REG - PipeHawk PLC - Final results for the year ended 30 June 2025
25/11/2025 07:00
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RNS Number : 7950I PipeHawk PLC 25 November 2025
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the UK Market Abuse
Regulation
25 November 2025
PipeHawk plc
("PipeHawk", "Company" or the "Group")
Final results for the year ended 30 June 2025
Highlights
- Group turnover was £3.7 million (2024: £9.1 million) a 27%
increase on turnover of £2.9 million generated from Pipehawk's ongoing core
businesses in 2024, which excludes QM Systems Ltd
- Group operating profit of £118,000 (2024: loss £1,215,000)
- Loss before taxation for the financial year of £310,000 (2024:
loss £1,639,000)
- Despite wider current market conditions, all divisions of the Group
are currently performing well
Chairman's statement for the year ended 30 June 2025
I can report that the Group's turnover for the financial year ended 30 June
2025 (the "Financial Year" or "2024/25 FY") was £3.7 million (2024: £9.1
million). The Group reported an operating profit in the Financial Year of
£118,000 (2024: loss £1,215,000), a loss before taxation for the Financial
Year of £310,000 (2024: loss £1,639,000) and a loss after taxation of
£259,000 (2024: loss £821,000). The loss per share for the Financial Year
was 0.71p (2024: loss per share 2.26p).
Well, that was another very challenging year! Obviously, there were
repercussions and fall out from the demise of QM Systems, but the remaining
teams and businesses have buckled down and grown remaining core turnover by
27% from £2.9 million to £3.7 million and I am confident that we shall
continue to grow and will have soon clawed our way back to profitability,
indeed on an EBITDA basis this year was positive to the tune of £207,000.
Whilst I was cautiously optimistic this time last year that our core
businesses were in the right industries which would be less affected by
private sector lack of confidence because they service the utilities,
government and rail industries, it sadly transpires that either funding has
been cut or delayed or, where it has been made available, there is significant
indecision on where and how to spend it. Accordingly, we are increasingly
looking to overseas markets to sell our products and expertise. This bodes
well for the future but does involve longer gestation periods.
Finally, I would like to pay tribute to all of our staff, subsidiary board
directors and main board directors for all their hard work and loyalty as we
strive to achieve further progress at each of our businesses. In particular, I
salute Randal MacDonnell, PipeHawk's highly respected and valued non-executive
director who sadly passed away in September, and whose advice, tenacity and
good humour will be sorely missed. We intend to appoint an additional
non-executive director to the Board in due course.
Thomson Engineering Design Ltd ("TED")
TED finished the year on a high, increasing its turnover from £1.14 million
to £1.77 million, growth of over 55% compared to 2024. This resulted in a
healthy post-tax profit of £156k (2024: loss £104k).
The partnership between TED and Unipart continues to flourish, with the
additional exposure and sales network Unipart brings to the partnership
through marketing strategies and exhibitions combined with TED's newly
developed High Output machinery and our other rail attachment offerings.
Exhibiting at the IAF exhibition show in Munster, Germany in May 2025 gained a
high footfall of potential clients with serious interest in our rail
equipment. Major interest is coming predominantly from Brazil, North America
and India, and the machine methodology is being embedded into high profile
infrastructure projects due to come to fruition in 2026.
TED also showcased its rail attachments and special purpose machinery at the
UK's largest rail event, Rail Live in June this year.
This led to sales leads and requests for quotes ("RFQs") of over £500k, some
of which are now entering our order book destined for maintenance work on the
London Underground Rail Network.
Transport for London and the London Underground have approved TED machinery to
be utilised for on-going and future maintenance projects.
The release of CP7 contracts to UK rail infrastructure for tier 1 and 2
contractors remains cautious and therefore our clients spend is being withheld
until they are guaranteed the work bank. However, RFQs remain steady even
though the gestation period for some RFQs is slow but seems to be gathering
momentum as renewals and maintenance projects are released and confidence
returns.
The outlook for 2026 and beyond is very positive.
Adien Ltd ("Adien")
The last financial year for Adien proved to be positive overall. The Adien
staff have settled well into their new premises and have managed to make a
number of efficiencies as a result.
Adien had a very strong start to the financial year with all teams at full
occupation throughout almost the whole six-month period. Unfortunately, the
second half of the year proved more difficult, with one very large
infrastructure project which had been scheduled to start in mid-January
getting progressively delayed until the end of spring. Adien had gone to great
lengths in planning and accommodating the project only for the proposed start
day to be delayed by three months. It then proved difficult to get full
utilisation out of the teams during that three-month period at very short
notice. Structural changes have been put in place to minimise the likelihood
of such instances occurring moving forward and, in the unlikely event that
they do, to mitigate their impact.
The project pipeline in 2025 has become somewhat difficult to navigate as a
number of sectors that were expecting to see reasonable growth indicated that
there will be little to no spend in 2025 and 2026. This primarily relates to
anything MOD and local council related. MOD has shelved virtually all plans
regarding barracks development/expansion or refurbishment. Likewise, there
were several plans in relation to town/city centre regeneration projects which
have also been shelved fully. There appears to be a lot of uncertainty and
lack of commitment within the construction industry as a whole currently.
However, on the positive side, Adien is doing well within the Telecoms, Water
and Power industries with reasonable year on year growth. This is where we
will continue our focus. Orders are strong here and have provided us with a
nearly complete programme of works until the end of the calendar year. Coupled
with our new CCTV division, it is anticipated that Adien will see good growth
in the next year.
Utsi Electronics Ltd ("Utsi")
Despite global events stretching both customer relationships and supply chain
timescales, throughout the year, as well as disrupting access to some regional
markets, our plan for growth has continued to deliver tangible results, with
turnover up over 30%, for the second year in succession, now bringing our
bottom line within touching distance of being positive. While UK market sales
have remained flat, sales to EU and ROW have been buoyant in comparison. As we
have continued to re-establish ourselves within existing markets, we have also
expanded the boundaries of our expertise into adjacent technologies, creating
new opportunities for sideward growth. Our fostering of deeper relationships
with our distribution chain; based on the prospect of mutual innovation -
mutual growth, has also begun to open new doors, to work with international
distributors, operating in allied fields, to provide additional customer
specific requirements. While the timely sourcing of materials remains a
concern. The future for Utsi continues to be bright and full of promise.
Financial position
The Group continues to be in a net liability position and is still reliant on
my continuing financial support.
My letter of support dated 26 November 2023 was renewed on 16 November 2025 to
provide the Group with financial support until 31 December 2026. Loans due to
me, other than those covered by the CULS (as defined below) agreement, are
unsecured and accrue interest at an annual rate of Bank of England base rate
plus 2.15%.
The Group's £1.0 million convertible unsecured loan stock issued to me (the
"CULS") was renewed on 30 June 2022 and extended on identical terms, such that
the CULS are now repayable on 13 August 2026. Further details of the CULS were
most recently announced by the Group on 26 September 2024.
In addition to the loans I have provided to the Company in previous years, I
have deferred a certain proportion of fees and the interest due on loans I
have provided until the Company is in a suitably strong position to make the
full payments. During the Financial Year, the deferred element of fees and
interest amounted to £259,000 and the aggregate amount of deferred fees and
interest outstanding to me as at the end of the Financial Year amounted to
approximately £2.0 million in total, all of which has been recognised as a
liability in the Company's accounts.
