REGISTERED NUMBER: 02271414

Strategic Report,

Report of the Directors and

Financial Statements

for the Year Ended 31 March 2026

for

Toray Advanced Composites UK Ltd

Page

Company Information

1

Strategic Report

2

Report of the Directors

5

Report of the Independent Auditors

8

Income Statement

12

Other Comprehensive Income

13

Balance Sheet

14

Statement of Changes in Equity

15

Notes to the Financial Statements

16

DIRECTORS:

Mr D J Bernard

Mr P D Smith

Dr J Nowacki

SECRETARY:

Mrs S Palmer

REGISTERED OFFICE:

Amber Drive

Langley Mill

Nottinghamshire

NG16 4BE

REGISTERED NUMBER:

02271414

AUDITORS:

Mabe Allen LLP

Chartered Accountants

Statutory Auditors

50 Osmaston Road

Derby

DE1 2HU

The directors present their strategic report for the year ended 31 March 2026.

REVIEW OF BUSINESS AND PRINCIPAL ACTIVITIES

The company is a wholly owned subsidiary of Toray Advanced Composites Holding B.V. and is ultimately 100% owned by Toray Industries Inc. of Japan and operates as part of its worldwide Advanced Composites Division.

The principal activity of the company during the year to 31 March 2026 was the development and production of advanced thermoset prepregs in fabric and unidirectional tape. There have not been any significant changes in the company's principal activities during the year under review.

The business continues to focus on strategic growth and increased market share, as well as its legal and environmental obligations.

The year under review saw a 74% increase in sales compared to the prior year. Our strategic targets were met and we increased share in the automotive industry. Demand in the space sector created a spike in the year that made up for a short fall in the past. The sales growth has been instrumental in offsetting the continued inflationary pressures on material, labour & energy costs.

The directors are not aware, at the date of this report, of any likely changes in the company's principal activities in the next year.

The company's key financial and other performance indicators during the year were as follows:

2026

2025

Change

£'000

£'000

%

Turnover

37,307

21,483

+74%

Operating profit

9,089

2,892

+214%

Profit/(loss) for the financial year

6,496

2,373

+174%

Loans

750

2,250

-67%

PRINCIPAL RISKS AND UNCERTAINTIES

The conflicts across the world continue to be a source for global concern. We continue to monitor the situation, and any potential future impact on supply chain and energy costs. The installation of solar panels, completed in March 2024, has helped to mitigate some of the risks and we continue to work on energy reduction projects, as well as working with our Toray colleagues on opportunities to limit the impact of this on the business.

Credit risk is managed by agreeing principal payment terms and credit limits in advance. Appropriate credit risk procedures are taken at all times and debts are insured. Where credit risk is considered too high, credit insurance is not available then cash in advance payments are considered.

The company has transactions (sales and purchases) in major foreign currencies and is therefore exposed to movements in foreign exchanges, although it tries to mitigate these risks by offsetting purchases in major currencies, or when appropriate, takes out currency contracts to manage the risk.

Having considered the above risks and uncertainties, the directors have a reasonable expectation that the company has adequate resources, given Toray group support, to continue operational existence for the foreseeable future. Thus, the directors continue to adopt a going concern basis of accounting in preparing the financial statements

SECTION 172(1) STATEMENT

There were no principal decisions, during the period. The Directors are aware of their responsibilities to act in good faith to promote the long-term success of the business and consider different stakeholder groups on decision making.

The Directors of the UK entity work within the corporate philosophy of our ultimate controlling parent, Toray Industries, Inc., Japan, (referred to in these accounts as the group). This philosophy calls for contributing to society through the creation of new value with innovative ideas, technologies, and products. This philosophy is reflected in our continuing commitment to research and development activities leading to the creation of new products and technologies that enhance the quality of life for people throughout the world. At the same time, the company has worked actively to improve the environment and fulfil our corporate and social responsibilities (CSR), including compliance with business ethics, laws and regulations. As part of our CSR commitment, we have made safety, accident prevention and environmental preservation top management priorities and have ISO 45001 and ISO 14001 accreditation.

Encouraging communication and cooperation with stakeholders including employees, customers, suppliers and other business partners as well as government and administrative agencies.

