The directors present the strategic report for the year ended 31 December 2025.
H+H UK Limited is the largest manufacturer of aircrete blocks & systems in the UK. We bring our product, together with our experience, know-how and advice on building materials and building technology to support our long-term trading partners.
After some improvement in sales volumes in 2024 and into early 2025, the market has reduced again in the second half of 2025. Our sales volumes (m3) in 2025 were 1% lower than 2024. In January 2026, in order to manage stock levels, we reduced our production capacity in Borough Green (by removing a shift). This will balance our production with the demand that we’re currently seeing, and we keep this under review.
Profitability in 2025 was higher than the underlying profitability in 2024 as a result of increased production capacity across the year. In 2024 we also had settlement costs of a legacy gas contract. We are expecting continued improvement in profitability as the market improves.
We continue to prioritise customer relationships and quality product, together with continuing to review our production capacity, to ensure we can react quickly to the increased demand we see coming in the market. Longer term trends remain consistent, and the need for more new homes to be delivered in the UK.
UK inflation and interest rates
Inflation has remained higher in 2025 than 2024, reaching 3.8% by the Autumn, before reducing to 3.0% at the beginning of 2026. At the current time we are entering a period of uncertainty in relation to energy prices as a result of the recent conflict that has started in Iran and affecting the wider Middle East. We do fix some energy volumes and prices in advance, and this will mitigate some of the effects. It is unknown at the current time how prolonged this will be, but we will need to seek to pass this onto customers.
The Bank of England base rate has continued to fall and is now at 3.75% in early 2026. This gives a more stable economic environment, and combined with the stated Government policies in relation to housing, gives us optimism that the market should start to come back as we go through 2026, and into 2027.
Financial risk management objectives and policies
The company's activities expose it to a number of financial risks including cash flow risk, credit risk, and liquidity risk. During 2022, the company entered into fixed volume and price gas contracts covering the period 2023 through to Q1 2026, however this volume was sold (and losses crystallised) during 2024. The company does now have gas and electricity volume that has been forward purchased, but uses it all in production, with any additional volume required purchased at spot rates.
Cash flow risk
The company has access to a Group treasury facility that currently has plenty of headroom. Our cash flow projections indicate that we will remain cash positive for the foreseeable future. Any surplus cash is placed on deposit or lent to our parent company. Any cash requirement is available as needed from our parent company.
Credit risk
The company has a financing initiative whereby we can choose to be paid early. The company exercises this option. If this initiative were to be withdrawn the company's cash flow would be adversely affected but would still operate within the current group facility.
Liquidity risk
The company uses a group facility to ensure that sufficient funds are available. Our cash flow projections indicate that sufficient funds should be available.
Quality Management Systems
The company has maintained third party quality assurance in respect of its Quality Management System and with the international standard BS EN ISO 9001:2015.
The company maintained the necessary documentation to continue to UKCA mark its products to meet the requirements of the Construction Products Regulations. All the Company’s masonry products continue to be assessed and approved by the British Board of Agrément as being fit for their intended purpose.
Whilst there are many uncertainties facing both the global and UK economies, the outlook for new housebuilding in the UK remains positive in the medium term.
The market outlook indicates improving market conditions as reported by our customers both in new build housing and RMI (Repair, Maintenance and Improvement).
The long-term outlook for aircrete remains positive. Aircrete continues to show increasing levels of market penetration as growth in the building industry is, in part, being driven by an increasing demand for larger, detached houses, which require more aircrete.
The following KPIs are used by the Board to assess the company's progress against its objectives and to measure the performance and development of the Company. The company's activities are regularly reviewed to ensure that they met the company's core strategy of being cash positive and profitable.
2025 2024
Turnover (£'000) 100,635 98,867
Gross profit (£'000) 33,675 16,317
Gross profit margin 33.46% 16.5%
EBITDA (£'000) 9,574 (5,866)
Turnover, Gross Profit and EBITDA all increased since last year.
Going concern
The directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the 12 months from the date of these statements. The directors continually monitor their forecast and cash flow statements to ensure that adequate funding is in place. Further details regarding the adoption of the going concern basis can be found in note 1.2 in the accounting policies in the financial statements.
The company's activities are regularly reviewed to ensure that they meet the core strategy of being cash positive and profitable. The directors are therefore content that this will not cause a going concern issue.
There are no impending developments or matters in the course of negotiation that would, in the opinion of the directors, be seriously prejudicial to the interest of the company.
