Registered number: 02435931
FOR THE YEAR ENDED 31 DECEMBER 2025
COMPANY INFORMATION
CONTENTS
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2025
The directors present their report and the financial statements for the year ended 31 December 2025.
The profit for the year, after taxation, amounted to £67,416 (2024 -£1,058,249).
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
The directors who served during the year were:
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
The directors are responsible for preparing the Directors' Report and the financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the company's financial statements 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 company's transactions and disclose with reasonable accuracy at any time the financial position of the company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The auditor, S&W Audit (a trading name of S&W Partners Audit Limited), will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
In preparing this report, the directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
This report was approved by the board and signed on its behalf.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF HARTE HANKS UK LIMITED
Opinion
We have audited the financial statements of Harte Hanks UK Limited (the 'company') for the year ended 31 December 2025 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity and the 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 FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice).
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 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 company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF HARTE HANKS UK LIMITED
Matters on which we are required to report by exception
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, or returns adequate for our audit have not been received from branches not visited by us; or
∙the financial statements are not in agreement with the accounting records and returns; or
∙certain disclosures of directors’ remuneration specified by law are not made; or
∙we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set out on page 2, 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.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF HARTE HANKS UK LIMITED
In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue 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.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
∙the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
∙we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the sector;
∙we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety legislation;
∙we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
∙identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
∙making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud;
∙considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations; and
∙understanding the design of the company’s remuneration policies.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF HARTE HANKS UK LIMITED
To address the risk of fraud through management bias and override of controls, we:
∙performed analytical procedures to identify any unusual or unexpected relationships;
∙tested journal entries to identify unusual transactions;
∙assessed whether judgements and assumptions made in determining the accounting estimates set out in note 3 were indicative of potential bias; and
∙investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
∙agreeing financial statement disclosures to underlying supporting documentation;
∙reading the minutes of meetings of those charged with governance;
∙enquiring of management as to actual and potential litigation and claims; and
∙reviewing correspondence with HMRC, relevant regulators and the company’s legal advisors.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: 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 company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an Auditor’s Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants
Statutory Auditor
22 Wycombe End
HP9 1NB
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STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2025
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BALANCE SHEET
AS AT 31 DECEMBER 2025
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BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2025
The Company's financial statements have been prepared in accordance with the provisions applicable to
companies subject to the small companies regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 12 to 25 form part of these financial statements.
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STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Harte Hanks UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is Spaces Uxbridge, The Charter Building, Charter Place, Uxbridge, Middlesex, UB8 1JG
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with FRS 102 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland' and the requirements of the Companies Act 2006. The disclosure requirements of Section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The company has taken advantage of the exemption under section 401 of the Companies Act
2006 not to prepare consolidated accounts. The financial statements present information about
the company as an individual entity and not about its group.
The company has taken advantage of the exemption under section 401 of the Companies Act
2006 not to prepare consolidated accounts. The financial statements present information about
the company as an individual entity and not about its group.
The following principal accounting policies have been applied:
The financial statements have been prepared on a going concern basis. From reviewing the Company’s forecasts and projections and taking account of reasonable possible changes in trading performance as a consequence of an uncertain economic climate, the directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
Revenue is recognised when all of the following criteria are satisfied: (i) persuasive evidence of an arrangement exists; (ii) the price is fixed or determinable; (iii) collectability is reasonably assured; and (iv) the service has been performed or the product has been delivered.
Turnover in respect of long term contracts and contracts for on-going services represents the value of the work done in the year, including estimates of amounts not invoiced, determined by reference to the stage of completion of each contract which in turn is measured as the proportion which costs to date bears to the expected total cost for the contract.
Profit on long term contracts for services is recognised in the profit and loss account if the final outcome can be assessed with reasonable certainty by including turnover and related costs as contract activity progresses.
Amounts recoverable on long term contracts are included in debtors and stated at the net sales value of the work done after provision of contingencies and anticipated future losses on contracts, less amounts received as progress payments on account.
Excess progress payments are included in creditors as payment on account.
Payments received in advance of the performance of services or delivery of the product are recorded as deferred revenue until such time as the services are performed or the product is delivered.
