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

During the year, the Group delivered strong revenue growth, increasing by 8.2% (£5.0 million) to £65.9 million (2024: £60.9 million). Gross margin improved from 40.2% to 41.6%, resulting in gross profit of £27.4 million, an increase of £2.9 million compared with the previous year.

Whilst this performance is encouraging, operating profit decreased from £1.8 million to £1.7 million. This reduction reflects a deliberate strategic decision to invest significantly in our retail teams, systems, and infrastructure. These investments are intended to enhance the customer experience, strengthen operational capability, and establish a scalable operating model to support the Group's long-term growth ambitions.

Overall, the Board remains confident in the strength of the business and believes these investments position the Group well for continued sustainable growth in the years ahead.

In FY25, the business continued to invest in its infrastructure through the modernisation of its retail and finance systems. This strategic investment supports the Group's long-term growth objectives by improving operational efficiency, strengthening management information, and creating a robust platform capable of supporting increased transaction volumes and future expansion.

Across the year, the Group relocated its Chester, Warrington and Ipswich stores, providing colleagues and customers with brighter, more modern and accessible environments. In addition, the Group expanded its retail footprint by opening its first concession store in partnership with Sterling Home in Tillicoultry, Scotland, representing an important milestone in the development of the business and creating a platform for future growth.

The business continues to invest in the development of new and innovative product ranges, including the rollout of the new Ercol collection and a number of exciting additions to the product pipeline. These developments further strengthen the Group's offering and demonstrate its commitment to meeting evolving customer needs through continued product innovation.

Liv Home, which opened in December 2024, completed its first full year of trading during the period. As a new retail concept focused on providing customers with high-quality furniture that balances comfort, functionality and modern styling, the store has performed exceptionally well. Its successful first year demonstrates the strength of the proposition and provides a solid foundation for future growth.

The Directors are pleased with the performance delivered during the year and remain optimistic about the Group's prospects for 2026 and beyond, supported by ongoing investment, product innovation and a strong market position.

The Group operates in a dynamic business environment and is exposed to a number of risks and uncertainties that could affect the achievement of its strategic objectives. The Board routinely monitors these risks and reviews the effectiveness of the controls and mitigating actions in place.

The principal risks currently facing the Group are set out below, together with the measures adopted to manage them. Other risks and uncertainties, which are either not currently known or are not presently considered material, may also have an impact on the Group's financial performance, position and future development.

Business strategy

The Group's ability to achieve its growth ambitions depends on successfully executing its strategic priorities in an evolving market environment. The Board regularly reviews business performance, market trends and future opportunities to ensure the Group remains well positioned to respond to changing customer needs and market conditions.

Strategic objectives are translated into operational plans across the business, with clear accountability assigned to management teams. Progress against key initiatives and performance measures is monitored throughout the year through regular management and Board reviews, enabling timely action to be taken where required.

A culture of shared ownership is promoted throughout the organisation, with colleague objectives and incentive arrangements aligned to the successful delivery of the Group's strategic goals. This helps ensure that decision-making and business activity remain focused on creating long-term sustainable growth.

Economic conditions

The Group continues to operate in a consumer environment influenced by broader economic uncertainty and pressure on household finances. As a retailer and manufacturer of higher-value products, demand can be affected by changes in consumer confidence and spending patterns.

However, the Group's specialist product offering, which focuses on improving comfort, mobility and wellbeing, differentiates it from the wider furniture market. Supported by long-standing relationships with Occupational Therapists and a strong reputation for quality and service, the Group believes it is well positioned to maintain demand and continue to attract customers seeking solutions to specific comfort and mobility needs.

Supply chain

The Group's performance is dependent upon maintaining a resilient supply chain capable of delivering high-quality products and services to customers in a timely and cost-effective manner. Disruption to supplier operations, logistics networks or input costs could adversely impact product availability, lead times and profitability.

The Group mitigates these risks through its close collaboration with suppliers, regular review of demand forecasts and ongoing monitoring of stock availability. The Group's vertically integrated operating model, including the procurement of products from fellow Group companies and the use of an in-house delivery network, provides greater control over product quality, service standards and operational performance.

