REGISTERED NUMBER: 01456314 (England and Wales)

Group Strategic Report,

Report of the Directors and

Consolidated Financial Statements

for the Year Ended 31 December 2025

for

Kelston Sparkes Holdings Limited

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

3

Statement of Directors' Responsibilities

5

Report of the Independent Auditors

6

Consolidated Statement of Comprehensive Income

10

Consolidated Balance Sheet

11

Company Balance Sheet

12

Consolidated Statement of Changes in Equity

13

Company Statement of Changes in Equity

14

Consolidated Cash Flow Statement

15

Notes to the Consolidated Cash Flow Statement

16

Notes to the Consolidated Financial Statements

17

DIRECTORS:

A K Sparkes

R Stark

K D Stark

D Swann

SECRETARY:

R Stark

REGISTERED OFFICE:

Bromley

Stanton Drew

Bristol

Somerset

BS39 4DE

REGISTERED NUMBER:

01456314 (England and Wales)

SENIOR STATUTORY AUDITOR:

Michael Cook BSc FCA

AUDITORS:

A C Mole LLP

Chartered Accountants

& Statutory Auditor

Stafford House

Blackbrook Park Avenue

Taunton

Somerset

TA1 2PX

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

REVIEW OF BUSINESS

The results for the year and financial position of the company are shown in the annexed financial statements.

The group undertakes comprehensive business planning to define long term strategic objectives and goals. Annual budgets and operational plans are prepared utilising financial Key Performance Indicators ("KPI's"). Business performance, measured by KPI's (including monitoring of actual results against budget targets) and bank balances, is reported to the directors on a monthly basis.

The turnover for the group for the year was £50,110,108 (2024 - £64,785,611) and the gross profit margin achieved was 24.4% (2024 - 22.5%).

The group has had another very strong year albeit with a significant reduction in turnover but an increase in gross margin. This is a result of the contracts undertaken this year not having the same level of material and subcontractors provision reducing turnover. The material and subcontractor provision generate a lower fixed margin therefore the increase in margin was in line with expectation. 2026 is expected to be another strong year for the group, similar level of turnover and margins are predicted to be maintained.

The Directors anticipate that the group will continue to trade profitably for the forthcoming year.

PRINCIPAL RISKS AND UNCERTAINTIES

As with any business, Kelston Sparkes Holdings Limited faces a number of risks and uncertainties in the course of its day to day operations. By effectively identifying and managing these risks their effects can be mitigated.

The principal risk to the company and the group is a deterioration in demand from the UK Construction Industry. Any deterioration in economic conditions may significantly decrease demand which could have a material effect on revenues, margins, profits and debt levels.

The Directors also constantly monitor the state of receivables, as this remains a key factor in protecting the company and group's cash flow in the short and medium term.

FUTURE DEVELOPMENTS

The directors will continue to monitor costs closely in order to maintain profitability, whilst not compromising on quality and service. The directors will also continue to diversify into new products and markets when appropriate.

ON BEHALF OF THE BOARD:

R Stark - Director

18 August 2026

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

DIVIDENDS

An interim dividend of 0.48 per share on the Ordinary £1 shares was paid on 16 July 2025. The directors recommend that no final dividend be paid on these shares.

The total distribution of dividends for the year ended 31 December 2025 will be £ 2,061,000 .

DIRECTORS

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

A K Sparkes

R Stark

K D Stark

D Swann

FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The directors are responsible for monitoring financial risk. Appropriate policies have been developed and implemented to identify, evaluate and manage the key risks.

a) Price risk - The company is exposed to price risk as a result of its operations. Due to the economic climate the company has to quote competitive prices to win work. The directors are aware of the risks in selling and providing services at low margins and as the trading environment improves the directors will consider improving margins.

b) Credit risk - The company has implemented policies that require appropriate credit checks on customers before contracts are entered into. The credit given to customers is subject to limits which are determined and reassessed by the directors.

c) Liquidity risk - The company is reliant upon the continued support of its bankers. Budgets and cash flow projections are prepared and regularly monitored to ensure that the company operates within these facilities.

d) Interest rate cash flow risk - The company has a bank overdraft facility which is repayable on demand. The interest charged on the overdraft is at a competitive rate of interest.

e) Economic risk - The company's performance is directly impacted by the economic environment. In order to manage this risk the company strives to deliver competitively priced services. The company is actively concentrating on improving efficiency and reducing costs.