The Directors of the company have acted in accordance with their duties codified in law, which include their duty to act in a way which they consider, in good faith, would most likely promote the success of the Company for the benefit of the members as a whole, having regards to all stakeholders and matters set out in s172(1) of the Companies Act 2006, including:
a) the likely consequences of any decision in the long term;
b) the interests of the company's employees;
c) the need to foster the company's business relationships with suppliers, customers and others;
d) the impact of the company's operations on the community and the environment;
e) the desirability of the company maintaining a reputation for high standards of business conduct; and
f) the need to act fairly as between members of the company.
The Board of Directors satisfies the criteria as set out in reference to S172(1)(a-f) of the Companies Act by considering the following:
1) Our strategy was designed to have a long-term beneficial impact on the company and to contribute to its success in delivering quality products and services to our customers. We will continue to operate our business within tight budgetary controls and in line with our regulatory targets.
2) Our stakeholders (both internal and external) are fundamental to the delivery of our strategy. Our relationship with our stakeholders is defined through our Trusted Partner ethos; do things to ensure both parties have equal leverage in the relationship. With regards to our employees, we provide regular two-way updates via our Senior Leadership Team, and our Employee Communications Committee. We have regular direct contact with all our customers at varying levels of our organisations. We also engage via our association with the HBF (Home Builders Federation) and sponsoring other trade related events. We engage directly and indirectly with our suppliers. Our indirect involvement come through our association with the MPA (Mineral Products Association), UKQAA (UK Quality Ash Association) and other trade associations.
3) The health, safety and well-being of our employees is one of our primary considerations in the way we do business. We conduct regular site safety days across all our factories which are attended by members of the board of directors. We strive to ensure that no harm comes to our stakeholders.
4) Our strategy took into account the impact of the company’s operations on the community and environment and our wider societal responsibilities. To this end we only innovate and invest to support long term sustainable business.
5) As the board of directors, our intention is to behave responsibly towards our shareholders so that they too may benefit from the successful delivery of our plan and ensure that management operate the business in a responsible manner. We operate within the high standards of business conduct and good governance expected for a business such as ours. By following these actions we will contribute to the delivery of our strategy.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 December 2025.
The results for the year are set out on page 12.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
These are fully referenced in the strategic report.
This is discussed in note 25.
Quantification and reporting methodology
We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol -Corporate Standard and have used a blend of the 2024 and 2025 UK Government's Conversion Factors together with our ultimate holding company, H+H International A/S and supplier specific conversion factors for company reporting.
Intensity measurement
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2 to Turnover.
Measure taken to improve efficiency
H+H UK Limited continues to prioritise the reduction of energy consumption and carbon emissions associated with its operations. Energy efficiency measures were implemented through ongoing continuous improvement projects, as well as capital investment projects. Total emissions increased compared to the prior year due to higher production volumes, with all three factories being fully operational for the year. Stock building actions contributed to a slight rise in the intensity ratio, as production volumes exceeded sales for the year.
SECR data
The following data includes scope 1,2 and 3 and summarises the energy consumption (kWh) and carbon emissions (tCO2e):
| Usage | CHG Emissions tCO2e | Usage | CHG Emissions tCO2e |
| 2025 | 2025 | 2024 | 2024 |
Natural gas | 429,081 GJ | 21,799 | 340,493 GJ | 17,298 |
Site fuels | 343,439 litres | 946 | 290,722 litres | 801 |
Grid electricity | 33,772 GJ | - | 26,742 GJ | - |
Raw materials | 165,271 tonnes | 129,920 | 121,565 tonnes | 97,159 |
Transportation | 102.5M km | 6,138 | 124.7M km | 9,028 |
Emission Total |
| 158,803 |
| 124,286 |
| CHG Emissions tCO2e | |
| 2025 | 2024 |
Scope 1 | 22,745 | 18,099 |
Scope 2 | - | - |
Scope 3 | 136,057 | 106,187 |
Total emissions | 158,802 | 124,286 |
| 2025 | 2024 |
Total GHG emissions tCO2e | 158,802 | 124,286 |
Intensity ratio (tCO2e : £’000turnover) | 1.578 | 1.257 |
tCO2(e) - tonnes of carbon dioxide (equivalent). CHG - Change in emissions
This is discussed in the strategic report.
In accordance with the company's articles, a resolution proposing that Lopian Gross Barnett & Co be reappointed as auditor of the company will be put at a General Meeting.
Compliance was continued with the Occupational Health and Safety Management Systems Standard BS ISO 45001. This same high standard of health and safety is reflected in the design, installation, operation and maintenance of plant, equipment and services for all works and projects undertaken by the company. The directors recognise that safe behaviour of staff is as important as good systems and communication, and that co-operation on their part is vital. To enrich this idea, the company will continue to engage all employees in continually improving their attitudes towards safety through focus on Behavioural Based Safety (BBS). It is company policy to provide a safe and healthy environment for employees, contractors, and visitors and to enhance the importance of health and safety.
