REG - Litigation Cap. Mgmt - Annual Results for the year ended 30 June 2025
Wed 07:00
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RNS Number : 5822B Litigation Capital Management Ltd 01 October 2025
1 October 2025
Litigation Capital Management Limited
("LCM" or the "Company")
Full year audited results for the year ended 30 June 2025
Highlights
• Net realised gains of A$22.2m (FY24: A$23.0m), with concluded case
investments generating a 1.8x multiple of invested capital (MOIC)
• Total loss of A$82.0m (FY24: Total income of A$44.7m) following a number of
trial losses, several of which are under appeal
• Loss after tax for the period of A$72.9m (FY24: Profit after tax of A$12.7m)
• Net assets of A$114.4m (FY24: A$188.9m)
• Total new commitments of A$79m added in the period (FY24: A$279m)
Strategic Update
• Strategic review commenced
• Strategic options to be benchmarked against lean run-off operating model
Commenting on the results, Patrick Moloney, CEO of Litigation Capital
Management, said: "The last 12 months have been the most challenging in LCM's
history as we experienced a series of adverse case outcomes impacting our
financial performance. These setbacks, while disappointing, have underscored
the inherent risks of our asset class and the lessons we have learned are
shaping our path forward. Our team's resilience and decisive actions,
including significant cost reductions and a refocused investment strategy,
have laid a foundation for recovery. Looking ahead, we are committed to
restoring LCM's track record of delivering value through a reinvigorated focus
on active management of case investments, a cornerstone of our historical
success."
Analyst and investor presentation
The Company will also be hosting a live presentation for all existing and
potential shareholders via the Investor Meet Company at 14:00 BST today. If
you would like to attend this presentation, please register using the
following link:
https://www.investormeetcompany.com/litigation-capital-management-limited/register-investor
(https://www.investormeetcompany.com/litigation-capital-management-limited/register-investor)
The presentation is open to all existing and potential shareholders. Investors
who already follow LCM on the Investor Meet Company platform will
automatically be invited.
Enquiries
Litigation Capital Management
Patrick Moloney, Chief Executive Officer
David Collins, Chief Financial Officer
Cavendish (Nomad and Joint Broker) Tel: 020 7523 8000
Jonny Franklin-Adams and Isaac Hooper (Corporate Finance)
Tim Redfern and Jamie Anderson (Corporate Broking)
NOTES TO EDITORS
Litigation Capital Management (LCM) is an alternative asset manager
specialising in disputes financing solutions internationally, which operates
two business models. The first is direct investments made from LCM's permanent
balance sheet capital and the second is third party fund management. Under
those two business models, LCM currently pursues three investment strategies:
Single-case funding, Portfolio funding and Acquisitions of claims. LCM
generates its income from both its direct investments and also performance
fees through asset management.
LCM has an unparalleled track record driven by disciplined project selection
and robust risk management. Currently headquartered in Sydney, with offices in
London and Singapore, LCM listed on AIM in December 2018, trading under the
ticker LIT.
www.lcmfinance.com (http://www.lcmfinance.com/)
CEO Report
This year has been the most challenging in LCM's history. Despite our
established long-term track record of successful outcomes and consistent
returns on invested capital, an unprecedented number of adverse case results
have negatively impacted our performance over the past 12 months. We
recorded 6 wins against 6 losses in FY25, with a further 3 cases losing at
trial during the period and now being under appeal. Disappointingly, several
of the adverse outcomes were for cases where we had invested significant
shareholder capital. While these results are reflective of the inherent
binary risk in our asset class, they have fallen well short of our
expectations and historical benchmarks.
Post-year-end, we announced the termination of our investment in the Gladstone
class action in Australia, which was initiated in 2018. In our view, the
expert evidence was insufficient to support the case theory and we therefore
took the difficult decision to terminate rather than incur significant further
trial-related costs. The settlement includes payment of costs, fully covered
by After-the-Event Insurance, and we are pursuing potential recoveries through
a costs assessment and a negligence claim against the initial solicitors.
While these setbacks have tested our resilience, they have also provided
valuable insights. We are committed to applying the lessons learned to
strengthen our operations, refine our strategy, and reposition LCM for
long-term recovery.
Lessons Learned
As LCM has grown, expanded internationally, and transitioned into a funds
management business, my role as CEO has evolved to meet the demands of this
transformation. Previously centred on managing legal investments through daily
engagement with solicitors, barristers, and independent experts, my focus has
shifted toward driving strategic expansion. This has involved working closely
with investment bankers, financial intermediaries, and capital providers to
position LCM for long-term success in the funds management space.
This strategic shift has been instrumental in enabling LCM's transition to a
funds management model, where we have raised significant private capital to
fuel growth. To support this evolution, we strengthened our team by recruiting
highly skilled legal professionals from leading law firms and litigation
funders to oversee day-to-day investment management. While their expertise has
been invaluable, I recognise that our approach to investment management may
not have fully sustained the proactive and tenacious rigor that defined LCM's
earlier success.
In recent years, our investment management strategy may have, at times,
aligned more closely with the industry's standard lawyer-led approach. Unlike
many of our single-case peers, LCM's historical strength has been our
hands-on, active investment management, which has driven superior outcomes.
Reflecting on this, I see an opportunity to reinvigorate our unique approach
to ensure we return to delivering attractive multiples on invested capital.
In my view, without genuinely active investment management, it is very
difficult to deliver attractive returns in this asset class-despite it having
appealing characteristics, such as being uncorrelated to broader economic
cycles and offering the potential for significant returns when good
investments are selected and managed appropriately.
LCM's historic success was built on our unique approach to active investment
management, particularly due to our origins in the Australian market, where
funders can contribute to case strategy. I am now entirely focussed on
returning to the area where I believe I can add the most value: the hands-on
rigour of active investment management.
I have already initiated actions on the existing portfolio to proactively
realign it. I am doing so, working alongside two key colleagues with whom I
have collaborated for over a decade and with whom I built our previously
industry-leading track record.
This review of the portfolio and of recent losses has led to a number of
conclusions and subsequent actions including:
· Decisive Action on Underperforming Investments: In good faith, we
have attempted to salvage challenged investments by injecting additional
resources such as enhancing legal teams. In hindsight, this has at times led
to escalating commitments, especially in larger legacy positions, leading to
suboptimal capital allocation. Going forward, we will emphasize rapid
evaluations and timely exits where warranted to preserve capital.
· Managing Concentration Risk: This challenge is interconnected
with delayed action on underperformers, allowing certain positions to become
disproportionately large. We are dedicated to mitigating future risks
through balanced investment sizing, fostering optimal risk-adjusted returns.
· Enhanced Scrutiny of Expert Evidence: A recurring factor in
recent losses has been insufficient critical evaluation of expert reports, as
case lawyers often lack the quantitative expertise to challenge them
effectively. To counter this, we are instituting a more rigorous due diligence
process, including engagement of independent quantitative specialists and
integration of advanced analytical tools early in case assessments. This will
ensure evidence is thoroughly vetted, minimizing the impact of flawed damages
assumptions.
Strategic Review
In the second half of FY25, following our series of losses and the resulting
higher leverage position, we intensified efforts to explore strategic options.
We have proactively engaged with a diverse range of counterparties to assess
potential transactions, including capital raises, strategic partnerships, and
asset sales. These discussions have generated some promising leads.
To advance these opportunities in a structured manner, we appointed Luminis
Partners as our independent financial advisor. The strategic review is now
well progressed, with advanced discussions underway with a number of
counterparties.
Furthermore, our dialogue with our lender has been constructive. Considering
the recent adverse case results that LCM has experienced, we have been in
discussions with the lender for a period of time. Based on these discussions,
we understand that the lender's current intention is to continue to support
LCM for the next 12 months as the management team completes the strategic
review. The lender's intention is subject to ongoing review and may be
reconsidered in light of future developments or changes in LCM's
circumstances.
As well as considering external opportunities, we are also repositioning the
business organically to put us on a sustainable footing. This encompasses a
transition to a run-off model with a concentrated effort to manage our
existing investments to realise value for shareholders. Consistent with this
plan, we have taken significant action on our cost base, reducing our
operating expenses by half, and with the scope for further meaningful
reductions as we reposition our investment management approach.
Dubai
It was reported in May 2025 by one publication that Dubai prosecutors were
formally probing London-listed Litigation Capital Management (LCM) of
corruption offences, alongside its CEO Patrick Moloney. This included money
laundering. It was subsequently reported by the same publication that Dubai
prosecutors had formally accused London-listed Litigation Capital Management
(LCM) of such corruption offences. LCM made it clear immediately it had never
been contacted about such a case, and was not aware of any such investigation
or formal allegations. Rumours of the probe had evidently been circulating in
certain areas of the disputes sector by late 2024 the publication reported.
While LCM has been fully exonerated in this matter, the process has clearly
negatively impacted the company, affecting multiple key business areas and
restricting strategic opportunities that were advanced at the time including
the anticipated first close of Fund III. In our view, it cannot be disputed
that this was entirely avoidable if LCM had been approached at an early state
of any investigation, rather than finding out about this process from a press
leak. Such approach would have made it clear to the relevant UAE authorities
that LCM had absolutely no case to answer as has now formally been confirmed,
and the investigation was entirely ill conceived and potentially malicious.
Due process was not followed and the financial impact has been significant.
We are actively reviewing our legal options to ensure the company can be
compensated to the full extent possible.
In May, we addressed online press speculation regarding a potential
investigation against the Company by a Dubai legal authority. We have since
been notified that the investigation has concluded, with all allegations
against LCM and myself fully dismissed. Furthermore, we understand that the
dismissal includes a scathing verdict highlighting a complete lack of due
process in the investigation, which led to the baseless allegations that were
improperly leaked to the press.
The wholly unacceptable disclosure of this matter through media channels,
rather than through official communication from the Dubai authorities, caused
profound disruption to LCM's operations. This forced us to pause critical
initiatives and pivot to alternative strategies. Notably, we were compelled to
suspend fundraising for Fund III, which was on the cusp of a first close in
early May. Additionally, preliminary discussions for a strategic review-later
announced in September-were significantly delayed. This unwarranted
postponement has materially undermined LCM's negotiating position and
significantly hindered our ability to advance key strategic objectives.
Looking Forward
Through the actions we are taking, we are dedicated to restoring profitability
and delivering value to shareholders. I extend my sincere appreciation to our
dedicated team and loyal investors for their support during this trying time.
Chairman's Statement
Dear Shareholder,
In reviewing the past financial year I acknowledge the significant challenges
LCM has encountered. FY25 has been the most difficult year in the company's
history marked by an unprecedented number of case losses that have adversely
affected our financial performance and cash flows. Despite these setbacks, our
team has demonstrated resilience, taking decisive actions to stabilise the
business amid near-term pressures from elevated debt levels. We remain
committed to our long-term vision while prioritising financial stability.
To address these challenges we have right-sized operations, significantly
reducing operating expenses through disciplined cost management. This included
difficult decisions such as reducing headcount, carefully evaluating our
overheads, and streamlining processes to enhance efficiency without
compromising our core capabilities. New commitments were scaled back as we
focused on high-quality opportunities and capital preservation, ensuring
resources are allocated to deliver maximum value. Additionally, we conducted a
thorough review of our fair value accounting, introduced two years ago, and
adopted a more conservative approach in light of recent disappointing results.
The financial strain from case losses and reduced cash realisations increased
our reliance on our debt facility. As a result, the Board has made the prudent
decision to not pay a dividend, redirecting our focus to strengthening the
balance sheet. These measures, though challenging, are critical to securing
LCM's financial position and laying the groundwork for future stability. The
binary nature of our investments means that in light of our increased
indebtedness there is a risk that in certain circumstances, further case
losses could lead to a breach of LCM's debt covenants. As a result, we are
reporting a material uncertainty in relation to our going concern status
(further detail on page 39). The management team have been proactively
engaging with the lender over the last few months. The lender has indicated
that its current intention, which is subject to ongoing review and may be
reconsidered in light of future developments or change in LCM's circumstances,
is to continue to support LCM for the next 12 months as we advance the
strategic review announced on 15 September 2025.
Looking ahead we are now focused on completing the strategic review,
evaluating all options to realise value for shareholders. These options will
be benchmarked against a lean run-off model, which would involve further
reductions in operating expenses and a shift to managing our existing
portfolio of assets through to conclusion. Under this model, proceeds from
successful case investments would be prioritised to reduce debt, with the
long-term goal of delivering value for shareholders. We are committed to
executing this review with rigour and transparency, keeping you informed as we
shape the company's path forward.
This year also marked the departure of Gerhard Seebacher from the Board after
over four years of service as a Non-Executive Director. Gerhard brought
valuable expertise in financial services and fund management, contributing to
our strategic discussions and governance. On behalf of the Board, I would like
to thank Gerhard for his guidance during his tenure, and we wish him well in
his future endeavours.
I am deeply grateful to our team for their unwavering commitment during this
challenging period. I also extend my thanks to our shareholders for your
continued support and trust, which are vital to our ongoing efforts.
We will keep you informed of our progress in the year ahead.
Jonathan Moulds
Non-Executive Chairman
Finance Review
Income Statement (A$'m) - LCM Only FY25 FY24
Concluded investments - Proceeds on LCM capital 36.6 31.3
Concluded investments - Performance fees on 3P capital 13.1 12.7
Concluded investments - LCM capital invested ("Cost") (27.5) (21.0)
Net realised gains from concluded investments 22.2 23.0
Litigation service revenue / (loss) (5.5) 9.2
Fair value movement:
Fair value removal for concluded investments (49.0) (33.0)
Fair value write-down on case losses under appeal (44.5) -
Net fair value movement on pre-hearing/trial ongoing investments and FX (6.6) 45.4
Net fair value movement (100.1) 12.5
Other income 1.4 -
Total income / (loss) (82.0) 44.7
Operating expenses (18.0) (19.0)
FX gains/losses 5.7 0.5
Operating profit (94.4) 26.3
Finance costs (7.3) (10.2)
Profit before tax (101.7) 16.1
Tax 28.8 (3.3)
Net income (72.9) 12.7
Basic EPS (cents) (70.83) 12.01
Diluted EPS (cents) (70.83) 11.33
Investments that realised in the period generated a 1.8x multiple of invested
capital (MOIC) for LCM. Those realisations included six wins and six losses,
with the positive performance primarily driven by the arbitration win for
funded party, Green-X Metals Limited, against the State of Poland,
contributing A$26.1 million of net realised gains, and an arbitration claim
against Tanzania contributing A$12.0 million of net realised gains. Those
successful cases were offset by losses, the detail being set out in the table
below.
Three cases with total LCM invested capital of A$45.1 million lost at trial
and are either under appeal or seeking permission to appeal.
Realised Wins Invested capital Proceeds MOIC
(incl perf fee)
Australia Insolvency 1.0 1.9 1.9
Treaty Arbitration 1.5 13.5 9.0
US Insolvency 0.2 0.3 1.5
Treaty Arbitration 4.5 30.6 6.8
UK Litigation 0.2 0.4 2.0
Australia Insolvency 0.2 0.9 4.5
Total realised gains 7.6 47.6 6.3
Realised Losses
UK litigation 6.7 0.0 0.0
UK Class Action 1.0 0.0 0.0
US IP 4.5 0.0 0.0
Competition 1.9 0.0 0.0
Competition 1.7 0.0 0.0
Commercial Arbitration 2.6 0.0 0.0
Total realised Losses 18.4 0.0 0.0
Partial Realisations 1.7 2.2
Total 27.5 49.7 1.8
Losses under appeal Invested capital Proceeds (incl perf fee) MOIC
Aus class action 26.1 0.9 0.0
Aus class action 13.7 - 0.0
UK commercial arbitration 5.3 - 0.0
Total Losses under appeal 45.1 0.9 0.0
Note: Above figures are on an LCM only basis
The Litigation service revenue / (cost) line in the above P&L captures the
results for the small number of cases that are held at contract cost under
AASB 15 (as opposed to fair value accounting under AASB 9). One of the cases
that is accounted for under AASB 15 lost at trial during the period and is
being appealed. We are now taking the approach of holding such cases within
a range of 50-60% of cost (see further detail below) as opposed to the prior
approach of holding such losses under appeal at cost. That is the reason for
the litigation service loss in the period (writedown of asset value to below
cost). The prior period included a successful resolution of one of the cases
held under AASB 15 which produced the positive revenue figure.