GOING CONCERN

The group meets its day-to-day working capital requirements through an invoice financing facility to supplement cash reserves in managing the group's working capital requirements. The group forecasts and projections, taking account of possible changes in trading conditions, show the group should be able to operate within its existing funding arrangements.

In addition, the Directors have confirmed their continued commitment to providing financial support to the Company for the foreseeable future. On this basis the Directors consider it appropriate to prepare the accounts on a going concern basis.

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, A C Mole LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

R Stark - Director

18 August 2026

The directors are responsible for preparing the Strategic report, the directors' 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, including Financial Reporting Standard 102 Reduced Disclosure Framework (FRS 102).

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;

-

state whether applicable United Kingdom Accounting Standards, including FRS 102, have been followed, subject to any material departures disclosed and explained in the financial statements;

-

notify the company's shareholders in writing about the use of disclosure exemptions, if any, of FRS 102 used in the preparation of 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 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.

Opinion

We have audited the financial statements of Kelston Sparkes Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2025 which comprise the Consolidated Statement of 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 revised financial statements:

- give a true and fair view, seen as at the date the original financial statements were approved, of the state of the group's and of the parent company affairs as at 31 December 2020 and of the group's profit for the year then ended;

- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice seen as at the date the original financial statements were approved; and

- have been prepared in accordance with the requirements of the Companies Act 2006 as they have effect under the Companies (Revision of Defective Accounts and Reports) Regulations 2008.

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, the Report of the Directors and the Statement of Directors' Responsibilities, 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 five, 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.

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

Identifying and assessing potential risks of material misstatement due to irregularities.

We considered the following when identifying and assessing risks of material misstatement due to irregularities, including fraud and non-compliance with laws and regulations;

- the legal and regulatory framework within which the business operates

- the nature of the industry in which the business operates

- the control environment and internal controls established to mitigate such risks

- the results of our enquiries of management about their own identification and assessment of risks of irregularities

- discussions within the audit engagement team and with the group auditors about where fraud might occur.

Laws and regulations which are considered to be significant to the entity include those relating to the construction industry, the requirements of the financial reporting framework FRS 102, the Companies Act 2006 and UK tax legislation. In addition we considered other laws and regulations which may not directly impact the financial statements but may impact on the operations of the company, such as the changes arising following Brexit.

As a result of these procedures we concluded that the greatest potential for material misstatements due to fraud arose in respect of sales being overstated. In common with all audits under International Auditing Standards we also concluded that a risk in relation to the potential for management override of controls existed.

Audit responses to the risks identified

We undertook audit procedures to respond to the risks identified, and designed our audit testing to respond to these risks. The additional procedures we undertook included the following:

- Gaining an understanding of the company's procedures for ensuring compliance with laws and regulations.

- Substantive and additional testing of provisions on work in progress

- Controls testing over sales together with additional substantive procedures to agree to third party certificates.

- Testing the appropriateness of journal entries and other adjustments

- Considering whether accounting estimates were indicative of potential bias

- Considering any transactions which arose outside the normal course of business

- Making enquiries of management

- Corroborating our enquiries through the review of Board Minutes and review of correspondence.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members. We remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

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.

