REGISTERED NUMBER: SC630720 (Scotland)

Group Strategic Report, Report of the Directors and

Consolidated Financial Statements for the Year Ended 31 December 2023

for

Ambassador Group Holdings Limited

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

6

Report of the Independent Auditors

7

Consolidated Statement of Comprehensive Income

10

Consolidated Balance Sheet

12

Company Balance Sheet

13

Consolidated Statement of Changes in Equity

14

Company Statement of Changes in Equity

15

Consolidated Cash Flow Statement

16

Notes to the Consolidated Cash Flow Statement

17

Notes to the Consolidated Financial Statements

19

DIRECTORS:

D Gaffney

R Boyd

SECRETARY:

Brodies

REGISTERED OFFICE:

c/o Brodies LLP

110 Queen Street

Glasgow

G1 3BX

REGISTERED NUMBER:

SC630720 (Scotland)

AUDITORS:

McLay McAlister & McGibbon LLP

Chartered Accountants and Statutory Auditors

145 St Vincent Street

Glasgow

G2 5JF

The directors present their strategic report of the company and the group for the year ended 31 December 2023.

REVIEW OF BUSINESS

The Accounts have been prepared under FRS 102.

The Group’s key financial and performance indicators during the year are as follows:

2023

2022

£'000

£'000

Turnover

30,321

38,589

Operating (Loss) / Profit

(829)

2,001

Loss attributable to Group

(10,843)

(573)

Total Shareholders' Funds

(8,877)

1,966

Through the year the Group continued to conduct the majority of its business through two main divisions - Ambassador Residential Management (ARM), which specializes in residential land acquisition and development; and Ambassador Investment Management (AIM), focusing on real estate assets. To date the majority of the Group’s earnings have been derived from assets acquired through joint venture arrangements, put in place with selected and long-standing capital partners. This has, over recent years, been a key feature of the Group’s business model, whereby after sourcing the relevant opportunity, the Group then typically co-invests in the acquisition alongside the capital partner and is then engaged in the ongoing development or management of the acquired asset.

During the year, the strategy of the business evolved to assessing distressed and dislocated opportunities / workout situations for capital partners; and alongside this the creation of a new Operating Partner model, with in some cases, a degree of overlap. Remuneration through these new initiatives is primarily by asset management fees and share in net proceeds of the ultimate realization.

The challenges, presented by the economic and geopolitical backdrop, continued to impact on the operational efficiency of our Group. We have identified that the principle of a ‘risk-sharing’ model is often difficult to execute in challenging market conditions, and the Group balance sheet has been hit as a direct consequence of the current carrying values of assets at present.

In our residential contracting business, significant build cost movements alongside a slowdown in the residential market have led to a £2.6m loss and a cumulative >£6m negative contribution to the Group balance sheet.

In AIM, £8.2m of loss resulted from the revaluation of Broadway, as well as a c£4.5m negative contribution to the Group balance sheet. As noted below, however, these negative positions will unwind at the point of eventual disposal of the asset, as the related loan funding liability is released.

Ambassador Investment Management

We continued our asset management plan to transform Ocean Terminal Shopping Centre in Leith, Edinburgh. As reported last year, we obtained approval for the first phase of the masterplan, for part-demolition of the multi-storey car park and former Debenhams retail unit. Since year-end the second phase also received unanimous approval. This project is set to deliver a pedestrian-centred waterfront, more than 530 residential units, retail and commercial spaces in what is projected to amount to a £250m investment in Leith’s waterfront, retaining and creating more than 600 local jobs on an ongoing basis.

Our other assets have been further impacted by the post-pandemic yield shift, with particular negative sentiment around non grade-A office space. Against this background, our primary funding partner has been supportive of our focus on achieving a consent at Craigforth Campus, continued refurbishment of Ink Building in Glasgow; and the pursuit of a change-of-use consent at Granite House in Glasgow.

At Broadway Park a c£8.2m drop in valuation, at year-end, has resulted in the elimination of Ambassador’s economic interest in the asset, with amounts outstanding under the debt facility exceeding the asset value by £5.4m. Whilst this contributes significantly to the Group’s negative balance sheet at year-end, this will unwind at the point of eventual disposal of the asset, as the related loan funding liability is released.

We continue to look for opportunities to invest selectively in the real estate market. We continue to enjoy longstanding capital relationships which endure the idiosyncrasies of global market turbulence. We are confident that our longstanding track record of delivery on a thematic centered on creating value through proactive asset management, will create opportunities for investment in the future.

