The directors present the strategic report for the year ended 31 December 2025. This is the first year in which consolidated financial statements have been prepared following the incorporation of the office in China during the year ended 31 December 2025.

In 2019 the Group implemented its long-term strategic plan which was targeted to adapt to the changes forecast in the marketplace. The primary objective of this strategic shift was to create long term sustainable business revenue streams and increase the Group’s sphere of influence over the generation of such revenues. To achieve this the Group focused on a strategy of developing and licensing technology in addition to providing its traditional engineering services.

The success of these initiatives has been the driving force in this financial period, delivering strong group cashflows and providing a solid platform for generating long term growth in revenues and profits in future years. The Group exited the calendar year with some headwinds due to a prolonged downturn in the Petrochemical industry, which has led to a reduced group order backlog as compared to 2024. This said, the Group has been planning for this downturn and has positioned itself to meet these challenges and to take advantage of business opportunities as the market recovers.

During 2025 the Group took action to secure its long-term vision of being a global services provider of the Polyolefins industry. Specifically, in February of 2025 the Group opened its first office in Shanghai, China with the formation of its 100% owned subsidiary ECI Engineering Consultancy & Service. The Group believes this entity will play a key role in providing support for our existing clients as well as growth opportunities for the Group through project execution and business development

For the 12-month period ending December 31, 2025, the Group recorded sales of £9,119,305 and a trading loss after tax of £733,116 respectively against sales of £9,777,351 and a trading profit after tax of £349,024 in the previous 12-month reporting period. The decrease in revenue for 2025 was primarily attributable to a decrease in engineering utilization due to market factors as well as the Group's continued focus on research and development in 2025. A loss has been reported in the year due to reduced revenue, an impairment of an intangible asset, and foreign exchange movements. Project profitability remains consistent with previous years with gross margins being in excess of 50% of revenue.

Key Highlights

• Completion of several engineering milestones on five new build projects for LDPE plants in China during the year.

• Award and progress of a debottlenecking project in the Middle East.

• Continued development of in-house Technology products to service the needs of several polyolefins’ technology markets.

• Continued focus and development within the Recycling sector.

• Strong repeat business from blue chip client base.

• Strong pipeline for new customers in markets inside and outside of China.

• The business remains under the ownership of Engineers and Constructors International, Inc. (ECI) of Baton Rouge, LA and Houston, TX.

Outlook and Growth Plans

Simon Carves Engineering Limited provides comprehensive engineering and technical services across the global process industry sector, with strong focus on the polyolefins sector. Its expertise and growth lie in the following areas that provide a strong and sustainable pipeline of future investments:

• Polymers and Petrochemicals, predominantly LDPE/EVA and High-Pressure Copolymers, LLDPE, HDPE, and PP with significant future growth forecast particularly in emerging markets for new build plants and opportunities for optimisation and de-bottlenecking of existing plants.

Outlook and Growth Plans (continued)

• Focussed shift to Plant Engineering, providing general and specialist engineering services (modifications, upgrades, debottlenecking) to process plants outside of China.

• Development of niche annuity technical services revenues through the provision of highly specialised Subject Matter Experts to support clients with operational issues and requirements for plant improvements.

• Movement into new niche Technology areas leveraging the experiences of ECI Group to establish a diversified portfolio built on our core engineering skills and quality, without compromising the highly respectful relationships built up with our technology partners over the last three decades.

• Focus and attention on developing the Group's Recycling business by partnering with industry partners.

• Development of key strategic partnerships in chosen markets to maximise revenue opportunities.

A risk the business faces, like all businesses at this time, is the uncertainty created by the unprecedented impacts on global economies as a direct consequence of the Ukraine/Russia conflict which has fuelled significant global inflation. The business currently has a healthy order book providing workload into 2026 and beyond but some Global headwinds in the Polyolefins industry exist. The risks identified above may have an impact on the supply chain with increased prices and order backlogs potentially impacting the planned completion time of current and future projects. Mitigation strategies focussed on cost control, supply chain management, improvement in effectiveness and efficiency of operational execution of projects and strong cashflow management have been implemented to ensure the business is well positioned to react to any deviation from its current plan.

