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Registered number: 01298017 MECHANICAL & PIPEWORK FABRICATIONS LIMITED ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
MECHANICAL & PIPEWORK FABRICATIONS LIMITED COMPANY INFORMATION
Directors | Scott Ellis
| James Ellis (resigned 22 March 2025)
| Grant Ellis
Company secretary | Angela Ellis
Registered number | 01298017
Registered office | Racecourse Road
| Pinvin Industrial Estate
| Pershore
| Worcestershire
| WR10 2EY
Independent auditors | Lancaster Clements Limited
| Chartered Certified Accountants & Statutory Auditors
| Stanley House
| 27 Wellington Road
| Bilston
| West Midlands
| WV14 6AH
Bankers | Lloyds TSB Bank Plc
| B & C SC
| 3rd Floor 125 Colmore Row
| Birmingham
| West Midlands
| B3 3SD
Solicitors | Thomas Bancks and Co.
| 37 High Street
| Pershore
| Worcestershire
| WR10 1AH
MECHANICAL & PIPEWORK FABRICATIONS LIMITED CONTENTS
| Page
Strategic report | 1
Directors' report | 2 - 3
Independent auditors' report | 4 - 7
Statement of income and retained earnings | 8
Statement of financial position | 9 - 10
Notes to the financial statements | 11 - 25
MECHANICAL & PIPEWORK FABRICATIONS LIMITED STRATEGIC REPORT FOR THE YEAR ENDED 31 DECEMBER 2025
Introduction
The principal activity of Mechanical & Pipework Fabrications Limited, is that of the manufacture and supply of fire protection systems.
Business review
The company has seen a marked increase in turnover this year inline with demand, with there being an 8.3% increase in turnover this year. In comparison the gross profit margin has increased despite the ongoing economic uncertainty. Cash flow has been identified as the principal risk affecting the Company, however, there are sufficient funds currently available within the business. Current trading and open order levels year to date, along with the level of working capital available, gives the directors confidence in the company's long-term future. The overall trading outlook for the calendar year 2026 is positive.
Principal risks and uncertainties
The company has financial risks and seeks to minimise these by incorporating and rigorously implementing controls into key functions as part of the normal business operations. Management review sale prices on a continuous basis to account for fluctuations in costs in order to minimise the risk of gross margin erosion, whilst also managing procurement to take advantage of fluctuating comodity prices at the lowest levels. This policy is supporting the liquid reserves to invest in stock whilst comodity prices are at their lowest. It is therefore recognised that Cash reserves and cash flows are the principal risks facing the business.
Financial key performance indicators
The key performance indicators continue to be turnover, gross profit, operating profit and cash, which have all met the desired performance levels. There has been a marked increase in turnover in the year there has also been an increase in the gross profit margin. On a year to year basis turnover has increased by 8.3%,with the gross profit margin increased from 39.4% to 40.2%.
Other key performance indicators
There are no other key performance indicators. This report was approved by the board on 11 June 2026 and signed on its behalf.
................................................ Scott Ellis Director
Page 1
MECHANICAL & PIPEWORK FABRICATIONS LIMITED DIRECTORS' REPORT FOR THE YEAR ENDED 31 DECEMBER 2025 The directors present their report and the financial statements for the year ended 31 December 2025.
Directors' responsibilities statement
The directors are responsible for preparing the Strategic report, the Directors' report and the financial statements in accordance with applicable law and regulations. Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period. In preparing these financial statements, the directors are required to: ∙select suitable accounting policies for the Company'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 Company will continue in business. The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and 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 hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Results and dividends
The profit for the year, after taxation, amounted to £448,476 (2024 - £319,646). The directors do not propose to recommend payment of a dividend.
Directors
The directors who served during the year were:
Scott Ellis
James Ellis (resigned 22 March 2025)
Grant Ellis
Matters covered in the Strategic report
For a review of business and details of principle risks, uncertainties and future developments please refer to the strategic report. Page 2
MECHANICAL & PIPEWORK FABRICATIONS LIMITED DIRECTORS' REPORT (CONTINUED) FOR THE YEAR ENDED 31 DECEMBER 2025
Disclosure of information to auditors
Each of the persons who are directors at the time when this Directors' report is approved has confirmed that: ∙so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and ∙the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.
Auditors
The auditors, Lancaster Clements Limited, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006. This report was approved by the board on 11 June 2026 and signed on its behalf.
