Registered number: 10585680
COMPANY INFORMATION
CONTENTS
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2025
The directors present their Strategic Report and the consolidated financial statements for the year ended 31 March 2025 for Cortx Holdings Limited (the 'Company') and its subsidiaries (the 'Group').
The principal activity of the Group is that of the provision of advisory and investment management services to real estate entities.
Effective from 1 April 2024, Delancey Real Estate Asset Management Limited (DREAM), a wholly owned subsidiary, transferred certain client service agreements to its 100% subsidiary, Delancey Investment Advisory Services Limited (DIAS). DREAM continues to provide advisory and investment management services in respect of the real estate portfolio of a UK pension scheme. Following the restructure, all of the expenses except premises costs such as rent, rates and service charge have also been transferred to DIAS. These occupational expenses are then recharged to group companies. All staff were also transferred to other group companies.
During the year, DREAM was presented with the prospect of a settlement agreement in respect of historical litigation between the Company and HM Revenue & Customs, which the directors with the advice from their legal counsel agreed terms. Under this agreement the terms of the settlement are confidential and therefore the amount of the settlement has not been disclosed as this would be prejudicial to both DREAM and the wider Group and the terms under this agreement.
The results for the year and the financial position of the Group at the year end were considered satisfactory by the directors who expect revenue generated to be consistent and sufficient to fund the Group's expenses going forwards.
Effective from 1 April 2024, Delancey Real Estate Asset Management Limited (DREAM), a wholly owned subsidiary, transferred certain client service agreements to its 100% subsidiary, Delancey Investment Advisory Services Limited (DIAS). DREAM continues to provide advisory and investment management services in respect of the real estate portfolio of a UK pension scheme. Following the restructure, all of the expenses except premises costs such as rent, rates and service charge have also been transferred to DIAS. These occupational expenses are then recharged to group companies. All staff were also transferred to other group companies.
During the year, DREAM was presented with the prospect of a settlement agreement in respect of historical litigation between the Company and HM Revenue & Customs, which the directors with the advice from their legal counsel agreed terms. Under this agreement the terms of the settlement are confidential and therefore the amount of the settlement has not been disclosed as this would be prejudicial to both DREAM and the wider Group and the terms under this agreement.
The results for the year and the financial position of the Group at the year end were considered satisfactory by the directors who expect revenue generated to be consistent and sufficient to fund the Group's expenses going forwards.
The Group's operations are affected by fluctuations in the UK property market and the UK financial climate in general and the directors are actively monitoring the evolving market conditions. The directors believe that the quality and breadth of its clients' portfolios largely protects the Group from such movements. Substantially all of the Group's turnover is derived from contractual agreements. The directors believe that given their knowledge of the activities and financial position of the Group's customers, there is no significant risk of non-collection of revenue due under these contracts.
DREAM, a wholly owned subsidiary, was at the balance sheet date registered as an Exempt Reporting Advisor with the Securities and Exchange Commission (SEC) under the Investment Advisers Act of 1940. And is also a fully authorised and regulated firm by the Financial Conduct Authority (FCA).
In relation to financial instruments, the Group has established financial risk management procedures whose primary objectives are to protect the Group from events that hinder the Group's performance. The objectives aim to limit undue counterparty exposure, ensure sufficient working capital exists and monitor the management of risk.
DREAM, a wholly owned subsidiary, was at the balance sheet date registered as an Exempt Reporting Advisor with the Securities and Exchange Commission (SEC) under the Investment Advisers Act of 1940. And is also a fully authorised and regulated firm by the Financial Conduct Authority (FCA).
In relation to financial instruments, the Group has established financial risk management procedures whose primary objectives are to protect the Group from events that hinder the Group's performance. The objectives aim to limit undue counterparty exposure, ensure sufficient working capital exists and monitor the management of risk.
The Group's key financial performance indicators are:
Turnover
Increased by £799k (2.4%) during the year, principally due to increases in advisory fees.
Net assets
Decreased by £15,063k (51%), principally as a result of the settlement made between the Group and HM Revenue & Customs and the introduction of additional shares issued.
Turnover
Increased by £799k (2.4%) during the year, principally due to increases in advisory fees.
Net assets
Decreased by £15,063k (51%), principally as a result of the settlement made between the Group and HM Revenue & Customs and the introduction of additional shares issued.
The Group is exposed to credit risk primarily including deposits held with banks and from trade receivables. The carrying value of cash and trade receivables disclosed in the financial statements represents the maximum exposure at the year end.
The Group also maintains significant liquid resources in the form of cash to meet its working capital requirement.
The Group also maintains significant liquid resources in the form of cash to meet its working capital requirement.
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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
Section 172 of the Companies Act requires directors to take into consideration the interests of stakeholders and other matters in their decision making. The Board considers that the decisions they have made during the financial year and the way they have acted have been in the best interests of stakeholders and related parties, having regard for matters set out in s172(1) (a-f) of the Act.
The Board acts in good faith and in a manner that they consider promotes the long-term success of the business for the benefit of its stakeholders. The directors are constantly exploring opportunities to generate additional business. The company’s key stakeholders are its internal employees, clients, and suppliers. The company engages with its employees, clients and suppliers through several means including:
The Board acts in good faith and in a manner that they consider promotes the long-term success of the business for the benefit of its stakeholders. The directors are constantly exploring opportunities to generate additional business. The company’s key stakeholders are its internal employees, clients, and suppliers. The company engages with its employees, clients and suppliers through several means including:
∙Employees: internal updates on the Group's development, client relationship building, and employee training and development.
∙Clients: providing support and advice to clients to build sustainable long-term business relationships to help them achieve their goals and objectives.
∙Suppliers: Effective communications and updates on contracts to develop sustainable long-term business relationships.
The Group supports community projects and the environment by way of donations and actively encouraging participation in volunteering opportunities. The Group is committed to fulfilling its Environmental, Social and Governance responsibilities across all its client mandates which should have a positive impact in society and the environment. As a Group which includes FCA regulated entities, the directors are aware of their responsibilities to ensure that the Group has sufficient funding and liquidity such that the decision to maintain enough reserves and working capital are always a top priority which ultimately promotes the long-term success of the Group.
This report was approved by the board and signed on its behalf.
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DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2025
The directors present their report and the financial statements for the year ended 31 March 2025.
The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments 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;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to 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.
The directors have considered various stress test scenarios, including a downside scenario, which assumes no revenue growth beyond what is currently contractually due and an inflation rate of 10% throughout the twelve month period following the date the financial statements have been signed. Based on these stress test scenarios, the directors are satisfied that the Group has sufficient cash resources to meet its liabilities as they fall due for the twelve month period from the date the financial statements have been signed.
The directors, therefore, have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and financial statements.
The loss for the year, after taxation and minority interests, amounted to £21,754k (2024 -loss £6k).
No dividends were paid during the year (2024: £NIL).
The directors who served during the year were:
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
The Company's practice has always been to indemnify its directors in accordance with the Company's Articles and to the maximum extent permitted by law. Qualifying third party indemnities, under which the Company has agreed to indemnify the directors, were in force during the financial year and at the date of approval of the financial statements, in accordance with the Company’s Articles and to the maximum extent permitted by law, in respect of all costs, charges, expenses, losses and liabilities which they may incur in or about the execution of their duties for the Company, or any entity which is an associated company (as defined in Section 256 of the Companies Act 2006), or as a result of duties performed by the directors on behalf of the Company or any such associated company.
In accordance with section 414C(11) of the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 the Strategic Report preceding the Directors' Report includes information that would gave formally been included in the engagement with others section of the Directors' Report.
The auditor, Menzies LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CORTX HOLDINGS LIMITED
We have audited the financial statements of Cortx Holdings Limited (the 'Parent Company') and its subsidiaries (the 'Group') for the year ended 31 March 2025, which comprise the Consolidated income statement, the Consolidated statement of financial position, the Company statement of financial position, the Consolidated statement of cash flows, the Consolidated statement of changes in equity, the Company statement of changes in equity and the related notes, 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).
The financial statements do not disclose the nature and amount of a settlement agreement entered into between one of the Group's subsidiaries and HM Revenue & Customs during the year which is a required disclosure under FRS 102. The terms of the settlement are confidential and therefore the amount of the settlement has not been disclosed as this would be prejudicial to the Group subsidiary and the terms under the agreement.
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 Group's or the Parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CORTX HOLDINGS LIMITED (CONTINUED)
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.
As described in the Basis for qualified opinion section of our report, our audit opinion is qualified for non-disclosure of a material litigation settlement. The Strategic report and Directors' report also omits information in respect of the nature and value of the litigation settlement and accordingly we have concluded that the other information is materially misstated for the same reason.
Except for the matter described in the Basis for qualified opinion section of our report, in our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.
Except for the material misstatement described in the Basis for qualified opinion on other matters prescribed by the Companies Act 2006 section of our report, 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 and the Directors' report.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CORTX HOLDINGS LIMITED (CONTINUED)
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 Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
The Group is subject to laws and regulations that directly affect the financial statements including financial reporting legislation. We determined that the following laws and regulations were most significant:
∙The Companies Act 2006;
∙Financial Reporting Standards 102;
∙UK employment legislation;
∙General Data Protection Regulations;
∙Financial Conduct Authority Handbook; and
∙UK tax legislation.
We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
We understood how the Group is complying with those legal and regulatory frameworks by making inquiries to management and those responsible for legal and compliance procedures.
The engagement partner assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations. The assessment did not identify any issues in this area.
We assessed the susceptibility of the Group financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included:
∙Identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud;
∙Understanding how those charged with governance considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process; and
∙Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations.
As a result of the above procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud would be the use of management override of internal controls to manipulate results, or to cause the Group to enter into transactions not in its best interests.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
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 Auditor's report.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CORTX HOLDINGS LIMITED (CONTINUED)
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.
for and on behalf of
Chartered Accountants
Statutory Auditor
95 Gresham Street
EC2V 7AB
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CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 31 MARCH 2025
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CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2025
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 16 to 34 form part of these financial statements.
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COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2025
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 16 to 34 form part of these financial statements.
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