LUCID GAMES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Company Registration No. 07497245 (England and Wales)
LUCID GAMES LIMITED
COMPANY INFORMATION
Directors
Miss H L Davidson
Mr P C Wallace
Secretary
Miss H L Davidson
Company number
07497245
Registered office
29-31 Parliament Street
Liverpool
England
L8 5RN
Auditor
DSG Audit
Castle Chambers
43 Castle Street
Liverpool
L2 9TL
LUCID GAMES LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Notes to the financial statements
11 - 21
LUCID GAMES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 1 -

The directors present the strategic report for the year ended 31 December 2024.

Principal activity and fair review of the business

The principal activity of the company continued to be that of the provision of management services to the wider group.

In the period turnover has increased from £13.2m to £20.2m at 31 December 2024. The company is generating an operating profit of £1.3m compared to an operating loss in the prior period of £1.1m. The balance sheet has remained strong at £5.1m (2023: £3.5m).

Principal risks and uncertainties

The principal risks and uncertainty's facing the company are as follows:

Liquidity risk

The company manages its cash in order to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient resources to meet the operating needs of the business.

Credit risk

The company monitors credit risk closely and considers that its current credit checking policy meets its objectives in mitigating risk in this area. Trade debtors are reviewed on a regular basis and provision made for doubtful debts when necessary.

Non financial risk

The quality and technical ability of staff is fundamental to the operations of the business. Therefore, being able to retain and also recruit new staff remains a key focus for the business.

Key performance indicators

The company strategy is one of growth and continued profitability. Performance for the current period, together with comparative data for the previous year, is set out below:

(a) Turnover

The company performed as expected due to service requirements within the wider group. As such turnover increased from £13.2m to £20.2m.

(b) Operating profit/(loss)

The company generated an operating profit of £1.3m compared to a loss of £1.1m, due to the level of services provided around the group.

Future developments

The goal is to continue the steady growth of the studio by exploring new co development relationships with Lightspeed internal games studios, whilst maintaining our existing successful co development relationships. Alongside this we will continue to focus on further developing our own internally generated IP's to their next phase of development and push new boundaries in creativity.

On behalf of the board

Miss H L Davidson
Director
8 August 2025
LUCID GAMES LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -

The directors present their annual report and financial statements for the year ended 31 December 2024.

The report contains the statutory information disclosed in addition to that set out in the strategic report. Information relating to principal activity and risk management, which would otherwise be included in the Directors Report, is included in the Strategic Report.

Results and dividends

The results for the year are set out on page 7.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Miss H L Davidson
Mr P C Wallace
Auditor

The auditor, DSG Audit, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Miss H L Davidson
Director
8 August 2025
LUCID GAMES LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 3 -

The directors are responsible for preparing the annual 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 financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 company and of the profit or loss of the company for that period.

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; and

- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

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 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.

LUCID GAMES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF LUCID GAMES LIMITED
- 4 -
Opinion

We have audited the financial statements of Lucid Games Limited (the 'company') for the year ended 31 December 2024 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

- give a true and fair view of the state of the company's affairs as at 31 December 2024 and of its profit for the year then ended;

- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

- 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 company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The 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 this gives rise to 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 our audit:

- the information given in the strategic report and the directors' r eport 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.

LUCID GAMES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LUCID GAMES LIMITED
- 5 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identifie d material misstatements in the strategic report or the directors' r eport.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

- adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

- the 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' r esponsibilities s tatement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Capability of the audit in detecting irregularities, including fraud

Discussions were held with, and enquiries made of, management and those charged with governance with a view to identifying those laws and regulations that could be expected to have a material impact on the financial statements. During the engagement team briefing, the outcomes of these discussions and enquiries were shared with the team, as well as consideration as to where and how fraud may occur in the entity.

The following laws and regulations were identified as being of significance to the entity:

- Those laws and regulations considered to have a direct effect on the financial statements include UK financial reporting standards, Company Law, Tax and Pensions legislation.

- It is considered that there are no laws and regulations for which non-compliance may be fundamental to the operating aspects of the business.

Audit procedures undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised of: enquiries of management and those charged with governance as to whether the entity complies with such laws and regulations; enquiries with the same concerning any actual or potential litigation or claims; inspection of relevant legal correspondence; testing the appropriateness of entries in the nominal ledger, including journal entries; reviewing transactions around the end of the reporting period; and the performance of analytical procedures to identify unexpected movements in account balances which may be indicative of fraud.

