Company Registration Number: 10285348
FOR THE YEAR ENDED 31 MARCH 2026
GRAIN CONNECT LIMITED
COMPANY INFORMATION
GRAIN CONNECT LIMITED
CONTENTS
GRAIN CONNECT LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2026
Grain deploys and operates fibre-to-the-premises (“FTTP”) networks in targeted urban communities and new build housing developments across Great Britain.
Grain is also an Internet Service Provider (“ISP”), retailing its high speed FTTP connectivity directly to consumers and small to medium sized businesses.
Grain’s strategy is to build, connect and operate the lowest cost network in the industry, so that it maintains a strategic long-term cost advantage over the rest of the industry.
The Directors present their strategic report together with the audited financial statements for the year ended 31 March 2026.
Grain is also an Internet Service Provider (“ISP”), retailing its high speed FTTP connectivity directly to consumers and small to medium sized businesses.
Grain’s strategy is to build, connect and operate the lowest cost network in the industry, so that it maintains a strategic long-term cost advantage over the rest of the industry.
The Directors present their strategic report together with the audited financial statements for the year ended 31 March 2026.
The key performance indicators are:
In the 12 months to 31 March 2026, Grain grew its revenue by 48% to £13.3m (2025: £9.0m), driven by an increase in customer base in live regions, and a growth in the size of the group’s network.
The group generated an operating loss of £9.55m (2025: £11.53m) with the improvement a result of the business achieving a full year of EBITDA positivity, combined with growth in the size of Grain’s network and its customer base.
The group generated an operating loss of £9.55m (2025: £11.53m) with the improvement a result of the business achieving a full year of EBITDA positivity, combined with growth in the size of Grain’s network and its customer base.
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GRAIN CONNECT LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
With FY25’s strategy to “Build Superiority” achieved successfully, Grain’s strategic priority for FY26 has been to use this platform to “Build Scale”. Grain had three strategic targets in the year:
i. to secure sufficient funding to materially scale the size of its network footprint,
ii. continue to grow the existing customer base,
iii. achieve a full year of annualised profitability (following Grain turning EBITDA profitable at the end of FY25).
Building Scale – Funding
In July 2025, Grain secured a £212.5 million debt facility from funds managed by HPS Investment Partners, a subsidiary of BlackRock, alongside a further £13 million equity investment from existing shareholder Equitix. This marked Equitix’ fifth follow-on investment, underscoring sustained institutional conviction in Grain’s capital-efficient, scalable model.
At a time when most altnets have halted expansion and pivoted toward consolidation to contain losses, Grain secured one of the largest organic growth financings in the sector since the early 2020s. The transaction will accelerate network expansion from 250,000 at the time of the deal being secured, to approximately 600,000 premises, advancing Grain’s longer-term strategy to exceed one million premises passed through one of the largest organic builds in the UK fibre market.
This funding was achieved because Grain:
i. to secure sufficient funding to materially scale the size of its network footprint,
ii. continue to grow the existing customer base,
iii. achieve a full year of annualised profitability (following Grain turning EBITDA profitable at the end of FY25).
Building Scale – Funding
In July 2025, Grain secured a £212.5 million debt facility from funds managed by HPS Investment Partners, a subsidiary of BlackRock, alongside a further £13 million equity investment from existing shareholder Equitix. This marked Equitix’ fifth follow-on investment, underscoring sustained institutional conviction in Grain’s capital-efficient, scalable model.
At a time when most altnets have halted expansion and pivoted toward consolidation to contain losses, Grain secured one of the largest organic growth financings in the sector since the early 2020s. The transaction will accelerate network expansion from 250,000 at the time of the deal being secured, to approximately 600,000 premises, advancing Grain’s longer-term strategy to exceed one million premises passed through one of the largest organic builds in the UK fibre market.
This funding was achieved because Grain:
∙Has built the sector’s most efficient deployment model (externally benchmarked showing the next most efficient PIA operator has a capital deployment cost 47% higher than Grain);
∙Delivers the lowest operating cost per customer (60%+ lower than other providers based on publicly available financial data); and
∙Reached EBITDA positive at the end of 2025 on c. 42,000 customers (and has delivered full year EBITDA profitability in 2026).
In a capital-constrained market, Grain's investors have backed demonstrable performance, disciplined execution, and a proven path to scalable profitability.
No other alt-net in the past year has secured more growth capital than it had raised in its entire history funding this scale for organic expansion. The transaction signals renewed institutional confidence in sustainable fibre economics and establishes Grain as the benchmark for efficient, profitable network deployment in a consolidating market.
No other alt-net in the past year has secured more growth capital than it had raised in its entire history funding this scale for organic expansion. The transaction signals renewed institutional confidence in sustainable fibre economics and establishes Grain as the benchmark for efficient, profitable network deployment in a consolidating market.
