The trustee present their annual report and financial statements for the year ended 31 December 2025.
The financial statements have been prepared in accordance with the accounting policies set out in note 1 to the financial statements and comply with the charitable company's governing document, the Companies Act 2006, FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Charities SORP "Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)".
The principle activity of the charity is the advancement of education for the public benefit, on the history, social history, heritage, economy, geology, geography, archaeology, architecture and other features of the Dudley canal tunnels, inland waterways, mines and its working boats; and the protection, preservation, conservation, maintenance, repair, improvement and development, to a navigable standard, of the Dudley canal tunnels, inland waterways, mines and working boats for the use and benefit of the public.
The strategies employed to achieve the charity's objectives are to:
Develop an ambitious and forward-looking heritage attraction that celebrates its past achievements whilst looking to grow its infrastructure, develop its offer, reach a wider audience and be a vibrant part of the local community where it is situated.
Offer opportunities for a broad range of people to become involved and engaged with the history of the tunnels, caverns, waterways and local area. This will be through offering boat trips into the tunnels on open water along with exhibitions and workshops, displays, events, talks, audio visual displays and hands on opportunities.
Provide employment and volunteer opportunities and work with local community groups and networks and make our resources available to help them deliver their goals.
Develop and deliver great quality formal and informal education activities for all ages. Become better known for our insight and creative use of our history, our resources, stories and our staff to produce specialist interpretive programs as well as family friendly and curriculum supporting workshops.
Preserve the Caverns, Tunnels, Mines and Waterways under our care to the highest level. Developing specialist knowledge and approaches to this and sharing knowledge with the wider sector as best practice. Developing a stringent health and safety approach that ensures the safety of all who visit and work within the premises.
To raise income through our activities to ensure we stay a viable and sustainable business and can further invest in the business. This can be done by selling trip tickets, commercial trade, promoting donations, gift aid and fundraising for our activities.
To develop mutually supportive partnerships, project work and build relationships which adds to our offer, promotes what is so special about the area and help upskill our workforce, volunteers, operating approaches and activities.
To raise the profile and awareness of the Trust and ensure all see us as an engaging, productive and professional organisation and heritage attraction. To operate with entrepreneurial flair and creativity and to trade ethically and fairly in all we do.
To put the visitor at the heart of everything we do.
The trustee have paid due regard to guidance issued by the Charity Commission in deciding what activities the charitable company should undertake.
Executive Summary
2025 was a year of considerable change. One which saw the Trust launch its new vision, reconcile its core offer and focus on providing a strong base from which to ensure the long-term sustainability of the Charity.
The first six months, saw considerable growth with a new Easter event surpassing expectations and delivering a profit-making position significantly earlier in the year than usual.
July marked a turning point, notably a necessary temporary closure of the Gongoozler cafe. Following extensive engagement with the relevant bodies and the Board of Trustees, the decision was made to expedite the long-term vision for the entire Trust and in turn the closure of the Gongoozler was formalised and made permanent.
This closure began the process of consolidation of the operating model, including staff, customer offer and visitor flow. A new coffee shop joined with the retail offer on the ground floor, creating a centralised visitor offer for our service users engaged in our Charitable purpose. Minor refurbishment work was undertaken in all the upstairs spaces to create community and commericial options to help diversify the offer, and an important strategic decision was made to move the Trust available hours to a seven-day operation, protecting Mondays and Tuesdays for exclusive use by community and education groups.
This change had an immediate impact and educational bookings grew, and whilst revenue lost from the Gongoozler created the inevitable reduction in turnover, the corresponding impact to utilities and staffing created a better profitable position.
The post-summer holidays geopolitical circumstances created uncertainty amongst our visitor base and visitor number fell, this was a trend seen locally and nationally. However, the ongoing success created with Christmas and Halloween continued.
Visitor numbers from Black Country Living Museum were most impacted at the back end of the calendar, as the full impact of their capital project Forging Ahead reached its conclusion.
The change in the operating model resulted in key members of staff leaving the organisation, and a full re-organisation reached conclusion in early December. The new management team, whilst leaner, is now best placed to create a solid foundation to move forward into the new year.
We welcomed a new Trustee, Dave Rogers, who brings over 30 years of experience across the private sector, mental health, and education.
The Trust received a significant donation from the Black Country Museum Transport group during the year, and we were honoured to have been asked to be one of the founding Bostin’ Businesses on behalf of the Black Country Chamber of Commerce, which generated significant press attention at a regional level.
November saw the launch of our new vision, including the aspiration to explore the reopening of Wrens Nest Tunnel, the launch event was well attended by a number of high-profile stakeholders including the Mayor of the West Midlands Richard Parker, who gave support for our Trust and the impact it has had. Following this event, the Trust welcomed the National Lottery Heritage Fund with DMBC to showcase the site and our ambitious plans.
