Half-year Results

Gateley, the professional services group, is pleased to announce its unaudited results for the six months ended 31 October 2023 (the "Period" or "H1 24").

Financial Highlights

Rod Waldie, Chief Executive Officer of Gateley, said:

"Given macro-economic conditions during the Period, I am pleased with the Group's resilient H1 24 performance.

"This is testament to, firstly, our strong client relationships, sustained by the excellent service delivered by our people and, secondly, our strategy working in practice as we continue to differentiate Gateley and enhance resilience via the aggregation of, and continued investment in, complementary legal and consultancy services on each of our Platforms.

"Our H2 24 outlook reflects our cautious view on the market conditions we are currently experiencing. That said, I am confident in the ability of our excellent teams to continue to rise to the challenge for the remainder of this year, and beyond. We continue to invest in the business and remain confident and well-positioned to deliver our long-term ambitions."

The Group's performance during H1 24 is pleasing in the context of macro-economic headwinds which continue to generate challenging market conditions.

As always, I am grateful to all of our people for their hard work and commitment to delivering the best outcomes for our clients, the result of which is reflected in our 7.6% headline H1 24 revenue growth and our 4.6% growth in underlying profit before tax.

Aided by our strong balance sheet, we maintain a long-term commitment to growth via our disciplined diversification strategy in both legal and consultancy services. This remains our key differentiator and continues to enhance our resilience. In Period, on our Property Platform, we completed the acquisition of RJA, a chartered surveying practice providing project management and quantity surveying services, adding to related expertise in both Gateley Vinden and Gateley Smithers Purslow. We also made strategic lateral hires on our Business Services Platform, firstly, to seed specialist legal services class actions and international arbitration teams handling complex, long-term litigation and, secondly, in our patent and trade mark attorney businesses to add intellectual property commercialisation and valuation services. Whilst our investments inevitably impact short-term margin as acquisition and integration costs are absorbed, selective strategic investment remains one of our priorities for future growth.

In Period, we published our third annual Responsible Business Report. Having achieved all 15 responsible business targets set in our prior report, our 2023/24 report sets 15 new objectives in-line with our purpose-led agenda. We have a clear recognition that business is a key engine for change and our responsible business journey progresses with conviction.

Our operational focus for the remainder of the financial year remains firmly on the basics of business; consistent delivery of excellent service, maximising cross-selling opportunities, winning new work on each of our Platforms and cost management.

The board proposes an interim dividend of 3.3p per share (H1 23: 3.3p).

Results overview

H1 24 Group revenues grew by 7.6% to £82m (H1 23: £76.1m). This yielded an increase of 16.8% in reported profit before tax to £7.4m (restated H1 23: £6.3m) and a 4.6% increase in underlying profit before tax to £10.0m (H1 23: £9.6m).

Trading conditions were generally difficult throughout the Period. Our outturn reflects the quality and breadth of the complementary legal and consultancy services delivered through our Platforms. The volume of traditional transactional activity in legal services was weaker during the Period than in H1 23. This accounts for the slight in-Period decline in utilisation to 83%, but still close to our typical 85% run-rate. We continued to see a pivot towards greater activity in our more counter-cyclical service lines. This is an ongoing characteristic. Activity in our more economically agnostic businesses was, and remains, strong, as demonstrated by 39.0% growth in revenue in Gateley Smithers Purslow, delivering specialist advice from our Property Platform to UK property insurers.

The strength of both existing operations and our balance sheet provide the foundation for further investment in growth across our Platforms. Our pipeline of acquisition opportunities remains good across the Group.

Business Services Platform

On this Platform revenue grew by 24.7%.

Our commercial dispute resolution team and our regulatory and business defence team, counter-cyclical in nature, are both busy and ahead of prior year revenue.

Taken together, our patent and trade mark attorney businesses, Adamson Jones and Symbiosis IP, are in-line with budgeted revenue and are working well together, with a positive outlook. We continue to invest in broadening our intellectual property offering with the in-Period lateral hire additions of experts in IP commercialisation and valuation. We are encouraged by further opportunities to further strengthen our position in intellectual property advisory services.

