PERSONAL GROUP HOLDINGS PLC

Annual Report • May 29, 2025

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The initiatives commenced over the last 18 months have provided a stronger platform on which to build, increasing the proportion of recurring revenue within the business, simplifying its structure and introducing increased operational rigour and integrity.” Martin Bennett Non-Executive Chair Read my statement | Page 8 Personal Group is a workforce benefits and health insurance provider Focused on improving employee health, wellbeing and engagement. Personal Group Holdings Plc | Annual Report and Accounts 2024 For the latest Investor relations: www.personalgroup.com/investors Overview 02 2024 Highlights 03 Our Business at a Glance 04 Our Ambition 05 How we will get there 06 Our Strategy 07 Why invest in Personal Group Governance 36 Corporate Governance 38 Board of Directors 40 Risk and Compliance Committee Report 42 Audit Committee Report 45 Remuneration Committee Report 51 Nominations Committee Report 53 Directors’ Report 54 Statement of Directors’ Responsibilities Strategic Report 08 Chair’s Statement 10 Our Business Model 11 Market Overview 12 Group Chief Executive’s Statement 15 Our Strategy in Action 19 Key Performance Indicators 21 Chief Financial Officer’s Statement 26 Risk Management 29 Environmental, Social and Governance 33 Section 172 Statement Financial Statements 55 Independent Auditor’s Report 63 Consolidated Income Statement 65 Consolidated Balance Sheet 67 Company Balance Sheet 68 Consolidated Statement of Changes in Equity 69 Company Statement of Changes in Equity 70 Consolidated Cash Flow Statement 72 Company Cash Flow Statement 73 Notes to the Financial Statements 106 Company Information Page 06 Our Strategy Page 10 Our Business Model Page 29 Environment, Social and Governance What’s inside Page 19 Key Performance Indicators Financial Statements 01 Governance Overview Strategic Report 2024 Highlights Financial Operational Non-financial Group Revenue £43.8m (2023: £38.6m) Another record year for insurance – and a record month in September, with new annualised insurance sales up 18% to £13.9m in the year. Significantly enhanced Benefits offering – completed the migration of the vast majority of customers onto Hapi 2.0, launched SEB 2.0 and completed the migration of customers onto the new platform. Simplified and streamlined the business – Disposal of Let’s Connect, enabling a greater focus on recurring revenue streams, and strengthening the balance sheet. High levels of customer retention – at over 80%, testament to the value provided. Won multiple industry awards – demonstrating the quality and competitive strength of the platform. 27 new Benefits clients won in the year – with value per win up 10% year-on-year. Reorganised and strengthened team – including key strategic hires of Chief Operations Officer, and also Chief Sales Officer and Chief Commercial Officer post- period end. Strengthened relationship with Sage – with best-ever month of leads in November and December. Basic EPS 17.7p (2023: 13.4p) Adjusted EBITDA £10.0m (2023: £7.8m) Dividend Per Share 16.5p (2023: 11.7p) Profit before tax £6.8m (2023: £5.1m) Cash & Deposits £27.4m (2023: £20.1m) No. of Insurance Payers 100,823 (2023: 97,327) Total Client Number 4,834 (2023: 4,310) Strong performance On track with our ambitions. * Restated to reflect continuing operations following the disposal of Let’s Connect in July 2024. 02 Personal Group Holdings Plc | Annual Report and Accounts 2024 Insurance Benefits and Reward Affordable Insurance On weekly or monthly rolling contracts Benefits Platform Delivered to employers directly and through channel partners Pay & Reward Consultancy and software solutions Insurance Hospital plan, recovery plan, and death benefit policies, underwritten by Group subsidiaries. Our easy to understand, affordable plans are secured for the lifetime of the policy, providing peace of mind for diverse workforces from across society. Hapi Hapi is our technology platform that powers growth through enhanced connectivity, engagement, health and wellbeing. Sage Employee Benefits Our tailored engagement product designed for the SME market. Innecto We offer strategic consultancy on pay and reward and a suite of cloud-based SaaS solutions and surveys. Clients can tailor their solution with our experts to help them define and implement fair, consistent reward programmes that align to their business strategy and workforce. Annualised Premium Income £36.0m (2023: £31.6m) Read about The CEA (Case Study) | Page 16 Read about Our Business Model | Page 10 Benefit Platform ARR £6.7m (2023: £6.1m) Pay & Reward ARR £0.71m (2023: £0.67m) Read about Royal Mail (Case Study) | Page 15 Our Business at a Glance Personal Group provides benefits and insurance services focused on improving employee health, wellbeing and engagement. Our vision is to be the champion of affordable benefits, keeping businesses and their employees happy, healthy and protected. Helping employees thrive In work and in life. 03 Financial Statements Governance Strategic Report Overview Our Ambition • Access to 300k new employees • Premium income >£70m • 10% of EBITDA from new insurance products and channels • Double our client base • 10 additional partnerships • 8,000 leads per annum across partners How we are going to get there Find our more about insurance | Page 10 Find our more about benefits | Page 10 Discover more about our strategy | Page 6 Clarity of ambition Focused on our 2030 aspirations. Insurance Benefits and Reward >£100m Revenues £30m EBITDA >£20m SaaS ARR 04 Personal Group Holdings Plc | Annual Report and Accounts 2024 Geared up to deliver A clear pathway to meet our 2030 aspirations. To >£100m Revenues Accelerate Pursuit of select acquisitions that provide additional products or expertise to accelerate growth. Find our more about acquisitions | Page 6 How we will get there Expansion Growth in existing insurance book through increased customer penetration and expanded market reach. Adoption Growth of Benefits and Reward through expansion of the Hapi platform, increased upsell to Insurance customers and greater digital integration of the two offerings. Innovation Expansion of the Insurance offering into new products and channels. Partnering Growth of Benefits & Reward via partnerships. Affordable Insurance Benefits & Rewards from £43.8m Revenues Financial Statements 05 Governance Overview Strategic Report A clear strategy To capture a significant market opportunity. Adoption Expansion of the Hapi platform, increased upsell to Insurance customers and greater digital integration of the two offerings Accelerate Pursuit of select acquisitions that provide additional products or expertise to accelerate growth Innovation Expansion of the Insurance offering into new products and channels Expansion Growth in existing insurance book through increased customer penetration and extended market reach Partnering Growth of Benefits & Reward via partnerships Affordable Insurance Benefits & Reward M&A Our Strategy Our winning aspiration is to be the champion of affordable and accessible insurance and benefits, keeping businesses and their employees happy, healthy and protected. Strong delivery against our initiatives in FY24: Progress in FY24: • A second successive record new insurance sales of £13.9m • Strong YOY retention rate of 81.8% • Growth in API to £36.0m • Claims ratio of 29.1% • Atalian and Europa Worldwide Group new customer wins FY25 initiatives & priorities: • Improve penetration of new employees in our top 100 accounts • Simplify digital SME offering KPIs we will track: • No. of available employees for face to face insurance • No. of insurance payers • API in Force £m Progress in FY24: • Nearing completion on the development of our new employer paid cash plans • Kicking off project to redesign and redevelop our insurance system infrastructure FY25 initiatives & priorities: • Broaden insurance products and channels • Leverage potential partnerships (white label/brokers) KPIs we will track: • EBITDA from new insurance products & channels Progress in FY24: • Growth in ARR to £7.4m • Successful migration of customers onto Hapi 2.0 • Office of National Statistics, DHU Healthcare and Karbon Homes new client wins • Major Pay & Reward 3-year contract signed with BA FY25 initiatives & priorities: • Simplified tiered offering for Hapi • Upsell new benefit modules, including R&R and Transform • New careers pathways tool KPIs we will track: • SaaS ARR • No. of Hapi clients Progress in FY24: • SME clients with Sage increased to 4,436 in 2024 • Gross transactional value through the platform up 8.9% to £59.7m FY25 initiatives & priorities: • Increase partners to target SME • Monetise eCommerce partnerships KPIs we will track: • No of Hapi/SME partners • Leads obtained via partnerships Approach to M&A: With significant liquid funds available to the Group, there remains an appetite for strategic growth through acquisition. Acquisition targets would be considered provided they conformed with the Group strategic objectives namely; • Profit generative • Recurring Revenues • Operating in target markets • Vertical alignment of product 06 Personal Group Holdings Plc | Annual Report and Accounts 2024 Why invest in Personal Group Right offering for today’s world The world of work is changing, and our offerings are needed now more than ever. Employers are more aware and determined to support the wellbeing of their employees, to help retain and incentivise their workforce. Meanwhile, the ongoing cost-of-living crisis, increased sick leave and long NHS waiting lists are putting considerable pressure on UK businesses and their employees; our offering can help mitigate these challenges. Our market research has shown there are approximately 10m employees in the UK without or with partial short-term sick pay support, and 74% of SMEs in the UK believe they need to expand their Benefits offerings. Unique sales proposition with high levels of brand awareness Our market review identified that we are the only affordable insurance offering delivered via a face-to-face sales model, and that this is the sales method that is most effective in our target markets. It also identified that our brand is well known and liked, providing a fantastic basis to grow our already extensive customer base. We are now focused on introducing initiatives to increase our sales effectiveness and expand our reach through further partnerships. Strengthened organisation with a clear strategy The investments we are making in expanding our offerings, simplifying our teams and structures, and streamlining our organisation mean we are a stronger business, better positioned to capture the significant opportunity in our large, growing and underpenetrated market. We have set clear ambitions for the business and are focused on strategic execution. Strong financial position We have achieved strong growth in profitability, driven by record new insurance sales and new client wins. We have seen recurring revenue streams grow in 2024 by 12.6% to over £40m. This high level of revenue visibility means we can be confident in our continued growth. We are profitable, cash generative, debt free with a strong balance sheet and a progressive dividend policy. Year on year insurance retention 81.8% Hapi Net Retention Rate 91% Increase in total client numbers 12.2% to 4,834 Savings delivered to client employees £2.9m ARR for SaaS licenses £7.4m Dividend per share 16.5p 2030 Aspirations Revenues >£100m EBITDA to £30m SaaS ARR >£20m A strong, profitable business with a unique offering and a clear strategy To capture the significant market opportunity. See our Market Overview | Page 11 See Our Business at a Glance | Page 3 Read about Our Strategy | Page 6 See CFO Statement | Page 21 Financial Statements 07 Governance Overview Strategic Report “The successes of 2024 mean we have entered 2025 with real momentum.” Martin Bennett Non-Executive Chair 2024 was a year of excellent progress for Personal Group Delivering growth while completing a comprehensive overhaul of the Group’s strategy and operations. Chair’s Statement The strategic initiatives that have been implemented over the last 18 months have provided a stronger platform on which to build, increasing the proportion of recurring revenue within the business, simplifying its structure and introducing increased operational rigour and integrity. As a result, the business has entered 2025 with real momentum. The relevance of the Group’s Affordable Insurance and Benefits & Rewards offerings to our customers and their employees can be seen in the growth of our customer base and high retention levels. We have seen several record insurance sales months again this year and are confident that we have room to improve upon these results further still, through continuing to refine our sales approach, expanding our product offering and engaging with additional partners. Cash and deposits £27.4m (2023: £20.1m) Dividend per share 16.5p (2023: 11.7p) Group Revenue £43.8m (2023: £38.6m) 08 Personal Group Holdings Plc | Annual Report and Accounts 2024 The investment in our senior leadership team, including key strategic hires of Chief Operations Officer, Chief Sales Officer and Chief Commercial Officer, means we now have strength and depth across the organisation, and it is pleasing to see the newly formed team united by a common conviction in the growth strategy, the creation of which was a key priority for the Board. I would like to thank the entire team for their continued dedication to supporting our customers, while delivering these strong results. Their passion for what we do is evident in the high level of customer service across the organisation, and it is their dedication and commitment that makes Personal Group the strong organisation that it is. Strategic execution delivering strong performance We have successfully delivered across our KPIs once again this year, achieving double- digit revenue growth from continuing operations of £43.8m (2023: £38.6m) and EBITDA growth of 29% at £10.0m (2023: £7.8m). We continue to benefit from a strong balance sheet, generating cash from operations in the year of £11.4m, increasing our cash and bank deposits position to £27.4m as at 31 December 2024 (2023: £20.1m) with no debt. Importantly, following the disposal of Let’s Connect, recurring revenues continued to increase, now represent 92% of total Group revenue from continuing operations (2023: 93%). Our Affordable Insurance division and successful face-to-face sales approach continues to be a major asset of the business, once again delivering a record performance, driven by record new sales and high retention rates. Benefits platform revenue has also continued to grow, delivering increased levels of annual recurring revenue (“ARR”) and with the migration of customers to the second generation of the platform now all but complete, the future for this division looks promising. The contribution from Pay & Reward increased this year, supported by a significant contract win with British Airways, and the division has developed innovative digital offerings which we are now looking to roll out further. ESG Personal Group is a business very much guided by its purpose, and the Board remains committed to maintaining high standards of ESG, ensuring we build a strong business in a responsible way. We continue to reduce the Group’s already low carbon footprint, while fostering an inclusive, progressive and diverse working environment. Our ESG metrics were incorporated into our Group bonus scheme for the first time this year, and we are delighted that all targets were achieved. Dividend I am pleased to announce that the Board has recommended a final ordinary dividend of 10.0 pence per share which will be paid on 14 May 2025 to members on the register as at 4 April 2025 (the record date). Shares will be marked ex-dividend on 3 April 2025. This makes a total ordinary dividend for 2024 of 16.5 pence per share, representing an increase of 41% year on year (2023: 11.7p). Increased profitability across the growing business in the second half of the year as well as the net cash inflow and realisation of working capital resulting from the disposal of Let’s Connect has resulted in the cash balances of the Group being significantly increased and this enhanced cash position is reflected in an increased dividend to shareholders. While the disposal of Let’s Connect has contributed to this year’s enhanced return, our policy remains to grow the dividend progressively in line with earnings and cash flow generation. Confident Outlook The successes of 2024 have continued into 2025 and we see real momentum across the business. Personal Group’s high levels of recurring revenue provide high levels of visibility, and strong cash generation give the Board considerable confidence. We will continue to invest in our people and offerings to ensure we capture the significant opportunity ahead, and in doing so deliver increasing returns for our shareholders. Martin Bennett Non-Executive Chair 25 March 2025 Business Awards Won Our commitment to delivering exceptional customer service, upholding consumer duty, and investing in technology with Hapi is yielding positive results, as evidenced by our recent award successes. 09 Financial Statements Overview Strategic Report Governance Our Business Model We are a workforce benefits and health insurance provider We exist to help businesses positively impact the happiness, health and protection of their employees. Value created Key inputs People We have a focused, energised and determined team, comprising experts in insurance, benefits and software development. We are led by an experienced Board, carefully selected to ensure a varied set of skills and experiences. Products Our affordable and accessible insurance offerings include hospital, recovery and death benefit plans. They are sold via a unique face-to-face sales model. Our award-winning employee benefits platform, Hapi, brings together extensive employee benefits, discounts and rewards in one responsive platform. We offer pay and reward consultancy services and cloud-based SaaS solutions and surveys. Brand Over our 40 years in the industry, we have built a strong brand and reputation. Partners We have a growing pool of powerful partners, such as Sage, who provide us with access to additional areas of the market. Financial strength We are profitable and cash generative, with double digit growth across all areas of the business and a high and growing proportion recurring revenues. What we do Affordable insurance Employee-paid insurance plans – access to our insurance products is made available through an individual’s wider employee benefits offering. Premiums are paid by the employee via a weekly or monthly payroll deduction. The premiums are recognised as insurance revenue and provide high levels of recurring revenue, with low levels of churn. Benefits & Reward SaaS Benefits Platform Our benefits offerings are sold direct to employers via the Hapi platform, contributing SaaS revenue. The offerings can be white-labelled through a corporate partner, e.g. Sage Employee Benefits. Alongside SaaS revenue, we generate Commission on third party transactions – we earn a margin on some of the discounted vouchers available to employees through Hapi and commission on any employer purchases of third-party products or solutions. Pay & Reward Consultancy income Employers pay for a full reward service – from pay benchmarking and surveys to the development of job evaluation and bonus schemes. Innecto Digital subscriptions Employers pay an annual subscription for digital analysis and predictive SaaS tools for use in making pay decisions. Customers We enable organisations to stand out as an employer of choice, retaining and rewarding their workforce. Insurance payers increased to 100,823 Total clients increased to 4,834 Colleagues We are a business focused on people, starting with our own. We foster strong teams and invest in continuous training and development, as well as provide best-in-class employee benefits. >7,000 hrs hours of learning completed via our Continuous Professional Development programme. Society The simplicity and low cost of our insurance offerings means they are affordable for all workers, providing vital financial protection, which is so important in these challenging economic times. Our benefits offering helps employees cope with the cost of living crisis and feel recognised and rewarded in the workplace. Visit the ESG section of this report to learn more on how we are contributing to a better society and planet | Page 29 >£2m donated to charitable causes since PACT was founded in 1993. Shareholders We are a profitable business delivering double digit revenue growth, and we have a clear strategy in place to drive further growth and increase shareholder returns. Read more in the CFO Report | Page 21 Revenue up 13% EBITDA up 29% Dividend increase 15% 10 Personal Group Holdings Plc | Annual Report and Accounts 2024 Market Overview Geared up To encapsulate future markets. Our aspiration is to be the champion of affordable and accessible insurance and benefits, keeping businesses and their employees happy, healthy and protected. Never has this been more important. The ongoing cost-of-living pressures, increased sick leave and long NHS waiting lists are putting considerable pressure on UK businesses and their employees; we are focused on providing them with the offerings they need to mitigate these challenges. Some of the key market metrics identified by CIL’s market research in 2024 has been set out below. Our opportunity Growing market need See our Royal Mail (Case Study) | Page 15 Insurance • Big space to play for – 9.8m UK employees with no/little sick pay • 90%+ Enterprises want f2f engagement, 70% of SMEs want to invest in insurance • Our penetration is low – we cover 12% of companies; within which we have penetration c. 12% of the available employee base See our The CEA (Case Study) | Page 16 Benefits & Rewards • Large global market, growing at 4.5% CAGR to 2030 • In the UK, 20-40% of mid-Enterprise clients would switch platform • 53% of UK SMEs have no Benefits platform • 74% of UK SMEs believe they need to expand their Benefits See our Investment Case | Page 7 Our strengths • Only provider that offers face-to- face Insurance sales engagement • Award winning Benefits platform with the most comprehensive range of rewards • Powerful partnerships provide ability to target the significant SME market, at scale Employers • Increased national insurance and business rates • Reduced ability to increase pay as manner of retention • Higher labour standards Employees • Cost-of-living crisis and pricing pressures • Increased awareness of impact of poor health on financial wellbeing • Increased employee expectations around well-being support Financial Statements Overview 11 Strategic Report Governance “I’m excited about what lies ahead and confident in achieving our ambition.” Paula Constant Chief Executive Group Chief Executive’s Statement Strong financial and operational progress Underpinned by a clear strategy and growth opportunities. I am excited to report on another strong financial performance by Personal Group, in my first full year as CEO, with double digit revenue growth across all divisions. In addition, we have thoroughly underpinned our strategy and have started implementing what is required for accelerated growth in future years. We have delivered another record year in Insurance sales, supported by our unique face-to-face sales model, increasing efficiency and effectiveness through forensic operational management and strong team engagement. We have also secured notable new client wins, including DHU Healthcare and Freshpak, and maintained high levels of customer retention across all our offerings, resulting in strong growth in our recurring revenues, providing high levels of visibility and strong cash generation. As importantly, we have significantly shortened our time to process claims and handle queries, with exemplary customer review scores and have been recognised for our dedicated approach to vulnerable customer treatments. It is clear that we offer solutions which resolutely address customer needs, with exceptional customer support. New client wins across the group 81 (2023: 97) Annualised new business premium £13.9m (2023: £11.8m) SaaS annual recurring revenue £7.4m (2023: £6.7m) 12 Personal Group Holdings Plc | Annual Report and Accounts 2024 Much work has been undertaken to strengthen and streamline the business and we have exited the year with a leaner, more capable organisation geared for further growth and ready to execute on our strategy. The successful migration of customers onto the next generation of our Benefits platform, Hapi 2.0, provides a basis for greater Benefits adoption and expansion. We have reorganised and strengthened our team, including the key strategic hires of a new Chief Operations Officer and, more recently, a Chief Sales Officer for new and existing business and a Chief Commercial Officer to grow our product portfolio and optimise our profitability. Considerable progress has been made in enhancing our data insight, risk frameworks, contract management and security to create a more robust business on which to build. United behind a clear and ambitious strategy Crucially, the Group is now united behind clarity of ambition supported by a clear strategy, with KPIs to track progress. This strategy is informed by the extensive market research undertaken in my first year as CEO, which highlighted the strength of the Group’s market positioning and key areas of opportunity. Our strategy has four key pillars: Expansion, Innovation, Adoption and Partnering. Insurance growth will be driven by expanding within customer accounts and deepening our addressable employee base, alongside winning new clients directly and through partnerships, and expanding our insurance offering into new products and channels. Growth in Benefits & Rewards will come from the increased adoption of the Hapi platform across our Insurance customer base and expansion of our market reach, predominantly through partnerships. Our ambition is to exit 2030 having delivered in excess of £100m revenues, group EBITDA of £30m and recurring revenues of £20m and we are confident in our ability to achieve this organically. That said, our strong balance sheet and excellent cash generation also enables us to consider complementary acquisitions that would provide additional products or expertise and accelerate growth. We are continuing to explore potential M&A activity and we remain open to acquisition opportunities that meet our criteria and we see to be strengthening to the existing business divisions. Sales and Operational Review The Group made strong progress across both our Affordable Insurance and Benefits & Rewards divisions, enhancing and expanding our product offerings and growing our reach through partners. Affordable Insurance The Group delivered another record year in Insurance sales, including another record month in September, with new annualised insurance sales increasing by 18% in the year to £13.9m. We are proud to have increased both productivity and quality through our forensic analysis of team activity and management in addition to a laser focus on the early cancellations, which reduced by 10% year-on-year. Claims levels increased year on year, as anticipated, to £8.5m (2023: £6.9m). Customer retention levels remained high at over 80% year-on-year, testament to the value provided. We have invested huge efforts in improving customer service, achieving a Trustpilot score of 4.9, which we believe to be outstanding in our industry. In addition, claims processes have improved throughout the year, with the business processing more than 95% claims within 48 hours in Q4 with this standard expected to be maintained going forward. Given this strong performance, Insurance Annualised Premium Income increased 14% to £36.0m (2023: £31.6m). 2025 Insurance objectives We are focused on increasing our penetration of new employees, particularly within our top 100 accounts, which we are dissecting in terms of visit frequency and attendance by skill. Further opportunities to improve penetration include expanding our offering into new, adjacent products associated with ‘protection’ and increasing our routes to market through partnerships. We have identified our Group Cash plan and digital insurance options as the first two potential avenues to thoroughly test in 2025. Benefits & Rewards The Group’s digital benefits platform, Hapi, directly and via our SME-focused partnership with Sage, performed well and secured new clients, delivering ARR growth by 10% to £6.7m (2023: £6.1m). We improved customer churn by over 20% by further digitising processes and handoffs. Hapi’s performance was steady in the year, delivering ARR of £2.7m (2023: £2.5m), underpinned by 27 new Benefits clients won in 2024, comparable to the previous year, up 10% in average value per win year on year. Notable new client wins for Hapi include the Office of National Statistics, DHU Healthcare and Karbon Homes. We won a number of industry awards in the year, including Best Use of Technology in the 2024 Health and Wellbeing Awards, and Best Use of Technology in Benefits in the 2024 Workplace Savings & Benefits Awards, demonstrating the competitive strength of our platform. These, alongside the increased uptake of our Benefits offerings and Hapi’s top class Trustpilot score of 4.3, are evidence of the quality of our offering. A significant area of focus for the team in 2024 was the migration of customers onto Hapi 2.0, our next generation platform. We are delighted at the pace and the effectiveness of our migration, with the vast majority of customers (99.9%) now on the new platform. Customer feedback has been excellent, with the enhanced platform providing improved user navigation and personalisation, the reward and recognition features being strongly embraced, and the self-serve capability providing better flexibility. As importantly, consolidating code from the two platforms into one significantly reduces our operating costs into 2025. 13 Financial Statements Overview Strategic Report Governance Group Chief Executive’s Statement continued During the year we also launched SEB 2.0 (Sage Employee Benefits), based on Hapi 2.0, and migrated all Sage customers to the next generation platform within weeks. The Group also strengthened its relationship with Sage in the year and had its best-ever month of leads in November and December, providing a strong position from which to expand into new segments and geographies in 2025. The Group’s Pay & Reward division, comprising Innecto and QCG, now consolidated as one operating group under the Innecto brand, performed well, with ARR increasing to £0.71m (2023: £0.67m). This was largely due to the significant three-year contract with British Airways signed in the first quarter, worth £650,000, contributing approximately £100,000 per annum in ARR. The contract includes reward consultancy, the implementation of Innecto’s job evaluation tool and the development of a career pathway interface, which is expected to launch in 2025. The consultancy services and subsequent SaaS tools continue to serve an important strategic function. 2025 Benefits & Rewards objectives Now that the migration onto the new platform is nearly complete, the Group has the capabilities and bandwidth to focus on accelerating growth in Benefits. We are progressing various initiatives to upsell our benefits modules to Insurance customers, including Reward and Recognition (R&R) and Transform, our wellbeing health and fitness module, and are implementing greater digital integration of our Insurance and Benefits offerings to reduce friction in the sales process. Additionally, an important avenue for growth is via partnerships, and we are focused on increasing our leads across partners, progressing additional partnerships to target the SME market and monetising our eCommerce partnerships. We are pleased to have agreed a new consultancy partnership early in 2025, which has opportunity to and interest in expanding to benefits platform sales later in the year. Within our Pay & Reward division, our priority is the completion of an industrialised tool for Innecto and the launch of the British Airways career pathways tool. Passionate about our Purpose At Personal Group, our Purpose is at our core: to keep businesses and their employees happy, healthy and protected. This includes supporting our own employees and, to that end, we have implemented 11 new employment policies, placing us ahead of other businesses our size. To cement adherence to our ESG targets across the organisation, we have established a new Bonus Gateway to make our ESG metrics and targets a more meaningful part of remuneration for all employees, removing their inclusion from any LTIP portion. We are pleased to have achieved progress on every dimension of ESG in 2024. Outside of the organisation, Personal Group is committed to ensuring our customers are cared for above and beyond the FCA’s Consumer Duty regulations, and we have established an internal working group to deliver these requirements. Our endeavours were recognised in the year when we were awarded the Vulnerable Consumer Duty award in the inaugural Consumer Duty awards. Serving our communities is also integral to Personal Group’s ethos, and in the year we focused our Personal Assurance Charitable Trust donations, for which we pledge at least 1% of EBITDA or a minimum of £100k each year, on charities within three main areas: employee charity of choice, customers and policy holders, and the local community. We also launched a new Volunteering Policy which is participated in across all levels of the organisation. Outlook Personal Group has entered 2025 a stronger, simpler business with a clear strategy in place to accelerate growth and capture the significant market opportunity. We will build on our momentum by further refining our sales processes and expanding through product innovation and new routes to market. The Group continues to benefit from a strong balance sheet and high levels of recurring revenues, providing confidence in continued growth. Paula Constant Chief Executive 25 March 2025 Dynamic new leadership Hywel Phillips, Chief Operating Officer Hywel joins as COO after leading BT’s fibre rollout and driving transformation across Openreach. Known for his strategic focus and inspirational leadership, he brings vast experience in sales and service innovation. Arianne Riddell, Chief Sales Officer Arianne Riddell joins as CSO bringing leadership experience from Feefo, LinkedIn, and JCDecaux. Her expertise in growth, client engagement, and commercial transformation will be instrumental to our success. Helen Tinnelly, Chief Commercial Officer Helen Tinnelly joins as CCO in February, bringing 20+ years of leadership in strategy, product development, and transformation. Her expertise will be instrumental in driving growth and innovation across our business. 