The core focus of the business remains unchanged as detailed below:

The business's strategic plan is geared to optimisation within these chosen sectors through focus on its;

• People, recognising the need to attract, develop and retain highly skilled workforce is fundamental to the success of future business growth. We are developing the skills, capabilities, and services necessary to meet the changing needs of our major customers.

• Cost Base Management with focus on driving the down nonvalue added costs and improving productivity, and efficiencies, synergies with its parent Company.

• Organic growth and strategic partnerships focussed on gaining traction in new markets whilst growing core markets of Polymers and Chemicals through collaboration with existing Customers and the development of new business.

• Project Execution strategy aligned to the core principles of "on time, first time, and under budget".

Projects Under Execution

During the last 12 months the Group successfully and profitably completed engineering projects for clients in China, the Middle East, Taiwan and North America. The Group is currently executing group projects in Europe, Asia, North America, and China for completion during 2026 and 2027.

A number of the major risks and uncertainties facing the business are described below.

Contractual Risk

The Group engages in major engineering design contracts, and is exposed to cost and reputation risk, if it fails to deliver projects on time, within budget and to specification. This risk is mitigated through the Group's project risk management system. Contractual risks are identified and evaluated at the tendering stage before a binding bid is submitted and go through a tiered authorisation procedure which can be up to Board level, depending on the value of the contract. Each project is monitored continually throughout the project execution phase to enable any remedial actions to be identified at an early stage.

Principal risks and uncertainties (continued)

Health and Safety Risk

Health and safety in the office and on sites is of paramount importance to the Group. The Group employs suitable qualified Health and Safety professionals to ensure that the Group and clients' safety procedures are adhered to. This includes safety induction for all new employees and for employees who visit or work on sites. Senior management meet on a regular basis to ensure that safety receives priority attention.

Geopolitical Risk

The Group's business is international and there can be geopolitical risk. This can take several forms. There can be exposure for our employees working in certain countries. The Group takes steps to mitigate this particular risk by employing the services of a specialist security Company to provide local monitoring and back up services where appropriate.

Geopolitical risk can also result in credit risk exposure and wherever possible the Group will seek to arrange insurance cover for overseas credit and political risk.

Currency Transaction Exposure

The international nature of the business creates currency risk exposure. Currency exposure is continuously monitored throughout the life of the contracts and where appropriate, mitigated through the use of forward exchange contracts.

Liquidity Risk

The Company aims to mitigate liquidity risk by managing cash generation of its operations and through implementation of collection policies. Projects are bid on a cash-positive basis, with advanced payment obtained from the client. Forecasting is done on a rolling 12-month basis.

IT Failure

The Group is dependent on IT systems. The Group believes that its IT infrastructure is well protected and dependable, but the Group recognises the wholesale failure of its systems would have profound consequences and has a business continuity plan in place to mitigate any loss. The Group has robust mitigation plans should access to the office be temporarily restricted due to any reason for example government instruction. These plans enable all staff to work remotely from home with no loss of business operation or efficiency.

Economic Risk

Towards the end of 2021 there was the emergence of economic risk due to the impact on the global economy of the Covid-19 pandemic which has created global inflation as the supply chain struggles to cope with the upward rebound from the pandemic. The risk to the business is that key clients will face increasing prices for raw materials/commodities and a backed-up equipment supply chain causing project completion delays. In addition, the petro chemical industry has experienced a recent slowdown which has affected our client’s ability to invest in capital projects. We are subject to changes in global investment patterns within our core industries which can impact our ability to generate new work orders. The directors closely monitor potential impacts to the Group's future workload and put in place mitigation strategies to negate any impact. For example, the diversification of our product offering into the growth areas of other Polyolefins technologies and further development of new business streams leveraging the Group's core skills and competencies.

