The Directors present the strategic report for the year ended 31 December 2025.

Details of the company's performance for the financial year are set out in detail on page 9.

Turnover increased year on year from £14,431,518 to £14,463,395 representing a 0.2% increase

Gross margin decreased slightly from 47.9% to 46.7%, reflecting changes in the sales mix, partially offset by price increases.

The company balance sheet on page 10 of the financial statements shows the company's net asset position of £8,012,766 at the year end, an increase from £7,151,953 mainly driven by retained profits for the year.

Profit after tax increased from £708,878 to £860,813 due to increased revenue and a stable gross margin percentage.

The cash balance has decreased from £2,871,107 to £1,264,768 reflecting the transfer of surplus funds into the Group cash pool to support wider Group expansion plans.

The Directors and management team continually monitor the key risks facing the company together with assessing the controls used for managing these risks. The principal risks and uncertainties facing the company are as follows:

Customer relationships - The company sells goods and services to the NHS. This government department, like many others, is under financial pressure and subject to budget constraints. Whilst it remains a stable business environment to operate in, a large portion of the company's income is reliant on NHS business. There is, however, no notable reduction in trade with NHS bodies, nor is there any such reduction forecast in coming years.

Change of ownership - The recent change of ownership may create some uncertainty as the business adjusts to new structures and priorities. The Board is monitoring the transition to ensure continuity of operations and to manage any potential risks arising during this period.

Supplier relationships - As a distribution company, the relationship with its manufacturing partners is a key factor for continued success. Expiry of these agreements without renewal is a risk, as is the acquisition of the manufacturer.

Product portfolio - The company acknowledges that the diagnostic reagent and instrumentation market is rapidly evolving through scientific and technological advances. It is key for the company to adapt to these changes in the market. The company seeks to provide a market leading service to customers by partnering with key suppliers, using the latest technologies and innovative emerging products.

Foreign trade - Trading with overseas suppliers exposes the company to the risk of adverse movements in foreign currency, as well as potential changes to tariffs and VAT, following Brexit, both impacting profit. The company mitigates this risk by close control and management of the cash and currency positions.

Key personnel - A potential risk is the loss of key personnel in the company. Management seeks to ensure that key personnel are appropriately remunerated to ensure that good performance is recognised.

Cybersecurity - Unexpected events such as failures of IT systems or the increasing threat of targeted cyber-attacks could disrupt the Company’s operations from any of its sites or lead to a loss of data. The Company continues to place reliance on third-party cloud-hosted applications, which provide cost-effective services with significant redundancies and disaster prevention and recovery strategies.

The Company has in place disaster recovery plans which are periodically tested and third-party specialists are used to assess any potential vulnerabilities in the Company’s systems. The Company ensures that all software and systems are regularly updated to latest software versions and firmware updates. Its cyber security plans are reviewed on a regular basis and recently upgraded security access levels have been established.

Loss of facilities – Should the Company’s facilities become inaccessible through damage caused by fire, flooding or theft, the ability to receive goods from suppliers and carry on meeting customer delivery timelines may be affected depending on the severity of the incident. The Company has established business continuity plans in place for each location which are regularly reviewed and tested. Resilience exists between sites so that certain operations could be quickly transferred from one facility to another where appropriate. Health and safety procedures and policies exist for each site with routine checks on facilities, equipment and infrastructure. The Company also maintains adequate insurance to cover any business damage or interruption.

The company manages its business using the following indicators:-

• Sales – the performance of the core product portfolio, discussed on page 1

• Gross margin – there has been a decrease from 47.9% in 2024 to 46.7%

• Profit after tax - there has been an increase from £708,878 in 2024 to £860,813 in 2025

The directors aim to maintain the focus on meeting customer demands and requirements and identifying opportunities to expand its product portfolio and continue sales growth.

At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The Directors have assessed the continued impact of challenging macro-economic factors on the business, preparing budgets and cash flow forecasts to determine its ability to meet debts as and when they fall due. In preparing these forecasts, the Directors have considered the current and future economic conditions that are expected to prevail over the period. The forecasts also include assumptions regarding the timing of expected cashflows in the future.

