Registered number: 01156673
FOR THE YEAR ENDED 31 DECEMBER 2025
COMPANY INFORMATION
CONTENTS
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2025
The directors present their Strategic Report for the year ended 31 December 2025.
Mills CNC Limited (“Mills CNC”) is the main operating company within the group and is primarily involved in the marketing, distribution and after sales servicing of CNC machines and is recognised as a market leader within this sector.
The group has established a very balanced portfolio of clients across a wide range of UK & Ireland manufacturing sectors.
Furthermore, Mills CNC is clearly recognised as one of the leading UK and Irish suppliers across many machine tool technology sectors (lathes, vertical machining centres, horizontal machining centres, mill-turn, 5-axis etc.) with an equal reputation in customer support, both pre and post-delivery.
At the heart of this success has been the company’s relentless determination to continually improve its customer service across all of its business and thereby capitalise on the already excellent market reputation.
The company has continued to expand its facilities giving it the ability to be agile to its customer needs with a continuous emphasis on delivering the best technology, training, service and support.
The company’s dedicated Training Academy, which in early 2024 moved to newly refurbished classrooms with the latest AV technology, continues to be a first class offering to customers.
The company has continued to enhance its technological ability and capacity within its automation division. Across a range of diverse sectors our customers have benefited from significant improvements in productivity and hence their competitiveness in their markets.
Product innovation by our supplier, D N Solutions, continues to firmly place the machines that we sell as amongst the world's best, in their class.
The directors will continue to build upon the great progress to date to deliver even greater value for our customers and in turn success to our business.
Like 2024, 2025 was another challenging year with a series of geopolitical and economic events influencing customers confidence to invest. Despite this the directors have been pleased with the quality and diversity of work secured in the year, the resilience of our customer base to adapt to the challenges and therefore the outlook for the future remains strong.
As always, we owe the greatest thanks to our entire workforce, our customers and the team at D N Solutions, all of whom play a vital part in our achievements.
The group has established a very balanced portfolio of clients across a wide range of UK & Ireland manufacturing sectors.
Furthermore, Mills CNC is clearly recognised as one of the leading UK and Irish suppliers across many machine tool technology sectors (lathes, vertical machining centres, horizontal machining centres, mill-turn, 5-axis etc.) with an equal reputation in customer support, both pre and post-delivery.
At the heart of this success has been the company’s relentless determination to continually improve its customer service across all of its business and thereby capitalise on the already excellent market reputation.
The company has continued to expand its facilities giving it the ability to be agile to its customer needs with a continuous emphasis on delivering the best technology, training, service and support.
The company’s dedicated Training Academy, which in early 2024 moved to newly refurbished classrooms with the latest AV technology, continues to be a first class offering to customers.
The company has continued to enhance its technological ability and capacity within its automation division. Across a range of diverse sectors our customers have benefited from significant improvements in productivity and hence their competitiveness in their markets.
Product innovation by our supplier, D N Solutions, continues to firmly place the machines that we sell as amongst the world's best, in their class.
The directors will continue to build upon the great progress to date to deliver even greater value for our customers and in turn success to our business.
Like 2024, 2025 was another challenging year with a series of geopolitical and economic events influencing customers confidence to invest. Despite this the directors have been pleased with the quality and diversity of work secured in the year, the resilience of our customer base to adapt to the challenges and therefore the outlook for the future remains strong.
As always, we owe the greatest thanks to our entire workforce, our customers and the team at D N Solutions, all of whom play a vital part in our achievements.
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STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
We consider that our key financial performance indicators are those that communicate the financial performance and strength of the group, these being turnover and earnings before amortisation, depreciation, interest and tax (EBITDA).
The board also monitors the level of stock held against the level of associated import trade debt. This relationship is key in optimising liquidity.
Company turnover at £62.0m was down from the £64.4m it achieved in 2024. The geopolitical and economic landscape remained unstable throughout 2025 and so whilst the majority of customers remained busy their confidence levels remained subdued. Nonetheless, there are signs that an appetite to invest is returning. With a balanced portfolio of clients, in a broad range of manufacturing sectors across UK and Ireland, the company is well placed to react to this. The company’s policy of holding stock and developing solutions for customers rather than just supplying product enables the company to respond to this increased demand as it comes.
