Annual
Report &
Accounts
Year ended 31 December 2023
Contents
Strategic Report
Company information
Year at a glance
The Group at a glance
Chair’s statement
Chief Executive Officer’s statement
Strategic report
Principal risks and uncertainties
Corporate Social Responsibility
Equality, Diversity, and Inclusion
Corporate Governance
Board of Directors
Corporate Governance statement
Directors’ report
Financial Statements
Independent auditor’s report to the
members of RBG Holdings plc
Consolidated statement of comprehensive income
Consolidated statement of financial position
Consolidated statement of cash flows
Consolidated statement of changes in equity
Company statement of financial position
Company statement of cash flows
Company statement of changes in equity
Notes to the Consolidated and Company
financial statements
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6
8
10
14
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Strategic
Report
Contents
Strategic Report
Company information
Year at a glance
The Group at a glance
Chair’s statement
Chief Executive Officer’s statement
Strategic report
Principal risks and uncertainties
Corporate Social Responsibility
Equality, Diversity, and Inclusion
4
6
8
10
14
18
4
Company information
SEDOL Symbol: AIM: RBGP
Websites
www.rbgholdings.co.uk
www.rosenblatt-law.co.uk
www.memerycrystal.com
5
Directors
Marianne Ismail
Non-Executive Chair
Patsy Baker
Non-Executive Director
David Wilkinson
Non-Executive Director
N Foulston
(terminated 31 January 2023)
Suzanne Drakeford-Lewis
Group Finance Director
(resigned 30 June 2023)
Keith Hamill OBE
Non-Executive Chairman
(resigned 22 June 2023)
Jon Divers
Chief Executive Officer (appointed 3 March 2023)
Kevin McNair
Chief Financial Officer (appointed 28 November 2023)
Ian Rosenblatt OBE
Executive Vice Chair (appointed 27 July 2023, resigned 28 March 2024)
Tania MacLeod
Director (appointed 3 March 2023)
Nick Davis
Director (appointed 3 March 2023)
Secretary and registered office
J Lovitt (appointed 27 March 2023)
165 Fleet Street, London, EC4A 2DY
Company number
11189598
Country of incorporation of parent company
United Kingdom
Auditor
Moore Kingston Smith LLP
6th Floor, 9 Appold Street, London, EC2A 2AP
Principal bankers
HSBC UK Bank plc
60 Queen Victoria Street, London, EC4N 4TR
Lloyds Bank
25 Gresham Street, London, EC2V 7HN
Nominated advisers and brokers
Singer Capital Markets
1 Bartholomew Lane, London, EC2N 2AX
Registrars
Computershare
The Pavilions, Bridgwater Road,
Bristol, BS13 8AE
Financial communications consultants
SEC Newgate
14 Greville Street, London, EC1N 8SB
Strategic Report 6
Year at a
glance
Highlights1
Revenue
£39.2m 12.6%
2022: £44.9m
excluding proceeds on
disposal of damages
based assets
Revenue (including discontinued operations)
£41.4m 13.4%
62.5%
54.3%
Adjusted2 EBITDA
Adjusted EBITDA (including discontinued operations)
Adjusted2 loss before tax
Non-recurring costs
Loss before tax
Loss from continuing operations
Loss on discontinued operations (including goodwill
impairment), net of tax
Loss for the year (including discontinued operations)
Free cashflow outflow
Net debt
RBG Legal Services fee earner utilisation
RBG Legal Services fee earner realisation
£4.6m
£4.0m
£0.7m
£10.6m
£11.4m
£11.0m
£12.9m
£23.9m
£3.1m
£22.9m
70%
87%
2022:
£47.9m
2022:
£12.4m
2022:
£8.7m
2022:
£7.6m
2022:
£9.7m
2022:
£2.1m
2022:
£1.6m
2022:
loss £3.1m
2022: inflow
£4.7m
2022:
£4.0m
2022:
£19.2m
2022:
76%
2022:
90%
1
2
All measures apart from net debt and including prior year comparatives are shown on a continuing operations basis unless otherwise stated (Convex Capital and LionFish
Litigation Finance are treated as discontinued operations).
The Group presents adjusted EBITDA and loss before tax as an operating KPI, they are adjusted for one off costs that are considered to be exceptional, refer to Note 1 for
further information.
Strategic
highlights:
New appointments of:
- Jon Divers, Chief Executive Officer
- Kevin McNair, Chief Financial Officer
Disposal of LionFish, the Group’s litigation
finance operation
Renewing the Group’s banking facilities totalling
£24.0m on terms deemed favourable by the Board
Implementation of a new Enterprise Resource
Planning ‘ERP’ management information system
Scaling back from unfunded Damages
Based Agreements
A full comprehensive review of all aspects of
the accounting treatment of work in progress
and debtors
We recognise that 2023 was a
challenging year for the Group.
However, the significant progress
in realigning the business gives the
Board confidence that the Group
is on a much stronger footing than
it has been for some time. The new
Executive team, led by CEO Jon Divers,
has made difficult decisions to reduce
the Group’s risk profile, its cost base,
and to refocus RBG on its core legal
activities, like the business that floated
in 2018, where the Board believes
profits will be maximised.
Marianne Ismail, Chair, RBG Holdings plc
7
Events after
reporting date:
• On 22 February 2024, the Group raised £0.9 million
before expenses through the issue of new ordinary
shares. A further £2.1 million before expenses was
raised through the issue of new ordinary shares on
12 March 2024. The fundraising, which took place
at a tight discount to the prevailing share price,
was strongly supported by existing institutional
shareholders, including certain directors who
subscribed for £1.0 million of shares as part of the
fundraise. The purpose of the raise was to provide
additional working capital to the Group and to reduce
the use of the Group’s banking facilities.
• On 28 March 2024, the Group completed
the disposal of Convex Capital to a joint
venture led by its management team for an
initial consideration of £2.0 million, with up to
£600,000 of contingent consideration payable on
completion of certain subsequent transactions.
Following the disposal, the Group is focused
purely on legal services, its core business.
• Following the completion of the disposal of Convex
Capital, Ian Rosenblatt stepped down from the Board.
Ian remains the Group’s largest shareholder and
largest generator of revenue.
Outlook:
• Trading during the first quarter of 2024 has been in
line with expectations. Ignoring the impact of the
unusually large piece of work that ran during mid and
late 2022 into January 2023, Legal Services has traded
slightly ahead in Q1 2024 compared to Q1 2023 on a
like for like basis;
• Management is focused on specific areas of
legal services which they believe offer the best
opportunities for organic growth. Some of these
are existing practices within the Group, others are
complementary where the Group has recently
recruited new partners and is looking to add
additional resource;
• The seven new partners that have joined in the
past nine months have made an encouraging
start. They are closely aligned to the areas which
management believe offer the best growth and
margin opportunities;
• There is, and there always will be, a heavy focus on
cost reduction wherever possible across the Group
although management are conscious of the need to
maintain scalability within the support functions of
the business; and
• The Board is optimistic that 2023 marked the end of
the pivot from the Group’s previous strategy and that
there are opportunities for the Group to grow.
Strategic Report
8
9
The Group at a glance
Our purpose
Sustainability
While the nature of the business means the Group does not
have a significant environmental impact, the Board believes
that good environmental practices, such as the recycling of
paper waste and conservation of energy usage, will support
its strategy by enhancing the reputation of the Group.
Recent examples of this include:
• Our Fleet Street address has 100% renewable
power supply; and
• Our Fleet Street address’s waste is 100% recycled
or waste to energy (no landfill)
The Group
Following restructuring activity in 20233 and at the beginning
of 2024 , RBG Holdings plc is a legal services group. Through
our leading law firm brands, Rosenblatt and Memery Crystal,
the Group offers clients the full spectrum of legal services
including employment, corporate transactions, IP, and
dispute resolution.
Rosenblatt is one of the UK’s pioneering legal practices and
a leader in dispute resolution (litigation). Rosenblatt provides
a range of legal services to its diversified client base, which
includes companies, banks, entrepreneurs, and individuals.
Complementing this is Rosenblatt’s increasingly international
footprint, advising on complex cross-jurisdictional disputes.
Rosenblatt was ranked in Tier 1 in The Legal 500 (Legalease)
in 2024 for commercial litigation: mid-market.
Memery Crystal is a specialist in non-contentious, corporate
legal services. Its specialist areas include corporate (including
a market-leading corporate finance offering), real estate,
commercial, IP & technology (CIPT), banking & finance, tax
& wealth structuring, and employment law. Memery Crystal
is one of the leading legal practices in the UK to advise the
emerging cannabis sector on a wide range of business issues.
Memery Crystal offers a partner-led service to a broad range
of clients, from multinational companies, financial institutions,
and owner-managed businesses to entrepreneurs.
Memery Crystal was ranked in 12 categories in The Legal 500
(Legalease) directory in 2024.
The Group aims to concentrate on developing a leading
legal services business that will create long-term value to
its shareholders, by delivering successful outcomes for
its clients, and is a responsible employer that supports its
employees and has a positive impact in the communities
in which it operates.
Charity of the Year
The group raised a total of £35,807 for chosen charity KEEN
London through various fundraising activities such as bake
sales, raffles, walks and sporting events. KEEN addresses the
lack of support for young people with additional needs to
access meaningful employment or volunteering opportunities
and gain valuable transferable skills. The money raised paid
for 350 hours’ worth of sessions with over 100 children, plus
rent payment for a year and much more.
Equality, diversity and inclusion
The Group is immensely proud of the work completed by its’
various staff-led equality, diversity, and inclusion networks in
2023. This included:
• an International Women’s Day event on the topic of
miscarriage, baby loss and fertility treatment organised
by the Gender Parity network.
• a talk by alcohol awareness charity, Alcohol Change UK
to mark World Mental Health Day
• a talk by Sara Gibbs, a comedy writer and autistic
advocate, who talked through a number of workplace
neurodiversity tips organised by the Disability and
Neurodiversity network
• a Pride entertainment night with a performance by
London drag queen and host Kara Couture organised by
the LGBTQ+ network
• a talk from alumni of the MBA 30 initiative and founder of
Black British Initiative, a presentation from co-founder of
the first contemporary African photography gallery, and
a black street art tour in Shoreditch to celebrate Black
History Month
Company culture
The Group has endeavoured to improve internal
communications this year, introducing some new initiatives to
encourage transparency on operations, but also to educate
staff. In a post pandemic world where hybrid working is
very much the norm, communication and culture can suffer,
as such monthly town hall group-wide calls have been
introduced on top of the existing quarterly updates, with
guest speakers from within the group each month.
3 The Group completed the disposal of Convex Capital on 28 March 2024.
Our Strategy
The Board’s strategy is to build a high margin, cash-generative,
legal services Group with diversified revenue and profit streams
to deliver organic growth and sustained shareholder value.
Whilst the prevailing economic environment has been
challenging, we see considerable opportunity in the three
main practice areas of the Group (Dispute Resolution,
Corporate and Real Estate), as the economic outlook
improves, and operational improvements take hold. These
improvements include the recruitment of seven new partners
in 2023, the implementation of a new ERP management
information system to enhance workflow across the different
practices and focusing on improving the performance of
all fee earners through providing more timely and robust
key performance indicators (KPIs) pertaining to fee earner
performance, such as utilisation rates, recovery rates, and fee
cost ratios.
Dividend Policy
The Group’s priority is to reduce its debt and as a result in
July 2023 suspended its dividend policy for the foreseeable
future. The Board recognises the importance of dividends
to shareholders and will seek to reinstate its dividend policy
once it has made headway in reducing the Group’s debt to a
more prudent level.
Discontinued Operations
LionFish Litigation Finance
LionFish was a start-up founded in 2019 by the previous
management as a unique, alternative provider to the
traditional litigation funders. It finances litigation matters
being run by other solicitors in return for a significant
return on the outcome of those cases. In July 2023, the
Group completed the disposal of the non-core business,
LionFish to Blackmead Infrastructure Limited (“Blackmead”)
which reduced the Group’s exposure to litigation funding
commitments.
Convex Capital
Convex is a specialist sell-side corporate finance boutique
based in Manchester. Convex Capital is entirely focused
on helping companies, particularly owner-managed and
entrepreneurial businesses, realise their value through sales
to large corporates. Convex Capital identifies and proactively
targets firms that it believes represent attractive acquisition
opportunities. Following a strategic review of the business
in 2023, the Board made the decision to dispose of Convex
Capital, this is in line with the Group’s strategy to reduce its
risk profile and to refocus the Company on its established
legal services businesses – Rosenblatt and Memery Crystal.
On 28 March 2024, the Group announced that it had
completed the disposal of Convex.
Investment Case
RBG Holdings plc is a leading legal services group with
a diversified revenue base, and commercially driven
management team. In 2023, a new management team
took on the leadership of the business. This new team have
undertaken a thorough review of the Group’s operations and
set about reducing the risk of the Group, increasing stability
and implementing operational improvements. This included
a comprehensive review of the Group’s balance sheet and
accounting policies and addressing a number of significant
historic issues.
The new management team are confident that a re-
focussed and aligned RBG can return to higher margins,
strong cash generation, and industry leading KPIs over the
course of 2024. The Group’s core legal services business has
a proven track record of delivering growth through many
economic cycles.
The interests of management and senior staff are aligned
with those of shareholders as many hold substantial equity
stakes. The Group is run by experienced directors and senior
managers with considerable expertise in the legal services
industry, and in UK listed companies.
Strategic Report 10
Chair’s
statement
Marianne Ismail
Chair
Overview
We recognise that 2023 was a challenging year, but it was also a year
of inflexion for the Group and the significant progress in realigning the
business gives the Board confidence that the Group is on a much stronger
footing than it has been for some time. The new Executive team, led by CEO
Jon Divers, has made difficult decisions to reduce the Group’s risk profile, its
cost base and to refocus RBG on its core legal activities, similar to the business
that floated in 2018, where the Board believes profits can be maximised.
11
Rosenblatt was ranked in Tier 1 in The Legal 500
(Legalease) in 2024 for commercial litigation. Memery
Crystal was ranked in 12 categories in The Legal 500
(Legalease) directory in 2024.
Both brands have over 30 years’ proven trading history
and the ability to deliver solid revenues and profits. Driving
the organic growth of these businesses is at the heart of
our strategy, and we believe that by focusing on our core
strengths, with a simpler balance sheet, and reduced levels
of debt, the market will be able to recognise the underlying
value of the Group.
It was clear that the strategy and approach adopted by the
previous management which deviated from the original
strategy presented at IPO, was no longer appropriate. The
required resources to reorient to a new strategy drained the
business of profit and working capital, at a time when there
have been significant macro-economic challenges impacting
the Group. Two significant changes to derisk and strengthen
the balance sheet were the 2023 disposal of LionFish
Litigation Finance Limited (“LionFish”), and the post-period
end disposal of Convex Capital Limited (“Convex Capital”).
Today the business is much closer to the one that floated
in 2018 and in the view of the Board is stronger. At IPO,
we floated the law firm, Rosenblatt to which in 2021 we
added Memery Crystal to form RBG Legal Services Limited
(“RBGLS”). Rosenblatt and Memery Crystal are aligned to
contentious and non-contentious services to reflect their
brand position within the market, resulting in London’s
premier mid-tier law firm providing quality advice to
corporates, entrepreneurs and high net worth individuals.
Driving the organic growth of these
businesses is at the heart of our strategy,
and we believe that by focusing on our
core strengths, with a simpler balance
sheet, and reduced levels of debt, the
market will be able to recognise the
underlying value of the Group.
Strategic Report 12
Financials4
Strategy
Board Changes
People
13
Revenue of £39.2m (2022: £44.9m, excluding gains
on litigation assets)
Adjusted EBITDA of £4.6m (2022: £12.4m)
Loss before tax £11.4m (2022: £2.1m)
Loss from continuing operations £11.0m (2022: £1.6m)
Loss on discontinued operations (including goodwill
impairment), net of tax £12.9m (2022: loss £3.1m)
The numbers we have reported for the 12-months to 31
December 2023 highlight the headwinds the business has
faced. Revenue and profit from our continuing operations
has reduced, largely due to lower corporate spend on legal
services, in particular relating to transactions such as IPOs
and M&A. We also had to make provisions in relation to the
legacy the previous management left in terms of unfunded
Damages Based Agreements (DBAs) and historic debtors.
As we progress through 2024, we do so with noticeably
improved operating processes that will begin feeding
through in terms of improved margins. We have taken steps
to reduce our cost base, including the consolidation of our
property portfolio, and we have a much simpler balance
sheet that will give greater clarity to investors.
Our new agreement with HSBC and recent successful
fund raise gives the management team the operational
headroom to deleverage the business more quickly as it
brings operational performance back up to acceptable
levels. At 31 December 2023, our net debt position was
£22.9m (2022: £19.2m). The Group has a £17.5m revolving
credit facility and a £10.0m five-year term loan taken to
fund the Memery Crystal acquisition which has already
been paid down to £6.5m. In addition to this, the Group
has two short term facilities that were obtained in the
current year of £0.3m and £0.5m, these respective facilities
have been paid down to £0.2m and £0.4m at year end.
We are committed to reducing debt as a core part of
our strategy.
The Group’s strategy is to build a high margin, cash-generative,
legal services group with diversified revenue and profit streams
to deliver organic growth and sustained shareholder value.
The successful acquisition of Memery Crystal in 2021
diversified our legal services revenue, which remains evenly
split across three main practice areas; Dispute Resolution,
Corporate and Real Estate. While the prevailing economic
environment has been challenging, we see considerable
opportunity in these core business areas, as the economic
outlook improves, and operational improvements take hold.
These improvements include the recruitment of seven new
partners, the implementation of a new ERP management
information system to enhance workflow across the different
practices and focusing on improving the performance of
all fee earners through providing more timely and robust
key performance indicators (KPIs) pertaining to fee earner
performance, such as utilisation rates, recovery rates, and
fee cost ratios.
Our emphasis will be on driving organic growth by recruiting
and developing new fee earners. In 2023, we added seven
new partners, and as at 31 December 2023, RBG Legal
Services had 128 fee earners overall.
To ensure the Business remains absolutely focused on
its goal, the Board took the decision to divest LionFish
where litigation matters are run by third-party solicitors
and reduce the Group’s exposure to third-party litigation
funding commitments. The proceeds from the sale were
used for working capital purposes. The Group will not
participate in unfunded Alternative Billing Arrangements
due to their unpredictability.
After the period-end in March 2024, we also sold Convex
Capital to its management for a total consideration of
up to £2.6 million, comprising an initial cash consideration
of £2.0 million paid on completion and an earn out
contingent on the completion of certain subsequent
transactions. Convex Capital is an excellent business, but
the unpredictable nature of the M&A market meant it was
hard to forecast revenue flows in any one year. Convex
Capital also required working capital from the Group, which
we believe can be better deployed to support the core
legal services business and to help reduce debt.
Following the disposals, the Group is focused purely
on legal services, and we expect to go from strength to
strength as a result.
On 31 January 2023, the employment contract of Nicola
Foulston, CEO, was terminated. The Group subsequently
settled a claim from her and her management company
Velocity Venture Capital Limited which settles all outstanding
matters between the parties.
The strength of the Group is in our ability to retain and attract
high-quality people. Despite the challenging year, we have
retained and added to our key staff. I would like to sincerely
thank everyone for their hard work and thanks are also due to
our shareholders for their continued support.
Jon Divers, the Group COO, was appointed to the Board
as CEO. The Board was further strengthened with the
appointments of Tania MacLeod (Senior Partner, Rosenblatt),
Nick Davis (Senior Partner, Memery Crystal) and Ian
Rosenblatt OBE (largest shareholder and individual revenue
generator) as Executive Directors. In November, Kevin
McNair, Interim Finance Director, was appointed to the
Board as Chief Financial Officer. Kevin replaced Suzanne
Drakeford-Lewis, who resigned from her role in June 2023,
to take a six-month sabbatical for personal reasons, and
subsequently confirmed to the Board of her decision not to
return in 2024. Following the disposal of Convex Capital, Ian
Rosenblatt resigned from the Board. He joined the Board to
support the restructuring and refocusing of the business to
legal services. Ian remains fully committed to the Group and
has circa four years remaining on his restrictive covenants.
The Board now consists of four executive directors and
three non-executive directors, providing a blend of different
experiences and backgrounds. All non-executives are
considered independent. We are in the process of recruiting
another independent non-executive director to strengthen
the independence of the Board and to ensure strong
corporate governance and the Board hopes to complete
this process prior to the Company’s 2024 Annual General
Meeting expected to be held in (or around) June 2024.
Sustainability, Equality, Diversity
and Inclusion
We aim to build an organisation that delivers long-term value
to our shareholders, successful outcomes for our clients, and
is a responsible employer that supports its employees and
has a positive impact in the communities in which it operates.
For example, this year we have partnered with the Sutton
Trust to run work experience and mentoring programs for
university students. We also elected KEEN London as our
Charity of the Year for 2023.
While the nature of the business means the Group does not
have a significant environmental impact, the Board believes
that good environmental practices, such as the recycling of
paper waste and conservation of energy usage, will support
its strategy by enhancing the reputation of the Group. For
example, our Fleet Street address has 100% renewable
power supply, and the waste is 100% recycled or waste
converted to energy (no landfill).
We want to go further and are looking at ways we can
improve as an employer, and as a member of the business
community to address the challenges society is facing.
Outlook
With much of the restructuring completed, and a better
economic outlook, the Group is in a much-improved
position. The business has returned to its roots, and is
built around two highly successful law firms, with proven
track records across the whole economic cycle. We are
continuing to reduce our cost base and are making
significant operational improvements to increase
revenue and improve margin. We look forward to the
coming years with renewed confidence.
4
All measures apart from net debt and including prior year comparatives are shown on a continuing
operations basis unless otherwise stated (Convex Capital and LionFish Litigation Finance are treated as
discontinued operations).
Marianne Ismail
Chair
30 April 2024
Strategic Report 14
15
Chief Executive
Officer’s statement
Overview
2023 has been a year of significant change in the business as we work
to deliver the Board’s strategy of building a high margin, cash-generative,
legal services group delivering sustained shareholder value.
Our legal services business trades under two leading
mid-tier law firm brands – Rosenblatt and Memery Crystal,
which have their own brand identities and operate as two
separately branded law firms. The two brands are aligned
to contentious (Rosenblatt) and non-contentious (Memery
Crystal) legal services to reflect their distinct position within
the legal services market. RBGLS has a balanced offering
across the three main legal areas – Dispute Resolution
(via Rosenblatt), and Corporate and Real Estate (through
Memery Crystal).
The organic growth of the two firms, primarily through
accretive hires, is key to our future success. We are focused
on strengthening and growing in all areas we work in, by
improving the performance of all fee earners, and adding
seven new partners during 2023. Some strengthen our
existing practices, and others add new areas of expertise as
we look to build a full-service law firm. The recruitment has
added two new areas so far, insolvency, and international
arbitration. The partners in these areas are already gaining
traction in their specific markets and are generating new
revenue streams.
One of the keys to sustained operational improvement
has been the implementation of a new ERP management
information system in May, and we are already seeing
the benefits. Ensuring all partners have access to the
same document and time management systems, not only
enhances the workflow across the different practices, but
it also provides more timely and robust key performance
indicators (KPIs) pertaining to fee earner performance,
such as utilisation rates, recovery rates, and fee cost ratios.
This consolidated approach eliminates the inefficiencies
associated with managing separate systems, allowing for
a more seamless flow of information, and enabling the
Group to make data-driven decisions that optimise resource
allocation and drive operational excellence.
As we enter 2024, the two businesses are fully integrated
and based at one office on Fleet Street in London, with work
ongoing to rationalise our property portfolio to reduce cost.
We have focused on reducing the risk profile of the Group
by disposing of non-core assets such as LionFish and Convex
Capital and scaling back from unfunded DBAs. We have
also strengthened the balance sheet through a successful
fundraise and renewed banking facilities and there has been
a comprehensive review of all aspects of the accounting
treatments of work in progress and debtors.
Additionally, we are implementing significant operational
improvements in our core legal services business, RBGLS,
to meet the goal of being a high margin, cash-generative
group. These changes will leave the Group in a far stronger
position than at the start of 2023, especially as the macro-
economic environment improves.
RBG Legal Services (“RBGLS”):
Rosenblatt and Memery Crystal
• Revenue down 12.6% to £39.2m (2022: £44.9m)
reflecting reduced corporate spend relating to
transactions such as IPOs and M&A
• RBGLS fee earner utilisation of 70% (2022: 76%)
and realisation of 87% (2022: 90%)
• At 31 December 2023, RBGLS employed 183
people, including 128 fee earners
We have made significant
improvements to the business in
2023 and we are now in a better
position to deliver the Board’s
strategy of building a high margin,
cash-generative, legal services
group delivering sustained
shareholder value.
Jon Divers
Group CEO
Strategic Report 16
17
Discontinued Operations
LionFish Litigation Finance Limited (“LionFish”)
On 12 July 2023, the Group completed the disposal of the
non-core business, LionFish, to Blackmead Infrastructure
Limited (“Blackmead”) which reduced the Group’s exposure
to litigation funding commitments.
Convex Capital Limited (“Convex Capital”)
• Completed three deals during 2023 delivering £2.2m of
revenue (2022: 6 deals, £5.3m)
Convex Capital, the specialist sell-side corporate finance
advisory business based in Manchester, was acquired by
the Group in September 2019, to broaden the Group’s
exposure to the wider professional services sector and was
sold in March 2024 via a management buyout (MBO) of
the business.
As with the sale of LionFish, the disposal was in line with the
Group’s strategy to reduce its risk profile and to refocus on
and invest in RBG’s established legal services businesses -
Rosenblatt and Memery Crystal - where the Board believes it
can best maximise profits.
The management of Convex Capital acquired the business
from the Group for a total consideration of up to £2.6 million,
comprising an initial cash consideration of £2.0 million paid
on completion and an earn out. Under the terms of the earn
out, post completion of the Disposal, the Company will
receive 38% of any gross fees received upon completion of
four existing and named Convex projects up to a maximum
of £0.6 million in cash. The disposal will result in a non-cash
loss of £13.3 million.
While Convex Capital is an excellent business, its future is
better served in the hands of its management team. As with
LionFish, its sale will mean concentrating the resources of
the Group on its core legal services businesses to maximise
profits, using the released cash to reduce RBG’s net debt and
to invest in organic growth.
The disposal will reduce the demands on the Company’s
working capital, through a reduction of circa £2.2million per
annum in ongoing costs in relation to Convex.
In the 12-months to 31 December 2023, Convex
Capital generated revenues of £2.2 million (FY22: £5.3
million) and losses after tax of £0.2 million (FY22: profit
of £0.9 million).
Outlook
We have made significant improvements to the business in 2023 and we
are now in a better position to deliver the Board’s strategy of building a
high margin, cash-generative, legal services group delivering sustained
shareholder value. We have enhanced our operations which will lead to
sustained margin improvements and have also added more fee earners.
This, along with our actions to derisk the business, and to simplify and
strengthen the Group’s balance sheet, give us a greater confidence about
the performance of the Company as the market improves.
Jon Divers
Group Chief Executive Officer
30 April 2024
Strategic Report 18
Strategic
report
19
Principal activities, strategy and outlook
Revenue
The principal activity of RBG Holdings plc, “the
Group”, during the year was the provision of legal
and professional services.
