Registration number: 11346496

ILS Operations Limited

Contents

ILS Operations Limited

Company Information

ILS Operations Limited

Strategic Report for the Year Ended 31 December 2025

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

Principal activity

The principal activity of the company is an operator of a group of McDonald's restaurant franchises.

Fair review of the business

The results for the year and the financial position at the end of the year are shown in the annexed financial statements. The directors aim to present a fair review of the development and performance of the company during the year under review and of its position at the end of the year.

The principal activity of the company during the year continued to be a franchise operator of a group of McDonald’s restaurants.

During the year digital sales via McDelivery, mobile apps and self-order kiosks have continued to increase as the company seeks to make the food ordering process ever more customer friendly. The company has continued to invest in the business and in the development and training of its employees, as well as continued investment in IT and store equipment.

As an operator of a group of McDonald's restaurants the directors consider the company's key performance indicators to be turnover and gross profit. Turnover for the year increased by 4.2%, with a corresponding increase in gross profit of almost 10%. Net profit before taxation amounted to £1,2783,598 for the year, compared to a profit of £712,186 in the previous year.

The directors believe that the trading environment in which the company operates will continue to be challenging but remain optimistic regarding future trading and are committed to increasing both future turnover and profitability and to continuing the company’s reinvestment program.

ILS Operations Limited

Strategic Report for the Year Ended 31 December 2025

Principal risks and uncertainties

The company operates in a highly competitive market with high levels of price sensitivity. Consumer behaviour can impact the company's turnover and profitability. The company continually assesses these risks and mitigates them by adopting a policy of constantly reviewing its pricing strategy with ongoing market research.

The company remains exposed to periods of food cost inflation together with the variability of commodity prices, both of which impact on profitability. The company continually assesses any risks identified, with the aim of mitigating the threats these may have on the company's operations and profitability. The company's supply chain is closely overseen and supported by McDonald's, who endeavour to negotiate effectively on behalf of all franchisees to ensure better purchasing terms. This helps as much as possible to protect the company from risks associated with fluctuating food costs.

The company is also inherently exposed to pressures within the labour market and to wage cost inflation. The company mitigates this risk by a policy of adopting remuneration and benefits packages designed to be competitive within the market as well as ensuring full compliance with labour market regulations, with employment policies to allow fulfilling career opportunities for all employees.

The company’s operations demand a high level of compliance within a wide range of regulatory requirements, in particular –
- health and safety
- hygiene procedures
- employment laws
- licensing

The above, in common with various other areas, are monitored in detail by McDonald’s with assistance being given to all franchisees to help meet the various requirements.

By its very nature, the quick service restaurant market is extremely competitive, with large numbers of companies operating in the sector. In order to remain at the forefront of the industry, McDonald’s have developed dedicated teams whose focus is to ensure that they remain the leading brand in the market.

Financial Instruments -
Financial risk management objectives and policies
The company’s principle financial instruments comprise bank balances, trade creditors and bank loans. The main purpose of these instruments is to finance the company’s operations and to ensure the smooth running of the company’s operations.

Due to the nature of the financial instruments used by the company there is no exposure to price risk.

In respect of bank balances, the liquidity risk is managed by maintaining a balance to ensure the continuity of trading, through the use of detailed cash flow analysis, forecasts and projections which are regularly updated. In addition, the company has access to overdraft facilities from its bankers which are repayable on demand, should the business require them.

In respect of bank loans, these are provided by financial institutions. The interest rate on these loans is variable, although usually the monthly repayments are fixed. The company manages the liquidity risk by ensuring that there are sufficient funds to meet the payments through the constant review and updating of cashflow forecasts. The interest rate is managed through regular reviews of current and expected future interest rates.

Trade creditor liquidity risk is managed by ensuring sufficient funds are available to meet amounts due.

ILS Operations Limited

Strategic Report for the Year Ended 31 December 2025

Section 172(1) statement

The success of the Company is the driving factor behind all decisions made by the Director. Decision making processes are structured to enable the Director to evaluate the merit of proposed business activities and the likely consequences of decisions taken over the short, medium and long term. The director remains mindful that any strategic decisions taken can have long term implications for the business and its stakeholders, and these implications are carefully assessed. An example of this is in decisions taken relating to capital investment in terms of possible new store acquisitions and equipment upgrades.

