REGISTERED NUMBER: 14183375 (England and Wales)

E G LEWIS GROUP INDUSTRIAL SERVICES LTD

GROUP STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED

31 JANUARY 2026

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

5

Consolidated Income Statement

9

Consolidated Other Comprehensive Income

10

Consolidated Balance Sheet

11

Company Balance Sheet

12

Consolidated Statement of Changes in Equity

13

Company Statement of Changes in Equity

14

Consolidated Cash Flow Statement

15

Notes to the Consolidated Cash Flow Statement

16

Notes to the Consolidated Financial Statements

17

DIRECTORS:

T F Lewis

Mrs S W Lewis

Mrs C Scoberg

G Summerhayes

R Perry

REGISTERED OFFICE:

Tank Farm Road

Llandarcy

Neath

SA10 6EN

REGISTERED NUMBER:

14183375 (England and Wales)

AUDITORS:

Bevan Buckland Audit Ltd (Statutory Auditors)

Ground Floor Cardigan House

Castle Court

Swansea Enterprise Park

Swansea

SA7 9LA

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

Our aims and values

The EG Lewis Group Industrial Services Limited aspire to be the leading multi-disciplined contractor in South Wales, delivering a premium service and effective solutions to our customers.

We value our people, customers, partners and the communities in which we operate. Our core values and behaviours underpin everything we do;

Safety

We are in a hazardous business and everything we do relies upon the safety of our workforce and the communities around us. Safe working is good business and takes priority above all.

Leadership

Our leaders have created a vision and will passionately own and drive it to completion. Our people share our vision and work in line with our actions, beliefs, values, and goals.

Responsibility

We care about the safe management of the environment. We are committed to supporting the communities which we operate. Our people operate in an ethical manner at all times.

Excellence

We strive for excellence through systematic and disciplined management of our operations and commit to quality outcomes, having a thirst to learn, and to improve.

Discipline

We follow and uphold the rules and standards we set for our company. If something is not right, we correct it.

Collaboration

We work to a defined and common business purpose as we accomplish more together, trusting our teams and partners to deliver on our obligations and put the team ahead of personal success.

REVIEW OF BUSINESS

Turnover for the year was £16.6 million (2025: £19.4 million), a decrease of 14%. This was in line with the directors’ forecasts and reflects reduced activity with a key customer as it continued to restructure its operations.

Despite the lower turnover, the gross profit margin improved, with gross profit increasing to £1.79 million (2025: £1.61 million).

The group’s results continue to be affected by the amortisation of goodwill arising on the acquisition of the trading subsidiaries. Goodwill amortisation of £1.03 million (2025: £1.03 million) is a non-cash charge and is not deductible for tax purposes. Before this charge, the group generated an operating profit of £1.48 million (2025: £1.07 million). After goodwill amortisation, operating profit was £449,202 (2025: £40,334).

At 31 January 2026 the group had net liabilities of £1.13 million (2025: £1.61 million). This position arises from cumulative goodwill amortisation, which totals £5.67 million, rather than from losses in the trading businesses. The individual trading subsidiaries continue to report net assets.

Key performance indicators

The directors monitor the performance of the group using the following financial KPIs:

2026

2025

Turnover

£16.6m

£19.4m

Gross Profit Margin

10.8%

8.3%

Operating Profit Before Goodwill Amortisation

£1.48m

£1.07m

Cash At Bank

£0.81m

£2.49m

PRINCIPAL RISKS AND UNCERTAINTIES

The directors consider the principal risks and uncertainties facing the group to be:

Customer concentration.

A significant proportion of the group’s turnover is derived from a small number of key customers. A change in their operations or spending, as seen during the year, has a direct impact on group activity. The directors manage this risk through long-standing customer relationships and by seeking to broaden the customer base and service offering.

Contract risk.

The group’s profitability depends on accurately pricing and managing contracts, including estimates of costs to complete. The risk is managed through contract review procedures, regular monitoring of contract performance and prompt recognition of any expected losses.

Health and safety.

The group operates in a hazardous industry. A serious incident could cause harm to employees and others, and could lead to financial and reputational damage. Safety is the group’s first priority and is managed through established policies, training and close supervision on site.

People.

The group relies on the availability of skilled and experienced personnel. The directors manage this risk through investment in training, development and retention of the workforce.

Liquidity and credit risk.

The group manages its working capital closely. Cash flow forecasts are prepared and monitored regularly, and the creditworthiness of customers is assessed and trade debtors monitored to minimise the risk of bad debts.

Economic conditions.

Demand for the group’s services depends on investment and maintenance activity in the industrial sectors it serves. The directors monitor market conditions and adapt the group’s cost base and service offering accordingly.

FUTURE DEVELOPMENTS

The group remains focused on expanding its service portfolio and developing existing markets where the directors see significant growth potential. By continuing to invest in people, innovation and technology, the group is well positioned to meet evolving client demands and deliver sustainable growth. The directors expect continued infrastructure and industrial investment to provide favourable market conditions for the group’s services over the next few years. As goodwill becomes fully amortised and the trading subsidiaries continue to generate profits, the directors expect the group’s consolidated reserves to return to a positive position

ON BEHALF OF THE BOARD:

T F Lewis - Director

28 October 2026

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

DIVIDENDS

No dividends will be distributed for the year ended 31 January 2026.

EVENTS SINCE THE END OF THE YEAR

Information relating to events since the end of the year is given in the notes to the financial statements.

DIRECTORS

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

T F Lewis

Mrs S W Lewis

Mrs C Scoberg

G Summerhayes

R Perry

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). 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 or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

AUDITORS

The auditors, Bevan Buckland Audit Ltd (Statutory Auditors), will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

T F Lewis - Director

28 October 2026

Opinion

We have audited the financial statements of E G Lewis Group Industrial Services Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 January 2026 which comprise the Consolidated Income Statement, Consolidated Other 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 31 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 four, 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:

Extent to which the audit was considered capable of detecting irregularities, including fraud

We identify and assess the risks of material misstatement of the Financial Statements, whether due to fraud or error, and then, design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

We discussed our audit independence complying with the Revised Ethical Standard 2024 with the engagement team members whilst planning the audit and continually monitored our independence throughout the process.

Identifying and assessing potential risks related to irregularities.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:

-

enquiring of management, including obtaining and reviewing supporting documentation, concerning the group's policies and procedures relating to:

-

identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;

-

detecting and responding to the risks of fraud and whether they have knowledge of any actual. suspected or alleged fraud;

-

the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations;

-

discussing among the engagement team how and where fraud might occur in the group and parent company financial statements and any potential indicators of fraud. As part of this discussion, we identified potential for fraud in the following areas;

-

Assumptions used for valuing work in progress at the year end, and;

-

Potential for deferring income already earned at the year end.

-

obtaining an understanding of the legal and regulatory frameworks that the group operates in, focusing on those laws and regulations that had a direct effect on the Financial Statements or that had a fundamental effect on the operations of the group, The key laws and regulations we considered in this context included the UK Companies Act and relevant tax legislation.

Audit response to risks identified

In addition to the above, our procedures to respond to risks identified included the following:

-

reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with relevant laws and regulations;

-

enquiring of management concerning actual and potential litigation and claims; performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;

-

reading minutes of meetings of those charged with governance and reviewing correspondence with HMRC; and

-

in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments;

-

assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and

-

evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members, including those working on the audits of the subsidiary undertakings, and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

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.

Henry Lloyd-Davies (Senior Statutory Auditor)

for and on behalf of Bevan Buckland Audit Ltd (Statutory Auditors)

Ground Floor Cardigan House

Castle Court

Swansea Enterprise Park

Swansea

SA7 9LA

28 October 2026

TURNOVER

4

16,605,910

19,385,397

Cost of sales

14,815,463

17,775,746

GROSS PROFIT

1,790,447

1,609,651

Administrative expenses

2,053,799

2,140,967

(263,352

)

(531,316

)

Other operating income

712,554

571,650

OPERATING PROFIT

6

449,202

40,334

Interest receivable and similar income

7,860

17,232

457,062

57,566

Interest payable and similar expenses

8

11,316

(165,917

)

PROFIT BEFORE TAXATION

445,746

223,483

Tax on profit

9

(25,851

)

711,896

PROFIT/(LOSS) FOR THE FINANCIAL YEAR

471,597

(488,413

)

Profit/(loss) attributable to:

Owners of the parent

471,597

(488,413

)

PROFIT/(LOSS) FOR THE YEAR

471,597

(488,413

)

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

471,597

(488,413

)

Total comprehensive income attributable to:

Owners of the parent

471,597

(488,413

)