Employees - As well as improved communication with our employee's, we continue to support Toray's BEAR compliance and communication program. We engage our employees in the safety team, on a rota basis to ensure that we gain commitment to continuing to improve our safety culture.

Customers - Customers expect the highest quality products that meet their specifications. Understanding the needs of the customers is central to ensuring the long-term success of the company. Regular interaction with our sales and technical team ensures that we can work together to develop and or provide a product suitable to their requirements.

Suppliers - The business primarily engages with its suppliers through its supply chain and procurement teams. The business has a code of conduct for suppliers. In addition, the business complies with the Modern Slavery Act in respect of its supplier base. Management consistently review supplier payment behaviours.

OPERATIONS AND FUTURE PROSPECTS

The company continued to focus on building on our strong safety culture, servicing our customers, manufacturing strengths, preventative maintenance and dealing with cost pressures. In addition, we remain focused on the upside potential of developing markets looking for key benefits of using structural composite materials.

Strategy is constantly reviewed by the board in light of the group's performance and changing market conditions to ensure it remains appropriate to achieve the groups objectives.

The company has received in full the managerial, technical and support of its parent company through the acceptance of our Medium Term Plan.

The directors are confident that the business's strategy will continue to deliver the results that meet shareholders expectations in the years to come.

TRADING RESULTS

During period under review the company experienced a 74% increase in sales in comparison to the prior 12 months to March 2025, from £21.4 million to £37.3 million, resulting in an operating profit of £9.09 million (2025 : £2.89 million).

The profit for the year, before tax, was £8.88 million (2025 : £2.60 million). The total recognised profit was £6.49 million (2025 : £2.37 million).

In addition to financial measures, the director also monitors the business's operations with the objective of ensuring that health and safety is at the core of all working practises. In measuring the success of this, the directors review the level of reported incidents and monitors the training being undertaken by all relevant employees.

The balance sheet shows that the company's financial position is £11.9 million (2025 : £5.4 million). Reserves are now £8.9 million net positive (2025 : 2.40 million). The company continues to have the support of the ultimate parent company, Toray Industries, Inc. in Japan.

ON BEHALF OF THE BOARD:

Mr D J Bernard - Director

25 August 2026

The directors present their report with the financial statements of the company for the year ended 31 March 2026.

DIVIDENDS

The directors do not recommend the payment of a dividend (2025 : £nil).

RESEARCH AND DEVELOPMENT

The company continues to invest in research & development. The company's developments are co-ordinated with those of the Toray Advanced Composites group throughout the world. The directors recognised that R&D investment is essential for success in the medium to long-term future. In 2026 £239,228 was expensed in relation to research and development (2025 : £15,298).

FUTURE DEVELOPMENTS

Information regarding the company's likely future developments and strategic priorities is disclosed in the Strategic Report on pages 2 to 4.

DIRECTORS

Mr D J Bernard has held office during the whole of the period from 1 April 2025 to the date of this report.

Other changes in directors holding office are as follows:

Mr P D Smith - appointed 27 August 2025

Dr J Nowacki was appointed as a director after 31 March 2026 but prior to the date of this report.

GOING CONCERN

The company's business activities, together with factors likely to affect its future development, performance, its financial position, financial risk management objectives, details of financial instruments and its exposure to credit and cash flow risk are set out in the Business Review in the Strategic Report.

The company continues to have a range of customers across different geographical and market sectors and continues to work closely with its customers to develop its product range. As a consequence the directors believe that the company's forecasts and projections, taking into account possible changes in trading performance, show that the company should be able to operate within the level of its current facilities despite the uncertain economic outlook.

As shown on the Income Statement the company achieved a net profit of £6,496,451 during the year ended 31 March 2026. The company has retained a net asset position and is now in a stronger financial position. The company's assets exceed its total liabilities by £11,895,071 (2025 : £5,398,620, as seen on the Statement of Financial Position.

After making enquiries, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future and to provide support if required. Toray Industries Inc Revenue up to 31 March 2026 was 2,585 billion Yen with a core operating income of 141.9 billion Yen and cash equivalents of 265.3 billion Yen as at 31 March 2026. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.

