REGISTERED NUMBER: 00982615 (England and Wales)

Strategic Report, Report of the Director and

Audited Financial Statements

for the Year Ended 31 December 2025

for

Mavala (U.K.) Limited

Page

Company Information

1

Strategic Report

2

Report of the Director

5

Report of the Independent Auditors

7

Statement of Comprehensive Income

11

Statement of Financial Position

12

Statement of Changes in Equity

13

Statement of Cash Flows

14

Notes to the Statement of Cash Flows

15

Notes to the Financial Statements

17

DIRECTOR:

J Hodge

REGISTERED OFFICE:

Beechey House

87 Church Street

Crowthorne

Berkshire

RG45 7AW

REGISTERED NUMBER:

00982615 (England and Wales)

SENIOR STATUTORY AUDITOR:

Yvonne Miles FCCA

AUDITORS:

PKB Accountants Limited

Chartered Certified Accountants

Statutory Auditor

Beechey House

87 Church Street

Crowthorne

Berkshire

RG45 7AW

The director presents his strategic report for the year ended 31 December 2025.

REVIEW OF BUSINESS

Mavala (UK) Ltd experienced a challenging financial year in 2025, culminating in a significant loss. This decline in performance was driven by a combination of lost sales across major accounts, underperformed in several sales territories, and increased operational costs.

Financial Performance

The Company generated sales of £2,627,768 during the year, supported by the recovery of key customer accounts, enhanced sales coverage, and continued investment in product innovation.

Gross profit increased to £1,490,289 from £1,438,957 in the prior year, maintaining a strong gross margin and demonstrating the resilience of the Company's product portfolio.

Operating losses reduced substantially from £238,358 in 2024 to £102,407 in 2025, representing an improvement of over 40%. This was achieved despite continued investment in sales development, marketing activity, digital infrastructure, and product launches.

Although the Company achieved a significant reduction in losses during the year, a loss was still recorded. The principal factors contributing to the result were continued strategic investments in the development of the business. During 2025, the Company expanded and strengthened its sales force, resulting in increased employment costs as additional resources to improve customer service and sales growth opportunities.

The Company also maintained substantial investment in brand development, merchandising, public relations, exhibitions and promotional activities to strengthen consumer awareness and support retail partners. In addition, investment continued in software platforms, digital infrastructure and e-commerce capabilities as part of the Mavala's wider digital transformation programme.

The Company's cash position strengthened significantly during the year, increasing from £159,397 to £741,760. This improvement was supported by positive operating cash generation, disciplined stock management, and the strategic disposal of surplus property assets.

Contributing Factors to the Loss

Whilst sales and gross profit increased during the year, these improvements were not yet sufficient to fully absorb the Company's operating cost base and strategic growth investments. However, the significant reduction in losses, together with improved cash generation and stronger operational performance, demonstrates that management's recovery initiatives are delivering positive results and are expected to support future profitability.

Organisational Response

Mavala (U.K.) Limited continued its recovery and transformation programme throughout 2025, building on the corrective actions implemented during 2024. Whilst the Company reported a loss for the year, performance improved significantly compared with the previous period, demonstrating the effectiveness of management's strategic initiatives and providing a strong platform for future growth.

We are actively pursuing all reasonable measures to improve profitability. These include implementing price increases, reviewing operating costs, identifying savings opportunities, strengthening our digital presence, optimising website performance, increasing direct sales activity, and improving operational efficiencies.

Product Development and Strategic Initiatives

Product Innovation and Brand Development

Innovation remains central to Mavala's growth strategy. During the year, the Company continued to expand and strengthen its product portfolio through investment in new product development and category enhancement and POS.

Recent further additions to the makeup range, including Dream foundations and LipOil's have broadened the Company's consumer offering and strengthened its position within the beauty and personal care sector.

The Company has also invested in product training, marketing materials, and brand development initiatives to ensure that retail partners and consumers are supported by modern, engaging product communications.

Strategic Asset Rationalisation

During 2025, the Company completed the sale of its freehold property, generating proceeds of £500,000 and a profit on disposal of £67,979.

