REG - Cindrigo Hldgs Ltd - Annual Financial Report
29/04/2026 18:30
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RNS Number : 4731C Cindrigo Holdings Limited 29 April 2026
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE UK
VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF ENGLISH
LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018, AS AMENDED. ON
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS
INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.
29 April 2026
Cindrigo Holdings Limited
("Cindrigo", the "Company" or the "Group")
Final Results
Cindrigo Holdings Limited (LSE: CINH), is pleased to announce its final
results for the year ended 31 December 2025. The audited annual financial
report for the year ended 31 December 2025 (the "Accounts") have been
approved, and extracts are presented below.
The Accounts are available in full on the Company's website at
www.cindrigo.com (http://www.cindrigo.com) and a copy will be submitted to the
National Storage Mechanism available for inspection at:
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism) .
Highlights
· Building a scalable and diversified sustainable energy platform.
· Post-period end £6.7 million equity investment committed to Cindrigo
at a price of 12 pence per share to support and strengthen the Group's
development, with commitments for additional funding.
· Additional €3 million committed by investor to the Joint Venture of
the sustainable biomass platform in Finland poised for commercialisation
following post-period and Joint Venture agreement, which integrates the heat
and power sales from the current energy plant, with biomass production and
sales, enabling multiple complementary revenue streams.
· Advancing three geothermal licences in the Upper Rhine Valley in
Germany, targeting a potential combined capacity of approximately 300 MW
across multiple sites.
· Significant market demand both biomass and geothermal, with strong
policy support across Europe.
· Admitted to the Official List of the FCA "Equity shares (commercial
companies)" segment and to trading on the Main Market of the London Stock
Exchange in October 2025.
· Awarded the London Stock Exchange Green Economy Mark.
· For the year ended 31 December 2025, the Group generated revenue of
£263k (2024: £85k) and recorded a loss for the year of £6,791k (2024:
£10,987k).
Lars Guldstrand, CEO of Cindrigo, commented: "Cindrigo is entering a new phase
of growth and development. We have recently secured commitment for funding
to expand our business in general and strategically build our Finnish biomass
operations via a Joint Venture agreement to develop Fuelwood, a sustainable
wood pellet business. Fuelwood has the potential to become one of Europe's
largest sustainable wood pellet production facilities, which will add
complementary revenue streams to our combined heat and power plant. Alongside
this, our German geothermal licences have significant potential, with a target
capacity of approximately 300 MW across district heating and electricity
generation, and additional potential from lithium extraction from geothermal
brine. We are excited for the future ahead as we build a scalable and
diversified sustainable energy platform."
To sign up for future news and updates from the Company please subscribe here:
https://www.cindrigo.com/mailing-list/
(https://www.cindrigo.com/mailing-list/)
For further information, please visit www.cindrigo.com
(http://www.cindrigo.com) , follow us on social media (LinkedIn and X) or
contact:
Cindrigo Holdings Limited
Lars Guldstrand, CEO LG@cindrigo.com (mailto:LG@cindrigo.com)
Tel: +44 (0) 740 886 1667
Beaumont Cornish Limited (Sponsor)
Roland Cornish /Asia Szusciak /Andrew Price Tel: +44 (0)207 628 3396
Capital Plus Partners Limited (Broker)
Jonathan Critchley Tel: +44 (0)207 432 0501
St Brides Partners (Financial PR)
Paul Dulieu / Charlotte Page cindrigo@stbridespartners.co.uk (mailto:cindrigo@stbridespartners.co.uk)
Beaumont Cornish Limited ("Beaumont Cornish") is the Company's Sponsor as
defined in the FCA UK Listing Rules and is authorised and regulated by the
FCA. Beaumont Cornish Limited is acting exclusively for the Company and for no
one else in relation to the matters described in this announcement and is not
advising any other person and accordingly will not be responsible to anyone
other than the Company for providing the protections afforded to clients of
Beaumont Cornish Limited, or for providing advice in relation to the contents
of this announcement or any matter referred to in it.
Forward Looking Statements
This announcement, including the Extracts from the Accounts, below, contains
forward looking statements that reflect the Company's current expectations,
intentions and projections regarding future events, operational developments,
financial performance and strategic progress. Forward looking statements are
identified by words such as "expects", "anticipates", "intends", "plans",
"believes", "targets", "may", "will", "could", "should" and similar
expressions.
These statements are based on a number of assumptions regarding the Group's
present and future business strategies, the environment in which the Group
operates, and the availability of funding and regulatory support. Forward
looking statements involve known and unknown risks, uncertainties and other
factors-many of which are beyond the control of the Group-that may cause
actual results, performance or achievements to differ materially from those
expressed or implied by such statements.
Such factors include, but are not limited to, project development timelines,
operational performance, regulatory approvals, market conditions, financing
availability, commodity prices, construction and commissioning risks, and
broader economic conditions.
Nothing in this statement should be construed as a profit forecast or profit
estimate. Forward looking statements speak only as at the date of this Annual
Report. Except as required by applicable law, the FCA Listing Rules or the UK
Market Abuse Regulation, the Group undertakes no obligation to update or
revise any forward looking statements, whether as a result of new information,
future events or otherwise.
Extracts from the Accounts
Chairman's Statement
I am pleased to present Cindrigo's Annual Report and Consolidated Financial
Statements for the year ended 31 December 2025, our first as a listed company
following admission to the Commercial Segment of the Main Market of the London
Stock Exchange on 31 October 2025. Cindrigo was founded with the goal of
delivering consistent, 24/7 energy by developing sustainable energy assets in
Europe. The need for secure, affordable and sustainable energy is arguably
more urgent than ever. Recent geopolitical activity has highlighted the
importance of energy security and alongside this, increasing electrification,
population growth, and the transition to lower-carbon energy systems are
exacerbating demand. Recognising this significant demand, Cindrigo is building
a diversified portfolio of sustainable energy assets, utilising proven
technology and expertise to take a leading role in the evolving European
energy market.
Finland - biomass
In Finland, the Group entered into a long-term lease arrangement in April
2024, covering a 110 MW biomass combined heat and power ("CHP") plant and
associated biomass handling facilities, for Kaipolan Energia Oy ("Kaipola").
During the year, the Board undertook a strategic review, which concluded that
an integrated biomass model - combining upstream biomass production with
downstream heat and power generation - would provide a more resilient and
scalable platform.
Following this review, and as announced on 29 April 2026, the Company has
identified a strategic opportunity to expand its biomass platform by
vertically integrating its energy business with a sustainable wood pellet
business, through a Joint venture agreement. Fuelwood is expected to become
the primary customer for energy from the plant, enabling the production and
sale of wood pellets alongside energy generation. Cindrigo, via Kaipola, is
also providing support to Fuelwood under a Management Services Agreement,
which is expected to generate approximately €1 million of revenue in 2026.
As part of this joint venture, and to support the Company's expansion,
Cindrigo has entered into binding agreements with a strategic investor group
(the "Investors") covering a total of just over £11 million in investments
and guarantees. Under the terms of the agreement the Investors will provide
approximately £6.7 million in equity funding for Cindrigo at a price of 12
pence per share and contribute a further €3 million into Fuelwood. Cindrigo
will also provide a €1 million development loan to Fuelwood.
In addition, the Investors have also committed up to £2 million under a
separate subscription arrangement, which will be drawn if the Company's
warrants, exercisable up until 31 July 2026, are not exercised. The same
Investor also has the right to subscribe for a further £2 million under a
separate investment arrangement.
This funding and joint venture agreement marks a major milestone for our
Company and we are now poised for commercial growth. Through this integrated
model, Cindrigo will combine heat and power generation with biomass production
and sales, enabling multiple complementary revenue streams, including heat,
power, pellet sales and management services, while achieving operational, cost
and commercial synergies
Fuelwood is targeting an initial production capacity of approximately 80,000
tonnes per annum, with commissioning now expected by the end of 2026 following
delays in funding timelines, and a long-term target of approximately 400,000
tonnes per annum. At current market prices of approximately €240 per tonne,
this could represents a potential annual revenue of up to approximately €100
million at full capacity. While these targets remain subject to successful
project delivery, we are committed to establishing Fuelwood as one of Europe's
largest sustainable wood pellet production facilities. Our focus is now on
execution, and while the timing of full operations at Kaipola has been delayed
from earlier expectations, primarily due to funding and off-take arrangements,
the integrated approach is expected to enhance overall asset utilisation and
support long-term value creation.
Germany - geothermal
In Germany, the geothermal development continues to progress on the Group's
three geothermal licences located in the Upper Rhine Valley, a
well-established geothermal production region. The Weinheim, Worms and Eich
licences collectively cover approximately 125 km² and have an eventual target
capacity of approximately 300 MW across district heating and electricity
generation, with additional potential from lithium extraction from geothermal
brine. Geothermal energy provides reliable baseload renewable power and
remains a core component of the Group's long-term strategy.
During the year, all three licences were extended, finalising the Group's 85%
interest in the initial projects. Development continues on a phased basis,
supported by technical work, permitting activities and engagement with funding
partners.
The German regulatory environment remains supportive, with government-backed
programmes, including KfW and associated insurance frameworks, designed to
mitigate drilling risk and support geothermal development.
Corporate
A key achievement during the year was the Company's admission to the Official
List of the FCA and to trading on the Main Market of the London Stock
Exchange. This milestone provides a strong platform to broaden the Company's
investor base and support future capital raising.
The Company was also awarded the London Stock Exchange Green Economy Mark,
recognising that a significant proportion of its activities contribute to the
global green economy.
Financial Review
For the year ended 31 December 2025, the Group generated revenue of £263k
(2024: £85k) and recorded a loss for the year of £6,791k (2024: £10,987k).
The improvement in the loss position primarily reflects lower finance costs
and the absence of impairment charges in the current year.
Total assets increased to £24,179k (2024: £21,550k), driven mainly by
capitalised development expenditure and an increase in current assets.
Outlook
Looking ahead, I believe Cindrigo is well positioned for growth. The Group
benefits from:
· an operationally aligned integrated biomass platform in Finland
· a strategic joint venture structure supporting scale and execution
· a progressing geothermal portfolio in Germany
· strong policy support across Europe for baseload renewable energy
A successful securing of funding and establishment of the Fuelwood joint
venture represent a significant step forward, enabling the transition from
development to execution across the Group's biomass operations.
The Board is now focused on disciplined delivery of this strategy, progressing
commissioning and production in Finland and advancing the geothermal portfolio
in Germany, with the objective of building a scalable and diversified
sustainable energy platform.
Jörgen Andersson
Chairman
Date: 28 April 2026
Financial Statements
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2025
2025 2024
Notes £'000 £'000
(Restated)
Revenue 7 263 85
Other incomes 8 99 -
Costs of material (8) (5)
Administrative expenses 9 (3,096) (4,833)
Depreciation, amortisation and impairment (229) (93)
Fair value Gains/(losses) 10 (2,856) -
Impairment of financial assets 11 (107) 25
Impairment of non-financial assets 11 - (4,447)
Loss on loss of control of subsidiary 11 - (1,066)
Operating loss (5,934) (10,334)
Finance Income 24 40 -
Finance costs 24 (956) (1,123)
Loss before income taxes (6,850) (11,457)
Income tax expense 28 (5) (3)
Loss for the year from continuing operations (6,855) (11,460)
Share of loss attributable to non-controlling interest 64 473
Loss for the year (6,791) (10,987)
Loss per share:
Basic from continuing operations 29 (0.026) (0.072)
Diluted from continuing operations 29 (0.026) (0.072)
OTHER COMPREHENSIVE INCOME:
Items that will be reclassified subsequently to profit or loss
Exchange differences on translating foreign operations, including goodwill 371 (9)
Total comprehensive loss for the year (6,420) (10,996)
All items in the above statement are from continuing operations.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December 2025
31 Dec 2025 31 Dec 2024
Notes £'000 £'000
Assets
Non-current assets
Property, plant and equipment 12 2,010 688
Right-of-use assets 13 4,492 4,378
Goodwill 14 15,909 15,533
Exploration and evaluation assets 15 223 -
Derivative asset 6 - -
Long term deposits 9 -
Total non-current assets 22,643 20,599
Current assets
Cash and cash equivalents 18 706 375
Inventories 19 182 163
Trade and other receivables 20 648 413
Total current assets 1,536 951
Total assets 24,179 21,550
Equity and liabilities
Capital and reserves
Share capital account 16 48,714 38,360
Share subscription reserve 16 43 1,356
Equity component of convertible instruments 21 1,942 3,700
Share option reserve 26 641 674
Share warrant reserve 17 893 -
Retained deficit (47,927) (41,136)
Foreign currency translation reserve (FCTR) 363 (9)
Equity attributable to owners of the parent 4,669 2,945
Non-controlling Interests 1,468 1,532
Total equity 6,137 4,477
Non - current liabilities
Borrowings 21 9,352 10,590
Lease liabilities 13 4,751 4,551
Financial liabilities - contingent consideration 22 2,792 -
16,895 15,141
Current liabilities
Lease liabilities 13 16 14
Borrowings 21 - 390
Trade and other payables 25 1,126 1,525
Tax liabilities 28 5 3
1,147 1,932
Total liabilities 18,042 17,073
Total equity and liabilities 24,179 21,550
The Consolidated Financial Statements were approved and authorised for issue
by the Board of Directors on 27 April 2026 and signed on its behalf by Jorgen
Andersson, Director and Lars Guldstrand, Director.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2025
Share Share subscription reserve Equity component of convertible instruments Share option reserve Share warrant reserve Retained deficit FCTR Non-controlling interest Total
capital account
Notes
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
As at 1 January 2025 38,360 1,356 3,700 674 - (41,136) (9) 1,532 4,477
Loss for the year (6,791) (64) (6,855)
Share capital raise 3,608 21 3,629
Transaction cost 16 (203) (203)
Allocation of reserve to share capital 16 1,334 (1,334) -
Share-based payment charge 26 (33) (33)
F/X difference on goodwill 14 376 376
F/X difference on foreign operations (4) (4)
Convertible loan notes settled 16 6,508 - (1,758) 4,750
Proceeds allocated to warrants 17 (893) 893 -
Balance at 31 December 2025 48,714 43 1,942 641 893 (47,927) 363 1,468 6,137
Share Share subscription reserve Equity component of convertible instruments Share option reserve Share warrant reserve Retained deficit FCTR Non-controlling interest Total
capital account
Notes
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
As at 1 January 2024 22,583 15 2,381 - - (29,928) - 36 (4,913)
Loss for the year (10,987) (473) (11,460)
Open offer share capital raise 16 15,777 1,341 17,118
Share-based payment charge 26 674 674
Equity Interest transferred to lender 1,553 1,553
(10% of Subsidiary)
Liquidation of subsidiary 416 416
F/X difference on currency translation (9) (9)
Equity component of convertible notes 1,098 1,098
Restructuring of loan notes 221 (221) -
Balance at 31 December 2024 38,360 1,356 3,700 674 - (41,136) (9) 1,532 4,477
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2025
2025 2024
Notes £'000 £'000
Cash from operating activities
Loss for the period before taxation (6,850) (11,457)
Non-cash adjustments 30 3,900 9,656
Operating cash flows before movements in working capital (2,950) (1,801)
Increase in inventories (19) (163)
(Increase)/decrease in receivables (244) 630
Increase/(decrease) in accounts payable and accrued liabilities 687 (39)
Income tax paid (3) -
Net cash used in operating activities (2,529) (1,373)
Purchase of property, plant and equipment 12 (1,460) (3,622)
Additions to exploration and evaluation assets 15 (223) -
Payment of deferred consideration 25 (867) (1,117)
Investment agreement - purchase of call option 6 (64) -
Net cash outflow from investing activities (2,614) (4,739)
Proceeds from issue of shares 16 3,628 2,438
Proceeds from borrowings / convertible instruments 23 2,500 4,012
Lease principal repayments 23 (65) -
Loan repayments 23 (77) (65)
Transaction cost 16 (203) (70)
Interest paid (302) -
Net cash inflow from financing activities 5,481 6,315
Effect of exchange rate changes on cash (7) -
Net increase in cash and cash equivalents 331 203
Cash and cash equivalent at beginning of period 375 172
Cash and cash equivalent at end of period 706 375
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. GENERAL INFORMATION
Cindrigo Holdings Limited and its subsidiaries (together, the "Group") are
engaged in the development and operation of renewable energy projects,
focusing on biomass and geothermal heat and power generation.
