Northern Gritstone Annual Report 2025

| BOW

| Phlux | Silveray

| MicroLub

A selection of the teams backed by Northern Gritstone

| Exciting Instruments

Our vision

Northern Gritstone was founded with the philosophy of Profit with Purpose, which means we believe that profitable organisations can and should have a wider purpose.

That purpose for us is to support aspiration and ambition in the North of England, and in doing so create positive societal and economic impact. Profit means delivering attractive returns to our shareholders, who have the patient capital to invest into an untapped innovation seam in the North of England and benefit from the returns of the world-class companies of tomorrow.

How do we do that? By creating change.

We invest in and support the commercialisation of science and technology-enabled IP-rich businesses based in the North of England — predominantly originating from the Northern Arc universities of Leeds, Liverpool, Manchester and Sheffield. We work incredibly closely with these universities, with whom we have in place long-term agreements. We also invest in early-stage companies based in the North of England outside of these universities. Since our inception, Northern Gritstone and co-investors

have invested £366 million into science and technology-enabled early-stage businesses based in the North of England.

These investments are in some of the UK’s most exciting emerging sectors such as pioneering life-science, advanced materials, health technology, clean technology, cognitive computation and artificial intelligence.

In doing so, we are helping to create a leading ecosystem of funding and support. Over time this creates a virtuous circle. And that is our belief and our mission — to create a virtuous circle of investee companies, who bring people to the region including other investors and community members, who lean in and help others on their journey. This in turn generates high-skilled jobs in the North of England. That local impact has a regional and ultimately global impact through the creation of world-class innovative businesses.

High-paid job creation

Skilled workers & companies relocate to the region

Investee companies launch

PROFIT WITH PURPOSE

North of England

A new Silicon Valley

Region recognised as an innovation leader

Northern Gritstone invests and supports

New funders enter the region

NORTH OF ENGLAND

& Committed Co-investment into the North of England

Strategic Report

Chairperson’s statement

It gives me great pleasure to report on another successful year for Northern Gritstone.

We have seen strong momentum and progress within our portfolio, which now stands at 32 companies, whose ambitious leaders are meeting key milestones including attracting highcalibre talent into the region. Notably, this year two entities in our existing portfolio (Phlux and Silveray) have attracted follow on-funding at a premium to our existing investment, providing strong validation of our strategy.

Northern Gritstone has continued to deploy its Profit with Purpose strategy, supporting innovation and growth within the Northern ecosystem. I am very pleased that we have strengthened our relationships within the Liverpool City region, including with the University of Liverpool, with whom we signed a partnership agreement in May 2025. I look forward to reporting on the additional spinout investments which are the aim of this partnership. The addition of the University of Liverpool to Northern Gritstone’s

existing university partners of Leeds, Manchester and Sheffield means that Northern Gritstone is now working with a group of universities which collectively produce more spinouts annually and have higher research income than any other Higher Education institute in the UK — a superb opportunity for growth.

Northern Gritstone has established a strong reputation, and as a result, during the year we attracted numerous investment offers. Consequently, in March 25, we successfully secured an additional £50 million in capital, bringing the total capital commitments to £362 million. We were pleased once again to receive support from regional local authority pension funds as well as institutional investors and high-net-worth individuals.

It is my pleasure to welcome Paddy Dowdall, who joined the Board of Directors as a Non-Executive Director on 1 April 2025. Paddy is Assistant

Executive Director of the Greater Manchester Pension Fund, and his extensive investment experience will be a valuable addition to the Northern Gritstone team.

Northern Gritstone continues to find numerous opportunities to allocate capital. During the year, Northern Gritstone invested in 8 new companies, including 6 spinouts from the Founding Universities of Leeds, Manchester, and Sheffield.

" WE WERE PLEASED ONCE AGAIN TO RECEIVE SUPPORT FROM REGIONAL LOCAL AUTHORITY PENSION FUNDS AS WELL AS INSTITUTIONAL INVESTORS AND HIGH-NET-WORTH

during the year, providing the ‘+++’ to support our portfolio companies to grow quickly and sustainably. NG Innovation Services continues to expand and already includes established talent and business support services functions, as we report on page 26.

Last year, I reported on the launch of NG Studios powered by Deeptech Labs, aimed at accelerating deep-tech early-stage spinouts from the Founding Universities. During this financial year, two cohorts completed the program, benefiting from 1-2-1 mentoring and networking with industry experts. The goal is to help founders turn their ideas into investible opportunities, and I am pleased to report that Northern Gritstone has further invested in 5 participants in the program to date.

The third NG Studios cohort program is currently in progress and is scheduled for completion in July, with presentations from the cohort members to be featured at our Annual General Meeting and Innovation Showcase. We are pleased to announce that this cohort, as well as future cohorts, will incorporate earlystage spinouts from the University of Liverpool.

In the Purpose and Impact report on pages 38 to 51, we detail how our portfolio companies contribute to job creation in the region and align their activities with the UN-backed Sustainable Development Goals (SDGs), indicating their potential global impact. NG Innovation Services launched

On a final note, we are all acutely aware that profound economic and trade shifts are happening. Northern Gritstone is nothing if not resilient and determined to weather any storm. I would like to extend my gratitude to the Board of Directors and the entire Northern Gritstone team, who show true grit. They should take great pride in all that has been accomplished this year.

Lord Jim O’Neill CHAIRPERSON

Chief Executive’s statement

The last twelve months has seen our business start to season as our initial portfolio begins to mature and our first follow-on investment decisions have been made. Our investment team has established itself as a core component of the Northern Arc tech ecosystem and with the power of NG Innovation Services completing our ‘Capital+++ model’, we now have the ability to help our founders reach their goals quicker and in better shape.

We have a number of emerging stars in our portfolio which have raised sensible follow-on rounds in the year which highlights both how good a business needs to be to raise capital in the current market but also the depth of opportunity we enjoy in the North of England. Phlux, which designs and manufactures ultralow-noise infrared sensors, raised a £9 million Series A round from both new and existing shareholders at a sensible uplift which will see the business scale

its Sheffield based operations. Silveray, which has developed a novel X-ray material, raised a £4 million Seed-plus round, again at an attractive uplift in value from the previous round, allowing it to continue to develop its technology in conjunction with its initial customers.

On the back of Northern Gritstone’s successful development to date, we were delighted to close out an additional fundraise for our own

balance sheet in the year. We welcomed two new shareholders: Fulcrum Asset Management; and Aviva PLC; as well as three existing shareholders increasing their current shareholdings: Greater Manchester Pension Fund; Merseyside Pension Fund; and West Yorkshire Pension Fund. Northern Gritstone now enjoys c.£362 million of committed capital.

Our team has continued to build over the course of the year with new resource in our investment team matching the build in NG Innovation Services alongside our middle and back office teams which are so invaluable in providing the foundations on which we operate our business. Mid-way through the year, our wholly owned subsidiary, Northern Gritstone Investment Manager Limited, became regulated giving us the optionality to raise more traditional GP / LP funds alongside our permanent capital when market conditions permit.

this market will not impact our portfolio. From insulating our portfolio we can quickly turn to what opportunities the current dislocation can present to Northern Gritstone and our investees and this is where we are now focused.

"WE HAVE A NUMBER OF EMERGING STARS IN OUR PORTFOLIO"

Market conditions have not been as favourable as we had anticipated a year ago. There has been a large impact from the administration change in the US, not just in the early-stage venture world, but one felt much more widely. A private markets’ world which was steadily moving towards ‘risk-on’ up until January 2025 has now gone quickly into reverse as significant uncertainty has entered the world financial system. By focusing on quality and ensuring that our investee companies are built on solid foundations, we hope that the worst of

We are blessed to have a diverse and skilled team at Northern Gritstone along with an engaged Board of Directors. I would like to thank everyone for their efforts this year and in making our business such an enjoyable place to work.

Duncan Johnson CHIEF EXECUTIVE OFFICER

13 June 2025

Portfolio update

The Company made 8 new investments and 7 follow-on investments in the period, deploying a total of:

£21.9m

The fair value of the portfolio at 31 March 2025 was:

£56.7m

During the period there was a change in the fair value of investments of:

£(6.5) m

This change is largely the result of investment fair value movements of two investments, where the reduction in carrying value reflects the short funding horizons of these businesses. It is the nature of our valuation process that we adopt a prudent approach when making these judgements as required by our Valuation policy, but we remain excited by the potential for these businesses. In addition, C-Capture ceased trading in the period, having failed to attract the funds necessary to continue operations. Consequently, the fair value of Northern Gritstone’s investment in the company was nil at 31 March 2025, with a £(1.3)m negative fair value movement recognised in the year.

All other investments are making progress executing their respective strategies as set out at the time of investment. We remain pleased with the companies in which we have invested and their potential to deliver both profit and purpose.

In the past year we expanded our portfolio of IP-rich knowledge-intensive companies, including graduates from our accelerator program NG Studios, and supported existing portfolio companies with their growth ambitions. Highlights from this activity include (shown opposite):

FOLLOW-ON INVESTMENTS

Phlux

Phlux is a spinout from the University of Sheffield. The company designs and manufactures ultra-low-noise infrared sensors with best-in-class performance. Since Northern Gritstone’s original investment in November 2022 the company has launched its first product — Aura — a drop-in replacement for Lidar systems, secured its first design win and delivered its first revenues. In March 2025, it raised £9 million in a Series A round in which Northern Gritstone invested alongside existing funders and a new investor, BGF. The Series A was priced at a significant premium to the Seed round in which Northern Gritstone had originally invested. We are delighted to support the continued success of a business which is delivering on its ambition to be a leader in its field.

Silveray

In November 2024, we reinvested at an uplifted valuation into existing portfolio company Silveray’s Seed+ round, along with new investors Empirical Ventures and Hamamatsu. Silveray — based in Manchester — is transforming radiography through digitisation and its ‘bendy’ X-ray material that can wrap around pipes and be fed into tight, awkward spaces. Applications range from industrial inspections — checking for corrosion or damage — to the health sector where mammograms could be made much more comfortable.

FOLLOW-ON INVESTMENTS INTO NG STUDIOS PARTICIPANTS

Bettering Our Worlds (BOW)

In December 2024, we invested in BOW, a Sheffield spinout that simplifies robotics programming through its universal software platform and Software Development Kit (SDK). BOW’s mission is to make robotics more accessible by allowing developers to program various types of robots using

their preferred programming languages and operating systems. By lowering the barriers to robotics programming, BOW aims to unlock new possibilities in industries such as manufacturing, healthcare, and education.

Exciting Instruments

In November 2024, we led Exciting Instruments’ Seed round. The company, which is a spinout from the University of Sheffield, has developed a practical and efficient single-molecule detection platform, opening up adoption to an unconstrained user base spanning pharma, healthcare and other industrial applications. The technology allows users to visualise and analyse individual molecules and their interactions, whilst also providing high throughput processing and automation of analytics — advancements that are critical for improved efficiency and productivity.

MicroLub

In October 2024, we led a Seed round in Leeds spinout MicroLub. The company has developed food ingredients technology using waterbased ‘scaffolds’ coated with polysaccharides to replicate the creamy texture of fats and oils. This technology allows for a significant reduction in fat content and calories without compromising sensory qualities such as taste and texture. It has applications across various food categories, including reduced-fat dairy products, baked goods, and plant-based meats.

Cavero Quantum

In June 2024, we participated in Cavero Quantum’s Seed round. A Leeds spinout, Cavero has created a quantum-safe cryptography and encryption technology for secure mutual key generation and authentication. The technology replaces multi-factor authentication and one-time passwords. With cyber attacks estimated to cost the global economy £5.5 billion per year, demand for Cavero Quantum’s technology is expected to increase as existing cryptographic methods become more vulnerable to quantum computers.

NEW INVESTMENTS

Apini Therapeutics

In March 2025, we invested into Apini, a University of Manchester spinout developing small molecule compounds to target chronic inflammatory diseases such as Crohn’s and Ulcerative Colitis. Apini is based on the groundbreaking work of its founder Dr Sam Butterworth, the inventor of Tagrisso, a life-saving drug for epidermal growth factor receptor mutant lung cancer.

Partful

In November 2024, we invested in the Series A round of Partful — a Manchesterbased manufacturing aftersales technology solution provider. Partful has developed a 3D SaaS platform of interactive models that ‘explode’ to reveal a product’s individual components. This makes it easier for the customers and dealers of original equipment manufacturers (OEMs) to identify and order the components they need and access the work instructions needed to fit them.

Literal Labs

In December 2024, we invested in our first Newcastle spinout Literal Labs, which is pioneering logic-based AI models that are orders of magnitude faster and more energy efficient than existing neural networks. Its approach is inspired by the work of Mikhail Tsetlin; a mathematician and contemporary of John Macarthy who pioneered neural networks. Like neural networks, the Tsetlin machine can perform complex machine learning training. However, unlike neural networks, it is based on propositional logic which makes it more efficient in terms of computation and energy usage, whilst speeding up inferencing.

Investments were also made in five participants in the second NG Studios cohort.

Profiles of Northern Gritstone’s top 10 holdings by carrying value appear on pages 15 to 24.

KEY INFORMATION

• Pragmatic was founded in 2010, and at inception, acquired IP from Manchester University.

• The company has developed a process for making thin-film semiconductors on flexible substrates. This enables the production of ultra low-cost integrated circuits that are faster to produce than silicon chips with a significantly lower carbon footprint.

• The initial target application is chips for radio frequency labels to enable products to be identified and tracked around the globe.

• Pragmatic is using investment to build a semiconductor manufacturing plant in North-East England.

KEY INVESTMENT HIGHLIGHTS

Marketing & scaling opportunity

• Pragmatic is initially disrupting the radio frequency identification (‘RFID’) market — its low-cost chips are predicted to expand the market 5x to $50bn per annum.

IP & barriers to entry

• Pragmatic has over 200 patents and extensive know-how and trade secrets around the manufacturing process of thin film transistors.

Productisation & pipeline

• The company is currently selling its first product (an RFID barcode) and plans to launch soon 2 additional smart-RFID products.

• The company also supplies foundry services to customers outside the RFID market.

Management team

• David Moore, CEO, 20+ experience in the semiconductor industry, ex-Micron, ex-Intel.

• Board Includes Non-Executive Directors from Cambridge Innovation Capital, M&G, ARM, Avery Dennison, Nordic Semiconductor & UKIB. pragmaticsemi.com

INVESTMENT DETAILS

Northern Gritstone equity held

Return to date:

PURPOSE AND IMPACT

£7.5 m n/a 2%

Current valuation

1.0 x

Multiple of money invested

Internal rate of return

Key co-investors include: M&G, UK Infrastructure Bank, Aramco and Cambridge Innovation Capital.

Industry, Innovation & Infrastructure RFID tags can digitise the supply chain, improve quality control and authentication of products.

Responsible Consumption & Production

The company has dramatically reduced the amount of energy and water needed to manufacture semiconductor chips.

Job Creation

A high number of new skilled jobs based in the North of England to be generated through this investment.

KEY INFORMATION

• Optalysys has developed a hardware solution that enables processing of encrypted data to be performed at speeds equivalent to that of unencrypted data (c.1 million times faster), allowing companies to maintain data security whilst sharing and collaborating with confidential data. This process is known as Fully Homomorphic Encryption (FHE).

• The market-creating technology is based on Optical Fourier Transforms in which founder Dr Nick New has >20 years commercial experience.

• The business model is to develop a server mounted unit that can be sold to cloud providers to enable secure cloud base analysis of data using FHE.

