Company registration number 02478452 (England and Wales)
BROWNS BUILDERS MERCHANTS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
BROWNS BUILDERS MERCHANTS LIMITED
COMPANY INFORMATION
Directors
Mr J A Wheeler
Mr N Myers
(Appointed 21 November 2025)
Mr J Wheeler
(Appointed 21 November 2025)
Mr P White
(Appointed 21 November 2025)
Company number
02478452
Registered office
123a Old Nottingham Road
Derby
DE1 3QQ
Auditor
Xeinadin Audit Limited
I2 Mansfield Office Suite 0.3
Hamilton Court
Oakham Business Park
Mansfield
Nottinghamshire
United Kingdom
NG18 5FB
BROWNS BUILDERS MERCHANTS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Profit and loss account
7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 24
BROWNS BUILDERS MERCHANTS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2025
- 1 -

The directors present the strategic report for the year ended 31 December 2025.

Review of the business

The company's principal activities continue to be the supply of building, roofing, bathroom and plumbing materials to both the UK trade (mainly house builders, commercial construction and RMI customers) and retail sector s.

Our sales are split into two distinct categories, 'direct' and 'depot'. Direct goods are delivered from a supplier to a site/customer.

The split in sales over the period was approximately 7 2% to 28% respectively.

Principal risks and uncertainties

The company is continually striving to expand its products and services to ensure it spreads any risks to ensure the future sustainability of the business for all stakeholders.

Development and performance

The company's overall sales increased by £8.5m compared to the previous year, reflecting the continued increase in activity across the industry.

Overall gross profit was 14% (2024: 14.1%). Net profit after tax for the year was £256,730.

The company remains committed to supporting customers with good products and quality of service.

On behalf of the board

Mr J A Wheeler
Director
23 June 2026
BROWNS BUILDERS MERCHANTS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2025
- 2 -

The directors present their annual report and financial statements for the year ended 31 December 2025.

Principal activities

The principal activity of the company continued to be that of builders merchants.

Results and dividends

The results for the year are set out on page 7.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mr J A Wheeler
Mr N Myers
(Appointed 21 November 2025)
Mr J Wheeler
(Appointed 21 November 2025)
Mr P White
(Appointed 21 November 2025)
Statement of directors' responsibilities

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 company and of the profit or loss of the company for that period.

In preparing these financial statements, the directors are required to:

- select suitable accounting policies and then apply them consistently;

- make judgements and accounting estimates that are reasonable and prudent; and

- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

BROWNS BUILDERS MERCHANTS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 3 -
Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Mr J A Wheeler
Director
23 June 2026
BROWNS BUILDERS MERCHANTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BROWNS BUILDERS MERCHANTS LIMITED
- 4 -
Opinion

We have audited the financial statements of Browns Builders Merchants Limited (the 'company') for the year ended 31 December 2025 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

- give a true and fair view of the state of the company's affairs as at 31 December 2025 and of its profit for the year then ended;

- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

- have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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.

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 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.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

- the information given in the strategic report and the directors' r eport 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.

BROWNS BUILDERS MERCHANTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BROWNS BUILDERS MERCHANTS LIMITED (CONTINUED)
- 5 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identifie d material misstatements in the strategic report or the directors' r eport.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

- adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

- the financial statements are not in agreement with the accounting records and returns; or

- certain disclosures of directors' remuneration specified by law are not made; or

- we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the directors' r esponsibilities s tatement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

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 our procedures are capable of detecting irregularities, including fraud, is detailed below.

Extent to which the audit was considered capable of detecting irregularities, including fraud

We obtained an understanding of the legal and regulatory frameworks within which the company operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were The Companies Act 2006 and relevant taxation compliance regulations.

