The directors present the strategic report for the year ended 31 March 2026.

The principal activities of the company continue to be that of design, manufacture and maintenance of paint finishing plants, vertical platform lifts and general subcontract sheet metal manufacture.

We aim to present a balanced and comprehensive review of the development and performance of our business during the year and its position at the year end. Our review is consistent with the size and relatively non-complex nature of the company and is written in the context of the risks and uncertainties we face.

We consider that our key financial performance indicators are those that communicate the financial performance and strength of the company, being turnover, gross margin percentage, operating profit and return on capital employed.

Sales increased by 30% from £7.8m to £10.1m. The operating profit this year was £69,410 with a gross margin percentage of 34.1% compared with an operating loss of (£524,561) and 32.9% for the previous year.

Return on capital employed has been 4% compared with (28)% for the previous year. Return on capital employed is calculated as profit before interest and tax divided by capital employed, which constitutes total assets less current liabilities, less investments, less cash, plus overdrafts and other short term borrowings.

The principal risks and uncertainties affecting the company are continually monitored by the directors, who seek to mitigate any such risks. As for many manufacturers of our size, the business environment in which we operate continues to be challenging and highly competitive. The company responds to this risk by continually extending the product range, improving operational effectiveness, providing a strong brand identity and investing in the future of the business. As the result of sales initiatives and product developments, we are pleased to report having a strong order book.

Impact of inflation rates

The high inflationary rates are being offset both in reviewing the materials and processes used in manufacturing products, as well as other cost reduction schemes before passing any cost increases to customers. The directors are confident that the company will remain competitive on prices. High energy prices are somewhat offset due to contract end dates. The company also self-generates a considerable percentage of energy required through our array of solar panels.

On behalf of the board

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

The results for the year are set out on page 7.

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

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

Continued research and development is entered into by the company to ensure that innovative and new products are available to the market.

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

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

• select suitable accounting policies and then apply them consistently;

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

• 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.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

We have audited the financial statements of Harry Dalby Engineering Limited (the 'company') for the year ended 31 March 2026 which comprise the Statement of Income and Retained Earnings, the Balance Sheet, the Statement of Cash Flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

• give a true and fair view of the state of the company's affairs as at 31 March 2026 and of its 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 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 contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of 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 our audit:

• the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.

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

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

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

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

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

As explained more fully in the Directors' Responsibilities Statement set out on page 2, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. 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.

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. However, responsibility for the prevention and detection of fraud ultimately rests with both those charged with governance and management of the company.

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:

• obtaining an understanding of the legal and regulatory framework applicable to the company by considering the nature of the industry in which the company operates and enquiring of management; and

• identifying the key laws and regulations considered to have a direct impact on the financial statements including the UK Companies Act 2006, UK Generally Accepted Accounting Practice and UK tax legislation; and

• assessing how the company is complying with the applicable legal and regulatory framework by making further enquiries of management and observing the company's control environment regarding compliance with regulations and fraud prevention; and

• assessing the susceptibility of the company’s financial statements to material misstatement, including how fraud might occur, by considering the effectiveness of the company’s accounting systems and controls and how these were monitored by management. Performance related targets and bonuses were also considered. Where the risk of material misstatement was considered to be higher in certain areas, further audit procedures were designed to address this increased risk; and

• discussing amongst the engagement team how and where fraud might occur in the financial statements and any potential indicators of fraud.

Our procedures to respond to risks identified included the following:

• reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations; and

• enquiry of company staff responsible for compliance to identify any instances of non-compliance with laws and regulations; and

• enquiry of management, those charged with governance and other relevant parties around actual and potential litigation claims; and

• performing audit work over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias; and

• performing audit work over revenue recognition including substantive tests of detail of a sample of revenue transactions; and

• communicating identified laws and regulations and potential fraud risks to all engagement team members and assessing whether there are any indications of fraud or non-compliance with laws and regulations throughout the audit.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

The profit and loss account has been prepared on the basis that all operations are continuing operations.

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

Harry Dalby Engineering Limited is a private company limited by shares incorporated in England and Wales. The registered office is 205 Gloucester Crescent, Wigston, Leicester, LE18 4YQ.

These financial statements have been prepared in accordance with applicable accounting standards including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties (in accordance with FRS 102). The principal accounting policies adopted are set out below. These policies have been consistently applied to all years presented unless otherwise stated.

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Turnover is recognised at the fair value of the consideration received or receivable for goods and services supplied, net of VAT and trade discounts.

Turnover from the sale of goods is recognised on the date of despatch as this is the point at which the significant risks and rewards of ownership of the goods are transferred to the customer.

Turnover from construction contracts is recognised by reference to the stage of completion of the contract activity at the end of the reporting period when the stage of completion, costs incurred and costs to complete can be estimated reliably. The “percentage of completion method” is used to determine the appropriate amount of revenue to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the estimated total contract costs.

Turnover from maintenance services is recognised on the date that such services are provided.

Tangible fixed assets are measured at cost or valuation, net of depreciation and any impairment losses.

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

The estimated residual value of freehold buildings is such that their depreciable amount is insignificant. Accordingly, no depreciation is charged on freehold buildings.

The company has adopted the transition exemption under FRS 102 paragraph 35.10(c) and has elected to measure the freehold property held at the date of transition to FRS 102 at its fair value and use that fair value as the deemed cost for this property.

Stocks and work in progress are stated at the lower of cost and estimated selling price. Cost comprises the direct material costs and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition. Provision is made for damaged, obsolete and slow-moving stock where appropriate.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Debtors and creditors with no stated interest rate and receivable or payable within one year are measured at transaction price. Any losses arising from impairment are recognised in the profit and loss account.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.

When employees have rendered service to the company, short-term employee benefits to which the employees are entitled are recognised at the undiscounted amount expected to be paid in exchange for that service.

The cost of any unused holiday entitlement is recognised in the period in which the employee's services are recognised.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

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

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements.

Rentals payable under operating leases, including any lease incentives received, are charged to the profit and loss account on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

Research and development

Research and development expenditure is written off to the profit and loss account in the year in which it is incurred.

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

As explained in note 1.3, where the outcome of construction contracts can be estimated reliably, contract revenues and costs are recognised on a contract by contract basis using the percentage of completion method. The application of this accounting policy requires both the total costs and the stage of completion of contracts to be assessed. An inherent degree of judgement will exist in determining the stage of completion of a contract at the end of the reporting period.

An analysis of the company's turnover is as follows:

Included in turnover is revenue of £4,155,604 (2025 - £3,219,481) arising on construction contracts in the year.

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

Their aggregate remuneration comprised:

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

The actual credit for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases.

The company has adopted the transition exemption under FRS 102 paragraph 35.10(c) and has elected to measure the freehold property held at the date of transition to FRS 102 at its fair value and use that fair value as the deemed cost for this property.

The freehold property was last revalued in 2015 on the basis of existing use value by independent qualified valuers. The resulting revaluation adjustments were taken to the revaluation reserve.

The freehold property has been pledged as security for the bank borrowings of the parent undertaking, further details of which are disclosed in note 22.

If revalued assets were stated on a historical cost basis rather than a fair value basis, the total amounts included would have been as follows:

The trade debtors balance includes £804,326 (2025: £Nil) which is covered by an invoice discounting arrangement. These assets have not been derecognised from the balance sheet because the company remains ultimately responsible for any unpaid balances, so the directors consider significant risks to have been retained.

The aggregate amount of creditors for which security has been given amounts to £420,298 (2025: £412,336). Finance leases are secured on the assets to which they relate.

Finance leases relate to motor vehicles and plant and machinery.

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

There is a single class of ordinary shares. There are no restrictions on the distribution of dividends and the repayment of capital.

The revaluation reserve comprises a revaluation surplus for the freehold property offset by the related deferred tax liability.

The capital redemption reserve represents the purchase of own shares by the company.

The profit and loss reserve comprises retained profits and losses for the current and prior periods.

Under the terms of interlocking guarantees, Dalby Holdings Limited, Harry Dalby Engineering Limited, Regent Engineers Limited and Phoenix Aluminium Limited jointly and severally undertook to satisfy on demand all sums owing to finance providers by the other parties to the agreements. At 31 March 2026 the net amount owing to these finance providers by the other group undertakings was £1,765,193 (2025 - £2,492,512).

The company acts as guarantor for a loan totalling £1,980,000 (2025 - £Nil) held by a fellow group company.

The company has taken advantage of the exemption offered by FRS 102 from the requirement to disclose transactions with other group companies that are wholly owned.

To safeguard the Group moving forwards, the Directors have agreed to launch a new company called Dalby Engineering Services Limited. This new company will be used to invoice all our servicing and total care package customers and plans to commence trading in the second half of our financial year 2027.

The parent undertaking for which consolidated accounts are prepared is Dalby Holdings Limited, a company registered in England and Wales. Consolidated accounts are publicly available from Companies House, Cardiff.

The registered address of Dalby Holdings Limited is the same as the company's registered office address as given in the company information page of these financial statements.