Final Results for the year ended 30 June 2025

About this update from Arcontech Group Plc

[{"type":"text","content":"\n \n   \n   \n ARCONTECH GROUP PLC \n   \n (\"Arcontech\", the \"Company\" or the \"Group\") \n   \n Final Results for the year ended 30 June 2025 \n   \n Arcontech (AIM: ARC), the provider of products and services for real-time financial market data processing and trading, is pleased to announce its final audited results for the year ended 30 June 2025. \n   \n Financial Highlights: \n   \n ·      Turnover was £3,106,991 (2024 £2,910,232) \n ·      Profit before taxation was £987,390 (2024 £1,098,959) down by £111,569 \n ·      Recurring revenues represented 94% of total revenues for the period (2024: 99%) \n ·      Net cash of £7,395,514 (2024 £7,160,177), an increase of 3.3% \n ·      Final dividend increased 6.7% to 4.00 pence per share (2023: 3.75 pence per share) \n   \n Operational Highlights: \n   \n ·      Addition of a new high-end customer \n ·      An increase in consulting income \n ·      Enhancement of product functionality to appeal to a potential wider customer base \n ·      Enlarged support team to strengthen customer relationships \n ·      Active participation in several RFIs (Request for Information) with potential new customers \n ·      Number of prospective clients has increased to be the strongest it has been for many years \n   \n Commenting on the results, Geoff Wicks, Chairman and Non-Executive Director of Arcontech said: \n \"Our strategy has served us well and the concentration on our core market has helped to continue to grow and retain our customer base. Our growing sales and support teams are helping to drive growth with customers and is bringing good new prospects. Customer retention and product development will continue to help with further growth in the coming years.\" \n   \n Enquiries: \n Arcontech Group plc                                                                            020 7256 2300 \n Geoff Wicks, Chairman and Non-Executive Director    \n Matthew Jeffs, Chief Executive    \n               \n Cavendish Capital Markets Ltd (Nomad & Broker)                            020 7220 0500 \n Jonny Franklin-Adams/Isaac Hooper (Corporate Finance) \n Harriet Ward (Corporate Broking)   \n To access more information on the Group please visit:  www.arcontech.com   \n   \n This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 (\"MAR\"), and is disclosed in accordance with the company's obligations under Article 17 of MAR. \n   \n \n   \n Chairman's Statement \n   \n In the year to 30 June 2025 Arcontech benefited from its strong sales pipeline and the Company has continued to grow revenue with a new high-end customer and the return of consulting revenue. Even though we have seen some downsizing due to competitive pressure, we have kept our excellent customer base and continued to improve our position in the market. \n   \n The market remains challenging with our two main competitors offering enhanced packages and many customers having to review costs. We have strengthened customer relationships with an enlarged support team and also widened the scope of our sales operation with a larger team. This has been a key part of improving our prospective customer list. Lead times remain long and we have a number of new prospects in the throes of testing which gives us confidence for further growth. \n   \n Turnover was £3,106,991 (2024: £2,910,232) up 6.8% on last year. Profit before taxation (PBT) was £987,390 (2024: £1,098,959) down 10.1% on last year as a result of higher staffing costs including the annualised cost of a senior customer services hire made part way through the previous financial year, and the strengthening of our development team with the hire of an additional developer.  Statutory earnings per share for the year to 30 June 2025 were 7.05p (2024: 7.98p). \n   \n The proportion of our recurring revenue remains high at 94%, however one-off revenue related to specific requirements for customers has helped our growth during the year. We do not expect this to continue at the same level as we develop products to include many of these individual requirements. We have also continued to secure our customers on longer term contracts which helps to give even greater visibility for the future. \n   \n Financing \n Cash balances were £7,395,514 (2024: £7,160,177) at the year end, an increase of 3.3% from prior year. As at the date of signing this report our cash balance is £8,018,154. This strong balance sheet allows the Company to continue to invest in organic growth and to continue to look for relevant acquisitions. \n   \n Dividend \n I am pleased to announce that subject to approval at the Annual General Meeting we intend to pay a dividend ahead of market expectations of 4.00p per share for the year ended 30 June 2025 (2024: 3.75 pence) an increase of 6.7%, to those shareholders on the register as at the close of business on 3 October 2025 with a dividend payment date of 31 October 2025. \n   \n Outlook \n Our strategy has served us well and the concentration on our core market has helped continue to grow and retain our customer base. We see no reason to change this. At the same time we continue to build out our products and are more competitive in certain areas of the market than before. We currently have a number of potential customers close to contract and have an excellent prospect list. At the same time we expect some churn as the market is increasingly competitive. Consolidation in the market may provide opportunities for us to acquire one of our smaller competitors. \n   \n \n   \n Geoff Wicks \n Chairman and Non-Executive Director \n \n \n Chief Executive's Review \n   \n   \n The 2024/25 financial year saw further revenue growth of 6.8% as a result of non-recurring development work to enable future earnings from the deployment of recurring revenue solutions. Despite the greater focus on development work, the percentage of recurring revenue remained at over 90%.   \n   \n Our clients and prospective clients continue to seek alternatives to their existing market data platform solutions and evidencing that, we have received and are participating in several RFIs (Request for Information) which are at various stages. These projects are involved and take time and, although none have yet been confirmed, we are optimistic of winning several new mandates. \n   \n As well as working to maintain our existing client base, this year has seen a range of engagements and the conclusion of earlier PoCs (Proof of Concept) that included the continuation of a build out to displace an alternative solution at a global investment bank in New York; the development of a custom solution to integrate Arcontech software with an inhouse market data system for another global investment bank; and the development of a new sophisticated market data publishing system for a new central bank customer. In addition to generating non-recurring revenues from this development work, the work will also contribute to our recurring revenues, solidify our position with those clients and create more opportunities with other existing and prospective clients. \n   \n The delivery of complex solutions is invariably not without issue and that Arcontech was able to do so in good time and often with new challenges that were only presented mid-project, is a testament to our abilities and the quality of our solutions and staff. \n   \n As a counter to our hard work and successes we did see a slight reduction in desktop user numbers at one client due to competitor action, however, we are confident the impact has been limited as we renewed a multi-year agreement with the same client shortly afterwards. \n   \n The year also saw positive results from our support team's remit to identify opportunities for growth with existing clients where we have strengthened our relationships. Our support team also worked to keep us abreast of client supplier requirements and I am pleased to say Arcontech is now recognised by UKAS as being accredited with ISO 27001 and ISO 22301.   \n   \n This year has been notable in that our number of prospective clients has increased to be the strongest it has been for many years. Within this the pipeline for existing products remains strong and we are making good progress with the development of an extension to our product range which will allow us to compete more effectively by allowing customers to change their market data platform completely. This has brought interest both from current customers and from new prospects.   \n   \n The past year also saw us formalise our search for potential acquisitions which yielded some interesting results and for which we continue to evaluate the opportunities with growth potential and fit as the primary considerations. \n   \n Our staff are a key asset to the Company and have continued to provide exemplary service and support to our clients. I would like to express my thanks for their continued commitment. \n   \n With our increased product range, stronger relationships with clients and excellent pipeline, we feel optimistic for the year ahead and beyond. \n   \n   \n   \n   \n   \n Matthew Jeffs \n Chief Executive \n   \n   \n   \n \n \n Strategic Report \n   \n The Directors present the group strategic report for Arcontech Group plc and its subsidiaries (\"the Group\") for the year ended 30 June 2025 . \n   \n Principal activities \n   \n The principal activities of the Company and its subsidiaries during the year were the development and sale of proprietary software and provision of computer consultancy services. \n   \n Review of the business and prospects \n   \n A full review of the operations, financial position and prospects of the Group is given in the Chairman's Statement and Chief Executive's Review on pages 2 to 3. \n   \n Key performance indicators (KPIs) \n   \n The Directors monitor the business using management reports and information, reviewed and discussed at monthly Board meetings. Financial and non-financial KPIs used in this report include: \n   \n Financial KPIs : \n                                                                                                                                                                                 \n Revenue £3,106,991 (2024: £2,910,232; 2023: £2,730,172)                    Measurement: \n Revenue from sales made to all customers (excluding intra-group sales which eliminate on consolidation)          \n Performance: \n Increase from 2024 with an increase in once-off development work from existing customers \n                                 \n Adjusted EBITDA £874,083 (2024: £1,030,898; 2023: £1,044,522)      Measurement: \n Adjusted EBITDA is EBITDA before the release of accruals for administrative costs in respect of prior years (as disclosed in the footnote to the Income Statement), and share-based payments.  This measurement is reconciled as Operating Profit (£778,553), add depreciation (£118,367), subtract accruals release (£47,611) and add share-based payments (£24,774). \n This is an alternative, non-IFRS performance measure, that is considered relevant as it provides a more accurate reflection of trading performance than EBITDA. The accruals release for 2023 included a release of £110,000 which was disclosed separately in the Group Statement of Income. \n Performance: \n Adjusted EBITDA is down year-on-year, reflective of an increase in staff costs and professional fees \n                                 \n Adjusted profit £895,819 (2024: £1,043,054; 2023: £861,716)                               Measurement: \n Adjusted profit is net profit after tax (£943,430) less the amount of accruals for administrative costs released (£47,611) as disclosed in the footnote to the Income Statement. This is an alternative, non-IFRS performance measure, that is considered relevant as it provides a more accurate reflection of trading performance than net profit after tax. The accruals release for 2023 included a release of £110,000 which was disclosed separately in the Group Statement of Income. \n Performance: \n Adjusted profit is down year-on-year, reflective of an increase in staff costs and professional fees \n   \n Strategic Report (continued) \n   \n \n \n \n \n Cash £7,395,514 (2024: £7,160,177; 2023: £6,411,241) \n \n \n Measurement: \nCash and cash equivalents held at the end of the year \nPerformance: \nThe Group continues to maintain healthy cash balances subject to any exceptional circumstances or acquisition opportunities \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Earnings per share (basic) 7.05p (2024: 7.98p; 2023: 7.33p) \n \n \n Measurement: Earnings after tax divided by the weighted average number of shares \nPerformance: \nDecrease due to staff costs from an increase in headcount \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Earnings per share (diluted) 7.02p (2024: 7.96p; 2023: 7.32p) \n \n \n Measurement: \nEarnings after tax divided by the fully diluted number of shares \nPerformance: Decrease due to  staff costs from an increase in headcount \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Non-financial KPIs: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Staff retention rate (net) 94% (2024: 94%; 2023: 94%) \n \n \n Measurement: \nNet retention after adjusting for joiners and leavers during  the year \nPerformance: \nStaff morale from our dedicated employees remains strong, reflected in the stable retention rate \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n   \n   \n Environmental, Social and Governance \n   \n Arcontech Group plc qualified as a low energy user in the year ending 30 June 2025 and accordingly is not required to disclose energy consumption and Greenhouse Gas emission information in accordance with the Streamline Energy & Carbon Reporting regulations. \n   \n   \n Principal risks and uncertainties \n   \n The Group's performance is affected by a number of risks and uncertainties, which the Board monitor on an ongoing basis in order to identify, manage and minimise their possible impact. General risks and uncertainties include changes in economic conditions, interest rate fluctuations and the impact of competition. The Group's principal risk areas and the action taken to mitigate their outcome are shown below: \n   \n \n \n \n \n Risk area \n \n \n Nature \n \n \n Mitigation \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Competition \n \n \n Loss of business due to existing competition or new entrants into the market \n \n \n Ongoing investment in research and development \n responding to the changing needs of clients to remain competitive \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Loss of key personnel \n \n \n Inability to execute business plan due to the risk of losing key personnel \n \n \n Employee share option scheme in place \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Brexit \n \n \n Business made difficult due to increased regulations between the UK and Europe caused by Brexit \n \n \n Arcontech is a global company and as such seeks growth across a geographically diverse customer base \n \n \n \n \n   \n   \n   \n   \n   \n   \n Strategic Report (continued) \n   \n Relations with shareholders \n   \n Section 172(1) Statement - Promotion of the Company for the benefit of the members as a whole \n The Directors believe they have acted in the way most likely to promote the success of the Group for the benefit of its members as a whole, as required by s172 of the Companies Act 2006. \n The requirements of s172 are for the Directors to: \n \n ·       Consider the likely consequences of any decision in the long term; \n ·       Act fairly between the members of the Company; \n ·       Maintain a reputation for high standards of business conduct; \n ·       Consider the interests of the Company's employees; \n ·       Foster the Company's relationships with suppliers, customers and others; \n ·       The desirability of the Company maintaining a reputation for high standards of business conduct; and \n ·       Consider the impact of the Company's operations on the community and the environment. \n \n   \n Section 172(1) Companies Act 2006 \n The Board takes decisions with the long term in mind, and collectively and individually aims to uphold the highest standards of conduct. Similarly, the Board understands that the Company can only prosper over the long term if it understands and respects the views and needs of its customers, distributors, employees, suppliers and the wider community in which it operates. \n   \n A firm understanding of investor needs is also vital to the Company's success. The Directors are fully aware of their responsibilities to promote the success of the Company in accordance with Section 172(1) of the Companies Act 2006. The text of Section 172(1) of the Companies Act 2006 has been sent out to each main Board Director. \n   \n The Board ensures that the requirements are met, and the interests of stakeholders are considered as referred to elsewhere in this report and through a combination of the following: \n   \n ·      A rolling agenda of matters to be considered by the Board through the year, which includes an annual strategy review meeting, where the strategic options for the following year are developed; \n ·      At each board meeting, to receive and discuss a report on customers, employees and other colleagues, and investors; \n ·      Standing agenda points and papers; \n ·      A review of certain of these topics through the Audit Committee and the Remuneration