The directors present the strategic report for the year ended 31 March 2025.

Northumbria Healthcare Facilities Management Limited (“NHFM”) is a company incorporated and domiciled in the UK. The Company is a wholly owned subsidiary of Northumbria Healthcare NHS Foundation Trust (“the Trust”).

The principal activities of the Company are to design, finance, construct and operate healthcare facilities and provide facility management services. NHFM works with a client throughout the capital development process from concept through to final occupation. It ensures that facilities, projects and contracts are managed efficiently, correctly, on time and on budget. NHFM has strong links to, and knowledge of, NHS organisations, as well as working in partnership with other public bodies and private partners.

The Company provides fully managed healthcare facilities to each of the Trust sites.

The Company’s model for project execution is built on solid delivery principles. Highly experienced specialists are embedded in the team to ensure all facets of development are fit for purpose and effective. Core NHS values, compliance with statutory regulations, and design principles are used to manage key risks from project inception through to the operational management of live sites.

Business review

The results of the Company are set out in detail on the following pages. Turnover for the year grew 9% year on year to £239.3m (31 March 2024: £219.9m) driven by increased activity in both delivery of capital projects and provision of estates and facilities services.

Throughout the year, the Company has successfully delivered a substantial capital programme, including 20 project completions with investment of over £90m into the estate enhancing our infrastructure, facilities and services. This has enabled an improved quality of care within our region.

In June 2024, the Northumbria Health and Care Academy officially opened on the grounds of the Northumbria Specialist Emergency Care Hospital in Cramlington. This state-of-the-art, £32 million facility delivered by NHFM is a cornerstone of the Trust’s commitment to advancing staff training and career development. In February 2025, the Academy became the first healthcare building in the UK to achieve Gold WELL Certification from the International WELL Building Institute. This prestigious recognition highlights excellence in both design and operation, emphasising 10 key principles that promote health and wellbeing.

Continuing improvements at Hexham General Hospital is ongoing, this includes refurbishment of Dental, Oncology, Women’s Health and Endoscopy facilities. The multi-million-pound investment programme at Hexham will continue into 2025/26. Construction of the new Berwick Hospital made significant strides in the year, with the state-of-the-art facility on track to be completed in late 2025.

In 2024, we made significant strides in strengthening and developing our community and primary care estates. Investment in expert leadership, resource and capability have led to development of estate strategies to support and enhance clinical delivery, maximizing the use of both inherited and new facilities in a creative and financially sustainable way. We recognise the vital role that healthcare environments play in both patient and staff experience, and we remain committed to investing in our community estates to enhance standards and improve facilities.

The environment continues to be an area of focus, the dedicated and expert Sustainability team is leading on the rollout of the Trust’s Net Zero Northumbria action plan, and to ensure compliance in all aspects of environmental and waste management. The team provides specialist technical support and advice on a range of sustainability projects to lower carbon in line with the NHS Green Plan. Completed energy efficiency projects included Alnwick Infirmary & Cobalt Solar Photovoltaics, Rothbury Community Hospital LED lights, Wansbeck General Hospital and North Tyneside General Hospital air conditioning controls.

Estates and facilities service delivery has performed well across the year as the Directors monitor closely service metrics across all hard and soft facilities management functions. This annual NHS assessment evaluates the quality of non-clinical aspects of healthcare facilities, including cleanliness, privacy, food, and general building maintenance. In the latest results, published in March 2025, NHFM’s services underpinned the Trust ranking above the national average in all eight assessed areas. Notably, the highest national score was achieved in the combined food category for large acute trusts, ranked top nationally for cleanliness, assessing the condition of patient equipment, furniture, and facilities.

The Company’s financial growth allows for further investment in our commercial functions, offering new jobs in the region and developing our service proposition. Our Personal Protective Equipment manufacturing centre continues to function in line with expectation. A full commercial review and repositioning of the proposition has taken place in the financial year and refreshed operational and commercial opportunities are in train. In parallel, NHFM’s warehousing capacity and capability has been enhanced. Investment in warehouse infrastructure has led to a new commercial opportunity that will come on stream in 2025.

Improvements to our digital capability have taken place across the year in all areas of the business. The ‘Transforming Digitally’ project is changing how we operate and is facilitating increased value to our customers through efficient and effective services to ultimately improve patient care. Expansion of our data and information team has enabled us to leverage better value and insight from data to ensure service level compliance and identify and rectify any issues that may arise.

