Financial Statements
For the financial year ended 31 October 2025
Registered number: 02245377
Company Information
Contents
Strategic Report
For the financial year ended 31 October 2025
The directors present their strategic report for the year ended 31 October 2025.
The principal activity of the Company is the design and distribution of air fragrancing and hygiene products.
The key performance indicators of the business continue to be sales, gross profitability, profit before tax and cash flow. These accounts show the results of the Company's performance for the year ended 31 October 2025 with the comparatives covering the year ended 31 October 2024.
The business continues to build on previous successes and has focused on strengthening its position in its core geographical markets. This has been achieved by deepening the existing relationships with long term partners as well as forging relationships with new customers who are attracted to Vectair by the innovative product offering, supported by a first-class service level and technical support. Vectair prides itself on being a business that offers partners real solutions, whatever their needs, in the hygiene and aircare away from home sector.
Vectair has operated within a more stable macro-economic climate over the last 12 months. The CPIH inflation rate remained relatively stable, fluctuating from 3.5% to 4.1% through the period. This was up from the average of 3% during the second half of the previous period. Despite tracking without volatile fluctuation, this is above the government target inflation rate of 2.0%. The rate is forecast to decline towards the target rate through the next quarter (November 2025 to Jan 2026). The Monetary Policy Committee has made incremental cuts in the base rate of interest through this period, dropping steadily from 5% in October 2024 to 4% in October 2025, easing the cost of borrowing for businesses. During 2025, the employer National Insurance contribution rate was increased from 13.8% to 15%, placing increased budget considerations on overhead costs.
The ongoing conflict in Ukraine, coupled with volatile US policy on global tariffs has had ongoing impact on UK and EU economies. While Vectair Systems Ltd does not trade directly with the US, the tariffs implemented in 2025, coupled with retaliatory measures by other economies including China and EU, caused significant disruptions in global trade, leading to localised inflation and supply chain challenges. Despite this, oil and energy costs continued to stabilise, reducing gradually through the period to more normalised levels. This provided some relief in cost of freight and manufacturing. This period of stability may soon be coming to an end with the US and Israeli recent action against Iran. We are only 10 days into this conflict at the time of writing, but the cost of crude oil has already risen above $100 per barrel and flights and shipping through the Middle East region has been severely impacted. The likelihood of supply chain disruption is significant if this situation continues.
During 2025 the UK secured significant new trade agreements, particularly with the EU. While good for the wider UK economy, these agreements have not reversed the administration and duty costs incurred post Brexit. Vectair's US parent company, Vectair Acquisition Holdings LLC, established a Dutch registered entity, Vectair Systems (Netherlands) B.V. to enable the continued development of strong trading relationships for Vectair's growth in Europe. Key benefits are improved European product compliance and reduced administration/costs for Vectair's customers.
Sales in the UK were up 14% year on year. Sales growth was driven by passive aircare systems (V-Solid Evolution) and Urinal Screens. The UK’s focus on sustainability continues to build, including government-imposed reporting requirements and financial penalties, increasingly driving users towards solutions that are more sustainable and less hazardous in use and in post-use waste streams. There is significant variance in the application of credible sustainability claims across manufacturers, something that Vectair encourages key industry bodies to play a leading role in validating to ensure users are not misled.
The European region experienced strong growth of 13% over the previous year, driven by similar product trends to the UK. Growth was achieved across multiple countries, through both distribution partners and Private Label/OEM customers. This mix of growth drivers provides a solid foundation for future growth and expansion, including investment in a field-based business development manager in Spain from 1st November 2025. This local presence and language capability is part of a longer-term investment strategy.
The key performance indicators of the business continue to be sales, gross profitability, profit before tax and cash flow. These accounts show the results of the Company's performance for the year ended 31 October 2025 with the comparatives covering the year ended 31 October 2024.
The business continues to build on previous successes and has focused on strengthening its position in its core geographical markets. This has been achieved by deepening the existing relationships with long term partners as well as forging relationships with new customers who are attracted to Vectair by the innovative product offering, supported by a first-class service level and technical support. Vectair prides itself on being a business that offers partners real solutions, whatever their needs, in the hygiene and aircare away from home sector.
