Final Results, Analyst Briefing & Investor Pres

20 May 2025

Amcomri Group plc

("Amcomri", the "Company" or the "Group")

Final Results

Analyst Briefing & Investor Presentation

Record revenues, profit and margin prove growth model

Amcomri Group plc (AIM: AMCO), the "Buy, Improve, Build" UK focused, specialist engineering services and industrial manufacturing group, announces its Final Results for the 12 months ending 31 December 2024 ("FY24").

This was a pivotal period for the Company, culminating in its successful £12m fundraising and IPO on AIM in December 2024. With a proven acquisitive and organic growth strategy, the profitable and cash generative Group has a strong track record of value enhancing acquisitions of niche, mature and proven SMEs in the engineering and manufacturing sectors.

Financial Highlights

· Revenue increased by 23.4% to £58.1m (2023: £47.0m)

· Gross margin improved to 36.4% (2023: 32.2%)

· Adjusted EBITDA increased by 33.3% to £7.7m (2023: £5.8m)

· Net assets of £20.4m at 31 December 2024 (2023: £9.5m)

· Net debt (including deferred and contingent consideration payable) of £6.1m at 31 December 2024

· Cash balances of £12.1m at 31 December 2024 (2023: £4.0m)

Operational Highlights

· Successful IPO on AIM raising £12m in December 2024 - providing the platform for the next stage of profitable growth

· Delivery of a further three acquisitions in the year, core and aligned to the growth strategy, broadening the Group's offering

· Continued to build a high-performing and experienced team capable of delivering sustained value creation

· Positioned the Group to further capitalise on the significant growth it has delivered in its chosen specialist industrial sectors

Post Year End Highlights

· Completed the acquisition of EMC Elite Engineering Services Ltd, an established and proven sector specialist, adding new and highly technical capabilities to the Group with further potential for expansion and synergies

· Trading in FY25 has started well and is in line with expectations

Commenting on the results and outlook, Hugh Whitcomb, Co-Founder and CEO of Amcomri, said:

"The successful IPO concluded another record year for the Group and provides us with substantial foundations to deliver further progressive growth over the coming years. Our established 'Buy, Improve, Build' strategy delivered further strong profit, revenue and margin gains during FY24, and continues to provide significant scope for continued organic and acquisitive growth.

"Amcomri's strong balance sheet, resilient end markets, operational enhancements and intra-Group initiatives, underpin management's confidence in meeting market expectations for the current year, which continue to build on our successes of FY24. We have a healthy pipeline of prospective acquisitions which will allow us to deliver upon our strategy."

Analyst Briefing: 9.30 a.m. today, Tuesday 20 May

An online briefing for analysts will be hosted by Hugh Whitcomb, Chief Executive Officer, Mark O'Neill, Investment Director, and Siobhán Tyrrell, Chief Financial Officer, at 9.30 a.m. today, Tuesday 20 May, to review the FY24 final results and prospects. Analysts wishing to attend should contact Walbrook PR on [email protected] or 020 7933 8780.

Investor Presentation: 2.00 p.m. - Wednesday 21 May 2025

The Directors will hold an investor presentation to cover the FY24 results and prospects at 2.00 p.m. on Wednesday 21 May 2025.

The presentation will be hosted through the digital platform Engage Investor. Investors can sign up to attend the presentation via the following link https://engageinvestor.news/AMCO_IP25.

Questions can be submitted pre-event or in real time during the presentation via the "Ask a Question" function, alternatively by submitting to [email protected]. 

Certain of the information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the UK version of the EU Market Abuse Regulation (2014/596) which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended and supplemented from time to time.

Enquiries:

To find out more, please visit: www.amcomrigroup.com

Notes to Editors:

Amcomri is a "Buy, Improve, Build" group focusing on acquiring, integrating and enhancing specialist engineering services and industrial manufacturing businesses that provide technical services to major UK infrastructure, transportation and energy companies and bespoke mission-critical services to a diverse range of sectors and markets.

The Group currently operates through the following two divisions:

(i) Embedded Engineering Division: provides specialist technical and engineering services for major industrial, infrastructure and transportation clients, typically with complex technical needs and undertaken in operating environments where safety and compliance performance are critical requirements. The division predominantly provides engineering services and support for their clients' capital intensive, mission-critical assets such as high voltage electrical transmission systems, petrochemical and continuous process operations, and large power generation plants.

(ii) B2B Manufacturing Division: focuses on selective niche B2B markets or businesses, where the Group has identified an opportunity to achieve enhanced financial performance by leveraging an initially strong competitive market position combined with the Group's business improvement capabilities.

The Group operates across a diverse range of sectors and markets, including industrial, infrastructure and mass transportation. The Group deploys a structured "Buy, Improve, Build" strategy with a track record of value enhancing acquisitions in the industrial environment. It has a particular focus on leveraging the Group's experience and track record in relation to acquisitions arising from owner manager 'retirement' situations, where there are no, or limited, alternative plans for succession to sustain the enterprise value present within the target business.

The Group has been created through a series of 17 successful acquisitions, comprising the acquisition of 13 operating companies and 4 bolt-on asset/business purchases, each of which has been integrated into the Group. The Group's businesses have grown organically and are well placed to take advantage of the positive opportunities that exist in their respective end markets. This strategic approach has delivered compound annual Group revenue growth of 48.8 per cent. between FY21 and FY23.

 Chair's Statement

Our admission to AIM marks the beginning of an exciting new chapter, providing a dynamic platform to accelerate our growth strategy, driven by our agile and talented team, to capture and execute opportunities that deliver lasting value for our stakeholders.

The Group was admitted to trading on AIM on 20 December 2024 and we would like to thank all of our shareholders for their support in achieving this transformative milestone, which marks the beginning of an exciting new chapter for Amcomri Group plc.

Sincere thanks are extended to the executive team of Amcomri for their exceptional efforts in driving the organisational and operational change that led to our successful IPO.

Amcomri is a specialist engineering services and industrial manufacturing business that operates a 'Buy, Improve, Build' model focused on acquiring, integrating and enhancing businesses that provide technical services and bespoke mission-critical services to a diverse range of sectors and markets.

Our mission is to identify, acquire, and integrate businesses that align with our disciplined investment criteria, combining entrepreneurial agility with rigorous due diligence and post-deal integration, to enable delivery of strong growth and performance.

Since its inception, the Group has achieved rapid growth and continues to pursue ambitious, yet attainable, value accretive outcomes.

The Group has a substantial track record of identifying and acquiring SMEs in the technical engineering sector where there are opportunities to significantly improve performance and achieve a strong return on investment.

The Group was formally established in 2020 and as at 31 December 2024 had grown to 12 operating businesses delivering £58.1m of revenue, adjusted EBITDA of £7.7m and operating profit of £3.9m, as presented in this annual report.

The Group's admission to AIM serves to validate our vision and growth strategy, strengthening our platform for continued expansion through greater access to capital and enhanced visibility in the market.