This transaction formed part of a wider strategic asset rationalisation programme designed to improve liquidity, strengthen the balance sheet, and allow management to focus resources on the Company's core commercial activities. The disposal has significantly enhanced cash reserves and provides additional financial flexibility to support future growth initiatives.

Sales Recovery and Commercial Development

Following the challenges experienced during 2024, management continued the restructuring of the sales organisation throughout 2025. The revised sales structure has improved market coverage, strengthened customer relationships, and increased accountability across all territories.

The Company maintains a strong and diversified customer portfolio, reducing reliance on individual accounts and providing a stable revenue base. Existing customer relationships remain strong, while management continues to pursue opportunities to expand distribution and secure new retail partnerships.

Particular focus has been placed on improving service levels, strengthening account management, and increasing promotional activity with key retail partners to support long-term sales growth.

Digital Transformation and E-Commerce

A key strategic priority remains the Company's digital transformation programme.

Investment has continued at pace in technology, software, and digital infrastructure to improve operational efficiency and support future growth. The launch of a direct-to-consumer e-commerce platform provides an additional growing sales channel, enabling the Company to engage directly with consumers while improving margin performance through sales at recommended retail pricing.

The development of digital marketing capabilities and online promotional programmes is expected and will enhance brand visibility, increase customer engagement, and diversify revenue streams.

Inventory Management and Operational Efficiency

The Company continued to improve inventory management during the year, reducing stock levels from £660,986 to £537,547 while maintaining service levels to customers.

This reduction has improved working capital efficiency, reduced stock-holding risk, and enhanced cash flow generation. Management remains focused on maintaining optimal inventory levels and aligning purchasing activity with sales demand.

Operational efficiency programmes have also contributed to tighter cost control and improved resource allocation across the business.

PRINCIPAL RISKS AND UNCERTAINTIES

The principle risks to the company is retaining key personnel and the competitiveness of the product range

in a consumer driven market. It is essential to have experienced and knowledgeable employees to support

the future goals and growth of the business.

KEY PERFORMANCE INDICATORS

The directors consider that the key performance indicators are: orders, revenue, gross profit, delivery capacity, cost base, debtors, creditors and cash.

FINANCIAL KEY PERFORMANCE INDICATORS

The gross margin percentage for 2025 is 56.71% compared to 2024 is 58.61% .

ON BEHALF OF THE BOARD:

J Hodge - Director

8 September 2026

The director presents his report with the financial statements of the company for the year ended 31 December 2025.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of marketing cosmetic products.

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2025.

DIRECTORS

J Hodge has held office during the whole of the period from 1 January 2025 to the date of this report.

Other changes in directors holding office are as follows:

H Maute ceased to be a director after 31 December 2025 but prior to the date of this report.

GOING CONCERN

The company has prepared budgets and forecasts that cover the period of 12 months from the date of the financial statements being authorised for issue in order to assess going concern It is anticipated that the company's level of activity will remain fairly constant over that period with similar results being attained in line with the current trading period. The company has also sought comfort from it parent company that they will provide financial support should it be required. At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The directors are confident that the Company will have sufficient funds to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and consequently have prepared the financial statements on a going concern basis.

DIRECTOR'S RESPONSIBILITIES STATEMENT

The director is responsible for preparing the Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the director must not approve the financial statements unless he is 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 director is required to:

-	select suitable accounting policies and then apply them consistently;

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

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

The director is 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 him to ensure that the financial statements comply with the Companies Act 2006. He is 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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and he 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 company's auditors are aware of that information.

AUDITORS

In accordance with section 485 of the Companies Act 2006, a resolution for the re-appointment of PKB Accountants Limited as auditors of the company is to be be proposed at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

J Hodge - Director

8 September 2026

Opinion

We have audited the financial statements of Mavala (U.K.) Limited (the 'company') for the year ended 31 December 2025 which comprise the Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement of Cash Flows, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 December 2025 and of its loss for the year then ended;

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

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

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 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 director's 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 director with respect to going concern are described in the relevant sections of this report.

Other information

The director is responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Director, 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 Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Director 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 company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Director.

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, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of director's remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

In light of our knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Report of the Directors.

Responsibilities of director

As explained more fully in the Director's Responsibilities Statement set out on page five, the director is 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 director determines 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 director is responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the director either intends to liquidate the company or to cease operations, or has 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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect irregularities, including fraud. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management.

