Registered number:
FOR THE YEAR ENDED 31 DECEMBER 2025
WALKER BOOKS LIMITED
CONTENTS
WALKER BOOKS LIMITED
COMPANY INFORMATION
Page 1
WALKER BOOKS LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2025
The directors present their strategic report on the group for the year ended 31 December 2025. The principal activity of the company and the group during the year was that of book publishers.
Business review
Turnover for the year ended 31 December 2025 increased by 0.4% (2024: decrease of 7.8%), predominately driven by an increase in the group's overseas markets.
The gross profit margin has decreased slightly to 37.9% (2024: 38.2%) due to change in group sales mix.
The group made an operating profit of £87,000 (2024: operating loss of £940,000), primarily due to a decrease in distribution costs and increase in other operating income from service charges receivable. The group made an overall loss for the year, after tax, of £605,000 (2024: £1,986,000).
The financial position of the group remains strong despite net assets falling to £37,320,000 (2024: £39,012,000), the fall reflecting the loss after tax and foreign currency impacts of operations in the group’s overseas subsidiaries.
Net current assets have decreased to £35,538,000 (2024: £36,739,000) due to the losses incurred.
2025 was a challenging year for the Group, driven by market headwinds in most of our key global markets, especially the United States. We continue to take action to reduce costs over the course of the year, leading to some one time exceptional costs and a reduction in recurring operating costs going forward.
Following key leadership and strategic changes that began in earnest in 2023, we will begin to see a stronger, more focused publishing programme beginning in 2026 and a more resilient business. This coincides with the exciting releases of TV, film and merchandise opportunities to further diversify and benefit the Group and its creators. Maisy and Friends TV/streaming season one has been produced and sold to major broadcasters in the US, UK and China, with more deals in the pipeline. Season one is airing in the UK and China in the first half of 2026, and is expected to materially drive sales of the classic and tie in the Maisy Book brand, as well as significantly energising licensing opportunities and revenues for the brand.
During 2025 the Senior Leadership team undertook a full cost review of the group’s business worldwide. Significant current and forward payroll and associated savings have been made, with the project anticipated to end during 2026. The leadership team also approved a package of production and manufacturing measures that are expected to add significant additional gross profit margin across all the group businesses going forward.
During 2025 Walker Books Limited successfully went live (1st May 2025) with its new warehousing and distribution partner, Harper Collins UK. In March 2026 Walker Books Limited entered into a new asset based lending facility with HSBC, which complements the existing flexible overdraft facility already in place. The facilities provide on going liquidity to the business, in addition to the support provided by the wider group.
Principal risks and uncertainties
The group's borrowings, foreign exchange exposure and banking relationships are managed at group level. The following policies have been applied to manage the financial risk faced by the group:
∙Liquidity risk: The group maintains a rolling 12 month cash forecast of requirements, reserves, and facilities, which is reviewed regularly by the directors. The board considers the resources of the group to be fully adequate for its foreseeable needs.
∙Currency rate exposure: At the group level US dollar receipts are matched with US dollar payments to cover supplier costs. The group is exposed to the risks of exchange rate fluctuations due to significant proportions of its operations being conducted in other parts of the world.
∙Credit risk: The company manages its credit risk by establishing credit limits for customers. Candlewick Press Inc., Walker Books Limited and Walker Books Australia PTY Limited use local distributors who are responsible for performing invoicing and debt collection.
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WALKER BOOKS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Competitors
The group acquires exclusive World or English language rights whenever possible in order for the group to maximise the potential in all relevant markets. The group position is based on product quality, brand image and competitive pricing. There is regional competition from other publishers' products in all markets.
Environment
The directors have provided details in respect of their environmental policies in the narrative in the S172 statement, as shown on page 4.
Future developments
The intention of the directors is to continue the development of the group's product offering using existing strategies and to expand Walker's market reach while continuing to respond with efficacy to future regulation and suggested best practices, including, for example, adhering to UK government trade sanctions in support of maintaining international peace and security.
Legal proceedings
The company and its group has, to its knowledge, no undeclared legal proceedings against it.
Risk assessment
The group has a wide diversification of customers and sales channels. The group has built up strong relationships with its customers but is not over reliant on any single customer.
