REGISTERED NUMBER: 02024802 (England and Wales)

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025

FOR

MAX MARA LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Directors

5

Report of the Independent Auditors

8

Income Statement

12

Other Comprehensive Income

13

Balance Sheet

14

Statement of Changes in Equity

15

Notes to the Financial Statements

16

DIRECTORS:

V Prezioso

M Rossi

A M Sarugia

E Sidoli

A Simonazzi

M Usuardi

A Ceglia

REGISTERED OFFICE:

Second Floor

33 Wigmore Street

London

W1U 1QX

REGISTERED NUMBER:

02024802 (England and Wales)

SENIOR STATUTORY AUDITOR:

Tony Castagnetti

AUDITORS:

Belluzzo Audit Limited

Chartered Accountants and Statutory Auditors

38 Craven Street

London

WC2N 5NG

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

REVIEW OF BUSINESS AND KEY PERFORMANCE INDICATORS

Following a challenging 2024 characterised by geopolitical tensions, inflation and pressure on global markets, trading conditions in 2025 remained difficult for the company. Inflationary pressures, elevated operating costs and subdued consumer demand continued to impact economic activity and consumer confidence, particularly within the retail sector.

These conditions, while not unprecedented, continued to place pressure on international trade and discretionary spending. In response, the directors maintained a focus on cost control, operational efficiency and working capital management throughout the year.

Global economic growth remained modest during the period, with ongoing geopolitical uncertainty continuing to influence market sentiment. The directors continue to monitor the evolving economic environment closely and assess its potential impact on the company’s operations and financial position.

Considering the ongoing evolution of the international context, the economic and asset effects of these conditions remain subject to constant review by management.

Business review

The year 2025 was marked by a contraction in turnover compared with the prior year, reflecting challenging market conditions. Turnover decreased to £67.5 million (2024: £71.7 million).

Despite the reduction in revenue, operating performance remained profitable, although at a reduced level. Operating profit decreased to £1.4 million (2024: £1.9 million), reflecting margin pressure and increased costs, particularly in distribution and administrative expenses.

Profit before taxation fell to £1.6 million (2024: £2.4 million), and profit for the financial year decreased to £1.1 million (2024: £1.7 million).

Despite the decline in profitability, the company strengthened its financial position, maintaining a positive net asset position of £21.6 million at 31 December 2025 (2024: £20.5 million).

Key performance indicators

Turnover decreased from £71.7 million in 2024 to £67.5 million in 2025.

Operating profit reduced from £1.9 million in 2024 to £1.4 million in 2025, reflecting increased cost pressures.

Gross profit increased to £36.0 million (2024: £34.1 million), indicating improved margins at the cost of sales level, although this was offset by higher operating expenses.

The most significant expenditure incurred by the company remained distribution and administrative costs, which increased year-on-year. These costs are partly fixed in nature, but management continues to review and control expenditure where possible.

Financial position

The directors continue to manage the company’s working capital and cash requirements throughout the year. Cash balances decreased during the year, reflecting working capital movements notwithstanding the profitable trading performance. Nevertheless, the company maintained adequate liquidity and continued support from group undertakings.

Stock balances decreased year on year, reflecting tighter inventory management and lower trading volumes.

Despite the challenging trading conditions, the company continues to maintain a strong net asset position.

PRINCIPAL RISKS AND UNCERTAINTIES

It is necessary to consider with caution the evolving international economic environment and the uncertainty that continues to affect global markets. These conditions may have repercussions on the macroeconomic context and, consequently, on inflation trends, consumer confidence and general economic conditions.

The company’s activities expose it to a number of risks and uncertainties which are monitored continuously by management. The principal risks include fluctuations in market demand, increases in operating costs, particularly those relating to property and staffing, and risks associated with liquidity and working capital management.

Liquidity risk

Arises from the need to ensure that the company has sufficient cash resources to meet its obligations as they fall due. This risk is managed through regular cash flow forecasting, monitoring of working capital and continued support from group undertakings.

Credit risk

Arises principally from trade receivables. This risk is managed through appropriate credit control procedures, ongoing monitoring of customer balances and, where appropriate, the use of credit limits.

Considering the continuous evolution of the international context, the potential economic and financial effects of these phenomena are not entirely determinable as of today and will be subject to constant monitoring by management.

Despite the aforementioned elements of uncertainty, the directors remain confident in the company’s ability to continue trading and to respond appropriately to changes in the economic environment.

SECTION 172(1) STATEMENT

Section 172 (1)(a) to (f) requires the directors to act in the way they consider would be most likely to promote the success of the company for the benefit of its members, as a whole, with regard to the following matters:

a) The likely consequences of any decision in the long-term

The company directors have regular meetings on a seasonal basis. This enables the directors to fully understand the performance and the position of the company when making decisions of strategic importance. Directors meet on an ad hoc basis to consider transactions of strategic importance that arise outside the seasonal meetings cycle.