The directors continue to monitor the impacts of US trade tariffs, energy costs, the conflicts around the world and supply chain issues to ensure that the company is prepared for any eventuality to remain competitive.

ENVIRONMENT, HEALTH AND SAFETY

The company operates under the principle of "Safety Over Output" and strives to achieve the group policy of Zero Accidents. The company Health & Safety management system is externally audited and accredited to ISO 45001.

The company operates under the principle of "Protect the Environment" and set out to minimize our environmental impact from design to despatch. The Company Environmental Management system is externally audited and accredited to ISO 14001.

EMPLOYEES

Details of the number of employees and the related costs can be found in note 6 to the financial statements.

The company participates in the Toray group's policies and practices to keep employees informed on matters relevant to them as employees locally and more widely through full participation in the Toray European Company Forum and other group seminars. The company gives full consideration to applications for employment from disabled persons where a handicapped or disabled person can adequately fulfil the requirements of the job. Where existing employees become disabled, it is the company's policy wherever practicable to provide continuing employment under normal terms and conditions and to provide training and career development and promotion to disabled employees wherever appropriate.

DIRECTORS' LIABILITY

The parent company has granted an indemnity to its directors against liability in respect of proceedings brought by third parties, subject to the conditions set out in the Companies Act 2006. Such qualifying third-party indemnity provision remains in force as at the date of approving the Report of the Directors.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), including Financial Reporting Standard 101 'Reduced Disclosure Framework'. Under company law the directors must not approve the financial statements unless they is 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;

- make judgements and accounting estimates that are reasonable and prudent;

- state whether applicable United Kingdom Accounting Standards, comprising FRS 101 have been followed, subject to any material departures disclosed and explained in the financial statements;

- 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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, Mabe Allen LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr D J Bernard - Director

25 August 2026

Opinion

We have audited the financial statements of Toray Advanced Composites UK Ltd (the 'company') for the year ended 31 March 2026 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 101 'Reduced Disclosure Framework' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 March 2026 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

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 or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

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 Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

-	adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page six, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Extent to which the audit was considered capable of detecting fraud

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:

- The nature of the industry and sector, control environment and business performance including targets for income and net profit;

- Results of our enquiries of management and the director about their own identification and assessment of the risks of irregularities;

- Any matters we identified having obtained and reviewed the company's documentation of their policies and procedures relating to:

- Identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance, including any related to it's operations, including health and safety, environmental considerations, and the General Data Protection Regulations or Bribery Act 2010.

- Detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;

- The internal controls to mitigate risks of fraud or non-compliance with laws and regulations;

- The matters discussed among the audit engagement team and including relevant internal tax specialists regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within the company for fraud and identified the greatest potential for fraud in the ability of management to manipulate revenue recognition. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.

We also obtained an understanding of the legal and regulatory frameworks that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the Companies Act 2006 and the Financial Reporting Standard 101.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate or to avoid a material penalty. These include The General Data Protection Regulations, the Bribery Act 2010 and Health and Safety policies set in accordance with British Standards Institution (BSI) guidelines.

Audit Response to Risks Identified

Our procedures to respond to risks identified above include the following:

- Reviewing the financial statements disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;

- Reviewing and challenging the assumptions and judgements used by management in their significant accounting estimates;

- Enquiring of management and the director concerning actual and potential litigation and claims;

- Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;

- In addressing the fraud risk in revenue recognition we have tested a sample of revenue recorded in the year through agreement to the relevant sales terms and conditions and bank statements. Additionally, at an analytical review level, we developed an expectation of the revenue with reference to our experience of the client and discussions on the recognition and volatility of revenue in the year, 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 rational of any significant transactions that are unusual or outside the normal course of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and 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. This 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 for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

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 a Report of the Auditors 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.