Vectair has operated within a more stable macro-economic climate over the last 12 months. The CPIH inflation rate remained relatively stable, fluctuating from 3.5% to 4.1% through the period. This was up from the average of 3% during the second half of the previous period. Despite tracking without volatile fluctuation, this is above the government target inflation rate of 2.0%. The rate is forecast to decline towards the target rate through the next quarter (November 2025 to Jan 2026). The Monetary Policy Committee has made incremental cuts in the base rate of interest through this period, dropping steadily from 5% in October 2024 to 4% in October 2025, easing the cost of borrowing for businesses. During 2025, the employer National Insurance contribution rate was increased from 13.8% to 15%, placing increased budget considerations on overhead costs.
The ongoing conflict in Ukraine, coupled with volatile US policy on global tariffs has had ongoing impact on UK and EU economies. While Vectair Systems Ltd does not trade directly with the US, the tariffs implemented in 2025, coupled with retaliatory measures by other economies including China and EU, caused significant disruptions in global trade, leading to localised inflation and supply chain challenges. Despite this, oil and energy costs continued to stabilise, reducing gradually through the period to more normalised levels. This provided some relief in cost of freight and manufacturing. This period of stability may soon be coming to an end with the US and Israeli recent action against Iran. We are only 10 days into this conflict at the time of writing, but the cost of crude oil has already risen above $100 per barrel and flights and shipping through the Middle East region has been severely impacted. The likelihood of supply chain disruption is significant if this situation continues.
During 2025 the UK secured significant new trade agreements, particularly with the EU. While good for the wider UK economy, these agreements have not reversed the administration and duty costs incurred post Brexit. Vectair's US parent company, Vectair Acquisition Holdings LLC, established a Dutch registered entity, Vectair Systems (Netherlands) B.V. to enable the continued development of strong trading relationships for Vectair's growth in Europe. Key benefits are improved European product compliance and reduced administration/costs for Vectair's customers.
Sales in the UK were up 14% year on year. Sales growth was driven by passive aircare systems (V-Solid Evolution) and Urinal Screens. The UK’s focus on sustainability continues to build, including government-imposed reporting requirements and financial penalties, increasingly driving users towards solutions that are more sustainable and less hazardous in use and in post-use waste streams. There is significant variance in the application of credible sustainability claims across manufacturers, something that Vectair encourages key industry bodies to play a leading role in validating to ensure users are not misled.
The European region experienced strong growth of 13% over the previous year, driven by similar product trends to the UK. Growth was achieved across multiple countries, through both distribution partners and Private Label/OEM customers. This mix of growth drivers provides a solid foundation for future growth and expansion, including investment in a field-based business development manager in Spain from 1st November 2025. This local presence and language capability is part of a longer-term investment strategy.
Page 1
Strategic Report (continued)
For the financial year ended 31 October 2025
Fair review of business (continued)
In the “Rest of the World” region, sales were flat vs. prior year, with sales gains offset by declines with partners in Australasia, the Middle East & India. Performance in these regions have been impacted by ongoing considerations regarding customer liquidity, combined with an influx of cheap manufacturer imports directly from regions such as China causing market disruption. Other factors include more localised sourcing strategies in regions such as Australasia, driven by sustainability (shortening of supply chain) and price benefits. In response, Vectair have instigated more localised manufacturing and are currently reviewing strategies in our key export markets to protect market shares, through product portfolio innovation relevant to the local market requirements.
Vectair continues to invest in product development and innovation in sustainable solutions to best meet the needs of the market. During this period, Vectair have launched a new, category redefining passive aircare system. V-Air Flow is “I’m Green” certified thanks to its 100% post-consumer recycled plastic dispenser and bio-based refills made with more than 50% plant-based material. Vectair have also achieved a reduction in packaging, using responsibly sourced raw materials and aligning our working practices to recommended ethical standards. This culminated in independent validation and recognition through achieving the EcoVadis Silver award in May 2025.
Through 2025, Vectair have re-structured its trading territories and customer ownership (account management), resulting in more clearly defined business units and more focused regional strategies, which will support future growth.
Overall, sales for the whole business grew £1.6m (11%) on the previous year. The directors are satisfied that this is a creditable performance in the current trading conditions.
As a global business, Vectair buys and sells products in sterling, euros and US dollars. The business model creates a partial natural hedge against exchange rate fluctuations which affords a greater level of protection than many other businesses. Vectair will continue to manage this exposure as best as it can.
The company works extremely hard to keep both the cost of manufacturing and the overheads of the business under control. This helps Vectair remain competitive in the marketplace, mitigating supplier/operating cost increases as far as possible to minimise the need to increase prices, providing customers economic solutions for their washroom and aircare needs. The profitability of the business is also vital to the continued funding of the research and development of new and innovative products.
Vectair continues to invest in product development and innovation in sustainable solutions to best meet the needs of the market. During this period, Vectair have launched a new, category redefining passive aircare system. V-Air Flow is “I’m Green” certified thanks to its 100% post-consumer recycled plastic dispenser and bio-based refills made with more than 50% plant-based material. Vectair have also achieved a reduction in packaging, using responsibly sourced raw materials and aligning our working practices to recommended ethical standards. This culminated in independent validation and recognition through achieving the EcoVadis Silver award in May 2025.
Through 2025, Vectair have re-structured its trading territories and customer ownership (account management), resulting in more clearly defined business units and more focused regional strategies, which will support future growth.
Overall, sales for the whole business grew £1.6m (11%) on the previous year. The directors are satisfied that this is a creditable performance in the current trading conditions.
As a global business, Vectair buys and sells products in sterling, euros and US dollars. The business model creates a partial natural hedge against exchange rate fluctuations which affords a greater level of protection than many other businesses. Vectair will continue to manage this exposure as best as it can.
The company works extremely hard to keep both the cost of manufacturing and the overheads of the business under control. This helps Vectair remain competitive in the marketplace, mitigating supplier/operating cost increases as far as possible to minimise the need to increase prices, providing customers economic solutions for their washroom and aircare needs. The profitability of the business is also vital to the continued funding of the research and development of new and innovative products.
The directors are satisfied with the cashflow of the business in view of the economic backdrop and considered the results for the year and the financial position at the year-end to be satisfactory.
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Strategic Report (continued)
For the financial year ended 31 October 2025
Looking ahead, the principal risks to the business result from the impacts of the ongoing conflict in Ukraine and the more recent conflict situation in Iran.
The conflicts in Ukraine, and more recently in Iran, both cause consequences in costs of raw materials and energy/fuel, as well as impacts on supply chain durations due to the enforced use of alternative, longer, shipping routes. The current and evolving situation in Iran has already led to significant increases in Oil prices, along with impact in the wider Middle East region, including UAE and Qatar. The impact on Vectair’s trading partners in these regions are not yet clear, but potential risks will be monitored closely and actions taken as required to minimise any impact to the business.
Management of customer debt to ensure Vectair are not exposed to any significant bad debt remains a key tool in maintaining cash flow and managing overall risk.
The continuity in the supply of our products and the components that make our products is key. The most notable impact currently is an extended transit time for any goods/components from the Far East. We are constantly reviewing and evaluating our supply chain to minimise the risk of any supply disruption.
As a business, we sell to over 100 countries and so exchange rate fluctuations can provide uncertainty as already noted above. To limit this risk, we only operate in sterling, euros or US dollars. In addition, we also benefit from partial hedges in that we both buy and sell in euros and US dollars. We monitor our exchange rate exposure regularly to minimise any risk.
The financial statements have been prepared on a going concern basis. The directors have reviewed and considered relevant information, including the annual budget and future cash flows in making their assessment.
Based on these assessments, given the measures that can be undertaken to mitigate the current adverse conditions, and the current resources available, the directors are satisfied that the company is able to meet its obligations and continue in operational existence for the twelve months from the date of the approval of financial statements. For this reason, the directors have adopted the going concern basis in preparing these financial statements.
The conflicts in Ukraine, and more recently in Iran, both cause consequences in costs of raw materials and energy/fuel, as well as impacts on supply chain durations due to the enforced use of alternative, longer, shipping routes. The current and evolving situation in Iran has already led to significant increases in Oil prices, along with impact in the wider Middle East region, including UAE and Qatar. The impact on Vectair’s trading partners in these regions are not yet clear, but potential risks will be monitored closely and actions taken as required to minimise any impact to the business.
Management of customer debt to ensure Vectair are not exposed to any significant bad debt remains a key tool in maintaining cash flow and managing overall risk.
The continuity in the supply of our products and the components that make our products is key. The most notable impact currently is an extended transit time for any goods/components from the Far East. We are constantly reviewing and evaluating our supply chain to minimise the risk of any supply disruption.
As a business, we sell to over 100 countries and so exchange rate fluctuations can provide uncertainty as already noted above. To limit this risk, we only operate in sterling, euros or US dollars. In addition, we also benefit from partial hedges in that we both buy and sell in euros and US dollars. We monitor our exchange rate exposure regularly to minimise any risk.
The financial statements have been prepared on a going concern basis. The directors have reviewed and considered relevant information, including the annual budget and future cash flows in making their assessment.
Based on these assessments, given the measures that can be undertaken to mitigate the current adverse conditions, and the current resources available, the directors are satisfied that the company is able to meet its obligations and continue in operational existence for the twelve months from the date of the approval of financial statements. For this reason, the directors have adopted the going concern basis in preparing these financial statements.
Page 3
Strategic Report (continued)
For the financial year ended 31 October 2025
Vectair will be launching several new products in the coming year, which will further reinforce its reputation as the market leader for innovative products. This innovation will continue to support the development of regional strategies, sustainability focus and also leverage new assets from Vectair’s sister companies in US.
As mentioned previously, the business is investing in European growth plans, through people and infrastructure. Vectair will continue to develop its existing business but also look to expand to geographic areas where currently there is little or no coverage.
The main objectives of the business are to:
As mentioned previously, the business is investing in European growth plans, through people and infrastructure. Vectair will continue to develop its existing business but also look to expand to geographic areas where currently there is little or no coverage.
The main objectives of the business are to:
−Enhance our reputation as a market leader by continuing to develop innovative products and continuing to offer a high level of customer service.
−Continue the global expansion of the business.
−Improve profitability and shareholder value.
−Identify risks facing the business and taking appropriate action to mitigate these risks as far as possible.
−Be aware of our environmental obligations as a responsible business.
−Encourage the personal and professional development of our staff for both their and the business's benefit.
The board would like to take this opportunity to thank all the staff at Vectair for all their hard work, dedication and support in helping to develop the business. Their efforts are, as always, very much appreciated.
On behalf of the board:
Page 4
Directors' Report
For the financial year ended 31 October 2025
The directors present their report and the audited financial statements for the year ended 31 October 2025.
The profit after tax for the year amounted to £2,073,893 (2024: £2,270,637 ).
During the year, the Company declared and paid an equity dividend on ordinary shares of £Nil (2024: £Nil).
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Directors' Report (continued)
For the financial year ended 31 October 2025
The directors who served during the year were:
The financial risk management objectives and policies of the Company, including exposure to currency risk, credit risk and liquidity risk are set out in note 18 to the financial statements.
The principal risk to the business is the global economic fallout from the actions of the new US Administration tied with the economic uncertainty resulting from the Russian invasion of Ukraine. The continued conflict between Israel and Palestine and the risk of this spilling further into the Middle East could impact sales in the region as well as cause additional supply chain delays with more shipping route disruption. Vectair will continue to monitor developments on these risks closely and be ready to act quickly to minimise any impact to the business.
Management of customer debt to ensure the business is not exposed to any significant bad debt remains a key tool in maintaining cash flow. As noted earlier, this has been at the expense of turnover in the rest of the World region this year.
The continuity in the supply of products and the components that make the products is key. Vectair is constantly reviewing and evaluating the supply chain to minimise the risk of any supply disruption.
As a business, Vectair sells to over 100 countries and so exchange rate fluctuations can provide uncertainty as already noted above. To limit this risk, the Company only operates in sterling, euros, or US dollars. In addition, the business also benefits from partial hedges, buying and selling in euros and US dollars. Exchange rate exposure is monitored regularly to minimise any risk.
The financial statements have been prepared on a going concern basis. The directors have reviewed and considered relevant information, including the annual budget and future cash flows in making their assessment.
Based on these assessments, given the measures that can be undertaken to mitigate the current adverse conditions, and the current resources available, the directors are satisfied that the Company is able to meet its obligations and continue in operational existence for at least twelve months from the date of the approval of financial statements. For this reason, the directors have adopted the going concern basis in preparing these financial statements.
The business will be launching several new products in the coming year which will further reinforce our reputation as the market leader for innovative products. Please refer to the Strategic Report for further details.
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Directors' Report (continued)
For the financial year ended 31 October 2025
The Company is engaged in research and development activity in relation to various projects. The research and development charge for the financial year was £Nil (2024: £Nil).
There have been no significant events affecting the Company since the year end.
The auditor, Grant Thornton, continues in office in accordance with section 485 of the Companies Act 2006.
