Mercia Garden Products Limited Company accounts

COMPANY REGISTRATION NUMBER: 00382248

MERCIA GARDEN PRODUCTS LIMITED

FINANCIAL STATEMENTS

FOR THE YEAR ENDED

31 December 2025

MERCIA GARDEN PRODUCTS LIMITED

FINANCIAL STATEMENTS

PERIOD FROM 1 SEPTEMBER 2024 TO 31 DECEMBER 2025

Contents	Page

Officers and professional advisers	1

Strategic report	2

Directors' report	5

Independent auditor's report to the member	7

Statement of comprehensive income	11

Statement of financial position	12

Statement of changes in equity	13

Notes to the financial statements	14

MERCIA GARDEN PRODUCTS LIMITED

OFFICERS AND PROFESSIONAL ADVISERS

The board of directors	J W Owen
	J A Munro

Registered office	Old Great North Road
	Sutton-On-Trent
	Newark
	Nottinghamshire
	England
	NG23 6QN

Auditor	Streets Audit LLP
	Chartered accountants & statutory auditor
	Windsor House
	A1 Business Park at
	Long Bennington
	Notts
	NG23 5JR

MERCIA GARDEN PRODUCTS LIMITED

STRATEGIC REPORT

PERIOD FROM 1 SEPTEMBER 2024 TO 31 DECEMBER 2025

The directors present the strategic report for the year ended 31 December 2025. Principal activities and review of the business The company's ambition is to become the market leading outdoor garden specialist. Its principal activity is the design, manufacture and sale of timber garden buildings, including sheds, log cabins, summerhouses, playhouses and insulated garden rooms, from its manufacturing site. Products are sold through both B2B and B2C channels, including the company's own website. These financial statements cover an extended period of 16 months, from 1 September 2024 to 31 December 2025. The period includes an additional four winter months, traditionally the quietest trading season for garden buildings. As a result, the figures are not directly comparable with the prior 12 month period. The parent company and ultimately the company was sold in March 2025. Turnover of £17.1m reflects trading for the full 16 month period. Turnover has slightly declined which forms part of the overall group strategy around which channel consumers purchase from, overall group sales have increased. A strong indicator that demand for the company's products remain strong. Trading conditions remained challenging. Consumer discretionary spending stayed under pressure, and input costs rose across timber, labour, energy and transport. The company reported an operating loss of £1.1m (2024: £0.8m) and on an underlying basis pre-exceptional a loss of £0.4m (2024 : £0.6m), given this includes 4 extra loss making months management consider this a strong improvement year on year. - the inclusion of four additional winter months, which are seasonally loss-making; - gross margin to 49.9% (2024: 38.8%); - non-recurring costs relating to the change of ownership Stock increased to £5.5m (2024: £4.8m) to support the expanded product range ahead of sprint selling season. Together with the trading result, this reduced period end cash to £1.4m (2024: £2.7m). Key performance indicators

	2025	2024
	£	£
Turnover £m	17	18
Gross Margin %	50	39
Stock £m	6	5
Average Employees	147	154

