Business
Preliminary results
Preliminary results.
About this update from First Property Group Plc
Date: 19 June 2025 On Behalf of: First Property Group plc ("First Property", the "Company" or the "Group") Embargoed: 0700hrs First Property Group plc Preliminary results for the year ended 31 March 2025 (Unaudited) First Property Group plc (AIM: FPO), the property fund manager and investor with operations in the United Kingdom and Central Europe, today announces its unaudited preliminary results for the year ended 31 March 2025. Highlights: · Statutory profit before tax for the year: £3.03 million (31 March 2024: loss before tax: £4.41 million) · Initiated cost savings programme which resulted in annualised cost savings of c.£650,000 · Reduction in gross debt by £3.25 million (12%) and net debt by £3.44 million (15%) · Cash at 31 March 2025: £4.82 million (31 March 2024: £4.63 million) · Third party Assets Under Management ("AUM") at 31 March 2025: £164 million (31 March 2024: £222 million) · Total AUM at 31 March 2025: £220 million (31 March 2024: £274 million) · Weighted average unexpired fund management contract term at 31 March 2025: 3 years, 4 months (31 March 2024: 1 year, 9 months) Financial summary: Unaudited year to 31 March 2025 Audited year to 31 March 2024 Percentage change Income statement: Statutory profit/(loss) before tax £3.03m (£4.41m) 168.71% Diluted earnings/(loss) per share 1.64p (4.04p) 140.59% Total dividend per share - - - Average €/£ exchange rate 1.1911 1.1606 - Financial position at the year-end: Investment properties at book value £46.76m £45.76m 2.19% Investment properties at market value £56.04m £51.90m 7.98% Associates and investments at book value £21.73m £19.90m 9.23% Associates and investments at market value £22.60m £20.26m 11.55% Cash balances £4.82m £4.63m 4.10% Cash per share 3.26p*** 4.18p -22.01% Gross debt £24.37m £27.62m -11.77% Net debt £19.55m £22.99m -14.96% Gearing ratio at book value* 35.08% 41.47% - Gearing ratio at market value* 31.50% 38.28% - Net assets at book value** £45.09m £38.98m 15.67% Net assets at market value £52.99m £44.53m 19.00% Adjusted net assets per share (EPRA basis)*** 35.72p 39.41p -9.36% Year-end €/£ rate 1.1949 1.1697 - *Gearing ratio = Gross debt divided by gross assets **Attributable to the owners of the parent, excludes non-controlling interests ***Calculation includes new shares issued following completion of the Company's open offer on 23 September 2024. Commenting on the results, Ben Habib, Chief Executive of First Property Group plc, said: "I am pleased to report a material turnaround in the fortunes of the Group. "We appear to be close to the bottom of the cycle, following what has been a severe downturn, especially for office properties. "The economic outlook remains uncertain and it remains a buyer's market. Even with this uncertain outlook we are seeing interesting deals, some of which we hope to secure. "We are treading cautiously but our fortunes have improved and we expect this to continue." A briefing for analysts and shareholders will be held at 11.00hrs today via Investor Meet Company. To participate it is necessary to register at https://www.investormeetcompany.com/first-property-group-plc/register-investor and select to meet the Company. Those who have already registered and selected to meet the Company will be automatically invited. A copy of the accompanying investor presentation will be posted on the Company's website. For further information please contact: First Property Group plc Tel: +44 (20) 7340 0270 Ben Habib (Chief Executive Officer) Laura James (Group Finance Director) Jeremy Barkes (Director, Business Development) www.fprop.com [email protected] Jill Aubrey (Director, Compliance and Company Secretary) Allenby Capital (NOMAD & Broker) Tel: + 44 (0) 20 3328 5656 Nick Naylor / Daniel Dearden-Williams (Corporate Finance) Amrit Nahal / Tony Quirke (Sales and Corporate Broking) Notes to Investors and Editors : First Property Group plc is an award-winning property fund manager and investor with operations in the United Kingdom and Central Europe. Its focus is on higher yielding commercial property with sustainable cash flows. The Company is flexible and takes an active approach to asset management. Its earnings are derived from: · Fund Management - via its FCA regulated and AIFMD approved subsidiary, First Property Asset Management Ltd ("FPAM"), which earns fees from investing for third parties in property. FPAM currently manages eleven funds which are invested across the United Kingdom, Poland and Romania. · Group Properties - principal investments by the Group, to earn a return on its own capital, usually in partnership with third parties. As at 31 March 2025, investments comprised six directly held properties in Poland, one in Romania, and non-controlling interests in nine of the eleven funds managed by FPAM. Quoted on AIM, the Company has offices in London and Warsaw. Further information about the Company and its properties can be found at: www.fprop.com . CHIEF EXECUTIVE'S STATEMENT Financial performance I am pleased to report the Group's unaudited preliminary results for the year ended 31 March 2025, which yielded a profit before tax of £3.03 million (31 March 2024: loss before tax of: £4.41 million). The turnaround in the Group's fortunes is mainly attributable to lower impairment charges in the value of the Group's direct investments in Poland of £0.24 million (2024: £3.75 million), an increase in the value of the Group's 23% share in Fprop Phoenix Ltd (FPL) by £1.73 million, and cost-cutting measures which resulted in total annualised savings of around £650,000. In September 2024, the Group raised £2.96 million (before expenses) through an open offer of new Ordinary Shares to all qualifying shareholders. The proceeds were used to: 1. meet contractual liabilities in respect of deferred consideration payments (£1.97 million) for Blue Tower, an office building in Warsaw, which is directly owned by the Group; 2. fund capital expenditure incentives for tenants as the Group continues to lease the remaining vacant space in its portfolio (£1.42 million); and 3. strengthen the Group's balance sheet. The open offer was underwritten by the Group's CEO and Chairman, demonstrating their confidence in the Group's prospects and the Board's strategy. The Group ended the financial year with net assets calculated under the cost basis of accounting, excluding non-controlling interests, of £45.09 million (31 March 2024: £38.98 million), equating to 30.50 pence per share (31 March 2024: 35.15 pence per share). It is the accounting policy of the Group to carry its properties and interests in associates at the lower of cost or market value. The net assets of the Group when adjusted to their market value less any deferred tax liabilities (EPRA basis) amounted to £52.99 million or 35.72 pence per share at 31 March 2025 (31 March 2024: £44.53 million or 39.41 pence per share). Gross debt at the year-end reduced to £24.37 million (31 March 2024: £27.62 million), £14.92 million of which was non-interest bearing and represented deferred consideration for the purchase of two office properties in Poland. Net debt reduced to £19.55 million (31 March 2024: £22.99 million). The debt was secured against six directly owned properties in Poland. The Group's gearing ratio with its properties at their book value was 35.08% (31 March 2024: 41.47%) and with its properties at their market value was 31.50% (31 March 2024: 38.28%). Group cash balances at the year-end stood at £4.82 million (31 March 2024: £4.63 million), equivalent to 3.26 pence per share (31 March 2024: 4.18 pence per share). The calculation includes new shares issued following completion of the open offer on 23 September 2024. The diluted earnings per share was 1.64 pence (2024: loss per share 4.04 pence). Dividend The Directors have resolved not to pay a dividend in respect of the year ended 31 March 2025 (31 March 2024: nil). REVIEW OF OPERATIONS PROPERTY FUND MANAGEMENT Third party assets under management ended the year at £164.0 million (31 March 2024: £221.8 million). The decrease in value of third party funds under management was mainly due to the sale by four funds of nineteen properties in the United