The Group's strategy is to be an active renewable energy developer,
coordinating project owner with outsourced construction and operation
supported by world class partners, both sub and on- surface. Development is
based on proven technology with a modular, replicable expansion.
The Company was incorporated on 24 November 2014, under Section II of the
Companies (Guernsey) Law, 2008, as a Company limited by shares. It is
registered in Guernsey under Company number 59383.
The Company's ordinary shares are listed on the Equity Shares (Commercial
Companies) sector of the Main Market of the London Stock Exchange with
admission occurring on 31 October 2025.
2. MATERIAL ACCOUNTING POLICIES
2.1 Basis of preparation
The consolidated financial statements of the Group have been prepared in
accordance with IFRS Accounting Standards as adopted by the European Union
("EU"). The Group's consolidated financial statements have been prepared on an
accrual basis and under the historical cost convention, other than derivative
call options and financial liabilities arising in relation to contingent
consideration arrangement, which are measured at fair value. They have been
prepared under the assumption the Group is a going concern, which assumes the
Group will be able to discharge its liabilities as they fall due at least for
a period of 12 months post balance sheet date.
The preparation of the consolidated financial statements in accordance with
IFRS Accounting Standards as adopted by the EU requires management to make
certain critical accounting estimates and to apply judgement in selecting and
applying the Group's accounting policies. Areas involving a higher degree of
judgement or complexity, as well as areas where assumptions and estimates have
a significant impact on the consolidated financial statements, are disclosed
in Note 3.
The financial information has been presented in Pounds Sterling (£), being
the functional currency of the Group.
2.2 Basis of consolidation
The Group's financial statements consolidate those of the parent Company and
all of its subsidiaries at 31 December 2025. All subsidiaries have a reporting
date of 31 December.
All transactions and balances between the Group companies are eliminated on
consolidation, including unrealised gains and losses on transactions between
Group companies. Where unrealised losses on intra-group asset sales are
reversed on consolidation, the underlying asset is also tested for impairment
from a Group perspective. 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 or
disposed of during the year are recognised from the effective date of
acquisition, or up to the effective date of disposal, as applicable.
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.
The following companies are consolidated into the Group financial statements:
Name of Company Country of incorporation Principal activity % Method of Consolidation
Owned
Cindrigo Ltd ("CL") UK Cost Center 100% Full Consolidation
Cindrigo Geothermal Limited ("CEGO UK") UK Holding Company 100% Full Consolidation
Kaipolan Energia Oy ("Kaipola") Finland Biomass 90% Full Consolidation
Zukunft Geoenergie GmbH ("ZGE") Germany Geothermal Energy 100% Full Consolidation
(Incorporated in 2025)
Zukunft Geoenergie 1 GmbH ("ZGE 1") Germany Geothermal Energy 100% Full Consolidation
(Incorporated in 2025)
Zukunft Geoenergie 2 GmbH ("ZGE 2") Germany Geothermal Energy 100% Full Consolidation
(Incorporated in 2025)
Zukunft Geoenergie 3 GmbH ("ZGE 3") Germany Geothermal Energy 100% Full Consolidation
(Incorporated in 2025)
Kaipola is a wholly owned subsidiary of the Group and represents a major
subsidiary undertaking for the purposes of UKLR 6.6.1. As at 31 December 2025,
Kaipola is not yet operational and remains in the development stage.
During the year, the entity generated limited revenue of £263k, primarily
from management fees and personnel leasing arrangements.
As at the reporting date, Kaipola had total assets of approximately £2,010k,
comprising primarily capitalised development expenditure. In addition,
goodwill of £15,909k and right-of-use assets of £4,492k are recognised in
the Group's consolidated balance sheet in respect of Kaipola. These balances
represent a significant proportion of the Group's total assets.
The development of the Kaipola project is subject to a number of risks,
including obtaining and maintaining the necessary permits, securing project
financing, and entering into key commercial agreements.
The subsidiary is currently funded through intercompany loans from the Group.
Additional funding will be required to progress the project to construction
and ultimately to operational status.
The following subsidiaries have not been audited as at 31 December 2025. The
UK subsidiary did not trade during the year. Four German subsidiaries were
incorporated during the current year and incurred only early-stage project
development expenditure. Management has used the latest available financial
information of these subsidiaries for consolidation. The directors consider
that any adjustments that may arise from an audit of these subsidiaries would
not be material to the Group's financial statements.
Name of Company Country of incorporation % Owned
Cindrigo Geothermal Limited ("CEGO UK") UK 100%
Zukunft Geoenergie GmbH ("ZGE") Germany 100%
Zukunft Geoenergie 1 GmbH ("ZGE 1") Germany 100%
Zukunft Geoenergie 2 GmbH ("ZGE 2") Germany 100%
Zukunft Geoenergie 3 GmbH ("ZGE 3") Germany 100%
Subsidiaries
Subsidiaries are entities controlled by the Group. Control exists 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. Subsidiaries are fully consolidated from the date on which
control is obtained and are deconsolidated from the date that control ceases.
The Group applies the acquisition method for business combinations.
Intercompany transactions, balances, and unrealised gains on transactions
between Group companies are eliminated on consolidation. Unrealised losses on
transactions between Group companies are also eliminated unless they provide
evidence of impairment.
Each subsidiary maintains its own accounting policies. Where necessary and
material, adjustments are made to align the accounting policies of
subsidiaries with those of the Group for consolidation purpose.
2.3 Going concern
The consolidated financial statements have been prepared on the assumption
that the Group will continue as a going concern. Under this assumption, the
Group is considered to be operating for the foreseeable future, with no
intention or requirement to liquidate, cease trading, or seek protection from
creditors under any applicable laws or regulations.
In evaluating the appropriateness of the going concern assumption, the
Directors have considered all relevant information available for the
foreseeable future, being a period of at least twelve months from the date of
approval of these consolidated financial statements, based on forecast cash
flows through April 2027.
The Directors' assessment of the Group's ability to continue as a going
concern involves significant judgement, particularly in relation to funding
availability, project execution timelines and the timing of future cash
inflows.
As at the date of approval of these consolidated financial statements, the
Group have secured funding commitments and guarantees in the amount of
approximately £11.3 million.
o £6.7 million equity investment into Cindrigo at a price of 12 pence per
share.
o €3 million been secured for the Fuelwood joint venture, this amount plus
a €1 million development loan from Cindrigo, a total of €4 million which
is sufficient to support Fuelwoods establishment and initial operational phase
o Up to £2 million under a separate subscription arrangement, which will be
drawn if the Company's warrants due for exercise at the end of July are not
exercised
No cash has been received in respect of these arrangements as of publishing of
the Annual Report, cash for the equity investment and Fuelwood is expected to
be received during May 2026, and any potential cash related to the Warrant
guarantee would be expected in August 2026.
As such, the timing of receipt of these funds is a key assumption underpinning
the Directors' assessment of the Group's ability to continue as a going
concern.
The Directors have prepared detailed cash flow forecasts through to April
2027, reflecting the Group's expected funding inflows, expected operating
costs and development plans. These forecasts indicate that the Group has
sufficient financial resources to meet its obligations as they fall due for at
least twelve months from the date of approval of these financial statements.
The Directors have also performed reverse stress testing on the cash flow
forecasts to assess the level of downside required to exhaust available
liquidity. This analysis incorporated severe but plausible assumptions,
including delays in the commencement of production at Kaipola, and the removal
of any proceeds from the exercise of warrants. Under this combined downside
scenario, the Group continues to maintain a positive cash position throughout
the going‑concern assessment period and is able to meet its obligations as
they fall due.
The Directors' objective in managing capital is to safeguard the Group's
ability to continue as a going concern in order to provide returns for
shareholders and benefits for other stakeholders. At the date of this
financial information, the Group has been financed through a combination of
equity and convertible notes. Going forward, the capital structure of the
Group is expected to consist of convertible notes and equity attributable to
equity holders of the Group, comprising issued share capital and reserves.
Based on the above assessment, the Board do not believe that there are any
material uncertainties that may cast significant doubt on the Group's ability
to continue as a going concern.
Accordingly, the Directors consider that the going concern basis of
preparation remains appropriate.
2.4 New or revised Standards or Interpretations
New standards, interpretations and amendments effective from 1 January 2025
The Group has applied the following new accounting standards and amendments
effective from 1 January 2025. These changes did not have a significant impact
on the consolidated financial statements for the reporting period.
Lack of Exchangeability (Amendments to IAS 21)
These amendments address currency translation issues when a currency cannot be
freely exchanged into another and introduces related disclosures.
Impact: The Group has reviewed this amendment and determined that it does not
have a material impact on the consolidated financial statements for the year
ended 31 December 2025. Disclosures are updated where applicable.
Standards, amendments and interpretations to existing Standards that are not
yet effective and have not been adopted early by the Group
At the date of authorisation of these consolidated financial statements,
several new, but not yet effective, Standards and amendments to existing
Standards, and Interpretations have been published by the IASB or IFRIC. None
of these Standards or amendments to existing Standards have been adopted early
by the Group and no Interpretations have been issued that are applicable and
need to be taken into consideration by the Group at either reporting date.
Management anticipates that all relevant pronouncements will be adopted for
the first period beginning on or after the effective date of the
pronouncement.
In April 2024, the IASB issued IFRS 18, which replaces IAS 1 'Presentation of
Financial Statements'. Although IFRS 18 includes many of the requirements of
IAS 1, it introduces new requirements to better structure financial statements
and to provide more detailed and useful information to investors, including:
· two new subtotals defined in the statement of profit or loss, namely
(1) operating profit and (2) profit or loss before financing and income taxes
· the classification of all income and expenses within the Statement of
profit or loss in one of five categories
· a new requirement to disclose performance measures defined by
management, and
· an improvement in the principles related to the aggregation and
disaggregation of information in the financial statements and accompanying
notes.
Some of the disclosure requirements previously contained in IAS 1 have been
transferred to IAS 8 without any material changes. This applies in particular
to disclosures on accounting policies and sources of estimation uncertainty.
As a result of these changes, IAS 8 will be renamed 'Basis of Preparation of
Financial Statements'.
The publication of IFRS 18 also results in consequential amendments to other
IFRS Accounting Standards, including IAS 7.
IFRS 18 is effective for annual periods beginning on or after 1 January 2027,
with earlier application permitted. IFRS 18 will be applied retrospectively
with specific transitional provisions.
The Group has not yet completed its assessment of the impact of IFRS 18. At
the reporting date, it is not practicable to provide a reasonable estimate of
the expected effects. The area's most likely to be affected include the
structure and subtotals in the statement of profit or loss and the disclosure
of management-defined performance measures.
Other new Standards, amendments and Interpretations not adopted in the current
year have not been disclosed as they are not expected to have a material
impact on the Group's consolidated financial statements.
2.5 Business Combinations
The acquisition method is used for all business combinations. The
consideration transferred for the acquisition of a subsidiary includes the
acquisition date fair values of:
· Assets transferred,
· Liabilities incurred,
· Equity interests issued by the Group, which includes the fair value
of any asset or liability arising from a contingent consideration arrangement,
· Pre-existing equity interests in the subsidiary.
Identifiable assets and liabilities acquired are generally measured at fair
value at the acquisition date. Non-controlling interests in the acquired
entity are recognised either at fair value or the proportionate share of net
identifiable assets, depending on the acquisition.
Acquisition-related costs are expensed as incurred.
The excess of consideration transferred and the fair value of any
non-controlling interest over the fair value of net identifiable assets
acquired is recognised as goodwill. If this excess is negative, the difference
is recognised as a bargain purchase in profit or loss.
Deferred cash consideration is discounted to its present value using the
Group's incremental borrowing rate.
Contingent consideration is classified as either equity or a financial
liability, with changes in fair value recognised in profit or loss only when
contingent consideration is classified as financial liability.
2.6 Segment Reporting
The Chief Operating Decision Maker ("CODM"), identified as the Board of
Directors, is responsible for allocating resources and assessing the
performance of the Group.
The CODM reviews financial and operational performance primarily on a
consolidated Group basis, including overall financial results, cash flow
projections, and funding requirements. Internal reporting to the CODM focuses
on the performance of the Group's integrated portfolio of energy-related
projects and does not include regularly reviewed discrete financial
information, such as profit or loss or other key performance measures, for
individual subsidiaries, projects, or geographical regions.
The Group's activities, including operational assets, development-stage
projects, and management service arrangements, are managed and evaluated as a
single integrated portfolio. Resource allocation decisions and performance
assessments are made based on overall portfolio returns and strategic
objectives rather than the performance of individual components.
Although the Group operates in multiple jurisdictions and at different stages
of the project lifecycle, and generates revenue from different sources,
including energy production and management services, these activities are not
separately monitored or managed as distinct operating segments by the CODM.
Accordingly, management has determined that the Group operates as a single
operating segment, being the identification, acquisition, development, and
operation of energy-related projects. No separate reportable segments have
been identified.
Segment information is therefore presented on the same basis as that used in
the preparation of the Group's consolidated financial statements.
Revenue is currently generated from external customers primarily through the
Group's Finnish subsidiary, Kaipolan Energia Oy, while other entities within
the Group are in development or holding phases. This concentration of revenue
does not result in separate operating segments, as it does not reflect the
basis on which the CODM assesses performance or allocates resources.
For impairment testing purposes, the Group has identified separate
cash-generating units ("CGUs") within the Group; however, these do not
represent operating segments, as they are not reviewed separately by the CODM
for performance assessment or resource allocation decisions.
At the reporting date, the Group's non-current assets are located in Guernsey,
the United Kingdom, Finland and Germany.
2.7 Foreign Currency Translation
Functional and presentation currency
The consolidated financial statements are presented in Pounds Sterling
("GBP"), which is also the functional currency of the parent company.
Foreign currency transactions and balances
Foreign currency transactions are translated into the functional currency of
the respective Group entity using the exchange rates prevailing at the dates
of the transactions (spot exchange rate). Foreign exchange gains and losses
resulting from the settlement of such transactions and from the remeasurement
of monetary items denominated in foreign currencies at the period-end exchange
rates are recognised in profit or loss.
Non-monetary items are not retranslated at the period-end. They are measured
at historical cost (translated using the exchange rates at the transaction
date), except for non-monetary items measured at fair value, which are
translated using the exchange rates at the date when the fair value was
determined.
Foreign operations
For the purposes of consolidation, the assets and liabilities of Group
entities with a functional currency other than GBP are translated into GBP at
the exchange rate prevailing at the reporting date. Income and expenses are
translated at the average exchange rate for the reporting period, unless
exchange rates fluctuate significantly, in which case the rate at the date of
the transaction is used. Goodwill and fair value adjustments arising on the
acquisition of a foreign entity are treated as assets and liabilities of the
foreign entity and translated into GBP at the closing exchange rate at the
reporting date.
Exchange differences arising from the translation of foreign operations are
recognised in other comprehensive income and accumulated in the foreign
currency translation reserve (FCTR) within equity. On disposal of a foreign
operation, the cumulative amount of such exchange differences recognised in
equity relating to that operation is reclassified to profit or loss and
recognised as part of the gain or loss on disposal.
2.8 Income recognition
Sale of energy
Revenue represents the fair value of the consideration received or receivable
for the sale of energy, including electricity and heat, in the ordinary course
of the Group's activities. The Group identifies its performance obligations as
the delivery of energy (electricity and heat) to customers. Each contract with
a customer comprises a single performance obligation, as the customer
simultaneously receives and consumes the benefits of the energy supplied.