The 2025 amounts represent an extended 16 month period Outlook The Directors are confident in the company's prospects for the year ending 31 December 2026 and beyond. The period under review was one of transition. Under new ownership, and with a Managing Director appointed in May 2026, the company has established a clear strategic direction focused on sustainable, profitable growth. That direction is already being reflected in trading. By September 2026, turnover for the current year had already exceeded the company's reported turnover for the whole of the prior 16-month period, with growth across all channels. The company is building on strong foundations: an established brand, proven manufacturing capability and a multi-channel route to market. It is broadening its offer through an expanding product range, which increases the opportunity to capture a greater share of customer spend. It also supports progress towards the company's ambition of becoming the market-leading outdoor garden specialist. Management is prioritising the recovery of gross margin and underlying profitability through pricing discipline, procurement, operational efficiency and tighter control of working capital. These actions are already under way. The Directors recognise that consumer confidence and input costs will remain challenging in the near term. However, with a strengthened leadership team, the continued support of its shareholder and a clear plan, the company is well positioned to deliver improved financial performance in the coming year. Going concern The Directors have prepared the company's financial statements on a going concern basis. In making this assessment, the Directors have considered the company's cash flow forecasts and financial position for the period to 31 December 2027, together with the company's five-year forecast and the actions being taken to improve revenue, gross margin and operating costs. The company's forecast assumes continued growth in revenue, supported by the expansion of its B2B activities, development of new customer channels, extension of its product range, improvements in website conversion and digital marketing performance, and the introduction of additional chargeable delivery services. A number of these initiatives are already underway and have generated early evidence of commercial traction. The Directors are also implementing a number of measures to improve gross margins and reduce operating costs. These include supply-chain initiatives, redesign of products, increased use of artificial intelligence in customer service and planning, strengthened logistics management and improved reporting and control over digital marketing expenditure. The Directors have identified material potential savings from these initiatives, although certain benefits remain subject to implementation and further operational evidence. The Directors have considered the company's forecast liquidity and headroom throughout the assessment period, including the sensitivity of the forecasts to changes in trading performance, gross margins and operating costs. The Directors consider that the actions already taken, together with the company's forecast trading performance and the continuous financial support of its ultimate shareholder, James Owen, provide a reasonable basis for concluding that the Group will be able to meet its liabilities as they fall due for the foreseeable future. Accordingly, the Directors consider it appropriate to prepare the company's financial statements on a going concern basis. In making this assessment, the Directors have received a formal commitment from James Owen confirming that he will continue to provide necessary working capital funding for a period of at least 12 months from the date of approval of these financial statements. The Directors recognise that the achievement of the forecast results is dependent on the successful delivery of the operational and commercial initiatives described above and therefore continue to monitor the company's trading performance, cash position and forecast headroom closely. Principal risks and uncertainties Economic conditions- Demand relies on discretionary consumer spending, which is sensitive to economic conditions. Management monitors trading closely and adjusts pricing, marketing and product mix in response. Competition- The market is competitive. The company responds through price monitoring, product development and a focus on quality and customer service. Input costs- The company is exposed to movements in the cost of timber, labour, energy and transport, which it manages through supplier negotiation, pricing reviews and productivity improvements. Financial risk management objectives and policies The company uses financial instruments including loans, cash, trade debtors and trade creditors that arise directly from its operations. The main risks arising are liquidity, credit, currency and interest rate risk. The directors review and agree policies for managing each of these risks. Liquidity risk- The company manages liquidity by ensuring sufficient funds are available to meet foreseeable needs. The company is supported by a working capital facility and by funding from its shareholder. Credit risk- The company is exposed to credit risk on its trade accounts. Credit checks, credit limits and monitoring practices are in place to manage this. Sales through the company's own website are paid in advance and carry no credit risk. Currency risk- Timber and other goods are purchased from overseas, exposing the company to exchange rate movements. The company negotiates in sterling wherever possible. Interest rate risk- The company is exposed to interest rate movements on its borrowing facility. The directors keep the level and cost of borrowing under regular review.

This report was approved by the board of directors on 21 October 2026 and signed on behalf of the board by:

J W Owen

Director

Registered office:

Old Great North Road

Sutton-On-Trent

Newark

Nottinghamshire

England

NG23 6QN

MERCIA GARDEN PRODUCTS LIMITED

DIRECTORS' REPORT

PERIOD FROM 1 SEPTEMBER 2024 TO 31 DECEMBER 2025

The directors present their report and the financial statements of the company for the period ended 31 December 2025 .

Directors

The directors who served the company during the period were as follows:

T R Waldron
J W Owen	(Appointed 14 March 2025)
D Berry	(Resigned 14 March 2025)
I Burgess	(Resigned 14 March 2025)
R P Elliman	(Resigned 14 March 2025)
J C Homewood	(Resigned 14 March 2025)
G J M Rees	(Resigned 14 March 2025)

Dividends

Particulars of recommended dividends are detailed in note 14 to the financial statements.