The company achieved EBITDA of £4.8m (2024: £6.0m). The reduction in EBITDA is linked to the fall in revenue combined with the strategy of maintaining and investing in capacity.
At the end of the year, the company had net assets of £23,305,986 (2024: £22,478,618).
The board also monitors the level of stock held against the level of associated import trade debt. This relationship is key in optimising liquidity.
Company turnover at £62.0m was down from the £64.4m it achieved in 2024. The geopolitical and economic landscape remained unstable throughout 2025 and so whilst the majority of customers remained busy their confidence levels remained subdued. Nonetheless, there are signs that an appetite to invest is returning. With a balanced portfolio of clients, in a broad range of manufacturing sectors across UK and Ireland, the company is well placed to react to this. The company’s policy of holding stock and developing solutions for customers rather than just supplying product enables the company to respond to this increased demand as it comes.
The company achieved EBITDA of £4.8m (2024: £6.0m). The reduction in EBITDA is linked to the fall in revenue combined with the strategy of maintaining and investing in capacity.
At the end of the year, the company had net assets of £23,305,986 (2024: £22,478,618).
Non Financial key performance indicators
The Board monitors on a monthly basis the responses from its regular customer feedback and employee satisfaction surveys.
Principal risks and uncertainties
The Board monitors on a monthly basis the responses from its regular customer feedback and employee satisfaction surveys.
Principal risks and uncertainties
Significant Key Supplier
A significant majority of the company’s revenue is derived from the distribution of D N Solutions Machine Tools supplied by D N Solutions Co. Ltd based in Korea.
The board acknowledges that should this relationship deteriorate or breakdown this could have a significant adverse effect on our business. However, this relationship is very strong based on its longevity (over 30 years), legal standing and above all cultural match ensuring both parties prosper.
Global Trade Tariffs
Although there are no signs that tariffs will significantly change with our direct suppliers the directors are aware of the possible impact further down our supply chains and also within our customer base. As always the company will remain agile and innovative to mitigate the risks and even be ready to take advantage of the opportunities that could present themselves for our customer base.
Financial instrument risk
The company's principal financial instruments comprise an import loan facility, bank loans, preferred shares treated as debt, cash and short-term deposits. The purpose of these financial instruments is to raise finance for the company's operations. The company has various other financial instruments such as trade debtors and trade creditors, which arise directly from its operations.
The main risks arising from the company's financial instruments are interest rate risk, liquidity risk, foreign currency risk, and credit risk. The board reviews and agrees policies for managing each of these risks and they are summarised below:
The company's principal financial instruments comprise an import loan facility, bank loans, preferred shares treated as debt, cash and short-term deposits. The purpose of these financial instruments is to raise finance for the company's operations. The company has various other financial instruments such as trade debtors and trade creditors, which arise directly from its operations.
The main risks arising from the company's financial instruments are interest rate risk, liquidity risk, foreign currency risk, and credit risk. The board reviews and agrees policies for managing each of these risks and they are summarised below:
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STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Financial risk management objectives and policies (continued)
Interest rate risk
The company finances its operations through a mixture of shareholders' equity and borrowings. The company's exposure to interest rate fluctuations on its borrowings is reduced by the periodic use of interest rate swaps and caps. Cash reserves are placed on deposit and earn interest which partially hedges the exposure for further interest rate rises. Details of the bank loans and preference shares treated as debt are given within the notes to the financial statements.
The company finances its operations through a mixture of shareholders' equity and borrowings. The company's exposure to interest rate fluctuations on its borrowings is reduced by the periodic use of interest rate swaps and caps. Cash reserves are placed on deposit and earn interest which partially hedges the exposure for further interest rate rises. Details of the bank loans and preference shares treated as debt are given within the notes to the financial statements.
Liquidity risk
The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably. The company holds banking facilities with HSBC UK Bank Plc which secures its liquidity and ability to invest in the future growth of the business. These facilities were renewed in October 2025. Letters of credit, import loans and trade credit facilities are used to finance the purchase of CNC machines.
