The directors present the strategic report for the period ended 31 December 2025.
The period under review covers the six months ended 31 December 2025.
In September 2025 the entire share capital of the company was acquired by GB Distributed Power Limited, which ultimate parent entities are Rockland Power Partners IV LP and Rockland Power Partners V LP.
Whilst the change in ownership in September began a period of review and assessment, throughout the period the group continued to operate reserve power generation assets that support the stability and resilience of the electricity network by providing flexible generation capacity when required. The group continues to play a role in maintaining security of supply during periods of peak demand safely and in compliance with applicable regulatory and environmental requirements.
The UK electricity market continued to experience volatility during the period, albeit at lower levels than seen in previous years. Wholesale power prices were influenced by gas market fundamentals, renewable generation output, weather conditions and broader economic factors.
Revenue was primarily derived from electricity generation together with capacity market and ancillary service income where applicable. Turnover for the six month period was £27,558m (year to June 2025: £39,385m) Operating costs were principally driven by fuel consumption, maintenance expenditure and ongoing compliance costs. The loss before taxation for the six month period was £2,116m (year to June 2025: £30,742m)
The directors consider the overall financial performance during the period to be satisfactory and consistent with management expectations.
The group faces a number of risks and uncertainties that could affect future performance, including:
Power market risk
Revenue and profitability are influenced by fluctuations in wholesale electricity prices, gas prices and spark spreads. Changes in market conditions can affect plant dispatch and financial performance.
Operational risk
Unexpected outages, equipment failures or delays in maintenance activities could impact generation availability and operating results.
Regulatory and policy risk
The electricity generation sector is subject to extensive regulation. Changes in energy policy, environmental legislation, carbon pricing mechanisms or market arrangements could affect the group's operations and profitability.
Fuel supply risk
The group's operations depend on the availability and cost of natural gas. Disruptions to supply or significant price movements may adversely affect performance.
Environmental risk
The group is exposed to risks associated with greenhouse gas emissions legislation and evolving environmental standards. Compliance costs may increase over time as regulatory requirements develop.
The directors monitor a range financial performance indicators. In the case of its operational subsidiaries, performance is measured by revenue and EBITDA and compared against the budget set. On a quarterly basis, performance is measured against a detailed financial forecast model and returns a target set at acquisition. Results thus far have been in line with expectations.
Performance against these measures is reviewed regularly to support operational efficiency and long-term value creation.
Health, safety and environment
Health and safety remain the group's highest priority. The group seeks to maintain a strong safety culture and continually reviews its procedures and controls to minimise operational risks.
The power station operated in accordance with applicable environmental permits throughout the period. Environmental performance, including emissions and regulatory compliance, is monitored on an ongoing basis to ensure adherence to legislative requirements and permit obligations.
In accordance with section 172 of the Companies Act 2006, the directors have acted in the way they consider, in good faith, would be most likely to promote the success of the group for the benefit of its members as a whole, whilst having regard to:
The long-term consequences of decisions
The directors aim to promote the long-term success of the group and recognise the importance of the group’s employees, customers, vendors and other stakeholders including the community and the environment. Pursuant to the long-term plan of the group, the directors approve a financial forecast for the current and following year. The directors contribute towards this process by identifying and managing emerging risks and opportunities for the business using their knowledge and expertise of the industry.
The interests of employees
The safety of employees, contractors and members of the public is paramount. The directors recognise that employees are fundamental and core to the business and the delivery of strategic ambitions, and also that the success of the business depends on attracting, retaining and motivating employees. The group maintains close contact with their experienced Operations and Maintenance contractors and HR providers, who are contracted to provide the majority of the Human Resource function and labour to the business. The group monitors the adequacy and effectiveness of policies and procedures and receives regular updates on employment and Health and Safety matters.
Relationships with suppliers, customers and other stakeholders
The directors recognise that fostering business relationships with key stakeholders such as customers and suppliers is essential to the group’s. The group has close relationships with customers, suppliers and industry partners to help position the group as a trusted electricity generator. The group, along with is procurement team, work with suppliers to meet the group’s supply needs.