Directors' responsibilities statement

The directors are responsible for preparing the strategic report, directors' report and the financial statements in accordance with applicable law and regulations. Company law requires the directors to prepare financial statements for each financial period. 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 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 judgments and accounting estimates that are reasonable and prudent; - 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. Auditor

Each of the persons who is a director at the date of approval of this report confirms that:

- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.

This report was approved by the board of directors on 21 October 2026 and signed on behalf of the board by:

J W Owen

Director

Registered office:

Old Great North Road

Sutton-On-Trent

Newark

Nottinghamshire

England

NG23 6QN

MERCIA GARDEN PRODUCTS LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBER OF MERCIA GARDEN PRODUCTS LIMITED

PERIOD FROM 1 SEPTEMBER 2024 TO 31 DECEMBER 2025

Opinion

We have audited the financial statements of Mercia Garden Products Limited (the 'company') for the period ended 31 December 2025 which comprise the statement of comprehensive income, statement of financial position, statement of changes in equity and the related notes, 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 FRS 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 December 2025 and of its loss for the period then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - 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

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, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information. 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. In connection with our audit of the financial statements, 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 or a material misstatement of the other information. 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 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.

Matters on which we are required to report by exception

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.

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was that we identified the material laws and regulations applicable to the group through discussions with management, and from our commercial knowledge and experience of the group and various sectors in which it operates. We then assessed the extent of compliance with these laws and regulations through making enquiries of of management. We assessed the susceptibility of the group's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. To address the risk of fraud through management bias and override of controls we tested journal entries to identify unusual transactions, we assessed whether judgements and assumptions made in determining the accounting estimates set out in Note 3 were indicative of potential bias; and we investigated the rationale behind significant or unusual transactions. In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to agreeing financial statement disclosures to underlying supporting documentation and reviewing correspondence with relevant regulators. There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion. 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 member, 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 member 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 member as a body, for our audit work, for this report, or for the opinions we have formed.

MARK BRADSHAW

(Senior Statutory Auditor)

For and on behalf of

Streets Audit LLP

Chartered accountants & statutory auditor

Windsor House

A1 Business Park at

Long Bennington

Notts

NG23 5JR

21 October 2026

MERCIA GARDEN PRODUCTS LIMITED

STATEMENT OF COMPREHENSIVE INCOME

PERIOD FROM 1 SEPTEMBER 2024 TO 31 DECEMBER 2025

		Period from
		1 Sep 24 to	Year to
		31 Dec 25	31 Aug 24
			(restated)
Note		£	£
Turnover	4	17,134,325	18,288,611

Cost of sales	( 8,573,731)	( 11,190,373)
	-------------	-------------
Gross profit	8,560,594	7,098,238

Distribution costs		( 4,465,892)	( 3,798,009)
Administrative expenses		( 4,524,007)	( 3,887,650)
Other operating income	5	24,015	–
Exceptional costs		( 698,486)	( 182,522)
		------------	------------
Operating loss	6	( 1,103,776)	( 769,943)

Other interest receivable and similar income	11	62,709	108,339
Interest payable and similar expenses	12	( 206,002)	( 6,892)
		------------	------------
Loss before taxation		( 1,247,069)	( 668,496)

Tax on loss	13	313,263	82,024
		------------	---------
Loss for the financial period and total comprehensive income		( 933,806)	( 586,472)
		------------	---------

All the activities of the company are from continuing operations.

MERCIA GARDEN PRODUCTS LIMITED

STATEMENT OF FINANCIAL POSITION

31 December 2025

	31 Dec 25	31 Aug 24
		(restated)
Note	£	£

Fixed assets

Tangible assets	15	3,398,061	3,180,341

Current assets

Stocks	16	5,822,158	4,750,914
Debtors	17	12,567,751	11,402,076
Cash at bank and in hand		1,434,364	2,708,902
		-------------	-------------
		19,824,273	18,861,892

Creditors: amounts falling due within one year	18	( 14,250,954)	( 12,008,385)
		-------------	-------------
Net current assets		5,573,319	6,853,507
		------------	-------------
Total assets less current liabilities		8,971,380	10,033,848

Creditors: amounts falling due after more than one year	19	( 171,338)	–
		------------	-------------
Net assets		8,800,042	10,033,848
		------------	-------------

Capital and reserves

Called up share capital	25	37,500	37,500
Revaluation reserve	26	1,757,199	1,789,603
Profit and loss account	26	7,005,343	8,206,745
		------------	-------------
Shareholder funds		8,800,042	10,033,848
		------------	-------------

These financial statements have been prepared in accordance with the provisions applicable to companies subject to the medium companies regime.