Environment
The company has acted upon its environmental policy during the year and continued to circulate information widely to staff and customers to foster an understanding of environmental issues arising from the business. The environmental policy addresses the use of energy, raw materials, air, water, and waste and seeks to prevent and limit the environmental impact of its business activities.
The company has sought to continually improve environmental performance where it is reasonably practical and economic to do so.
Third party compliance with ISO 14001 for an environmental management system was maintained. The company has met targets requested by customers and continues with its environmental improvement teams set up at each of its locations.
The company maintained its systems to enable the retention of its Certificate of Approval for Responsible Sourcing of Construction Products to BES 6001 and obtained a "very good" performance rating and is accredited under the BS ISO 50001 Energy Management Systems Standard.
Quality Management
The Company maintains certification to ISO 9001 (Quality Management System), supporting consistent delivery of high-quality products and services. This framework underpins our commitment to continuous improvement, customer satisfaction, and robust operational processes across our business.
Employees
The Company ensures that all employees are treated fairly and granted the same access to continuing employment and training, career development and promotion, regardless of any physical disabilities.
The Company has taken the necessary action during the year to:
a) provide employees with regular information on matters of concern to them as employees;
b) consult employees or their representatives on a regular basis regarding decisions which are likely to affect their interests;
c) encourage employee involvement in the company's performance through appropriate incentive schemes;
d) achieve a common awareness on the part of all employees of the financial and economic factors affecting the performance of the company.
The directors of the Company have taken steps to regularly engage with employees and to have regard to employee interests, including on the principal decisions made during the financial year.
The directors have had regard to the need to foster the company’s business relationships with suppliers, customers and others, including on the principal decisions taken by the company during the financial year.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law, the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period.
In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
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 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.
We have audited the financial statements of H+H UK Limited (the 'company') for the year ended 31 December 2025 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial 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.
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 below.
We obtained an understanding of laws and regulations that affect the entity, focusing on those that had a direct effect on the financial statements or that had a fundamental effect on its operations.
Where considered necessary we enquired of those charged with governance, reviewed correspondence and reviewed meeting minutes for evidence of non-compliance with relevant laws and regulations.
We gained an understanding of the controls environment which includes the controls in place to prevent and detect fraud. We enquired of those charged with governance about any incidences of fraud that had taken place during the accounting period.
We reviewed financial statements disclosures to assess compliance with relevant laws and regulations.
We enquired of those charged with governance about actual and potential litigation and claims.
We performed analytical procedures to identify any unusual or unexpected relationships that might indicate risks of material misstatement due to fraud.
In addressing the risk of fraud due to management override of internal controls we tested the appropriateness of journal entries and assessed whether the judgements made in making accounting estimates were indicative of a potential bias.
Due to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing fraud or non-compliance with laws and regulations and cannot be expected to detect all fraud and non-compliance with laws and regulations.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
The notes on pages 16 to 31 form part of these financial statements.
The notes on pages 16 to 31 form part of these financial statements.
The notes on pages 16 to 31 form part of these financial statements.
The notes on pages 16 to 31 form part of these financial statements.
H+H UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is Celcon House, Ightham, Sevenoaks, Kent, TN15 9HZ.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £'000.
Where the company has taken exemptions in terms of FRS 102, this has been approved by the shareholders and that the appropriate disclosures have been reflected in the consolidated financial statements as per the requirement of the application guidance of FRS 102.
The company meets the definition of a qualifying entity under FRS 102 and has therefore taken advantage of the disclosure exemptions available to it in respect of its financial statements. The company is consolidated in the financial statements of its parent, H+H International A/S, Lautrupsgade 7, 6th Floor, 2100 Copenhagen 0, Denmark. These can be obtained at www.hplush.com. Exemptions have been taken in these company financial statements in relation to presentation of a cash flow statement, and remuneration of key management personnel.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.
Financial assets and liabilities are only offset in the statement of financial position when, and only when there exists a legally enforceable right to set off the recognised amounts and the company intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
With the exception of some hedging instruments, other debt instruments not meeting these conditions are measured at fair value through profit or loss.
Financial assets are derecognised when and only when a) the contractual rights to the cash flows from the financial asset expire or are settled, b) the company transfers to another party substantially all of the risks and rewards of ownership of the financial asset, or c) the company, despite having retained some, but not all, significant risks and rewards of ownership, has transferred control of the asset to another party.
