The directors present the strategic report for the year ended 30 September 2025.
X4 Group is an international group of specialist recruitment brands that act as a talent partner to clients across the STEM sectors of Life Sciences, Technology, Engineering and Finance, offering permanent, contract and retained search staffing solutions.
The group has continued to focus on growing its client base across international locations while hiring and developing quality staff within the UK and US. We continue to invest into our back-office functions, with ongoing development of our personnel and systems, to achieve operational efficiencies and sales process improvements across all teams.
Group turnover decreased by 11% to £27,376,084 (2024: £30,632,313), principally reflecting lower turnover in the United Kingdom and Europe. Despite this, gross profit increased by 9% to £12,075,148 (2024: £11,046,130) and the gross profit margin improved to 44.11% (2024: 36.06%), reflecting an improved mix of higher-margin fee income. The United States continued to grow, with turnover up 20% to £9,298,041, and now represents 34% of group turnover (2024: 25%). X4 Alpha LLC doubled its turnover, while turnover in X4 Staffing Deutschland GmbH fell by 47%.
Operating profit increased to £1,355,433 (2024: £549,740) and profit before taxation increased to £1,245,637 (2024: £364,123). Conversion of gross profit into operating profit improved to 11.2% (2024: 5.0%), with administrative expenses held broadly flat. The average number of fee earners increased to 79 (2024: 75), while average administrative headcount reduced to 21 (2024: 28).
The group’s financial position strengthened during the year. Net assets increased by 40% to £2,202,559 (2024: £1,579,057). Borrowings under the invoice finance facility reduced to £794,697 (2024: £1,960,552) and the CBILS loan was repaid in full, reducing net debt to £273,969 (2024: £1,377,450).
The directors are not aware, at the date of this report, of any likely major changes in the group’s activities in the next year.
X4 Group Consolidated:
Turnover has decreased 11% to £27,376,084 in 2025 from £30,632,313 in 2024.
The Gross Profit Margin increased to 44.11% from 36.06% in the prior year.
Gross profit has increased 9% to £12,075,148 (2025) compared to £11,046,130 (2024).
Operating Profit has increased 147% to a £1,355,433 profit in 2025 from a £549,740 profit in 2024.
X4 Group Ltd (Parent):
Turnover has decreased 14% to £23,791,765 in 2025 from £27,765,915 in 2024.
The Gross Profit Margin increased to 37.53% from 32.69% in the prior year.
Gross profit has decreased 2% to £8,929,977 (2025) compared to £9,076,115 (2024).
Operating Profit has decreased 52% to a £154,682 profit in 2025 from a £319,174 profit in 2024.
X4 Alpha LLC (Subsidiary 1):
Turnover has increased 101% to £2,986,576 in 2025 from £1,482,324 in 2024.
The Gross Profit Margin increased to 100.00% from 98.39% in the prior year.
Gross profit has increased 105% to £2,986,576 (2025) compared to £1,458,440 (2024).
Operating Profit has increased 137% to a £1,309,609 profit in 2025 from a £552,963 profit in 2024.
X4 Staffing Deutschland GmbH (Subsidiary 2):
Turnover has decreased 47% to £804,734 in 2025 from £1,513,334 in 2024.
The Gross Profit Margin increased to 45.43% from 45.16% in the prior year.
Gross profit has decreased 47% to £365,586 (2025) compared to £683,457 (2024).
Operating loss has decreased 43% to a £72,036 loss in 2025 from a £125,737 loss in 2024.
X4 Tech Staffing Inc (Subsidiary 3):
Turnover has decreased 100% to £nil in 2025 from £154,618 in 2024.
The Gross Profit Margin is not applicable in 2025 as no turnover was generated (2024: 72.43%).
Gross profit has decreased 100% to £nil (2025) compared to £111,996 (2024).
Operating loss has decreased 81% to a £39,627 loss in 2025 from a £205,039 loss in 2024.
X4 Group’s principal financial risks comprise a global uncertainty in the market, cash flow (liquidity), foreign exchange and credit risks.