Neil Higgins FCCA (Senior Statutory Auditor)

for and on behalf of Mabe Allen LLP

Chartered Accountants

Statutory Auditors

50 Osmaston Road

Derby

DE1 2HU

25 August 2026

TURNOVER

4

37,307,479

21,483,296

Cost of sales

18,545,559

11,613,302

GROSS PROFIT

18,761,920

9,869,994

Administrative expenses

9,677,560

6,987,782

9,084,360

2,882,212

Other operating income

5

4,352

9,557

OPERATING PROFIT

9,088,712

2,891,769

Interest payable and similar expenses

9

201,269

295,918

PROFIT BEFORE TAXATION

10

8,887,443

2,595,851

Tax on profit

12

2,390,992

223,262

PROFIT FOR THE FINANCIAL YEAR

6,496,451

2,372,589

PROFIT FOR THE YEAR

6,496,451

2,372,589

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

6,496,451

2,372,589

FIXED ASSETS

Owned

Intangible assets

13

39,359

59,079

Tangible assets

14

3,873,589

2,949,846

Right-of-use

Tangible assets

14, 20

2,254,248

2,475,823

6,167,196

5,484,748

CURRENT ASSETS

Stocks

15

6,202,544

5,547,321

Debtors

16

9,448,827

3,686,021

Cash at bank

1,265,196

554,261

16,916,567

9,787,603

CREDITORS

Amounts falling due within one year

17

7,576,566

5,133,433

NET CURRENT ASSETS

9,340,001

4,654,170

TOTAL ASSETS LESS CURRENT LIABILITIES

15,507,197

10,138,918

CREDITORS

Amounts falling due after more than one year

18

(2,822,403

)

(4,517,036

)

PROVISIONS FOR LIABILITIES

21

(789,723

)

(223,262

)

NET ASSETS

11,895,071

5,398,620

CAPITAL AND RESERVES

Called up share capital

22

102

102

Share premium

23

2,999,998

2,999,998

Retained earnings

23

8,894,971

2,398,520

SHAREHOLDERS' FUNDS

11,895,071

5,398,620

The financial statements were approved by the Board of Directors and authorised for issue on 25 August 2026 and were signed on its behalf by:

Mr D J Bernard - Director

Called up

share

Retained

Share

Total

capital

earnings

premium

equity

£

£

£

£

Balance at 1 April 2024

102

25,931

2,999,998

3,026,031

Changes in equity

Total comprehensive income

-

2,372,589

-

2,372,589

Balance at 31 March 2025

102

2,398,520

2,999,998

5,398,620

Changes in equity

Total comprehensive income

-

6,496,451

-

6,496,451

Balance at 31 March 2026

102

8,894,971

2,999,998

11,895,071

1.	STATUTORY INFORMATION

Toray Advanced Composites UK Ltd (the "company") is a private company limited by shares and incorporated and domiciled in England and Wales. The registered number is 2271414 and the registered address is Amber Drive, Langley Mill, Nottinghamshire, NG16 4BE.

These financial statements were prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (FRS 101) and in accordance with applicable accounting standards.

The company's financial statements are presented in Sterling to the nearest £.

The principal accounting policies adopted by the company are set out in note 2.

2.	ACCOUNTING POLICIES

Basis of preparation

The financial statements of the company have been prepared in accordance with Financial Reporting Standard 101, 'Reduced Disclosure Framework' (FRS 101). FRS 101 sets out a reduced disclosure framework for a 'qualifying entity' as defined by the standard which addresses the financial reporting requirements and disclosure exemptions in the individual financial statement of qualifying entities that otherwise apply the recognition, measurement and disclosure requirements of EU-adopted IFRS. The financial statements have been prepared on a going concern basis under the historical cost convention and in accordance with the Companies Act 2006.

The company is a qualifying entity for the purposes of FRS 101. Note 23 gives details of the company's ultimate parent undertaking and from where it's consolidated financial statements have been prepared in accordance with IFRS may be obtained.

The preparation of the financial statements in conformity with FRS 101 requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the company's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed later in this note.

