The directors present the strategic report for the period ended 31 December 2025, being the first financial period of the company and the group from incorporation on 28 April 2025.
During the period, the company received dividends of £nil from its subsidiary undertakings.
On 2 July 2025, CP PAC Group Limited acquired 100% of the issued share capital of Process Automation & Calibration Holdings Limited (Group), a company incorporated in Northern Ireland, whose subsidiary businesses are engaged in the provision of electrical engineering, automation, calibration and related services. The acquisition is expected to strengthen the group's market position in the UK engineering sector.
For the period from acquisition to 31 December 2025, the group generated turnover of £4,536,861 and gross profit of £494,172, representing a gross margin of 10.9%. After administrative expenses of £1,683,679 and other operating income of £19,873, the group recorded an operating loss of £1,169,634. After interest payable of £178,846, arising substantially from the financing of the acquisition, the loss before taxation was £1,348,480. After a tax charge of £24,797, the loss for the financial period was £1,373,277. As this is the group's first financial period, no comparative figures are presented.
Financial position
At 31 December 2025 the group had net assets of £3,897,719, comprising called up share capital of £5,270,996 less accumulated losses of £1,373,277 for the period. The balance sheet includes goodwill of £5,837,374 arising on the acquisition of the PAC group. Net current assets were £83,361 and the group held cash balances of £1,786,855. The group's borrowings falling due after more than one year were £2,228,073, reflecting in part the financing of the acquisition. The directors monitor the group's cash flow and financing arrangements closely and, as set out in the going concern note to the financial statements, consider that the group has adequate resources to continue in operational existence for at least twelve months from the date of approval of these financial statements.
The directors use the following financial key performance indicators, together with more detailed management information, to monitor the performance and financial position of the group:
Key performance indicator | Period ended 31 December 2025 |
Turnover | £4.54m |
Operating margin | (25.8)% |
Principal risks and uncertainties
The directors have identified the following as the principal risks and uncertainties facing the group. These include risks arising from the trading activities of the group's subsidiaries, and risks specific to the company as the group's holding company:
Trading performance of subsidiaries – a significant proportion of the group's revenue is derived from project and contract-based work undertaken by its trading subsidiaries, the timing and value of which can vary between periods.
Competition and pricing pressure – the group's trading subsidiaries operate in specialist engineering and technical service markets and are exposed to competitive tendering pressure on margins.
People and skills – the group's performance depends on its ability to recruit, train and retain suitably qualified and accredited engineers and technicians in a market where relevant skills are in short supply.
Health, safety and regulatory compliance – given the nature of the group's work, including electrical, gas detection, switchgear and calibration services, the group is exposed to health and safety, environmental and regulatory risks, which it manages through its quality, health and safety management systems and accreditations.
Credit risk – the group is exposed to the risk of delayed or non-payment by customers; this is managed through credit control procedures and ongoing monitoring of debtor balances.
Recoverability of investments – the company's principal financial risk is the recoverability of its investments. The directors review the carrying value of the company's investments and provisions are made where considered necessary.
Geopolitical and macroeconomic risk – subsequent to the year end there has been significant military activity in Iran that has caused geo-political shocks around the world. The key financial risks to the group resulting from this are considered to be higher inflation as well as the potential for disruption in the supply chain, all of which may impact the profitability of the group's investments.
Acquisition integration risk – the group has grown through acquisition during the period and, subsequent to the year end, has completed a further acquisition (see below). The directors recognise a risk that the anticipated benefits of these acquisitions may not be fully realised if the acquired businesses are not successfully integrated, and this is managed through ongoing oversight of the acquired businesses by the board.
Financing and leverage risk – the acquisition of the PAC group was funded in part through borrowings, and the group's net current assets and interest cover remain relatively modest at this early stage. The directors regularly monitor cash flow, covenant compliance and financing requirements across the group to manage this risk.