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 it is probable will be recovered.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Amortisation is provided on the following basis:
- Software licences - Straight line over the term of the licence
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
At each reporting period end date, the company reviews the carrying amounts of its 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).
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
At each reporting period end date, the company reviews the carrying amounts of its 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).
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
The company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's Balance Sheet when the company becomes party to the contractual provisions of the instrument.
Basic financial assets
Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The company's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
Basic financial liabilities
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 company after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other creditors, bank loans and other loans are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised 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.
Key sources of estimation uncertainty
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.
Revenue recognition in respect of services
The accounting policy for revenue recognition has an impact on reported results and relies on certain estimates that require judgments on the part of management.
Revenue is derived from a variety of services and products, and may be billed at hourly rates, monthly rates, or a fixed price. All sales require either a purchase order, a statement of work signed by the client, a written contract, or some other form of written authorisation from the client.
Revenue from agency and creative services, analytical services, and market research is typically billed based on time and materials.
Revenue from email marketing, social media marketing, digital techniques such as search engine maximisation ("SEM"), and other digital solutions is recognised as the work is performed. Revenue from these services is typically based on a fixed price or rate given to the client.
Revenue associated with new marketing database builds is deferred until complete or until client acceptance. Upon completion or acceptance, revenue and direct build costs are then recognised over the term of the related arrangement as the services are provided. Revenue from database and website hosting services is recognised ratably over the contractual hosting period. Pricing for database builds are typically based on a fixed price and hosting fees are typically based on a fixed price per month or per contract.
Revenue from database subscriptions is based on a fixed price and is recognised ratably over the term of the subscription. Revenue from standalone technology data sales is recognised at the time of delivery.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
3.Judgements in applying accounting policies (continued)
For certain arrangements, the company enters into contracts that include delivery of a combination of two or more service offerings. Such arrangements are divided into separate units of accounting, provided that the delivered element(s) has stand-alone value and objective and reliable evidence of the fair value of the undelivered element(s) exist(s).
When it is not possible to un-bundle the arrangement into separate units of accounting, revenue from each service is recognised separately, and in accordance with our revenue recognition policy for each element. If it is not possible to un-bundle the arrangement into separate units of accounting, one of the revenue recognition policies is applied to the entire arrangement. This might impact the timing of revenue recognition, but would not change the total revenue recognised from the arrangement.
Recoverability of receivables
The allowance for doubtful accounts is maintained at a balance adequate to reduce accounts receivable to the amount of cash expected to be realised upon collection. The methodology used to determine the minimum allowance balance is based on prior collection experience and is generally related to the accounts receivable balance in various aging categories. The balance is also influenced by specific clients’ financial strength and circumstance.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Page 23
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Other reserves
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund. There were contributions outstanding of £34,076 (2024 - £10,976 ) at the end of the current period.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
The parties estimated the total consideration expected to be issued and paid to Harte Hanks Inc stockholders in the acquisition to consist of approximately 1.92 million shares of Star Equity preferred stock and approximately $19.2 million to be paid in cash. Star Equity intends to finance the acquisition through a combination of cash on hand, issuance of preferred stock and debt financing. Star Equity intends to finance the cash component of the acquisition partly by drawing up to $15 million on the company’s existing revolving credit facility, with the balance of the cash consideration being funded from Star Equity’s cash on hand.
The merger agreement has been approved by both companies’ Board of Directors. The closing of the transaction is subject to adoption of the merger agreement by stockholders and certain other conditions specified in the merger agreement. The closing of the transaction is expected to occur in the fourth quarter of 2026.
The immediate & ultimate parent undertaking of Harte Hanks UK Limited is Harte Hanks, Inc. a company incorporated in the state of Delaware. Its registered office is 1 Executive Drive, Suite 303 Chelmsford, MA 01824, United States of America. No singular individual has control of Harte-Hanks Inc.
The largest and smallest group of undertakings for which group financial statements have been drawn up including Harte Hanks UK Limited is that headed byHarte Hanks, Inc. whose financial statements are publicly available from the U.S. Securities and Exchange Commission.
The largest and smallest group of undertakings for which group financial statements have been drawn up including Harte Hanks UK Limited is that headed by
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