The Group’s legal services business, RBG Legal Services
(“RBGLS”), trades under two leading mid-tier law firm
brands, Rosenblatt (“RB”) for contentious work and
Memery Crystal (“MC”) for non-contentious work.
The Group’s strategy is to continue to build a high
margin, cash-generative, legal services business with
diversified revenue streams, with more emphasis on
driving organic growth and when appropriate making
selective, strategic acquisitions.
Financial Review
Key Performance Indicators (KPIs)5
Revenue down 12.6% to £39.2m (2022: £44.9m, excluding
proceeds on disposal of damages based assets)
- Revenue including discontinued operations
down 13.4% to £41.4m (2022: £47.9m)
Group revenue for the period was £39.2m compared to
£44.9m in 2022, representing a 12.6% decrease. As Convex
is treated as an asset held for sale, the Group revenue reflects
the performance of Legal Services.
Revenue across the Legal Services departments was
impacted by different factors. Dispute Resolution (42% of
total revenue) was down 9.5%. This department benefited
from an unusually large case in H2 2022 so its performance in
2023 was broadly in line with expectations.
Corporate revenue (38% of total revenue) was down 12.1%,
reflecting the depressed state of the equity capital markets
and lower M&A activity. M&A activity began to pick up in Q4
of 2023 and this continued in Q1 2024. There are early signs
of improvement in the equity capital markets in 2024 but this
is unlikely to turn into revenue growth until H2.
Real Estate (20% of total revenue) was down 22.2%. This
reflects the historically low levels of activity across all parts
of the commercial real estate sector. Although there are
early signs of recovery in parts of the sector, management
expectations for revenue growth in 2024 are cautious.
Adjusted EBITDA down 62.5% to £4.6m (2022: £12.4m)
Other operating income
- Adjusted EBITDA including discontinued operations
down 54.3% to £4.0m (2022 restated: £8.7m)
Other operating income of £0.9m (2022: £0.2m) relates to
net interest earned on client monies held.
Adjusted loss before tax of £0.7m (2022: profit £7.6m)
Non-recurring costs of £10.6m (2022: £9.7m)
Loss before tax £11.4m (2022: £2.1m)
Loss from continuing operations £11.0m (2022: £1.6m)
Loss on discontinued operations (including goodwill
impairment), net of tax £12.9m (2022: loss £3.1m)
Loss for the year (including discontinued operations)
of £23.9m (2022: £4.7m)
Free cashflow outflow (£3.1m) (2022: inflow £4.0m)
Net debt of £22.9m (2022: £19.2m)
RBG Legal Services fee earner utilisation of 70% (2022: 76%)
RBG Legal Services fee earner realisation of 87% (2022: 90%)
2023 was a challenging year for the Group. However, the
significant progress in realigning the business gives the Board
confidence that the Group is on a much stronger footing than
it has been for some time.
The Group has now noticeably improved operating
processes that have begun feeding through in terms of
improved margins in 2024. Our new agreement with HSBC
alongside the recent successful fundraise gives the Group
operational headroom to de-leverage the business while
Group performance begins to improve.
There are early signs of recovery in some of the key areas of
legal services that were badly impacted in 2023. We expect
revenue and profit to improve in 2024. Continuing to focus
on the Group’s operational efficiency, expanding margins and
generating cash are the key priorities for the Board.
Disbursement asset revenue and expenditure
Disbursement asset revenue and expenditure relates to
funds invested in disbursements on RBGLS’ Damages
based agreement (‘DBA’) cases. Due to an error identified in
accounting policies, these cases are now accounted for under
IFRS 15. Refer to notes 2 and 8 for further explanation.
Staff costs5
Total staff costs in 2023 were £26.9m (2022: £27.2m), which
includes £25.7m for legal services. The average number of
employees for the Group was 200 (2022: 211).
Overhead costs5
During 2022, the Group incurred overheads of £46.5m
(before depreciation and amortisation) (2022: £44.0m), of
which staff costs were £26.9m (2022: £27.2m).
Other overhead costs were £19.6m (2022 restated: £15.0m),
of which non-recurring costs, represented £10.6m (2022:
£9.7m). Other costs included insurances of £1.4m (2022:
£1.8m), rates £0.7m (2022: £0.9m), and training and
recruitment £0.7m (2022 £0.6m).
Operationally, there remains a significant focus on IT and
we have invested sensibly over recent years and further
enhanced both our internal and client facing experiences of
IT usage.
5
All measures apart from net debt are shown on a continuing operations basis unless otherwise stated. Prior year comparatives are also shown on a continuing operations basis. Further details on discontinued operations can be
found in Note 13.
The Directors present their
Strategic Report for the year
ended 31 December 2023.
Strategic Report 20
21
EBITDA and Adjusted EBITDA6
In assessing performance, the Group uses EBITDA and
adjusted EBITDA as important KPIs. EBITDA loss was a loss
of £5.1m, including £10.6m of non-underlying items (2022:
EBITDA £2.7m including non-underlying items of £9.7m).
Adjusted EBITDA for 2023 was £4.6m (11.8% of revenue) (2022
restated: £12.4m, 27.5%). Legal Services adjusted EBITDA
margin of 17.0% (2022: 33.2%) was impacted by a decline in
revenue, due to lower corporate spend on legal services, in
particular relating to transactions such as IPOs and M&A.
Profit before tax
Loss before tax for 2023 was £11.4m, (2022: £2.1m); this
includes £10.6m of non-underlying items (2022: £9.7m).
Adjusted7 loss before tax was £0.7m, (2022: profit £7.6m).
Corporation tax
The Group’s tax benefit for the year is £0.3m with an effective
tax rate of 2.8% (2022 restated: £0.5m, 22.2%).
Discontinued operations
On 12 July 2023, the Group completed the disposal of the
non-core business, LionFish to Blackmead Infrastructure
Limited (“Blackmead”) which reduced the Group’s exposure
to litigation funding commitments.
Convex has been classified as held for sale and has been
excluded from our headline performance measures.
Operating losses before non-underlying items for Convex
were £0.2m (2022: operating profit £1.2m). Total losses after
tax for the business for 2023 totalled £0.2m (2022: profit
after tax £0.9m).
Details on discontinued operations are shown in Note 13.
Earnings Per Share (EPS)6
The weighted average number of shares in 2023 was
95.3 million which gives a basic earnings per share (EPS) on
continuing operations for the year of (11.58p) (2022: restated
(1.73p)) and diluted earnings per share (EPS) on continuing
operations for the year of (11.56p) (2022: (1.72p)).
Balance Sheet
Goodwill, intangible and tangible assets
Current Assets
Current Liabilities
6
Assets held for sale
Liabilities held for sale
6
Net debt
Non-Current Liabilities
Net assets
2023
£’m
55.1
19.1
(13.8)
3.3
(1.0)
62.7
(22.9)
(11.4)
28.4
8
2022
£’m
55.3
27.9
(12.2)
22.5
(7.5)
86.0
(19.2)
(14.1)
52.7
The Group’s net assets as at 31 December 2023 decreased
by £24.3m on the prior year as a result of the losses
recognised in 2023 as well as impairment in Convex
intangible assets.
Goodwill, Tangible and Intangible Assets6
During the year, the management team took the decision to
write off all remaining litigation assets from the balance sheet.
This was tied to the Board’s decision to step back from
significant Damages based agreement (DBA) cases similar to
those the Group had undertaken in the past.
Previously, disbursements incurred on these DBAs were held
on the balance sheet as litigation assets and measured under
IFRS 9 at fair value through profit or loss.
Based on the substances of the underlying agreements for
the two damages based agreements, the recovery from the
client of disbursements represents a revenue stream arising
from costs to fulfil a contract with a customer and therefore
falls within the scope of IFRS 15, not IFRS 9. This is because
IFRS 9 states that it does not apply to “rights and obligations
within the scope of IFRS 15 that are financial instruments,
except for those that IFRS 15 specifies are accounted for in
accordance with IFRS 9”.
Refer to notes 2, 3, 22 and 32 for further information on this
prior period adjustment.
Included within tangible assets is £12.4m (2022: £14.4m)
which relates to IFRS 16 right of use assets for the Group’s
property leases.
Total intangible assets of £40.5m (2022: £38.7m)
incorporate the goodwill and intangible assets acquired
on the acquisitions of the Rosenblatt, and Memery Crystal
businesses. During the year, the Group extended Ian
Rosenblatt’s restrictive covenant, refer to note 18 for further
information. The Group has considered the amounts at
which goodwill and intangible assets are stated on the basis
of forecast future cash flows and concluded that that these
assets have not been materially impaired.
6
7
8
All measures apart from net debt are shown on a continuing operations basis unless otherwise stated.
Prior year comparatives are also shown on a continuing operations basis. Further details on discontinued
operations can be found in Note 13.
The Group presents adjusted profit before tax as an operating KPI, it is adjusted for one off costs that are
considered to be exceptional, refer to Note 1 for further information.
Comparatives have been restated to present Convex as a discontinued operation. Refer to Notes 1 and
13 for further details.
Working capital9
Management of lock up and cash generation has continued
to be a key focus of the Group over the year. For the Legal
Services business, lock up days is a measure of the length of
time it takes to convert work done into cash. It is calculated
as the combined debtor and WIP days.
Lock up days at 31 December 2023 were 127 (2022 restated:
137), with debtor days being 49 (2022: 58 days) and WIP
days being 77 days (2022: 79 days). Lock up has decreased
from the previous year due to the increase in provision made
against trade receivables. This is an area of significant focus
for management.
Trade debtors less provision for impairment at the end of the
year were £8.0m (2022: £9.9m) and contract assets (work in
progress) at the year-end were £8.2m (2022: £9.7m).
Net debt9
We have a revolving credit facility (RCF) of £17.5m and
an acquisition term loan of £10.0m, of which, a total of
£3.5m had been repaid at 31 December 2023. Our net
debt position at the year end was £22.9 million (2022:
£19.2 million).
Cash Conversion10
Cash flows from operating activities
Movements in working capital
Increase in litigation assets
Net cash (used in)/generated from operations
Interest
Capital expenditure
Free cash flow
Underlying loss after tax
Cash conversion
2023
2022
£’m
(5.1)
4.3
(0.3)
(1.1)
(1.7)
(0.3)
(3.1)
(10.2)
£’m
12.8
0.5
(7.8)
5.4
(1.3)
(0.2)
4.0
(4.7)
30% (84%)
The cash conversion percentage measures the Group’s
conversion of its underlying profit after tax into free cash
flows. Cash conversion was 30% in 2023 (2022: (84%)).
Summary
We have made significant changes to the business in 2023
and we are now in a better position to deliver the Board’s
strategy of building a high margin, cash-generative, legal
services group delivering sustained shareholder value.
Going concern
The Group’s business activities, together with the factors
likely to affect its future development, performance and
position, are set out in the financial review pages 18 to 21,
together with the financial position of the Group, its cash
flows, liquidity position and borrowing facilities.
Financial projections have been prepared to April 2025, the
going concern review period, and form part of a three-year
plan which show positive earnings and cash flow generation
and projected compliance with banking covenants at each
testing date.
The Board confirm that they have a reasonable expectation
that the Group has adequate resources to continue in
operational existence for at least 12 months from the date of
signing these financial statements.
This confirmation is made after reviewing assumptions about
the future trading performance. This process included a
reverse ‘stress test’ used to inform downside testing which
identified the break point in the Group’s liquidity. Whilst the
sensitivities applied do show an expected downside impact
on the Group’s financial performance in future periods, for
all scenarios modelled the Board have identified appropriate
mitigating actions to ensure that the Group maintain a robust
balance sheet and liquidity position. Possible mitigating
actions considered include lowering capital expenditure,
reductions in personnel and overhead expenditure and other
short-term cash management activities within the Group’s
control as part of their assessment of going concern.
The Group expects to be able to operate within the Group’s
financing facilities and in accordance with the covenants
set out in all available facility agreements. Accordingly, the
Directors have a reasonable expectation that the Company
and the Group have adequate resources to continue in
operational existence for the foreseeable future and they
have adopted the going concern basis of accounting in
preparing the annual Group financial statements.
9
All measures apart from net debt are shown on a continuing operations basis unless otherwise stated. Prior year comparatives are also shown on a continuing operations basis. Further details on discontinued operations can be
found in Note 13.
10 Comparatives have been restated to present Convex as a discontinued operation. Refer to Notes 1 and 13 for further details.
Strategic Report
22
23
Principal risks and
uncertainties
The Board monitors both existing and emerging risks, recording these
in a risk register and regularly assesses their status. Due to the nature of
the business and the markets in which it operates, many of the risks it
faces are ongoing over longer than any single year. The principal risks
and uncertainties identified by the Board are detailed below.
Risk description and impact
Mitigating factors
Recruitment is led by our HR team and the talent
management team within that. Over the last 12 months,
our recruitment process has been developed to include
a strong value proposition for candidates. Remuneration
arrangements include a range of benefits and are
competitive. A comprehensive training programme is
in place for all staff providing management, leadership,
technical and skills training. The Board is responsible for
the implementation of succession plans for each of the
businesses and investment continues to be made in the
recruitment of appropriate staff where required.
The Group constantly endeavours to maintain its
reputation as a provider of client focused commercial
advice and has adopted internal management
processes and training programmes to support this.
While the Group will use all reasonable endeavours to
protect its intellectual property rights, should this be
required, it may not be able to prevent any unauthorised
use or disclosure of its intellectual property having an
adverse effect on the operating, marketing, and financial
performance of the Group.
Our people
Well trained and experienced people are essential for
the delivery of excellent professional services and is
fundamental to our success. The market for such people
remains competitive and the loss of or failure to recruit
and retain such people could impact on the Group’s
ability to deliver professional services and financial
performance. A failure to implement effective succession
planning throughout the business could also adversely
affect financial performance.
Reputation
The success of the Group’s business depends on
the maintenance of good client relationships and its
reputation for providing high-quality, highly valued
professional services. If a client’s expectations are not met,
or if the Business is involved in litigation or claims relating
to its performance in a matter, the reputation of the Group
could be significantly damaged. The Group’s reputation
could also be damaged through Rosenblatt’s involvement
(as an adviser or as a litigant) in high-profile or unpopular
legal proceedings. Rosenblatt may be required to incur
legal expenses in defending itself against any litigation
arising in, or out of, such cases and may also incur
significant reputational and financial harm if such litigation
is successful or if there is negative press coverage.
The Group regards its brand names, domain names,
trade secrets and similar intellectual property as
important to its success. Its businesses have been
developed with a strong emphasis on branding. Should
the brand name of Rosenblatt, or Memery Crystal be
damaged in any way or lose market appeal, the Group’s
businesses could be adversely impacted.
Risk description and impact
Mitigating factors
Operational risk and IT systems
The Group places significant reliance on its IT systems,
any loss of these facilities would have a serious impact
on the Group’s operations. The Group can give no
assurance that all such risks will be adequately covered
by its existing systems or its insurance policies to
prevent an adverse effect on the Group’s financial
performance. During the year the Group successfully
transitioned to a new enterprise resource planning
‘ERP’ management system.
The Group is also susceptible to cyber risks which
continue to increase within the legal and other
professional services sectors. The risk relates primarily
to the malicious hacking of the Group’s and/or client
data, or ransom attacks.
Professional liability and uninsured risks
The Group provides predominantly legal advice.
Like all providers of professional services, it is
susceptible to potential liability from negligence,
breach of client contract and other claims by clients.
As well as the risk of financial damage, such claims
also carry a risk of damage to the Group’s reputation.
The professional indemnity insurance held by the
Group may not cover all potential claims or may not be
adequate to indemnify the Group for all liability that
may be incurred (or loss which may be suffered). Any
liability or legal defense expenses that are not covered
by insurance or are in excess of the insurance coverage
could have a material adverse effect on the Group’s
business and financial condition.
Regulatory and compliance risks
The Group is subject to a range of regulations.
Failure to comply with these could have significant
implications for the business ranging from reputational
damage to criminal prosecution and sentencing. The
Group seeks advice from both internal and external
experts to support it in its adherence to applicable
regulations and guidelines.
Through duty of confidentiality and non-disclosure,
the SRA regulates the use and disclosure of client
information. The Group is exposed to the risk of
employees engaging in misconduct, including the
improper use or disclosure of confidential client
information. Employee misconduct could result in
considerable harm to the Group’s reputation, as well as
regulatory sanctions and financial damage.
The Group monitors the resilience of IT information
systems and other facilities on an ongoing basis.
The Group, and external partners assisting in the
development and implementation of the new system
have undertaken risk assessment procedures and
believe that adequate safeguards are in place to
minimise the risk of loss or disruption to the business.
The Group has an ongoing programme to implement
procedures and controls to mitigate this risk and
external advice is sought as appropriate. The Group
monitors the resilience of its information systems and
other facilities on an ongoing basis, introducing updates
and upgrades as appropriate.
The Group regularly reviews its security arrangements,
to identify and subsequently address weaknesses within
the current systems. The Group has a cyber insurance
policy in place to help to mitigate this risk.
The Group is advised by market leading insurance
brokers and the Directors believe that it holds
comprehensive professional liability insurance. Any
claims are defended strongly with senior members of
the business involved at all stages and external advice
is sought where appropriate. The Group works hard
to ensure its employees provide excellent advice and
service to its clients underpinned by quality processes
and bespoke training programmes.
The Directors of RBGLS are in dialogue with the SRA to
minimise such risk as far as they are able, and to ensure
that this regulation is made known to shareholders.
The SRA also has power to force the divestment of any
shareholding which breaches this rule via the courts and/
or to suspend or revoke the Licensed Body status of
RBGLS, which would have a serious effect on the Group.
We have invested in RBGLS’ compliance team to
ensure that the business manages risks and complies
with the SRA Accounts Rules. Remedial action
necessary for any breaches identified during the year
or as part of the annual review is communicated to
RBGLS by the Compliance Officer for Legal Practice
(‘COLP’) and/or Compliance Officer for Finance and
Administration (‘COFA’).
Staff are trained and reminded of these duties and
although management processes are in place to
mitigate this risk, it cannot be removed in full.
Strategic Report 24
25
Streamlined energy and carbon reporting
Greenhouse gas emissions (‘GHG’) statement.
The Group has reported scope 2 and 3 greenhouse gas
(‘GHG’) emissions in accordance with the requirements of
Streamlined Energy and Carbon Reporting (‘SECR’).
Energy and GHG sources included in the process:
• Scope 2: Purchased electricity
• Scope 3: Fuel used for business travel in employee-
owned or hired vehicles
The table opposite details the regulated SECR energy and
GHG emission sources for the current reporting period 1
January 2023 to 31 December 2023.
The figures were calculated using UK government conversion
factors, expressed as tonnes of carbon dioxide equivalent.
Energy (kWh)
Gas
Electricity
Transport
Total energy (kWh)
Emissions (tCO2e)
Gas
Electricity
Transport
Total emissions (tCO2e)
Intensity (tCO2e/£m revenue)
Revenue (£m)
tCO2e per £m of revenue
Intensity (tCO2e/FTE)
Full time equivalent employees
tCO2e per FTE
31 Dec 2023
31 Dec 2022
restated11
259,031
410,375
11,849
681,255
256,498
361,488
13,833
631,819
47.3
85.0
2.1
134.4
42.1
3.2
200
0.7
46.8
69.9
1.6
118.3
50.3
2.4
211
0.6
The Board believes that good environmental practices, such
as the recycling of paper waste and conservation of energy
usage, will support its strategy by enhancing the reputation
of the Group. The number one consumable in the legal and
professional services sector is paper, which has traditionally
been used heavily in law firms. Hybrid and flexible working
have significantly reduced paper consumption and accelerated
habit changes and our focus is to sustain and expand these
good habits and skills. Due to the nature of its business, the
Group does not have a significant environmental impact.
11 2022 figures have been restated to reflect an error in
the gas consumption figures taken from meter readings.
Section 172 Statement
This section serves as our Section 172 (“s172”) statement and
should be read in conjunction with the Strategic report and
the Corporate Governance statement.
The Directors are aware of and comply with their duty under
Section 172 of the Companies Act 2006 to act in the way
which they consider, in good faith, would be most likely to
promote the success of the Company for the benefit of its
members as a whole and, in doing so, to continue to have
regard (amongst other matters) to:
• the likely consequences of any decision in the long term
• the interests of the Company’s employees
• the need to foster the Company’s business relationships
with suppliers, customers and others
• the impact of the Company’s operations on the
community and the environment
• the desirability of the Company maintaining a reputation
for high standards of business conduct, and
• the need to act fairly between members of the Company
In this context, acting in good faith and fairly, the Directors
consider what is most likely to promote the success of the
Company for its members in the long term. We explain
in this annual report, and below, how the Board engages
with stakeholders.
• The Board regularly reviews the Company’s principal
stakeholders and how it engages with them. This is
achieved through information provided by management
and by direct engagement with stakeholders themselves
• Relations with key stakeholders such as employees,
shareholders and customers are considered in the
running of the business on an everyday basis
• We aim to work responsibly with our stakeholders.
The Board regularly reviews policies and procedures,
including those around anti-corruption and anti-bribery,
equal opportunities and whistleblowing
• The Board engages and interacts with our teams through
the use of intranets, monthly email updates and news
flash emails
The key Board decisions made in the year are set out below:
Significant
events/decisions
Key s172
matter(s) affected
Key s172
matter(s) affected
Decision to divest
the specialist sell-side
corporate finance
advisory business,
Convex
Shareholders,
employees, clients
Convex Capital is an excellent business, but the
unpredictable nature of the M&A market meant it was
difficult to forecast revenue flows in any one year. Convex
Capital also required working capital from the Group which
we believe can be better deployed to support the core
business and to help reduce debt.
Dividend
Shareholders,
employees
Approval of
2024 budget
Employees,
shareholders
and clients
During 2023, the Board announced it was suspending
the Group’s dividend policy for the foreseeable future.
The Board recognises the importance of dividends to
shareholders and will reinstate its dividend policy once it
has made headway in reducing the Group’s debt to a more
prudent level.
The Group’s business plan is to drive sustainable growth in
the long term, which is in the interest of all stakeholders.
The Board has paid close consideration to this objective in
establishing and approving the 2024 budget. In the current
economic climate this has involved close monitoring of the
impact of the current economic uncertainty on each sector
in which the Group operates, ensuring no over reliance on
a single market or client; ensuring the Group is best placed
to continue delivering a high standard of client service and
increasing focus on minimising our environmental impact.
The Directors consider that they have acted in the way most likely to promote the success of the Group for the benefit of its
members as a whole.
Strategic Report
26
Corporate Social
Responsibility
Charities and
communities
The Group aims to build an organisation that delivers long-term value to
its shareholders, successful outcomes for its clients, and is a responsible
employer that supports its employees and has a positive impact in the
communities in which it operates.
Social responsibility
Sustainability
We believe that running a profitable and growing business,
which creates jobs and contributes to the economic success
of the areas in which it operates, is a platform for good
corporate social responsibility. We have a long-standing
commitment to support our staff in engaging with their local
communities and charities. This social awareness is present
throughout the business, from our employees to our clients,
our professional connections and the suppliers we use.
To deliver strong, sustainable shareholder returns over the
long-term, the operation of a profitable business is a priority
and that means investing for growth. To achieve this, the
Group recognises that it needs to operate in a sustainable
manner and therefore has adopted core principles to its
business operations which provide a framework for both
managing risk and maintaining its position as a good
‘corporate citizen’.
27
Every year, the Group partners with a charity, as voted by
staff, to provide fundraising support. In 2023, the chosen
charity was KEEN London. KEEN addresses the lack of
support for young people with additional needs to access
meaningful employment or volunteering opportunities and
gain valuable transferable skills. They provide free and highly
sought-after one-to-one support to children with additional
needs at sports and games sessions in some of the most
deprived parts of London.
Highlights from the year of fundraising include staff
competing in a Tough Mudder and Winter Walk, attending a
party for KEEN’s 21st Anniversary, and a large Christmas raffle,
with various smaller activities such as baking competitions and
dress down days throughout the year. The Group is proud to
have supported KEEN London and their cause.
In total, the Group raised £35,807 for our charity of the year
KEEN London. These funds paid for 350 hours’ worth of
sessions with over 100 children, plus allowing 15 preschool
children to attend KEEN’s ‘Rising Stars’ sessions. The money
raised also covered KEEN’s rent payments for a year. In a
survey conducted by the charity, 94% of families had noticed
an increase in wellbeing, and the charity also fed back
that they had rarely received such a high total from their
fundraising partners, historically.
Our charity for 2024
In December, staff voted to support Noah’s Ark Children’s
Hospice as its 2024 charity of the year.
Strategic Report 29
Equality,
Diversity, and
Inclusion
We are an equal opportunities employer, and it is our
policy to ensure that all job applicants and employees are
treated fairly and on merit regardless of race, sex, marital/
civil partnership status, age, disability, religious belief,
pregnancy, maternity, gender reassignment or sexual
orientation. We have an established Equality, Diversity and
Inclusion committee, which having surveyed employees,
develops an annual programme of training and events to
address any operational and training needs identified.
The Group is immensely proud of the work completed
by its’ various staff-led equality, diversity, and inclusion
networks in 2023.
The Group also continued to support
the Beyond the Bow initiative, which
organises Christmas presents and care
packages for disadvantaged children
in foster homes, those experiencing
homelessness or those who need
therapeutic care due to adverse
childhood experiences. In total, staff
donated 120 packages to the initiative,
beating their previous record.
28
Other charitable initiatives
2023 marks the Group’s fourth
consecutive year of working with
Sutton Trust, a social mobility charity
that designs programmes to support
students from underprivileged
backgrounds at university. The Sutton
Trust helps these students to gain
an insight into working life, as well
as giving them a chance to gain
the experience and skills needed to
apply for internships and graduate
roles. This year the Group organised
work experience placements for
16 students who had an interest in
becoming a lawyer.
This year, The Group also supported
MBA30, an exciting new initiative
launched by Black British Initiative
(BBI) in 2023 aimed at helping thirty
black entrepreneurs, by sponsoring
one student through their MBA. In
addition to this, Rosenblatt Legal
Director, Luther Kisanga, gave a talk
as part of the programme. The Group
are looking to build on this partnership
in 2024 by providing additional
support through our own professional
knowledge and via our wider contacts.
Strategic Report 30
The Black Ethnicity Network organised a number of
activities to coincide with Black History Month, including a
talk by Darren Miller, Founder of Black British Initiative (BBI),
which runs the aforementioned MBA 30 initiative, who was
joined by two alumni of the programme. In addition to this,
the network organised a talk and presentation from Sofia
Wham (co-founder of the UK’s first contemporary African
photography gallery) and Aisha Seriki (an artist specialising
in fine art photography). The Group also took part in a
street art tour through Shoreditch.
31
The Gender Parity committee celebrated International
Women’s Day in 2023 by hosting a women’s event on the
topic of miscarriage, baby loss, and fertility treatment.
The Group also promoted the stories of women who had
influenced the lives of staff.
The Disability and Neurodiversity network organised a talk
by Sara Gibbs, a comedy writer and autistic advocate, who
talked through a number of workplace neurodiversity tips.
The network also shared important and useful information
with the firm during UK Disability Awareness Month, and, to
mark World Mental Health Day, organised a talk by alcohol
awareness charity, Alcohol Change UK.
