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