Our people are key to our success. That is why we endeavour to create jobs and opportunities for all our people, regardless of gender, age, or life stage that enhance their work experience. Understanding how our people feel about McDonald’s is vital. The director takes active steps to ensure that the suggestions, views and interests of the workforce are incorporated and considered as part of any decision-making process, helping to ensure that our employees are given the right support to help achieve their potential. We have developed various employee communication channels such as Workplace, MyStuff and the McDonald’s UK Intranet, which provide weekly operations updates, employee assistance programs and a means for employees to share ideas and feedback. We also conduct regular surveys into our employee’s job satisfaction and how they feel about their role in the company. We encourage and provide access to online learning and development, as well as providing our people with a mobile friendly platform to manage their own data, holidays, time off and access to view their wage slips.

Our customers are the reason for our existence and we therefore strive to provide high quality food with superior service in a clean and welcoming environment, all at an exceptional value. Long-term commitment to supply McDonald’s UK, has enabled our suppliers to grow with us and drive positive change within their own businesses.

The director carefully considers the impact of the business on communities and the environments in which the company operates. We arrange regular litter collections in the local area around our restaurants. Recycling units are installed around our restaurants and our paper cups are sent to specialist recycling centres in the UK. We endeavour to help our customers build communities, support charitable organisations, and use our size, scope and resources to help make local communities and the environment a better place.

In all our activities the director requires that employees and suppliers conduct business with the highest ethical and professional standards by adhering to our Standards of Business Conduct set by McDonald’s Corporation.

Engagement with employees

Our workforce is our most valuable asset and is one of the main reasons for the success of the company and brand. The company invests strongly in training, coaching, and skills acquisition. The personal development and improvement of our employees is a key aim of the Company’s strategy. We strive to be a responsible employer in our approach to the pay and benefits of employees and the health, safety and wellbeing of our employees is one of the primary considerations in the way we do business.

Engagement with suppliers, customers and other relationships

As a company we endeavour to build long-term commitments with our suppliers which has enabled them to grow with us and drive positive change within their own businesses. The company recognises that relationships with suppliers are important to its long-term success and is briefed on supplier feedback and issues on a regular basis.

We also endeavour to forge positive relationships with our customers by providing high quality food and an excellent service in a clean and welcoming environment at a competitive price.

ILS Operations Limited

Strategic Report for the Year Ended 31 December 2025

Approved and authorised by the Board on 7 October 2026 and signed on its behalf by:
 

ILS Operations Limited

Directors' Report for the Year Ended 31 December 2025

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

Directors of the company

The directors who held office during the year were as follows:

Mr I L Stephenson

Mrs E Stephenson

Results and dividends
The profit for the year, after taxation, amounted to £918,169 (2024 - £576,552).

During the year, dividends paid amounted to £275,000 (2024: £200,000). The directors do not recommend the payment of a final dividend.
 

Financial instruments

Objectives and policies

The company’s principle financial instruments comprise bank balances, trade creditors and bank loans. The main purpose of these instruments is to finance the company’s operations and to ensure the smooth running of the company’s operations.

Due to the nature of the financial instruments used by the company there is no exposure to price risk.

In respect of bank balances, the liquidity risk is managed by maintaining a balance to ensure the continuity of trading, through the use of detailed cash flow analysis, forecasts and projections which are regularly updated. In addition, the company has access to overdraft facilities from its bankers which are repayable on demand, should the business require them.

In respect of bank loans, these are provided by financial institutions. The interest rate on these loans is variable, although usually the monthly repayments are fixed. The company manages the liquidity risk by ensuring that there are sufficient funds to meet the payments through the constant review and updating of cashflow forecasts. The interest rate is managed through regular reviews of current and expected future interest rates.

Trade creditor liquidity risk is managed by ensuring sufficient funds are available to meet amounts due.

Price risk, credit risk, liquidity risk and cash flow risk

The main risks arising from the company’s financial instruments are interest risk and liquidity risk. The board reviews and agrees policies for managing each of these risks as summarised below –

Interest rate risk – the company’s exposure to market risk for changes in interest rates is limited to bank loans. Additional requirements for medium to long term debt are reviewed by the directors based on the company’s forecast requirements.

Liquidity risk – the company’s objective is to maintain a balance between continuity of funding and flexibility, by the utilisation of cash and bank loans.

ILS Operations Limited

Directors' Report for the Year Ended 31 December 2025

Employment of disabled persons

Employee involvement

ILS Operations Limited

Directors' Report for the Year Ended 31 December 2025

Streamlined Energy and Carbon Reporting

Streamlined Energy and Carbon Reporting (SECR) is a mandatory regulatory requirement for all quoted, larqe unquoted and large Limited Liability Partnerships (LLPs), in the UK.

It covers financial reporting years starting on 1st of April 2019, or after this date.

