| The Sleep People Limited |
| Strategic Report |
|
The Company is a manufacturer and distributor of residential and commercial bedding products, including mattresses, divans and associated sleep products. Operations include manufacturing, assembly, warehousing, distribution, and after-sales customer support.
The Company serves a diversified customer base comprising online marketplaces, hospitality providers, furniture retailers, and wholesale distributors. The business operates through a combination of direct-to-consumer sales channels, trade partnerships, and e-commerce platforms.
During the financial year, the Company continued to focus on operational efficiency, product innovation, sustainable manufacturing practices, and strengthening customer relationships in a competitive market environment. |
|
| Strategic Objectives |
| The Company’s principal strategic objectives are: |
| ● |
To strengthen market share within the domestic bedding and furniture sector. |
| ● |
To expand online and direct-to-consumer sales channels. |
| ● |
To maintain high standards of product quality and customer satisfaction. |
| ● |
To improve manufacturing efficiency and cost management. |
| ● |
To invest in sustainable sourcing and environmentally responsible production. |
| ● |
To diversify product offerings and enhance product innovation. |
| ● |
To preserve long-term profitability and shareholder value. |
|
| Management monitors performance against these objectives through financial and operational key performance indicators. |
|
| Business Model |
| The Company generates revenue through the manufacture and sale mattresses and beds. |
|
| Procurement |
| The Company sources timber, textiles, foam, springs, packaging materials, and hardware components from approved domestic and international suppliers. |
|
| Manufacturing |
| Products are manufactured and assembled at the Company’s production facilities using a combination of skilled labour and automated processes. |
|
| Distribution |
| Finished products are distributed through retail partners, wholesalers, hospitality contracts, and direct customer deliveries. |
|
| Customer Service |
| The Company provides product warranties, delivery coordination, and after-sales support to maintain customer satisfaction and repeat business. |
|
| Key Performance Indicators |
|
|
2025 |
2024 |
|
Warranty Claim Rate |
1.19% |
|
Inventory Turnover |
13.3 |
15.7 |
|
Gross Profit Margin |
30.3% |
32.2% |
|
|
|
| Principal Risks and Uncertainties |
| The Company continually assesses risks that may affect business performance and financial stability. |
|
| Supply Chain Risk |
| Disruptions to the availability or pricing of raw materials may affect production schedules and profit margins. |
| Mitigation Measures: |
| ● |
Diversification of suppliers. |
| ● |
Long-term supplier relationships. |
| ● |
Inventory management controls. |
| ● |
Ongoing procurement reviews. |
|
| Economic Conditions |
| Reduced consumer spending and broader economic uncertainty may affect demand for discretionary household purchases. |
| Mitigation Measures: |
| ● |
Product diversification. |
| ● |
Flexible pricing strategies. |
| ● |
Expansion into commercial markets. |
| ● |
Strengthening online sales channels. |
|
| Competition |
| The market remains highly competitive with pressure from domestic manufacturers and imported products. |
| Mitigation Measures: |
| ● |
Product quality differentiation. |
| ● |
Customer service focus. |
| ● |
Investment in branding and innovation. |
| ● |
Efficient manufacturing operations. |
|
| Operational risk |
| Manufacturing interruptions, equipment failure, or labour shortages may impact operational efficiency. |