Ambassador Residential Management

At year-end, Ambassador was operational on four residential sites. We continued to carry out significant infrastructure and enabling works on Bangour Village Estate, which will see the construction over 970 energy efficient homes, the retention and refurbishment of eleven listed buildings, delivery of a district heating system, a community retail hub and significant investment in education provision for the area, including the construction of a new primary school on site. During the year we commenced works on the first phase of private for sale residential accommodation.

The business continued to be negatively impacted by factors arising from the sector and economy-wide issues, including depressed consumer confidence, underpinned by the cost-of-living crisis, inflationary backdrop and the uncertain geopolitical landscape globally. It has been difficult to pass through all increased costs, suffered by our contracting business, to the relevant land-owning vehicles, as several of these contributory factors have been in neither parties' control. Therefore, further losses have been somewhat inevitable, and we have incurred £2.6m of additional losses.

OUTLOOK

Despite the obvious short-term challenges of the business, we remain excited and positive about the outlook for our business. A group simplification strategy is underway through a disposal strategy of our commercial real estate owned assets, alongside a repositioning and downsizing of our residential offering into a more sustainable combined management structure, named Ambassador Investment Management (AIM).

We will transition towards a more fee based operating partner model. We have successfully adopted this service in the recent establishment of Regency Living in the Park Home sector. To fuel the expansion of this division, we have established Ambassador Portfolio Management (APM) team, to capitalise on the opportunities available.

We are confident that these actions, alongside the support of our capital partners, will enable us to trade out of our negative balance sheet position and return to profitability in the medium term.

PRINCIPAL RISKS AND UNCERTAINTIES

The following risks and associated mitigation processes represent the key risks and uncertainties which affect the group and how the directors address these. They are not intended to be an exhaustive analysis of all the risks facing the business.

1. Economic risks

Risks:

The group's business operations are sensitive to economic conditions and, in particular, to inflationary pressures on

pricing and implications to the levels of cost of materials. Property values are also impacted by the economic uncertainty.

Mitigation processes:

The directors regularly review the impact of the economic conditions on the group's budget and strategic plans, to ensure that we maintain our competitive position in the market. We try to foster mutually beneficial and long-term relationships with our suppliers whilst at the same time driving down costs in all areas. We have successfully negotiated various contracts, and will continue to do so, to mitigate significant increases in costs where possible and employ a number of other techniques to protect us from price volatility.

2. Regulatory risks

Risks:

A failure to comply with health and safety legislation could lead to an incident which causes serious illness, injury or

even loss of life to one of our customers, employees or other stakeholders, in turn leading to a significant impact on our reputation.

Mitigation processes:

We have a range of policies and procedures in place, including training, improved reporting and regular monitoring, to ensure compliance with existing regulatory requirements. This includes processes and procedures in relation to health and safety.

3. Supply chain risks

Risks:

The directors and senior management work with a number of key suppliers to facilitate the continued high quality

construction within our development sites. There is therefore a risk of interruption of supply and of failure of such key

suppliers or distributors.

Mitigation processes:

Our senior management is expected to work closely with our third-party suppliers, producers and supply chain partners to ensure that our relationships with them are positive and constructive at all times. Senior management regularly review the financial position of our major suppliers to assess the risk of them ceasing to be able to trade. It is our opinion that due to the non-specialist nature of the services used, our senior management would be able to source alternative supply arrangements should one of our suppliers cease to trade.

4. Financial risks

Risks:

It is vital to the business that we continue to meet our financial covenants and to ensure that there is sufficient financing to meet our business needs. We are exposed to interest rate risk on the variable rate components of our financing. We are also reliant on maintaining sound systems of internal control and on our information systems and technology to ensure the smooth operation of our business without risk of fraud or material error.

Mitigation processes:

Directors constantly monitor our performance against our financial covenants and undertakes detailed stress-testing of our performance against those covenants on a regular basis. Working capital is closely managed and carefully forecast, with regular dialogue with our private equity partners.

5. People risks

Risks:

We recognise the importance of attracting, retaining, developing and motivating the best people to help take our

business forward and to ensure that we can deliver our operational and strategic objectives. Failure to attract these

individuals could impact our ability to achieve our operational and strategic objectives.

Mitigation processes:

Directors aim to recruit the best people with the right skills and offer training and development programmes to ensure

that we retain them. Staff contracts and turnover trends are reviewed and benchmarked to highlight any potential issues.

ON BEHALF OF THE BOARD:

D Gaffney - Director

11 September 2025

The directors present their report with the financial statements of the company and the group for the year ended 31 December 2023.

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2023.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2023 to the date of this report.

D Gaffney

R Boyd

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Group Strategic Report, the Report of the Directors 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 the group and of the profit or loss of the group 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;

-	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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

ON BEHALF OF THE BOARD:

D Gaffney - Director

11 September 2025

Opinion

We have audited the financial statements of Ambassador Group Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of 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 group's and of the parent company affairs as at 31 December 2023 and of the group's loss 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 Auditors' 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, 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.

Material uncertainty relating to going concern

We draw attention to note 2 in the financial statements, which indicates the group is dependent on the support of its creditors and lenders. As stated, these conditions indicate that a material uncertainty exists that may cast significant doubt on the group's ability to continue as a going concern. Our opinion is not modified in this respect.

Other information

The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether 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 the audit:

-	the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Group Strategic Report and the Report of the Directors 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 its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Directors.

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 Statement of Directors' Responsibilities set out on page six, 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 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.

Auditors' 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 a Report of the Auditors 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:

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and

non-compliance with laws and regulations, we considered the following:

- the nature of the industry and sector, control environment and business performance;

- results of our enquiries of management about their own identification and assessment of the risks and irregularities;

- any matters we identified having reviewed the company's internal controls established to mitigate risks of fraud or

non- compliance with laws and regulations;

- the matters discussed among the audit engagement team regarding how and where fraud might occur in the

financial statements and any potential indicators of fraud.

We obtained an understanding of the legal and regulatory framework that the company operates in. The key laws and regulations we considered included the UK Companies Act and tax legislation. We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items. In addition we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate. These included health and safety, GDPR and employment laws. Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the directors, inspection of regulatory and legal correspondence, if any, and review of minutes of meetings.These limited procedures did not identify actual or suspected non-compliance.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

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 a Report of the Auditors 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.

Paul Martin (Senior Statutory Auditor)

for and on behalf of McLay McAlister & McGibbon LLP

Chartered Accountants and Statutory Auditors

145 St Vincent Street

Glasgow

G2 5JF

11 September 2025

TURNOVER

3

30,321,024

38,588,952

Cost of sales

(26,032,986

)

(32,301,603

)

GROSS PROFIT

4,288,038

6,287,349

Administrative expenses

including transaction costs

(5,196,319

)

(4,408,218

)

(908,281

)

1,879,131

Other operating income

79,150

122,198

OPERATING (LOSS)/PROFIT

6

(829,131

)

2,001,329

Profit/loss on disposal of

subsidiary

7

-

7,440,091

Loan interest written-off

7

(478,062

)

-

(1,307,193

)

9,441,420

Interest receivable and similar income

217

90,841

(1,306,976

)

9,532,261

(Loss)/Profit share on investment

8

233,008

(777,209

)

Gain/loss on revaluation of assets

(8,252,831

)

(2,616,528

)

(9,326,799

)

6,138,524

Interest payable and similar expenses

9

(2,472,439

)

(6,603,211

)

LOSS BEFORE TAXATION

(11,799,238

)

(464,687

)

Tax on loss

10

956,500

142,000

LOSS FOR THE FINANCIAL YEAR

(10,842,738

)

(322,687

)

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(10,842,738

)

(322,687

)

Loss attributable to:

Owners of the parent

(10,842,738

)

(573,124

)

Non-controlling interests

-

250,437

(10,842,738

)

(322,687

)

Total comprehensive income attributable to:

Owners of the parent

(10,842,738

)

(573,124

)

Non-controlling interests

-

250,437

(10,842,738

)

(322,687

)

FIXED ASSETS

Intangible assets

12

(83,189

)

(98,088

)

Tangible assets

13

178,309

95,579

Investments

14

64,797

74,997

Investment property

15

24,250,000

32,400,000

24,409,917

32,472,488

CURRENT ASSETS

Debtors

16

7,710,366

8,135,478

Investments

17

6,667

-

Cash at bank and in hand

2,080,870

3,316,854

9,797,903

11,452,332

CREDITORS

Amounts falling due within one year

18

(43,031,715

)

(14,090,679

)

NET CURRENT LIABILITIES

(33,233,812

)

(2,638,347

)

TOTAL ASSETS LESS CURRENT LIABILITIES

(8,823,895

)

29,834,141

CREDITORS

Amounts falling due after more than one year

19

(53,022

)

(27,384,820

)

PROVISIONS FOR LIABILITIES

23

-

(483,500

)

NET (LIABILITIES)/ASSETS

(8,876,917

)

1,965,821

CAPITAL AND RESERVES

Called up share capital

24

100

100

Retained earnings

25

(8,877,017

)