In addition, we also concluded that there are certain significant laws and regulations which may have an effect on the determination of the amounts and disclosures in the financial statements, being those laws relating to environmental and occupational health and safety regulations, data protection and GDPR guidelines. The company also has to follow regulations from the Programme for the Endorsement of Forest Certification (PEFC) and the Forest Stewardship Council (FSC) in respect of the timber that i t purchases.

We understood how the company is complying with these frameworks and regulations by making enquiring of management and those responsible for compliance and corroborated these enquiries with reviews of board minutes and any available correspondence with legal advisors.

We assessed that there were risks of material impact on the financial statements from irregularities, including fraud from the ove r ride of controls by management, timing and recognising of income and in the manipulation of the company's key performance indicators to meet targets.

BROWNS BUILDERS MERCHANTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BROWNS BUILDERS MERCHANTS LIMITED (CONTINUED)
- 6 -

Audit response to risks identified

We carried out procedures to respond to these risks, including enquiries of management about their systems and controls to identify these risks of irregularities, testwork to review a sample of journal entries made during the year, reviewing and testing assumptions made on accounting estimates for management biases and testing the timing and recognition of revenue.

Our audit procedures were designed to respond to risks of material misstatements in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve more sophisticated acts, including concealment, collusion or deliberately failing to record transactions through intentional misrepresentation.

There are inherent limitations within an audit, even though it has been properly planned and carried out in accordance with auditing standards and we cannot be responsible for preventing non-compliance and cannot be expected to detect non compliance with all laws and regulations.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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.

Russell Eley FCCA (Senior Statutory Auditor)
For and on behalf of Xeinadin Audit Limited
Statutory Auditors and Accountants
24 June 2026
BROWNS BUILDERS MERCHANTS LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2025
- 7 -
2025
2024
Notes
£
£
Turnover
2
53,369,066
44,805,096
Cost of sales
(45,873,593)
(38,468,078)
Gross profit
7,495,473
6,337,018
Distribution costs
(410,052)
(411,897)
Administrative expenses
(6,159,939)
(5,294,365)
Operating profit
3
925,482
630,756
Interest receivable and similar income
6
886
53,147
Interest payable and similar expenses
7
(527,069)
(470,869)
Profit before taxation
399,299
213,034
Tax on profit
8
(142,569)
(48,454)
Profit for the financial year
256,730
164,580

The profit and loss account has been prepared on the basis that all operations are continuing operations.

BROWNS BUILDERS MERCHANTS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2025
- 8 -
2025
2024
£
£
Profit for the year
256,730
164,580
Other comprehensive income
-
-
Total comprehensive income for the year
256,730
164,580
BROWNS BUILDERS MERCHANTS LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2025
31 December 2025
- 9 -
2025
2024
Notes
£
£
£
£
Fixed assets
Goodwill
10
11,000
14,000
Tangible assets
11
3,385,725
3,488,545
3,396,725
3,502,545
Current assets
Stocks
12
2,234,198
2,274,766
Debtors
13
11,980,680
10,946,409
Cash at bank and in hand
509,000
285,946
14,723,878
13,507,121
Creditors: amounts falling due within one year
14
(12,673,670)
(11,692,648)
Net current assets
2,050,208
1,814,473
Total assets less current liabilities
5,446,933
5,317,018
Creditors: amounts falling due after more than one year
15
(1,551,575)
(1,679,834)
Provisions for liabilities
Deferred tax liability
18
55,511
54,067
(55,511)
(54,067)
Net assets
3,839,847
3,583,117
Capital and reserves
Called up share capital
20
160,000
160,000
Revaluation reserve
423,030
425,045
Profit and loss reserves
3,256,817
2,998,072
Total equity
3,839,847
3,583,117

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 23 June 2026 and are signed on its behalf by:
Mr N Myers
Director
Company registration number 02478452 (England and Wales)
BROWNS BUILDERS MERCHANTS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2025
- 10 -
Share capital
Revaluation reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2024
160,000
427,060
3,462,477
4,049,537
Year ended 31 December 2024:
Profit and total comprehensive income
-
-
164,580
164,580
Dividends
9
-
-
(631,000)
(631,000)
Transfers
-
(2,015)
2,015
-
Balance at 31 December 2024
160,000
425,045
2,998,072
3,583,117
Year ended 31 December 2025:
Profit and total comprehensive income
-
-
256,730
256,730
Transfers
-
(2,015)
2,015
-
Balance at 31 December 2025
160,000
423,030
3,256,817
3,839,847
BROWNS BUILDERS MERCHANTS LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2025
- 11 -
2025
2024
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
23
915,220
(1,259,046)
Interest paid
(527,069)
(470,869)
Income taxes paid
(48,760)
(101,547)
Net cash inflow/(outflow) from operating activities
339,391
(1,831,462)
Investing activities
Purchase of intangible assets
-
0
(15,000)
Purchase of tangible fixed assets
(42,353)
(219,360)
Proceeds from disposal of tangible fixed assets
140
-
0
Interest received
886
53,147
Net cash used in investing activities
(41,327)
(181,213)
Financing activities
Invoice Discounting movement
52,785
2,448,581
Repayment of bank loans
(78,082)
(68,210)
Payment of finance leases obligations
(49,713)
133,389
Dividends paid
-
0
(631,000)
Net cash (used in)/generated from financing activities
(75,010)
1,882,760
Net increase/(decrease) in cash and cash equivalents
223,054
(129,915)
Cash and cash equivalents at beginning of year
285,946
415,861
Cash and cash equivalents at end of year
509,000
285,946
BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
- 12 -
1
Accounting policies
Company information

Browns Builders Merchants Limited is a private company limited by shares incorporated in England and Wales. The registered office is 123a Old Nottingham Road, Derby, DE1 3QQ.

1.1
Basis of preparation

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary a mounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. T he company has therefore taken advantage of e xemptions from the following disclosure requirements:

- Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

- Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

- Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;

- Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

The financial statements of the company are consolidated in the financial statements of Three Jays Limited. These consolidated financial statements are available from its registered office, Old Nottingham Road, Derby, Derbyshire DE31 3QQ.

1.2
Going concern

A true t the time of approving the financial statements, t he directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus t he directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Revenue comprises sales of goods or services provided to customers net of value added tax and other sales taxes, less an appropriate deduction for actual and expected returns and discounts. Revenue is recognised when performance obligations are satisfied and the control of goods or services is transferred to the buyer. Where the performance obligation is satisfied over time, revenue is recognised in accordance with its progress towards complete satisfaction of that performance obligation.

BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
1
Accounting policies
(Continued)
- 13 -
1.4
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 5 years.

1.5
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Freehold land and buildings
2% on cost
Plant and equipment
33% on cost, 20% on cost and 10% on cost
Motor vehicles
20% on cost

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.6
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

1.7
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

1.8
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.9
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
1
Accounting policies
(Continued)
- 14 -
Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future paymen ts discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

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

1.10
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.11
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
1
Accounting policies
(Continued)
- 15 -
Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.12
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.13
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.14
Leases
As lessee

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease s asset are consumed.

BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 16 -
2
Turnover

The turnover and profit before tax are attributable to the one principal activity of the company.

3
Operating profit
2025
2024
Operating profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
22,000
20,950
Depreciation of tangible fixed assets
144,923
138,515
Loss on disposal of tangible fixed assets
110
3,410
Amortisation of intangible assets
3,000
1,000
Operating lease charges
228,613
233,186
Hire of Vehicles
148,574
172,483
4
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2025
2024
Number
Number
Admin
12
12
Sales
54
56
Direct
10
10
Total
76
78

Their aggregate remuneration comprised:

2025
2024
£
£
Wages and salaries
3,585,003
3,151,717
Social security costs
475,558
410,909
Pension costs
238,845
241,481
4,299,406
3,804,107
5
Directors' remuneration
2025
2024
£
£
Remuneration for qualifying services
676,093
366,850
Company pension contributions to defined contribution schemes
11,933
14,000
688,026
380,850
BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
5
Directors' remuneration
(Continued)
- 17 -

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 4 (2024 - 1).

Remuneration disclosed above include the following amounts paid to the highest paid director:
2025
2024
£
£
Remuneration for qualifying services
521,530
366,850
Company pension contributions to defined contribution schemes
10,000
14,000
6
Interest receivable and similar income
2025
2024
£
£
Interest income
Other interest income
886
53,147
7
Interest payable and similar expenses
2025
2024
£
£
Interest on bank loans and invoice discounting facilities
521,218
467,430
Interest on finance leases and hire purchase contracts
5,851
3,439
527,069
470,869
8
Taxation
2025
2024
£
£
Current tax
UK corporation tax on profits for the current period
141,181
48,816
Adjustments in respect of prior periods
(56)
(115)
Total current tax
141,125
48,701
Deferred tax
Origination and reversal of timing differences
1,444
(247)
Total tax charge
142,569
48,454
BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
8
Taxation
(Continued)
- 18 -

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2025
2024
£
£
Profit before taxation
399,299
213,034
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2024: 24.61%)
99,825
52,428
Tax effect of expenses that are not deductible in determining taxable profit
9,515
4,124
Group relief
-
0
(448)
Depreciation on assets not qualifying for tax allowances
31,090
(7,534)
Amortisation on assets not qualifying for tax allowances
750
246
Under/(over) provided in prior years
(55)
(115)
Deferred tax adjustments in respect of prior years
1,444
(247)
Taxation charge for the year
142,569
48,454
9
Dividends
2025
2024
£
£
Interim paid
-
0
631,000
10
Intangible fixed assets
Goodwill
£
Cost
At 1 January 2025 and 31 December 2025
85,000
Amortisation and impairment
At 1 January 2025
71,000
Amortisation charged for the year
3,000
At 31 December 2025
74,000
Carrying amount
At 31 December 2025
11,000
At 31 December 2024
14,000
BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 19 -
11
Tangible fixed assets
Freehold land and buildings
Plant and equipment
Motor vehicles
Total
£
£
£
£
Cost or valuation
At 1 January 2025
3,173,528
855,232
114,649
4,143,409
Additions
-
0
42,353
-
0
42,353
Disposals
-
0
-
0
(1,500)
(1,500)
At 31 December 2025
3,173,528
897,585
113,149
4,184,262
Depreciation and impairment
At 1 January 2025
122,322
464,324
68,218
654,864
Depreciation charged in the year
44,042
82,180
18,701
144,923
Eliminated in respect of disposals
-
0
-
0
(1,250)
(1,250)
At 31 December 2025
166,364
546,504
85,669
798,537
Carrying amount
At 31 December 2025
3,007,164
351,081
27,480
3,385,725
At 31 December 2024
3,051,206
390,908
46,431
3,488,545

Tangible fixed assets includes assets held under finance leases or hire purchase contracts, as follows:

2025
2024
£
£
Plant and equipment
12,646
36,717
Motor vehicles
9,878
14,817
22,524
51,534

Included within cost or valuation of land and buildings is freehold land of £1,049,444 (2024: £1,049,444).

Land and buildings with a carrying value of £1,138,131 (2024: £1,158,645) were revalued on 8th February 2023 by FHP, independent valuer's not connected with the company on the basis of open market value. The valuation confirms to international valuation standards and was based on recent market transactions on arms length terms for similar properties.

Land and buildings are carried at valuation and cost. If revalued l and and buildings were measured using the cost model, the carrying amounts would have been approximately £717,368 (202 4: £7 34,768), being cost £9 84,558 (202 4: £9 84,558) and depreciation £267,190 (202 4: £2 49,790).

Land and buildings also include amounts valued at cost of £1,978,539 (2024: £1,978,539).

BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 20 -
12
Stocks
2025
2024
£
£
Finished goods and goods for resale
2,234,198
2,274,766
13
Debtors
2025
2024
Amounts falling due within one year:
£
£
Trade debtors
11,589,660
10,590,267
Amounts owed by group undertakings
7,257
-
0
Prepayments and accrued income
383,763
356,142
11,980,680
10,946,409
14
Creditors: amounts falling due within one year
2025
2024
Notes
£
£
Bank loans
16
79,588
73,965
Invoice discounting facility
16
5,522,441
5,469,656
Obligations under finance leases
17
44,599
49,758
Trade creditors
6,107,809
5,418,239
Amounts owed to group undertakings
-
0
7,162
Corporation tax
141,181
48,816
Other taxation and social security
499,276
260,995
Accruals and deferred income
278,776
364,057
12,673,670
11,692,648
15
Creditors: amounts falling due after more than one year
2025
2024
Notes
£
£
Bank loans and overdrafts
16
1,483,961
1,567,666
Obligations under finance leases
17
67,614
112,168
1,551,575
1,679,834
Creditors which fall due after five years are payable as follows:
Payable by instalments
1,104,776
1,211,470
BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 21 -
16
Loans and overdrafts
2025
2024
£
£
Bank loans
1,563,549
1,641,631
Invoice discounting facility
5,522,441
5,469,656
7,085,990
7,111,287
Payable within one year
5,602,029
5,543,621
Payable after one year
1,483,961
1,567,666

The invoice discounting facility is secured by a debenture, first legal charge over land and buildings, fixed and floating charges over all assets present and future, and a cross guarantee with Three Jays Limited, the company's parent.

The bank loan is secured against the property to which it relates.

17
Finance lease obligations
2025
2024
Future minimum lease payments due under finance leases:
£
£
Within one year
44,599
49,758
In two to five years
67,614
112,168
112,213
161,926

Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

18
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2025
2024
Balances:
£
£
Accelerated capital allowances
55,511
54,067
BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
18
Deferred taxation
(Continued)
- 22 -
2025
Movements in the year:
£
Liability at 1 January 2025
54,067
Charge to profit or loss
1,444
Liability at 31 December 2025
55,511
19
Retirement benefit schemes
2025
2024
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
238,845
241,481

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

20
Share capital
2025
2024
2025
2024
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
160,000
160,000
160,000
160,000
BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 23 -
21
Operating lease commitments
As lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2025
2024
£
£
Within 1 year
302,111
318,719
Years 2-5
421,899
462,439
After 5 years
-
0
10,000
724,010
791,158
22
Ultimate controlling party

The ultimate controlling party is director, Mr J A Wheeler, who is the majority shareholder of the parent company, Three Jays Limited.

23
Cash generated from/(absorbed by) operations
2025
2024
£
£
Profit after taxation
256,730
164,580
Adjustments for:
Taxation charged
142,569
48,454
Finance costs
527,069
470,869
Investment income
(886)
(53,147)
Loss on disposal of tangible fixed assets
110
3,410
Amortisation and impairment of intangible assets
3,000
1,000
Depreciation and impairment of tangible fixed assets
144,923
138,515
Movements in working capital:
Decrease in stocks
40,568
167,638
Increase in debtors
(1,034,271)
(2,985,403)
Increase in creditors
835,408
785,038
Cash generated from/(absorbed by) operations
915,220
(1,259,046)
BROWNS BUILDERS MERCHANTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 24 -
24
Analysis of changes in net debt
1 January 2025
Cash flows
31 December 2025
£
£
£
Cash at bank and in hand
285,946
223,054
509,000
Borrowings excluding overdrafts
(7,111,287)
25,297
(7,085,990)
Lease liabilities
(161,926)
49,713
(112,213)
(6,987,267)
298,064
(6,689,203)
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