Kingdom for an aggregate value of £63.1 million. Fund management fees are levied monthly by reference to the value of properties, except for Fprop Offices LP ("OFFICES"), in which the Group participates in a profit share arrangement instead. OFFICES has reached the end of its fund life and will be wound up after its last remaining property is sold. The profit earned by this division before unallocated central overheads and tax increased by £0.22 million to £1.04 million (2024: £0.82 million) even though revenue decreased by 23% to £2.26 million (2024: £2.95 million). The decrease in revenue was due to a reduction in third party assets under management and a reduction in one-off advance payments of £300,000 (2024: £411,000), mainly pertaining to the Group's defined benefit pension scheme clients which are generally recycling their investments into more liquid asset classes. The advance payments were in respect of fund management fees paid by one such client, the BAE Systems Pension Funds Trustees Limited (SIPS), due to property sales prior to the end of the fund's life. The increase in profit was mainly attributable to cost saving measures implemented during the year. At the financial year end fund management fee income, excluding performance fees, was being earned at an annualised rate of £1.20 million (31 March 2024: £1.83 million). The weighted average unexpired fund management contract term at the financial year-end was 3 years, 4 months (31 March 2024: 1 year, 9 months). The reconciliation of movement in third party funds managed by FPAM during the year is shown below: Funds managed for third parties (including funds in which the Group is a minority shareholder) UK £m CEE £m Total £m No. of properties As at 1 April 2024 115.01 106.76 221.77 35 Property purchases 6.40 - 6.40 2 Property sa les (63.08) - (63.08) (19) Capital expenditure 0.19 0.37 0.56 - Property revaluation (1.75) 2.64 0.89 - FX revaluation - (2.63) (2.63) - As at 31 March 2025 56.77 107.14 163.91 18 An overview of the value of assets and maturity of each of the funds managed by FPAM is set out below: Fund Country of investment Fund expiry Assets under management at market value at 31 March 2025 No. of properties % of total third-party assets under management Assets under management at market value at 31 March 2024 £m. £m. OFFICES UK Jun 2024 27.5 1 16.8 47.4 SIPS UK Jan 2025 3.5 1 2.1 33.8 FGC Poland Mar 2026 23.9 1 14.5 21.7 UK PPP UK Jan 2027 2.6 1 1.6 13.6 SPEC OPPS UK Jan 2027 9.5 3 5.8 12.7 FKR Poland Mar 2027 15.5 1 9.5 16.4 FCL Romania Jun 2028 8.0 1 4.9 8.3 FPL Poland Jun 2028 - - - - FOP Poland Oct 2030 59.8 5 36.4 60.3 FULCRUM UK Indefinite 13.7 4 8.4 7.6 Total Third-Party AUM 164.0 18 100.0 221.8 The sub sector weightings of investments in FPAM funds is set out in the table below: UK Poland Romania Total % of Total £m. £m. £m. £m. Offices 50.22 36.08 8.04 94.34 57.5% Retail warehousing 6.55 - - 6.55 4.0% Supermarkets - 11.89 - 11.89 7.3% Shopping centres - 51.13 - 51.13 31.2% Total 56.77 99.10 8.04 163.91 100.0% % of Total Third-Party AUM 34.6% 60.5% 4.9% 100.0% GROUP PROPERTIES DIVISION The Group Properties division comprised: 1. seven directly owned commercial properties in Poland and Romania valued at £56.04 million (31 March 2024: £51.90 million); and 2. interests in nine of the eleven funds managed by FPAM (classified as Associates and Investments) valued at £22.60 million (31 March 2024: £20.26 million) . This division made a profit of £3.16 million before tax and unallocated central overheads (year ended 31 March 2024: loss of £3.79 million). The main contribution (£3.21 million) was from the Group's Associates and Investments, in particular from the Group's 23% shareholding in FPL, which contributed £1.73 million. This division also benefitted from £422,000 in cash distributions from the Group's share in The UK Pension Property Portfolio ("UK PPP") and Fprop UK Special Opportunities LP ("Spec Opps"). 1. Directly owned Group Properties (all accounted for under the cost model): The book value of the Group's seven directly owned properties was £46.76 million (31 March 2024: £45.76 million). Their market value, based on valuations at 31 March 2025, was £56.04 million (31 March 2024: £51.90 million). Country Sector Property/ Fund Name No. of props 31 March 2025 Book value 31 March 2025 Market value 31 March 2025 *Contribution to Group profit before tax 31 March 2025 *Contribution to Group profit before tax 31 March 2024 £m. £m. £m. £m. Poland Office Blue Tower 1 24. 35 30.46 0.97 0.82 Poland Office Gdynia 1 10.04 10.04 (0.21) (0.15) Poland Supermarket Praga 1 2.06 3.14 0.08 0.10 Romania Office Dr Felix 1 2.20 3.43 0.27 0.11 Poland Multi use 5PT 3 8.11 8.97 0.42 0.33 Total* 7 46.76 56.04 1.53 1.21 Property impairment (0.24) (3.75) Reversal of provision in respect of rental guarantee - 0.13 Interest expense (0.69) (0.78) Other overhead costs allocated to the Group Property division (0.65) (0.71) Total contributions to PBT from Group Properties (0.05) (3.90) * Prior to the deduction of direct overhead and unallocated central overhead expenses. Blue Tower, an office building located in Warsaw (in which the Group's 80.3% shareholding totals 18,000 square metres) accounted for £30.46 million (54%) of the Group's seven directly owned properties at market value. The net equity invested in these seven properties totalled £31.67 million at market value, of which £20.34 million (64%) was invested in Blue Tower. The debt secured against six of these seven properties at the year-end totalled £24.37 million (31 March 2024: £27.62 million), of which only £9.45 million was interest bearing. The remainder (£14.92 million) represented deferred consideration liabilities as follows: · €12 million (£10.04 million) in respect of the purchase in 2021 of a 13,000 square metres office block in Gdynia, Poland, for which payment was due in June 2024. After the financial year end the company which owns this property, Fprop Gdynia Sp. Zoo, was placed into administration following failure to agree restructuring terms with its principal creditor. This should have no material impact on the Group since the value of its investment in the property was matched to the value of the debt secured against it. The company operated on a breakeven basis so there should be no material impact on the Group's trading profits. · PLN 24.40 million (£4.87 million) in respect of the purchase in 2022 of an additional 32% or 7,171 square metres in Blue Tower. Payment is due in instalments until August 2028. A total of PLN 16.00 million (£3.20 million) of the original liability has been paid. The next instalment of £1.00 million is due in August 2025. Interest costs on the Group's debt amounted to £0.69 million (2024: £0.78 million). This equates to an average borrowing cost of 2.8% per annum when expressed as a percentage of total outstanding Group debt of £24.37 million, or 7.3% per annum on the debt which is interest bearing. 31 March 2025 31 March 2024 £m. £m. Book value of directly owned properties 46.76 45.76 Market value of directly owned properties 56.04 51.90 Gross debt undiscounted (all non-recourse to the Group) 24.37 27.62 LTV at book value 52.12% 60.36% LTV at market value 43.49% 53.22% Average borrowing cost 2.8% 2.8% At 31 March 2025, the vacancy rate across all seven properties was 29.82%, as measured in terms of square metres. The vacancy rate across the six properties excluding the property in Gdynia was 9.72% and totalled 2,800 square metres. If the vacant space in these remaining six properties is fully let, the net operating income from the Group's directly owned properties should increase by some €0.50 million per annum (£0.42 million per annum). The weighted average unexpired lease term ("WAULT") as at 31 March 2025 was 4 years, 10 months (2024: 4 years, 10 months) across the Group's seven directly held properties. 