These financial statements have been prepared in accordance with Financial Reporting Standard 102 Section 1A - 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Companies Act 2006.

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

Investments and other creditors have been restated downwards by £241,349 to account for an amendment for an overstated investment included in the comparative period.

Key sources of estimation uncertainty

Impairment of stock and fixed assets
Determining whether stock and fixed assets require a provision for impairment involves estimation. The value of such assets is considered with reference to advice provided from professional third-party valuers. In the year ended 31 December 2024:

Broodmares were impaired by £1,641,490 (2023: £226,867) during the year resulting in a net book value of £7,573,673 (2023: £9,128,144). Stallion shares were impaired by £232,917 (2023: £11,078) during the year resulting in a net book value of £614,210 (2023: £844,945).

Depreciation of fixed assets
The Company reviews the residual values, estimated useful lives and depreciation rates of its tangible fixed assets at each reporting date to identify where any evidence of significant change exists since the last reporting date. The net book value of tangible fixed assets at 31 December 2024 was £11,010,854 (2023: £12,897,648).

Revenue recognition

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rate on the date when the fair value is re-measured.

Non-monetary items measured at historical cost in a foreign currency are not retranslated.

Tax

Tangible assets

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives.

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the profit or loss.

No depreciation is provided on freehold land or elements of freehold property improvements deemed to have indefinite lives.

Residual value is calculated on prices prevailing at the date of acquisition. Assets are reviewed for impairment, when events or changes in circumstances indicate the carrying value may not be recoverable. Assets are also reviewed for reversal of impairment when events or changes in circumstances indicate that its value prior to impairment can be recovered.

Depreciation is provided on the following basis:

Investments which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.

Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

The cost of nominations purchased, or depreciation on relevant stallion interests, together with broodmare depreciation is capitalised into stock as in-utero foals following a positive pregnancy diagnosis.

Interests in foals, yearlings and horses in training held for resale are stated at the lower of cost and net realisable value. Where a foal is born to one of the Company's own broodmares, the cost comprises the nomination fee payable to the stallion owner.

Where a broodmare is purchased in foal, a proportion of the cost is attributed to the foal based on the estimated nomination fee that would have been payable to the stallion owner, had the mare been covered at the expense of the Company. Where a broodmare is leased for the purpose of producing a foal, the value of the foal comprises the lease cost of the broodmare and the nomination fee payable to the stallion owner.

Broodmare depreciation is capitalised into the value of stock in line with FRS 102 Section 34.

The comparison of cost and net realisable value is separately undertaken for each individual bloodstock asset using an independent valuation at the year end.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers.

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the Profit and Loss Account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.

Assets held under finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the balance sheet as a finance lease obligation.

Lease payments are apportioned between finance costs in the profit and loss account and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.