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FOR THE YEAR ENDED 31 DECEMBER 2024
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WILDANET LIMITED
COMPANY INFORMATION
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WILDANET LIMITED
CONTENTS
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WILDANET LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The directors present their strategic report for the year ended 31 December 2024.
The Company’s strategy is to provide high-quality, gigabit capable fibre-to-the-premises (“FTTP”) internet access for Cornwall and Devon, much of which remains either underserved or has no FTTP presence. The Company believes that every person, community and business has the right to be part of the worldwide digital community, and to benefit from all the opportunities that it brings. As such, it is the intention of the Company to provide the fastest and the most reliable network for customers, targeting areas that are currently underserved, and furthering digital inclusion across the region.
The principal activity of the Company is the provision of internet services to residential and business customers.
Results for the year ending 31 December 2024 were as outlined by the following financial key performance indicators: 1) Revenue: £1,757,580 (2023: £1,367,658) 2) EBITDA: loss of £4,306,836 (2023: loss of £7,548,971) 3) Loss after tax: £74,282,826 (2023: loss of £13,908,443) 4) Fixed assets: £36,960,528 (2023: £60,241,350) 5) Headcount: 212 (2023: 184) Management also use other KPIs such as ready for service premises, cost per premises passed, cost per premises connected, penetration rates and average revenue per user. The focus for the Company during the year has been to make progress in the build out of our FTTP network and connect new customers to this network. The revenue growth of £0.4m is due to the continued growth of our customer base. The losses are due to the expansion of the business operations and recognition of an impairment. The business operates in a competitive landscape where companies are aiming to build out FTTP networks across the country to provide gigabit capable internet access to residential and business customers. While the Company has developed a strong regional presence which enables it to maintain a competitive position in Cornwall and Devon, it is still susceptible to competitive dynamics in the wider market which have put pressure on customer tariffs. Combined with withdrawing from completing 2 of its 3 contracts with BDUK, these changes in trading performance and forecasts led management to believe there were indicators of an impairment. Upon assessment management concluded that an impairment charge of £55,614,596 was required as at 31 December 2024. Further detail is provided in Note 3. On 8 May 2024, the Group completed a reorganisation by way of a share for share exchange, with Wildanet Midco 2 Limited acquiring the share capital of Wildanet Limited and Wildanet Holdco Limited becoming the parent company of the Group.
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WILDANET LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The Group entered into an agreement for further funding with the Gresham House British Sustainable Infrastructure Fund III LP on 20 December 2024 for continued funding of capital and operating expenditure. With the exception of this new loan note, on 23 December 2024 Wildanet Midco 1 Limited listed all its existing loan notes with Gresham House BSI Infrastructure LP/Gresham House British Sustainable Infrastructure Fund II LP on The International Stock Exchange. OUTLOOK FOR TRADING IN 2026 The Company expects the performance in 2026 to show a further growth of the business. The network build will continue, which will drive an increase in revenue as the business will have an increasing pool of potential customers who could be served with gigabit capable internet access. The Company will continue to utilise Government support mechanisms to fund construction of the network, which will open up the region to the benefits of gigabit capable internet access. However, these Government support mechanisms, as well as funding from the Company’s lenders and majority shareholders, are contingent on performance and, in particular, continued delivery of the FTTP network. Further detail is provided in the Going Concern section of the Directors' Report.
The Government has pledged to financially support the roll out of gigabit capable internet to the final 20% of the country through its Project Gigabit schemes, managed by Building Digital UK (“BDUK”). BDUK manage this process through a range of incentive schemes, with the Group partaking in 2 of these, namely the Gigabit Infrastructure Subsidy (GIS) scheme and the Gigabit Broadband Voucher Scheme (GBVS). The Company has 3 contracts with BDUK under the GIS scheme which are at differing stages of completion.