The transaction price is determined based on the agreed contractual price for
the energy delivered. This price reflects the volume of energy supplied during
the reporting period, adjusted for any variable consideration where
applicable. Since each contract contains a single performance obligation-the
delivery of energy-the entire transaction price is allocated to this
performance obligation.
Revenue from the sale of energy is recognised over time, on the basis that the
customer simultaneously receives and consumes the benefits as the Group
performs by delivering energy. Revenue is recognised based on the volume of
energy delivered during the reporting period and the agreed price per unit.
Management fees
The Company charges management fees for operational support services provided
through its personnel strictly in accordance with agreed contractual terms.
Management fees are determined based on the nature and scope of services
provided and are disclosed in client agreements and relevant product
documentation. Fees are applied consistently in line with contractual
arrangements and are subject to periodic internal review. Revenue from
management services is recognised over time, as the services are performed, as
the customer simultaneously receives and consumes the benefits of the services
in accordance with IFRS 15.35(a), and measured based on the stage of
completion of the services (e.g. time elapsed or services performed). Invoices
are issued in accordance with contractual terms and do not determine the
timing of revenue recognition.
Interest income
Interest income is recognised using the effective interest method in
accordance with the terms of the intercompany loan agreements. If a financial
asset becomes credit-impaired, the Group recognises interest income on the net
carrying amount of the asset, applying the original effective interest rate
Other income
Other income comprises gains and receipts that are not part of the Group's
primary activities. It is recognised when it is probable that future economic
benefits will flow to the Group and the amount of income can be measured
reliably. Income is recognised on an accrual basis, irrespective of the timing
of cash receipts.
2.9 Goodwill
Goodwill is measured as described under "Business Combinations" in note 2.5.
Goodwill on acquisitions of subsidiaries is included in intangible assets.
Goodwill is not amortised but it is tested for impairment annually, or more
frequently if events or changes in circumstances indicate that it might be
impaired, and is carried at cost less accumulated impairment losses. Gains and
losses on the disposal of an entity include the carrying amount of goodwill
relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment
testing. The allocation is made to those cash-generating units or groups of
cash-generating units that are expected to benefit from the business
combination in which the goodwill arose. The units or groups of units are
identified at the lowest level at which goodwill is monitored for internal
management purposes.
The Group tests cash-generating units (CGUs) to which goodwill has been
allocated for impairment annually, or more frequently where indicators of
impairment exist. Goodwill is allocated to the Kaipola CGU (the "Plant"),
which represents the lowest level within the Group at which goodwill is
monitored for internal management purposes and is expected to benefit from the
synergies of the business combination.
2.10 Exploration and Evaluation Expenditure
Exploration and evaluation ("E&E") expenditure comprises costs incurred in
the search for geothermal and other energy resources prior to the
demonstration of technical feasibility and commercial viability.
In accordance with IFRS 6 Exploration for and Evaluation of Mineral Resources,
E&E expenditure is capitalised as an intangible asset on an
area-of-interest basis when the Group has the right to explore in a specific
area and it is expected that the costs will be recouped through successful
development or sale, or where exploration activities have not yet reached a
stage which permits a reasonable assessment of the existence of economically
recoverable resources. Costs incurred prior to obtaining legal rights to
explore are expensed as incurred.
Capitalised E&E costs include licence acquisition costs, geological and
geophysical studies, exploration drilling, sampling and directly attributable
employee and contractor costs.
Exploration and evaluation assets are initially recognised at cost, being the
aggregate of consideration transferred and directly attributable expenditures
incurred in obtaining and developing exploration rights.
E&E assets are measured at cost less accumulated impairment losses and are
not amortised while in the exploration and evaluation phase.
E&E assets are assessed for impairment when facts and circumstances
indicate that the carrying amount may exceed the recoverable amount. Such
indicators include the expiry of exploration rights, a lack of planned
substantive expenditure, or unsuccessful exploration results. Where indicators
exist, the Group performs an impairment test in accordance with IAS 36 and
recognises any impairment loss in statement of comprehensive income.
Upon demonstration of technical feasibility and commercial viability, E&E
assets are reclassified to development assets and subsequently accounted for
in accordance with the applicable standard.
The geothermal licence rights provide the Group with the legal right to
explore and evaluate geothermal energy resources within specified licence
areas, forming the basis for capitalisation of exploration and evaluation
expenditure.
E&E assets are derecognised when the rights to explore expire or when no
future economic benefits are expected.
2.11 Property, plant and equipment
Property, plant and equipment are stated at historical cost less depreciation.
Historical cost includes expenditure that is directly attributable to the
acquisition of the items. Subsequent costs are included in the asset's
carrying amount or recognised as a separate asset, as appropriate, only when
it is probable that future economic benefits associated with the item will
flow to the Group and the cost of the item can be measured reliably. The
carrying amount of any component accounted for as a separate asset is
derecognised when replaced. All other repairs and maintenance are charged to
profit or loss during the reporting period in which they are incurred.
After initial recognition, property, plant and equipment are measured using
the cost model and are carried at cost less accumulated depreciation and any
accumulated impairment losses.
Depreciation is recognised so as to write down the cost of assets to their
residual values over their estimated useful lives, reflecting the pattern in
which the assets' future economic benefits are expected to be consumed.
· Construction-related assets (e.g. assets under construction,
development and upgrade costs): carried at cost and not depreciated until
available for use. Once available for use, these assets are depreciated on a
straight-line basis over up to 10 years.
· Tangible assets (e.g. plant, machinery, furniture and movables):
written down value method at 25% per annum. The depreciation method reflects
the expected pattern of consumption of the assets' future economic benefits.
Residual values, useful lives and the depreciation method are reviewed at
least annually and adjusted prospectively where appropriate.
An asset's carrying amount is written down immediately to its recoverable
amount if the asset's carrying amount is greater than its estimated
recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with
carrying amount. These are included in profit or loss.
2.12 Leases
The Group accounts for leases in accordance with IFRS 16 Leases. At the
commencement date, the Group recognises a right-of-use asset and a
corresponding lease liability for all lease agreements, except for short-term
leases (with a lease term of 12 months or less) and leases of low-value
assets.
The Group assesses whether a contract contains a lease at inception. A lease
conveys the right to control the use of an identified asset for a period of
time in exchange for consideration.
The right-of-use asset is initially measured at cost, comprising the initial
lease liability, any initial direct costs, estimated dismantling or
restoration costs, and any lease payments made in advance (net of incentives
received). The right-of-use asset is depreciated on a straight-line basis over
the shorter of the asset's useful life or the lease term and is assessed for
impairment where indicators exist.
The lease liability is initially measured at the present value of lease
payments, discounted using the Group's incremental borrowing rate, as the
interest rate implicit in the lease is generally not readily determinable.
Lease payments included in the liability comprise fixed payments, variable
payments based on an index or rate, and amounts expected under residual value
guarantees.
Subsequent to initial recognition, lease payments reduce the liability and are
allocated between finance costs and principal repayment. The lease liability
is remeasured when lease payments change due to modifications, reassessment of
lease terms, options to purchase, or changes in payments linked to indices or
floating interest rates. Remeasurements adjust the carrying amount of the
right-of-use asset, except when the asset is fully written down, in which case
any excess is recognised in profit or loss.
Payments for short-term leases, low-value assets, and leases of assets under
construction are expensed on a straight-line basis and disclosed separately as
off-balance sheet commitments. As at 31 December 2025, the Group did not have
any short-term leases, low-value asset leases, or leases of assets under
construction, and accordingly no related expenses were recognised.
2.13 Impairment of Assets
Cash-generating units to which goodwill or intangible assets that have an
indefinite useful life or are not yet available for use have been allocated
are tested for impairment at least annually. All other individual assets or
cash-generating units are tested for impairment whenever events or changes in
circumstances indicate the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the asset's (or
cash-generating unit's) carrying amount exceeds its recoverable amount, which
is the higher of fair value less costs of disposal and value-in-use. To
determine the value-in-use, management estimates expected future cash flows
from each cash-generating unit and determines a suitable discount rate in
order to calculate the present value of those cash flows. The data used for
impairment testing procedures is directly linked to the Group's latest
approved budget, adjusted as necessary to exclude the effects of future
reorganisations and asset enhancements. Discount factors are determined
individually for each cash-generating unit and reflect current market
assessments of the time value of money and asset-specific risk factors.
Impairment losses for cash-generating units are first applied to reduce the
carrying amount of any goodwill allocated to the cash-generating unit. Any
remaining impairment loss is charged pro rata to the other assets in the
cash-generating unit.
With the exception of goodwill, all assets are subsequently reassessed for
indications that an impairment loss previously recognised may no longer exist.
An impairment loss is reversed if the asset's or cash-generating unit's
recoverable amount exceeds its carrying amount.
2.14 Financial instruments
Recognition and derecognition
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.
Classification and initial measurement of financial assets
Except for those trade and other 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 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.
The classification is determined by both:
· the Group's business model for managing the financial asset, and
· the contractual cash flow characteristics of the financial asset
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.
Subsequent measurement of financial assets
o Financial assets at amortised cost
Financial assets are measured at amortised cost if the assets meet the
following conditions:
· they are held within a business model whose objective is to hold the
financial assets and collect its contractual cash flows, and
· the contractual terms of the financial assets give rise to cash flows
that are solely payments of principal and interest on the principal amount
outstanding.
After initial recognition, these are measured at amortised cost using the
effective interest method. Discounting is omitted where the effect of
discounting is immaterial.
o Financial assets at fair value through profit or loss (FVTPL)
Financial assets are classified as FVTPL if they are:
· held for trading, or
· derivatives (unless designated and effective as hedging instruments)
Derivatives, including call options, are initially recognised at fair value on
the date the Group becomes a party to the contractual provisions of the
instrument and are subsequently remeasured at fair value at each reporting
date.
Gains or losses arising from changes in fair value are recognised immediately
in statement of profit or loss and presented within finance income or finance
costs.
Impairment of financial assets
IFRS 9's impairment requirements apply to financial assets measured at
amortised cost, including loans, trade receivables and contract assets
recognised under IFRS 15. The Group applies the expected credit loss (ECL)
model, which uses forward-looking information to recognise credit losses on
these financial assets.
For trade receivables and contract assets, the Group applies the simplified
approach permitted by IFRS 9, under which lifetime expected credit losses are
recognised from initial recognition.
For other financial instruments, the Group applies the general approach and
classifies financial assets into the following categories based on changes in
credit risk since initial recognition:
· Stage 1: Financial instruments that have not deteriorated
significantly in credit quality since initial recognition or that have low
credit risk.
· Stage 2: Financial instruments that have deteriorated significantly
in credit quality since initial recognition and whose credit risk is not low.
· Stage 3: Financial assets that have objective evidence of impairment
at the reporting date.
12-month expected credit losses are recognised for Stage 1 assets, while
lifetime expected credit losses are recognised for Stage 2 and Stage 3 assets.
A significant increase in credit risk is assessed by comparing the risk of
default at the reporting date with the risk of default at initial recognition,
taking into account reasonable and supportable forward-looking information.
Expected credit losses are measured as a probability-weighted estimate of
credit losses over the expected life of the financial instrument.
Financial assets are written off when there is no reasonable expectation of
recovery, either in full or in part.
Classification and measurement of financial liabilities
The Group's financial liabilities include borrowings and trade and other
payables, as well as certain financial liabilities in relation to contingent
consideration arrangements which are measured at fair value through profit or
loss (FVTPL).
Financial liabilities are initially measured at fair value, and, where
applicable, adjusted for directly attributable transaction costs. However,
transaction costs are expensed immediately for financial liabilities
classified at fair value through profit or loss.
Subsequently, financial liabilities are measured as follows:
· financial liabilities measured at amortised cost are subsequently
measured using the effective interest method; and
· financial liabilities measured at fair value through profit or loss
are remeasured at each reporting date with gains or losses recognised in
profit or loss.
All interest-related charges and, if applicable, changes in an instrument's
fair value that are reported in statement of comprehensive income are included
within finance costs or finance income, except for fair value movements on
financial liabilities at FVTPL, which are presented within finance income or
finance costs depending on their nature.
Financial liabilities are derecognised when the contractual obligations are
discharged, cancelled or expire. Where a financial liability is modified or
replaced, the Group assesses whether derecognition is appropriate in
accordance with IFRS 9, including whether the modification is substantial.
2.15 Cash and cash equivalents
For the purpose of presentation in the consolidated statement of cash flows,
cash and cash equivalents include cash on hand, deposits held at call with
financial institutions, other short-term, highly liquid investments with
original maturities of three months or less that are readily convertible to
known amounts of cash and which are subject to an insignificant risk of
changes in value.
2.16 Inventories
Inventories are initially measured at cost, which includes all costs of
purchase, costs of conversion, and other costs incurred in bringing the
inventories to their present location and condition.
Subsequently, 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 appropriate allocations of production overheads, based on
normal operating capacity. The cost of ordinarily interchangeable items is
determined using the first-in, first-out (FIFO) method. Net realisable value
is the estimated selling price in the ordinary course of business, less any
costs necessary to make the sale.
2.17 Trade and Other Receivables
Trade and Other Receivables are initially recognised at fair value including
transaction costs that are directly attributable to their acquisition. The
Group makes use of a simplified approach in accounting for trade and other
receivables as well as contract assets and records the loss allowance as
lifetime expected credit losses. These are the expected shortfalls in
contractual cash flows, considering the potential for default at any point
during the life of the financial instrument. In calculating, the Group uses
its historical experience, external indicators and forward-looking information
to calculate the expected credit losses using a provision matrix.
2.18 Income taxes
Income tax expense recognised in profit or loss comprises current tax and
deferred tax, except to the extent that it relates to items recognised in
other comprehensive income or directly in equity.
Current tax
Current tax is based on taxable profit for the year and is calculated using
tax rates and tax laws that have been enacted or substantively enacted at the
end of the reporting period.
The Group operates in multiple jurisdictions and, despite an overall loss
position, incurs minor current income tax charges.
Management applies judgement in assessing uncertain tax positions and
recognises current tax liabilities where it is probable that the taxation
authority will accept the tax treatment applied.
Deferred tax
Deferred tax is calculated using the liability method on temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and their tax bases.
Deferred tax assets are recognised to the extent it is probable that the
underlying tax loss or deductible temporary difference will be utilised
against future taxable income. This is assessed based on the Group's forecast
of future operating results, adjusted for significant non-taxable income and
expenses and specific limits on the use of any unused tax loss or credit.
The Group has incurred recurring tax losses and, at the reporting date, there
is no convincing evidence that sufficient taxable profits will be generated in
the foreseeable future. Accordingly:
No deferred tax assets have been recognised in respect of unused tax losses or
deductible temporary differences.
Deferred tax liabilities are generally recognised in full, although IAS 12
'Income Taxes' specifies limited exemptions. As a result of these exemptions
the Group does not recognise deferred tax on temporary differences relating to
goodwill, or to its investments in subsidiaries (only to the extent that the
Group control the timing of the reversal of the taxable temporary difference
and that reversal is not likely to occur in the foreseeable future). The Group
does not offset deferred tax assets and liabilities unless it has a legally
enforceable right to do so and intends to settle on a net basis.
2.19 Trade and other payables
These amounts represent liabilities for goods and services provided to the
Group prior to the end of financial year which are unpaid. The amounts are
unsecured and are usually paid within 30 days of recognition. Trade and other
payables are classified as current liabilities unless payment is not due
within 12 months after the reporting period. They are recognised initially at
their fair value and subsequently measured at amortised cost using the
effective interest method.