KEY INVESTMENT HIGHLIGHTS

Marketing & scaling opportunity

• FHE is potentially a multi-billion-dollar market and has longevity through being quantum-secure.

• Optalysys is working with software developers to fully enable the market.

IP & barriers to entry

• Optalysys’ optical solution is the only method that delivers performance and low-power consumption.

• 10 relevant patent families registered, with the 4 core patent areas at late patent approval stage.

Productisation & pipeline

• Revenue model will be a blend of infrastructure-asa-service, hardware sales and license models.

Management team

• Dr Nick New (CEO) — PhD from Cambridge University in Optical Pattern Recognition.

• Robert Todd (CTO) — 30 years experience in the optical industry. Previous company supplied precision optical systems to CERN.

• Dipesh Patel (Chair) — former CTO of Arm.

optalysys.com

Good Health & Wellbeing Potential in the healthcare industry to improve diagnostics and treatment.

Peace, Justice & Institutions

Protecting sensitive intelligence data preserves peace. Technology can be used to prevent financial fraud and identity theft.

Job Creation

A high number of new skilled jobs based in the North of England to be generated through this investment.

KEY INFORMATION

• Founded in 2020, Phlux has developed a patented, highly sensitive semiconductor material with best-in-class performance for sensing and communication systems.

• Phlux is a spinout company from the University of Sheffield and is based in Sheffield.

• Since the seed investment, the company has launched its first product — Aura — a drop-in replacement for Lidar systems, secured its first design win and delivered its first revenues.

• The company recently raised a £9m Series A round, which it will use to launch a new range of products, transfer fabrication to Taiwan and establish sales and distribution channels in the US.

KEY INVESTMENT HIGHLIGHTS

Marketing & scaling opportunity

• Phlux’s novel semiconductor material has many end markets such as LIDAR and Optical Communications, combined offer a TAM of $8.1bn.

IP & barriers to entry

• The core of Phlux’s IP lies in the formulation and application of its novel material, protected by multiple patent families.

Productisation & pipeline

• The company have secured its first design win and has a strong sales pipeline. It also has Letters of Intent regarding its optical comms product from two large multi-nationals.

Management team

• CEO Dr Ben White, technical founder with 3 patents filed on Phlux’s technology.

• Chair, David Crisp, an experienced chair who has raised VC funding.

• VP BD, Christian Rookes, 25 years' experience & set up product lines with >1bn capacity.

phluxtechnology.com

PURPOSE

AND IMPACT

Climate Action

Phlux’s products can reduce processing power from 0.8 Watts to 0.3 Watts. Other climate applications include measuring methane gas.

Industry, Innovation and Infrastructure

Improving value proposition of high-value sensing devices and high-speed communications.

Job Creation

Bringing high-skilled jobs to the North of England, both retaining talent within region and attracting talent to the region from elsewhere.

KEY INFORMATION

• Phagenesis spun out of the University of Manchester in 2007, following 18 years of research carried out by Shaheen Hamdy (CSO) during his time there.

• The company has developed a medical technology — Phagenyx — to treat dysphagia (difficulty swallowing). Phagenyx is a temporary therapy (i.e. no implant or surgery) which permanently restores swallowing across 3x 10-minute treatments, improving patient outcomes and reducing hospital length of stay by as much as 13 days, saving hospitals $6k/day in ICU bedspace costs.

• The device is CE-marked and FDAapproved. 15 clinical studies on 800+ patients have been completed, as well as the treatment of 300+ patients.

phagenesis.com

Northern Gritstone equity held

Return to date:

1.0 x

Multiple of money invested

KEY INVESTMENT HIGHLIGHTS

Marketing & scaling opportunity

• Phagenyx is approved for use in the treatment of post-stroke dysphagia. In itself, this is a large market with significant unmet need. Beyond this, the same product can be used in additional large markets such as post-ventilation dysphagia therapy.

IP & barriers to entry

• Phagenesis has a substantial portfolio of patents which sit alongside know-how, clinical evidence, and regulatory approvals which act as a ‘moat’ of protection around the market opportunity.

Productisation & pipeline

• Strong sales in Europe are demonstrative of market pull and adoption. The data and clinical confidence generated in Europe will be used to support global growth efforts, with US market growth building.

Management team

• Phagenesis is Chaired by veteran medtech entrepreneur Oern Stuge, who has overseen multiple, large exits as Chair.

• CEO Chad Hoskins is an experienced medtech startup CEO with expertise in scaling companies and US sales and marketing.

PURPOSE AND IMPACT

Current valuation

Internal rate of return

Key co-investors include: EQT, Sectoral, BPC, Aphelion Capital, Nestle.

Good Health & Wellbeing

Patient outcomes are improved as the technology enables faster recovery and treats the cause of dysphagia — not just the symptoms.

Climate Action

Phagenyx eliminates the need for assisted feeding, and by association the use of single-use plastics.

Job Creation

New skilled jobs based in the North of England will be generated through this investment.

KEY INFORMATION

• Exciting Instruments is a University of Sheffield spinout from the lab of Professor Tim Craggs.

• The Company’s technology — the EI-FLEX — is a bench-top scientific instrument which enables high resolution study of single molecules.

• To date, the company has generated revenues via sales of a version 1 device into academic institutes. Beyond this, the same core technology has utility in pharmaceutical markets.

• Two Big Pharma customers are currently using the company’s technology to understand the conformation and binding mechanisms of ‘blockbuster’ drugs in their drug discovery development pipelines. This is information currently unavailable to pharma via incumbent tools.

excitinginstruments.com

KEY INVESTMENT HIGHLIGHTS

Marketing & scaling opportunity

• Exciting Instruments’ solution has multiple end market applications including academic research, pharmaceutical drug discovery and diagnostics –an expected $40bn TAM by 2031.

IP & barriers to entry

• The Company’s technology is pioneering.

• One patent filed and a further four patent submissions in the pipeline.

Productisation & pipeline

• Exciting Instruments has a diverse set of potential revenue streams across multiple markets, encompassing; unit sales, SaaS licenses, consumables.

Management team

• Tim Craggs is a highly respected academic in this space. Strong commercial team in place being augmented by board level appointments of individuals ex-Abcam and ex-ThermoFisher.

PURPOSE AND IMPACT

Good Health & Wellbeing

The product will be used with the ultimate goal of improving good health and wellbeing via the development of new drugs.

Decent Work & Economic Growth

Multiple of money

Return to date: Key co-investors include:

Bringing high-skilled jobs to the North of England, both retaining talent within region and attracting talent to the region from elsewhere.

Industry, Innovation & Infrastructure

The democratization of single molecule analysis facilitates innovation across multiple industries.

KEY INFORMATION

• A spinout of the University of Sheffield, Crucible is developing advanced therapies to treat central nervous system conditions with high unmet needs, beginning with Amyotrophic lateral sclerosis (ALS) and Frontotemporal dementia (FTD).

• Crucible has developed CGT-01, a gene therapy administered in a single injection to the cerebrospinal fluid, which uses an adeno-associated virus (AVV) to silence the SRSF1 gene, thought to be an underlying cause of some forms of ALS / FTD.

• CGT-01 aims to prevent neurotoxicity and motor neuron death and early pre-clinical data in mice and human derived neuronal cells shows the technology working — the first of its kind targeting the SRSF1 gene.

crucible-tx.com

Return to date:

x

Multiple of money invested

Key co-investors include: ArgoBio.

%

m

KEY INVESTMENT HIGHLIGHTS

Marketing & scaling opportunity

• Large unmet need in ALS / FTD with 2,500 cases annually and a market of £2.5bn.

IP & barriers to entry

• Technology is patented and European based clinical trials are being discussed with the UK regulator with plans to host the trials at Sheffield University, where a new gene therapy manufacturing centre has been built.

Productisation & pipeline

• Tranched investment with proof of concept, regulatory approvals and clinical trial design the end goals.

Management team

• Prof. Dame Pamela Shaw — world leading clinician in ALS and Dr Mimoun Azzouz — world renowned for AAV gene therapy work.

• Prof. Guillaume Hautbergue (CTO) — expert in translational RNA biology.

• ArgoBio — therapeutics focussed investment entity — providing the Chair (Neil Mackenzie) and COO (Jonathan Foley).

PURPOSE AND IMPACT

Good Health & Wellbeing

Crucible aims to save lives or significantly improve the quality and duration of lives in those that would otherwise die from conditions for which no efficacious treatments exist.

Job Creation

A high number of new skilled jobs based in the North of England to be generated through this investment.

KEY INFORMATION

• adsilico is a University of Leeds spinout, built on 15+ years of research and £10m+ of non-dilutive funding.

• The company is building an end-to-end solution for medtech companies to run insilico trials (‘ISTs’). ISTs use computational models and simulations to assess safety, efficacy and performance of medical devices ahead of real world human clinical trials. They also reduce the need for animal experimentation.

• The solution will comprise 3 core services; virtual populations, IST execution (virtual experiments simulating a medical intervention), and digital evidence (simulation results to inform device design).

KEY INVESTMENT HIGHLIGHTS

Marketing & scaling opportunity

• Regulatory bodies have recently accepted in-silico data in place of animal testing. In-silico businesses have seen successful uptake in the pharma industry, demonstrating utility, enterprise value build, and large exit multiples.

IP & barriers to entry

• adsilico has a filed patent and others are in the pipeline. The reputation of Prof. Frangi is an additional barrier to competition.

Productisation & pipeline

• The medical devices industry is demanding solutions to reduce the cost of trials and device re-calls. adsilico is well positioned to deliver this at scale and is already engaged with a big player in the industry in a commercial partnership.

Management team

• Founder, Prof. Alex Frangi, is a high-profile opinion leader on computational medicine and ISTs with Chair and Director positions in leading academic and professional institutes.

• CEO and Co-founder Sheena Macpherson.

adsilico.uk

INVESTMENT DETAILS

• Chris Richardson (Chair) — a veteran in implantable medical device start-ups.

PURPOSE AND IMPACT

Good Health & Wellbeing

The platform will enable more cost efficient and safer development of medical devices.

Job Creation

Multiple of money invested

£2.7m 30% 30% 1.3x Current valuation Internal rate of return Northern Gritstone equity held

Return to date: Key co-investors include: Parkwalk Advisors.

New skilled jobs based in the North of England will be generated through this Investment.

KEY INFORMATION

• BOW is a spinout from the University of Sheffield. The company is developing a toolkit to democratise robotics software development. Its cross-platform, crossrobot solution opens robotics programming to all software developers by making it possible to code in any programming language and to deploy that code on any robot, making the development of robotic applications quicker, easier and more cost effective.

• Robotics software enables robots to function and operate and to integrate within an environment. The global robotics software market is forecast to grow to $50bn by 2032.

Marketing & scaling opportunity

• Versatile robotics for dynamic environments are expected to outperform traditional fixed-task systems, opening up a multi-billion dollar market.

• BOW is well-positioned to seize this opportunity, providing developers with easy-to-use tools for creating adaptable robotic solutions.

IP & barriers to entry

• BOW’s approach to decoupling robotic hardware and software based on years of research in cognitive behaviour and natural intelligence is hard to replicate and differentiates them in the market.

• Trade secrets held over the fundamental techniques that make this possible.

Productisation & pipeline

• BOW provides the tools that open robotic development to a wider pool of software developers, leading to applications across the entire robotics ecosystem.

• Focus is on building a developer community whilst embedding the software with key OEM partners.

usebow.com

INVESTMENT DETAILS

22 %

Northern Gritstone equity held

1.0 x

Multiple of money invested Return to date:

Management team

• CEO Nick Thompson has previously built a software company to £22m revenue before a PE exit.

• Chair Liz Upton is one of the founders of Raspberry Pi where she focused on community and ecosystem development, key areas of importance for BOW.

Current valuation

£2.6 m 4 %

Internal rate of return

PURPOSE

AND IMPACT

Decent Work & Economic Growth

New jobs based in the North of England to be created through this investment.

Industry, Innovation & Infrastructure

By reducing the complexity and cost of robotic development, BOW supports increased innovation and the development of scalable infrastructures within the robotics sector.

KEY INVESTMENT HIGHLIGHTS

KEY INFORMATION

• Partful is a 7-year-old Manchester based company that develops software products to enable Original Equipment Manufacturers (‘OEMs’) to rapidly generate 3D interactive parts catalogues and work instructions from diverse data sets, for their engineers, dealerships and customers.

• The software allows Partful’s customers to access and participate in the aftermarket sales market, worth >$1Tn. Aftermarket revenues can last for decades and be more profitable than selling the original product, yet most OEMs do not have the sophisticated processes to access this market; two-thirds of aftermarket sales are lost to 3rd parties.

• Partful’s products also benefit customers by training their workforces, enabling efficiency savings in their manufacturing processes and in service centres.

partful.io

INVESTMENT DETAILS

Northern Gritstone equity held

Return to date:

£2.5 m n/a 10 %

KEY INVESTMENT HIGHLIGHTS

Marketing & scaling opportunity

• Very large opportunity to provide a broad range of enterprise and SME customers with the capability to provide aftermarket parts and work instructions to customers, dealerships and distributors — boosting stretched margins.

• SaaS model gives potential for hyper scaling.

IP & barriers to entry

• Significant copyright and know-how in software and architecture.

• Underpinned by 5 years of work with customers and the team’s first-hand domain experience of the sector’s problems.

Productisation & pipeline

• The company is generating recurring revenue through its existing product set, with further product releases set to unlock significant additional demand.

Management team

• CEO and founder Sam Burgess; ex special forces with vision, commitment and team ethos. Supported by experienced Chair Mark Robinson.

PURPOSE AND IMPACT

Responsible Consumption & Production

Enable easier repair of products, reducing waste, increasing accessibility to vital parts and components.

Industry, Innovation and Infrastructure

Increasing efficiency, reliability and up-time of products that depend on the industrial supply chain.

Decent Work & Economic Growth

Multiple of money invested

1.0 x Current valuation Internal rate of return

Key co-investors include: Par Equity and Blumberg.

Increase productivity by automating low-level tasks and improving training. Manchester HQ with additional new high-skilled jobs in the North of England planned.

KEY INFORMATION

• Founded in 2018 Silveray has developed a newly patented, direct X-ray detector material which improves X-ray sensitivity up to 1,000x compared to existing technologies, at a lower cost.

• Benefits for existing applications include higher-resolution images for an equivalent dose in industrial X-ray inspection, lower dose medical X-ray and larger possibilities for automated X-ray inspection.

• Due to the sensitivity of the conversion material (a semiconductor ink doped with nanoparticles) Silveray also facilitates new applications such as curved X-ray detectors, as only a thin product layer is necessary.

• Silveray relocated to Stockport to access X-ray specialists and resources, becoming a ‘spin-in’ to the wider University of Manchester deep-tech ecosystem.

silveray.co.uk

INVESTMENT DETAILS

19 %

Northern Gritstone equity held

Return to date:

1.0 x

Multiple of money invested

KEY INVESTMENT HIGHLIGHTS

Marketing & scaling opportunity

• Silveray’s solution has multiple end market applications including industrial, security, medical and veterinary — a TAM of $6.3bn.

IP & barriers to entry

• The core of Silveray’s IP lies in the formulation and application of its novel material, protected by multiple patent families.

Productisation & pipeline

• Prototypes of the Digital X-ray Film product have been positively received and Letters of Intent have been secured from large multi-nationals.

Management team

• Silveray is led by CEO Dan Cathie who has built and exited businesses in the space previously.

• CTO Stephen Whitelegg has significant experience including going through 2x IPOs.

• CPO Norman Stapelberg has built and delivered products in the X-ray industry.

• Perry Duffill (Chair) — extensive experience as a senior executive in multinational electronics manufacturers.

PURPOSE AND IMPACT

Innovation & Infrastructure

Current valuation

£2.4 m 6 %

Internal rate of return

Key co-investors include: UKI2S, R42 Group, Angel CoFund, UK Future Tech Invest.

The technology changes the value proposition of digital X-ray detection, disrupting the way industrial and medical industries utilise X-ray technologies.

Job Creation

A high number of new skilled jobs based in the North of England to be generated through this investment.

Reduced Inequalities

Decrease in cost supports wider use of X-ray technology, particularly in lower-income regions and markets.

| Imperagen

| Phlux

NG Innovation Services

THE CAPITAL+++ OF NORTHERN GRITSTONE

Northern Gritstone invests in world-class science and technology. How we support our portfolio companies to become world-leading is just as important.

Deploying our Capital+++ platform, we back our ambitious founders by enhancing capability and bringing in the talent and the infrastructure that can help grow a world-class scalable business.

NG Innovation Services is the ‘early-stage toolkit’ for founders that ‘leans in’ very early to create highperforming teams that transform a science- or technologyled business into a customer-led business with solid operational foundations. The support offered by the different functions of NG Innovation Services form a jigsaw, each part of which plays a critical role in building success.

NG Co-Investment

Builds high-calibre and complementary syndicates connecting founders with domestic and international investors from pre-Seed and Seed onwards.

NG Studios

A venture building program delivered with exceptional partners. In 2024 NG Studios ran two technology cohort programs with Deeptech Labs, supporting eleven earlystage companies. The first cohort raised over £15 million of Seed funding. KQ Labs will deliver our life sciences program with the first cohort launching in June 2025.

NG Growth

Offers hands-on support to enhance commercial capability, accelerating the essential transition from businesses which are technology and product-led to become customer-centric and revenue-generating faster.

Business Services Provides easy access to fundamental business ‘building blocks’ through best-in-breed, cost-effective, provider panels in HR, Finance, Insurance, IT and Branding.

NG Talent

Builds first-rate leadership teams, mentors leaders and connects them with expertise — industry entrepreneurs who have successfully ‘been there and done it’.

The Northern Arc of Founding and Partner Universities

Together and individually, the four Northern Arc universities have an impressive research footprint, history, and funding record. Their research quality is ranked equivalent to Oxford and Cambridge universities.* On a combined basis:

#1 #1 1 in 10 70 + 62,000

UK spinout volume UK research income ranking of every UK university patent academic institutes talent pool

They produce the highest annual volume of spinouts with Higher Education ownership in the UK2.

They have more research income than any Higher Education institute in the UK1

They produce 1 in 10 of every patent filed by a Higher Education institute in the UK2

Leading research institutes at the Founding and Partner Universities include:

They comprise over 70 leading academic institutes. A talent pool of over 16,000 research & academic staff 2 and almost 46,000 postgraduate students 2 .

This is summarised in the table below:

FOUNDING UNIVERSITIES PARTNER

*Average of 92% of research rated as ‘world leading/internationally excellent’ by the Research Excellence Framework, which compares against 91% for Oxford University and 93% for Cambridge University.

Sources: 1 — Universities 2 — HESA 3 — Research Excellence Framework. All data from 2023/24 except 3 which relates to 2021 and is the latest data available.

| University of Manchester

Our team — ‘Gritstoners’ turning the wheel

The Northern Gritstone team of ‘Gritstoners’ turn the wheel of Profit with Purpose by supporting ambitious companies in the North of England and by being active members of the North’s innovation hub.

We care deeply about regional growth through the creation of world-class companies. We know that building these businesses is hard work for our portfolio company founders, which is why we bring our support and empathy.

Our combined ‘Gritstoner’ skills are how we best support amazing founders and their teams. In the past year, our team has grown in our investment management business and in NG Innovation Services (the Capital+++).

Some of the Gritstoners turning the wheel of profit with purpose are shown opposite.

Jess McCreadie INVESTMENT DIRECTOR

Jess is an Investment Director specialising in Health Tech. She joined Northern Gritstone from Octopus Ventures where she worked as Principal specialising in Health Tech and B2B SaaS. Prior to Octopus, she was Investment Director at L&G, investing in Health Tech, Clean Tech and Infrastructure scale Clean Energy. Jess has a first-class honours degree in International Business from the University of Strathclyde. She manages the relationship with the University of Manchester for Northern Gritstone.

James Gibbons INVESTMENT MANAGER

James is an Investment Manager specialising in Life Sciences, including Biotech and Therapeutics. James leads the NG Studios Therapeutics accelerator program working with our delivery partner KQ Labs. He previously worked in commercialisation at the University of Leeds leading a team responsible for IP licensing. James has a Masters degree in Pharmacology from the University of Bristol.

Joanne Hosker HEAD OF NG INNOVATION SERVICES

Joanne is our Head of NG Innovation Services (‘NGIS’) and brings over 10 years' experience in talent selection and connecting C-Suite individuals with entrepreneurs and industry specialists, one of the bedrocks of the NGIS function. Joanne joined from BGF’s Talent Network Team where she supported the creation of effective boards introducing BGF portfolio businesses to a network of non-executive board directors and chairs.

Andy Naylor INVESTMENT DIRECTOR

Andy is an Investment Director with more than 20 years’ experience growing technology businesses. He was previously CEO of Nottingham Technology Ventures, a company that manages the University of Nottingham’s spinout portfolio and associated investment funds. Andy has been an investor, advisor, CEO and Non-Executive Director of technology companies. He holds a first-class honours degree and PhD in Physics from the University of Nottingham. Andy manages the relationship with the University of Leeds for Northern Gritstone.

Khadija Ashfaq INVESTMENT MANAGER

Khadija is an Investment Manager specialising in physical technology including Cybersecurity, Semiconductors and novel AI. Prior to joining Northern Gritstone, Khadija worked in venture capital for Northstar Ventures where she covered AI. She holds a BSc in Economics from the University of York and the CFA Investment Management Certificate.

Alan Pong PORTFOLIO ANALYTICS MANAGER

Following his graduation from the University of Edinburgh with a MA(Hons) in Accounting and Finance, Alan trained as a chartered accountant through ICAS in the audit and data assurance practices of PwC, specialising in asset and wealth management businesses. Alan also has experience in corporate accounting with Amazon UK prior to joining Northern Gritstone.

Risk management

Effective management of risk is necessary for Northern Gritstone to achieve its strategic objectives and is part of good management and effective governance.

The Group has a holistic approach to risk management embedded into its structures and processes through governance and risk appetite frameworks, and an underlying policy and control environment that integrates risk management into planning and decision-making.

Governance

The Group operates a systematic process of risk identification which is both bottomup and top-down, as well as aligned to its strategic aims. The approach is deliberately multi-faceted, to maximise the chances of successfully identifying risks and to ensure so far as possible that risks feature at the front of management thinking at all levels within the Group.

Overall responsibility for risk management rests with the Board, but Northern Gritstone recognises that it is important for all stakeholders across the Group to engage actively in risk management in order to ensure

that a positive risk management culture is developed and maintained.

Northern Gritstone’s Risk Management Methodology and Framework and its implementation is led by the Chief Financial Officer, with oversight from the Investment Committee, Audit and Risk Committee and Board.

The Investment Committee oversees risks associated with the investment strategy and that the investee portfolio is managed appropriately.

The Audit and Risk Committee oversees and reviews the annual risk management cycle. It reviews the Group’s risk appetite, reviews the principal risks affecting the business, and on-going mitigating actions. The Audit and Risk Committee also liaises with the external auditor regarding their assessment of the risks facing the business. The Audit and Risk Committee reports its findings to the Board.

Risk Management Methodology and Framework

Northern Gritstone operates an on-going risk management cycle in accordance with its Risk Management Methodology and Framework. This includes: identifying and evaluating the material risks affecting the business; reviewing the Group’s risk appetite; gathering input from the Group’s auditors; determining mitigating actions then monitoring their implementation.

Risk appetite

Northern Gritstone’s risk appetite is reviewed annually as part of the Group’s governance cycle, with oversight and input from both the Audit and Risk Committee and the Board.

Northern Gritstone has a high appetite for investment risk, which is inherent to investing at an early stage in innovative technology and life-science businesses. It intends to mitigate this risk by ensuring that the portfolio is diverse and that exposure is spread across

a large number of investments. This risk is further mitigated by active engagement with investee Boards, investee access to Northern Gritstone support and a focus on future funding options.

Northern Gritstone has a low appetite for risks relating to its: reputation; compliance; legal and regulatory; ethics; and financial integrity. The Group operates governance and control systems to ensure that risks across these areas are appropriately managed.

Principal risks

The Group’s Risk Register is formally reviewed and updated annually by the Audit and Risk Committee and approved by the Board. Highlighted overleaf are risks that are deemed key to the effective delivery of Northern Gritstone’s strategy, and the Group’s responses to them.

| University of Sheffield

INVESTMENT STRATEGY RISKS

RISK MITIGATION

Investment performance

Early-stage companies typically face a range of risks. A significant number of investee companies could perform poorly, leading to material losses for the Group.

Investee forward funding

The inability of Northern Gritstone’s investee companies to access sufficient capital at the right time could lead otherwise successful companies to fail.

Key person

The Group has a high level of dependence upon the Chief Executive Officer and Chief Investment Officer, particularly at this early stage of the Group’s development.

Investment pipeline

Insufficient volume or quality of spinout companies emerging from the Founding and Partner Universities may limit Northern Gritstone’s long-term growth prospects.

• Northern Gritstone’s employees have significant experience in sourcing, developing, and growing early-stage companies to significant value.

• Support is offered to all investee companies and members of Northern Gritstone’s investment team engage with investee company Boards to help identify and remedy critical issues promptly.

• Capital is deployed gradually across a large range of companies, at different stages of growth and across different sectors.

• Northern Gritstone seeks to employ a capital efficient process deploying low levels of initial capital to enable identification and mitigation of potential failures at the earliest possible stage.

• Northern Gritstone’s investee portfolio is young and will not have a significant cash need in the short-term. The Group regularly forecasts the cash requirements of investee companies along with identifying additional potential funding sources for future fundraising rounds.

• A strategy of working with co-investors is being pursued to reduce forward funding risk.

• Short-term succession plans have been developed for the roles of Chief Executive Officer and Chief Investment Officer.

• The Group offers a balanced incentive package which is designed to reward loyalty and retain the Chief Executive Officer and Chief Investment Officer.

• The strong reputation and long history of the Founding and Partner Universities supports a healthy research funding environment.

• Current government policies are supportive of innovation and the Levelling-Up agenda should drive innovation funding to the region in which Northern Gritstone operates.

• The Group engages with government and policy makers to support the funding environment for universities and early-stage innovation.

• Northern Gritstone has developed a good working relationship across the Founding and Partner Universities with departments from which spinouts are likely to emerge, in addition to running a range of accelerator programmes.

OTHER PRINCIPAL RISKS

RISK MITIGATION

Personnel risk

Failure to attract or retain suitable staff (who are largely highly skilled and specialist) would have a significant impact on the ability to execute Northern Gritstone’s strategy.

Culture

The Group is at an early stage of development and the culture adopted will have a significant impact on future performance.

Cyber & IT security

The Group may be subjected to phishing and ransomware attacks, data leakage and hacking.

Reputational damage

The Group has committed to be an example for other businesses to follow. Failure to do so could cause significant reputational damage.

• The Group carries out regular market comparisons for staff and executive remuneration and seeks to offer a balanced incentive package comprising a mix of salary, benefits, short-term and longterm incentives which are designed to reward loyalty and attract and retain key talent.

• The Group operates a rigorous hiring process and encourages employee development and inclusion through training and carries out annual objective setting and appraisals.

• The Group retains specialist recruitment firms to help fill open roles.

• The Group aims to create an open and inclusive culture which embraces challenge and value-add feedback.

• Diversity of thought and experience is actively encouraged and the Group has made available publicly its commitment to Equality, Diversity and Inclusion.

• The Group places strong emphasis on developing the right culture and operates a zero-tolerance approach to inappropriate behaviours.

• Northern Gritstone has in place a cyber & IT security policy and reviews its data and cyber-security processes with its external outsourced IT provider.

• The Group has a regular IT management reporting framework in place.

• There is an ongoing focus on IT security and staff training, including simulated cyber attacks and maintenance of a business continuity plan.

• The Group’s governance is of a high standard and the strong ethical values the Group embraces guide how we do business in every aspect.

OTHER PRINCIPAL RISKS

Continued...

RISK

Compliance

The Group must comply with a broad range of regulatory and legal requirements. Failure to adhere to these rules could result in a fine, legal proceedings against Directors or the failure of the Group to continue to operate.

Relationship with the Founding Universities

Northern Gritstone is reliant on the Founding Universities for a large volume of its potential investments. Were the Framework Agreement to be terminated it would have a significant impact on the strategy of the Group.

Operations

Failure of key third-party suppliers or service level agreement failure affecting Northern Gritstone’s ability to maintain operational viability. In addition, failure in internal controls and procedures could have the same impact.

Climate

One-off climate events may disrupt operations.

MITIGATION

• The Group maintains a continual review of its compliance in key areas, including commissioning third-party reviews where required. No material issues have been identified to date.

• The Group maintains D&O and professional indemnity insurance policies.

• The Founding Universities are shareholders in Northern Gritstone, which creates a mutually beneficial partnership. In addition, each Founding University appoints a Non-Executive Director to the Group’s Board and is an active member of at least one subcommittee of the Board.

• Northern Gritstone is collaborating well with the Founding Universities and the relationships with the Technology Transfer Offices are strong. Should an issue arise, the Framework Agreement contains mechanisms for managing these.

• The Group has the ability to invest beyond spinouts from the Founding Universities.

• The Group is in regular contact with third-party suppliers and monitors for any impending issues.

• All third-party suppliers provide functions which could be switched to another supplier if required.

• The Group has established internal controls and procedures appropriate for its stage of development.

• The Group’s employees have the ability to work in multiple offices or from home if there is a climate event in their location.

• A prolonged climate event across the region is possible, but is likely to be temporary in nature.

| University of Sheffield

03 Purpose & Impact

Purpose & Impact

During the period reported Northern Gritstone has continued to develop its Purpose & Impact (‘P&I’) strategy. The results of the annual P&I focused survey of our investee companies are incorporated into this report.

Entities backed

During the period Northern Gritstone invested in an additional 8 companies. In total, the Group has now backed 32 science and innovation-based businesses in the North of England, all enjoying strong intellectual property underpinned by world-class science and an ability if successful to become world-leading businesses.

Capital leveraged

Since inception, an additional £301m of co-investment has been invested or committed by a series of local, European and other international investors into the North of England alongside the Group’s £65m of committed and invested capital. This represents c.4x

the value that Northern Gritstone has invested. Total funding to date made by Northern Gritstone and co-investors now stands at £366m.

Job creation

The 32 investments Northern Gritstone has made to date funded 245 additional jobs, with significantly more to follow as the monies invested are fully deployed by the investee companies. At 31 March 2025 Northern Gritstone’s investee companies employed 744 people in total. 100% of investee companies pay all employees and contractors at least the Real Living Wage. This is consistent with the high-skill, high-wage jobs which Northern Gritstone intends to generate.

PRIMARY PORTFOLIO UN SUSTAINABLE DEVELOPMENT GOALS ALIGNMENT

Note: Numbers refer to the UN classification of the Sustainable Development Goals.

EXAMPLES OF INVESTEE COMPANIES WITH HIGH IMPACT TOWARDS SPECIFIC UN SDGS INCLUDE:

Climate Action

Currently data centres emit c.1 billion tonnes of CO2e emissions each year globally (3% of total global CO2e emissions). Iceotope’s precision liquid cooling products can reduce energy usage in data centres by up to 40% and water usage by up to 96%. Their technology has already helped their customers avoid c.1,450 tonnes of CO2e emissions.

Good Health and Wellbeing

Crucible significantly improve the quality and duration of lives in those that would otherwise die from conditions for which no efficacious treatments exist. The company is initially focused on developing treatments for Amyotrophic Lateral Sclerosis and Frontotemporal Dementia, of which there are a combined 2,500 cases diagnosed annually but with no effective treatments available.

Industry, Innovation and Infrastructure

BOW is developing a toolkit to democratise robotics software development. Its cross-platform, cross-robot solution opens robotics programming to all software developers by making it possible to code in any programming language and to deploy that code on any robot, making the development of robotic applications quicker, easier and more cost effective. By reducing the complexity and cost of robotic development, BOW supports increased innovation and the development of scalable infrastructures within the robotics sector with the potential for positive impact on a global scale.

40

THE GROUP’S CARBON EMISSIONS 1 AND INTENSITY RATIOS DURING THE PERIOD WERE:

The total level of carbon emissions increased in the period driven by scope 3 emissions as a result of an increase in both the average number of employees, which rose to 27 during the period ended 31 March 2025 (2024:19), and the Group’s average invested capital, which rose to £48.9m during the period ended 31 March 2025 (2024: £26.2m).

The Group’s two key measures of annualised tCO2e per average invested capital and per average employee both increased in the period due to:

(a) a proportional shift to investment in later stage companies with manufacturing capabilities and thereby generally higher emissions-intensity; and (b) greater international travel in the period, necessitating the use of air travel.

The Group aims to minimise its carbon footprint in the first instance and then to offset any excess carbon emissions. The Group fully offset carbon emissions from its own operations for the period ended 31 March 2025 and for the period ended 31 March 2024. The carbon offset for both periods was performed through Carbon Footprint Limited, which runs a unique tree buddying scheme. As part of this scheme, Northern Gritstone funded the planting of trees in schools in the North of England and also supported projects reducing deforestation in the Amazon and Africa. These projects have been validated and verified against the Verified Carbon Standard.

During the period the Group re-affirmed its commitment to the Net Zero Asset Manager’s initiative. In the prior period the Group defined interim targets to achieve net zero across the Group and all of our investments by 2050 or sooner. The interim targets set, under the Paris Aligned Asset Owners Net Zero Investment Framework, are:

• 50% of invested capital actively engaged in carbon reduction conversations at Board level by 2030, increasing to 100% by 2040. At 31 March 2025, 22% of invested capital is actively engaged in carbon reduction conversations at Board level (2024: 14%).

• 30% of invested capital aligning or aligned with a net zero goal by 2030, increasing to 80% by 2040 and 100% by 2050. At 31 March 2025, 15% of invested capital is aligning or aligned with a net zero goal (2024: 12%).

• 100% of invested capital to have achieved net zero by 2050, with interim absolute carbon emission reduction targets to be set once Northern Gritstone’s portfolio has been fully established (expected by 2027). At 31 March 2025, no invested capital has achieved net zero (2024: nil).

emissions of the companies in which Northern Gritstone has invested, pro-rated to reflect Northern Gritstone’s relative share of ownership.

Equality, diversity and inclusion

THE GENDER AND DIVERSITY MEASURES REPORTED BY THE GROUP ARE:

In the long-term, the Group aims to reflect the communities in which it operates across all levels of the business and will continue to focus on developing a diverse and inclusive team as it builds out its operations. We are committed to removing barriers that may hold people back because we know that when people come together with different views, approaches and insights it can lead to a richer, more creative and innovative environment for creating the world-leading businesses of tomorrow. The Group ultimately aims, across all levels of the business, for a 50:50 gender balance and for at least 14% of people to come from an ethnic minority background. These percentages are consistent with the demographics of Leeds, Greater Manchester, Merseyside and Sheffield.

Northern Gritstone’s focus on Purpose & Impact and doing business in the right way underpins the business’ culture. Good businesses are diverse businesses by thought, experience, background and outlook as well as by gender, race, sexuality and other characteristics. The Group recognises that true diversity is 3D and incorporates a broad range of measures including socio-economic background, neurodiversity and education. Creating a diverse and inclusive working environment is central to our culture at Northern Gritstone and the Group has adopted and published on the Group’s website a statement on its commitment to equality, diversity and inclusion.

The portfolio P&I survey provides an insight into the backgrounds of those leading and employed by our investee companies. 18% of all people employed by Northern Gritstone portfolio companies come from an ethnic minority background, which is above the average of 14% of the populations of Leeds, Greater Manchester, Merseyside and Sheffield. However, only 24% of people employed by portfolio companies identified as female. This level is consistent with UKwide surveys of people employed in STEM (‘Science, Technology, Engineering and Maths’) industries, but is an area on which the Group will continue to engage with investee companies as they build out their operations. More positively, over 70% of investees have a mixed-gender Board, which compares against 28% across the UK venture-capital market 2 .

The Group is a signatory to the Investing in Women Code, with a commitment to improve the potential for female entrepreneurs to access successfully the tools, resources, investment and finance they need to build and grow their businesses. This reflects the Group’s commitment to gender equality across both Northern Gritstone itself and its existing and future investee companies. During the period reported, the Group has taken the following specific actions to promote female entrepreneurship:

• Established an investment committee that is 50:50 male / female;

• Established an investment team which is 50:50

male / female;

• Attended and presented at events focused on promoting female entrepreneurs;

• Held an Equality, Diversity and Inclusion Day, which celebrated the diversity of our workforce;

• Engaged positively on diversity matters with investee companies (including through talent support services provided by NG Innovation Services);

• Backed female led companies (e.g. Pencil Biosciences, Floreon and adsilico) and companies with leading female academic founders (e.g. Auxetec, MicroLub and Crucible); and

• Analysed diversity and inclusion data for the Group and the portfolio at Executive and Board level.

NO GOVERNANCE OR LEGAL ISSUES AROSE DURING THE PERIOD. THE BOARD AND GOVERNANCE COMMITTEES MET PER THE TABLE BELOW:

Jim O’Neill

Duncan Johnson

James Hadley

Andrew Graham

Alex Macpherson

Jane Madeley

Luke Georghiou

Sue Hartley

Niranjan Sirdeshpande

Marion Bernard

Keith Breslauer

Tim Lewis

The Group focuses on working closely with its investee companies and their Boards, both through direct engagement by Northern Gritstone’s investment team and through sharing best practice. As part of the latter, we were pleased to hold our first P&I focused webinar with investees in the period. NG Innovation services now also offers a

toolkit which early-stage investees can use to set their businesses on course for success. Through this involvement, the Group takes an active role in developing, assisting, supporting and monitoring the strategic development of our investee companies. It is Northern Gritstone’s belief that if investee companies adopt a strong approach to governance,

which is appropriate for their stage of development, they are more likely to progress well in other areas of P&I and as a business more generally. Given this focus it was pleasing that, of the topics covered in

Wider purpose and impact

The Group is focused on ensuring that it works closely with other businesses in the North of England along with supporting the local communities in which we operate. This is alongside being a strong advocate for the Northern innovation economy and supporting this with commercial initiatives wherever possible.

A vibrant Angel community is vital to support early-stage investment. In order to support the development of Angel networking across the region, the Group continued to engage actively with Manchester Angels, of which Northern Gritstone is a founding investment partner.

We were delighted to collaborate with Cambridge Innovation Capital and Oxford Science Enterprises to host an event at the Mansion House promoting the benefits of investing in UK university spinouts attended by over 300 institutional investors. Northern Gritstone also supported the Manchester based Royce Tata Materials MedTech Catalyst, the Sheffield-based National Centre for Children’s Health Technology and sponsored the Northern Triangle Therapeutics Accelerator Programme, which supports the commercialisation of therapeutics discoveries emerging from the Founding Universities.

The Group actively seeks to partner with suppliers which have a presence in the North of England. At 31 March 2025 over 50% of the Group’s suppliers were either headquartered in the North of England or service the Group from a team based in the North of England.

During the period the Group continued to develop is outreach programme, connecting with students attending local schools as well as students of the Founding Universities. Northern Gritstone has now connected with over 100 students in total through

the portfolio P&I survey undertaken in the period, investee companies scored highest in those related to governance.

its outreach programme. The Group engaged with Young Enterprise, with members of Northern Gritstone’s investment team volunteering to sit on panels judging student enterprises. Northern Gritstone employees also provided business mentoring to teachers who received grants from educational charity SHINE and volunteered to assist South Yorkshire Community Foundation with its grant allocation process, with the aim of maximising local impact.

| Members of the Northern Gritstone team volunteered in the Peak District

International standards and guidance

Northern Gritstone is a signatory to the United Nations Principles for Responsible Investment.

The Group utilises the Sustainability Accounting Standards Board (‘SASB’) materiality guidelines when assessing the Purpose & Impact factors most likely to impact materially the financial condition or operating performance of both the Group and its investee companies.

As part of the investment appraisal process for potential investee companies, Northern Gritstone maps each company’s impact against the UN’s Sustainable Development Goals and utilises the Impact Management Project framework for

measuring and assessing impacts. The Group tracks and reports on progress against the impacts identified.

The Group has in place an investment exclusion list, detailing businesses or activities in which it does not and will not invest. This covers a broad range of activities which are harmful to people or the planet. A full copy of Northern Gritstone’s investment exclusion list is available to download from the Group’s website.

Signatory of:

| University of Leeds

| University of Sheffield

| University of Manchester

Task Force on Climate-related Financial Disclosures

We recognise the importance of combating climate change and are committed to assessing and integrating the impact of climate change into our business strategy, operations and risk management processes. Northern Gritstone is not required to report against the recommendations of the Task Force on Climate-related Financial Disclosures (‘TCFD’), but has chosen to do so on a voluntary basis as part of its commitment to the Net Zero Asset Manager’s initiative.

We are in the early stages of aligning with the recommendations of the TCFD and our focus in the period reported was on assessing, qualitatively, the associated impact and management of climaterelated risks and opportunities on Northern Gritstone and our portfolio. Our approach has been guided by the ‘TCFD Implementation Considerations for Private Equity’ report published by TCFD, which recommends an approach to implementing TCFD recommendations that is appropriate to an

organisation’s size, the geographic coverage of its investments and its exposure to high-risk climate sectors. Northern Gritstone is a small business by asset management standards, invests in businesses based in the North of England and has no exposure to high-risk climate sectors. Consequently, our approach to reporting under TCFD has been informed by these considerations. Going forward, we will continue to evolve and enhance our climate governance and reporting as appropriate.

GOVERNANCE

TCFD Recommendations

Disclose the organisation’s governance around climate-related risks and opportunities.

a. Describe the Board’s oversight of climaterelated risks and opportunities.

b. Describe management’s role in assessing and managing climaterelated risks and opportunities.

The Board actively identifies and evaluates the risks inherent in the business, formally reviews these on at least an annual basis, and ensures that appropriate controls and procedures are in place to monitor and, where possible, mitigate these risks (see Risk Management on pages 32 to 36 of this Annual Report for further information).

This process includes climate-related risks and opportunities, which are discussed and approved by the Board, having been considered by the Purpose & Impact committee. Climate change targets have been set by the Board, with metrics updated and tracked at least annually (see Metrics and Targets within this TCFD section for further information).

The Chief Financial Officer is responsible for leading on Purpose & Impact matters throughout the Group and is a member of the Purpose & Impact committee, Executive committee and the Board (see Governance on pages 52 to 60 of this Annual Report for further information on the Governance structure of the Group).

The investment team engage with portfolio companies on climate risks and opportunities. Processes are in place so that management and the Board are appropriately informed of climate-related issues and that they are escalated where applicable (see Risk Management within this TCFD section for further information).

Purpose & Impact goals form part of the annual performance objectives of all employees of the Group and the Board are informed by climate-related issues when reviewing and guiding the Group’s strategy.

STRATEGY

TCFD Recommendations

Disclose the actual and potential impacts of climate-related risks and opportunities on the organisation’s businesses, strategy, and financial planning where such information is material.

a. Describe the climate-related risks and opportunities the organisation has identified over the short, medium, and long term.

b. Describe the impact of climate-related risks and opportunities on the organisation’s business, strategy and financial planning.

c. Describe the resilience of the organisation’s strategy, taking into consideration different climate-related scenarios, including a 2°C or lower scenario.

The information on the following pages highlight the actual and potential climate-related risks and opportunities that Northern Gritstone is exposed to and describe, qualitatively, the impact these may have on the organisation, and how we aim to mitigate climate risks and harness climate opportunities. Our financial planning informs our business and strategy, and is reactive to the environment in an iterative manner. We will continue to assess these climate-related risks and opportunities as part of our risk management process and aim to advance our analysis in the coming years.

We have considered Northern Gritstone Limited and its subsidiaries, as well as Northern Gritstone’s portfolio in aggregate. We recognise that the associated impact resulting from each risk and opportunity will vary across different portfolio companies. Moreover, while the identified risks and opportunities are those that we deem to be most material across Northern Gritstone and the portfolio as a whole, there are risks and opportunities not included below which may be more relevant for specific portfolio companies.

We have qualitatively assessed these risks over the short-term (0-5 years), medium-term (6-15 years), and long-term (16-30 years), considering transition risks, physical risks (both acute and chronic) and opportunities. The analysis was performed

using two scenarios developed by the Network for Greening the Financial System. These are:

Net Zero 2050 — Assumes that ambitious climate policies are introduced immediately. CO₂ removal is used to accelerate decarbonisation but kept to the minimum possible and broadly in line with sustainable levels of bioenergy production. Net CO₂ emissions reach zero around 2050, giving at least a 50% chance of limiting global warming to below 1.5°C by the end of the century. Physical risks are relatively low but transition risks are high.

Current Policies — Assumes that only currently implemented policies are preserved, leading to high physical risks. Emissions grow until 2080 leading

to about 3°C of warming and severe physical risks. This includes irreversible changes, such as higher sea levels, and results in a hot house world.

Based on this initial assessment, we believe Northern Gritstone’s strategy is resilient to the identified climate risks, as we continue to evolve and put resources towards climate risk assessment, mitigation, and reporting. Given Northern Gritstone invests in multiple companies providing climate solutions, at a high level the opportunities out-weigh the risks in the Net Zero 2050 scenario, whilst the opposite is true in the Current Policies scenario.

Increased energy and raw material costs

Enhanced reporting obligations

Increased pricing of energy and raw materials, including increased pricing of greenhouse gas emissions, is primarily a risk for later-stage energy-intensive companies. Given most of Northern Gritstone’s portfolio are early-stage, we believe this risk will have a low level of impact in the shortterm. However, this risk may increase in the medium- to long-term as companies scale. We aim to reduce exposure to this risk by engaging with new investments and portfolio companies on energy intensity, emissions measurement and emissions reduction.

Enhanced reporting obligations will require both Northern Gritstone and our portfolio companies to commit time and resources to comply with emissions- and climate-related reporting requirements. This is more of a risk to Northern Gritstone itself in the short-term, given the early-stage nature of our portfolio, though we expect this to have a higher level of impact on portfolio companies, given the time and resource constraints start-ups experience in times of expansion. This year, the Purpose & Impact committee began an annual review of the emissions- and climaterelated reporting requirements impacting Northern Gritstone and its portfolio. We also collect Purpose & Impact, including climate, data from our portfolio companies, and aim to highlight Purpose & Impact and climate reporting requirements to our new investments.

Supply chain instability

Risk of supply chain disruption which limits the availability of component parts required for manufacturing for certain companies. We support portfolio companies to review supplier sourcing strategies; encourage companies to develop contingency plans for when one supplier is affected; and encourage companies to avoid overconcentration of risk with key suppliers.

Political instability

Extreme weather events

Risk of political instability resulting from widespread climate crises globally. The impact could lead to social breakdown and increased conflict, with the effects being difficult to predict and potentially fast-moving. We support portfolio companies to develop business models and strategies that are flexible; encourage companies to avoid over-concentration of risk with key customers; and review the political landscape when considering future suppliers, customers and investors.

Business interruption because of extreme weather events taking electricity offline, flooding lab space and disrupting supply chains. As the physical effects of climate change worsen over time, we expect the level of impact to also increase. We aim to identify whether new investments are exposed to physical risks resulting from climate change, including exposure to supply chain risks, and engage with the company to develop back-up and resilience plans.

Climate and Cleantech investment opportunities

Shift in consumer preferences

Given our access to world-leading science and talent we believe we have a significant opportunity to invest in companies accelerating decarbonisation (e.g. CCUI). We see the potential impact of this opportunity as particularly high in the short-term, though believe it will continue to be an opportunity over time as these companies scale, and as we uncover new climate science and technology in the Founding and Partner Universities. Inherently, our business model enables us to harness this opportunity, both to uncover these opportunities — through early access to leading science, engagement with academics, and landscaping to identify areas of market need — and to scale the impact these companies can have, including by bringing in specialist talent and investors.

We believe that the shift in consumer preferences is an opportunity for technologies which mirror existing processes but with significantly less climate impact (e.g. Iceotope). Such companies are, and will continue to, benefit from increased demand from consumers requiring more efficient, low-carbon processes. To ensure our companies continue to benefit from the increased demand for climate solutions, where possible, our investment team may support the company to identify business development opportunities, and introduce the company to potential corporate partners. Moreover, the team may engage with these partners to understand areas of market need.

Technological innovation

Talent and capital expansion

There will be a growing need for technological innovation to support the energy transition (e.g. storing various forms of renewable energy) and to assist communities adapting to climate change (e.g. technologies that help in the conservation, cleaning and filtering of water in regions that become waterscarce). We aim to work with the Founding and Partner Universities to help identify early-stage technologies which can solve such issues and be developed into strong commercial propositions.

By investing in companies developing climate-tech, and by integrating Purpose & Impact considerations through the investment process, both Northern Gritstone and our portfolio companies have the opportunity to access new pools of talent and capital. We see this opportunity as especially high in the short-term, as sustainable finance and climate-related regulation is rolled out across the UK and EU. We aim to harness this opportunity by continuing to expand the scope of our Purpose & Impact, including climate initiatives and reporting, and support our portfolio companies to do the same. Moreover, through NG Innovation Services, we support our companies in sourcing specialist talent.

RISK MANAGEMENT

TCFD Recommendations

Disclose how the organisation identifies, assesses, and manages climate-related risks.

a. Describe the organisation’s processes for identifying and assessing climate-related risks.

b. Describe the organisation’s processes for managing climate-related risks.

c. Describe how processes for identifying, assessing, and managing climaterelated risks are integrated into the organisation’s overall risk management.

In relation to new investments, the investment team assess the Purpose & Impact factors most likely to impact materially the financial condition or operating performance of a potential investment, including

climate-related risks and opportunities. Material risks are presented to the Investment Committee prior to approval and, if a company receives investment from Northern Gritstone, are considered as part of the semi-annual investment valuations exercise.

Where a climate-related risk relating to a new investment opportunity is considered materially significant to the strategy or reputation of the Group, the Investment Committee will seek Board approval prior to making an investment decision. The Group also has in place an investment exclusion list, detailing businesses or activities in which it does not and will not invest. This covers a broad range of activities which are harmful to people or the planet. Northern Gritstone’s investment exclusion list is contained within its Purpose & Impact policy, which is available to download from the Group’s website.

The climate risks and opportunities outlined on the previous pages were identified and assessed based on work performed by the investment team prior to investment, consolidated by the Chief Financial Officer and reviewed by the Purpose & Impact committee and the Board. Northern Gritstone also asks its portfolio companies to selfassess the climate-related risks and opportunities they face and integrates this analysis into its reporting, which also serves as a tool to engage portfolio companies on climate-related issues. This is an annual exercise which feeds into Northern Gritstone’s existing risk management process, with significant investment-related risks being raised to the Investment Committee as part of the investment performance review process and

METRICS AND TARGETS

TCFD Recommendations

Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where such information is material.

a. Disclose the metrics used by the organisation to assess climate-related risks and opportunities in line with its strategy and risk management process.

b. Disclose Scope 1, Scope 2, and, if appropriate, Scope 3 greenhouse gas (GHG) emissions and the related risks.

c. Describe the targets used by the organisation to manage climate-related risks and opportunities and performance against targets.

The climate-related metrics monitored are compliant with TCFD recommendations; namely absolute emissions, average emissions per employee and average emissions per invested capital. The emissions data reported includes scopes 1, 2 and 3 relating to the Group’s own operations and scopes 1 and 2 relating to the operations of Northern Gritstone’s portfolio companies (see Carbon Emissions on page 40 of this Annual Report for additional information).

escalated to the Board as appropriate. Climate risk is also considered as a strategic risk, with links to other business risks made in material circumstances (see Risk Management on pages 32 to 36 of this Annual Report for further information).

We are working to evolve our approach to measuring, monitoring, and supporting our portfolio companies as it relates to climate-related risks. As part of this effort, during the year we included additional Purpose & Impact clauses in transaction documents and provided climate-related training to the investment team so that they are well placed to identify early climate risks and opportunities.

The Group is a signatory to the Net Zero Asset Manager’s initiative and has committed to achieve net zero carbon emissions across the Group and all our investments by 2050 or sooner. For details of the interim targets set and performance against these to date see the Carbon Emissions section on page 40 of this Annual Report.

Governance structure

The Group recognises the importance of sound corporate governance and takes into consideration the main provisions of the UK Corporate Governance Code 2018 as published insofar as they are appropriate given the Group’s size and stage of development.

The Board of Northern Gritstone Limited (the ‘Board’) is responsible for formulating, reviewing, and approving the Group’s strategy, budget, and corporate actions. The Board meets regularly as required and not less than quarterly.

In October 2024 Northern Gritstone Investment Manager Limited (a wholly owned subsidiary of Northern Gritstone Limited) received authorisation from the FCA to operate as a small UK authorised Alternative Investment Fund Manager and assumed

responsibility for managing the investments of Northern Gritstone Limited. In the same month the employees of Northern Gritstone Limited transferred to either Northern Gritstone Investment Manager Limited or Northern Gritstone Innovation Services Limited (a wholly owned subsidiary of Northern Gritstone Limited).

The updated governance structure following this change is set out below:

Committees Remuneration

Duncan Johnson Chair Chair Chair Member

James Hadley Member Member Chair

Andrew Graham Chair Member

Alex Macpherson Member* Member*

Jane Madeley Chair

Luke Georghiou Member

Sue Hartley Member

Niranjan Sirdeshpande Member

Paddy Dowdall Member**

Marion Bernard Member Member Member

Joanne Hosker Member**

Keith Breslauer Member*

Darran Ward Member**

Fiona Marston Member*

Timothy Lewis Member*

* Independent Member ** Appointed after 31 March 2025

Remuneration Committee

Key responsibilities: determining, within the agreed terms of reference, the Group’s policy on the remuneration packages (including share schemes and other long-term incentive plans) of the Group’s Chairperson, Executive Directors and such other members of the executive management as it is designated to consider.

Audit & Risk Committee

Key responsibilities: ensuring that the financial performance of the Group is appropriately reported and reviewed; reviewing internal control and risk management systems, including reporting to the Board on the Group’s risk appetite and risk measurement; reviewing the Group’s cyber security and data protection arrangements; and advising on the appointment of external auditors.

Group Executive Committee

Responsible for the day-to-day running of the Group and the execution of its strategy.

Investment Committee

The Board has delegated authority for making all normal course investment, divestment and

follow-on investment decisions in companies on behalf of Northern Gritstone Limited to Northern Gritstone Investment Manager Limited, which performs this function through its Investment Committee. Investment decisions which are outside the normal course require Board approval.

Purpose & Impact Committee

Key Responsibilities: to design and provide oversight of the Group’s Purpose & Impact strategy, providing specialist input and review as required. The Committee is both an Executive and Governance Committee and reports at each Board meeting.

Valuation Committee

Key responsibility: to review the valuations of all investments managed by Northern Gritstone Investment Manager Limited. During the year ended 31 March 2025 the Committee performed this review on a halfyearly basis. From 1 April 2025, the Committee will perform this review on a quarterly basis.

Key policies

The Group has adopted policies and procedures designed to help and guide Directors and employees in the performance of their duties, their conduct and their business relationships. These are reviewed annually to ensure that the Group’s governance remains both appropriate and effective. Key policies adopted include:

• Board Governance Policy

• Capital Allocation Policy

• Purpose & Impact Policy

• Whistleblowing Policy

• Anti-bribery Policy

• Equal Opportunities Policy

• IT and Cyber Security Policy

• Conflicts of Interest Policy

• Valuation Policy

• Privacy Policy

• Data Protection Policy

• Commitment to Equality, Diversity & Inclusion

• Compliance Manual

Committee reports

Since 31 March 2024, the activities of the committees shown on the previous page have focused on:

Remuneration Committee

The Committee fulfilled its duties under its terms of reference, with the main areas covered being review and approval of the Group’s shortterm and long-term incentive plans (including assessing performance against the targets set for each), as well as review and approval of the remuneration packages of the Executive directors, Board Chair, and senior managers.

Audit & Risk Committee

The Committee had a busy year, including undertaking a review of the governance changes required as a result of transitioning to a group structure. In addition, the Committee fulfilled its duties under its terms of reference, with the main areas covered being review of the interim and full year accounts (including review of investment valuations in each), review of the Group’s IT and cyber security arrangements, review of the Group’s internal control environment and risk methodology and processes, and an assessment of the performance of the external auditor.

Group Executive Committee

The Committee met on a monthly basis with topics addressed covering the full range of areas required to support the day-to-day

running of the business, including an ongoing assessment of financial plans, recruitment, risk assessment, internal controls review, health & safety and equality, diversity & inclusion.

Investment Committee

The Committee met 20 times during the year, with the principal business being the assessment of potential investment opportunities and evaluating the performance of investee companies.

Purpose & Impact Committee

The Committee continued to provide valuable insight and review of the Group’s Purpose & Impact (‘P&I’) strategy. Particular areas of focus were reviewing the portfolio P&I survey responses, advising on the Group’s outreach program, reviewing the Group’s reporting to external bodies, reviewing an enhanced assessment of climate related risks and opportunities, and reaffirming the Group’s continued commitment to the Net Zero Asset Managers Initiative.

Valuation Committee

The Committee fulfilled its duties under its terms of reference, which principally focus on a detailed review of investment valuations at the interim and full year.

Board of Directors

Lord Jim O’Neill CHAIRPERSON

Lord O’Neill is a crossbench peer in the House of Lords. He is a member of the South Yorkshire Mayoral Economic Advisory Council and Chair of the NeoTest Advance Market Commitment working group.  He was previously, inter alia: Chair of the Northern Powerhouse Partnership; joint head of research at Goldman Sachs, its chief economist and Chair of its asset management division, Chair of the City Growth Commission, Chair of the Review on Antimicrobial Resistance, commercial secretary to the Treasury and Chair of Chatham House. He is a board member, and one of the founding trustees of the educational charity SHINE.

Duncan Johnson CHIEF EXECUTIVE OFFICER

From 2011-2021 Duncan was the Head of Caledonia Private Capital, the private capital arm of Caledonia Investments plc, a FTSE 250 listed investment trust. Prior to leading Caledonia Private Capital, Duncan was a founding partner at RJD Partners having started his investment career at Royal Bank Development Capital. He initially trained as a chartered accountant with the insolvency arm of PwC. Duncan is also a non-executive director of Sackville Capital Ltd, an institutional investment firm.

James

Hadley CHIEF FINANCIAL OFFICER

James is a Fellow of the Institute of Chartered Accountants in England & Wales and trained with KPMG. He has c.20 years’ experience in the financial services sector gained working for a variety of companies, including Santander and RSA. Most recently he served as Chief Financial & Operating Officer at Savannah, a tech focused VC fund manager.

Andrew Graham

INDEPENDENT NON-EXECUTIVE DIRECTOR

Andrew has over 30 years experience in senior management roles across financial services and technology businesses. Andrew was previously COO of Blippar, having developed the business from a start-up to a global business of over 300 people with offices in New York, Chicago, Los Angeles, and San Francisco. Andrew is currently chairperson and nonexecutive director of a number of fastgrowing businesses in the financial services, gaming, technology and healthcare sectors.

Alex Macpherson

INDEPENDENT NON-EXECUTIVE DIRECTOR

Alex is a venture capitalist with over 25 years experience of investing in technology businesses. He is a venture partner at Isomer Capital accessing European technology investments through limited partner investments in funds as well as direct company investments. He is also a member of the investment committee at DeepTech Labs, a deep tech accelerator based in Cambridge. Previously, Alex co-founded the venture capital business that became Octopus Ventures in 2007. He led the business as CEO until 2017 and subsequently as chairperson until 2019.

Sue Hartley

UNIVERSITY APPOINTED

NON-EXECUTIVE DIRECTOR

Sue joined the University of Sheffield in January 2020. She is the Vice President for Research and Innovation and leads on the University’s research activity, including research excellence, the University Research Centres, the Research Excellence Framework, research income and impact, and she oversees the University’s innovation, partnerships, and commercialisation activities.

Jane Madeley

UNIVERSITY APPOINTED NON-EXECUTIVE DIRECTOR

Jane is the CFO of the University of Leeds, having joined as Finance Director in 2009. Prior to joining the University, Jane worked for 15 years in senior finance roles within international retail and consumer goods businesses, including: ASDA Walmart; Campbell Soup Company; and PPR. Jane currently holds a range of non-executive roles which include: vice-chairperson of the CBI Council for Yorkshire and the Humber; nonExecutive Director of Global Health Education Group and board member and chair of the Audit Committee of NHS West Yorkshire Integrated Care Board.

Niranjan Sirdeshpande

NON-EXECUTIVE DIRECTOR

Niranjan is Global Head of M&G’s Catalyst team and sits on the Investment Committee. Previously he led the European team at Catalyst responsible for originating and executing early-stage equity and private debt transactions. Niranjan has led transactions in diverse sectors including biotech, fintech, clean energy and micro finance, and sits on the board of several of Catalyst’s portfolio companies. Prior to joining Catalyst, Niranjan served in a number of varied roles at M&G and Prudential, including Associate Director at PruCap and executive business manager to the CEO of Prudential plc.