Supplier relationships are regularly reviewed to ensure competitiveness, continuity of supply and adherence to quality standards. The Group also seeks to maintain appropriate inventory levels and flexible sourcing arrangements to minimise the impact of potential supply chain disruptions.

Key performance indicators used by the directors to monitor the group include the following:

In addition, the Directors use a range of financial and operational key performance indicators to monitor the Company's performance. These include footfall, order intake, profitability by channel and location, and customer satisfaction scores, all of which are reviewed regularly to support effective management of the business.

The Directors of High Seat Holdings Limited have acted throughout the year in a manner they consider, in good faith, most likely to promote the long-term success of the Group for the benefit of its shareholders as a whole, while having regard to the wider stakeholder considerations set out in section 172(1) of the Companies Act 2006.

In fulfilling their duties, the Directors seek to create sustainable long-term value through responsible decision-making, balancing the interests of the Group's stakeholders with its strategic objectives. Throughout the year, the Directors considered a range of factors, including:

• the likely long-term consequences of decisions and investments;

• the needs and expectations of customers;

• the interests, wellbeing and development of colleagues;

• the requirements of the Group's banking and funding partners;

• maintaining strong relationships with suppliers and other business partners;

• the impact of the Group's operations on the communities and environment in which it operates;

• maintaining high standards of business conduct and corporate governance; and

• acting fairly between the Group's shareholders.

In this regard, the directors discharge their duties as follows:

Risk management

The Directors recognise that effective risk management is essential to the delivery of the Group's strategic objectives and long-term success. The Group maintains an ongoing process for identifying, assessing and managing risks that could affect its operations, financial performance or future prospects.

Principal risks are reviewed regularly by the Board, with formal discussions taking place throughout the year as part of the Group's governance framework. This process is supported by input from management teams across the business and, where appropriate, external specialist advisers and market intelligence.

The principal risks and uncertainties currently facing the Group, together with the key actions taken to mitigate them, are outlined below.

Customers

The Directors recognise that delivering positive outcomes for customers is fundamental to the long-term success of the business. Customer considerations are embedded within key strategic and operational decisions, including those relating to product quality, service standards, accessibility and value for money.

The Group actively seeks customer feedback through surveys, independent review platforms and customer engagement activities. Insights from colleagues working directly with customers are also considered to support continuous improvement across the business.

Colleagues

The Directors are committed to fostering an inclusive, supportive and rewarding working environment in which colleagues are treated with fairness, respect and equality. The Group continues to review and enhance colleague pay, benefits and wellbeing initiatives to attract, retain and develop talented people.

Health, safety and wellbeing remain key priorities. The Group maintains a comprehensive framework of support, including a Group-wide Health and Safety Committee, trained Mental Health First Aiders, wellbeing resources and a confidential Employee Assistance Programme.

As a family-owned business, the Group places significant importance on its culture and values, recognising that engaged and motivated colleagues are critical to the successful delivery of its strategy and long-term growth.

Bank and funding partners

The Directors maintain regular engagement with the Group's banking partner when assessing strategic plans, investment opportunities and financing requirements. Financial resources and borrowing facilities are monitored to ensure adequate funding is available to support operations, future growth initiatives and unforeseen events.

The Group seeks to maintain open and transparent relationships with its funding partners through regular communication regarding trading performance, financial results and strategic developments.

Suppliers and business partners

The Group works closely with a carefully selected network of suppliers and service partners to ensure the delivery of high-quality products and services to customers.

Directors and senior management engage regularly with key suppliers and business partners to review performance, quality, innovation and commercial matters. These collaborative relationships help strengthen supply chain resilience, support operational efficiency and enable the Group to continue enhancing its customer proposition.

Society and the environment

The Group recognises the importance of operating responsibly and making a positive contribution to the communities in which it operates. Social responsibility considerations are integrated into decision-making across the business, supported through a range of local and national charitable initiatives and community partnerships.

During the year, the Group continued to advance its environmental and sustainability objectives, with a particular focus on reducing waste, improving resource efficiency and lowering its environmental impact. Key initiatives included further investment in the reuse of packaging materials and the installation of solar panels at the Leeds distribution centre to support renewable energy generation.

