The directors present the strategic report for the year ended 31 December 2025.
Radwell is widely recognised as the global market leader. The European facility plays a key role in delivering goods to Canada and Mexico as well as over 130 countries across Europe, the Middle East, and Africa (‘EMEA’). It also supports telesales and web sales through a multi-lingual call centre.
The Group specialises in stocking and selling new and surplus industrial automation, electronic, and electrical control equipment, with the technical expertise to repair such items. Radwell differentiates itself through competitive pricing, extensive product availability, robust web sales capabilities, and a strong commitment to customer service.
The market for obsolete automation equipment continues to expand, and Radwell maintains a leading position as the world’s largest source of industrial surplus products. Management remains confident that the Group’s core mission of continuous improvement will drive sustained growth, further strengthening the financial position of both the Group and its affiliated Radwell companies.
Performance during the year and the position at the reporting date
Revenues for the year totalled £121,919,395, representing a 3% increase compared to £118,114,821 in 2024. Profit before taxation stood at £7,692,281 (2024: £14,940,985), equating to 6% (2024: 13%) of revenues. The Statement of Financial Position reflected a rise in net assets, increasing from £79,741,914 to £81,259,561.
The Directors have a clear understanding of the key factors contributing to the year-on-year decline and their alignment with the strategic plan. In response, they are actively implementing targeted initiatives, focussed on its core business of carrying volumes of inventory to rapidly supply components to its customer base, to exceed the financial targets set for 2026.
The overall financial position of the Group at year ended 31 December 2025 is sufficient to continue with the deployment of its strategic growth objectives for 2026.
The Group is very goal and metric driven. The key performance indicators include, but are not limited to, sales goals and gross margin. Goals and metrics are tracked by company and business segment and are communicated to employees on a real time basis throughout the day, including performance boards located throughout all departments.
Revenues for the Group are reported by the geographical areas of the UK, Rest of Europe, Canada and Rest of World. Net revenues as a percentage of total net revenues for year 2024 were UK 19.4%, Rest of Europe 14.5%, Canada 42.9% and Rest of World 23.2%. See note 3 for further analysis.
Below is a summary of the key performance indicators for the current and comparative year:
| 2025 | 2024 |
Turnover £'000 | 121,919 | 118,115 |
Gross margin | 36.5% | 41.4% |
EBITDA £'000 | 9,232 | 17,744 |
Average employees | 441 | 429 |
Turnover per average employee | 276,460 | 275,326 |
The Radwell culture remains focused on its core mission of continuous improvement to provide the highest level of customer service and further investment in quality testing equipment, improving business processes and talent development.
Principal risks and uncertainties
Radwell's scale, global reach, established brand, wide product range and service support for new and surplus products supported by repair capability help maintain a market leading position. Some smaller players attempt to copy the model and there are national competitors in the repair space. Radwell mitigates this competitiveness with excellent customer service, increasing levels of product quality, testing capabilities, faster turnaround / response times and strong personal relationships. The result of this strategic objective is reflected in the sales growth as previously outlined.
The competitive environment can be complex in some geographies as Radwell provides services directly to end users as well as to resellers. These resellers could be described as complementary competitors but ultimately, these companies facilitate a wider customer reach for Radwell.
Foreign exchange risk
The results of operations and financial position are measured using the functional currency of the primary economic environment in which the entity operates. Transactions are conducted in numerous currencies and the functional currencies are translated to Pound Sterling for consolidated financial reporting. The Group is exposed to exchange rate fluctuations and hence, currency rates changes are monitored to minimize the effect on results of operations.
Liquidity risk
The directors recognise liquidity risk as a principal risk and uncertainty that could impact the Group’s ability to meet its financial obligations as they fall due. Liquidity risk arises from potential mismatches between the timing of cash inflows and outflows, particularly during periods of market disruption or operational stress.
Credit risks
As the Group continues to service many sales territories, the requests for credit accounts also increases.
Credit risks (continued)
Credit reports are obtained and evaluated for new customers for the issuance of credit. The Group routinely reviews the outstanding credit and financial strength of its customers to ensure ongoing credit worthiness.