The net fair value movement in the period was negative at A$100.1m (FY24:
positive A$12.5 million) and this is broken down into three components
described below.
The first component is the fair value removal for investments that concluded
in the period. As investments conclude we remove the fair value held against
them (via this line) and replace that value with the actual result realised
(in Net realised gains section of the P&L). Therefore, this line item
will likely be negative each time we report, reflecting the removal of the
fair value uplift on cases that concluded in the period.
Thus, all of the investments that realised in the period were held at a
cumulative fair value of A$76.6 million (FY24: A$54.7 million) prior to
realisation, being the cumulative fair value uplift of those investments
(A$49.0 million; FY24 A$30.9 million) plus the capital invested into them
(A$27.5 million; FY24 A$23.8 million). That fair value prior to realisation
was equal to a multiple of cash invested of 2.8x.
The proportion of losses in the period being much higher than LCM's long-term
average is a key reason why the realised MOIC (1.8x) on concluded cases is
lower than their fair value MOIC prior to realisation (2.8x).
The second component of the fair value movement relates to two cases that lost
at trial during the period and are being appealed. Our previous approach to
accounting for cases that lost and are under appeal was to hold such
investments at cost until the outcome of the appeal. In light of the series
of losses that LCM has experienced in the last 12 months we have adopted a
more conservative approach to valuing cases under appeal. Going forward, we
will hold such cases at a value of between 50% and 60% of cost until the
outcome of the appeal. This reflects that while the investment that was made
to finance the first trial is still recoverable in the event of a successful
appeal, the value of that asset today should be impaired to reflect the
negative setback associated with the trial loss.
The total writedown on the two cases that lost and are under appeal was A$44.5
million, comprising A$29.0 million to remove the fair value uplift on those
cases prior to appeal and a further A$15.6 million to move their valuations
below cost to within the 50-60% of cost range.
The third component of the fair value movement, being the remaining fair value
movements on ongoing case investments was a loss in the period of A$6.6
million (FY24: a gain of A$43.3 million). This loss has emerged as a result
of a review of the fair value model that has been conducted in light of the
recent disappointing case results. Two years after fair value accounting was
first introduced and after the recent run of adverse case outcomes, the Board
deemed it prudent for the Chief Financial Officer to reassess the fair value
model, incorporating recent experience and his insights gained after more than
12 months in the role.
The review of the fair value assumptions highlighted a number of areas
requiring enhancement. Expected profit assumptions have been lowered for a
number of group claims (such as class actions) reflecting recent industry
experience; duration assumptions have been modestly lengthened also
reflecting recent experience; and the risk adjustment factors within the model
have been adjusted to slow the rate of fair value recognition as a case passes
through the different stages of proceedings as we aim to ensure that
incremental fair value is only recognised when there has been clear and
demonstrable evidence of meaningful case progress.
The changes that have been made to the fair value assumptions result in lower
fair values at the end of the period and what will be a more conservative rate
of fair value recognition going forward. After these assumption changes,
ongoing cases (excluding the three cases that are accounted for at historical
cost) are valued at 1.3x cash invested at the end of the period.
It is important to note that valuing LCM's investments is a subjective and
difficult exercise due to the binary nature of the investments and we expect
that enhancements to the fair value model will be a continuous process as LCM
and the wider industry gains more case experience. The binary outcome nature
of LCM's single case investments means that actual realised outcomes can
differ significantly to the fair value those investments are held at prior to
conclusion.
The above factors have led LCM to report a total loss in the period of A$82.0
million (FY24: A$44.7 million total income).
Operating expenses declined to A$18.0 million from A$19.0 million in the prior
period. Management started taking action to reduce the cost base in the
latter part of the second half and following further actions taken post period
end we have significantly reduced the cost base to an annual rate of around
half the equivalent rate from 12 months ago and this reduction will come
through visibly in FY26.
Foreign exchange gains of A$5.7 million (FY24: gain of A$0.5 million) arose
primarily as a result of the weakening of the USD in the second half with
approximately half of LCM's outstanding debt denominated in USD.
This all resulted in an operating loss for the year of A$94.4 million (FY24:
operating profit of A$26.3 million). After debt interest costs of A$7.3
million, which were down on the prior year (A$10.2 million) primarily due to
the lower interest rate on the debt facility that was negotiated with the
facility's extension in December of 2024, we are reporting a loss before tax
of A$101.7 million (FY24: A$16.1 million). After tax this loss reduces to
A$72.9 million (FY24: profit after tax of A$12.7 million). In light of this
result, the Board has cancelled the dividend (FY24: 1.25p).
Balance Sheet (A$'m) - LCM Only FY25 FY24
Cash 8.9 53.0
Debtors 30.6 15.0
Investments at fair value 124.8 202.9
Investments held at cost 48.0 42.1
Other assets 1.7 1.5
Total assets 214.0 314.4
Borrowings (77.7) (61.9)
Tax payable (0.0) (0.9)
Deferred tax liability (15.3) (43.6)
Other creditors (6.6) (20.0)
Total liabilities (99.6) (125.5)
Net assets 114.4 188.9
NAV per share (pence) - Basic 53.2 94.4
NAV per share (pence) - Diluted 50.3 89.0
As of 30 June 2025, LCM was actively invested in 53 ongoing cases (FY24: 58)
with a total balance sheet value of A$172.8 million (FY24: A$245.0 million).
This valuation includes A$48.0 million related to three investments (FY24:
A$42.1 million) that are accounted for under AASB 15 for historic accounting
reasons, and A$124.8 million (FY24: A$202.9 million) for 50 investments (FY24:
55) that are held at fair value (AASB 9).
As previously noted, at the period end our case investments are held at an
aggregate value of 1.3x the cumulative LCM cash invested into those cases
(FY24: 2.4x) excluding the three cases accounted under AASB 15.
Cash at the period end was A$8.9 million, down significantly on the prior year
(FY24: A$53.0 million) due to the ongoing cash outflows associated with case
funding, operating expenses and interest payments not being offset by
meaningful cash realisations as a result of the disproportionate number of
losses in the period. When offset against borrowings of A$77.7 million
(FY24: A$61.9 million) the net debt position at the end of the period
increased to A$68.9 million (FY24: A$8.9 million).
Debtors have increased in the period, primarily attributable to the Green-X
Metals case against Poland, which has been booked as a realised investment
despite ongoing set-aside proceedings, as we view the likelihood of both
awards (Green-X has secured both an Energy Charter Treaty award and a
Australia-Poland Bilateral Investment Treaty award) being set aside as being
very low. This view is supported by historical statistics that show
set-aside proceedings typically succeed only in the single digit percentages
of cases. As Poland has to win two set-aside proceedings to avoid payment
that would imply a probability of the award being overturned via the set-aside
proceedings of less than 1%. Furthermore, Donald Tusk, the prime minister of
Poland, made a public statement in October 2024 following the awards saying
that he believed that Poland will ultimately have to pay Green-X Metals Ltd as
a consequence of the lost arbitration. So, as we believe the main risk from
here is enforcement / collection risk rather than litigation risk, this asset
is now recorded as a debtor rather than an investment at fair value.
From the prior period, all but A$1.8 million of the debtor balances at the end
of FY24 (A$15.0 million) were collected in FY25.
Beyond borrowings, deferred tax of A$15.3 million is the next largest
liability on the balance sheet. A$4.0 million of this relates to deferred tax
on the fair value of our investments, with the balance due to historic case
funding on ongoing cases that has already been recognised as an expense within
our tax accounting.
As a result of the large loss in the period, net assets declined to A$114.4
million (FY24: A$188.9 million). Net assets per share at the end of the
period was 50.3 pence on a fully diluted basis (FY24: 89.0 pence).
Cash Flow Statement (A$'m) - LCM Only FY25 FY24
Opening cash balance 53.0 83.0
Cash generated from concluded investments 33.6 56.7
Cash invested into ongoing cases (case funding) (59.8) (39.7)
Operating expenses (16.0) (17.0)
Net finance costs paid (6.5) (9.0)
Dividend and share buyback (8.0) (10.4)
Debt drawdown/repayments 12.2 (8.1)
Other 0.4 (2.5)
Closing cash balance 8.9 53.0
Net debt 68.9 8.9
During the period, cash generated from concluded investments in the period
amounted to A$33.6 million (FY24: A$56.7 million), inclusive of A$6.4 million
in performance fees (FY24: A$12.7 million). This included A$13.2m of debtors
from the prior period end that were collected in the period.
The cash invested in case funding in the period totalled A$59.8m million
(FY24: A$39.7 million), spread across 69 investments, of which 53 remained
ongoing at the period end.
Operating expenses were lower than the prior period at A$16.0 million (FY24:
A$17.0 million). The difference between this figure and the amount shown in
the P&L primarily relates to share based payments, and reimbursements of
operating expenses (in relation to fund management) which are disclosed as
other income in the P&L.
Net finance costs paid declined to A$6.5 million (FY24: A$9.0 million) driven
by the lower interest rate on the new debt facility. The difference between
this figure and the amount shown in the P&L is interest accrued.
Tax paid was A$0.6 million (FY23: A$2.8 million) relating to UK tax paid on
successful case conclusions in the prior financial year.
As a result of the lower cash coming into the business from successful case
resolutions we drew down A$12.2 million from the debt facility (FY24: A$8.1
million repayment) to meet case funding, operating expenses and interest
payments.
At the end of the financial period, we held A$8.9 million in cash (FY24:
A$53.0 million) and had a net debt position of A$68.9 million (FY23: A$8.9
million).
New Commitments section
New commitments declined during the period to A$79.2 million (FY24: A$279.0
million), as our focus shifted to reducing balance sheet strain following the
increase in leverage during the period.
Committed and Invested Capital
As of the end of the period, LCM was actively invested in 53 ongoing case
investments. Among these, 11 were fully funded by our balance sheet (of
which 3 cases comprise the majority of that invested capital) while 42 were
co-funded through our asset management model, where LCM typically funds 25% of
the investment cost.
Committed capital, which represents LCM share of total commitments across all
active cases net of conclusions and terminations decreased to A$269.3 million
at the period end (FY24: A$311.9 million). Of this amount, A$157.5 million
gross has been deployed to date.
Asset Management
Since 2020, we have been transitioning our business model to that of an asset
manager with cases funded typically 25% from our own balance sheet and 75%
from third party funds. To date we have raised USD441 million in external
funds across two funds: Fund I (USD150 million) and Fund II (USD291
million).
Fund I has invested in 23 case investments (net of 3 terminations) and was
fully committed and 85% deployed at the end of the period. Twelve of these
investments (9 wins and 3 losses) have fully concluded generating gross
proceeds of US$121.3 million on LP invested capital of US$54.9 million.
After accounting for performance fees of US$28.9 million paid to LCM, LP
investors have achieved a 1.7 Net MOIC and a net IRR of 30.4% on realisations
to date.
Fund II has invested into 37 cases (net of 13 terminations) and recently
closed to new investments. The fund closed to new business at around 65%
committed and was approaching US$50 million deployed as at 30 June 2025.
Five investments have concluded to date (2 wins and 3 losses) generating an
aggregate MOIC of 0.2x.
Post Period End
On 15 September 2025 we announced that LCM had terminated its investment in
the Australian class action against Gladstone Ports Corporation in relation to
alleged losses suffered by commercial fishermen from the large scale
contamination of Gladstone harbour and surrounding waters from a toxic dredge
spill in 2011-12. The investment was held on LCM's balance sheet at an
amount of A$30.8 million, being equal to the cash invested into the case.
The review of this investment has identified two avenues for potential
recovery of a material part of LCM's capital invested. Firstly, we believe
that the firm of solicitors, who initially acted for the claimants in this
claim, overcharged for legal services supplied to the claimants and we have
commenced a costs assessment seeking reimbursement of a portion of the legal
costs paid by LCM. Secondly, we are investigating a claim against those same
solicitors for breach of contract and negligence in association with the legal
services provided for the claim.
Post period end, LCM is awaiting the outcome of a trial in relation to a
separate investment in UK commercial litigation, co-funded alongside Fund I,
into which LCM has invested A$20.6 million of its own capital. The
judgment is expected in early October.
Furthermore, having previously sought permission to appeal the commercial
arbitration loss that was announced on 1 April 2025, LCM expects to hear if
permission has been granted in the near term and will update the market
accordingly.
Going Concern - Material Uncertainty
Given the number of adverse case outcomes in recent months, which have
impacted cash inflows and increased indebtedness, the Directors have
considered a range of scenarios, including plausible downside scenarios, and
note that in certain circumstances, further case losses could lead to a breach
of LCM's debt covenants.
LCM's lender has granted a debt covenant waiver through to 30 December 2025
and as part of this arrangement the interest rate on the loan increases by
2.00% per annum during the waiver period, and a one-time waiver fee equal to
1.50% of the principal amount outstanding will be payable.
While LCM's lender has been responsive in providing near-term covenant waivers
to date, any further amendments, should they be required, will be subject to
negotiation. This assessment is linked to a robust evaluation of the principal
risks facing LCM and the potential impact of these risks being realised.
After considering LCM's forecasts, stress testing and available mitigating
actions, and having regard to the inherent risks associated with the binary
nature of LCM's investment model, the Directors have concluded that a material
uncertainty exists which may cast significant doubt on LCM's ability to
continue as a going concern.
The material uncertainty relates to LCM's ability to comply with its debt
covenants in the event of certain adverse case outcomes. The Directors have a
reasonable expectation, based on current discussions, that LCM will continue
to receive the necessary support from its lender to allow it to continue in
operational existence for the foreseeable future. Accordingly, the financial
statements have been prepared on a going concern basis, whilst noting the
material uncertainty above.
Key Performance Indicators
FY22 FY23 FY24 FY25
Funds under management (US$m) 340 441 441 339
Track record (MOIC) 2.6x 2.8x 2.9x 2.0x
New commitments (A$m) 104 176 279 84
Committed capital 414 484 724 611
Invested capital (in period) 66 95 102 109
Cumulative invested capital (in ongoing cases) 184 227 281 301
Consolidated statement of profit or loss and other comprehensive income
For the period ended 30 June 2025
Consolidated
2025 2024
Note $'000 $'000
Income
Net realised gain on investments 5 43,643 61,778
Net unrealised gain/(loss) on investments 5 (206,767) 25,149
Movement in financial liabilities related to third-party interests in 5 90,133 (48,382)
consolidated entities
Litigation service revenue 5 - 12,443
Litigation service expense 5 (5,468) (3,236)
Total income/(loss) (78,459) 47,752
Expenses
Employee benefits expense 6 (12,061) (11,471)
Depreciation expense 6 (93) (145)
Corporate expenses 6 (4,841) (5,171)
Fund administration expense 6 (1,965) (3,400)
Foreign currency gains/(losses) 6 3,027 (1,432)
Total operating expenses (15,933) (21,619)
Operating profit/(loss) (94,392) 26,133
Finance costs 6 (7,295) (10,083)
Profit/(loss) before income tax expense (101,687) 16,050
Income tax (expense)/benefit 7 (28,774) (3,335)
Profit/(loss) after income tax expense (72,913) 12,715
Other comprehensive income
Items that may be subsequently reclassified to profit and loss:
Movement in foreign currency translation reserve 5,128 2,013
Total comprehensive income for the period (67,785) 14,728
Profit/(loss) for the period is attributable to:
Owners of Litigation Capital Management Limited (72,913) 12,715
(72,913) 12,715
Total comprehensive income for the period is attributable to:
Owners of Litigation Capital Management Limited (67,785) 14,728
(67,785) 14,728
Cents Cents
Basic earnings/(loss) per share 8 (70.83) 12.01
Diluted earnings/(loss) per share 8 (70.83) 11.33
The above Consolidated Statement of Profit or Loss and Other Comprehensive
Income should be read in conjunction with accompanying Notes to the Financial
Statements.