14 Personal Group Holdings Plc | Annual Report and Accounts 2024 Our Strategy in Action The Personal Group Solution For over 40 years, Personal Group has provided employee-paid insurance plans as part of comprehensive employee benefits packages. These plans ensure that RMG employees and their families are supported when it matters most—whether covering time off for hospital appointments, aiding recovery, or offering security during challenging times. With fast claim processing, these plans are highly valued by employees. RMG first partnered with Personal Group in 1990, with 1,000 policies purchased in the initial year. Since then, uptake has grown significantly, and by 2024, 17% of eligible RMG employees now hold a Personal Group policy. Royal Mail Group Sector: Postal Employees: > 150k Growing Insurance by expanding within existing customers The increased uptake of our insurance plans amongst Royal Mail employees is testament to the value delivered by our offering to customers and their employees and also the success of our face-to- face sales technique in driving sales across our existing customer base. Challenge Continuous engagement and employee wellbeing Royal Mail Group (RMG) is a cherished UK institution connecting communities and businesses. With its iconic red branding and 1,200 delivery offices nationwide, RMG delivers billions of parcels and letters annually. RMG values its 150,000 workforce and recognises the significant benefits insurance brings to their lives. Affordable Insurance – Expansion Outcome To promote uptake, Personal Group’s Employee Engagement Executives (EEEs) visit all 1,200 RMG delivery offices twice a year. In 2024, the team delivered 47,299 face-to-face presentations—a 7.5% increase from the previous year—leading to a 23% rise in enrolments. Premiums are conveniently paid via weekly or monthly payroll deductions, with approximately 24,000 Royal Mail employees now holding a Personal Group insurance plan. How is Personal Group helping transform wellbeing and benefits? “Our team is dedicated to supporting Royal Mail employees across their vast network. By covering all shifts during our visits, we ensure every employee has the opportunity to engage with us. This has been met with overwhelmingly positive feedback. Clearly explaining the benefits available through ‘My Bundle’ helps improve understanding, boost morale, and give employees the chance to ask important questions in person. We’re proud to support Royal Mail’s workforce and sincerely appreciate the warm reception from the teams we visit.” Hywel Phillips Chief Operating Officer at Personal Group Financial Statements Overview 15 Strategic Report Governance Our strategic partnership approach Through strategic partnerships, we deliver game-changing wellbeing and benefits solutions that help businesses tackle skills shortages, boost retention, and keep talent engaged. By joining forces with the CEA, we’re driving a stronger, more resilient manufacturing industry. The Personal Group Solution This collaboration was developed in response to discussions with CEA members, addressing the skills shortages and recruitment challenges highlighted in the CEA Manifesto. Investing in employee wellbeing can enhance retention, reduce turnover, and lower training costs. According to research from Oxford University, happy employees are 13% more productive, demonstrating the value of wellbeing initiatives. A survey gathering responses from CEA member companies provided valuable insights that led to the establishment of this partnership. The key findings from the survey show that 64% of respondents struggle to recruit talent, while 36% struggle to retain top talent. An unsurprising, 73% indicated that their ability to match salary trends has been affected by the cost-of-living crisis. Outcome “This partnership strengthens the CEA’s member benefits, enabling businesses to enhance their employee value proposition. Construction Equipment Association Members: 142 organisations Headquarters: London Challenge Personal Group Partners with the CEA to Strengthen Employee Wellbeing In 2024, Personal Group formed a strategic partnership with the Construction Equipment Association (CEA) to launch a new suite of member benefits. The CEA, the UK’s trade association for construction equipment manufacturers, represents leading OEMs such as JCB, Caterpillar, and Merlo, along with hundreds of supply chain organisations. Benefits & Rewards – Adoption Hapi helps employees manage their finances, easing wage pressures while supporting their overall wellbeing. In a predominantly male workforce, mental health is a key concern, often impacting productivity and increasing sick leave. Through this initiative, we support CEA members in attracting, retaining, and motivating skilled workers—key priorities identified in their recent member survey,” said Andrew Walker, Business Development Director at Personal Group. How is Personal Group transforming rewards and benefits? “The partnership between CEA and Personal Group is a strategic move to enhance employee wellbeing and engagement, which is crucial for addressing the skills gap in the sector. By offering comprehensive benefits and support through the Hapi platform, this collaboration aims to create a happier, healthier, and more productive workforce for our members. This initiative is designed to positively impact employee retention and productivity, ultimately contributing to the sector’s growth and stability.” Viki Bell CEA Director of Operations Our Strategy in Action continued 16 Personal Group Holdings Plc | Annual Report and Accounts 2024 How is Personal Group transforming rewards and benefits? “At San Carlo, our commitment to excellence extends beyond our menus and hospitality, to the wellbeing of our dedicated team. Partnering with Hapi has been a transformative experience, elevating our employee benefits to the next level. The platform’s comprehensive offerings have been incredibly valuable to our staff, allowing them to access a range of invaluable benefits with ease and efficiency. Our people are the essence of our brand, and with the support of Hapi, we have been able to ensure they experience the same passion and joy that we pour into every plate. Grazie, Hapi, for helping us enrich the lives of our team, one benefit at a time.” Paul Jones-Nolan Head of People, San Carlo Increasing adoption of the Hapi platform by new customers The success of San Carlo’s Restaurant Group implementation of Hapi validates the investments made to enhance the user experience and highlights the growing market need for our Reward & Benefits offerings by employees trying to attract and retain their workforce. Outcome While just in its first year alone, over 40% of employees actively use ‘Squadra’ and the Group plan to explore salary sacrifice benefits and enhanced communications to increase this engagement – meaning the future of San Carlo’s benefits package looks more than appetising. Maintaining a happy, healthy workforce and strong employee retention amid expansion is a priority—and a challenge— especially when engaging a predominantly deskless workforce. The Personal Group Solution San Carlo partnered with Personal Group in 2024 to implement a tailored employee benefits solution. Recognising the power of reward and recognition, San Carlo aimed to ensure its workforce felt valued, knowing happy staff leads to happy customers and stronger teamwork. Hapi, branded as ‘Squadra,’ supports employee wellbeing with access to the Employee Assistance Programme (EAP) and health tools. Initiatives like “Wellbeing Wednesday” highlight these resources, while its mobile-first design ensures accessibility for deskless workers. Peer-to- peer and manager-to-peer appreciation tools enable a culture of gratitude. San Carlo Restaurant Group Employees: 1,200 Website: sancarlo.co.uk Hapi launched: 2024 Renowned for its authentic Italian cuisine and exceptional service, San Carlo operates 25 sites across the UK, including Manchester, Liverpool, Leeds and London. The Group continues to expand bringing its signature Italian charm to new cities globally. Challenges Hospitality is often characterised by high employee turnover, transient workforces and a reliance on temporary staff. However, San Carlo defies this trend. With authentic Italian family values at its core, the Group appreciates loyalty among its employees. Many staff members stay for over 20 years, reflecting meticulous recruitment processes and a strong company culture. Benefits & Rewards – Adoption 17 Financial Statements Overview Governance Strategic Report How is Personal Group transforming rewards and benefits? “Personal Group enables us to maximise our reward budget, demonstrating to staff that our value proposition extends beyond pay. The Hapi app sets us apart in a competitive market, and we’re excited to expand its functionality further.” Arlene Stone HR Director, Bath Spa University Industry leading technology driving customer expansion Securing Bath Spa University as a client and the value we’ve delivered them and their employees through our award-winning technology is evidence of the quality of our offering and the competitive strength of the Hapi platform. Outcome Hapi has significantly boosted employee engagement, with 54% of staff using the platform—more than double the industry average. A webinar promoting the platform attracted over 200 attendees, highlighting widespread interest. Employees praised the retailer discounts, simplified access to the Cycle to Work scheme, and the environmentally friendly EV scheme, with 14 employees opting into the latter since launch. By addressing BSU’s challenges, Hapi has transformed benefits delivery, improving employee satisfaction, wellbeing, and communication. The Personal Group Solution BSU partnered with Personal Group to introduce Hapi, a tailored, mobile-first platform that consolidated all employee benefits into a single, easy-to-use hub accessible via smartphones or desktops. Key features included: 1. Comprehensive Benefits Access: Employees could easily explore and use benefits such as retail discounts, gym memberships, the Cycle to Work scheme, and the newly introduced Electric Vehicle (EV) Scheme. 2. Enhanced Wellbeing Support: The app integrated BSU’s existing Employee Assistance Programme (EAP) to provide mental and emotional health resources. 3. Financial Savings: Retail discounts and salary sacrifice schemes enabled staff to save money on everyday expenses and seasonal purchases like home technology at Christmas. 4. Effective Communication: The app allowed HR to communicate directly with employees, ensuring all staff—including deskless workers—were connected and informed. Bath Spa University Sector: Education Employees: 2,000 Challenge Communication & Engagement; Employee Wellbeing Overview Bath Spa University (BSU) serves 7,000 students and employs over 2,000 staff across diverse roles, from lecturers to caterers and groundkeepers. While BSU curated an impressive benefits package, feedback revealed many employees were unaware of what was available. Their existing intranet-based system lacked accessibility for deskless staff, interactive features, and communication tools, creating a disconnect. BSU sought a centralised solution to enhance visibility, improve employee engagement, and create a stronger employee value proposition. Benefits & Rewards – Adoption Our Strategy in Action continued 18 Personal Group Holdings Plc | Annual Report and Accounts 2024 Key Performance Indicators Lead indicators As part of our strategy for delivering long-term sustainable growth, we have identified a number of lead indicators, the improvement of which will enable us to grow both our revenue and profits and build future value for the business. Lead Indicator Why we chose it 31 December 2024 31 December 2023 Value of Annualised Premium Income Annualised premium income refers to the annualised premium value of policies in force at the end of the financial year net of IPT. Increasing the Annualized Premium Income is a key performance indicator of the growth of our expanding insurance book £36.0m £31.6m Number of insurance payers Re-invigorating growth in insurance payers, together with a consistent focus on retention, will help us increase the size of our insurance business. We have chosen to use payers instead of our historic measure of policies to reflect that the majority of our premiums are collected through payroll deduction and our retention rates are largely determined by the actions of the individual payer 100,823 97,327 Number of employees available for face-to- face insurance Increasing the number of employees who are available for face-to-face insurance sales is vital to achieve increased penetration across our existing clients as well as making us an important part of clients’ employee wellbeing proposition 397,513 n/a (new metric) Total number of Enterprise clients Winning new clients and retaining existing ones will be key to us being able to grow our business 398 398 Total number of SME clients Increasing the number of SME clients we provide services to will be fundamental to us achieving our growth aspirations 4,436 3,912 The Group meticulously reviews its performance Measured across a number of KPIs. Total client number 4,834 (2023: 4,310) Number of insurance payers 100,823 (2023: 97,327) Annualised Premium Income £36.0m (2023: £31.6m) 19 Financial Statements Overview Strategic Report Governance Year on year insurance retention 2 81.8% (2023: 82.5%) 2024 2023 2022 2021 82.5% 81.1% 80.8% 81.8% 2024 2023 2022 2021 Annualised new business premium 1 £13.9m (2023: £11.8m) £13.9m £11.8m £9.5m £3.7m 2024 2023 2022 2021 Annualised recurring revenue for SaaS licences 4 £7.4m (2023: £6.7m) £7.4m £6.7m £5.6m £3.6m Hapi Net Retention Rate 5 91% (2023: 112%) 2024 2023 2022 91% 112% 109% 2024 2023 2022 2021 Activated users 6 464,294 (2023: 509,877) 464,294 509,877 470,373 422,184 Other KPIs In addition to our lead indicators we continue to measure against a variety of additional KPIs both across the Group and within the various business segments. 1. Annualised new business premiums are a key performance indicator as, whilst no direct reconciliation to earned premiums for the year can be carried out, they are a primary driver of earned premiums in future years and, as such, are a key measure for the Group. For a weekly premium, the measure is calculated as the value of the premium (net of IPT) x 52; for a monthly premium, the value of the net premium (net of IPT) x 12. 2. The year on year retention rate is the annual retention rate of policyholders who have held the policy for more than 1 year. 3. The claims ratio is calculated as claims incurred plus net change in claims provision, less reinsurers share of claims paid as a proportion of insurance income less outward reinsurance premiums. 4. The SaaS license total includes Hapi, SEB and Innecto Digital recurring revenue. 5. Net Retention Rate measures revenue retained from existing customers, including upgrades, downgrades, and churn. 6. Activated users for 2021, 2022 and 2023 has been restated to exclude Let’s Connect users. 2024 2023 2022 2021 Claims ratio 3 29.1% (2023: 27.0%) 29.1% 27.0% 27.3% 24.7% Key Performance Indicators continued 20 Personal Group Holdings Plc | Annual Report and Accounts 2024 “Strong growth in the insurance book driven by another record year of new policies written.” Sarah Mace Chief Financial Officer Chief Financial Officer’s Statement Continuing to build recurring revenues across all business lines Providing confidence and visibility for 2025. Group revenue from continuing operations £43.8m (2023: £38.6m) Adjusted EBITDA from continuing operations £10.0m (2023: £7.8m) Earnings per share from continuing operations 17.7p (2023: 13.4p) Financial Statements Overview 21 Strategic Report Governance Group revenue Group revenue from continuing operations grew 13% to £43.8m (2023: £38.6m). A strong performance in our insurance segment, driven by another record year of new policies written, resulted in growth of the insurance book to £36.0m Annualised Premium Income (API) (2023 £31.6m), the majority of which continues to renew on weekly or monthly rolling contracts. In line with our revised strategy, our previously separate Benefits Platform, and Pay and Reward, segments have been combined to form one new “Benefits & Reward” segment. Income in this segment increased to £10.3m for the year (2023: £8.9m) with growth arising from both SaaS and Consultancy income. Other income increased to £1.3m (2023: £0.9m) as a result of further leveraging the increased cash deposits held by the insurance subsidiaries. The Group continues to build its recurring revenues across all business lines, with over 90% of reported revenue for 2024 deriving from one of these sources, providing confidence and visibility as we enter 2025. Group results 2024 £’000 2023 £’000 Revenue 43,776 38,585 Adjusted EBITDA 9,984 7,757 Operating profit 6,932 5,154 Profit before tax 6,826 5,078 Tax (1,298) (899) Profit for the year from continuing operations 5.528 4,176 Profit from discontinued operations 968 148 Profit for the year 6,496 4,324 2024 £’000 2023 £’000 Profit before tax from continuing operations 6,826 5,078 Finance costs 106 79 Depreciation 1,111 1,065 Amortisation of acquired intangibles 110 273 Amortisation (other) 1,305 460 Share-based payment expense 202 169 Restructuring Costs 324 639 Adjusted EBITDA from continuing operations 9,984 7,756 * Adjusted EBITDA is defined as earnings before interest, tax,depreciation, amortisation of intangible assets, goodwill impairment, share-based payment expenses, profit or loss on disposal of subsidiaries, corporate acquisition costs and restructuring costs. ** Continuing operations excludes the results of Let’s Connect, which was disposed of on 9 July 2024 (see notes 28 and 30). *** Claims ratio is calculated as claims incurred plus net change in claims provision, less reinsurers share of claims paid as a proportion of insurance income less outward reinsurance premiums. Chief Financial Officer’s Statement continued Adjusted EBITDA Adjusted EBITDA from continuing operations for the year grew 29% to £10.0m (2023: £7.8m) following increases in contribution from the insurance segment, where underwriting profit continued to deliver strong margins while growing in line with the size of the insurance book. The ongoing value of our insurance proposition to our policyholders can be seen in the upturn in our claims ratio to 29.1% (2023: 27.0%) as NHS activity increased throughout 2024. The Benefits & Reward segment also continued to drive growth in EBITDA, with contribution up 20% to £5.2m (2023: £4.3m), driven by new platform sales in both Hapi and Sage Employee Benefits, our white-labelled product, as well as a strong performance across consultancy and digital reward platform sales. Outside of the core segments, Group administration and central costs increased year on year reflecting inflationary wage and operating expense increases. We continue to believe that adjusted EBITDA remains the most appropriate measure of performance for our business, reflecting the underlying profitability of the business and removing the impact of one-off items arising from past acquisitions on the Group’s reported profit before tax. The definition remains unchanged from previous years. 22 Personal Group Holdings Plc | Annual Report and Accounts 2024 Profit before and after tax Statutory profit before tax from continuing operations for the year was £6.8m (2023: £5.1m), which is net of £0.3m of restructuring costs across the Group. The tax charge for the year was £1.3m (2023: £0.9m), and profit after tax for the year £5.5m (2023: £4.2m). Discontinued operations Profit from discontinued operations of £1.0m (2023: £0.1m) represents the total after tax profits relating to Let’s Connect which was disposed of during the year, including a £1.2m profit on disposal. Let’s Connect was a seasonal business therefore selling the business mid-year left the Group with an in-year loss from activity to the date of sale. EPS Resulting earnings per share were up 32% to 17.7p (2023: 13.4p) from continuing operations. The calculation is detailed in Note 11. “Strong cash generation from operating activities of £11.4m” Sarah Mace Chief Financial Officer Dividend The Board has recommended a final ordinary dividend of 10.0 pence per share, making a total ordinary dividend for 2024 of 16.5 pence per share. The Board has considered the level of dividend in the context of both the underlying growth seen during the year and the increased in-year profit and cash realisation as a result of the disposal of Let’s Connect, alongside continued confidence in the Group’s business model and prospects. Balance sheet As at 31 December 2024 the Group’s balance sheet remained strong, with cash and deposits of £27.4m (2023: £20.1m) and no debt. The Group’s primary underwriting subsidiary, Personal Assurance Plc (PA), continues to maintain a conservative solvency ratio of 279% (unaudited), with a £7.6m surplus over its Solvency Capital Requirement of £4.3m. The Company has consistently maintained a prudent position in relation to its Solvency UK requirement. Personal Assurance (Guernsey) Limited, the Group’s subsidiary which underwrites the death benefit policy, also maintained a healthy solvency ratio of 544% (unaudited), with a £3.6m surplus under its own regime. Alternative performance measure Adjusted EBITDA, which is referenced throughout this document, is an alternative (non-Generally Accepted Accounting Practice (non-GAAP)) financial measure used by the Group when reviewing performance, evidenced by executive management bonus performance targets. As such, this measure is important and should be considered alongside the IFRS measures. Adjusted EBITDA takes into account adjustments, in addition to the standard IFRS measure, which are considered to be non-underlying to trading activities and which are significant in size. For example, goodwill impairment is a non-cash item relevant to historic acquisitions; share-based payment expenses are a non-cash item which have historically been significant in size but can fluctuate based on judgemental assumptions made about share price and have no impact on total equity; corporate acquisition costs and reorganisation costs are both one-off items which are not incurred in the regular course of business. The definition above has not changed during the year. 23 Financial Statements Overview Strategic Report Governance Cash flow Cash generation is a key quality of the business and the business generated £11.4m in cash from operations in 2024 (2023: £6.7m). This has been particularly high in the year following the realisation of opening working capital in Let’s Connect (c. £2.8m) prior to its disposal in July. Underlying cash generation remains strong. With capital required of currently c£10m to support insurance business and working capital, there is opportunity to invest to deliver the Group’s business plans including product developments and enhancements as well as increasing the return to shareholders via in increased dividend and selectively considering earnings enhancing acquisitions that will enable acceleration of growth. Segment Description Income Streams Affordable Insurance A directly owned benefit, provision of simple insurance products underwritten by Group subsidiaries. Insurance income. Benefits & Reward Provision of a benefits platform to employers both directly and through channel partners, currently Sage for our SME solution. Provision of a full reward service to employers through the Group’s pay and reward subsidiaries, Innecto and QCG. Digital platform subscriptions, commissions from third party benefits which sit on the platform. Consultancy, industry surveys and digital platform subscriptions. Segmental results The Group reports across two core segments as detailed in the table below. For each of the segments, the adjusted EBITDA contribution comprises the gross profit of that segment together with any costs associated directly with the operation of that segment. Sales and marketing costs and other central costs that are not directly attributable to a segment, such as Finance, HR, depreciation, amortisation and Group Board expenses are not allocated to a segment and are shown separately as ‘Group Admin and Central Costs’. We believe this presentation provides transparency to enable the impact of top line growth on adjusted EBITDA contribution for each area of the business to be better understood. Revenue Dec-24 £’000 Dec-23 £’000 Affordable Insurance 32,166 28,708 Benefits & Reward 10,277 8,931 Other 1,333 946 Total Revenue from continuing operations 43,776 38,585 Adj EBITDA Contribution Dec-24 £’000 Dec-23 £’000 Affordable Insurance 12,424 11,226 Benefits & Reward 5,215 4,330 Group Admin & Central Costs (8,937) (8,732) Other 1,282 933 Total Adj EBITDA from continuing operations 9,984 7,757 The Benefits & Reward AND Affordable Insurance segment continues to drive growth in the Group EBITDA result. Chief Financial Officer’s Statement continued 24 Personal Group Holdings Plc | Annual Report and Accounts 2024 Affordable insurance Insurance revenue from the Group’s core insurance business grew 12% to £32.2m (2023: £28.7m). The continued success of our face-to- face sales activity, which directly engages employees with their employers’ benefit provision, resulted in a second successive record year for new insurance sales, with £13.8m written (2023: £11.8m). The combination of these new sales alongside continued strong retention rates means that, as at 31 December 2024, we had £36.0m (2023: £31.6m) of Annualised Premium Income, and over 100,00 insurance payers. The claims ratio for the year increased to 29.1% (2023: 27.0%), in line with general increased NHS activity across the UK. Adjusted EBITDA contribution of £12.4m for the year (2023: £11.2m), reflected the increased underlying profit arising from increased revenue despite the increase in claims activity. Benefits & Reward Revenue from digital platform subscriptions and commissions from third party benefit suppliers which sit on the benefits platform rose 16% to £7.8m in 2024 (2023: £6.7m). Subscriptions for our enterprise platform, Hapi, continued to build with ARR on the platform increasing to £2.7m (2023: £2.5m) with 27 new clients won during the year. Our footprint in the SME market further widened with Sage Employee Benefits, the Group’s SME proposition being taken to market through its partner Sage. ARR here increased to £4.1m at the end of the year (2023: £3.7m). We delivered our largest ever reward consultancy project during 2024 and drove further growth in digital subscription income from proprietary HR solutions to £0.7m (2023: £0.6m). The operational merger of our Innecto and QCG businesses in the latter stages of 2023 also drove efficiencies in both delivery effort and costs through 2024. Adjusted EBITDA contribution of £5.2m (2023: £4.3m) demonstrates the continued development in this segment and serves as a reminder of the opportunity for growth on which the Group plans to capitalise. Group administration expenses and central costs Group administration and central costs of £8.9m (2023: £8.7m) reflects inflationary cost increases associated with salaries, corporate and fleet insurances, IT delivery and other services. Restatement Following the Group’s disposal of Let’s Connect on 9th July 2024, Let’s Connect activities have been classified as discontinued operations. As a result, and in accordance with IFRS 5, the prior year income statement has been restated to split out the discontinued operations of Let’s Connect. Fixed interest rate bank deposits with the maturity date of three months or more from the date of acquisition are classified as financial assets. The reported balance sheet as at 31 December 2023 included a misallocation of cash held on deposit. These accounts were incorrectly reported as cash rather than financial assets. The prior year balance sheet and cash flow statement have been restated to correct this allocation. Neither of these restatements have had an impact on the bottom line profit or net asset position of the Group in the prior year. Sarah Mace Chief Financial Officer 25 March 2025 25 Financial Statements Overview Strategic Report Governance Risk Management Oversight The Board is responsible for overseeing the effectiveness of the risk management and internal control systems as well as identifying the nature and extent of the principle risks the Group is willing to take in achieving its strategic objectives, including the setting of the overall risk appetite and tolerance levels. The Board delegates oversight of risk management to the Risk and Compliance Committee, who in turn regularly report to and make recommendations to the Board. The Risk strategy, appetite and framework are set out in a suite of policies covering the material risks which exist in the business; each policy is subject to annual review and approval. We employ an Enterprise Risk Management framework (ERM) to manage all types of risk which, alongside our Own Risk and Solvency Assessment activity, enables reasonable assurance to be provided to the Board and external stakeholders that the Group is achieving its risk management and internal controls objectives. The effectiveness of the risk management system is also independently assessed periodically by the outsourced Internal Audit Function in their role as third line of defence, with the results reported to the Audit Committee. The Board is satisfied that the processes set out above enable the Group to effectively identify, assess and manage current and emerging risks and allow the required focus on risk awareness, ethical behaviour and providing customers with good outcomes. Risk management approach The risk environment is managed through a two-pronged approach: top-down risks that threaten the strategic plan, and bottom- up financial, operational, regulatory and non-insurance risks which threaten the achievement of business area objectives. Each month a Risk Forum is held where the Senior Leadership Team discusses the key risks, both current and emerging, with optimising activities and timelines for implementation agreed. We operate a ‘three lines of defence’ approach to define risk management within roles and responsibilities. The Group’s risk governance is overseen by a Risk function led by the Head of Risk, with independence assured through direct and separate access to the Chair of the Risk and Compliance Committee. Effective risk management is central to our culture And key to achieving our strategic objectives. First Line Business Area Owner • Identify, assess and manage risks on a daily basis. • Develop and implement policies and procedures. • Ownership of business practices. • Ensure activities are consistent with objectives. • Implement controls. • Control self-assessment. Third Line Internal Audit (outsourced) • Independent assurance of the effectiveness of the first and second lines of defence. • Independent reporting to the Board and to the Audit Committee. • Advisory role. Second Line Risk Function • Risk identification. • Developing and oversight of the enterprise risk management framework. • Risk reporting to Risk Forum and to the Risk and Compliance Committee. • Providing advice and guidance to business areas and to the Senior Leadership Team and Board. • Assurance of the effectiveness of policies and procedures. 26 Personal Group Holdings Plc | Annual Report and Accounts 2024 Below is a summary of the key risks the Group faces, including current and emerging factors and risk optimisation activities: Risk Type Key risks (with an impact of £500k+ within the next year) Current and emerging factors Optimising activities Change in risk exposure Strategic Risk The Group is unable to take advantage of growth opportunities from its products and services proposition. The Group needs to continue to design innovative and desirable products and services to capitalise on opportunities to accelerate growth at pace and to further enhance its attractiveness to investors, in light of increasing competition in the benefits space. Investment in the design and build of Hapi 2.0 which has an improved user experience, better MI for client employers, improved functionality, greater ability to integrate third- party benefits and provides a platform to be developed to meet future client needs. Enhanced engagement with clients to better understand their people agenda and engagement and wellbeing priorities. Work ongoing to relaunch Group Cash Plan Product direct to market. Annual product governance review of the group’s personal insurance products which considers market and product research, customer feedback, design, value, price, build, testing, and launch and sales channels. Better analysis of MI to help drive product enhancements and improve supporting customer service. Successful relaunch in Q2 2024 of core Convalescence product in response to customer feedback, value assessment and market research, as well as enhancements to the benefits of the Hospital Plan product. The Board approved a bi-annual insurance/fair value update in October 2024. Stable due to client demand, new entrants in the market and increasing competition. The Group needs to continue to deliver personal insurance products that meet evolving demands and needs of consumers, through positive engagement and customer research. The Group is unable to harness technology to accelerate and revolutionise its products and services. The use of Agile technology methodologies in product design has revolutionised product development by emphasising flexibility, iteration, and customer-centricity. Low-code software development and use of AI assistance allows for a more agile approach to technology development. PG is increasingly exploring these solutions to improve products and accelerate delivery. Investment in in-house and outsourced technology systems and people, to build, test and deliver Hapi 2.0. Investment in technology to support policy/pricing changes and to help improve and streamline policy administration and the servicing of policies. Increasing due to reliance on technology to support change and innovation and need to make quick and efficient business decisions. Client & Customer Retention Risk Loss of client / partner relationships. Clients and partners are increasingly and understandably looking to measure value from their commercial relationships. The Group needs to continue to demonstrate value through data led insights and performance to maximise return from existing relationships and continue to be attractive to prospective clients and partners. Relationship management of clients and partners. Use of customer surgeries and weekly client feedback reviews to help prioritise and fast-track remedial work. Early renewal/extension of key client contracts. Stable due to client demand, new entrants in the market and increasing competition. Client concentration risk . A subset of the above risk, however the overall impact on the Group could be significant with the loss of one or more large clients, i.e., clients that provide in excess of 20% of revenue. Payroll slots for collection of insurance premiums built into contracts as ‘enduring’ wherever possible. Stable due to client demand, new entrants in the market and increasing competition. 