Financial liabilities are derecognised only when the obligation specified in the contract is discharged, cancelled or expires.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
As at 31 December 2025, the company does have hedging instruments for gas & electricity. In 2023, a gas contract with fixed volumes and prices failed to meet the “own use exemption” and was therefore recognised using the hedge accounting principles in accordance with FRS 102 Section 12 (p12.5). From April 2024, this contract was settled, and any current forward purchasing is within the definition of “own use exemption". The loss on settlement of c.£12m was recognised in exceptional items in 2024. All volumes hedged now are well within the "own use exemption".
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that, based on all available evidence, it can be regarded as more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.
Where items recognised in other comprehensive income or equity are chargeable to or deductible for tax purposes the resulting current or deferred tax expense or income is presented in the same component of comprehensive income or equity as the transaction or other event that resulted in the tax expense or income.
The company operates two pension schemes. One provides benefits based on final pensionable pay and the other is a defined contribution scheme.
The defined benefit fund was closed to new entrants on 1 June 2007 and closed to the accrual of future service benefits, effective from 31 December 2011. The assets of the fund are held separately from those of the company.
The net interest cost on the net defined benefit liability is shown within finance costs. Remeasurement comprising actuarial gains and losses, the effect of the asset ceiling (if applicable) and the return on scheme assets (excluding interest) are recognised immediately in other comprehensive income. Pension scheme assets are measured at fair value and liabilities are measured on an actuarial basis.
The company operates a Group Personal Pension Plan (GPPP) for which contributions are based on rules of the scheme and are charged against profits during the year in which contributions are made. Differences between contributions payable in the year and contributions paid are shown as either accruals or prepayments in the balance sheet.
Leased assets
Rentals under operating leases are charged on a straight-line basis over the lease term, even if the payments are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight-line basis over the lease term.
Transactions in foreign currencies are recorded at the exchange rate ruling at the date of the transaction.
Assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the balance sheet date, unless, in the case of balances relating to trading transactions, there is a related forward contract, in which case the contract rate is used. All exchange differences are taken to the profit and loss account.
Interest receivable and similar income
Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable.
Related Party Transactions
Disclosures need not be given of transactions entered between two or more members of a group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member and so the company has taken advantage of the exemption from disclosing transactions with related parties that are part of the H+H International group.
There were no related party transactions which require disclosure.
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Defined benefit pension
The group has obligations to pay pension benefits to certain employees. The cost of these benefits and the present value of the obligation depend on a number of factors, including: life expectancy, salary increases, asset valuations and the discount rate on corporate bonds. Management, supported by an independent actuary, estimates these factors in determining the net pension obligation in the balance sheet. The assumptions reflect historical experience and current trends. There exists no explicit contractual right to a surplus return should contributions from the sponsoring employer exceed the calculated scheme deficit. The value of the net present value of future contributions is £0.0M (2024: £0.5M).
Exceptional items consisted of non-recurring expenditure incurred during the prior year, split between costs of sales and administrative expenses. These related to one off items in respect of a gas contract, this is explained further in note 1.9. Exceptional items have been disclosed separately on the face of the profit and loss statement. These are items which, in the opinion of the Directors, are material and unusual in nature or of such significance that they require separate disclosure. There were no such costs in the current year.
Turnover, which is derived wholly from within the UK, relates to the sale of aircrete products. Interest income is disclosed within note 9.
Turnover is stated net of customer rebates and discounts allowed.
The average monthly number of persons (including directors) employed by the company during the year was:
Their aggregate remuneration comprised:
The actual charge/(credit) for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:
In addition to the amount charged/(credited) to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:
Contained within the total cost value of owned plant and machinery of £77,072k are £8,409k (2024 - £8,184k) of items still under construction which have not been depreciated in the year.
The total cost of Freehold Land and Buildings £13,483k (2024 - £13,474k) can be split as follows: Land £1,001k (2024- £1,005k) and Buildings £12,482k (2024- £12,469k).
As stated in note 1.5 Freehold Land is not depreciated.
Derivative financial instruments recognised only contain the aforementioned commodity forward contracts which are measured at fair value using generally accepted valuation techniques based on observable market prices and forward market rates.
No other assets or liabilities are measured at fair value as of 31 December 2025.
Group loans are due for repayment within 5 days of any repayment request issued by the company however, we do not anticipate needing to recall any funds in the next 12 months due to the company's profitable operations.
There was an overdraft in the prior year which has been reclassified to intercompany. The Company is a member of the H+H International A/S Group’s global cash pooling arrangement and is jointly and severally liable, under the self-debt guarantee, for the full amount of the overdraft. External borrowings are held by the parent undertaking, and the Company’s utilisation of the facility is reflected in intercompany balances. The Directors consider the likelihood of the guarantee being called to be remote.