Consolidated statement of financial position
For the period ended 30 June 2025
Consolidated
2025 2024
Note $'000 $'000
Assets
Cash and cash equivalents 9 18,447 68,113
Trade receivables 10 1,786 10,986
Due from resolution of financial assets 11 88,201 3,980
Contract costs 12 47,988 42,072
Investments 13,21 287,735 465,213
Property, plant and equipment 135 157
Intangible assets 439 305
Other assets 827 977
Total assets 445,558 591,803
Liabilities
Trade and other payables 14 10,508 30,376
Tax payable/(refund) (6) 883
Employee benefits 1,115 1,112
Borrowings 15 77,747 61,917
Financial liabilities related to third-party interests in consolidated 16 226,538 264,950
entities
Deferred tax liability 7 15,286 43,624
Total liabilities 331,188 402,862
Net assets 114,370 188,941
Equity
Issued capital 17 60,634 69,674
Treasury shares 17 - (5,396)
Reserves 8,838 4,171
Retained earnings 44,899 120,492
Parent interest 114,370 188,941
Total equity 114,370 188,941
The above Consolidated Statement of Financial Position should be read in
conjunction with accompanying Notes to the Financial Statements.
Consolidated statement of changes in equity
For the period ended 30 June 2025
Share based Foreign
Issued Treasury Retained payments currency Total
capital shares earnings reserve translation equity
Consolidated $'000 $'000 $'000 $'000 $'000 $'000
Balance at 1 July 2023 69,674 2,440 (1,398) 183,469
- 112,753
Profit after income tax expense for the period - - 12,715 - - 12,715
Other comprehensive income for the period - - - - 2,013 2,013
Total comprehensive income for the period - - 12,715 - 2,013 14,728
Equity Transactions:
Share-based payments (note 28) 800
316 - - - 1,116
Dividends paid (note 19) - - (4,976) - - (4,976)
Treasury shares acquired (note 17) - (5,396) - - - (5,396)
316 (5,396) (4,976) 800 - (9,256)
Balance at 30 June 2024 69,990 3,240 615 188,941
(5,396) 120,492
Share based Foreign
Issued Treasury Retained payments currency Total
capital shares earnings reserve translation equity
Consolidated $'000 $'000 $'000 $'000 $'000 $'000
Balance at 1 July 2024 69,990 3,240 615 188,941
(5,396) 120,492
Loss after income tax expense for the period - - (72,913) - - (72,913)
Other comprehensive income for the period - - - - 5,128 5,128
Total comprehensive income for the period - - (72,913) - 5,128 (67,785)
Equity Transactions:
Share-based payments (note 28) (146)
1,359 - - - 1,213
Dividends paid (note 19) - - (2,680) - - (2,680)
Treasury shares acquired (note 17) - (4,458) - - - (4,458)
Cancellation of treasury shares (note 17) (9,854) 9,854 - - - -
LSPs exercised and purchased by EBT (note 17) (860) - - - - (860)
(9,356) - (2,680) (146) - (6,786)
Balance at 30 June 2025 60,634 - 3,094 114,370
44,899 5,744
The above Consolidated Statement of Changes in Equity should be read in
conjunction with accompanying Notes to the Financial Statements.
Consolidated statement of cash flows
For the period ended 30 June 2025
Consolidated
2025 2024
Note $'000 $'000
Cash flows from operating activities
Proceeds from litigation contracts 64,702 116,636
Payments for litigation contracts (128,166) (78,265)
Payments to suppliers and employees (16,411) (16,337)
Income tax paid (580) (2,830)
Net cash from/(used in) operating activities (80,454) 19,203
Cash flows from investing activities
Payments for property, plant and equipment (6) (31)
Payments for intangibles (200) (9)
Refund/(payment) of security deposits (2) 8
Net cash used in investing activities (207) (31)
Cash flows from financing activities
Payments for treasury shares 17 (5,318) (5,396)
Dividends paid 19 (2,680) (4,976)
Proceeds from borrowings 15 25,039 -
Repayments of borrowings 15 (12,864) (8,139)
Payments of finance costs (6,467) (8,960)
Payments of placement fees related to third-party interests (1,033) (2,206)
Contributions from third-party interests in consolidated entities 16 67,106 30,505
Distributions to third-party interests in consolidated entities 16 (33,959) (56,407)
Net cash from/(used in) financing activities 29,824 (55,578)
Net decrease in cash and cash equivalents (50,838) (36,405)
Cash and cash equivalents at the beginning of the period 68,113 104,457
Effects of exchange rate changes on cash and cash equivalents 1,171 61
Cash and cash equivalents at the end of the period 9 18,447 68,113
The above Consolidated Statement of Cash Flows should be read in conjunction
with accompanying Notes to the Financial Statements.
Notes to the financial statements
30 June 2025
Note 1. General information
The financial statements cover Litigation Capital Management Limited (the
'Company') as a Group consisting of Litigation Capital Management Limited and
the entities it controlled at the end of, or during, the year (referred to as
the 'Group'). The financial statements are presented in Australian dollars,
which is Litigation Capital Management Limited's functional and presentation
currency.
Litigation Capital Management Limited was admitted onto the Alternative
Investment Market ('AIM') on 19 December 2018.
Litigation Capital Management Limited is a for profit publicly listed company
limited by shares, incorporated and domiciled in Australia. Its registered
office and principal place of business is:
Level 12, The Chifley Tower
2 Chifley Square
Sydney NSW 2000
A description of the nature of the Group's operations and its principal
activities are included in the Directors' report, which is not part of the
financial statements.
The financial statements were authorised for issue, in accordance with a
resolution of Directors, on 1 October 2025. The Directors have the power to
amend and reissue the financial statements.
Basis of preparation
The Financial Report:
· is a general purpose financial report;
· has been prepared in accordance with the Australian Accounting Standards
adopted by the Australian Accounting Standards Board (AASB) and International
Financial Reporting Standards (IFRSs) as issued by the International
Accounting Standards Board (IASB);
· has been prepared in accordance with the requirements of the Corporations
Act 2001 (Cth);
· is presented in Australian dollars, which is the Group's functional and
presentation currency, with all values rounded to the nearest thousand
dollars, or in certain cases to the nearest dollar, in accordance with ASIC
Corporations Instrument 2016/191 unless otherwise indicated;
· includes foreign currency transactions that are translated into the
functional currency, using the exchange rates prevailing at the date of the
Financial Report;
· has been prepared on a going concern basis using a historical cost basis,
except for certain assets and liabilities measured at fair value;
· presents assets and liabilities on the face of the Balance Sheets in
decreasing order of liquidity;
· where required, presents restated comparative information for consistency
with the current year's presentation in the Financial Report; and
· contains accounting policies that have been consistently applied to all
periods presented, unless otherwise stated.
Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities
of all subsidiaries of Litigation Capital Management Limited ('Company' or
'parent entity') as at 30 June 2025 and the results of all subsidiaries for
the year then ended. Litigation Capital Management Limited and its
subsidiaries together are referred to in these financial statements as the
'Group'.
The Group includes fund investment vehicles over which the Group has the right
to direct the relevant activities of the fund under contractual arrangements
and has exposure to variable returns from the fund investment vehicles. See
note 4.
Subsidiaries are all those entities over which the Group has control. The
Group controls an entity when the Group is exposed to, or has rights to,
variable returns from its involvement with the entity and has the ability to
affect those returns through its power to direct the activities of the entity.
Subsidiaries are fully consolidated from the date on which control is
transferred to the Group. They are de-consolidated from the date that control
ceases.
Intercompany transactions, balances and unrealised gains on transactions
between entities in the Group are eliminated. Unrealised losses are also
eliminated unless the transaction provides evidence of the impairment of the
asset transferred. Accounting policies of subsidiaries have been changed where
necessary to ensure consistency with the policies adopted by the Group.
Note 2. Material accounting policies
Accounting standards and interpretations
The accounting policies adopted are consistent with those followed in the
preparation of the Group's annual consolidated financial statements for the
year ended 30 June 2024.
New and amended accounting standards and interpretations issued but not yet
effective
The new and amended standards and interpretations that are issued, but not yet
effective, up to the date of issuance of the Group's financial statements that
the Group reasonably expects will have an impact on its disclosures, financial
position or performance when applied at a future date, are disclosed below.
• Amendment to IFRS 9 and IFRS 7 - Classification and Measurement of
Financial Instruments
• IFRS 18 Presentation and Disclosure in Financial Statements
• IFRS 19 Subsidiaries without Public Accountability: Disclosures
• IFRS S1, General requirements for disclosure of sustainability-related
financial information
• IFRS S2 Climate-related disclosures
The Group intends to adopt these new and amended standards and
interpretations, if applicable, when they become effective. The Group has not
listed other standards and interpretations which are issued but not yet
effective, as they are not expected to impact the Group.
Going concern
Litigation Capital Management Limited and its wholly owned subsidiaries
("LCM") and the Group's fund structures ("Fund") have prepared the financial
statements on the going concern basis, which contemplates continuity of normal
business activities and the realisation of assets and discharge of liabilities
in the normal course of business.
Given the number of adverse case outcomes in recent months, which have
impacted cash inflows and increased indebtedness, the Directors have
considered a range of scenarios, including plausible downside scenarios, and
note that in certain circumstances, further case losses could lead to a breach
of LCM's debt covenants.
While LCM's lender has been responsive in providing near-term covenant waivers
to date, any further amendments, should they be required, will be subject to
negotiation. This assessment is linked to a robust evaluation of the principal
risks facing LCM and the potential impact of these risks being realised.
After considering LCM's forecasts, stress testing and available mitigating
actions, and having regard to the inherent risks associated with the binary
nature of LCM's investment model, the Directors have concluded that a material
uncertainty exists which may cast significant doubt on LCM's ability to
continue as a going concern.
The material uncertainty relates to LCM's ability to comply with its debt
covenants in the event of certain adverse case outcomes. The Directors have a
reasonable expectation, based on current discussions, that LCM will continue
to receive the necessary support from its lender to allow it to continue in
operational existence for the foreseeable future. Accordingly, the financial
statements have been prepared on a going concern basis, whilst noting the
material uncertainty above.
However, these events and conditions indicate that a material uncertainty
exists which may cast significant doubt on LCM's ability to continue as a
going concern, and therefore the entity may be unable to realise its assets
and discharge its liabilities in the normal course of business and at the
amounts stated in the financial report. The financial report does not include
any adjustments relating to the amounts or classification of recorded assets
or liabilities that might be necessary if LCM does not continue as a going
concern.
Operating segments
Operating segments are presented using the 'management approach', where the
information presented is on the same basis as the internal reports provided to
the Chief Operating Decision Makers ('CODM'). The CODM is responsible for the
allocation of resources to operating segments and assessing their performance.
Foreign currency translation
The financial statements are presented in Australian dollars, which is
Litigation Capital Management Limited's functional and presentation currency.
Foreign currency transactions
Foreign currency transactions are translated into the entity's functional
currency using the exchange rates prevailing at the dates of the transactions.
Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation at financial year-end exchange rates of
monetary assets and liabilities denominated in foreign currencies are
recognised in profit or loss.
Foreign
operations
The assets and liabilities of foreign operations are translated into
Australian dollars using the exchange rates at the reporting date. The
revenues and expenses of foreign operations are translated into Australian
dollars using the average exchange rates, which approximate the rates at the
dates of the transactions, for the period. All resulting foreign exchange
differences are recognised in other comprehensive income through the foreign
currency reserve in equity.
The foreign currency reserve is recognised in profit or loss when the foreign
operation or net investment is disposed of.
Fair value measurement
The Group measures its financial instruments such as litigation funding
agreements and financial liabilities related to third-party interests at fair
value at each balance sheet date.
When an asset or liability, financial or non-financial, is measured at fair
value for recognition or disclosure purposes, the fair value is based on the
price that would be received to sell an asset or paid to transfer a liability
in an orderly transaction between market participants at the measurement date;
and assumes that the transaction will take place either: in the principal
market; or in the absence of a principal market, in the most advantageous
market.
Fair value is measured using the assumptions that market participants would
use when pricing the asset or liability, assuming they act in their economic
best interests. For non-financial assets, the fair value measurement is based
on its highest and best use. Valuation techniques that are appropriate in the
circumstances and for which sufficient data are available to measure fair
value, are used, maximising the use of relevant observable inputs and
minimising the use of unobservable inputs.
The Group uses valuation techniques that are appropriate in the circumstances
and for which sufficient data is available to measure fair value, maximising
the use of relevant observable inputs and minimising the use of unobservable
inputs.
All assets and liabilities for which fair value is measured or disclosed in
the financial statements are categorised within the fair value hierarchy,
described as follows, based on the lowest level input that is significant to
the fair value measurement as a whole:
· Level 1 - Quoted (unadjusted) market prices in active markets for identical
assets or liabilities
· Level 2 - Valuation techniques for which the lowest level input that is
significant to the fair value measurement is directly or indirectly observable
· Level 3 - Valuation techniques for which the lowest level input that is
significant to the fair value measurement is unobservable
For assets and liabilities that are recognised in the financial statements at
fair value on a recurring basis, the Group determines whether transfers have
occurred between levels in the hierarchy by re-assessing categorisation (based
on the lowest level input that is significant to the fair value measurement as
a whole) at the end of each reporting period.
The Group's Executive Leadership Committee determines the policies and
procedures for fair value measurement, including the litigation funding
agreements. The Committee is comprised of the Chief Executive Officer, Chief
Financial Officer and Head of Investments or equivalent.
The level of involvement of external valuers or specialist valuation experts
is determined annually by the Committee after discussion with and approval by
the Company's Audit Committee. Selection criteria include market knowledge,
reputation, independence and whether professional standards are maintained.
At each reporting date, the Committee analyses the movements in the values of
assets and liabilities which are required to be remeasured or re-assessed as
per the Group's accounting policies. For this analysis, the Committee verifies
the major inputs applied in the latest valuation by agreeing the information
in the valuation computation to contracts and other relevant documents.
Fair-value related disclosures for financial instruments and non-financial
assets that are measured at fair value or where fair values are disclosed, are
summarised in the following notes:
· Disclosures for valuation methods, significant estimates and assumptions Note
21
· Quantitative disclosures of fair value measurement hierarchy Note 21
· Financial instruments Note 20
Litigation
service
Revenue is recognised at the amount the Group expects to be entitled to in
exchange for its services. For each customer contract, the Group identifies
the performance obligations, determines the transaction price (including any
variable consideration), and recognises revenue when the performance
obligation is satisfied.
Variable consideration reflects the uncertainty of outcomes in awards,
settlements or other contingent events. It is estimated using either the
"expected value" or "most likely amount" method and recognised only when it is
highly probable that a significant reversal will not occur. Until the
uncertainty is resolved, amounts received that are subject to this constraint
are recorded as refund liabilities.
