REGISTERED NUMBER: 01462295 (England and Wales)

DGS GROUP PLC

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

Page

Company Information

1

Strategic Report

2

to

5

Report of the Directors

6

to

7

Report of the Independent Auditors

8

to

10

Profit and Loss Account

11

Balance Sheet

12

Statement of Changes in Equity

13

Notes to the Financial Statements

14

to

22

DIRECTORS:

Mr Derek Aucott

Mrs Margaret Rose Aucott

Mr David Aucott

Mrs Elizabeth Slocombe

Miss Helen Aucott

Mr Daniel Aucott

SECRETARY:

Mrs Elizabeth Slocombe

REGISTERED OFFICE:

4 Bank Court

Weldon Road

Loughborough

Leicestershire

LE11 5RF

REGISTERED NUMBER:

01462295 (England and Wales)

AUDITORS:

Essex Abel Ltd (Statutory Auditors)

4 Bank Court

Weldon Road

Loughborough

Leicestershire

LE11 5RF

The directors present their strategic report for the year ended 31 December 2025.

REVIEW OF BUSINESS

The company's principal activity is the supply of components to the double glazing industry in the United Kingdom.

We aim to present a balanced and comprehensive review of the development and performance of our business during the year and its position at the year-end.

Our review is consistent with the size and non-complex nature of our business and is written in the context of the risks and uncertainties we face.

Results and performance

2025 was a challenging year for the construction industry given the current economic conditions and the company's performance should be considered in relation to this background. As part of the directors' strategic review of the business, they took the decision to restructure the company, which included the consolidation of the smaller branches into the larger regional hubs to improve the operational efficiencies and customer service. This resulted in the closure of the branch in Exeter in February 2025 and the closure of three further branches in the first quarter of 2026.

During this period of restructuring, the company reported a profit before tax and prior to directors' annual bonuses of £702,409 (2024 - £803,736). The statutory results of the company for the year, as set out on pages 12 to 25, show a profit on ordinary activities before tax of £35,409 (2024 - £29,896). The shareholders' funds of the company total £10,951,076 (2024: £10,926,362).

The company's revenue in 2025 has seen a decrease from the previous years, with revenues down 5.2% however, the revenues for the year are still higher than the pre-pandemic period and the further reduction was expected following the boom which occurred in the immediate post pandemic period. Our gross margin shows a small decrease of 0.22% compared to 2024, due to inflationary increases in wages (including the increase in National Insurance costs) and goods costs that were not reflected in our prices during the year.

Business environment

The company has continued with its activities as a provider of components to the double glazing industry within the UK.

As for many businesses of our size, the business environment in which we operate continues to be challenging, but we believe the company is well placed to deliver its performance objectives. The double glazing component market in the UK is highly competitive and there is continuing downward pressure on margins, with many companies offering similar products which gives rise to pressure on the sales prices to maintain existing business as customers become more price sensitive.

We are of course also subject to consumer spending patterns and consumers overall level of disposable income within the economy.

Strategy

The company's success is dependent on the selection, pricing and ongoing management of the risks it has identified.

In the double glazing component supply industry, we believe it is important to retain a diversified product range of high quality goods to service the demands of our customers and to achieve the maximum profitability in this competitive marketplace.

We continue to endeavour to take advantage of new opportunities for growth as they arise in the future to enable us to grow and develop the business and the range of products that we offer, including our own brand of components.

The company continues to aim to improve efficiency in all areas of our operations through the continued focus of sourcing the best quality materials and services at the best price for our customers and to continue to improve our customer service levels.

PRINCIPAL RISKS AND UNCERTAINTIES

The process of risk management is applied through a combination of policies, procedures and internal controls. All policies are subject to Board approval and ongoing review by management. Compliance with regulation, legal and ethical standards is a high priority for the company. The finance team is responsible for ensuring that effective internal controls exist to manage the financial risks and that these controls operate effectively.

We the directors endeavour to identify the risks that the company faces to ensure we have the financial strength and operational capacity to support the growth of the business.

The principal risks from our business arise from the recoverability of debts from the customers and the competitive nature of the marketplace in which it operates. In addition, along with all businesses in the UK, the company is exposed to the political climate. The directors are confident of continuing to be at the forefront of offering innovative, quality products to meet the demands of its customers for the foreseeable future.