These financial statements were approved by the board of directors and authorised for issue on 21 October 2026 , and are signed on behalf of the board by:

J W Owen

Director

Company registration number: 00382248

MERCIA GARDEN PRODUCTS LIMITED

STATEMENT OF CHANGES IN EQUITY

PERIOD FROM 1 SEPTEMBER 2024 TO 31 DECEMBER 2025

			Called up share capital	Revaluation reserve	Profit and loss account	Total
			£	£	£	£
At 1 September 2023			37,500	1,822,007	9,019,135	10,878,642

Loss for the period					( 586,472)	( 586,472)
Other comprehensive income for the period:
	Reclassification from revaluation reserve to profit and loss account		–	( 32,404)	32,404	–
			--------	------------	------------	-------------
Total comprehensive income for the period			–	( 32,404)	( 554,068)	( 586,472)

Dividends paid and payable		14	–	–	( 300,000)	( 300,000)
Equity-settled share-based payments			–	–	41,678	41,678
			--------	------------	------------	-------------
Total investments by and distributions to owners			–	–	( 258,322)	( 258,322)

At 31 August 2024			37,500	1,789,603	8,206,745	10,033,848

Loss for the period					( 933,806)	( 933,806)
Other comprehensive income for the period:
	Reclassification from revaluation reserve to profit and loss account		–	( 32,404)	32,404	–
			--------	------------	------------	-------------
Total comprehensive income for the period			–	( 32,404)	( 901,402)	( 933,806)

Dividends paid and payable		14	–	–	( 300,000)	( 300,000)
			----	----	---------	---------
Total investments by and distributions to owners			–	–	( 300,000)	( 300,000)

			--------	------------	------------	------------
At 31 December 2025			37,500	1,757,199	7,005,343	8,800,042
			--------	------------	------------	------------

MERCIA GARDEN PRODUCTS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

PERIOD FROM 1 SEPTEMBER 2024 TO 31 DECEMBER 2025

1. General information

The company is a private company limited by shares, registered in England and Wales. The address of the registered office is Old Great North Road, Sutton-On-Trent, Newark, Nottinghamshire, NG23 6QN, England.

2. Statement of compliance

These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.

3. Accounting policies

Basis of preparation

The financial statements have been prepared on the historical cost basis and in sterling, which is the functional currency of the entity. Going concern We draw attention to the Directors assessment of going concern included in the Strategic Report. In line with their assessment, the financial statements have been prepared on a going concern basis. Disclosure exemptions The entity satisfies the criteria of being a qualifying entity as defined in FRS 102. Its financial statements are consolidated into the financial statements of Friars 938 Limited which can be obtained from the registered office. As such, advantage has been taken of the following disclosure exemptions available under paragraph 1.12 of FRS 102: (a) Disclosures in respect of each class of share capital have not been presented. (b) No cash flow statement has been presented for the company. (c) Disclosures in respect of financial instruments have not been presented. (d) Disclosures in respect of share-based payments have not been presented. Judgements and key sources of estimation uncertainty The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The actual outcome may diverge from these estimates if other assumptions are made, or other conditions arise. Key sources of estimation uncertainty Accounting estimates and assumptions are made concerning the future and, by their nature, will rarely equal the related actual outcome. The key assumptions and other sources of estimation uncertainty that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows: (i) Depreciation charges- The annual depreciation charge for tangible assets is sensitive to changes in the useful economic lives and residual values of the assets. These are reviewed periodically by the Directors to ensure that they reflect both external and internal factors. (ii) Provisions for stock and debtors- The company makes an estimate of the recoverable value of trade debtors and stocks. When making their assessment, management considers various factors but they remain an estimate of the actual costs. (iii) Carrying value of land and buildings- Historically land and buildings have been accounted for under the revaluation model, with the most recent valuation performed in May 2015. On transition to FRS 102 management elected to treat this revalued amount as the deemed cost of the asset. (iv) Recoverability of intercompany balances- The carrying value of amounts owed by group undertakings at the balance sheet date was £10,084,759 (2024 - £8,524,985). Balances are assessed for indicators of impairment at each balance sheet date. If there is objective evidence of impairment, a loss is recognised in the profit and loss account. No impairments were recognised in the period. Revenue recognition Turnover is measured at the fair value of the consideration received or receivable for goods provided,stated net of discounts, rebates and of Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have transferred to the buyer, usually on despatch of the goods, the amount of revenue can be measured reliably, it is probable that the associated economic benefits will flow to the entity, and the costs incurred or to be incurred in in respect of the transactions can be measured reliably. Income tax The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date. Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference. Foreign currencies Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account. Operating leases Lease payments are recognised as an expense over the lease term on a straight-line basis. The aggregate benefit of lease incentives is recognised as a reduction to expense over the lease term, on a straight-line basis. Tangible assets Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Freehold land amounting to £485,325 (2024 - £485,325) is not depreciated. Freehold buildings are depreciated on a straight-line basis over their estimated useful economic lives. Where land and buildings are acquired together, their cost or valuation is allocated between the separate components on a reasonable and supportable basis. Depreciation Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:

Freehold property	-	2% straight line
Plant and machinery	-	25% straight line
Motor vehicles	-	25-33% straight line

Impairment of fixed assets A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date.

Stocks

Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition including direct labour costs. Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential. At each reporting date an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in the profit and loss. Reversals of impairment losses are also recognised in the profit and loss.

Finance leases and hire purchase contracts

Assets held under finance leases and hire purchase contracts are recognised in the statement of financial position as assets and liabilities at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset. Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability using the effective interest method. Finance charges are allocated to each period so as to produce a constant rate of interest on the remaining balance of the liability.

Financial instruments

The company only holds basic financial instruments as defined in FRS 102. The financial assets and financial liabilities of the group and their measurement basis are as follows: Financial assets - trade and other debtors are basic financial instruments and are debt instruments measured at amortised cost. Prepayments are not financial instruments. Cash at bank is classified as a basic financial instrument and is measured at amortised cost. Financial liabilities - trade creditors and other creditors are financial instruments, and are measured at amortised cost. Taxation and social security are not included in the financial instruments disclosure definition.

Defined contribution plans

Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund.

4. Turnover

Turnover arises from:

	Period from
	1 Sep 24 to	Year to
	31 Dec 25	31 Aug 24
		(restated)
	£	£
Sale of goods	17,134,325	18,288,611
	-------------	-------------

The whole of the turnover is attributable to the principal activity of the company wholly undertaken in the United Kingdom.

5. Other operating income

	Period from
	1 Sep 24 to	Year to
	31 Dec 25	31 Aug 24
		(restated)
	£	£
Other operating income	24,015	–
	--------	----

6. Operating loss

Operating profit or loss is stated after charging/crediting:

	Period from
	1 Sep 24 to	Year to
	31 Dec 25	31 Aug 24
		(restated)
	£	£
Depreciation of tangible assets	350,100	416,576
Impairment of trade debtors	–	(509)
Foreign exchange differences	( 20,000)	( 8,637)
	---------	---------

7. Exceptional items

Exceptional items comprise significant items of income and expenditure which, because of their size and nature, are disclosed separately to enable a better understanding of the financial performance of the company.

During the year costs of £698,486 were incurred and have been recognised as exceptional items within administrative expenses.

These costs principally relate to:

- Redundancy and employee termination costs;

- Lease dilapidation provisions;

- Website and rebranding costs;

- Professional and advisory fees associated with the disposal;

- Contract cancellation costs; and

- Other directly attributable restructuring costs.