The Group also continued to work closely with charitable partners, including the Salvation Army and the British Heart Foundation, to extend the useful life of furniture products and reduce waste. These initiatives successfully diverted more than 1,000 tonnes of furniture from landfill during the year.

Business conduct and shareholders

The Directors are committed to maintaining high standards of business conduct, integrity and corporate governance, recognising that these are fundamental to the Group's long-term success.

The Group is wholly owned by High Seat Holdings Limited and the principal shareholders are represented on both the Company and Group Boards. This governance structure supports effective oversight of the business and enables shareholders to contribute to the consideration of key strategic matters.

Through regular Board meetings and detailed performance reporting, the Directors ensure that shareholders remain appropriately informed of the Company's performance, risks, opportunities and strategic priorities. This approach promotes effective decision-making and supports the sustainable long-term success of the business.

On behalf of the board

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

The company acts as the holding company for its two wholly owned subsidiaries, High Seat Limited and HSL Manufacturing Limited. The results presented are those for the consolidated group, the principal activities of which are the design, manufacture, retail sale and delivery of fixed and motion furniture.

The results for the year are set out on page 13.

Ordinary dividends of £1m (2024 - £2.9m) were paid during the year. The directors do not recommend payment of a further dividend in relation to the year.

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

The group is committed to a policy of recruitment and promotion on the basis of aptitude and ability, without discrimination of any kind. Particular attention is given to the training and promotion of disabled colleagues to ensure that their career development is not unfairly restricted by their disability, or perceptions of it.

The group’s HR procedures make clear that full and fair consideration must be given to applications made by and the promotion of disabled persons. Where a colleague becomes disabled, the group’s HR procedures also require that reasonable effort is made to ensure that they have the opportunity for continued employment within the group.

Where appropriate colleagues who become disabled are offered the opportunity to retrain.

The company maintains an intranet site, ourHSL, providing colleagues with information on matters of concern to them as employees. In addition, colleagues receive regular briefings from the directors and the senior management team through a number of other channels, highlighting matters relevant to them, including the economic, financial and commercial factors affecting the performance of the company.

The company also periodically undertakes listening groups across all areas of the business, ad hoc questionnaires, and an annual survey to measure colleague engagement levels and canvass views on significant matters.

The auditor, Azets Audit Services Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

In accordance with the Streamlined Energy and Carbon (“SECR”) reporting requirements, the directors report on the group’s energy usage and greenhouse gas emissions for the year ended 31 December 2025.

In accordance with the requirements, energy usage data reflect the group’s electricity and gas use during the year at HSL’s factory, office and warehouse premises as well as across the estate of showrooms. In addition, reported energy use captures fuel used by company operated vehicles and machinery, and business mileage undertaken by colleagues in privately owned cars.

Emissions have been calculated using conversion factors available from public information sources. Emissions and intensity ratios are presented on both a location-basis and market-basis, in the latter case reflecting the impact of a renewable energy tariff.

Summary of HSL's Environmental Activities During 2025

HSL’s environmental strategy in 2025 continued its journey toward a net-zero operation, with progress across energy efficiency, waste reduction, and transport. Despite a 4.8% increase in total energy use – reflecting growth in business activity – the location-based emissions intensity ratio improved to 23.0 tCO₂e per £ million of turnover, down from 24.2 in 2024. The market-based intensity ratio remained broadly stable at 17.0 tCO₂e/£m, supported by HSL’s continued commitment to a renewable electricity tariff across all sites.

The group’s directors are encouraged by the improving intensity trend and remain focused on reducing absolute emissions, including progressing work to measure and report Scope 3 emissions in future periods.

Key Initiatives and Achievements:

• Renewable Energy: HSL maintained its renewable electricity tariff across all sites throughout 2025, having first re-entered the green tariff on 1 December 2024. This continues to reduce market-based emissions relative to location-based figures.

• Waste Diversion and Partnership: The group continued its ongoing partnership with the British Heart Foundation (BHF), diverting “second quality” furniture from landfill. This collaboration reduces waste while providing charitable support.

• Fleet Electrification: HSL continued its investment in electric vehicles, expanding its fleet to include both company cars and other vehicles. This ongoing strategy aims to reduce emissions from its transport operations and lower the group’s overall carbon footprint.