PRINCIPAL RISKS AND UNCERTAINTIES The Directors recognise that the outlook for the Company is based on a number of key assumptions, some of which are outside the Company’s control. A detailed risk analysis has been undertaken, together with the development of appropriate plans to mitigate such risks. The Company maintains a schedule of revisiting and updating these risks on a continual basis. The Directors consider that the primary risks to the business in the short to medium term are in relation to the ability to build out our network capacity in a safe, efficient and timely manner such that we meet our expected growth in customer numbers and associated revenue. Within infrastructure projects such as these there are a number of dependencies, from planning timing through to health and safety which need to be managed in order to meet time, quality and cost deliverables. There are a number of uncontrollable risks that can affect the Company. The Directors aim to reduce the impact of these risks at all times by ensuring good controls are in operation within the business. The Board considers the principal risks to be as follows:
Market conditions
Close working relations are maintained with both the Company’s suppliers and customers in order to monitor market changes. Economic and interest rate changes are also monitored in relation to the impact they will have on the market conditions for the Company.
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WILDANET LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Liquidity risk The Company is exposed to liquidity risk through its suppliers and contractors. Supplier and contractor risk, where staged payments may be made during the life of a contract before final delivery is concluded, is addressed through the active monitoring of credit status and the use of contractual mechanisms. Funding risk The Company is exposed to funding risk through its performance-linked funding from BDUK, lenders and its majority shareholder. Funding risk is addressed through active management of cash flows and forecasting to ensure sufficient funding is available to meet payments. Further details on the fundings risks facing the group are provided in the going concern section of the Directors' report. Interest rate risk The Company is exposed to interest rate risk through its borrowings. This is addressed through entering into fixed-rate agreements where possible and where floating-rate agreements are in place utilising interest rate hedging if appropriate. Stockholding risk The Company is exposed to stock risk through the need to carry sufficient stock to service the needs of its roll-out programme. Stock risk is addressed through the active review of stock levels to meet forecast requirements. Regulatory risk The Company utilises various Government schemes in order to build out its fibre network to locations which would be uncommercial without such schemes. The schemes are covered by a combination of regulatory and contractual agreements. If the objectives of the Government change in the future these support mechanisms may become less attractive or be removed, which would represent a risk to future build plans. The Company actively engages with the Government directly and through industry bodies regarding future regulatory changes. The Directors carefully monitor the potential impact of legislative changes which can impact operations, such as Health and Safety, Environmental and Telecommunications regulations.
This report was approved by the board on 25 August 2026 and signed on its behalf.
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WILDANET LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The Directors present their report and the audited financial statements for the year ended 31 December 2024.
The loss for the year, after taxation, amounted to £74,282,826 (2023: loss £13,908,443).
The losses are due to the expansion of the business operations and recognition of an impairment.
No dividends were paid or declared during the year (2023: £NIL).
The Directors who served during the year were:
Our overall objective is to continue to build out high-quality, gigabit capable FTTP network across Cornwall and Devon. It is our intention to work with the UK Government, through their various schemes, to build a network which includes those hard-to-reach locations and deliver gigabit capable internet access to underserved areas. The directors consider that as part of this we will need to ensure we have an appropriate mix of product offerings to ensure inclusivity and equality of access across the region, whilst ensuring we address the specific needs of different groups, for example residential and business customers. Our continued drive to ensure greater organisational efficiency and effectiveness will enable the business to achieve long term profitability.
The Company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the Company's Strategic Report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the Directors' Report.
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WILDANET LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
GOING CONCERN
The directors have assessed the Company’s ability to continue as a going concern through review of detailed budgets, cash flow forecasts and sensitivity analysis covering a period of at least 12 months from the date of approval of the financial statements. The forecasts are updated regularly to reflect current trading and incorporate all known operating costs, capital expenditure, debt servicing obligations, grant funding receipts and customer revenues. Based on these forecasts, the directors consider the Company to be adequately funded through to March 2027, with funding beyond this date being contingent on future performance and differing strategic options. In light of this, the majority shareholder of the ultimate parent company, Gresham House Investment Management (Guernsey) Limited, has provided a letter of support which the directors believe demonstrates its intention to make funding available as required for at least 12 months from the date of signing the financial statements. In reaching their conclusion, the directors considered a range of financial and operational risks, including sales volumes, pricing, build costs, supplier resilience and compliance with debt obligations. The Company benefits from a diversified customer base, with no single customer accounting for more than 1% of recurring revenue, limited exposure to interest rate and foreign exchange risk, and ongoing monitoring of key performance indicators, cash flow forecasts and budget performance. The directors also considered the Company’s dependence on Project Gigabit grant funding and debt facilities. While the directors believe adequate controls and contractual arrangements are in place to manage risks associated with Project Gigabit grant funding and debt facilities, the Company’s ability to drawdown on this funding is contingent on continued delivery against its build targets. Should the Company not meet these targets or other events transpire which impact the Company’s ability to hit its build targets, then there would be a material uncertainty in relation to the Company’s funding. The directors are considering a variety of strategic options for the Company, each of which varies in terms of funding requirement, and the likely outcome cannot be predicted with certainty at the time of approval of the accounts. Certain options would potentially require funding in excess of that which is committed and there is no guarantee it would be forthcoming. Hence the directors believe a material uncertainty exists in relation to the Company’s future funding requirements, which are contingent on future performance and differing strategic options, and would potentially result in funding being withheld or its longer-term funding requirement increasing significantly. These circumstances indicate the existence of a material uncertainty that may cast significant doubt on the Company’s ability to continue as a going concern; however, the directors remain satisfied that it is appropriate to prepare the financial statements on the going concern basis.