The current macroeconomic headwinds present a significant challenge for businesses globally, but the diversity of the Group, alongside providing essential services with high barriers to entry, provides an effective hedge against the impact of these external factors on the performance of the Group.

The diligent, entrepreneurial and energetic approach of our talented team across the Group is central to its ongoing success and the Board extends its appreciation for their many continuing achievements.

The Board has adopted the QCA Corporate Governance Code. This represents a robust corporate governance framework that is appropriate to the size and nature of the Group. Transparency and integrity lie at the heart of our entrepreneurial and agile approach, with robust controls and oversight to support positive outcomes.

As we look to the future, we remain committed to disciplined growth, strong governance, and transparent communication with all our stakeholders.

Post year end, the Group completed the acquisition of EMC Elite Engineering Services Ltd, adding a new and highly synergistic capability to the Group.

The pipeline for acquisitions remains strong and the opportunities for organic growth are both substantial and actively being realised.

We look forward to keeping all our stakeholders informed as we progress on this well-defined strategic journey to deliver meaningful value creation, leveraging our solid foundation and the confidence of the public markets.

Thank you for your continued support.

Tanya Raynes

Chair 

Chief Executive Officer's Review

I am delighted to be able to present a further successive year of record results for Amcomri, based on a sound and resilient strategy that has been further strengthened by our successful IPO in December 2024.

The successful IPO of the Group on the AIM market in December 2024 provided a fitting highlight to another year of significant positive revenue and earnings growth achieved by the Amcomri team. The Group has now been provided with further substantial resources to continue to build on the prior success of its now proven 'Buy, Improve, Build' strategy, focused on specialist UK industrial markets. With the acquisitions delivered by our team in 2024, the Group completed the year with 12 autonomous operating companies in its two operating divisions, delivering consolidated revenue of £58.1m. The Group entered 2025 with a strong acquisition pipeline, sound market positioning, and solid organic growth prospects in its operating companies. Amcomri is exceptionally well positioned to continue its progressive and controlled development in 2025 and beyond.

Operating Divisions

Our two operating divisions and their operating companies have continued to perform strongly in their chosen market sectors during the year.

Our Embedded Engineering division provides specialist technical services and support to often mission critical power, petrochemical and process customers, and continues to see a high demand for its services driven by compliance, maintenance and performance or life extension upgrades of often ageing, capital intensive facilities. These underlying market drivers have delivered record revenue performance for our valves business in the year as many key customers undertake substantial maintenance shutdowns. Similarly, our rail focused businesses continue to see strong demand for their services as ageing rail rolling stock drives an increasing demand for upgrading and refurbishment of both electronic control and power electronics systems to ensure compliance and service reliability is maintained for the operators.

Rail network electrification infrastructure and upgrading projects continued to drive performance in our high voltage (HV) engineering business during the year, although the change of UK Government mid 2024 has generated some uncertainty over the timing of the next phase of previously anticipated rail infrastructure upgrade projects into 2025 and beyond. In common with other specialist technical service providers to this sector, we await further directional guidance. In the meantime, existing maintenance service and other HV system markets, including data centres, provide alternative HV engineering market extension opportunities.

The production electronics equipment market saw a reduction in demand for larger capital machine purchases, after a very strong post Covid supply chain uplift in 2023. However, the demand for technical service and calibration on the installed machine base continues to progressively build, despite a lower but more historically normalised, post pandemic, activity level in the new equipment sales area.

Our B2B Manufacturing Division has an established, well distributed, relatively stable end market base covering civil and military aviation components, subsea, defence, power and process sectors and specialist printing for the industrial and packaging industries.

With the addition of the Drurys and Claro precision engineering companies in 2024, we extended our coverage to include selected defence, aerospace, and subsea markets, the latter showing particularly strong growth prospects driven by increased oceanographic monitoring requirements associated with climate change.

Our specialist printing operations in Bex and Premier Limpet are more aligned with wider UK industrial cyclical activity trends. However, with the benefit of the Supreme Tapes acquisition, Premier Limpet has rapidly continued to consolidate its strong market position in 2024 by adding water activated paper tape to its product range to complement its established polymer tape-based products.

The industrial seals, gasket and jointing market served by JA Harrison is relatively mature and has continued to remain stable in the period, however, one of the major global suppliers of specialist polymer materials announced their intention to exit the PTFE product market by the end of 2025. This market change in a niche material area provides a potentially significant positive opportunity for JA Harrison which has significant experience of this material, and this will be a key area of focus for the company in 2025.

Acquisition Pipeline

The Group's target acquisition market, focused on UK SME specialist industrial businesses has remained strong over 2024. The strength of our pipeline of strategically aligned prospects is driven by both end market activity and increasingly a prospective vendor awareness of our interest and success in the sector. We have acquired six 'off market' opportunities with vendor direct approaches to the Group, since 2020.

Against our 'Buy, Improve, Build' strategy we successfully executed on three acquisitions in the year; Drurys and Claro in March 2024, acquired at a discounted entry point due to the accelerated nature of the acquisitions. In addition, Premier Limpet completed a synergistic bolt-on with the acquisition of Supreme Tapes in April 2024. In each case, ownership has been successfully transitioned to the Group, and all three acquisitions have subsequently seen progressive improvements in key performance metrics. We remain confident that all three will continue to build on the excellent start they have made under our ownership into 2025.

Having acquired, integrated and transitioned ownership of these three companies in 2024, we were delighted to be able complete a further synergistic addition to our Embedded Engineering Division in April 2025, EMC Elite Engineering. EMC brings to the Group extensive complementary experience of delivering high-quality maintenance and project engineering in the UK power generation, process and aggregate industry sectors.

Having now completed 17 acquisitions to date, the Amcomri team has significant experience sourcing transactions across its target industries allied with an established process and industry expertise, to continue with our acquisitive strategy.

Health, Safety, and ESG Commitment

Whilst the Group's safety performance metrics continue to be significantly better than comparable industrial sector averages in both of its operating divisions, regrettably the Group had 2 RLTA accidents in the year. The Board is committed to continuous improvement with respect to improving these metrics further across all of its operations and businesses.

As we enter 2025 this will continue to be a core focus for the Group, implemented via a comprehensive Health and Safety action plan that includes specialist third party audit, tracking and support across all operating companies. This will be supported by further progressive prioritised investment in Health and Safety improvement projects in our businesses.

In line with the Group's commitment to continuous improvement in ESG, two senior members of the Group team completed ESG training, and are now leading ESG data and process improvement facilitation in our operating companies. See our Sustainability Report for further details.

Outlook for 2025

The Group and its experienced management teams continued to focus on structured commercial development and operational performance improvements as key pillars of its strategy deployment in both operating divisions.