Strategy & Outlook
The Group remains committed to creating sustainable earnings-based growth and
focusing on the expansion of its business with forward-looking products and
services. PipeHawk acts responsibly towards its shareholders, business
partners, employees, society and the environment in each of its business
areas.
PipeHawk is committed to technologies and products that unite the goals of
customer value and sustainable development. Despite wider current market
conditions, all divisions of the Group are currently performing well, and I
remain optimistic in my outlook for the Group.
Gordon Watt
Executive Chairman
Date: 24 November 2025
Independent auditor's report for the year ended 30 June 2025
"Opinion
We have audited the financial statements of PipeHawk Plc (the "Parent
Company") and its subsidiaries (the "Group") for the year ended 30 June 2025
which comprise:
• Consolidated statement of comprehensive income
• Consolidated statement of financial position
and Parent company statement of financial position
• Consolidated statement of cash flow and Parent
company statement of cash flow
• Consolidated statement of changes in equity
and Parent company statement of changes in equity and
• the Notes to the financial statements,
including significant accounting policies
In our opinion, the financial statements:
• give a true and fair view of the state of the Group's affairs as at 30
June 2025 and of its loss for the year then ended.
• have been properly prepared in accordance with UK adopted international
accounting standards; and
• have been prepared in accordance with the requirements of the Companies
Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing
(UK) (ISAs (UK)) and applicable law. Our responsibilities under those
standards are further described in the Auditor's responsibilities for the
audit of the financial statements section of our report. We are independent of
the company in accordance with the ethical requirements that are relevant to
our audit of the financial statements in the UK, including the FRC's Ethical
Standard as applied to listed entities, and we have fulfilled our other
ethical responsibilities in accordance with these requirements. We believe
that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Conclusions relating to going concern
We draw attention to note 1 in the financial statements, which indicates that
due to the financial requirements of the Group and the Parent Company, the
Executive Chairman, G.G. Watt, will provide ongoing financial support for a
period of at least twelve months from the approval date of the financial
statements. These events and conditions indicate that a material uncertainty
exists that may cast significant doubt on the company's ability to continue as
a going concern. Our opinion is not modified in respect of this matter.
In auditing the financial statements, we have concluded that the director's
use of the going concern basis of accounting in the preparation of the
financial statements is appropriate.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Other information
The other information comprises the information included in the annual report,
other than the financial statements and our auditor's report thereon. The
directors are responsible for the other information contained within the
annual report. Our opinion on the financial statements does not cover the
other information and, except to the extent otherwise explicitly stated in our
report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the course of the audit, or otherwise
appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are required to
determine whether this gives rise to a material misstatement in the financial
statements themselves.
If, based on the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
• The information given in the strategic report and the report of the
directors for the financial year for which the financial statements are
prepared is consistent with the financial statements; and
• The strategic report and the report of the directors have been prepared in
accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its
environment obtained in the course of the audit, we have not identified
material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to
which the Companies Act 2006 requires us to report to you if, in our opinion:
• adequate accounting records have not been kept, or returns adequate for
our audit have not been received from branches not visited by us; or
• the financial statements are not in agreement with the accounting records
and returns; or
• certain disclosures of directors' remuneration specified by law are not
made; or
• we have not received all the information and explanations we require for
our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement set out
on page 12, the directors are responsible for the preparation of the financial
statements and for being satisfied that they give a true and fair view, and
for such internal control as the directors determine is necessary to enable
the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for
assessing the company's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the company or
to cease operations, or have no realistic alternative but to do so.
Auditors' responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these
financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and
regulations. We design procedures in line with our responsibilities, outlined
above, to detect material misstatements in respect of irregularities,
including fraud.
The extent to which our procedures are capable of detecting irregularities,
including fraud is detailed below:
Our approach to identifying and assessing the risks of material misstatement
in respect of irregularities, including fraud and non-compliance with laws and
regulations, was as follows:
• we identified the laws and regulations applicable to the company through
discussions with directors and other management, and from our commercial
knowledge and experience of the computer component manufacturing and supply
sector;
• we focused on specific laws and regulations which we considered may have a
direct material effect on the financial statements or the operations of the
company, including the Companies Act 2006 and taxation legislation;
• we assessed the extent of compliance with the laws and regulations
identified above through making enquiries of management and inspecting legal
correspondence; and
• identified laws and regulations were communicated within the audit team
regularly and the team remained alert to instances of non-compliance
throughout the audit.
We assessed the susceptibility of the company's financial statements to
material misstatement, including obtaining an understanding of how fraud might
occur, by:
• making enquiries of management as to where they considered there was
susceptibility to fraud, their knowledge of actual, suspected and alleged
fraud; and
• considering the internal controls in place to mitigate risks of fraud and
non-compliance with laws and regulations.
To address the risk of fraud through management bias and override of controls,
we:
• performed analytical procedures to identify any unusual or unexpected
relationships;
• tested journal entries to identify unusual transactions; and
• investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and
regulations, we designed procedures which included, but were not limited to:
• agreeing financial statement disclosures to underlying supporting
documentation;
• reading the minutes of meetings of those charged with governance;
• enquiring of management as to actual and potential litigation and claims.
There are inherent limitations in our audit procedures described above. The
more removed that laws and regulations are from financial transactions, the
less likely it is that we would become aware of non-compliance. Auditing
standards also limit the audit procedures required to identify non-compliance
with laws and regulations to enquiry of the directors and other management and
the inspection of regulatory and legal correspondence, if any.
A further description of our responsibilities is available on the Financial
Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This
description forms part of our auditor's report.
Material misstatements that arise due to fraud can be harder to detect than
those that arise from error as they may involve deliberate concealment or
collusion.
Use of our report
This report is made solely to the company's members, as a body, in accordance
with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been
undertaken so that we might state to the company's members those matters we
are required to state to them in an auditor's report and for no other purpose.
To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the company and the company's members as a
body, for our audit work, for this report, or for the opinions we have formed.
Signed by:
Sam Perkin BA ACA (Senior Statutory Auditor)
For and on behalf of Sedulo Audit Limited
Chartered Accountants
Statutory Auditor
St Paul's House
23 Park Square
Leeds
West Yorkshire
LS1 2ND
United Kingdom
Date: 24 November 2025"
Enquiries:
PipeHawk plc Tel. No. 01252 338 959
Gordon Watt (Chairman)
Allenby Capital Limited (Nomad and Broker) Tel. No. 020 3328 5656
David Hart / Vivek Bhardwaj
For further information on the Company and its subsidiaries, please visit:
www.pipehawk.com (http://www.pipehawk.com/)
Consolidated statement of comprehensive income
For the year ended 30 June 2025
30 June 2025 30 June 2024
Note
£'000 £'000
Revenue 2 3,743 9,138
Staff costs 5 (1,674) (4,954)
Impairment of goodwill - (163)
Operating costs (1,951) (5,236)
Operating profit/ (loss) 4 118 (1,215)
Profit/(Loss) before interest, taxation and exceptional items 118 (1,215)
Finance costs 3 (428) (424)
Loss before taxation (310) (1,639)
Taxation credit / (charge) 7 51 (52)
Loss before exceptional items (259) (1,691)
- 870
Exceptional items
Loss for the year attributable to equity holders of the parent
(259) (821)
Other comprehensive income -Revaluation reserve 141 -
Total comprehensive Loss for the year attributable to equity holder of the
parent
(118) (821)
Loss per share (pence) - basic 8 (0.71) (2.26)
Loss per share (pence) - diluted 8 (0.71) (2.26)
The notes form an integral part of these financial statements.
