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

The UK economy remained challenging during 2025. Although GDP grew by an estimated 1.3% and Bank Rate fell from 4.75% to 3.75%, borrowing costs remained relatively high and continued to weigh on consumer confidence, housing activity and investment. Construction output increased by 1.8% over the year but declined by 2.1% in the final quarter compared with the previous quarter, with weakness in both new work and repair and maintenance, particularly private housing.

Against this backdrop, the Group achieved strong revenue growth. Turnover increased by 7.4% to £140.87 million, compared with £131.18 million in 2024, with notable increases in both developer-related turnover and low-carbon product categories. Gross profit increased by 6.1% to £38.49 million, although the gross profit margin reduced slightly from 27.65% to 27.33%, reflecting competitive market conditions and changes in sales mix.

Operating expenses increased by 9.9% to £30.13 million, with staff costs rising by 13.8%, primarily due to higher performance-related remuneration, continued investment in the workforce, wage inflation and increased employer National Insurance costs from April 2025. Establishment and administrative costs also increased, including rent and rates, alongside broader inflationary pressures. Consequently, operating profit decreased by 16.3% to £8.28 million, while profit before taxation was £8.43 million, compared with £9.96 million in the previous year.

Despite these pressures, the Group maintained a strong financial position, with net current assets of £28.87 million and total net assets of £37.61 million at the year end, providing a sound platform for continued investment and controlled long-term growth.

During the year, the Group continued to invest in its branch network, operational capability and low-carbon offering. This included opening new Daikin Sustainable Home Centres at Bradford and Portishead, completing selected branch improvements, strengthening management capability and investing in the commercial vehicle fleet. The Group also maintained its focus on commercial and operational efficiency.

The Directors consider the Group’s performance during 2025 to be satisfactory, particularly given continued competitive pressure, weakness in parts of the residential construction market and significant increases in employment and other operating costs.

Future developments and outlook

The outlook for the construction and merchanting sectors remains uncertain. Although lower interest rates may support housing activity and consumer confidence over time, the timing and extent of any recovery in residential new-build and repair, maintenance and improvement activity remain difficult to predict.

The Group’s strategy will continue to focus on controlled organic growth, high standards of customer service, disciplined margin management and maintaining a strong financial position. Key priorities will include sustaining high levels of stock availability, improving digital channels and the overall customer offering, continuing to invest in and improve the branch network, and expanding the Group’s low-carbon product, training and customer-support offering.

Management will also continue to focus on operational efficiency and closely monitor commercial performance, working capital and operating costs to support the Group’s long-term resilience and growth.

The Group’s operations expose it to a range of commercial, operational and financial risks. The Board regularly reviews the principal risks facing the Group and the measures in place to manage them.

Market conditions and competition

Demand for the Group’s products is influenced by activity in the residential new-build, repair, maintenance and improvement, commercial construction and renewable heating markets. Economic uncertainty, interest rates and reduced consumer or developer confidence may adversely affect demand.

The market remains highly competitive, which can place pressure on selling prices and gross margins. The Group manages these risks through close monitoring of market conditions, branch and product performance, pricing discipline, customer service and active management of its product mix.

Supply chain and pricing risk

The availability and cost of products may be affected by supplier capacity, transportation disruption, commodity prices, currency movements, geopolitical instability and international trade measures.

The Group maintains close relationships with its key suppliers, monitors product availability and pricing developments and seeks alternative sources of supply where appropriate. The strengthening of the purchasing function during 2025 provides additional support in managing these risks.

Credit risk

The Group provides credit facilities to a significant number of customers and is therefore exposed to the risk of customers failing to pay amounts when due.

Credit risk is managed through customer credit checks, appropriate credit limits, ongoing account monitoring, debt collection procedures and the use of credit insurance where considered appropriate.

People, employment costs and health and safety

The Group’s continued success depends upon attracting, developing and retaining employees with the appropriate skills and experience. Increased employment costs and competition for suitably qualified employees may place additional pressure on the cost base.

The Group seeks to mitigate these risks through appropriate remuneration, supporting employees in their roles, recruiting apprentices where suitable, planning for continuity in key positions and maintaining a positive and safe working environment.

The health and safety of employees, customers and other persons affected by the Group’s operations remains a key priority. Particular attention is given to warehouse operations, material handling and the safe delivery of large and heavy products, including air source heat pumps.