Foreign currency risk
The company purchases CNC machines from D N Solutions Machine Tools based in Korea. In order to minimise the foreign currency risk with these transactions, D N Solutions invoices the group in sterling.
Credit risk
The company trades with only recognised, creditworthy, third parties. It is the group's policy that all customers who wish to trade on credit terms are subject to credit vetting procedures. In addition, receivable balances are monitored on an ongoing basis with the result that the group's exposure to bad debts is not significant.
The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably. The company holds banking facilities with HSBC UK Bank Plc which secures its liquidity and ability to invest in the future growth of the business. These facilities were renewed in October 2025. Letters of credit, import loans and trade credit facilities are used to finance the purchase of CNC machines.
Foreign currency risk
The company purchases CNC machines from D N Solutions Machine Tools based in Korea. In order to minimise the foreign currency risk with these transactions, D N Solutions invoices the group in sterling.
Credit risk
The company trades with only recognised, creditworthy, third parties. It is the group's policy that all customers who wish to trade on credit terms are subject to credit vetting procedures. In addition, receivable balances are monitored on an ongoing basis with the result that the group's exposure to bad debts is not significant.
The directors of the company, as those of all UK companies, must act in accordance with a set of general duties which are detailed in section 172 of the Companies Act 2006. These duties include a duty by the directors of the company to act in a way they consider, in good faith, would be most likely to promote the success of the company for the benefit of its shareholders as a whole and, in doing so, have had regard to and recognised the importance of considering all stakeholders and other matters in its decision making.
As part of their induction, a director is briefed on their duties and they can access professional advice on these, either through the company or, if they judge it necessary, from an independent provider. Ongoing training is provided to directors to ensure that their knowledge remains up to date so that they can continue to perform their duties. It is important to recognise that in a large company such as ours, the directors fulfil their duties partly through a governance framework that delegates day to day decision making to employees of the company.
Engagement with our stakeholders
Shareholders
Our shareholders are key to the future success of the business, providing funds which aid business growth and stability. The directors provide information on company strategy and performance, being honest and transparent at all times. Value is generated for shareholders by supporting the company to deliver the business plan. Shareholders are able to ask questions regarding the business and are provided with a copy of the Annual Report and Financial Statements for the company.
Suppliers
The company has a broad range of suppliers both globally and throughout the UK & Ireland. We work in collaboration with all our suppliers to not only ensure we treat each other fairly in our business arrangements but that we drive high standards and reduce risk in our supply chain whilst benefiting from cost efficiencies and positive environmental outcomes.
As part of their induction, a director is briefed on their duties and they can access professional advice on these, either through the company or, if they judge it necessary, from an independent provider. Ongoing training is provided to directors to ensure that their knowledge remains up to date so that they can continue to perform their duties. It is important to recognise that in a large company such as ours, the directors fulfil their duties partly through a governance framework that delegates day to day decision making to employees of the company.
Engagement with our stakeholders
Shareholders
Our shareholders are key to the future success of the business, providing funds which aid business growth and stability. The directors provide information on company strategy and performance, being honest and transparent at all times. Value is generated for shareholders by supporting the company to deliver the business plan. Shareholders are able to ask questions regarding the business and are provided with a copy of the Annual Report and Financial Statements for the company.
Suppliers
The company has a broad range of suppliers both globally and throughout the UK & Ireland. We work in collaboration with all our suppliers to not only ensure we treat each other fairly in our business arrangements but that we drive high standards and reduce risk in our supply chain whilst benefiting from cost efficiencies and positive environmental outcomes.
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STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Directors' statement of compliance with duty to promote the success of the company (continued)
Customers
A close working relationship with our customers helps us to better understand their needs and provide suitable and reliable products and service support. Our talented teams are dedicated to making sure we constantly refine what we do, providing confidence with delivery of everything we do. It is this employee experience, expertise and creativity that is what our customers seek.