To mitigate this we focus on sectors that are more resilient to the fluctuations of the economy and have a business that is more geographically diverse. We offer both permanent and contractor solutions to our clients and remain agile to new opportunities in the regions we operate.
The Directors regularly review financial requirements of the business and the associated risks. The group is financed through a combination of retained earnings and an invoice finance facility. We maintain a healthy balance sheet, use variance analysis for cost control and review regular monthly re-forecasts on P&L performance across all group entities.
Liquidity risks are managed by monitoring Group and subsidiary cash flow forecasts, following credit control procedures and the use of an invoice finance facility for £GBP, €EUR and $USD debtors. The group’s reliance on the facility reduced significantly during the year, with borrowings of £794,697 at 30 September 2025 (2024: £1,960,552).
The group’s continued expansion globally increases its exposure to foreign exchange risk, especially $USD, with the United States now representing 34% of group turnover. This is addressed by matching costs and revenue in the same local currency and reviewing exchange exposure on a monthly basis.
Trade debtors are managed by monitoring their credit worthiness prior to carrying out business, utilising our credit insurance facility, working closely with customers to ensure debt is within acceptable credit limits and taking remedial action where necessary.
While the market conditions remain uncertain, the Board believe the group is well placed to benefit from the ongoing talent resourcing demand from clients across all our sectors and regions. We have continued to improve our internal processes, invested in new systems and strengthened management and sales teams to create a stronger and more effective organisation and fee growth in FY26.
On behalf of the board
The directors present their annual report and financial statements for the year ended 30 September 2025.
The results for the year are set out on page 10.
Ordinary dividends were paid amounting to £506,700. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
The auditor, UHY Hacker Young, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
We have audited the financial statements of X4 Group Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 September 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).
Basis for opinion
Conclusions relating to going concern
Other information
Opinions on other matters prescribed by the Companies Act 2006
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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Based on our understanding of the company, the group and the recruitment industries in which it operates; we identified that the principal risks of non-compliance with laws and regulations related to the acts by the company, which were contrary to applicable laws and regulations including tax legislation, pensions legislation, employment and health and safety regulation, anti-bribery, corruption and fraud. We considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to revenue recognition and management override of controls.
Audit procedures performed included:
Enquiries were made of management relating to compliance with key laws and regulations as being of significance to the group and company.
Enquiries were made of management and those charged with governance around any actual or potential litigation and claims. A review of a sample of such expenditure was undertaken as part of our substantive audit review work.
We performed substantive testing of revenue recognition by selecting a sample of recorded sales and tracing these to corresponding customer purchase orders and employee timesheets. This procedure was designed to verify that revenue was recognised in accordance with applicable accounting standards, specifically confirming that services were rendered or goods delivered within the appropriate reporting period. The results supported the conclusion that revenue was appropriately recorded.
Auditing the risk of management override of controls, including thorough testing of journals entries using data analytics software. This led to the review of transactions considered unusual, abnormally large, appearing outside the normal course of business and various other criteria. Any such instances were then investigated, and explanations sought from informed management and documented.
We made enquiries of management to obtain an understanding of the entity’s policies and procedures on fraud risks including knowledge of any actual, suspected, or alleged fraud. Potential opportunities for fraud were also discussed during the audit team planning meeting so that they could apply professional scepticism when conducting their work.
We undertook a review of a range of transactions and reviewed these to underlying documentation at the same time being mindful of any discrepancies and potential errors and made necessary enquiries of informed management in relation to the same.
There are inherent limitations in the audit procedures described above and the further removed noncompliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. Such laws and regulations the auditor identified as being of significance in the context of the entity.
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.
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.
The profit and loss account has been prepared on the basis that all operations are continuing operations.
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 year was £655,854 (2024 - £72,021 profit).
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
X4 Group Ltd (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Quadrant House - Floor 6, 4 Thomas More Square, London, E1W 1YW.
The group consists of X4 Group Ltd 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 £.