................................................ Scott Ellis Director
Page 3
MECHANICAL & PIPEWORK FABRICATIONS LIMITED INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MECHANICAL & PIPEWORK FABRICATIONS LIMITED
Opinion
We have audited the financial statements of Mechanical & Pipework Fabrications Limited (the 'Company') for the year ended 31 December 2025, which comprise the Statement of income and retained earnings, the Statement of financial position 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 our opinion the financial statements: ∙give a true and fair view of the state of the Company's affairs as at 31 December 2025 and of its profit for the year then ended; ∙have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and ∙have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. Page 4
MECHANICAL & PIPEWORK FABRICATIONS LIMITED INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MECHANICAL & PIPEWORK FABRICATIONS LIMITED (CONTINUED)
Other information
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.
Opinion on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit: ∙the information given in the Strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and ∙the Strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic report or the Directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: ∙adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or ∙the financial statements are not in agreement with the accounting records and returns; or ∙certain disclosures of directors' remuneration specified by law are not made; or ∙we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the Directors' responsibilities statement set out on page 2, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so. Page 5
MECHANICAL & PIPEWORK FABRICATIONS LIMITED INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MECHANICAL & PIPEWORK FABRICATIONS LIMITED (CONTINUED)
Auditors' responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue 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 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: Identifying and assessing potential risks related to irregularities We obtained an understanding of the legal and regulatory frameworks that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act, tax legislation and regulations relating to the employed workforce. In assessing risks of material misstatements in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following: - The clients evaluation of compliance with laws and regulations and whether they were aware of any instances of none compliance, along with the measures in place to mitigate any such instances. - Methods in place to detect and respond to the risk of fraud and whether there was any actual, suspected or alleged fraud, along with internal controls established to mitigate such risks. - Where fraud might occur in the financial statements and any potential indicators of fraud. As a result of those procedures we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential being in relation to: - Stock pilferage or misappropriation - Management override of controls - Transactions outside the normal course of business, particularly with related parties - Misappropriation of cash arising from incomplete recording of cash based transactions. Audit response to risks identified Our procedures to respond to the risks identified included the following: - Testing of material journal entries, paying particular attention to the period immediately prior to and following the reporting date. - Evaluation of the business rationale behind transactions made between related parties that are unusual or outside the normal course of business - An assessment of whether the judgements made in making accounting estimates are indicative of a potential bias - Making enquiries of management concerning actual or potential litigation and claims - Emphasis of control over cash based transactions. We have designed our procedures to best identify the likelihood or occurrence of irregularities, whether or not arising due to fraud. However, it is accepted that there is an inherent difficulty in detecting irregularities and our findings are subject to the timing and extent of the audit procedures performed. 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. Page 6
MECHANICAL & PIPEWORK FABRICATIONS LIMITED INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MECHANICAL & PIPEWORK FABRICATIONS LIMITED (CONTINUED)
Use of our report
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in 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. Mark Anthony Cupitt (Senior statutory auditor) for and on behalf of Lancaster Clements Limited Chartered Certified Accountants Statutory Auditors Stanley House 27 Wellington Road Bilston West Midlands WV14 6AH 11 June 2026 Page 7
MECHANICAL & PIPEWORK FABRICATIONS LIMITED STATEMENT OF INCOME AND RETAINED EARNINGS FOR THE YEAR ENDED 31 DECEMBER 2025
| 2025 | 2024
| £ | £
Turnover | 4 | 11,203,346 | 10,341,964
Cost of sales |  | (6,700,799) | (6,268,191)
Gross profit |  | 4,502,547 | 4,073,773
Distribution costs |  | (546,174) | (501,824)
Administrative expenses |  | (3,422,494) | (3,182,372)
Other operating income | 5 | 60,095 | 33,307
Operating profit |  | 593,974 | 422,884
Interest receivable and similar income | 9 | 24,094 | 12,087
Interest payable and similar expenses | 10 | - | (726)
Profit before tax |  | 618,068 | 434,245
Tax on profit | 11 | (169,592) | (114,599)
Profit after tax |  | 448,476 | 319,646
Retained earnings at the beginning of the year |  | 3,279,998 | 2,960,352
|  | 3,279,998 | 2,960,352
Profit for the year |  | 448,476 | 319,646
Retained earnings at the end of the year |  | 3,728,474 | 3,279,998
The notes on pages 11 to 25 form part of these financial statements.