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WILDANET LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
A material event has taken place since the date of the balance sheet and the signing of this report, namely in March 2025 Wildanet Limited, a group company, undertook a strategic review of its resource requirements, leading to a collective consultation process in which 35 staff were made redundant.
On 25 February 2026 Wildanet Limited, a group company, entered into an agreement to terminate a contract for delivery of its network, agreeing a termination fee of £1.5m. Wildanet Limited subsequently entered into contracts with new suppliers for delivery of the same network. On 16 March 2026 and 18th March 2026 Wildanet Limited, a group company, also entered change requests with BDUK that descoped its remaining build on 2 contracts covering southwest Cornwall (Lot 32.02) and central Cornwall (Lot 32.03) respectively. Wildanet had delivered around 13,200 premises under these contracts but descoped the remaining 7,700 contracted premises. The contracts with BDUK remain in place and transitioned from their build phase into their operational phase. On 23 April 2026 Wildanet Limited, a group company, entered into an amendment agreement with its senior lenders to extend the maturity date to 24 May 2030, reduce the overall interest cost on a tranche of its Term Loan and remove amortisation prior to maturity. Concurrently, on 23 April 2026, the Wildanet Midco 1 Limited, a group company, entered into an agreement for further funding with the Gresham House British Sustainable Infrastructure Fund III LP for continued funding of capital and operating expenditure.
The auditors, PKF Francis Clark, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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WILDANET LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2024
The Directors are responsible for preparing the Strategic report, the Directors' report and the audited financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare audited financial statements for each financial year. Under that law the Directors have elected to prepare the audited financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under Company law the Directors must not approve the audited 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 audited financial statements, the Directors are required to:
∙select suitable accounting policies for the Company's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the 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 to 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.
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WILDANET LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WILDANET LIMITED
We have audited the financial statements of Wildanet Limited (the 'company') for the year ended 31 December 2024 which comprise the Statement of comprehensive income, the Statement of financial position, the Statement of changes in equity, and the related notes, 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 Company's affairs as at 31 December 2024 and of its loss 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.
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 United Kingdom, including the Financial Reporting Council'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.
We draw attention to Note 2.2 in the financial statements, which indicates that the company's future funding requirements are dependent on future trading performance and the strategic options pursued by the company and the wider group. As stated in Note 2.2, the directors are reliant upon Gresham House Sustainable Infrastructure strategy for future funding commitments and certain scenarios being considered by the directors may require funding in excess of that currently committed and there can be no certainty that such funding will be available if required. These events and conditions, along with the other matters set out in Note 2.2, indicate the existence of a material uncertainty that may cast significant doubt on the group's ability to continue as a going concern.
Our opinion is not modified in respect of this matter.
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.
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WILDANET LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WILDANET LIMITED (CONTINUED)
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditors' report 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 is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of our 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 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 on page 7, 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.
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WILDANET LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WILDANET LIMITED (CONTINUED)
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 Auditors' 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.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed as follows:
The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the company and management.
