FY 2024/25 Consolidated Financial Statements

Audit Report on

Consolidated Financial Statements

issued by an Independent Auditor

AEDAS HOMES, S.A. AND

SUBSIDIARIES

Consolidated Financial Statements and Consolidated Manaqement Report

for the year ended

March 31, 2025

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Ernst & Young, S.L.

C/ Raimundo Fernandez Villaverde, 65 28003 Madrid

Tel: 902 365 456

Fax: 915 727 238

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AUDIT REPORT ON CONSOLIDATED FINANCIAL STATEMENTS ISSUED BY AN INDEPENDENT AUDITOR

Translation of a report and financial statements originally issued in Spanish. In the event of discrepancy, the Spanishlanguage version prevails

To the shareholders of AEDAS HOMES, S.A.:

Audit report on the consolidated financial statements

Opinion

We have audited the consolidated financia I statements of AEDAS HOMES, S.A. (the parent) and its subsidiaries (the Group), which comprise the consolidated balance sheet at March 31, 2025, the consolidated income statement, the consolidated statement of comprehensive income, the consolidated statement of changes in equity, the consolidated statement of cash flows, and the notes thereto, for the year then ended.

In our opinion, the accompanyinq consolidated financial statements qive a true and fair view, in all material respects, of consolidated equity and the consolidated financial position of the Group at March 31, 2025 and of its financial performance and its consolidated cash flows, for the year then ended in accordance with International Financial Reportinq Standards, as adopted by the European Union (IFRS-EU), and other provisions in the requ!atory framework applicable in Spain.

Basis for opinion

We conducted our audit in accordance with prevailinq audit requlations in Spain. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the consolidated financial statements section of our report.

We are independent of the Group in accordance with the ethical requirements, including those related to independence, that are relevant to our audit of the consolidated financial statements in Spain as required by prevailing audit regulations. In this regard, we have not provided non-audit services nor have any situations or circumstances arisen that might have compromised our mandatory independence in a manner prohibited by the aforementioned requirements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

DomicilioSoca:CaledeRamundo FerndndezVillaverde,65.2B003Madrid-lnscritaenelRegistroMercantildeMadrid.tomo9.364genera,8.l3Odelasección3°delLibrodeSociedades,

folio 68, hoja n° 87.690-1, inscripción 1°. C.I.F. B-78970506.

A member firm o f Ernst & Young Global Limited.

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Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our audit opinion thereon, and we do not provide a separate opinion on these matters.

Measurement of inventories

Description

Our

response

At March 31, 2025, the Group carried inventories at 1,478,823 thousand euros, which mainly comprise land and sites, as well as various developments in proqress and completed buildinqs that are beinq held for the purpose of sellinq the homes beinq built. The disclosures pertaininq to these assets can be found in note 11 to the accompanyinq consolidated financial statements. As detailed in note 4.4, the Group's inventories are measured at their acquisition cost, qrossed up primarily by the cost of any development works, related purchase costs, construction cost, and capitalized borrowinq costs, or their estimated market value, if lower.

At each reporting date, the parent's directors test these inventories for indications of impairment. Impairment losses are recognized when their carrying amount exceeds their recoverable amount. To determine the inventories recoverable amount, the parent's directors rely primarily on the appraisals provided by an independent expert in keeping with the valuation standards prescribed by the Royal Institution of Chartered Surveyors (RICS).

The risk of the incorrect initial recognition of these assets, the incorrect capitalization of eligible costs and the possible impairment of these assets, as well as the

materiality of the amounts involved, have led us to conclude that the measurement of the Group's inventories constitutes the key audit matter.

In this regard, our audit procedures included the following, among others:

Understandinq Group manaqement s processes to determine the inventories recoverable amount the inventory, includinq evaluation of the desiqn and implementation of the relevant controls.

Reviewinq the purchase deeds for real estate assets and analyzinq a sample of costs capitalized as an increase in inventories.

Reviewinq, in collaboration with our valuation experts, the valuation methodoloqy used by the independent expert for a sample of the properties appraised by the latter, which encompassed a mathematical assessment of the model, an analysis of the projected cash flows, and a review of the discount rates used.

Reviewinq the disclosures included in the notes to the accompanyinq consolidated financial statements in conformity with the applicable requlatory financial reporting framework.

Other information: consolidated management report

Other information refers exclusively to the 2025 consolidated manaqement report, the preparation of which is the responsibility of the parent company's directors and is not an integral part of the consolidated financial statements.

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Our audit opinion on the consolidated financial statements does not cover the consolidated manaqement report. Our responsibility for the consolidated manaqement report, in conformity with prevailinq audit requlations in Spain, entails:

1. Checkinq only that the non-financial statement certain information included in the Corporate Governance Report and the Annual Report on the Remunerations of Directors, to which the Audit Law refers, was provided as stipulated by applicable requlations and, if not, disclose this fact.

2. Assessing and reporting on the consistency of the remaining information included in the consolidated management report with the consolidated financial statements, based on the knowledge of the Group obtained during the audit, in addition to evaluating and reporting on whether the content and presentation of this part of the consolidated management report are in conformity with applicable regulations. If, based on the work we have performed, we conclude that there are material misstatements, we are required to disclose this fact.

Based on the work performed, as described above, we have verified that the information referred to in paragraph a) above is provided as stipulated by applicable regulations and that the remaining information contained in the conso! idated management report is consistent with that provided in the 2025 consolidated financial statements and its content and presentation are in conformity with applicable regulations.

Responsibilities of the parent company"s directors and the audit and control committee for the consolidated financial statements

The directors of the parent company are responsible for the preparation of the accompanying consolidated financial statements so that they give a true and fair view of the equity, financial position and results of the Group, in accordance with IFRS-EU, and other provisions in the regulatory framework applicable to the Group in Spain, and for such internal control as they determine is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparinq the consolidated financial statements, the directors of the parent company are responsible for assessinq the Group's ability to continue as a qoinq concern, disclosinq, as applicable, matters related to qoinq concern and usinq the qoinq concern basis of accountinq unless the directors either intend to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

The audit and control committee is responsible for overseeing the Group's financial reporting process.

Auditor's responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated 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 prevailing audit regulations in Spain 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 cou!d reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

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As part of an audit in accordance with prevailinq audit regulations in Spain, we exercise professional judgement and maintain professional skepticism throuqhout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, desiqn and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detectinq a material misstatement resulting from fraud is hiqher than for one resultinq from error, as fraud may involve collusion, forqery, intentional omissions, misrepresentations, or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.

Evaluate the appropriateness of accounting policies used and the reasonableness of accountinq estimates and related disclosures made by management.

Conclude on the appropriateness of the directors' use of the qoing concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast siqnificant doubt on the Group's ability to continue as a qoinq concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a qoinq concern.

Evaluate the overall presentation, structure and content of the consolidated financial statements, includinq the disclosures, and whether the consolidated financial statements represent the underlyinq transactions and events in a manner that achieves fair presentation.

Plan and perform the Group audit to obtain sufficient appropriate audit evidence reqardinq the financial information of the entities or business units within the Group as a basis for forminq an opinion on the consolidated financial statements. We are responsible for the direction, supervision and review of the audit work performed for the purposes of the Group audit. We remain solely responsible for our audit opinion.

We communicate with the audit and control committee of the parent company reqardinq, amonq othermatters,the panned scopeandtiming oftheaudit andsignhicantaudit flndings,incudingany significant deficiencies in internal control that we identify durinq our audit.

We also provide the audit and control committee of the parent company with a statement that we have complied with relevant ethical requirements reqardinq independence, and to communicate with them all matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threads or safequards applied.

From the matters communicated with the audit and control committee, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters.

We describe these matters in our auditor's report unless law or requlation precludes public disclosure about the matter.

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Report on other leqal and requlatory requirements

European sinqle electronic format

We have examined the diqital files of the European sinqle electronic format (ESEF) of AEDAS HOMES,

S.A. and subsidiaries for the 2025 financial year, which include the XHTML file containinq the consolidated financial statements for the year, and the XBRL files as labeled by the entity, which will form part of the annual financial report.

The directors of AEDAS HOMES S.A. are responsible for submitting the annual financial report for the 2025 financial year, in accordance with the formattinq and mark-up requirements set out in Deleqated Requlation EU 2019/815 of 17 December 2018 of the European Commission (hereinafter referred to as the ESEF Requlation). In this reqard, the Corporate Governance Annual Report and the Board remuneration report have been incorporated by reference in the inteqrated annual report.

Our responsibility consists of examining the digital files prepared by the directors of the parent company, in accordance with prevailing audit regulations in Spain. These standards require that we plan and perform our audit procedures to obtain reasonable assurance about whether the contents of the consolidated financial statements included in the aforementioned digital files correspond in their entirety to those of the consolidated financial statements that we have audited, and whether the consolidated financial statements and the aforementioned files have been formatted and marked up, in all material respects, in accordance with the ESEF Regulation.

In our opinion, the diqital files examined correspond in their entirety to the audited consolidated financial statements, which are presented and have been marked up, in all material respects, in accordance with the ESEF Regulation.

Additional report to the audit and control committee

The opinion expressed in this audit report is consistent with the additional report we issued to the

audit and control committee on May 28, 2025.

Term of enqaqement

The ordinary genera I shareholders' meeting held on July 20, 2023 appointed us as Group s auditors for 3 years, commencing on March 31, 2024.

Previously, we were appointed as auditors by the shareholders for 3 years and we have been carryinq

out the audit of the consolidated financial statements continuously since December 31, 2016.

ERNST & YOUNG, S.L.

(Registered in the Official Register of Auditors under No. S0530)

(Signed on the original version In Spanish)

Fernando Gonzalez Cuervo (Reqistered in the Official Reqister of Auditors under No. 21268)

May 28, 2025

Consolidated financial statements for the year ended 31 March 2025 prepared under the International Financial Reporting Standards adopted by the European Union (IFRS-EU), Consolidated Management Report

(Thousands of euros)

The accompanying notes 1 to 24 are an integral part of the consolidated balance sheet as at 31 March 2025

1

CONSOLIDATED NET INCOME STATEMENT

FOR THE YEARS ENDED 31 MARCH 2025 AND 31 MARCH 2024

(Thousands of euros)

The accompanying notes 1 to 24 are an integral part of the consolidated net income statement for the year ended 31 March 2025

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEARS ENDED 31 MARCH 2025 AND 31 MARCH 2024

(Thousands of euros)

The accompanying notes 1 to 24 are an integral part of the consolidated statement of comprehensive income for the year ended 31 March 2025

AEDAS HOMES, S.A. and Subsidiaries

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEARS ENDED 31 MARCH 2025 AND 31 MARCH 2024

(Thousands of euros)

The accompanying notes 1 to 24 are an integral part of the consolidated statement of changes in equity for the year ended 31 March 2025

4

AEDAS HOMES, S.A. and Subsidiaries

CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEARS ENDED 31 MARCH 2025 AND 31 MARCH 2024

(Thousands of euros)

The accompanying notes 1 to 24 are an integral part of the consolidated statement of cash flows for the year ended 31 March 2025

(*) The change in working capital attributable to land purchases/sales during the period does not include the gross profit from land sales

5

Notes to the consolidated financial statements for the year ended 31 March 2025

1. The Aedas Homes Group's business

   The Group comprises Aedas Homes, S.A. (hereinafter, the Parent or the Company) and its subsidiaries (Appendix I).

   The Parent's registered office is located in Madrid, Spain, at Paseo de la Castellana, 130. It is registered with the Madrid Companies Register.

   In its capacity as the Group Parent, the corporate purpose of Aedas Homes, S.A. is to acquire, permit, manage, market and develop properties of any kind for holding, use, management, sale or lease.

   The foregoing activities may be performed in whole or in part on an indirect basis through ownership interests in other companies with similar corporate purposes. To that end, the Parent may acquire, administer and sell securities of all kinds, including but not limited to, shares, convertible bonds and unitholdings of any kind. Appendix I of these notes itemises the activities performed by Aedas Homes, S.A.'s investees.

   The Group operates in Spain; however, since 24 September 2024, it has been providing real estate development management services to VEL VINT-I-U, S.L., an entity located in Andorra.

   The Parent was incorporated under the name of SPV Spain 19, S.L.U. as a result of the subscription and payment of 3,000 indivisible equity interests (participaciones sociales), numbered sequentially, with a unit par value of 1 euro. They were paid for in cash. Hipoteca 43 Lux, S.À.R.L. purchased 100% of those interests on 5 July 2016. The Parent's name was changed to Aedas Homes Group, S.L.U. on 18 July 2016. It assumed its current name in the wake of the restructuring transaction outlined in note 1.a.

   On 12 September 2017, the Company's legal form of incorporation was changed to that of a public limited company (sociedad anónima) so that it took the name of Aedas Homes, S.A. (Sociedad Unipersonal).

   The shares representing the share capital of Aedas Homes S.A. have been trading on the continuous stock markets of Madrid, Barcelona, Bilbao and Valencia since 20 October 2017.

   The deeds declaring the loss of sole-shareholder status (sociedad unipersonal) were placed on public record on 23 November 2017.

   On 30 March 2020, the Parent's shareholders resolved, in general meeting and on the basis of a report from the Board of Directors, to change the Company's fiscal year to the 12 months elapsing between 1 April and 31 March of the following year, with the exception of the first fiscal year following the change, which ran from 1 January 2020 until 31 March 2020.

2. Basis of presentation of the consolidated financial statements

   1. Basis of preparation

      The consolidated financial statements of the Group comprising Aedas Homes, S.A. and its subsidiaries for the year ended 31 March 2025 were prepared from the accounting records of the Parent and the other companies comprising the Group (refer to Appendix I) in keeping with the International Financial Reporting Standards adopted by the European Union (IFRS-EU).

      The consolidated financial statements were prepared under the IFRS-EU in effect on the date of their issuance. They take into consideration all of the accounting principles and standards and measurement criteria that are mandatorily applicable under IFRS-EU such that they present fairly, in all material respects, the Group's equity and financial position as at 31 March 2025 and its financial performance and the changes in its equity and cash flows, all on a consolidated basis, for the year then ended.

      However, given that the accounting principles and measurement criteria used to prepare the Group's consolidated financial statements for the year ended 31 March 2025 may differ from those used by certain of the Group entities, the appropriate adjustments and reclassifications have been made upon consolidation in order to ensure the application of uniform principles and criteria and to align them with IFRS-EU.

      In order to present the different items that make up the consolidated financial statements on a uniform basis, the accounting policies and measurement standards used by the Parent have been applied to all of the companies consolidated.

      The Group uses certain alternative performance measures (APMs) that are not defined in IFRS-EU as those additional measures contain essential information for assessing the Group's performance.

      In the consolidated net income statement, the APMs used are Gross Profit, Gross Margin, Net Margin, EBITDA and Adjusted EBITDA, and they are defined as follows:

      • Gross Profit represents the difference between revenue from sales and the provision of services and the direct costs associated with those sales and services. This APM provides a clear picture of the Group's basic profitability before considering other function-specific expenses. The items comprising Gross Profit are described in notes 19.1 and 19.2 of these consolidated financial statements.

        The Gross Margin is calculated by dividing Gross Profit by Revenue.

      • The Net Margin is arrived at by deducting from Gross Profit other costs directly related with the Group's business activities, including:

        • Sales and marketing expenses.

        • Costs associated with the developments.

        • Taxes related with the developments.

          This APM represents profitability net of all of direct revenue-generating expenses.

          The percentage Net Margin is calculated by dividing the absolute Net Margin by revenue from sales and services.

      • EBITDA reflects the Group's profit-generating capacity before considering interest, tax, depreciation, amortisation or impairment. It is calculated by deducting the following key items from the Net Margin:

        • General expenses.

        • Other operating income.

        • Other operating expenses.

          The EBITDA Margin is calculated by dividing EBITDA by revenue.

      • Funds from Operations (FFO) is calculated by adding to EBITDA:

        • Other adjustments to profit derived mainly from provisions, the Group's share of associates' earnings and changes in non-current assets and liabilities.

        • Other cash flows from operating activities derived from interest, dividends and tax.

          FFO is widely used in the real estate sector as it serves as a proxy for recurring cash flows before capital expenditure.

      • Operating Cash Flow is arrived at by adding to FFO the movements in working capital as per the consolidated statement of cash flows, excluding cash flows related with buyers assuming their share of developer loans.

      • Lastly, Free Cash Flow (FCF) is calculated by deducting from Operating Cash Flow the investments in intangible assets and property, plant and equipment (i.e., capital expenditure, or Capex) included within cash flows used in investing activities. This APM provides a clear picture of the cash generated after covering the business' basic operating and investment needs.

   2. Adoption of the International Financial Reporting Standards

      The consolidated financial statements were prepared in accordance with the International Financial Reporting Standards (IFRS) adopted by the European Union (IFRS-EU), in conformity with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council, that were effective as at 31 March 2025.

      The consolidated financial statements were prepared on a historical cost basis, with the exception of certain assets and financial instruments which have been measured at their revalued amounts or fair values at year-end, as explained in the accounting policies and measurement rules section provided further below. As a general rule, historical cost values are based on the fair value of the consideration provided in exchange for goods and services.

      The figures shown in the documents comprising these consolidated financial statements (consolidated balance sheet ('consolidated financial position statement'), consolidated net income statement, consolidated statement of comprehensive income, consolidated statement of changes in equity, consolidated statement of cash flows and these notes) are mainly expressed in thousands of euros. However, for practical reasons, in order to simplify certain disclosures, some of the figures provided in these notes are expressed in millions of euros, or, in the case of earnings per share, euros.

      New and amended IFRS and interpretations

      The accounting standards used to prepare the consolidated financial statements for the year ended 31 March 2025 are the same as those used to prepare the consolidated financial statements for the year ended 31 March 2024, except for the following standard amendments published by the IASB and adopted by the European Union for use in the European Union, which were applied for the first time in the year that began on 1 April 2024.

      Amendments to IAS 21 - Lack of Exchangeability

      IAS 21 has been amended to specify how to assess whether a currency is exchangeable into another currency at a measurement date and for a specified purpose and clarify how to determine a spot exchange rate when exchangeability is lacking.

      The amendments aim to improve transparency and the fair presentation of an entity's financial position in hyperinflationary economies.

      Given the scope of the Group's activities, these amendments have not had and are not expected to have any impact whatsoever on the Group's annual consolidated financial statements.

      Amendments to IAS 1 - Classifying Liabilities as Current or Non-Current

      These amendments clarify that debt and other liabilities with an uncertain settlement date should be classified in the consolidated balance sheet as current or non-current depending on an entity's existing rights at the end of the reporting period. They also address the classification requirements for debt that might be settled by converting it into equity.

      The amendments clarify, but do not modify, the existing requirements and only affect the presentation of liabilities on the consolidated balance sheet, not the amount or timing of the recognition of assets, liabilities, income or expenses or the information to be disclosed about these items.

      Application of these amendments in the current year has not had a significant impact on these annual consolidated financial statements.

      Amendments to IAS 1 - Non-Current Liabilities with Covenants

      The aim of these amendments is to improve disclosures about non-current debt with covenants so as to help investors understand the risk that such debt could become repayable within 12 months from the reporting date.

      IAS 1 only allows the classification of debt as non-current if the entity can avoid settling the debt within 12 months after the reporting date. However, its ability to do so is often subject to compliance with certain covenants.

      These amendments clarify that covenants that must be complied with after the reporting date do not affect the classification of the debt as current or non-current at the reporting date. However, the reporting entity must disclose information about any such covenants in its consolidated financial statement notes.

      Application of these amendments in the current year has not had a significant impact on these annual consolidated financial statements.

      Amendments to IFRS 16 - Lease Liability in a Sale and Leaseback

      These narrow-scope amendments provide specific guidelines for a seller-lessee so as to measure the lease liability arising from a leaseback transaction so that it does not give rise to the recognition of the gain or loss related with the right of use it retains.

      Application of these amendments in the current year has not had a significant impact on these annual consolidated financial statements.

      Amendments to IAS 7 and IFRS 7 - Supplier Finance Agreements

      These amendments clarify the characteristics of supplier finance agreements and introduce new disclosure requirements around those agreements with the aim of providing investors with information that helps them understand their effects on the entity's liabilities, cash flows and exposure to liquidity risk.

      By way of transition relief, in this first year of application, entities are exempt from disclosing opening balances and presenting comparative information.

      Application of these amendments in the current year has not had a significant impact on these annual consolidated financial statements.

      Standard amendments not effective as at 31 March 2025

      At the date of authorising the these annual consolidated financial statements for issue, the following standards and amendments had been published by the IASB but their application was not yet mandatory:

      Standards and amendments

      Mandatory application: in annual periods beginning on or after

      Amendments to IFRS 9 and IFRS 7	Amendments to the Classification and Measurement of Financial Instruments	1 January 2026
      Amendments to IFRS 9 and IFRS 7	Contracts Referencing Nature-dependent Electricity	1 January 2026
      Annual Improvements to IFRS Accounting Standards - Volume 11		1 January 2026
      IFRS 18	Presentation and Disclosure in Financial Statements	1 January 2027
      IFRS 19	Subsidiaries without Public Accountability: Disclosures	1 January 2027

      The Group is currently analysing what impact these new pronouncements will have on its annual consolidated financial statements, if applicable, when they are applied for the first time.

      IFRS 18 will supersede IAS - Presentation of Financial Statements and introduces new presentation requirements that will affect the consolidated net income statement, including new totals and subtotals. In addition, all income and expenses in the consolidated net income statement will have to be classified into five categories: operating, investing, financing, income tax and discontinued operations.

      All entities will be affected by these new requirements. IFRS 18, along with its derivative amendments, becomes effective for annual reporting periods starting on or after 1 January 2027, and requires retrospective application.

      The Group is currently working to identify what impact these new criteria will have on its annual consolidated financial statements and the accompanying notes. Its preliminary analysis suggests that IFRS 18 will primarily affect the presentation of certain items in the consolidated net income statement but will not modify their recognition or measurement.

   3. Functional and presentation currency

      The consolidated financial statements for the year ended 31 March 2025 are presented in euros, which is the Group's functional and presentation currency. They are presented in thousands of euros other than certain specific figures provided in the notes, which, for practical reasons, are presented in millions of euros or just euros for simplification and/or clarification purposes. The financial statements for the year ended 31 March 2024 were authorised and presented in euros.

   4. Responsibility for the information presented and estimates made

      The Group Parent's directors are responsible for the information included in these consolidated financial statements.

      The Group's consolidated financial statements for the year ended 31 March 2025 make occasional use of estimates made by the management of the Group and of its consolidated companies, later ratified by their respective directors, in order to quantify certain of the assets, liabilities, income, expenses and obligations recognised therein. These estimates relate basically to the following:

      • The estimation of the net realisable value of the Group's "real estate inventories" (also referred to as "inventories" and/or "real estate assets": at year-end, the Group measured the net realisable value of its inventories, understood as their estimated sale price less all of the estimated costs necessary to complete their construction. Their fair value was determined on the basis of appraisals performed by independent experts. Savills Valoraciones y Tasaciones, S.A.U. appraised the Group's real estate asset portfolio as at 31 March 2025 (without considering prepayments to suppliers). The real estate inventories were appraised using the 'market value' assumption, in keeping with the Valuation - Professional Standards and Guidance notes published by Great Britain's Royal Institution of Chartered Surveyors (RICS) (note 11).

      • The probability of obtaining future taxable income when recognising deferred tax assets (note 4.10).

        Although these estimates were made on the basis of the best information available at 31 March 2025 regarding the facts analysed, future events could make it necessary to revise these estimates (upwards or downwards) in coming years. Changes in accounting estimates would be applied prospectively in accordance with IAS 8, recognising the effects of the change in estimates in the related consolidated net income statement.

   5. Basis of consolidation

      In order to present the financial information on a uniform and comparable basis, the accounting policies and measurement rules used by the Parent have been applied to all of the companies consolidated.

      The universe of companies included in the consolidation scope in the reporting periods ended 31 March 2025 and 31 March 2024 is itemised in the accompanying Appendix I.

      Subsidiaries

      Subsidiaries are investees over which the Parent exercises control either directly or indirectly via other subsidiaries. The Parent controls a subsidiary when it is exposed, or has rights, to variable returns from its involvement with it and has the ability to affect those returns through its power over the investee. The Parent is deemed to have power over an investee when it has existing rights that give it the current ability to direct its relevant activities. The Parent is exposed, or has rights, to variable returns from its involvement with the investee when the returns obtained from its involvement have the potential to vary as a result of the entity's performance.

      The Parent re-evaluates whether it controls an investee when events and circumstances indicate the existence of changes in one or more of the control elements itemised above. The Parent consolidates a subsidiary from when it obtains control (and deconsolidates it when it ceases to have such control).

      The interests of minority shareholders (hereinafter, "non-controlling interests") are measured at their percentage interest in the fair values of the identifiable assets and liabilities recognised. Accordingly, any loss attributable to non-controlling interests in excess of the carrying amount of such interests is recognised with a charge against the Parent's equity. Non-controlling interests in:

      1. The equity of the Group's investees: are presented under "Non-controlling interests" in the consolidated balance sheet within Group equity.

      2. Profit or loss for the period: are presented under "Profit/(loss) for the period attributable to non-controlling interests" in the consolidated net income statement.

      The income and expenses of subsidiaries acquired or disposed of during the year are included in the consolidated net income statement from the acquisition date or until the date of change in control, as warranted.

      Material intra-group balances and transactions among fully-consolidated investees are eliminated upon consolidation, as are the gains or losses included in the inventories deriving from purchases from other Group companies.

      All of the assets, liabilities, equity, income, expenses and cash flows related with transactions among the Group companies are fully eliminated upon consolidation.

      Investments in associates and joint ventures

      An investment in an associate or a joint venture is measured using the equity method of accounting whereby they are initially recognised at cost, and the carrying amount of the investment is increased or decreased to recognise the Group's share of the profit or loss of the investee after the date of acquisition. The Group recognises its share of such investees' profit or loss within its profit or loss for the period. Distributions received from these investees reduce the carrying amount of the investment. Adjustments to the carrying amount may also be necessary for changes in the Group's proportionate interest in the investee arising from changes in the investee's other comprehensive income (e.g. to account for changes arising from revaluations of property, plant and equipment). The Group recognises its share of any such changes in other comprehensive income.

      The Parent has notified all the companies in which it has ownership interests of 10% or more, directly or indirectly through subsidiaries, of this fact, in keeping with article 155 of Spain's Corporate Enterprises Act.

      Reporting date uniformity adjustments

      All of the Group companies share the same reporting date, i.e., 31 March, except for Fiji Investments Holding, S.À.R.L, Aedas KS Atalanta, S.L.U, Aedas KS El Verger, S.L.U, Aedas KS Finley, S.L.U, Aedas KS Llunare, S.L.U, Aedas KS Rocabella, S.L.U, Aedas KS Silgar, S.L.U, Aedas KS Volanta, S.L.U, Global Disosto, S.L.U, Global Encono, S.L.U, Global Quitina, S.LU., S.L.U Espacio Son Puig, S.L, Partida De La Rápita, S.L, Torres y Santa Marta, S.L, Espacio Promoción IV, S.L, Espacio Promoción VII, S.L, Espacio Áurea, Nueva Marina Real Estate, S.L, Espacio Promoción VIII, S.L., Java Investments Holding, S.À.R.L, Aedas KS Fonsalía S.L.U., Aedas KS Santa Clara S.L.U., Aedas KS Levante, S.L.U., Aedas KS Iberia, S.L.U., Servicios Inmobiliarios Residencial en Venta JV2, S.L.U., BTS Servicios Inmobiliarios JV1, S.L., Varía ACR Móstoles Fuensanta, S.L., Espacio Áurea, S.L., Allegra Nature, S.L., Residencial Henao, S.L., Áurea Etxabakoitz, S.L., Residencial Ciudadela Uno, S.L., Nature Este, S.L. and Domus Avenida, S.L., whose reporting date coincides with the calendar year, i.e., 31 December. This circumstance does not have a significant impact on these annual consolidated financial statements.

      More specifically, the financial statements of the companies whose reporting date is different from that of the Parent (i.e., different from 31 March) are consolidated by making uniformity adjustments to include transactions related to the same date and periods as the consolidated financial statements since, in keeping with IFRS 10, the Group is not obliged to issue interim financial statements for those investees as of the same date and periods, since the difference between those companies' and the Group's reporting dates is not more than three months. There were no significant transactions or events at those companies between the two reporting dates.

   6. Business combinations and goodwill

      Goodwill and bargain purchase gains

      The assets, liabilities and contingent liabilities of a newly acquired subsidiary are stated at their acquisition-date fair values. Any excess of the cost of acquisition over the fair values of the identifiable net assets acquired is recognised as goodwill. If the cost of an acquisition is less than the fair value of the identifiable net assets acquired (i.e., a bargain purchase), the gain is recognised in profit and loss in the period of the acquisition (under "Gain on a bargain purchase").

      Priesa Group business combination

      In August 2024, the Company acquired 100% of Promociones y Propiedades Inmobiliarias Espacio,

      S.L.U. ("Priesa"), the parent of a group of companies ("Priesa Group") whose core business is the development of residential real estate assets in Spain.

      The transaction was framed by the Group's strategy of reinforcing its geographic footprint, accelerating its growth and expanding its land bank. The acquisition gave it control over Priesa and its subsidiaries and associates, as defined in IFRS 10, so that those investees have been consolidated since the acquisition date using the full consolidation or equity method, as appropriate.

      Companies acquired

      Fully consolidated

      The Group has fully consolidated the following companies: Espacio Abstract, S.L.U., Espacio Alicante, S.L.U., Espacio Mallaeta, S.L.U., Espacio Cosmo, S.L.U., Espacio Project Management, S.L.U., Espacio Valdebebas 175, S.L., Espacio Singulart Almería, S.L.U., Heco Homes Gredos, S.L.U., Espacio Promoción X, S.L.U., Espacio Proyectos SPV II, S.L.U., Espacio Desarrollos Urbanos, S.L.U., Espacio Ciresa, S.L.U., Espacio Insigne, S.L.U. and Espacio Promoción XI, S.L.

      Equity method

      The Group has consolidated the following investees using the equity method of consolidation: Espacio Son Puig, S.L. (30%), Partida de la Rápita, S.L. (33%), Torres y Santa Marta, S.L. (50%), Espacio Promoción IV, S.L. (10%), Espacio Promoción VII, S.L. (50%), Espacio Áurea, S.L. (50%), Marina de Fuengirola Siglo XXI, S.L. (33%) (this investee was sold to third parties on 4 October 2024), Nueva Marina Real Estate, S.L. (20%) and Espacio Promoción VIII, S.L. (30%).

      On 21 November 2024, and with effect for accounting purposes since 1 September 2024, the Parent, which is the entity that acquired the Priesa Group for legal purposes, agreed to merge the Priesa Group companies in which the Group held 100% shareholdings since the Priesa Group acquisition, namely Espacio Abstract, S.L.U, Espacio Alicante, S.L.U., Espacio Mallaeta, S.L.U., Espacio Cosmo, S.L.U., Espacio Proyect Management. S.L.U., Espacio Valdebebas 175, S.L., Espacio Singulart Almería, S.L.U., Heco Homes Gredos, S.L.U., Espacio Promoción X, S.L.U., Espacio Desarrollos Urbanos, S.L.U., Espacio Ciresa, S.L.U., Espacio Insigne, S.L.U. and Espacio Promoción XI, S.L. (100%), into the Parent's subsidiary, Aedas Homes Opco, S.L.U. ("successor").

      Price of the business combination

      The total cost of the business combination, before adjustments, was 35,572 thousand euros, broken down between:

      • Payment of cash: 20,759 thousand euros.

      • Deferred (long-term) payment: 14,813 thousand euros.

      The liability derived from the deferred consideration has been recognised within "Non-current liabilities

      - Other financial liabilities" (note 15). The balance pending payment to Grupo Villar Mir, S.A. at 31 March 2025 amounted to 7,889 thousand euros.

      In keeping with the analysis carried out by the Parent's management and considering the price adjustment clauses in the share purchase agreement, the acquisition price was subsequently reduced by 525 thousand euros, so that the business combination cost considered for the purpose of calculating the goodwill or bargain purchase gain was 35,047 thousand euros.

      Provisional allocation of the purchase price

      As required under IFRS 3 - Business combinations, the price of the business combination has been provisionally allocated on the basis of the estimated fair values of the identified assets acquired and liabilities assumed on the acquisition date. The allocation may be adjusted during the 12-month measurement period from the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date.

      	Thousands of euros
      Property, plant, and equipment (note 8)	5
      Intangible assets (note 7)	30
      Investment properties (note 9)	11,557
      Non-current financial assets (note 10)	6,686
      Deferred tax assets (note 17)	58,151
      Real Estate inventories (note 11)	33,157
      Trade receivables	4,439
      Other receivables	336
      Cash and cash equivalents	4,728
      Other current assets	138
      Non-current borrowings (note 15)	(8,695)
      Deferred tax liabilities (note 17)	(483)
      Current borrowings	(30,940)
      Trade payables	(18,868)
      Other current liabilities	(3,135)
      Fair value of the net assets acquired at the investees accounted for using the full consolidation method	57,106
      Fair value of the investees accounted for using the equity method of consolidation (Note 9)	30,025
      TOTAL FAIR VALUE OF THE NET ASSETS ACQUIRED	87,131
      Cost of the net assets acquired	(35,047)
      GAIN ON A BARGAIN PURCHASE	52,084

      The gain on a bargain purchase has been recognised in the consolidated net income statement for the year ended 31 March 2025 in keeping with IFRS 3 - Business Combinations. This gain reflects an acquisition price of less than the fair value of the identified net assets and is attributable to the financial situation of the Priesa Group's former sole shareholder, Grupo Villar Mir, S.A., whose investing and financing constraints were affecting the viability of the assets acquired.

      Analysis of cash flows on acquisition:

      	Thousands of euros
      Cash consideration paid on the acquisition date Less: Net cash acquired	(20,759) 4,728
      Net cash outflow	(16,030)

      Each note of these consolidated financial statements provides details, where significant, of the main assets and liabilities contributed by the Priesa Group companies acquired.

      Note that when provisionally measuring the above business combination, the Group considered the potential tax effect derived from the acquisition of the Priesa Group, specifically the deferred tax assets derived, primarily, from the acquiree's unused tax losses and unused tax credits as of the acquisition date (note 4.10) whose utilisation is deemed high probable, factoring in the taxable income of the Aedas Homes Tax Group for this year and the coming years.

      The revenue and earnings contributed by this business combination, measured provisionally, between the acquisition date and 31 March 2025:

      	Thousands of euros
      Revenue	2
      Profit/(loss) for the period	(2,054)

      Note, lastly, that because the majority of Priesa Group entities were merged into Aedas Homes Opco,

      S.L.U. shortly after their acquisition, the revenue and earnings contribution would not have been substantially different to that shown above if Priesa had been part of the Group since 1 April 2024.

      Other business combinations during the reporting period

      In July 2024, the Group closed and accounted for the acquisition of the following entities: Altacus Investments, S.A., Cirilla Investments, S.A., Lysistrata Investments, S.A. Since these investees were acquired for a sum equivalent to their net assets, these business combinations did not give rise to any goodwill.

      Also in July 2024, the Parent entered into binding agreements with a vehicle managed by Banco Santander for the development and operation of shared living complexes ("Flex Living") in Valencia and Madrid, through two joint ventures in which it holds non-controlling interests through:

      • Servicios Inmobiliarios Residencial en Venta JV 2, S.L.U. (10% interest).

      • Flexliving Valdemarín, S.L. (10% interest).

   7. Comparison of information

      Comparative information for the year ended 31 March 2024 is presented alongside the information for the year ended 31 March 2025 in respect of the consolidated balance sheet, consolidated net income statement, consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows.

3. Appropriation of profit of the Parent:

   The proposal for the appropriation of profit for the year ended 31 March 2025 will be approved by the Board of Directors of the Parent at the same meeting at which it authorises the issue of these annual consolidated financial statements and will be disclosed in note 24, "Events after the reporting period", as prescribed in the Corporate Enterprises Act and in keeping with the Group's disclosure requirements under the applicable financial reporting framework.

4. Material accounting standards

   The following accounting principles, policies and measurement criteria were used to prepare the Group's consolidated financial statements for the year ended 31 March 2025:

   1. Intangible assets

      Intangible assets are identifiable non-monetary assets, without physical substance, which arise as a result of a legal transaction or are developed by the consolidated companies. The Group only recognises assets whose cost can be estimated reasonably objectively and from which the consolidated companies expect to obtain future economic benefits.

      Intangible assets are initially recognised at acquisition or production cost and subsequently measured at cost less accumulated amortisation and any impairment losses.

      1. Software

         The Group recognises software at the amount of costs incurred to acquire and develop it; these costs include website development costs. Software licensing and maintenance costs, usually annual, are recognised in the consolidated net income statement in the year incurred and/or for which they are valid. Software is amortised using the straight-line method over a three-year period.

      2. Trademarks

      This account recognises the costs incurred to acquire trademarks that have not been generated internally. Their estimated useful life is, in general, indefinite.

   2. Property plant and equipment and right-of-use assets

      Property, plant and equipment

      The items comprising property, plant and equipment are measured initially at acquisition or production cost and are subsequently carried net of accumulated depreciation and any impairment losses.

      Acquisition or production cost for items of property, plant and equipment that require more than one year to ready for use (qualifying assets) include borrowing costs accrued prior to getting the assets ready for use when those expenses have been invoiced by the supplier or correspond to specific or generic loans or other external financing directly allocable to the acquisition or construction of the asset.

      The costs of maintaining and repairing the various items of property, plant and equipment are charged to the consolidated net income statement in the year incurred. On the other hand, amounts spent to upgrade these assets that increase their productivity, capacity or efficiency or lengthen their useful lives are capitalised.

      Interest and other financial charges incurred during the construction of property, plant and equipment are recognised, in general, as an increase in the cost of the construction in progress.

      The work that the Group performs on its own assets is recognised at cost, which is external costs plus internal costs, determined on the basis of in-house consumption of warehouse materials, direct labour costs incurred and general construction costs (overhead) allocated based on throughput rates similar to those used to value inventories.

      Depreciation is calculated, using the straight-line method, on the basis of the acquisition cost of the assets less their residual value; the land on which the buildings and other structures stand has an indefinite life and, therefore, is not depreciated.

      The annual depreciation charges are made with a balancing entry in the consolidated net income statement as a function of the assets' estimated useful lives. The average estimated useful lives of the items comprising property, plant and equipment are shown below:

      	Annual depreciation rate
      Straight-line depreciation schedule:
      Other plant	20%
      Furniture & fittings	10%
      Computer hardware	25%
      Other items of PP&E	20%

      Assets under construction earmarked for production or for administrative or commercial use, are recognised at cost, less any impairment losses. Cost includes professional fees. Depreciation of these assets commences when the assets are ready for their intended use.

      Impairment of intangible assets and property, plant and equipment

      At each reporting date, the Parent checks the carrying amounts of its property, plant and equipment and intangible assets for indications of impairment. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). If the asset does not generate cash flows that are independent from those of other assets, the Parent estimates the recoverable amount of the cash-generating unit (CGU) to which the asset belongs.

      The recoverable amount is the higher of fair value less costs to sell and value in use. To estimate value in use, the Group discounts the asset's estimated future cash flows to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset in question for which the estimated future cash flows have not been adjusted.

      If the estimated recoverable amount of an asset (or CGU) is lower than its carrying amount, the carrying amount of that asset (or CGU) is written down to its recoverable amount. The impairment loss is expensed in profit and loss immediately.

      When an impairment loss subsequently reverts, the carrying amount of the asset (or CGU) is written up to its newly estimated recoverable amount, so long as the restated carrying amount does not exceed the carrying amount that would have been recognised had no impairment loss been recognised for the asset (or CGU) in prior years. The impairment loss is reversed in profit and loss immediately.

      Right-of-use assets

      As prescribed in IFRS 16 - Leases, the Group recognises a right-of-use asset and a lease liability at the inception of all contracts that are or contain a lease, applying the exemptions provided for short-term and low-value leases.

      At the commencement date, right-of-use assets are recognised at cost, which includes:

      • The amount of the initial measurement of the lease liability.

      • Any lease payments made at or before the commencement date, less any lease incentives received.

      • Any initial direct costs.

      • An estimate of costs to be incurred by the lessee in dismantling, removing or restoring the underlying asset.

      Subsequently, the right-of-use asset is measured at cost less any accumulated depreciation and any accumulated impairment losses (depreciating the assets on a straight-line basis over the shorter of the lease term and the useful life of the underlying asset).

      The lease liability is measured at the commencement date at the present value of the lease payments that are not paid at that date, discounted using the interest rate implicit in the lease, or, if that rate cannot be readily determined, at the lessee's incremental borrowing rate. The lease liability is subsequently measured at amortised cost using the effective interest method, remeasuring the carrying amount to reflect any reassessment of the lease term, lease modifications or changes in future lease payments.

   3. Investment property

      In lease agreements with an option to purchase the property in which the Group acts as lessor and considers it has not transferred substantially all the risks and rewards incidental to ownership of the leased properties, the Group recognises the assets as investment properties, which it depreciates over their useful lives (50 years, or 2% per annum), recognising the rental income as it accrues. If the purchase option is exercised, the Group reclassifies the property to inventories at its carrying amount, recognising a gain or loss on the sale at the difference between the purchase option exercise price (net of the premium and the percentage of rent paid as stipulated in the lease) and the carrying amount of the property.

   4. Inventories

      This consolidated balance sheet heading includes the assets that the consolidated companies:

      1. Hold for sale in the ordinary course of their businesses.

      2. Have in the process of production, construction or development to this end.

      3. Expect to consume in the production and/or construction process or in the provision of services.

      The Parent's directors believe that the Group's inventories do not qualify as investment properties under IAS 40. As a result, the land and other properties it holds for sale are considered real estate inventories once they are integrated into a real estate development.

      Land and sites are measured at the lower of (i) acquisition cost plus any planning costs, costs specific to the acquisition (stamp duty, registration fees, etc.) and the borrowing costs incurred during execution of the planning work; or (ii) estimated market value.

      Construction in progress refers to costs incurred in property developments, or sections thereof, whose construction is not complete at the reporting date. These costs include, in general, those corresponding to the site, planning, construction work, capitalised borrowing costs incurred from the start of the technical and administrative work required prior to commencing construction and during the construction period itself, and other direct costs and indirect costs that can be allocated to the developments.

      The Group companies transfer the costs accumulated under "Construction in progress" to "Finished properties" when construction of its developments or sections thereof is complete.

      Sales costs, other than sales commissions conditional upon the sale going through, are expensed currently.

      Costs accumulated for developments for which the forecast construction termination date is within 12 months of the reporting date are classified as "Short-cycle developments in progress".

      The Group reviews its inventories for indications of impairment periodically, recognising the required impairment provisions as warranted in keeping with the criteria outlined below. The cost of its land and sites, developments in progress and completed developments is reduced to fair value by recognising the appropriate impairment provisions. If the fair value of the Group's inventories is above cost, however, the cost/contribution amounts are left unchanged.

      The fair value of the Group's inventories is estimated based on appraisals performed by independent experts not related to the Group (Savills Valoraciones y Tasaciones, S.A.). Those appraisals calculate fair value primarily using the dynamic residual method for land and the discounted cash flow method for developments in progress and finished developments, in keeping with the Valuation and Appraisal Standards published by the Royal Institution of Chartered Surveyors (RICS) of Great Britain, and the International Valuation Standards (IVS) published by the International Valuation Standards Committee (IVSC).

      To calculate fair value, the Group uses the dynamic residual method and the discounted cash flow method for inventories of land and developments in progress/finished developments, respectively, as indicated above. This methodology consists of estimating the value of the land/developments in progress/finished developments by means of the comparative or discounted cash flow method which is then reduced by the development costs still to be incurred for each property, depending on its stage of completion (such costs therefore include any planning costs, construction costs, fees, duties, sales costs, etc.), and the development margin in order to estimate the residual value. The sources of income and costs are spread out in time to reflect the development milestones and sales estimated by the appraiser. The discount rate used is that representing the average annual return on the development, adjusted for the property's intrinsic characteristics and risks, without factoring in external borrowings, that a developer would obtain on a development of similar characteristics to that being analysed. The discount rate is arrived at by adding the risk-free rate and the risk premium (determined by assessing the development's risk in light of the nature of the property to be developed or under development, its location, liquidity, execution timeline and the investment required).

      Given the uncertainty intrinsic in any forward-looking information, actual results may differ from the projections used to estimate the recoverable amount of the Company's inventories, which could make it necessary to change these estimates (upwards or downwards) in future years; as disclosed in note 2.4 above, any such changes would be applied prospectively, as prescribed in IAS 8.

      As disclosed in note 2.4, the Group's assets (except for those covered by a pre-sale agreement and prepayments to suppliers) have been valued by an independent expert and that expert's appraisal values were used as inputs in testing its inventories for impairment.

      Those appraisals took the form of individual asset-by-asset assessments, factoring in the building standards planned for each, which in turn determine the associated construction costs and sales price ranges. An individual assessment was also made of the average length of time expected to be needed to obtain the various planning permits and requirements and the average length of time needed to build each development as a function of its nature and density.

      4.5. Trade receivables

      Trade receivables do not accrue interest and are recognised at their face value less impairment allowances, if any.

      To calculate impairment on its trade receivables as at 31 March 2025, the Group used the simplified approach prescribed in IFRS 9 - Financial Instruments (lifetime expected credit losses or ECL). However, the Group has not recognised any impairment allowances against its trade receivables in its annual consolidated financial statements, due mainly to the fact that the agreements it enters into with its customers can be terminated if they breach their payment terms.

      4.6. Customer prepayments

      The amounts received from customers as down payments for land and/or buildings, whether in cash or trade bills, before the sale is recognised are recognised under "Customer prepayments" within current liabilities on the consolidated balance sheet.

      1. Financial instruments

         1. Financial assets

            Financial assets are initially recognised at fair value, plus or minus, in the case of financial assets not measured at fair value through profit or loss, the transaction costs directly attributable to their acquisition or issuance. Notwithstanding the foregoing, the Group measures its trade receivables at their transaction price if they do not contain a significant financing component.

            For subsequent measurement purposes, the financial assets held by the Group companies are mainly classified as financial assets at amortised cost, as they are held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

            Financial assets are derecognised by the various Group companies when the contractual rights to the cash flows from the financial asset expire or substantially all the risks and rewards of ownership of the financial asset are transferred.

            At each reporting date, the Parent's directors test the Group's financial assets for impairment, recognising impairment allowances for expected credit losses.

         2. Financial liabilities and equity

            An equity instrument is any contract that evidences a residual interest in the net assets of the Group.

            The Group companies' financial liabilities are mainly held-to-maturity financial liabilities, which are classified and subsequently measured as financial liabilities at amortised cost.

         3. Equity instruments

            The equity instruments issued by the Parent are recognised in equity at the amount received net of direct issuance costs.

         4. Bank loans

            Interest-bearing bank loans and overdrafts are recognised at the amount received, net of direct issuance costs. Finance costs, including premiums payable upon settlement or repayment and direct issuance costs, are recognised on an accrual basis in the consolidated net income statement using the effective interest method and are added to the carrying amount of the financial instrument to the extent that they are not settled in the year in which they accrue.

         5. Trade payables

         Trade payables do not accrue interest and are recognised at face value.

      2. Treasury shares

         Treasury shares acquired by the Company during the year are recognised at the amount of consideration given in exchange and are presented as a deduction from equity. The gains and losses resulting from the purchase, sale, issuance or cancellation of own equity instruments are recognised directly in equity and are not reclassified to profit or loss under any circumstances.

      3. Provisions and contingent liabilities

         In preparing the consolidated financial statements, the Parent's directors distinguish between:

         1. Provisions: liabilities recognised to cover a present obligation arising from past events, of uncertain timing and/or amount, settlement of which is expected to result in an outflow of resources embodying economic benefits.

         2. Contingent liabilities: a possible obligation that arises from past events whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the Group's control.

            The consolidated financial statements recognise all provisions in respect of which it is considered more likely than not that a present obligation exists.

            Contingent liabilities are not recognised in the consolidated balance sheet, but they are disclosed in the accompanying notes, unless the possibility of an outflow of resources embodying economic benefits is deemed remote, as required under IAS 37.

            Provisions (which are measured using the best information available regarding the outcome of the event giving rise to their recognition and re-estimated at each reporting date) are used to meet the specific obligations for which they were recognised originally, and are reversed, fully or partially, when the obligations no longer exist or decrease.

            The compensation to be received from a third party when an obligation is settled is recognised as a separate asset so long as it is virtually certain that the reimbursement will be received, unless the risk has been contractually externalised so that the Group is legally exempt from having to settle, in which case the reimbursement is taken into consideration in estimating the amount of the provision, if any.

            Provisions for the completion of works

            The Group recognises provisions for the completion of works when the construction work is complete at the amount of invoices pending receipt for the development in question, plus estimated after-sales costs, based on prior experience.

            There were no contingent liabilities, contingent assets or penalties for delays in delivering houses at either reporting date, other than as described in note 18 below.

      4. Income tax

         Consolidated income tax expense is recognised in the consolidated net income statement, except when it relates to transactions recognised directly in equity, in which case the related tax is likewise recognised in equity.

         Tax expense (tax income) comprises current tax expense (current tax income) and deferred tax expense (deferred tax income).

         Deferred tax assets and liabilities are those expected to be recoverable or payable on the differences between the carrying amounts of assets or liabilities in the consolidated financial statements and the tax bases used to calculate taxable income and are recognised using the liability method in the consolidated balance sheet. They are measured at the tax rates that are expected to apply when the asset is realised or the liability is settled.

         Deferred tax assets or liabilities are recognised for temporary differences originating from investments in subsidiaries and associates and interests in joint ventures unless the Group can control the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.

         However:

         1. Deferred tax assets are only recognised to the extent that it is probable that future taxable profit will be available against which the unused tax losses and unused tax credits can be utilised; and

         2. Under no circumstances are deferred taxes recognised in connection with goodwill arising in a business combination.

         Recognised deferred tax assets and liabilities are reassessed at each reporting date to check that they still qualify for recognition and the appropriate adjustments are made on the basis of the outcome of the analyses performed, factoring in any applicable quantitative and/or time limits.

         Note, lastly, that in 2017, the Board of Directors resolved to apply the tax consolidation regime (contemplated in article 55 et seq. of the Spanish Corporate Income Tax - Law 27/2014) from 2018 on. Subsequently, Hipoteca Finco Lux, S.à.r.l., an entity not resident in Spain, domiciled in Luxembourg, having become the parent of the tax group by virtue of having lifted its indirect ownership interest above 70%, designated Aedas Homes, S.A. as the representative of the Tax Group made up of the Tax Group parent (Hipoteca Finco Lux, S.à.r.l.) and its subsidiary, Aedas Homes, S.A., and, in turn, the subsidiaries of the latter: Aedas Homes Opco, S.L.U, Aedas Homes Living, S.L.U, Aedas Homes Canarias S.L.U, Aedas Homes Rental, S.L.U, Aedas Homes Servicios Inmobiliarios, S.L.U. and Live Virtual Tours, S.L.U.

      5. Income and expenses

         Revenue and expenses are recognised on an accrual basis, i.e., when earned or incurred, respectively, regardless of when actual collection or payment occurs. This income is measured at the fair value of the consideration received less discounts and taxes.

         To determine whether to recognise revenue, the Group follows the five-step process prescribed in IFRS 15 - Revenue from Contracts with Customers:

         1. Identifying the contract.

         2. Identifying the contract performance obligations.

         3. Determining the transaction price.

         4. Allocating the transaction price to each of performance obligations.

         5. Recognising revenue when the performance obligations are satisfied.

         Given that its contracts with its customers do not tend to vary significantly, as permitted in the applicable accounting standard, the Group accounts for them collectively.

         Specifically, the Group companies recognise property development sales and the related cost when the properties are handed over and title thereto has been transferred. For these purposes, the sale of a finished residential product is understood to have occurred when the keys are handed over, which coincides with the exchange of deeds. A sale is not deemed closed for revenue recognition purposes until this happens.

         Revenue does not include any discounts given, VAT or other taxes related with the sales. Expenses are recognised on an accrual basis, i.e., as incurred.

         Interest income is recognised using the effective interest method, by reference to the principal outstanding and the applicable effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset's carrying amount.

         Expenses are recognised in the consolidated net income statement when a decrease in future economic benefits related to a decrease in an asset or an increase in a liability has arisen that can be measured reliably. This involves recognising an expense at the same time as the increase in the value of the liability or reduction in the value of the asset.

         In addition, an expense is recognised immediately when an expenditure produces no future economic benefits or when future economic benefits do not qualify for recognition as an asset.

         An expense is also recognised when a liability is generated and no asset is recognised, as in the case of a liability for a guarantee.

         As a general rule, commissions paid to external agents that are not specifically allocable to the developments, albeit unquestionably related thereto, incurred between the start of the development work and recognition of the related sales as revenue are accrued under "Current prepayments and accrued income" on the asset side of the consolidated balance sheet and are expensed upon recognition of the revenue from homes delivered, so long as at each reporting date the margin deriving from the sales contracts entered into and pending recognition as revenue is higher than these expenses. If a given development does not present a positive margin, these expenses are reclassified to profit and loss.

         Sales costs, other than the above-mentioned sales commissions conditional upon the sale going through, are expensed currently.

      6. Borrowing costs

         Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets -assets that necessarily take a substantial period of time to get ready for their intended use or sale - are capitalised within the cost of those assets until they are substantially ready for their intended use or sale or their development is suspended. Interest income earned on the temporary investment of specific borrowings pending investment in qualifying assets is deducted from the borrowing costs eligible for capitalisation.

         In the case of funds obtained from generic loans, the amount of borrowing costs eligible for capitalisation is determined, in general, by applying a capitalisation rate to the sum invested in the asset in question. That capitalisation rate is the weighted average rate of interest borne on the loans received by the consolidated companies that were outstanding during the reporting period other than loans arranged specifically to finance certain assets. The amount of borrowing costs capitalised during the year did not exceed total interest expense incurred during the year.

      7. Operating profit

         Operating profit is presented before the Group's share of associates' earnings, income from financial investments and finance costs.

      8. Termination benefits

         Under prevailing labour law, the Group is obliged to pay severance to employees that are discontinued under certain circumstances. Termination benefits that can be reasonably estimated are registered as an expense in the year in which the redundancy decision is taken.

         No provision for termination benefits has been recognised in the accompanying consolidated financial statements as the Group is not currently contemplating any redundancies.

      9. Director and key management personnel remuneration

         The remuneration earned by the Parent's key management personnel ("KMP") (refer to note 21) is recognised on an accrual basis such that the Group recognises the corresponding provision at each reporting date in respect of any amounts that have not yet been paid.

         In the case of equity-settled share-based transactions (i.e., the Group's long-term investment plans, or LTIPs), both the services provided and the related increase in equity are measured at the fair value of the equity instruments granted with reference to the date of their grant. If, on the other hand, they are settled in cash, the goods and services received and the corresponding liability are recognised at the fair value of the latter, with reference to the date on which the vesting conditions are met.

      10. Environmental assets and liabilities

          Environmental assets are long-lived assets used in the ordinary course of the Group's business whose ultimate purpose is to minimise its environmental impact or improve its environmental record and include assets designed to reduce or eliminate future contamination.

          Given the activities in which the Group is involved, it has no environmental liabilities, expenses, assets, provisions or contingencies that could be material in respect of its equity, financial position or performance. Environmental disclosures are accordingly not provided in these consolidated financial statements.

      11. Related party transactions

          The Group carries out all transactions with related parties (whether financial, commercial or other in nature) at transfer prices that meet the OECD's rules governing transactions with group companies and other related parties. The Group has duly met its documentation requirements in respect of these transfer prices so that the Parent's directors believe there is no significant risk of related liabilities of material amount.

          In the event of a significant difference between the price so established and the fair value of a transaction between related parties, the difference would be considered a distribution of profits or contribution of funds between Group companies and as such would be recognised with a charge or credit to a reserves account, as warranted.

          The Group conducts all related-party transactions on an arm's length basis.

      12. Distinction between current and non-current

          The following assets are classified as current assets: those associated with the normal operating cycle (which is generally considered to be one year); other assets that are expected to mature, be sold or realised within 12 months of the reporting date; financial assets held for trading other than financial derivatives due for settlement more than 12 months from the reporting date; and cash and cash equivalents. Any assets that do not meet these criteria are classified as non-current assets.

          Likewise, the following liabilities are classified as current liabilities: those related with the normal operating cycle; financial liabilities held for trading other than financial derivatives due for settlement more than 12 months from the reporting date; and, in general, all liabilities that fall due or will be extinguished within 12 months of the reporting date. All other liabilities are presented as non-current.

          However, in the real estate sector, in which the normal operating cycle tends to be longer than 24-36 months, the line item, "Real estate inventories", which like other inventories are classified as current assets for accounting purposes, includes amounts whose completion, construction and delivery is expected to take place more than 12 months from the end of the reporting period. By the same token, the financial liabilities and/or trade payables, whether owed to third parties or related parties, that are associated directly or indirectly with these "Real estate inventories" are classified within current liabilities, even if they fall due more than 12 months from the reporting date. This accounting treatment maintains a balance between assets and liabilities associated with the same normal operating cycle, faithfully reflecting the working capital tied up with the real estate business's real operations.

      13. Business combinations

          Business combinations are accounted for using the acquisition method, which requires identification of the acquisition date, calculation of the cost of the combination and recognition of the identifiable assets acquired and liabilities assumed at their acquisition-date fair values.

          Goodwill, or a gain on a bargain purchase, is calculated as the difference between the fair values of the net assets acquired and the cost of the business combination, all as of the acquisition date.

          The cost of a business combination is the aggregate of:

          • The acquisition-date fair values of the assets acquired, the liabilities incurred or assumed and any equity instruments issued.

          • The fair value of any contingent consideration that depends on future events or delivery of predetermined conditions.

          The cost of a business combination does not include expenses related with the issuance of any equity instruments or financial liabilities delivered in exchange for the assets acquired.

          In the exceptional event of a gain on a bargain purchase, the gain is recognised in the consolidated net income statement.

          If at the end of the reporting period in which the business combination occurs it is not possible to complete the valuation work needed to apply the acquisition method outlined above, the business combination is accounted for provisionally. The provisional amounts recognised can be adjusted within a measurement period of no more than one year from the acquisition date to reflect access to new information. The effects of any such adjustments are accounted for retroactively, modifying the comparative information as necessary.

          Subsequent changes in the fair value of contingent consideration are recognised in profit or loss, unless the consideration has been classified in equity, in which case subsequent changes in its fair value are not recognised.

      14. Share-based payment transactions

          The Parent recognises, on the one hand, the goods and services received as an asset or expense, depending on their nature, at the time they are received and, the corresponding increase in equity, if the transaction is settled using equity instruments, or the corresponding liability, if it is settled in an amount that is based on the value of the equity instruments, on the other.

          In the case of equity-settled share-based transactions, both the services provided and the related increase in equity are measured at the fair value of the equity instruments granted with reference to the date of their grant. If, on the other hand, they are settled in cash, the goods and services received and the corresponding liability are recognised at the fair value of the latter, with reference to the date on which the vesting conditions are met.

      15. Leases

          The Group recognises in its consolidated balance sheet the assets and liabilities deriving from all of the lease agreements in which it acts as lessor (with the exception of short-term leases and leases of low-value assets) on the basis of contracts, or part of a contract, that convey the right to use an asset (the underlying asset) for a period of time in exchange for consideration, as prescribed in IFRS 16 - Leases.

          Right-of-use assets are depreciated on a straight-line basis over the shorter of their estimated useful lives and the lease term.

          The Group's lease agreements do not include dismantling or restoration obligations.

          Right-of-use assets are presented in a separate line item on the consolidated balance sheet.

      16. Segment reporting

          The Group has not defined any operating or geographical segments since its business consists almost exclusively of property development in Spain.

      17. Investments in associates

      An investment in an associate or a joint venture is measured using the equity method of accounting whereby they are initially recognised at cost, and the carrying amount of the investment is increased or decreased to recognise the Group's share of the profit or loss of the investee after the date of acquisition. The Group recognises its share of such investees' profit or loss within its profit or loss for the period. Distributions received from these investees reduce the carrying amount of the investment. Adjustments to the carrying amount may also be necessary for changes in the Group's proportionate interest in the investee arising from changes in the investee's other comprehensive income (e.g. to account for changes arising from revaluations of property, plant and equipment and foreign currency translations). The Group recognises its share of any such changes in other comprehensive income.

5. Earnings per share

   1. Basic earnings per share

      Earnings per share is calculated by dividing the profit or loss attributable to equity holders of the Parent (i.e., after tax and profit/loss attributable to non-controlling interests) by the weighted average number of shares outstanding during the reporting period.

      Accordingly:

      	FY 2024/25	FY 2023/24
      Profit/(loss) for the period attributable to equity holders of the parent (thousands of euros)	149,715	108,880
      Number of shares outstanding (note 14)	43,700,000	43,700,000
      Basic earnings per share (euros)	3.43	2.49

   2. Diluted earnings per share:

Diluted earnings per share is calculated similarly to basic earnings per share; however, the weighted average number of shares outstanding is adjusted to factor in the potential dilutive effect of options over the Parent's shares, warrants and convertible debt outstanding at each year-end.