Annual Financial Report

Law Debenture Corp PLC

11 March 2026

 

The Law Debenture Corporation p.l.c.

11 March 2026

Strong Performance in 2025

The Law Debenture Corporation p.l.c. ("Law Debenture" or the "Company") today published its results for the year ended 31 December 2025.

2025 was a very pleasing year for Law Debenture. We continue to perform strongly against our objective of achieving long-term capital growth in real terms and steadily increasing income, with outperformance over 1, 3, 5 and 10 years.

	1 year %	3 years %	5 years %	10 years %
NAV total return (with debt at par)1	29.2	58.6	78.8	184.5
NAV total return (with debt at fair value)1	28.4	59.1	96.6	200.8
FTSE Actuaries All-Share Index Total Return2	24.0	46.5	73.9	123.4
Share price total return2	22.2	53.1	85.0	212.4
Change in Retail Price Index3	3.4	13.2	37.3	55.6

Past performance cannot be relied on as a guide to future performance. The value of investments and any income from them can go down as well as up. Your capital is at risk.

Highlights of 2025

·	Net asset value (NAV) total return with debt and Independent Professional Services ("IPS") business at fair value outperformed the FTSE Actuaries All-Share Index by over 4% with a total return of 28.4% in FY25 (29.2% with debt at par).
·	Share price total return of 22.2% for 2025, ahead of the UK Equity Income weighted average of 20%.
·	A solid performance from IPS, with net revenue increasing by 7.5%, underlying profit before interest and tax up by 6.1% and valuation up 7.3% to £208.7 million (excluding net assets).
·	The Company issued 1.3 million new Ordinary Shares at a premium to NAV during 2025 with net proceeds of £11.6 million.

Strong Long-Term Record

·	Consistent NAV (with IPS and debt at fair value) outperformance of the benchmark over one, three, five and ten years.
·	Share price total return over 10 years of 212.4% (FTSE All-Share: 123.4%) which compares favourably with UK Equity Income peers.
·	Law Debenture has outperformed the FTSE All-Share Index (Total Return) weighted average return in 21 of the past 26 years.

Dividend

·	Proposed final dividend of 10.375 pence per Ordinary Share.
· ·	Total annual dividend of 35.5 pence, fully covered by Group revenue return per share of 37.26 pence. 47 years of increasing or maintaining dividends - with increases in 46 years. Dividend yield of 3.1% based on our closing share price of 1,132 pence on 10 March 2026.

Investment Portfolio

·	Portfolio managed by James Henderson and Laura Foll of Janus Henderson. The aim is to achieve a higher rate of total return than the FTSE Actuaries All-Share Index Total Return through investing in a diversified portfolio of stocks.
· · ·	Almost 90% UK weighting, with blend of large, medium and small capitalisation stocks. Revenue from IPS allows portfolio to include attractive no or low yielding stocks. Net capital gain on investments of £262.7 million (FY24: £76.3 million).
·	Dividend income from the portfolio of £40.3 million (FY24: £34.7 million).
·	Total ongoing charges of 0.56% 4.

IPS

·	The Company's wholly-owned provider of professional services is a key differentiator to other investment trusts and offers additional portfolio flexibility.
·	Accounts for 16% of 2025 NAV but has funded approximately one-third of dividends in the last 10 years.
·	IPS has delivered eight consecutive years of mid to high single digit growth, with net revenues of £57.7 million (FY24: £53.7m) up 7.5% with underlying profit before interest and tax up by 6.1%.

Robert Hingley, Chairman, said:

"I am very pleased with the performance Law Debenture has delivered in 2025. Our long-term record of outperforming the benchmark remains strong, and our 47^th year of maintaining or increasing dividends reflects a further positive outcome for shareholders.

With a high-quality equity portfolio and the continued growth potential of Independent Professional Services, Law Debenture is well positioned to build further on this progress and the Board remains confident in the Group's ability to deliver attractive long-term returns for our shareholders."

Denis Jackson, Chief Executive Officer, commented:

"2025 was another strong year for Law Debenture, reflecting the resilience and consistency of our differentiated model. We delivered robust NAV and share price growth, extended our 47-year record of maintaining or increasing our dividend, and IPS recorded its eighth consecutive year of mid to high single digit revenue and underlying profit growth.

Law Debenture's carefully constructed investment portfolio, together with the reliable and diversified income streams generated by our IPS business, continues to underpin our ability to perform through the cycle and we enter 2026 with confidence and strong momentum."

The Law Debenture Corporation Denis Jackson, Chief Executive Officer Isla Pickering, Chief Financial Officer Trish Houston, Chief Operating Officer	[phone]
Teneo (Financial PR) Matt Thomlinson/Oscar Burnett	[phone]  [e-mail]

¹ NAV is calculated in accordance with the Association of Investment Companies (AIC) methodology, based on performance data held by Law Debenture including fair value of IPS business and long-term borrowings. NAV is shown with debt measured at par and with debt measured at fair value.

² Share Price source: Refinitiv.

³ Source: Office for National Statistics

⁴ Calculated based on data held by Law Debenture for the period ended 31 December 2025.

Important information NAV performance is not the same as share price performance and investors may not realise returns in line with NAV performance. Tax assumptions and reliefs depend upon an investor's particular circumstances and may change if those circumstances or the law change. Nothing in this statement is intended to or should be construed as advice. This statement is not a recommendation to sell or purchase any investment. It does not form part of any contract for the sale or purchase of any investment. Issued in the UK by The Law Debenture Corporation p.l.c. The Law Debenture Corporation p.l.c.is registered in England and Wales with company number 30397 and registered address at 8th Floor, 100 Bishopsgate, London, United Kingdom EC2N 4AG. It is authorised and regulated by the Financial Conduct Authority as an internally managed AIF with firm reference number 629081. This statement is directed at and for use only by investors in the United Kingdom.

ANNUAL FINANCIAL REPORT

YEAR ENDED 31 DECEMBER 2025 (AUDITED)

This is an announcement of the Annual Financial Report of The Law Debenture Corporation p.l.c. as required to be published under DTR 4 of the FCA Listing Rules.

The Directors recommend a final dividend of 10.375 pence per share making a total for the year of 35.50 pence per share. Subject to the approval of shareholders, the final dividend will be paid on 29 April 2026 to holders on the register at the record date of 20 March 2026. The Annual Financial Report has been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the UK.

The financial information set out in this Annual Financial Report does not constitute the Company's statutory accounts for 2024 or 2025. Statutory accounts for the years ended 31 December 2024 and 31 December 2025 have been reported on by the Independent Auditor. The Independent Auditor's Reports on the Annual Report and Financial Statements for 2024 and 2025 were unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.

Statutory accounts for the year ended 31 December 2024 have been filed with the Registrar of Companies. The statutory accounts for the year ended 31 December 2025 will be delivered to the Registrar in due course.

The financial information in this Annual Financial Report has been prepared using the recognition and measurement principles of International Accounting Standards, International Financial Reporting Standards and Interpretations adopted for use in the UK (collectively Adopted IFRSs). The accounting policies adopted in this Annual Financial Report have been consistently applied to all the years presented and are consistent with the policies used in the preparation of the statutory accounts for the year ended 31 December 2025. The principal accounting policies adopted are unchanged from those used in the preparation of the statutory accounts for the year ended 31 December 2024.

Financial Summary

	31 December 2025 £000	31 December 2024 £000	Change %
Net Asset Value - with debt and IPS at fair value1*	1,440,357	1,150,512	25.19%
Total Net Assets per the statement of financial position~	1,202,075	931,371	29.07%
	Pence	Pence
NAV per share at fair value1*	1,081.49	872.34	23.98%
Group statutory revenue return per share†	37.26	33.48	11.29%
Capital return per share	192.28	40.51	374.65%
Dividends per share	35.50	33.50	5.97%
Share price4	1,054	893	18.03%
	%	%
Ongoing charges3*	0.56%	0.51%
Gearing*	12%	11%
(Discount)/premium* at 31 December	(2.5%)	2.4%

~ The comparative has been restated to reflect dividend removed from shareholders' funds. Refer to note below.

† Underlying Group revenue return was 34.27 pence per share in 2024.

For reconciliation of NAV at fair value per the above to published year end NAV please refer below.

Performance

	1 year %	3 years %	5 years %	10 years %
NAV total return (with debt at par)2*	29.2	58.6	78.8	184.5
NAV total return (with debt at fair value)2*	28.4	59.1	96.6	200.8
FTSE Actuaries All-Share Index Total Return4	24.0	46.5	73.9	123.4
Share price total return4*	22.2	53.1	85.0	212.4
Change in Retail Price Index5	3.4	13.2	37.3	55.6
Relative performance (NAV at FV)	4.4%	12.6%	22.7%	77.4%
Relative performance (Share Price)	(1.8)%	6.6%	11.0%	88.9%

* Items marked "*" are considered to be alternative performance measures and are described in more detail on pages 167 and 168 of the full annual report and accounts.

1 Please refer below for calculation of net asset value. Please note change in NAV per share in the financial summary does account for the effect of dividends on total return.

2 NAV is calculated in accordance with the AIC methodology, based on performance data held by Law Debenture including fair value of the IPS business and borrowings. NAV is shown with debt measured at par and with debt measured at fair value and both total returns account for shareholder returns through dividends.

3 Ongoing charges are calculated based on AIC guidance, using the administrative costs of the investment trust and include the Janus Henderson Investors' management fee, currently charged at the annual rate of 0.30% of the portfolio value. There is no performance related element to the fee. Gearing is described in the Strategic Report below and in our alternative performance measures on page 168 of the full annual report and accounts.

4 Source: LSEG, London Stock Exchange Group.

5 Source: Office for National Statistics.

Past performance is not a guide to future performance. Capital at risk.

EXTRACTS FROM THE STRATEGIC REPORT

Chairman's Statement

Performance

Law Debenture has achieved a very pleasing performance for the year ended 31 December 2025 in a period marked by modest economic growth, easing inflationary pressures and continued political and geopolitical uncertainty. While interest rates appear to have stabilised during the year, macroeconomic and market volatility has remained a feature of the investment landscape.

2025 saw a strong recovery in UK equity performance, although UK valuations remain attractive by historical and international standards. However, market returns were increasingly concentrated in a relatively narrow group of stocks and sectors benefitting from improving economic sentiment and short-term momentum.

In this context, the combination of a diversified Investment Portfolio and another good year of underlying performance for IPS has again enabled Law Debenture to deliver capital growth and increased dividend income for shareholders.

Law Debenture's long-term record of benchmark outperformance continues to be robust. In 2025, Net Asset Value ('NAV') with debt and the Independent Professional Services ('IPS') business at fair value delivered a strong return of 28.4%, while share price total return of 22.2% outperformed the AIC UK Equity Income sector weighted average return of 20.2%. Law Debenture has outperformed the FTSE All Share Index (Total Return) weighted average return in 21 of the past 26 years.

This performance reflects the continued strength of the Company's underlying performance and highlights the benefits and importance of its disciplined investment approach and diversified structure.

The Board is conscious that the wider investment trust sector is undergoing a period of significant change. During 2025, there was a sharp increase in corporate and shareholder activity across the industry, including greater use of share buybacks, several proposals for consolidation, and heightened focus on discounts to NAV. Share buybacks increased 36% in 2025 to £10.22b (vs £7.51b in 2024), while there were 27 mergers, acquisitions and liquidations across the sector, up from 24 in 2024.¹ This has been accompanied by more active engagement from certain shareholders in parts of the sector, prompting wider discussions around performance, governance and shareholder alignment.

The Board monitors developments across the investment trust sector closely and remains attentive to matters relevant to Law Debenture. We believe the Company's long-term investment approach, diversified structure and strong governance leave us well placed to navigate this evolving environment successfully in the best interests of shareholders.

Dividend income received from our Investment Portfolio, was up 16.1%, from £34.7m in 2024 to £40.3m in 2025, driven by net investment during the year, including specific sectors with dividend yields greater than the portfolio. The net revenue from our IPS business increased 7.5%.

Overall, our statutory revenue profit before tax was up 13.3% and our statutory revenue EPS was up 11.3%. The prior year was affected by £1.0m of non-recurring costs. Excluding the impact of these, our underlying revenue profit before interest and tax was up 10.8%, and our underlying EPS was up 8.7%.

1 Source: IFA Magazine "Investment Trust 2025 review: another record year for corporate activity", 13 January 2026.

Awards

The Board was pleased to see the Company recognised again during the year.

Law Debenture was named Best for Long-Term Income-Active at the QuotedData Awards and Income Company of the Year at the AJ Bell Investment Awards, reflecting the strength and consistency of our income-focused investment approach. The Company also received the Shareholder Initiative of the Year Award at the Investment Week Investment Company of the Year Awards, reflecting Law Debenture's commitment to meaningful and proactive shareholder engagement and communication within a changing investment trust environment.

This recognition builds on the awards received in recent years and reinforces the Company's standing within the AIC UK Equity Income sector.

Dividend

We are proud of Law Debenture's record of increasing or maintaining dividends, which now extends to 47 consecutive years. This record continues to be underpinned by the consistent cash generation of the IPS business, which provides an important and stable source of income alongside dividends received from the Investment Portfolio.

Subject to your approval, we propose paying a final dividend of 10.375 pence per ordinary share. The final dividend will be paid on 29 April 2026 to holders on the register on the record date of 20 March 2026. This will provide shareholders with a total dividend of 35.50 pence per share for 2025, an increase of 6.0% compared to 2024 and fully covered by earnings for the year.

The dividend increase is ahead of CPI and represents a dividend yield of 3.1% based on our closing share price of 1,132 pence on 10 March 2026. Over the last 10 years, we have increased the dividend by 119.1% in aggregate.

Our Portfolio

Our Investment Managers, Janus Henderson Investors, continue to manage a differentiated portfolio of high-quality businesses with strong competitive positions, resilient balance sheets and attractive long-term growth prospects. The portfolio delivered strong overall returns in 2025.

Dividend income of £40.3m from the Portfolio was £5.6m higher than 2024, alongside a total capital profit for the year of £255.2m, driven by movements in the value of the Portfolio holdings.

The Board continues to support the Managers' disciplined approach, which focuses on valuation, sustainability of earnings and cash generation, and prudent capital allocation.

IPS

IPS remains a key differentiator for Law Debenture and an important contributor to long-term NAV progression. In 2025, IPS continued to deliver resilient earnings and cash flow, reinforcing its role as a stabilising influence during periods of market volatility and a meaningful contributor to shareholder returns.

Although accounting for only c.16% of our NAV at 31 December 2025 (with IPS and Debt at Fair Value), the IPS business has funded around a third of our dividends in the last 10 years and delivered a compound annual growth rate in underlying profit before interest and tax of 6.4% over the last five years.

The value of IPS as a percentage of the Trust's NAV fluctuates from year to year and is influenced both by the performance of the portfolio as well as IPS. The benefit of the Trust's ownership of IPS is both the contribution that IPS makes to income as well as the capital growth in IPS valuation.

IPS delivered another year of growth, supported by a degree of counter-cyclicality in some of our businesses. Corporate Services and Corporate Trust were the strongest performers, achieving net revenue growth of 12.2% and 9.3% respectively, with Pensions broadly flat.

The Board continues to have confidence in IPS' ability to deliver sustainable growth, supported by ongoing investment in people, systems and technology.

Capital structure

In 2025, the Group issued 1.3 million new ordinary shares to existing and new investors, with net proceeds of £11.6m to support ongoing investment. Shares were issued at a premium to NAV to be accretive to existing shareholders. No shares were bought back during the year.

Environmental, Social and Governance ('ESG')

The Board remains committed to high standards of governance and to embedding environmental and social considerations across the business. The IPS business is founded on the provision of independent governance services, and diversity and inclusion remain central to this work. ESG considerations continue to form an integral part of investment decision-making within the Portfolio. For further details, please refer to our ESG section on pages 53 to 62 of the full annual report and accounts.

The Board

There were no changes to the composition of the Board over the course of the year.

Annual General Meeting ('AGM')

The AGM will be held Friday, 24 April 2026 at 11.00am. In order to welcome as many of our shareholders as possible, we will hold the AGM at the offices of our joint corporate broker Peel Hunt and not at our own office. Please join us at Peel Hunt, 7th Floor, 100 Liverpool Street, London EC2M 2AT. The Board and wider Law Debenture team value the chance to meet with our shareholders and hear your thoughts about the Company, so we hope that you are able to join us for the AGM and light lunch.

Looking forward

UK equity markets recorded a strong year in 2025, supported by improving sentiment and a partial re-rating from historically depressed valuation levels. That said, market returns were uneven and driven by a relatively narrow group of stocks benefitting from improving economic expectations.

The wider market backdrop is improving, but uncertainty remains. By the end of 2025, inflation had receded from the elevated levels experienced in recent years, but interest rates remain materially higher than those that prevailed for much of the period following the global financial crisis in 2008/09. Investors are increasingly able to look beyond the immediate challenge of price instability, but uncertainty continues to influence valuations and overall investor behaviour.

In this context, our Investment Managers continue to focus on identifying high-quality businesses with strong competitive positioning, resilient balance sheets and attractive long-term growth prospects, rather than seeking to capture short-term market trends.

The great majority of the Investment Portfolio remains invested in UK equities, although a significant proportion of underlying earnings is generated outside the UK. Even after the market recovery seen in 2025, our Investment Managers believe that a number of UK companies continue to trade at valuations that do not fully reflect the quality of their businesses or their long-term prospects, even if the timing of any re-rating remains uncertain. Many companies continue to deploy surplus capital through share buy-backs and disciplined investment, while M&A interest from overseas corporates and private equity looks set to continue into 2026.

Law Debenture remains well-positioned with a long-term focus on a diversified portfolio of conservatively managed businesses, often market leaders, that are capable of generating sustainable earnings and cash flows across different economic environments. Meanwhile, IPS continues to provide a stable and growing source of earnings and cash flow. Its services remain well sought after, its brand reputation is strong and opportunities to increase market share remain considerable. All of this supports continued NAV and dividend progression, while acting as a stabilising influence during periods of market volatility.

The Board and our Investment Managers believe Law Debenture is well-positioned to navigate a range of potential economic outcomes and to continue to deliver attractive long-term returns across market cycles.

On behalf of the Board, I would like to thank our Investment Managers and skilled workforce for their hard work, and our shareholders for their continued support.

Robert Hingley

Chair of the Board

10 March 2026

Chief Executive Officer's Review

Introduction

2025 was a strong year for Law Debenture, with the Group again delivering against our long-term investment proposition. Amid a mixed economic backdrop and ongoing geopolitical uncertainty, we were able to deliver continued Net Asset Value ('NAV') and share price growth, and increased income, for shareholders, while further strengthening our IPS business.

I am pleased with our performance across all key measures. Law Debenture delivered NAV total return with debt and Independent Professional Services ('IPS') at fair value of 28.4%. This is an exceptional outcome and reflective of the hard work of our Investment Managers and colleagues.

Equity markets performed well during the year and this supported a share price total return of 22.2%, above the AIC UK Equity Income sector weighted average return of 20.2%. We are pleased that shareholders benefited from a year of substantial value creation alongside continued dividend growth. Our record over three, five and ten years continues to consistently outperform both the benchmark and the majority of our key sector peers, and we are also proud to report our 47th year of maintaining or increasing dividends, with a 6.0% increase this year.

Our investment portfolio, run by Janus Henderson Investors, demonstrated the effectiveness of our managers' valuation-focused, moderately contrarian approach which aims to identify good quality, predominantly UK-listed companies often trading on low valuations but positioned to benefit from structural changes. In a year where UK stocks performed better than the major American indices, the portfolio continued to benefit from UK holdings, most of which generate revenues both at home and overseas.

This disciplined approach and the portfolio, which accounts for 84% of Law Debenture's NAV with Debt at Fair Value, combines with our Independent Professional Services business, representing 16% of NAV, to offer investors a truly differentiated proposition that is underpinned by strong cashflows and a robust balance sheet. The combination enhances resilience through the cycle, a unique benefit among investment trusts, and continues to validate the strength and durability of our business model and strategy.

The quality of our proposition was again recognised externally during the year. We were delighted to be named Income‑Active Company of the Year at the AJ Bell Investment Awards, Best for Income at the QuotedData Investors' Choice Awards, and Shareholder Initiative of the Year award at the Investment Week Investment Company of the Year Awards. These awards reflect not only investment performance and continued delivery from our colleagues, but also a strong focus on, and pride in, our engagement with our much valued shareholders.

We delivered on our two main objectives, producing NAV growth and continuing to increase income for shareholders

IPS delivered another year of progress, recording its eighth consecutive year of mid to high single digit revenue and underlying profit growth. IPS business net revenues (gross revenue less direct costs incurred) increased by 7.5% to £57.7m (2024: £53.7m), and statutory profit before interest and tax ('PBIT') was £16.7m. Excluding the impact of £1.0m of non-recurring costs in the prior year, the underlying PBIT of IPS increased 6.1%. Statutory Profit Before Tax ('PBT') increased 15.8% to £17.7m.

IPS remains a core differentiator for Law Debenture, with its reliable and diversified income streams helping to underpin dividend growth and enhance the stability of returns for shareholders. This has contributed to the Group delivering a 119.1% increase in dividends over the last ten years. The steady flow of income continues to give our investment managers greater flexibility in portfolio construction, enabling investment across a wider set of value opportunities than many of our sector peers further supporting the potential for attractive long-term returns.

During the year we continued to place a strong emphasis on fostering a collaborative and stimulating culture. My firm belief is that the quality of our people is our greatest asset, and that investing in their development is essential to the long-term health of the Group. This commitment was recognised when Law Debenture won the award for Most Impact at the 2025 INSEAD Alumni Balance in Business Initiative Awards, reflecting the progress we continue to make in building a balanced and inclusive workplace.

The investment trust sector is itself going through a period of heightened activity and change. The involvement of Saba Capital during 2025 and into 2026, and the repercussions felt across several investment trusts, is forcing closed-end funds to be clear about their relevance and value proposition. We view this environment as a positive catalyst that rewards clarity of purpose, strong governance and well-differentiated propositions.

Against this backdrop, our focus remains wholeheartedly on the execution of our business plan, and delivering against our objectives to achieve long-term capital growth in real terms and steadily increasing income for shareholders.

Corporate Trust

Law Debenture was incorporated to act as a bond trustee in 1889. The role of a bond trustee is to act as bridge between the issuer of a bond and the individual bondholders. Our responsibilities as bond trustee can vary materially whether servicing either performing or defaulted bond issues.

Normal obligations for the bond trustee to support performing issues could include communication to the bond holders of financial or security data together with the distribution and/or receipt of covenant information. For completion of this work, we are typically paid an annual fee throughout the lifetime of the bond. This fee is inflation linked for the majority of our existing book of business. When an amendment to bond documentation is required, we can also earn additional revenues to complete the necessary changes.

When bonds default, the workflow, risk and revenue profiles of our role can materially change. A key duty of the bond trustee is to be the legal creditor of the issuer on behalf of the bondholders.

Our role in such default situations requires material incremental work that, given a favourable outcome, can lead to significant additional income for us. That said, defaults often take years to play out and the results are uncertain. Given this long dated and fluctuating backdrop, our revenues for this work in any specific calendar year can be somewhat lumpy. However, such post issuance work has strong economic counter cyclicality and has produced sound returns for our shareholders over time.

Corporate Trust - Market dynamics

New issuance in debt capital markets has always been an important driver of revenues. As well as receiving an ongoing (typically inflation-linked) annual fee for our work, we also receive an upfront fee upon appointment to a role. Following a very strong 2024 when primary market new issuance grew by 20%, deal volume in Europe was up a more modest 10% year on year (source Dealogic) in 2025. As we noted at the half year, 'Liberation Day' in early April led to a spike in market volatility and decline in primary market activity until new issuance levels were established. Sentiment steadily improved as the year progressed and we finished the year with Corporate Bond spreads again hitting new multi-year lows (source ICE Data Indices). Globally the interest rate cutting cycle continued with The Bank of England, Federal Reserve and ECB again all reducing borrowing rates during the year. Particularly pleasing to see were appointments to support the allocation of new capital to emerging and fast-growing areas of the economy such as construction of data centres and the development of energy infrastructure.

Demand for our post-issuance work is hard to predict and is strongly countercyclical. As has been widely reported, some elements of the UK economy were weak in 2025. Consequently, across our portfolio of business, we did complete several incremental workstreams relating to restructuring projects on behalf of bondholders.

We are proud to have delivered a 119.1% increase in dividends per share over the last ten years, with 47 years of increasing or maintaining dividends.

We have invested in new people and technology to support our Loan Agency efforts. As the year progressed, we were pleased to achieve an increasing number of appointments where we acted as both the Security Agent and Loan Agent on a transaction. Private Credit as an asset class continues to grow rapidly and market participants are increasingly using non-bank service providers to support transactions. We will look to build further momentum in this sizeable market.

Over the past five years or so we have made particularly pleasing progress with respect to the expansion of our Escrow product and solutions. By way of reminder, an escrow solution allows two parties the ability to transfer an asset with a trusted independent middle-man ensuring that certain conditions of the transaction have been met by both sides prior to completion. A key market development has been the Solicitors Regulatory Authority ("SRA") through recent consultations (late 2024/2025), signalling a shift away from law firms holding client money. Our deep domain expertise coupled with our ability to move fast and means to consider non-standard transactions gives us our competitive advantage. During the year we provided escrows to support transactions across a considerable range of sectors and had our busiest ever month in December.

DIVISION	Net revenue 2021** £000	Net revenue 2022** £000	Net revenue 2023** £000	Net revenue 2024** £000	Net revenue 2025 £000	Growth 2024/2025 %
Corporate trust	10,025	11,077	13,027	14,555	15,912	9.3%
Pensions	13,060	14,343	17,396	16,694	16,615	(0.5)%
Corporate services	18,501	19,749	20,086	22,412	25,152	12.2%
Total	41,586	45,169	50,509	53,661	57,679	7.5%

* Total net revenue is calculated by reducing segment income of £66,699k by cost of sales of £9,020k. Please refer to the IPS segmental analysis below.

** Comparative periods reflect transfer of loan agency business from Corporate Services to Corporate Trust for comparability with 2025.

Corporate Trust - Highlights

Following very strong 17.6% growth in revenues in 2023, and 11.7% growth in revenues in 2024, we are delighted to report revenue growth of 9.3% in 2025. This is an excellent cumulative growth for what is a 136-year old business. Why have we been able to achieve this?

The revenues for this business are underpinned by a very well diversified book of long-term inflation linked fee-based transactions that have been built up over many decades. This is hard won and has considerable franchise value, over and above the cash flow value of the business, by virtue of the client and referral partner networks that have created and continually renew it.

However, the business' revenue growth profile has not been and will never be linear and, following such a strong period of cumulative growth, it is reasonable to expect some sort of reversion to a long-term mean for revenue growth (mid to high single digits) in 2026 and beyond.

The two main differentiating factors that have driven our growth in recent years have been (i) the refresh and expansion of our expertise for products and services and (ii) the addition of dedicated business development resource and the introduction of an explicit business development metric(s) for each team member. Law firms have always been crucial to our business and we have made a consistent, systematic effort to reinvigorate these types of relationship that are our bedrock.

We completed a number of notable new transactions during the year including the establishment of an Medium Term Note programme for Magnum Ice Cream Company following its demerger from Unilever, a structured debt instruments issuance programme for Crédit Agricole Corporate and Investment Bank, the issuance of subordinated notes by Hampshire Trust Bank plc, a sukuk issuance where the underlying obligor is the Republic of Türkiye, and a JPY 200 billion convertible bond issuance by Nissan Motor Co., Ltd.

Corporate Trust - Outlook

We have had three years of above-trend revenue growth at a compound annual rate of 12.8%. This is a great business but year-on-year revenue growth is hard to predict. We believe realistic longer-term revenue growth expectations should be in line with our broader ambitions for the IPS business (i.e mid to high single digit growth).

We continue to invest in additional headcount to join our Treasury team, our Loan Agency team, and have added incremental resource in Hong Kong.

Eliot Solarz was appointed to head our Corporate Trust business at the beginning of 2018. Over the eight years since his appointment, we have grown our revenues by a compound annual rate of 9.1%.

We have every confidence that this business will continue to produce solid returns for our shareholders over time.

Pensions

We are the longest-serving and one of the largest independent providers of pension trusteeship in the UK with approximately 250 appointments.

Our Pensions Governance (formerly Pegasus) offering of outsourced pensions executive and governance solutions continues to be a leading provider in a competitive market, developing new propositions that further support our clients and demonstrate our investment and commitment to the industry.

Pensions - Market dynamics

Market Landscape and Opportunities

2025 underscored the critical importance of expert pension scheme trusteeship and robust governance. Strengthened funding positions across many schemes have reignited corporate sponsor interest in comprehensive "end-game" strategies. Organisations are actively considering buy-in and buy-out options, alongside evaluating the potential to retain schemes with long-term surplus positions. This evolving environment reinforces the essential role of independent professional pension expertise-particularly through corporate sole trustee solutions. These models address succession challenges, optimise resource and deliver the specialised skills required to navigate complex strategic decisions.

Many schemes connected to the Pensions Dashboard which in turn initiated more engagement with administrators and how they are supporting members and clients.

Legislation and Regulation

After a period of relative regulatory stability, significant developments emerged with the introduction of the new Pensions Bill to Parliament in June 2025. Accompanied by wide-ranging announcements covering Defined Benefit (DB), Defined Contribution (DC), and Local Government Pension Schemes, this legislation positions pensions firmly as a government priority. A key enhancement enables DB schemes to access surplus extraction more efficiently, providing trustee boards and corporate sponsors with greater flexibility. These changes are expected to drive increased demand for premium professional trustee services. While the Autumn 2025 Budget contained limited pensions-specific measures, further developments are expected in 2026 and beyond, with pensions remaining high on the government's agenda.

Independent Trusteeship

More than 50% of UK occupational pension schemes now have an independent trustee-a clear recognition of the value of impartial oversight. The market remains competitive, with a notable rise in tenders for trustee services and growing interest in the Corporate Sole Trustee (CST) model. Our team-based approach is well aligned with this trend, delivering resilience, continuity, and deep expertise.

Pensions - Highlights

Unsurprisingly, as we have flagged previously, following an outstanding 2023 our revenues have normalised. Our broadly flat year-on-year revenues in 2025 mask what was a year of considerable progress for our Trustee and Pensions Governance businesses. Over the past eight years, compound annual revenue growth remains a healthy 9.1%. In our core Pensions business, we were delighted to add incremental appointments that included names such as Combined Nuclear Pension Plan, Whitbread, TPT Superfund and the Fidelity Master Trust.

Ireland continued to grow with new clients coming on board. In addition, we won our first Corporate Sole Trustee ("CST") appointment which we also believe is the first such appointment in Ireland. Our Manchester team continues to be a leading presence for trusteeship and governance in the North of England. In addition, Jersey also continues to be a focus where we have taken on more appointments.

The Pension Governance business continues to see demand across a number of different services areas, including support to stretched in‑house teams (including those that face retention challenges on the road to buy-out,) project management support, data/GMP projects, provider review and selection, General Code support, and trustee effectiveness reviews.

We added new capabilities to our CST clients, embedding the General Code as standard, and will continue to demonstrate the streamlining CST can bring to the governance for all sizes of scheme.

In the last twelve months, we have helped deliver over seven material buy-in transactions for our clients, including ArvinMeritor and Ultra Electronics.

Pensions - Outlook

We have added capacity to our team in anticipation that 2026 will be a busy year. The implications of the measures included in the Pensions Bill will need careful consideration alongside renewed engagement by many sponsors on future pensions strategy. March 2026 will also be crucial for preparing schemes' first Own Risk Assessments and evaluating how Pensions Dashboard Programme connections have affected them.

As trustee boards and corporate sponsors continue to evaluate a range of long-term options for their schemes, we remain strongly positioned to provide both strategic insight and operational governance support. The pace of change in funding levels and regulation is accelerating, reinforcing the need for experienced, independent trusteeship and governance solutions.

Our expanding service model, spanning co-trustee roles, Corporate Sole Trustee solutions, and governance frameworks, ensures we can meet these evolving requirements with resilience and deep domain expertise. We expect sustained growth in demand for professional trustee and governance services as schemes navigate complex decisions around buyouts, run-on strategies, and surplus management.

Corporate Services

Corporate Services consists of four well-diversified constituents. Structured Finance Services, our whistleblowing division Safecall, Service of Process, and our Corporate Secretarial Services business ("CSS"). In 2025 revenues were up by a very healthy 12.2% and all parts of the business grew revenues year-on-year. In particular, it was encouraging to see solid and well-diversified growth across our CSS suite of products and solutions.

Service of Process ('SoP')

SoP - Market dynamics

This remains our business with the least recurring revenues. It has the greatest dependency on global macro-economic factors and deal flow in capital markets. Following a challenging first half of the year Investment Banking revenues finished up a healthy 15% globally year-on-year in 2025 (source : Dealogic). We participated well against this improving backdrop as the year progressed.

SoP - Highlights

The heavy transaction volume in this business provides us with a rich data set as to where/why we are/are not winning business. Consequently, we are able to be increasingly systematic with our business development efforts.

Our global brand is hard won over many decades and needs to be constantly refreshed. We place a lot of emphasis on continually expanding our networks within all levels of law firms, but, in addition, are conscious of the need to be more visible directly to corporates.

Investment in technology to improve our client experience remains a priority along with investment in training and business development.

Earnings in SoP will always be variable and the changes in annual earnings from the first half of this decade illustrate this well. We have extremely limited ability to forecast revenues, but our history and excellent referral partner and client networks give us confidence that this business will remain a material contributor to our profits over financial market and economic cycles.

Corporate Secretarial Services ('CSS')

CSS - Market dynamics

The global company secretarial services market continues to grow steadily underpinned by increasing regulatory complexity, the rise of corporate governance standards, and an increased use of outsourcing by clients to solve for these constantly evolving needs.

We have been offering solutions in this sector for over twenty years and operate in three main product areas:

Managed Services: Global Entity Management services ("GEMS") provide a single outsourced point of contact to multinational corporations to ensure that their legal entities are kept in good standing. Client appointments vary in scale and coverage, ranging from a single legal entity in one country at its simplest to over 300 subsidiaries in 50 countries at its most complex. We are generally paid a fixed annual fee to deliver annual compliance and corporate records maintenance. We may also earn incremental revenues from additional projects such as incorporations and dissolutions, the co-ordination of global corporate change projects and performing entity validation work. Excellent workflow management and use of technology is critical to compete effectively in this space and we continue to invest heavily here. Our team is based in our Manchester office.

Corporate Governance Services: This work stream covers all aspects of Board and Committee support, from full outsourced company secretarial support to attending and minuting meetings. We also provide practical company secretarial support to companies preparing for an IPO transaction including support post listing. Our clients range from major Main Market and AIM listed companies including investment trusts to leading UK operating subsidiaries of top global brands. Our fees are often fixed annual fees for specifically scoped mandates but can also be time or project based. Demand here is often for highly skilled professionals with prior experience in a particular industry and/or governance framework who can seamlessly transition work from being completed in-house. This team is based in London.

Interim Resourcing: Here we provide immediate access to qualified governance professionals whether on-site or remote, full time or part time as required by the client. Typically, we are paid on a time-spent basis, but also complete certain work on a fixed fee. This team is based in London.

CSS - Highlights

At the half year we noted that revenues were slightly up, and that we were increasingly confident that our record sales pipelines would begin to feed through as the year progressed. We are delighted to report this proved to be the case and the positive momentum in terms of client experience, improvement in our technology platform, and sales pipelines, continues to steadily build. Revenues in this business grew faster than the average for IPS and profits by even more as we continue to improve the efficiency of our workflows.

Our ability to move fast and build technology solutions to respond to emerging client need was illustrated well during the year as we became an Approved Corporate Service Provider to Companies House in relation to the provision of Independent Director Verification services required under the UK's Economic Crime and Corporate Transparency Act. We are increasingly working with clients in using improving AI tools to enhance the efficiency of creating minutes. Better use of technology frees up our professionals for more strategic and advisory roles. For example, we now regularly provide Directors' Duties training for our UK listed client base.

Our new leadership team established in 2024 has bedded in well.

We are increasingly confident that the significant investments that we have made in people, skills, technologies and operational workflows will underpin sustainable and controlled growth in this business over time.

Structured Finance Services

Structured Finance Services - Market dynamics

We operate in two main product areas:

Management of Special Purpose Vehicles ('SPV's') and other similar corporate structures: We provide directors, accounting and day-to-day corporate administrative services to entities set up to help financial institutions, including challenger banks and boutique asset managers (Private Equity and Hedge Funds), diversify their funding using securitisation techniques. The SPV's are established to raise funds in the bond / loan markets which are then used to acquire distinct pools of assets (including mortgages, receivables, credit card debt, aircraft, whole businesses etc.) against which the funds are secured. The funding is non-recourse meaning that the funds raised only have recourse to the pool of assets on which they are secured and to no other party.

Accounting services: We provide management and statutory accounting services to corporate entities who wish to outsource this area or where they do not have local accounting knowledge. We do not provide audit services to clients.

As we flagged in last year's annual report oversight for Facility and Paying Agency services was transferred to our Corporate Trust business at the start of 2025. Increasingly, we find that clients are seeking Security Trustee and Loan Agency roles as a combined solution, so we have aligned our resources accordingly.

We remain a small player in a large and growing market. We score very highly for quality-of-service delivery and continue to build on these solid foundations.

Structured Finance Services - Highlights

Following a broadly flat year in 2024, new issuance levels grew modestly during 2025 and both our revenues and profits grew year‑on‑year.

We were particularly proud to be appointed to support The Climate Investment Funds Capital Markets Mechanism. This is a G7 - backed, World Bank facilitated vehicle that focuses on low carbon initiatives in Developing Countries.

We were delighted to support the first ever European Home Equity Line of Credit ("HELOC") backed Residential Mortgage Backed Security ("RMBS") issued by Waterfall Asset Management.

In addition to the innovative structures above, we again received repeat appointments from a number of leading non-bank specialist lenders operating in the sector including Pepper and Lendinvest.

Private Credit continues to build momentum as an asset class. The number of non-bank, specialist lenders (e.g., in auto loans, consumer receivables, and mortgages) continues to rise, bringing new and lesser-seen collateral types to the public markets. Credit spreads ended the year near multi-year lows and, with a general expectation of decreasing interest rates, market participants expect conditions to remain positive in 2026.

With an increased emphasis on business development, we will compete aggressively to grow our market share in this growing market.

Whistleblowing: Safecall

Safecall - Market dynamics

Whistleblowing is now firmly part of the governance lexicon.

Law makers continue to push this agenda. In the UK, new protections for workers reporting sanctions-related misconduct came into effect in June 2025. In December, the UK government's Anti-Corruption Strategy 2025 paper was released. This recognises the vital role of corporate whistleblowers and signalled a potential review of the existing legal framework by 2027. In the United States, the Department of Justice (DOJ) launched a new Whistleblower Rewards Pilot Program in May 2025, which is expected to increase the flow of information to regulators and put pressure on companies to improve internal reporting systems.

Investors too are increasingly demanding of appropriate whistleblowing frameworks being in place. This is increasingly the case in developing markets and we see great potential to help our clients attract capital in this regard.

As with all of our IPS businesses, what differentiates our offering is the quality of our people. We are not a box ticker's product. All enquiries are dealt with by our highly trained staff that continues to consist largely of former police officers. The quality of the work that we do for our clients is highlighted in client surveys and perhaps more encouragingly in regular unsolicited positive client feedback. To the best of our knowledge, all of our competitors in the sector run business models based off low-cost call centres. We remain fully committed to being a premium provider of high-quality product.

Safecall - Highlights

Yet again we provided a record number of reports to our clients in 2025, up 52% on 2024. Revenues increased 24% year-on-year following 25% growth in 2024.

Following rapid growth over the previous five or so years, digital channels (as opposed to voice) continued to account for over 70% of issues raised. That said, the growth in the percentage of digital reports relative to voice has started to slow somewhat. Increasingly, we are finding that in complex and highly nuanced cases, the voice channel is the preferred choice of the whistleblower. The voice reporting channel has always been a differentiating competency of Safecall. We continue to invest in it with a new upgraded telephone system installed during the year to support this critical client need.

We also delivered increased client functionality via our portal in 2025 and client feedback is encouraging. We are increasingly successful in our efforts to effectively compete for larger mandates as they come up for renewal.

Our training and investigations offerings remain a work in progress and we have increased ambitions here.

It is an exciting time to be a provider of solutions in this fast-growing sector.

Central Functions

The larger and more consistent the earnings growth within IPS, the more optionality it creates for the managers of the Investment Portfolio to deliver on our objective of long-term capital gains and steadily increasing income. As we have noted in past annual reports, we are making a significant investment in modernising our operating model and central support functions to support this growth.

We continue to plan for growth of mid to high single digits, and expect this to be largely organic. We remain open to opportunities presented by acquisitions where we believe this could add value to our clients and shareholders.

Over recent years we have made significant investments in our operational infrastructure, taking a group of businesses which were long underinvested in and positioning them for growth in a coordinated and more streamlined way. The change has been profound, whilst we have fiercely protected our essence: independence, trust, and technical excellence. Day-to-day operations are almost unrecognisable. This journey continues. We have moved away from thinking about our business transformation as a rigid series of sequential start‑and-end-date projects. Instead, we are building a business which thrives in continual evolution, where agile adaptation is the new normal.

Having stabilised our operating infrastructure, we are now deliberately shifting our focus to our people. In a professional services business, our most valuable assets do not appear on the balance sheet. Unlike manufacturing or capital-intensive businesses, our real value lies in the expertise, relationships and capabilities of our colleagues. This is where we must invest most heavily to build long-term value for our shareholders. Growing great people is slow work, measured in years and decades rather than weeks and months. It must be steady and sustainable, and when done well becomes a scalable competitive advantage.

In 2025, we accelerated our people journey. Our new senior hires - Isla Pickering (CFO), Spencer Knightsbridge (CTO) and Alex Ringer (Head of Legal, Risk and Compliance) completed their first full year in post, using that time to understand their teams and identify capability requirements. They have developed clear visions and operating models for their respective areas within the broader business and are now building the right teams around them. We have deliberately recruited leaders with professional services experience who understand what it means to coach and mentor their people and deliver peace of mind for clients.

Alongside this, we began the second phase of transforming our HR capabilities. We have built upon the strong foundational HR we established over the last few years and moved towards a People team focused on development, enablement, and high-performing teams. We have implemented a new competency framework, aligned our career pathways with reward and incentive systems, and have begun shifting our performance conversations from input to impact and accountability. We held our fourth annual Culture Week, reinforcing our values of "believing it's possible, making change happen, being better together and never stopping learning". Our COO, Trish Houston, participated in the London Business School Senior Executive Programme, deepening our strategic leadership capabilities, while reinforcing our commitment to continuous learning at every level of the organisation.

This investment in our people is critical. We operate in a world of accelerating change where client needs are evolving faster than we have ever known. Our business is built on independence and trust, and our clients need us to be more than advisers. They need us to be trusted partners who are woven into the fabric of their long-term strategy. We must embrace the changes occurring around us and understand the governance implications of technological advances, cultural shifts and regulatory change. Whether it is supporting boards thinking about AI governance or navigating complex restructuring, our people must be curious, market-aware, relentless about quality and equipped with a professional services mindset.

In 2025, we laid the foundations of our Governance Academy and began to shift our approach to talent development - complementing hiring in experienced people with an increasing amount of home-grown talent. With increased People team capacity and skills we are ready to quicken the pace of this journey. In the year ahead, we will launch structured programmes focused on capability building - both for our colleagues and, increasingly, for our clients. This dual focus on developing our own people whilst supporting our clients in building their capabilities positions us well for the competitive landscape ahead.

Information Technology

Our technology strategy focuses on delivering robust, scalable solutions that enable our businesses to serve clients effectively whilst maintaining operational excellence and meeting regulatory standards. Under Spencer Knightsbridge's leadership as Chief Technology Officer, who joined in September 2024, we have made significant progress in strengthening our foundations and advancing strategic capabilities.

Cyber security remains our top operational priority. We continue to invest in enhanced tooling, expanded capabilities, additional resources, and comprehensive staff training across the organisation to maintain our robust security posture. The cyber threat landscape continues to evolve rapidly, with increasingly sophisticated attacks targeting organisations of all sizes. We recognise that whilst we cannot eliminate all risk, we must maintain vigilant defences and effective response capabilities through continued investment in our security infrastructure and practices.

Our artificial intelligence adoption has progressed from initial training and exploration to practical implementation. We have deployed AI in specific use cases across the organisation, carefully evaluating effectiveness whilst maintaining appropriate governance frameworks and security standards. This measured approach ensures we begin to harness the benefits of AI innovation whilst managing associated risks responsibly.

Safecall has made significant progress in expanding its enterprise client capabilities. Working in partnership with key clients, we have developed new portal functionality that will be rolled out to our broader client base. This enterprise-focused development approach continues to strengthen our market position and builds on the portal enhancements delivered in previous years.

In CSS, our Identity Document Verification solution for ECCTA went live during the year and continues to evolve with enhanced capabilities. This positions us well to address growing regulatory requirements and client demand for robust digital identity verification across our client base.

We continue to invest in our technology delivery capability, strengthening our engineering functions to support increasingly sophisticated solution delivery, supporting the business's growth objectives whilst maintaining the operational excellence.

Prospects

Law Debenture enters 2026 with good momentum and our differentiated structure continues to provide resilience in what is expected to remain an uncertain external environment.

IPS is expected to deliver continued medium-term growth and maintain its strategic importance within the Group, in line with our mid to high single digit growth target. We continue to invest in key IPS growth areas, which involves transforming and future-proofing our operating model through technology and modernising of services to deliver even better outcomes for our clients. This is intended to support sustained organic growth and help us gain further market share.

From an equity market perspective, UK stocks remain attractively valued relative to history and international peers. The recent recovery in UK equity performance has been concentrated in a relatively narrow selection of stocks and UK equity valuations remain broadly in line with long term averages. Sentiment continues to be influenced by political and economic uncertainty, but our investment managers believe that there is a wealth of UK companies which continue to offer a compelling opportunity for both earnings growth and valuation re-rating. There are many focused and well-managed businesses, operating within a broadly stable backdrop, which are on track to deliver growth and contribute to a revaluation of the UK market, with corresponding capital appreciation for shareholders.

Law Debenture's strategy is built to perform through a range of market conditions. We are confident that the Group remains well positioned to continue delivering our objectives to achieve long-term capital growth in real terms and steadily increasing income.

On behalf of the Board, I would like to thank my colleagues across the Group for their continued commitment and professionalism, and our shareholders for their ongoing support.

Denis Jackson

Chief Executive Officer

10 March 2026

IPS 5 Year Performance at a Glance

IPS net revenue and underlying PBIT - 5 year performance

Department	2020 £000	2021 £000	2022 £000	2023 £000	2024 £000	2025 £000	5yr Revenue Variance £000	5yr Revenue Variance %
Pensions	11,479	13,060	14,343	17,396	16,694	16,615	5,136	44.7%
Corporate trust	10,960	10,0253	11,0773	13,0273	14,5553	15,912	4,952	45.2%
Corporate services	12,055	18,5011, 3	19,7493	20,0863	22,4123	25,152	13,097	108.6%
IPS net revenue	34,494	41,586	45,169	50,509	53,661	57,6792	23,185	67.2%
% Net Revenue growth	8.5%	20.6%	8.6%	11.8%	6.2%	7.5%
Statutory PBT	12,227	13,340	14,421	15,936	15,284	17,704	5,477	44.8%
Underlying PBIT	12,198	13,4404	14,4594	14,7724	15,7004	16,659	4,460	36.6%
% Underlying PBIT growth	8.4%	10.2%	7.6%	2.2%	6.3%	6.1%

1 Includes revenue from the acquisition of the Company Secretarial Services business from Eversheds Sutherland (International) LLP.

2 This figure is included in the income statement by subtracting cost of sales of £9.0m from gross revenue of £66.7m.

3 2021-4 comparative reflect transfer of loan agency revenue from Corporate Services to Corporate Trust for comparability with 2025.

4 PBIT is stated on an underlying basis. Please refer to alternative performance measures on page 169 of the full annual report and accounts for reconciliation of statutory PBIT to underlying PBIT. Additionally, in 2025 net interest on the defined benefit pension asset/liability has been included within net interest below PBIT. In all prior years interest on the pension asset/liability was presented within admin expenses. To aid comparability of underlying PBIT across years, the net interest income/expense on the pension asset/liability in prior years has also been represented within interest income/expense in the APMs (refer to page 169 of the full annual report and accounts), with prior years underlying PBIT represented on this basis. This impacts APMs only. As the net pension interest is not material at the group level, no adjustment has been made in the primary financial statements.

IPS valuation

	2020 £000	2021 £000	2022 £000	2023 £000	2024 £000	2025 £000	5yr growth %
Underlying EBITDA1	13,335	15,469	16,688	17,325	18,257	19,493	46.2%
Earnings multiple1	9.4	10.7	10.4	10.7	10.7	10.7	13.9%
IPS fair value (excl. net assets)	125,349	165,985	174,174	185,063	194,505	208,665	66.5%
NAV adjustment: total value less net assets already included	112,407	135,885	148,376	160,836	187,395	202,524	80.2%

1 Underlying EBITDA is restated for 2021-2024 to reflect impact of pension credit interest. Refer APMs on page 170 of the full annual report and accounts for further details.

Investment Managers' Review

Investment Strategy

The investment approach has not changed for many years, but it has hopefully been improved with lessons learnt. There is a relatively long list of stocks which allows for a blend of large, medium and small companies. There are overseas holdings where a similar company cannot be found in the UK market or the overseas company is cheaper. Nearly 90% of the portfolio is in UK quoted companies at present, as this is where we are finding superior value despite concerns about the UK economy. The belief behind portfolio construction is that genuine diversity in the holdings is how capital is preserved in the long term.

We employ different approaches to how we look at potential investments. Around 50% of the portfolio is in FTSE 100 companies. These are, we believe, sound long-term investments and they are often well-known companies that feature in other portfolios with similar objectives. However, it is what you do differently to others that makes you perform differently. Law Debenture's unique structure of cash-generative operating companies (IPS) and an investment portfolio gives the opportunity to have a wider range of investments and still produce an attractive level of earnings. Therefore, unusually for an income growth trust, there are investments that do not pay a dividend. Early-stage small companies and operationally challenged large companies feature. The small companies that succeed will give substantial returns. Large companies with a recovery plan and determination to implement it should, in time, return to paying dividends at a considerably higher share price. The different strategies employed to look at companies result in real diversification of underlying operating activities. It does mean there are usually around 150 holdings and we do not go over 175. The absolute stock specific risk is relatively low compared to the index, and we believe the diverse blend of companies held will contribute, over time, to the better performance of your Company.

Economic and market backdrop

The UK economy experienced slow but positive growth during the year, with the second half virtually flat. This is not a bad background for equity investment as it has allowed interest rates to fall as inflation pressures subsided. It does make stock picking more demanding as the dull economy does not bail out companies that are failing to compete satisfactorily. Falling interest rates over time can help the economy as corporates become more confident about the operating environment and therefore push forward with their expansion plans. Lower rates can mean that consumers who are presently saving into deposit accounts search for higher returns. It is a notable feature of the UK economy that savings into deposit accounts are running at much higher levels than they did pre-Covid. This changing consumer behaviour has been a dampener on economic activity in recent years. The savings ratio can fall with further interest rate cuts and as consumer confidence rebuilds. This can help the earnings profiles of UK companies.

Group NAV total return	1 year %	3 years %	5 years %	10 years %
NAV total return (with IPS at fair value and debt at par)1	29.2%	58.6%	78.8%	184.5%
NAV total return (with debt and IPS at fair value)1	28.4%	59.1%	96.6%	200.8%
FTSE Actuaries All-Share Index total return2	24.0%	46.5%	73.9%	123.4%

1 NAV is calculated in accordance with AIC methodology, based on performance data held by Law Debenture including fair value of IPS business. NAV total return with debt at par excludes the fair value of borrowings, whereas NAV total return with debt at fair value includes the fair value adjustment (see page 168 of the full annual report and accounts).

2 Source: LSEG, London Stock Exchange Group, all references to 'FTSE All-Share' and 'benchmark' in this review refer to the FTSE Actuaries All-Share Index total return.

The slow economic growth has made for a reluctant bull market. There is no euphoria and investors are risk averse in their stock picking, preferring large companies over smaller ones and those with a stable earnings outlook over more cyclical companies. We have in recent years been building up the smaller company exposure as valuations are undemanding. The high level of corporate activity with agreed takeovers suggest that quoted smaller companies are offering substantial value.

One Year Performance Review and Attribution

For the second year in a row, three of the top five absolute contributors to performance were banks, as the sector continued to benefit from higher interest rates boosting returns, while loan losses remained subdued. We have taken modest profits in the sector, but it remains 13% of the portfolio, as we see the potential for ongoing attractive shareholder returns via dividends and share buybacks. Also among the best performers were aerospace and defence suppliers Rolls-Royce and Babcock. In both cases, we have taken substantial profits on valuation grounds. Babcock, for example, at calendar year end was trading on a low 20s current year P/E. This would compare to a low teens P/E a few years ago, on earnings per share that have also roughly doubled. While the outlook for defence spending has undoubtedly changed in recent years, we see this as now more priced into the shares at current levels.

The top five contributors to performance during the year (in absolute terms) were:

Top five gains over one year

Stock	£ Appreciation	% Appreciation
Barclays	£24.1m	77.5
Rolls-Royce	£19.3m	80.7
HSBC	£16.8m	49.3
Standard Chartered	£12.4m	66.7
Babcock	£11.3m	117.6

Source: Law Debenture.

Note: % appreciation figures are share price only, not total return.

Having been among the best performers in 2024, in 2025 Flutter Entertainment was the largest individual detractor. Flutter are among the market leaders in the fast growing (and large) US market, but the pace of legalisation has disappointed and there are concerns that the prediction market, while currently small in size, could eat into their addressable market over time. We took profits in the holding early in the 2025 calendar year (at a higher share price), but in the second half of the calendar year maintained the holding on the view that the US market provides the potential for material earnings growth over time.

Among the detractors, building materials suppliers Ibstock and Marshalls have been impacted by subdued UK housing building activity. In both cases we gradually added to the holdings during the year. Substantial fixed costs (for example kilns in the case of Ibstock), mean that any disappointment on volumes has a substantial impact on profitability. This can, however, work both ways and, on any pick‑up in building activity, earnings could recover materially. Morgan Advanced Materials was similarly impacted by weak trading in some of its end markets, resulting in a low operating margin of approximately 10% in 2025, compared to a medium-term target of 12-14%. On a depressed earnings number, the shares currently trade on a lower than historical average valuation of approximately 12x 2025 earnings. As with Babcock, the best total returns can be made when earnings and valuations recover. If we can buy a company on a lower valuation than it historically trades at, on what we see as depressed earnings, this presents the opportunity for a compelling total return (although we will never be able to precisely forecast when end markets will turn). We do, however, need to admit where we think we have got things wrong and, in the case of advertising firm WPP, we sold the shares in April for £5.7, realising a substantial loss. The shares ended the year at £3.38, meaning the decision to sell limited realised losses. The reason for sale was that WPP's topline was declining faster than peers, leading us to conclude that there may be a structural reason why peers such as Publicis are taking market share at WPP's expense.

The bottom five contributors to performance during the year (in absolute terms) were:

Top five losses over one year

Stock	Depreciation	% Depreciation
Flutter Entertainment	(£7.4m)	(18.9)
Marshalls	(£4.9m)	(39.2)
Ibstock	(£2.4m)	(24.1)
Morgan Advanced Materials	(£2.2m)	(19.0)
WPP (no longer held)	(£2.2m)	(31.0)

Source: Law Debenture.

Note: % depreciation figures are share price only, not total return.

Medium Term Performance

One of the advantages of the Law Debenture structure, with the IPS business making a sizable contribution to the Trust's overall income, is that it allows us as portfolio managers to take a longer time horizon in investing. For example, we have the flexibility to hold low or zero dividend yield shares that we think have potential for substantial sales and earnings growth over the medium term. The uniqueness of the Trust structure allows us to hold these shares, and importantly remain patient with them over the following few years. We therefore think in time horizons longer than a year and, while the focus of an annual report tends to be on the past year, we also think it is important to take a step back and examine medium-term performance (in this case we have used three years).

Over the last three years, the Trust has generated a NAV total return of 59% (with debt at par), compared to a 47% return from the FTSE All-Share benchmark. If we examine what has driven that performance, what stands out is that five of the top ten contributors paid low or no dividends for at least some of the three-year period (Rolls-Royce, M&S, Kier, Babcock and Flutter). We would therefore have struggled to hold them in size in a traditional income fund structure, which was trying to meet or beat the benchmark dividend yield from the portfolio alone. These lower dividend yield holdings have generated substantial capital growth and, where we have taken profits along the way, this recycled capital can then generate future income growth for the portfolio. To give an example - the position in Rolls-Royce at the end of December 2022 was worth £8.8m. As at the end of December 2025, the holding was worth £18.7m - and along the way we have sold £62m worth of shares.

The top ten absolute contributors over the last three years were:

Top ten contributors over three years

Stock	Contribution to return (%)	Share price total return (%)
Rolls-Royce	9.5	1150
Barclays	4.4	237
HSBC	4.0	184
Marks & Spencer	2.7	174
Standard Chartered	2.1	218
Natwest	2.0	194
Kier	1.9	304
Babcock	1.9	350
Flutter Entertainment	1.6	43
Tesco	1.6	121

Source: Janus Henderson Investors, Bloomberg as at 31 December 2025.

Portfolio income

Investment income received grew from £34.7m in 2024, to £40.3m in 2025. This growth was partially driven by net investment during the year, on which we provide further detail in the portfolio activity section (below). Some of the specific sectors that were added to, such as commercial property and infrastructure, pay a dividend yield above that of the overall portfolio. We continue to have a total return focus for the portfolio as a whole rather than targeting a specific level of income generation.

Portfolio activity

During the year we were net investors of £53m. Despite this net investment, the rise in the net asset value of the Company meant that gearing was little changed on the year - it ended 2025 at 12%, compared to 11% as at the end of 2024.

The UK was the biggest source of investment, with net investment of £57m, as this was where we continued to see the most value. This net investment took the UK weight at year end to 89.9%, modestly higher than the 87.6% weight at the end of 2024 (which was already a historically high level). While UK equities performed well in 2025, they continue to trade at a substantial valuation discount to overseas equities. As the chart on page 23 of the full annual report and accounts shows, UK equities trade at an approximately 30% valuation discount on a non-sector adjusted basis, and a roughly 20% discount on a sector-adjusted basis (which largely reflects the lower weighting in the technology sector in the UK market).

The valuation discount also impacts corporate activity, where we continue to see heightened interest for UK companies from both financial and strategic buyers. This year there were takeover offers for instrumentation equipment producer Spectris, industrial chain manufacturer Renold, building materials company Epwin and overseas consumer lender International Personal Finance. The minimum takeover premium among these shares was around 25%, with the maximum (Spectris) around 100%. With the exception of IPF (where the position remains in the portfolio), corporate activity was often the driver of sales activity during the year, with the positions in Spectris, Renold and Epwin all subsequently sold. For as long as the valuation discount on UK equities remains, we would expect further corporate activity in the year ahead.

The largest sale during the year was Rolls-Royce, which was reduced for valuation reasons. A valuation metric we often use in the industrial space is enterprise value (market capitalisation plus debt) compared to revenue. A few years ago you could buy Rolls-Royce for roughly 1x its turnover, as there were question marks around its ability to generate cash, its level of indebtedness and, during Covid, severe weakness in its aerospace end-markets. Today, Rolls-Royce trades on approximately 5x turnover. It is seen as better managed and its end-markets have improved, but its valuation in our view now largely reflects this.

The largest purchases of the year included several commercial property owners such as British Land and Segro. We also added to several of the existing holdings in the sector, such as Workspace and Hammerson. In our view, there is currently a disconnect in the sector between the operating conditions, which are generally strong with good levels of rental growth and (with a few exceptions), low vacancies, and the share prices, which are often trading at steep discounts to the latest book value. This disconnect is likely due to the uncertainty surrounding government bond yields, however if we see interest rates come down further in 2026 (which we expect), we would hope that the gap between fundamentals and share prices begins to narrow. Another area that was added to in 2025 was infrastructure trusts, with new holdings such as Greencoat UK Wind and HICL, with a similar logic to commercial property - shares were trading at substantial discounts while offering attractive dividend yields.

Outlook

After the rise of last year, aggregate valuations for companies are obviously not as low as they were. However, they are still below their long-term averages. Perhaps, more importantly, expectations for earnings growth remain undemanding. It is surpassing of expectations that drives valuations up. Therefore, modest valuations and the possibility of better-than-expected operating profits as a result of falling interest rates can counter the concerns about geopolitical problems. The underlying macro-economic problem of recent years has been inflation. Interest rate increases have been the preferred Central Bank tool to fight inflation. There is increasing evidence that inflation will fall as wage pressure subsides and that, in turn, will allow interest rates to fall. Low expectations, falling interest rates and modest valuations are a combination that can lead to strong share prices. Therefore, the intention is to remain a buyer of a diverse range of equities in coming months.

James Henderson and Laura Foll

Investment managers

10 March 2026

Portfolio by Sector and Value

Portfolio by sector
2025		2024
Oil and gas	8.6%	Oil and gas	8.8%
Basic materials	6.1%	Basic materials	5.0%
Industrials	20.4%	Industrials	23.0%
Consumer goods	6.9%	Consumer goods	8.4%
Health care	5.8%	Health care	5.7%
Consumer services	9.6%	Consumer services	13.9%
Telecommunications	1.9%	Telecommunications	2.2%
Utilities	3.7%	Utilities	3.5%
Financials	33.5%	Financials	26.7%
Technology	1.5%	Technology	1.8%
Sustainable energy	2.0%

Geographical distribution of Portfolio by value
2025		2024
United Kingdom	90.2%	United Kingdom	87.6%
North America	4.4%	North America	5.6%
Europe	4.5%	Europe	5.5%
Japan	1.0%	Japan	1.3%

Fifteen Largest Holdings: Investment Rationale

as at 31 December 2025

Rank 2025	Company	Location		% of Portfolio	Approx Market Cap.	Valuation 2024 £000	Purchases £000	(Sales) £000	Appreciation/ (Depreciation) £000	Valuation 2025 £000
1.	Barclays	UK		4.07	£66.09bn	31,105	-	-	24,094	55,199
Barclays is one of the largest lenders in the UK as well as owning a global investment bank. It trades at a lower valuation than many of its banking sector peers because of scepticism that the investment bank can generate good returns. On evidence of better execution, it has potential to re-rate further from its current valuation.
2.	HSBC	UK		3.75	£200.19bn	34,055	-	-	16,805	50,860
HSBC is a large global lender and financial services business. It provides geographic diversification to the portfolio while becoming more focused on geographies where they are among the market leaders.
3.	Shell	UK		2.52	£156.19bn	30,950	-	-	3,294	34,244
Shell is a vertically integrated oil & gas company with significant exposure to natural gas within its production mix. The business is highly cash generative at current commodity prices, allowing attractive cash returns to shareholders as well as funding significant capital expenditure.
4.	Rio Tinto	UK		2.32	£68.01bn	17,711	6,922	-	6,830	31,463
Rio Tinto is a diversified miner with significant exposure to iron ore, copper and aluminium. As a result of its low position on the cost curve, it is able to remain cash generative despite volatility in commodity prices and pays an attractive dividend yield.
5.	GlaxoSmithKline	UK		2.2	£74.23bn	22,074	-	-	7,848	29,922
GSK is a global pharmaceutical company that is among the market leaders in areas such as vaccines and HIV. The shares trade at a valuation discount to global pharmaceutical peers that in our view is unjustified.
6.	Standard Chartered	UK		2.06	£41.33bn	18,642	-	(3,102)	12,425	27,965
A global bank providing international banking and financial services, with a particular focus on emerging markets. The position provides geographic diversification for the portfolio as well as being positively exposed to higher global interest rates.
7.	BP	UK		1.82	£65.7bn	22,398	-	-	2,269	24,667
BP is a vertically integrated oil & gas company. Similar to Shell it is highly cash generative at current commodity prices, providing optionality for the company to fund significant capital expenditure, return cash to shareholders via an attractive dividend yield and pay down debt.
8.	Flutter Entertainment		UK	1.66	£27.57bn	39,368	-	(9,336)	(7,450)	22,582
Flutter is a global gambling provider and owner of brands such as Paddy Power and Betfair. It is successfully rolling out in the US as states gradually legalise gambling, providing a potential route to substantial earnings growth in the long term.
9.	Balfour Beatty	UK		1.44	£3.53bn	12,572	-	-	7,027	19,599
The Company provides civil and specialist engineering and management services. They work on a range of projects including roads, railways, schools, military housing and airports. The UK accounts for more than 50% of total revenues. They are the leading company in their field of activity with strong management disciplines which has seen them through in a volatile time.
10.	National Grid	UK		1.42	£56.86bn	16,051	-	-	3,252	19,303
National Grid is a regulated utility company with operations in both the UK and the US. The need to reduce global carbon emissions is likely to increase demands on electricity networks and this could lead to faster regulated asset growth in future, driven by the need to increase grid capacity. The position brings defensive qualities and continues to pay an attractive dividend yield.
11.	Rolls Royce	UK		1.38	£89.69bn	23,881	-	(24,464)	19,262	18,679
Rolls-Royce is a designer and manufacturer of engines for use across a number of end markets, most materially civil aerospace. They have won significant market share on the next generation of wide-bodied planes, where flying hours have fully recovered (and now surpassed) pre Covid levels. Under the current CEO they are reducing costs and have laid out ambitious medium-term goals for cash generation.
12.	Lloyds Banking Group	UK		1.37	£56.34bn	5,478	5,619	-	7,569	18,666
The Company provides retail banking, mortgages, pensions, asset management, insurance and treasury services. It is focused in the UK with branches and offices across the nation. The balance of different banking activities brings a greater consistency of earnings than usually associated with banking.
13.	NatWest	UK		1.37	£52.27bn	13,068	-	(1,907)	7,415	18,576
The Bank, formerly known as the Royal Bank of Scotland, is the largest commercial bank in the UK. They offer a comprehensive range of banking products. The strong management disciplines place them well to grow and use their financial strength.
14.	Cummins	USA		1.31	£44.3bn	13,089	-	-	4,713	17,802
The Company designs, manufactures, distributes and services diesel and natural gas engines as well as power generation systems used, for example, in data centres where demand is growing strongly. 55% of the Company's revenues come from the US with the rest spread around the globe. They are the global leader in their field of activity.
15.	Aviva	UK		1.3	£20.44bn	12,058	-	-	5,549	17,607
The Company provides all classes of general and life assurances including fire, motor, marine, aviation and transport insurance. They also offer a variety of financial services including long-term savings and fund management. They recently bought Direct Line and will bring their strong underwriting disciplines and marketing to the expanded group.

Company Overview

Who we are

From its origins in 1889, Law Debenture has diversified to become a Group which provides our shareholders, clients and people with a unique combination of a Portfolio and an Independent Professional Services ('IPS') business.

Our purpose and objective

Our purpose is to deliver peace of mind for our shareholders, clients and people. This is central to our strategy, both at the Portfolio and IPS levels, and underpins the way we think and behave every day.

Our objective as an investment trust is to achieve long-term capital growth in real terms and steadily increasing income. The aim is to achieve a higher rate of total return than the FTSE Actuaries All-Share Index through investing in a diversified portfolio of stocks and ownership of the IPS business.

To our IPS clients we are trusted, independent experts who have 136 years of experience to call on in delivering vital aspects of their business cycle.

Our purpose and objective are underpinned by our corporate values of:

●      We believe it's possible.

●      We make change happen.

●      We are better together.

●      We never stop learning.

Our culture

Our purpose and values are central to our objective. They are reinforced by our culture as a business, which is one of excellence, independence and trust.

The Board endorses our purpose and values and is responsible for ensuring that our culture is aligned with our strategy by assessing, monitoring and challenging the same where appropriate. The Board discharges this duty by reviewing the relevant policies, practices and behaviours throughout the business including its own conduct as a Board and of its individual directors and by ensuring our stated purpose, values and objectives are reflected in its discussions and decision-making.

Some of the ways in which the Board monitors the Group's culture, with the assistance of its Committees, senior managers and external advisers, are by reviewing:

●     reports on the results of our quarterly eNPS surveys;

●      reports on stakeholder engagement as described on page 48 of the full annual report and accounts and our Section 172(1) Statement on pages 48 to 51 of the full annual report and accounts;

●     reports on risk management, internal controls, internal audits, compliance, anti-bribery and whistleblowing arrangements;

●     cyclical presentations from our Business and Department Heads at each Board meeting;

●     feedback from our key external advisers such as our external auditors and investment managers on their relationship with the relevant teams within the business;

●      reports on the diversity and inclusion of the Board and the IPS business and oversight of the statistics set out in the ESG section on page 56 and 57 of the full annual report and accounts; and

●      Board, Committee and individual directors' performance evaluations, the process and outcome of which is set out on page 77 of the full annual report and accounts.

We continue to hold annual culture weeks to embed, share and celebrate our values as a business.

We believe the culture of the Group is strong and a contributing factor to our consistent performance in challenging market conditions.

Our strategy - implementation

Our strategy is centred around the unique combination of the Portfolio and our IPS business. Whilst overseen by the Board, the IPS business operates independently from the Portfolio.

The IPS business provides a reliable source of revenue to the investment trust. This supports the dividend and ensures our investment managers are not constrained to choosing stocks solely based on yield. Instead, the investment managers benefit from increased flexibility in stock selection supporting the delivery of long-term capital growth.

Our unique structure is also tax efficient as some tax relief, arising from excess costs and interest payments which would otherwise be unutilised, can be passed from the Portfolio to the UK via Group Relief business reducing the tax liability for the Group and increasing shareholder returns.

The way in which we implemented the investment strategy during 2025 is described in more detail in the investment managers' review above.

Annual performance is set out on pages 2 to 33 of the full annual report and accounts, which contain tables, charts and data to explain performance both during the year under review and over the long-term. Performance against KPIs is discussed on page 38 of the full annual report and accounts.

Our business model

Our business model is designed to position the Company for optimal performance in the AIC UK Equity Income investment trust sector.

Law Debenture's shares are intended for private investors in the UK (retail investors), professionally advised private clients and institutional investors. When choosing an equity focused investment trust, shareholders typically accept the risk of exposure to equities but hope that the pooled nature of an investment trust portfolio will give some protection from the volatility in share price movements that can affect individual equities.

Total Shareholder Return

PORTFOLIO

●      Invests in a diverse equity portfolio

●      Earns capital returns and dividends

●      Low ongoing charges

INDEPENDENT PROFESSIONAL SERVICES

●      Trusted provider of independent governance services, generating recurring revenue.

●      Profits provide the investment trust with an additional revenue stream.

●      Tax efficient

PORTFOLIO

●      The Portfolio will typically contain over 70 and up to 175 stocks, the maximum permitted.

●      The Portfolio is diversified in order to spread investment risk with no obligation to hold shares in any particular type of  company or industry.

●      The IPS business does not form part of the Portfolio.

Whilst performance is measured against the FTSE Actuaries All-Share Index, the composition of the index does not influence the construction of the Portfolio. As a consequence, it is expected that the Portfolio and performance will deviate from the comparator index.

INDEPENDENT PROFESSIONAL SERVICES

Operating through a number of wholly owned subsidiary companies (see note 13 in the full annual report and accounts), we provide pension trustee executives, outsourced pension services, corporate trust services and corporate services to companies, agencies, organisations and individuals throughout the world. The services are provided through offices in the UK, Dublin, New York, Delaware, Hong Kong and the Channel Islands.

Group employees are employed by L.D.C. Trust Management Limited ('LDCTM') and Safecall Limited (in the UK) or a locally incorporated entity (in the overseas jurisdictions). As part of their duties, a number of the employees provide services to the investment trust and a proportion of their time and related overheads are recharged to the trust, forming part of the ongoing charges.

More details about the performance of the IPS business in 2025 are given in the Chief Executive Officer's review above.

Our strategy - guidelines

The Board sets the investment strategy and actively monitors both the investment managers' and Executive Leadership team's adherence through a series of guidelines and parameters in each scheduled Board meeting. The strategy is reviewed periodically to ensure we deliver on our objective.

Investments	Permitted types of investments are:	Restrictions:
	●  Equity Shares ●  Cash/Liquid Assets	●  Trading is not permitted in suspended shares or short positions ●  No more than 15% of gross assets will be invested in other UK listed investment trusts ●  No more than 175 stocks ●  No investment may be made which raises the aggregate value of the largest 20 holdings, excluding holdings in collective investment vehicles that give exposure to Japan, Asia/Pacific or emerging market regions, to more than 40% of the Portfolio, including gilts and cash ●  The value of a new acquisition in any one holding may not exceed 5% of the total Portfolio value (including cash) at the time the investment is made ●  Further additions shall not cause a single holding to exceed 5%, and Executive approval must be sought (to be reported at the next Board meeting), to retain a holding should its value increase above the 5% limit ●  No investment in any investment vehicle managed or advised by Janus Henderson shall be made without prior Board approval ●  No investment other than in equity shares quoted on a major international Stock Exchange (including AIM for the avoidance of doubt) or instruments convertible into the same may be made without prior Executive approval ●  The Company may not make investments in unlimited liability companies
	The current regional parameters are:		Minimum %	Maximum %
		United Kingdom	55	100
		North America	0	20
		Continental Europe	0	20
		Japan	0	10
		Asia/Pacific	0	10
		Other (including South America)	0	10
Derivatives	May be used with prior authorisation of the Board
Hedging	Currency hedges may be put in place with Board approval to protect against foreign exchange movements on the capital and income accounts
Stock-lending	Up to 30% of the market value of the Portfolio may be lent
Gearing	A ceiling on net gearing of 50% is applied. Typically net gearing, (i.e. gearing net of cash), is between 10% and 20% of the total Trust value. The Board retains the ability to reduce equity exposure so that net cash is above 10% if deemed appropriate. Refer to page 168 of the full annual report and accounts for calculation of gearing
Daily dealing limit	Net purchases in any dealing day are to be limited to £30 million unless prior Executive approval is obtained
Underwriting	Permitted capital at risk up to 5% of the value of the Portfolio
Corporate approval	Where indicated, the investment managers must obtain prior approval to exceed permitted limits either through Board or Executive approval. Executive approval shall be the approval of either the Board Chair or the Chief Executive Officer. The Board may make non-material adjustments or changes to the investment policy from time to time. Any changes to the investment policy, which the Board deem to be material, require prior shareholder approval

Agreement with the investment managers

The appointed investment managers are Janus Henderson Investors (JHI). James Henderson and Laura Foll are the individuals from JHI that deal with the day to day portfolio management.

On a fully discretionary basis, our investment managers are responsible for implementing the Company's investment strategy. The contract is terminable by either side on six months' notice.

The agreement with Janus Henderson does not cover custody, which is the responsibility of the depositary (see section on regulatory compliance in the Directors' Report, page 67 of the full annual report and accounts). It also does not cover the preparation of data associated with investment performance or record keeping, both of which remain the responsibility of the Company.

Fee structure and ongoing charges

Investment trusts are required to publish their ongoing charges ratio. This is the cost of operating the trust and includes the investment management fee, depositary and custody fees, investment performance data, accounting, company secretary and related back office administrative people and insurance costs.

The Group continues to have one of the more competitive fee structures in the UK Equity Income Sector. The investment management fee is charged at 0.30% p.a. of the net assets of the Group (excluding the net assets of IPS), calculated on the basis adopted in the audited financial statements. The management charge reduces to 0.275% for net assets over £1.5bn and 0.25% for assets over £2.5bn. The ongoing charges are 0.56%.

No performance fee is paid to the investment manager.

Reappointment of the investment managers

On an annual basis, at a minimum, the Board assesses whether the investment managers should be reappointed. The key criterion for assessment is the long-term performance of the Portfolio.

Given Janus Henderson's proven record of performance, and the competitive fee arrangements in place, the Board has concluded that the continued appointment of our existing investment managers remains in the interests of our shareholders.

Gearing and long-term borrowing

Investment trusts have the benefit of being able to 'gear' their portfolios according to market conditions. This means that they can raise debt (either short or long-term) to generate funds for further investment. These funds can be used to increase the size of the Portfolio. Alternatively, assets from within the Portfolio can be sold to reduce debt and the Portfolio can even be 'negatively geared'. This means selling assets to hold cash so that less than 100% of the Company's assets are invested in equities. At 31 December 2025, our gearing was 12% (2024: 11%) (refer to page 168 of the full annual report and accounts).

The Group has four debentures (long dated sterling denominated financing) details of which are on page 157 of the full annual report and accounts. The weighted average interest payable on the debentures is 3.96% (2024: 3.96%).

During the year, the Group made arrangements to put in place a £50m term loan and £50m revolving credit facility for a 3-year term. Interest is charged at Sterling Overnight Index Average ('SONIA') plus 140bp margin.

The fair value of borrowings held by the Group is disclosed in note 20 in the full annual report and accounts. The fair value calculation of all borrowings benchmarks the Group debt against A-rated UK corporate bond yields.

Valuation of our IPS business

Accounting standards require us to consolidate the income, costs and taxation of the IPS business into the Consolidated Statement of Profit or Loss below. The assets and liabilities of the business are also consolidated into the Group column of the statement of financial position below. A segmental analysis is provided in note 6 (pages 140 and 141 of the full annual report and accounts) to these accounts which shows a detailed breakdown of the split between the Portfolio and the IPS business.

Consolidating the value of the IPS business in this way does not fully recognise the value created for shareholder by the IPS business in the NAV. To address this, the NAV we publish for the Group includes the fair value for the standalone IPS business.

In determining the calculation basis for the fair valuation of the IPS business, the Board continues to take appropriate external professional advice from PwC.

From 31 December 2024, an income-based valuation approach was adopted that follows a discounted cashflow ("DCF") analysis based on business forecasts These are adjusted to reflect fair value assumptions a hypothetical third-party would apply in valuing the business. An appropriate cost of equity is determined through consideration of comparable entities to build a discount rate and applied to the discrete forecast period and projected free cashflows in estimating the terminal value. PwC provide a valuation range from which the Board select a value.

The calculation of the IPS valuation and methodology used is described in note 13 in the full annual report and accounts. As a cross check, the implied multiples for 31 December 2024 and 2025 are calculated by dividing the DCF IPS valuation by the underlying EBITDA (see APM on page 170 of the full annual report and accounts).

Valuation guidelines require that the fair value of the IPS business be established on a stand-alone basis. Therefore, the valuation does not reflect the value of Group tax relief applied from the investment trust to the IPS business.

It is hoped that our continued initiatives to achieve growth into the IPS business will result in a corresponding increase in valuation over time. As stated above, management is again aiming to achieve mid to high single percentage growth in 2026. The total valuation (excluding surplus net assets) of the business has increased by £130m/166% since the first valuation of the business as at 31 December 2015. The uplift reflects the IPS business delivering revenue and underlying profit growth.

In order to assist investors, the fair value of the IPS business for the last ten years is provided in the Annual Report within the 10-year record on page 41 of the full annual report and accounts.

Calculation of NAV per share

The table below shows how the NAV at fair value is calculated. The value of assets already included within the NAV per the Group statement of financial position that relate to the IPS business have been removed (£30.5m) and substituted with the calculation of the fair value and surplus net assets of the business £233.0m. An adjustment of (£11.2m) is made to reflect the third interim dividend unpaid at the year-end and included in reported NAV. A further adjustment of £47.0m is then made to show the Group's debt at fair value, rather than the amortised cost that is included in the NAV per the Group statement of financial position. This calculation shows a NAV fair value for the Group as at 31 December 2025 of £1,440.4m or 1,081.49 pence per share.

		31 December 2025	31 December 2024
	£000	Pence per share	£000	Pence per share
Net asset value (NAV) per Group statement of financial position*	1,202,075	902.58	931,371	706.18
Fair valuation of IPS	208,665	156.68	194,505	147.48
IPS Net Assets attributable to IPS valuation	24,378	18.30	18,811	14.26
Fair value of IPS business	233,043	174.98	213,316	161.74
Removal of IPS net assets included in Group net assets	(30,517)	(22.91)	(25,921)	(19.65)
Fair value uplift for IPS business	202,526	152.07	187,395	142.09
3rd Interim dividend, announced but unpaid at 31 December*	(11,216)	(8.42)	(10,607)	(8.04)
Debt fair value adjustment	46,972	35.27	42,353	32.11
NAV at fair value	1,440,357	1,081.49	1,150,512	872.34
NAV attributable to IPS	233,041	16%	213,316	19%

See commentary for the breakdown of the assets already included in the NAV per the financial statements.

The NAV at fair value per Annual Report is calculated above. This differs to the 'published' NAV at fair value for 31 December 2025 (year end NAV released by RNS on 2 January 2026). As such, please see below for a reconciliation:

	31 December 2025
	£000	Pence per share
Reconciliation of Published NAV to Annual Report NAV:
NAV cum income with debt at FV - published	1,436,253	1,078.41
Reconciliation of shareholders' funds to net assets:
Published NAV	(1,192,598)	(895.46)
Annual Report NAV*	1,202,075	902.58
Revised IPS valuation uplift:
Published NAV (valuation per 30 June 2025)	(196,705)	(147.70)
Annual Report NAV	202,526	152.07
Revised Fair Value of Debentures:
Published NAV	(46,950)	(35.25)
Annual Report NAV	46,972	35.27
3rd Interim dividend, announced but unpaid at 31 December*	(11,216)	(8.42)
Total NAV at fair value per Annual Report	1,440,357	1,081.49

 * The comparative has been restated to reflect dividend restatement removed from shareholders' funds. Refer to note below. The basis of the NAV at fair value is unchanged (Refer to APM on page 167 of the full annual report and accounts).

Our approach to risk

The Board has carried out a robust assessment of the principal and emerging risks and uncertainties facing the Group, including those that could threaten its business model, future performance, solvency, liquidity or reputation. The Group's risk management and internal control framework is embedded in everyday operations and subject to ongoing enhancements to ensure it remains effective and responsive to the evolving risk landscape.

During the year, the Board has evolved its risk management approach to facilitate more strategic, holistic oversight of risks across both the Investment Portfolio and the IPS business. This evolution represents a shift from compliance-focused risk oversight towards a comprehensive framework that concentrates on the risks most critical to the success of Law Debenture.

The objective of our risk management framework is not to eliminate all risks but to understand, appropriately mitigate and actively manage them while seeking to deliver on our strategic objectives. A mature risk management approach enables us to anticipate potential challenges, identify opportunities to support informed decision-making, and pursue growth and innovation while maintaining appropriate safeguards for the protection of shareholder value.

Governance and Oversight

The Audit and Risk Committee assists the Board by providing oversight of the Group's risk management framework and internal controls. The Committee's responsibilities include reviewing principal and emerging risks to the Group, assessing the adequacy of controls in place to mitigate those risks, receiving quarterly reports from the Group Risk team, and ensuring the risk management framework remains relevant and effective. 

Group risk summary and mitigating actions

PRINCIPAL GROUP RISKS	CHANGES TO RISK IN 2025	MITIGATING FACTORS
1. Investment Performance and Market Risk
The risk of the Portfolio failing to deliver and/or failing to consider and react to market conditions to deliver the strategic objectives to:	UNCHANGED Continued geopolitical tensions present elements of uncertainty, and global economic pressures continue to have an unfavourable impact on global markets and therefore the Portfolio. High global inflation in the year undermines the value of investment returns.	· Market risk is an accepted risk given the nature of the Portfolio. To manage this inherent risk, the Board regularly reviews the investment managers' report including risk indicators, MI, and other financial information. The Board engages in open dialogue, robust discussion and provides challenge to the investment managers on their approach and performance, seeking explanations from the investment managers where performance is not in line with our objectives.
· Achieve long-term capital growth.
· Deliver steadily increasing income
· Achieve a rate of return greater than the FTSE Actuaries All-Share Index, our benchmark.		· The investment trust is closed ended and therefore does not have to sell investments to provide liquidity to shareholders who wish to sell. This enables our investment managers to invest for the long-term.
The principal risk is a material decline in the value of the NAV and under-performance against the benchmark. Investment performance and market risk are the largest risks to which the Group is exposed. Our investment risk includes market risk, gearing risk, credit risk, leverage risk and liquidity risk.		·  To mitigate leverage risk, all borrowings require the prior approval of the Board and gearing ratios are kept under close review by the Board. We have substantial headroom on all of our debt covenants.
2. Cyber, Technology and Systems Risk
The threat of unauthorised or malicious attacks on our IT systems is an ongoing risk. We rely on a set of critical IT systems which are fundamental to the day-to-day running of the business, as in any technology-enabled business.	INCREASED Cyber threats continue to evolve, requiring ongoing vigilance and investment in resilience measures. We continue to strengthen our security posture through implementing enhanced access controls and data protection capabilities.	· The Group is Cyber Essentials Plus certified, the highest level of certification offered under the Government-backed, industry-supported Cyber Essentials scheme.
Failures in these systems could lead to reduced revenue, increased costs, liability claims, or harm to our reputation or competitive position. The systems of Janus Henderson, our investment managers, are also considered under this risk type.		· All staff trained on cyber security risks including phishing training and testing.
		· We are continually investing in our IT security framework including working with industry-recognised best-in-class security providers.
		· We have an information security governance structure to help identify and mitigate threats.
		· As part of our ongoing oversight of Janus Henderson's control environment, Law Debenture's Group Risk team have specifically reviewed their information security and business continuity/disaster recovery plans.
		· Industry standard cyber insurance is in place to mitigate financial loss.
3. IPS Concentration Risk
The unique setup of the Group as a Portfolio alongside an unquoted IPS business, which represents 16% of NAV and accounted for 30.9% of revenue return per share in 2025, creates an illiquid concentration risk.	UNCHANGED The IPS business includes some counter-cyclical services which may help to counteract any adverse market conditions for other business lines.	· The IPS business comprises a diversified range of services with little client concentration risk.
Failure to deliver on the IPS strategy could result in a significant reduction in valuation of the Group's largest asset, thereby putting pressure on our ability to meet our stated objective of long-term capital growth, and steadily increasing income.		· The CEO and COO are accountable for the day-to-day running and operation of the IPS business with independent oversight and challenge from the Non-Executive Directors. The performance of the IPS business is reviewed at all Board meetings.
IPS Concentration Risk also includes aggregation of litigation, compliance, regulatory and internal control failures and people risk.		· The annual IPS budget is subject to review and approval by the Board which provides robust scrutiny and challenge on IPS strategic plans.
		· Any significant IPS investment requires Board approval. This reduces the risk of unplanned concentration risk.
		·  Valuation of the IPS business takes into account the illiquid nature of the holding. This is reviewed and approved by the Audit and Risk Committee.
		· The Audit and Risk Committee has oversight of internal control findings from second/third line and external audit.

Emerging risks

Emerging risks are those identified by Law Debenture, where the potential impact and/or likelihood is not yet fully known. The firm monitors the evolution of these risks and associated mitigants.

Artificial Intelligence Adoption: The principal risk relating to artificial intelligence is the failure to adopt and integrate AI capabilities effectively. Organisations that do not develop appropriate AI strategies risk operational inefficiencies, reduced competitive positioning, and missed opportunities to enhance decision-making and risk management capabilities. Law Debenture continues to assess where AI can deliver meaningful value across the investment portfolio and IPS business, whilst developing appropriate governance frameworks to support effective implementation. 

Viability Statement

The Board has considered the Group's current financial position and the potential impact of its principal risks and uncertainties, and have a reasonable expectation that the Group will be able to continue in operation and meet its liabilities as they fall due for a period of five years from the date of in the full annual report and accounts.

In assessing the viability of the Group over the review period, the Board have considered a number of key factors, including:

Our business model & strategy

•  The Board seeks to ensure that the Group delivers long-term performance. The closed ended nature of the investment trust creates a stable capital basis which enables our Investment Manager's to take a longer term view in their construction and management of the portfolio. This mitigates the risk to the Group of potential liquidity issues should shareholders wish to sell their shares, avoiding any untimely requirements to sell down the portfolio.

•  As an Investment Trust, we benefit from the unique structure of a predominately UK-based equity portfolio with a diversified revenue stream arising from the IPS business. As demonstrated by our long-term performance, the combination of the Investment Portfolio and the IPS revenue streams provide protection to the long-term viability of the Group. Over a five year period, the share-price total return is 85.0%. The NAV total return with debt at FV is 96.6% compared to the FTSE Actuaries All-Index Total Return of 73.9%.

•  One of the principal group risks relates to investment strategy and market performance. Part of the risk to the Group is that a breach of our debt covenants resulting in a requirement for the Group to repay the debentures at short notice, potentially requiring the sale of assets during a market downturn. Whilst the Board acknowledges this risk, the uncertainty arising due to the Covid pandemic and more recently the macroeconomic environment demonstrates the Group's ability to navigate these challenges. At the height of market decline on 23 March 2020, the Group maintained significant headroom on all covenants.

•  The IPS business currently holds enough working capital to meet any short-term requirements of the Group and our book of clients provides a steady, largely reoccurring, flow of income. There has been a concerted focus on debtor management which has enhanced IPS cashflow over the past year, improving our working capital cycle.

Furthermore, the majority of the portfolio is invested in UK listed securities which are traded on major stock exchanges, providing the Group with the ability to quickly liquidate assets, should the need arise.

•  The investment Trust has an ongoing charge of 0.56% (2024: 0.51%). This is the fifth lowest OCR in the UK Equity Income sector¹.

1 Source: The AIC Compare investment companies | The AIC at 31/12/2025

Our Business Operations

· The investment trust retains ownership of all assets held by the Custodian under the terms of formal agreements with the Custodian and Depositary. This supports our ability to meet our Legal and Regulatory requirements and acts as a control to both verify the existence of our assets and further safeguard the interests of our Shareholders.

· The Group's cash is all held with banks approved by the Board. The Group's cash balance, including money market funds, as at 31 December 2025 amounted to £43.8m (31 December 2024: £38.4m) of which, IPS held £17.7m. Cash is treated as a fungible across the Group and it is deployed on a basis of need with periodic clear down of inter-company balances via an intra-group net-off agreement.

· There is long term borrowing in place comprising four debentures. Maturity date Par Value Interest 2034 £40m 6.125% 2041 £20m 2.54% 2045 £75m 3.77% 2050 £30m 2.53% Total £165m (weighted average) 3.96%

The weighted average cost of borrowing is 3.96%. Each debenture is subject to a formal agreement, including financial covenants which the Group has complied with in full during the year. As at the end of December, net gearing was 12% which is well within the typical operating range of 10%-20% of the Investment Trust sector.

·  During December 2025, the Group decided to put in place a £50m term loan and £50m revolving credit facility ("RCF") with RBSI, both for a 3-year term. The £50m unsecured overdraft facility previously held with HSBC was terminated. The RCF is currently undrawn and provides further mitigation against liquidity risk.

· The Board reviews the Portfolio performance including revenue forecasts, along with other key metrics such as gearing at each Board Meeting and receives monthly financial reporting to monitor and manage the principal risk relating to investment performance.

In addition to this, the Board carries out an assessment of our principal risks and uncertainties which could threaten the Group's business model. This assessment has been shared separately and is presented as part of the annual report. As part of this exercise, the Board has assessed the emerging risks which may impact the operations of the Group and will continue to actively review the likely impact of these potential risks. This is set out above.

The Board do not consider any ongoing geo-political events will have material impact on the long-term viability of the Group, given the headroom identified in the risk sensitivities from the far more extreme scenarios.

In light of the current conditions, the Board has considered the Group's current financial position and the potential impact of its principal risks and uncertainties, and has a reasonable expectation that the Group will be able to continue in operation and meet its liabilities as they fall due for a period of five years from the date of this report.

Balance sheet resilience

As at the 31 December 2025, Law Debenture Corporation held total investments, including cash and the IPS business of £1.60bn (31 December 2024: £1.30bn). With the exception of the IPS business, the majority of these assets are liquid and could be sold down within a short period of time, i.e. less than 10 working days.

The Board and the Executive Leadership team have actively monitored the cash position across the Group throughout the year, mindful of our commitment to pay quarterly dividends to shareholders. As of 31 December 2025, the Group holds cash of £43.8m (31 December 2024: £38.4m). In addition to this, the Group has an undrawn RCF facility of £50m to protect against any significant reduction in cash inflows.

Extracts from the Directors' Report

Repurchase and issue of shares

At the 2025 AGM, the Directors were given power to buy back up to 19,876,103 ordinary shares or, if less, the number of shares equal to 14.99% of the Company's issued share capital at that date. During the year, the Company did not repurchase any of its shares for cancellation. This authority will expire at the 2026 AGM. The Company intends to seek shareholder approval to renew its powers to repurchase shares for cancellation up to 14.99% of the Company's issued share capital if circumstances are appropriate, at the 2026 AGM.

The Directors were also given power to allot up to 26,519,150 ordinary shares at the 2025 AGM. From the 2025 AGM to 9 March 2026 the Company issued a total of 1,300,324 ordinary shares under its share issuance programme and its SAYE scheme. The authority will expire at the 2026 AGM at which the Company intends to seek shareholder approval to renew its powers to issue shares up to 20% of the Company's share capital in issue at 9 March 2026.

Donations

The Company made charitable donations totalling £1,200 (2024: £1,750 to Place2Be) to Mind Mental Health Charity, Marie Curie and Samaritans. The Company did not make any political donations (2024: £nil).

Share capital and significant shareholdings

The Company's share capital is made up of ordinary shares with a nominal value of 5 pence each. The voting rights of the shares on a poll are one vote for every share held. There are no restrictions on the transfer of the Company's ordinary shares or voting rights and no shares which carry specific rights with regard to the control of the Company. There are no other classes of share capital and none of the Company's issued shares are held in treasury. As at 31 December 2025, there were 133,921,079 ordinary shares in issue with 133,921,079 voting rights. Note 17 in the full annual report and accounts includes details of share capital changes in the year.

As at 31 December 2025, there were no shareholders that had notified the Company of a beneficial interest of 3% or more of the issued share capital. Additionally, no such disclosures had been made to the Company as at 10 March 2026. Share information as required by section 992 of the Companies Act 2006 appears at pages 37 and 150 of the full annual report and accounts.

Directors' responsibility statement pursuant to DTR4

The Directors confirm to the best of their knowledge that:

•    the financial statements have been prepared in accordance with international financial reporting standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union and give a true and fair view of the assets, liabilities, financial position and profit and loss of the Group; and

•     the Annual Report includes a fair review of the development and performance of the business and the financial position of the Group, together with a description of the principal risks and uncertainties that they face.

Extract from the Audit and Risk Committee Report

Significant financial issues relating to the 2025 accounts

The UK Corporate Governance Code requires the Committee to describe any significant issues considered in relation to the 2025 financial statements and how those issues were addressed.

The significant issues and judgements considered by the Committee include the valuation of IPS, IPS revenue recognition, debtor recoverability and discussions around the control environment.

In November 2025, Law Debenture received a letter from the Financial Reporting Council (FRC), as part of its regular review and assessment of corporate reporting in the UK, requesting further information in relation to the 2024 Annual Report and Accounts. The matters raised through this review were considered by the Committee, and all agreed changes have been incorporated into the 2025 financial statements, including the restatement of prior year comparatives, related to our incorrect inclusion of a liability for our third interim dividend at 31 December 2024, as set out in the note below. The Committee welcomed the FRC's review and its contribution to our shared objective of continually enhancing the quality and transparency of our corporate reporting.

No new significant issues arose during the course of the external audit. There continued to be a focus on embedding improved Finance operations and we have continued to make investments in this area to support the strategy for long term growth. We are pleased with the progress made and the improved control environment.

The Committee is satisfied that the judgements made by management are reasonable and that appropriate disclosures have been included in the accounts. The Committee was able to conclude and report to the Board that the financial statements themselves and the Annual Report as a whole are fair, balanced and understandable and provide the necessary information for shareholders to assess the Company and Group's position and performance, business model and strategy.

FINANCIAL STATEMENTS

Consolidated Statement of Profit or Loss

For the year ended 31 December 2025

	Note in the Annual Report	2025			2024
		Revenue £000	Capital £000	Total £000	Revenue £000	Capital £000	Total £000
UK dividends		37,172	-	37,172	32,328	-	32,328
UK special dividends		457	589	1,046	-	1,432	1,432
Overseas dividends		2,655	-	2,655	2,373	-	2,373
Total dividends income		40,284	589	40,873	34,701	1,432	36,133
Interest income	5	1,263	-	1,263	739	-	739
Independent professional service fees	6	66,699	-	66,699	61,659	-	61,659
Other Income		2,752	-	2,752	1,204	-	1,204
Total income		110,998	589	111,587	98,303	1,432	99,735
Net gain on investments held at fair value through P&L	2	-	262,650	262,650	-	76,301	76,301
Total income and capital gains		110,998	263,239	374,237	98,303	77,733	176,036
Cost of sales		(9,569)	-	(9,569)	(8,212)	-	(8,212)
Goodwill impairment	10	-	-	-	-	(17,037)	(17,037)
Administrative expenses	3	(47,265)	(3,120)	(50,385)	(42,685)	(2,706)	(45,391)
Operating profit		54,164	260,119	314,283	47,406	57,990	105,396
Interest payable	5	(2,306)	(4,908)	(7,214)	(1,640)	(4,908)	(6,548)
Profit before taxation	6	51,858	255,211	307,069	45,766	53,082	98,848
Taxation	7	(2,399)	-	(2,399)	(1,897)	-	(1,897)
Profit for the year	6	49,459	255,211	304,670	43,869	53,082	96,951
Return per ordinary share (pence)	9	37.26	192.28	229.54	33.48	40.51	73.99
Diluted return per ordinary share (pence)	9	37.26	192.24	229.50	33.48	40.51	73.99

Consolidated Statement of Comprehensive Income

For the year ended 31 December 2025

		2025			2024
GROUP	Note in the AnnualReport	Revenue £000	Capital £000	Total £000	Revenue £000	Capital £000	Total £000
Profit for the period		49,459	255,211	304,670	43,869	53,082	96,951
Foreign exchange (loss) on translation of foreign operations		(488)	(66)	(554)	(219)	(4,541)	(4,760)
Pension actuarial gains	23	1,718	-	1,718	2,738	-	2,738
Taxation	7	(529)	-	(529)	(499)	-	(499)
Other Comprehensive income/ (loss) for the year		701	(66)	635	2,020	(4,541)	(2,521)
Total comprehensive income for the period		50,160	255,145	305,305	45,889	48,541	94,430

Statement of Financial Position

As at 31 December 2025

Non current assets	Note in the Annual Report	GROUP			COMPANY
		31 Dec 2025 £000	Restated* 31 Dec 2024 £000	Restated* 1 Jan 2024 £000	31 Dec 2025 £000	Restated* 31 Dec 2024 £000	Restated* 1 Jan 2024 £000
Goodwill	10	1,937	1,976	19,006	-	-	-
Property, plant and equipment	11	1,480	1,958	2,267	-	-	-
Right-of-use assets	22	3,233	3,822	4,131	-	-	-
Other intangible assets	12	1,831	2,631	3,034	16	16	16
Investments held at fair value through profit or loss	13	1,357,645	1,042,039	965,226	1,357,645	1,041,938	965,126
Investments in subsidiary undertakings	13	-	-	-	61,071	61,176	61,368
Retirement benefit asset	23	12,531	10,475	7,440	-	-
Total non-current assets		1,378,657	1,062,901	1,001,104	1,418,732	1,103,130	1,026,510
Current assets
Trade and other receivables	14	14,647	17,758	21,496	4,003	2,700	3,014
Contract assets	14	7,239	6,659	8,604	246	4	-
Corporation tax receivable		1,263	-	-	-	-	-
Cash and cash equivalents	15	43,775	38,354	31,439	26,047	26,453	12,382
Total current assets		66,924	62,771	61,539	30,296	29,157	15,396
Total assets		1,445,581	1,125,672	1,062,643	1,449,028	1,132,287	1,041,906
Current liabilities
Amounts owed to subsidiary undertakings	19	-	-	-	29,186	25,537	18,558
Trade and other payables	16	9,786	8,382	12,550	1,909	1,182	1,020
Lease liability	22	708	1,018	1,025	-	-	-
Corporation tax payable		-	2,297	2,198	-	-	-
Other taxation including social security		1,815	2,266	1,842	-	25	839
Contract liabilities	16	7,696	8,996	8,000	11	10	8
Total current liabilities		20,005	22,959	25,615	31,106	26,754	20,425
Non-current liabilities and deferred income
Borrowings	20	213,918	163,868	163,889	174,313	124,295	124,343
Contract liabilities	16	3,481	1,866	2,403	-	-	-
Deferred tax liability	7	2,572	1,418	1,788	-	-	-
Lease Liability	22	3,530	4,190	4,716	-	-	-
Total non-current liabilities		223,501	171,342	172,796	174,313	124,295	124,343
Total net assets		1,202,075	931,371	864,232	1,243,609	981,238	897,138
Equity
Called up share capital	17	6,696	6,626	6,557	6,696	6,626	6,557
Share premium		11,144	119,449	107,110	11,144	119,449	107,110
Special Reserve (Non-Distributable)		160	-	-	160	-	-
Own shares	17	(5,770)	(5,156)	(3,926)	-	-	-
Capital redemption		8	8	8	8	8	8
Translation reserve		7,197	7,197	2,659	-	-	-
Capital reserves	18	997,962	742,817	694,276	1,065,136	810,265	740,145
Retained earnings		184,678	60,430	57,548	160,465	44,890	43,318
Total equity		1,202,075	931,371	864,232	1,243,609	981,238	897,138
Total equity pence per share		902.58	706.18	661.73

* Restated as per note below.

As permitted by Section 408 of the Companies Act 2006, the Company has not presented its own income statement. However, its profit for the year was £297,507k (2024: profit £114,793k). The financial statements were approved by the Board of Directors and authorised for issue on 10 March 2026. They were signed on its behalf by:

R. Hingley, Board Chair | D. Jackson, Chief Executive Officer

Consolidated Statement of Changes in Equity

As at 31 December 2025

Group Statement of Changes in Equity	Share capital £000	Share premium £000	Own shares £000	Special Reserve (Not Dist.) £000	Capital redemption £000	Translation reserve £000	Capital reserves £000	Retained earnings £000	Total £000
Balance at 1 January 2025 (Restated)	6,626	119,449	(5,156)	-	8	7,197	742,817	60,430	931,371
Profit for the period	-	-	-	-	-	-	255,211	49,459	304,670
Foreign exchange & other	-	-	-	-	-	-	(66)	(488)	(554)
Actuarial gain on pension scheme (net of tax)	-	-	-	-	-	-	-	1,189	1,189
Total comprehensive profit for the period	-	-	-	-	-	-	255,145	50,160	305,305
Issue of shares	70	11,573	(614)	-	-	-	-	-	11,029
Dividends relating to 2024	-	-	-	-	-	-	-	(23,203)	(23,203)
Dividends relating to 2025	-	-	-	-	-	-	-	(22,427)	(22,427)
Transfer from share premium	-	(119,878)	-	160	-	-	-	119,718	-
Total equity at 31 December 2025	6,696	11,144	(5,770)	160	8	7,197	997,962	184,678	1,202,075

Group Statement of Changes in Equity	Share capital £000	Share premium £000	Own shares £000	Special Reserve (Not Dist.) £000	Capital redemption £000	Translation reserve £000	Capital reserves £000	Retained earnings £000	Total £000
Balance at 1 January 2024	6,557	107,110	(3,926)	-	8	2,659	694,276	47,545	854,229
Effect of accrued dividend restatement (Note 29)	-	-	-	-	-	-	-	10,003	10,003
Balance at 1 January 2024 (Restated)	6,557	107,110	(3,926)	-	8	2,659	694,276	57,548	864,232
Profit for the period	-	-	-	-	-	-	53,082	43,869	96,951
Deconsolidation of liquidated entities	-	-	-	-	-	4,538	(4,538)	-	-
Foreign exchange & other	-	-	-	-	-	-	(3)	(219)	(222)
Actuarial gain on pension scheme (net of tax)	-	-	-	-	-	-	-	2,239	2,239
Total comprehensive profit for the period	-	-	-	-	-	4,538	48,541	45,889	98,968
Issue of shares	69	12,339	(1,230)	-	-	-	-	-	11,178
Dividends relating to 2023 (Restated)	-	-	-	-	-	-	-	(21,974)	(21,974)
Dividends relating to 2024 (Restated)	-	-	-	-	-	-	-	(21,033)	(21,033)
Total equity at 31 December 2024	6,626	119,449	(5,156)	-	8	7,197	742,817	60,430	931,371

Capital reserves comprise realised and unrealised gains and losses on investments held at fair value (see note 18 in the full annual report and accounts).

Please refer to Note 8 in the full annual report and accounts for details of dividends paid.

Please refer to note below for restatement of retained earnings.

Statement of Changes in Equity

As at 31 December 2025

Company Statement of Changes in Equity	Share capital £000	Share premium £000	Special Reserve (Not Dist.) £000	Capital redemption £000	Capital reserves £000	Retained earnings £000	Total £000
Balance at 1 January 2025 (Restated)	6,626	119,449	-	8	810,264	44,890	981,238
Profit for the period	-	-	-	-	255,211	42,296	297,507
Foreign exchange & other	-	-	-	-	(339)	(809)	(1,149)
Total comprehensive profit for the period	-	-	-	-	254,871	41,487	296,358
Issue of shares	70	11,573	-	-	-	-	11,643
Dividend relating to 2024	-	-	-	-	-	(23,203)	(23,203)
Dividends relating to 2025	-	-	-	-	-	(22,427)	(22,427)
Transfer from Share Premium	-	(119,878)	160	-	-	119,718	-
Total equity at 31 December 2025	6,696	11,144	160	8	1,065,136	160,465	1,243,609

Company Statement of Changes in Equity (Restated)	Share capital £000	Share premium £000	Special Reserve (Not Dist.) £000	Capital redemption £000	Capital reserves £000	Retained earnings £000	Total £000
Balance at 1 January 2024	6,557	107,110	-	8	740,146	33,315	887,135
Effect of accrued dividend restatement (Note 29)	-	-	-	-	-	10,003	10,003
Balance at 1 January 2024 (Restated)	6,557	107,110	-	8	740,146	43,318	897,138
Profit for the period	-	-	-	-	70,119	44,674	114,793
Foreign exchange & other	-	-	-	-	-	(95)	(95)
Total comprehensive profit for the period	-	-	-	-	70,119	44,579	114,698
Issue of shares	69	12,339	-	-	-	-	12,408
Dividend relating to 2023 (Restated)	-	-	-	-	-	(21,974)	(21,974)
Dividends relating to 2024 (Restated)	-	-	-	-	-	(21,033)	(21,033)
Total equity at 31 December 2024	6,626	119,449	-	8	810,265	44,890	981,238

Capital reserves comprise realised and unrealised gains and losses on investments held at fair value (see note 18 in the full annual report and accounts).

Please refer to note 8 in the full annual report and accounts for details of dividends paid.

Please refer to note below for restatement of retained earnings.

Cash Flow Statement

For the year ended 31 December 2025

	Notes in Annual Report	GROUP		COMPANY
		2025 £000	2024 £000	2025 £000	2024 £000
Cash flows from operating activities	28	16,937	11,070	(6,640)	(6,319)
Cash dividends received		39,568	36,578	47,772	50,828
Interest received	5	647	-	146	-
Taxation paid		(5,332)	(770)	-	-
Cash generated from operating activities		51,820	46,878	41,278	44,509
Investing activities
Acquisition of property, plant and equipment	11	(155)	(268)	-	-
Expenditure on intangible assets	12	(337)	(275)	-	-
Purchase of investments (less cost of acquisition)	13	(185,522)	(193,394)	(185,522)	(193,394)
Sale of investments	13	132,566	192,881	132,566	192,881
Interest received	5	-	739	-	449
Cash flow from investing activities		(53,448)	(317)	(52,956)	(64)
Financing activities
Interest paid		(7,131)	(6,294)	(7,240)	(6,652)
Dividends paid	8	(45,630)	(43,012)	(45,630)	(43,012)
Payment of lease liabilities	22	(1,256)	(1,295)	-	-
Proceeds from issuance of share capital		11,643	12,408	11,643	12,408
Purchase of own shares	17	(614)	(1,230)		-
Proceeds from new loans		50,000	-	50,000	-
Movement in amounts owed to subsidiary undertakings		-	-	2,501	6,977
Net cash flow from financing activities		7,012	(39,423)	11,274	(30,279)
Net increase/(decrease) in cash and cash equivalents		5,384	7,138	(404)	14,166
Cash and cash equivalents at beginning of year		38,354	31,439	26,453	12,382
Foreign exchange gains/(losses) on cash and cash equivalents		37	(223)	(2)	(95)
Cash and cash equivalents at end of period		43,775	38,354	26,047	26,453

Extracts from the Notes to the Accounts

Going concern

The Directors have considered the impact of the current economic uncertainty, across the Group, including cash flow forecasting, balance sheet review at entity level, a review of covenant compliance including the headroom above the covenants and an assessment of the liquidity of the Portfolio. Whilst the debentures held are subject to covenants, the Directors are comfortable that the risk of breach is minimal, and the current economic environment does not create material uncertainty for the Group.

The assets of the Group consist largely of securities that are readily realisable, and it will be able to meet its financial obligations, including the repayment of the debenture interest, as they fall due for a period of at least twelve months from the date of approval of the financial statements.

Accordingly, the Directors believe that the Group has adequate resources to continue in operational existence for at least twelve months from the date of approval of the financial statements.

Having assessed these factors and the principal risks, the Directors are not aware of any other material uncertainties that cast significant doubt on the Group's ability to continue as a going concern.

Segment analysis

Group Segmental Analysis	Investment Portfolio		IPS		Total
	2025 £000	2024* £000	2025 £000	2024 £000	2025 £000	2024* £000
Revenue
Dividend income	40,284	34,701	-	-	40,284	34,701
IPS Revenue:
Corporate Services	-	-	30,968	28,260	30,968	28,260
Corporate Trust	-	-	18,984	16,524	18,984	16,524
Pensions	-	-	16,747	16,875	16,747	16,875
Segment Income	40,284	34,701	66,699	61,659	106,983	96,360
Other Income	2,752	1,204	-	-	2,752	1,204
Cost of sales	(549)	(214)	(9,020)	(7,998)	(9,569)	(8,212)
Administration costs (note 3)	(6,245)	(4,025)	(41,020)	(38,660)	(47,265)	(42,685)
Profit before interest and tax	36,242	31,666	16,659	15,001	52,901	46,667
Interest payable (net) (note 5)	(2,088)	(1,184)	1,045	283	(1,043)	(901)
Profit before tax	34,154	30,482	17,704	15,284	51,858	45,766
Income Tax	-	-	(2,399)	(1,897)	(2,399)	(1,897)
Profit for the year	34,154	30,482	15,305	13,387	49,459	43,869
Revenue return per ordinary share (pence)	25.73	23.26	11.53	10.22	37.26	33.48
Assets	1,388,001	1,071,082	57,581	54,590	1,445,582	1,125,672
Liabilities	(216,443)	(165,632)	(27,064)	(28,669)	(243,507)	(194,301)
Total net assets	1,171,558	905,450	30,517	25,921	1,202,075	931,371

*2024 comparative liabilities have been restated refer to note below for further detail.

The table below shows the segment results adjusted for the goodwill impairment and non-recurring administration expenses, in IPS for FY24 only.

Adjusted profit before interest and tax	36,242	31,666	16,659	16,037	52,901	47,703
Adjusted profit before tax	34,154	30,482	17,704	16,320	51,858	46,802
Adjusted profit after tax	34,154	30,482	15,305	14,423	49,459	44,905
Adjusted revenue return per share	25.73	23.26	11.53	11.01	37.26	34.27

Geographic location of revenue: Approximately 92% of revenue is based in the UK. Geographic location is based on the jurisdiction in which the contracting legal entity is based.

Major customers: Due to the diverse nature of the IPS revenue streams, there is no single customer or concentration of customers that represents more than 3% of gross revenue streams.

Capital element: The capital element of the income statement comprises wholly gains and losses relating to investments held at fair value through profit and loss (2025: gains £262,650k; 2024: gains £76,301k), administrative expenses (2025: £3,120k; 2024: £2,706k), interest payable (2025: £4,908k; 2024: £4,908k) and a capital dividend received of 2025: £589k; 2024: £1,432k, which corresponds to amounts classified as capital in nature in accordance with the SORP are shown in the capital column of the income statement above.

	Investment Portfolio		Independent Professional Services		Total
	31 December 2025 £000	31 December 2024 £000	31 December 2025 £000	31 December 2024 £000	31 December 2025 £000	31 December 2024 £000
Other Information
Capital expenditure	-	-	492	912	492	912
Depreciation and amortisation	-	-	1,740	1,584	1,740	1,584
Depreciation - right-of-use assets	-	-	885	719	885	719

Financial instruments

The principal risks facing the Group in respect of its financial instruments remain unchanged from 2024 and are:

Market risk

Price risk, arising from uncertainty in the future value of financial instruments. The Board maintains strategy guidelines whereby risk is spread over a range of investments, the number of holdings normally being between 70 and 175. In addition, the stock selections and transactions are actively monitored throughout the year by the investment manager, who reports to the Board on a regular basis to review past performance and develop future strategy. The Portfolio is exposed to market price fluctuation: if the valuation at 31 December 2025 fell or rose by 10%, the impact on the Group's total capital reserves for the year would have been £135.8m (2024: £104.2m).

Corresponding 10% changes in the valuation of the Portfolio on the Company's total capital reserves for the year would have been £135.8m (2024: £104.2m). 10% has been used based on historic trends, however we will continue to revisit this on a periodic basis.

Foreign currency risk, arising from movements in currency rates applicable to the Group's investment in equities and fixed interest securities and the net assets of the Group's overseas subsidiaries denominated in currencies other than sterling. The Group's financial assets denominated in currencies other than sterling were:

	2025			2024
GROUP	Investments £000	Net monetary assets £000	Total currency exposure £000	Investments £000	Net monetary assets £000	Total currency exposure £000
US Dollar	48,461	2,848	51,309	41,391	4,101	45,492
Canadian Dollar	6,334	1	6,335	6,329	-	6,329
Euro	49,769	321	50,090	44,247	410	44,657
Danish Krone	-	-	-	4,935	-	4,935
Swiss Franc	9,386	-	9,386	5,268	-	5,268
Hong Kong Dollar	-	317	317	-	311	311
Japanese Yen	13,111	-	13,111	13,190	-	13,190
South African Rand	3,553	-	3,553	-	-	-
Total	130,614	3,487	134,101	115,360	4,822	120,182

 The Group US dollar net monetary assets is that held by the US operations of £1.6m (2024: £2.0m) together with £1.3m (2024: £1.4m) held by non-US operations.

	2025			2024
COMPANY	Investments £000	Net monetary assets £000	Total currency exposure £000	Investments £000	Net monetary assets £000	Total currency exposure £000
US Dollar	48,461	-	48,461	41,391	-	41,391
Canadian Dollar	6,334	-	6,334	6,329	-	6,329
Euro	49,769	-	49,769	44,247	-	44,247
Danish Krone	-	-	-	4,935	-	4,935
Swiss Franc	9,386	-	9,386	5,268	-	5,268
Japanese Yen	13,111	-	13,111	13,190	-	13,190
South African Rand	3,553		3,553
Total	130,614	-	130,614	115,360	-	115,360

The holding in Scottish Oriental Smaller Companies Trust is denominated in sterling but has underlying assets in foreign currencies equivalent to £8.7m (2024: £9.4m). Investments made in the UK and overseas have underlying assets and income streams in foreign currencies which cannot easily be determined and have not been included in the sensitivity analysis. If the value of all other currencies at 31 December 2025 rose or fell by 10% against sterling, the impact on the Group's total profit or loss for the year would have been £14.5m and £11.9m respectively (2024: £12.8m and £10.5m). Corresponding 10% changes in currency values on the Company's total profit or loss for the year would have been the same. The calculations are based on the Portfolio at the respective year end dates and are not representative of the year as a whole.

Interest rate risk, arising from movements in interest rates on borrowing, deposits and short-term investments. The Board reviews the mix of fixed and floating rate exposures and ensures that gearing levels are appropriate to the current and anticipated market environment. The Group's interest rate profile was:

			2025
			GROUP				COMPANY
	Sterling £000	HK Dollars £000		US Dollars £000	Euro £000	AU Dollars £000	Sterling £000	US Dollars £000	Euro £000
Floating rate assets	40,223	358		2,848	321	25	26,047	-	-

			2024
			GROUP				COMPANY
	Sterling £000	HK Dollars £000		US Dollars £000	Euro £000	AU Dollars £000	Sterling £000	US Dollars £000	Euro £000
Floating rate assets	33,484	311		4,101	410	-	26,453	-	-

The Group holds cash and cash equivalents on short-term bank deposits and money market funds. Interest rates tend to vary with bank base rates. The Portfolio is not directly exposed to interest rate risk.

	GROUP		COMPANY
	2025 Sterling £000	2024 Sterling £000	2025 Sterling £000	2024 Sterling £000
Fixed rate liabilities	163,919	163,868	124,313	124,295
Weighted average fixed rate for the year	3.96%	3.96%	3.27%	3.27%

	GROUP		COMPANY
	2025 Sterling £000	2024 Sterling £000	2025 Sterling £000	2024 Sterling £000
Floating rate liabilities	50,000	-	50,000	-
Weighted average fixed rate for the year	5.13%	-	5.13%	-

If interest rates during the year were 1.0% higher the impact on the Group's total profit or loss for the year would have been £300,000 credit (2024: £256,000 credit). It is assumed that interest rates are unlikely to fall below the current level.

The Company holds cash and cash equivalents on short-term bank deposits and money market funds, it also has borrowings. Amounts owed to subsidiary undertakings include £40m at a fixed rate. Interest rates on cash and cash equivalents and amounts due to subsidiary undertakings at floating rates tend to vary with bank base rates. A 1.0% increase in interest rates would have affected the Company's profit or loss for the year by £197,000 credit (2024: £145,000 credit). The calculations are based on the balances at the respective year end dates and are not representative of the year as a whole.

Liquidity risk

Is the risk arising from any difficulty in realising assets or raising funds to meet commitments associated with any of the above financial instruments. To minimise this risk, the Board's strategy largely limits investments to equities and fixed interest securities quoted in major financial markets. In addition, cash balances are maintained commensurate with likely future settlements. The maturity of the Group's existing borrowings is set out in note 20 in the full annual report and accounts. The interest on borrowings is paid bi-annually on March and September for the 2045 secured senior notes, April and October for the 2034 secured bonds and May and November for the 2041 and 2050 senior secured notes. Interest on term loan is paid quarterly on March, June, September and December. Refer to note 20 in the full annual report and accounts for details of financial covenants attached to the loan notes.

Credit risk

Credit risk is the risk arising from the failure of another party to perform according to the terms of their contract.

The Group's maximum exposure to credit risk arising from financial assets is £58.4m (2024: £56.1m). The Company's maximum exposure to credit risk arising from financial assets is £30.0m (2024: £29.2m).

Cash and cash equivalents are held with banks which are rated "A-" or higher by Standard & Poor's Rating Services. The credit risk on liquid funds and borrowings is limited because the counterparties are banks with high credit-ratings assigned by international credit rating agencies.

Credit risk arises on outstanding trade receivables, principally from clients in the IPS business. The Group manages credit risk through a combination of upfront client due diligence, contractual payment terms and ongoing monitoring of outstanding balances. Additionally, the Group's client base is diversified across multiple sectors and jurisdictions, which mitigates concentration risk. Reviews are undertaken to ensure that on an ongoing basis no client accounts for a significant proportion of revenue and trade receivables.

Specific provisions are made when there is evidence that the Group will not be able to collect the debts from the customer and the Group writes off a trade receivable when there is information indicating that there is no realistic prospect of recovery. The ageing of trade receivables and the expected credit loss at the reporting date are disclosed on page 156 in the full annual report and accounts.

Stock lending

Stock lending agreements are transactions in which the Group lends securities for a fee and receives cash as collateral. The Group continues to recognise the securities in their entirety in the statement of financial position because it retains substantially all of the risks and rewards of ownership. Because as part of the lending arrangement the Group sells the contractual rights to the cash flows of the securities, it does not have the ability to use the transferred assets during the term of the arrangement.

Stock lending transactions are carried out with a number of approved counterparties. Details of the value of securities on loan at the year end can be found in note 27 in the full annual report and accounts. In summary, the Group only transacts with counterparties that it considers to be credit worthy.

Trade and other receivables

The ageing profile of the carrying value of trade receivables past due is as follows:

	GROUP		COMPANY
	2025 £000	2024 £000	2025 £000	2024 £000
Between 31 and 60 days	1,055	2,474	-	-
Between 61 and 90 days	561	2,476	-	-
More than 91 days	2,167	5,125	3	36
Total	3,783	10,075	3	36

IFRS 9 credit loss rates

The Group applies the IFRS 9 simplified approach to measuring expected credit losses using a lifetime expected credit loss provision for trade receivables and contract assets. To measure expected credit losses trade receivables are grouped based on similar risk characteristics including business area and business geography and ageing.

The expected loss rates are estimated using the Group's historical credit losses experienced over a three-year period prior to the year end. The historical loss rates are adjusted for current and forward-looking information on macroeconomic factors affecting the Group's customers. The Group has identified gross domestic product (GDP) and unemployment trends act as key economic indicators which may impact our customers' future ability to pay debt.

The below table displays the gross carrying amount against the expected credit loss provision and specific provisions. Specific provisions relate to certain balances 91+ days overdue and the Group writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery.

The total specific and credit loss provision at 31 December 2025 is £1,576,000 (2024: £1,975,000).

The loss allowance as at 31 December 2025 was determined as follows:

Trade receivables - days past due
	Current £000	1 - 30 days overdue £000	31 - 60 days overdue £000	61 - 90 days overdue £000	91+ days overdue £000	Total £000
31 December 2025
Expected loss rate	1.01%	1.52%	1.03%	1.04%	3.02%	1.50%
Gross carrying amount	4,952	1,533	1,055	561	2,064	10,165
Expected credit loss provision	(50)	(23)	(11)	(6)	(62)	(152)
Specific provision	-	-	-	-	(1,423)	(1,423)
Net carrying amount	4,902	1,510	1,044	555	579	8,590

 The loss allowance as at 31 December 2024 was determined as follows:

Trade receivables - days past due
	Current £000	1 - 30 days overdue £000	31 - 60 days overdue £000	61 - 90 days overdue £000	91+ days overdue £000	Total £000
31 December 2024
Expected loss rate	2.94%	3.10%	3.42%	3.48%	4.35%	3.60%
Gross carrying amount	1,541	4,089	2,474	2,476	5,125	15,705
Expected credit loss provision	(45)	(127)	(85)	(86)	(223)	(566)
Specific provision	-	-	-	-	(1,409)	(1,409)
Net carrying amount	1,496	3,962	2,389	2,390	3,493	13,730

Trade and other payables
	GROUP		COMPANY
	2025 £000	Restated 2024 £000	2025 £000	Restated 2024 £000
Due in less than one month	9,786	8,382	1,909	1,182
Due in more than one month and less than three months	-	-	-	-
Total	9,786	8,382	1,909	1,182

Fair value

The Directors are of the opinion that the fair value of financial assets and liabilities of the Group is not materially different from their carrying values in the statement of financial position, with the exception of the borrowings (see note 20 in the full annual report and accounts).

Derecognition - financial assets

The Group enters into stock lending transactions whereby it transfers assets recognised on its statement of financial position, but retains either all or substantially all of the risks and rewards of the transferred assets or a portion of them. In such cases, the transferred assets are not derecognised.

Related party transactions

GROUP

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation.

COMPANY

The related party transactions between the Company and its wholly owned subsidiary undertakings are summarised as follows:

	2025 £000	2024 £000
Dividends from subsidiaries	8,200	14,250
Interest on intercompany balances charged by subsidiaries	721	721
Management charges from subsidiaries	2,095	1,000

The ultimate parent entity is The Law Debenture Corporation p.l.c.

Amounts owed to subsidiary undertakings represent intercompany loans which are unsecured, interest-free and repayable on demand. These are presented net due to the intercompany netting agreement (see accounting policies in the full annual report and accounts).

Key management personnel costs The key management personnel are the Directors of the Company and are those persons having authority and responsibility for planning, directing and controlling the activities of the entity. Details of their compensation are included in note 4 to the accounts on page 139 of the full annual report and accounts and in Parts 2-4 of the Remuneration Report on page 89 to 101 of the full annual report and accounts. Key management personnel costs are £2,201k (2024: £1,879k).

Prior year restatement

Following a routine review by the Financial Reporting Council (FRC) during the year, the Group received correspondence from the FRC requesting further information relating to the Group's 2024 Annual Report and Financial Statements. The FRC's review is limited to the published Annual Report and Financial Statements and does not involve a detailed examination of underlying transactions, nor does it provide assurance that the Annual Report and Financial Statements are correct in all material respects. As a result of this enquiry, the Group and Company's Statement of financial position as at 31 December 2024 were restated to remove the liability previously recognised for the 2024 third interim dividend (£10,607k), which was announced on 12 December 2024, but unpaid as at 31 December 2024. The related opening balances as at 1 January 2024 were also restated to remove the liability for the 2023 third interim dividend (£10,003k), which was announced on 14 December 2023 but unpaid as at 31 December 2023. As at 31 December 2024, this resulted in an increase in Retained Earnings of £10,607k and a corresponding increase in Total Net Assets. This restatement has been made to align the accounting treatment for interim dividends with the Group's accounting policy for dividends as set out in Note 1, whereby interim dividends are only recognised when they are paid. Consistent treatment, in line with the Group's accounting policy has been applied at 31 December 2025 and will be applied in future reporting periods. The financial statement line items affected in the prior years are as follows:

		Group			Company
		2024 £000	Increase/ (decrease) £000	31 Dec 2024 (restated) £000	2024 £000	Increase/ (decrease) £000	31 Dec 2024 (restated) £000
Statement of Financial Position	Trade and other payables	18,989	(10,607)	8,382	11,789	(10,607)	1,182
	Total net assets	920,764	10,607	931,371	970,631	10,607	981,238
	Total equity	920,764	10,607	931,371	970,631	10,607	981,238
Statement of Changes in Equity	Retained earnings 1 January 2024	47,545	10,003	57,548	33,315	10,003	43,318
	Total equity 1 January 2024	854,229	10,003	864,232	887,135	10,003	897,138
	Dividend relating to 2023	(11,971)	(10,003)	(21,974)	(11,971)	(10,003)	(21,974)
	Dividend relating to 2024	(31,640)	10,607	(21,033)	(31,640)	10,607	(21,033)
	Retained earnings 31 December 2024	49,823	10,607	60,430	34,283	10,607	44,890
	Total equity	920,764	10,607	931,371	970,631	10,607	981,238

		Group			Company
		1 Jan 2024 £000	Increase/ (decrease) £000	1 Jan 2024 (restated) £000	1 Jan 2024 £000	Increase/ (decrease) £000	1 Jan 2024 (restated) £000
Statement of Financial Position	Trade and other payables: Current	22,553	(10,003)	12,550	11,023	(10,003)	1,020
	Total Net Assets	854,229	10,003	864,232	887,135	10,003	897,138
	Total equity	854,229	10,003	864,232	887,135	10,003	897,138

Annual General Meeting (AGM)

The 136^th AGM will be held in-person at the offices of Peel Hunt, 7th Floor, 100 Liverpool Street, London EC2M 2AT on 24 April 2026 at 11.00am. Further details are included in the Notice of AGM included in the full annual report and accounts.

Access to the Annual Report

The annual report and accounts will shortly be available for download from the National Storage Mechanism at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.

CORPORATE INFORMATION

Company Advisers and Information

Directors Robert Hingley*+ Pars Purewal# Claire Finn~ Clare Askem Maarten Slendebroek Denis Jackson Trish Houston *Chairman of the Board +Chairman of the Nomination Committee ~ Chairman of the Remuneration Committee #Chairman of the Audit and Risk Committee	Investment portfolio manager Janus Henderson Global Investors 201 Bishopsgate, London EC2M 3AE Investment managers James Henderson and Laura Foll are joint managers. They also manage Lowland Investment Company plc and the Henderson UK Equity Income & Growth Fund. James joined Henderson Global Investors (now Janus Henderson Investors) in 1983 and has been an investment trust portfolio manager since 1990. He first became involved in the management of Law Debenture's portfolio in 1994 and took over lead responsibility for management of the portfolio in June 2003. Laura joined Janus Henderson Investors in 2009 and has held the position of portfolio manager on the Global Equity Income team since 2014. She first became involved with Law Debenture's portfolio in September 2011 and became joint portfolio manager in 2020.
Website https://www.lawdebenture.com Registrar Computershare Investor Services PLC The Pavilions, Bridgwater Road, Bristol BS99 6ZZ T: 0370 707 1129 Auditors Deloitte LLP, 110 Queen Street, Glasgow, G1 3BX Alternative Investment Fund Manager The Law Debenture Corporation p.l.c. Authorised and regulated by the Financial Conduct Authority as an internally managed Alternative Investment Fund. Firm Reference Number: 629081
Global custodian HSBC Bank plc (under delegation by the depositary) 8 Canada Square, London E14 5HQ
Joint brokers J.P. Morgan Securities PLC 25 Bank Street, London E14 5JP Peel Hunt LLP 100 Liverpool Street, London, EC2M 2AT
Depositary NatWest Trustee and Depositary Services Limited 250 Bishopsgate, London EC2M 4AA

The Law Debenture Corporation p.l.c. is registered in England, company registration number 30397. LEI number - 2138006E39QX7XV6PP21

 

END