27 Financial Statements Overview Strategic Report Governance Risk Type Key risks (with an impact of £500k+ within the next year) Current and emerging factors Optimising activities Change in risk exposure External Environment/ Economic and Regulatory Risk Environmental or economic change impacts profit. Direct and indirect impacts of the 2024 Budget (i.e., due to increase in employers NI) and increased business overheads impacts the spending power of clients, leading to them spending less on the products and services the Group provides. Increased business operating costs and cost of acquisition impacts the profitability of the Group’s products and services. Claims uncertainty and volatility – There is a risk that we are unable to predict our future claims liability as we see performance deviating from assumptions and historical norms. Clear go to market message around how the Group’s offering can support employees navigate through the ‘cost of living crisis’ through the use of discounts and the Group’s ‘value propositions’, alongside wellbeing and employee assistance programmes offered via Hapi. Engage with clients and prospective clients to help employers maximise the benefit of their employee benefits programme to help attract and retain staff, thus promoting the value of the Group’s proposition. Pricing strategy. P&L reporting, pricing reviews across the Group’s segments and stress and scenario testing. Claims volume monitoring and stress and scenario testing. Where appropriate, and whilst continuing to offer fair value to consumers, we will reprice our products to reflect increased operating expenses. Increasing overall due to continued budget constraints at clients, continued cost-of-living squeeze on individual customers and embedding of Consumer Duty arrangements. Non-compliance with regulatory requirements leads to regulatory censure (and ensuing reputational damage). The FCA Consumer Duty intends to create a “race to the top” in terms of the quality and value of financial products and services, the way firms interact with customers and the customer service and support firms provide. The onus is on firms to demonstrate that their products provide value relative to the price consumers pay and have tangible ways of monitoring the effectiveness and quality of communications and customer service. The Group has processes in place to help ensure we remain compliant with regulatory and legal requirements. We have a robust regulatory horizon scanning process, to ensure we are able to respond appropriately to current and emerging regulatory changes. Our key areas of focus continue to be: Measuring ourselves against FCA guidance, thematic reviews and supervisory work to ensure we are meeting regulatory expectations and best practice; Enhanced training and awareness for staff, to ensure that the Consumer Duty requirements are embedded in all business processes: • Identifying and supporting vulnerable customers through staff training, monitoring, use of management information and outcomes reporting; • Improving our product governance processes, MI, value assessments and Board reporting; and • Improving customer communications, feedback and service. PG is also actively engaging with the wider industry to share best practice. In June 2024, the Group won the “Leadership in Vulnerable Customers” award at the inaugural Consumer Duty Leadership Awards; an event held by an Innovate UK-supported consortium comprising representatives from industry, academia and charities in the financial services sector. Stable due to increased understanding of regulatory expectations of firms, aided by FCA guidance and sharing of best practice and internal audits. Risk Management continued 28 Personal Group Holdings Plc | Annual Report and Accounts 2024 Passionate about our Purpose Environmental, Social and Governance ESG is at the heart of our business – our purpose is to improve people’s health and wellbeing. The development of our ESG strategy is overseen by our Board, who is passionate about ensuring Personal Group has a positive impact on our environment and society and adheres to an ethical and sustainable decision-making framework. This passion is shared by our whole organisation, and this has been reinforced by our new ESG Bonus Gateway. ESG Bonus Gateway In 2024, the Group moved ESG metrics from LTIPs to bonuses, incorporating them into a new bonus gateway. This change aimed to make ESG targets a meaningful part of remuneration across the entire business, not just for the leadership team, while introducing specific yearly targets. The bonus gateway set targets under three ESG pillars, with funding linked to the number of objectives met. Meeting four objectives released 100% of the Bonus Pool. We are proud of this achievement and have set even more ambitious goals for 2025. Financial Statements Overview 29 Strategic Report Governance ESG overview ESG is at the heart of our business. Group Fleet metric tonne output Target: An output of less than 305 tonnes, down from 365 tonnes in 2023. Update: Surpassed our target, with an output of 262 tonnes People-related policies Target: Review and improve our people-related policies, updating a minimum of 10 policies a year. Update: Have updated 11 of our policies – Maternity Policy, Paternity Policy, Carers Leave, Fertility Leave, Ordinary Parental Leave, Adoption Policy, Menopause, Domestic Abuse, Flexible Working Policy, Equality, Diversity & Inclusion, and Miscarriage Policy. QCA Code compliance Target: Understand and implement the new QCA Code required from 2025. Update: The new code has been reviewed and early adopted in FY24 – see page 37 for more detail on Personal Group’s QCA code compliance. PACT spend Target: Focus PACT donations on targeted areas. Also arrange for volunteer days for specific projects in 2024, with a view to making volunteer days available through an approval process and have the Senior Leadership Team complete at least one volunteer day each to lead by example. Update: PACT donations continue to allow employees to allocate £100 per year to a charity of their choice as well as customers and policyholder nominations. Donations also benefitted the community with amounts donated to local schools and community foundations. Launched our new Volunteering Policy, providing colleagues with a day of paid leave each year, which is also participated in by the Senior Leadership Team. Carbon Emissions Target 2025: Less than 2.0 tCO 2 emitted per full time equivalent person (FTE). DE&I Initiatives Target 2025: Review our DE&I initiatives at quarterly meetings and implement at least four new initiatives that support our DEIB agenda. Volunteering Target 2025: At least 150 volunteering days in total to be taken by employees to support our charitable projects. Group total energy consumption Target: Energy consumption to be less than 800 Mwh, improving on 845 MWh in 2023. Update: Surpassed our target, with a Group total energy consumption of 769 MWh. Environment Social Governance Governance Targets 2025: Revise all of our mandatory training modules to ensure they are relevant and impactful, and have a 90% completion rate to support Personal Group’s compliance obligations and strategy. All new starters to complete formalised induction training with bi-annual updates to be completed by all staff. 30 Personal Group Holdings Plc | Annual Report and Accounts 2024 Environmental, Social and Governance continued SECR Compliance Statement. Our carbon footprint for the 2024 reporting year has been calculated based on our environmental impact across scope 1, 2 and 3 (selected categories) emissions sources for the UK only. Our emissions are presented on both a location and market basis. On a location basis, our emissions are 417 tCO 2 e, which represents an average impact of 1.65 tCO 2 e per full time employee, and on a market basis, our emissions are 397 tCO 2 e. We have calculated emissions intensity metrics on revenue, floor area and employee bases, which we will monitor to track performance in our subsequent environmental disclosures. The GHG Emissions Results table shows a 29% decrease in emissions, reflecting the fleet changes made in late 2022, where ICE vehicles were replaced with hybrids. This reduced the company fleet’s share of total emissions to 63% from 71% in 2022. Additionally, reduced electricity usage from closer monitoring and the closure of the Lets Connect office led to a decrease in tCO 2 e per employee, dropping from 2.00 in 2023 to 1.65 this year. Our energy and carbon calculations have been conducted in accordance with the UK Government’s Reporting Guidelines for Company Report. Data has been reviewed and verified by a third-party (Adler and Allan). GHG calculations have been performed using the Greenhouse Gas Protocol Corporate Reporting Standards (GHG Protocol) and ISO14064-1:2018 Greenhouse Gases – Part 1: Specification with guidance at the organization level for quantification and reporting of greenhouse gas emissions and removals. All emissions calculations use up to date GHG Conversion Factors for Company Report (BEIS) and are reported as carbon dioxide equivalent (CO 2 e), accounting for all major greenhouse gases. The table below sets out total energy consumption and resulting GHG emissions by scope arising from business operations. Summary GHG Emissions Results Scope 1 Emissions (tCO 2 e) FY2022 FY2023 FY2024 % From Baseline Natural Gas 90 97 99 +10% Company Fleet 370 365 262 -29% Scope 2 Emissions (tCO 2 e) Purchased Electricity (location-based) 52 53 47 -10% Purchased Electricity (market-based) 52 53 27 -48% Scope 3 Emissions (tCO 2 e) Grey Fleet Mileage 11 14 9 -18% Total Emissions (tCO 2 e) Total Emissions (location-based) 523 533 417 -20% Total Emissions (market-based) 523 533 397 -24% Intensity Ratios (location-based) tCO 2 e per £m Revenue 10.50 10.73 9.53 -9% kgCO 2 e per Floor Area 58.24 61.53 51.49 -12% tCO 2 e per Employee 1.90 2.00 1.65 -12% 31 Financial Statements Overview Strategic Report Governance Environmental, Social and Governance continued Spotlight The introduction of Paid Carers Leave. At Personal Group, our new Paid Carer’s Leave policy has evolved from listening to our employees and ensuring our dedicated carers get the support they need. Under our new policy, which we have affectionately named Marie Carey’s carers policy after a long-serving employee advocated for the requirement due to her own challenging circumstances, caregivers will be entitled to up to five days of paid leave within a rolling 12-month period from day one of employment. Earlier in the year, new statutory regulations mandated unpaid leave for caregivers. We wanted to go beyond this to offer paid leave to support employees as part of our recognition of the financial strains often experienced by employees in such situations, underscoring our commitment to supporting employees through various life stages, alleviate the challenges faced by caregivers, and create a workplace culture that values inclusivity and empathy. Commenting on the initiative, Marie Carey , Operational Risk and Compliance Manager at Personal Group, expressed her gratitude, stating: “ As the sole carer for my 93-year-old Mum who was diagnosed with dementia in 2021, some of my annual leave was used up on her medical appointments. This additional allowance will enable me to use my holiday for what it is intended, to have some much-needed ‘me’ time. I am sure that I speak on behalf of myself and my colleagues who have caring responsibilities, when I say how extremely grateful I am for this support.” We have committed ourselves to being a leader in the field regarding vulnerable customer policies. In the year we established a Consumer Duty working group which ensures our customers are cared for above and beyond the FCA regulations. This year we received a Vulnerable Customer Award for our endeavours to support vulnerable customers. We have also set up a vulnerable customer forum, through which we have invited a number of charities to speak to us to ensure we remain at the forefront of issues. We plan to run these forums at least once a quarter. Consumer duty Find out more on our website: www.personalgroup.com/responsible-business Find out more on our website: www.personalgroup.com/consumerduty 32 Personal Group Holdings Plc | Annual Report and Accounts 2024 Section 172 Statement To act in the way they would consider, in good faith, would be most likely to promote the success of the Group for the benefit of its members as a whole and, in doing so, to have regard (amongst other matters) to: • the likely consequences of its decisions in the long-term; • the interests of the Group’s employees; • the need to foster the Group’s business relationships with suppliers, customers and others; • the impact of the Group’s operations on the community and the environment; • the desirability of the Group maintaining a reputation for high standards of business conduct; and • the need to act fairly between members of the Group. The Chairman sets out the text of s172 Companies Act 2006 on every Board agenda by way of a reminder. The table that follows is a description of our key stakeholder groups and how we engaged with them in 2024. The Directors are aware of their duty Under s172 of the Companies Act 2006. Why we engage with How we engaged in 2024 What matters to the Group Our Policyholders Our policyholders are key to the long-term success of the Group. The retention of existing, and attraction of new, policyholders is equally important. We aim to make any interaction with Personal Group as positive and simple as possible and ensure that our products are regularly reviewed and fit for purpose. Provision of suitable and targeted employee benefits to our relevant market sectors. We deliver individual face-to-face presentations to potential and existing policyholders at their workplace. The Group remains focused on positive outcomes for policyholders, with a Consumer Duty working party meeting regularly to ensure compliance with FCA regulations and excellent customer service. In 2024, Personal Group won the ‘Leadership in Addressing Vulnerable Customers’ Needs’ award at the inaugural Consumer Duty Leadership Awards, recognizing our best-in-class approach. We also engaged with local charities supporting vulnerable groups, holding roundtable discussions and delivering bespoke training to our customer-facing teams. We enhanced our customer contact strategy by introducing a three-month follow-up for new policyholders, reminding them of their benefits. To improve operations, we continued using Voyc, an AI compliance tool, enabling full sales presentation reviews and greater support for sales executives. This contributed to improved retention rates in the cooling-off period (first 30 days). Our hybrid customer relations team, based in Milton Keynes, enhanced quality and productivity, making it easier for customers to contact us via phone, email, or webchat. In 2024, we handled over 63,000 calls, 46,000 emails, 23,000 online queries, and 1,800 webchats. We also streamlined the claims process, significantly reducing processing time, boosting customer satisfaction, and contributing to a TrustPilot score of 4.9. Our products are relevant and provide cost effective protection Fair and consistent pricing Efficient and sympathetic processing of claims Ease of access to customer service Strong net promoter score Strong retention rates 33 Financial Statements Overview Strategic Report Governance Why we engage with How we engaged in 2024 What matters to the Group Our Clients Our purpose is to help our clients drive productivity and profitability by improving employee engagement, retention and overall effectiveness. Through our suite of products and services we support employee wellbeing and foster a positive and equitable work environment, enabling businesses to enhance performance and create sustainable success. We engage and build relationships with our clients and their employees through various channels, including face-to-face sessions, digital communications, and hosting industry and business forums. We also share thought-leadership through white papers and provide quarterly insights tailored to our client needs. In 2024, we worked closely with all Hapi clients during their migration to Hapi 2.0, helping them unlock the potential of enhanced features and tools, including improved MI capabilities. Recognising the importance of data security, we are ISO27001 certified across the Group and ISO9001 certified for our employee benefits platform. We actively inform and advise on data security, promoting the adoption of enhanced security measures such as MFA to protect client and customer information. Trusted and valued partner to clients Product range, price and quality Convenience and accessibility Customer service Fair marketing Responsible use of personal data Ethics and sustainability Becoming a trusted partner Our Colleagues The Group’s long-term success is predicated on the commitment of our employees to our purpose and demonstration of our values. In order to deliver great customer service and improve our staff engagement scores we need to ensure that we provide an appropriate environment and communication channels to both attract and retain talent for now and the future. We have an open, collaborative, and inclusive management structure and actively engage regularly with our employees via regular “company chats” and quarterly business updates. We remunerate with competitive market-based pay, sector leading rewards and benefits alongside a learning culture and great career opportunities. We continue with our hybrid working policy for all office-based staff, feedback tells us that this helps our colleagues achieve a better work-life balance with subsequent gains in engagement and productivity. Following the announcement of the new QCA code, the Group has early adopted the changes and presents its remuneration policy, see pages 46-48 of this report, ahead of a non-binding vote at our next AGM. Fair employment Competitive pay and benefits Development and career opportunities Collaborative and supportive work environment Health and safety and colleague wellbeing Responsible and respectful use of personal data Our Suppliers Our suppliers are fundamental to the quality of our products and to ensuring that as a business we meet the high standard of conduct that we set ourselves. Our Hapi platform contains numerous third-party offerings which add value to the overall proposition. It is important that we ensure good working relationships with those suppliers but also to choose partners that allow the Group to fulfil its day-to-day operations to deliver our products and services to the best standard possible. We regularly engage in open and two-way conversations with our largest suppliers. Key suppliers are invited to attend and present at our client conferences or workshops. We continually review and update our supplier onboarding process and conduct annual reviews on all key suppliers to the Group. We work with our suppliers to ensure that they have effective controls in place to protect the security and privacy of our customers data. Contract management software is being introduced to improve the onboarding process and the management of suppliers and ongoing relationships. Long-term partnerships Collaborative approach Open terms of business Fair payment terms Section 172 Statement continued 34 Personal Group Holdings Plc | Annual Report and Accounts 2024 Why we engage with How we engaged in 2024 What matters to the Group Our Community & Environment The Board recognises the importance of leading a Group that not only generates value for shareholders but also contributes to the wider society. We encourage all our employees to engage in the local community and work with our PACT Committee to utilise the funds in the Personal Assurance Charitable Trust to support charities at home and abroad as discussed on page 30. We are conscious of the need for our business to focus on long-term sustainability and have seen the replacement of most of the Group’s fleet with a range of hybrid and low CO 2 petrol cars replacing less environmentally friendly cars. We are also taking steps to lessen commuting for our field sales team, both for their benefit but also for the environmental impact generated. During 2024 we entered into an agreement with a local school where we have provided funds for a sensory room and our employees have helped the school with trips and other activities. Reduce environmental impact Invest in local community Promote environmental offerings on platform, i.e. Cycle to Work Supporting local community by creating jobs and providing work experience and apprenticeships Our Shareholders Our shareholders are key to the long-term success of the business. Through our investor engagement activities, we strive to obtain investor buy-in into our strategic objectives and how we plan to deliver on them. We create value for our shareholders by generating strong sustainable profits and dividends. Through our investor relations programme, which includes regular updates, meetings, roadshows and our Annual General Meeting, we ensure that shareholders’ views are brought into the Boardroom and considered in our decision making. In 2024 we changed our NOMAD and are using this new relationship to improve how we engage with both our existing and potential shareholders. Financial performance Strategy and business model Dividend Long-term growth Reputation of the Group 35 Financial Statements Overview Strategic Report Governance Corporate Governance The Board continues to have a significant role to play in establishing the culture of the business. 2024 Committee meeting dates Board 8 Feb 29 Feb 14 Mar 2 May 23 May 19 Jun 17 Jul 17 Sep 16 Oct 3 Dec Audit 14 Mar 17 Sep Risk & Compliance 8 Feb 23 May 3 Dec Nominations 8 Feb Remuneration 8 Feb 14 Mar 17 Sep 3 Dec Chair’s Introduction Dear Shareholder My role as Chair of Personal Group is to ensure that the Board is performing its role effectively. I am pleased to present this section of our Annual Report, which highlights the framework of governance that underpins our operations and ensures accountability and transparency, aligned with the interests of our stakeholders. I also have responsibility for ensuring the robust governance of the Group through challenge and direction of the Senior Leadership Team. Good governance should enhance performance and deliver positively for our shareholders, staff, customers, suppliers and other stakeholders whilst still enabling achievement of the Group’s strategic aims. The Board continues to have a significant role to play in establishing the culture of the business, ensuring that it is consistent with our business model and suitably cascaded through the Group. This is monitored through engagement with the wider investor community, through involvement of the Board Committees and by use of the wide-ranging experience, skills and capabilities of Board members. The Group continues to develop an integrated succession plan for the Board. At present, the Board is engaged in the recruitment of a new Non-Executive Director as a result of the impending retirement of Bob Head. Bob has been serving as a Non- Executive Director of Personal Group since 2016 and is currently the Chair of both the Audit and Risk Committees. I would like to take this opportunity to express my gratitude for the support, wisdom and knowledge he has shared with me and the rest of the Board throughout his tenure with the Group. Since 2018, the Group has adopted and sought to adhere to the Quoted Companies Alliance (QCA) Corporate Governance Code. The QCA released an update to their code effective for periods beginning on or after 1 April 2024 and the Group has decided to early adopt the changes for the period ending 31 December 2024. The Board considers that it complies with each of the principles of the Code and we will monitor our performance against each of the 10 principles in the updated Code and strive for continuing improvement. A notable change resulting from Principle 9 of the Code on remuneration, is that the Remuneration Committee will voluntarily put separate advisory resolutions on its remuneration report and remuneration policy to its shareholders at the next AGM, and annually going forward. During 2024, we conducted our annual internal board effectiveness review and have subsequently begun working on actions to address areas identified for improvement. We are committed to external independent reviews every three years and will continue to complete annual internal board effectiveness reviews in the intervening years. The next external review is scheduled to take place in 2025. The Board met 10 times in 2024 and the number of meetings each Director attended can be seen on pages 38 and 39. In addition, the reports of the Audit, Risk and Compliance, Remuneration Committees and Nominations and SM&CR Committee can be seen later in this section. Martin Bennett Independent Non-Executive Chair 36 Personal Group Holdings Plc | Annual Report and Accounts 2024 QCA Code compliance The QCA published its updated Code in November 2023 which will apply to financial years beginning on or after 1 April 2024, with the first disclosures for Personal Group required for the period ending 31 December 2025. However, the Group has decided to early adopt the changes for the period ending 31 December 2024 to reflect its commitment to the Code and the positive changes it can make to our business and its stakeholders. Principle 1 – Establish a purpose, strategy and business model which promote long-term value for shareholders. Principle 3 – Seek to understand and meet shareholders’ needs and expectations. Principle 5 – Embed effective risk management, internal controls and assurance activities, considering both opportunities and threats, throughout the organisation. Principle 7 –Maintain appropriate governance structures and ensure that individually and collectively the directors have the necessary up-to- date experience, skills and capabilities. Principle 9 – Establish a remuneration policy which is supportive of long- term value creation and the company’s purpose, strategy and culture. Personal Group provides insurance services and a broad range of employee benefits and wellbeing products to businesses across the UK. The Group enables employers to improve employee engagement and support their employees physical, mental, social and financial wellbeing, supporting our vision of creating a brighter future for the UK workforce. Full details of our business model can be found on page 10 and on the Group website (www.personalgroup.com). Regular dialogue takes place with shareholders through initiatives including the Annual General Meeting, investor roadshows, regulatory announcements and the Report and Accounts. During 2024 our Chief Executive, CFO, Chair and other Non- Executive Directors met virtually, and in person, with key investors. We also hosted our investor events in March and September 2024. The Board is responsible for identifying and mitigating risks to the Group achieving its strategic objectives. It addresses risk management through an “Enterprise Risk Management Framework”, and a system of risk governance, including a Risk and Compliance Committee. During 2024, a risk based internal audit function was again provided by RSM. For further details see page 42. The Board is collectively responsible for the long-term success of the Group and for setting and executing the business strategy. It fulfils this responsibility through Board and other Committee meetings held regularly throughout the year. The background and experience of the Board ensures there is an effective and appropriate balance of skills and knowledge. Additional training is provided where needed and Board members are encouraged to maintain their professional development. The meetings held in 2024 for the Board and other Committees can be seen on page 36. A new principle in the updated QCA code, this has been in place for many years. Our remuneration policy reflects our commitment to ensuring that our approach to remuneration remains competitive, transparent, and in the best interests of our shareholders. As part of our engagement with the QCA code, and our early adoption of the new changes, both our remuneration policy and our remuneration statement will be put forward for a non-binding vote at the upcoming AGM. Principle 2 – Promote a corporate culture that is based on ethical values and behaviours. The Board believes Group culture is set from the top of the organisation. These values form a core part of how the business is managed, from recruitment to training, and ongoing reward and recognition. An employee engagement survey was conducted in August 2024 which produced valuable feedback enabling positive change to be made to the business culture in the last half of the year as noted in the ESG report on page 29. Principle 4 – Take into account wider stakeholder interests, including social and environmental responsibilities, and their implications for long-term success. As a Board we understand our duty to promote the success of the Group whilst considering the views of, and impact on, our wider stakeholder group of customers, policyholders, suppliers, colleagues and our community and environment as well as our shareholders. A more detailed summary of the Group’s engagement with all our stakeholders can be seen on pages 33 to 35. ESG is also central to all key decisions at a board level and, to ensure this remains an area of focus day to day, ESG targets have been added as a gateway to all staff bonus payments from 2024. Principle 6 – Establish and maintain the Board as a well-functioning, balanced team led by the chair. The Group maintains, and is satisfied that, the Board has a suitable balance of independence and knowledge, with Directors encouraged to challenge all matters. The Board meets regularly, with a formal schedule of matters for its approval. The Board is supported by regular engagement with the Senior Leadership Team, and a system of formal Board committees. Directors are required to devote sufficient time to carry out their role. Principle 8 – Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement. Board members are each set annual objectives, with performance feedback provided by corresponding Executive and Non-Executive members. Board evaluation is the responsibility of the Chair. Board effectiveness reviews are undertaken yearly, with independent reviews at least every three years. Principle 10 – Communicate how the Company is governed and is performing by maintaining a dialogue with shareholders and other relevant key stakeholders. The Group communicates through a variety of regular digital and traditional communications. These include face- to-face meetings, the Annual Report and Accounts, Interim Results, investor news announcements and information provided on the Group’s website. 37 Strategic Report Governance Financial Statements Overview Board of Directors Sarah Mace Chief Financial Officer Appointed October 2020 (previously Company Secretary from April 2014) Sarah joined Personal Group in January 2014 as Group Financial Controller and Company Secretary. Previously Head of Finance for private equity owned Chicago Leisure Ltd, she also has experience in a broad range of industries including roles at large communications firm Cable and Wireless and various life and pensions companies. Skills, personal qualities and capabilities Sarah is a Fellow Member of the Association of Chartered Certified Accountants and also has a Master’s degree in mathematics from Oxford University. 10/10 Meetings attended The Board has a combined wealth of knowledge and experience to help the business achieve success. Martin Bennett Non-Executive Chairman Appointed January 2021 (previously Non- Executive Director; appointed Chairman May 2021) Martin is an experienced non-executive and chairman, bringing over 20 years of financial service experience. He has a diverse and extensive skill set, stretching across commerce, operations and finance. Prior to embarking on a non-executive career in 2018 Martin spent nearly 15 years at HomeServe plc creating a FTSE 250 services business, holding CEO, COO and CFO responsibilities in the UK, US and Europe. Before this he spent three years as Finance Director of Clarity Group and 10 years at Arthur Andersen where he worked in audit and transaction services. Skills, personal qualities and capabilities An accounting and finance graduate, Martin is a Fellow of the Institute of Chartered Accountants. External appointments Chairman of Ventureprise plc, Oncourse Home Solutions Inc, and Pacifica Group Limited. Previously Chair of Lumon plc and the Association of Foreign Exchange and Payment Companies (AFEP). 10/10 Meetings attended Paula Constant Group Chief Executive Appointed August 2023 With a career spanning over 25 years in the fields of telecoms, banking, and outsourcing, Paula brings a wealth of experience and expertise to the role. Her executive journey includes notable positions at renowned companies such as National Australia Bank, Mitie, BT, Vodafone, Accenture and PE-backed Woven. She has a strong track record of delivering growth through enhancing distribution and improving customer service in B2C and B2B organisations. During her time with BT, she delivered substantial improvements in B2B engineering revenues, in addition to working with the regulator and over 500 customers to significantly reduce delivery lead times and complaints. Skills, personal qualities and capabilities Paula holds a BA in music from Cambridge University. In 2016, she was honoured with a Leader Award from FDM Everywoman in Technology, showcasing her leadership and influence in the industry. 10/10 Meetings attended Maria Darby-Walker Senior Non-Executive Director Appointed June 2019 (Appointed Senior Non-Executive Director in January 2021) Maria joined Personal Group as Non-Executive Director in June 2019 and has Chaired the Remuneration Committee since January 2020. After a career in financial PR and Investor Relations working for a variety of businesses including Barclays and Rolls-Royce, she started her own consultancy in 2005, advising the boards of leading brand names on business-critical issues including mergers and acquisitions, crisis management, brand and reputation, ESG, equality and diversity, and financial regulation. Her client list included: The Financial Conduct Authority, The Investment Association, Unum, Iglo / Birds Eye, Cadbury and Rio Tinto amongst others. Skills, personal qualities and capabilities Beyond her technical and industry qualifications, Maria is also a qualified leadership coach and mentor. She was appointed an honorary visiting fellow of Oxford University’s Corporate Reputation Academy in September 2022. External appointments Senior Independent Non-Executive Director at Redwood Bank Ltd; Non-Executive Director, Ecclesiastical Insurance plc and Trustee, National Park Rescue. 8/10 Meetings attended Committee Membership Key Audit Committee Nominations & SM&CR Committee Remuneration Committee Chair of the Committee Risk and Compliance Committee Independent 38 Personal Group Holdings Plc | Annual Report and Accounts 2024 Bob Head Non-Executive Director Appointed November 2016 Bob joined Personal Group in July 2016. With over 25 years in Non-Executive Director roles, Bob brings an extensive range of knowledge and experience to the Board. His diverse working life has seen him work worldwide with almost every branch of financial services. He also has experience of software and marketing companies as well as government. Skills, personal qualities and capabilities Further to his ACA, ACII and FCIB with an MA from Oxford, Bob has solid blue-chip experience with big brands and business and a rich tapestry of management roles. External appointments Non-Executive Director and Chair of Audit and Remuneration committees at Mirriad. Director at Red Rose Recovery and Vincent House Management. Andy Lothian Non-Executive Director Appointed July 2017 (previously Executive Director, appointed Non-Executive Director in January 2021) Andy Lothian joined Personal Group in 1998 as a Group Account Executive focusing on new business sales and client servicing. His passion for excellence, drive, and commitment has seen him go from strength to strength. His journey at Personal Group has evolved greatly over the last two decades, through Sales Management roles and eventually 11 years as Managing Director of Personal Group Benefits. In January 2021 Andy moved into a Non- Executive Director role on the Board. Skills, personal qualities and capabilities Andy has extensive knowledge and experience of the important day-to-day role that all Personal Group employees play in the development and growth of the business. External appointments Director of Lothian Property Group. Josh Roberts-Jones Head of Finance and Company Secretary Appointed January 2025 Josh has been with Personal Group since 2018, joining the business as a Finance Manager. After becoming Financial Controller in 2020, he was appointed Head of Finance in 2023 and has taken on the appointment of Company Secretary since February 2025. Josh trained as an auditor at KPMG LLP, gaining his professional chartered accountancy qualification with the ICAEW. Having gained valuable experience in a variety of sectors, including financial services, Josh gained industry experience at bpha limited prior to joining Personal Group. Skills, personal qualities and capabilities Josh is a Chartered Accountant and holds a degree in Mathematics with French from Royal Holloway University of London. Josh replaces Damian Kane who, prior to his resignation, attended 9/10 board meetings as Company Secretary. n/a Meetings attended 10/10 Meetings attended Ciaran Astin Non-Executive Director Appointed May 2022 Ciaran is an experienced leader in consumer services businesses across the insurance, telecoms and energy sectors. Ciaran is currently Managing Director of KGM Underwriting Services Ltd, a leading specialist motor insurance MGA. From 2019 to 2023, Ciaran was Managing Director of ClearScore’s Insurance-related business. Between 2012 and 2019, he held senior leadership roles at leading personal lines insurers, Hastings Group and Direct Line Group. Earlier in his career, Ciaran spent two years driving product transformation in Centrica’s consumer business, following seven years in commercial leadership roles in the telecoms sector with BT Group and Telewest. Skills, personal qualities and capabilities Ciaran holds a Masters in Engineering from Cambridge University. 