REGISTERED NUMBER: 09319409 (England and Wales)

GROUP STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

AUDITED

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST JANUARY 2026

FOR

NOWELL LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

5

Consolidated Statement of Comprehensive Income

9

Consolidated Balance Sheet

10

Company Balance Sheet

11

Consolidated Statement of Changes in Equity

12

Company Statement of Changes in Equity

13

Consolidated Cash Flow Statement

14

Notes to the Consolidated Cash Flow Statement

15

Notes to the Consolidated Financial Statements

16

DIRECTORS:

Mr U M Patel

Mr N U Patel

REGISTERED OFFICE:

Riverside Service Station

431 Kirkstall Road

Leeds

LS4 2QD

REGISTERED NUMBER:

09319409 (England and Wales)

AUDITORS:

Aspen Waite

Chartered Certified Accountants

and Statutory Auditors

Rubis House

15 Friarn Street

Bridgwater

Somerset

TA6 3LH

The directors present their strategic report of the company and the group for the year ended 31st January 2026.

Nowell Limited is a holding company and its principle activity is that of an independent operator of petrol station forecourt sites, mainly in Yorkshire but also in Liverpool. It also has investments in companies in the fast-food sector as franchisees.

REVIEW OF BUSINESS

The directors consider that the result for the year and the position to be satisfactory.

Fuel, and shop, sales, and margins remained strong,

PRINCIPAL RISKS AND UNCERTAINTIES

The directors do not consider that the company company faces any specific risk other than being exposed to the general risks being faced by the sector in which the company operates, such as competition and price volatility. The directors manage such risks by being involved on a hands-on and day to day basis and maintaining strong relationships with suppliers and employees at all the various sites that the company operates from.

The directors believe that the company continues to have adequate resources and the diversification into other areas will help the business navigate any future uncertainties.

KEY PERFORMANCE INDICATORS

The main financial metrics used by the directors in assessing business performance are turnover, net profit and cash flows. These KPI's are monitored regularly to ensure the group continues to progress and generate healthy profits and cash flow.

31/01/2026

31/01/2025

Change

Change %

Sales - Fuel

26,434,633

26,145,892

288,741

1.1%

Sales - Shop

6.270,594

6,655,490

(384,896)

(5.8%)

Rental Income

38,424

40,551

(2,127)

(5.2%)

Total

32,743,651

32,841,933

(98,282)

(0.3%)

Gross Profit

3,134,700

3,060,972

73,728

2.4%

Margin

9.6%

9.3%

0.3%

Other income

166,582

191,523

(24,941)

(13.0%)

Income from associates

8,767

633

8,134

1,285.0%

Overheads

(1,397,738

)

(1,585,983

)

188,245

(11.9%)

Net Profit

1,912,311

1,667,145

245,166

14.7%

Margin

5.8%

5.1%

0.8%

ON BEHALF OF THE BOARD:

Mr N U Patel - Director

23rd October 2026

The directors present their report with the financial statements of the company and the group for the year ended 31st January 2026.

PRINCIPAL ACTIVITY

The principal activity of the group in the year under review was that of a holding company.

DIVIDENDS

The total distribution of dividends for the year ended 31st January 2026 will be £76,000 (£100,000 - 2025).

DIRECTORS

The directors shown below have held office during the whole of the period from 1st February 2025 to the date of this report.

Mr U M Patel

Mr N U Patel

LIQUIDITY AND INTEREST RATE RISK

The group manages its cash to minimize its need to borrow, the directors and owners are Muslim and therefore operate their business on Islamic principles, as such the company has no financial borrowings.

CREDIT RISK

Investments of cash surpluses are made through banks and companies which must fulfil credit rating criteria approved by the Board.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Group Strategic Report, the Report of the Directors 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), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 group and of the profit or loss of the group 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;

-	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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

AUDITORS

The auditors, Aspen Waite, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr N U Patel - Director

23rd October 2026

Opinion

We have audited the financial statements of Nowell Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31st January 2026 which comprise the Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, 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 group's and of the parent company affairs as at 31st January 2026 and of the group's profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the group 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 group's and the parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

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

Other information

The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

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 this gives rise to 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 Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Group Strategic Report and the Report of the Directors 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 group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Directors.

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

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

-	the parent company 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 Statement of Directors' Responsibilities set out on page three, 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 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 group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.

Auditors' 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 a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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

Irregularities, including fraud are instances of non-compliance with laws and regulations. We designed 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 irregularity including fraud is detailed below.

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our: general commercial and sector experience; through verbal and written communications with those charged with governance and other management; and via inspection of the company's regulatory and legal correspondence.

We discussed with those charged with governance and other management the policies and procedures regarding compliance with laws and regulations.

We communicated identified laws and regulations to our team and remained alert to any indicators of non-compliance throughout the audit, we also specifically considered where and how fraud may occur within the company.

The potential effect of these laws and regulations on the financial statements varies considerably.

Firstly, the group is subject to laws and regulations that directly affect the financial statements, including: the company's constitution, relevant financial reporting standards; company law; tax legislation and distributable profits legislation and we assess the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.

Secondly the group is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on the amounts or disclosures in the financial statements, for instance through the imposition of fines and penalties, or through losses arising from litigations. We identified the following areas as those most likely to have such an affect:Petroleum Enforcement Authorities (PEAs) ; Consumer Rights Act 2015; employment legislation; health and safety legislation; legislation relevant to the commercial property rental environment; GDPR; anti-bribery and corruption legislation.

International Auditing Standards (UK) limit the required procedures to identify non-compliance with these laws and regulations to the procedures, and no procedures over and above those already noted are required. These limited procedures did not identify any actual or suspected non-compliance which laws and regulations that could have a material impact on the financial statements.

In relation to fraud, we performed the following specific procedures in addition to those already noted:

- Challenging assumptions made by management in its significant accounting estimates in particular: depreciation, provisions for bad debts and provisions for slow moving stocks.;

- Identifying and testing journal entries, in particular any entries posted with unusual nominal ledger account combinations, journal entries crediting cash or any revenue account, and journal entries posted by senior management.

- Performing analytical procedures to identify unexpected movements in account balances which may be indicative of fraud;

- Ensuring that testing undertaken on both the performance statements, and the Balance Sheet includes a number of items selected on a random basis;

These procedures did not identify any actual or suspected fraudulent irregularity that could have a material impact on the financial statements.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with International Auditing Standards UK). For example, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the procedures that we are required to undertake would identify it. In addition, as with any audit, there remains a high risk of non-detection of irregularities, as these might involve collusion, forgery, intentional omissions, misrepresentation, or the override of internal controls. We are not responsible for preventing non-compliance with laws and regulations or fraud, and cannot be expected to detect non-compliance with all laws and regulations or every incidence of fraud.

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 Report of the Auditors.

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 a Report of the Auditors 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.

Paul David Waite (Senior Statutory Auditor)

for and on behalf of Aspen Waite

Chartered Certified Accountants

and Statutory Auditors

Rubis House

15 Friarn Street

Bridgwater

Somerset

TA6 3LH

23rd October 2026

TURNOVER

32,743,651

32,841,933

Cost of sales

(29,608,951

)

(29,780,961

)

GROSS PROFIT

3,134,700

3,060,972

Administrative expenses

(1,397,736

)

(1,585,983

)

1,736,964

1,474,989

Other operating income

153,011

149,247

OPERATING PROFIT

4

1,889,975

1,624,236

Income from interest in associated undertakings

8,767

633

Interest receivable and similar income

13,571

42,276

1,912,313

1,667,145

Interest payable and similar expenses

5

(2

)

-

PROFIT BEFORE TAXATION

1,912,311

1,667,145

Tax on profit

6

(500,037

)

(435,858

)

PROFIT FOR THE FINANCIAL YEAR

1,412,274

1,231,287

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,412,274

1,231,287

Profit attributable to:

Owners of the parent

1,403,507

1,230,654

Non-controlling interests

8,767

633

1,412,274

1,231,287

Total comprehensive income attributable to:

Owners of the parent

1,412,274

1,231,287

FIXED ASSETS

Intangible assets

9

-

23,681

Tangible assets

10

3,830,498

3,568,639

Investments

11

Interest in associate

22,015

22,015

3,852,513

3,614,335

CURRENT ASSETS

Stocks

12

825,417

712,715

Debtors

13

11,250,059

8,933,944

Cash at bank and in hand

1,078,770

2,304,363

13,154,246

11,951,022

CREDITORS

Amounts falling due within one year

14

(4,172,809

)

(4,058,528

)

NET CURRENT ASSETS

8,981,437

7,892,494

TOTAL ASSETS LESS CURRENT LIABILITIES

12,833,950

11,506,829

PROVISIONS FOR LIABILITIES

15

(78,131

)

(78,517

)

NET ASSETS

12,755,819

11,428,312

CAPITAL AND RESERVES

Called up share capital

16

3,050,103

3,050,103

Retained earnings

17

9,705,716

8,378,209

SHAREHOLDERS' FUNDS

12,755,819

11,428,312

The financial statements were approved and authorised for issue by the Board of Directors and authorised for issue on 23rd October 2026 and were signed on its behalf by:

Mr N U Patel - Director

FIXED ASSETS

Intangible assets

9

-

-

Tangible assets

10

-

-

Investments

11

22,215

22,215

22,215

22,215

CURRENT ASSETS

Debtors

13

7,976,168

7,475,838

Cash at bank and in hand

75,237

77,589

8,051,405

7,553,427

CREDITORS

Amounts falling due within one year

14

(1,055,462

)

(979,462

)

NET CURRENT ASSETS

6,995,943

6,573,965

TOTAL ASSETS LESS CURRENT LIABILITIES

7,018,158

6,596,180

CAPITAL AND RESERVES

Called up share capital

16

3,050,103

3,050,103

Retained earnings

3,968,055

3,546,077

SHAREHOLDERS' FUNDS

7,018,158

6,596,180

Company's profit for the financial year

497,978

498,349

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

The financial statements were approved and authorised for issue by the Board of Directors and authorised for issue on 23rd October 2026 and were signed on its behalf by:

Mr N U Patel - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 31st January 2024

3,050,103

7,247,555

10,297,658

Changes in equity

Dividends

-

(100,000

)

(100,000

)

Total comprehensive income

-

1,230,654

1,230,654

Balance at 31st January 2025

3,050,103

8,378,209

11,428,312

Changes in equity

Dividends

-

(76,000

)

(76,000

)

Total comprehensive income

-

1,403,507

1,403,507

Balance at 31st January 2026

3,050,103

9,705,716

12,755,819

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 31st January 2024

3,050,103

3,147,728

6,197,831

Changes in equity

Dividends

-

(100,000

)

(100,000

)

Total comprehensive income

-

498,349

498,349

Balance at 31st January 2025

3,050,103

3,546,077

6,596,180

Changes in equity

Dividends

-

(76,000

)

(76,000

)

Total comprehensive income

-

497,978

497,978

Balance at 31st January 2026

3,050,103

3,968,055

7,018,158

Cash flows from operating activities

Cash generated from operations

1

(265,056

)

(1,524,101

)

Interest paid

(2

)

-

Tax paid

(439,523

)

(570,004

)

Net cash from operating activities

(704,581

)

(2,094,105

)

Cash flows from investing activities

Purchase of tangible fixed assets

(495,637

)

(225,437

)

Interest received

13,571

42,276

Net cash from investing activities

(482,066

)

(183,161

)

Cash flows from financing activities

Amount introduced by directors

37,054

-

Amount withdrawn by directors

-

(99,026

)

Equity dividends paid

(76,000

)

(100,000

)

Net cash from financing activities

(38,946

)

(199,026

)

Decrease in cash and cash equivalents

(1,225,593

)

(2,476,292

)

Cash and cash equivalents at beginning of year

2

2,304,363

4,780,655

Cash and cash equivalents at end of year

2

1,078,770

2,304,363

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

Period

31/1/24

Year Ended

to

31/1/26

31/1/25

£

£

Profit before taxation

1,912,311

1,667,145

Depreciation charges

214,771

262,851

Loss on disposal of fixed assets

42,688

-

Finance costs

2

-

Finance income

(22,338

)

(42,909

)

2,147,434

1,887,087

(Increase)/decrease in stocks

(112,702

)