2. Associates and Investments These comprise non-controlling interests in nine of the eleven funds managed by FPAM of which five are accounted for as Associates and held at the lower of cost or fair value (the "cost model"), and four are accounted for as Investments in funds and held at fair value. The contribution to profit before tax and unallocated central overheads from the Group's Associates and Investments was £3.21 million (31 March 2024: £0.11 million), of which £1.73 million was from the Group's 23% share in FPL. The Group also benefitted from cash distributions of £422,000 (2024: £134,000) from its shareholdings in UK PPP and Spec Opps. In 2024 the Group's share of post-tax profits earned by Fprop Opportunities plc ("FOP") was impacted by an impairment charge of £0.97 million. There was no impairment in 2025, allowing FOP's contribution to improve to £0.94 million (2024: (£0.14) million). The Group's investment in Fprop Krakow Ltd (FKR) suffered an impairment provision of £0.12 million (2024: £0.10 million). A t the year-end the associates and investments were valued at £22.61 million (31 March 2024: £20.26 million). An overview of the Group's Associates and Investments is set out in the table below: Fund % owned by First Property Group Book value of First Property's share in fund Current market value of holdings Group's share of post-tax profits earned by fund 31 March 2025 Group's share of post-tax profits earned by fund 31 March 2024 % £'000 £'000 £'000 £'000 a) Associates (all invested in Poland and Romania) FOP 45.7 13,482 13,482 944 (141) FGC 29.1 3,211 3,962 242 202 FKR 18.1 962 962 (128) (64) FPL 23.4 1,733 1,748 1,733 (60) FCL 21.2 676 781 (2) 41 Sub Total 20,064 20,935 2,789 (22) b) Investments (all invested in the United Kingdom) UK PPP 0.9 25 25 55 23 FULCRUM 1.3 143 143 - 5 SPEC OPPS 11.1 1,158 1,158 367 83 OFFICES 1.6 344 344 - 23 Sub Total 1,670 1,670 422 134 Total 21,734 22,605 3,211 112 Commercial Property Markets Outlook Poland: GDP is expected to grow by around 3% in 2025 and again in 2026, similar to that of 2024. Interest rates were cut by 50bp in May to 5.25%, the first cut since November 2023, and are expected to be cut to 4.5% by the year end. Inflation is running at similar levels. Turnover in Poland's commercial property market in 2024 was around €5 billion, roughly double that recorded in 2023, though some way below the average of €6 billion per annum recorded in previous years. The market is still suffering from a withdrawal of capital and a scarcity of banks willing to lend against property. In general the occupational market is performing better than the investment market, though there exist pockets of oversupply, such as for offices in Krakow. United Kingdom: GDP forecasts for the UK have been lowered for 2025 to around 1%, similar to that achieved in 2024 (0.9%). The economic outlook remains highly uncertain. The base interest rate was cut in May by 0.25% to 4.25%, the second cut of the year (cut in February by 0.25%). The market anticipates further cuts to 3.75% by the end of the year. Inflation remains stubbornly high though at above 3% and above the Bank of England's target level of 2%. All commercial property delivered a total return in 2024 of 7.7%, including from capital value growth of 1.8%. This was higher than in both 2022 and 2023. Rental values rose by 2.9% in 2024. Sentiment in the investment market is improving but the market remains bifurcated with large differences in value between well let modern properties which comply with target net zero legislation, and the rest. Current Trading and Prospects I am pleased to report a material turnaround in the fortunes of the Group. We appear to be close to the bottom of the cycle, following what has been a severe downturn, especially for office properties. The economic outlook remains uncertain and it remains a buyer's market. Even with this uncertain outlook we are seeing interesting deals, some of which we hope to secure. We are treading cautiously but our fortunes have improved and we expect this to continue. Ben Habib Chief Executive 18 June 2025 GROUP FINANCE DIRECTOR'S REVIEW The Group reported a profit before tax for the year to 31 March 2025 of £3.03 million (2024: loss before tax of £4.41 million). The profit was mainly attributable to an increase in the value of the Group's 23% share in Fprop Phoenix Ltd ("FPL") by £1.73 million and cost cutting measures resulting in total annualised savings of around £650,000. A non-cash impairment of £0.24 million (2024: £3.75 million) was recognised in respect of the directly held Group property in Gdynia, Poland. Post year end, the Directors placed the wholly owned subsidiary which owns the property, Fprop Gdynia Sp. Zoo, into administration following failure to agree restructuring terms with its principal creditor. At the year end the value ascribed to this property matched the value of the debt secured against it. The company operated on a breakeven basis so there should be no material impact on the Group's trading profits. During the financial year the Group raised £2.96 million (before expenses) through an open offer of new Ordinary Shares to all qualifying shareholders. The proceeds were used to meet contractual deferred consideration payments of £1.97 million in respect of Blue Tower, an office building located in Warsaw, to fund capital expenditure incentives for tenants of £1.42 million as the Group continues to lease the remaining vacant space in its portfolio, and to strengthen the Group's balance sheet. Group net assets excluding non-controlling interests at 31 March 2025 increased to £45.09 million (31 March 2024: £38.98 million) . Gross debt at the year-end was £24.37 million (31 March 2024: £27.62 million). The decrease was largely due to payments totalling £1.97million of deferred consideration in respect of Blue Tower, bank loan repayments of £0.83 million, and a favourable foreign exchange movement of £0.43 million. Of this gross debt, £14.92 million represented deferred consideration on which no interest is payable. Net debt decreased to £19.55 million (31 March 2024: £22.99 million). GOING CONCERN The Directors are of the view that the Group is a going concern and this is the basis under which these financial statements have been prepared. Analysis and scenario testing was carried out on the Group's main divisional income streams, being fund management fees from the fund management division, rental income from its seven directly owned Group Properties, and cash returns from its Associates and Investments. Further details of this analysis is set out in the "Basis of Preparation" note below. Based on the results of the analysis conducted, the Board believes that the Group has the ability to continue its business for at least twelve months from the date of approval of the financial statements and therefore has adopted the going concern basis in the preparation of this financial information. INCOME STATEMENT A review of the operating and financial performance of the two trading divisions are included in the Chief Executive's Statement. Revenue and Gross Profit Revenue for the year decreased by £0.30 million or 3.8% to £7.55 million (31 March 2024: £7.85 million) driven by a reduction in fund management fee income earned by the Group's managed funds. Gross profit (revenue less the cost of sales) reduced by £0.15 million to £4.82 million ( 31 March 2024: £4.97 million). Operating Expenses Operating expenses decreased by £0.84 million or 16% to £4.32 million ( 31 March 2024: £5.16 million) mainly due to the Group initiating a cost saving program during the year which resulted in annualised cost savings of around £650,000. In addition, the non-cash charge recognised in respect of outstanding share options reduced to £0.29 million (31 March 2024: £0.64 million). See note 7 of the Notes to the Accounts for more information on the share-based payment scheme. Operating expenses included costs of £142,000 in respect of the open offer. Share of Results in Associates The contribution to Group profit from its Associates amounted to £2.79 million ( 31 March 2024: loss of £0.02 million), of which the Group's 23% interest in a managed fund, FPL, contributed £1.73 million. A fair value impairment of £0.44 million in respect of the Group's 45.7% shareholding in FOP, which was recognised in the first half of the financial year, was subsequently reversed by £0.52 million, due to a recovery in property values at the year end (2024: impairment of £0.97 million). An impairment of £0.12 million (2024: £0.10 million) has been charged in respect of the Group's 18.1% holding