LUCID GAMES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LUCID GAMES LIMITED
- 6 -

No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity’s controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Laura Leslie BSc FCA
Senior Statutory Auditor
For and on behalf of DSG Audit
8 August 2025
Chartered Accountants
Statutory Auditor
Castle Chambers
43 Castle Street
Liverpool
L2 9TL
LUCID GAMES LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 7 -
Year
Period
ended
ended
31 December
31 December
2024
2023
Notes
£
£
Turnover
3
20,166,132
13,236,841
Cost of sales
(1,219,401)
(869,785)
Gross profit
18,946,731
12,367,056
Administrative expenses
(17,753,660)
(13,450,878)
Other operating income
69,463
-
0
Operating profit/(loss)
5
1,262,534
(1,083,822)
Interest payable and similar expenses
8
(20,253)
(75,832)
Other gains
9
66,673
-
0
Profit/(loss) before taxation
1,308,954
(1,159,654)
Tax on profit/(loss)
10
236,015
(50,204)
Profit/(loss) for the financial year
1,544,969
(1,209,858)

The profit and loss account has been prepared on the basis that all operations are continuing operations.

LUCID GAMES LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
- 8 -
Year
Period
ended
ended
31 December
31 December
2024
2023
£
£
Profit/(loss) for the year
1,544,969
(1,209,858)
Other comprehensive income
-
-
Total comprehensive income for the year
1,544,969
(1,209,858)
LUCID GAMES LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2024
31 December 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
12
597,227
639,706
Investments
13
1,206,000
1,206,000
1,803,227
1,845,706
Current assets
Debtors
15
5,958,465
5,586,049
Cash at bank and in hand
50,172
36,308
6,008,637
5,622,357
Creditors: amounts falling due within one year
16
(2,751,094)
(3,952,262)
Net current assets
3,257,543
1,670,095
Net assets
5,060,770
3,515,801
Capital and reserves
Called up share capital
18
1
1
Profit and loss reserves
5,060,769
3,515,800
Total equity
5,060,770
3,515,801

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 8 August 2025 and are signed on its behalf by:
Miss H L Davidson
Director
Company registration number 07497245 (England and Wales)
LUCID GAMES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 10 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 April 2023
1
4,725,658
4,725,659
Period ended 31 December 2023:
Loss and total comprehensive income
-
(1,209,858)
(1,209,858)
Balance at 31 December 2023
1
3,515,800
3,515,801
Year ended 31 December 2024:
Profit and total comprehensive income
-
1,544,969
1,544,969
Balance at 31 December 2024
1
5,060,769
5,060,770
LUCID GAMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 11 -
1
Accounting policies
Company information

Lucid Games Limited is a private company limited by shares incorporated in England and Wales. The registered office is 29-31 Parliament Street, Liverpool, England, L8 5RN.

The principal activity of the company is set out in the strategic report.

1.1
Reporting period

The prior period financial statements were prepared for a period shorter than one year to 31 December 2023 due to a change in ownership. Comparative amounts presented in the financial statements (including the related notes) are therefore not entirely comparable.

1.2
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary a mounts in these financial statements are rounded to the nearest £1.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below and have been consistently applied.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. T he company has therefore taken advantage of e xemptions from the following disclosure requirements:

- Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

- Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

- Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

The company has taken advantage of the exemption under section 400 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.

Lucid Games Limited is a wholly owned subsidiary of Lucid Entertainment Group Limited and the results of Lucid Games Limited are included in the consolidated financial statements of Lucid Entertainment Group Limited which are available from the same registered address as the Company.

1.3
Going concern

The Company prepares forecasts which are regularly reviewed by the Directors. The company can operate through its cash reserves and by management of its working capital. The directors regularly review the forecasts and working capital requirements to ensure there is sufficient resources to meet current and future operational needs. At the time of approving the financial statements, the directors understand this to be the case. As such, the directors continue to adopt the going concern basis of accounting in preparing the financial statements.true

LUCID GAMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 12 -
1.4
Turnover

Turnover represents amounts receivable for goods and services net of VAT and trade discounts.

Turnover is recognised as and when services are delivered on a monthly basis.

1.5
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

1.6
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Development costs
10% Straight Line
1.7
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold improvements
Over the life of the lease
Plant and equipment
20% Straight Line
Fixtures and fittings
20% Straight Line
Computers
33% Straight Line
Motor vehicles
20% Straight Line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.8
Fixed asset investments

Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

LUCID GAMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 13 -
1.9
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.10
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.11
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

LUCID GAMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 14 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans and loans from fellow group companies are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future paymen ts discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. A m ounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value th r ough profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.12
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

LUCID GAMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 15 -
1.13
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company 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.

1.14
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.15
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.16
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease s asset are consumed.

1.17
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

1.18

Exceptional item

Exceptional items are disclosed separately in the financial statements where it is necessary to do so to provide further understanding of the financial performance of the company. They are material items of income or expenditure which are of exceptional size of incidence.

LUCID GAMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 16 -
2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Depreciation of tangible fixed assets

Tangible fixed assets are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.

3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Sale of services
20,166,132
13,236,841
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
20,166,132
13,236,841
2024
2023
£
£
Other revenue
Research and Development Expenditure Credit
69,463
-
4
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
10,745
9,900
LUCID GAMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 17 -
5
Operating profit/(loss)
2024
2023
Operating profit/(loss) for the year is stated after charging:
£
£
Exchange losses
9,843
1,563
Fees payable to the company's auditor for the audit of the company's financial statements
10,745
9,900
Depreciation of owned tangible fixed assets
426,291
377,527
Operating lease charges
23,604
-
6
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2024
2023
Number
Number
Administrative
52
44
Production
176
131
Total
228
175

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
13,049,938
9,626,425
Social security costs
1,363,435
1,413,276
Pension costs
740,430
394,761
15,153,803
11,434,462
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
363,970
217,981
Company pension contributions to defined contribution schemes
37,267
23,927
401,237
241,908
LUCID GAMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
7
Directors' remuneration
(Continued)
- 18 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
194,354
89,399
Company pension contributions to defined contribution schemes
18,248
9,154
8
Interest payable and similar expenses
2024
2023
£
£
Other interest
20,253
75,832
9
Other gains
2024
2023
£
£
Gain on loan forgiven
66,673
-
66,673
-
10
Taxation
2024
2023
£
£
Current tax
Adjustments in respect of prior periods
(236,015)
50,204

The actual (credit)/charge for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
Profit/(loss) before taxation
1,308,954
(1,159,654)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 25.00% (2023: 25.00%)
327,239
(289,914)
Tax effect of expenses that are not deductible in determining taxable profit
10,000
11,605
Movement in unrecognised deferred tax
(337,239)
278,309
Video games tax relief credit prior years
(236,015)
(298,405)
Reversal of research and development tax credit in relation to prior years
-
0
348,609
Taxation (credit)/charge for the year
(236,015)
50,204
LUCID GAMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
10
Taxation
(Continued)
- 19 -

The Company only recognises deferred income tax assets for unused cumulative tax losses if it is probable that future taxable profits will be available to utilise those tax losses. As at 31 December 2024, the Company did not recognise deferred income tax assets in relation to cumulative tax losses of £1,161,350 (December 2023: £2,547,990).

11
Intangible fixed assets
Development costs
£
Cost
At 1 January 2024 and 31 December 2024
462,895
Amortisation and impairment
At 1 January 2024 and 31 December 2024
462,895
Carrying amount
At 31 December 2024
-
0
At 31 December 2023
-
0
12
Tangible fixed assets
Leasehold improvements
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 January 2024
99,350
93,915
524,560
1,290,347
21,870
2,030,042
Additions
-
0
-
0
28,363
355,449
-
0
383,812
At 31 December 2024
99,350
93,915
552,923
1,645,796
21,870
2,413,854
Depreciation and impairment
At 1 January 2024
-
0
61,042
302,689
1,022,414
4,191
1,390,336
Depreciation charged in the year
25,366
18,783
109,264
268,504
4,374
426,291
At 31 December 2024
25,366
79,825
411,953
1,290,918
8,565
1,816,627
Carrying amount
At 31 December 2024
73,984
14,090
140,970
354,878
13,305
597,227
At 31 December 2023
99,350
32,873
221,871
267,933
17,679
639,706
13
Fixed asset investments
2024
2023
Notes
£
£
Investments in subsidiaries
14
1,206,000
1,206,000
LUCID GAMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 20 -
14
Subsidiaries

Details of the company's subsidiaries at 31 December 2024 are as follows:

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Lucid Publishing Ltd
29-31 Parliament Street, Liverpool, England, L8 5RN
Ready-made interactive leisure and entertainment software development
Ordinary
100.00
15
Debtors
2024
2023
Amounts falling due within one year:
£
£
Corporation tax recoverable
534,420
298,405
Amounts owed by group undertakings
5,082,404
1,509,807
Other debtors
76,790
7,327
Prepayments and accrued income
264,851
3,770,510
5,958,465
5,586,049

Amounts owed by group undertakings are unsecured, interest free and are repayable on demand.

16
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
83,507
136,437
Amounts owed to group undertakings
1,285,130
1,360,628
Taxation and social security
1,105,547
2,270,909
Other creditors
216,651
171,997
Accruals and deferred income
60,259
12,291
2,751,094
3,952,262

Amounts owed to group undertakings are unsecured, interest free and are repayable on demand.

17
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
740,430
394,761

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

LUCID GAMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 21 -
18
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
1
1
1
1
19
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2024
2023
£
£
Within one year
304,746
198,711
Between two and five years
508,163
517,594
812,909
716,305
20
Related party transactions

The company is exempt from disclosing transactions with group companies that are wholly owned within the same group.

21
Ultimate controlling party

The company is a wholly owned subsidiary of Lucid Entertainment Group Ltd.

Lucid Entertainment Group Ltd is a company incorporated in England and Wales under company number 12750278.

The ultimate parent company is Tencent Holdings Limited, which prepares consolidated financial statements.

Tencent Holdings Limited is a company incorporated in Cayman Islands.

The following are t he parents of the largest and smallest groups in which this company's results are consolidated:

Largest group
Tencent Holdings Limited
Smallest group
Lucid Entertainment Group Limited

There is no ultimate controlling party.

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