Reporting obligations for unquoted large companies covers UK energy use and GHG emissions for:
• Electricity
• Gas
• Transport fuel

Other material Scope 1 and 2 emissions are also expected to be included.

Additional required information includes energy intensity ratio and energy efficiency action, on an annual basis.

This report summarises ILS Operations Limited energy usage, their associated emissions, energy efficiency narrative, reporting and estimation methodology.

ILS Operations Limited is a private limited company, focusing on operating quick service restaurants. As such, it is obliged to report its energy, emissions and energy efficiency actions on an annual basis, through SECR.

GHG emissions decreased by 24% from 1,402.59 tCO₂e in 2024 to 1,067.70 tCO₂e in 2025, primarily driven by significant reductions in electricity and natural gas emissions. Refrigerant emissions also fell substantially, while transport and waste emissions were newly reported in 2025 but had only a minor impact on total emissions.

Energy efficiency measures over the year include -

Refrigeration investment, including a comprehensive PPM program to ensure that all units maintain optimum efficiency. A main chiller and freezer replacement was completed at one site.

HVAC systems have been set via programmable smart thermostats, with PPM programs in place to maintain optimum efficiency of all components.

Investment in several key equipment upgrades, including grills, vats and beverage units, with additional PPM programs in place.

Boiler replacement and upgrade in one site.

Staff behaviour changes have been encouraged via monthly smart usage data analysis reports, encouraging energy savings utilising fire up and fire down schedules. All sites completed energy efficiency audits to identify opportunities.

Where possible teams have utilised virtual group meetings to minimise non-essential business travel for staff.

ILS Operations Limited

Directors' Report for the Year Ended 31 December 2025

Strategy

ILS Operations Limited

Directors' Report for the Year Ended 31 December 2025

Metrics and targets

Emissions and energy consumption

Summary of greenhouse gas emissions and energy consumption for the year ended 31 December 2025:

Disclosure of information to the auditors

Reappointment of auditors

The auditors Manex Accountants Ltd are deemed to be reappointed under section 487(2) of the Companies Act 2006.

Approved and authorised by the Board on 7 October 2026 and signed on its behalf by:
 

ILS Operations Limited

Statement of Directors' Responsibilities

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

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 enable them to ensure that the financial statements comply with the Companies Act 2006 and in accordance with FRS 102. 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.

ILS Operations Limited

Independent Auditor's Report to the Members of ILS Operations Limited

Opinion

We have audited the financial statements of ILS Operations Limited (the 'company') for the year ended 31 December 2025, which comprise the Income Statement, Statement of financial position, Statement of Changes in Equity, Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

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 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 director's 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 original financial statements were 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 directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.

We have nothing to report in this regard.

ILS Operations Limited

Independent Auditor's Report to the Members of ILS Operations Limited

Opinion on other matter prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of our knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report and the Directors' Report.

Auditor 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

ILS Operations Limited

Independent Auditor's Report to the Members of ILS Operations Limited

We obtained an understanding of the legal and regulatory frameworks applicable to the company and the industry in which it operates. We determined that the following laws and regulations were most significant: The Companies Act 2006/FRS 102, Employment Law and Waste, Health and Safety. We enquired of management and those responsible for legal and compliance procedures to obtain an understanding of how the company is complying with those legal and regulatory frameworks and whether they had any knowledge of actual or suspected fraud. We corroborated the results of our enquiries through our discussions with the directors and management. We did not identify any matters relating to non-compliance with laws and regulations or matters in relation to fraud.

In assessing the potential risks of material misstatements, we obtained an understanding of the company’s operations, including its objectives and strategies to understand the expected financial statement disclosures and business risks that may result in risks of material misstatement;

In assessing the appropriateness of the collective competence and capabilities of the engagement team the engagement partner considered the engagement team’s :
 Understanding of, and practical experience with, audit engagements of a similar nature and complexity through appropriate training and participation,
 The specialist skills required and
 Knowledge of the industry in which the client operates.

We assessed the susceptibility of the company’s financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included:
 Assessing the design effectiveness of controls management has in place to prevent and detect fraud;
 Challenging assumptions and judgements made by management in its significant accounting estimates;
 Identifying and testing journal entries, in particular manual journal entries made at year end for financial statement preparation; and
 Assessing the extent of compliance with the relevant laws and regulations as part of our procedures on the related financial statement item.

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.