Total income for the year amounted to £915,536 (2024 £931,448). Total expenditure amounted to £ 957,777 (2024 £1,014,959). This resulted in a net deficit for the year of £42,067 (2024 net deficit £83,569). The 2024 deficit included a £70,000 overpayment of the rent to a sister charity, Dudley Canal Trust (Trips), enabling a reduction in loan repayments by the sister charity, which will be of long-term benefit to our charity: hence, with this taken into account, the 2024 result was a £13,569 deficit.
Our unrestricted funds are freely available to spend on any of the charity’s purposes in delivering our aims and keeping our business sustainable. Restricted funds and tangible fixed assets do not form part of our reserves. They are in place to protect the charity and its operations during down turns in business or other major occurrence to ensure it can continue to protect and preserve the unique environment in its care and engage the public with its historic importance. Reserves are also used to support new projects and activities which the Trust has identified as part of its business development and planning.
The Trust aims to maintain a minimum of reserves. This is based upon the budgeted next three expenditure months (or four months at the end of November) for non-discretionary spending. Where funds fall below this amount the Trust will review a “Zero Level” approach, identifying the associated risks and mitigating them, building back reserves and diversifying the funding base.
Our policy has been a consistent £300,000 throughout the year; however, with a new operating model this level is lower and now varies during the year. At the end of December, the policy was £155,000 and our readily available cash reserves are £272,701 which is slightly above our policy.
To assist with the maintenance of the caverns, mines and canals in the area of our operations, there is a Maintenance Fund held along with Dudley Metropolitan Borough Council and Canal & River Trust. This Fund is not shown in our accounts, and is currently in the region of £600,000.
Risk management
The trustees have reviewed the major risks to which the charity is exposed and confirm that systems have been established to mitigate those risks. Particular attention has focused on non-financial risks arising from fire, health and safety of staff, trippers and audiences. A key element in the management of financial risk is the ongoing commitment to gain an increasing number of visitors by offering deals through various mediums, together with attending various community events.
The company is limited by guarantee and hence there is no share capital.
Dudley Canal and Tunnel Trust is governed by its Memorandum and Articles of Association dated 18 September 2015. It is a registered charity with the Charity Commission.
The trustee, who are also the directors for the purpose of company law, and who served during the year and up to the date of signature of the financial statements were:
In recruiting Trustees, the selection is based upon the skills, experience, and qualities needed to complement the existing board and meet the strategic needs of the Trust. Any vacancy is advertised using appropriate channels, with possible candidates interviewed. Following the interview process, any recommendations are taken to the board, and the final decision is made by the full board of Trustees. Successful candidates are formally invited to join the board, subject to the completion of necessary formalities including a DBS check. All information received in the course of the recruitment process is treated as confidential and processed in accordance with data protection policies.
The board of trustees, who meet bi-monthly administer the charity.
A Chief Executive is appointed by the Trustees to facilitate the strategic direction of the Trust, alongside the management of day-to-day operations. They attend the bi-monthly board meetings to present the Chief Executive's report on the running of the charity. A Finance and HR Lead looks after the Trust’s finances and supports the Chief Executive on all HR issues. A Programme & Creative Lead constructs the Trust’s customer programme to align to its charitable purposes. A Learning Engagement Officer is responsible for the Trust’s education offer. An Operations & Commercial Lead looks after the general day-to-day operation, with focus on boats, standards and health & safety requirements, alongside the commercial performance of the Trust. Part time roles in Volunteer Coordinator and Marketing Executive, support the Trust’s Volunteers function and Marketing function respectively. A new grading structure is in place with the Lead roles (3) reporting to the Chief Executive, with other management reporting to the Lead roles.
New trustees are briefed by the management regarding the operations and their legal obligations under charity and company law. They are also given a tunnel tour to obtain a better understanding of the company history and operations.
The charity has a wholly-owned subsidiary, Dudley Canal and Tunnel Trust Enterprises Limited, a limited company whose purpose is to raise monies through commercial enterprise with the aim of profit making so that these profits may be gifted to Dudley Canal and Tunnel Trust to support their charitable purposes.
The Trustees report was approved by the Board of Trustee.
I report to the trustee on my examination of the financial statements of Dudley Canal and Tunnel Trust (the charitable company) for the year ended 31 December 2025.
Having satisfied myself that the financial statements of the charitable company are not required to be audited under Part 16 of the Companies Act 2006 and are eligible for independent examination, I report in respect of my examination of the charitable company’s financial statements carried out under section 145 of the Charities Act 2011. In carrying out my examination I have followed the Directions given by the Charity Commission under section 145(5)(b) of the Charities Act 2011.
Since the charitable company’s gross income exceeded £250,000, the independent examiner must be a member of a body listed in section 145 of the Charities Act 2011. I confirm that I am qualified to undertake the examination because I am a member of ICAEW, which is one of the listed bodies.
I have completed my examination. I confirm that no matters have come to my attention in connection with the examination giving me cause to believe that in any material respect:
accounting records were not kept in respect of the charitable company as required by section 386 of the Companies Act 2006.
the financial statements do not accord with those records; or
the financial statements do not comply with the accounting requirements of section 396 of the Companies Act 2006 other than any requirement that the financial statements give a true and fair view, which is not a matter considered as part of an independent examination; or
the financial statements have not been prepared in accordance with the methods and principles of the Statement of Recommended Practice for accounting and reporting by charities applicable to charities preparing their financial statements in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102).
