The director presents the strategic report for the year ended 31 August 2025.

During the year ended 31 August 2025, the School’s turnover from ongoing operations decreased slightly, by approximately £49,000 (or 0.9%) to £5.473 million, from £5.522 million in 2024. This follows strong revenue growth in the prior year by some 9.0%.

This small decrease is due primarily to two reasons:

• The absorption of part of the increase in gross fees charged to parents resulting from the Government’s imposition of 20% VAT on independent school fees from 1 January 2025 (this reduced the School’s net fees revenue in the three Pre-Prep year groups over two-thirds of the year, in the spring and summer terms 2025); and

• A somewhat lower, cyclical pupil enrolment, although enrolment has since then once again increased for the current year 2025-26.

Revenue was further reduced compared to the prior year due to the reduction by £46,800 of other operating income resulting from a payout of insurance claims, from £100,000 in 2024 to £53,200 in 2025. These non-recurring payouts from the insurance claims are now complete and will not be repeated in 2026.

At the same time, administrative expenses increased by approximately £177,000. The greatest increases were employee pensions costs (+ £197,000) and staff remuneration (+ £129,000, comprised of wages & salaries and social security costs), reflecting the desire to continue investing into the School’s human resources and capabilities to deliver its high-quality education as well as the steep increase in Employer’s National Insurance Contributions from April 2025. The next greatest increases were advertising (+ £39,000) to continue building the School’s already strong brand equity, as well as irrecoverable VAT (+ £38,000). These increases were partially offset by a number of declining expense items, with the greatest being legal & professional fees (- £59,000), followed by materials & consumables (- £54,000).

Combined with finance costs having fallen by about £72,000 due to the reducing balance of bank loans resulting from ongoing repayment as well as declining interest rates, and a small change in investment income (- £6,000), profit before other gains and losses materialised at £161,860 (or about £205,000 less than the prior year’s £367,432, for the reasons explained above). Taking all circumstances into account, the director is pleased with the profit achieved in 2025 from ordinary activities.

Property valuations

Beyond the School’s ordinary activities, we must this year also consider other, non-trading accounting gains and losses which stem from the professional valuations undertaken as at 31 August 2025 of the School’s freehold and long leasehold properties. These were necessary to comply with the applicable Financial Reporting Standard (FRS 102), which requires such professional valuations to be undertaken on a periodic basis to ensure that the carrying value in the financial statements is maintained at fair market value.

The freehold property at 99 Herne Hill was revalued at £3.930 million, which crystallised a loss for accounting purposes of £675,763, in comparison with the property’s book value. Under the provisions of FRS 102, this reduction in the market value of the property is charged in the Company’s Statement of Comprehensive Income as a loss, even though this is an unrealised loss.

As a consequence, the Statement of Comprehensive Income shows a loss before taxation in 2025 of £513,903, compared with the prior year’s profit of £367,432. After deduction of corporation tax of some £121,000 (a decrease of £64,000 from 185,000 in 2024), this resulted in an after-tax loss for 2025 of £634,707 (compared with the after-tax profit of £182,475 achieved in 2024).

The long leasehold at 127 Herne Hill, including the smaller freehold parcel of woodland area above Carver Road, was revalued at £11.140 million. This crystallised a gain, for accounting purposes, of £3.300 million, in comparison with the book value of the property. According to the provisions of FRS 102, this increase in the market value of the property has been added to the Revaluation Reserve in the Company’s Statement of Financial Position. It is also shown on the Statement of Comprehensive Income as ‘Other comprehensive income’ from the ‘Revaluation of property, plant and equipment’. This then results in ‘Total comprehensive income for the year’ in 2025 of some £2.665 million.

As for virtually any company worldwide, the economic and political environment in which the School operates has undeniably become more uncertain and less predictable. Who could have foreseen some of the major events the School has faced over just the past 5 years? They, and the significant challenges they posed (and in several instances continue to pose), have included:

• The Covid lockdowns, with their inherent difficulties to keep parents and staff on side for homeschooling of very young children and promoting the School without tours or open mornings; 

• Inflationary cost pressures and spiking interest rates following Russia's invasion of Ukraine, just when the School had taken on substantial debt to acquire and refurbish the 99 Herne Hill Kindergarten site; 

• The imposition of VAT on independent school fees from January 2025; 

• The steep increase in Employer's National Insurance Contributions from April 2025;

• Flatlining UK economic performance and lack of household disposable income growth; 

• Unfavourable demographics with reducing numbers of children in London boroughs; and

• Changes in the local schools’ landscape such as Rosemead merging with St. Dunstan's and, more recently in June 2025, Alleyn's acquiring Oakfield. 