Based on the analysis performed management concluded that the company has adequate financial resources to continue operating as a going concern for a period of at least 12 months from the date of approval of these financial statements, the directors of Launch Diagnostics Limited therefore consider it appropriate to prepare the accounts on a going concern basis.

The forecasts prepared by management include growth in revenue from 2025 to 2026 and 2027 from new and existing contracts. The company expects to maintain a profit position and generate positive cashflows which will allow the company to focus on strategy into the longer term. Management has also modelled a downside scenario assuming no revenue growth in 2027 and this shows a continued profit position with positive cashflows.

Based on the analysis performed together with the available cashflows, the directors assess the company will have sufficient funds to meet its liabilities as they fall due.

As a result of this assessment, the Directors have adopted the going concern basis of accounting for the preparation of these financial statements.

The directors are mindful of their duty under Section 172 of the Companies Act 2006 to promote the success of the company for the benefit of its members as a whole. In fulfilling this duty during the financial year, the board has considered the interests of stakeholders and the broader impact of its decisions.

Key considerations included:

• Employees: The board prioritised employee engagement, wellbeing, and development. Regular communication channels were maintained to ensure staff feedback informed decision-making.

• Stakeholder Relationships: Constructive relationships with customers, suppliers, and other stakeholders were supported through transparent communication and collaborative practices.

• Community and Environment: Environmental sustainability and social responsibility remained integral to the company’s strategy. Initiatives aimed at reducing environmental impact and supporting local communities were progressed.

• Long-Term Decision Making: Strategic decisions were made with a view to long-term value creation, balancing short-term performance with sustainable growth.

• Business Conduct: The company upheld high standards of governance and ethical behaviour, with policies and procedures in place to ensure compliance and accountability.

• Shareholder Interests: Shareholders were kept informed through regular updates, and their views were considered in board discussions and strategic planning.

The board recognises that effective stakeholder engagement is essential to long-term success and continues to embed these principles into its governance and operations.

On behalf of the board

The Directors present their report and financial statements for the year ended 31 December 2025.

The company's principal activity is to provide diagnostic reagents and hospital laboratory instrumentation to medical institutions in the UK (including the National Health Service) and to the wider European market.

The company acts as a full service distributor offering comprehensive support for both diagnostic reagents and instruments.

The results for the year are set out on page 9.

Ordinary dividends were paid amounting to £nil (2024: £4,502,259). The directors do not recommend payment of a final dividend.

The Directors who held office during the year and up to the date of signature of the financial statements were as follows:

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

Saffery LLP were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, have expressed their willingness to continue in office.

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law, the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period.

In preparing these financial statements, the directors are required to:

• select suitable accounting policies and then apply them consistently;

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

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

We have audited the financial statements of Launch Diagnostics Limited (the 'company') for the year ended 31 December 2025 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

• give a true and fair view of the state of the company's affairs as at 31 December 2025 and of its profit for the year then ended;

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's 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 other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

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 period for which the financial statements are prepared is consistent with the financial statements; and

• the Strategic Report and the Directors' Report has been prepared in accordance with the applicable legal requirements.

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

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

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

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

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

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

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

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

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

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 financial statement disclosures. We reviewed the company's records of breaches of laws and regulations, minutes of meetings and correspondence with relevant authorities to identify potential material misstatements arising. We discussed the 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.

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: www.frc.org.uk/auditors responsibilities. This description forms part of our auditor’s report.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

The Income statement has been prepared on the basis that all operations are continuing operations.

The notes on pages 12 to 25 form part of these financial statements.

The notes on pages 12 to 25 form part of these financial statements.

The notes on pages 12 to 25 form part of these financial statements.

Launch Diagnostics Limited is a private company limited by shares incorporated in England and Wales. The registered office is Lakeview West, Crossways Business Park, Galleon Boulevard, Dartford, Kent, DA2 6QE.

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, modified to include, where applicable, the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

• Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

• Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

• Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;

• Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

The financial statements of the company for the year to 31 December 2024 and the period thereafter to 24 March 2025 were consolidated in the financial statements of Avacta Group Plc. These consolidated financial statements are available from its registered office, Scale Space, White City Imperial College Campus, 58 Wood Lane, London W12 7RZ.

