Registered number: 03689515
COMPANY INFORMATION
CONTENTS
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The business performance in 2024 was impacted by several significant events. One key contract saw a material change in expected profitability due to a change in the estimated cost to completion, and the program is now expected to make a loss. A full root cause analysis has been completed and mitigations against further losses are in place. As the contract was nearing completion, the majority of this cost has been incurred with a small loss provision recorded for the remaining balance resulting in a significant decrease in Profit compared to 2023.
Due to revenue decreasing by 51% from prior year, the anticipated ramp down of projects as they near completion and a lack of new business awards, management took restructuring action during the year to right size the business to meet the current level of backlog and to reflect the strategic decision to focus on autonomous software capabilities and cease manufacturing. This resulted in a 48% reduction in headcount compared to 2023.
Due to revenue decreasing by 51% from prior year, the anticipated ramp down of projects as they near completion and a lack of new business awards, management took restructuring action during the year to right size the business to meet the current level of backlog and to reflect the strategic decision to focus on autonomous software capabilities and cease manufacturing. This resulted in a 48% reduction in headcount compared to 2023.
To leverage L3Harris’ UK corporate footprint, optimize the remaining workforce, create synergies, and improve profitability management have decided to combine L3Harris Autonomous Surface Vehicles Limited with L3Harris MAPPS Limited to form a new Maritime UK business in early 2026.
The new consolidated entity will continue its focus to develop and build on our position of a global market leader in the Unmanned Surface Vehicles (USV) market. Our strategy is to help customers to adopt this nascent technology by continued software development and conversion opportunities and to be at the forefront of the development of autonomous USV technology.
Market Development
Our strategy is to work with existing and potential users to understand use cases to help shape future procurement strategies and legislation to facilitate future opportunities. These activities are significant as the global USV market continues its significant growth, with increasing numbers of naval customers seeking to improve their autonomous capabilities. The business is seeing increased levels of customer interest in our products and services following successful demonstration of our autonomous capabilities, resulting in a strong pipeline of opportunities. These opportunities will be transferred and managed as a USV product line within the new Maritime UK business, which will also be complementary to customer solutions already offered by L3Harris MAPPS Ltd.
The new consolidated entity will continue its focus to develop and build on our position of a global market leader in the Unmanned Surface Vehicles (USV) market. Our strategy is to help customers to adopt this nascent technology by continued software development and conversion opportunities and to be at the forefront of the development of autonomous USV technology.
Market Development
Our strategy is to work with existing and potential users to understand use cases to help shape future procurement strategies and legislation to facilitate future opportunities. These activities are significant as the global USV market continues its significant growth, with increasing numbers of naval customers seeking to improve their autonomous capabilities. The business is seeing increased levels of customer interest in our products and services following successful demonstration of our autonomous capabilities, resulting in a strong pipeline of opportunities. These opportunities will be transferred and managed as a USV product line within the new Maritime UK business, which will also be complementary to customer solutions already offered by L3Harris MAPPS Ltd.
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STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The company faces risk associated with a successful merger of the two entities. This includes the operation and integration of business processes, IT systems, cultural clashes, loss of talent and customer disruption. There are also legal and compliance risks that need to be managed to address regulatory requirements, contract changes, employment law issues and data privacy and IT integration. Management's intent is to draw on the resources of the L3Harris corporation and the experience and knowledge within the wider organisation to manage these risks.
The company operates within the defence sector and is therefore exposed to a range of risks and uncertainties that may impact the delivery of its strategic objectives. These include potential changes in government defence spending, procurement priorities, and programme requirements, as well as shifts in geopolitical conditions that influence customer demand and international collaboration. The company is also exposed to risks arising from non-compliance with applicable defence, export control, and security regulations. In addition, there are risks associated with the performance and resilience of subcontractors and suppliers, including supply chain disruption, material shortages, and resource constraints.
The company is also exposed to risks associated with cybersecurity threats and the potential for significant disruption to its information technology networks, systems, and autonomous platforms. A major security breach, data loss, or sustained system outage could adversely affect operational capability and programme delivery. To mitigate these risks, the company has implemented a comprehensive cyber and information security framework incorporating preventive controls, continuous monitoring, and robust incident response procedures. These measures are supported by physical, technical, and procedural safeguards designed to protect sensitive data and maintain the resilience of critical systems.
The company maintains comprehensive risk management, compliance, and governance frameworks to identify, assess, and mitigate these and other risks in support of sustained operational performance and the delivery of customer commitments.
The company operates within the defence sector and is therefore exposed to a range of risks and uncertainties that may impact the delivery of its strategic objectives. These include potential changes in government defence spending, procurement priorities, and programme requirements, as well as shifts in geopolitical conditions that influence customer demand and international collaboration. The company is also exposed to risks arising from non-compliance with applicable defence, export control, and security regulations. In addition, there are risks associated with the performance and resilience of subcontractors and suppliers, including supply chain disruption, material shortages, and resource constraints.
The company is also exposed to risks associated with cybersecurity threats and the potential for significant disruption to its information technology networks, systems, and autonomous platforms. A major security breach, data loss, or sustained system outage could adversely affect operational capability and programme delivery. To mitigate these risks, the company has implemented a comprehensive cyber and information security framework incorporating preventive controls, continuous monitoring, and robust incident response procedures. These measures are supported by physical, technical, and procedural safeguards designed to protect sensitive data and maintain the resilience of critical systems.
The company maintains comprehensive risk management, compliance, and governance frameworks to identify, assess, and mitigate these and other risks in support of sustained operational performance and the delivery of customer commitments.
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STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
This report was approved by the board and signed on its behalf.
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DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The directors present their report and the financial statements for the year ended 31 December 2024.
The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom ("UK") Generally Accepted Accounting Practice (UK Accounting Standards and applicable law), including Financial Reporting Standard 102 'The Financial Standard applicable in the UK and the Republic of Ireland' ("FRS 102"). 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 Group and of the profit or loss of the Group for that period.
In preparing those financial statements, the directors are required to:
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 ("UK") Generally Accepted Accounting Practice (UK Accounting Standards and applicable law), including Financial Reporting Standard 102 'The Financial Standard applicable in the UK and the Republic of Ireland' ("FRS 102"). 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 Group and of the profit or loss of the Group for that period.
In preparing those financial statements, the directors are required to:
The loss for the year, after taxation, amounted to £10,159,453 (2023 - loss £3,276,254).
The directors who served during the year were:
The company has chosen in accordance with Section 414C(11) of the Companies Act 2006 (Strategic Report and
Directors' Report) Regulations 2013 to set out within the company's Strategic Report the Company's Strategic Report
Information Required by Schedule 7 of the Large and Medium Sized Companies and Groups (Accounts and Reports)
Regulation 2008. This includes information that would have been included in the business review and details of the
principal risks and uncertainties.
Directors' Report) Regulations 2013 to set out within the company's Strategic Report the Company's Strategic Report
Information Required by Schedule 7 of the Large and Medium Sized Companies and Groups (Accounts and Reports)
Regulation 2008. This includes information that would have been included in the business review and details of the
principal risks and uncertainties.
Going concern
To leverage L3Harris’ UK corporate footprint, management have made the decision to combine L3Harris Autonomous Surface Vehicles Limited with L3Harris MAPPS Limited to form a new Maritime UK business. This is to ensure that the company is best optimised to deliver for our customers and key stakeholders.
The result of this is L3Harris Autonomous Surface Vehicles Limited will cease operating activities from 2026 and remain as a non-trading company. As such the Financial Statements have been prepared on an other than going concern basis.
To leverage L3Harris’ UK corporate footprint, management have made the decision to combine L3Harris Autonomous Surface Vehicles Limited with L3Harris MAPPS Limited to form a new Maritime UK business. This is to ensure that the company is best optimised to deliver for our customers and key stakeholders.
The result of this is L3Harris Autonomous Surface Vehicles Limited will cease operating activities from 2026 and remain as a non-trading company. As such the Financial Statements have been prepared on an other than going concern basis.
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The auditors, Ernst & Young LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF L3HARRIS AUTONOMOUS SURFACE VEHICLES LIMITED
In our opinion, except for the possible effects of the matter described in the basis for qualified opinion section of our report, the financial statements:
Management were unable to facilitate a count of physical inventories for the year-end inventory listing at the period-end due to inadequate inventory management. We were unable to satisfy ourselves by alternative means concerning the inventory quantities held on 31 December 2024 which are included in the balance sheet at £493,262, by using other audit procedures.
Consequently, we were unable to determine whether any adjustment to this amount was necessary.
In addition, we were unable to satisfy ourselves concerning the inventory quantities in the prior periods ending 31 December 2022 of £875,551 and 31 December 2023 of £289,161. Our audit opinions on the financial statements for periods ending 31 December 2022 and 31 December 2023 were modified accordingly. Consequently, we were unable to determine whether any adjustment to these amounts at 31 December 2022 and 31 December 2023 were necessary or whether there was any consequential effect on the cost of sales for the year ended 31 December 2024 and the comparability of the current period’s figures and the corresponding figures.
Were any adjustment to the inventory balance to be required, the strategic report would also need to be amended.
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 qualified opinion.
Consequently, we were unable to determine whether any adjustment to this amount was necessary.
In addition, we were unable to satisfy ourselves concerning the inventory quantities in the prior periods ending 31 December 2022 of £875,551 and 31 December 2023 of £289,161. Our audit opinions on the financial statements for periods ending 31 December 2022 and 31 December 2023 were modified accordingly. Consequently, we were unable to determine whether any adjustment to these amounts at 31 December 2022 and 31 December 2023 were necessary or whether there was any consequential effect on the cost of sales for the year ended 31 December 2024 and the comparability of the current period’s figures and the corresponding figures.
Were any adjustment to the inventory balance to be required, the strategic report would also need to be amended.
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 qualified opinion.
We draw attention to note 2.3 to the financial statements which explains that the directors intend to cease trading in this entity and transfer the trade and assets to L3Harris MAPPS Limited in 2026 and therefore do not consider it to be appropriate to adopt the going concern basis of accounting in preparing the financial statements. Accordingly the financial statements have been prepared on a basis other than going concern as described in note 2.3. Our opinion is not modified in respect of this matter.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF L3HARRIS AUTONOMOUS SURFACE VEHICLES LIMITED (CONTINUED)
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 this 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 the other information, we are required to report that fact.
As described in the basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the inventory quantities held at 31 December 2022, 31 December 2023 and at 31 December 2024. We have concluded that where the other information refers to the inventory balance or related balances such as cost of sales, it may be materially misstated for the same reason.
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in this 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 the other information, we are required to report that fact.
As described in the basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the inventory quantities held at 31 December 2022, 31 December 2023 and at 31 December 2024. We have concluded that where the other information refers to the inventory balance or related balances such as cost of sales, it may be materially misstated for the same reason.
Except for the possible effects of the matter described in the basis for qualified opinion section of our report, in our opinion, based on the work undertaken in the course of the audit:
∙the information given in the strategic report and the directors’ report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
∙the strategic report and directors’ report have been prepared in accordance with applicable legal requirements.
Except for the matter described in the basis for qualified opinion section of our report, 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 directors’ report.
Arising solely from the limitation on the scope of our work relating to inventory, referred to above:
Arising solely from the limitation on the scope of our work relating to inventory, referred to above:
∙we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and
∙we were unable to determine whether adequate accounting records have been kept.
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:
∙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.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF L3HARRIS AUTONOMOUS SURFACE VEHICLES LIMITED (CONTINUED)
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.
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect irregularities, including fraud. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management.
- Review of all minutes of board meetings held during the period and through to the most recent meeting held prior to the approval of these financial statements;
- Review of accounting policies and completion of a disclosure checklist to assess compliance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” and Company law requirements;
- Review of any relevant correspondence with local tax authorities; and
- Review of any relevant correspondence received from regulatory bodies
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF L3HARRIS AUTONOMOUS SURFACE VEHICLES LIMITED (CONTINUED)
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.
for and on behalf of
Chartered Accountants
Statutory Auditor
R+ Building
2 Blagrave Street
RG1 1AZ
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STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2024
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STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 13 to 27 form part of these financial statements.
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STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
L3Harris Autonomous Surface Vehicles Limited is a private company limited by shares incorporated in England and Wales. The address of the registered office is disclosed on the company information page. The principal place of business is 11 Murrills Estate, Portchester, Hampshire, PO16 9RD, UK.
2.Accounting policies
The directors recognise that the company will cease as an operating entity with the next 12 to 18 months. The operations of L3Harris Autonomous Surface Vehicles Limited will be merged into L3Harris MAPPS Limited where the business will continue to develop its autonomous solutions and serve its customers under a new Maritime UK organisation. The operating assets and liabilities will be transferred to L3Harris MAPPS Limited and L3Harris Autonomous Surface Vehicles Limited will remain as a non-operating company. As required by the accounting standards, the financial statements have therefore been prepared on a basis other than going concern.
As the company plans to continue to trade during 2025 whilst plans are put in place to merge the business, the directors have determined that the accounting policies applied to individual items should be consistent with those adopted in the prior year. As the entity expects to transfer balance sheet and liabilities at book value the preparation on a basis other than going concern has not resulted in any further accounting treatment changes.
As the company plans to continue to trade during 2025 whilst plans are put in place to merge the business, the directors have determined that the accounting policies applied to individual items should be consistent with those adopted in the prior year. As the entity expects to transfer balance sheet and liabilities at book value the preparation on a basis other than going concern has not resulted in any further accounting treatment changes.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
∙the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
∙the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
∙the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of L3Harris Technologies Inc. as at 31 December 2024 and these financial statements may be obtained from L3Harris Technologies Inc. 1025 West NASA boulevard, Melbourne, Florida.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
To leverage L3Harris’ UK corporate footprint, management have made the decision to combine L3Harris Autonomous Surface Vehicles Limited with L3Harris MAPPS Limited to form a new Maritime UK business. This is to ensure that the company is best optimised to deliver for our customers and key stakeholders.
The result of this is L3Harris Autonomous Surface Vehicles Limited will cease operating activities from 2026 and remain as a non-trading company. As such the Financial Statements have been prepared on an other than going concern basis.
The result of this is L3Harris Autonomous Surface Vehicles Limited will cease operating activities from 2026 and remain as a non-trading company. As such the Financial Statements have been prepared on an other than going concern basis.
Functional and presentation currency
Transactions and balances
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Changes to the contracts or agreed with the customer and the contract value and cost to complete increased accordingly, where an increase in costs is not recoverable, the necessary adjustment to revenue recognition would be made if deemed material.
Rendering of services
Revenue relating to ongoing support and maintenance service agreements is accrued where billed in arrears and is recognised evenly over the billed period per contract terms. Revenue from the supply of spare parts is recognised at the point of time of despatch and is accrued if not billed.
Contract assets and contract liabilities
Where revenue on a contract is recognised in advance of invoicing, the asset is presented as a contract asset. Where amounts invoiced exceed the revenue recognised on a contract, the liability is presented as a contract liability.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
All company-sponsored research and development costs are expensed to the income statement as incurred, and are included within administrative expenses.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a reducing balance basis.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Basic financial assets
Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.
Basic financial liabilities
Basic financial liabilities including trade and other payables and interest-bearing loans and borrowing, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the liability is measured at the present value of the future payments discounted at a market rate of interest.
Basic financial liabilities, other than short term payables, are subsequently carried at amortised cost, using the effective interest rate method. The effective interest rate amortisation is included in interest payable and similar expenses in the income statement.
Short term trade and other payables with no stated interest rate which are payable within one year are recorded at transaction price.
Basic financial liabilities
Basic financial liabilities including trade and other payables and interest-bearing loans and borrowing, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the liability is measured at the present value of the future payments discounted at a market rate of interest.
Basic financial liabilities, other than short term payables, are subsequently carried at amortised cost, using the effective interest rate method. The effective interest rate amortisation is included in interest payable and similar expenses in the income statement.
Short term trade and other payables with no stated interest rate which are payable within one year are recorded at transaction price.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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.
These 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 main area of accounting estimates are:
Stage of completion of construction contracts
The company’s activities include the delivery of bespoke Unmanned Surface Vehicles (USV) solutions to customers. These can involve the construction of bespoke vessels which can take years to complete. Revenue from construction of bespoke USV’s is recognised by reference to the stage of completion. Stage of completion is measured by reference to costs incurred to date as a percentage of total estimated costs for each contract. Where the contract outcome cannot be measured reliably, revenue is recognised only to the extent of the expenses recognised that are recoverable. An expected loss on the contract is recognised immediately as an expense.
As these projects are bespoke and non-standard, there can be estimation uncertainty over the costs to complete. The companies budgeting and project monitoring procedures ensure that the costs to date and costs to complete each project are regularly updated. Each project has a dedicated project manager who takes responsibility for cost tracking and overall progress on contracts is regularly reviewed by management. The contract assets and contract liabilities recognised in respect of the construction projects are detailed in note 2.5. A provision has been made for an estimated loss on one contract.
Stock provision
A provision of 100% has been made against all items of stock that have not moved in the past 12 months to allow for the cost of stock obsolescence.
In addition an assessment on the net realisable value (NRV) of stock was performed by reviewing stock with zero usage in the 9 months following the balances sheet date, resulting in an additional provision.
Warranty provision
No warranty provision has been established based on the terms and conditions of contracts; prior year warranty provision was utilised within the year with the remaining balance extinguished.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Analysis of turnover by country of destination:
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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