The directors consider these costs to be exceptional due to their non-recurring nature and significance to the financial statements.

8. Auditor's remuneration

	Period from
	1 Sep 24 to	Year to
	31 Dec 25	31 Aug 24
		(restated)
	£	£
Fees payable for the audit of the financial statements	32,000	32,000
	--------	--------

9. Staff costs

The average number of persons employed by the company during the period, including the directors, amounted to:

	31 Dec 25	31 Aug 24
	No.	No.
Production staff	68	69
Distribution staff	55	63
Administrative staff	24	22
	----	----
	147	154
	----	----

The aggregate payroll costs incurred during the period, relating to the above, were:

	Period from
	1 Sep 24 to	Year to
	31 Dec 25	31 Aug 24
		(restated)
	£	£
Wages and salaries	6,642,857	5,009,403
Social security costs	699,738	450,331
Other pension costs	159,149	120,244
	------------	------------
	7,501,744	5,579,978
	------------	------------

10. Directors' remuneration

The directors' aggregate remuneration in respect of qualifying services was:

	Period from
	1 Sep 24 to	Year to
	31 Dec 25	31 Aug 24
		(restated)
	£	£
Remuneration	324,836	346,633
Company contributions to defined contribution pension plans	21,144	20,890
	---------	---------
	345,980	367,523
	---------	---------

The number of directors who accrued benefits under company pension plans was as follows:

	31 Dec 25	31 Aug 24
		(restated)
	No.	No.
Defined contribution plans	5	4
	----	----

Remuneration of the highest paid director in respect of qualifying services:

	Period from
	1 Sep 24 to	Year to
	31 Dec 25	31 Aug 24
		(restated)
	£	£
Aggregate remuneration	182,336	123,883
Company contributions to defined contribution pension plans	15,400	11,550
	---------	---------
	197,736	135,433
	---------	---------

11. Other interest receivable and similar income

	Period from
	1 Sep 24 to	Year to
	31 Dec 25	31 Aug 24
		(restated)
	£	£
Interest on cash and cash equivalents	62,709	108,339
	--------	---------

12. Interest payable and similar expenses

	Period from
	1 Sep 24 to	Year to
	31 Dec 25	31 Aug 24
		(restated)
	£	£
Interest on banks loans and overdrafts	201,248	6,892
Interest on obligations under finance leases and hire purchase contracts	4,754	–
	---------	-------
	206,002	6,892
	---------	-------

13. Tax on loss

Major components of tax income

	Period from
	1 Sep 24 to	Year to
	31 Dec 25	31 Aug 24
		(restated)
	£	£

Current tax:

UK current tax income	–	( 82,024)
Adjustments in respect of prior periods	( 23,177)	–
	--------	--------
Total current tax	( 23,177)	( 82,024)
	--------	--------

Deferred tax:

Origination and reversal of timing differences	( 290,086)	–
	---------	--------
Tax on loss	( 313,263)	( 82,024)
	---------	--------

Reconciliation of tax income

The tax assessed on the loss on ordinary activities for the period is lower than (2024: higher than) the standard rate of corporation tax in the UK of 25 % (2024: 25 %).

	Period from
	1 Sep 24 to	Year to
	31 Dec 25	31 Aug 24
		(restated)
	£	£
Loss on ordinary activities before taxation	( 1,247,069)	( 668,496)
	------------	---------
Loss on ordinary activities by rate of tax	( 311,767)	( 156,350)
Adjustment to tax charge in respect of prior periods	( 23,177)	69,634
Effect of expenses not deductible for tax purposes	32,144	4,692
Effect of capital allowances and depreciation	( 3,915)	–
Effect of unprovided deferred tax	(6,548)	–
	------------	---------
Tax on loss	( 313,263)	( 82,024)
	------------	---------

14. Dividends

	31 Dec 25	31 Aug 24
		(restated)
	£	£
Dividends paid during the period (excluding those for which a liability existed at the end of the prior period )	300,000	300,000
	---------	---------