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GRAIN CONNECT LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
Building Scale – Network Build
Grain is focussed on the continued expansion of its FTTP network, targeting new build developments and urban areas covering more than 75 urban towns and cities across Great Britain.
During the year Grain has continued to expand its coverage, investing into its footprint across both urban developments and new build housing with over 300,000 homes ready for service. Unlike Openreach and other Alternative telecommunications networks (“Alt-nets”) which describe a home ready for service as one which has a live network at the top of a pole or in a chamber, somewhere near a premise, (sometimes over 100 metres away) and still needing substantial capital investment to connect a customer, a home ready for service for Grain is one that has a live network at the boundary of each premise.
Cost per premise passed on the network was slightly lower than the previous year. As the majority of the build covers the Urban network, this primarily covers the end-to-end build of the urban network, including all expenditure required to deliver a live fibre connection to the boundary of every premise connecting the site to Grain’s datacentres. By building its own access network Grain avoids the cost of renting Openreach’s infrastructure via Physical Infrastructure Access (“PIA”) and the associated embedded lease of an estimated c.£190.
Building Scale – Customers
Grain offers customers value for money with super-fast, reliable, and affordable broadband packages to local communities. Fairness and transparency has been at the core of Grain’s customer acquisition strategy. Grain grew its customer base in the financial year to c. 56,000 customers by the end of the year.
Additionally, Grain has upgraded its network during the course of the year to be able to offer services to end consumers of up to 10Gbps to provide peak performance and reliability to high usage customers.
Despite operating in a competitive market, and having added c.50,000 new homes RFS which start with zero penetration, Grain grew its penetration in the year from 16% to 19%. The Directors believe that Grain’s low-cost proposition remains a clear point of differentiation and a key strength of the business.
Grain’s ability to offer high-quality connectivity at low price points continues to support its market position and provides confidence in the Group’s ability to grow its customer base over the medium term. The Directors therefore remain confident that the business is well placed to compete effectively, while continuing to focus on disciplined growth, customer acquisition and long-term value creation.
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GRAIN CONNECT LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
Building Scale – Profitability
The largest elements of cost of sales are the rental of backhaul circuits, cabinet electricity, peering and IP Transit connecting our customers to the internet, which are provisioned upfront to support future customer expansion. During the financial year, Grain had a Gross Margin of 77.2% (FY25: 67.4%) which expanded as we added customers to our network. With the significant growth in customers across the year, this resulted in the ratio growing with Gross Margin % growing to 79.2% by the end of the financial year, compared to a Gross Margin of 74.6% achieved at March 2025.
Grain’s strategy to be a low-cost operator has already demonstrated success with the business turning EBITDA positive at the end of 2025 at a scale significantly below the level other comparable businesses have achieved it. During 2026, despite significant investment in the business to scale the operation for delivery of the expanded footprint expansion, EBITDA margins still grew to over 16% by the end of the year through a combination of customer growth, proactive customer upgrades and operational cost control.
Grain’s Cashflow from Existing Footprint in the year was -£2.8m (FY25: -£5.5m), a reduction of 50% on prior year. Grain’s strategy is to leverage its low cost foundation to achieve the next stage of its journey, positive Cashflow from Existing Footprint, in the financial year ended March 2027.
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GRAIN CONNECT LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
The principal risks and uncertainties of the business are as follows:
Macroeconomic Stability
The advent of the conflict in the Middle East in 2026 has created some uncertainty for all businesses in the UK that rely on goods from overseas, in addition to the impact on fuel costs that the war has created. Grain has mitigated this to the extent possible by optimising travel costs, and regularly tendering with suppliers for the best value input costs.
Interest rates
The rise in interest rates during 2024 and 2025 has impacted the cost of borrowing in 2026, which impacts an element of debt funding costs to Grain. Grain has mitigated this using cap and floor agreements with its debt funders to limit this liability.
Foreign Exchange
The principal foreign exchange risk for the business is the US Dollar. Foreign exchange risk arises from commercial transactions. Grain seeks to minimise its exposure to foreign exchange risk and all cash balances in foreign currency that are not required for short term working capital monetary needs are converted into pounds.
Access to funding
Grain intends to continue investing significant capital expenditure to achieve its network roll-out goals. Access to further equity funding was obtained in July 2025 and Grain intends to seek further funding in the next 18 months to enable the business to expand to over 1m premises.
Macroeconomic Stability
The advent of the conflict in the Middle East in 2026 has created some uncertainty for all businesses in the UK that rely on goods from overseas, in addition to the impact on fuel costs that the war has created. Grain has mitigated this to the extent possible by optimising travel costs, and regularly tendering with suppliers for the best value input costs.
