The directors present the strategic report for the year ended 30 April 2026.
Client Server Limited is a respected recruitment consultancy, specialising in both permanent and contract recruitment of staff within the technology space across an intentionally diverse range of client companies.
The company maintains a good reputation with both our clients and candidates.
We continue to target growth, both across the UK and Europe whilst ensuring we maintain our position as the preferred choice of recruitment partner for many of our existing clients.
Despite the ongoing economic malaise and the persisting cautious recruitment activity by technology companies in FY 2026, the directors remained positive throughout FY 2026, seeing marginally improved recruitment spending across the technology sector.
With the notable exception of investment in the AI sphere, the technology sector continues to experience difficulty in sourcing funding. As a result, many of our smaller client companies continued from prior year to maintain a very cautious approach towards recruitment throughout the year. This was also observed at larger, more established companies where recruitment was delayed, suspended or reduced.
During FY 2026, the company experienced an improvement in performance whilst carefully controlling costs. This has resulted in a positive shift towards our recovery.
FY 2026 continued to be another challenging year for Client Server Limited, with the recruitment industry as a whole continuing to suffer from uncertainty both across the European/global economic market and within the UK.
We are pleased to report the company saw an improvement in turnover across FY 2026, achieving the booked revenue target for the first time in 4 years. We continued to prudently manage staff overheads and supplier costs, but continued increases in staff costs via taxation, meant the benefits from the improved turnover and headcount control did not fully translate into profit.
Across the financial year, although we saw fluctuating demand, we generated increased opportunities, resulting in improved trading which positively impacted FY 2026.
The company increased turnover from £13,610,823 in FY 2025 to £15,637,551 in FY 2026. This increase was due to a mixture of both new client business coupled with a minor upswing from existing clients.
Gross profit improved from £6,410,416 in 2025 to £7,643,238. This resulted in a marked improvement from losses of £1,309,728 in FY2025 to pre-tax profit of £95,874 in FY 2026
Gross profit margin moved from to 47% to 49%, reflecting an increase in both contract business and permanent placements, whilst administrative expenses remained static at £7,612,895 (£7,632,838 in FY 2025).
The directors use performance (booked new revenue gross margin) against target as a core KPI when measuring performance. During FY 2026, we achieved 99.5%, which is pleasing and significant improvement compared to FY 2025 & FY2024.
Financial Year | 2026 | 2025 | 2024 | 2023 | 2022 |
Booked New Revenue* | £7,309,540
| £6,265,799 | £5,350,806 | £8,572,488 | 9,058,179 |
Booked New Revenue Gross Margin Vs Target | 99.5% | 86.9% | 57% | 98% | 139% |
*Booked New Revenue is the measure of business done at the point a candidate has accepted a role.
During FY 2026 our average permanent placement fee increased. We believe this increase was the result of both salary inflation and continued strong offers by employers to attract the best talent. We have also seen a marginal improvement in the % fee we charge, driven by client struggles of sourcing quality candidates.
As noted in previous years, the increase in counter offers (for employees to not leave) also continued, resulting in high salary awards for top quality candidates.
Client Server continues to differentiate itself from competitors by offering a more thorough, transparent, and higher quality service.
The company continues to focus on the development of its employees to maintain and grow this quality service. This is achieved by our extensive induction and ongoing training programmes.
The market to attract and retain quality staff remains a challenge across all industries, and the recruitment market itself is prone to this. Following the decision in mid-2024 to decrease the number of our consultants, we traded successfully over FY 2026 with a smaller staffing level. The decision to carefully manage the number of consultants vs client demand is ongoing, with a forecasted small increase in headcount for FY 2027 as we look forward to a better year ahead.
Following the strengthening of our management structure and training capability, we have seen a noticeable positive impact, improving our ability to attract and train staff in a very competitive market.
With our pipeline for additional recruitment also on track, we are on target to achieve our forecasted numbers of consultants for FY 2027 but are mindful of the need to rapidly adjust staffing levels to take account of business demand.