Accounts receivable represents the amount invoiced less an allowance for doubtful accounts. Management believes its allowance for doubtful accounts is adequate based on history of past write-offs, collections and management's evaluation of accounts overdue.
The Directors are confident that the organisation is well positioned for future growth, supported by existing staffing levels and a range of strategic initiatives.
The Group will continue to invest in information technology, engineering and testing capabilities, internal automated processes and personnel to improve overall efficiency, productivity and customer service.
Radwell International India Private Limited was established on 16 March 2026 as a subsidiary of Radwell Canada, as a cost center for global Radwell IT services. The Group also acquired IRS Robotics in Netherlands on 13 July 2026.
Sales growth for the year ended 31 December 2026 is expected to be 8%, based on the need to implement more market gain strategies and tools, along with a recognition of the changed market space as supply chain values and availability of components have now returned to post covid levels.
The directors of Radwell International- Europe Limited confirm that throughout the financial year ended 31 December 2024, they have acted in accordance with their duties under Section 172 of the Companies Act 2006. In doing so, they have had regard to the following six factors:
Long term consequences of decisions
The Board considers the long-term implications of strategic decisions, including investments in technology, sustainability, and workforce development. The directors have continuously reinvested in the Group and have strategically placed us in a position to achieve long term success. Monthly Board meetings are held, during which shareholders convene for a full day dedicated to business review, strategic goal setting, and decision-making.
Interests of the Group’s Employees
Radwell are equal opportunities employers. The diverse range of countries supported from the Group facilities means that there are staff from all over the world working in the facilities. The number of employees for the consolidated group as of year ended 31 December 2025 totalled 441 (2024: 429).
Employee engagement remains a priority. At Radwell all employees are considered family and the decisions that are made from a high level are made to ensure that all family members are in a safe position long term. There is a great level of communication and coordination that occurs between the board members and employees at Radwell.
Radwell is committed to recruiting top talent to ensure the highest standards of customer experience. The organisation also prioritises internal promotion, supported by ongoing training and development of key employees. Regular management and employee communication meetings are held to address a wide range of operational and people-related matters.
Fostering Relationships with Suppliers, Customers, and Others
We maintain open and collaborative relationships with key stakeholders. We have high volumes of both suppliers and customers but where practicably possible we carry out regular supplier reviews and customer satisfaction tracking, to help us build trust and ensure mutual benefit. Our procurement team also prioritises ethical sourcing and fair payment terms.
Impact of Operations on the Community and Environment
Environmental sustainability is embedded in our operations. The organisation is committed to reduce all waste and has a culture which cares for the environment. Radwell fully complies with the European WEEE directive
2012/19/EU and offers a support service to customers to dispose of their electrical equipment and the organization has very structured recycling routines and methodologies. Certifications received by the Group include the following:
ISO 14001:2004 Environmental Management System Certification, received 25 September 2015, that establishes the framework to implement routines and processes that reduce the environmental impact via recycling, waste reduction, reduced energy consumption and ultimately reduced cost.
ISO 45001:2018 Occupational Health and Safety Management System establishes the framework for identifying, controlling, and managing occupational health and safety risks and opportunities. In addition, it offers a chance to benchmark OHS practices against global best practices. Previously the certificate that was held was OHSAS: 18001:2007, which was updated to the current certificate in 2023.
ISO 9001:2015, Quality Management Systems, received 31 August 2018, related to the stocking, repairing, and selling of new and surplus industrial automation, MRO, pneumatic, motion, electronic, hydraulic, HVAC, and electrical and control equipment for plant floor and facility maintenance machinery.
Maintaining a Reputation for High Standards of Business Conduct
The Group is committed to conducting business with integrity, transparency, and accountability. We recognise that corruption and bribery pose significant risks to our reputation, operations, and stakeholder trust.
Acting Fairly Between Members of the Group
The Board ensures that all shareholders are treated fairly and equitably. Transparent communication is maintained through quarterly updates, and shareholder feedback is considered in strategic planning. No decisions were made that unfairly advantaged or disadvantaged any group of members.
The directors present their annual report and financial statements for the year ended 31 December 2025.