Revenue from our legal services complex international recoveries litigation team remains constrained whilst the team establishes credentials in new markets. However, activity is improving via opportunities from those markets. In-Period, the team has been significantly enhanced by lateral hire investment to seed our international arbitration team. Alongside this, we have also made lateral hire investment to establish our class actions team, a new service line in our complex litigation offering. We are excited by the opportunities for both teams in handling valuable long-term mandates, from which we expect to see returns feeding-in from FY 25 onwards.

Corporate Platform

In a market where transactional activity has fallen and lead times have extended, I was encouraged to see relatively small revenue contraction of 5.9% on this Platform . Our traditional transaction pipeline is reasonable but timelines for on-boarding and completing new work are uncertain.

The Platform also houses our Restructuring Advisory team, which is counter-cyclical in nature. Its revenue increased by 41.5% and the team remains busy on a number of mandates, with a positive outlook. Work here includes cross-over with specialist teams on our Property Platform delivering market-leading services to insurers who have bonded now distressed construction projects.

People Platform

This Platform supports clients dealing with and developing people and in administering individuals' personal affairs.

Revenue on this Platform declined by 1.2%. In legal services, our employment team experienced a drop-off in support work to the transactional teams on our Corporate Platform. However, utilising expertise established over many years in acting for The British Medical Association, the team is now building its credentials in assisting NHS Trusts with internal investigations. Our private client team has undertaken some restructuring, with our core focus remaining on high net worth clients and related opportunities.

Our legal services pensions team and our pension trustee business, Entrust, are both relatively economically agnostic and combined to deliver revenue growth of 52.4%. Entrust continues to see opportunities from the increase in the number of pension schemes looking to complete full liability buy-outs, with Entrust's technical support.

The combined revenue of our talent assessment, development and cultural change businesses, t-three and Kiddy & Partners is down versus H1 23 but improvement is anticipated in H2 24. These businesses are also working closely with our legal services employment team to maximise opportunities arising from evolving legislation in relation to diversity and inclusion.

Property Platform

This remains our largest, most diverse, and most mature Platform. Against the backdrop of challenging market conditions in UK commercial and residential real estate, we are pleased to report revenue growth of 12.4% on this Platform.

In legal services, our contentious construction team and real estate dispute resolutions team are both counter-cyclical in nature and generated revenue growth of 33.0% and 21.1% respectively from both stand-alone mandates and in working with specialist teams on this and other Platforms. The pipeline for both teams remain strong.

Our residential development team is likely out-performing the market in delivering revenue growth of 8.2%. This is testament to the team's market-leading position.

The commercial real estate market remains subdued, and this team's revenue contracted by 23.7% versus a more active market in H1 23. The short-term outlook here remains uncertain. Anticipated cuts in interest rates may stimulate the market but a number of related billing points could be beyond full year.

Taken as a whole, consultancy business revenue on this Platform has grown organically by 25.1% with particularly encouraging H1 performances by Gateley Capitus (GC), Gateley Vinden (GV) and Gateley Smithers Purslow (GSP), now supplemented by the in-Period acquisition of RJA, the seventh consulting business to be acquired onto this Platform. RJA specialises in the provision of quantity surveying and project management services to organisations in the affordable housing sector. It also has expertise to support those teams in GV and GSP, who provide specialist advice to UK property insurers in relation to major loss claims, a busy and economically agnostic market. RJA has integrated well during H1 24 and is delivering in-line with pre-acquisition expectations.

Operational review

Our operational focus has been aimed at current and future efficiency.

AI is towards the top of the agenda in most businesses. We are very aware that ultimately, properly procured and adopted, AI will positively transform the delivery of professional services. We started investing in technology to enhance efficiencies some time ago. We now have an internal steering group assessing new products, our own product development and anticipated evolution in AI against opportunities across the Group to enhance service delivery and/or realise operational efficiencies. We believe that we are making good progress and we are forming views on requisite resource and investment to plan into FY 25 and beyond.