As a company, we remain committed to the recruitment and training of quality employees. Employee reward and recognition continue to be reviewed and enhanced. Following an extensive review, we committed to a wholesale change of our commission scheme which we implemented at the start of FY 2026. The new scheme better rewards those employees who make a difference to all facets of our business, ensuring a fairer reward for high performance in this challenging market. Our employee share option scheme continues to be an attractive benefit to our staff, with the number of employees participating in this scheme increasing.
Recruitment Market Challenges
In FY 2025 we noticed a small improvement in recruitment sentiment across the technology market, which we anticipated would lead to an increase in demand for recruitment services. However, various ongoing global economic events appeared to thwart this recovery, which has to a lesser extent, continued. Overall, the market improvement appears to have been marginal, with recruitment remaining subdued. Having successfully managed to increase our share of this highly competitive market, we are forecasting an improvement across results for FY 2027.
We anticipate that this trend will continue for an extended period. However, ongoing technology advances, particularly those involving AI and Security are increasing demand for our services. The rise in use of AI is often creating as many problems as it solves, with companies struggling to implement effective solutions whilst safeguarding processes and data. The ever-increasing use of technology across businesses effectively creates a need for enhanced security relating to both the systems and the information data the systems rely upon. This strongly suggests the technology recruitment market will steadily improve over the near to medium-term future.
Despite changes across larger technology businesses, particularly in the US, most companies in the technology space continue to experience difficulty sourcing and retaining technology staff. While we are expecting some improvement in demand within the technology recruitment market, we are mindful that this could be affected by any further economic downturn. However, we are confident the diversity in our client base across many sectors will help to protect us.
We continue to monitor both our number of active clients and the number of vacancies to provide the best possible visibility of market demand and enable us to capitalise on opportunities as and when they arise.
The UK’s relationship with the EU, continues to have serious implications for the UK technology market, particularly in terms of immigration and the visa system. The UK’s comparatively expensive and complex visa process appears to be less attractive to many companies and potential candidates. Other EU countries appear less restrictive, which exacerbates the ongoing shortage of available talent and applicants for roles based in the UK. As a result, companies are often faced with either paying inflated salaries to attract and retain talent in the UK, or moving to an offshore model and building technology centres abroad going forward – although reports suggest this does appear to come with its own managerial challenges.
We have also seen a consistently higher proportion of candidates receiving multiple competing offers, including counter offers from their own employer to not leave. This has resulted in an increased percentage of candidates accepting counter offers to remain at their existing employer. In the most recent FY, we have also seen an increase in the number of our placements failing probation, we are not sure at this stage if this is related to changes in employment rights or is driven by clients struggling to find the quality of employee they need.
A continuing concern for 2027 and beyond remains the shortage of available talent. The UK has long been at the centre of technology innovation, making it an attractive place to work. This, in turn, creates a desire for companies to invest and make use of this pool of technologists. Whilst the UK remains a reasonably strong technology innovative centre, there are worrying signs of the continued rise of the attractiveness of overseas locations as alternative centres for technology. To mitigate this for our business, we aim to continue to grow our overseas operations where demand is strong.
The company has policies and procedures in place to mitigate the following financial risks:
Liquidity Risk: During FY 2026, the Board took the decision to change our invoice financing facility to further help reduce liquidity risk going forward.
The company now has sufficient headroom in cash at bank and financing agreements to mitigate this risk. Losses over FY 2025 eroded reserves to such an extent, an invoice discounting facility was required to maintain cashflow. During FY 2026 a larger invoice discounting facility was sourced to ensure cash reserves are sufficient both now and for at least the next 12 months.
Cashflow Risk: The Board manages and forecasts cashflows across the year which allow for early action in the case of potential issues being identified. The cash headroom also provides mitigation against the risks posed.
Interest Risk: The remaining balance of the 2021 CBILS loan is repayable over the next 6 months at a fixed interest rate. The company began using an invoice discounting debt finance facility during the year which has increased exposure to interest risk.
Credit Risk: Strong credit control procedures are used to mitigate the risk of bad debts.