Information technology and cybersecurity

The Group is dependent upon the continued availability and security of its information technology systems. System failure, cyberattack or loss of data could disrupt operations and result in financial or reputational damage.

The Group continues to invest in appropriate technology, data security, system resilience, backups, access controls and employee awareness.

Liquidity and working capital

The Group must maintain sufficient financial resources to meet its obligations and support its operations and future investment.

Cash flow, stock, debtors, creditors and financial forecasts are monitored regularly. The Group’s strong balance sheet and net current asset position provide resilience against fluctuations in trading conditions.

The Directors consider a range of different performance indicators in assessing its operations. The key financial performance indicators during the period were as follows:

                                2025        2024

                                £ £

Turnover                         140,873,156 131,183,616

Turnover Growth                            7.39%        -0.90%

Gross Profit %                            27.33%        27.65%

Profit before Taxation                        8,434,363    9,964,715

Net Profit %                            4.30%        5.62%    

Stock Turnover Days                        74        76

The Group regularly monitors sales and gross margin by product, product category, manufacturer and branch. Management also reviews staff costs, stock levels, customer credit exposure, operating expenses and branch contribution.

The Directors consider, both individually and collectively, that they have acted in good faith in the way most likely to promote the success of the Group for the benefit of its members as a whole, having regard to the matters set out in section 172(1)(a) to (f) of the Companies Act 2006.

The following sections explain how the Directors had regard to these matters during the year.

a. The likely consequences of decisions in the long term

During 2025, the Board continued to support the Group’s long-term strategy through targeted investment in its operations, people and customer offering. This included completing the solar installation at the Burnley head office, improving selected branches, strengthening management capability, investing in the commercial vehicle fleet and opening new Daikin Sustainable Home Centres at Bradford and Portishead.

In making these decisions, the Board considered their expected contribution to operational efficiency, customer service, profitability and the long-term resilience of the business.

b. The interests of the Group’s employees

Employees are central to the Group’s success and the delivery of high standards of customer service. The Board seeks to provide a safe, supportive and fair working environment in which employees are appropriately rewarded and able to develop their skills and potential.

The Group continues to review pay and benefits, support employees in their roles, plan for continuity in key positions and promote employee health, safety and wellbeing.

c. The need to foster the Group’s business relationships with suppliers, customers and others

Customers are at the heart of the business. The Group seeks to maintain close relationships with its customers, understand their requirements and provide high levels of product availability, technical support and customer service.

Strong supplier relationships remain essential to obtaining the right products at competitive prices and maintaining product availability. The Group works closely with its suppliers, communicates expected requirements and seeks to pay suppliers in accordance with agreed terms.

d. The impact of the Group’s operations on the community and the environment

The Group supports the communities in which it operates by providing employment and apprenticeship opportunities where appropriate.

The Group remains committed to reducing its environmental impact. During 2025, the solar installation at the Burnley head office became operational, reducing the site’s reliance on electricity supplied from the national grid. The Group also continued to promote paperless working, recycling, energy-efficient lighting and responsible fleet investment.

The opening of the Bradford and Portishead Daikin Sustainable Home Centres supports installer training and greater awareness of lower-carbon heating technologies.

e. The desirability of the Group maintaining a reputation for high standards of business conduct

The Group seeks to conduct its business with integrity, fairness and professionalism. Its policies and procedures are designed to support compliance with applicable legal and regulatory requirements and high standards of conduct in dealings with employees, customers, suppliers and other stakeholders.

The Board recognises that maintaining stakeholder trust and protecting the Group’s reputation are fundamental to its long-term success.

f. The need to act fairly as between members of the Group

The Board considers the interests of the Group’s members when making decisions and seeks to ensure that they are treated fairly.

Performance information and financial results are made available to members, and the Board seeks to ensure that its decisions remain consistent with the Group’s strategy, values and long-term objectives.

On behalf of the board

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

The principal activity of the company and group continued to be that of wholesale plumbers' merchants.

The results for the year are set out on page 12.

Ordinary dividends were paid amounting to £10,000,533. The directors do not recommend payment of a further dividend.

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

The group and company finances its operations through a mixture of retained profits, and where necessary to fund expansion or capital expenditure programmes through bank borrowing.

The management's objectives are to:

• retain sufficient liquid funds to enable it to meet its day to day obligations as they fall due whilst maximising

returns on surplus funds;

• minimise the group's and company's exposure to fluctuating interest rates when seeking new borrowings; and

• match the repayment schedule of any external borrowings or overdrafts with the expected future cash flows expected to arise from the company's trading activities.