Luke Georghiou

UNIVERSITY APPOINTED NON-EXECUTIVE DIRECTOR

Professor Luke Georghiou is Associate Vice-President at the University of Manchester and Professor of Science and Technology Policy and Management in the Alliance Manchester Business School. Luke is also currently a non-executive director of the Manchester University NHS Foundation Trust and Chair of the Board of Manchester University Press.

Paddy Dowdall

NON-EXECUTIVE DIRECTOR

Paddy is Assistant Executive Director at Greater Manchester Pension Fund with responsibility for property, local investments and infrastructure. Paddy has significant experience of investment in a wide range of assets including listed securities, infrastructure, private equity and property and has previously worked at Merseyside Pension Fund. Paddy is a member of the Chartered Institute of Public Finance and Accountancy.

Directors’ Report

The Directors present the Annual Report and audited financial statements for Northern Gritstone Limited (the ‘Company’) and its subsidiaries (together, the ‘Group’) for the year ended 31 March 2025.

The information provided in the previous sections is taken to constitute part of the Directors’ report.

RESULTS AND DIVIDENDS

The Group made an overall loss after taxation for the year ended 31 March 2025 of £10,373,000 (2024: £3,783,000 loss after taxation). The loss in the period was due to a combination of administrative costs and a reduction in the fair value of investments, which are described in detail on page 12. The Directors do not recommend the payment of a dividend (2024: nil).

DIRECTORS

The names of Directors who currently hold office or did so during the reported period are as follows:

• P Dowdall (appointed 1 April 2025)

• A Graham

• G Georghiou

• J Hadley

• S Hartley

• D Johnson

• A Macpherson

• J Madeley

• T O’Neill

• N Sirdeshpande

ACTIVITIES OF THE BOARD

Since 1 April 2024, the activities of the Board have focused on supporting the continued enhancement of the business. This has included reviewing and monitoring the implementation of the Group’s investment and corporate strategy (encompassing a detailed assessment of progress-to-date and future plans), monitoring the operating partnerships with the Founding Universities, approving a new partnership with the University of Liverpool,

reviewing the governance changes required as a result of transitioning to a group structure, reviewing the strategic risk register and risk appetite statement, reviewing key policies and the reports of sub-committees, reviewing the Group’s Purpose & Impact targets and progress against these, reviewing Executive succession plans, reviewing the Group’s Net Zero goals as well as climate-related risks and opportunities, reviewing the performance of the CEO and approving the interim and full year accounts.

DIRECTORS’ REMUNERATION AND BENEFICIAL INTERESTS

Directors’ remuneration and beneficial interests in the Group are disclosed in note 8 to the financial statements.

DIRECTORS’ INDEMNITIES

As detailed in the Company’s Articles of Association, indemnities were in force during the financial year and also at the date of approval of the financial statements between the Company and each of its Directors, under which the Company has agreed to indemnify each Director, to the extent permitted by law, in respect of certain liabilities incurred as a result of carrying out their duties as a Director of the Company. The Company has Directors’ and Officers’ Liability Insurance and it is the intention to maintain such a policy in the future.

INTERNAL CONTROL

The Board takes into consideration the main provisions of the UK Corporate Governance Code 2018 as published insofar as they are appropriate given the Group’s size and stage of development. The Group will continue to evolve internal controls as the business develops.

The Board is responsible for establishing and monitoring internal control systems and for reviewing the effectiveness of these systems. The Board

views the effective operation of a rigorous system of internal controls as critical to the success of the Group.

It recognises that such systems can provide only reasonable and not absolute assurance against material misstatement or loss. The key elements of the Group’s internal control system, all of which have been in place during the financial year and up to the date these financial statements were approved, are as follows:

Control environment and procedures

The Group has a clear organisational structure with defined responsibilities and accountabilities. It adopts the highest values surrounding quality, integrity, and ethics. These values are documented and communicated clearly throughout the Group. The Board considers that the controls have been effective for the period ended 31 March 2025.

There is a formal whistleblowing policy which has been communicated to employees. This policy provides information on the process to follow in the event that any employee feels it is appropriate to make a disclosure.

Identification and evaluation of principal risks and uncertainties

The operations of the Group and the implementation of its objectives and strategy are subject to a number of key risks and uncertainties. Appropriate controls and procedures were in place during the reported period to monitor and, where possible, mitigate these risks. The key risks and uncertainties faced by the Group are set out on pages 32 to 36.

Information and financial reporting systems

The Group has systems and controls in place to ensure adequate accounting records are maintained and transactions are recorded accurately and fairly to permit the preparation of financial statements in accordance with UK-adopted international accounting standards. The Board approves the annual operating budget and receives regular details of actual performance measured against the budget.

POLITICAL DONATIONS

The Group did not make any political donations during the reported period.

POST BALANCE SHEET EVENTS

Material events occurring since the balance sheet date are disclosed in Note 22 to the consolidated financial statements.

STATEMENT OF DISCLOSURE OF INFORMATION TO AUDITORS

The Directors who held office at the date of approval of this Annual Report confirm that:

• so far as they are aware, there is no relevant audit information of which the Group’s auditors are unaware; and

• they have taken all the steps that they ought to have taken as Directors in order to make themselves aware of any relevant audit information and to establish that the Group’s auditors are aware of that information.

GOING CONCERN

The financial statements have been prepared on a going concern basis which the Directors consider to be appropriate for the following reasons. The Directors have prepared a medium-term financial plan, including cash flow forecasts for a period of 12 months from the date of approval of these financial statements which indicate that, taking account of severe but plausible downsides, the Group will have sufficient funds to meet its liabilities as they fall due for a period of 12 months from the date of approval of the financial statements.

The Directors therefore continue to adopt the going concern basis in preparing the annual financial statements.

SMALL COMPANY RULES

This report has been prepared in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006.

On behalf of the Board

Lord Jim O’Neill CHAIRPERSON

13 June 2025

Statement of Directors’ Responsibilities

The Directors are responsible for preparing the Directors’ Report and the Group and Company financial statements in accordance with applicable law and regulations.

Company law requires the Directors to prepare Group and Company financial statements for each financial year. Under that law they have elected to prepare the Group financial statements in accordance with UK-adopted international accounting standards (‘UKadopted IAS’). The Company financial statements are prepared in accordance with the Financial Reporting Standard 101 Reduced Disclosure Framework under United Kingdom Generally Accepted Accounting Practice.

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 Group and Company and of the Group’s profit or loss for that period. In preparing each of the Group and Company financial statements the Directors are required to:

• select suitable accounting policies and apply them consistently;

• make judgements and accounting estimates that are reasonable and prudent; and

• prepare the financial statements on

the going concern basis unless it is inappropriate to presume that the Group or the Company will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group and Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and 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 Group and Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

On behalf of the Board

Lord Jim O’Neill CHAIRPERSON

13 June 2025

SUPPORTING AMBITION IN THE NORTH OF ENGLAND

05 Financial Statements

Independent auditor’s report

to the members of Northern Gritstone Limited

OPINION ON THE FINANCIAL STATEMENTS

In our opinion:

• the financial statements give a true and fair view of the state of the Group’s and of the Parent Company’s affairs as at 31 March 2025 and of the Group’s loss for the year then ended;

• the Group financial statements have been properly prepared in accordance with UK adopted international accounting standards;

• the Parent Company financial statements have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

We have audited the financial statements of Northern Gritstone Limited (‘the Parent Company’) and its subsidiaries (‘the Group’) for the year ended 31 March 2025 which comprise the Consolidated Statement of Comprehensive Income, Consolidated Statement of Financial Position, Consolidated Statement of Cashflows, Consolidated Statement

of Changes in Equity, Company Balance Sheet, Company Statement of Changes in Equity and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in the preparation of the Group financial statements is applicable law and UK adopted international accounting standards. The financial reporting framework that has been applied in the preparation of the Parent Company financial statements is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 101 Reduced Disclosure Framework (United Kingdom Generally Accepted Accounting Practice).

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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We are independent of the Group and the Parent 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.

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 Group or 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.

OTHER INFORMATION

The Directors are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

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.

OTHER COMPANIES ACT 2006 REPORTING

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.

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 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 by the Parent Company, or returns adequate for our audit have not been received from branches not visited by us; or

• the Parent Company financial statements are not in agreement with the accounting records and returns; or

• certain disclosures of Directors’ remuneration specified by law are not made; or

• we have not received all the information and explanations we require for our audit.

RESPONSIBILITIES OF DIRECTORS

As explained more fully in the Statement of Directors Responsibilities, 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 Group’s and the Parent Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or the Parent Company or to cease operations, or have no realistic alternative but to do so.

AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue 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

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

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:

Non-compliance with laws and regulations

Based on:

• Our understanding of the Company and the industry in which it operates;

• Discussion with management and those charged with governance; and

• Obtaining and understanding of the Company’s policies and procedures regarding compliance with laws and regulations;

We considered the significant laws and regulations to be the applicable accounting framework, FCA regulations and UK tax legislation.

The Company is also subject to laws and regulations where the consequence of non-compliance could have a material effect on the amount or disclosures in the financial statements, for example through the imposition of fines or litigations.

Our procedures in respect of the above included:

• Review of minutes of meetings of those charged with governance for any instances of noncompliance with laws and regulations;

• Review of correspondence with tax authorities for any instances of non-compliance with laws and regulations; and

• Review of financial statement disclosures and agreeing to supporting documentation.

Fraud

We assessed the susceptibility of the financial statements to material misstatement, including fraud. Our risk assessment procedures included:

• Enquiry with management and those charged with governance regarding any known or suspected instances of fraud;

• Obtaining an understanding of the Company’s policies and procedures relating to:

- Detecting and responding to the risks of fraud; and

- Internal controls established to mitigate risks related to fraud.

• Review of minutes of meetings of those charged with governance for any known or suspected instances of fraud;

• Discussion amongst the engagement team as to how and where fraud might occur in the financial statements;

• Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to

fraud; and

• Considering remuneration incentive schemes and performance targets and the related financial statement areas impacted by these.

Based on our risk assessment, we considered the areas most susceptible to fraud to be management override of controls, equity rights valuations and fair value of investment balances.

Our procedures in respect of the above included:

• Testing of journal entries throughout the year, which met certain risk criteria, by agreeing to supporting documentation as well as testing a sample of journal entries which didn’t meet the risk criteria;

• Performing sensitivity analysis in respect of the key assumptions within the equity rights model and challenging the judgements made and;

• Evaluating the valuation methodology in respect of the valuation of the fair value of level 3 investment balances to support management judgements made.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members who were all deemed to have appropriate competence and capabilities and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve

deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: 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 Parent 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 Parent 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 Parent Company and the Parent Company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Paul Davies SENIOR STATUTORY AUDITOR

13 June 2025

For and on behalf of BDO LLP, Statutory Auditor Leeds, UK

Consolidated financial statements and notes

CONSOLIDATED STATEMENT OF

COMPREHENSIVE INCOME

The consolidated financial statements on pages 66 to 88 were approved by the Board of Directors of Northern Gritstone Limited (registered number: 12982592) and were signed on its behalf by

James Hadley CHIEF FINANCIAL OFFICER

13 June 2025

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

CONSOLIDATED STATEMENT OF CASHFLOWS

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

i) Called up share capital — The nominal value of subscribed capital which has been called by the Group. See note 19 for additional information.

ii) Share premium — The amount of subscribed share capital which has been called in excess of nominal value net of directly attributable issue costs.

iii) Accumulated deficit — Cumulative net gains and losses recognised in the statement of comprehensive income.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Note 1

Accounting policies

1.1

Basis of preparation

The financial statements of Northern Gritstone Limited (the ‘Company’) and its subsidiary companies (together, the ‘Group’) are for the year ended 31 March 2025. The principal accounting policies adopted in the preparation of the financial statements are set out below. The policies have been consistently applied to all the periods presented. The Group financial statements have been prepared and approved by the Directors in accordance with UK-adopted international accounting standards (‘UK–adopted IAS’). The preparation of financial statements in compliance with UKadopted IAS requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in the most appropriate selection of the Group’s accounting policies. The areas where significant judgements and estimates have been made in preparing the financial statements and their effect are disclosed in note 2.

1.2 Going concern

The financial statements are prepared on a going concern basis. The Directors have prepared a medium-term financial plan, including cash flow forecasts for a period of 12 months from the date of approval of these financial statements which indicate that, taking account of severe but plausible downsides, the Group will have sufficient funds to meet its liabilities as they fall due for a period of 12 months from the date of approval of the financial statements.

1.3 Changes in accounting policies

(i) New standards, interpretations and amendments effective from 1 April 2024

No new standards, interpretations and amendments effective in the period have had a material effect on the Group’s financial statements.

(ii) At the date of authorisation of the financial statements the Group has not applied IFRS 18 Presentation and Disclosure in Financial Statements, which has been issued, but is not yet effective. The impact of applying the new standard is not expected to have a significant impact on the financial statements.

1.4 Basis of consolidation

Where the Company has control over an entity, it is classified as a subsidiary. The consolidated financial statements present the results of the Company and its subsidiaries as if they formed a single entity. Intercompany transactions and balances between Group companies are therefore eliminated in full. The Company controls two wholly-owned subsidiaries which were incorporated in the twelve months ended 31 March 2025: Northern Gritstone Investment Manager Limited and Northern Gritstone Innovation Services Limited. These subsidiaries are consolidated in the financial statements. The year ending 31 March 2025 is the first period in which consolidated financial statements have been prepared for Northern Gritstone Limited.

The majority of the Group’s equity investments are deemed to be associates, as the Group has significant influence but not control over these entities.

The Group holds equity investments in associates and equity investments which are not associates (together ‘equity investments’) at fair value through profit or loss in accordance with IFRS 9. Changes in the fair value of equity investments are presented in profit or loss in the statement of comprehensive income in the period in which they arise.

1.5 Revenue

Revenue from services and other income is earned from the provision of business support services. All revenue from services is generated within the United Kingdom and is stated exclusive of value added tax. Revenue is recognised when the Group satisfies its performance obligations, in line with IFRS 15.

1.6 Property, plant and equipment

All property, plant and equipment are shown at cost less subsequent depreciation and impairment. Cost includes expenditure that is attributable to the acquisition of the items. Depreciation on assets is calculated using the straight-line method to allocate the cost of each asset to its residual value over its estimated useful life, as follows:

Computer equipment

Office furniture

1.7 Financial assets

Over 3 years

Over 3 years

The Group recognises or derecognises financial assets based on trade date accounting, being the date on which the Group becomes legally bound by the transaction.

The Group classifies its financial assets into one of the categories listed below, depending on the purpose for which the asset was acquired.

(i) At fair value through profit or loss

Financial assets are recognised at fair value through profit or loss. This category includes equity investments and equity rights. None of the Group’s financial assets are categorised as held for trading.

Financial assets at fair value through profit or loss are initially recognised at fair value and any gains or losses arising from subsequent changes in fair value are presented in profit or loss in the statement of comprehensive income in the period in which they arise.

Fair value hierarchy

The Group classifies financial assets using a fair value hierarchy that reflects the significance of the inputs used in making the related fair value measurements. The level in the fair value hierarchy within which a financial asset is classified is determined on the basis of the lowest level input that is significant to that asset’s fair value measurement.

The fair value hierarchy has the following levels:

Level 1 Quoted prices in active markets.

Level 2 Inputs other than quoted prices that are observable, such as prices from market transactions.

Level 3 One or more inputs that are not based on observable market data.

Transfers between levels of the fair value hierarchy are deemed to have occurred on the date of the event or change in circumstances that caused the transfer.

