Company Registration Number: 13609252
FOR THE PERIOD ENDED 31 MARCH 2026
COMPANY INFORMATION
CONTENTS
GROUP STRATEGIC REPORT
FOR THE PERIOD 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 turning EBITDA positive in the year.
The group generated an operating loss of £9.55m (2025: £11.53m) with the improvement a result of the business turning EBITDA positive in the year.
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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD 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,
iii. continue to grow the existing customer base,
iiii. 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,
iii. continue to grow the existing customer base,
iiii. 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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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD 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.
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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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD 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.
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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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2026
The principle 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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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD 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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DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 MARCH 2026
The directors present their report and the financial statements for the period 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 period, after taxation, amounted to £24,764 thousand (2025 - loss £17,355 thousand).
The directors who served during the period were:
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DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD 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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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GRAIN CONNECT TOPCO LIMITED
We have audited the financial statements of Grain Connect Topco Limited (the 'parent Company') and its subsidiaries (the 'Group') for the period ended 31 March 2026, which comprise the Consolidated statement of comprehensive income, the Consolidated balance sheet, the Company balance sheet, 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).
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 Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
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.
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.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GRAIN CONNECT TOPCO LIMITED (CONTINUED)
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 period 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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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GRAIN CONNECT TOPCO 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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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GRAIN CONNECT TOPCO 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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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 MARCH 2026
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CONSOLIDATED BALANCE SHEET
AS AT 31 MARCH 2026
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CONSOLIDATED BALANCE SHEET (CONTINUED)
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 24 to 41 form part of these financial statements.
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COMPANY BALANCE SHEET
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 24 to 41 form part of these financial statements.
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