The director presents the strategic report for the year ended 30 September 2025.
The Group has experienced an exceptional year of growth, increasing turnover by an impressive 37% to £16.0m (2024: £11.7m). This rapid expansion demonstrates the strength of our service offering and our growing footprint within the education catering sector.
The financial year under review has been characterised by significant and deliberate investment in our operational and management infrastructure to support this rapid scale. While we have continued to deliver robust top-line revenue growth, the Directors made a conscious, strategic decision to prioritise building a sustainable, scalable platform over short-term margin maximisation during this trading period.
Consequently, while our Gross Profit increased to £2.8m (2024: £1.7m), reflecting the health of our core trading, our Operating Profit was £111k (2024: £210k). This decrease is a direct result of planned increases in administrative expenses, which rose to £2.7m (2024: £1.5m).
This increase represents heavy, targeted investment in our central and regional management structures.
As the Group scales towards the £20m turnover mark and beyond, the complexity of our multi-site operations increases exponentially. To ensure that our rapid growth does not compromise our food quality, compliance standards, or long-term operational margins, the Board initiated a comprehensive enhancement of our management hierarchy.
During the year, we have heavily invested in the following structural improvements:
Enhanced Commercial and Financial Partnering: We recognise the need to bridge the gap between central strategy and site-level execution. By investing in robust commercial and operational management, we are ensuring that our site leaders are supported by data-driven insights to manage food costs, labour, and supply chain efficiencies locally.
Operational Leadership: We have realigned and strengthened our regional management tiers, moving away from reactive management toward a more agile, proactive support model. This structure provides our catering staff with greater guidance while ensuring rigorous compliance and quality control.
While these investments have naturally increased our central overheads and impacted our Operating Profit in the current financial year, the Board views this not as a cost, but as a critical capital investment in the Group’s operating engine.
The management restructuring and infrastructure investments executed this year have established a highly scalable, resilient platform. We anticipate that these foundational investments will yield substantial commercial returns in the upcoming financial year and beyond, specifically driving:
Accelerated Revenue Growth: By relieving our senior operational teams of decentralised administrative burdens and strengthening our support structures, we have significantly increased our management bandwidth. This allows the business to aggressively pursue new contract tenders and execute seamless, high-quality mobilisations of new sites without straining existing resources.
Margin Protection and Expansion: The newly embedded management structures are targeted with driving tangible cost efficiencies across our enlarged portfolio. For the upcoming year, our focus is on food waste reduction, optimised labour scheduling, and tighter procurement controls. As revenue continues to scale, our newly streamlined and empowered management structure will allow us to achieve greater economies of scale, driving a higher percentage of gross profit down to the bottom line.
Enhanced Client Value: A more robust, well-supported management team allows us to provide greater transparency and innovation to our clients, securing long-term contract extensions and positioning the Group as a premium, forward-thinking partner in the market.
The directors continually monitor the risks facing the group and recognise and manage those risks appropriately.
Health and Safety Food Hygiene and Health and Safety remain paramount. We train our teams on how to manage and mitigate risks within our kitchen environments. There is a constant emphasis on training, compliance, and reporting to ensure we minimise risks to our team members and the students we serve.
Financial and Economic Environment The current economic environment, including inflationary pressures on food and labour costs, continues to present challenges to the sector. However, the management restructuring completed this year was designed specifically to mitigate these risks. By empowering our site managers with better commercial support and optimising our labour deployment through enhanced regional oversight, the Group is now far better insulated against macroeconomic fluctuations. We actively manage our cash liquidity and have secured the necessary invoice financing to support our working capital requirements during this period of high growth.
The Board is highly optimistic about the future. The current financial year was deliberately utilised to "build the engine" required for the next tier of our corporate expansion. With a strengthened, agile, and commercially astute management structure now firmly in place, the Group is exceptionally well-positioned to deliver continued revenue growth alongside expanded profitability in the forthcoming financial year.
On behalf of the board
The director presents his annual report and financial statements for the year ended 30 September 2025.
The results for the year are set out on page 8.
No ordinary dividends were paid. The director does not recommend payment of a further dividend.
The director who held office during the year and up to the date of signature of the financial statements was as follows:
The group's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.
Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the group's performance.
There is no employee share scheme at present, but the director is considering the introduction of such a scheme as a means of further encouraging the involvement of employees in the company's performance.
United Kingdom company law requires the director to prepare financial statements for each financial year. Under that law, the director has elected to prepare the group and parent company financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law, the director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the group and parent company, and of the profit or loss of the group for that period.
In preparing these financial statements, the director is required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and parent company will continue in business.
The director is responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and parent company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and parent company, and enable them to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the group and parent company, and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
We have audited the financial statements of HC 1265 Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 September 2025 which comprise the group profit and loss account, 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, the company 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).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the director's 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 director with respect to going concern are described in the relevant sections of this report.
Other information
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 director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
The strategic report and the director's report have been prepared in accordance with applicable legal requirements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We gained an understanding of the legal and regulatory framework applicable to the company and the sector in which it operates and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, recognising that 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.
We focused on laws and regulations which could give rise to a material misstatement in the financial statements, including, but not limited to the Companies Act 2006, taxation legislation, data protection, anti-bribery, employment, environmental and health and safety legislation.
Our tests included agreeing the financial statement disclosures to underlying supporting documentation, analytical review, the relevance and accuracy of accounting estimates, enquiries with management and reviewing meeting minutes of those charged with governance. 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. We did not identify any key audit matters relating to irregularities, including fraud. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represent a risk of material misstatements due to fraud.
It should be noted that Auditing standards limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
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.
Other matters which we are required to address
We were appointed to audit the financial statements for the year ending 30 September 2025. This is the first year that was subject to an audit. The prior year’s figures are unaudited, whilst this would give rise to a qualification of the profit and loss account, substantive audit work was undertaken on the balance sheet to provide assurance on the opening balances and consequently to provide assurance on the 2025 profit and loss account.
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.
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 £10,422 (2024 (Unaudited) - £0 profit).
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
HC 1265 Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 51 High Street, Sandbach, Cheshire, CW11 1AL.
The group consists of HC 1265 Limited 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 consolidated group financial statements consist of the financial statements of the parent company HC 1265 Limited together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 30 September 2025.
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.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
At the time of approving the financial statements, the director has a reasonable expectation that the group and parent company have adequate resources to continue in operational existence for the foreseeable future. Thus the director continues to adopt the going concern basis of accounting in preparing the financial statements.
Turnover represents amounts receivable for goods and services net of VAT.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
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 entities 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 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).
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset.
Recoverable amount is the higher of fair value less costs to sell and value in use.
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately in profit or loss.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the 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 and loans from fellow group 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.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the 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.
In the application of the group’s accounting policies, the director is 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 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 charge for the year based on the profit or loss and the standard rate of tax as follows:
Details of the company's subsidiaries at 30 September 2025 are as follows:
During the year, there were early final settlements for two of the loans in March 2025, which original had end term dates in 2026 and 2029. HSBC Bank plc also held a debenture over the subsidiary's assets which was satisfied on 4th December 2024.
At the year end, there was a HSBC bounce-back loan, with an interest rate of 2.5% which is due to complete in July 2026 and RBS Invoice Finance Ltd holds a debenture over all of the subsidiary's assets, for the use of an Invoice Finance Facility with an interest rate of 2.25% above base.
The following are the major deferred tax liabilities and assets recognised by the group and company:
The deferred tax asset set out above is expected to reverse within the foreseeable future and relates to the utilisation of retirement benefit obligations against accelerated capital allowances that will mature during the same period.
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.