Lastly, the LGBTQ+ network hosted a Pride
Entertainment Night on 15 June which featured
a performance by the London drag queen and
event host, Kara Couture. The network also
shared useful definitions relating to lesbian,
gay, bisexual, transgender, and queer terms,
along with other sexual identities including
pansexuality and asexuality.
Strategic Report Corporate
Governance
Contents
Corporate Governance
Board of Directors
Corporate Governance statement
Directors’ report
34
36
42
32
Developing our people
Modern slavery
We are committed to preventing acts of modern slavery and
human trafficking from occurring within our business and
supply chain and expect our suppliers to adopt the same
high standards. As part of our commitment to combating
modern slavery, the Directors have approved the adoption
and implementation of a specific modern slavery policy. We
expect all of our suppliers to adhere to our Anti-Slavery Policy
and will not tolerate slavery and human trafficking within our
supply chains.
Our slavery and human trafficking statement, made in
accordance with section 54(1) of the Modern Slavery Act
2015 can be found on our website, www.rbgholdings.co.uk.
Anti-bribery policy
We value our reputation for ethical behaviour and upholding
the utmost integrity and we comply with the FCA’s clients’
best interests rule. We understand that in addition to the
criminality of bribery and corruption, any such crime would
also have an adverse effect on our reputation and integrity.
The Group does not tolerate bribery and corruption and
we ensure all our employees and suppliers are aware of our
approach as to limit our exposure to bribery by:
• Setting out clear anti-bribery and corruption policies
• Providing mandatory training to all employees
• Encouraging our employees to be vigilant and report
any suspected cases of bribery in accordance with the
specified procedures
Political donations
The Group made no political donations in the year
(2022: £nil).
Pages 18 to 32 constitute the strategic report, which has
been approved by the Board of Directors and signed on
its behalf by:
Kevin McNair
Chief Financial Officer
30 April 2024
The Group continues to create opportunities for staff at all
levels of the Group.
We have a strong track record as an employer of choice
in the provision of legal graduate traineeships and
apprenticeship schemes highlighting the Group’s motivation
to ‘grow our own’. Trainees work alongside qualified
professionals in completing a period of recognised training
(often known as a training contract) giving individuals
supervised experience in legal practice. This is the final stage
of the process of qualification as a solicitor where they refine
and develop their professional skills.
The Group operates two fee-earning networks dedicated to
our Junior Lawyers and Senior Lawyers. These groups allow
the relevant individuals to develop skills such as business
development, networking, and cross referring, all taking
place within a friendly and collaborative environment. A
number of development opportunities were provided via
the networks this year, including a Q&A with two of the firm’s
Partners, and a LinkedIn masterclass by our BD & Marketing
team. On top of these, frequent training sessions open to
all staff run throughout the year, with topics ranging from
spotlighting a service to educate staff, systems, and policies
training, to training on softer skills.
The Group has also expanded a mentoring scheme which
provides guidance and support to junior employees and
creates a positive working environment. The scheme has
several crucial benefits, not least developing skills and
knowledge and helping integrate mentees to the Group
culture and environment. Currently, there are over 40
pairings involving trainees to heads of department. The
HR department support mentors by providing mentoring
masterclass workshops, which provide them with the relevant
skills to have effective conversations with their mentees and
support their development within the firm.
Company culture
The Group has endeavoured to improve internal
communications this year, introducing some new initiatives
to encourage transparency on operations, but also to
educate staff. Monthly town hall group-wide calls have
been introduced on top of the existing quarterly in person
updates, with guest speakers from within the group each
month. In addition, staff have a direct forum to address
questions to the CEO through an anonymous #askjon email.
Staff were also surveyed in March 2023 on a range of topics,
with the findings being shared and addressed directly in the
quarterly updates. The firm has also introduced monthly
‘hub days’ in which office attendance is compulsory. Training
sessions and social activities are organised on these days.
The Group further encourages employee involvement in the
performance of the business through participation in share
ownership.
Throughout the year, regular social activities and staff drinks
are organised, both to support charity efforts and improve
the company culture – this year, activities have included pub
quizzes, a scavenger hunt, and a football match between
Rosenblatt and Memery Crystal.
34
Board of
Directors
35
Marianne Ismail
Non-Executive Chair
Jon Divers
Chief Executive Officer
Kevin McNair
Chief Financial Officer
Marianne Ismail has worked in financial services for over 30
years in a variety of small and large regulated entities. She
was a Managing Director of Morgan Stanley for 10 years
working in New York and internationally and has held senior
positions in Citigroup and Standard Chartered Bank. She
has a strong understanding of the management of growing
companies and of corporate risk. Marianne has held FCA
significant influence functions throughout her career. Until
July 2020, she was Pro Chancellor and Chair of the governing
body of the University of Greenwich and is currently a
Director and CEO of Microbira Ltd and a NED of Qatar
Islamic Bank - UK.
Jon Divers joined RBG Legal Services in February 2022 as
Chief Operating Officer and became CEO of RBG Holdings
in early 2023. Prior to this role in Professional Services, Jon
held a variety of senior management and Managing Director
roles in the transport and logistics sector. He has a strong
focus on organic revenue growth and margin through cost
control and believes all businesses have an opportunity for
improved efficiency. Jon’s background in industry has given
him a broad range of experience working with international
and time sensitive supply chains, union wage negotiations
and demanding clients. He believes that these commercial
skills transfer well into Professional Services as a sector that is
transforming and changing rapidly.
Kevin McNair joined RBG Holdings in June 2023, initially as
Interim Chief Financial Officer. He was appointed to the role
permanently in November 2023. Kevin has over 30 years’
experience in financial management and capital markets.
He has spent the past 20 years as CFO of various publicly
quoted and privately equity-backed businesses, primarily
in the professional services and industrial services sectors.
Kevin’s focus has been on transforming the performance
of people-based businesses and improving their financial
stability. He has worked closely with the institutional
investment and corporate banking communities in the UK
and across Europe for more than two decades.
David Wilkinson
Non-Executive Director
Patsy Baker
Non-Executive Director
Nick Davis
Executive Director
Tania MacLeod
Executive Director
David Wilkinson is an experienced Non-Executive
Chairman and Director, with a history of advising
fast-growth, entrepreneurial businesses and professional
practices. He is Audit Committee Chair at Marks Electrical
Group plc, an online domestic appliance retailer, which
floated on AIM in 2021. He chairs a private company,
CH Bailey, a formerly AIM-listed business in overseas
commercial and hospitality property, and he is a
Non-Executive Director of Verso Biosense, a medical
technology spinout from Southampton University.
Patsy Baker is as highly respected communications
professional. She continues as Senior Group Advisor to the
Accordience Group having stepped down as Chairman of
Citigate Dewe Rogerson last year. She provides corporate
affairs counsel to the Group’s international clients and oversees
the delivery and coordination of integrated communication
campaigns. She joined Lord Bell as a director at Bell Pottinger
Communications in 1994, has provided Senior Board
Counsel to CEOs in the UK FTSE 250, and has promoted and
protected the reputations of many well-known brands. Patsy
is an advisory board member of Invescore and also sits on the
external affairs committee of the Design Museum.
Nick Davis is a qualified lawyer with over 20 years of
experience in practice. Nick was CEO of Memery Crystal LLP
at the time of its acquisition by the Group in May 2021. Nick
joined Memery Crystal in 2000 and specialises in corporate
finance with expertise in IPOs, equity capital markets and
mergers & acquisitions. Nick sits on the AIM Advisory Group
of the London Stock Exchange, a group that provides input
and advises on matters affecting the operation and regulation
of AIM. Nick was previously a Non-Executive Director of AIM
Listed Shanta Gold Limited between 2012 and 2014, and a
Director of a subsidiary of The Supreme Cannabis Company
listed on the TSX.
Tania MacLeod is a qualified lawyer who trained at, and in
1997 became a partner in, Rosenblatt Solicitors. In 2018,
the business of Rosenblatt Solicitors was acquired by
Rosenblatt Limited, which was subsequently acquired by
Rosenblatt Group plc (now RBG Holdings plc) as part of
its IPO and admission to AIM. Tania will continue in a fee
earning capacity as Senior Partner of Rosenblatt and Head
of Dispute Resolution, titles which she retained upon her
appointment to the Group Board.
Corporate Governance 36
37
Corporate
Governance
statement
Overview
The Board recognises its responsibility towards good and
competent corporate governance.
The Board is aligned in promoting long-term growth for
the benefit of all of the Group’s stakeholders and as such
has adopted the Quoted Companies’ Alliance Corporate
Governance Code (“QCA Code”). The Board believes that
the QCA Code is appropriate to allow the Group to fulfil its
obligations to stakeholders.
The composition of the Board
Following the Board changes described in the Chair’s
Statement on pages 10 to 13, the Board comprises seven
directors, four Executives and three Non-Executives,
reflecting a blend of different experience and background.
All of the Non-Executives are considered independent.
Roles and responsibilities
Marianne Ismail, as Group Non-Executive Chair, assumes
responsibility for leading the Board and ensuring that the
Group’s corporate governance is appropriate and effective.
As Non-Executive Chairman, she is also responsible for
ensuring the Board agenda recognises financial and
operational matters to allow for effective delivery of the
Group strategy.
Jon Divers, as CEO is responsible for the day-to-day
operations of the Group and the Executive Directors have
the responsibility of delivering the Board strategy on a
day-to-day basis and reporting back on their progress.
Board meetings
The Board is scheduled to meet on a regular basis
throughout the year, with additional meetings called if
required. As a minimum the Board will meet six times a year.
A comprehensive board pack is distributed to all Directors
prior to each scheduled Board meeting, so that all Directors
can give due consideration to the matters in hand. The
Board’s main responsibilities are to agree and review Group
strategy, approve annual budgets, review management
performance, financial results, Board appointments and
dividend policy.
Attendance at scheduled board and committee meetings
during the year and since appointment is shown in the
table below.
Board
Audit
Committee
Remuneration
Committee
Number
Number
Number
J Divers
N Davis
T MacLeod
K McNair
I Rosenblatt
M Ismail
D Wilkinson
P Baker
K Hamill
S Drakeford-Lewis
N Foulston
17/17
15/16
16/16
2/2
7/7
17/17
14/15
9/15
3/5
6/6
0/1
3/3
n/a
n/a
1/1
n/a
3/3
3/3
3/3
2/2
2/2
n/a
4/4
n/a
n/a
n/a
n/a
4/4
4/4
4/4
3/3
3/3
n/a
On page 25, the s172 Statement sets out the key decisions
that the Board has made in the year.
Board committees
The Board has delegated specific responsibilities to the
Audit and Remuneration Committees. Each Committee
has terms of reference setting out its duties, authority and
reporting responsibilities. The terms of reference of each
Committee were put in place at the time of the Company’s
admission to AIM and are kept under review to ensure they
remain appropriate and reflect any changes in legislation,
regulation or best practice. Each committee comprises the
Non-Executive Directors and the Executive Directors attend
by invitation.
Each Committee has unrestricted access to employees of
the business or external advisors to meetings, to the extent
that they consider it necessary in relation to any specific
matter under consideration. During the year the Committees
have utilised external advice with the Remuneration
Committee liaising with Evelyn Partners for the purposes
of advising on the terms of the performance share awards
and benchmarking executive pay, and the Audit Committee
meeting with the Group’s external auditors, both with and
without the presence of Executive Directors and members of
the finance team.
Board effectiveness
The skills and experience of the Board are set out in their
biographical details on pages 34 to 35. The experience
and knowledge of each of the Directors gives them the
ability to constructively challenge strategy and scrutinise
performance. On joining the Board, new directors undergo
an induction programme tailored to the existing knowledge
and experience of the director concerned.
Time commitments
All Directors have been advised of the time required to fulfil
the role prior to appointment and were asked to confirm that
they could make the required commitment before they were
appointed, and this minimum requirement is included in their
letters of appointment.
Development
The Company Secretary ensures that all Directors are kept
abreast of changes in relevant legislation and regulations,
with the assistance of the Group’s advisers where appropriate.
Executive Directors are subject to the Group’s performance
review process through which their performance against
objectives is reviewed and their personal and professional
development needs considered.
Conflicts of interest
At each meeting, the Board considers Directors’ conflicts
of interest. The Company’s Articles of Association (Articles)
provide for the Board to authorise any actual or potential
conflicts of interest.
Directors’ and Officers’ liability insurance
The Company has purchased Directors’ and Officers’ liability
insurance as allowed by the Company’s Articles.
Risk management and internal controls
The Board is responsible for maintaining a sound system of
internal controls to safeguard shareholders’ investments and
the Company’s assets. Such a system is designed to manage
rather than eliminate the risk of failure to achieve business
objectives and can provide only reasonable and not absolute
assurance against material misstatement or loss. The Board
has considered the need for an internal audit function but
has concluded that the internal control system in place is
appropriate for the size and complexity of the Group. The
Board is also responsible for the identification and evaluation
of major risks faced by the Group and for determining the
appropriate course of action to manage those risks.
Relations with stakeholders
The Board is aware that the long-term success of the Group
is reliant upon its employees, clients, shareholders, suppliers
and regulators and as such the Group maintains consistent
communication with these stakeholders to ensure that its
continued growth in accordance with its strategy reflects their
needs and expectations as well as those of the Group.
The Group endeavours to ensure that clients are met regularly
to canvas their opinion on the service levels received and
provide any feedback as to how these relationships and/or
services can be improved. The Group has a strong track-
record of retaining deep client relationships with some of
these relationships being in excess of 25 years across a
number of service lines provided within the Group’s business.
The Executive Directors meet with the institutional
shareholders both on an ad hoc basis and on a more
structured basis around the publication of the Group’s interim
and end of year results. General information about the Group
is available on the website at www.rbgholdings.co.uk.
Corporate Governance
38
39
Audit
Committee
report
Members of the Audit Committee
Audit process
The auditor prepares an annual planning report for
consideration by the committee, which details areas of
audit focus and anticipated key audit risks, together with
the anticipated level of materiality. The auditor presents this
to the committee, and it is reviewed and approved by the
committee. Following the external audit process, the auditor
presented its findings to the Committee for discussion. A
number of areas were reviewed around revenue recognition,
going concern, valuation and cut-off of contract assets,
recoverability of trade receivables, valuation of provisions
for legal disputes, valuation and impairment of goodwill and
other intangible assets, valuation of litigation assets and gain/
loss on disposal of litigation assets, changes to accounting
policies, disposal of LionFish Litigation Finance Limited
and accounting estimates. These areas were identified by
the external auditors during the year and it was agreed
that management’s treatment and representation were in
compliance with accounting standards.
Risk management and internal controls
The Board has established a framework of risk management
and internal control systems, policies and procedures. The
committee is responsible for reviewing the risk management
and internal control framework, ensuring that it operates
effectively. The committee is satisfied that the internal
controls currently in place are sufficient and operating
effectively for a business of this size.
At present the Group does not have an internal audit
function and the committee believes that in view of the
current size and nature of the Group’s business, management
is able to derive sufficient assurance as to the adequacy and
effectiveness of the internal controls and risk management
procedures without a formal internal audit function. This will
be kept under review as the business evolves.
David Wilkinson
Chair of the Audit Committee
30 April 2024
The Audit Committee is chaired by David Wilkinson, and its
other members are Marianne Ismail and Patsy Baker. The
Group Chief Financial Officer, other Executive Directors and
external auditors are permitted to attend meetings of the
committee by invitation.
The Audit Committee has primary responsibility for
monitoring the quality of internal controls and ensuring that
the financial performance of the Group is properly measured
and reported on. It receives and reviews reports from the
Group’s management and auditors relating to the interim and
annual accounts and accounting and internal control systems
in use throughout the Group.
The Audit Committee meets at least three times a year
and has unrestricted access to the Group’s Auditors. The
committee meets annually with the external auditors,
without Executive Directors being present, to discuss any
issues arising from their audit work. Neither the Group nor
the Directors have any relationships that impair the external
auditor’s independence.
Duties
During the year the Audit Committee discharged its
responsibilities by:
• approving the external auditor’s plan for the audit of the
Group’s annual financial statements, including key audit
matters, key risks, confirmation of auditor independence,
terms of engagement and audit fees
• reviewing the Group’s draft annual report and
accounts and the external auditor’s detailed audit
completion report including consideration of key
audit matters and risks
• reviewing the Group’s half year and full year results
announcements
• considered the appropriateness of disclosures in the
annual financial statements regarding Alternative
Performance Measures (“APMs”)
• Moore Kingston Smith LLP (“MKS”) were re-appointed
as external auditor in 2023
Role of the external auditor
The Committee monitors the relationship with the external
auditor, considering their performance in discharging the
audit, the scope of the audit and terms of engagement,
their independence and objectivity and remuneration. Any
instruction for the external auditor to provide non-audit
services to the Group must be approved in advance by
the committee. A breakdown of the fees charged by MKS
analysed between audit and non-audit services is provided
in Note 9 to the accounts.
The committee has confirmed that it is satisfied with the
independence, objectivity and effectiveness of MKS and
has recommended to the Board that the auditors be
reappointed. There will be a resolution to reappoint the
auditors at the forthcoming AGM.
David Wilkinson
Chair of the Audit Committee
Corporate Governance 40
41
Patsy Baker
Chair of the
Remuneration
Committee
This report sets out how the Committee operates and summarises the
remuneration policy. Details of the remuneration paid to the Directors
for the year is set out in the Directors’ report on pages 42 to 45.
Members of the Remuneration Committee
Directors’ remuneration
The Remuneration Committee is appointed by the Board
and is formed entirely of Non-Executive Directors. The
Committee is chaired by Patsy Baker, its other members are
Marianne Ismail and David Wilkinson. Executive Directors
attend meetings by invitation, but no Director is present
when his or her remuneration is discussed.
The Remuneration Committee is responsible for setting
the Group’s general policy on remuneration and approving
matters relating to the remuneration and terms of
employment of the Executive Directors and key senior
employees. The Committee also makes recommendations
to the Board on proposals for the granting of share options
and other equity incentives pursuant to any share option
scheme or equity incentive scheme in operation from time to
time. The Committee is responsible for recommending the
structure for Non-Executive Director pay, which is subject to
approval of the Board.
The Committee meets formally at least three times
a year and receives internal advice from Executive
Directors and external advice from remuneration
consultants where necessary. In exercising its role,
the Committee has regard to the QCA Remuneration
Committee Guide and associated guidance.
Policy
The remuneration policy of the Group is driven by our
approach to align the best interests of shareholders and
management. The committee looks to set remuneration
for Executive Directors and key senior employees at
appropriate market levels, with reference to their roles and
responsibilities. Incentive arrangements which provide
appropriate reward are implemented and measured against
key performance criteria designed to deliver the Group’s
objectives and strategy and are reviewed annually.
Duties
During the year, the Remuneration Committee undertook
the following activities:
• determining salary increases and incentive outcomes
for the Executive Directors and key senior employees
• approving overall salary increases and incentive
outcomes for the Group
• reviewing and approving harmonised bonus and
long-term incentive plans across the Group
The remuneration arrangements for Executive Directors
consist of a basic salary together with a performance
bonus. In addition, they receive private medical insurance.
Performance related pay is not guaranteed or contractual
and is based on performance targets surrounding the Group,
with criteria set on an annual basis by the Remuneration
Committee. The bonus payable in the year is disclosed in
the table of Directors’ emoluments in the Directors’ report
on pages 42 to 45.
Long-term incentive plans are in place to seek to incentivise
the Executive Directors to enhance shareholder value
through growing the Group’s share price. Details of awards
issued under the plans are disclosed in the Directors’ report
on pages 42 to 45.
Executive Directors enter into service agreements, which may
be terminated by either party by giving written notice of not
less than twelve months. The service agreements contain
provisions for early termination in the event of a breach of
a material term of the service agreement by the Executive
Director or where the Executive Director ceases to be a
Director of the Company for any reason.
Non-Executive Directors
Non-Executive Directors’ remuneration is determined
by the Board. The Chairman of the Board and the other
Non-Executive Directors receive an annual fee for their
services, reflective of their level of responsibility, relevant
experience and specialist knowledge and are reimbursed for
appropriate travel expenses to and from Board meetings.
The Non-Executive Directors serve under letters of
appointment, which may be terminated by either party giving
three months’ written notice. The Non-Executive Directors
are typically expected to serve two-year terms but may be
invited by the Board to serve for an additional period.
Patsy Baker
Chair of the Remuneration Committee
30 April 2024
Our Corporate Governance page can be found at https://www.rbgholdings.co.uk/about/corporate-governance/.
All enquiries sent via “Contact Us” on the website or via email info@rbgholdings.co.uk will be forwarded to an
appropriate member of our team and will be dealt with promptly.
Remuneration
Committee
report
Corporate Governance 42
Directors’ Report
The Directors’ interests in the shares of the Company as at 31 December 2023 are set out below:
43
0.2p Ordinary Shares
0.2p Ordinary Shares
2023
2023
2022
2022
0.2p Ordinary Shares
Directors’ remuneration payable in the year is set out below:
The directors present their report and the audited financial
statements of the Group for the year ended 31 December 2023.
Principal activities and business review
Substantial shareholdings
The principal activities of the Group during the year were
the provision of professional services. The results for the
year and the financial position of the Group are as shown in
the annexed financial statements. A review of the business
and its future development is given in the Chair’s and Chief
Executive Officer’s statements.
Results and dividends
The results for the year are set out in the consolidated
statement of comprehensive income on page 58.
As announced in July 2023, following feedback from
significant shareholders, the Group’s priority is to reduce
debt and as a result suspended its dividend policy for
the foreseeable future.
Future developments
Our priorities for the following financial year are disclosed in
the Chief Executive Officer’s statement on pages 14 to 16.
The Company was notified that the following were interested
in 3% or more of the issued ordinary share capital at 31
December 2023:
Ian Rosenblatt
Premier Miton Investors
Dowgate Wealth Limited
Interactive Investor
Hargreaves Lansdown
Asset Management
AJ Bell Securities
Charles Stanley
Interactive Brokers
Stonehage Fleming
Family & Partners
Number
16,966,464
11,922,021
7,707,360
7,647,620
7,409,365
4,390,521
3,789,880
3,251,000
2,865,588
% of issued
share capital
17.80%
12.51%
8.08%
8.02%
7.77%
4.61%
3.98%
3.41%
3.01%
Directors and their interests
The directors who served throughout the year, except
where otherwise stated and in place at the date of this
report are as follows:
Marianne Ismail
Patsy Baker
David Wilkinson
Jon Divers
Kevin McNair
Ian Rosenblatt OBE
Tania MacLeod
Nick Davis
N Foulston
Keith Hamill
Suzanne
Drakeford-Lewis
Non-Executive Chair
Non-Executive Director
Non-Executive Director
Chief Executive Officer
(appointed 3 March 2023)
Chief Financial Officer
(appointed 28 November 2023)
Executive Vice Chair
(appointed 27 July 2023,
resigned 28 March 2024)
Executive Director
(appointed 3 March 2023)
Executive Director
(appointed 3 March 2023)
(Terminated 31 January 2023)
Non-Executive Chairman
(resigned 22 June 2023)
Group Finance Director
(resigned 30 June 2023)
-
-
-
-
-
12.0%
0.1%
0.0%
12.1%
Total
£
85,000
40,000
40,000
301,928
306,902
2,258,834
385,093
21,771
45,000
131,325
37,152
3,653,005
Total
£
-
445,487
90,000
40,000
15
635,000
37,737
37,737
% of issued
share capital
Number
% of issued
share capital
12
I Rosenblatt
12
T MacLeod
12
N Davis
J Divers
12
M Ismail
Cascades Ltd*
N Foulston
S Drakeford-Lewis
13
Number
16,966,464
1,305,044
1,100,674
100,529
100,000
-
-
-
17.8%
1.4%
1.2%
0.1%
0.1%
-
-
-
-
-
-
-
-
11,410,000
105,264
4,112
*A company wholly owned by the Foulston Family Trust of which Nicola Foulston is a beneficiary.
19,572,711
20.5%
11,519,376
Dividends of £12,028 were paid on these shares during the year in relation to 2022 results (2022: £575,763).
Directors’ remuneration
31 December 2023
M Ismail
P Baker
D Wilkinson
N Davis (appointed 3 Mar 2023)
T MacLeod (appointed 3 Mar 2023)
I Rosenblatt (appointed 27 Jul 2023)
J Divers (appointed 3 Mar 2023)
K McNair (appointed 28 Nov 23)
K Hamill (resigned 22 Jun 2023)
S Drakeford-Lewis (resigned 30 Jun 2023)
N Foulston (terminated 31 Jan 2023)
Basic Salary and/or
Directors Fees
Employer Pension
Contributions
£
85,000
40,000
40,000
288,845
298,254
**
2,258,834
372,593
20,833
45,000
127,500
37,152
3,614,011
£
-
-
-
13,083
8,648
-
12,500
938
-
3,825
-
38,994
** Of this amount, £600,000 remained payable as at 31 December. Ian Rosenblatt subsequently agreed to receive this amount in shares as part of the equity that was announced in February 2024.
31 December 2022
S Drakeford-Lewis
14
N Foulston (terminated 31 Jan 2023)
K Hamill
M Ismail
R Parker (resigned 31 Dec 2022)
P Baker
D Wilkinson
Basic Salary and/or
Directors Fees
Employer Pension
Contributions
£
-
445,820
90,000
40,000
611,000
37,737
37,737
£
-
(333)
-
-
24,000
-
-
1,262,294
23,667
1,285,961
12 Appointed during the year ended 31 December 2023.
13 No dividends disclosed as S Drakeford-Lewis was appointed on 31 December 2022.
14 No remuneration disclosed as S Drakeford-Lewis was appointed on 31 December 2022.
15 £292,500 of the total related to termination payment.
Corporate Governance
44
45
The directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the Company’s transactions and disclose with reasonable
accuracy at any time the financial position of the Company
and enable them to ensure that the financial statements
comply with the requirements of the Companies Act 2006.
They are also responsible for safeguarding the assets of the
Company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
The directors are responsible for ensuring the annual report
and the financial statements are made available on a website.
Financial statements are published on the Company’s
website in accordance with legislation in the United
Kingdom governing the preparation and dissemination
of financial statements, which may vary from legislation in
other jurisdictions. The maintenance and integrity of the
Company’s website is the responsibility of the Directors. The
Directors’ responsibility also extends to the ongoing integrity
of the financial statements contained therein.
The Company has made qualifying third-party indemnity
provisions for the benefit of its directors which were made
during the year and remain in force at the date of this report.
Auditor
A resolution to reappoint Moore Kingston Smith LLP as
auditor for the ensuing year will be proposed at the Annual
General Meeting in accordance with Section 489 of the
Companies Act 2006.
Disclosure of information to auditor
The Directors confirm that, as far as they are each aware,
there is no relevant audit information of which the Group’s
auditors are unaware; and each director has taken all the
steps that they ought to have taken as a director to make
themselves aware of any relevant audit information and
to establish that the Group’s auditors are aware of that
information.
On behalf of the Board
Jon Divers
Chief Executive Officer
30 April 2024
Directors who have an interest in the shares of the Company
will benefit through dividend payments. During the year
the following bonuses were received by directors and are
included within Basic Salary and/or Directors’ Fees.
