The directors present the strategic report for the year ended 31 December 2025.
The principal activities of the group during the year encompassed all disciplines of consulting engineering and project management including specialist areas such as mechanical and electrical, building structures, civil engineering, land development and regeneration infrastructure, traffic & transportation rail, intelligent transportation systems, waste management, water, wastewater and environmental engineering, sustainable development, facilities management and property services.
The performance of the group in the financial year is considered successful in a challenging economic climate with post tax profits of £3.2m (2024: £4.0m).
The financial year of 2025 represents the fourth year of delivery against the business’ strategic growth plan, following a period of business transformation between 2019 and 2021. This has shown that investment decisions have largely resulted in our anticipated positive trading outcomes. The underlying focus on ensuring that the group operates in a resilient and agile manner remains unchanged and operational priorities continue to drive these attributes.
Our business model focuses on the provision of professional consultancy services, primarily within the UK. We generate and preserve value through the provision of high-quality advice and gaining a truly in-depth understanding of our clients and supporting them through the delivery and realisation of their strategic objectives. We seek to maintain a blend of public and private sector workstreams, diversified across sectors, specialisms, and regions. We continue to focus on key clients with whom we have a strong history of repeat business, underpinning our value proposition. Our key clients include Homes England, National Highways, West Midlands Combined Authority, Balfour Beatty, Transport for Greater Manchester, South West Water, Severn Trent Water, Kier, Costain, Galliford Try, Ebbsfleet Development Corporation as well as various Local Authorities.
Finally, we were extremely proud that in 2025, our primary trading subsidiary, Pell Frischmann Consultants Ltd, were awarded Consulting Firm of the Year at the New Civil Engineer (NCE) Awards, the preeminent awards in our industry. It is a particularly valuable achievement as they head into their centenary year in 2026.
In the context of our primary markets, we have continued to see a mixture of both opportunity and threat. In the year following the UK general election, we experienced a significant slow down in trading in the first half of 2025 compared to previous years. This resulted in some targeted restructuring, which, aligned with an improvement in some markets saw a stronger trading in the second half of the year. In summary these are:
Water: after decades of under investment, the Ofwat Price Review final determination in 2024 approved £104bn on infrastructure spending across AMP8 compared to £51bn across AMP7. Advanced work packages identified by South West Water in late 2024 stalled in the early part of 2025, which necessitated short term redeployment of staff as new projects were secured with other water clients, typically via design & build contractors. The second half of the year stabilised and the outlook for 2026 and beyond looks healthy. We offer niche services into this market which makes us attractive to both Tier 1 clients and D&B contractors.
Environment: since the introduction of the Environment Act in 2021, environmental considerations across all projects in the built environment have changed and will continue to change. We have invested significantly in upskilling our staff’s awareness of these issues, placing sustainability at the heart of our business focus. Having grown our capabilities in environmental management and assessment, ecology and biodiversity, landscape design, sustainability, circular economy and net zero services into a core part of our business model, we experienced less success in further diversification and so consolidated around this offering. Anticipated planning reforms are expected to increase pressure on authorities and developers in this area.
Buildings: the structural engineering market continues to shift towards more sustainable solutions, refurbishment and use of less carbon intensive materials. We have continued to develop these specialisms and have diversified regionally, with core teams in Cambridge and Manchester in order to expand our accessible markets. Our Cambridge team have made strong progress in the logistics market, which remains one of our key growth targets. In MEP engineering our shift towards the data centre market in the UK and internationally enabled us to weather the shocks experienced by other sectors in the Buildings market.
Highways & Transportation: major highways project opportunities have remained scarce in 2025, although we have positioned ourselves to be the first choice consultant for a select group of major highways contractors. We have continued to focus on regional markets and multi-modal transportation projects. We introduced Urban Mobility as a priority market Sector at the start of 2025 to align with the visions of local and combined authorities and needs of major developers and we have seen steady progress since doing so. Our specialism in active travel has seen continued success alongside our public transport expertise. Where working with core highways markets we have enhanced our sustainable design credentials with market leading carbon reporting tools and processes. Finally, our Highways Technology branch – facing significant headwinds from a reduction in central UK government investment in road technology solutions – successfully pivoted to local roads and terms maintenance contracts to alleviate the impact of this change.
Rail: now in Network Rail Control Period 7, the industry continues to face challenges and uncertainty over major project funding, re-nationalisation and the creation of Great British Railways. We have continued to look beyond this in offering multidisciplinary rail engineering services from business case stage, through early scheme development and asset management to detailed design and implementation for heavy and light rail, trams, and guided transit infrastructure.