The results for the year are set out on page 11.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Radwell focuses on being the number one provider of industrial automation equipment in its chosen areas and markets, therefore staying up to date and continuing to develop industry leading capabilities and solutions has been a pillar that we base our business on. A part of developing our industry leading capabilities is through our research and development efforts that occur across many departments at Radwell. The departments who play a role in R&D are Engineering, Product and Market Expansion (PME), and IT.
Our Engineering & PME team’s priority is creating test assets and fixtures which are used to mimic the environment that our products are used in by the customer. The ability to fully test products in the surplus and repair categories have led the Radwell brand to by synonymous with quality. To exemplify this, we provide an industry leading 2-year product warranty with Radwell and boast warranty rates of below 0.5% for surplus and under 5% for repair.
Radwell is always trying to look to the future through innovation and developing exciting new products and services through customer feedback. Our latest strategic offerings are Automation Lifecycle Analysis and spares-vault which will facilitate us being a stronger partner, with deeper ties into our customers business that will facilitate even faster response times and greater quality of support.
The Group's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.
Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the Group's performance.
There is no employee share scheme at present, but the directors are considering the introduction of such a scheme as a means of further encouraging the involvement of employees in the company's performance.
The auditor, Saffery LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Energy usage in this disclosure covers all operations throughout the UK and Europe. The primary contributors are electricity and cash consumed in buildings and fuel used for business mileage.
Energy usage has been taken from utility bills. Water usage has been taken from water bills. Vehicle fuel figures have been taken from CO2 reporting from the company fuel card. Waste disposal has been calculated from the waste tickets provided by the service providers. Estimates have been used and extrapolated where data has not been available.
The Group has followed the 2019 HM Government Environmental Reporting Guidelines. The Group has also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for Company Reporting
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £m of revenue.
The Group is looking at the total emissions to see where reductions can be made. We have purchased two hybrid vehicles with a view to purchasing more in the future, to replace the ageing vehicles in the fleet. In addition to this, we are looking at solar solutions for electricity use.
United Kingdom company law requires the directors to prepare financial statements for each financial year. Under that law, the directors have elected to prepare the group and parent company 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 group and parent company, and of the profit or loss of the group for that period.
In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and parent company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and parent company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and parent 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 group and parent company, and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
We have audited the financial statements of Radwell International - Europe Limited (the 'Parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2025 which comprise the group statement of comprehensive income, the Group statement of financial position, the company statement of financial position, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows 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 Group's and Parent Company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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.
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 specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud are detailed below.
Identifying and assessing risks related to irregularities:
We assessed the susceptibility of the Group and Parent Company’s financial statements to material misstatement and how fraud might occur, including through discussions with the directors, discussions within our audit team planning meeting, updating our record of internal controls and ensuring these controls operated as intended. We evaluated possible incentives and opportunities for fraudulent manipulation of the financial statements. We identified laws and regulations that are of significance in the context of the Group and Parent Company by discussions with directors and by updating our understanding of the sector in which the Group and Parent Company operates.
Laws and regulations of direct significance in the context of the Group and Parent Company include The Companies Act 2006 and UK Tax legislation.
Audit response to risks identified:
We considered the extent of compliance with these laws and regulations as part of our audit procedures on the related financial statement items including a review of Group and Parent Company financial statement disclosures. We reviewed the Parent Company's records of breaches of laws and regulations, and correspondence with relevant authorities to identify potential material misstatements arising. We discussed the Parent Company's policies and procedures for compliance with laws and regulations with members of management responsible for compliance.
During the planning meeting with the audit team, the engagement partner drew attention to the key areas which might involve non-compliance with laws and regulations or fraud. We enquired of management whether they were aware of any instances of non-compliance with laws and regulations or knowledge of any actual, suspected or alleged fraud. We addressed the risk of fraud through management override of controls by testing the appropriateness of journal entries and identifying any significant transactions that were unusual or outside the normal course of business. We assessed whether judgements made in making accounting estimates gave rise to a possible indication of management bias. At the completion stage of the audit, the engagement partner’s review included ensuring that the team had approached their work with appropriate professional scepticism and thus the capacity to identify non-compliance with laws and regulations and fraud.
As Group auditors, our assessment of matters relating to non-compliance with laws or regulations and fraud differed at group and component level according to their particular circumstances. Our communications with component auditors included a request to identify instances of non-compliance with laws and regulations and fraud that could give rise to a material misstatement of the Group financial statements in addition to our risk assessment.
There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
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 Parent 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 Parent 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 parent company and the Parent Company's members as a body, for our audit work, for this report, or for the opinions we have formed.
The statement of comprehensive income has been prepared on the basis that all operations are continuing operations.
As permitted by s408 Companies Act 2006, the company has not presented its own income statement and related notes. The company’s loss for the year was £147,061 (2024 - £11,184,850 profit).
Radwell International- Europe Limited (“the company”) is a private company limited by shares incorporated in England and Wales. The registered office and principal place of business is Unit D, Dalewood Road, Lymedale Business Park, Newcastle Under Lyme, Staffordshire, ST5 9QZ.
The group consists of Radwell International- Europe Limited and all of its subsidiaries.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
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 £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The 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 for parent company information presented within the consolidated financial statements:
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 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The consolidated group financial statements consist of the financial statements of the parent company Radwell International - Europe Limited together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 31 December 2025. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
At the time of approving the financial statements, the directors have a reasonable expectation that the group and parent company have adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
Revenue represents the amounts receivable from the repair and sale of electrical components, net of value added tax and trade discounts. Revenue is recognised when the repair service has been completed and control of the goods has transferred to the customer, which occurs upon delivery.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on delivery of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.
In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Where a reasonable and consistent basis of allocation can be identified, assets are allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in the income statement, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in the income statement, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's statement of financial position when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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, which include trade and other receivables, 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.
Financial assets are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in the income statement.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in the income statement.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group 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 group after deducting all of its liabilities.
Basic financial liabilities, including trade and other payables and loans from fellow group companies, 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 payables 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 payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group 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 group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or non-current assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation are included in the income statement for the period.
In the application of the group’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.
Inventory provisions include shrinkage, obsolescence and write-downs which take into account historical information related to sales trends and stock counts and represent the expected write-down between the estimated net realisable value and the original cost. Net realisable value represents the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution. The provision at the reporting date was £4,507,328 (2024 - £7,508,600).
Also during the year, the Group updated the basis on which it estimates provisions against slow‑moving and obsolete inventory. Under the previous policy, the Group made a full provision for all stock items received more than three years ago.
Management has now adopted a more refined approach, which applies varying provision rates based on the time elapsed since the item was last sold, rather than simply when it was originally received. This change reflects improved information about stock usage patterns and is considered to provide a more reliable estimate of the obsolescence of inventory.
This represents a change in accounting estimate under FRS 102. The change has been applied prospectively, and its impact on the financial statements for the year is as follows:
Decrease in stock provision: £3,001,272
Management considers the updated estimation methodology to provide a more accurate reflection of expected future realisable value. Future periods will reflect the revised estimation basis.
The directors assess the doubtful debt allowance at each reporting date. Key assumptions applied are the estimated debt recovery rates and the future market conditions that could affect recovery. The provision at the reporting date was £652,822 (2024 - £646,161).
The determination of the dilapidation provision involves significant judgement in assessing the extent of future obligations under lease agreements. Management has considered the condition of the leased properties, the terms of the lease contracts, and historical experience to estimate the costs required to restore the properties to their original state upon lease termination. Given the inherent uncertainty in estimating future costs and timing, this provision is subject to change based on updated assessments or changes in contractual obligations. The provision at the reporting date was £667,670 (2024 - £590,010).
An analysis of the group's revenue is as follows:
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2024 - 3).
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
OECD Pillar Two Global Minimum Tax
The OECD’s Pillar Two framework introduces a global minimum tax of 15% applicable to multinational groups with consolidated revenue exceeding €750 million. Legislation implementing the Pillar Two rules has been enacted or substantively enacted in several jurisdictions in which the Group operates, with effective dates commencing on or after 1 January 2024.