The highlights of 2024/25 for NHFM include:

• Delivering 20 strategic capital schemes including ward and theatre refurbishments.

• Progressing the delivery of the Net Zero plan for the Trust in line with national NHS guidance, achieving Silver Accreditation with the national investors in the environmental scheme.

• Creating North East jobs with a workforce now 1,080 colleagues.

• Adopting management of 120 community properties and establishing three new community partnerships.

• The highest national score in the Patient Led Assessment of the Care Environment for food quality; and for cleanliness.

• External recognition from several industry groups, awards were received for core services including cleaning, portering, security and sustainability amongst others.

The Company’s risk management framework is reviewed by the NHFM Board and operations are governed and applied in line with group policy. The Company remains committed to ensuring high level service delivery that meets all required standards.

Key performance indicators

Key performance indicators are presented and monitored through the NHFM Board. Profit before tax reported for the year was £0.4m (31 March 2024: 0.3m) from turnover of £239.3m (31 March 2024: £219.9m). Maintaining a strong liquidity position resulted in a cash balance of £0.8m at the balance sheet date (31 March 2024: £1.6m).

KPIs focus on the delivery of the services we provide to the Trust in monitoring the delivery of our facilities, projects and contractual commitments to ensure that these are managed efficiently, correctly, on time and on budget. A range of finance, colleague and performance metrics are used by service areas in the day to day running of the business.

The NHFM Directors carry out their duties in a manner which promotes the success of the Company for the benefit of the shareholder. Acting fairly, due regard is paid to a broad range of matters whilst considering the consequences of decisions over the long term on wider stakeholders. The Directors believe they receive information and have open access to key personnel that enables them to identify and understand any issues and promote good practice and a positive working culture.

To the extent necessary for an understanding of the development, performance and position of NHFM, examples of how the Board has this financial year considered the matters set out in Section 172 are detailed below.

Section 172 continued

Going concern

The Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future noting that the Company recorded a profit in the period and that it is forecast to do so in the forthcoming financial year.

The Directors accept that there is a significant reliance on related party contracts and have assessed the agreements in place. Suitable assurances were sought and received that the ultimate parent and controlling party, Northumbria Healthcare NHS Foundation Trust, is committed to and capable of meeting its obligations to the Company. The Directors have concluded that it is appropriate to continue to adopt the going concern basis of preparing the annual financial statements.

Future developments

The Company will continue to assess opportunities to enter new and emerging markets, particularly within the wider NHS sector. The five-year strategic planning cycle will lead to a refreshed plan in 2026 but one that retains continuing focus on robust service delivery to Northumbria Healthcare NHS Trust. NHFM will persist in ensuring a strong reputation and proven track record for delivery is maintained.

Supporting the Trust in delivery of its investment plan includes near-term delivery of the Berwick Community Hospital, and further upgrades to facilities at Hexham General Hospital and the infrastructure at the Northumbria Specialist Emergency Care Hospital. A longer-term programme of prioritising and delivering improvements to other base sites in the estate is coupled with projects to enhance the community buildings the Trust operates from.

On behalf of the board

The directors present their annual report and financial statements for the year ended 31 March 2025.

The results for the year are set out on page 11.

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

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

The Company has not undertaken any material research and development activity in the period.

The Company is committed to the fair treatment of people with disabilities in relation to applications, training, and career development. If an existing employee becomes disabled, the Company makes every effort to enable them to continue their employment and career development, and to arrange appropriate support, wherever practical.

The Directors recognise that employee engagement underpins the Company’s performance in delivering its services and are committed to that engagement through a number of ongoing strategies and activities. This includes periodic experience surveys, regular board walkabouts, monthly newsletters and ‘Team Talks’ at all the Company’s sites. Measurement and action planning are key to all engagement activity, and a suite of metrics, updates and plans are discussed at every board meeting. The Directors were particularly pleased to note in the period that the annual staff engagement survey achieved its highest ever participation rate, 70%.

The auditor, Robson Laidler Accountants Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Northumberland Healthcare Facilities Management leads the Northumbria Healthcare NHS Foundation Trust group Net Zero strategy via a team of subject matter experts in sustainability. An inclusive approach across the Trust is delivering the group’s ambition for Net Zero on or before 2040 by ‘adapting, innovating, and changing the ways we work to protect our planet, and our people’. Specifically, targets are

• for directly controlled emissions, Net Zero by 2040, with an ambition to reach an 80% reduction by 2028 to 2032; and

• for emissions we can influence, Net Zero by 2045, with an ambition to reach an 80% reduction by 2036 to 2039.

Northumbria Healthcare initially launched a Green Plan strategy in 2022 in response to the Health and Care Act 2022 and the Delivering a Net Zero NHS guidance solidifying responsibilities for targets to reduce carbon emissions. The Green Plan also incorporates other NHS England guidance documents including the Net Zero Supplier Roadmap, the NHS Net Zero Travel and Transport Strategy, and the Estates Net Zero Carbon Delivery Plan.

The second iteration of the Green Plan covers 2025 – 2028 outlining both advancement to date and actions for the next three years actions with forecast progress towards achieving the targets.

Further sustainability information including the Green Plan for 2025 – 2028, Sustainability Annual Report, Net Zero Action Plan and Carbon Reduction Plan, including the CO2 footprint for the Northumbria Healthcare NHS Foundation Trust group is available online at Sustainability :: Northumbria Healthcare NHS Foundation Trust

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;

• state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; 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.

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.

We have audited the financial statements of Northumbria Healthcare Facilities Management Limited (the 'company') for the year ended 31 March 2025 which comprise 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 March 2025 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' 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.

In the light of the knowledge and understanding of the company and its 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 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.

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

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.

The risk of material misstatement due to error or fraud has been assessed in conjunction with how internal controls may mitigate any such risk. These controls are reviewed as part of the audit by performing systems walkthroughs to ensure they are operating effectively. Analytical review and substantive testing is also performed on all material balances and therefore any instances of non-compliance should be identified or considered as insignificant. In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team;

• obtained an understanding of the nature of the industry and sector, including the legal and regulatory framework, in which the company operates and how the company complies with that legal and regulatory framework

• inquired with management and those charged with governance about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud

• discussed with management and those charged with governance any non-compliance with laws and regulations and how fraud might occur including assessments of how and where the financial statements may be susceptible to fraud.

The risk of management override of controls was also considered an area of potential misstatement due to fraud. Audit procedures performed included testing of manual journal entries and other adjustments and evaluating the business rationale in relation to significant, unusual transactions and transactions entered into outside the normal course of business.

There are inherent limitations in the audit procedures described above and the primary responsibility for the prevention and detection of irregularities including fraud rests with management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls.

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.

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

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.

Northumbria Healthcare Facilities Management Limited is a private company limited by shares incorporated in England and Wales. The registered office is Northumbria House, Unit 7 & 8 Silver Fox Way, Cobalt Business Park, North Shields, NE27 0QJ.

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 amounts in these financial statements are rounded to the nearest £000.

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

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. The company has therefore taken advantage of exemptions 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 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;

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

The Company's ultimate parent undertaking, Northumbria Healthcare NHS Foundation Trust includes the Company in its consolidated financial statements. The consolidated financial statements of Northumbria Healthcare NHS Foundation Trust are available to the public and may be obtained from the Finance Department, Northumbria House, Unit 7/8 Silver Fox Way, Cobalt Business Park, Tyne and Wear, NE27 0QJ.

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Turnover on the design and construction of several design and build projects is recognised at the value of work done. Turnover on operating services represents the value of work performed in the period under contract, together with additional services provided to the Trust.

Stocks are stated at the lower of cost and net realisable value. Cost is based on first in first out principle and includes expenditure incurred in acquiring the stocks, production and other costs in bringing them to their existing location and condition.

All construction costs incurred in the project are recorded as construction work in progress during the construction phase of the project. Costs are recognised as costs of sales to the extent that they relate to the value of work done in respect of turnover recognised. On the commencement of the services element of the contract, amounts outstanding are transferred from amounts recoverable on contracts into finance debtor. Amounts receivable under the agreement with Northumbria Healthcare NHS Foundation Trust relating to the hospital facilities transferred are included under finance debtors and represent the total amount outstanding under the agreement less unearned interest. Finance lease income is allocated to accounting periods so as to give a constant rate of return on the net cash investment in the lease.