Land Development: strategic land clients and the wider private sector market has again built steadily over the year as we have broadened our offering to the development market, whilst continuing to work in collaboration with a range of SME specialists with whom we have long term relationships. Housing remains a priority focus and access to Homes England via two frameworks as well as a range of private sector developers has underpinned a strong performance.
Energy: the government ambition to double onshore wind, triple solar power, and quadruple offshore wind by 2030, aligned with National Grid forecasting that electricity demand will increase 64% by 2035 is reflected in our Energy market strategy building on the strong reputation that we have in the renewables markets from our Edinburgh office. We again saw steady growth in this market in 2025.
The outlook for the next financial year and beyond is stable, reflected in a strong order book. Whilst growth will remain a challenge amidst continuing global economic and geopolitical uncertainties, as well as a flat UK economy, we remain confident that the relationships that have been built with key clients and the routes to market available to us via frameworks will result in positive trading through 2026 and beyond.
Principal Risks & Uncertainties
Talent Acquisition & Retention: Having grown our staff numbers significantly through 2023 and 2024, the slow start to 2025 resulted in this falling back and our staff churn rate increasing beyond that which we would want to see. Despite difficult trading conditions, talent acquisition remains a challenge in growth markets, as businesses look to retain their best people, often paying above market rates to do so. This is most acute in the Water sector.
Economic: We monitor economic indicators and sentiment in the markets in which we operate. We saw a negative shift in the first half of 2025 but saw an improvement in activity in the second half of the year despite there being little growth in the wider economy. Construction output grew by 1.8% in 2025 according to ONS data. Much of this growth came from private industrial work and public sector health & education.
Environment & Sustainability: The UK construction industry is the largest contributor to UK carbon and also provides the greatest opportunity for its reduction. As consultants, we have a responsibility to advise and support our clients to minimise and mitigate damage to the environment and are empowering our staff to do so through extensive training and development opportunities against their core sustainability competencies.
Financial: Our long/medium-term framework contracts bring predictable cash flows into the foreseeable future. This, together with our existing balance sheet strength, and minimal exposure to foreign exchange rate movements, significantly mitigates financial risks to our business. For UK projects, we minimise working capital balances and avoid overexposure to non-payment risk and support the wider industry through our commitment to prompt supply chain partners payment. Finally, we continually monitor resource utilisation, profitability, invoicing and cash collection very closely to ensure predictability of financial KPIs.
Geo-Political: Political instability in the regions within which we operate can threaten our ability to deliver contractual services and receive payment as well as endangering the safety of our staff. We obtain the latest professional risk and security information before engaging in contracts in new geographies and continue to monitor the stability and seek professional advice in respect of the markets in which we trade. The ongoing impact of the war in Ukraine and Gaza has presented a challenge to the UK economy, our clients and our staff due to its impact on inflation. We continue to monitor such matters in particular in respect of staff deployment to and securing payment from overseas locations.
Government Policy: We operate in a fluid and responsive environment which may be altered by government changes in regulation, procurement practices or policy. We mitigate this by carefully monitoring policy trends and attempting to ‘get ahead of the curve’. Notably, in respect of climate change recently, public procurement is being steered by government to ensure suppliers have a Carbon Reduction Plan and a net zero carbon commitment in place if they are to be awarded contracts over a specific value. Having already prepared a strategy and plan that responds to this, we were ahead of both the public announcement and its effect on public procurement procedure.
Health & Safety (H&S): Our business is concerned with the built environment, entailing significant safety risks to employees, clients, contractors and third parties. We take H&S seriously and ensure all staff are appropriately trained, and procedures are continuously reviewed and improved. The directors accept ultimate responsibility for the H&S and seek to ensure continual improvement in performance. We proactively track our Accident Incident Rate (AIR) and, once again, there have been no Enforcement/Prohibition Notices, or Offence Convictions in the year.
Physical & Data Security: Our business is dependent on the secure storage and transmission of data in either physical or electronic form. The risk of confidential data being mishandled, resulting in breach of contract, or the inappropriate release or loss of personal information of our clients or employees is significant. Because of this, our business systems will always be a target for crime, cyber or otherwise. We use appropriate physical security, secure networks and encryption in order to protect data with strong data protection business practices in place. We train staff on best practice in information security and confidentiality. Our businesses are Cyber Essentials Plus accredited.
Digitisation: Separate to the risk of data integrity is the effect of new/emerging technology on our traditional business model; much like e-commerce has disrupted the traditional high street. However, digital technology is also an opportunity. Due to our size, we can be more agile and therefore be earlier adopters of new ways of working and delivering. We were an earlier adopter of BIM and continue to see the potential in integrating a personable, relationship-based consultancy service with the speed and efficiency of automation and/or machine-learning techniques for solving problems. We continually monitor digital trends, carefully interrogate new/emerging technologies such as Artificial Intelligence and their likelihood of disruption and/or commoditisation of our services and, where relevant, seek to adopt them quickly and re-orient our business model to suit.