9/10 Meetings attended 10/10 Meetings attended Committee Membership Key Audit Committee Nominations & SM&CR Committee Remuneration Committee Chair of the Committee Risk and Compliance Committee Independent Strategic Report Governance Financial Statements Overview 39 Dear Shareholder I am pleased to present the Risk and Compliance Committee Report for the year ending 31 December 2024. Activity during the year The Committee focuses its debate on key risks, emerging risks, and areas where we perceive we have increased risk. We then assess whether the risk has been optimised. We use the word “optimise” rather than “mitigated” since not all risk can be economically eliminated – for example, the economy. The Committee’s Chair reports formally to the Board on its proceedings after each meeting and during the year the Committee met three times, overseeing significant Group-wide projects which included: • Consideration of the Group’s approach to the challenging economic outlook which persisted throughout 2024, including how to optimise the Group’s current offering and tailor the go to market message to mitigate the risk of any impacts on income from clients and customers. • Reviewing and approving the annual Consumer Duty Board Report, which confirmed that customers are receiving good outcomes and fair value, that the future business strategy is consistent with delivering good outcomes and identifying areas of further enhancement. • Reviewing and approving the bi-annual insurance/fair value update, which included fair value management information (MI) assessment and pricing strategy. • A deep dive into the value in the insurance products underwritten, and sold, by Personal Group companies, reviewing peer-related data, the FCA GI Value Measures data and internal MI. • Update and further development of the Own Risk and Solvency Assessment (ORSA) for Personal Assurance Plc to account for current risks and exposures, particularly in relation to inflationary pressures and negative cost of living effects and strategic risks which have persisted throughout 2024. • Approval of the group’s operational resilience self-assessment, which incorporates cyber risk considerations and business continuity/disaster recovery planning. • Risk oversight of the group’s technological transformation of its insurance IT systems and services, which is designed to allow for a more dynamic approach to affecting policy/ pricing changes throughout the lifecycle of policies, to streamline policy administration, improve customer self- service capability and improve overall customer satisfaction. • Providing risk oversight for the Hapi v2.0/ Saas delivery project, i.e., how it can be “de-risked” to ensure that client and user experiences remain high quality, that resource is used efficiently and effectively and that the current risk position is commonly understood and optimised in a proportionate way. • Consideration of a commissioned external review of the group’s position in the insurance and employee benefits market, taking into account competitor offerings, competitor consolidation in the market and existing client feedback. • Consideration of the group’s proposed approach to managing the business risks associated with the UK Government’s 2024 Budget measures. Risk and Compliance Committee Report The Committee’s role is to assess the effectiveness of the Group’s risk management framework, to set the Group’s risk appetite and to oversee compliance with regulatory requirements. Meetings held 3 Risk and Compliance Committee members Meeting Attendance Bob Head (Chair) 3/3 Martin Bennett 3/3 Maria Darby-Walker 2/3 Andy Lothian 2/3 Ciaran Astin 3/3 Sarah Mace 3/3 Paula Constant 3/3 40 Personal Group Holdings Plc | Annual Report and Accounts 2024 In addition, other work undertaken during the year included: • Ongoing consideration of the Own Risk and Solvency Assessment (ORSA) for Personal Assurance Plc to account for current risks and exposures. • The regular review of the group’s exposure to the risks and threats to the strategic objectives, setting the risk appetites and agreeing tolerances. • The review, consideration and approval of existing Board Group policies. • Consideration of management information which assesses levels of quality and compliance, and the effectiveness of the Information Security Management System. • Consideration of the quality of the sales of the insurance policies, and understanding how artificial intelligence (AI) is used to enhance quality and protect consumers. We are using AI to help assess whether sales are compliant and meet Personal Group standards. • Oversight of the resolution of actions arising from an external review of our health and safety regime. As in previous years, the Committee has continued to apply its mind to the risk logs both in terms of completeness and how risks are optimised. The Committee has also worked closely with the Audit Committee to ensure that the Committees neither duplicate work nor allow things to slip between the gaps. All directors are members of risk committee. We believe the size of Personal Group is such that we get a better result by organising ourselves this way. Bob Head Independent Non-Executive Director 25 March 2025 41 Strategic Report Governance Financial Statements Overview Dear Shareholder The Audit Committee is a key component of the corporate governance framework at Personal Group. Its primary responsibility is to oversee the financial reporting process, ensure the accuracy and integrity of financial statements, and monitor compliance with applicable accounting standards, including International Financial Reporting Standards (IFRS). The Committee also oversees the company’s internal controls and risk management processes. The Committee oversees the appointment of, and relationship with, the external auditor and ensures compliance with other regulatory requirements that are relevant to the Group, as well as gaining reassurance that the control environment is robust and operating effectively. The Committee is also responsible for overseeing the effectiveness of internal audit, currently outsourced to a third-party, in line with the Chartered Institute of Internal Auditors (IIA’s) Guidance on Effective Internal Audit. Roles and Responsibilities The Audit Committee assists the Board in discharging its responsibilities with regard to the oversight of: Financial reporting: • The Group’s annual and interim financial statements, ensuring they are in compliance with applicable accounting standards IFRS and present a true and fair view of the Group’s financial position; • Reviewing and challenging any changes to accounting policies, accounting for significant or unusual transactions and the application of appropriate judgements and estimates; • Considering new accounting standards and pronouncements and comments from the Financial Reporting Council; and • Monitoring the Group’s financial reporting processes, ensuring that financial reports are clear, accurate, and timely. Internal and external audit: • Overseeing the Group’s relationship with its external and internal auditors, including their appointment, remuneration, independence and the effectiveness of the audit processes; and • Monitoring and reviewing the scope of work and effectiveness of the outsourced internal audit function in the context of the Group’s overall risk management system. Internal controls: • Overseeing the Group’s internal control systems to ensure they are effective in safeguarding assets, preventing fraud, and ensuring accurate financial reporting; and • Reviewing the Group’s arrangements with regard to employee/ contractor whistleblowing, fraud detection, prevention of bribery and money-laundering. Audit Committee Report The Audit Committee’s role is to ensure the integrity of financial reporting, robust internal controls, and effective risk management processes, all essential to maintaining investor confidence, regulatory compliance, and good corporate governance. Meetings held 2 Audit Committee members Meeting Attendance Bob Head (Chair) 2/2 Martin Bennett 2/2 Maria Darby-Walker 2/2 Ciaran Astin 2/2 42 Personal Group Holdings Plc | Annual Report and Accounts 2024 Membership and meetings Committee bringing extensive experience in financial reporting, auditing, and governance. The Committee meets at least twice a year. The Directors’ profiles and qualifications are included on pages 38 and 39. Risk matters are covered at the Risk and Compliance Committee but all members of the Audit Committee are also members of the Risk and Compliance Committee, which ensures full co-ordination between the two committees. Two formal meetings were held during 2024 and all Committee members were in attendance. Additionally, the remaining Board members and Company Secretary were present at all meetings. The meetings of the Committee are designed to facilitate and encourage communication among the Committee, the Group’s outsourced internal audit function (RSM) and the appointed external auditor. The Committee meets with the internal auditors and the external auditors, with and without management present, to discuss the results of their examinations, their evaluations of the Group’s internal control and the overall quality of the Group’s financial reporting. In addition, the members of the Audit Committee also meet separately to consider any issues. Activities of the Audit Committee during the year The Committee discussed with the Group’s internal and external auditors the overall scope and plans for their respective audits. As a part of these discussions the Committee has considered whether there are further risk areas that need to be considered in addition to those raised by both sets of auditors. In addition, the key work undertaken by the Committee during the year under review and up to the date of this Annual Report included: • Review and approval of the 2023 Annual Report and Accounts and 2024 Interim Results statement. • Approval of the Solvency and Financial Condition Report. • Review of internal audits carried out by RSM. During 2024 RSM undertook audits, in line with the agreed scope, of areas including financial promotions, assurance frameworks and consumer journeys. The Committee received reports from the internal auditors throughout the year and was satisfied with the effectiveness of internal controls. It supports the recommendations made by the internal auditors and is satisfied with the actions taken or planned by management in response to these recommendations and monitors the resolution of these actions in a timely basis. The Audit Committee regularly discusses the performance of internal audit within the Committee, with management and with internal audit. Given the size of the Group we believe that an outsourced Internal Audit function gives us access to more areas of expertise than an internally resourced department. Significant reporting issues and judgements In fulfilling its oversight responsibilities, the Committee has reviewed and discussed the audited consolidated financial statements and the related schedules within the Annual Report with Group management, including a discussion of the appropriateness of the accounting principles, the reasonableness of significant judgements and the clarity of disclosures in the financial statements. The areas the Audit Committee have focused on are detailed later in the report. Key Group issues included: • Consideration was given to going concern, the adequacy of capital in a variety of scenarios and the ability to pay a dividend whilst maintaining our target of 150% of required regulatory capital. • The carrying value of goodwill in the Group’s financial statements was reviewed as required by IAS36. The Committee reviewed the recommendations of the finance function and received reports from the external auditor on their findings. Where cost effective to do so the Committee has encouraged the external auditors to adopt a controls approach to the audit rather than substantive audit approach. 43 Strategic Report Governance Financial Statements Overview The significant reporting matters and judgements the Committee considered during the year included: Carrying value of goodwill and other intangibles Note 13 & 14 As a result of business acquisitions, the Group has recognised significant balances for goodwill. Goodwill must be tested annually for impairment; other intangible assets are tested when there are indicators that they may be impaired. The assessment of potential impairment requires a number of judgements and estimates to be made in determining the relevant future cash flows and the discount rate to be applied. The Committee reviewed the key financial assumptions underpinning cash flow projections, the discount and long-term growth rates applied thereto and the results of sensitivity analyses. The Committee was satisfied that no impairment was needed on the goodwill of Pay & Reward, and reiterated that the initial assessment of the acquired intangible assets and goodwill was appropriate. The presentation of “Adjusted EBITDA” alongside statutory profit Note 5 Adjusted EBITDA, in this context, looks to adjust for non-underlying trading activity within the financials for year which are material in size, in order to fairly remunerate the management on underlying performance. The Committee considered the approach adopted and was satisfied that the approach continues to help provide a clear and balanced view of the underlying performance of the business than simply focusing on profit after tax. It also concluded that the approach is being applied consistently from year to year and the rationale is clearly presented and reconciled back to the IFRS published numbers. The valuation of the liabilities for incurred claims Note 24 In line with IFRS 17 the Group retains a liability for incurred claims arising from claims in the current and preceding financial years which have not yet given rise to claims paid. It is estimated based on the current information, and the ultimate liability may vary as a result of subsequent information and events. The Committee has reviewed the methodology and calculations relating to the claims provisions held by the insurance entities within the Group to ensure that the incurred but not reported claims reflect not only the historical trends of the insurance policies sold but also continuing impacts such as the current increase in NHS activity. The Committee was satisfied that the amount reserved for across the Group is appropriate given the data available. It should be noted that the insurance business is short tail and post year end claims are examined before the accounts are signed off. External audit EY LLP were first appointed for the 2019 financial year. We value continuity providing the Group gets value for money both for the formal reporting and the third-party assurance that the business has a good control environment. The Committee considers a number of areas when reviewing the external auditor reappointment, namely their performance in discharging the audit, the scope of the audit and terms of engagement, their independence and objectivity, and their reappointment and remuneration. In addition, as noted, we are seeking more value from the audit and encourage a control based approach rather than substantive where it is cost effective to do so. The external auditor reports to the Committee on actions taken to comply with professional and regulatory requirements and is required to rotate the lead audit partner every five years. There is also an active, ongoing dialogue between the Committee and the external auditor on actions to improve the effectiveness and efficiency of the external audit process. In addition, the Committee considers risk areas that might inform the audit strategy and discusses this with the external auditors. The Committee has confirmed it is satisfied with the independence, objectivity and effectiveness of EY LLP as auditor. No non-audit services were provided by the external auditors during this financial year or since they were originally appointed. Bob Head Independent Non-Executive Director 25 March 2025 Audit Committee Report continued 44 Personal Group Holdings Plc | Annual Report and Accounts 2024 Dear Shareholder On behalf of the Board and the Remuneration Committee, I am pleased to present this report for the year ended 31 December 2024. As the committee responsible for overseeing remuneration policies of the Group, our primary aim is to ensure that the remuneration framework is aligned with our long-term strategic objectives and supports the creation of sustainable value for stakeholders. During 2024, the Remuneration Committee has continued to ensure that our executive pay structures support the Group strategy and reflect business performance. We have conducted a thorough review of our remuneration policies and, in line with Principle 9 of the Quoted Companies Alliance (QCA) Code on remuneration, the Committee will put separate advisory resolutions on its remuneration report and remuneration policy to its next AGM. During the course of the year, the main activities of the Committee were: • Approving annual bonus structure and targets for the year to December 2024 • Determining the executive annual bonus outcome for the year to December 2023 • Considering changes to Executive salaries at the outset of the year in line with our normal cycle • Approval of grant of LTIP awards for the Executive Directors and other senior employees in April 2024 • Approval of the grant of CSOP awards across the Group Post year end, the committee has: • Approved annual bonus structure and targets for the year to December 2025 • Determined the executive annual bonus outcome for the year to December 2024 • Reviewed the Remuneration Policy We are committed to ensuring that our approach to remuneration remains competitive, transparent, and in the best interests of our shareholders, while also considering the wider workforce and ensuring fairness across the Group. The Group welcomes dialogue with its shareholders over matters of remuneration. The Chair of the Remuneration Committee is available for contact with investors concerning the approach to remuneration. While there were no specific changes to the executive director remuneration or the wider remuneration policy that Personal Group felt required shareholder consultation, regular communication with shareholders was maintained by the Committee Chair. The Committee considers that the Remuneration Policy has operated as intended. The bonus scheme has also operated as intended, incentivising collective effort across the senior team towards common financial goals as well as bringing individual focus on specific contributions to Group strategic goals. The Committee did not exercise discretion in respect of the LTIPs which vested during the year or on the bonus awards during the year. Role of the Remuneration Committee On behalf of the Board, the Remuneration Committee reviews and determines the pay, benefits and other terms of service of the Company’s Executive Directors and provides support to the Chief Executive, as required, on the remuneration of the wider Senior Leadership Team. The Committee also keeps under review the broad compensation strategy with respect to all other Group employees. Remuneration Committee Report The Committee’s objective is to align our reward strategy with the delivery of profitable and sustainable growth for the benefit of all our stakeholders. Meetings held 4 Remuneration Committee members Meeting Attendance Maria Darby-Walker (Chair) 4/4 Martin Bennett 4/4 Bob Head 4/4 Ciaran Astin 4/4 45 Strategic Report Governance Financial Statements Overview Element Link to remuneration policy / strategy Operation Maximum Opportunity Performance Metric Base Salary To help recruit and retain high performing Executive Directors. Reflects the individual’s experience, role and importance to the business. Base salary is reviewed annually with any changes effective 1 January with reference to each Executive performance and contribution, Group performance, the scope of the Executive Directors’ responsibilities and consideration of competitive pressures. The Committee is guided by the general increase for the broader employee population but has discretion to decide on a lower or a higher increase. The Committee considers individual and Group performance when setting base salary. Benefits To help recruit and retain high performing Executive Directors. To provide market competitive benefits. Executive Directors benefit from car allowances, private medical, health cash plan, travel insurance and life assurance cover. Maximum benefit applies according to the underlying insurance policy and is four times base salary in the case of life assurance. Car allowances are paid in line with market rates. Not applicable. Pension To help recruit and retain high performing Executive Directors. To provide market competitive pensions. Employer’s pension contributions paid in line with the wider employee base. The Group may contribute up to 5% of base salary. None. Annual Bonus To incentivise and reward performance. To align the interests of the Executives and shareholders in the short and medium term. The Annual Bonus is earned by the achievement of one-year performance targets set by the Remuneration Committee. The parameters, performance criteria, weightings and targets are ordinarily set at the start of each financial year. From 2025, awards are subject to malus and clawback provisions. The maximum bonus opportunity for the CEO and CFO is 100% of base salary. Performance measures may include financial, non-financial, personal and strategic objectives. Performance criteria and weightings may be changed from year to year. At present, the performance targets are based on EBITDA, recurring revenue and personal targets, which mirror Group strategic objectives. Remuneration Policy The Group’s remuneration structure has been designed to bring the Group into line with best Remuneration practice and to improve the alignment of senior leadership with shareholder interests. The Committee’s aim, as in previous years, is that the rewards that can be earned provide a competitive level of incentive and are appropriate for a Group of comparable size and complexity at each level of performance. To this end, the Committee considers appropriate strategic goals from time to time which it believes will best ensure delivery of the Group’s short and long term objectives and ensure alignment with stakeholder interests. The table below details the remuneration policy for all elements of fixed and variable pay, including the maximum opportunity available to executives and any relevant performance metrics applied to each element. Remuneration Committee Report continued 46 Personal Group Holdings Plc | Annual Report and Accounts 2024 Element Link to remuneration policy / strategy Operation Maximum Opportunity Performance Metric Long Term Incentive Plan (LTIP) To incentivise and reward long term performance and value creation. To align the interests of Executive Directors and shareholders in the long-term. Executive Directors and selective other senior employees are eligible to receive awards under the LTIP at the discretion of the Committee. Awards are granted as nominal or cost options which vest after three years subject to the meeting of objective performance conditions specified at award. Executive Directors are required to hold vested shares until their shareholding reaches the guideline set out below. LTIP awards are subject to malus and clawback provisions. In accordance with the scheme rules the exceptional maximum award in any financial year is 250% of base salary. The normal policy maximum is 150% of basic salary with a maximum of 200% in exceptional circumstances. Awards in FY24 were set at 150% and 100% of base salary for the CEO and CFO respectively. Performance criteria and weightings may be changed from year to year. For awards made in 2024, 50% of the award was subject to a compounding 3-year TSR target and 50% subject to EBITDA based targets. Share Incentive Plan (SIP) To encourage all employees to make a long-term investment in the Company’s shares in a tax efficient way. The Executive Directors may participate in the SIP on the same terms as other eligible employees. The maximum participation level will be aligned to HMRC limits. None. Company Share Ownership Plan (CSOP) To incentivise and reward retention and value creation. To align the interests of Executive Directors and shareholders in the long-term. CSOPs are awarded at the discretion of the Remuneration Committee but require Executive Directors to have been in tenure for 6 months. Other senior employees are also awarded CSOP options after meeting relevant tenure requirements. The maximum participation level will be aligned to HMRC limits. CSOPs issued from 2024 onwards include EBITDA based performance conditions for the Executive Directors. 47 Strategic Report Governance Financial Statements Overview Element Link to remuneration policy / strategy Operation Maximum Opportunity Performance Metric Shareholding guideline Encourages Executive Directors to achieve the Group’s long term strategy and create sustainable stakeholder value. Aligns with shareholder interests. The shareholding guideline is 100% of salary for the CEO the CFO and 50% of base fees for the Non- Executive Directors. The shareholding requirement is expected to be met within 5 years of the policy adoption date (September 2024) or their appointment date, whichever is later. Not applicable. Not applicable. Non-Executive Director remuneration To provide fees appropriate to time commitments and responsibilities of each role. Non-Executive Directors are paid a base fee in cash. Additional fees are also paid for specific committee roles. Fees are reviewed annually and effective from 1 January each year. In addition, reasonable business expenses may be reimbursed. The Group Board is guided by the general increase for the broader employee population and takes into account relevant market movements. Not applicable. Policy Discretion The Remuneration Committee reserves the right to apply discretion in any and all cases of executive pay, within the remit of good governance and best practice. This includes, but is not limited to, additional remuneration on recruitment (in particular compensation for remuneration forfeited on leaving a previous employer), termination arrangements, LTIP awards and bonus payments. Any discretion exercised in respect of LTIP awards and bonus payments would be within the scope for discretion provided by the plan rules. Remuneration Committee Report continued Employee Remuneration The principles behind the Remuneration Policy for Executive Directors are cascaded down through the Group. They aim to attract and retain the best staff and to focus their remuneration on the delivery of long-term sustainable growth by using a mix of salary, benefits, bonus and longer-term incentives. As a result, no element of the Executive Director Remuneration Policy is operated solely for the purpose of the Executive Directors. Other information Remuneration of the Non-Executive Directors is determined by the Chair and the Executive Directors. They may be paid additional fees in the event that their workloads are significantly in excess of their contractual obligations. The Chair’s remuneration is determined by the Remuneration Committee. The Chair is not entitled to vote on the matter. Contracts and letters of appointment The Executive Directors are employed under rolling service contracts which may be terminated by the Group or the individual giving 6 months’ notice. Non-Executive Directors are retained under Letters of Appointment which may be terminated by either the Group or the individual giving 6 months’ notice, or immediately in the event that the director is not re-elected by shareholders at an AGM or have reached the end of their 3 year appointment without agreement of extension. 48 Personal Group Holdings Plc | Annual Report and Accounts 2024 Remuneration during the year ended 31 December 2024 Directors’ Remuneration The aggregate remuneration payable to the Directors in respect of the period was as follows: Salary Bonus Pension Vested LTIP Other Benefits Total 2024 £000 2023 £000 2024 £000 2023 £000 2024 £000 2023 £000 2024 £000 2023 £000 2024 £000 2023 £000 2024 £000 2023 £000 Executive Directors P Constant 330 137 206 40 19 8 – – 21 9 576 194 S Mace 207 195 130 86 14 15 11 – 20 1 382 297 D Frost – 333 – 15 – 10 – – – 185 – 543 Non-Executive Directors M Bennett 107 103 – – – – – – – – 107 103 R Head 55 52 – – – – – – – – 55 52 A Lothian 44 43 – – – – – – – – 44 43 C Astin 47 45 – – – – – – – – 47 45 M Walker 55 52 – – – – – – – – 55 52 Salaries Effective 1 January 2024, the salary of the Chief Executive was £330,000 and the salary of the Chief Financial Officer was £207,380. Annual bonus The Committee considered the performance of the Executive Directors in the financial year against the criteria of the Annual Bonus Scheme that comprised a 40% element of basic salary based on financial performance and 60% of basic salary on performance against personal objectives. In the financial year the Group achieved revenue and EBITDA results within the range of performance targets (set according to the Group budget for the financial year) and performance against personal targets was scored at 69%. Accordingly, our CEO received a bonus at 62% of maximum and our CFO received a bonus at 63% of maximum. Long term incentives The Group made awards under its LTIP to Executive Directors and other senior employees on 4 April March 2024 subject to three year performance targets for compounding Total Shareholder Return (“TSR”) and EBITDA. 50% of the award vests based on achievement of the TSR objectives and 50% of the award vests based upon achievement of the EBITDA targets. During 2024, 7,492 of 62,438 LTIP options awarded to Sarah Mace in 2021 vested as the performance conditions were partially satisfied. While the EBITDA and TSR vesting thresholds were not met, 12% of the award vested due to satisfaction of ESG conditions. The remaining options have now expired. Details of awards held by Executive Directors under the LTIP and CSOP awards at 31 December 2023 and 31 December 2024 are set out below: Date of Grant No of awards as at 31 Dec 2023 No of awards granted in year Exercise Price (£) Share price at date of grant (£) Earliest exercisable date No of awards as at 31 Dec 2024 LTIP P Constant 04-Aug-23 286,574 0.05 1.88 01-Apr-26 286,574 04-Apr-24 294,643 0.05 1.58 01-Apr-27 294,643 581,217 S Mace 06-Apr-21 62,438 0.05 2.45 01-Apr-24 – 19-Apr-22 84,602 0.05 3.15 01-Apr-25 84,602 20-Jun-23 137,858 0.05 2.17 01-Apr-26 137,858 04-Apr-24 123,440 0.05 1.58 01-Apr-27 123,440 345,900 CSOP P Constant 04-Apr-24 37,151 1.62 1.62 05-Apr-27 37,151 S Mace 27-Jan-14 6,122 4.90 4.90 28-Jan-17 – 19-Jun-23 13,888 2.16 2.16 19-Jun-26 13,888 04-Apr-24 18,575 1.62 1.62 05-Apr-27 18,575 A Lothian 13-Feb-14 6,026 4.98 4.98 14-Feb-17 – * These options partially vested in 2024 as above. ** These options lapsed in the year due to time limitations in line with the rules of the CSOP scheme. 49 Strategic Report Governance Financial Statements Overview Directors’ interests Directors’ Shareholdings as at 31 December 2024 were as follows: 2024 2023 Number of shares % of issued shares Number of shares % of issued shares P Constant 9,998 0.03% – 0.00% S Mace 16,441 0.05% 12,275 0.04% M Bennett 18,070 0.06% 18,070 0.06% R Head – 0.00% – 0.00% A Lothian 37,532 0.12% 37,532 0.12% C Astin 13,883 0.04% – 0.00% M Walker 5,555 0.02% 5,555 0.02% Remuneration for the year ending 31 December 2025 Salaries Executive salaries and Non-Executive Director fees have been reviewed effective 1 January 2025 as laid out below. 2025 2024 P Constant 339,900 330,000 S Mace 213,601 207,380 M Bennett 110,592 107,371 R Head 55,538 54,494 A Lothian 46,538 44,322 C Astin 46,538 46,538 M Walker 55,538 54,494 Annual bonus plan The Annual Bonus Plan applies to both Executive Directors and the SLT. Funding of the bonus pool will only be released if sufficient progress has been made towards the Group’s ESG objectives. Performance targets for 2025 are split as to 40% linked to EBITDA performance and 60% linked to achievement of personal targets set by the Remuneration committee. On target EBITDA performance for the Executive Directors is set at meeting the Group’s budget for the year and results in payment of 65% of the maximum opportunity. The proposed personal objectives for the CEO and CFO for 2025 are focused on delivering ARR and EBITDA growth in key strategic areas, building the Group towards its 5-year strategy and driving efficiencies across the business. Long term incentives The Committee intends to make LTIP awards to its Executive Directors and other senior employees during 2025. These will operate in line with the Group’s policy. Annual General Meeting In line with Principle 9 of the Quoted Companies Alliance (QCA) Code on remuneration, the Committee will voluntarily put separate advisory resolutions on its remuneration report and remuneration policy to its AGM on 8 May 2025. Remuneration Committee Report continued 50 Personal Group Holdings Plc | Annual Report and Accounts 2024 Dear Shareholder The Nominations Committee (the “Committee”) is pleased to present its report for the year ended 31 December 2024. This report provides an overview of the Committee’s activities during the year, the processes followed in relation to board composition, and the nominations put forward for appointment or re-election. Role and Responsibilities of the Nominations Committee The Committee is responsible for: • Reviewing the structure, size, and composition of the Board, including the skills, experience, and diversity required to support the business strategy. • Leading the recruitment process for new directors, including succession planning for the Board and Senior Leadership Team. • Making recommendations for the re- election of directors at the AGM. • Reviewing the performance of individual directors and the Board as a whole. • Provide independent oversight of the Group’s compliance with the Senior Managers and Certification Regime; and • Determine whether employees who are subject to disciplinary procedures have breached the Conduct Rules applicable to their role and whether dismissal is an appropriate outcome. The Nominations Committee, assisted by external executive search agencies as required, primarily manages appointments to the Board, but all Board members have the opportunity to meet shortlisted candidates, ensuring a wide range of feedback in the appointment process. All Executive Directors are engaged on a full-time basis. Non-Executive Directors have letters of appointment stating their annual fee, the minimum required time commitment and confirmation that their appointment is subject to satisfactory performance. Their appointment may be terminated with a maximum of six months’ written notice at any time. Activity during the year The Committee’s Chairman reports formally to the Board on its proceedings after each meeting and during the year the Committee met once, detail of what was reviewed by the Committee is as follows; Board succession We actively manage our Board succession plan, to ensure that our Board has an appropriate and diverse range of skills to enable us to deliver our strategy for the benefit of all of our stakeholders. We are a small and cohesive Board, and take care to ensure that all new members of our Board are aligned to our culture and share our values, whatever their skills and background. Our Board induction process, undertaken by all new members upon appointment, is an important way to get our new Board members up to speed and valued by our Non-Executive Directors. We have a formal plan for how Board membership should develop which aims to balance continuity of service with a regular refreshment of skills and experience needed to deliver our evolving strategy. We regularly review the balance of skills on the Board as a whole, taking account of the future needs of the business, and the knowledge, experience, length of service and performance of the Directors. The Committee is currently engaged in the recruitment of a new Non-Executive Director as a result of the impending retirement of Bob Head from the Personal Group board. We would like to express our appreciation to Bob for his tireless efforts and valuable insight as a member of the board and as Chairman of the Audit and Risk Committees. Nominations Committee Report The objective of the Nominations Committee is to recommend for selection by the full Board, Director nominees and to ensure compliance with the requirements around Senior Managers and Certification Regime (SM&CR). Meetings held 1 Nominations Committee members Meeting Attendance Martin Bennett (Chair) 1/1 Maria Darby-Walker 1/1 Bob Head 1/1 Ciaran Astin 1/1 The Chief Executive, Non-Independent NEDs, Chief People Officer and Company Secretary are normally present at the meetings. 