The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 101 "Reduced Disclosure Framework":

•

the requirements of IFRS 7 Financial Instruments: Disclosures;

•

the requirements of paragraphs 91 to 99 of IFRS 13 Fair Value Measurement;

•

the requirements of paragraph 52 of IFRS 16 Leases;

the requirements of paragraph 58 of IFRS 16;

•

the requirements of the second sentence of paragraph 110 and paragraphs 113(a), 114, 115, 118, 119(a) to (c), 120 to 127 and 129 of IFRS 15 Revenue from Contracts with Customers;

•

the requirement in paragraph 38 of IAS 1 Presentation of Financial Statements to present comparative information in respect of:

-

paragraphs 53(a), (h) and (j) of IFRS 16;

-

paragraph 79(a)(iv) of IAS 1;

-

paragraph 73(e) of IAS 16 Property, Plant and Equipment; and

-

paragraph 118(e) of IAS 38 Intangible Assets;

•

the requirements of

-

paragraphs 1 to 44E, 44H(b)(ii) and 45 to 63 of IAS 7 Statement of Cash Flows; and

-

paragraphs 44F, 44G, 44H(a), 44H(b)(i), 44H(b)(iii) and 44H(c) of IAS 7;

•

the requirements of paragraphs 30 and 31 of IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors;

•

the requirements of paragraphs 17 and 18A of IAS 24 Related Party Disclosures;

•

the requirements in IAS 24 Related Party Disclosures to disclose related party transactions entered into between two or more members of a group;

Going concern

The company's business activities, together with factors likely to affect its future development, performance, its financial position, financial risk management objectives, details of financial instruments and its exposure to credit and cash flow risk are set out in the Business Review in the Strategic Report.

The company continues to have a range of customers across different geographical and market sectors and continues to work closely with its customers to develop its product range. As a consequence the directors believe that the company's forecasts and projections, taking into account possible changes in trading performance, show that the company should be able to operate within the level of its current facilities despite the uncertain economic outlook.

As shown on the Income Statement the company achieved a net profit of £6,496,451 during the year ended 31 March 2026. The company has retained a net asset position and is now in a stronger financial position. The company's assets exceed its total liabilities by £11,895,071 (2025 : £5,398,620, as seen on the Statement of Financial Position.

After making enquiries, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future and to provide support if required. Toray Industries Inc Revenue up to 31 March 2026 was 2,585 billion Yen with a core operating income of 141.9 billion Yen and cash equivalents of 265.3 billion Yen as at 31 March 2026. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.

The directors continue to monitor the impacts of US trade tariffs, energy costs, the conflicts around the world and supply chain issues to ensure that the company is prepared for any eventuality to remain competitive.

Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods and services provided in the normal course of business, net of discounts, VAT and other sales-related taxes.

Sale of goods

Revenue from the sale of goods is recognised when performance obligations are satisfied as set out below:

-

the company has transferred to the buyer the significant risks and rewards of ownership of the goods;

-

the company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold.

-

the amount of revenue can be measured reliably.

-

it is possible 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.

Government Grants

Government grants are recognised at fair value as other income in the income statement when there is reasonable assurance that the conditions associated with the grant have been complied with and the grants will be received. Grants compensating for expenses incurred are recognised in the income statement on a systematic basis in the same period in which the expenses are incurred.

Government grants relating to property, plant and equipment are treated as deferred income and released to the profit and loss over the expected useful lives of the assets concerned

Amortisation of intangible assets

Amortisation is provided on all intangible fixed assets at rates calculated to write off the cost, less estimated residual value based on prices prevailing at the date of acquisition of each asset evenly over its expected useful life, as follows:

Licences

3 - 5 Years

Tangible fixed assets

Tangible fixed assets are stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred.

Depreciation is provided at the following annual rates in order to write off the cost less estimated residual value of each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter

Leasehold property (Buildings)

15 years

Plant and Machinery

3 - 10 years

Fixtures and fittings

3 - 20 years

Motor vehicles

2 - 9 years

Equipment

5 - 6 years

Impairment of tangible assets

Tangible assets are reviewed for impairment as and when indications of such impairment exist. When required, impairment reviews based on discounted forecast cash flows or estimated realisable values of assets are performed with any resulting shortfall charged in arriving at operating loss.

Assets in the course of construction

Assets in the course of construction are stated at cost. These assets are not depreciated until they are available for use and are reviewed for impairment at each reporting date.

Financial instruments

Financial assets

Initial recognition and measurement

Financial assets are classified as financial assets at fair value through profit and loss, loans and receivables, held-to-maturity investments, available-for-sale financial assets, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. The company determines the classification of its financial assets at initial recognition.