The Group ensures all major risks to protect itself from significant unforeseen events.

On behalf of the board

The directors present their report with the financial statements of the Group for the 12-month period ended 31 December 2025.

The principal activity of the Group in the year under review was that of providing comprehensive engineering services and technology know how across the global process industry sector, focusing on petrochemicals and process-based industries. Since the acquisition in August 2016 by ECI, the Group's capabilities have been significantly enhanced particularly in relation to green plant development, plant optimisation, de-bottlenecking, and product offerings.

Within the next financial year, the business expects to continue to support the high-pressure engineering needs of our strategic clients and technology partners, while growing in other polymer technologies.

The future pipeline of secured order book and potential orders remains strong and varied providing a base workload into year 2026 and beyond.

During 2024 and 2025 economic risk has emerged due to the impact on the global effect of the Russia/Ukraine conflict which has created global inflation within the supply chain. In addition, the Polyolefins sector has faced pressure due to oversupply of polymers in the marketplace. The directors closely monitor potential impacts to the Group's future workload and put in place mitigation strategies to negate any impact.

Despite the global uncertainty affecting all Companies and economies, the Group is expecting to secure further engineering works in the polymer and chemical sectors to be executed during the forthcoming 2026 financial year and build upon its successful entry into the delivery of niche technical driven support services to global polymer clients.

The results for the year are set out on page 10.

No dividends will be distributed for the year ended 31 December 2025 (2024: nil).

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

The international nature of the business creates currency risk exposure. Currency exposure is continuously monitored throughout the life of the contracts and where appropriate, mitigated through the use of forward exchange contracts.

The Group aims to mitigate liquidity risk by managing cash generation of its operations and through implementation of collection policies. Projects are bid on a cash-positive basis, with advanced payment obtained from the client.

Forecasting is done on a rolling 12-month basis.

It is the Group's policy that payments to suppliers are made in accordance with those terms and conditions agreed between the Group and its suppliers, provided that all trading terms and conditions have been complied with.

It is the Group's policy to commit sufficient resources to enable it to keep abreast of all relevant product, process, market, and systems developments in the fields in which it operates.

Each director in office at the date of approval of this annual report confirms that:

• so far as the director is aware, there is no relevant audit information of which the Group's auditor is unaware, and

• the director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the Group's auditor is aware of that information.

This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.

This report has been prepared in accordance with the provisions applicable to Groups entitled to the medium-sized groups exemption.

The directors are responsible for preparing the annual 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 group financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the United Kingdom. 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 Group and of the profit or loss of the Group for that period.

In preparing these financial statements, International Accounting Standard 1 requires that directors:

• properly select and apply accounting policies;

• present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;

• provide additional disclosures when compliance with the specific requirements in IFRSs are insufficient to enable users to understand the impact of particular transactions, other events and conditions on the entity's financial position and financial performance; and

• make an assessment of the company's ability to continue as a going concern.

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

We have audited the financial statements of Simon Carves Engineering Limited (the ‘parent company’) and its subsidiaries (the ‘group’) for the year ended 31 December 2025 which comprise the consolidated statement of comprehensive income, the consolidated statement of financial position, the consolidated statement of changes in equity, the consolidated statement of cash flows and the consolidated notes to the financial statements, including significant accounting policies.

The financial reporting framework that has been applied in their preparation is applicable law and UK adopted international accounting standards.

In our opinion:

• the financial statements give a true and fair view of the state of the group's affairs as at 31 December 2025 and of the group's loss for the year then ended;

• the financial statements have been properly prepared in accordance with UK adopted international accounting standards; and

• the financial statements 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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the 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

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

In the light of the knowledge and understanding of the group and parent company and their 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

• the parent company 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.

As explained more fully in the directors' responsibilities statement, 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 parent 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 parent company or to cease operations, or have no realistic alternative but to do so.

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 auditor's 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.

