Hardy plc Annual Report & Accounts FY2023 Directors, Officers and Advisers Chairman Non-Executive Director Directors Michael Bretherton Richard Galvin Company Secretary Christopher Stobart, First Names House, Victoria Road, Douglas, Isle of Man, IM2 4DF Registrar and Registered office IQ EQ (Isle of Man) Limited, First Names House, Victoria Road, Douglas, Isle of Man, IM2 4DF Company e-mail contact and website Email: office@hardyplc.com Website: www.hardyplc.com Independent Auditor Crowe U.K. LLP, 55 Ludgate Hill, London, EC4M 7JW Transfer Agent Computershare Investor Services, (Channel Islands) Limited, Ordnance House, 31 Pier Road, St. Helier, Jersey, JE4 8PW Isle of Man Legal Advisers Cains Advocates Limited, Fort Anne, Douglas, Isle of Man, IM1 5PD Contents Directors, Officers and Advisers Chairman’s Statement Strategic Report Directors’ Report Independent Auditor’s Report Statement of Comprehensive Income Statement of Changes in Equity Statement of Financial Position Statement of Cash flows Notes to the Financial Statements Notice of AGM and explanatory notes thereto IFC 2 4 6 11 14 15 16 17 18 27 Hardy plc Annual Report and Accounts FY2023 1 Chairman’s Statement Hardy incurred a net loss of £0.83 million for the year to 31 March 2023 (FY2023) compared to a profit of £1.31 million in the previous year ended 31 March 2022 (FY2022). This FY2023 loss comprises a net unrealised investment loss of £1.30 million, together with overhead costs of £0.11 million, slightly offset by realised investment gains of £0.52 million, plus dividends received of £0.06 million. The previous FY2022 profit comprised a net investment gain of £1.20 million, together with dividends of £0.23 million, partially offset by administrative costs of £0.12 million. During FY2023, Hardy undertook a full disposal of its IDOX Plc and THG Plc investments, as well as a small partial sale of Redcentric Plc shares and which together generated total disposal proceeds to £2.60 million. Hardy spent £4.11 million on the purchase of three new short-term equity investments during FY2023, comprising Niox Group Plc, IQE plc and WANdisco Plc. The carrying value of the Company’s equity investments at 31 March 2023 was £6.88 million represented by four quoted investment holdings and one private investment. (31 March 2022: £6.14 million represented by two quoted investment holdings and one private investment). In addition, Hardy holds a derivative investment asset in the form of warrants in C4X Holdings Plc which have an exercise price that is significantly above the market price of the underlying shares and the warrants are therefore considered to have a nil fair value. The investment in WANdisco was made in January 2023 following that company’s reporting of very significant new orders received during the previous 2 months. Subsequently on 9 March 2023, WANdisco announced it had requested a suspension of its shares from trading on AIM while a legal investigation is carried out on irregularities discovered on purchase orders and related revenue bookings, which gave rise to a material misstatement of its financial position. The WANdisco shares remained suspended at 31 March 2023 and are not due to recommence trading on AIM until around 25 July 2023 when a recently announced share offer equity fundraise to raise gross proceeds of US$30 million at a price of 50 pence per share is due to complete. The offer shares will represent approximately 70.7% of WANdisco’s existing issued share capital. This investment holding is, therefore, being carried by Hardy at a 50 pence per share value at the 31 March 2023 year end, being the best indication of fair value at that date. The Company held cash and cash receivables with investment brokerage institutions amounting to £0.19 million in total at 31 March 2023, compared to cash and receivables balances of £1.77 million at the previous 31 March 2022 year end. The £1.58 million decrease reflects cash outflows of £4.11 million on investment purchases, together with outflows of £0.13 million on administrative costs and working capital, partially offset by cash inflows of £2.60 million from investment disposals and £0.06 million from dividend income receipts. Net assets decreased to £7.02 million (equivalent to 9.52p per share) at the 31 March 2023 balance sheet date, compared with £7.85 million (equivalent to 10.64p per share) at 31 March 2022. The £0.83 million decrease in net assets reflects the loss reported for the year. Business model and short-term investment portfolio Following the sale of the Company’s Hardy Exploration & Production (India) Inc. (“HEPI”) subsidiary in October 2019, Hardy effectively became a cash shell with a stated strategic intention to use its cash resources, as enlarged by the HEPI sale, for the purposes of acquiring or establishing a company, business or asset that operates in the resources sector or other industries. Such an investment opportunity has yet to present itself, however, and given the challenging economic outlook, your Directors will continue to take a very cautious approach to any commitment of the majority of the Company’s resources in to any such single long-term investment. In the meantime, the Company has deployed its resources into short-term investments with a view to earning a return for shareholders in the interim period. The short- term investments, including derivative investment assets, held by the Company at at 31 March 2023 comprised: • Redcentric Plc – is a managed service provider delivering network, cloud and collaboration solutions to public and private sector organisations; • NIOX Group Plc – is a dedicated diagnosis and management company focused on asthma. Their market-leading NIOX products are used to help improve asthma diagnosis and management; • IQE Plc – is a leading supplier of compound semiconductor wafer products and advance material solutions to the global semiconductor industry; 2 Hardy plc Annual Report and Accounts FY2023 • Telit Cinterion Ltd – is a global leader in Internet of Things (IoT) enablement, with an extensive portfolio of wireless connectivity modules, software platforms and global IoT connectivity services; • WANdisco Plc – is a data activation company which enables organisations to move large datasets to the cloud at massive scale in order to activate all their data for AI, machine learning and analytics on modern cloud data platforms; and • C4X Discovery Holdings Plc – aims to create the world’s most productive Drug Discovery engine by using cutting- edge technologies and expertise to efficiently deliver best-in-class small-molecule medicines to clinical partners. Migration of tax residence to Jersey I previously reported that following completion on 21 January 2020 of the successful takeover offer for Hardy by Jersey based Blake Holdings Limited of which I am also a Jersey based director, and my appointment as chairman of Hardy on 22 January 2020, all key management, operational and administrative functions of Hardy have subsequently been undertaken from Jersey. It was, therefore, considered appropriate that the tax residence of Hardy should be migrated from the UK to Jersey and accordingly, a notice was provided to HMRC to facilitate the migration. Determination of the precise date of defacto migration of tax residence to Jersey involved a detailed consideration of the facts and lengthy correspondence with HMRC during 2021 and 2022 but it has now been agreed that this tax migration to Jersey took place on around 22 January 2020 and that the UK tax computations to that period, which show