The company and wider group's strong cash position removes some elements of the financial risks any business faces. With business risks and uncertainties in mind, we are aware that any plans for the future development of the business may be subject to unforeseen future events outside of our control.

SECTION 172(1) STATEMENT

This S172 statement, explains how the directors have:

- Engaged with employees, customers, and others; and

- had regard to employees' interests, the need to foster the company's relationship with suppliers, customers and others, and the effect of that regards, including on the principal decisions taken by the company during the financial period.

The S172 statement focuses on matters of strategic importance to the company and the level of information disclosed is consistent with the size and complexity of the business.

When making decisions, each director ensures that they act in a way they consider, in good faith, would most likely promote the Company's success for the benefit of its members, and in doing so have regards (among other matters) to the section 172 matters.

The likely consequence of any decision in the long term

Key decisions and matters that are of strategic importance are always discussed openly between the board members and its key advisors.

As part of making these decisions the board considers the potential impact they will have in the short and long term on all parties that have an interest in the company. Whether it be employees, customers, suppliers or the community and environment.

The directors recognise their social responsibility as part of the community in which it operates and respects the political, social, legal and cultural diversity of all its stakeholders.

The long term aims of the company, in addition to increasing the shareholder value, is to provide secure employment opportunities within the local areas in which it operates. During these challenging economic times, ensuring that people have secure and stable employment is more important than ever.

Engagement with employees:

The directors recognise that the employees are fundamental to the success of the company. They have worked hard to establish a company culture that puts people first and recognise that recruiting and retaining motivated staff is key to the company's long-term development. The directors help all employees reach their full potential through training and development opportunities.

The directors are always committed to providing a safe, secure, and inclusive working environment. The directors want all their staff to feel safe, and employees are encouraged to provide feedback and speak their minds so that the company can continually develop and improve.

Engagement with our customers:

Having traded for over 45 years, the need to build and maintain strong, long-standing relationships with customers has always been important to the directors, with customer service and satisfaction being paramount to the company's success. Our network of branches deliver daily throughout the UK ensuring that we really are a national company with a local service.

Engagement with suppliers:

We seek to ensure that we engage with all our suppliers and value the long-term relationships that have been built over the years.

The directors understand that many businesses have encountered financial difficulties during this period of economic uncertainty, so the directors ensure that suppliers are paid in a timely manner.

We use a range of national and international suppliers to ensure the highest quality products are available to our customers.

The impact on the community and its environment:

We believe that the way we conduct ourselves and the business influences our customers, suppliers, employees and the planet. Therefore, to have a positive impact on each of these we regularly consider our policies to ensure we have a positive impact on each.

We have branches throughout the UK ensuring that deliveries are as local as possible, reducing the environmental impact our operations.

Reputation for high standards:

At DGS Group plc we are proud of our high standards and our success is based on having the right product ranges available. Through our dedication and continual improvement, we can consistently demonstrate best practice, and as a result have gained a range of industry accreditations.

The need to act fairly between members:

The shareholders in the company are also the main directors and so the decisions made by the directors are always fair between the members of the company.

KEY PERFORMANCE INDICATORS

We consider that our key financial performance indicators are those that communicate the financial performance and strength of the company, these being turnover, gross margin and operating profit.

We continually aim to develop our business and maintain the margin on our products. Turnover for the year decreased approximately 5.2% due mainly to the higher level of trade that was being experienced since the pandemic and 2025 being more in line with our pre pandemic trading patterns. Our focus continues to be on maintaining a stable margin on the product ranges available, whilst offering the best possible products and service to our customer base.

The gross margin for the company has decreased for the year to 17.1% (2024: 17.3%), which mostly due to a change in the product mix of the sales and not increasing our prices fully in line with our increased costs (predominantly in relation to wages). We continue to review the business processes to improve efficiencies and reduce costs wherever possible.

Overall, the company has reported a profit before tax of £35,409 (2024 - £29,896).

Exposure to price, credit, liquidity and cash flow risk

The company has a normal level of exposure to price, liquidity and cash flow risks arising from trading activities and do not consider these to be significant risks to its operations.

The company has a financial management framework which its objective is to protect the company from events that hinder the achievement of the company's performance objectives.