I have no concerns and have come across no other matters in connection with the examination to which attention should be drawn in this report in order to enable a proper understanding of the financial statements to be reached.
The statement of financial activities includes all gains and losses recognised in the year. All income and expenditure derive from continuing activities.
Dudley Canal and Tunnel Trust is a private company limited by guarantee incorporated in England and Wales. The registered office is 501 Birmingham New Road, Dudley, West Midlands, DY1 4SB.
The financial statements have been prepared in accordance with the charitable company's governing document, the Companies Act 2006, FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Charities SORP "Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)". The charitable company is a Public Benefit Entity as defined by FRS 102.
The financial statements are prepared in sterling, which is the functional currency of the charitable company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of certain financial instruments at fair value. The principal accounting policies adopted are set out below.
In the prior year, the charity prepared consolidated financial statements incorporating the results of its subsidiary undertaking.
In the current year, the charity has taken advantage of the exemption from preparing group accounts on the basis that the group does not exceed the income threshold of £1 million. Accordingly, these financial statements present the results and financial position of the charity as a single entity only.
As a consequence of the change in basis of preparation, the comparative figures have been restated to reflect the results and financial position of the charity alone, rather than the consolidated group.
At the time of approving the financial statements, the trustee have a reasonable expectation that the charitable company has adequate resources to continue in operational existence for the foreseeable future. Thus the trustee continue to adopt the going concern basis of accounting in preparing the financial statements.
Unrestricted funds are available for use at the discretion of the trustee in furtherance of their charitable objectives.
Restricted funds are subject to specific conditions by donors or grantors as to how they may be used. The purposes and uses of the restricted funds are set out in the notes to the financial statements.
Cash donations are recognised on receipt. Other donations are recognised once the charitable company has been notified of the donation, unless performance conditions require deferral of the amount. Income tax recoverable in relation to donations received under Gift Aid or deeds of covenant is recognised at the time of the donation.
Grants are included in incoming resources when they are receivable. Performance related grants are deferred and released after any performance conditions are met.
Expenditure is recognised once there is a legal or constructive obligation to transfer economic benefit to a third party, it is probable that a transfer of economic benefits will be required in settlement, and the amount of the obligation can be measured reliably.
Expenditure is classified by activity. The costs of each activity are made up of the total of direct costs and shared costs, including support costs involved in undertaking each activity. Direct costs attributable to a single activity are allocated directly to that activity. Shared costs which contribute to more than one activity and support costs which are not attributable to a single activity are apportioned between those activities on a basis consistent with the use of resources. Central staff costs are allocated on the basis of time spent, and depreciation charges are allocated on the portion of the asset’s use.
Tangible fixed assets 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 statement of financial activities.
Fixed asset investments are initially measured at transaction price excluding transaction costs, and are subsequently measured at fair value at each reporting date. Changes in fair value are recognised in net income/(expenditure) for the year. Transaction costs are expensed as incurred.
A subsidiary is an entity controlled by the charitable 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 charitable company 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).
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition. Items held for distribution at no or nominal consideration are measured the lower of replacement cost and cost.
Net realisable value is the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.
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.
The charitable company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the charitable company's balance sheet when the charitable company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Basic financial liabilities, including creditors and bank loans are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of operations from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the charitable company’s contractual obligations expire or are discharged or cancelled.
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 charitable company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Rentals payable under operating leases, including any lease incentives received, are charged as an expense on a straight line basis over the term of the relevant lease.
The average monthly number of employees during the year was:
The remuneration of key management personnel was as follows:
The Trust considers its key management personnel to be the Chief Executive.
The charity is exempt from taxation on its activities because all its income is applied for charitable purposes.
This is is made up of Café stock.
The charitable company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the charitable company in an independently administered fund.
The restricted funds of the charity comprise the unexpended balances of donations and grants held on trust subject to specific conditions by donors as to how they may be used.
The balance on the Historic England restricted funds includes £2,022 relating to fixed assets which are being depreciated on a 20% reducing balance basis.
The unrestricted funds of the charity comprise the unexpended balances of donations and grants which are not subject to specific conditions by donors and grantors as to how they may be used. These include designated funds which have been set aside out of unrestricted funds by the trustees for specific purposes.
At the reporting end date the charitable company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
During the year a trustee of the charity gained income from the charity through her professional services and wares amounting to £1,206 (2024: £1,075).
During the year the wife of a trustee of the charity gained income from the charity through selling her wares amounting to £755 (2024: £708).
These financial statements are separate charitable company financial statements for Dudley Canal and Tunnel Trust.
Details of the charitable company's subsidiaries at 31 December 2025 are as follows:
The investments in subsidiaries are all stated at cost.
The charitable company had no material debt during the year.