a nil tax liability, do not require amendment. Outlook We start the current year with a global economy still being impacted by the adverse impacts of Russia’s invasion of Ukraine and rising inflation, coupled with governments heavily indebted by the financial support measures provided during the period of Covid restrictions. As a result financial conditions and monetary policy are likely to continue to tighten and with growth expected to remain weak by historical standards. The Hardy Board will, therefore, continue to maintain a rigorous and highly selective investment approach, both in terms of any long-term strategic investment and also in relation to deployment of resources in short-term quoted stocks. We remain committed to the principles of strict cost control and delivering additional value for shareholders going forward. As part of that delivering additional value for shareholders process, the Board has decided to evaluate a range of strategic options for the Company. These will include whether to continue to seek a long-term strategic investment or to transition to a pure short-term investment company and /or to return further capital to shareholders following on from the capital distribution of 12p in cash per share that was paid to all shareholders in November 2021 and which amounted to £8.85 million in total. Michael Bretherton Chairman 11 July 2023 Hardy plc Annual Report and Accounts FY2023 3 Strategic Report The Directors present their Strategic Report with the Financial Statements for Hardy plc (‘Hardy’ or ‘the Company’) for the year ended 31 March 2023. Principal activity and business model The Company has implemented a short-term strategy to deploy its cash resources into short-term investment opportunities offering the potential to deliver a favourable return to shareholders whilst a longer-term commercial opportunity is identified, in line with its stated strategic intention as set out in the Chairman’s Statement on pages 2 to 3. Business review A summary review of the Company’s performance and prospects is included in the Chairman’s Statement on pages 2 to 3 and is covered in more detail below. Financial review The Financial Statements have been prepared for the year to 31 March 2023. Key performance indicators for the Company are set out below: Net assets (£ million) Net asset value per share (pence) Capital distribution per share (pence) (Loss)/gain after tax (£ million) Cash and cash receivables with brokers (£ million) 31 March 2023 31 March 2022 7.02 9.52 – (0.83) 0.19 7.85 10.64 12.00 1.31 1.77 Profit and loss The Company’s loss after tax for the year ended 31 March 2023 was £0.83 million compared to a profit of £1.31 million in the previous year. The current year loss resulted from a total loss on short-term investments of £0.72 million together with administrative costs of £0.11 million. The prior period result includes a gain of £1.43 million on short-term investments, partially offset by administrative costs of £0.12 million. Balance Sheet Net assets of the Company at 31 March 2023 amounted to £7.02 million compared with £7.85 million at 31 March 2022. The £0.83 million reduction in net assets reflects the loss for the year. The carrying value of short-term investments at 31 March 2023 was £6.88 million represented by four quoted and one private investment holding. At 31 March 2022 short-term investments amounted to £6.14 million, represented by two quoted investment holdings and one private investment holding. Cash and short-term deposit balances, together with cash receivable balances held with brokers, amounted to £0.19 million at 31 March 2023 compared to £1.77 million at 31 March 2022 as set out in note 13 to the financial statements. Cash flow The Company’s overall cash and cash receivables position decreased by £1.58 million during the year. This decrease mainly reflects cash outflows of (£4.11) million spent on new investments, partially offset by investment disposal proceeds and dividend income received of £2.66 million, less outflows of (£0.13) million from administration costs paid net of working capital movements. Risk review Risk management The Company’s risk management objectives and exposure to various risks are detailed in note 13 to the financial statements. The main risks arising from the Company’s operations are strategic, financial and external in nature. The Directors review and agree policies for managing risk at least annually. 4 Hardy plc Annual Report and Accounts FY2023 Strategic risk No assurance can be given that an investment in a target company or business will be successful or that any investment will be made. The Directors have established an open dialogue with shareholders to ensure their support of proposed investments and provide a source to identify appropriate targets. Financial risk Market price risk – The majority of the Company’s assets are currently held in short-term UK equity investments. The Company is exposed to market price risk in respect of these short-term investments. The Company mitigates this risk by having established investment appraisal processes and asset monitoring procedures which are subject to overall review by the Board. Interest rate risk – The Company has no external financing facility; therefore, its interest rate risk is limited to the level of interest received on its cash surpluses. Interest rate risk on cash, cash equivalents and short-term deposits may be mitigated partially by using an element of fixed-rate accounts and short-term deposits. Credit risk – The Company’s principal financial assets are its short-term investments, its bank balances and cash held with a brokerage institution. The Company seeks to reduce the credit risk associated with cash by only holding cash with institutions that have good credit ratings. The credit risk associated with the Company’s short-term investments in UK companies is considered acceptable. Liquidity risk – The Company seeks to manage liquidity by ensuring enough funds are available to meet foreseeable needs and to invest cash assets safely and profitably. The Company had cash and cash receivables with brokers of £0.19 million as at 31 March 2023. In order to minimise risk to the Company’s capital, surplus funds are invested across several financial institutions with strong credit ratings. Cash forecasts are updated regularly to ensure that there is sufficient cash available for foreseeable requirements. The Directors are satisfied that the current cash and receivable balances, the liquidity of short-term investments and the relatively low running cost base of the Company, ensures that the going concern assumption remains valid. External risks Global political and economic landscapes continue to be considered the key external risks faced, with the ability of both to adversely impact the performance of the Company. The key factors comprise the full economic fallout from the Covid-19 pandemic, the current Russia-Ukraine conflict, a potential shift towards a decrease in global trade and the transition to an environment of increasing interest rates and rising inflation. Such factors continue to impact the markets in which the Company operates, in terms of investment valuations and investor sentiment. Future developments The Board has decided to evaluate a range of strategic options for the Company. These will include whether to continue to seek a long-term strategic investment or to transition to a pure short-term investment company and/or to return further capital to shareholders following on from the capital distribution of 