2.20 Borrowings
Borrowings are initially recognised at fair value, net of directly
attributable transaction costs. Subsequent measurement depends on the nature
of the borrowing instrument:
Non-convertible loans are subsequently measured at amortised cost using the
effective interest method. Any difference between the proceeds (net of
transaction costs) and the redemption amount is recognised in profit or loss
over the period of the loan. Fees paid on the establishment of loan facilities
are capitalised as part of the loan to the extent that it is probable that
some or all of the facility will be drawn down. Where there is no evidence of
probable drawdown, such fees are recognised as prepaid costs and amortised
over the term of the facility.
Convertible loans are assessed to determine whether they include an embedded
derivative or qualify for split accounting. Where the conversion terms are
variable and do not meet the "fixed- for-fixed" criterion, the entire
instrument is classified as a financial liability at fair value through profit
or loss (FVTPL), with changes in fair value recognised in profit or loss.
Where the conversion option meets the fixed-for-fixed requirement, the
instrument is split into a liability component (measured at amortised cost)
and an equity component (representing the conversion feature), with the
liability portion determined using a market interest rate for a comparable
non-convertible loan.
2.21 Employee benefits
Short term obligations
Liabilities for wages and salaries, including non-monetary benefits and
accumulating sick leave that are expected to be settled wholly within 12
months after the end of the period in which the employees render the related
service are recognised in respect of employees' services up to the end of the
reporting period and are measured at the amounts expected to be paid when the
liabilities are settled.
The obligations are presented as current liabilities in the statement of
financial position if the entity does not have an unconditional right to defer
settlement for at least twelve months after the reporting period, regardless
of when the actual settlement is expected to occur.
Share-based payments
The fair value of equity-settled share options granted to employees,
directors, and key management personnel is measured at the grant date in
accordance with IFRS 2 Share-based Payment. The fair value is determined using
an appropriate option pricing model, such as the Black-Scholes model, taking
into account the terms and conditions upon which the options were granted,
including that no market performance conditions are attached.
The fair value determined at the grant date is recognised as a share-based
payment expense in the statement of comprehensive income, with a corresponding
increase in equity, over the vesting period, being the period over which all
vesting conditions are to be satisfied.
The total amount to be expensed is determined by reference to the fair value
of the options granted:
· Includes: any market performance conditions (e.g., the entity's share
price);
· Excludes: the impact of service and non-market performance vesting
conditions (e.g., profitability, sales targets, or continued employment); and
· Includes: the impact of any non-vesting conditions (e.g., employee
savings or shareholding requirements).
At each reporting date, the Group reviews and updates its estimate of the
number of options expected to vest, based on service and non-market
performance conditions. Any adjustment to original estimates is recognised in
profit or loss, with a corresponding impact on equity.
The options are administered by the Board, which issues the relevant number of
shares upon exercise. Proceeds received on exercise, net of any directly
attributable transaction costs, are credited directly to equity.
2.22 Warrants
The Company issues warrants that entitle holders to subscribe for ordinary
shares at a fixed price over a defined exercise period.
Warrants are assessed at inception to determine whether they fall within the
scope of IFRS 2 - Share-based Payment or IAS 32 - Financial Instruments:
Presentation, based on the nature of the counterparty and transaction.
Warrants issued in exchange for goods or services are accounted for under IFRS
2 as equity-settled share-based payments.
Warrants issued in a financing or capital raising context, where the
counterparty acts in its capacity as an investor or lender, are accounted for
under IAS 32 as equity instruments, provided they meet the fixed-for-fixed
criterion.
Warrants classified within IFRS 2 are measured at fair value at the grant date
using an option pricing model and recognised in profit or loss over the
vesting period, or immediately if vesting is immediate.
Warrants classified within IAS 32 are measured at fair value at grant date
using an option pricing model.
Any difference between fair value and proceeds received is recognised directly
in equity. No charge is recognised in profit or loss.
The valuation of warrants is based on a Black-Scholes model using assumptions
including expected volatility, expected life, risk-free interest rate, and
dividend yield (assumed nil unless otherwise stated). Where limited historical
data exists, volatility is derived from comparable listed entities.
Warrants are classified as equity instruments where they meet the
fixed-for-fixed requirement and do not confer voting or dividend rights until
exercised.
2.23 Related Parties
For the purposes of these consolidated financial statements, a party is
considered to be related to the Group if:
I. the party has the ability, directly or indirectly, through one or
more intermediaries, to control the Group or exercise significant influence
over the Group in making financial and operating policy decisions, or has
joint control over the Group;
II. the Group and the party are subject to common control;
III. the party is an associate of the Group or a joint venture in which the
Group is a joint venturer;
IV. the party is a member of key management personnel of the Group or the
Group's parent, or a close family member of such an individual, or is an
entity under the control, joint control, or significant influence of such
individuals;
V. the party is a close family member of a party referred to in (i) or is
an entity under the control, joint control, or significant influence of such
individuals;
VI. the party, or any member of a group of which it is part, provides key
management personnel services to the Group or its parent.
2.24 Equity and reserves
Share capital represents the total amount received by the Company in
consideration for shares issued. This includes amounts received on the
issuance of both ordinary and preference shares, net of any transaction costs
directly attributable to the equity issuance.
Other components of equity include the following:
· Equity component of convertible instruments (such as convertible loan
notes) is recognised separately within equity when the instrument includes a
conversion option that meets the definition of equity. The equity component is
measured at the residual amount after deducting the fair value of the
liability component from the fair value of the compound instrument as a whole
at initial recognition. The equity component is not subsequently remeasured.
On conversion, the related equity component is transferred within equity to
share capital. If the instrument expires or is settled without conversion, the
equity component remains in equity.
· Foreign Currency Translation reserve comprises foreign currency
translation differences arising from the translation of financial statements
of the Group's foreign entities into GBP.
· Share option reserve represents the cumulative fair value of
equity-settled share-based payments granted to employees and others providing
similar services. The reserve is increased by charges for the fair value of
options over the vesting period. On lapse or forfeiture, the balance is
transferred to retained earnings.
· Share warrant reserve represents the equity component of warrants
issued by the Group. Warrants are initially recognised at fair value on the
date of grant, with the corresponding credit recorded in the warrant reserve
within equity. No subsequent remeasurement is made to the warrant reserve.
When warrants are exercised, the proceeds received, together with the amount
previously recognised in the warrant reserve, are transferred to share capital
as appropriate. If warrants expire unexercised, the balance in the warrant
reserve is retained within equity.
3. CRITICAL ESTIMATES, JUDGEMENTS AND ERRORS
When preparing the Group's consolidated financial statements, management makes
a number of judgements, estimates and assumptions about the recognition and
measurement of assets, liabilities, revenue and expenses.
The following are the judgements and estimates made by management in applying
the accounting policies of the Group that have the most significant effect on
these consolidated financial statements.
Significant management judgements
Capitalisation of plant development cost
The Group applies judgement in determining whether costs incurred in the
development, upgrade and pre-operational activities of plant assets meet the
criteria for capitalisation in accordance with applicable accounting
standards. Such costs are capitalised only where they are directly
attributable to bringing the asset to the condition necessary for it to be
capable of operating as intended by management and where they are expected to
generate future economic benefits. During the year ended 31 December 2025, the
Group capitalised £1,218k (2024: £632k) of costs relating primarily to
pre-operational and development activities for plant assets. These costs have
been included within Development and Upgrade Costs.
Management exercises judgement in assessing whether such costs are directly
attributable to the construction and commissioning of the plant and whether
the projects remain technically feasible and commercially viable. The
recoverability of these capitalised amounts is dependent on the successful
completion and commissioning of the plant assets and the generation of
forecast future cash flows. The Group monitors the projects for indicators of
impairment and considers factors including anticipated commissioning
timelines, forecast energy output and expected tariff rates.
Assessment of Deferred Tax Asset Recognition
The Group assesses at each reporting date the recoverability of deferred tax
assets arising from deductible temporary differences and unused tax losses.
This assessment requires judgement in evaluating whether it is probable that
sufficient future taxable profits will be available against which such amounts
can be utilised, taking into account legal, regulatory and economic factors in
the relevant tax jurisdictions.
Based on this assessment, and given the Group's continued loss-making position
and the uncertainty regarding the timing and level of future taxable profits,
no deferred tax assets have been recognised in the consolidated financial
statements.
Significant estimates
Impairment of goodwill
During the current year, the Group performed its annual impairment assessment
using recoverable amounts determined with reference to value-in-use and/or
fair value less costs of disposal calculations. This assessment requires
management to make significant estimates and assumptions in relation to future
cash flows, including projected operating performance, capital expenditure and
long-term growth assumptions, as well as the determination of appropriate
discount rates.
As part of the impairment assessment, the Group utilised an independent
external valuation of the relevant plant assets that was performed in May
2025. The same valuation was used as an input into both the prior year and
current year assessments, with management updating and assessing the
underlying cash-flow assumptions to reflect conditions at the current
reporting date. The plant assets represent a significant component of the
related cash-generating units.
Management has reviewed and concurred with the assumptions and methodology
used in the external valuation. However, this assessment remains subject to
estimation uncertainty, and any changes in key assumptions may affect future
impairment conclusions. Further details of the key assumptions used are
provided in Note 14.
Useful lives and residual values of depreciable assets
Management reviews its estimate of the useful lives and residual values of
depreciable assets at each reporting date, based on the expected utility of
the assets. Uncertainties in these estimates relate to technological
obsolescence that may change the utility of certain software and IT equipment
and environmental regulations that can require polluting assets to be
depreciated more quickly
Fair value measurement of derivative call option
The Group has entered into a call option agreement granting it the right to
acquire a 100% equity interest in another entity for a fixed cash
consideration. The call option is classified as a derivative financial
instrument and is measured at fair value through profit or loss in accordance
with IFRS 9.
The determination of the fair value of the call option involves significant
management judgement, including assessment of factors such as the probability
of exercise, expected volatility of the underlying investment, and market
conditions. The fair value is subject to estimation uncertainty, and changes
in these judgements could materially affect the Group's profit or loss.
Further details are disclosed in Note 6.
Leases - determination of the appropriate discount rate to measure lease
liabilities
The Group enters into leases with third parties 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 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. These rates are, where
necessary, then adjusted to reflect the creditworthiness of the entity
entering into the lease and the specific condition of the underlying leased
asset. The estimated incremental borrowing rate is higher than the parent
company for leases entered into by its subsidiary undertaking
Fair value measurement of contingent financial liabilities
The Group recognises certain contingent financial liabilities arising from
contractual arrangements, which are measured at fair value through profit or
loss.
The fair value of these liabilities is determined using probability-weighted
cash flow models, which require management to estimate the likelihood and
timing of future events, such as the achievement of specified milestones or
conditions. These cash flows are discounted using appropriate discount rates
reflecting the time value of money and risks specific to the liability.
Given the long-term and uncertain nature of these assumptions, the resulting
fair value is subject to significant estimation uncertainty. Changes in key
assumptions, including probability assessments and discount rates, may
materially affect the carrying amount of the liability and the corresponding
charge or credit to profit or loss. Further information is provided in Note
22.
4. FINANCIAL RISK MANAGEMENT
This note explains the Group's exposure to financial risks and how these risks
could affect the Group's future financial performance. Current year profit and
loss information has been included where relevant to add further context.
The Group does not actively engage in the trading of financial assets for
speculative purposes nor does it write options. The most significant financial
risks to which the Group is exposed are described below
4.1 Categories of financial assets and financial liabilities
31 December 2025 Amortised cost FVTPL Total
£'000 £'000 £'000
Trade and other receivables 648 - 648
Cash and cash equivalents 706 - 706
Derivative asset - - -
Total financial assets 1,354 - 1,354
31 December 2025 Amortised cost FVTPL Total
£'000 £'000 £'000
Non-current borrowings 9,352 - 9,352
Financial liabilities - contingent consideration - 2,792 2,792
Trade and other payables 1,126 - 1,126
Total financial liabilities 10,478 2,792 13,270
31 December 2024 Amortised cost FVTPL Total
£'000 £'000 £'000
Trade and other receivables 413 - 413
Cash and cash equivalents 375 - 375
Total financial assets 788 - 788
31 December 2024 Amortised cost FVTPL Total
£'000 £'000 £'000
Non-current borrowings 10,590 - 10,590
Current borrowings 390 - 390
Trade and other payables 1,525 - 1,525
Total financial liabilities 12,505 - 12,505
4.2 Financial risk management
I. Market risk analysis
Foreign exchange risk
Most of the Group's transactions are carried out in GBP. Exposures to currency
exchange rates arise from the Group's borrowings, some loans are denominated
in Euro (EUR).
The Group mitigates its euro-currency exposure by maintaining a dedicated euro
bank account for seamless transfers and engaging a designated agent to convert
funds at competitive rates; it also executes early transfers of forecast euro
inflows to match project outflows, closely monitors its net open euro
position.
Foreign currency denominated financial assets and liabilities, which expose
the Group to currency risk, are disclosed below. The amounts presented
represent those reported to key management, translated into GBP at the closing
exchange rate. The Group's exposure arises primarily from its Finnish
subsidiary, whose functional currency is EUR.
Short-term exposure Long-term exposure
EUR SEK EUR
31 December 2025
Financial assets - - 8,356
Financial liabilities - - (10,814)
Total exposure - - (2,457)
31 December 2024
Financial assets - - 4,011
Financial liabilities - (72) (5,532)
Total exposure - (72) (1,521)
The following sensitivity analysis illustrates the impact of changes in
foreign exchange rates on the Group's profit or loss, assuming all other
variables remain constant. A change of ±5% has been applied to the relevant
foreign exchange rates, which the Directors consider to be a reasonably
possible change at the reporting date. In the prior year, different
sensitivity percentages were applied to certain currencies; however, the
Directors have standardised the sensitivity assumption in the current year to
improve consistency and comparability across periods.
If the GBP had strengthened against the EUR by 5% (2024: 5%). During the
current year all SEK-denominated loans were fully settled and, accordingly,
the Group had no SEK exposure at the reporting date.
Profit for the year Equity Total
EUR SEK EUR
31 December 2025 73 - 50 123
31 December 2024 67 5 9 81
If the GBP had weakened against the EUR by 5% (2024: 5%) and SEK by N/A (2024:
7%). During the current year all SEK-denominated loans were fully settled and,
accordingly, the Group had no SEK exposure at the reporting date.
Profit for the year Equity Total
EUR SEK EUR
31 December 2025 (73) - (50) (123)
31 December 2024 (67) (5) (9) (81)
During the year, Group has recorded £24k foreign-exchange related losses
[2024 - gain £17k] were recognised in statement of comprehensive income.
Interest rate risk
The Group's fixed-rate borrowings, including compound financial instruments
such as interest-free convertible loans, are carried at amortised cost. While
market interest rates are used in the initial measurement of such instruments
to allocate between liability and equity components, they do not give rise to
ongoing interest rate risk. This is because the carrying amounts and future
cash flows of these instruments are not remeasured based on changes in market
interest rates.
Interest rate risk(continued)
The Group does not hold any variable-rate financial instruments. Accordingly,
the Group is not exposed to interest rate risk as defined under IFRS 7.
II. Credit risk
Credit risk is the risk that a counterparty fails to discharge an obligation
to the Group. The Group is exposed to credit risk from financial assets
including cash and cash equivalents held at banks, trade and other
receivables.
The credit risk is managed on a Group basis based on the Group's credit risk
management policies and procedures.
The Group's exposure to credit risk is primarily limited to its cash balances
held in bank accounts and trade receivables. To mitigate this risk, the Group
holds the majority of its cash and cash equivalents with reputable banks with
strong credit profiles. Group's main cash resources are held with banks with
an external rating of B. Trade receivables majorly relate to a one customer,
which concentrates credit risk but is monitored regularly to ensure
recoverability.
