Annual Financial Report

Rothschild & Co Continuation Fin

25 April 2025

 

Rothschild & Co Continuation Finance PLC

Directors' Report and Financial Statements

for the year ended 31 December 2024

Strategic Report

Business Model and Strategic Objectives

Rothschild & Co Continuation Finance PLC ("the Company") is a wholly-owned subsidiary of N. M. Rothschild & Sons Limited ("NMR") and was incorporated on 30 August 2000 to operate as a finance vehicle for the benefit of NMR and its subsidiaries. 

The principal activity of the Company is the raising of finance for the purpose of lending it to NMR and other companies in the Rothschild & Co Group ("the R&Co Group").  The only current debt securities in issue are the perpetual subordinated notes guaranteed by NMR.

Business Update and Key Performance Indicators

As mentioned above, the Company operates as a finance vehicle which issues debt and lends it onto R&Co Group companies on substantially the same terms.  The only debt currently in issue is perpetual subordinated notes.  Given the nature of this debt and the related loans to its immediate parent, the Directors consider that accrual accounting best reflects the purpose of the Company as a pass through financing vehicle and to match the €150m loan asset and subordinated guaranteed notes in issue. On this basis, the loan asset and subordinated guaranteed notes would be matched on the balance sheet at £124m to reflect the real asset and liability position of the Company.

However, IFRS 9 requires the Company to report the loan asset, and the Company has elected to report the subordinated guaranteed notes in issue, at fair value of c.£96m. Both the loans and subordinated guaranteed notes will continue to be taxed on an amortised cost basis so a net deferred tax liability of £46,513 (2023: £45,844) has been recognised on the difference between this and the carrying values. Negative movements in the valuation of the asset and liability resulted in a small accounting loss being reported for the year. However, the Company remains well capitalised. No KPIs are monitored on an on-going basis.

Principal Risks and Uncertainties

The principal risks of the Company are credit risk, liquidity risk, market risk and operational risk.  The Company follows the risk management policies of the immediate parent, NMR.

The Company's principal risk is credit exposure to NMR, as the notes issued by the Company have been guaranteed by, and funds have been on-lent to NMR. The Company is therefore reliant on the ability of NMR to meet its obligations under these lending arrangements. NMR has sufficient liquidity to continue to operate for at least the next 12 months even in the scenario where revenue is significantly reduced. Management has considered the going concern basis of preparation to be appropriate as outlined in note 1 to the financial statements.

The Company's market risk exposure is limited to interest rate and currency exchange rate movements.  Exposure to interest rate movements on the perpetual subordinated note issues has been passed to NMR, as the issue proceeds have been lent onwards to NMR at a fixed margin of one basis point above the rate being paid. Currency risk is not considered significant as all material foreign currency balances and cash flows are matched. 

Liquidity risk has similarly been transferred to NMR as the funds on-lent have the same maturity dates as the notes issued.  Operational risk arising from inadequate or failed internal processes, people and systems or from external events is managed by maintaining a strong framework of internal controls. 

Total shareholders' equity as at 31 December 2024 amounts to £410,475 (31 December 2023: £417,636) and the result for the year to 31 December 2024 amounts to a loss of £7,161 (2023: £6,554 loss).

The interest rate charged on the €150 million loan is EUR-TEC10-CNO plus 36 basis points, capped at 9.01 per cent, fixed on 05 February, 05 May, 05 August and 05 November each year. The maturity matches that of the subordinated guaranteed notes. The interest rate on the above loan at 31 December 2024 was 3.52% (2023: 3.66%).

The interest rate payable on the €150 million Perpetual Subordinated Notes is EUR-TEC10-CNO plus 35 basis points, capped at 9 per cent, fixed on 05 February, 05 May, 05 August and 05 November each year.  From and including the interest payment date falling in August 2016 and every interest payment date thereafter, the Company may redeem all of the Perpetual Subordinated Notes at their principal amount. There is no plan to redeem the notes over the next 12-month period. The interest rate on the above notes at 31 December 2024 was 3.51% (2023: 3.65%).

S172 statement

The Board has a duty under s172 of the Companies Act 2006 to promote the success of the Company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to:

a)	the likely consequences of any decision in the long term,
b)	the interests of the Company's employees,
c)	the need to foster the Company's business relationships with suppliers, customers and others,
d)	the impact of the Company's operations on the community and the environment,
e)	the desirability of the Company maintaining a reputation for high standards of business conduct, and
f)	the need to act fairly as between members of the Company.