12p in cash per share that was paid to all shareholders in November 2021, and which amounted to £8.85 million in total. Approved on behalf of the Board Richard Galvin Non-Executive Director 11 July 2023 Hardy plc Annual Report and Accounts FY2023 5 Directors’ Report The Directors of Hardy plc (‘Hardy’ or ‘the Company’) present their report, together with the audited financial statements for the year ended 31 March 2023. Principal activity Prior to the sale of the Company’s sole operating subsidiary in October 2019, Hardy had been an operator in the resource sector for over 15 years. The Company’s existing strategic intention is to use its cash and short-term investment resources for the purposes of acquiring or establishing a company, business or asset that operates in the resource sector or other industries should an appropriate investment opportunity present itself. In the interim period the Company has deployed its resources into short-term investments with a view to developing a favourable return for the benefit of shareholders. Business review and future developments A full review of the Company’s activities during the year ended 31 March 2023 is given in the Chairman’s Statement on pages 2 to 3. Results and dividend distributions The Company’s loss after tax for the year ended 31 March 2023 was £0.83 million, (FY2022: gain of £1.31 million). Share capital There were no changes in the share capital of the Company during the financial year. Full details of the Company’s share capital movements are given in Note 12 of the financial statements. Directors The Directors that served in office throughout the year ended 31 March 2023 were: Board member Michael Bretherton Richard Galvin Position Chairman Non-Executive Director Richard Galvin is engaged as a non-executive director under a letter of appointment which may be terminated on not less than three months’ notice and which sets his Director’s fee at £15,000 per annum. Michael Bretherton, is engaged as a Director under a letter of appointment which may be terminated on not less than three months’ notice and which sets his Director’s fee at £20,000 per annum. 6 Hardy plc Annual Report and Accounts FY2023 Director Profiles Michael Bretherton, Chairman Michael Bretherton was appointed as Chairman of Hardy on 22 February 2020. Michael is also Chief Executive Officer of Sarossa Plc, Chairman of Adams Plc and is a Non-executive director of E-Therapeutics Plc. He is also a Director of ORA Limited and Blake Holdings Limited. In addition, Mr Bretherton has been a Director of seven other AIM quoted companies during the last twelve years, including DeepMatter Group Plc, Nanoco Group Plc, Ceres Power Holdings Plc and Tissue Regenix Group Plc. He has a degree in Economics from Leeds University and is a member of the Institute of Chartered Accountants in England and Wales. His early career included working as an accountant and manager with PriceWaterhouse for seven years in London and Abu Dhabi. Richard Galvin, Executive Director Richard Galvin was appointed Non-Executive Director on 31 May 2020. Mr Galvin has served Hardy for over 15 years holding progressively more senior commercial and financial roles culminating with his appointment as the Company’s Executive Director in 2019. Mr Galvin was instrumental in securing the sale of the Company’s India based assets for US$8.75 million and the subsequent liquidity event for shareholders. Mr Galvin has over 20 years of commercial and corporate finance experience in the energy industry. Mr Galvin is currently a director of Yamnuska Limited, a financial and managerial service provider specialising in corporate transactions. Mr Galvin started his career at Ovintiv Inc. (formally Encana Corporation) working in progressively senior commercial roles over seven years. Mr Galvin holds a Master of Business Administration from the London Business School, a Bachelor of Commerce from the University of Calgary and was a qualified petroleum landman. Single total figure of remuneration for each Director Set out below are the emoluments of the Directors of the Company for the years indicated (£): Name of Director Richard Galvin Michael Bretherton Total Salaries/ fees Pension Benefits contribution FY2023 FY2022 FY2023 FY2022 FY2023 FY2022 15,000 15,000 20,000 20,000 35,000 35,000 6,585 6,803 – – 6,585 6,803 – – – – – – Total 21,585 21,803 20,000 20,000 41,585 41,803 Richard Galvin’s benefits included life cover, income protection, critical illness cover and medical insurance. Directors’ interests The interests of Directors in the shares of the Company as at 31 March are given below: Richard Galvin Michael Bretherton Ordinary shares of £0.01 each 31 March 2023 Ordinary shares of £0.01 each 31 March 2022 10,000 500,000 10,000 500,000 Hardy plc Annual Report and Accounts FY2023 7 Directors’ Report (continued) Capital structure and significant shareholders The Company’s authorised and issued share capital are disclosed in note 12 to the financial statements. There were no share options or other long-term incentives in place as at 31 March 2023 or 2022. At 31 March 2023 and at the date of this report, there were 73,764,035 Ordinary Shares of Hardy issued and fully paid. Major interests in share capital of the Company, of 3 per cent or more, as of 11 July 2023 were as follows: Richard Griffiths and controlled undertaking Ordinary shares of £0.01 each 11 July 2023 91.51% Corporate governance The Directors recognise the importance of sound corporate governance and where practical will seek to observe the principles of the UK Corporate Governance Code 2016 (UK Code). The Directors acknowledge, however, that whilst the Company is in its current state of transition, with no operating business and only 2 Directors, it is not possible to comply with many aspects of the UK Code. Once the Company has acquired or established a company, business or asset that operates in the resources sector or other industries, it is the intention of the Company to follow the Quoted Companies Alliance (“QCA”) Corporate Governance Code to the extent that they consider the principles appropriate for the Company’s size and nature. The Board The Board comprises currently of a Chairman and one non-executive Director. Audit committee The Audit Committee’s primary responsibilities are to monitor the integrity of the financial affairs and statements of the Company, to ensure that the financial performance of the Company and any subsidiary of the Company is properly measured and reported on, to review reports from the Company’s auditors relating to the accounting and internal controls and to make recommendations relating to the appointment of the external auditors. The Audit Committee comprises of Richard Galvin and Michael Bretherton who acts as chairman. Internal Control The Board is responsible for maintaining a sound system of internal control. The Board’s measures are designed to manage, but not eliminate, risk and such a system provides reasonable but not absolute assurance against material misstatement or loss. Some key features of the internal control system are: i) Management accounts information, budgets, forecasts and business risk issues are regularly reviewed by the Board which meets at least four times per year; ii) The Company has operational, accounting and employment policies in place; iii) The Board actively evaluates the risks inherent in the business and ensures that appropriate controls and procedures are in place to manage these risks; and iv) There is a clearly defined organisational structure and well-established financial reporting and control systems. 