A close working relationship with our customers helps us to better understand their needs and provide suitable and reliable products and service support. Our talented teams are dedicated to making sure we constantly refine what we do, providing confidence with delivery of everything we do. It is this employee experience, expertise and creativity that is what our customers seek.
Community
By contributing to the wider society this enables us to create stronger communities and have a positive environmental impact. The company’s approach to environmental and social matters is of high importance. As a national but predominantly remotely operated business we rely on our: workforce, suppliers and customers to help drive local initiatives where our support can make a positive impact.
Employees
We continually invest in employee training, development and well-being. The company engages with employees via a variety of information, consultation and participation activities. Information is shared through regular operational team briefings, board meetings, written updates and open forum Q&A sessions. Directors regularly visit all site areas providing the opportunity for employee engagement. Department managers are regularly invited to board meetings to discuss their departments performance and future development. Engaging with our employees enables us to create an inclusive culture and a positive working environment.
We continually invest in employee training, development and well-being. The company engages with employees via a variety of information, consultation and participation activities. Information is shared through regular operational team briefings, board meetings, written updates and open forum Q&A sessions. Directors regularly visit all site areas providing the opportunity for employee engagement. Department managers are regularly invited to board meetings to discuss their departments performance and future development. Engaging with our employees enables us to create an inclusive culture and a positive working environment.
This report was approved by the board and signed on its behalf.
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DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2025
The directors present their report and the financial statements for the year ended 31 December 2025.
The company is primarily involved in the marketing, distribution and after sales servicing of CNC machine tools and is recognised as a market leader within this sector.
The profit for the year, after taxation, amounted to £2,656,365 (2024: £3,788,414).
The directors who served during the year, and up to the date of signing this report, were:
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MILLS CNC LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
This disclosure provides the emission data and supporting information required by The Companies Act 2006 (Strategic Report and Directors Report) Regulations 2013 and The Companies (Director's Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018; the latter commonly referred to as Streamlined Energy & Carbon Reporting (SECR).
Footprint Boundary
The Mills CNC Group (encompassing Mills CNC Limited, Mills CNC Finance Limited, Mills CNC Automation Limited, Ensco 1066 Limited and Ensco 1772 Limited) has adopted an operational control approach to define its Greenhouse Gas (GHG) emissions boundary, in line with the UK Government’s latest Environmental Reporting guidance; “Your organisation has operational control over an operation if it, or one of its subsidiaries, has the full authority to introduce and implement is operating policies at the operation”.
For the Mills CNC Group these include emissions associated with the operation of all buildings plus company owned and leased transport. The company has chosen to elect 2020 as its baseline year for comparison.
Emission Sources
All material scope emissions are included. These include emissions associated with:
• Fuel Combustion; Stationary (Natural Gas); Mobile (Vehicle Fuel)
• Purchased Electricity
Footprint Boundary
The Mills CNC Group (encompassing Mills CNC Limited, Mills CNC Finance Limited, Mills CNC Automation Limited, Ensco 1066 Limited and Ensco 1772 Limited) has adopted an operational control approach to define its Greenhouse Gas (GHG) emissions boundary, in line with the UK Government’s latest Environmental Reporting guidance; “Your organisation has operational control over an operation if it, or one of its subsidiaries, has the full authority to introduce and implement is operating policies at the operation”.
For the Mills CNC Group these include emissions associated with the operation of all buildings plus company owned and leased transport. The company has chosen to elect 2020 as its baseline year for comparison.
Emission Sources
All material scope emissions are included. These include emissions associated with:
• Fuel Combustion; Stationary (Natural Gas); Mobile (Vehicle Fuel)
• Purchased Electricity
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MILLS CNC LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Greenhouse gas emissions, energy consumption and energy efficiency action (continued)
Methodology and Emission Factors
The methodology and emission factors have been taken from the UK Government GHG Conversion factors for company reporting, issued by Department for Business, Energy & Industrial Strategy, for the respective years 2023, 2024 and 2025. The basis for our intensity ratio is based on turnover for each respective year i.e. 2025: £62.0m; 2024: £64.4m and; 2023: £76.4m.