Statement by the directors on performance of their statutory duties in accordance with S172 (1) Companies Act 2006
The board of directors of Walker Books Limited have considered, both collectively and individually, that they have acted in a way they consider that, in good faith, would be mostly likely to promote the success of the group for its member and its stakeholders a whole. The directors have considered the requirements of Section 172 (1)(a) to (f) as follows:
a) The likely consequences of any decision in the long term
The directors consider the medium and long term impact of decisions when formulating plans and strategic direction for the company. The directors set long term plans in agreement with the company's members, with annual forecasts and reforecasts in the event of material changes in circumstances being prepared.
b) The interests of the company's employees
The directors consider our people to be our greatest asset and the interests of our employees are always taken into consideration in the decisions that are made. An "open" environment is encouraged and the company aims to be a responsible employer in its approach to employee matters including pay and benefits, diversity and inclusion, training, development and career opportunities.
The group has continued its policy regarding the employment of disabled persons. Full and fair consideration is given to applicants for employment made by disabled persons having regard to their particular aptitude and abilities.
The group's policy is to consult and discuss with employees matters likely to affect employees' interests.
Information on matters of concern to employees is given through reports which seek to achieve a common awareness of factors affecting the group's performance.
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WALKER BOOKS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Statement by the director on performance of his statutory duties in accordance with S172 (1) Companies Act 2006 (continued)
c) The need to foster the company's business relationships with suppliers, customers and others
Management work closely with our clients to ensure they are kept abreast of the broad investment strategy for the short and medium term. Management work closely with suppliers to build long term relationships and common goals. Our aim is to work with our suppliers in an environment that reflects the values and behaviours we would expect from our own people, including ensuring they adhere to our strict anti bribery and corruption policies. The directors endeavour to ensure that credit terms are met.
d) The impact of the company's operations on the community and environment
The directors are mindful of the business impact on the general community and the society we operate within. The directors regularly consider our environmental impact, and seek to reduce wherever possible our environmental footprint. The company operates an ethical and environmental policy to reduce any adverse impact that may be caused by its activities.
The company is a (founding) member of PREPS, an initiative to share information on the source of paper supplies, to promote the use of sustainable forestry products within the supply chain. The company complies with safety testing regulations on its products and promotes recycling and other initiatives in the office environment.
e) The desirability of the company maintaining a reputation for high standards of business conduct
The directors believe it is crucial that the company is trusted by all stakeholders to maintain the highest standards in business and corporate governance. The intention is to behave responsibly and ensure that management operate the business in an accountable manner and, in doing so, will contribute to the continued success of the company.
f) The need to act fairly as between members of the company
The directors consider the declaration of a dividend on an annual basis after taking into account the interests of the members, the results of the company and the financial position of the company.
This report was approved by the board and signed on its behalf.
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WALKER BOOKS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2025
The directors present their report and the financial statements for the year ended 31 December 2025.
The loss for the year, after taxation, amounted to £605,000 (2024 - £1,986,000).
No interim dividend (2024: £nil) was declared.
The directors who served during the year were:
made during the year and remained in force at the date of this report.
In line with the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018 the company's energy use and greenhouse gas (GHG) emissions are set out below.
The data relates to the 12 month period from 1 January 2025 to 31 December 2025:
Primary energy efficiency measures implemented
The directors are mindful of environmental issues and take all reasonable steps to ensure that the emissions from the company’s business space are minimised.
Methodology
We have followed the 2020 HM Government Environmental Reporting Guidelines and used the 2023 UK Government's Conversation Factors for Company Reporting. Energy data is obtained from invoices and estimates if necessary.
We measure our annual emissions in relation to total turnover (our 'intensity ratio'). As a revenue-based business, total turnover is a quantifiable factor associated with our activities. The revenue used to calculate the intensity ratio is not that of the group, only the UK revenue has been included.
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WALKER BOOKS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
As permitted by S414c(11) of the Companies Act, the directors have elected to disclose information, required to be in the Directors’ Report by Schedule 7 of the ‘Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008’, in the Strategic report.
This report was approved by the board and signed on its behalf.
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WALKER BOOKS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2025
The directors are responsible for preparing the group strategic report, the directors' report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the Group 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 for the Group's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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WALKER BOOKS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF WALKER BOOKS LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2025
We have audited the financial statements of Walker Books Limited (the 'parent company') and its subsidiaries (the 'Group') for the year ended 31 December 2025, which comprise the consolidated profit and loss account, the consolidated statement of comprehensive income, the consolidated balance sheet, the company balance sheet, the consolidated statement of cash flows, the consolidated statement of changes in equity, the company statement of changes in equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
In 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 or the parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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WALKER BOOKS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF WALKER BOOKS LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
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.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the group 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 group 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 its environment obtained in the course of the audit, we have not identified material misstatements in the group strategic report or the directors' report.