Page 8
MECHANICAL & PIPEWORK FABRICATIONS LIMITED REGISTERED NUMBER: 01298017 STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2025
|  | 2025 |  | 2024
Note |  | £ |  | £
Fixed assets |  |  |  |  |
Tangible assets | 12 |  | 1,628,647 |  | 1,388,803
|  |  | 1,628,647 |  | 1,388,803
Current assets |  |  |  |  |
Stocks |  | 1,719,230 |  | 1,843,526 |
Debtors: amounts falling due within one year | 13 | 2,184,023 |  | 2,799,431 |
Cash at bank and in hand |  | 3,052,308 |  | 726,770 |
|  | 6,955,561 |  | 5,369,727 |
Creditors: amounts falling due within one year | 14 | (4,445,062) |  | (3,118,792) |
Net current assets |  |  | 2,510,499 |  | 2,250,935
Total assets less current liabilities |  |  | 4,139,146 |  | 3,639,738
Creditors: amounts falling due after more than one year | 15 |  | (3,011) |  | (12,040)
Provisions for liabilities |  |  |  |  |
Deferred tax | 16 | (407,161) |  | (347,200) |
|  |  | (407,161) |  | (347,200)
Net assets |  |  | 3,728,974 |  | 3,280,498
Capital and reserves |  |  |  |  |
Called up share capital | 17 |  | 500 |  | 500
Profit and loss account |  |  | 3,728,474 |  | 3,279,998
|  |  | 3,728,974 |  | 3,280,498
Page 9
MECHANICAL & PIPEWORK FABRICATIONS LIMITED REGISTERED NUMBER: 01298017 STATEMENT OF FINANCIAL POSITION (CONTINUED) AS AT 31 DECEMBER 2025 The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
................................................ Scott Ellis
Director
Date: 11 June 2026
The notes on pages 11 to 25 form part of these financial statements. Page 10
MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
1. | General information
The company is registered in England and Wales. It's registered office is Racecourse Road, Pinvin Industrial Estate, Pershore, Worcestshire, WR10 2EY. The company's principal activity continues to be that of the manufacture and supply of fire installation systems. 2.Accounting policies
| 2.1 | Basis of preparation of financial statements
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 management to exercise judgment in applying the Company's accounting policies (see note 3). The following principal accounting policies have been applied:
| 2.2 | Exemptions for qualifying entities under FRS 102
The company has taken advantage of the exemption, under FRS 102 paragraph 1.12(b), from preparing a statement of cash flows, on the basis that it is a qualifying entiity and its ultimate parent company Mechanical & Pipework Holdings Limited, include's the company cash flows in its consolidated financial statements.
| 2.3 | Revenue
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised: Sale of goods Revenue from the sale of goods is recognised when all of the following conditions are satisfied: ∙the Company has transferred the significant risks and rewards of ownership to the buyer; ∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; ∙the amount of revenue can be measured reliably; ∙it is probable that the Company will receive the consideration due under the transaction; and ∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.
| 2.4 | Interest income
Interest income is recognised in profit or loss using the effective interest method. Page 11
MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 2.Accounting policies (continued)
| 2.5 | Finance costs
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
| 2.6 | Pensions
Defined contribution pension plan The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations. The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of financial position. The assets of the plan are held separately from the Company in independently administered funds.
| 2.7 | Current and deferred taxation
The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively. The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income. Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that: ∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and ∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met. Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
| 2.8 | Tangible fixed assets
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Page 12
MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 2.Accounting policies (continued)
| 2.8 | Tangible fixed assets (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on the following basis. Depreciation is provided on the following basis:
|  |  |  | Plant and machinery | - | 25% | and 10% straight line
|  |  |  | Motor vehicles | - | 25% | straight line
|  |  |  | Fixtures and fittings | - | 25% | straight line
|  |  |  | Office equipment | - | 25% | straight line
|  |  |  | Computer equipment | - | 25% | straight line
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.
| 2.9 | Stocks
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads. At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.
| 2.10 | Debtors
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
| 2.11 | Cash and cash equivalents
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
| 2.12 | Creditors
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method. Page 13
MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 2.Accounting policies (continued)
| 2.13 | Provisions for liabilities
Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made. Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties. Increases in provisions are generally charged as an expense to profit or loss.