When directors are approving decisions of strategic importance, the Board considers Section 172 requirements, the strategic requirements of the group and the potential outcome of the decisions in the long term.

b)The interests of the company’s employees

The directors consider the company’s employees as the greatest asset and their interests are always taken into consideration when making decisions. An open environment is encouraged and the company aims to be a responsible employer in its approach to employees and employment matters including salary and benefits, diversity and inclusion, training and professional development.

c)The need to foster the company’s business relationships with suppliers, customers and others

The directors and the management team work closely with clients and suppliers to build long-term relationships. The company aims to work with its suppliers in an environment that reflects the values and behaviours the company would expect from its own employees.

d) The impact of the company’s operations on the community and environment

Max Mara brands have been progressively strengthening their commitment to a long term and sustainable growth as a mean to further meet stakeholders’ expectations by creating shared value.

e) The desirability of the company maintaining a reputation for high standards of business conduct

The directors’ intentions are to behave responsibly and to ensure that management operates in a responsible manner, adhering to the high standards of business conduct and good governance while contributing to the company’s continued success.

f) The need to act fairly as between members of the company

The company has one sole shareholder, Max Mara Fashion Group Srl, and the directors have regular and open dialogue with its representatives.

FUTURE DEVELOPMENTS

The directors continue to monitor the evolving economic environment and its potential impact on the company’s operations. The company’s focus in the short to medium term will remain on maintaining operational efficiency, managing costs and optimising working capital.

Management will continue to review the company’s store portfolio and distribution arrangements in response to market conditions and customer demand, while maintaining the strength and positioning of the brand within the United Kingdom market.

No material changes to the nature of the company’s activities are anticipated in the foreseeable future.

ON BEHALF OF THE BOARD:

A M Sarugia - Director

28 May 2026

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

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of wholesaling and retailing of women's fashion clothing.

DIVIDENDS

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

DIRECTORS

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

V Prezioso

M Rossi

A M Sarugia

E Sidoli

A Simonazzi

M Usuardi

A Ceglia

STREAMLINED ENERGY AND CARBON REPORTING

The company’s greenhouse gas emissions and energy consumption are as follows:

2025

2024

Emissions resulting from activities for which the company is responsible involving business travel in rental cars or employee-owned vehicles where company is responsible for purchasing the fuel (Scope 3) (in tonnes of CO2 equivalent)

2.3

1.1

Emissions resulting from the purchase of the electricity by the company for its own use (Scope 2) (in tonnes of CO2 equivalent)

173.7

187.2

Energy consumed from activities for which the company is responsible involving the combustion of gas, or the consumption of fuel for the purposes of transport, and the annual quantity of energy consumed resulting from the purchase of electricity by the company for its own use, including for the purposes of transport (in kWh)

991,639

908,812

Methodology

The boundaries of this report are based on operational control. The company reports its emissions with reference to the latest Greenhouse Gas Protocol Corporate Accounting and Reporting Standard (GHG Protocol). In accordance with the Streamlined Energy and Carbon Reporting (SECR) regulations, the energy use and associated greenhouse gas emissions relate to those activities within the United Kingdom that are under the company’s operational control.

The 2025 UK Government greenhouse gas conversion factors for company reporting, published by the Department for Energy Security and Net Zero, have been used to convert energy consumption into carbon dioxide equivalent (CO2e) emissions. Carbon emissions associated with purchased electricity are calculated using the location-based grid average method, which reflects the average emissions intensity of the UK electricity grid.

Data has been obtained from a combination of supplier invoices, billing information and internal records. Where complete data was not available, reasonable estimates have been applied.

Primary energy efficiency measures implemented

Max Mara Limited did not undertake any energy efficiency actions during the reporting period.

Intensity ratio

We measure our annual emissions in relation to total revenue (our 'intensity ratio'). For the year ended 31 December 2025, emissions were 2.6 tCO2e per £m of revenue (2024: 2.7 tCO2e).

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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

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

-	select suitable accounting policies and then apply them consistently;

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

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

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

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

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

AUDITORS

The auditors, Belluzzo Audit Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium sized companies exemption.

ON BEHALF OF THE BOARD:

A M Sarugia - Director

28 May 2026

Opinion

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

In our opinion the financial statements:

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

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

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

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

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

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

Opinions on other matters prescribed by the Companies Act 2006

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

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

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

Matters on which we are required to report by exception

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

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

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

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

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

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

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page seven, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

Auditors' responsibilities for the audit of the financial statements

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

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

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.