31 Dec 2023
16
31 Dec 2022
J Divers
N Davis
S Drakeford-Lewis
R Parker
£
122,593
17,178
25,000
-
£
-
-
-
50,000
No awards were granted in the year under the Group’s
Executive Incentive Plan (“EIP”). The Directors have not been
granted any other share options or benefitted from other
long-term incentive arrangements during the year.
Engagement with employees and stakeholders
The Group operates an equal opportunities employment
policy. The Group’s policy on recruitment, development,
training and promotion includes provision to give full and
fair consideration to disabled persons, having particular
regard to their aptitudes and abilities. The Group appreciates
and values the input of all its employees and encourages
development and training to enhance employee skills. The
Group ensures that employees are aware of any important
matters that may impact on the performance of the Group.
Details of how the Directors have engaged with and had
regard to employees is addressed in the s172 report on
page 25.
The directors have regard to the need to foster the
company’s business relationships with suppliers, customers
and others and the impact on principal decisions in the year
is also addressed in the s172 report.
Going concern
As described in the Strategic Report on pages 18 to 32
the Group expects to be able to operate within the Group’s
financing facilities and in accordance with the covenants
set out in all available facility agreements. Accordingly, the
Directors have a reasonable expectation that the Company
and the Group have adequate resources to continue in
operational existence for the foreseeable future and they
have adopted the going concern basis of accounting in
preparing the annual Group financial statements.
Financial risk management
Financial risk is managed by the Board on an ongoing basis.
The key financial risks relating to the Group are outlined
in more detail in Note 4 to the consolidated financial
statements. The Group’s principal risks and uncertainties are
outlined in the Strategic report.
Post balance sheet events
• On 22 February 2024, the Group raised £0.9 million
before expenses through the issue of new ordinary
shares. A further £2.1 million before expenses was
raised through the issue of new ordinary shares on 12
March 2024. The fundraising, which took place at a
tight discount to the prevailing share price, was strongly
supported by existing institutional shareholders, including
certain directors who subscribed for £1.0 million of shares
as part of the fundraise. The purpose of the raise was to
provide additional working capital to the Group and to
reduce the use of the Group’s banking facilities.
• On 28 March 2024, the Group completed the
disposal of Convex Capital to a joint venture led by its
management team. Under the terms of the agreement,
the Group received initial consideration of £2.0 million
with up to another £600,000 payable on completion
of certain subsequent transactions. Following the
disposal, the Group is focused purely on legal
services, its core business.
• Following the completion of the disposal of Convex,
Ian Rosenblatt stepped down from the Board. Ian
remains the Group’s largest shareholder and largest
revenue earner.
Annual General Meeting
The provisional date for the Company’s AGM is 19 June 2024.
Political donations
No political donations were made during either 2023 or 2022.
Directors’ responsibilities statement
The directors are responsible for preparing the Strategic
report, Directors’ report and the financial statements in
accordance with applicable law and regulations. Company
law requires the Directors to prepare financial statements for
each financial year.
Under that law the directors have elected to prepare the
Group and Company financial statements in accordance
with UK adopted International Accounting Standards. Under
company law the Directors must not approve the financial
statements unless they are satisfied that they give a true and
fair view of the state of affairs of the Group and Company
and of the profit or loss of the Group for that year.
The directors are also required to prepare financial
statements in accordance with the rules of the London Stock
Exchange for companies trading securities on AIM.
In preparing these financial statements, the directors are
required to:
• select suitable accounting policies and then apply them
consistently;
• make judgements and accounting estimates that are
reasonable and prudent;
• state whether they have been prepared in accordance
with UK adopted International Accounting Standards,
subject to any material departures disclosed and
explained in the financial statements;
• prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the
company will continue in business.
16 Bonuses paid during the year ended 31 December 2023 relate to 31 December 2022 results.
Jon Divers
Chief Executive Officer
Corporate Governance 46
47
Corporate Governance 48
Independent Auditor’s Report to
the members of RBG Holdings plc
We have determined the matters described below to be the key audit matters to be communicated in our audit report.
49
Key Audit Matters
How our scope addressed this matter
Opinion
We have audited the financial statements of RBG Holdings Plc (the ‘Parent Company’ and its subsidiaries (the ‘Group’)) for the
year ended 31 December 2023 which comprise the Consolidated statement of comprehensive income, the Consolidated and
Company statements of financial position, the Consolidated and Company Statements of cash flows, the Consolidated and
Company statements of changes in equity and notes to the financial statements, including significant accounting policies. The
financial reporting framework that has been applied in the preparation of the Group and Parent Company financial statements is
applicable law and UK adopted International Accounting Standards and as regards the Parent Company financial statements, as
applied in accordance with the provisions of the Companies Act 2006.
In our opinion:
• the financial statements give a true and fair view of the Group’s and of the Parent Company’s affairs as at 31 December 2023
and of the Group’s loss for the year then ended;
• the Group financial statements have been properly prepared in accordance with UK adopted International Accounting Standards;
• the Parent Company financial statements have been properly prepared in accordance with UK adopted International
Accounting Standards and as applied in accordance with the provisions of the Companies Act 2006; and
• the financial statements have been prepared in accordance with the requirements of the 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 Group 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 as applied to listed entities, 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.
An overview of the scope of our audit
Our Group audit was scoped by obtaining an understanding of the Group and its environment, including the Group’s system
of internal control, and assessing the risks of material misstatement in the financial statements. We also addressed the risk of
management override of internal controls, including assessing whether there was evidence of bias by the Directors that may have
represented a risk of material misstatement.
The components of the Group were evaluated by the Group audit team based on a measure of materiality, considering each
component as a percentage of the Group’s net assets, gross revenue, adjusted earnings before interest, tax, depreciation and
amortisation (adjusted EBITDA) and results before tax, which allowed the Group audit team to assess the significance of each
component and determine the planned audit response. The Group is made up of the Parent Company and four subsidiaries as at 31
December 2023, RBG Legal Services Limited, Convex Capital Limited, RBL Law Limited and Convex Group (Holdings) Limited. We
considered the Parent Company and RBG Legal Services Limited to represent the two significant components of the group which
were subject to full scope audits performed by the group audit engagement team. As RBL Law Limited, Convex Capital Limited
and Convex Group (Holdings) Limited were not considered to be significant components we performed limited audit procedures on
key balances and classes of transactions to cover specific identified risks. Lionfish Litigation Finance Limited was disposed of during
2023 and therefore our audit procedures focused on key balances and classes of transactions up to the date of disposal.
For significant components requiring a full scope audit approach, we evaluated controls by performing walkthroughs and test
of controls over the financial reporting systems identified as part of our risk assessment, reviewed the accounts production
process, and addressed critical accounting matters. We then undertook substantive testing on significant transactions and
material account balances.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to
fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the
audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the financial statements, and in forming our opinion thereon, and
we do not provide a separate opinion on these matters. This is not a complete list of all risks identified by our audit.
Revenue recognition,
specifically valuation of
contract assets
Refer to the accounting policies in Note
2 on page 67 in the Group financial
statements.
Revenue from legal services and other
professional services is recognised
based on reference to time charged at
agreed rates.
As at the reporting date, there can
be instances when the Company
has provided services to customers
for which not all the performance
obligations have been satisfied as at
the reporting date.
Estimation and recognition of the
amount of performance obligations
which have been met at the reporting
date and recoverability of the amounts
involved is a matter of judgment and
we therefore considered it a significant
area of focus for the audit and a key
audit matter.
Our audit work included, but was not restricted to, the following
procedures:
We evaluated the operating effectiveness of certain key controls
identified in relation to revenue.
We evaluated the Group’s accounting policy in respect of revenue
recognition to ensure it is compliant with IFRS 15.
We selected a sample of revenue items on which to perform tests of
detail and the substantive testing and controls-based testing procedures
performed in respect of revenue included the following:
• Confirming revenue was recognised in accordance with the terms
and conditions entered into with customers.
• Agreeing a sample of fee earner timesheet entries recorded in the
time recording system to the physical fee note (sales invoice), the
entries to the accounting system, and the cash received.
• Agreeing the hourly rates per timesheets for selected matters to
the group’s agreed charge out rate listing to test the accuracy of
recorded time.
• Performing controls-based testing for a sample of selected matters
and agreeing these to the letters of engagement, the signed
physical fee notes (sales invoices) and the approval of entries to the
accounting system.
• Performing cut-off testing on either side of the reporting date.
• Reviewing material credit notes and invoices raised after the
reporting date.
• Analytically reviewing fee income to assess whether there were any
unusual trends.
• Reviewing material journals posted to revenue.
• Selecting samples of contract assets and agreeing them to fee
notes (sales invoices) raised subsequent to the reporting date and
subsequent remittance. Where fee notes (sales invoices) were
unavailable, obtaining alternative supporting evidence to gain
assurance over recoverability.
• Comparing the valuation of contract assets at the reporting date
to historic recovery rates for the legal department to which the
matters relate.
• Critically assessing management’s assumptions used in arriving at
the final valuation for contract assets to gain assurance that there
was no management bias.
Key observations:
As a result of our critical assessment of management’s assumptions
used in arriving at the final valuation for contract assets, we identified
some material misstatements in revenue recognition and consequently
some material adjustments were made to the carrying values of contract
assets. Based on the procedures performed and with the adjustments
referred to above having been made, we consider that the assumptions
made by management in recognising revenue on part completed
contracts with customers at the reporting date to be appropriate and in
accordance with the requirements of IFRS 15.
Corporate Governance 50
51
Key Audit Matters
How our scope addressed this matter
Key Audit Matters
How our scope addressed this matter
Recoverability of
Trade Receivables
Refer to the accounting policies in
Note 2 on page 69 in the Group
financial statements.
There can be instances where the
Company has invoiced their customers
for legal services provided within the
financial year, but fee notes (sales
invoices) remain unpaid until after the
reporting date.
Estimation and recognition of the
recoverable amount at the reporting
date for these items is a matter of
judgment. In addition, the Company
changed its approach in arriving at
the accounting estimate in respect
of the provision for impairment of
trade receivables, and we therefore
considered it a significant area of focus
for the audit and a key audit matter.
Our audit work included, but was not restricted to, the following
procedures:
Evaluating the Group’s accounting policies in respect of revenue
recognition and provision for expected credit losses to ensure they
are compliant with IFRS 15 and IFRS 9 respectively.
Selecting samples of trade receivables and agreeing them to receipts
subsequent to the reporting date. Where receipts were unavailable,
obtaining alternative supporting evidence to gain assurance over
recoverability.
Assessing the overall recoverability of trade receivables by reviewing
the proportion of total trade receivables at the reporting date that had
been recovered by the date of signing the auditor’s report including
checking the consistency of total recoverability within similar timeframes
for previous accounting periods.
Enquiring with management about the amended approach adopted
giving rise to the change in accounting estimate during the year in
respect of the provision for expected credit losses on trade receivables.
Critically assessing management’s revised assumptions and the
justifications used in arriving at the final provision for expected credit
losses on trade receivables to gain assurance this did not constitute
management override.
Analysing the reliability of the change in accounting estimate by
performing sensitivity analysis on historical results in respect of the
recoverability of trade receivables.
Assessing whether the change in accounting estimate in respect of
the provision for expected credit losses was applied in accordance with
IFRS 9 and IAS 8.
Key observations:
As a result of our critical assessment of management’s assumptions
used in arriving at the final valuation of trade receivables, we identified
some material misstatements in revenue recognition and consequently
some material adjustments were made to the carrying values of
trade receivables.
Based on the procedures performed and with the adjustments
referred to above having been made, we consider that the
assumptions made by management in arriving at the provision for
expected credit losses on trade receivables at the reporting date to
be appropriate and in accordance with the requirements of IFRS 9.
As referenced in Note 3 of the Group’s financial statements, expected
credit losses are now recognised based on the ageing of fee notes
(sales invoices) with invoices over 270 days being fully provided for.
Management also makes an assessment for invoices under 270 days
old to determine their recoverability.
Valuation of litigation assets
and gain/loss on disposal of
litigation assets (litigation
assets hived up from LionFish
Litigation Finance Limited)
The Group enters into contracts under
which it provides funding to litigants.
Litigation assets are measured at fair
value as described in the accounting
policy on page 69.
The Group is entitled to a fixed
return that is contingent on the
successful outcome of the case which
in turn is dependent upon the timing
of the settlement of the case. It has
also entered into contracts under which
a share in any damages to which the
Group is entitled are disposed of to
a third-party.
The calculation of the results on
disposal and the fair value of the
remaining investments requires
significant estimation and judgement
and we therefore considered it a
significant area of focus for the audit
and a key audit matter. Specifically:
• Estimation of the likely date of
settlement impacts the expected
returns to be receivable and the
fair value of the remaining
investments; and
• Estimation of the total funding
that will be drawn down under each
contract impacts the cost of sales
for the gain on sale of investments.
Our audit work included, but was not restricted to, the following
procedures:
We evaluated the Group’s accounting policy in respect of the litigation
assets to ensure it is compliant with IFRS 9.
• We agreed sale proceeds on the disposal of LionFish Litigation
Finance Limited to the bank statements and share purchase
agreement.
• We tested the arithmetical accuracy of the calculations through
recalculation of the costs, fair value, and profit on disposal.
• We agreed the drawdown of litigation funds during the year to the
bank statements.
• We critically assessed and challenged management’s assumptions
adopted to calculate the amounts written off to the profit and loss
account upon disposal of litigation assets and liabilities from the
balance sheet during the year.
Key observations:
The three litigation assets that were not sold as part of the LionFish
Litigation Finance Limited disposal were hived up into RBG Holdings
Plc, These assets were hived up at cost amounting to £1.78m and
subsequently impaired to £Nil. We have reviewed management’s
assessment of the amount impaired and considered this to be
appropriate, as the three litigation cases were lost during the year
and therefore held no remaining value.
Based on our audit work, we concluded that the disposal of
LionFish Litigation Finance Limited was not materially misstated
in the financial statements.
Corporate Governance 52
53
Key Audit Matters
How our scope addressed this matter
Key Audit Matters
How our scope addressed this matter
Treatment of damages based
agreements, including the
provision of legal services
A prior period adjustment has been
made in the comparative financial
information presented in the financial
statements, on the basis that an
incorrect accounting policy previously
adopted in respect of the treatment
of damages based agreements. As
described in the accounting policy
on page 73, the Group enters into
composite contracts of providing
both legal services and funding to its
litigation customers. In return for these
services the Group receives a share in
any damages awarded.
Estimation and recognition of the
amount of performance obligations
which have been met at the reporting
date and recoverability of the amounts
involved is a matter of judgment and
we therefore considered it a significant
area of focus for the audit and a key
audit matter.
Our audit work included, but was not restricted to, the following
procedures.
• Critically assessing the reasonableness of key assumptions, such as
estimated damages-based awards, by corroborating the underlying
documents through discussion with the Lead Partner for each matter
and considering the outcomes of similar historic cases.
• Challenging the key assumptions used by management in the
reassessment of the first case including the change in success rates
through discussions with the Lead Partner.
• Critically assessing the management reassessment of recoverability
of trade receivables under the second case of the damages based
agreements.
Key observations:
From our work performed, we agreed with management’s
assessment that a prior period adjustment was required in respect
of incorrect accounting policies previously adopted for damages
based agreements.
From our assessment and challenge of management and the Lead
Partner of each damages based agreement:
• The reassessment is based on both the timeline of legal
proceedings and merits of the first case which led to management’s
judgement that the chance of success significantly reduced
from 90% to 50% in February 2022. We concluded that this was
appropriate.
• We concluded that management’s judgement regarding the IFRS
9 Expected Credit loss full provision on the second case at each
respective year end was not materially misstated.
Based on our audit work, we concluded that the quantum of the prior
period adjustment was purely due to the reassessment performed
and described above and not the incorrect application of accounting
policies in the prior period.
Annual impairment review of
goodwill and other intangible
assets
Refer to the accounting policies in
Note 2 on page 68 and Note 3 on
page 74 for key judgements in the
Group financial statements.
As at the reporting date the group
had intangible assets for continuing
operations of £40.49m (2022 restated:
£ 38.69 m) including goodwill of
£36.09m (2022 restated: £36.09m).
The process for assessing whether an
impairment exists under International
Accounting Standard IAS 36
‘Impairment of Assets’ is complex.
The process of determining the value
in use, through forecasting cash flows
(primarily revenue less costs) and the
determination of the appropriate
discount rate and other assumptions to
be applied, is highly judgemental and
can significantly impact the results of
the impairment review.
Based on the judgemental nature
of an impairment review, we therefore
identified valuation of goodwill and
other intangible assets as a key
audit matter.
Our audit work included, but was not restricted to, the following
procedures:
• Obtaining management’s assessment of the Group cash generating
units (CGUs) and critically assessing the Value In Use (VIU) model
for each CGU to test compliance with the requirements of the
applicable accounting standards, specifically IAS 36, and the
mathematical accuracy of the model.
• Critically assessing and challenging the impairment model prepared
by management in terms of the inputs including recalculating the
weighted average cost of capital (WACC).
• Performing sensitivity analysis on the impairment model and
assessing the accuracy of the forecasts used based on historical
trading performance for each CGU.
• Evaluating the accounting policy and detailed disclosures in
the notes to the financial statements to determine whether
information provided in the financial statements is compliant with
the requirements of IAS 36 and consistent with the results of the
impairment review.
• Reviewing the amortisation accounting policy for intangible fixed
assets to ensure it was appropriate.
• Substantively auditing additions to intangible assets ensuring that
they are in accordance with IAS 38 in respect of criteria
for capitalisation.
Key observations:
Based on our audit work, we concluded that goodwill and other
intangible assets are not materially misstated at the reporting
date and that management’s assessment that no impairment was
required was appropriate.
Corporate Governance 54
Our application of materiality
The scope and focus of our audit were influenced by our assessment and application of materiality. We define materiality as
the magnitude of misstatement that could reasonably be expected to influence the economic decisions of the users of financial
statements. We use materiality to determine the scope of our audit and the nature, timing, and extent of our audit procedures
and to evaluate the effect of misstatements, both individually and on the financial statements as a whole. We apply the concept
of materiality both in planning and performing our audit, and in evaluating the effect of misstatements.
Based on our professional judgment we determined materiality for the 2023 financial statements as a whole and performance
materiality as follows:
Group financial
statements
Parent company
financial statements
Materiality
£232,000
£231,999
Basis for
determining
materiality
Rationale for
the benchmark
applied
Performance
materiality
Basis for
determining
performance
materiality
5% of Adjusted EBITDA
The Group has reiterated its continued focus
on growth and increasing revenue and profit
margins during 2023. As such, the Group
continues to be a profit orientated business
and Adjusted EBITDA is considered to be the
key financial metric on which the users of the
financial statements are likely to focus on.
Based on an allocated
proportion of Group materiality
using 2% of Gross Assets
capped at Group Materiality.
As for group materiality.
£116,000
£115,999
50% of Group financial statement materiality.
This was considered an appropriate percentage
based on our risk assessment and our
assessment of the overall control environment of
the group.
50% of Parent company
financial statement materiality.
We set materiality for each component of the Group based on a percentage of Group materiality dependent on the size of
each component and our assessment of the risk of material misstatement relevant to that component. Both parent company
materiality and component materiality, was capped at Group materiality and as such was £231,999. In the audit of each
component, we further applied performance materiality levels of 50% of total component materiality to our testing to ensure
that the risk of errors exceeding component materiality was appropriately mitigated.
We agreed with the Audit Committee that we would report to them all individual audit differences in excess of £11,600 for the
Group and £11,599 for the Parent Company and each component. We also agreed to report differences below this threshold
that, in our view, warranted reporting on qualitative grounds. We also reported to the Audit Committee on disclosure matters
that we identified when assessing the overall presentation of the financial statements.
55
Conclusions related 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. Our evaluation of the Directors’ assessment of the Group and Parent
Company’s ability to continue to adopt the going concern basis of accounting included the following procedures:
• Critically assessing the going concern assessment prepared by management covering at least twelve months from the date
of the audit report;
• Performing sensitivity analysis on the forecasts to ensure there is sufficient cash flow headroom for the group to continue as
a going concern for at least that period;
• Reviewing the trading performance of the group post year end and comparing it to the forecasts to assess their accuracy; and
• Assessing the adequacy of the going concern disclosures in the financial statements.
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 Group and the Parent 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 other information comprises the information included in the annual report, other than the financial statements and our
auditor’s report thereon. The Directors are responsible for the other information contained within the annual report. 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.
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 course of 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 themselves. 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
• the information given in the Strategic Report and the Directors’ Report for the financial year for which the financial
statements are prepared is consistent with the financial statements; and
• the Strategic Report and the Directors’ Report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Group and the Parent Company and their environment obtained in the
course of the audit, we have not identified material misstatements in the Strategic Report or the Directors’ Report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in
our opinion:
• adequate accounting records have not been kept by the Parent Company, or returns adequate for our audit have not been
received from branches not visited by us; or
• the Parent Company financial statements are not in agreement with the accounting records and returns; or
• certain disclosures of directors’ 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 set out on pages 44-45, 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 Group’s and the Parent 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 Group or the Parent Company or to cease operations, or have no
realistic alternative but to do so.
Corporate Governance Financial
Statements
Contents
Financial Statements
Independent auditor’s report to the
members of RBG Holdings plc
Consolidated statement of comprehensive income
Consolidated statement of financial position
Consolidated statement of cash flows
Consolidated statement of changes in equity
Company statement of financial position
Company statement of cash flows
Company statement of changes in equity
Notes to the Consolidated and Company
financial statements
48
58
59
60
61
62
63
64
65
56
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 aggregate, they could reasonably be expected to influence the economic decisions of users
taken on the basis of these financial statements.
A further description of our responsibilities is available on the FRC’s website at https://wwww.frc.org.uk/auditors/auditor-
assurance/auditor-s-responsibilities-for-the-audit-of-the-fi/description-of-the-auditor’s-responsibilities-for
This description forms part of our auditor’s report.
Explanation as to what extent the audit was considered capable of detecting irregularities,
including fraud
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 procedures are capable of detecting irregularities, including fraud is detailed below.
The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial
statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement
due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately
to instances of fraud or suspected fraud identified during the audit.
However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged
with governance of the company.
Our approach was as follows:
• We obtained an understanding of the legal and regulatory requirements applicable to the company and considered that
the most significant are the Companies Act 2006, UK adopted international accounting standards, the rules of the Solicitors
Regulation Authority, the rules of the Alternative Investment Market, and UK taxation legislation.
• We obtained an understanding of how the Group and Parent Company complies with these requirements by discussions
with management and those charged with governance.
• We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to
fraud and how it might occur, by holding discussions with management and those charged with governance.
• We inquired of management and those charged with governance as to any known instances of non-compliance or
suspected non-compliance with laws and regulations.
• Based on this understanding, we designed specific appropriate audit procedures to identify instances of non-compliance
with laws and regulations. This included making enquiries of management and those charged with governance and
obtaining additional corroborative evidence as required.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances
of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the
financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not
detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional
misrepresentations, or through collusion.
Use of our report
This report is made solely to the Parent Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken for no purpose other than to draw to the attention of the Parent
Company’s members those matters which we are required to include in an auditor’s report addressed to them. To the fullest
extent permitted by law, we do not accept or assume responsibility to any party other than the Parent Company and the Parent
Company’s members as a body, for our work, for this report, or for the opinions we have formed.
John Staniforth (Senior Statutory Auditor)
for and on behalf of Moore Kingston Smith LLP
Chartered Accountants
Statutory Auditor
6th Floor
9 Appold Street
London EC2A 2AP
30 April 2024
58
59
Consolidated statement of comprehensive income
Consolidated statement of financial position
For the year ended 31 December 2023
As at 31 December 2023
Revenue
Proceeds on disposal of damages based agreements
Other operating income
Disbursement asset revenue
Disbursement asset expenditure
Personnel costs
Depreciation and amortisation expense
Other expenses
(Loss) from operations
EBITDA
Non-underlying items
Costs of acquiring subsidiary
Contract assets - damages based agreement asset impairment
Release of onerous contract provision
Trade receivables – provision against damages based agreement re-ceivable
Costs associated with disposal of LionFish
Costs associated with re-financing project
Other one-off costs
Trade receivables provision change
Restructuring (release)/costs
Adjusted EBITDA
Finance expense
Finance income
Loss on sale of associate
(Loss) before tax
Tax income/(expense)
(Loss) from continuing operations
Profit/(Loss) on discontinued operations, net of tax
Impairment associated with discontinued operation
(Loss) for the year
Total (loss) and comprehensive income attributable to:
Owners of the parent
Non-controlling interest
1 Jan to
31 Dec 2023
1 Jan to
17
31 Dec 2022
Restated
Note
£
£
5
5
7
8
8
39,209,854
44,873,908
-
2,021,700
885,422
156,046
1,221,854
2,847,487
(827,834)
(3,241,507)
10
(26,878,460)
(27,184,117)
(3,251,607)
(3,432,764)
(19,606,276)
(16,816,487)
9
(9,247,048)
(775,734)
(5,995,440)
2,657,030
6
25,000
367,303
-
6,670,481
301,727
920,127
5,648,109
787,193
2,081,890
1,038,163
(168,167)
562,979
1,296,470
-
-
-
-
803,631
4,638,602
12,357,894
11
11
21
(2,170,109)
(1,333,663)
51,318
-
14,509
(21,643)
(11,365,839)
(2,116,531)
12, 13
322,721
469,118
(11,043,118)
(1,647,413)
13
20
818,932
(3,073,351)
(13,694,754)
-
(23,918,940)
(4,720,763)
(23,918,940)
(4,335,201)
-
(385,562)
(23,918,940)
(4,720,763)
(11.58)
(11.58)
(25.09)
(25.05)
(1.73)
(1.73)
(4.55)
(4.55)
Company registered number: 11189598
Note
£
£
£
31 Dec 2022
18
31 Dec 2023
restated
31 Jan 2022
restated
Assets
Current assets
Trade and other receivables
Current tax asset
Cash and cash equivalents
Non-current assets
Property, plant and equipment
Right-of-use assets
Intangible assets
Deferred tax
Litigation assets
Trade and other receivables
Investments in associates
Assets held for sale
Total assets
Liabilities
Current liabilities
Trade and other payables
Leases
Current tax liabilities
Provisions
Loans and borrowings
Non-current liabilities
Loans and borrowings
Deferred tax liabilities
Provisions
Leases
Liabilities held for sale
Total liabilities
NET ASSETS
Issued capital and reserves attributable to owners of the parent
Share capital
Share premium reserve
Retained (losses)/earnings
Non-controlling interest
TOTAL EQUITY
22
22
16
17
18
26
32
22
21
18,374,752
27,214,577
19,330,914
725,723
656,982
-
2,262,750
2,588,240
4,736,546
21,363,225
30,459,799
24,067,460
2,047,706
2,208,091
2,582,911
12,390,892
14,419,414
15,913,008
40,488,453
38,693,983
55,859,230
216,445
-
-
-
-
-
-
-
-
-
6,402,444
101,643
55,143,496
55,321,488
80,859,236
13
3,369,134
22,882,556
4,922,385
79,875,854
108,663,843
109,849,081
23
17
23
25
24
24
26
25
17
13
27
28
28
11,593,485
9,642,454
10,099,544
2,224,373
1,979,578
-
-
75,000
605,556
2,150,440
1,002,637
164,291
2,624,407
2,205,640
2,129,592
16,517,264
14,433,228
15,546,504
22,687,488
20,000,000
17,000,000
-
150,000
229,361
150,000
850,042
150,000
11,344,768
13,713,932
13,698,661
34,182,255
34,093,293
31,698,703
958,476
7,528,822
2,053,440
51,657,996
56,055,344
49,298,647
28,217,858
52,608,500
60,550,434
190,662
190,662
190,662
49,232,606
49,232,606
49,232,606
(21,205,410)
3,185,232
10,840,271
28,217,858
52,608,500
60,263,539
-
-
286,895
28,217,858
52,608,500
60,550,434
The financial statements on pages 58 to 103 were approved and authorised for issue by the Board of Directors on 30 April 2024
and were signed on its behalf by:
Earnings per share attributable to the ordinary equity holders of the parent
14
Basic (pence) from continuing operations
Diluted (pence) from continuing operations
Basic (pence) from total operations
Diluted (pence) from total operations
There were no elements of other comprehensive income for the financial year other than those included in the income
statement.