......................................
Clinton Meehan BSc FCA (Senior Statutory Auditor)
For and on behalf of Manex Accountants Ltd, Statutory Auditor
 9 Castle Court 2
Castlegate Way
Dudley
West Midlands
DY1 4RD

7 October 2026

ILS Operations Limited

Income Statement for the Year Ended 31 December 2025

The above results were derived from continuing operations.

The company has no recognised gains or losses for the year other than the results above.

ILS Operations Limited

(Registration number: 11346496)
Statement of financial position as at 31 December 2025

Approved and authorised by the Board on 7 October 2026 and signed on its behalf by:
 

ILS Operations Limited

Statement of Changes in Equity for the Year Ended 31 December 2025

ILS Operations Limited

Statement of Cash Flows for the Year Ended 31 December 2025

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

The company is a private company limited by share capital, incorporated in England.

The address of its registered office is:
McDonald's Restaurant
935/943 London Road
Thornton Heath
CR7 6XJ

These financial statements were authorised for issue by the Board on 7 October 2026.

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

Basis of preparation

Going concern

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

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

Judgements

Revenue recognition

Tax

Property plant and equipment

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

Depreciation

Goodwill

Intangible assets

Amortisation

Investments

Cash and cash equivalents

Trade debtors

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

Inventories

Trade creditors

Borrowings

Leases

Share capital

Dividends

Defined contribution pension obligation

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

The analysis of the company's turnover for the year from continuing operations is as follows:

The analysis of the company's other operating income for the year is as follows:

The analysis of the company's other gains and losses for the year is as follows:

Arrived at after charging/(crediting)

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

The aggregate payroll costs (including directors' remuneration) were as follows:

The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:

The directors' remuneration for the year was as follows:

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

Tax charged/(credited) in the income statement

The tax on profit before tax for the year is lower than the standard rate of corporation tax in the UK (2024 - lower than the standard rate of corporation tax in the UK) of 25% (2024 - 25%).

The differences are reconciled below:

Deferred tax

Deferred tax assets and liabilities

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

	Goodwill  £	Licence fees  £	Stamp duty  £	Total £
Cost or valuation
At 1 January 2025	1,870,843	300,000	129,369	2,300,212
At 31 December 2025	1,870,843	300,000	129,369	2,300,212
Amortisation
At 1 January 2025	416,837	54,775	39,233	510,845
Amortisation charge	98,056	15,144	8,063	121,263
At 31 December 2025	514,893	69,919	47,296	632,108
Carrying amount
At 31 December 2025	1,355,950	230,081	82,073	1,668,104
At 31 December 2024	1,454,006	245,225	90,136	1,789,367

14	Property plant and equipment

	Plant and equipment  £	Motor vehicles  £	Total £
Cost or valuation
At 1 January 2025	10,402,463	228,991	10,631,454
Additions	311,596	-	311,596
Disposals	(7,742)	-	(7,742)
At 31 December 2025	10,706,317	228,991	10,935,308
Depreciation
At 1 January 2025	5,034,347	52,522	5,086,869
Charge for the year	1,375,782	22,899	1,398,681
Eliminated on disposal	(645)	-	(645)
At 31 December 2025	6,409,484	75,421	6,484,905
Carrying amount
At 31 December 2025	4,296,833	153,570	4,450,403
At 31 December 2024	5,368,116	176,469	5,544,585

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

	Financial assets at cost less impairment £	Total £
Non-current financial assets
Cost or valuation
At 1 January 2025	13,750	13,750
At 31 December 2025	13,750	13,750
Carrying amount
At 31 December 2025	13,750	13,750

16	Inventories

	2025 £	2024 £
Closing stocks of food and drink, paper, and non-products	199,841	233,521

17

Debtors

Current	2025 £	2024 £
Trade debtors	1,706	-
Other debtors	2,652	31,225
Prepayments	305,266	172,705
	309,624	203,930

18	Cash and cash equivalents

	2025 £	2024 £
Cash on hand	24,653	24,186
Cash at bank	4,776,836	3,330,371
	4,801,489	3,354,557

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

Defined contribution pension scheme

The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £385,870 (2024 - £150,849).

Contributions totalling £12,178 (2024 - £10,793) were payable to the scheme at the end of the year and are included in creditors.

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

Allotted, called up and fully paid shares

Non-current loans and borrowings

Current loans and borrowings

Bank borrowings

Operating leases

The total of future minimum lease payments is as follows:

The amount of non-cancellable operating lease payments recognised as an expense during the year was £4,164,848 (2024 - £3,865,555).

ILS Operations Limited

Notes to the Financial Statements for the Year Ended 31 December 2025

Interim dividends paid

The ultimate controlling party is Mr I L Stephenson.