8 Hardy plc Annual Report and Accounts FY2023 Annual General Meeting The Company’s next Annual General Meeting (the “AGM”) will be held at Floor 1 Liberation Station, The Esplanade, St Helier, Jersey on 21 September 2023 at 11.00 a.m. A Notice of AGM setting out the business to be conducted at the meeting (the “Notice”) accompanies this Annual Report and can be found on the Company’s website www.hardyplc.com. A form of proxy for use at the meeting also accompanies this document. Shareholders not physically attending the AGM are recommended to vote using the form of proxy, in accordance with the instructions set out on the forms of proxy, so as to arrive not later than 11.00 a.m. on 19 September 2023, being 48 hours before the time of the meeting. The business of the AGM is set out in the Notice, and comprises the usual business of: • adopting the audited accounts of the Company for the year ended 31 March 2023; and • the re-appointment of Crowe U.K. LLP as auditors. The Board of Directors is satisfied that the performance of all Directors continues to be effective and is also satisfied as to their commitment to their role as Directors. Statement of Directors’ responsibilities The Directors are responsible for preparing the financial statements in accordance with applicable law and IFRS as adopted by the United Kingdom. Under such requirements, the Directors are required to prepare financial statements of Hardy plc for the year ended 31 March 2023, which comprise the Statement of Comprehensive Income, Statement of Financial Position, Statement of Cash Flows, Statement of Changes in Equity, and related notes. In preparing these financial statements, the Directors are required to: • Select suitable accounting policies and apply them consistently • Make judgements and estimates that are reasonable and prudent • State whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and • Prepare the financial statements on a going concern basis. The Directors are responsible for ensuring that proper accounting records are kept and which disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Isle of Man Companies Act 2006. The Directors are responsible for ensuring the Directors’ Report and other information included in the Annual Report are prepared in accordance with company law of the Isle of Man. In addition to the above, the Directors are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud or other irregularities. The Directors are responsible for the maintenance and integrity of the Company’s website. Legislation in the Isle of Man governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. The Directors confirm that, to the best of their knowledge: • The financial statements, which are prepared in accordance with IFRS as adopted by the United Kingdom, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and • The Annual Report and statement of accounts includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that they face. Hardy plc Annual Report and Accounts FY2023 9 Directors’ Report (continued) Internal control and risk management systems The Board has the ultimate responsibility for the Company’s internal control and risk management systems. The Audit Committee monitors internal controls and risk management systems on an annual basis. The Company has established a system of control and risk management involving an appropriate degree of oversight by senior management. Reappointment of auditor Crowe U.K. LLP have expressed their willingness to continue as auditor. In accordance with the Isle of Man Companies Act 2006, a resolution reappointing Crowe U.K. LLP as auditor of the Company will be proposed at the next Annual General Meeting. Going concern The financial information has been prepared assuming the Company will continue as a going concern. Under the going concern assumption, an entity is ordinarily viewed as continuing in business for the foreseeable future with neither the intention nor the necessity of liquidation, ceasing trading or seeking protection from creditors pursuant to laws or regulations. As at the 31 March 2023 the Company had cash and cash receivables with brokers of £0.19 million in total, together with short-term investments of £6.88 million. The Directors have reviewed the Company’s ongoing activities and having regard to the Company’s existing working capital position, the Directors are of the opinion that the Company has adequate resources to enable it to undertake its planned activities over the next 12 months from the date of these financial statements. Risk management The Company’s risk management objectives and exposure are detailed in the Strategic Report on pages 4 to 5 and in Note 13 to the financial statements. Disclosure of information to auditors So far as each Director is aware, there is no relevant audit information of which the Company’s auditors are unaware. Each Director has taken all the steps that he ought to have taken in his duty as a Director in order to make himself aware of any relevant audit information and to establish that the Company’s auditors are aware of that information. Events after 31 March 2023 On 3 July 2023 WANdisco Plc, in which Hardy has a small investment holding, announced the successful completion of a US$30 million equity fundraise using an accelerated bookbuild process of 50 pence per share and which is expected to complete on around 25 July 2023. Approved by the Board of Directors. Richard Galvin Non-Executive Director 11 July 2023 10 Hardy plc Annual Report and Accounts FY2023 Independent auditor’s report to the shareholders of Hardy plc Opinion We have audited the financial statements of Hardy plc (the ‘Company’) for the year ended 31 March 2023 which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity, the Statement of cash flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in the preparation of the financial statements is applicable law and International Accounting Standards (IAS) as adopted by the UK, and, in conformity with the requirements of the Isle of Man Companies Act 2006. In our opinion the financial statements • give a true and fair view of the state of the Company’s affairs as at 31 March 2023 and of the Company’s profit for the year then ended; • have been properly prepared in accordance with IAS as adopted by the UK; • have been properly prepared in accordance with IAS as adopted by the UK and in conformity with the requirements of the Isle of Man Companies Act 2006; • have been prepared in accordance with the requirements of the Isle of Man Companies Act 2006. Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Conclusions relating to going concern In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report. Other information The Directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Hardy plc Annual Report and Accounts FY2023 11 Independent auditor’s report to the shareholders of Hardy plc (continued) Matters on which we are required to report by exception We have nothing to report in respect of the following matters where the Isle of Man Companies Act 2006 requires us to report to you if, in our opinion: • adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or • the Company financial statements are not in agreement with the accounting records and returns; or • certain disclosures of Directors’ loans and remuneration specified by law are not made; or • we have not received all the information and explanations we require for our audit. Responsibilities of Directors As explained more fully in the directors’ responsibilities statement, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Directors are responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our audit procedures are capable of detecting irregularities, including fraud is detailed below: We obtained an understanding of the legal and regulatory frameworks within which the parent company operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. As part of our audit planning process we assessed the different areas of the financial statements, including disclosures, for the risk of material misstatement. This included considering the risk of fraud where direct enquiries were made of management and those charged with governance concerning both whether they had any knowledge of actual or suspected fraud and their assessment of the susceptibility of fraud. We considered the risk was greater in areas involving significant management estimate or judgement. Based on this assessment we designed audit procedures to focus on the key areas of estimate or judgement, this included specific testing of journal transactions, both at the year end and throughout the year. Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations. These inherent limitations are particularly significant in the case of misstatement resulting from fraud as this may involve sophisticated schemes designed to avoid detection, including deliberate failure to record transactions, collusion or the provision of intentional misrepresentations. 12 Hardy plc Annual Report and Accounts FY2023 A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditor’s report. Use of our report This report is made solely to the Company’s members, as a body, in accordance with Section 80(c) of the Isle of Man Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions we have formed. Leo Malkin For and on behalf of Crowe U.K. LLP Chartered Accountants London 11 July 2023 Hardy plc Annual Report and Accounts FY2023 13 Statement of Comprehensive Income For the year ended 31 March 2023 Revenue Administrative expenses Operating loss Financial and investment return (Loss)/profit before taxation Taxation (Loss)/profit after taxation (Loss)/profit per share Basic & diluted Year ending 31 March 2023 £’000 Year ending 31 March 2022 £’000 Notes – (111) (111) (714) (825) – (825) – (115) (115) 1,426 1,311 – 1,311 (1.12)p 1.78p 8 5 6 All activities are in respect of continuing operations and there are no other items of comprehensive income. 14 Hardy plc Annual Report and Accounts FY2023 Statement of Changes in Equity For the year ended 31 March 2023 At 31 March 2021 Redenomination of share capital Cancellation of share premium account Cancellation of foreign exchange reserve Capital distribution Total comprehensive gain for the year At 31 March 2022 Total comprehensive loss for the year At 31 March 2023 Share capital £’000 415 323 – – – – 738 – 738 Share premium £’000 68,249 (323) (67,926) – – – – – – Foreign Currency Translation Reserve £’000 24,204 – – (24,204) – – – – – Retained earnings £’000 (77,476) – 67,926 24,204 (8,852) 1,311 7,113 (825) 6,288 Total £’000 15,392 – – – (8,852) 1,311 7,851 (825) 7,026 Hardy plc Annual Report and Accounts FY2023 15 Statement of Financial Position As at 31 March 2023 Current assets Trade and other receivables Short-term investments Cash and cash equivalents Total current assets Total assets Liabilities Trade and other payables Total liabilities Net assets Shareholders’ Equity Called-up share capital Retained earnings Total equity Notes 31 March 2023 £’000 31 March 2022 £’000 9 10 13 11 12 90 6,884 101 7,075 7,075 (49) (49) 7,026 738 6,288 7,026 1,680 6,142 95 7,917 7,917 (66) (66) 7,851 738 7,113 7,851 Approved and authorised for issue by the Board of Directors on 11 July 2023. 16 Hardy plc Annual Report and Accounts FY2023 Statement of Cash Flows For the year ended 31 March 2023 Operating activities Operating loss Decrease/(increase) in trade and other receivables (Decrease)/increase in trade and other payables Net cash generated from/(used in) operating activities Investing activities Purchase of short-term equity investments Proceeds from disposal of short-term investments Net cash (used in)/from investing activities Financing activities Dividend income Capital distribution Net cash from/(used in) financing activities Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year Year ending 31 March 2023 £’000 Year ending 31 March 2022 £’000 Notes (111) 1,590 (17) 1,462 (4,115) 2,600 (1,515) 59 – 59 6 95 101 (115) (1,656) 16 (1,755) – 10,393 10,393 233 (8,852) (8,619) 19 76 95 8 Hardy plc Annual Report and Accounts FY2023 17 1 Accounting Policies The following accounting policies have been applied in the preparation of the financial statements of Hardy plc (“Hardy” or the “Company”). The domicile, country of incorporation, address of the registered office and a description of the Company’s principal activities can be found in the Directors’ Report. These Company financial statements are for the year ending 31 March 2023 (FY2023) together with prior year Company comparatives. a) Basis of measurement Hardy prepares its financial statements on a historical cost basis except as otherwise stated. b) Going Concern The financial information has been prepared assuming the Company will continue as a going concern. Under the going concern assumption, an entity is ordinarily viewed as continuing in business for the foreseeable future with neither the intention nor the necessity of liquidation, ceasing trading or seeking protection from creditors pursuant to laws or regulations. As at the 31 March 2023 the Company had cash and short-term investments and cash receivable with brokers totalling £6.33 million. The Directors have reviewed the Company’s ongoing activities and having regard to the Company’s existing working capital position, the Directors are of the opinion that the Company has adequate resources to enable it to undertake its planned activities over the next 12 months from the date of these financial statements. c) Basis of Preparation Hardy prepares its financial statements in accordance with applicable International Financial Reporting Standards as adopted by the UK (IFRS). The financial statements are presented in GBP pounds sterling rounded to the nearest thousand. d) Changes in accounting policies and disclosures The accounting policies adopted are consistent with those of the previous financial year. New standards and amendments to IFRS effective as for the financial reporting period have been reviewed by the Company and there has been no material impact on the financial statements as a result of these standards and amendments. Standards issued but not yet effective New Accounting Standards, interpretations and amendment adopted. The following were new standards and amendments to existing standards which are relevant to the Company and are effective for annual periods commencing on or after 1 April 2022: • Updates to IFRS9 “Financial Instruments” • Interest Rate Benchmark Reform (Amendments to IFRS9, IAS39, IFRS7, IFRS4 and IFRS16) • Reference to the Conceptual Framework (Amendment to IFRS3) • Classification of Liabilities of Current or Non-current (Amendments to IAS1) • Definition of Accounting Estimates (Amendments to IAS8) Adoption of these new and amended standards has had no material impact on the financial statements of the Company. Accounting Standards or interpretations, not yet early adopted A number of new standards, amendments to existing standards and interpretations which have been issued or amended by IASB, are not yet effective and have not been applied in preparing these financial statements. The Directors are considering the standards, however, at this time they are not expected to have a significant impact on the Company. 