The directors of Silentnight Group Limited (‘the company’) present their strategic report on the affairs of the Company together with the audited financial statements and independent auditor’s report for the year ended 31 January 2026. The directors, in preparing this strategic report, have complied with s414C of the Companies Act 2006 and S172 relating to the directors duties to promote the success of the company.

The company’s principal activity is the manufacture and distribution of sleep products including mattresses, bed bases and headboards. The company’s strategy is to focus on developing its market leading products with a clear vision to be the most trusted sleep brand in the UK, delivering excellent quality, sublime customer and consumer experience and be an employer of choice in the community. The company’s product portfolio makes it the clear market leader in the UK. The company manufactures its product from its site in Barnoldswick.

The results for the financial period are given in the income statement on page 12 and in the notes to the financial statements. Comparative results are for the year ended 31 January 2025. The profit for the period after taxation amounted to £8,821,000 (2025: £10,429,000 profit). See the key performance indicators section for explanations into the movements. On an EBITDA measurement basis, profit amounted to £13,048,000, prior period 2025 £14,857,000.

The principal risks and uncertainties facing the company are broadly viewed as the competitive environment, legislative framework, raw materials, exchange rates, credit and liquidity.

Competitive environment

In the UK, the company is reliant on certain major customers for sales of product ranges which are subject to ongoing review. The company is exposed to threats from competition, including imported products, as well as fluctuations in the size of the overall market. The company aims to mitigate competitive risks by continuing to maintain its position as the UK’s most trusted sleep brand through a focus on innovation and delivering quality products and positive customer and consumer experience.

Legislative framework

The company may be exposed to changes in the legislative framework. In addition, compliance related costs and failure to comply with such legislation could result in increased costs and / or reduced sales for the company. The directors regularly monitor compliance and ensure that they are made aware of legislative changes.

Raw materials

The company purchases raw materials to use in the manufacture of its products, including timber, steel and foam. The price of these products can be volatile, and the company is therefore exposed to movements in the price of the commodity products. During the period the company has seen rises in some of its raw material costs. The company has absorbed these increases where possible but has also had to pass some of this on to its customers.

Exchange rates

The company has considered the impact of foreign exchange risk, and the potential gains and losses arising from transactions in foreign currencies and has a mitigation plan.

Technical

The company relies heavily on its computer systems and associated infrastructure. Failure of such systems would constitute a risk to the company. The company has a series of risk management tools in place, including disaster recovery procedures.

See note 1 for the assessment of the impact of these risks and uncertainties on the going concern assumption.

The company’s key financial and other performance indicators during the financial period were as follows:

Turnover has decreased by 7%, following a large contract rollout inflating the prior period. As a consequence of the lower turnover there was a decrease in the EBITDA of 12%. Profit after tax decreased by 15% due to the same reasons.

The company’s ‘quick ratio’ (current assets as a percentage of current liabilities) has increased by 16%, primarily due to a change in the customer mix versus the same period last year. The year-on-year increase in debtors is attributable to higher intercompany receivables arising from incremental funding provided to Group undertaking. These balances reflect financing arrangements implemented during the year to facilitate upstream distributions to shareholders.

The directors aim to continue the management approach which has resulted in the company growing market share and its position as the UK market leader. They consider that the challenges facing consumer trade, and the overall economy, will remain during 2026/27, however, a strategy is in place to deliver sustained strong performance from continuing operations.

The company is committed to providing a safe and healthy work environment for all employees, visitors, and other stakeholders. This is achieved through robust health and safety policies, regular communication, measurement, training, and proactive risk assessments. The company also prioritises employee involvement in health and safety matters through local staff committees and open communication channels. The company gives high priority to all environmental, health and safety matters / concerns and is committed to compliance with applicable environmental, health and safety regulations in all territories where it conducts business.

The board ensures that all decisions are taken for the long term, and both collectively and individually aims to always uphold the highest standard of conduct. Similarly, the board acknowledges that the business can only grow and prosper over the long-term if it understands and respects the views and needs of the group’s investors, customers, employees, suppliers and other stakeholders to whom it is accountable, as well as the environment it operates within.