in FKR . Investment Income (from other financial assets and investments) Investment income from the Group's investments in the UK funds managed by FPAM increased by 223% to £0.42 million (31 March 2024: £0.13 million) largely driven by distributions received from UK PPP and Spec Opps, after the sale of seven properties by these funds during the year. Financing Costs Finance costs decreased to £0.69 million (31 March 2024: £0.78 million). All bank loans are denominated in Euros and all are used to finance properties valued in Euros. STATEMENT OF FINANCIAL POSITION Investment Properties (held using the cost model) The Group adheres to the "cost model" of valuation whereby investment properties are accounted for at the lower of cost less accumulated depreciation and impairments, or at fair market value. The Group owed £10.04 million (€12 million) of deferred consideration in respect of the Group's directly held property in Gdynia, which was due for payment in June 2024. After the financial year end, the company which owns this property, Fprop Gdynia Sp. Zoo, was placed into administration following failure to agree restructuring terms with its principal creditor. This should have no material impact on the Group since the value of its investment in the property was matched to the value of the debt secured against it. The company operated on a breakeven basis so there should be no material impact on the Group's trading profits. At the year end the Group held seven properties directly, including the property in Gdynia. Their book value was £46.76 million (31 March 2024: £45.76 million). Their fair market value was £56.04 million (31 March 2024: £51.90 million). Capital expenditure incurred on the Group's seven directly owned properties amounted to £1.42 million (31 March 2024: £1.67 million). Foreign exchange revaluations resulted in a debit of £0.42 million (31 March 2024: debit £1.17 million). Borrowings Bank and other borrowings, including deferred consideration, decreased by £3.25 million to £24.37 million (31 March 2024: £27.62 million). The decrease was largely due to the payment of deferred consideration of £1.97 million in respect of Blue Tower, capital repayments of £0.83 million in respect of bank loans, and a favourable foreign exchange movement of £0.43 million. The Group's current financial liabilities increased to £16.19 million (31 March 2024: £13.08 million) due to the repayment date of the bank loan secured against Blue Tower reducing to less than one year. We are in the process of negotiating a loan extension. The two loans classified as current liabilities are: 1. deferred consideration of £10.04 million (€12 million) in respect of the property in Gdynia, which was due for payment in June 2024 and which was not paid; and 2. the bank loan of £4.61 million (€5.5 million) in respect of Blue Tower, which is due for repayment on 20 June 2025. The Group is currently in the process of finalising a loan extension with the lender. Both debts are non-recourse to the Group. The ratio of debt to gross assets at their market value (the gearing ratio) decreased to 31.50% (31 March 2024: 38.28%). All bank loans are denominated in Euros and are non-recourse to the Group's assets. Deposits of £0.31 million (31 March 2024: £0.32 million) are held by lending banks as security for Debt Service Cover Ratio (DSCR) covenants in respect of four bank loans (31 March 2024: four). Consequently this cash was restricted as at 31 March 2025. Trade and Other Receivables Trade and other receivables decreased by £0.21 million to £3.94 million (31 March 2024: £4.15 million). Trade and Other Payables Trade and other payables decreased by £1.05 million to £2.74 million (31 March 2024: £3.79 million) due to payment of £1.11 million to OFFICES in respect of profit share previously paid on account and liable to clawback. Non-controlling Interests The value of the Group's two non-controlling interests increased by £0.28 million to £2.23 million (31 March 2024: £1.95 million). The two non-controlling interests are: 1. 10.00% of the share capital of Corp Sp. Zoo, the property management company to Blue Tower; and 2. 52.80% of the share capital of 5th Property Trading Ltd ("5PT"), a fund invested in three commercial properties in Poland. Investment Revaluation Reserve The investment revaluation reserve decreased by £0.26 million to a debit balance of £2.45 million (31 March 2024: £2.19 million). When the four UK fund management mandates to which they pertain expire, the Group will recycle this debit balance from the investment revaluation reserve to the profit and loss account during the financial year in which the funds are wound up. OFFICES (a fund which expired in June 2024) and UK PPP are both in the process of selling their assets and have respective debit balances of £1.08 million and £0.25 million to be released. The remaining reserve balance relates to the Group's investment in SPEC OPPS and FUCLRUM. Foreign Exchange Translation Reserve A strengthening of the Polish Zloty against Sterling to PLN 5.0056 GBP (31 March 2024: PLN 5.0375/ GBP) resulted in a reduction in the deficit in the foreign exchange translation reserve to £0.42 million (31 March 2024: £1.41 million). Cash and Cash Equivalents The Group's cash balance increased to £4.82 million (31 March 2024: £4.63 million). The main inflows were: £2.96 million (before expenses) raised through an open offer of new Ordinary Shares to all qualifying shareholders, £0.70 million of capital repayments received from the Group's investment in UK Funds and £0.24 million of interest income. The main outflows were: £1.97 million of deferred consideration in respect of Blue Tower, £1.42 million of capital expenditure at Blue Tower, £1.11 million of contractual clawback liabilities in respect of the OFFICES fund, and £0.83 million of capital repayments in respect of the Group's bank loans. Laura James Group Finance Director 18 June 2025 CONSOLIDATED INCOME STATEMENT for the year ended 31 March 2025 Notes Year ended 31 March 2025 Unaudited Total results £'000 Year ended 31 March 2024 Audited Total results £'000 Revenue 1 7,552 7,851 Cost of sales (2,728) (2,884) Gross profit 4,824 4,967 Operating expenses (4,317) (5,156) Operating profit/(loss) 507 (189) Share of associates' profit after tax 10 2,827 1,050 Share of associates' revaluation losses 10 (38) (1,072) Investment income 422 134 Interest income 3 245 194 Interest expense 3 (695) (780) Loss from impairment of investment properties 8 (242) (3,746) Profit/(loss) before tax 3,026 (4,409) Tax charge 4 (684) 29 Profit/(loss) for the year 2,342 (4,380) Attributable to: Owners of the parent 2,139 (4,582) Non-controlling interests 203 202 2,342 (4,380) Earnings/(loss) per share: Basic 6 1.65p (4.13p) Diluted 6 1.64p (4.04p) All operations are continuing. CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME for the year ended 31 March 2025 Year ended 31 March 2025 Total results Year ended 31 March 2024 Total results £'000 £'000 Profit/(loss) for the year 2,342 (4,380) Other comprehensive income Items that may subsequently be reclassified to profit or loss Exchange differences on retranslation of foreign subsidiaries 985 946 Net (loss) on financial assets at fair value through other comprehensive income (258) (1,465) Taxation - - Total comprehensive income for the year 3,069 (4,899) Total comprehensive income for the year attributable to: Owners of the parent 2,759 (5,149) Non-controlling interests 310 250 3,069 (4,899) All operations are continuing. STATEMENT OF FINANCIAL POSITION First Property Group plc Registered No. 02967020 As at 31 March 2025 Unaudited 2025 Audited 2024 Notes Group £'000 Group £'000 Non-current assets Investment properties 8 46,759 45,756 Right of use assets 9 - 17 Property, plant and equipment 15 40 Investment in associates 10a) 20,064 17,275 Other financial assets at fair value through OCI 10b) 1,670 2,623 Goodwill 11 153 153 Deferred tax assets 12 1,117 992 Total non-current assets 69,778 66,856 Current assets Current tax assets 170 127 Right of use assets 9 - 51 Trade and other receivables 13 3,939 4,145 Cash and cash equivalents 4,824 4,628 Total current assets 8,933 8,951 Current liabilities Trade and other payables 14 (2,743) (3,788) Provisions (332) (125) Lease liabilities 9 - (52) Financial liabilities 15 (5,143) (832) Other financial liabilities 16 (11,042) (12,244) Current tax liabilities (22) (48) Total current liabilities (19,282) (17,089) Net current assets (10,349) (8,138) Total assets less current liabilities 59,429 58,718 Non-current liabilities Financial liabilities 15 (4,307) (9,690) Other financial liabilities 16 (3,875) (4,851) Lease liabilities 9 - (17) Deferred tax liabilities 12 (3,930) (3,229) Net assets 47,317 40,931 Equity Called up share capital 1,536 1,166 Share premium 8,222 5,635 Share-based payment reserve 1,105 815 Foreign exchange translation reserve (422) (1,407) Purchase of own shares reserve (2,440) (2,440) Investment revaluation reserve (2,451) (2,193) Retained earnings 39,540 37,401 Equity attributable to the owners of the parent 45,090 38,977 Non-controlling interests 2,227 1,954 Total equity 47,317 40,931 Net assets per share 6 30.50p 35.15p CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended 31 March 2025 Group Share capital Share premium Share-based payment reserve Foreign exchange translation reserve Purchase of own shares Investment revaluation reserve Retained earnings Non-controlling interests Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 At 1 April 2024 1,166 5,635 815 (1,407) (2,440) (2,193) 37,401 1,954 40,931 Profit for the year - - - - - - 2,342 - 2,342 Net loss on financial assets at fair value through other comprehensive income - - - - - (258) - - (258) Exchange differences arising on translation of foreign subsidiaries - - - 985 - - - 107 1,092 Change in the proportion held in non-controlling interests - - - - - - - - - Total comprehensive income - - - 985 - (258) 2,342 107 3,176 Share issue 370 2,587 - - - - - - 2,957 Share Options charge - - 290 - - - - - 290 Non-controlling interests - - - - - - (203) 203 - Dividends paid - - - - - - - (37) (37) At 31 March 2025 1,536 8,222 1,105 (422) (2,440) (2,451) 39,540 2,227 47,317 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended 31 March 2024 Group Share capital Share premium Share-based payment reserve Foreign exchange translation reserve Purchase of own shares Investment revaluation reserve Retained earnings Non-controlling interests Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 At 1 April 2023 1,166 5,635 179 (2,353) (2,440) (728) 41,983 2,033 45,475 Profit for the year - - - - - - (4,380) - (4,380) Net loss on financial assets at fair value through other comprehensive income - - - - - (1,465) - - (1,465) Exchange differences arising on translation of foreign subsidiaries - - - 946 - - - 48 994 Change in the proportion held in non-controlling interests - - - - - - - (265) (265) Total comprehensive income - - - 946 - (1,465) (4,380) (217) (5,116) Share options charge - - 636 - - - - - 636 Non-controlling interests - - - - - - (202) 202 - Dividends paid - - - - - - - (64) (64) At 31 March 2024 1,166 5,635 815 (1,407) (2,440) (2,193) 37,401 1,954 40,931 Foreign Exchange Translation Reserve The translation reserve comprises all foreign exchange differences arising from the translation of the financial statements of foreign Group companies. This reserve is non distributable. Share Based Payment Reserve The Group grants certain of its employees' rights to its equity instruments as part of its share-based payment incentive plans. The value of these rights has been charged to the Income Statement and has been credited to the share-based payment reserve (which is a distributable reserve). Purchase of Own Ordinary Shares The cost of the Company's Ordinary Shares purchased by the Company for treasury purposes is held in this reserve. The reserve is non distributable. Investment Revaluation Reserve The change in fair value of the Group's financial assets measured at fair value through Other Comprehensive Income is held in this reserve and is non distributable. CASH FLOW STATEMENTS for the year ended 31 March 2025 2025 2024 Notes Group £'000 Group £'000 Cash flows from operating activities Operating profit/(loss) 507 (189) Adjustments for: Depreciation of property, plant & equipment 24 64 Depreciation of investment property 417 350 Share options charge 290 636 Decrease in trade and other receivables 217 553 (Decrease)/ increase in trade and other payables (506) (759) Other non-cash adjustments 101 (64) Cash generated from operations 1,050 591 Taxes paid (194) (193) Net cash flow from/(used in) operating activities 856 398 Cash flow (used in)/ from investing activities Capital expenditure on investment properties 8 (1,423) (1,670) Purchase of property, plant & equipment (15) (31) Cash paid on acquisition of new subsidiaries - (214) Proceeds from investments in funds 10b) 695 456 Proceeds from investments in associates 10a) - 291 Interest received 3 244 194 Investment income 422 134 Net cash flow (used in)/from investing activities (77) (840) Cash flow (used in)/ from financing activities Gross proceeds from open offer 2,957 - Repayment of bank loans (831) (1,814) Repayment of deferred consideration (1,970) - Interest paid 3 (694) (780) Dividends paid - - Dividends paid to non-controlling interests (37) (64) Net cash flow (used in) financing activities (575) (2,658) Net increase/(decrease) in cash and cash equivalents 204 (3,100) Cash and cash equivalents at the beginning of the year 4,628 7,647 Currency translation gains on cash and cash equivalents (8) 81 Cash and cash equivalents at the year end 4,824 4,628 Notes to the Accounts Basis of Preparation These preliminary financial statements have not been audited and are derived from the statutory accounts within the meaning of section 434 of the Companies Act 2006. They have been prepared in accordance with the Group's accounting policies that will be applied in the Group's annual financial statements for the year-ended 31 March 2025. The policies have been consistently applied to all years presented unless otherwise stated below. These accounting policies are drawn up in accordance with UK-adopted International Accounting Standards ('IFRS'). Whilst the financial information included in this preliminary statement has been prepared in accordance with IFRS, this announcement does not itself contain sufficient information to fully comply with IFRS. The comparative figures for the financial year ended 31 March 2024 are not the statutory accounts for the financial year but are derived from those accounts prepared under IFRS which have been reported on by the Group's auditors and delivered to the Registrar of Companies. The report of the auditors was unqualified, did not include references to any matter to which the auditors drew attention by way of emphasis without qualifying their report and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. Going Concern The Directors have carried out an analysis which supports their view that the Group is a going concern, and under which basis these financial statements have been prepared. Analysis and scenario testing was carried out on the Group's main divisional income streams, being asset management fees from the fund management division, rental income from its seven directly owned Group Properties and cash returns from its associates and investments. a) Fund Management Fee Income Fund management fee income is derived from the Group's UK funds (38%), four of which are limited partnerships whose limited partners are a mix of pension funds and registered charities. Fund management fees are invoiced monthly and are calculated based on a percentage of the latest valuation, which for the UK funds is performed quarterly. Three of the UK funds (following the sale of final remaining properties) will commence the process of being wound up and as a result the Group's management anticipates fund management fees will reduce over the coming twelve months. The anticipated reduction in fund management fees has been included within the forecasts reviewed by the Board as part of the going concern assessment. Fund management fees on the Group's Polish and Romanian managed funds are also levied as a percentage of funds under management, with reference to the most recent valuations. These funds are established under the ownership of a UK limited company which in turn owns the company domiciled