The company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation. We determined that the following laws and regulations were most significant:

-The Companies Act 2006

-Financial Reporting Standard 102

-UK tax legislation

-UK employment legislation

-UK health and safety legislation

-General Data Protection Regulations

We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items. We understood how the company is complying with those legal and regulatory frameworks by making inquiries of management and those responsible for legal and compliance procedures. The engagement partner assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with these laws and regulations. The assessment did not identify any issues in this area.

We assessed the susceptibility of the entity’s financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included:

-identifying and assessing the measures management has in place to prevent and detect fraud;

-understanding how those charged with governance considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process;

-challenging assumptions and judgements made by management in its significant estimates; and

-identifying and testing journal entries, in particular any journal entries posted with unusual account combinations.

As a result of the above procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential existed within the recording and recognition of revenue. Our procedures in this respect were focused on the origination of revenue and directed towards ensuring the accuracy and completeness of the same by undertaking testing on a sample basis of the revenue items to ensure that sales had been recorded correctly and in the appropriate accounting period.

We consider that the work we undertook in this regard was considered capable of detecting irregularities and fraud within the sales cycle. Due to the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulations.

This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. Therefore, if a breach of operational regulations is not disclosed to us or evident from relevant correspondence, an audit will not detect that breach. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission, or misrepresentation.

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

Use of our report

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

Tony Castagnetti (Senior Statutory Auditor)

for and on behalf of Belluzzo Audit Limited

Chartered Accountants and Statutory Auditors

38 Craven Street

London

WC2N 5NG

19 June 2026

TURNOVER

3

67,513,615

71,724,351

Cost of sales

(31,505,731

)

(37,632,503

)

GROSS PROFIT

36,007,884

34,091,848

Distribution costs

(11,711,417

)

(10,919,625

)

Administrative expenses

(22,896,315

)

(21,246,745

)

OPERATING PROFIT

5

1,400,152

1,925,478

Interest receivable and similar income

234,488

515,191

1,634,640

2,440,669

Interest payable and similar expenses

6

(52

)

(29,908

)

PROFIT BEFORE TAXATION

1,634,588

2,410,761

Tax on profit

7

(562,819

)

(689,366

)

PROFIT FOR THE FINANCIAL YEAR

1,071,769

1,721,395

PROFIT FOR THE YEAR

1,071,769

1,721,395

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,071,769

1,721,395

FIXED ASSETS

Tangible assets

8

2,369,108

2,559,241

CURRENT ASSETS

Stocks

9

9,242,047

10,360,760

Debtors

10

17,917,653

15,359,298

Cash at bank

3,213,187

7,305,169

30,372,887

33,025,227

CREDITORS

Amounts falling due within one year

11

(10,613,024

)

(14,347,887

)

NET CURRENT ASSETS

19,759,863

18,677,340

TOTAL ASSETS LESS CURRENT LIABILITIES

22,128,971

21,236,581

CREDITORS

Amounts falling due after more than one year

12

(349,345

)

(486,055

)

PROVISIONS FOR LIABILITIES

14

(181,047

)

(223,716

)

NET ASSETS

21,598,579

20,526,810

CAPITAL AND RESERVES

Called up share capital

15

12,400,000

12,400,000

Retained earnings

16

9,198,579

8,126,810

SHAREHOLDERS' FUNDS

21,598,579

20,526,810

The financial statements were approved by the Board of Directors and authorised for issue on 28 May 2026 and were signed on its behalf by:

A M Sarugia - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2024

12,400,000

6,405,415

18,805,415

Changes in equity

Total comprehensive income

-

1,721,395

1,721,395

Balance at 31 December 2024

12,400,000

8,126,810

20,526,810

Changes in equity

Total comprehensive income

-

1,071,769

1,071,769

Balance at 31 December 2025

12,400,000

9,198,579

21,598,579

1.	STATUTORY INFORMATION

Max Mara Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

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

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

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

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

•

the requirements of Section 7 Statement of Cash Flows;

•

the requirement of paragraph 3.17(d);

•

the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);

•

the requirement of paragraph 33.7.

The information is included within the consolidated financial statements of Max Mara Fashion Group S.r.l. as at 31 December 2025. These financial statements may be obtained from Camera di Commercio, Industria, Artigianato ed Agricoltura di Torino, Italy at www.to.camcom.it

Critical accounting judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the only key estimate made by the directors is:

Stock provisioning

The carrying value of stock, at the lower of cost and net realisable value, is dependent on key judgements and estimates that are made by management. The judgements relating to stock include an estimation of the value of stock remaining at the end of a season, returns from customers, future expected average sales prices and disposal costs. These judgements also include consideration of specific factors and the developments in the market that have been identified throughout the year. Actual outcomes could be different to the assumptions used in determining the estimates.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:

-the company has transferred the significant risks and rewards of ownership to the buyer;

-the company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;

-the amount of revenue can be measured reliably;

-it is probable that the company will receive the consideration due under the transaction; and

-the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:

-the amount of revenue can be measured reliably;

-it is probable that the company will receive the consideration due under the contract.