The attached notes form part of these financial statements.
Jon Divers, Director
The attached notes form part of these financial statements
17 Comparatives have been restated to present Convex Capital as a discontinued operation. Refer to Note 13 for further details.
18 Comparatives have been restated to present Convex as a discontinued operation. Refer to Note 13 for further details.
Financial Statements
60
Consolidated statement of cash flows
For the year ended 31 December 2023
Cash flows from operating activities
(Loss) for the year before tax from:
Continuing operations
Discontinued operations
Adjustments for:
Depreciation of property, plant and equipment
Amortisation of right-of-use assets
Amortisation of intangible fixed assets
Fair value movement of litigation assets net of realisations
Impairment of contract assets (damages based agreement asset)
Release of onerous contract provision
Trade receivables – provision against damages based agreement receivable
Finance income
Finance expense
Loss on sale of equity accounted associate
Decrease/(increase) in trade and other receivables
Increase in trade and other payables
(Increase) in litigation assets
(Decrease)/increase in provisions
Cash generated from operations
Tax paid
Net cash flows (used in)/generated from operating activities
Investing activities
Purchase of property, plant and equipment
Sale of associate
Purchase of other intangibles
Disposal of discontinued operations litigation assets
Consideration received (litigation assets)
Payment of deferred consideration
Interest received
Net cash generated from/(used in) investing activities
Financing activities
Dividends paid to holders of the parent
Proceeds from loans and borrowings
Repayment of loans and borrowings
Repayments of lease liabilities
Interest paid on loans and borrowings
Interest paid on lease liabilities
Net cash (used in) financing activities
Net (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash and cash equivalents – continuing operations
Cash and cash equivalents – discontinued operations
Cash and cash equivalents per consolidated balance sheet
The attached notes form part of these financial statements.
19 Comparatives have been restated to present Convex as a discontinued operation. Refer to Note 13 for further details.
Note
2023
£
19
2022
restated
£
(11,365,839)
(2,116,531)
673,594
(3,772,086)
500,559
556,403
2,138,917
2,153,585
738,611
(1,168,566)
-
301,727
920,127
(51,646)
837,413
5,218,176
6,670,481
562,979
1,296,470
(32,739)
2,213,795
1,361,514
-
21,643
(5,098,721)
12,757,308
3,788,638
(3,600,176)
1,083,815
3,609,645
(325,488)
(530,556)
(7,781,846)
441,265
(1,082,312)
5,426,196
(899,649)
(601,569)
(1,981,961)
4,824,627
(326,941)
(199,741)
-
80,000
18
(2,500,000)
1,821,800
3,782,098
-
-
-
-
(2,248,319)
51,646
32,739
2,828,604
(2,335,321)
15
(471,702)
(4,736,071)
3,249,950
5,000,000
(718,888)
(2,000,000)
(1,841,233)
(1,211,829)
(1,197,725)
(509,019)
(756,768)
(528,698)
(1,488,617)
(4,233,366)
(641,974)
(1,744,060)
3,012,083
4,756,143
2,370,109
3,012,083
2,262,750
2,588,240
13
107,359
423,843
2,370,109
3,012,083
61
Consolidated statement of changes in equity
For the year ended 31 December 2023
Current year
Share
Capital
Share
Premium
Retained
Earnings
Total
attributable
to equity
holders of
parent
Non-
controlling
interest
Balance at 1 January 2023 as originally presented
190,662
49,232,606
11,996,470
61,419,738
Correction of error (refer to note 32)
Balance at 1 January 2023
-
-
(8,811,238)
(8,811,238)
190,662 49,232,606
3,185,232
52,608,500
£
£
£
£
Comprehensive income for the year
Loss for the year
Total comprehensive loss for the year
Contributions by and distributions to owners
Dividends
Total contributions by and distributions to owners
-
-
-
-
-
-
-
-
(23,918,940)
(23,918,940)
(23,918,940)
(23,918,940)
(471,702)
(471,702)
(471,702)
(471,702)
Balance at 31 December 2023
190,662 49,232,606
21,205,410
28,217,858
The attached notes form part of these financial statements.
£
-
-
-
-
-
-
-
-
Consolidated statement of changes in equity
For the year ended 31 December 2023 (continued)
Prior year
Share
Capital
Share
Premium
Retained
Earnings
Total
attributable
to equity
holders of
parent
Non-
controlling
interest
£
£
£
£
£
Total
equity
£
61,419,738
(8,811,238)
52,608,500
(23,918,940)
(23,918,940)
(471,702)
(471,702)
28,217,858
Total
equity
£
Balance at 1 January 2022 as originally presented
190,662
49,232,606
11,113,365
60,536,633
286,895
60,823,528
Correction of error (refer to note 32)
-
-
(273,094)
(273,094)
-
(273,094)
Balance at 1 January 2022
(restated, refer to note 32)
Comprehensive income for the year
(Loss) for the year (restated, refer to note 32)
Comprehensive income for the year
Contributions by and distributions to owners
Dividends
Purchase of NCI share capital
Reversal of call option over shares of associate
Reversal of put option over shares of subsidiary
Total contributions by and distributions to owners
190,662 49,232,606
10,840,271
60,263,539
286,895
60,550,434
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(4,335,201)
(4,335,201)
(385,562)
(4,720,763)
(4,335,201)
(4,335,201)
(385,562)
(4,720,763)
(4,736,071)
(4,736,071)
-
(4,736,071)
(98,767)
500,000
(98,767)
500,000
1,015,000
1,015,000
98,667
(100)
-
-
500,000
1,015,000
(3,319,838)
(3,319,838)
98,667
(3,221,171)
Balance at 31 December 2022
190,662 49,232,606
3,185,232
52,608,500
-
52,608,500
The attached notes form part of these financial statements.
Financial Statements
62
Company statement of financial position
As at 31 December 2023
Company statement of cash flows
For the year ended 31 December 2023
63
Company registered number: 11189598
Assets
Current assets
Trade and other receivables
Cash and cash equivalents
Current tax assets
Non-current assets
Trade and other receivables
Property, plant and equipment
Investments in subsidiaries
Total assets
Liabilities
Current liabilities
Trade and other payables
Loans and borrowings
Non-current liabilities
Loans and borrowings
Deferred tax liabilities
Total liabilities
NET ASSETS
Issued capital and reserves attributable to owners of the parent
Share capital
Share premium reserve
Retained earnings
31 Dec 2023
31 Dec 2022
restated
Note
£
£
22
22
22
16
20
23
24
24
26
27
28
28
4,394,018
14,204,102
340,549
145,364
413,635
-
4,879,931
14,617,737
40,412,117
39,554,433
-
45
13,806,624
27,501,378
54,218,741
67,055,856
59,098,672
81,673,593
4,219,262
2,624,407
4,290,801
2,205,640
6,843,669
6,496,441
22,687,488
20,000,000
199,505
635,334
22,886,993
20,635,334
29,730,661
27,131,775
29,368,011
54,541,818
190,662
190,662
49,232,606
49,232,606
(20,055,257)
5,118,550
29,368,011
54,541,818
Cash flows from operating activities
Loss/Profit for the year before tax
Adjustments for:
Depreciation of property, plant and equipment
Impairment of investment in discontinued operation
Finance income
Finance expense
(Increase)/decrease in trade and other receivables
Increase in trade and other payables
Cash (used in)/generated from operations
Tax paid
Net cash flows from operating activities
Investing activities
Sale of associate
Purchase of NCI share capital
Amounts repaid by/(loaned to) subsidiaries
Interest received
Net cash flows (used in) investing activities
Financing activities
Dividends paid to holders of the parent
Amounts (repaid to)/borrowed from subsidiaries
Proceeds from loans and borrowings
Repayment of loans and borrowings
Interest paid on loans and borrowings
Net cash flows generated from/(used in) financing activities
Net (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
The attached notes form part of these financial statements.
Note
2023
£
2022
£
(25,137,934)
3,491,188
16
45
13,694,754
(10,648)
1,666,894
1,038
-
(14,164)
811,352
(9,786,889)
4,289,414
(445,778)
575,785
1,329,641
379,823
(9,656,882)
5,998,878
(145,362)
-
(9,802,244)
5,998,878
15
-
-
80,000
(100)
9,398,176
(7,435,942)
10,648
14,164
9,408,824
(7,341,879)
(471,702)
(647,324)
3,249,950
(4,736,071)
1,767,522
5,000,000
(718,888)
(2,000,000)
(1,091,703)
320,334
(735,304)
(703,853)
(73,086)
(2,046,854)
413,635
2,460,489
340,549
413,635
The Company has taken advantage of the exemption contained in S408 Companies Act 2006 and has not presented a separate
income statement for the Company. The Company recorded a loss after tax of £24,702,105 for the year ended 31 December
2022 (2022: profit £4,419,482).
The financial statements on pages 58 to 103 were approved and authorised for issue by the Board of Directors on 30 April 2024
and were signed on its behalf by:
Jon Divers
Director
The attached notes form part of these financial statements.
Financial Statements
64
65
Company statement of changes in equity
Notes to the consolidated and company financial statements
For the year ended 31 December 2023
1. Basis of preparation
Current year
Share Capital
Share Premium Retained Earnings
£
£
£
Total
£
Balance at 1 January 2023
190,662
49,232,606
5,118,550
54,541,818
Comprehensive profit for the year
Loss for the year
Total comprehensive profit for the year
Contributions by and distributions to owners
Dividends
Total contributions by and distributions to owners
-
-
-
-
-
-
-
-
(24,702,105)
(24,702,105)
(24,702,105)
(24,702,105)
(471,702)
(471,702)
(471,702)
(471,702)
Balance at 31 December 2023
190,662
49,232,606
(20,055,257)
29,368,011
RBG Holdings plc is a public limited company, incorporated in the United Kingdom. The principal activity of the Group is the
provision of legal and professional services, including management and financing of litigation projects.
The Group and Company financial statements have been prepared in accordance with UK adopted international accounting
standards and those parts of the Companies Act 2006 applicable to companies reporting under UK adopted international
accounting standards. These financial statements consolidate those of the Company and its subsidiaries (together referred to
as the “Group”). The Company has taken advantage of the exemption contained in S408 Companies Act 2006 and has not
presented a separate income statement for the Company.
The financial statements have been prepared for year ended 31 December 2023, with a comparative year to 31 December 2022
(restated), and are presented in Sterling, which is also the Group’s functional currency.
The principal accounting policies adopted in the preparation of the consolidated financial statements are set out in Note 2. The
policies have been consistently applied to the year presented, unless otherwise stated.
The preparation of financial statements in compliance with UK adopted international accounting standards requires the use
of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group’s
accounting policies. The areas where significant judgements and estimates have been made in preparing the financial
statements and their effect are disclosed in Note 3.
The attached notes form part of these financial statements.
Prior year
Share Capital
Share Premium RetainedEarnings
£
£
£
Total
£
Basis of measurement
The consolidated financial statements have been prepared on a historical cost basis.
Balance at 1 January 2022
190,662
49,232,606
5,435,139
54,858,407
Discontinued operations
Comprehensive profit for the year
Profit for the year
Total comprehensive profit for the year
Contributions by and distributions to owners
Dividends
Total contributions by and distributions to owners
-
-
-
-
-
-
-
-
4,419,482
4,419,482
4,419,482
4,419,482
(4,736,071)
(4,736,071)
(4,736,071)
(4,736,071)
Balance at 31 December 2022
190,662
49,232,606
5,118,650
54,541,818
The attached notes form part of these financial statements.
During the year, the Board approved plans to dispose of the Group’s interests in Convex. Convex is classified as held for sale at
the balance sheet date. The net results of Convex have been presented as discontinued operations in the Group statement of
comprehensive income (for which the comparatives have been restated). See Note 13 for further details.
Going concern
The Group has prepared financial projections to April 2025, the going concern review period. The Board recognises that
the Groups’ financial performance in 2023 included a decline in revenue and a total reported loss (including discontinued
operations) after tax of £23,918,941. This loss included an impairment of Convex Capital intangible assets of £13,694,754 and
one-off costs that are considered to be exceptional totalling £10,634,042. After the reporting date, the Group raised a total of
£3.0 million before expenses through the issue of new ordinary shares and completed the disposal of Convex Capital for an
initial consideration of £2.0 million.
The Directors are confident that much of these losses were attributable to factors that will not impact the Group going forward.
The financial projections performed form part of a three-year plan which shows positive earnings and cash flow generation and
projected compliance with banking covenants at each testing date.
The Board confirm that they have a reasonable expectation that the Group has adequate resources to continue in operational
existence for at least 12 months from the date of signing the financial statements.
This confirmation is made after reviewing assumptions about the future trading performance. This process included a reverse
`stress test’ used to inform downside testing which identified the break point in the Group’s liquidity.
Whilst the sensitivities applied do show an expected downside impact on the Group’s financial performance in future periods,
for all scenarios modelled, the Board have identified appropriate mitigating actions, including lowering capital expenditure,
reductions in personnel and overhead expenditure and other short-term cash management activities within the Group’s control
as part of their assessment of going concern.
Financial Statements 66
Changes in accounting policies
A. New standards, interpretations and amendments effective from 1 January 2023
New standards that have been adopted in the annual financial statements for the year ended 31 December 2023
but have not had a significant effect on the Group are:
• Disclosure of Accounting Policies (Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice
Statement 2 Making Materiality Judgements);
• Definition of Accounting Estimates (Amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates
and Errors);
• Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12 Income Taxes); and
• International Tax Reform – Pillar Two Model Rules (Amendment to IAS 12 Income Taxes) (effective immediately upon the
issue of the amendments and retrospectively)
B. New standards, interpretations and amendments not yet effective
There are a number of standards, amendments to standards, and interpretations which have been issued by the IASB that are
effective in future accounting periods that the Group has decided not to adopt early.
The following amendments are effective for the period beginning 1 January 2024:
• Liability in a Sale and Leaseback (Amendments to IFRS 16 Leases);
• Classification of Liabilities as Current or Non-Current (Amendments to IAS 1 Presentation of Financial Statements);
• Non-current Liabilities with Covenants (Amendments to IAS 1 Presentation of Financial Statements); and
• Supplier Finance Arrangements (Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments:
Disclosures)
The Group is currently assessing the impact of these new accounting standards and amendments and does not expect that
they will have a material impact on the Group.
The following amendments are effective for the period beginning 1 January 2025:
• Lack of Exchangeability (Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates)
C. Prior year restatement
During the current financial year, it was identified that previous accounting policy to capitalise Rosenblatt disbursements
(including counsel fees) associated with its Damages Based Agreement (“DBA”) matters as litigation assets and measure the
assets under IFRS 9 at
fair value through profit and loss was incorrect.
These disbursements constitute payments of costs to fulfil a contract under IFRS 15 that could be reimbursed in the future
depending on the outcome of the case. They should be capitalised to the extent that they are expected to be recovered.
There are two specific cases that this error impacts and each is treated differently based on the terms of the agreement.
For the first case, the disbursements are payable to the Group, only if the case wins or where the client or the Group terminates
the engagement. Under IFRS 15, this case is treated as a contract asset and an impairment assessment is performed under
IFRS 15. During the year ended 31 December 2022, the probability of success was reduced from 90% to 50%, at this point, the
contract asset was written off and the case became an onerous contract and costs to fulfil the contract were provided for.
For the second case, the disbursements are recoverable in a win or lose situation. As such, the revenue recognition point
is the point at which the expense is incurred by the Group. IFRS 15 requires the presentation of any unconditional rights to
consideration as a receivable separately from contract assets and an expected credit loss (ECL) assessment is performed at
year end.
Refer to Note 32 Restatement of prior year for further information.
67
2. Accounting policies
Revenue
Revenue comprises the fair value of consideration receivable in respect of services provided during the year, inclusive of
recoverable expenses incurred but excluding value added tax.
Legal services revenues
Where fees are contractually able to be rendered by reference to time charged at agreed rates, the revenue is recognised over
time, based on time worked charged at agreed rates, to the extent that it is considered recoverable.
Where revenue is subject to contingent fee arrangements, including where services are provided under Damages Based
Agreements (DBAs), the Group estimates the amount of variable consideration to which it will be entitled and constrains the
revenue recognised to the amount for which it is considered highly probable that there will be no significant reversal. Due to
the nature of the work being performed, this typically means that contingent revenues are not recognised until such time as the
outcome of the matter being worked on is certain.
The Group has two cases under Damages Based Agreements.
For the first case, the disbursements are recoverable either in the case of a win, or where the client or the Group terminates the
engagement. The recovery of the disbursements are recognised as revenue under IFRS 15 to the extent it is highly probable
that a significant reversal in the amount will not occur in the future. Under IFRS 15, this case is treated as a contract asset, and an
impairment assessment is performed in line with the standard.
For the second case, disbursements are recoverable in a win or lose situation. As such, the revenue recognition point is the point
at which the expense is incurred by the Group, when a disbursement is incurred, the Group recognises the expense incurred in
the profit or loss and the associated revenue in relation to the recovery of the disbursement. IFRS 15 requires the presentation
of any unconditional rights to consideration as a receivable separately from contract assets. At each reporting date, the Group
performs an expected credit loss (ECL) assessment on the receivable line with IFRS 9, and where applicable, an impairment is
recognised.
Bills raised are payable on delivery and until paid form part of trade receivables. The Group has taken advantage of the practical
exemption in IFRS 15 not to account for significant financing components where the Group expects the time difference between
receiving consideration and the provision of the service to a client will be one year or less. Where revenue has not been billed at
the balance sheet date, it is included as contract assets and forms part of trade and other receivables.
Corporate finance revenues
Corporate finance revenue is contingent on the completion of a deal and is recognised when the deal has completed. Bills
raised are payable on deal completion and are generally paid at that time.
Interest received on client monies
Interest is recognised on client monies held, this is recognised in the profit or loss based on the effective interest rate during the
period. This forms part of other income as this is driven by the ongoing operations of the business,
Adjusted EBITDA and exceptionals
The Group presents adjusted EBITDA as an operating KPI utilised by management to monitor performance.
EBITDA is adjusted for one-off costs that are considered to be exceptional, being:
• One-off costs connected to acquisitions
• Contract assets - damages based agreement asset impairment
• Release of onerous contract provision
• Trade receivables – provision against damages based agreement receivable
• Group costs associated with discontinued operations
• Costs associated with refinancing project
• Release of restructuring costs
• Trade receivables provision change
These costs are considered to be exceptional because they do not relate to the ongoing trade and performance of the business.
Without presenting adjusted EBITDA, the EBITDA would not be consistent as it would be subject to fluctuations that do not
reflect underlying performance of the Group.
Financial Statements 68
Basis of consolidation
Where the company has control over an investee, it is classified as a subsidiary. The company controls an investee if all three of
the following elements are present: power over the investee, exposure to variable returns from the investee, and the ability of
the investor to use its power to affect those variable returns. Control is reassessed whenever facts and circumstances indicate
that there may be a change in any of these elements of control.
The consolidated financial statements present the results of the company and its subsidiaries (“the Group”) as if they formed a
single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the acquisition method.
In the statement of financial position, the acquiree’s identifiable assets, liabilities and contingent liabilities are initially
recognised at their fair values at the acquisition date. The results of acquired operations are included in the consolidated
statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date
on which control ceases.
Goodwill
Goodwill represents the excess of the cost of a business combination over the Group’s interest in the fair value of identifiable
assets, liabilities and contingent liabilities acquired.
Cost comprises the fair value of assets given, liabilities assumed, and equity instruments issued, plus the amount of any
non-controlling interests in the acquiree plus, if the business combination is achieved in stages, the fair value of the existing
equity interest in the acquiree. Contingent consideration is included in cost at its acquisition date fair value and, in the case
of contingent consideration classified as a financial liability, remeasured subsequently through profit or loss. Direct costs of
acquisition are recognised immediately as an expense.
Goodwill is capitalised as an intangible asset with any impairment in carrying value being charged to the consolidated statement
of comprehensive income. Where the fair value of identifiable assets, liabilities and contingent liabilities exceed the fair value of
consideration paid, the excess is credited in full to the consolidated statement of comprehensive income on the acquisition date.
Impairment of non-financial assets (excluding inventories, investment
properties and deferred tax assets)
Impairment tests on goodwill and other intangible assets with indefinite useful economic lives are undertaken annually at the
financial period end. Other non-financial assets are subject to impairment tests whenever events or changes in circumstances
indicate that their carrying amount may not be recoverable. Where the carrying value of an asset exceeds its recoverable
amount (i.e., the higher of value in use and fair value less costs to sell), the asset is written down accordingly.
Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the
smallest group of assets to which it belongs for which there are separately identifiable cash flows; its cash generating units
(‘CGUs’). Goodwill is allocated on initial recognition to each of the Group’s CGUs that are expected to benefit from a business
combination that gives rise to the goodwill.
Impairment charges are included in profit or loss, except to the extent they reverse gains previously recognised in other
comprehensive income. An impairment loss recognised for goodwill is not reversed.
Foreign currency
Transactions entered into by Group entities in a currency other than the currency of the primary economic environment in
which they operate (their “functional currency”) are recorded at the rates ruling when the transactions occur. Foreign currency
monetary assets and liabilities are translated at the rates ruling at the reporting date. Exchange differences arising on the
retranslation of unsettled monetary assets and liabilities are recognised immediately in profit or loss.
69
Financial assets
The Group classifies its financial assets under the amortised cost category, the Group’s accounting policy is as follows:
Fair value through profit or loss
Litigation assets relate to the provision of funding to litigation matters in return for a participation share in the settlement of that
case. Investments are initially measured at the sum invested and are subsequently held at fair value through the profit or loss.
When the Group disposes of a proportion of its participation share in the settlement of the case to a third-party under an
uninsured (“naked”) contract, where the percentage of the litigation asset being disposed of and the percentage return remain
proportionate irrespective of the final outcome of the litigation, the difference between the disposal proceeds and the cost of
investment disposed gives rise to a profit on disposal which is recognised through the profit and loss when the sale is agreed.
These sales are non-recourse and, if the case is successful, the relevant % of the settlement received is paid to the third-party.
For uninsured cases, the Group uses the value of third-party disposals to calculate the gross value of the proportion of the
investment retained by the Group and deducts the expected cost of investment to be borne by the Group to give the fair value
of the Group’s investment. The proportion of each investment retained is calculated using the expected total return on the
investment, the expected return payable to the onward investor and the expected total return retained by the Group.
For insured cases, when the Group disposes of a proportion of its participation share in the settlement of the case to a third-
party, where the third-party return is calculated as a fixed percentage daily rate irrespective of the settlement value of a
successful litigation outcome, the derecognition requirements under IFRS 9 para 3.2.2 are not met and no sale or profit on
disposal arise. The Group retains the full litigation asset and the proceeds of disposal under the third-party contract are included
as litigation liabilities. The fair value of the litigation asset is calculated using the expected total return retained by the Group in
the different possible outcomes factored by Management’s expectation of the likelihood of each outcome.
Litigation assets are reviewed for impairment where events or circumstances indicate that their carrying amount may
not be recoverable. Where the carrying value of the litigation assets exceeds its recoverable amount, the asset is written
down accordingly.
As part of the sale of LionFish during the year, three litigation asset cases were retained by the Group and not included in the
sale, they were subsequently impaired to nil in the year.
Amortised cost
These assets arise principally from the provision of goods and services to customers (e.g., trade receivables), but also incorporate
other types of financial assets where the objective is to hold these assets in order to collect contractual cash flows and the
contractual cash flows are solely payments of principal and interest. They are initially recognised at fair value plus transaction
costs that are directly attributable to their acquisition or issue and are subsequently carried at amortised cost using the effective
interest rate method, less provision for impairment.
Impairment provisions for current and non-current trade receivables are recognised based on the simplified approach within
IFRS 9 using a provision matrix in the determination of the lifetime expected credit losses. During this process the probability
of the non-payment of the trade receivables is assessed. This probability is then multiplied by the amount of the expected
loss arising from default to determine the lifetime expected credit loss for the trade receivables. For trade receivables, which
are reported net, such provisions are recorded in a separate provision account with the loss being recognised in profit or loss.
On confirmation that the trade receivable will not be collectable, the gross carrying value of the asset is written off against the
associated provision.
From time to time, the Group elects to renegotiate the terms of trade receivables due from customers with which it has
previously had a good trading history. Such renegotiations will lead to changes in the timing of payments rather than changes
to the amounts owed and, in consequence, the new expected cash flows are discounted at the original effective interest
rate and any resulting difference to the carrying value is recognised in the consolidated statement of comprehensive income
(operating profit).
Impairment provisions for receivables from related parties and loans to related parties, including those from subsidiary
companies, are recognised based on a forward looking expected credit loss model. The methodology used to determine the
amount of the provision is based on whether there has been a significant increase in credit risk since initial recognition of the
financial asset. This annual assessment considers forward-looking information on the general economic and specific market
conditions together with a review of the operating performance and cash flow generation of the entity relative to that at initial
recognition. For those where the credit risk has not increased significantly since initial recognition of the financial asset, twelve
month expected credit losses along with gross interest income are recognised. For those for which credit risk has increased
significantly, lifetime expected credit losses along with the gross interest income are recognised. For those that are determined
to be credit impaired, lifetime expected credit losses along with interest income on a net basis are recognised.
The Group’s financial assets measured at amortised cost comprise trade and other receivables and cash and cash equivalents
in the consolidated statement of financial position. Cash and cash equivalents includes cash in hand, deposits held at call with
banks, and other short term highly liquid investments with original maturities of three months or less.
Financial Statements 70
Financial liabilities
The Group classifies its financial liabilities depending on the purpose for which the liability was acquired.
Other financial liabilities
All the Group’s financial liabilities are classified as other financial liabilities, which include the following items:
Bank borrowings are initially recognised at fair value net of any transactions costs directly attributable to the issue of the
instrument. Such interest bearing liabilities are subsequently measured at amortised cost using the effective interest rate
method, which ensures that any interest expense over the period to repayment is at a constant rate on the balance of
the liability carried in the consolidated statement of financial position. For the purposes of each financial liability, interest
expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon
payable while the liability is outstanding.
Trade payables and other short-term monetary liabilities, which are initially recognised at fair value and subsequently carried at
amortised cost using the effective interest method.
Defined contribution schemes
Contributions to defined contribution pension schemes are charged to the consolidated statement of comprehensive income in
the year to which they relate.