In the B2B Manufacturing Division, our Premier Limpet tapes business saw further significant benefits from its business improvement plan, driven by a series of structured internal production improvements and commercial service initiatives. We anticipate further progressive improvement in 2025 in this business with the continued roll out of specific improvement projects supported by selective investment in new advanced print machine technology and up-grading of existing machinery.

The rapidly executed acquisitions of Drurys and Claro in March 2024, allowed these two businesses which were previously part of a distressed group, to be quickly stabilised and returned to high standards of customer performance within a very short timeframe. In Claro, restoration of customer confidence and subsequent rapid volume uplifts supported investment in further capacity in late 2024, significantly ahead of the original post-acquisition plan. With operational performance restored and capacity added, pleasingly both Drurys and Claro have since seen significant performance improvements under our ownership. As we exit the year into 2025 both stand to further benefit from increasingly strong forward order positions in their respective markets during the year.

Our Embedded Engineering (EE) operations have succeeded in overcoming several operational challenges in the year, mainly related to rising customer activity levels. Both Blundell and TP Matrix have continued to successfully align capacity and demand for their services by recruiting experienced electronics technicians and engineers for their service and overhaul activities. Our process and power sector EE businesses have managed significant customer seasonal work peaks associated with plant shutdowns in the year, supported by quality sub contract resources to assist with site based works where appropriate.

People Development

The Group entered 2024 with a significant number of key positions to recruit, arising from its rapid expansion through acquisition, extension of its existing activities and planned retirements carried over from the prior year. Through 2024, 14 sector experienced and talented senior team members were successfully recruited into both our operating Divisions and at Group level.

In our drive to further develop our internal team's capability and expertise, and to progressively provide internal career progression opportunities, in 2024 we established a programme to facilitate leadership and management development within our operating companies. Through the combination of internal development programmes and recruitment in 2024, we enter 2025 fully resourced to deliver our 2025 Group objectives and operational plan.

In parallel, we continue to expand our apprenticeship programme within the Group operating companies, with 14 apprentices now employed across the Group in formal schemes at the end of the year.

Highlights and Outlook

2024 was a year of strong financial performance, with both organic and acquired growth contributing to improved profitability and scale. Consolidated revenue rose to £58.1m, reflecting increasing demand across both divisions and the positive impact of acquisitions. Adjusted EBITDA increased by 35.9% to £7.7m (2023: £5.8m). Operating cash flow was £6.8m, reflecting continued discipline in working capital management and stable operating cash flows across the operating companies. The Group enters 2025 with a solid financial position, bolstered by the placing proceeds from the IPO.

In addition to our acquisition strategy, progressive earnings growth, arising from both individual operating company development and by leveraging synergistic opportunities between our operating businesses, is a key element of the Group strategy.

Looking ahead, the Group remains focused on delivering its proven growth model, combining resilient, service-led businesses with operational improvements and strategic acquisitions. Supported by a strong market position, experienced leadership, and clear strategic priorities, the Group is well placed to continue delivering value in 2025 and beyond.

Hugh Whitcomb

Chief Executive

Chief Financial Officer's Review

I am pleased to present the financial review for the year ended 31 December 2024. The Group has delivered a strong performance against a backdrop of ongoing macroeconomic uncertainty, underpinned by disciplined cost control, robust cash management, and continued strategic investment to support long-term growth.

2024 was a positive year for the Group. Significant improvements were made across a number of the Group Companies, along with continued disciplined and opportunistic acquisitions being made with Drurys Engineering Limited and Claro Precision Engineering Limited being added to the Group in March 2024, all while completing a successful IPO process. These achievements took place against a backdrop of challenging external factors, marked by rising costs, and general economic uncertainty.

The Group saw continued revenue growth across both divisions, improved profit margins and completion of a capital raise and admission to the AIM Market of the London Stock Exchange. This has strengthened our balance sheet and ensures we have the resources required to continue the Group's strategy of identifying and acquiring, niche and mature SME engineering and manufacturing businesses, that provide an opportunity for the Group to use its extensive operational and engineering expertise to achieve progressive earnings growth.

Financial Performance

Revenue

Group revenues increased from £47.0m in 2023 to £58.1m in 2024, an increase of 23.4%. Across the Group's two divisions, Embedded Engineering revenues rose by £2.0m to £25.7m, and B2B Manufacturing revenues rose by £9.1m to £32.4m, mainly driven from the acquisitions of Drurys and Claro during the year.

Gross Margin

During 2024, gross margin improved 4.2% to 36.4% (2023: 32.2%). Most of the gross margin improvement was driven by higher margin performance within our operating companies.

Operating Expenses

Operating expenses increased in the year. Staff costs are the largest component of overheads, reaching £9.1m in 2024 (2023: £6.2m). The acquisitions of Drurys and Claro added to total overheads alongside investments in the Group cost base to support future growth.

Adjusted EBITDA

Adjusted EBITDA increased by £1.9m to £7.7m. Adjusted EBITDA growth was driven by a full year contribution from WJPS alongside the acquisitions of Drurys and Claro and improved trading across a number of the operating companies, particularly Premier Limpet and TP Matrix.

Profit

The Group reported an operating profit of £3.9m (2023: 3.0m), with statutory profit before tax of £1.7m (2023: £1.4m).

Finance costs

Interest paid increased by £0.6m to £2.2m in the year due to the increased costs associated with additional borrowing used to facilitate the acquisition of Drurys and Claro, and the full year impact of borrowings used to acquire WJPS.

Exceptional items

Exceptional items include a payment to Rockpool Acquisitions PLC to refund various costs in relation to an aborted reverse takeover of Amcomri Group.

Additional IPO related costs of £1.4m were incurred and have been included in exceptional costs in the year to 31 December 2024.

Earnings per share

The Group incurred £0.2m non-recurring reorganisation costs in 2023, £1.8m of IPO related professional fees in 2024. These exceptional expenses decreased the basic earnings per share growth to 10%. The adjusted earnings per share (adding back the exceptional expenses net of tax) increased by 116% to 8.2 pence.

 Cash Flow and Balance Sheet

We continue to maintain a prudent capital structure, with a focus on liquidity, flexibility and positive cashflow management. The Group maintained a strong cash position, with net cash of £12.1m at year-end (2023: £4.0m). This increase is largely related to funds raised at the IPO. Operating cash flow was £6.6m, reflecting continued discipline in working capital management and stable operating cash flows across the Group operating companies.

Cash expensed on the acquisition of subsidiaries in the year amounted to £1.3m, relating to the purchase of the trade and assets of Drurys and Claro in March 2024, together with the assets of Supreme Tapes, which was acquired as a bolt on to Premier Limpet in April 2024.

The Group's total assets include £17.3m (2023: £17.7m) of intangible assets, of which £10.5m (2023: £10.5m) relates to goodwill arising from past acquisitions. Goodwill is tested annually for impairment, or more frequently if there are indicators of potential impairment. No impairment was recorded during the year, as each cash-generating unit continues to perform in line with management expectations.

Other intangible assets also include capitalised development costs and software costs. We continue to invest in innovation and digital infrastructure and systems, and where appropriate, development costs meeting the recognition criteria under IAS 38 have been capitalised to reflect their future economic benefit.

As at the end of the year, the Group's net debt (including all fixed and contingent deferred consideration) stood at £6.1m, compared to £15.7m at the end of 2023. We remain confident in our ability to manage this position prudently, with robust cash flow management and strong financial discipline. Our debt remains well within the Group's covenant limits and is primarily long-term, with a maturity profile that aligns with our growth strategy.

We are committed to maintaining a conservative approach to debt, ensuring that any borrowings are used to fuel long-term, value-accretive initiatives. The Group continues to evaluate opportunities and acquisitions to optimise our capital structure, including exploring avenues for refinancing or additional facilities to fund strategic growth while maintaining a conservative leverage position.

Employees

We are pleased to report a year-on-year increase in employee numbers, reflecting our continued growth. Our workforce grew by 22%, with headcount reaching 365 at year-end (2023: 300). This expansion strengthens our operational capacity and underlines our ongoing commitment to investing in talent. We remain focused on fostering a supportive, diverse, and high-performing culture, and continue to prioritise learning, development and wellbeing across the Group.

We have implemented a Long Term Incentive Plan (LTIP) for key employees. Awards under the LTIP are designed to align awards are designed to align the interests of our employees with those of our shareholders, ensuring a focus on long-term value creation. As at year end the value of share options granted was £0.5m. The LTIP will be an important part of our retention and motivation strategy, contributing to a more engaged workforce.

Dividends

As an AIM-quoted company focused on reinvesting for growth, the Group does not currently operate a formal dividend policy and has not declared a dividend for the financial year. The Board believes that retaining earnings to support strategic initiatives and operational investment is in the best interests of shareholders at this stage of the Group's development. The dividend policy remains under review and will evolve in line with the Group's growth, profitability and capital requirements.

Risk Management and Going Concern

We continue to maintain a proactive approach to risk management, ensuring our financial controls and reporting frameworks remain robust. The Board has reviewed the Group's cash flow forecasts and sensitivities and is satisfied the Group has adequate resources to continue as a going concern.

Governance and ESG Reporting

Although we are not currently required to report under the Task Force on Climate-related Financial Disclosures (TCFD), we recognise the importance of climate-related transparency and have begun taking steps to align with TCFD principles on a voluntary basis. This includes emissions monitoring, and improved climate risk integration into our strategic planning. We also remain alert to developments regarding the International Sustainability Standards Board (ISSB) and intend to move towards compliance when appropriate.

Outlook

Looking ahead, while we remain mindful of the external headwinds and market volatility, we are confident in the resilience of our business model. The Group entered 2025 with a strong balance sheet, a healthy pipeline of opportunities and continued focus on value creation for all stakeholders. The acquisition of EMC Elite Engineering in March 2025 illustrates the availability of suitable attractive acquisition targets of the Group.

I would like to thank the finance team and colleagues across the Group for their continued dedication and contribution throughout the year.

Siobhán Tyrrell

Chief Financial Officer

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 December 2024

There is no other comprehensive income in the period ended 31 December 2024 (2023: Nil). All results are from continuing operations.

The accompanying notes form an integral part of these consolidated financial statements.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 December 2024

The financial statements were approved and authorised for issue by the board of directors on 19 May 2025 and were signed on its behalf by:

Hugh Whitcomb

Director

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 31 December 2024

CONSOLIDATED STATEMENT OF CASHFLOWS

For the year ended 31 December 2024

NOTES TO THE GROUP FINANCIAL STATEMENTS

For the year ended 31 December 2024

1. General information

Amcomri Group plc is the ultimate parent company of the "Buy, Improve, Build" UK focused specialist engineering services and industrial manufacturing group of companies. Amcomri Group plc is incorporated and domiciled in the UK and its registered office is 46/48 Beak Street, London, W1F 9RJ.

On 20 November 2024, Amcomri Group plc was re-registered from a private limited company to a public limited company. Subsequently, on 20 December 2024 the Group announced the admission of its entire issued ordinary share capital to trading on the AIM Market of the London Stock Exchange.

2. Material accounting policy information

2.1 Basis of preparation

The Group's consolidated financial statements have been prepared on a going concern basis and under the historical cost convention.

Being quoted on the AIM Market of the London Stock Exchange, the Company has prepared its consolidated financial statements in accordance with UK-adopted international accounting standards ("IAS") and those parts of the Companies Act 2006 that apply to companies reporting under UK-adopted IAS. Accordingly, these financial statements have been prepared in accordance with the accounting policies set out below which are based on the aforementioned UK-adopted IAS and in effect at 31 December 2024. The accounting policies have been consistently applied unless otherwise stated.

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.

The preparation of financial statements in conformity with UK-adopted IAS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group's accounting policies. Details of the key estimates and judgements in these financial statements have been detailed in note 3.

2.2 Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full. Amounts reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Group.

Profit or loss and other comprehensive income of subsidiaries acquired during the year are recognised from the effective date of acquisition, as applicable. Subsidiaries are all entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. In assessing control, the Group takes into consideration potential voting rights. The acquisition date is the date on which control is transferred to the acquirer. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

The Group attributes total comprehensive income or loss of subsidiaries between the owners of the parent and the non‑controlling interests based on their respective ownership interests.

Transactions eliminated on consolidation

Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated. Unrealised gains arising from transactions with equity-accounted investees are eliminated against the investment to the extent of the Group's interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

2.3 Adopted IFRS not yet applied

New accounting standards, amendments and interpretations

The accounting policies that follow are consistent with those of the previous period, with the exception of the following standards, amendments and interpretations which are effective for the year ended 31 December 2024:

• Classification of Liabilities as Current or Non-current liabilities with covenants - Amendments to IAS 1;

• Lease Liability in Sale and Leaseback - Amendments to IFRS 16; and

• Supplier Finance Arrangements - Amendments to IAS 7 and IFRS 7.

The amendments listed above are not considered to have a material impact on the Consolidated Financial Statements of the Group.

The following new accounting standards and interpretations have been published but are not mandatory for 31 December 2024:

• IFRS 18 Presentation and disclosure in the financial statements;

• Amendments to IAS 21 - Lack of exchangeability; and

• Amendments to IFRS 9 and IFRS 7 - Amendments to the classification and measurement of financial instruments.

These amendments have not been early adopted by the Group. The impact assessment is ongoing, however it is expected that IFRS 18 will have a significant impact on the presentation of the financial statements. The new accounting standard does not impact the recognition and measurement of the financial statements, however, it will significantly alter the income statement and related disclosures. The Group is currently considering the requirements of the new standard and the implications for the financial statements. The initial view is that the following areas may be impacted.

• The line items presented in the income statement may change as a result of revised aggregation and disaggregation of information. This will also impact the disclosures in related notes.

• The presentation of the income statement, including the allocation of results from our joint venture.

• There will also be significant new disclosures for Management Performance Measures (MPM) and a breakdown of the nature of expenses for line items presented in the income statement. This disclosure will be dependent on the method of disclosure in the income statement.

• For the first annual period of application of IFRS 18 a reconciliation will be provided between the amounts previously presented under IAS 1 and the revised presentation under IFRS 18.

• Goodwill will be disaggregated from intangible assets on the face of the Balance Sheet.

From initial review, the amendments to IAS 21, IFRS 9 and IFRS 7 are not expected to have a material impact on the Group in the current or future reporting periods.

2.4 Going concern

The directors, have a reasonable expectation that the Group has adequate resources to continue operating as a going concern for the foreseeable future.

Having considered the Group's and the Company cash flow forecasts, current and anticipated trading volumes, together with current and anticipated levels of cash, debt and the availability of committed borrowing facilities, the directors are satisfied that the Group and the Company have sufficient resources to continue in operation for the foreseeable future, a period of at least 12 months from the date of signing of these financial statements, and accordingly, they continue to adopt the going concern basis in preparing the Group and Company financial statements.

In reviewing the appropriateness of the going concern assumption, management have prepared forecasts covering the going concern period, being a period of at least 12 months from the approval of these financial statements. In making this assessment, the directors' have considered a reasonable basis of sensitivity incorporating a plausible downside scenario and the impact that this may have on the projections for the Group and the Company in the going concern period. The Directors' are satisfied that the Company and Group have adequate cash resources available to meet the obligations of the Group and the Company as they fall due in the going concern period.

2.5 Business combinations

The Group applies the acquisition method in accounting for business combinations. The consideration transferred by the Group to obtain control of a subsidiary is calculated as the sum of the acquisition-date fair values of assets transferred, liabilities incurred, and the equity interests issued by the Group, which includes the fair value of any asset or liability arising from a contingent consideration arrangement. Acquisition costs are expensed as incurred.

Consideration transferred as part of a business combination does not include amounts related to the settlement of pre‑existing relationships. The gain or loss on the settlement of any pre-existing relationship is recognised in profit or loss.

Assets acquired and liabilities assumed are measured at their acquisition date fair values.

2.6 Functional and presentation currency

These financial statements are presented in pound sterling, which is the Group's functional currency. All amounts have been rounded to the nearest thousand, unless otherwise indicated.

2.7 Revenue

Revenue arises mainly from the sale of goods and servicing income.

To determine whether to recognise revenue, the Group follows the below process:

• Identifying the contract with a customer

• Identifying the performance obligations

• Determining the transaction price

• Allocating the transaction price to the performance obligations, and then

• Recognising revenue when/as performance obligation(s) are satisfied.

The Group often enters into customer contracts to supply a bundle of products and services. The contract is then assessed to determine whether it contains a single combined performance obligation or multiple performance obligations. If applicable the total transaction price is allocated amongst the various performance obligations based on their relative stand-alone selling prices. The transaction price for a contract excludes any amounts collected on behalf of third parties.

Revenue is recognised either at a point in time or over time, when (or as) the Group satisfies performance obligations by transferring the promised goods or services to its customers.

The Group recognises contract liabilities for consideration received in respect of unsatisfied performance obligations and reports these amounts as other liabilities in its consolidated statement of financial position. Similarly, if the Group satisfies a performance obligation before it receives the consideration, the Group recognises either a contract asset or a receivable in its consolidated statement of financial position, depending on whether something other than the passage of time is required before the consideration is due.

Sale of goods

Revenue from the sale of goods is recognised at the point in time when the customer obtains control of the goods which is based on the delivery terms of the contract. Revenue is recognised over time using the input method in case of longer term contracts or where the performance obligation is satisfied over time.

Rendering of services

Turnover from a contract to provide services is recognised in line with the performance obligations specified in the customer contract. Revenue is recognised as follows:

• where a contractual right to receive payment exists, revenue is recognised over the period services are provided using the percentage of completion method, based on the input method using time spent; and

• where no contractual right to receive payment exists, revenue is recognised upon completion of each separate obligation, which is typically when services are complete.

Segmental reporting

The Group's activities are predominantly in specialist maintenance, overhaul and services to safety critical energy, process and rail markets, and production equipment and printing services to the electronic and electrical markets. The Group operates two main operating segments: Embedded engineering and B2B manufacturing.

Operating segments are reported in a manner consistent with internal reporting provided to the Directors, who are responsible for allocating and assessing performance of the operating segments.

2.8 Finance income and expense

Interest income is recognised as profit or loss using the effective interest method.

Borrowing costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

2.9 Other income

Other income is the gain recognised on acquisition in the year where the consideration paid is less than the fair value of net assets acquired.

2.10 Operating costs

Operating expenses are recognised as profit or loss upon utilisation of the service or as incurred. Operating costs include amounts presented as cost of sales, distribution costs and administrative expenses.

2.11 Exceptional items

Exceptional items are disclosed separately in the statement of profit and loss where it is necessary to do so to provide further understanding of the financial performance of the Group. Exceptional items are items of one-off income or expense that have been shown separately due to the significance of their nature or amount. Exceptional items include professional fees related to the Group's admission to the AIM Market of the London Stock Exchange, see note 10.

2.12 Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company and the group operate and generate income.

Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for:

• the initial recognition of assets or liabilities that affect neither accounting nor taxable profit other than in a business combination; and

• differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future.

The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date. Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

2.13 Intangible assets

Goodwill

Goodwill represents the future economic benefits arising from a business combination that are not individually identified and separately recognised. Goodwill is carried at cost less accumulated impairment losses.

For the purposes of impairment testing, goodwill acquired in a business combination is allocated to each of the cash generating units ("CGU's") that is expected to benefit from the synergies of the combination. Assets are grouped at the lowest level for which there are largely independent cash inflows. Goodwill impairment reviews are undertaken annually. The carrying value of goodwill is compared to the recoverable amount, which is the higher of value in use and the fair value less costs of disposal. Any impairment is recognised immediately as an expense and is not subsequently reversed.

Gains on bargain purchase are recognised in the consolidated comprehensive income in the period to which it relates in full.

Customer relationships

Separately acquired customer relationships are accounted for at historic cost. Customer relationships acquired in a business combination are recognised at fair value at the acquisition date. Customer relationships have a finite useful life and are carried at cost less accumulated amortisation. Amortisation is calculated using the straight line method to allocate the cost of customer relationships over their estimated useful lives of 20 years.

Computer software

Costs that are directly attributable to a project's development phase are recognised as intangible assets, provided they meet all of the following recognition requirements:

• the development costs can be measured reliably;

• the project is technically and commercially feasible;

• the Group intends to and has sufficient resources to complete the project;

• the Group has the ability to use or sell the software; and

• the software will generate probable future economic benefits.

Computer software is amortised over a period of 5 - 10 years.

2.14 Tangible fixed assets

Property, plant and equipment are stated at cost net of accumulated depreciation and impairment losses. Costs include the original purchase price of the assets and the costs attributable to bringing the assets to their working condition for intended use.

Depreciation is recognised on a straight-line basis to write down the cost less estimated residual value of buildings, IT equipment and other equipment. The following useful lives are applied:

Gains or losses arising on the disposal of property, plant and equipment are determined as the difference between the disposal proceeds and the carrying amount of the assets and are recognised in profit or loss either within other income or other expenses.

2.15 Inventories

Inventories are stated at the lower of cost and net realisable value. Cost includes all expenses directly attributable to the manufacturing process as well as suitable portions of related production overheads, based on normal operating capacity. Costs of ordinarily interchangeable items are assigned using the first in, first out cost formula. Net realisable value is the estimated selling price in the ordinary course of business less any directly attributable selling expenses.

2.16 Trade receivables

Trade receivables are amounts due from customers for goods sold or services rendered in the ordinary course of business. If collection is expected within one year, they are classified as current assets. If not, they are classified as non-current assets. Trade receivables are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provisions for impairment. The Group assesses impairment based on the lifetime of credit loss.

2.17 Trade payables

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year. If not, they are presented as non current liabilities. Trade payables are recognised initially at the transaction price and subsequently recognised at amortised cost using the effective interest method.

2.18 Leases

Group as a lessee

The Group makes the use of leasing arrangements principally for the provision of the manufacturing facilities, warehouses and related facilities, and IT equipment and motor vehicles. The rental contracts for property are typically negotiated for terms of between 3 and 50 years and some of these have extension terms. Lease terms for fixtures & fittings and equipment and motor vehicles have lease terms of between 6 months and 10 years without any extension terms. The Group does not enter into sale and leaseback arrangements. All the leases are negotiated on an individual basis and contain a wide variety of different terms and conditions such as purchase options and escalation clauses.

The Group assesses whether a contract is or contains a lease at inception of the contract. A lease conveys the right to direct the use and obtain substantially all of the economic benefits of an identified asset for a period of time in exchange for consideration.

At lease commencement date, the Group recognises a right-of-use asset and a lease liability in its Consolidated Statement of Financial Position. The right-of-use asset is measured at cost, which is made up of the initial measurement of the lease liability, any initial direct costs incurred by the Group, an estimate of any costs to dismantle and remove the asset at the end of the lease, and any lease payments made in advance of the lease commencement date (net of any incentives received).

The Group depreciates the right-of-use asset on a straight-line basis from the lease commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The Group also assesses the right-of-use asset for impairment when such indicators exist.

At the commencement date, the Group measures the lease liability at the present value of the lease payments unpaid at that date discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the Company uses its incremental borrowing rate. The incremental borrowing rate is the estimated rate that the Group would have to pay to borrow the same amount over a similar term, and with similar security to obtain an asset of equivalent value. This rate is adjusted should the lessee entity have a different risk profile to that of the Group.

The lease liability is reassessed when there is a change in the lease payments. Changes in lease payments arise from a change in the lease term or a change in the assessment of an option to purchase a leased asset.

The Group has elected to account for short-term leases and leases of low-value assets using the practical expedients. These leases relate to items of office equipment such as desks, chairs, and certain IT equipment. Instead of recognising a right-of-use asset and lease liability, the payments in relation to these are recognised as an expense in profit or loss on a straight-line basis over the lease term.

2.19 Cash and cash equivalents

Cash and cash equivalents comprise of cash on hand and demand deposits, together with other short term, highly liquid investments maturing within 90 days from the date of acquisition that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value.

2.20 Provisions

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received, and the amount of the receivable can be measured reliably. The provisions are tested annually for impairment.

2.21 Financial instruments

Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions of the financial instrument. Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or when the financial asset and substantially all the risks and rewards are transferred. A financial liability is derecognised when it is extinguished, discharged, cancelled or expires.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in profit or loss.

Except for those trade receivables that do not contain a significant financing component and are measured at the transaction price in accordance with IFRS 15, all financial assets are initially measured at fair value adjusted for transaction costs (where applicable). Financial assets, other than those designated and effective as hedging instruments, are classified into one of the following categories:

• amortised cost

• fair value through profit or loss (FVTPL), or

• fair value through other comprehensive income (FVOCI).

In the periods presented the Group does not have any financial assets categorised as FVOCI.

All revenue and expenses relating to financial assets that are recognised in profit or loss are presented within finance costs, finance income or other financial items, except for impairment of trade receivables which is presented within other expenses.

IFRS 9's impairment requirements use forward-looking information to recognise expected credit losses - the 'expected credit loss (ECL) model'. Instruments within the scope of the requirements include loans and other debt-type financial assets measured at amortised cost and FVOCI, trade receivables, contract assets recognised and measured under IFRS 15 and loan commitments and some financial guarantee contracts (for the issuer) that are not measured at fair value through profit or loss.

The Group considers a broader range of information when assessing credit risk and measuring expected credit losses, including past events, current conditions, reasonable and supportable forecasts that affect the expected collectability of the future cash flows of the instrument.

Offsetting

Financial assets and liabilities are offset, and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis. The legally enforceable right must not be contingent on future events and must be in the normal course of business.

2.22 Impairment of non-financial assets

Assets that are subject to amortisation are reviewed for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds the recoverable amount. The recoverable amount is the higher of an asset's fair value less costs of disposal and value in use. In assessing the value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risk specific to the asset for which the estimate of future cash flows have not been adjusted. An impairment loss is recognised immediately in the profit and loss account, unless the relevant asset is carried at the revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase. A reversal of an impairment loss is recognised immediately in profit and loss, unless the relevant asset is carried at the revalued amount, in which case this reversal is taken to the revaluation reserve.

2.23 Dividends

Dividends are recognised when they become legally payable. In the case of interim dividends to equity shareholders, this is when declared by the directors. In the case of final dividends, this is when approved by the shareholders at a monthly board meeting.

2.24 Non-controlling interests

For business combinations, the Group initially recognised any non-controlling interest in the acquiree at the non‑controlling interest's proportionate share of the acquiree's net assets.

The total comprehensive income of non-wholly owned subsidiaries is attributed to owners of the parent and to the non-controlling interests in proportion to their relative ownership interests.

2.25 Post-employment benefits and short-term employment benefits

Post-employment benefit plans

The Group provides post-employment benefits through various defined contribution plans.

Defined contribution plans

The Group pays fixed contributions into independent entities in relation to several retirement plans and insurances for individual employees. The Group has no legal or constructive obligations to pay contributions in addition to its fixed contributions, which are recognised as an expense in the period that related employee services are received.

