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

Business Strategy

On 25 August 2023 the Group purchased the entire share capital of Stephen James Alliance Limited, the holding company for a BMW retailer group.

In 2024 & 2025 management focused on the Group achieving economies of scale through the consolidation of these two businesses.

The Group’s strategy is to build premium brand automotive retail business that focuses on strong employee retention delivering high levels of customer service.

The current trading period of the Group was loss making due to:

• the UK entering a period of low growth in 2025;

• increased costs as a result of higher government taxation;

• the impact of a worldwide product recall in HY2 2024 resulting in low forward order bank;

• high cost of funds;

• continued sector challenges in meeting Government-mandeated Zero Emission Vehicle (ZEV) targets;

• one-off cost out reductions which will improve the group position moving forward;

• significant disruption and costs due to the redevelopment of one of our retail premises; and

• heightened competition from emerging Chinese automotive manufacturers.

Despite ongoing geopolitical and market uncertainties, the Directors remain optimistic that performance will improve in 2026 as trading normalises and the benefits of our investments are realised.

On 2 March 2026 the company issued 1 ordinary £1 share at a premium of £3,499,999.

All businesses have an element of risk and the Board maintains a policy of reviewing those risks which may cause the Group’s results to underperform against those of similar sized companies. The main risks are highlighted below:

1. Manufacturer Relationships

We have a close relationship with our manufacturer partners and seek to ensure that our respective goals are communicated, understood and aligned to deliver mutually acceptable level of performance.

2. Finance & Treasury

The Group relies on manufacturer funding lines to fund the purchase of new and used vehicles and these are expected to continue for the foreseeable future. As at 31 December 2025, vehicle funding facilities amounted to £70.7M.

ABN Amro Bank N.V. provides funding facilities totalling £33,625,000 as at the year end.

3. Economic conditions

The UK economy experience minimal growth during 2025, and the Group experienced a reduction in demand in the second half of the year as a result.

Trading conditions continue to be subdued in 2026. The Group expects to report a trading profit for the 2026 year following cost reductions and business improvements.

4. Regulatory risks

The Group’s insurance and finance activities are regulated by the Financial Conduct Authority.

Future developments

The Group continues to invest in its facilities to meet the demands of the consumer and its manufacturing partners.

The Board has regular reviews of the risks within each of the above categories and they consider the potential impact these would have on the business. The existing internal controls and accounting practices are deemed to be sufficient to deal with these issues should they arise.

Going concern

The directors have assessed the group’s and company’s ability to continue as a going concern over the period of at least 12 months from the date of approval of the financial statements. In making this assessment, the directors have considered the financial position of the UK group and companies in the context of the wider Hedin Mobility Group AB, together with the group’s financing arrangements, forecasts and available support.

Further information on the directors’ going concern assessment, including the basis on which the financial statements have been prepared, is set out in accounting policy 1.4.

The key financial and other performance indicators during the period were as follows:

The Board of Directors is accountable to shareholders for the management, performance and long-term success of the Group. The Board consider, both individually and together, that they have acted in the way most likely to promote the success of the Group for the benefit of its employees as a whole, whilst having regard to the wider stakeholders and matters set out in section 172 (1) (a) to (f) of the Companies Act 2006 in the decisions taken during the year ended 31 December 2025.

Consequences of long term decisions

The Board is aware that its strategic decisions have long term implications for the business and all of its stakeholders and these implications are carefully assessed.

Employee interests

The Board recognises that the long-term success of the Group is dependent on understanding and respecting the views of its employees, and we aim to be a responsible employer in our approach to the pay and benefits that our employees receive. The health, safety and well-being of our employees are one of our primary considerations in the way we conduct business.

Employee engagement

Our employees are central to our business and we strive to create a culture of diversity and inclusion. We provide a workplace with attractive benefits and opportunities for career progression within the Group.

The Board continues to be regularly updated on employee-related matters, including staff retention rates, numbers, disciplinary, health, safety and wellbeing issues.

Ethical employment

It is the Group’s policy to offer equal opportunities to disabled persons applying to vacancies and provide them with the same opportunities as all other employees, within the limitations of their aptitude and abilities. In the event of any staff member becoming disabled, every effort is made to ensure that their employment with the Group continues.

Employment with the Group is based upon the person’s ability to work and not on the basis of race, individual characteristics, creed or political opinion.