Tangible fixed assets

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

Tangible fixed assets are stated at cost less accumulated depreciation and any accumulated impairment losses.

Depreciation is provided to allocate the cost of tangible fixed assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Leasehold property and improvements: over the lease term

Fixtures and fittings: 20%

Office equipment: 33%

The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date.

Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). 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.

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

Financial instruments

The company has elected to apply Sections 11 and 12 of FRS 102 in respect of financial instruments.

Financial assets and financial liabilities are recognised when the company becomes party to the contractual provisions of the instrument.

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 company after deducting all of its liabilities.

The company’s policies for its major classes of financial assets and financial liabilities are set out below.

Financial assets

Basic financial assets, including trade and other debtors, cash and bank balances, and intercompany working capital balances, are initially recognised at transaction price, 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 for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.

Such assets are subsequently carried at amortised cost using the effective interest method, less any impairment.

Financial liabilities

Basic financial liabilities, including trade and other creditors, and intercompany working capital balances, 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 for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Impairment of financial assets

Financial assets measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the profit and loss account.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between the asset’s carrying amount and the best estimate of the amount the company would receive for the asset if it were to be sold at the reporting date.

For financial assets measured at amortised cost, the impairment loss is measured as the difference between the asset’s carrying amount and the present value of estimated cash flows discounted at the asset’s original effective interest rate. If the financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.

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.

Derecognition of financial assets and financial liabilities

Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of ownership of the asset are transferred to another party, or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.

Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.

Offsetting of financial assets and financial liabilities

Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is an 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.

Taxation

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

Current or deferred taxation assets and liabilities are not discounted.

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

Deferred tax

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

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

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

Foreign currencies

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

Hire purchase and leasing commitments

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

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

Going concern

Given the strong operational inter-dependency with other group companies the directors continue to have dialogue with group management on all operational and financing matters and as is the culture and ethos of the group, there is full collaboration and support.

The directors have actively reviewed the company’s cashflow and cash requirements throughout the year.

The directors believe that the company’s financial position continues to be stable in the future.

At the date of approval of these financial statements the directors have a reasonable expectation that the company has adequate resources to continue in operational existence and meet its liabilities as they fall due for the foreseeable future, being a period of at least twelve months from the date these financial statements were approved. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.

Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.

Increases in provisions are generally charged as an expense to profit or loss.

3.

TURNOVER

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

An analysis of turnover by class of business is given below:

2025

2024

£

£

Provision of goods

67,109,297

71,038,187

Provision of services

404,318

686,164

67,513,615

71,724,351

4.	EMPLOYEES AND DIRECTORS

2025

2024

£

£

Wages and salaries

6,525,431

5,769,366

Social security costs

792,318

575,627

Other pension costs

143,366

154,411

7,461,115

6,499,404

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

2025

2024

Sales and marketing staff

153

164

Administrative

8

6

Directors

1

7

162

177

2025

2024

£

£

Directors' remuneration

137,717

27,726

Directors' pension contributions to money purchase schemes

18,325

881

5.	OPERATING PROFIT

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

2025

2024

£

£

Other operating leases

17,364,691

13,322,777

Depreciation - owned assets

996,905

832,186

Auditors' remuneration

35,000

44,120

Foreign exchange differences

(8,717

)

(1,150

)

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2025

2024

£

£

Bank interest

52

29,908

7.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2025

2024

£

£

Current tax:

Corporation tax

605,488

595,939

Deferred tax

(42,669

)

93,427

Tax on profit

562,819

689,366

Reconciliation of total tax charge included in profit and loss

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

2025

2024

£

£

Profit before tax

1,634,588

2,410,761

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

408,647

602,690

Effects of:

Expenses not deductible for tax purposes

29,661

55,713

Depreciation in excess of capital allowances

124,511

32,695

Adjustments to tax charge in respect of previous periods

-

(1,732

)

Total tax charge

562,819

689,366

8.	TANGIBLE FIXED ASSETS

Fixtures

Short

and

Computer

leasehold

fittings

equipment

Totals

£

£

£

£

COST

At 1 January 2025

9,236,551

2,659,177

822,063

12,717,791

Additions

573,995

201,067

31,710

806,772

At 31 December 2025

9,810,546

2,860,244

853,773

13,524,563

DEPRECIATION

At 1 January 2025

7,109,078

2,474,565

574,907

10,158,550

Charge for year

730,792

221,683

44,430

996,905

At 31 December 2025

7,839,870

2,696,248

619,337

11,155,455

NET BOOK VALUE

At 31 December 2025

1,970,676

163,996

234,436

2,369,108

At 31 December 2024

2,127,473

184,612

247,156

2,559,241

9.

STOCKS

2025

2024

£

£

Finished goods

9,242,047

10,360,760