. We obtained an understanding of the legal and regulatory frameworks that are applicable to the company and determined that the most significant are those that relate to the Health and Safety Regulations, the reporting framework FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland", Companies Act 2006, Bribery Act 2010, Money Laundering regulations and relevant tax compliance regulations in the United Kingdom.

. Other indirect laws and regulations that have an impact on the financial statements are the compliance with relevant employment law, health and safety regulations and the UK General Data Protection Regulation (UK GDPR).

. We understood how Mavala UK Limited is complying with those frameworks by making enquiries of management and those responsible for legal and compliance procedures. We corroborated our enquiries through the review of the following documentation or completion of the following procedures:

. Review of accounting policies and completion of a disclosure checklist to assess compliance with FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and Company law requirements;

. Review of any relevant correspondence with local tax authorities; and

. Review of any relevant correspondence received from regulatory bodies

. We assessed the susceptibility of the company's financial statements to material misstatement, including how fraud might occur by holding a discussion within the audit team which included identification of related parties, understanding the company's business, the control environment and assessing the inherent risk for relevant assertions at the significant account level. We also held discussions with management and those charged with governance to gain an understanding of those areas of the financial statements which are susceptible to fraud, as identified by management. Following these procedures, we identified a risk of management override of control and risk of inappropriate revenue recognition. We gained an understanding of the entity level of controls and policies that the company applies.

. Based on this understanding we designed our audit procedures to identify noncompliance with such laws and regulations. Our procedures involved testing of journal entries, with focus on journals indicating large or unusual transactions, or meeting our defined risk criteria based on our understanding of the business, reviewing accounting estimates for evidence of management bias and enquiries of senior members of the management team regarding their knowledge of any instances of non-compliance with laws and regulations that could impact the financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our 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.

Yvonne Miles FCCA (Senior Statutory Auditor)

for and on behalf of PKB Accountants Limited

Chartered Certified Accountants

Statutory Auditor

Beechey House

87 Church Street

Crowthorne

Berkshire

RG45 7AW

22 September 2026

TURNOVER

2,627,768

2,455,293

Cost of sales

1,137,479

1,016,336

GROSS PROFIT

1,490,289

1,438,957

Distribution costs

1,134,381

1,135,460

Administrative expenses

458,315

541,855

1,592,696

1,677,315

OPERATING LOSS

4

(102,407

)

(238,358

)

Interest receivable and similar income

2,419

2,157

(99,988

)

(236,201

)

Interest payable and similar expenses

5

1,952

1,176

LOSS BEFORE TAXATION

(101,940

)

(237,377

)

Tax on loss

6

(41,497

)

(12,784

)

LOSS FOR THE FINANCIAL YEAR

(60,443

)

(224,593

)

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(60,443

)

(224,593

)

FIXED ASSETS

Intangible assets

7

32,223

15,760

Tangible assets

8

24,121

475,515

56,344

491,275

CURRENT ASSETS

Stocks

9

537,547

660,986

Debtors

10

443,876

400,029

Cash at bank and in hand

741,760

159,397

1,723,183

1,220,412

CREDITORS

Amounts falling due within one year

11

1,319,205

1,144,821

NET CURRENT ASSETS

403,978

75,591

TOTAL ASSETS LESS CURRENT LIABILITIES

460,322

566,866

CREDITORS

Amounts falling due after more than one year

12

(6,819

)

(11,423

)

PROVISIONS FOR LIABILITIES

15

(14,086

)

(55,583

)

NET ASSETS

439,417

499,860

CAPITAL AND RESERVES

Called up share capital

16

600,000

600,000

Retained earnings

17

(160,583

)

(100,140

)

SHAREHOLDERS' FUNDS

439,417

499,860

The financial statements were approved by the director and authorised for issue on 8 September 2026 and were signed by:

J Hodge - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2024

600,000

124,453

724,453

Changes in equity

Total comprehensive income

-

(224,593

)

(224,593

)

Balance at 31 December 2024

600,000

(100,140

)

499,860

Changes in equity

Total comprehensive income

-

(60,443

)

(60,443

)

Balance at 31 December 2025

600,000

(160,583

)