Extent to which the audit was 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:

Fraud

We assessed the susceptibility of the Group's financial statements to material misstatement, including fraud. Our risk assessment procedures included:

• Enquiry with Group management and those charged with governance regarding any known or suspected instances of fraud;

• Obtaining an understanding of the Group's policies and procedures relating to:

  • Detecting and responding to the risks of fraud; and

  • Internal controls established to mitigate risks related to fraud.

• Review of minutes of meeting of those charged with governance for any known or suspected instances of fraud;

• Discussion amongst the engagement team, including consideration of the component entity, as to how and where fraud might occur in the Group financial statements; and

• Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud.

Extent to which the audit was capable of detecting irregularities, including fraud (continued)

Based on our risk assessment, we considered the areas most susceptible to fraud to be journals and revenue.

Our procedures in respect of the above included:

• Testing a sample of journal entries across the Group, which met a defined risk criteria, by agreeing to supporting documentation;

• Assessing any significant estimates made by management for bias; and

• Procedures to test revenue including agreement of revenue recognised to supporting documentation for projects worked in the year.

As part of our group audit procedures, we reviewed the audit work performed by the component auditor on the financial information of the component based in China, including review of trial balances, supporting schedules and underlying accounting records, and assessed the appropriateness of its inclusion within the Group consolidation.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members who were all deemed to have appropriate competence and capabilities and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that 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, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

A further description of our responsibilities is available on the Financial Reporting Council's website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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 notes on pages 14 to 30 form part of these group financial statements.

The notes on pages 14 to 30 form part of these group financial statements.

The notes on pages 14 to 30 form part of these group financial statements.

The notes on pages 14 to 30 form part of these group financial statements.

Simon Carves Engineering Limited is a private company limited by shares incorporated in England and Wales. The registered office is 3a & 3b, Second Floor, Manchester International Office Centre, Styal Road, Heald Green, Manchester, M22 5WB.

The group consists of Simon Carves Engineering Limited and all of its subsidiaries.

The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted for use in the United Kingdom and with the requirements of the Companies Act 2006 applicable to companies reporting under IFRS, except as otherwise stated.

The financial statements are prepared in sterling, which is the functional currency of the group. 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 consolidated group financial statements consist of the financial statements of the parent company Simon Carves Engineering Limited together with all entities controlled by the parent company (its subsidiaries).

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 into 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.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

The directors have at the time of approving the financial statements, a reasonable expectation that the trueGroup has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Engineers and Constructors International Incorporated (the parent company) is willing to provide immediate financial support to Simon Carves Engineering Limited in case of its financial difficulties provided that the Group's Management Board has submitted a reasoned application for that purpose, and if necessary, invest additional funds essential to ensure that Simon Carves Engineering Limited will continue as a going concern.

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 includes the amounts of services provided during the financial period excluding VAT after adjusting for long term contract provisions as required by IFRS15.

Contract revenue associated with long term construction contracts are based on two differing arrangements.

Reimbursable contracts are valued by the stage of completion of a project determined by the valuation of number of hours incurred for the work performed as at the balance sheet date.

Fixed price contracts are valued on an earned value basis, calculated as a percentage of completion of contractual obligations as at the balance sheet date.

Revenue from contracts for the provision of professional services is recognised on the above basis provided costs incurred and costs to complete can be estimated reliably. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that are recoverable. Profit is not recognised unless there is reasonable progress on the contract. If total cost of a contract, based on technical and other estimates, is estimated to exceed the total contract revenue, the foreseeable loss is provided for.

Contract revenue earned in excess of billing has been classified as “Unbilled revenue (work-in-progress)” and billing in excess of contract revenue has been classified as “Other liabilities” in the financial statements.

The Group assesses the carrying value of various claims periodically, and makes provisions for any unrecoverable amount arising from the legal and arbitration proceedings that they may be involved in from time to time. Insurance claims are accounted for on acceptance/settlement with insurers.

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Licence                     10 years

Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

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.