15. Tangible assets

	Freehold property	Plant and machinery	Motor vehicles	Total
	£	£	£	£
Cost
At 1 September 2024 (as restated)	3,466,396	7,170,850	64,655	10,701,901
Additions	–	537,861	29,959	567,820
	------------	------------	--------	-------------
At 31 December 2025	3,466,396	7,708,711	94,614	11,269,721
	------------	------------	--------	-------------
Depreciation
At 1 September 2024	572,708	6,900,461	48,391	7,521,560
Charge for the period	59,622	282,049	8,429	350,100
	------------	------------	--------	-------------
At 31 December 2025	632,330	7,182,510	56,820	7,871,660
	------------	------------	--------	-------------
Carrying amount
At 31 December 2025	2,834,066	526,201	37,794	3,398,061
	------------	------------	--------	-------------
At 31 August 2024	2,893,688	270,389	16,264	3,180,341
	------------	------------	--------	-------------

The company adopted to transitional provisions under FRS 102 to treat the revalued amounts of freehold property as deemed cost. The land and buildings were professionally valued to £3,735,500 in May 2015 when the historical cost was £1,604,725. The depreciation on freehold property was subject to a prior year adjustment. Refer to note 24 for further details.

16. Stocks

	31 Dec 25	31 Aug 24
		(restated)
	£	£
Raw materials and consumables	2,086,645	2,391,606
Work in progress	549,429	627,409
Finished goods and goods for resale	3,186,084	1,731,899
	------------	------------
	5,822,158	4,750,914
	------------	------------

Stocks are stated after impairment provisions of £299,339 (2024 - £94,048).

17. Debtors

	31 Dec 25	31 Aug 24
		(restated)
	£	£
Trade debtors	1,753,886	2,308,784
Amounts owed by group undertakings	10,084,759	8,524,985
Deferred tax asset	340,220	50,134
Prepayments and accrued income	388,886	304,815
Corporation tax repayable	–	217,835
Other debtors	–	( 4,477)
	-------------	-------------
	12,567,751	11,402,076
	-------------	-------------

Amounts owed by group undertakings are unsecured, interest free and repayable on demand.

18. Creditors: amounts falling due within one year

	31 Dec 25	31 Aug 24
		(restated)
	£	£
Trade creditors	1,734,065	1,701,101
Amounts owed to group undertakings	6,503,932	8,298,942
Accruals and deferred income	687,575	1,117,429
Social security and other taxes	1,032,102	452,806
Obligations under finance leases and hire purchase contracts	49,687	8,331
Other creditors	4,243,593	429,776
	-------------	-------------
	14,250,954	12,008,385
	-------------	-------------

Amounts owed to group undertakings are unsecured, interest free and repayable on demand. Other creditors includes hire purchase liabilities of £49,687 (2024 - £8,331)and loans owing to Cynergy Business Finance Limited of £2,800,000. The hire purchase liabilities are secured on the specific financed assets. The Cynergy Business Finance Limited financing facilities are secured by fixed and floating charges over substantially all of its assets and undertaking in favour of Cynergy Business Finance Limited. The assets subject to security include freehold land and buildings, plant and machinery, trade receivables, bank accounts and other business assets. The company has also granted security in favour of Barclays Bank PLC over designated bank accounts and deposits.

19. Creditors: amounts falling due after more than one year

	31 Dec 25	31 Aug 24
		(restated)
	£	£
Obligations under finance leases and hire purchase contracts	171,338	–
	---------	----

The hire purchase liabilities are secured on the specific financed assets.