The Group applies the expected credit loss ("ECL") model in accordance with
IFRS 9. No loss allowance has been recognised as management considers the ECL
to be immaterial. The Group's exposure to credit risk is currently limited due
to the nature and volume of its trade receivables and the Group being in a
pre-operational stage. Based on ongoing oversight by management, the Group
considers the credit risk associated with its trade receivables to be low. As
the Group transitions into operational activities, it will implement more
formal credit risk assessment processes and policies appropriate to the scale
and nature of its operations.
As at the reporting date, the Group's maximum credit risk exposure corresponds
to the carrying amount of cash and cash equivalents and trade receivables on
the balance sheet. This represents the maximum amount that could be at risk
should any counterparty fail to meet its obligations.
As at 31 December 2025, the Group's trade receivables, which are financial
assets measured at amortised cost, are all current. The following table
provides an ageing analysis of trade receivables:
2025 2024
£'000 £'000
0 to 3 months 332 413
3 to 6 months 316 -
6 months + - -
Total 648 413
III. Liquidity Risk
Liquidity risk is that the Group might be unable to meet its obligations. The
Group manages its liquidity needs by monitoring scheduled debt servicing
payments for long-term financial liabilities as well as forecast cash inflows
and outflows.
The Group's objective is to maintain cash and marketable securities to meet
its liquidity requirements for 30-day periods at a minimum. The Group
currently holds cash balances to provide funding for normal trading activity.
Trade and other payables are monitored as part of normal management routine.
As at 31 December 2025, all financial liabilities were classified at amortised
cost. A maturity analysis of the Group's non-derivative financial liabilities
has contractual maturities (including interest payments where applicable) as
summarised below:
31 December 2025 Within 6 months 6 to 12 months 1 to 5 years £'000 Later than 5 years £'000
£'000 £'000
Borrowings - - 4,572 8,359
Lease liabilities 157 157 1,257 13,568
Financial liabilities - contingent consideration - - 2,792 -
Trade and other payables 492 337 - -
Total financial liabilities 649 494 8,621 21,927
31 December 2024 Within 6 months 6 to 12 months 1 to 5 years £'000 Later than 5 years £'000
£'000 £'000
Borrowings - 72 1,794 16,620
Lease liabilities 150 150 1,200 13,254
Trade and other payables 493 1,035 - -
Total financial liabilities 643 1,257 2,994 29,874
4.3 Fair value measurement
The Group measures certain financial instruments at fair value in the
statement of financial position. These fair values are categorised into the
fair value hierarchy based on the observability of significant inputs, in
accordance with IFRS 13 - Fair Value Measurement:
· Level 1: quoted prices (unadjusted) in active markets for identical
assets or liabilities
· Level 2: inputs other than quoted prices included within Level 1 that
are observable for the asset or liability, either directly or indirectly
· Level 3: unobservable inputs for the asset or liability.
The following table summarises the Group's financial instruments measured at
fair value:
Financial instruments Level 1 Level 2 Level 3 Total
£'000 £'000 £'000 £'000
Financial assets - Derivative assets - - - -
Financial liability - Contingent consideration - - 2,792 2,792
The Group currently has no Level 1 or Level 2 financial instruments measured
at fair value; all fair value amounts relate to Level 3 instruments.
No transfers occurred between levels.
Level 3 fair value measurement - Financial assets
· The fair value of derivative assets is determined using valuation
techniques based on unobservable inputs.
· The Group has assessed the fair value of the call option and
concluded that, as at the reporting date, its value is not material and has
therefore been determined to be nil.
· Given the nil valuation, changes in significant unobservable inputs,
including assumptions such as volatility and probability of exercise, would
not result in a material impact on the financial statements. Accordingly, a
sensitivity analysis has not been presented, more details are provided in Note
6.
· The valuation reflects management's assessment that the likelihood of
the option being exercised and generating economic benefit is remote at the
reporting date.
Level 3 fair value measurement - Financial liabilities
· The Group measures contingent liability now recognised at fair value,
using valuation techniques based on unobservable inputs.
· Key assumptions include the probability of settlement, expected
timing of outflows, and applicable discount rates.
· Changes in these significant unobservable inputs could materially
affect the fair value of the liability. A sensitivity analysis is provided in
Note 22.
The Group's finance team performs fair value measurements for reporting
purposes. Valuation techniques are selected based on the characteristics of
each instrument. The finance team reports directly to the CFO. Valuation
processes and fair value changes are reviewed by the CFO and CEO at least
annually in line with the Group's reporting dates.
5. CAPITAL MANAGEMENT POLICIES AND PROCEDURES
The Group's objectives when managing capital are to safeguard its ability to
continue as a going concern and to maintain sufficient funding to support the
development and operation of its on-going projects.
The Group considers its capital to comprise total equity and borrowings.
Management monitors capital based on the Group's cash position, available
funding and overall equity position as presented in the consolidated statement
of financial position.
As the Group continues to develop its projects, it may incur operating losses
and therefore relies on a combination of shareholder support and external
financing to fund its activities. Management reviews the Group's capital
requirements regularly and takes appropriate actions to ensure that adequate
resources are available to meet its obligations as they fall due.
The Group is not subject to any externally imposed capital requirements.
6. INVESTMENTS AND DEVELOPMENT AGREEMENTS
German Geothermal Development Structure
During the period, the Group entered into an agreement to establish a new
investment structure in Germany focused on the development of geothermal
energy assets. The arrangement involved the creation of a holding entity and
underlying project companies to progress three geothermal projects.
Ownership and Governance
In March 2025, the Cindrigo Geothermal Limited a 100% subsidiary of the
Company entered into an investment agreement with Zukunft Geowärme GmbH
("ZGG") for developing three geothermal projects via dedicated SPVs.
The intention was that new companies would be established, comprising one new
German holding company and three SPVs, with Zukunft Geoenergie GmbH ("ZGE")
serving as the holding entity. The Group was to ultimately hold 85% of the
shares in this holding company, with the remaining 15% held by ZGG. However,
due to administrative arrangements at the time of incorporation, the shares
were initially registered in the name of the parent company, Cindrigo Holdings
Limited.
In addition, three project companies, ZGE 1, ZGE 2 and ZGE 3, have been
incorporated in respect of each geothermal licence, with 100% of their shares
held by ZGE.
As at 31 December 2025, Cindrigo Holdings Limited held 100% of the shares in
ZGE. The transfer of shares to the agreed shareholding structure is expected
to be completed subsequently. A shareholders' agreement governs the rights and
obligations of the parties.
Contingent Liabilities - BEW and KfW Funding Entitlements
Under the investment agreement, milestone bonuses of up to €1M per project
are payable to ZGG's shareholders if each project secures at least €15M of
German federal funding (e.g., BEW/KfW). A pro-rata bonus applies for funding
between €10M to €15M, with no payment due if less than €10m of German
federal funding is received. An additional €5M per project is payable if,
post-completion, average output across all three plants meets or exceeds 22
MW.
While these payments are contractually contingent on future events, management
has assessed that the Group has a present obligation under the terms of the
agreement and that an outflow of economic benefits is probable. Accordingly, a
provision has been recognised in the statement of financial position as at 31
December 2025. Further details of the provision, including measurement and key
assumptions, are disclosed in Note 22.
Call Option on ZGG Shareholding
The Group has entered into a call option agreement granting it the right, but
not the obligation, to acquire 100% of the issued share capital of ZGG for a
fixed consideration of €600,000, exercisable at any time up to April 2027. A
fee of £64k (€75k) was paid on inception in respect of the grant of option.
o Accounting classification and initial recognition
The call option meets the definition of a derivative financial instrument
under IFRS 9, as its value changes in response to an underlying variable, it
requires little or no initial net investment relative to other contracts with
a similar response to market factors, and it is settled at a future date. On
initial recognition, the fee paid of £64k in respect of the grant of the
option was recognised as a financial asset at fair value.
o Subsequent measurement
In accordance with IFRS 9, the call option is subsequently measured at fair
value through profit or loss (FVTPL) at each reporting date.
At 31 December 2025, the fair value of the option has been assessed as nil
(see Fair Value Measurement below). Accordingly, a fair value loss of £64k
has been recognised in profit or loss for the year (2024: £nil).
o Fair value measurement
The fair value of the call option has been assessed in accordance with IFRS
13, which defines fair value as the price that would be received to sell an
asset in an orderly transaction between market participants at the measurement
date.
The underlying investment, ZGG, is a private limited company that does not
currently generate operating revenues and incurs only administrative expenses.
Its principal assets comprise three geothermal licences, which remain legally
registered in ZGG's name but are not capitalised in its financial statements.
These licences are in early-stage development, with no secured project
financing in place, and development timelines are expected to extend beyond
the remaining term of the option.
Although the option is currently out of the money relative to its €600,000
exercise price and was acquired in March 2025, management has reassessed the
relevance of the transaction price at the reporting date. In light of the
limited progress in the underlying project, the absence of financing, and the
shortened remaining term of approximately 16 months, the conditions and
assumptions underpinning the initial transaction price are no longer
considered reflective of those that would be applied by market participants at
the measurement date.
Accordingly, the valuation reflect current circumstances, under which the
likelihood of the option delivering economic benefit prior to expiry is
considered remote. On this basis, the fair value of the option at the
reporting date has been assessed as nil. Settlement of the option, if
exercised, would be made in cash at the contractual exercise price of
€600,000.
The valuation relies on unobservable inputs and is classified as Level 3 in
the IFRS 13 fair value hierarchy.
o Level 3 valuation technique and inputs
The fair value of the call option has been determined using a
probability-weighted assessment of potential outcomes, reflecting assumptions
that market participants would apply at the measurement date. Significant
unobservable inputs include the probability of the underlying project
achieving commercial viability within the option term, the expected timing of
development milestones, and assumptions regarding the availability of project
financing. Changes in these inputs are not expected to result in a material
increase to the fair value, which has been assessed as nil at 31 December
2025.
o Sensitivity analysis
The fair value is most sensitive to changes in the assumed probability of the
project achieving commercial viability prior to the option's expiry.
Reasonably possible changes in these assumptions would not result in a
material increase in the fair value at the reporting date.
o Reconciliation
2025
£'000
Opening balance 1 January 2025 -
Additions/fees paid 64
Fair value loss recognised in profit or loss (64)
Settlements / exercises -
Closing balance 31 December 2025 -
7. REVENUE
2025 2024
£'000 £'000
Management services 256 -
Personnel leasing 7 -
Sale of energy, Heat - 85
Total 263 85
Revenue for the year comprises income from management services provided to
Fuelwood Finland Oy, which represents the Company's principal source of income
in the current year.
In the year ended 31 December 2025, revenue of £256k arose from services
provided to a single external customer, representing 97% of Group's total
revenue. In the year ended 31 December 2024, revenue of £85k arose from the
sale of heat to a single external customer, representing 100% of the Group's
total revenue. Revenue was reported within the Group's single operating
segment.
At 31 December 2025, the Group had no contract assets and no contract
liabilities. Revenue is recognised over time for management services because
the customer simultaneously receives and consumes the benefits as the Group
performs. The transaction price is determined by agreed contractual terms and
does not include variable consideration. The Group applies the practical
expedient in IFRS 15 Revenue from Contracts with Customers paragraph 121 and
therefore does not disclose information about remaining performance
obligations for contracts with an original expected duration of one year or
less.
Personnel leasing income is not a principal source of the Company's revenue
and arises on a one-off, non-recurring basis. Such income is recognised in the
period in which the related services are provided.
8. OTHER INCOME
2025 2024
£'000 £'000
Gain on settlement of deferred consideration 99 -
Total 99 -
In April 2024, the Group completed the acquisition of the issued share capital
of Kaipola. Part of the consideration for the acquisition was structured as
deferred consideration payable in accordance with the original share purchase
agreement.
Subsequent to the initial agreement, the terms of the deferred consideration
were amended to allow for early settlement at a discounted amount, which the
Group elected to exercise. The resulting reduction in the deferred
consideration liability has been recognised as a gain in the consolidated
statement of comprehensive income within "other income" for the period.
The discount obtained forms part of the maximum earn-out and is disclosed in
the Note 22.
9. ADMINISTRATIVE EXPENSES
Administrative expense comprise of following:
2025 2024
£'000 £'000
Consulting fees 779 889
Bonus payments 155 775
Directors' fees 106 65
Termination benefits - director resignation 57 -
Listing-related expenses 1,020 223
Legal and professional fees 158 129
IR, communication and marketing 186 103
Travelling 243 140
Audit, accountancy and related services 244 118
Development costs - German geothermal projects 66 -
Foreign exchange (gain)/loss 24 (17)
Other administrative costs 91 90
Share option expense (33) 674
Loan arrangement fees - 1,553
Wages and social security - 29
Loss on parent's settlement of ex-subsidiary debt - 62
Total 3,096 4,833
Included within administrative expenses for 2024 is £1,553k relating to costs
incurred in connection with securing financing for the acquisition of a new
subsidiary, under arrangements whereby the lender was granted a 10% equity
interest in the acquired entity as part of the financing terms. These costs
were previously presented within finance costs but have been reclassified to
administrative expenses in the current year to better reflect their nature as
transaction-related arrangement costs associated with the acquisition and
financing structure. This reclassification has no impact on loss for the year,
total equity, net assets, or cash flows.
In order to improve consistency, £223k of listing-related costs previously
presented within "Legal and professional fees" in 2024 have been reclassified
to "Listing-related expenses" in that year. No totals are affected.
Audit, accountancy and related services includes:
2025 2024
£'000 £'000
Audit fees 188 50
Non-audit service fees 28 62
Other 28 6
Total 244 118
Fees for non-audit services were paid to auditors other than Grant Thornton.
10. FAIR VALUE GAINS/(LOSSES)
Note 2025 2024
£'000 £'000
Financial assets at fair value 6 64 -
Financial liabilities at fair value 22 2,792 -
Total 2,856 -
11. IMPAIRMENT OF FINANCIAL ASSETS
2025 2024
£'000 £'000
Restated
Write‑off of debtor balance 107 -
Intercompany loans write off - (25)
Total 107 (25)
During the year, the Group wrote off an irrecoverable trade debtor balance of
£107k after concluding there was no reasonable expectation of recovery in
accordance with IFRS 9. The write‑off resulted in a charge recognised within
Impairment of financial assets. No further recoveries are expected.
Dravacel - Reclassification of Prior Year Presentation
In the prior year, the Group recognised two amounts relating to Dravacel
d.o.o.:
· £4,329k - write‑off of intercompany balances due from Dravacel
following its liquidation; and
· £1,184k - net impairment charge relating to the suspension of
the Slatina 3 Project (being the difference between a £4,447k impairment of
property, plant and equipment and a £3,263k gain on deconsolidation).
These amounts were aggregated and presented as "Impairment loss on financial
assets" in the 2024 financial statements.
As part of the current‑year review, the Group reassessed the presentation of
the Dravacel‑related charges to ensure compliance with the relevant IFRS
requirements. To provide clearer and more transparent information to users,
the Group has disaggregated the previously combined amounts and presented them
according to their nature.
The revised presentation is as follows:
· £4,447k - impairment and write‑off of property, plant and
equipment, now presented as "Impairment of non‑financial assets" in
accordance with IAS 36; and
· £1,066k - net loss on loss of control of subsidiary, comprising
the write‑off of intercompany balances of £4,329k and the gain on
deconsolidation of £3,263k, now presented as "Loss on loss of control of
subsidiary" in accordance with IFRS 10.
This change relates solely to presentation. It does not affect the total net
charge previously recognised, nor does it impact the Group's profit, net
assets, or cash flows for the prior year. The updated presentation simply
reflects the differing nature of the impairment and disposal‑related items
and enhances the clarity of the financial statements.