This report was approved by the Board of Directors and was signed on its behalf by:
Page 7
Independent Auditor's Report to the Members of Vectair Systems Limited
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 'Responsibilities of the auditor 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 FRC's Ethical Standard and the ethical pronouncements established by Chartered Accountants Ireland, applied as determined to be appropriate in the circumstances of the entity. 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 Company's ability to continue as a going concern for a period of at least twelve months from the date 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 8
Independent Auditor's Report to the Members of Vectair Systems Limited (continued)
Other information comprises the information included in the Annual Report, other than the financial statements and our Auditor's Report thereon, including the Directors' Report and the Strategic Report. The directors are responsible for the other information. Our opinion on the financial statements does not cover the information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, 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 audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies in the financial statements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.
Opinions 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.
Page 9
Independent Auditor's Report to the Members of Vectair Systems Limited (continued)
Based on our understanding of the Company and industry, we identified that the principal risks of non-compliance with laws and regulations related to employment law, consumer protection and competition law and we considered the extent to which the non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006 and UK tax legislation. The audit engagement responsible individual considered the experience and expertise of the engagement team to ensure that the team had appropriate competence and capabilities to identify or recognise non-compliance with the laws and regulations. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to manipulate financial performance and management bias through judgements and assumptions in significant
Page 10
Independent Auditor's Report to the Members of Vectair Systems Limited (continued)
accounting estimates, in particular in relation to significant one-off or unusual transactions. We apply professional scepticism through the audit to consider potential deliberate omission or concealment of significant transactions, or incomplete/inaccurate disclosures in the financial statements.
In response to these principal risks, our audit procedures included but were not limited to:
- enquiries of management on the policies and procedures in place regarding compliance with laws and regulations,
including consideration of known or suspected instances of non-compliance and whether they have knowledge of
any actual, suspected or alleged fraud;
- inspection of the Company’s regulatory and legal correspondence and review of minutes of board meetings
during the year to corroborate inquiries made;
- gaining an understanding of the entity’s current activities, the scope of authorisation and the effectiveness of its
control environment to mitigate risks related to fraud;
- discussion amongst the engagement team in relation to the identified laws and regulations and regarding the risk
of fraud, and remaining alert to any indications of non-compliance or opportunities for fraudulent manipulation
of financial statements throughout the audit;
controls
- designing audit procedures to incorporate unpredictability around the nature, timing or extent of our testing
- challenging assumptions and judgements made by management in their significant accounting estimates, including
dilapidations provision, useful lives of depreciable assets, impairment of trade and other debtors and net
realisable value of stocks.
- review of the financial statement disclosures to underlying supporting documentation and inquiries of
management
The primary responsibility for the prevention and detection of irregularities including fraud rests with those charged with governance and management. As with any audit, there remains a risk of non-detection or irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or override of internal controls.
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.
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
Ireland
Page 11
Statement of Comprehensive Income
For the financial year ended 31 October 2025
Page 12
Statement of Financial Position
As at 31 October 2025
The financial statements were approved and authorised for issue by the Board of Directors and were signed on its behalf by:
The notes on pages 16 to 33 form part of these financial statements.
Page 13
Statement of Changes in Equity
For the financial year ended 31 October 2025
Page 14
Statement of Cash Flows
For the financial year ended 31 October 2025
Page 15
Notes to the Financial Statements
For the financial year ended 31 October 2025
Vectair Systems Limited (the "Company") is a UK registered private company limited by shares which has a registered office at Unit 3 Trident Centre, Armstrong Road, Basingstoke, Hampshire, RG24 8NU. The Company's registered number is 02245377.
The principal activity of the Company is the design and distribution of air fragrancing and hygiene products. For more information visit www.vectairsystems.com
The principal activity of the Company is the design and distribution of air fragrancing and hygiene products. For more information visit www.vectairsystems.com
2.Accounting policies
The financial statements are presented in Sterling (£), which is also the Company's functional currency.
The following principal accounting policies have been applied:
Page 16
Notes to the Financial Statements
For the financial year ended 31 October 2025
2.Accounting policies (continued)
Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Page 17
Notes to the Financial Statements
For the financial year ended 31 October 2025
2.Accounting policies (continued)
Interest income is recognised in the Statement of Comprehensive Income using the effective interest method.
Finance costs are charged to the Statement of Comprehensive Income 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.