Loans and receivables

Receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are initially recognised at fair value and subsequently measured at amortised cost using the effective interest (EIR) method, less impairment. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are integral part of the EIR. The EIR amortisation is included in finance revenue in the income statement in other operating expenses.

Impairment of financial assets

The company recognises an allowance for expected credit losses ("ECLs") for all debt instruments not held at fair value through profit or loss. ECLs are recognised in two stages:

-

for credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (a 12-month ECL);

-

for those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).

Impairment provisions are recognised when there is objective evidence (such as significant financial difficulties on the part of the counter-party or default or significant delay in payment) that the company will be unable to collect all of the amounts due under the terms receivable, the amount of such a provision being the difference between the net carrying amount and the present value of the future expected cash flows associated with the impaired receivable. For trade receivables, which are reported net, such provisions are recorded in a separate allowance account with the loss being recognised within administrative expenses in the Statement of comprehensive income. On confirmation that the trade receivable will not be collected, the gross carrying value of the asset is written off against associated provision.

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified as financial liabilities at fair value through profit or loss, loans and borrowings, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. The company determines the classification of its financial liabilities at initial recognition. All financial liabilities are recognised initially at fair value and in the case of loans and borrowings, plus directly attributable transaction costs.

Stocks

Stocks are stated at the lower of cost and net realisable value. Cost includes all costs incurred in bringing each product to its present location and condition, as follows:

Raw materials, consumables, and goods for resale

-

purchase cost on a first-in, first-out basis

Work in progress and finished goods

-

cost of direct materials and labour plus attributable overheads based on a normal level of activity.

Net realisable value is based on estimated selling price less any further costs expected to be incurred to completion and disposal

Current tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the income statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

The current tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the company operates and generates taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions, where appropriate, on the basis of amounts expected to be paid to the tax authorities.

Deferred taxation

Deferred tax is recognised on all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements, with the following exceptions:

- When the deferred tax liability arises from the initial recognition of good will or an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor the taxable profit or loss.

Deferred income tax assets are recognised only to the extent that it is probable that taxable profit will be available against which the deductible differences, carried forward tax credits or losses can be relieved.

The carrying amount of deferred tax assets is reviewed at each balance sheet 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 measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which timing differences reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date. Deferred tax is charged or credited to the income statement, except where it relates to items charged or credited in other comprehensive income, in which case the deferred tax is also dealt with in other comprehensive income.

Research and development

Research and development expenditure is written off in the year in which it is incurred but claims are made for eligible expenditure and treated as other operating expenses

Functional currency

The functional currency of the company is pounds sterling on the basis that the trading largely consists of sterling transactions and the main site of the business is situated in the United Kingdom.

Foreign currency translation

The company's financial statements are presented in sterling, which is the company's functional currency.

Transactions in foreign currencies are initially recorded at the prevailing rate of exchange ruling at the date of the transaction.

Monetary assets and liabilities denominated in foreign currencies are retranslated at the functional currency rate of exchange ruling at the balance sheet date. All differences are taken to the Income Statement.

Leases

Applying IFRS16 has resulted in right-of-use assets totalling £2,254,248 (2025 : £2,475,823), which is comprised of buildings, forklift trucks, office / plant equipment and motor vehicles. Right-of-use assets are depreciated to nil over the lease term. At 31 March 2026, current lease liabilities were £363,086 (2025 : £312,211) and non-current being £2,072,403 (2025 : £2,267,036). Calculation of the lease liabilities during year to 31 March 2026 is based on the prevailing borrowing rates at the time of the lease (between 4.67% and 5.39%), resulting in £118,314 (2025 :£125,299) interest charge contained in the income statement.

The Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor. Leased assets may not be used as security for borrowing purposes.

The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is generally the case for leases in the company, the lessee's incremental borrowing rate is used, being the rate that the individual lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, security and conditions.

The company is exposed to potential future increases in variable lease payments based on an index or rate, which are not included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take effect, the lease liability is reassessed and adjusted against the right-of-use asset.

Lease payments are allocated between principal and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

Right-of-use assets are measured at cost comprising the following:

-

the amount of the initial measurement of lease liability.