The objectives aim to limit undue exposure to business and financial risks and ensure sufficient working capital exists.

Credit risk is the risk that one party to a financial instrument will cause a financial loss for that other party by failing to discharge an obligation. company policies are aimed at minimising such losses and require that deferred terms are only granted to customers who demonstrate an appropriate payment history and satisfy credit worthiness procedures. Details of the company's debtors are shown in Note 12 to the financial statements.The objectives aim to limit undue exposure to business and financial risks and ensure sufficient working capital exists.

Use of derivatives

The company uses forward foreign currency contracts to reduce exposure to the variability of foreign exchange rates by fixing the rate of any material payments in a foreign currency.

FUTURE DEVELOPMENT

The directors anticipate that the business environment will remain challenging in the short term and as part of their strategic review and restructuring of the business, they took the decision to close the Brentwood (January 2026), Newcastle and Swansea branches of the company in March 2026 with the customers now being serviced from the company's regional branches. Despite these challenges, the directors believe that the company is in a good financial position, with new product lines being introduced throughout the year.

ON BEHALF OF THE BOARD:

Mr David Aucott - Director

2 June 2026

The directors present their report with the financial statements of the company for the year ended 31 December 2025.

DIVIDENDS

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

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2025 to the date of this report.

Mr Derek Aucott

Mrs Margaret Rose Aucott

Mr David Aucott

Mrs Elizabeth Slocombe

Miss Helen Aucott

Mr Daniel Aucott

PAYMENT POLICY AND PRACTICE

It is the company's policy to agree the terms of payment with suppliers before entering into any transactions and to abide by the agreed terms.

DISCLOSURE IN THE STRATEGIC REPORT

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Schedule 7 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 to be contained in the directors' report. It has done so in respect of future developments and financial instruments.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

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

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

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

ON BEHALF OF THE BOARD:

Mr David Aucott - Director

2 June 2026

Opinion

We have audited the financial statements of DGS Group plc (the 'company') for the year ended 31 December 2025 which comprise the Profit and Loss Account, Balance Sheet, Statement of Changes in Equity and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 December 2025 and of its profit for the year then ended;

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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 directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

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.

In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

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

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

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

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

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

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

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

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page six, 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 necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

Auditors' responsibilities for the audit of the financial statements

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

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

We 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.

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

We obtained an understanding of the internal controls which are used by the entity in order to prevent such fraud or errors from occurring and design audit test and procedures in order to test the appropriateness and effectiveness of such internal controls.

We have performed substantive testing in order to assess the appropriateness of the internal controls and whether the controls are being followed and as such to what extent the risk of fraud or error is being mitigated through these controls.

We obtained an understanding on the subjective judgements made by management, such as accounting estimates where there is a potential for personal bias to affect the judgements which have been made. We have also obtained an understanding of the accounting policies which have been used by management.

We held discussions with management to find the rationale behind any judgemental area such as accounting estimates and assessed the appropriateness of accounting policies used, using our professional judgement.

We identified the laws and regulations applicable to the company through discussions with the directors and other management. These were communicated throughout the audit team and the team remained alert to instances of non-compliance throughout the audit.

We assessed the extent of compliance with laws and regulations identified through making enquiries of management and those charged with governance.

We correspond 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 or inadequacies in internal controls that we identify during our audit.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Jason Mark Oram FCCA (Senior Statutory Auditor)

for and on behalf of Essex Abel Ltd (Statutory Auditors)

4 Bank Court

Weldon Road

Loughborough

Leicestershire

LE11 5RF

2 June 2026

TURNOVER

3

27,910,979

29,445,913

Cost of sales

23,134,087

24,344,259

GROSS PROFIT

4,776,892

5,101,654

Distribution costs

392,408

398,163

Administrative expenses

4,441,326

4,694,895

4,833,734

5,093,058

(56,842

)

8,596

Other operating income

9,172

7,500

OPERATING (LOSS)/PROFIT

5

(47,670

)

16,096

Interest receivable and similar income

83,079

13,800

PROFIT BEFORE TAXATION

35,409

29,896

Tax on profit

7

10,695

(35,822

)