We obtained an understanding of the legal and regulatory frameworks that are applicable to the company at the planning stage of the audit. We gained an understanding of the industry in which the company operates as part of this assessment to identify the key laws and regulations affecting the company. As part of this, we reviewed the company’s website for indication of any regulations and certification in place which are applicable to the company and discussed these with the relevant individuals responsible for compliance. Based on our understanding of the company and industry, we identified that the principal risks of non-compliance with laws and regulations related to The General Data Protection Regulation (“GDPR”), health and safety regulations, employment laws, the Communications Act 2003 where non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation or the loss of the company’s licence to operate. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006 and tax legislation.
We discussed with management how compliance with these laws and regulations is monitored and discussed the policies and procedures in place. As part of our planning procedures, we assessed the risk of any non-compliance with laws and regulations on the company’s ability to continue trading and the risk of material misstatement to the accounts.
We also evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements. The key incentives identified related to demonstrating the continued viability of the company, including maintaining confidence among shareholders, lenders and other stakeholders, and supporting ongoing funding requirements. We determined that the principal fraud risks were associated with the potential overstatement of revenue and other measures of financial performance, together with management bias in significant areas of judgement and estimation, particularly in relation to going concern and impairment assessments.
Based on this understanding, we designed our audit procedures to identify non-compliance with such laws and regulations. Our procedures included:
∙Enquiries of management and those charged with governance regarding their knowledge of actual, suspected or alleged fraud, non-compliance with laws and regulations, litigation and claims.
∙Reviewing board minutes, significant correspondence and legal and professional fees to identify any matters relating to actual or potential breaches of laws and regulations.
∙Considering filings made at Companies House and reviewing compliance with relevant company law requirements.
∙Reviewing and challenging significant accounting estimates and judgements, particularly those relating to the impairment assessment, recoverability of investments and intercompany balances, and the going concern assessment, to identify indicators of management bias.
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WILDANET LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WILDANET LIMITED (CONTINUED)
∙Testing journal entries and other adjustments, with a particular focus on unusual, manual or post-close journals, and assessing the business rationale for significant transactions outside the normal course of business.
∙Performing substantive testing over revenue and grant income, including assessing whether income had been recognised in the appropriate accounting year and considering the risk of fraudulent revenue recognition.
∙Assessing the company's compliance with the conditions attached to significant grant funding arrangements and considering the impact of these arrangements on the financial statements.
∙Evaluating the directors' going concern assessment, including reviewing cash flow forecasts, available funding facilities, shareholder support arrangements, forecast covenant compliance and management's sensitivity analysis. We also assessed whether the related disclosures appropriately described the material uncertainty identified by the directors.
∙Evaluating the assumptions underpinning the impairment review, including consideration of the external valuation report, forecast customer growth, expected cash flows and other key valuation assumptions.
∙Evaluating the overall presentation, structure and content of the financial statements, including whether the disclosures appropriately reflect the significant judgements, estimates and funding uncertainties affecting the Group.
We communicated with those charged with governance regarding, amongst other matters, the planned scope and timing of the audit, significant audit findings, significant deficiencies in internal control identified during the audit, and significant judgements relating to going concern and impairment.
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. The risk of not detecting a material misstatement in the financial statements is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate omissions, collusion, forgery, misrepresentations, or the override of internal controls. We are also less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements.
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 Auditors' 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 Auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
James M Barrett BA (Hons) BFP FCA (Senior statutory auditor)
for and on behalf of
PKF Francis Clark
Statutory Auditor
Melville Building East
Unit 18, 23 Royal William Yard
Plymouth
Devon
PL1 3GW
25 August 2026
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WILDANET LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
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WILDANET LIMITED
REGISTERED NUMBER:10586466
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 16 to 36 form part of these financial statements.
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WILDANET LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
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WILDANET LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Wildanet Limited is a private company limited by shares registered in England and Wales, registered number 10586466. The registered office is Westbourne House, West Street, Liskeard, PL14 6BT.
The principal activity of the Company is the provision of internet services to residential and business customers within the South West of England.