Equality of opportunity

We are an equal opportunity employer and we aim to ensure our employees achieve their full potential and all employment decisions are taken without reference to discriminating criteria throughout the whole employment process.

Business relationships

Engagement with suppliers and customers is key to our success.

Suppliers - Throughout the year the Board was briefed on any contract negotiations with its two brand partners with regards to volume aspirations, targets and facility development issues. The Board seeks to balance the benefits of maintaining strong relationships with other key suppliers alongside the need to obtain value for money for the business.

Customers - As a large retail business, customer satisfaction can be seen in the Group’s underlying sales performance figures, which the Board reviews regularly. The Executive Directors provide updates to the Board on consumer satisfaction and the market performance.

Finance facility providers - The Chief Financial Officer, in conjunction with the Group Treasurer, is responsible for managing the relationships with our banks, Mercedes-Benz Financial Services UK Ltd and BMW Financial Services (GB) Limited for the Group’s financing activities.

Our community and the environment

Community - As a retail business, we have a tangible presence in the many communities our businesses serve. Our retail businesses also engage with local communities, contributing to their local areas in a variety of ways. The Group supports and encourages these activities and we welcome the opportunities they present for team building within our businesses, engagement with the communities they serve and recognition of charitable causes with whom our team members and their families have connections.

Environment - The Board recognises that its activities have an impact on the environment and is therefore keen to promote and support initiatives that minimize the effect of such activities. We continue to monitor the areas of our business that may impact on the environment including contamination, asbestos, waste oil, and waste recycling together with energy, water and fuel efficiency. The Group are introducing further measures to reduce our carbon footprint.

Political donations

No donations were made for political purposes (2024: £nil).

On behalf of the board

The directors present their annual report and financial statements for the year ended 31 December 2025.

The principal activity of the company and group continued to be that of motor car retailers and repairers.

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

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

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

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

The group’s financial instruments comprise cash and liquid resources, loans and various items such as trade debtors and trade creditors that arise directly from operations. The main risks arising from the group’s financial instruments are cash flow risk, liquidity risk and interest rate risk. The group has procedures in place for managing cash and liquidity risks, including the review of cash projections on a quarterly basis by the board. The group continually reviews such risks and takes action as deemed necessary. Interest rate risk is managed by seeking to utilise low fixed interest rates where possible.

The auditor, Cooper Parry Group Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

This section includes our mandatory reporting of energy and greenhouse gas emissions for the period 1 January 2025 to 31 December 2025, pursuant to the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018, implementing the government’s Streamlined Energy and Carbon Reporting (SECR) policy.

Our methodology to calculate our greenhouse gas emissions is based on the 'Environmental Reporting Guidelines: Including streamlined energy and carbon reporting guidance (March 2019)’, using DESNZ's 2024 conversion factors as appropriate. In some cases, consumption has been extrapolated from available data or direct comparison made to a comparable period.

We report using a financial control approach to define our organisational boundary. We have reported all material emission sources required by the regulations for which we deem ourselves to be responsible and have maintained records of all source data and calculations.

The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £million of turnover, the recommended ratio for the sector.

During the reporting period, we have continued to invest in PV with an installation at Ruxley in October. Our ongoing energy management programme continues to run for two of our larger sites. This includes daily monitoring and targeted reporting of energy consumption. Through the service provided by our energy consultants, the programme enables us to identify and address any consumption issues as and when they arrive, allowing us to eliminate unnecessary energy waste.

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the 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 group and company, and of the profit or loss of the group 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 UK 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 group and company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

We have audited the financial statements of Hedin Automotive Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2025 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including 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 group's and the parent company's affairs as at 31 December 2025 and of the group's loss 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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

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

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

• The information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• The strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

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

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

• the parent company financial statements are not in agreement with the accounting records and returns; or

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

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

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.

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

Extent to which the audit was considered capable of detecting irregularities including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, we considered the following:

• the nature of the industry and sector, control environment and business performance.

• any matters we identified having obtained and reviewed the company's documentation of their policies and procedures relating to:

  • identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance,

  • detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;

• the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations; and

• the matters discussed among the audit engagement team and involving relevant internal specialists, including tax, and industry specialists regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas: valuation of used vehicle stocks and recognition of supplier incentives. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.

We also obtained an understanding of the legal and regulatory frameworks the group operates in, focussing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act and tax legislation.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the group’s ability to operate or to avoid a material penalty. These included the group’s FCA regulatory requirements.

Our procedures to respond to risks identified included the following:

• reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;

• enquiring of management and those charged with governance concerning actual and potential litigation claims;

• in addressing the risk of fraud through inappropriate valuation of used vehicle inventory, assessing net realisable value of stock items sold after the year end was above cost or assessing their value with reference to third party data sources if unsold.

• in addressing the risk of fraud through inappropriate recording of supplier incentives, ensuring amounts recorded as due were then subsequently acknowledged as such by the supplier;

• in assessing the risk of fraud through management override of controls, testing the appropriateness of journal entries and assessing whether judgements made in making accounting estimates are indicative of potential bias.

There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.

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

Use of our report

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

The Statement of Comprehensive Income has been prepared on the basis that all operations are continuing operations.

As permitted by section 408 of the Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was £1,603,970 (2024 - £2,741,117 loss).

Hedin Automotive Ltd (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Mercedes Benz of Brooklands, Brooklands Drive, Weybridge, KT13 0SL.

The group consists of Hedin Automotive Ltd and all of its subsidiaries.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

• Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

• Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

The consolidated group financial statements consist of the financial statements of the parent company Hedin Automotive Ltd together with all entities controlled by the parent company (its subsidiaries).

All financial statements are made up to 31 December 2025. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

At 31 December 2025 the group had net current liabilities of £16,946,995 and was loss making.

The group forms part of the wider Hedin Mobility Group AB (“Hedin Mobility Group”), and its liquidity and financing are managed on a group‑wide basis. In assessing the appropriateness of preparing the financial statements on a going concern basis, the directors have considered the UK group’s financial position in the context of the wider Hedin Mobility Group.

During 2025, covenant breaches were identified within the UK sub‑group. These breaches have since been formally waived by the relevant lenders. In addition, subsequent to the reporting period, Hedin Mobility Group completed a refinancing which extended the maturity profile of its borrowing arrangements. As a result of this refinancing, financial covenants are now assessed at the level of Hedin Mobility Group rather than at an individual UK entity or UK sub‑group level.

The directors have reviewed forecasts prepared at the level of Hedin Mobility Group covering the going concern assessment period. These forecasts demonstrate that the group is expected to meet its revised covenant requirements and maintain adequate liquidity. The directors have considered reasonably foreseeable downside scenarios and remain satisfied that the group has sufficient financial resources and flexibility to continue to meet its obligations as they fall due.

The UK group is supported by the wider Hedin Mobility Group, and the directors are satisfied that Hedin Mobility Group has both the willingness and the financial capacity to provide ongoing support to the group for the foreseeable future.

Based on the aforementioned assessment, the directors believe that it remains appropriate to prepare the financial statements on a going concern basis.

Turnover represents the value of goods and services, excluding value added tax, invoiced to third parties. Income is recognised when vehicles are delivered or paid for in full, when parts have been supplied and services have been provided. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from commissions receivable is recognised when the amount can be reliably measured and it is probable that the company will receive the consideration.

Agency commission revenue from manufacturers is recognised at the point the customer takes delivery of the new vehicle and the company becomes entitled to the commission payment.

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

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

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

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

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 profit and loss account.

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. 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 period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

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

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Vehicles on consignment are recognised within the balance sheet when the vehicles are in substance an asset of the group. This is determined by reference to whether the principal risks and rewards of ownership have been transferred to the group. The corresponding liability is included under creditors: amounts falling due within one year.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within creditors: amounts falling due within one year.

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset and 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.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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 business 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 group's contractual obligations expire or are discharged or cancelled.

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

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

Termination benefits are recognised immediately as an expense when the 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 to profit or loss on a straight line basis over the term of the relevant.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Consignment vehicles are recognised on the balance sheet when the significant risks and rewards of ownership have passed to the company even though legal title has not yet passed. The corresponding liability is included within creditors: amounts falling due within one year.

The group carries out impairment tests for goodwill where there are indicators that it may be impaired. The performance of these tests requires significant judgement around the future cash generating ability of the relevant business units over long term time horizons. Management use a combination of historical experience of the brands concerned over a full economic cycle as well as the impact of known future changes to the business model in making their assessments.