In Period, we acquired new systems to support the on-boarding of a legal services team to run class action claims. This is specialist, long-term, high value work which requires a bespoke technology platform, in which we have invested.

We have previously reported planned rationalisation of some of our office space. This is an on-going exercise, including the post-Period surrender of our lease for office space in Leicester as part of consolidation of some of our teams in the East Midlands to our Nottingham office.

On-going integration of recently acquired businesses is proceeding as planned, including positive enhancements to our Group integration processes. In parallel, phase two of adoption of our new, market-leading business management, productivity, and financial management system (3E) is proceeding throughout FY 24 and into FY 25.

The Board

Further to the announcement in September 2023 that Nigel Payne will step down as Chairman at the 2024 AGM in September, we have announced separately today that David Wilton will join the board as Chair Designate and Non-Executive Director on 1 February 2024. I am very much looking forward to working with David and, on behalf of everyone at Gateley, extend a warm welcome to him.

Responsible Business

Being a Responsible Business remains an integral part of our Purpose Statement;

We were delighted to achieve all 15 of our internally set responsible business targets in 2022/2023 and, in-Period, we published our third annual Responsible Business Report outlining actions taken and setting targets for 2023/2024.

Highlights from the report include:

• A carbon reduction plan including a commitment to achieve net zero emissions by 2040, with interim targets set by 2030;
• A new strategic partnership with Alzheimer's Research UK; and
• The launch of an internal volunteering policy which provides opportunities for our people to volunteer with the charity, sustainability and education partners we work with.

Current trading and outlook

Our H1 performance was solid despite an ongoing difficult macro-economic environment.

As we said in our FY 23 announcement last September, our expectation was that in transactional legal services trading conditions would improve in H2 24. However, despite a stronger Q2, market conditions remain challenging and look likely to continue for longer than anticipated. Whilst non-transactional activity continues to strengthen to mitigate the impact and consultancy services activity remains robust, overall uncertain and shifting patterns of demand lead us to adopt a cautious approach in our outlook, which means that results for the full year are expected to be broadly in-line with market consensus. However, the underlying strength of our unique, diversified business model and balance sheet, when put alongside traditional long-term drivers that underpin demand for quality professional services, ensure that we remain well-placed to continue our track record of growth and realise our long-term ambitions.

In the meantime, our focus for the remainder of the year remains firmly on the basics of business and the maximisation of revenue and profit opportunities.

Rod Waldie

CEO

CHIEF FINANCIAL OFFICER'S REVIEW

Financial overview

I'm pleased to report a resilient financial performance during the first half of this year in which both revenue and profit growth was good considering the ongoing economic stagnation in trading conditions for many sectors across the UK economy.

We have made further selective medium to long term strategic investments across our Platforms that continue our existing journey to wider diversification in both legal and consultancy service delivery.

Activity levels at the beginning of the Period were in line with where FY 23 finished, however despite increases in activity during Q2, Q3 is so far lower than expected. Whilst transactional services remain subdued due to economic conditions, delivery of contentious services continues to increase. This is a by-product of our diversification in service lines and long-term underlying strategy. Financing this transition towards increased contentious services, requires cost investment in the near term, but will ultimately enhance profitability in the medium to longer term. Contentious services continue to grow as a mix of overall services and now represent 36.7% (H1 23: 30.6%) of Group revenue. They are counter cyclical and less volatile than transactional services during a period of changing market conditions. However, they inherently also take longer to convert into fees and cash.

During the Period inflation has started to reduce and interest rates appear to have peaked which are assisting forecasting of costs going forward, however these economic conditions are not yet providing the stimulus for a change in non-contentious services activity levels with any confidence.

Revenue

Group revenue grew by 7.6% to £82.0m for the first half of the year, from £76.1m in H1 23. Revenue growth in the Group's core legal services was entirely organic at 2.4%, growing to £59.3m (H1 23 £57.9m), whilst revenue from consultancy services grew by 24.1% overall to £22.6m (H1 23 £18.2m). Acquired consultancy revenue totalled £2.3m following the acquisitions of Symbiosis IP and RJA, (H1 23: £0.2m) during the Period, with organic consultancy revenue growth of 13.5% to £20.5m (H1 23: £18.0m).

The Group has grown two of its four Platforms, and was broadly flat in the People Platform, during the Period with significant contributions made by the Property and Business Services Platforms and expanding and diversified service offerings. Restructuring and Banking activity on the Corporate Platform have helped to counter a subdued corporate transactional performance leading to a revenue decrease of 5.9% (H1 23: increase 26.0%).

Total expenses

Personnel costs (excluding the IFRS 2 charge) have increased as a percentage of revenue to 63.4% (H1 23: 61.7%), despite experiencing lower wage inflation, as headcount increased from investments made in key senior lateral hires and the recruitment of additional people. Average numbers of legal and professional staff rose by 3.5% to 1,035 (H1 23: 1,000) as recruitment was directed towards consultancy services demonstrating significant demand during the Period such as that experienced by GSP. Support staff numbers also increased by 5.5% to 463 (H1 23: 431) as a result of acquisitions and the expansion of our business support teams.

Other operating expenses, excluding non-underlying items, increased to £18.2m (H1 23: £16.0m) as the effect of investment and additional costs of acquired entities made in the Period were absorbed. Overall, operating costs as a percentage of revenue have increased from 21.0% to 22.2%. Our use of agile working, the new business management system and extensive review of premises usage will generate further medium-term cost savings, where appropriate, without damaging the resources available to clients and staff. In particular, our new business management system will enhance centralised control, support operational efficiencies and drive a level of consistency across the processing of all client and Group data.

Profit before tax and earnings per share

Underlying adjusted profit before tax of £10.0m has increased by 4.6% from £9.6m in H1 23. The board is pleased with profit and trading margin performance despite the decreased margin from continued on-going investment decisions made. We enter the second half of the financial year having maintained fee earner headcount in counter cyclical work types in order to match the changing client activity patterns and in the knowledge that we have a resilient and diverse spectrum of service lines from which to increase market share.

Reported profit before tax increased by 16.8% to £7.4m (H1 23: £6.3m) as underlying operating profit before tax decreased by 14.9% to £8.6m (H1 23: £10.1m) but was offset by increases in net interest of £1.4m. Profit after tax of £6.1m increased by 32.0% from a restated £4.7m and basic earnings per share increased similarly by 29.5% to 4.83p (H1 23: restated 3.73p). Underlying diluted earnings per share increased by 4.1% to 6.40p (H1 23: 6.15p) after a full Period impact from new shares issued for acquisitions and after awards made under the Group's share option reward schemes.

As explained in our FY 23 annual accounts, certain figures highlighted in this RNS, have been restated to reflect a change of IFRS 3 accounting treatment for consideration paid on all relevant historical acquisitions.

Dividend

The board proposes an interim dividend of 3.3p (H1 23: 3.3p) per share. This dividend will be paid on 28 March 2024 to shareholders on the register at the close of business on 23 February 2024. The shares will go ex-dividend on 22 February 2024. This dividend has not been recognised as a liability in the interim accounts.

Net assets

The Group's net asset position has increased by £8.7m to £83.3m (H1 23: restated £74.6m) as total asset growth of £11.3m was funded through the £4.0m increase in non-current liabilities (primarily increased usage of our revolving credit facility) less the decrease in current liabilities of £1.5m.