| 2.14 | Financial instruments
The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments. The Company has elected to apply the recognition and measurement provisions of IFRS 9 Financial Instruments (as adopted by the UK Endorsement Board) with the disclosure requirements of Sections 11 and 12 and the other presentation requirements of FRS 102. Financial instruments are recognised in the Company's Statement of financial position when the Company 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 Company's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments. Page 14
MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
3. | Judgments in applying accounting policies and key sources of estimation uncertainty
To be able to prepare financial statements in accordance with FRS102, Mechanical & Pipework Fabrications Limited must make certain estimates and judgments that have an impact on the policies and the amounts reported in the annual accounts. The estimates and judgments are based on historical experiences and other factors including expectations of future events that are believed to be reasonable at the time such estimates and judgments are made. Actual experience may vary from these estimates. The estimates and assumptions which have the most significant risk of causing a material adjustment to the carrying amounts of assets and liabilities are discussed below: Depreciation and amortisation: Mechanical & Pipework Fabrications Limited accounts for depreciation and amortisation in accordance with FRS102. The depreciation and amortisation expense is the recognition of the decline in the value of the assets and allocation of the cost of the asset over the periods in which the asset will be used. Judgments are made on the estimated useful life of the assets which are regularly reviewed to reflect the changing environment. Impairment of debtors: The Company makes an estimate of the recoverable value of trade and other debtors. When assessing impairment of trade and other debtors, management considers factors including the current credit rating of of the debtor, the ageing profile of debtors and histoical experience. Impairment of stocks: Certain factors could affect the realisable value of the company's stocks, including customer demand and market conditions. The company considers historic usage, expected demand, anticipated sales price, effect of new product introductions, product obsolscence and other factors when evaluating the value of stock. Deferred tax: Management estimation is required to determine the amount of deferred tax assets that can be recognised, based upon likely timing and level of future taxable profits together with an assessment of the effect of future planning strategies.
4. | Turnover
The whole of the turnover is attributable to the company's principal business activity.
| All turnover arose within the United Kingdom.
5. | Other operating income
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Net rents receivable | 60,095 | 33,307
|  | 60,095 | 33,307
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MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
6. | Auditors' remuneration
| During the year, the Company obtained the following services from the Company's auditors:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Fees payable to the Company's auditors for the audit of the Company's financial statements | 10,000 | 10,000
| The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.
7. | Employees
| Staff costs, including directors' remuneration, were as follows:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Wages and salaries | 4,007,411 | 2,545,171
| Social security costs | 490,848 | 261,110
| Cost of defined contribution scheme | 147,010 | 117,978
|  | 4,645,269 | 2,924,259
| The average monthly number of employees, including the directors, during the year was as follows:
|  |  | 2025 | 2024
|  |  | No. | No.
|  | Production and transport | 48 | 47
|  | Management and administration | 8 | 8
|  |  | 56 | 55
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MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
8. | Directors' remuneration
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Directors' emoluments | 1,568,686 | 687,850
| Company contributions to defined contribution pension schemes | 20,000 | 20,000
|  | 1,588,686 | 707,850
| During the year retirement benefits were accruing to 2 directors (2024 - 2) in respect of defined contribution pension schemes.
| The highest paid director received remuneration of £1,412,928 (2024 - £598,555).
| The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £10,000 (2024 - £10,000).
9. | Interest receivable
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Other interest receivable | 24,094 | 12,087
|  | 24,094 | 12,087
10. | Interest payable and similar expenses
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Finance leases and hire purchase contracts | - | 726
|  | - | 726
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MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
11. | Taxation
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Corporation tax |  |
| Current tax on profits for the year | 109,631 | 140,644
|  | 109,631 | 140,644
| Total current tax | 109,631 | 140,644
| Deferred tax |  |
| Origination and reversal of timing differences | 59,961 | (26,045)
| Total deferred tax | 59,961 | (26,045)
| Tax on profit | 169,592 | 114,599
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MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 11.Taxation (continued)
| Factors affecting tax charge for the year
| The tax assessed for the year is the same as (2024 - higher than) the standard rate of corporation tax in the UK of 25% (2024 - 25%). The differences are explained below:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Profit on ordinary activities before tax | 618,068 | 434,245
| Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2024 - 25%) | 154,517 | 102,048
| Effects of: |  |