The performance of a litigation service contract by the Group entails the
management and progression of the litigation project during which costs are
incurred by the Group over the life of the litigation project. As
consideration for providing litigation management services and financing of
litigation projects, the Group receives either a percentage of the gross
proceeds of any award or settlement of the litigation, or a multiple of
capital deployed, and is reimbursed for all invested capital.
Revenue, which includes amounts in excess of costs incurred and the
reimbursement for all invested capital, is not recognised as revenue until the
successful completion of the litigation project ie, complete satisfaction of
the performance obligation, which is generally at the point in time when a
judgment has been awarded or on an agreed settlement between the parties to
the litigation, and therefore when the outcome is considered highly probable.
On this basis, revenue is not recognised over time and instead recognised at
the point in time when the Group satisfies the performance obligation. Costs
include only external costs of funding the litigation, such as solicitors'
fees, counsels' fees and experts' fees.
The terms and duration of each settlement or judgment varies by litigation
project. Payment terms are not defined by the Group's litigation contracts
however upon successful completion of a litigation project, being the
satisfaction of the single performance obligation, funds are generally paid
into trust within 28 days. The funds will remain in trust until the
distribution amounts have been determined and agreed by the relevant parties,
after which payment will be received by the Group.
Income tax
The income tax expense or benefit for the period is the tax payable on that
period's taxable income based on the applicable income tax rate for each
jurisdiction, adjusted by the changes in deferred tax assets and liabilities
attributable to temporary differences, unused tax losses and the adjustment
recognised for prior periods, where applicable.
Deferred tax assets and liabilities are recognised for temporary differences
at the tax rates expected to be applied when the assets are recovered or
liabilities are settled, based on those tax rates that are enacted or
substantively enacted, except for:
· When the deferred income tax asset or liability arises from the initial
recognition of goodwill or an asset or liability in a transaction that is not
a business combination and that, at the time of the transaction, affects
neither the accounting nor taxable profits; or
· When the taxable temporary difference is associated with interests in
subsidiaries, associates or joint ventures, and the timing of the reversal can
be controlled and it is probable that the temporary difference will not
reverse in the foreseeable future.
Deferred tax assets are recognised for deductible temporary differences and
unused tax losses only if it is probable that future taxable amounts will be
available to utilise those temporary differences and losses.
The carrying amount of recognised and unrecognised deferred tax assets are
reviewed at each reporting date. Deferred tax assets recognised are reduced to
the extent that it is no longer probable that future taxable profits will be
available for the carrying amount to be recovered. Previously unrecognised
deferred tax assets are recognised to the extent that it is probable that
there are future taxable profits available to recover the asset.
Deferred tax assets and liabilities are offset only where there is a legally
enforceable right to offset current tax assets against current tax liabilities
and deferred tax assets against deferred tax liabilities; and they relate to
the same taxable authority on either the same taxable entity or different
taxable entities which intend to settle simultaneously.
Litigation Capital Management Limited (the 'head entity') and its wholly-owned
Australian subsidiaries have formed an income tax consolidated group under the
tax consolidation regime. The head entity and each subsidiary in the tax
consolidated group continue to account for their own current and deferred tax
amounts. The tax consolidated group has applied the 'separate taxpayer within
group' approach in determining the appropriate amount of taxes to allocate to
members of the tax consolidated group.
In addition to its own current and deferred tax amounts, the head entity also
recognises the current tax liabilities (or assets) and the deferred tax assets
arising from unused tax losses and unused tax credits assumed from each
subsidiary in the tax consolidated group.
Assets or liabilities arising under tax funding agreements with the tax
consolidated entities are recognised as amounts receivable from or payable to
other entities in the tax consolidated group. The tax funding arrangement
ensures that the intercompany charge equals the current tax liability or
benefit of each tax consolidated group member, resulting in neither a
contribution by the head entity to the subsidiaries nor a distribution by the
subsidiaries to the head entity.
Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with
financial institutions, other short-term, highly liquid investments with
original maturities of three months or less that are readily convertible to
known amounts of cash and which are subject to an insignificant risk of
changes in value.
Trade and other receivables
Trade receivables are initially recognised at fair value and subsequently
measured at amortised cost using the effective interest method, less any
allowance for expected credit losses. Trade receivables generally do not have
a specifically defined time frame for settlement, additionally, when the
receivable is due from part of the portfolio of litigation projects, the
settlement of the receivable is generally made upon an additional resolution
of another litigation project within the portfolio which also may not be
within a specifically defined time frame.
The Group has applied the simplified approach to measuring expected credit
losses for trade receivables and contract assets, which uses a lifetime
expected loss allowance. To measure the expected credit losses, trade
receivables have been grouped based on days overdue.
Due from resolution of investments
Amounts due from the settlement of financial assets relate to the realisation
of litigation funding assets that have been successfully concluded and where
there is no longer any litigation risk remaining and represent the expected
cash flow to be received by the Group. The settlement terms and timing of
realisations vary by litigation funding asset. The majority of settlement
balances are received shortly after the period end in which the litigation
funding asset has concluded, and all settlement balances are generally
expected to be received within 12 months after completion.
Contract costs
Contract costs are recognised as an asset when the Group incurs costs in
fulfilling a contract and when all the following are met: (i) the costs relate
directly to the contract; (ii) the costs generate or enhance resources of the
Group that will be used to satisfy future performance obligations; and (iii)
the costs are expected to be recovered. Contract costs are financial assets
for impairment purposes. The Group's revenue recognition policy for litigation
service revenue provides further information.
Investments
Investments are financial assets recognised at fair value through profit or
loss and are fair valued using an income approach. Financial assets at fair
value through profit or loss are carried in the statement of financial
position at fair value with net changes in fair value recognised in the
statement of profit or loss. This category includes the Group's litigation
funding assets. The litigation funding assets are primarily derecognised when
the underlying litigation resolves and transfers to Due from resolution of
financial assets.
Financial assets are derecognised when the contractual rights to the cash
flows expire or when the asset, along with the associated risks and rewards of
ownership, are substantially transferred to another entity.
Financial liabilities related to third-party interests in consolidated
entities
Non-controlling interests where the Group does not own 100% of a consolidated
entity are recorded as financial liabilities related to third-party interests
in consolidated entities. Financial liabilities related to third-party
interests in consolidated entities are initially recognised at the fair value.
Gains or losses on liabilities held at fair value through profit or loss are
recognised in the statement of profit or loss as 'Movement in financial
liabilities related to third-party interests in consolidated entities'. They
are subsequently measured at fair value using an income approach. Amounts
included in the consolidated statement of financial position represent the net
asset value of the third-parties' interests. These amounts have been elected
to be measured at fair value to reduce the accounting mismatch between the
related financial asset measured at fair value through profit or loss.
Financial liabilities are derecognised when the obligation to settle through
cash flows has expired or been transferred.
Impairment of non-financial assets
Non-financial assets are reviewed for impairment at each reporting date and
whenever events or changes in circumstances indicate that the carrying amount
may not be recoverable. An impairment loss is recognised for the amount by
which the asset's carrying amount exceeds its recoverable amount.
Recoverable amount is the higher of an asset's fair value less costs of
disposal and value-in-use. The value-in-use is the present value of the
estimated future cash flows relating to the asset using a pre-tax discount
rate specific to the asset or cash-generating unit to which the asset belongs.
Assets that do not have independent cash flows are grouped together to form a
cash-generating unit.
Trade and other payables
These amounts represent liabilities for goods and services provided to the
Group prior to the end of the financial year and which are unpaid. Due to
their short-term nature they are measured at amortised cost and are not
discounted. The amounts are unsecured and are usually paid within 30 days of
recognition.
Borrowings
Borrowings are initially recognised at fair value net of transaction costs
incurred. Subsequent to initial recognition, borrowings are stated at
amortised cost.
Net finance costs
Net finance costs comprise interest income from the investment of excess funds
in short-term, highly liquid investments, and interest expense and borrowing
costs related to the borrowing of funds.
Employee benefits
Short-term employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual
leave and long service leave expected to be settled wholly within 12 months of
the reporting date are measured at the amounts expected to be paid when the
liabilities are settled.
Other long-term employee benefits
The liability for annual leave and long service leave not expected to be
settled within 12 months of the reporting date are measured at the present
value of expected future payments to be made in respect of services provided
by employees up to the reporting date. Consideration is given to expected
future wage and salary levels, experience of employee departures and periods
of service. Expected future payments are discounted using market yields at the
reporting date on high quality corporate bonds with terms to maturity and
currency that match, as closely as possible, the estimated future cash
outflows.
Superannuation expense
Contributions to superannuation are expensed in the period in which they are
incurred.
Share-based payments
Equity-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or options over shares, that
are provided to employees in exchange for the rendering of services.
The cost of equity-settled transactions are measured at fair value on grant
date. Fair value is determined using either the Monte Carlo or Black-Scholes
option pricing model that takes into account the exercise price, the term of
the option, the impact of dilution, the share price at grant date and expected
price volatility of the underlying share, the expected dividend yield and the
risk free interest rate for the term of the option, together with non-vesting
conditions that do not determine whether the Group receives the services that
entitle the employees to receive payment. No account is taken of any other
vesting conditions.
The cost of equity-settled transactions are recognised as an expense with a
corresponding increase in equity over the vesting period. The cumulative
charge to profit or loss is calculated based on the grant date fair value of
the award, the best estimate of the number of awards that are likely to vest
and the expired portion of the vesting period. The amount recognised in profit
or loss for the period is the cumulative amount calculated at each reporting
date less amounts already recognised in previous periods.
Market conditions are taken into consideration in determining fair value.
Therefore any awards subject to market conditions are considered to vest
irrespective of whether or not that market condition has been met, provided
all other conditions are satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised
as if the modification has not been made. An additional expense is recognised,
over the remaining vesting period, for any modification that increases the
total fair value of the share-based compensation benefit as at the date of
modification.
If the non-vesting condition is within the control of the Group or employee,
the failure to satisfy the condition is treated as a cancellation. If the
condition is not within the control of the Group or employee and is not
satisfied during the vesting period, any remaining expense for the award is
recognised over the remaining vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on
the date of cancellation, and any remaining expense is recognised immediately.
If a new replacement award is substituted for the cancelled award, the
cancelled and new award may be treated as if they were a modification,
depending on the specific circumstances of the award.
Issued capital
Ordinary shares are classified as equity. Incremental costs directly
attributable to the issue of new shares or options are shown in equity as a
deduction, net of tax, from the proceeds.
Treasury shares
Where Group purchase shares in the listed Company, the consideration paid is
deducted from issued capital and the shares are treated as treasury shares
until they are subsequently sold, reissued or cancelled. Where such shares are
sold or reissued, any consideration received is included in shareholders'
equity.
Dividends
Dividends are recognised when declared during the financial year and no longer
at the discretion of the Company.
Earnings per share
Basic earnings per
share
Basic earnings per share is calculated by dividing the profit attributable to
the owners of Litigation Capital Management Limited, excluding any costs of
servicing equity other than ordinary shares, by the weighted average number of
ordinary shares outstanding during the financial year, adjusted for bonus
elements in ordinary shares issued during the financial year.
Diluted earnings per share
Diluted earnings per share is calculated by adjusting the denominator used in
the determination of basic earnings per share to include the weighted average
number of ordinary shares outstanding and the effect of dilutive potential
ordinary shares, such as share options and performance rights.
Note 3. Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make
judgements, estimates and assumptions that affect the reported amounts in the
financial statements. Management continually evaluates its judgements and
estimates in relation to assets, liabilities, contingent liabilities, revenue
and expenses. Management bases its judgements, estimates and assumptions on
historical experience and on other various factors, including expectations of
future events, management believes to be reasonable under the circumstances.
The resulting accounting judgements and estimates will seldom equal the
related actual results. The judgements, estimates and assumptions that have a
significant risk of causing a material adjustment to the carrying amounts of
assets and liabilities (refer to the respective notes) within the next
financial year are discussed below.
Key judgements
Consolidation of entities in which the Group holds less than 100% of interests
The Group has assessed the entities in which it has an interest to determine
whether or not control exists and the entity is, therefore, consolidated into
the Group (refer note 4). Where the Group does not own 100% of interests, the
Group makes judgements to determine whether to consolidate the entity in
question by applying the factors set forth in AASB 10, including but not
limited to the Group's equity and economic ownership interest, the economic
structures in use in the entity, the level of control the Group has over the
entity through the entity's structure or any relevant contractual agreements,
and the rights of other investors.
Significant estimates and assumptions
Net gains/(losses) on financial assets & liabilities at fair value through
profit or loss
The Group carries its financial assets and liabilities at fair value, with
changes in fair value being recognised in the statement of profit or loss. A
valuation methodology based on an income approach.
The fair values of these financial assets and liabilities cannot be measured
based on quoted prices in active markets, and as a result a fair value
methodology is utilised. The measurement valuation technique includes a
discounted cash flow (DCF) model based on the Group's estimated, risk adjusted
future cash flows. The adopted discount rate reflects the funding cost of
deploying capital, and is intended to capture the time value of money and
market factors such as interest rates and foreign exchange rates.
The fair value framework incorporates assumptions, including the discount
rate, the timing and amount of expected cash inflows and additional funding,
and a risk-adjustment factor reflecting the inherent uncertainty in the cash
flows due to litigation risk, which is dependent on observable case
progression and milestones.
The inputs to these models are taken from observable markets where possible,
but where this is not feasible, a degree of judgement is required in
establishing fair values. Judgements include considerations of inputs such as
case progress, credit risk and volatility. Changes in assumptions relating to
these factors could affect the reported fair value of financial instruments.
The key assumptions used to determine the fair value of the litigation funding
agreements, financial liabilities related to third-party interests in
consolidated entities and sensitivity analyses are provided in note 21.
The Group refined its valuation methodology during the period. While the
overall framework remains conceptually robust and consistent with industry
practice, experience since implementation highlighted opportunities to enhance
the setting of key assumptions so that valuations more accurately reflect the
Group's risk profile. In particular, refinements were made to:
· Forecast returns: recalibrated to ensure they remain supportable in the
context of historical outcomes and available market benchmarks;
· Expected duration: revised to be anchored to objective case milestones and
extended to reflect observed delays in resolution; and
· Risk adjustment factors: updated so that recognition of value is more
closely aligned to substantive external events rather than procedural steps.
These refinements result in a more conservative recognition profile and are
intended to strengthen the robustness and consistency of the Group's fair
value determinations. The Group has established a process for reviewing fair
value assumptions on an annual basis, with the results of that review
submitted to the Audit & Risk Committee in advance of the publication of
annual results.
Note 4. Segment information
For management purposes, the Group is organised into two operating segments
comprising the operations of Litigation Capital Management Limited and its
wholly owned subsidiaries ("LCM") and the Group's fund structures ("Fund").
LCM
The LCM column includes the 25% co-investment in the Funds, Balance Sheet
investments (ie, 100% investment by LCM) and corporate operations.
Fund I & II
This comprises LCM Global Alternative Returns Fund and LCM Global Alternative
Returns Fund II and their entities as disclosed in note 27. AASB 10
Consolidated Financial Statements requires the Group to consolidate fund
investment vehicles over which it has exposure to variable returns from the
fund investment vehicles. As a result, third party interests in relation to
the Funds have been consolidated in the financial statements. The Fund column
includes the 75% co-investment in the litigation funding assets and costs of
administering the funds.
The following tables reflect the impact of consolidating the results of the
Funds with the results for LCM to arrive at the totals reported in the
consolidated statement of profit or loss and other comprehensive income,
consolidated statement of financial position and consolidated statement of
cash flows.