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

The annual depreciation change for tangible and intangible assets is sensitive to changes in the estimated useful economics lives and residual values of assets. The useful economic lives and residual values are re-assessed annually. They are amended where necessary to reflect current estimates.

Stocks are stated at the lower of cost and net realisable value. The value of all used cars as well as the provision for obsolete, slow moving or defective stock can have a significant influence on the stock valuation in the financial statements. A comprehensive review of the stock held is carried out with reference to independent market valuation data.

All of the group's turnover arose within the UK.

Exceptional restructuring costs of £66,273 (2024: £579,582) were incurred in the year. These costs relate to specific one off salary costs arising from an exceptional headcount reduction exercise and do not reflect the ongoing cost base of the company.

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

Their aggregate remuneration comprised:

The actual charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:

The group is part of an international group headed by Hedin Mobility Group AB which falls within the scope of the OECD Pillar Two global minimum tax rules, which apply to groups with consolidated annual revenues in excess of €750 million. Pillar Two legislation has been enacted in the United Kingdom and in a number of other jurisdictions in which the wider group operates.

The assessment of potential exposure under Pillar Two is being performed at a group level by the ultimate parent company. Based on current information, no current or deferred tax amounts have been recognised in these financial statements in respect of Pillar Two.

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

RRT (UK) Limited, company number 06998870, is entitled to and has taken advantage of the exemption from audit available under s479A of the Companies Act 2006. Hedin Automotive Limited guarantees the liabilities of the company under s479C of the Companies Act 2006 in respect of the year ended 31 December 2025.

Stock is stated net of provisions of £1,373,129 (2024: £1,655,617).

Trade debtors are stated net of provisions of £77,056 (2024: £120,481).

Vehicle stock finance loans within trade creditors totalling £70,668,128 (2024: £70,675,284) are secured by a fixed and floating charge over the vehicle stocks of the group.

The long-term loans are secured by fixed and floating charges over the assets of the group.

Bank loans comprise a senior term loan with a year end balance of £24,150,000 and a revolving overdraft facility of £10,000,000. The rate of interest payable on the senior term loan is at the RFR compounded central bank interest rate + 2.25% margin. The loan is secured against assets of the group and guaranteed by a director.

The loan is repayable by quarterly equal instalments of £1,225,000 and is due to be repaid by March 2028. The revolving overdraft facility is due to be repaid by March 2028.

The manufacturer loan consists of two term loans due to BMW Financial Services (GB) Limited.

One term loan with monthly repayments of £42,373 commenced in 2019 with a final payment of £2,500,000 paid in January 2025.

The second term loan with monthly repayments of £15,668 commenced in July 2022 with a final payment due in June 2032. Interest is payable at a rate of 2.45% above BMW base rate. The loan is secured against the freehold property at Tylney Road, Bromley.

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Deferred income is included in the financial statements as follows:

The deferred lease incentive is released over the property lease term of 25 years to June 2047.

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

All shares have full voting, dividend and capital distribution (including on winding up) rights; they do not confer any rights of redemption.

Share premium

Includes any premiums received on the issue of share capital above its par value.

Profit and loss reserves

The profit and loss reserve includes all current and prior year retained profit and losses.

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

At the reporting end date the group had contracted with tenants for the following minimum lease payments:

Amounts contracted for but not provided in the financial statements:

One ordinary share was issued at a premium of £3,499,999 to the parent company, Hedin Mobility Group, on 2 March 2026.

During the period rent paid and other expenses totalling £1,968,466 (2024: £1,900,277) was charged by Balder Dalston 1 Limited, a company with common shareholdership.

During the period rent paid and other expenses totalling £130,811 (2024 - £Nil) was charged by Big & Red Storage Limited, a company with common directorship. The balance due at the year end was £19,622 (2024: £Nil). During the period rent and other expenses totalling £487,959 (2024: £Nil) was charged to Big & Red Storage Limited.

During the period rent paid and other expenses totalling £123,917 (2024: £Nil) was charged by DCMS Holdings Ltd, a company with common directorship.

The company is exempt from disclosing related party transactions with companies that are wholly owned within the group.

The ultimate parent company is Hedin Mobility Group AB. The ultimate controlling party is considered to be A Hedin by virtue of his majority voting rights in the ultimate parent company.