104,283

Increase in trade and other debtors

(2,316,115

)

(3,844,441

)

Increase in trade and other creditors

16,327

328,970

Cash generated from operations

(265,056

)

(1,524,101

)

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31st January 2026

31/1/26

1/2/25

£

£

Cash and cash equivalents

1,078,770

2,304,363

Period ended 31st January 2025

31/1/25

31/1/24

£

£

Cash and cash equivalents

2,304,363

4,780,655

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1/2/25

Cash flow

At 31/1/26

£

£

£

Net cash

Cash at bank and in hand

2,304,363

(1,225,593

)

1,078,770

2,304,363

(1,225,593

)

1,078,770

Total

2,304,363

(1,225,593

)

1,078,770

1.	STATUTORY INFORMATION

Nowell Limited is a private company limited by shares, registered in England and Wales. The company's registered number is 09319409, the registered office and principal place of business is,

Riverside Service Station, 431 Kirkstall Road, Leeds, LS4 2QD.

The presentation currency of the financial statements is the Pound Sterling (£).

2.	ACCOUNTING POLICIES

BASIS OF PREPARING THE FINANCIAL STATEMENTS

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

BASIS OF CONSOLIDATION

The consolidated financial statements incorporate those of Nowell Limited and all of its subsidiaries (i.e. entities that the Group controls through its power to govern the financial and operating policies so as to obtain economic benefits).

All financial statements are made up to 31st January 2026. Where necessary, adjustments are made to the financial statements of subsidiaries to bring accounting policies used into line with those by other members of the group.

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group's financial statements from the date that control commences until the date that control ceases.

ASSOCIATES

Associates are carried in the group balance sheet at cost plus post acquisition changes in the group's share of the net assets of the entity, less any impairments in value. The carrying values of investments in associates include acquired goodwill.

RELATED PARTY EXEMPTION

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements.

SIGNIFICANT JUDGEMENTS AND ESTIMATES

The directors do not consider there to be any areas of significant estimation or judgement in the financial statements.

TURNOVER

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

GOODWILL

Goodwill is in connection to acquiring various businesses and is amortised over 10 years.

INTANGIBLE ASSETS

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

TANGIBLE FIXED ASSETS

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Freehold property

-

2% straight line basis

Plant and machinery

-

25% on reducing balance

Fixtures and fittings

-

25% on reducing balance

STOCKS

Stocks are valued at the lower of cost and selling price less costs to complete and sell, on a first in first out basis.

Any damaged or obsolete stock are immediately written off.

TAXATION

Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

DEFERRED TAX

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

HIRE PURCHASE AND LEASING COMMITMENTS

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

PENSION COSTS AND OTHER POST-RETIREMENT BENEFITS

The group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate.

FINANCIAL INSTRUMENTS

The group has elected to apply the provisions of Section 11 "Basic Financial Instruments" of FRS 102 to all of its financial instruments.

Financial instruments are recognised when the group becomes party of the contractual provisions of the instrument, Financial assets and liabilities are offset, with the net amounts presented int he financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

BASIC FINANCIAL ASSETS

Basic financial assets, which include trade and other debtors and cash and bank balances, are initially measured at transaction price including transactions costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financial transaction, where the financial asset is measured at the present value of the future receipts discounted at a market rate of interest.

IMPAIRMENT OF FINANCIAL ASSETS

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.

DERECOGNITION OF FINANCIAL ASSETS

Financial assets are derecognised only when the contractual rights to the cash flows from asset expire or are settled, or when the group transfers the financial asset 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 been transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

CLASSIFICATION OF FINANCIAL LIABILITIES

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments is any contract that evidences a residual interest int he assets of the company after deducting all of its liabilities.

BASIC FINANCIAL LIABILITIES

Basic financial liabilities, including trade and other creditors, bank loans and loans from fellow group companies, are initially recognised at transactions price unless the arrangement constitutes a financial transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

DERECOGNITION OF FINANCIAL LIABILITIES

Financial liabilities are derecognised when, and only when, the group's contractual obligations are discharged, cancelled, or they expire.

EQUITY INSTRUMENTS

Equity instruments issued by the company are recorded at the fair value of proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.