Consolidated statement of financial position
at 30 June 2025
30 June 2025 30 June 2024
Note £'000 £'000
Assets
Non-current assets
Property, plant and equipment 9 553 447
Right of use assets 10 187 189
Goodwill 11 - -
740 636
Current assets
Inventories 13 105 113
Current tax assets 51 80
Trade and other receivables 14 728 1,007
Cash and cash equivalents 15 95
899 1,295
Total assets 1,639 1,931
Equity and liabilities
Equity
Share capital 18 363 363
Share premium 5,316 5,316
Revaluation reserve 141 -
Retained earnings (12,211) (11,952)
(6,391) (6,273)
Non-current liabilities
Borrowings 16 3,663 3,780
Trade and other payables 15 - 121
3,663 3,901
Current liabilities
Borrowings 16 3,401 2,929
Trade and other payables 15 966 1,374
4,367 4,303
Total equity and liabilities 1,639 1,931
The notes form an integral part of these financial statements.
Consolidated statement of cash flow
For the year ended 30 June 2025
Note 30 June 2025 30 June 2024
£'000 £'000
Cash flows from operating activities
Operating Profit / (Loss) 118 (1,215)
Adjustments for:
Impairment of Goodwill - 163
Impairment of right of use assets - 347
Depreciation 170 619
288 (86)
Decrease / (increase) in inventories 8 65
Decrease / (increase) in receivables 279 271
(Decrease) / increase in liabilities (369) (1,002)
Cash generated from operations / (used in) 206 (752)
Interest paid (169) (173)
Corporation tax received 80 695
Net cash generated from / (used in) operating activities 117 (230)
Cash flows from investing activities
Purchase of fixed assets (18) (50)
Net cash used in investing activities (18) (50)
Cash flows from financing activities
Proceeds / (Repayments) from borrowings 28 30
Repayments of loan (242) (544)
Proceeds of loan 165 1,313
Repayment of leases (130) (572)
Net cash (used in) / generated from financing activities (179) 227
Net decrease in cash and cash equivalents (80) (53)
Cash and cash equivalents at the beginning of year 95 148
Cash and cash equivalents at the end of year 15 95
The notes form an integral part of these financial statements.
Statement of changes in equity
For the year ended 30 June 2025
Share premium account Retained earnings Revaluation Reserve
CONSOLIDATED Share capital Total
£'000 £'000 £'000 £'000 £'000
As at 1 July 2023 363 5,316 (11,131) - (5,452)
Loss for the year - - (821) - (821)
Total comprehensive income - - (821) - (821)
As at 30 June 2024 363 5,316 (11,952) - (6,273)
Loss for the year - - (259) - (259)
- - - 141 141
Revaluation gain
Total comprehensive income - - (259) 141 (118)
As at 30 June 2025 363 5,316 (12,211) 141 (6,391)
The share premium account reserve arises on the issuing of shares. Where
shares are issued at a value that exceeds their nominal value, a sum equal to
the difference between the issue value and the nominal value is transferred to
the share premium account reserve.
The notes form an integral part of these financial statements.
1 Summary of material accounting policies
1.1. General information
PipeHawk plc (the "Company" or the "Group") is a public limited company
incorporated in the England and Wales under the Companies Act 2006. The
addresses of its registered office and principal place of business are
disclosed in the company information section on page 1. The principal
activities of the Company and its subsidiaries (the Group) are described on
page 7.
The financial statements are presented in pounds sterling, the functional
currency of all companies in the Group. In accordance with section 408 of
the Companies Act 2006 a separate statement of comprehensive income for the
parent Company has not been presented.
1.2. Basis of preparation
The financial statements have been prepared in accordance with UK-adopted
international accounting standards (IAS) The principal accounting policies are
set out below.
Adoption of new and revised standards
A number of new standards and amendments to standards and interpretations have
been issued but are not yet effective and, in some cases, have not yet been
adopted by the UK. The directors do not expect that the adoption of these
standards will have a material impact on the financial statements of the
Company and Group in future periods.
1.3. Basis of preparation - Going concern
The directors have reviewed the Parent Company and Group's funding
requirements for the next twelve months which show positive anticipated cash
flow generation, prior to any repayment of loans advanced by the Executive
Chairman. The preparation of cash flow forecasts for the Group requires
estimates to be made of the quantum and timing of cash receipts from future
commercial revenues and the timing of future expenditure. The board consider
that the challenging political, economic and financial backdrop in the UK
presents uncertainties for the group to achieve its revenue growth forecasts.
The directors have obtained a renewed pledge from G G Watt to provide ongoing
financial support including additional funding if required for a period of at
least twelve months from the approval date of the Group and Parent Company
statement of financial positions. The directors therefore have a reasonable
expectation that the entity has adequate resources to continue in its
operational exercises for the foreseeable future. It is on this basis that the
directors consider it appropriate to adopt the going concern basis of
preparation within these financial statements. However, a material uncertainty
exists regarding the ability of the Group and Parent Company to remain a going
concern without the continuing financial support of the Executive Chairman.
The financial statement does not include adjustments which would arise in the
event of not being a going concern.
1.4. Basis of consolidation
The consolidated financial statements incorporate the financial statements of
the Company and entities controlled by the Company (its subsidiaries). Control
is achieved where the Company has the power to govern the financial and
operating policies of an entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are
included in the consolidated statement of comprehensive income from the
effective date of acquisition or up to the effective date of disposal, as
appropriate. Where necessary, adjustments are made to the financial statements
of subsidiaries to bring their accounting policies into line with those used
by other members of the Group. All intra-group transactions, balances, income
and expenses are eliminated in full on consolidation.
1.5. Business combinations
Acquisitions of subsidiaries and businesses are accounted for using the
acquisition method. The cost of the business combination is measured as the
aggregate of the fair values (at the date of exchange) of assets given,
liabilities incurred or assumed, and equity instruments issued by the Group in
exchange for control of the acquiree. The acquiree's identifiable assets,
liabilities and contingent liabilities that meet the conditions for
recognition under IFRS 3 Business combinations.
Goodwill arising on acquisition is recognised as an asset and initially
measured at cost, being the excess of the cost of the business combination
over the Group's interest in the net fair value of the identifiable assets,
liabilities and contingent liabilities recognised.
1.6. Goodwill
Goodwill is initially recognised as an asset at cost and is subsequently
measured at cost less any accumulated impairment losses.
For the purpose of impairment testing, goodwill is allocated to each of the
Group's cash-generating units expected to benefit from the synergies of the
combination. Cash-generating units to which goodwill has been allocated are
tested for impairment annually, or more frequently when there is an indication
that the unit may be impaired.
If the recoverable amount of the cash-generating unit is less than the
carrying amount of the unit, the impairment loss is allocated first to reduce
the carrying amount of any goodwill allocated to the unit and then to the
other assets of the unit pro-rata on the basis of the carrying amount of each
asset in the unit. An impairment loss recognised for goodwill is not
reversed in a subsequent period.
On disposal of a subsidiary, the attributable amount of goodwill is included
in the determination of the profit or loss on disposal.
1.7. Revenue recognition
Revenue from the sale of goods and services are recognised as control
transfers to the customer in accordance with the principles of IFRS 15 as
follows:
Identify the contract with the customer
A legally enforceable contract is entered into with a customer for the
construction of a piece of equipment, or for the design and preparation of
complete software and hardware test solutions and the provision of specialist
surveying.
Identify the performance obligation
The performance obligation for the sale of goods is the construction and
delivery of the specified equipment as per the contractual agreement and is
satisfied over time as the work progresses.
The performance obligation for the sale of services is the design and
preparation of complete software and hardware test solutions and the provision
of specialist surveying as per the contractual agreement and is satisfied over
time as the work progresses and control transfers to the customer.
Determine transaction price
The transaction price is the amount of consideration the Company expected to
be entitled to in exchange for transferring the promised equipment to the
customer. This includes fixed contract prices, and where applicable, estimated
variable consideration, which is only included to the extent that it is highly
probably that a significant reversal in the amount of cumulative revenue
recognised will not occur.
Allocate the transaction price
A revenue contract contains a single performance obligation with no separately
satisfiable obligations. Therefore, the contract value is the transaction
price.
Recognise revenue
Revenue is recognised over time as control passes to the customer. Revenue
invoices are raised to the customer on a stage of completion basis, or on
shorter term projects invoices are issued on completion. Where this results in
a timing difference between revenue invoiced and revenue allowed a resulting
contract asset or contract liability is recognised on the balance sheet.
Contract asset: When the company has incurred actual direct costs beyond the
point of which revenue invoices have been raised, a contract asset is
recognised for the amount of actual direct costs in excess of total revenue
invoices raised.
Contract liabilities: When the company has invoiced the customer at a stage of
completion beyond the point of which actual direct costs have been incurred, a
contract liability is recognised for the amount which aggregate revenue
invoices raised exceeds the amount of actual direct costs incurred.
1.8. Property, plant and equipment
Property is valued on a fair value basis, plant and equipment are stated at
cost less accumulated depreciation and accumulated impairment losses.
Depreciation is charged so as to write off the cost of assets over their
estimated useful lives, using the straight-line method. The estimated useful
lives, residual values and depreciation method are reviewed at each year end,
with the effect of any changes in estimate accounted for on a prospective
basis. Assets held under leases are depreciated over their expected useful
lives on the same basis as owned assets or, where shorter, the term of the
relevant lease. Gains and losses on disposals are determined by comparing the
proceeds with the carrying amount and are recognised within the Statement of
Comprehensive Income.
The principal annual rates used to depreciate property, plant and equipment
are:
Freehold land and buildings 1% /
2%
Equipment, fixtures and fittings 20% / 25%
Motor vehicles
25%
1.9. Inventories and work in progress
Inventories are stated at the lower of cost and net realisable value. Costs,
including an appropriate portion of fixed and variable overhead expenses, are
assigned to inventories by the method most appropriate to the particular class
of inventory, with the majority being valued on a first-in-first-out basis.
Net realisable value represents the estimated selling price for inventories
less all estimated costs of completion and costs necessary to make the sale.
Work in progress is valued at cost, which includes expenses incurred on behalf
of clients and an appropriate proportion of directly attributable costs on
incomplete assignments. The value of work in progress is reduced where
appropriate to provide for irrecoverable costs
.
1.10. Financial assets
The Group's financial assets consist of cash and cash equivalents and trade
and other receivables. The Group's accounting policy for each category of
financial asset is as follows:
Financial assets held at amortised cost
Trade receivables and other receivables are classified as financial assets
held at amortised cost. They are initially recognised at fair value plus
transaction costs that are directly attributable to their acquisition or issue
and are subsequently carried at amortised cost using the effective interest
rate method, less provision for impairment.
Impairment provisions are recognised based on its historical credit loss
experience, adjusted for forward-looking factors specific to the debtors and
the economic environment, the amount of such a provision being the difference
between the net carrying amount and the present value of the future expected
cash flows associated with the impaired receivable. For receivables, which are
reported net, such provisions are recorded in a separate allowance account
with the loss being recognised within administrative expenses in the statement
of comprehensive income. On confirmation that the receivable will not be
collectable, the gross carrying value of the asset is written off against the
associated provision.
The Group's financial assets held at amortised cost comprise other receivables
and cash and cash equivalents in the statement of financial position.
Derecognition of financial assets
The Group derecognises a financial asset only when the contractual rights to
the cash flows from the asset expire; or it transfers the financial asset and
substantially all the risks and rewards of ownership of the asset to another
entity.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the
assets of an entity after deducting all of its liabilities. Equity instruments
issued by the Group are recorded at the proceeds received, net of direct issue
costs.
Financial liabilities
Financial liabilities, including borrowings, are initially measured at fair
value, net of transaction costs. Financial liabilities are subsequently
measured at amortised cost using the effective interest method, with interest
expense recognised on an effective yield basis.
The effective interest method is a method of calculating the amortised cost of
a financial liability and of allocating interest expense over the relevant
period. The effective interest rate is the rate that exactly discounts
estimated future cash payments through the expected life of the financial
liability, or, where appropriate, a shorter period.
Derecognition of financial liabilities
The Group derecognises financial liabilities when, and only when, the Group's
obligations are discharged, cancelled or they expire.
1.11. Leased/Right of Use assets
The leases liability is initially measured at
the present value of the remaining lease payments, discounted using the
individual entities incremental borrowing rate. The lease term comprises the
non-cancellable period of the contract, together with periods covered by an
option to extend the lease where the Group is reasonably certain to exercise
that option based on operational needs and contractual terms. Subsequently,
the lease liability is measured at amortised cost by increasing the carrying
amount to reflect interest on the lease liability, and reducing it by the
lease payments made. The lease liability is remeasured when the Group changes
its assessment of whether it will exercise an extension or termination option.
Right-of-use assets are initially measured at cost, comprising the initial
measurement of the lease liability adjusted for any lease payments made at or
before the commencement date, lease incentives received and initial direct
costs. Subsequently, right-of-use assets are measured at cost, less any
accumulated depreciation and any accumulated impairment losses, and are
adjusted for certain remeasurement of the lease liability.
Depreciation is calculated on a straight-line basis over the length of the
lease. The Group has elected to apply exemptions for short-term leases and
leases for which the underlying asset is of low value. For these leases,
payments are charged to the income statement on a straight-line basis over the
term of the relevant lease. Right-of-use assets are presented within
non-current assets on the face of the statement of financial position, and
lease liabilities are shown separately on the statement of financial position
in current liabilities and non-current liabilities depending on the maturity
of the lease payments.
Under IFRS16, right-of-use assets will be tested for impairment in accordance
with IAS36 Impairment of Assets.
Payments associated with short-term leases are recognised on a straight-line
basis as an expense in the profit or loss. Short term leases are leases with a
lease term of 12 months or less.
1.12. Pension scheme contributions
Pension contributions are charged to the statement of comprehensive income in
the period in which they fall due. All pension costs are in relation to
defined contribution schemes.
1.13. Share based payments
Equity-settled share-based payments to employees and others providing similar
services are measured at the fair value of the equity instruments at the grant
date. Details regarding the determination of the fair value of
equity-settled share-based transactions are set out in note 18.
The fair value determined at the grant date of the equity-settled share-based
payments is expensed on a straight-line basis over the vesting period, based
on the Group's estimate of equity instruments that will eventually vest. At
each statement of financial position date, the Group revises its estimate of
the number of equity instruments expected to vest. The impact of the revision
of the original estimates, if any, is recognised in profit or loss over the
remaining vesting period, with a corresponding adjustment to reserves.
1.14. Foreign currencies
Monetary assets and liabilities denominated in foreign currencies are
translated into sterling at the rates of exchange ruling at 30 June.
Transactions in foreign currencies are recorded at the rates ruling at the
date of the transactions, and processed through the profit & loss account.
1.15. Taxation
Income tax expense represents the sum of the tax currently payable and
deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable
profit differs from profit as reported in the consolidated statement of
comprehensive income because it excludes items of income or expense that are
taxable or deductible in other years and it further excludes items that are
never taxable or deductible. The Group's liability for current tax is
calculated using tax rates that have been enacted or substantively enacted by
the year end date.
Deferred tax
Deferred tax is recognised on differences between the carrying amounts of
assets and liabilities in the financial statements and the corresponding tax
bases used in the computation of taxable profit, and is accounted for using
the statement of financial position liability method. Deferred tax liabilities
are generally recognised for all taxable temporary differences, and deferred
tax assets are generally recognised for all deductible temporary differences
to the extent that it is probable that taxable profits will be available
against which those deductible temporary differences can be utilised. Such
assets and liabilities are not recognised if the temporary difference arises
from goodwill or from the initial recognition (other than in a business
combination) of other assets and liabilities in a transaction that affects
neither the taxable profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences
associated with investments in subsidiaries and associates, and interests in
joint ventures, except where the Group is able to control the reversal of the
temporary difference and it is probable that the temporary difference will not
reverse in the foreseeable future. Deferred tax assets arising from
deductible temporary differences associated with such investments and
interests are only recognised to the extent that it is probable that there
will be sufficient taxable profits against which to utilise the benefits of
the temporary differences and they are expected to reverse in the foreseeable
future.
The carrying amount of deferred tax assets is reviewed at each statement of
financial position date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or
part of the asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are
expected to apply in the year in which the liability is settled or the asset
realised, based on tax rates (and tax laws) that have been enacted or
substantively enacted by the year end date. The measurement of deferred tax
liabilities and assets reflects the tax consequences that would follow from
the manner in which the Group expects, at the reporting date, to recover or
settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset when there is a legally
enforceable right to set off current tax assets against current tax
liabilities and when they relate to income taxes levied by the same taxation
authority and the Group intends to settle its current tax assets and
liabilities on a net basis.
Current and deferred tax for the year
Current and deferred tax are recognised as an expense or income in the
statement of comprehensive income, except when they relate to items credited
or debited directly to equity, in which case the tax is also recognised
directly in equity.
1.16. Impairment of property, plant and equipment
At each year end date, the Group reviews the carrying amounts of its property,
plant and equipment to determine whether there is any indication that those
assets have suffered an impairment loss. If any such indication exists, the
recoverable amount of the asset is estimated in order to determine the extent
of the impairment loss (if any). Where it is not possible to estimate the
recoverable amount of an individual asset, the Group estimates the recoverable
amount of the cash-generating unit to which the asset belongs. Where a
reasonable and consistent basis of allocation can be identified, corporate
assets are also allocated to individual cash-generating units, or otherwise
they are allocated to the smallest group of cash-generating units for which a
reasonable and consistent allocation basis can be identified.
Recoverable amount is the higher of fair value less costs to sell and value in
use. In assessing value in use, the estimated future cash flows are discounted
to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the
asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated
to be less than its carrying amount, the carrying amount of the asset (or
cash-generating unit) is reduced to its recoverable amount. An impairment loss
is recognised immediately in profit or loss.
Where an impairment loss subsequently reverses, the carrying amount of the
asset (or cash-generating unit) is increased to the revised estimate of its
recoverable amount, but so that the increased carrying amount does not exceed
the carrying amount that would have been determined had no impairment loss
been recognised for the asset (or cash-generating unit) in prior years. A
reversal of an impairment loss is recognised immediately in the statement of
comprehensive income.
1.17. Research and development
The Group undertakes research and development to expand its activity in
technology and innovation to develop new products that will begin directly
generating revenue in the future. Expenditure on research is expensed as
incurred, development expenditure is capitalised only if the criteria for
capitalisation are recognised in IAS 38. The Company claims tax credits on its
research and development activity and recognises the income in current tax.
1.18. Government grants
During the period, the Group received benefits from Government grants
totalling £ nil (2024: 18,000).
1.19. Critical judgement in applying accounting policies and key sources of
estimation uncertainty
The following are the critical judgements and key sources of estimation
uncertainty that the directors have made in the process of applying the
entity's accounting policies and that have the most significant effect on the
amounts recognised in these financial statements.
The estimates and associated assumptions are based on historical experience
and other factors that are considered to be relevant. Actual results may
differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognised in the period in which the
estimate is revised if the revision affects only that period, or in the period
of the revision and future periods if the revision affects both current and
future periods.
Critical judgements in applying the Group's accounting policies
The following are the critical judgement/s, apart from those involving
estimations that the directors have made in the process of applying the
Group's accounting policies and that have the most significant effect on the
amounts recognised in the financial statements.
Revenue recognition
PipeHawk consolidated accounts operate under IFRS 15 which adopts the
following approach to recognising revenue.
Revenue on long-term projects is recognised on the percentage of completion
method (unless a loss is forecast on that project), they state the significant
risks and rewards are transferred and that the recognition of revenue over the
duration of a contract is appropriate as enforceable contracts are in place.
Each project is customer specific and has an enforceable contract. Throughout
the project each project is assessed individually by the management to
ascertain the percentage of revenue recognised and this is continually updated
throughout the project. As each project is specific to customer and we can
enforce the contract, we have applied percentage complete basis at year end
rather than transfer of significant risks and rewards basis of ownership. The
directors are satisfied that percentage completion remains the appropriate
critical judgement.
Key source of estimation uncertainty
The key assumption concerning estimation at the balance sheet date, with a
risk of causing any adjustment to carrying amounts in the assets and
liabilities within the next financial year, would be in relation to the
valuations of the properties owned by the group.
The management believe the current estimates are accurate based on revaluation
and are now more in line with their true value. The buildings are an integral
part of the businesses future as going concerns, and there is currently no
plan to sell, so therefore the risk is not deemed as significant.
Going concern
The preparation of cash flow forecasts for the Group requires estimates to be
made of the quantum and timing of cash receipts from future commercial
revenues and the timing of future expenditure, all of which are subject to
uncertainty, see Basis of preparation - Going concern note 1.3
2 Segmental analysis
2025 2024
£'000 £'000
Turnover by geographical market
United Kingdom 3,296 8,739
Europe 49 82
Other 398 317
3,743 9,138
The Group operates out of one geographical location being the UK. Accordingly,
the primary segmental disclosure is based on activity. Per IFRS 8 operating
segments are based on internal reports about components of the Group, which
are regularly reviewed and used by Chief Operating Decision Maker ("CODM"),
the current executive chairman, for strategic decision making and resource
allocation, in order to allocate resources to the segment and to assess its
performance. The Group's reportable operating segments are as follows:
· Adien Limited - Utility detection and mapping services - Sale of
services
· Utsi Electronics Limited - Development, assembly and sale of GPR
equipment - Sale of goods
· Thomson Engineering Design Limited - Rail trackside solutions
(included in the test system solutions segment) - Sale of services
· Wessex Precision Instruments Limited - Non trading
The CODM monitors the operating results of each segment for the purpose of
performance assessments and making decisions on resource allocation.
Performance is based on revenue generations and profit before tax, which the
CODM believes are the most relevant in evaluating the results relative to
other entities in the industry.
Information regarding each of the operations of each reportable segment is
included below, all non-current assets owned by the Group are held in the UK.
Utility detection and mapping services Development, assembly and sale of GPR equipment Automation and test system solutions
Total
£'000 £'000 £'000 £'000
Year ended 30 June 2025
Total segmental revenue 1,537 433 1,773 3,743
Operating (loss) / profit 68 (114) 164 118
Finance costs (53) (350) (25) (428)
(Loss) / Profit before taxation 15 (464) 139 (310)
Segment assets 612 430 597 1,639
Segment liabilities 659 6,510 878 8,047
Non-current asset additions 3 - 15 18
Revaluation reserve-property - 93 48 141
Depreciation and amortisation 44 17 109 170
Utility detection and mapping services Development, assembly and sale of GPR equipment Automation and test system solutions
Total
£'000 £'000 £'000 £'000
Year ended 30 June 2024
Total segmental revenue 1,448 330 7,360 9,138
Operating (loss) / profit 85 154 (1,454) (1,215)
Finance costs (35) (335) (54) (424)
(Loss) / Profit before taxation 50 (181) (1,508) (1,639)
Segment assets 497 322 1,112 1,931
Segment liabilities 579 6,319 1,220 8,118
Non-current asset additions 48 - 47 95
Depreciation and amortisation 60 18 541 619
3 Finance costs
2025 2024
£'000 £'000
Interest payable 428 424
428 424
Interest payable comprises interest on:
Leases 11 23
Directors' loans 259 259
Other 158 142
428 424
4 Operating profit for the year
This is arrived at after charging for the Group:
2025 2024
£'000 £'000
Research and development costs not capitalised 611 602
Depreciation and amortisation 170 619
Impairment of goodwill - 163
Impairment of stock recognised as an expense 7 10
Auditor's remuneration
Fees payable to the Company's auditor for the audit of the Group's financial
statements
33 53
Fees payable to the Company's auditor and its subsidiaries for the provision
of tax services
5 -
The Company's audit fee is £18,000 (2024: £29,000).
5 Staff costs
Group 2025 2024
No. No.
Average monthly number of employees, including directors:
Production and research 33 89
Selling and research 5 9
Administration 9 10
47 108
Group 2025 2024
£'000 £'000
Staff costs, including directors:
Wages and salaries 1,454 4,313
Social security costs 143 414
Other pension costs 77 227
1,674 4,954
Company 2025 2024
No. No.
Average monthly number of employees, including directors:
Selling and research - -
Administration 1 1
1 1
Company 2025 2024
£'000 £'000
Staff costs, including directors:
Wages and salaries 124 82
Social security costs - -
Other pension costs - -
124 82
6 Directors' remuneration
Salary Benefits 2025 2024
and fees in kind Total Total
£'000 £'000 £'000 £'000
G G Watt 71 - 71 71
R MacDonnell 2 - 2 2
T Williams 10 - 10 9
Aggregate emoluments 83 - 83 82
2025 2024
Directors' pensions
No. No.
The number of directors who are accruing retirement benefits under:
Defined contributions policies - -
The directors represent key management personnel.
Refer to note 18 for details of directors share options.
7 Taxation
2025 2024
£'000 £'000
United Kingdom Corporation Tax
Current taxation (51) (68)
Adjustments in respect of prior years - 120
(51) 52
Deferred taxation - -
Tax on loss (51) 52
Current tax reconciliation
Taxable loss for the year (310) (1,639)
Theoretical tax at UK corporation tax rate 19% (2024: 19%) (59) (383)
Effects of:
R&D tax credit (99) (38)
adjustments
Fixed asset timing differences 1 4
Not deductible for tax purposes 8 259
Impairment of goodwill - (31)
Deferred tax not recognised 98 229
Adjustments in respect of prior years - 120
Utilisation of losses - 1
Short term timing differences - (109)
Total income tax (credit) / charge
( 51) 52
The Group has tax losses amounting to approximately £3,293,000 (2024:
£3,807,000), available for carry forward to set off against future trading
profits. No deferred tax assets have been recognised in these financial
statements due to the uncertainty regarding future taxable profits.
Potential deferred tax assets not recognised are approximately £626,000
(2024: £723,000).
8 Loss / profit per share
Group
Basic (pence per share) 2025 - Loss (0.71) per share; 2024 - Loss (2.26) per
share
The loss has been calculated based on the net loss of £259,000 (2024: Loss
£821,000) and the number of shares used was 36,312,823 (2024: 36,312,823)
being the weighted average number of shares in issue during the year.
The net loss does not include the revaluation gain on the Group's property
portfolio, which has been recognised in other comprehensive income and is
therefore not a factor in the calculation of loss per share.
Diluted (pence per share) 2025 - (0.71) loss per share; 2024 - (2.26) loss per
share
In the current year the potential ordinary shares included in the weighted
average of shares are anti-dilutive and therefore diluted earnings per share
is equal to basic earnings per share.
9 Property, plant and equipment
Group Equipment, fixtures and fittings
Leasehold improvements Motor vehicles
Freehold Total
£'000 £'000 £'000 £'000 £'000
Cost
At 1 July 2024 375 1,139 21 292 1,827
Additions - 18 - - 18
Revaluation gain 81 - - - 81
Transfer from right of use assets - - 23 - 23
Disposals - (733) - (134) (867)
At 30 June 2025 456 424 44 158 1,082
Depreciation
At 1 July 2024 4 1,087 - 289 1,380
Charged in year 4 44 11 3 62
Revaluation depreciation reversal (60) - - - (60)
Disposals - (733) - (134) (867)
Transfer from right of use assets - 3 11 - 14
At 30 June 2025 (52) 401 22 158 529
Net book value
At 30 June 2025 508 23 22 - 553
At 30 June 2024 371 52 21 3 447
10 Right of use
Group Equipment, fixtures and fittings
Leasehold improvements Motor vehicles
Property Total
£'000 £'000 £'000 £'000 £'000
Cost
At 1 July 2024 192 449 168 23 832
Additions 115 - - - 115
Transfer to property, plant and equipment - - (23) - (23)
Disposal - - - - -
At 30 June 2025 307 449 145 23 924
Depreciation
At 1 July 2024 66 415 156 6 643
Charged in year 82 20 - 6 108
Transfer to property, plant and equipment - (3) (11) - (14)
Disposal - - - - -
At 30 June 2025 148 432 145 12 737
Net book value
At 30 June 2025 159 17 - 11 187
At 30 June 2024 126 34 12 17 189
These assets have been offered as security in respect of these lease
agreements. Depreciation charged in the period on those assets amounted to
£108,000 (2024: £449,000)
11 Goodwill
Group Goodwill Total
£'000 £'000
Cost
At 1 July 2024 1,357 1,357
Additions - -
At 30 June 2025 1,357 1,357
Impairment
As at 30 June 2024 (1,357) .(1,357)
Additional impairment - -
Net book value
At 30 June 2025 - -
At 30 June 2024 - -
The goodwill brought forward in the statement of financial position at 30 June
2024 was £ nil.
We consider the CGUs to be the entities as acquired under business
combinations and managed as separate legal entities, each representing a
separately identifiable and independent group of assets contributing to the
cash flows of the CGU.
· Adien Limited specialises in leading edge detection systems in
the field of utilities detection.
· Thomson Engineering Design produces an unparalleled range of
machines, attachments and tools for railway track maintenance.
· Utsi design & manufacturer of innovative Ground Penetrating
Radar (GPR) systems which are used for commercial and
Industrial applications, all over the world.
12 Non-current investments
Company
Investment in subsidiaries Total
Investment in subsidiaries
£'000 £'000
Cost
At 1 July 2024 1,903 1,903
Additions - -
At 30 June 2025 1,903 1,903
Impairment
Provided at 30 June 2024 (1,903) (1,903)
Additional impairment - -
Net book value
At 30 June 2025 - -
At 30 June 2024 - -
Parent and Group interest in ordinary shares and voting rights
Country of incorporation
Subsidiary Principal activity
Adien Ltd 100% England & Wales Specialist surveying
Thomson Engineering Design Ltd 100% England & Wales Specialist in railway equipment
Wessex Precision Instruments Ltd 100% England & Wales Slip test solutions
Utsi Electronics Ltd 100% England & Wales GPR equipment
Wessex Test Equipment Ltd 100% England & Wales Dormant
CE Marking Services Ltd 100% England & Wales Dormant
An impairment assessment was performed in line with the assessment of
goodwill, see note 11 for further details.
The registered office of all of the above named subsidiaries, except Adien Ltd
and Utsi Electronics Ltd is Units 2a & 3 Crabtree Road, Forest Vale
Industrial Estate, Cinderford, Gloucestershire, United Kingdom, GL14 2YQ.
The registered office of Adien Ltd is Derek Lewis Building, Millfield Ind
Estate, Bentley, Doncaster, DN5 0SJ
The registered office of Utsi Electronics Ltd is Unit 26, Glenmore Business
Park, Ely Road, Waterbeach, Cambridge, Cambridgeshire, CB25 9PG.
13 Inventories
Group Company
2025 2024 2025 2024
£'000 £'000 £'000 £'000
Raw materials - - - -
Finished goods 105 113 - -
105 113 - -
The replacement cost of the above inventories would not be significantly
different from the values stated.
The cost of inventories recognised as an expense during the year amounted to
£769,000 (2024: £2,709,000). For the Parent company this was £nil (2024:
£nil).
14 Trade and other receivables
Group Company
2025 2024 2025 2024
£'000 £'000 £'000 £'000
Current
Trade receivables 397 504 - -
Amounts owed by Group undertakings less provision - - 87 9
Other Debtors 116 125 93 -
Accrued income 45 235 - -
Prepayments 170 143 - -
728 1,007 180 9
15 Trade and other payables
Group Company
2025 2024 2025 2024
£'000 £'000 £'000 £'000
Current
Trade payables 418 406 74 55
Other taxation and social security 231 370 - 13
Payments received on account 6 389 - -
Accruals and other creditors 311 209 31 61
966 1,374 105 129
Group Company
2025 2024 2025 2024
£'000 £'000 £'000 £'000
Non-current
Amounts owed to Group undertakings - - 277 310
Other creditors - 121 - -
- 121 277 310
The performance obligations of the IFRS 15 contract liabilities (payments
received on account) are expected to be met within the next financial year.
The brought forward payments received on account figure was £389,000, this
was all recognised during the financial year 2025.
16 Borrowing analysis
Group Company
2025 2024 2025 2024
£'000 £'000 £'000 £'000
Due within one year
Bank and other loans 991 783 633 578
Directors' loan 2,294 2,035 2,294 2,035
Obligations under lease agreements 116 111 - -
3,401 2,929 2,927 2,613
Due after more than one year
Bank and other loans 246 342 169 240
Directors' loan 3,336 3,342 3,336 3,342
Obligations under lease agreements 81 96 - -
3,663 3,780 3,505 3,582
Repayable
Due within 1 year 3,401 2,929 2,927 2,613
Over 1 year but less than 2 years 3,505 3,652 3,445 3,522
Over 2 years but less than 5 years 158 128 60 60
7,064 6,709 6,432 6,195
Directors' loans
Included with Directors' loans and borrowings due within one year are accrued
fees and interest owing to G.G Watt of £2,294,000 (2024: £2,035,000). The
accrued fees and interest are repayable on demand and no interest accrues on
the balance.
The director's loan due in more than one year is a loan of £3,336,000 from
G.G Watt. Directors' loans comprise of two elements. A loan attracting
interest at 2.15% over Bank of England base rate. At the year-end
£2,336,000 (2024: £2,342,000) was outstanding in relation to this loan.
During the year to 30 June 2025 £241,000 (2024: £543,000) was repaid. The
Company has the right to defer payment for a period of 366 days.
On 13 August 2010 the Company issued £1 million of Convertible Unsecured Loan
Stock ("CULS") to G.G Watt, the Chairman of the Company. The CULS were
issued to replace loans made by G.G Watt to the Company amounting to £1
million and has been recognised in non-current liabilities of £3,336,000.
Pursuant to amendments made on 13 November 2014, 9 November 2018 and 30 June
2022 the principal terms of the CULS are as follows:
- The CULS may be converted at the option of Gordon Watt at a price of
p per share at any time prior to 13 August 2026;
- Interest is payable at a rate of 10 per cent per annum on the
principal amount outstanding until converted, prepaid or repaid, calculated
and compounded on each anniversary of the issue of the CULS. On conversion
of any CULS, any unpaid interest shall be paid within 20 days of such
conversion;
- The CULS are repayable, together with accrued interest on 13 August
2026 ("the Repayment Date").
No equity element of the convertible loan stock was recognised on issue of the
instrument as it was not considered to be material.
Bank and other loans
Included in bank and other loans is an invoice discounting facility of
£218,774 (2024: £170,766). The principal terms of which are interest at
2.58% over Bank of England base rate and secured on the company's debtors.
Included in bank and other loans is a secured mortgage of £78,417 which
incurs an interest rate of 2.44% over base rate for 10 years and at a rate of
2.64% over base thereafter.
As a result of COVID 19, Coronavirus Business Interruption Loan Scheme (CBILS)
became available for the business. This enabled the group to secure two loans.
The loan for £400,000 had a remaining balance outstanding of £87,000, at a
rate of 3.96%, over base and the second loan of £150,000 had a remaining
balance outstanding of £40,000, at a rate of 2.96% over base. The amount of
interest paid during the Financial Year was £11,145.
The business was also able to secure a Bounce Back loan through Wessex
Precision Engineering of £24,000 the remaining balance outstanding is
£10,000, and Utsi obtained £50,000 bounce back loan the remaining balance
outstanding is £24,000 both with an interest rate of 2.5%.
2025 Non-cash:
Bought forward Non-cash: Non-cash: Accrued fees /interests Carried forward
Cash flows Lease release / disposal New leases
£'000 £'000 £'000 £'000 £'000 £'000
Director loan 5,376 (77) - - 331 5,630
Leases 207 (130) - 115 5 197
Other 1,126 28 - - 83 1,237
Loans and borrowings 6,709 (179) - 115 419 7,064
2024 Non-cash:
Bought forward Non-cash: Non-cash: Accrued fees/interests Carried forward
Cash flows Lease release / disposal New leases
£'000 £'000 £'000 £'000 £'000 £'000
Director loan 4,284 769 - - 323 5,376
Leases 2,487 (572) (1,873) 75 90 207
Other 1,028 30 - - 68 1,126
Loans and borrowings 7,799 227 (1,873) 75 481 6,709
17 Financial instruments
The Group uses financial instruments, which comprise cash and various items,
such as trade receivables and trade payables that arise from its operations.
The main purpose of these financial instruments is to finance the Group's
operations.
The main risks arising from the Group's financial instruments are credit risk,
liquidity risk and interest rate risk. A number of procedures are in place
to enable these risks to be controlled. For liquidity risk these include
profit/cash forecasts by business segment, quarterly management accounts and
comparison against forecast. The board reviews and agrees policies for
managing this risk on a regular basis.