FIXED ASSETS

Intangible assets

11

6,562,775

7,593,971

Tangible assets

12

53,416

63,224

Investments

13

-

-

6,616,191

7,657,195

CURRENT ASSETS

Stocks

14

663,695

515,791

Debtors

15

4,707,296

4,531,576

Cash at bank

809,920

2,485,528

6,180,911

7,532,895

CREDITORS

Amounts falling due within one year

16

13,084,299

15,956,508

NET CURRENT LIABILITIES

(6,903,388

)

(8,423,613

)

TOTAL ASSETS LESS CURRENT LIABILITIES

(287,197

)

(766,418

)

CREDITORS

Amounts falling due after more than one year

17

(16,186

)

-

PROVISIONS FOR LIABILITIES

20

(606,526

)

(609,825

)

ACCRUALS AND DEFERRED INCOME

21

(225,000

)

(230,263

)

NET LIABILITIES

(1,134,909

)

(1,606,506

)

CAPITAL AND RESERVES

Called up share capital

22

100

100

Retained earnings

23

(1,135,009

)

(1,606,606

)

SHAREHOLDERS' FUNDS

(1,134,909

)

(1,606,506

)

The financial statements were approved by the Board of Directors and authorised for issue on 28 October 2026 and were signed on its behalf by:

T F Lewis - Director

FIXED ASSETS

Intangible assets

11

-

-

Tangible assets

12

-

-

Investments

13

18,935,775

18,935,775

18,935,775

18,935,775

CURRENT ASSETS

Debtors

15

1,569,125

820,286

Cash at bank

7,474

1,543,581

1,576,599

2,363,867

CREDITORS

Amounts falling due within one year

16

11,443,717

13,590,068

NET CURRENT LIABILITIES

(9,867,118

)

(11,226,201

)

TOTAL ASSETS LESS CURRENT LIABILITIES

9,068,657

7,709,574

CAPITAL AND RESERVES

Called up share capital

22

100

100

Retained earnings

23

9,068,557

7,709,474

SHAREHOLDERS' FUNDS

9,068,657

7,709,574

Company's profit for the financial year

1,359,083

1,185,645

The financial statements were approved by the Board of Directors and authorised for issue on 28 October 2026 and were signed on its behalf by:

T F Lewis - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 February 2024

100

(1,118,193

)

(1,118,093

)

Changes in equity

Total comprehensive income

-

(488,413

)

(488,413

)

Balance at 31 January 2025

100

(1,606,606

)

(1,606,506

)

Changes in equity

Total comprehensive income

-

471,597

471,597

Balance at 31 January 2026

100

(1,135,009

)

(1,134,909

)

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 February 2024

100

6,523,829

6,523,929

Changes in equity

Total comprehensive income

-

1,185,645

1,185,645

Balance at 31 January 2025

100

7,709,474

7,709,574

Changes in equity

Total comprehensive income

-

1,359,083

1,359,083

Balance at 31 January 2026

100

9,068,557

9,068,657

Cash flows from operating activities

Cash generated from operations

1

(993,339

)

3,800,355

Interest paid

(11,316

)

165,917

Tax paid

(676,349

)

(452,825

)

Net cash from operating activities

(1,681,004

)

3,513,447

Cash flows from investing activities

Purchase of tangible fixed assets

(464

)

(91,711

)

Sale of tangible fixed assets

-

141,332

Interest received

7,860

17,232

Net cash from investing activities

7,396

66,853

Cash flows from financing activities

Loan note repayments

-

(1,968,607

)

Amount introduced by directors

-

10,000

Amount withdrawn by directors

(2,000

)

(860,286

)

Net cash from financing activities

(2,000

)

(2,818,893

)

(Decrease)/increase in cash and cash equivalents

(1,675,608

)

761,407

Cash and cash equivalents at beginning of year

2

2,485,528

1,724,121

Cash and cash equivalents at end of year

2

809,920

2,485,528

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

2026

2025

£

£

Profit before taxation

445,746

223,483

Depreciation charges

10,272

53,683

Loss on disposal of fixed assets

-

16,687

Amortisation charges

1,031,196

991,196

Balances due to common entities waived

(409,243

)

-

Finance costs

11,316

(165,917

)

Finance income

(7,860

)

(17,232

)

1,081,427

1,101,900

(Increase)/decrease in stocks

(147,904

)

30,588

Decrease in trade and other debtors

103,376

8,252,903

Decrease in trade and other creditors

(2,030,238

)

(5,585,036

)

Cash generated from operations

(993,339

)

3,800,355

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 31 January 2026

31.1.26

1.2.25

£

£

Cash and cash equivalents

809,920

2,485,528

Year ended 31 January 2025

31.1.25

1.2.24

£

£

Cash and cash equivalents

2,485,528

1,724,121

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

2,485,528

(1,675,608

)

809,920

2,485,528

(1,675,608

)

809,920

Debt

Debts falling due within 1 year

(100

)

-

(100

)

(100

)

-

(100

)

Total

2,485,428

(1,675,608

)

809,820

1.	GOING CONCERN

The financial statements have been prepared on a going concern basis.

At 31 January 2026 the group had net liabilities of £1,134,909 and net current liabilities of £6,903,388. The net liabilities arise from cumulative goodwill amortisation on the acquisition of the trading subsidiaries, rather than from trading losses. The trading subsidiaries continue to report net assets and generated an operating profit before goodwill amortisation of £1.48 million in the year. The large majority of the group’s current liabilities are payments received on account and deferred income on contracts. These will be settled through the performance of contract work rather than in cash. The group had no bank borrowings at the year end.

The directors have prepared cash flow forecasts covering a period of at least twelve months from the date of approval of these financial statements. These forecasts show that the group is expected to have sufficient resources to meet its liabilities as they fall due. After the year end, on 3 August 2026, the company raised £204,120 in cash through a rights issue.

The parent company’s net current liabilities arise mainly from amounts owed to its subsidiary undertakings. The directors do not expect these balances to be called for repayment where this would leave the company unable to meet its other liabilities.

Having considered these factors, the directors have a reasonable expectation that the group and the company have adequate resources to continue in operational existence for the foreseeable future. They have not identified any material uncertainties that may cast significant doubt on the ability of the group or the company to continue as a going concern.

2.	STATUTORY INFORMATION

E G Lewis Group Industrial Services Ltd is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.

3.	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.

Functional and presentation currency

The financial statements are presented in Pound Sterling (£), which is the functional currency of the company and the group. Monetary amounts in these financial statements are rounded to the nearest £1.

Basis of consolidation

The consolidated financial statements incorporate the financial statements of the company and its subsidiary undertakings, made up to 31 January each year, and have been prepared using the acquisition method of accounting.

Subsidiaries are entities controlled by the group. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. Control is presumed to exist where the parent owns, directly or indirectly, more than half of the voting power of an entity.

The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.

All intra-group transactions, balances, income and expenses, and any unrealised gains and losses arising from intra-group transactions, are eliminated on consolidation.

Exemptions for the parent company

As permitted by Section 408 of the Companies Act 2006, the parent company has not presented its own income statement.

The parent company has taken advantage of the exemption in paragraph 1.12(b) of FRS 102 from presenting its own statement of cash flows, on the basis that it is included in these consolidated financial statements.

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

Estimates and judgements are continually evaluated. They are based on historical experience and other factors, including expectations of future events that are believed to be reasonable in the circumstances.

Critical judgements in applying the group’s accounting policies

The directors do not consider there to be any critical accounting judgements in preparing the financial statements.

Key accounting estimates and assumptions

i) Long-term contracts. Revenue on long-term contracts is recognised by reference to the stage of completion. This requires management to estimate the total costs to complete each contract and, in forecasting contract profitability, to make best estimates of the impact of customer disputes and claims. Any expected losses are recognised immediately in the income statement.

ii) Goodwill. The useful economic life of goodwill and the assessment of whether there are indicators of impairment require judgement. In making that assessment the directors consider the forecast performance of the acquired businesses.

iii) Dilapidations. The dilapidations provision is based on management’s best estimate of the cost of restoring leased premises to their original condition at the end of the lease.

Turnover

Turnover from the sale of goods is recognised in the profit and loss account when significant risks and rewards of ownership have been transferred to the buyer. Turnover from the projects or contracts is recognised as income in proportion to the stage of completion of the transaction at the balance sheet date. The stage of completion is assessed depending on the specific circumstances of each case. No turnover is recognised if there are significant uncertainties regarding recovery of the consideration due to associated costs, or there is the possibility of return of the goods. Turnover represents the sale of goods/revenue from contracts, excluding tax.

Goodwill

Goodwill, being the amount paid in connection with the acquisition of a business in 2022, is being amortised evenly over its estimated useful life of ten years.

Goodwill arising on the acquisition of subsidiary undertakings is the difference between the fair value of the consideration paid and the fair value of the identifiable assets and liabilities acquired. It is capitalised as an intangible asset and amortised on a straight-line basis over its estimated useful economic life of 10 years. Goodwill is reviewed for impairment where there are indicators that its carrying amount may not be recoverable.