in the country that owns the property. Each of these local companies has borrowings secured against the property and is therefore ring fenced from the Group. The longevity of this fund management fee income is determined by the fund's life which is fixed by agreement when each fund is first established. The weighted average unexpired fund management contract term is 3 years, 4 months. At the financial year end, fund management fee income, excluding performance fees, was being earned at an annualised rate of £1.20 million (31 March 2024: £1.83 million). b) Rental Income from Group Properties Six of the seven Group Properties are located in Poland, one in Romania. These properties consist of four office blocks, a mini-supermarket, one multi-let property and ground-floor retail property. All were independently valued on 31 March 2025 at £56.04 million (31 March 2024: £51.90 million). The rental income has been reviewed when setting the forecast revenues and no significant falls in collection rates are expected. The tenants are of good quality, as proven by excellent historic cash collection rates. Any renegotiation of rental payment terms that have been agreed are reflected in the forecasting analysis. On 12 August 2022 the Group acquired 7,171 square meters in Blue Tower, an office building located in Warsaw for PLN 40.40 million (£7.20 million). The purchase resulted in the Group's interest in the building increasing from 48.20% to 80.30%. Some 5,159 square metres of the newly acquired space was vacant at purchase. At 31 March 2025, 2,400 square metres of the Group's interest in Blue Tower remains vacant, if this was leased in full the Group's net operating income would improve by some c€400,000 per annum. Post year end, the Directors placed the wholly owned subsidiary, Fprop Gdynia Sp. Zoo, the company which owns the directly held property in Gdynia, into administration. This was following failure by the company to agree restructuring terms with its principal creditor. At the year end the value of the property held by the company matched the value of the debt secured against it. The company operated on a breakeven basis so there should be no impact on the Group's trading profits. c) Income from Associates and Investments Analysis was also conducted on the Group's investment in its five (31 March 2024: five) Associates. All bank loan covenants were reviewed and tested against future decreases in valuation and net operating income. Dividend income from the Group's UK investments was also stress tested and found not to have a significant impact on revenue. d) Liquidity The Group has two deferred consideration liabilities as follows: · €12 million (£10.04 million) in respect of the purchase in 2021 of a 13,000 square metres office block in Gdynia, Poland, for which payment was due in June 2024. After the financial year end the company which owns this property, Fprop Gdynia Sp. Zoo, was placed into administration following failure to agree restructuring terms with its principal creditor. This should have no material impact on the Group since the value of its investment in the property was matched to the value of the debt secured against it. The company operated on a breakeven basis so there should be no material impact on the Group's trading profits. The debt itself is non-interest bearing and non-recourse to the Group. · PLN 24.40 million (£4.87 million) in respect of the purchase in 2022 of an additional 32% or 7,171 square metres in Blue Tower, an office building located in Warsaw. Payment is due in instalments until August 2028. A total of PLN 16.00 million (£3.20 million) of the original liability has been paid. The debt itself is non-interest bearing and non-recourse to the Group. The next instalment of £1.00 million is due in August 2025 and the Group intends to make this payment from retained cash. The Group monitors overall debt requirements by reviewing current borrowing levels, debt maturity and interest rate exposure. The Group has one bank loan due for repayment on 20 June 2025 which totals £4.61 million. The Group is currently in the process of finalising a loan extension with the current lender. The Group does not have any other debt due for renewal in the next twelve months other than the deferred consideration referred to above. A one percentage point increase in interest rates would increase the annual interest cost by £0.09 million per annum (31 March 2024: £0.11 million). Deposits of £0.31 million (31 March 2024: £0.32 million) are held by lending banks as security for Debt Service Cover Ratio (DSCR) covenants in respect of four bank loans (31 March 2024: four). Consequently this cash was restricted as at 31 March 2025. Going Concern Statement As outlined above, the Board believes that the Group has the ability to continue its business for at least twelve months from the date of approval of the financial statements and therefore has adopted the going concern basis in the preparation of this financial information. New Standards and Interpretations We do not consider there to be any relevant new standards, amendments to standards or interpretations that are effective for the financial year beginning on 1 April 2024 which would have had a material impact on these financial statements. The Group has not adopted any new IFRSs that are issued but not yet effective and it does not expect any of these changes to impact the Group. These preliminary financial statements were approved by the Board of Directors on 18 June 2025. 1. Revenue Revenue from continuing operations consists of revenue arising in the United Kingdom 11% (31 March 2024: 19%), Poland 79% (31 March 2024: 72%) and Romania 10% (31 March 2024: 9%). All revenue relates solely to the Group's principal activities. 2. Segment Reporting 2025 Fund Management Division Group Properties Division Property fund management Group properties Associates and investments Unallocated central overheads Total £'000 £'000 £'000 £'000 £'000 Rental income - 3,578 - - 3,578 Service charge income - 1,712 - - 1,712 Fund management fees 2,262 - - - 2,262 Performance related fee income - - - - - Total revenue 2,262 5,290 - - 7,552 Depreciation and amortisation (15) (9) - - (24) Operating profit 1,040 853 - (1,386) 507 Share of results in associates - - 2,827 - 2,827 Fair value adjustment on associates - - (38) - (38) Property impairment - (242) - - (242) Investment income - - 422 - 422 Interest income - 38 - 207 245 Interest expense - (695) - - (695) Profit/(loss) before tax 1,040 (46) 3,211 (1,179) 3,026 Analysed as: Underlying profit/(loss) before tax before adjusting for the following items: 633 213 1,094 (941) 999 Interest received on loan to associates - - - 207 207 Fair value adjustment on associates - - (38) - (38) Open offer costs - - - (142) (142) Property impairment - (242) - - (242) One-off income generated from an associate 91 - 1,733 - 1,824 One-off distribution income from UK investments following property disposals - - 422 - 422 Payment in lieu of Management Fees due to end of life 300 - - - 300 Share option charge - - - (290) (290) Realised foreign currency (losses)/gains 16 (17) - (13) (14) Total 1,040 (46) 3,211 (1,179) 3,026 Assets - Group 993 50,590 1,670 5,394 58,647 Share of net assets of associates - - 20,064 - 20,064 Liabilities (49) (31,345) - - (31,394) Net assets 944 19,245 21,734 5,394 47,317 Additions to non-current assets Property, plant and equipment - 15 - - 15 Investment properties - 1,423 - - 1,423 Segment Reporting 2024 Fund Management Division Group Properties Division Property fund management Group properties Associates and investments Unallocated central overheads Total £'000 £'000 £'000 £'000 £'000 Rental income - 3,078 - - 3,078 Service charge income - 1,826 - - 1,826 Fund management fees 2,947 - - - 2,947 Performance related fee income - - - - - Total revenue 2,947 4,904 - - 7,851 Depreciation and amortisation (38) (26) - - (64) Operating profit 824 586 - (1,599) (189) Share of results in associates - - 1,050 - 1,050 Fair value adjustment on associates - - (1,072) - (1,072) Property impairment - (3,746) - - (3,746) Investment income - - 134 - 134 Interest income - 36 - 158 194 Interest expense - (780) - - (780) Profit/(loss) before tax 824 (3,904) 112 (1,441) (4,409) Analysed as: Underlying profit/(loss) before tax before adjusting for the following items: 350 (87) 1,184 (1,031) 416 Interest received on loan to associates - - - 158 158 Fair value adjustment on associates - - (1,072) - (1,072) Property impairment - (3,746) - - (3,746) Payment in lieu of Management Fees due to end of life 411 - - - 411 Interest provision - (102) - - (102) Performance related fee income - - - - - Reversal of provision in respect of rental guarantee - 130 - - 130 Share option charge - - - (636) (636) Realised foreign currency (losses)/gains 63 (99) - 68 32 Total 824 (3,904) 112 (1,441) (4,409) Assets - Group 515 49,869 2,623 5,525 58,532 Share of net assets of associates - - 17,275 - 17,275 Liabilities (56) (34,820) - - (34,876) Net assets 459 15,049 19,898 5,525 40,931 Additions to non-current assets Property, plant and equipment - 31 - - 31 Investment properties - 1,670 - - 1,670 3. Interest Income/(Expense) 2025 2024 Group £'000 Group £'000 Interest income - bank deposits 104 62 Interest income - other 140 132 Total interest income 244 194 2025 2024 Group £'000 Group £'000 Interest expense - property loans (617) (761) Interest expense - bank and other (77) (19) Total interest expense (694) (780) 4. Tax Expense 2025 Group £'000 2024 Group £'000 Analysis of tax charge for the year Current tax (127) (244) Deferred tax (557) 273 Total tax charge for the year (684) 29 The tax charge includes current and deferred tax for continuing operations. As in prior years, brought forward and current UK tax losses have not been recognised as a deferred tax asset due to insufficient foreseeable taxable income being earned in the UK. 5. Called up Share Capital 2025 2024 Group £'000 Group £'000 Authorised 240,000,000 (2024: 240,000,000) Ordinary Shares of 1 pence each 2,400 2,400 Issued and fully paid 153,561,892 (2024: 116,601,115) Ordinary Shares of 1 pence each of issued share capital, of which 5,718,783 Ordinary Shares (2024: 5,718,783) are held in treasury 1,536 1,166 Ordinary Shares Number Treasury Shares Number Share Options Number 1 April 2024 110,882,332 5,718,783 12,560,000 Purchase of shares into treasury - - - Exercise of share options - - - Issue of new Ordinary Shares 36,960,777 - - Issue of share options - - - Lapse of share options - - - 31 March 2025 147,843,109 5,718,783 12,560,000 During the year the Group undertook an open offer to issue new Ordinary Shares open to all qualifying shareholders. Priced at 8 pence per open offer share. The open offer raised £2.96 million (before related expenses) and resulted in the issue of 36,960,777 new Ordinary Shares. The net proceeds from the open offer provided the Group with additional working capital to, inter alia, settle the deferred consideration payment due on the Blue Tower property and to complete its fit-out works following the signing of a new lease, as announced on 25 July 2024. 6. Earnings/(Loss) /NAV per Share 2025 2024 Basic earnings/(loss) per share 1.65p (4.13p) Diluted earnings/(loss) per share 1.64p (4.04p) The following earnings/(losses) have been used to calculate both the basic and diluted earnings/(loss) per share: £'000 £'000 Basic earnings/(loss) 2,139 (4,582) Notional interest on share options assumed to be exercised 3 16 Diluted earnings/(loss) assuming full dilution 2,142 (4,566) The following numbers of shares have been used to calculate the basic and diluted earnings/(loss) per share: 2025 Number 2024 Number Weighted average number of Ordinary shares in issue (used for basic earnings/(loss) per share calculation) 130,020,926 110,875,483 Number of share options 500,000 2,110,000 Total number of Ordinary shares used in the diluted earnings/ (loss) per share calculation 130,520,926 112,985,483 For the purpose of calculating diluted earnings/(loss) per share, the number of Ordinary Shares is the weighted average number of Ordinary Shares, plus the weighted average number of Ordinary Shares that would be issued on the conversion of all the dilutive potential Ordinary Shares into Ordinary Shares. Options have a dilutive effect only when the average market price of the Ordinary Shares during the period exceeds the exercise price of the options and thus they are 'in the money'. 2025 2024 Net assets per share 30.50p 35.15p Adjusted net assets per share 35.72p 39.41p The following numbers have been used to calculate both the net assets and adjusted net assets per share: 2025 2024 £'000 £'000 For net assets per share Net assets excluding non-controlling interests 45,090 38,977 Number of shares Number Number Number of shares in issue at the year end 147,843,109 110,882,332 Number of share options assumed to be exercised 500,000 2,110,000 Total 148,343,109 112,992,332 The adjusted net assets is a measure based on IFRS net assets to include the fair value of i) financial instruments, ii) debt and iii) deferred taxes. The metric adjusts for the dilutive impact of share options. £'000 £'000 For adjusted net assets per share Net assets excluding non-controlling interests 45,090 38,977 Uplift of investment properties at fair value net of deferred tax 6,966 4,872 Uplift of investments in associates and other financial investments to fair value 872 362 Other items 58 323 Total 52,986 44,534 Adjusted net assets per share are calculated using the fair value of all investments. 7. Share Based Payments The Company has one share-based payment arrangement scheme in place which is described below: Date of grant 31 March 2023 Number granted 10,450,000 Contractual life 10 years to 31 March 2033 Vesting conditions The options vest as follows: · 33.3% on the first anniversary of grant; · 33.3% on the second anniversary of grant; and · the remainder on the third anniversary of grant. The estimated fair value of each share option granted has been calculated using the Black-Scholes pricing model. The model inputs were the share price at grant date and the exercise price based on the mid- market closing price on 30 March 2023 of 23.5 pence per Ordinary Share, expected volatility of 30%, a dividend yield of 1%, a contractual life of ten years and a risk-free interest rate of 4.25%. 2025 2024 Group £'000 Group £'000 Expenses arising from share based payments 290 636 8. Investment Properties 2025 2024 Group £'000 Group £'000 Investment properties At 1 April 45,756 47,009 Property impairment (242) (3,746) Capital expenditure 1,423 1,670 Depreciation (417) (350) Foreign exchange translation 239 1,173 At 31 March 46,759 45,756 At the year end the Group held seven properties. Investment properties owned by the Group are stated at cost less depreciation and any accumulated impairment in value. The properties were valued at the Group's financial year end at €66.97 million (31 March 2024: €60.72 million), the Sterling equivalent at closing foreign exchange rates being £56.04 million (31 March 2024: £51.90 million). The Group owes £10.04 million (€12 million) of deferred consideration in respect of the purchase in 2021 of a 13,000 square metres office block in Gdynia, Poland, for which payment was due in June 2024. In view of the non-payment of this liability and the uncertainty over its future, the Directors impaired the value of the property by £0.24 million (2024: £3.75 million) to match its value to the value of the €12 million liability. The property was independently valued at 31 March 2025 at €15.73 million with an enforced sales value of €12 million. After the financial year end the company which owns this property, Fprop Gdynia Sp. Zoo, was placed into administration following the failure to agree restructuring terms with its principal creditor. This should have no material impact on the Group since the value of its investment in the property is matched to the value of the debt secured against it. The company operated on a breakeven basis so there should be no material impact on the Group's trading profits. The debt itself is non-interest bearing and non-recourse to the Group. Amounts recognised in the income statement: 2025 2024 Group £'000 Group £'000 Rental income from operating leases 3,578 3,078 i. Leasing arrangements where the group is a lessor: 2025 2024 Group £'000 Group £'000 Minimum lease receipts under non-cancellable operating leases to be received: Not later than one year 3,422 2,569 Later than one year and not later than five years 7,084 7,043 Later than five years 3,747 4,610 14,253 14,222 Investment properties comprise commercial properties leased to approximately 75 tenants. The leases vary but typically are for five years. The weighted average lease length was 4 years and 10 months (31 March 2024: 4 years and 10 months). No contingent rents are charged. 