| Mitigation Measures: |
| ● |
Preventative maintenance programmes. |
| ● |
Health and safety compliance. |
| ● |
Workforce training initiatives. |
| ● |
Business continuity planning. |
|
| Regulatory and Environmental Risk |
| The Company is subject to environmental, employment, health and safety, and consumer protection regulations. |
| Mitigation Measures: |
| ● |
Compliance monitoring. |
| ● |
Internal control procedures. |
| ● |
Staff training. |
| ● |
Environmental management practices. |
|
|
| The Directors present this Strategic Report for the year ended 31 March 2025 in accordance with applicable company law and reporting requirements. |
|
|
| This report was approved by the board on 22 May 2026 and signed on its behalf. |
|
|
|
| Timothy Hargreave |
| Director |
|
|
| 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 company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. |
|
| Conclusions relating to going concern |
| In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. |
| Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. |
| Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. |
|
| Other information |
| The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. |
| We have nothing to report in this regard. |
|
| Opinions on other matters prescribed by the Companies Act 2006 |
| In our opinion, based on the work undertaken in the course of the audit: |
| ● |
the information given in the strategic report and the directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
| ● |
the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements. |
|
| Matters on which we are required to report by exception |
|
Plant and machinery |
over 5 years |
|
|
Stocks |
|
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first in first out method. The carrying amount of stock sold is recognised as an expense in the period in which the related revenue is recognised. |
|
|
Debtors |
|
Short term debtors are measured at transaction price (which is usually the invoice price), less any impairment losses for bad and doubtful debts. Loans and other financial assets are initially recognised at transaction price including any transaction costs and subsequently measured at amortised cost determined using the effective interest method, less any impairment losses for bad and doubtful debts. |
|
|
Cash and cash equivalents |
|
Cash and cash equivalents are basic financial assets and 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 overdraft are shown within borrowings in current liabilities. |
|
|
Creditors |
|
Short term creditors are measured at transaction price (which is usually the invoice price). Loans and other financial liabilities are initially recognised at transaction price net of any transaction costs and subsequently measured at amortised cost determined using the effective interest method. |
|
|
Taxation |
|
A current tax liability is recognised for the tax payable on the taxable profit of the current and past periods. A current tax asset is recognised in respect of a tax loss that can be carried back to recover tax paid in a previous period. Deferred tax is recognised in respect of all timing differences between the recognition of income and expenses in the financial statements and their inclusion in tax assessments. Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted. |
|
|
Provisions |
|
Provisions (ie liabilities of uncertain timing or amount) are recognised when there is an obligation at the reporting date as a result of a past event, it is probable that economic benefit will be transferred to settle the obligation and the amount of the obligation can be estimated reliably. |