Other information and explanations
Post Balance Sheet Event
On 27 February 2026, the investment acquired 100% of the issued share capital of Lawtronic Holdings Limited and its subsidiaries, a company and group that is incorporated in England. The acquisition was completed after the reporting date and therefore has not been recognised in the financial statements for the year ended 31 December 2025. The acquisition is expected to strengthen the investment's market position in the UK engineering sector.
On behalf of the board
The directors present their annual report and financial statements for the period ended 31 December 2025.
The results for the period are set out out on page 7.
The directors who held office during the period and up to the date of signature of the financial statements were as follows:
On 27 February 2026, the Company acquired 100% of the issued share capital of Lawtronic Holdings Limited and its subsidiaries, a company and group that is incorporated in England. The acquisition was completed after the reporting date and therefore has not been recognised in the financial statements for the period ended 31 December 2025. The acquisition is expected to strengthen the investment's market position in the UK engineering sector.
RSM UK Audit LLP were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, the directors intend to reconfirm the appointment of RSM UK Audit LLP.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law).
Under company law, the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period.
In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and parent company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and parent company, and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and parent company, and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
We have audited the financial statements of CP PAC Group Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 31 December 2025 which comprise the group profit and loss account, group balance sheet, company balance sheet, group statement of changes in equity, company statement of changes in equity notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
The information given in the strategic report and the directors' report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
The strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
The extent to which our procedures are capable of detecting irregularities, including fraud
Irregularities are instances of non-compliance with laws and regulations.The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements, to perform audit procedures to help identify instances of non-compliance with other laws and regulations that may have a material effect on the financial statements, and to respond appropriately to identified or suspected non-compliance with laws and regulations identified during the audit.
In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit.
However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the group audit engagement team:
obtained an understanding of the nature of the industry and sector, including the legal and regulatory framework that the group and parent company operate in and how the group and parent company are complying with the legal and regulatory framework;
inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud;
discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud.
As a result of these procedures we consider the most significant laws and regulations that have a direct impact on the financial statements are FRS 102, the Companies Act 2006 and tax compliance regulations. We performed audit procedures to detect non-compliances which may have a material impact on the financial statements which included reviewing financial statement disclosures, inspecting correspondence with local tax authorities and evaluating advice received from external tax advisors.
The most significant laws and regulations that have an indirect impact on the financial statements are those in relation to health and safety regulations, and employment laws and regulations. We performed audit procedures to inquire of management whether the company is in compliance with these laws and regulations and inspected correspondence with regulatory authorities, as appropriate.
The group audit engagement team identified the risk of management override of controls and revenue recognition as the areas where the financial statements were most susceptible to material misstatement due to fraud. Audit procedures performed included but were not limited to testing manual journal entries and other adjustments and evaluating the business rationale in relation to significant, unusual transactions and transactions entered into outside the normal course of business, and testing revenue using data analytics and substantive procedures.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the parent 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 parent 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 parent company and the parent company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
There are no other items of recognisable income.
As permitted by section 408 of the Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the period was £606,141.
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
CP PAC Group Limited (“the company”) is a private company limited by shares domiciled and incorporated in England and Wales. The registered office is CP House, Otterspool Way, Watford, Hertfordshire, WD25 8JJ.
The group consists of CP PAC Group Limited and all of its subsidiaries.
The Company was incorporated on 28 April 2025 and these are its first financial statements. Accordingly, the financial statements cover the period from incorporation to 31 December 2025, being a period of approximately eight months rather than a full twelve-month reporting period. As these are the Company's first financial statements, no comparative information is presented.
These financial statements have been prepared in accordance with FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" ("FRS 102"), the requirements of the Companies Act 2006 as applicable to companies subject to the medium companies regime. The disclosure requirements of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the company’s accounting policies (see note 2).
The company has taken advantage of the exemption under section 408 of the Companies Act 2006 and has not presented its own profit and loss account in these financial statements.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below. These group and company financial statements for the period ended 31 December 2025 are the first financial statements of CP PAC Group Limited.
