Annual Results for the year ended 30 June 2025

About this update from Litigation Capital Management Ltd

[{"type":"text","content":"\n \n   \n 1 October 2025 \n   \n Litigation Capital Management Limited \n (\"LCM\" or the \"Company\") \n   \n Full year audited results for the year ended 30 June 2025 \n   \n Highlights \n   \n \n \n \n \n • \n \n \n Net realised gains of A$22.2m (FY24: A$23.0m), with concluded case investments generating a 1.8x multiple of invested capital (MOIC) \n \n \n \n \n • \n \n \n Total loss of A$82.0m (FY24: Total income of A$44.7m) following a number of trial losses, several of which are under appeal \n \n \n \n \n • \n \n \n Loss after tax for the period of A$72.9m (FY24: Profit after tax of A$12.7m) \n \n \n \n \n • \n \n \n Net assets of A$114.4m (FY24: A$188.9m) \n \n \n \n \n • \n \n \n Total new commitments of A$79m added in the period (FY24: A$279m) \n \n \n \n \n   \n Strategic Update \n   \n \n \n \n \n   • \n \n \n Strategic review commenced \n \n \n \n \n   • \n \n \n Strategic options to be benchmarked against lean run-off operating model \n \n \n \n \n   \n Commenting on the results, Patrick Moloney, CEO of Litigation Capital Management, said:   \"The last 12 months have been the most challenging in LCM's history as we experienced a series of adverse case outcomes impacting our financial performance.  These setbacks, while disappointing, have underscored the inherent risks of our asset class and the lessons we have learned are shaping our path forward.  Our team's resilience and decisive actions, including significant cost reductions and a refocused investment strategy, have laid a foundation for recovery.  Looking ahead, we are committed to restoring LCM's track record of delivering value through a reinvigorated focus on active management of case investments, a cornerstone of our historical success.\" \n   \n Analyst and investor presentation \n   \n The Company will also be hosting a live presentation for all existing and potential shareholders via the Investor Meet Company at 14:00 BST today. If you would like to attend this presentation, please register using the following link: \n   \n https://www.investormeetcompany.com/litigation-capital-management-limited/register-investor \n   \n The presentation is open to all existing and potential shareholders. Investors who already follow LCM on the Investor Meet Company platform will automatically be invited. \n   \n   \n Enquiries \n   \n \n \n \n \n Litigation Capital Management \n \n \n \n \n \n \n \n Patrick Moloney, Chief Executive Officer \n David Collins, Chief Financial Officer \n \n \n   \n \n \n \n \n \n \n \n   \n \n \n \n \n Cavendish (Nomad and Joint Broker) \n \n \n Tel: 020 7523 8000 \n \n \n \n \n Jonny Franklin-Adams and Isaac Hooper (Corporate Finance) \n Tim Redfern and Jamie Anderson (Corporate Broking) \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n   \n NOTES TO EDITORS \n Litigation Capital Management (LCM) is an alternative asset manager specialising in disputes financing solutions internationally, which operates two business models. The first is direct investments made from LCM's permanent balance sheet capital and the second is third party fund management. Under those two business models, LCM currently pursues three investment strategies: Single-case funding, Portfolio funding and Acquisitions of claims. LCM generates its income from both its direct investments and also performance fees through asset management. \n   \n LCM has an unparalleled track record driven by disciplined project selection and robust risk management. Currently headquartered in Sydney, with offices in London and Singapore, LCM listed on AIM in December 2018, trading under the ticker LIT. \n   \n www.lcmfinance.com \n   \n   \n   \n CEO Report \n This year has been the most challenging in LCM's history. Despite our established long-term track record of successful outcomes and consistent returns on invested capital, an unprecedented number of adverse case results have negatively impacted our performance over the past 12 months.  We recorded 6 wins against 6 losses in FY25, with a further 3 cases losing at trial during the period and now being under appeal.  Disappointingly, several of the adverse outcomes were for cases where we had invested significant shareholder capital.  While these results are reflective of the inherent binary risk in our asset class, they have fallen well short of our expectations and historical benchmarks. \n Post-year-end, we announced the termination of our investment in the Gladstone class action in Australia, which was initiated in 2018.  In our view, the expert evidence was insufficient to support the case theory and we therefore took the difficult decision to terminate rather than incur significant further trial-related costs. The settlement includes payment of costs, fully covered by After-the-Event Insurance, and we are pursuing potential recoveries through a costs assessment and a negligence claim against the initial solicitors. \n While these setbacks have tested our resilience, they have also provided valuable insights. We are committed to applying the lessons learned to strengthen our operations, refine our strategy, and reposition LCM for long-term recovery. \n Lessons Learned \n As LCM has grown, expanded internationally, and transitioned into a funds management business, my role as CEO has evolved to meet the demands of this transformation. Previously centred on managing legal investments through daily engagement with solicitors, barristers, and independent experts, my focus has shifted toward driving strategic expansion. This has involved working closely with investment bankers, financial intermediaries, and capital providers to position LCM for long-term success in the funds management space. \n This strategic shift has been instrumental in enabling LCM's transition to a funds management model, where we have raised significant private capital to fuel growth. To support this evolution, we strengthened our team by recruiting highly skilled legal professionals from leading law firms and litigation funders to oversee day-to-day investment management. While their expertise has been invaluable, I recognise that our approach to investment management may not have fully sustained the proactive and tenacious rigor that defined LCM's earlier success. \n In recent years, our investment management strategy may have, at times, aligned more closely with the industry's standard lawyer-led approach. Unlike many of our single-case peers, LCM's historical strength has been our hands-on, active investment management, which has driven superior outcomes. Reflecting on this, I see an opportunity to reinvigorate our unique approach to ensure we return to delivering attractive multiples on invested capital. \n In my view, without genuinely active investment management, it is very difficult to deliver attractive returns in this asset class-despite it having appealing characteristics, such as being uncorrelated to broader economic cycles and offering the potential for significant returns when good investments are selected and managed appropriately. \n LCM's historic success was built on our unique approach to active investment management, particularly due to our origins in the Australian market, where funders can contribute to case strategy.  I am now entirely focussed on returning to the area where I believe I can add the most value: the hands-on rigour of active investment management. \n I have already initiated actions on the existing portfolio to proactively realign it. I am doing so, working alongside two key colleagues with whom I have collaborated for over a decade and with whom I built our previously industry-leading track record. \n This review of the portfolio and of recent losses has led to a number of conclusions and subsequent actions including: \n ·      Decisive Action on Underperforming Investments : In good faith, we have attempted to salvage challenged investments by injecting additional resources such as enhancing legal teams. In hindsight, this has at times led to escalating commitments, especially in larger legacy positions, leading to suboptimal capital allocation. Going forward, we will emphasize rapid evaluations and timely exits where warranted to preserve capital. \n ·      Managing Concentration Risk : This challenge is interconnected with delayed action on underperformers, allowing certain positions to become disproportionately large.  We are dedicated to mitigating future risks through balanced investment sizing, fostering optimal risk-adjusted returns. \n ·      Enhanced Scrutiny of Expert Evidence : A recurring factor in recent losses has been insufficient critical evaluation of expert reports, as case lawyers often lack the quantitative expertise to challenge them effectively. To counter this, we are instituting a more rigorous due diligence process, including engagement of independent quantitative specialists and integration of advanced analytical tools early in case assessments. This will ensure evidence is thoroughly vetted, minimizing the impact of flawed damages assumptions. \n Strategic Review \n In the second half of FY25, following our series of losses and the resulting higher leverage position, we intensified efforts to explore strategic options. We have proactively engaged with a diverse range of counterparties to assess potential transactions, including capital raises, strategic partnerships, and asset sales. These discussions have generated some promising leads. \n To advance these opportunities in a structured manner, we appointed Luminis Partners as our independent financial advisor. The strategic review is now well progressed, with advanced discussions underway with a number of counterparties. \n Furthermore, our dialogue with our lender has been constructive.  Considering the recent adverse case results that LCM has experienced, we have been in discussions with the lender for a period of time. Based on these discussions, we understand that the lender's current intention is to continue to support LCM for the next 12 months as the management team completes the strategic review. The lender's intention is subject to ongoing review and may be reconsidered in light of future developments or changes in LCM's circumstances. \n As well as considering external opportunities, we are also repositioning the business organically to put us on a sustainable footing.  This encompasses a transition to a run-off model with a concentrated effort to manage our existing investments to realise value for shareholders.  Consistent with this plan, we have taken significant action on our cost base, reducing our operating expenses by half, and with the scope for further meaningful reductions as we reposition our investment management approach. \n Dubai \n It was reported in May 2025 by one publication that Dubai prosecutors were formally probing London-listed Litigation Capital Management (LCM) of corruption offences, alongside its CEO Patrick Moloney. This included money laundering.  It was subsequently reported by the same publication that Dubai prosecutors had formally accused London-listed Litigation Capital Management (LCM) of such corruption offences. LCM made it clear immediately it had never been contacted about such a case, and was not aware of any such investigation or formal allegations. Rumours of the probe had evidently been circulating in certain areas of the disputes sector by late 2024 the publication reported. \n While LCM has been fully exonerated in this matter, the process has clearly negatively impacted the company, affecting multiple key business areas and restricting strategic opportunities that were advanced at the time including the anticipated first close of Fund III.  In our view, it cannot be disputed that this was entirely avoidable if LCM had been approached at an early state of any investigation, rather than finding out about this process from a press leak. Such approach would have made it clear to the relevant UAE authorities that LCM had absolutely no case to answer as has now formally been confirmed, and the investigation was entirely ill conceived and potentially malicious. Due process was not followed and the financial impact has been significant.   \n \nWe are actively reviewing our legal options to ensure the company can be compensated to the full extent possible.   \n   \n In May, we addressed online press speculation regarding a potential investigation against the Company by a Dubai legal authority. We have since been notified that the investigation has concluded, with all allegations against LCM and myself fully dismissed. Furthermore, we understand that the dismissal includes a scathing verdict highlighting a complete lack of due process in the investigation, which led to the baseless allegations that were improperly leaked to the press. \n The wholly unacceptable disclosure of this matter through media channels, rather than through official communication from the Dubai authorities, caused profound disruption to LCM's operations. This forced us to pause critical initiatives and pivot to alternative strategies. Notably, we were compelled to suspend fundraising for Fund III, which was on the cusp of a first close in early May. Additionally, preliminary discussions for a strategic review-later announced in September-were significantly delayed. This unwarranted postponement has materially undermined LCM's negotiating position and significantly hindered our ability to advance key strategic objectives. \n Looking Forward \n Through the actions we are taking, we are dedicated to restoring profitability and delivering value to shareholders. I extend my sincere appreciation to our dedicated team and loyal investors for their support during this trying time. \n   \n   \n Chairman's Statement \n Dear Shareholder, \n In reviewing the past financial year I acknowledge the significant challenges LCM has encountered. FY25 has been the most difficult year in the company's history marked by an unprecedented number of case losses that have adversely affected our financial performance and cash flows. Despite these setbacks, our team has demonstrated resilience, taking decisive actions to stabilise the business amid near-term pressures from elevated debt levels. We remain committed to our long-term vision while prioritising financial stability. \n To address these challenges we have right-sized operations, significantly reducing operating expenses through disciplined cost management. This included difficult decisions such as reducing headcount, carefully evaluating our overheads, and streamlining processes to enhance efficiency without compromising our core capabilities. New commitments were scaled back as we focused on high-quality opportunities and capital preservation, ensuring resources are allocated to deliver maximum value. Additionally, we conducted a thorough review of our fair value accounting, introduced two years ago, and adopted a more conservative approach in light of recent disappointing results. \n The financial strain from case losses and reduced cash realisations increased our reliance on our debt facility. As a result, the Board has made the prudent decision to not pay a dividend, redirecting our focus to strengthening the balance sheet. These measures, though challenging, are critical to securing LCM's financial position and laying the groundwork for future stability.  The binary nature of our investments means that in light of our increased indebtedness there is a risk that in certain circumstances, further case losses could lead to a breach of LCM's debt covenants.  As a result, we are reporting a material uncertainty in relation to our going concern status (further detail on page 39).  The management team have been proactively engaging with the lender over the last few months.  The lender has indicated that its current intention, which is subject to ongoing review and may be reconsidered in light of future developments or change in LCM's circumstances, is to continue to support LCM for the next 12 months as we advance the strategic review announced on 15 September 2025. \n Looking ahead we are now focused on completing the strategic review, evaluating all options to realise value for shareholders.  These options will be benchmarked against a lean run-off model, which would involve further reductions in operating expenses and a shift to managing our existing portfolio of assets through to conclusion.  Under this model, proceeds from successful case investments would be prioritised to reduce debt, with the long-term goal of delivering value for shareholders.  We are committed to executing this review with rigour and transparency, keeping you informed as we shape the company's path forward.    \n This year also marked the departure of Gerhard Seebacher from the Board after over four years of service as a Non-Executive Director. Gerhard brought valuable expertise in financial services and fund management, contributing to our strategic discussions and governance. On behalf of the Board, I would like to thank Gerhard for his guidance during his tenure, and we wish him well in his future endeavours. \n I am deeply grateful to our team for their unwavering commitment during this challenging period. I also extend my thanks to our shareholders for your continued support and trust, which are vital to our ongoing efforts. \n We will keep you informed of our progress in the year ahead. \n Jonathan Moulds \nNon-Executive Chairman \n   \n Finance Review \n   \n   \n \n \n \n \n Income Statement (A$'m) - LCM Only \n \n \n FY25 \n \n \n FY24 \n \n \n \n \n Concluded investments - Proceeds on LCM capital \n \n \n 36.6 \n \n \n 31.3 \n \n \n \n \n Concluded investments - Performance fees on 3P capital \n \n \n 13.1 \n \n \n 12.7 \n \n \n \n \n Concluded investments - LCM capital invested (\"Cost\") \n \n \n (27.5) \n \n \n (21.0) \n \n \n \n \n Net realised gains from concluded investments \n \n \n 22.2 \n \n \n 23.0 \n \n \n \n \n Litigation service revenue / (loss) \n \n \n (5.5) \n \n \n 9.2 \n \n \n \n \n Fair value movement: \n \n \n   \n \n \n \n \n \n \n \n Fair value removal for concluded investments \n \n \n (49.0) \n \n \n (33.0) \n \n \n \n \n Fair value write-down on case losses under appeal \n \n \n (44.5) \n \n \n - \n \n \n \n \n Net fair value movement on pre-hearing/trial ongoing investments and FX \n \n \n (6.6) \n \n \n 45.4 \n \n \n \n \n Net fair value movement \n \n \n (100.1) \n \n \n 12.5 \n \n \n \n \n Other income \n \n \n 1.4 \n \n \n - \n \n \n \n \n Total income / (loss) \n \n \n (82.0) \n \n \n 44.7 \n \n \n \n \n Operating expenses \n \n \n (18.0) \n \n \n (19.0) \n \n \n \n \n FX gains/losses \n \n \n 5.7 \n \n \n 0.5 \n \n \n \n \n Operating profit \n \n \n (94.4) \n \n \n 26.3 \n \n \n \n \n Finance costs \n \n \n (7.3) \n \n \n (10.2) \n \n \n \n \n Profit before tax \n \n \n (101.7) \n \n \n 16.1 \n \n \n \n \n Tax \n \n \n 28.8 \n \n \n (3.3) \n \n \n \n \n Net income \n \n \n (72.9) \n \n \n 12.7 \n \n \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n Basic EPS (cents) \n \n \n (70.83) \n \n \n 12.01 \n \n \n \n \n Diluted EPS (cents) \n \n \n (70.83) \n \n \n 11.33 \n \n \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n   \n Investments that realised in the period generated a 1.8x multiple of invested capital (MOIC) for LCM.  Those realisations included six wins and six losses, with the positive performance primarily driven by the arbitration win for funded party, Green-X Metals Limited, against the State of Poland, contributing A$26.1 million of net realised gains, and an arbitration claim against Tanzania contributing A$12.0 million of net realised gains.  Those successful cases were offset by losses, the detail being set out in the table below. \n   \n Three cases with total LCM invested capital of A$45.1 million lost at trial and are either under appeal or seeking permission to appeal.  \n   \n \n \n \n \n Realised Wins \n \n \n Invested capital \n \n \n Proceeds \n (incl perf fee) \n \n \n MOIC \n \n \n \n \n Australia Insolvency \n \n \n 1.0 \n \n \n 1.9 \n \n \n 1.9 \n \n \n \n \n Treaty Arbitration \n \n \n 1.5 \n \n \n 13.5 \n \n \n 9.0 \n \n \n \n \n US Insolvency \n \n \n 0.2 \n \n \n 0.3 \n \n \n 1.5 \n \n \n \n \n Treaty Arbitration \n \n \n 4.5 \n \n \n 30.6 \n \n \n 6.8 \n \n \n \n \n UK Litigation \n \n \n 0.2 \n \n \n 0.4 \n \n \n 2.0 \n \n \n \n \n Australia Insolvency \n \n \n 0.2 \n \n \n 0.9 \n \n \n 4.5 \n \n \n \n \n Total realised gains \n \n \n 7.6 \n \n \n 47.6 \n \n \n 6.3 \n \n \n \n \n   \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n Realised Losses \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n UK litigation \n \n \n 6.7 \n \n \n 0.0 \n \n \n 0.0 \n \n \n \n \n UK Class Action \n \n \n 1.0 \n \n \n 0.0 \n \n \n 0.0 \n \n \n \n \n US IP \n \n \n 4.5 \n \n \n 0.0 \n \n \n 0.0 \n \n \n \n \n Competition \n \n \n 1.9 \n \n \n 0.0 \n \n \n 0.0 \n \n \n \n \n Competition \n \n \n 1.7 \n \n \n 0.0 \n \n \n 0.0 \n \n \n \n \n Commercial Arbitration \n \n \n 2.6 \n \n \n 0.0 \n \n \n 0.0 \n \n \n \n \n Total realised Losses \n \n \n 18.4 \n \n \n 0.0 \n \n \n 0.0 \n \n \n \n \n   \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n Partial Realisations \n \n \n 1.7 \n \n \n 2.2 \n \n \n   \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Total \n \n \n 27.5 \n \n \n 49.7 \n \n \n 1.8 \n \n \n \n \n   \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n Losses under appeal \n \n \n Invested capital \n \n \n Proceeds (incl perf fee) \n \n \n MOIC \n \n \n \n \n Aus class action \n \n \n 26.1 \n \n \n 0.9 \n \n \n 0.0 \n \n \n \n \n Aus class action \n \n \n 13.7 \n \n \n - \n \n \n 0.0 \n \n \n \n \n UK commercial arbitration \n \n \n 5.3 \n \n \n - \n \n \n 0.0 \n \n \n \n \n Total Losses under appeal \n \n \n 45.1 \n \n \n 0.9 \n \n \n 0.0 \n \n \n \n \n   \n Note: Above figures are on an LCM only basis \n   \n The Litigation service revenue / (cost) line in the above P&L captures the results for the small number of cases that are held at contract cost under AASB 15 (as opposed to fair value accounting under AASB 9).  One of the cases that is accounted for under AASB 15 lost at trial during the period and is being appealed.  We are now taking the approach of holding such cases within a range of 50-60% of cost (see further detail below) as opposed to the prior approach of holding such losses under appeal at cost.  That is the reason for the litigation service loss in the period (writedown of asset value to below cost).  The prior period included a successful resolution of one of the cases held under AASB 15 which produced the positive revenue figure. \n   \n The net fair value movement in the period was negative at A$100.1m (FY24: positive A$12.5 million) and this is broken down into three components described below.  \n   \n The first component is the fair value removal for investments that concluded in the period.  As investments conclude we remove the fair value held against them (via this line) and replace that value with the actual result realised (in Net realised gains section of the P&L).  Therefore, this line item will likely be negative each time we report, reflecting the removal of the fair value uplift on cases that concluded in the period.    \n   \n Thus, all of the investments that realised in the period were held at a cumulative fair value of A$76.6 million (FY24:  A$54.7 million) prior to realisation, being the cumulative fair value uplift of those investments (A$49.0 million; FY24 A$30.9 million) plus the capital invested into them (A$27.5 million; FY24 A$23.8 million).  That fair value prior to realisation was equal to a multiple of cash invested of 2.8x.   \n   \n The proportion of losses in the period being much higher than LCM's long-term average is a key reason why the realised MOIC (1.8x) on concluded cases is lower than their fair value MOIC prior to realisation (2.8x). \n   \n The second component of the fair value movement relates to two cases that lost at trial during the period and are being appealed. Our previous approach to accounting for cases that lost and are under appeal was to hold such investments at cost until the outcome of the appeal.  In light of the series of losses that LCM has experienced in the last 12 months we have adopted a more conservative approach to valuing cases under appeal.  Going forward, we will hold such cases at a value of between 50% and 60% of cost until the outcome of the appeal.  This reflects that while the investment that was made to finance the first trial is still recoverable in the event of a successful appeal, the value of that asset today should be impaired to reflect the negative setback associated with the trial loss. \n   \n The total writedown on the two cases that lost and are under appeal was A$44.5 million, comprising A$29.0 million to remove the fair value uplift on those cases prior to appeal and a further A$15.6 million to move their valuations below cost to within the 50-60% of cost range.  \n   \n The third component of the fair value movement, being the remaining fair value movements on ongoing case investments was a loss in the period of A$6.6 million (FY24: a gain of A$43.3 million).  This loss has emerged as a result of a review of the fair value model that has been conducted in light of the recent disappointing case results.  Two years after fair value accounting was first introduced and after the recent run of adverse case outcomes, the Board deemed it prudent for the Chief Financial Officer to reassess the fair value model, incorporating recent experience and his insights gained after more than 12 months in the role.  \n   \n The review of the fair value assumptions highlighted a number of areas requiring enhancement.  Expected profit assumptions have been lowered for a number of group claims (such as class actions) reflecting recent industry experience;  duration assumptions have been modestly lengthened also reflecting recent experience; and the risk adjustment factors within the model have been adjusted to slow the rate of fair value recognition as a case passes through the different stages of proceedings as we aim to ensure that incremental fair value is only recognised when there has been clear and demonstrable evidence of meaningful case progress. \n   \n The changes that have been made to the fair value assumptions result in lower fair values at the end of the period and what will be a more conservative rate of fair value recognition going forward.  After these assumption changes, ongoing cases (excluding the three cases that are accounted for at historical cost) are valued at 1.3x cash invested at the end of the period. \n   \n It is important to note that valuing LCM's investments is a subjective and difficult exercise due to the binary nature of the investments and we expect that enhancements to the fair value model will be a continuous process as LCM and the wider industry gains more case experience.  The binary outcome nature of LCM's single case investments means that actual realised outcomes can differ significantly to the fair value those investments are held at prior to conclusion.    \n   \n The above factors have led LCM to report a total loss in the period of A$82.0 million (FY24: A$44.7 million total income).    \n   \n Operating expenses declined to A$18.0 million from A$19.0 million in the prior period.  Management started taking action to reduce the cost base in the latter part of the second half and following further actions taken post period end we have significantly reduced the cost base to an annual rate of around half the equivalent rate from 12 months ago and this reduction will come through visibly in FY26.  \n   \n Foreign exchange gains of A$5.7 million (FY24: gain of A$0.5 million) arose primarily as a result of the weakening of the USD in the second half with approximately half of LCM's outstanding debt denominated in USD.  \n   \n This all resulted in an operating loss for the year of A$94.4 million (FY24: operating profit of A$26.3 million).  After debt interest costs of A$7.3 million, which were down on the prior year (A$10.2 million) primarily due to the lower interest rate on the debt facility that was negotiated with the facility's extension in December of 2024, we are reporting a loss before tax of A$101.7 million (FY24: A$16.1 million).  After tax this loss reduces to A$72.9 million (FY24: profit after tax of A$12.7 million).  In light of this result, the Board has cancelled the dividend (FY24: 1.25p). \n   \n \n \n \n \n Balance Sheet (A$'m) - LCM Only \n \n \n FY25 \n \n \n FY24 \n \n \n \n \n Cash \n \n \n 8.9 \n \n \n 53.0 \n \n \n \n \n Debtors \n \n \n 30.6 \n \n \n 15.0 \n \n \n \n \n Investments at fair value \n \n \n 124.8 \n \n \n 202.9 \n \n \n \n \n Investments held at cost \n \n \n 48.0 \n \n \n 42.1 \n \n \n \n \n Other assets \n \n \n 1.7 \n \n \n 1.5 \n \n \n \n \n Total assets \n \n \n 214.0 \n \n \n 314.4 \n \n \n \n \n Borrowings \n \n \n (77.7) \n \n \n (61.9) \n \n \n \n \n Tax payable \n \n \n (0.0) \n \n \n (0.9) \n \n \n \n \n Deferred tax liability \n \n \n (15.3) \n \n \n (43.6) \n \n \n \n \n Other creditors \n \n \n (6.6) \n \n \n (20.0) \n \n \n \n \n Total liabilities \n \n \n (99.6) \n \n \n (125.5) \n \n \n \n \n Net assets \n \n \n 114.4 \n \n \n 188.9 \n \n \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n NAV per share (pence) - Basic \n \n \n 53.2 \n \n \n 94.4 \n \n \n \n \n NAV per share (pence) - Diluted \n \n \n 50.3 \n \n \n 89.0 \n \n \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n   \n As of 30 June 2025, LCM was actively invested in 53 ongoing cases (FY24: 58) with a total balance sheet value of A$172.8 million (FY24: A$245.0 million).  This valuation includes A$48.0 million related to three investments (FY24: A$42.1 million) that are accounted for under AASB 15 for historic accounting reasons, and A$124.8 million (FY24: A$202.9 million) for 50 investments (FY24: 55) that are held at fair value (AASB 9). \n   \n As previously noted, at the period end our case investments are held at an aggregate value of 1.3x the cumulative LCM cash invested into those cases (FY24: 2.4x) excluding the three cases accounted under AASB 15.  \n   \n Cash at the period end was A$8.9 million, down significantly on the prior year (FY24: A$53.0 million) due to the ongoing cash outflows associated with case funding, operating expenses and interest payments not being offset by meaningful cash realisations as a result of the disproportionate number of losses in the period.  When offset against borrowings of A$77.7 million (FY24: A$61.9 million) the net debt position at the end of the period increased to A$68.9 million (FY24: A$8.9 million).  \n   \n Debtors have increased in the period, primarily attributable to the Green-X Metals case against Poland, which has been booked as a realised investment despite ongoing set-aside proceedings, as we view the likelihood of both awards (Green-X has secured both an Energy Charter Treaty award and a Australia-Poland Bilateral Investment Treaty award) being set aside as being very low.  This view is supported by historical statistics that show set-aside proceedings typically succeed only in the single digit percentages of cases.  As Poland has to win two set-aside proceedings to avoid payment that would imply a probability of the award being overturned via the set-aside proceedings of less than 1%.  Furthermore, Donald Tusk, the prime minister of Poland, made a public statement in October 2024 following the awards saying that he believed that Poland will ultimately have to pay Green-X Metals Ltd as a consequence of the lost arbitration.  So, as we believe the main risk from here is enforcement / collection risk rather than litigation risk, this asset is now recorded as a debtor rather than an investment at fair value.  \n   \n From the prior period, all but A$1.8 million of the debtor balances at the end of FY24 (A$15.0 million) were collected in FY25.     \n   \n Beyond borrowings, deferred tax of A$15.3 million is the next largest liability on the balance sheet. A$4.0 million of this relates to deferred tax on the fair value of our investments, with the balance due to historic case funding on ongoing cases that has already been recognised as an expense within our tax accounting.  \n   \n As a result of the large loss in the period, net assets declined to A$114.4 million (FY24: A$188.9 million).  Net assets per share at the end of the period was 50.3 pence on a fully diluted basis (FY24: 89.0 pence).  \n   \n   \n \n \n \n \n Cash Flow Statement (A$'m) - LCM Only \n \n \n FY25 \n \n \n FY24 \n \n \n \n \n Opening cash balance \n \n \n 53.0 \n \n \n 83.0 \n \n \n \n \n Cash generated from concluded investments \n \n \n 33.6 \n \n \n 56.7 \n \n \n \n \n Cash invested into ongoing cases (case funding) \n \n \n (59.8) \n \n \n (39.7) \n \n \n \n \n Operating expenses \n \n \n (16.0) \n \n \n (17.0) \n \n \n \n \n Net finance costs paid \n \n \n (6.5) \n \n \n (9.0) \n \n \n \n \n Dividend and share buyback \n \n \n (8.0) \n \n \n (10.4) \n \n \n \n \n Debt drawdown/repayments \n \n \n 12.2 \n \n \n (8.1) \n \n \n \n \n Other \n \n \n 0.4 \n \n \n (2.5) \n \n \n \n \n Closing cash balance \n \n \n 8.9 \n \n \n 53.0 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Net debt \n \n \n 68.9 \n \n \n 8.9 \n \n \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n   \n During the period, cash generated from concluded investments in the period amounted to A$33.6 million (FY24: A$56.7 million), inclusive of A$6.4 million in performance fees (FY24: A$12.7 million).  This included A$13.2m of debtors from the prior period end that were collected in the period. \n   \n The cash invested in case funding in the period totalled A$59.8m million (FY24: A$39.7 million), spread across 69 investments, of which 53 remained ongoing at the period end. \n   \n Operating expenses were lower than the prior period at A$16.0 million (FY24: A$17.0 million).  The difference between this figure and the amount shown in the P&L primarily relates to share based payments, and reimbursements of operating expenses (in relation to fund management) which are disclosed as other income in the P&L.   \n   \n Net finance costs paid declined to A$6.5 million (FY24: A$9.0 million) driven by the lower interest rate on the new debt facility.  The difference between this figure and the amount shown in the P&L is interest accrued. \n   \n Tax paid was A$0.6 million (FY23: A$2.8 million) relating to UK tax paid on successful case conclusions in the prior financial year. \n   \n As a result of the lower cash coming into the business from successful case resolutions we drew down A$12.2 million from the debt facility (FY24:  A$8.1 million repayment) to meet case funding, operating expenses and interest payments. \n   \n At the end of the financial period, we held A$8.9 million in cash (FY24: A$53.0 million) and had a net debt position of A$68.9 million (FY23: A$8.9 million). \n   \n New Commitments section \n New commitments declined during the period to A$79.2 million (FY24: A$279.0 million), as our focus shifted to reducing balance sheet strain following the increase in leverage during the period.   \n   \n   \n Committed and Invested Capital   \n   \n \n \n   \n As of the end of the period, LCM was actively invested in 53 ongoing case investments.  Among these, 11 were fully funded by our balance sheet (of which 3 cases comprise the majority of that invested capital) while 42 were co-funded through our asset management model, where LCM typically funds 25% of the investment cost. \n   \n Committed capital, which represents LCM share of total commitments across all active cases net of conclusions and terminations decreased to A$269.3 million at the period end (FY24: A$311.9 million).  Of this amount, A$157.5 million gross has been deployed to date. \n   \n Asset Management \n   \n Since 2020, we have been transitioning our business model to that of an asset manager with cases funded typically 25% from our own balance sheet and 75% from third party funds.  To date we have raised USD441 million in external funds across two funds:  Fund I (USD150 million) and Fund II (USD291 million).  \n   \n Fund I has invested in 23 case investments (net of 3 terminations) and was fully committed and 85% deployed at the end of the period.  Twelve of these investments (9 wins and 3 losses) have fully concluded generating gross proceeds of US$121.3 million on LP invested capital of US$54.9 million.  After accounting for performance fees of US$28.9 million paid to LCM, LP investors have achieved a 1.7 Net MOIC and a net IRR of 30.4% on realisations to date.  \n   \n Fund II has invested into 37 cases (net of 13 terminations) and recently closed to new investments.  The fund closed to new business at around 65% committed and was approaching US$50 million deployed as at 30 June 2025.  Five investments have concluded to date (2 wins and 3 losses) generating an aggregate MOIC of 0.2x.     \n   \n Post Period End \n   \n On 15 September 2025 we announced that LCM had terminated its investment in the Australian class action against Gladstone Ports Corporation in relation to alleged losses suffered by commercial fishermen from the large scale contamination of Gladstone harbour and surrounding waters from a toxic dredge spill in 2011-12.  The investment was held on LCM's balance sheet at an amount of A$30.8 million, being equal to the cash invested into the case.  \n   \n The review of this investment has identified two avenues for potential recovery of a material part of LCM's capital invested.  Firstly, we believe that the firm of solicitors, who initially acted for the claimants in this claim, overcharged for legal services supplied to the claimants and we have commenced a costs assessment seeking reimbursement of a portion of the legal costs paid by LCM.  Secondly, we are investigating a claim against those same solicitors for breach of contract and negligence in association with the legal services provided for the claim. \n   \n Post period end, LCM is awaiting the outcome of a trial in relation to a separate investment in UK commercial litigation, co-funded alongside Fund I, into which LCM has invested A$20.6 million of its own capital.  The judgment is expected in early October.  \n   \n Furthermore, having previously sought permission to appeal the commercial arbitration loss that was announced on 1 April 2025, LCM expects to hear if permission has been granted in the near term and will update the market accordingly.  \n   \n Going Concern - Material Uncertainty \n   \n Given the number of adverse case outcomes in recent months, which have impacted cash inflows and increased indebtedness, the Directors have considered a range of scenarios, including plausible downside scenarios, and note that in certain circumstances, further case losses could lead to a breach of LCM's debt covenants.  \n   \n LCM's lender has granted a debt covenant waiver through to 30 December 2025 and as part of this arrangement the interest rate on the loan increases by 2.00% per annum during the waiver period, and a one-time waiver fee equal to 1.50% of the principal amount outstanding will be payable. \n   \n While LCM's lender has been responsive in providing near-term covenant waivers to date, any further amendments, should they be required, will be subject to negotiation. This assessment is linked to a robust evaluation of the principal risks facing LCM and the potential impact of these risks being realised. \n   \n After considering LCM's forecasts, stress testing and available mitigating actions, and having regard to the inherent risks associated with the binary nature of LCM's investment model, the Directors have concluded that a material uncertainty exists which may cast significant doubt on LCM's ability to continue as a going concern. \n   \n The material uncertainty relates to LCM's ability to comply with its debt covenants in the event of certain adverse case outcomes. The Directors have a reasonable expectation, based on current discussions, that LCM will continue to receive the necessary support from its lender to allow it to continue in operational existence for the foreseeable future. Accordingly, the financial statements have been prepared on a going concern basis, whilst noting the material uncertainty above. \n   \n Key Performance Indicators \n   \n \n \n \n \n \n \n \n FY22 \n \n \n FY23 \n \n \n FY24 \n \n \n FY25 \n \n \n \n \n Funds under management (US$m) \n \n \n 340 \n \n \n 441 \n \n \n 441 \n \n \n 339 \n \n \n \n \n Track record (MOIC) \n \n \n 2.6x \n \n \n 2.8x \n \n \n 2.9x \n \n \n 2.0x \n \n \n \n \n New commitments (A$m) \n \n \n 104 \n \n \n 176 \n \n \n 279 \n \n \n 84 \n \n \n \n \n Committed capital \n \n \n 414 \n \n \n 484 \n \n \n 724 \n \n \n 611 \n \n \n \n \n Invested capital (in period) \n \n \n 66 \n \n \n 95 \n \n \n 102 \n \n \n 109 \n \n \n \n \n Cumulative invested capital (in ongoing cases) \n \n \n 184 \n \n \n 227 \n \n \n 281 \n \n \n 301 \n \n \n \n \n   \n Consolidated statement of profit or loss and other comprehensive income \n For the period ended 30 June 2025 \n   \n \n \n \n \n \n \n \n \n \n \n Consolidated \n \n \n   \n \n \n \n \n   \n \n \n \n \n \n 2025 \n \n \n 2024 \n \n \n   \n \n \n \n \n   \n \n \n Note \n \n \n $'000 \n \n \n $'000 \n \n \n   \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n Income \n \n \n   \n \n \n \n \n \n \n \n \n   \n \n \n \n \n Net realised gain on investments \n \n \n 5 \n \n \n 43,643 \n \n \n  61,778 \n \n \n   \n \n \n \n \n Net unrealised gain/(loss) on investments \n \n \n 5 \n \n \n  (206,767) \n \n \n  25,149 \n \n \n   \n \n \n \n \n Movement in financial liabilities related to third-party interests in consolidated entities \n \n \n 5 \n \n \n  90,133 \n \n \n  (48,382) \n \n \n   \n \n \n \n \n Litigation service revenue \n \n \n 5 \n \n \n - \n \n \n  12,443 \n \n \n   \n \n \n \n \n Litigation service expense \n \n \n 5 \n \n \n (5,468) \n \n \n (3,236) \n \n \n   \n \n \n \n \n Total income/(loss) \n \n \n   \n \n \n  (78,459) \n \n \n  47,752 \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n  Expenses \n \n \n   \n \n \n \n \n \n \n \n \n   \n \n \n \n \n  Employee benefits expense \n \n \n 6 \n \n \n (12,061) \n \n \n (11,471) \n \n \n   \n \n \n \n \n  Depreciation expense \n \n \n 6 \n \n \n (93) \n \n \n (145) \n \n \n   \n \n \n \n \n  Corporate expenses \n \n \n 6 \n \n \n (4,841) \n \n \n (5,171) \n \n \n   \n \n \n \n \n  Fund administration expense \n \n \n 6 \n \n \n (1,965) \n \n \n (3,400) \n \n \n   \n \n \n \n \n  Foreign currency gains/(losses) \n \n \n 6 \n \n \n 3,027 \n \n \n (1,432) \n \n \n   \n \n \n \n \n  Total operating expenses \n \n \n (15,933) \n \n \n (21,619) \n \n \n \n \n Operating profit/(loss) \n \n \n   \n \n \n (94,392) \n \n \n 26,133 \n \n \n   \n \n \n \n \n  Finance costs \n \n \n 6 \n \n \n (7,295) \n \n \n (10,083) \n \n \n   \n \n \n \n \n Profit/(loss) before income tax expense \n \n \n (101,687) \n \n \n 16,050 \n \n \n \n \n  Income tax (expense)/benefit \n \n \n 7 \n \n \n (28,774) \n \n \n (3,335) \n \n \n   \n \n \n \n \n Profit/(loss) after income tax expense \n \n \n (72,913) \n \n \n 12,715 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n Other comprehensive income \n \n \n   \n \n \n \n \n \n \n \n Items that may be subsequently reclassified to profit and loss: \n \n \n \n \n \n \n \n \n \n \n Movement in foreign currency translation reserve \n \n \n 5,128 \n \n \n 2,013 \n \n \n \n \n Total comprehensive income for the period \n \n \n (67,785) \n \n \n 14,728 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n Profit/(loss) for the period is attributable to: \n \n \n \n \n \n \n \n \n \n \n Owners of Litigation Capital Management Limited \n \n \n (72,913) \n \n \n 12,715 \n \n \n \n \n \n \n \n \n \n \n (72,913) \n \n \n 12,715 \n \n \n   \n \n \n \n \n Total comprehensive income for the period is attributable to: \n \n \n \n \n \n \n \n \n \n \n Owners of Litigation Capital Management Limited \n \n \n (67,785) \n \n \n 14,728 \n \n \n \n \n \n \n \n \n \n \n (67,785) \n \n \n 14,728 \n \n \n   \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n Cents \n \n \n Cents \n \n \n   \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n Basic earnings/(loss) per share \n \n \n 8 \n \n \n (70.83) \n \n \n 12.01 \n \n \n   \n \n \n \n \n Diluted earnings/(loss) per share \n \n \n 8 \n \n \n (70.83) \n \n \n 11.33 \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n   \n   \n   \n The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with accompanying Notes to the Financial Statements. \n   \n   \n Consolidated statement of financial position \n For the period ended 30 June 2025 \n   \n \n \n \n \n \n \n \n \n \n \n Consolidated \n \n \n \n \n \n \n \n \n \n \n 2025 \n \n \n 2024 \n \n \n \n \n   \n \n \n Note \n \n \n $'000 \n \n \n $'000 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Assets \n \n \n   \n \n \n \n \n \n \n \n \n \n \n Cash and cash equivalents \n \n \n 9 \n \n \n 18,447 \n \n \n 68,113 \n \n \n \n \n Trade receivables \n \n \n 10 \n \n \n 1,786 \n \n \n 10,986 \n \n \n \n \n Due from resolution of financial assets \n \n \n 11 \n \n \n 88,201 \n \n \n 3,980 \n \n \n \n \n Contract costs \n \n \n 12 \n \n \n 47,988 \n \n \n 42,072 \n \n \n \n \n Investments \n \n \n 13,21 \n \n \n 287,735 \n \n \n 465,213 \n \n \n \n \n Property, plant and equipment \n \n \n 135 \n \n \n 157 \n \n \n \n \n Intangible assets \n \n \n \n \n \n 439 \n \n \n 305 \n \n \n \n \n Other assets \n \n \n \n \n \n 827 \n \n \n 977 \n \n \n \n \n Total assets \n \n \n   \n \n \n 445,558 \n \n \n 591,803 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Liabilities \n \n \n   \n \n \n \n \n \n \n \n \n \n \n Trade and other payables \n \n \n 14 \n \n \n 10,508 \n \n \n 30,376 \n \n \n \n \n Tax payable/(refund) \n \n \n \n \n \n (6) \n \n \n 883 \n \n \n \n \n Employee benefits \n \n \n \n \n \n 1,115 \n \n \n 1,112 \n \n \n \n \n Borrowings \n \n \n 15 \n \n \n 77,747 \n \n \n 61,917 \n \n \n \n \n Financial liabilities related to third-party interests in consolidated entities \n \n \n 16 \n \n \n 226,538 \n \n \n 264,950 \n \n \n \n \n Deferred tax liability \n \n \n 7 \n \n \n 15,286 \n \n \n 43,624 \n \n \n \n \n Total liabilities \n \n \n   \n \n \n 331,188 \n \n \n 402,862 \n \n \n \n \n Net assets \n \n \n   \n \n \n 114,370 \n \n \n 188,941 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Equity \n \n \n   \n \n \n \n \n \n \n \n \n \n \n Issued capital \n \n \n 17 \n \n \n 60,634 \n \n \n 69,674 \n \n \n \n \n Treasury shares \n \n \n 17 \n \n \n - \n \n \n (5,396) \n \n \n \n \n Reserves \n \n \n \n \n \n 8,838 \n \n \n 4,171 \n \n \n \n \n Retained earnings \n \n \n \n \n \n 44,899 \n \n \n 120,492 \n \n \n \n \n Parent interest \n \n \n \n \n \n 114,370 \n \n \n 188,941 \n \n \n \n \n Total equity \n \n \n   \n \n \n 114,370 \n \n \n 188,941 \n \n \n \n \n   \n   \n   \n The above Consolidated Statement of Financial Position should be read in conjunction with accompanying Notes to the Financial Statements. \n   \n Consolidated statement of changes in equity \n For the period ended 30 June 2025               \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Share based \n \n \n Foreign \n \n \n   \n \n \n \n \n \n \n \n Issued \n \n \n Treasury \n \n \n Retained \n \n \n payments \n \n \n currency \n \n \n Total \n \n \n \n \n   \n \n \n capital \n \n \n shares \n \n \n earnings \n \n \n reserve \n \n \n translation \n \n \n equity \n \n \n \n \n Consolidated \n \n \n $'000 \n \n \n $'000 \n \n \n $'000 \n \n \n $'000 \n \n \n $'000 \n \n \n $'000 \n \n \n \n \n Balance at 1 July 2023 \n \n \n                               69,674 \n \n \n                                               - \n \n \n                                                112,753 \n \n \n                                    2,440 \n \n \n                                   (1,398) \n \n \n                                    183,469 \n \n \n \n \n Profit after income tax expense for the period \n \n \n - \n \n \n - \n \n \n 12,715 \n \n \n - \n \n \n - \n \n \n 12,715 \n \n \n \n \n Other comprehensive income for the period \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n 2,013 \n \n \n 2,013 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Total comprehensive income for the period \n \n \n - \n \n \n - \n \n \n 12,715 \n \n \n - \n \n \n 2,013 \n \n \n 14,728 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Equity Transactions: \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Share-based payments (note 28) \n \n \n                                         316 \n \n \n                                               - \n \n \n                                                            - \n \n \n                                       800 \n \n \n                                            - \n \n \n                                           1,116 \n \n \n \n \n Dividends paid (note 19) \n \n \n - \n \n \n - \n \n \n (4,976) \n \n \n - \n \n \n - \n \n \n (4,976) \n \n \n \n \n Treasury shares acquired (note 17) \n \n \n - \n \n \n (5,396) \n \n \n - \n \n \n - \n \n \n - \n \n \n (5,396) \n \n \n \n \n \n \n \n 316 \n \n \n (5,396) \n \n \n (4,976) \n \n \n 800 \n \n \n - \n \n \n (9,256) \n \n \n \n \n Balance at 30 June 2024 \n \n \n                               69,990 \n \n \n                                      (5,396) \n \n \n                                                120,492 \n \n \n                                    3,240 \n \n \n                                       615 \n \n \n                                    188,941 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Share based \n \n \n Foreign \n \n \n   \n \n \n \n \n \n \n \n Issued \n \n \n Treasury \n \n \n Retained \n \n \n payments \n \n \n currency \n \n \n Total \n \n \n \n \n   \n \n \n capital \n \n \n shares \n \n \n earnings \n \n \n reserve \n \n \n translation \n \n \n equity \n \n \n \n \n Consolidated \n \n \n $'000 \n \n \n $'000 \n \n \n $'000 \n \n \n $'000 \n \n \n $'000 \n \n \n $'000 \n \n \n \n \n Balance at 1 July 2024 \n \n \n                               69,990 \n \n \n                                      (5,396) \n \n \n                                                120,492 \n \n \n                                    3,240 \n \n \n                                       615 \n \n \n                                    188,941 \n \n \n \n \n Loss after income tax expense for the period \n \n \n - \n \n \n - \n \n \n (72,913) \n \n \n - \n \n \n - \n \n \n (72,913) \n \n \n \n \n Other comprehensive income for the period \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n 5,128 \n \n \n 5,128 \n \n \n \n \n Total comprehensive income for the period \n \n \n - \n \n \n - \n \n \n (72,913) \n \n \n - \n \n \n 5,128 \n \n \n (67,785) \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Equity Transactions: \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Share-based payments (note 28) \n \n \n                                         1,359 \n \n \n                                               - \n \n \n                                                            - \n \n \n                                    (146) \n \n \n                                            - \n \n \n                                        1,213 \n \n \n \n \n Dividends paid (note 19) \n \n \n - \n \n \n - \n \n \n (2,680) \n \n \n - \n \n \n - \n \n \n (2,680) \n \n \n \n \n Treasury shares acquired (note 17) \n \n \n - \n \n \n (4,458) \n \n \n - \n \n \n - \n \n \n - \n \n \n (4,458) \n \n \n \n \n Cancellation of treasury shares (note 17) \n \n \n (9,854) \n \n \n 9,854 \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n \n \n LSPs exercised and purchased by EBT (note 17) \n \n \n (860) \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (860) \n \n \n \n \n \n \n \n (9,356) \n \n \n - \n \n \n (2,680) \n \n \n (146) \n \n \n - \n \n \n (6,786) \n \n \n \n \n Balance at 30 June 2025 \n \n \n                               60,634 \n \n \n                                      - \n \n \n                                                44,899 \n \n \n                                    3,094 \n \n \n                                       5,744 \n \n \n                                    114,370 \n \n \n \n \n   \n   \n   \n The above Consolidated Statement of Changes in Equity should be read in conjunction with accompanying Notes to the Financial Statements. \n   \n   \n   \n Consolidated statement of cash flows \n For the period ended 30 June 2025 \n   \n \n \n \n \n \n \n \n \n \n \n Consolidated \n \n \n \n \n   \n \n \n \n \n \n 2025 \n \n \n 2024 \n \n \n \n \n   \n \n \n Note \n \n \n $'000 \n \n \n $'000 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cash flows from operating activities \n \n \n \n \n \n \n \n \n \n \n Proceeds from litigation contracts \n \n \n 64,702 \n \n \n 116,636 \n \n \n \n \n Payments for litigation contracts \n \n \n (128,166) \n \n \n (78,265) \n \n \n \n \n Payments to suppliers and employees \n \n \n (16,411) \n \n \n (16,337) \n \n \n \n \n Income tax paid \n \n \n \n \n \n (580) \n \n \n (2,830) \n \n \n \n \n Net cash from/(used in) operating activities \n \n \n \n \n \n (80,454) \n \n \n 19,203 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cash flows from investing activities \n \n \n \n \n \n \n \n \n \n \n Payments for property, plant and equipment \n \n \n (6) \n \n \n (31) \n \n \n \n \n Payments for intangibles \n \n \n (200) \n \n \n (9) \n \n \n \n \n Refund/(payment) of security deposits \n \n \n (2) \n \n \n 8 \n \n \n \n \n Net cash used in investing activities \n \n \n (207) \n \n \n (31) \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cash flows from financing activities \n \n \n \n \n \n \n \n \n \n \n \n \n \n Payments for treasury shares \n \n \n 17 \n \n \n (5,318) \n \n \n (5,396) \n \n \n \n \n Dividends paid \n \n \n 19 \n \n \n (2,680) \n \n \n (4,976) \n \n \n \n \n Proceeds from borrowings \n \n \n 15 \n \n \n 25,039 \n \n \n - \n \n \n \n \n Repayments of borrowings \n \n \n 15 \n \n \n (12,864) \n \n \n (8,139) \n \n \n \n \n Payments of finance costs \n \n \n (6,467) \n \n \n (8,960) \n \n \n \n \n Payments of placement fees related to third-party interests \n \n \n (1,033) \n \n \n (2,206) \n \n \n \n \n Contributions from third-party interests in consolidated entities \n \n \n 16 \n \n \n 67,106 \n \n \n 30,505 \n \n \n \n \n Distributions to third-party interests in consolidated entities \n \n \n 16 \n \n \n (33,959) \n \n \n (56,407) \n \n \n \n \n Net cash from/(used in) financing activities \n \n \n 29,824 \n \n \n (55,578) \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Net decrease in cash and cash equivalents \n \n \n (50,838) \n \n \n (36,405) \n \n \n \n \n Cash and cash equivalents at the beginning of the period \n \n \n 68,113 \n \n \n 104,457 \n \n \n \n \n Effects of exchange rate changes on cash and cash equivalents \n \n \n 1,171 \n \n \n 61 \n \n \n \n \n Cash and cash equivalents at the end of the period \n \n \n 9 \n \n \n 18,447 \n \n \n 68,113 \n \n \n \n \n   \n   \n The above Consolidated Statement of Cash Flows should be read in conjunction with accompanying Notes to the Financial Statements. \n   \n   \n Notes to the financial statements \n 30 June 2025 \n   \n Note 1. General information \n   \n The financial statements cover Litigation Capital Management Limited (the 'Company') as a Group consisting of Litigation Capital Management Limited and the entities it controlled at the end of, or during, the year (referred to as the 'Group'). The financial statements are presented in Australian dollars, which is Litigation Capital Management Limited's functional and presentation currency. \n   \n Litigation Capital Management Limited was admitted onto the Alternative Investment Market ('AIM') on 19 December 2018. \n   \n Litigation Capital Management Limited is a for profit publicly listed company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is: \n   \n Level 12, The Chifley Tower \n 2 Chifley Square \n Sydney NSW 2000 \n   \n A description of the nature of the Group's operations and its principal activities are included in the Directors' report, which is not part of the financial statements. \n   \n The financial statements were authorised for issue, in accordance with a resolution of Directors, on 1 October 2025. The Directors have the power to amend and reissue the financial statements. \n   \n Basis of preparation \n The Financial Report: \n   \n · is a general purpose financial report; \n · has been prepared in accordance with the Australian Accounting Standards adopted by the Australian Accounting Standards Board (AASB) and International Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards Board (IASB); \n · has been prepared in accordance with the requirements of the Corporations Act 2001 (Cth); \n · is presented in Australian dollars, which is the Group's functional and presentation currency, with all values rounded to the nearest thousand dollars, or in certain cases to the nearest dollar, in accordance with ASIC Corporations Instrument 2016/191 unless otherwise indicated; \n · includes foreign currency transactions that are translated into the functional currency, using the exchange rates prevailing at the date of the Financial Report; \n · has been prepared on a going concern basis using a historical cost basis, except for certain assets and liabilities measured at fair value; \n · presents assets and liabilities on the face of the Balance Sheets in decreasing order of liquidity; \n · where required, presents restated comparative information for consistency with the current year's presentation in the Financial Report; and \n · contains accounting policies that have been consistently applied to all periods presented, unless otherwise stated. \n   \n Principles of consolidation \n The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Litigation Capital Management Limited ('Company' or 'parent entity') as at 30 June 2025 and the results of all subsidiaries for the year then ended. Litigation Capital Management Limited and its subsidiaries together are referred to in these financial statements as the 'Group'. \n   \n The Group includes fund investment vehicles over which the Group has the right to direct the relevant activities of the fund under contractual arrangements and has exposure to variable returns from the fund investment vehicles. See note 4. \n   \n Subsidiaries are all those entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. \n   \n Intercompany transactions, balances and unrealised gains on transactions between entities in the Group are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. \n   \n Note 2. Material accounting policies \n   \n Accounting standards and interpretations \n The accounting policies adopted are consistent with those followed in the preparation of the Group's annual consolidated financial statements for the year ended 30 June 2024. \n   \n New and amended accounting standards and interpretations issued but not yet effective \n The new and amended standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Group's financial statements that the Group reasonably expects will have an impact on its disclosures, financial position or performance when applied at a future date, are disclosed below. \n   \n • Amendment to IFRS 9 and IFRS 7 - Classification and Measurement of Financial Instruments \n • IFRS 18 Presentation and Disclosure in Financial Statements \n • IFRS 19 Subsidiaries without Public Accountability: Disclosures \n • IFRS S1, General requirements for disclosure of sustainability-related financial information \n • IFRS S2 Climate-related disclosures \n   \n The Group intends to adopt these new and amended standards and interpretations, if applicable, when they become effective. The Group has not listed other standards and interpretations which are issued but not yet effective, as they are not expected to impact the Group. \n   \n Going concern \n Litigation Capital Management Limited and its wholly owned subsidiaries (\"LCM\") and the Group's fund structures (\"Fund\") have prepared the financial statements on the going concern basis, which contemplates continuity of normal business activities and the realisation of assets and discharge of liabilities in the normal course of business. \n   \n Given the number of adverse case outcomes in recent months, which have impacted cash inflows and increased indebtedness, the Directors have considered a range of scenarios, including plausible downside scenarios, and note that in certain circumstances, further case losses could lead to a breach of LCM's debt covenants. \n   \n While LCM's lender has been responsive in providing near-term covenant waivers to date, any further amendments, should they be required, will be subject to negotiation. This assessment is linked to a robust evaluation of the principal risks facing LCM and the potential impact of these risks being realised. \n   \n After considering LCM's forecasts, stress testing and available mitigating actions, and having regard to the inherent risks associated with the binary nature of LCM's investment model, the Directors have concluded that a material uncertainty exists which may cast significant doubt on LCM's ability to continue as a going concern. \n   \n The material uncertainty relates to LCM's ability to comply with its debt covenants in the event of certain adverse case outcomes. The Directors have a reasonable expectation, based on current discussions, that LCM will continue to receive the necessary support from its lender to allow it to continue in operational existence for the foreseeable future. Accordingly, the financial statements have been prepared on a going concern basis, whilst noting the material uncertainty above. \n   \n However, these events and conditions indicate that a material uncertainty exists which may cast significant doubt on LCM's ability to continue as a going concern, and therefore the entity may be unable to realise its assets and discharge its liabilities in the normal course of business and at the amounts stated in the financial report. The financial report does not include any adjustments relating to the amounts or classification of recorded assets or liabilities that might be necessary if LCM does not continue as a going concern. \n   \n Operating segments \n Operating segments are presented using the 'management approach', where the information presented is on the same basis as the internal reports provided to the Chief Operating Decision Makers ('CODM'). The CODM is responsible for the allocation of resources to operating segments and assessing their performance. \n   \n Foreign currency translation \n The financial statements are presented in Australian dollars, which is Litigation Capital Management Limited's functional and presentation currency. \n                                                                                 \n Foreign currency transactions \n Foreign currency transactions are translated into the entity's functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. \n                                 \n Foreign operations                                                                                                                                                              \n The assets and liabilities of foreign operations are translated into Australian dollars using the exchange rates at the reporting date. The revenues and expenses of foreign operations are translated into Australian dollars using the average exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences are recognised in other comprehensive income through the foreign currency reserve in equity. \n   \n The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed of. \n   \n Fair value measurement \n The Group measures its financial instruments such as litigation funding agreements and financial liabilities related to third-party interests at fair value at each balance sheet date. \n   \n When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes, the fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; and assumes that the transaction will take place either: in the principal market; or in the absence of a principal market, in the most advantageous market. \n   \n Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming they act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, are used, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. \n   \n The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data is available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. \n   \n All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole: \n   \n \n \n \n \n · \n \n \n Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities \n \n \n \n \n · \n \n \n Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable \n \n \n \n \n · \n \n \n Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable \n \n \n \n \n   \n For assets and liabilities that are recognised in the financial statements at fair value on a recurring basis,  the Group determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.   \n The Group's Executive Leadership Committee determines the policies and procedures for fair value measurement, including the litigation funding agreements. The Committee is comprised of the Chief Executive Officer, Chief Financial Officer and Head of Investments or equivalent. \n   \n The level of involvement of external valuers or specialist valuation experts is determined annually by the Committee after discussion with and approval by the Company's Audit Committee. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained. \n   \n At each reporting date, the Committee analyses the movements in the values of assets and liabilities which are required to be remeasured or re-assessed as per the Group's accounting policies. For this analysis, the Committee verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents. \n   \n Fair-value related disclosures for financial instruments and non-financial assets that are measured at fair value or where fair values are disclosed, are summarised in the following notes: \n   \n \n \n \n \n · \n \n \n Disclosures for valuation methods, significant estimates and assumptions Note 21 \n \n \n \n \n · \n \n \n Quantitative disclosures of fair value measurement hierarchy Note 21 \n \n \n \n \n · \n \n \n Financial instruments  Note 20 \n \n \n \n \n   \n Litigation service                                                                                                                                                               \n Revenue is recognised at the amount the Group expects to be entitled to in exchange for its services. For each customer contract, the Group identifies the performance obligations, determines the transaction price (including any variable consideration), and recognises revenue when the performance obligation is satisfied. \n   \n Variable consideration reflects the uncertainty of outcomes in awards, settlements or other contingent events. It is estimated using either the \"expected value\" or \"most likely amount\" method and recognised only when it is highly probable that a significant reversal will not occur. Until the uncertainty is resolved, amounts received that are subject to this constraint are recorded as refund liabilities. \n   \n The performance of a litigation service contract by the Group entails the management and progression of the litigation project during which costs are incurred by the Group over the life of the litigation project. As consideration for providing litigation management services and financing of litigation projects, the Group receives either a percentage of the gross proceeds of any award or settlement of the litigation, or a multiple of capital deployed, and is reimbursed for all invested capital. \n   \n Revenue, which includes amounts in excess of costs incurred and the reimbursement for all invested capital, is not recognised as revenue until the successful completion of the litigation project ie, complete satisfaction of the performance obligation, which is generally at the point in time when a judgment has been awarded or on an agreed settlement between the parties to the litigation, and therefore when the outcome is considered highly probable. On this basis, revenue is not recognised over time and instead recognised at the point in time when the Group satisfies the performance obligation. Costs include only external costs of funding the litigation, such as solicitors' fees, counsels' fees and experts' fees. \n   \n The terms and duration of each settlement or judgment varies by litigation project. Payment terms are not defined by the Group's litigation contracts however upon successful completion of a litigation project, being the satisfaction of the single performance obligation, funds are generally paid into trust within 28 days. The funds will remain in trust until the distribution amounts have been determined and agreed by the relevant parties, after which payment will be received by the Group. \n   \n Income tax \n The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to temporary differences, unused tax losses and the adjustment recognised for prior periods, where applicable. \n   \n Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for: \n \n \n \n \n · \n \n \n When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor taxable profits; or \n \n \n \n \n · \n \n \n When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and the timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future. \n \n \n \n \n                 \n Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. \n   \n The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable that there are future taxable profits available to recover the asset. \n   \n Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on either the same taxable entity or different taxable entities which intend to settle simultaneously. \n   \n Litigation Capital Management Limited (the 'head entity') and its wholly-owned Australian subsidiaries have formed an income tax consolidated group under the tax consolidation regime. The head entity and each subsidiary in the tax consolidated group continue to account for their own current and deferred tax amounts. The tax consolidated group has applied the 'separate taxpayer within group' approach in determining the appropriate amount of taxes to allocate to members of the tax consolidated group. \n   \n In addition to its own current and deferred tax amounts, the head entity also recognises the current tax liabilities (or assets) and the deferred tax assets arising from unused tax losses and unused tax credits assumed from each subsidiary in the tax consolidated group. \n   \n Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as amounts receivable from or payable to other entities in the tax consolidated group. The tax funding arrangement ensures that the intercompany charge equals the current tax liability or benefit of each tax consolidated group member, resulting in neither a contribution by the head entity to the subsidiaries nor a distribution by the subsidiaries to the head entity. \n   \n Cash and cash equivalents \n Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. \n   \n Trade and other receivables \n Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables generally do not have a specifically defined time frame for settlement, additionally, when the receivable is due from part of the portfolio of litigation projects, the settlement of the receivable is generally made upon an additional resolution of another litigation project within the portfolio which also may not be within a specifically defined time frame. \n   \n The Group has applied the simplified approach to measuring expected credit losses for trade receivables and contract assets, which uses a lifetime expected loss allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue. \n   \n Due from resolution of investments \n Amounts due from the settlement of financial assets relate to the realisation of litigation funding assets that have been successfully concluded and where there is no longer any litigation risk remaining and represent the expected cash flow to be received by the Group. The settlement terms and timing of realisations vary by litigation funding asset. The majority of settlement balances are received shortly after the period end in which the litigation funding asset has concluded, and all settlement balances are generally expected to be received within 12 months after completion. \n   \n Contract costs \n Contract costs are recognised as an asset when the Group incurs costs in fulfilling a contract and when all the following are met: (i) the costs relate directly to the contract; (ii) the costs generate or enhance resources of the Group that will be used to satisfy future performance obligations; and (iii) the costs are expected to be recovered. Contract costs are financial assets for impairment purposes. The Group's revenue recognition policy for litigation service revenue provides further information. \n   \n Investments \n Investments are financial assets recognised at fair value through profit or loss and are fair valued using an income approach. Financial assets at fair value through profit or loss are carried in the statement of financial position at fair value with net changes in fair value recognised in the statement of profit or loss.  This category includes the Group's litigation funding assets. The litigation funding assets are primarily derecognised when the underlying litigation resolves and transfers to Due from resolution of financial assets. \n   \n Financial assets are derecognised when the contractual rights to the cash flows expire or when the asset, along with the associated risks and rewards of ownership, are substantially transferred to another entity. \n   \n Financial liabilities related to third-party interests in consolidated entities \n Non-controlling interests where the Group does not own 100% of a consolidated entity are recorded as financial liabilities related to third-party interests in consolidated entities. Financial liabilities related to third-party interests in consolidated entities are initially recognised at the fair value. Gains or losses on liabilities held at fair value through profit or loss are recognised in the statement of profit or loss as 'Movement in financial liabilities related to third-party interests in consolidated entities'. They are subsequently measured at fair value using an income approach. Amounts included in the consolidated statement of financial position represent the net asset value of the third-parties' interests. These amounts have been elected to be measured at fair value to reduce the accounting mismatch between the related financial asset measured at fair value through profit or loss. \n   \n Financial liabilities are derecognised when the obligation to settle through cash flows has expired or been transferred. \n   \n Impairment of non-financial assets \n Non-financial assets are reviewed for impairment at each reporting date and whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. \n   \n Recoverable amount is the higher of an asset's fair value less costs of disposal and value-in-use. The value-in-use is the present value of the estimated future cash flows relating to the asset using a pre-tax discount rate specific to the asset or cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to form a cash-generating unit. \n   \n Trade and other payables \n These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year and which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition. \n   \n Borrowings \n Borrowings are initially recognised at fair value net of transaction costs incurred. Subsequent to initial recognition, borrowings are stated at amortised cost. \n   \n Net finance costs \n Net finance costs comprise interest income from the investment of excess funds in short-term, highly liquid investments, and interest expense and borrowing costs related to the borrowing of funds. \n   \n Employee benefits \n   \n Short-term employee benefits \n Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities are settled. \n   \n Other long-term employee benefits \n The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are measured at the present value of expected future payments to be made in respect of services provided by employees up to the reporting date. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on high quality corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows. \n   \n Superannuation expense \n Contributions to superannuation are expensed in the period in which they are incurred. \n   \n Share-based payments \n Equity-settled share-based compensation benefits are provided to employees. \n   \n Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the rendering of services. \n   \n The cost of equity-settled transactions are measured at fair value on grant date. Fair value is determined using either the Monte Carlo or Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine whether the Group receives the services that entitle the employees to receive payment. No account is taken of any other vesting conditions. \n   \n The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous periods. \n   \n Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are satisfied. \n   \n If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of the share-based compensation benefit as at the date of modification. \n   \n If the non-vesting condition is within the control of the Group or employee, the failure to satisfy the condition is treated as a cancellation. If the condition is not within the control of the Group or employee and is not satisfied during the vesting period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited. \n   \n If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award may be treated as if they were a modification, depending on the specific circumstances of the award. \n   \n Issued capital \n Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. \n   \n Treasury shares \n Where Group purchase shares in the listed Company, the consideration paid is deducted from issued capital and the shares are treated as treasury shares until they are subsequently sold, reissued or cancelled. Where such shares are sold or reissued, any consideration received is included in shareholders' equity. \n   \n Dividends \n Dividends are recognised when declared during the financial year and no longer at the discretion of the Company. \n   \n Earnings per share \n                                                                                                                                                                 \n Basic earnings per share                                                                                                                                        &nb...

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