|
|
Leased assets |
|
A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership. All other leases are classified as operating leases. The rights of use and obligations under finance leases are initially recognised as assets and liabilities at amounts equal to the fair value of the leased assets or, if lower, the present value of the minimum lease payments. Minimum lease payments are apportioned between the finance charge and the reduction in the outstanding liability using the effective interest rate method. The finance charge is allocated to each period during the lease so as to produce a constant periodic rate of interest on the remaining balance of the liability. Leased assets are depreciated in accordance with the company's policy for tangible fixed assets. If there is no reasonable certainty that ownership will be obtained at the end of the lease term, the asset is depreciated over the lower of the lease term and its useful life. Operating lease payments are recognised as an expense on a straight line basis over the lease term. |
|
|
Pensions |
|
Contributions to defined contribution plans are expensed in the period to which they relate. |
|
|
| 2 |
Analysis of turnover |
2025 |
|
2024 |
| £ |
£ |
|
|
Sale of goods |
11,344,244 |
|
11,691,742 |
|
Services rendered |
3,965,810 |
|
3,909,652 |
|
|
|
|
|
|
15,310,054 |
|
15,601,394 |
|
|
|
|
|
|
|
|
|
|
By geographical market: |
|
|
UK |
15,310,054 |
|
15,601,394 |
|
|
|
|
|
|
|
|
|
|
| 3 |
Operating profit |
2025 |
|
2024 |
| £ |
£ |
|
This is stated after charging: |
|
|
Depreciation of owned fixed assets |
147,409 |
|
155,475 |
|
Auditors' remuneration for audit services |
12,000 |
|
- |
|
Carrying amount of stock sold |
6,417,813 |
|
6,891,094 |
|
|
|
|
|
|
|
|
|
|
| 4 |
Directors' emoluments |
2025 |
|
2024 |
| £ |
£ |
|
|
Emoluments |
225,333 |
|
220,614 |
|
Company contributions to defined contribution pension plans |
24,000 |
|
25,400 |
|
|
|
|
|
|
249,333 |
|
246,014 |
|
|
|
|
|
|
|
|
|
|
|
Number of directors to whom retirement benefits accrued: |
2025 |
|
2024 |
| Number |
Number |
|
|
Defined contribution plans |
2 |
|
2 |
|
|
|
|
|
|
|
|
|
|
| 5 |
Staff costs |
2025 |
|
2024 |
| £ |
£ |
|
|
Wages and salaries |
2,683,364 |
|
2,363,298 |
|
Social security costs |
283,450 |
|
245,781 |
|
Other pension costs |
61,337 |
|
58,455 |
|
|
|
|
|
|
3,028,151 |
|
2,667,534 |
|
|
|
|
|
|
|
|
|
|
|
Average number of employees during the year |
Number |
Number |
|
|
Administration |
21 |
|
- |
|
Manufacturing |
80 |
|
91 |
|
|
|
|
|
|
101 |
|
91 |
|
|
|
|
|
|
|
|
|
|
| 6 |
Interest payable |
2025 |
|
2024 |
| £ |
£ |
|
|
Bank loans and overdrafts |
- |
|
(20,181) |
|
Other loans |
10,132 |
|
5,903 |
|
Finance charges payable under finance leases and hire purchase contracts |
|
1,656 |
|
1,656 |
|
|
|
|
|
|
11,788 |
|
(12,622) |
|
|
|
|
|
|
|
|
|
|
| 7 |
Taxation |
2025 |
|
2024 |
| £ |
£ |
|
Analysis of charge in period |
|
Current tax: |
|
UK corporation tax on profits of the period |
106,049 |
|
304,006 |
|
Adjustments in respect of previous periods |
32,293 |
|
- |
|
|
|
|
|
|
138,342 |
|
304,006 |
|
|
|
|
|
|
|
|
|
|
Deferred tax: |
|
Origination and reversal of timing differences |
(9,295) |
|
23,322 |
|
|
|
|
|
|
|
|
|
|
|
Tax on profit on ordinary activities |
129,047 |
|
327,328 |
|
|
|
|
|
|
|
|
|
|
|
Factors affecting tax charge for period |
|
The differences between the tax assessed for the period and the standard rate of corporation tax are explained as follows: |
|
|
|
|
|
|
|
2025 |
|
2024 |
| £ |
£ |
|
Profit on ordinary activities before tax |
265,146 |
|
1,191,047 |
|
|
|
|
|
|
|
|
|
|