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WALKER BOOKS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF WALKER BOOKS LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
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 Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
∙the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
∙we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the book publishing sector;
∙we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the group and company, including the Companies Act 2006, taxation legislation;
∙we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
∙identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the group and company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
∙making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
∙considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
To address the risk of fraud through management bias and override of controls, we:
∙performed analytical procedures to identify any unusual or unexpected relationships;
∙tested a sample of journal entries to identify unusual transactions;
∙assessed whether judgements and assumptions made in determining the accounting estimates set out in note 3 were indicative of potential bias; and
∙investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
∙agreeing financial statement disclosures to underlying supporting documentation;
∙reading the minutes of meetings of those charged with governance; and
∙enquiring of management as to actual and potential litigation and claims.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
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WALKER BOOKS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF WALKER BOOKS LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Auditor's responsibilities for the audit of the financial statements (continued)
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they
may involve deliberate concealment or collusion.
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 auditor's 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.
for and on behalf of
Chartered Accountants
Statutory Auditor
16 Great Queen Street
Covent Garden
WC2B 5AH
Date:
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WALKER BOOKS LIMITED
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2025
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WALKER BOOKS LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2025
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WALKER BOOKS LIMITED
CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2025
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 20 to 42 form part of these financial statements.
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WALKER BOOKS LIMITED
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2025
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 20 to 42 form part of these financial statements.
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WALKER BOOKS LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2025
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WALKER BOOKS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2025
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WALKER BOOKS LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2025
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WALKER BOOKS LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
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WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
The principal activity of the group and the companies is that of a book publisher.
Walker Books Limited is a private company limited by shares incorporated in England. The address of its registered office and principal place of business of the group is 87 Vauxhall Walk, London, SE11 5HJ.
The financial statements consolidate the accounts of Walker Books Limited and its subsidiary undertakings: Walker Books (Editorial) Limited, Walker Books Trustee Limited, Walker Productions Limited, Candlewick Press Inc., Walker Books Australia PTY Limited and Walker Books New Zealand Limited.
The financial statements are presented in Sterling and in thousands (£000).
Walker Books Limited is a private company limited by shares incorporated in England. The address of its registered office and principal place of business of the group is 87 Vauxhall Walk, London, SE11 5HJ.
The financial statements consolidate the accounts of Walker Books Limited and its subsidiary undertakings: Walker Books (Editorial) Limited, Walker Books Trustee Limited, Walker Productions Limited, Candlewick Press Inc., Walker Books Australia PTY Limited and Walker Books New Zealand Limited.
The financial statements are presented in Sterling and in thousands (£000).
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires group management to exercise judgment in applying the group's accounting policies (see note 3).
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit and loss of the group. The company has therefore taken advantage of the exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires group management to exercise judgment in applying the group's accounting policies (see note 3).
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit and loss of the group. The company has therefore taken advantage of the exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
∙Section 7 'Statement of Cash Flows' - Presentation of a statement of cash flow and related notes and disclosures;
∙Section 26 'Share based payments' - disclosure of share based payments;
∙Section 33 'Related Party disclosures' - Compensation for key management personnel;
∙Under section 408 of the Companies Act 2006 the company has not presented its own profit or loss account in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements incorporate the financial statements of the company and all group undertakings. These are adjusted, where appropriate, to conform to group accounting policies. The results of companies acquired or disposed of are included in the group profit and loss account after or up to the date that control passes respectively.
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WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
After making enquiries, the directors have a reasonable expectation that the group and company has adequate resources to continue in operational existence and meet its liabilities as they fall due for the foreseeable future, being a period of at least twelve months from the date these financial statements were approved. As disclosed in note 17 the group has a committed facility of £15m available until 2027 of which approximately £9.8m is available for drawdown at the reporting date which can fund working capital requirements were it to be necessary. Accordingly, the directors continue to adopt the going concern basis in preparing the financial statements.
Revenue from the sale of printed goods is recognised when all of the following conditions are satisfied:
Certain publishing contracts between the group and its authors give the group the right to sell its publishing and distribution rights to other publishers, including but not limited to electronic/e-books, overseas publishing and merchandise licencing rights. Publishing rights contracts generally contain guaranteed advances to be paid by the licensee as well as the potential to earn royalties above the guaranteed advance amount. Such contracts may establish specific milestones that determine when advances are payable and hence when revenue is to be recognised. Revenue from royalties earned above the guaranteed advance is recognised in the period in which such excess royalties are paid. Rights income is recognised based on the group’s share of income received, as set out in the contract.
Computer software
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. Software costs are amortised over a period of 3 years on a straight line basis to the profit and loss account.
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. Software costs are amortised over a period of 3 years on a straight line basis to the profit and loss account.
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WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
The Group adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the Group. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Freehold land and assets under construction are not depreciated.
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WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
Royalty advances are recorded as an asset within debtors when paid and carried forward where it is considered sufficient future royalties will earn out the advance.
The group has elected to apply Sections 11 and 12 of FRS 102 in respect of financial instruments.
Financial assets and financial liabilities are recognised when the group becomes party to the contractual provisions of the instrument.
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.
The group’s policies for its major classes of financial assets and financial liabilities are set out below.
Financial assets
Basic financial assets, including trade and other debtors, cash and bank balances, intercompany working capital balances, and intercompany financing are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.
Such assets are subsequently carried at amortised cost using the effective interest rate method, less any impairment.
Financial liabilities
Basic financial liabilities, including trade and other creditors, bank overdrafts and loans from fellow group companies 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 for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
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WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
Financial instruments (continued)
Derivative contracts
Derivatives contracts, including interest rate swaps and foreign exchange forward contracts, are not basic financial instruments.
Derivatives contracts are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in interest payable and similar expenses or interest receivable and similar income as appropriate.
Impairment of financial assets
Financial assets measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the profit and loss account.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between the asset's carrying amount and the best estimate of the amount the group would receive for the asset if it were to be sold at the reporting date.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between the asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If the financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets and financial liabilities
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.
If a transfer does not result in derecognition because the group has retained significant risks and rewards of ownership of the transferred asset, the group continues to recognise the transferred asset in its entirety and recognises a financial liability for the consideration received. The asset and liability are not offset. In subsequent periods, the group recognises any income on the transferred asset and any expense incurred on the financial liability.
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.
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WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
Financial instruments (continued)
Offsetting of financial assets and financial liabilities
Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is an 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.
Functional and presentational currency
The company's functional and presentational currency is Sterling (£).
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the profit and loss account.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the profit and loss account within 'finance income or costs'. All other foreign exchange gains and losses are presented in the profit and loss account within administrative expenses.
The rate of exchange ruling at the balance sheet date is used for translating into sterling the assets and liabilities of the overseas subsidiaries whilst the results and cash flows are translated at the average rate of exchange for the year. Exchange differences arising on consolidation are taken directly to reserves.
The company's functional and presentational currency is Sterling (£).
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the profit and loss account.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the profit and loss account within 'finance income or costs'. All other foreign exchange gains and losses are presented in the profit and loss account within administrative expenses.
The rate of exchange ruling at the balance sheet date is used for translating into sterling the assets and liabilities of the overseas subsidiaries whilst the results and cash flows are translated at the average rate of exchange for the year. Exchange differences arising on consolidation are taken directly to reserves.
The group operates a defined contribution pension scheme for employees. The assets of the scheme are held separately from those of the group. The annual contributions are charged to the profit and loss account.
The contributions are recognised as an expense in the consolidated profit and loss account when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet.
The contributions are recognised as an expense in the consolidated profit and loss account when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet.
Page 25
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
The tax expense for the year comprises current and deferred tax. Tax is recognised in the consolidated profit and loss account.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the company operates and generates income.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences. Deferred income tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
Page 26
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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 periods.
The following are the critical judgemental and estimations that the directors have made in the process of applying the group’s accounting policies and that have the most significant effect on the amounts recognised in the financial statements:
Impairment of royalty advances
Stock provisioning
The carrying value of stock, at the lower of cost and net realisable value, is dependent on key judgements and estimates that are made by management. The judgements relating to stock include an estimation of future expected average sales prices and disposal costs. Actual outcomes could be different to the assumptions used in determining the estimates.
Returns provision
It is the group’s policy to sell goods to customers with a right of return. Accumulated experience is used to estimate and provide for returns at the time of sale.
Impairment of investments in subsidiary undertakings
The directors review the carrying value of investments in subsidiary undertakings at each reporting date. An assessment is made as to whether an indication of impairment exists. The recoverable amount is the present value of the future cash flows expected to be recovered from the cash generating unit. Estimates are used in determining the future profitability and cash-generating ability of the cash generating unit and consideration to underlying value of the assets in the undertakings. Actual outcomes could be different from the estimates.
Deferred tax recognition
The directors assess the likelihood of future profitability at an entity level in determining whether and estimating how much deferred tax is recognised in respect of losses available for carry forward against future taxable profits. In reaching their conclusion due regard is given to the historic performance of the entity and confidence levels over utilisation of available losses in the short to medium term.
The directors assess the likelihood of future profitability at an entity level in determining whether and estimating how much deferred tax is recognised in respect of losses available for carry forward against future taxable profits. In reaching their conclusion due regard is given to the historic performance of the entity and confidence levels over utilisation of available losses in the short to medium term.