Consolidated Statement of Comprehensive Income
2025 2024
LCM Fund Consolidated LCM Fund Consolidated
$'000 $'000 $'000 $'000 $'000 $'000
Income
Net realised gain on investments 22,187 21,456 43,643 23,033 38,744 61,778
Net unrealised gain/(loss) on investments (100,103) (106,664) (206,767) 12,477 12,671 25,149
Movement in financial liabilities related to third-party interests in - 90,133 90,133 - (48,382) (48,382)
consolidated entities
Litigation service revenue - - - 12,443 - 12,443
Litigation service expense (5,468) - (5,468) (3,236) - (3,236)
Other income 1,356 (1,356) - - - -
Total income/(loss) (82,028) 3,569 (78,459) 44,718 3,033 47,752
Expenses
Employee benefits expense (12,061) - (12,061) (11,471) - (11,471)
Depreciation expense (93) - (93) (145) - (145)
Corporate expenses (4,841) - (4,841) (5,171) - (5,171)
Fund administration expense (1,033) (932) (1,965) (2,180) (1,220) (3,400)
Foreign currency gains/(losses) 5,663 (2,636) 3,027 537 (1,968) (1,432)
Total operating expenses (12,365) (3,569) (15,933) (18,430) (3,189) (21,619)
Operating profit/(loss) (94,392) - (94,392) 26,288 (155) 26,133
Finance costs (7,295) - (7,295) (10,238) 155 (10,083)
Profit/(loss) before income tax expense (101,687) (101,687) 16,050 - 16,050
Income tax (expense)/benefit 28,774 - 28,774 (3,335) - (3,335)
Profit/(loss) after income tax expense (72,913) - (72,913) 12,715 - 12,715
Other comprehensive income for the period, net of tax 5,128 - 5,128 2,013 - 2,013
Total comprehensive income for the period (67,785) - (67,785) 14,728 - 14,728
Consolidated statement of financial position
2025 2024
LCM Fund Consolidated LCM Fund Consolidated
$'000 $'000 $'000 $'000 $'000 $'000
Assets
Cash and cash equivalents 8,865 9,582 18,447 53,024 15,089 68,113
Trade & other receivables 1,786 - 1,786 10,986 - 10,986
Due from resolution of financial assets 28,824 59,377 88,201 3,980 - 3,980
Contract costs 47,988 - 47,988 42,072 - 42,072
Financial assets at fair value through profit or loss 124,839 162,896 287,735 202,913 262,300 465,213
Property, plant and equipment 135 - 135 157 - 157
Intangible assets 439 - 439 305 - 305
Other assets 1,174 (347) 827 999 (22) 977
Total assets 214,050 231,508 445,558 314,436 277,367 591,803
Liabilities
Trade and other payables 5,538 4,970 10,508 17,959 12,417 30,376
Tax payable (6) - (6) 883 - 883
Employee Benefits 1,115 - 1,115 1,112 - 1,112
Borrowings 77,747 - 77,747 61,917 - 61,917
Third-party interests in consolidated entities - 226,538 226,538 - 264,950 264,950
Deferred tax liability 15,286 - 15,286 43,624 - 43,624
Total liabilities 99,680 231,508 331,188 125,494 277,367 402,862
Net assets 114,370 - 114,370 188,941 - 188,941
A financial liability at fair value through the income statement is recognised
in the parent entity in relation to the transactions entered into with certain
Fund structures to support the financing of LFAs. These arrangements fail the
derecognition principles in IFRS 9 and represents the net share of the overall
LFA at fair value apportioned to the Funds.
Consolidated Statement of Cash Flows
2025 2024
LCM Fund Consolidated LCM Fund Consolidated
$'000 $'000 $'000 $'000 $'000 $'000
Cash flows from operating activities
Proceeds from litigation contracts 33,566 31,136 64,702 56,771 59,864 116,636
Payments for litigation contracts (59,762) (68,404) (128,166) (39,693) (38,572) (78,265)
Payments to suppliers and employees (14,928) (1,482) (16,411) (14,765) (1,572) (16,337)
Income tax paid (580) - (580) (2,830) - (2,830)
Net cash from/(used in) operating activities (41,704) (38,750) (80,454) (517) 19,720 19,203
-
Cash flows from investing activities -
Payments for property, plant and equipment (6) - (6) (31) - (31)
Payments for intangibles (200) - (200) (9) - (9)
Refund/(payment) of security deposits (2) - (2) 8 - 8
Net cash used in investing activities (207) - (207) (31) - (31)
Cash flows from financing activities
Payments for treasury shares (5,318) - (5,318) (5,396) - (5,396)
Dividends paid (2,680) - (2,680) (4,976) - (4,976)
Proceeds from borrowings 25,039 - 25,039 - - -
Repayments of borrowings (12,864) - (12,864) (8,139) - (8,139)
Payments of finance costs (6,467) - (6,467) (8,960) - (8,960)
Payments of placement fees related to third-party interests (1,033) - (1,033) (2,206) - (2,206)
Contributions from third-party interests in consolidated entities - 67,106 67,106 - 30,505 30,505
Distributions to third-party interests in consolidated entities - (33,959) (33,959) - (56,407) (56,407)
Net cash from/(used in) financing activities (3,323) 33,146 29,824 (29,677) (25,901) (55,578)
Net decrease in cash and cash equivalents (45,234) (5,604) (50,838) (30,224) (6,181) (36,405)
Cash and cash equivalents at the beginning of the period 53,024 15,089 68,113 82,973 21,484 104,457
Effects of exchange rate changes on cash and cash equivalents 1,075 97 1,171 275 (214) 61
Cash and cash equivalents at the end of the period 8,865 9,582 18,447 53,024 15,089 68,113
Note 5. Income
2025 2024
LCM Fund Consolidated LCM Fund Consolidated
$'000 $'000 $'000 $'000 $'000 $'000
Net realised gain on investments
Recoveries on resolved investments 49,672 94,105 143,777 44,027 58,359 102,386
Capital invested on resolved investments (27,485) (72,649) (100,134) (20,994) (19,615) (40,609)
22,187 21,456 43,643 23,033 38,744 61,778
Net unrealised gain/(loss) on investments
Fair value removal on concluded investments (49,020) (44,997) (94,017) (32,962) (16,644) (49,605)
Fair value write down on case losses under appeal (44,536) (41,773) (86,309) - - -
Fair value movement on pre-hearing/trial ongoing investments(1) (6,824) (21,292) (28,115) 44,562 30,206 74,768
Foreign exchange movement on fair value 276 1,398 1,674 877 (891) (14)
(100,103) (106,664) (206,766) 12,477 12,671 25,149
Total gain/(loss) on investments (77,915) (85,208) (163,124) 35,511 51,416 86,925
Movement in financial liabilities related to third-party interests in - 90,133 90,133 - (48,382) (48,382)
consolidated entities
Net gain from contract costs - - - 9,207 - 9,207
Other income 1,356 (1,356) - - - -
Total income/(loss) (76,560) 3,569 (72,991) 44,718 3,033 47,752
1 Refer note 3 for refinements made to the valuation methodology during the
period
Effective from 1 July 2024, management has revised the presentation of income
to provide greater transparency over the composition of realised and
unrealised gains and losses. The revised disclosure provides greater
transparency by disaggregating movements between LCM and the Fund, and by
separately identifying recoveries and capital invested on resolved
investments, fair value write-offs, fair value movements on ongoing
investments, and foreign exchange movements. As a result, the comparative note
disclosure for the year ended 30 June 2024 has been restated to reallocate
amounts between line items. Importantly, the total income recognised for the
prior period remains unchanged.
Realised gains relate to amounts where litigation risk has concluded and
amounts are expected to be received by LCM. Unrealised gains or losses relate
to the fair value movement of assets and liabilities associated with
litigation contracts. The gain and loss related to third party interests in
consolidated entities represents realised and unrealised gains and losses that
relate to third party funded proportions from LCM controlled entities.
Litigation service
Consolidated
2025 2024
$'000 $'000
Litigation service revenue - 12,443
Litigation service expense (5,468) (3,236)
(5,468) 9,207
Major service lines
Revenue attributable to LCM - 12,443
Attributable to third party interests - -
- 12,443
Geographical regions
Australia - 12,443
- 12,443
Litigation service revenue relates to an individual litigation asset which
resolved during the period and had a contract duration of more than 4 years.
Note 6. Profit/(loss) before tax
Consolidated
2025 2024
$'000 $'000
Profit/(loss) before income tax expense includes the following specific
expenses:
Employee benefits expense
Salaries & wages 9,021 8,513
Non-Executive directors' fees 420 457
Superannuation and pension 292 311
Share based payments expense 1,117 1,116
Other employee benefits & costs 1,210 1,074
12,061 11,471
Depreciation
Plant and equipment 28 84
Intangible assets 65 60
93 145
Corporate expenses
Corporate & secretary expenses 435 322
General & Administrative Expenses 208 228
Insurance 337 419
Marketing & Advertising 68 345
Occupancy Costs 902 906
Other expenses 183 284
Professional fees 1,534 2,012
Travel & entertainment expenses 1,174 656
4,841 5,171
Fund administration expense
General administration expenses 932 1,220
Placement fees 1,033 2,180
1,965 3,400
Foreign currency gains/(losses)
Realised foreign exchange loss 1,053 2,934
Unrealised foreign exchange gain (4,080) (1,502)
(3,027) 1,432
Finance costs
Net interest on borrowings 6,750 9,017
Net finance costs of third-party interests - (155)
Other finance costs 545 1,221
7,295 10,083
Note 7. Income tax expense
Consolidated
2025 2024
$'000 $'000
Numerical reconciliation of income tax expense and tax at the statutory rate
Profit/(loss) before income tax expense (101,687) 16,050
At the Group's statutory income tax rate of 30% (2024: 30%) (30,506) 4,815
Tax effect amounts which are not deductible/(taxable) in calculating taxable
income:
Foreign tax rate adjustments 3,863 (2,385)
Share-based payments 52 335
Other assessable income 181 139
Other non-deductible expenses (2,092) 215
Adjustment in respect of income and deferred tax of previous years (272) 217
Income tax expense / (benefit) (28,774) 3,335
Consolidated
2025 2024
$'000 $'000
Current tax (437) (4,030)
Deferred tax (28,337) 7,365
Income tax expense / (benefit) (28,774) 3,335
Consolidated
2025 2024
$'000 $'000
Deferred tax asset/(liability)
Deferred tax asset/(liability) comprises temporary differences attributable
to:
Tax losses 643 -
Interest deductions denied 2,623 -
Employee benefits 333 302
Accrued expenses 80 172
Expenditure deductible for income tax over time 1,356 1,706
Share based payments 788 464
Deductible funding on contract costs and financial assets (17,102) (16,634)
Fair value adjustments to financial assets (4,008) (29,634)
Deferred tax asset/(liability) (15,286) (43,624)
Movements:
Opening balance (43,624) (36,259)
Charged to profit or loss 28,337 (7,365)
Closing balance (15,286) (43,624)
Note 8. Earnings/(loss) per share
2025 2024
$'000 $'000
Profit/(loss) after income tax (72,913) 12,715
Profit/(loss) after income tax attributable to the owners of Litigation (72,913) 12,715
Capital Management Limited
Number Number
Weighted average number of ordinary shares used in calculating basic earnings 102,942,667 105,849,093
per share(1)
Adjustments for calculation of diluted earnings per share:
Amounts uncalled on partly paid shares - 1,301,770
Options over ordinary shares - 5,103,344
Weighted average number of ordinary shares used in calculating diluted 102,942,667 112,254,207
earnings per share
(1) Weighted average number of ordinary shares on issue during the year,
excludes treasury shares held
Cents Cents
Basic earnings/(loss) per share (70.83) 12.01
Diluted earnings/(loss) per share (70.83) 11.33
Dilutive potential shares which are contingently issuable are only included in
the calculation of diluted earnings per share where the conditions are met. As
at 30 June 2025, there were 6,107,174 shares calculated for inclusion in
diluted earnings per share, however these were not included due to their
anti-dilutive effect.
Note 9. Cash and cash equivalents
Consolidated
2025 2024
$'000 $'000
Cash at Bank 8,865 22,963
Investment securities held for liquidity purposes - 30,061
Cash of third-party interests in consolidated entities 9,582 15,089
18,447 68,113
Cash of third-party interests in consolidated entities is restricted as it is
held within the fund investment vehicles on behalf of the third-party
investors in these vehicles. The cash is restricted to use cashflows in the
litigation funding assets made on their behalf and costs of administering the
fund.
Note 10. Trade receivables
Consolidated
2025 2024
$'000 $'000
Due from litigation service 1,786 10,986
1,786 10,986
As at 30 June 2025, trade receivables are expected to be settled within 12
months after the Balance Sheet date.
Allowance for expected credit losses
The Group has recognised a loss of $nil (2024: $nil) in profit or loss in
respect of the expected credit losses for the year ended 30 June 2025.
Note 11. Due from resolution of investments
2025 2024
LCM Fund Consolidated LCM Fund Consolidated
$'000 $'000 $'000 $'000 $'000 $'000
At start of period 3,980 - 3,980 11,873 - 11,873
Recoveries on resolved investments (note 5) 49,672 94,105 143,777 44,027 58,359 102,386
Reimbursement of deployed capital 901 - 901 527 1,460 1,987
Proceeds from litigation funding assets (23,686) (31,136) (54,821) (52,480) (60,303) (112,782)
Foreign exchange gain (2,043) (3,592) (5,635) 32 483 516
Balance as at end of period 28,824 59,377 88,201 3,980 - 3,980
Effective from 1 July 2024, management has revised the presentation of amounts
due from resolution of investments to provide greater transparency over the
drivers of movements. The revised disclosure provides greater transparency by
disaggregating movements between LCM and the Fund, and by separately
identifying recoveries on resolved investments, proceeds from litigation
funding assets, and foreign exchange effects. As a result, the comparative
note disclosure for the year ended 30 June 2024 has been restated to
reallocate amounts between line items. Importantly, the overall balance of
amounts due from resolution of financial assets at the end of the prior period
remains unchanged.
As at 30 June 2025, amounts due from resolution of financial assets are
expected to be settled within 12 months after the Balance Sheet date.
Note 12. Contract costs - litigation contracts
2025 2024
$'000 $'000
Contract costs - litigation contracts 47,988 42,072
There are a small number of legacy investments which are still being recorded
under AASB 15 Revenue from Contracts with Customers due to the timing the
contracts were entered into. These are expected to resolve in the short to
medium term.
Reconciliation of litigation contract costs
Reconciliation of the contract costs at the beginning and end of the current
period and previous financial year are set out below:
2025 2024
$'000 $'000
Balance at 1 July 42,072 37,277
Additions during the period 11,384 8,030
Realisations of contract assets (5,468) (3,236)
Balance as at end of period 47,988 42,072
Additions during the year relate to matters that progressed to trial, which
required significant investment in their final stages.
The Group has recognised impairment losses of $5,468 (2024: $nil) in profit or
loss on contract costs for the period ended 30 June 2025.