Page 18
Notes to the Financial Statements
For the financial year ended 31 October 2025
2.Accounting policies (continued)
Intangible assets are made up of development costs incurred in relation to the design and development of products.
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
The estimated useful lives range as follows:
Page 19
Notes to the Financial Statements
For the financial year ended 31 October 2025
2.Accounting policies (continued)
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.
At each reporting date the Company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
The Company adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the Company. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to the Statement of Comprehensive Income during the period in which they are incurred.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Statement of Comprehensive Income.
Page 20
Notes to the Financial Statements
For the financial year ended 31 October 2025
2.Accounting policies (continued)
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
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 21
Notes to the Financial Statements
For the financial year ended 31 October 2025
2.Accounting policies (continued)
Basic financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other creditors, bank loans and other loans are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Derecognition of financial instruments
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.
Page 22
Notes to the Financial Statements
For the financial year ended 31 October 2025
2.Accounting policies (continued)
If the circumstances that gave rise to the impairment loss subsequently reverse, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but not in excess of the amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately in the Statement of Comprehensive Income.
Page 23
Notes to the Financial Statements
For the financial year ended 31 October 2025
Management evaluates its judgements on an ongoing basis. Management bases its judgements on historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.
The following judgements and estimates are considered important to the portrayal of the Company’s financial position:
A provision of £270,000 (2024: £248,000) has been made in the financial statements in relation to a potential dilapidation of the rental property over the length of the leasehold. This has been based on an estimate which has been derived from a review carried out by an independent property consultant.
Management charges are charged to a fellow subsidiary. These are calculated based on the directors' estimate of the time that key management has spent on the operations of the fellow subsidiary and these are based on set percentages for each member of key management.
The Company estimates the useful lives of tangible fixed assets based on the period over which the assets are expected to be available for use. The estimated useful lives are reviewed periodically and are updated if expectations differ from previous estimates due to physical wear and tear, technical or commercial obsolescence and legal or other limits on the use of the assets. The net book value of tangible fixed assets at year end is £846,649 (2024: £1,015,462).
Adequate allowance and provisions are made for specific accounts where objective evidence of impairment exists. The Company evaluates these accounts based on available facts and circumstances affecting the recoverability of the accounts, including, but not limited to, the length of the Company’s relationship with its contracting parties, contracting parties’ current credit status, average age of accounts, settlement experience, and historical loss experience. The total amount of trade debtors net of provision is £4,278,058 (2024: £3,528,188).
The directors have reviewed the year-end stock value and, based on their knowledge of the business, consider that the provision made to reflect the value of stock held at the year end is appropriate and that no further adjustment is necessary. The total amount of stock net of provision is £2,949,131 (2024: £2,915,234).
Page 24
Notes to the Financial Statements
For the financial year ended 31 October 2025
Page 25
Notes to the Financial Statements
For the financial year ended 31 October 2025
Page 26
Notes to the Financial Statements
For the financial year ended 31 October 2025
11.Taxation (continued)
Page 27
Notes to the Financial Statements
For the financial year ended 31 October 2025
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Notes to the Financial Statements
For the financial year ended 31 October 2025
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Page 29
Notes to the Financial Statements
For the financial year ended 31 October 2025
Page 30
Notes to the Financial Statements
For the financial year ended 31 October 2025
The Company is exposed to foreign currency risk due to a proportion of its trade receivables and trade payables are denominated in currencies other than sterling.
The objective of the Company in managing liquidity risk is to ensure that it can meet its financial obligations as and when they fall due. Liquidity risk is managed through regular review of cash flow forecasts and working capital requirements.
Credit risk arises principally from trade and other debtors. The Company manages this risk through ongoing monitoring of customer balances, collection performance and strong ongoing customer relationships.
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Page 31
Notes to the Financial Statements
For the financial year ended 31 October 2025
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Capital redemption reserve
Profit and loss account
Page 32
Notes to the Financial Statements
For the financial year ended 31 October 2025
25.Financial commitments, guarantees and contingent liabilities
The Company has an HM Revenue & Customs Duty Deferment Guarantee in the sum of £160,000 (2024: £160,000).
At the financial year end, the immediate parent company, which is also the parent for the largest and smallest group of undertakings for which the group financial statements are drawn up for and of which the Company is a member is Vectair Acquisition Holdings LLC , a company whose registered office is 4450 Excelsior Blvd Suite 440, St Louis Park, MN 55416, USA.
Page 33