Net cash and working capital

Period end net cash increased by £0.5m compared to a decrease of (£8.1m) in H1 23. Cash generation from operating activities reduced slightly to £0.3m (H1 23: £0.0m). Cash generation from financing activities increased to £3.3m (H1 23: £(0.2)m) due to bank interest rates driving net interest income and cash acquired through the acquisition of RJA, and net cash outflow from financing activities improved to £(2.5)m (H1 23: £(8.1)m) as the Group drew down an additional £7m from its RCF for the post Period end funding of contingent consideration in respect of GSP and the acquisition of RJA.

Free cash flows increased to £1.5m (H1 23: £(1.5)m) due to lower net working capital following a reduction in lock up since the end of FY 23 and the increase in interest income.

Management continues to focus on lock-up. Total lock-up increased from 159 to 163 days as a result of strong organic and acquired growth and the pivot to increased, longer in duration, contentious assignments. WIP days increased from 59 to 65 days as the Business Services Platform recognised higher contract asset values and debtor days decreased slightly from 100 to 98 days as the slowing of collections on the Corporate Platform was offset by improvements in collections from our three other Platforms.

Conclusion

Despite prolonged and ongoing market uncertainty the Group has produced further organic growth and sensibly controlled costs after a period of significant inflation, whilst at the same time continuing to invest in strategic opportunities. We retain significant facility headroom to support further growth and expansion.

Neil Smith

Chief Financial Officer

Gateley (Holdings) Plc

Consolidated income statement and other comprehensive income

For the 6 months ended 31 October 2023

Other comprehensive income

Items that are or may be reclassified subsequently to profit or loss

Foreign exchange translation differences

The results for the periods presented above are derived from continuing operations. There were no other items of comprehensive income to report.

Gateley (Holdings) Plc

Consolidated statement of financial position

at 31 October 2023

The following describes the nature and purpose of each reserve within equity:

Share premium - Amount subscribed for share capital in excess of nominal value together with gains and losses on sale of own shares.

Treasury reserve - Represents the repurchase of shares for future distribution by the Group's Employee Benefit Trust.

Gateley (Holdings) Plc

Notes

for the period ended 31 October 2023

Basis of preparation

These interim unaudited financial statements for the six months ended 31 October 2023 have been prepared in accordance with the accounting policies set out in the Annual Report and Financial statements of the Group for the year ended 30 April 2023 using the recognition and measurement principles of IFRS as applied under the Companies Act 2006 and the AIM rules.

The comparative figures for the financial year ended 30 April 2023 are not the company's statutory accounts for that financial year. Those accounts have been reported on by the company's auditor and delivered to the registrar of companies. The report of the auditor was unqualified, did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report, and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.

1.1 Accounting policies

Accounting policies remain unchanged from those accompanying the 30 April 2023 financial statements.

Non-underlying items

Non-underlying items are non-trading and or non-cash items disclosed separately in the Consolidated Income Statement where the quantum, nature or volatility of such items would otherwise distort the underlying trading performance of the Group. The following are included by the Group in its assessment of non-underlying items:

• Share based payment charges: such charges are treated as non-underlying as the gain realised on the options granted is settled in shares not cash and therefore does not impact the income statement. The IFRS 2 charge is taken to the income statement, these expenses are treated as non-underlying items as they are either non-cash or non-recurring in nature.
• Amortisation in respect of intangible fixed assets: these costs are treated as non-underlying as they are non-cash items.

The tax effect of the above is also included if considered significant.

Exceptional items

Exceptional items are one off transactions, unrelated to the underlying trading performance of the Group disclosed separately in the Consolidated Income Statement where the quantum, nature or volatility of such items would otherwise distort the underlying trading performance of the Group.

The following are included by the Group in its assessment of exceptional items:

• Impairment charges in respect of intangible fixed assets: these costs are treated as exceptional due to their one-off nature.
• Non-typical expenses associated with acquisitions.
• Costs incurred as part of significant refinancing activities.

The tax effect of the above is also included if considered significant.

Intangible assets and goodwill

Goodwill

Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to cash-generating units and is not amortised but is tested annually for impairment. In respect of equity accounted investees, the carrying amount of goodwill is included in the carrying amount of the investment in the investee.

Other intangible assets

Other intangible assets, including software licences, expenditure on internally generated goodwill, brands and software, customer contracts and relationships are capitalised at cost and amortised on a straight-line basis over their estimated useful economic lives through operating expenses.

Customer lists

Customer lists that are acquired by the Group as part of a business combination are stated at cost less accumulated amortisation and impairment losses (see accounting policy 'Impairment of assets'). Cost reflects management's judgement of the fair value of the individual intangible asset calculated by reference to the net present value of future benefits accruing to the Group from the utilisation of the asset, discounted at an appropriate discount rate.

Brand value

Certain acquisitions have retained their trading name due to the value of the brand in their specific marketplace.

Brand value is amortised over a period of three or five years based on the Directors' assessment of the future life of the brand, supported by trading history.

Critical accounting judgements and key sources of estimation uncertainty

The preparation of consolidated financial statements under IFRS requires management to make estimates and assumptions which affect the reported amount of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities. If in the future such estimates and assumptions, which are based on Management's best judgement at the date of preparation of the financial statements, deviate from actual circumstances, the original estimates and assumptions will be modified as appropriate in the period in which the circumstances change. The key areas where a higher degree of judgement or complexity arises, or where estimates and assumptions are significant to the consolidated financial statements are discussed below.

Management does not consider there to have been and critical accounting judgements made in the financial period.

Unbilled revenue on client assignments

The valuation of unbilled revenue (on non-contingent matters) involves detailed understanding of contractual terms with clients. The valuation is based on an estimate of the amount expected to be recoverable from clients on unbilled items based on such factors as time spent, the expertise and skills provided and the stage of completion of the assignment. The principal uncertainty over this estimation is a result of the amounts not yet being billed to, or recognised by the client. Provision is made for such factors as historical recoverability rates, agreements with clients, external expert's opinion and the potential credit risks, following interactions between legal staff, finance and clients. Where entitlement to revenue is certain it is recognised as recoverable selling price. Where a matter is contingent at the statement of financial position date, no revenue is recognised.

Valuation of intangibles

Measurement of intangible assets relating to acquisitions: In attributing value to intangible assets arising on acquisition, management has made certain assumptions in terms of cash flows attributable to intellectual property and customer relationships. The key assumptions made relate to the valuation of the brand, where the acquired brand is retained by the entity, and the customer list. The value of such intangibles has been estimated based on the amount of revenue expected to be generated by them. The revenue estimations rely on annual growth rates. Management have selected the appropriate rates based on a combination of observed historical growth, industry norms and forecasted influencing factors. Management have also performed sensitivity analysis to assess the impact of any variation to the growth rate used. The rates applied reflect previous growth rates, with sensitivities indicating that variations in the actual rate achieved are unlikely to materially impact the valuation of the intangible assets.

1.2 Alternative performance measures

Underlying profit before tax

The adjustment for share-based payments relates to the impact of the accounting standard for share-based compensation. The cost of all share-based schemes are settled entirely by the issue of shares where the proportions can vary from one year to another based on events outside of the businesses control e.g., share price. Under IFRS the anticipated future share cost is expensed to the income statement over the vesting period. The adjustment above addresses this by adding to profit the IFRS 2 charge in relation to outstanding share awards. This adjustment is made so that non-cash expenses are removed from profit.

Cash generated from operations

Free cash flows

1.3 Going concern

These interim accounts are prepared on a going concern basis as the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. The Group remains cash generative, with a strong on-going trading performance.

1.4 Statement of Directors' responsibilities

1.5 Cautionary statement

This document contains certain forward-looking statements in respect of the financial condition, results, operations and business of the Group. Whilst these statements are made in good faith based on information available at the time of approval, these statements and forecasts inherently involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause the actual results of developments to differ materially from those expressed or implied by these forward-looking statements and forecasts. Nothing in this document should be construed as a profit forecast.