Note 13. Investments
2025 2024
LCM Fund Consolidated LCM Fund Consolidated
$'000 $'000 $'000 $'000 $'000 $'000
At start of period 202,913 262,300 465,213 165,768 225,642 391,410
Deployments 35,969 60,165 96,134 43,393 47,523 90,916
Capital realised during the period (note 5) (27,485) (72,649) (100,134) (20,994) (19,615) (40,609)
Fair value removal on concluded investments (note 5) (49,020) (44,997) (94,017) (32,962) (16,644) (49,605)
Fair value write down on case losses under appeal (note 5) (44,536) (41,773) (86,309) - - -
Fair value movement on pre-hearing/trial ongoing investments (note 5) (6,824) (21,292) (28,115) 44,562 30,206 74,768
Foreign exchange movements 13,820 21,142 34,962 3,146 (4,813) (1,667)
Balance as at end of period 124,839 162,896 287,735 202,913 262,300 465,213
Effective from 1 July 2024, management has revised the presentation of
litigation funding assets, which are now disclosed under the heading
Investments (previously titled Litigation Funding Assets at fair value through
profit or loss). The revised disclosure provides greater transparency by
disaggregating movements between LCM and the Fund, and by separately
identifying capital realised, fair value write-offs on resolved and ongoing
investments, and foreign exchange effects. As a result, the comparative note
disclosure for the year ended 30 June 2024 has been restated to reallocate
amounts between line items. Importantly, the overall balance of these assets
at the end of the prior period remains unchanged.
Investments are financial instruments that relate to the provision of capital
in connection with legal finance. The Group fund through both direct
investments as well as using third party capital via a fund management model.
The table above sets forth the changes in litigation funding assets at the
beginning and end of the relevant reporting
periods.
Note 14. Trade and other payables
Consolidated
2025 2024
$'000 $'000
Trade payables 10,227 29,789
Other payables 281 587
10,508 30,376
Refer to note 20 for further information on financial instruments, including
the Group's exposure to liquidity risk.
Note 15. Borrowings
Consolidated
2025 2024
$'000 $'000
Borrowings 77,747 61,917
77,747 61,917
Reconciliation of borrowings of LCM:
2025 2024
$'000 $'000
Balance 1 July 61,917 68,976
Proceeds from borrowings 25,039 -
Repayment of borrowings (12,864) (8,139)
Payments for borrowing costs (487) (819)
Net accrued interest 5 648
Amortisation 611 1,221
Other non-cash items 1,522 -
Balance as at end of period 2,005 29
77,747 61,917
On 2 December 2024, LCM refinanced its credit facility with Northleaf Capital
Partners for an initial amount of US$75,000,000, AUD equivalent of
$114,136,000(1) (the "Facility"), with a potential to upsize by a further
US$75,000,000 (total US$150,000,000, AUD equivalent $228,272,000).
Interest is calculated by reference to the applicable currency benchmark,
being the US Federal Funds Rate for USD drawings, the Bank Bill Swap Reference
Rate (BBSY) for AUD drawings, and SONIA for GBP drawings (with fallback to the
Bank of England base rate), together with a 5.25% margin.
The Facility has an overall term of four years and is secured against LCM's
assets. As at 30 June 2025, LCM's outstanding utilisation amounted to
US$23,922,000 on the initial credit facility, an AUD equivalent of
$36,406,000(1).
LCM agreed to various debt covenants including a minimum effective net
tangible worth, borrowings as a percentage of effective net tangible worth,
minimum liquidity, a minimum consolidated EBIT and a minimum multiple of
invested capital on concluded contract assets over a specified period. There
have been no defaults or breaches related to the Facility during the period
ended 30 June 2025. Should LCM not satisfy any of these covenants, the
outstanding balance of the Facility may become due and payable.
LCM incurred costs in relation to arranging the Facility of $792,000 which
were reflected transactions costs and will be amortised over the 4 year term
of the borrowings. As at 30 June 2025, $685,000 of these loan arrangement fees
remained outstanding.
1 Converted at the functional currency spot rates of exchange at the
reporting date
Note 16. Financial liabilities related to
third-party interests in consolidated entities
2025 2024
$'000 $'000
Balance 1 July 264,950 243,990
Proceeds - capital contributions from Limited Partners 67,106 30,505
Payments - distributions to Limited Partners (33,959) (56,407)
Movement on financial liabilities related to third-party interests in (90,133) 48,382
consolidated entities (note 5)
Non-cash movements in third-party assets and liabilities 9,705 2,766
Foreign exchange movements 8,869 (4,288)
Balance as at end of period 226,538 264,950
Note 17. Equity - issued capital
2025 2024 2025 2024
Shares Shares $'000 $'000
Ordinary shares - fully paid 102,690,913 104,118,534 61,494 69,990
Ordinary shares - under loan share plan 11,590,384 12,331,148 (860) -
114,281,297 116,449,682 60,634 69,990
2025 2024
Movements in ordinary share capital Shares $'000 Shares $'000
Balance at 1 July 104,118,534 69,990 106,613,927 69,674
Options exercised 740,764 1,359 255,257 316
Share Buy-Back Programme (treasury shares) (2,168,385) - (2,750,650) -
Treasury shares cancelled - (9,854) - -
Balance at period end 102,690,913 61,494 104,118,534 69,990
The Group's share buyback programme which commenced on 5 October 2023,
completed on 8 November 2024.
Movements in ordinary shares issued under loan share plan ('LSP') and held by
Employee Benefit Trust:
2025 2024
Shares $'000 Shares $'000
Balance at 1 July 12,331,148 - 12,586,405 -
Options exercised (666,547) - (255,257) -
LSPs exercised (858,736) - - -
LSPs purchased by EBT 784,519 (860) - -
Balance at period end 11,590,384 (860) 12,331,148 -
Reconciliation of ordinary shares issued under LSP:
2025 2024
Total shares allocated under existing LSP arrangements with underlying LSP 6,642,872 7,501,608
shares (note 28)
Less shares allocated under existing LSP arrangements without underlying LSP (221,467) (221,467)
shares (note 28)
Shares held by LCM Employee Benefit Trust for future allocation under employee 5,168,979 5,051,007
share and option plans
11,590,384 12,331,148
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the
proceeds on the winding up of the Company in proportion to the number of and
amounts paid on the shares held. The fully paid ordinary shares have no par
value and the Company does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy
shall have one vote and upon a poll each share shall have one vote.
Ordinary shares - under loan share plan ('LSP')
The Company has an equity scheme pursuant to which certain employees may
access a LSP. The acquisition of shares under this LSP is fully funded by the
Company through the granting of a limited recourse loan. The shares under LSP
are restricted until the loan is repaid. The underlying options within the LSP
have been accounted for as a share-based payment. Refer to note 28 for further
details. When the loans are settled the shares are reclassified as fully paid
ordinary shares and the equity will increase by the amount of the loan repaid.
Ordinary shares - held by Employee Benefit Trust
The Employee Benefit Trust ('EBT') holds performance related shareholdings
awarded to former executive which did not vest. The Trust holds 5,168,979
shares which remain unallocated as at 30 June 2025 (2024: 5,051,007).
Ordinary shares - partly paid
As at 30 June 2025, there are currently 1,433,022 partly paid shares issued at
an issue price of $0.17 per share. No amount has been paid up and the shares
will become fully paid upon payment to the Company of $0.17 per share. As per
the terms of issue, the partly paid shares have no maturity date and the
amount is payable at the option of the holder.
Partly paid shares entitle the holder to participate in dividends and the
proceeds of the Company in proportion to the number of and amounts paid on the
shares held. The partly paid shares do not carry the right to participate in
new issues of securities. Partly paid shareholders are entitled to receive
notice of any meetings of shareholders. The partly paid shareholders are
entitled to vote in the same proportion as the amounts paid on the partly paid
shares bears to the total amount paid and payable.
Treasury shares
As at 30 June 2025, there were nil treasury shares (2024: 2,750,650) which has
resulted in nil being deducted from equity (2024: $5,396,000). Treasury shares
comprised shares bought back from shareholders which were held by Canaccord on
behalf of LCM and classified as treasury shares. All treasury shares were
cancelled in November 2024.
Capital risk management
The Group's objectives when managing capital is to safeguard its ability to
continue as a going concern, so that it can provide returns for shareholders
and benefits for other stakeholders and to maintain an optimum capital
structure to reduce the cost of capital.
Capital is regarded as total equity as recognised in the statement of
financial position.
In order to maintain or adjust the capital structure, the Group may adjust the
amount of dividends paid to shareholders, return capital to shareholders,
issue new shares or sell assets to reduce debt.
The capital risk management policy remains unchanged from the 30 June 2024
Annual Report.
Note 18. Equity - reserves
Movements in reserves
Movements in each class of reserve during the current and previous financial
year are set out below:
Consolidated Share based Foreign Total
payments currency reserves
reserve translation
$'000 $'000 $'000
Balance at 1 July 2023 2,440 (1,398) 1,042
Movements in reserves during the period 800 2,013 2,813
Balance at 30 June 2024 3,240 615 3,855
Movements in reserves during the period (146) 5,128 4,983
Balance at 30 June 2025 3,094 5,743 8,838
Share-based payments reserve
The reserve is used to recognise the value of equity benefits provided to
employees and Directors as part of their remuneration, and other parties as
part of their compensation for services.
Foreign currency translation reserve
This reserve is used to record differences on the translation of the assets
and liabilities of foreign operations.
Note 19. Equity - dividends
2025 2024
$'000 $'000
Ordinary dividend paid (2025: 1.25 cents, 2024: 2.25 cents) 2,680 4,976
Franking credits
The franking credits available to the Group as at 30 June 2025 are $5,000
(2024:
$338,000).
Note 20. Financial instruments
Financial risk management objectives
The Group's activities expose it to a variety of financial risks: market risk
(including foreign currency risk, price risk and interest rate risk), credit
risk and liquidity risk. The Group's overall risk management program focuses
on the unpredictability of financial markets and seeks to minimise potential
adverse effects on the financial performance of the Group. The Group uses
different methods to measure different types of risk to which it is exposed.
These methods include sensitivity analysis in the case of interest rate,
foreign exchange and other price risks and ageing analysis for credit risk.
Risk management is carried out by senior finance executives ('finance') under
policies approved by the Board of Directors ('the Board'). These policies
include identification and analysis of the risk exposure of the Group and
appropriate procedures, controls and risk limits. Finance identifies,
evaluates and hedges financial risks within the Group's operating units.
Finance reports to the Board on a monthly basis.
Financial instruments of the Group is comprised of litigation funding assets
classified as financial assets at FVTPL and financial liabilities at FVTPL
related to third party interests with the remaining financial instruments held
at amortised cost.
Market risk
Foreign currency risk
The carrying amount of the Group's foreign currency denominated financial
assets and financial liabilities at the reporting date were as
follows:
Assets Liabilities Assets Liabilities
2025 2025 2024 2024
Consolidated $'000 $'000 $'000 $'000
US dollars 123,298 (41,950) 168,570 (68,550)
Pound Sterling 9,359 (20,150) 2,751 (437)
Singapore Dollars 469 - 24 (20)
Other 60 (72) 7 (4)
133,186 (62,172) 171,352 (69,012)
The Group had net assets denominated in foreign currencies of $71,014,000
(assets of $133,186,000 less liabilities of $62,172,000) as at 30 June 2025
(2024: net assets $102,340,000). Based on this exposure, had the Australian
dollars weakened or strengthened by 10% against these foreign currencies with
all other variables held constant, the Group's profit before tax for the year
would have increased and decreased respectively by $7,101,000 (2024:
$10,234,000). The percentage change is the expected overall volatility of the
significant currencies, which is based on management's assessment of
reasonable possible fluctuations taking into consideration movements over the
last 12 months. The actual realised foreign exchange loss for the year ended
30 June 2025 was $1,053,000 (2024: loss of 2,934,000). The movement in the
foreign currency translation reserve for the year ended 30 June 2025 was a
gain of $5,128,000 (2024: gain $2,013,000).
Foreign exchange risk arises mainly from litigation funding assets and
borrowings which are denominated in a currency that is not the functional
currency in which they are measured. The risk is monitored using sensitivity
analysis and cash flow forecasting. The Group's contract cost assets are not
hedged as those currency positions are considered to be long term in nature.
Interest rate risk
The Group is exposed to changes in market interest rates primarily through:
· Cash holdings with a floating interest rate; and
· A US$75,000,000 million (AUD equivalent of $114,136,000(1)) variable
rate debt facility, which includes fixed capitalised borrowing costs as at 30
June 2025.
As disclosed in Note 15, LCM refinanced its credit facility with Northleaf
Capital Partners on 2 December 2024. The four-year facility bears interest at
the relevant rate plus 5.25% and replaced the Group's previous fixed-rate
borrowings, creating new exposure to variable interest rate risk.
At 30 June 2025, the Group's financial instruments subject to variable
interest rate risk were:
2025 2024
$'000 $'000
Cash & cash equivalents 18,447 68,113
Borrowings (77,747) -
Net exposure (59,300) 68,113
The Group monitors interest rate exposures across all currencies, considering
expected market movements, cash requirements, refinancing options and the mix
of fixed and variable rate borrowings.
The following sensitivity analysis is based on the interest rate risk
exposures in existence at the reporting date.
At 30 June 2025, if interest rates had moved with all other variables held
constant, post-tax profit and equity would have been affected as follows:
Post tax profit Equity
2025 2024 2025 2024
$'000 $'000 $'000 $'000
100bps higher interest rates (415) 477 (415) 477
100bps lower interest rates 415 (477) 415 (477)
Credit risk
Credit risk refers to the risk that on becoming contractually entitled to a
settlement or award a defendant will default on its contractual obligation to
pay resulting in financial loss to the Group. The Group assesses the
defendants in the matters funded by the Group prior to entering into any
agreement to provide funding and continues this assessment during the course
of funding. Whenever possible the Group ensures that security for settlements
sums is provided, or the settlements funds are placed into solicitors' trust
accounts. However, the Group's continual monitoring of the defendants'
financial capacity mitigates this risk.
The maximum credit risk exposure represented by cash, cash equivalents, trade
and other receivables, due from resolution of financial assets and contract
costs is specified in the consolidated statements of financial position. The
exposure for financial assets held at amortised cost is the carrying amount,
net of any provisions for impairment of those assets, which includes cash,
cash equivalents and trade and other receivables. The Group does not hold any
collateral. For financial assets measured at fair value, credit risk is
incorporated into the valuation techniques applied (refer note 21).
To mitigate credit risk on cash and cash equivalents, the Group holds cash
with Australian and American financial institutions with at least an AA-
credit rating.
The Group applies the simplified approach to recognise impairment on
settlement and receivable balances based on the lifetime expected credit loss
at each reporting date. The Group reviews the lifetime expected credit loss
rate based on historical collection performance, the specific provisions of
any settlement agreement, assessments of recoverability during the due
diligence process and a forward-looking assessment of macro-economic factors
however note that the Group's operations are generally uncorrelated to market
conditions and therefore has little to no impact on the recoverability of the
Group's financial assets.
For trade receivables and due from resolution of financial assets, at every
reporting date, the Group evaluates whether the trade receivables and due from
resolution of financial assets is considered to have low credit risk using all
reasonable and supportable information that is available without undue cost or
effort. In making that evaluation, the Group reassesses indicators of changes
in credit quality of their counterparties. In addition, the Group considers
that there has been a significant increase in credit risk when contractual
payments are more than 90 days past due or if sufficient indicators exist that
the debtor is unlikely to pay. Refer to note 10 and 11 for the respective
notes on these items. Generally, trade receivables are written off when there
is no reasonable expectation of recovery. Indicators of this include the
failure of a debtor to engage in a repayment plan, no active enforcement
activity and a failure to make contractual payments for a period greater than
1 year.
Management also monitors whether there has been a significant increase in
credit risk of LFAs relative to initial recognition. This assessment is
performed through ongoing review of case progression, achievement of key
milestones, counterparty performance, and enforceability of settlements or
awards. Where significant increases in credit risk are identified, these are
reflected in the fair value measurement through reductions in expected cash
flows or, where recovery is no longer expected, a full write-off of the asset.