Methodology and Emission Factors
The methodology and emission factors have been taken from the UK Government GHG Conversion factors for company reporting, issued by Department for Business, Energy & Industrial Strategy, for the respective years 2023, 2024 and 2025. The basis for our intensity ratio is based on turnover for each respective year i.e. 2025: £62.0m; 2024: £64.4m and; 2023: £76.4m.
*Due to a small methodology change to include all greenhouse gases rather than just CO2 management have restated figures for 2024 and 2023 to provide true and fair comparatives
Since April 2019 our purchased electricity supplier has “100% Guaranteed Renewable Energy”. This statement has been independently verified in line with the GHG Protocol Scope 2 Guidance (2015).
The GHG Protocol Scope 2 Guidance addendum (2015) requires companies claiming low carbon electricity consumption to ensure that such usage is matched by ‘contractual instruments’. These instruments must meet the Quality Criteria which are set out in the addendum.
To assist interpretation, we have shown the theoretical GHG tCO2e of purchased electricity if it had not been 100% renewable; we have then shown the amount to be deducted as 100% renewable.
Environmental Statement
Mills CNC Group is committed in all respects to acting in an environmentally responsible manner and to promoting sustainability of the Earth and its resources. To this end, we focus not only on continually improving our operational practices and process to minimise our impact on the environment; we also work with our supply chain and customers to develop or improve our products so that we can provide goods and services that are energy-efficient and environmentally friendly. We strive to manage our business to minimise our environmental footprint. We work with our waste management partners to maximise the proportion of our waste that can be recycled.
Since April 2019 our purchased electricity supplier has “100% Guaranteed Renewable Energy”. This statement has been independently verified in line with the GHG Protocol Scope 2 Guidance (2015).
The GHG Protocol Scope 2 Guidance addendum (2015) requires companies claiming low carbon electricity consumption to ensure that such usage is matched by ‘contractual instruments’. These instruments must meet the Quality Criteria which are set out in the addendum.
To assist interpretation, we have shown the theoretical GHG tCO2e of purchased electricity if it had not been 100% renewable; we have then shown the amount to be deducted as 100% renewable.
Environmental Statement
Mills CNC Group is committed in all respects to acting in an environmentally responsible manner and to promoting sustainability of the Earth and its resources. To this end, we focus not only on continually improving our operational practices and process to minimise our impact on the environment; we also work with our supply chain and customers to develop or improve our products so that we can provide goods and services that are energy-efficient and environmentally friendly. We strive to manage our business to minimise our environmental footprint. We work with our waste management partners to maximise the proportion of our waste that can be recycled.
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MILLS CNC LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Environmental Statement (continued)
As part of this on-going improvement in April 2019 we attained ISO 14001 (Environmental Management System).
Going forward the company will continue to review our energy consumption. Future and on-going initiatives include:
As part of this on-going improvement in April 2019 we attained ISO 14001 (Environmental Management System).
Going forward the company will continue to review our energy consumption. Future and on-going initiatives include:
∙Investing in electric vehicles for passenger and goods transportation;
∙Encouraging the use of technology to reduce face to face meetings which require the need to travel by plane or motor vehicle;
∙Work with our landlord to replace existing building infrastructure and facilities with energy-efficient and environmentally friendly products and materials. Including but not limited to heating, lighting, insulation and audio-visual equipment; and
∙We are currently working with our landlord on a project to install solar panels on all our units in Leamington Spa.
The group has a number of banking facilities with HSBC UK Bank Plc. These secure liquidity and the ability to invest in the future growth of the business.
The directors have prepared detailed cash flow forecasts at the level of Ensco 1772 Limited, of which this company is a part of. These forecasts show that after considering reasonable downside scenarios, the group has sufficient funds to support their activities and meet their liabilities as they fall due based on forecasted trading levels and that the funding is held for a period of at least 12 months from the date of signing these financial statements. As part of the Directors' consideration of downside scenarios, they have run reverse stress tests on the cash flow, Profit and Loss and covenant forecasts that they deem to be implausible.
In preparing these forecasts the directors have taken into consideration the current macro economic climate. There have been inflationary cost pressures within our supply chain, but we have and will continue to work hard with our suppliers to minimize the impact of these on our customers.