Whilst not all of these uncertainties and their associated risks are behind us, it nevertheless feels that some of the heaviest storms have passed and that the School has weathered them successfully. Regularly responding to unforeseen challenges has in many ways become the new normal, and the School is well equipped to continue doing so effectively in the future.

Still, hard-to-predict new challenges will undoubtedly emerge in this world of heightened uncertainty. As a case in point, the recently started US and Israel war against Iran has, of course, created a myriad of new uncertainties in terms of a potential rise in the rate of inflation, undermining the expected reduction of interest rates, the adverse impact on economic growth, etc.

We must therefore continue to closely monitor any new developments, mitigating the risks they pose but also seizing any opportunities they frequently also present. For example, the imposition of VAT could ultimately have the impact of convincing more parents to invest in their child’s early years education and then dip in and out of state and private schooling. Similarly, although the rapid increase in the number of children with special educational needs creates a host of teaching and learning challenges that can easily drive up staffing costs, they also offer an opportunity for differentiated, individualised learning and development in an inclusive environment – something for which Herne Hill School is well known and for which parents of children with special needs may well be willing to pay additionally.

The fact that the School has continued to perform satisfactorily in spite of the significant challenges described above is testimony to its resilience. Although details are difficult to obtain, anecdotal evidence points to the School gaining market share. The director attributes this to several factors.

Firstly, there has been a discernable trend that both prospective parents and society at large are increasingly recognising that Early Childhood Education (ECE) is the most important educational period in a child’s life, and that it requires a specialised curriculum and pedagogical approach. The School has been perfectly placed to benefit from this trend as, unusually for England, its provision for children aged 2+ to 7+ coincides exactly with the ECE years.

Furthermore, this focused positioning as an ECE centre of excellence is enhanced by the School’s reputation for the high quality of its provision. It is built on the School’s highly suitable facilities, the know-how accumulated over 50 years of experience since its foundation in 1976, and most importantly its expert and dedicated staff, overseen by a strong middle leadership team.

In turn, these assets form the basis from which the School is able to continue innovating and evolving its curriculum whilst remaining true to its identity and ethos, thereby further strengthening its reputation.

As a consequence, the director is confident that the School is well placed to continue performing favourably, even in the uncertain times in which we live, as premium quality educational provision during a child’s most formative years is likely to remain the last expenditure parents may be prepared to sacrifice.

The company considers its primary key performance indicators to be turnover, operating profit and profit on ordinary activities after taxation.

On behalf of the board

The director presents his annual report and financial statements for the year ended 31 August 2025.

The principal activity of the company continued to be that of the provision of nursery and pre-preparatory education.

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

No ordinary dividends were paid. The director does not recommend payment of a final dividend.

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

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

The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is 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 director is 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. He is 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.

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of exposure to business risks and credit risks.

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.

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

We have audited the financial statements of Herne Hill School Limited (the 'company') for the year ended 31 August 2025 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the statement of cash flows 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 August 2025 and of its 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 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 director's 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 director 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 director is 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 director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• the strategic report and the director's 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 director's 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 director's 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 director's responsibilities statement, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has 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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Extent to which the audit was considered capable of detecting irregularities, including fraud

The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and its management.

Our approach was as follows:

• We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience, and through discussion with the directors and other management (as required by auditing standards), and discussed with the directors and other management the policies and procedures regarding compliance with laws and regulations;

• We considered the legal and regulatory frameworks directly applicable to the financial statements reporting framework (FRS 102 and the Companies Act 2006) and the relevant tax compliance regulations in the UK;

• We considered the nature of the industry, the control environment and business performance, including the key drivers for management’s remuneration;

• We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit;

• We considered the procedures and controls that the company has established to address risks identified, or that otherwise prevent, deter and detect fraud; and how senior management monitors those programmes and controls.

Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These procedures included: testing manual journals; reviewing the financial statement disclosures and testing to supporting documentation; performing analytical procedures; and enquiring of management, and were designed to provide reasonable assurance that the financial statements were free from fraud or error.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/Our-Work/Audit/Audit-and-assurance/Standards-and-guidance/Standards-and-guidance-for-auditors/Auditors-responsibilities-for-audit/Description-of-auditors-responsibilities-for-audit.aspx. This description forms part of our auditor’s report.

This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.

The income statement has been prepared on the basis that all operations are continuing operations.

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

Herne Hill School Limited is a private company limited by shares incorporated in England and Wales. The registered office is The Old Vicarage, 127 Herne Hill, London, SE24 9LY.

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 £.

The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

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

Revenue is recognised at the fair value of the school fees received or receivable in the normal course of business. School fees are received in advance and recognised in the school year to which they relate with any fees not relating to the school year being included in deferred income.

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life.

Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

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

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

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

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

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

Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.

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

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

Other financial assets, 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.

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

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

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

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

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.

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

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 income statement 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.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

The costs of short-term employee benefits are recognised as a liability and an expense.

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

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

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

In the application of the company’s accounting policies, the director is 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.

In the opinion of the directors there are no significant judgements or areas of estimation uncertainty.

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

Their aggregate remuneration comprised:

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

Freehold land and buildings with a carrying amount of £3,930,000 (2024 - £4,647,220) have been pledged to secure borrowings of the company. The company is not allowed to pledge these assets as security for other borrowings or to sell them to another entity.

Leasehold land and buildings with a carrying amount of £11,140,000 (2024 - £8,084,061) have been pledged to secure borrowings of the company. The company is not allowed to pledge these assets as security for other borrowings or to sell them to another entity.

The freehold land and buildings were valued at £3,930,000 on an open market basis by James Portugal, chartered surveyors and property consultants on 15 October 2025.

The leasehold land and buildings were valued at £11,140,000 on an open market basis by James Portugal, chartered surveyors and property consultants on 15 October 2025.

If these properties were sold for their revalued amounts it would be necessary to replace them with similar property, and rollover relief against tax on the gain would be available. Accordingly, no timing differences arise and no provision has been made for deferred tax in respect of the revaluation.

Land and buildings are carried at valuation. If land and buildings were measured using the cost model, the carrying amounts would have been approximately £6,259,533 (2024 - £6,545,063), being cost £8,974,142 (2024 - £8,974,142) and depreciation £2,714,609 (2024 - £2,429,079).

The long-term loans are secured by fixed and floating charges over the assets of the company.

The repayment term for the bank loan of £1.5m is 25 years at an interest rate of 2.0% above base per annum. The repayment term for the bank loan of £1.4m is 25 years at an interest rate of 2.0% above base per annum. The repayment term for the bank loan of £2.0m is 25 years at an interest rate of 2.0% above base per annum. The repayment term for the bank loan of £1.1m is 23 years at an interest rate of 2.5% above base per annum.

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

The deferred tax liability set out above is expected to reverse in the future.

The company operates a defined contribution Workplace Pension Scheme for all qualifying employees and also contributes to the defined benefit Teachers Pension Scheme for some of its qualifying employees. The assets of the schemes are held separately from those of the company in independently administered funds.

The company has provided a first legal charge, dated 9 May 2019, to HSBC UK Bank PLC over the freehold property known as 99 Herne Hill, London, SE24 9LY, as security against any debt due to the bank.

The company has provided a debenture, dated 11 December 2002 to HSBC UK Bank PLC by way of a fixed and floating charge over the undertaking and all property and assets, present and future, as security against any debt due to the bank.

The company has provided a first legal charge, dated 9 March 1995, to HSBC UK Bank PLC over the leasehold property known as The Vicarage, 127 Herne Hill, London, SE24 9LY, as security against any debt due to the bank.

The company has provided a fixed and floating charge, dated 9 March 1995 to HSBC UK Bank PLC over the undertaking and all property and assets, present and future, as security against any debt due to the bank.

The ultimate parent company is Dunsford Early Childhood Education Limited, a company incorporated in the United Kingdom. Its registered office is The Old Vicarage, 127 Herne Hill, London, SE24 9LY.

The ultimate controlling party is D Magyar