Typically, the board fulfils its duties partly through a governance framework that delegates day-to-day decision making to the employees of the company. The board recognises that such delegation needs to be part of a robust governance structure, which covers our values, how we engage with our stakeholders, and how the board assures itself that the governance structure and systems of controls continue to be robust.

The directors set the agenda for each board meeting to ensure that the requirements of section 172 are always met.

The key stakeholder groups are set out below. The many and varied engagement processes help lead to give a better understanding of what matters to the stakeholders. Their views and needs, as well as the consequences of any decision in the long term are then considered in the business decisions made by the board and across the entire group, at all levels. This is through various methods, including: direct engagement by board members, receiving reports and updates from members of management who engage with such groups, and coverage in our board papers of relevant stakeholder interests with regard to proposed plans.

Workforce: The strength of the business is built on the dedication of all the employees and ensuring that everyone understands their roles and responsibilities. The interests of all employees are considered when making decisions. The workforce relies on the business to provide stable employment and opportunities to realise their potential in a working environment where they can be at their best.

The board of directors regards employee engagement as a matter of great importance and actively aims to improve the board’s understanding of the employees’ views and interests as well as improving the employees’ understanding of the group’s performance.

The business invests in training, coaching and skills development to ensure the required knowledge and behaviours are aligned with the group’s strategy as it is important for employees to feel connected to the group’s purpose.

Senior managers conduct regular briefings with their departments and the organisation as a whole to ensure the effective dissemination of information to foster employee engagement. The updates give employees a platform to raise questions and make suggestions to the board and senior management team.

The company operates an employee forum, which provides a two-way communication process, involving and engaging employees through consultation and enabling them to contribute to the success of the business. It also offers management the opportunity to engage over business related issues and gain commitment for change.

Consumers: Our consumers are our reason for existing. It is essential that the business can design and manufacture high quality products that live up to the key values of quality, service and innovation. In doing this we will build our brand value and loyalty.

Customers: The company recognises that the partnership with third party customers is central to its strategy and the continuing success of its business. The company operates with a customer base across multiple channels. These customers are vital to the success of the company. There are periodic meetings between the customers the senior managers and the directors of the company to understand the strategic direction of the company.

The company’s strategy is based on sustainable business relationships with our customers. The company seeks to re-invest for growth and innovation. The company is committed to continuous development of its processes to improve the overall customer experience.

Investors: The group relies on our providers of debt funding as essential sources of capital to further business objectives and to protect and manage their investments in a responsible and sustainable way that generates value.

Suppliers: The company perceives its supplier network as a major contribution to value creation, quality and innovation and hence to our success. The company’s collaboration with its suppliers is based on a mutual understanding of product and production quality, security of supplies, competitive prices and innovation, as well as the continuous integration of sustainability requirements.

Suppliers have a significant impact on our sustainability performance. It is therefore essential that our suppliers meet standards which require compliance with internationally recognised human rights, as well as labour and social standards.

Regulators: The company seeks to enjoy a constructive and cooperative relationship with the bodies that authorise and regulate our business activities. They rely on the business to comply with applicable laws, regulation and licence conditions.

Communities and the environment: Communities and the wider public expect the business to act as a responsible company and neighbour and to minimise any adverse impact there might be on local communities and the environment. Also refer to the ESG policy in the financial statements of the parent company The Sleep Group Topco Limited.

On behalf of the board

The directors present their annual report and financial statements for the year ended 31 January 2026.

The results for the year are set out on page 12.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

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

The Sleep Group Topco Limited, the ultimate parent company of the group, has made qualifying third party indemnity provisions for the benefit of the company’s directors which were made in prior years and remain in force at the date of this report.

The company continues to invest in research and development, expensing costs of £942,000 (2025: £1,103,000) in the period in researching and developing new products and processes. As a result of the investment in research and development, new products continue to be launched, which are expected to continue to make a significant contribution to the growth of the business. The directors regard investment in this area as a pre-requisite for success in the medium to long-term future.