Standard rate of corporation tax in the UK |
25% |
|
25% |
|
| £ |
£ |
|
Profit on ordinary activities multiplied by the standard rate of corporation tax |
|
66,287 |
|
297,762 |
|
|
Effects of: |
|
Expenses not deductible for tax purposes |
15,068 |
|
875 |
|
Capital allowances for period in excess of depreciation |
24,694 |
|
5,369 |
|
Adjustments to tax charge in respect of previous periods |
32,293 |
|
- |
|
|
Current tax charge for period |
138,342 |
|
304,006 |
|
|
|
|
|
|
|
|
|
|
|
| 8 |
Tangible fixed assets |
|
|
|
|
Land and buildings |
|
Plant and machinery |
|
Total |
|
|
|
|
At cost |
|
At cost |
| £ |
£ |
£ |
|
Cost or valuation |
|
At 1 April 2024 |
2,500,000 |
|
1,329,955 |
|
3,829,955 |
|
Additions |
- |
|
61,461 |
|
61,461 |
|
Disposals |
- |
|
(86,920) |
|
(86,920) |
|
At 31 March 2025 |
2,500,000 |
|
1,304,496 |
|
3,804,496 |
|
|
|
|
|
|
|
|
|
|
Depreciation |
|
At 1 April 2024 |
220,040 |
|
869,496 |
|
1,089,536 |
|
Charge for the year |
50,000 |
|
97,409 |
|
147,409 |
|
On disposals |
- |
|
(73,744) |
|
(73,744) |
|
At 31 March 2025 |
270,040 |
|
893,161 |
|
1,163,201 |
|
|
|
|
|
|
|
|
|
|
Carrying amount |
|
At 31 March 2025 |
2,229,960 |
|
411,335 |
|
2,641,295 |
|
At 31 March 2024 |
2,279,960 |
|
460,459 |
|
2,740,419 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2025 |
|
2024 |
| £ |
£ |
|
Carrying amount of land and buildings on cost basis |
1,879,500 |
|
1,879,500 |
|
|
|
|
|
|
|
|
|
|
Independent valuation carried out by Bradley Hall, Chartered Surveyors & Estate Agents on the 30/10/2023. This report has been prepared in accordance with Royal Institution of Chartered Surveyors (“RICS”) Valuation – Global Standards January 2022 (incorporating the International Valuation Standards). Assumptions included but are not limited to tenure, letting, town planning, build costs, environmental factors, condition and repair. |
|
|
Management periodically review the property value to ensure that is it reasonable. |
|
|
|
|
|
|
|
2025 |
|
2024 |
| £ |
£ |
|
Carrying value of plant and machinery included above held under finance leases and hire purchase contracts |
|
42,157 |
|
23,962 |
|
|
|
|
|
|
|
|
|
|
| 9 |
Stocks |
2025 |
|
2024 |
| £ |
£ |
|
|
Finished goods and goods for resale |
799,845 |
|
672,020 |
|
|
|
|
|
|
|
|
|
|
| 10 |
Debtors |
2025 |
|
2024 |
| £ |
£ |
|
|
Trade debtors |
891,343 |
|
1,154,377 |
|
Other debtors |
800,741 |
|
1,539,770 |
|
Prepayments and accrued income |
74,312 |
|
15,095 |
|
|
|
|
|
|
1,766,396 |
|
2,709,242 |
|
|
|
|
|
|
|
|
|
|
| 11 |
Creditors: amounts falling due within one year |
2025 |
|
2024 |
| £ |
£ |
|
|
Obligations under finance lease and hire purchase contracts |
19,735 |
|
7,120 |
|
Trade creditors |
1,181,657 |
|
1,433,425 |
|
Amounts owed to parent entity |
|
39,235 |
|
- |
|
Corporation tax |
111,925 |
|
445,698 |
|
Other taxes and social security costs |
222,722 |
|
58,111 |
|
Other creditors |
76,274 |
|
19,610 |
|
Accruals and deferred income |
139,302 |
|
164,514 |
|
|
|
|
|
|
1,790,850 |
|
2,128,478 |
|
|
|
|
|
|
|
|
|
|
There is a bank overdraft of £1million secured against the property. |
|
|
| 12 |
Creditors: amounts falling due after one year |
2025 |
|
2024 |
| £ |
£ |
|
|
Obligations under finance lease and hire purchase contracts |
28,891 |
|
18,986 |
|
|
|
|
|
|
|
|
|
|
| 13 |
Obligations under finance leases and hire purchase |
2025 |
|
2024 |
|
contracts |
£ |
£ |
|
|
Amounts payable: |
|
Within one year |
19,735 |
|
7,120 |
|
Within two to five years |
28,891 |
|
18,986 |
|
|
|
|
|
|
48,626 |
|
26,106 |
|
|
|
|
|
|
|
|
|
|
There are two HP agreements:
1) Agreement 1 repayable over 5 years with an interest rate of 23%.