51 Strategic Report Governance Financial Statements Overview Board and Director effectiveness The Chief Executive receives a formal evaluation of their performance during the year, which is conducted by the Chairman. In addition, the Chief Executive discusses with the Non-Executive Directors the performance of individuals of the Executive team and any changes that she proposes to make to this team. Whilst this activity does not take place formally within the meetings of the Nominations Committee, it does form part of its work in overseeing Executive team development and succession process, and the pipeline of talent available for succession to the Board. The performance of our Board and the Committees is evaluated by the Chair. An internal board effectiveness review was conducted in 2024. The evaluation process was conducted via a self-assessment questionnaires with feedback gathered from all directors. The results of the evaluation highlighted several key strengths, including: • Effective performance of Audit and Remuneration Committees and their members. • Robust oversight of management and the development of Group strategy. Areas for improvement were also identified, including enhancing technical and digital expertise and the need to replace the audit and risk expertise that will be lost following the retirement of the audit committee chair. These areas will be addressed through CPD training and a rigorous recruitment process to find a suitable successor. A full external review is scheduled for Q2 2025, with the last external review having taken place in 2022. Diversity We fully support diversity as an important contribution to good quality decision making and innovative thinking. We have on our Board a diversity of gender, skills, experience, personality, and cognitive approach. Across the business, teams are diverse with an even split of males and females in management positions. We are however, mindful of the need to further enhance the diversity of thought, experience, and skills on the Board and Senior Leadership of the Group. This will remain a priority in the coming year. We continue to review how we can further broaden our approach, encouraging diversity and inclusion throughout the Board and the business. Culture and values Our culture is brought to life through our shared values and business principles which the Board monitors through Board reports and agenda items, engagement with employees, and visits to the Group’s offices. Our culture and values are an important part of what we look for in new candidates to join our Board, so that they may promote and engage with the development of these aspects throughout the business. It is important that they are aligned with our values so that they can be role models for all our employees and stakeholders. Certification & conduct rules (SM&CR) It is important for the ongoing success of the business that rigorous certification processes and training and oversight of compliance with the conduct rules are completed and monitored by the Committee. We have worked hard to articulate the conduct rules as part of the wider Group values and have no tolerance for any breaches of the rules. Martin Bennett Independent Non-Executive Chairman 25 March 2025 Tenure and Re-Election of Directors The Nominations Committee considers the length of service of Board members at least annually. The tenure of the Directors is set out below: Member Appointment Board role Last AGM renewal Up for renewal at 2025 AGM Martin Bennett January 2021 Non-Executive Chairman AGM 2023 Paula Constant August 2023 Chief Executive AGM 2024 Sarah Mace October 2020 Chief Financial Officer AGM 2023 Maria Darby-Walker June 2019 Senior Non-Executive Director AGM 2024 Ciaran Astin May 2022 Non-Executive Director AGM 2023 Renewal by rotation Bob Head November 2016 Non-Executive Director AGM 2022 Retiring Andy Lothian July 2017 (previously Executive Director, appointed NED Jan 2021) Non-Executive Director AGM 2024 Nominations Committee Report continued 52 Personal Group Holdings Plc | Annual Report and Accounts 2024 Directors’ Report The Directors present their report together with the audited financial statements for the year ended 31 December 2024. Political contributions Neither the Company nor any of its subsidiaries made any political donation or incurred any political expenditure during the year (2023: £nil). Charitable donations Donations to charitable organisations amounted to £100,000 (2023: £100,000). Principal risks and uncertainties The principal risks and uncertainties facing the Group, along with the risk management objectives and policies are discussed in the Risk and Compliance and Audit Committee reports and Note 3 of these financial statements. Capital requirements See Note 4 of these financial statements. Principal activities The Group is principally engaged in providing employee services, including short-term accident and health insurance, benefits and platform products, pay and reward consultancy and the provision of salary sacrifice technology products in the UK. Results and dividends A review of the year’s results is given in the Chief Financial Officer’s Statement (see page 21). The profit from continuing operations for the year is £6,826,000 (2023: £5,078,000) before taxation of £1,298,000 (2023: £899,000). During the year ordinary dividends of £3,857,000 (2023: £3,482,000) were paid. Directors The membership of the Board at the end of the year is set out in the Remuneration Report on pages 45 to 50. The Remuneration Committee Report also includes details of the Directors’ remuneration and interests in the ordinary shares of the Company. During the year all Directors and officers were covered by third party indemnity insurance. Corporate governance The Board of Personal Group Holdings Plc supports the principles and is committed to achieving high standards of corporate governance and has adopted the Quoted Companies Alliance Corporate Governance Code in its entirety. The Board’s report on the Group’s corporate governance procedures is set out on pages 36 and 37. Disclosure of information to auditor The Directors who held office at the date of approval of this Directors’ Report confirm that, so far as they are each aware, there is no relevant audit information of which the Group’s auditor is unaware; and each Director has taken all the steps that they ought to have taken as a Director to make themselves aware of any relevant audit information and to establish that the Group’s auditor is aware of that information. Auditor EY LLP have expressed willingness to continue in office. In accordance with section 489 (4) of the Companies Act 2006 a resolution to both formally appoint and reappoint EY LLP will be proposed at the Annual General Meeting to be held on Thursday 8 May 2025. Other information An indication of likely future developments in the business and particulars of significant events which have occurred since the end of the financial year have been included in the Strategic Report. BY ORDER OF THE BOARD Sarah Mace Chief Financial Officer 25 March 2025 53 Strategic Report Governance Financial Statements Overview Statement of Directors’ Responsibilities The Directors are responsible for preparing the Strategic report, Directors’ report and the Group and parent company financial statements in accordance with applicable law and regulations. 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 parent Company and of their profit or loss for that period. In preparing each of the Group and parent Company financial statements, the Directors are required to: • Select suitable accounting policies and then apply them consistently. • Make judgements and estimates that are reasonable, relevant and reliable. • State whether they have been prepared in accordance with UK adopted IFRS. • Assess the Group and parent Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern. • Use the going concern basis of accounting unless they either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so. In respect of the Strategic Report, Directors’ Report and the Financial Statements The Directors are responsible for preparing the Strategic Report, Directors’ Report and the Group and parent Company Financial Statements in accordance with applicable law and regulations. Company law requires the Directors to prepare Group and parent Company financial statements for each financial year. Under the AIM Rules of the London Stock Exchange they are required to prepare the Group financial statements in accordance with International Financial Reporting Standards as adopted by the UK (UK adopted IFRS) and applicable law and they have elected to prepare the parent Company financial statements on the same basis. The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the parent Company’s transactions and disclose with reasonable accuracy at any time the financial position of the parent Company and enable them to ensure that its financial statements comply with the Companies Act 2006. They are responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and other irregularities. Under applicable law and regulations, the Directors are also responsible for preparing a Strategic Report and a Directors’ Report that complies with that law and those regulations. The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. 54 Personal Group Holdings Plc | Annual Report and Accounts 2024 Independent Auditor’s Report to the Members of Personal Group Holdings Plc Opinion In our opinion: • Personal Group Holdings Plc’s group financial statements and parent company financial statements (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 December 2024 and of the group’s profit 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 UK adopted international accounting standards as applied in accordance with section 408 of the Companies Act; and • the financial statements have been prepared in accordance with the requirements of the Companies Act 2006. We have audited the financial statements of Personal Group Holdings Plc (the ‘parent company’) and its subsidiaries (the ‘group’) for the year ended 31 December 2024 which comprise: Group Parent company Consolidated balance sheet as at 31 December 2024 Balance sheet as at 31 December 2024 Consolidated income statement for the year then ended Statement of changes in equity for the year then ended Consolidated statement of changes in equity for the year then ended Cash flow statement for the year then ended Consolidated cash flow statement for the year then ended Related notes 1 to 32 to the financial statements including material accounting policy information (excluding the component of Note 4 which is marked as unaudited) Related notes 1 to 32 to the financial statements, including material accounting policy information (excluding the component of Note 4 which is marked as unaudited) The financial reporting framework that has been applied in their preparation is applicable law and UK adopted international accounting standards and as regards to the parent company financial statements, as applied in accordance with section 408 of the Companies Act 2006. Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the group and 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 as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Conclusions relating to going concern In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors’ assessment of the group and parent company’s ability to continue to adopt the going concern basis of accounting included the following procedures: • confirming our understanding of management’s going concern assessment process and obtained management’s assessment which covers the period to 26 March 2026; • obtaining the financial forecasts prepared by the Group and assessed the appropriateness of assumptions applied in the financial forecasts and in modelled stress scenarios based on our understanding of the business and the Group’s historical performance; • performing enquiries of management and those charged with governance to identify risks or events that may impact the Group’s ability to continue as a going concern. We also reviewed management’s assessment approved by the Board, minutes of meetings of the Board and its committees, and made enquiries as to the impact of market conditions on the business; and • assessing the appropriateness of the going concern disclosures by comparing the consistency with management’s assessment and for compliance with the relevant reporting requirements. Based on management’s assessment, we have observed that the Group is able to continue to have surplus cash and solvency above the solvency requirements within its two regulated entities in a number of extreme downside scenarios and the Group will be able to continue to service customers and meet its commitments in the current environment. 55 Strategic Report Overview Governance Financial Statements Independent Auditor’s Report continued 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 and parent company’s ability to continue as a going concern for the period to 26 March 2026. Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the group’s ability to continue as a going concern. Overview of our audit approach Audit scope • We performed an audit of the complete financial information of 7 components and audit procedures on specific balances for a further 4 components and central procedures on all group accounts, with the exception of specific balances for which we instructed EY Guernsey to audit. • We performed full and specific scope procedures for all audit areas except those as outlined in the tailoring the scope section. Key audit matters • Valuation of goodwill relating to the pay and reward CGU (Innecto and QCG) • Capitalisation of software development costs as intangible assets (PAS) Materiality • Overall group materiality of 341,000 which represents 5% of Group profit before tax adjusted for the non-recurring nature of the disposal of Lets Connect. An overview of the scope of the parent company and group audits Tailoring the scope In the current year our audit scoping has been updated to reflect the new requirements of ISA (UK) 600 (Revised). We have followed a risk-based approach when developing our audit approach to obtain sufficient appropriate audit evidence on which to base our audit opinion. We performed risk assessment procedures, with input from our component auditors, to identify and assess risks of material misstatement of the Group financial statements and identified significant accounts and disclosures. When identifying components at which audit work needed to be performed to respond to the identified risks of material misstatement of the Group financial statements, we considered our understanding of the Group and its business environment, the potential impact of climate change, the applicable financial framework, the Group’s system of internal control at the entity level, the existence of centralised processes, applications and any relevant internal audit results. We identified ten components (detailed below) as individually relevant components to the Group. These were due to relevant events and conditions underlying the identified risks of material misstatement of the Group financial statements being associated with the reporting components or a pervasive risk of material misstatement of the Group financial statements or a significant risk or an area of higher assessed risk of material misstatement of the Group financial statements being associated with the components. For those individually relevant components, we identified the significant accounts where audit work needed to be performed at these components by applying professional judgement, having considered the Group significant accounts on which full scope and specific scope procedures will be performed, the reasons for identifying the financial reporting component as an individually relevant component and the size of the component’s account balance relative to the Group significant financial statement account balance. 56 Personal Group Holdings Plc | Annual Report and Accounts 2024 We, as the primary team, performed full scope and specific scope procedures for the following entities: • Personal Group Holdings Plc (full scope) • Personal Assurance Plc (full scope) • Personal Group Limited (full scope) • Personal Management Solutions Limited (full scope) • Personal Assurance Services Limited (full scope) • Let’s Connect IT Solutions Limited (specific scope) • Innecto People Consulting Limited (full scope) • Berkeley Morgan Limited (specific scope) • Quintige Consulting Group Limited (specific scope) Procedures for Personal Assurance Guernsey Limited, a full scope component, were performed by both the primary team and EY Guernsey. We then considered whether the remaining group significant account balances not yet subject to audit procedures, in aggregate, could give rise to a risk of material misstatement of the group financial statements. We selected Personal Group Benefits Ltd to include in our audit scope to address these risks. Our scoping to address the risk of material misstatement for each key audit matter is set out in the Key Audit Matters section of our report. Involvement with component teams In establishing our overall approach to the Group audit, we determined the type of work that needed to be undertaken at each of the components by us, as the Group audit engagement team, or by component auditors from other EY global network firms operating under our instruction. Of the scoped-in components, audit procedures were performed on six full scope and four specific scope components directly by the primary audit team, whilst for the other full scope component (Personal Assurance (Guernsey) Limited) audit procedures were performed by both the primary audit team and the component audit team, EY Guernsey. The Group audit team interacted regularly with the component team where appropriate during various stages of the audit, reviewed relevant working papers and were responsible for the scope and direction of the audit process. This, together with the additional procedures performed at Group level, gave us appropriate evidence for our opinion on the Group financial statements. Climate change Stakeholders are increasingly interested in how climate change will impact Personal Group Holdings Plc. The Group has explained their climate targets on pages 29 to 32 of Environmental, Social and Governance disclosures. These disclosures form part of the “Other information,” rather than the audited financial statements. Our procedures on these unaudited disclosures therefore consisted solely of considering whether they are materially inconsistent with the financial statements, or our knowledge obtained in the course of the audit or otherwise appear to be materially misstated, in line with our responsibilities on “Other information”. In planning and performing our audit we assessed the potential impacts of climate change on the Group’s business and any consequential material impact on its financial statements. The Group has explained in the Basis of preparation note that they have concluded that the physical and transition risks of climate change do not have a material impact on the recognition and measurement of the assets and liabilities in these financial statements. This is because the assets are reported at fair value under UK adopted international accounting standards. Our audit effort in considering the impact of climate change on the financial statements was focused on evaluating management’s assessment of the impact of climate risk, physical and transition, and their climate commitments. As part of this evaluation, we performed our own risk assessment to determine the risks of material misstatement in the financial statements from climate change which needed to be considered in our audit. We also challenged the Directors’ considerations of climate change risks in their assessment of going concern and associated disclosures. Based on our work we have not identified the impact of climate change on the financial statements to be a key audit matter or to impact a key audit matter. 57 Strategic Report Overview Governance Financial Statements Independent Auditor’s Report continued Key Audit Matters Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in our opinion thereon, and we do not provide a separate opinion on these matters. Risk Our response to the risk Valuation of Goodwill relating to the Pay and Reward cash generating unit (“CGU”) (Innecto and QCG) (2024: £2.68m, 2023: £2.68m) Refer to Accounting policies (page 75); and Note 13 of the Consolidated Financial Statements (pages 89-90) Innecto was acquired by PGH in 2019, and QCG in 2022. Both businesses are treated as one CGU due to the commonality of their business models, cash flows and management team. As at 31 December 2024 we noted that the value of the Pay and Reward goodwill was sensitive to the discount rate and the short-term growth rates of digital sales. The forecasted cash flows are dependent on the continued projected growth from digital and consultancy income. Current 2024 forecasts show a more positive outlook for the CGU, but due to economic uncertainty and inflationary pressures this may impact the CGU’s ability to generate new business and maintain its cost base, which in turn leads to uncertainty around future cash flows and a heightened sensitivity to the applied discount rate. The identified key assumptions involve significant judgement about future events for which small changes can result in a material impact to the resultant valuation and therefore leads to a greater risk of material misstatement. The risk has remained unchanged from prior year. To obtain sufficient and appropriate evidence to conclude on the valuation of goodwill at the year end, we performed the following procedures: • Examined and assessed the appropriateness of management’s impairment model, including an identification of the CGU and attributable cashflows, an assessment of discounted cash flows, and understanding of the significant assumptions used in the impairment test for the identified CGU; • Considered the increased uncertainty in the underlying forecasts and challenged the future cash flow projections of the CGU, including the appropriateness of the applied short-term and long-term growth rates and estimated conversion rates; • Challenged the future cash flow projections of the CGU to ensure pipeline business and conversion rates included in the projections are appropriate by comparing to prior year accuracy of forecasting and applying sensitivity analysis; • Engaged our valuation specialists to assess methodologies and assumptions used in the analysis including the reasonableness of the discount rate by considering the CGU’s specific circumstances as well as those of comparable companies; • Performed sensitivity analysis to assess the impact of certain key variables on levels of headroom, including discount rate and growth assumptions; and • Considered whether the applied accounting treatment is in compliance with IFRS and the Group’s accounting policy, and the Group disclosures are in line with the required reporting framework. Key observations communicated to the Audit Committee We conclude that the carrying value of the goodwill is not materially misstated as there is sufficient headroom at 31 December 2024 under a reasonable range of scenarios, therefore no impairment is required. We have reviewed the related disclosures and concluded that these appropriately reflect the uncertainty associated with the future cash flows of the Pay and Reward CGU, as well as the sensitivities and key assumptions. How we scoped our audit to respond to the risk Goodwill arises solely on consolidation and as such the audit work to address this risk was performed by the primary audit team. 58 Personal Group Holdings Plc | Annual Report and Accounts 2024 Risk Our response to the risk Capitalisation of Computer Software and Website Development Costs as Intangible Assets (2024: £4.41m, 2023: £0.44m) Refer to Accounting policies (page 77); and Note 14 of the Consolidated Financial Statements (pages 91-92) Costs relating to the development of the HAPI v2 software, incurred in Personal Assurance Services Limited (PAS), have been capitalised as computer software during the year. In the prior year, this was held as work in progress (WIP). There is a risk that costs may have been capitalised prematurely or inappropriately, without having met the criteria set out in accounting standards, IAS 38 Intangible Assets. Inappropriate capitalisation could lead to a material misstatement through overstatement of the company’s assets and net income. The risk is newly identified in the current year due to the significant growth in the intangible asset in the year. As part of our audit procedures, we performed the following: • Examine the company’s accounting policies for capitalisation of intangible assets to ensure they are in line with IAS 38; • Evaluate whether the policies have been consistently applied; • Assessed whether the recognition criteria set out in IAS 38 Intangible Assets had been met, such as identifiability, control over a resource, and the existence of future economic benefits; • Tested that costs are capitalised only when it is probable that the expected future economic benefits will flow to the entity; • Reviewed the nature, existence and accuracy of the costs incurred to determine if they meet the criteria for capitalisation (e.g., development costs vs. research costs); • Assessed the methods used for valuing intangible assets and test for impairment; • Reviewed cash flow projections and other valuation models used to determine if the intangible assets were carried at more than their recoverable amount; • Assessed the amortisation methods and useful lives assigned to intangible assets to ensure they are reasonable and consistent with the assets’ expected patterns of economic benefits; • Perform substantive testing on significant intangible asset additions to ensure they were properly authorised, recorded, and supported by appropriate documentation; and • Reviewed financial statement disclosures related to intangible assets to ensure they are complete, accurate, and in accordance with the relevant accounting standards. Key observations communicated to the Audit Committee We conclude that the Capitalisation of Computer Software and Website Development Costs recorded during the period are in line with IAS 38 Intangible Assets and are fairly stated. How we scoped our audit to respond to the risk Computer software and website development costs originate in Personal Assurance Services Limited and consolidates into Personal Group Holdings Plc, all audit work performed to address this risk was undertaken by the primary audit team. In the prior year, our auditor’s report included a key audit matter in relation to the Transition to IFRS 17. In the current year, this has been removed as the transition was a one-off event. 59 Strategic Report Overview Governance Financial Statements Independent Auditor’s Report continued Our application of materiality We apply the concept of materiality in planning and performing the audit, in evaluating the effect of identified misstatements on the audit and in forming our audit opinion. Materiality The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably be expected to influence the economic decisions of the users of the financial statements. Materiality provides a basis for determining the nature and extent of our audit procedures. We determined materiality for the Group to be £341,000 (2023: £266,700), which is 5% (2023: 5%) of profit before tax from continuing operations, adjusted for the profit on the sale of Let’s Connect. We believe the focus of the shareholders to be the Group’s underlying profitability and earnings per share. We consider that it remains the most appropriate basis to determine materiality for the Group. We determined materiality for the Parent Company to be £255,000 (2023: £258,940), which is 1% (2023: 1%) of the Parent Company equity. We have used the capital-based measure for determining materiality due to the Parent Company being a holding company. For the Group audit purposes, we performed our audit procedures to the lower of the Parent Company and the Group allocated performance materiality. Starting basic • Profit before Tax £7.7m • Based on 31 December 2024 Adjustments • Adjustments related to the disposal of Lets Connect to reflect the non-recurring nature of the transaction – £(0.9)m Materiality • Totals £6.8m materiality basis • Materiality of £341K (5% of materiality basis) During the course of our audit, we reassessed initial materiality and the change in final materiality from our original assessment at planning is due to the difference between the actual profit before tax as compared to forecasted profit before tax. Performance materiality The application of materiality at the individual account or balance level. It is set at an amount to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality. On the basis of our risk assessments, together with our assessment of the Group’s overall control environment, our judgement was that performance materiality was 75% (2023: 75%) of our planning materiality, namely £255,750 (2023: £200,030). We have set performance materiality at this percentage because our prior year audit experience indicates a lower risk of misstatements. Our assessment of the restatement of the cash and cash equivalents concluded that this is non-recurring in nature and not indicative of a pervasive weakness in the control environment. Audit work was undertaken at component locations for the purpose of responding to the assessed risks of material misstatement of the Group financial statements. The performance materiality set for each component is based on the relative scale and risk of the component to the Group as a whole and our assessment of the risk of misstatement at that component. In the current year, the range of performance materiality allocated to components was £49,950 to £199,800 (2023: £30,000 to £200,025). Reporting threshold An amount below which identified misstatements are considered as being clearly trivial. We agreed with the Audit Committee that we would report to them all uncorrected audit differences in excess of £17,050 (2023: £13,335), which is set at 5% of planning materiality, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds. We evaluate any uncorrected misstatements against both the quantitative measures of materiality discussed above and in light of other relevant qualitative considerations in forming our opinion. Other information The other information comprises the information included in the annual report set out on pages 1 to 54, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in this report, we do not express any form of assurance conclusion thereon. 60 Personal Group Holdings Plc | Annual Report and Accounts 2024 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 the other information, we are required to report that fact. We have nothing to report in this regard. Opinions on other matters prescribed by the Companies Act 2006 In our opinion, based on the work undertaken in the course of 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 directors’ report have been prepared in accordance with applicable legal requirements. Matters on which we are required to report by exception 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 directors’ responsibilities statement set out on page 54, 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 and 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. Explanation as to what extent the audit was considered 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 irregularities, including fraud. 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 or intentional misrepresentations, or through collusion. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below. 61 Strategic Report Overview Governance Financial Statements However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the Group and management. • We obtained an understanding of the legal and regulatory frameworks that are applicable to the Group and determined that the most significant are those that relate to the reporting framework (UK adopted international accounting standards and the Companies Act 2006) and the relevant direct tax regulation in the UK. In addition, the Company is required to comply with laws and regulations relating to its operations, including health and safety, employees, anti-bribery and corruption and General Data Protection Regulation (‘GDPR’). Our considerations of other laws and regulations that may have a material effect on the financial statements included permissions and supervisory requirements of the Prudential Regulation Authority (‘PRA’), the Financial Conduct Authority (‘FCA’) and the Guernsey Financial Services Commission (‘GFSC’). • We understood how the Personal Group Holdings Plc is complying with those frameworks by making inquiries with those charged with governance, internal audit and management to understand how the Company maintains and communicates its policies and procedures in these areas and corroborated this by reviewing supporting documentation. We also reviewed correspondence with relevant authorities. • We assessed the susceptibility of the Group’s financial statements to material misstatement, including how fraud might occur by considering the controls that the Company has established to address the risks identified by the entity and to prevent or detect fraud. Where fraud risk, including the risk of management override, was considered to be higher, we performed audit procedures to address each identified risk. These procedures included: • Reviewing estimates for evidence of management bias. Supported by our valuation specialists, we assessed if there were any indicators of management bias in the valuation of goodwill. • Testing the appropriateness of a sample of revenue transactions for the year ended 31 December 2024 including revenue earned around the cut-off date. • Testing the appropriateness of the capitalisation of computer software and website development costs as intangible assets to ensure this is in line with the requirements of IAS 38. • We evaluated the appropriateness of journal entries recorded in the general ledger, with a focus on manual journals, and evaluated the business rationale for significant and/or unusual transactions. • Based on this understanding we designed our audit procedures to identify non- compliance with such laws and regulations. For direct laws and regulations, we considered the extent of compliance with those laws and regulations as part of our procedures on the related financial statement items. For both direct and other laws and regulations, our procedures involved making enquiry of those charged with governance, management and internal audit for their awareness of any non-compliance of laws and regulations, inquiring about the policies that have been established to prevent non- compliance with laws and regulations by officers and employees, inquiring about the Company’s method of enforcing and monitoring compliance with such policies and inspecting significant correspondence with the FCA, PRA and GFSC. • The Group operates in the insurance industry which is a highly regulated environment. As such, the Senior Statutory Auditor considered the experience and expertise of the engagement team to ensure that the team had the appropriate competence and capabilities, which included the use of specialists where appropriate. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at https://www.frc.org.uk/ auditorsresponsibilities. This description forms part of our auditor’s report. Use of our report This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed. Ben Morphet (Senior statutory auditor) for and on behalf of Ernst & Young LLP, Statutory Auditor Birmingham 25 March 2025 Independent Auditor’s Report continued 62 Personal Group Holdings Plc | Annual Report and Accounts 2024 Note 2024 £’000 Restated 2023 £’000 Insurance revenue 32,166 28,708 Benefits and reward revenue 10,277 8,931 Other income 136 139 Investment income 6 1,197 807 Revenue 5 43,776 38,585 Insurance service expenses 7 (16,915) (14,593) Net expenses from reinsurance contracts held 7 (79) (135) Benefits and reward expenses 5 (7,810) (7,362) Other expenses (73) (94) Group administration expenses (11,788) (11,159) Share based payment expenses (202) (169) Unrealised gains on equity investments 123 181 Charitable donations (100) (100) Expenses (36,844) (33,431) Results of operating activities 6,932 5,154 Finance costs (106) (76) Profit before tax from Continuing Operations 6,826 5,078 Taxation 10 (1,298) (899) Profit for the year from Continuing Operations 5,528 4,179 Discontinued Operations Gain on disposal of Let’s Connect 28 1,167 – Other owned benefits revenues 2,572 11,081 Other owned benefits costs (2,837) (10,825) Taxation on Discontinued Operations 66 (111) (Loss)/profit for the year from Discontinued Operations 968 145 Profit for the year 6,496 4,324 * Following the Group’s disposal of its entire issued share capital of Let’s Connect on 09 July 2024, Let’s Connect has been classified as a discontinued operation, and the prior- year comparative figures have been restated accordingly in line with IFRS 5: Non-current Assets Held for Sale and Discontinued Operations. See Note 28 for further details. Consolidated Income Statement for the year ended 31 December 2024 There is no other comprehensive income for the year and, as a result, no statement of comprehensive income has been produced. The accompanying policies and notes form an integral part of these financial statements. 63 Strategic Report Overview Governance Financial Statements The profit for the year is attributable to equity holders of Personal Group Holdings Plc. Basic EPS Pence Pence From Continuing Operations 11 17.7 13.4 From Discontinued Operations 11 3.1 0.4 Total Basic EPS 20.8 13.8 Diluted EPS Pence Pence From Continuing Operations 11 17.1 13.1 From Discontinued Operations 11 3.0 0.4 Total Diluted EPS 20.1 13.5 Consolidated Income Statement continued 64 Personal Group Holdings Plc | Annual Report and Accounts 2024 Note 2024 £’000 Restated 2023 £’000 ASSETS Non-current assets Goodwill 13 2,684 2,684 Intangible assets 14 4,854 3,654 Property, plant and equipment 15 4,479 5,020 12,017 11,358 Current assets Financial assets 16 9,912 6,961 Trade and other receivables 18 9,994 16,015 Inventories 17 – 272 Cash and cash equivalents 19 19,060 14,571 Current tax assets 304 12 39,270 37,831 Total assets 51,287 49,189 * Financial assets and cash and cash equivalents have been restated. For further details, please see Note 30. Consolidated Balance Sheet at 31 December 2024 65 Strategic Report Overview Governance Financial Statements Note 2024 £’000 Restated 2023 £’000 EQUITY Equity attributable to equity holders of Personal Group Holdings Plc Share capital 20 1,562 1,562 Share premium 20 1,134 1,134 Capital redemption reserve 24 24 Share based payments reserve 495 513 Other reserve (27) (36) Profit and loss reserve 31,652 28,798 Total equity 34,840 31,995 LIABILITIES Non-current liabilities Deferred tax liabilities 21 1,158 790 Trade and other payables 22 343 567 1,501 1,357 Current liabilities Trade and other payables 22 14,052 15,100 Reinsurance contracts held 5 2 Insurance contract liabilities 23 889 735 14,946 15,837 Total liabilities 16,447 17,194 Total equity and liabilities 51,287 49,189 The financial statements were approved by the Board on 25 March 2025. S Mace P Brown (née Constant) Chief Financial Officer Chief Executive Company number: 3194991 The accompanying accounting policies and notes form an integral part of these financial statements. Consolidated Balance Sheet continued 66 Personal Group Holdings Plc | Annual Report and Accounts 2024 Company Balance Sheet at 31 December 2024 2024 2023 Note £’000 £’000 ASSETS Non-current assets Investment in subsidiary undertakings 24 25,798 25,620 25,798 25,620 Current assets Financial assets 16 4,750 – Trade and other receivables 18 331 803 Cash and cash equivalents 19 37 50 5,118 853 Total assets 30,916 26,473 EQUITY Equity attributable to equity holders of Personal Group Holdings Plc Share capital 20 1,562 1,562 Share premium 20 1,134 1,134 Capital redemption reserve 24 24 Share based payment reserve 495 575 Other reserve (27) (36) Profit and loss reserve 22,374 22,635 Total equity 25,562 25,894 LIABILITIES Current liabilities Trade and other payables 22 5,354 579 Total liabilities 5,354 579 Total equity and liabilities 30,916 26,473 The parent Company has taken advantage of section 408 of the Companies Act 2006 and has not included its own profit and loss account in these financial statements. The parent Company’s profit for the year was £3,343,000 (2023: £3,913,000). The financial statements were approved by the Board on 25 March 2025. S Mace P Brown (née Constant) Chief Financial Officer Chief Executive Company number: 3194991 The accompanying accounting policies and notes form an integral part of these financial statements. 67 Strategic Report Overview Governance Financial Statements Equity attributable to equity holders of Personal Group Holdings Plc Share capital £’000 Capital redemption reserve £’000 Share premium £’000 Share based payment reserve £’000 Other reserve £’000 Profit and loss reserve £’000 Total equity £’000 Balance as at 1 January 2024 1,562 24 1,134 513 (36) 28,798 31,995 Dividends paid – – – – – (3,857) (3,857) Employee share-based compensation – – – 178 – 24 202 Proceeds of SIP share sales – – – – – 86 86 Cost of SIP shares sold – – – – 91 (91) – Cost of SIP shares purchased – – – – (82) – (82) Clearance of SBP Reserve for Lapsed Options – – – (196) – 196 – Transactions with owners – – – (18) 9 (3,642) (3,651) Profit for the year - - - - - 6,496 6,496 Balance as at 31 December 2024 1,562 24 1,134 495 (27) 31,652 34,840 Balance as at 1 January 2023 1,562 24 1,134 367 (55) 27,946 30,978 Dividends paid – – – – – (3,482) (3,482) Employee share-based compensation – – – 146 – 23 169 Proceeds of SIP share sales – – – – – 22 22 Cost of SIP shares sold – – – – 35 (35) – Cost of SIP shares purchased – – – – (16) – (16) Transactions with owners – – – 146 19 (3,472) (3,307) Profit for the year – – – – – 4,324 4,324 Balance as at 31 December 2023 1,562 24 1,134 513 (36) 28,798 31,995 * PG Share Ownership Plan (SIP). The accompanying accounting policies and notes form an integral part of these financial statements. Consolidated Statement of Changes in Equity for the year ended 31 December 2024 68 Personal Group Holdings Plc | Annual Report and Accounts 2024 Company Statement of Changes in Equity for the year ended 31 December 2024 Equity attributable to equity holders of Personal Group Holdings Plc Capital redemption Share based Profit and loss Share capital reserve Share premium payment reserve Other reserve reserve Total equity £’000 £’000 £’000 £’000 £’000 £’000 £’000 Balance as at 1 January 2024 1,562 24 1,134 575 (36) 22,635 25,894 Dividends paid – – – – – (3,857) (3,857) Employee share-based compensation – – – 178 – – 178 Proceeds of SIP share sales – – – – – 86 86 Cost of SIP shares sold – – – – 91 (91) – Cost of SIP shares purchased – – – – (82) – (82) Clearance of SBP Reserve for Lapsed Options – – – (258) – 258 – Transactions with owners – – – (80) 9 (3,604) (3,675) Profit for the year – – – – – 3,343 3,343 Balance as at 31 December 2024 1,562 24 1,134 495 (27) 22,374 25,562 Balance as at 1 January 2023 1,562 24 1,134 429 (55) 22,217 25,311 Dividends paid – – – – – (3,482) (3,482) Employee share-based compensation – – – 146 – – 146 Proceeds of SIP* share sales – – – – – 22 22 Cost of SIP shares sold – – – – 35 (35) – Cost of SIP shares purchased – – – – (16) – (16) Transactions with owners – – – 146 19 (3,495) (3,330) Profit for the year – – – – – 3,913 3,913 Balance as at 31 December 2023 1,562 24 1,134 575 (36) 22,635 25,894 * PG Share Ownership Plan (SIP). The accompanying accounting policies and notes form an integral part of these financial statements. 69 Strategic Report Overview Governance Financial Statements Consolidated Cash Flow Statement The accompanying accounting policies and notes form an integral part of these financial statements. The Group presents the information required by IFRS 5 in the notes to the financial statements with no analysis of continuing and discontinued operations on the face of the statement of cash flows. For more information, see Note 28. Note 2024 £’000 Restated 2023 £’000 Net cash from operating activities (see next page) 11,441 6,678 Investing activities Additions to property, plant and equipment 15 (103) (157) Additions to intangible assets 14 (2,665) (2,040) Proceeds from disposal of property, plant and equipment 74 78 Purchases of financial assets (2,828) (3,749) Interest received 1,197 807 Proceeds from disposal of Let’s Connect 6 1,840 – Net cash from investing activities (2,485) (5,061) Financing activities Interest paid – (1) Purchase of own shares by the SIP (81) (16) Proceeds from disposal of own shares by the SIP 85 25 Payment of lease liabilities 29 (614) (530) Dividends paid 12 (3,857) (3,482) Net cash used in financing activities (4,467) (4,004) Net change in cash and cash equivalents 4,489 (2,387) Cash and cash equivalents, beginning of year 19 14,571 16,958 Cash and cash equivalents, end of year 19 19,060 14,571 * PG Share Ownership Plan (SIP). ** 2023 has been restated to reflect the additional purchases of financial assets (£2,926k) in the year, with the corresponding impact reducing the closing cash position by this amount as at 31 December 2023. For more information on this, please see Note 30. 70 Personal Group Holdings Plc | Annual Report and Accounts 2024 Note 2024 £’000 Restated 2023 £’000 Operating activities Profit after tax 6,496 4,324 Adjustments for Depreciation 15 1,145 1,135 Amortisation of intangible assets 14 1,429 770 Goodwill impairment 13 – – Profit on disposal of property, plant and equipment (9) 8 Profit on disposal of discontinued operations (1,167) – Realised and unrealised investment (gains)/losses (123) (181) Interest received (1,197) (807) Interest charge 106 79 Share-based payment expenses 202 169 Taxation expense recognised in income statement 10 1,232 1,010 Changes in working capital Trade and other receivables 5,106 (2,569) Trade and other payables (839) 3,247 Movement in insurance liabilities 154 (275) Inventories 52 454 Taxes paid (1,146) (686) Net cash from operating activities 11,441 6,678 * PG Share Ownership Plan (SIP). ** 2023 has been restated to reflect the additional purchases of financial assets (£2,926k) in the year, with the corresponding impact reducing the closing cash position by this amount as at 31 December 2023. For more information on this, please see Note 30. The accompanying accounting policies and notes form an integral part of these financial statements. The Group presents the information required by IFRS 5 in the notes to the financial statements with no analysis of continuing and discontinued operations on the face of the statement of cash flows. For more information, see Note 28. 71 Strategic Report Overview Governance Financial Statements Personal Group Holdings Plc | Annual Report and Accounts 2024 72 Company Cash Flow Statement 2024 2023 Note £’000 £’000 Net cash from operating activities (see below) 4,840 (1,012) Investing activities Purchase of financial assets (4,750) – Dividends received 3,750 4,300 Net cash used in investing activities 1,000 4,300 Financing activities Purchase of own shares by the SIP (81) (16) Proceeds from disposal of own shares by the SIP 85 25 Dividends paid 12 (3,857) (3,482) Net cash used in financing activities (3,853) (3,473) Net change in cash and cash equivalents (13) (187) Cash and cash equivalents, beginning of year 19 50 237 Cash and cash equivalents, end of year 19 37 50 Operating activities Profit after tax 3,278 3,913 Changes in working capital Trade and other receivables 472 (482) Trade and other payables 4,840 (143) Dividends received (3,750) (4,300) Net cash from operating activities 4,840 (1,012) * PG Share Ownership Plan (SIP). The parent Company has cash and cash equivalents at 31 December 2024 including £6,000 (2023: £3,000) of Company’s own cash and £31,000 (2023: £47,000) relating to the purchase and sale of SIP shares by the employee benefit trust. The accompanying accounting policies and notes form an integral part of these financial statements. Overview Strategic Report Governance Financial Statements 73 Notes to the Financial Statements 1 General information The principal activities of Personal Group Holdings Plc (“the Company”) and subsidiaries (together “the Group”) include providing employee services and transacting short-term accident and health insurance in the UK. The Company is a limited liability company incorporated and domiciled in England. The address of its registered office is John Ormond House, 899 Silbury Boulevard, Milton Keynes, MK9 3XL. The Company is listed on the Alternative Investment Market of the London Stock Exchange. These financial statements have been approved for issue by the Board of Directors on 25 March 2025. 2 Accounting policies These financial statements of Personal Group Holdings Plc are for the year ended 31 December 2024. The consolidated Group and individual Company financial statements are prepared in accordance with UK endorsed IFRS in conformity with the requirements of Companies Act 2006. No individual profit and loss account is prepared for Personal Group Holdings Plc as provided by Section 408 of the Companies Act 2006. Standards issued but not yet effective The new and amended standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Group’s financial statements are disclosed below. The Group intends to adopt these new and amended standards and interpretations, if applicable, when they become effective. IFRS 18 Presentation and Disclosure in Financial Statements In April 2024, the IASB issued IFRS 18, which replaces IAS 1 Presentation of Financial Statements. IFRS 18 introduces new requirements for presentation within the statement of profit or loss, including specified totals and subtotals. Furthermore, entities are required to classify all income and expenses within the statement of profit or loss into one of five categories: operating, investing, financing, income taxes and discontinued operations, whereof the first three are new. It also requires disclosure of newly defined management-defined performance measures, subtotals of income and expenses, and includes new requirements for aggregation and disaggregation of financial information based on the identified ‘roles’ of the primary financial statements (PFS) and the notes. In addition, narrow-scope amendments have been made to IAS 7 Statement of Cash Flows, which include changing the starting point for determining cash flows from operations under the indirect method, from ‘profit or loss’ to ‘operating profit or loss’ and removing the optionality around classification of cash flows from dividends and interest. In addition, there are consequential amendments to several other standards. IFRS 18, and the amendments to the other standards, is effective for reporting periods beginning on or after 1 January 2027, but earlier application is permitted and must be disclosed. IFRS 18 will apply retrospectively. The Group is currently working to identify all impacts the amendments will have on the primary financial statements and notes to the financial statements. Insurance contracts IFRS 17 sets out the classification, measurement and presentation and disclosure requirements for insurance contracts. It requires insurance contracts to be measured using current estimates and assumptions that reflect the timing of cash flows and recognition of profits as insurance services are delivered. The standard provides two main measurement models which are the General Measurement Model (“GMM”) and the Premium Allocation Approach (“PAA”). The PAA simplifies the measurement of insurance contracts for remaining coverage in comparison to the GMM. The PAA is very similar to Personal Group’s previous accounting policies under IFRS 4 for calculating revenue, however there are some presentation changes. The GMM is used for the measurement of the liability for incurred claims. PAA eligibility Under IFRS 17, Personal Group’s insurance contracts issued are all eligible to be measured by applying the PAA, due to meeting the following criteria: • Insurance contracts with coverage period of one year or less are automatically eligible. This covers all hospital, recovery, and death benefit insurance contracts. • Modelling of contracts with a coverage period greater than one year (employee default policies) produces a measurement for the group of insurance contracts that does not differ materially from that which would be produced applying the GMM. Level of aggregation Personal Group manages all insurance contracts as one portfolio within the insurance operating segment as they are subject to similar risks. 2 Accounting policies continued Notes to the Financial Statements continued Personal Group Holdings Plc | Annual Report and Accounts 2024 74 Onerous contracts Under the PAA, it is assumed there are no contracts in the portfolio that are onerous at initial recognition, unless there are facts and circumstances that may indicate otherwise. Given the short-tailed nature of policies issued be Personal Group, management do not consider there to be any material circumstance under which policies in issue would be onerous. Modification and derecognition Personal Group derecognises insurance contracts when the rights and obligations relating to the contract are extinguished (meaning discharged, cancelled, or expired) or the contract is modified such that the modification results in a change in the measurement model or the applicable standard for measuring the contract. Contract boundaries The measurement of insurance contracts includes all future cash flows expected to arise within the boundary of each contract. Cash flows are within the boundary of an insurance contract if they arise from substantive rights and obligations that exist during the reporting period in which Personal Group can compel the policyholder to pay premiums or in which it has a substantive obligation to provide the policyholder with services. Personal Group assesses the contract boundary at initial recognition and at each subsequent reporting date to include the effects of changes in circumstances on the Group’s substantive rights and obligations. The assessment of the contract boundary, which defines the future cash flows that are included in the measurement of the contract, requires judgement and consideration. Personal Group primarily issues insurance contracts which provide coverage to policyholders in the event of hospitalisation, recovery, or death. While the contracts are typically weekly or monthly in their term length, the contract boundary is assessed with consideration of the delayed timing around claims of this nature and the timing of expected future claims payments with reference to the covered loss event. Measurement – Liability for remaining coverage On initial recognition of insurance contract, the carrying amount of the liability for remaining coverage is measured as the premiums received on initial recognition, if any, minus any reinsurance acquisition expense cash flows allocated to the contracts and any amounts arising from the derecognition of the prepaid reinsurance acquisition expense cash flows asset. Personal Group has chosen to expense insurance acquisition expense cash flows as incurred on its contracts as they have coverage of less than one year. Subsequently, at the end of each reporting period, the liability for remaining coverage is increased by any additional premiums received in the period and decreased for the amounts of expected premium cash flows recognised as reinsurance revenue for the services provided in the period. Personal Group has elected not to adjust the liability for remaining coverage for the time value of money as its insurance contracts do not contain a significant financing component. 2.1 Basis of preparation The functional and presentational currency of the Group is Sterling. These statements and the prior year comparatives have been presented to the nearest thousand, unless otherwise stated. In preparing these consolidated financial statements, management has made judgements, estimates and assumptions that affect the application of the Group’s accounting policies and the reported amount of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively. Climate Risk In preparing these financial statements the Directors have considered the impact of the physical and transition risks of climate change, but have concluded that it does not have a material impact on the recognition and measurement of the assets and liabilities in these financial statements as at 31 December 2024. This is because the assets are reported at fair value except for non-current assets of £12m which are reported at historical cost less impairment under UK endorsed international accounting standards. Market prices will include the current expectations of the impact of climate change on these investments. Insurance liabilities are accrued based on past insurable events so will not be impacted by any future impact of climate change and are short tailed in nature. However, we recognise that government and societal responses to climate change risks are still developing and the future impact cannot be predicted. Future valuations of assets may therefore differ as the market responds to these changing impacts or assesses the impact of current requirements differently and the frequency/magnitude of future insurable events linked to the effect of climate risks could change. Judgements Information about judgements made in applying accounting policies that have the most significant effects on the amounts recognised in the consolidated financial statements is included in the following note: • Agent vs principal (Note 2.22) – whether the sale of discounted vouchers should be treated as a principal or agency transaction. 2 Accounting policies continued 2.1 Basis of preparation continued Overview Strategic Report Governance Financial Statements 75 Assumptions and estimation uncertainties Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the year ending 31 December 2024 is included in the following notes: • Goodwill valuation (Note 13) – key assumptions underlying recoverable amounts. • Establishing the value of insurance contract liabilities (Note 23) – key assumptions regarding the provisions for claims. Going concern The financial statements are prepared on a going concern basis. In considering going concern, the Directors have reviewed the Group’s and Company’s future cash requirements, earnings projections and capital projections over the period to 26 March 2026. The Directors believe that projections have been prepared on a prudent basis and have also considered the impact of a range of potential changes to trading performance over the period to 26 March 2026, including the impacts of climate risk discussed above. Having prepared and considered these stress scenarios the Directors have concluded that the Group and Company will be able to operate without requiring any external funding and therefore believe it is appropriate to prepare the financial statements of the Group and Company on a going concern basis. This is supported by the Group’s, and Company’s, liquidity position at the year end. 2.2 Basis of consolidation Subsidiaries Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. In assessing control, the Group takes into consideration potential voting rights that are currently exercisable. The acquisition date is the date on which control is transferred to the acquirer. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. Intra-Group balances and transactions, and any unrealised income and expenses arising from these transactions, are eliminated on consolidation. 2.3 Goodwill and acquired intangibles Goodwill representing the excess of the cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired, is capitalised and reviewed annually for impairment. Goodwill is carried at cost less accumulated impairment losses. Negative goodwill is recognised immediately after acquisition in the income statement. Intangible assets meeting the relevant recognition criteria are initially measured at cost and amortised on a systematic basis over their useful lives. 2.4 Revenue Revenue is measured by reference to the fair value of consideration received or receivable by the Group for goods supplied and services provided, excluding VAT, IPT and trade discounts. Whilst IFRS 15 considerations have been noted for the most significant revenue streams to which it is applicable, the insurance revenue stream is out of scope for IFRS 15. Insurance Revenue Insurance income is recognised in the period in which the Group is legally bound through a contract to provide insurance cover, which is typically a week or a month in length and renews at the end of each cover period. Insurance revenue represents the expected premium cash flows net of any deductions that are paid to reinsurance providers, excluding any investment components. Insurance revenue is shown before deduction of commission and excludes any sales-based taxes or duties. Other insurance related Commission receivable on the renewal of previously sold financial services are recognised by the Group as the renewal takes place with the underwriter. Platform income Platform income, including that derived from Hapi, is recognised on a straight-line basis over the length of the contract. Where a proportion of this income and costs, credited or charged in the current year, relate to the provision of services provided in the following year, they are carried forward as deferred income or costs, calculated on a daily pro-rata basis. IFRS 15 – Platform income (Benefits and Reward) Performance Obligations Ongoing access to Hapi platform with each relevant month access is provided being considered a separate performance obligation. Transaction Price Prices are typically set on a per employee or fixed rate and are agreed with each client individually. Allocation of Price Price allocated evenly to each period/performance obligation. Satisfaction of Obligations Recognised straight-line over period of agreement of service as the performance obligation is deemed to be met each month as the contract progresses. Notes to the Financial Statements continued 2 Accounting policies continued 2.4 Revenue continued Personal Group Holdings Plc | Annual Report and Accounts 2024 76 Voucher income derives from customers ordering retail vouchers through the Hapi platform. E-vouchers are fulfilled and made available instantly to the customer while, for reloadable cards, customers receive these several working days after placing the order. Income from the sale of reloadable cards and e-vouchers is recognised as orders are fulfilled by the Group. These transactions the Group acts as agency income. Refer to 2.22 for further details of agent vs principal assessment. IFRS 15 – Voucher resale income (Benefits and Reward) Performance Obligations Provision of voucher to individuals/companies. Transaction Price Prices are based on each retailer’s discount on purchase into the Group. Allocation of Price Whole price allocated to the sole performance obligation. Satisfaction of Obligations Recognised on dispatch of voucher as this is the point at which the Group has fulfilled its part of the agreed contract. The Group receives income from its provision of HR consultancy services to corporate clients. Consultancy income is recognised in the profit and loss account at the relevant charge out rates of the consultants and based on the chargeable time spent on each client project. IFRS 15 – Consultancy income (Benefits and Reward) Performance Obligations Provision of consultancy services, typically based on an agreed number of consultant hours. Transaction Price Prices are based on each contractual client agreement, dependant on the level and duration of consultant hours spent. Allocation of Price Each chargeable hour will have an agreed price dependant on the level and experience of the consultant. Satisfaction of Obligations Each consultant hour charged is considered a separate performance obligation and recognition is recorded periodically (typically monthly) based on chargeable hours in that period. Costs incurred to fulfil a contract Costs incurred to fulfil a contract under IFRS 15 are recognised as an asset under certain conditions laid out in IFRS 15.95. The capitalised contract costs are amortised on a systematic basis that is consistent with the Company’s transfer of the related goods or services to the customer. Capitalised contract costs are subject to an impairment assessment at the end of each reporting period. Impairment losses are recognised in the profit or loss. There are no contracts in the Group for which these conditions are met and, as such, no assets have been recognised. Investment income Interest income is recognised on an effective interest rate method. Discontinued operations – Other Owned Benefits – IT Salary Sacrifice Income from the provision of salary sacrifice technology products were recognised when the goods were dispatched. IFRS 15 – IT salary sacrifice income (Other Owned Benefits) Performance Obligations Provision of IT goods to employer companies. Goods were acquired by the Group from various suppliers and held as inventory until sold to customers at an agreed price. Transaction Price Purchase price varied dependant on product purchased but is clearly indicated. Allocation of Price Prices were allocated by product, volumes and values. Satisfaction of Obligations Revenue was recognised on dispatch as Group has met its performance obligation as per the contracts in place. 2.5 Reinsurance Outwards reinsurance premiums are accounted for in the same accounting period as the insurance revenue for the related direct or inwards business being reinsured. Amounts recoverable under reinsurance contracts are assessed for impairment at each balance sheet date. As required, impairment losses are recognised in the income statement and the carrying amount of assets are impaired so that they do not exceed the expected net cash inflow for the Group. 2.6 Measurement – Liability for incurred claims The liability for incurred claims represents the estimated ultimate cost of settling all insurance claims arising from events that have occurred up to the end of the reporting period, including the operating costs that are expected to be incurred in the course of settling such claims. The liability for claims is derived from the estimated fulfilment cash flows relating to expected claims. The fulfilment cash flows incorporate, in an unbiased way, all reasonable and supportable information available, without undue cost of effort, about the amount, timing and uncertainty of those future cash flows. They also include an explicit risk adjustment. Estimates of future cash flows for incurred claims are not discounted on initial recognition due to the immateriality of the impact of the time value of money as discussed in Note 23. 2 Accounting policies continued Overview Strategic Report Governance Financial Statements 77 2.7 Property, plant and equipment and intangible assets Property, plant and equipment and software intangibles are stated at cost, net of depreciation, amortisation and any provision for impairment. No depreciation or amortisation is charged during the period of construction. Research and development Expenditure on research activities is recognised in the income statement as an expense as incurred. Expenditure on development activities is capitalised if the product or process is technically and commercially feasible and the Group intends, and has the technical ability and sufficient resources to, complete development, future economic benefits are probable and if the Group can measure reliably the expenditure attributable to the intangible asset during its development. Development activities involve a plan or design for the production of new or substantially improved products or processes. The expenditure capitalised includes the cost of materials, external consultancy costs and salary costs where a distinct product has been created. Other development expenditure is recognised in the income statement as an expense as incurred. Capitalised development expenditure is stated at cost less accumulated amortisation and less accumulated impairment losses. Disposal of assets The gain or loss arising on the disposal of an asset is determined as the difference between the disposal proceeds and the carrying amount of the asset and is recognised in the income statement. Amortisation and depreciation Amortisation and depreciation are calculated to write down the cost or valuation less estimated residual value of all intangible assets, and tangible assets other than freehold land excluding investment properties by equal annual instalments over their estimated economic useful lives. Residual value is reviewed annually and amended if material. The rates generally applicable are: Freehold properties 50 years Motor vehicles 3 – 4 years Computer equipment 2 – 4 years Furniture, fixtures and fittings 5 – 10 years Computer software and development 2 – 4 years Internally generated intangibles 3 – 5 years Intangible assets 3 – 5 years Right of Use Assets Term of Lease 2.8 Leases Under IFRS 16, with the exception of short-term or low value leases, all operating and finance leases are accounted for in the balance sheet. On inception of the lease, the future payments, including any expected end of life costs, are discounted based on the implicit interest rate in the specific lease. A “Right of Use” asset is created at an equal value depreciated over the life of the lease which is determined by the contract with any break clauses being reviewed as to the expected use at the time of inception and at each following year end. Payments made to the lessor are debited to the balance sheet and the income statement is charged with monthly depreciation and interest which is included as finance costs in the accounts. Low value leases or short life leases of less than one year are expensed directly into the income statement account on a straight line over the life of the lease. 2.9 Impairment of non-financial assets For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). As a result, some assets are tested individually for impairment and some are tested at cash-generating unit level. Goodwill is allocated to those cash-generating units that are expected to benefit from synergies of the related business combination and represent the lowest level within the Group at which management monitors the related cash flows. Goodwill, other individual assets or cash-generating units that include goodwill and those intangible assets not yet available for use are tested for impairment at least annually. All other individual assets or cash-generating units are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. See Note 13 for further details on the impairment testing of goodwill. Notes to the Financial Statements continued 2 Accounting policies continued Personal Group Holdings Plc | Annual Report and Accounts 2024 78 2.10 Taxation Current tax is the tax currently payable based on taxable profit for the year. Deferred income taxes are calculated using the liability method on temporary differences. Deferred tax is generally provided on the difference between the carrying amounts of assets and liabilities and their tax bases. However, deferred tax is not provided on the initial recognition of goodwill, nor on the initial recognition of an asset or liability unless the related transaction is a business combination or affects tax or accounting profit. Deferred tax on temporary differences associated with shares in subsidiaries is not provided if reversal of these temporary differences can be controlled by the Group and it is probable that reversal will not occur in the foreseeable future. In addition, tax losses available to be carried forward as well as other income tax credits to the Group are assessed for recognition as deferred tax assets. Deferred tax liabilities are provided in full, with no discounting. Deferred tax assets are recognised to the extent that it is probable that the underlying deductible temporary differences will be able to be offset against future taxable income. Current and deferred tax assets and liabilities are calculated at tax rates that are expected to apply to their respective period of realisation, provided they are enacted or substantively enacted at the balance sheet date. 2.11 Financial assets Financial assets include; equity investments, bank deposits (as defined below); loans and other receivables. Financial assets are assigned to the different categories by management on initial recognition, depending on the purpose for which they were acquired. A financial asset is measured at amortised cost if it is both: held within a business model whose objective is to hold assets to collect contractual cash flows; and its contractual terms give rise to cash flows that are solely payments of principal and interest on the amount outstanding. For the purposes of this assessment, “principal” is defined as the fair value of the financial asset on initial recognition, and “interest” is defined as consideration for the time value of money and for the credit risk associated with the principal amount outstanding. In assessing whether the contractual cash flows are solely payments of principal and interest, the Group considers the contractual terms of the instrument, including any terms which may affect the timing or amount of contractual cash flows. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans and receivables are measured subsequent to initial recognition at amortised cost using the effective interest method, less provision for impairment. Any change in their value through impairment or reversal of impairment is recognised in the income statement. Fixed interest rate bank deposits with a maturity date of three months or more from the date of acquisition are measured at fair value (historical cost plus accrued interest). Equity investments are financial assets categorised as fair value through profit and loss and are initially recognised at fair value on the date acquired and are subsequently re-measured at their fair value. Changes in the fair value of equity investments are recognised in profit or loss. In assessing impairment requirements on financial assets (which are not categorised as fair value through profit and loss), the Group considers the rate of historic losses on similar assets in conjunction with expected future losses and credit losses as a result of potential defaults. This will, as mandated by IFRS 9, continue to be reassessed as and when further information becomes available or when conditions change. A financial asset is de-recognised only where the contractual rights to the cash flows from the asset expire or the financial asset is transferred, and that transfer qualifies for de-recognition. A financial asset is transferred if the contractual rights to receive the cash flows of the asset have been transferred or the Group retains the contractual rights to receive the cash flows of the asset but assumes a contractual obligation to pay the cash flows to one or more recipients. A financial asset that is transferred qualifies for de- recognition if the Group transfers substantially all the risks and rewards of ownership of the asset, or if the Group neither retains nor transfers substantially all the risks and rewards of ownership but does transfer control of that asset. Impairment of financial assets The Group assesses on a forward-looking basis, the expected credit losses (ECL) associated with its debt instrument assets carried at amortised cost. The Group calculates the lifetime ECL as a practical expedient for short-term receivables. A loss allowance is recognised for such losses at each reporting date. The Group measures ECL on each balance sheet date according to a three stage ECL impairment model: Stage 1 – from initial recognition of the financial asset to the date on which the asset has experienced a significant increase in credit risk (SICR) relative to its initial recognition, a loss allowance is equal to the credit loss expected to result from default occurring over 12 months following the reporting date. Stage 2 – following a significant increase in credit risk relative to the initial recognition of the financial asset, a loss allowance is recognised equal to the credit losses expected over the remaining lifetime of the asset. Where an SICR is no longer observed, the instrument will move back to Stage 1. 2 Accounting policies continued 2.11 Financial assets continued Impairment of financial assets continued Overview Strategic Report Governance Financial Statements 79 Stage 3 – when the financial asset is considered to be credit impaired, a loss allowance is recognised equal to the credit losses expected over the remaining life of the asset. Interest and revenue is calculated based on the gross carrying amount of the asset, net of the loss allowance. The measurement of the ECL reflects an unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes, the time value of money and reasonable and supportable information that is available without undue cost and effort at the reporting date about past events, current conditions and forecasts of future economic conditions. 2.12 Financial liabilities Financial liabilities are classified as measured at amortised cost or fair value through profit and loss (FVTPL). A financial liability is classified as at FVTPL if it is classified as held-for-trading or it is designated as such on initial recognition. Financial liabilities are subsequently measured at amortised cost using the effective interest method, with interest related charges recognised as an expense in finance cost in the income statement. Finance charges, including premiums payable on settlement or redemption and direct issue costs, are charged to the income statement on an accruals basis using the effective interest method and are added to the carrying amount of the instrument to the extent that they are not settled in the period in which they arise. There are no financial liabilities categorised as at fair value through profit or loss. A financial liability is de-recognised only when the obligation is extinguished, that is, when the obligation is discharged or cancelled or expires. 2.13 Cash and cash equivalents Cash and cash equivalents comprise cash on hand and demand deposits, together with other short-term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value. As stated in Note 2.11 fixed interest rate bank deposits with the maturity date of three months or more from the date of acquisition are classified as financial assets. 2.14 Investments in subsidiary undertakings Company investments in subsidiary undertakings and joint ventures held in the Company Balance Sheet are shown at cost less impairment provisions. Impairment testing is completed as and when an indicator for impairment under IAS 36 arises. If the carrying amount of the investment exceeds its recoverable amount (calculated as the higher of Fair Value Less Costs of Disposal or Value in Use), an impairment loss is recognised in accordance with IAS 36, reducing the investment’s alue to its recoverable amount. 2.15 Equity Equity comprises the following: • “Share capital” represents the nominal value of equity shares. • “Share premium account” represents the amount paid on issue for equity shares in excess of their nominal value. • “Capital redemption reserve” represents the nominal value of its own equity shares purchased, and then cancelled, by the Group. • “Share based payments reserve” represents the equity value of the accumulated share based payments expenses in long-term incentive plans. • “Other reserve” represents the investment in own Company shares by the Employee Benefit Trust. • “Profit and loss reserve” represents retained profits. 2.16 Employee benefits Defined contribution group and self-invested personal pension schemes. The pension costs charged against profits are the contributions payable to the schemes in respect of the accounting period. 2.17 Share-based payment Equity-settled share-based payment All goods and services received in exchange for the grant of any share-based payment are measured at their fair values. Where employees are rewarded using share-based payments, the fair values of employees’ services are determined indirectly by reference to the fair value of the instrument as at the date it is granted to the employee. All equity-settled share-based payments are ultimately recognised as an expense in the income statement with a corresponding credit to “profit and loss reserve”. If vesting periods or other non-market vesting conditions apply, the expense is allocated over the vesting period, based on the best available estimate of the number of share options expected to vest. Estimates are subsequently revised if there is any indication that the number of share options expected to vest differs from previous estimates. Any cumulative adjustment prior to vesting is recognised in the current period. No adjustment is made to any expense recognised in prior periods if share options ultimately exercised are different to that estimated on vesting. Upon exercise of share options, the proceeds received net of attributable transaction costs are credited to share capital, and where appropriate share premium. Notes to the Financial Statements continued 2 Accounting policies continued Personal Group Holdings Plc | Annual Report and Accounts 2024 80 2.18 Employee benefit trust The assets and liabilities of the Employee Benefit Trust (EBT) have been included in the Group accounts. Any assets held by the EBT cease to be recognised on the Group balance sheet when the assets vest unconditionally in identified beneficiaries. The costs of purchasing own shares held by the EBT are shown as a deduction against equity. The proceeds from the sale of own shares held increase equity. Neither the purchase nor sale of own shares leads to a gain or loss being recognised in the Group income statement. At present the Company operates a plan whereby all employees are entitled to make monthly payments to the trust via payroll deductions. The current allocation period is six months and shares are allocated to employees at the end of each allocation period. The shares are allocated at the lower of the mid-market price at the beginning and end of the allocation period. The trust Company has not waived its right to dividends on unallocated shares. Any profit or loss on allocation of shares to individuals is taken directly to the “other reserve” within equity. 2.19 Shares held in an employee benefit trust Transactions of the Company sponsored EBT are treated as being those of the Company and are therefore, reflected in these financial statements. 2.20 Inventories Inventories are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow-moving items. Cost includes all direct costs and an appropriate proportion of fixed and variable overheads. 2.21 Provisions A provision is recognised in the balance sheet when the Group has a present legal, or constructive, obligation as a result of a past event, that can be reliably measured, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects risks specific to the liability. 2.22 Agent vs Principal The sale of discounted vouchers, be it physical or electronic, represents a significant activity for the Group with revenue presented as voucher resale income within the Benefits and Reward segment. The Group has a mixture of relationships with retailers and third- party suppliers, depending on the offering. Some offerings require purchasing inventory in advance while others require the maintaining of cash floats with suppliers and others require the settlement of supplier invoices as they are received. Depending on the contractual relationship and the nature of the transactions with the relevant suppliers, the Group has made a judgement on whether the offerings constitute agency or principal transactions. This judgement is significant in nature as it has a material impact on the revenue and cost of sales of the Group. Overview Strategic Report Governance Financial Statements 81 3 Risk management objectives and policies The Board recognises that the effective management of risks and opportunities is fundamental to achieving the Group’s strategic objectives. As a result, it is important there is a strong risk management culture throughout the Group, and that we identify, assess and appropriately optimise the key risks to the Group achieving this strategy. To achieve its objectives as well as sustainable profitability, the Group may pursue the opportunities that gave rise to risk. Therefore, we have adopted an Enterprise Risk Management Framework as part of our decision making and business management process. As a result of this rigorous approach, the Group can maintain financial security, produce good outcomes and the fair treatment of customers, and meet the needs of other parties such as shareholders, employees, suppliers and regulators. We review the risk management strategy regularly, particularly after any significant change to the change environment and, each year, after the approval of the Group’s strategy and business plans. The most significant financial risks to which the Group and Company are exposed under normal circumstances are described in this section. Credit risk The Group’s and Company’s exposure to credit risk includes the carrying value of certain financial assets at the balance sheet date, summarised as follows: Group Company Restated 2024 2023 2024 2023 £’000 £’000 £’000 £’000 Other receivables 7,878 13,857 – – Accrued interest 2 2 – – Cash and cash equivalents 19,060 14,571 37 50 Equity investments 1,593 1,470 – – Bank deposits 8,319 5,491 4,750 – Total credit risk 36,852 35,391 4,787 50 A large proportion of the Group’s revenue is generated from the sale of insurance policies to individual customers, with most of the premiums collected, and paid over to the Group, by the individuals’ employer via payroll deduction. The vast majority of employers pay over payroll deductions made, within one month, on a regular basis, thereby minimising the credit risk exposure to the Group. The use of payroll deductions by a “host company employer” would not be permitted where the Board believed there may be a significant credit risk. Receivables past their due date are summarised within Note 18. The credit risk for liquid funds and other short-term financial assets is considered negligible, since the counterparties are all regulated in the UK by the PRA. At 31 December 2024 the counterparties were as follows: The Co-operative Bank plc, HSBC Bank Plc, Lloyds Bank Plc, Link Treasury Services Limited and Aberdeen Standard Investments. Long-term rate credit ratings for these counterparties range from AA to B (ratings sourced from Fitch, and Standard & Poor’s) (2023: AA to B rating range). The Group is also exposed to the recoverability of receivables from reinsurers. At 31 December 2024, the Group utilised two reinsurances counterparties, namely, Swiss Re Europe S.A., United Kingdom Branch and AXA XL Insurance Life Syndicate 3002. Credit ratings for this reinsurer range from A+ to AA. All subsidiary undertakings are 100% owned by the Company or subsidiaries thereof. There is at least one Director of Personal Group Holdings on each of the larger subsidiary companies’ Boards and all operations are controlled from within the registered office in Milton Keynes. The Company Directors have a good understanding of the operational performance of each of the subsidiary undertakings. The Company Directors are satisfied that the subsidiary undertakings have sufficient future income streams to enable the liabilities to be repaid in full in the foreseeable future. Information relating to the fair value measurement of financial assets can be found in Note 16. Interest rate risk The Group is not exposed to any financial liabilities with an interest element aside from the interest element intrinsic in leases. At 31 December 2024, bank deposits and cash and cash equivalents were £27,400,000 (2023: £20,100,000). If UK interest rates increased by 2%, net finance income would increase by approximately £548,000 with a corresponding increase to equity. Market risk The Group is exposed to market risk, in the form of equity price risk, in respect of its equity investments in managed funds which are invested in worldwide equities and so are valued via directly observable inputs (level 1 inputs). The assets are measured at fair value through profit and loss. An increase of 10% in the Group’s equity investments would result in an unrealised gain in the income statement of £159,000. Notes to the Financial Statements continued 3 Risk management objectives and policies continued Personal Group Holdings Plc | Annual Report and Accounts 2024 82 Liquidity risk Cash balances are managed internally and amounts are placed on short-term deposits (currently not exceeding six months) to ensure that sufficient funds are available at all times to pay all liabilities as and when they fall due. As at 31 December 2024, the Group’s and Company’s liabilities have contractual maturities (including interest payments where applicable) as summarised below: Within 6 6–12 months months 1–5 years Total £’000 £’000 £’000 £’000 Group At 31 December 2024 Trade and other payables 12,965 141 43 14,395 Insurance contract liabilities 479 – – 889 Total liquidity risk 13,444 141 43 15,284 At 31 December 2023 Trade and other payables 14,382 174 43 15,667 Insurance contract liabilities (20) – – 735 Total liquidity risk 14,362 174 43 16,402 * The table above excludes non-cash items relating to insurance liabilities for remaining coverage or unearned revenue across the different business segments. As at 31 December 2024, the Company did not have any contractual maturities (including interest payments where applicable). Currency risk The Group is not exposed to any currency risk as all business is conducted in GBP and all bank accounts were held in GBP in both 2024 and 2023. Insurance claim and related risks During the year, Personal Assurance Plc (PA) underwrote two categories of business and Personal Assurance (Guernsey) Ltd (PAGL) a further two categories, which are described in detail below: Hospital cash plans and other personal accident and sickness policies These have been PA’s core products since 1984 and, at 31 December 2024, represent 99.4% (2023: 99.2%) of PA’s gross premiums written. The vast majority of these policies are sold to individuals at their place of work as part of an employee benefits package introduced by PGH on behalf of the employer. The gross loss ratio (excluding claims handling costs) on these policies at 31 December 2024 was 28.7% (2023: 26.9%). While the loss ratio has increased year on year, historic losses have been consistent over the period of time that these policies have been underwritten and therefore the Board has taken the decision to continue to accept the underwriting risk in full and not to use reinsurance as a way of managing insurance claim risk. This will continue to be reviewed to ensure that this remains appropriate going forward. At present the maximum payable on any one single claim is £91,375 (2023: £91,375) and would only be payable after a period of hospital confinement of two years. The total number of these individual policies in force at 31 December 2024 was 199,566 (2023: 177,073) and the total annualised premium value of these policies was £26,793,752 (2023: £23,399,000). The average amount paid per claim in 2024 was £180 (2023: £187). Voluntary Group Income Protection policies (VGIP) In July 2012 PA commenced the underwriting of VGIP policies. In order to manage this insurance risk, the Board took out a quota share reinsurance policy to exclusively cover this part of the business. Under this reinsurance policy 90% of the value of each claim is recoverable from the reinsurer. At 31 December 2024 these policies represent 0.6% (2023: 0.8%) of PA’s gross premiums written. The total annualised premium value of these policies was £134,000 (2023: £163,000). The gross loss ratio (excluding claims handling costs) on these policies at 31 December 2024 was 10.1% (2023: 17.5%). The total number of these individual policies in force at 31 December 2024 was 357 (2023: 430) and the average amount paid per claim in 2023 was £7,836 (2023: £2,583). Death benefit policies Death benefit policies have been underwritten by PAGL since March 2015. These policies are sold primarily to individuals at their place of work in the same way as the hospital cash plans. 3 Risk management objectives and policies continued Death benefit policies continued Overview Strategic Report Governance Financial Statements 83 At 31 December 2024 these policies represent 96% (2023: 91%) of PAGL’s gross premiums. The total annualised premium value of these policies was £8,936,000 (2023: £7,949,000). The gross loss ratio (excluding claims handling costs) on these policies at 31 December 2024 was 19.3% (2023: 18.6%). A stop loss reinsurance policy is in place to cover claims over £3,000,000 at any given location. The total number of these individual policies in force at 31 December 2024 was 71,955 (2023: 67,756) and the average amount paid per death in 2024 was £9,790 (2023: £9,779). Employee default policies In February 2020 PAGL commenced the underwriting of employee default policies in relation to salary sacrifice sales made by Let’s Connect. These policies provided cover to Let’s Connect’s largest customer in the event that employees left owing salary sacrifice deductions to their employer and these monies were unable to be recovered by alternative means. The last policy was written in March 2023. At 31 December 2024 these policies represent 4% (2023: 9%) of PAGL’s gross premiums. The gross loss ratio (excluding claims handling costs) on these policies at 31 December 2024 was 54.7% (2023: 38.4%) and the average amount paid per individual default in 2024 was £317 (2023: £438). Group loss ratio For the year ended 31 December 2024 the gross claims ratio of the Group was 29.1% (2023: 27.0%), by taking claims incurred as a proportion of insurance revenue. A 2% increase in the claims ratio would increase claims incurred by approximately £643,000. There are no material individual claims and open claims over 12 months old are also immaterial. As a result, the Group has elected to not disclose claims development tables. 4 Capital management and requirements The Group’s capital management objective is to maintain sufficient capital to safeguard the Group’s ability to continue as a going concern and to protect the interests of all of its customers, investors, regulator and trading partners while also efficiently deploying capital and managing risk to sustain ongoing business development. The Group manages its capital resources in line with the Group’s capital management Policy, which is reviewed on an annual basis. The Group’s capital position is kept under constant review and is reported monthly to the Board. Since 1 January 2016, Personal Assurance Plc (PA) has been subject to the requirements of the Solvency UK (SUK) Directive and must hold sufficient capital to cover its Solvency Capital Requirement (SCR). In addition, PA maintains a buffer in excess of this capital requirement, specified in line with the capital risk appetite agreed by the Board. The SCR is calculated in accordance with the Standard Formula specified in the Solvency UK legislation. At least annually, the Group undertakes the Own Risk and Solvency Assessment (ORSA). This process enables the Group to assess how well the Standard Formula SCR reflects the Group’s actual risk profile, and comprises all the activities by which PA establishes the level of capital required to meet its solvency needs over the planning period given the Company’s strategy and risk appetite. The conclusions from these activities are summarised in the ORSA Report which is reviewed by the Risk Committee, approved by the Board and submitted to the Prudential Regulation Authority (PRA) at least annually. PA’s unaudited Eligible Own Funds, determined in accordance with the Solvency UK valuation rules, were £11.9m (2023: £10.8m) which was in excess of the estimated SCR of £4.3m (2023: £4.0m). This represented an estimated solvency coverage ratio of 279% (2023: 272%). The movement year on year remains well within the Board’s risk appetite of holding greater than 150% of the requirement. Other than disclosed above there have been no changes to what is managed as capital or the Group’s capital management objectives, policies or procedures during the year. At 31 December 2024, the requirements of the Group’s regulated companies were as follows: Surplus Capital over capital resources Capital resources requirement resources requirement Relevant unaudited unaudited unaudited regulatory £’000 £’000 £’000 body Company Personal Assurance Plc 4,252 11,882 7,631 FCA, PRA Personal Assurance Services Limited 70 1,377 1,307 FCA Personal Group Benefits Limited 54 825 771 FCA Berkeley Morgan Limited 5 152 147 FCA Personal Assurance (Guernsey) Limited 807 4,391 3,583 GFSC Personal Assurance Plc and Personal Assurance (Guernsey) Limited maintain the majority of their assets in cash and short-term fixed interest rate deposits. The capital resources and corresponding capital resource requirement for each PRA regulated entity is calculated in accordance with PRA regulations. The capital resources and corresponding capital resource requirement for each FCA regulated entity is calculated in accordance with FCA regulations. The Group’s capital comprises all components of equity. The Group’s regulated entities have complied with all externally imposed capital requirements during the year. Notes to the Financial Statements continued Personal Group Holdings Plc | Annual Report and Accounts 2024 84 5 Segment analysis The segments used by management to review the operations of the business are disclosed below. 1) Affordable Insurance Personal Assurance Plc (PA), a subsidiary within the Group, is a PRA regulated general insurance Company and is authorised to transact accident and sickness insurance. It was established in 1984 and has been underwriting business since 1985. In 1997 Personal Group Holdings Plc (PGH) was created and became the ultimate parent undertaking of the Group. Personal Assurance (Guernsey) Limited (PAGL), a subsidiary within the Group, is regulated by the Guernsey Financial Services Commission and has been underwriting death benefit policies since March 2015. This operating segment derives the majority of its revenue from the underwriting by PA and PAGL of insurance policies that have been bought by employees of host companies via bespoke benefit programmes. 2) Benefits and Reward Revenue in this segment relates to the annual subscription income and other related income arising from the licensing of Hapi, the Group’s employee benefit platform. This includes sales to both the large corporate and SME sectors. This segment includes agency revenue generated from the resale of vouchers (Note 2.22). Revenue also includes consultancy, surveys, and licence income derived from selling digital platform subscriptions. 3) Other The other operating segment consists exclusively of revenue generated by Berkeley Morgan Group (BMG) and its subsidiary undertakings along with any investment income obtained by the Group. Discontinued Operations – Other Owned Benefits This segment constitutes any goods or services in the benefits platform supply chain which was owned by the Group, prior to its disposal in July 2024. As such, this segment is treated as discontinued operations within these accounts. Restated 2024 2023 £’000 £’000 Revenue by segment from continuing activities Affordable Insurance 32,166 28,708 Benefits & Reward 13,024 11,691 Benefits & Reward – Group Elimination (2,747) (2,760) Other income Other 136 139 Investment income 1,197 807 Total Revenue from continuing activities 43,776 38,585 Adjusted EBITDA contribution from continuing activities by segment Affordable Insurance 12,424 11,226 Benefits & Reward 5,215 4,330 Other 1,382 1,033 Group admin and central costs (8,937) (8,732) Charitable donations (100) (100) Adjusted EBITDA* from continuing activities 9,984 7,757 Interest (106) (76) Depreciation (1,111) (1,063) Amortisation (1,415) (732) Restructuring costs (324) (639) Share based payments expenses (202) (169) Profit before tax from continuing activities 6,826 5,078 5 Segment analysis continued Overview Strategic Report Governance Financial Statements 85 Restated 2024 2023 £’000 £’000 Revenue by Segment from discontinued activities Other Owned Benefits 2,572 11,081 Group Revenue from discontinued activities 2,572 11,081 Adjusted EBITDA contribution from discontinued activities Other Owned Benefits (216) 369 Adjusted EBITDA from discontinued activities (216) 369 Profit on disposal of Let’s Connect 1,167 – Depreciation (34) (71) Amortisation (14) (36) Interest (1) (3) Profit before tax from discontinuing activities 902 259 * Adjusted EBITDA is defined as earnings before interest, tax, depreciation, amortisation, goodwill impairment, restructuring costs, share-based payment expenses, profits on disposal of subsidiaries, corporate acquisition costs, and release of tax provision. ** These costs constitute Group administration expenses on the face of the Consolidated Income Statement. Segmental assets and liabilities 2024 2023 Assets Liabilities Assets Liabilities £’000 £’000 £’000 £’000 Insurance 30,867 9,237 24,230 8,193 Other Owned Benefits – – 7,585 2,509 Benefits Platform 9,417 7,158 7,994 6,471 Pay & Reward 1,348 52 1,100 21 Other 9,655 – 8,280 – Total segment assets and liabilities 51,287 16,447 49,189 17,194 Other assets comprise mostly of goodwill, intangible assets and equity investments. 5a Further segmental analysis The following note provides additional analysis on Group segmental income and expenditure. Benefits and Reward income 2024 2023 £’000 £’000 Benefits Platform 10,507 9,445 Pay & Reward 2,517 2,246 Group elimination (2,747) (2,760) Total employee benefits and service income 10,277 8,931 Insurance operating expenses 2024 2023 £’000 £’000 Operating expenses 19,662 17,353 Group elimination (2,747) (2,760) Total insurance operating expenses 16,915 14,593 * In order to properly assess the segments individually, this Group elimination apportions at arm’s length value to platform sales offered at a discount in return for insurance selling opportunities at corporate clients. This value is then added to Benefits Platform income and Insurance service expenses before being eliminated out. Benefits and Reward expenses 2024 2023 Cost of Operating Total Cost of Operating Total sales expenses expenses sales expenses expenses £’000 £’000 £’000 £’000 £’000 £’000 Benefits Platform 2,576 3,554 6,130 2,225 3,384 5,609 Pay & Reward 25 1,655 1,680 35 1,718 1,753 Total employee benefits and services expenses 2,601 5,209 7,810 2,260 5,102 7,362 Gross transactional value Gross transactional value from the sale of goods and vouchers is recognised at the net value when significant risks and rewards of ownership of the goods and vouchers have been passed to the buyer, usually on the dispatch of the goods and vouchers. The Group is considered to be an agent for voucher sales with a total transaction value of £59,676,000 (2023: £54,805,000). Notes to the Financial Statements continued Personal Group Holdings Plc | Annual Report and Accounts 2024 86 6 Investment income 2024 2023 £’000 £’000 Interest income from cash on deposit 1,197 807 Total investment income 1,197 807 7 Insurance service expenses Net expenses from reinsurance contracts held 2024 2023 £’000 £’000 Outward reinsurance premium (92) (105) Reinsurer’s share of claims paid 13 (30) Net expenses from reinsurance contracts held (79) (135) 2024 2023 £’000 £’000 Claims paid 8,279 6,799 Claims handling expenses paid 828 763 Claims Incurred 9,107 7,562 Changes to liabilities for claims 241 117 Net change in claims provision 241 117 Incurred acquisition costs 5,990 5,488 Administration expenses 1,577 1,426 Total Insurance operating expenses 7,567 6,914 Total insurance service expenses 16,915 14,593 8 Directors’ and employees’ remuneration a) Staff costs (excluding Non-Executive Directors’ fees) during the year were as follows: 2024 2023 £’000 £’000 Wages and salaries 11,900 12,693 Share-based payments expense 202 169 Social security costs 1,368 1,609 Other pension costs 604 636 Total staff costs 14,074 15,107 The average number of employees employed through the year was as follows: 2024 2023 Number Number Administration 159 180 Sales and marketing 94 89 Total number of employees 253 269 b) Directors’ remuneration: 2024 2023 £’000 £’000 Emoluments 1,222 1,111 Gain on exercise of options 11 – Termination payment – 185 Pension contributions to Group and self-invested personal pension schemes 32 33 Total Director’s remuneration 1,265 1,329 During the year, two Directors (2023: three Directors) participated in Group and self-invested personal pension schemes. The amounts set out above include remuneration in respect of the highest paid Director as follows. All emoluments relate to payments made by subsidiary undertakings. 