The group is committed to equality and fairness. We recognise our social and legal obligations, but most importantly, we value the broad diversity of our employees. Individuals with different cultures and experiences, who can offer different ideas and perspectives, are instrumental to the success of our business and we aim to ensure that no person receives less favourable treatment on the grounds of age, disability, gender reassignment, marriage and civil partnership, pregnancy or maternity, race, religion, sex or sexual orientation, and we ensure high standards of equality are upheld at every step of the employee journey. Our comprehensive Equality and Diversity Policy clearly sets out our commitment and the expectations of all colleagues.

The group endeavours to consult with employee representatives, on behalf of the workforce, on all matters which directly affect their employment. The group’s policy is to meet with an employee forum monthly to provide business updates and gain colleague insights.

Information about matters of concern to employees is given through meetings, presentations, bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the company's performance.

The company has elected to dispense with the holding of annual general meetings, the laying of financial statements before the group in general meeting and the annual appointment of auditor. Grant Thornton UK LLP have indicated their willingness to be reappointed for another term and appropriate arrangements have been put in place for them to be deemed reappointed in the absence of an annual general meeting.

As the Energy and Carbon report is included in the group accounts of the company's parent The Sleep Group Topco Limited, the company is exempt from including this in their own accounts. Copies of the consolidated financial statements for The Sleep Group Topco Limited can be obtained from Long Ing Business Park, Long Ing Lane, Barnoldswick, United Kingdom, BB18 6BJ.

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of financial risk management and future developments. It has done so in respect of financial risk management and future developments on pages 1 and 2 respectively.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, each director has taken all the necessary steps that they ought to have taken as a director in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information. This confirmation is given and should be interpreted in accordance with the provisions of s418 of the Companies Act 2006.

The group has a third-party loan of £65m taken out in January 2026, which replaced a £43m loan taken out in June 2024. The group also has access to a £10m revolving credit facility, of which it had utilised £1.5m at the balance sheet date. The loan expires in June 2030 and the revolving credit facility expires in December 2028. The financial restructuring carried out in January 2026, was to refinance on improved terms, on the back of the improved financial performance and position of the group, and to also carry out a redemption of the remaining preference shares, returning funds to shareholders and in doing so, replacing high cost existing borrowings with a lower cost instrument.

The financing reorganisation in January 2026 has further ensured the group has adequate resources to continue to develop and grow the business, especially within the contract sector, and is expected to continue in operational existence for the foreseeable future, and for at least 12 months from the date of the financial statements to July 2027. The Directors have prepared detailed financial forecasts and cash flow projections covering a period of at least 12 months from the date of approval of these financial statements. These forecasts incorporate assumptions regarding future trading performance, working capital requirements and capital expenditure. As part of the going concern assessment, the Directors have also considered reasonably possible downside scenarios including sensitivities in revenue performance and cost inflation, and assessed the resulting impact on liquidity and covenant compliance. Thus, the directors continue to adopt the going concern basis of accounting in preparing the financial statements. Further details regarding the adoption of the going concern basis of accounting can be found in note 1, in the statement of accounting policies in the financial statements.

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

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

In preparing these financial statements, the directors are required to:

• select suitable accounting policies and then apply them consistently;

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

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

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

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

We have audited the financial statements of Silentnight Group Limited (the 'company') for the year ended 31 January 2026, which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity 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 give a true and fair view of the state of the company's affairs as at 31 January 2026 and of its profit for the year then ended;

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the ‘Auditor’s responsibilities for the audit of the financial statements’ section of our report. We are independent of the 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

We are responsible for concluding on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify the auditor’s opinion. Our conclusions are based on the audit evidence obtained up to the date of our report. However, future events or conditions may cause the company to cease to continue as a going concern.

In our evaluation of the directors’ conclusions, we considered the inherent risks associated with the company's business model including effects arising from macro-economic uncertainties such as the impact of cost inflation and global conflicts on fuel price, we assessed and challenged the reasonableness of estimates made by the directors and the related disclosures and analysed how those risks might affect the company's financial resources or ability to continue operations over the going concern period.

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

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

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

Other information

The other information comprises the information included in the annual report and financial statements, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information contained within the annual report and financial statements. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

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

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

Matter on which we are required to report under the Companies Act 2006

In the light of the 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 or the directors’ report.

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

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

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

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

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

As explained more fully in the directors' responsibilities statement set out on page 7, 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 company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below:

• 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 most significant laws and regulations is the Companies Act 2006.