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the parent company. 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 end date, the group reviews the carrying amounts of its tangible 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 group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment annually, and whenever there is an indication that the asset may be impaired.

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.

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.

Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

Financial assets are recognised in the group's statement of financial position when the group becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.

At initial recognition, financial assets classified as fair value through profit and loss are measured at fair value and any transaction costs are recognised in profit or loss. Financial assets not classified as fair value through profit and loss are initially measured at fair value plus transaction costs.

When any of the above-mentioned conditions for classification of financial assets is not met, a financial asset is classified as measured at fair value through profit or loss. Financial assets measured at fair value through profit or loss are recognized initially at fair value and any transaction costs are recognised in profit or loss when incurred. A gain or loss on a financial asset measured at fair value through profit or loss is recognised in profit or loss, and is included within finance income or finance costs in the statement of income for the reporting period in which it arises.

Financial instruments are classified as financial assets measured at amortised cost where the objective is to hold these assets in order to collect contractual cash flows, and the contractual cash flows are solely payments of principal and interest. They arise principally from the provision of goods and services to customers (eg trade receivables). They are initially recognised at fair value plus transaction costs directly attributable to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment where necessary.

Debt instruments are classified as financial assets measured at fair value through other comprehensive income where the financial assets are held within the group’s business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A debt instrument measured at fair value through other comprehensive income is recognised initially at fair value plus transaction costs directly attributable to the asset. After initial recognition, each asset is measured at fair value, with changes in fair value included in other comprehensive income. Accumulated gains or losses recognised through other comprehensive income are directly transferred to profit or loss when the debt instrument is derecognised.

The parent company has made an irrevocable election to recognize changes in fair value of investments in equity instruments through other comprehensive income, not through profit or loss. A gain or loss from fair value changes will be shown in other comprehensive income and will not be reclassified subsequently to profit or loss. Equity instruments measured at fair value through other comprehensive income are recognized initially at fair value plus transaction cost directly attributable to the asset. After initial recognition, each asset is measured at fair value, with changes in fair value included in other comprehensive income. Accumulated gains or losses recognized through other comprehensive income are directly transferred to retained earnings when the equity instrument is derecognized or its fair value substantially decreased. Dividends are recognized as finance income in profit or loss.

Financial assets carried at amortised cost and FVOCI are assessed for indicators of impairment at each reporting end date.

The expected credit losses associated with these assets are estimated on a forward-looking basis. A broad range of information is considered when assessing credit risk and measuring expected credit losses, including past events, current conditions, and reasonable and supportable forecasts that affect the expected collectability of the future cash flows of the instrument.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.

The group recognises financial debt when the group becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as either 'financial liabilities at fair value through profit or loss' or 'other financial liabilities'.

Other financial liabilities, including borrowings, trade payables and other short-term monetary liabilities, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.

Financial liabilities are derecognised when, and only when, the group’s obligations are discharged, cancelled, or they expire.

Equity instruments issued by the parent company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer payable at the discretion of the company.

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 is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary 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 when the group has 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 inventories or non-current 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 group 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.

At inception, the group assesses whether a contract is, or contains, a lease within the scope of IFRS 16. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Where a tangible asset is acquired through a lease, the group recognises a right-of-use asset and a lease liability at the lease commencement date. Right-of-use assets are included within property, plant and equipment, apart from those that meet the definition of investment property.

The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date plus any initial direct costs and an estimate of the cost of obligations to dismantle, remove, refurbish or restore the underlying asset and the site on which it is located, less any lease incentives received.

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of other property, plant and equipment. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are unpaid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the group's incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise fixed payments, variable lease payments that depend on an index or a rate, amounts expected to be payable under a residual value guarantee, and the cost of any options that the group is reasonably certain to exercise, such as the exercise price under a purchase option, lease payments in an optional renewal period, or penalties for early termination of a lease.