Michael Cook BSc FCA (Senior Statutory Auditor)

for and on behalf of A C Mole LLP

Chartered Accountants

& Statutory Auditor

Stafford House

Blackbrook Park Avenue

Taunton

Somerset

TA1 2PX

19 August 2026

TURNOVER

4

51,193,991

64,785,611

Cost of sales

38,501,509

50,330,760

GROSS PROFIT

12,692,482

14,454,851

Administrative expenses

4,829,666

4,741,663

OPERATING PROFIT

6

7,862,816

9,713,188

Interest receivable and similar income

260,000

33,497

8,122,816

9,746,685

Interest payable and similar expenses

7

647,662

917,373

PROFIT BEFORE TAXATION

7,475,154

8,829,312

Tax on profit

8

1,626,711

1,986,341

PROFIT FOR THE FINANCIAL YEAR

5,848,443

6,842,971

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

5,848,443

6,842,971

Profit attributable to:

Owners of the parent

5,848,409

6,843,016

Non-controlling interests

34

(45

)

5,848,443

6,842,971

Total comprehensive income attributable to:

Owners of the parent

5,848,409

6,843,016

Non-controlling interests

34

(45

)

5,848,443

6,842,971

FIXED ASSETS

Intangible assets

11

502,271

560,147

Tangible assets

12

30,811,529

31,648,002

Investments

13

-

-

Investment property

14

1,845,000

1,845,000

33,158,800

34,053,149

CURRENT ASSETS

Stocks

15

292,035

237,977

Debtors: amounts falling due within one year

16

14,965,894

14,097,216

Cash at bank and in hand

7,780,690

6,658,695

23,038,619

20,993,888

CREDITORS

Amounts falling due within one year

17

16,912,967

16,473,221

NET CURRENT ASSETS

6,125,652

4,520,667

TOTAL ASSETS LESS CURRENT LIABILITIES

39,284,452

38,573,816

CREDITORS

Amounts falling due after more than one year

18

(8,280,424

)

(12,539,409

)

PROVISIONS FOR LIABILITIES

23

(6,803,088

)

(5,620,910

)

NET ASSETS

24,200,940

20,413,497

CAPITAL AND RESERVES

Called up share capital

24

3,952,100

3,952,100

Revaluation reserve

25

865,096

865,096

Retained earnings

25

19,383,321

15,595,912

SHAREHOLDERS' FUNDS

24,200,517

20,413,108

NON-CONTROLLING INTERESTS

26

423

389

TOTAL EQUITY

24,200,940

20,413,497

The financial statements were approved by the Board of Directors and authorised for issue on 18 August 2026 and were signed on its behalf by:

R Stark - Director

K D Stark - Director

FIXED ASSETS

Intangible assets

11

-

-

Tangible assets

12

4,575,554

4,575,554

Investments

13

4,228,201

4,228,201

Investment property

14

1,845,000

1,845,000

10,648,755

10,648,755

CURRENT ASSETS

Debtors: amounts falling due within one year

16

20,360

255

Debtors: amounts falling due after more than one year

16

2,470,391

865,110

Cash at bank

9,000

7,262

2,499,751

872,627

CREDITORS

Amounts falling due within one year

17

83,457

80,059

NET CURRENT ASSETS

2,416,294

792,568

TOTAL ASSETS LESS CURRENT LIABILITIES

13,065,049

11,441,323

CREDITORS

Amounts falling due after more than one year

18

(7,764,846

)

(6,267,957

)

PROVISIONS FOR LIABILITIES

23

(288,366

)

(288,366

)

NET ASSETS

5,011,837

4,885,000

CAPITAL AND RESERVES

Called up share capital

24

3,952,100

3,952,100

Revaluation reserve

25

865,096

865,096

Retained earnings

25

194,641

67,804

SHAREHOLDERS' FUNDS

5,011,837

4,885,000

Company's profit for the financial year

2,052,837

26,809

The financial statements were approved by the Board of Directors and authorised for issue on 18 August 2026 and were signed on its behalf by:

R Stark - Director

K D Stark - Director

Called up

share

Retained

Revaluation

capital

earnings

reserve

£

£

£

Balance at 1 January 2024

3,952,100

9,337,896

865,096

Changes in equity

Dividends

-

(585,000

)

-

Total comprehensive income

-

6,843,016

-

Balance at 31 December 2024

3,952,100

15,595,912

865,096

Changes in equity

Dividends

-

(2,061,000

)