• We obtained an understanding of how the Company is complying with those legal and regulatory frameworks by making inquiries of management and those responsible for legal and compliance procedures.

• We assessed the susceptibility of the Company’s financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the group engagement team included:

  • Evaluation of the processes and controls established to address the risks related to irregularities and fraud;

  • Making inquiries, in respect of fraud, of those outside the finance team, including key management and the board;

  • Challenging assumptions and judgements made by management in the Company’s significant accounting estimates;

  • Identifying and testing unusual journal entries; and

  • Identifying and testing related party transactions.

• These audit procedures were designed to provide reasonable assurance that the financial statements were free from fraud or error. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error and detecting irregularities that result from fraud is inherently more difficult than detecting those that result from error, as fraud may involve collusion, deliberate concealment, forgery or intentional misrepresentations. Also, the further removed non-compliance with laws and regulations is from events and transactions reflected in the financial statements, the less likely we would become aware of it;

• The engagement partners assessment of the appropriateness of the collective competence and capabilities of the engagement team included consideration of the engagement team’s knowledge of the industry in which the Company operates, and the understanding of, and practical experience with, audit engagements of a similar nature and complexity through appropriate training and participation.

• The engagement team’s discussions in respect of potential non-compliance with laws and regulations and fraud included the risk of fraud in revenue recognition.

A further description of our responsibilities for the audit of the financial statements is located 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.

The profit and loss account has been prepared on the basis that all operations are continuing operations and there are no other items of comprehensive income.

Silentnight Group Limited is a private company, limited by shares and incorporated in England and Wales. The registered office is Long Ing Business Park, Long Ing Lane, Barnoldswick, Lancashire, BB18 6BJ.

The company's principal activities and nature of its operations are disclosed in the Strategic and Directors' report on pages 1 to 4.

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 including the provisions of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008.

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. The principal accounting policies adopted are set out below.

This 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:

• Section 4 ‘Statement of Financial Position’: Reconciliation of the opening and closing number of shares;

• Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

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

The financial statements of the company are consolidated in the financial statements of The Sleep Group Topco Limited. These consolidated financial statements are available from its registered office, Long Ing Business Park, Long Ing Lane, Barnoldswick, United Kingdom, BB18 6BJ.

The group has a third-party loan of £65m taken out in January 2026, which replaced a £43m loan taken out in June 2024. The group also has access to a £10m revolving credit facility, of which it had utilised £1.5m at the balance sheet date. The loan expires in June 2030 and the revolving credit facility expires in December 2028. The financial restructuring carried out in January 2026, was to refinance on improved terms, on the back of the improved financial performance and position of the group, and to also carry out a redemption of the remaining preference shares, returning funds to shareholders and in doing so, replacing high cost existing borrowings with a lower cost instrument. true

The financing reorganisation in January 2026 has further ensured the group has adequate resources to continue to develop and grow the business, especially within the contract sector, and is expected to continue in operational existence for the foreseeable future, and for at least 12 months from the date of the financial statements to July 2027. The Directors have prepared detailed financial forecasts and cash flow projections covering a period of at least 12 months from the date of approval of these financial statements. These forecasts incorporate assumptions regarding future trading performance, working capital requirements and capital expenditure. As part of the going concern assessment, the Directors have also considered reasonably possible downside scenarios including sensitivities in revenue performance and cost inflation, and assessed the resulting impact on liquidity and covenant compliance. Thus, the directors continue to adopt the going concern basis of accounting in preparing the financial statements. Further details regarding the adoption of the going concern basis of accounting can be found in note 1, in the statement of accounting policies in the financial statements.

Turnover is attributable to the principal activity of the Company and represents amounts invoiced to customers of the Company after deduction of rebates, allowances and other value added tax.

Turnover from the sale of goods is recognised when the goods are physically delivered to the customer. Licence income is recognised in the month in which it becomes due.

Research and development expenditure is written off to the income statement as incurred.

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Amortisation is charged to administrative expenses and is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:

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

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

Residual value represents the estimated amount which would currently be obtained from disposal of an asset, after deducting estimated costs of disposal, in the assets were already of the age and in the condition expected at the end of its useful life.