PROFIT FOR THE FINANCIAL YEAR

24,714

65,718

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

24,714

65,718

FIXED ASSETS

Tangible assets

8

921,815

900,254

CURRENT ASSETS

Stocks

9

5,552,283

6,024,380

Debtors

10

3,649,695

4,434,328

Cash at bank and in hand

2,667,038

1,390,030

11,869,016

11,848,738

CREDITORS

Amounts falling due within one year

11

1,642,916

1,603,757

NET CURRENT ASSETS

10,226,100

10,244,981

TOTAL ASSETS LESS CURRENT LIABILITIES

11,147,915

11,145,235

PROVISIONS FOR LIABILITIES

13

146,839

168,873

NET ASSETS

11,001,076

10,976,362

CAPITAL AND RESERVES

Called up share capital

14

50,000

50,000

Retained earnings

15

10,951,076

10,926,362

SHAREHOLDERS' FUNDS

11,001,076

10,976,362

The financial statements were approved and authorised for issue by the Board of Directors and authorised for issue on 2 June 2026 and were signed on its behalf by:

Mr Derek Aucott - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2024

50,000

10,860,644

10,910,644

Changes in equity

Total comprehensive income

-

65,718

65,718

Balance at 31 December 2024

50,000

10,926,362

10,976,362

Changes in equity

Total comprehensive income

-

24,714

24,714

Balance at 31 December 2025

50,000

10,951,076

11,001,076

1.	STATUTORY INFORMATION

DGS Group Plc is a private company incorporated in England and Wales under the Companies Act. The address of the registered office is given in the company information section and its principal place of business is at Sycamore Road, Trent Lane Industrial Estate, Castle Donington, Derbyshire, DE74 2NW.

The financial statements are presented in Sterling (£) and rounded to the nearest pound.

The company's principal activities are set out in the strategic report and directors report.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Financial Reporting Standard 102 - reduced disclosure exemptions

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

•

the requirements of Section 7 Statement of Cash Flows;

•

the requirement of paragraph 3.17(d);

•

the requirement of paragraph 33.7.

Significant judgements and estimates

In the application of the company's accounting policies, which are described in the accounting policies, management is required to make judgements, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and underlying 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 key sources of estimation uncertainty that have a significant effect on the amounts recognised in the financial statements are described below.

a) Stock provisioning

At each reporting date judgement is used by management to establish the net realisable value of stock. Provisions are established for net realisable value where appropriate and are made based on the facts available at the time. The level of provision required is reviewed on an on-going basis.

In arriving at an estimate for the net realisable value of stock, judgement is required in assessing their likely value on realisation taking into account market and technological changes.

b) Establishing useful economic lives for depreciation purposes of property, plant and equipment

Long-lived assets, consisting primarily of property, plant and equipment, comprise a significant portion of the total assets. The annual depreciation charge depends primarily on the estimated useful economic lives of each type of asset and estimates of residual values. The directors regularly review these asset useful economic lives and change them as necessary to reflect current thinking on remaining lives in light of prospective economic utilisation and physical condition of the assets concerned. Changes in asset useful lives can have a significant impact on depreciation and amortisation charges for the period. Detail of the useful economic lives is included in the accounting policies.

Revenue recognition

Turnover represents net invoiced sale of goods, excluding value added tax.

Revenue is recognised on the sale of goods when the significant risks and rewards of ownership of the goods have passed to the buyer and the amount of revenue can be measured reliably. Revenue on goods delivered is recognised when goods have been dispatched to the customer.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Long leasehold

-

2% on cost

Plant and machinery

-

25% on cost and 10% on cost

Fixtures and fittings

-

10% on cost

Motor vehicles

-

25% on reducing balance

Tangible assets are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes the original purchase price, costs directly attributable to bringing the asset to its working condition for its intended use.

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell, and after making due allowance for obsolete and slow moving items.

The cost of stock is calculated on a first in first out basis and includes expenditure incurred in acquiring stock, production or conversion costs, and other costs incurred in bringing them to their existing location and condition. Stocks are recognised as an expense in the period in which the related revenue is recognised.

The stock was previously calculated on the weighted average cost principle.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price, in the ordinary course of business, less costs to complete and sell. The impairment provision is determined primarily by future demand forecasts. The write down is measured as the difference between the calculated cost of the stock and market based upon assumptions about future demand and charged to the provision for stock, which is a component of cost of sales.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Profit and Loss Account, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts are capitalised in the balance sheet and are depreciated over their estimated useful lives

The interest element of these obligations is charged to the profit and loss account over the relevant period. The capital element of the future payments is treated as a liability.

