Dc Holdings (Lincoln) Limited

We aim to present a balanced and comprehensive view of the development and performance of our business during the period and its position at the period end. Our review is consistent with the size and non-complex nature of our business and is written in the context of the risks and uncertainties we face. Business Review The group continues to manufacture and wholesale a range of animal health and equestrian products. During 2025 we have continued to increase our product range whilst maintaining a keen eye on phasing out low margin and slow moving products in order to release cash from working capital. We consider our key financial performance indicators to be those that communicate the financial performance and strength of the group as a whole, in particular turnover, gross margin, reported operating margin and debt service. These indicators are reviewed via monthly management accounts. We have reported a small decrease in turnover of 2.8% to £21.3m in 2025. The gross margin percentage has improved from 16.2% to 16.9% in the current year. The group continues to operate comfortably within all of its banking covenants. Demand for our products has remained strong as has our customers' ability to pay. Our supply chain has remained resilient with only minor disruptions. Cash generation has remained strong and our bankers remain supportive. Future Developments On 6 February 2026 DC Holdings (Lincoln) Limited acquired 100% of the issued share capital of Trilanco Ltd. This significantly strengthens the group's position in the equestrian and animal health markets and greatly improves our prospects and our opportunities. Credit Risk The Directors seek to manage credit risk by dealing with established customers or otherwise checking the credit-worthiness of new customers, establishing clear contractual relationships with those customers and by identifying and addressing any credit issues arising in a timely manner. Currency Risk The Directors minimise the risk to foreign currency fluctuations by invoicing and purchasing in sterling where possible. Liquidity Risk The Directors seek to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably. Interest Rate Risk The exposure to the risk of changes in interest rates relates primarily to bank borrowings. The Directors seek to manage this risk by the use of a combination of variable and fixed rates. Supply Chain Risks In common with all similar businesses, we are experiencing continued challenges in our global supply chain affecting availability of product and cost. Every effort is being made to mitigate the impact on prices and maintain product availability. As for many businesses of our size, the business environment in which we operate continues to be challenging with good levels of competition from other wholesalers and manufacturers. We are of course subject to the vagaries of weather, to consumer spending patterns and consumers' overall levels of disposable income within our economy. The strength of our offering is in our ability to meet the needs of our customers and alongside this, the continued increase in our customer base forms an effective means of managing economic risk in the current environment. Our key financial risk is the ability to continue to generate and access sufficient funds to pay down debt and satisfy our ongoing business requirements. With these risks and uncertainties in mind, we are aware that any plans for the future development of the business may be subject to unforeseen future events outside of our control. However in terms of what we can foresee at present, we remain very confident in the prospects of the business and have enjoyed good results so far in 2026.