Committee agenda items referred to in this report; and \n \n ·       Detailed consideration is given to of any of these factors where they are relevant to any major decisions taken by the Board during the year. \n \n   \n The Group's operation is the development and sale of proprietary software and provision of computer consultancy services. The Board has identified its key stakeholders as its customers, shareholders, employees and suppliers. The Board keeps itself appraised of its key stakeholders' interests through a combination of both direct and indirect engagement, and the Board has regard to these interests when discharging its duties. \n The application of the s172 requirements can be demonstrated in relation to some of the key decisions made during the year to 30 June 2025: \n \n ·       Allocation of the Group's capital in a way which offers significant returns to shareholders in line with the Company's dividend policy, while also ensuring that the Group retains flexibility to continue to deploy capital towards profitable growth; \n ·       Continuation of a hybrid location working format for staff as working environments have evolved over recent years, while ensuring that the Group continued to deliver both the high level of service and security that our customers depend on without compromising the health and safety of employees. \n \n During the year to 30 June 2025, the Board assessed its current activities between the Board and its stakeholders, which demonstrated that the Board actively engages with its stakeholders and takes their various objectives into consideration when making decisions. Specifically, actions the Board has taken to engage with its stakeholders over the last twelve months include: \n   \n ·      All Directors attended the 2024 AGM to answer questions and receive additional feedback from investors; \n ·      The outcome of the AGM is published on the Company's corporate website; \n ·      The Board receives regular updates on the views of shareholders through briefings and reports from the executive directors, and the Company's brokers; \n ·      Arranged meetings with certain stakeholders to provide them with updates on the Company's operational activities and other general corporate updates; \n ·      We discussed feedback from investors' and analysts' meetings following the release of our annual and half-year announcements. We have an investor relations programme of meetings with existing and potential shareholders; \n ·      Monitored company culture and engaged with employees on efforts to continuously improve company culture and morale; and \n ·      A range of corporate information (including all Company announcements) is also available to shareholders, investors and the public on the Company's corporate website: www.arcontech.com . \n   \n The Board believes that appropriate steps and considerations have been taken during the year so that each Director has an understanding of the various key stakeholders of the Company. The Board recognises its responsibility to contemplate all such stakeholder needs and concerns as part of its discussions, decision-making, and in the course of taking actions, and will continue to make stakeholder engagement a top priority in the coming years. \n   \n   \n Approved on behalf of the board on 9 September 2025 by: \n   \n   \n   \n \n \n \n \n Matthew Jeffs \n \n \n \n \n \n \n \n Chief Executive \n \n \n \n \n \n \n \n   \n \n \n   \n Board of Directors \n   \n   \n Directors - Executive \n   \n Matthew Jeffs (Chief Executive Officer) \n   \n Matthew was appointed Chief Executive Officer in April 2013. Matthew spent 10 years with Barclays International, 10 years with Dow Jones and then 6 years with Reuters in a variety of senior roles. In addition to the UK, he has wide experience in the Asia Pacific region, working in Hong Kong, Japan, Korea (where he was country manager for Reuters and country representative for Dow Jones), Thailand and Vietnam. In his most recent role, Matthew was the Managing Director, ICS International at Broadridge Financial Solutions where he was responsible for the overall management of the Global Proxy business with offices in the U.K., U.S., Japan, Australia and India. Matthew has an MBA from Buckinghamshire Business School. \n   \n Directors - Non-Executive \n   \n Geoff Wicks (Chairman) \n   \n Geoff was appointed Non-Executive Director in July 2020, and Chairman and in September 2020. Geoff was most recently Chairman of ULS Technology plc (now Smoove PLC), the provider of online technology platforms for the UK conveyancing and financial intermediary markets. Prior to this, he was CEO of Group NBT plc, a specialist in online brand protection and digital asset management, from 2001 until he led the sale of the business to HGCapital in 2011. He remained part of the Group NBT business, now renamed NetNames, as a non-executive director until 2013. Geoff spent much of his earlier career at Reuters, including heading divisions in the UK, France and Nordic regions and latterly was director of corporate communications. Prior to Reuters, Geoff worked in the banking and insurance industries. \n   \n   \n Raj Nagevadia \n   \n Raj was appointed Non-Executive Director in October 2022. Raj is the current Chief Financial Officer (CFO) of Bfinance, a financial services consultancy, and holds a wealth of experience in financial managerial roles across the technology sector, primarily as a CFO. Prior to Bfinance, Raj was CFO of SecureData Europe, a cyber security management service, where he oversaw a broad range of acquisitions. Before this, Raj was CFO of NetNames (formerly Group NBT), the AIM quoted internet services provider, for over 10 years. Here, Raj managed the company's acquisition strategy as well as aiding in the sale of the Company to Hg Capital in 2011. \n   \n   \n   \n \n \n Corporate Governance \n   \n Corporate governance report \n   \n This Corporate Governance Report forms part of the Directors' Report. \n   \n The Directors recognise the importance of, and are committed to, high standards of corporate governance. Of the two widely recognised formal codes, the directors have decided to adhere to the Quoted Companies Alliance Corporate Governance (\"QCA Code\") code. The Group's compliance with the 2023 version of the code is summarised below and can be found in full on the Group's website at: https://www.arcontech.com/wp-content/uploads/2025/02/Arcontech-Corporate-Governance_Feb-25.pdf \n   \n   \n The working of the Board and its Committees \n   \n At 30 June 2025, the Board comprised two Non-Executive Directors, one of whom is the Chairman, and one Executive Director. The Board is responsible to the shareholders for the proper management of the Group. It meets regularly to review financial and non-financial performance. Matters for review by the Board are circulated before the Board Meetings. \n   \n All of the Directors are subject to election at the first Annual General Meeting following their appointment and to re-election at least once every three years. \n   \n The Chairman and Non-executive Director have other third-party commitments including directorships of other companies. The Company is satisfied that these commitments have no significant impact on their ability to carry out their responsibilities effectively. All Directors have access to the advice and services of the Company Secretary, who is responsible to the Board for ensuring that Board procedures are followed, and that applicable rules and regulations are complied with. In addition, the Company Secretary will ensure that the Directors receive appropriate training as necessary. All Directors are supplied with information in a timely manner in a form, and of a quality, appropriate to enable them to discharge their duties. \n   \n During the year, certain Directors who were not Committee members attended meetings of the Audit Committee and Remuneration Committee by invitation. These details have not been included in the table. \n   \n \n   \n Board meeting attendance \n   \n \n \n \n \n \n \n \n Board \n Meeting \n \n \n Audit \n Committee \n \n \n Remuneration Committee \n \n \n Nomination Committee \n \n \n \n \n Executive Directors \n Matthew Jeffs \n \n \n   \n 10/10 \n \n \n   \n 2/2 \n \n \n   \n N/A \n \n \n   \n N/A \n \n \n \n \n Non-Executive Directors \n Geoff Wicks (Independent) \n Raj Nagevadia (Independent) \n \n \n   \n 10/10 \n 10/10 \n \n \n   \n 2/2 \n 2/2 \n   \n \n \n   \n 1/1 \n 1/1 \n \n \n   \n 0/0 \n 0/0 \n \n \n \n \n   \n   \n \n Board performance \n   \n The Company has a formal process of annual performance evaluation for the Board, its Committees and individual Directors. The Board and its Committees are satisfied that they are operating effectively. A performance evaluation of the Board, its Committees and individual Directors is conducted annually via an internal peer review between Directors. \n   \n \n   \n Corporate Governance (continued) \n   \n Corporate governance report (continued) \n   \n The review is based on key areas, to include Board composition, information, process, internal control, accountability, CEO and top management and standards of conduct. The areas are scored by all members, reviewed by the Chairman and Company Secretary and compared against the previous evaluation. Lower scores are discussed. \n   \n The Company has Directors' and officers' liability insurance in place. \n   \n Committees \n   \n The following committees deal with the Group's affairs: \n   \n Audit Committee \n Details of the Audit Committee are given in its Report on pages 11-12. \n   \n Remuneration Committee \n Details of the Remuneration Committee are given in its Report on pages 13-19. This includes details of the Directors' remuneration, interest in shares, interest in share options, and service contracts. No Director is involved in decisions about their own remuneration. \n   \n Nomination Committee \n The Nomination Committee assists the Board in discharging its responsibilities relating to the composition and make-up of the Board and any committees of the Board. It is also responsible for periodically reviewing the Board's structure and identifying potential candidates to be appointed as Directors or committee members as the need may arise. The Nomination Committee is responsible for evaluating the balance of skills, knowledge and experience and the size, structure and composition of the Board and committees of the Board, retirements and appointments of additional and replacement Directors and committee members and will make appropriate recommendations to the Board on such matters. \n The Nomination Committee is chaired by Geoff Wicks. Raj Nagevadia is the other committee member. The Nomination Committee is mandated to meet not less than once a year. There was no meeting of the Nominations Committee for the year under review as the Board made the collective decision that with Non-Executive Director appointments and retirements in 2022 and 2023 respectively, combined with the experience and skill-sets of the existing Directors, that the Board was able to fulfil its duties through to the end of the reporting period with its existing composition. It is the intention of the Nominations Committee to meet during the current reporting period. \n   \n \n Geoff Wicks \n Chairman and Non-Executive Director \n 9 September 2025 \n   \n \n \n Corporate Governance (continued) \n   \n Audit Committee report \n   \n The Audit Committee is responsible for ensuring that the financial position of the Group is properly monitored. The Audit Committee generally meets twice a year and the Finance Director of the trading subsidiary, appointed to lead the finance function,  also attends by invitation. The Committee meets with the Group & Company Independent Auditor (\"Auditor\") at least twice during the annual year-end audit and has direct access to the Auditor at any time throughout the year. At 30 June 2025, the members of the Audit Committee were: \n   \n Raj Nagevadia (Chairman) \n Geoff Wicks \n Matthew Jeffs \n   \n   \n Objectives and responsibilities \n   \n The role of the Audit Committee is to primarily monitor the Group's financial statements, the effectiveness of financial controls and systems and to oversee the relationship with external auditors. \n   \n   \n Activities of the Audit Committee during the year \n   \n The Audit Committee focuses on financial reporting and the statutory audit, and the assessment of internal controls. The Committee reviewed the treasury mandate to ensure achieving a market rate of return on existing cash balances, and banking relationships to ensure that appropriate day-to-day banking facilities were in place to support its ability to execute operational activities. \n   \n   \n Financial reporting and statutory audit \n   \n The Audit Committee reviews the half year and annual financial statements with emphasis on: \n -       the overall truth and fairness of the results and financial position; \n -       the transparency and understandability of the accounts for users; \n -       the appropriateness of the accounting policies; \n -       the resolution of management's significant accounting judgements or of matters raised by the external auditors; \n -       the quality of the Annual Report as a whole. \n The Audit Committee considers that the Annual Report taken as a whole is fair, balanced and understandable. \n   \n   \n Accounting policies, practices and judgements \n   \n   \n \n \n \n \n Issue \n \n \n Action \n \n \n \n \n \n \n \n ·       Accounting policies \n \n \n \n The Committee reviewed and discussed the significant accounting policies with management and the external auditor and reached the conclusion that each policy was appropriate to the Group. \n \n \n \n \n \n ·       Going concern review \n \n \n \n The Committee considered the ability of the Group to operate as a Going Concern considering cash flow forecast for the 12 months from the date of signing this report, and milestone achievements. It was determined by the Committee that it was reasonable to expect that the Group has or will have sufficient funds for the next 12 months and that it was appropriate for the Financial Statements to be prepared on a going concern basis. \n \n \n \n \n   \n   \n \n   \n Corporate Governance (continued) \n   \n Audit Committee report (continued) \n   \n   \n \n \n \n \n Issue \n \n \n Action \n \n \n \n \n \n ·       Review of audit and non-audit services and fees \n \n \n \n The external auditor is not engaged by the Group to carry out any non-audit work in respect of which it might, in the future, be required to express an audit opinion. The Committee reviewed the fees charged for the provision of audit and non-audit services and determined that they were in line with fees charged to companies of similar size and stage of development. \n The Committee considered and was satisfied the external auditor's assessment of its own independence. \n \n \n \n \n   \n   \n Internal audit \n   \n The Group does not have internal auditors as the Audit Committee considers that it is not yet of a size or complexity to necessitate this. \n   \n   \n   \n   \n Raj Nagevadia \n Audit Committee Chairman \n 9 September 2025 \n \n \n Corporate Governance (continued) \n   \n Remuneration Committee report \n   \n Dear shareholder \n   \n I am pleased to introduce the Directors' Remuneration Report for the year ended 30 June 2025. \n   \n The Chairman's Statement on page 2 provides a summary of the progress the Group has made during the financial year. The Remuneration Committee is committed to structuring executive remuneration that supports the Group's strategy and performance and to help it grow profitably. The Remuneration Committee is appointed by the Board and comprises the two independent Non-Executive Directors. \n   \n Short-term performance is incentivised by an annual bonus scheme based on the achievement of certain financial performance targets. Long-term performance is incentivised by the Group's Share Option Scheme. \n   \n Directors' Remuneration Policy \n   \n This part of the Directors' Remuneration Report sets out the Group's remuneration policy. \n   \n Policy on Executive Remuneration \n   \n The Group's remuneration policy is designed to ensure that the Company is able to attract, motivate and retain executives and senior management to promote long-term success. The retention of key management and the alignment of management incentives with the creation of shareholder value are key objectives of this policy. \n   \n The Remuneration Committee seeks to ensure that salaries are market competitive for similar companies. \n   \n \n \n   \n Corporate Governance (continued) \n   \n Remuneration Committee report (continued) \n   \n Key elements of Remuneration (continued) \n   \n \n \n Corporate Governance (continued) \n   \n Remuneration Committee report (continued) \n   \n Key elements of Remuneration (continued) \n   \n \n \n   \n \n Alignment of Executive Remuneration and the Market \n   \n The Remuneration Committee takes advantage of the availability of various annual AIM Directors' Remuneration reports as well as available data about similar companies. The Company aims to ensure that Directors' salaries are set at a level sufficient to ensure there is significant incentive and regard for better than average long-term results. \n   \n Consideration of Employee Pay \n   \n The Remuneration Committee takes account of pay and conditions of employees throughout the Group when setting pay and benefits for Executive Directors. The Company endeavours to provide competitive remuneration packages for all employees. Employees may be eligible to participate in the Share Option Scheme at the discretion of the Remuneration Committee. The Company does not consult directly with its employees as part of the process for determining Executive pay. \n   \n Policy on recruitment \n   \n When appointing new Executive Directors, the Remuneration Committee will consider their remuneration by reference to the Remuneration Policy set out in this Report. The Remuneration Committee would not usually expect to pay sign-on payments or compensate new Directors for any variable remuneration forfeited from any employment prior to joining the Board other than in exceptional circumstances, recognising that the Company needs to attract appropriately skilled and experienced individuals. \n Corporate Governance (continued) \n   \n Remuneration Committee report (continued) \n   \n Policy on recruitment (continued) \n   \n Salary and annual bonus will be set so as to be competitive with comparable companies and also taking into account the experience, seniority and responsibility of the appointee coming into the new role. New Executive Directors will receive benefits and pension contributions in line with the Company's existing policy and to participate in the annual bonus scheme on a pro-rated basis for the portion of the financial year for which they are in post. \n   \n   \n Policy on Loss of Office \n   \n Executive Directors leaving employment from the Group, other than in circumstances of gross misconduct or incompetence, serious dishonesty or wilful neglect of duty (in which cases no amount will be payable), will be entitled to receive salary in accordance with their notice periods and pro-rated annual bonus to the date of leaving. The notice periods and the contractual rights on termination of each Director are set out below. The Company's Employee Share Option Scheme also provides leaver provisions as follows: \n   \n An Executive Director who ceases to be a Director or employee of the Group by reason of death, retirement, ill-health, injury or disability, redundancy or the sale of the company for which they work will be a good leaver. As such they will be permitted to exercise their options. Where the cessation is on any other grounds the awards will lapse on the date of cessation, unless the Remuneration Committee determines at its discretion prior to the date of cessation that the awards shall vest. \n   \n Share option awards held by good leavers that are already capable of being exercised at the date of cessation may, at the discretion of the Remuneration Committee, be exercised up to 12 months of the leaving date (depending on the reason for leaving). If the good leaver ceases to be an employee or Director before the end of the third anniversary of the grant of the award it may, at the discretion of the Remuneration Committee, be allowed to vest on the normal vesting date. \n   \n   \n External appointments \n   \n It is the Board's policy to allow Executive Directors to accept directorships of other quoted and non-quoted companies provided that they have obtained the consent of the Chairman of the group. Any such directorships must be formally notified to the Board. \n   \n   \n Policy on Non-Executive Director Remuneration                                                                \n   \n The remuneration of the Chairman and the other Non-Executive Director comprises fees that are paid via the payroll. The Non-Executive Directors no longer participate in the Company's Share Option Scheme. Fees are reviewed annually. The Non-Executive Directors are not involved in any decisions about their own remuneration. No additional fees are payable to the chairmen of the Audit and Remuneration Committees. \n   \n \n   \n Corporate Governance (continued) \n   \n Remuneration Committee report (continued) \n   \n Directors' Service Agreements \n   \n \n Non-Executive Directors' Letters of Appointment \n   \n The Non-Executive Directors have Letters of Appointment stating that their appointment is for an initial term up until they are required to retire by rotation. The Letters of Appointment provide for termination of the appointment on three months' notice by either party. \n   \n The current Non-Executive Directors' appointments commenced on the following dates: \n   \n Geoff Wicks                                                                                                                                                            20 July 2020 \n Raj Nagevadia                                                                                                                                                   26 October 2022 \n   \n Annual Report on Remuneration \n   \n Introduction \n The Annual Report on Remuneration sets out information about the remuneration of the Directors of the Company for the year ended 30 June 2025. \n   \n Remuneration Committee \n The Remuneration Committee consisted of the following Directors at 30 June 2025: \n   \n Geoff Wicks, Independent Non-Executive Director and Chairman of the Board \n Raj Nagevadia (Chairman), Independent Non-Executive Director \n   \n Role of the Remuneration Committee \n The Remuneration Committee assists the Board in determining the remuneration and benefits package for the Executive Directors. \n   \n Activities of the Remuneration Committee during the year \n   \n The Remuneration Committee meets whenever it is appropriate. The committee met two times in the current year. In addition to agreeing the remuneration report and reviewing the remuneration of the Executive Directors, the award of share options to Directors and Employees was approved.   \n   \n \n Corporate Governance (continued) \n   \n Remuneration Committee report (continued) \n   \n Directors' Remuneration \n The detailed emoluments of the Executive and Non-Executive Directors are set out below. \n   \n   \n   \n Year ended 30 June 2025 \n   \n   \n \n \n \n \n \n \n \n Salary/fees \n \n \n Benefits \n \n \n Bonus \n \n \n Pension \n \n \n Total \n \n \n \n \n Chairman and Non-Executive Directors \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Geoff Wicks (Chairman) \n \n \n 32,500 \n \n \n - \n \n \n - \n \n \n - \n \n \n 32,500 \n \n \n \n \n Raj Nagevadia \n \n \n 25,000 \n \n \n - \n \n \n - \n \n \n - \n \n \n 25,000 \n \n \n \n \n Total Non-Executive \n \n \n 57,500 \n \n \n - \n \n \n - \n \n \n - \n \n \n 57,500 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Executive Directors \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Matthew Jeffs \n \n \n 198,450 \n \n \n 3,406 \n \n \n 82,701 \n \n \n 5,953 \n \n \n 290,510 \n \n \n \n \n Total Executives \n \n \n 198,450 \n \n \n 3,406 \n \n \n 82,701 \n \n \n 5,953 \n \n \n 290,510 \n \n \n \n \n Total Remuneration \n \n \n 255,950 \n \n \n 3,406 \n \n \n 82,701 \n \n \n 5,953 \n \n \n 348,010 \n \n \n \n \n   \n   \n   \n Analysis of bonuses & pension: \n                                                                                      Bonuses          Bonuses                 Paid               Total                                                                                      accrued   paid as cash      as pension                         \n \n Directors                                                                                   \n \n Matthew Jeffs                                                                           \n Year ended 30 June 2024                                          77,930          (77,930)                        -                        - \n \n Year ended 30 June 2025                                          82,701                        -               5,953            88,654 \n \n \n \n   \n   \n Year ended 30 June 2024 \n   \n   \n \n \n \n \n \n \n \n Salary/fees \n \n \n Benefits \n \n \n Bonus \n \n \n Pension \n \n \n Total \n \n \n \n \n Chairman and Non-Executive Directors \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Geoff Wicks (Chairman) \n \n \n 32,500 \n \n \n - \n \n \n - \n \n \n - \n \n \n 32,500 \n \n \n \n \n Raj Nagevadia \n \n \n 25,000 \n \n \n - \n \n \n - \n \n \n - \n \n \n 25,000 \n \n \n \n \n Total Non-Executive \n \n \n 32,500 \n \n \n - \n \n \n - \n \n \n - \n \n \n 32,500 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Executive Directors \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Matthew Jeffs \n \n \n 183,750 \n \n \n 3,185 \n \n \n 77,930 \n \n \n 5,512 \n \n \n 270,377 \n \n \n \n \n Total Executives \n \n \n 183,750 \n \n \n 3,185 \n \n \n 77,930 \n \n \n 5,512 \n \n \n 270,377 \n \n \n \n \n Total Remuneration \n \n \n 241,250 \n \n \n 3,185 \n \n \n 77,930 \n \n \n 5,512 \n \n \n 327,877 \n \n \n \n \n   \n   \n \n Corporate Governance (continued) \n   \n Remuneration Committee report (continued) \n   \n Directors' Remuneration (Continued) \n   \n Directors' share interests \n   \n The number of ordinary shares of the Company in which the Directors were beneficially interested at 30 June 2025 was: \n   \n \n Director                                                                                                                                                30 June 2025      30 June 2024 \n \n Geoff Wicks                                                                                                                                                                  -                              -       \n Raj Nagevadia                                                                                                                                                             -                              - \n \n Matthew Jeffs                                                                                                                                              1,013,000                935,000       \n \n                                                                                                                                                                                           \n   \n Directors' share options interests \n   \n \n Director              At 1 July 2024           Granted                  Lapsed        At 30 June 2025                Exercise                  Normal exercise \n                                                                                                                                                                               price                                    period \n \n Geoff Wicks                     30,000                        -                              -                         30,000       164.50 pence          30 Jun 23 - 2 Oct 30 \n Matthew Jeffs                100,000                       -                              -                       100,000       110.00 pence        30 Jun 21 - 29 Jun 28 \n \n                                             50,000                        -                              -                         50,000       130.50 pence        30 Jun 24 - 11 Oct 31 \n                                             50,000                        -                (50,000)                                     -         76.50 pence        30 Jun 25 - 21 Oct 32 \n \n   \n   \n There are no performance conditions on the exercise of the options granted prior to 1 July 2018. There were no options granted to directors during the year to 30 June 2025. \n   \n   \n * Fully diluted earnings will be based on: (a) the Company's pre-tax profit excluding exceptional items and the share option charge and (b) the current UK corporation tax rate of 19%, such that the fully diluted earnings calculation takes no account of R&D and deferred tax credits. For the purposes of the fully diluted earnings calculation, the applied rate of corporation tax will remain constant at 19% irrespective of any current or future changes to corporation tax. \n   \n   \n   \n Raj Nagevadia \n Remuneration Committee Chairman \n 9 September 2025 \n \n \n Directors' Report \n   \n The Directors present their Report and financial statements for the year ended 30 June 2025 . \n   \n General information \n   \n Arcontech Group plc is a public limited company which is listed on the AIM segment of the London Stock Exchange and is incorporated in the United Kingdom. \n   \n Results and dividends \n   \n Details of the results for the year are given on page 28. The Directors recommend the payment of a final dividend of 4.00 pence per ordinary share (2024: 3.75 pence per share) to be paid on 31 October 2025 to ordinary shareholders on the register on 3 October 2025 £534,912 (2024: £501,480). \n   \n Directors \n   \n The Directors who have held office during the period from 1 July 2024 to the date of this report are as follows: \n   \n Geoff Wicks \n Matthew Jeffs      \n Raj Nagevadia \n   \n Refer to page 18 for details of the remuneration paid to each Director for the years to 30 June 2025 and 2024. \n   \n Raj Nagevadia, who retires by rotation under Article 106 of the Company's articles of association and, who being eligible, offers himself to be re-elected as a Director of the Company. \n   \n Except as disclosed in note 23 to the financial statements none of the Directors had an interest in any contracts with the Company or its subsidiaries during the year. \n   \n Employees \n   \n The Directors recognise the importance of good communication with employees to ensure a common awareness of factors affecting the Group. They also recognise their statutory responsibilities. Matters of current concern or interest are discussed with staff on a regular basis. \n   \n Internal control \n   \n The Directors acknowledge their responsibilities for the Group's system of internal control. The Board considers major business and financial risks. All strategic decisions are referred to the Board, which meets monthly, for approval. Accepting that no system of control can provide absolute assurance against material misstatement or loss, the Directors believe that the established systems of internal control within the Group are appropriate to the business. \n   \n Future developments \n   \n Interest in our products is higher than we have seen for some time and we are optimistic that this will drive future revenue growth over the coming years. \n   \n Financial risk management \n   \n T he G r o u p ' s f i n a nc i al i ns t r u m e n t s co m p r i se cash a n d cash e qu i v a l e n t s, a n d i t e m s s uch as t r a de p ay a b l es a nd t r a d e r e c e i v a b l es, w h i ch a r i se d i r ec t l y f r om i t s o pe r a t i o ns. \n   \n The main risks arising from the Group's financial instruments are interest rate fluctuations and liquidity risk. Refer to Note 25 for further detail on the Group's financial instruments and risk exposures. It is the Group's policy to finance its operations through a mixture of cash and, where appropriate, external finance and to review the projected cash flow requirements of the Group with an acceptable level of risk exposure. \n   \n   \n   \n   \n   \n Directors' Report (continued) \n   \n Going concern \n   \n On the basis of current projections and having regard to the Group's existing cash reserves, the Directors consider that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, the Directors have adopted the going concern basis in the preparation of the financial statements (Refer to Note 1). \n   \n Research and Development \n   \n The Group continues to make progress in product development, while continuing to keep control of costs. Research and development expenditure is charged to the income statement in the year incurred, unless it meets the capitalisation criteria under IAS 38. \n   \n Directors' and Officers' Liability Insurance \n   \n Directors' and Officers' liability insurance is in place at the date of this report. The Board remains satisfied that an appropriate level of cover is in place and a review of cover takes place annually. \n   \n Disclosures to auditors \n   \n In the case of each of the persons who are Directors at the time when the report is approved, the following applies: \n -       so far as each of the Directors are aware, there is no relevant audit information of which the Company's auditors are unaware; and \n -       each of the Directors have taken all the steps that they ought to have taken as Directors in order to make themselves aware of any relevant audit information and to establish that the Company's auditors are aware of that information. \n   \n   \n This information is given and should be interpreted in accordance with the provisions of s418 of the Companies Act 2006. \n   \n Independent Auditors \n   \n A resolution to re-appoint PKF Littlejohn LLP will be proposed at the annual general meeting. \n   \n On behalf of the Board \n   \n   \n   \n Matthew Jeffs \n Chief Executive \n 9 September 2025 \n \n \n Statement of Directors' Responsibilities \n   \n The Directors are responsible for preparing the Strategic Report, Directors' Report and the financial statements in accordance with applicable UK law and regulations. \n   \n Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with UK-adopted international accounting standards (UK IAS) and as regards the Company financial statements, as applied in accordance with the requirements of the Companies Act 2006. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the Group and of the profit or loss of the Group for that period. In preparing these financial statements, the Directors are required to: \n   \n -       select suitable accounting policies and then apply them consistently; \n -       make judgments and accounting estimates that are reasonable and prudent; \n -       state whether they comply with UK-adopted international accounting standards, subject to any material departures disclosed and explained in the financial statements; and \n -       prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business. \n   \n The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. \n   \n The Directors are responsible for ensuring that they meet their responsibilities under the AIM rules. \n   \n The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. \n   \n \n \n Independent Auditor's Report to the members of \n Arcontech Group PLC \n   \n Opinion \n We have audited the financial statements of Arcontech Group Plc (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 June 2025 which comprise the Group Income Statement and Statement of Comprehensive Income, the Statements of Changes in Equity, the Statements of Financial Position, the Group and Parent Company Statements of Cash Flows, and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and UK-adopted international accounting standards and as regards the parent company financial statements, as applied in accordance with the provisions of the Companies Act 2006. \n In our opinion: \n ·      the financial statements give a true and fair view of the state of the group's and of the parent company's affairs as at 30 June 2025 and of the group's profit for the year then ended; \n ·      the group financial statements have been properly prepared in accordance with UK-adopted international accounting standards; \n ·      the parent company financial statements have been properly prepared in accordance with UK-adopted international accounting standards and as applied in accordance with the provisions of the Companies Act 2006; and \n ·      the financial statements have been prepared in accordance with the requirements of the Companies Act 2006. \n Basis for opinion \n We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. \n Conclusions relating to going concern \n In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors' assessment of the group's and parent company's ability to continue to adopt the going concern basis of accounting included a review of: key inputs to the forecast financial information prepared by management for the period up to 30 September 2026; management's assessment of going concern; and relevant post year end information such as regulatory news announcements, Board minutes, and year to date financial information. We have challenged the applicable assumptions and key estimates and obtained an understanding of the key assumptions used to prepare this information as follows: \n ·      Agreeing inputs (including contracted and committed expenditures) to underlying supporting documentation; \n ·      Ensuring the calculations applied in the forecast are mathematically accurate; \n ·      Comparison of forecasts with recent historical financial information to consider accuracy of forecasting; \n ·      Comparing forecasts to actual post year-end cash levels through agreement to bank statements; and \n ·      Stress-testing the forecasts to consider the impact of reasonably possible changes to key assumptions such as revenue projections and operational costs. \n Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's or parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. \n Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. \n   \n \n Independent Auditor's Report to the members of \n Arcontech Group PLC (continued) \n   \n Our application of materiality \n \n \n \n \n Materiality \n \n \n Performance Materiality \n \n \n Basis for materiality \n \n \n \n \n Group: £47,000 \n (2024: £58,200) \n Company: £22,000 \n (2024: £57,600) \n \n \n Group: £35,000 \n (2024: £43,650) \n Company: £17,000 \n (2024: £43,200) \n \n \n 1.5% of revenue; performance materiality at 75% \n   \n 2% of total assets (capped at a level below group materiality); performance materiality at 75% \n \n \n \n \n   \n We consider revenue to be the most significant determinant of the group's financial position and performance used by shareholders as this drives profitability. The going concern of the group is dependent on its ability to continue to generate profits through revenue growth. We consider assets to be the key determinant of the parent company's financial position as its underlying value is derived from the recoverability of its investment in the main trading subsidiary, Arcontech Limited. An asset basis for the parent company is considered most appropriate given this entity is not revenue generating but holds key assets including cash and investments in subsidiaries. \n Whilst materiality for the group financial statements as a whole was set as £47,000 (2024: £58,200), materiality for the parent company was set at a level of £22,000 (2024: £57,600) and materiality for the main trading company, being the only other material component, was set at a level of £44,000 (2024: £57,600), with performance materiality set at 75% (2024: 75%) for group and both material components, a threshold considered appropriate for a group of this size and inherent risk profile. We applied the concept of materiality both in planning and performing our audit, and in evaluating the effect of misstatements. \n We agreed with the audit committee that we would report to the committee all audit differences identified during the course of our group and parent company audits in excess of £2,000 (2024: £2,910) as well as differences below these thresholds that, in our view, warranted reporting on qualitative grounds, as well as disclosure matters that we identified when assessing the overall presentation of the financial statements. \n We applied the concept of materiality both in planning and performing our audit, and in evaluating the effect of misstatement. Materiality is reassessed throughout the audit. The materiality threshold for both the group and the parent company has not changed since the audit planning stage. \n Our approach to the audit \n In designing our audit, we determined materiality and assessed the risk of material misstatement in the financial statements. In particular, we looked at areas requiring the directors to make subjective judgements, for example in respect of assessing the carrying value and recoverability of investments in subsidiaries (including intragroup receivables) at parent company level and goodwill at group level, the valuation of share-based payments, recoverability of deferred tax assets and the consideration of future events that are inherently uncertain. We also addressed the risk of management override of internal controls, including evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud. \n We considered revenue recognition to be a key audit matter and designed our audit procedures to address the risk of misstatement of revenue, including consideration of key contractual terms within customer agreements and whether recognition is therefore in accordance with IFRS 15 Revenue from Contracts with Customers . \n An audit was performed on the financial information of the group's material components which, for the year ended 30 June 2025, were located in the United Kingdom. All work was performed by PKF Littlejohn LLP in London. \n We identified what we considered to be key audit matters in the next section and planned our audit approach accordingly. \n \n \n   \n Independent Auditor's Report to the members of \n Arcontech Group PLC (continued) \n   \n Key audit matters \n Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. \n \n \n \n \n Key Audit Matter \n \n \n How our scope addressed this matter \n \n \n \n \n Revenue recognition (see Note 1 - Revenue Recognition policy and Note 3) \n \n \n   \n \n \n \n \n The group generates sales from the licensing of its proprietary software, which delivers real time market data information tailored to customer requirements, as well as support and maintenance services. \n Under IFRS 15 Revenue from Contracts with Customers , a key consideration for the Group is whether the performance obligation/s within their licensing arrangements are met at a point in time or over time. \n As certain revenue streams can be recognised at a point in time whilst others have to be recognised over time, and the identification of the differing contract types and obligations therein is judgemental, there is a risk that revenue is materially misstated and the terms of the contracts with customers including the performance obligations therein have not been appropriately accounted for in accordance with IFRS 15.  \n Given the audit time spent in this area, and the management judgement required in the identification of the differing contract types and obligations therein, revenue recognition is considered to be a key audit matter. \n \n \n Our work in this area included: \n ·      Updating our documentation of the systems and controls in place surrounding its material revenue streams, being fees from fixed and floating licences and related support and maintenance services; \n ·      Performing walkthrough tests to confirm our understanding of the internal control environment in operation surrounding revenue; \n ·      Reviewing the accounting treatment in respect of revenue recognition in accordance with IFRS 15 by reference to key contractual terms and concluding as to the appropriateness of the accounting treatment; \n ·      Substantive transactional testing of income recognised in the financial statements, including testing of deferred and accrued income balances; \n ·      Reviewing post year end receipts to ensure completeness of income recorded in the accounting period; and \n ·      Review of disclosures surrounding revenue in the financial statements to ensure compliance with IFRS 15. \n \n \n \n \n   \n Other information \n The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the group and parent company financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. \n We have nothing to report in this regard. \n Independent Auditor's Report to the members of \n Arcontech Group PLC (continued) \n   \n Opinions on other matters prescribed by the Companies Act 2006 \n In our opinion, based on the work undertaken in the course of the audit: \n ·      the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and \n ·      the strategic report and the directors' report have been prepared in accordance with applicable legal requirements. \n   \n Matters on which we are required to report by exception \n In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report. \n We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: \n ·      adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or \n ·      the parent company financial statements are not in agreement with the accounting records and returns; or \n ·      certain disclosures of directors' remuneration specified by law are not made; or \n ·      we have not received all the information and explanations we require for our audit. \n   \n Responsibilities of directors \n As explained more fully in the Statement of Directors' Responsibilities, the directors are responsible for the preparation of the group and parent company financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. \n In preparing the group and parent company financial statements, the directors are responsible for assessing the group and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so. \n   \n Auditor's responsibilities for the audit of the financial statements \n Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. \n Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: \n ·      We obtained an understanding of the group and parent company and the sector in which they operate to identify laws and regulations that could reasonably be expected to have a direct effect on the financial statements. We obtained our understanding in this regard through discussions with management and industry experience. We also selected a specific audit team based on experience with auditing entities within this industry facing similar audit and business risks. \n ·      We determined the principal laws and regulations relevant to the group and parent company in this regard to be those arising from: \n Independent Auditor's Report to the members of \n Arcontech Group PLC (continued) \n   \n o  Companies Act 2006; \n o  AIM Rules; \n o  UK employment law; and \n o  UK tax laws and regulations. \n ·      We designed our audit procedures to ensure the audit team considered whether there were any indications of non-compliance by the group and parent company with those laws and regulations. These procedures included, but were not limited to: \n o  Making enquiries of management regarding potential instances of non-compliance; \n o  Reviewing Board minutes during the year and post-year end; \n o  Reviewing the legal and professional fee ledger accounts; and \n o  Reviewing Regulatory News Service announcements during the year and post-year end. \n ·      We also identified the risks of material misstatement of the financial statements due to fraud. Aside from the non-rebuttable presumption of a risk of fraud arising from management override of controls, we also considered there to be a risk of fraud related to revenue recognition. This has been addressed as described within the Key audit matters section above. \n ·      As in all of our audits, we addressed the risk of fraud arising from management override of controls by performing audit procedures which included, but were not limited to: the testing of journals, reviewing accounting estimates for evidence of bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business. \n Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. \n A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities . This description forms part of our auditor's report. \n Use of our report \n This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone, other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. \n \n   \n Imogen Massey (Senior Statutory Auditor)                                                                                                      15 Westferry Circus \n For and on behalf of PKF Littlejohn LLP                                                                                                                  Canary Wharf \n Statutory Auditor                                                                                                                                                         London E14 4HD \n 9 September 2025 \n   \n \n \n   \n                                                                                                                                                                                                                          \n                                                  \n Group Income Statement and Statement of Comprehensive Income \n   \n For the year ended 30 June 2025 \n   \n   \n \n \n \n \n \n \n \n Note \n \n \n   \n   \n   \n   \n \n \n \n \n \n 2025 \n   \n \n \n \n \n \n   \n 2024 \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n £ \n \n \n \n \n \n £ \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Revenue \n \n \n 3 \n \n \n \n \n \n \n \n \n 3,106,991 \n \n \n \n \n \n 2,910,232 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Administrative costs \n \n \n \n \n \n \n \n \n \n \n \n (2,328,438) \n \n \n \n \n \n (2,040,541) \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n   \n Operating profit \n \n \n 4 \n \n \n \n \n \n \n \n \n 778,553 \n \n \n \n \n \n 869,691 \n \n \n \n \n   \n Net finance income \n \n \n 5 \n \n \n \n \n \n \n \n \n 208,837 \n \n \n \n \n \n 229,268 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n   \n Profit before taxation \n \n \n \n \n \n \n \n \n \n \n \n 987,390 \n \n \n \n \n \n 1,098,959 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n   \n Taxation \n \n \n 9 \n \n \n \n \n \n \n \n \n (43,960) \n \n \n \n \n \n (31,302) \n \n \n \n \n   \n Profit for the year after tax \n \n \n \n \n \n \n \n \n \n \n \n 943,430 \n \n \n \n \n \n 1,067,657 \n \n \n \n \n   \n Total comprehensive income for the year \n \n \n \n \n \n \n \n \n \n \n \n 943,430 \n \n \n \n \n \n 1,067,657 \n \n \n \n \n   \n   \n Earnings per share (basic) \n \n \n 10 \n \n \n \n \n \n   \n   \n \n \n 7.05p \n \n \n \n \n \n 7.98p \n \n \n \n \n   \n Adjusted* Earnings per share (basic) \n \n \n 10 \n \n \n \n \n \n \n \n \n 6.70p \n \n \n \n \n \n 7.80p \n \n \n \n \n   \n Earnings per share (diluted) \n \n \n 10 \n \n \n \n \n \n   \n   \n \n \n 7.02p \n \n \n \n \n \n 7.96p \n \n \n \n \n   \n \n \n \n \n Adjusted* Earnings per share (diluted) \n \n \n 10 \n \n \n \n \n \n \n \n \n 6.67p \n \n \n \n \n \n 7.78p \n \n \n \n \n   \n   \n *Adjusted to exclude the release of accruals for administrative costs relating to prior years of £47,611 (2024: £24,603). This is a non-IFRS alternative performance measure that the Board considers to be a more accurate indicator of underlying trading performance. This measure has been adopted as a KPI and is disclosed in the Strategic Report on page 4. \n   \n All of the results relate to continuing operations. \n   \n There was no Other Comprehensive Income other than Profit for the year after tax for the year under review (2024: nil). \n   \n \n   \n The notes on pages 33 to 5...

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