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
The deferred tax liability set out above is expected to reverse within 5 years and relates to accelerated capital allowances that are expected to mature within the same period.
Deferred tax assets and liabilities are offset only where the company has a legally enforceable right to do so and where the assets and liabilities relate to income taxes levied by the same taxation authority on the same taxable entity or another entity within the company.
There is no expiry date on timing differences, or tax credits.
Scheme characteristics and nature of the benefits provided
The Principal Employer, H+H UK Limited (the “Company”) operates a final salary defined benefit scheme for its employees. Any purely defined contribution assets and liabilities in this Pension Fund have been excluded. The H+H Celcon Pension Fund (the “Pension Fund”) closed to the future accrual of benefits on 31 December 2011, although some deferred members who are still employed by the Company retain the link to future salary increases on their benefits. Pension benefits are based on historic length of service and final salary. On retirement members can opt for a lump sum and a lower pension. The Pension Fund is managed by the Trustee. The Pension Fund operates within the standard UK regulatory framework for employer-sponsored pension schemes. Funding rates are agreed between the Trustee and the Company, based on a prudent assessment of the Pension Fund liabilities.
Funding arrangements
Under regulations, a funding valuation is required to take place every three years. If the valuation shows that the Pension Fund is in deficit, contributions to eliminate the deficit will be payable over an agreed period. Under the Schedule of Contributions agreed as part of the April 2023 actuarial valuation, the Company paid £275k per month until 28 February 2025 and ceased from that point.
In the previous April 2020 valuation, the trustees and employer also agreed a secondary funding objective, which is to be fully funded on an agreed low dependency basis by 5 April 2029. This secondary funding objective allows for contingency contributions to be paid if actual funding falls below expected funding development on the low dependency basis. This expected funding path is based on the funding position at April 2020 on the low dependency basis, the deficit contributions above and expected investment returns at the April 2020 valuation. Contingent contributions are £3.024k per annum increased by 3% per annum compound (with the first increase in April 2022) less any deficit recovery contributions. Contingent contributions are payable while actual funding is behind the expected development. There are currently no contingent contributions being paid.
Investment strategy
Pension Fund investments are in a broad range of asset classes, aimed at producing an acceptable level of risk whilst being able to meet the benefit payments due to Pension Fund members. Some of the Pension Fund’s investments are invested in “Liability Driven Investment” funds, which are designed to match the movements in Scheme liabilities as a result of changes to long-term interest rates and inflation expectations.
Risk exposure
Since the Pension Fund is a defined benefit arrangement, the benefits payable to fund members are not directly related to the amount of the assets. The Company is exposed to the risk of the Pension Fund’s assets being insufficient to meet the benefits and expenses payable. Risks arise due to uncertain future investment returns, future levels of inflation, and future changes to life expectancy. No amendments, curtailments, or settlements have occurred over the past year.
Employer-related assets
The value of the Pension Fund’s assets does not include any financial instruments issued by, or any property occupied by, or any other assets used by, the Company.
Assumed life expectations on retirement at age 65:
The amounts included in the balance sheet arising from the company's obligations in respect of defined benefit plans are as follows:
Note that the plan results in a surplus of £2,840k as at 31 December 2025 that the company hasn’t recognised due to their assessment that they don’t have an unconditional right to a surplus, corresponding to an asset ceiling of £0. Furthermore companies not having an unconditional right to a surplus can give rise to an additional liability under IFRIC14. The company should recognise the value of future deficit contributions but since contributions stopped in February 2025 this value is nil. Due to this the company has recognised the value as £0.
The defined benefit obligations arise from plans which are wholly or partly funded.
The actual return on plan assets was £3,113k (2024 - £1,562k).
The company's Group personal pension plan (GPPP) commenced in June 2007 and is a defined contribution scheme. Contributions made by the company are at varying rates between 3.5% and 12% of employees' pensionable salary, according to the rules of the scheme. Employees pay contributions varying between 3% and 5%. The members of the now closed defined benefits scheme have been invited to join a defined contribution scheme.
On 1 March 2023, a 3 year credit facility was agreed with Nordea Danmark, a branch of Nordea Abp, Finland. In February 2026, an amendment was made to the bank agreement reflecting the current market conditions and provide financing to focus on long-term value creation, expiring on 1 March 2028. As part of the agreement, there are cross company guarantees between some of the group companies. Those companies are:
H+H International A/S
H+H Polska Sp. Z.o.o.
H+H UK Limited
H+H Deutschland GmbH
There were no events after the reporting period end date which require disclosure.