12. PROPERTY, PLANT AND EQUIPMENT
Machinery and equipment Furniture and other movables Development/ Upgrade cost Land Assets under construction Total
£'000 £'000 £'000 £'000 £'000 £'000
Gross carrying amount
As at 1 January 2025 73 2 632 - - 707
Additions 242 - 1,218 - - 1,460
At 31 December 2025 315 2 1,850 - - 2,167
Depreciation and Impairment
As at 1 January 2025 (19) - - - - (19)
Depreciation (74) (1) (63) - - (138)
Impairment
At 31 December 2025 (93) (1) (63) - - (157)
Carrying amount 31 December 2025 222 1 1,787 - - 2,010
Machinery and equipment Furniture and other movables Development/ Upgrade cost Land Assets under construction Total
£'000 £'000 £'000 £'000 £'000 £'000
Gross carrying amount
As at 1 January 2024 - - - 612 1,532 2,144
Additions 73 2 632 - 2,915 3,622
Disposal - liquidation of subsidiary - - - (612) - (612)
At 31 December 2024 73 2 632 - 4,447 5,154
Depreciation and Impairment
As at 1 January 2024 - - - - - -
Depreciation (19) - - - - (19)
Impairment - - - - (4,447) (4,447)
At 31 December 2024 (19) - - - (4,447) (4,466)
Carrying amount 31 December 2024 54 2 632 - - 688
The Group had no contractual commitments for the acquisition of property,
plant and equipment as at 31 December 2025.
Machinery and Equipment and furniture and other movables are assets held by
the newly acquired subsidiary, Kaipola. During the year, the Group incurred
additional costs relating to plant improvements and enhancements to
operational infrastructure.
Development/Upgrade Costs represent capitalised expenditures incurred in
connection with plant improvements and infrastructure enhancements at the
Kaipola facility. These investments are intended to modernise operations,
improve production efficiency, and support the Group's long-term strategic.
Land and assets under construction were related to the Slatina 3 Project, held
through Dravacel, were fully impaired in the prior year, following the
liquidation of the subsidiary, as the recoverable amount of these assets was
assessed to be nil.
13. LEASES
Right-of-use assets - Leased Plant - Reconciliation of Carrying Amounts
2025 2024
£'000 £'000
Gross carrying amount
As at 1 January 4,452 -
Additions - 4,452
Disposal - -
Foreign exchange movement 211
At 31 December 4,663 4,452
Depreciation
As at 1 January (74) -
Depreciation (91) (74)
Foreign exchange movement (6)
At 31 December (171) (74)
Carrying amount 31 December 4,492 4,378
Lease liability
Lease liability is presented in the consolidated statement of financial
position as follows:
2025 2024
£'000 £'000
Current 16 14
Non-current 4,751 4,551
4,767 4,565
The Group has a single lease arrangement in respect of Kaipola plant with a
lease term of 50 years (the "Lease"). The Lease is recognised in the
consolidated statement of financial position as a right-of-use asset and a
corresponding lease liability. Under the Lease, a fixed rent of €30k per
month is payable up to 50% of the Plant's output, with a potential additional
variable rent of up to €70k per month depending on performance above 50%
output. For the calculation of the right-of-use asset and lease liability,
only the fixed €30 monthly rent has been considered, and not the variable
portion, as it is contingent upon future output levels. These payments vary
with actual production levels and are therefore excluded from the lease
liability under IFRS 16.27. Variable lease payments recognised in statement of
comprehensive income during the year were £0k (2024: £0k). The Group is
exposed to future cash-flow variability as these payments may become
significant if output increases. Management monitors expected production
levels when assessing future lease-related cash flows.
The lease liability has been measured as the present value of the fixed lease
payments over the lease term, discounted using the Group's incremental
borrowing rate of 6.27%, which represents the rate that the Group would have
to pay to borrow, over a similar term and with similar security, the funds
necessary to obtain an asset of a similar value in a similar economic
environment.
The lease agreements restrict the Group's ability to transfer, sublease, or
grant rights to third parties over the leased assets or premises. Leases are
generally non-cancellable, or may only be terminated upon payment of a
substantial termination fee.
Kaipola holds a pre-emption right against third parties if the Lessor decides
to sell all or part of the properties. In such cases, the transfer price shall
be based on a bank-verified binding offer made by a third party for the
purchase of the leased property or a portion thereof. Any pre-emption
transaction will be conducted under the same terms and conditions as the
binding offer from the third party.
Maturity analysis of undiscounted lease liabilities:
Within 1 year 1-5 years After 5 years Total
£'000 £'000 £'000 £'000
Lease liabilities at 31 December 2025 314 1,257 13,568 15,140
Lease liabilities at 31 December 2024 300 1,200 13,254 14,754
Interest expense of £293k (2024 - £213k) were incurred on lease liabilities.
Total cash outflow for the Lease for the year ended 31 December 2025 is £358k
(€420k) (2024 - NIL), rental payments totaling £51k (€60k) were
unpaid, are included in trade and other payables at the year end.
14. GOODWILL
2025 2024
£'000 £'000
Gross carrying amount
As at 1 January 15,533 -
Acquired through business combination - 15,533
Net exchange difference 376 -
At 31 December 15,909 15,533
Accumulated impairment
As at 1 January - -
Impairment loss recognised - -
At 31 December - -
Carrying amount 31 December 15,909 15,533
Impairment testing
The Group tests cash-generating units (CGUs) to which goodwill has been
allocated for impairment annually, or more frequently where indicators of
impairment exist. Goodwill is allocated to the Kaipola CGU (the "Plant"),
which represents the lowest level within the Group at which goodwill is
monitored for internal management purposes and is expected to benefit from the
synergies of the business combination.
o Determination of recoverable amount
The recoverable amount of the Kaipola CGU is determined on the basis of its
value-in-use (VIU).
As at 31 December 2025, management determined that the recoverable amount is
based on the VIU model:
a. Value-in-use (VIU): £133,017k (2024: £272,326k)
b. Carrying amount of CGU: £22,411k
c. Headroom (a - b): £110,606k
o Value-in-use (VIU)
The VIU was calculated using a discounted cash flow (DCF) model.
Key assumptions used in the VIU model are as follows:
· Forecast period: 5 years, based on management-approved budgets
and forecasts
· Terminal value: A terminal value is applied at the end of the
5‑year forecast period to reflect estimated cash flows over the remaining
operational life of the plant of approximately 45 years, being the balance of
an estimated total operational life of 50 years.
· Discount rate: 10% (pre-tax), reflecting current market
assessments of the time value of money and risks specific to the CGU, to the
extent that such risks are not already incorporated in the forecast cash
flows.
· Revenue growth: Revenue during the explicit forecast period is
based on existing contracted revenues. Beyond the forecast period, growth
assumptions are conservative and aligned with long‑term inflationary
expectations, with no material volume expansion assumed.
· Long-term growth rate: 2%, consistent with long‑term inflation.
This rate does not include speculative growth or incremental operational
efficiencies, which are not assumed beyond existing contractual arrangements
· Capital expenditure assumptions include only committed and
maintenance capital expenditure and exclude uncommitted upgrades, expansions,
or enhancements.
· Operational efficiencies: Forecast cash flows assume only
operational efficiencies already identified and supported by existing
contracts. No uncommitted or speculative efficiency improvements are included
The VIU calculated using these assumptions is £133,017k.
o CGU composition and carrying amount
The carrying amount of the Kaipola CGU includes:
Asset class Amount
£'000
Goodwill 15,909
Property, plant and equipment directly attributable to the plant 2,010
Right-of-use asset capitalised, directly attribute to plant 4,492
Total CGU carrying amount 22,411
o Sensitivity analysis
The recoverable amount is sensitive primarily to the discount rate, terminal
growth rate and forecast operating cash flows.
Sensitivity Analysis - Value in Use (VIU)
Assumption Base Case Sensitivity NPV / VIU Change vs Base Case
Discount rate 10% +1% (11%) £127,245k -£5,772k
Terminal growth rate 2.0% -0.5% (1.5%) £125,894k -£7,123k
+0.5% (2.5%) £141,091k +£8,074k
Operating cash flows Base cash flows -5% £126,367k -£6,650k
o Conclusion
As at 31 December 2025, the recoverable amount of the Kaipola CGU exceeds its
carrying amount. Accordingly, no impairment loss has been recognised.
15. EXPLORATION AND EVALUATION ASSETS
Contractual rights
£'000
Gross carrying amount
As at 1 January 2025 -
Additions 223
Net exchange difference -
At 31 December 2025 223
Accumulated impairment
As at 1 January 2025 -
Impairment losses -
At 31 December 2025 -
Carrying amount 31 December 2025 223
Additions and recognition
During the year ended 31 December 2025, the Group entered into an investment
agreement with an investor ZGG (see Note 6). Under the agreement:
· The Group assumed responsibility for ZGG's shareholder loans with an
aggregate nominal amount of £87k (€100k) (the "ZGG shareholder loans").
This assumption of liabilities constitutes consideration for the acquisition
of contractual rights to use geothermal licences held by a third party.
· In addition, the Group incurred further exploration and evaluation
("E&E") expenditure during the year in connection with its geothermal
projects, including costs relating to field appraisal studies and technical
assessments. An amount of £136k relating to such expenditure has been
capitalised during the year.
As at 31 December 2025, all three projects/licenses (ZGE 1, ZGE 2 and ZGE 3)
are in the exploration and evaluation phase. Activities undertaken to date
include field appraisal studies and ongoing technical assessments. No
commercial production has commenced.
Level of Cash-Generating Units
For impairment assessment purposes, the Group has determined that the three
licences collectively constitute a single cash-generating unit (CGU). This
reflects the integrated nature of the project: the licences are expected to be
developed together using shared infrastructure and funding, and the resulting
cash inflows are interdependent.
As a result, the Group does not capitalise costs separately per licence, but
on a combined project basis. Impairment assessments are performed at the
project CGU level in accordance with IFRS 6 and IAS 36. The CGU does not
exceed the level of an operating segment as defined in IFRS 8.
Impairment of exploration and evaluation assets
In performing the impairment assessment, management considered the following
indicators:
· The Group retains the right to explore in the relevant licence areas.
· Substantive expenditure on further exploration and evaluation is
planned and budgeted.
· Exploration activities have not led to a decision to discontinue the
projects.
· There is sufficient data to indicate that the carrying amount is
expected to be recovered through successful development or sale.
Additional indicators assessed:
External indicators
· Licences have been renewed for the current period
· No adverse regulatory changes in Germany
· No legal challenges or restrictions identified
Internal indicators
· Ongoing field appraisal and technical evaluation activities
· No intention to abandon or suspend the projects
· Continued availability of financing and technical resources
Based on the assessment performed, management concluded that no impairment
indicators were present as at 31 December 2025, and therefore no impairment
loss has been recognised.
Future development
Upon demonstration of technical feasibility and commercial viability, the
exploration and evaluation assets will be reclassified to development or
production assets. At that point, the assets will be amortised over their
expected useful lives.
16. SHARE CAPITAL
a. Issued and fully paid
Number of shares Share capital
account
£'000
At 1 January 2025 214,949,325 38,360
Shares issued and fully paid during the year
- Share issue, open offer 48,106,124 2,886
- Share issue, placing 17,006,996 2,041
- Share issue, advisor/introducer 759,442 15
- Share issue, loan settled by issue of shares 51,090,867 6,508
Transaction costs related to share issues
- Placing fees (157)
- Other legal fees, charged by broker (46)
- Allocated to share warrant reserve (893)
At 31 December 2025 331,912,754 48,714
At 1 January 2024 142,041,530 22,583
Shares issued and fully paid during the year
- Share issue, Kaipola acquisition 13,636,364 12,778
- Share issue, open offer 59,271,431 3,556
Transaction costs related to share issues
- Placing fees (557)*
At 31 December 2024 214,949,325 38,360
*Of the total placing costs of £557k incurred during the prior year, £70k
was settled in cash and is presented as a financing cash outflow. The
remaining £487k was settled by the issue of equity instruments and represents
a non-cash financing transaction in accordance with IAS7
The Company's ordinary shares have a nominal value of £0.01 each. All issued
ordinary shares are uniform in all respects and constitute a single class for
all purposes. The issued ordinary shares rank pari passu and are entitled to
all dividends and other distributions declared thereafter.
During the year, the Company issued a total of 48,106,124 ordinary shares,
increasing share capital by £2,886k, pursuant to open offer subscriptions.
Placing fees directly attributable to this issue amounted to £34k and were
deducted from equity.
Following approval by shareholders at an Extraordinary General Meeting held on
24 October 2025, the Company undertook a capital reorganisation whereby each
ordinary share of £2.667609 was subdivided into one ordinary share of £0.01
and one deferred share of £2.657609. The deferred shares have no voting or
economic rights. The reorganisation had no impact on the total equity of the
Company.
In addition, on 31 October 2025 the issued and to be issued share capital of
the Company was admitted to trading on London Stock Exchange and the company
completed a placing of 17,006,996 ordinary shares of face value £0.01 each at
a price of £0.12 per share, raising gross proceeds of £2,041k before
expenses. Costs directly attributable to this transaction is £123k placing
fees, £46k other legal fees charged by broker.
Further 759,422 shares were issued to advisors/introducers in August 2020 to
settle advisory services. The amount for these shares was initially recorded
in the subscription reserve and has now been reclassified to share capital
upon issuance.
During the year, following Convertible Loan Notes were converted into ordinary
shares in accordance with their respective terms. On conversion, the carrying
value of the debt and the associated equity component were reclassified to
share capital in accordance with IAS 32. No gain or loss arose on conversion
of equity-classified instruments.
CLN reference Conversion date Shares issued Debt conversion (£'000) Equity reserve transferred (£'000)
Series 1 - YA II PN, Ltd 04 Nov 2025 1,090,856 529 270
Series 3 CLN - Danir AB 16 Dec 2025 6,122,594 465 237
Series 4 CLN - Danir AB 16 Dec 2025 15,750,000 1,128 579
Nil Coupon CLN 2031 - Danir AB 16 Dec 2025 25,399,333 1,027 557
May 2025 - Loan B - Danir AB 16 Dec 2025 2,247,884 1,579 107
May 2025 - Subscription agreement - Danir AB - partial settlement 16 Dec 2025 480,200 22 8
Total 51,090,867 4,750 1,758
Refer to Note 17 for details of warrants issued during the year. The net
impact of £893k arising from the allocation of proceeds to warrants has been
recognised within the share warrant reserve.
b. Deferred shares
Number of shares Nominal value
Deferred shares 263,055,449 2.657609
On 24 October 2025, the Company completed a capital reorganisation. As part of
this reorganisation, and following multiple share issues at prices below
nominal value, 263,055,449 deferred shares were created. The deferred shares
carry no voting rights and confer no rights to dividends or any other economic
participation in the Company. Although the deferred shares have a nominal
value of £2.657609 each, they have no economic substance and are therefore
excluded from recognised share capital.
c. Shares subscription reserve
As at 31 December 2025, the Company had received cash of £24k in respect of
share subscriptions. The corresponding 254,967 ordinary shares recorded within
the Share Subscription Reserve as at the reporting date. Upon issuance after
the year-end, the reserve will be transferred to Share Capital.
In addition, a bank receipt of £18k was received prior to the year-end;
however, the payer has not yet been identified. As shares cannot be allocated
until identification, the amount remains in the Subscription Reserve and no
shares have been issued respect of this amount.
17. SHARE WARRANTS GRANTED
Summary of Warrants Outstanding at Year End
Class of warrants Counterparty Exercise price Vesting Expiry Number of warrants Accounting treatment
Sponsor Warrants Sponsor £0.12 per share 31 Oct 2025 31 Oct 2030 1,666,666 IFRS 2
Broker Warrants Broker £0.12 per share 31 Oct 2025 31 Oct 2027 695,832 IFRS 2
Investor Warrants New investor £0.12 per share 31 Oct 2025 31 Jul 2026 17,176,995 IAS 32
Loyalty Warrants Existing shareholders £0.20 per share 31 Oct 2025 30 Apr 2026 13,000,000 IAS 32
Settlement Warrant Lender £0.2729 per share 31 Oct 2025 30 Apr 2027 3,297,879 IAS 32
Nature of Warrants
- Sponsor warrants were issued in consideration for advisory services
provided in connection with the Company's listing on LSE.