Reputational Risk: Our business is built on repeat business with key clients. Reputational damage could impact our ability to win future work or indeed damage these long-term relationships. We mitigate this by managing our contractual commitments and ensuring we operate robust cost and project management systems; certified and accredited to ISO 9001:2015 (quality management system).
Corporate Social Responsibility (CSR)
We are committed to corporate transparency on broader matters and believe it indicates our ability to generate and preserve value over the long term, and to assess the management of risks which may impact the sustainability of our business or affect society more broadly. 2025 represented another year of development in our performance, position and activities, including:
Equality, Diversity & Inclusion (EDI): PFCG remains committed to maintaining an inclusive culture that supports fairness, respect, and equal opportunities for all colleagues. Over the year, we reviewed and updated our Equality, Diversity & Inclusion Policy and strengthened EDI considerations across our people practices, including recruitment, talent reviews, and succession planning. Our primary trading entity, Pell Frischmann Consultants, achieved Level 4 Embedded Status through the Supply Chain Sustainability School's Fairness Inclusion and Respect (FIR) Growth Assessment in 2024 and in July 2025 were shortlisted for the NCE’s ‘Equality, Diversity and Inclusion Leader – Consultant award.
Ethics: During 2025, we rolled out updated anti-corruption and anti-trust training across our businesses with further compliance system improvements (employee code of conduct, supplier/client due diligence) due for launch in 2026.
Social Value: At the beginning of 2024, we began sharing resources from Pell Frischmann Consultants Ltd across PFCG to support Social Value, seeking to improve overall performance. This support continues and PFCG have delivered further investment throughout 2025 and collaboratively delivered a range of Social Value activities, which includes 1,115hrs of volunteering for local organisations/VCSEs, 150 Young People supported through our Early Careers Programmes, and support for 31 charities across the UK.
Health & Wellbeing: We continue to operate a wellbeing strategy to support our people, including access to independent advisors and specialists via an EAP service, along with the provision of mental health first aiders.
Sustainability, Environment & Carbon: Sustainability strategy, policy, and carbon foot printing activities remain ongoing as we seek to address carbon neutrality and net zero targets.
Key performance indicators
The directors use a range of performance measures to monitor and manage the business. A number of these measures are particularly important in the generation of shareholder value, thus are considered KPIs. Our KPIs monitor past performance which not only provides us with information to manage the business in the present, but also enables us to make informed choices regarding future strategic decisions. Turnover, gross profit margin and EBITDA are monitored closely. KPIs for the year ended 31 December 2025 are turnover of £64.8m (2024: £65.2m), gross profit margin of 23.2% (2024: 25.0%) and EBITDA of £4.6m (2024: £5.9m).
The directors, in line with their duties under s172 of the Companies Act 2006, act individually and collectively in the way they consider, in good faith, would be most likely to promote the success of the group for the benefit of its members, and in doing so have regard, amongst other matters, to the:
Likely consequences of any decision in the long term;
Interests of the group's employees;
Need to foster the group's business relationships with suppliers, customers and others;
Impact of the group's operations on the community and the environment;
Desirability of the group maintaining a reputation for high standards of business conduct;
Need to act fairly as between members of the group.
Stakeholders
The directors understand the importance of engagement with all of their stakeholders and give appropriate weighting to the outcome of their decisions for the relevant stakeholder in weighing up how best to promote the success of the group. The directors regularly discuss issues concerning customers, suppliers, employees, community and environment and their shareholders, which it takes into account in its discussions and in its decision-making process. In addition to this, the directors seek to understand the interests and views of the group's stakeholders by engaging with them directly when required. The below summarises the key stakeholders and the engagement with each:
Customers
The directors are in regular contact with their customers, including to obtain feedback on matters such as quality of our services. The group works closely with its customers to achieve long term client satisfaction through bespoke service delivery.
Suppliers
The group works with a range of suppliers and remains committed to being fair and transparent in dealings with all suppliers. The group has, where relevant, procedures in place requiring due diligence of suppliers as to their internal governance, including for example, their anti-bribery and corruption practices, data protection policies and modern slavery matters. The group has systems and processes in place to ensure suppliers are paid in a timely manner.
Employees
The group has a well-established management reporting structure which encourages employee engagement in an open working environment. The directors are responsible for ensuring that this structure enables effective communication and feedback between employees and management.
Community and environment
The directors are aware of the impact its activities can have on the environment and is committed to minimising the group's environmental footprint.
Shareholders
The directors also seek to behave in a responsible manner towards its shareholders. The directors communicate information relevant to its shareholders, such as its financial reporting information, in the form and frequency agreed between the parties.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 December 2025.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Ordinary dividends were paid amounting to £4,450,000 (2024: £4,625,000). The directors do not recommend payment of a further dividend.
The group's policy is to consult and discuss with employees, staff councils and at meetings, matters likely to affect employees' interests.
Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the group's performance.
The auditor, Moore Kingston Smith LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
This SECR report outlines Pell Frischmann Consultants Limited operational carbon footprint for the 2025 reporting year mandatory emissions under the Environmental Reporting Guidelines, calculated using methodologies aligned with industry best practices, including the GHG Protocol.
An operational control approach has been selected for this carbon footprint assessment.
Data was gathered from direct sources where available, with assumptions made where necessary, and emissions were categorized by Scope 1, 2, and 3. Scope 1 emissions included gas consumption, using location-based data estimated using m2 floor area data and the CIBSE 2021 benchmarks for a typical airconditioned office, while mobile combustion emissions were calculated based on vehicle kilometre data. For Scope 2 emissions, electricity consumption, where primary data was not readily available, was estimated using location-based data, calculated with m2 floor area and the CIBSE 2021 benchmarks a typical airconditioned office. For Scope 2 emissions where primary data was available market-based data was utilised e.g., REGO certificates indicating renewable energy use in certain sites. Scope 3 emissions, specifically from business travel, were calculated using kilometre data and emissions factors from the UK Government Conversion Factors for accommodation and car travel.
The methodology and calculations that have been used throughout this footprint report align with industry best practice guidance that is issued as part of the GHG protocol methodologies. A description of these methodologies is provided below:
The GHG Protocol standard provides guidance for organisations who are looking to prepare a robust corporate-level GHG Emissions inventory.
It is the most widely used reporting standard and covers the accounting and reporting of the following seven GHGs covered by the Kyoto Protocol: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PCFs), sulphur hexafluoride (SF6) and nitrogen trifluoride (NF3).
The methodology behind the GHG Protocol allows an organisation to report their carbon Emissions in tonnes of carbon dioxide equivalent (tCO2e), a reporting unit that considers the seven GHGs listed above.
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per employee, the recommended ratio for the sector.
In the period covered by the report, Pell Frischmann Consultants Limited has commenced:
Re-negotiation of electricity and gas contracts to renewables contracts with landlords and suppliers wherever possible.
The installation of smart meters (water, gas and electricity) wherever possible.
The introduction of retrofitted low carbon solutions (LED lighting, smart lighting, power down/off IT equipment).
Purchase of energy efficient equipment and products to replace older, less efficient, equipment and products.
Promotion of public transport for work-related travel and reduction in company cars / pool cars.
The introduction of connected-technologies to enable flexible and at home working, reducing business travel and employee commuting.
The move to more sustainable office spaces.
In the period covered by the report the Company has purchased 241,151 (2024: 212,694) kWh of renewable energy. The attributes are backed by Renewable Energy Guarantees of Origin (REGOs), and the renewable power generated is free from the use of nuclear energy as Pell Frischmann recognises this to not currently be a recognised Net Zero energy source for electricity.
We have audited the financial statements of PF Consulting Group Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2025 which comprise the Group Statement of Comprehensive Income, the Group Statement Of Financial Position, the Company Statement Of Financial Position, the Group Statement of Changes in Equity, the Company Statement of Changes in Equity and notes to the financial statements, including 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).
Basis for 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 group's and parent 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
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our 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.
As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the group's or the parent company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the group or the parent company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
Explanation as to what extent the audit was considered capable of detecting irregularities, including
fraud
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 objectives of our audit in respect of 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 to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company.
Our approach was as follows:
We obtained an understanding of the legal and regulatory requirements applicable to the company and considered that the most significant are the Companies Act 2006, UK financial reporting standards as issued by the Financial Reporting Council, and UK taxation legislation.
We obtained an understanding of how the company complies with these requirements by discussions with management and those charged with governance.
We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance.
We inquired of management and those charged with governance as to any known instances of noncompliance or suspected non-compliance with laws and regulations.
Based on this understanding, we designed specific appropriate audit procedures to identify instances of non-compliance with laws and regulations. This included making enquiries of management and those charged with governance and obtaining additional corroborative evidence as required.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
Use of our report
This report is made solely to the parent 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 parent company’s members those matters we are required to state to them in an auditor's 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 parent company and the parent company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
The Group Statement of Comprehensive Income has been prepared on the basis that all operations are continuing operations.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £4,207,848 (2024: £4,245,057).
PF Consulting Group Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is First Floor, South Wing, 55 Baker Street, London, England, W1U 8EW.
The group consists of PF Consulting Group Limited and all of its subsidiaries.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’: Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The information is included in the consolidated financial statements of RSBG UK Limited, a company registered in England and Wales as at 31 December 2025 and these financial statements may be obtained from the company secretary at the company’s registered address: First Floor, South Wing, 55 Baker Street, London, England, W1U 8EW.
The consolidated financial statements incorporate those of PF Consulting Group Limited and its subsidiaries (ie entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes.
One entity is not consolidated into the financial statements, Bernwood E C S Limited. This is not consolidated on the basis that the balance is immaterial, and it is treated as an investment within the accounts.
All financial statements are made up to 31 December 2025. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used in line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
At the time of approving the financial statements, the directors have a reasonable expectation that the group and company will be able to meet their liabilities as they fall due for the foreseeable future (and at least a period of 12 months beyond the date of approval of these financial statements). This is based on their assessment of the trading position of the group and company and their consideration of the impact of external factors. Having considered these factors, they have concluded that there is no significant impact to the going concern status of the group and company, thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
Turnover is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that are recoverable.
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised as intangible fixed assets to the extent that the technical, commercial and financial feasibility can be demonstrated.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the income statement.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's statement of financial position when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
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 leases asset are consumed.
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
Subsidiary audit exemption
The Company's active subsidiaries Pell Frischmann Limited, Pell Frischmann Consulting Engineers Limited and Desco (2011) Limited are exempt from the requirements of the Companies Act 2006 relating to the audit of their individual accounts by virtue of section 479A of the Companies Act 2006.
The parent company has therefore guaranteed all existing liabilities of the above entities and this guarantee will remain in force until those liabilities are settled.
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
On initial recognition, the assets and liabilities of the acquired business and the consideration paid for them are included in the consolidated financial statements at their fair values. In measuring fair value, management uses estimates of future cash flows and discount rates. Any subsequent changes in these estimates would affect the amount of goodwill recognised.
In attributing value to intangible assets arising on acquisition, management has made certain assumptions in terms of cash flows attributable to intellectual property and customer relationships. The key assumptions relate to the trading performance of the acquired business, royalty rates applied in the royalty relief calculation and discount rates applied to calculate the present value of future cash flows.
The Group recognises a significant amount of goodwill and intangible assets. Management have estimated the useful economic life to be between 3 to 16 years. This is based on forecasting prepared for the cash generating unit to which the assets relate.
Accrued and deferred income is assessed on an individual basis with revenue earned being ascertained based on the stage of completion of the contract which is estimated using a combination of the milestones in the contract and the time spent to date. This is compared to the total time expected to be required to undertake the contract. Judgements of the total time required to undertake the contracts are made on a regular basis and subject to management review. These judgements may differ from the actual results due to a variety of factors such as efficiency of working, accuracy of assessment of progress to date and client decision making.
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
During the year retirement benefits were accruing to 1 director (2024 - 1) in respect of defined contribution pension schemes.
The actual (credit)/charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
Details of the company's subsidiaries at 31 December 2025 are as follows:
The registered office address for each subsidiary is available from the company secretary at the registered office of the company.
Pell Frischmann Limited, company number 02750217, Pell Frischmann Consulting Engineers Limited, company number 01213169 and Desco (2011) Limited, company number 07557654, were exempt from the requirements of the Companies Act 2006 relating to the audit of individual accounts by virtue of s479A of the Act.
The dilapidations provision relates to the anticipated costs for restoring the group offices to their original state on termination of the leases and is expected to be utilised in line with when the leases expire. The timing of the utilisation of other provisions is uncertain.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
Share premium comprise amounts paid in excess of share capital's nominal value, net of transfers to the profit and loss account.
Other reserves arose on the waiver of an intercompany debt.
As at the reporting end date the company had outstanding commitments for future lease payment under operating leases, which fall due as follows:
The company had no commitments under non-cancellable operating leases as at the reporting date.
There are unquantified contingent liabilities in the normal course of business arising under consultancy contracts and the company is covered by professional indemnity insurance in respect of claims which the directors believe is adequate.
There is also an unlimited multilateral guarantee and debenture including fixed and floating charges over all assets between the company and its fellow group companies.
At 31 December 2025 the Group had no capital commitments (2024: £nil).
The Group and company have taken advantage of the exemption available in section 33.1A of FRS 102 not to disclose transactions with other wholly owned group companies.