20. Finance leases and hire purchase contracts

The total future minimum lease payments under finance leases and hire purchase contracts are as follows:

	31 Dec 25	31 Aug 24
		(restated)
	£	£
Not later than 1 year	49,687	8,331
Later than 1 year and not later than 5 years	171,338	–
	---------	-------
	221,025	8,331
	---------	-------

21. Deferred tax

The deferred tax included in the statement of financial position is as follows:

	31 Dec 25	31 Aug 24
		(restated)
	£	£
Included in debtors (note 17)	340,220	50,134
	---------	--------

The deferred tax account consists of the tax effect of timing differences in respect of:

	31 Dec 25	31 Aug 24
		(restated)
	£	£
Accelerated capital allowances	( 154,158)	( 92,277)
Unused tax losses	470,285	137,548
Pension plan obligations	24,093	4,863
	---------	---------
	340,220	50,134
	---------	---------

The deferred tax asset on losses is expected to unravel in the next few years as the losses are utilised against profits however the amount to reverse in the next accounting period cannot be quantified due to unknown variables such as profitability, research and development reliefs and capital expenditure .

22. Employee benefits

Defined contribution plans

The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 138,005 (2024: £ 115,173 ).

23. Financial instruments

The company only holds basic financial instruments as defined in FRS 102. The financial assets and financial liabilities of the group and their measurement basis are as follows: Financial assets - trade and other debtors are basic financial instruments and are debt instruments measured at amortised cost. Prepayments are not financial instruments. Cash at bank is classified as a basic financial instrument and is measured at amortised cost. Financial liabilities - trade creditors and other creditors are financial instruments, and are measured at amortised cost. Taxation and social security are not included in the financial instruments disclosure definition.

24. Prior period errors

During the year, the company identified an error in the accounting for its freehold property. Historically, an excessive proportion of the property's value had been allocated to land, with the result that insufficient depreciation had been charged on the buildings element of the property. The error arose because the allocation between land and buildings used in calculating depreciation did not appropriately reflect the separate values attributable to those components. Land and buildings have different useful economic lives and are therefore accounted for separately, with land not depreciated and buildings depreciated over their estimated useful economic lives. The allocation has been reassessed using a land-to-buildings ratio of 15:85, based on available valuation evidence. This has resulted in additional depreciation being recognised retrospectively from 2015, when the property was last revalued. The error has been corrected retrospectively by restating the comparative amounts for the year ended 31 August 2024 and adjusting the opening balances of tangible fixed assets, the revaluation reserve and retained earnings at the beginning of the comparative period. The effect of the correction on the previously reported financial statements is set out below:- - Increase in depreciation expense for the year of £43,098 - Increase in accumulated depreciation of £423,343 - Reduction to the revaluation reserve of £315,943 - Net reduction to the profit and loss reserve of £107,400. The directors also identified that certain items included within cost of sales and distribution costs in the prior year financial statements should have been classified as administrative expenses. The adjustment affects only the classification of expenses within the statement of comprehensive income and has no impact on profit before taxation, profit after taxation, net assets or reserves. The effect of the restatement was to decrease cost of sales by £511,976, decrease distribution costs by £394,476 and increase administrative expenses by £906,452. There was no tax effect from all the adjustments and the comparative figures in these financial statements have been restated accordingly.

25. Called up share capital

Issued, called up and fully paid

	31 Dec 25		31 Aug 24
			(restated)
	No.	£	No.	£
Ordinary shares of £ 1 each	37,500	37,500	37,500	37,500
	--------	--------	--------	--------

26. Reserves

Revaluation reserve - This reserve records the value of asset revaluations and fair value movements on assets recognised in other comprehensive income. Profit and loss account - This reserve records retained earnings and accumulated losses.

27. Operating leases

The total future minimum lease payments under non-cancellable operating leases are as follows:

	31 Dec 25	31 Aug 24
		(restated)
	£	£
Not later than 1 year	516,418	463,939
Later than 1 year and not later than 5 years	412,394	1,048,302
	---------	------------
	928,812	1,512,241
	---------	------------

28. Controlling party

The immediate parent company is Rosimian Limited and the ultimate parent company was The Garden Buildings Group Limited until 14 March 2025 when it was acquired in full by Friars 938 Limited. Friars 938 Limited remains the ultimate parent undertaking, and the smallest and largest group to consolidate these financial statements. Copies of the Friars 938 Limited consolidated financial statements can be obtained from the Company Secretary at the Registered Office. The ultimate controlling party is J Owen, a Director of this company.