The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in: future lease payments arising from a change in an index or rate; the group's estimate of the amount expected to be payable under a residual value guarantee; or the group's assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

The group has elected not to recognise right-of-use assets and lease liabilities for short-term leases of machinery that have a lease term of 12 months or less, or for leases of low-value assets including IT equipment. The payments associated with these leases are recognised in profit or loss on a straight-line basis over the lease term.

The Group does not apply IFRS's before their effective dates. The nature of the Group's activities are such that the current reported results are unlikely to be affected by those IFRS's or amendments thereto, that have been published but not yet come into effect, neither is there anticipated to be any requirement for restatement in the future. The directors consider this to be true as some standards and interpretations are clearly not applicable to the Group or are not expected to have a material effect.

In the current year, the following amendment was effective for the period beginning 1 January 2025:

• Lack of Exchangeability (Amendments to IAS 21)

There are a number of standards, amendments to standards, and interpretations that have been issued by the IASB and endorsed by the UK Endorsement Board (UKEB) and are effective in future accounting periods. However, the Group has decided not to adopt these early.

The following new or revised standards are effective for the period beginning 1 January 2027:

• IFRS 18 Presentation and Disclosures in Financial Statements.

The following amendment is effective for the period beginning 1 January 2026:

• Amendment to IFRS 9 and IFRS 7 - Classification and Measurement of Financial Instruments.

• Annual improvements to IFRS – Volume 11.

• Amendment to IFRS 9 and IFRS 7 - Contracts Referencing Nature-dependent Electricity.

The Group is currently assessing the impact of these new accounting standards and amendments. The Group does not envisage any significant changes in accounting policies following the adoption of the new and revised standards, other than changes to presentation and disclosure where applicable.

The Group has assessed the impact of IFRS 18 which introduces revised requirements for the presentation and disclosure of financial information, including new defined subtotals within the statement of profit or loss and enhanced disclosure requirements. The Group does not believe that IFRS 18 will have a significant impact on the recognition or measurement of its assets, liabilities, income or expenses, although certain presentation and disclosure changes may be required upon adoption.

The Group has assessed the amendments to IFRS 9 and IFRS 7 relating to the classification and measurement of financial instruments. The Group holds only basic financial instruments, such as trade receivables, trade payables and intercompany balances, and does not believe that the amendments will have a significant impact on the classification or measurement of its financial assets or liabilities.

The Group has also assessed the amendments to IFRS 9 and IFRS 7 relating to contracts referencing nature-dependent electricity. The Group does not enter into such arrangements and therefore does not expect the amendments to have any impact on its financial statements.

The Group has reviewed the Annual Improvements to IFRS Accounting Standards – Volume 11 and does not expect these minor amendments to have a material impact on its financial statements.

In the application of the company’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, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are outlined below.

Property and equipment is depreciated over its estimated useful life, which is based on estimates for expected usage of the asset and expected physical wear and tear which are dependent on operational factors. Management has not considered any residual value as it is deemed immaterial.

The Group reviews its property and equipment to assess impairment, if there is an indication of impairment. In determining whether impairment losses should be recorded in the statement of profit or loss and other comprehensive income, the Group makes judgment as to whether there is any observable data indicating that there is a reduction in the carrying value of property and equipment. Accordingly, provision for impairment is made when there is an identified loss event or condition which, based on previous experience, is evidence of a reduction in the carrying value of property and equipment.

In determining the lease terms, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included in the lease terms if the leases are reasonably certain to be extended (or not terminated). The assessment is reviewed if a significant event or a significant change in circumstances occurs which affects this assessment and that is within the control of the lessee.

The Group tests for impairment of trade and other receivables when there are indicators that carrying amounts may not be recoverable. The provision for impairment of receivable comprises allowances for doubtful debts in determining the recoverability of trade and other receivables the group consider any change in the credit quality and the recoverable amount of receivable at the reporting date.