18 Hardy plc Annual Report and Accounts FY2023 Notes to the Financial StatementsFor the year ended 31 March 2023 e) Presentational reporting currency The functional and presentational currency of the Company continues to be that of the primary economic environment in which the Company operates which is £GBP. This is the currency in which expenses are incurred, salaries are paid, income is received, and equity funds are raised. f) Revenue and other income Revenue and other income is measured at the fair value of the consideration received or receivable in the normal course of business, net of discounts and other sales related taxes. The Company recognises income when the amount of income can be reliably measured and when it is probable that the future economic benefits will flow into the Company. i) Investment return (other income) Investment return represents the sum of realised gains and losses on the disposal of short-term investment portfolio assets and derivative financial instruments and the unrealised gains and losses on the revaluation of these, together with any related investment income received and receivable. Realised gains and losses on the disposal of investments is the difference between the fair value of the consideration received less any directly attributable costs on the sale and the fair value of the investments at the start of the accounting period or acquisition date if later. Unrealised gains and losses on the revaluation of investments is the movement in carrying value of investments between the start of the accounting period or acquisition date if later and the end of the accounting period. Dividends from investments are recognised when the Company’s right to receive payment has been established. ii) Interest income Interest income is recognised as interest accrues using the effective interest rate method. g) Short-term investments Short-term investments include investment assets which are designated at fair value through profit or loss on initial recognition. This is considered most appropriate as these investment assets are assessed and evaluated on a fair value basis. i) Quoted investments for which an active market exists are valued at closing bid-market price at the reporting date with any gains or losses arising from subsequent changes in fair value being presented in the Statement of Comprehensive Income as they arise. i) Unquoted investments are measured at fair value by the Directors as follows: – Investments in companies that are still in a development phase continue to be valued based on cost unless there have been more recent benchmark subscriptions and investments which give a guide to fair value (“Price of Recent Investment”) or where there are factors that indicate a change in fair value has occurred. – Once the business becomes established, investments are valued based on an estimate of the fair value for the investee company derived using methodologies which include applying an average sector earnings multiple to operating profits, valuation by reference to net asset base and discounted cash flows. Short-term investments also include derivative trading assets, which are valued at the trade date, being the date at which the Company becomes party to the contractual provisions of the instrument. The Company only trades in derivative financial instruments that are quoted in active markets with the related financial assets or liabilities being stated at fair value with any change in fair value being recognised through profit or loss. The Company currently only holds share warrants with an exercise price which is significantly above the market price of the underlying shares and are therefore considered to have no current fair value. Hardy plc Annual Report and Accounts FY2023 19 Notes to the Financial StatementsFor the year ended 31 March 2023 h) Taxation The tax expense represents the sum of current tax and deferred tax. Current tax is based on the taxable profit of the year. Taxable profit differs from net profit as reported in the Statement of Comprehensive Income as it excludes certain items of income or expenses that are taxable or deductible in years other than the current year and it further excludes items that are never taxable or deductible. The current tax liability is calculated using the tax rates that have been enacted or substantially enacted by the year end date. Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the liability method. Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available in the future against which deductible temporary differences can be utilised. Deferred tax assets and liabilities are measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which temporary differences reverse, based on tax rates and laws enacted at the year-end date. i) Foreign currencies Foreign currency transactions are accounted for at the exchange rate prevailing on the date of the transaction. At the year-end date, all foreign currency monetary assets and monetary liabilities are restated at the closing exchange rate. Exchange differences arising from transactions during the year and from the year end translation are reflected through the income statement. The Company held no foreign currency monetary assets or liabilities of significance at 31 March 2023 or 31 March 2022. 2 Critical accounting estimates and judgements The preparation of the Company’s financial statements requires the use of estimates and judgements that affect the carrying value of assets and liabilities at the reporting date and the reported amounts of revenue and expenditure for the year. These estimates and judgements are made based on management’s knowledge of the facts, taking into account historical experiences and expectations of future events that are believed to be reasonable under the particular circumstances. By definition the actual results will most likely differ from the estimates made. The estimate and assumption that has the most significant effect on the carrying amounts of assets and liabilities in the financial statements is the valuation of quoted and unquoted short-term investments. These are valued as set out in note 1(g) to the financial statements and in accordance with IFRS. However, it may not always be possible to trade at the carrying amount valuations of such quoted and unquoted short-term investments. In addition, the Company’s quoted investment in WANdisco Plc was suspended from the AIM market as at 31 March 2023 while a legal investigation is carried out on irregularities discovered on purchase orders and related revenue bookings, which gave rise to a material misstatement of its financial position. The WANdisco shares are not due to recommence trading on AIM until around 25 July 2023 when a recently announced share offer equity fundraise to raise gross proceeds of US$30 million at a price of 50 pence per share is due to complete. The offer shares will represent approximately 70.7% of WANdisco’s existing issued share capital at the 31 March 2023 year end date. This investment holding is, therefore, being carried by Hardy at a 50 pence per share value at the 31 March 2023 year end, being the best indication of fair value at that date and which amounts to a WANdisco investment holding value of £32,000. As at 31 March 2023, quoted short-term investments are carried in the financial statements at a valuation of £4.06 million and unquoted short-term investments are carried at a valuation of £2.82 million – see note 10 to the financial statements. 