Short-term employee benefits

Short-term employee benefits, including holiday entitlement, are current liabilities included in pension and other employee obligations, measured at the undiscounted amount the Group expects to pay as a result of the unused entitlement.

2.26 Investments

Investments in subsidiaries are shown at cost less impairment losses. Investments are reviewed annually for impairment by comparing the carrying value of the investment to the higher of the subsidiary Group's value in use and fair value less costs to sell.

2.27 Borrowings

All borrowings are initially recorded at the amount of proceeds received, net of transaction costs. Borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge in the income statement over the period of the borrowing. Interest expense is recognised on the basis of the effective interest method and is included in finance costs. Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

2.28 Share capital and reserves

Ordinary share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing equity instruments. If payable is deferred and the time value of money is material, the initial measurement is on the present value basis.

Share premium reserve

The share premium reserve represents the agreed value of the shares issued above the nominal value. Any transaction costs associated with the issuing of shares are deducted from the share premium, net of any related income tax benefits.

Profit and loss reserve

The profit and loss reserves represent cumulative profit and loss reserves net of distributions to owners.

Retained earnings

Retained earnings includes all current and prior period retained profits.

Share based payments

The company's share-based payments are recognised as equity settled share-based payments as the employees will receive shares after the vesting period. Share-based compensation is recognised as an expense in the Consolidated Statement of Comprehensive Income with a corresponding credit to retained equity and reserves. If vesting periods or other vesting conditions apply, the expense is allocated over the vesting period, based on the best available estimate of the number of share options expected to vest. Non-market vesting conditions are included in assumptions about the number of share options that are expected to become exercisable. For equity settled shares, a fair value of the share option is established at the date the shares are granted, and the cost is spread over the vesting period.

Other reserves

Other reserves include a merger reserve which was created as a result of historic Group reorganisations.

2.29 Government grants

Grants from the government are recognised at their fair value where there is a reasonable assurance that the grant will be received, and the Group will comply with all attached conditions. Government grants relating to property, plant and equipment are included in current and non-current liabilities as deferred government grants and are credited to the profit or loss on a straight-line basis over the expected useful economic lives of the related assets.

3. Accounting estimates and judgements

In the application of the Group'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.

Estimates and the 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 it affects current and future periods.

There are no material judgements made in applying the accounting policies of the group.

Estimates made in applying the accounting policies of the group:

Revenue recognition - Group

For some of the Group's contracts with customers, estimates are required to assess whether control is transferred to customers over time or at a point in time, in accordance with IFRS 15. Where control over the specific performance obligations is transferred over time estimates are required regarding the progress towards completion. The Group measures certain contracts using the input method, measuring progress based on costs incurred relative to total expected costs. Contracts with specific performance obligations are measured using the output method, where progress is based on milestones or outputs achieved.

Business combinations - Group

Management uses various valuation techniques when determining the fair values of certain assets and liabilities acquired in a business combination. In particular, the fair value of contingent consideration is dependent on the outcome of many variables including the acquirees' future profitability. In making this assessment, management have used current performance, and projected future performance to determine whether a liability has arisen. Details of amounts recognised including the value of contingent consideration is disclosed in note 22.

Leases - determination of the appropriate discount rate to measure lease liabilities - Group

As noted above, the Group enters into leases with third-party landlords and as a consequence, the rate implicit in the relevant lease is not readily determinable. Therefore, the Group uses its incremental borrowing rate as the discount rate for determining its lease liabilities at the lease commencement date. The incremental borrowing rate is the rate of interest that the Group would have to pay to borrow over similar terms which requires estimations when no observable rates are available. The average discount rate used in the calculation of lease liabilities is 5%.

The Group consults with its main bankers to determine what interest rate they would expect to charge the Group to borrow money to purchase a similar asset to that which is being leased. Details on the amounts recognised as Right‑of‑use assets and Lease liabilities are disclosed in note 15.

Useful life of assets - Group

The annual depreciation charge depends primarily on the estimated lives of each type of asset. The Directors annually review these asset lives and adjust them as necessary to reflect the current thinking of remaining useful lives in light of technological change, prospective economic utilisation and physical condition of the assets concerned. Changes in asset lives can have a significant impact on depreciation charges for the period. There were no changes in the useful life of assets in the year, and no impairment adjustments recognised. The net value of depreciated assets together with the depreciation charge for the year is disclosed in note 14.

Provision in respect of trade and other debtors - Group

The company estimates the allowance for trade and other debtors based on an assessment of specific accounts where the company has objective evidence comprising default in payment terms of significant financial difficulty that certain customers are unable to meet their financial obligations. In these cases, judgement is used on the best available facts and circumstances including, but not limited to, length of relationship and historical events. The provision for specific bad debts for the year is disclosed in note 17.

Provision in respect of stock - Group

The company makes a number of estimates that are subjective in nature, in respect of provisions for inventory whose carrying value may not be realised. The Company uses a variety of sources to determine provision rates against specific stock categories, including historical sales patterns, post year end performance and age. Any change in these factors would impact the provision for stock and would result in a change in the carrying value. The stock provision has been disclosed in note 16.

Impairment of non-financial assets and goodwill - Group

The group tests at least annually, whether goodwill and other non-financial assets have suffered any impairment in accordance with its accounting policies. In assessing impairment, management estimates the recoverable amount of each asset or cash generating unit based on expected future cash flows and uses an interest rate to discount them (value in use). Estimating uncertainty relates to assumptions about future operating results and the determination of a suitable discount rate which can have a material impact on the respective valuations used for the impairment test. As at 31 December 2024, the Group did not identify any impairment indicators of goodwill.

Useful Life of other intangible assets - Customer Relationships - Group

The group estimates the useful life of other intangible assets - customer relationships, using certain financial and non‑financial information and historical trends. The useful like of customer relationships is 20 years. Further information on customer relationships is disclosed in note 13.

4. Revenue

The following is an analysis of the Group's revenue for the year from continuing operations:

Analysis of revenue by country of destination:

Of the revenue generated in the period £41.7m relates to revenue recognised at a point in time and £16.4m relates to revenue recognised over time (2023: £41.1m / £5.9m).

Total amount included in contract assets relating to revenue recognised but not invoiced was £415,000 (2023: £308,000).

Total amount included in contract liabilities relating to revenue invoiced but deferred was £1,355,000 (2023: £678,000).

5. Other operating income

Other operating income relates to items such as insurance claim receipts in the year.

6. Segmental reporting

Segment information for the reporting period is as follows:

Other items relate to the Group's head office costs. Other assets and liabilities include borrowings, intangible assets and goodwill raising on acquisitions, deferred tax and parent company assets.

No one customer accounts for more than 3% of revenue in 2024 or 2023.

Other items relate to the Group's head office costs. Other assets and liabilities include borrowings, intangible assets and goodwill raising on account acquisitions, deferred tax and parent company assets.