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

Pension costs and other post-retirement benefits

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

The contributions are recognised as an expense in the Statement of Comprehensive Income when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the company in an independently administered fund.

Derivative financial instruments

The company uses forward foreign currency contracts to reduce exposure to foreign exchange rates.

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 and loss in finance costs or income as appropriate.

The company does not currently apply hedge accounting for foreign exchange derivatives.

Trade debtors

Trade and other debtors are initially recognised at the transaction price and thereafter stated at amortised cost using the effective interest method, less impairment losses for bad and doubtful debts except where the effect of discounting would be immaterial. In such cases, the debtors are stated at cost less impairment losses for bad and doubtful debts.

A provision for impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of debtors. The amount of the provision is determined as the difference between the asset's carrying amount and the present value of estimated future cash flows, and is recognised in the profit & loss in operating expenses.

Trade and other creditors

Trade and other creditors are initially recognised at fair value and thereafter stated at amortised cost using the effective interest method unless the effect of discounting would be immaterial, in which case they are stated at cost.

Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and on hand, demand deposits with banks and other short-term highly liquid investments with original maturities of three months or less and bank overdrafts. In the balance sheet, bank overdrafts are shown within borrowings or current liabilities when applicable.

Basic financial instruments

The company enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable, loans from banks and other third parties, loans to related parties.

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

Provisions for liabilities

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

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

Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value using a pre-tax discount rate. The unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.

The company recognises a provision for annual leave accrued by employees as a result of services rendered in the current period, and which employees are entitled to carry forward and use within the next 12 months. The provision is measured at the salary cost payable for the period of absence.

3.

TURNOVER

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

An analysis of turnover by geographical market is given below:

2025

2024

£

£

United Kingdom

27,012,591

28,353,742

Europe

641,617

857,500

Rest of the world

256,771

234,671

27,910,979

29,445,913

4.	EMPLOYEES AND DIRECTORS

2025

2024

£

£

Wages and salaries

3,547,725

3,615,813

Social security costs

441,387

388,786

Other pension costs

177,163

185,040

4,166,275

4,189,639

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

2025

2024

Directors

6

6

Office and management

39

42

Sales

7

7

Warehouse and production staff

48

51

100

106

2025

2024

£

£

Directors' remuneration

954,074

1,061,285

Directors' pension contributions to money purchase schemes

120,000

120,000

Information regarding the highest paid director is as follows:

2025

2024

£

£

Emoluments etc

433,941

473,710

5.	OPERATING (LOSS)/PROFIT

The operating loss (2024 - operating profit) is stated after charging/(crediting):

2025

2024

£

£

Other operating leases

554,583

617,398

Depreciation - owned assets

266,749

257,044

Profit on disposal of fixed assets

(40,588

)

(7,565

)

Foreign exchange differences

43,202

(67,083

)

6.	AUDITORS' REMUNERATION

Fees payable to the company's auditors are:

Year Ended

Year Ended

31/12/25

31/12/24

£

£

Audit of the company's financial statements

49,484

50,641

Tax compliance

27,101

26,059

Other services

29,412

46,086

105,997

122,786

7.

TAXATION

Analysis of the tax charge/(credit)

The tax charge/(credit) on the profit for the year was as follows:

2025

2024

£

£

Current tax:

UK corporation tax

17,434

-

Receipt in respect of group relief

-

(25,101

)

Payment in respect of group relief

15,295

-

Total current tax

32,729

(25,101

)

Deferred tax

(22,034

)

(10,721

)

Tax on profit

10,695

(35,822

)

UK corporation tax has been charged at 25% (2024 - 25%).

Reconciliation of total tax charge/(credit) included in profit and loss

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

2025

2024

£

£

Profit before tax

35,409

29,896

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

8,852

7,474

Effects of:

Expenses not deductible for tax purposes

1,187

1,732

Capital allowances in excess of depreciation

-

(45,028

)

Depreciation in excess of capital allowances

656

-

Total tax charge/(credit)

10,695

(35,822

)