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 credited or charged to profit or loss.

At each reporting period end date, the company 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.

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.

Stocks are valued on a weighted average cost basis and are stated at the lower of cost and net realisable value. The cost of finished goods and work in progress includes direct labour and an attributable proportion of appropriate production overheads based on normal levels of activity. Net realisable value is based on estimated selling price, less further costs expected to be incurred to completion and disposal.

Provision is made for obsolete, slow-moving or defective items where appropriate.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks.

The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.

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.

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 company 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 company 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.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate 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 company’s contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the company 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 company.

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 company’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 when the company has 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.

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

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.

The Company operates a number of defined contribution pension schemes for the benefit of its employees. The amount charged to the income statement in respect of pension costs is the contributions payable in the period. Differences between contributions payable in the period and contributions actually paid are shown either as accruals or prepayments in the balance sheet.

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

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.

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

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 company’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.

There are no estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities.

Turnover, which is stated net of rebates, trade discounts, allowances and value added tax, is attributable to the manufacture and sale of beds and bedroom related products.

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

Their aggregate remuneration comprised:

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2025 - 3).

There are no further key management personnel outside of the directors.

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:

The prior year adjustment includes a credit of approximately £946,000 arising from group relief claims relating to prior periods. These claims were included in the submitted corporation tax computations but had not been recognised in the prior year financial statements. The balance of the adjustment relates to the finalisation and agreement of research and development tax credit claims for prior periods.

A deferred tax asset of £76,000 (2025: £102,000) has been recognised in respect of short-term timing differences that are available for offset against future trading profits of the same trade. There is no expiry date for any of the timing differences.

The net carrying value of tangible fixed assets held under finance leases or hire purchase contracts at the year end was £1,553,693 (2025: £2,076,000).

Details of the company's subsidiaries at 31 January 2026 are as follows:

A reversal of £90,739 for the provision for slow moving and obsolete stock was recognised in cost of sales in the year. (2025: £353,281 provided). There are no inventories pledged as securities for liabilities.

Amounts owed by group undertakings are not interest bearing and repayable on demand.

Amounts due to group undertakings are interest free and are repayable on demand.

During the year, the Company utilised £1,500,000 of its revolving credit facility (the “RCF”), which forms part of the Company’s overall financing arrangements. The facility matures and is repayable in full on the 24 December 2028, and bears interest at a variable rate of SONIA plus 3.5%.

At the reporting date, £1,500,000 remained outstanding under the RCF (2025: £nil). The facility is secured and is subject to customary financial covenants, with which the Company was in compliance at the year end.

Finance leases are secured on the assets to which they relate.

The onerous lease provision is for a warehouse that was leased in 2022 to help fulfil the initial infill stage of a contract, during the year £295k of the provision was utilised. However, now that this stage has been completed the warehouse has been vacant since mid-2024 with no plans of using it in the future.

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

The company operates a number of defined contribution pension schemes. These schemes are funded by contributions from the company and employees and the assets are held in separate, trustee administered funds. The unpaid contributions outstanding at the period end in respect of UK defined contribution schemes, included in creditors, are £165,000 (2025: £162,000).

All shares carry the same voting rights and no right to fixed income.

The group companies are party to an all-assets debenture arrangement dated 24 June 2024, under which each participating company has provided security over its assets in favour of Kroll Trustee Services Limited in respect of its secured obligations pursuant to its financing arrangement, which has been refinanced to £65,000,000 in the current year (2025: £43,000,000).

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

The company has taken advantage of the exemption under section 33.1A of FRS102 to not disclose transactions with other wholly owned members of the group.

During the period management fees of £507,900 (2025: £523,349) payable to HIG Group were incurred. As at 31 January 2026 £126,975 was outstanding (2025: £126,975).

The directors consider the immediate parent company to be Silentnight Holdings Limited. The directors consider the ultimate controlling party to be its ultimate parent undertaking, H.I.G. Europe Capital Partners III Holdings LP, incorporated in Canada. The largest and smallest Group in which the results of the company are consolidated is this set of financial statements for The Sleep Group Topco Limited, see company information page for the registered address.