| Other differences leading to an increase (decrease) in the tax charge | 15,075 | 12,551
| Total tax charge for the year | 169,592 | 114,599
| Factors that may affect future tax charges
There were no factors that may affect future tax charges. Page 19
MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
12. | Tangible fixed assets
|  | Plant and machinery | Motor vehicles | Fixtures and fittings | Office equipment | Computer equipment
|  | £ | £ | £ | £ | £
| Cost or valuation |  |  |  |  |
| At 1 January 2025 | 1,790,352 | 1,348,019 | 51,646 | 22,998 | 51,502
| Additions | 310,215 | 573,432 | 1,649 | 3,207 | 7,997
| Disposals | (25,000) | (484,428) | - | - | -
| At 31 December 2025 | 2,075,567 | 1,437,023 | 53,295 | 26,205 | 59,499
| Depreciation |  |  |  |  |
| At 1 January 2025 | 1,128,752 | 668,376 | 32,503 | 13,773 | 32,310
| Charge for the year on owned assets | 237,363 | 276,746 | 11,447 | 3,510 | 11,407
| Disposals | (25,000) | (368,245) | - | - | -
| At 31 December 2025 | 1,341,115 | 576,877 | 43,950 | 17,283 | 43,717
| Net book value |  |  |  |  |
| At 31 December 2025 | 734,452 | 860,146 | 9,345 | 8,922 | 15,782
| At 31 December 2024 | 661,600 | 679,643 | 19,143 | 9,225 | 19,192
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MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 12.Tangible fixed assets (continued)
|  | Total
|  | £
| Cost or valuation |
| At 1 January 2025 | 3,264,517
| Additions | 896,500
| Disposals | (509,428)
| At 31 December 2025 | 3,651,589
| Depreciation |
| At 1 January 2025 | 1,875,714
| Charge for the year on owned assets | 540,473
| Disposals | (393,245)
| At 31 December 2025 | 2,022,942
| Net book value |
| At 31 December 2025 | 1,628,647
| At 31 December 2024 | 1,388,803
| The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Motor vehicles | 18,844 | 27,219
|  | 18,844 | 27,219
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MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
13. | Debtors
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Trade debtors | 2,141,974 | 2,757,382
| Prepayments and accrued income | 42,049 | 42,049
|  | 2,184,023 | 2,799,431
14. | Creditors: Amounts falling due within one year
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Trade creditors | 1,330,304 | 1,020,699
| Amounts owed to group undertakings | 1,121,359 | 1,144,385
| Corporation tax | 109,631 | 140,644
| Other taxation and social security | 228,601 | 124,292
| Obligations under finance lease and hire purchase contracts | 9,030 | 9,030
| Other creditors | 188,787 | 140,521
| Accruals and deferred income | 1,457,350 | 539,221
|  | 4,445,062 | 3,118,792
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MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
15. | Creditors: Amounts falling due after more than one year
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Net obligations under finance leases and hire purchase contracts | 3,011 | 12,040
|  | 3,011 | 12,040
| The following liabilities were secured:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Net obligations under finance leases and hire purchase contracts | 12,040 | 21,070
|  | 12,040 | 21,070
| Details of security provided:
The hire purchase liabilities are secured on the assets to which they relate as per note 12 to the financial statements.
16. | Deferred taxation
|  | 2025 | 2024
|  | £ | £
| At beginning of year | 347,200 | 373,245
| Charged to profit or loss | 59,961 | (26,045)
| At end of year | 407,161 | 347,200
| The provision for deferred taxation is made up as follows:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Accelerated capital allowances | 407,161 | 347,200
|  | 407,161 | 347,200
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MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
17. | Share capital
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
|  | Allotted, called up and fully paid |  |
|  | 500 (2024 - 500) Ordinary shares of £1.00 each | 500 | 500
18. | Related party transactions
| The company rent property for its own use from a previous directors estate, re the late James Ellis, for an annual rental of £4,950 (2024 £4,950). The company also rents property for its own use from the Mechanical & Pipework Fabrications Limited Directors' Retirement Benefits Scheme for an annual rental of £64,158 (2024 £64,680). Both of these are currently under terms of informal commercial agreements. At the balance sheet date the company owed that Scheme £481 (2024 £481). The directors are also directors of RTJ International Limited, a company registered in England and Wales. During the year Mechanical & Pipework Fabrications Limited made purchases totalling £673,820 (2024 £476,466) from that company and made sales to that company of £nil (2024 £nil) and at the balance sheet date owed that company £143,881 (2024 £127,588). The company has taken advantage of the exemption contained within paragraph 33.1A of the Financial Reporting Standard 102 and has not disclosed transactions with other group members.
19. | PARENT COMPANY AND ULTIMATE CONTROLLING INTEREST
The parent company is Mechanical & Pipework Holdings Limited, a company registered in England and Wales. Copies of the financial statements can be obtained from Racecourse Road, Pinvin Industrial Estate, Pershore, Worcestshire, WR10 2E. The controlling interest in that company is held by The Estate of the late James Ellis.
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MECHANICAL & PIPEWORK FABRICATIONS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
20. | LIMITATION OF AUDITORS' LIABILITY
| The company has entered into a liability limitation agreement, the principal terms being as follows:- Any liability is limited, pursuant to Section 537 of the Companies Act 2006, to no less than such amount as is considered fair and reasonable in each individual circumstance and to a maximum of ten times the level of the fee for the audit service being carried out. The resolution approving this agreement is dated 1 December 2025.
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