9. Right of Use Assets and Lease Liabilities This note provides information for leases where the Group is a lessee. For leases where the Group is a lessor, see note 8. The amounts recognised in the financial statements in relation to the leases are as follows: i. Amounts recognised in the Balance Sheet: 2025 £'000 2024 £'000 Right of use assets Current - 51 Non-current - 17 2025 £'000 2024 £'000 Lease Liabilities Current - 52 Non-current - 17 ii. Amounts recognised in the Income Statement: 2025 2024 £'000 £'000 Depreciation/ Rent charge of right-of use-assets Buildings 68 977 68 977 2025 2024 £'000 £'000 Interest expense Buildings 68 1,059 68 1,059 iii. Summary of the Group's leasing activity: The Group has reviewed the terms of its leases and has identified only one remaining lease, it being in respect of the Group's headquarters in the UK, located on 32 St. James's Street, London, SW1A 1HD. This lease is due to expire in July 2025. The Group is at an advanced stage in negotiations to extend this lease. As at 31 March 2025 the Group recognised a lease liability under IFRS 16 of £nil (31 March 2024: £0.07 million) and a right of use asset of £nil (31 March 2024: £0.07 million). The net credit to the Income Statement was £488. Rental contracts are typically made for fixed periods of six months to four years but may have extension options. 10. Investment in Associates and Other Financial Assets and Investments The Group has the following investments: 2025 2024 Group £'000 Group £'000 a) Associates At 1 April 17,275 17,588 Shareholder loan repayments - (291) Share of associates' profit after tax 2,827 1,050 Share of associates' revaluation (losses) (38) (1,072) At 31 March 20,064 17,275 The Group's investments in associated companies are accounted for under the "cost model" under IAS40 whereby the Group's share is held at cost plus its share of subsequent accumulated profits less dividends received. It comprises the following: 2025 2024 Group £'000 Group £'000 Investment in associates FGC 3,211 2,968 FKR 962 1,090 FCL 676 678 FPL 1,733 - FOP 13,482 12,539 20,064 17,275 If the Group had adopted the alternative "fair value" model for accounting for investment properties, the carrying value of the investments in the five associates would be £20.94 million (31 March 2024: five associates £17.64 million). 2025 2024 Group £'000 Group £'000 b) Other financial assets and investments At 1 April 2,623 4,544 Additions - - Disposals - - Repayments (695) (456) Decrease in fair value during the year (258) (1,465) At 31 March 1,670 2,623 The Group holds four (31 March 2024: four) unlisted investments in funds managed by it. Each is designated at fair value through "Other Comprehensive Income" (OCI) as per IFRS 9. The Directors consider their fair value to be not materially different from their carrying value. Fair value has been calculated by applying the Group's percentage holding in the investments to the fair value of their net assets. 11. Goodwill 2025 2024 Group £'000 Group £'000 At 1 April 153 153 At 31 March 153 153 The Directors have conducted an annual impairment test and concluded that no impairment was necessary because the estimated value in use was higher than the value stated. 12. Deferred Tax Deferred tax assets and liabilities are attributable to the following items: 2025 2025 2025 2024 2024 2024 Group net assets £'000 Group assets £'000 Group liabilities £'000 Group net assets £'000 Group assets £'000 Group liabilities £'000 Accrued interest payable 214 214 - 182 182 - Accrued income (7) 11 (18) (14) - (14) Foreign bank loan (590) 147 (737) (539) 153 (692) Investment properties (2,431) 446 (2,877) (1,817) 496 (2,313) Other temporary differences 1 299 (298) (49) 161 (210) At 31 March (2,813) 1,117 (3,930) (2,237) 992 (3,229) 13. Trade and Other Receivables 2025 2024 Group £'000 Group £'000 Current assets Trade receivables 1,312 2,077 Less provision for impairment of receivables (109) (220) Trade receivables (net) 1,203 1,857 Other receivables 1,948 1,804 Prepayments and accrued income 788 484 At 31 March 3,939 4,145 14. Trade and Other Payables 2025 2024 Group £'000 Group £'000 Current liabilities Trade payables 1,839 2,040 Other taxation and social security 178 226 Other payables and accruals 631 1,405 Deferred income 95 117 At 31 March 2,743 3,788 15. Financial Liabilities 2025 Group £'000 2024 Group £'000 Current liabilities Bank loans 5,143 832 At 31 March 5,143 832 Non-current liabilities Bank loans 4,307 9,690 At 31 March 4,307 9,690 2025 Group £'000 2024 Group £'000 Total obligations under bank loans Repayable within one year 5,143 832 Repayable within one and five years 3,218 6,948 Repayable after five years 1,089 2,742 At 31 March 9,450 10,522 Four bank loans all denominated in Euros and totalling £9.45 million (31 March 2024, four bank loans: £10.52 million), included within financial liabilities, are secured against investment properties owned by the Group. The reduction was largely due to capital repayments totalling £0.83 million and a favourable foreign exchange movement of £0.24 million. These bank loans are otherwise non-recourse to the Group's assets. The interest rate profile of the Group's financial liabilities at 31 March 2025 and 31 March 2024 was as follows: Interest bearing £'000 Non- interest bearing £'000 Total £'000 Bank loans 9,450 - 9,450 Other financial liabilities - 14,917 14,917 At 31 March 2025 9,450 14,917 24,367 Bank loans 10,522 - 10,522 Other financial liabilities - 17,095 17,095 At 31 March 2024 10,522 17,095 27,617 A one percentage point increase in interest rates would increase the annual interest bill by £0.09 million per annum (2024: £0.11 million). 16. Other Financial Liabilities 2025 Group £'000 2024 Group £'000 Current liabilities 11,042 12,244 Non-current liabilities 3,875 4,851 2025 Group £'000 2024 Group £'000 Total obligations under Other Financial Liabilities Repayable within one year 11,042 12,244 Repayable within one and five years 3,875 4,851 Repayable after five years - - At 31 March 2025 14,917 17,095 Current liabilities include the balance of £10.04 million (€12 million) in respect of the purchase in 2021 of a 13,000 square metres office block in Gdynia, Poland, for which payment was due in June 2024. After the financial year end the company which owns this property, Fprop Gdynia Sp. Zoo, was placed into administration following the failure to agree restructuring terms with its principal creditor. This should have no material impact on the Group since the value of its investment in the property was matched to the value of the debt secured against it. The company operated on a breakeven basis so there should be no material impact on the Group's trading profits. The debt itself is non-interest bearing and non-recourse to the Group. During the year Sterling strengthened against the Euro by 2.15% which reduced the Group's liability in respect of the property by £0.21 million. Other financial liabilities also includes £4.87 million (PLN 24.40 million) of deferred consideration for the Group's purchase in 2022 of an additional 32% or 7,141 square metres in Blue Tower, an office building located in Warsaw. Payment is due in instalments until August 2028. The debt itself is non-interest bearing and non-recourse to the Group. The next instalment of £1.00 million is due in August 2025 and the Group intends to make this payment from retained cash. During the year to 31 March 2025 Sterling weakened against the Polish Zloty by 0.6% which increased the Group's liability in respect of Blue Tower by £0.04 million. The preliminary results are being circulated to all shareholders and can be downloaded from the Company's web-site ( www.fprop.com ). Further copies can be obtained from the registered office at 32 St James's Street, London, SW1A 1HD.
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