Interest rates
The rise in interest rates during 2024 and 2025 has impacted the cost of borrowing in 2026, which impacts an element of debt funding costs to Grain. Grain has mitigated this using cap and floor agreements with its debt funders to limit this liability.
Foreign Exchange
The principal foreign exchange risk for the business is the US Dollar. Foreign exchange risk arises from commercial transactions. Grain seeks to minimise its exposure to foreign exchange risk and all cash balances in foreign currency that are not required for short term working capital monetary needs are converted into pounds.
Access to funding
Grain intends to continue investing significant capital expenditure to achieve its network roll-out goals. Access to further equity funding was obtained in July 2025 and Grain intends to seek further funding in the next 18 months to enable the business to expand to over 1m premises.
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GRAIN CONNECT LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
Competition
Competition arises from BT, Virgin, Sky, TalkTalk and new entrants to the market. Grain has taken steps to ensure that it maintains both a low cost, efficient build, and an efficient operating model, in order to pass the benefits back to customers in the form low prices, allowing it to be more competitive than other fibre providers.
Future Developments
Grain continues to build and grow the size of its fibre-optic network. In the coming years it intends to secure additional funding to deliver on its build plans and grow its customer base.
Post balance sheet events
No post balance sheet events to report.
Competition arises from BT, Virgin, Sky, TalkTalk and new entrants to the market. Grain has taken steps to ensure that it maintains both a low cost, efficient build, and an efficient operating model, in order to pass the benefits back to customers in the form low prices, allowing it to be more competitive than other fibre providers.
Future Developments
Grain continues to build and grow the size of its fibre-optic network. In the coming years it intends to secure additional funding to deliver on its build plans and grow its customer base.
Post balance sheet events
No post balance sheet events to report.
This report was approved by the board and signed on its behalf.
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GRAIN CONNECT LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2026
The directors present their report and the financial statements for the year ended 31 March 2026.
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments 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 Group 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 the Group and to 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The loss for the year, after taxation, amounted to £24,764 thousand (2025 - loss £17,395 thousand).
The directors who served during the year were:
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GRAIN CONNECT LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
The auditors, Armstrong Watson Audit Limited, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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GRAIN CONNECT LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GRAIN CONNECT LIMITED
We have audited the financial statements of Grain Connect Limited (the 'Parent Company') and its subsidiaries (the 'Group') for the year ended 31 March 2026, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Analysis of Net Debt, the Consolidated Statement of Financial Position, the Company Statement of Financial Position, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, 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 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 or the 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.
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GRAIN CONNECT LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GRAIN CONNECT LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group 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 Group 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 its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Directors' Report.
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GRAIN CONNECT LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GRAIN CONNECT LIMITED (CONTINUED)
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 Auditors' 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 Group financial statements.
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:
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
• the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
• we identified the laws and regulations applicable to the company through discussions with directors and other management;
• we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management; and
• identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the Company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
• making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
• considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
To address the risk of fraud through management bias and override of controls, we:
• performed analytical procedures as a risk assessment tool to identify any unusual or unexpected relationships; and
• tested journal entries to identify unusual transactions.
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GRAIN CONNECT LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GRAIN CONNECT LIMITED (CONTINUED)
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures
which included, but were not limited to:
• agreeing financial statement disclosures to underlying supporting documentation; and
• enquiring of management as to actual and potential litigation and claims.
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 Auditors' Report.
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants & Statutory Auditors
Carlisle
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GRAIN CONNECT LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2026
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GRAIN CONNECT LIMITED
REGISTERED NUMBER: 10285348
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2026
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 23 to 44 form part of these financial statements.
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GRAIN CONNECT LIMITED
REGISTERED NUMBER: 10285348
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2026
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 23 to 44 form part of these financial statements.
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GRAIN CONNECT LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2026
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GRAIN CONNECT LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2025
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GRAIN CONNECT LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2026
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GRAIN CONNECT LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2025
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GRAIN CONNECT LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2026
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GRAIN CONNECT LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
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GRAIN CONNECT LIMITED
CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 MARCH 2026
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Grain Connect Limited is a private company, limited by shares, incorporated in England & Wales, registered number 10285348. The registered office is Clifford House Cooper Way, Parkhouse, Carlisle, United Kingdom, CA3 OLJ.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between Grain Connect Limited and its own subsidiary companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of Financial Position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
These consolidated financial statements do not include the immediate parent Grain Connect Midco Limited or the ultimate parent Grain Connect Topco Limited and therefore balances and transactions with these companies remain.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of Financial Position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
These consolidated financial statements do not include the immediate parent Grain Connect Midco Limited or the ultimate parent Grain Connect Topco Limited and therefore balances and transactions with these companies remain.