2) Agreement 2 repayable over 4 years with an interest rate of 16%. |
|
|
| 14 |
Deferred taxation |
2025 |
|
2024 |
| £ |
£ |
|
|
Accelerated capital allowances |
104,369 |
|
113,664 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2025 |
|
2024 |
| £ |
£ |
|
|
At 1 April |
113,664 |
|
90,342 |
|
(Credited)/charged to the profit and loss account |
(9,295) |
|
23,322 |
|
|
At 31 March |
104,369 |
|
113,664 |
|
|
|
|
|
|
|
|
|
|
|
| 15 |
Provisions for liabilities |
|
|
|
|
|
|
|
|
Warranties |
| £ |
|
At 1 April 2024 |
- |
|
Additional provisions made during the period |
236,920 |
|
|
At 31 March 2025 |
236,920 |
|
|
|
|
|
|
|
|
|
|
This provision is for a one year manufacturer's warranty on all mattresses produced. The provision is based on prior year claims which were the equivalent to 1% of turnover, which is fully released in the following financial year. |
|
|
| 16 |
Share capital |
Nominal |
|
2025 |
|
2025 |
|
2024 |
| value |
Number |
£ |
£ |
|
Allotted, called up and fully paid: |
|
Ordinary shares |
£1 each |
|
100 |
|
100 |
|
100 |
|
|
|
|
|
|
|
|
|
|
| 17 |
Other reserves |
2025 |
|
2024 |
|
Revaluation reserve |
£ |
£ |
|
|
At 1 April |
620,500 |
|
620,500 |
|
|
At 31 March |
620,500 |
|
620,500 |
|
|
|
|
|
|
|
|
|
|
| 18 |
Profit and loss account |
2025 |
|
2024 |
| £ |
£ |
|
|
At 1 April |
3,521,359 |
|
3,247,640 |
|
Profit for the financial year |
136,099 |
|
863,719 |
|
Dividends |
(1,000,000) |
|
(590,000) |
|
|
At 31 March |
2,657,458 |
|
3,521,359 |
|
|
|
|
|
|
|
|
|
|
| 19 |
Dividends |
2025 |
|
2024 |
| £ |
£ |
|
|
Dividends on ordinary shares (note 18) |
1,000,000 |
|
590,000 |
|
|
|
|
|
|
|
|
|
|
|
| 20 |
Events after the reporting date |
|
|
The property was sold after the year end to the parent entity. |
|
|
| 21 |
Analysis of changes in net funds |
|
|
|
|
At 1 April 2024 |
|
Cash flows |
At 31 March 2025 |
|
|
|
|
£ |
|
£ |
|
£ |
|
Cash at bank and in hand |
281,406 |
|
(49,854) |
|
231,552 |
|
Lease liabilities |
(26,106) |
|
(22,520) |
|
(48,626) |
|
|
|
|
|
255,300 |
|
(72,374) |
|
182,926 |
|
|
|
|
|
|
|
|
|
|
| 22 |
Related party transactions |
|
|
The Company has taken advantage of the exemption in FRS8 "Related Party Disclosures" from disclosing transactions with other members of the group. |
|
|
Starlight Beds Limited
The Company shares production and office resources with Starlight Beds Limited, a company with a director in common. During the year management charges are paid from Starlight Beds Limited to the Company of £4,775,861 (2024 - £3,195,409). As at the year end Starlight Beds Limited owed the company £547,829 (2024 - £926,984). |
|
|
Extreme Comfort (UK) Limited
The Company shares production and office resources with Extreme Comfort (UK) Limited, a company with a director in common. During the year management charges are paid from Extreme Comfort (UK) Limited to the Company of £1,375,000 (2024 - £2,070,702). As at the year end Extreme Comfort (UK) Limited owed the company £179,320 (2024 - £329,858). |
|
| 23 |
Controlling party |
|
|
The Company is controlled by The Sleep People (Holdings) Limited. The smallest and largest group of undertakings for which group accounts are drawn up and of which the company is a member is The Sleep People (Holdings) Limited. Copies of these can be obtained from the registered office.
The ultimate controlling party is The Sleep People (Holdings) Limited registered in England and Wales. |
|
|
| 24 |
Presentation currency |
|
|
The financial statements are presented in Sterling. |
|
|
| 25 |
Legal form of entity and country of incorporation |
|
|
The Sleep People Limited is a private company limited by shares and incorporated in England. |
|
|
| 26 |
Principal place of business |
|
|
The address of the company's principal place of business and registered office is: |
|
|
Unit 4 Royds Mills |
|
Leeds Road |
|
Ossett |
|
West Yorkshire |
|
WF5 9YA |