8 Directors’ and employees’ remuneration continued b) Directors’ remuneration continued : Overview Strategic Report Governance Financial Statements 87 2024 2023 £’000 £’000 Emoluments 557 348 Termination payment – 185 Pension contributions to Group and self-invested personal pension schemes 19 10 Total 576 543 Details of individual Director’s remuneration are given in the Remuneration Report on pages 45 to 50. The Company does not incur employee remuneration. Key management of the Group are the Directors of Personal Group Holdings Plc together with the members of the Senior Leadership Team. Key management personnel remuneration includes the following expenses: 2024 2023 £’000 £’000 Short-term employee benefits: Salaries including bonuses 1,805 1,630 Social security costs 249 225 Gain on exercise of options 21 – 2,075 1,855 Post-employment benefits: Defined contribution pension plans 57 60 Total remuneration 2,132 1,915 9 Profit before tax 2024 2023 Profit before tax is stated after: £’000 £’000 Auditor’s remuneration (inclusive of non-recoverable VAT): Audit services: Audit of Company financial statements 246 180 Audit of subsidiary undertakings 152 135 Non-audit services: – – Depreciation of property, plant and equipment 1,111 1,135 Amortisation 1,415 770 Notes to the Financial Statements continued Personal Group Holdings Plc | Annual Report and Accounts 2024 88 10 Tax The relationship between the expected tax expense based on the effective tax rate of Personal Group Holdings Plc at 25% (2023: 23.5%) and the tax expense recognised in the income statement can be reconciled as follows: 2024 2023 £’000 £’000 Profit before tax 7,728 5,334 Tax rate 25% 23.5% Expected tax expense 1,932 1,253 Adjustment for non-deductible expenses 102 22 Adjustment for tax exempt revenues (689) (458) Other adjustments Effect of tax rate changes on deferred tax – – Tax (credit)/charge in respect of prior years (113) 193 Adjustment for previously non-deductible expenses – – Actual tax expense 1,232 1,010 Continuing operations 1,298 899 Discontinuing operations (66) 111 Current tax expense 977 708 In respect of prior years (113) 193 Deferred tax Origination and reversal of temporary differences 368 109 Effect of tax rate changes – – Total tax 1,232 1,010 11 Earnings per share 2024 2023 Weighted Weighted average Pence average Pence Earnings number of per Earnings number of per £’000 shares share £’000 shares share Basic EPS from continuing operations 5,528 31,226,632 17.7 4,179 31,226,632 13.4 Dilutive effect of shares in Employee Share Ownership Plan 0.0 1,175,648 (0.6) 0.0 750,552 (0.3) Diluted 5,528 32,402,281 17.1 4,179 31,977,184 13.1 The weighted average number of shares shown above excludes unallocated own Company shares held by Personal Group Trustees Ltd. 2024 2023 Weighted Weighted average Pence average Pence Earnings number of per Earnings number of per £’000 shares share £’000 shares share Basic EPS from discontinued operations 968 31,226,632 3.1 145 31,226,632 0.4 Dilutive effect of shares in Employee Share Ownership Plan 0.0 1,175,648 (0.1) 0.0 750,552 (0.0) Diluted 968 32,402,281 3.0 145 31,977,184 0.4 2024 2023 Weighted Weighted average Pence average Pence Earnings number of per Earnings number of per £’000 shares share £’000 shares share Basic EPS from total operations 6,496 31,226,632 20.8 4,324 31,226,632 13.8 Dilutive effect of shares in Employee Share Ownership Plan 0.0 1,175,648 (0.7) 0.0 750,552 (0.3) Diluted 6,496 32,402,281 20.1 4,324 31,977,184 13.5 Overview Strategic Report Governance Financial Statements 89 12 Dividends 2024 2023 Pence per Pence per 2024 2023 share share £’000 £’000 Equity dividends Q2 5.850 5.300 1,829 1,655 Q4 6.500 5.850 2,031 1,829 12.350 11.150 3,860 3,484 Less: amounts paid on own shares (3) (2) Total dividends 12.350 11.150 3,857 3,482 The dividends listed above were paid in the calendar year. 13 Goodwill The carrying amount of goodwill which has been allocated to those cash-generating units can be analysed as follows: Let’s Pay & Connect Reward Total £’000s £’000s £’000s Cost At 1 January 2024 10,575 2,684 13,259 Additions in the year – – – Disposals in the year (10,575) – (10,575) At 31 December 2024 – 2,684 2,684 Amortisation and impairment At 1 January 2024 10,575 – 10,575 Impairment charge for year – – – Disposals in the year (10,575) – (10,575) At 31 December 2024 – – – Net book value at 31 December 2024 – 2,684 2,684 Let’s Pay & Connect Reward Total £’000s £’000s £’000s Cost At 1 January 2023 10,575 2,684 13,259 Additions in the year – – – At 31 December 2023 10,575 2,684 13,259 Amortisation and impairment At 1 January 2023 10,575 – 10,575 Impairment charge for year – – – At 31 December 2023 10,575 – 10,575 Net book value at 31 December 2023 – 2,684 2,684 The net carrying values at 31 December 2024 have been reviewed for impairment. Notes to the Financial Statements continued 13 Goodwill continued Personal Group Holdings Plc | Annual Report and Accounts 2024 90 Pay & Reward Innecto Reward Consulting Limited was acquired by PGH in 2019, and goodwill of £2.1m was recognised as a result of this acquisition. QCG Limited was acquired in 2022 and resulted in goodwill of £0.6m. Both businesses are now treated as one cash generating unit (CGU), this is due to the commonality of their business models and cashflows, as well organisational changes put in place at the end of 2023 which merged the team into one combined consultancy unit. The teams now work in unison under one management structure to deliver pay and reward consultancy to clients. For the purpose of the value in use model, the CGU value is comprised of the total goodwill allocated, the carrying value of the intangible assets recognised on acquisition and the assets of the CGU such that the carrying amount of the CGU has been determined on a basis consistent with the way the recoverable amount of the CGU is determined. An expected cash flow approach was used applying multiple scenarios and affixed probabilities that were deemed to be appropriate under management’s best understanding of the business. Key assumptions Five years of future cash flows were included in the discounted cash flow model, including a long-term growth rate of 2.4% (30-year average of UK consumer price index). These cash flows were then discounted using a risk mitigating post-tax discount rate of 22.5% (2023: 22.4%) based on the CGU’s weighted average cost of capital, using the capital asset pricing model with a risk premium in line with the risks associated with the uncertainties around the forecasted growth. Sensitivity While management are confident that the CGU will generate forecasted income, it is recognised that there is an inherent uncertainty within the forecasted cash flows used in the impairment model. Below is a table showing the sensitivity of the key assumptions and the impact of various changes (in base percentage point terms) on the headroom. The Base column refers to the headroom on the impairment review model completed by management. - % Base + % Sensitivity Analysis – Impact on headroom £’000s £’000s £’000s Discount Rate (+/- 5%) 800 487 232 Terminal Growth Rate (+/- 0.5%) 441 487 532 Overview Strategic Report Governance Financial Statements 91 14 Intangible assets For the year ended 31 December 2024 Pay & Let’s Reward Computer Internally Connect customer software generated customer book and Innecto and website computer value trade name technology development software WIP Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 Cost At 1 January 2024 1,648 1,063 298 2,773 506 2,948 9,236 Transfers – – – 5,256 – (5,256) – Additions in the year – – – 79 – 2,586 2,665 Disposals (1,648) – – (451) – – (2,099) At 31 December 2024 – 1,063 298 7,657 506 278 9,802 Amortisation and impairment At 1 January 2024 1,648 803 290 2,335 506 – 5,582 Amortisation charge for year – 92 8 1,329 – – 1,429 Disposals (1,648) – – (415) – – (2,063) At 31 December 2024 – 895 298 3,249 506 – 4,948 Carrying value at 31 December 2024 – 168 – 4,408 – 278 4,854 Carrying value at 31 December 2023 – 260 8 438 – 2,948 3,654 The Pay & Reward customer values and trademark include acquired intangibles relating to Innecto and QCG. This, and the Innecto technology, is being amortised through the consolidated income statement over a five-year period. The carrying values on 31 December 2024 have been assessed for impairment and no impairment was deemed necessary. The assets were assessed in conjunction with the goodwill value in Note 13. The total value of amortisation relating to acquired intangibles was £100k (2023: £273k). Notes to the Financial Statements continued 14 Intangible assets continued Personal Group Holdings Plc | Annual Report and Accounts 2024 92 For the year ended 31 December 2023 Pay & Let’s Reward Computer Internally Connect customer software generated customer book and Innecto and website computer value trade name technology development software WIP Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 Cost At 1 January 2023 1,648 1,063 298 2,678 506 1,003 7,196 Transfers – – – – – – – Additions in the year – – – 95 – 1,945 2,040 Disposals – – – – – – – At 31 December 2023 1,648 1,063 298 2,773 506 2,948 9,236 Amortisation and impairment At 1 January 2023 1,648 590 230 1,838 506 – 4,812 Amortisation charge for year – 213 60 497 – – 770 Disposals – – – – – – – At 31 December 2023 1,648 803 290 2,335 506 – 5,582 Carrying value at 31 December 2023 – 260 8 438 – 2,948 3,654 Carrying value at 31 December 2022 – 473 68 840 – 1,003 2,384 Overview Strategic Report Governance Financial Statements 93 15 Property, plant and equipment For the year ended 31 December 2024 Freehold land and Motor Computer Furniture fixtures Lease Right of use properties vehicles equipment & fittings improvements assets Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 Cost At 1 January 2024 5,037 53 1,570 2,294 38 2,261 11,253 Acquisitions – – – – – – – Additions – – 99 2 2 643 746 Disposals – (53) (326) (84) (40) (1,074) (1,577) At 31 December 2024 5,037 – 1,343 2,212 – 1,830 10,422 Depreciation At 1 January 2024 2,002 41 1,300 1,633 38 1,219 6,233 Acquisition – – – – – – – Provided in the year 84 6 212 158 – 685 1,145 Eliminated on disposals – (47) (320) (80) (38) (950) (1,435) At 31 December 2024 2,086 – 1,192 1,711 – 954 5,943 Net book amount at 31 December 2024 2,951 – 151 501 – 876 4,479 Net book amount at 31 December 2023 3,035 12 270 661 – 1,042 5,020 In line with IFRS 16, right of use (ROU) assets relate to motor vehicles and building leases, a breakdown for which can be found in Note 29. Notes to the Financial Statements continued 15 Property, plant and equipment continued Personal Group Holdings Plc | Annual Report and Accounts 2024 94 For the year ended 31 December 2023 Freehold land and Motor Computer Furniture fixtures Lease Right of use properties vehicles equipment & fittings improvements assets Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 Cost At 1 January 2023 5,037 157 1,443 2,318 38 1,139 10,132 Acquisitions – – – – – – – Additions – – 127 30 – 1,446 1,603 Disposals – (104) – (54) – (324) (482) At 31 December 2023 5,037 53 1,570 2,294 38 2,261 11,253 Depreciation At 1 January 2023 1,916 134 1,058 1,474 38 873 5,493 Acquisition – – – – – – – Provided in the year 86 11 242 213 – 583 1,135 Eliminated on disposals – (104) – (54) – (237) (395) At 31 December 2023 2,002 41 1,300 1,633 38 1,219 6,233 Net book amount at 31 December 2023 3,035 12 270 661 – 1,042 5,020 Net book amount at 31 December 2022 3,121 23 385 844 – 266 4,639 Overview Strategic Report Governance Financial Statements 95 16 Financial investments Group Company Restated 2024 2023 2024 2023 £’000 £’000 £’000 £’000 Bank deposits 8,319 5,491 4,750 – Equity investments 1,593 1,470 – – Total financial investments 9,912 6,961 4,750 – IFRS 13 Fair Value Measurement establishes a fair value hierarchy that categorises into three levels the inputs to valuation techniques used to measure fair value. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1 inputs) and the lowest priority to unobservable inputs (Level 3 inputs). Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities. All current equity investments are valued using Level 1 inputs. Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3: inputs for the asset or liability that are not based on observable market data (unobservable input). Bank deposits, held at amortised cost, are due within six months and the amortised cost is a reasonable approximation of the fair value. These would be included within Level 2 of the fair value hierarchy. 17 Inventories 2024 2023 £’000 £’000 Finished goods – Salary Sacrifice – 272 Total financial investments – 272 18 Trade and other receivables Group Company Restated 2024 2023 2024 2023 £’000 £’000 £’000 £’000 Loans and receivables: Other receivables due within one year 7,878 13,857 – – Amounts due from subsidiary undertakings – – 157 611 Accrued interest 2 2 – – Other prepayments and accrued income 2,114 2,156 174 192 Total trade and other receivables 9,994 16,015 331 803 All of the Group’s receivables due within one year have been reviewed for indicators of impairment. IFRS 9 compliant credit loss provisions have been made where applicable and the values shown above are net of those provisions. Other receivables include non-insurance trade receivables, and receivables relating to float payments on the e-voucher platform. There have been no significant changes in any contract asset balances during the reporting period. A weighted average ageing of the expected loss provision is shown below: 2024 2023 Trade/ Credit Trade/ Credit Insurance Weighted Loss Insurance Weighted Loss Debtor Average Provision Debtor Average Provision £’000 Provision £’000 £’000 Provision £’000 Not invoiced – – – 3,700 0.3% 9 Current 7,066 0.1% 9 8,687 0.1% 6 30 Days 400 1.0% 4 1,000 1.0% 10 60 Days 200 2.1% 4 275 1.9% 5 90 Days 121 4.1% 5 212 5.7% 12 150 Days 150 24.2% 37 73 66.1% 48 Total 7,937 0.6% 59 13,947 0.6% 90 Notes to the Financial Statements continued 18 Trade and other receivables continued Personal Group Holdings Plc | Annual Report and Accounts 2024 96 Credit Loss Provision 2024 2023 £’000 £’000 Stage 1 – – Stage 2 59 90 Stage 3 – – Total 59 90 Set out below is the movement in the allowance for expected credit losses of trade receivables and contracted assets: 2024 2023 £’000 £’000 At 1 January 90 51 Provision for expected credit losses 59 90 Provision release (90) (51) At 31 December 59 90 In the past, the Group has not incurred significant bad debt write offs and consequently whilst the above may be overdue, the risk of credit default is considered to be low. The Group has no charges or other security over any of these assets. 19 Cash and cash equivalents Group Company Restated 2024 2023 2024 2023 £’000 £’000 £’000 £’000 Cash at bank and in hand 18,335 14,145 37 50 Short-term deposits 725 426 – – Total cash and cash equivalents 19,060 14,571 37 50 20 Share capital 2024 2023 £’000 £’000 Authorised 200,000,000 ordinary shares of 5p each 10,000 10,000 Allotted, called up and fully paid 31,248,822 (2023: 31,248,822) ordinary shares of 5p each 1,562 1,562 Share Premium 1,134 1,134 Each ordinary share is entitled to one vote in any circumstance. The total number of own shares held by the Employee Benefit Trust at 31 December 2024 was 77,242 (2023: 85,396). Of this amount, there are 61232 (2023: 69,955) SIP shares that have been unconditionally allocated to employees. As at 31 December 2024, the Group maintained two share-based payment schemes for employee compensation. a) Company Share Ownership Plan (CSOP) and unapproved options For the options granted to vest, performance criteria obligations are imposed on Executive Directors. For other recipients, there are no conditions other than continuous employment during the three-year period. Exceptions are made for early termination of employment by attaining normal retirement age, ill health or redundancy. All share-based employee compensation will be settled in equity. The Group has no legal or constructive obligation to repurchase or settle the options. Share option and weighted average exercise price are as follows for the reporting periods presented: 2024 2023 Weighted Weighted average average exercise exercise price price Number Pence Number Pence Outstanding at 1 January 266,761 326.5 209,251 387.6 Options granted in year 71,229 168.5 124,993 216.0 Options exercised in year – – – – Options cancelled or lapsed (169,766) 371.7 (67,483) 311.2 Outstanding at 31 December 168,224 214.0 266,761 326.5 20 Share capital continued Overview Strategic Report Governance Financial Statements 97 credit is taken to equity. No liabilities were recognised from share-based transactions. a) Company Share Ownership Plan (CSOP) and unapproved options continued The weighted average exercise price of 55,331 (2023: 128,060) share options exercisable at 31 December 2024 was pence per share 271.09 (2023: 398.34). There were 71,229 options granted under the CSOP scheme in 2024 (2023: 124,993). The weighted average remaining contracted life of outstanding options at 31 December 2024 was eight years and one month (2023: four years and four months). The underlying expected volatility was determined by reference to historical data. No special features imminent to the options granted were incorporated into the measurement of fair value. In total, £24,000 of employee compensation by way of share-based payment expense has been included in the consolidated income statement for 2024 (2023: £23,000). The corresponding credit is taken to equity. No liabilities were recognised due to share-based transactions. b) Long-Term Incentive Plan (LTIP) The Remuneration Committee approved a new LTIP scheme on 4 April 2021. Under the scheme share options of Personal Group Holdings Plc are granted to senior executives with an Exercise Price of 5p (nominal value of the shares). The share options have a market and non-market performance condition which are required to be achieved for the options to vest. The options also contain service conditions that require option holders to remain in employment of the Group. Total shareholder return (market condition) Up to 50% of the awards vest under this condition. Subject to Compound Annual Growth Rate (CAGR) of the Total Shareholder Return (TSR) over the Performance Period. EBITDA targets (non-market condition) Up to 50% of the awards vest under the condition of EBITDA measures over the Performance Period. The fair value of the share options is estimated at the grant date using a Monte-Carlo binomial option pricing model for the market conditions, and a Black-Scholes pricing model for non-market conditions. However, the above performance condition is only considered in determining the number of instruments that will ultimately vest. There are no cash settlements alternatives. The Group does not have a past practice of cash settlement for these share options. The Group accounts for the LTIP as an equity-settled plan. Four tranches of awards have been made to date since April 2021. In total, £178,000 of employee share-based compensation has been included in the consolidated income statement to 31 December 2024 (2023: £146,000). The corresponding Share option and weighted average exercise price are as follows for the reporting periods presented: 2024 2023 Outstanding at 1 January 822,248 791,556 Options granted in year 656,109 653,958 Options exercised in year (13,486) – Options cancelled or lapsed (240,641) (623,266) Outstanding at 31 December 1,224,230 822,248 21 Deferred Taxation 2024 2023 Deferred Deferred Tax Deferred Deferred Tax Tax Assets Liabilities Tax Assets Liabilities £’000 £’000 £’000 £’000 Non-current assets and liabilities Property, plant and equipment 13 1,254 16 826 Intangible Assets – 40 – 57 Share Options 123 – 77 – 136 1,294 93 883 Offset (136) (136) (93) (93) Total deferred tax – 1,158 – 790 2024 2023 £’000 £’000 At 1 January (790) (681) Movement in provisions debited to income statement (368) (109) Movement in provisions due to tax rate changes – – At 31 December (1,158) (790) Notes to the Financial Statements continued Personal Group Holdings Plc | Annual Report and Accounts 2024 98 22 Trade and other payables Current Group Company 2024 2023 2024 2023 £’000 £’000 £’000 £’000 Financial liabilities measured at amortised cost: Amounts owed to subsidiary undertakings – – 4,904 311 Other creditors 9,517 10,466 123 37 Accruals 2,191 2,717 327 231 Right of use creditor 621 559 – – Deferred income 1,723 1,358 – – Total trade and other payables 14,052 15,100 5,354 579 Group Company 2024 2023 2024 2023 Non-Current £’000 £’000 £’000 £’000 Right of use creditor over 1 year 343 567 – – Total 343 567 – – These liabilities are not secured against any assets of the Group. Other creditors include trade creditors and creditors relating to e-vouchers from the platform. 23 Insurance contract liabilities This section shows how the net carrying amounts of insurance contracts issued by the Group have changed during the year, as a result of changes in cash flows and amounts recognised in profit or loss. Insurance liabilities included within the Group’s statement of financial position are made up of multiple components. No loss component is recorded for insurance contracts held. Personal Group has elected not to adjust the liability for remaining coverage for the time value of money as its insurance contracts do not contain a significant financing component. The liability for incurred claims represents the gross estimated liability arising from claim episodes in the current and preceding financial years which have not given rise to claims paid. It is estimated based on current information, and the ultimate liability may vary as a result of subsequent information and events. Adjustments to the amount of claims provision for prior years are included in the Income Statement in the financial year in which the change is made. The valuation of the liability for incurred claims in the Group’s subsidiary, Personal Assurance Plc is estimated by using a Chain Ladder method, and the main assumption underlying this technique is that the Company’s past claims development experience can be used to project future claims development and hence ultimate claims costs. The valuation in the Group’s subsidiary, Personal Assurance Group Guernsey Limited is also estimated based on the Company’s past claims experience to predict future claims and claims costs. It is estimated that the majority of all claims will be paid within 12 months and therefore claims development information is not disclosed. 23 Insurance contract liabilities continued Overview Strategic Report Governance Financial Statements 99 In setting the provision for claims outstanding, a best estimate is determined on an undiscounted basis and then a 10% margin of prudence (risk adjustment) is added such that there is confidence that future claims will be met from the provisions. The Group has estimated the risk adjustment using a confidence level (probability of sufficiency) approach at the 80th percentile. That is, the Group has assessed its indifference to uncertainty as being equivalent to the 80th percentile confidence level less the mean of an estimated probability distribution of the future cash flows. The Group is exposed to insurance credit risk to the extent that premiums yet to be paid may default or not pay in full. The maximum level of this exposure is limited to the amount of unpaid premiums which, at the end of 2024 was £2.2m (2023; £2.5m). Maturity analysis as dictated by IFRS 17 has not been performed here as the Group expects all insurance contracts to mature within 12 months of the reporting date. Liabilities for remaining coverage Liabilities for incurred claims Estimates of the Excluding Loss Loss value of future Risk Component Component cash flows Adjustment Total £’000 £’000 £’000 £’000 £’000 Insurance contract liabilities at 1 January 2024 (1,709) – 2,289 155 735 Insurance revenue (32,166) – – – (32,166) Incurred claims – – 8,279 – 8,279 Insurance operating and claims handling expenses – – 8,395 – 8,395 Changes to liabilities for incurred claims – – 217 24 241 Total insurance service expenses – – 16,891 24 16,915 Insurance service result (32,166) – 16,891 24 (15,251) Premiums received 32,078 – – – 32,078 Claims and other expenses paid – – (8,279) – (8,279) Insurance operating expense cash flows – – (8,394) – (8,394) Total cash flows 32,078 – (16,673) – 15,405 Insurance contract liabilities at 31 December 2024 (1,797) – 2,507 179 889 Notes to the Financial Statements continued 23 Insurance contract liabilities continued Personal Group Holdings Plc | Annual Report and Accounts 2024 100 Liabilities for remaining coverage Liabilities for incurred claims Estimates of the Excluding Loss value of future Component Loss Component cash flows Risk Adjustment Total £’000 £’000 £’000 £’000 £’000 Insurance contract liabilities at 1 January 2023 (1,239) – 2,203 118 1,082 Insurance revenue (28,708) – – – (28,708) Incurred claims – – 6,799 – 6,799 Insurance operating and claims handling expenses – – 7,677 – 7,677 Changes to liabilities for incurred claims – – 80 37 117 Total insurance service expenses – – 14,556 37 14,593 Insurance service result (28,708) – 14,556 37 (14,115) Premiums received 28,238 – – – 28,238 Claims and other expenses paid – – (6,799) – (6,799) Insurance operating expense cash flows – – (7,671) – (7,671) Total cash flows 28,238 – (14,470) – 13,768 Insurance contract liabilities at 31 December 2023 (1,709) – 2,289 155 735 The liability for incurred claims is sensitive to the key assumptions in the table below. It has not been possible to quantify the sensitivity of certain assumptions such as legislative changes or uncertainty in the estimation process. The following sensitivity analysis shows the impact on profit before tax and equity for reasonably possible movements in key assumptions held constant. To demonstrate the impact due to changes in each assumption, assumptions have been changed on an individual basis. The method used for deriving sensitivity information and significant assumptions did not change from the previous period. Change in Impact on profit Assumption before tax Impact on equity Expected loss +5% (120) (90) Risk adjustment +5% (89) (67) Inflation rate +2% (3) (2) 101 24 Company investment in subsidiary undertakings and joint venture Shares in subsidiary undertakings 2024 2023 £’000 £’000 Cost At 1 January 38,518 38,372 Share-based expenses 178 146 At 31 December 38,696 38,518 Amounts written off At 1 January 12,898 12,898 Impairment provision in year – – At 31 December 12,898 12,898 Net book amount at 31 December 25,798 25,620 At 31 December 2024 the Company held 100% of the allotted share capital of the following trading companies, all of which were incorporated in England and Wales, with the exception of Personal Assurance (Guernsey) Limited which is incorporated in Guernsey, and have been consolidated in the Group financial statements. The registered address of all Group entities is John Ormond House, 899 Silbury Boulevard, Central Milton Keynes, MK9 3XL, with the exception of Personal Assurance (Guernsey) Limited whose registered address is Level 5, Mill Court, La Charroterie, St Peter Port, Guernsey, GY1 1EJ. Subsidiary undertaking Nature of business Personal Group Limited Intermediate holding Company Personal Assurance Plc General insurance Personal Assurance Services Limited# Administration services Personal Group Benefits Limited# Employee benefits sales and marketing Personal Group Trustees Limited Trustee for employee share options Personal Management Solutions Limited Employee benefits sales and marketing Berkeley Morgan Group Limited# Berkeley Morgan Group Holding Company Berkeley Morgan Limited+ Independent financial advisers Personal Assurance (Guernsey) Limited Death insurance underwriting services Innecto People Consulting Limited HR consultancy and technology providers Quintige Consulting Group Limited# HR consultancy Multiplelisting Limited Dormant Mutual Benefit Limited Dormant Partake Services Limited Dormant Personal Assurance Financial Services Plc Dormant Berkeley Morgan Healthcare Limited+ Dormant B M Agency Services Limited+ Dormant Berkeley Morgan Property Limited+ Dormant Summit Financial Solutions Limited+ Dormant Summit Financial Holdings Plc+ Dormant Berkeley Morgan Trustees Limited+ Dormant Personal Group Mobile Limited Dormant Universal Provident Limited+ Dormant * Indirectly owned by Personal Group Holdings Plc via Personal Group Limited. + Indirectly owned by Personal Group Holdings Plc via Personal Group Limited and Berkeley Morgan Group Limited. # Exempt from audit under parental guarantee. Overview Strategic Report Governance Financial Statements Notes to the Financial Statements continued 24 Company investment in subsidiary undertakings and joint venture continued Personal Group Holdings Plc | Annual Report and Accounts 2024 102 The following subsidiaries of the Group are exempt from the requirements of the Companies Act 2006 (“the Act”) relating to the audit of individual accounts by virtue of s479A. The parent undertaking, Personal Group Holdings Plc, gives a guarantee to these subsidiaries under section 479C in respect of the year ending 31 December 2024. • Personal Assurance Services Limited – 3194988. • Personal Group Benefits Limited – 3195037. • Berkeley Morgan Group Limited – 3456258. • Quintige Consulting Group Limited – 3773926. 25 Capital commitments The Group has no capital commitments at 31 December 2024 and 31 December 2023. 26 Contingent liabilities There were no contingent liabilities at 31 December 2024 and 31 December 2023. 27 Pensions Group and self-invested personal pension schemes The Group operates a defined contribution Group personal pension scheme for the benefit of certain Directors and employees. The scheme is administered by Aegon UK plc and the funds are held independent of the Group. These schemes are administered by independent third-party administrators and the funds are held independent of the Group. 28 Let’s Connect Disposal On 9 July 2024, the Group completed the disposal of its entire issued share capital of Let’s Connect IT Solutions Limited (“Let’s Connect”), its technology salary sacrifice division to SME HCI Limited (trading as The Perkbox Vivup Group) for a total consideration of £2.5m on a cash-free, debt-free basis. The disposal resulted in a profit on disposal of £1.2m, which has been recognised separately on the face of the Consolidated Income Statement. The disposal aligns with the Group’s strategic focus on its core business areas and accelerated growth, and is not expected to have a material impact on the Group’s continuing operations. In the year ended 31 December 2024, Let’s Connect generated a loss before tax of £265,000 (year-ended 31 December 2023: profit before tax of £256,000). The financial impact of the disposal on the Group’s consolidated financial statements is summarised as follows. £000 Total Consideration Received 2,463 Net Assets of Let’s Connect at Disposal (1,247) Transaction Costs (49) Gain on Disposal 1,167 The net cash inflow/(outflow) arising on disposal was as follows. £000 Cash consideration received 2,463 Let’s Connect cash at disposal (574) Transaction Costs Paid (49) Net Cash Inflow 1,840 The table below shows the results of the discontinued operation which are included in the Consolidated Cash Flow statement for the year ended 31 December 2024. 2024 2023 £’000 £’000 Cash flows from operating activities 2,532 858 Cash flows from investing activities 5 (7) Cash flows from financing activities (2,027) (1,045) Net increase/(decrease) in cash and cash equivalents from discontinued operations 510 (194) 103 Overview Strategic Report Governance Financial Statements 29 Leasing commitments and rental income receivable Amounts recognised in the balance sheet Following the adoption of IFRS 16 the balance sheet at 31 December 2024 includes assets and liabilities relating to Right of Use (ROU) assets as detailed below: 2024 – Right of use assets & lease liabilities Net Book Value Lease of Assets Liability £000 £000 Motor vehicles 876 964 Buildings – – Total 876 964 2023 – Right of use assets & lease liabilities Net Book Value Lease of Assets Liability £000 £000 Motor vehicles 948 1,012 Buildings 94 114 Total 1,042 1,126 The initial valuation of the asset is equal to the discounted lease liability on the inception of the lease and this is depreciated over the shorter of either the life of the asset or the lease term. Amounts recognised in the consolidated statement of profit or loss Depreciation Interest Charge Expense £000 £000 Motor vehicles 655 105 Buildings 30 1 Total 685 106 Total operating lease payments due until the end of the lease, or the first break clause, total £1,063,000 (2023: £1,203,000). An analysis of these payments due is as follows: Amounts recognised in the consolidated statement of profit or loss 2024 2023 £’000 £’000 Total lease payments falling due: Within one year 691 593 Within one to two years 335 482 Within two to five years 37 128 Total 1,063 1,203 Below is a reconciliation of changes in liabilities arising from financing activities: 1 January Cash New 31 December 2024 Flows leases Other 2024 £’000 £’000 £’000 £’000 £’000 Current lease liabilities 559 (614) 482 194 621 Non-current lease liabilities 567 – – (224) 343 Total liabilities from financing activities 1,126 (614) 482 (30) 964 The “Other” column includes the effect of reclassification of non-current leases to current due to the passage of time, the effect of the disposal of lease assets with their related creditors and the effect of the unwinding of the discounted ROU creditors over time. Personal Group Holdings Plc | Annual Report and Accounts 2024 104 Notes to the Financial Statements continued 30 Prior Year Restatement Let’s Connect Disposal Following the Group’s disposal of Let’s Connect on 9th July 2024, Let’s Connect activities have been classified as discontinued operations. As a result, and in accordance with IFRS 5, the prior year income statement has been restated to split out the discontinued operations of Let’s Connect. The Consolidated Income Statement has been restated in these financial statements as follows. The impact on the cash flow statement is reflected in Note 28. Consolidated Income Statement Previous LC Restated 2023 Disposal 2023 £’000 £’000 £’000 Insurance Revenue 28,708 – 28,708 Benefits and Reward Revenue 20,012 (11,081) 8,931 Other income 139 – 139 Investment income 807 – 807 Revenue 49,666 (11,081) 38,585 Insurance Service Expenses (14,593) – (14,593) Net expenses from reinsurance contracts held (135) – (135) Benefits and Reward expenses (18,077) 10,715 (7,362) Other expenses (94) – (94) Group Administration Expenses (11,266) 107 (11,159) Share based payment expenses (169) – (169) Unrealised Losses on Equity Investments 181 – 181 Charitable donations (100) – (100) Expenses (44,253) 10,822 (33,431) Results of operating activities 5,413 (259) 5,154 Finance costs (79) 3 (76) Profit before tax 5,334 (256) 5,078 Tax (1,010) 111 (899) Profit for the period after tax 4,324 (145) 4,179 Discontinued Previous LC Restated 2023 Disposal 2023 £’000 £’000 £’000 Let’s Connect – Income Discontinued – 11,081 11,081 Let’s Connect – Expense – (10,825) (10,825) Let’s Connect – Tax – (111) (111) Profit from discontinued operations – 145 145 Overall Profit 4,324 – 4,324 Reclassification of funds held on deposit As stated in Note 2.11, fixed interest rate bank deposits with the maturity date of three months or more from the date of acquisition are classified as financial assets. The reported balance sheet as at 31 December 2023 included a misallocation of cash held on deposit. These accounts were incorrectly reported as cash rather than financial assets. The prior year Consolidated Balance Sheet and Consolidated Cash Flow Statement have been restated as follows to correct this allocation. There was no impact on the Consolidated Income Statement. Consolidated Balance Sheet Previous Restated 2023 Deposits 2023 £’000 £’000 £’000 Non- Current assets 11,358 – 11,358 Financial Assets 4,035 2,926 6,961 Cash & cash equivalent 17,497 (2,926) 14,571 Current assets 37,831 – 37,831 Total Assets 49,189 – 49,189 Total Equity 31,995 – 31,995 Total Liabilities 17,194 – 17,194 Total Equity & Liabilities 49,189 – 49,189 30 Prior Year Restatement continued Overview Strategic Report Governance Financial Statements 105 Consolidated Cash Flow Statement Previous LC Restated 2023 Disposal 2023 £’000 £’000 £’000 Net cash from operating activities 6,678 – 6,678 Purchase of financial assets (823) (2,926) (3,749) Net cash from investing activities (2,135) (2,926) (5,061) Net cash used in financing activities (4,004) – (4,004) Net change in cash and cash equivalents 539 (2,926) (2,387) Cash and cash equivalents, beginning of the year 16,958 – 16,958 Cash and cash equivalents, end of the year 17,497 (2,926) (14,571) 31 Related party transactions Personal Group Holdings Plc holds a bank account which it uses for payments to Company specific creditors. During 2024 and 2023, the Company paid its own dividends and expenses. A list of intercompany balances that are outstanding at the balance sheet date with subsidiary undertakings is as follows: 2024 2023 Receivable Payable Receivable Payable £’000 £’000 £’000 £’000 Personal Assurance Plc – 2,491 145 – Personal Assurance Services Limited – 37 – 31 Personal Group Benefits Limited – 66 – 31 Personal Assurance Financial Services Plc – 137 – 137 Multiplelisting Limited – 100 – 100 Personal Management Solutions Limited 38 – 27 – Mutual Benefit Limited – 12 – 12 Partake Services Limited 3 – 3 – Personal Group Limited – 2,061 381 – Berkeley Morgan Group Limited 57 – 13 – Innecto People Group Consulting Limited 50 – 42 – Total 148 4,904 611 311 All balances are repayable on demand. None of the balances are secured. All balances relate to intercompany funding balances. Transactions with Directors During the year, no transactions were undertaken with Directors or companies in which Directors were key decision makers. 32 Post balance sheet events There have been no post balance sheet events. Personal Group Holdings Plc | Annual Report and Accounts 2024 106 Company Information Company registration number: 3194991 Registered office: Personal Group Holdings Plc John Ormond House 899 Silbury Boulevard Central Milton Keynes MK9 3XL Telephone: 01908 605000 www.personalgroup.com Directors: M Bennett – Non-Executive Chairman P Constant – Chief Executive S Mace – Chief Financial Officer M Darby-Walker – Senior Non-Executive Director R Head – Non-Executive Director C Astin – Non-Executive Director A Lothian – Non-Executive Director Secretary: J Roberts-Jones Banker: The Lloyds Bank plc 25 Gresham Street London EC2V 7HN Auditor: EY LLP 1 Colmore Square Birmingham B4 6HQ Nominated Broker and Adviser: Canaccord Genuity Limited 88 Wood Street London EC2V 7QR CBP030150 Printed by a Carbon Neutral Operation (certified: CarbonQuota) under the PAS2060 standard. Printed on material from well-managed, FSC™ certified forests and other controlled sources. This publication was printed by an FSC™ certified printer that holds an ISO 14001 certification. 100% of the inks used are HP Indigo ElectroInk which complies with RoHS legislation and meets the chemical requirements of the Nordic Ecolabel (Nordic Swan) for printing companies, 95% of press chemicals are recycled for further use and, on average 99% of any waste associated with this production will be recycled and the remaining 1% used to generate energy. The paper is Carbon Balanced with World Land Trust, an international conservation charity, who offset carbon emissions through the purchase and preservation of high conservation value land. Through protecting standing forests, under threat of clearance, carbon is locked-in, that would otherwise be released. Personal Group Holdings Plc John Ormond House 899 Silbury Boulevard Central Milton Keynes MK9 3XL www.personalgroup.com Personal Group Holdings Plc Annual Report and Accounts 2024