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 or loss of the group. The company has therefore taken advantage of 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 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of CP Holdings Limited. These consolidated financial statements are available from Companies House, Crown Way, Cardiff, CF14 3UZ.
The consolidated group financial statements consist of the financial statements of the parent company CP PAC Group Limited together with all entities controlled by the parent company and its subsidiaries.
All financial statements are made up to 31 December 2025. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.
Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.
If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.
Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.
After making enquiries, including being in receipt of a letter of support from the Company’s intermediate parent undertaking, CP Holdings Limited the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence and to meet its liabilities as they fall due for the foreseeable future, being a period of at least twelve months from the date of approval of these financial statements. Accordingly, the Directors continue to adopt the going concern basis in preparing the financial statements.
Revenue comprises sales of goods or services provided to customers net of value added tax and other sales taxes, less an appropriate deduction for actual and expected returns and discounts. Revenue is recognised when performance obligations are satisfied and the control of goods or services is transferred to the buyer. Where the performance obligation is satisfied over time, revenue is recognised in accordance with its progress towards complete satisfaction of that performance obligation.
When cash inflows are deferred and represent a financing arrangement, the promised consideration is adjusted for the effects of the time value of money, which is recognised as interest income.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that are recoverable.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.
Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.
In the parent company financial statements, investments in associates are accounted for at cost less impairment.
Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
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. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
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.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives 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 finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
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.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
When the group acts as a lessor, a lease is classified as a finance lease whenever it transfers substantially all the risks and rewards of ownership of the underlying asset to the lessee, either at the end of the lease term or for the major part of the economic life of the asset. All other leases are classified as operating leases. If an arrangement contains both lease and non-lease components, the group allocates the consideration in the contract to the two elements.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
The directors have exercised judgement in determining whether there are any indications of impairment of the company's work in progress balance and the amounts recoverable by the group on long-term contracts. Factors taken into consideration include estimates made regarding the economic viability and expected future financial performance of the related project or contract.
Revenue is recognised upon contracted agreement with customers over the period of time for services delivered, and at a point in time for sale of goods.
The cost of sales in relation to jobs and projects are subject to a degree of estimation and transfers out of work in progress are based on the estimated margin. Assessments of which, are based against expected margins, client and market knowledge and quoted works outturns. Where costs have been incurred in excess of the stage of completion, these are included within stocks and work in progress.
The Directors are required to assess, at each reporting date, whether there are any indicators that goodwill may be impaired. In making this assessment, the Directors have exercised judgement in identifying the cash-generating unit(s) to which goodwill is allocated, and in evaluating whether trading performance, market conditions, or other factors during the year represent an indicator of impairment requiring a full impairment review. Having considered trading performance against budget, covenant headroom and market conditions, the Directors concluded that no impairment indicators were present.
The whole of the turnover is attributable to rendering of goods and services.
All turnover arose within the United Kingdom and Republic of Ireland.
The average monthly number of persons (including directors) employed by the group and company during the period was:
Their aggregate remuneration comprised:
The Company has no employees other than the directors who are remunerated by a subsidiary undertaking, Process Automation & Calibrations Limited, or the intermediate parent undertaking, CP Holdings Limited.
The directors are not remunerated directly by the company but are remunerated by related undertakings, Process Automation and Calibrations Limited, or CP Holdings Limited.
Included within Finance costs for the period ended 2025 are Dividends on redeemable preference shares of £72,716 represent the Preference Dividend paid and accrued on the Preference Shares for the period from 2 July 2025 to 31 December 2025.
The actual charge for the period can be reconciled to the expected credit for the period based on the profit or loss and the standard rate of tax as follows:
CP PAC Group Limited acquired the PAC Holdings Limited group in the year, see note 24.