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

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

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

• select suitable accounting policies and then apply them consistently;

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

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

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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

In our opinion the financial statements:

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

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

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

Basis for opinion

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

Conclusions relating to going concern

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

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

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

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

• The information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• The strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

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

• adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

• the parent company financial statements are not in agreement with the accounting records and returns; or

• certain disclosures of directors' remuneration specified by law are not made; or

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

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.

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

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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

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

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

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

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

• Reviewing minutes of meetings of those charged with governance;

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

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

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

• Performing audit work over the timing and recognition of revenue and in particular whether it has been recorded in the correct accounting period.

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

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £457,323 (2024 - £1,984,828 profit).

High Seat Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Units 1-3a Grange Road Industrial Estate, Grange Road, Batley, West Yorkshire, WF17 6LN.

The group consists of High Seat Holdings Limited and all of its subsidiaries.

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

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £1.

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

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 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

• Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

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

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

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

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.

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

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

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

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

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

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

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

Assets in the course of construction are not depreciated.

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.

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

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

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

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

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

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

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

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.

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.

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

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

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

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

The stock provision has been calculated based on the estimated net realisable value of demonstration stock items. The directors have assumed that a consistent stock provision will be needed against all stock lines in all stores, based on the type of stock, and the historical stock write downs will remain consistent in future years.

The returns provision has been calculated based on historical levels of customer returns. The directors have assumed that the future level of returns will continue to be consistent with historical levels.

The estimate is based on the useful life of the asset and how long it will be used to realise future economic benefits.

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

Their aggregate remuneration comprised:

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 4 (2024 - 6).

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

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

The directors applied the amendments to FRS102, effective 1 January 2019, and as a result elected to transfer investment properties at deemed cost to tangible fixed assets at this date. These properties are owned by the company and leased to other entities within the group.

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

Registered office addresses (all UK unless otherwise indicated):

Amounts owed by group undertakings are unsecured, interest free and repayable on demand.

Amounts owed to group undertakings are unsecured, interest free and repayable on demand.

Obligations under finance leases are secured against the assets to which they relate.

The company took out a revolving credit facility in 2024 which had a balance of £1.96m (2024 - £2.75m) at the year end. Interest is charged at 2.7% per annum over the relevant reference rate and is due by the 15 August 2027.

The above is secured through cross company guarantees.

The following are the major deferred tax liabilities and assets 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.

Deferred tax is not recognised in respect of tax losses of £2,397,520 (2024: £3,509,252) as it is not probable that they will be recovered against the reversal of deferred tax liabilities or future taxable profits. Had this not been the case a deferred tax asset of £599,380 (2024: £809,466) would have been recognised when calculated at the estimated future rate of 25% (2024 - 25%).

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.

Ordinary A1 shares carry the right of one vote each, have the entitlement to receive dividends and £25,000,000 return of capital subject to the holders of B shares being paid out fixed amounts first.

Ordinary A2 shares carry the right of one vote per four shares, have the entitlement to receive dividends and are entitled to 55% of the surplus on a return of capital, subject to the A1 shares being paid out first.

Ordinary B1 shares carry no right to vote, are not entitled to receive dividends but are entitled to a fixed amount of £2,000 to each shareholder on a return of capital. Thereafter the shares are entitled to 33.75% of the surplus on a return of capital subject to the A1 shares being paid out first.

Ordinary B2 shares carry no right to vote, are not entitled to receive dividends but are entitled to a fixed amount of £2,000 to each shareholder on a return of capital. Thereafter the shares are entitled to 2.5% of the surplus on a return of capital subject to the A1 shares being paid out first.

Ordinary C shares carry the right of one vote each, are not entitled to receive dividends but are entitled to 7.5% of the surplus on a return of capital subject to the A1 shares being paid out first.

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

The group has taken advantage of the disclosure exemptions of Section 33.1A of FRS 102 which permit it to not present details of its transactions with members of the group headed by High Seat Holdings Limited where relevant group companies are all wholly owned. Details of outstanding balances as at the year end are given in notes 17 and 19.

During the year the group paid rent of £60,850 (2024 - £60,850) to P Burrows, a relative of Mr W J Burrows, a director.

The company is jointly controlled by Mr W J Burrows and Mrs D L Burrows, both of whom are directors.