Sunsynk UK Ltd

The principal activity of the company continued to be the distribution of hybrid inverters and associated accessories, including batteries, used in the renewable energy sector. Results, performance and developments during the year Revenue levels in the year to March 2025 at £13.5m were slightly lower than the in the prior year (£13.7m), whilst gross profit margins increased from 18.0% to 28.2%. These margins improvements were in line with expectations following the pricing pressure in the period to March 2024 which had diluted overall margins. There has been a large increase in distribution costs in the current year following a relocation to improve our customer service, whilst Administrative expenses also show a sharp increase as we relocated many of our group functions from Hong Kong to the UK. We remain confident in the long term fundamentals of the market and have continued to invest in our infrastructure during the year, building teams who can deliver further growth and maintain our market leading position. Principal risks and uncertainties The directors consider that the key risks and principal uncertainties faced by the company are: products cost price volatility, exchange rate variances and supply chain distribution. These risks are managed through monitoring of the appropriate markets, the use of forward contracts and currency hedges, maintaining close relationships and multiple sourcing of key resources. Financial instruments Due to the nature of the financial instruments used by the company there is no material exposure to price risk. The company's approach to managing other risk applicable to the financial instruments concerned are shown below. In respect of bank balances the liquidity risk is managed by maintaining a balance between the continuity of funding and flexibility through the control of credit terms. Trade debtors are managed in respect of credit and cash flow by policies concerning the credit offered to the customers and the regular monitoring of amounts outstanding for both time and credit limits. Trade creditors liquidity risk is managed by ensuring sufficient funds are available to meet amounts due. Performance indicators Key performance indicators monitored by management include order in-take, gross margin, stock volumes and cash collection. The market is challenging with a cost of living crisis and high energy costs leading to a severe lack of customer confidence. We remain confident that we are on the right path to support our customers with continued product development and a focus on after sales support. We continue to work with all customers, offering weekly order reports, order book transparency and stock management support to ensure deliveries arrive on time. Our internal research and development, inspections and quality assurance teams ensure our products are consistently of the highest quality to avoid production issues and reduce waste. As a group we have extended our number of suppliers in China to spread out our risk in one basket, speed up production time and reduce waste within the supply chain.