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 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The consolidated group financial statements consist of the financial statements of the parent company X4 Group Ltd 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 30 September 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.
The group delivered a significantly improved result in the year, with operating profit of £1,355,433 (2024: £549,740) and a net cash inflow from operating activities of £1,661,816. Borrowings under the invoice finance facility reduced to £794,697 (2024: £1,960,552), the CBILS loan was repaid in full and net debt reduced to £273,969 (2024: £1,377,450).
The group's income is increasingly weighted towards the United States, which represented 34% of group turnover in the year (2024: 25%), alongside the established UK business. The directors consider that this geographic spread, across permanent, contract and retained services in the Life Sciences, Technology, Engineering and Finance sectors, reduces the group's reliance on any single market.
Trading since the year end has been ahead of the directors' expectations, with growth in both gross profit and operating profit forecast for the year ending 30 September 2026. This growth is expected to be driven principally by a significantly improved performance in the company, the group's UK trading entity, supported by the further expansion of its contract and permanent divisions into US markets. The group continues to have access to its invoice finance facility for GBP, EUR and USD debtors, and the forecasts show the group operating within its available facilities throughout the forecast period.
The directors have prepared cash flow forecasts for the group and company covering a period of at least twelve months from the date of approval of these financial statements. Having considered these forecasts, including reasonably possible downside scenarios, the directors have a reasonable expectation that the group and company have adequate resources to continue in operational existence for the foreseeable future. They therefore 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.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
Revenue from contracts for the provision of contract staff in realised over the period in which the service is provided. Revenue for the permanent placement of staff is recognised on the start date of the employee.
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.
At each reporting period end date, the group reviews the carrying amounts of its tangible 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.
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.
Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted using the Blacks and Scholes model. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.
The expense in relation to options over the parent company’s shares granted to employees of a subsidiary is recognised by the company as a capital contribution, and presented as an increase in the company’s investment in that subsidiary.
When the terms and conditions of equity-settled share-based payments at the time they were granted are subsequently modified, the fair value of the share-based payment under the original terms and conditions and under the modified terms and conditions are both determined at the date of the modification. Any excess of the modified fair value over the original fair value is recognised over the remaining vesting period in addition to the grant date fair value of the original share-based payment. The share-based payment expense is not adjusted if the modified fair value is less than the original fair value.
Cancellations or settlements (including those resulting from employee redundancies) are treated as an acceleration of vesting and the amount that would have been recognised over the remaining vesting period is recognised immediately.
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.
An analysis of the group's turnover is as follows:
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
No one besides the directors are considered to be key management personnel.
The actual 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:
Details of the company's subsidiaries at 30 September 2025 are as follows:
The amount shown as other loans is debt factoring facility and is secured by fixed and floating charges over all the property or undertakings of the company.
In the prior year the bank loan was the CBILS loan to the X4 Group Ltd. The loan was full repayed in the year.
Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
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 options outstanding at 30 September 2025 had an exercise price ranging from £2.0058 to £3.683, and a remaining contractual life of 7 years.
The weighted average fair value of options granted in the year was determined using the Black-Scholes option pricing model. The Black-Scholes model is considered to apply the most appropriate valuation method. The expected life used in the model has been adjusted, based on management’s best estimate, for the effect of non-transferability, exercise restrictions, and behavioural considerations.
Non-vesting conditions and market conditions are taken into account when estimating the fair value of the option at grant date. Service conditions and non-market performance conditions are taken into account by adjusting the number of options expected to vest at each reporting date.
The company holds its principal office under an operating lease.
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:
During the year the group recognised income of £54,141 (2024: £40,057) charged to X4 Group (New Zealand) Ltd, a company under common control. As at the balance sheet date £13,858 (2024: £nil) was owed to this company.
As at the balance sheet date £249,677 (2024: £267,083) was receivable from X4 NZ Holdings Ltd and £55,169 (2024: £58,131) was owed to X4 Contract Solutions Ltd. Both of these are companies under common control.