Equity investments

Fair value is the underlying principle and is defined as ‘the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date’ (IFRS 13.9).

Where the equity structure of an investment involves different class rights in a sale or liquidity event, the Group takes these different rights into account when forming a view on the value of its investment.

Valuation techniques used

The fair value of unlisted securities is established using appropriate valuation techniques in line with International Private Equity and Venture Capital Valuation guidelines. The selection of appropriate valuation techniques is considered on an individual basis in light of the nature, facts and circumstances of the investment and in the expected view of market participants. The Group selects valuation techniques which make maximum use of market-based inputs. Techniques are applied consistently from period to period, except where a change would result in better estimates of fair value. Several valuation techniques may be used so that the results of one technique may be used as a cross check / corroboration of an alternative technique.

Valuation techniques used include:

• Quoted investments: the fair values of quoted investments are based on bid prices in an active market at the reporting date.

• Milestone approach: an assessment is made as to whether there is an indication of change in fair value based on a consideration of the relevant milestones typically agreed at the time of making the investment decision.

• Scenario analysis: a forward-looking method that considers one or more possible future scenarios. These methods include simplified scenario analysis and relative value scenario analysis, which tie to the fully diluted equity value, as well as full scenario analysis via the use of the probability-weighted expected return method.

• Discounted cash flows: deriving the value of a business by calculating the present value of expected future cash flows.

• Multiples: the application of an appropriate multiple to a performance measure (such as earnings or revenue) of the investee company in order to derive a value for the business.

The fair value indicated by a recent transaction is used to calibrate inputs used with valuation techniques including those noted above. At each measurement date, an assessment is made as to whether changes or events subsequent to the relevant transaction would imply a change in the investment’s fair value. The price of a recent investment is not considered a standalone valuation technique (see further considerations below).

Price of recent investment as an input in assessing fair value

The Group considers that fair value estimates which are based primarily on observable market data will be of greater reliability than those based on assumptions. Given the nature of the Group’s investments in seed, start-up and early-stage companies, where there are often no current and no short-term future earnings or positive cash flows, it can be difficult to gauge the probability and financial impact of the success or failure of development or research activities and to make reliable cash flow forecasts. Consequently, in many cases the most appropriate approach to fair value is a valuation technique which is based on market data such as the price of a recent investment, and market participant assumptions as to potential outcomes.

Calibrating such scenarios or milestones may result in a fair value equal to price of recent investment for a limited period of time. Often qualitative milestones provide a directional indication of the movement of fair value.

In applying a calibrated scenario or milestone approach to determine fair value, consideration is given to performance against milestones that were set at the time of the original investment decision, as well as taking into consideration the key market drivers of the investee company and the overall economic environment. Factors that the Group considers include: technical measures such as product development phases and patent approvals, financial measures such as cash burn rate and profitability expectations, and market and sales measures such as testing phases, product launches and market introduction.

Where the Group considers that there is an indication that the fair value has changed, an estimation is made of the required amount of any adjustment from the last price of recent investment.

Where a deterioration in value has occurred, the Group reduces the carrying value of the investment to reflect the estimated decrease. If there is evidence of value creation the Group may consider increasing the carrying value of the investment.

Equity rights

The equity rights asset represents the present value of the founders’ equity of spinout companies that the Group will receive, at no cost, from the Universities of Leeds, Manchester and Sheffield, under the Framework Agreement signed with these universities on 20 April 2021. The Group has received these rights for the period to 20 April 2036 in return for the Universities of Leeds, Manchester and Sheffield receiving a shareholding in Northern Gritstone Limited. The equity rights asset is considered to be a derivative financial asset and is designated as at fair value through profit or loss. Further details on the treatment of this asset are included in note 13.

(ii)

At amortised cost

These assets are non-derivative financial assets with fixed and determinable payments that are not quoted in an active market. They arise principally through the provision of services to customers (trade receivables) and are carried at cost less provision for impairment.

1.8 Cash and cash equivalents

Cash and cash equivalents include cash in hand and short-term deposits held with financial institutions with an original maturity of three months or less.

1.9 Financial liabilities

Current financial liabilities are composed of trade payables and other short-term monetary liabilities, which are recognised at amortised cost.

The Group employed the services of a placement agent to assist with the raising of capital. Fees are payable to this agent as ordinary share capital is paid up. The Group estimates that all of the ordinary share capital will be paid up in the future and recognises a provision for the fees payable to the placement agent in relation to the uncalled share capital.

1.10 Share capital

Financial instruments issued by the Group are treated as equity to the extent they have been called up. Where shares are nil paid and there are no arrangements for any future payments such shares are not reflected in the Group’s accounts as called-up share capital until such time as the company makes calls on the shares or there is subsequently an agreed date for payment.

1.11 Employee benefits

(i) Pension obligations

The Group operates a defined contribution pension scheme for which all employees are eligible. The assets of the scheme are held separately from those of the Group in independently administered funds. The Group currently makes contributions on behalf of employees to this scheme. The Group has no further payment obligations once the contributions have been paid. The contributions are recognised as employee benefit expenses when they are due.

(ii) Share-based payments

The Group engages in equity-settled share-based payment transactions in respect of services receivable from employees, by granting employees conditional awards of ordinary shares subject to certain vesting conditions. The fair value of the shares is estimated at the date of grant, taking into account the terms and conditions of the award, including market-based performance conditions.

The fair value at the date of grant is recognised as an expense over the period that the employee provides services, generally the period between the start of the performance period and the vesting date of the shares. Where the performance conditions of an award are deemed to have been substantially met at the date of grant, an expense is recognised in full. The corresponding credit is recognised in the share-based payments reserve within total equity. The fair value of services is calculated using the market value on the date of award and is adjusted for expected and actual levels of vesting.

Where conditional awards of shares lapse, the expense recognised to date is credited to the statement of comprehensive income in the year in which they lapse. Where the terms for an equity-settled award are modified, and the modification increases the total fair value of the share-based payment, or is otherwise beneficial to the employee at the date of modification, the incremental fair value is amortised over the vesting period.

(iii) Long-term incentive plan

The Group operates a cash based long-term incentive plan (‘LTIP’) for certain employees. Before any payment to a participant becomes due, the Group’s investments made within a specific time period (currently 01 April 2022 to 31 March 2024 for the first vintage and 01 April 2024 to 31 March 2026 for the second vintage) must have achieved a compounded hurdle rate of 7% per annum based on both realised and unrealised returns. Each vintage vests seven years after its start date and no amounts are payable to participants before this date. At the point at which the hurdle rate has been exceeded, a provision is included for the unrealised gain potentially due to participants. The provision is measured by reference to the fair value estimates for the relevant portfolio investments, with movements in the provision charged / credited to the statement of comprehensive income.

1.12 Leases

All leases are accounted for by recognising a right-of-use asset and a lease liability except for:

• Leases of low value assets; and

• Leases with a duration of 12 months or less.

1.13 Contingent liabilities

Contingent liabilities are not recognised, except those acquired in a business combination. Contingent liabilities arise as a result of past events when (i) it is not probable that there will be an outflow of resources or that the amount cannot be reliably measured at the reporting date or (ii) when the existence will be confirmed by the occurrence or non-occurrence of uncertain future events not wholly within the Group’s control. Contingent liabilities are disclosed in the financial statements unless the probability of an outflow of resources is remote.

Note 2

Significant accounting estimates and judgements

The Directors make judgements and estimates concerning the future. Estimates and judgements are continually evaluated and are based on historical experience and other factors, such as expectations of future events, and are believed to be reasonable under the circumstances. Actual results may differ from these estimates. The estimates and assumptions, which have a significant effect on the carrying amounts of the assets and liabilities in the financial statements, are in respect of:

(i) Valuation of unquoted equity company

The Group’s accounting policy in respect of the valuation of unquoted equity investments is set out in note 1. In applying this policy, the key areas over which judgement is exercised include:

• Consideration of whether a funding round is at arm’s length and therefore representative of fair value.

• The relevance of the price of recent investment as an input to fair value, which typically becomes more subjective as the time elapsed between the recent investment date and the balance sheet date increases.

• In the case of companies with complex capital structures, the appropriate methodology for assigning value to different classes of equity based on their differing economic rights.

• Where using valuation methods such as discounted cash flows or revenue multiples, the assumptions around inputs including the probability of achieving milestones and the discount rate used, and the choice of comparable companies used within revenue multiple analysis.

• When determining the fair value of founder equity received, consideration is given to the presence of sophisticated third-party co-investors investing on similar terms.

Valuations are based on management’s judgement after consideration of the above and upon available information believed to be reliable, which may be affected by conditions in the financial markets. Due to the inherent uncertainty of the investment valuations, the estimated values may differ significantly from the values that would have been used had a ready market for the investments existed, and the differences could be material. Sensitivity analysis around these estimates is included in note 12.

(ii) Valuation of Equity Rights

The judgements required to determine the valuation of Equity Rights have a significant risk of causing a material adjustment to the carrying amounts of the assets. The judgements include assessing the likelihood of exit methods and proceeds of investments sold, the failure rate, the discount rate and the number of spinouts invested in per year.

Sensitivity analysis around these estimates is included in note 13.

(iii) Equity-settled share-based payments

Determining the fair value of equity-settled share-based payments at the measurement date represents a significant accounting estimate. There is inherent judgement in the key inputs into the valuation.

Note 3

Financial risk management

As set out in the principal risks and uncertainties section on pages 32 to 36, the Group is exposed, through its normal operations, to a number of financial risks, the most significant of which are market, liquidity and credit risks.

Risk management is carried out under policies approved by the Board of Directors.

(a) Market risk

(i) Price risk

The Group is exposed to equity securities price risk as a result of its investments, categorised as at fair value through profit or loss. The Group mitigates this risk by having established investment appraisal processes and asset monitoring procedures which are subject to overall review by the Board. The Group holds investments which are not traded on an active market.

(ii) Interest rate risk

As the Group has no borrowings, it has only a limited interest rate risk. The primary impact to the Group is the impact on income and operating cash flow as a result of the interest-bearing deposits and cash and cash equivalents held by the Group.

(b) Liquidity risk

The Group seeks to manage liquidity risk, to ensure sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably. Accordingly, the Group only invests working capital in instruments issued by highly rated counterparties. The Group continually monitors rolling cash flow forecasts to ensure sufficient cash is available for anticipated cash requirements.

(c) Credit risk

The Group’s credit risk is primarily attributable to its deposits, cash and cash equivalents. The Group seeks to mitigate its credit risk on cash and cash equivalents by making deposits with highly rated institutions.

Note 4

Revenue from services

Revenue represents the invoiced value of services supplied to investee companies excluding value added tax. Revenues are recognised as performance obligations are delivered.

Note 5

Operating segments

The Group’s operations are wholly within the UK. For management reporting the Group is organised into one operating segment being the commercialisation of intellectual property developed by businesses based in the North of England.

Note 6

Auditor’s remuneration

Note 7

Other administrative expenses

Note 8

Employee costs

The average number of persons (including the Executive Directors and Non-Executive Directors) employed by the Group during the twelve months ended 31 March 2025 was 27 (2024: 19).

The total emoluments paid to Directors in the twelve months ended 31 March 2025 were £2,263,000 (2024: £1,858,000) and the highest-paid Director received emoluments of £1,313,000 (2024: £988,000).

At 31 March 2025 one Director (2024: one) was a member of a defined contribution pension scheme to which the Group contributed.

The Directors who held office during the period ended 31 March 2025 had the following beneficial interests in the shares of the Company:

The Directors who held office during the period ended 31 March 2025 had the following beneficial interests in options over the ordinary shares of the Company:

There are two Directors who participate in the LTIP scheme. Amounts in relation to the LTIP become payable once certain performance criteria and the vesting period conditions have been met. No amounts have been paid or have become payable during the twelve months ended 31 March 2025 as these criteria have not yet been met. See note 16 for details of amounts provided in relation to the LTIP.

Note 9 Finance income / (costs)

Note 10 Taxation

There were no deferred tax assets or liabilities recognised by the Group during the period reported (2024: £nil). A deferred tax asset would be recognised only when sufficient taxable profits are expected to be generated to relieve the trading losses. An analysis is shown below:

The UK corporation tax rate was 25% in the period to 31 March 2025. This rate has been used for the purposes of preparing the tax charge disclosures and the deferred tax disclosures.

Note 11 Fixed assets

Note 12

Equity investments

The fair values of the level 2 investments are supported by recent market transactions that have occurred within 12 months of the reporting date. In addition, the fair value of all investments have been corroborated by the valuation techniques described in note 1.

The founder equity received during the period relates to the receipt of university equity in Exciting Instruments Limited, MicroLub Limited, Cavero Quantum Limited and Apini Therapeutics Limited under the Framework agreement at nil cost.

The reasons for the change in fair value during the period are detailed in the Portfolio update which appears on pages 12 to 13 of this annual report. The vast majority of the transfers between hierarchy levels in the period were the result of a market transaction ceasing to have occurred within the last twelve months.

At 31 March 2025 the Group had committed, subject to certain milestone provisions contained in the relevant legal documentation, to make further investments of £3,040,000 (2024: £4,333,000) in investee companies. As these relate to future investments, they have not been included in the financial statements.

Investment valuations require management judgement, with the key areas over which judgement is exercised described in note 2. Illustrative sensitivities around the judgements applied to investment fair values at 31 March 2025 are:

NAME OF INVESTEE

adsilico Limited

Apini Therapeutics Limited

Auxetec Limited

Bettering Our Worlds (BOW) Limited

Cable Coatings Limited (t/a Asset Cool)

Cavero Quantum Limited

C-Capture Limited

Details of investee companies: * Investment by way of advanced subscription agreement

Nexus, Discovery Way, University of Leeds, Leeds, LS2 3AA, UK

Burnham House, Splash Lane, Wyton, Huntingdon, PE28 2AF, UK

Nexus, Discovery Way, University of Leeds, Leeds, LS2 3AA, UK

Bow Sheffield Science Park, Cooper Buildings, Arundel Street, Sheffield, England, S1 2NS, UK

Innovation Centre, 103 Clarendon Road, Leeds, LS2 9DF, UK

Nexus, Discovery Way, Leeds, England, LS2 3AA, UK

Windsor House, Cornwall Road, Harrogate, England, HG1 2PW, UK

CCU International Limited * - 5 South Charlotte Street, Edinburgh, Scotland, EH2 4AN, UK

Crucible Therapeutics Limited

The Innovation Centre, 217 Portobello, Sheffield, S1 4DP, UK

The Innovation Centre, 217 Portobello, Sheffield, S1 4DP, UK

Evolutor Limited * - The Innovation Centre, 217 Portobello, Sheffield, S1 4DP, UK

Sheffield Technology Parks, Cooper Buildings, Arundel Street, Sheffield, S1 2NS, UK

Iceotope Group Limited 7% Amp Technology Centre, Brunel Way, Rotherham, S60 5WG, UK

Imperagen

Unit 11, Williams House Lloyd Street North, Manchester Science Park, Manchester, M15 6SE, UK

Instruct3d Limited * - The Innovation Centre, 217 Portobello, Sheffield, S1 4DP, UK

Mignon Technologies Limited (t/a Literal Labs)

Mimetrik Solutions Limited

NIQS TECH (Leeds) Limited *

3rd Floor Maybrook House, 27-35 Grainger Street, Newcastle Upon Tyne, NE1 5JE, UK

Nexus, Discovery Way, Leeds, West Yorkshire, LS2 3AA, UK

Nexus, Discovery Way, Leeds, West Yorkshire, LS2 3AA, UK

Suite 1, 5th Floor 31-32 Park Row, Leeds, West Yorkshire, LS1 5JD, UK Optalysys Limited

7d Platform New Street, Leeds, West Yorkshire, LS1 4JB, UK

Innovation Centre, 217 Portobello, Sheffield, South Yorkshire, S1 4DP, UK

3f38, Mereside Alderley Park, Macclesfield, Cheshire, SK10 4TG, UK Phagenesis Limited

The Elms Courtyard, Bromsberrow, Ledbury, HR8 1RZ, UK

PhovIR Technologies Limited * - 46 Grafton Street, Manchester, M13 9NT, UK Phlux Technology Limited 17% The Innovation Centre, 217 Portobello, Sheffield, S1 4DP, UK

Neville Hamlin Building, Thomas Wright Way, NET Park, Sedgefield, Co. Durham TS21 3FG, UK QV Bioelectronics

1F70 Mereside, Alderley Park, Nether Alderley, Cheshire, SK10 4TG, UK

8 Hewitt Street, Manchester, M15 4GB, UK Renewfood Limited * - The Innovation Centre, 217 Portobello, Sheffield, S1 4DP, UK Samson VTI UK Ltd (t/a Partful)

Simanalytica Limited

3rd Floor 24 Lever St, Manchester, M1 1DZ, UK

New Cambridge House, Bassingbourn Road, Litlington, Royston, SG8 0SS, UK

Nexus, Discovery Way, Leeds, England, LS2 3AA, UK

Note 13

Equity rights

Equity rights represent the present value of the founders’ equity of spinout companies that the Group will receive, at no cost, from the Universities of Leeds, Manchester and Sheffield, under the Framework Agreement signed with these universities on 20 April 2021 subject to the Group investing a minimum of £200,000. The Group has received these rights for the period to 20 April 2036 in return for each of the Universities of Leeds, Manchester and Sheffield receiving a 2% non-dilutable shareholding in Northern Gritstone Limited.