Global tariff uncertainty has limited direct impact on our costs or onward sales but we are aware of the potential adverse impact to our customers and have modelled those uncertainties into our projections.
Local and global interest rates have stabilised in the last year and the expectation is that they will remain stable; however, we have profiled interest rate rise sensitivity into our assumptions.
The directors have received confirmation from the parent, Ensco 1772 Limited, that it is the intention to provide financial support, should it be required, to at least 31 December 2027 to enable Mills CNC Limited to meet its financial liabilities.
On the basis set out above, the directors continue to adopt the going concern basis of preparation for these financial statements.
The directors have prepared detailed cash flow forecasts at the level of Ensco 1772 Limited, of which this company is a part of. These forecasts show that after considering reasonable downside scenarios, the group has sufficient funds to support their activities and meet their liabilities as they fall due based on forecasted trading levels and that the funding is held for a period of at least 12 months from the date of signing these financial statements. As part of the Directors' consideration of downside scenarios, they have run reverse stress tests on the cash flow, Profit and Loss and covenant forecasts that they deem to be implausible.
In preparing these forecasts the directors have taken into consideration the current macro economic climate. There have been inflationary cost pressures within our supply chain, but we have and will continue to work hard with our suppliers to minimize the impact of these on our customers.
Global tariff uncertainty has limited direct impact on our costs or onward sales but we are aware of the potential adverse impact to our customers and have modelled those uncertainties into our projections.
Local and global interest rates have stabilised in the last year and the expectation is that they will remain stable; however, we have profiled interest rate rise sensitivity into our assumptions.
The directors have received confirmation from the parent, Ensco 1772 Limited, that it is the intention to provide financial support, should it be required, to at least 31 December 2027 to enable Mills CNC Limited to meet its financial liabilities.
On the basis set out above, the directors continue to adopt the going concern basis of preparation for these financial statements.
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MILLS CNC LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
On 29th January 2026 the Group was able to secure additional funding from HSBC UK Bank Plc which along with its own cash reserves enabled it to fully settle the Loan Notes B which were a liability of the ultimate holding company Ensco 1772 Limited.
The auditor, Grant Thornton UK LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MILLS CNC LIMITED
We are responsible for concluding on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify the auditor’s opinion. Our conclusions are based on the audit evidence obtained up to the date of our report. However, future events or conditions may cause the company to cease to continue as a going concern.
In our evaluation of the directors' conclusions, we considered the inherent risks associated with the company's business model including effects arising from macro-economic uncertainties such as the cost of living crisis and the US conflict with Iran, we assessed and challenged the reasonableness of estimates made by the directors and the related disclosures and analysed how those risks might affect the company's financial resources or ability to continue operations over the going concern period.
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.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MILLS CNC LIMITED (CONTINUED)
Conclusions relating to going concern (continued)
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.
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.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MILLS CNC LIMITED (CONTINUED)
Matters on which we are required to report by exception
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MILLS CNC LIMITED (CONTINUED)
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MILLS CNC LIMITED (CONTINUED)
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 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 company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Senior Statutory Auditor
for and on behalf of Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
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STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2025
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STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2025
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 18 to 35 form part of these financial statements.
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STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Mills CNC Limited is a private company limited by shares, incorporated in England and Wales. Registered number 01156673. Its registered head office is located at Units 2 & 3 Tachbrook Link, Tachbrook Park Drive, Leamington Spa, Warwickshire, England, CV34 6SN.
2.Accounting policies
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the company's accounting policies (see note 3).
The following principal accounting policies have been applied:
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 7 paragraph 7.20C relating to Supplier Finance Arrangements;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
∙the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
∙the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
∙the requirements of Section 26 Share-based Payment paragraphs 26.18(b), 26.19 to 26.21 and 26.23; and
∙the requirements of Section 33 Related Party Disclosures paragraph 33.7.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
The directors have received confirmation from the parent, Ensco 1772 Limited, that it is the intention to provide financial support, should it be required, to at least 31 December 2027 to enable Mills CNC Limited to meet its financial liabilities.