During the year the Board has considered its duties under s172 and how it fulfils its obligations thereof. Given that the Company has no staff and limited suppliers, the key stakeholders are thought to be shareholders, investors, noteholders, regulators and tax authorities:

Shareholders

The Board is appointed by the shareholders to oversee, govern and make decisions on their behalf and so is directly responsible for protecting and managing their interests in the Company. It does this by setting the strategies, policies and corporate governance structures described earlier. As part of the wider R&Co Group, some of these responsibilities are managed at a group level and described in greater detail in the R&Co Group financial statements that are available on https://www.rothschildandco.com/en/about-us/results-reports/.  

Regulators and tax authorities

The Company insists on the highest standards of professionalism and integrity from those that act on its behalf who are expected to refrain from any conduct or behaviours that could be perceived unfavourably. This extends to dealing honestly and openly with regulators and tax authorities and in compliance with all the relevant laws and regulations in place.

By Order of the Board

Peter Barbour                                                                                     

Director                                                                                                

24 April 2025

Directors' Report

The Directors present their Directors' report and the financial statements for the year ended 31 December 2024.

Dividends

During the year, the Company did not pay any dividends (2023: £nil).

Directors

The Directors who held office during the year were as follows:

Peter Barbour

Christopher Coleman

Peter Whiteland

Mark Crump (resigned 3 May 2024)

Directors' Indemnity

The Company has provided qualifying third-party indemnities for the benefit of its Directors.  These were provided during the year and remain in force at the date of this report.  

Corporate Governance

The Directors have been charged with governance in accordance with the perpetual subordinated notes transaction documents describing the structure and operation of the transaction.  The responsibilities of the Directors to both noteholders and shareholders were established at the time of issuance.  Additionally, the Company is an integral part of the wider R&Co Group and, as such, benefits from the Group's wider control frameworks and structures, whilst also ensuring that the obligations and requirements of the Company are fully met. 

The Company follows the internal control policies of its immediate parent, NMR in maintaining its financial records and preparing its financial reporting.  Moreover, the key risks arising from the Company's activities involving the perpetual subordinated notes are monitored as part of the Group's control structures. However, it is the Directors opinion that these risks are limited in nature due to the low level of transactions occurring and the risk management framework in place.

Due to the nature of the perpetual subordinated notes which have been issued, the Company is largely exempt from the disclosure requirements of the Financial Conduct Authority pertaining to the Disclosure and Transparency Rules ("DTR") as detailed in the DTR 7.1 Audit committees and 7.2 Corporate governance statements (save for DTR 7.2.5 requiring a description of the features of the internal control and risk management systems), which would otherwise require the Company respectively, to have an audit committee in place and include a corporate governance statement in the Directors' Report.  The Directors are therefore satisfied that there is no requirement for an audit committee, or a supervisory board entrusted to carry out the functions of an audit committee or to publish a more extensive corporate governance statement. 

Auditor

Following a competitive tender process during the year, KPMG LLP resigned as auditor and Forvis Mazars LLP was appointed in their place on 18^th July 2024. Forvis Mazars LLP have indicated their willingness to continue in office as auditor and will be proposed for re-appointment.

Audit Information

The Directors who held office at the date of approval of this Report of the Directors confirm that, so far as they are each aware, there is no relevant audit information of which the Company's auditors are unaware, and each Director has taken all the steps that he or she ought to have taken as a Director to make himself or herself aware of any relevant audit information and to establish that the Company's auditors are aware of that information. 

Financial Instruments

Details of the Company's financial risk management objectives and policies, and exposure to risk are described in the financial statements. For more details refer to Note 2.

By Order of the Board

Peter Barbour                                                                                     

Director                                                                                                

24 April 2025

Statement of Directors' responsibilities in respect of the strategic report, Directors' report and the financial statements 

The Directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations. 

Company law requires the Directors to prepare financial statements for each financial year.  Under that law they have elected to prepare the financial statements in accordance with UK-adopted international accounting standards and applicable law. 

Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of its profit or loss for that period.  In preparing the financial statements, the Directors are required to:

●	select suitable accounting policies and then apply them consistently;
●	make judgements and estimates that are reasonable, relevant and reliable;
●	state whether they have been prepared in accordance with UK-adopted international accounting standards;
●	state whether they have been prepared in accordance with UK-adopted international accounting standards;
●	assess the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and
●	use the going concern basis of accounting unless they either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that its financial statements comply with the Companies Act 2006.  They are responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Company and to prevent and detect fraud and other irregularities. 

Under applicable law and regulations, the Directors are also responsible for preparing a Strategic Report and a Directors' Report that complies with that law and those regulations. 

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website.  Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. 

Responsibility statement of the directors in respect of the annual financial report

The directors of Rothschild & Co Continuation Finance PLC, whose names are set out on page 5, confirm that to the best of their knowledge;

●	The financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the company taken as a whole; and
●	The strategic report includes a fair review of the development and performance of the business and the position of the company taken as a whole, together with a description of the principal risks and uncertainties that it faces.

Independent Auditor's Report to the Members of Rothschild & Co Continuation Finance PLC

Opinion

We have audited the financial statements of Rothschild & Co Continuation Finance PLC (the 'Company') for the year ended 31 December 2024 which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Changes in Equity, the Cash Flow Statement and notes to the financial statements, including material accounting policy information.

The financial reporting framework that has been applied in their preparation is applicable law and UK-adopted international accounting standards.

In our opinion, the financial statements:

●	give a true and fair view of the state of the Company's affairs as at 31 December 2024 and of its loss for the year then ended;
●	have been properly prepared in accordance with UK-adopted international accounting standards; and
●	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the "Auditor's responsibilities for the audit of the financial statements" section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Our audit procedures to evaluate the directors' assessment of the Company's ability to continue to adopt the going concern basis of accounting included but were not limited to:

●	Undertaking an initial assessment at the planning stage of the audit to identify events or conditions that may cast significant doubt on the Company's ability to continue as a going concern;
●	Making enquiries of the management and assessing the management's going concern assessment and challenging the appropriateness of the assumptions used including the directors' consideration of severe but plausible scenarios; and
●	Evaluating the appropriateness of the directors' disclosures in the financial statements on going concern.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

We summarise below the key audit matters in forming our opinion above, together with an overview of the principal audit procedures performed to address each matter and our key observations arising from those procedures.

These matters, together with our findings, were communicated to those charged with governance through our Audit Completion Report.

Key Audit Matter

How our scope addressed this matter

Valuation of subordinated guaranteed notes and loan to immediate parent undertaking. Refer to page 21 for the key accounting policy Subordinated Guaranteed Notes (£96.31 million; 31 December 2023: £89.08 million)- refer to Note 12. Loan to immediate parent undertaking (£96.5 million; 31 December 2023: £89.28 million)- refer to Note 6. Risk The amount of the intercompany loan receivable and subordinated guaranteed notes represent 99% (December 2023: 99%) of the Company's total assets and total liabilities respectively. The fair value of the loan to immediate parent undertaking and subordinated guaranteed notes are based on an observable source of market data. As a result, the valuation does not represent a significant audit risk as there is no significant judgement or estimation uncertainty involved. Due to the quantum of these balances, this is considered to be a key audit matter as this is the area where the greatest audit effort is spent.

Our audit procedures included, but were not limited to: Subordinated guaranteed notes: ·      Performed a walkthrough of the valuation process; ·      Obtained the issuance documents to confirm the underlying details of subordinated guaranteed notes; ·      Determined the fair value of subordinated guaranteed notes using an independent and reliable pricing source; ·      Reviewed the adequacy of the disclosure in the financial statements. Loan to immediate parent undertaking: ·      Obtained the loan agreement to confirm the loan terms. ·      Agreed the principal (GBP) value to the immediate parent undertaking's accounting records; ·      Determined the fair value of the loan using the tested price for subordinated guaranteed notes; ·      Assessed the recoverability of the loan to the immediate parent undertaking. Our observations Based on the work performed and evidence obtained, we consider the valuation of subordinated guaranteed notes and loan to immediate parent undertaking to be appropriate.

Our application of materiality and an overview of the scope of our audit

The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect of misstatements, both individually and on the financial statements as a whole. Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Overall materiality	£974,492
How we determined it	The overall Company statutory materiality has been calculated with reference to the Company's total assets, of which it represents approximately 1%.
Rationale for benchmark applied	Total assets have been identified as the principal benchmark within the financial statements as it is considered to be the focus of the shareholders. 1% reflects the borrow-to-lend nature of the Company as changes in loan terms or interest rates can impact financial performance and shareholder value.
Performance materiality	Performance materiality is set to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements in the financial statements exceeds materiality for the financial statements as a whole. We set performance materiality at £584,695, which represents 60% of overall materiality.
Reporting threshold	We agreed with the directors that we would report to them misstatements identified during our audit above £29,235 as well as misstatements below that amount that, in our view, warranted reporting for qualitative reasons.

As part of designing our audit, we assessed the risk of material misstatement in the financial statements, whether due to fraud or error, and then designed and performed audit procedures responsive to those risks. In particular, we looked at where the directors made subjective judgements, such as assumptions on significant accounting estimates.

We tailored the scope of our audit to ensure that we performed sufficient work to be able to give an opinion on the financial statements as a whole. We used the outputs of our risk assessment, our understanding of the Company, its environment, controls, and critical business processes, to consider qualitative factors to ensure that we obtained sufficient coverage across all financial statement line items.

Other information

The other information comprises the information included in the Annual Report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

●	the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
●	the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

●	adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been received from branches not visited by us; or
●	the Company financial statements are not in agreement with the accounting records and returns; or
●	certain disclosures of directors' remuneration specified by law are not made; or
●	we have not received all the information and explanations we require for our audit.

Responsibilities of Directors

As explained more fully in the directors' responsibilities statement set out on page 5, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.

Based on our understanding of the Company and its industry, we considered that non-compliance with the following laws and regulations might have a material effect on the financial statements: bribery act, money laundering regulations and certain aspects of Company legislation recognising the financial and regulated nature of the Company's activities.

To help us identify instances of non-compliance with these laws and regulations, and in identifying and assessing the risks of material misstatement in respect to non-compliance, our procedures included, but were not limited to:

●	Gaining an understanding of the legal and regulatory framework applicable to the Company and the industry in which it operates, and considering the risk of acts by the Company which were contrary to the applicable laws and regulations, including fraud;
●	Inquiring of the directors, management and, where appropriate, those charged with governance, as to whether the Company is in compliance with laws and regulations, and discussing their policies and procedures regarding compliance with laws and regulations;
●	Inspecting correspondence with relevant licensing or regulatory authorities
●	Reviewing minutes of directors' meetings in the year; and
●	Discussing amongst the engagement team the laws and regulations listed above, and remaining alert to any indications of non-compliance.

We also considered those laws and regulations that have a direct effect on the preparation of the financial statements, such as tax legislation, the Companies Act 2006.

In addition, we evaluated the directors' and management's incentives and opportunities for fraudulent manipulation of the financial statements, including the risk of management override of controls, and determined that the principal risks related to posting manual journal entries to manipulate financial performance and significant one-off or unusual transactions.

Our procedures in relation to fraud included but were not limited to:

●	Making enquiries of the directors and management on whether they had knowledge of any actual, suspected or alleged fraud;
●	Gaining an understanding of the internal controls established to mitigate risks related to fraud;
●	Discussing amongst the engagement team the risks of fraud;
●	Addressing the risks of fraud through management override of controls by performing journal entry testing.

The primary responsibility for the prevention and detection of irregularities, including fraud, rests with both those charged with governance and management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls.

The risks of material misstatement that had the greatest effect on our audit are discussed in the "Key audit matters" section of this report.

A further description of our responsibilities is available on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Other matters which we are required to address

Following the recommendation of the board of directors, we were appointed by the board of directors on 18 July 2024, to audit the financial statements for the year ending 31 December 2024 and subsequent financial periods. The period of total uninterrupted engagement is 1 year, covering the year ending 31 December 2024.

The non-audit services prohibited by the FRC's Ethical Standard were not provided to the Company and we remain independent of the Company in conducting our audit.

Our audit opinion is consistent with our additional report to the Board of Directors.

Use of the audit report

This report is made solely to the Company's members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members as a body for our audit work, for this report, or for the opinions we have formed.

As required by the Financial Conduct Authority Disclosure Guidance and Transparency Rules, these financial statements will form part of the electronic reporting format prepared annual financial report filed on the National Storage Mechanism of the Financial Conduct Authority. This auditor's report provides no assurance over whether the annual financial report has been prepared using the correct electronic format.

Kamilla Racinska (Senior Statutory Auditor)

for and on behalf of Forvis Mazars LLP

Chartered Accountants and Statutory Auditor

30 Old Bailey

London

EC4M 7AU

24 April 2025

Statement of Comprehensive Income

For the year ended 31 December 2024

		2024	2023
	Note	£	£
Interest income		4,264,569	4,290,569
Interest expense		(4,264,119)	(4,276,750)
Net interest income		450	13,819
Gain/(Loss) on revaluation of loan to immediate parent	6	7,220,920	(3,571,708)
(Loss)/Gain on revaluation of debt securities in issue	12	(7,229,939)	3,567,238
Foreign exchange translation losses		(87)	(7,551)
(Loss)/Profit before tax		(8,656)	1,798
Tax Credit / (charge)	5	1,495	(8,352)
Loss for the financial year		(7,161)	(6,554)
Other comprehensive income		-	-
Total comprehensive loss for the financial year		(7,161)	(6,554)

All amounts are in respect of continuing activities. 

The notes on pages 18 to 26 form an integral part of these financial statements

Balance Sheet

At 31 December 2024

			2024		2024	2023	2023
	Note		£		£	£	£
Non-current assets
Loan to immediate parent		6			96,498,120		89,277,200
Current assets
Other financial assets		7	679,153			713,960
Amounts due from group companies		9	16,887			-
Current tax asset			1,733			-
Cash and cash equivalents		8	250,385			268,360
			948,158			982,320
Current liabilities
Current tax liability			-			(1,904)
Other financial liabilities		11	(677,222)			(712,007)
Net current assets					270,936		268,409
Total assets less current liabilities					96,769,056		89,545,609
Non-current liabilities
Deferred tax liability		10			(46,513)		(45,844)
Subordinated Guaranteed Notes		12			(96,312,068)		(89,082,129)
Net assets					410,475		417,636
Shareholders' equity
Share capital		14			100,000		100,000
Retained earnings					310,475		317,636
Total shareholders' equity					410,475		417,636

Approved by the Board of Directors and signed on its behalf on 24 April 2025 by:

Peter Barbour, Director

The notes on pages 18 to 26 form an integral part of these financial statements

Statement of Changes in Equity

For the year ended 31 December 2024

	Share Capital	Retained Earnings	Total Equity
	£	£	£
At 31 December 2023	100,000	317,636	417,636
Total comprehensive loss for the financial year	-	(7,161)	(7,161)
At 31 December 2024	100,000	310,475	410,475
At 31 December 2022	100,000	324,190	424,190
Total comprehensive loss for the financial year	-	(6,554)	(6,554)
At 31 December 2023	100,000	317,636	417,636

The notes on pages 18 to 26 form an integral part of these financial statements

Cash Flow Statement

For the year ended 31 December 2024

		2024	2023
	Note	£	£
Cash flow from operating activities Net (loss) for the financial year		(7,161)	(6,554)
Tax (credit) / charge	5	(1,495)	8,352
Operating (loss)/profit before changes in working capital and provisions		(8,656)	1,798
Fair value movements of loans	6	(7,220,920)	3,571,708
Fair value movements of debt securities	12	7,229,939	(3,567,238)
Cash from operations		363	6,268
Taxation paid		(1,473)	(3,009)
Net decrease/(increase) in other financial assets		34,807	(91,391)
Net (decrease)/increase in other financial liabilities		(34,785)	91,435
Net increase in amounts due from group companies		(16,887)	-
Net cash from operating activities		(17,975)	3,303
Net (decrease)/increase in cash and cash equivalents		(17,975)	3,303
Cash and cash equivalents at beginning of year		268,360	265,057
Cash and cash equivalents at end of year	8	250,385	268,360

Interest receipts and payments during the year were as follows:

		2024	2023
		£	£
Interest received from immediate parent		4,299,376	4,199,178
Interest paid to note holders		4,298,904	4,185,315

The notes on pages 18 to 26 form an integral part of these financial statements

Notes to the Financial Statements

(forming part of the Financial Statements)

For the year ended 31 December 2024

1.    Accounting Policies

Rothschild & Co Continuation Finance PLC ("the Company") is a public limited company incorporated in England and Wales, and whose registered office is at New Court, St Swithin's Lane, London EC4N 8AL.  The Company operates in one segment, debt trading. Revenue from these debt instruments constitutes most of the Company's income. During the reporting period, all interest income earned, aside from minor bank account interest generated from Rothschild & Co Bank International, is from the immediate parent, NMR, and is attributed to the Company's country of domicile, the United Kingdom. The principal accounting policies which have been consistently adopted in the presentation of the financial statements are as follows:

a.       Basis of preparation

The financial statements are prepared and approved by the Directors in accordance with international accounting standards as adopted in the UK, in conformity with the requirements of the Companies Act 2006.

Functional and presentation currency

These financial statements are presented in sterling, which is the Company's functional currency.

Going concern

Management has performed an assessment to determine whether there are any material uncertainties that could cast significant doubt on the ability of the Company to continue as a going concern. No significant issues have been noted. In reaching this conclusion, management considered:

-

The financial impact of any uncertainty on the Company's balance sheet;

-

The Company's liquidity position based on current and projected cash resources. The liquidity position has been assessed taking into account the forecast liquidity of N. M. Rothschild & Sons Limited ("NMR") and its ability to continue to pay the interest on the intercompany loan provided by the Company. This included severe but plausible downside scenarios for NMR as part of their assessment including scenarios with a significant reduction in revenues;

Based on the above assessment of the Company's financial position, the Directors have concluded that the Company has adequate resources to continue in operational existence for the foreseeable future (for a period of at least twelve months after the date that the financial statements are signed). Accordingly, they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

Standards affecting the financial statements

There were no new standards or amendments to standards that have been applied in the financial statements for the year ended 31 December 2024.

New standards, amendments and interpretations not yet adopted

The following new standards and amendments to standards and interpretations are effective for future periods:

●	IFRS 18 Presentation and Disclosure in Financial Statements (effective for periods beginning on or after 1 January 2027)
●	Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7) (effective for periods beginning on or after 1 January 2026).
●	Lack of Exchangeability (Amendments to IAS 21) (effective for periods beginning on or after 1 January 2025).

The Company does not intend to adopt the new or amended standards early. It is not currently expected that these new and amended standards will have a material impact on the Company's financial statements, although IFRS 18 will change the structure of the Income Statement. IFRS 18 requires endorsement by the UK Endorsement Board before it can be adopted by the Company.

b.       Interest income and expense

Interest income and expense represents interest arising out of lending and borrowing activities. Interest income and expense is recognised in the income statement.

c.       Foreign currencies

Transactions in foreign currencies are accounted for at the exchange rates prevailing at the time of the transaction.  Gains and losses resulting from the settlement of such transactions, and from the translation at period end exchange rates of monetary items that are denominated in foreign currencies, are recognised in the statement of comprehensive income. 

d.       Cash and cash equivalents

Cash for the purposes of the statement of cash flows, comprises money deposited with financial institutions that can be withdrawn without notice.

e.       Taxation

Tax payable on profits is recognised in the statement of comprehensive income.

Deferred tax is provided in full, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts. Deferred tax is determined using tax rates and laws that are expected to apply when a deferred tax asset is realised, or when a deferred tax liability is settled.

The Company is relying on the exemption from disclosing deferred tax assets and liabilities related to Pillar Two income taxes.

f.       Capital management

The Company is not subject to any externally imposed capital requirements.

g.       Financial assets and liabilities

Financial assets and liabilities are recognised on trade date and derecognised on either trade date, or on maturity, repayment, or when liabilities are extinguished. 

i.   Loans and advances

Loans and advances are non-equity financial assets with fixed and determinable payments that do not meet the solely payments of principal and interest (SPPI) requirements due to the two terms in the loan documentation that introduced exposure to non-basic risks:

-	There is dividend pusher clause which means that, in certain circumstances, the interest is not contractually payable and, if this happens, interest does not compound on any unpaid amount; and
-	The interest rate is reset quarterly but by reference to an index rate (EUR-TEC10-CNO) that is based on 10 year borrowing rates, which is viewed similar to a constant maturity swap.

These have been classified at Fair Value Through Profit or Loss (FVTPL). The fair values are based on the market value of the external debt securities.

ii.      Financial liabilities

Subordinated Guaranteed Notes in issue are recorded at fair value with any changes in fair value recognised in the income statement, per Note 12. All other financial liabilities are recognised at amortised cost. 

h.         Accounting judgements and estimates

In the application of the Company's accounting policies, which are described in note 1, the Directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. There are no critical judgements or estimates to disclose at the year end.

1.    Financial Risk Management

The Company follows the financial risk management policies of the immediate parent, N M Rothschild & Sons Limited.  The key risks arising from the Company's activities involving financial instruments, which are monitored at the group level, are as follows:

-          Credit risk - the risk of loss arising from client or counterparty default is not considered a material risk to the Company as all asset balances are with other group companies as detailed in note 14 Related Party Transactions. 

-          Market risk - exposure to changes in market variables such as interest rates, currency exchange rates, equity and debt prices is not considered material as the terms of financial assets substantially match those of financial liabilities. At the group level, limits on market risk exposure are set by the R&Co Group Assets and Liabilities Committee and are independently monitored.

-          Liquidity risk - the risk that the Company is unable to meet its obligations as they fall due or that it is unable to fund its commitments is not considered material as the risk has been transferred to NMR. As the funds on-lent to NMR have the same maturity dates as the notes issued, the Company's ability to meet its obligations in respect of notes issued by it is affected by NMR's ability to make payments to the Company. Liquidity risk disclosures are detailed in note 13 Maturity of Financial Liabilities. NMR, the immediate parent, regularly monitors its liquidity position and forecasts cash flows to ensure it can meet its financial obligations as they fall due.

Additionally, The R&Co Group Assets and Liabilities Committee is responsible for monitoring and managing all balance sheet, market and liquidity risks within the Group. Changes in market interest rates, currency exchange rates, and debt prices can affect the fair value of the loan, leading to revaluation gains or losses depending on their movement. The Company mitigates these risks by ensuring that the terms of financial assets substantially match those of financial liabilities, and by setting and monitoring limits on market risk exposure through the R&Co Group Assets and Liabilities Committee.

2.    Audit Fee

The amount receivable by the auditors and their associates in respect of the audit of these financial statements is £30,000 (2023: £25,000).  The audit fee is paid on a group basis by N M Rothschild & Sons Limited.

3.    Directors' Emoluments

None of the Directors received any remuneration from the Company or any other entity of the Rothschild & Co Group for their services during the year (2023: £nil).

4.    Taxation

	2024		2023
		£	£
Current tax		(2,164)	423
Deferred tax		669	7,929
Total tax		(1,495)	8,352

The tax charge can be explained as follows:		2024	2023
	Note	£	£
Profit/(Loss) before tax		(8,656)	1,798
United Kingdom corporation tax calculated at standard rate of 25% (2023: 25%)		(2,164)	450
Changes in tax rate		-	(27)
Deferred tax charge		669	7,929
Total tax		(1,495)	8,352

The UK corporation tax rate at the balance sheet date was 25 per cent.

5.    Loan to Immediate Parent

	2024	2023
	£	£
At beginning of period	89,277,200	92,848,908
Fair value movements	7,220,920	(3,571,708)
At end of period	96,498,120	89,277,200
Due In 5 years or more	96,498,120	89,277,200

In accordance with the business model assessment under IFRS 9, the loan to immediate parent is a non-equity financial asset that does not meet SPPI requirements and has been classified at Fair Value Through Profit or Loss (FVTPL). The fair value of the €150,000,000 loan as at 31 December 2024 was £96,498,120 (2023: £89,277,200).  On an amortised cost basis, the value of the loan at 31 December 2024 would be £124,033,572 (2023: £130,046,904).  The fair values are based on the market value of the external debt securities (level 2). 

Consistent with the prior period, the fair value was derived from quoted market prices at the balance sheet date. In accordance with IFRS 13 and due to a reduction in the frequency and volume of transactions observed in the immediate run up to the period end, the fair value is considered to be level 2 as at 31 December 2024 (2023: level 2).

The interest rate charged on the €150 million loan is EUR-TEC10-CNO plus 36 basis points, capped at 9.01 per cent, fixed on 05 February, 05 May, 05 August and 05 November each year. The maturity matches that of the subordinated guaranteed notes.

The interest rate on the above loan at 31 December 2024 was 3.52% (2023: 3.66%).  

6.    Current Assets: Other Financial Assets

	2024	2023
	£	£
Amounts owed by immediate parent: Interest receivable	679,153	713,960

Accrued interest on the loan is excluded from the fair value in Note 6 and is presented above.

7.    Cash and Cash Equivalents

	2024	2023
	£	£
Cash held at a fellow subsidiary Bank	250,385	268,360

At the year end the company held cash of £250,385 at a fellow subsidiary. £268,360 was held at the immediate parent in the prior year.

8.    Amounts due from group companies

	2024	2023
	£	£
Amounts due from immediate parent - N. M. Rothschild & Sons Limited	16,887	-

Amounts due from the immediate parent are interest free and repayable on demand.

9.    Deferred Income Taxes

	2024	2023
	£	£
At beginning of period	(45,844)	(37,915)
Recognised in income
Tax charge	(669)	(7,929)
At end of period	(46,513)	(45,844)

Deferred tax assets less liabilities are attributable to the following items:

	2024	2023
	£	£
Fair value of intra group loans	6,883,863	9,580,879
Fair value of subordinated guaranteed notes in issue	(6,930,376)	(9,626,723)
	(46,513)	(45,844)

Both the intra-group loans and subordinated guaranteed notes in issue are taxed on an amortised cost basis of accounting and accordingly taxable/deductible temporary differences arise following the adoption of IFRS 9.  Deferred tax is provided using rates that have been substantively enacted at the balance sheet date and that are expected to apply when the temporary difference is realised. The current UK corporation tax rate is 25 per cent.

10.  Current Liabilities: Other Financial Liabilities

	2024	2023
	£	£
Interest payable	677,222	712,007

Accrued interest on the Subordinated Guaranteed Notes are excluded from the fair value in Note 12 and is presented above.

11.  Subordinated Guaranteed Notes

	2024	2023
	£	£
At beginning of period	89,082,129	92,649,367
Fair value movements	7,229,939	(3,567,238)
At end of period	96,312,068	89,082,129
Repayable In 5 years or more	96,312,068	89,082,129

The Company has elected to fair value through P&L the subordinated guaranteed notes, which as at 31 December 2024 was £96,312,068 (2023: £89,082,129), to significantly reduce the accounting mismatch from the corresponding loan to immediate parent which is classified as fair value through P&L.

The change in fair value attributable to credit risk that should be presented in Other Comprehensive Income is immaterial. On an amortised cost basis, the value of the subordinated guaranteed notes in issue at 31 December 2024 would be £124,033,572 (2023: £130,046,904).

Consistent with the prior period, the fair value was derived from quoted market prices at the balance sheet date. In accordance with IFRS 13 and due to a reduction in the frequency and volume of transactions observed in the immediate run up to the period end, the fair value is considered to be level 2 as at 31 December 2024 (2023: level 2).

The interest rate payable on the €150 million Perpetual Subordinated Notes is EUR-TEC10-CNO plus 35 basis points, capped at 9 per cent, fixed on 05 February, 05 May, 05 August and 05 November each year.  From and including the interest payment date falling in August 2016 and every interest payment date thereafter, the Company may redeem all (but not some only) of the Perpetual Subordinated Notes at their principal amount. There is no plan to redeem the notes over the next 12 month period.

The interest rate on the above notes at 31 December 2024 was 3.51% (2023: 3.65%).

12.  Maturity of Financial Liabilities

The following table shows contractual cash flows payable by the Company on the perpetual subordinated notes, analysed by remaining contractual maturity at the balance sheet date.  Interest cashflows on perpetual subordinated notes are estimated and shown up to five years only, with the principal balance being shown in the perpetual column. Interest will still apply on the perpetual subordinated notes beyond the five year period.

		3 months
		or less	1 year	5 years
		but not	or less	or less
		payable	but over	but over
	Demand	on demand	3 months	1 year	Perpetual	Total
At 31st December 2024	£	£	£	£	£	£
Perpetual subordinated notes	-	1,088,395	3,265,184	17,414,313	124,033,572	145,801,464
		3 months
		or less	1 year	5 years
		but not	or less	or less
		payable	but over	but over
	Demand	on demand	3 months	1 year	Perpetual	Total
At 31st December 2023	£	£	£	£	£	£
Perpetual subordinated notes	-	1,186,678	3,560,034	18,986,848	130,046,904	153,780,464

13.  Share Capital

	2024	2023
	£	£
Authorised, allotted, called up and fully paid 100,000 Ordinary shares of £1 each	100,000	100,000

14.  Related Party Transactions

Parties are considered to be related if one party controls, is controlled by or has the ability to exercise significant influence over the other party.  This includes key management personnel, the parent company, subsidiaries and fellow subsidiaries. 

Amounts receivable from related parties at the year-end were as follows:

	2024	2023
	£	£
Cash and cash equivalents - Rothschild & Co Bank International	250,385	-
Amounts due from immediate parent - N. M. Rothschild & Sons Limited	16,887	-
Cash and cash equivalents at immediate parent  - N. M. Rothschild & Sons Limited	-	268,360
Accrued interest receivable from immediate parent	679,153	713,960
Loans to immediate parent - at fair value	96,498,120	89,277,200

Amounts recognised in the statement of comprehensive income in respect of related party transactions were as follows:

	2024	2023
	£	£
Interest income from immediate parent	4,264,569	4,290,569

There were no loans made to Directors during the year (2023: none) and no balances outstanding at the year-end (2023: £nil).  The Directors did not receive any remuneration in respect of their services to the Company.  There were no employees of the Company during the year (2023: none). 

15.  Immediate Parent, Ultimate Holding Company and Registered Office

The largest group in which the results of the Company are consolidated is that headed by Rothschild & Co Concordia SAS, incorporated in France, and whose registered office is at 23bis, Avenue de Messine, 75008 Paris. Rothschild & Co Concordia SAS is the ultimate controlling party. The smallest group in which they are consolidated is that headed by Rothschild & Co SCA, a private partnership whose registered office is also at 23bis, Avenue de Messine, 75008 Paris.  The accounts are available on Rothschild & Co website at https://www.rothschildandco.com/en/about-us/results-reports/.

The Company's immediate parent company is N. M. Rothschild & Sons Limited, incorporated in England and Wales and whose registered office is at New Court, St Swithin's Lane, London EC4N 8AL. 

The Company's registered office is located at New Court, St Swithin's Lane, London EC4N 8AL. 

16.  Subsequent Events

The Company has evaluated subsequent events and determined that there have been no events that have occurred that would require adjustments to our disclosures in the financial statements.

 

END