As at the reporting date, no significant increases in credit risk beyond those
already incorporated into the fair value measurement have been identified.
Liquidity risk
Vigilant liquidity risk management requires the Group to maintain sufficient
liquid assets (mainly cash and cash equivalents) to be able to pay debts as
and when they become due and payable.
The Group manages liquidity risk by maintaining adequate cash reserves and by
continuously monitoring actual and forecast cash flows and matching the
maturity profiles of financial assets and liabilities.
Remaining contractual
maturities
The maturity profile of the Group's financial liabilities based on contractual
maturity on an undiscounted basis are:
Less than 1 year Between 1 and 5 years Over 5 years No contractual maturity date Total
Consolidated - 2025 $'000 $'000 $'000 $'000 $'000
Financial liabilities
Trade payables 10,221 - - - 10,221
Other payables 286 - - - 286
Borrowings 8,396 97,381 - - 105,777
Third-party interest in consolidated entities - - - 226,538 226,538
Total non-derivatives 18,903 97,381 - 226,538 342,822
Less than 1 year Between 1 and 5 years Over 5 years No contractual maturity date Total
Consolidated - 2024 $'000 $'000 $'000 $'000 $'000
Financial liabilities
Trade payables 29,752 - - - 29,752
Other payables 624 - - - 624
Borrowings 68,200 - - 68,200
Third-party interest in consolidated entities - - - 264,950 264,950
Total non-derivatives 98,576 - - 264,950 363,526
Note 21. Fair value measurements
The fair value measurements used for all assets and liabilities held by the
Group listed below are level 3:
Assets 2025 2024
Litigation funding assets $'000 $'000
APAC 81,220 111,662
EMEA 206,515 353,551
Total Level 3 assets 287,735 465,213
Liabilities
Financial liabilities related to third-party interests in consolidated 226,538 264,950
entities
Total Level 3 liabilities 226,538 264,950
Refer note 13 for movements in level 3 assets and note 16 for movements in
level 3 liabilities. There were no transfers into or out of level 3 during the
period ended 30 June 2025.
As at 30 June 2025, the financial liability due to third-party interests is
$226,538,000 (2024: $264,950,000), recorded at fair value as represented in
note 16. Amounts included in the consolidated statement of financial position
represent the fair value of the third-party interests in the related financial
assets and the amounts included in the consolidated statement of profit or
loss and other comprehensive income represent the third-party share of any
gain or loss during the period, see note 4.
Sensitivity of Level 3 Valuations
The Group's fair value policy provides for ranges of percentages to be applied
against the risk adjustment factor to more than 159 discrete objective
litigation events. The tables below set forth each of the key unobservable
inputs used to value the Group's LFA assets and the applicable ranges and
weighted average by relative fair value for such inputs.
The Group implemented a new valuation methodology for LFA assets during the
year ended 30 June 2023. LFA assets are fair valued using an income approach
which is the technique adopted for LFA Assets. Under the income approach,
future cash flows associated with; cash out flows, including investments and
deployments, and cash inflows such as settlements or resolutions, are
converted to a single current (discounted) amount, reflecting current market
expectations about those future amounts. That is, the amount that could
reasonably be expected to be paid to acquire the asset at that point in time.
In developing our framework we also looked to Industry peers for alignment in
methodology, the benefit being that adopting a similar methodology provides a
level of comparability. Similar to industry peers, the framework developed
applied probabilities based on observable milestones for each investment
within the portfolio as well as making informed assumptions around inputs such
as discount rates, timing and risk factors, all of which are considered Level
3 inputs. In cases where cash flows are denominated in a foreign currency,
forecasts are developed in the applicable foreign currency and translated to
AUD dollars.
A Discounted Cash Flow approach is then applied to each underlying investment
on an individual basis to arrive at a net present value of the future expected
cash flows.
The cash flow forecast is updated each reporting period, based on the best
available information on progress of the underlying matter at the time. These
objective events could include, among others:
- Stage of the investment
- ongoing developments
- progress
- recovery or sovereign risk
- legal team expertise
- other factors impacting the expected outcome
Each reporting period, the updated risk-adjusted cash flow forecast is then
discounted at the then current discount rate to measure fair value. The
discount rate includes an applicable risk-free rate and credit spread to
incorporate both market and idiosyncratic asset-class risk.
The Group's fair value policy provides for ranges of percentages to be applied
against the risk adjustment factor to more than 159 discrete objective
litigation events. The tables below set forth each of the key unobservable
inputs used to value the Group's LFA assets and the applicable ranges and
weighted average by relative fair value for such inputs.
30 June 2025
Item Valuation technique Unobservable Input(1) Min Max Weighted average
Litigation funding asset Discounted cash flow Discount rate 10.2% 10.9% 10.6%
Duration (years) 2.42 7.67 5.45
Adjusted risk premium (60%) 80% 10%
Adjusted risk premium - case milestone Min(2) Max(2) ( ) Weighted average % of portfolio(3)
Pre-commencement & commenced 0% 0% 0% 56%
Pleadings 0% 10% 2% 9%
Discovery & evidence 10% 20% 15% 10%
Significant ruling or other objective event prior to trial court judgment 20% 65% 64% 6%
Settlement 90% 90% 0% 0%
Trial court judgment or tribunal award (100%) 75% (22%) 8%
Appeal judgment (100%) 80% (46%) 8%
Enforcement 80% 80% 80% 3%
30 June 2024
Item Valuation technique Unobservable Input(1) Min Max Weighted average
Litigation funding asset Discounted cash flow Discount rate 12.8% 12.8% 12.8%
Duration (years) 0.75 7.08 4.57
Adjusted risk premium 0% 85% 17%
Adjusted risk premium - case milestone Min(2) Max(2) ( ) Weighted average % of portfolio(3)
Pre-commencement & commenced 0% 20% 29% 48%
Pleadings 5% 35% 20% 12%
Discovery & evidence 20% 40% 25% 9%
Significant ruling or other objective event prior to trial court judgment 25% 80% 47% 7%
Settlement 70% 85% 80% 1%
Trial court judgment or tribunal award 0% 85% 63% 9%
Appeal judgment 0% 85% 3% 12%
Enforcement 75% 85% 83% 3%
1 Refer note 3 for refinements made to the valuation methodology during the
period
2 Minimum and maximum within each cohort represent the actual adjusted risk
premiums applied in the period
3 Percentage of portfolio represents the percentage of the book within the
cohort
At each reporting period, the Group reviews the fair value of each litigation
funding asset in connection with the preparation of the consolidated financial
statements. A fair value of 10% higher or lower, while all other variables
remain constant, in financial assets at fair value through profit or loss
would have increased or decreased the Group's income and net assets by
$28,774,000 as at 30 June 2025 (30 June 2024: $46,521,000). Similarly, a fair
value of 10% higher or lower, while all other variables remain constant, in
financial liabilities at fair value through profit or loss would have
increased or decreased the Group's income and net assets by $22,654,000 as at
30 June 2025 (30 June 2024: $26,495,000).
At 30 June 2025, should discount rates been 50 bps or 100 bps higher or lower
than the actual discount rate used in the fair value estimation, while all
other variables remained constant, consolidated income and net assets would
have increased and decreased by the following
amounts:
2025 2024
Hypothetical Change $'000 $'000
100bps lower interest rates 519 5,441
50bps lower interest rates 257 2,743
100bps higher interest rates (502) (5,440)
50bps higher interest rates (253) (2,736)
Reasonably possible alternative assumptions
The determination of fair value for litigation funding assets involves
significant judgements and estimates. While the potential range of outcomes
for the assets is wide, the Group's fair value estimation is its best
assessment of the current fair value of each asset, as applicable. Such
estimate is inherently subjective, being based largely on an assessment of how
individual events have changed the possible outcomes of the asset, as
applicable, and their relative probabilities and hence the extent to which the
fair value has altered. The aggregate of the fair values selected falls within
a wide range of reasonably possible estimates. In the Group's opinion, there
is no useful alternative valuation that would better quantify the market risk
inherent in the portfolio and there are no inputs or variables to which the
values of the assets are correlated other than interest rates which impact the
discount rates applied.
Note 22. Key management personnel disclosures
Compensation
The aggregate compensation made to Directors and other members of key
management personnel of the Group is set out below:
Consolidated
2025 2024
$ $
Short-term employee benefits 2,918,408 2,844,106
Post-employment benefits 54,934 67,584
Long-term benefits 12,291 28,975
Share-based payments 402,653 408,583
3,388,286 3,349,249
Details of the remuneration of key management personnel of the Group are set
out in the following tables.
Cash salaries and fees Bonus Benefits Accrued leave Superannua- Long service leave Share-based payments Total
tion/
Pension
2025 $ $ $ $ $ $ $ $
Non-executive Directors
Dr David King 115,594 - - - 13,293 - - 128,887
Jonathan Moulds 230,576 - - - - - - 230,576
Gerhard Seebacher(1) 70,492 - - - - - - 70,492
416,661 - - - 13,293 - - 429,954
Executive directors & other executives
Patrick Moloney 1,209,885 117,295 156,954 56,298 13,393 12,291 402,653 1,968,768
David Collins(2) 698,580 - 188 - 1,994 - - 700,762
Mary Gangemi(3) 262,547 - - - 26,255 - - 288,802
2,171,012 117,295 157,143 56,298 41,641 12,291 402,653 2,958,332
2,587,673 117,295 156,954 56,298 54,934 12,291 402,653 3,388,286
1 Resigned as Director 15 January 2025
2 Appointed as Director 29 November 2024
3 Resigned as Director 5 September 2024. The amounts disclosed for Ms Gangemi
represent payments made in connection with her cessation of employment,
including notice period entitlements, and are classified as termination
benefits.
Cash salaries and fees Bonus Benefits Accrued leave Superannua-tion/ Long service leave Share-based payments Total
Pension
2024 $ $ $ $ $ $ $ $
Non-executive Directors
Dr David King 111,458 - - - 12,302 - - 123,760
Jonathan Moulds 214,255 - - - - - - 214,255
Gerhard Seebacher 127,377 - - - - - - 127,377
453,091 - - - 12,302 - - 465,393
Executive directors & other executives
Patrick Moloney 1,316,062 183,783 114,754 36,864 - 28,975 199,145 1,879,583
David Collins(1) 22,921 - - - - - - 22,921
Mary Gangemi(2) 552,818 163,814 - - 55,282 - 209,438 981,352
1,891,800 347,597 114,754 36,864 55,282 28,975 408,583 2,883,856
2,344,891 347,597 114,754 36,864 67,584 28,975 408,583 3,349,249
1 David Collins appointed as Chief Financial Officer on 18 June 2024 on a base
salary of £350,000 (AUD equivalent $672,000). Refer note 25 for details on
amounts paid to Greatham Advisors Limited, a related entity of David Collins,
for Investor Relation services prior to David becoming an employee. David
Collins has not been appointed as a Director as at 30 June 2024.
2 Stepped down as Chief Financial Officer 18 June 2024 and resigned as
Director 5 September 2024
Directors' share options
The details of options over ordinary shares in the Company held during the
financial year by each Director is set out below:
Name of the Director Grant date Expiry date Exercise price Balance at the start of the year Granted Exercised Expired/ Balance at the end of the year
forfeited/ other
Patrick Moloney 19/11/2018 25/11/2028 $0.47 1,595,058 - - - 1,595,058
Patrick Moloney 04/12/2017 04/12/2027 $0.60 1,000,000 - - - 1,000,000
Patrick Moloney 04/12/2017 04/12/2027 $0.60 1,000,000 - - - 1,000,000
Patrick Moloney 01/11/2019 01/11/2029 £0.7394 777,600 - - - 777,600
Patrick Moloney 13/10/2020 13/10/2030 £0.6655 291,597 - - - 291,597
Patrick Moloney 27/10/2021 27/10/2031 £1.06 279,232 - - - 279,232
Patrick Moloney(1) 27/10/2021 27/10/2031 £1.06 900,000 - - - 900,000
Mary Gangemi(2) 27/10/2021 27/10/2031 £1.06 93,585 - - - 93,585
Mary Gangemi(2) 27/10/2021 27/10/2031 £1.14 26,315 - - - 26,315
Patrick Moloney 07/10/2022 07/10/2032 - 169,276 - (112,850) - 56,426
Patrick Moloney 07/10/2022 07/10/2032 - 3,303,796 - - - 3,303,796
Mary Gangemi(2) 07/10/2022 07/10/2032 - 134,217 - - - 134,217
Mary Gangemi(2) 07/10/2022 07/10/2032 - 1,266,455 - - - 1,266,455
Patrick Moloney 04/10/2023 04/10/2033 - 167,043 - (55,681) - 111,362
Mary Gangemi(2) 04/10/2023 04/10/2033 - 148,893 - - - 148,893
Patrick Moloney 04/10/2024 04/10/2034 - - 122,302 - - 122,302
11,153,067 122,302 (168,531) - 11,106,838
1 On 27 October 2021, Patrick Moloney exercised 900,000 unlisted options at an
exercise price of A$1.00 which were granted under the Employee share option
scheme. Upon exercise, the Group issued 900,000 new ordinary shares in the
capital of the Group to Patrick Moloney which have been granted under the Loan
Share Plan with the sole purpose to fund the exercise price of the 900,000
unlisted options
2 Outstanding share options as disclosed in Note 28.
3 Resigned as Director 5 September 2024
Directors' interests
The number of shares in the Company held at the end of the financial year by
each Director is set out
below:
Name of the Director Description of shares 30 June 2025 30 June 2024
Number Number
Jonathan Moulds Fully paid ordinary shares 5,250,000 5,250,000
Dr David King Fully paid ordinary shares 1,951,484 1,951,484
Patrick Moloney Fully paid ordinary shares 4,312,353 4,219,813
Patrick Moloney Unlisted partly paid shares(1) 1,433,022 1,433,022
David Collins N/A - -
Mary Gangemi Fully paid ordinary shares - 64,348
Gerhard Seebacher N/A - -
1 The 30 June 2024 comparative disclosure has been corrected in the current
year to reflect the accurate number of shares, being an increase of 15,000
shares. This change relates only to disclosure and does not affect the total
issued share capital of the Group.
2 Unlisted partly paid shares in the Company were issued at a price of $0.17
per share, wholly unpaid and will convert to a share upon payment to the
Company of $0.17 per share. Further details provided in Note 17 to the
financial statements.
No changes took place in the interest of the directors between 30 June 2025
and 1 October 2025.
Note 23. Remuneration of auditors
During the financial year the following fees were paid or payable for services
provided by BDO Audit Pty Ltd, the auditor of the Company, and its network
firms:
Consolidated
2025 2024
$ $
Audit Services - BDO Audit Pty Ltd
Audit or review of financial report 186,560 253,727
186,560 253,727
Audit Services - Firms related to BDO Audit Pty Ltd
Audit of statutory report of controlled entities 182,626 186,721
182,626 186,721
Audit Services - Unrelated Firms
Audit of statutory report of controlled entities 75,668 64,625
75,668 64,625
Note 24. Contingent liabilities
The majority of the Group's funding agreements contain a contractual indemnity
from the Group to the funded party that the Group will pay adverse costs
awarded to the successful party in respect of costs incurred during the period
of funding, should the client's litigation be unsuccessful. The Group's
position is that for the majority of litigation projects which are subject to
funding, the Group enters into insurance arrangements which lessen or
eliminate the impact of such awards and therefore any adverse costs order
exposure.