The company remains in the growth stage of its business plan, during which its objective is to continue to expand its network infrastructure. The losses incurred by the company are in line with the business plan and reflect the investment-stage of the business’s build project. The majority of the cash outgoings of the company relate to this expansion of infrastructure, and the rate of this spend is under the control of the directors. As such, the directors have assessed that the position of the company is such that it could comfortably meet expenditure for a period of at least 12 months from the date of signing these accounts, and have accordingly prepared these accounts on a going concern basis.
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
The fair value of the award also takes into account non-vesting conditions. These are either factors beyond the control of either party (such as a target based on an index) or factors which are within the control of one or other of the parties (such as the Group keeping the scheme open or the employee maintaining any contributions required by the scheme).
Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to profit or loss over the remaining vesting period.
Where equity instruments are granted to persons other than employees, profit or loss is charged with fair value of goods and services received.
Intangible assets are the cost of a website. The asset is being amortised to the profit and loss account over its estimated useful economic life of 3 years.
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
Goodwill
Other intangible assets
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
The estimated useful lives range as follows:
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired under hire purchase contracts are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. Obligations under such agreements are included in the creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to the profit and loss account so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.
Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged to profit and loss account as incurred.
Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged to profit and loss account as incurred.
Stocks and work in progress are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow moving stocks.
Provisions are made where an event has taken place that gives the Group a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Group becomes aware of the obligation, and are measured at the best estimate at the reporting date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Statement of Financial Position.
Provisions are charged as an expense to profit or loss in the year that the Group becomes aware of the obligation, and are measured at the best estimate at the reporting date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Statement of Financial Position.
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
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 Statement of Financial Position when the Group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.
Basic financial liabilities
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 the deduction of all its liabilities.
Basic financial liabilities, which include trade and other creditors, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Other financial instruments
Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.
Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
with a documented risk management or investment strategy.
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Group transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Group will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the Group's contractual obligations expire or are discharged or cancelled.
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Recognition of deferred tax asset
Deferred tax assets should only be recognised where it is probable that future taxable profits will be made against which the potential asset can be utilised.
The directors have considered the performance of the company against business plans. Performance is tracking favourably against those plans, which forecast profitability in the medium term. The directors have determined that there is a probability that the assets will be utilised in future on the grounds that the forecast profitability is more likely than not to arise.
This is a significant judgement taken in the preparation of these accounts, given the magnitude of the deferred tax asset recognised. There is inherently uncertainty as to whether the forecast profitability will be realised.
Depreciation
Tangible fixed assets are depreciated over their estimated useful economic life, to a residual value at the end of that useful economic life.
Determining both the useful economic life and residual values for assets involve forecasting future events, and as such there is inherently uncertainty in these estimates. Because of the materiality of tangible fixed assets to these accounts, and the early-stage nature of the company meaning that there is limited track record against which to benchmark these estimates, the directors have identified depreciation as a key source of estimation uncertainty in these accounts.
Work has been undertaken to determine accurate estimates for both the useful economic lives and residual values, particularly by benchmarking those values against industry averages.
Investment in subsidiary valuations
Investments in subsidiaries are held at cost less impairment.
Both of the subsidiary companies in which these investments are held have net assets below the value of the investment, and have made before tax losses in the period. However, the directors believe that the value in the acquisition of these companies remains. The primary rationale for the initial acquisition was the acquiring of regulatory licenses. These licenses hold significant value for the group as a whole, as they allow the group to carry on its business and are critical to its growth plan. As such, the directors have assessed that the value of these licenses support the investment valuations to the extent that no impairment is necessary.
This is a significant judgement because of the magnitude of investment in subsidiaries balance.
The whole of the turnover is attributable to the principal activity, being the provision of broadband internet services.
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Page 31
GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
There were no factors that may affect future tax charges.
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
11.Intangible assets (continued)
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
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Page 35
GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
12.Tangible fixed assets (continued)
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Page 36
GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
12.Tangible fixed assets (continued)
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GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
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Page 38
GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Page 39
GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Page 40
GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
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Page 41
GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Share premium account
Capital contribution reserve
Profit and loss account
Page 42
GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £663,490 (2025 - £602,989). Contributions totalling £73,852 (2025 - £56,097 ) were payable to the fund at the reporting date and are included in creditors.
Page 43
GRAIN CONNECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
The parent company of the entity is Grain Connect Midco Limited . The parent of the largest group including these accounts in its consolidation is Grain Connect Topco Limited . There is no individual controlling party.
Throughout the period and the prior period,the company had no ultimate individual controlling party .
Throughout the period and the prior period,
Page 44