- Broker warrants were issued in consideration for services provided
in connection with the Placing.
- Investor warrants were issued as an incentive to subscribe for new
ordinary shares.
- Loyalty warrants were issued to certain existing shareholders who
entered into lock-in agreements with the Company.
- Settlement warrants were issued to two lenders in relation to loan
facilities entered into by the Group. The warrants formed part of the original
loan agreements but warrants were issued upon the listing of the Company
during the year.
Measurement of Fair Value
o Warrants within scope of IFRS 2
Sponsor and Broker warrants have been accounted for as equity-settled
share-based payments in accordance with IFRS 2 - Share-based Payment.
The fair value of the warrants measured at the grant date using a
Black-Scholes valuation model.
Key assumptions used in the valuation included expected volatility, risk-free
interest rate, expected life and a nil dividend yield. Expected volatility was
determined by reference to comparable listed companies due to the limited
trading history of the Company.
The inputs into the Black-Scholes Pricing Model were as follows:
Sponsor Warrants Broker Warrants
Exercise price 0.12 0.12
Expected volatility 76% 79%
Expected life 5 year 2 year
Risk-free rate 3.912% 3.769%
These warrants vested immediately and the full fair value was recognised in
the income statement.
o Within scope of IAS 32
Investor and Loyalty warrants were issued to shareholders in their capacity as
investors and not in exchange for goods or services. Accordingly, these
warrants fall outside the scope of IFRS 2 and have been accounted for as
equity instruments under IAS 32 - Financial Instruments: Presentation.
The fair value of the warrants measured at the grant date using a
Black-Scholes valuation model.
The inputs into the Black-Scholes Pricing Model were as follows:
Investor Warrants Loyalty Warrants Settlement Warrant
Exercise price 0.12 0.20 0.2729
Expected volatility 92% 92% 79%
Expected life 9 months 6 months 18 months
Risk-free rate 3.688% 3.688% 3.769%
· Investor and Loyalty warrants are treated as part of equity financing
transactions, with fair value recognised as a deduction from equity (as a
reduction in share capital), and no charge has been recognised in the income
statement in respect of these warrants.
· Settlement warrants, originally part of the loan agreement, were
issued upon the Company's listing as part of the overall financing
arrangement. In accordance with IAS 32, their fair value was determined at
issue and recognised as a reduction in equity, with a corresponding credit to
the share warrant reserve.
As the warrants vested immediately, the full charge was recognised in the
year.
Reconciliation of Warrants
Number of Value
shares £'000
Outstanding at 1 January 2025 - -
Granted 35,837,375 893
Exercised/expired - -
Outstanding at 31 December 2025 35,837,372 893
The value represents the cumulative fair value of the warrants recognised in
the warrant reserve.
Potential Dilution
At the reporting date, the exercise of all outstanding warrants would result
in the issue of 35,837,372 additional ordinary shares for gross proceeds of
£5,845k.
18. CASH AND CASH EQUIVALENTS
2025 2024
£'000 £'000
Cash at bank and in hand 706 375
Total 706 375
Cash and cash equivalents comprise cash at bank and in hand, held by the
Group. As at the reporting date, all cash and cash equivalents are available
for use by the Group without restriction. There are no balances that are
pledged, held in escrow, or otherwise subject to restriction.
19. INVENTORIES
2025 2024
£'000 £'000
Raw materials and consumables 182 163
Total 182 163
For the years ended 31 December 2025 and 2024, inventories were recognised in
statement of comprehensive income as part of cost of sales. The Group did not
record any write-down of inventories to net realisable value during either
reporting period.
20. TRADE AND OTHER RECEIVABLES
2025 2024
£'000 £'000
Prepayments and accrued income 46 32
Trade debtors 332 105
Other debtors 270 276
Total 648 413
All trade and other receivables ae classified as current. The net carrying
amounts of these receivables are considered to be a reasonable approximation
of their fair value due to their short-term nature. As at 31 December 2025,
the Group has not recognised any impairment losses on trade receivables. The
Group continues to monitor credit risk and applies the simplified approach
under IFRS 9 Financial Instruments to measure expected credit losses, using
a lifetime expected credit loss model.
21. BORROWINGS
2025 2024
£'000 £'000
Current
Other loans - 390
- 390
Non-current
Other loans 4,032 -
Loan notes 5,320 10,590
9,352 10,590
Total 9,352 10,980
Details of the calculation of borrowings are set out in Table 1, while the
terms and other relevant details of each borrowing arrangement are provided in
Table 2.
Table 1 - Loan notes (Debt components)
Non-current
Note Note Note Note Note Note Note Note Note Note Note Note Note Note 14A Note 14B Note 15 Note Total
1
2
3
4
5
6
7
8
9
10
11
12
13
16
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance as at 1 January 2024 691 484 423 1,025 933 790 849 527 367 754 - - - - - - - 6,843
New loan notes issued 2,757 1,255 4,012
Equity Component of Conv. Loan (1,564) (107) (1,671)
Finance Charge 34 24 21 51 47 28 32 31 14 28 197 57 61 10 23 658
FX gain/loss (7) (5) (38) (50)
Fair Value Gain/Loss on Derecog. (2) 692 (12) 40 86 10 (16) 798
Restructuring of Loan (Note 13) (816) (546) (2,885) (1,291) 5,538 0
Restructuring of Loan (Note 14) (1,573) (421) (868) (72) 1,361 1,573 0
Balance as at 31 December 2024 725 508 444 1,076 980 - - - - - - - 4,035 1,333 1,489 - - 10,590
New Loan notes issued 2,500 2,500
Restructuring of Loan* 278 278
Finance Charge 37 21 21 52 47 253 40 90 79 14 654
FX gain/loss 80 80
Loans settled by issue of shares (529) (465) (1,128) (1,027) (22) (1,579) - - (4,750)
Balance as at 31 December 2025 762 - - - - - - - - - - - 4,266 1,453 - 2,579 292 9,352
Table 2 - Loan notes (Equity components)
Note Note Note Note Note Note Note Note Note Note Note Note Note Note 14A Note 14B Note 15 Note Total
1
2
3
4
5
6
7
8
9
10
11
12
13
16
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance as at 1 January 2024 386 270 237 579 557 - 177 - 57 118 - - - - - - - 2,381
Equity Component of Conv. Loan 1,564 107 1,671
Balance moved to retained earnings due to loan restructuring (177) (57) (118) **(352)
Balance as at 31 December 2024 386 270 237 579 557 - - - - - - - **1,564 - 107 - - 3,700
Reserve transferred to share capital - loans settled by issue of shares (270) (237) (579) (557) - - - - - - - (8) - (107) (1,758)
Balance as at 31 December 2025 386 - - - - - - - - - - - 1,556 - - - - 1,942
* During the year, the Group restructured certain loan notes with a carrying
value of £318k, which were classified as current borrowings in the prior
year. As part of this restructuring, the existing loan notes were extinguished
and replaced with new loan notes amounting to £278k issued to lenders. The
remaining balance of £40k, for which lender confirmation was not received,
was derecognised and recognised as a gain on extinguishment of financial
liabilities in the statement of profit or loss. Following the restructuring
and extension of maturity, the reissued loan notes have been classified as
non-current at 31 December 2025.
**In the prior year, an amount of (£352) relating to the balance moved to
retained earnings following loan restructuring was presented in an incorrect
column within Note 13 (Loans), resulting in the total being shown as £1,608
instead of £1,564. The presentation has been corrected in the current year
comparative disclosure, with no impact on the primary financial statements, as
the total was correctly stated.
Table 3 - Summary of Convertible Loan Note Terms
Note Ref Instrument name/series Investor / Party Instrument amounts Issue Date Maturity EIR Coupon rate Convertible? Conversion Price Classification Settled?
Note 1 Series 2 (unsecured, zero-coupon, convertible and transferable loan notes) Yang Jun £1,000,000 30 Jul 2021 30 Jul 2031 5% NA Yes £0.5458 Compound instrument No
Note 2 Series 1 (unsecured, zero-coupon, convertible and transferable loan notes) YA II PN, Ltd £700,000 30 Jul 2021 30 Jul 2031 5% NA Yes £0.6417 Compound instrument Yes
Note 3 Series 3 (unsecured, zero-coupon, convertible and transferable loan notes) Danir AB £612,260 30 Jul 2021 30 Jul 2031 5% NA Yes £0.10 Compound instrument Yes
Note 4 Series 4 (unsecured, zero-coupon, convertible and transferable loan notes) Danir AB £1,575,000 22 Oct 2021 22 Oct 2031 5% NA Yes £0.10 Compound instrument Yes
Note 5 Nil Coupon Convertible Loan notes 2031 Danir AB £3,800,900 9 Dec 2022 9 Dec 2032 5% NA Yes £0.15 Compound instrument Yes
Note 6,8,11 and 12 Loans 6, 8, 11 and 12 were merged prior to 31 Dec 2024 under a new Danir AB - - - - - - - - -
subscription agreement (Note 13).
Note 7,9,10 and 11 Notes 7, 9, 10 and 11, including £72k of interest, were consolidated into Danir AB - - - - - - - - -
Loan 14 prior to 31 Dec 2024 (Note 14).
Note 13 Subscription agreement to subscribe 92,298,539 shares in exchange of loans Danir AB £5,537,912 3 Oct 2024 16 May 2034 6.27% 3% Yes £0.06 Compound instrument No, not fully
Note 14A New Loan agreement 16 May 2025 Danir AB €1,586,700 3 Oct 2024 30 June 2027 N/A 3% No - Debt instrument No
Note 14B Danir AB £1,573,519 3 Oct 2024 30 June 2027 6.27% 3% Yes £0.70 Compound instrument Yes
Note 15 Subscription agreement 16 May 2025 Danir AB £2,500,000 16 May 2025 30 June 2027 N/A 5% No - Debt instrument No
Note 16 £306,599 unlisted, unsecured, 5% convertible and transferable loan notes 2027 Various £278,297 1 Jan 2025 a. Cash payment - 31 Dec 2027 N/A 5% Yes At the higher of £0.75 per share or a 25% discount to the 30-day VWAP. Debt instrument (Conversion option out-of-the-money; no derivative liability No
recognized.)
lenders b .Conversion to shares - Any time after Oct 2025
22. FINANCIAL LIABILITIES - CONTINGENT CONSIDERATION
The Group has entered into contractual arrangements that give rise to
contingent consideration liabilities linked to the development and operational
performance of two separate projects:
(a) Kaipola SPA Earn‑Out
Under the Share Purchase Agreement ("SPA") relating to the acquisition of
Kaipola, the Seller is entitled to an earn‑out of up to €3.85 million,
contingent on the Company's average EBITDA performance during the first five
years following the Commercial Operation Date. If the average EBITDA exceeds
€12,300k, the full earn-out is payable; for EBITDA between €7,400k and
€12,300k, a pro-rata amount is due. One‑third of the earn‑out is payable
in cash and two‑thirds through the issuance of new shares of Cindrigo
Holdings Limited at a 15% discount to the volume‑weighted average price
("VWAP") at the date EBITDA is certified by the auditors.
(b) German Projects - Milestone Bonus Arrangement
Under the investment agreement relating to three German projects, milestone
bonuses become payable upon achieving:
o Funding bonuses linked to BEW/KfW federal funding approvals
o Generating bonuses linked to achieving 22 MW average output across the
portfolio Maximum exposure across all projects is €5.5 million.
Further details of the contractual arrangements are provided in Note 6 -
Investment Agreement.
Both agreements were enforceable at 31 December 2025, and therefore
recognition is required at that date.
Fair Value Measurement (IFRS 13)
· Both liabilities are valued using an income approach, specifically a
probability‑weighted expected present value technique, consistent with IFRS
13.B10-B11.
· Both liabilities are classified as Level 3, due to significant
unobservable inputs.
· Key Inputs and Assumptions
o Probability distributions of EBITDA outcomes (Kaipola)
o Probability distributions of BEW/KfW funding and output performance
(German projects)
o Discount rates: 10-15% (Kaipola), 12-15% (German projects)
o VWAP discount (15%) and share‑settlement gross‑up (Kaipola)
o Expected settlement timing (2027-2029)
o Non‑performance risk incorporated via discount rate spreads
· Both liabilities are remeasured at each reporting date, with changes
in fair value recognised in profit or loss.
Recognised Amounts at 31 December 2025
2025 2024
£'000 £'000
Kaipola SPA Earn‑Out 2,249 -
German Projects Milestone Bonus 543 -
2,792 -
The maximum potential undiscounted amount payable under the contingent
consideration arrangements is £3.36m (€3.85m) in respect of the Kaipola
acquisition and £4.80m (€5.5m) in respect of the German acquisitions.
Movement in Contingent Consideration Liabilities
2025
£'000
Opening balance -
Initial recognition - Kaipola 2,249
Initial recognition - German projects 543
Closing balance 2,792
All initial recognition impacts were recorded in profit or loss.
Sensitivity Analysis
· Kaipola SPA Earn‑Out
Key sensitivities:
o EBITDA probability distribution sensitivity
Scenario Probability weighting Fair value (£'000)
Base case As modelled 2,249
-5% change in EBITDA probability distribution Adjusted probabilities 2,055
o Discount‑rate sensitivity:
Discount rate Fair value (£'000) % change
10.0% 2,470 9.88%
13.5% 2,249 0.0%
15.0% 2,162 -3.83%
· German Projects Milestone Bonus
o Discount‑rate sensitivity
Discount rate Fair value (£'000) % change
12.0% 1,137 +109.4%
13.5% 543 0.0%
15.0% 237 -56.4%
o Funding probability distribution
Scenario Probability weighting Fair value (£'000)
Base case As modelled 543
+5% change in funding probability distribution Adjusted probabilities 814
-5% change in funding probability distribution Adjusted probabilities 272
o Output probability distribution
Scenario Probability weighting Fair value (£'000)
Base case As modelled 543
+5% change in output probability distribution Adjusted probabilities 574
23. RECONCILIATION OF LIABILITIES ARISING FROM FINANCING ACTIVITIES
The changes in the Group's liabilities arising from financing activities can
be classified as follows:
Long-term borrowings Short-term borrowings Lease liabilities Total
£'000 £'000 £'000 £'000
1 January 2025 10,590 390 4,565 15,545
Cash-flows:
- Repayment - (77) (65) (142)
- Proceeds 2,500 - - 2,500
- Interest paid (financing cash flows) - - (293) (293)
Non-cash:
- Gain on Debt Extinguishment - (40) - (40)
- Creditors for repayments - - 51 51
- Settled by issue of shares (4,750) - - (4,750)
- Reclassification 278 (278) - -
- Interest expense 654 - 293 947
- FX gain/loss 80 5 216 301
31 December 2025 9,352 - 4,767 14,119
Long-term borrowings Short-term borrowings Lease liabilities Total
£'000 £'000 £'000 £'000
1 January 2024 - 7,667 - 7,667
Cash-flows:
- Repayment (65) (65)
- Proceeds 4,012 4,012
Non-cash:
- Restructuring of Loan Notes 8,472 (8,472) - -
- Reclassification (prior year corrections) 3,733 (3,733) - -
- Liability created - - 4,452 4,452
- Equity Component of Convertible Loan (1,671) - - (1,671)
- Settled by issue of shares - (497) - (497)
- Fair Value Gain/Loss - 859 - 859
- Finance Charge accrued 94 629 113 836
- FX gain/loss (38) (10) - (48)
31 December 2024 10,590 390 4,565 15,545
24. FINANCE INCOME AND COSTS
Finance costs for the reporting periods consist of the following:
2025 2024
£'000 £'000
Interest on loan notes 654 658
Interest on other loans - 65
Interest expense on lease arrangements 293 112
Interest expenses on trade payables 9 -
Total interest expense 956 835
Fair Value Loss on Loan Restructuring - 288
Total finance cost 956 1,123
Comparative finance costs for 2024 have been reduced by £1,553k following the
reclassification of loan arrangement costs to administrative expenses, to
better reflect their nature as transaction-related arrangement costs. This
reclassification has no impact on loss for the year, total equity, net assets,
or cash flows.