3 Segmental Reporting The Company operates in a single geographical segment. There are currently no reportable segments of the Company. 20 Hardy plc Annual Report and Accounts FY2023 Notes to the Financial StatementsFor the year ended 31 March 2023 4 Staff costs Wages and salaries Social security costs 2023 £’000 35 7 42 2022 £’000 34 8 42 Staff costs include executive Directors’ salaries and fees, life and medical insurance benefits and any pension contributions. The Company had no pension commitments at the year-end date. The weighted average monthly number of employees, including executive Directors and individuals employed by the Company, were as follows: Management and administration 5 Taxation Analysis of taxation charge for the year Current tax charge Jersey corporation tax Current tax charge Deferred tax Total taxation charge Factors affecting tax charge for the year (Loss)/profit before tax Jersey domiciled Total tax on (loss)/profit at the appropriate rate of tax Jersey domiciled (FY2023: nil, FY2022: nil) 2023 2.0 2023 £’000 – – – – 2023 £ (825) (825) – 2022 2.0 2022 £’000 – – – – 2022 £ 1,311 1,311 – Hardy is an Isle of Man incorporated company which, prior to the sale of the Company’s HEPI subsidiary in October 2019 and the subsequent change of control and board restructure in January 2020, was managed and controlled in the UK. The change in control arose on completion of a successful takeover offer by Jersey based Blake Holdings Limited and following which one of its Jersey based directors, Michael Bretherton, was appointed chairman of Hardy. Since that time all management, operational and administrative functions of Hardy have been undertaken from Jersey. It was, therefore, considered appropriate that the tax residence of Hardy should be migrated from the UK to Jersey and accordingly a notice of migration was provided to HMRC. Based on a consideration of the facts and correspondence with HMRC, it was determined in 2022 that a defacto migration of tax residence to Jersey took place on around 22 January 2020, and this position has been agreed by HMRC and registered with the Jersey tax authorities. All carry forward UK tax losses were forfeited on the tax migration from the UK to Jersey and, therefore, no deferred tax asset has been recognised in respect of these. Hardy plc Annual Report and Accounts FY2023 21 Notes to the Financial StatementsFor the year ended 31 March 2023 2022 £’000 1,311 73,764 1.78 2022 £’00 (4,027) (485) 5,705 233 1,426 2023 £’000 (1,294) – 521 59 (714) At 31 March 2023 £’000 At 31 March 2022 £’000 84 6 90 1,674 6 1,680 6 Earnings per share Basic earnings per share is calculated on a weighted average of 73,764,035 Ordinary Shares in issue for the year ended 31 March 2023 (FY2022: 73,764,035) to give a loss of (1.12p) per share for FY2023 (FY2022: gain of 1.78p per share). Diluted earnings per share is calculated by adjusting the weighted average number of Ordinary Shares in issue during the year to assume conversion of all dilutive potential ordinary shares. There were no dilutive potential Ordinary Shares in issue at 31 March 2023 (2022: nil). (Loss)/earnings per Ordinary Share (Loss)/profit for the year Weighted average number of shares Basic and diluted (loss)/earnings per Ordinary Share (pence) 2023 £’000 (825) 73,764 (1.12) 7 Audit fees Audit fees payable to the Company’s auditors for the audit of the financial statements for the year ended 31 March 2023 is £18,500 (2022: £17,500). 8 Financial and investment return Unrealised losses on the revaluation of investments Unrealised losses on the revaluation of share warrants Realised gains on the disposal of short-term investments Dividend income 9 Trade and other receivables Other receivables Prepaid expenses Other receivables comprise cash held on demand with a reputable international brokerage firm pending investment. 22 Hardy plc Annual Report and Accounts FY2023 Notes to the Financial StatementsFor the year ended 31 March 2023 10 Short-term investments Equity Investments – quoted Equity investments – unquoted Derivative trading asset – quoted At 31 March 2023 £’000 At 31 March 2022 £’000 4,061 2,823 – 6,884 3,319 2,823 – 6,142 It is considered that the above investments in quoted equity investments can be converted into cash at short notice. The unquoted equity investment reflects a transfer from quoted equity investments on 31 August 2021 when the acquisition of Telit Communications Plc was completed by a private company in which Hardy received unquoted shares in consideration for its quoted holding in Telit. The derivative trading asset reflects share warrants held in a listed company. The share warrants are able to be exercised at any time during a 5 year period from 12 May 2021. At the 31 March 2023 and 31 March 2022 balance sheet dates the warrants were out-of-the-money with an exercise price which was significantly above the market price of the underlying shares and hence were considered to have no value. 11 Trade and other payables Trade and other payables Accruals 12 Share capital Authorised Ordinary Shares At 31 March 2022 At 31 March 2023 Allotted, issued and fully paid Ordinary Shares At 31 March 2022 At 31 March 2023 At 31 March 2023 £’000 At 31 March 2022 £’000 8 41 49 Number of Ordinary Shares 200,000,000 200,000,000 73,764,035 73,764,035 26 40 66 Nominal Value £’000 2,000 2,000 738 738 The Ordinary Shares in issue have a par value of £0.01 per share and have equal voting and other rights with no guarantee to dividend or other payments. Hardy plc Annual Report and Accounts FY2023 23 Notes to the Financial StatementsFor the year ended 31 March 2023 13 Financial risk management Hardy finances its operations through a mixture of equity and retained earnings. Finance requirements are continually reviewed by the Board in relation to the context of continuing operations and strategic plans. Hardy’s objective is to maintain a strong financial position to sustain future development of the business. The Company expanded its capital management approach in a prior financial year to allow for the short-term investment in UK equities. Hardy’s treasury functions are responsible for managing fund requirements and investments which include banking, cash flow management and interest and foreign exchange exposure to ensure adequate liquidity to meet cash requirements. Hardy’s principal financial instruments are cash, deposits, short-term investments, receivables and payables. Hardy’s main financial risks are considered to be liquidity and credit risk. Set out below are policies that are used to manage such risks: Liquidity risk The Company currently has cash which has been placed in deposits and short-term equity investments which can be converted into cash at short notice, ensuring sufficient liquidity to meet the Company’s expenditure requirements. Credit risk Deposits and other money market instruments, as a general rule, are placed with banks and financial institutions that have an investment grade rating, which is verified before placing the deposits. Cash surpluses may also be invested in short-term investments in certain liquid funds and securities and may also be held with reputable international brokerages pending investment. Cash on demand – rated AA Other cash receivables – no rating provided* Total cash and cash receivables At 31 March 2023 £’000 At 31 March 2022 £’000 101 84 185 95 1,674 1,769 * These monies are held on demand with a reputable international brokerage for which no credit rating is available, note 9. The Board will continue to assess the strategies for managing credit risk and is satisfied with the existing policies. The maximum financial risk exposure relating to the financial assets is the carrying value of such financial assets as at the year-end date. Foreign currency risk The Company has no material transactions denominated in foreign currencies and the majority of the Company’s assets and liabilities as at 31 March 2023 were denominated in Pounds Sterling (£). Capital Management The Company monitors the long-term cash flow requirements of the business in order to assess the requirement for changes to the capital structure to meet that objective and to maintain flexibility. The Company considers its capital to consist of issued share capital only. The Board manages the structure of its capital and makes necessary adjustments to accommodate the changes in the economic conditions. To maintain or adjust the capital structure, the Board may issue new shares for cash. No significant changes were made in the objectives, policies or processes during the year ended 31 March 2023. 24 Hardy plc Annual Report and Accounts FY2023 Notes to the Financial StatementsFor the year ended 31 March 2023 13 Financial risk management – continued Interest rate risk profile of financial assets The interest rate risk profile of the financial assets of the Company as at 31 March is as follows: Cash and cash equivalents Trade and other receivables Short-term investments At 31 March 2023 Cash and cash equivalents Trade and other receivables Short-term investments At 31 March 2022 Fixed rate financial assets £’000 Financial assets where no interest is earned £’000 101 84 – 185 95 1,674 – 1,769 – – 6,884 6,884 – – 6,142 6,142 Total £’000 101 84 6,884 7,069 95 1,674 6,142 7,911 Financial assets include cash deposits and receivables, equity investments and derivative trading assets. Currency exposures The currency exposures of the monetary assets denominated in currencies other than £ were as follows: $USD At 31 March 2023 £’000 At 31 March 2022 £’000 – 1 The foreign exchange gain or loss recognised through the income statement for the years ended 31 March 2023 and 31 March 2022 in respect of the above exposures was negligible. 14 Financial instruments Book values and fair values of the Company’s financial assets and liabilities are as follows: Financial assets Primary financial instruments Short-term investments Derivative trading assets Cash and cash equivalents Trade and other receivables Trade and other payables Book value 2023 £’000 Fair value 2023 £’000 Book value 2022 £’000 Fair value 2022 £’000 6,884 – 101 84 (49) 7,020 6,884 – 101 84 (49) 7,020 6,142 – 95 1,674 (66) 7,845 6,142 – 95 1,674 (66) 7,845 All the above financial assets are current and unimpaired as at 31 March 2023. All the financial liabilities are current as at 31 March 2023. Hardy plc Annual Report and Accounts FY2023 25 Notes to the Financial StatementsFor the year ended 31 March 2023 15 Related party transactions Related party transactions with Directors and the key management personnel of the Company, comprise only remuneration payments. The aggregate remuneration for these is as follows: Short-term employee benefits 2023 £’000 42 2022 £’000 42 Key management personnel include the Directors of the Company. Further information about the remuneration of individual Directors is provided on page 7 of the Directors’ Report. There were no sales made to related parties. Purchases from related parties are made at normal market prices and when balances are outstanding at the period end, these are unsecured, interest free and settlement occurs in cash. During the year to 31 March 2023, accounting and administration fees have been charged through the Statement of Comprehensive Income in respect of £15,000 (FY2022: £15,000) charged by Sarossa Plc, which is a controlled undertaking of Richard Griffiths and of which Michael Bretherton is also a director. No amounts were outstanding at the year end (FY2022: £nil). 16 Post 31 March 2023 event highlights On 3 July 2023 WANdisco Plc, in which Hardy has a small investment holding, announced the successful completion of a US$30 million equity fundraise using an accelerated bookbuild process at a price of 50 pence per share and which is expected to complete on around 25 July 2023. 26 Hardy plc Annual Report and Accounts FY2023 Notes to the Financial StatementsFor the year ended 31 March 2023 NOTICE IS HEREBY GIVEN that the 2023 ANNUAL GENERAL MEETING of the Company will be held at Floor 1 Liberation Station, The Esplanade, St Helier, Jersey on 21 September 2023. Shareholders are welcome to physically attend the AGM. Shareholders wishing to vote by proxy should do so in accordance with the instructions below. All completed Forms of Proxy must arrive not later than 11.00 a.m. on 19 September 2023, being 48 hours before the time of the meeting. When completing your proxy forms, your attention is drawn to the notes to the forms of proxy. A. At the Annual General Meeting, the following ordinary business will be transacted: The consideration and, if thought fit, passing of the following resolutions which will be proposed as ordinary resolutions: 1. THAT the audited accounts of the Company for the year ended 31 March 2023 and the reports of the Directors and the Auditors and any other document required to be annexed thereto be and they are hereby considered and adopted. 2. THAT Crowe U.K. LLP, London, United Kingdom be and they are hereby re-appointed as Auditors to the Company and that the Directors be and they are hereby authorised to determine their remuneration. No special business of the Company is to be proposed. Registered office: First Names House Victoria Road Douglas Isle of Man, IM2 4DF Dated 11 July 2023 By Order of the Board Christopher Stobart Company Secretary Notes on entitlement to attend and vote at the Annual General Meeting: 1. A Form of Proxy is enclosed which, to be valid, must be completed and delivered, sent by post to First Names House, Victoria Road, Douglas, Isle of Man, IM2 4DF or sent by facsimile to +44 (0)1624 624469 or scanned and e-mailed to Maxine.Cleverley@iqeq.com, and cc Katie.Parton@iqeq.com, together with the power of attorney or other authority (if any) under which it is signed (or a certified copy of such authority). All Forms of Proxy and any power of attorney of other authority must arrive not later than 11 a.m. on 19 September 2023, being 48 hours before the time of the meeting. 2. The Company, pursuant to Regulation 22 of the Uncertificated Securities Regulations 2006 (Isle of Man), specifies that only those members registered in the register of members as at 11.00 a.m. on 19 September 2023 (or in the event that the meeting is adjourned, on the register of members 48 hours before the time of any adjournment meeting) shall be entitled to vote in respect of the Ordinary Shares registered in their name at that time. Changes to entries on the register of members after 11.00 a.m. on 19 September 2023 (or, in the event that the meeting is adjourned, on the register of members less than 48 hours before the time of any adjourned meeting) shall be disregarded in determining the rights of any person to vote at the meeting. Hardy plc Annual Report and Accounts FY2023 27 Notice of Annual General Meeting(Incorporated under the Companies Act 2006 of the Isle of Man and registered in the Isle of Man with registered number 018168V) Notes 28 Hardy plc Annual Report and Accounts FY2023