Operating segments

The Chief Operating Decision Maker ("CODM") is the Strategic Board. The Group has the following strategic Platforms, which are its reportable segments. These divisions offer a mixture of legal and consultancy services to clients. With effect from 1 May 2022 all service lines are managed through four Platforms.

The Group has restated the segmental reporting for the comparative periods to reflect the current operating segments in place

The following summary describes the operations of each reportable segment as reported up to 31 October 2023:

.

6 months to 31 October 2023

Employees

The average number of persons employed by the Group during the period, analysed by category, was as follows:

Number of employees

The aggregate payroll costs of these persons were as follows:

Underlying earnings per share have been shown because the Directors consider that this provides valuable additional information about the underlying performance of the Group.

Dividends

The board intends to approve an interim dividend of 3.3p (H1 23: 3.3p) per share. This dividend will be paid on 28 March 2024 to shareholders on the register at the close of business on 23 February 2024. The shares will go ex-dividend on 22 February 2024. This dividend has not been recognised as a liability in these final statements.

7 Intangible assets

Acquisition of Richard Julian and Associates Limited (RJA)

On 19 July 2023 Gateley (Holdings) Plc acquired the entire issued share capital of Richard Julian and Associates Limited. RJA specialises in the provision of quantity surveying and project management services to organisations in the affordable housing sector.

The amounts recognised in respect of identifiable assets acquired and liabilities assumed are as set out in the table below:

A contingent consideration arrangement was entered into as part of the acquisition. A further £2.1 million could be payable with any payment subject to RJA achieving at least £4 million of revenue over the first 12 months post-acquisition, and not less than £5 million of revenue for the following 12 months. Such payment is to be split in shares and cash as agreed between the Sellers and the Company, providing no Seller is entitled to receive more than 50% of their total consideration in cash.

8 Contract Assets and liabilities

Contract assets

Contract assets consist of unbilled revenue in respect of professional services performed to date.

Contract assets in relation to non-contingent work are billed at appropriate intervals, normally on a monthly basis in arrears, in line with the performance of the services and engagement obligations. Where such matters remain unbilled at the period end the asset is valued on a contract-by-contract basis at its expected recoverable amount.

Contract assets in relation to contingent work are billed at a point in time once the uncertainty over the contingent event has been satisfied and all performance obligations satisfied, such that it is no longer contingent, these matters are valued based on the expected recoverable amount. Due to the complex nature of these matters, they can take a considerable time to be finalised therefore performance obligations may be settled in one period but the matter not billed until a later financial period. Until the performance obligations have been performed the Group does not recognise any contract asset value at the year end.

Contract liabilities

9 Trade and other receivables

10 Other interest-bearing loans and borrowings

The contractual terms of the Group's interest-bearing loans and borrowings, which are measured at amortised cost, are described below.

On 18 April 2022, the Company entered into a revolving credit facility which provides total committed funding of £30m until April 2025. Interest is payable at a margin of 1.95% above the SONIA reference rate.

11 Trade and other payables

12 Share based payments

Group

At the period end the Group has four share-based payment schemes in operation.

Long Term Incentive Plan ('LTIP')

Performance conditions

Restricted Share Award Plan ('RSA')

Save As You Earn Scheme (SAYE)

Company Share Option Plan (CSOP)

The Group operates a HMRC approved CSOP scheme for senior associates, legal directors, equivalent positions in Gateley Group subsidiary companies and senior management positions in our support teams. Options under this scheme will vest if the participant remains employed for the agreed vesting period of three years. Upon vesting, each option allows the holder to purchase the allocated ordinary share at the price on the date of the grant.

The annual awards granted under the schemes are summarised below:

During the period 703,522 CSOP options became eligible to exercise, with 438,263 being exercised by 31 October 2023.

During the period 48,559 SAYE 19/20 options were exercised.

On 21 September 727,790 LTIP options were exercised.

On 21 September 2023 790,131 Restricted Share Awards were granted.

Fair value calculations

RSA