-

Total comprehensive income

-

5,848,409

-

Balance at 31 December 2025

3,952,100

19,383,321

865,096

Non-controlling

Total

Total

interests

equity

£

£

£

Balance at 1 January 2024

14,155,092

434

14,155,526

Changes in equity

Dividends

(585,000

)

-

(585,000

)

Total comprehensive income

6,843,016

(45

)

6,842,971

Balance at 31 December 2024

20,413,108

389

20,413,497

Changes in equity

Dividends

(2,061,000

)

-

(2,061,000

)

Total comprehensive income

5,848,409

34

5,848,443

Balance at 31 December 2025

24,200,517

423

24,200,940

Called up

share

Retained

Revaluation

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 January 2024

3,952,100

40,995

865,096

4,858,191

Changes in equity

Total comprehensive income

-

26,809

-

26,809

Balance at 31 December 2024

3,952,100

67,804

865,096

4,885,000

Changes in equity

Dividends

-

(1,926,000

)

-

(1,926,000

)

Total comprehensive income

-

2,052,837

-

2,052,837

Balance at 31 December 2025

3,952,100

194,641

865,096

5,011,837

Cash flows from operating activities

Cash generated from operations

1

12,036,025

12,202,613

Net cash from operating activities

12,036,025

12,202,613

Cash flows from investing activities

Purchase of tangible fixed assets

(2,635,075

)

(2,461,607

)

Sale of tangible fixed assets

2,669,247

2,500,913

Interest received

524,493

33,497

Net cash from investing activities

558,665

72,803

Cash flows from financing activities

Loan repayments in year

(1,450,898

)

(124,448

)

Hire purchase repayments in year

(7,038,776

)

(6,135,956

)

Amount introduced by directors

226,491

-

Amount withdrawn by directors

(236,357

)

(82,763

)

Interest paid

(83,735

)

(132,379

)

Interest on hire purchase payments

(828,420

)

(784,994

)

Equity dividends paid

(2,061,000

)

(585,000

)

Net cash from financing activities

(11,472,695

)

(7,845,540

)

Increase in cash and cash equivalents

1,121,995

4,429,876

Cash and cash equivalents at beginning of year

2

6,658,695

2,228,819

Cash and cash equivalents at end of year

2

7,780,690

6,658,695

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2025

2024

£

£

Profit before taxation

7,475,154

8,829,312

Depreciation charges

4,390,956

4,392,453

Profit on disposal of fixed assets

(350,878

)

(162,939

)

Amounts recoverable on contracts

858,765

(2,668,101

)

Impairment

-

350,000

Finance costs

647,662

917,373

Finance income

(260,000

)

(33,497

)

12,761,659

11,624,601

(Increase)/decrease in stocks

(54,058

)

60,359

Increase in trade and other debtors

(1,727,443

)

(2,468,027

)

Increase in trade and other creditors

1,055,867

2,985,680

Cash generated from operations

12,036,025

12,202,613

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2025

31.12.25

1.1.25

£

£

Cash and cash equivalents

7,780,690

6,658,695

Year ended 31 December 2024

31.12.24

1.1.24

£

£

Cash and cash equivalents

6,658,695

2,228,819

3.	ANALYSIS OF CHANGES IN NET DEBT

Other

non-cash

At 1.1.25

Cash flow

changes

At 31.12.25

£

£

£

£

Net cash

Cash at bank

and in hand

6,658,695

1,121,995

7,780,690

6,658,695

1,121,995

7,780,690

Debt

Finance leases

(16,918,511

)

7,038,776

(3,179,901

)

(13,059,636

)

Debts falling due

within 1 year

(136,602

)

136,602

-

-

Debts falling due

after 1 year

(1,314,296

)

1,314,296

-

-

(18,369,409

)

8,489,674

(3,179,901

)

(13,059,636

)

Total

(11,710,714

)

9,611,669

(3,179,901

)

(5,278,946

)