Details of the company's subsidiaries at 31 December 2025 are as follows:
The company has entered into a £2,900,000 term loan with HSBC UK Bank plc on 19 August 2025, repayable quarterly over five years at Bank of England rate +3%. The loan is secured by a fixed and floating charge over the specific assets of the company and contains EBITDA related leverage covenants tested quarterly.
Amounts due to group undertakings are unsecured, interest-free and repayable on demand.
Included within accruals is £36,120 in respect of the Preference Dividend accrued but not yet paid at the balance sheet date.
Recognised in Bank Loans is a long-term secured debenture maturing in 2030, the debenture is secured by fixed charges and accrues interest at a floating rate of 3% above the Bank of England base rate.
At the reporting date, the Company was in breach of the interest cover covenant relating to its borrowing facility, resulting in the lender obtaining the contractual right to demand repayment. Accordingly, the company did not have an unconditional right to defer settlement for at least twelve months after the reporting date and, pursuant to FRS 102.4.7(a), the borrowing has been classified as a current liability. Following the reporting date, the lender granted a waiver in respect of the covenant breach.
Other borrowings refer to the issue of preference shares during 2025 and maturing in 2030.
The long-term bank loan is secured by fixed charges over specified company assets.
The company has a long-term secured debenture maturing in 2030. The debenture accrues interest at a floating rate of 3% above the Bank of England base rate.
Holders of Preference Shares are entitled, in priority to holders of any other class of share, to a fixed cumulative preferential net cash dividend calculated by reference to the Preference Dividend Rate applied to the Issue Price of each Preference Share in issue. The Preference Dividend Rate for each Quarter is calculated as Base Rate plus tax adjusted Third Party Debt Margin. The dividend accrues on a daily basis from the date of subscription and is payable quarterly in cash, in arrears, by the last day of the month following each Preference Share Dividend Date. The Preference Shares are due to be redeemed by 31 July 2030.
As the Preference Shares carry a mandatory cumulative dividend obligation, they are classified as a financial liability in accordance with Section 22 of FRS 102, with the associated dividend recognised as a finance cost in profit or loss.
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
The following are the major deferred tax liabilities recognised by the group and company, and movements thereon:
The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
The profit and loss account includes all current period profits and losses.
On 2 July 2025, CP PAC Group Limited acquired 100% of the issued share capital of Process Automation & Calibrations Holdings Limited (Group), a company incorporated in Northern Ireland, with its subsidiary businesses engaged in the provision of electrical engineering, manufacturing and related services. The acquisition represents a vehicle of investment by which the CP Holdings Limited group have expanded their strategic presence in the UK market.
The results of Process Automation & Calibrations Holdings Limited (Group) have been included in the consolidated financial statements from the date of acquisition.
The adjustments arising on acquisition were in respect of the following:
(a) Restatement of plant and machinery to fair value.
(b) The recognition of intangible assets in relation to a patent for preformer apparatus.
The goodwill recognised reflects the expected future profitability of the acquired business, the value of the assembled workforce and anticipated synergies arising from the combination of operations. Acquisition-related costs of £54,000 were capitalised as part of the investment transaction costs.
In order for the subsidiary companies, Process Automation & Calibrations Holdings Limited (CRN NI657403) and Barbour Engineering & Fabrication Limited (CRN NI687633) to take audit exemption under section 479A of the Companies Act 2006, the company has guaranteed all outstanding liabilities of the subsidiaries at 31 December 2025 until those liabilities are settled in full.
On 27 February 2026, the Company acquired 100% of the issued share capital of Lawtronic Holdings Limited and its subsidiaries, a company and group that is incorporated in England. The acquisition was completed after the reporting date and therefore has not been recognised in the financial statements for the period ended 31 December 2025. The acquisition is expected to strengthen the investment's market position in the UK engineering sector.
The company has taken advantage of the exemption contained in FRS 102 Section "Related Party Disclosure" from disclosing transactions with entities which are a wholly owned part of the group.