1,965,721

SHAREHOLDERS' FUNDS

(8,876,917

)

1,965,821

The financial statements were approved by the Board of Directors and authorised for issue on 11 September 2025 and were signed on its behalf by:

D Gaffney - Director

FIXED ASSETS

Intangible assets

12

-

-

Tangible assets

13

-

-

Investments

14

2

2

Investment property

15

-

-

2

2

CURRENT ASSETS

Debtors

16

98

98

TOTAL ASSETS LESS CURRENT LIABILITIES

100

100

CAPITAL AND RESERVES

Called up share capital

24

100

100

SHAREHOLDERS' FUNDS

100

100

Company's profit for the financial year

-

-

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the Board of Directors and authorised for issue on 11 September 2025 and were signed on its behalf by:

D Gaffney - Director

Called up

share

Retained

Non-controlling

Total

capital

earnings

Total

interests

equity

£

£

£

£

£

Balance at 1 January 2022

100

2,538,845

2,538,945

(250,437

)

2,288,508

Changes in equity

Total comprehensive income

-

(573,124

)

(573,124

)

250,437

(322,687

)

Balance at 31 December 2022

100

1,965,721

1,965,821

-

1,965,821

Changes in equity

Total comprehensive income

-

(10,842,738

)

(10,842,738

)

-

(10,842,738

)

Balance at 31 December 2023

100

(8,877,017

)

(8,876,917

)

-

(8,876,917

)

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2022

100

-

100

Changes in equity

Balance at 31 December 2022

100

-

100

Changes in equity

Balance at 31 December 2023

100

-

100

Cash flows from operating activities

Cash generated from operations

1

1,567,601

40,598,202

Interest paid

(2,467,846

)

(6,597,653

)

Interest element of hire purchase payments paid

(4,593

)

(5,558

)

Net cash from operating activities

(904,838

)

33,994,991

Cash flows from investing activities

Purchase of tangible fixed assets

(139,881

)

(10,008

)

Purchase of fixed asset investments

-

(50

)

Purchase of investment property

(92,830

)

(166,645

)

Sale of fixed asset investments

100

-

Sale of investment property

-

7,700,000

Purchase of current asset investments

(6,667

)

-

Interest received

217

90,841

Net cash from investing activities

(239,061

)

7,614,138

Cash flows from financing activities

New loans in year

-

410,804

Loan repayments in year

(83,720

)

(44,279,449

)

Capital repayments in year

(8,365

)

(20,420

)

Net cash from financing activities

(92,085

)

(43,889,065

)

Decrease in cash and cash equivalents

(1,235,984

)

(2,279,936

)

Cash and cash equivalents at beginning of year

2

3,316,854

5,596,790

Cash and cash equivalents at end of year

2

2,080,870

3,316,854

1.	RECONCILIATION OF LOSS BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

31.12.23

31.12.22

£

£

Loss before taxation

(11,799,238

)

(464,687

)

Depreciation charges

42,253

15,369

Loss on revaluation of fixed assets

8,242,830

2,616,528

Share of (profit)/loss on investment

-

777,209

Reclassification of investment property

-

6,530,117

Impairment of investments

10,100

-

Finance costs

2,472,439

6,603,211

Finance income

(217

)

(90,841

)

(1,031,833

)

15,986,906

Decrease in stocks

-

21,040,720

Decrease/(increase) in trade and other debtors

898,111

(1,944,466

)

Increase in trade and other creditors

1,701,323

5,515,042

Cash generated from operations

1,567,601

40,598,202

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2023

31.12.23

1.1.23

£

£

Cash and cash equivalents

2,080,870

3,316,854

Year ended 31 December 2022

31.12.22

1.1.22

£

£

Cash and cash equivalents

3,316,854

5,596,790

3.	ANALYSIS OF CHANGES IN NET DEBT

At 1.1.23

Cash flow

At 31.12.23

£

£

£

Net cash

Cash at bank and in hand

3,316,854

(1,235,984

)

2,080,870

3,316,854

(1,235,984

)

2,080,870

Liquid resources

Current asset investments

-

6,667

6,667

-

6,667

6,667

Debt

Finance leases

(69,752

)

8,365

(61,387

)

Debts falling due within 1 year

(83,720

)

(27,199,713

)

(27,283,433

)

Debts falling due after 1 year

(27,283,433

)

27,283,433

-

(27,436,905

)

92,085

(27,344,820

)

Total

(24,120,051

)

(1,137,232

)

(25,257,283

)