Trade and other debtors/creditors

Trade and other debtors are recognised initially at transaction price less attributable transaction costs. Trade and other creditors are recognised initially at transaction price plus attributable transaction costs. Subsequent to initial recognition they are measured at amortised cost using the effective interest rate method, less any impairment losses in the case of trade debtors. If the arrangement constitutes a financing transaction, for example if payment is deferred beyond normal business terms, then it is measured at the present value of future payments discounted at a market rate of instrument for a similar debt instrument.

Interest- bearing borrowings classified as basic financial instruments

Interest-bearing borrowings are recognised initially at the present value of future payments discounted at a market rate of interest. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost using the effective interest method, less any impairment losses.

Dividends on shares presented within shareholders funds

Dividends are only recognised as a liability at that date to the extent that they are declared prior to the year end. Unpaid dividends that do not meet these criteria are disclosed in the notes to the financial statements.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, 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.

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.

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.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

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 through 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.

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

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

NHS Pension Scheme

Past and present employees are covered by the provisions of the two NHS Pension Schemes. Both schemes are unfunded, defined benefit schemes that cover NHS employer, general practices and other bodies, allowed under the direction of Secretary of State for Health and Social Care in England and Wales. The scheme is not designed in a way that would enable employers to identify their share of the underlying scheme assets and liabilities. Therefore, the scheme is accounted for as though it is a defined contributions scheme: the cost to the company is taken as equal to the employer's pension contributions payable to the scheme for the accounting period. The contributions are charged to the operating expenses as they become due.

Additional pension liabilities arising from early retirements are not funded by the scheme except where the retirement is due to ill-health. The full amount of the liability for the additional costs is charged to the operating expenses at the time the company commits itself to the retirement, regardless of the method of payment.

National Employment Savings Trust

The company operates an alternative mandatory scheme, National Employment Savings Trust (NEST), for employees who do not qualify to become a member of the NHS Pension Scheme. The scheme is a defined contribution scheme: the cost to the company is taken as equal to the employer's pension contributions payable to the scheme for the accounting period. The contributions are charged to the operating expenses as they become due.

Transactions that are denominated in foreign currency are translated into sterling at the exchange rate ruling on the dates of the transactions. Resulting exchange gains or losses are taken to the profit or loss account.

Impairment excluding stocks and deferred tax assets

Financial assets (including trade and other debtors)

A financial asset not carried at fair value through profit or loss is assessed at each reporting date to determine whether there is objective evidence that it is impaired. A financial asset is impaired if objective evidence indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event had a negative effect on the estimated future cash flows of that asset that can be estimated reliably.

An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the assets original effective interest rate. For financial instruments measured at cost less impairment and impairment is calculated as the difference between its carrying amount and the best estimate of the amount that the Company would receive for the asset if it were to be sold at the reporting date. Interest on the impaired asset continues to be recognised through the unwinding of the discount. Impairment losses are recognised in profit or loss. When a subsequent events causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss.

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

Their aggregate remuneration comprised:

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2024 - 2).

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

The corporation tax charge relates to consideration paid to a fellow group company for group relief. The amount paid for losses claimed was £113,960 (2024: £84,227).

Amounts recoverable on contracts comprise amounts due from the parent undertaking for projects in the planning and build phase as detailed in the Strategic Report.

The company has a 25 year loan facility from its parent undertaking. Loan amounts are drawn down as new planning and build projects are agreed. Capital repayments under these loan agreements commenced in 2016 with a new agreement agreed in January 2024 which superseded the original facility agreement. These loans carry interest at 4% and 3.5%. The facility is secured by fixed and floating charges over both present and future assets of the company.

Other amounts due to group undertakings are unsecured and repayable on demand.

The Company entered into a 30 year lease for hospital accommodation with an external party. The leased accommodation is provided to the parent undertaking as part of the provision of fully managed healthcare facilities.

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

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.

Amounts contracted for but not provided in the financial statements:

The company is controlled by Northumbria Healthcare NHS Foundation Trust, as a wholly owned subsidiary. The only group accounts in which these accounts are consolidated is that headed by Northumbria Healthcare NHS Foundation Trust. The consolidated financial statements of Northumbria Healthcare NHS Foundation Trust are available from Northumbria House, Unit 7/8, Silver Fox Way, Cobalt Business Park, Newcastle upon Tyne, NE27 0QJ.