Currency Risk: The current size of operations in overseas territories means the company is not significantly exposed to currency risk. As we continue to increase our overseas business, this is something we are prepared for with offerings of lower exchange rate charges and better exchange rates from various suppliers.
Client Server as a business is well-structured, with strong processes, management systems, and succession planning to allow for the continued growth of the company. The recent periods have presented opportunities for further strengthening of, and improvements to, these processes and systems. During FY 2026, we successfully implemented the final stages of an ambitious project to update, strengthen, and improve our own IT infrastructure, allowing full employee flexibility whilst improving security of both candidate, client and our own data. We expect to continue with further incremental improvement projects, which are forecasted to be borne out of cashflow without the need for finance.
As a business, we frequently review the mix of our clients to intentionally continue our low reliance on any one sector or size of business. Our clients range from newly formed start-ups to large multi-national corporations, across a wide range of business domains and industries, such that we consider our risk of exposure to a particular market sector to be minimal. In addition, we carefully monitor our business concentration, with our three largest clients amounting to less than 15% of turnover.
Future Opportunities and Outlook
The challenge of sourcing, recruiting and retaining talented individuals in the technology arena continues. In light of this, while we expect FY 2027 to be challenging, we intend to deliver good results. Our goal for FY 2027 is to return our net profitability to at least 5% pre-tax.
There are a number of factors which could potentially have an impact:
The number of active live roles across our clients increased during the second half of FY 2026. Currently the number of live roles we are working at any one time has almost risen back to our ideal position. We have also seen this number to be relatively stable. Whilst we are working to maintain/increase this number across both existing and new clients, we are also carefully monitoring for any adverse indicators or actual decline in order to review and potentially adjust our cost base, as necessary.
Due to the ongoing uncertainties within our market and the need to be able to react swiftly to potential market changes, we have made the decision to try and move to a more flexible office model, which is predicted to result in substantial savings.
The UK continues to be attractive to companies due to the number of talented technologists and the unique innovation we deliver; therefore, the number of companies looking for key talented individuals continues to rise. However, as previously noted, other countries are promoting their own technology opportunities, threatening the UK’s position as a leader in this space. In response, we created a new ‘Europe’ team in 2021, and this has continued to grow our overseas offering. Our intention is to further capitalize on this opportunity, continuing the expansion of our services to clients based in Europe and beyond.
The decline previously observed in the number of overseas candidates available or interested in coming to the UK (as their own countries became more attractive due to increasing local salaries and more interesting or varied work) has seemingly stabilized, resulting in a lower number of overseas candidates who can work without the need for complex visa applications. We did see a slight increase in the number of both candidates and clients prepared to face the challenges and costs associated with the UK’s visa process, but with the current flat market, the requirement for doing this has stalled. When the appetite for recruitment returns, we forecast this will commence again to a limited degree.
Our focus on growing our contract offering delivered solid results over FY 2026 with a noticeable increase. Our strategy for the future is to continue to increase this service.
On behalf of the board
The directors present their annual report and financial statements for the year ended 30 April 2026.
The results for the year are set out on page 10.
No ordinary dividends were paid (2025: £nil). The directors do not recommend payment of a final dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law, the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period.
In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
make judgements and accounting estimates that are reasonable and prudent; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
We have audited the financial statements of Client Server Limited (the 'company') for the year ended 30 April 2026 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the 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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
In planning and designing our audit tests, we identify and assess the risks of material misstatements within the financial statements, whether due to fraud or error. Our assessment of these risks includes consideration of the nature of the industry and sector, the control environment and the business performance along with the results of our enquiries of management, about their own identification and assessment of the risks of irregularities. We are also required to perform specific procedures to respond to the risk of management override.
As a result of this assessment, we considered the opportunities and incentives that may exist within the company for fraud and identified that the greatest area of risk was in relation to management override, going concern and completeness of income.
We have obtained an understanding of the legal and regulatory frameworks that the company operates in from discussions with the directors and our knowledge of the company and its industry sector. We have focused on the provisions of those laws and regulations that have 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, local tax legislation, Employment Agencies Act 1973 and Conduct of Employment Agencies and Employment Businesses Regulations 2003.