439,417

Cash flows from operating activities

Cash generated from operations

1

99,460

(84,010

)

Interest paid

(611

)

-

Interest element of hire purchase payments paid

(1,341

)

(1,176

)

Tax paid

17,545

(16,989

)

Net cash from operating activities

115,053

(102,175

)

Cash flows from investing activities

Purchase of intangible fixed assets

(19,193

)

-

Purchase of tangible fixed assets

(4,345

)

(6,962

)

Sale of tangible fixed assets

492,014

-

Interest received

1,863

2,102

Net cash from investing activities

470,339

(4,860

)

Cash flows from financing activities

Capital repayments in year

(4,128

)

(5,470

)

Amount withdrawn by directors

1,099

(1,546

)

Net cash from financing activities

(3,029

)

(7,016

)

Increase/(decrease) in cash and cash equivalents

582,363

(114,051

)

Cash and cash equivalents at beginning of year

2

159,397

273,448

Cash and cash equivalents at end of year

2

741,760

159,397

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

31.12.25

31.12.24

£

£

Loss before taxation

(101,940

)

(237,377

)

Depreciation charges

34,433

32,321

Profit on disposal of fixed assets

(67,979

)

-

Finance costs

1,952

1,176

Finance income

(2,419

)

(2,157

)

(135,953

)

(206,037

)

Decrease in stocks

123,439

3,538

(Increase)/decrease in trade and other debtors

(61,935

)

138,558

Increase/(decrease) in trade and other creditors

173,909

(20,069

)

Cash generated from operations

99,460

(84,010

)

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 December 2025

31.12.25

1.1.25

£

£

Cash and cash equivalents

741,760

159,397

Year ended 31 December 2024

31.12.24

1.1.24

£

£

Cash and cash equivalents

159,397

273,448

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.1.25

Cash flow

At 31.12.25

£

£

£

Net cash

Cash at bank and in hand

159,397

582,363

741,760

159,397

582,363

741,760

Debt

Finance leases

(15,525

)

4,128

(11,397

)

(15,525

)

4,128

(11,397

)

Total

143,872

586,491

730,363

1.	STATUTORY INFORMATION

Mavala (U.K.) Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£).

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Going Concern

The company has prepared budgets and forecasts that cover the period of 12 months from the date of the financial statements being authorised for issue in order to assess going concern It is anticipated that the company's level of activity will remain fairly constant over that period with similar results being attained in line with the current trading period. The company has also sought comfort from it parent company that they will provide financial support should it be required. At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The directors are confident that the Company will have sufficient funds to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and consequently have prepared the financial statements on a going concern basis.

Significant judgements and estimates

In the application of the Company's accounting policies, management is required to make judgements, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and underlying 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future period.

a) Critical judgements in applying the entity's accounting policies

(b) Critical accounting estimates and assumptions

The company makes estimates and assumptions concerning the future. The resulting accounting estimates will seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below:

(i) Useful economic lives of tangible assets

The annual depreciation charge for tangible assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates based on physical condition and economic utilisation of the assets. See note 6 for the carrying amount of the assets and the accounting policies note Tangible Fixed Assets for the useful economic lives of each class of asset.

(ii) Impairment of debtors

The company makes an estimate of the recoverable value of trade and other debtors. When assessing impairment of trade and other debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience. See note 10 for the net carrying amount of the debtors.

(iii) Accruals

The company makes an estimate for potential sums payable to Agents in accordance with the EU Directive on Agents compensation. The provision is amended anually to take account of changes in the year.

Revenue recognition

Turnover is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods supplied and services rendered, stated net of discounts and of Value Added Tax.

Revenue from the sale of goods is recognised when :-

The Company has transferred to the buyer the significant risks and rewards of ownership of the goods

The Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold

The amount of revenue can be measured reliably

It is probable that the economic benefits associated with the transaction will flow to the Company

The costs incurred or to be incurred in respect of the transaction can be measured reliably.

Intangible assets

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Computer software is being amortised evenly over its estimated useful life of ten years.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Freehold property

-

Straight line over 20 years

Fixtures and fittings

-

20% on cost

Motor vehicles

-

20% on cost

Computer equipment

-

33% on cost

Land and buildings include a freehold factory. Land and buildings are carried at their revalued amounts, being fair value at the date of valuation less subsequent depreciation and impairment losses. Revaluations are performed by professional qualified valuers with sufficient regularity to ensure that the carrying amounts do not differ materially from those that would be determined using fair values at the end of each reporting period. Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the assets and the net amount is restated to the revalued amount.

Any revaluation increase or decrease in the carrying amount of land and buildings is recognised in other comprehensive income and included in a revaluation reserve. Any difference between depreciation on the carrying amount as opposed to the cost is transferred from the revaluation reserve to retained earnings.

All other assets are stated at cost less accumulated depreciation and impairment losses.

At each balance sheet date, the Company reviews the carrying amounts of its tangible fixed assets to determine whether there is any indication that any items have suffered an impairment loss. If any such indication exists, the recoverable amount of an asset is estimated in order to determine the extent of the impairment loss, if any.

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. The Impairment loss is recognised as an expense immediately.

Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined ( net of depreciation ) had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised as income immediately.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Costs, which comprise direct production costs, are based on the first-in-first-out valuation basis. Overheads are charged to profit and loss as incurred. Net realisable value is based on the estimated selling price less any estimated completion or selling costs.

When stocks are sold, the carrying amount of those stocks is recognised as an expense in the period in which the related revenue is recognised. The amount of any write-down of stocks to net realisable value and all losses of stocks are recognised as an expense in the period in which the write-down or loss occurs. The amount of any reversal of any write-down of stocks is recognised as a reduction in the amount of stocks recognised as an expense in the period in which the reversal occurs.

Taxation

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

Current Tax

The tax currently payable is based on taxable profit for the year. Taxable profits differs from net profit as reported in the profit and loss account as 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 company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting date.

Deferred Tax

Deferred tax is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. The deferred tax balance has not been discounted.

Foreign currencies

Transactions in currencies other than the functional currency of the Company are recorded at the rate of exchange on the date the transaction occurred. Monetary items denominated in other currencies are translated at the rate prevailing at the end of the reporting period. All differences are taken to the statement of comprehensive income. Non-monetary items that are measured at historic cost in a foreign currency are not retranslated.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability.

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to the profit and loss over the relevant period. The capital element of the future payments is treated as a liability.

Other leases that do not transfer substantially all the risks and rewards of ownership of the leased assets are classified as operating leases.

Pension costs and other post-retirement benefits

Defined contribution pension plan

The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further payment obligations.

The contributions are recognised as an expense in the income statement when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the company in independently administered funds.

Employee benefits

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.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand and depositis held at call with banks.

Finance costs

Finance costs are charged to the Income Statement over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

Financial instruments

The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.

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

Loans and Receivables

Trade debtors, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as 'loans and receivables'. Loans and other receivables are measured at amortised cost using the effective interest method,less any impairment.

Interest is recognised by applying the effective interest rate, except for short term receivables when the recognition of interest would be immaterial. The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument to the net carrying amount on initial recognition.

Trade debtors with no stated interest rate and receivable within one year are recorded at a transaction price. Any losses arising from impairment are recognised in the income statement in any other administrative expenses.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. The impairment loss is recognised in the income statement.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the 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

Basic financial liabilities, including trade and other payables, bank loans, loans from fellow group companies are 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 receipts discounted at a market rate of interest.

Debt instruments are subsequently carried at amortised costs, using the effective interest rate method.

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts 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 payables with no stated interest rate or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the income statement in administrative expenses.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company's contractual obligations expire or are discharged or cancelled.

Equity instruments

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

Interest income

Interest income is recognised in the Income Statement using the effective interest method.

3.	EMPLOYEES AND DIRECTORS

31.12.25

31.12.24

£

£

Wages and salaries

607,899

555,320

Social security costs

70,754

60,127

Other pension costs

40,967

39,207

719,620

654,654

The average number of employees during the year was as follows:

31.12.25

31.12.24

Director

1

1

Office and Management

5

6

Selling and Distribution

9

10

15

17

31.12.25

31.12.24

£

£

Directors' remuneration

95,985

93,823

Directors' pension contributions to money purchase schemes

9,256

9,090