The Group is required to assess each of its contracts with customers to determine whether performance obligations are satisfied over time or at a point in time in order to determine the appropriate method for recognising revenue. The Group has assessed that based on the contracts entered into with customers and the provisions of relevant laws and regulations, the Group recognises revenue point in time from sale of goods. Where revenue is recognised at a point in time, the Group assesses each contract with customers to determine when the performance obligation of the Group under the contract is satisfied.

The average monthly number of persons (including directors) employed by the group during the year was:

Their aggregate remuneration comprised:

The charge for the year can be reconciled to the loss per the income statement as follows:

Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:

The Group recognised an impairment loss of £637,148 in respect of the licensing agreement. The impairment arose following the termination of the agreement in May 2025. As a result, the asset is no longer expected to generate future economic benefits and has been written down to its recoverable amount of nil.

Details of the company's subsidiaries at 31 December 2025 are as follows:

The directors consider that the carrying amount of trade and other receivables is approximately equal to their fair value.

No significant receivable balances are impaired at the reporting end date.

The Company’s leases comprise office space used for office operations, together with leases for copiers and software licences.

Periodic rentals are fixed over the lease terms. The lease for the Company’s office premises includes a break clause after six years, which represents the effective lease term for accounting purposes. All leases have fixed periodic payments and are due to expire within the next six years.

Deferred tax assets are expected to be recovered after more than one year. The following are the major deferred tax liabilities and assets recognised by the group and movements thereon during the current and prior reporting period.

The group operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

Financial instruments - Risk management

In common with all other businesses, the Group is exposed to risks that arise from its use of financial instruments. This note describes the Group's objectives, policies and processes for managing those risks and the methods used to measure them.

There have been no substantive changes in the Group's exposure to financial instrument risks, its objectives, policies and processes for managing those risks or the methods used to measure them from previous periods unless otherwise stated in this note.

The overall objective of the Group is to set policies that seek to reduce risk as far as possible without unduly affecting the Group's competitiveness and flexibility. Further details regarding these policies are set out below:

Capital risk management

The capital is managed by the Group in a way that it is able to continue as a going concern while maximising returns to shareholders.

The capital structure of the Group consists of borrowings, cash and cash equivalents and equity attributable to equity holders, comprising of authorised, issued and paid up capital, shareholder's funds, reserves and retained earnings. As a risk management policy, the Group reviews its cost of capital and risks associated with capital. The Group balances its capital structure based on the above review.

Market risk management

Market risk arises from the Group's use of interest bearing, tradable and foreign currency financial instruments. It is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in interest rates (interest rate risk), foreign exchange rates (currency risk) or other market factors (other price risk).

The Group is primarily exposed to the financial risks of changes in foreign currency exchange rates and interest rates. Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

Foreign currency risk management

The international nature of the business creates currency risk exposure when the Group enters into transactions denominated in a currency other than their functional currency. The Group's policy to manage this risk is to take out contracts in GBP wherever possible to mitigate the impact of currency fluctuations on projected returns.

Interest rate risk management

The Group is exposed to interest rate risk as the Group borrows funds at fixed and floating rates. Sensitivity analysis of interest rates is as follows:

The Group's profits will not have a material impact If the interest rates have been 50 base points higher or lower and all other variables were held constant.

Credit risk management

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Group is potentially exposed to concentration of credit risk from its financial assets which comprise principally, bank balances,trade and other receivables and due from related parties. The Group's bank accounts are placed with high credit quality financial institutions. The credit risk on trade receivables and due from related parties are subjected to credit evaluations and a credit loss allowance is made if recovery of any receivable is doubtful. Further disclosures regarding trade and other receivables, which are neither past due not impaired, are provided in note 16.

Liquidity risk management

Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities.

The Group has built an appropriate liquidity risk management framework for the management of its short, medium and long term funding and liquidity requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and borrowing facilities by continuously monitoring forecast and actual cashflows.

During the year the group entered into the following transactions with related parties:

The following amounts were outstanding at the reporting end date:

The ultimate controlling party of the Group is Engineers and Constructors International, Inc., a Company incorporated in the State of Texas, United States of America.