The company's functional and presentation currency is GBP and all values are rounded to the nearest pound (£) except where otherwise stated..
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end, foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Comprehensive Income.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the profit or loss within 'finance income or costs'. All other foreign exchange gains and losses are presented in the Statement of Comprehensive Income within 'administrative expenses'.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
Sale of goods (machines and parts)
Machine sales are accounted for upon delivery of the machine to the customer or the date title passes to the customer if earlier.
Part sales are accounted for upon despatch of the goods to the customer.
Income relating to service and maintenance contracts is recognised when the activity takes place and the work is completed. Turnover in respect of services is recognised when the service has been provided in full.
Revenue from a contract to provide services is recognised in the period in which the services are provided when the amount of revenue can be measured reliably and it is probable that the company will receive the consideration due under the contract.
Where consideration is received in advance of the criteria for revenue recognition having been met, that consideration is deferred as a liability in the Statement of Financial Position until such a point that the revenue recognition criteria is fully satisfied.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight line basis over the period of the lease.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
The fair value of the equity share options is expensed over the vesting period, with a corresponding increase in equity. The expense is recognised in the income statement, with a corresponding increase in equity, over the vesting period.
Any modifications to the equity share option scheme are accounted for as a continuation of the original grant, with the fair value of the modified equity share options being recognised over the remaining vesting period.
Upon exercise of the equity share options, the proceeds received net of any directly attributable transaction costs, together with the related balance in the share option reserve, are credited to share capital and share premium when the options are exercised. Any consideration received in excess of the share capital and share premium is recognised in retained earnings.
Upon the lapse or cancellation of equity share options, the related balance in the share option reserve is transferred to retained earnings.
The equity share option scheme is subject to regular assessment and disclosure in the financial statements in accordance with the requirements of FRS 102.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
Basic financial assets
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
Derecognition of financial assets
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
Where specific claims have been received that are outside of the warranty terms, but for which the company has an obligation to rectify a problem, then a rectification provision is made based on the best estimate of the costs involved.
Estimates and underlying assumptions are reviewed on an ongoing basis. Estimates are based on historical experience and other assumptions that are considered reasonable in the circumstances. The actual amount or values may vary in certain instances from the assumptions and estimates made. Changes will be recorded, with corresponding effect in the financial statements, when, and if, better information is obtained.
Critical judgements and sources of estimation uncertainty that management have made in the process of applying accounting policies disclosed herein and that have a significant effect on the amounts recognised in the financial statements relate to the following:
Estimates
Stock provisions (see note 14)
Management considers the year end stock quantities on a line by line basis including: the age of that stock, the usage over the last 48 months and orders in hand, in order to assess the level of provision required.
Warranty provisions (see note 18)
Management assesses the need for warranty provisions based on the number and value of machines still under warranty, the warranty period remaining, and historical levels of warranty costs for similar machines and customers.
Share-based payments (see note 22)
The company's ultimate parent issues equity settled share-based payments to certain employees. Equity settled share-based payments are measured at fair value at the date of grant. The fair value determined at the grant date of the equity settled share-based payments is expensed over the vesting period, based on the company’s estimate of the awards that will eventually vest. Fair value is measured by use of the Black-Scholes pricing model.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
3.Judgements in applying accounting policies (continued)
In the process of preparing the financial statements, no significant judgements were applied.
Analysis of turnover by country of destination:
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
11.Taxation (continued)
Deferred tax balances have been measured at 25%, being the enacted UK corporation tax rate applicable to future periods at the balance sheet date.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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Page 33
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Capital contribution reserve
Profit & loss account
The group also has bank guarantees in place at the year end of £509,222 (2024: £332,400) and bank loans outstanding at the year end of £3,000,000 (2024: £1,937,500).
The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund and amounted to £648,779 (2024: £537,065 ). Contributions totalling £Nil (2024: £Nil) were payable to the fund at the Statement of Financial Position date.
Page 34
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
The parent undertaking of the largest and smallest group for which consolidated accounts are prepared is
Page 35