The impact of operations on the community and the environment
The directors ensure along with their O&M contractor that Environmental, Health and Safety, and social responsibility plans are reviewed and adopted to help protect both people and the environment.
The desirability of maintaining a reputation for high standards of business conduct
The group aims to be a leader in business conduct in order to maintain stakeholder trust and create a business with a successful, sustainable future. All employees are expected to act in accordance with the values of the group and that of the O&M contractor. This reduces the risk of non-compliance in the heavily regulated industry in which the group operates and helps attract and retain high-calibre employees.
The need to act fairly as between shareholders
The group is held directly by a single member, and has two ultimate parent companies which are part of the same group. The directors consider which course of action best enables delivery of our strategy through the long-term, taking into consideration the impact on the GB Flexible Power Limited and Rockland groups. In doing so, the directors act fairly as between the immediate group’s member and the ultimate parents.
Health, safety and environment
The commitment and participation of all employees is vital to efficient and effective occupational risk control. In order to meet our responsibility to protect the environment, staff and the business, the group continues to focus on maintaining a risk aware culture. We continue to work on the potential environmental impacts of energy consumption, waste and travel.
The directors take these factors into account when making strategic and operational decisions and believe that the group's governance framework supports effective decision making and sustainable long-term success.
On behalf of the board
The directors present their annual report and financial statements for the period ended 31 December 2025.
The results for the period are set out on page 11.
No ordinary dividends were paid. The directors do not recommend payment of a further dividend.
The directors who held office during the period and up to the date of signature of the financial statements were as follows:
The group will continue to focus on operational excellence, asset reliability, health and safety performance and prudent cost management. Whilst market conditions remain influenced by regulatory developments, fuel markets and renewable generation levels, the directors believe the group is well positioned to respond to future opportunities and challenges within the UK power sector.
Azets Audit Services Limited were appointed as auditor to the group and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
The company is a subsidiary undertaking of a UK parent company which prepares a Group Directors' Report containing the information required by the Companies (Directors' Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018. The company is included within the consolidated energy and carbon disclosures presented in the Group Directors' Report and is therefore exempt from providing a separate SECR disclosure in its own Directors' Report.
The group incurred a loss of £1,962m for the six-month period ended 31 December 2025 (year ended 30 June 2025: £28,420m). The directors have assessed the group’s ability to continue as a going concern, having considered its current financial position, cash flow forecasts and funding arrangements.
In making this assessment, the directors have considered the potential impact of market uncertainty, including fluctuations in commodity prices, together with other macroeconomic factors that may affect future trading performance and cash flows. The directors have reviewed forecasts covering a period of at least twelve months from the date of approval of these financial statements.
Rockland Power Partners IV, L.P. and Rockland Power Partners V, L.P. have confirmed that they will continue to provide the group with access to such resources as are required, should it be necessary, to enable the group to meet its obligations as they fall due for a period of at least twelve months from the date of approval of these financial statements. Any such support will be provided by Rockland Power Partners IV, L.P. and Rockland Power Partners V, L.P. in proportion to their respective ownership interests in the group. The directors are satisfied that Rockland Power Partners IV, L.P. and Rockland Power Partners V, L.P. have the ability to provide this support and have no reason to believe it will not be forthcoming.
Based on this assessment, the directors have a reasonable expectation that the group will have adequate resources to continue in operational existence and to meet its liabilities as they fall due for a period of at least twelve months from the date of approval of these financial statements. Accordingly, the directors consider it appropriate to prepare the financial statements on the going concern basis. The directors will continue to monitor the group’s performance and the wider economic environment and will take appropriate action as necessary to mitigate any adverse impacts on the business.
We have audited the financial statements of GB Flexible Power Limited (the 'parent company') and its subsidiaries (the 'group') for the period 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).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
The information given in the strategic report and the directors' report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
The strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
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.
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.
The group statement of comprehensive income has been prepared on the basis that all operations are continuing operations.