7. Employee costs

The average number of people employed by the Group (including directors) during the year was as follows:

The aggregate remuneration costs of these employees are presented below:

The remuneration costs of the Group's directors were:

Remuneration of the highest paid director was £259,375 pension £17,740 (2023: £110,500, pension £5,525).

Key management compensation

Key management personnel are considered to be the directors, being those persons having authority and responsibility for planning, directing and controlling the activities of the Group, both directly and indirectly. The total remuneration of key management and the directors of the Group combined was £2,355,587 (2023: £1,646,319).

8. Finance income

Finance income comprises of:

9. Finance expense

Finance expense comprises of:

10. Operating profit

Other operating expenses comprise of other administrative expenses such as rent & rates, utilities, insurance and other related administration expenses.

Operating exceptional items comprise:

The Group incurred costs of £1,815,000 of transaction costs and other IPO related costs as a result of the application made to the London Stock Exchange for all issued and to be issued ordinary share capital to be admitted to trading on AIM. £1,574,000 has been included within operating profit, and £241,000 has been offset against share premium in accordance with IAS 32 - financial instruments.

Auditors' remuneration for audit services during the year was:

11. Alternative performance measures

The Group's adjusted EBITDA is calculated after the following add backs:

12. Corporation tax

Amounts recognised in profit and loss

Factors affecting tax charge for the period

The tax assessed for the period is higher than the standard rate of corporation tax in the UK of 25% (2023: 23.52%). The differences are explained below:

Factors that may affect future tax charges

Deferred tax has been calculated at the rate at which the balances are expected to be settled, based on tax rates that have been substantively enacted at the balance sheet date, note 20.

13. Intangible assets

The useful life of these assets has been disclosed in note 2.13.

As described in note 3, the Group recognises goodwill and intangible assets arising on its acquisitions during the year. The determination of the fair value of assets and liabilities including goodwill arising on the acquisition of businesses and the acquisition of other intangible assets arising from the acquisition as part of business combinations which is expected to generate future economic benefits, are based to a considerable extent on management's judgement.

The useful life used to amortise intangible assets relates to the expected future performance of the assets acquired and management's estimate of the period over which economic benefit will be derived from the asset. The estimated useful life principally reflects management's view of the average economic life of each asset and is assessed by reference to historical data and future expectations. Any reduction in the estimated useful life would lead to an increase in the amortisation charge. If the average economic life was to decrease by 1 year the increase to the amortisation charge would be £19,645, if the economic life was to increase by 1 year the amortisation charge would decrease by £17,774 (2023: £12,390/ £11,210 respectively). The average economic life of customer relationships has been estimated at 17-20 years (2023: 18-20 years).

The fair values of customer relationships acquired through business combinations are based on the Multi-Period Excess Earnings Method ("MEEM") which is within the income approach. The multi-period excess earnings method estimated value is based on expected future earnings attributable to the agreements which have been discounted to a net present value using discount rates of between 7.3% and 10.8%, based on the Group's weighted average cost of capital. This is after returns are paid/charged to complementary assets which are used in conjunction with the valued asset to generate the earnings associated with it. The discount rates reflect appropriate adjustments relating to market risk and specific risk factors of each segment.

The goodwill rate of return is the return that causes the business enterprise value rate of return to equal the WACC. The implied rate of return on goodwill is based on the selected rates of return for each asset and the WACC is generally higher than any other asset as goodwill is the riskiest asset and should require the highest rate of return.

Management has undertaken sensitivity analysis on the base case financial model with a particular focus on, revenues and gross margins. The following scenarios have been prepared and the impact of each is outlined in the table below;

Management undertakes an annual test for impairment of indefinite life assets and, for finite life assets, to test for impairment if events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Group prepares and approves a detailed annual budget and long-term strategic plan for its operations, which are used as part of the impairment review. The value in use is calculated on the basis of projected cashflows for five years together with the terminal value at the end of the five years, which is computed by reference to projected year six cashflows and discounted. There was no requirement for any impairment provision at 31 December 2024 (2023: £nil). The key assumptions in determining the value in use are:

Revenue and margins: These are derived from the detailed 2025 budgets which are built up with reference to markets and product categories. Discount rate: Cashflows are discounted using WACC of 9.3% per annum (2023: 9.3%), calculated by reference to year‑end data on equity values and interest, dividend and tax rates.

Long-term growth rates: 3% long-term growth rate takes into account UK industry growth expectations.

14. Property, plant and equipment

Details of the Group's property, plant and equipment and their carrying amounts are as follows:

The useful life of the tangible assets has been disclosed in note 2.14.

15. Right of use assets

Lease liabilities are presented in the consolidated statement of financial position as follows:

The following amounts have been recognised in the profit and loss for which the Group is a lessee:

Amounts recognised in the statement of cashflows:

16. Inventories

Inventories consist of the following at year end:

Inventories have been stated after a provision of £589,770 (2023: £474,798). The increase in the inventory provision relates to slow moving inventory. The replacement value of inventory does not materially differ to the total balances by category.

17. Trade and other receivables

All amounts are short-term. The net carrying value of trade receivables is considered a reasonable approximation of fair value. The maximum exposure to customer credit risk at the reporting date is the currency value of trade receivables noted above. All trade and other receivables are in British pounds.

Trade receivables are stated after a provision for doubtful debts of £1,829 (2023: £7,679).

Other receivables include £544,500 of tax receivable which is deemed to have a low credit risk.

Age of trade receivables

No expected credit losses have been recognised relating to customers for whom there is no recent history of default and for which there are no other indications that they will not be able to meet their obligations. The Group applies IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables and contract assets. To measure the expected credit losses, receivables are grouped based on specific credit risk categories of the entities in which they operate. The expected loss rates are based on payment profiles of sales over a period of 24 months before 31 December 2024 and the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors expected to impact the customers to which they relate.

Other receivables includes £418,000 of contract assets (2023: £308,000). The following table shows the movement in contract assets.

18. Cash and cash equivalents

Cash and cash equivalents consist of the following:

Cash at bank earns interest at a floating rate based on daily bank deposit rates. Short-term deposits are made for varying periods of between one day and three months, depending on the requirements of the group. All amounts held at the bank are considered liquid as they are not restricted.

19. Trade and other payables

Trade and other payables consist of the following:

All amounts are short-term and are denominated in British pounds. The carrying value of trade payables and short‑term bank overdrafts are considered to be a reasonable approximation of fair value.

Deferred income consists of the following:

Contract liabilities and deferred service income represents customer payments received in advance of performances that are expected to be recognised as revenue in 2025.

The amounts recognised as deferred service income and contract liabilities for 2023 was recognised in revenue during 2024.

Arrangement fee income is deferred over the life of the loan typically a term of 3 years.

Deferred consideration can form a part of the acquisition price paid to sellers when Amcomri Group plc acquires a new company. It is an obligation to pay a certain amount at a specified date after the date of acquisition.

20. Borrowings

Borrowings include the following financial liabilities: