GOODWIN PLC

Annual Report • Aug 15, 2025

213800N4T1NMSJ57B322-2025-04-30-T01 213800N4T1NMSJ57B3222024-05-012025-04-30213800N4T1NMSJ57B3222023-05-012024-04-30ifrs-full:IssuedCapitalMember213800N4T1NMSJ57B3222024-04-30213800N4T1NMSJ57B3222023-05-012024-04-30213800N4T1NMSJ57B3222023-05-012024-04-30ifrs-full:EquityAttributableToOwnersOfParentMember213800N4T1NMSJ57B3222023-05-012024-04-30ifrs-full:ReserveOfSharebasedPaymentsMember213800N4T1NMSJ57B3222023-05-012024-04-30ifrs-full:NoncontrollingInterestsMember213800N4T1NMSJ57B3222025-04-30213800N4T1NMSJ57B3222024-04-30ifrs-full:IssuedCapitalMember213800N4T1NMSJ57B3222024-05-012025-04-30ifrs-full:IssuedCapitalMember213800N4T1NMSJ57B3222024-05-012025-04-30ifrs-full:RetainedEarningsMember213800N4T1NMSJ57B3222023-05-012024-04-30ifrs-full:ReserveOfChangeInValueOfForwardElementsOfForwardContractsMember213800N4T1NMSJ57B3222024-05-012025-04-30ifrs-full:ReserveOfCashFlowHedgesMember213800N4T1NMSJ57B3222024-05-012025-04-30ifrs-full:EquityAttributableToOwnersOfParentMember213800N4T1NMSJ57B3222025-04-30ifrs-full:IssuedCapitalMember213800N4T1NMSJ57B3222023-04-30ifrs-full:ReserveOfCashFlowHedgesMember213800N4T1NMSJ57B3222024-05-012025-04-30ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember213800N4T1NMSJ57B3222024-04-30ifrs-full:ReserveOfSharebasedPaymentsMember213800N4T1NMSJ57B3222024-04-30ifrs-full:ReserveOfChangeInValueOfForwardElementsOfForwardContractsMember213800N4T1NMSJ57B3222023-05-012024-04-30ifrs-full:RetainedEarningsMember213800N4T1NMSJ57B3222023-05-012024-04-30ifrs-full:ReserveOfCashFlowHedgesMember213800N4T1NMSJ57B3222024-05-012025-04-30ifrs-full:ReserveOfChangeInValueOfForwardElementsOfForwardContractsMember213800N4T1NMSJ57B3222024-05-012025-04-30ifrs-full:NoncontrollingInterestsMember213800N4T1NMSJ57B3222023-05-012024-04-30ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember213800N4T1NMSJ57B3222024-04-30ifrs-full:EquityAttributableToOwnersOfParentMember213800N4T1NMSJ57B3222025-04-30ifrs-full:EquityAttributableToOwnersOfParentMember213800N4T1NMSJ57B3222024-04-30ifrs-full:RetainedEarningsMember213800N4T1NMSJ57B3222023-04-30ifrs-full:ReserveOfChangeInValueOfForwardElementsOfForwardContractsMember213800N4T1NMSJ57B3222025-04-30ifrs-full:ReserveOfChangeInValueOfForwardElementsOfForwardContractsMember213800N4T1NMSJ57B3222025-04-30ifrs-full:RetainedEarningsMember213800N4T1NMSJ57B3222024-04-30ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember213800N4T1NMSJ57B3222024-04-30ifrs-full:NoncontrollingInterestsMember213800N4T1NMSJ57B3222023-04-30213800N4T1NMSJ57B3222023-04-30ifrs-full:NoncontrollingInterestsMember213800N4T1NMSJ57B3222024-04-30ifrs-full:ReserveOfCashFlowHedgesMember213800N4T1NMSJ57B3222023-04-30ifrs-full:IssuedCapitalMember213800N4T1NMSJ57B3222023-04-30ifrs-full:RetainedEarningsMember213800N4T1NMSJ57B3222025-04-30ifrs-full:NoncontrollingInterestsMember213800N4T1NMSJ57B3222023-04-30ifrs-full:ReserveOfSharebasedPaymentsMember213800N4T1NMSJ57B3222023-04-30ifrs-full:EquityAttributableToOwnersOfParentMember213800N4T1NMSJ57B3222025-04-30ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember213800N4T1NMSJ57B3222025-04-30ifrs-full:ReserveOfCashFlowHedgesMember213800N4T1NMSJ57B3222023-04-30ifrs-full:ReserveOfExchangeDifferencesOnTranslationMemberiso4217:GBPiso4217:GBPxbrli:shares D I R E C T O R S R E P O R T A N D A C C O U N T S 3O th A P R IL 2O25 INDEX 1 Notice of Annual General Meeting 2 Notes to Notice of Annual General Meeting GROUP STRATEGIC REPORT 3 Chairman’s Statement 8 Summary of Consolidated Statement of Profit or Loss 9 Objectives, Strategy and Business Model 14 Principal Risks and Uncertainties 16 Corporate Social Responsibility DIRECTORS’ REPORTS 24 Report of the Directors 27 Corporate Governance Report 31 Audit Committee Report 34 Directors’ Remuneration Policy and Report 40 Statement of Directors’ responsibilities in respect of the Annual Report and the Financial Statements AUDITOR’S REPORT 41 Independent Auditor’s Report to the Members of Goodwin PLC FINANCIAL STATEMENTS 50 Consolidated Statement of Profit or Loss 51 Consolidated Statement of Comprehensive Income 52 Consolidated Balance Sheet 53 Consolidated Statement of Changes in Equity 55 Consolidated Statement of Cash Flows 56 Notes to the Financial Statements 93 Company Balance Sheet 94 Company Statement of Comprehensive Income 95 Company Statement of Changes in Equity 96 Notes to the Company Financial Statements 106 Alternative Performance Measures 107 FIVE YEAR FINANCIAL SUMMARY FINANCIAL HIGHLIGHTS Accounting policies 56 Earnings per share 70 Provisions 81 Alternative performance 106 Estimates and judgements 63 Related parties 91 measures Finance costs (net) 69 Revenue 66 Borrowings 78 Financial risk management 84 Right-of-use assets 72 Capital and reserves 82 Guarantees and contingencies 91 Subsequent events 91 Capital commitments 91 Intangible assets 75 Segmental information 64 Cash and cash equivalents 78 Interest rate swap 89 Staff numbers and costs 68 Company statements 93 Investments in subsidiaries 73 Taxation 69 Deferred tax 81 Inventories 77 Net debt 84 Trade and other receivables 78 Dividend and capital Property, plant and equipment 71 expenditure policy 13 Trade and other payables 80 GOODWIN PLC www.goodwin.co.uk Registered in England and Wales, Number 305907 Established 1883 T. J. W. Goodwin M. S. Goodwin Directors: S. R. Goodwin B. R. E. Goodwin (Chairman) (Managing Director) (Managing Director) (Director) Mechanical Refractory Engineering Division Engineering Division J. E. Kelly N. Brown C. A. McNamara (Non-Executive Director) (Director) (Non-Executive Director) Secretary and registered office: Registrar and share transfer office: Mrs. J. L. Martin, L.L.B., A.C.I.S. Computershare Investor Services PLC, Ivy House Foundry, Hanley, The Pavilions, Bridgwater Road, Stoke-on-Trent, ST1 3NR Bristol, BS99 6ZZ Auditor: RSM UK Audit LLP, Festival Way, Festival Park, Stoke-on-Trent, ST1 5BB NOTICE IS HEREBY GIVEN that the NINETIETH ANNUAL GENERAL MEETING of the Company will be held at 10.30am on Wednesday, 1st October, 2025 at Crewe Hall, Weston Road, Crewe, Cheshire CW1 6UZ for the purpose of considering and, if thought fit, passing the following resolutions which are proposed as ordinary resolutions. 1. To receive the Directors’ Reports and the audited financial statements for the year ended 30th April, 2025. 2. To approve the payment of the proposed ordinary dividend on the ordinary shares. 3. To re-elect Mr. B. R. E. Goodwin as a Director. 4. To-re-elect Ms. C. A. McNamara as a Non-Executive Director. 5. To approve the Directors’ Remuneration Report (excluding the Directors’ Remuneration Policy) for the year ended 30th April, 2025, as stated on pages 36 to 39 of the Directors’ Report. 6. To approve the Directors’ Remuneration Policy, the full text of which is set out on page 34 to 35 of the Directors’ Report. 7. To re-appoint RSM UK Audit LLP as auditor and to authorise the Directors to determine their remuneration. By Order of the Board J. L. Martin Secretary Registered Office: Ivy House Foundry, Hanley, Stoke-on-Trent 29th July, 2025 1 NOTES TO NOTICE OF ANNUAL GENERAL MEETING: 1. Members are entitled to appoint a proxy to exercise all or any of their rights to attend and to speak and vote on their behalf at the meeting. A shareholder may appoint more than one proxy in relation to the Annual General Meeting provided that each proxy is appointed to exercise the rights attached to a different share or shares held by that shareholder. A proxy need not be a shareholder of the Company. A proxy form which may be used to make such appointment and give proxy instructions accompanies this notice. 2. To be valid any proxy form or other instrument appointing a proxy must be received by post, by scanned copy sent to proxies@goodwingroup.com or (during normal business hours only) by hand at Ivy House Foundry, Hanley, Stoke-on- Trent, ST1 3NR no later than 10.30am on 29th September, 2025. 3. The return of a completed proxy form or other such instrument will not prevent a shareholder attending the Annual General Meeting and voting in person if he/she wishes to do so. 4. Any person, to whom this notice is sent, who is a person nominated under section 146 of the Companies Act 2006 to enjoy information rights (a “Nominated Person”) may, under an agreement between him/her and the shareholder by whom he/she was nominated, have a right to be appointed (or to have someone else appointed) as a proxy for the Annual General Meeting. If a Nominated Person has no such proxy appointment right or does not wish to exercise it, he/she may, under any such agreement, have a right to give instructions to the shareholder as to the exercise of voting rights. 5. The statement of the rights of shareholders in relation to the appointment of proxies in paragraphs 1 and 2 above does not apply to Nominated Persons. The rights described in these paragraphs can only be exercised by shareholders of the Company. 6. To be entitled to attend and vote at the Annual General Meeting (and for the purpose of the determination by the Company of the votes they may cast), shareholders must be registered in the Register of Members of the Company at 10.30am on 29th September, 2025 (or, in the event of any adjournment, 10.30am on the date which is two days before the time of the adjourned meeting). Changes to the Register of Members after the relevant deadline shall be disregarded in determining the rights of any person to attend and vote at the meeting. 7. As at 28th July, 2025 (being the last business day prior to the publication of this Notice) the Company’s issued share capital consists of 7,509,600 ordinary shares, carrying one vote each. Therefore, the total voting rights in the Company as at 28th July, 2025 are 7,509,600. 8. Shareholders should note that it is possible that, pursuant to requests made by shareholders of the Company under section 527 of the Companies Act 2006, the Company may be required to publish on a website a statement setting out any matter relating to: (i) the audit of the Company’s accounts (including the auditor’s report and the conduct of the audit) that are to be laid before the Annual General Meeting; or (ii) any circumstance connected with an auditor of the Company ceasing to hold office since the previous meeting at which annual accounts and reports were laid in accordance with section 437 of the Companies Act 2006. The Company may not require the shareholders requesting any such website publication to pay its expenses in complying with sections 527 or 528 of the Companies Act 2006. Where the Company is required to place a statement on a website under section 527 of the Companies Act 2006, it must forward the statement to the Company’s auditor not later than the time when it makes the statement available on the website. The business which may be dealt with at the Annual General Meeting includes any statement that the Company has been required under section 527 of the Companies Act 2006 to publish on a website. 9. In order to facilitate voting by corporate representatives at the meeting, arrangements will be put in place at the meeting so that (i) if a corporate shareholder has appointed the chairman of the meeting as its corporate representative with instructions to vote on a poll in accordance with the directions of all of the other corporate representatives for that shareholder at the meeting, then on a poll those corporate representatives will give voting directions to the chairman and the chairman will vote (or withhold a vote) as corporate representative in accordance with those directions; and (ii) if more than one corporate representative for the same corporate shareholder attends the meeting but the corporate shareholder has not appointed the chairman of the meeting as its corporate representative, a designated corporate representative will be nominated, from those corporate representatives who attend, who will vote on a poll and the other corporate representatives will give voting directions to that designated corporate representative. Corporate shareholders are referred to the guidance issued by The Chartered Governance Institute on proxies and corporate representatives (www.cgi.org.uk) for further details of this procedure. The guidance includes a sample form of representation letter if the chairman is being appointed as described in (i) above. 10. None of the Directors has a service contract with the Company. 11. If approved by shareholders at the Annual General Meeting on 1st October, 2025, the ordinary dividends of 280 pence per share will be payable in equal instalments of 140 pence per share on 3rd October, 2025 and on or around 10th April, 2026 to shareholders on the register on 12th September, 2025 and on or around 20th March, 2026 respectively. 2 GROUP STRATEGIC REPORT GOODWIN PLC CHAIRMAN’S STATEMENT I am pleased to report a record level of profits for the Group for the twelve month period ended 30th April, 2025. The “Trading” pre-tax profit was £35.5 million (2024: £24.1 million) an increase of 47% from the previous financial year’s trading profits on revenue of £220 million, which is up 15% on the revenue reported for last financial year. The Directors propose an increased dividend of 280 pence (2024:133 pence) per share, an 111% increase, for the reasons outlined further below and in the Dividend and Capital Expenditure Policy on page 13 of these accounts. The Group’s increased performance was in line with expectations, with the growing momentum within the Mechanical Division being the primary driver of the improved result. The increase in the Group’s gross margin to 42% is a reflection of the quality of the nuclear and defence related contracts starting to come through. The excellent Group result was not only in terms of profitability but also in the total amount of cash generated from operations during the year that amounted to £67 million (2024: £33 million) and has resulted in the Group’s net debt being reduced from £42.9 million to £13.6 million as at 30th April, 2025, and consequently the Group’s gearing has reduced from 35.1% to 9.9%. Mechanical Engineering Division The growth in profitability from both Goodwin Steel Castings and Goodwin International within the Mechanical Division continues to come from the supply of precision-machined, high-integrity castings into mission critical defence and nuclear applications. It is these markets, specifically the defence markets, where the market backdrop of increased defence spending has placed the Division in a favourable position to capitalise from the pipeline of growing opportunities within this sector. Over the past seven years, the respective teams have worked hard to be the preferred incumbent supplier on many UK and US Navy frigate and submarine programmes, due to being able to supply high-quality products, that are technically difficult to make on a fast and consistent basis. The breadth of our involvement into these programmes continues to grow, with components now manufactured for the Astute, Virginia, Columbia and Dreadnaught submarine programmes, as well as for the Type 26 and DDG frigate programmes and the Gerald R Ford-class aircraft carrier. Furthermore, we are under contract and actively working on pre-manufacturing activities in relation to the AUKUS partnership, to build and supply components for the next generation of nuclear- powered submarines. With the majority of these programmes being multi-decade projects, it provides the Group with great visibility and confidence in the long-term growth that lies ahead, even though the vast majority of the value in these programmes to Goodwin has yet to be included in the Group’s overall workload figure, which, at the time of writing, stands at £287 million. The Division has benefitted from the mix of work flowing through both the facilities. Typically, the defence products are made from an impact-resistant, low-carbon, high-alloy martensitic steel, which enables the foundry, with all of its recent investments and upgrades, to utilise different furnaces to also supply the 29 tonne ductile iron self-shielded boxes (SSB), that are being manufactured for the containment of nuclear waste at Sellafield. This product line is another example of a multi-decade programme, that will continue to contribute to our growth over the long- term. To date, 237 SSBs have been contractually awarded and 90 of these have been manufactured and shipped. However, it is reported that up to 747 of these SSBs could be required and, with no one else in the UK able to supply the product, it provides the Board with further confidence, and is another product that will continue to contribute to our growth over the long-term. Easat Radar Systems, as expected, has won several contracts during the year, to supply its state of the art surveillance systems, that has helped the Easat Group transition from loss- 3 GROUP STRATEGIC REPORT CHAIRMAN’S STATEMENT (continued) making to generating profits of approximately £1 million. Whilst the timing of the contract awards has been slow, which has resulted in the in-year activity being significantly lower than anticipated and possible, it nevertheless provides the Board with greater assurance that the management team at Easat Radar Systems can now capitalise on recent successes and increase the profitability of the Company. This is particularly relevant given the number of customers now approaching Easat, having heard within air traffic control circles that a UK supplier is offering a high-performance system at a cost-effective price - something they have not been used to for many years. The in-year activity at Easat relates to building systems for the Royal Thai Airforce, a new civil airport in Vietnam and Cranfield airport in the UK, which, later on in the year, will act as a reference for many other UK potential customers, who have confirmed their requirements for new surveillance systems. The two other components of the Mechanical Division of note are our valve company in Germany, Noreva GmbH, and the new advanced polyimide subsidiary, Duvelco. Noreva, as reported in the March trading update, has received its largest ever order, a $15 million contract to supply valves for an LNG project. Furthermore, since the trading update, the Company has gone on to win additional LNG contracts, that are to be delivered over the next few years. For Duvelco, whilst in its infancy, with customer trials already underway, the Board believes this strategic development for the Group will be the largest and most profitable division in years to come. We have increased the commercial team in size by headhunting key individuals with longstanding specific industry knowledge in different sectors, who also have an understanding of super engineering plastics, that can sell the benefits of our enhanced material produced by our worldwide patented process (patent award granted May 2025). The Duvelco team exhibited our material at the Paris Air Show last month, where significant interest was shown in the product by aerospace customers. To further enhance Duvelco’s overall offering and earning potential, investments have been made in Noreva in the form of a new 1,200 square metre building and high technology CNC powder-pressing machinery. The building has been constructed on its existing site, and the purchase of three electrically-driven CNC powder presses will mean that the Group can sell both the raw resin powder, stock shapes and finished pressed parts. The building has been completed and it is envisaged that the presses will be fully commissioned and operational by the end of the year, which is when we expect to start to make the first commercial sales of our material in all its forms. The German pressing facility can be expanded up to 30 presses in the constructed facility; with additional future expansion planned on the adjacent site the Group bought in 2021 to facilitate additional growth as the operation expands. I am pleased to report with respect to USA tariffs that the impact on our operations has been minimal. Goodwin Steel Castings supplies machined castings into the US Navy shipbuilding programmes, which are exempt from such tariffs, the remainder of the Group has experienced negligible effects due to the nature of our contractual shipping terms. For contracts such as the supply of valves for US LNG projects, many are shipped to tariff-free trade zones, which avoid the application of tariffs, or else the Group has ensured that the products sold to the US are supplied on an ex-works or similar basis, so that the cost of any applicable tariffs are borne by the buyer. It is also worth noting that, for high-value and high-integrity products, a 10% surcharge on the cost of goods for the buyer is relatively insignificant, when you compare it to not obtaining the goods they require in terms of quality or lead times, especially within the gas industry that is currently so buoyant. As a result of prudent risk mitigation by the commercial teams, and the specialised nature of the Division’s product offering, the direct incremental tariff cost to the Division, arising from US policy changes during the year ended 30th April, 2025, is limited to less than £100,000 over several small orders, of which most customers have split the tariff and have agreed to pay 50% of the tariff cost on our behalf. This figure includes the current workload, that will largely be shipped over the next three years. 4 GROUP STRATEGIC REPORT CHAIRMAN’S STATEMENT (continued) Refractory Engineering Division The Refractory Division has once again performed strongly, reflecting its resilience and market leadership. The geographic spread of its operations, specifically those in China, India and Thailand have helped the Division to increase its operating profits by 9% during the year. Highlights in relation to the investment casting powder markets include, pre-tax profits in China increasing by 33%, as the team capitalised on domestic middle-income growth, whilst also growing their market share within the low-end brass sector. In Thailand, the restructuring and overhead reductions initiated last year aided the Company to deliver a 25% improvement in profitability. In India, our new 76,000 square foot investment powder manufacturing facility is now fully operational. With India continuing to represent a key growth market for investment casting powders, this facility - constructed over the past two years - will provide much needed capacity to meet current demand and support substantial market expansion over the next five to ten years, as India expands its GDP at a similar rate to China from 2005 to 2015. Much of the growth in product sales to the Indian jewellery casting sector is driven by rising domestic consumption, fuelled by the country’s rapid economic development and increasing levels of disposable income. In response, management has strategically prioritised market share expansion, resulting in stable profits for the year. However, by maintaining tight control over cost structures, we remain well-positioned to stay competitive and agile in this evolving market, ensuring we retain global market leadership while continuing to grow profitability. Sales of vermiculite-based fire extinguishers and extinguishing agents, known as Lith-ex and AVD, continue to grow. Given the broad range of applicable industries, we remain highly optimistic about the long-term potential of this product line. While the build-up in sales volume is taking time, there are numerous ongoing customer discussions and certification processes in various countries that are expected to support sustained growth in the years ahead. Encouragingly, feedback consistently confirms that, despite the emergence of alternative products, none matches the performance of AVD in extinguishing flames and limiting fire propagation. In parallel, we have commenced production of specialist lithium ion battery fire blankets at our Indian facility. These blankets, made from vermiculite dispersion-coated e-glass fabrics, offer significantly superior thermal resistance compared to competing products. In the UK, renovation of the newly acquired 50,000 square foot facility is now complete and contains our expanded in-house production plant for vermiculite dispersion , the core material used in AVD, as well as the Lith-ex fire extinguisher manufacturing and filling plant. Certification from BSI for the production line was granted in January 2025, and we are now filling extinguishers produced in-house at a lower cost. Other successes within the Refractory Engineering Division include the sale of high-quality fire- stopping mortars, that are sold by the Sandersfire division of Hoben International under the brand name of Firecrete. Following the disaster of Grenfell, there has been a much greater focus on preventing the spread of fires within buildings, and, with Sandersfire fire-rated mortars being specifically designed for large span floor openings and the sealing of cabling/ pipework , the sales of the product have increased by 38%. With regards to tariffs, the Refractory Engineering Division has not been materially impacted by the US tariffs during the year. Nonetheless though, we continue to be vigilant of the evolving landscape and the long-term impacts of the enacted changes. However, our sales to China of AVD have benefitted as some Chinese users of AVD, who were buying from our USA competitor, are now buying from us, due to the tariff increases between the USA and China. 5 GROUP STRATEGIC REPORT CHAIRMAN’S STATEMENT (continued) Cashflow With capital expenditure in the year being only £13 million, the Group’s excellent ability to generate cash has been highlighted by the gearing falling from 35.1% to only 9.9% during the year, which equates to a net debt of only £13.6 million. We continue to maintain tight control on discretionary spend, as we intend to reduce and maintain the Group debt at such a level so that it is kept below the £30 million interest rate SWAP that is currently in place, which has an interest rate of less than 1% and is in place until August 2031. As a direct impact of this instrument, the Group has enjoyed an interest saving of £1.2 million compared to last year, and, should the debt level remain constant at this level throughout the current year, there will be additional savings in interest payable. One of the areas that has materially helped the reduction in debt has been the excellent work by the commercial teams in negotiating upfront payment within their contracts. Furthermore, due to many of the contracts containing multiple cash payment milestones at various production sign off points, we do not envisage an overall cashflow unwind on these contracts. With one of the Group’s bank facilities due to mature in July 2025, I can confirm, following a competitive tender to obtain the best deal, that the Board has renewed this facility agreement. The facility renewal occurred post year end, in June 2025, and was for the same quantum which will provide the Group with ample headroom, should an opportunity arise that the Group wishes to capitalise on, particularly where free cash flow alone may not be sufficient. The four-year committed facility was renewed on much improved terms, which is a reflection of the Group’s profitability, newly acquired FTSE 250 status and our overall stronger financial standing. Dividend With having spent over £50 million at the foundry, Goodwin Steel Castings, over the last ten years and over £23 million invested in the advanced polyimide business, Duvelco, the Group has over many years, prioritised significant capital investment to equip the Group with the capacity, capability and geographical reach to drive long-term growth, both in the UK and overseas. The Board now considers it appropriate, without it jeopardising its ability to capitalise on opportunities as they arise, to amend the dividend policy to further reward shareholders for their continued support. Taking into consideration the longer term visibility, supported by the workload and the Group’s lower gearing, the Board is confident that the alteration of the dividend policy from 38% to 58% of post-tax profits plus depreciation and amortisation is a safe and viable change for now and the foreseeable future. Group Growth Strategy and Ethos We are frequently asked by individual shareholders how the Group has been able to achieve, and continues to achieve, a compound annual growth rate of 19% in total shareholders return (TSR) over the past 20 years — a performance that has far outpaced the FTSE 100, FTSE 350 and even the Standard & Poor 500 (S & P 500), that the latter has only had an annualised growth rate of 11% over the same period. Goodwin PLC’s Total Shareholder Return (TSR) has increased 3,104%, compared to just 274% for the FTSE 100 and 696% for the S & P 500 over the last twenty years. As a PLC, we are unable to respond to such questions individually, unless the information is shared with all shareholders simultaneously. Accordingly, we provide below a brief outline of the approach and principles that underpin this long-term success. At the heart of the Group’s strategy is a clear and consistent policy: to target “niche” global markets with annual revenue potential typically measured in the hundreds of millions of 6 GROUP STRATEGIC REPORT CHAIRMAN’S STATEMENT (continued) pounds, not billions. These are specialist markets that tend not to attract the attention or investment of large, multinational corporations, due to their limited scale and high barriers to entry. This selective targeting allows us to build competitive advantages without facing disruptive levels of competition from global conglomerates. Accompanied by this policy, we have deliberately engineered product and market diversity across all our trading subsidiaries. Each business within a reasonable period must strive to be the number one or number two global supplier — both in terms of technical performance and turnover. This is enabled by the majority of the technology we offer either being patent protected or uniquely difficult to manufacture, further reinforcing our leadership in each market we serve and these two facets provide opportunity for high gross margin to be earned. For over two decades, the Group has held annual business conferences, originally attended by fifteen Directors from a handful of companies, these now bring together over eighty-five Directors and senior leaders from across our global businesses. It is at these conferences that the drive for growth in gross margin is reinforced, as each company presents in front of its peers its past performance, capital investment plans, and how they intend to sustainably grow their gross margin. Our core focus remains on gross margin — not only in percentage terms, but more importantly in absolute margin contribution per product. Turnover, in isolation, is not a KPI we target. Instead, we consistently strive to enhance gross margin through superior product quality, ongoing cost reduction, patent-protected innovations, and exceptionally high manufacturing efficiencies by global purchasing of quality materials and products, as well as using advanced CNC machining and the development of capabilities that few others possess. All of the above, as well as targeting our overheads to be below a set percentage of sales, is underpinned by a deep-rooted commitment to quality assurance and health and safety. As this is part of our way of life, it has enabled — and continues to enable — the Group to grow strongly and sustainably, and it reflects the deeply-rooted ethos shared by our Directors and employees across Goodwin. We are not overly concerned if competitors read this, as what we have achieved has taken many years to build, and it is this ingrained culture that remains the key to our continued success. The core product contributions, as outlined in our business model on pages 9 to 10, form the foundation of the Group. It is our unwavering commitment to engineering excellence, much of it underpinned by patented technologies, combined with an embedded Group ethos, that gives the Board confidence in the Group’s ability to continue on our growth trajectory. While no business is immune to external risks, the Board believes the Group’s strategy, systems, and culture are uniquely positioned to deliver continued success well into the future. This progress is ultimately made possible by the talent and dedication of our people. It is a testament to their contribution that Group profitability has increased tenfold compared to levels achieved twenty years ago. On behalf of the Board, we express our sincere gratitude to all our employees — both in the UK and overseas — for their ongoing commitment and hard work. T. J. W. Goodwin 29th July, 2025 Chairman Alternative performance measures mentioned above are defined on page 106. 7 GROUP STRATEGIC REPORT GOODWIN PLC SUMMARY OF CONSOLIDATED STATEMENT OF PROFIT OR LOSS for the year ended 30th April, 2025 2025 2024 Note £’000 £’000 CONTINUING OPERATIONS Revenue … … … … … … … … … … 3, 4 219,709 191,258 Cost of sales … … … … … … … … … (128,100) (113,371) GROSS PROFIT … … … … … … … … … 91,609 77,887 Selling and distribution costs … … … … … … … (10,903) (9,618) Administrative expenses … … … … … … … (43,594) (41,374) OPERATING PROFIT … … … … … … … … … 37,112 26,895 Finance income ... … … … … … … … … 7 1,305 1,414 Finance costs ...... … … … … … … ... 7 (2,965) (4,284) Share of profit of associate company … … … … … 14 65 69 TRADING PROFIT … … … … … … … … … 35,517 24,094 Additional year-on-year unrealised (loss) / gain on 10 year interest rate swap derivative … … … … … … (1,257) 113 PROFIT BEFORE TAXATION … … … … … … … 5 34,260 24,207 Tax on profit … … … … … … … … … 8 (8,082) (6,491) PROFIT AFTER TAXATION … … … … … … … … 26,178 17,716 ATTRIBUTABLE TO: Equity holders of the parent … … … … … … … 24,569 16,902 Non-controlling interests … … … … … … … 1,609 814 PROFIT FOR THE YEAR … … … … … … … … 26,178 17,716 BASIC AND DILUTED EARNINGS PER ORDINARY SHARE (in pence) 9 327.17p 224.53p * Finance income and expense for the prior year have been grossed up to be consistent with the current year presentation. The full financial statements and accompanying notes are on pages 50 to 106. 8 GROUP STRATEGIC REPORT OBJECTIVES, STRATEGY AND BUSINESS MODEL The Group’s main OBJECTIVE and PURPOSE is to have a sustainable long-term engineering based business with good potential for profitable growth while providing a fair return to our shareholders. The Board’s VALUES of engineering excellence, quality, efficiency, reliability, competitive price and delivery contribute to the delivery of its strategy. The Board’s STRATEGY to achieve this is: • to supply a range of technically advanced products to growth markets in the Mechanical Engineering and Refractory Engineering Divisions in which we have built up a global reputation for engineering excellence, quality, efficiency, reliability, competitive price and delivery; • to manufacture advanced technical products profitably, efficiently and economically; • to maintain an ongoing programme of investment in plant, facilities, sales and marketing, research and development with a view to increasing efficiency, reducing costs, increasing performance, delivering better products for our customers, expanding our global customer base and keeping us at the forefront of technology within our markets, whilst at all times taking appropriate steps to ensure the health and safety of our employees and customers; • to control our working capital and investment programme to ensure a safe level of gearing; • to maintain a strong capital base to retain investor, customer, creditor and market confidence and so help sustain future development of the business; • to support a local presence and a local workforce in order to stay close to our customers; • to invest in training and development of skills for the Group’s future; • engineering activity and investment into the reduction of CO2 emissions where it is commercially viable taking into account the long-term effects of CBAM (Carbon Border Adjustment Mechanism); • to manage the environmental and social impacts of our business to support its long-term sustainability. BUSINESS MODEL The Group’s focus is on manufacturing within two sectors, Mechanical Engineering and Refractory Engineering, and through this division of our manufacturing activities, our overseas business facilities and our global sales and marketing activities, the Group benefits from market diversity. Further details of our business and products are shown on our website www.goodwin.co.uk. Mechanical Engineering The Group specialises in supplying precision engineered solutions and industrial goods into critical applications, generally on a project basis, more often than not involving the complementary skill set of other group companies to deliver the requirement. The projects normally involve international procurement, high integrity castings, forgings or wrought high alloy steels, carbon fibre composite structures, precision CNC machining, complex welding and fabrication, and other operations as are required. In addition to specialist projects, the Group manufactures and sells a wide range of dual plate check valves, axial nozzle check valves and axial piston control and isolation valves. These solutions and products typically form part of large construction projects, including the construction of naval propulsion and hull components, nuclear waste storage components, liquefied natural gas (LNG), oil and gas and petrochemical, mining, and water markets. We generate value by creating leading edge technology designs and manufacturing processes, globally sourcing the best quality raw material at good prices, manufacturing in highly efficient facilities using up to date technology to provide reliable high performance products to the required specification, at competitive prices and with timely deliveries. The Group through its foundry, Goodwin Steel Castings Limited, has the capability to pour high performance alloy castings up to 35 tonnes net in weight, radiograph and to finish CNC machine and fabricate them at the foundry’s sister company, Goodwin International Limited. This capability is targeting the naval defence industry and nuclear decommissioning, the oil and gas industry, as well as large, global projects requiring high integrity machined castings. 9 GROUP STRATEGIC REPORT OBJECTIVES, STRATEGY AND BUSINESS MODEL (continued) Goodwin International Limited, the largest company in the Mechanical Engineering Division, not only designs and manufactures dual plate check valves, axial nozzle check valves and axial piston control and isolation valves but also undertakes specialised CNC machining and fabrication work for nuclear decommissioning projects. Goodwin International Limited also has a division that is focused on manufacturing / machining high precision, high integrity components for naval marine vessels. Noreva GmbH also designs, manufactures and sells axial nozzle check valves and has built a facility to house machinery that can CNC press polyimide components from the resin produced by Duvelco. Both Goodwin International Limited and Noreva GmbH purchase the majority of their sand mould castings from Goodwin Steel Castings Limited for their ranges of check valves and this vertical integration gives rise to competitive benefits, increased efficiencies and timely deliveries. At Goodwin Pumps India Private Limited we manufacture a superior range of submersible slurry pumps for end users in India, Brazil, Australia, Canada, Peru and Africa. Easat Radar Systems Limited and its subsidiary, Easat Finland Oy, design and build bespoke high-performance radar surveillance systems for the global market of major defence contractors, civil aviation authorities and coastal border security agencies. We create value on these by innovative design, assembly and testing in our own facilities using bought in or engineered in-house components. Duvelco, the newest company within the Mechanical Engineering Division, is a specialist polyimide manufacturer, that will manufacture and sell polyimide resins into an established market. The resin can then be moulded into parts and shapes for the high temperature and critical applications, for which very few polymers can be used. Refractory Engineering Within the Refractory Engineering Division, Goodwin Refractory Services Limited (GRS) generates value primarily from designing, manufacturing and selling investment casting powders, injection moulding rubbers and waxes to the jewellery casting industry. GRS also manufactures and sells these products to the tyre mould and aerospace industries. The Refractory Engineering Division has other than its UK facility, four investment powder manufacturing and sales companies located in China, India and Thailand which sell the casting powders, waxes and moulding rubbers directly and through distributors to the jewellery casting industry and also directly to tyre mould and aerospace industries. These companies are vertically integrated with another of our UK companies, Hoben International Limited (Hoben), which manufactures cristobalite, which it sells to the five casting powder manufacturing companies as well as producing ground silica that also goes into casting powders and other UK uses of silica. Hoben also manufactures different grades of perlite, and a patented range of biodegradable bags, known as Soluform, for use inside traditional hessian / jute bags for the placement of concrete and other materials in or around rivers. Within its Sandersfire division, Hoben also manufactures a unique and comprehensive range of high-quality fire-stopping mortars distributed under the “Firecrete” brand name. Dupré Minerals Limited (Dupré), a refractory company, focuses on producing exfoliated vermiculite that is used in insulation, brake linings and fire protection products, including technical textiles that can withstand exposure to high temperatures. Dupré also sells consumable refractories to the shell moulding precision casting industry. Dupré has designed, patented and sells a range of fire extinguishers and an extinguishing agent for lithium-ion battery fires that utilises a vermiculite dispersion as the fire extinguishing agent. 10 GROUP STRATEGIC REPORT OBJECTIVES, STRATEGY AND BUSINESS MODEL (continued) BUSINESS DIVERSITY AND PERFORMANCE Divisional Split As Goodwin Steel Castings has produced castings of nearly 7,000 tonnes of metal in a single year, 75% more than the average over the last ten years, the split in operating profits has swung in favour of the Mechanical Engineering Division, with the Division now representing 63% (2024: 58%) of the total operating profits before Group centre costs. To provide a level of relativity on the above tonnage, the amount of metal cast by the foundry in the year is approximately the same as the weight of BAE’s 150 metre long, 20 metre wide Type 26 frigate. Whilst the Refractory Engineering Division’s percentage of operating profits are now 37%, this by no means, should be taken as it is not performing. The compound annual growth of the Refractory Divisional Split of Operating Profits (£’000) £30,000 £25,000 £20,000 £15,000 £10,000 10,823 9,2 80 9,139 12, 657 12,171 12, 772 18,861 25,402 £5,000 1 3 , 4 9 2 1 4 , 6 7 1 £0 21 2 3 4 5 2 2 2 2 0 0 0 0 0 2 2 2 2 2 Mechanical Refractory External Revenue: Geographical Segmental Analysis Engineering Division’s profits is 11% over the last ten years and it has consistently delivered respectable profits. Market Sector / Geographical Split The Group continues to have a diversified offering, with it selling a vast range of different product types to a wide variety of different industries and, in the year just finished, it has shipped product to over 100 countries. Due to the increase in US Navy defence contracts being won, the Group’s exports to the United States have increased by 65% to £35 million. Nevertheless, the Group’s activity is well spread 16% 29% 12% 20% 23% United Kingdom Rest of World Pacific Basin Rest of Europe USA geographically as no specific region represents more than 30%, with exports to the United States being only 16% of our turnover. End-User Market Sectors: £220m Revenue KPI A key performance indicator reflecting each of the subsidiaries’ ongoing progress includes the continued improvement in productivity, as demonstrated by the average turnover per employee increasing by 12% to £175,346 per employee. In addition, return on capital employed has risen from 16% to 24% during the year. The Board remains committed to driving further improvements in this important measure of capital efficiency over the years ahead. Workload Given the increasing scale of the Group and its order book, the Board has, for the first time, chosen to disclose the industry breakdown of its current workload, which stands at £287 million as at the time of writing. While the Group has long demonstrated a well- diversified revenue base across industries, the Board is pleased to report that 57% of the forward workload now relates to the defence sector — a reflection of the premium margins our capabilities command in these high-specification markets. With most major nations significantly increasing defence spending as a percentage of GDP, the Group is strongly positioned for further growth in this area, both in terms of activity and profitability. 11 9% 8% 29% 23% 10% 21% Workload - Market Split: £287m Revenue 2% 15% 9% 8% 9% 57% Jewellery Manufacture, Powders, Heat Resistant Applications, Moulds for Tyres & Industry Power, Construction, Radar, Polyimide Defence Oil & Gas, LNG, Petrochemical Nuclear Mining GROUP STRATEGIC REPORT OBJECTIVES, STRATEGY AND BUSINESS MODEL (continued) KEY PERFORMANCE INDICATORS The key performance indicators for the business are listed below: 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Gross profit as a % 37.4 35.5 38.0 42.7 37.0 42.0 41.6 37.0 40.7 41.7 of turnover Trading profit 12.3 9.2 13.3 14.7 12.1 16.5 17.2 18.9 24.1 35.5 (£ millions) Gearing % (excluding 26% 31% 11% 20% 18% 15% 26% 26% 35% 10% deferred consideration) Sales per employee per 105 114 120 117 121 116 130 162 156 175 year (£’000) Dividends proposed 3.0 3.0 6.0 6.9 6.0 7.9 8.3 8.6 10.0 21 (in £ millions) Emissions Intensity 529 471 334 372 313 242 241 141 121 60 (CO2e / £1m Revenue Gross Profit as a % of Turnover Trading profit (£ million) 45% 40 40% 35 35% 30% 30 25% 25 20% 20 15% 37.4% 35.5% 38.0% 42.7% 037.% 42.0% 41.6% 37.0% 40.7% 41.7% 15 10% 10 5% 5 0% 6 7 8 9 0 21 22 3 4 5 0 1 1 1 01 2 2 2 2 0 0 0 20 0 0 0 0 0 2 2 2 2 2 2 2 2 2 1 2. 3 9 .2 1 3 . 3 1 4 .7 1 2 .1 1 6 . 5 1 7 .2 1 8 . 9 2 4 . 1 3 5 .5 6 7 8 9 0 1 2 3 4 5 1 1 1 1 2 2 2 2 2 2 0 0 0 0 0 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 Gearing % (excluding deferred consideration) 35% 30% 25% 20% 15% 10% 26% 31% 11% 20% 18% 15% 26% 26% 35% 10% 5% 0% 6 7 8 9 0 1 2 3 4 5 1 01 1 1 2 2 2 2 2 2 0 0 0 0 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 Funds returned to shareholders (£ million) Revenue per employee per year (£’000) 180 160 140 120 100 80 60 40 105 114 120 117 12 1 11 6 13 0 162 15 6 175 20 0 6 7 8 9 0 1 2 23 4 5 1 1 1 1 2 2 2 2 2 0 0 0 0 0 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 Emissions Intensity (CO2e / £1m revenue) 24 Dividends 600 20 Proposed Dividends 500 16 Share Buy-Back 8 . 9 PRO POS ED 400 12 300 8 200 4 3.0 3.0 6.0 96. 6.0 97. 38. 8.6 10.0 02 1. 100 529 471 334 372 313 242 241 141 121 60 0 0 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 1 1 1 1 2 2 2 2 2 2 1 1 1 1 2 2 2 2 2 2 0 0 0 0 0 0 0 0 0 0 0 0 0 0 20 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 The alternative performance measures referred to above are defined on page 106. The alternative performance measures are important to management and the readers of the Annual Report in assessing the Group’s performance and benchmarking it within its respective industries. 12 GROUP STRATEGIC REPORT OBJECTIVES, STRATEGY AND BUSINESS MODEL (continued) DIVIDEND AND CAPITAL EXPENDITURE POLICY The Board is proposing to amend its Dividend Policy by increasing the payout ratio to 58% of post-tax profits plus depreciation and amortisation, up from the 38% payout ratio that has been maintained since 2018. This proposed increase reflects the Board’s confidence in the Group’s ability to sustainably generate strong cash flows, underpinned by the diversified and recurring nature of the Group’s activities across multiple sectors and geographies. This confidence has been reinforced by a detailed analysis of the Group’s secured workload and the application of extensive financial scenario stress testing. In addition, having reinvested over £200 million during the past two decades into highly efficient, technologically advanced manufacturing plant, equipment, subsidiary growth, and capitalised our intellectual property designs and process as intangibles, the Group now benefits from having the required facilities and operational capacity to support ongoing profitability with only modest levels of future capital expenditure. Importantly, the proposed change in Dividend Policy will not compromise the Group’s longstanding proactive approach to equipment maintenance, facility investment and acquisitions. Management teams will continue to be encouraged to allocate resources and time towards identifying and developing new growth opportunities and product lines. However, at the present time, the major capital projects visible on the horizon are expected to be fully customer-funded, further supporting the Board’s confidence that the revised Dividend Policy remains viable and sustainable for the foreseeable future. Subject to shareholder approval of the proposed dividend at the forthcoming Annual General Meeting on 1st October, 2025, a final dividend of 280 pence per share, (2024: 133p) will be paid in equal instalments of 140 pence per share on 3rd October, 2025 and on or around 10th April, 2026 to shareholders on the register on 12th September, 2025 and on or around 20th March, 2026 respectively. Group Annual Post Tax Profit + Depreciation + Amortisation £40m £35m £30m £25m £20m £15m £10m £5m £0m 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Further details are included in the Alternative Performance Measures on page 106. 13 GROUP STRATEGIC REPORT PRINCIPAL RISKS AND UNCERTAINTIES The Group’s operations expose it to a variety of risks and uncertainties. The Directors confirm that they continue to carry out a robust assessment of the principal risks the Company faces, including those that would threaten its business model, future performance, solvency or liquidity. Market risk: The Group provides a range of products and services, and there is a risk that the demand for these products and services vary from time to time because of competitor action or economic cycles or international trade friction or wars. As shown in note 3 to the financial statements, the Group operates across a range of geographical regions, and its turnover is split across the UK, Europe, USA, the Pacific Basin and the Rest of the World. Operating in many territories helps spread market risk. Similarly, the Group operates in both Mechanical Engineering and Refractory Engineering sectors, mitigating the impact of a downturn in any one product area as has been seen in recent financial years. The potential risk of the loss of any key customer is limited as no single customer accounts for more than 10% of annual turnover. As described in the Business Model, the Group generates significant sales from naval propulsion marine applications and ship hull components as well as from valves it supplies to LNG, oil, chemical and water markets. The Mechanical Engineering Division also sells submersible pumps that are supplied to the mining industries and radar systems that are used for coastal surveillance and air traffic control applications. The Refractory Engineering Division sells vermiculite and perlite to the insulating and fire prevention industry and our investment casting powder companies indirectly sell to the jewellery consumer market through the supply of investment casting moulding powders, waxes, silicone and natural rubber. Technical risk: The Group develops and launches new products as part of its strategy to enhance the long-term value of the Group. Such development projects carry business risks, including reputational risk, abortive expenditure and potential customer claims which may have a material impact on the Group. The potential risk here is seen as manageable given the Group is developing products in areas in which it is knowledgeable, has extensive skill and expertise and new products go through rigorous, extensive testing prior to their release into the market. The risk of product obsolescence is countered by continuous research and development investment into new products. Product failure / contractual risk: The risks that the Group supplies products that fail or are not manufactured to specification are risks that all manufacturing companies are exposed to but we try to minimise these risks through the use of highly skilled personnel operating within robust quality control system environments, using third party accreditations where appropriate. With regard to the risk of failure in relation to new products coming on line, the additional risks here are minimised at the research and development stage, where prototype testing and the deployment of a robust closed loop product performance quality control system provides feedback to the design department for the products we manufacture and sell. The risk of not meeting safety expectations, or causing significant adverse impacts to customers or the environment, is countered by the combination of the controls mentioned within this section and the purchase of product liability insurance. Supply chain and equipment risk: Failure of a major supplier or an essential item of equipment presents a constant risk of disruption to the manufacturing in progress, especially during times of high inflation or increased shipping times and costs. Where reasonably possible, management mitigates and controls the risk with the use of dual sourcing, continual maintenance programmes, and by carrying adequate levels of stocks and spares to reduce any disruption. Health and safety: The Group’s operations involve the typical health and safety hazards inherent in manufacturing and business operations. The Group is subject to numerous laws and regulations relating to health and safety around the world. Hazards are managed by carrying out risk assessments and introducing appropriate controls, as well as attending safety training courses. Acquisitions: The Group’s growth plan over recent years has included a number of acquisitions. There is the risk that these, or future acquisitions, fail to provide the planned value. This risk is mitigated through thorough and robust financial and technical due diligence during the acquisition process and the Group’s inherent knowledge of the markets they operate in. Financial risk: The principal financial risks faced by the Group are changes in market prices (interest rates, foreign exchange rates and commodity prices). As reported, the Company, on 2nd July, 2021 signed a contract to mitigate the impact of interest rate risk by taking out an interest rate swap derivative fixing £30 million of notional debt at less than 1% versus the variable SONIA rate for a period of ten years, commencing 1st September, 2021. Detailed information on the financial risk management objectives and policies is set out in note 27 to the financial statements. The Group has in place risk management policies that seek to limit the adverse effects on the financial performance of the Group by using various instruments and techniques, including credit insurance, stage payments, forward foreign exchange contracts, secured and unsecured credit lines. Prior to the expiry date of the Revolving Credit Facilities, the Board reviews the current and future requirements of the Group and arranges suitable replacement facilities prior to the current facility expiring. Post year-end, the Group has renewed one of its Revolving Credit Facilities, that was due to expire, for a four year term. 14 GROUP STRATEGIC REPORT PRINCIPAL RISKS AND UNCERTAINTIES (continued) Regulatory compliance: The Group’s operations are subject to a wide range of laws and regulations. Both within Goodwin PLC and its subsidiaries, the Directors and Senior Managers within the companies make best endeavours to ensure we comply with the relevant laws and regulations. The Group ensures that high ethical standards and values are adopted, specifically with regards to sanctions, anti-corruption, anti-bribery and human rights. During the year, the Group has carried out training and continued to refine and update its internal policies to reflect the associated risks. IT security: The Group performs regular and remote off-site backups of its IT systems, from time to time engaging external companies to test and report any weaknesses and deficiencies found to enable solutions to be put in place to mitigate and minimise the risk of an IT security breach. Energy and Climate Change: The Group is actively developing and implementing its carbon neutral plan, which helps mitigate the risk of the Group being exposed to the long-term effects of global warming and more specifically the upcoming Carbon Border Adjustment Mechanism (CBAM) taxes that will likely ramp up over the next ten years, in addition to significant increases in the cost of power that are a result of the fragile global energy system. The Group’s methods of mitigation include fixed price energy contracts, incorporating price escalation clauses into the longer term contracts and ultimately reducing the need to purchase energy from the national grid by installing renewable solutions like low cost solar panels. To date, the Group has installed 6.7 MW of solar panels worldwide and planning has been obtained to install a further 4.3 MW of solar panels. Additional information on the Group’s climate related risks and opportunities can be found within the Environmental section, on page 18. 15 GROUP STRATEGIC REPORT CORPORATE SOCIAL RESPONSIBILITY The Board as a whole is responsible for decisions relating to the long-term success of the Company and the way in which their duties have been discharged during the year in terms of the strategic, operational and risk management decisions and these can be found within the Strategic Report on pages 9 to 15. As set out below and in line with Section 172 of the Companies Act 2006, through engagement the interests and views of the Group’s employees and other stakeholders are considered by the Board within its decision-making process as well as the impact they have on the environment, our reputation and the surrounding communities. Unless otherwise stated, the principal decisions made in the year, impacting its stakeholders, were the routine decisions that are made on a year-on-year basis as part of running the business, such as setting the base increase in salaries and increasing the Group’s charitable donations to support the local community in the local Stoke-on-Trent area. The Board also made the decision to proceed with the installation of a 1 MW solar array field, that has taken the Group’s worldwide solar capacity to 6.7 MW and to sign an agreement with a contractor to start planting over 500,000 trees that will be over 80% grant funded, as part of its carbon offset site in Wales. Non-Financial and Sustainability Information Statement As per the latest disclosure requirement, under the Companies Regulations 2022, disclosures on Climate related financial information, Company’s employees, community issues, social matters, human rights and anti-corruption and bribery can be found on pages 16 to 23 of the Annual Report. The Company has implemented a range of policies addressing employee wellbeing, diversity, community engagement, human rights, and anti-corruption, which have led to improved staff retention, stronger community ties, and no reported material breaches or compliance failures during the year. Principal risks in these areas include talent retention challenges, supply chain ethical risks, potential human rights issues in high-risk regions, and exposure to anti-corruption violations. These matters are regularly reviewed through our risk management framework under Board oversight. Employees Health and Safety: The Group acknowledges that many of its manufacturing processes and some materials that it handles and sells are hazardous and that providing a safe environment for people at all of our facilities is an unconditional priority for all of those charged with governance, in addition to each member of the workforce. In the year, as operations change, the Group has managed the continually evolving risks that are inherent in manufacturing businesses by ensuring risk assessments are carried out by all departments as soon as an operational change is envisaged. Such assessments enable the introduction of the appropriate controls to help ensure that the workforce is protected from foreseeable hazards. Furthermore, awareness and training to continually reduce risk and improve safety is a mind-set that is reinforced on a daily basis through the Group’s global “Safety Spectrum” programme. Employee consultation: The Group takes seriously its responsibilities to employees and, as a policy, communicates with employees systematically with information on matters of concern to them. It is also the policy of the Group to consult where appropriate, on an annual basis, with employees or their representatives so that their views may be taken into account in making decisions likely to affect their interests. The Board considers the most effective form of engagement and involvement of its employees for its size and complexity is by way of informal daily discussions between the employees, the Senior Management and Board members who walk the floor, and the Company encourages its employees through its salary and bonus arrangements. Engagement in the year is further supported through workforce representative meetings, local working groups, team meetings, training, and an honest and open culture. Employment of disabled persons: The policy of the Group is to offer the same opportunity, including training, development and promotion, to disabled people, and those who become disabled, as to all others in respect of recruitment and career advancement, provided their disability does not prevent them from carrying out the duties required of them in accordance with the requirements of the Equality Act 2010. Diversity Policy: The Group is committed to promoting diversity of gender, social and ethnic backgrounds and personal strengths, in addition to ensuring that everyone has the same opportunities for employment and promotion based on ability, qualifications and suitability for the work in question. The Group invests in training and development of skills for the Group’s future and has a long-term aim that the composition of our workforce should reflect that of the community it serves. The Group continues to strive to improve the balance of diversity by reviewing gender reporting and promoting diversity through training and development, recruitment, our business culture and the Board’s Strategy. Whilst the two independent director roles are held by Mrs. J. E. Kelly and Ms. C. A. McNamara, following the assessment that was carried out on 30th April, 2025, the Board does not comply fully with the “comply or explain” listing disclosure requirements that have come into effect, which require 40% of the Board to be female and for at least one Board member to be from an ethnic minority background. Whilst we fully acknowledge the necessity and benefits of a diversified leadership, we are unable to currently meet these specific targets due to the Board consisting of primarily executive Directors because of its size and complexity, as set out on page 24. This coupled with the fact that the appointments of the Board are made with the utmost consideration for the individual’s qualifications, experience, and ability to contribute to the strategic direction of the Company, we have found ourselves at present, based on these criteria, unable to make the necessary adjustments without compromising the integrity and efficiency of our Board. Nonetheless, we are continually examining ways of meeting these requirements over the long term by continuing to promote diversity at all levels of the Company, whilst also maintaining the Board’s dynamism and the required level of experience, ability and qualifications. The latest development is that on 2nd October, 2024, the Board appointed one additional Non-Executive Director to the Board, Ms. C.A. McNamara, who, with effect from 30th April, 2025, sits on the Audit Committee along with Mrs. J. E. Kelly and the Group Chairman, thereby putting the Group in line with Audit Committee composition requirements, as set out within The Listing Rules. 16 GROUP STRATEGIC REPORT CORPORATE SOCIAL RESPONSIBILITY (continued) Diversity Policy: (continued) The following tables set out the breakdown of our average number of employees and Board members by gender and age: Breakdown by gender Main Board and Senior Employees Total Year ended 30th April, 2025 Company Secretary Management Number of female employees 3 15 200 218 Number of male employees 5 73 957 1,035 Total number of employees 8 88 1,157 1,253 % of female employees 38% 17% 17% 17% % of male employees 62% 83% 83% 83% Breakdown by age Main Board and Senior Employees Total Year ended 30th April, 2025 Company Secretary Management Number of employees aged 16-21 - - 96 96 Number of employees aged 22-40 2 14 543 559 Number of employees aged 41-65 5 66 499 570 Number of employees aged over 65 1 8 19 28 Total employees 8 88 1,157 1,253 % aged 16-21 - - 8% 8% % aged 22-40 25% 16% 47% 45% % aged 41-65 62% 75% 43% 45% % aged over 65 13% 9% 2% 2% Suppliers, Customers and Regulatory Authorities The Board considers market trends regularly and reviews their likely long-term implications. Our business relationships and procedures are developed over time and are regularly reviewed to ensure as a Group we conduct business responsibly and sustainably. The Board, through its legal and compliance teams, continually monitors changes in legislation and is committed to complying with all legal and regulatory requirements. Additionally, it acquires a first-hand understanding of its business relationships and compliance through regular dialogue and site visits where appropriate. Engagement is ensured from the initial tender processes to embedded sales and engineering project meetings and reinforced by an open-door culture, whilst actively seeking feedback. The five Executive Directors of the Board are actively involved with the day to day business and management of the subsidiaries thereby allowing a good understanding of key members of the supply chain and also ensuring a fair purchase culture. Maintaining High Standards of Business Conduct Ethics and Sustainability: We are committed to conducting business responsibly and ethically. We endeavour to ensure that our staff, suppliers and business partners adopt the same or similar high ethical standards and values. This applies, but is not limited to human rights, modern slavery, anti-bribery and corruption and compliance with all applicable sanctions regimes. These principles are supported by an anonymous whistle-blowing system, which is routinely reviewed and independently investigated if required. Shareholders: Shareholder engagement occurs through the Annual Report, regulatory disclosures, our website, site visits and the Annual General Meeting, coupled by supplementary RNS announcements made during the course of the year. Throughout the year, the Chairman, on behalf of the Group, maintains an active dialogue with its shareholders, in order to understand their views on governance and performance against the strategy, as well as providing its investors, including institutional investors, an opportunity to ask questions, discuss the performance of the Group and make suggestions. Further engagement is obtained through shareholder site visits, which are hosted directly by the Chairman and the other members of the main Board. The Board aims to accommodate such requests as and when they are appropriate to do so. The Group’s Directors and Non-Executive Directors are also available before and after the Annual General Meeting to discuss any matters shareholders might wish to raise. Such regular first-hand engagement with shareholders enables the Chairman to provide the Board with updates so the views of shareholders are taken into consideration. The Company has one class of ordinary shares, which have the same rights as regards voting, distributions and on liquidation. Management are also significant shareholders in the Company, holding approximately 54.3% (2024: 54.0%) of the register. In accordance with LR6.5, there is a controlling shareholder agreement in place. 17 GROUP STRATEGIC REPORT CORPORATE SOCIAL RESPONSIBILITY (continued) Maintaining High Standards of Business Conduct (continued) Shareholders (continued) Executive Directors M. S. Goodwin, S. R. Goodwin, B. R. E. Goodwin and T. J. W. Goodwin are party to the controlling shareholders agreement, as well as former Executive Directors’ (J. W. Goodwin and R. S. Goodwin) who were Audit Committee members up to the 30th April, 2025. On this basis the Board feels that the Executive Director’s vision is fully aligned with shareholders. Communities: During the year the Group has continued to communicate to all employees our culture of responsibility and support for local communities where possible. The Board encourages its sites to support their local communities through charitable activities and initiatives to support the local area within which they operate. Engagement occurs through dialogue with the local councils and charities. Donations: The Group made no political donations during the year (2024: £nil). Donations by the Group for charitable purposes amounted to £170,000 (2024: £119,600). The majority of these were made to local communities within the Group’s operating environments. Environment – Task Force on Climate-related Financial Disclosures (TCFD) The following report includes the climate-related financial disclosures that are consistent with the eleven TCFD recommendations. Climate change is a core challenge for the Group, as we transition and work towards becoming a carbon neutral Group, whereby the carbon emitted from our activities is reduced and/or balanced by absorbing carbon emissions. As an engineering Group, that includes a heavy goods steel foundry and high temperature refractory processing business, the consumption of energy is an integral feature in the manufacture of the complex products that are manufactured by the business. Over the past few years the Group has been actively developing and implementing our carbon neutral plan and following a group wide assessment, we have set a target of becoming carbon neutral by 2035. The initiative consists of five mechanisms to achieve our carbon neutral target: Initiative Description Achievements to date Future Plans Mechanism Reduce Taking engineering steps We have implemented a range Ongoing monitoring, review Consumption to reduce our consumption of energy efficiency measures, of plant and modifications to (Scope 1 & 2 of gas and electricity in our including the transition to electric our manufacturing processes companies by investing in company vehicles, installation of to reduce our overall energy emissions) more efficient plant and / automated lighting and switch-off usage, CO2 emissions and or changing our working systems, base load monitoring, waste. practices. replacement of heavy-duty fans, and the use of inverters to improve power efficiency through speed control. These modifications have resulted in a sustained reduction in electricity consumption of over 10%. The latest reduction relates to manufacturing process changes. Renewables Utilisation of self- To date, the Group has installed The Group is ready to install generated power through 6.7 MW of solar panels across its an additional 4.3 MW of solar the use of solar panels and operations, resulting in a nearly 30% capacity; however, the project is wind turbines. reduction in electricity purchased prevented from proceeding due from the grid compared to pre- to a nearby sub-station needing installation levels. to be upgraded, which we have Planning permission has also been been informed by the National Grid is planned for 2037. secured for an additional 4.3 MW solar installation at the Brassington The potential installation of site. two onshore wind turbines at Hoben International has also been assessed, with a decision on planning linked to securing grant funding for a hydrogen power generation unit that could enhance overall project viability. 18 GROUP STRATEGIC REPORT CORPORATE SOCIAL RESPONSIBILITY (continued) Environment – Task Force on Climate-related Financial Disclosures (TCFD) (continued) Initiative Description Achievements to date Future Plans Mechanism Hydrogen Finding and investing in Following extensive research with Continue to seek alternatives a hydrogen generation the use of a wind and solar powered to operating a 1580 degree power plant solution that electrolysis machine, hydrogen Celsius process without the use can replace the natural gas was identified as a carbon free of natural gas and / or obtain utilised in our more energy alternative for our continuous gas Government support for a green intensive processing burning process. A bespoke first hydrogen plant. activities. in class solution was designed but following two unsuccessful grant applications the project is on hold due to it not being commercially viable without the support of Government. Offsetting Investing in land suitable Recognising that the Group cannot The Group will ensure that for planting trees to offset fully eliminate its carbon footprint tree planting is carried out in the CO2 that is generated through operational reductions accordance with the terms from activities that cannot alone, a 1,180-acre site in Wales of the signed contract. An be removed by the above has been acquired, with planning application for grant funding three mechanisms. permission secured to plant over to support Phase 2 will be 500,000 trees. This afforestation submitted once the next project is expected to generate funding window opens. approximately 120,000 tonnes of In parallel, we continue to CO2 offset credits over the next monitor developments in fifty-five years—more than offsetting the carbon pricing market, the gas consumption of our steel including the evolving UK foundry, the largest gas user carbon tax regime and Carbon within the Mechanical Engineering Border Adjustment Mechanism Division. (CBAM) requirements, to A contract has now been signed support the strategic value and compliance role of our with a specialist contractor to deliver offsetting initiatives. the planting over two phases, with the first phase scheduled to begin in October 2025. The Group has also secured grant funding to cover the majority of costs associated with phase one of the scheme. 3rd Party Take strategic steps to A specialist third-party contractor The Group is finalising a Emissions reduce Scope 3 emissions has been engaged to assess the comprehensive Scope 3 (Scope 3 that are produced not Group’s operational carbon footprint emissions assessment for by the Company itself in the UK, with the assessment now its UK operations, which will emissions) but by those indirectly in its final stages and expected to inform targeted medium-term responsible within its be completed within the next two reduction KPIs. The Board value chain. months. As part of this work, the will review the findings and Group has developed a draft Scope incorporate them into decision- 3 emissions plan and has begun making to reduce emissions quantifying emissions across the where reasonably practicable. corporate value chain for two of A similar assessment will its major subsidiaries. A hybrid follow for the Group’s overseas approach has been adopted, using operations to create a full primary data where available and Group-wide emissions profile supplementing with secondary and support a consistent data or financial modelling through approach to emissions approved Scope 3 evaluation management. software when necessary. During the year Goodwin Steel Castings, through process modifications, has achieved a significant reduction in its indirect emissions, that are emitted during the process of melting. This has resulted in the Group’s overall Scope 1 and 2 emissions reducing by 71% over the last five years, despite its activity in terms of revenue having increased by 52%. This achievement is highlighted through the Intensity Ratio that the Board uses as its key environmental KPI to measure its performance within this area. Since April 2019 the Intensity Ratio has reduced by 84% from 371 tonnes per £1 million to 60 tonnes per £1 million of revenue. The reason why we are only taking a fifty-five year view on the offsetting produced by the woodland project, despite the fact that it will generate credits for one hundred years, is that by 2079 all electricity, used by the Group, will be generated by green methods and all hydro carbon needed for very high temperature processing applications is expected to have been converted to hydrogen, which will be generated using green electricity. 19 GROUP STRATEGIC REPORT CORPORATE SOCIAL RESPONSIBILITY (continued) Environment – Task Force on Climate-related Financial Disclosures (TCFD) (continued) Governance The Board has overall accountability for the management of all climate change-related risks and opportunities, as well as overseeing the implementation, monitoring, and delivery of our climate goals. Day-to-day climate-related responsibilities are coordinated by senior operational management, supported by functional leads across sustainability, engineering, and finance, who report to the Board on implementation progress. Climate-related risk is addressed as a standalone agenda item and receives regular attention through updates from individuals across the Group with designated climate-related responsibilities. These updates are provided proactively as material matters and opportunities arise and are subsequently shared with the full Board to inform decision-making. Over the past year, the Board considered several key climate-related matters, including capital allocation for the installation of additional solar panels along the canal side adjacent to the foundry, the negotiation of energy pricing agreements, the impact of non-commodity energy charges, and the ongoing monitoring and collection of Scope 3 emissions data. The Group’s Audit Committee continues to support the Board by ensuring that climate- related issues are embedded within the Group’s wider activities and risk management framework, as well as by reviewing and recommending relevant policy proposals for Board approval. Risk Management Climate change related matters are monitored by the Board and Audit Committee to ensure that they are embedded in our risk management and planning process, in addition to our long-term strategic decision-making. Initially, climate-related risks are identified through a combination of engagement, industry benchmarking, and analysis of regulatory and environmental trends. This involves gathering insights from various sources, including scientific research, policy developments, and input from key stakeholders. Once identified, these risks are evaluated based on their potential financial and operational impacts using a materiality assessment. Furthermore, the Board is directly able to determine which risks and opportunities could have a material impact on the Group, as well as how to prioritise them, by having a flat management structure and taking a hands-on approach so that they are actively immersed within all aspects of the business and each subsidiary. It is the opinion of the Board that, with the Group’s activities on green projects, climate change will have no significant effect on the Group’s financials, including: 1. Contract profitability: whilst there will be fewer contracts for the oil and gas markets, we have already substituted a significant proportion of these contracts with new naval propulsion and hull component supply and nuclear waste storage component activity. Although cost increases can be expected, the Group has the ability to pass these costs on to the customers through the use of short validity periods on quotes as well as building in escalation clauses within its longer term contracts. The fact that it is Group policy to manufacture and sell products with high technology and high gross margins assists in insulating the Group from high energy costs. 2. Going Concern of any Group company: as bank facilities will continue to be available and with the Group’s strong cash generation, it has the ability to reduce its debts at a faster rate, should it so wish. 3. Cash flow: generating our own green electricity is a much lower cost than buying electricity from the grid and our investments are self-financing and will ultimately save the Group significant money over the life of those assets and projects. 4. Carrying value and useful economic life of the Group’s plant and equipment, investment and intangibles. Had we still been heavily dependent on oil and gas project contracts and had done nothing on green power investments the stated situation above would be different. Metrics and Targets Due to the diversification of our products and markets and for the type of energy intensive company it is, the Board has determined that the total of Scope 1 and Scope 2 emissions versus alternatives is the most appropriate metric to use to assess climate-related risks and opportunities in line with its strategy and risk management process. The Group’s key performance business metric is tonnes of CO2 emitted per £1 million pounds of turnover of the Group. See the following for a graphical disclosure of our historic emissions, achieved reduction and forecast target of being carbon neutral by 2035. 20 GROUP STRATEGIC REPORT CORPORATE SOCIAL RESPONSIBILITY (continued) Environment – Task Force on Climate-related Financial Disclosures (TCFD) (continued) Scope 1 and 2 Emissions Data 40,000 300 Intensity Reported 30,000 TonnesofCO 200 Turnover)£1 mper(Tonnes 2 20,000 100 10,000 0 0 2021 2022 2023 2024 2025 Scope 1 27,293 29,301 21,562 18,517 8,288 Scope 2 5,176 5,214 4,440 4,622 4,869 Intensity 242 241 141 121 60 (CO2/£1m revenue) MWh 69,737 67,738 59,285 60,314 55,126 Scope 1: Direct Emissions These are emissions that result from company owned machinery, facilities and vehicles Scope 2: Indirect Emissions These are emissions associated with the use of generated electricity from offsite sources for activities within the company sites. Scope 2 emissions have been calculated on a location basis. 76% of the emissions and MWh consumed are related to UK operations for the year ending 30th April 2025 Reported 2 Tonnes of CO 13,000 10,400 7,800 5,200 2,600 0 2025 Data Alternative & Resulting Carbon Renewable Energy Offset Neutral Goal Scope 1: Woodland 16% Direct Emissions Solar & 24% Renewable 65% Hydrogen 0% 53% Technology Scope 2: (Government Backed) Carbon Indirect Emissions Neutral 35% Plant Efficiency & Working 7% 2035 Practice Improvements TARGET 100 80 60 Perce ntage 40 of Forecast CO 2 20 0 Carbon Neutral target, whilst possible, is heavily dependent on our gas usage and the Government providing support to industry to bridge the cost gap that will enable companies to invest in alternatives such as green hydrogen. Until this occurs, the Group will not be able to reach its carbon neutral target as incurring the full cost that would be involved would be unviable and not possible. We calculate our GHG emissions using the GHG Protocol Corporate Accounting and Reporting Standard (revised edition). Strategy In line with the Task Force on Climate-related Financial Disclosures (TCFD) reporting requirements and based on a detailed assessment aligned with TCFD guidance, we have identified and evaluated the short, medium, and long-term climate-related risks and opportunities that may impact our business. These climate-related factors are integrated into our broader strategic planning and financial reporting processes. Specifically, material climate-related risks and opportunities are assessed for their potential financial impact and used to inform critical judgments, including asset 21 GROUP STRATEGIC REPORT CORPORATE SOCIAL RESPONSIBILITY (continued) Environment – Task Force on Climate-related Financial Disclosures (TCFD) (continued) Strategy (continued) valuations, impairment assessments, and capital allocation decisions. This ensures that our financial disclosures reflect the implications of climate-related scenarios where relevant. To prioritise these risks and opportunities, we apply a structured approach that considers the likelihood, magnitude of financial impact, and the time horizon over which they may occur. This includes both transition risks (such as regulatory changes and evolving market expectations) and physical risks (such as extreme weather events), as well as opportunities related to energy efficiency, innovation, and sustainable market growth. The prioritisation process is reviewed periodically to ensure alignment with the evolving climate landscape and stakeholder expectations. The following table outlines the current short, medium and long-term climate-related risks and opportunities identified by the Group, and how they are incorporated into our strategic planning and financial risk management processes: TCFD Potential Impact Financial Business Resilience Scenario Time Category Description Magnitude / Readiness ** Frame Ongoing - woodland High but offset programme & reduction activities. Pricing of GHG Risk: Direct requirement to pay carbon Short to reducing Mitigated under & L e g al <2°C with emissions taxes per tonne emitted. Medium activity from Gov. of carbon these scenarios by neutral the likely support Pol icy Green Hydrogen technology. Higher Risk: Increasing building, operation and transport standards leading increased environmental <2°C Short Medium Manage investment into equipment and higher standards supply chain and material costs. Shifts Electrification Opportunity: Increased sales of AVD for Short to – growth in EV use on lithium ion battery fires. <2°C Medium High Monitor T e c h n o l o g y transport alternative. Substitution of Opportunity: Transition high temperature gas powered <2°C Medium Medium Monitor technology manufacturing processes onto a green Dem and Transition Risk: Reduced gross margin from sales away from >2°C Medium Low Manage of valves to the oil and gas industry fossil fuels End Increased Risk: Impact on the availability and <2°C Medium Low Manage cost of raw pricing of key raw materials due to materials transitional and physical risks. Risk: Access to the financial industry Balance and R e p u t a t i o n a l Cost of Capital and credit becomes tied to high levels >3°C Medium High Reduce Initiative Employee Risk increasing concerns of working for a >3°C Long Low of sustainability performance. Reduce Initiative Risk: Attracting the highest levels Balance and of talent could be difficult due to carbon neutral company. Risk: Damage to physical assets and >3°C Medium High Geographical P h y si c al Climate Events loss of revenue >3°C Medium Low diversification plans Natural / <2°C Long Low Insurance Extreme Business Continuity Opportunity: Increased demand for submersible pumps for disaster relief <2°C Long Low Monitor * Short < 5 years Medium – up to 2035 Long – 2035-2050 22 GROUP STRATEGIC REPORT CORPORATE SOCIAL RESPONSIBILITY (continued) Environment – Task Force on Climate-related Financial Disclosures (TCFD) (continued) Strategy ** Scenarios: Scenario analysis showed that under a <2°C transition pathway, energy costs could rise by up to 40%, with carbon pricing potentially posing a material risk to gas-intensive operations. In response, the Group has continued to enter into long-term energy price agreements to manage cost volatility and protect profitability, while also benefitting from the significant renewable investments already made to date. Under such a scenario grant funding for Hydrogen projects is likely, which would enable the Group to meet its net zero target by 2035. Under a >3°C scenario, rising physical risks have reinforced our focus on operational diversification and continuity planning. Carbon credits from the Group’s woodland project are expected to offset potential future costs if carbon pricing is extended to individual emitters. For assessing the two scenarios and the impact of climate change on our business, we have completed in-house assessments. The inputs included reviews of our product groups and our manufacturing sites. It was carried out by the Board and senior management as well as having input from third party specialists as and when it has been required. The source of the scenarios utilised has been a combination of publicly available ones that have been developed by policy groups, which we have then adapted to be company specific. For further details on the business resilience and the measures being taken to increase the Group’s resilience to the identified climate change risks, see page 15. The measures include reducing consumption of power through process modifications, utilisation of renewables and hydrogen, carbon offsetting via a woodland project and working with our value chain. ** Hot House World (>3°C) This scenario reflects a fragmented world with limited international cooperation and weak climate ambition. It assumes minimal progress on emissions reductions, resulting in a trajectory that leads to global temperature rises exceeding 3ºC by the end of the century. Under this scenario, physical climate risks—such as extreme weather events, heat stress, and sea level rise—intensify significantly. The Group uses this scenario to stress test the resilience of its assets and operations to acute and chronic physical climate impacts in a high-warming environment. The scenario assumptions are in line with IPCC SSP3-7.0. ** Sustainable Development (<2°C) Aligned with the IEA Sustainable Development Scenario (SDS), this scenario assumes strong and coordinated global climate action. It models a pathway consistent with limiting global temperature rise to well below 2ºC, including widespread decarbonisation, rapid adoption of low-carbon technologies, and successful implementation of net zero pledges. This scenario is used to assess transition risks and opportunities—such as shifts in policy, carbon pricing, and market demand— and to evaluate the Group’s strategic and financial resilience in a low-carbon future. FORWARD-LOOKING STATEMENTS The Group Strategic Report contains forward-looking type statements and information based on current expectations, and assumptions and forecasts made by the Group. These expectations and assumptions are subject to various known and unknown risks, uncertainties and other factors, which could lead to substantial differences between the actual future results, financial performance and the estimates and historical results given in this report. Many of these factors are outside the Group’s control. The Group accepts no liability to publicly revise or update these forward-looking statements or adjust them for future events or developments, whether as a result of new information, future events or otherwise, except to the extent legally required. The Group Strategic Report was approved by the Board on 29th July, 2025 and is signed on its behalf by: T. J. W. Goodwin M. S. Goodwin S. R. Goodwin Director Director Director 23 DIRECTORS’ REPORTS REPORT OF THE DIRECTORS The Director’s have pleasure in presenting their reports and audited financial statements for the year ended 30th April, 2025. The Directors’ have presented their Group Strategic Report on pages 3 to 23, which contains the Group’s Objectives, Strategy and Business Model. The Group Strategic Report is intended to be an analysis of the development and performance of Goodwin PLC and details the principal risks and uncertainties facing the Group and an indication of likely future developments and the required statements under Statutory Instrument 2008/410 Schedule 7 of the Companies Act 2006. The Chairman’s Statement is part of the Group Strategic Report and provides the financial review, including some of the key performance indicators and future trends of the business. Also included in the Group Strategic Report for the year are the Group’s Objectives, Strategy and Business Model on page 9, Principal Risks and Uncertainties on pages 14 and 15, and the Corporate Social Responsibility Report on pages 14 to 15. The Board considers that the Chairman’s Statement, the Group Strategic Report, the Directors’ Reports and the Financial Statements, taken as a whole, in their opinion, are fair, balanced and understandable and that they provide the information considered appropriate for shareholders to assess the Group’s position and performance during the financial year and at the year end, and to assess the business model and strategy. Proposed ordinary dividends The Directors’ recommend that an ordinary dividend of 280 pence per share (2024: 133p) be paid in equal instalments of 140 pence per share on 3rd October, 2025 and on or around 10th April, 2026 to shareholders on the register on 12th September, 2025 and on or around 20th March, 2026 respectively. The ordinary dividend is subject to the approval of the shareholders at the Annual General Meeting on 1st October, 2025. See comments on page 13 regarding the Dividend Policy. Directors The Directors of the Company who have served during the year are set out below. M. S. Goodwin (Mechanical Divisional Managing Director) S. R. Goodwin (Refractory Divisional Managing Director) T. J. W. Goodwin (Chairman) B. R. E. Goodwin N. Brown J. E. Kelly (Non-Executive Director) C. A. McNamara (Non-Executive Director) - Appointed on the 2nd October, 2024 The Chairman and the Divisional Managing Directors do not retire by rotation. No Director has a service agreement with the Company, nor any direct beneficial interest in the share capital of any subsidiary undertaking. The Chairman does not have any other significant external appointments. Shareholdings The Company has been notified that as at 25th July, 2025, the following had an interest in 3% or more of the issued share capital of the Company: M. S. Goodwin, S. R. Goodwin, T. J. W. Goodwin and B. R. E. Goodwin 3,755,161 shares (50.0%); these shares are registered in the name of J. M. Securities (No. 3) Limited. J. H. Ridley 501,709 shares (6.68%) Rulegale Nominees Limited (JAMSCLT) 343,034 shares (4.57%) and Interactive Investor Services Nominees Limited (SMKTISAS) 225,822 shares (3.01%). In line with LR 9.2.2AD R (1), relating to Controlling Shareholders, the Company confirms that a written and legally binding agreement is in place, and has complied with the independence provisions set out in LR 6.5.4 R. The Company confirms that, as far as it is aware, the controlling shareholders have complied with the agreement. Share capital The Company’s issued share capital comprises a single class of share capital which is divided into ordinary shares of 10p each. Information concerning the issued share capital in the Company is set out in note 25 to the financial statements on page 82. All of the Company’s shares are ranked equally and the rights and obligations attaching to the Company’s shares are set out in the Company’s Articles of Association, copies of which can be obtained from Companies House in England and Wales or by writing to the Company Secretary. The Directors of the Company do not have any on-going powers in relation to the purchase of its own shares and there are no restrictions on the voting rights of shares and there are no restrictions in their transfer other than: • certain restrictions as may from time to time be imposed by laws and regulations (for example, insider trading laws); and • pursuant to the Market Abuse Regulation whereby Directors of the Company require approval to deal in the Company’s shares. Additionally, the Company is not aware of any agreements between shareholders of the Company that may result in restrictions on the transfer of ordinary shares or voting rights. 24 DIRECTORS’ REPORTS REPORT OF THE DIRECTORS (continued) Research and development Significant investment in research and development remains a strategic priority for the Group. During the year, the most material initiatives with potential for substantial benefit included: Metallurgical advancements, specifically the development of novel production techniques to demonstrate the up -scaling capability of a high alloy material in relation meeting industry needs for the latest designs within power generation sector. The techniques enhance our ability to meet the tighter tolerance chemistry requirements of the material and thermodynamic predictions have been used to optimise heat treatment parameters to improve the period strength and ductility of the parent material. Easat Radar Systems has enhanced its drone and coastal surveillance system, as a result of always having manufactured high gain antennas, by developing a dual beam surveillance system that can now detect not only sea-borne targets but also small air targets such as drones, paragliders and small aircraft. The development has focused on reducing unwanted sea clutter, through the use of dual beams and dedicated receiver channels allowing independent processing in order to enable optimum coverage of both sea and air. Other investments also include further development of alternative polyimide chemistries targeted towards niche end-users utilising advanced technologies and development of a concentric control valve with a high turn down rate that will enable gas applications users to avoid the requirement of a bypass line. Change in control The Group’s committed loan facilities include a change of control clause, which states that a change of control of the parent Company will be classed as an event of default and would enable the providers at their discretion to withdraw the facilities. Stakeholders relations All shareholders are encouraged to participate in the Company’s Annual General Meeting. No shareholder meetings have been called to discuss any business other than ordinary business at the Annual General Meeting. The Board complies with the recommendations of the UK Corporate Governance Code that the notice of the Annual General Meeting and related papers should be sent to shareholders at least twenty working days before the meeting. The Directors attend the Annual General Meeting. The Chairman and other members of the Board and the Chair of the Audit Committee and Audit Committee members will be available to answer questions at the forthcoming Annual General Meeting. In addition, proxy votes will be counted and the results announced after any vote on a show of hands. The Chairman ensures that the views of shareholders are communicated to the Board as a whole, ensuring that Directors develop an understanding of the views of shareholders. Any individual requests for information from shareholders are dealt with by the Chairman, and where any such requests are subject to restraint in that where any disclosure would give rise to share price sensitive information, then the requests would be declined, or referred to the Board for release to all shareholders through the Stock Exchange RNS. Engagement with the Group’s suppliers, customers and other stakeholders can be found within the Strategic Report on pages 16 to 18. Going concern The Directors, after having reviewed the Group forecasts and possible challenges that may occur over the short to medium term, are confident that the Group has adequate resources to continue to operate for at least twelve months from the date that these financial statements are approved and have continued to adopt the going concern principle in preparing these financial statements. As at 30th April, 2025, the Group’s gearing ratio stood at 9.9% (2024: 35.1%), which is due to a reduction in net debt of £29.3 million against a substantial shareholder’s net worth of £138 million (2024: 122 million). The retained reserves of the Group and increased headroom in lender facilities put it in a strong position to deal with any material unforeseen adverse issues that may occur and have an impact on the Group’s operations. As part of the going concern process, the Group forecasts are stress tested by being subject to a number of severe but conceivable financial challenges to ensure that the Group finances remain robust throughout the period being tested. The stress test model begins with the Group forecasts, that have been consolidated from the individual forecasts generated by the Directors of each of the subsidiaries and reflects their specific knowledge of their business and the markets, within which they operate, to ensure that the forecasts that they produce reflect the market conditions, the business strategy and expected outlook. Each of these subsidiary level forecasts is then reviewed, challenged and approved by the relevant Divisional Managing Director, who is immersed in each of these businesses to such an extent that they know and understand each of their markets. As the Group is so diverse, with two divisions in different sectors and multiple products within each division, several stress test events are used to reduce the pre-tax profit forecasts by reducing revenues and consequently the pre-tax profit. Due to this diversity, it is feasible that one or two events could take place, but it is highly improbable that all the stress test events would occur at the same time. The stress tests implemented reduced revenues and consequently pre-tax profits, which for these stress tests implemented reduced pre-tax profit by a combined amount of 74%, without reducing the discretionary capital expenditure programme, maintaining overheads at their current expected levels, maintaining the dividend policy and utilising the finance facilities at the same amounts that will be in place twelve months from the signing of these accounts. The results of the stress test modelling did not highlight any going concern issues, breaches of covenants, need to reduce the discretionary capital expenditure, make any changes to overheads, reduce or cancel the payment of a dividend and / or the requirement for any further financing facilities in addition 25 DIRECTORS’ REPORTS REPORT OF THE DIRECTORS (continued) Going concern (continued) to those currently in place at year end. Post year end, the Group has renewed one of its Revolving Credit Facilities, that was due to expire, in July 2025, for a four-year term. Whilst our carrying values of trade debtors and contract assets are significant, we see little risk here in terms of recovery due to the quality of the customers that the Group contracts with. Where possible, we credit insurance for the majority of our trade debtors and our pre-credit risk (work in progress), and for significant contracts where credit insurance is not available, we ensure, where possible, that those contracts are backed by letters of credit or cash positive milestone payments. As discussed elsewhere within these accounts, the Mechanical Engineering Division’s order book remains high and the Refractory Engineering Division continues to be buoyant. The Directors are confident that the Group and Company will have sufficient funds to continue to meet their liabilities as they fall due for at least twelve months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis. Viability Statement In accordance with Provision 31 of the UK Corporate Governance Code the Directors have assessed the Group’s viability over a three year period to 30th April, 2028. While the Board has no reason to believe that the Group will not be viable over a longer period, the Board believes that a three year review period is prudent, and provides the readers of the report with a degree of confidence of the longer viability of the Group. In addition to the going concern review process, the Board has considered the impact of several possible adverse events over an extended period (two more years, taking the total review period to 30th April, 2028), where it has predicted a severe reduction in the pre-tax profit forecasts for each year. These extended possible adverse event scenarios, using the same logic as outlined in the stress model within the going concern review section, have been modelled by reducing revenues each year that consequently reduce pre-tax profits by an average amount of 78% each year from the base case forecast. The Board did see that the extended stress testing modelling would require lower capital expenditure than under non stress test circumstances over three years, but they did not foresee any reductions in either the Group overheads or the a change in dividend policy, which both could be reduced to offset an extended downturn in pre-tax profits, if required. The results of the stress testing showed that the Group did not breach any of its banking covenants and has sufficient financing facilities in place to deal with these extended adverse events and, given that the majority of the capital expenditure policy is discretionary, the amounts included could be reduced further and there could be a review of both the overheads and dividend policy which could be changed accordingly. Further resilience is obtained from the diversification of the Group, as explained in more detail within the Going Concern commentary. The workload within the Mechanical Engineering Division remains high and this is underpinning the performance in the short to medium term. The Refractory Engineering Division remains buoyant in its core traditional sectors as well as having additional newer products, that are gaining traction within their market sectors. The Directors are therefore able to confirm that they have a reasonably confident expectation that the Group will be able to continue in its operations and remain financially viable over this extended period to 30th April, 2028. Corporate governance statement The Company’s Corporate Governance Statement is set out on pages 27 to 30 and forms part of the Directors’ Report. Financial Risk Management The Group has in place risk management policies that seek to limit the adverse effects on the financial performance of the Group by using various instruments and techniques, further details can be found within note 27 on page 90. Subsequent events After the balance sheet date an ordinary dividend of 280p per qualifying ordinary share was proposed by the Directors (2024: Ordinary dividend of 133p). After the year end, the Group has renewed revolving credit facility, that was due to expire in July 2025, on a four-year term, as a prudent policy to ensure that guaranteed facilities and the appropriate level of headroom is available to the Group. Auditor In accordance with Section 489 of the Companies Act 2006 and the recommendation of the Board of Directors, a resolution is to be proposed at the Annual General Meeting for the re-appointment of RSM UK Audit LLP as auditor of the Company. Approved by the Board of Directors and signed on its behalf by: T. J. W. Goodwin 29th July 2025 Chairman 26 DIRECTORS’ REPORTS CORPORATE GOVERNANCE REPORT Introduction Governance is led by the Group Chair and Board, who are collectively responsible for setting the Company’s strategy to deliver long-term value to shareholders and the wider stakeholders. The Board sets the Group’s culture and values and is responsible for the stewardship of the Company’s business to the shareholders and wider stakeholders. The Board comprises five Executive Directors and now two independent Non-Executive Directors (NEDs) Mrs. J. E. Kelly and Ms C. A. McNamara, who was appointed to the Board as a Non-Executive Director on the 2nd October 2024 and comes with an extensive and varied career within the energy and power sector. As a qualified accountant, she has held multiple FD / CFO roles within large corporates, including Powergen, National Grid plc and BG Group plc (purchased by Shell plc in 2016). In addition to sitting on multiple boards and committees, Ms. C. A. McNamara’s executive career has been hands-on with her having spent over seventeen years overseas growing regional businesses in Asia and the Middle East. Her responsibilities during her twenty-five years’ experience have included financial strategy, business performance, governance, audit and risk management. Following a thorough induction to the business over the four months prior to her appointment, we are confident that Ms. C. A. McNamara’s extensive listed company experience and exposure to a variety of business aspects will be of significant benefit to the Company. The Audit Committee up until 30th April 2025 consisted of Mrs. J. E. Kelly, one of the Non-Executive Director’s who is the Audit Committee Chair, and three other members, the previous Chairman, the previous Managing Director and the previous Company Secretary, all of whom had held their previous positions for twenty-seven years and possess substantial knowledge and experience of the diversified Group’s people, product ranges and the very diversified overseas customers and markets in which the Group operates. Effective as of the 30th April 2025, changes have been made to the composition of the Audit Committee so that the majority of its members are independent, which will allow the Group to comply with the Listing Rules as interpreted and mandated by the Financial Conduct Authority (FCA). Mrs. J. E. Kelly continues as Chair of the Audit Committee and has been joined by the Chairman and Executive Director, Mr. T. J. W. Goodwin, and Non-Executive Director, Ms. C. A. McNamara. Mr. J. W. Goodwin, Mr. R. S. Goodwin and Mrs. P. Ashley have stepped down from the Committee. The Board and the Audit Committee fulfil the roles required for effective corporate governance and the Board considers that it has the right governance in place to execute its strategy to achieve its objectives. The Board has always felt that it should be recognised that what may be appropriate for the larger company may not necessarily be so for the smaller company, a point raised previously in the Cadbury Code of Best Practice. Whilst conscious of its non-compliance with certain aspects of the Code as detailed below, we do not believe that at this stage in the Group’s development and circumstances it is appropriate to change its own operational or governance structure with the sole objective of achieving compliance with the revised Code given that the Board’s current corporate governance strategy has been accepted by a large majority of its shareholders. The Group’s governance structure, as set out below, is a structured system of rules and practices that shapes how the Company operates, whilst also remaining dynamic, in addition to providing the Board the necessary oversight to review its progress against its strategic plan. Compliance statement under the UK Corporate Governance Code 2024 The Company is required to report on compliance throughout the year. In relation to all of the Provisions except those mentioned below, the Company complied throughout the year. As noted in the introduction above, the Group does not comply with aspects of the Code’s requirements under Provisions 11 and 12 and Provision 13 in terms of having a Senior Independent Director as the majority of the Board are Executive Directors and the composition of the Board is determined by the Board as a whole. The Group does not have a Remuneration Committee or a Nominations Committee as required under Provisions 17, 23, 32, 33, and 41. Contrary to Provision 36, the Company does not have a formal policy for post-employment shareholding requirements as it does not have any unvested or un-exercised vested share options in existence. Our Remuneration Policy is described on pages 34 and 35, there are no malus or clawback provisions contrary to Provision 38, as any increases or bonuses awarded to Directors’ or the general workforce, are discretionary. The roles of the Chairman in running the Board and the Managing Directors in running the Group’s businesses are well understood. It is not considered necessary to have written job descriptions. This is contrary to Provision 14. In the best interests of the Company it has been concluded that an independent Chairman is not necessary when considered with the Company’s investor profile, thereby the Company does not comply with Provision 9 of the Code. The Chairman and Managing Directors do not retire by rotation, therefore maintaining continuity of expertise which is contrary to Provision 18 of the Code and as required by Provision 7, the Board has a conflicts of interest policy which includes a procedure for disclosure and review of any potential conflicts and, if appropriate, approval by the Board. The shareholding of the Executive Directors is not considered a conflict in interests due to their contribution to the long-term sustainable success of the Group being aligned with its other shareholders. For reasons as set out on the following pages within the Corporate Governance Report the Company is not compliant with Provisions, 22 and 29. The code is available to view on the website of the Financial Reporting Council at www.frc.org.uk 27 DIRECTORS’ REPORTS CORPORATE GOVERNANCE REPORT (continued) The Board During the year, the Board met formally eleven times, and details of attendees at these meetings are set out below: M. S. Goodwin ... ... ... ... ... 11 out of 11 attended S. R. Goodwin ... ... ... ... ... 11 out of 11 attended T. J. W. Goodwin ... ... ... ... ... 11 out of 11 attended B. R. E. Goodwin ... ... ... ... ... 11 out of 11 attended N. Brown ... ... ... ... ... ... 11 out of 11 attended J. E. Kelly ... ... ... ... ... ... 11 out of 11 attended C. A. McNamara ... ... ... ... ... 8 out of 8 attended (appointed 2nd October, 2024) The Chairman and Managing Directors do not retire by rotation. With this exception, all Directors retire at the first Annual General Meeting after their initial appointment and then by rotation at least every three years, which is contrary to Provision 18 of the Code. The Board retains full responsibility for the direction and control of the Group and continually monitors and assesses the culture to ensure that it is aligned with the Group’s purpose, values and strategy. With the culture of the Group being well established there have not been any specific actions taken in the year other than continuing to lead by example and encouraging open communication, transparency and respect. Whilst there is no formal schedule of matters reserved for the Board, all acquisitions and disposals of assets, investments and material capital-related projects are, as a matter of course, specifically reserved for Board decision, but referred to the Audit Committee for comment. The Board meets regularly to discuss corporate strategy; to formulate and monitor the progress of business plans for all subsidiaries and to identify, evaluate and manage the business risks faced. The management philosophy of the Group is to operate its subsidiaries on an autonomous basis, subject to overall supervision and evaluation by the Board, with formally defined areas of responsibility and delegation of authority. The Group has formal lines of reporting in place with subsidiary management meeting with the Board on a regular basis. Regular informal meetings are also held to enable all members of the Board to discuss relevant issues with local management and staff at the business units. This is in addition to the flat structure in place and the hands-on approach of the Directors, which is how the Board continually assesses emerging risks. Following the identification of an emerging risk the Board dynamically sets out a plan and typically appoints an individual with the necessary skill set, whether they be internal or external, to either manage or mitigate the risk. The Audit Committee The Audit Committee during the year was made up of the following: Mrs. J. E. Kelly (Chair), Mr. J. W. Goodwin, Mr. R. S. Goodwin and Mrs. P. Ashley and the Audit Committee reports to the Board. The Audit Committee has met formally eight times since the issue of the Annual Report for the year ended 30th April, 2024, with all members attending each meeting. The responsibility of the Audit Committee is explained in the Audit Committee Report on pages 31 to 33. The Audit Committee takes into account the Company’s corporate Mission Statement, Objectives and Strategy, and reviews investor correspondence and comments, regulatory changes, current issues and market trends. The Audit Committee uses expert opinion where considered appropriate. As noted earlier on, effective as of the 30th April 2025, changes have been made to the composition of the Audit Committee so that the majority of its members are independent, which will allow the Group to comply with the Listing Rules as interpreted and mandated by the Financial Conduct Authority (FCA). Mrs. J. E. Kelly continues as Chair of the Audit Committee and has been joined by the Chairman and Executive Director, Mr. T. J. W. Goodwin, contrary to Provision 24 and Non-Executive Director, Ms. C.A. McNamara. Board Performance Review The Divisional Managing Directors and Chairman address the development, composition, diversity and training needs of the Board as a whole. A review of the effectiveness and performance of the Board and the Directors of subsidiaries has been carried out by the Managing Directors and Chairman by way of personal discussions and individual performance evaluation. As the Managing Directors and the Chairman are executive Directors, which in addition to there not being defined performance obligations that individuals are assessed against, the Group does not comply with Provision 13 of the UK Corporate Governance Code. Furthermore, as the Chair does not individually assess and or act on the results of the evaluation, the Group does not comply with Provision 22. The Board recognises the importance of its composition and diversity and remains committed to suitable corporate governance and believes that a wide range of knowledge, skills and experience are among the essential drivers to long-term success. We continue to evaluate the composition of the Board and recognise the value that non-executives typically offer, by ensuring that the Board is acting in the best interests of the Company. The Board considers the value offered in this circumstance is significantly less as the Executive Directors, who form part of the controlling concert party, are, in essence, custodians of the business, resulting in their interests being the long-term growth and success of the business. Furthermore, the Board would lose its dynamic management of the business that over the history of the Group has enabled it to vastly outperform the FTSE 100 and FTSE 250, see page 36 for details. Additionally, when consideration is also given to the recommended tenure of NEDs, the benefit of NEDs is initially limited by the fact that it takes a significant amount of time to understand the vastly diverse and extremely technical products that the Group supplies. Whilst Mrs J. E. Kelly has held the role since 2015, the 28 DIRECTORS’ REPORTS CORPORATE GOVERNANCE REPORT (continued) Board Performance Review (continued) Board does not consider her independence to be impaired as she has never been an employee of the Company, does not have and has not had any material links or relationships with the Company, does not own or represent any shareholding in the Company. Independent oversight and robust challenge continue to be preserved, with the recent appointment of an additional Non-Executive Director further strengthening the Board’s governance structure. The structure of the Board and its Audit Committee brings balance, astute guidance and deep understanding of the business at both operational and Board level. All Directors have reasonable access to the Company Secretary and to independent professional advice at the Company’s expense. External audit The external auditor is appointed annually at the Annual General Meeting. The Board, following review and recommendations received from the Audit Committee, considers the appointment of the auditor, and assesses on an annual basis the qualification, expertise, cost and objectivity of the external auditor. The auditor’s independence is safeguarded by the Group following its policy and procedure on non-audit services. The policy recognises that certain material or highly sensitive non-audit services may not be carried out by the external auditor, such as valuations or advisory services. In addition to the auditor having their own policies and checks, the Audit Committee monitors the level of non-audit services provided to the Group by the external auditor to ensure that their independence is not compromised. The effectiveness of the external audit is assessed annually, following completion of the audit. Following discussions with all parties involved in the audit on an operational level, the Board discusses on the efficiency and performance of the overall audit. This is then discussed with the Audit Committee, which evaluates the effectiveness of the audit process. Any suggested improvements in audit processes from the prior year are reported back to the Board and the audit partner so that they can be taken into account when planning the audit for the following year. Disclosure of information to auditor The Directors who held office at the date of approval of this Corporate Governance Report confirm that, so far as they are each aware, there is no relevant audit information of which the Company’s auditor is unaware; and each Director has taken all the steps that he or she ought to have taken as a Director to make himself or herself aware of any relevant audit information and to establish that the Company’s auditor is aware of that information. Internal control and risk management The Board has overall responsibility for the Group’s systems of internal controls and risk management which are designed to manage rather than eliminate risk and provide reasonable reassurance against material misstatement or loss. The Board has overall responsibility for the Group’s systems of internal controls and risk management which are designed to manage rather than eliminate risk and provide reasonable reassurance against material misstatement or loss. The Board has primary responsibility for controlling: operational risks; financial risks including funding and capital spend; compliance risks; and political risks. The Audit Committee has been delegated responsibility for reviewing corporate reporting, financial risk management and to regularly review the effectiveness of the Group’s internal controls together with consideration of any reports from the external auditor. The Audit Committee Report is on pages 31 to 33. Except as noted within this Corporate Governance Report, the Board confirms that the internal control systems comply with the UK Corporate Governance Code. The Group’s main systems of internal controls include all the key aspects of a robust internal control framework, which includes reviews, reconciliations and segregations of duties, risk assessment as articulated and detailed in this report, together with focused financial and business information and effective communication. This encompasses regular visits and discussions between Board Directors and subsidiary management, in-house General Counsel, Health and Safety Committee and the Group Internal Auditor, on all aspects of the business and monitoring, which incorporates financial reporting, risk reporting and compliance reporting. This is performed through monthly, detailed management reporting and periodic in-depth reviews by business managers. In addition, there is Board representation with Goodwin PLC Directors on the boards of the subsidiaries. Any concerns are reported to the members of the Audit Committee and to the Board. The Group has regular reviews of its risk register, business continuity programmes and its insurance programmes. These procedures endeavour to ensure compliance with the FRC publication ‘Risk Management, Internal Control and Related Financial and Business Reporting’. The Board considers that the close involvement of its management and Board Directors in all areas and through effective delegation of authorities a key pillar of its effective control over its financial and business risks system, by providing an ongoing process for identifying, evaluating and managing the principal risks faced by the Group. In particular, authority is limited to Board Directors in key risk areas such as treasury management, capital expenditure and other investment decisions. The internal controls in relation to financial reporting include separation of functions, planning and performance reporting. Financial targets are set annually and are monitored on a monthly basis at an individual and at a consolidated level through the use of reports that typically include income statement and balance sheet data, in addition to key indicators relevant to each business or division. 29 DIRECTORS’ REPORTS CORPORATE GOVERNANCE REPORT (continued) Internal control and risk management (continued) The close involvement of the Board in the day-to-day operations through its business managers ensures that the Board has the financial and non-financial controls under constant review and so it is not currently considered that formal Board reviews of these controls would provide any additional benefit in terms of the effectiveness of the Group’s internal control systems. This is contrary to Provision 29 of the UK Corporate Governance Code. The Board recognises the importance of an effective internal audit function to assist with the management and review of internal controls and business risk. The Group’s internal auditor continues to make good progress reviewing internal controls, procedures and accounting systems, and, despite video conferencing improving the level of coverage, it is a fact of life that the best results of internal audit are achieved by site visits. The Board of Directors and Senior Management will continue to have close involvement on a day-to-day operational basis and the scope and results of internal audit work to be performed will be kept under review in the coming year. The Board considers that certain functions are best carried out by independent external bodies with specific expertise, who then report to the Board directly or through the Audit Committee. The Board confirms that it has not been advised of any material failures or weaknesses in the Group’s internal control systems. Approved by the Board of Directors and signed on its behalf by: T. J. W. Goodwin 29th July 2025 Chairman 30 DIRECTORS’ REPORTS AUDIT COMMITTEE REPORT The key role of the Audit Committee is to provide confidence in the integrity of the Group’s financial risk management, Internal financial controls and corporate reporting. The Audit Committee, as empowered by the Group’s Board of Directors, has responsibility for: 1. Reviewing and checking the Group’s full year and half year Accounts and the Annual Report, as presented to the Audit Committee and monitoring the integrity of the financial statements. 2. Reviewing the Group’s financial controls and risk management systems and commenting on whether they are relevant and effective. 3. Making recommendations to the Group’s Board of Directors on the appointment and remuneration of the Group’s external auditor; ensuring independence and objectivity of the auditor; the effectiveness of the audit process; that the Group receives value for money from the audit and that no non-audit services are carried out by the auditor. 4. Reviewing the scope of work for the internal audit function and the resultant reports. 5. Reviewing significant accounting estimates and judgements relating to the financial statements with the external auditor and members of the Board, and providing advice on whether the Annual Report and accounts as a whole are fair, balanced and understandable in providing the information necessary for shareholders to assess the Company’s position and performance, business model and strategy. The Audit Committee reports to the Board on how it has discharged its responsibilities. The Audit Committee discharges each of its above responsibilities as follows: 1. Examining the integrity of the Group’s Annual Report and half year Interim Report: The Chair of the Audit Committee is an independent Non-Executive Director. The other members of the committee have a combined in-depth level of expertise in the Group’s typical products and or markets or have vast historical knowledge of the business and activities of the Group. This, together with their regular involvement in reviewing the Group’s financial performance and accounts, provides the necessary level of financial review. Regular meetings are held between members of the Audit Committee, Directors of Goodwin PLC and its subsidiaries, General Managers and Senior Management of the UK subsidiaries. Members of the Audit Committee are involved in regular discussions with the Directors, General Managers and Senior Management of each subsidiary where the positions taken on subjective financial matters are discussed. Any areas where the Audit Committee feels that the positions taken within any particular subsidiary are either inappropriate or merit further review are discussed with the Board of Directors of Goodwin PLC. For the half year Interim Report, the Audit Committee reviews the financial and non-financial content, including the Chairman’s Statement, and reviews the financial statements and qualitative notes of the financial statements, to help ensure that they are balanced, relevant, appropriately compliant with relevant accounting standards/ legislation, and are consistent and complete. The Audit Committee discusses with the Board of Directors their views as to whether the half year Interim Report, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group’s half year performance. The figures in the half year Interim Report are not audited, but the external auditor is given sight of these before publication. For the full year Annual Report, the Audit Committee reviews the financial content of the Group Strategic Report, including the Chairman’s Statement; the Corporate Governance Report and reviews the financial statements and the qualitative notes to the financial statements to examine whether the content is fair, balanced, relevant, understandable, appropriately compliant with relevant accounting standards / legislation and consistent and complete. The Audit Committee has discussed the full year Annual Report and their views with the Group external auditor. The Audit Committee confirmed to the Board that in its opinion the proposed Annual Report for the year ended 30th April, 2025 appropriately represents the Group’s trading position and, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group’s full year performance, its position at the year end, and its objectives, strategy and business model. 2. Helping to ensure the Group carries effective and relevant financial and non-financial internal controls and financial risk management systems: To assess the effectiveness of systems for internal financial controls, financial reporting and financial risk management, the Audit Committee reviews reports from Main Board Directors on the Group’s subsidiaries; reviews reports from the Group Chief Accountant; reviews reports from General Managers of the Group’s subsidiaries; reviews quarterly financial reports; reviews reports from internal and external audit; requests and reviews reports from independent external consultants; and reviews the Group’s risk register, business continuity programmes and levels of insurance, legal and health and safety reports. 2025 Audit Committee Risk Programme The terms of reference for the Audit Committee and how it discharges its duties have been presented to the Board and ratified. 31 DIRECTORS’ REPORTS AUDIT COMMITTEE REPORT (continued) 2. Helping to ensure the Group carries effective and relevant financial and non-financial internal controls and financial risk management systems: (continued) Risk Management The risk management framework provides a systematic process for the identification, assessment, review and management of risk. This framework provides a bottom-up approach with a top-down review by Directors and General Managers, and, when appropriate, the Audit Committee reviews the status. Financial risk This has been reviewed and is as stated in previous years with the perceived increased volatility in exchange rates and the possibility of high foreign exchange hedging costs for forward long-term contracts. Regulatory compliance The Audit Committee continues to monitor regulatory compliance, training and competency. Whistle-blowing Procedures The Group has a whistle-blowing policy in place whereby employees can report any suspected misconduct or concerns, either anonymously on a dedicated telephone line, or to the Chairman, the Company Secretary or the Chair of the Audit Committee. Such calls are investigated and are reported to the Audit Committee. The Audit Committee has confirmed to the Board that the Group’s whistle-blowing policy and procedures are appropriate. The Audit Committee has confirmed its view to the Board that in its opinion, the Group carries relevant internal controls and risk management systems appropriate to minimise the perceived risks of the Group’s business. 3. The Group’s external auditor RSM UK Audit LLP (“RSM”) was first appointed as the Group’s Auditor at the Company’s AGM in October 2020. However, with the audit fee increasing very substantially since we appointed RSM, the audit was put out for tender in 2024 with the aspiration of obtaining more reasonable audit fees. As there are a limited number of audit companies that are suitable for auditing PLCs we, unfortunately, obtained little or no reduction (when taking into account the cost of changing and initiating a new Auditor) in what we were being quoted by RSM. Accordingly, on the basis of next year’s fees increasing in line with the market, shareholders are being asked to vote on the re- appointment of RSM at the AGM on the 1st October 2025. In line with regulation, the audit will be put out to tender at least every ten years. Subject to not bringing the tender forward, the Group will be required to re-tender the audit in financial year 2034. In addition to the auditor having their own policies and checks, to preserve objectivity and independence, the Audit Committee has a policy that restricts the external auditor from carrying out any non-audit services during the year. Throughout the year, the Audit Committee monitors the level of non-audit services provided by RSM to the Group and it became aware that, during the year, RSM South Africa was in the process of performing non-audit work, in assisting with the preparation of the local statutory accounts. This was highlighted to the Audit Committee and the engagement that had a value of £1,050 per annum ceased immediately. The Company has, for many years now, used a different accountancy practice to that of the statutory auditor for its UK tax services. To further assess both objectivity and independence, the Audit Committee also takes into consideration any relationships between the Group and the audit firm, the audit fee as a proportion of the overall fee income of the audit firm and whether the Group has employed any former members of the external audit team. The Audit Committee has met formally with the Group’s external auditor, RSM, to discuss the full year Annual Report, and has met with and discussed matters with them as part of the audit process during the current financial year being reported on. No material concerns were raised during these meetings or discussions. The Audit Committee appraises the auditor’s effectiveness on an annual basis, through regular engagement with RSM during the audit process, in addition to taking into account: • feedback from Directors, senior managers and the Group Chief Accountant; • the quality and scope of all key external auditor plans and reports; • the delivery and performance against this plan; • the behaviour, qualifications and performance of their audit team; • RSM’s understanding of the Group’s business and industry sector. The Audit Committee was satisfied with the external auditor’s independence of the audit process. The Audit Committee has recommended to the Board to propose a Resolution to confirm the re-appointment of RSM UK Audit LLP, as the external auditor, at the Annual General Meeting on 1st October, 2025. 32 DIRECTORS’ REPORTS AUDIT COMMITTEE REPORT (continued) 4. Internal Audit The scope of internal audit has been set by the Audit Committee and the results reviewed. The internal audit function operates a random rotation policy which prioritises based on materiality and endeavours to cover all Group subsidiaries at least once within a three-year cycle either via the Group Internal Auditor or by the respective Group Managing Directors. 5. Accounting estimates and judgements relating to the Financial Statements The Audit Committee again reviewed what it considered to be the accounting estimates and judgement areas within the Group Annual Report for the year ended 30th April, 2025 as detailed in note 2 to the Financial Statements and including: • Revenue recognition in relation to contracts recognised over time; • Duvelco viability; The Audit Committee took account of the findings of RSM in relation to their external audit work for the year. As stated on page 27 of the Corporate Governance Report, effective as of the 30th April 2025, changes have been made to the composition of the Audit Committee so that the majority of its members are independent, which will allow the Group to comply with the Listing Rules as interpreted and mandated by the Financial Conduct Authority (FCA). Mrs. J. E. Kelly continues as Chair of the Audit Committee and has been joined by the Chairman and Executive Director, Mr. T. J. W. Goodwin, and Non-Executive Director, Ms. C. A. McNamara. J. E. Kelly 29th July, 2025 Chair of the Audit Committee 33 DIRECTORS’ REPORTS DIRECTORS’ REMUNERATION POLICY AND REPORT This report includes the Group’s Remuneration Policy for Directors and sets out the Annual Directors’ Remuneration Report. Group’s Remuneration Policy for Directors The Group’s policy in respect of Directors’ remuneration is to provide individual packages which are determined having due regard to the Group’s current and projected profitability, the employee’s specific areas of responsibility and performance, their related knowledge and experience in the Group’s specific fields of operation, the external labour market and their personal circumstances whereby a package to remunerate and motivate the individual so as to best serve the Group is set. The policy is designed to be simple and naturally aligned with the performance of the Group and its overall strategic objective of growing the long-term profitability of the Group in a sustainable manner whilst delivering a fair return to its shareholders. Consideration is given to the financial and non-financial performance of the individual and how they have performed on delivering against each of the Group’s strategy points, and the Group’s culture, purpose and values. Individual salaries are also indirectly linked up and down to the time allocated and perceived effort by the Director to the Group’s business. Many Directors, as indeed employees, put in hours of work way beyond what could be requested and such personal devotion to duty by a Director is rewarded without formulae. All Board members have access to independent advice when they considered it appropriate. In forming its policy, consideration has been given to the UK Corporate Governance Code best practice provisions on remuneration policy, service contracts and compensation and has considered the remuneration levels of Directors of comparative companies. The remuneration policy for other employees is broadly based on principles consistent with the policy for Directors. Salary reviews take into account Group performance as well as subsidiary performance, local pay and market conditions. Directors are paid based on their level of activity within the Group, their knowledge and experience of the Group’s activities or similar, the performance of the Group versus market opportunity whilst also considering the Director’s personal circumstances and the salary needed to ensure continuity of employment. This in itself may result in decreases or increases in a Director’s salary within any year as illustrated in the matrix below. Element of Purpose and Operation Maximum Performance Changes for Pay Link to Strategy Targets 2024 / 2025 Salary Reflects the Directors’ Reviewed Generally in line The Group’s Directors set the level of activity and annually at the with inflation and performance, base increase in achievement within the anniversary of the wage / salary good or bad, salaries. For the Group, their knowledge the previous increase awarded may result in period May 2024 and experience of the salary adjustment to employees, but the salary being to April 2025 the Company’s activities for the individual this is not rigid. changed. increase was or similar, the Director. generally 3.43%. performance of the Group versus market opportunity, whilst also considering the salary needed to ensure continuity of employment. Pensions All Executive Directors Monthly Currently N/A No changes. are entitled to have 3% payments 3% of gross added to their gross remuneration remuneration which, by nature of salary sacrifice, is put into a pension scheme where they have direct dealings with the elected investment fund provider. Other Fully expensed car or N/A N/A N/A See details of benefits cash alternative, health the Directors’ insurance or other emoluments on services. page 38. Whilst being aware of the requirements to show in graph form the breakdown of base pay, bonus pay, pension and long-term benefits, the Group is unable to comply with this requirement as Directors are not paid in accordance with any specific performance criteria or KPIs. We believe the above meets the requirement of Schedule 8, Companies Act 2006, regarding the changes in 2024 / 2025. The Policy and Report is signed by the Chairman and the Managing Directors. 34 DIRECTORS’ REPORTS DIRECTORS’ REMUNERATION POLICY AND REPORT (continued) Group’s Remuneration Policy for Directors (continued) In any company there are specific individual circumstances that on occasions will merit special treatment in a given year for a Director either to keep or look after the person, indeed no different than we may do for an employee. However, bearing in mind the performance of the Company over the past twenty years and more and that the Directors’ salaries are anything but excessive versus the norm of other PLCs, this is the Board’s policy. Total shareholder return (TSR) – unaudited As is required by The Listing Rules, we show in graph form both the salary of the Managing Directors (CEO equivalent) of Goodwin PLC and the TSR over the past ten years. We, however, do not list out the salary of the Financial Director of Goodwin PLC versus the TSR as in Goodwin PLC we have a Group Chief Accountant who carries out 75% of the duties of a Financial Director, but we do not have what would generally be known as a Financial Director. This is for the reason that certain decisions that external audience may consider to be the sole responsibility of the Financial Director are not. In Goodwin PLC it is a team effort and such decisions are made not only by the Group Chief Accountant but also by the Managing Directors and the Chairman. Approval of the Company’s Directors’ Remuneration Policy The Company put the Remuneration Policy to the vote at the Annual General Meeting on 5th October, 2022, when it was passed by 99.94% of those who voted. The Company will be putting the Remuneration Policy to the vote again this year in 2025, which is three years from the last vote, as is required by the Listing Rules. For confidentiality and flexibility reasons, the Board policy is not to disclose exit / termination payments to Directors but the policy is to remain within the law, to fairly compensate good leavers and minimise payments to bad leavers. In the last ten years, the Company has managed to avoid paying any termination payments to bad leavers. It is, however, Board policy to limit termination payments to a maximum of 100% of gross annual salary and should such an amount be exceeded, then it will be reported in the Annual Report giving the reason why. The Company takes seriously its responsibility for ensuring a fair deal between employees, shareholders, customers and the local community and maintaining an appropriate balance. The Company does not use or pay any external advisers or consultants for remuneration or incentive policy. Shareholder engagement is by nature of the Annual Report, the Annual General Meeting and the votes therein. 35 DIRECTORS’ REPORTS DIRECTORS’ REMUNERATION POLICY AND REPORT (continued) Annual Directors’ Remuneration Report This report is submitted in accordance with the Directors’ Remuneration Report Regulations. Consideration by the Directors of matters relating to Directors’ remuneration The Company’s Remuneration Policy for Directors, including remuneration of its Non-Executives, is set by the Board as a whole and is described in pages 34 to 35 therein. The Policy has been followed in the financial year to 30th April, 2025 and will be followed in the next financial year. The Board of Directors are also the key management personnel as defined in IAS 24. Service contracts None of the Directors has a service contract. A Director may resign at any time by notice in writing to the Board. There are no set minimum notice periods but all Directors other than the Chairman and Managing Directors are subject to retirement by rotation and as employees also have notice periods in accordance with law. No compensation as of right is payable to Directors on leaving office. Relative importance of spend on pay The table below shows shareholder distributions and total employee expenditure, and the percentage change in both: 2025 2024 £’000 £’000 % Ordinary dividends proposed in respect of the year (£’000) ... ... ... ... 21,027 9,988 110.5 Total employee costs (£’000) ... ... ... ... ... ... ... ... ... 62,307 59,396 4.9 Average employee numbers ... ... ... ... ... ... ... ... ... 1,253 1,225 2.3 Total employee costs, excluding the Managing Directors’ salaries, have increased by 4.9%. The majority of this increase relates primarily to the increased activity levels and overtime paid within the individual factories. Approval of the Company’s Annual Directors’ Remuneration Report An ordinary resolution for the approval of the Annual Directors’ Remuneration Report will be put to shareholders at the forthcoming Annual General Meeting. The Annual Directors’ Remuneration Report presented in the accounts to 30th April, 2024 was put to the shareholders at last year’s Annual General Meeting on 2nd October, 2024. The Annual Directors’ Remuneration Report was accepted with 98.51% of proxy votes cast in favour. Total shareholder return (TSR) – unaudited The following graphs compare the Group’s total shareholder return over the ten and twenty years ended 30th April, 2025 with various FTSE indices. The graphs also show the change in the earnings of the previous Managing Director for the periods up to 30th April, 2019. From 30th April 2019, the base earnings figure in the graphs is the amount earned by each Managing Director. Element of Pay 2021 2022 2023 2024 2025 £’000 £’000 £’000 £’000 £’000 Managing Directors’ 355 374 406 435 451 base earnings For reference the TSR of Goodwin PLC versus the FTSE 100 and the FTSE 350 is shown below for not only the last five but also the last ten years and the last twenty years. Goodwin FTSE 100 FTSE 350 TSR for last 5 years ... ... ... 243% 73% 34% TSR for last 10 years ... ... ... 255% 79% 86% TSR for last 20 years ... ... ... 3,104% 274% 259% The following graphs have not been audited. 36 DIRECTORS’ REPORTS DIRECTORS’ REMUNERATION POLICY AND REPORT (continued) Annual Directors’ Remuneration Report Total Shareholder Return (TSR) 20 Years ended 30th April 2025 3,500 3,000 2,500 % C h a n ge 2,000 Cumulative 1,500 1,000 (continued) The increase in the Goodwin PLC share price since 2005 plus dividends re-invested would mean that £1.00 invested in 2005 by 30th April, 2025 would be worth £32.04. Goodwin FTSE 100 500 FTSE 350 Small Cap 0 Ind & Eng -500 MD Earnings 2019 April 2005 April 2007 April 2009 April 2011 April 2013 April 2015 April 2017 April April 2021 April 2023 April 2025 Total Shareholder Return (TSR) 10 Years ended 30th April 2025 The increase in the share price since 2015 plus dividends re- invested would mean that £1.00 invested in 2015 would at 30th April, 2025 be worth £3.55. 300 250 200 Change 150 % Cumul ative 100 Goodwin FTSE 100 50 FTSE 350 0 Small Cap Ind & Eng -50 MD Earnings April 2015 April 2016 April 2017 April 2018 April 2019 April 2020 April 2021 April 2022 April 2023 April 2024 April 2025 37 DIRECTORS’ REPORTS DIRECTORS’ REMUNERATION POLICY AND REPORT (continued) Annual Directors’ Remuneration Report (continued) The auditor is required to report on the following information contained in this section of the Annual Directors’ Remuneration Report. Directors’ interests in the share capital of the Company as well as ex Directors – audited The interests of the Directors in the share capital of the Company at the beginning and end of the financial year were as follows: Number of 10p ordinary shares 30th April 30th April Beneficial 2025 2024 54,535 M. S. Goodwin ... ... ... ... ... ... 54,535 S. R. Goodwin ... ... ... ... ... ... 59,633 57,344 T. J. W. Goodwin ... ... ... ... ... ... 102,686 98,589 B. R. E. Goodwin ... ... ... ... ... ... 35,815 33,428 N. Brown ... ... ... ... ... ... 445 445 J. W. Goodwin ... ... ... ... ... ... 43,703 39,167 R. S. Goodwin ... ... ... ... ... ... 14,716 14,716 M. S. Goodwin, S. R. Goodwin, T. J. W. Goodwin 3,755,161 and B. R. E. Goodwin ... ... ... ... ... 3,755,161 Non-Beneficial 14,166 J. W. Goodwin and E. M. Goodwin 14,166 * J. W. Goodwin and R. S. Goodwin are ex-Directors of the Company and Audit Committee members until 30th April, 2025. ** Held via J. M. Securities (No 3) Limited. Details of individual emoluments and compensation – audited Year ended 30th April, 2025 Single Total Figure Table Salary Benefits Pension Non-Exec Total in kind contribu- Director’s tions fees £’000 £’000 £’000 M. S. Goodwin ... ... ... ... ... ... ... 446 5 - - 451 S. R. Goodwin ... ... ... ... ... ... ... 446 5 - - 451 T. J. W. Goodwin ... ... ... ... ... ... ... 320 5 - - 325 B. R. E. Goodwin ... ... ... ... ... ... ... 401 5 - - 406 N. Brown ... ... ... ... ... ... ... ... 203 14 6 - 223 J. E. Kelly ... ... ... ... ... ... ... ... - - - 86 86 C. A. McNamara (appointed 2nd October, 2024) ... - - - 32 32 Total ... ... ... ... ... ... ... ... 1,816 34 6 118 1,974 Year ended 30th April, 2024 Single Total Figure Table Salary Benefits Pension Non-Exec Total in kind contribu- Director’s tions fees £’000 £’000 £’000 M. S. Goodwin ... ... ... ... ... ... ... 430 5 - - 435 S. R. Goodwin ... ... ... ... ... ... ... 430 5 - - 435 T. J. W. Goodwin ... ... ... ... ... ... ... 301 5 8 - 314 B. R. E. Goodwin ... ... ... ... ... ... ... 308 5 8 - 321 N. Brown ... ... ... ... ... ... ... ... 198 12 6 - 216 J. E. Kelly ... ... ... ... ... ... ... ... - - - 83 83 Total ... ... ... ... ... ... ... ... 1,667 32 22 83 1,804 Benefits in kind consist of the provision of a fully expensed car, a cash alternative scheme, healthcare insurance or other services. The employer’s national insurance costs relating to the Directors’ remuneration amounted to £264,000 (2024: £227,000). 38 DIRECTORS’ REPORTS DIRECTORS’ REMUNERATION POLICY AND REPORT (continued) Pay Ratio of Managing Directors In accordance with the Pay Ratio Regulations we are disclosing the comparison of our Managing Directors’ pay with that of our average UK employees. It is appropriate that the Managing Directors’ pay was used in the comparison as we do not have what is generally known as a Chief Executive Officer. For the year ended 30th April, 2025 the pay for both the Managing Directors in the Single Total Pay Figure table is the same. If the figures are different in any subsequent year, the higher of the two figures will be used in the pay ratio comparison section. The tables below show our Managing Directors’ pay ratio at the 25th, median and 75th percentile of our UK employees as at 30th April, 2025: Financial Year Method 25th Median 75th percentile pay ratio percentile pay ratio pay ratio 2024 FTSE 350 71:1 52:1 - 2025 ratios Option A 13:1 10:1 6:1 2024 ratios Option A 14:1 10:1 7:1 2023 ratios Option A 14:1 11:1 8:1 2022 ratios Option A 14:1 11:1 8:1 2021 ratios Option A 14:1 11:1 8:1 2020 ratios Option A 12:1 10:1 7:1 Financial Year Managing 25th Median 75th Directors percentile pay percentile £’000 pay £’000 £’000 pay £’000 2025 Total Pay 451 34 46 63 2024 Total Pay 435 32 42 59 2023 Total Pay 406 29 38 52 2022 Total Pay 374 27 34 48 2021 Total Pay 355 26 33 45 2020 Total Pay 333 26 33 45 The 2025 pay ratio for the Managing Directors remains similar to the previous five years and significantly below the average pay ratio for other companies in the FTSE 350. Furthermore, there are currently no intentions to align the pay ratio of the Group’s Managing Directors with the FTSE 350 average. Notes: 1. Total pay has been calculated for each employee and, where applicable, prorated to calculate full-time equivalent pay. It includes payments that are taxable plus any employer pension contributions. 2. We offer competitive and fair rates of pay for all our UK employees taking into account personal circumstances. 3. We have opted for Option A of the pay ratio regulations as this is the preferred option under the regulations and also provides the most accurate data. 4. The above figures are based on the total pay as at 30th April, 2025. Total pension entitlements – unaudited In line with the Government’s requirements the Group administers a pension scheme for all UK employees including Executive Directors. Under this Auto Enrolment Pension arrangement each Executive Director is entitled to have an amount of 3% of gross remuneration paid into a pension scheme where they have direct dealings with the selected investment fund provider. The employee also contributes a minimum of 4% of remuneration to their fund. The pension contributions are to defined contribution pension schemes which are independent of the Company. The Company has no obligations to make any payments in relation to pensions when a Director leaves service by nature of removal from office, resignation or retirement. The Annual Directors’ Remuneration Report was approved by the Board on 29th July, 2025 and is signed on its behalf by: T. J. W. Goodwin M. S. Goodwin S. R. Goodwin Director Director 39 Director INDEPENDENT AUDITOR’S REPORT STATEMENT OF DIRECTORS’ RESPONSIBILITIES IN RESPECT OF THE ANNUAL REPORT AND THE FINANCIAL STATEMENTS The Directors are responsible for preparing the Strategic Report and the Report of the Directors’, the Directors’ Remuneration Report, the separate Corporate Governance Statement and the financial statements in accordance with applicable law and regulations. Company law requires the Directors to prepare Group and Company financial statements for each financial year. The Directors have elected under company law and are required under the Listing Rules of the Financial Conduct Authority to prepare Group financial statements in accordance with UK-adopted International Accounting Standards. The Directors have elected under company law to prepare the Company financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). The Group financial statements are required by law and UK-adopted International Accounting Standards to present fairly the financial position and performance of the Group; the Companies Act 2006 provides in relation to such financial statements that references in the relevant part of that Act to financial statements giving a true and fair view are references to their achieving a fair presentation. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Company and of the profit or loss of the Group for that period. In preparing each of the Group and Company financial statements, the Directors are required to: a. select suitable accounting policies and then apply them consistently; b. make judgements and estimates that are reasonable and prudent; c. for the Group financial statements, state whether they have been prepared in accordance with UK-adopted International Accounting Standards; d. for the Company financial statements, state whether they have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and e. prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and the Company will continue in business. The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group and the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and the Company and enable them to ensure that the financial statements and the Directors’ Remuneration Report comply with the Companies Act 2006. They are responsible for safeguarding the assets of the Group and the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. Directors’ statement pursuant to the Disclosure and Transparency Rules Each of the Directors, whose names are listed on page 24, confirm that to the best of each person’s knowledge: a. the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit of the Company and the undertakings included in the consolidation taken as a whole; and b. the Strategic Report contained in the Annual Report includes a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face. The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Goodwin PLC website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. T. J. W. Goodwin M. S. Goodwin S. R. Goodwin Director Director Director 29th July, 2025 40 INDEPENDENT AUDITOR’S REPORT INDEPENDENT AUDITOR’S REPORT to the members of Goodwin PLC Opinion We have audited the financial statements of Goodwin PLC (the ‘parent Company’) and its subsidiaries (the ‘Group’) for the year ended 30 April 2025 which comprise the Consolidated Statement of Profit and Loss, Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Consolidated Statement of Changes in Equity, Consolidated Statement of Cash Flows, Company Balance Sheet, Company Statement of Changes in Equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in the preparation of the Group financial statements is applicable law and UK-adopted International Accounting Standards. The financial reporting framework that has been applied in the preparation of the parent Company financial statements is applicable law and United Kingdom Accounting Standards including Financial Reporting Standard 101 “Reduced Disclosure Framework” (United Kingdom Generally Accepted Accounting Practice). In our opinion: • the financial statements give a true and fair view of the state of the Group’s and of the parent Company’s affairs as at 30 April 2025 and of the Group’s profit for the year then ended; • the Group financial statements have been properly prepared in accordance with UK-adopted International Accounting Standards; • the parent Company financial statements have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and • the financial statements 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 Group and parent 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 public interest 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. Summary of our audit approach Key audit matters Group • Revenue recognition – revenue recognised over time • Carrying value of the Duvelco cash generating unit (CGU) Parent Company • No key audit matters noted Materiality Group • Overall materiality: £1,430,000 (2024: £1,050,000) • Performance materiality: £1,070,500 (2024: 787,500) Parent Company • Overall materiality: £3,020,000 (2024: £3,130,000) • Performance materiality: £2,265,000 (2024: £2,347,500) Scope Our audit procedures covered 85% of revenue, 92% of net assets and 88% of profit before tax. Key audit matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the Group and parent Company financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on the overall audit strategy, the allocation of resources in the audit and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the Group and parent Company financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. 41 INDEPENDENT AUDITOR’S REPORT Revenue recognition – Revenue recognised over time Key audit matter description Refer to accounting policies in note 1, accounting estimates and judgements in note 2 and note 4. Revenue underpins the key measures of performance of the Group. As a profit-oriented business, we considered the risk of fraud in the recognition of revenue. We identified that there was a heightened risk of misstatement around the year end through inappropriate application of the Group’s revenue recognition policies and revenue transactions being recognised in the wrong period. The Group has contracts with customers under which revenue is recognised over time. Revenue recognised in the year on these contracts amounted to £106,610,436. Estimates are made by management based on work completed for each contract and costs to complete. Revenue is recognised with an associated adjustment made to cost of sales to adjust the level of profits recognised on the contract to be in line with the percentage stage of completion. Associated contract assets, liabilities and work in progress are recognised where applicable on these contracts. There is a risk that revenue could be misstated through: • inappropriate application of the Group’s revenue recognition policies; • the high level of estimation uncertainty in recognising revenue on over time contracts which remain open at year end; or • modifications in contractual arrangements, such as variations and settlements of claims. This has been determined to be a key audit matter due to the significant level of judgement involved and the audit resourced utilised in addressing this risk. How the matter was addressed in the audit We assessed whether revenue was recognised in line with the Group’s revenue recognition policies and IFRS 15 ‘Revenue from contracts with customers’. We undertook tests of details on contracts that have been completed in the year and those open at the year end. We considered management’s estimates of the stage of completion for open contracts at the period end, substantively testing supporting schedules, including verification of contractual terms. We challenged operational management and project engineers via discussions on the key assumptions, variances identified and reviewed historical budgeting accuracy. For all contracts selected we tested the associated contract assets and contract liabilities. We checked the associated adjustments to revenue were appropriate for the period through our contract testing procedures. We reviewed the disclosures associated with revenue recognition. Key observations In concluding our audit, we identified misstatements in excess of the trivial threshold relating to revenue contracts. Where misstatements were identified, we reported these to those charged with governance. The unadjusted misstatements relating to revenue contracts were below overall materiality. These adjustments, if corrected, would serve to increase reported profit for the period. 42 INDEPENDENT AUDITOR’S REPORT Carrying value of the Duvelco cash generating unit (CGU) Key audit matter description Refer to accounting policies in note 1, accounting estimates and judgements in note 2 and note 15. The Group has various intangible assets including goodwill, brand names, intellectual property, manufacturing rights, software and licences and development costs. These assets form part of the Group’s cash generating units (CGUs). The Group has incurred significant expenditure on development and capital expenditure within the Duvelco business which forms one of the Group’s CGUs. The combined carrying value of intangible development costs and property plant and equipment at 30th April, 2025 for this CGU is £23.3 million. Amounts are capitalised if criteria are met in accordance with IAS 38 ‘Intangible assets’ and IAS 16 ‘Property, plant and equipment’. The viability of and market for new products is not guaranteed. The Group is confident of the success of the product and its impact in the various markets where there are known applications. There remain a number of risks which result in uncertainty, these include: • On commissioning the production facility may not work as expected which results in delays and further costs. There is also a risk that the production facility is not capable of producing the quality of polymer required; • Penetration of the markets expected proves more challenging than expected which results in delays in revenue generation or compromise on margins expected until Duvelco is fully established. Judgement is required in considering these risks and appropriate disclosures should be made in the financial statements. This has been determined to be a key audit matter due to the significant level of judgement involved and the audit resourced utilised in addressing this risk. How the matter was addressed in the audit We assessed the appropriateness of capitalisation of development costs and capital expenditure in Duvelco and the resulting carrying value as a risk due to the impact on reported earnings. We challenged the judgements made in assessing whether the IAS 38 and IAS 16 criteria for capitalisation had been met. In considering the viability of Duvelco, we have understood and assessed the process by which the Group has concluded on: the ability of the production facility to deliver as expected; and reviewed the market analysis and the actions taken to penetrate the key market sectors. We obtained management’s impairment model for the Duvelco CGU and undertook audit procedures included below, we: • Assessed compliance with the requirements of IAS 36 ‘Impairment of assets’; • Analysed the structure and integrity of the model and the mathematical accuracy; • Challenged the main forecasting assumptions used which included expected revenues (amounts and timing), margin and the discount rate; • Performed sensitivity analysis in assessing the risks of impairment; • Corroborated assumptions through discussions with operational and technical management which included visiting the new production facility; • Obtained and reviewed the report undertaken by management’s expert which considered the market opportunity for the product across a number of industries; • Obtained market information and data to consider the potential market sectors applicable to the product; and • Reviewed the disclosures in the financial statements. Key observations Based on our procedures, we concluded that the capitalisation and carrying values in the financial statements were appropriate. The associated disclosures are acceptable. 43 INDEPENDENT AUDITOR’S REPORT Our application of materiality When establishing our overall audit strategy, we set certain thresholds which help us to determine the nature, timing and extent of our audit procedures. When evaluating whether the effects of misstatements, both individually and on the financial statements as a whole, could reasonably influence the economic decisions of the users we take into account the qualitative nature and the size of the misstatements. Based on our professional judgement, we determined materiality as follows: Group Parent Company Overall materiality £1,430,000 (2024: £1,050,000) £3,020,000 (2024: £3,130,000) Basis for determining 4.9% of two year average adjusted 1.6% of total assets overall materiality profit before tax. As a component of the Group audit, which excludes items eliminated on consolidation, the parent company materiality is restricted to £1,100,000 (2024: £690,000) Rationale for benchmark applied Profit before tax is considered the key benchmark of the Group. We have normalised this over a two year period to reflect the fact that some revenue contracts span multiple periods. Total assets is considered the key benchmark of the parent Company as the entity relies on its investments as a non-revenue generating entity Performance materiality £1,070,000 (2024: £787,500) £2,265,000 (2024: £2,347,500) Basis for determining 75% of overall materiality 75% of overall materiality performance materiality Reporting of misstatements to the Audit Committee Misstatements in excess of £71,500 and misstatements below that threshold that, in our view, warranted reporting on qualitative grounds. Misstatements in excess of £55,000 and misstatements below that threshold that, in our view, warranted reporting on qualitative grounds. An overview of the scope of our audit The Group consists of 33 components, located in the following countries: - United Kingdom - China - Germany - South Korea - India - Brazil - South Africa - Australia - Thailand - Finland The coverage achieved by our audit procedures was: Number of Revenue Net assets Absolute Profit components before tax Full scope audit 11 85% 92% 88% Total 11 85% 92% 88% Of the above, full scope audits for four components were undertaken by component auditors. 44 INDEPENDENT AUDITOR’S REPORT The impact of climate change on the audit In planning our audit, we considered the potential impact of the possible risks arising from climate change on the Group’s and the Company’s financial statements and obtained an understanding of how management identifies and responds to climate-related risks. Further information on management’s risk assessment, progress and commitments is provided in the Group’s climate-related risk disclosures on pages 18 to 20 of the Annual Report. We performed risk assessment procedures including making enquiries of management, reading board minutes and applying our knowledge of the Group and the Company and the sector within which it operates, to assess the potential impact on the financial statements. Taking account of the nature of the business, the extent of the headroom in impairment testing, and useful economic lives of tangible / intangible assets to changing regulation, weather patterns or business activities, we have not assessed climate- related risk to be significant to our audit. There was also no impact on our key audit matters. In accordance with our obligations with regards to other information, we have read the Group’s climate-related risk disclosures on pages 18 to 20 of the Annual Report and in doing so have considered whether those disclosures are materially inconsistent with the financial statements or our knowledge obtained during the course of the audit, or otherwise appear to be materially misstated. We have not been engaged to provide assurance over the accuracy of the climate-related risk disclosures set out on pages 18 to 20 in the annual report. Conclusions relating to going concern In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the Directors’ assessment of the Group’s and parent Company’s ability to continue to adopt the going concern basis of accounting included: • Review of management’s approved Board paper which sets out the going concern basis, key forecasting assumptions, sensitivities and conclusion; • Obtained copies of management’s forecasts and sensitivity analysis for the Group and checked the mathematical accuracy of the forecasts; • Understood and reviewed the results of the annual budget review process, including submissions from the UK and overseas businesses which were approved by the Board, comparing the forecasts to historical trading results and the key assumptions for expected growth, margin improvement and capital expenditure plans; • Undertook our own stress test to consider circumstances under which headroom would be eroded; • Verified the committed funding available to the Group and parent Company for the forecast period and the headroom this provided. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group’s or the parent Company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. In relation to the entity reporting on how they have applied the UK Corporate Governance Code, we have nothing material to add or draw attention to in relation to the Directors’ statement in the financial statements about whether the Directors considered it appropriate to adopt the going concern basis of accounting. Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report. 45 INDEPENDENT AUDITOR’S 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, the part of the Directors’ remuneration report to be audited has been properly prepared in accordance with 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 Directors’ Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and • the Strategic Report and the Directors’ Report have been prepared in accordance with applicable legal requirements. Matters on which we are required to report by exception In the light of the knowledge and understanding of the Group and the parent Company and their 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 by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or • the parent Company financial statements and the part of the Directors’ remuneration report to be audited 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. Corporate governance statement We have reviewed the Directors’ statement in relation to going concern, longer-term viability and that part of the Corporate Governance Statement relating to the parent Company’s compliance with the provisions of the UK Corporate Governance Code specified for our review by the Listing Rules. Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the Corporate Governance Statement is materially consistent with the financial statements and our knowledge obtained during the audit: • Directors’ statement with regards the appropriateness of adopting the going concern basis of accounting and any material uncertainties identified set out on pages 25 to 26; • Directors’ explanation as to their assessment of the Group’s prospects, the period this assessment covers and why the period is appropriate set out on page 26; • Director’s statement on whether it has a reasonable expectation that the Group will be able to continue in operation and meets its liabilities set out on page 26; • Directors’ statement on fair, balanced and understandable set out on page 24; • Board’s confirmation that it has carried out a robust assessment of the emerging and principal risks set out on page 14; • Section of the Annual Report that describes the review of effectiveness of risk management and internal control systems set out on page 29; and, • Section describing the work of the Audit Committee set out on page 31. 46 INDEPENDENT AUDITOR’S REPORT Responsibilities of Directors As explained more fully in the Directors’ responsibilities statement set out on page 40, 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 Group’s and the parent 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so. Auditor’s 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. The extent to which the audit was considered capable of detecting irregularities, including fraud Irregularities are instances of non-compliance with laws and regulations. The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements, to perform audit procedures to help identify instances of non-compliance with other laws and regulations that may have a material effect on the financial statements, and to respond appropriately to identified or suspected non-compliance with laws and regulations identified during the audit. In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit. However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity’s operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud. In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the Group audit engagement team and component auditors: • obtained an understanding of the nature of the industry and sector, including the legal and regulatory frameworks that the Group and parent Company operates in and how the Group and parent Company are complying with the legal and regulatory frameworks; • inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud; • discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud, as defined in ISA 250B: having obtained an understanding of the overall control environment. All relevant laws and regulations identified at a Group level and areas susceptible to fraud that could have a material effect on the financial statements were communicated to component auditors. Any instances of non-compliance with laws and regulations identified and communicated by a component auditor were considered in our audit approach. 47 INDEPENDENT AUDITOR’S REPORT Corporate governance statement (continued) The most significant laws and regulations were determined as follows: Legislation / Additional audit procedures performed by the Group audit engagement team Regulation and component auditors included: IFRS/FRS101 and Review of the financial statement disclosures and testing to supporting documentation. Companies Act 2006 / Completion of disclosure checklists to identify areas of non-compliance. Listing Rules Tax compliance Input from a tax specialist was obtained regarding transfer pricing and deferred taxes. regulations Consideration of whether any matter identified during the audit required reporting to an appropriate authority outside the entity. Manufacturing and operational regulations ISAs limit the required audit procedures to identify non-compliance with these laws and regulations to inquiry of management and where appropriate, those charged with governance (as noted above) and inspection of legal and regulatory correspondence, if any. We have completed these procedures which included discussions with the Group’s Legal Counsel. The areas that we identified as being susceptible to material misstatement due to fraud were: Risk Audit procedures performed by the audit engagement team: Revenue recognition – See the key audit matters section of this report for work performed over this risk. We over time sales also performed the following testing: Transactions posted to nominal ledger codes outside of the normal revenue cycle were identified using a data analytic tool and investigated. Revenue recognition – point in time sales Transactions posted to nominal ledger codes outside of the normal revenue cycle were identified using a data analytic tool and investigated. Revenues at the period end were tested to identify revenue recognised in the incorrect period. Management override Testing the appropriateness of journal entries and other adjustments; of controls Assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and Evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business. 48 INDEPENDENT AUDITOR’S REPORT A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report. Other matters which we are required to address Following the recommendation of the Audit Committee, we were appointed by the Board of Directors on 19 March 2021 to audit the financial statements for the year ending 30 April 2021 and subsequent financial periods. The period of total uninterrupted consecutive appointments is five years, covering the years ended 30 April 2021 to 30 April 2025. It was identified during the audit that local accounts preparation services between 30 April 2021 to 30 April 2024 had been provided by a network firm to a subsidiary of Goodwin PLC. These services are prohibited by the FRC’s Revised Ethical Standard 2019 and were terminated as soon as they were identified. We have reassessed our independence and concluded that it was not compromised due to the financial significance of the entity to the Group, the assessed risk of material misstatement and the quantum of the fee that totalled £1,050 per annum. The inadvertent breach was also discussed with the Audit Committee who also concluded that our independence was not compromised. The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the Group or the parent Company, with the exception of the services described above, and we remain independent of the Group and the parent Company in conducting our audit. Our audit opinion is consistent with the additional report to the Audit Committee in accordance with ISAs (UK). 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. As required by the Financial Conduct Authority (FCA) Disclosure Guidance and Transparency Rules, these financial statements form part of the Annual Financial Report prepared in Extensible Hypertext Markup Language (XHTML) format, and filed on the National Storage Mechanism of the UK FCA. This auditor’s report provides no assurance over whether the Annual Financial Report has been prepared in XHTML format. Ian Wall (Senior Statutory Auditor) For and on behalf of RSM UK Audit LLP, Statutory Auditor Chartered Accountants Festival Way, Festival Park, Stoke-on-Trent, ST1 5BB 29th July, 2025 49 FINANCIAL STATEMENTS GOODWIN PLC CONSOLIDATED STATEMENT OF PROFIT OR LOSS for the year ended 30th April, 2025 2025 2024 CONTINUING OPERATIONS Note £’000 £’000 219,709 Revenue ... ... ... ... ... ... ... ... ... ... 3, 4 191,258 Cost of sales ... ... ... ... ... ... ... ... ... ... (128,100) (113,371) GROSS PROFIT ... ... ... ... ... ... ... ... ... 91,609 77,887 Selling and distribution costs ... ... ... ... ... ... (10,903) (9,618) Administrative expenses ... ... ... ... ... ... ... (43,594) (41,374) OPERATING PROFIT ... ... ... ... ... ... ... ... 37,112 26,895 Finance income ... ... ... ... ... ... ... ... 7 1,305 1,414 Finance costs ... ... ... ... ... ... ... ... 7 (2,965) (4,284) Share of profit of associate company ... ... ... ... ... 14 65 69 PROFIT BEFORE TAXATION AND MOVEMENT IN FAIR VALUE OF INTEREST RATE SWAP... ... ... ... ... ... ... 35,517 24,094 Additional year-on-year unrealised (loss) / (1,257) gain on 10 year interest rate swap derivative ... ... ... ... 113 PROFIT BEFORE TAXATION ... ... ... ... ... ... ... 5 34,260 24,207 Tax on profit ... ... ... ... ... ... ... ... ... ... 8 (8,082) (6,491) PROFIT AFTER TAXATION ... ... ... ... ... ... ... 26,178 17,716 ATTRIBUTABLE TO:... ... ... ... ... ... ... ... ... 24,569 Equity holders of the parent ... ... ... ... ... ... ... 16,902 Non-controlling interests ... ... ... ... ... ... ... 1,609 814 PROFIT FOR THE YEAR... ... ... ... ... ... ... ... 26,178 17,716 BASIC AND DILUTED EARNINGS PER ORDINARY SHARE (in pence) 9 327.17p 224.53p * Finance income and expense for the prior year have been grossed up to be consistent with the current year presentation. ** The Chairman’s statement refers to trading profit, which is the profit before taxation adjusted for the movement in fair value of interest swap as trading profit. The notes on pages 56 to 106 form part of these financial statements. 50 FINANCIAL STATEMENTS GOODWIN PLC CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME for the year ended 30th April, 2025 2025 2024 £’000 £’000 PROFIT FOR THE YEAR... ... ... ... ... ... ... ... ... ... 26,178 17,716 OTHER COMPREHENSIVE INCOME / (EXPENSE) ITEMS THAT MAY BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS: (1,852) Foreign exchange translation differences ... ... ... ... ... ... (1,935) Cash flow hedges – effective portion of changes in fair value ... ... ... 5,513 (936) Cash flow hedges – ineffectiveness transferred to profit or loss... ... ‒ 433 Cash flow hedges – amounts transferred to profit or loss ... ... ... (1,593) (438) Cash flow hedges – deferred tax (charge) / credit ... ... ... ... ... (806) 85 Cost of hedging – changes in fair value ... ... ... ... ... ... ... (97) 558 Cost of hedging – ineffectiveness transferred to profit or loss ... ... ‒ 28 Cost of hedging – amounts transferred to profit or loss ... ... ... 209 144 Cost of hedging – deferred tax (charge) / credit ... ... ... ... ... (33) (184) OTHER COMPREHENSIVE INCOME / (EXPENSE) FOR THE YEAR NET OF INCOME TAX ... ... ... ... ... ... ... ... 1,341 (2,245) TOTAL COMPREHENSIVE INCOME FOR THE YEAR ... ... 27,519 15,471 ATTRIBUTABLE TO:... ... ... ... ... ... ... ... ... Equity holders of the parent ... ... ... ... ... ... ... 25,870 15,039 Non-controlling interests ... ... ... ... ... ... ... 1,649 432 27,519 15,471 The notes on pages 56 to 106 form part of these financial statements. 51 FINANCIAL STATEMENTS GOODWIN PLC CONSOLIDATED BALANCE SHEET at 30th April, 2025 2025 2024 NON-CURRENT ASSETS Note £’000 £’000 116,832 Property, plant and equipment ... ... ... ... ... ... 11 105,337 Right-of-use assets ... ... ... ... ... ... ... ... 12 6,055 11,744 Investment in associate ... ... ... ... ... ... ... ... 14 775 828 Intangible assets ... ... ... ... ... ... ... ... ... 15 27,670 25,900 Derivative financial assets ... ... ... ... ... ... ... 16 6,061 5,716 CURRENT ASSETS 157,393 149,525 39,096 Inventories ... ... ... ... ... ... ... ... ... ... 17 46,809 Contract assets ... ... ... ... ... ... ... ... ... 4 24,310 22,027 Trade and other receivables ... ... ... ... ... ... ... 18 42,390 31,894 Corporation tax receivable ... ... ... ... ... ... ... 1,583 1,288 Derivative financial assets ... ... ... ... ... ... ... 16 4,457 2,007 Cash and cash equivalents ... ... ... ... ... ... ... 19 16,643 30,678 128,479 134,703 TOTAL ASSETS ...... ... ... ... ... ... ... ... ... 285,872 284,228 CURRENT LIABILITIES 16,420 Borrowings ... ... ... ... ... ... ... ... ... ... 20 14,027 Contract liabilities ... ... ... ... ... ... ... ... 4 34,750 14,856 Trade and other payables ... ... ... ... ... ... ... 21 37,159 30,830 Corporation tax payable ... ... ... ... ... ... 1,092 859 Derivative financial liabilities ... ... ... ... ... ... 22 256 251 Provisions for liabilities and charges ... ... ... ... ... 23 223 231 NON-CURRENT LIABILITIES 89,900 61,054 15,707 Borrowings ... ... ... ... ... ... ... ... ... ... 20 61,906 Contract liabilities ... ... ... ... ... ... ... ... 4 20,412 19,268 Derivative financial liabilities ... ... ... ... ... ... 22 428 277 Provisions for liabilities and charges ... ... ... ... ... 23 269 274 Deferred tax liabilities ... ... ... ... ... ... ... ... 24 16,948 14,799 53,764 96,524 TOTAL LIABILITIES... ... ... ... ... ... ... ... ... 143,664 157,578 NET ASSETS ... ... ... ... ... ... ... ... ... ... 142,208 126,650 EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT 751 Share capital ... ... ... ... ... ... ... ... ... 25 751 Translation reserve ... ... ... ... ... ... ... ... 25 (4,223) (2,391) Cash flow hedge reserve ... ... ... ... ... ... ... 25 3,657 633 Cost of hedging reserve ... ... ... ... ... ... ... 25 (317) (426) Retained earnings ... ... ... ... ... ... ... ... ... 138,295 123,714 TOTAL EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT 138,163 122,281 NON-CONTROLLING INTERESTS... ... ... ... ... ... 13 4,045 4,369 TOTAL EQUITY ...... ... ... ... ... ... ... ... ... 142,208 126,650 * Contract liabilities are predominantly advance payments from customers. These financial statements were approved by the Board of Directors on 29th July, 2025, and signed on its behalf by: T. J. W. Goodwin M. S. Goodwin S. R. Goodwin Director Director Director Company Registration Number: 305907 The notes on pages 56 to 106 form part of these financial statements. 52 FINANCIAL STATEMENTS GOODWIN PLC CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended 30th April, 2025 Cash Total Trans- attributable Share flow Cost of to equity Non- lation hedge hedging Retained holders of controlling Total Capital reserve reserve reserve earnings the parent interests equity YEAR ENDED £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 30TH APRIL, 2025 751 (2,391) 633 (426) 123,714 122,281 4,369 126,650 Balance at 1st May, 2024 ... Total comprehensive income: Profit for the year ... ... Other comprehensive income: Foreign exchange translation differences ... ... ... Effective portion of changes in fair value ... ... ... Amounts reclassified to profit or loss ... ... Deferred tax charge ... Other comprehensive income / (expense) for the year TOTAL COMPREHENSIVE INCOME / (EXPENSE) FOR THE YEAR Transactions with owners: ‒ ‒ ‒ ‒ 24,569 24,569 1,609 26,178 ‒ (1,832) ‒ ‒ ‒ (1,832) (20) (1,852) ‒ ‒ 5,449 (81) ‒ 5,368 48 5,416 ‒ ‒ (1,665) 226 ‒ (1,439) 55 (1,384) ‒ ‒ (760) (36) ‒ (796) (43) (839) ‒ (1,832) 3,024 109 ‒ 1,301 40 1,341 ‒ (1,832) 3,024 109 24,569 25,870 1,649 27,519 Dividends paid ... ... ‒ ‒ ‒ ‒ (9,988) (9,988) (1,973) (11,961) BALANCE AT 30TH APRIL, 2025 751 (4,223) 3,657 (317) 138,295 138,163 4,045 142,208 The notes on pages 56 to 106 form part of these financial statements. 53 FINANCIAL STATEMENTS GOODWIN PLC CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (continued) for the year ended 30th April, 2024 Share- Cash Total Trans- attributable Share based flow Cost of to equity Non- lation payment hedge hedging Retained holders of controlling Total Capital reserve reserve reserve reserve earnings the parent interests equity £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 YEAR ENDED 30TH APRIL, 2024 Balance at 1st May, 2023 ... 769 (849) 5,244 1,504 (976) 119,055 124,747 4,410 129,157 Total comprehensive income: Profit for the year ... ... Other comprehensive income: Foreign exchange translation differences ... ... ... Effective portion of changes in fair value ... ... ... Ineffectiveness transferred to profit or loss ... ... Amounts reclassified to profit or loss ... ... Deferred tax (charge) / credit Other comprehensive income / (expense) for the year TOTAL COMPREHENSIVE INCOME / (EXPENSE) FOR THE YEAR Transfers between reserves Transactions with owners: Buy back of shares Dividends paid ... ... BALANCE AT 30TH APRIL, 2024 ‒ ‒ ‒ ‒ ‒ 16,902 16,902 814 17,716 ‒ (1,542) ‒ ‒ ‒ ‒ (1,542) (393) (1,935) ‒ ‒ ‒ (948) 560 ‒ (388) 10 (378) ‒ ‒ ‒ 432 28 ‒ 460 1 461 ‒ ‒ ‒ (438) 144 ‒ (294) ‒ (294) ‒ ‒ ‒ 83 (182) ‒ (99) ‒ (99) ‒ (1,542) ‒ (871) 550 ‒ (1,863) (382) (2,245) ‒ (1,542) ‒ (871) 550 16,902 15,039 432 15,471 ‒ ‒ (5,244) ‒ ‒ 5,244 ‒ ‒ ‒ (18) ‒ ‒ ‒ ‒ (8.851) (8.869) ‒ (8.869) ‒ ‒ ‒ ‒ ‒ (8,636) (8,636) (473) (9,109) 751 (2,391) ‒ 633 (426) 123,714 122,281 4,369 126,650 * The balance on the share-based payment reserve was transferred to retained earnings as all previous share options had vested. The notes on pages 56 to 106 form part of these financial statements. 54 FINANCIAL STATEMENTS GOODWIN PLC CONSOLIDATED STATEMENT OF CASH FLOWS for the year ended 30th April, 2025 2025 2024 CASH FLOW FROM OPERATING ACTIVITIES Note £’000 £’000 26,178 Profit from continuing operations after tax ... ... ... ... 17,716 Adjustments for: 6,663 Depreciation of property, plant and equipment ... ... ... 6,607 Depreciation of right-of-use assets ... ... ... ... ... 1,346 1,497 Amortisation and impairment of intangible assets ... ... ... 1,580 1,341 Finance costs (net) ... ... ... ... ... ... ... ... 1,660 2,870 Currency losses / (gains) ... ... ... ... ... ... ... 1,371 (1,025) Loss / (profit) on sale of property, plant and equipment ... ... 126 (29) Unrealised (loss) / gain on 10 year interest rate swap derivative 1,257 (113) Share of profit of associate company ... ... ... ... ... (65) (69) UK tax incentive credit on research and development ... ... (573) (660) Tax expense ... ... ... ... ... ... ... ... ... ... 8,082 6,491 OPERATING CASH FLOW BEFORE CHANGES IN WORKING CAPITAL AND PROVISIONS 47,625 34,626 Decrease in inventories ... ... ... ... ... ... ... ... 6,743 437 (Increase) in contract assets ... ... ... ... ... ... ... (2,121) (5,849) (Increase) / decrease in trade and other receivables ... ... (12,095) 2,357 Increase in contract liabilities ... ... ... ... ... ... 20,990 1,388 Increase in trade and other payables ... ... ... ... ... 6,100 370 CASH GENERATED FROM OPERATIONS 67,242 33,329 Interest received ... ... ... ... ... ... ... ... ... 1,340 1,399 Interest paid ... ... ... ... ... ... ... ... ... (3,822) (5,022) Corporation tax paid ... ... ... ... ... ... ... ... (6,566) (2,587) NET CASH INFLOW FROM OPERATING ACTIVITIES... ... 58,194 27,119 CASH FLOW FROM INVESTING ACTIVITIES 125 Proceeds from sale of property, plant and equipment ... ... 392 Acquisition of property, plant and equipment ... ... ... (13,176) (15,363) Acquisition of intangible assets ... ... ... ... ... ... (283) (582) Development expenditure capitalised ... ... ... ... ... (2,832) (1,456) Dividend from associate company ... ... ... ... ... ... 156 131 NET CASH OUTFLOW FROM INVESTING ACTIVITIES... ... (16,010) (16,878) CASH FLOW FROM FINANCING ACTIVITIES ‒ Buy back of shares ... ... ... ... ... ... ... ... (8,869) Payment of capital element of lease liabilities ... ... ... (6,073) (2,910) Dividends paid... ... ... ... ... ... ... ... ... (9,988) (8,636) Dividends paid to non-controlling interests ... ... ... ... (1,973) (473) Proceeds from new loans ... ... ... ... ... ... ... 12,000 23,098 Repayment of loans ... ... ... ... ... ... ... ... (49,837) (1,152) Change in bank overdrafts ... ... ... ... ... ... ... (48) (71) NET CASH (OUTFLOW) / INFLOW FROM FINANCING ACTIVITIES (55,919) 987 NET (DECREASE) / INCREASE IN CASH AND CASH EQUIVALENTS (13,735) 11,228 Cash and cash equivalents at beginning of year ... ... ... 30,678 19,661 Effect of exchange rate fluctuations on cash held ... ... ... (300) (211) CASH AND CASH EQUIVALENTS AT END OF YEAR ... ... 19 16,643 30,678 The notes on pages 56 to 106 form part of these financial statements. 55 FINANCIAL STATEMENTS 1. Accounting policies Goodwin PLC (the “Company”) is incorporated in England and Wales. The Group financial statements compromise those of the Company, its subsidiaries and its associate company (together referred to as the “Group”). The parent Company financial statements present information about the Company as a separate entity and not about its Group. The Group’s financial statements have been prepared in accordance with UK Company Law, UK adopted International Accounting Standards (IAS) and interpretations issued by the IFRS Interpretations Committee (IFRS IC) applicable to companies reporting under UK adopted IFRS. The Company has elected to prepare its financial statements in accordance with Financial Reporting Standard (FRS) 101 issued in the UK. These are presented on pages 93 to 105. The accounting policies set out below have been applied consistently to all periods presented in these Group financial statements. In the application of these accounting policies, judgements made by the Directors, that have a significant effect on the financial statements and estimates with a possible significant risk of material adjustment in the next year, are discussed in note 2. Going concern The Directors, after having reviewed the Group forecasts and possible challenges that may occur over the short to medium term, are confident that the Group has adequate resources to continue to operate for at least twelve months from the date that these financial statements are approved and have continued to adopt the going concern principle in preparing the financial statements. As at 30th April 2025, the Group’s gearing ratio stood at 9.9% (2024: 35.1%) which is due to a reduction in net debt of £29.3 million against a substantial shareholders’ net worth of £138 million (2024: £122 million). The retained reserves of the Group and the increased headroom in lender facilities put it in a strong position to deal with any material unforeseen adverse issues that may occur and have an impact on the Group’s operations. As part of the going concern process, the Group forecasts are stress tested by being subject to a number of severe but conceivable financial challenges to ensure that the Group finances remain robust throughout the period being tested. The stress test model begins with the Group forecasts, that have been consolidated from the individual forecasts generated by the Directors of each of the subsidiaries and reflects their specific knowledge of their business and the markets within which they operate, to ensure that the forecasts that they produce reflect the market conditions, the business strategy and expected outlook. Each of these subsidiary level forecasts is then reviewed, challenged and approved by the relevant Divisional Managing Director, who is immersed in each of these businesses to such an extent that they know and understand each of their markets. As the Group is so diverse, with two divisions in different sectors and multiple different products within each division, several stress test events are used to reduce the pre-tax profit forecasts by reducing revenues and consequently the pre-tax profit. Due to this diversity, it is feasible that one or two events could take place, but it is highly improbable that all the stress test events would occur at the same time. The stress tests implemented reduced revenues and consequently pre-tax profits, which for these stress tests implemented reduced pre-tax profit by a combined amount of 74%, without reducing the discretionary capital expenditure programme, maintaining overheads at their current expected levels, maintaining the dividend policy and utilising the finance facilities at the same amounts that will be in place twelve months from the signing of these accounts. The results of the stress test modelling did not highlight any going concern issues, breaches of covenant need to reduce the discretionary capital expenditure, make any changes to overheads, reduce or cancel the payment of a dividend or the requirement for any further financing facilities in addition to those currently in place at the year end. Post year end, the Group has renewed one of its Revolving Credit Facilities, that was due to expire, for a four-year term. Whilst our carrying values of trade debtors and contract assets are significant, we see little risk here in terms of recovery due to the quality of the customers that the Group contracts with. Where possible, we credit insure the majority of our trade debtors and our pre-credit risk (work in progress), and for significant contracts where credit insurance is not available we ensure, where possible, that those contracts are backed by letters of credit or cash positive milestone payments. As discussed elsewhere within these accounts, the Mechanical Engineering order book remains high and the Refractory Engineering segment continues to be buoyant. The Directors are confident that the Group and Company will have sufficient funds to continue to meet their liabilities as they fall due for at least twelve months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis. Measurement convention The financial statements are rounded to the nearest thousand pounds. The financial statements are based on the historical cost basis, except where the measurement of balances at fair value is required, as below. Basis of consolidation Subsidiaries are entities controlled by the Group. Control exists when the Group has the power, directly or indirectly, to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The Group controls an entity when it 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. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. 56 NOTES TO THE FINANCIAL STATEMENTS 1. Accounting policies (continued) Basis of consolidation (continued) Associates are those entities in which the Group has significant influence, but not control, over the financial and operating policies. Significant influence is presumed to exist when the Group holds between 20 and 50 percent of the voting power of another entity. Associates are accounted for using the equity method and are initially recognised at cost. The Group’s investment includes goodwill identified on acquisition, net of any accumulated impairment losses. The consolidated financial statements include the Group’s share of the total recognised income and expense and equity movements of equity accounted investees, from the date that significant influence commences until the date that significant influence ceases. When the Group’s share of losses exceeds its interest in an equity accounted investee, the Group’s carrying amount is reduced to nil, and recognition of further losses is discontinued, except to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of an investee. Foreign currency The functional and presentational currency of the Group is Pound Sterling (£). Where foreign currency transactions are hedged, the transactions are recorded at their hedged rate. All other transactions in foreign currencies are translated into the respective functional currencies of the Group entities at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the foreign exchange rate ruling at that date. Foreign exchange movements associated with hedged transactions are recognised in the cash flow hedge reserve, whilst non-hedged foreign exchange differences arising on translation are recognised in the statement of profit or loss within operating profit. The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on consolidation, are translated to Sterling at foreign exchange rates ruling at the balance sheet date. The revenues and expenses of foreign operations are translated at an average rate for the period where this rate approximates to the foreign exchange rates ruling at the dates of the transactions. Exchange differences arising from the translation of foreign operations are taken directly to the translation reserve. They are released into the statement of profit or loss upon disposal of the foreign operation. New IFRS standards and interpretations adopted during 2024 / 2025 The IASB and IFRIC issued the following amendments: • Amendments to IAS 1 Presentation of Financial Statements: Classification of Liabilities as Current or Non- Current – (effective for periods commencing on or after 1st January 2024). • Amendments to IAS 1 Presentation of Financial Statements: Non-Current Liabilities with Covenants – (effective for periods commencing on or after 1st January 2024). The implementation of these amendments has not had a material impact on the Group’s financial statements.true IFRS standards and interpretations not adopted Amendments to existing standards or new standards and interpretations that have been issued but are not yet effective and have not been adopted by the Group are listed below: • Amendments to IFRS 9 and IFRS 7: Amendments to the Classification and Measurement of Financial Instruments (effective for periods commencing on or after 1st January 2026). • Annual Improvements to IFRS Accounting Standards - Volume 11 (effective for periods commencing on or after 1st January 2026). • IFRS 18 Presentation and Disclosure in Financial Statements (effective for periods commencing on or after 1st January 2027). The impact of IFRS 18, which becomes effective for annual reporting periods beginning on or after 1 January 2027, has not been fully evaluated as yet, but the Group does not expect that any of the other standards, amendments or interpretations issued by the IASB, but not yet effective, will have a material impact on the financial statements once adopted. Revenue Revenue is recognised when a customer obtains control of the goods or services i.e. upon the satisfaction of a performance obligation. Judgement is required to determine the timing of the transfer of control, and whether it is at a point in time or over time. Where a contract contains several performance obligations then the contract is unbundled and each performance obligation is assessed separately. Where the contract period is less than one year, the incremental costs of winning a contract are recognised as an expense, when they are incurred, in accordance with the practical expedient in IFRS15, paragraph 94. Standard inventory product lines and consumables These contracts are, typically, for the sale of slurry pumps within the Mechanical Engineering Division and for all of the Group’s Refractory Engineering Division products. The revenue here relates to standard products manufactured for sale. The performance obligation is satisfied and revenue recognised at the point when customers obtain control of the goods in accordance with the International Commercial (INCO) terms agreed. 57 NOTES TO THE FINANCIAL STATEMENTS 1. Accounting policies (continued) There are also bill and hold arrangements, where control passes to the customer once the customer confirms that the job has been completed, but where the goods are yet to be collected and remain at the Company premises. Engineered bespoke products – performance obligations satisfied at a point in time These contracts are, typically, for the Group’s Mechanical Engineering Division, and contain sales orders which are customer bespoke, but permit the subsidiary company to claim profit only on completion of the project or only the costs incurred to date in the event the customer activates the cancel for convenience clause within the contract. In such cases, the performance obligation is deemed to be met and revenue taken as order lines are shipped in accordance with the relevant shipping terms or via a bill and hold arrangement, whereby control passes to the customer, once the customer confirms that the job has been completed, but where the goods are yet to be collected, and remain at the Company premises. Minimum period contracts for the provision of goods and services Performance obligations are satisfied over time and revenue is recognised equally over the term of contracts for the supply of broadband related services and the rental of submersible pumps. Engineered bespoke products – performance obligations satisfied over time These contracts are typically for the Group’s Mechanical Engineering Division contain sales orders which are customer bespoke, and have a cancel for convenience clause. This clause then permits the subsidiary Company to claim profit as the project progresses over time to completion and, if the customer were to trigger the cancel for convenience clause within the contract, claim profit from the customer to that point in time. In such cases, the performance obligations are treated as satisfied over time (i.e. as the contract progresses) and revenue is taken based on the percentage completion of the contract by the creation of a contract asset. Work in progress is eliminated and replaced by a contract asset. Measuring progress requires judgement, as to the stage of completion of each job, and the production of forecasts of costs to complete, which contain allowances for technical risks and inherent uncertainties. The input method is considered to be the most appropriate, because costs are the significant indicator of the job performance and expected contract profitability. Using the input method, costs to date are factual and based on job cost records. As jobs progress through the factories, the cost estimate sheets, generated at order placement, are adjusted for known time-based or commodity-based variances. The cost estimate sheets are the source for the calculation of the total estimated costs on a job. At both senior and middle management level, there is a high level of continuity and expertise to interrogate the costings, to arrive at an appropriate assessment of the total costs on a job, and to then determine the percentage of completion for each contract. The contracts within the Group do not include variable consideration. Contract modifications Where the Group has modifications or variations to a contract, then these are included in the contract calculations only when there is a high probability that they are certain to occur, which the Group considers to be when there is a signed agreement in place. Contract assets / contract liabilities Contract assets represent the Group’s rights to consideration for work completed but not invoiced at the reporting date for bespoke product contracts where, as part of the contract terms, there is a termination for convenience clause which, if invoked, allows the Group company to charge for profit earned to date. Contract assets are transferred to receivables when the rights to consideration become unconditional, which is generally when the Group invoices the customer. Where payments are received in advance and exceed the costs incurred in constructing the asset together with forecast margin earned, the balances are disclosed as contract liabilities. Employment costs Pension costs The Group contributes to a defined contribution pension scheme for UK employees under an Auto Enrolment Pension arrangement as required by Government legislation. The assets of the scheme are held in independently administered funds. Group pension costs are charged to the statement of profit or loss in the year for which contributions are payable. Contributions to the schemes are made on a monthly basis and at the end of the financial year there were one month’s contributions outstanding, which were paid in the following month. Termination costs Employee termination costs are expended in the profit and loss figures in a year as soon as the expense is known, certain and is contractually payable. Share-based payment transactions Share-based payments arrangements, in which the Group receives goods or services as consideration for its own equity instruments, are accounted for as equity-settled share-based payment transactions, regardless of how the equity instruments are obtained by the Group. 58 NOTES TO THE FINANCIAL STATEMENTS 1. Accounting policies (continued) Employment costs (continued) The grant date fair value of share-based payment awards granted to employees is recognised as an expense, with a corresponding increase in equity, over the period in which the employees become unconditionally entitled to the awards. The fair value of the awards is measured using an option valuation model, taking into account the terms and conditions upon which the awards were granted. Finance income and costs Finance costs comprise interest payable (together with the amortisation of any facility arrangement fees) and interest on lease liabilities using the effective interest method. Borrowing costs directly attributable to the acquisition, construction or production of an asset that takes a substantial time to be prepared for use are capitalised as part of the cost of that asset. Interest income and interest payable is recognised in the statement of profit or loss as it accrues. Taxation Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the statement of profit or loss except to the extent that it relates to items recognised, in other comprehensive income. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years. Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for: the initial recognition of goodwill, the initial recognition of assets or liabilities that affect neither accounting nor taxable profit other than in a business combination, and differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date. Deferred tax liabilities are generally recognised for all taxable temporary differences but not recognised for taxable temporary differences arising on investments in subsidiaries, where the reversal of the temporary difference can be controlled and it is probable that the difference will not reverse in the foreseeable future. A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Financial instruments Measurement Trade and other receivables, which do not contain a significant financing component, are measured, initially, at the transaction price. All other financial assets and liabilities are measured at fair value, on initial recognition. Non-derivative financial assets are measured subsequently at amortised cost, if the objective is to hold them to collect contractual cash flows and their contractual terms include cash flows on specified dates, which are payments of principal and interest. Impairment The Group has elected to measure loss allowances for trade receivables and contract assets at an amount equal to lifetime expected credit losses (ECLs). Specific impairments are made when there is a known impairment need against trade receivables and contract assets. When estimating ECLs, the Group assesses reasonable, relevant and supportable information, which does not require undue cost or effort to produce. This includes quantitative and qualitative information and analysis, incorporating historical experience, informed credit assessments and forward- looking information. Loss allowances are deducted from the gross carrying amount of the assets. Where material, impairment losses related to trade and other receivables, including contract assets, are disclosed separately in the statement of profit or loss. Principal non-derivative financial assets Trade receivables Trade receivables are amounts due from customers for goods sold or services performed in the ordinary course of business. They are recognised initially at the amount of consideration that is unconditional. Trade receivables are held with the intention of collecting the contractual cash flows and are measured subsequently, therefore, at amortised cost. Other financial assets Other financial assets comprise, principally, short-term balances, which include sales taxes repayable to the Group. After being recognised initially at fair value, other receivables are measured, subsequently, at amortised cost. The carrying amount of other receivables is considered to be a reasonable approximation of their fair value. Cash and cash equivalents Cash and cash equivalents comprise cash at bank and in hand, together with cash deposits with an original maturity of three months or less. 59 NOTES TO THE FINANCIAL STATEMENTS 1. Accounting policies (continued) Financial instruments (continued) Principal non-derivative financial liabilities Bank borrowings Interest-bearing bank loans and overdrafts are measured, initially, at their fair value less attributable transaction costs. They are carried, subsequently, at amortised cost and finance charges are recognised in the statement of profit or loss over the contract term, using an effective rate of interest. Trade and other payables Trade and other payables are recognised, initially, at fair value, and are reported, subsequently, at amortised cost. Derivative financial assets and liabilities Derivative financial assets and liabilities are recognised at fair value. The fair value of forward foreign exchange contracts is equal to the present value of the difference between the contractual forward price and the current forward price for the residual maturity of the contract, adjusted for counterparty credit risk. The recognition of the gain or loss on re-measuring to fair value those forward foreign exchange contracts, which are used for hedging, is outlined below. For other forward exchange contracts and the interest rate swap derivative, the gain or loss is recognised in the profit or loss. Fair value derivation IFRS 7 requires that the classification of financial instruments at fair value be determined by reference to the source of inputs used to derive the fair value. This classification uses the following three-level hierarchy: 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 (i.e. as prices) or indirectly (i.e. derived from prices); Level 3 — inputs for the asset or liability that are not based on observable market data (unobservable inputs). The fair value of derivative financial assets and liabilities is derived using level 2 inputs. As at the year-end, the Group held currency derivatives and an interest rate swap derivative. For the currency derivatives, the valuations are based on the period end currency rates, as adjusted for the forward points to maturity, the time value of money and the banks’ assessed credit risk and margin. For the interest rate swap derivative, the valuation is arrived at by comparing the forward interest curve as at 30th April, 2025 out to maturity against our fixed swap rate. The result is then discounted for the time value of money and adjusted for credit risk and margin. Cash flow hedges Where a derivative financial instrument is designated as a hedge of the variability in cash flows of a recognised asset or liability, or a highly probable forecast transaction, the effective part of any gain or loss on the derivative financial instrument is recognised directly in the hedging reserve. The Group’s hedge relationships are aligned with its risk management objectives and strategy, resulting in a more qualitative and forward-looking approach in ensuring hedge effectiveness. These hedging arrangements have been put in place to mitigate foreign currency exchange risk arising from certain highly probable sales and purchases transactions denominated in foreign currencies. For cash flow hedges, the associated cumulative gain or loss on the relevant derivative financial instrument is removed from equity and recognised in the statement of profit or loss in the same period or periods during which the hedged forecast transaction affects the statement of profit or loss. Any identified ineffective portion of the hedge is recognised immediately in the statement of profit or loss. Until 30th April, 2023, only the change in spot rate was designated as the hedging instrument, with the change in fair value relating to forward points being reported separately as deferred costs of hedging within other comprehensive income as permitted by IFRS 9. From 1st May, 2023, the full value of the change in fair value is designated as the hedging instrument and taken to the cash flow hedge reserve. Where a derivative financial instrument is not hedge accounted, all changes in fair value are recognised immediately in profit or loss. When a hedging instrument expires or is sold, terminated or exercised, or the Group revokes designation of the hedge relationship but the hedged forecast transaction is still expected to occur, the cumulative gain or loss at that point remains in equity and is recognised in accordance with the above policy when the transaction occurs. If the cash flow hedge transaction is no longer expected to take place, the cumulative unrealised gain or loss recognised in equity is recognised in the statement of profit or loss immediately, within administration expenses. Intangible assets and goodwill All business combinations are accounted for by applying the purchase method. Goodwill is recognised as the difference between the consideration transferred and the fair value of identifiable assets, liabilities and contingent liabilities assumed in a business combination. Identifiable intangibles are those which can be sold separately or which arise from legal rights regardless of whether those rights are separable. 60 NOTES TO THE FINANCIAL STATEMENTS 1. Accounting policies (continued) Intangible assets and goodwill (continued) Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to cash-generating units and is not amortised but is tested annually for impairment. Negative goodwill arising on an acquisition is recognised immediately in the statement of profit or loss. Goodwill or negative goodwill resulting from increasing the percentage ownership of an existing subsidiary is reported as an equity transaction with owners. Expenditure on research activities is recognised in the statement of profit or loss as an expense as incurred. Expenditure on development activities is capitalised if the product or process is technically and commercially feasible and the Group has sufficient resources to complete development. The expenditure capitalised includes the cost of materials, direct labour and an appropriate proportion of overheads. Other development expenditure is recognised in the statement of profit or loss as an expense as incurred. Capitalised development expenditure is stated at cost less accumulated amortisation and impairment losses. Other intangible assets that are acquired by the Group are stated at cost less accumulated amortisation and impairment losses. Amortisation is charged to the statement of profit or loss on a straight-line basis over the estimated useful lives of intangible assets unless such lives are indefinite. Intangible assets with an indefinite useful life and goodwill are systematically tested for impairment at each balance sheet date. Other intangible assets are amortised from the date they are available for use. The estimated useful lives are as follows: • Capitalised development costs ... ... Minimum expected order unit intake or minimum product life • Manufacturing rights ... ... ... ... 6 - 15 years • Brand names and intellectual property ... 3 - 20 years • Customer lists ... ... ... ... ... 2 - 10 years • Distribution rights ... ... ... ... 25 years • Software and licences ... ... ... 3 - 5 years • Non-compete agreements ... ... ... 15 years Property, plant and equipment Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses. Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items of property, plant and equipment. Depreciation is charged to the statement of profit or loss over the estimated useful lives of each part of an item of property, plant and equipment on the following bases: • Freehold land … … … … … Nil • Freehold buildings … … … … 25 – 50 years on reducing balance or cost • Leasehold property … … … ... over period of lease • Plant and machinery … … … ... 4 – 20 years on reducing balance or cost • Motor vehicles … … … … 4 – 7 years on reducing balance or cost • Tooling … … … … … over estimated production life • Other equipment … … … … 4 – 7 years • Assets in the course of construction ... Nil Before being brought into use, assets are assessed individually to determine which is the most appropriate depreciation method. At present, most assets are being depreciated on a reducing balance basis. Leases Definition of a lease A contract is a lease or contains a lease if it transfers the right to use an identified asset over the contract term, in exchange for payment. In determining whether a contract gives the Group the right to use an asset, the Group assesses whether: • the contract involves the use of an identified asset; • the Group has the right to obtain substantially all of the economic benefit of using the asset; and • the Group has the right to direct the use of the asset by deciding how the asset is employed. Lease term The lease term is the non-cancellable period of a lease, and options to extend the lease or terminate it, where it is probable that the Group will exercise the available options. At the start of a lease, the Group makes a judgement about whether it is reasonably certain to exercise the options, and reassesses this judgement when a change in circumstance may affect the likelihood of exercising the options. Contracts, where the original lease term has expired, with assets continuing to be leased on a short-term rolling basis of a few months, are treated as short-term leases. 61 NOTES TO THE FINANCIAL STATEMENTS 1. Accounting policies (continued) Leases (continued) Lease balances A right-of-use asset and a lease liability are calculated at the beginning of a lease. The right-of-use asset is measured initially at cost, being the opening lease liability, adjusted for any lease payments made by the start of the lease for any initial direct costs, which have been incurred. The lease liability is measured initially at the present value of the lease payments, which are outstanding at the start date, discounted at either the rate implicit in the lease or the Group’s incremental borrowing rate. With the exception of leases containing an option to purchase, the Group uses its incremental borrowing rate as the discount rate. Lease liabilities are measured at amortised cost, using the effective rate, and adjusted, as required, for any subsequent change to the lease terms. The right-of-use asset is depreciated on a straight-line basis over the lease term, or from the start date of the lease to the end of the useful life of the right-of-use asset as appropriate. The method of calculating the estimated useful lives of the right-of-use assets and testing for impairment is the same as that for property, plant and equipment. Recognition exemptions Payments for short-term leases, lasting twelve months or less, without a purchase option, continue to be reported as an operating expense on a straight-line basis over the term of the lease. The cost of leasing low-value items will continue to be reported as an operating expense over the life of the lease. Lease portfolios The Group has leases for the following types of assets: Land and buildings – the Group leases a number of factory buildings, warehouses and office buildings. Plant and equipment – a number of significant items of plant, such as CNC machines and furnaces, have been leased under contracts with an option to buy the asset at the end of the lease term. The Group also leases motor vehicles. For motor vehicles the Group has applied the practical expedient in paragraph 15 of IFRS 16, whereby non-lease components have not been separated from lease components, such that lease costs and service costs are treated as a single lease component. Printers and photocopiers – the Group has applied the recognition exemption for low-value assets to these leases. Government grants Government grants relating to income are recognised in the statement of profit or loss. Government grants relating to assets are recognised in the balance sheet as a deduction in the carrying amount of the asset. Depreciation is charged on the value of the asset less the associated grant. Impairment of intangibles The carrying amounts of the Group’s assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated. The recoverable amount is the greater of an asset’s or cash-generating unit’s (CGU) fair value less costs to sell or value in use. For goodwill, assets that have an indefinite useful life and intangible assets that are not yet available for use, the recoverable amount is estimated at each balance sheet date. An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognised in the statement of profit or loss. Reversals of impairment An impairment loss in respect of goodwill is not reversed. In respect of other assets, an impairment loss is reversed when there is an indication that the impairment loss may no longer exist and there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset of CGU’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. Inventories Inventories are stated at the lower of cost and net realisable value. Cost is based on the first-in, first-out principle and includes expenditure incurred in acquiring the inventories and bringing them to their existing location and condition. In the case of manufactured inventories and work in progress, cost includes an appropriate share of overheads based on normal operating capacity. Provisions Warranty provisions The Group carries a warranty provision where applicable. The warranties are committed at contract placement stage and typically, where given to a customer, the warranty has a duration of between 1 and 3 years. At the expiry of the warranty period, to the extent not utilised, the warranty provision is then released back into the statement of profit or loss. The warranties are generally passive in nature, confirming that the goods comply with contractual specifications. Given that the incidence of product failure is low, the warranties have no tangible customer value. 62 NOTES TO THE FINANCIAL STATEMENTS 2. Accounting estimates and judgements The Group makes judgements and estimates in applying the Group’s accounting policies, to prepare the financial statements. Key estimates and judgements IFRS 15 Revenue Recognition The Directors consider that a key estimate, which may have a material impact on the financial statements, is in relation to IFRS 15 and, in particular, where revenue for some of our Mechanical Engineering work in progress contracts is recognised overtime. When reviewing the terms of contracts with customers, judgement is required to assess the number of performance obligations within the contracts and when to recognise contract provisions. For contracts where revenue is recognised over time, there is a need to estimate the costs to complete on these contracts. The costs to complete estimates can be complex, as they need to consider several variable factors such as the impact of delays, cost overruns and also any variations to contract. Once complete, these estimates then drive the amount of revenue recognised. The estimates are prepared and reviewed by management, with suitable experience and qualifications, who endeavour to ensure that the revenue recognised prior to the completion of the contract is not under or overstated, based on possible technical risks and inherent uncertainties. Whilst cost to complete estimates are based on management’s best knowledge at the time, it is clear, due to the very nature of an estimate, that the eventual outcomes may differ due to unforeseen events. However, the advanced stage of completion of a number of contracts reduces the risk of unforeseen events arising, and, given that the initial position taken on material contracts at the balance sheet date is revisited as part of the post balance sheet review process prior to the financial statements being signed off, the risk of a material impact on the financial statements arising from changes in estimates here is considered to be low. The current year’s revenue would be reduced by £993,000, if the costs, absorbed by the Group, to complete contracts in progress at year-end were 1% higher. Claims, which are subject to commercial negotiation, are recognised only when there is a high level of certainty; the Directors consider this to be when there is a signed agreement in place. Consideration is given to the requirements of IFRS 15 in determining the appropriate accounting for the claim settlements, taking into account the nature of the settlement and whether it relates to a point in time or over time revenue contract. Determination of the basis for the amortisation / impairment of intangible assets The Group carries different classes of intangible assets on its balance sheet, which include goodwill, manufacturing rights, brand names and development costs. Capitalised intangible costs are amortised on a straight-line basis, which commences when the Group is expected to benefit from cash inflows. A key estimate is required in determining the useful economic life, over which each asset is to be amortised, with current timeframes ranging from fifteen to twenty-five years. In arriving at the appropriate timeframe for amortisation, there are essentially two key estimates, namely the product life cycle and the amount of profit generated from the expected income streams. In accordance with IAS 38, the basis on which goodwill and other intangible assets are impaired and amortised is assessed annually. The sensitivity of goodwill is considered within note 15 to these financial statements. Reducing by one third the lives of intangible assets, which are more than fifteen years, would reduce the current year pre-tax profits by £475,000 (2024: £420,000). Duvelco viability The Company has invested circa £23 million in the area of high-performance Polyimide resins. The Company, during the financial year, commenced the testing and commissioning of the facility and started producing material, which will be used by targeted customers to perform their acceptance trials of the material. The first commercial sales are expected to occur in the following financial year once acceptance trials have concluded. The judgement of the Board is that the market potential here is significant and that future profitability is expected to be strong. Accordingly, the Directors do not see a need to impair the investment in this area. Apart from above, the Group does not have any key assumptions concerning the future, or other key sources of estimation uncertainty in the reporting period, that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. Other estimates and judgements Other than as reported above, the Directors do not consider there to be any other key estimates or judgements in preparing the financial statements. The estimates and judgements outlined below formed the main areas of focus for the Directors throughout the year. Inventory provisions The Group’s Directors, in conjunction with senior management in the subsidiaries, regularly review the recoverability of their stated raw material and work in progress balances, paying particular attention to net 63 NOTES TO THE FINANCIAL STATEMENTS 2. Accounting estimates and judgements (continued) Other estimates and judgements (continued) realisable value and stock obsolescence issues. The estimates are in relation to costs to complete and the expected level of future sales orders for slow moving stocks. Where it is judged that a provision is deemed necessary, the appropriate adjustments are made in the relevant subsidiary’s books at the time a shortfall is identified. Trade receivable provisions Whilst trade debtors are insured wherever possible, the Directors are able to exercise judgement in relation to non-credit insured contracts as set out in note 27 (a). The Group Directors, in conjunction with the subsidiary credit controllers, closely monitor the adherence to payment terms across all accounts (whether insured or not) and make provision for any losses that are likely to materialise. There is a requirement under IFRS 9 to consider the statistical likelihood of a bad debt based off previous experience. Historically, the Group’s bad debt write-offs have been negligible and the Group results are not impacted by this requirement for a statistically based provision. 3. Segmental information Products and services from which reportable segments derive their revenues For reporting to the chief operating decision maker, the Board of Directors’, and as outlined in the Business Model section of the Strategic Report on page 9, the Group is organised into two reportable operating segments according to the different products and services provided by the Mechanical Engineering and Refractory Engineering Divisions. Segment assets and liabilities include items directly attributable to segments as well as group centre balances which can be allocated on a reasonable basis. The Group’s associate company are included in Refractory Engineering. In accordance with the requirements of IFRS 8, information regarding the Group’s operating segments is reported below. There are no other reportable segments apart from those identified. Year ended 30th April, 2025 Year ended 30th April, 2024 Mechanical Refractory Mechanical Refractory Engineering Engineering Total Engineering Engineering Total Revenue £’000 £’000 £’000 £’000 £’000 £’000 193,045 78,164 271,209 Total revenue ... ... ... 156,944 75,859 232,803 Intra-segment revenue ... (36,783) (14,717) (51,500) (28,912) (12,633) (41,545) External revenue ... ... 156,262 63,447 219,709 128,032 63,226 191,258 Profit Segment operating 25,402 14,606 40,008 profit ... ... ... 18,861 13,423 32,284 Share of profit of associate company ... ... Segment profit before taxation ... ... Group centre costs ... ... Finance income ... ... Finance costs ... ... ... Profit before taxation and movement in fair value of interest rate swap Percentage of segment profit before tax - 65 65 - 69 69 25,402 14,671 40,073 18,861 13,492 32,353 (2,896) (5,389) 1,305 1,414 (2,965) (4,284) 35,517 24,094 63% 37% 100% 58% 42% 100% 64 NOTES TO THE FINANCIAL STATEMENTS 3. Segmental information (continued) Year ended 30th April, 2025 Year ended 30th April, 2024 Group Mechanical Refractory Group Mechanical Refractory Centre Engineering Engineering Total Centre Engineering Engineering Total Net assets £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 16,422 205,272 64,178 285,872 Total assets 17,338 192,608 74,282 284,228 Total liabilities (862) (125,940) (16,862) (143,664) (511) (118,132) (38,935) (157,578) Total 15,560 79,332 47,316 142,208 16,827 74,476 35,347 126,650 For the purposes of monitoring segment performance and allocating resources between segments, the Group’s Board of Directors monitors the tangible and financial assets attributable to each segment. All assets and liabilities are allocated to reportable segments with the exception of some of those held by the parent Company, Goodwin PLC. Year ended 30th April, 2025 Year ended 30th April, 2024 Group Mechanical Refractory Group Mechanical Refractory Centre Engineering Engineering Total Centre Engineering Engineering Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 Segmental capital expenditure Property, plant and 704 12,849 1,457 15,010 equipment 736 10,102 5,583 16,421 Right-of-use 55 86 6 147 assets 180 934 634 1,748 Intangible - 2,611 504 3,115 assets 372 1,209 456 2,037 Total 759 15,546 1,967 18,272 1,288 12,245 6,673 20,206 Segmental depreciation, amortisation and impairment Depreciation 632 4,580 1,451 6,663 - PPE 752 4,400 1,455 6,607 Depreciation 315 594 437 1,346 - ROU 429 578 490 1,497 Amortisation and 98 654 828 1,580 impairment 85 446 810 1,341 Total 1,045 5,828 2,716 9,589 1,266 5,424 2,755 9,445 Geographical segments The Group operates in the following principal locations. In presenting the information on geographical segments, revenue is based on the location of its customers and assets on the location of the assets. Year ended 30th April, 2025 Year ended 30th April, 2024 Non- Capital Non- Capital Net current expendi- Net current expendi- Revenue assets assets ture Revenue assets assets ture £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 UK 63,904 94,113 122,585 12,469 61,595 78,978 117,376 14,887 Rest of Europe 26,671 9,868 8,627 4,186 21,552 6,884 5,132 1,532 USA 35,426 - - - 21,480 - - - Pacific Basin 42,726 15,246 6,290 171 42,903 17,374 7,009 692 Rest of World 50,982 22,981 13,830 1,446 43,728 23,414 14,292 3,095 Total 219,709 142,208 151,332 18,272 191,258 126,650 143,809 20,206 65 NOTES TO THE FINANCIAL STATEMENTS 4. Revenue The following tables provide an analysis of revenue by geographical market and by product line. Geographical market Year ended 30th April, 2025 Year ended 30th April, 2024 Mechanical Refractory Mechanical Refractory Engineering Engineering Total Engineering Engineering Total £’000 £’000 £’000 £’000 £’000 £’000 UK 48,995 14,909 63,904 45,870 15,725 61,595 Rest of Europe 18,668 8,003 26,671 13,460 8,092 21,552 USA 34,902 524 35,426 20,571 909 21,480 Pacific Basin 18,211 24,515 42,726 19,503 23,400 42,903 Rest of World 35,486 15,496 50,982 28,628 15,100 43,728 Total 156,262 63,447 219,709 128,032 63,226 191,258 Product lines Year ended 30th April, 2025 Year ended 30th April, 2024 Mechanical Refractory Mechanical Refractory Engineering Engineering Total Engineering Engineering Total Standard products and £’000 £’000 £’000 £’000 £’000 £’000 14,253 63,447 77,700 consumables 13,833 63,226 77,059 Bespoke products - point in time 21,382 - 21,382 17,380 - 17,380 Point in time revenue 35,635 63,447 99,082 31,213 63,226 94,439 Minimum period contracts 4,701 - 4,701 5,767 - 5,767 Bespoke products - over time 115,926 - 115,926 91,052 - 91,052 Over time revenue 120,627 - 120,627 96,819 - 96,819 Total revenue 156,262 63,447 219,709 128,032 63,226 191,258 The following table presents information about receivables, work in progress, contract assets and liabilities from contracts with customers. 2025 2024 £’000 £’000 Trade receivables due within one year (note 18) ... ... ... ... ... ... 35,931 26,364 Work in progress (note 17) ... ... ... ... ... ... ... ... ... ... 7,174 14,240 Contract assets ... ... ... ... ... ... ... ... ... ... ... 24,310 22,027 Contract liabilities ... ... ... ... ... ... ... ... ... ... ... (34,750) (14,856) Contract liabilities due after more than one year ... ... ... ... ... ... (20,412) (19,268) NOTES TO THE FINANCIAL STATEMENTS 4. Revenue (continued) 2025 2024 £’000 £’000 Revenue recognised in the year, which was included in the contract liability 19,060 balance at the beginning of the period ... ... ... ... ... ... ... ... 13,328 Revenue recognised from performance obligations, which were satisfied 2,598 (or partially satisfied) in previous periods * ... ... ... ... ... ... ... 936 * These figures relate to contract modifications, which are recognised only when there is a high level of certainty. The Group’s revenue is not significantly impacted by seasonal or cyclical events. The potential risk of the loss of any key customer is limited as no single customer accounts for more than 10% of annual revenue (2024: none). Performance obligations A performance obligation is the value of work still to complete on a contract. The aggregate amount of the transaction price allocated to the performance obligations for longer-term contracts, which are unsatisfied (or partially unsatisfied) as at the end of the reporting period is shown below. 2025 2024 £’000 £’000 Performance obligations due to be satisfied within one year ... ... ... ... 69,467 48,932 Performance obligations due to be satisfied between two to three years ... ... 81,818 91,239 Performance obligations due to be satisfied between four to five years ... ... 43,235 20,596 Performance obligations due to be satisfied after more than five years ... ... 6,969 2,743 201,489 163,510 The Group has applied the practical expedient in IFRS 15, paragraph 121, and has not disclosed the remaining performance obligations for contracts which have an original expected duration of one year or less. 5. Expenses and auditor’s remuneration The following are included in profit before taxation: Charged / (credited) to the statement of profit or loss Depreciation: Owned assets ... ... ... ... ... ... ... ... ... ... ... Right-of-use assets ... ... ... ... ... ... ... ... ... ... Amortisation and impairment of intangible assets ... ... ... ... ... ... Loss / (profit) on sale of property, plant and equipment ... ... ... ... ... Research expenditure ... ... ... ... ... ... ... ... ... ... Impairment of trade receivables charged to the statement of profit or loss ... ... ... ... ... ... ... Realised currency (gains) / losses ... ... ... ... ... ... ... ... Unrealised currency losses (gains) ... ... ... ... ... ... ... ... Fair value movement on unhedged currency contracts ... ... ... ... ... Hedge reserve ineffectiveness losses / (gains) ... ... ... ... ... ... Fees receivable by the auditor and the auditor’s associates in respect of: ... ... Audit of these financial statements ... ... ... ... ... ... ... Audit of the financial statements of subsidiaries ... ... ... ... ... Expenses relating to short-term property leases ... ... ... ... ... ... Expenses relating to short-term plant and equipment leases ... ... ... ... Expenses relating to leases of low-value assets ... ... ... ... ... ... Government grants received ... ... ... ... ... ... ... ... ... 2025 2024 £’000 £’000 6,663 6,607 1,346 1,497 1,580 1,341 126 (29) 1,3612,598 159 60 (866) 1,153 1,231(567) 140 2 - (461) 133 88 475 369 338 140 151 197 16 17 - (24) The fair value movement on unhedged currency contracts and ineffectiveness are reported within administrative expenses. 67 NOTES TO THE FINANCIAL STATEMENTS 6. Staff numbers and costs The average number of persons employed by the Group (including Directors) during the year, analysed by category, was as follows: 2025 2024 £’000 £’000 Subsidiary employees ... ... ... ... ... ... ... ... ... ... 1,194 1,169 Goodwin PLC Company employees ... ... ... ... ... ... ... ... 59 56 1,253 1,225 2025 2024 The aggregate payroll costs of these persons were as follows: £’000 £’000 54,975 Wages and salaries ... ... ... ... ... ... ... ... ... ... 52,699 Social security costs ... ... ... ... ... ... ... ... ... ... 5,545 5,037 Other pension costs ... ... ... ... ... ... ... ... ... ... 1,787 1,660 62,307 59,396 2025 2024 Payroll costs are reported as follows: £’000 £’000 29,180 Cost of sales ... ... ... ... ... ... ... ... ... ... 27,211 Selling and distribution costs ... ... ... ... ... ... ... ... 5,369 4,434 Administrative expenses ... ... ... ... ... ... ... ... ... 27,758 27,751 62,307 59,396 Details of the Directors’ remuneration can be found within the Directors’ Remuneration Report on pages 36 to 38. The emoluments of the highest paid Director were £451,000 (2024: £435,000). On 30th April, 2025, one Director was a member of a defined benefit contribution pension scheme (2024: one). 68 NOTES TO THE FINANCIAL STATEMENTS 7. Finance income and costs 2025 2024 £’000 £’000 Income from interest rate swap ... ... ... ... ... ... ... ... ... 1,210 1,269 Other interest income ... ... ... ... ... ... ... ... ... ... 95 145 Finance income... ... ... ... ... ... ... ... ... ... ... 1,305 1,414 Interest expense on lease liabilities ... ... ... ... ... ... ... ... 502 693 Interest expense on bank loans and overdrafts ... ... ... ... ... ... 3,321 4,310 Capitalised interest on assets in the course of construction ... ... ... ... (858) (719) Finance costs ... ... ... ... ... ... ... ... ... ... 2,965 4,284 Finance costs (net) ... ... ... ... ... ... ... ... ... ... 1,660 2,870 The average interest rate used to calculate capitalised interest was 5.02% (2024: 5.02%). This takes into account the benefit of the interest rate swap. 8. Taxation Recognised in profit or loss 2025 2024 Current tax expense £’000 £’000 Current year ... ... ... ... ... ... ... ... ... ... ... 6,880 3,207 Under provision in prior years ... ... ... ... ... ... ... ... 188 70 7,068 3,277 Deferred tax expense Origination and reversal of temporary differences 1,376 – current year (see below) ... ... ... ... ... ... ... ... 3,460 Origination and reversal of temporary differences (362) – (over) / under-provision in prior years ... ... ... ... ... ... ... (246) 1,014 3,214 Total tax expense ... ... ... ... ... ... ... ... ... ... 8,082 6,491 UK corporation tax The tax charge on the face of the profit or loss is the aggregated total of the tax applicable to the profits of each Group company calculated at its country tax rate. The UK taxation system has provisions within it that allow for 100%, and in previous recent tax years, up to 130% first year capital allowances on certain assets purchased during the year. Due to the high capital expenditure within the UK element of the Group over the last few years, the Group has been able to utilise these first year allowances and the Super Deduction tax scheme within the UK Group taxation computations. This has resulted in a lower amount of taxation actually being paid in the UK for both financial year 2025 and financial year 2024 and a significant deferred tax charge of 13% of the calculated tax, which will not be paid until sometime in the future. Origination and reversal of temporary differences – current year The majority of the deferred tax expense shown above comes from the difference between the accounting treatment and the tax treatment of plant and equipment expenditure. Under the current UK tax regime, most of the plant and equipment expenditure is 100% offset against the profits in the year of expenditure and so produces a very low amount of taxation payable. In future years, the tax benefit, gained from these first year allowances, reverses over time as future profits are taxed without further offset from this historical capital expenditure. 69 NOTES TO THE FINANCIAL STATEMENTS 8. Taxation (continued) Reconciliation of effective tax rate 2025 2024 £’000 £’000 Profit before taxation ... ... ... ... ... ... ... ... ... ... 34,260 24,207 Tax using the UK corporation tax rate of 25.00% (2024: 25.00%) ... ... ... ... 8,565 6,052 Tax effect of non-deductible / (taxable) amounts in calculating taxable income: (291) Non-taxable income ... ... ... ... ... ... ... ... ... ... ... (11) Non-deductible expenses ... ... ... ... ... ... ... ... ... ... 436 325 Other permanent timing differences ... ... ... ... ... ... ... ... (107) (14) Over provision in prior years ... ... ... ... ... ... ... ... ... (174) (176) Losses not recognised ... ... ... ... ... ... ... ... ... ... ... 18 163 Losses utilised where a deferred tax asset was not recognised ... ... ... ... (670) - Withholding tax unrelieved ... ... ... ... ... ... ... ... ... ... 755 389 Difference in overseas tax rates ... ... ... ... ... ... ... ... ... (439) (227) Effect of equity accounting for associate ... ... ... ... ... ... ... ... (11) (10) Total tax expense ... ... ... ... ... ... ... ... ... ... 8,082 6,491 Where subsidiary companies have incurred losses in the year, which are unlikely to be relieved against future profits in the foreseeable future, deferred tax assets are not recognised. Withholding tax unrelieved represents withholding tax deducted on dividends and royalties from overseas subsidiaries and associates. Recognised in other comprehensive income 2025 2024 £’000 £’000 Deferred tax charge on the cash flow hedge and cost of hedging reserve ... ... (839) (99) 9. Earnings per share Number of ordinary shares Ordinary shares in issue 2025 2024 7,509,600 Opening shares in issue ... ... ... ... ... ... ... ... ... ... 7,689,600 Shares bought back in the year (note 25) ... ... ... ... ... ... ... ... - (180,000) Total ordinary shares ... ... ... ... ... ... ... ... ... ... 7,509,600 7,509,600 Weighted average number of ordinary shares in issue ... ... ... ... ... 7,509,600 7,527,797 2025 2024 £’000 £’000 Relevant post-tax profits attributable to ordinary shareholders ... ... ... ... 24,569 16,902 2025 2024 pence pence Basic and diluted earnings per share ... ... ... ... ... ... ... ... 327.17 224.53 10. Dividends 2025 2024 £’000 £’000 Paid ordinary dividends during the year in respect of prior years 9,988 133p (2024: 115p) per qualifying ordinary share ... ... ... ... ... ... 8,636 After the balance sheet date an ordinary dividend of 280 pence per qualifying ordinary share was proposed by the Directors (2024: Ordinary dividend of 133 pence). The proposed current year ordinary dividend of £21,027,000 (2024: Proposed ordinary dividend of £9,988,000) has not been recognised as a liability within these financial statements. 70 NOTES TO THE FINANCIAL STATEMENTS 11. Property, plant and equipment Assets in Other course of Land and Plant and equipment construct- buildings machinery son Total Cost £’000 £’000 £’000 £’000 £’000 59,953 94,849 6,472 19,632 180,906 Balance at 1st May, 2024 ... ... ... Additions ... ... ... ... ... 2,528 1,510 442 10,530 15,010 Reclassification ... ... ... ... 1,098 2,699 - (3,797) - Transfer from ROU ... ... ... - 4,359 2,021 - 6,380 Disposals ... ... ... ... ... (85) (741) (256) (26) (1,108) Exchange adjustment ... ... ... (906) (478) (119) (20) (1,523) Balance at 30th April, 2025 ... 62,588 102,198 8,560 26,319 199,665 Depreciation 13,287 57,277 5,005 - 75,569 Balance at 1st May, 2024 ... ... ... Charged in year ... ... ... ... 1,808 4,481 374 - 6,663 Transfer from ROU ... ... ... - 321 1,609 - 1,930 Disposals ... ... ... ... ... (4) (639) (224) - (867) Exchange adjustment ... ... ... (183) (191) (88) - (462) Balance at 30th April, 2025 ... 14,908 61,249 6,676 - 82,833 Net book value As at 1st May, 2024 ... ... ... 46,666 37,572 1,467 19,632 105,337 As at 30th April, 2025 ... ... 47,680 40,949 1,884 26,319 116,832 Cost Balance at 1st May, 2023 ... ... ... 52,376 89,798 6,576 22,637 171,387 Additions ... ... ... ... ... 3,476 2,884 489 9,572 16,421 Reclassification - others ... ... ... 4,881 7,511 - (12,392) - Transfer to ROU ... ... ... - (4,723) - - (4,723) Disposals ... ... ... ... ... (382) (400) (498) (110) (1,390) Exchange adjustment ... ... ... (398) (221) (95) (75) (789) Balance at 30th April, 2024 ... 59,953 94,849 6,472 19,632 180,906 Depreciation Balance at 1st May, 2023 ... ... ... 12,062 53,077 5,005 - 70,144 Charged in year ... ... ... ... 1,605 4,468 534 - 6,607 Transfer to ROU ... ... ... - 80 - - 80 Disposals ... ... ... ... ... (258) (304) (465) - (1,027) Exchange adjustment ... ... ... (122) (44) (69) - (235) Balance at 30th April, 2024 ... 13,287 57,277 5,005 - 75,569 Net book value As at 30th April, 2024 ... ... 46,666 37,572 1,467 19,632 105,337 * Assets are transferred from the right-of-use assets category on the settlement of a lease purchase agreement and payment of the option to purchase fee. Additions During the year the Group expended £15 million on property, plant and equipment. The major items purchased during the year were the continued investment in the plant for Duvelco, completion of the India Refractory building, construction of a building in Germany, purchase of pressing equipment for polyimide in Germany and purchase of land for Goodwin Steel Castings. Other equipment Other equipment comprises motor vehicles, IT hardware and office equipment. Assets in course of construction 2025 2024 £’000 £’000 Land and buildings ... ... ... ... ... ... ... ... ... ... ... 4,970 2,757 Plant and machinery ... ... ... ... ... ... ... ... ... ... ... 21,349 16,875 71 26,319 19,632 NOTES TO THE FINANCIAL STATEMENTS 11. Property, plant and equipment (continued) Depreciation Depreciation is reported as follows: Cost of sales ... ... ... ... ... ... ... ... ... ... ... Administrative expenses ... ... ... ... ... ... ... ... ... ... Security The net book value of assets pledged as security for borrowings (note 20) is: Land and buildings ... ... ... ... ... ... ... ... ... ... ... Plant and machinery ... ... ... ... ... ... ... ... ... ... ... 12. Right-of-use assets 2025 2024 £’000 £’000 6,453 6,383 210 224 6,663 6,607 2025 2024 £’000 £’000 1,432 7,271 4,086 4,537 5,518 11,808 Land and Plant and Other buildings machinery equipment Total Cost £’000 £’000 £’000 £’000 2,934 10,312 2,004 15,250 Balance at 1st May, 2024 ... ... ... Additions ... ... ... ... ... 77 15 55 147 Transfer to property, plant and equipment - (4,359) (2,021) (6,380) Disposals ... ... ... ... ... (149) - (41) (190) Exchange adjustment ... ... ... (95) - 3 (92) Balance at 30th April, 2025 ... 2,767 5,968 - 8,735 Depreciation 1,059 1,119 1,328 3,506 Balance at 1st May, 2024 ... ... ... Charged in year ... ... ... ... 448 587 311 1,346 Transfer to property, plant and equipment - (321) (1,609) (1,930) Disposals ... ... ... ... ... (149) - (31) (180) Exchange adjustment ... ... ... (63) - 1 (62) Balance at 30th April, 2025 ... 1,295 1,385 - 2,680 Net book value As at 1st May, 2024 ... ... ... 1,875 9,193 676 11,744 As at 30th April, 2025 ... ... 1,472 4,583 - 6,055 Cost Balance at 1st May, 2023 ... ... ... 2,646 5,452 1,829 9,927 Additions ... ... ... ... ... 1,418 150 180 1,748 Transfer from property, plant and equipment - 4,723 - 4,723 Disposals ... ... ... ... ... (1,078) - - (1,078) Exchange adjustment ... ... ... (52) (13) (5) (70) Balance at 30th April, 2024 ... 2,934 10,312 2,004 15,250 Depreciation Balance at 1st May, 2023 ... ... ... 1,511 748 905 3,164 Charged in year ... ... ... ... 615 457 425 1,497 Transfer from property, plant and equipment - (80) - (80) Disposals ... ... ... ... ... (1,035) - - (1,035) Exchange adjustment ... ... ... (32) (6) (2) (40) Balance at 30th April, 2024 ... 1,059 1,119 1,328 3,506 Net book value As at 30th April, 2024 ... ... 1,875 9,193 676 11,744 72 NOTES TO THE FINANCIAL STATEMENTS 12. Right-of-use assets (continued) Depreciation 2025 2024 Depreciation is reported as follows: £’000 £’000 Cost of sales ... ... ... ... ... ... ... ... ... ... ... 780 882 Administrative expenses ... ... ... ... ... ... ... ... ... ... 566 615 1,346 1,497 13. Investments in subsidiaries The Group has the following principal subsidiaries. Non-principal subsidiaries are listed in note 32: Company name Registered Country of Class of Subsidiaries: address Incorporation shares held % held Mechanical Engineering: 100.0 Goodwin Steel Castings Limited ... ... ... 1 England and Wales Ordinary Goodwin International Limited ... ... ... 1 England and Wales Ordinary 100.0 Easat Radar Systems Limited ... ... ... 1 England and Wales Ordinary 77.0 Easat Radar Systems Limited ... ... ... 1 England and Wales Preference 100.0 Goodwin Korea Company Limited ... ... ... 3 South Korea Ordinary 95.0 Goodwin Pumps India Private Limited... ... 4 India Ordinary 100.0 Goodwin Shanghai Company Limited ... ... 5 China Ordinary 100.0 Noreva GmbH ... ... ... ... ... ... 6 Germany Ordinary 100.0 Goodwin Indústria e Comércio de Bombas 100.0 Submersas Ltda ... ... ... ... ... 7 Brazil Ordinary Internet Central Limited ... ... ... ... 1 England and Wales Ordinary 100.0 Goodwin Submersible Pumps Australia Pty. Limited 8 Australia Ordinary 100.0 Metal Proving Services Limited ... ... ... 1 England and Wales Ordinary 100.0 Easat Finland Oy (previous name NRPL Oy) ... 9 Finland Ordinary 77.0 Goodwin Submersible Pumps Africa Pty. Limited 14 South Africa Ordinary 100.0 Duvelco Limited ... ... ... ... ... 1 England and Wales Ordinary 100.0 Refractory Engineering: 100.0 Goodwin Refractory Services Limited ... ... 1 England and Wales Ordinary Dupré Minerals Limited ... ... ... ... 1 England and Wales Ordinary 100.0 Hoben International Limited ... ... ... 2 England and Wales Ordinary 100.0 Goodwin Refractory Services India Private Limited 4 India Ordinary 100.0 Siam Casting Powders Limited ... ... ... 10 Thailand Ordinary 61.5 Ultratec Jewelry Supplies Limited ... ... ... 11 China Ordinary 75.5 SRS (Qingdao) Casting Materials Company Limited 12 China Ordinary 75.5 Jewelry Plaster Limited ... ... ... ... 13 Thailand Ordinary 61.5 The registered address for each company can be found in note 34. During the year, Easat Radar Systems India Private Limited was merged with Goodwin Pumps India Private Limited. All of the above companies are included as part of the consolidated accounts. All the companies are involved in mechanical or refractory engineering, with the exception of Internet Central Limited, which is an internet service provider. Non-controlling interests (NCI) The following subsidiaries each have non-controlling interests: Company name Registered Country of Class of % held Subsidiaries: address Incorporation shares held by NCI Mechanical Engineering: 23.0 Easat Radar Systems Limited ... ... ... 1 England and Wales Ordinary Goodwin Korea Company Limited ... ... ... 3 South Korea Ordinary 5.0 Easat Finland Oy ... ... ... ... ... 9 Finland Ordinary 23.0 Refractory Engineering: 38.5 Goodwin Refractory Services (Thailand) Limited 10 Thailand Ordinary Jewelry Plaster Limited ... ... ... ... 13 Thailand Ordinary 38.5 Jewelry Wax Limited ... ... ... ... 13 Thailand Ordinary 38.5 Siam Casting Powders Limited ... ... ... 10 Thailand Ordinary 38.5 GRS Silicone Company Limited ... ... ... 16 China Ordinary 24.5 SRS (Qingdao) Casting Materials Company Limited 12 China Ordinary 24.5 Shenzhen King-Top Modern Hi-Tech Company Limited 15 China Ordinary 24.5 Ultratec Jewelry Supplies Limited ... ... ... 11 China Ordinary 24.5 Ying Tai (U.K.) Limited ... ... ... ... 1 England and Wales Ordinary 24.5 The registered address for each company can be found in note 34. 73 NOTES TO THE FINANCIAL STATEMENTS 13. Investments in subsidiaries (continued) Non-controlling interests (NCI) (continued) The Board considers a material company to be one that has either 10% of the EBITDA (earnings before interest, tax, depreciation and amortisation) or 10% of the net assets of the Group. As such, the Board does not consider any of its subsidiary companies, which have non-controlling interests, to be material. The financial information on all subsidiaries with non-controlling interests has been aggregated, analysing the data by segment, as the entities in each segment have similar characteristics and risk profiles, to provide additional information on these companies. Non-controlling interests (NCI) - movements in reserves by segment Year ended 30th April, 2025 Year ended 30th April, 2024 Mechanical Refractory Total Mechanical Refractory Total Engineering Engineering Engineering Engineering Profit / (loss) allocated £’000 £’000 £’000 £’000 £’000 £’000 320 1,289 1,609 to NCI (226) 1,040 814 Dividends paid to NCI - (1,973) (1,973) - (473) (473) Accumulated reserves (766) 4,811 4,045 (1,168) 5,537 4,369 held by NCI Non-controlling interests (NCI) - summarised financial information The below represents the amounts in the financial statements of the subsidiaries with non-controlling interests (NCI), before any intercompany eliminations, and does not reflect the Group’s share of those amounts. Year ended 30th April, 2025 Year ended 30th April, 2024 Mechanical Refractory Total Mechanical Refractory Total Engineering Engineering Engineering Engineering Non-current assets £’000 £’000 £’000 £’000 £’000 £’000 2,630 10,337 12,967 5,000 11,083 16,083 Current assets 20,185 15,913 36,098 8,026 16,790 24,816 Current liabilities (20,390) (6,442) (26,832) (4,531) (5,889) (10,420) Non-current liabilities (861) (97) (958) (8,416) (183) (8,599) Total net assets 1,564 19,711 21,275 79 21,801 21,880 Revenue 21,204 28,497 49,701 10,160 25,129 35,289 Profit / (loss) for the year 1,177 4,258 5,435 (1,062) 3,327 2,265 excluding dividend income Total comprehensive 869 9,622 10,491 (1,175) 4,429 3,254 income Net cash flow from 539 10,718 11,257 (3,684) 4,337 653 operating activities Net cash flow from (402) (153) (555) (319) (846) (1,165) investing activities Net cash flow from (14) (11,440) (11,454) 4,014 (2,052) 1,962 financing activities 14. Investment in associate The Group’s share of profit after tax in its immaterial associate for the year ended 30th April, 2025 was £65,000 (2024: £69,000). Summary financial information of the Group’s share of its associate company is as follows: 2025 2024 £’000 £’000 Balance at 1st May ... ... ... ... ... ... ... ... ... ... ... 828 964 Profit before tax ... ... ... ... ... ... ... ... ... ... ... 76 79 Tax ... ... ... ... ... ... ... ... ... ... ... (11) (10) Dividends ... ... ... ... ... ... ... ... ... ... ... (156) (131) Exchange adjustment ... ... ... ... ... ... ... ... ... ... 38 (74) ... ... ... ... ... ... ... ... ... ... Balance at 30th April 775 828 Assets ... ... ... ... ... ... ... ... ... ... ... 794 844 Liabilities ... ... ... ... ... ... ... ... ... ... ... (19) (16) 775 828 74 NOTES TO THE FINANCIAL STATEMENTS 15. Intangible assets Brand names and Manufact-SoftwareDevelop- intellectual uring and ment Goodwill property rights licences costs Total Cost £’000 £’000 £’000 £’000 £’000 £’000 9,888 10,157 4,919 1,929 13,981 40,874 Balance at 1st May, 2024 ... Additions ... ... ... - - - 283 2,832 3,115 Disposals ... ... ... - - - (212) (280) (492) Exchange adjustment ... 200 31 20 (19) 1 233 Balance at 30th April, 2025 10,088 10,188 4,939 1,981 16,534 43,730 Amortisation and impairment 339 7,400 2,897 1,306 3,032 14,974 Balance at 1st May, 2024 ... Amortisation for the year - 295 296 351 638 1,580 Disposals ... ... ... - - - (212) (280) (492) Exchange adjustment ... - 8 - (16) 6 (2) Balance at 30th April, 2025 339 7,703 3,193 1,429 3,396 16,060 Net book value As at 1st May, 2024 ... 9,549 2,757 2,022 623 10,949 25,900 As at 30th April, 2025 9,749 2,485 1,746 552 13,138 27,670 Cost Balance at 1st May, 2023 ... 10,071 10,190 4,955 1,444 12,522 39,182 Additions ... ... ... - 28 - 553 1,456 2,037 Disposals ... ... ... - - (17) (48) - (65) Exchange adjustment ... (183) (61) (19) (20) 3 (280) Balance at 30th April, 2024 9,888 10,157 4,919 1,929 13,981 40,874 Amortisation and impairment Balance at 1st May, 2023 ... 339 7,114 2,610 1,231 2,440 13,734 Amortisation for the year - 304 306 139 592 1,341 Disposals ... ... ... - - (17) (48) - (65) Exchange adjustment ... - (18) (2) (16) - (36) Balance at 30th April, 2024 339 7,400 2,897 1,306 3,032 14,974 Net book value As at 30th April, 2024 9,549 2,757 2,022 623 10,949 25,900 Customer lists are included within brand names and intellectual property or within manufacturing rights, depending on the nature of the acquisition; non-compete agreements are disclosed within manufacturing rights. During the year, the Group added to its portfolio of intangible assets. Amortisation and impairment charges are reported in cost of sales in the statement of profit or loss. Impairment testing for cash-generating units containing intangible assets The Group tests intangible assets annually for impairment or more frequently if there are indications that an intangible asset might be impaired. For the purpose of impairment testing, an intangible asset is allocated to the relevant subsidiary (cash generating unit (“CGU”)), which is the lowest level within the Group at which the intangible asset is monitored for internal management purposes. 75 NOTES TO THE FINANCIAL STATEMENTS 15. Intangible assets (continued) Impairment testing for cash-generating units containing intangible assets (continued) 2025 2024 Other Other intangible intangible Property assets Property assets plant and (excluding plant and (excluding equipment Goodwill software) Total equipment Goodwill software) Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 Mechanical Engineering Duvelco 19,004 - 4,350 23,354 15,902 - 2,578 18,480 Noreva 7,931 4,661 - 12,592 4,642 4,490 - 9,132 Easat Group 273 1,214 3,464 4,951 341 1,193 3,125 4,659 Other - - 2,766 2,766 - - 2,952 2,952 Refractory Engineering Goodwin Refractory 3,217 3,346 - 6,563 Services Holdings Ltd 3,429 3,346 - 6,775 Perlite and - - 1,334 1,334 vermiculite 710 - 1,568 2,278 Castaldo - - 2,035 2,035 154 - 2,144 2,298 Other - 528 3,420 3,948 - 520 3,361 3,881 Total 30,425 9,749 17,369 57,543 25,178 9,549 15,728 50,455 An impairment test is a comparison of the carrying value of the assets of a CGU to their recoverable amount, based on a value-in-use calculation. The recoverable amount is the greater of value-in-use and fair value less costs of disposal. Where the recoverable amount is less than the carrying value, an impairment results. During the year, each CGU containing an intangible asset was separately assessed and tested for impairment. As part of testing intangible assets for impairment, detailed forecasts of operating cash flows for the next five years are used, which are based on budgets and plans approved by the Board. The forecasts represent the best estimate of future performance of the CGU, based on past performance and expectations for the market development of the CGU. A number of key assumptions are used as part of impairment testing. These key assumptions, such as the CGU’s position within its relevant market; its ability to generate profitable orders within that market; expected growth rates both in the market and geographically, are made by management, who also take into account past experience and knowledge of forecast future performance, together with other relevant external sources of information. The projections use various growth rates, such as increases in revenue and / or increases in gross margin, whichever is relevant to that CGU, consistent with the profit forecasts of the CGU for the next five years. The growth rates are identified by experienced managers within that CGU, who have significant experience and knowledge of that CGU and its market place. In the current and previous financial year, the terminal values are calculated from the fifth year’s forecasts, assuming a zero growth rate from that point, in line with the conservative approach of the Group. The forecasts are then discounted at an appropriate pre-tax weighted average cost of capital rate considering the perceived levels of risk for that CGU. Further sensitivity tests are then performed reducing the discounted cash flows by 10%, which the Group sees as being an appropriate reduction due to the prudent forecasts that it has already used within the testing, and also increasing the discount rate by a range of up to 10%, to confirm there is no need to consider further a need for impairment. The table below shows the range of rates used in the impairment testing. 2025 2024 Mechanical Engineering % % 0-10 Growth rates ... ... ... ... ... ... ... ... ... ... ... 0-10 Pre-tax weighted average cost of capital ... ... ... ... ... ... ... 10-11 10-11 Refractory Engineering 3-13 Growth rates ... ... ... ... ... ... ... ... ... ... ... 0-7 Pre-tax weighted average cost of capital ... ... ... ... ... ... ... 9-10 10-11 Strategic investments in new and high growth CGUs are excluded from the growth rates above as the percentage growth from nil is not meaningful. This predominantly relates to Duvelco, in which the Group has invested circa £23 million, for new products where the Group is forecasting the revenues to increase significantly. The growth being forecasted for this CGU is significantly higher than for the other more established CGUs, whereby including them in the table would distort the growth forecast reported for the established CGUs. This growth expectation is described as a key judgement in note 2. We have reviewed the forecasted revenues of these sensitive CGUs and then stressed the revenues by reducing them to less than 50% of the expected forecasted revenues and can confirm that, at these dramatically reduced revenue levels, none of the three intangible assets would need to be impaired. 76 NOTES TO THE FINANCIAL STATEMENTS 15. Intangible assets (continued) Impairment testing for cash-generating units containing intangible assets (continued) The estimates and assumptions made in connection with the impairment testing could differ from future actual results of operations and cash flows. A reasonably likely variation in the assumptions, as disclosed, would not give rise to an impairment. However, future events could cause the Group to conclude that impairment indicators exist and that the asset values associated with a given operation have become impaired. Duvelco The Company has invested circa £23 million in the area of high-performance Polyimide resins. The company, during the financial year, commenced the testing and commissioning of the facility and started producing material, which will be used by targeted customers to perform their acceptance trials of the material. The first commercial sales are expected to occur by the end of the year, once acceptance trials have concluded. The judgement of the Board is that the market potential here is significant and that future profitability is expected to be strong. Accordingly, the Directors’ do not see a need to impair our investment in this area. 16. Derivative financial assets 2025 2024 Due within one year Note £’000 £’000 Interest rate swap ... ... ... ... ... ... ... ... ... ... 875 1,228 Derivative assets designated as cash flow hedging instruments ... ... 2,838 743 Derivative assets not designated as cash flow hedging instruments ... 744 36 4,457 2,007 Due after more than one year Interest rate swap ... ... ... ... ... ... ... ... ... ... 3,913 4,814 Derivative assets designated as cash flow hedging instruments ... ... 2,148 902 6,061 5,716 Total Interest rate swap ... ... ... ... ... ... ... ... ... ... 4,788 6,042 Derivative assets designated as cash flow hedging instruments ... ... 4,986 1,645 Derivative assets not designated in a cash flow relationship ... ... ... 744 36 27(d) 10,518 7,723 2025 2024 Maturity date - interest rate swap ... ... ... ... ... ... ... August 2031 August 2031 May 2025 May 2024 Maturity date - derivative assets ... ... ... ... ... ... ... December 2029 April 2027 17. Inventories 2025 2024 Net balances £’000 £’000 Raw materials and consumables ... ... ... ... ... ... ... ... 20,750 21,840 Work in progress ... ... ... ... ... ... ... ... ... ... ... 7,174 14,240 Finished goods ... ... ... ... ... ... ... ... ... ... ... 11,172 10,729 39,096 46,809 Provisions held Raw materials and consumables ... ... ... ... ... ... ... ... (701) (533) Work in progress ... ... ... ... ... ... ... ... ... ... ... (1,979) (1,320) Finished goods ... ... ... ... ... ... ... ... ... ... ... (420) (555) (3,100) (2,408) Inventory impairment charge ... ... ... ... ... ... ... ... 1,647 881 Release of inventory impairment ... ... ... ... ... ... ... ... 128 - 77 NOTES TO THE FINANCIAL STATEMENTS 18. Trade and other receivables Balances due within one year 2025 2024 £’000 £’000 Trade receivables ... ... ... ... ... ... ... ... ... ... ... 35,931 26,364 Other financial assets ... ... ... ... ... ... ... ... ... ... 1,816 1,443 Advance payments to suppliers ... ... ... ... ... ... ... ... ... 1,228 423 Prepayments and other non-financial assets ... ... ... ... ... ... 2,917 3,473 Deferred tax asset (see note 24) ... ... ... ... ... ... ... ... ... 498 191 42,390 31,894 Financial assets ... ... ... ... ... ... ... ... ... ... ... 37,747 27,807 Non-financial assets ... ... ... ... ... ... ... ... ... ... ... 4,643 4,087 42,390 31,894 19. Cash and cash equivalents 2025 2024 £’000 £’000 Cash in hand ... ... ... ... ... ... ... ... ... ... ... 58 72 Bank balances ... ... ... ... ... ... ... ... ... ... ... 16,585 30,606 16,643 30,678 20. Borrowings Information is provided below about the contractual terms of the Group’s lease liabilities, bank loans and borrowings. The bank loans repayable by instalment are secured against a property in Germany together with furnaces in the UK (see note 11). For more information about the Group’s exposure to interest rate and foreign currency risk, see note 27. Year ended 30th April, 2025 Year ended 30th April, 2024 Non-current Current Total Non-current Current Total liabilities liabilities liabilities liabilities liabilities liabilities £’000 £’000 £’000 £’000 £’000 £’000 Bank overdrafts ... - - - - 48 48 Bank loans - repayable 1,303 893 2,196 by instalments ... 5,966 1,106 7,072 Bank loans - revolving 12,000 14,000 26,000 49,000 10,000 59,000 Lease liabilities ... 2,404 1,527 3,931 6,940 2,873 9,813 15,707 16,420 32,127 61,906 14,027 75,933 The current revolving loan facility, included in current liabilities has been re-financed after the year-end. 78 NOTES TO THE FINANCIAL STATEMENTS 20. Borrowings (continued) Reconciliation of liabilities arising from financing activities Bank overdrafts Bank loans - used for cash repayable by Bank loans - Lease management instalments revolving liabilities Total Opening balance at £’000 £’000 £’000 £’000 £’000 48 7,072 59,000 9,813 75,933 1st May, 2024 ... ... Cash flows: Proceeds from new loans - - 12,000 - 12,000 Repayment of borrowings - (4,837) (45,000) (6,073) (55,910) Change in bank overdrafts (48) - - - (48) Non-cash movements: New leases - - - 205 205 Interest charge - (13) - - (13) Foreign exchange - (26) - (14) (40) movement Closing balance - 2,196 26,000 3,931 32,127 30th April, 2025 Opening balance at 1st May, 2023 ... ... 119 8,139 39,500 6,227 53,985 Cash flows: Proceeds from new loans - 98 23,000 - 23,098 Repayment of borrowings - (1,152) - (2,910) (4,062) Change in bank overdrafts (71) - - - (71) Non-cash movements Conversion of loan to lease - - (3,500) 3,500 - New leases - - - 3,040 3,040 Foreign exchange movement ... ... - (13) - (44) (57) Closing balance 48 7,072 59,000 9,813 75,933 30th April, 2024 79 NOTES TO THE FINANCIAL STATEMENTS 20. Borrowings (continued) Contractual undiscounted cash flows Year ended 30th April, 2025 Year ended 30th April, 2024 Minimum Minimum loan Interest Principal loan Interest Principal payments payments Bank loans - repayable £’000 £’000 £’000 £’000 £’000 £’000 by instalments 942 49 893 Within one year ... 1,471 365 1,106 Within two to ... ... 598 36 562 2,427 592 1,835 three years Within four to ... ... 164 26 138 1,072 484 588 five years After more than five years 654 51 603 4,968 1,425 3,543 Lease liabilities 2,358 162 2,196 9,938 2,866 7,072 1,690 163 1,527 Within one year ... 3,430 557 2,873 Within two to ... ... 1,768 121 1,647 5,296 572 4,724 three years Within four to ... ... 423 44 379 1,777 111 1,666 five years After more than five years 407 29 378 598 48 550 4,288 357 3,931 11,101 1,288 9,813 21. Trade and other payables 2025 2024 £’000 £’000 Trade payables ... ... ... ... ... ... ... ... ... ... ... 21,303 20,432 Other financial liabilities ... ... ... ... ... ... ... ... ... ... 1,257 2,144 Other taxation and social security ... ... ... ... ... ... ... ... 2,850 3,092 Accrued expenses ... ... ... ... ... ... ... ... ... ... ... 11,391 4,904 Advance payments from customers ... ... ... ... ... ... ... ... 358 258 37,159 30,830 Financial liabilities ... ... ... ... ... ... ... ... ... ... ... 36,801 30,572 Non-financial liabilities ... ... ... ... ... ... ... ... ... ... 358 258 37,159 30,830 22. Derivative financial liabilities 2025 2024 Due within one year Note £’000 £’000 Derivative liabilities designated as cash flow hedging instruments ... 201 247 Derivative liabilities not designated as cash flow hedging instruments ... 55 4 256 251 Due after more than one year 428 Derivative liabilities designated as cash flow hedging instruments ... 277 428 277 Total Derivative liabilities designated as cash flow hedging instruments ... 629 524 Derivative liabilities not designated as cash flow hedging instruments ... 55 4 27 (d) 684 528 2025 2024 May 2025 - May 2024 - Maturity dates ... ... ... ... ... ... ... ... ... ... October 2029 April 2029 80 NOTES TO THE FINANCIAL STATEMENTS 23. Provisions 2025 2024 £’000 £’000 Balance at 1st May ... ... ... ... ... ... ... ... ... ... 505 512 Increase in provision... ... ... ... ... ... ... ... ... ... ... 206 172 Release of provision ... ... ... ... ... ... ... ... ... ... ... (211) (164) Provision utilised (7) - Exchange adjustment ... ... ... ... ... ... ... ... ... ... (1) (15) Balance at 30th April... ... ... ... ... ... ... ... ... ... 492 505 Warranty due within one year ... ... ... ... ... ... ... ... ... 223 231 Warranty due after one year ... ... ... ... ... ... ... ... ... 269 274 Balance at 30th April... ... ... ... ... ... ... ... ... ... 492 505 Provisions include 1-3 year warranties for products sold. 24. Deferred tax assets and liabilities Deferred tax balances are attributable to the following: Year ended 30th April, 2025 Year ended 30th April, 2024 Assets Liabilities Net Assets Liabilities Net Property, plant and £’000 £’000 £’000 £’000 £’000 £’000 47 (13,496) (13,449) equipment ... ... 67 (12,738) (12,671) Intangible assets ... - (2,179) (2,179) - (2,043) (2,043) Derivative financial - (1,307) (1,307) instruments ... ... 34 (329) (295) Tax losses ... ... 393 - 393 23 - 23 Other temporary 655 (563) 92 differences ... ... 688 (310) 378 1,095 (17,545) (16,450) 812 (15,420) (14,608) Deferred tax balances are reported in the balance sheet as follows: 2025 2024 £’000 £’000 Deferred tax asset (see note 18) ... ... ... ... ... ... ... ... 498 191 Deferred tax liability ... ... ... ... ... ... ... ... ... ... ... (16,948) (14,799) (16,450) (14,608) 81 NOTES TO THE FINANCIAL STATEMENTS 24.Deferred tax assets and liabilities (continued) Property Derivative Other plant and Intangible financial Tax temporary equipment assets instruments losses differences Total Balance at £’000 £’000 £’000 £’000 £’000 £’000 (12,671) (2,043) (295) 23 378 (14,608) 1st May, 2024 Recognised in: - Profit and loss (800) (136) (174) 371 (275) (1,014) - Other comprehensive - - (839) - - (839) income Exchange adjustment 22 - 1 (1) (11) 11 Balance at (13,449) (2,179) (1,307) 393 92 (16,450) 30th April, 2025 Balance at 1st May, 2023 (10,092) (2,021) (79) 350 536 (11,306) Recognised in: - Profit and loss (2,584) (22) (117) (327) (164) (3,214) - Other comprehensive income - - (99) - - (99) Exchange adjustment 5 - - - 6 11 Balance at (12,671) (2,043) (295) 23 378 (14,608) 30th April, 2024 Deferred tax assets not recognised on losses 2025 2024 £’000 £’000 Gross tax losses ... ... ... ... ... ... ... ... ... ... ... 716 3,062 Deferred tax assets not recognised ... ... ... ... ... ... ... ... 73 681 The Group has not recognised a deferred tax asset against taxable losses incurred by some of its subsidiaries. Typically, these are subsidiaries, which are still in their formative years and, whilst profitability and the associated recoverability of tax losses is expected in the long-term, it is deemed prudent to not recognise a deferred tax asset at this stage, as a result of the uncertainty. 25.Capital and reserves Share capital 2025 2024 Authorised, allotted, called up and fully paid: £’000 £’000 751 As 1st May 7,509,600 (2024: £7,689,600) ordinary shares of 10p each ... ... 769 Buy back of nil (2024: 180,000) ordinary shares of 10p each ... ... ... - (18) At 30th April 7,509,600 (2024: 7,509,600) ordinary shares of 10p each ... ... 751 751 The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company. The Company announced on 5th May, 2023 that it was proceeding with a Tender offer to tender up to 180,000 of its ordinary shares at the tender price of £48 per ordinary share. The tender offer was subsequently approved at a General Meeting that was held on 30th May, 2023 and the following day the offer ended. The offer was oversubscribed by 229% and, of the total number of Ordinary Shares validly tendered, all 180,000 Ordinary Shares have been purchased by the Company, and on 7th June, 2023 were cancelled off the register. The total cost of Ordinary Shares purchased was £8.87 million. Translation reserve The translation reserve comprises all foreign exchange differences arising from the translation of the financial statements of foreign operations. 82 NOTES TO THE FINANCIAL STATEMENTS 25.Capital and reserves (continued) Share-based payment reserve The share-based payments reserve is a non-cash-impacting provision, as required by IFRS 2, relating to the Equity Long-Term Incentive Plan (LTIP), which vested at 1st May, 2019. As all share options have now been exercised and the Company has no follow-on LTIP incentive plans in place or proposed, the balance on the reserve was transferred to retained earnings in the previous year. Cash flow hedge reserve and cost of hedging reserve 2025 2024 Note £’000 £’000 Derivative assets designated as cash flow hedging instruments ... ... 16 4,986 1,645 Derivative liabilities designated as cash flow hedging instruments ... ... 22 (629) (524) Derivatives recycled before maturity ... ... ... ... ... ... ... - 58 Gross balances in the hedging reserves for continuing hedges 4,357 1,179 Balance remaining in the hedge reserve for which hedge accounting 177 is no longer applied ... ... ... ... ... ... ... ... ... ... (676) Deferred tax balance recognised in other comprehensive income ... ... (1,134) (295) 3,400 208 Cash flow hedge reserve 3,657 Attributable to equity holders of the parent ... ... ... ... ... 633 Attributable to non-controlling interests ... ... ... ... ... ... 73 1 3,730 634 Cost of hedging reserve (317) Attributable to equity holders of the parent ... ... ... ... ... (426) Attributable to non-controlling interests ... ... ... ... ... ... (13) - (330) (426) Total 3,400 208 The hedging reserve comprises the effective portion of the cumulative net change in the fair value of cash flow hedge instruments related to hedged transactions that have not yet occurred. The cost of hedging reserve relates to the associated costs attaching to the cash flow hedge reserve, such as counterparty risk and forward point adjustments. The matured derivative contracts carried forward as part of the hedge reserve are those to contracts where the hedge was still effective at maturity but the underlying transactions had not occurred. Hedge ineffectiveness is measured using the critical terms match approach, whereby the timing, currency and notional value of the hedging instrument match the hedged item. Hedge ineffectiveness may arise due to: • differences in the timing of the cash flows of the forecast sales and purchases occurring and the hedging instruments maturing; • changes in the forecast values for the cash flows of hedged items and hedging instruments; and • the effect of the counterparties’ credit risk on the fair value of the foreign currency forward contracts. There was no material ineffectiveness in the current year. The change in value used to calculate current hedge ineffectiveness is shown below: 2025 2024 £’000 £’000 Highly probable forecast sales ... ... ... ... ... ... ... ... (4,440) (1,195) Highly probable forecast purchases ... ... ... ... ... ... ... 83 16 Derivative forward exchange contracts ... ... ... ... ... ... 4,357 1,121 - (58) 26.Capital management The Group’s main objective when managing capital is to safeguard the Group’s ability to continue as a going concern in order to provide returns to shareholders. The Board maintains a strong capital base in order to maintain investor, creditor and market confidence and to sustain future development of the business. Operations are funded through various shareholders’ funds, bank debt, leases and, where appropriate, deferred consideration on acquisitions. The capital structure of the Group reflects the judgement of the Board as to the appropriate balance of funding required. At 30th April, 2025, the capital used was £151.8 million (2024: £165.2 million) as shown in the following table: 83 NOTES TO THE FINANCIAL STATEMENTS 26.Capital management (continued) 2025 2024 £’000 £’000 Cash and cash equivalents ... ... ... ... ... ... ... ... ... (16,643) (30,678) Total lease liabilities ... ... ... ... ... ... ... ... ... ... ... 3,931 9,813 Bank overdrafts ... ... ... ... ... ... ... ... ... ... ... - 48 Bank loans - repayable by instalments ... ... ... ... ... ... ... 2,196 7,072 Bank loans - rolling credit facilities ... ... ... ... ... ... ... ... 26,000 59,000 Net debt in accordance with IFRS 16 ... ... ... ... ... ... ... ... 15,484 45,255 Operating lease debt (former IAS 17 definition) ... ... ... ... ... ... (1,859) (2,324) Relevant net debt for KPI purposes ... ... ... ... ... ... ... ... 13,625 42,931 Total equity attributable to equity holders of the parent ... ... ... ... ... 138,163 122,281 Capital 151,788 165,212 The Group aims to maintain a strong credit rating and headroom whilst optimising the return to shareholders through an appropriate balance of debt and equity funding. At 30th April, 2025 net debt was £13.6 million (2024: £42.9 million). The gearing ratio is 9.9% (2024: 35.1%). The Group manages its capital structure and makes adjustments to it with regard to the risks inherent in the business and in light of changes to economic conditions. Working capital is managed in order to generate maximum conversion of profits into cash and cash equivalents. Proposed dividends are based on current year profits, thereby maintaining equity. The policy for debt is to ensure a smooth debt maturity profile with the objective of ensuring continuity of funding. The repayment profile for the debt is shown in note 27 (b). There were no changes in the Group’s approach to capital management during the year, although during the year it has reduced the net debt to reduce bank interest costs. 27.Financial risk management The Group’s operations expose it to a variety of financial risks that include the effects of changes in market prices (interest rates, foreign exchange rates and commodity prices), credit risk and liquidity. The Group has in place risk management policies that seek to limit the adverse effects on the financial performance of the Group by using various instruments and techniques. Risk management policies have been set by the Board and applied by the Group. a) Credit risk The Group’s financial assets are cash and cash equivalents; trade and other receivables; contract assets; derivative financial assets; the carrying values of which represent the Group’s maximum exposure to credit risk in relation to financial assets. The credit risk on liquid funds is limited because the counterparties are banks with high credit ratings assigned by international credit rating agencies. The Group’s credit risk is primarily attributable to its trade receivables and is managed through the following processes: i) The majority of orders accepted by Group companies are backed by credit insurance; ii) Some orders are accepted with no credit insurance but with letters of credit; iii) Some orders are accepted with no credit insurance and no letter of credit but with an internal analysis of the customer’s size, creditworthiness, historic profitability and payment record; iv) A few orders (less than 10%), with a material value, are taken at risk, following review by at least two Board members; v) Major orders are normally accompanied by stage payments, which helps to mitigate the Group’s credit risk. Whilst the theoretical credit risk would be the actual balances themselves as reported within the table below, this assumes that the credit insurance company is also a credit risk for the invoiced trade debtors and contract assets underwritten by them. The Group’s insurer enjoys a strong credit rating with the likes of Moody’s, S&P and Fitch. As a result, and after having looked back on the Group’s track record of negligible impairment losses on these types of assets over the last ten years, the Directors are of the opinion that there is no cost / benefit in performing an ECL type loss analysis. Impairment provisions are therefore, based on known issues rather than a statistical estimate. 84 NOTES TO THE FINANCIAL STATEMENTS 27. Financial risk management (continued) (a) Credit risk (continued) Exposure to credit risk At the reporting date, the maximum exposure to credit risk for financial assets, stated at their carrying values, was: 2025 2024 Note £’000 £’000 Contract assets ... ... ... ... ... ... ... ... 4 24,310 22,027 Trade receivables ... ... ... ... ... ... ... ... 18 35,931 26,364 Other financial assets due within one year ... ... ... ... 18 1,816 1,443 Cash at bank and cash equivalents ... ... ... ... ... 19 16,643 30,678 Derivative financial assets – due after more than one year ... 16 6,061 5,716 Derivative financial assets – due within one year ... ... ... 16 4,457 2,007 Hypothetical Credit Risk Exposure (by Geographic Region) – assuming no credit insurance At the reporting date, the maximum exposure to credit risk for trade receivables, stated at their carrying values, before taking into account credit insurance, was: 2025 2024 £’000 £’000 UK ... ... ... ... ... ... ... ... ... ... ... ... 5,973 6,193 Rest of Europe ... ... ... ... ... ... ... ... ... ... 4,881 2,914 USA ... ... ... ... ... ... ... ... ... ... ... ... 5,860 3,441 Pacific Basin ... ... ... ... ... ... ... ... ... ... 12,110 6,836 Rest of World ... ... ... ... ... ... ... ... ... ... 7,107 6,980 35,931 26,364 The ageing of trade receivables and impairments at the reporting date was: 2025 Impairment 2024 Impairment Net Gross Net Gross provision provision £’000 £’000 £’000 £’000 £’000 £’000 Current (Not past due) ... 28,281 28,293 (12) 18,781 18,781 - 1 - 30 days past due ... ... 4,813 4,813 - 3,846 3,846 - 31 - 90 days past due ... ... 2,388 2,399 (11) 2,361 2,379 (18) More than 90 days past due 449 712 (263) 1,376 1,636 (260) 35,931 36,217 (286) 26,364 26,642 (278) Management believes that there are no significant credit risks remaining with the above net receivables and that the credit quality of customers is good, based on a review of past payment history and the current financial status of the customers. Included in trade receivables are retentions which are job specific and have varying due dates depending on the complexity of the job. These are included in the current category. The Group has not renegotiated the terms of any trade receivables and has not pledged any trade receivables as security. The Directors estimate that the fair value of the Group’s trade and other receivables is approximate to their carrying values. An analysis of the provision for impairment of receivables is as follows: 2025 2025 £’000 £’000 Opening balance at 1st May ... ... ... ... ... ... ... ... 278 242 Increase in provision... ... ... ... ... ... ... ... ... ... 124 79 Release of provision ... ... ... ... ... ... ... ... ... ... (54) (34) Provision utilised during the year ... ... ... ... ... ... ... (48) - Exchange adjustment ... ... ... ... ... ... ... ... ... (14) (9) Closing balance at 30th April ... ... ... ... ... ... ... ... 286 278 (b) Liquidity risk Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation. At the year-end the Group had the following unutilised bank facilities in respect of which all conditions precedent had been met: 85 NOTES TO THE FINANCIAL STATEMENTS 27. Financial risk management (continued) (b) Liquidity risk (continued) 2025 2024 £’000 £’000 Uncommitted ... ... ... ... ... ... ... ... ... ... 6,050 6,002 Committed ... ... ... ... ... ... ... ... ... ... 43,500 10,500 Total unutilised bank facilities 49,550 16,502 The Group’s principal borrowing facilities are provided by three banks in the form of borrowings and short-term overdraft facilities. The quantum of borrowing facilities available to the Group is reviewed regularly in light of current working capital requirements and the need for capital investment for the long-term future for the Group. After the year-end, the Group has renewed a revolving credit facility that was due to expire in July 2025 on a four year term, as a prudent policy to ensure that guaranteed facilities and the appropriate level of headroom is available to the Group. Maturity analysis The table below analyses the Group’s financial liabilities into maturity groupings based on the period outstanding at the balance sheet date up to the contractual maturity date. All figures are contracted gross cash flows that have not been discounted. Within 2-3 years 4-5 years 5+ years Total Carrying 1 year value £’000 £’000 £’000 £’000 £’000 £’000 Non-derivative financial liabilities Bank loans - repayable 941 598 164 654 2,357 2,196 by instalments ... ... ... Bank loans - revolving ... ... 14,000 11,000 1,000 - 26,000 26,000 Lease liabilities ... ... ... 1,690 1,769 423 406 4,288 3,931 Trade and other ... ... 36,801 - - - 36,801 36,801 financial liabilities Total non-derivatives 53,432 13,367 1,587 1,060 69,446 68,928 Derivatives financial liabilities Forward exchange contracts: (13,748) (4,460) (6,858) - (25,066) - (Inflow) ... ... ... Outflow ... ... ... 13,987 4,414 7,381 - 25,782 684 Total derivatives 239 (46) 523 - 716 684 Within 2024 Contractual Cash Flows Carrying 2-3 years 4-5 years 5+ years Total 1 year value £’000 £’000 £’000 £’000 £’000 £’000 Non-derivative financial liabilities Bank overdrafts ... ... ... 48 - - - 48 48 Bank loans - repayable 1,471 2,445 1,073 4,968 9,957 7,072 by instalments ... ... ... Bank loans - revolving ... ... 10,000 21,000 28,000 - 59,000 59,000 Lease liabilities ... ... ... 3,430 5,296 1,777 598 11,101 9,813 Trade and other ... ... 30,572 - - - 30,572 30,572 financial liabilities Total non-derivatives 45,521 28,741 30,850 5,566 110,678 106,505 Derivatives financial liabilities Forward exchange contracts: (Inflow) ... ... ... (30,870) (22,291) (4,091) - (57,252) - Outflow ... ... ... 31,087 22,433 4,197 - 57,717 528 Total derivatives 217 142 106 - 465 528 Bank loans repayable by instalments include a loan of £1 million with the final payment due in the year ended 30th April, 2039. . 86 NOTES TO THE FINANCIAL STATEMENTS 27. Financial risk management (continued) (c) Market risk Foreign exchange risk The Group is subject to fluctuations in exchange rates on its net investments overseas and transactional monetary assets and liabilities not denominated in the operating (or “functional”) currency of the operating unit involved. The Group is exposed to fluctuations in several currencies which give rise to the net currency gains and losses recognised in the statement of profit or loss. In respect of other monetary assets and liabilities held in currencies, the Group ensures that the net exposure is eliminated through the use of forward exchange contracts or spot transactions at the time the contractual commitment is in place. Currency derivatives The Group utilises currency derivatives to hedge future highly probable transactions. There is an economic relationship between the hedged items and the hedging instrument as the notional amount and maturity dates of the hedging instrument match the expected values and timing of the highly probable sales and purchases. The Group has established a hedge ratio of 1:1 for the hedging relationships because the underlying risk of the currency derivatives is the same as the currency risk of the highly probable sales and purchases. Forecast transactions The Group classifies its forward exchange contracts hedging forecast transactions as cash flow hedges and states them at fair value. Recognised assets and liabilities Changes in the fair value of forward exchange contracts, which economically hedge monetary assets and liabilities in foreign currencies and for which no hedge accounting is applied, are recognised in the statement of profit or loss. Both the changes in fair value of the forward contracts and the foreign exchange gains and losses relating to the monetary items, are recognised as part of administrative expenses. 87 NOTES TO THE FINANCIAL STATEMENTS 27. Financial risk management (continued) (c) Market risk (continued) Currency profile of financial assets and liabilities: The non-derivative foreign currency balances have been translated into Sterling using the reporting date spot rates below. US Dollar £’000 Non-derivatives Trade and other receivables 8,740 Cash and cash equivalents 2,849 Trade and other payables (618) Total non-derivatives 10,971 Derivatives - fair value 2025 US 2024 Euro Other Total Euro Other Total Dollar £’000 £’000 £’000 £’000 £’000 £’000 £’000 3,312 6,374 18,426 7,682 1,534 32 9,248 206 172 3,227 1,585 15 38 1,638 (597) (65) (1,280) (217) (78) (78) (373) 2,921 6,481 20,373 9,050 1,471 (8) 10,513 Forward exchange 4,951 307 472 5,730 contracts - assets 1,650 30 - 1,680 Forward exchange contracts - (579) (28) (77) (684) liabilities (380) (58) (90) (528) 4,372 279 395 5,046 1,270 (28) (90) 1,152 Derivatives - nominal value Forward exchange 126,113 25,309 19,399 170,821 contracts - assets 78,187 22,099 111 100,397 Forward exchange contracts - 13,018 4,037 8,817 25,872 42,709 10,865 3,677 57,251 liabilities Total gross 139,131 29,346 28,216 196,693 120,896 32,964 3,788 157,648 contractual cash flows The following significant exchange rates applied during the year, for reporting purposes: Exchange Rates 2025 2024 Average Reporting Average Reporting exchange rate date spot rate exchange rate spot rate US Dollar (USD)... ... ... ... 1.2811 1.3356 1,2577 1.2520 Euro (EUR) ... ... ... ... 1.1888 1.1749 1.1615 1.1710 Hypothetical Sensitivity analysis IFRS 7 requires disclosure of the Group’s exposure to hypothetical changes in foreign exchange rates. The following hypothetical sensitivities are based on the derivative and non-derivative foreign currency balances in the table above. As foreign exchange rates and interest rates continue to fluctuate significantly, the Board considers it most appropriate to provide the hypothetical sensitivities for a 1% change, because these figures can be extrapolated proportionately, to obtain an estimate of the impact of larger movements. The Group’s exposure to foreign currency movements for all other foreign currencies is not considered material. 88 NOTES TO THE FINANCIAL STATEMENTS 27. Financial risk management (continued) Hypothetical Sensitivity analysis (continued) 2024 2025 Effect on Effect on profit Effect on Effect on profit equity before tax equity before tax £’000 £’000 £’000 £’000 GBP strengthens by 1% against USD 843 398 (843) (244) GBP strengthens by 1% against EUR 122 78 (199) (22) GBP weakens by 1% against USD (860) (406) 861 249 GBP weakens by 1% against EUR (124) (79) 203 22 (d) Interest rate risk The Group is subject to fluctuations in interest rates on its borrowings and surplus cash. The Group is aware of the financial products available to hedge against adverse movements in interest rates. Formal reviews are undertaken to determine whether such instruments are appropriate for the Group. Interest rate swap In July 2021, the Company signed a contract to mitigate the impact of interest rate risk by taking out an interest rate swap derivative fixing £30 million of notional debt at less than 1% versus the variable inter-bank lending rate (SONIA) for a period of 10 years, from 1st September, 2021 to 31st August, 2031. Hedge accounting is not applied for this instrument and all movements in fair value are recognised in profit or loss. The table below shows the Group’s financial assets and liabilities split by those bearing fixed and floating rates and those that are non interest-bearing. 2025 2024 Non Fixed Floating Non Fixed Floating interest- Total interest- Total rate rate bearing rate rate bearing £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 Cash and cash - 16,643 - 16,643 equivalents - 30,678 - 30,678 Contract assets - - 24,310 24,310 - - 22,027 22,027 Trade and financial - - 37,747 37,747 assets - - 27,807 27,807 Derivative assets - - 10,518 10,518 - - 7,723 7,723 Contract liabilities - - (55,162) (55,162) - - (34,124) (34,124) Trade and other - - (36,801) (36,801) financial liabilities - - (30,572) (30,572) Derivative liabilities - - (684) (684) - - (528) (528) Bank overdrafts - - - - - (48) - (48) Bank loans - repayable by (2,196) - - (2,196) instalments (3,058) (4,014) - (7,072) Bank loans - - (26,000) - (26,000) revolving - (59,000) - (59,000) Lease liabilities (1,937) (1,994) - (3,931) (2,558) (7,255) - (9,813) (4,133) (11,351) (20,072) (35,556) (5,616) (39,639) (7,667) (52,922) The contract liabilities are predominantly advance payments from customers. The fixed interest rates for bank loans repayable by instalments are 1.96% to 3.15%. Floating interest rates for bank loans are calculated as SONIA or UK base rate, with bank margins of less than 2.1%. Sensitivity analysis As the Group has floating rate borrowings lower than the interest rate SWAP of £30 million, that is in place until August 2031 and the Board intends to keep borrowing at or below this amount, therefore any change in the interest rates, either an increase or a decrease, would not change the Group’s profitability, due to being fully hedged. A 1% decrease in interest rates would increase profit before tax by £nil (2024: £295,527). 89 NOTES TO THE FINANCIAL STATEMENTS 28. Total financial assets and liabilities IFRS 7 requires that the classification of financial instruments at fair value be determined by reference to the source of inputs used to derive the fair value. This classification uses the following three-level hierarchy: 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 (i.e. as prices) or indirectly (i.e. derived from prices); Level 3 - inputs for the asset or liability that are not based on observable market data (unobservable inputs). The table below sets out the Group’s accounting classification of financial assets and liabilities and their fair values at 30th April, 2025 and 30th April, 2024. Year ended 30th April, 2025 Year ended 30th April, 2024 Carrying Fair Carrying Fair value Level amount value amount £’000 £’000 £’000 £’000 Financial assets Amortised cost Cash and cash equivalents ... Other 16,643 16,643 30,678 30,678 Contract assets ... ... ... Other 24,310 24,310 22,027 22,027 Trade receivables ... ... Other 35,931 35,931 26,364 26,364 Other financial assets ... ... Other 1,816 1,816 1,443 1,443 Fair value through profit and loss 744 744 Derivative financial assets ... Level 2 36 36 Interest rate swap ... ... Level 2 4,788 4,788 6,042 6,042 Fair value - hedging instrument 4,986 4,986 Derivative financial assets ... Level 2 1,645 1,645 Total financial assets ... 89,218 89,218 88,235 88,235 Financial liabilities Amortised cost Contract liabilities ... ... Other 55,162 55,162 34,124 34,124 Trade payables ... ... ... Other 21,303 21,303 20,432 20,432 Other financial liabilities ... Other 4,107 4,107 5,236 5,236 Lease liabilities ... ... ... Other 3,931 4,288 9,813 11,101 Bank overdrafts ... ... Other - - 48 48 Bank loans - 2,196 2,358 repayable by instalments ... Other 7,072 9,938 Bank loans - 26,000 26,000 rolling credit facilities ... Other 59,000 59,000 Fair value through profit and loss 55 55 Derivative financial liabilities Level 2 4 4 Fair value - hedging instrument 629 629 Derivative financial liabilities Level 2 524 524 Total financial liabilities ... 113,383 113,902 136,253 140,407 Derivative financial instruments not designated as cash flow hedging instruments are measured at fair value through profit and loss. The fair value of the short-term cash and cash equivalents, trade and other receivables, contract assets, trade and other financial liabilities, and contract liabilities, is the same as carrying value. 90 NOTES TO THE FINANCIAL STATEMENTS 29. Capital Commitments Contracted capital commitments at 30th April, 2025 for which no provision has been made in these financial statements were £5,985,188 (2024: £2,265,096). 30. Guarantees and contingencies The table below sets out the number and value of unexpired bank guarantee bonds as at 30th April, 2025 and 30th April, 2024. These guarantee bonds are required as part of the terms and conditions within our Mechanical Engineering contracts. 2025 2024 £’000 £’000 142 guarantee and bonds contracts (2024: 154) ... ... ... ... ... 14,350 8,668 31. Subsequent events After the balance sheet date an ordinary dividend of 280p per qualifying ordinary share was proposed by the Directors (2024: Ordinary dividend of 133p). The current year proposed ordinary dividend of £21,027,000 (2024: Proposed ordinary dividend of £9,988,000) has not been recognised as a liability within these financial statements. After the year-end, the Group has renewed a revolving credit facility, that was due to expire in July 2025, on a four year term, as a prudent policy to ensure that guaranteed facilities and the appropriate level of headroom is available to the Group. 32. Non-principal subsidiaries and associates Registered Country of Class of Company name address Incorporation shares held % held Non-principal Subsidiaries: Mechanical Engineering: Goodwin Engineering Training Company Limited 1 England and Wales Ordinary 100.0 Easat Radar Systems India Private Limited ... ... 4 India Ordinary 100.0 Goodwin Submersible Pumps West Africa Limited ... 17 Ghana Ordinary 100.0 Aldercroft Development Limited ... ... ... ... 1 England and Wales Ordinary 100.0 Refractory Engineering: Gold Star Brasil Industria E Comercio de Materials Para Fundicao Ltda ... ... ... ... ... ... ... 7 Brazil Ordinary 100.0 Jewelry Wax Limited ... ... ... ... ... ... ... 13 Thailand Ordinary 61.5 GRS Silicone Company Limited ... ... ... ... 16 China Ordinary 75.5 Shenzhen King-Top Modern Hi-Tech Company Limited 15 China Ordinary 75.5 AVD Fire Limited ... ... ... ... ... ... ... 1 England and Wales Ordinary 100.0 Group Centre: Llwynderw Woodland Limited 1 England and Wales Ordinary 100.0 Non-principal holding companies: Goodwin Refractory Services Holdings Limited ... ... 1 England and Wales Ordinary 100.0 Goodwin Refractory Services Thailand Limited ... ... 10 Thailand Ordinary 61.5 Ying Tai (U.K.) Limited ... ... ... ... ... ... 1 England and Wales Ordinary 75.5 Non-principal Associates: Tet Goodwin Property Company Limited ... ... ... 10 Thailand Ordinary 49.0 Dormant companies: Gold Star Powders Limited ... ... ... ... ... 1 England and Wales Ordinary 100.0 Net Central Limited ... ... ... ... ... ... ... 1 England and Wales Ordinary 100.0 Sandersfire International Limited ... ... ... ... 1 England and Wales Ordinary 100.0 Soluform Limited ... ... ... ... ... ... ... 1 England and Wales Ordinary 100.0 Specialist Refractory Services Limited ... ... ... 1 England and Wales Ordinary 100.0 The registered address for each company can be found in note 34. All of the above companies are included as part of the consolidated accounts. The trading companies are all involved in mechanical or refractory engineering. 33. Related parties Transactions between the Company and its subsidiaries have been eliminated on consolidation and are not reported in this note. Year end balances and transactions during the year with the Group’s associate company, Tet Goodwin Property Company Limited, are shown below. 2025 2024 £’000 £’000 Rental cost ... ... ... ... ... ... ... ... ... ... ... 288 290 91 NOTES TO THE FINANCIAL STATEMENTS 34. Registered offices of subsidiaries and associates The registered offices of the companies listed in notes 13 and 32 are listed below 1. Ivy House Foundry, Hanley, Stoke-on-Trent ST1 3NR 2. Brassington, Nr. Matlock, Derbyshire DE4 4HF 3. 13-1, Jungbong-daero, 396 Beon-Gil, Seo-gu, Incheon, South Korea 4. No 39/1-5, Old Mahabalipuram Road, Kalavakkam, Thiruporur Chengalpattu District – 603110, India 5. Suite C, F1, Building #14, Xiya Road No.11, Waigaoqiao Free Trade Zone, 200131, Shanghai, China 6. Hocksteiner Weg 56, D - 41189 Mönchengladbach, Germany 7. Rua das Margaridas s/n, No. 70, Barrio Terra Preta - Mairipora – SP, CEP 07662-025, São Paulo, Brazil 8. Confidential Tax and Business Services, Level 1, 449 Gympie Road, Kedron Qld 4031, Australia 9. Koivupuistontie 34, 01510 Vantaa, Finland 10. 99/9 Moo5 Khlong Yong, Bhudhamontol, Nakhon Pathom, 73170 Thailand 11. No.73, Jiao Xin Road, Lanhe Town, Nansha District, Guangzhou City, 511480, China 12. 400 metres North from Nan Zhai Committee, Xifuzhen Street, Chengyang District, Qingdao City, 266106, China 13. 311/4-5, Mu 10, Khlong Maduea Sub-district, Krathum Baen District, Samut Sakhon Province, Thailand 14. Unit 1 Bridgeway Business Park, Cnr Sam Green Road and Pinnacle Close, Tunney Extension 9, Germiston, Gauteng, 1401, South Africa 15. No.2-1, Shanzixia Road, Dakang Community, Yuanshan Street, Longgang District, Shenzhen City, Guangdong, China 16. 101,102 or No5, 165 Minsheng Road, Lanhe Town, Nansha District, Guangzhou, China 17. 11, NII Ablade Kotey Avenue, East Legon, Accra, Ghana 92 NOTES TO THE FINANCIAL STATEMENTS GOODWIN PLC COMPANY BALANCE SHEET at 30th April, 2025 2025 2024 Note £’000 £’000 NON-CURRENT ASSETS Property, plant and equipment … … … … … … … C4 48,029 37,621 Investment properties ... … … … … … … … C4 35,987 36,791 Right-of-use assets... … ... … … … … … … C4 4,264 9,345 Investments ......... … … … … … … … C5 29,843 29,832 Intangible assets ...... … … … … … … … C6 14,797 15,398 Derivative financial assets … … … … … … … 27, C7 3,913 4,837 Group receivables ... … ... … … … … … … C8 37,139 40,703 173,972 174,527 CURRENT ASSETS Other receivables ... … … … … … … … … C8 1,066 1,006 Derivative assets ... … … … … … … … 27, C7 876 1,517 Cash at bank and in hand... … … … … … … 7,575 21,616 9,517 24,139 TOTAL ASSETS... … … … … … … ...... 183,489 198,666 CURRENT LIABILITIES Borrowings ... … … … … … … … … ... C9 15,860 13,305 Trade and other payables… … … … … … … ... C10 40,807 22,968 Derivative liabilities … … … … … … … ... 1 - 56,668 36,273 NON-CURRENT LIABILITIES Borrowings ... … … … … … … … … ... C9 13,415 59,106 Accruals and deferred income … … … … … … … 733 883 Deferred tax liabilities ...... … … … … … … C11 11,738 11,006 25,886 70,995 TOTAL LIABILITIES ... … … … … … … ...... 82,554 107,268 NET ASSETS......... … … … … … … … 100,935 91,398 EQUITY Called up share capital ... … … … … … … … C12 751 751 Cash flow hedge reserve … ... … … … … … … 1 315 Cost of hedging reserve … … … … … … … … - (72) Profit and loss account ...... … … … … … … 100,183 90,404 TOTAL EQUITY ... … … … … … … ...... 100,935 91,398 Profit after tax for the year... … … … … … … 19,767 16,785 These financial statements were approved by the Board of Directors on 29th July, 2025 and signed on its behalf by: T. J. W. Goodwin Director M. S. Goodwin Director S. R. Goodwin Director Company Registration Number: 305907 The notes on pages 96 to 105 form part of these financial statements. 93 NOTES TO THE FINANCIAL STATEMENTS GOODWIN PLC COMPANY STATEMENT OF COMPREHENSIVE INCOME for the year ended 30th April, 2025 2025 2024 £’000 £’000 PROFIT FOR YEAR 19,767 16,785 OTHER COMPREHENSIVE INCOME / (EXPENSE) ITEMS THAT MAY BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS: Cash flow hedges - effective portion of changes in fair value … … … … Cash flow hedges - ineffectiveness transferred to profit or loss … … … Cash flow hedges - amounts transferred to profit or loss … … … … Cash flow hedges - deferred tax (credit) / charge ...... … … … … Cost of hedging - changes in fair value ......... … … … … Cost of hedging - ineffectiveness transferred to profit or loss … … … … Cost of hedging - amounts transferred to profit or loss ... … … … … Cost of hedging - deferred tax charge / (credit) ...... … … … … OTHER COMPREHENSIVE (EXPENSE) / INCOME FOR THE YEAR, NET OF INCOME TAX TOTAL COMPREHENSIVE INCOME FOR THE YEAR … (327) 416 … - (16) … (91) 20 … 104 (105) … 86 (100) … - 4 … 10 - … (24) 24 (242) 243 19,525 17,028 The notes on pages 96 to 105 form part of these financial statements. 94 NOTES TO THE FINANCIAL STATEMENTS GOODWIN PLC COMPANY STATEMENT OF CHANGES IN EQUITY at 30th April, 2025 Share- Cash flow Cost of Share based Retained Total payments hedge hedging capital reserve reserve reserve earnings equity £’000 £’000 £’000 £’000 £’000 £’000 YEAR ENDED 30TH APRIL, 2025 751 - 315 (72) 90,404 91,398 Balance at 1st May, 2024 ... Profit for the year ... ... - - - - 19,767 19,767 Effective portion of changes - - (327) 86 - (241) in fair value ...... ... Amounts reclassified - - (91) 10 - (81) to profit or loss ...... ... Deferred tax (charge) / credit - - 104 (24) - 80 Other comprehensive income / - - (314) 72 - (242) (expense) for the year TOTAL COMPREHENSIVE INCOME FOR THE YEAR - - (314) 72 19,767 19,525 Transactions with owners Dividends paid ...... ... - - - - (9,988) (9,988) BALANCE AT 30TH APRIL, 2025 751 - 1 - 100,183 100,935 YEAR ENDED 30TH APRIL, 2024 Balance at 1st May, 2023 ... 769 5,244 - - 85,862 91,875 Profit for the year ... ... - - - - 16,785 16,785 Effective portion of changes in fair value ...... ... - - 416 (100) - 316 Ineffectiveness transferred to profit or loss ...... ... - - (16) 4 - (12) Amounts reclassified to profit or loss ...... ... - - 20 - - 20 Deferred tax (charge) / credit - - (105) 24 - (81) Other comprehensive income / (expense) for the year - - 315 (72) - 243 TOTAL COMPREHENSIVE INCOME FOR THE YEAR - - 315 (72) 16,785 17,028 Transfers between reserves* - (5,244) - - 5,244 - Transactions with owners Buy back of shares ... ... (18) - - - (8,851) (8,869) Dividends paid ...... ... - - - - (8,636) (8,636) BALANCE AT 30TH APRIL, 2024 751 - 315 (72) 90,404 91,398 * The balance on the share-based payment reserve was transferred to retained earnings because all previous share options had vested. The notes on pages 96 to 105 form part of these financial statements. 95 NOTES TO THE FINANCIAL STATEMENTS C1 Accounting policies These financial statements present information about the Company as an individual undertaking and not about its Group. These financial statements were prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (“FRS 101”). Basis of accounting Goodwin PLC (the “Company”) is a Company incorporated and domiciled in England and Wales. These financial statements have been prepared in accordance with International Accounting Standards as adopted by the UK and in conformity with the requirements of the Companies Act 2006. The Company proposes to continue to adopt the reduced disclosure framework of FRS 101 in its next financial statements. The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these financial statements. The Company is exempt under S408 (3) Companies Act 2006 from the requirement to present its own profit and loss account. In these financial statements, the Company has applied the exemptions available under FRS 101 in respect of the following disclosures: • A cash flow statement and related notes; • Comparative period reconciliations for share capital, tangible fixed assets and intangible assets; • Disclosures in respect of transactions with wholly-owned subsidiaries; • Disclosures in respect of capital management; and • The effects of new but not yet effective IFRSs. As the consolidated financial statements of Goodwin PLC include the equivalent disclosures, the Company has also taken the exemptions under FRS 101 available in respect of certain disclosures required by IFRS 13 Fair Value Measurement and the disclosures required by IFRS 7 Financial Instrument Disclosures. Judgements made by the Directors, in the application of these accounting policies, that have significant effect on the financial statements and estimates with a significant risk of material adjustment in the next year are discussed in note 2 of the Group financial statements. Measurement convention The financial statements have been prepared under the historical cost accounting rules except where the measurement of balances at fair value is required as below. Investments in subsidiary and associate undertakings In the Company’s financial statements, investments in subsidiary and associated undertakings are stated at cost less amounts written off for impairment. Foreign currency Transactions in foreign currencies are translated to the respective functional currencies at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in the statement of profit or loss within operating profit. Financial instruments Financial assets and financial liabilities are recognised on the Company’s balance sheet when the Company has become a party to the contractual provisions of the instrument. The principal financial assets and liabilities of the Company are as follows: Principal non-derivative financial assets Other receivables Other receivables principally comprise short-term sales taxes repayable to the Company and receivables from Group undertakings. After being recognised initially at fair value, other receivables are measured, subsequently, at amortised cost. The carrying amount of other receivables is considered to be a reasonable approximation of their fair value. The Company has not made a provision for expected credit losses (ECLs) as it deems that the amounts due from Group undertakings are fully recoverable, given that the Company is privy to both the accounts and future prospects of those Group companies. If an impairment provision is required, where the carrying value of an amount owed by a Group undertaking cannot be fully supported, and it is a material amount, then this is provided for in the Company’s financial statements. Cash and cash equivalents Cash and cash equivalents comprise cash at bank and in hand including cash deposits with an original maturity of three months or less. Equity instruments Equity instruments are stated at par value, with the par value of ordinary shares being reported as share capital. 96 NOTES TO THE FINANCIAL STATEMENTS C1 Accounting policies (continued) Principal non-derivative financial liabilities Financial liabilities are classified according to the substance of the contractual arrangements into which the Company has entered. Bank borrowings Interest-bearing bank loans and overdrafts are recorded, initially, at their fair value less attributable transaction costs. They are subsequently carried at their amortised cost and finance charges are recognised in the statement of profit or loss over the term of the instrument using an effective rate of interest. Trade and other payables Trade and other payables are recognised, initially, at fair value and, subsequently, at amortised cost using the effective interest method where material. Derivative assets and liabilities Derivative financial assets and liabilities are recognised at fair value. The fair value of forward foreign exchange contracts is equal to the present value of the difference between the contractual forward price and the current forward price for the residual maturity of the contract adjusted for counterparty credit risk. The recognition of the gain or loss on re-measuring to fair value those forward foreign exchange contracts, which are used for hedging, is outlined below; for other forward foreign exchange contracts and the interest rate swap derivative, the gain or loss is recognised in the profit or loss. Cash flow hedges Where a derivative financial instrument is designated as a hedge of the variability in cash flows of a recognised asset or liability, or a highly probable forecast transaction, the effective part of any gain or loss on the derivative financial instrument is recognised directly in the hedging reserves. The Company’s hedge relationships are aligned with its risk management objectives and strategy, resulting in a more qualitative and forward-looking approach in ensuring hedge effectiveness. These hedging arrangements have been put in place to mitigate foreign currency exchange risk arising from certain highly probable sales and purchases transactions denominated in foreign currencies. For cash flow hedges, the associated cumulative gain or loss on the relevant derivative financial instrument is removed from equity and recognised in the statement of profit or loss in the same period or periods during which the hedged forecast transaction affects the statement of profit or loss. Any identified ineffective portion of the hedge is recognised immediately in the statement of profit or loss. The full value of the change in fair value is designated as the hedging instrument and taken to the cash flow hedge reserve. Where a derivative financial instrument is not hedge accounted, all changes in fair value are recognised immediately in profit or loss. When a hedging instrument expires or is sold, terminated or exercised, or the Company revokes the designation of the hedge relationship but the hedged forecast transaction is still expected to occur, the cumulative gain or loss, at that point, remains in equity and is recognised in accordance with the above policy when the transaction occurs. If the cash flow hedge transaction is no longer expected to take place, the cumulative unrealised gain or loss recognised in equity is recognised in the statement of profit or loss immediately, within administrative expenses. Property, plant and equipment Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses. Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items of property, plant and equipment. Depreciation is charged to the statement of profit or loss over the estimated useful lives of each part of an item of property, plant and equipment on the following bases: Freehold land ... ... ... ... ... Nil Freehold buildings ... ... ... ... 25 -50 years on reducing balance or cost Plant and machinery ... ... ... 4 -20 years on reducing balance or cost Motor vehicles ... ... ... ... 4 -7 years on reducing balance or cost Tooling ... ... ... ... ... Over estimated production life Other equipment ... ... ... ... 4 - 7 years on reducing balance or cost Assets in course of construction ... Nil Depreciation is charged on cost for assets acquired after April 2023. Most assets acquired before that date are being depreciated on a reducing balance basis. Investment properties Investment properties are properties which are held either to earn rental income or for capital appreciation or for both. Investment properties are stated at cost less accumulated depreciation. Depreciation is charged to the statement to profit or loss on a straight-line or reducing balance basis over the estimated useful lives of investment properties, which is typically 25 years. 97 NOTES TO THE FINANCIAL STATEMENTS C1 Accounting policies (continued) Government grants Government grants relating to income are recognised in the statement of profit or loss. Unamortised government grants relating to property, plant and equipment are recognised in the balance sheet as deferred income. Amortisation of such grants is credited to profit and loss in accordance with the useful lives of the assets to which they relate. Leases Definition of a lease A contract is a lease or contains a lease if it transfers the right to use an identified asset over the contract term, in exchange for payment. In determining whether a contract gives the Company the right to use an asset, the Company assesses whether: • the contract involves the use of an identified asset; • the Company has the right to obtain substantially all of the economic benefit of using the asset; and • the Company has the right to direct the use of the asset by deciding how the asset is employed. Lease term The lease term is the non-cancellable period of a lease, and options to extend the lease or terminate it, where it is probable that the Company will exercise the available options. At the start of a lease, the Company makes a judgement about whether it is reasonably certain to exercise the options, and reassesses this judgement when a change in circumstances may affect the likelihood of exercising the options. Contracts, where the original lease term has expired, with assets continuing to be leased on a short-term rolling basis of a few months, are treated as short- term leases. Lease balances A right-of-use asset and a lease liability are calculated at the beginning of a lease. The right-of-use asset is measured initially at cost, being the opening lease liability, adjusted for any lease payments made by the start of the lease, and for any initial direct costs, which have been incurred. The lease liability is measured initially at the present value of the lease payments, which are outstanding at the start date, discounted at either the rate implicit in the lease or the Company’s incremental borrowing rate. With the exception of leases containing an option to purchase, the Company uses its incremental borrowing rate as the discount rate. Lease liabilities are measured at amortised cost, using the effective rate, and adjusted, as required, for any subsequent change to the lease terms. The right-of-use asset is depreciated on a straight-line basis over the lease term, or from the start date of the lease to the end of the useful life of the right-of-use asset as appropriate. The method of calculating the estimated useful lives of the right-of-use assets and testing for impairment is the same as that for property, plant and equipment. Recognition exemptions Payments for short-term leases, lasting twelve months or less, without a purchase option, are reported as an operating expense on a straight-line basis over the term of the lease. The cost of leasing low-value items is reported as an operating expense over the life of the lease. Intangible fixed assets and amortisation Manufacturing rights, brand names and customer lists purchased by the Company are amortised to nil by equal annual instalments over their estimated useful lives. Expenditure on development activities is capitalised if the product or process is technically and commercially feasible and the Company has sufficient resources to complete development. The expenditure capitalised includes the cost of materials, direct labour and an appropriate proportion of overheads. Amortisation rates are as follows: Manufacturing rights ... ... ... 11 - 15 years Brand names ... ... ... ... ... 20 years Software and licences ... ... ... 3 - 5 years Intellectual property rights ... ... 20 years Non-compete agreements ... ... 2 - 15 years Capitalised development costs ... Minimum expected order unit intake or minimum product life Finance income and costs Finance costs comprise interest payable and interest on finance leases using the effective interest method, together with the amortisation of any facility arrangement fees. Borrowing costs directly attributable to the acquisition, construction or production of an asset, which takes a substantial time to be prepared for use, are capitalised as part of the cost of that asset. Interest income and interest payable is recognised in the statement of profit or loss as it accrues. Pension costs The Company contributes to a defined contribution pension scheme for employees under an Auto Enrolment Pension arrangement, as required by Government legislation. The assets of the scheme are held in independently administered funds. Company pension costs are charged to the statement of profit or loss in the year for which contributions are payable. 98 NOTES TO THE FINANCIAL STATEMENTS C1 Accounting policies (continued) Taxation Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the statement of profit or loss except to the extent that it relates to items recognised in other comprehensive income. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years. Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date. A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Interest swap derivative The mark to market value of the Company’s interest rate swap derivative is treated as not being hedged with the movement on the mark to market valuation being taken through the profit and loss account. C2 Auditor’s remuneration Included in the profit / (loss) before taxation are the following: 2025 2024 £’000 £’000 Fees receivable by the auditor and the auditor’s associates in respect of: Audit of these financial statements ... ... ... ... ... ... ... 133 88 Amounts paid to the Company’s auditor in respect of services to the Company, other than the audit of the Company’s financial statements, have not been disclosed as the information is required instead to be disclosed on a consolidated basis (see note 5 of the Group financial statements). C3 Staff numbers and costs The average number of persons employed by the Company (including Directors) during the year, analysed by category, was as follows: Number of employees 2025 2024 Administration staff ... ... ... ... ... ... ... ... ... ... 59 56 2025 2024 £’000 £’000 The aggregate payroll costs of these persons were as follows: Wages and salaries ... ... ... ... ... ... ... ... ... ... 6,067 6,451 Social security costs ... ... ... ... ... ... ... ... ... ... 661 615 Other pension costs ... ... ... ... ... ... ... ... ... ... 88 104 6,816 7,170 Details of the Directors’ remuneration can be found within the Directors’ Remuneration Report on page 38. The emoluments of the highest paid Director were £451,000 (2024: £435,000). On 30th April, 2025, one Director was a member of a defined contribution pension scheme (2024: one). 99 NOTES TO THE FINANCIAL STATEMENTS C4 Tangible fixed assets Investment Property, Plant and Equipment properties Other Assets in Land and Plant and equipment course of £’000 buildings machinery * construction Total Cost £’000 £’000 £’000 £’000 £’000 Balance at 1st May, 2024 46,900 1,244 43,652 2,096 16,531 63,523 Additions ... ... 731 6 450 139 7,496 8,091 Reclassification ... ... - - 1,202 - (1,202) - Transfer from ROU ... - - 4,359 1,957 - 6,316 Disposals ... ... (85) - (17) - - (17) Balance at 30th April, 2025 47,546 1,250 49,646 4,192 22,825 77,913 Depreciation Balance at 1st May, 2024 10,109 744 23,637 1,521 - 25,902 Charged in the year ... 1,454 20 2,032 27 - 2,079 Transfer from ROU ... - - 320 1,583 - 1,903 Disposals ... ... (4) - - - - - Balance at 30th April, 2025 11,559 764 25,989 3,131 - 29,884 Net book value At 30th April, 2024 ... ... 36,791 500 20,015 575 16,531 37,621 Balance at 30th April, 2025 35,987 486 23,657 1,061 22,825 48,029 * Other equipment comprises motor vehicles, IT hardware and office equipment. ** This is a transfer from the right-of-use assets category, following the repayment of leases during the year. Security The net book value of assets pledged as security for borrowings (note C9) is: 2025 2024 £’000 £’000 Investment property ... ... ... ... ... ... ... ... ... ... - 4,407 Plant and machinery ... ... ... ... ... ... ... ... ... ... 4,086 4,537 4,086 8,944 The Company’s investment properties have been valued, using the cost model, and depreciated over their estimated useful lives – typically 25 years. In the opinion of the Directors, the fair value of the investment properties as at 30th April, 2025 was estimated to be in the range of £45-55 million, compared with the net book value of £36 million. Investment property income and operating expenses The Company rents investment properties to its UK subsidiaries. There are no formal agreements in place and for this reason, it is not possible to disclose a maturity analysis of lease payments. 2025 2024 £’000 £’000 Property income ... ... ... ... ... ... ... ... ... ... 1,545 1,561 Operating expenses ... ... ... ... ... ... ... ... ... ... (850) (814) 100 NOTES TO THE FINANCIAL STATEMENTS C4 Tangible fixed assets (continued) Right-of-use assets Plant and Other machinery equipment Total Cost £’000 £’000 £’000 Balance at 1st May, 2024 ... ... ... ... ... 9,542 1,942 11,484 Additions ... ... ... ... ... ... ... - 55 55 Disposals ... ... ... ... ... ... ... - (40) (40) Transfer to property, plant and equipment ... (4,359) (1,957) (6,316) Balance at 30th April, 2025 5,183 - 5,183 Depreciation Balance at 1st May, 2024 ... ... ... ... ... 835 1,304 2,139 Charged in the year ... ... ... ... ... ... 404 311 715 Disposals ... ... ... ... ... ... ... - (32) (32) Transfer to property, plant and equipment ... (320) (1,583) (1,903) Balance at 30th April, 2025 919 - 919 Net book value At 30th April, 2024 ... ... ... ... ... ... 8,707 638 9,345 At 30th April, 2025 4,264 - 4,264 C5 Fixed asset investments Shares in Shares in associated subsidiary undertakings undertakings Total Cost £’000 £’000 £’000 Balance at 1st May, 2024 ... ... ... ... ... 363 35,382 35,745 Additions ... ... ... ... ... ... ... - 11 11 Balance at 30th April, 2025 363 35,393 35,756 Impairment Balance at 1st May, 2024 ... ... ... ... ... - 5,913 5,913 Balance at 30th April, 2025 - 5,913 5,913 Net book value At 30th April, 2024 ... ... ... ... ... ... 363 29,469 29,832 At 30th April, 2025 363 29,480 29,843 Details of the principal subsidiaries and associates are listed in note 13. A list of non-principal subsidiaries and associates is included in note 32 of the Group financial statements. The UK subsidiaries listed below are exempt from the requirement to have an audit and to file audited financial statements by virtue of Section 479A of the Companies Act 2006. In adopting the exemption, Goodwin PLC has provided a guarantee to these subsidiaries in accordance with Section 479C of the Companies Act 2006. Company % shares Company name number held Goodwin Engineering Training Company Limited ... ... 11385436 100.0 Goodwin Refractory Services Holdings Limited ... ... ... 04666689 100.0 Llwynderw Woodland Limited ... ... ... ... ... ... 15706169 100.0 Ying Tai (U.K.) Limited ... ... ... ... ... ... ... 04090694 75.0 101 NOTES TO THE FINANCIAL STATEMENTS C6 Intangible assets Brand names and Manu- Software Develop- intellectual facturing and ment property rights Licences costs Total Cost £’000 £’000 £’000 £’000 £’000 Balance at 1st May, 2024 ... ... 8,183 1,672 736 11,893 22,484 Intercompany transfers ... ... - - - 594 594 Balance at 30th April, 2025 8,183 1,672 736 12,487 23,078 Amortisation Balance at 1st May, 2024 ... ... 2,631 1,244 338 2,873 7,086 Amortisation for the year ... ... 361 53 98 683 1,195 Balance at 30th April, 2025 2,992 1,297 436 3,556 8,281 Net book value At 30th April, 2024 ... ... 5,552 428 398 9,020 15,398 At 30th April, 2025 5,191 375 300 8,931 14,797 Note 15 in the Group financial statements includes details of the Company’s significant intangible assets. C7 Derivative assets 2025 2024 £’000 £’000 Due after more than one year 3,913 Interest rate swap ... ... ... ... ... ... ... ... ... ... 4,814 Derivative assets designated as cash flow hedging instruments ... ... - 23 3,913 4,837 Due within one year 875 Interest rate swap ... ... ... ... ... ... ... ... ... ... 1,230 Derivative assets designated as cash flow hedging instruments ... ... 1 287 876 1,517 The Group utilises interest rate swap derivatives to hedge against future movements in floating interest rates against the Group’s floating rate debt. Hedge accounting is not applied for these instruments and all movements in fair value are recognised in profit or loss. Further details are contained in note 27 of the Group financial statements. 102 NOTES TO THE FINANCIAL STATEMENTS C8 Other receivables 2025 2024 Due after more than one year £’000 £’000 Interest-bearing 2,783 Amounts owed by Group undertakings – repayable on demand ... ... 604 Amounts owed by Group undertakings – repayable within five years ... - 205 Non interest-bearing 1,113 Amounts owed by Group undertakings – repayable on demand ... ... 1,224 Amounts owed by Group undertakings – repayable within five years ... 33,243 38,670 37,139 40,703 Due within one year 11 Other debtors ... ... ... ... ... ... ... ... ... ... 7 Prepayments and accrued income ... ... ... ... ... ... ... 812 759 Corporation tax receivable... ... ... ... ... ... ... ... ... 243 240 1,066 1,006 * Amounts owed by Group undertakings are considered to be repayable within five years, as the Company supports the working capital requirements of the Group undertakings. Repayment is required by the Company only when there are excess funds within each specific Group undertaking. C9 Borrowings This note provides information about the contractual terms of the Company’s interest-bearing bank loans and borrowings. For more information about the Group’s exposure to interest rate risk, see note 27 (d) of the Group financial statements. 2025 2024 Non- Current Total Non- Current Total current current liabilities liabilities borrowings liabilities liabilities borrowings Bank loans - repayable ... £’000 £’000 £’000 £’000 £’000 £’000 424 804 1,228 by instalments ... ... 4,995 1,005 6,000 Bank loans - rolling ... 12,000 14,000 26,000 credit facilities ... ... ... 49,000 10,000 59,000 Lease liabilities ... ... 991 1,056 2,047 5,111 2,300 7,411 13,415 15,860 29,275 59,106 13,305 72,411 Lease liabilities Lease liabilities are payable as follows: 2025 2024 Minimum Minimum lease Interest Principal lease Interest Principal payments payments £’000 £’000 £’000 £’000 £’000 £’000 Within one year ... ... 1,155 99 1,056 2,774 474 2,300 Within two to three years ... 1,019 41 978 4,363 467 3,896 Within four to five years ... 13 - 13 1,268 53 1,215 2,187 140 2,047 8,405 994 7,411 103 NOTES TO THE FINANCIAL STATEMENTS C9 Borrowings (continued) Bank loan repayable by instalments The loans are secured against three furnaces and land (see note C4). Bank loans are repayable as follows: 2025 2024 Minimum Minimum loan Interest Principal loan Interest payments payments £’000 £’000 £’000 £’000 £’000 Within one year ... ... 835 31 804 1,348 343 Within two to three years ... 429 5 424 2,233 557 Within four to five years ... - - - 906 456 After more than five years ... - - - 4,230 1,361 1,264 36 1,228 8,717 2,717 C10Trade and other payables 2025 £’000 Trade payables ... ... ... ... ... ... ... ... ... ... ... 400 Amounts owed to Group undertakings – interest-bearing ... ... ... ... 37,828 Amounts owed to Group undertakings – non interest-bearing ... ... ... 565 Other taxation and social security ... ... ... ... ... ... ... ... 542 Accruals and deferred income ... ... ... ... ... ... ... ... ... 1,472 40,807 Principal £’000 1,005 1,676 450 2,869 6,000 2024 £’000 507 311 20,073 788 1,289 22,968 C11 Provisions for deferred tax Balance at 1st May, 2024 ... ... ... ... ... Recognised in profit or loss ... ... ... ... Recognised in other comprehensive income ... ... ... ... ... Balance at 30th April, 2025 C12 Called up share capital Authorised, allotted, called up and fully paid: Property, plant and Tax equipment Losses Derivatives £’000 £’000 £’000 10,948 (23) 81 789 23 - - - (80) 11,737 - 1 2025 £’000 Total £’000 11,006 812 (80) 11,738 2024 £’000 Balance at 1st May, 7,509,600 (2024: 7,689,600) ordinary shares of 10p each ... 751 Buy back of nil (2024:180,000) ordinary shares of 10p each ... ... ... ... - Balance at 30th April, 7,509,600 (2024: 7,509,600) of ordinary 751 shares of 10p each) Details of the share buy back are contained in note 25 of the Group financial statements. C13 Related party balances and transactions 769 (18) 751 The Company has applied the exemptions available under FRS 101 in respect of the disclosure of transactions with wholly-owned subsidiary companies. The Company has transacted with Easat Radar Systems Limited, Easat Finland Oy, Goodwin Korea Company Limited, Goodwin Refractory Services Thailand Limited, Siam Casting Powers Limited, Ultratec Jewelry Supplies Limited and Ying Tai (U.K.) Limited which are not wholly-owned subsidiaries. 104 NOTES TO THE FINANCIAL STATEMENTS C13Related party balances and transactions (continued) 2025 2024 Related party balances £’000 £’000 Non interest-bearing balances 370 Amounts owed by Group undertakings – repayable on demand ... ... ... - Amounts owed by Group undertakings – repayable within five years ... ... 9,493 6,955 Related party transactions 2,732 Dividend income ... ... ... ... ... ... ... ... ... ... ... 1,248 Interest income ... ... ... ... ... ... ... ... ... ... ... - 31 Management fee income ... ... ... ... ... ... ... ... ... ... 303 289 Rental income ... ... ... ... ... ... ... ... ... ... ... 119 119 Royalty income ... ... ... ... ... ... ... ... ... ... ... 383 162 Sale of tangible and intangible assets ... ... ... ... ... ... ... - 674 Interest expense ... ... ... ... ... ... ... ... ... ... ... - 97 Purchase of intangible assets ... ... ... ... ... ... ... ... ... - 149 Compensation of key management personnel Key management personnel are defined in the Directors’ Remuneration Report on page 38, and their remuneration is disclosed on page 38 of the Group financial statements. C14 Commitments Contracted capital commitments at 30th April, 2025, for which no provision has been made in these financial statements, were £4,626,972 (2024: £259,135). C15 Subsequent events After the balance sheet date, ordinary dividends of £21,027,000 were declared. Proposed dividends are not recognised as liabilities within these financial statements. After the year-end, the Group has renewed a revolving credit facility, that was due to expire in July 2025, on a four- year term, as a prudent policy to ensure that guaranteed facilities and the appropriate level of headroom is available to the Group. C16Dividends 2025 2024 Paid ordinary dividends during the year in respect of prior years £’000 £’000 9,988 133p (2024: 115p) per qualifying ordinary share ... ... ... ... ... 8,636 After the balance sheet date an ordinary dividend of 280p per qualifying ordinary share was proposed by the Directors (2024: Ordinary dividend of 133p). The proposed current year ordinary dividend of £21,027,000 (2024: Proposed ordinary dividend of £9,988,000) has not been recognised as a liability within these financial statements. C17 Accounting estimates and judgements The material accounting estimates and judgements for the Company follow that of the Group which have been considered in note 2 of the Group financial statements. 105 NOTES TO THE FINANCIAL STATEMENTS ALTERNATIVE PERFORMANCE MEASURES Measure Method of calculation / reference Page No. 2025 2024 Gross profit (£’000) Consolidated statement of profit or loss 50 91,609 77,887 Revenue (£’000) Consolidated statement of profit or loss 50 219,709 191,258 Gross profit as percentage of 41.7% 40.7% revenue (%) Gross profit / revenue Profit before tax (£’000) Consolidated statement of profit or loss 50 34,260 24,207 Unrealised loss/(gain) on 10 year 1,257 interest rate swap derivative Consolidated statement of profit or loss 50 (113) Trading profit (£’000) 35,517 24,094 Operating profit (£’000) Consolidated statement of profit or loss 50 37,112 26,895 Capital employed (£’000) Note 26 84 151,788 165,212 Return on capital employed (%) Operating profit / capital employed 24.4% 16.3% Net debt (£’000) Note 26 84 13,625 42,931 Net assets attributable to 138,163 equity holders of the parent (£’000) Consolidated balance sheet 52 122,281 Gearing (%) Net debt / equity, as above 9.9% 35.1% Net profit attributable to equity 24,569 holders of the parent (£’000) Consolidated statement of profit or loss 50 16,902 Net assets attributable to equity 138,163 holders of the parent (£’000) Consolidated balance sheet 52 122,281 Return on investment (%) Net profit / net assets 17.8% 13.8% Revenue (£’000) Consolidated statement of profit or loss 50 219,709 191,258 Average number of employees Note 6 68 1,253 1,225 Revenue per employee (£) Group revenue / average employees 175,346 156,129 Annual post tax profit (£’000) Consolidated statement of profit or loss 50 26,178 17,716 Interest rate SWAP mark to market net 943 of tax @ 25% (2024: 25%) (£’000) Consolidated statement of profit or loss 50 (85) Depreciation owned assets (£’000) Note 5 67 6,663 6,607 Depreciation right-of-use assets (£’000) Note 5 67 1,346 1,497 Amortisation and impairment (£’000) Note 5 67 1,580 1,341 Exclude operating (566) depreciation (£’000) (723) Annual post tax profit + 36,144 26,353 depreciation + amortisation (£’000) 106 NOTES TO THE FINANCIAL STATEMENTS 2021 2022 2023 2024 2025 Continuing operations £’000 £’000 £’000 £’000 £’000 Revenue ... ... ... ... ... ... ... ... 131,231 144,108 185,742 191,258 219,709 Trading profit ... ... ... ... ... ... ... 16,514 17,201 18,940 24,094 35,517 Profit before taxation ... ... ... ... ... 16,514 19,941 22,129 24,207 34,260 Tax on profit ... ... ... ... ... ... ... (3,508) (6,321) (5,616) (6,491) (8,082) Profit after taxation ... ... ... ... ... ... 13,006 13,620 16,513 17,716 26,178 Basic earnings per ordinary share (in pence) ... 167.82p 169.14p 206.81p 224.53p 327.17p Diluted earnings per ordinary share (in pence) ... 164.23p 169.14p 206.81p 224.53p 327.17p Total equity ... ... ... ... ... ... ... 118,028 119,743 129,157 126,650 142,208 Trading profit is defined as profit before tax, less the impact of the interest rate swap valuation. The calculation is reported in the Alternative Performance Measures on page 106. 107