Short-term benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is
provided. A liability is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the
Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and
the obligation can be estimated reliably.
Share-based payments
Where equity settled share options are awarded to employees, the fair value of the options at the date of grant is charged
to the consolidated statement of comprehensive income over the vesting period. Non-market vesting conditions are taken
into account by adjusting the number of equity instruments expected to vest at each reporting date so that, ultimately, the
cumulative amount recognised over the vesting period is based on the number of options that eventually vest. Non-vesting
conditions and market vesting conditions are factored into the fair value of the options granted. As long as all other vesting
conditions are satisfied, a charge is made irrespective of whether market vesting conditions are satisfied. The cumulative
expense is not adjusted for failure to achieve a market vesting condition or where a non-vesting condition is not satisfied.
Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured
immediately before and after the modification, is also charged to the consolidated statement of comprehensive income over the
remaining vesting period. Where equity instruments are granted to persons other than employees, the consolidated statement
of comprehensive income is charged with the fair value of goods and services received.
Leased assets
Identifying leases
The Group accounts for a contract, or a portion of a contract, as a lease when it conveys the right to use an asset for a period of
time in exchange for consideration. Leases are those contracts that satisfy the following criteria:
(a) There is an identified asset;
(b) The Group obtains substantially all the economic benefits from use of the asset; and
(c) The Group has the right to direct use of the asset
The Group considers whether the supplier has substantive substitution rights. If the supplier does have those rights, the contract
is not identified as giving rise to a lease.
In determining whether the Group obtains substantially all the economic benefits from use of the asset, the Group considers
only the economic benefits that arise from use of the asset, not those incidental to legal ownership or other potential benefits.
In determining whether the Group has the right to direct use of the asset, the Group considers whether it directs how and for
what purpose the asset is used throughout the period of use. If there are no significant decisions to be made because they are
pre-determined due to the nature of the asset, the Group considers whether it was involved in the design of the asset in a way
that predetermines how and for what purpose the asset will be used throughout the period of use. If the contract or portion of
the contract does not satisfy these criteria, the Group applies other applicable IFRSs rather than IFRS 16.
All leases are accounted for by recognising a right-of-use asset and a lease liability except for:
• Leases of low value assets; and
• Leases with a term of 12 months or less
71
Lease liabilities are measured at the present value of the contractual payments due to the lessor over the lease term, with the
discount rate determined by reference to the rate inherent in the lease unless this is not readily determinable, in which case the
Group’s incremental borrowing rate on commencement of the lease is used. Variable lease payments are only included in the
measurement of the lease liability if they depend on an index or rate. In such cases, the initial measurement of the lease assumes
the variable element will remain unchanged throughout the lease term. Other variable lease payments are expensed in the
period to which they relate.
On initial recognition, the carrying value of the lease liability also includes:
• amounts expected to be payable under any residual value guarantee
• the exercise price of any purchase option granted in favour of the Group if it is reasonably certain to assess that option
• any penalties payable for terminating the lease, if the term of the lease has been estimated on the basis of the termination
option being exercised
Right-of-use assets are initially measured at the amount of the lease liability, reduced for any lease incentives received, and
increased for:
• lease payments made at or before the commencement of the lease
• initial direct costs incurred and
• the amount of any provision recognised where the Group is contractually required to dismantle, remove or
restore the leased asset
Subsequent to initial measurement lease liabilities increase as a result of interest charged at a constant rate on the balance
outstanding and are reduced for lease payments made. Right-of-use assets are amortised on a straight-line basis over the
remaining term of the lease or over the remaining economic life of the asset if this is judged to be shorter than the lease term.
When the Group revises its estimate of the term of any lease, it adjusts the carrying amount of the lease liability to reflect
the payments to make over the revised term, which are discounted using a revised discount rate. The carrying value of lease
liabilities is similarly revised when the variable element of future lease payments dependent on a rate or index is revised, except
the discount rate remains unchanged. In both cases an equivalent adjustment is made to the carrying value of the right-of-use
asset, with the revised carrying amount being amortised over the remaining lease term.
The lease calculations have been prepared up to the end of the lease term as defined in the lease agreements. Where there has
been a remeasurement or rent-free-period, the lease calculations are adjusted accordingly.
For contracts that both convey a right to the Group to use an identified asset and require services to be provided to the Group
by the lessor for a variable amount, the Group has elected to account for the right-of-use payments as a lease and expense the
service charge payments in the period to which they relate.
Externally acquired intangible assets
Externally acquired intangible assets are initially recognised at cost and subsequently amortised over their useful economic lives.
Intangible assets are recognised on business combinations if they are separable from the acquired entity or give rise to other
contractual/legal rights. The amounts ascribed to such intangibles are arrived at by using appropriate valuation techniques.
The significant intangibles recognised by the Group, their useful economic lives and the methods used for amortisation and to
determine the cost of intangibles acquired in a business combination are as follows:
Intangible
asset
Brand
Useful
economic life
Remaining useful
economic life
Amortisation
method
Valuation
method
20 years
14 – 19 years
Straight line
Estimated discounted cash flow
Customer contracts
1 – 2 years
Nil
In line with contract revenues
Estimated discounted cash flow
Restrictive covenant extension
5 years
4 years
Straight line
Cost
Non-current investments
Investments in subsidiary undertakings are stated at cost less amounts written off for impairment. Investments are reviewed for
impairment where events or circumstances indicate that their carrying amount may not be recoverable.
Dividends
Dividends are recognised when they become legally payable. In the case of interim dividends to equity shareholders, this is
when declared by the directors. In the case of final dividends, this is when approved by the shareholders at the AGM.
Financial Statements 72
Income tax
Income tax expense represents the sum of the tax currently payable.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the statement
of comprehensive income because it excludes items of income or expense that are taxable or deductible in other years and it
further excludes items that are not taxable or tax deductible.
The Group’s liability for current tax is calculated using tax rates (and tax laws) that have been enacted or substantively enacted by
the end of the financial year.
Deferred taxation
Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the consolidated statement
of financial position differs from its tax base, except for differences arising on:
• the initial recognition of goodwill
• the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the
transaction affects neither accounting or taxable profit, and
• investments in subsidiaries and joint arrangements where the Group is able to control the timing of the reversal of the
difference and it is probable that the difference will not reverse in the foreseeable future
Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be available against
which the difference can be utilised.
The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted by the
reporting date and are expected to apply when the deferred tax liabilities/assets are settled /recovered.
Deferred tax assets and liabilities are offset when the Group has a legally enforceable right to offset current tax assets and
liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority on either:
• The same taxable group company, or
• Different group entities which intend either to settle current tax assets and liabilities on a net basis, or to realise the assets
and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax assets or liabilities
are expected to be settled or recovered.
Property, plant and equipment
Items of property, plant and equipment are initially recognised at cost, and subsequently stated at cost less any accumulated
depreciation and impairment losses. As well as the purchase price, cost includes directly attributable costs and the estimated
present value of any future unavoidable costs of dismantling and removing items. The corresponding liability is recognised
within provisions.
Depreciation is provided on all items of property, plant and equipment so as to write off their carrying value over their expected
useful economic lives. It is provided at the following rates:
Leasehold improvements Straight line over the life of the lease
Plant and equipment
33% per annum straight line
Fixtures and fittings
25% per annum straight line
Computer equipment
33% per annum straight line
Share Capital
Ordinary shares are recorded at nominal value and proceeds received in excess of nominal value of shares issued, if any, are
accounted for as share premium. Both ordinary shares and share premium are classified as equity.
73
Provisions
Professional indemnity provision
A provision is recognised when the Group has a present legal or constructive obligation as a result of a past event, that can
be reliably measured, and it is probable that an outflow of economic benefits will be required to settle the obligation. Where
material, the impact of the time value of money is taken into account by discounting the expected future cash flow at a pre-tax
rate, which reflects risks specific to the liability.
Insurance cover is maintained in respect of professional negligence claims. This cover is principally written through insurance
companies. Premiums are expensed as they fall due with prepayments or accruals being recognised accordingly. Expected
reimbursements are recognised once they become receivable. Where outflow of resources is considered probable and reliable
estimates can be made, provision is made for the cost (including related legal costs) of settling professional negligence claims
brought against the Group by third parties and disciplinary proceedings brought by regulatory authorities. Amounts provided
for are based on Management’s assessment of the specific circumstances in each case. No separate disclosure is made of the
detail of such claims and proceedings, as to do so could seriously prejudice the position of the Group. In the event the insurance
companies cannot settle the full liability, the liability will revert to the Group.
Dilapidations provision
The Group recognises a provision for the future costs of dilapidations on leased office space. The provision is an estimate of the
total cost to return applicable office space to its original condition at the end of the lease term.
Onerous contracts
The Group recognises a provision for the unavoidable costs of meeting a contract where the obligations of the contract exceed
the economic benefits to be received under it.
Restatements
The 2022 comparative numbers have been restated for the following corrections which is described fully in Note 32:
A prior period adjustment has been made for incorrect accounting policies that were previously adopted in relation to
disbursements incurred on two damages based agreements. The disbursements were previously held on the balance sheet as
Litigation Assets and measured the assets under IFRS 9 at fair value through profit and loss.
Based on the substances of the underlying agreements for the two damages based agreements, the recovery from the client of
disbursements represents a revenue stream arising from a costs to fulfil a contract with a customer and therefore falls within the
scope of IFRS 15, not IFRS 9. This is because IFRS 9 states that it does not apply to “rights and obligations within the scope of
IFRS 15 that are financial instruments, except for those that IFRS 15 specifies are accounted for in accordance with IFRS 9”.
For the first case, the disbursements are payable to the Group, only if the case wins or where the client or the Group terminates
the engagement. Under IFRS 15, this case is treated as a contract asset and an impairment assessment is performed under IFRS
15. Management has reassessed the probability of success during the year ended 31 December 2022 and has reduced this from
90% to 50%, at this point, the contract asset was written off the case became an onerous contract and costs to fulfil the contract
were provided for.
The reassessment made for probability of success was based on management’s assessment of the information available at
the time and hindsight has not been applied in assessing the impact of the prior period adjustment. The write off of the
contract asset at the point of probability of success reducing was £6,670,481. At that point, a provision for the onerous
contract of £956,999 was recognised. £562,979 of this provision was released during the remaining months of the year
ended 31 December 2022.
For the second case, the disbursements are recoverable in a win or lose situation. As such, the revenue recognition point
is the point at which the expense is incurred by the Group. IFRS 15 requires the presentation of any unconditional rights to
consideration as a receivable separately from contract assets and an expected credit loss (ECL) assessment is performed at year
end. The Group performed an ECL assessment at each year end for this case and determined that the disbursements are not
recoverable if the case were to lose and therefore have been provided for.
The assessment on the ECL has been made based on management’s knowledge of the case and the parties involved, hindsight
has not been applied for the of assessing the impact of the prior period adjustment. The impact of this ECL assessment was that
opening reserves were reduced by £273,094 for the provision recognised against the receivable. The provision for receivables
was increased at 31 December 2022 for £1,296,470, and an additional £920,127 recognised against the receivable at 31
December 2023.
The impact of the above prior period error has therefore impacted the 31 December 2022 basic and diluted earnings per share
figures presented in the consolidated statement of comprehensive income. Refer to Note 32 for further details.
The 2022 comparative numbers have been restated to reflect Convex being disclosed as a discontinued operation in the current
year, refer to Note 13.
Financial Statements 74
75
3. Critical accounting estimates and judgements
3. Critical accounting estimates and judgements (continued)
The Group makes certain estimates and assumptions regarding the future. Estimates and judgements are continually evaluated
based on actual experience and other factors, including expectations of future events that are believed to be reasonable
under the circumstances. In the future, actual experience may differ from these estimates and assumptions. The estimates and
assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within
the next financial period are discussed below.
Judgements, estimates and assumptions
Estimated impairment of intangible assets including goodwill
Determining whether an intangible asset is impaired requires an estimation of the value in use of the cash generating units
to which the intangible has been allocated. The value in use calculation requires the entity to estimate the future cash flows
expected to arise from each cash generating unit and determine a suitable discount rate. A difference in the estimated future
cash flows or the use of a different discount rate may result in a different estimated impairment of intangible assets.
Revenue recognition
Where the group performs work that is chargeable based on hours worked at agreed rates, assessment must be made of the
recoverability of the unbilled time at the period end. This is on a matter by matter basis, with reference to historic and post
year-end recoveries. Different views on recoverability would give rise to a different value being determined for revenue and a
different carrying value for unbilled revenue.
Where revenue is subject to alternative billing arrangements, the Group estimates the amount of variable consideration to which
it will be entitled and constrains the revenue recognised to the amount for which it is considered highly probable that there
will be no significant reversal. Due to the nature of the work being performed, this typically means that contingent revenues
are not recognised until such time as the outcome of the matter being worked on is certain. Factors the Group considers when
determining whether revenue should be constrained are whether: -
a) The amount of consideration receivable is highly susceptible to factors outside the Group’s influence
b) The uncertainty is not expected to be resolved for a long time
c) The Group has limited previous experience (or limited other evidence) with similar contracts
d) The range of possible consideration amounts is broad with a large number of possible outcomes
Different views being determined for the amount of revenue to be constrained in relation to each contingent fee arrangement
may result in a different value being determined for revenue and also a different carrying value being determined for unbilled
amounts for client work.
Disbursements incurred in association with DBAs are recognised initially under IFRS 15 as they constitute payments for costs
incurred as part of the provision of legal services to the Group’s client that could be reimbursed in the future depending on the
outcome of the case.
The Group has two DBA cases which are recognised as follows:
For the first case, the disbursements are payable to the Group, only if the case wins or where the client or Group terminates the
engagement. Under IFRS 15, this case is treated as a contract asset and an impairment assessment is performed under IFRS 15
regarding the probability of success of the case, when it becomes probable that the case will not be successful, an impairment is
required, and the contract becomes onerous. Different views on the probability of success could impact whether an impairment
is recognised. This change in accounting estimate has resulted in an impairment of nil in the current year (2022: £6,670,481).
For the second case, the disbursements are recoverable in a win or lose situation. As such, the revenue recognition point
is the point at which the expense is incurred by the Group. IFRS 15 requires the presentation of any unconditional rights to
consideration as a receivable separately from contract assets and an expected credit loss (ECL) assessment is performed by
management at year end. Different views on the ability to recover the receivable could impact the amount of provision required.
This change in accounting estimate has resulted in an increase in the provision of receivables for disbursements on this case of
£920,127 (2022: £1,296,470).
The change in accounting estimate as a result of the above prior period adjustment has resulted in a material change from the
amounts published in the 2023 interim results. The interim results recorded a write off of £11.0m associated with these DBA cases
within 2023. The prior period adjustment identified above, has resulted in the first disbursement asset case being recorded as a
contract asset and impaired within the year ending 31 December 2022, the second case is recorded as a trade receivable and has
been assessed for expected credit loss impairment at each year end. Refer to notes 22 and 32 for further information.
Where non-contingent fees as well as contingent revenue are earned on DBAs, the group must make a judgement as to
whether non-contingent amounts represent revenue or a reduction in funding, with reference to the terms of the agreement
and timing and substance of time worked and payments made. Where non-contingent revenue arises, the Group must match it
against the services to which it relates. This requires Management to estimate work done as a proportion of total expected work
to which the fee relates. Different views could impact the level of non-contingent revenue recognised.
Impairment of trade receivables
Receivables are held at cost less provisions for impairment. During the year ended 31 December 2023, the Group changes it’s
accounting for impairment provisions, they are now recognised based on the ageing of invoices with invoices over 270 days
being fully provided for, management also make an assessment for invoices under 270 days old to determine their collectability.
This change in accounting estimate has resulted in an impairment provision against trade receivables for legal services of
£3,787,379 (2022: £745,523).
Claims and regulatory matters
The Group from time to time receives claims in respect of professional service matters. The Group defends such claims where
appropriate but makes provision for the possible amounts considered likely to be payable, having regard to any relevant
insurance cover held by the Group. A different assessment of the likely outcome of each case or of the possible cost involved
may result in a different provision or cost.
In the year ending 31 December 2021, the Company was informed that HMRC had started an inquiry into the valuation
of employee related securities issued by the Company in April 2018 prior to the IPO, this inquiry is on-going. For full details,
refer to Note 33.
4. Financial instruments – Risk Management
The Group is exposed through its operations to the following financial risks:
• Credit risk
• Interest rate risk and
• Liquidity risk
In common with all other businesses, the Group is exposed to risks that arise from its use of financial instruments. This note
describes the Group’s objectives, policies and processes for managing those risks and the methods used to measure them.
Further quantitative information in respect of these risks is presented throughout these financial statements.
There have been no substantive changes in the Group’s exposure to financial instrument risks, its objectives, policies and
processes for managing those risks or the methods used to measure them from the previous period unless otherwise stated
in this note.
(i) Principal financial instruments
The principal financial instruments used by the Group, from which financial instrument risk arises, are as follows:
• Trade receivables
• Cash and cash equivalents
• Trade and other payables
• Floating-rate bank loans
(ii) Financial instruments by category
Financial assets - Group
Cash and cash equivalents
Trade and other receivables
Total financial assets
Fair value through profit or loss
31 Dec 2023
31 Dec 2022
restated
£
-
-
-
£
-
-
-
Amortised cost
31 Dec 2022
restated
31 Dec 2023
£
£
2,262,750
2,588,242
17,354,918
25,701,508
19,617,668
28,289,750
Financial Statements 76
77
4. Financial instruments – Risk Management (continued)
4. Financial instruments – Risk Management (continued)
On 31 December 2023, financial assets held at fair value through profit or loss of £nil were transferred to assets held for
sale (2022: £4,895,514). Financial assets held at amortised cost of £103,173 were transferred to assets held for sale (2022:
£5,167,655). Refer to note 13 for further details.
Financial assets - Company
Fair value through profit or loss
Amortised cost
Cash and cash equivalents
Trade and other receivables
Total financial assets
31 Dec 2023
31 Dec 2022
31 Dec 2023
31 Dec 2022
£
-
-
-
£
-
-
-
£
£
340,549
413,635
44,806,135
53,758,535
45,146,684
54,172,170
Financial Liabilities - Group
Fair value through profit or loss
31 Dec 2023
31 Dec 2022
31 Dec 2023
Amortised cost
31 Dec 2022
restated
Trade payables and accruals
Loans and borrowings
Other payables
Total financial liabilities
£
-
-
-
-
£
-
-
-
-
£
£
9,236,080
7,381,930
25,311,894
22,205,640
108,261
100
34,656,235
29,587,670
On 31 December 2023, financial liabilities carried at amortised cost of £103,972 were transferred to liabilities held for sale (2022:
£1,340,455), refer to note 13.
Financial Liabilities - Company
Fair value through profit or loss
Amortised cost
Trade payables and accruals
Total financial liabilities
31 Dec 2023
31 Dec 2022
31 Dec 2023
31 Dec 2022
£
-
-
£
-
-
£
£
4,164,191
4,290,801
4,164,191
4,290,801
Trade and other payables are due within twelve months.
(iii) Financial instruments not measured at fair value
Financial instruments not measured at fair value includes cash and cash equivalents, trade and other receivables, trade and other
payables, loans and borrowings.
Due to their short-term nature, the carrying value of cash and cash equivalents, trade and other receivables, and trade and other
payables approximates their fair value.
General objectives, policies and processes
The Board has overall responsibility for the determination of the Group’s risk management objectives and policies and, whilst
retaining ultimate responsibility for them, it has delegated the authority for designing and operating processes that ensure the
effective implementation of the objectives and policies to the Group’s finance function. The Board receives monthly reports from
the Group Finance Director through which it reviews the effectiveness of the processes put in place and the appropriateness of
the objectives and policies it sets.
The overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the Group’s
competitiveness and flexibility. Further details regarding these policies are set out below:
Credit risk
Credit risk is the risk of financial loss to the Group if a client or counterparty to a financial instrument fails to meet its contractual
obligations. The Group is mainly exposed to credit risk from credit sales. It is Group policy to assess the credit risk of new and
irregular clients before entering contracts and to require money on account of work for these clients. The Group reviews, on a
regular basis, whether to perform further work where clients have unpaid bills. The Group works with a broad spread of long-
standing reputable clients to ensure there are no significant concentrations of credit risk.
Credit risk also arises from cash and cash equivalents and deposits with banks and financial institutions. Cash and cash
equivalents are invested with banks with an A+ credit rating.
Interest rate risk
The Group is exposed to cash flow interest rate risk from borrowings under the Term Facility and Revolving Credit Facility at
variable rate. The Board reviews the interest rate exposure on a regular basis.
During 2023 and 2022, the Group’s borrowings at variable rate were denominated in sterling. At 31 December 2023, if interest
rates on sterling denominated borrowings had been 150 basis points higher/lower with all other variables held constant, profit
after tax for the year would have been £291,600 lower/higher, mainly as a result of higher/lower interest expense on floating-rate
borrowings. The directors consider that 150 basis points is the maximum likely change in sterling interest rates over the next
year, being the period up to the next point at which the Group expects to make these disclosures.
Liquidity risk
Liquidity risk arises from the Group’s management of working capital and the finance charges and principal repayments on its
debt instruments. It is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due. The
Group’s policy is to ensure that it will always have sufficient cash (or agreed facilities) to allow it to meet its liabilities when they
become due and to take advantage of business opportunities.
The Board reviews the projected financing requirements annually when agreeing the Group’s budget and receives rolling
12-month cash flow projections for the Group on a regular basis as well as information regarding cash balances.
In December 2023, the Group renewed and extended its existing borrowing facilities with HSBC. The renewed facility which runs
until 31 December 2025, total £24.0 million and consists of a £17.5 million revolving credit facility and a £6.5 million term loan.
The renewed facility replaces the facilities which were due for renewal in April 2024. The interest rate on the renewed facility
will remain the same as for the previous facilities, paying a margin of 2.4% - 3.15% over the Sterling Overnight Index Average
(SONIA), resulting in a current effective rate of 8.3%.
The facility is secured by the debenture which grants first ranking fixed and floating security of the property and assets of the
Group as referenced in Notes 16 and 18.
Additionally, the Group drew down £0.8m from two short term loans that are repayable over two years. At the year end the
Group had £2.3 million in cash, and so a net debt position of £22.9 million (2022: £19.2 million).
At the end of the financial year, cash flow projections indicated that the Group expected to have sufficient liquid resources to
meet its obligations, including scheduled lease payments (Note 17), under all reasonably expected circumstances.
Capital Management
The Group monitors “adjusted capital” which comprises all components of equity (i.e., share capital, share premium,
non-controlling interest and retained earnings).
The Group’s objectives when maintaining capital are:
• to safeguard the entity’s ability to continue as a going concern, so that it can continue to provide returns for shareholders
and benefits for other stakeholders, and
• to provide an adequate return to shareholders by pricing products and services commensurately with the level of risk
Financial Statements 78
5. Segment information
A geographical analysis of revenue is given below:
The Group’s reportable segments are strategic business groups that offer different products and services. Operating segments
are reported in a manner consistent with the internal reporting provided to the chief operating decision maker, which has been
identified as the Board of Directors of RBG Holdings plc.
The following summary describes the operations of each reportable segment:
• Legal services – Provision of legal advice, by RBGLS (trading under two brands, Rosenblatt and Memery Crystal)
• Professional Services – Provision of sell-side M&A corporate finance services, (professional services are provided by
Convex and have been reclassified to discontinued operations, Note 13)
United Kingdom
Europe
North America
Other
79
Revenue by location of clients
2022
£
2022
restated
£
28,976,058
37,960,608
1,838,158
2,514,385
5,881,253
1,528,152
567,170
4,817,978
39,209,854
44,873,908
2023
Segment revenue
Disbursement asset revenue
Disbursement asset expenditure
Segment contribution
Costs not allocated to segments
Personnel costs
Depreciation and amortisation
Other operating expense
Net financial expenses
Group loss for the year before tax on continuing operations
2022 (restated)
Segment revenue
Segment gains on litigation assets comprising:
Proceeds on disposal of damages based assets
Disbursement asset revenue
Disbursement asset expenditure
Segment contribution
Legal services
£
Total
£
39,209,854
39,209,854
1,221,854
(827,834)
1,221,854
(827,834)
17,180,771
17,180,771
(3,569,936)
(3,251,607)
(19,606,277)
(2,118,791)
(11,365,839)
Legal services
£
44,873,908
Third party
participation rights
£
Total
£
- 44,873,908
-
-
2,021,700
2,021,700
2,021,700
2,021,700
2,847,487
(3,241,507)
22,461,803
2,847,487
(3,241,507)
- 22,461,803
Segment gains on litigation assets
-
2,021,700
2,021,700
Costs not allocated to segments
Personnel costs
Depreciation and amortisation
Other operating expense
Net financial expenses
Loss on sale of equity accounted associate
Group profit for the year before tax on continuing operations
(5,035,073)
(3,432,764)
(16,791,399)
(1,319,155)
(21,643)
(2,116,531)
Total assets and liabilities by operating segment are not reviewed by the chief operating decision makers and are
therefore not disclosed.
Revenues from Legal Services clients that account for more than 10% of Group revenue was £5,326,686 (2022: £6,632,334).
Contract assets – work in progress
Group
At 1 January
Transfers in the period from contract assets to trade receivables
Impairment of contract assets
Excess of revenue recognised over cash (or rights to cash) being recognised during the year
At 31 December
2023
£
2022
£
9,703,812
5,976,258
(5,059,785)
(3,039,106)
(733,191)
4,332,502
(412,125)
7,178,785
8,243,338
9,703,812
Contract assets are included within “trade and other receivables” on the face of the statement of financial position. They arise
when the Group has performed services in accordance with the agreement with the relevant client and has obtained right to
consideration for those services, but such income has not been billed at the balance sheet date.
6. Material profit or loss items
The Group has identified a number of items which are material due to the significance of their nature and/or amount. These are
listed separately here to provide a better understanding of the financial performance of the Group.
The below items have been identified as non-underlying and therefore are adjusted for in the calculation of adjusted EBITDA.
Non-underlying items
Costs of acquiring subsidiary
Contract assets - damage based agreement asset impairment
Release of onerous contract provision
Trade receivables – provision against damages based agreement receivable
Costs associated with discontinued operations
Costs associated with re-financing project
Other one-off costs
Trade receivable provision
Restructuring (release)/costs
Note
2023
£
2022
£
A
B
B
C
D
E
F
G
H
25,000
367,303
-
6,670,481
301,727
920,127
5,648,109
787,193
2,081,890
1,038,163
(168,167)
562,979
1,296,470
-
-
-
-
803,631
Financial Statements
80
6. Material profit or loss items (continued)
6a Cost of acquiring subsidiary
Costs associated with the failed acquisition of a subsidiary within 2022. The cost incurred within 2023 relates to additional invoice
received within the year, relating to the project from 2022.
6b Contract assets – damages based agreement impairment
Damages based agreement assets are initially recognised as revenue under IFRS 15 to the extent it is highly probable that a
significant reversal in the amount will not occur in the future and a disbursement asset will be recognised in the balance sheet.
The Group has two cases under damages based agreements.
For the first case, disbursements are recoverable either in the case of a win or where the client or the Group terminate the
agreement. Under IFRS 15, this case is treated as a contract asset and an impairment assessment is performed under IFRS 15.