Finance income for the reporting periods consist of the following:
2025 2024
£'000 £'000
Gain on debt extinguishment 40 -
Total finance income 40 -
During the period, CL (100% Subsidiary) derecognized certain historical loan
liabilities that were no longer legally enforceable. Cindrigo Holdings Limited
subsequently issued new loan notes to the original lenders to compensate them.
In the process of derecognizing the liabilities and recording the
corresponding financial obligation in Cindrigo Holdings Limited, approvals
from some noteholders were not obtained. As a result, a gain on debt
extinguishment of £40k was recognized, reflecting the release of the legal
obligation. This gain has been presented under finance income in the statement
of comprehensive income.
25. TRADE AND OTHER PAYABLES
2025 2024
£'000 £'000
Trade payables 675 395
Accrued expense 302 88
Other payables 149 1,042
Total 1,126 1,525
All amounts are short term. The carrying values of trade and other payables
are considered to approximate their fair values.
The decrease in other payables primarily relates to deferred consideration
payable in respect of the Kaipola acquisition, which had an outstanding
balance of £1,035k at the beginning of the year and was fully settled during
the current year as follows:
Opening balance Cash settlement Gain on early settlement FX movement Closing balance
1,035 (867) (99) (69) 0
26. SHARE BASED PAYMENT
As at 31 December 2025, the Group operated a share-based payment scheme for
senior management and key consultants engaged by the Group. Under this
programme, options have been granted to key consultants, with a maximum term
ending on 1 January 2027.
Scheme Description
Under the scheme, options granted entitle the holder to subscribe for one
ordinary share at an exercise price of £0.05 per share. The options have a
contractual life of 10 years from the grant date. At 31 December 2025, the
weighted average remaining contractual life of options outstanding was 8.5
years.
Vesting Conditions and Period
The options vest in tranches as follows:
· 6,875,000 options vested in October 2024
· 6,150,000 options vested in June 2025
· 4,350,000 options vest in January 2027
Accordingly, the scheme contains service-based vesting conditions over a
period ending in January 2027.
Options granted under the scheme vest subject to the option holder remaining
in service with the Group until the relevant vesting date. There are no
market-based or non-market performance conditions attached to the options, and
vesting is dependent solely on the satisfaction of the service condition.
Measurement of Fair Value
The weighted average assumptions used in the model for measurement of fair
value were as follows:
· Expected volatility: 68%
· Risk-free interest rate: 3.95%
· Expected life: 5.26 years
· Dividend yield: 0%
· Share price at grant date: £0.06
· Exercise price: £0.05
The use of an option pricing model reflects the time value and optionality of
the instruments, in line with IFRS 2 requirements.
Expense Recognition
Total share-based payment expense recognised for the current year was £195k,
offset by £15k relating to forfeited options, resulting in a net charge of
£180k.
During the year, the Group identified an immaterial prior-period error in the
IFRS 2 fair value measurement of share options. A correction of £213k
relating to prior periods has been recognised in the current year in
accordance with IAS 8, as the amount was not considered material to require
restatement of comparative figures. Accordingly, the prior year share-based
payment expense originally reported as £674k is reduced to an adjusted amount
of £461k.
Forfeitures
At the grant date, management assessed the expected forfeiture rate as 0%,
reflecting the absence of historical forfeiture data and the fact that awards
were granted solely to directors, for whom turnover is historically low. This
estimate is reassessed at each reporting date.
During the year, 700,000 options were forfeited due to consultant leaving
before completing the vesting period. The impact of these forfeitures has been
recognised through a revision of the number of options expected to vest.
Movement in Share Options
Share options and weighted average exercise prices are as follows for the
reporting:
Number of Weighted average exercise price per share
shares
Outstanding at 1 January 2025 18,075,000 0.05
Granted
Forfeited (700,000) 0.05
Exercised - -
Outstanding at 31 December 2025 17,375,000 0.05
Exercisable at 31 December 2025 13,025,000 0.05
All options outstanding at the reporting date were granted in prior financial
periods. No new options were granted during the year, and narrative
disclosures throughout the financial statements are consistent with this
treatment.
The weighted average remaining contractual life of options outstanding was 8.5
years.
No options were exercised in 2025 and 2024.
Reconciliation to Share Option Reserve:
Amount
£'000
Opening balance 674
Less: Current‑year correction of prior‑period fair‑value error (IFRS 2) (213)
Add: Expense recognised in the year 195
Less: Lapsed/forfeited options (15)
Closing balance 641
During the year, the Group identified an error in the prior-year measurement
of the fair value of share options arising from the use of a valuation input
that did not comply with IFRS 2. As the impact of the error was assessed as
immaterial to prior periods, the correction of £213k has been recognised in
the current year and prior-year comparatives have not been restated.
In September 2025, the Board of Directors approved a share option scheme for
the potential grant of up to 17,144,630 share options to eligible
participants. As at 31 December 2025, no options had been granted and,
accordingly, no amounts have been recognised in these financial statements in
accordance with IFRS 2 Share-based Payment. This disclosure is provided on a
voluntary basis to highlight the potential future share-based payment
arrangement.
27. DIRECTORS' EMOLUMENTS
Directors received fees totalling £106k during the year (2024: £65k). At 31
December 2025, £2k (2024: nil) remained outstanding in respect of Jörgen
Andersson and is included within trade and other payables. No other amounts
were outstanding with related parties at the reporting date or in the prior
year.
In addition to directors' fees, consultancy fees of £300k (2024: £276k) were
paid in respect of services provided by the Chief Executive Officer, Chief
Financial Officer and Chief Commercial Officer. These services were provided
through director‑related service companies under contractual consultancy
arrangements entered into in the ordinary course of business and on terms
consistent with those applied to similar services provided to the Group. The
fees were recognised within administrative expenses. No amounts were
outstanding at the reporting date (2024: nil).
During the period, a one-off success bonus of £102k was paid to Directors in
connection with the listing of the Company. In the prior year, the Group
recognised share-based bonus payments totalling £720k in respect of
Directors.
During the period, termination benefits of £57k were paid to Mustaq Patel in
connection with his resignation, comprising £8k of directors' fees and £49k
of consultancy fees.
The Directors were the key management personnel of the Group.
28. TAXATION
Cindrigo Holdings Limited is a Company incorporated in Guernsey and is subject
to a corporate income tax rate of 0% as at 31 December 2025. Accordingly, no
current taxation arises on the Company's results for the year.
The Group operates through subsidiaries in a number of jurisdictions and is
therefore subject to taxation in the countries in which those subsidiaries
operate.
For the year ended 31 December 2025, none of the Group's subsidiaries
recognised a material tax liability, except for Kaipola, which recognised a
current tax charge of £5k (2024: £3k).
Reconciliation of tax expense
The tax charge for the year differs from the theoretical amount that would
arise using the Guernsey standard rate of income tax as follows:
2025 2024
£'000 £'000
Loss before taxation 6,850 11,457
Domestic tax rate - 0% 0% 0%
Expected tax expense - -
Tax effect of profits arising in overseas subsidiaries 5 3
Actual tax expense 5 3
Tax expense comprises:
- Current tax expense 5 3
Unrecognised deferred tax assets
At 31 December 2025, the Group had unused tax losses of £13,488k (2024:
£13,460k) available for offset against future taxable profits. These losses
arise in subsidiaries operating in taxable jurisdictions, primarily the United
Kingdom and Germany, and will be carried forward indefinitely.
Losses arising in the Group's Guernsey holding company have not been
separately tracked as they are not subject to tax and therefore do not give
rise to deferred tax assets.
No deferred tax asset has been recognised in respect of these losses at the
reporting date because the Directors consider that it is not probable that
sufficient future taxable profits will be available against which the losses
can be utilised.
Accordingly, the potential deferred tax benefit associated with these losses
has not been recognised in the consolidated financial statements.
29. EARNINGS PER SHARE
The calculation for earnings per share (basic and diluted) for the relevant
period is based on the profit / loss after income tax attributable to equity
holder for the period ending 31 December 2025 and is as follows:
31 December 2025
Loss for the year (£) (6,791,000)
Weighted average number of shares of £0.01 each 257,060,630
Loss per share basic (£) (0.026)
Weighted average number of shares for dilutive calculation 257,060,630
Loss per share diluted (£) (0.026)
31 December 2024
Loss for the year as (£) (10,987,000)
Weighted average number of shares of £2.667609 each 152,097,735
Loss per share basic (£) (0.072)
Weighted average number of shares for dilutive calculation 152,097,735
Loss per share diluted (£) (0.072)
Basic earnings per share is calculated by dividing the loss after tax
attributable to the equity holders of the Group by the weighted average number
of shares in issue during the year.
In accordance with IAS 33 Earnings per Share, the Group reports a loss for the
period, diluted earnings per share is equal to basic earnings per share, as
the inclusion of potential ordinary shares would be anti-dilutive.
Potential ordinary shares relating to 93,650,494 shares from convertible loan
notes, 22,837,372 shares from warrants, and 17,375,000 shares from stock
options have been excluded from the diluted earnings per share calculation, as
their inclusion would reduce the loss per share.
30. NON-CASH ADJUSTMENTS
Note 2025 2024
£'000 £'000
Impairment of financial assets - 5,488
Loan arrangement (Paid in shares) - 1,553
Consultant bonus payments (Paid in shares) - 775
Gain on settlement of purchase consideration 8 (99) -
Fair value losses 22 2,856 287
Interest expense 24 956 835
Gain on Debt extinguishment 24 (40) -
Depreciation and amortisation 229 93
Foreign exchange gains/losses 31 (49)
Share-based payment expenses 26 (33) 674
Total adjustment 3,900 9,656
31. RELATED PARTY TRANSACTIONS
The following payments were made to directors or entities controlled by them
during the current year:
Name of Director Directors Fees Payment made on resignation Share option expense Share option expense - previous year adjustment Consultant Bonus Consultant fees Total
IMM International - Lars Guldstrand 15,000 - 79,391 (90,509) 37,500 180,000 221,382
Fitzrovia Advisory - Mustaq Patel 12,944 56,500 21,655 (24,164) 20,000 90,839 177,774
Jorgen Andersson 22,000 - 25,196 (40,383) 10,000 - 16,813
Dag Andresen 15,000 - 24,525 (24,164) 20,000 30,000 65,361
Johan Glennmo 15,000 - 5,255 (2,124) 5,000 - 23,131
Alan Boyd 15,000 - 5,255 (2,124) 5,000 - 23,131
Jack Clipsham 10,625 - - - 5,000 - 15,625
Share option expense includes amounts recognised in the current year in
respect of prior periods. These are presented as 'previous year adjustment'
and have not been restated due to immateriality (refer to the share-based
payment note for further details).
The following payments were made to directors or entities controlled by them
during the previous year:
Name of Director Directors Fees Insurance Share option expense Consultant Bonus Consultant fees Total
IMM International - Lars Guldstrand 15,000 1,734 285,818 450,000 175,000 927,552
Fitzrovia Advisory - Mustaq Patel 15,000 - 76,309 15,000 86,350 192,659
Jorgen Andersson 22,000 - 127,527 230,000 - 379,527
Dag Andresen 15,000 - 76,309 15,000 35,000 141,309
Johan Glennmo 11,250 - 6,709 5,000 - 22,959
Alan Boyd 7,500 - 6,709 5,000 - 19,209
As at year-end, the outstanding balance of loans received from Danir AB
amounted to £8,298k (2024: £9,357k). Danir AB is a related party, holding
29% of the Company's issued share capital. The loan facility includes a
conversion option, allowing Danir to convert part or all of the outstanding
loan into equity of the Company; further details of the loans are provided in
Note 21 to the consolidated financial statements. All arrangements entered
into with Danir AB during the 2025 year of assessment were all arm's length
transactions at market related terms and conditions.
32. COMMITMENTS
The Group had not entered into any material commitments as of 31 December
2025.
33. CONTINGENT LIABILITIES
Further information regarding the Group's contingent liability is provided in
Note 22, which sets out the underlying terms and conditions of the
arrangement.
As disclosed in Note 22, the arrangement meets the definition of a financial
liability under IFRS Accounting Standards, and accordingly the Group has
recognised a financial liability in respect of this obligation. The remaining
exposure that does not meet the recognition criteria continues to be disclosed
as a contingent liability.
34. SUBSEQUENT EVENTS
Short‑Term Financing Support
After the year end, the Group received additional financial support from its
largest shareholder, Danir AB. Danir has provided guarantees in respect of a
short‑term loan facility of approximately £0.4 million to support the
Group's working capital requirements. This facility provides liquidity to the
Group during the post‑year‑end period.
Other non‑adjusting events
Agreed financing arrangements
Following the year end, the Group entered into a number of financing
arrangements to support its ongoing development activities. These agreements
were signed after the reporting date and therefore represent non‑adjusting
events under IAS 10. The key arrangements are as follows:
- £6.7 million equity investment into Cindrigo at a price of 12 pence
per share.
- €3 million been secured for the Fuelwood joint venture, this
amount plus a €1 million development loan from Cindrigo, a total of €4
million which is sufficient to support Fuelwoods establishment and initial
operational phase.
- Up to £2 million under a separate subscription arrangement, which
will be drawn if the Company's warrants due for exercise at the end of July
are not exercised.
No other adjusting or non‑adjusting events requiring disclosure have
occurred between the reporting date and the date of approval of these
financial statements.
35. ULTIMATE CONTROLLING PARTY
As of 31 December 2025, no one entity owns more than 50% of the issued share
capital. Therefore, the Group does not have an ultimate controlling party.
ENDS
Further Information on the Company
Following the Company's listing, Cindrigo has strengthened its strategic and
commercial position, enabling engagement with new investors and partners. The
Board views this investment as a coordinated strategic partnership aligning
capital, ownership and execution across the biomass value chain, supporting
disciplined delivery of the Group's biomass strategy and long-term expansion.
Fuelwood is developing a wood pellet production facility that will operate in
close integration with the Group's energy plant. Through its initial 20%
equity interest and Management Services Agreement, Cindrigo will play a
central role in the development and operation of the business.
The integrated model is expected to improve operational certainty, increase
utilisation of existing assets and infrastructure, and diversify revenue
streams across pellet production, industrial heat, steam and power sales. The
phased ramp-up model allows for controlled execution, with initial services
already underway and progressive increases in production and energy delivery
expected during 2026 and beyond.
Strong Market Demand
The Finnish biomass market continues to demonstrate strong underlying demand.
Structural changes in energy consumption, combined with increased availability
of feedstock and ongoing conversion from fossil fuels, are supporting growth
in wood pellet demand.
Fuelwood is expected to achieve an initial production capacity of
approximately 80,000 tpa by the end of 2026, with a long-term target of
approximately 400,000 tpa. At current market prices of approximately €240
per tonne, this represents a potential annual revenue of up to approximately
€100 million at full capacity. This would position Fuelwood as one of
Europe's largest sustainable wood pellet production facilities and a key
contributor to Europe's transition to sustainable energy.
Regional trading platforms for Finland reported an index price for spot
contracts for delivered wood pellets equivalent to approximately €240 per
tonne.
Balanced Growth Across Biomass and Geothermal
Biomass and geothermal are viewed as complementary components of the Group's
long-term strategy. Biomass provides a near-term solution for decarbonise
current fossil fuel sectors, while geothermal supports long-term energy
security through "always available" sustainable energy production.
While expanding its biomass activities, the Company also continues to advance
its geothermal licences in the Upper Rhine Valley, targeting a potential
combined capacity of approximately 300 MW across multiple projects.
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