The notes on pages 17 to 36 form part of these financial statements.
The notes on pages 17 to 36 form part of these financial statements.
The notes on pages 17 to 36 form part of these financial statements.
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 £3,758m (June 2025: £21,301m loss).
The notes on pages 17 to 36 form part of these financial statements.
The notes on pages 17 to 36 form part of these financial statements.
The notes on pages 17 to 36 form part of these financial statements.
GB Flexible Power Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Ground Floor, Templeback, 10 Temple Back, Bristol, United Kingdom, BS1 6FL.
The group consists of GB Flexible Power Limited and all of its subsidiaries.
The financial statements are for a period of less than one year. The financial statements have been shortened to align with the reporting date of its parent company, therefore the comparative amounts presented (including the related notes) are not entirely comparable.
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 £'000.
The financial statements have been prepared under the historical cost convention, modified to include certain financial instruments at fair value.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 GB Flexible Power 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.
The group incurred a loss of £1,962m for the six-month period ended 31 December 2025 (year ended 30 June 2025: £28,420m). The directors have assessed the group’s ability to continue as a going concern, having considered its current financial position, cash flow forecasts and funding arrangements.
In making this assessment, the directors have considered the potential impact of market uncertainty, including fluctuations in commodity prices, together with other macroeconomic factors that may affect future trading performance and cash flows. The directors have reviewed forecasts covering a period of at least twelve months from the date of approval of these financial statements.
Rockland Power Partners IV, L.P. and Rockland Power Partners V, L.P. have confirmed that they will continue to provide the group with access to such resources as are required, should it be necessary, to enable the group to meet its obligations as they fall due for a period of at least twelve months from the date of approval of these financial statements. Any such support will be provided by Rockland Power Partners IV, L.P. and Rockland Power Partners V, L.P. in proportion to their respective ownership interests in the group. The directors are satisfied that Rockland Power Partners IV, L.P. and Rockland Power Partners V, L.P. have the ability to provide this support and have no reason to believe it will not be forthcoming.
Based on this assessment, the directors have a reasonable expectation that the group will have adequate resources to continue in operational existence and to meet its liabilities as they fall due for a period of at least twelve months from the date of approval of these financial statements. Accordingly, the directors consider it appropriate to prepare the financial statements on the going concern basis. The directors will continue to monitor the group’s performance and the wider economic environment and will take appropriate action as necessary to mitigate any adverse impacts on the business.
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 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.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.
Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.
In the parent company financial statements, investments in associates are accounted for at cost less impairment.
Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
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 following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
There are no critical judgements in applying the company's accounting policies.
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 value of goodwill held by the group is reviewed annually for impairment. The recoverability of these balances is considered with reference to the present value of the estimated future cash flows. These calculations use cash flow projections which extend forward forecast business performance together with assumptions surrounding the expected life of the asset, externally prepared forecasts and valuations, and any adjustments required to the discount rate to take account of business risk. The estimated present value of these future cash flows is sensitive to the discount rate and growth rate used in the calculation, all of which require management’s judgement. Testing of the carrying value has been performed during the year, which has involved several scenarios being modelled. The carrying amount of goodwill at the balance sheet date is £nil (June 2025: £nil). An impairment charge of £nil was recorded during period ended 31 December 2025 (June 2025: £13,762m).
Management assesses whether there are indicators of impairment at each reporting date and, where such indicators exist, estimates the recoverable amount of the relevant asset or cash-generating unit. The recoverable amount is determined based on the higher of value in use and fair value less costs to sell. In estimating the recoverable amount, management makes assumptions regarding future cash flows, growth rates, discount rates, expected useful lives, and residual values. Changes in these assumptions may result in a material adjustment to the carrying value of the assets. Management has reviewed the carrying value of tangible assets at the reporting date and believes that the assumptions used are reasonable and support the carrying values recognised in the financial statements.
The provision for decommissioning costs is measured at management's best estimate of the present value of the expenditure required to settle the future obligation. This estimate is determined in accordance with local conditions and requirements, using a discount rate of 6% (June 2025: 4%) reflecting the time value of money and the risks specific to the obligation, based on management’s judgement.