During the year ended 31 December 2022, the probability of success of this case was reduced from 90% to 50% and the value
of the contract asset at this point in time (£6,670,481) was written off. At this point in time, the contract became onerous and the
Group recognised a provision for costs to fulfil the contract.
6c Trade receivables – provision against damages based agreement
For the second damages based agreement asset that the Group has, the disbursements are recoverable in a win or lose
situation. As such, the revenue recognition point is the point at which the expense is incurred by the Group. IFRS 15 requires the
presentation of any unconditional rights to consideration as a receivable separately from contract assets and an expected credit
loss (ECL) assessment is performed at year end.
As a result of the ECL assessment, the Group has fully provided against the receivable for this damages based agreement.
7. Other operating income
Group
Other income
Bank interest on client monies
8. Disbursement asset revenue/expenditure
Group
Disbursement asset revenue
Disbursement asset expenditure
Costs incurred
Provision (released)/recognised
81
2023
£
-
885,422
885,422
2022
£
159,280
(3,234)
156,046
2023
£
2022
£
1,221,854
2,847,487
1,221,854
(394,020)
2,847,487
394,020
(827,834)
(3,241,507)
The costs relate directly to the contract, the first case met the definition of an onerous contract at the end of 2022, therefore
a provision was made within 2022 for costs to meet the obligations of the contract. During the year ended 31 December
2023, the provision was released against the costs incurred. This case lost during the current year and therefore no asset was
recognised for these costs. The costs associated with the second case were recognised as an asset from costs to fulfil a contract,
this asset was reviewed for ECL and was impaired based on the Group’s assessment that the costs would not be recoverable
from the client.
6d Costs associated with disposal of LionFish
9. Profit from operations and auditor’s remuneration
During the year ended 31 December 2023, the Group disposed of its subsidiary LionFish Litigation. As a result of this disposal,
the Group wrote off a portion of the intercompany balance owed by LionFish.
Additionally, as part of the consideration received for the sale of LionFish, the Group retained Litigation Asset relating to
previous cases which LionFish had invested in and had lost at point of sale, so the remaining balance sheet value associated
with these cases was written off.
6e Costs associated with re-financing project
During the year ended 31 December 2023, the Group carried out and completed a re-financing project which result in the extension
of its existing facilities. The Group engaged with a third-party consultancy Group to assist with the management of this project.
6f Other one-off costs
During the year ended 31 December 2023, the Group has incurred a number of one-off or non-recurring costs, they have been
classified as non-underlying as they do not represent costs incurred in the normal course of business. These costs include legal
fees for settlement claims, costs associated with settlements and public relation costs associated with these settlements.
6g Trade receivables provision – estimate change
During the year ended 31 December 2023, the Group reviewed the accounting estimate for expected credit losses on trade
receivables and determined there was not sufficient coverage. As a result, an amount has been recognised as non-underlying
items that represents the change in provision as at 31 December 2023.
6h Restructuring (release)/costs
During the year ended 31 December 2022, there were restructuring costs incurred by the Group, the release within the year
ended 31 December 2023 represents the portion of the 2022 cost that was not incurred/paid out and therefore required the
accrual to be released.
Profit from operations is stated after charging:
Fees payable to the company’s auditors:
Audit fees
Other services – pursuant to legislation/regulation
Depreciation of property, plant and equipment
Amortisation of right-of-use assets
Amortisation/impairment of intangible assets
2023
£
2022
restated
£
351,765
3,035
484,412
290,000
36,684
530,529
2,028,585
2,064,823
738,610
837,412
For the year ended 31 December 2023, depreciation of property, plant and equipment of £12,091 (2022 restated: £25,874)
was transferred to discontinued operations. Amortisation of right of use assets of £110,332 (2022: £88,762) was transferred to
discontinued operations.
The Alternative Performance Measures used by Management are shown below:
Operating (loss)/profit
Depreciation and amortisation expense
Non-underlying items
Adjusted EBITDA
(Loss)/Profit before tax
Non-underlying items
Adjusted (Loss)/Profit before tax
2023
£
(9,247,048)
3,251,607
10,634,042
2022
restated
£
(775,734)
3,432,764
9,700,864
4,638,601
12,357,894
2023
£
2022
restated
£
(11,635,839)
(2,116,531)
10,634,042
9,700,864
(731,797)
7,584,333
Financial Statements 82
10. Employees
Group
Staff costs (including directors) consist of:
Wages and salaries
Short-term non-monetary benefits
Cost of defined contribution scheme
Share-based payment expense
Social security costs
2023
£
2022
restated
£
19,639,680
20,060,891
265,217
762,278
-
254,585
695,206
6,244
2,394,358
2,619,683
23,061,533
23,636,609
Personnel costs stated in the consolidated statement of comprehensive income includes the costs of contractors of £3,816,927
(2022 restated: £3,547,508).
Staff costs transferred to discontinued operations during the year of £324,474 (2022 restated: £3,654,197)
Contractors’ costs transferred to discontinued operations during the year of £866 (2022 restated: £356,986)
The average number of employees (including directors) during the year was as follows:
Legal and professional staff
Administrative staff
2023
Number
2022
Number
£
136
64
200
£
138
73
211
Defined contribution pension schemes are operated on behalf of the employees of the Group. The assets of the schemes are
held separately from those of the Group in independently administered funds. The pension charge represents contributions
payable by the Group for continuing operations to the funds and amounted to £762,278 (2022 restated: £693,157).
Contributions amounting to £189,132 (2022: £256,340) were payable to the funds at year end and are included in Trade and
other payables.
Company
The average number of employees (excluding directors) during the period was four (2022: nine); all other personnel are
employed by subsidiary undertakings.
Directors’ remuneration payable in the year is set out below:
31 December 2023
M Ismail
P Baker
D Wilkinson
N Davis (appointed 3 Mar 2023)
T MacLeod (appointed 3 Mar 2023)
I Rosenblatt (appointed 27 Jul 2023)
J Divers (appointed 3 Mar 2023)
K McNair (appointed 28 Nov 23)
K Hamill (resigned 22 Jun 2023)
S Drakeford-Lewis (resigned 30 Jun 2023)
N Foulston (terminated 31 Jan 2023)
Basic Salary and/or
Directors Fees
Employer Pension
Contributions
£
85,000
40,000
40,000
288,845
298,254
**
2,258,834
372,593
20,833
45,000
127,500
37,152
3,614,011
£
-
-
-
13,083
8,648
-
12,500
938
-
3,825
-
38,994
Total
£
85,000
40,000
40,000
301,928
306,902
2,258,834
385,093
21,771
45,000
131,325
37,152
3,653,005
** Of this amount, £600,000 remained payable as at 31 December. Ian Rosenblatt subsequently agreed to receive this amount in shares as part of the equity that was announced in February 2024.
10. Employees (continued)
31 December 2022
S Drakeford-Lewis
20
N Foulston (terminated 31 Jan 2023)
K Hamill
M Ismail
R Parker (resigned 31 Dec 2022)
P Baker
D Wilkinson
83
Basic Salary and/or
Directors Fees
Employer Pension
Contributions
£
-
445,820
90,000
40,000
611,000
37,737
37,737
£
-
(333)
-
-
24,000
-
-
Total
£
-
445,487
90,000
40,000
21
635,000
37,737
37,737
1,262,294
23,667
1,285,961
Directors who have an interest in the shares of the Company will benefit through dividend payments.
During the year the following bonuses were received by directors and are included within Basic Salary and/or Directors’ Fees.
J Divers
N Davis
S Drakeford-Lewis
R Parker
31 Dec 2023
22
31 Dec 2022
£
122,593
17,178
25,000
£
-
-
-
-
50,000
Details of the transactions with Directors are included in Note 30. The directors are considered to be the key
management personnel.
11. Finance income and expense
Recognised in profit or loss
Finance income
Interest received on bank deposits
Net finance income recognised in profit or loss
Finance expense
Interest expense on financial liabilities measured at amortised cost
Interest expense on lease liabilities
Net finance (expense) recognised on profit or loss
2023
£
2022
£
51,318
51,318
14,509
14,509
(1,687,122)
(482,987)
(811,352)
(522,311)
(2,170,109)
(1,333,663)
(2,118,791)
(1,319,154)
The above financial income and expense include the following in respect of assets/(liabilities) not at fair value through
profit or loss:
Total interest income on financial assets
Total interest expense on financial liabilities
2023
£
51,318
2022
£
14,509
(1,687,122)
(1,635,804)
(811,352)
(796,843)
20 No remuneration disclosed as S Drakeford-Lewis was appointed on 31 December 2022.
21 £292,500 of the total related to termination payment.
22 Bonuses paid during the year ended 31 December 2023 relate to 31 December 2022 results.
Financial Statements
84
12. Tax expense
Current tax expense
Current tax on profits for the year
Adjustment for under provision in prior years
Total current tax
Deferred tax expense
Origination and reversal of temporary differences in current period (Note 26)
Origination and reversal of temporary differences in prior period (Note 26)
Total tax expense
Tax charge attributable to:
Profit from continuing operations
Profit/(loss) from discontinued operations
Tax expense excluding share of tax of equity accounted associate
2023
2022
restated
£
-
-
-
£
-
(443,490)
(443,492)
(445,317)
(747,939)
-
23,575
(445,317)
(1,167,854)
(322,720)
(122,597)
(469,118)
(698,736)
(455,317)
(1,167,854)
(455,317)
(1,167,854)
The reasons for the difference between the actual tax charge for the period and the standard rate of corporation tax in the
United Kingdom applied to profits for the year are as follows:
(Loss) for the year from:
Continuing operations
Discontinued operations
Income tax expense (including income tax on associate) attributable to:
Continuing operations
Discontinued operations
(Loss) before income taxes
Tax using the Company’s domestic tax rate of 23.5% (2022: 19%)
Fixed asset differences
Expenses not deductible for tax purposes
Income not taxable for tax purposes
Timing differences not recognised in the computation
Adjustments in respect of prior periods
Adjustments in respect of prior periods (deferred tax)
Remeasurement of deferred tax for changes in tax rates
Movement in deferred tax not recognised
Total tax expense
2023
£
2022
restated
£
(11,043,119)
(1,647,413)
(12,875,822)
(3,073,350)
(23,918,941)
(4,720,763)
(445,317)
(322,720)
(122,597)
(1,167,854)
(469,118)
(698,737)
24,364,258
(5,888,617)
(5,725,601)
(1,118,837)
91,463
3,480,519
(350,666)
(42,036)
-
-
(675)
91,370
-
-
8,341
23,575
(32,552)
(171,627)
2,133,556)
-
(445,317)
(1,167,854)
Changes in tax rates and factors affecting the future tax charge
On 1 April 2023, the UK corporation tax rate increased from 19% to 25%. The effect of the new rate on the Group’s tax charge
has been applied to the financial statements.
13. Discontinued operations
Convex Capital Limited
During the year ended 31 December 2023, the Board made the decision to dispose of Convex Capital Limited (“Convex”).
Financial performance and cash flow information
The financial performance and cash flow information presented are for the 12 months ending 31 December 2023 and
31 December 2022
Summary of discontinued operations – reconciliation to profit or loss
85
Revenue
Expenses other than finance costs
Finance costs
Non-underlying items
Impairment of intangible assets
Tax credit
Loss from selling discontinued operations
(Loss) for the year
Reconciliation to statement of cash flows
Net cash (outflow)/inflow from operating activities
Net cash (outflow) from investing activities
Net cash inflow/(outflow) from financing activities
Net (decrease)/increase in cash generated
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
Breakdown of discontinued operations by entity:
Discontinued operations - Convex
Revenue
Expenses other than finance costs
Finance costs
Non-underlying items
Tax credit/(expense)
(Loss)/Profit for the year
Attributable to:
Equity holders of the parent
Cash flow
Net cash (outflow)/inflow from operating activities
Net cash (outflow) from investing activities
Net cash inflow/(outflow) from financing activities
Net (decrease)/increase in cash generated
2023
£
2022
£
2,211,674
956,050
(2,871,945)
(4,609,684)
(43,358)
(6,387)
1,490,928
(112,066)
(13,694,754)
122,597
(90,964)
-
698,737
-
(12,875,822)
(3,073,350)
2023
£
2022
£
(796,422)
1,388,283
(2,586)
(12,964)
482,524
(1,139,753)
(316,484)
423,843
235,566
188,277
107,359
423,843
2023
£
2022
£
2,234,800
5,274,075
(2,539,273)
(4,109,076)
(26,220)
-
122,597
(208,096)
(6,387)
(31,177)
(215,899)
911,536
(208,096)
911,536
2023
£
2022
£
(893,119)
1,396,086
(2,586)
(12,575)
590,626
(1,139,753)
(305,079)
243,758
Financial Statements 86
13. Discontinued operations (continued)
13. Discontinued operations (continued)
87
Assets and liabilities of disposal group held for sale
Financial performance and cash flow information
The following major classes of assets and liabilities in relation to Convex have been classified as held for sale in the consolidated
statement of financial position.
The financial performance and cash flow information presented are for the 12 months ending 31 December 2023 and 31
December 2022.
Property, plant and equipment
Right-of-use assets
Intangible assets
Trade and other receivables
Cash and cash equivalents
Assets held for sale
Trade and other payables
Leases
Amounts due to parent company
Tax liabilities
Liabilities held for sale
2023
£
10,661
544,386
2022
£
21,867
654,718
2,600,000
16,327,834
106,728
107,359
118,582
412,438
3,369,134
17,535,439
240,181
541,610
82,692
93,944
(176,486)
654,452
-
587,799
958,476
1,065,765
Lionfish Litigation Finance Limited
In December 2022, the Board announced its intention to dispose of LionFish Litigation Finance Limited (“LionFish”).
On 12 August 2020, the Company agreed put options over the shares of LionFish held by the non-controlling interest. Under
this agreement, the holder of the shares could require the Company to buy the shares in LionFish, with consideration based
on a multiple of LionFish profits, settled by the issue of ordinary shares in the Company. On 8 December 2022, the minority
shares were transferred to the Group for £nil and this agreement was terminated, during the year ended 31 December 2022
the present value of the put option was released through the Statement of Changes in Equity.
In July 2023 the Group completed its disposal of LionFish to Blackmead Infrastructure Limited.
The post-tax loss on disposal of discontinued operation was determined as follows:
Cash consideration received
Other consideration received
Total consideration received
Cash disposed of
Net cash inflow of disposal of discontinued operation
Net assets disposed (other than cash):
Property, plant and equipment
Trade and other receivables
Litigation assets
Trade and other payables
Pre-tax loss on disposal of discontinued operation
Related tax benefit
Loss on disposal of discontinued operation
31 Dec 23
£
1,074,734
3,782,098
4,856,832
4,000
4,852,832
(742)
(1,136)
(5,603,898)
661,980
(4,943,796)
(90,964)
22,741
(68,223)
Discontinued operations - LionFish
(Loss) on litigation assets
Expenses other than finance costs
Finance costs
Non-underlying items
Tax credit/(expense)
Loss from selling discontinued operation after tax
Profit/(Loss) for the year
Attributable to:
Equity holders of the parent
Non-controlling interests
Cash flow
Net cash inflow/(outflow) from operating activities
Net cash outflow from investing activities
Net cash outflow from financing activities
Net (decrease) in cash generated
2023
£
2022
£
(23,126)
(4,318,025)
(332,672)
(17,138)
1,490,928
-
(90,964)
(500,608)
-
(80,889)
914,635
-
1,027,028
(3,984,887)
1,027,028
(3,599,325)
-
(385,562)
1,027,028
(3,984,887)
2023
£
96,697
-
(108,102)
(11,405)
2022
£
(7,803)
(389)
-
(8,192)
Assets and liabilities of disposal group held for sale
The following major classes of assets and liabilities in relation to LionFish have been classified as held for sale in the consolidated
statement of financial position
Property, plant and equipment
Litigation investments
Trade and other receivables
Cash and cash equivalents
Assets held for sale
Trade and other payables
Amounts due to parent company
Tax liabilities
Liabilities held for sale
2023
£
-
-
-
-
-
-
-
-
2022
£
2,770
5,331,698
1,244
11,405
5,347,117
1,283,883
4,766,624
412,551
6,463,058
Financial Statements 88
14. Earnings per share
Numerator
Profit for the year and earnings used in basic and diluted EPS:
From continuing operations
From discontinued operations
Non-Underlying items
Costs of acquiring subsidiary
Contract assets - damage based agreement asset impairment
Release of onerous contract provision
Trade receivables – provision against damages based agreement receivable
Group costs associated with discontinued operations
Costs associated with refinancing project
Other one-off costs
(Release)/accrual of restructuring costs
Trade receivable provision change
Less: tax effect of above items
Profit for the year adjusted for non-underlying items from continuing operations
Denominator
Weighted average number of shares used in basic EPS
Impact of share options
Weighted average number of shares used in diluted EPS
Basic earnings per ordinary share from continuing operations
Diluted earnings per ordinary share from continuing operations
Basic earnings per ordinary share from discontinued operations
Diluted earnings per ordinary share from discontinued operations
Basic earnings per ordinary share from total operations
Diluted earnings per ordinary share from total operations
Basic earnings per ordinary share adjusted for non-underlying items from continuing operations
Diluted earnings per ordinary share adjusted for non-underlying items from continuing operations
Total
2023
£
Total
2022
Restated
£
(11,043,118)
(1,647,413)
818,932
(2,687,789)
25,000
367,303
-
6,670,481
301,727
920,127
5,648,109
787,193
2,081,890
(168,167)
1,038,163
562,979
1,296,470
-
-
-
803,631
-
(2,658,511)
(1,824,410)
(3,067,586)
6,229,042
2023
2022
Number
Number
95,331,236
95,331,236
188,392
188,392
95,519,628
95,519,628
2023
Pence
(11.58)
(11.58)*
0.86
0.86
(25.09)
(25.09)*
(3.22)
(3.22)*
2022
Restated
Pence
(1.73)
(1.73)*
(2.82)
(2.82)*
(4.55)
(4.55)*
6.53
6.52
On 22 February and 12 March 2024, the Group issued shares of 9,533,125 and 23,814,521 respectively. Following the Second
Admission (12 March 2024), it issued share capital comprised 128,678,882 shares.
Earnings per share have been recalculated based on a weighted average of the number of shares at 31 December 2023 and
following the Second Admission on 12 March 2024.
Denominator
Weighted average number of shares used in basic EPS
Impact of share options
Weighted average number of shares used in diluted EPS
Number
112,005,059
188,392
112,193,451
14. Earnings per share (continued)
Basic earnings per ordinary share from continuing operations
Diluted earnings per ordinary share from continuing operations
Basic earnings per ordinary share from discontinued operations
Diluted earnings per ordinary share from discontinued operations
Basic earnings per ordinary share from total operations
Diluted earnings per ordinary share from total operations
Basic earnings per ordinary share adjusted for non-underlying items from continuing operations
Diluted earnings per ordinary share adjusted for non-underlying items from continuing operations
15. Dividends
Interim dividend of 0.5p (2022: 3p) per ordinary share proposed
and paid during the year relating to the previous year’s results
Interim dividend of nil (2022: 2p) per ordinary share paid during the year
* The potentially dilutive instruments were anti-dilutive during 2022 and 2023.
16. Property, plant and equipment
Group
89
2023
Pence
(9.86)
(9.84)
0.73
0.73
(21.36)
(21.32)
(2.74)
(2.73)
2023
£
2022
£
471,702
2,832,898
-
1,903,173
471,702
4,736,071
Leasehold
improvements
Fixtures and
fittings
Computer
Equipment
Cost
At 1 January 2022
Additions
Transferred to assets held for sale
At 31 December 2022 (restated)
At 1 January 2023 (restated)
Additions
At 31 December 2023
Accumulated depreciation and impairment
At 1 January 2022
Charge for the period
Transferred to assets held for sale
At 31 December 2022 (restated)
At 1 January 2023 (restated)
Charge for the year
At 31 December 2023
Net book value
At 1 January 2022
At 31 December (restated)
At 31 December 2023
£
2,710,279
7,471
(20,197)
2,697,553
2,697,553
-
2,697,553
487,148
285,370
(17,216)
755,302
755,303
246,723
1,002,026
2,223,131
1,942,250
1,695,527
£
251,294
87,883
(10,602)
328,575
328,575
3,713
332,288
116,989
109,399
(7,847)
218,541
218,540
89,439
307,979
134,305
110,035
24,309
£
779,546
103,998
(56,552)
826,992
826,992
320,314
Total
£
3,741,119
199,352
(87,351)
3,853,120
3,853,120
324,027
1,147,306
4,177,147
554,071
157,536
(40,421)
671,186
671,186
148,250
819,436
225,475
155,806
327,870
1,158,208
552,305
(65,484)
1,645,029
1,645,029
484,412
2,129,441
2,582,911
2,208,091
2,047,706
Property, plant and equipment transferred to held for sale at 31 December 2023 of £10,661 (2022: £24,637).
The Group has no contractual commitments for the acquisition of property, plant and equipment.
Financial Statements 90
16. Property, plant and equipment (continued)
Company
Cost
At 1 January 2022
Additions
At 31 December 2022
At 1 January 2023
Additions
At 31 December 2023
Accumulated depreciation and impairment
At 1 January 2022
Charge for the year
At 31 December 2022
At 1 January 2023
Charge for the year
At 31 December 2023
Net book value
At 1 January 2023
At 31 December 2023
Computer Equipment
£
18,750
-
18,750
18,750
-
18,750
17,667
1,038
18,705
18,705
45
18,750
45
-
Total
£
18,750
-
18,750
18,750
-
18,750
17,667
1,038
18,705
18,705
45
18,750
45
-
Under a debenture signed and registered on 19 April 2021, HSBC UK Bank plc have a fixed charge over the property, plant and
equipment of the Group.
The Company has no contractual commitments for the acquisition of property, plant and equipment.
17. Leases
The Group leases its business premises in the United Kingdom. The lease contracts either provide for annual increases in the
periodic rent payments linked to inflation or for payments to be reset periodically to market rental rates.
The percentages in the table below reflect the current proportions of lease payments that are either fixed or variable. The
sensitivity reflects the impact on the carrying amount of lease liabilities and right-of-use assets if there was an uplift of 5% on the
balance sheet date to lease payments that are variable.
At 31 December 2023
Property leases with payments linked to inflation
Property leases with periodic uplifts to market rentals
Lease
Contract
Number
1
1
2
Variable
Payments
%
38.7%
61.3%
100.0%
Sensitivity
£000
+/- 174
+/- 574
+/- 748
The percentages in the table below reflect the proportions of lease payments that are either fixed of variable for the
comparative period.
At 31 December 2022
Property leases with payments linked to inflation
Property leases with periodic uplifts to market rentals
Lease
Contract
Number
1
1
2
Variable
Payments
%
78.3%
21.7%
100.0%
Sensitivity
£000
+/- 218
+/- 653
+/- 872
17. Leases (continued)
Right-of-use Assets
At 1 January 2022
Amortisation
Variable lease payment adjustment
Transferred to assets held for sale
At 31 December 2022 (restated)
At 1 January 2023
Amortisation
At 31 December 2023
Lease liabilities
At 1 January 2022
Interest expense
Variable lease payment adjustment
Lease payments
Transferred to assets held for sale
At 31 December 2022 (restated)
At 1 January 2023
Interest expense
Lease payments
At 31 December 2023
At 31 December 2023, lease liabilities were falling due as follows:
91
Land and buildings
£
Total
£
15,913,008
15,913,008
(2,153,585)
(2,153,585)
1,314,709
(654,718)
1,314,709
(654,718)
14,419,414
14,419,414
14,419,414
14,419,414
(2,028,522)
(2,028,522)
12,390,892
12,390,892
Land and buildings
£
Total
£
15,849,101
15,849,101
528,698
1,314,709
528,698
1,314,709
(1,740,524)
(1,740,524)
(258,474)
(258,474)
15,693,510
15,693,510
15,693,510
15,693,510
472,410
472,410
(2,596,779)
(2,596,779)
13,569,141
13,569,141
Group
Lease liabilities
Up to 3
months
Between 3
and 12 months
Between 1
and 2 years
Between 2
and 5 years
£
£
£
Over
5 years
£
Total
£
1,677,528
2,318,301
4,183,776
4,842,691
13,569,141
£
546,845
The aggregate undiscounted commitments for low-value leases as at 31 December 2023 was £nil (2022: £nil).
Financial Statements 92
18. Intangible assets
Group
Cost
At 1 January 2022
Additions
Transferred to assets held for sale
At 31 December 2022 (restated)
At 1 January 2023
Additions
At 31 December 2023
Accumulated amortisation and impairment
At 1 January 2022
Amortisation charge
Transferred to assets held for sale
At 31 December 2022
At 1 January 2023
Amortisation charge
At 31 December 2023
Net book value
At 1 January 2022
At 31 December 2022 (restated)
At 31 December 2023
Goodwill
£
Customer
Contracts
£
Brand
£
Other
£
Total
£
51,862,168
1,706,578
3,360,474
1,000,000
57,929,220
-
(15,775,039)
36,087,129
-
(1,167,673)
538,905
-
(661,596)
2,698,878
-
-
-
(17,604,308)
1,000,000
40,324,912
36,087,129
538,905
2,698,878
1,000,000
40,324,912
-
-
-
36,087,129
538,905
2,698,878
2,500,000
3,500,000
2,500,000
42,824,912
-
-
-
-
-
-
-
1,466,599
169,389
(1,167,673)
468,315
468,315
70,590
538,905
270,058
168,024
(108,801)
329,281
329,281
134,940
464,221
333,333
500,000
-
833,333
833,333
500,000
2,069,990
837,413
(1,276,474)
1,630,929
1,630,929
705,530
1,333,333
2,336,459
51,862,168
36,087,129
36,087,129
239,979
70,590
-
3,090,416
2,369,597
2,234,657
666,667
166,667
55,859,230
38,693,983
2,166,667
40,488,453
Under a debenture signed and registered on 19 April 2021, HSBC UK Bank plc have a fixed charge over the intangible assets
of the Group.
During the year, intangible assets with an opening net book value of £16,327,834 relating to Convex Capital were transferred to
assets held for sale. Further amortisation of £33,080 was charged to these intangible assets during the year ended 31 December
2023. An impairment assessment was performed on these intangible assets where it was determined that an impairment of
£13,694,754 was required.
19. Impairment of goodwill and other intangible assets
The Group is required to test, on an annual basis, whether goodwill and other intangible assets have suffered any impairment.
The recoverable amounts are determined based on value in use calculations. The use of this method requires the estimation
of future cash flows and the determination of a discount rate in order to calculate the present value of the cash flows. The
recoverable amounts were determined to be higher than the carrying amounts and so no impairment losses were recognised.
The recoverable amounts have been determined from value in use calculations based on an extrapolation of the cash flow
projections from the formally approved budget. Values assigned to the key assumptions represent management’s estimate of
expected future trends and are as follows:
• A pre-tax discount rate of 25% was applied in determining the recoverable amount. The discount rate is based on
the average weighted cost of capital
• Growth rates over the longer term of between 0-3% are based on management’s understanding of the market
opportunities for services provided
• Increases in costs are based on current inflation rates and expected levels of recruitment needed to generate
predicted revenue growth
• Cash flows have been assessed over ten years with the assumption that the business will be ongoing at the end
of that period
The review demonstrated sufficient headroom such that the estimated carrying values from continuing operations are not
sensitive to changes in assumptions. Having reviewed the key assumptions used, the Directors do not believe that there is a
reasonably possible change in any of the key assumptions that require further disclosure.
An impairment in relation to Convex Capital goodwill and intangible assets was made during the financial year.
20. Subsidiaries
The principal subsidiaries of RBG Holdings plc, which are incorporated in England and Wales and have been included in these
consolidated financial statements, are as follows:
93
Name
RBL Law Limited
RBG Legal Services Limited
Convex Group (Holdings) Limited
Convex Capital Limited
LionFish Litigation Finance Limited
23
Islero Assignments Limited
Memery Crystal Limited
Rosenblatt Limited
Principal
Activity
Registered
Number
Proportion of
ownership interest
Legal Services
Legal Services
Holding Company
Professional Services
Litigation Finance
Dormant
Dormant
Dormant
09986118
13287062
11490871
11491052
12165991
12754244
13600674
13601148
2023
100%
100%
100%
100%
-
-
100%
100%
2022
100%
100%
100%
100%
100%
100%
100%
100%
The principal place of business of Convex Group (Holdings) Limited and Convex Capital Limited is Bass Warehouse, 4 Castle
Street, Manchester, M3 4LZ. The principal place of business and registered office of RBG Legal Services Limited is 165 Fleet
Street, London, England, EC4A 2DY. The principal place of business of the other subsidiaries and the registered address of each
subsidiary is 165 Fleet Street, London, England, EC4A 2DY.
For the year ending 31 December 2023, the principal subsidiary companies, set out above, were exempt from the requirements
of the Companies Act relating to the audit of individual accounts by virtue of section 479A of the Companies Act 2006. RBG
Holdings plc, has given a statement of guarantee under the Companies Act 2006 section 479C, whereby RBG Holdings plc will
guarantee all outstanding liabilities to which the respective subsidiary companies are subject as at 31 December 2023.
Company
Cost and net book value
At 1 January
Investments in subsidiaries
Impairment in subsidiary held for sale
At 31 December
2023
£
2022
£
27,501,278
27,501,278
-
(13,694,754)
13,806,624
100
-
27,501,378
Impairment in subsidiary held for sale relates to Convex Capital Limited which was classified as a discontinued operation at
31 December 2023 and subsequently sold in March 2024.
This impairment has been arrived at by reviewing intangible assets held in Convex, less consideration received.
21. Investments in associate
In June 2022, the Group sold its 40% interest in Adnitor Limited. The post-tax loss on disposal of investment in associate
was determined as follows:
Cash consideration received
Total consideration received
Net assets disposed (other than cash):
Investment in associate
Loss on disposal of discontinued operation, net of tax
2023
£
-
-
-
-
2022
£
80,000
80,000
101,643
(21,643)
23 LionFish Litigation Finance Limited was sold in July 2023.
Financial Statements
94
22. Trade and other receivables
Group
Trade receivables
Less: provision for impairment of trade receivables
Trade receivables – net
Contract assets
Amounts due from discontinued operations
Corporation tax receivable
Other taxes and social security
Other receivables
Group
31 Dec 2023
Group
31 Dec 2022
Restated
Group
1 Jan 2022
Restated
£
£
£
14,131,346
12,229,829
10,456,340
(6,170,819)
(2,315,087)
(828,694)
7,960,527
9,914,742
9,627,646
8,243,338
9,703,812
12,378,702
82,692
725,723
-
4,766,624
656,982
-
760,081
-
-
1,068,361
659,347
1,003,079
Total financial assets other than cash and cash equivalents classified as amortised cost
18,080,641
25,701,508
23,769,508
Prepayments
1,019,834
2,170,051
1,963,850
Total trade and other receivables
19,100,475
27,871,559
25,733,358
Due within one year or less
Due after more than one year
19,100,475
27,871,559
19,330,914
-
-
6,402,444
19,100,475
27,871,559
25,733,358
At 31 December 2023, trade and other receivables of £106,728 (2022: £119,806) were transferred to assets held for sale –
discontinued operations.
Trade receivables are made up of the following:
a
Trade receivables for legal services revenue
b
Trade receivables for damages based agreement
Group
31 Dec 2023
Group
31 Dec 2022
Group
1 Jan 2022
£
£
£
11,641,655
10,660,265
10,183,246
2,489,691
1,569,564
273,094
14,131,346
12,229,829
10,456,340
a Trade receivables from legal services revenue relates to balances due on work invoiced for the supply of legal services.
b Trade receivables for damages based agreement relates to a case the Group has entered into and the disbursements are
recoverable from the client whether the case wins or loses. At each reporting date, an ECL assessment is performed on the
asset in line with IFRS 9 and an impairment is recognised as appropriate.
The Group have performed an ECL assessment at each year end and have determined that in the event of a loss, the
disbursements are not recoverable and have therefore impaired the asset.
Contract assets are made up of the following:
a
Work in progress
b
Damages based agreement assets
Group
31 Dec 2023
Group
31 Dec 2022
Group
1 Jan 2022
£
£
8,243,338
9,703,812
-
-
£
5,976,258
6,402,444
8,243,338
9,703,812
12,378,702
a Work in progress relates to time recorded by fee earners that has not been billed at balance sheet date.
b Where revenue is subject to alternative billing arrangements, including services provided under Damages based agreements
(DBAs) the Group recognises an asset for the disbursements on these cases. The Group has two cases that fall under damages
based agreements.
For the first case, disbursements are recoverable either in the case of a win or where the client or the Group terminate the
agreement. Under IFRS 15, this case is treated as a contract asset and an impairment assessment is performed under IFRS 15.
During the year ended 31 December 2022, the probability of success was reduced from 90% to 50%, at this point, the case
became an onerous contract and costs to fulfil the contract were provided for.
22. Trade and other receivables (continued)
The table below provides analysis of the movements in damages based agreement asset.
At 1 January
Additions
Realisations
Write off of damages based agreement asset
At 31 December
95
2023
£
-
-
-
-
-
2022
Restated
£
6,402,444
988,037
(720,000)
(6,670,481)
-
The carrying value of trade and other receivables classified at amortised cost approximates fair value.
The Group does not hold any collateral as security.
The Group applies the IFRS 9 simplified approach to measuring expected credit losses using a lifetime expected credit loss
provision for trade receivables and contract assets. To measure expected credit losses on a collective basis, trade receivables
and contract assets are grouped based on similar credit risk and aging. The contract assets have similar risk characteristics to the
trade receivables for similar types of contracts.
The expected loss rates are based on the Group’s credit losses experienced over the period since incorporation, adjusted for
current and forward-looking information on macroeconomic factors affecting the Group’s customers. The Group has identified
the gross domestic product (GDP), unemployment rate and inflation rate as the key macroeconomic factors in the countries
where the Group operates.
The lifetime expected credit loss provision for trade receivables and contract assets is as follows:
31 December 2023
Expected loss rate
Current
More than 30
days past due
More than 60
days past due
More than 120
days past due
Total
£
18.0%
3.9%
7.9%
7.9%
Gross carrying amount – trade receivables
2,536,027
1,247,100
1,664,689
6,193,839
11,641,655
Gross carrying amount – contract assets (Work in Progress)
8,243,338
Gross carrying amount – trade receivables – DBA assets
2,489,691
-
-
-
-
-
-
8,243,338
2,489,691
Loss provision
2,507,392
48,029
131,270
3,484,129
6,170,819
Current
More than 30
days past due
More than 60
days past due
More than 120
days past due
Total
£
31 December 2022
Expected loss rate
Gross carrying amount – trade receivables
10.2%
2.7%
4,733,325
1,832,694
Gross carrying amount – contract assets (Work in Progress)
9,703,812
Gross carrying amount – trade receivables – DBA assets
1,569,564
-
-
3.8%
820,647
-
-
18.6%
3,273,600
10,660,265
-
-
9,703,812
1,569,564
Loss provision
1,626,725
49,528
30,947
607,887
2,315,087
None of the trade receivables and contract assets have been subject to a significant increase in credit risk since initial recognition.
Movements in the impairment allowance for trade receivables are as follows:
At 1 January
Increase during the year
Receivable written off during the year as uncollectible
Unused amounts reversed
At 31 December
2023
£
2,315,087
4,008,754
(62,595)
(90,427)
2022
£
828,694
1,544,896
(24,247)
(34,257)
6,170,820
2,315,087
Included in other receivables is £17,872 (2022: £12,475) which is owed by the Employee Benefit Trust.
Financial Statements 96
22. Trade and other receivables (continued)
Company
Amounts due from group companies
Corporation tax receivable
Other taxes and social security
Other receivables
2023
£
2022
£
43,934,885
53,167,678
145,364
347,822
361,110
-
-
403,633
Total financial assets other than cash and cash equivalents classified as amortised cost
44,789,181
53,571,311
Prepayments
Total trade and other receivables
Due within one year or less
Due after more than one year
162,318
187,224
44,951,499
53,758,535
4,539,382
40,412,117
14,204,102
39,554,433
44,951,499
53,758,535
The loans due from RBG Legal Services and LionFish Litigation Finance are on demand and interest free.
Management considers that there is no increase in credit risk on the related party loans. Given that the loans are on demand,
lifetime credit losses and 12-month credit losses will be the same. Having considered different recoverability scenarios which
incorporated macroeconomic information (such as market interest rates and growth rates), current and forward-looking
information, management consider the expected credit losses to be close to nil.
23. Trade and other payables
Trade payables
Corporation tax payable
Other taxes and social security
Amounts due to discontinued operations
Amounts due to group companies
Derivative financial liabilities
Other payables
Accruals
At 31 December
Due within one year or less
Due after more than one year
Group
2023
£
Company
2023
£
Group
2022
restated
£
4,911,641
547,550
3,927,448
-
-
-
2,318,419
-
100
-
2,260,424
647,324
-
-
100
-
2,194,073
-
-
-
108,261
4,379,510
11,593,485
Company
2022
£
-
-
-
2,873,359
-
100
1,353,193
4,219,262
2,807,158
9,642,454
1,417,342
4,290,801
11,593,485
4,219,262
9,642,454
4,290,801
-
-
-
-
11,593,485
4,219,262
9,642,454
4,290,801
The carrying value of trade and other payables classified as financial liabilities measured at amortised cost approximates fair value.
At 31 December, trade and other payables of £334,175 (2022 restated: £2,107,747) were transferred to liabilities held for sale –
discontinued operations (refer to note 13).
24. Loans and borrowings
The book value and fair value of loans and borrowings which are all denominated in sterling are as follows:
97
Non-current
Bank loans
Secured
Current
Bank loans
Secured
At 31 December
Book value
31 Dec 23
Fair value
31 Dec 23
Book value
31 Dec 22
Fair value
31 Dec 22
£
£
£
£
22,687,488
22,687,488
20,000,000
20,000,000
2,624,407
2,624,407
2,205,640
2,205,640
25,311,894
25,311,894
22,205,640
22,205,640
The rate at which Sterling denominated loans and borrowings are payable is 3.15% above SONIA (2022: 2.90%).
The bank loans are secured by fixed and floating charges over the assets of the Group. The bank loans are repayable over four
years, during the year ending 31 December 2023, the Group signed an amendment and restatement deed which postponed
the termination date. The Group has £nil undrawn committed borrowing facilities available at 31 December 2023 (2022: £nil).
25. Provisions
Group
At 1 January 2022
Charged to profit or loss
(Released) through profit or loss
At 31 December 2022
At 1 January 2023
(Release) through profit or loss
At 31 December 2023
Due within one year or less
Due after more than one year
Leasehold
dilapidations
£
150,000
-
-
Legal
disputes
£
164,291
47,245
-
150,000
211,536
150,000
-
150,000
-
150,000
150,000
211,536
(136,536)
75,000
75,000
-
75,000
Onerous
contracts
£
-
956,999
(562,979)
394,020
394,020
(394,020)
-
-
-
-
Total
£
314,291
1,004,244
(562,979)
755,556
755,556
(530,556)
225,000
75,000
150,000
225,000
Leasehold dilapidations relate to the estimated cost of returning a leasehold property to its original state at the end of the lease in
accordance with the lease terms. The main uncertainty relates to estimating the cost that will be incurred at the end of the lease.
The Group is currently involved in a number of legal disputes. The amount provided represents the directors’ best estimate of
the Group’s liability having taken legal advice. Uncertainties relate to whether claims will be settled out of court or if not whether
the Group is successful in defending any action. Because of the nature of the disputes, the directors have not disclosed further
information on the basis that they believe that this would be seriously prejudicial to the Group’s position in defending the cases
brought against it.
The Group recognises a contract asset in line with IFRS 15 for one of its damages based agreement cases. Management
re-assessed the probability of success of the case based on the information available at the time and the probability of
success was reduced from 90% to 50% during the year ended 31 December 2022 and the contract asset associated with
this was impaired. At this point in time, the case became an onerous contract and as such, a provision was made for costs
to fulfil the contract.
Financial Statements 98
26. Deferred tax
Deferred tax is calculated in full on temporary differences under the liability method using a tax rate of 25% (2022: 25%).
On 1 April 2023 the UK corporate tax rate increased from 19% to 25%. As IFRS requires deferred tax to be measured at tax
rates that have been substantively enacted at the reporting date, the Group’s deferred tax balances have been re-measured
accordingly and the impact has been reflected within the consolidated financial statements.
The movement on the deferred tax account is as shown below:
At 1 January
Recognised in profit or loss
Tax expense
Transferred to held for sale – discontinued operations
At 31 December (asset)/liability
Group
2022
£
Company
2022
£
Group
Restated
£
Company
£
229,361
635,333
729,985
660,270
(323,209)
(122,597)
(216,445)
(435,828)
-
199,505
(682,668)
182,044
229,361
(24,937)
-
635,333
Details of the deferred tax liability and amounts recognised in the profit or loss are as follows:
Group
Balance 1 January 2022
Charges/(credited) to profit or loss
Transferred to held for sale – discontinued operations
Balance 31 December 2022
Balance 1 January 2023
Charges/(credited) to profit or loss
Transferred to held for sale – discontinued operations
Balance 31 December 2023
Company
Balance 1 January 2022
Charges/(credited) to profit or loss
Balance 31 December 2022
Balance 1 January 2023
Charges/(credited) to profit or loss
Balance 31 December 2023
27. Share capital
Accelerated
capital
allowances
Business
combinations
Other temporary
and deductible
differences
£
55,230
1,657
103,683
160,570
160,570
52,003
(489)
212,084
£
832,599
(84,353)
-
£
(37,787)
(641,668)
-
748,246
(679,455)
748,246
(322,993)
-
(679,455)
(174,327)
-
425,253
(853,782)
Accelerated
capital
allowances
Business
combinations
Other temporary
and deductible
differences
£
270
(260)
10
10
-
10
£
660,000
-
660,000
660,000
-
660,000
£
-
(24,677)
(24,677)
(24,677)
(435,828)
(460,505)
Total
£
850,042
(724,364)
103,683
229,361
229,361
(445,317)
(489)
(216,445)
Total
£
660,270
(24,677)
635,333
635,333
(435,828)
199,505
2023
Number
Authorised
2023
£
2022
Number
2022
£
Ordinary shares of 0.2p each
95,331,236
190,662
95,331,236
190,662
Ordinary shares of 0.2p each
At 1 January
Other issues for cash during the year
At 31 December
Allotted, issued and fully paid
2023
Number
2023
£
2022
Number
2022
£
95,331,236
190,662
95,331,236
190,662
-
-
-
-
95,331,236
190,662
95,331,236
190,662
Ordinary shares rank equally as regards to dividends, other distributions and return on capital. Each ordinary share carries the
right to one vote.
99
28. Reserves
Financial instruments issued by the Group are classified as equity only to the extent that they do not meet the definition of a
financial liability or financial asset.
The following describes the nature and purpose of each reserve within equity:
Risk description and impact
Description and purpose
Share capital
Share premium
Retained earnings
Amount subscribed for share capital at nominal value.
Amount subscribed for share capital in excess of nominal value less transaction costs.
All other net gains and losses and transactions with owners (e.g., dividends) not recognised elsewhere.
29. Share-based payment
The Group operates two equity settled share-based remuneration schemes: a United Kingdom tax authority approved scheme
and an unapproved scheme. Under the schemes the only vesting condition is that the individual remains an employee of the
Group over the vesting period.
Outstanding 1 January
Granted during the year
Forfeited during the year
Exercised during the year
2023
Weighted average
exercise price
£
-
-
-
-
2023
Number
285,953
-
-
-
Outstanding at 31 December
0.36
285,953
2022
Weighted average
exercise price
£
-
0.11
0.04
-
0.35
2022
Number
153,437
1,264,977
(1,132,461)
-
285,953
The exercise price of options outstanding at 31 December 2023 ranged between £nil and £1.05 (2022: £nil and £1.03) and their
weighted contractual life was 8 years (2022: 9 years). Of the total number of options outstanding at 31 December 2023, 23,437
had vested and were exercisable (2022: 20,000). No options were exercised in the year. No options were granted during the
year (2022: fair value of each option granted was £0.92).
No options were granted during the year ended 31 December 2023, The following information is relevant in the determination
of the fair value of options granted during the year ended 31 December 2022 under the equity settled share-based
remuneration schemes operated by the Group.
Option pricing model used
Weighted average share price at date of grant
Contractual life (in days)
Expected volatility
Expected dividend yield
Risk-free interest rate
2022
Black-Scholes
£1.18
3,653
24%
5%
1%
The share-based remuneration expense disclosed in Note 10 relates entirely to equity settled schemes. The Group did not enter
into any share-based payment transactions with parties other than employees during the year.
Financial Statements 100
30. Related party transactions
Group
31. Notes supporting statement of cash flows
Non-cash transactions from financing activities are shown in the reconciliation of liabilities from financing transactions below:
101
During the year, Group companies entered into the following transactions with related parties who are not members of the Group:
Related party
Velocity Venture Capital Ltd
24
Motorsport Circuit Management Ltd
24
25
N Davis
SEC Newgate
26
Oliver Rosenblatt
Senbla Limited
27 28
Winros
Supply of
services 2023
Purchase of
services 2023
Supply of
services 2022
Purchase of
services 2022
£
-
-
654
13,323
1,534
668
-
£
-
-
-
315,920
-
-
3,229,543
£
(713)
11,250
-
-
-
-
-
£
222,733
-
-
-
-
-
794,458
In addition, at 31 December 2023, the Group owed £375,000 to Nicola Foulston as part of the settlement agreement (total
settlement was £500,000, £125,000 was paid before year end).
In addition, during the year, £8,687 of contingent work was performed by the Group in relation to a Conditional Fee Agreement
with Winros (2022: £19,480), total work in progress at year end was £527,098 with unbilled disbursements of £209,457.
During the year ended 31 December 2023, Ian Rosenblatt’s restrictive covenant was extended for an additional 5 years for a
value of £2,500,000, at year end, £1,241,665 was still outstanding.
At 31 December, amounts due to related parties were as follows:
SEC Newgate
Winros
At 31 December, amounts due from related parties were as follows:
SEC Newgate
25
N Davis
Senbla Limited
2023
£
150,620
102,412
2023
£
5,285
163
668
2022
£
-
-
2022
£
-
-
-
Sales and purchase of services to related parties were conducted on an arm’s length basis on normal trading terms.
Total remuneration of Key Management Personnel during the year was £3,653,005 (2022: £1,285,916). Further details of
directors’ remuneration are given in the Directors’ Report on pages 42 to 45.
Company
In addition to the amounts disclosed in the Directors’ Report on pages 42 to 45, the Company has entered into the following
transactions with related parties.
During 2023, the Company reimbursed fees and expenses paid on its behalf by RBGLS totalling £642,109 (2022: £2,571,884).
At 31 December 2023, the company was owed £43,532,103 by RBGLS (2021: £48,401,054) and owed £2,318,419 to RBL Law
(2022: £2,226,035).
During 2023, Convex Capital Limited reimbursed fees and expenses paid on its behalf by the Company totalling £887,016
(2022: £571,264). At 31 December 2023, the company was owed £82,692 by Convex Capital Limited (2022: £647,324 owed to
Convex Capital Limited).
During 2023, LionFish Litigation Finance Limited reimbursed fees and expenses paid on its behalf by the Company totalling
£564,203 (2022: £1,067,602). At 31 December 2023, there were no amounts owing to or from LionFish Litigation Finance
Limited (2022: £4,766,624 owed by LionFish Litigation Finance Limited).
At 1 January 2022
Cash flows (net)
Non-cash flows
Interest accruing in year
At 31 December 2022
At 1 January 2023
Cash flows (net)
Non-cash flows
Interest accruing in year
At 31 December 2023
Non-current loans
and borrowings
Current loans
and borrowings
£
17,000,000
3,000,000
£
2,129,592
-
Total
£
19,129,592
3,000,000
-
76,048
76,048
20,000,000
2,205,640
22,205,640
20,000,000
2,687,488
2,205,640
(156,425)
22,205,640
2,531,063
-
575,191
575,191
22,687,488
2,624,406
25,311,894
32. Restatement of prior year
The 2022 comparatives have been restated in these financial statements to include the effect of the adjustments as stated in
Note 2. The following table presents the impact of these restatements.
Restatement to 2022 opening balances
Non-current assets
Trade and other receivables
29
Equity
Retained earnings
Restatement to 2022 statement of comprehensive income:
Gains on litigation assets
Disbursement asset revenue
Disbursement asset expenditure
Non-underlying items:
Contract assets - damage based agreement asset impairment
Release of onerous contract provision
Trade receivables – provision against damages based agreement receivable
31 Dec 2021
As originally
presented
Adjustment (i)
1 Jan 2022
Restated
£
£
£
6,675,538
(273,094)
6,402,444
11,113,365
(273,094)
10,840,271
31 Dec 2022
As originally
presented
Adjustment (i)
31 Dec 2022
Restated
£
£
£
3,821,700
(1,800,000)
2,021,700
-
-
-
-
-
2,847,487
2,847,487
(3,241,507)
(3,241,507)
(6,670,481)
(6,670,481)
(562,979)
(562,979)
(1,296,470)
(1,296,470)
Tax expense
1,932,586
(2,401,704)
(469,118)
Breakdown of tax adjustment
Transferred to assets held for sale (Note 13)
Restatement (i)
(215,898)
(2,185,806)
(2,401,704)
24 A company controlled by Nicola Foulston.
25 Invoice raised during 2023, relating to services supplied during 2022, invoice paid post year end.
26 Included within purchase of services is £103,920 relating to non-underlying items.
27 A partnership in which Ian Rosenblatt is a partner.
28 Included within purchase of services is £209,456 relating to disbursements.
29 Damages based agreements originally presented as “litigation assets”.
Financial Statements
31 Dec 2022
As originally
presented
Adjustment (i)
31 Dec 2022
Restated
£
-
8.18
8.17
4.41
4.40
£
-
(9.91)
(9.89)
(8.96)
(8.94)
£
-
(1.73)
(1.72)
(4.55)
(4.54)
31 Dec 2022
As originally
presented
Adjustment (i)
1 Jan 2023
Restated
£
£
10,603,024
(10,603,024)
£
-
(211,536)
(1,601,655)
(394,020)
2,258,637
(605,556)
656,983
(744,328)
514,967
(229,361)
11,996,470
(8,811,238)
999,426
690,559
1,568,079
2,258,637
(102,760)
617,727
514,967
103
32. Restatement of prior year (continued)
(i) A prior period adjustment has been made for incorrect accounting policies that were previously adopted in relation to
disbursements incurred on two damages based agreements.
The disbursements were previously held on the balance sheet as Litigation Assets and measured the assets under IFRS 9 at fair
value through profit and loss.
Based on the substances of the underlying agreements for the two damages based agreements, the recovery from the client of
disbursements represents a revenue stream arising from a costs to fulfil a contract with a customer and therefore falls within the
scope of IFRS 15.
For the first case, the disbursements are payable to the Group, only if the case wins or where the client or the Group terminates
the engagement. Under IFRS 15, this case is treated as a contract asset and an impairment assessment is performed under
IFRS 15. Management have reassessed the probability of success in this case and determined that during the year ended 31
December 2022, the probability of success reduced from 90% to 50%, this reassessment is based on the information available at
that point in time, hindsight was not applied when making this reassessment. The reduction in the probability of success resulted
in a write off of the contract asset at that time.
Additionally, the reduction in probability of success from 90% to 50% resulted in this case becoming an onerous contract and as
such, the costs to fulfil the contract were provided for.
For the second case, the disbursements are recoverable in a win or lose situation. As such, the revenue recognition point
is the point at which the expense is incurred by the Group. IFRS 15 requires the presentation of any unconditional rights to
consideration as a receivable separately from contract assets and an expected credit loss (ECL) assessment is performed at each
year end.
The Group has performed an ECL assessment as each period end and based on management’s knowledge of the case and
parties involved at each period end, hindsight has not been applied in making this assessment. The receivable associated with
this damages based agreement has been fully provided for at each year end.
33. Contingent liabilities
The Company has been informed that HMRC has started an inquiry into the valuation of employee related securities issued by
the Company in April 2018 prior to the IPO. HMRC have queried the issue of shares between 4 April 2018 and 16 April 2018
at a par value. A valuation of the shares at above the issue price could result in a liability to the recipient of the issued shares
which would be required to be collected by the Company and paid to HMRC. Any liability would be re-imbursed in full by the
recipient. The directors’ belief is that the investigation is without merit.
The Group is involved in two claims from current or previous employees. The claim related to a previous employee has gone to
a tribunal and the Group is awaiting the outcome of that tribunal. The claim related to a current employee has not yet reached
a tribunal. Based on legal advice taken, management is confident that both claims are without merit and await a successful
outcome to both. As such, no contingent liability has been recognised during the period in relation to them.
34. Events after the reporting date
On 22 February 2024, the Group raised £0.9 million before expenses through the issue of new ordinary shares. A further
£2.1 million before expenses was raised through the issue of new ordinary shares on 12 March 2024. The fundraising was
strongly supported by existing institutional shareholders. Additionally, certain directors subscribed for £1.0 million of shares
as part of the fundraise. The purpose of the raise was to provide additional working capital to the Group.
On 28 March 2024, the Group completed the disposal of Convex Capital to a joint venture led by its management team.
Under the terms of the agreement, the Group received initial consideration of £2.0 million with up to another £600,000
payable on completion of certain subsequent transactions.
Following the completion of the disposal of Convex, Ian Rosenblatt stepped down from the Board. Ian remains the
Group’s largest shareholder and largest revenue earner.
102
32. Restatement of prior year (continued)
Earnings per share attributable to the ordinary equity holders of the parent
Basic (pence) from continuing operations
Diluted (pence) from continuing operations
Basic (pence) from total operations
Diluted (pence) from total operations
Restatement to 2022 statement of financial position:
Non-current assets
Trade and other receivables
30
Current liabilities
Provisions
Tax liabilities
Non-current liabilities
Deferred tax
Equity
Retained earnings
Breakdown of tax adjustments
Tax liabilities:
Transferred to assets held for sale (Note 13)
Restatement (i)
Deferred tax:
Transferred to assets held for sale (Note 13)
Restatement (i)
30 Damages based agreements originally presented as “litigation assets”.
Financial Statements
rbgholdings.co.uk
165 Fleet Street
London EC4A 2DY