As the group and company funds are invested in sterling bank deposit accounts there is no exchange rate risk exposure. The group and company funds are held primarily in short term variable deposit accounts. The directors believe that this gives them the flexibility to release cash resources at short notice and also allows them to take advantage of changing conditions in the finance markets as they arise.

Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

The group manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the group has sufficient liquid resources to meet the operating needs of the business.

Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the group continues and that the appropriate training is arranged. It is the policy of the group that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.

The group's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.

Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the group's performance.

The group has followed the 2019 HM Government Environmental Reporting Guidelines. The group has also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for Company Reporting

To compare the emissions efficiency of the business year on year as the business changes, metrics have been used to analyse emissions and to measure progress. These intensity metrics consider the growth of the business and act as a measure of business performance and emissions. The company have utilised the revenue during the financial year to determine the tonnage of CO2 (equivalent) per £1,000,000 generated as the intensity ratio.

The company continues to invest in greener working practices in our ongoing review of our vehicle fleet, including cars, delivery vans and delivery wagons.

LED lighting continues to be installed across the company where it is required to improve energy efficiency.

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

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

• select suitable accounting policies and then apply them consistently;

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

• state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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

We have audited the financial statements of James Hargreaves PM Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2025 which comprise the group profit and loss account, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

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

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and 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 other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

• The information given in the strategic report and the directors' report for the financial 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 the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

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

• adequate accounting records have not been kept 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.

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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 parent company or to cease operations, or have no realistic alternative but to do so.

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

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.

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

• Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud; 

• Reviewing minutes of meetings of those charged with governance;

• Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the entity through enquiry and inspection; 

• Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;

• Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias. 

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 or non-compliance with regulation.  This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.  The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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.

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £9,841,147(2024 - £7,246,816. profit).

James Hargreaves PM Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Todmorden Road, Burnley, Lancashire, BB11 3JT.

The group consists of James Hargreaves PM Limited and all of its subsidiaries.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company has taken advantage of the Reduced Financial Reporting Regime, as permitted by FRS102 regarding the disclosure requirements of Sections 3, 4, 7, 11, 12 and 33 of the standard. This information is included in the consolidated financial statements herein from a group perspective.

The consolidated group financial statements consist of the financial statements of the parent company James Hargreaves PM Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

All financial statements are made up to 31 December 2025. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 5 years.

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

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

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

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

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 recognised in the profit and loss account.

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

Provisions are made against slow moving, obsolete and surplus stock.

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

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

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

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs.

CFDs are derivative financial instruments which are initially recognised at fair value on the date the contract is entered into. At each reporting date open trades are remeasured at fair value. Changes in fair value are recognised in the profit and loss. Broker deposited funds are held as cash equivalents in the balance sheet.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group 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 group after deducting all of its liabilities.

Basic financial liabilities, including creditors and loans from fellow group companies are recognised at transaction price.Financial liabilities classified as payable within one year are not amortised.

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.

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

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

In the application of the group’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.

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

There is a degree of estimation uncertainty in relation to the calculation of the group's stock provision. When calculating the stock provision, management considers the age, nature and condition of the stock as well as applying assumptions around saleability of stock in the future.

The group makes an estimate of the recoverable value of trade and other debtors. When assessing the impairment of trade and other debtors, management considers factors including the ageing profile of trade debtors and past experience. For balances which management deem to be irrecoverable, a provision is made in the financial statements against these balances.

Determination of whether leases entered into by the group as lessee are operating or finance leases. These decisions depend on an assessment of whether the risks and rewards of ownership have been transferred from the lessor to the lessee on a lease by lease basis.

In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment. At the year end, management review the financial performance of its subsidiaries to ensure that no impairment is required.

The average monthly number of persons (including directors) employed by the group and company during the year was:

Their aggregate remuneration comprised:

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

Details of the company's subsidiaries at 31 December 2025 are as follows:

Other loans are unsecured, accrue interest at the applicable base rate of 3.75% per annum at the reporting date, and are repayable on demand.

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

Other reserves - This reserve records the impact of a historic increase in equity arising from merger accounting.

Profit and loss account - This reserve records retained earnings and accumulated losses, less equity dividends paid.

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

The company's immediate parent company is Solarshake Investimentos Unipessoal LDA, incorporated in Portugal.

The ultimate controlling party is Mr G J Rothwell.