We performed the following audit procedures after consideration of the above risks which included the following:
enquiry of management of actual and potential litigation and claims;
testing the completeness of turnover through detailed testing of sales invoices and review of post year end sales to identify any revenue that should have been recognised in the year under audit;
review of forecasts, assessing the reasonability of the inputs and also discussing these with management ;
reviewing correspondences with HMRC;
reviewing financial statement disclosures and testing these to supporting documentation to assess compliance with applicable laws and regulations;
performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; and
in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
The engagement partner has assessed that all engagement team members were made aware of the relevant laws and regulations and potential fraud risks and were reminded to remain alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. The risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
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 auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
The profit and loss account has been prepared on the basis that all operations are continuing operations.
Client Server Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit C Thames Mews, Portsmouth Road, Esher, Surrey, KT10 9AD.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of Client Server Group Limited. These consolidated financial statements are available from its registered office, Unit C Thames Mews, Portsmouth Road, Esher, Surrey, KT10 9AD.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
The expense in relation to options over the parent company’s shares granted to employees of the entity is recognised by the entity as a capital contribution, and presented as an increase in the parent company’s investment in the subsidiary.
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
In determining the charge to the Statement of Comprehensive Income, the directors have used the Black-Scholes model which makes assumptions about future performance, retention and timescales and is therefore a best estimate. For the share options in issue with performance based vesting criteria the directors have made an estimate as to the probability of performance-based share options meeting the vesting conditions attached to them. The directors have estimated this to be 67% for options issued under the 2022 scheme.
Provisions are made in respect of dilapidations and bad debts, and are made based on management's best estimate of cost using industry averages for dilapidations and past experience for bad debts.
The average monthly number of persons (including directors) employed by the company during the year was:
Their aggregate remuneration comprised:
The actual charge for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:
At the balance sheet date, the company has trading losses available for carry forward against future taxable profits. These losses have arisen from prior periods and remain unutilised. The total carried forward losses are £596,290 (2025: £909,450). Deferred tax asset of £162,488 has not been recognised in respect of these losses due to uncertainty over the timing of future taxable profits.
Amounts owed by parent and group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.
The bank loan of £83,333 (2025: £283,333) is secured by a fixed and floating charge over the assets of the company. The loan is repayable 6 years after its drawdown in 2020, during the year interest has been fixed at a rate of 2.89%. This facility is supported by the Coronavirus Business Interruption Loan Scheme.
The company has entered into a debt factoring arrangement under which trade debtors are financed to a factor. The company retains the credit risk associated with these receivables. The liability owed to the factor at the year end of £1,024,476 (2025: £765,273) is included in other borrowings. At the year end, the carrying amount of trade receivables factored is £1,309,639 (2025: £1,249,047).
The discounting facility changed during the year and now has a maximum limit of £2,000,000 (2025: £1,000,000) with an advance rate of 90% of approved receivables and a discount charge for debts payable in Sterling and in Euros 2.25% over the base rate of the Bank of England from time to time in force on funds in use subject to a minimum base rate of 2.125%.
Invoice factoring facilities are secured by a full title guaranteed charge in favour of them over all freehold and leasehold land & buildings as well as all fixed plant and machinery, both current and future by way of a fixed charge. There are also personal guarantees from the directors limited to £150,000 each.
The dilapidations provision relates to expected expenditure for re-instating the premises it rents to its original condition.
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund. Contributions totaling £3,342 (2025: £4,998) were payable to the fund at the year end and are included in creditors.
The company's ordinary shares and ordinary A shares all rank pari passu in respect of rights and obligations, carrying no rights to fixed income and each carry the right to one vote at general meetings of the company.
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
During the year the company entered into the following transactions with related parties:
The company has taken advantage of the exemptions provided by Section 33 under FRS102 'Related Party Disclosures' and has not disclosed transactions entered into between two or more members of a group, provided that any subsidiary undertaken which is a party to the transaction is wholly owned by a member of that group.
This balance was settled by the director shortly after the year end.