The carrying values of deferred tax assets on the balance sheets are dependent on the estimates of the future cashflows from the group’s business operations. The realisation of the deferred tax asset recognised at the balance sheet date is £13,971m (June 2025: £13,818m) and is dependent on the generation of the future taxable profits. The group recognises the deferred tax assets where it is more likely than not that the benefit will be realised.
The entire turnover is attributable to the group's principal activity.
The average monthly number of persons (including directors) employed by the group and company during the period was:
The group had no employees other than the directors during the period (June 2025: none). The directors did not receive or waive any remuneration during the year (June 2025: £nil). The directors were also directors of other companies within the GB Distributed Power Limited group of companies and their emoluments relate to their services provided to the group as a whole which are paid by other group undertakings.
During the period there were no recharged expenses (June 2025: £nil) from group undertakings for directors emoluments.
The actual credit for the period can be reconciled to the expected credit for the period based on the profit or loss and the standard rate of tax as follows:
Global minimum tax (Pillar Two)
The group is within the scope of the OECD Pillar Two model rules. Pillar Two legislation has been enacted in the UK, the jurisdiction in which the entity is incorporated, and is effective in 2024.
Under the legislation, the group is liable to pay a top-up tax in the UK for the difference between the GloBE effective tax rate for each jurisdiction and the 15% minimum rate. In addition, top-up taxes are payable locally where qualifying domestic minimum top-up taxes have been legislated and are in effect.
The group applies the exception to recognising and disclosing information about deferred tax assets and liabilities related to Pillar Two income taxes, as provided in the amendments to FRS 102 section 29 issued in July 2023.
More information on impairment movements in the period is given in note 2.
More information on impairment movements in the period is given in note 2.
Details of the company's subsidiaries at 31 December 2025 are as follows:
The registered address of all the above subsidiary companies is Ground Floor, Templeback, 10 Temple Back, Bristol, England, BS1 6FL.
Parental guarantee
The directors consider that the above subsidiary undertakings are entitled to exemption from the requirement to have an audit under the provisions of section 479A of the Companies Act 2006 ("the Act"), and the members have not requested these companies to have an audit for the period in question in accordance with section 476 of the Act.
GB Flexible Power Limited has guaranteed the liabilities of the above subsidiary undertakings in order that they qualify for the exemption from audit under section 479A of the Companies Act 2006 in respect of the period ended 31 December 2025.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to the accounting records and the preparation of the financial statements.
Amounts owed by group undertakings are unsecured loans with year end balances amounting to £96,514m (June 2025: £95,957m) net of provisions of £89,951m (June 2025: £89,951m). The loans bear interest at 7.5% (June 2025: 7.5%) and are repayable on demand. No provision was made in the six months to 31 December 2025 (June 2025: £32,042m).
Amounts owed to group undertakings are unsecured and are repayable on demand.
The decommissioning provision is held to cover future obligations to return land, on which there are operational reserve power plants, to their original condition. The amounts are not expected to be utilised for more than 25 years.
The decommissioning provision has been discounted at an annual rate of 6% (June 2025: 4%).
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
The deferred tax asset amounting to £13,971m (June 2025: £13,818m) is recognised because it is likely that there will be sufficient taxable profits in future to recover the asset.
A deferred tax asset amounting to £11,439m (June 2025: £12,336m) has not been recognised because it is more likely than not that there will be insufficient taxable profits in future to recover the asset.
There is a single class of ordinary shares. There are no restrictions on voting, the distribution of dividends and repayment of capital.
On 23 December 2025 the company entered into a mark-to-market forward GBP/USD currency swap derivative contract with a maturity date of 30 December 2030.
The contract is measured at fair value at each reporting date, with the fair value recognised in profit or loss.
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 company has elected the exemption conferred by FRS 102 paragraph 33.7 not to disclose transactions with members of the group headed by GB Flexible Power Limited on the grounds that 100% of the voting rights are controlled within that group.