Note 25. Related party transactions
The following transactions occurred with related
parties:
Consolidated
2025 2024
$ $
Consulting fees paid to Greatham Advisors Limited - a related entity of David - 47,957
Collins
- 47,957
David Collins is a shareholder and director of Greatham Advisors Limited,
which carries out Investor Relations services. The services provided by
Greatham Advisors Limited ceased once David Collins became an employee of the
Group on 18 June 2024. As at 30 June 2025 there were no amounts owing to
Greatham Advisors Limited (2024: $nil).
Note 26. Parent entity information
Set out below is the supplementary information about the parent entity,
Litigation Capital Management Limited.
Statement of profit or loss and other comprehensive income Consolidated
2025 2024
$'000 $'000
Profit/(loss) after income tax 10,792 50,491
Total comprehensive income 10,792 50,491
Statement of financial position
Total assets 99,710 103,055
Total liabilities (10,114) (20,390)
Equity
Issued capital 60,634 64,278
Share based payments reserve 3,095 3,556
Retained earnings 25,868 14,831
Total equity 89,596 82,665
Guarantees entered into by the parent entity in relation to the debts of its
subsidiaries
Litigation Capital Management Limited (as holding entity), LCM Operations Pty
Ltd, LCM Litigation Fund Pty Ltd, LCM Corporate Services Pty Ltd, LCM
Recoveries Pty Ltd, LCM Funding Pty Ltd, LCM Singapore Pty Ltd, LCM Funding SG
Pty Ltd and LCM Group Holdings Pty Ltd are parties to a deed of cross
guarantee under which each company guarantees the debts of the others. The
specified subsidiaries represent a 'closed group' for the purposes of the
guarantee, and as there are no other parties to the Deed that are controlled
by the Group, they also represent the 'extended closed group'.
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2025 and 30 June
2024.
Capital commitments - Property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment
as at 30 June 2025 and 30 June 2024.
Material accounting policies
The accounting policies of the parent entity are consistent with those of the
Group, as disclosed in note 2, except for the following:
· Investments in subsidiaries are accounted for at cost, less any impairment, in
the parent entity.
· Dividends received from subsidiaries are recognised as other income by the
parent entity and its receipt may be an indicator of an impairment of the
investment.
Note 27. Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and
results of the following subsidiaries in accordance with the accounting policy
described in note
2:
Principal place of business / Country of incorporation Ownership Interest
Country of incorporation
2025 2024
Name % %
LCM Litigation Fund Pty Ltd Australia 100% 100%
LCM Operations Pty Ltd Australia 100% 100%
LCM Corporate Services Pty Ltd Australia 100% 100%
LCM Singapore Pty Ltd Australia 100% 100%
LCM Recoveries Pty Ltd Australia 100% 100%
LCM Advisory Limited Australia 100% 100%
LCM Funding Pty Ltd Australia 100% 100%
LCM Funding SG Pty Ltd Australia 100% 100%
LCM Corporate Services Pte. Ltd. Singapore 100% 100%
LCM Operations UK Limited United Kingdom 100% 100%
LCM Corporate Services UK Limited United Kingdom 100% 100%
LCM Recoveries UK Limited United Kingdom 100% 100%
LCM Funding UK Limited United Kingdom 100% 100%
LCM Group Holdings Pty Ltd Australia 100% 100%
ASG Ghana Limited Ghana 100% N/A
LCM Global Alternative Returns Fund
LCM Global Alternative Returns Fund GP Limited Jersey 100% 100%
LCM Global Alternative Returns Fund (Special Partner) LP Jersey 100% 100%
LCM Global Alternative Returns Fund II
LCM Global Alternative Returns Fund II GP Limited Jersey 100% 100%
LCM Global Alternative Returns Fund II (Special Partner) LP Jersey 100% 100%
Note 28. Share-based payments
The share-based payment expense for the period was $1,212,000 (2024:
$1,116,000).
Loan Funded Share Plans ('LSP')
As detailed in note 17, the Group has an equity scheme pursuant to which
certain employees may access a LSP. The shares under LSP are issued at the
exercise price by granting a limited recourse loan. The LSP shares are
restricted until the loan is repaid. Options under this scheme can be granted
without an underlying LSP share until they have been exercised and on this
basis, do not form part of the Group's issued share capital. The underlying
options have been accounted for as a share-based payments. The options are
issued over a 1-3 year vesting period. Vesting conditions include satisfaction
of customary continuous employment with the Group and may include a share
price hurdle.
During the period the Group granted nil (2024: nil) shares under the LSP.
Set out below are summaries of shares/options granted under the
LSP:
2025
Grant date Expiry date Exercise Balance at the start of the period Granted Exercised Expired/ Balance at the end of the period
Price
forfeited/
other
04/12/2017 04/12/2027 $0.60 2,000,000 - - - 2,000,000
31/08/2018 31/08/2028 $0.77 411,972 - (411,972) - -
19/11/2018 25/11/2028 $0.47 1,595,058 - - - 1,595,058
03/12/2018 03/12/2028 $0.89 100,000 - - - 100,000
01/11/2019 01/11/2029 £0.7394 1,043,953 - (125,259) - 918,694
13/10/2020 13/10/2030 £0.6655 616,520 - (158,296) - 458,224
27/10/2021 27/10/2031 £1.06 1,512,638 - (163,209) - 1,349,429
27/10/2021 27/10/2031 £1.06 99,037 - - - 99,037(1)
27/10/2021 27/10/2031 £1.14 122,430 - - - 122,430(1)
7,501,608 - (858,736) - 6,642,872
(1)Options granted without an underlying LSP share until exercised ie, do not
form part of the Group's issued share capital
Weighted average exercise price $1.089 $0.000 $1.240 $0.000 $1.113
2024
Grant date Expiry date Exercise Balance at the start of the period Granted Exercised Expired/ Balance at the end of the period
Price
forfeited/
other
04/12/2017 04/12/2027 $0.60 2,000,000 - - - 2,000,000
31/08/2018 31/08/2028 $0.77 411,972 - - - 411,972
19/11/2018 25/11/2028 $0.47 1,595,058 - - - 1,595,058
03/12/2018 03/12/2028 $0.89 100,000 - - - 100,000
01/11/2019 01/11/2029 £0.7394 1,432,753 - - (388,800) 1,043,953
13/10/2020 13/10/2030 £0.6655 616,520 - - - 616,520
27/10/2021 27/10/2031 £1.06 1,512,638 - - - 1,512,638
27/10/2021 27/10/2031 £1.06 99,037 - - - 99,037(1)
27/10/2021 27/10/2031 £1.14 122,430 - - - 122,430(1)
7,890,408 - - (388,800) 7,501,608
Weighted average exercise price $1.049 $0.000 $0.000 $1.420 $1.089
(1)Options granted without an underlying LSP share until exercised ie, do not
form part of the Group's issued share capital
There were 6,642,872 options vested and exercisable as at 30 June 2025 (2024:
7,501,608).
The weighted average remaining contractual life of options under LSP
outstanding at the end of the financial year was 0.759 years (2024: 0.892
years).
Deferred Bonus Share Plan ('DBSP')
The Company has in place a DBSP. Options granted under the DBSP reflect past
performance and are in the form of nil cost options and will vest in three
equal tranches from the date of issue and are subject to continued employment
over the three year period.
In addition, the Options granted under the DBSP are subject to malus and
clawback provisions. In the event of a change of control of the Company,
unvested awards will vest to the extent determined by the Board, taking into
account the proportion of the period of time between grant and the normal
vesting date that has elapsed at the date of the relevant event.
During the period the Group granted 532,235 (2024: 771,911) options under the
DBSP.
Set out below are summaries of options granted under the DBSP:
2025
Grant date Expiry date Exercise Balance at the start of the period Granted Exercised Expired/ Balance at the end of the period
Price
forfeited/
other
07/10/2022 07/10/2032 $0.00 877,435 - (442,468) - 434,967
04/10/2023 04/10/2033 $0.00 771,911 - (224,079) - 547,832
04/10/2024 04/10/2034 $0.00 - 532,235 - - 532,235
1,649,346 532,235 (666,547) - 1,515,034
Weighted average exercise price $0.000 $0.000 $0.000 $0.000 $0.000
2024
Grant date Expiry date Exercise Balance at the start of the period Granted Exercised Expired/ Balance at the end of the period
Price
forfeited/
other
07/10/2022 07/10/2032 $0.00 1,132,692 - (255,257) - 877,435
04/10/2023 04/10/2033 $0.00 - 771,911 - - 771,911
1,132,692 771,911 (255,257) - 1,649,346
Weighted average exercise price $0.000 $0.000 $0.000 $0.000 $0.000
There were 634,868 options vested (2024: 377,564) and 666,547 exercised
(average share price $2.054) as at 30 June 2025 (2024: 255,257. Average share
price $1.956).
The weighted average remaining contractual life of options under DBSP
outstanding at the end of the financial year was 0.817 years (2024: 0.814
years).
Executive Long Term Incentive Plan ('LTIP')
The Company has in place an Executive LTIP. Options over ordinary shares in
the capital of the Company ("Ordinary Shares") are issued to recipients under
the LTIP plan. The options set out above have been granted under the LTIP in
the form of nil cost options and are subject to performance conditions which
require the growth of Funds under Management ('FuM') over a five year
performance period. The performance conditions associated with the options are
set out below:
(1) 50% vesting on reaching a minimum of FuM of US$750m; and
(2) 100% vesting on reaching FuM of US$1bn.
The vesting date of options granted is the later of:
(1) the third anniversary of the Grant Date;
(2) the satisfaction of the Performance Condition; or
(3) the date of any adjustment under the Plan rules of the Plan at the
Boards discretion.
Any awards made to the participants are subject to a five year holding period
from the grant date. In the event of a change of control of the Company,
unvested awards will vest to the extent determined by the Board, taking into
account the proportion of the period of time between grant and the normal
vesting date that has elapsed at the date of the relevant event and the extent
to which any performance condition has been satisfied at the date of the
relevant event.
During the period the Group granted nil (2024: nil) options under the LTIP.
Set out below are summaries of shares/options granted under the
LTIP:
2025
Grant date Expiry date Exercise Balance at the start of the period Granted Exercised Expired/ Balance at the end of the period
Price
forfeited/
other
07/10/2022 07/10/2032 $0.0000 5,671,516 - - - 5,671,516
5,671,516 - - - 5,671,516
Weighted average exercise price $0.000 $0.000 $0.000 $0.000 $0.000
2024
Grant date Expiry date Exercise Balance at the start of the period Granted Exercised Expired/ Balance at the end of the period
Price
forfeited/
other
07/10/2022 07/10/2032 $0.0000 5,671,516 - - - 5,671,516
5,671,516 - - - 5,671,516
Weighted average exercise price $0.000 $0.000 $0.000 $0.000 $0.000
There were nil LTIP's vested and exercisable as at 30 June 2025 (2024: nil).
The weighted average remaining contractual life of options under DBSP
outstanding at the end of the financial year was 0.263 years (2024: 1.263
years).
For the options under LSP granted during the current period, the valuation
model inputs used in the Black-Scholes pricing model to determine the fair
value at the grant date, are as follows:
Grant date Expiry date Share price at grant date Exercise price Expected volatility Dividend yield Risk-free interest rate Fair value at grant date
04/10/2024 04/10/2034 £0.98 £0.00 35.00% 1.10% 4.30% £0.9478
The expected volatility reflects the assumption that the historical volatility
over a period similar to the life of the options is indicative of future
trends, which may not necessarily be the actual
outcome.
Note 29. Events after the reporting period
On 18 September 2025, the Group announced the termination of its investment in
the class action brought on behalf of commercial fishermen against Gladstone
Ports Corporation. The settlement, which is subject to Court approval in
October 2025, provides for a full release of claims and a payment of a portion
of Gladstone Ports Corporation's costs, which will be covered by After the
Event Insurance.
The investment was carried at A$30.8 million, equal to the cash invested, and
will now be written off. The Group is pursuing potential avenues for recovery,
including a costs assessment and possible claims against the former solicitors
involved in the matter.
Consolidated entity disclosure statement
For the year ended 30 June
2025
Name Type of entity Trustee, partner, or participant in joint venture % of share capital held Country of incorporation Australian resident or foreign resident (for tax purposes) Foreign tax jurisdiction of foreign residents
Litigation Capital Management Limited Body corporate n/a n/a Australia Australia n/a
LCM Litigation Fund Pty Ltd Body corporate n/a 100% Australia Australia n/a
LCM Operations Pty Ltd Body corporate n/a 100% Australia Australia n/a
LCM Corporate Services Pty Ltd Body corporate n/a 100% Australia Australia n/a
LCM Singapore Pty Ltd Body corporate n/a 100% Australia Australia n/a
LCM Recoveries Pty Ltd Body corporate n/a 100% Australia Australia n/a
LCM Advisory Limited Body corporate n/a 100% Australia Australia n/a
LCM Funding Pty Ltd Body corporate Trustee(1) 100% Australia Australia n/a
LCM Funding SG Pty Ltd Body corporate Trustee(1) 100% Australia Australia n/a
LCM Corporate Services Pte. Ltd. Body corporate n/a 100% Singapore Australia n/a
LCM Group Holdings Pty Ltd Body corporate n/a 100% Australia Australia n/a
LCM Operations UK Limited Body corporate n/a 100% United Kingdom Foreign United Kingdom
LCM Corporate Services UK Limited Body corporate n/a 100% United Kingdom Foreign United Kingdom
LCM Recoveries UK Limited Body corporate n/a 100% United Kingdom Foreign United Kingdom
LCM Funding UK Limited Body corporate Trustee(1) 100% United Kingdom Foreign United Kingdom
ASG Ghana Limited Body corporate n/a 100% Ghana Foreign United Kingdom
LCM Global Alternative Returns Fund LP Partnership n/a n/a Jersey Foreign n/a(2)
LCM Global Alternative Returns Feeder Fund LP Partnership n/a n/a Jersey Foreign n/a(2)
LCM Global Alternative Returns Fund GP Limited Body corporate Partner 100% Jersey Foreign Jersey
LCM Global Alternative Returns Fund (Special Partner) LP Partnership Partner n/a Jersey Foreign Jersey
LCM Global Alternative Returns Fund II LP Partnership n/a n/a Jersey Foreign n/a(2)
LCM Global Alternative Returns Feeder Fund II LP Partnership n/a n/a Jersey Foreign n/a(2)
LCM Global Alternative Returns Fund II Holding 1 LP Partnership n/a n/a Jersey Foreign n/a(2)
LCM Global Alternative Returns Fund II Holding 2 LP Partnership n/a n/a Jersey Foreign n/a(2)
LCM Global Alternative Returns Fund II GP Limited Body corporate Partner 100% Jersey Foreign Jersey
LCM Global Alternative Returns Fund II (Special Partner) LP Partnership Partner n/a Jersey Foreign Jersey
(1) A trustee relationship is established through a Nominee Agreement, where
the entity (the nominee) and the relevant Fund agree that the nominee will
hold the Fund's investment on its
behalf.
(2) Limited Partners in the Funds are tax transparent and, as a result, are
not considered tax residents of any particular jurisdiction
Directors' Declaration
In the directors' opinion:
· the attached financial statements and notes comply with the
Corporations Act 2001, Australian Accounting Standards and other mandatory
professional reporting
requirements;
· the attached financial statements and notes comply with
International Financial Reporting Standards as issued by the International
Accounting Standards Board as described in note 2 to the financial
statements;
· the attached financial statements and notes give a true and fair
view of the consolidated entity's financial position as at 30 June 2025 and of
its performance for the period ended on that date;
· there are reasonable grounds to believe that the company will be
able to pay its debts as and when they become due and payable; and
· the consolidated entity disclosure statement is true and correct.
Signed in accordance with a resolution of
directors.
On behalf of the
directors
Director
Dated this 1st day of October 2025
-end-
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