Page 27
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Analysis of turnover by country of destination:
Page 28
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Page 29
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Page 30
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
10.Taxation (continued)
Certain subsidiaries have tax losses which are described below. There are no other matters affecting the future tax charges based on current legislation.
The company's US subsidiary Candlewick Press Inc, which is dual resident in the US and the UK for corporation tax purposes, has a potential deferred tax asset in respect of unrealised provisions disallowed for US tax purposes amounting to £1,579,000 (2024: £1,656,000) and unrelieved foreign tax credits for UK tax purposes of £1,034,000 (2024: £1,034,000). This has not been recognised in the accounts as its recoverability is uncertain.
The company's Australian subsidiary Walker Books Australia PTY Limited, which is dual resident in Australia and the UK for corporation tax purposes, has a potential deferred tax asset in respect of unrealised provisions disallowed for Australian tax purposes amounting to £314,000 (2024: £389,000) and unrelieved foreign tax credits for UK tax purposes of £334,000 (2024: £334,000). This has not been recognised in the accounts as its recoverability is uncertain.
The company's US subsidiary Candlewick Press Inc, which is dual resident in the US and the UK for corporation tax purposes, has a potential deferred tax asset in respect of unrealised provisions disallowed for US tax purposes amounting to £1,579,000 (2024: £1,656,000) and unrelieved foreign tax credits for UK tax purposes of £1,034,000 (2024: £1,034,000). This has not been recognised in the accounts as its recoverability is uncertain.
The company's Australian subsidiary Walker Books Australia PTY Limited, which is dual resident in Australia and the UK for corporation tax purposes, has a potential deferred tax asset in respect of unrealised provisions disallowed for Australian tax purposes amounting to £314,000 (2024: £389,000) and unrelieved foreign tax credits for UK tax purposes of £334,000 (2024: £334,000). This has not been recognised in the accounts as its recoverability is uncertain.
Page 31
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
11.Intangible assets (continued)
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WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
12.Tangible fixed assets (continued)
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Page 35
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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Page 36
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Subsidiary undertakings
The following were subsidiary undertakings of the company:
Name Country of Percentage Principal activity
incorporation shareholding
Walker Books (Editorial)England 100% ordinary shares Editorial services
Limited**
Walker Books TrusteeEngland 100% ordinary shares Dormant
Limited
Walker Productions England 100% ordinary shares Television production and
Limited
Walker Productions England 100% ordinary shares Television production and
Limited** intellectual property
Candlewick Press Inc.USA 100% ordinary shares Book publishers
Walker Books AustraliaAustralia 100% ordinary & Book publishers
PTY Limited redeemable preference
shares
Walker Books New New Zealand 100% ordinary shares * Book publishers
Zealand Limited
*Shares held indirectly
For the year ended 31 December 2025 the above companies marked with a double asterisk (**) were entitled to exemption from audit under section 479A of the Companies Act 2006 relating to subsidiary companies.
For the year ended 31 December 2025 the above companies marked with a double asterisk (**) were entitled to exemption from audit under section 479A of the Companies Act 2006 relating to subsidiary companies.
Name Registered office
Walker Books (Editorial) Limited 87 Vauxhall Walk, London SE11 5HJ
Walker Books Trustees Limited 87 Vauxhall Walk, London SE11 5HJ
Walker Productions Limited 87 Vauxhall Walk, London SE11 5HJ
Candlewick Press Inc. 99 Dover Street, Somerville, MA, USA, 02144
Walker Books Australia PTY LimitedLevel 2, 1-15 Wilson Street, Newton, Australia, NSW 2042
Walker Books New Zealand Limited8 Murdoch Road, Grey Lynn, Auckland, New Zealand, 1021
Page 37
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Page 38
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Further details of the Group’s related party loan arrangements are set out in Note 26, related party transactions.
Page 39
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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Page 40
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
The group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The pension cost charge represents contributions payable by the group to the fund and amounted to £816,000 (2024: £691,000). Contributions totalling £83,000 (2024: £16,000) were payable to the fund at the balance sheet date and are included in creditors.
The company has agreed to provide continued financial support for the ongoing operations of its subsidiaries: Candlewick Press Inc, Walker Productions Limited, and Walker Books (Editorial) Limited.
Profit and loss account
The profit and loss reserve includes all current and prior period retained profits and losses.
Page 41
WALKER BOOKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
The immediate parent undertaking is TGM UK Bidco Limited.
The ultimate parent company isTrustbridge Global Media Holdings Co., Ltd, a company incorporated in the Cayman Islands.
In the opinion of the directors there is no one ultimate controlling party.
The ultimate parent company is
In the opinion of the directors there is no one ultimate controlling party.
Page 42