The financial statements of the company for the year ended 31 December 2025 are consolidated in the financial statements of Launch Diagnostics Holdings Limited. These consolidated financial statements are available from its registered office, Lakeview West Crossways Business Park, Galleon Boulevard, Dartford, Kent, England, DA2 6QE.

At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Ttruehe Directors have assessed the continued impact of challenging macro-economic factors on the business, preparing budgets and cash flow forecasts to determine its ability to meet debts as and when they fall due. In preparing these forecasts, the Directors have considered the current and future economic conditions that are expected to prevail over the period. The forecasts also include assumptions regarding the timing of expected cashflows in the future. As a result of this assessment, the Directors have adopted the going concern basis of accounting for the preparation of these financial statements.

Turnover represents amounts receivable for goods and services net of VAT and trade discounts, and is wholly derived in the United Kingdom and the European Union. Turnover is recognised on an accruals basis.

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 dispatch 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.

Income arising from the leasing of diagnostic instruments to customers is recognised as revenue on a straight‑line basis over the lease term, as this activity forms part of the company’s ordinary trading operations.

Intangible assets relate to software acquired by the Company and are measured at cost less accumulated amortisation and any accumulated impairment losses.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

At each reporting period end date, the company 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.

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 profit or loss, 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 profit or loss, 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.

Stocks are stated at the lower of cost and estimated selling price less costs to sell, which is equivalent to net realisable value.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include debtors, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Trade debtors, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as 'loans and receivables'. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment.

Interest is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial. The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument to the net carrying amount on initial recognition.

Financial assets, other than those held at fair value through profit and loss, 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 profit or loss.

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 profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities, including debt instruments that do not meet the definition of a basic financial instrument, are measured at fair value through profit or loss.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

The 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 profit and loss account 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 company’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.

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

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 fixed assets.

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.

Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted using the Black Scholes model. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. The corresponding credit is recognised within other reserves as a capital contribution where the awards are granted by a parent undertaking and the company has no obligation to settle the awards.

Leases are classified as hire purchases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

Assets held under hire purchase agreements are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a hire purchase obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to the profit and loss account so as to produce a constant periodic rate of interest on the remaining balance of the liability.

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 leases asset are consumed.

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

There are no estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities.

The whole of the turnover is attributable to the company's principal activity.

The average monthly number of persons (including directors) employed by the 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 2 (2024 - 0).

The remuneration of the highest paid director during the year was £143,777 (2024: £nil).

The actual charge/(credit) 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:

Dividends totalling £nil (2024: £4,502,259) were voted and settled in the year in respect of shares held by the company's shareholder.

Short term assets include amounts in respect of assets held on hire purchase (and leased to customers) with a net book value of £34,151 (2024: £169,420). The depreciation charge for the year in relation to these amounted to £135,269 (2024: £190,187).

Amounts due from group undertakings are unsecured and repayable on demand. The 2025 balance comprises both interest‑free amounts and amounts accruing interest at Bank of England base rate plus 3%. The 2024 balance relates to cash held by Avacta Group Plc, the previous ultimate controlling party, in a high interest account, on behalf of Launch Diagnostics Limited.

Net obligations under hire purchase contracts are secured by fixed charges on the assets concerned.

In the previous financial year, the company recognised a dilapidations provision in respect of the lease. Following a review management has aligned the recognition of a provision with the remaining lease term.

Deferred tax assets and liabilities are offset where the 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 set out above is expected to reverse in the foreseeable future and relates to accelerated capital allowances and tax losses that are expected to mature within the same period.

The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund for the year. The outstanding pension liability at the year end was £20,597 (2024: £nil).

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

The company has taken advantage of the exemption to disclose related party transactions with companies that are wholly owned within the group. The balances outstanding at the year end are disclosed in Note 13.

The immediate parent company is Launch Diagnostics Holdings Limited. At the year ended 31 December 2025, the ultimate controlling party was Duomed Belgium NV, which is a subsidiary of Palex Healthcare Group S.L.U.

Launch Diagnostics Holdings Limited prepares consolidated financial statements and these are publicly available at Companies House or from its registered office: Lakeview West Crossways Business Park, Galleon Boulevard, Dartford, Kent, England, DA2 6QE.