The founder equity received during the period is recognised within equity investments.

The change in fair value during the period relates to the need to assess the present value as at 31 March 2025 of the founders’ equity of spinout companies that the Group will receive. This assessment of fair value includes updating assumptions for the latest market data.

The key variables which the Directors consider are relevant in determining a fair value for this financial asset are set out below. These variables are informed by market data.

EXIT TIMING

The fair value of this financial asset is sensitive to a range of variables, the most significant of which are:

• A change in the discount rate. Were this reduced to 15%, the fair value of the financial asset at 31 March 2025 would be £36.1m. Were the discount rate increased to 25%, the fair value of the financial asset at 31 March 2025 would be £18.6m.

• The long-term number of spinout companies financed per annum. Were this reduced to 8, the fair value of the financial asset at 31 March 2025 would be £23.0m. Were this increased to 10, the fair value of the financial asset at 31 March 2025 would be £27.7m.

• The average equity stake acquired by the Group. Were this reduced to 10%, the fair value of the financial asset at 31 March 2025 would be £16.9m. Were this increased to 20%, the fair value of the financial asset at 31 March 2025 would be £33.8m.

• The proportion of spinout companies failing. Were this reduced to 60%, the fair value of the financial asset at 31 March 2025 would be £33.8m. Were this increased to 80%, the fair value of the financial asset at 31 March 2025 would be £16.9m.

Note 14 Trade and other receivables

receivables are interest-free and unsecured. None of the trade debtors balance is overdue and the Directors have not recognised a provision for impairment (2024: nil).

Note 15 Trade and other payables

Note 16

Provision for liabilities and charges

Long-term incentive plan liability

An overview of the long-term incentive plan scheme is given in note 1.11. There are two long-term incentive plan vintages in operation at 31 March 2025. These vest on 31 March 2029 and 31 March 2031. Based on the current fair value estimates for the relevant portfolio investments, the hurdle rate has not been exceeded in either of these vintages as at 31 March 2025. Consequently, no potential unrealised gain due to participants has been recognised. Upon maturity, the LTIP will be wholly cash settled.

Provision for other liabilities and charges

The Group employed the services of a placement agent to assist with the raising of capital. Fees are payable to this agent as ordinary share capital is paid up. The Group estimates that all of the ordinary share capital will be paid up in the future and recognises a provision for the fees payable to the placement agent in relation to the uncalled share capital.

Note 17

Leases

All leases are accounted for by recognising a right-of-use asset and a lease liability except for:

• Leases of low value assets; and

• Leases with a duration of 12 months or less.

The following amounts in respect of leases have been recognised in the profit or loss:

Note 18

Share-based payments

Share option plan

The Group operates equity-settled share option plans for certain employees. The terms of the plans provide that shares may be acquired at a fixed price once vested. The plans are subject to good leaver / bad leaver provisions.

The fair value of the options over shares held by participants in the share option plans has been calculated based on the fair value of the shares at the date of grant less the nominal exercise price. During the twelve months ended 31 March 2025 a charge of £834,000 (2024: £610,000) has been recorded in relation to options over shares held by participants in the share option plans.

Management shares

Certain employees have subscribed for ordinary shares at a discount (‘management shares’). The management shares vest over a five year period from the date of issue and are subject to good leaver / bad leaver provisions. The difference between the fair value of the management shares issued and the price payable has been recorded as a charge in the income statement, spread over the vesting period. During the twelve months ended 31 March 2025 this charge totalled £193,000 (2024: £ £193,000).

Note 19

Share capital

The Company is limited by shares. The ordinary shares carry equal voting rights, equal rights to income and distributions of assets on liquidation, or otherwise, and no right to fixed income.

The special shares are held by the Universities of Leeds, Manchester and Sheffield. These special shares:

• Entitle each of the Universities of Leeds, Manchester and Sheffield to be issued ordinary shares for no consideration if, on the issue of ordinary shares to third parties, their individual shareholding falls below 2.0% of the then in issue ordinary shares;

• Carry no right to participate in the income of the Company;

• Carry no right to attend, speak or vote at, any general meeting of the Company;

• Entitle the holder to the nominal value of the special shares on a return of capital on liquidation or otherwise; and

• Are not transferable.

During the twelve months ended 31 March 2025 the Company:

• Issued 50,250,000 ordinary shares at a subscription price of £1.00. Of these ordinary shares, 8,750,000 had been called up and fully paid as at 31 March 2025 and 8,873,500 had been called up, but not paid at 31 March 2025;

• Called up an additional 5% of share capital from all other ordinary shareholders. Of these 10,652,083 ordinary shares called up in the period, all had been fully paid as at 31 March 2025; and

• Converted 3,207,447 special shares into ordinary shares at nil cost.

In the period ended 31 March 2023 the Company received a commitment to subscribe for up to 100,000,000 preference shares of £1.00 each at a subscription price of £1.00. As at 31 March 2025 these preference shares were not allotted.

Note 20

Categorisation of financial instruments

Note 21 Related party transactions

The Group discloses transactions with related parties that are not subsidiaries. The Group provided business support services to its associates in the period, chargeable on an arm’s length basis. The following amounts have been included in respect of these fees:

The Group makes investments in the equity of unquoted investments in which it is possible to exert significant influence. The Group holds investments in associates at fair value through profit or loss in accordance with IFRS 9, but they are related parties. The total amounts included for investments where the Group has significant influence are as follows:

ended

ended

STATEMENT OF COMPREHENSIVE INCOME

Vero HR Limited, where Andrew Graham serves as Chairperson, charged the Group with fees of £7.7k during the twelve months ended 31 March 2025 in relation to HR services, all at arm’s length (2024: £5.7k). As at 31 March 2025 £0.9k was outstanding, but not overdue.

SUEL Limited, which is a wholly-owned subsidiary of the University of Sheffield, charged the Group with fees of £3.0k during the twelve months ended 31 March 2025 in relation to accounting services, all at arm’s length (2024: £12.0k). As at 31 March 2025 no amounts were outstanding or overdue.

Bruntwood Circle Square 4 Limited, which is a wholly owned subsidiary of the Bruntwood Group Limited (a shareholder of the Company), charged the Group with fees of £82.0k during the twelve months ended 31 March 2025 in relation to property services, all at arm’s length (2024: £59.2k). As at 31 March 2025 no amounts were outstanding or overdue.

Nexus Limited, which is a wholly-owned subsidiary of the University of Leeds, charged the Group with fees of £52.6k during the twelve months ended 31 March 2025 in relation to property services, all at arm’s length (2024: £44.7k). As at 31 March 2025 £0.3k was outstanding, but not overdue.

Accelerator Advisory Limited (trading as Deeptech Labs), where Alex Macpherson serves as an advisor and is a participant in a group carry scheme, provided consulting services to the Group during the twelve months ended 31 March 2025. In relation to these services, in the twelve months ended 31 March 2025 the Company transferred the following number of ordinary shares in investees to Accelerator Advisory Limited: 3,290 in MicroLub Limited, 744 in Exciting Instruments Limited and 848 in Bettering Our Worlds (BOW) Ltd (2024: nil).

Compensation to key management comprises costs relating to Executive Directors, Non-Executive Directors and the Senior Leadership Team of the Group that held positions during the period. Compensation to key management comprise:

Note 22

Post balance sheet events

There are no material post balance sheet events to disclose.

Company financial statements and notes

COMPANY BALANCE SHEET

COMPANY STATEMENT OF CHANGES IN EQUITY

i) Called up share capital — The nominal value of subscribed capital which has been called by the Company. See note K for additional information.

ii) Share premium — The amount of subscribed share capital which has been called in excess of nominal value net of directly attributable issue costs.

iii) Accumulated deficit — Cumulative net gains and losses recognised in the statement of comprehensive income.

The financial statements on pages 90 to 96 were approved by the Board of Directors of Northern Gritstone Limited (registered number: 12982592) and were signed on its behalf by

James Hadley CHIEF FINANCIAL OFFICER

13 June 2025

NOTES TO THE COMPANY FINANCIAL STATEMENTS

Note A Accounting policies

The financial statements of Northern Gritstone Limited (the ‘Company’) are for the year ended 31 March 2025. These financial statements are prepared in accordance with the Financial Reporting Standard 101 Reduced Disclosure Framework (‘FRS 101’). In preparing these financial statements, the Company applies the recognition, measurement and disclosure requirements of UK-adopted international accounting standards (‘UK-adopted IFRS’) but makes amendments where necessary in order to comply with the Companies Act 2006 and has set out below where advantage of the FRS 101 disclosure exemptions has been taken.

Under section s408 of the Companies Act 2006 the Company is exempt from the requirement to present its own profit and loss account. In these financial statements, the Company has applied the exemptions available under FRS 101 in respect of the following disclosures: a cash flow statement and related notes; disclosures in respect of transactions with wholly owned subsidiaries; from presenting a comparative period reconciliation for share capital, the effects of new but not yet effective IFRSs; and disclosures of compensation of key management personnel. As the consolidated financial statements include the equivalent disclosures, the Company has also taken the exemptions under FRS 101 available in respect of the following disclosures: IFRS 2 Share-Based Payments in respect of Group-settled share-based payments; certain disclosures required by IFRS 13 Fair Value Measurement; and the disclosures required by IFRS 7 Financial Instrument Disclosures. The Company proposes to continue to adopt the reduced disclosure framework of FRS 101 in its next financial statements.

These financial statements are prepared on a going concern basis. The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these financial statements. The accounting policies adopted by the Company and the significant accounting estimates and judgements made by the Company are the same as those disclosed in notes 1 and 2 of the consolidated financial statements with the addition of those items noted below.

Subsidiary investments

Investments in subsidiaries are stated at cost. The Company tests the investment balances for impairment annually or whenever there is an indication that the value of carrying amounts may not be recoverable.

Intercompany loans

All intercompany loans are initially recognised at fair value and subsequently measured at amortised cost. Where intercompany loans are intended for use on a continuing basis in a subsidiary company’s activities, and there is no intention of their settlement in the foreseeable future, they are presented as non-current assets.

Note B

Results of the Company

The Company has taken advantage of the exemption granted by Section 408 of the Companies Act 2006 whereby no individual income statement of the Company is disclosed. The Company’s loss for the financial year after tax was £10,670,000 (2024: £3,783,000 loss).

Note C

Directors’ emoluments and employee information

The number of persons (including the Executive Directors and Non-Executive Directors) employed by the Company at 31 March 2025 was 3 (31 March 2024: 18).

Note D Taxation

There were no deferred tax assets or liabilities recognised by the Company during the period reported (2024: £nil). A deferred tax asset would be recognised only when sufficient taxable profits are expected to be generated to relieve the trading losses. An analysis is shown below:

The UK corporation tax rate was 25% in the period to 31 March 2025. This rate has been used for the purposes of preparing the tax charge disclosures and the deferred tax disclosures.

E

Note F Disclosures presented in the Consolidated Financial Statements

The following disclosures are presented in the consolidated financial statements:

Note G

Investment in subsidiary undertakings

Share based payment additions relate to employees of subsidiaries. Details of the Company's subsidiary undertakings as at 31 March 2025 are:

Proportion of fully diluted nominal value held

All subsidiary companies are incorporated in England and their registered office is No.1 Circle Square, 3 Symphony Park, Manchester, M1 7FS.

Note H Loans to subsidiary undertakings

The Directors consider the carrying amount of loans to subsidiary undertakings at amortised cost to approximate their fair value. The amounts due from subsidiary undertakings are interest free, repayable on demand and unsecured. All loans are classified as non-current as they are not expected to be recalled within one year. There are no indications of impairment at the period end.

All receivables are interest-free and unsecured. None of the trade debtors balance is overdue and the Directors have not recognised a provision for impairment (2024: nil).

Note J Trade and other payables

All payables are interest-free and unsecured. None of the trade creditors balance is overdue.

ALTERNATIVE PERFORMANCE MEASURES

The Group assesses performance using Alternative Performance Measures (‘APMs’) which are not defined under IFRS. The Directors believe that these APMs assist in providing additional useful information on the underlying trends, performance and position of the Group. Consequently, APMs are used by the Directors and management for performance analysis, planning, reporting and incentive-setting purposes.

Definitions of the measures presented in the annual report and accounts are set out below.

&

Invested & Committed Co-investment

The value of capital invested by Northern Gritstone in equity investments since the inception of the Group

The value of capital invested and committed by Northern Gritstone in equity investments since the inception of the Group

Since the inception of Northern Gritstone to the reporting date, the value of capital invested and committed by third party investors in funding rounds in which Northern Gritstone has participated and subsequently

The internal rate of return calculated using total equity investment valuations and realisations compared to the total capital invested into the portfolio companies, over the period from inception to reporting date

The change in the number of people employed by companies in which Northern Gritstone has invested from the point of Northern Gritstone’s first investment to the reporting date

Company information and advisers

Northern Gritstone offices

LEEDS

Nexus

Discovery Way

Leeds LS2 3AA

Bankers

HSBC UK Bank plc

1 Centenary Square

Birmingham B1 1HQ

National Westminster

Bank plc

250 Bishopsgate

London EC2M 4AA

LONDON 60 Petty France London SW1H 9EU

Legal Adviser

Macfarlanes LLP 20 Cursitor Street

London EC4A 1LT

Company Registration Number 12982592

MANCHESTER

No.1 Circle Square

3 Symphony Park Manchester M1 7FS

Independent Auditor

BDO LLP 55 Baker Street

London W1U 7EU

SHEFFIELD

The Innovation Centre 217 Portobello Sheffield S1 4DP

| University of Sheffield