Credit risk
The credit risk exposure is the carrying amount of the financial assets as
shown in note 14 (with the exception of prepayments which are not financial
assets) and the exposure to the cash balances. Of the amounts owed to the
Group at 30 June 2025, the top 3 customers comprised 70% (2024: 41%) of total
trade receivables.
The Group has adopted a policy of only dealing with creditworthy
counterparties and the Group uses its own trading records to rate its major
customers, also the Group invoices in advance where possible. The Group's
exposure and the credit ratings of its counterparties are continuously
monitored and the aggregate value of transactions concluded is spread amongst
approved counterparties. Having regard to the credit worthiness of the
Groups significant customers the directors believe that the Group does not
have any significant credit risk exposure to any single counterparty.
Within revenue there are two customers which individually represent 22.4% and
10.0% of the overall revenue for the financial year, this compared to 11.8%
and 9.1% in the previous financial year.
An analysis of trade and other receivables:
2025 Weighted average loss rate Gross carrying Impairment loss allowance
value
£'000 £'000 £'000
Performing 0.00% 728 -
2024 Weighted average loss rate Gross carrying value Impairment loss allowance
£'000 £'000
Performing 0.00% 1,007 -
Interest rate risk
The Group finances its operations through a mixture of shareholders' funds and
borrowings. The Group borrows exclusively in Sterling and principally at
fixed and floating rates of interest and are disclosed at note 16.
As disclosed in note 16 the Group is exposed to changes in interest rates on
its borrowings with a variable element of interest. If interest rates were to
increase by one percentage point the interest charge would be £23,000
higher. An equivalent decrease would be incurred if interest rates were
reduced by one percentage point.
Liquidity risk
As stated in note 1 the Executive Chairman, G.G Watt, has pledged to provide
ongoing financial support for a period of at least twelve months from the
approval date of the Group statement of financial position. It is on this
basis that the directors consider that neither the Group nor the Company is
exposed to a significant liquidity risk.
Contractual maturity analysis for financial liabilities:
2025 Less than Due between Due between
1 year 1-2 years 2 - 5+ years Total
£'000 £'000 £'000 £'000
Trade and other payables 966 - - 966
Borrowings 3,285 3,540 42 6,867
Lease liability 116 25 56 197
4,367 3,565 98 8,030
2024 Less than Due between Due between
1 year 1-2 years 2 - 5+ years
Total
£'000 £'000 £'000 £'000
Trade and other payables 1,374 121 - 1,495
Borrowings 2,818 3,614 70 6,502
Lease liability 111 96 - 207
4,303 3,831 70 8,204
Financial liabilities of the Company are all due within less than three months
with the exception of the intercompany balances that are due between 1 and 5
years.
Fair value of financial instruments
Loans and receivables are measured at amortised cost. Financial liabilities
are measured at amortised cost using the effective interest method. The
directors consider that the fair value of financial instruments are not
materially different to their carrying values.
Capital risk management
The Group's objectives when managing capital are to safeguard the Group's
ability to continue as a going concern in order to be able to move to a
position of providing returns for shareholders and benefits for other
stakeholders and to maintain an optimal capital structure to reduce the cost
of capital.
The Group manages trade debtors, trade creditors and borrowings and cash as
capital. The entity is meeting its objective for managing capital through
continued support from G G Watt as described per note 1.
18 Share capital
2025 2025 2024 2024
No. £'000 No. £'000
Authorised
Ordinary shares of 1p each 40,000,000 400 40,000,000 400
Allotted and fully paid
Brought forward 36,312,823 363 36,312,823 363
Issued during the year - - - -
Carried forward 36,312,823 363 36,312,823 363
Fully paid ordinary shares carry one vote per share and carry a right to
dividends.
12,893,703 (2024: 12,893,703) share options were outstanding at the year end,
comprising the 2,240,000 employee options and the 10,653,703 share options and
warrants held by directors disclosed below.
Share based payments have been included in the financial statements where they
are material. No share-based payment expense has been recognised (2024 :
nil).
No deferred tax asset has been recognised in relation to share options due to
the uncertainty of future available profits.
The director and employee share options were issued as part of the Group's
strategy on key employee remuneration, they lapse if the employee ceases to be
an employee of the Group during the vesting period.
Employee options
Date options exercisable Number of shares Exercise price
Between November 2019 and November 2026 200,000 3.875p
Between November 2020 and November 2027 100,000 3.75p
Between March 2024 and March 2031 1,090,000 8.00p
Between January 2026 and January 2033 700,000 14.25p
Between December 2027 and December 2034 1,100,000 2.35p
Directors' share options
Number of options
Granted during the year Lapsed during the year Date from
Directors' share options At start At end of year Exercise price which
of year exercisable
GGWatt 750,000 - - 750,000 8.0p 18 Mar 2024
TWilliams 200,000 - - 200,000 14.25p 10 Jan 2026
The Company's share price at 30 June 2025 was 1.68p. The high and low during
the period under review were 8.50p and 1.01p respectively.
In addition to the above, in consideration of loans made to the Company, G.G
Watt has warrants over 3,703,703 ordinary shares at an exercise price of 13.5p
and a further 6,000,000 ordinary shares at an exercise price of 3.0p.
The weighted average contractual life of share options outstanding at the
year-end is 7.03 years (2024: 6.86 years).
The Company's share price at 30 June 2025 was 1.68p. The high and low during
the period under review were 8.50p and 1.01p respectively.
In addition to the above, in consideration of loans made to the Company, G.G
Watt has warrants over 3,703,703 ordinary shares at an exercise price of 13.5p
and a further 6,000,000 ordinary shares at an exercise price of 3.0p.
The weighted average contractual life of share options outstanding at the
year-end is 7.03 years (2024: 6.86 years).
19 Related party transactions
Directors' loan disclosures are given in note 16. The interest payable to
directors in respect of their loans during the year was:
G.G Watt - £259,266
The directors are considered the key management personnel of the Company.
Remuneration to directors is disclosed in note 6.
Included within the amounts due from and to Group undertakings were the
following balances:
2025 2024
£ £
Balance due from:
Thomson Engineering Design Limited 78,584 391,898
Wessex Precision Engineering Limited 8,520 8,520
Balance due to:
Adien Limited 21,473 16,614
Utsi Electronics Limited 255,306 256,897
There is no ultimate controlling party of PipeHawk plc.
Other related party transactions
2025 2024
£ £
Balance due to:
Express Travel Ltd 80,223 -
20 Government grants
No government grants were recognised during the period:
Group Company
2025 2024 2025 2024
£'000 £'000 £'000 £'000
- 18 - -
Grant
- 18 - -
21 Post Balance Sheet Events
There were no adjusting or significant non-adjusting events between 30 June
2025 and the approval of the financial statements.
22 Copies of Reports and Accounts
Copies of the Report and Accounts will be posted to shareholders later today
and will be available from the Company's registered office, 2a & 3
Crabtree Road, Forest Vale Industrial Estate, Cinderford, England, GL14 2YQ
and from the Company's website www.pipehawk.com (http://www.pipehawk.com/) .
23 Notice of Annual General Meeting
The Report and Accounts will include a notice that the annual general meeting
will be held at the offices of Allenby Capital Limited at 5th floor, 5 St
Helen's Place, London, EC3A 6AB at 11:30 am on 18 December 2025.
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Copyright 2019 Regulatory News Service, all rights reservedRecent news on Pipehawk
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