The Group falls within the scope of the Pillar Two rules and has undertaken an initial assessment of its exposure to top-up taxes under the Global Anti-Base Erosion (GloBE) regime. Based on this assessment, the Group expects to benefit from the transitional Country-by-Country Reporting (CbCR) safe harbour provisions, which apply for financial years 2024 to 2026. These provisions allow for simplified compliance and may result in a nil top-up tax in jurisdictions meeting specific criteria, including de minimis thresholds, simplified effective tax rate tests, or routine profits tests.
As a result, the Group does not anticipate any material exposure to Pillar Two top-up taxes for the year ended 31 December 2025. The Group will continue to monitor developments in local legislation and administrative guidance and reassess its position as necessary.
Details of the company's subsidiaries at 31 December 2025 are as follows:
Registered office addresses (all UK unless otherwise indicated):
After the balance sheet date, the Group acquired 100% of the share capital of a newly incorporated company in India, Radwell International India Private Limited.
The newly acquired subsidiary was incorporated on 16 March 2026 and its registered office is Dua Associates, 130/1, 2nd Floor, Ulsoor Road, Sivan Chetty Gardens, Bangalore North, Bangalore- 560042, Karnataka.
The Group also acquired 100% of the share capital of an existing company called IRS (Industrial Realization Services B.V, a company registered in the Netherlands, on 13 July 2026.
The newly acquired company's registered office is Peelterbaan 8, 6002 NK Weert, the Netherlands.
During the year, the Group recognised a write-off of £661,219 (2024: £3,483,596 write-off) in the profit and loss account relating to inventory provisions. This reflects management’s reassessment of the recoverability of certain stock items, which is in line with the Group’s stock provision accounting policy.
Also during the year, the Group updated the basis on which it estimates provisions against slow‑moving and obsolete inventory. Under the previous policy, the Group made a full provision for all stock items received more than three years ago.
Management has now adopted a more refined approach, which applies varying provision rates based on the time elapsed since the item was last sold, rather than simply when it was originally received. This change reflects improved information about stock usage patterns and is considered to provide a more reliable estimate of the obsolescence of inventory.
This represents a change in accounting estimate under FRS 102. The change has been applied prospectively, and its impact on the financial statements for the year is as follows:
Decrease in stock provision: £3,001,272
Management considers the updated estimation methodology to provide a more accurate reflection of expected future realisable value. Future periods will reflect the revised estimation basis.
During the year, the Group impaired the value of trade receivables and a debit totalling £nil (2024: £205,069) was recognised in the statement of comprehensive income.
Amounts owed by group undertakings are interest free and repayable on demand.
On the 21 March 2025 both the legal charge and the debenture held by National Westminster Bank PLC were satisfied. As at 31 December 2025 there were no securities outstanding.
Amounts owed to group undertakings are interest free and repayable on demand.
The returns and warranty provision represents management's best estimate of the company's expected returns and liability under warranties granted on products, based on past experience and industry averages for defective products.
Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
The deferred tax liability expected to reverse in the year ending 31 December 2025 is £105,288.
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
The share has attached to it full voting, dividend and capital distribution (including on winding up) rights. They do not confer any rights of redemption.
This capital contribution reserve was recognised on the acquisition of its subsidiary, where part of the consideration was shares, valued at £1,000,000, in the ultimate parent company.
Retained earnings represents accumulated comprehensive income for the year and prior periods less dividends paid.
Operating lease payments represent rentals payable by the company for its properties and certain plant and machinery.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
After the balance sheet date, the Group acquired 100% of the share capital of a newly incorporated company in India, Radwell International India Private Limited.
The newly acquired subsidiary was incorporated on 16 March 2026 and its registered office is Dua Associates, 130/1, 2nd Floor, Ulsoor Road, Sivan Chetty Gardens, Bangalore North, Bangalore- 560042, Karnataka.
The Group also acquired 100% of the share capital of an existing company called IRS (Industrial Realization Services) B.V, a company registered in the Netherlands, on 13 July 2026.
The newly acquired company's registered office is Peelterbaan 8, 6002 NK Weert, the Netherlands.
The Group paid a consideration of €6,000,000 for the company.
The remuneration of key management personnel is as follows: