REGISTERED NUMBER: 07810671 (England and Wales)

GROUP STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED

31ST DECEMBER 2025

FOR

ESC SPINNAKER LTD

Page

Company information

1

Group strategic report

2

Report of the directors

4

Report of the independent auditors

6

Consolidated income statement

10

Consolidated other comprehensive income

11

Consolidated balance sheet

12

Company balance sheet

14

Consolidated statement of changes in equity

15

Company statement of changes in equity

16

Consolidated cash flow statement

18

Notes to the consolidated cash flow statement

19

Notes to the consolidated financial statements

21

Directors:

B Freeman

R Freeman

A Freeman

Registered office:

Unit 4a Davy Way

Gateway 12 Business Park

Gloucester

GL2 2BY

Registered number:

07810671 (England and Wales)

The directors present their strategic report of the company and the group for the year ended 31st December 2025.

Review of business

The principal activity of the company is the sale of engineering supplies, industrial coatings and spray equipment.

Results & performance

The directors are pleased with the Group’s performance for the year ended 31 December 2025 and expect the business to continue these activities for the foreseeable future.

During the year, the Group achieved turnover of £15.7m, compared with £14.5m in the prior year, representing an increase of 8.3%. This growth has been achieved organically, as the Group continues to execute its strategy of expanding both its customer base and the quality of its customer relationships. Trading conditions became more challenging as the year progressed, reflecting wider pressures within the construction industry.

Despite these headwinds, the Group improved its gross profit margin to 17.7%, compared with 16.7% in 2024. Administrative expenses were tightly controlled, and other operating income was maximised where possible.

As a result, profitability increased with profit rising from £695k in 2024 to £786k in 2025.

The Group has maintained a strong balance sheet, with net current assets of £1.9m (2024: £1.85m) and total net assets of £2.3m (2024: £2.2m).

The Group continues to progress its growth strategy and is planning the acquisition of a complementary business in early 2026.

Market & economic environment

Trading during the year was influenced by increasingly challenging economic conditions, including high interest rates, persistent inflation, labour shortages and an ongoing skills gap. Market conditions were mixed, with increased public sector investment offset by a slowdown in private sector activity.

Despite this environment, the Group continued to grow, supported by strong relationships with existing customers and success in acquiring new business.

Principal risks & uncertainties

The directors recognise a number of key risks and uncertainties that could impact future performance:

- Macroeconomic conditions: Prolonged inflation and reduced consumer confidence, potentially exacerbated by geopolitical tensions, may affect demand.

- Competition: Pressure from established competitors and new market entrants could impact margins.

- Operational risks: Dependence on key personnel, rising transport and fuel costs, and supply chain reliability.

- Regulatory changes: Future changes in policy or taxation may influence trading conditions.

The Group continues to monitor these risks closely and has implemented mitigation strategies, including maintaining a diversified customer base, investing in systems and people, and applying prudent financial management.

Key performance indicators

The Board monitors performance using a range of key performance indicators (KPIs), including:

- Revenue growth (current year: £15.7m, an increase of 8.3%)

- OTIF (on-time, in-full deliveries)

- Gross profit margin (%)

- EBITDA / operating profit margin (%)

- Customer retention and new customer acquisition

- Staff turnover and engagement

- Identification and development of growth opportunities

These KPIs demonstrate steady progress against the Group's strategic objectives.

Future outlook & strategy

Looking ahead, the Group remains focused on:

- Expanding market share through investment in sales systems, personnel, marketing support, product innovation and product range expansion

- Enhancing customer experience and retention through improved UK-wide service capability and leveraging in-house expertise

- Separating ‘Capital Sales’ function to its own department to maximise current Pipeline of Opportunities

- Building organisational capability through staff development and cultural initiatives

- Maintaining disciplined financial management to support sustainable growth

- Pursuing future acquisition opportunities

While the wider economic environment remains uncertain, the directors are confident that the Group is well positioned to deliver continued growth and long-term shareholder value, supported by its expansion plans.

On behalf of the board:

B Freeman - Director

21st July 2026

The directors present their report with the financial statements of the company and the group for the year ended 31st December 2025.

Dividends

Interim dividends of £477,500 in various instalments were paid during the year.

The directors recommend that no final dividend be paid.

The total distribution of dividends for the year ended 31st December 2025 will be £477,500.

Directors

The directors shown below have held office during the whole of the period from 1st January 2025 to the date of this report.

B Freeman

R Freeman

Other changes in directors holding office are as follows:

A Freeman - appointed 19th November 2025

Statement of directors' responsibilities

The directors are responsible for preparing the Group 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). 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 the group and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

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

-	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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group 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 group's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

Auditors

The auditors, Chris Duckett (Audit) Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

On behalf of the board:

B Freeman - Director

21st July 2026

Opinion

We have audited the financial statements of ESC Spinnaker Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31st December 2025 which comprise the Consolidated income statement, Consolidated other comprehensive income, Consolidated balance sheet, Company balance sheet, Consolidated statement of changes in equity, Company statement of changes in equity, Consolidated cash flow statement and Notes to the consolidated cash flow statement, 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 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 group's and of the parent company affairs as at 31st December 2025 and of the group's 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 group 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 group's and the parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

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

Other information

The directors are responsible for the other information. The other information comprises the information in the Group 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 Group 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 Group 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 group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

-	the parent company 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 four, 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 group's and the parent 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 group or the parent 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.

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

-

the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

-

we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the industrial sector;

-

we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety legislation;

-

we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and

-

identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

-

making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud;

-

considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations; and

-

understanding the design of the company's remuneration policies.

To address the risk of fraud through management bias and override of controls, we:

-

performed analytical procedures to identify any unusual or unexpected relationships;

-

tested journal entries to identify unusual transactions;

-

assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and

-

investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

-

agreeing financial statement disclosures to underlying supporting documentation;

-

reading the minutes of meetings of those charged with governance;

-

enquiring of management as to actual and potential litigation and claims; and

-

reviewing correspondence with HMRC, relevant regulators and the company's legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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.

Chris Duckett (Senior Statutory Auditor)

for and on behalf of Chris Duckett (Audit) Limited

Chartered Accountants & Statutory Auditors

Network House

Thorn Office Centre

Rotherwas

Hereford

HR2 6JT

21st July 2026

Turnover

15,690,309

14,486,266

Cost of sales

12,919,455

12,069,818

Gross profit

2,770,854

2,416,448

Administrative expenses

1,976,122

1,687,075

794,732

729,373

Other operating income

32,681

13,172

Operating profit

5

827,413

742,545

Interest receivable & similar income

1,743

447

829,156

742,992

Interest payable & similar expenses

6

43,300

48,162

Profit before taxation

785,856

694,830

Tax on profit

7

201,788

130,870

Profit for the financial year

584,068

563,960

Profit attributable to:

Owners of the parent

576,746

556,723

Non-controlling interests

7,322

7,237

584,068

563,960

Profit for the year

584,068

563,960

Other comprehensive income

Purchase of own shares

20

(200,000

)

Transfer to capital redemption reserve

-

50,000

Income tax relating to components of other comprehensive income

-

-

Other comprehensive income for the year, net of income tax

20

(150,000

)

Total comprehensive income for the year

584,088

413,960

Total comprehensive income attributable to:

Owners of the parent

576,766

406,723

Non-controlling interests

7,322

7,237

584,088

413,960

Fixed assets

Intangible assets

11

35,625

40,000

Tangible assets

12

923,150

1,010,611

Investments

13

-

-

958,775

1,050,611

Current assets

Stocks

14

1,863,385

1,883,824

Debtors

15

2,011,811

1,844,351

Cash at bank and in hand

584,121

760,006

4,459,317

4,488,181

Creditors

Amounts falling due within one year

16

2,552,951

2,638,177

Net current assets

1,906,366

1,850,004

Total assets less current liabilities

2,865,141

2,900,615

Creditors

Amounts falling due after more than one year

17

(339,083

)

(433,126

)

Provisions for liabilities

19

(199,800

)

(223,800

)

Net assets

2,326,258

2,243,689

Capital and reserves

Called up share capital

20

200,000

200,020

Share premium

77,777

227,777

Capital redemption reserve

537,574

537,554

Retained earnings

1,352,261

1,127,015

2,167,612

2,092,366

Non-controlling interests

158,646

151,323

Total equity

2,326,258

2,243,689

The financial statements were approved by the Board of Directors and authorised for issue on 21st July 2026 and were signed on its behalf by:

B Freeman - Director

Fixed assets

Intangible assets

11

-

-

Tangible assets

12

-

-

Investments

13

200,000

200,000

200,000

200,000

Current assets

Debtors

15

875,172

820,764

Cash at bank

363,016

413,164

1,238,188

1,233,928

Creditors

Amounts falling due within one year

16

248,353

227,883

Net current assets

989,835

1,006,045

Total assets less current liabilities

1,189,835

1,206,045

Creditors

Amounts falling due after more than one year

17

249,767

272,683

Net assets

940,068

933,362

Capital and reserves

Called up share capital

20

200,000

200,020

Share premium

-

150,000

Capital redemption reserve

537,574

537,554

Retained earnings

202,494

45,788

940,068

933,362

Company's profit for the financial year

484,206

441,201

The financial statements were approved by the Board of Directors and authorised for issue on 21st July 2026 and were signed on its behalf by:

B Freeman - Director

Called up

Capital

share

Retained

Share

redemption

capital

earnings

premium

reserve

£

£

£

£

Balance at 1st January 2024

250,020

1,187,292

227,777

487,554

Changes in equity

Total comprehensive income

-

356,723

-

50,000

Reduction in share capital

(50,000

)

-

-

-

Dividends

-

(417,000

)

-

-

Balance at 31st December 2024

200,020

1,127,015

227,777

537,554

Changes in equity

Total comprehensive income

-

576,746

-

20

Reduction in share capital

(20

)

-

-

-

Reclassify share premium

-

150,000

(150,000

)

-

Dividends

-

(501,500

)

-

-

Balance at 31st December 2025

200,000

1,352,261

77,777

537,574

Undistrib'l

Non-controlling

Total

reserves

Total

interests

equity

£

£

£

£

Balance at 1st January 2024

200,000

2,352,643

144,086

2,496,729

Changes in equity

Total comprehensive income

-

406,723

7,237

413,960

Reduction in share capital

-

(50,000

)

-

(50,000

)

Reverse revaluation on sale of

property

(200,000

)

(200,000

)

-

(200,000

)

Dividends

-

(417,000

)

-

(417,000

)

Balance at 31st December 2024

-

2,092,366

151,323

2,243,689

Changes in equity

Total comprehensive income

-

576,766

7,322

584,088

Reduction in share capital

-

(20

)

-

(20

)

Dividends

-

(501,500

)

-

(501,500

)

Balance at 31st December 2025

-

2,167,612

158,645

2,326,257

Called up

share

Retained

Share

capital

earnings

premium

£

£

£

Balance at 1st January 2024

250,020

197,587

150,000

Changes in equity

Profit for the year

-

441,201

-

Purchase of own shares

-

(200,000

)

-

Total comprehensive income

-

241,201

-

Reduction in share capital

(50,000

)

-

-

Dividends

-

(393,000

)

-

Balance at 31st December 2024

200,020

45,788

150,000

Changes in equity

Profit for the year

-

484,206

-

Purchase of own shares

-

-

-

Total comprehensive income

-

484,206

-

Reduction in share capital

(20

)

-

-

Reclassify share premium

-

150,000

(150,000

)

Dividends

-

(477,500

)

-

Balance at 31st December 2025

200,000

202,494

-

Capital

redemption

Undistrib'l

Total

reserve

reserves

equity

£

£

£

Balance at 1st January 2024

487,554

200,000

1,285,161

Changes in equity

Profit for the year

-

-

441,201

Purchase of own shares

50,000

-

(150,000

)

Total comprehensive income

50,000

-

291,201

Reduction in share capital

-

-

(50,000

)

Reverse revaluation on sale of

property

-

(200,000

)

(200,000

)

Dividends

-

-

(393,000

)

Balance at 31st December 2024

537,554

-

933,362

Changes in equity

Profit for the year

-

-

484,206

Purchase of own shares

20

-

20

Total comprehensive income

20

-

484,226

Reduction in share capital

-

-

(20

)

Dividends

-

-

(477,500

)

Balance at 31st December 2025

537,574

-

940,068

Cash flows from operating activities

Cash generated from operations

1

788,234

226,744

Interest paid

(21,011

)

(24,541

)

Interest element of hire purchase payments paid

(22,289

)

(23,621

)

Tax paid

(151,503

)

(160,472

)

Net cash from operating activities

593,431

18,110

Cash flows from investing activities

Purchase of tangible fixed assets

(247,964

)

(280,024

)

Sale of tangible fixed assets

84,000

114,548

Sale of investment property

-

950,000

Interest received

1,743

447

Net cash from investing activities

(162,221

)

784,971

Cash flows from financing activities

Capital repayments in year

(181,728

)

(171,736

)

Amount introduced by directors

76,133

6,947

Amount withdrawn by directors

-

(23,952

)

Share buyback

-

(200,000

)

Equity dividends paid

(501,500

)

(417,000

)

Net cash from financing activities

(607,095

)

(805,741

)

Decrease in cash and cash equivalents

(175,885

)

(2,660

)

Cash and cash equivalents at beginning of year

2

760,006

762,666

Cash and cash equivalents at end of year

2

584,121

760,006