-

any lease payments made at or before the commencement date less any lease incentives received; and

-

any initial direct costs.

Right-of-use assets are generally depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis. If the company is reasonably certain to exercise a purchase option, the right-of-use asset is depreciated over the underlying asset's useful life.

Payments associated with short-term leases of equipment and vehicles and all leases of low-value assets are recognised on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less.

Information about critical accounting judgements in the application of lease accounting is disclosed in note 3.

Employee benefit costs

The company provides a range of benefits to employees, including annual bonus arrangements, paid

holiday arrangements and defined contribution pension plans.

i. Short term benefits

Short term benefits, including holiday pay and other similar non-monetary benefits, are recognised as an expense in the period in which the service is received.

ii. Defined contribution pension plans.

The company operated a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further payment obligations. The contributions are recognised as an expense when they are due. Amounts not paid are shown in accruals in the balance sheet. The assets of the plan are held separately from the company in independently administered funds.

Consolidation

The company is a parent of a dormant subsidiary, Amber Composites Limited. The subsidiary entity is dormant it can be excluded from consolidation because it is not material for the purpose of giving a true and fair view.

Therefore, the company is exempt, by virtue of section 402 of the Companies Act 2006, from the requirement to prepare consolidated financial statements.

Derivatives

The company uses derivative financial instruments such as foreign currency contracts to hedge its risks associated with foreign currency fluctuations. Derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at fair value at each balance sheet date. Derivatives are carried as assets when the fair value is positive and as liabilities when fair value is negative.

The fair value of forward currency contracts is calculated by reference to current forward exchange rates for contracts with similar maturity profiles. The company designates derivatives of foreign currency risk of firm commitments as cash flow hedges.

Where hedge accounting is desired, the hedging relationship is formally designated and documented at its inception. This documentation identifies the risk management objectives, strategy for undertaking the hedge, the hedged instrument, the hedged item or transaction, the nature of the risk being hedged, and how effectiveness will be measured throughout its duration. At inception of the hedge and on an ongoing basis, the company documents whether the hedging instrument is highly effective in offsetting changes in fair values or cash flows of the hedged item.

The company has not applied hedge accounting, and all derivatives are measured at fair value through profit and loss.

Cash flow hedges

The company classifies hedges as cash flow hedges when hedging exposure to variability in cash flows that is either attributable to a particular risk associated with a recognised asset or liability, or highly probable forecast transaction.

For cash flow hedges, the effective portion of the gain or loss is recognised directly in other comprehensive income, while the ineffective portion is recognised in profit or loss. Amounts taken to other comprehensive income are transferred to the income statement (included in the "other gains and losses" line) when the hedged transaction affects profit or loss, for example when a forecast sale or purchase occurs.

3.	SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Critical accounting estimates and assumptions

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. The following judgements have had the most significant effect on amounts recognised in the financial statements:-

Useful economic lives of property, plant and equipment

The annual depreciation charge for property, plant and equipment is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and the physical condition of the assets. See note 13 for the carrying amount of the property plant and equipment and the accounting policy note for the useful economic lives for each class of assets.

As indicated in note 2 the estimated useful lives of items of property, plant and equipment range between 2 - 50 years. However, the actual useful lives might be shorter or longer depending on technological innovations and other factors.

Lease accounting

In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated).

For leases of buildings and equipment, the following factors are normally the most relevant:

- If there are significant penalties to terminate (or not extend), the company is typically reasonably certain to extend (or not terminate).

- If any leasehold improvements are expected to have a significant remaining value, the company is typically reasonably certain to extend (or not terminate).

- Otherwise, the company considers other factors including historical lease durations and the costs and business disruption required to replace the leased asset.

Most extension options in vehicle leases have not been included in the lease liability because the company could replace the assets without significant cost or business disruption.

The lease term is reassessed if an option is actually exercised (or not exercised) or the company becomes obliged to exercise (or not exercise) it. The assessment of reasonable certainty is only revised if a significant event or a significant change in circumstances occurs, which affects this assessment, and that is within the control of the lessee.

Stock provision

The determination of the cost of stock is a significant area of estimation. The key areas of estimation are: