Full Year 2024 Results

About this update from Pollen Street Group Limited

[{"type":"text","content":"\n \n 25 March 2025 \n   \n Pollen Street Group Limited: Full Year 2024 Results \n   \n   \n Pollen Street Group Limited (\"Pollen Street\") today announces the publication of its Annual Report and Accounts for the year ended 31 December 2024. \n   \n 2024 has been a pivotal year for Pollen Street with strong financial performance and strategic progress marked by growing Asset Management revenue and profits together with consistent Investment Company returns. Assets under Management (\"AuM\") increased 29%, with healthy growth across both private equity and private credit strategies. Pollen Street has entered 2025 with strong momentum and, with continued focus on its core specialisms, it looks forward to continued growth towards its medium-term target of £10 billion total AuM. \n   \n \n \n \n \n AUM (£bn) \n \n \n 2024 \n \n \n 2023 \n \n \n YoY Growth (%) \n \n \n \n \n Total AuM \n \n \n 5.4 \n \n \n 4.2 \n \n \n 29% \n \n \n \n \n Fee Paying AuM \n \n \n 4.0 \n \n \n 3.4 \n \n \n 17% \n \n \n \n \n   \n \n \n \n \n INCOME STATEMENT (£m) \n \n \n 2024 \n \n \n 2023 \n \n \n YoY Growth (%) \n \n \n \n \n Fund Management Income \n \n \n 66.8 \n \n \n 49.2 \n \n \n 36% \n \n \n \n \n Fund Management Administration Costs \n \n \n (41.1) \n \n \n (34.3) \n \n \n 20% \n \n \n \n \n Fund Management EBITDA \n \n \n 25.7 \n \n \n 14.9 \n \n \n 72% \n \n \n \n \n Income on Net Investment Assets \n \n \n 31.8 \n \n \n 30.2 \n \n \n 5% \n \n \n \n \n EBITDA \n \n \n 57.5 \n \n \n 45.1 \n \n \n 27% \n \n \n \n \n Profit After Tax \n \n \n 49.6 \n \n \n 39.9 \n \n \n 24% \n \n \n \n \n EPS \n \n \n 78.8p \n \n \n 62.2p \n \n \n \n \n \n \n \n DPS \n \n \n 53.6p \n \n \n 61.0p \n \n \n \n \n \n \n \n   \n   \n Financial Highlights for 2024 \n   \n ·      Total AuM increased to £5.4 billion (2023: £4.2 billion), driven by the success of Private Equity Fund V and Private Credit Fund IV \n o  Private Equity Fund V AuM has surpassed the initial target of €1 billion \n o  Private Credit Fund IV AuM on track to achieve £1 billion target during 2025 \n ·      Total Fee-Paying AuM increased to £4.0 billion (2023: £3.4 billion) \n ·      £1.1 billion invested in Private Equity and £0.6 billion in Private Credit in the year \n ·      Fund Management Income grew 36% to £66.8 million (2023: £49.2 million) \n ·      Fund management EBITDA increased to £25.7 million (2023: £14.9 million) accounting for 45% of Group EBITDA (2023: 33%) made up of Fee-Related Earnings of £21.7 million and Performance-Related Earnings of £4.0 million \n ·      The Investment Company maintained its consistent track record with Income on Net Investment Assets increasing to £31.8 million (2023: £30.2 million), representing a return of 9.6% (2023: 8.8%)   \n ·      Operating profit increased to £58.2 million (2023: £44.5 million) \n ·      Second (and final) interim dividend of 27.1p brings dividends declared in respect of 2024 to £33.0 million (2023: £32.1 million) in line with previous guidance \n \n 2025 Outlook \n   \n As Pollen Street looks ahead to 2025, the group has confidence in its strategic direction and ability to capitalise on the attractive opportunities ahead. The growth prospects for private markets remain strong and Pollen Street is confident in meeting its medium-term goal of Total AuM of £10 billion. \n   \n Key priorities for 2025 include: \n   \n ·      Complete fundraising of Private Equity Fund V with final close ahead of target \n ·      Complete fundraising of Private Credit Fund IV, targeting £1 billion and maintain deployment \n ·      Expand AuM towards our medium term target of £10bn \n ·      Maintain a progressive dividend policy while strategically deploying capital for shareholder value \n ·      Return surplus capital to shareholders through share buybacks, subject to relative attractiveness compared to other value-creation opportunities \n   \n Lindsey McMurray, Chief Executive Officer, said: \"We are proud of the continued progress that Pollen Street has achieved in the last year. Our AuM increased in both Private Equity and Private Credit, reflecting our investors' confidence in our strategies. Private Equity Fund V surpassed its €1 billion target and the Private Credit strategy and team are increasingly recognised as a clear leader in their field. 2025 has started well with continued fundraising momentum, solid asset performance and a promising pipeline of deployment opportunities. Looking ahead, we are strategically positioned to capture future growth with our specialist focus, diversified investor base and long track record of performance setting us apart.\" \n   \n Results presentation: \n   \n Pollen Street Group Limited will host its results presentation for Full Year 2024 Results at 9 AM; 25 March 2025 \n   \n Register for the webinar: https://pollencap.zoom.us/webinar/register/WN_aWLlvKP_RhS9RW6hAmWYog \n   \n The full results presentation is available on the group's website www.pollenstreetgroup.com . \n   \n About Pollen Street \n   \n Pollen Street is an alternative asset manager dedicated to investing within the financial and business services sectors across both Private Equity and Private Credit strategies. The business was founded in 2013 and has consistently delivered top tier returns alongside growing AuM. \n   \n Pollen Street benefits from a complementary set of asset management activities focused on managing third-party AuM (the \"Asset Manager\") together with on-balance sheet investments (the \"Investment Company\"). \n   \n The Asset Manager raises capital from high quality investors and deploys it into its Private Equity and Private Credit strategies. The strong recurring revenues from this business enable delivery of scalable growth. \n   \n The Investment Company invests in the strategies of the group delivering attractive risk adjusted returns and accelerating growth in third-party AuM of the Asset Manager through investing in Pollen Street funds, taking advantage of attractive investment opportunities and aligning interest with our investors to grow AuM. Today the portfolio is largely invested in credit assets with the allocation to Private Equity expected to increase to 30 per cent in the long term. The portfolio consists of both direct investments and investments in funds managed by Pollen Street. \n   \n POLN is listed on the London Stock Exchange (ticker symbol: POLN) and is a member of the FTSE 250 index. Further details are available at www.pollenstreetgroup.com . \n   \n For further information about this announcement please contact: \n   \n Pollen Street - Corporate Development Director \n Shweta Chugh \n +44 (0)20 3965 5081 \n   \n Barclays Bank plc - Joint Broker \n Neal West / Stuart Muress \n +44 (0)20 7623 2323 \n   \n Investec Bank plc - Joint Broker \n Ben Griffiths / Kamalini Hull \n +44 (0)20 7597 4000 \n   \n FGS Global \n Chris Sibbald / Anna Tabor \n [email protected] \n   \n MUFG Corporate Governance Limited \n Company Secretary \n [email protected] \n   \n   \n Annual Report and Accounts \n   \n The Annual Report and Accounts are available to view and download from the Company's website https://ir.pollenstreetgroup.com/investors/financial-information/ . Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into or forms part of this announcement. The information set out below does not constitute the Company's statutory accounts for the year ended 31 December 2024 but is derived from those accounts. Statutory accounts for the year ended 31 December 2024 will be delivered to the Registrar of Companies in due course. The group's auditors have reported on those accounts: their report was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under 'Section 263 (2) or (3) of The Companies (Guernsey) Law, 2008. The following text are selected extracts from the Annual Report and Accounts. \n   \n A copy of the Annual Report will shortly be submitted to the National Storage Mechanism and will be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism \n   \n   \n \n \n \n Chair's Statement \n Robert Sharpe \n Chair \n As Chairman of Pollen Street Group Limited, I am pleased to report on another year of significant progress and accomplishment in 2024. The Group has delivered strong performance across all key metrics while advancing our strategic objectives. \n A Pivotal Year of Exceptional Delivery \n Our 2024 performance reflects the successful execution of our strategy with consistent delivery of strong returns through a clear and repeatable investment strategy and achievement of successful fundraises across both Private Equity and Private Credit. By attracting new investors and deepening relationships with existing investors, we have grown total AuM to £5.4 billion in December 2024, a 29 per cent increase from £4.2 billion at the end of 2023. \n In 2024, we increased AuM across both Private Equity and Private Credit. Private Equity AuM grew to £3.5 billion - a 32 per cent increase on prior year driven by strong investor support for Private Equity Fund V as well as co-investment offered to our Limited Partners (\"LPs\"). Private Credit AuM grew to £1.9 billion - a 24 per cent increase, with capital raised in Private Credit Fund IV and associated separately managed accounts. The Investment Company maintained its track record of stable and predictable returns, with income on Net Investment Assets growing to £31.8 million (2023: £30.2 million), representing a return on Net Investment Assets of 9.6 per cent (2023: 8.8 per cent) for the year ended 31 December 2024. This growth enabled the Group to return £48 million to shareholders through dividends and share buybacks during the year. \n The private capital sector continues to benefit from favourable macro tailwinds, including increasing institutional allocation to private markets and sustained demand especially in the mid-market. We expect further acceleration in this trend, which as a focused financial and business services specialist with a proven investment strategy, we are well-positioned to capitalise on. \n Our financial performance has been robust, with Operating Profit showing substantial growth underpinned by strong AuM growth and operational leverage. The Investment Company continues to be a key asset, driving third party AuM growth while maintaining robust income generation and growing capital invested through Pollen Street managed funds. \n Capital Allocation Framework & Buyback Programme \n Reflecting our strategic and operational development, and following its conversion from an investment trust to a commercial company, the Group put in place an enhanced capital allocation framework in March 2024. This framework prioritises strategic growth in our funds and other organic growth opportunities, while also providing confidence in additional cash returns to shareholders which were value accretive. Through 2024, we have demonstrated disciplined adherence to the framework. \n We have committed £196 million to Pollen Street funds as well as making cash returns to shareholders of £48 million. The Board has declared a second interim dividend of 27.1 pence per share, bringing the total dividend for the year to 53.6 pence per share or £33 million. \n Corporate Governance and ESG Reporting \n The implementation of the final stages of the reorganisation of the Group following the combination of Pollen Street Capital Holdings Limited with Pollen Street Limited (formerly Honeycomb Investment Trust Plc) was a key focus for the start of the year. This included the transition from an Investment Trust to a Commercial Company. \n Strong governance is core to how we are building better, more sustainable businesses. Through our systematic data-driven approach to environmental, social, and governance (\"ESG\"), we've helped portfolio companies and borrowers develop robust policies and procedures, supporting sustainable growth and operational excellence, as well as driving progress in the social and environmental spheres. The expansion of ESG margin ratchets from 8 to 16 credit facilities demonstrates Pollen Street's commitment to incentivising positive change. \n The Group continues to strengthen its approach to reporting and climate risk management, ensuring transparency and accountability across its investments, considering the evolving ESG regulatory environment. \n As I noted in the Annual General Meeting in June 2024, I have now reached my nine-year tenure as a Director of the Group. A search is underway for a new Chair with several strong candidates identified and interviewed. Once the new Chair has been identified the intention is for there to be a period of three months handover to ensure a smooth transition. \n I am pleased to welcome Crispin Goldsmith who joined the leadership team as Chief Financial Officer (\"CFO\") in January 2025. Crispin's experience across both private and public markets brings a unique blend of skills to our financial leadership. \n Looking Forward \n Outlook: Pollen Street's Growth Trajectory \n The last year has been pivotal for the Pollen Street Group, characterised by substantial AuM growth, supported by the success of Private Equity Fund V and Private Credit Fund IV. Our fundraising achievements have affirmed our competitive edge and specialised strategic focus, and our recent inclusion in the FTSE 250 in January 2025 was a significant corporate milestone. \n As we progress through 2025, whilst mindful of an increasingly uncertain global environment, our outlook remains positive. The private markets landscape continues to present growth opportunities, with our specialist focus positioning us strongly. We are actively expanding our investor relationships, further driving AuM growth, while maintaining strong Investment Company returns, notwithstanding any share buyback activities. \n The Board and I extend our gratitude to the entire Pollen Street team for their exceptional execution. We look forward to delivering further success in 2025, thanks to the continued support of our limited partner investors, shareholders and employees. \n   \n Robert Sharpe \n Chair \n 24 March 2025 \n \n \n CEO Report \n Lindsey McMurray \n Chief Executive Officer \n I am pleased to report another year of strong performance for Pollen Street, marked by exceptional investment and fundraising execution and strategic growth. Our AuM saw a significant increase, across both Private Equity and Private Credit strategies demonstrating the strength and resilience of the business. Private Equity AuM growth was driven by the success of our Private Equity Fund V as well as strong co-investment initiatives. Private Equity V has surpassed its target of €1 billion with further capital commitments anticipated in 2025. Similarly, Private Credit experienced a strong year of fundraising and deployment. This is continuing well during 2025. Our focus on financial and business services, coupled with our long track record of performance, continues to set us apart in the competitive alternative asset management landscape. \n Delivering Strong Performance \n This year's success is reflected in strong growth of fund management revenue and earnings. The Group's Operating Profit grew to £58.2 million for 2024, up from £44.5 million in 2023. The primary growth driver was our Asset Manager, with Operating Profit increasing to £27.2 million (47 per cent of Group), from £15.9 million (36 per cent of Group) in 2023. This growth underscores our robust operational framework, well-invested platform and strategic market positioning. It highlights the operational leverage inherent in our business model, allowing us to scale revenues while maintaining costs efficiently. \n Well-Positioned Strategy \n Our investment strategies, leveraging both Private Equity and Private Credit capabilities, have proven resilient in the current turbulent market environment. Our ability to deliver consistent, high-quality returns, within an attractive risk framework, positions us strongly for sustainable, long-term growth. The strength of our balance sheet remains a crucial differentiator and enables us to align ourselves with our LPs. With £196 million in General Partner (\"GP\") commitments to Pollen Street managed funds, we are well positioned to attract new investors, deepen existing relationships and pursue selective inorganic growth opportunities. \n ASSET MANAGER \n Private Equity \n Our Private Equity strategy focuses on backing mid-market companies in the financial and business services sector, typically taking majority stakes in European-headquartered businesses. We partner with talented leadership teams, often founder-led, to accelerate growth by applying deep sector expertise and a proven operational framework. \n Our approach, which has been refined and tested through multiple market cycles, targets companies with an excellent customer proposition that are well positioned to take advantage of opportunities as the industry continues to undergo structural changes. This strength has persisted well in 2024 and 2025 through macro-economic and political volatility. The Financial Services sector, our core specialism, continues to experience change and disruption through technology transformation and adoption, industry consolidation and evolving regulatory oversight. We remain strategically well placed to navigate and capitalise on opportunities. \n Private Credit \n Our Private Credit strategy focuses on providing predominantly senior secured, asset-based lending to mid-market companies across Europe. We target non-bank lenders, leasing businesses, technology companies, and other entities with diverse portfolios of financial or hard assets. This approach allows us to fill the funding gap created by the retrenchment of banks from lending markets following the global financial crisis, a trend that has continued to accelerate in recent years. \n Through 2024, the private credit market continued to provide strong conditions for growth with higher interest rates and ongoing borrowing demand from the SME community. Our reliable and consistent approach and growing reputation has ensured that we remain an attractive destination for borrowers and that we continue to deliver returns uncorrelated to other private credit strategies. \n Fundraising and Deployment \n Total AuM was at £5.4 billion as of 31 December 2024, up 29 per cent from £4.2 billion at the end of 2023. Our journey over the last year has been marked by significant milestones, particularly in our fundraising for Private Equity Fund V, which now has €1.1 billion in commitments, exceeding our €1 billion target. Given strong investor appetite, we are continuing fundraising into 2025 with the final close now expected in mid-2025. Along with Private Equity Fund V, we have raised over £400 million of funds in Co-Invest vehicles. Whilst these are non-fee-paying, this further supports the development of long-term strategic relationships with our investors. In Private Credit, we raised over £500 million in Credit funds in 2024, completing the first close of Private Credit Fund IV and a new UK Separate Managed Account (\"SMA\"). Fundraising for Private Credit Fund IV has strong momentum and is on track to meet the target of £1 billion in 2025. At December 2024, we had in excess of £500 million of available capital in our Credit funds which will convert to fee-paying AuM once deployed. \n 2024 was also a strong year for deployment. We invested £1.1 billion in Private Equity and £0.6 billion in Private Credit. We have a rich pipeline of opportunities in both strategies and look forward to another strong year for deployments in 2025. \n Client Base \n The strength of our investor relationships has been central to our fundraising progress. Our LP investor base continues to be the cornerstone of our success. We have nurtured strong relationships with existing investors while expanding our geographical reach. Many of our new investors are the result of several years of dedicated relationship building. \n The fundraise during the year across the strategies has been instrumental in deepening our penetration into the deep capital pools in Europe, North America and the Middle East. Our strategic approach has diversified our investor base, tapping into new markets and reflecting the investments we have made in business development capabilities within the team. As we move forward, we remain dedicated to nurturing these relationships with continued outstanding performance to ensure that Pollen Street is strategically positioned for sustained long-term growth. \n INVESTMENT COMPANY \n Our balance sheet continues to be a highly valuable strategic asset enabling the acceleration of Third-Party AuM growth as we demonstrate strong alignment with our LPs. The ability for the manager to make significant GP commitments, c.2 - 5 per cent in Private Equity Funds and 7 - 10 per cent in Private Credit Funds, supports in attracting new investors and in growing relationships with existing ones. \n The Investment Company has committed £196 million to Pollen Street managed funds, with 66 per cent drawn (2023: 29 per cent). As of the end of 2024, the balance sheet allocation was 91 per cent Private Credit and 9 per cent Private Equity. Our balance sheet investments have performed well, delivering robust Investment Company returns and, notwithstanding share buybacks of £23 million on top of dividends paid of £25 million, the Investment Company delivered strong income generation of £31.8 million. \n Success Indicators \n I am delighted to report that we have excelled across all the success indicators outlined in our half-year 2024 results presentation. \n ·      AuM Growth - Total AuM increased by 29 per cent to £5.4 billion, Fee-Paying AuM grew by 17 per cent to £4.0 billion at 31 December 2024 and has further increased to £4.3 billion during Q1 2025. Further growth in Fee-Paying AuM is expected throughout 2025. \n ·      High Quality Income and Margin Expansion - Sustained addition of contractual and recurring income and embedded fees across both strategies. \n ·      Investment Returns - Strong and consistent track record. \n ·     Operational Efficiency - Significant improvement in efficiency, Fund Management EBITDA Margin increasing from 30 per cent as at the end of 2023 to 39 per cent. \n ·   Investor Base Expansion - Strengthened our LP base, and expanded penetration into deep and sophisticated markets. \n OUTLOOK FOR 2025 \n As we look further into 2025, I am confident in our strategic direction and our ability to capitalise on the opportunities ahead. Our focus remains on delivering exceptional returns to our investors and shareholders with our key priorities for 2025: \n ·      Complete fundraising of Private Equity Fund V to final close ahead of target \n ·      Complete fundraising of Private Credit Fund IV, targeting £1 billion and maintain deployment \n ·      Expand AuM towards our medium term target of £10 billion \n ·      Maintain our progressive dividend policy while strategically deploying capital for shareholder value \n ·      Return surplus capital to shareholders through share buybacks, subject to relative attractiveness compared to other value-creation opportunities \n The medium-term growth prospects for private markets remain strong, and we are confident in our long-term goal of reaching a Total AuM of £10 billion, notwithstanding an increasingly uncertain global landscape. \n In closing, I would like to extend my gratitude to our amazing team whose hard work and commitment have been instrumental in achieving these results. I also want to thank our limited partners, shareholders and wider group of counterparties for their continued trust and support. \n I would specifically like to thank Robert Sharpe, our Chairman, who will be retiring from the Board this year. Robert has been an exceptional leader of the Board and the Group as it has transitioned from an investment trust to our current business. He leaves us with a very strong strategic position and we are extremely grateful. \n Lindsey McMurray \n Chief Executive Officer \n 24 March 2025 \n \n \n Private Equity Strategy \n Michael England \n Partner \n This section gives insight into our Private Equity strategy. The Group earns management fees and carried interest from managing and advising funds investing in this strategy. \n Our Private Equity strategy focuses on backing mid-market companies in the financial and business services sector. We look to take majority stakes in businesses headquartered in Europe. We back talented and driven leadership teams and we seek to accelerate their growth by applying deep sector knowledge and a proven operational framework to build businesses with the potential to deliver top-tier returns. \n We invest aligned with structural growth trends which form the basis of our investment themes, from the consolidation of distribution to the wide-ranging impact of middle and back-office automation that is shaping the entire sector. We pinpoint these drivers of change and align our investment strategy to support businesses at the forefront of these opportunities, that are well positioned to win share in their relevant markets. \n Our strategy has been in place for 19 years and has been tested through multiple market events and cycles. Throughout this period, we have grown the strategy through a consistent track record of delivering top-tier returns based upon a robust and disciplined approach to investing, bringing to bear our specialist knowledge and best practice. \n How it Works: Clear Opportunity Set and Established Investment Strategy \n Our investment strategy is dedicated to buying and building great businesses serving the financial ecosystem across five key sub-sectors: \n ·      Payments; \n ·      Wealth; \n ·      Insurance; \n ·      Technology-enabled services; and \n ·      Lending. \n Through thematic origination, deep sector knowledge and the Pollen Street network, our investment team curates a rich pipeline of businesses. Within these investment theses, we seek to back inspirational leadership teams who have the passion and discipline to deliver strong growth safely. We drive growth through our proven operational framework, which is built upon four key pillars: \n ·      Technology innovation and digital transformation; \n ·      Buy, build and consolidation; \n ·      Globalisation and product development; and \n ·      Embedding responsible investing principles. \n 2024 - A Platform for Continued Growth \n During the year, we have delivered consistently strong performance across our Private Equity funds, with impressive revenue and EBITDA growth, steady deployment activity into attractive platforms and clear progress on exits. \n Pollen Street welcomed three new platform deals: \n ·      Etops: a consolidator in the European asset and wealth management technology sector \n ·      Keylane: Leading European SaaS provider to insurers and pension administrators \n ·      Mattioli Woods: UK wealth manager with £20bn of client assets from over 23,000 clients \n This is supported by the completion of 22 bolt-ons to accelerate the growth of existing portfolio companies, with over €2bn of acquired Enterprise Value. \n Alongside this, the pace of exits continues to build, with the sale of: \n ·      Punkta: the end-to-end platform for insurance services in the Polish market \n ·      Aro: acquired by Clearscore, a transaction that sets up the combined group for its next phase of growth \n This performance has translated into strong momentum in the final stages of fundraising of Private Equity Fund V, which has now surpassed the target. The Private Equity strategy continues to attract new investors and deepen the relationship with existing ones. The success of the fundraising of Private Equity Fund V is a reflection of the confidence that investors draw from Pollen Street's track record of top-tier returns, the pace of growth the investment team has demonstrated is achievable across the portfolio and the depth of pipeline of attractive deals into which the fund will be invested. \n   \n Michael England \n Partner \n 24 March 2025 \n \n \n Private Credit Strategy \n Matthew Potter \n Partner \n Pollen Street's Private Credit strategy is focused on asset-based lending (\"ABL\") to mid-market companies across Europe. The Group earns management fees, performance fees and carried interest from managing and advising funds investing in this strategy. This section gives insight into the strategy and its performance in 2024. \n Asset-based lending is the funding behind the everyday credit that powers our economy and society. We provide funding to support everything from building homes, to funding SMEs, to vehicle financing. We do this by providing predominantly senior secured loans to companies that are serving these end markets secured on diverse portfolios of cash flow generating assets, such as loans, leases and vehicles, alongside corporate guarantees. \n Following the global financial crisis, and the subsequent retrenchment of the banks from lending markets, Pollen Street identified opportunities to fill the funding gap in what is a large and growing market. This is a trend that has continued to accelerate further in recent years. Our asset-backed lending strategy aims to deliver returns uncorrelated to other private credit strategies with a through-the-cycle approach designed to withstand significant stress. Direct asset-backing combined with seniority, comprehensive covenants and bespoke structuring delivers significant downside protection and alignment with asset originators and servicers. Pollen Street has a proven ability to access a hard-to-reach market through our dedicated team, meaning we are able to consistently generate premium returns versus other private and public debt strategies. \n We are experts in this large market, with a deep network of long-term established relationships and experience that allows us to identify opportunities and target a fragmented and underpenetrated part of the market. Our team focuses on the mid-market where we believe the greatest opportunity and largest financing gap exists meaning we can create the most favourable risk-reward profile. This has increasingly led to Pollen Street having a reputation as the \"go-to\" provider in the market. \n We also believe in the positive economic impact our asset-backed financing can deliver. The facilities we provide fund the real economy and can deliver economic growth and job creation, facilitate the building of new homes and finance the energy transition. \n How it Works: Structuring for Protection \n The investment strategy seeks to combine the benefits of the asset-backed and corporate lending markets following a tested and structured investment approach that has delivered consistently strong returns and low volatility. Significant credit protection is created through both asset security and transaction structuring with senior loans secured directly against large and diverse pools of the assets which generate the revenue and cash flow of the borrowers, as well as securing a full corporate guarantee with comprehensive covenants. \n We seek to follow a structured investment approach that focuses on: \n ·      Diverse asset-backing: predominantly senior loans secured on highly diverse tangible assets to maintain credit protection; \n ·      Bespoke structuring: highly structured investments that seek to create strong downside protection and align incentives with our borrowers; and \n ·      Conservative leverage on assets with tangible value: substantial credit protection from borrower cash equity, asset pool profits and corporate guarantees. \n 2024 - Continued growth building on strong foundations \n In 2024, the Private Credit business has been focused on fundraising for our fourth flagship credit fund, Private Credit Fund IV, and continued deployment in both Private Credit Fund III and across our SMAs. With the backdrop of the completion of a £280 million SMA mandate from a large UK public pension fund and strong momentum in raising Private Credit Fund IV fundraising is progressing well. \n Driven by a deep pipeline, Private Credit Fund III is now fully deployed, with 21 investments and continues to generate attractive returns and high-income distributions for investors. The portfolio is performing well and has already delivered a number of realisations with realised returns ahead of underwritten expectations. \n Private Credit Fund IV deployment has started at pace, now benefiting from a well-seeded portfolio with 11 investments closed. Return performance has been strong and by sourcing a deep pipeline we have been able to be highly selective and have built strong diversification across asset classes in both the UK and Europe. \n Further, we were pleased to achieve a Fund Rating of \"A\" for Private Credit Fund IV, based on our investment approach and the strategy we deploy consistently across both Private Credit Fund III and Private Credit Fund IV. We believe this highlights the quality of our approach. \n Throughout 2024 debt markets remained buoyant with high volumes of primary issuance across public and private markets. This environment saw spreads reduce particularly across broadly syndicated and heavily intermediated markets where barriers to entry for capital are low and markets are highly efficient. In the asset-based lending sector we saw a similar increase in activity with borrowers looking to take advantage of the current environment to secure debt facilities to enable them to grow their businesses. Returns and margins are more resilient in mid-market ABL, as market inefficiencies and the bi-lateral nature of transactions create greater barriers to entry, meaning we are able to secure better lender terms and protections. Our pipeline is at record levels with net unlevered Internal Rate of Returns (\"IRRs\") still typically 11 per cent to 13 per cent, with a good balance between asset classes, including our key investment areas of SME, real estate and government backed receivables. \n   \n Matthew Potter \n Partner \n 24 March 2025 \n \n \n \n CFO Report \n Crispin Goldsmith \n Chief Financial Officer \n Delivering Strong Performance \n I am pleased to present Pollen Street's financial results for 2024. It has been a successful year, with strong growth in our financial performance from excellent fundraising outcomes and continued robust fund performance marking progress towards our medium-term targets. This has driven an increase in Fee-Paying AuM of £0.6 billion, or 17 per cent, on the prior year which has in turn generated higher management fees and allowed the Group to deliver profits for 2024 which are ahead of expectations. The Investment Company delivered performance in line with expectations despite the declining interest rate environment and the completion of £22.9 million of share buybacks which had the effect of reducing invested assets. \n Fundraising across both strategies brings total AuM to £5.4 billion as at 31 December 2024 (31 December 2023: £4.2 billion). Fundraising for Private Equity Fund V has been strong, as we continue to develop new relationships with investors and deepen existing ones, and is already ahead of our €1 billion target. We expect to complete the fundraising of this fund during 2025, with an additional £0.2 billion already closed in early 2025. In addition to the fundraising activity for Private Equity Fund V, we have also raised £0.4 billion of co-invest funds to invest alongside our flagship funds. \n Fundraising for Private Credit Fund IV has strong momentum as we capitalise on our leading position in the asset-backed market. We are on track to raise the target £1 billion in total commitments during 2025, with £0.1 billion closed in early 2025. Deployment of the new funds was active with 15 new deals and £238 million commitments invested; the business has a large pipeline of attractive new deals to continue this deployment into 2025. \n The Operating Profit for the Group increased by 31 per cent to £58.2 million (2023: £44.5 million). The main driver of this material increase was the 71 per cent increase in the Operating Profit of the Asset Manager segment to £27.2 million (2023: £15.9 million) as successful fundraising grew revenue, while the business benefitted from its inherent operational gearing. There was a £1.6 million increase in Operating Profit of the Investment Company, reflecting the positive effect of the transition into Pollen Street managed funds and the benefit of redeploying realised Credit Assets into a higher interest rate environment. \n The Investment Asset portfolio delivered another period of strong and consistent performance with Income on Net Investment Assets of £31.8 million (2023: £30.2 million). In particular, the portfolio generated a strong level of cash of £239 million (2023: £184 million), driven by a high level of realisations and demonstrating the quality and liquidity of the assets. \n In accordance with our strategy, investments from the Investment Company into Pollen Street managed funds have increased with £196 million currently committed, up from £93 million at December 2023. These commitments are typically drawn over several years. At 31 December 2024, £130 million had been drawn (2023: £57 million). \n Growing Asset Manager Earnings \n Assets under management are tracked on a total and fee-paying basis. Total AuM tracks the commitments that investors have made into funds managed by the Asset Manager, whereas Fee-Paying AuM tracks the basis on which the Group earns management fees. For Private Equity, the Fee-Paying AuM is the committed capital in the flagship funds, changing to invested capital at the earlier of five years from first close or when the subsequent flagship fund holds its first close. Co-investment vehicles are typically non-fee paying. Fee-Paying AuM for Private Credit is the net invested amount. So non-Fee-Paying AuM for Private Credit will become fee-paying as it is deployed. Total AuM was £5.4 billion as at 31 December 2024 (2023: £4.2 billion).   \n   \n   \n \n \n \n \n Total AuM \n \n \n 2024 \n (£ billion) \n \n \n 2023 \n (£ billion) \n \n \n \n \n Private Equity \n \n \n 3.5 \n \n \n 2.6 \n \n \n \n \n Credit \n \n \n 1.9 \n \n \n 1.6 \n \n \n \n \n Total \n \n \n 5.4 \n \n \n 4.2 \n \n \n \n \n   \n \n \n \n \n Fee-Paying AuM \n \n \n 2024 \n (£ billion) \n \n \n 2023 \n (£ billion) \n \n \n \n \n Private Equity \n \n \n 2.6 \n \n \n 2.0 \n \n \n \n \n Credit \n \n \n 1.4 \n \n \n 1.4 \n \n \n \n \n Total \n \n \n 4.0 \n \n \n 3.4 \n \n \n \n \n   \n Fundraising has increased Private Equity Fee-Paying AuM to £2.6 billion (2023: £2.0 billion), with Fee-Paying AuM for the Private Credit strategy at £1.4 billion (2023: £1.4 billion). The Private Credit strategy has seen the amortisation of several SMAs following underlying loan repayments offset by growth in deployment for its new funds. Combined, this represents a growth rate of 17 per cent in Fee-Paying AuM for the year. We expect Fee-Paying AuM for the Private Credit strategy to increase going forward as the newly raised funds in Private Credit Fund IV are deployed and convert into Fee-Paying AuM. \n As a result of continuing Private Equity fundraising and Private Credit deployment, Fee-Paying AuM has now increased to £4.3 billion. \n Fund Management Income comprises management fees, performance fees and income from carried interest. Revenue growth has been driven by increases in the Group's Fee-Paying AuM and the beneficial impact of catch-up fees, as outlined below. Total Income increased by 36 per cent to £66.8 million (2023: £49.2 million). \n Fund Management Administration Costs increased at a lower rate of 19 per cent to £39.6 million (2023: £33.3 million). This moderate increase reflects a well-invested cost base, leading to a flow through from incremental revenue to profitability. The cost increase has been driven by a combination of promotions and pay rises within the team and with a slight increase in headcount. As a result, Operating Profit in the Asset Manager segment increased by 71 per cent to £27.2 million (2023: £15.9 million). \n The Group tracks the performance of this segment using Fund Management EBITDA, which is the Operating Profit less the accounting cost of the office lease [1] , which was a £1.5 million charge for 2024 (2023: £1.0 million) driven by a rent review increase. Fund Management EBITDA has grown by 72 per cent to £25.7 million (2023: £14.9 million), while Fund Management EBITDA Margin has grown from 30 per cent to 39 per cent over the year, reflecting the inherent operational leverage in the Asset Manager. \n \n \n \n \n Asset Manager Profitability \n \n \n 2024 \n (£ million) \n \n \n 2023 \n (£ million) \n \n \n \n \n Total Income \n \n \n 66.8 \n \n \n 49.2 \n \n \n \n \n Administration Costs \n \n \n (39.6) \n \n \n (33.3) \n \n \n \n \n Operating Profit \n \n \n 27.2 \n \n \n 15.9 \n \n \n \n \n Depreciation of lease asset \n \n \n (1.5) \n \n \n (1.0) \n \n \n \n \n Fund Management EBITDA \n \n \n 25.7 \n \n \n 14.9 \n \n \n \n \n Fund Management EBITDA Margin \n \n \n 39% \n \n \n 30% \n \n \n \n \n Fund Management EBITDA now stands at 45 per cent of the Group EBITDA, up from 33 per cent in 2023. \n \n \n \n \n Asset Manager Financial Ratios \n \n \n 2024 \n \n \n 2023 \n \n \n \n \n Management Fee Rate \n (% of Average Fee-Paying AuM) \n \n \n 1.50% \n \n \n 1.16% \n \n \n \n \n Performance Fee Rate \n (% of Fund Management Income) \n \n \n 17% \n \n \n 30% \n \n \n \n \n Fund Management EBITDA Margin \n (% of Fund Management Income) \n \n \n 39% \n \n \n 30% \n \n \n \n \n   \n In general, Private Equity funds charge fees on committed capital. Investors who join these funds after the first investors' admission date are charged catch-up fees, so all investors pay fees from the date of the first close. In general, Private Credit funds charge fees on net invested capital. Capital is generally recycled until the end of the investment period. Management fee rates remain the same for the duration of the funds. We have guided to a long-term management fee rate blended across the Private Equity and Private Credit strategies of between 1.25 per cent and 1.5 per cent and are at the upper end of this guidance in 2024 at 1.50 per cent (2023: 1.16 per cent) in part due to the catch-up fees charged on the funds raised in Private Equity Fund V in the year. Excluding the £5.9 million of catch-up management fees charged, the Management Fee Rate for 2024 would have been 1.34 per cent. \n In addition to management fees, the Group earns performance fees and carried interest. These allow the Group to share in the profits of the funds under management and are variable amounts dependent on the level of fund returns. The entitlement to carried interest and the amount, is determined by the level of accumulated profits exceeding an agreed threshold (the \"hurdle\") over the lifetime of each fund. The Group earns 25 per cent of the carried interest in all funds since Fund IV in Private Equity and Fund III in Private Credit. Carried interest is generally 20 per cent of the Private Equity fund returns over a hurdle of 8 per cent per annum with full catch-up. Carried interest for the Private Credit funds is generally 10 per cent of returns with a 5 to 6 per cent hurdle and full catch-up. Performance fees and carried interest recognised in 2024 reflect the continued growth in the value of the fund portfolios and represents 17 per cent of Fund Management Income for the year (2023: 30 per cent) and 7 per cent of total income for the year (2023: 11 per cent). This is at the lower end of the long-term guidance of 15 per cent to 25 per cent of Fund Management Income, reflecting outperformance in management fees together with stable performance fee and carry valuation growth. \n As part of the combination of Pollen Street Capital Holdings Limited with Pollen Street Limited (formerly Honeycomb Investment Trust Plc) completed on 30 September 2022 (the \"Combination\"), the group purchased 25 per cent of the carried interest rights in two of the Private Equity Funds. These are recognised under IFRS 9 and represent 90 per cent of the recognised carried interest to date. The remaining carried interest owned by the Group is accounted for under IFRS 15 and income is only recognised to the extent it is highly probable that there would not be a significant reversal of any accumulated income recognised on the completion of a fund. The reversal risk due to uncertainty of future fund performance is managed through the application of discounts. The discount applied for each fund depends on the stage and maturity profile of each fund and therefore recognises the de-risking of the income over time, taking into account diversity of assets, whether there has been a recent market correction (and whether this has already been factored into the valuation of the fund) and the expected average remaining holding period. Under IFRS 15, if no discount rate was applied to the carried interest outstanding the carried interest receivable would increase by £13.1 million (2023: £5.2 million). \n Consistent Investment Company Returns \n The Investment Company delivered strong returns in the period with Return on Net Investment Assets increasing to 9.6 per cent and Income on Net Investment Assets of £31.8 million, in line with expectations despite £22.9 million of share buybacks, which had the effect of reducing invested assets. We have maintained our disciplined approach resulting in robust performance which is well diversified across deals and borrowers and the performance of Pollen Street managed funds. The largest investment accounted for 10.1 per cent of the portfolio, with the portfolio being 80 per cent invested in Credit Assets and 20 per cent invested in Private Equity Assets (either in direct deals or through Pollen Street managed funds). The portfolio has seen high levels of cash generation in the year of £239 million (2023: £184 million) driven by realisations and strong cash generation from interest payments and amortisations on continuing positions. This cash generation demonstrates the quality and liquidity of the portfolio and facilitates the rotation of the portfolio from direct investments to focus on investing in Pollen Street managed funds. \n \n \n \n \n Investment Company Segment \n \n \n 2024 \n \n \n 2023 \n \n \n \n \n Investment Assets \n \n \n £504 million \n \n \n £533 million \n \n \n \n \n Average Net Investment Assets \n \n \n £330 million \n \n \n £344 million \n \n \n \n \n Income on Net Investment Assets \n \n \n £31.8 million \n \n \n £30.2 million \n \n \n \n \n Return on Net Investment Assets \n \n \n 9.6% \n \n \n 8.8% \n \n \n \n \n   \n This transition has continued to progress during the year with £196 million committed to Pollen Street managed funds at the year end. These commitments were £130 million drawn as at 31 December 2024, and are expected to continue to draw over the investment period of the funds. As at 31 December 2024, the investment portfolio was £504 million (2023: £533 million). The phased drawdown of fund commitments combined with the high cash realisations in the year has led to a reduction in the size of the overall asset portfolio and a corresponding reduction in the debt position of the Group with a reduction in the debt-to-tangible-equity ratio from 60 per cent to 53 per cent. \n We completed a new 4-year £200 million senior debt facility on 10 June 2024 refinancing the previous facility and achieving a lower margin. This was subsequently upsized to £240 million on 13 December 2024 to refinance certain SPV facilities which enable us to reduce the operating cost base. The total drawn leverage for the Group was £188.3 million (2023: £210.8 million). In addition, the Group had £11.2 million (2023: £19.7 million) of cash resulting in a strong liquidity position and a net debt-to-tangible equity ratio of 50 per cent (2023: 54 per cent). \n Profit before Tax and Tax \n Profit before Tax for the Group increased by 31 per cent to £55.8 million for 2024 (2023: £42.6 million). The main drivers of this are the increase of £11.3 million in the Operating Profit from the Asset Manager segment, a £1.6 million increase in Operating Profit of the Investment Company. \n The charge for depreciation and amortisation is £2.4 million (2023: £1.9 million). This relates to a charge of £0.3 million (2023: £0.3 million) associated with the depreciation of the Group's fixed assets, a charge of £1.5 million (2023: £1.0 million) associated with the depreciation of the Group's leased assets and a charge of £0.6 million (2023: £0.6 million) associated with the amortisation of intangible assets representing the value of customer relationships. \n As a result of the Reorganisation, the Group now incurs corporation tax on all of its activities as the Investment Company is no longer an investment trust. The current tax charge for the period was £3.1 million (2023: £0.3 million), benefitting from unused tax losses arising from previously incurred management expenses in the Investment Company following the Reorganisation. The Group is now also able to recognise a deferred tax asset of £3.3 million as at 31 December 2024 (2023: nil) in respect of the balance of these unused tax losses. This deferred tax asset is expected to crystallise fully in 2025. The Group also recognised a deferred tax liability in respect of the recognition of fair value gains within the Investment Company and carried interest in the Asset Manager. The deferred tax liability of £8.9 million (2023: £3.1 million) will crystallise as the realised gain from these begins to flow to the Group in the medium term. The deferred tax charge for the year was £3.1 million (2023: £2.4 million). The effective tax rate for 2024 was 11.1 per cent (2023: 17.8 per cent [2] ). \n As detailed in Note 7 to the financial statements, the Group has a lower effective tax rate than the UK statutory rate. This is largely driven by timing differences on the taxation of management fee income and significant tax loss carry-forwards in the UK due to certain forms of income that are not subject to UK corporation tax. We expect the effective tax rate to increase going forward. \n   \n \n \n \n \n   \n \n \n 2024 \n (£ million) \n \n \n 2023 \n (£ million) \n \n \n \n \n Operating Profit of Asset Manager \n \n \n 27.2 \n \n \n 15.9 \n \n \n \n \n Operating Profit of Investment Company \n \n \n 31.8 \n \n \n 30.2 \n \n \n \n \n Operating Loss of Central segment \n \n \n (0.8) \n \n \n (1.6) \n \n \n \n \n Operating Profit of Group \n \n \n 58.2 \n \n \n 44.5 \n \n \n \n \n Depreciation and amortisation \n \n \n (2.4) \n \n \n (1.9) [3] \n \n \n \n \n Profit before Tax \n \n \n 55.8 \n \n \n 42.6 \n \n \n \n \n Corporation tax \n \n \n (6.2) \n \n \n (2.7) \n \n \n \n \n Profit after Tax \n \n \n 49.6 \n \n \n 39.9 \n \n \n \n \n   \n Earnings per Share & Dividends \n Earnings per share (basic and diluted) increased by 27 per cent to 78.8 pence per share (2023: 62.2 pence per share). The Board is pleased to confirm a second (and final) interim dividend for the period ended 31 December 2024 of 27.1 pence per share, amounting to a total payment of £16.5 million. This dividend, combined with the interim dividend payment of £16.5 million, is consistent with the Group's guidance that it will pay a dividend of no lower than £33.0 million in respect of 2024 and that dividends will grow progressively thereafter. This represents a £0.9 million increase on the total dividend paid in respect of 2023 of £32.1 million. \n During 2024, following completion of the Reorganisation and conversion to a commercial company, the timing of dividend payments was changed to allow for dividends to be declared on a semi-annual, rather than a quarterly, basis. As a result of this re-phasing there was a one-off reduction in dividend payments paid in 2024, from £32.1 million in 2023 to £24.9 million in 2024. Prior to conversion to a commercial company, net interest income was distributed to shareholders through dividends designated as interest distributions. As a commercial company, whilst maintaining a progressive dividend policy, it is expected that the Group will retain an increasing share of earnings in order to re-invest in value creation opportunities in line with the Capital Allocation Framework. \n The second interim dividend will be paid on 2 May 2025 to shareholders on the share register at the record date, being 4 April 2025. The ex-dividend date will be 3 April 2025. Pollen Street operates a Dividend Re-Investment Programme (\"DRIP\"), details of which are available from the Company's Registrars, Computershare. The final date for DRIP elections will be 9 April 2025. \n During 2024, we completed an initial share buyback programme with a commitment of up to £30.0 million, reflecting the confidence we have in the resilience of our business and the attractive fundamental value and prospects of the Group. At 31 December 2024, £22.9 million had been used to repurchase 3,222,257 shares. \n Outlook \n The Group remains in a strong position and is strategically well-placed and well-resourced for further growth in 2025 and beyond. Fund Management Income is expected to continue to grow with the final close of Private Equity Fund V above its target of €1 billion, and further capital raises in Private Credit Fund IV and their subsequent deployment under the Private Credit strategies. The balance sheet has delivered stable and robust performance with a healthy balance of direct positions and investments in Pollen Street managed funds to ensure alignment with Limited Partner interests. The Group is trading in line with expectations. \n In accordance with the Capital Allocation Framework announced in 2024, the Group intends to continue to pay a progressive dividend and may return surplus capital to shareholders through share buybacks. Moderate growth in the dividend, below the level of earnings growth, will allow dividend cover to increase over time. Any share buybacks will be subject to Board approval and will be evaluated against other value-creation opportunities available. \n   \n Crispin Goldsmith \n Chief Financial Officer \n 24 March 2025 \n   \n   \n \n \n Financial Statements \n   \n   \n \n \n Consolidated Statement of Profit or Loss and Other Comprehensive Income \n \n \n \n \n   \n \n \n   \n \n \n For the year ended \n 31 December 2024 \n \n \n For the year ended \n 31 December 2023 \n Unaudited [4] \n \n \n \n \n \n \n \n Notes \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n Management fee income \n \n \n 5 \n \n \n 50,282 \n \n \n 28,912 \n \n \n \n \n Carried interest and performance fee income \n \n \n 5, 14 \n \n \n 7,786 \n \n \n 11,480 \n \n \n \n \n Interest income on Credit Assets held at amortised cost \n \n \n 5 \n \n \n 41,380 \n \n \n 57,668 \n \n \n \n \n Gains on Investment Assets held at fair value \n \n \n 5, 10 \n \n \n 18,998 \n \n \n 5,102 \n \n \n \n \n Total income \n \n \n   \n \n \n 118,446 \n \n \n 103,162 \n \n \n \n \n Expected credit loss (charge) / release \n \n \n 5, 9 \n \n \n (593) \n \n \n 970 \n \n \n \n \n Third-party servicing costs \n \n \n 5 \n \n \n (1,177) \n \n \n (2,374) \n \n \n \n \n Net operating income \n \n \n   \n \n \n 116,676 \n \n \n 101,758 \n \n \n \n \n Administration costs \n \n \n 5 \n \n \n (41,931) \n \n \n (36,691) \n \n \n \n \n Finance costs \n \n \n 5, 17 \n \n \n (16,587) \n \n \n (20,590) \n \n \n \n \n Operating profit \n \n \n   \n \n \n 58,158 \n \n \n 44,477 \n \n \n \n \n Depreciation \n \n \n 5 \n \n \n (1,730) \n \n \n (1,233) \n \n \n \n \n Amortisation \n \n \n 5, 13 \n \n \n (640) \n \n \n (640) \n \n \n \n \n Profit before tax \n \n \n   \n \n \n 55,788 \n \n \n 42,604 \n \n \n \n \n Tax charge \n \n \n 7 \n \n \n (6,190) \n \n \n (2,664) \n \n \n \n \n Profit after tax \n \n \n   \n \n \n 49,598 \n \n \n 39,940 \n \n \n \n \n Other comprehensive income \n Foreign currency translation reserve \n \n \n \n \n \n 62 \n \n \n (453) \n \n \n \n \n Total comprehensive income \n \n \n   \n \n \n 49,660 \n \n \n 39,487 \n \n \n \n \n Earnings per share \n (basic and diluted) \n \n \n 8 \n \n \n 78.8 p \n \n \n 62.2 p \n \n \n \n \n   \n The notes to the accounts form an integral part of the financial statements. \n   \n \n \n \n Company Statement of Profit or Loss and Other Comprehensive Income \n \n \n \n \n   \n \n \n   \n \n \n For the year ended \n 31 December 2024 \n \n \n For the year ended \n 31 December 2023 \n \n \n \n \n \n \n \n Notes \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n Revenue \n \n \n 5 \n \n \n 40,508 \n \n \n 103 \n \n \n \n \n Administration costs \n \n \n 5 \n \n \n (1,486) \n \n \n (103) \n \n \n \n \n Profit before tax \n \n \n   \n \n \n 39,022 \n \n \n - \n \n \n \n \n Tax charge \n \n \n 7 \n \n \n - \n \n \n - \n \n \n \n \n Profit after tax \n \n \n   \n \n \n 39,022 \n \n \n - \n \n \n \n \n   \n The notes to the accounts form an integral part of the financial statements.   \n \n \n Consolidated Statement of Financial Position \n \n \n \n \n   \n \n \n   \n \n \n As at \n 31 December 2024 \n \n \n As at \n 31 December 2023 \n Unaudited 4 \n \n \n \n \n   \n \n \n Notes \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n Non-current assets \n \n \n \n \n \n \n \n \n \n \n \n \n \n Credit Assets at amortised cost \n \n \n 9 \n \n \n 309,423 \n \n \n 444,490 \n \n \n \n \n Investment Assets held at fair value through profit or loss \n \n \n 10 \n \n \n 194,176 \n \n \n 88,220 \n \n \n \n \n Fixed assets \n \n \n 11 \n \n \n 1,149 \n \n \n 1,277 \n \n \n \n \n Lease assets \n \n \n 12 \n \n \n 4,860 \n \n \n 3,817 \n \n \n \n \n Goodwill and intangible assets \n \n \n 13 \n \n \n 227,100 \n \n \n 227,740 \n \n \n \n \n Carried interest \n \n \n 14 \n \n \n 25,073 \n \n \n 17,332 \n \n \n \n \n Deferred tax asset \n \n \n 7 \n \n \n 3,256 \n \n \n - \n \n \n \n \n Total non-current assets \n \n \n   \n \n \n 765,037 \n \n \n 782,876 \n \n \n \n \n Current assets \n \n \n \n \n \n \n \n \n \n \n \n \n \n Trade and other receivables \n \n \n 15 \n \n \n 35,542 \n \n \n 17,942 \n \n \n \n \n Current tax receivable \n \n \n \n \n \n 561 \n \n \n - \n \n \n \n \n Cash and cash equivalents \n \n \n \n \n \n 11,195 \n \n \n 19,746 \n \n \n \n \n Total current assets \n \n \n   \n \n \n 47,298 \n \n \n 37,688 \n \n \n \n \n Total assets \n \n \n \n \n \n 812,335 \n \n \n 820,564 \n \n \n \n \n Current liabilities \n \n \n \n \n \n \n \n \n \n \n \n \n \n Interest-bearing borrowings \n \n \n 17 \n \n \n 498 \n \n \n 132,738 \n \n \n \n \n Trade and other payables \n \n \n 18 \n \n \n 29,249 \n \n \n 19,149 \n \n \n \n \n Lease liabilities \n \n \n 12 \n \n \n 1,376 \n \n \n 1,402 \n \n \n \n \n Current tax payable \n \n \n \n \n \n - \n \n \n 981 \n \n \n \n \n Derivative financial liabilities \n \n \n 16 \n \n \n 1,467 \n \n \n 179 \n \n \n \n \n Total current liabilities \n \n \n   \n \n \n 32,590 \n \n \n 154,449 \n \n \n \n \n Total assets less current liabilities \n \n \n   \n \n \n 779,745 \n \n \n 666,115 \n \n \n \n \n Non-current liabilities \n \n \n \n \n \n \n \n \n \n \n \n \n \n Interest-bearing borrowings \n \n \n 17 \n \n \n  187,767 \n \n \n 78,026 \n \n \n \n \n Lease liabilities \n \n \n 12 \n \n \n 3,756 \n \n \n 2,750 \n \n \n \n \n Deferred tax liability \n \n \n 7 \n \n \n 8,866 \n \n \n 3,093 \n \n \n \n \n Total non-current liabilities \n \n \n   \n \n \n 200,389 \n \n \n 83,869 \n \n \n \n \n Net assets \n \n \n   \n \n \n 579,356 \n \n \n 582,246 \n \n \n \n \n Shareholders' funds \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n Ordinary share capital \n \n \n 21 \n \n \n 610 \n \n \n 642 \n \n \n \n \n Share premium \n \n \n 21 \n \n \n 549,757 \n \n \n - \n \n \n \n \n Retained earnings \n \n \n \n \n \n 29,196 \n \n \n   4,978 \n \n \n \n \n Other reserves \n \n \n 21 \n \n \n (207) \n \n \n 576,626 \n \n \n \n \n Total shareholders' funds \n \n \n   \n \n \n 579,356 \n \n \n 582,246 \n \n \n \n \n Net asset value per share (pence) \n \n \n 23 \n \n \n 950.0 \n \n \n 906.8 \n \n \n \n \n   \n The notes to the accounts form an integral part of the financial statements. \n The financial statements of Pollen Street Group Limited (company number 70165), which includes the notes, were approved and authorised by the Board of Directors on 24 March 2025 and were signed on its behalf by: \n   \n Robert Sharpe \n Chair \n 24 March 2025 \n \n \n Company Statement of Financial Position \n \n \n \n \n   \n \n \n   \n \n \n As at \n 31 December 2024 \n \n \n As at \n 31 December 2023 \n \n \n \n \n   \n \n \n Notes \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n Non-current assets \n \n \n \n \n \n \n \n \n \n \n \n \n \n Investments in subsidiaries \n \n \n 28 \n \n \n 571,269 \n \n \n - \n \n \n \n \n Total non-current assets \n \n \n   \n \n \n 571,269 \n \n \n - \n \n \n \n \n Current assets \n \n \n \n \n \n \n \n \n \n \n \n \n \n Trade and other receivables \n \n \n 15 \n \n \n 23,986 \n \n \n 108 \n \n \n \n \n Total current assets \n \n \n   \n \n \n 23,986 \n \n \n 108 \n \n \n \n \n Total assets \n \n \n \n \n \n 595,255 \n \n \n 108 \n \n \n \n \n Current liabilities \n \n \n \n \n \n \n \n \n \n \n \n \n \n Trade and other payables \n \n \n 18 \n \n \n 29,167 \n \n \n 108 \n \n \n \n \n Total current liabilities \n \n \n   \n \n \n 29,167 \n \n \n 108 \n \n \n \n \n Net assets \n \n \n   \n \n \n 566,088 \n \n \n - \n \n \n \n \n Shareholders' funds \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n Ordinary share capital \n \n \n 21 \n \n \n 610 \n \n \n - \n \n \n \n \n Share premium \n \n \n 21 \n \n \n 542,972 \n \n \n - \n \n \n \n \n Retained earnings \n \n \n \n \n \n 22,506 \n \n \n - \n \n \n \n \n Total shareholders' funds \n \n \n   \n \n \n 566,088 \n \n \n - \n \n \n \n \n   \n The notes to the accounts form an integral part of the financial statements. \n The financial statements of Pollen Street Group Limited (company number 70165), which includes the notes, were approved and authorised by the Board of Directors on 24 March 2025 and were signed on its behalf by: \n   \n Robert Sharpe \n Chair \n 24 March 2025 \n   \n \n \n Consolidated Statement of Changes in Shareholders' Funds \n For the year ended 31 December 2024 \n \n \n \n \n   \n \n \n Ordinary Share Capital \n \n \n Share Premium \n \n \n Retained Earnings \n \n \n Special Distributable Reserve \n \n \n Merger Reserves \n \n \n Foreign Currency Translation Reserve \n \n \n Total Equity \n \n \n \n \n   \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 £'000 \n \n \n \n \n Shareholders' funds as at 1 January 2024 \n \n \n 642 \n \n \n - \n \n \n 4,978 \n \n \n 351,625 \n \n \n 225,270 \n \n \n (269) \n \n \n 582,246 \n \n \n \n \n Reallocation of reserves \n \n \n - \n \n \n 576,895 \n \n \n - \n \n \n (351,625) \n \n \n (225,270) \n \n \n - \n \n \n - \n \n \n \n \n Profit after taxation \n \n \n - \n \n \n - \n \n \n 49,598 \n \n \n - \n \n \n - \n \n \n - \n \n \n 49,598 \n \n \n \n \n Reclassification of transaction costs \n \n \n - \n \n \n 517 \n \n \n (517) \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n \n \n Transaction costs in relation to the Reorganisation \n \n \n - \n \n \n (4,833) \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (4,833) \n \n \n \n \n Dividends paid \n \n \n - \n \n \n - \n \n \n (24,863) \n \n \n - \n \n \n - \n \n \n - \n \n \n (24,863) \n \n \n \n \n Buybacks \n \n \n (32) \n \n \n (22,822) \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (22,854) \n \n \n \n \n Foreign currency translation reserve \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n 62 \n \n \n 62 \n \n \n \n \n Shareholders' funds as at \n 31 December 2024 \n \n \n 610 \n \n \n 549,757 \n \n \n 29,196 \n \n \n - \n \n \n - \n \n \n (207) \n \n \n 579,356 \n \n \n \n \n   \n   \n   \n \n   \n For the year ended 31 December 2023 \n \n \n \n \n   \n \n \n Ordinary Share Capital \n \n \n Share Premium \n \n \n Retained Earnings \n \n \n Special Distributable Reserve \n \n \n Merger Reserves \n \n \n Foreign Currency Translation Reserve \n \n \n Total Equity \n \n \n \n \n Unaudited 4 \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 £'000 \n \n \n \n \n Shareholders' funds as at 1 January 2023 \n \n \n 689 \n \n \n 299,599 \n \n \n 2 \n \n \n 51,979 \n \n \n 225,270 \n \n \n - \n \n \n 577,539 \n \n \n \n \n Profit after taxation \n \n \n - \n \n \n - \n \n \n 39,940 \n \n \n - \n \n \n - \n \n \n - \n \n \n 39,940 \n \n \n \n \n Dividends paid \n \n \n - \n \n \n - \n \n \n (31,664) \n \n \n - \n \n \n - \n \n \n - \n \n \n (31,664) \n \n \n \n \n Cancellation of treasury shares \n \n \n (47) \n \n \n 47 \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n \n \n Cancellation of share premium reserve \n \n \n - \n \n \n (299,646) \n \n \n - \n \n \n 299,646 \n \n \n - \n \n \n - \n \n \n - \n \n \n \n \n Reallocation of reserves \n \n \n - \n \n \n - \n \n \n (184) \n \n \n - \n \n \n - \n \n \n 184 \n \n \n - \n \n \n \n \n Transfer from goodwill \n \n \n - \n \n \n - \n \n \n (2,651) \n \n \n - \n \n \n - \n \n \n - \n \n \n (2,651) \n \n \n \n \n Deferred tax adjustment \n \n \n - \n \n \n - \n \n \n (465) \n \n \n - \n \n \n - \n \n \n - \n \n \n (465) \n \n \n \n \n Foreign currency translation reserve \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n (453) \n \n \n (453) \n \n \n \n \n Shareholders' funds as at \n 31 December 2023 \n Unaudited 4 \n \n \n 642 \n \n \n - \n \n \n 4,978 \n \n \n 351,625 \n \n \n 225,270 \n \n \n (269) \n \n \n 582,246 \n \n \n \n \n   \n The notes to the accounts form an integral part of the financial statements. \n \n \n Company Statement of Changes in Shareholders' Funds \n For the year ended 31 December 2024 \n \n \n \n \n   \n \n \n Ordinary Share Capital \n \n \n Share Premium \n \n \n Retained Earnings \n \n \n Total Equity \n \n \n \n \n   \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n Shareholders' funds as at 1 January 2024 \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n \n \n Issue of share capital \n \n \n 642 \n \n \n 570,627 \n \n \n - \n \n \n 571,269 \n \n \n \n \n Transaction costs in relation to the Reorganisation \n \n \n - \n \n \n (4,833) \n \n \n - \n \n \n (4,833) \n \n \n \n \n Profit after taxation \n \n \n - \n \n \n - \n \n \n 39,022 \n \n \n 39,022 \n \n \n \n \n Dividends paid \n \n \n - \n \n \n - \n \n \n (16,516) \n \n \n (16,516) \n \n \n \n \n Buybacks \n \n \n (32) \n \n \n (22,822) \n \n \n - \n \n \n (22,854) \n \n \n \n \n Shareholders' funds as at 31 December 2024 \n \n \n 610 \n \n \n 542,972 \n \n \n 22,506 \n \n \n 566,088 \n \n \n \n \n   \n For the year ended 31 December 2023 \n \n \n \n \n   \n \n \n Ordinary Share Capital \n \n \n Share Premium \n \n \n Retained Earnings \n \n \n Total Equity \n \n \n \n \n   \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n Shareholders' funds as at 1 January 2023 \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n \n \n Profit after taxation \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n \n \n Dividends paid \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n \n \n Shareholders' funds as at 31 December 2023 \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n \n \n   \n The notes to the accounts form an integral part of the financial statements. \n \n \n Consolidated Statement of Cash Flows \n \n \n \n \n   \n \n \n   \n \n \n For the year ended \n 31 December 2024 \n \n \n For the year ended \n 31 December 2023 \n Unaudited 4 \n \n \n \n \n   \n \n \n Notes \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n Cash flows from operating activities: \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cash generated from operations \n \n \n 24 \n \n \n 35,077 \n \n \n 37,225 \n \n \n \n \n Net repayments of Credit Assets at amortised cost \n \n \n \n \n \n 141,662 \n \n \n 82,741 \n \n \n \n \n Dividends received from Investment Assets \n \n \n \n \n \n  -   \n \n \n 1,507 \n \n \n \n \n Purchase of investments at fair value \n \n \n 10 \n \n \n (94,984) \n \n \n (44,227) \n \n \n \n \n Proceeds from disposal of investments at fair value \n \n \n 10 \n \n \n 6,483 \n \n \n 25,682 \n \n \n \n \n Tax paid \n \n \n \n \n \n (3,669) \n \n \n (105) \n \n \n \n \n Net cash inflow from operating activities \n \n \n   \n \n \n 84,569 \n \n \n 102,823 \n \n \n \n \n Cash flows from investing activities: \n \n \n \n \n \n \n \n \n \n \n \n \n \n Purchase of fixed assets \n \n \n 11 \n \n \n (156) \n \n \n (137) \n \n \n \n \n Net cash inflow from investing activities \n \n \n   \n \n \n (156) \n \n \n (137) \n \n \n \n \n Cash flows from financing activities: \n \n \n \n \n \n \n \n \n   \n \n \n \n \n Payment of lease liabilities \n \n \n 12 \n \n \n (1,564) \n \n \n (1,350) \n \n \n \n \n Reorganisation transaction costs \n \n \n \n \n \n (4,833) \n \n \n - \n \n \n \n \n Drawdown of interest-bearing borrowings \n \n \n 17 \n \n \n 240,500 \n \n \n 37,000 \n \n \n \n \n Repayments of interest-bearing borrowings \n \n \n 17 \n \n \n (260,519) \n \n \n (91,094) \n \n \n \n \n Transaction costs for financing activities \n \n \n 17 \n \n \n (2,880) \n \n \n - \n \n \n \n \n Interest paid on financing activities \n \n \n 17 \n \n \n (15,951) \n \n \n (19,135) \n \n \n \n \n Share buybacks \n \n \n \n \n \n (22,854) \n \n \n - \n \n \n \n \n Dividends paid in the year \n \n \n 22 \n \n \n (24,863) \n \n \n (31,664) \n \n \n \n \n Net cash outflow from financing activities \n \n \n   \n \n \n (92,964) \n \n \n (106,243) \n \n \n \n \n Net change in cash and cash equivalents \n \n \n   \n \n \n (8,551) \n \n \n (3,557) \n \n \n \n \n Cash and cash equivalents at the beginning of the year \n \n \n \n \n \n 19,746 \n \n \n 23,303 \n \n \n \n \n Cash and cash equivalents at the end of the year \n \n \n   \n \n \n 11,195 \n \n \n 19,746 \n \n \n \n \n   \n Interest received for the Group for the year ended 31 December 2024 was £33.5 million (2023: £53.9 million). \n The notes to the accounts form an integral part of the financial statements. \n \n \n Company Statement of Cash Flows \n \n \n \n \n   \n \n \n   \n \n \n For the year ended \n 31 December 2024 \n \n \n For the year ended \n 31 December 2023 \n \n \n \n \n   \n \n \n Notes \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n Cash flows from operating activities: \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cash generated from operations \n \n \n 24 \n \n \n 44,203 \n \n \n - \n \n \n \n \n Net cash inflow from operating activities \n \n \n   \n \n \n 44,203 \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 Reorganisation transaction costs \n \n \n \n \n \n (4,833) \n \n \n   \n \n \n \n \n Share buybacks \n \n \n \n \n \n (22,854) \n \n \n - \n \n \n \n \n Dividends paid in the year \n \n \n 22 \n \n \n (16,516) \n \n \n - \n \n \n \n \n Net cash outflow from financing activities \n \n \n   \n \n \n (44,203) \n \n \n - \n \n \n \n \n Net change in cash and cash equivalents \n \n \n   \n \n \n - \n \n \n - \n \n \n \n \n Cash and cash equivalents at the beginning of the year \n \n \n \n \n \n - \n \n \n - \n \n \n \n \n Cash and cash equivalents at the end of the year \n \n \n   \n \n \n - \n \n \n - \n \n \n \n \n   \n The notes to the accounts form an integral part of the financial statements. \n \n \n Notes to the Financial Statements \n 1.    General information \n Pollen Street Group Limited is a public company limited by shares, incorporated and registered under the laws of Guernsey with registration number 70165. Pollen Street Group Limited is referred to as the \"Company\", and together with its subsidiaries, the 'Group'. The registered office of the Company is: Mont Crevelt House, Bulwer Avenue, St. Sampson, Guernsey, GY2 4LH. The principal place of business of the Company is 11-12 Hanover Square, London, W1S 1JJ. \n The Company was established on 24 December 2021. The Company's purpose was to become the parent company of Pollen Street Limited (\"PSL\"), previously Pollen Street plc, by way of a scheme of arrangement (the \"Scheme\"). The Company's activities until the Scheme came into effect were compliance related. The scheme of arrangement came into effect on 24 January 2024. \n On 24 January 2024, the Company became the immediate and ultimate parent of Pollen Street Limited by way of a scheme of arrangement pursuant to Part 26 of the UK Companies Act 2006. As part of this, the shares of Pollen Street Limited were delisted and cancelled, and new shares were issued to the Company so that the Company holds 100 per cent of the issued shares in Pollen Street Limited. New shares in the Company were also issued to the former shareholders of Pollen Street Limited on a one-to-one basis and were admitted to trading on the London Stock Exchange's (\"LSE\") main market for listed securities. \n On 14 February 2024, Pollen Street Limited distributed the entire issued share capital of Pollen Street Capital Holdings Limited (\"PSCHL\") to the Company referred to as the Distribution. The Scheme and the Distribution are together referred to as the \"Reorganisation\". \n The principal activity of the Group is to act as an alternative asset manager investing within the financial and business services sectors across both Private Equity and Private Credit strategies, as well as holding on-balance sheet investments consisting of both direct investments and investments in funds managed by Pollen Street. The principal activity of the Company is to be the holding company for two 100 per cent owned subsidiaries engaged in these asset management and investment activities. \n \n \n 2.    Material accounting policies \n Basis of preparation \n These financial statements have been prepared in accordance with UK-adopted International Accounting Standards and with the requirements of The Companies (Guernsey) Law 2008, and the Disclosure Guidance and Transparency Rules sourcebook of the UK's Financial Conduct Authority (\"FCA\"). The accounting policies comprise standards and interpretations approved by the International Accounting Standards Board (\"IASB\") and International Financial Reporting Committee as adopted in the UK, including interpretations issued by the IFRS Interpretations Committee and interpretations issued by the International Accounting Standard Committee (\"IASC\") that remain in effect. \n The Reorganisation is a capital reorganisation and has been accounted for using the book-value method. This method applies retrospectively, meaning that the financial statements are restated as if the Reorganisation had occurred at the beginning of the earliest period presented, i.e. from 1 January 2023. \n The prior year comparatives are unaudited for Pollen Street Group Limited. They are based on the audited consolidated financial statements for Pollen Street Limited as set out in the Pollen Street Limited Annual Report and Accounts for the year ended 31 December 2023 and the audited Pollen Street Group Limited financial statements for the year ended 31 December 2023 as set out in the Pollen Street Group Limited Annual Report and Accounts for the year ended 31 December 2023. These numbers have been included as comparatives in accordance with the book-value method of accounting for capital reorganisations. Refer to the Capital Reorganisation accounting policy below for more details. \n Going concern \n The Directors have reviewed the financial projections of the Group, which show that the Group will be able to generate sufficient cash flows in order to meet its liabilities as they fall due within 12 months from the approval of these financial statements. These financial projections have been performed for the Group under stressed scenarios, and in all cases the Group is able to meet its liabilities as they fall due. For the Investment Company, the stressed scenarios included halting future Investment Asset originations, late repayments of the largest structured facility and individual exposures experience ongoing performance at the worst monthly impact experienced throughout 2023 and 2024. For the Asset Manager, the stressed scenarios included no new funds being raised. \n The Directors consider these scenarios to be the most relevant risks to the Group's operations. Finally, the Directors reviewed financial and non-financial covenants in place for all debt facilities within the subsidiaries of the Group with no breaches anticipated, even in the stressed scenario. The Directors are satisfied that the going concern basis remains appropriate for the preparation of the financial statements. \n The material accounting policies adopted by the Company are set out below and have been consistently applied across periods presented and all values are in pounds. \n Adoption of new and amended standards and interpretations \n Standards, interpretations and amendments to published standards effective for the year ended 31 December 2024 \n The following new and amended standards do not have a material impact on the Group's financial statements: \n \n \n \n \n International accounting standards and interpretations \n \n \n Effective date \n \n \n \n \n Amendments to IAS 1: Classification of Liabilities as Current or Non-current and Non-current liabilities with covenants \n \n \n 1 January 2024 \n \n \n \n \n Amendments to IFRS 16: Lease liability in a sale and leaseback \n \n \n 1 January 2024 \n \n \n \n \n Amendments to IAS 7 and IFRS 7: Supplier Finance Arrangements \n \n \n 1 January 2024 \n \n \n \n \n   \n Standards, interpretations and amendments to published standards which are not yet effective \n New and amended standards that have been issued, but are not yet effective, up to the date of the Group's financial statements are disclosed below. These standards do not have a material impact on the Group's financial statements, with the exception of IFRS 18: 'Presentation and Disclosure in Financial Statements' which will impact the presentation and disclosure of financial statements. The Group plans to adopt these, if applicable, when they become effective. \n \n \n \n \n International accounting standards and interpretations \n \n \n Effective date \n \n \n \n \n Amendments to IAS 21: Lack of Exchangeability \n \n \n 1 January 2025 \n \n \n \n \n Amendments to IFRS 9 and IFRS 7: Amendments to the Classification and Measurement of Financial Instruments \n \n \n 1 January 2026 \n \n \n \n \n New Accounting Standard IFRS 18: 'Presentation and Disclosure in Financial Statements' \n \n \n 1 January 2027 \n \n \n \n \n New Accounting Standard IFRS 19: 'Subsidiaries without Public Accountability: Disclosures' \n \n \n 1 January 2027 \n \n \n \n \n \n \n Accounting policies \n Consolidation \n Subsidiaries are investees controlled by the Company. The Company controls an investee if it is exposed to, or has the rights to, variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. The Company reassesses whether it has control if there are changes to one or more elements of control. The Company does not consider itself to be an investment entity for the purposes of IFRS 10, as it does not hold substantially all of its investments at fair value. Consequently, it consolidates its subsidiaries rather than holding at fair value through profit or loss. \n The Group also assessed the consolidation requirements for the carried interest partnerships and certain underlying entities of Pollen Street managed funds (\"funds\") which the Group holds as investments as explained in the investments in associates section. Refer to Note 28 for further details. \n In the consolidated financial statements, intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated. All entities within the Group have coterminous reporting dates. \n Capital reorganisation \n Capital reorganisations are accounted for using the book-value method. This methodology is used as these transactions do not represent a substantive change in ownership. Instead, they are viewed as a reorganisation of entities within the same group. The Directors consider this method to be the most accurate reflection of the historical financial performance and position of the combining entities following the Reorganisation. \n This method applies retrospectively, meaning that the financial statements are restated as if the Reorganisation had occurred at the beginning of the earliest period presented. The assets and liabilities of the combining entities are recognised at their carrying amounts in the financial statements. No adjustments are made to reflect fair values or recognise any new assets or liabilities, except where necessary to align accounting policies. \n Any consideration transferred is recognised at its carrying amount. The difference between the consideration transferred and the carrying amount of the net assets acquired is recognised in equity. \n Comparative information is restated to reflect the reorganisation as if it had occurred at the beginning of the earliest period presented, i.e. 1 January 2023. This ensures consistency and comparability of financial information across periods. Therefore, the prior year comparatives reflect those of the Group when Pollen Street Limited was the ultimate parent of the Group. These numbers were audited as part of the Pollen Street Limited consolidated Annual Report and Accounts for the year ended 31 December 2023. \n Refer to Note 4 for further details. \n Investments in subsidiaries \n Investments in subsidiaries in the Statement of Financial Position of the Company are recorded at cost less provision for impairments. All transactions between the Company and its subsidiary undertakings are classified as related party transactions for the Company accounts and are eliminated on consolidation. \n Investments in associates \n Associates are entities over which the Group has significant influence, but does not control, generally accompanied by a shareholding of between 20 per cent and 50 per cent of the voting rights. \n Before the acquisition of Pollen Street Limited by the Company, Pollen Street Limited acquired carried interest rights in two Private Equity funds as part of the Combination on 30 September 2022. The rights are in the form of partnership participations in carried interest partnerships. The Group has 25 per cent of the total interests in these partnerships. The Group has in excess of 20 per cent participation and therefore is considered to have significant influence over the partnerships and the partnerships are considered to be an associate. \n The Directors also consider any influence that the Group has in the set up of any new carried interest partnerships in order to assess the power to control them. The Group has between 1 per cent and 25 per cent of the total interests in these partnerships. It was determined that the carried interest partnerships were set up on behalf of the fund investors, and that on balance, the Group does not control the carried interest partnerships. Where the Group has in excess of 20 per cent of LP interest in the carried interest partnership, the Group is considered to have significant influence. It was therefore determined that these carried interest partnerships are also accounted for as associates. \n These carried interest partnerships (including associates and contract assets) are presented in the 'Carried interest' line on the Consolidated Statement of Financial Position; and income from the carried interest partnerships is presented in the 'Carried interest and performance fee income' line on the Consolidated Statement of Profit or Loss and Other Comprehensive Income. \n The key judgemental areas for the accounting of carried interest partnerships are set out in Note 3, Significant accounting estimates and judgements. \n For the underlying entities or funds, the Directors consider the nature of the relationships between the Group, the underlying entities or funds and the investors. The Directors also consider any influence that the Group has in the set up of the underlying entities or funds in order to assess the power to control the underlying entities or funds. It was determined that the underlying entities or funds were set up for the investors, and that on balance, the Group does not control the underlying entities or funds. \n The Group also holds more than 20 per cent of interest in certain underlying entities or funds. The Group elects to hold these investments in associates at Fair Value Through Profit or Loss (\"FVTPL\"). This treatment is permitted by IAS 28 Investments in Associates and Joint Ventures, which permits investments held by entities that are venture capital organisations, mutual funds or similar entities to be excluded from its measurement methodology requirements where those investments are designated, upon initial recognition, as at FVTPL and accounted for in accordance with IFRS 9. These underlying entities or funds are presented in the 'Investment Assets held at fair value through profit or loss' line on the Consolidated Statement of Financial Position. Changes in fair value of these entities or funds are presented in the 'Gains on Investment Assets held at fair value' on the Consolidated Statement of Profit or Loss and Other Comprehensive Income. \n Details of how the Group classifies and measures assets at FVTPL are in the classification and measurement section. \n Business model assessment \n The Group assesses the objective of the business model in which a financial asset is held at a portfolio level in order to generate cash flows because this best reflects the way the business is managed. That is, whether the Group's objective is solely to collect the contractual cash flows from the assets or is to collect both the contractual cash flows and cash flows arising from the sale of assets. If neither of these are applicable, then the financial assets are classified as part of the other business model and measured at FVTPL. \n The assessment includes: \n ·      the stated policies and objectives for the portfolio and the operation of those policies in practice, including whether the strategy focuses on earning contractual interest revenue, maintaining a particular interest rate profile, matching duration of the financial assets to the duration of the liabilities that are funding those assets or realising cash flows through the sale of assets; \n ·      past experience on how the cash flows for these assets were collected; \n ·      how the performance of the portfolio is evaluated and reported; \n ·      the risks that affect the performance of the business model (and the financial assets held within that business model) and how those risks are managed; and \n ·      the frequency, volume and timing of deployment in prior years, the reasons for such deployment and expectations about future deployment activity. However, information about deployment activity is not considered in isolation, but as part of an overall assessment of how the stated objective for managing the financial assets is achieved and how cashflows are realised. \n Assessment of whether contractual cash flows are solely payments of principal and interest \n For the purposes of this assessment, \"principal\" is defined as the fair value of the financial asset on initial recognition. \"Interest\" is defined as consideration for the time value of money, for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and costs (e.g. liquidity risk and administrative costs), as well as a reasonable profit margin. \n In assessing whether the contractual cash flows are solely payments of principal and interest, the contractual terms of the instrument are considered. This includes assessing whether the financial asset contains a contractual term that could change the timing or amount of contractual cash flows such that it would not meet this condition. In making the assessment the following features are considered: \n ·      contingent events that would change the amount and timing of cash flows; \n ·      leverage features; \n ·      prepayment and extension terms; \n ·      terms that limit the Group's claim to cash flows from specified assets, e.g. non-recourse asset arrangements; and \n ·      features that modify consideration for the time value of money, e.g. periodic reset of interest rates. \n Classification and measurement \n Financial assets and financial liabilities are recognised in the Consolidated Statement of Financial Position when the Group becomes a party to the contractual provisions of the instrument. The Group shall offset financial assets and financial liabilities if it has a legally enforceable right to set off the recognised amounts and interests and intends to settle on a net basis. Financial assets and liabilities are derecognised when the Group settles its obligations relating to the instrument. \n Classification and measurement - Financial assets \n IFRS 9 contains a classification and measurement approach for debt instruments that reflects the business model in which assets are managed and their cash flow characteristics. This is a principle-based approach and applies one classification approach for all types of debt instruments. For debt instruments, two criteria are used to determine how financial assets are classified and measured: \n ·      the entity's business model (i.e. how an entity manages its debt Instruments in order to generate cash flows by collecting contractual cash flows, selling financial assets or both); and \n ·      the contractual cash flow characteristics of the financial asset (i.e. whether the contractual cash flows are solely payments of principal and interest). \n A debt instrument is measured at amortised cost if it meets both of the following conditions and is not designated as at FVTPL: \n a)     it is held within a business model whose objective is to hold assets to collect contractual cash flows; and \n b)     its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. \n IFRS 9 details the classification and measurement approach for assets measured at fair value through other comprehensive income (\"FVOCI\") if it meets both of the following conditions and is not designated as at FVTPL: \n a)     it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and \n b)     its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. \n Equity instruments and derivatives are measured at FVTPL, unless they are not held for trading purposes, in which case an irrevocable election can be made on initial recognition to measure them at FVOCI with no subsequent reclassification to profit or loss. This election is made on an investment by investment basis. \n All financial assets not classified as measured at amortised cost or FVOCI as described above are measured at FVTPL. \n All equity positions are measured at FVTPL. Financial assets measured at FVTPL are recognised in the balance sheet at their fair value. Fair value gains and losses together with interest coupons and dividend income are recognised in the Consolidated Statement of Profit or Loss and Other Comprehensive Income within Gains on Investment Assets held at fair value in the period in which they occur. The fair values of assets and liabilities traded in active markets are based on current bid and offer prices respectively. If the market is not active the Group establishes a fair value by using valuation techniques. In addition, on initial recognition the Group may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortised cost or at FVOCI as FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise. \n The Group does not hold any FVOCI assets. \n Classification and measurement - Financial liabilities \n Financial liabilities are classified and subsequently measured at amortised cost, except for: \n ·      Financial liabilities at fair value through profit or loss: this classification is applied to derivatives, financial liabilities held for trading and other financial liabilities designated as such at initial recognition. Gains or losses on financial liabilities designated at fair value through profit or loss are presented partially in other comprehensive income (the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability, which is determined as the amount that is not attributable to change in market conditions that give rise to market risk) and partially in profit or loss (the remaining amount of change in the fair value of the liability). This is unless such a presentation would create, or enlarge, an accounting mismatch, in which case the gains and losses attributable to changes in the credit risk of the liability are also presented in the Consolidated Statement of Profit or Loss and Other Comprehensive Income. \n ·      Financial liabilities arising from the transfer of financial assets which did not qualify for derecognition, whereby a financial liability is recognised for the consideration received for the transfer. In subsequent years, the Group recognises any expense incurred on the financial liability. \n ·      Financial guarantee contracts and loan commitments. \n Credit Assets at amortised cost \n Loans are initially recognised at a carrying value equivalent to the funds advanced to the borrower plus the cost of acquisition fees and transaction costs. After initial recognition loans are subsequently measured at amortised cost using the effective interest rate method (\"EIRM\") less expected credit losses (see Note 9). \n Expected credit loss allowance for financial assets measured at amortised cost \n The credit impairment charge or release in the Consolidated Statement of Profit or Loss and Other Comprehensive Income represents the change in expected credit losses which are recognised for loans and advances to borrowers, other financial assets held at amortised cost. \n IFRS 9 applies a single impairment model to all financial instruments subject to impairment testing. Impairment losses are recognised on initial recognition, and at each subsequent reporting period, even if the loss has not yet been incurred. In addition to past events and current conditions, reasonable and supportable forecasts affecting collectability are also considered when determining the amount of impairment in accordance with IFRS 9. \n At initial recognition, allowance is made for expected credit losses resulting from default events that are possible within the next 12 months (12-month expected credit losses). In the event of a significant increase in credit risk, allowance (or provision) is made for expected credit losses resulting from all possible default events over the expected life of the financial instrument (lifetime expected credit losses). Financial assets where 12-month expected credit losses are recognised are considered to be Stage 1; financial assets which are considered to have experienced a significant increase in credit risk are in Stage 2; and financial assets which have defaulted or are otherwise considered to be credit-impaired are allocated to Stage 3. Stage 2 and Stage 3 are based on lifetime expected credit losses. \n The measurement of expected credit loss (\"ECL\"), is primarily based on the product of the instrument's probability of default (\"PD\"), loss given default (\"LGD\") and exposure at default (\"EAD\"), taking into account the value of any collateral held or other mitigants of loss and including the impact of discounting using the EIR. \n ·      The PD represents the likelihood of a borrower defaulting on its financial obligation, either over the next 12 months (\"12M PD\"), or over the remaining lifetime (\"Lifetime PD\") of the obligation. \n ·      EAD is based on the amounts the Group expects to be owed at the time of default, over the next 12 months or over the remaining lifetime. For example, for a revolving commitment, the Group includes the current drawn balance plus any further amount that is expected to be drawn up to the current contractual limit by the time of default, should it occur. The EAD is discounted back to the reporting date using the EIR determined at initial recognition. \n ·      LGD represents the Group's expectation of the extent of loss on a defaulted exposure. LGD varies by type of counterparty, type and seniority of claim and avai...

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