2.ACCOUNTING POLICIES
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The financial statements are prepared in sterling which is the functional currency of the Company. The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies. Wildanet Limited meets the definition of a qualifying entity under FRS 102 and has therefore taken advantage of the disclosure exemptions available to it. Exemptions have been taken in relation to share-based payments, financial instruments, presentation of a Cash Flow Statement and remuneration of key management personnel.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.ACCOUNTING POLICIES (CONTINUED)
Income is generated from customers either from up front installation and connection charges, or from an ongoing contract subject to monthly fees. Connection and installation charges are recognised as invoiced as the obligation to the user is extinguished once the connection has taken place. These charges include the recovery of cost for administration in providing service to the customer, including the activation of the service from the network to the customer, as well as providing the final connection to the network. Income from the service contract is recognised evenly over the life of the contract irrespective of when invoicing takes place. Typically customers are invoiced monthly as the service is consumed. Income can also be earned from subsidies provided by either local or central government sources as part of the drive towards improved broadband provision across the United Kingdom. Where such income is derived as part of our service, the income received is recognised over the life of the obligation behind the subsidy received. Where the support mechanism is derived from an underlying grant from a government body to the customer, with all or a proportion invoiced by us to the customer, the revenue is recognised in full at the time of invoicing. If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.ACCOUNTING POLICIES (CONTINUED)
If the terms of the grant do impose performance-related conditions on the recipient, the grant is only recognised in income when the performance-related conditions are met. Any grants that are received before the revenue recognition criteria are met are recognised in the entity's financial statement as a liability.
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.ACCOUNTING POLICIES (CONTINUED)
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Assets under construction are accounted for at cost. They are not depreciated until the accounting period in which they are brought into use. The Company brings the assets into use only once the system is live.
Amortisation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
The estimated useful lives range as follows:
The assets' residual values, useful lives and amortisation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
At each reporting date the Company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
Assets under construction are accounted for at cost. They are not depreciated until the accounting period in which they are brought into use. The Company brings the assets into use only once the fibre cables being laid become live.
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.ACCOUNTING POLICIES (CONTINUED)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
The estimated useful lives range as follows:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.ACCOUNTING POLICIES (CONTINUED)
The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
The Company has elected to apply the recognition and measurement provisions of IFRS 9 Financial Instruments (as adopted by the UK Endorsement Board) with the disclosure requirements of Sections 11 and 12 and the other presentation requirements of FRS 102.
Financial instruments are recognised in the Company's Statement of financial position 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
Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.
Other financial assets
Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.
Impairment of financial assets
At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. 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.
Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.ACCOUNTING POLICIES (CONTINUED)
If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
Basic financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other creditors, bank loans and other loans are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Other financial instruments
Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.
Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Depreciation rates Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives. The bases for depreciation charges are detailed in note 2.13 and are reviewed and adjusted prospectively if appropriate or if there is a significant change since the last reporting date. Useful lives are estimated by management with reference to manufacturers guidelines and existing knowledge and experience. Impairment assessment Management considered the requirements of FRS 102 and assessed the recoverable amount of the relevant cash-generating unit ("CGU"). Given the integrated nature of the Group's operations, network infrastructure, customers, workforce and cash flow generation, management concluded that Wildanet Limited's operations represent a single CGU for impairment assessment purposes. The valuation in use was assessed using a discounted cash flow model, while the fair value less costs to sell was assessed using market-based valuation techniques, supported with input from an independent valuation prepared by a third party. Management concluded the recoverable amount was determined by reference to the higher of value in use and fair value less costs to sell. Management concluded that Fair value less selling costs was higher. The impairment review required significant judgement and estimation. For the value in use these were forecast growth rates and average revenues per user, operating costs, build and installation costs and volumes, and the discount rate. For the fair value less costs to sell this was the range of comparable valuations focusing mainly on enterprise value to ready for service premises ratios, which are based on independent third party sales data obtained from comparable transactions within the relevant industry and market. Management performed a sensitivity analysis on this key assumption, being the value attributed to a ready-for-service premises in the third-party valuation. Having considered all relevant factors, management concluded that an impairment charge of £55,614,596 was required as at 31 December 2024. The impairment charge has been allocated across all relevant asset classes within the CGU in proportion to their carrying values immediately before impairment. Carrying value before impairment: £90,332,640 Impairment charge recognised in 2024: £55,614,596 Carrying value after impairment: £34,718,044 The principal assets affected by the impairment assessment comprise network infrastructure, fibre assets, plant and equipment and associated assets under construction.
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 24
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 25
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 26
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
12.TAXATION (CONTINUED)
There were no factors that may affect future tax charges.
Page 27
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WILDANET LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 28
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