RM PLC - Annual Report 2025 | FinancialReports.eu

RM PLC

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Building

momentum

Annual report and financial statements

for the year ended 30 November 2025

Overview

Highlights of the year

RM at a glance

Building Momentum

Spotlight on Assessment

Our purpose, vision and work

A strong culture in action

Strategic Report

Chair’s statement

Chief Executive’s statement

Our strategy

Market overview

Our business model

Key performance indicators

Investment case

Chief Financial Officer’s statement

Managing the Company’s risks

Emerging risks

Principal risks and uncertainties

Financial viability statement

Sustainability Report

Task Force on Climate-related Financial Disclosures

Environmental metrics

Our people

Workforce

Governance

Non-financial and sustainability information

Section 172 statement

Corporate governance

Board of Directors

Governance at a glance

Corporate Governance Report

Nomination Committee Report

Audit and Risk Committee Report

Remuneration Committee Report

102

ESG Committee Report

114

Directors’ Report

116

Statement of Directors’ responsibilities

120

Directors’ duties statement

121

Financial statements

Independent Auditor’s Report

124

Consolidated financial statements

132

Company financial statements

137

Notes to the financial statements

139

Shareholder information

186

Company information

187

Financial

Statements

RM plc

Annual report and financial statements 2025

122

Overview

Strategic Report

Corporate governance

Financial statements

RM plc

Annual report and financial statements 2025

rm.com

123

In our opinion:

•

the financial statements give a true and fair view of the

state of the group’s and of the parent company’s affairs

as at 30 November 2025 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 United Kingdom

Generally Accepted Accounting Practice; and

•

the financial statements have been prepared in

accordance with the requirements of the Companies

Act 2006.

3. Summary of our audit approach

Key audit matters

Group

•

Revenue recognition

•

Going concern

Materiality

Group

•

Overall materiality: £761,000

•

Performance materiality: £495,000

Parent Company

•

Overall materiality: £475,000

•

Performance materiality: £308,000

Scope

Our audit procedures covered 100% of revenue, 99% of total assets and 99% of profit before tax.

2. 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 public interest 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.

4. Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the group and parent

company financial statements of the current period and include the most significant assessed risks of material misstatement (whether or

not due to fraud) we identified, including 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 group and

parent company financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these

matters.

1. Opinion

We have audited the financial statements of RM PLC (the ‘parent

company’) and its subsidiaries (the ‘group’) for the year ended

30 November 2025, which comprise the consolidated income

statement, the consolidated statement of comprehensive income,

the consolidated and parent company balance sheets, the

consolidated and parent company statements of changes in equity,

the consolidated cash flow statement, and notes to the financial

statements, including significant accounting policies.

The financial reporting framework that has been applied in the

preparation of the group financial statements is applicable law

and UK-adopted International Accounting Standards. The financial

reporting framework that has been applied in the preparation of the

parent company financial statements is applicable law and United

Kingdom Accounting Standards including Financial Reporting

Standard 101 “Reduced Disclosure Framework” (United Kingdom

Generally Accepted Accounting Practice).

RM plc

Annual report and financial statements 2025

124

Independent Auditor’s

Report to the members of RM plc

Report on the audit of the financial statements

5. Revenue recognition

Key audit matter

description

Management is required to make a number of judgements and estimates in accordance with IFRS

15 “Revenue from contracts with customers” in order to account for long term contracts in the

Assessment business, including:

•

identifying the distinct performance obligations in the contracts based on the goods and services

being provided;

•

estimating the total consideration with variable elements including in respect of future script

volumes;

•

allocating the transaction price between performance obligations including estimating the stand-

alone selling price of each performance obligation, which includes assessing an appropriate

margin for scanning and managed services; and

•

determining the timing of revenue recognition, specifically for contracts with multiple

performance obligations and where there is a variable transaction price based on the number of

exam scripts.

These judgements, which the Directors have highlighted as critical accounting judgements in note

2 on page 148 of the financial statements, have a direct and material impact on revenue recognised

in FY25 and subsequent periods.

In addition, the contract modification with the IB for the AOS software necessitated a reassessment

of the identified performance obligations, the stand-alone selling prices assigned to performance

obligations and the timing of revenue recognition. This reassessment involved significant

management judgement in determining whether it was appropriate to recognise material revenue

within FY25. Further details are included within the Audit and Risk Committee report on page 96.

The inherent complexity and judgement involved in applying IFRS 15 to the Assessment division’s

contracts creates a risk of material misstatement in the Group’s financial statements. As a result, the

application of IFRS 15 to these contracts is recognised as a key audit matter for FY25.

How the matter was

addressed in the audit

In response to the key audit matter identified, we performed the following procedures:

•

We obtained an understanding of the key controls relating to the application of IFRS 15 including

review of key judgements and compliance with IFRS 15 requirements and principles;

•

We examined RM’s revenue recognition accounting policy and whether this was consistent with

IFRS 15;

•

We assessed management’s analysis of the performance obligations within individual contracts

and of how the five steps in IFRS 15 should be applied;

•

We audited the revenue recognition calculations for a sample of the most significant contracts

to assess whether the methodology applied was consistent with the group’s revenue recognition

policy and across projects;

•

We examined a sample of underlying contracts to confirm the relevant contract terms had been

appropriately identified and reflected in management’s revenue calculations;

•

We performed detailed audit procedures on the stand-alone selling prices determined

by management for the allocation of transaction prices, which included assessing the

reasonableness of the margin applied where the stand-alone selling price was calculated on a

cost-plus margin basis;

•

We challenged management on the appropriateness of estimates made for variable

consideration for script volumes included in the transaction price;

•

We challenged management’s accounting for the modified IB AOS contract and corroborated

the terms of the contract modification to signed documentation;and

•

We evaluated the financial statement disclosures to consider whether they appropriately

described the Group’s revenue recognition policies, critical accounting judgements, and key

estimates related to customer contracts within the Assessment division.

Key observations

We are satisfied that revenue recognised from the Assessment contracts, including modified

contracts, is materially appropriate.

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Annual report and financial statements 2025

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125

Overview

Strategic Report

Corporate governance

Financial statements

6. Going concern

Key audit

matter

description

Management’s assessment of going concern is set out in the Chief Financial Officer’s Report on pages 38-39 and

accounting policy on pages 140-141.

The Group’s and parent company’s ability to continue as a going concern is sensitive to its liquidity position and its

ability to comply with financial covenants.

At 30 November 2025, the Group had net debt of £50.6m (£51.7m at 30 November 2024) and drawn facilities of

£58.0m (£57.0m at 30 November 2024). The group had a £70.0m committed bank facility as at 30 November 2025

which is due to mature on 5 July 2027.

This facility has two financial covenants, being a quarterly LTM EBITDA (excluding discontinued operations) covenant,

replaced from November 2026 by a quarterly EBITDA leverage test and interest cover test, and a ‘hard’ liquidity

covenant which required the group to have liquidity greater than £7.5m on the last business day of the month, and

liquidity not be below £7.5m at the end of the two consecutive weeks within a month. In addition to the financial

covenants, the facility also contains non-financial covenants including the achievement of milestones relating to the

strategy for disposal of certain non-core assets within the going concern period.

For the purpose of assessing the Group’s ability to continue as a going concern, while the Board believes that all

reasonable worst-cast downside scenarios occurring is highly unlikely, under the Board’s reasonable worst-case

scenario, the Group would continue to comply with covenants under the facility until November 2026 when the

EBITDA covenant would be breached, Devember 2026 when the hard liquidity covenant would be breached, and

February 2027 when the adjusted leverage and interest cover tests would be breached. The Group’s ability to remain

a going concern is therefore sensitive to downside risks (including failure to deliver the forecast new customer wins)

and dependent on the timely execution of management’s planned mitigations. There is therefore a need to critically

assess the feasibility of these actions, the robustness of the forecast assumptions and the ability to continue to meet

all facility milestones relating to the disposal strategy, and the adequacy of covenant headroom in the near term.

Given the Group’s elevated net debt position, reliance on covenant compliance, and the sensitivity of forecasts

to downside scenarios, we consider going concern to be a significant risk for the audit. The Group’s ability to

continue as a going concern is dependent on the successful execution of mitigating actions in the event of adverse

trading conditions, which introduces operational and execution risk. Furthermore, the Group has undergone recent

restructuring initiatives and cost-saving programmes, which may impact the reliability of forecast assumptions and

increase modelling risk.

The Directors’ consideration of the judgements taken and an explanation of the rationale behind these judgements is

set out in Note 2 on page 148, and the Audit & Risk Committee’s consideration of the judgements taken is set out on

page 98.

How the

matter was

addressed

in the audit

In response to the key audit matter, we have performed the following procedures:

•

We have obtained a detailed understanding of the process the group has established for compiling cash flow

forecasts, including the modelling of potential risks and mitigations, as well as the review and approval of the

group’s going concern assessment;

•

We consulted with modelling specialists as part of our audit work to check the mechanical accuracy of the model;

•

We evaluated the consistency of the Directors’ forecasts with other areas of the audit, including the goodwill and

investment and intangibles impairment reviews and forecasts relating to utilisation of the deferred tax asset;

•

We challenged the key assumptions within the going concern assessment with reference to historical trading

performance and current trading uncertainty including the launch of new products, the rate of new customer wins

associated with those products and the annualised impact of cost saving initiatives implemented;

•

We assessed the level of reverse stress that can be applied to the group’s funding position and covenant calculations

before a breach of covenants arises together with an assessment of the likelihood of such circumstances arising;

•

We assessed and challenged the mitigating actions available to the Directors, which may be required to offset the

impact of the forecast performance not being achieved, including whether these actions remained at the discretion

of the Directors;

•

We understood the current status and potential impact of any planned divestment of non-core assets on both the

banking facilities and forecast results from operations;

•

We obtained an understanding of the financing facilities available to the group, including repayment terms and

covenants and made enquiries directly of the banking syndicate to confirm management’s assertions regarding the

continued support of the business and that no non-financial covenants had been breached during the reporting

period or in the period leading up to the approval of the annual report; and

•

We challenged the sufficiency of the group’s disclosure over the going concern basis with reference to our

knowledge and understanding of the assumptions taken by the Directors and FRC guidance.

RM plc

Annual report and financial statements 2025

126

Independent Auditor’s

Report to the members of RM plc

continued

7. Our application of materiality

When establishing our overall audit strategy, we set certain thresholds which help us to determine the nature, timing and extent of our audit

procedures. When evaluating whether the effects of misstatements, both individually and on the financial statements as a whole, could

reasonably influence the economic decisions of the users we take into account the qualitative nature and the size of the misstatements.

Based on our professional judgement, we determined materiality as follows:

Group

Parent company

Overall materiality

£761,000

£475,000

Basis for determining

overall materiality

4.6% of Adjusted EBITDA

0.75% of total assets

Rationale for

benchmark applied

We determined materiality based on adjusted EBITDA (earnings

before interest, tax, deprecation and amortisation, excluding share-

based payments and adjusting items as defined in Note 6) for the

period, which is a more stable underlying results metric reflecting

the performance of core assets and, consequently, the focus of the

users of the accounts.

Total assets is considered to be the

most appropriate benchmark for the

parent company as it is primarily a

holding company.

Performance

materiality

£495,000

£308,000

Basis for determining

performance

materiality

65% of overall materiality

Reporting of

misstatements to the

Audit Committee

Misstatements in excess of £38,000 and misstatements below

that threshold that, in our view, warranted reporting on qualitative

grounds.

Misstatements in excess of £23,700

and misstatements below that

threshold that, in our view, warranted

reporting on qualitative grounds.

Key

observations

We are satisfied that the adoption of the going concern basis of accounting and the disclosure in respect of the

group’s ability to continue as a going concern are appropriate.

8. An overview of the scope of our audit

The group consists of 10 components, located in the UK, India, Australia and the United Arab Emirates.

Full scope audits were performed for 3 components, with 2 components subject to specific audit procedures.

The coverage achieved by our audit procedures was:

92%

Full scope audit

Specific audit procedures

Revenue

100%

Total

assets

99%

Profit

before tax

99%

98%

93%

RM plc

Annual report and financial statements 2025

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127

Overview

Strategic Report

Corporate governance

Financial statements

9. Conclusions relating to going

concern

n 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. For an

explanation of how we evaluated management’s assessment of

the group’s and parent company’s ability to continue to adopt the

going concern basis of accounting and our key observations with

respect to that evaluation, please see the going concern key audit

matter.

Based on the work we have performed, we have not identified

any material uncertainties relating to events or conditions that,

individually or collectively, may cast significant doubt on the

group’s or the parent company’s ability to continue as a going

concern for a period of at least twelve months from when the

financial statements are authorised for issue.

In relation to the entity reporting on how they have applied the

UK Corporate Governance Code, we have nothing material to

add or draw attention to in relation to the directors’ statement in

the financial statements about whether the directors considered it

appropriate to adopt the going concern basis of accounting.

Our responsibilities and the responsibilities of the directors with

respect to going concern are described in the relevant sections of

this report.

10. Other information

The other information comprises the information included in

the annual report other than the financial statements and our

auditor’s report thereon. The directors are responsible for the other

information contained within the annual report. Our opinion on

the financial statements does not cover the other information and,

except to the extent otherwise explicitly stated in our report, we do

not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so,

consider whether the other information is materially inconsistent

with the financial statements or our knowledge obtained in the

course of the audit or otherwise appears to be materially misstated.

If we identify such material inconsistencies or apparent material

misstatements, we are required to determine whether this gives rise

to a material misstatement in the financial statements themselves.

If, based on the work we have performed, we conclude that

there is a material misstatement of this other information, we are

required to report that fact.

We have nothing to report in this regard.

11. Opinions on other matters

prescribed by the Companies Act

2006

In our opinion, the part of the directors’ remuneration report to

be audited has been properly prepared in accordance with 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 the Directors’ Report have been

prepared in accordance with applicable legal requirements.

12. 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 their 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 and the part of

the directors’ remuneration report to be audited 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.

13. Corporate governance statement

We have reviewed the directors’ statement in relation to going

concern, longer-term viability and that part of the Corporate

Governance Statement relating to the parent company’s

compliance with the provisions of the UK Corporate Governance

Code specified for our review by the Listing Rules.

Based on the work undertaken as part of our audit, we have

concluded that each of the following elements of the Corporate

Governance Statement is materially consistent with the financial

statements and our knowledge obtained during the audit:

•

Directors’ statement with regards the appropriateness of

adopting the going concern basis of accounting and any

material uncertainties identified;

•

Directors’ explanation as to their assessment of the group’s

prospects, the period this assessment covers and why the period

is appropriate;

•

Directors’ statement on whether it has a reasonable expectation

that the group will be able to continue in operation and meets its

liabilities;

•

Directors’ statement on fair, balanced and understandable;

•

Board’s confirmation that it has carried out a robust assessment

of the emerging and principal risks;

•

Section of the annual report that describes the review of

effectiveness of risk management and internal control

systems; and

•

Section describing the work of the Audit and Risk Committee.

RM plc

Annual report and financial statements 2025

128

Independent Auditor’s

Report to the members of RM plc

continued

14. Responsibilities of directors

As explained more fully in the directors’ responsibilities statement set out on page 120, the directors are responsible for the preparation of

the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is

necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the group’s and the parent company’s ability to continue

as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the

directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.

15. 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.

16. The extent to which the audit was considered capable of detecting

irregularities, including fraud

Irregularities are instances of non-compliance with laws and regulations.

The objectives of our audit are to obtain sufficient appropriate

audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and

disclosures in the financial statements, to perform audit procedures to help identify instances of non-compliance with other laws and

regulations that may have a material effect on the financial statements, and to respond appropriately to identified or suspected non-

compliance with laws and regulations identified during the audit.

In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to

fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing

and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit.

However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity’s

operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the group audit engagement team:

•

obtained an understanding of the nature of the industry and sector, including the legal and regulatory frameworks that the group and

parent company operate in and how the group and parent company are complying with the legal and regulatory frameworks;

•

inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities,

including any known actual, suspected or alleged instances of fraud; and

•

discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where

the financial statements may be susceptible to fraud.

The most significant laws and regulations were determined as follows:

Legislation /

Regulation

Additional audit procedures performed by the Group audit engagement team

included:

UK-adopted IAS, FRS

101 and Companies

Act 2006

•

Review of the financial statement disclosures and testing to supporting documentation; and

•

Completion of disclosure checklists to identify areas of non-compliance.

Tax compliance

regulations

•

Inspection of advice received from internal / external tax advisors;

•

Consideration of whether any matter identified during the audit required reporting to an appropriate

authority outside the entity; and

•

Consultation with a tax specialist regarding the approach taken to the audit of tax.

Pension legislation

•

Consultation with an auditor’s expert on actuarial valuations and pension legislation, including review of

actuarial disclosures calculated by management’s expert; and

•

Review of disclosures relating to recent changes, court decisions and appeals relating to pension

legislation in light of advice received by management from pension experts.

RM plc

Annual report and financial statements 2025

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129

Overview

Strategic Report

Corporate governance

Financial statements

The areas that we identified as being susceptible to material misstatement due to fraud were:

Risk

Audit procedures performed by the audit engagement team:

Revenue recognition

The audit procedures performed in relation to the Assessment division revenue recognition are documented

in the key audit matter section of our audit report.

We also identified a fraud risk in respect of cut-off for the sales of goods in the Technology and TTS divisions.

Our testing included performing detailed audit procedures on a sample of sales made around the year end,

obtaining evidence to support the period of recognition.

Capitalisation of

internally generated

intangible assets

•

Interviewing relevant personnel to understand the projects capitalised in the period;

•

Verifying the amounts capitalised during the year by reference to underlying payroll records and timesheet

data; and

•

Examining for a sample of projects whether these had been accounted for in line with IAS 38 ‘Intangible

assets’.

Classification of

adjusting items

•

Examining the appropriateness and consistency of adjustments made to expenses in the calculation of

alternative performance measures.

Management

override of controls

•

Testing the appropriateness of journal entries and other adjustments;

•

Assessing whether the judgements made in making accounting estimates are indicative of a potential

bias; and

•

Evaluating the business rationale of any significant transactions that are unusual or outside the normal

course of business.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website

at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

17. Other matters which we are required to address

Following the recommendation of the Audit and Risk Committee, we were appointed by the Board in May 2025 to audit the financial

statements for the year ending 30 November 2025 and subsequent financial periods.

The period of total uninterrupted consecutive appointments is 1 year, covering the year ending 30 November 2025.

The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the group or the parent company and we remain

independent of the group and the parent company in conducting our audit.

Our audit opinion is consistent with the additional report to the audit committee in accordance with ISAs (UK).

18. 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.

In due course, as required by the Financial Conduct Authority (FCA) Disclosure Guidance and Transparency Rules, these financial

statements will form part of the Annual Financial Report prepared in Extensible Hypertext Markup Language (XHTML) format and filed on

the National Storage Mechanism of the UK FCA. This auditor’s report provides no assurance over whether the annual financial report has

been prepared in XHTML format.

Approved by the Board and signed on its behalf by

Graham Ricketts

Senior Statutory Auditor, For and on behalf of RSM UK Audit LLP, Statutory Auditor

Chartered Accountants

25 Farringdon Street, London, EC4A 4AB

4 March 2026

RM plc

Annual report and financial statements 2025

130

Independent Auditor’s

Report to the members of RM plc

continued

RM plc

Annual report and financial statements 2025

rm.com

131

Overview

Strategic Report

Corporate governance

Financial statements

Year ended 30 November 2025

Year ended 30 November 2024

Note

Adjusted

£000

Adjustments

£000

Total

£000

Adjusted

£000

Adjustments

£000

Total

£000

Continuing operations

Revenue

162,069

166,143

Cost of sales

(100,197)

(99,490)

Gross profit

61,872

66,653

Operating expenses

(51,664)

(2,301)

(53,965)

(58,156)

(5,270)

(63,426)

Other operating income

1,258

Expected credit loss

(charge)/credit

(16)

Impairment losses

(9,286)

Profit/(loss) from operations

11,450

(2,301)

9,149

8,595

(14,556)

(5,961)

Finance income

1,084

851

Finance costs

(7,021)

(7,007)

Profit/(loss) before tax

5,513

(2,301)

3,212

2,439

(14,556)

(12,117)

Tax

(1,296)

278

(1,018)

7,366

884

8,250

Profit/(loss) for the year from

continuing operations

4,217

(2,023)

2,194

9,805

(13,672)

(3,867)

(Loss)/profit for the year from

discontinued operations

(1,249)

379

(870)

Profit/(loss) for the year

4,217

(2,023)

2,194

8,556

(13,293)

(4,737)

Earnings per ordinary share on

continuing operations

– basic

4.9p

2.6p

11.8p

(4.6)p

– diluted

4.9p

2.5p

11.7p

(4.6)p

Earnings per ordinary share on

discontinued operations

– basic

(1.5)p

(1.1)p

– diluted

(1.5)p

(1.1)p

Earnings per ordinary share on

total operations

– basic

4.9p

2.6p

10.3p

(5.7)p

– diluted

4.9p

2.5p

10.2p

(5.7)p

Throughout this statement, adjusted profit and EPS measures are stated after adjusting items which are identified by virtue of their size,

nature and incidence. Adjusted measures are used by the Board to monitor and manage the performance of the Group (see Note 6 for

details). The treatment of adjusted items is applied consistently period on period.

The notes on pages 139 to 185 form an integral part of these Financial Statements.

RM plc

Annual report and financial statements 2025

132

Consolidated

income statement

RM plc

Annual report and financial statements 2025

rm.com

133

Overview

Strategic Report

Corporate governance

Financial statements

Note

Year ended

30 November

2025

£000

Year ended

30 November

2024

£000

Profit/(loss) for the year

2,194

(4,737)

Items that will not be reclassified subsequently to profit or loss

Defined benefit pension scheme remeasurements

(2,429)

3,760

Tax on items that will not be reclassified subsequently to profit or loss

607

(848)

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

Fair value (loss)/gain on hedging instruments

(314)

Fair value loss on hedging instruments transferred to the income statement

252

412

Exchange (loss)/gain on translation of overseas operations

(229)

Other comprehensive (expense)/income

(2,113)

3,373

Total comprehensive income/(expense)

(1,364)

Recognised in retained earnings.

Recognised in the hedging reserve.

Recognised in the translation reserve.

The notes on pages 139 to 185 form an integral part of these Financial Statements.

Consolidated statement

of comprehensive income

Consolidated

balance sheet

Note

30 November

2025

£000

30 November

2024

£000

Non-current assets

Goodwill

29,036

29,172

Other intangible assets

14,249

6,818

Property, plant and equipment

6,585

7,249

Right-of-use assets

12,758

12,014

Defined benefit pension scheme surplus

20,093

20,498

Other receivables

353

245

Contract fulfilment assets

5,262

5,661

Deferred tax assets

8,734

8,479

97,070

90,136

Current assets

Inventories

12,987

15,190

Trade and other receivables

26,050

21,723

Contract fulfilment assets

2,720

2,909

Tax assets

121

347

Cash and cash equivalents

6,166

8,196

48,044

48,365

Total assets

145,114

138,501

Current liabilities

Trade and other payables

(41,895)

(41,897)

Provisions

(1,154)

(1,972)

Bank overdraft

(4,325)

(43,049)

(48,194)

Net current assets

4,995

171

Non-current liabilities

Lease liabilities

17, 22

(13,393)

(12,816)

Other payables

(165)

(3,585)

Provisions

(809)

(1,243)

Defined benefit pension scheme obligation

(30)

Borrowings

(56,742)

(55,524)

(71,139)

(73,198)

Total liabilities

(114,188)

(121,392)

Net assets

30,926

17,109

Equity attributable to shareholders

Share capital

2,242

1,917

Share premium account

39,458

27,080

Own shares

(444)

Capital redemption reserve

Hedging reserve

(31)

Translation reserve

(1,060)

(831)

Retained earnings

(9,333)

(10,738)

Total equity

30,926

17,109

The notes on pages 139 to 185 form an integral part of these Financial Statements.

These Financial Statements of RM plc, registered number 01749877, were approved and authorised for issue by the Board of Directors on

4 March 2026.

On behalf of the Board of Directors

Simon Goodwin

Director

RM plc

Annual report and financial statements 2025

134

Consolidated statement

of changes in equity

Note

capital

£000

premium

£000

Own

£000

Capital

redemption

reserve

£000

Hedging

reserve

£000

Translation

reserve

£000

Retained

earnings

£000

Total

£000

At 1 December 2023

1,917

27,080

(444)

(393)

(868)

(9,558)

17,828

Loss for the year

(4,737)

Other comprehensive

income

424

2,912

3,373

Total comprehensive

income/(expense)

424

(1,825)

(1,364)

Transactions with owners of

the Company:

Share-based payments

644

Share-based payments - tax

At 30 November 2024

1,917

27,080

(444)

(831)

(10,738)

17,109

Profit for the year

2,194

Other comprehensive

expense

(62)

(229)

(1,822)

(2,113)

Total comprehensive

(expense)/income

(62)

(229)

372

Transactions with owners

of the Company:

Issue of share capital

325

12,378

12,703

Share-based payments

1,005

Share-based payments - tax

At 30 November 2025

2,242

39,458

(444)

(31)

(1,060)

(9,333)

30,926

The capital redemption reserve arose from the repurchase of issued share capital. It is not distributable.

The Group hedging reserve arises from cash flow hedges entered into by the Group. The reserve is distributable in the entities in which it arises unless it relates to

unrealised gains.

The Group translation reserve arises on consolidation from the unrealised movement of foreign exchange on the net assets of overseas entities. This reserve is not

distributable.

The footnotes to the consolidated statement of comprehensive income show the reserve in which each item of other comprehensive income is recognised.

The notes on pages 139 to 185 form an integral part of these Financial Statements.

RM plc

Annual report and financial statements 2025

rm.com

135

Overview

Strategic Report

Corporate governance

Financial statements

Consolidated

cash flow statement

Note

30 November

2025

£000

30 November

2024

£000

Profit/(loss) before tax from continuing operations

3,212

(12,117)

Loss before tax from discontinued operations

(1,160)

Finance income

(1,084)

(851)

Finance costs

7,021

7,007

Profit/(loss) from operations, including discontinued operations

9,149

(7,121)

Adjustments for:

Research and development expenditure credits

(74)

(61)

Amortisation and impairment of intangible assets

14, 15

395

9,729

Depreciation and impairment of property, plant and equipment

16, 17

3,661

5,568

Impairment of inventory and other current assets

110

261

Amortisation of contract fulfilment asset

6,516

2,470

(Gain)/loss on disposal of property, plant and equipment

(4)

Loss on foreign exchange derivatives

252

412

Share-based payment charge

1,005

644

(Decrease)/increase in provisions

(340)

189

Defined benefit pension scheme past service cost

300

Defined benefit pension scheme administration cost

409

Operating cash flows before movements in working capital

21,079

12,490

Decrease/(increase) in inventories

2,093

(1,492)

(Increase)/decrease in receivables

(5,316)

10,627

Increase in contract fulfilment assets

(4,757)

(4,394)

Decrease in trade and other payables

(2,705)

(3,471)

Utilisation of provisions

(907)

(1,912)

Cash generated from operations

9,487

11,848

Cash paid for settlement of derivative instruments

(252)

(288)

Defined benefit pension scheme cash contributions

(1,355)

(4,270)

Tax (paid)/refunded

(336)

1,084

Net cash generated from operating activities

7,544

8,374

Investing activities

Interest received

100

Proceeds on disposal of property, plant and equipment

Purchases of property, plant and equipment

(986)

(644)

Purchases of other intangible assets

(8,754)

(4,178)

Net cash used by investing activities

(9,730)

(4,722)

Financing activities

Drawdown of borrowings

14,000

8,000

Repayment of borrowings

(13,000)

(6,000)

Borrowing facilities arrangement and commitment fees

(657)

(1,040)

Interest and other finance costs paid

(5,463)

(5,585)

Equity raise - gross proceeds

13,500

Equity raise - fees incurred

(797)

Payment of leasing liabilities - capital element

(2,457)

(3,058)

Payment of leasing liabilities - interest element

(403)

(315)

Net cash generated from/(used by) financing activities

4,723

(7,998)

Net increase/(decrease) in cash and cash equivalents

2,537

(4,346)

Cash and cash equivalents at the beginning of the year

3,871

8,062

Effect of foreign exchange rate changes

(242)

155

Cash and cash equivalents at the end of the year

6,166

3,871

Cash at bank

6,166

8,196

Bank overdraft

(4,325)

Cash and cash equivalents at the end of the year

6,166

3,871

The notes on pages 139 to 185 form an integral part of these Financial Statements.

RM plc

Annual report and financial statements 2025

136

Company

balance sheet

Note

30 November

2025

£000

30 November

2024

£000

Non-current assets

Investments

56,402

55,397

Deferred tax assets

6,077

5,168

62,479

60,565

Current assets

Trade and other receivables

111

Total assets

62,479

60,676

Current liabilities

Trade and other payables

(32,686)

(38,369)

(32,686)

(38,369)

Net current liabilities

(32,686)

(38,258)

Non-current liabilities

Borrowings

(56,742)

(55,524)

(56,742)

(55,524)

Total liabilities

(89,428)

(93,893)

Net liabilities

(26,949)

(33,217)

Equity attributable to shareholders

Share capital

2,242

1,917

Share premium account

39,458

27,080

Own shares

(444)

Capital redemption reserve

Retained earnings

(68,299)

(61,864)

Total equity

(26,949)

(33,217)

The notes on pages 139 to 185

form an integral part of these Financial Statements.

The Company has taken the exemption under s408 of the Companies Act 2006 not to produce an income statement. The loss for the

year was £7,440,000 (2024: £7,302,000 loss) and includes an impairment charge of £nil (2024: £3,199,000) in respect of the Company’s

investment in RM Educational Resources Limited (see Note 18) and a reversal of impairment of £1,007,000 (2024: £276,000 impairment

charge) in respect of an amount owed by a Group undertaking (see Note 20).

These Financial Statements of RM plc, registered number 01749877, were approved and authorised for issue by the Board of Directors on

4 March 2026.

On behalf of the Board of Directors

Simon Goodwin

Director

RM plc

Annual report and financial statements 2025

rm.com

137

Overview

Strategic Report

Corporate governance

Financial statements

Company statement

of changes in equity

Note

capital

£000

premium

£000

Own

£000

Capital

redemption

reserve

£000

Retained

earnings

£000

Total

£000

At 1 December 2023

1,917

27,080

(444)

(55,206)

(26,559)

Loss for the year

(7,302)

Total comprehensive expense

(7,302)

Transactions with owners of the

Company

Share-based payments

644

At 30 November 2024

1,917

27,080

(444)

(61,864)

(33,217)

Loss for the year

(7,440)

Total comprehensive expense

(7,440)

Transactions with owners of the

Company

Issue of share capital

325

12,378

12,703

Share-based payments

1,005

At 30 November 2025

2,242

39,458

(444)

(68,299)

(26,949)

The capital redemption reserve arose from the repurchase of issued share capital. It is not distributable.

The notes on pages 139 to 185 form an integral part of these Financial Statements.

RM plc

Annual report and financial statements 2025

138

Corporate governance

Financial statements

Overview

Strategic Report

rm.com

RM plc

Annual report and financial statements 2025

139

Notes to the

financial statements

1. General information

RM plc (the Company) is a public company, limited by shares,

incorporated in England and Wales and listed on the London Stock

Exchange. It is the parent company and ultimate parent of a group

of companies (the Group) whose business activities and financial

position are presented in the Strategic Report and the Directors’

Report. The registered address is: 142B Park Drive, Milton Park,

Abingdon, Oxfordshire OX14 4SE.

2. Accounting policies

The accounting policies set out below have been consistently

applied to the years presented.

The Financial Statements are prepared on a going concern basis.

The Directors’ reasons for continuing to adopt this basis are set out

below and in the Going Concern section of the Strategic Report.

Basis of preparation

The Financial Statements have been prepared in accordance with

UK-adopted international accounting standards in conformity with

the requirements of the Companies Act 2006. They are prepared

on a historical cost basis except for certain financial instruments,

share-based payments, and pension assets and liabilities which are

measured at fair value. In addition, assets held for sale are stated at

the lower of previous carrying amount and the fair value less costs

to sell.

The preparation of Financial Statements, in conformity with

generally accepted accounting principles, requires the use of

estimates and assumptions that affect the reported amounts

of assets and liabilities and disclosure of contingent assets and

liabilities at the date of the Financial Statements and affect the

reported amounts of revenues and expenses during the reporting

period. Although these estimates are based on the Directors’ best

knowledge of current events and actions, actual results ultimately

may differ from the estimates.

The separate Financial Statements of the Company are drawn up in

accordance with the Companies Act 2006 and Financial Reporting

Standard 101 ‘Reduced disclosure framework’ (FRS 101). The

following exemptions available under FRS 101 have been applied:

• A cash flow statement and related notes;

• Comparative period reconciliations for share capital and tangible

fixed assets;

• Disclosures in respect of transactions with wholly-owned

subsidiaries;

• Disclosures in respect of capital management;

•

The effects of new but not yet effective IFRSs; and

•

Disclosures in respect of the compensation of Key Management

Personnel.

As the consolidated Financial Statements of the Company include

the equivalent disclosures, the Company has also taken the

exemptions under FRS 101 available in respect of the following

disclosures:

•

IFRS 2 Share-Based Payments in respect of Group settled share-

based payments;

•

The requirements in IAS 24 ‘Related party disclosures’ to disclose

related party transactions entered into between two or more

members of a group; and

•

The disclosures required by IFRS 7 and IFRS 13 regarding financial

instrument disclosures have not been provided.

As permitted by s408 of the Companies Act 2006 the Company

has elected not to present its own income statement or statement

of comprehensive income for the year. The loss attributable to

the Company is disclosed in the footnote to the Company’s

balance sheet.

New accounting standards adopted

The Group has applied the following standards and amendments

for the first time in the financial year:

•

Lease Liability in a Sale and Leaseback – Amendments to IFRS 16

Leases;

• Classification of liabilities as Current or Non-Current and

Non-current Liabilities with Covenants – Amendments to IAS 1

Presentation of Financial Statements; and

•

Amendments to IAS 7 Statement of Cash Flows and IFRS

7 Financial Instruments: Disclosures – Supplier Finance

Arrangements.

None of these standards or amendments had a material impact on

the Financial Statements of the Group.

New accounting standards in issue but not

yet effective

At the date of authorisation of these Financial Statements, the

Group has not applied the following new and revised International

Financial Reporting Standards that have been issued but are not yet

effective:

• IFRS 18: Presentation and Disclosure in Financial Statements;

• IFRS 19: Subsidiaries without Public Accountability: Disclosures;

• Amendments to IAS 21: Lack of Exchangeability;

•

Amendments to IFRS 9 and IFRS 7: Amendments to the

Classification and Measurement of Financial Instruments;

• Annual Improvements to IFRS Accounting Standards Volume

11; and

•

Amendments to IFRS 9 and IFRS 7: Power purchase

arrangements.

IFRS 18 introduces new requirements to present specified

categories and defined subtotals in the income statement, provide

disclosures on management-defined performance measures

(MPMs) in the notes to the Financial Statements and improve

aggregation and disaggregation. IFRS 18 was endorsed by the

UK Endorsement Board on 10 December 2025 and will apply for

annual reporting periods beginning on or after 1 January 2027. The

Directors anticipate that the application of IFRS 18 may have an

impact on the Group’s consolidated Financial Statements.

The Directors do not expect that the adoption of the other

standards and amendments listed above will have a material impact

on the Financial Statements of the Group in future periods.

Notes to the

continued

financial statements

continued

2. Accounting policies

140

RM plc

Annual report and financial statements 2025

Going concern

The Financial Statements have been prepared on a going concern

basis. In reaching the conclusion that the going concern basis

of accounting was appropriate the Directors made significant

judgements which are set out below.

The Directors have prepared cash flow forecasts for the period to

the end of March 2027 which indicate that, taking into account

reasonably plausible downsides and associated mitigations as

discussed below, the Company is expected to comply with all debt

covenants in place and will have sufficient funds to meet its liabilities

as they fall due for at least 12 months from the date of this report.

In assessing the going concern position, the Directors have

considered the balance sheet position as included on page 134,

the headroom to the hard liquidity covenant within the banking

agreement, and compliance with the quarterly rolling last twelve

months Adjusted EBITDA (“LTM EBITDA”) covenant, which applies

quarterly to 30 November 2026, and the interest cover and adjusted

leverage covenants that apply quarterly thereafter.

Exceeding any of

the covenants would constitute a material breach of the agreement

and consequently the facility would be repayable on demand.

At 30 November 2025, the Group had net debt of £50.6m

(30 November 2024: £51.7m) and drawn facilities of £58.0m

(30 November 2024: £57.0m). Average Group net debt over the year

to 30 November 2025 was £57.8m (year to 30 November 2024:

£53.8m) with a maximum borrowings position of £63.3m (year to

30 November 2024: £60.7m). The drawn facilities are expected to

fluctuate over the period considered for going concern, but remain

within the covenants, and are not anticipated to be fully repaid in this

period.

As set out in Note 25, the Group has a £70.0m (2024: £70.0m)

committed bank facility (“the facility”) at 30 November 2025. The

facility is due to mature on 5 July 2027. The Directors have assessed

the liquidity risk associated with the facility maturing within the

Principal Risks and Uncertainties on page 42 and the Financial

Viability report on pages 46 to 48, and have concluded that the

uncertainties associated with refinancing are not material to the

going concern assessment and therefore it remains appropriate to

assess going concern over a period of 12 months to March 2027.

The facility agreement provides lenders a fixed and floating charge

over the shares of all obligor companies (except for RM plc), and

it also reset the covenants under the facility. For going concern

purposes the Board has assessed the Group’s forecast performance

against the following covenants:

•

A quarterly LTM (last twelve months) EBITDA covenant test to

November 2026, which is then replaced by a quarterly EBITDA

leverage test and interest cover test, which are required to be

below 4.5x and above 4x respectively from February 2027; and

•

A hard liquidity covenant test requiring the Group to have

liquidity greater than £7.5m on the last business day of the

month, and liquidity not be below £7.5m at the end of two

consecutive weeks within a month. This liquidity limit is the

minimum amount the Group must have available under the

facility, taking into account cash and the amount left to draw.

In addition to the financial covenants, the facility also contains non-

financial covenants including the achievement of milestones relating

to the strategy for disposal of certain non-core assets within the

going concern assessment period.

For going concern purposes, the Group has assessed a base case

scenario that assumes no significant downturn in UK or international

markets from that experienced in the year to 30 November 2025

and assumes a broadly similar macroeconomic environment to that

currently being experienced.

The Group is assuming revenue growth across all businesses in the

base case, driven from the following key areas:

•

Growth from existing customers and new customer wins in the

RM Assessment division;

•

Increased revenues principally derived from hardware and

software sales in the RM Technology division; and

•

Growth from UK and international sales in the RM TTS division.

Operating profit margin growth in the base case includes annualised

savings from restructuring programmes undertaken in the period.

Net debt is not expected to materially reduce organically within the

assessment period, as the conversion of operating profits will be

offset by further capital investment and debt interest payments.

As part of the Group’s business planning process, the Board has

closely monitored the Group’s financial forecasts, key uncertainties

and sensitivities. As part of this exercise, the Board reviewed a

number of scenarios, including the base case and reasonable worst-

case downside scenarios.

The aggregate impact of reasonably plausible downsides has been

taken together to form a reasonable worst-case scenario that

includes:

•

In the RM Assessment division, reduced new and existing

customer growth;

•

In the RM Technology division, reductions in revenue growth

and operating margin improvement targets; and

•

In the RM TTS division, reductions in growth in markets and of

market share.

The reasonable worst-case scenario has the following impact on

the base-case forecast for the Group:

•

FY26: A revenue reduction of £12.2m, an EBITDA reduction of

£7.0m and cash reduction of £8.2m.

•

FY27: A revenue reduction of £15.3m, an EBITDA reduction of

£8.4m and cash reduction of £8.7m.

While the Board believes that all reasonable worst-case downside

scenarios occurring together is highly unlikely, the Group

would continue to comply with covenants under the facility

until November 2026 when the EBITDA covenant would be

breached, December 2026 when the hard liquidity covenant

would be breached, and February 2027 when the adjusted

leverage and interest cover tests would be breached. The Board’s

assessment of the likelihood of a further downside scenario is

remote. Management have undertaken reverse stress testing that

demonstrates that sales could reduce in RM TTS by £13.1m in April

Corporate governance

Financial statements

Overview

Strategic Report

continued

2. Accounting policies

(continued)

Going concern

rm.com

RM plc

Annual report and financial statements 2025

141

2026 or RM Technology by £23.3m in June 2026 in isolation, and

the covenants would still be complied with for that quarter if none

of the other downside scenarios were to occur.

The timing of this reverse stress test is aligned with the greatest

seasonality for those businesses and tightest headroom.

The Board has also considered a number of mitigating actions

which could be enacted, if necessary, to ensure that reasonable

headroom against the facility and associated covenants is

maintained in all cases. These are actions the Group has taken

before and therefore the Board are confident of their ability to

deliver these mitigating actions if required. Modelling indicates that

the enactment of these mitigations against the reasonable worst-

case downside scenario would avoid a breach of all covenants

during the going concern review period.

Management have also met all milestones relating to disposal

strategy to the date of signature of this report, and expect to

continue to meet these through the remainder of the going

concern period.

Therefore, the Board has a reasonable expectation that the

Company has adequate resources to continue in operational

existence and meet its liabilities as they fall due for a period of not

less than 12 months from the date of approval of these Financial

Statements, having considered both the availability of financial

facilities and the forecast liquidity and expected future covenant

compliance. For this reason, the Company continues to adopt

the going concern basis of accounting in preparing the annual

Financial Statements.

Alternative Performance Measures (APMs)

In response to the Guidelines on APMs issued by the European

Securities and Markets Authority (ESMA) and the Financial Reporting

Council (FRC), additional information on the APMs used by the Group

is provided below. The following APMs are used by the Group:

• Divisional contribution

• Divisional contribution margin

• Adjusted profit from operations

• Adjusted operating margin

• Adjusted profit before tax

• Adjusted tax

• Adjusted profit after tax

• Adjusted basic earnings per share

• Adjusted diluted earnings per share

• Adjusted cash conversion

• Adjusted EBITDA

• Adjusted EBITDA excluding share-based payments

• Adjusted net debt

Further explanation of what each APM comprises and reconciliations

between Statutory reported measures and adjusted measures are

shown in Note 6. Divisional contribution is explained in Note 4.

The Board believes that presentation of the Group results in

this way is relevant to an understanding of the Group’s financial

performance (and that of each segment). Adjusted items are

identified by virtue of their size, nature and incidence. The

treatment of adjusted items is applied consistently period on

period. This presentation is consistent with the way that financial

performance is measured by management, reported to the

Board, the basis of financial measures for senior management’s

compensation schemes and provides supplementary information

that assists the user to understand the financial performance,

position and trends of the Group.

The APMs used by the Group are not defined terms under IFRS and

may therefore not be comparable with similarly titled measures

reported by other companies. They are not intended to be a

substitute for, or superior to, GAAP measures. All APMs relate to the

current year results and comparative periods where provided.

Consolidation

The Group Financial Statements incorporate the Financial

Statements of the Company and all its subsidiaries for the periods

during which they were members of the Group.

Inter-company balances and transactions between Group

companies are eliminated on consolidation. On acquisition, assets

and liabilities of subsidiaries are measured at their fair values at the

date of acquisition, with any excess of the cost of acquisition over

this value being capitalised as goodwill.

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.

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.

Investment in subsidiaries

In the Company accounts, investments in subsidiaries are stated at

cost less any provision for impairment where appropriate.

Business combinations

The Group measures goodwill at the acquisition date as:

• The fair value of the consideration transferred; less

•

The net recognised amount (generally fair value) of the

identifiable assets acquired and liabilities assumed.

When the excess is negative, a bargain purchase gain is recognised

immediately in profit or loss.

Costs related to the acquisition, other than those associated with

the issue of debt or equity securities, are expensed as incurred.

Discontinued operations

When the Group has disposed of, has classified as held for sale, or

has abandoned a business component that represents a separate

major line of business or geographical area of operations, it

classifies such operations as discontinued operations. The post-tax

profit or loss of the discontinued operations is shown as a single

Notes to the

continued

financial statements

continued

2. Accounting policies

(continued)

Discontinued operations

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line on the face of the income statement, separate from the other

results of the Group. The income statement for the comparative

periods is restated to show the discontinued operations.

Revenue

The Group operates a number of diverse businesses and

accordingly applies a variety of methods for revenue recognition,

based on the principles set out in IFRS 15.

The revenue and profits recognised in any period are based on the

delivery of performance obligations and an assessment of when

control is transferred to the customer.

RM TTS provides educational supplies and curriculum products for

schools and nurseries, and revenues are recognised when products

are delivered to customers, i.e. point-in-time basis for each product

delivered.

RM Technology provides software, services and technology to UK

schools and colleges. Hardware, right-to-use licences and related

installation revenues are recognised on delivery to customers at a

point in time. Provision of services and right-to-access software are

recognised over time.

RM Assessment provides digital assessment solutions that support

lifelong learning. Revenues are recognised at points in time, or over

time, based on the delivery of performance obligations. In certain

contracts there are judgements in determining the basis of revenue

recognition, particularly for long-term and complex contracts.

RM Assessment revenue judgements

In respect of certain contracts in the RM Assessment division,

management is required to form several judgements and

assumptions. These include judgements that determine the

amount of revenue and profits to record, and related balance

sheet items (such as contract fulfilment assets, trade receivables,

accrued income and deferred income) to recognise in the period.

Judgements and assumptions include:

• The identification of performance obligations included within the

contract;

• The allocation of the transaction price to performance

obligations including the impact of variable consideration;

•

The combination of goods and services into a single

performance obligation;

• The measurement of progress for performance obligations

satisfied over time;

•

The timing of revenue recognition based on the implied start

date of new and renewed contracts; and

•

The estimation of a standalone selling price using the expected

cost plus a margin approach.

The impact on revenue recognition of these judgements and

assumptions is set out below.

The most significant judgements relate to contracts with multiple

performance obligations and where there is a variable transaction

price based on the number of exam scripts. An estimate is made

for scanning and script volumes at contract inception which

is updated at the end of each accounting period. There is also

judgement in the determination that the provision of software is a

right-to-access arrangement and therefore should be recognised

over time, and the basis on which the transaction price is allocated

to separate performance obligations.

These are explained in critical accounting judgements below.

Basis of revenue recognition

Revenue is recognised either when the performance obligation

in the contract has been performed (either ‘point-in-time’

recognition or ‘over-time’ as control of the performance

obligation is transferred to the customer). For all contracts, the

Group determines if the arrangement with a customer creates

enforceable rights and obligations.

For contracts with multiple components to be delivered,

management applies judgement to consider whether these

promised goods or services are; (i) distinct – to be accounted for as

separate performance obligations; (ii) not distinct – to be combined

with other promised goods or services until a bundle is identified

that is distinct; or (iii) part of a series of goods and services that are

substantially the same and have the same pattern of transfer to the

customer.

At contract inception the total transaction price is estimated, being

the amount to which the Group expects to be entitled and has

rights to under the present contract. This includes an assessment

of any variable consideration where the performance obligation is

satisfied over time.

Such amounts are only included based on the expected value or

the most likely outcome method, and only to the extent it is highly

probable that no revenue reversal will occur. The transaction price

does not include estimates of consideration resulting from change

orders for additional goods and services until these are agreed.

Once the total transaction price is determined, the Group allocates

this to the identified performance obligations in proportion to their

relative stand-alone selling prices and recognises revenue when

those performance obligations are satisfied. In the RM Assessment

division the Group may sell customer bespoke solutions, and in

these cases the Group typically uses the expected cost plus a

margin approach to estimate the stand-alone selling price of each

performance obligation. Any remaining performance obligations

for which the stand-alone selling price is highly variable or

uncertain, due to not having previously been sold on a stand-alone

basis, is allocated applying the residual approach. Performance

obligations may also take the form of the delivery of bespoke

software or bespoke software as a service.

For each performance obligation, the Group determines if revenue

will be recognised over time or at a point in time. Where the

Group recognises revenue over time for long-term contracts,

this is generally due to the Group performing and the customer

simultaneously receiving and consuming the benefits provided

over the life of the contract.

For each performance obligation to be recognised over time, the

Group applies a revenue recognition method that faithfully depicts

the Group’s performance in transferring controls of the goods or

services to the customer. This decision requires assessment of the

real nature of the goods or services that the Group has promised

to transfer to the customer. The Group applies the relevant input or

output method consistently to similar performance obligations in

other contracts.

Corporate governance

Financial statements

Overview

Strategic Report

continued

2. Accounting policies

(continued)

Basis of revenue recognition

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143

When using the output method, the Group may recognise revenue

on the basis of direct measurements of the value to the customer

of the goods and services transferred to the date relative to the

remaining goods and services under the contract. Where the

output method is used and where the series guidance is applied

(see below for further details), the Group often uses a method of

time elapsed which requires minimal estimation. Certain long-term

contracts use an output method based on estimation of number

of scripts, or level of service activity. There is variable consideration

relating to the number of scripts.

There is judgement in determining whether a contract has onerous

conditions. Any expected loss is provided for at the time identified.

Revenue: Transactional (point-in-time) contracts

The Group delivers goods and services in the RM Technology

and RM TTS divisions that are transactional, for which revenue is

recognised at the point in time when the control of the goods or

services has transferred to the customer. This may be at the point

of physical delivery of goods and acceptance by a customer, or

when the customer obtains control of an asset or service in a

contract with customer-specified acceptance criteria.

The nature of contracts or performance obligations categorised

within this revenue type includes provision of curriculum and

educational resources for schools and nurseries, provision of IT

hardware goods and installation of IT hardware goods.

Revenue: Over-time contracts

In the RM Technology and RM Assessment divisions, the nature of

contracts and performance obligations is diverse and includes: (i)

outsourced service arrangements in the public and private sectors;

and (ii) right-to-access licences (see below).

The Group considers that the services provided meet the definition

of a series of distinct goods and services as they are: (i) substantially

the same; (ii) have the same pattern of transfer (as the series

constitutes services provided in distinct time increments (e.g. daily,

monthly, quarterly, exam session or annual service) and therefore

treats the series as one performance obligation.

Even if the underlying activities performed by the Group to satisfy

a promise can vary significantly throughout the day and on a day-

by-day basis, that fact, by itself, does not mean the distinct goods

or services are not substantially the same. For the majority of the

over-time contracts with customers in this category, the Group

recognises revenues using the output method as it best reflects the

nature in which the Group is transferring control of the goods or

services to the customer.

Right-to-access licences are those where the Group has a

continuing involvement after the sale or transfer of control to

the customer, which significantly affects the intellectual property

to which the customer has rights. The Group is responsible for

maintenance, continuing support, updates and upgrades and

accordingly the sale of the initial software is not distinct. The

Group’s accounting policy for licences is discussed in more

detail below.

Revenue: Licences

Software licences delivered by the Group can be either

‘right-to-access’ or ‘right-to-use’ licences.

Right-to-access licences require continuous upgrade and updates

for the software to remain useful; all other licences are treated as

right-to-use licences.

The key determinant of whether a licence is right-to-access

is whether the Group is required to undertake activities that

significantly affect the licence intellectual property (or the

customer has a reasonable expectation that it will do so) and the

customer is, therefore, exposed to positive or negative impacts

resulting from those changes.

The Group considers for each contract that includes a separate

licence performance obligation all the facts and circumstances in

determining whether the licence revenue is recognised over time,

or at a point in time from the go-live date of the licence.

Revenue: Contract modifications

The Group’s over-time contracts are often amended for changes in

contract specifications and requirements. Contract modifications

exist when the amendment either creates new, or changes the

existing, enforceable rights and obligations. Material modifications

are predominantly extensions to contracts and cancellation of

exam sessions. The Group considers whether each contract

modification is part of the original contract or is a separate contract

and allocates the transaction price accordingly.

Revenue: Contract fulfilment costs

Contract fulfilment costs are divided into costs that give rise to an

asset, and costs that are expensed as incurred.

If the costs incurred are not within the scope of another standard,

the Group applies the following criteria which, if met, result in

capitalisation: (i) the costs directly relate to a contract or to a

specifically identifiable anticipated contract; (ii) the costs generate

or enhance resources of the entity that will be used in satisfying (or

continuing to satisfy) performance obligations in the future; and

(iii) the costs are expected to be recovered. The assessment of this

criteria requires the application of judgement, in particular at which

point the capitalisation ceases and the performance obligation

begins.

Revenue: Amortisation, de-recognition and impairment

of contract fulfilment assets

The Group amortises contract fulfilment assets over the expected

contract period using a systematic basis that mirrors the pattern in

which the Group transfers control of the service to the customer.

The amortisation charge is included within cost of sales. A contract

fulfilment asset is derecognised either when it is disposed of, or

when no further economic benefits are expected to flow from its

use or disposal.

Management is required to determine the recoverability of contract

fulfilment assets, accrued income and trade receivables. At each

reporting date, the Group determines whether or not the contract

fulfilment assets are impaired by comparing the carrying amount

of the asset to the remaining amount of consideration that the

Group expects to receive, less costs that relate to providing

services under the relevant contract. In determining the estimated

amount of consideration, the Group uses the same principles as it

does to determine the contract transaction price, except that any

constraints used to reduce the transaction price required by IFRS 15

will be removed for the impairment test.

Notes to the

continued

financial statements

continued

2. Accounting policies

144

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Annual report and financial statements 2025

Revenue: Deferred and accrued income

The Group’s customer contracts include a diverse range of

payment schedules dependent upon the nature and type of goods

and services being provided. The Group often agrees payment

schedules at the inception of long-term contracts under which it

receives payments throughout the term of the contracts. These

payment schedules may include progress payments as well as

regular monthly or quarterly payments for ongoing service delivery.

Payments for transactional goods or services may be at delivery

date, in arrears or part payment in advance. There are no material

financing arrangements. Where payments made are greater

than the revenue recognised at the period end date, the Group

recognises a deferred income contract liability for this difference.

Where payments made are less than the revenue recognised at

the period end date, the Group recognises an accrued income

contract asset for this difference. Where accrued income and

deferred income exist on the same contract, these balances are

shown net.

Intangible assets

All intangible assets, except goodwill, are stated at cost less

accumulated amortisation and any accumulated impairment

losses.

Goodwill

Goodwill represents the amount by which the fair value of the

cost of a business combination exceeds the fair value of net assets

acquired. Goodwill is not amortised and is stated at cost less any

accumulated impairment losses.

The recoverable amount of goodwill is tested for impairment

biannually or when events or changes in circumstance indicate

that it might be impaired. Impairment charges are deducted from

the carrying value and recognised immediately in profit or loss. For

the purpose of impairment testing, goodwill is allocated to each of

the Group’s cash generating units. If the recoverable amount of the

cash generating unit is less than the carrying amount of the unit,

the impairment loss is allocated first to reduce the carrying amount

of any goodwill allocated to the unit, and then to the other assets

of the unit pro-rata on the basis of the carrying amount of each

asset in the unit. An impairment loss recognised for goodwill is not

reversed in a subsequent period.

Research and development costs

Research and development costs associated with the development

of software products or enhancements and their related intellectual

property rights are expensed as incurred until all of the following

criteria can be demonstrated, in which case they are capitalised as

an intangible asset:

a. the technical feasibility of completing the intangible asset so that

it will be available for use or sale;

b. an intention to complete the intangible asset and use or sell it;

c. ability to use or sell the intangible asset;

d. how the intangible asset will generate probable future economic

benefits. Among other things, the Group can demonstrate the

existence of a market for the output of the intangible asset or

the intangible asset itself or, if it is to be used internally, the

usefulness of the intangible asset;

e. the availability of adequate technical, financial and other

resources to complete the development and to use or sell the

intangible asset;

f. an ability to measure reliably the expenditure attributable to the

intangible asset during its development; and

g. the Group has the ability to control the asset and it is separately

identifiable. Configuration costs of development activity on a

third-party software as a service (SaaS) solution are not deemed

to be controlled by the Group unless it has the contractual rights

to control that software. Any configuration activity provided by

the SaaS supplier is expensed as incurred. Customisation costs

of development activity on a third-party SaaS solution will only

be capitalised where the Group has a contractual right to control

the asset and it is separately identifiable. Any customisation

activity provided by the SaaS supplier is expensed as incurred. In

the majority of instances where configuration or customisation

on a third-party SaaS solution is performed, the development

work does not meet the criteria of ability to control the asset nor

is it separately identifiable, so is expensed.

The technological feasibility of the Group’s software products

is assessed periodically on an individual basis. Capitalised

development costs are amortised on a straight-line basis over

their useful lives, once the product is available for use. Useful

lives are assessed on a project-by-project basis, within the range

disclosed in the “Amortisation” section below. Amortisation does

not commence until the assets are in use, and there is periodic

assessment for impairment of capitalised development costs that

have not yet commenced amortisation, as explained further below.

Other intangible assets

Expenditure on internally generated goodwill and brands is

recognised in the income statement as incurred. Other intangible

assets that are acquired by the Group are stated at cost less

accumulated amortisation and accumulated impairment losses.

Amortisation

Amortisation is charged to the income statement on a straight-line

basis over the estimated useful lives of intangible assets unless such

lives are indefinite. Goodwill is not amortised, but is systematically

tested for impairment at each balance sheet date.

Other intangible

assets are amortised from the date they are available for use. The

estimated useful lives are as follows:



Customer relationships	3 – 5 years
Brands	15 years
Intellectual property and database assets	3 – 10 years
Other software assets	2 – 8 years

Property, plant and equipment

Property, plant and equipment assets are stated at cost less

accumulated depreciation, and any accumulated impairment

losses where appropriate.

Property, plant and equipment are depreciated on a straight-line

basis to write down the assets to their estimated disposal value at

the end of their useful lives as follows:



Short leasehold improvements	The term of the lease
Plant, equipment and fixtures	3 – 10 years
Computer equipment	2 – 5 years
Vehicles	2 – 4 years

Corporate governance

Financial statements

Overview

Strategic Report

continued

2. Accounting policies

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Annual report and financial statements 2025

145

Impairment of tangible and intangible assets

excluding goodwill

At each balance sheet date, the Group reviews the carrying amounts

of its tangible and intangible assets to determine whether there is

any indication that those assets have suffered an impairment loss.

If any such indication exists, the recoverable amount of the asset is

estimated in order to determine the extent of any impairment loss.

Where the asset does not generate cash flows that are independent

from other assets, the Group estimates the recoverable amount of

the cash generating unit to which the asset belongs.

The recoverable amount is the higher of fair value less costs to sell

and value in use. If fair value is not directly observable, valuation

techniques will be applied using relevant observable inputs.

In assessing value in use, the estimated future cash flows are

discounted to their present value using a pre-tax discount rate that

reflects current market assessments of the time value of money and

the risks specific to the asset for which the estimates of future cash

flows have not been adjusted.

If the recoverable amount of an asset (or cash generating unit)

is estimated to be less than its carrying amount, the carrying

amount of the asset (or cash generating unit) is reduced to its

recoverable amount. An impairment loss is recognised as an expense

immediately.

Where an impairment loss subsequently reverses, the carrying

amount of the asset (or cash generating unit) is increased to the

revised estimate of its recoverable amount, but so that the increased

carrying amount does not exceed the carrying amount that would

have been determined had no impairment loss been recognised for

the asset (or cash generating unit) in prior periods. A reversal of an

impairment loss is recognised as income immediately.

Financial instruments

Trade and other receivables

Trade and other receivables are recognised initially at fair value and

subsequent to initial recognition they are measured at amortised cost

using the effective interest method, less any impairment losses.

The Group assesses on a forward-looking basis the expected credit

losses associated with its receivables carried at amortised cost. The

impairment methodology applied depends on whether there has

been a significant increase in credit risk. For trade receivables, the

Group applies the simplified approach permitted by IFRS 9, resulting

in trade receivables recognised and carried at original invoice amount

less an allowance for any uncollectible amounts based on expected

credit losses.

Accrued income is recognised when services are performed and

revenue recognised in advance of an invoice being raised, and is

reviewed for impairment at each balance sheet date.

Cash and cash equivalents

Cash comprises cash at bank and in hand and deposits with a

maturity of three months or less from initial investment. Bank

overdrafts are included in cash only to the extent that the Group

has the unconditional right of set-off and intention to net settle or

realise simultaneously. Cash and cash equivalents in the cash flow

statement include overdrafts where they form an integral part of

the Group’s cash management.

Borrowings

Borrowings relate to an unsecured revolving cash facility, detailed

in Note 25. All loans and borrowings are initially recognised at their

fair value less any directly attributable transaction costs. After initial

recognition, loans and borrowings are subsequently measured at

amortised cost using the effective interest method.

Trade and other payables

Trade payables on normal terms are not interest bearing. Trade and

other payables are recognised initially at fair value and subsequent

to initial recognition they are measured at amortised cost using the

effective interest method.

Derivative financial instruments

The Group holds derivative financial instruments to hedge its

foreign currency exposure.

On initial designation of the derivative as the hedging instrument,

the Group formally documents the relationship between

the hedging instrument and hedged item, including the risk

management objectives and strategy in undertaking the hedge

transaction and the hedged risk, together with the methods that

will be used to assess the effectiveness of the hedging relationship.

The Group makes an assessment, both at the inception of the

hedge relationship as well as on an ongoing basis, as to whether

the hedging instruments are expected to be ‘highly effective’

in offsetting the changes in the fair value or cash flows of the

respective hedged items attributable to the hedged risk. For a

cash flow hedge of a forecast transaction, the transaction should

be highly probable to occur and should present an exposure to

variations in cash flows that could ultimately affect reported profit

or loss.

Derivatives are recognised initially at fair value and attributable

transaction costs are recognised in profit or loss as incurred.

Subsequent to initial recognition, derivatives are measured at fair

value, and changes therein are accounted for as described below.

Fair value measurements are classified using a fair value hierarchy.

Cash flow hedges

When a derivative is designated as the hedging instrument in a

hedge of the variability in cash flows attributable to a particular risk

associated with a recognised asset or liability or a highly probable

forecast transaction that could affect profit or loss, the effective

portion of changes in the fair value of the derivative is recognised

in other comprehensive income and presented in the hedging

reserve in equity. Any ineffective portion of changes in the fair

value of the derivative is recognised immediately in profit or loss.

For all hedging of forecast financial transactions, the associated

cumulative gain or loss is removed from equity and recognised in

the income statement in the same period or periods during which

the hedged expected future cash flows affect profit or loss.

When the hedging instrument is sold, expires, is terminated

or exercised, or the entity revokes designation of the hedge

relationship but the hedged forecast transaction is still expected to

occur, the cumulative gain or loss at that point remains in equity

and is recognised in accordance with the above policy when the

transaction occurs.

Notes to the

continued

financial statements

continued

2. Accounting policies

(continued)

Cash flow hedges

146

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Annual report and financial statements 2025

If the hedged transaction is no longer expected to take place,

the cumulative unrealised gain or loss recognised in equity

is recognised in the income statement immediately. When a

derivative financial instrument is not designated in a hedge

relationship that qualifies for hedge accounting, all changes in its

fair value are recognised immediately in profit or loss.

Inventories

Finished goods are valued at cost on a first in first out basis,

including appropriate labour costs and other overheads.

Inventories are recognised when the Group has the rights and

obligations of ownership, which in the case of supply from certain

overseas territories may be from the point of production or the

point of shipment. All inventories are reduced to net realisable

value where lower than cost. Provision is made for obsolete, slow

moving and defective items where appropriate.

Provisions

A provision is recognised if, as a result of a past event, the Group

has a present legal or constructive obligation that can be estimated

reliably, 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 current market assessments of

the time value of money and the risks specific to the liability. The

unwinding of the discount is recognised as a finance cost.

Restructuring

Restructuring provisions are recognised only when the Group has a

constructive obligation, which is when (i) there is a detailed formal

plan that identifies the business or part of the business concerned,

the location and number of employees affected, the detailed

estimate of the associated costs, and the timeline; and (ii) the

employees affected have been notified of the plan’s main features.

Onerous contracts

A provision for onerous contracts is recognised when the expected

benefits to be derived by the Group from a contract are lower than

the unavoidable cost of meeting its obligations under the contract.

The provision is measured at the present value of the lower of

the expected cost of terminating the contract and the expected

net cost of continuing with the contract. Before a provision is

established, the Group recognises any impairment loss on the

assets associated with that contract.

Dilapidations provision

A dilapidations provision is recognised when the Group has an

obligation to rectify, repair or reinstate a leased premises to a

certain condition in accordance with the lease agreement.

The

provision is measured at the present value of the estimated cost of

rectifying, repairing or reinstating the leased premises at a specified

future date.

Leases

A right of use asset and corresponding lease liability are recognised

at commencement of the lease.

The lease liability is measured at the present value of the lease

payments, discounted at the rate implicit in the lease. Where this

rate is not determinable, the Group’s incremental borrowing rate

is used, which is the interest rate the Group would have to pay to

borrow the amount necessary to obtain an asset of similar value, in

a similar economic environment with similar terms and conditions.

The lease liability is subsequently measured at amortised cost

increased for interest charges (using the effective interest rate

method) and reduced for payments. Amendment to lease terms

resulting in a change in payments or the length of the lease results

in an adjustment to the right-of-use asset and liability.

The right of use asset is initially measured at cost, comprising the

initial lease liability, any lease payments already made less any

lease incentives received, initial direct costs, and any dilapidation

or restoration costs. The right of use asset is subsequently

depreciated on a straight-line basis over the shorter of the lease

term or the useful life of the underlying asset.

Right-of-use assets are reviewed for impairment when events or

changes in circumstances indicate the carrying value may not be

fully recoverable.

Payments in respect of short-term leases and low-value leases are

charged to the income statement on a straight-line basis over the

lease term.

Share-based payments

The Group operates a number of executive and employee share

schemes. For all grants of share-based payments, the fair value

as at the date of grant is calculated using a pricing model and the

corresponding expense is recognised over the vesting period.

Where the vesting period is shortened after the date of grant,

the remaining expense is recognised over the shortened vesting

period. Over the vesting period and at vesting, the cumulative

expense is adjusted to take into account the number of awards

expected to vest, or actually vesting as a result of the effect of

non-market-based performance conditions. Share-based payment

charges which are incurred by a subsidiary undertaking are

included as an increase in investments in subsidiary undertakings

within the parent company, and a capital contribution in the

subsidiary.

Employee benefits

Defined benefit pension schemes

The Group has both defined benefit and defined contribution

pension schemes. There are four defined benefit pension

schemes, the Research Machines plc 1988 Pension Scheme (the

RM Scheme), the Consortium CARE Scheme (the CARE Scheme),

and the Platinum Scheme, and a number of Local Government

Pension Schemes which the Group has members within. The RM

Scheme and the CARE Scheme are both operated for employees

and former employees of the Group only. The Platinum Scheme

is a multi-employer scheme, with the Group being just one of

a number of employers. The number of the Group’s former

employees in that Scheme is small and so the impact/risk to the

Group from that Scheme is limited.

For all defined benefit pension schemes, based on the advice of

a qualified independent actuary at each balance sheet date and

using the projected unit method, the administrative expenses

and current service costs are charged to operating profit, with

the interest cost, net of interest on scheme assets, reported as a

financing item.

Corporate governance

Financial statements

Overview

Strategic Report

continued

2. Accounting policies

(continued)

Defined benefit pension schemes

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Annual report and financial statements 2025

147

Defined benefit pension scheme remeasurements are recognised

as a component of other comprehensive income such that the

balance sheet reflects the scheme’s surplus or deficit as at the

balance sheet date. Contributions to defined contribution plans are

charged to operating profit as they become payable.

Scheme assets are measured at bid-price, where available, at

30 November 2025. Please see note 24 for details of the valuation

measurements for liability-driven investments and insurance assets.

The present value of the defined benefit obligation was measured

using the projected unit method.

At 30 November 2025, the RM, CARE and Platinum defined benefit

schemes show a surplus. Under the guidance of IFRIC 14, the

Group are able to recognise a pension surplus on the balance

sheet for all three schemes.

Employee Share Trust

The Employee Share Trust, which holds ordinary shares of

the Company in connection with certain share schemes, is

consolidated into the Financial Statements. Any consideration

paid to the Trust for the purchase of the Company’s own shares

is shown as a movement in shareholders’ equity. The Employee

Share Trust is treated as a branch in the consolidated Financial

Statements.

Own shares held

The ‘Own Shares Reserve’ figure is calculated based on the

number of shares held by the Employee Share Trust (EST) as

at 30 November 2025 (being 618,796 shares) multiplied by the

weighted average cost of those shares.

Translation reserve

The translation reserve comprises all foreign exchange differences

from the translation of the Financial Statements of foreign

operations. This is not distributable.

Cash flow hedging reserve

The hedging reserve comprises the effective portion of the

cumulative net change in the fair value of cash flow hedging

instruments related to hedged transactions that have not yet

occurred. Only realised gains are distributable.

Taxation

Current tax, including UK corporation tax and foreign tax, is

provided at amounts expected to be paid or recovered using

the tax rates and laws that have been enacted (or substantively

enacted) by the balance sheet date.

Deferred taxation is accounted for using the balance sheet

liability method in respect of temporary differences arising from

differences between the carrying amount of assets and liabilities

in the Financial Statements and the corresponding tax bases

used in computation of taxable profit. Deferred tax liabilities are

recognised for all taxable temporary differences except in respect

of investments in subsidiaries where the Group is able to control

the reversal of the temporary difference and it is probable that the

temporary difference will not reverse in the foreseeable future.

Current tax balances are offset when there is a legally enforceable

right to set off current tax assets against current tax liabilities.

Deferred tax assets are recognised to the extent that it is probable

that future taxable profit will be available against which the

temporary difference can be utilised. Their carrying amount is

reviewed at each balance sheet date on the same basis.

Deferred tax is measured on an undiscounted basis, and at the tax

rates that are expected to apply in the periods in which the asset or

liability is settled. It is recognised in the income statement except

when it relates to items credited or charged directly to equity or

other comprehensive income, in which case the deferred tax is

also dealt with in equity or other comprehensive income. Deferred

tax assets and liabilities are offset when they relate to income taxes

levied by the same taxation authority and when the Group intends

to settle its current tax assets and liabilities on a net basis.

Foreign currencies

The Group presents its Financial Statements in pounds sterling

because this is the currency in its primary operating environment.

Balance sheet items of subsidiary undertakings whose functional

currency is not pounds sterling are translated into pounds sterling

at the period-end rates of exchange. Income statement items

and the cash flows of subsidiary undertakings are translated at

the average rates for the period. Foreign exchange differences on

the translation of subsidiary opening net assets at closing rates

of exchange and the differences arising between the translation

of profits at average and closing exchange rates are recorded as

movements in the currency translation reserve.

Transactions denominated in foreign currencies are translated into

pounds sterling at rates prevailing at the dates of the individual

transactions. Foreign currency monetary assets and liabilities

are translated at the rates prevailing at the balance sheet date.

Exchange gains and losses arising are charged or credited to the

income statement. Foreign currency non-monetary amounts are

translated at rates prevailing at the time of establishing the fair value

of the asset or liability.

Foreign exchange differences arising on a specific intercompany

loan with a foreign subsidiary are treated as finance income or

finance costs in line with the underlying asset.

Foreign exchange

differences arising from intercompany loans that are part of a

net investment in a foreign operation are recognised in other

comprehensive income.

The functional currency of the Company is pounds sterling.

Dividends

Dividends are recognised as a liability in the period in which the

shareholders’ right to receive payment has been established.

Key sources of estimation uncertainty

In applying the Group’s accounting policies, the Directors are

required to make estimates and assumptions. Actual results may

differ from these estimates. The Group’s key risks are set out in the

Strategic Report and give rise to the following estimations which

are disclosed within the relevant note to the Financial Statements.

•

Retirement benefit scheme valuation

– The present value

of post-employment benefit obligations is determined on an

actuarial basis using various assumptions, including the discount

rate, inflation rate and mortality assumptions. The latter includes,

within the Continuous Mortality Investigation future mortality

projections model (CMI_2024), a half-life parameter to set how

quickly the influence of the modelled impact of the COVID-19

pandemic falls away. Any changes in these assumptions,

Notes to the

continued

financial statements

continued

2. Accounting policies

(continued)

Key sources of estimation uncertainty

148

RM plc

Annual report and financial statements 2025

including an assessment of an appropriate half-life parameter by

the Group’s pension advisors, will impact the carrying amount as

well as the net pension finance cost or income. Key assumptions

and sensitivities for post-employment benefit obligations are

disclosed in Note 24.

•

Impairment reviews

– As part of the impairment review of

goodwill and investments in subsidiary undertakings, calculating

the net present value of the future cash flows requires

estimates to be made in respect of highly uncertain matters

including future cash flows (including revenue growth, margin

assumptions and corporate costs allocated to the RM TTS

cash-generating unit), discount rates and long-term growth

rates. Changes in the assumptions could significantly affect

the impairment of the RM TTS cash-generating unit and hence

reported assets, profits or losses. Further details, including a

sensitivity analysis, are set out in Notes 14 and 18.

•

Inventory provision

– A provision is made for obsolete, slow

moving and defective items where appropriate. Estimates are

made in respect of the provision percentages, based upon

historic net realisable values for similar product lines. These

provision percentages are applied to inventory quantities based

upon an expectation of utilisation of that inventory in the

future, taken from sales of those lines in the last twelve months.

Changes in future sales volumes or recoverable amounts could

impact the future carrying value of inventory.

•

Deferred tax asset

– As noted above, deferred tax assets are

recognised to the extent it is probable that future taxable profit

will be available against which the temporary difference will be

utilised.

Within short-term timing differences (see Note 10) an

asset in respect of disallowed tax-interest expense has been

recognised on the basis of the expectation of divestment of non-

core assets from the Group in the foreseeable future.

Critical accounting judgements

•

Going concern

– In concluding the going concern assessment

was appropriate, the Directors have made a number of

significant judgements as set out above.

•

Revenue from RM Assessment contracts

– A number of

contracts were entered into or renewed in the year, which

together contributed £3.2m of revenue. Judgements have been

made which impact on the quantum and timing of revenue

recognition. These include: 1) determining the implied start date

of the contract when services commence prior to a contract

being signed, this judgement being based on the point at which

the Group has an enforceable right to payment for goods or

services provided; 2) identifying the term of the contract and

specifically whether this period is reduced based on the ability

of the customer to terminate without incurring a substantive

cost; 3) identifying the distinct performance obligations in the

contracts based on the goods and services being provided,

specifically whether programme management, integration,

development, enhanced software and hosting services are

distinct; 4) allocating the transaction price between performance

obligations based on the customer’s ability to benefit from

the services provided at the inception of contract, including

estimating the stand-alone selling price of each performance

obligation; and 5) determining the timing of revenue recognition,

specifically for contracts with multiple performance obligations

and where there is a variable transaction price based on the

number of exam scripts, there is judgement in the determination

that the provision of technology is a right-to-access arrangement

and therefore should be recognised over time. The factors

considered in making these judgements were the nature of

services provided, including hosting, ongoing maintenance and

system support.

•

International Baccalaureate AOS

– On 30 November 2025, a

contract modification was signed that allowed management to

revisit performance obligations identified in the previous contract.

Management concluded that a performance obligation had been

met during the year ended 30 November 2025, that enabled

the IB to consume the benefits of the developed software via a

perpetual licence, leading to £6.8m of revenue being recognised,

which includes an amount based on the margin attributed to

services provided of 25%. If the margin was 5% higher, revenue

would be £0.05m lower. If the margin was 10% higher, revenue

would be £0.1m lower. The recognition of this revenue was

made on the basis that the development of the software was the

dominant component of the contract and the economic benefits

from the asset have been realised through the transfer of licensed

materials to the IB, who can now determine its future use.

•

Recognition of pension surplus

– The Group has determined

that when all members leave the RM, CARE and Platinum defined

benefit pension schemes, any surplus remaining would be

returned to the Group in accordance with the trust deed. As such,

the full economic benefit of any surplus under IAS 19 is deemed

available to the Group and is recognised in the balance sheet. The

net pension surplus at 30 November 2025 of £20.1m is set out in

Note 24.

•

Classification of adjusting items

– A number of judgements are

made in identifying costs and income as adjusting items. The

factors considered in making this judgement are the size or nature

of the adjustment and their impact on the segment. These are

fully set out in Note 6.

•

Recognition of internally generated intangible assets

– The

Group applies judgement in determining whether research and

development costs incurred in the year meet the qualifying criteria

set out in IAS 38 for the capitalisation of development costs. Only

when these criteria are considered to have been met does the

Group recognise the related internally generated intangible assets.

Particular uncertainty concerns whether the asset will generate

probable future economic benefits. This judgement is based on

budgets and forecasts produced by management, and historic

take up of contract extensions or additional scope work with

current customers. The Group recognised £8.1m of internally

generated intangible assets in the year as shown in Note 15.

•

Deferred tax liability on pension surplus

– The Group has chosen

to classify the deferred tax liability arising from its pension surplus

within the net deferred tax balance (see Note 10) rather than

showing it net of the pension surplus (see Note 24). The Group

does not plan to withdraw any of the surplus and therefore

considers separation of the related deferred tax liability from the

pension surplus to be appropriate.

Corporate governance

Financial statements

Overview

Strategic Report

rm.com

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Annual report and financial statements 2025

149

3. Revenue

Revenue by reportable segment for continuing operations



	RM	RM	RM	RM
	TTS	Technology	Technology	Assessment
	Transactional	Transactional	Over Time	Over Time	Total
Year ended 30 November 2025	£000	£000	£000	£000	£000
Supply of products and software licences	67,221	16,504	1,449	-	85,174
Rendering of services	-	3,104	21,941	17,966	43,011
Delivery of Own Platform solutions	-	42	4,181	29,661	33,884
	67,221	19,650	27,571	47,627	162,069



	RM	RM	RM	RM
	TTS	Technology	Technology	Assessment
	Transactional	Transactional	Over Time	Over Time	Total
Year ended 30 November 2024 (re-presented1)	£000	£000	£000	£000	£000
Supply of products and software licences	72,440	16,284	1,865	-	90,589
Rendering of services	-	6,689	24,726	14,411	45,826
Delivery of Own Platform solutions	-	97	4,334	25,297	29,728
	72,440	23,070	30,925	39,708	166,143

The classes of revenue by product type have been revised in FY25 to align with the classes used by management to assess performance of the business and the

comparatives have been re-presented.

Revenue for RM Consortium for the year ended 30 November 2024 is shown in Note 11 Discontinued operations.

Each contract is analysed separately to identify the performance obligations and judgements made as to whether, for example, goods

and services should be combined. For some contracts judgement is also required to allocate the transaction price to each performance

obligation based on the standalone selling price or, for licences, the residual amount. Judgements include determination of performance

obligations and allocation of the transaction price to performance obligations. Within RM Assessment scanning revenues of £7.4m (2024:

£6.8m) are judged to be delivered over time. The associated transaction price will be dependent on over-time variables (such as volumes).

The over-time period for scanning related revenues is over exam sessions, but this relatively short time span may fall into different external

reporting periods.

Revenue is then recognised based on these judgements which are set out in more detail in Note 2. There is estimation relating to total

script volumes to determine the transaction price over the life of the contract. The revenue recognised in 2025 is not materially sensitive

to these assumptions due to the timing of contract start and end dates. The sensitivity analysis related to future script volumes shows that

if UK and International exams increased by 5% against assumed volumes from 2026 onwards, then revenue in 2025 would be increased by

c.£0.3m (2024: 5% against assumed volumes from 2025 onwards, then revenue in 2024 would be increased by c.£0.1m).

The table below shows the time bands of the expected timing of revenue to be recognised on over-time contracts at 30 November 2025.



	RM	RM
	Technology	Assessment	Total
	Over Time	Over Time	Over Time
Year ended 30 November 2025	£000	£000	£000
< 1 year	1,648	37,583	39,231
1-2 years	3,323	26,004	29,327
2-5 years	5,302	31,680	36,982
> 5 years	1,547	250	1,797
Total	11,820	95,517	107,337

Notes to the

continued

financial statements

continued

3. Revenue

150

RM plc

Annual report and financial statements 2025

| | | | |
| --- | --- | --- | --- |
| | RM | RM | |
| | Technology | Assessment | Total |
| | Over Time | Over Time | Over Time |
| Year ended 30 November 2024 | £000 | £000 | £000 |
| < 1 year | 3,842 | 30,935 | 34,777 |
| 1-2 years | - | 26,757 | 26,757 |
| 2-5 years | - | 23,863 | 23,863 |
| > 5 years | - | 14,147 | 14,147 |
| Total | 3,842 | 95,702 | 99,544 |

The order book represents the consideration the Group will be entitled to receive from customers when the Group satisfies the remaining

performance obligations that are not yet met from contracts in place at the balance sheet date. However, the total revenue that will be

earned from the order book in future may change through non-contracted volumetric revenue, scope changes and contract extensions.

These elements have been excluded from the figures in the table above as they are not contracted.

4. Operating segments

The Group’s business is supplying products, services and solutions to the UK and international education markets. The Chief Executive is

the Chief Operating Decision Maker. Information reported to the Chief Executive for the purposes of resource allocation and assessment

of segmental performance is by division.

The Group is structured into three operating divisions: RM TTS, RM Assessment and RM Technology. RM Consortium was classified as

discontinued operations in 2024 and therefore ceased to be a reportable segment.

The Chief Operating Decision Maker reviews segments at an adjusted operating profit level. Adjustments are not allocated to segments.

A full description of each revenue-generating division, together with comments on its performance and outlook, is given in the

Strategic Report. Corporate Services consists of central business costs associated with being a listed company and non-division-specific

pension costs.

The segmental analysis below shows the result and assets by division. Revenue is that earned by the Group from third parties. Net

financing costs and tax are not allocated to segments as the funding, cash and tax management of the Group are activities carried out by

the central treasury and tax functions.

Segment results from continuing operations


	RM	RM	RM	Corporate
	TTS 1	Assessment	Technology	Services	Total
Year ended 30 November 2025	£000	£000	£000	£000	£000
Revenue
UK	50,437	19,638	46,875	-	116,950
Europe	9,555	19,839	28	-	29,422
North America	1,843	-	318	-	2,161
Asia	622	2,279	-	-	2,901
Middle East	3,658	570	-	-	4,228
Rest of the world	1,106	5,301	-	-	6,407
	67,221	47,627	47,221	-	162,069
Divisional contribution	7,387	16,594	8,359	(20,890)	11,450
Corporate cost allocation	(3,199)	(5,705)	(4,820)	13,724	-
Adjusted profit/(loss) from operations	4,188	10,889	3,539	(7,166)	11,450
Finance income					1,084
Finance costs					(7,021)
Adjusted profit before tax					5,513
Adjustments (see Note 6)					(2,301)
Profit before tax					3,212

Included in UK are International Sales via UK Distributors of £0.6m.

Corporate governance

Financial statements

Overview

Strategic Report

continued

4. Operating segments

rm.com

RM plc

Annual report and financial statements 2025

151

| | | | | | |
| --- | --- | --- | --- | --- | --- |
| | |
| | RM | RM | RM | Corporate | |
| | TTS

2 | Assessment | Technology | Services | Total |
| Year ended 30 November 2024 | £000 | £000 | £000 | £000 | £000 |
| Revenue | | | | | |
| UK | 53,691 | 21,787 | 53,870 | - | 129,348 |
| Europe | 11,086 | 10,957 | 82 | - | 22,125 |
| North America | 2,653 | 11 | 43 | - | 2,707 |
| Asia | 865 | 1,303 | - | - | 2,168 |
| Middle East | 3,047 | 250 | - | - | 3,297 |
| Rest of the world | 1,098 | 5,400 | - | - | 6,498 |
| | 72,440 | 39,708 | 53,995 | - | 166,143 |
| Divisional contribution | 8,865 | 14,436 | 9,526 | (24,232) | 8,595 |
| Corporate cost allocation | (3,509) | (7,492) | (5,976) | 16,977 | - |
| Adjusted profit/(loss) from operations | 5,356 | 6,944 | 3,550 | (7,255) | 8,595 |
| Finance income | | | | | 851 |
| Finance costs | | | | | (7,007) |
| Adjusted profit before tax | | | | | 2,439 |
| Adjustments (see Note 6) | | | | | (14,556) |
| Loss before tax | | | | | (12,117) |

Included in UK are International Sales via UK Distributors of £0.9m.

Segmental assets



	RM	RM	RM	Corporate
	TTS	Assessment	Technology	Services	Total
At 30 November 2025	£000	£000	£000	£000	£000
Segmental	37,503	31,503	11,046	29,948	110,000
Other					35,114
Total assets					145,114



	RM	RM	RM	Corporate
	TTS	Assessment	Technology	Services	Total
At 30 November 2024	£000	£000	£000	£000	£000
Segmental	40,328	20,985	8,783	30,885	100,981
Other					37,520
Total assets					138,501

Included within the disclosed segmental assets are non-current assets (excluding defined benefit pension surplus and deferred tax assets)

of £62.7m (2024: £54.9m) located in the United Kingdom, £4.8m (2024: £5.2m) located in Australia and £0.8m (2024: £1.0m) located

in India. Other non-segmented assets include defined benefit pension surplus, tax assets, and cash and short-term deposits. Goodwill is

included within the Corporate Services segment.

Notes to the

continued

financial statements

152

RM plc

Annual report and financial statements 2025

5. Profit/(loss) from operations

Operating expenses of continuing operations comprise:

| | | | |
| --- | --- | --- | --- |
| | |
| | | Year ended | Year ended |
| | | 30 November | 30 November |
| | | 2025 | 2024 |
| | Note | £000 | £000 |
| Operating expenses | | 53,965 | 63,426 |
| Other operating income

1 | | (1,258) | - |
| Expected credit loss charge/(credit) | | 16 | (98) |
| Impairment losses | 6 | - | 9,286 |
| | | 52,723 | 72,614 |
| Analysed by function: | | | |
| Selling and distribution costs | | 18,697 | 19,965 |
| Research and development costs | | 2,747 | 3,075 |
| Administrative expenses | | 28,978 | 35,018 |
| Adjusted operating expenses | | 50,422 | 58,058 |
| Adjustments to administrative expenses | 6 | 2,301 | 14,556 |
| Total operating expenses | | 52,723 | 72,614 |

Other operating income is derived from the sale of surplus Internet Protocol v4 licences within the RM Technology division. While these sales are expected to be

periodic, they are not classified as revenue as they are not derived from the Group’s ordinary course of business.

Profit/(loss) from operations is stated after charging/(crediting):



		Year ended	Year ended
		30 November	30 November
		2025	2024
	Note	£000	£000
Impairment of goodwill – charged in operating expenses	6, 14	-	9,286
Impairment of property, plant and equipment – charged in operating expenses	16	-	186
(Impairment reversal)/impairment of right-of-use assets – charged in operating expenses	17	(81)	638
Amortisation of other intangible assets – charged in cost of sales	15	112	21
Amortisation of other intangible assets – charged in operating expenses	15	283	422
Depreciation of property, plant and equipment – charged in cost of sales	16	762	649
Depreciation of property, plant and equipment – charged in operating expenses	16	773	1,056
Depreciation of right-of-use assets – charged in operating expenses	17	2,316	2,708
Depreciation of right-of-use assets – charged in discontinued operations	17	-	331
For continuing operations:
(Gain)/loss on disposal of property, plant and equipment		(4)	72
Cost of inventories recognised as expense		50,239	54,419
Staff costs	7	63,127	63,617
Short-term and low value lease expense		34	35
Foreign exchange loss		401	612
Inventory write-offs		110	261
Decrease in inventory obsolescence provision		(54)	(44)

Corporate governance

Financial statements

Overview

Strategic Report

continued

5. Profit/(loss) from operations

rm.com

RM plc

Annual report and financial statements 2025

153

| | | |
| --- | --- | --- |
| | |
| | Year ended | Year ended |
| | 30 November | 30 November |
| | 2025 | 2024 |
| | £000 | £000 |
| Fees payable to the Company’s previous auditor for the audit of these Financial Statements: | | |
| – the audit of the Company’s Financial Statements | - | 60 |
| – the audit of the Company’s subsidiaries pursuant to legislation | 492 | 886 |
| Fees payable to the Company’s current auditor for the audit of these Financial Statements: | | |
| – the audit of the Company’s Financial Statements | 48 | - |
| – the audit of the Company’s subsidiaries pursuant to legislation | 722 | - |
| Other fees payable to the Company’s current auditor: | | |
| – other services

1 | 10 | 10 |
| | 1,272 | 956 |

Fees for other services comprises a review of compliance with the banking facility covenants.

6. Alternative performance measures

As set out in Note 2, the Group uses alternative performance measures that the Board believes reflect the trading performance of the

Group, and it is these adjusted measures that the Board use as the primary measures of performance measurement during the year.

Adjustments

Adjustments are items which are identified by virtue of their size, nature and incidence to be important to understanding the performance

of the business including the comparability of the results year-on-year. These items can include (but are not restricted to) impairments,

restructuring and acquisition costs, the gain/loss on sale of assets and related transaction costs, and the gain/loss on sale of operations.



		Year ended 30 November 2025			Year ended 30 November 2024
		Continuing	Discontinued		Continuing	Discontinued
		operations	operations	Total	operations	operations	Total
		£000	£000	£000	£000	£000	£000
Adjustments to administrative expenses
Amortisation of acquisition-related
intangible assets	(a)	(237)	-	(237)	(369)	-	(369)
Impairment of RM TTS goodwill	(b)	-	-	-	(9,286)	-	(9,286)
Impairment reversal of
RM Consortium assets	(c)	-	-	-	-	505	505
Restructuring costs	(d)	(1,830)	-	(1,830)	(4,591)	-	(4,591)
Consortium pension costs	(e)	(234)	-	(234)	-	-	-
Independent business review
related costs	(f)	-	-	-	(10)	-	(10)
Cost of GMP conversion (see Note 24)	(g)	-	-	-	(300)	-	(300)
Total adjustments to administrative
expenses		(2,301)	-	(2,301)	(14,556)	505	(14,051)
Total adjustments		(2,301)	-	(2,301)	(14,556)	505	(14,051)
Tax impact (see Note 10)		278	-	278	884	(126)	758
Total adjustments after tax		(2,023)	-	(2,023)	(13,672)	379	(13,293)

Notes to the

continued

financial statements

continued

6. Alternative performance measures

154

RM plc

Annual report and financial statements 2025

The following costs and income were identified as adjusted items:

(a)

Amortisation of acquired intangibles is included within adjustments because it relates to historical business combinations and does not

reflect the Group’s ongoing trading performance. This practice is common among peer companies across the technology sector. The

income generated from the use of these intangible assets is, however, part of ongoing trading performance and so is included in the

adjusted profit measures.

(b) An impairment of the goodwill allocated to the RM TTS cash generating unit was recognised in 2024 (see Note 14).

(c)

Following the announcement of the closure of the Consortium business and the subsequent termination of the ERP replacement

programme in 2023, management performed an impairment review resulting in the Group recognising a total impairment charge of

£38.9m, including £2.8m for inventory write-downs to expected net realisable value. During 2024, the Group wrote back £0.5m of

inventory provisions previously recognised in 2023.

(d) Restructuring costs of £1.8m (2024: £4.6m) relating to the implementation of the Group’s new Target Operating Model announced

in 2023, and the legal and operational separation of the divisions announced in the HY25 interim results. These include £0.9m of

redundancy costs (of which £0.9m were paid during the year), £0.8m of professional fees and contractor costs, and £0.5m of staff

costs, offset by a £0.1m reversal of impairments and provisions for properties exited in FY24 following termination of leases, and a

£0.3m reversal of other costs.

(e)

Ongoing costs for the CARE pension scheme are presented as an adjusting item within continuing operations as they are not related

to the underlying trading operations of the Group, following the discontinuation of the Consortium business.

(f)

Independent Business Review related costs undertaken on behalf of the lenders and pension scheme.

(g) Pension past service cost of Guaranteed Minimum Pension (GMP) conversion relating to the RM Scheme.

Adjusted profit measures

Adjusted operating profit is defined as the profit from continuing operations before excluding the adjustments referred to above. Operating

margin is defined as the operating profit as a percentage of revenue.

The above adjustments have the following impact on key metrics:


	Year ended 30 November 2025			Year ended 30 November 2024
	Statutory		Adjusted	Statutory		Adjusted
	measure	Adjustment	measure	measure	Adjustment	measure
	£000	£000	£000	£000	£000	£000
Revenue	162,069	-	162,069	166,143	-	166,143
Profit/(loss) from operations	9,149	(2,301)	11,450	(5,961)	(14,556)	8,595
Operating margin (%)	6%		7%	(4)%		5%
Profit/(loss) before tax	3,212	(2,301)	5,513	(12,117)	(14,556)	2,439
Tax	(1,018)	278	(1,296)	8,250	884	7,366
Profit/(loss) after tax	2,194	(2,023)	4,217	(3,867)	(13,672)	9,805
Profit/(loss) from operations	9,149	(2,301)	11,450	(5,961)	(14,556)	8,595
Amortisation and impairment of
intangible assets	395	237	158	9,729	9,655	74
Depreciation and impairment of property,
plant and equipment	3,770	(81)	3,851	5,237	824	4,413
EBITDA	13,314	(2,145)	15,459	9,005	(4,077)	13,082
Share-based payments	1,005	-	1,005	644	-	644
EBITDA excluding share-based payments¹	14,319	(2,145)	16,464	9,649	(4,077 )	13,726
Earnings per share from continuing
operations (see Note 12)
Basic (Pence)	2.6	-	4.9	(4.6)	-	11.8
Diluted (Pence)	2.5	-	4.9	(4.6)	-	11.7

¹Adjusted EBITDA has been amended to exclude share-based payment charges or credits on the basis they are non-cash. The comparative has accordingly been restated.

The impact of tax is set out in Note 10.

Corporate governance

Financial statements

Overview

Strategic Report

continued

6. Alternative performance measures

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155

Cash conversion (adjusted)

Cash conversion (adjusted) is defined as adjusted cash flows from operating activities1 divided by adjusted operating profit.



	Year ended 30 November 2025			Year ended 30 November 2024
	Statutory		Adjusted	Statutory		Adjusted
	Measure	Adjustment	measure	Measure	Adjustment	measure
	£000	£000	£000	£000	£000	£000
Net cash generated from/(used by)
operating activities	7,544	(2,325)	9,869	8,374	(5,242)	13,616
Profit/(loss) from operations	9,149	(2,301)	11,450	(5,961)	(14,556)	8,595
Cash conversion (%)	82%		86%	(140)%		158%

Adjusted cash flows from operating activities is determined by removing any non-cash adjusting items included in the adjustments identified at the start of Note 6.

Adjusted net debt

Adjusted net debt is the total of borrowings less capitalised fees, cash and cash equivalents and overdrafts. Lease liabilities of £15.4m (2024:

£15.0m) are excluded from this measure as they are not included in the measurement of adjusted net debt for the purpose of covenant

calculations. Adjusted net debt is a key metric measured by management as it is used in covenant calculations. The details of the covenant

calculations are set out in Note 31.



		2025	2024
	Note	£000	£000
Bank loan		58,000	57,000
Less capitalised fees		(1,258)	(1,476)
Borrowings	25	56,742	55,524
Add: bank overdraft		-	4,325
Less: cash and cash equivalents		(6,166)	(8,196)
Adjusted net debt		50,576	51,653

7. Staff numbers and costs

The average number of persons (including Directors) employed by the Group during the year was as follows:



	Year ended	Year ended
	30 November	30 November
	2025	2024
	Number	Number
Research and development, products and services	1,041	1,189
Marketing and sales	218	192
Corporate Services	284	263
	1,543	1,644

Aggregate emoluments of persons employed by the Group comprised:



	Year ended 30 November 2025			Year ended 30 November 2024
	Continuing	Discontinued		Continuing	Discontinued
	operations	operations	Total	operations	operations	Total
	£000	£000	£000	£000	£000	£000
Wages and salaries	54,178	-	54,178	55,228	588	55,816
Termination costs	340	-	340	1,094	-	1,094
Social security costs	5,361	-	5,361	4,610	-	4,610
Pension costs (Note 24)	2,243	-	2,243	2,041	-	2,041
Share-based payments expense (Note 28)	1,005	-	1,005	644	-	644
	63,127	-	63,127	63,617	588	64,205

Information regarding the remuneration of the Directors is shown in the Remuneration Report.

The Company had no employees during the year (2024: nil).

Information regarding the remuneration of key management personnel, which consisted of the Group’s Directors and members of the

Executive management team, is set out in Note 32.

Notes to the

continued

financial statements

156

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8. Finance income

| | | | |
| --- | --- | --- | --- |
| | | Year ended | Year ended |
| | | 30 November | 30 November |
| | | 2025 | 2024 |
| | Note | £000 | £000 |
| Bank interest | | 6 | 18 |
| Other finance income | | - | 86 |
| Total income from financial assets measured at amortised cost | | 6 | 104 |
| Net interest income on defined benefit pension schemes | 24 | 1,078 | 747 |
| | | 1,084 | 851 |

9. Finance costs

| | | | |
| --- | --- | --- | --- |
| | | Year ended | Year ended |
| | | 30 November | 30 November |
| | | 2025 | 2024 |
| | Note | £000 | £000 |
| Borrowing facilities arrangement fees and commitment fees | | 875 | 1,209 |
| Unwinding of discount on provisions | 23 | 58 | 78 |
| Foreign exchange losses | | 222 | 187 |
| Interest on lease of liabilities | | 403 | 315 |
| Interest on bank loans and overdrafts | | 5,463 | 5,218 |
| | | 7,021 | 7,007 |

10. Tax

Analysis of tax charge/(credit) in the consolidated income statement

| | | |
| --- | --- | --- |
| | Year ended | Year ended |
| | 30 November | 30 November |
| | 2025 | 2024 |
| | £000 | £000 |
| Current taxation | | |
| UK corporation tax | 75 | 71 |
| Adjustment in respect of prior years | (55) | 58 |
| Foreign tax | 618 | 487 |
| Total current tax charge | 638 | 616 |
| Deferred taxation | | |
| Temporary differences | 352 | (9,218) |
| Adjustment in respect of prior years | 42 | 48 |
| Overseas tax | (14) | 14 |
| Total deferred tax charge/(credit) | 380 | (9,156) |
| Total consolidated income statement tax charge/(credit) | 1,018 | (8,540) |
| Included in continuing operations | 1,018 | (8,250) |
| Included in discontinued operations | - | (290) |
| | 1,018 | (8,540) |

The tax impact of a transaction or item can be uncertain until a conclusion is reached with the relevant tax authority or through a legal

process. The Group uses in-house and external professional advisors, where appropriate, to assess uncertain tax positions. The most

significant judgement concerns transactions with non-UK entities. The Group recognises an uncertain tax provision if it is considered

probable that there will be a future outflow of funds to a tax authority.

Corporate governance

Financial statements

Overview

Strategic Report

continued

10. Tax

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Analysis of tax (credit)/charge in the consolidated statement of comprehensive income



	Year ended	Year ended
	30 November	30 November
	2025	2024
	£000	£000
Deferred tax
Defined benefit pension scheme movements	(607)	848
Total consolidated statement of comprehensive income tax (credit)/charge	(607)	848

Analysis of tax credit in the consolidated statement of changes in equity



	Year ended	Year ended
	30 November	30 November
	2025	2024
	£000	£000
Deferred tax
Share-based payments	(28)	(1)
Total consolidated statement of changes in equity tax credit	(28)	(1)

Reconciliation of consolidated income statement tax charge/(credit)

Year ended 30 November 2025



	Continuing operations			Discontinued operations			Total
	Adjusted	Adjustment	Total	Adjusted	Adjustment	Total
	£000	£000	£000	£000	£000	£000	£000
Profit on ordinary activities
before tax	5,513	(2,301)	3,212	-	-	-	3,212
Tax at 25% thereon	1,378	(575)	803	-	-	-	803
Effects of:
– Expenses not deductible for tax
purposes	417	322	739	-	-	-	739
– Non-taxable income	(4)	-	(4)	-	-	-	(4)
– Other temporary timing
differences: UK	(365)	-	(365)	-	-	-	(365)
– Other temporary timing
differences: Overseas	(239)	(25)	(264)	-	-	-	(264)
– Effect of (profits)/losses in various
overseas tax jurisdictions	58	-	58	-	-	-	58
– Prior period adjustments - UK	28	-	28	-	-	-	28
– Prior period adjustments - overseas	(41)	-	(41)	-	-	-	(41)
– Other	64	-	64	-	-	-	64
Tax charge/(credit) in the
consolidated income statement	1,296	(278)	1,018	-	-	-	1,018

The tax impact on the adjustments set out in Note 6 is as follows:



	Continuing operations		Discontinued operations
	Charge	Tax credit	Income	Tax charge
	£000	£000	£000	£000
Amortisation of acquisition-related intangible assets	(237)	(84)	-	-
Restructuring costs	(1,830)	(135)	-	-
Consortium pension costs	(234)	(59)	-	-
	(2,301)	(278)	-	-

Notes to the

continued

financial statements

continued

10. Tax

Year ended 30 November 2024

158

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	Continuing operations			Discontinued operations			Total
	Adjusted	Adjustment	Total	Adjusted	Adjustment	Total
	£000	£000	£000	£000	£000	£000	£000
Loss on ordinary activities before tax	2,439	(14,556)	(12,117)	(1,665)	505	(1,160)	(13,277)
Tax at 25% thereon	610	(3,640)	(3,030)	(416)	126	(290)	(3,320)
Effects of:
– Expenses not deductible for tax
purposes	323	2,714	3,037	-	-	-	3,037
– Non-taxable income	(4)	-	(4)	-	-	-	(4)
– Other temporary timing
differences: UK	(146)	(6)	(152)	-	-	-	(152)
– Other temporary timing
differences: overseas	564	58	622	-	-	-	622
– Effect of (profits)/losses in various
overseas tax jurisdictions	(59)	(10)	(69)	-	-	-	(69)
– Previously recognised deferred tax
now unrecognised	(9,032)	-	(9,032)	-	-	-	(9,032)
– Prior period adjustments: UK	176	-	176	-	-	-	176
– Prior period adjustments: overseas	(60)	-	(60)	-	-	-	(60)
– Other	262	-	262	-	-	-	262
Tax (credit)/charge in the
consolidated income statement	(7,366)	(884)	(8,250)	(416)	126	(290)	(8,540)

The tax impact on the adjustments set out in Note 6 is as follows:


	Continuing operations		Discontinued operations
	Charge	Tax credit	Income	Tax charge
	£000	£000	£000	£000
Amortisation of acquisition-related intangible assets	(369)	(92)	-	-
Impairment of RM TTS goodwill	(9,286)	-	-	-
Impairment reversal of RM Consortium assets	-	-	505	126
Restructuring costs	(4,591)	(715)	-	-
Independent business review related costs	(10)	(2)	-	-
Cost of GMP conversion	(300)	(75)	-	-
	(14,556)	(884)	505	126

Corporate governance

Financial statements

Overview

Strategic Report

continued

10. Tax

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159

Deferred tax

The Group has recognised deferred tax assets as these are anticipated to be realised in future periods based on profit forecasts. The major

deferred tax assets and liabilities recognised by the Group and the movements thereon are as follows:



		Defined-benefit		Short-term		Acquisition-
	Accelerated	pension scheme	Share-based	timing		related
	depreciation	obligation	payments	differences	Losses	intangible assets	Total
Group	£000	£000	£000	£000	£000	£000	£000
At 1 December 2023	609	(2,958)	86	166	2,734	(467)	170
Charge/(credit) to income
statement	10	(1,196)	62	(63)	10,224	119	9,156
Charge to other
comprehensive income	-	(848)	-	-	-	-	(848)
Credit to equity	-	-	1	-	-	-	1
At 30 November 2024	619	(5,002)	149	103	12,958	(348)	8,479
Transfer between
categories1	-	-	-	1,730	(1,730)	-	-
(Charge)/credit to income
statement	(235)	(507)	214	1,303	(1,239)	84	(380)
Credit to other
comprehensive income	-	607	-	-	-	-	607
Credit to equity	-	-	28	-	-	-	28
At 30 November 2025	384	(4,902)	391	3,136	9,989	(264)	8,734

Analysed on the balance sheet as:



	2025	2024
	£000	£000
Deferred tax assets	8,734	8,479
At 30 November	8,734	8,479



	Short-term timing differences	Losses	Total asset
Company	£000	£000	£000
At 1 December 2023	-	-	-
Credit to income statement	-	5,168	5,168
At 30 November 2024	-	5,168	5,168
Transfer between categories1	900	(900)	-
Credit to income statement	715	194	909
At 30 November 2025	1,615	4,462	6,077

During the year, for the Group and Company, deferred tax assets arising from corporate interest restrictions were reclassified from losses to short-term timing differences

as this is considered a more appropriate classification.

All deferred tax assets and liabilities have been offset above.

The UK companies operate a group relief payment policy which provides for the receipt of a tax credit/(charge) for losses surrendered/(claimed)

between UK Group companies. A deferred tax asset has been recognised by the Company, based on the group relief payment policy and also

the budgets and forecasts.

Both the Group and Company deferred tax assets have been classified as long-term assets. The deferred tax assets which primarily relate to UK

losses do not expire and in assessing the recognition position of these losses, the Group expects to fully utilise the trade losses beyond the three-

year forecast period.

The Group has recognised deferred tax assets in jurisdictions where these are expected to be recoverable against profits in future periods, based

upon budgets and forecasts approved by the Board and on the basis of the Group having materially achieved its budgeted adjusted operating

profit for the financial year. Deferred tax assets and liabilities have been offset where the Group has a legally enforceable right to set off current

tax assets against current tax liabilities and where the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same

tax authority on the same taxable entity.

Deferred tax not recognised

No deferred tax liability is recognised on temporary differences of £559,000 (2024: £481,000) relating to the unremitted earnings of overseas

subsidiaries as the Group is able to control the timings of the reversal of these temporary differences and it is probable that they will not reverse

in the foreseeable future. A deferred tax asset of £1,129,000 (2024: £1,459,000) has not been recognised due to uncertainty that the asset will

be utilised in the foreseeable future. The deferred tax asset relates only to the Australian companies and is in respect of tax credits and loss

carry forwards.

Notes to the

continued

financial statements

160

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Annual report and financial statements 2025

11. Discontinued operations

On 24 November 2023, the Group announced its decision to close the RM Consortium business. By 30 November 2024, the RM Consortium

business had completely ceased operations, and the results of the business are therefore presented within discontinued operations.

Results of discontinued operations



	RM
	Consortium	Total
Year ended 30 November 2024	£000	£000
Revenue	996	996
Cost of sales	(1,212)	(1,212)
Gross loss	(216)	(216)
Operating expenses	(1,449)	(1,449)
Impairment write-backs	505	505
Loss before tax	(1,160)	(1,160)
Tax	290	290
Loss for the year from discontinued operations 1	(870)	(870)

Attributable to owners of the parent company.

Cash flows from discontinued operations



	Year ended	Year ended
	30 November 2025	30 November 2024
	£000	£000
Net cash used in operating activities	-	(419)
Net cash used in investing activities	-	-
Net cash used in financing activities	-	-
	-	(419)

12. Earnings per share

| | | |
| --- | --- | --- |
| | |
| | Year ended | Year ended |
| | 30 November 2025 | 30 November 2024 |
| | Number 000s | Number 000s |
| Weighted average number of shares in issue | 85,281 | 83,256 |
| Potentially dilutive shares (weighted average) | 1,092 | 213 |
| Diluted number of shares (weighted average) | 86,373 | 83,469 |



	Year ended 30 November 2025			Year ended 30 November 2024
	Adjusted	Adjustments	Total	Adjusted	Adjustments	Total
	£000	£000	£000	£000	£000	£000
Profit/(loss) for the year
Continuing operations	4,217	(2,023)	2,194	9,805	(13,672)	(3,867)
Discontinued operations	-	-	-	(1,249)	379	(870)
Total	4,217	(2,023)	2,194	8,556	(13,293)	(4,737)



	Adjusted	Total	Adjusted	Total
	Pence	Pence	Pence	Pence
Basic earnings per share
Continuing operations	4.9	2.6	11.8	(4.6)
Discontinued operations	-	-	(1.5)	(1.1)
Total	4.9	2.6	10.3	(5.7)
Diluted earnings per share
Continuing operations	4.9	2.5	11.7	(4.6)
Discontinued operations	-	-	(1.5)	(1.1)
Total	4.9	2.5	10.2	(5.7)

Potentially dilutive shares consist of shares that could be issued on exercise of outstanding share options (see Note 28).

Corporate governance

Financial statements

Overview

Strategic Report

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Annual report and financial statements 2025

161

13. Dividends

No dividends were paid in either the year ended 30 November 2025 or the year ended 30 November 2024. The Directors do not propose a

final dividend for the year ended 30 November 2025 (2024: £nil).

14. Goodwill

| | |
| --- | --- |
| | |
| Group | £000 |
| Cost | |
| At 1 December 2023 | 58,807 |
| Foreign exchange translation | (80) |
| At 30 November 2024 | 58,727 |
| Foreign currency translation | (136) |
| At 30 November 2025 | 58,591 |
| Accumulated impairment | |
| At 1 December 2023 | 20,269 |
| Impairment charge | 9,286 |
| At 30 November 2024 | 29,555 |
| At 30 November 2025 | 29,555 |
| Carrying amount | |
| At 30 November 2025 | 29,036 |
| At 30 November 2024 | 29,172 |

At 30 November 2025, the carrying amount of goodwill was allocated to two cash-generating units: RM TTS and RM Assessment as set

out in the table below.



	2025			2024
	Year ended 30	Pre-tax	Headroom/	Year ended 30	Pre-tax	Headroom/
	November	discount rate	(impairment)	November	discount rate	(impairment)
Group	£000	%	£000	£000	%	£000
RM TTS	22,347	14.2%	9,515	22,347	14.6%	(9,286)
RM Assessment	6,689	13.2%	87,486	6,825	14.5%	112,219

Further information pertaining to the performance and future strategy of the divisions can be found within the Strategic Report.

The recoverable amounts of the Cash Generating Units (CGU) are determined from value-in-use calculations. The key assumptions for the value-

in-use calculations are those regarding the cash flows, the discount rates and the growth rates. The Group has taken cash flow forecasts derived

from the most recent annual financial budget approved by the Board, which also contains forecasts for the two years following, and extrapolates

cash flows based on terminal rates which align to market growth and inflation expectations. There is estimation uncertainty regarding the impact

of climate change in the medium to long-term. Based on the analysis that has been undertaken to date, on pages 57 to 59

of this report, the

cash flow forecasts used for impairment calculations incorporate the medium to long-term impact of climate change.

The Group monitors its post-tax Weighted Average Cost of Capital and those of its competitors using market data. In considering the discount

rates applied to CGUs, the Directors have considered the relative sizes and risks of its CGUs and their relatively narrow operation within the

education products and services market. The impairment reviews use a discount rate adjusted for pre-tax cash flows. This discount rate was

reduced in the year ended 30 November 2025 by utilising a more comparable peer group of competitors that are division-specific.

Year ended 30 November 2025

The table below shows key assumptions used in the value-in-use calculations for the year ended 30 November 2025:



	RM TTS	RM Assessment
Pre-tax discount rate	14.2%	13.2%
Long-term growth rate	2.3%	1.8%

The assumptions underlying the cash flow forecasts used in the value-in-use calculations are consistent with those used in the going concern

base case scenario set out in Note 2.

Notes to the

continued

financial statements

continued

14. Goodwill

162

RM plc

Annual report and financial statements 2025

RM TTS

The cash flow forecasts have been risk adjusted, discounted for the first three years and extrapolated based on terminal rates that align to market

growth and inflation expectations.

The cash flows, long-term growth rates and pre-tax discount rates represent key sources of estimation uncertainty. The FY26 cash flow

assumption used in the impairment model is £5.1m, which includes an allocation of central costs of £4.1m.

An impairment would be recorded if the forecast cash flows reduced by £1.2m per year, the long-term growth rate reduced by 4.3%, or the pre-

tax discount rate increased by 3.2%.

If the cash flows in RM TTS were to reduce as set out within the reasonable worst-case scenario approved by the Board for inclusion in the going

concern review, no impairment would be required.

RM Assessment

The sensitivity of the RM Assessment carrying values to reasonably possible changes in key assumptions, including the reasonably possible

downside risks applied as part of the going concern review, has been performed and would not cause the carrying value to exceed its

recoverable amount. No reasonably possible change in the pre-tax discount rate or long-term growth rate would lead to an impairment and

accordingly these sensitivities have not been provided.

Year ended 30 November 2024

The table below shows key assumptions used in the value-in-use calculations for the year ended 30 November 2024:



		RM
	RM TTS	Assessment
Pre-tax discount rate	14.6%	14.5%
Long-term growth rate	2.2%	2.2%

RM TTS

The cash flow forecasts have been risk adjusted, discounted for the first three years and extrapolated based on terminal rates that align to

market growth and inflation expectations.

The cash flows, long-term growth rates and pre-tax discount rates represent key sources of estimation uncertainty. The FY25 cash flow

assumption used in the impairment model is £3.8m, which includes an allocation of central costs of £4.5m.

An additional £1.0m impairment would be recorded if the forecast cash flows reduced by £0.1m per year, the long-term growth rate fell to

1.8%, or the pre-tax discount rate increased to 15.0%.

If the cash flows in RM TTS were to reduce as set out within the reasonable worst-case scenario approved by the Board for inclusion in

the going concern review, then a further charge impairing the carrying value of the CGU of £38.2m would be required to be recorded.

The additional impairment charge in a mitigated reasonable worst-case scenario would be £33.3m. This would result in the write-off of

goodwill and a partial impairment of the other assets of the CGU.

The impairment in the prior period arose as a result of reductions in estimated future cash flows caused by increasing uncertainty in UK

and international schools budgets, together with economic movements driving higher discount rates and lower long-term growth rates.

RM Assessment

The sensitivity of the RM Assessment carrying values to reasonably possible changes in key assumptions, including the reasonably possible

downside risks applied as part of the going concern review, has been performed and would not cause the carrying value to exceed its

recoverable amount. No reasonably possible change in the pre-tax discount rate or long-term growth rate would lead to an impairment

and accordingly these sensitivities have not been provided.

Corporate governance

Financial statements

Overview

Strategic Report

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163

15. Other intangible assets

| | | | | | |
| --- | --- | --- | --- | --- | --- |
| | |
| | | | Intellectual | | |
| | | | property and | Other | |
| | Customer | | database | software | |
| | relationships | Brands | assets | assets | Total |
| | £000 | £000 | £000 | £000 | £000 |
| Cost | | | | | |
| At 1 December 2023 | 1,491 | 18,210 | 2,536 | 18,055 | 40,292 |
| Additions | - | - | - | 4,992 | 4,992 |
| Transfers from contract assets (Note 21) | - | - | - | 952 | 952 |
| Transfers to contract assets (Note 21) | - | - | - | (3,882) | (3,882) |
| Foreign currency translation | (13) | - | (52) | (1) | (66) |
| Disposals | (410) | (18,210) | - | (8,458) | (27,078) |
| At 30 November 2024 | 1,068 | - | 2,484 | 11,658 | 15,210 |
| Additions | - | - | - | 8,141 | 8,141 |
| Transfers to contract assets (Note 21) | - | - | - | (272) | (272) |
| Foreign currency translation | (37) | - | (87) | (17) | (141) |
| Disposals | - | - | - | (200) | (200) |
| At 30 November 2025 | 1,031 | - | 2,397 | 19,310 | 22,738 |
| Accumulated amortisation and impairment | | | | | |
| At 1 December 2023 | 1,350 | 18,210 | 1,129 | 14,379 | 35,068 |
| Charge for the year | 118 | - | 251 | 74 | 443 |
| Foreign currency translation | 10 | - | (52) | 1 | (41) |
| Disposals | (410) | (18,210) | - | (8,458) | (27,078) |
| At 30 November 2024 | 1,068 | - | 1,328 | 5,996 | 8,392 |
| Charge for the year | - | - | 237 | 158 | 395 |
| Foreign currency translation | (37) | - | (47) | (14) | (98) |
| Disposals | - | - | - | (200) | (200) |
| At 30 November 2025 | 1,031 | - | 1,518 | 5,940 | 8,489 |
| Carrying amount | | | | | |
| At 30 November 2025 | - | - | 879 | 13,370 | 14,249 |
| At 30 November 2024 | - | - | 1,156 | 5,662 | 6,818 |

All of the additions to other software assets in the year relate to internally generated intangibles. The total amortisation in year from

internally generated intangibles amounts to £0.1m (2024: £0.1m). Substantially all of the carrying value of other software assets relates to

the RM Ava platform (formerly the Global Accreditation Platform) which is under construction and therefore has not begun amortisation.

Following a review, no impairment of this balance has been required.

Notes to the

continued

financial statements

164

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Annual report and financial statements 2025

16. Property, plant and equipment

| | | | | | |
| --- | --- | --- | --- | --- | --- |
| | |
| | | Plant, | | | |
| | Short leasehold | equipment | Computer | | |
| | improvements | and fixtures | equipment | Vehicles | Total |
| Group | £000 | £000 | £000 | £000 | £000 |
| Cost | | | | | |
| At 1 December 2023 | 11,377 | 13,279 | 9,347 | 91 | 34,094 |
| Additions | 246 | 365 | 334 | - | 945 |
| Foreign currency translation | (8) | (9) | (26) | (1) | (44) |
| Disposals | - | (72) | (95) | (18) | (185) |
| At 30 November 2024 | 11,615 | 13,563 | 9,560 | 72 | 34,810 |
| Additions | - | 845 | 75 | - | 920 |
| Remeasurements | (42) | - | - | - | (42) |
| Foreign currency translation | (38) | (43) | (109) | (3) | (193) |
| Disposals | (2,829) | (2,947) | (5,324) | (38) | (11,138) |
| At 30 November 2025 | 8,706 | 11,418 | 4,202 | 31 | 24,357 |
| Accumulated depreciation | | | | | |
| At 1 December 2023 | 5,353 | 11,837 | 8,542 | 91 | 25,823 |
| Charge for the year | 663 | 649 | 393 | - | 1,705 |
| Impairment charge | 58 | 128 | - | - | 186 |
| Foreign currency translation | (8) | (9) | (22) | (1) | (40) |
| Disposals | - | (52) | (43) | (18) | (113) |
| At 30 November 2024 | 6,066 | 12,553 | 8,870 | 72 | 27,561 |
| Charge for the year | 583 | 623 | 329 | - | 1,535 |
| Foreign currency translation | (36) | (42) | (105) | (3) | (186) |
| Disposals | (2,829) | (2,947) | (5,324) | (38) | (11,138) |
| At 30 November 2025 | 3,784 | 10,187 | 3,770 | 31 | 17,772 |
| Carrying amount | | | | | |
| At 30 November 2025 | 4,922 | 1,231 | 432 | - | 6,585 |
| At 30 November 2024 | 5,549 | 1,010 | 690 | - | 7,249 |

Corporate governance

Financial statements

Overview

Strategic Report

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165

17. Right-of-use assets and leases

| | | | | |
| --- | --- | --- | --- | --- |
| | |
| | Land and | Plant and | | |
| | buildings | equipment | Vehicles | Total |
| Group | £000 | £000 | £000 | £000 |
| Cost | | | | |
| At 1 December 2023 | 21,429 | 2,062 | 151 | 23,642 |
| Remeasurements | 969 | 447 | - | 1,416 |
| Disposals | (2,151) | - | (117) | (2,268) |
| At 30 November 2024 | 20,247 | 2,509 | 34 | 22,790 |
| Additions | 18 | 1,627 | - | 1,645 |
| Remeasurements | 947 | 278 | - | 1,225 |
| Disposals | (480) | (1,326) | (9) | (1,815) |
| At 30 November 2025 | 20,732 | 3,088 | 25 | 23,845 |
| Accumulated depreciation and impairment | | | | |
| At 1 December 2023 | 8,024 | 1,198 | 145 | 9,367 |
| Charge for the year | 2,410 | 624 | 5 | 3,039 |
| Impairment charge | 638 | - | - | 638 |
| Disposals | (2,151) | - | (117) | (2,268) |
| At 30 November 2024 | 8,921 | 1,822 | 33 | 10,776 |
| Charge for the year

1 | 1,486 | 720 | 1 | 2,207 |
| Reversal of impairment charge | (81) | - | - | (81) |
| Disposals | (480) | (1,326) | (9) | (1,815) |
| At 30 November 2025 | 9,846 | 1,216 | 25 | 11,087 |
| Carrying amount | | | | |
| At 30 November 2025 | 10,886 | 1,872 | - | 12,758 |
| At 30 November 2024 | 11,326 | 687 | 1 | 12,014 |

Included within depreciation charge for the year is a credit of £109,000 relating to the shortening of a lease term and reduction in the lease liability. As the related right-

of-use asset was already fully depreciated, the required adjustment reverses previously recognised depreciation on the asset charged to cost of sales.

The most significant right-of-use asset is the Harrier Park warehouse which has a cost of £13.6m and a net book value at 30 November 2025

of £9.0m (2024: £10.0m). The warehouse is used by RM TTS.

The lease liabilities included on the Group balance sheet are:



	2025	2024
Group	£000	£000
Current	1,972	2,152
Non-current	13,393	12,816
	15,365	14,968

The Company has no leases.

The movements in the lease liability and the maturity analysis of lease liabilities are set out in Note 31 Financial risk management.

The expense relating to short-term and low-value leases is set out in Note 5 Profit/(loss) from operations.

Notes to the

continued

financial statements

166

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Annual report and financial statements 2025

18. Investments in subsidiary undertakings

The subsidiary undertakings of the Company at 30 November 2025 were:



		Country of
Name	Principal activity	incorporation	Class of share	% Held
RM Education Limited	Software, services & systems	England	Ordinary	100%
RM Educational Resources Limited	Resource supply	England	Ordinary	100%
R M T T S Trading LLC¹	Sales and marketing agent	United Arab Emirates	Ordinary	100%
RM Education Solutions India Private Limited¹	Software and corporate services	India	Ordinary	100%
RM Pension Scheme Trustee Limited	Corporate Trustee	England	Ordinary	100%
RM PLC Australia Pty Limited	Holding company	Australia	Ordinary	100%
SONET Systems Pty Limited¹	Software	Australia	Ordinary	100%
RM Education Research Machines Limited¹	Holding company	England	Ordinary	100%
RM Education Holdings Limited	Dormant	England	Ordinary	100%
TTS Group Limited	Dormant	England	Ordinary	100%

Held through subsidiary undertaking.

All UK subsidiary companies are registered at 142B Park Drive, Milton Park, Abingdon, Oxfordshire OX14 4SE.

R M T T S Trading LLC is registered at The One Tower, 23rd floor, Office 22, Sheikh Zayed Road, Dubai, United Arab Emirates.

RM Education Solutions India Private Limited is registered at 2nd Floor, Ganga Building, Technopark Phase III, Trivandrum, Kerala,

695583, India.

RM PLC Australia Pty Limited and SoNET Systems Pty Limited are registered at 179 Queen Street, Melbourne, Victoria, VIC 3000, Australia.

The investment in subsidiary undertakings comprises:



		Capital
		contribution
	Investment in	share-based
	share capital	payments	Total
Company	£000	£000	£000
Cost
At 1 December 2023	112,470	13,635	126,105
Share based payments	-	644	644
At 30 November 2024	112,470	14,279	126,749
Share based payments	-	1,005	1,005
At 30 November 2025	112,470	15,284	127,754
Accumulated impairment
At 1 December 2023	68,153	-	68,153
Impairment charge	1,911	1,288	3,199
At 30 November 2024	70,064	1,288	71,352
At 30 November 2025	70,064	1,288	71,352
Carrying value
At 30 November 2025	42,406	13,996	56,402
At 30 November 2024	42,406	12,991	55,397

Following an impairment review at 30 November 2024, the Company recognised a £3,199,000 impairment charge to fully write-off the

carrying value of its investment in RM Educational Resources Limited, comprising the RM TTS division and formerly the RM Consortium

division.

The remaining carrying value at 30 November 2025 and 2024 entirely relates to the Company’s investment in RM Education Limited

(comprising the RM Assessment and RM Technology divisions).

Corporate governance

Financial statements

Overview

Strategic Report

continued

18. Investments in subsidiary undertakings

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167

The recoverable amounts of the investments in subsidiary undertakings are determined from value-in-use calculations. The value in use

calculations include payments for pensions contributions and subsidiary loan repayments. The key assumptions for the value-in-use

calculations are those regarding the cash flows, the discount rates and the growth rates. The Group prepares cash flow forecasts derived

from the most recent annual financial budget approved by the Board, which also contains forecasts for the two years following, and

extrapolates cash flows based on internal forecasts with terminal rates which align to market growth and inflation expectations. For 2025,

the assumptions used to calculate the discount rates and long-term growth rates have been adjusted to better reflect current market

conditions. The discount rates and growth rates are the same as used in the goodwill impairment review as set out in Note 14.

For the Company’s investment in RM Educational Resources Limited, the value in use has been derived on the same basis as the TTS

CGU impairment review set out in Note 14. The impairment review is sensitive to a change in key assumptions used in the value in use

calculations relating to the discount rate and future growth rates.

The investment carrying value is sensitive to changes in forecast cash flows, and the assumed discount rate and future growth rate. A

£0.5m reversal of the impairment would be caused by a 0.1% reduction in the discount rate, or a 0.2% increase in the annual growth rate.

No reasonably possible change in assumptions would give rise to an impairment of the investment in RM Education Limited.

19. Inventories

| | | |
| --- | --- | --- |
| | |
| | 2025 | 2024 |
| Group | £000 | £000 |
| Finished goods | 12,987 | 15,190 |

Any inventory that is not expected to be turned over within 24 months has been provided for. Inventories are stated net of write-downs of

£323,000 (2024: £377,000).

20. Trade and other receivables

| | | | | |
| --- | --- | --- | --- | --- |
| | |
| | Group | | Company | |
| | 2025 | 2024 | 2025 | 2024 |
| | £000 | £000 | £000 | £000 |
| Current assets | | | | |
| Financial assets | | | | |
| Trade receivables | 13,481 | 12,045 | - | - |
| Other receivables | 744 | 766 | - | - |
| Derivative financial assets | - | 22 | - | - |
| Accrued income from customer contracts | 7,585 | 3,563 | - | - |
| | 21,810 | 16,396 | - | - |
| Non-financial assets | | | | |
| Prepayments | 4,240 | 5,327 | - | 111 |
| | 26,050 | 21,723 | - | 111 |
| Non-current assets | | | | |
| Financial assets | | | | |
| Other receivables | 353 | 245 | - | - |
| Total non-current assets | 353 | 245 | - | - |
| Total trade and other receivables | 26,403 | 21,968 | - | 111 |
| Currency profile of receivables | | | | |
| Pounds sterling | 20,372 | 18,279 | - | 111 |
| US dollar | 4,286 | 2,099 | - | - |
| Australian dollar | 54 | 150 | - | - |
| Euro | 101 | 34 | - | - |
| Indian rupee | 523 | 642 | - | - |
| Singapore dollar | 748 | 415 | - | - |
| Other | 319 | 349 | - | - |
| | 26,403 | 21,968 | - | 111 |

Notes to the

continued

financial statements

continued

20. Trade and other receivables

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The Directors consider that the carrying amounts of trade and other receivables approximates their fair values.

The Group’s accrued income from customer contracts balances solely relate to revenue from contracts with customers.

Movements in the accrued income balances were driven by transactions entered into by the Group within the normal course of business

in the year.

Analysis of trade receivables and customer contracts by type of customer


	2025	2024
Group	£000	£000
Government	8,701	8,188
Commercial	12,365	7,420
At 30 November	21,066	15,608

Trade receivables included an allowance for expected credit loss at 30 November 2025 of £338,000 (2024: £429,000), based on

management’s knowledge of the customer base, externally available information and expected payment likelihood. New customers are

subject to credit checks where available, using third-party databases, prior to being accepted. The Group applies the simplified approach

and records lifetime expected credit losses for trade receivables. Expected credit losses are measured using historical cash collection data

for periods of at least 12 months wherever possible and grouped into various customer segments based on product or customer type.

The historical loss rates are adjusted where macroeconomic factors (for example changes in interest rates or other commercial factors)

are expected to have a significant impact when determining future expected credit loss rates. The amounts presented in the balance

sheet are net of allowances for expected credit losses. The expected credit loss provision is calculated using a provision matrix, in which

the provision increases as balances age. Trade receivables and contract assets are written off when there is no reasonable expectation of

recovery and enforcement activity has ceased.

Allowance for estimated credit losses


	2025	2024
Group	£000	£000
At 1 December	429	1,424
Expected credit losses provided	16	147
Amounts written off in the year	(107)	(1,142)
At 30 November	338	429

No expected credit losses have been recognised on accrued income as the probability of default is considered insignificant.

Ageing of customer contract balances


	2025			2024
	Trade			Trade
	receivables	Allowance	Net	receivables	Allowance	Net
Group	£000	£000	£000	£000	£000	£000
Not past due	10,964	(29)	10,935	8,481	(74)	8,407
Overdue by less than 60 days	2,042	(1)	2,041	2,635	-	2,635
Overdue by between 60 and 90 days	359	(255)	104	628	(99)	529
Overdue by between 90 and 180 days	422	(21)	401	513	(187)	326
Overdue by more than 180 days	32	(32)	-	217	(69)	148
	13,819	(338)	13,481	12,474	(429)	12,045

The following table shows the movements in trade receivables in the year:


	2025	2024
Group	£000	£000
At 1 December	12,045	21,207
Amounts billed to customers in the period:
Net	155,767	167,509
Sales tax	22,778	25,562
Cash received	(177,200)	(203,228)
Movement in provision	(16)	(147)
Written off	107	1,142
At 30 November	13,481	12,045

Corporate governance

Financial statements

Overview

Strategic Report

continued

20. Trade and other receivables

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169

Impairment of intercompany receivables – Company accounts

At 30 November 2025, amounts owed by group undertakings amounted to £7,079,000 and were fully impaired (2024: £8,086,000 fully

impaired).

Movements in customer contract balances

The following table shows the movements in customer contract balances and the performance obligations satisfied in the year:



			Total customer	Contract
	Accrued	Deferred	contract	fulfilment
	income	income	balance	asset
Group	£000	£000	£000	£000
At 1 December 2023	2,860	(14,755)	(11,895)	3,908
Amounts subsequently billed to customers in the period	(2,631)	-	(2,631)	-
Performance obligations satisfied (invoiced and deferred in prior periods)	-	10,374	10,374	-
Revenue recognised but not invoiced in the period	3,334	-	3,334	-
Amounts billed to customers for which revenue will be recognised in later
periods	-	(11,491)	(11,491)	-
Transfer from other intangible assets	-	-	-	3,882
Transfer to other intangible assets	-	-	-	(952)
New contract fulfilment costs incurred	-	-	-	4,394
New contract fulfilment assets amortised in line with performance
obligations satisfied	-	-	-	(2,470)
Written off	-	45	45	-
Impact of foreign exchange	-	15	15	(192)
At 30 November 2024	3,563	(15,812)	(12,249)	8,570
Amounts subsequently billed to customers in the period	(3,098)	-	(3,098)	-
Performance obligations satisfied (invoiced and deferred in prior periods)	-	15,379	15,379	-
Revenue recognised but not invoiced in the period	7,118	-	7,118	-
Amounts billed to customers for which revenue will be recognised in later
periods	-	(9,086)	(9,086)	-
Transfer from other intangible assets	-	-	-	272
Transfer from prepayments	-	-	-	859
New contract fulfilment costs incurred	-	-	-	4,811
New contract fulfilment assets amortised in line with performance
obligations satisfied	-	-	-	(6,516)
Impact of foreign exchange	2	15	17	(14)
At 30 November 2025	7,585	(9,504)	(1,919)	7,982

Revenue recognised in the year from performance obligations satisfied in previous periods was £nil (2024: £nil).

Customer contract invoices are raised on the following basis:

•

For point-in-time revenue streams – invoicing raised on delivery of performance obligations;

•

For over-time revenue streams in RM Technology – the majority of contract invoicing is either in advance (monthly, quarterly, or

annually) or quarterly in arrears; and

•

For over-time revenue streams in RM Assessment – invoicing varies contract to contract and between performance obligations and can

be materially different to the satisfaction of the related performance obligations in timing.

Notes to the

continued

financial statements

170

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Annual report and financial statements 2025

21. Contract fulfilment assets

| | | | |
| --- | --- | --- | --- |
| | |
| | | 2025 | 2024 |
| Group | Note | £000 | £000 |
| At 1 December | | 8,570 | 3,908 |
| Additions | | 4,811 | 4,394 |
| Transfer from intangible assets | 15 | 272 | 3,882 |
| Transfer to intangible assets | 15 | - | (952) |
| Transfer from prepayments | | 859 | - |
| Amortised in the period | | (6,516) | (2,470) |
| Foreign exchange | | (14) | (192) |
| At 30 November | | 7,982 | 8,570 |
| Analysed by | | | |
| Current | | 2,720 | 2,909 |
| Non-current | | 5,262 | 5,661 |
| At 30 November | | 7,982 | 8,570 |

Contract fulfilment assets represent investment in contracts which are recoverable and are expected to provide benefits over the life of the

contract.

22. Trade and other payables

| | | | | |
| --- | --- | --- | --- | --- |
| | |
| | Group | | Company | |
| | 2025 | 2024 | 2025 | 2024 |
| | £000 | £000 | £000 | £000 |
| Current liabilities | | | | |
| Financial liabilities | | | | |
| Trade payables | 17,672 | 13,748 | - | - |
| Lease liabilities | 1,972 | 2,152 | - | - |
| Other payables | 3,894 | 3,224 | - | - |
| Derivative financial liabilities | 40 | - | - | - |
| Accruals | 6,302 | 7,340 | 136 | 109 |
| Amounts owed to Group undertakings | - | - | 32,550 | 38,260 |
| | 29,880 | 26,464 | 32,686 | 38,369 |
| Non-financial liabilities | | | | |
| Other taxation and social security | 2,676 | 3,206 | - | - |
| Deferred income from customer contracts | 9,339 | 12,227 | - | - |
| | 41,895 | 41,897 | 32,686 | 38,369 |
| Non-current liabilities | | | | |
| Financial liabilities | | | | |
| Lease liabilities | | | | |
| – due after one year but within two years | 1,964 | 1,676 | - | - |
| – due after two years but within five years | 5,108 | 3,849 | - | - |
| – after five years | 6,321 | 7,291 | - | - |
| | 13,393 | 12,816 | - | - |
| Non-financial liabilities | | | | |
| Deferred income from customer contracts | | | | |
| – due after one year but within two years | 141 | 1,447 | - | - |
| – due after two years but within five years | 24 | 2,138 | - | - |
| | 13,558 | 16,401 | - | - |
| | 55,453 | 58,298 | 32,686 | 38,369 |

Corporate governance

Financial statements

Overview

Strategic Report

continued

22. Trade and other payables

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171

The amounts owed to Group undertakings by the Company are unsecured, payable on demand and bear interest at SONIA plus 2%. Other

payables mainly comprise overpayments and rebates due to customers. The Group’s deferred revenue balances solely relate to revenue

from contracts with customers. Movements in the deferred revenue balances were driven by transactions entered into by the Group within

the normal course of business in the year.

Currency profile of trade and other payables



	Group		Company
	2025	2024	2025	2024
	£000	£000	£000	£000
Pounds sterling	49,323	47,525	32,686	38,369
US dollar	1,048	5,254	-	-
Australian dollar	351	775	-	-
Indian rupee	1,649	2,134	-	-
Other	3,082	2,610	-	-
	55,453	58,298	32,686	38,369

23. Provisions

| | | | | |
| --- | --- | --- | --- | --- |
| | |
| | | Employee- | | |
| | | related | Contract risk | |
| | Dilapidations | restructuring | provisions | Total |
| Group | £000 | £000 | £000 | £000 |
| At 1 December 2023 | 2,292 | 816 | 1,634 | 4,742 |
| Increase in provisions | 876 | 81 | - | 957 |
| Utilisation of provisions | (287) | (740) | (885) | (1,912) |
| Release of provisions | (323) | (76) | (251) | (650) |
| Unwinding of discount on provisions | 78 | - | - | 78 |
| At 30 November 2024 | 2,636 | 81 | 498 | 3,215 |
| Increase in provisions | 65 | 50 | 15 | 130 |
| Utilisation of provisions | (436) | (101) | (370) | (907) |
| Remeasurement of provisions | (63) | - | - | (63) |
| Release of provisions | (424) | - | (46) | (470) |
| Unwinding of discount on provisions (see Note 9) | 58 | - | - | 58 |
| At 30 November 2025 | 1,836 | 30 | 97 | 1,963 |

Dilapidations provisions are based on reports from appropriately qualified third-party experts. Of the £1.8m total dilapidations provisions at

30 November 2025, £1.0m is expected to be utilised in 2026 and the remaining £0.8m between 2027 and 2035.

Employee-related restructuring provisions refer to costs arising from restructuring to meet the future needs of the Group. All these

restructuring activities are expected to be completed during 2026.

Contract risk provisions include items not covered by any other category of which the majority relates to provisions for onerous IT licence

contracts, which decreased as provisions recognised following the Group’s decision to cease trading in the RM Consortium business were

utilised.

Disclosure of provisions



	2025	2024
Group	£000	£000
Current liabilities	1,154	1,972
Non-current liabilities	809	1,243
	1,963	3,215

Notes to the

continued

financial statements

172

RM plc

Annual report and financial statements 2025

24. Pension schemes

a. Defined contribution schemes

The Group operates or contributes to a number of defined contribution schemes for the benefit of qualifying employees. The assets

of these schemes are held separately from those of the Company. The total cost charged to income of £2,243,000 (2024: £2,041,000)

represents contributions payable to these schemes by the Group at rates specified in employment contracts.

b. Defined benefit pension schemes

As described in Note 2, the Group has both defined benefit and defined contribution pension schemes. There are four defined benefit

pension schemes.

The Research Machines plc 1988 Pension Scheme (RM Scheme)

The Scheme provides benefits to qualifying employees and former employees of RM Education Limited but was closed to new members

with effect from 1 January 2003 and closed to future accrual of benefits from 31 October 2012. The assets of the Scheme are held

separately from RM Education Limited’s assets in a trustee-administered fund. The Trustee is an external company. The Scheme is a funded

scheme.

Under the Scheme, employees were entitled to retirement benefits of 1/60th of final salary for each qualifying year on attainment of

retirement age of 60 or 65 years and additional benefits based on the value of individual accounts. No other post-retirement benefits were

provided by the Scheme.

The most recent actuarial valuation of Scheme assets and the present value of the defined benefit obligation was carried out for statutory

funding purposes at 31 May 2024 by a qualified independent actuary. IAS 19 Employee Benefits (revised) liabilities at 30 November 2025

have been rolled forward based on this valuation’s base data.

As at 31 May 2024, the triennial valuation for statutory funding purposes showed a surplus of £10,393,000. No additional contribution

payments are required.

The Company has entered into a pension protection fund compliant guarantee in respect of Scheme liabilities. No liability has been

recognised for this within the Company as the Directors consider that the likelihood of it being called upon is remote.

The Consortium CARE Scheme (CARE Scheme)

Until 31 December 2005, The Consortium for Purchasing and Distribution Limited (The Consortium, acquired by the Company on

30 June 2017 and subsequently became a part of RM Educational Resources Limited) operated a pension scheme (the Consortium CARE

scheme) providing benefits on both a defined benefit (final salary-linked) and a defined contribution basis. From 1 January 2006, the

defined benefit (final salary-linked) and defined contribution sections were closed and all employees, subject to the eligibility conditions

set out in the Trust Deed and Rules, joined a new defined benefit (Career Average Revalued Earnings) section. From 28 February 2011 the

Scheme was closed to future accruals.

The Consortium division became a discontinued operation during the year ended 30 November 2024. Costs relating to administration of

the Scheme subsequent to this date are disclosed as an adjusting item (see Note 6).

The most recent actuarial valuation of Scheme assets and the present value of the defined benefit obligation was carried out for statutory

funding purposes at 31 May 2024 by a qualified independent actuary. IAS 19 Employee Benefits (revised) liabilities at 30 November 2025

have been rolled forward based on this valuation’s base data.

As at 31 May 2024, the triennial valuation for statutory funding purposes showed a surplus of £112,000. No further deficit catch-

up payments, beyond those agreed in the prior valuation (dated 31 May 2021) of £1,200,000 per annum until 31 December 2026,

were required. Subsequent to agreeing the 31 May 2024 triennial valuation, the Company and trustee of the CARE Scheme signed a

memorandum of understanding that ceased contributions to the scheme with effect from 1 June 2025, but with the requirement to

reinstate (at the level of £50,000 per month) should the funding level fall below a specified threshold, as measured at each actuarial report

anniversary.

Prudential Platinum Pension (Platinum Scheme)

The Consortium acquired West Mercia Supplies in April 2012 (prior to the Company acquiring The Consortium). Upon acquisition by The

Consortium of West Mercia Supplies, a pension scheme (the Platinum scheme) was set up providing benefits on both a defined benefit

(final salary-linked) and a defined contribution basis for West Mercia employees. The most recent full actuarial valuation was carried out by

the independent actuaries on 31 December 2024. The Scheme is administered within a legally separate trust from The Consortium and

the Trustees are responsible for ensuring that the correct benefits are paid, that the Scheme is appropriately funded and that the Scheme

assets are appropriately invested. The triennial valuation of the Scheme for statutory funding purposes at 31 December 2024 was a surplus

of £391,300. No contribution payments are required until 31 December 2030.

Local Government Pension Schemes

The Group has TUPE employees who retain membership of Local Government Pension Schemes. The Group is required to pay regular

contributions as decided by the relevant Scheme actuary and as detailed in each Scheme’s schedule of contributions, which are calculated

every three years as part of a triennial valuation. Many of these Schemes have a customer contractual guarantee whereby the Group

reimburses any deficit when it ceases to be a participating employer.

Corporate governance

Financial statements

Overview

Strategic Report

continued

24. Pension schemes

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173

The Group is not the main sponsoring employer in these local government pension schemes and therefore does not have an

unconditional right to recover surpluses, either during the life of the Scheme, when all the members have left the plan, or on a plan wind-

up. Similarly, the Group is not liable for other entities’ obligations in these Schemes.

The Group makes payments to these Schemes for current service costs in accordance with its contractual obligations. The amount due in

respect of these schemes at 30 November 2025 was £80,522 (2024: £50,000).

Amounts recognised in the income statement and in the statement of comprehensive income


		Year ended	Year ended
		30 November	30 November
		2025	2024
Group	Note	£000	£000
Past service cost (see Note 6)		-	(300)
Administrative expenses		(409)	(27)
Operating expense		(409)	(327)
Interest cost		(8,876)	(8,763)
Interest on scheme assets		9,954	9,510
Net interest income	8	1,078	747
Income recognised in the income statement		669	420
Effect of changes in demographic assumptions		(366)	354
Effect of changes in financial assumptions		13,134	(73)
Effect of experience adjustments		(2,419)	1,673
Total actuarial gains		10,349	1,954
Return on scheme assets excluding interest on scheme assets		(12,778)	1,439
Reversal of historical payment accrual		-	367
(Expense)/income recognised in the statement of comprehensive income		(2,429)	3,760

Notes to the

continued

financial statements

continued

24. Pension schemes

174

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Annual report and financial statements 2025

Reconciliation of the scheme assets and obligations through the year


				Local
				Government
	RM	CARE	Platinum	Pension
	Scheme	Scheme 1	Scheme	Schemes	Total
	£000	£000	£000	£000	£000
Assets:
At 1 December 2023	170,546	12,665	1,874	-	185,085
Interest on scheme assets	8,748	666	96	-	9,510
Return on scheme assets, excluding interest on
scheme assets	1,064	391	(16)	-	1,439
Administrative expenses	-	-	(27)	-	(27)
Contributions from Group	3,027	1,215	28	-	4,270
Benefits paid	(4,405)	(657)	(18)	-	(5,080)
At 30 November 2024	178,980	14,280	1,937	-	195,197
Interest on scheme assets	9,131	724	99	-	9,954
Return on scheme assets, excluding interest on
scheme assets	(11,841)	(813)	(124)	-	(12,778)
Administrative expenses	(298)	(80)	(31)	-	(409)
Contributions from Group	707	619	29	-	1,355
Benefits paid	(4,913)	(715)	(19)	-	(5,647)
At 30 November 2025	171,766	14,015	1,891	-	187,672
Obligations:
At 1 December 2023	(158,387)	(13,046)	(1,237)	(30)	(172,700)
Past service cost	(300)	-	-	-	(300)
Interest cost	(8,045)	(655)	(63)	-	(8,763)
Actuarial gains/(losses)	2,064	(129)	19	-	1,954
Benefits paid	4,405	657	18	-	5,080
At 30 November 2024	(160,263)	(13,173)	(1,263)	(30)	(174,729)
Interest cost	(8,157)	(654)	(65)	-	(8,876)
Actuarial gains	9,490	685	174	-	10,349
Benefits paid	4,913	715	19	-	5,647
At 30 November 2025	(154,017)	(12,427)	(1,135)	(30)	(167,609)
Net pension surplus/(deficit)
At 30 November 2025
Pension deficit	-	-	-	(30)	(30)
Pension surplus	17,749	1,588	756	-	20,093
Net pension surplus/(deficit)	17,749	1,588	756	(30)	20,063
At 30 November 2024
Pension deficit	-	-	-	(30)	(30)
Pension surplus	18,717	1,107	674	-	20,498
Net pension surplus/(deficit)	18,717	1,107	674	(30)	20,468

Included within the CARE Scheme obligations at 30 November 2025 is an unfunded liability of £72,000 (2024: £85,000) which is a liability of the Group and not the

Scheme.

Surplus recognition

The RM, CARE and Platinum Schemes are in an accounting surplus position. In each case, any surplus remaining after all members have

left the Scheme would be returned to the Group in accordance with the trust deed. The full economic benefit of any surplus is therefore

available to the Group and is recognised on the balance sheet.

Corporate governance

Financial statements

Overview

Strategic Report

continued

24. Pension schemes

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Reconciliation of net defined benefit obligation


	Year ended	Year ended
	30 November	30 November
	2025	2024
Group	£000	£000
Net pension surplus at 1 December	20,468	12,385
Past service cost	-	(300)
Net interest income included in the income statement	1,078	747
Administrative expenses included in the income statement	(409)	(27)
Scheme remeasurements included in the statement of comprehensive income 1	(2,429)	3,393
Cash contribution	1,355	4,270
Net pension surplus at 30 November	20,063	20,468

The prior year figure of £3,393,000 excludes a historical adjustment of £367,000.

Obligation by participant status


	At	At
	30 November	30 November
	2025	2024
Group	£000	£000
Vested deferreds	120,511	124,879
Retirees	47,068	49,820
Local Government Pension Schemes obligations	30	30
	167,609	174,729

Value of scheme assets


		At	At
		30 November	30 November
		2025	2024
Group	Fair value hierarchy	£000	£000
Cash and cash equivalents, including escrow	Level 1	1,882	1,408
Equity instruments	Level 2	42,136	68,206
Equity instruments - pooled investment vehicle	Level 3	1,342	2,132
Debt instruments	Level 2	1,891	2,019
Liability driven investments	Level 2	124,198	104,415
Insurance contract	Level 3	16,223	17,017
		187,672	195,197

Liability driven investments (LDI)

The RM Scheme and the CARE Scheme assets include an LDI portfolio. The portfolio is valued at market value as no bid valuation is

available. The components of the LDI portfolio are determined by the Trustee’s investment advisor with the aim to provide a good match

to the Scheme’s exposure to interest rate and inflation risks within the value of its liabilities.

Liability driven investments are expected to move broadly in line with the rise and fall in liability values, thus providing a degree of

protection to the Scheme’s funding position.

Insurance assets

The RM Scheme also holds insurance policies covering benefits for some pensions in payment. The value of these annuities is £16.2m

at 30 November 2025 (2024: £17.0m). This value has been calculated using the same assumptions as used to value the liabilities. The

method of determining the value of the insurance annuities is determined by projecting the expected benefit payments using the agreed

assumptions and then discounting the resulting cash flows back to 30 November 2025.

Notes to the

continued

financial statements

continued

24. Pension schemes

176

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Annual report and financial statements 2025

Significant actuarial assumptions


	Year ended	Year ended
Group	30 November 2025	30 November 2024
Discount rate (RM Scheme)	5.55%	5.15%
Discount rate (CARE Scheme)	5.45%	5.10%
Discount rate (Platinum Scheme)	5.60%	5.15%
Rate of RPI price inflation (RM Scheme)	2.85%	3.10%
Rate of RPI price inflation (CARE Scheme)	2.85%	3.15%
Rate of RPI price inflation (Platinum Scheme)	2.85%	3.05%
Rate of CPI price inflation - period before 1 January 2030	2.05%	2.20%
Rate of CPI price inflation - period after 1 January 2030	2.90%	3.10%
Rate of pensions increases based on RPI with 5% cap (RM Scheme)	2.75%	2.90%
Rate of pensions increases based on RPI with 5% cap (CARE Scheme)	2.75%	2.95%
Rate of pensions increases based on RPI with 2.5% cap	1.90%	1.95%
Mortality base table (RM and CARE schemes)	S4PA	S4PA
Mortality base table (Platinum scheme)	S3PA	S3PA
Future longevity improvements	CMI 2024 with 1.00% long-	CMI 2023 with 1.00% long-
	term improvement, COVID	term improvement, 2020 and
	half-life parameter of 0.5 1	2021 weight parameters of
		0%, 2022 and 2023 of 100%
Weighted average duration of defined benefit obligation	16 years	16 years
Assumed life expectancy on retirement at age 65 for the RM scheme:
Retiring at the accounting date (male member aged 65)	21.1	20.7
Retiring 20 years after the accounting date (male member aged 45)	22.0	21.6

The half-life parameter (‘H’) is a new addition for the CMI 2024 mortality improvements model. This parameter controls the rate of decay of the newly introduced

‘overlay’. The overlay covers the mortality experience shock from the COVID-19 pandemic, specifically how much of it remains versus the initial 2020 shock. The

longer the half-life, the slower the overlay reduces and therefore the longer the effects of the pandemic are assumed to persist. The defined benefit obligation has been

calculated using a half-life parameter of 0.5, which means that the overlay halves every 0.5 years and is largely removed by 2024. Due to the way the mortality rates have

fallen in the last few years, a shorter half-life currently results in higher projected long-term mortality and therefore lower life expectancies.

Expected cash flows


	Year ended	Year ended
Group	30 November 2025	30 November 2024
Expected employer contributions for the following year ended
30 November	-	1,907
Expected total benefit payments
Year 1	5,788	5,208
Year 2	5,953	5,359
Year 3	6,122	5,514
Year 4	6,297	5,674
Year 5	6,476	5,839
Years 6 - 10	35,256	31,835

The Group has agreed with the Trustee of the RM and CARE Schemes to provide the Schemes with a second ranking fixed and floating

charge over the shares of all obligor companies (except for RM plc) and a payment of £0.5m each at bi-annual intervals starting on August

2023 which is contingent upon the adjusted debt leverage ratio being less than 3.2x at that date. The definition of adjusted leverage

is aligned to the banking facility as set out in Note 25. No such payments were made during the years ended 30 November 2025 or

30 November 2024, because the Group remained above the threshold for the adjusted debt leverage ratio.

Corporate governance

Financial statements

Overview

Strategic Report

continued

24. Pension schemes

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Key risks

The schemes expose the Group to a number of risks:

•

Investment risk: The scheme holds investments in asset classes, such as equities, which have volatile market values and, while these

assets are expected to provide real returns over the long-term, the short-term volatility can cause additional funding to be required if a

deficit emerges.

•

Interest rate risk: The scheme’s liabilities are assessed using market yields on high quality corporate bonds to discount the liabilities.

As the scheme holds assets such as equities and diversified growth funds the value of the assets and liabilities may not move in the

same way.

•

Inflation risk: A significant proportion of the benefits under the scheme are linked to inflation. Although the scheme’s assets are expected

to provide a good hedge against inflation over the long-term, movements over the short-term could lead to deficits emerging.

•

Mortality risk: In the event that members live longer than assumed a deficit will emerge in the scheme.

Sensitivities to assumptions – one item changed with all others held constant

The significant actuarial assumptions are the discount rate applied to pension liabilities, the inflation rate and mortality. The table below

shows the sensitivity of the scheme obligations and net surplus to a COVID half-life parameter of 1.0, 0.1% movement in discount rate, a

0.1% movement in RPI and a one-year increase in life expectancy.



	At 30 November 2025
		COVID
		half-life	Discount rate	Discount rate	RPI	RPI	Life
	Base	parameter	-0.1%	+0.1%	-0.1%	+0.1%	+1year
Group	£m	1.0	£m	£m	£m	£m	£m
Analysis of net balance sheet
position
Fair value of scheme assets	187.7	187.7	187.7	187.7	187.7	187.7	187.7
Present value of scheme
obligations	(167.6)	(168.1)	(169.9)	(165.3)	(165.9)	(169.3)	(171.2)
Net pension surplus	20.1	19.6	17.8	22.4	21.8	18.4	16.5
Actuarial assumptions
COVID half-life parameter	0.5	1.0	0.5	0.5	0.5	0.5	0.5
Discount rate (RM Scheme)	5.55%	5.55%	5.45%	5.65%	5.55%	5.55%	5.55%
Discount rate (CARE Scheme)	5.45%	5.45%	5.35%	5.55%	5.45%	5.45%	5.45%
Discount rate (Platinum Scheme)	5.60%	5.60%	5.50%	5.70%	5.60%	5.60%	5.60%
Rate of RPI	2.85%	2.85%	2.85%	2.85%	2.75%	2.95%	2.85%
Rate of CPI	2.05%	2.05%	2.05%	2.05%	1.95%	2.15%	2.05%

Implications of Court of Appeal ruling of Virgin Media Ltd versus NTL Pension Trustees II Ltd case

On 16 June 2023, the High Court handed down its decision in the Virgin Media Ltd versus NTL Pension Trustees II Ltd case, which

concerned the correct interpretation of section 37 of the Pension Schemes Act 1993. Subsequently Virgin Media Ltd filed an appeal, the

hearing for which took place on 26 and 27 June 2024 and on 25 July 2024, it was announced that the Court of Appeal upheld the High

Court ruling. The Court of Appeal’s ruling confirms that a section 37 confirmation was required where an alteration to a scheme’s rules

affected pension benefits attributable to past or future service benefits related to section 9(2B) rights between 6 April 1997 until the end of

contracting-out on 5 April 2016.

For the RM and CARE schemes the trustees undertook an initial review of amendments to the schemes within the relevant time period.

This identified a number of amendments which required section 37 confirmations. On 1 September 2025 the UK government published

amendments to the Pension Schemes Bill which allow trustees to request scheme actuaries to provide retrospective validation of any

historic alternations where certification was not originally requested, or evidence of this cannot be located. The final position will only be

certain once the Pension Schemes Bill is finalised and any associated guidance for scheme actuaries is published. Accordingly, at this stage

there remains no quantification of the potential impact, if any, on the schemes and hence no provision has been made in the Financial

Statements.

In respect of the Platinum Pension Scheme, as the Company has one small sub-section of a much larger scheme, with fewer than 50

members in the sub-section, the risk of implications from the ruling are deemed immaterial.

Notes to the

continued

financial statements

178

RM plc

Annual report and financial statements 2025

25. Borrowings

| | | |
| --- | --- | --- |
| | |
| | 2025 | 2024 |
| Group and Company | £000 | £000 |
| Bank loan | 58,000 | 57,000 |
| Less capitalised fees | (1,258) | (1,476) |
| Borrowings | 56,742 | 55,524 |

The borrowings in the year and details of the facility are detailed in Note 31.

At 30 November 2025, the Group had drawn down £58.0m (2024: £57.0m) of the facility.

Bank and professional service fees relating to securing the loan have been capitalised and are amortised over the length of the loan of

which £738,000 (2024: £1,476,000) relates to the unamortised previous facility agreements and £520,000 is the unamortised arrangement

fee relating to the extension during the current year.

During the year the Group secured an agreement with Lenders which extended its existing £70.0m facility to July 2027. The fixed charge

over the shares of each of the obligor companies (except for RM plc), and the fixed and floating charge over all assets of the obligor

companies granted previously to Lenders remain in place. Under the amended facility covenants have been reset as follows:

•

A quarterly LTM (last twelve months) EBITDA covenant test to November 2026, which is then replaced by a quarterly EBITDA leverage

test and interest cover, which are required to be below 4.5x and above 4x respectively from February 2027; and

•

A hard liquidity covenant test requiring the Group to have liquidity greater than £7.5m on the last business day of the month, and liquidity

not be below £7.5m at the end of two consecutive weeks within a month. This liquidity limit is the minimum amount the Group must

have available under the facility, taking into account cash and the amount left to draw.

The Group operated within its existing financial covenants during 2025. At the end of November 2025, the minimum EBITDA covenant

required was £9.7m versus EBITDA of £15.5m. During 2025, the Group remained over the soft liquidity covenant limit which requires

liquidity to be greater than £12.5m during the cash flow forecast period. No further meetings were however requested by the lenders.

26. Share capital and share premium

| | | | |
| --- | --- | --- | --- |
| | |
| | Ordinary shares of par value

2

2

/

7

p | | |
| | | | Share |
| | | Share capital | premium |
| Group and Company | Number 000 | £000 | £000 |
| Authorised, allotted, called up and fully paid: | | | |
| At 1 December 2023 and 30 November 202

4 | 83,875 | 1,917 | 27,080 |
| Issued in the year | 14,211 | 325 | 12,378 |
| At 30 November 2025 | 98,086 | 2,242 | 39,458 |

Ordinary shareholders are entitled to one vote per share at the general meetings of the Company and carry no right to fixed income.

On 14 October 2025, the Company issued 14,210,527 ordinary shares at a price of £0.95 per share, for total gross proceeds of £13,500,001.

The share premium recognised is net of directly attributable share issue costs.

27. Own shares

The RM plc Employee Share Trust (EST) was established in March 2003 to hedge the future obligations of the Group in respect of

shares awarded under the RM plc Co-Investment Plan, RM plc Performance Share Plan and Deferred Bonus Plan. The EST has waived

any entitlement to the receipt of normal dividends in respect of all of its holding of the Company’s ordinary shares. The EST’s waiver of

dividends may be revoked or varied at any time.



	Ordinary shares of 2 2 / 7 p
Group and Company	Number 000	£000
At 1 December 2023, 30 November 2024 and 30 November 2025	619	444

The valuation of the shares is weighted average cost.

The maximum number of own shares held in the year was 618,796 (2024: 618,796).

Corporate governance

Financial statements

Overview

Strategic Report

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Annual report and financial statements 2025

179

28. Share-based payments

The Group operates an equity-settled share-based payment scheme known as the RM plc Performance Share Plan 2019 (the PSP Scheme)

for the remuneration of senior employees. Details of Directors’ awards are contained within the Remuneration Report.

Participants are granted nil-cost options which are subject to performance conditions and remaining employed up to the vesting date.

The performance conditions are measured over a three-year performance period and are based on a mix of total shareholder return and

total shareholder return relative to a comparator group of FTSE Small Cap Index companies. For all options granted since January 2023,

the performance conditions have been based on 60% total shareholder return and 40% relative return, and the metrics applied will vary

depending on the grant date.

During the year ended 30 November 2025, one award was made under the PSP Scheme (2024: three awards). The total share-based

payments charge was:



	Year ended	Year ended
	30 November 2025	30 November 2024
	£000	£000
Equity-settled share-based payment charge	1,005	644

The movements in the number of share options are:



	Year ended	Year ended
	30 November 2025	30 November 2024
	Number	Number
Outstanding at the start of the year	5,442,788	2,467,388
Granted during the year	1,940,802	3,285,777
Forfeited during the year	(809,840)	(310,377)
Outstanding at the end of the year	6,573,750	5,442,788
Exercisable at the end of the year	Nil	Nil
Weighted average remaining contractual life	8.4 years	8.9 years
Weighted average fair value of options granted	£0.57	£0.47

All awards are in the form of nil cost options and so have an exercise price of £nil (2024: £nil).

The options granted in the year ended 30 November 2025 are valued using a Monte-Carlo model. The expected TSR volatilities are based

on the historical daily TSR over a period commensurate with the remaining performance period. For further information on the TSR metric

input included in the share-based payment fair value calculation for grants in the year, please refer to footnote 3 within the Long-term

Incentive Plans awards during FY25 section of the Remuneration Committee Report on page 106. The principal assumptions used in these

valuations were:



	Year ended	Year ended
	30 November 2025	30 November 2024
Range of share price at date of grant	£1.13	£0.54 to £0.86
Volatility	76%	74% to 76%
Risk-free rate	4.0%	4.1% to 4.2%
Dividend yield	Nil	Nil

29. Guarantees and contingent liabilities

a) Guarantees

The Company has entered into guarantees relating to the performance and liabilities of certain major contracts of its subsidiaries. In

addition, as set out in Note 24, some of the local government pension schemes have a customer contractual guarantee whereby the

Group reimburses the schemes for any deficit when the Group ceases to be a participating employer. The Directors are not aware of any

circumstances that have given rise to any liability under such guarantees and consider the possibility of any arising to be remote.

The Group has provided first ranking security to the bank facility lenders (see Note 31) and provided second ranking security to the

Research Machines 1988 Defined Benefit Pension Scheme and the CARE Pension Scheme (see Note 24).

b) Contingent liabilities

The Group has provided performance guarantees and indemnities relating to performance bonds and letters of credit issued by its banks

on its behalf, in the ordinary course of business. The Directors are not aware of any circumstances that have given rise to any liability under

such guarantees and indemnities and consider the possibility of any arising to be remote.

Notes to the

continued

financial statements

180

RM plc

Annual report and financial statements 2025

30. Capital commitments

At 30 November 2025, capital expenditure contracted for but not recognised as a liability amounted to £nil (2024: £nil).

31. Financial risk management

| | | | | |
| --- | --- | --- | --- | --- |
| | |
| | Group | | Company | |
| | 2025 | 2024 | 2025 | 2024 |
| | £000 | £000 | £000 | £000 |
| Financial assets | | | | |
| Trade and other receivables - current | 21,810 | 16,396 | - | - |
| Trade and other receivables - non-current | 353 | 245 | - | - |
| Cash and short-term deposits | 6,166 | 8,196 | - | - |
| | 28,329 | 24,837 | - | - |
| Financial liabilities | | | | |
| Trade and other payables - current | (29,880) | (26,464) | (32,686) | (38,369) |
| Trade and other payables - non-current | (13,393) | (12,816) | - | - |
| Bank overdrafts | - | (4,325) | - | - |
| Bank loans | (56,742) | (55,524) | (56,742) | (55,524) |
| | (100,015) | (99,129) | (89,428) | (93,893) |

All assets and liabilities classified as financial assets and financial liabilities are held at amortised cost except for forward foreign exchange

contracts of £40,000 liability (2024: £22,000 asset) which are measured at fair value.

The Directors consider that the carrying amount of all financial assets and financial liabilities approximates their fair value.

It is, and has been throughout the period under review, the Group’s policy that no trading in financial instruments shall be undertaken,

and the Group does not hold or issue derivative financial instruments for speculative purposes. The main risks arising from the Company’s

financial assets and liabilities are market risk (foreign currency risk and interest rate risk), credit risk and liquidity risk. The Board reviews and

agrees policies on a regular basis for managing the risks associated with these assets and liabilities.

Changes in liabilities arising from financing activities



	2025		2024
	Borrowings	Lease liabilities	Borrowings	Lease liabilities
	£000	£000	£000	£000
At 1 December	55,524	14,968	53,651	16,491
Cash movements
Drawdown of borrowings	14,000	-	8,000	-
Repayment of borrowings	(13,000)	-	(6,000)	-
Borrowing facilities arrangement and commitment fees	(657)	-	(1,040)	-
Interest paid	(5,166)	-	(5,165)	-
Payment of leasing liabilities	-	(2,860)	-	(3,373)
Non-cash movements
Interest and other finance costs	6,041	403	6,078	315
New leases	-	1,645	-	1,173
Lease modifications	-	1,209	-	362
	56,742	15,365	55,524	14,968

Corporate governance

Financial statements

Overview

Strategic Report

continued

31. Financial risk management

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RM plc

Annual report and financial statements 2025

181

Foreign currency risk

a) Translation

The Group is exposed to the translation risk of assets and liabilities held in overseas subsidiaries being translated in the Group’s results at

rates of exchange effective at the balance sheet date. The Group also maintains foreign currency denominated cash accounts, but only

holds balances required to settle its payables.

b) Transaction

Operations are also subject to foreign exchange risk from transactions in currencies other than their functional currency and, once

recognised, the revaluation of foreign currency denominated assets and liabilities. Principally, this relates to transactions arising in US

dollars and Indian rupees. Specifically, the Group purchases a proportion of its inventory in US dollars and operating costs in the Group’s

subsidiary RM Education Solutions India Private Limited are in Indian rupees. The Group also receives US dollars from certain customers.

In order to manage the Indian rupee risk, the Group enters into derivative transactions in the form of forward foreign currency contracts.

To manage the Indian rupee to pounds sterling risk, the contracts purchased are designed to cover 25% to 90% of forecast rupee costs and

are renewed on a revolving quarterly basis, looking out up to 12 months.

The Group matches the inflows and outflows of US dollars as

much as possible to manage the US dollar risk.

Hedge accounting was achieved for the year, and the effective portion of changes in the fair value of derivatives was recognised in other

comprehensive income. Hedging was transacted in Indian rupee for the whole year.

The total amount of outstanding forward foreign exchange contracts to which the Group was committed was:



	At 30 November 2025
		Forward	Forward	Mark-to-
		contract value	contract value	market value	Fair value
Currency	Contract type	Currency ‘000	£000	£000	£000
Indian rupee	Buy	75,000	(674)	(634)	(40)
			(674)	(634)	(40)



	At 30 November 2024
		Forward	Forward	Mark-to-
		contract value	contract value	market value	Fair value
Currency	Contract type	Currency ‘000	£000	£000	£000
Indian rupee	Buy	721,000	(6,640)	(6,662)	22
			(6,640)	(6,662)	22

Derivative financial instruments are stated at fair value at the balance sheet date and are included within trade and other receivables and

trade and other payables. The fair value of the derivative financial instruments is estimated by discounting the future contracted cash flow,

using readily available market data and represents a level 2 measurement in the fair value hierarchy under IFRS 7.

Of these, forward foreign currency exchange contracts with a contract value of £674,000 (2024: £6,640,000) and fair value of £40,000

liability (2024: £22,000 asset) have been designated as effective hedges in accordance with IFRS 9 Financial Instruments: Recognition and

Measurement. The movement in fair value of hedging derivative financial instruments during the year was a net charge of £62,000 (2024:

credit of £424,000) which has been recognised in other comprehensive income and presented in the hedging reserve in equity.

The Group has established a hedge ratio of 1:1 as the underlying risk of the forward foreign currency exchange contracts are identical to

the hedged risk. Hedge ineffectiveness can arise from changes to the forecasted amount of cash flows in Indian rupee. No ineffectiveness

was identified in the forward foreign currency exchange contracts that have been designated hedges in accordance with IFRS 9 Financial

Instruments: Recognition and Measurement at 30 November 2025 or at 30 November 2024.

All rupee forward contracts are non-deliverable and are settled on a net basis.

c) Foreign exchange rate sensitivity

The following table details how the Group’s income and equity would increase/(decrease) if there were a 10% increase in the amount

of the respective currency that could be purchased with pounds sterling at the balance sheet date (assuming all other variables remain

constant) (for example from $1.27: £1 to $1.40: £1). The sensitivity analysis includes only outstanding foreign currency denominated

monetary items and adjusts their translation at the period end for a 10% change in foreign currency. A reasonably possible 10% weakening

of pounds sterling against the relevant currency would be estimated to have a comparable but opposite impact on income and equity.

The total amount of outstanding forward foreign exchange contracts to which the Group was committed was:

Notes to the

continued

financial statements

continued

31. Financial risk management

182

RM plc

Annual report and financial statements 2025

| | | | | |
| --- | --- | --- | --- | --- |
| | |
| | At 30 November 2025 | | At 30 November 2024 | |
| | Nominal value | Fair value | Nominal value | Fair value |
| Group | £000 | £000 | £000 | £000 |
| Forward foreign exchange contracts | 674 | (40) | 6,640 | 22 |

Sensitivity



	At 30 November 2025		At 30 November 2024
	Income	Equity	Income	Equity
Group	£000	£000	£000	£000
10% increase in foreign exchange rates against pounds sterling:
US dollar	(294)	-	287	-
Australian dollar	27	-	2	-
Indian rupee	102	4	71	(2)

All the forward exchange contracts mature within one year.

In management’s opinion, the sensitivity analysis is unrepresentative of the inherent foreign exchange risk, as the analysis does not reflect

management’s proactive monitoring methods and processes for exchange risk.

Interest rate risk

The only significant interest-bearing financial assets or liabilities relate to the Group’s borrowings referred to below. During the year,

adjusted average net debt was £57.8m (2024: £53.8m) and the maximum borrowings position was £63.3m (2024: £60.7m).

At 30 November 2025 the Group had a £70.0m committed revolving credit facility with HSBC Bank plc and Barclays Bank plc to July

2027, which was originally signed on 5 July 2019. During the year, the Group secured an agreement with Lenders, which extended the

existing £70.0m facility to July 2027. The fixed charge over the shares of each of the obligor companies (except for RM plc), and the fixed

and floating charge over all assets of the obligor companies granted previously to Lenders remains in place. Under the amended facility

covenants have been reset as follows:

•

A quarterly LTM (last twelve months) EBITDA covenant test to November 2026, which is then replaced by a quarterly EBITDA leverage

test and interest cover, which are required to be below 4.5x and above 4x respectively from February 2027; and

•

A hard liquidity covenant test requiring the Group to have liquidity greater than £7.5m on the last business day of the month, and liquidity

not be below £7.5m at the end of two consecutive weeks within a month. This liquidity limit is the minimum amount the Group must

have available under the facility, taking into account cash and the amount left to draw.

Separate to this, the Group has a number of performance bonds relating to potential liabilities arising in connection with any Local

Government Pension Scheme that the Company participates in as a result of its managed services contracts in the RM Technology

division (which are included in the net pension surplus). The Group also has financial guarantees covering payments to suppliers and other

performance guarantees for the RM Assessment, Technology and Resources businesses.

Interest is payable either weekly, monthly or quarterly based on the drawdown frequency. The interest payable on loans under the

revolving credit facility is between 3.35% and 4.25% (the Margin) above SONIA for the remainder of the committed term subject to certain

financial ratios. A commitment fee of 40% of the Margin was payable on the unutilised balance and an arrangement fee of £472,404 (2024:

£473,000) and independent business review fees and costs of £185,015 (2024: £566,000) were paid in 2025. The fees are recognised in

the consolidated income statement on an effective interest rate basis over the duration of the facility.

Financial covenants during the year were on a rolling 12-months minimum EBITDA basis. At 30 November 2025 the minimum EBITDA

covenant required was £9.7m versus actual EBITDA of £15.5m. The £58.0m drawn down at 30 November 2025 is not contractually due for

repayment until July 2027.

Corporate governance

Financial statements

Overview

Strategic Report

continued

31. Financial risk management

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Annual report and financial statements 2025

183

The interest and currency profile of bank loans and cash and cash equivalents is shown below:



	2025			2024
	Floating rate	Interest free	Total	Floating rate	Interest free	Total
Group	£000	£000	£000	£000	£000	£000
Pounds sterling cash and cash equivalents	-	4,642	4,642	-	5,830	5,830
US dollar	-	717	717	-	471	471
Euro	-	120	120	-	185	185
Indian rupee	296	-	296	535	-	535
Singapore dollar	-	304	304	-	148	148
Australian dollar	-	10	10	-	810	810
New Zealand dollar	-	76	76	-	50	50
Swedish krona	-	1	1	-	167	167
Cash and cash equivalents	296	5,870	6,166	535	7,661	8,196
Bank loan – pounds sterling	58,000	-	58,000	57,000	-	57,000

The weighted average effective interest rates at the balance sheet date on interest bearing financial assets and liabilities were as follows:



	2025		2024
		Weighted		Weighted
		average		average
	Floating rate	interest rate	Floating rate	interest rate
Group	£000	%	£000	%
Financial assets
Cash and cash equivalents	296	0.00	535	0.00
Financial liabilities
Overdrafts	-	0.00	4,325	9.62
Bank loans	58,000	8.46	57,000	9.23

Interest rate sensitivity (assuming all other variables remain constant):



	2025		2024
	Income	Equity	Income	Equity
	sensitivity	sensitivity	sensitivity	sensitivity
Group	£000	£000	£000	£000
1% increase in interest rates	(580)	(580)	(570)	(570)
1% decrease in interest rates	580	580	570	570

Credit risk

The Group’s principal financial assets are bank balances and trade and other receivables. The Group’s credit risk is primarily attributable

to its trade receivables and accrued income. Credit checks are performed on new customers and before credit limits are increased. The

amounts presented in the balance sheet are net of allowances for expected credit losses. Note 20 includes an analysis of trade receivables

by type of customer and of the ageing of unimpaired trade receivables.

The credit risk on cash and cash equivalents (the geographic risk profile of which is set out above), liquid funds and derivative financial

instruments is limited because the counterparties are investment grade banks rated BBB+ and above. The Group has no significant

concentration of credit risk, with exposure spread over a large number of counterparties and customers and a large proportion are schools

and educational institutions which are ultimately backed by the UK Government.

The carrying amount of financial assets represents the maximum credit exposure. The Group does not hold any collateral to cover its risks

associated with financial assets.

Notes to the

continued

financial statements

continued

31. Financial risk management

184

RM plc

Annual report and financial statements 2025

Liquidity risk

Cash is managed to ensure that sufficient liquid funds are available with a variety of counterparties to meet short, medium and long-term

cash flow forecasting requirements. The Group has access to overdraft and borrowing facilities (see Interest rate risk section) which mean

that the Group can continue to meet its liabilities as they fall due.

The Group has approached its maximum borrowing limits during the year with borrowings under the facility of £58.0m at year end and has

worked with its lenders to maintain liquidity. The Group has prepared cash flow forecasts for the period to the end of March 2027 which

indicate that the Group is expected to comply with all debt covenants in place and will have sufficient funds to meet its liabilities as they fall

due for at least 12 months from the date of this report.

Full details of the terms of the Group’s facility, including financial covenants and the Group’s performance under those financial covenants

during the year are set out in Note 25.

Maturity profile of financial liabilities

The table below highlights the maturity profile of the financial liabilities:



				Derivative
	Trade	Lease	Other	financial
At 30 November 2025	payables	liabilities	payables	instruments	Accruals	Borrowings 1	Total
Group	£000	£000	£000	£000	£000	£000	£000
Within one year	17,672	2,413	3,894	40	6,302	4,768	35,089
Between one and two years	-	2,333	-	-	-	61,178	63,511
Between two and five years	-	5,853	-	-	-	-	7,190
More than five years	-	6,468	-	-	-	-	5,131
Total contractual cash flows	17,672	17,067	3,894	40	6,302	65,946	110,921
Carrying amount	17,672	15,365	3,894	40	6,302	56,742	100,015

Borrowings are detailed in Note 25, the profile for the year ended 30 November 2025 reflects the cash flows to the facility extension date of 5 July 2027.



					Borrowings
	Trade	Lease	Other		and
At 30 November 2024	payables	liabilities	payables	Accruals	overdrafts 1	Total
Group	£000	£000	£000	£000	£000	£000
Within one year	13,748	2,430	3,224	7,340	9,341	36,083
Between one and two years	-	1,919	-	-	60,344	62,263
Between two and five years	-	4,356	-	-	-	4,356
More than five years	-	7,668	-	-	-	7,668
Total contractual cash flows	13,748	16,373	3,224	7,340	69,685	110,370
Carrying amount	13,748	14,968	3,224	7,340	59,849	99,129

Borrowings are detailed in Note 25, the profile for the year ended 30 November 2024 reflects the cash flows to the facility extension date of 5 July 2026.

Capital management

The Group’s policy is to maintain a strong capital base to maintain investor, creditor and market confidence so as to sustain future

development of the business. Management monitors the return on capital, as well as the level of dividends to ordinary shareholders and

contributions to the defined benefit pension schemes.

Corporate governance

Financial statements

Overview

Strategic Report

rm.com

RM plc

Annual report and financial statements 2025

185

32. Related party transactions

a) Key management personnel

The remuneration of the Group’s key management personnel during the year, which consisted of the Group’s Directors and members of

the Executive management team, was as follows:



	Year ended	Year ended
	30 November	30 November
	2025	2024
Group	£000	£000
Short-term employee benefits	3,787	2,349
Post-employment benefits	103	68
Termination benefits	330	230
Share-based payment expense	954	605
	5,174	3,252

Share-based payments above include fair value charges for Executive Directors of £406,315 (2024: £200,529) in respect of awards to Mark

Cook and £164,489 (2024: £81,073) in respect of awards to Simon Goodwin.

Further information about the remuneration of individual Directors is provided in the audited section of the Remuneration Report.

b) Transactions between the Company and its subsidiary undertakings

During the year, the Company entered into the following transactions with its subsidiary undertakings:



	Year ended	Year ended
	30 November	30 November
	2025	2024
Company	£000	£000
Payments:
Management recharges	1,339	1,382
Net intercompany interest payable	3,189	2,052

Total amounts owed between the Company and its subsidiary undertakings are disclosed in Notes 20 and 22 respectively.

c) Other related party transactions

The Group encourages its Directors and employees to be governors, trustees or equivalent of educational establishments. The Group

trades with these establishments in the normal course of its business.

Searchlight Business Services Limited

Mark Cook, an Executive Director, is the Non-Executive Chair of Searchlight Business Services Ltd. The Group has purchased services of

£135,191 (2024: £465,212) relating to recruitment and executive search fees. Mark was not involved in the commercial discussions relating

to this supply. At the year end, there was £57,910 payable (2024: £nil), which was unsecured.

33. Post balance sheet events

On 30 December 2025 RM Pension Scheme Trustee Limited, a dormant subsidiary of the Company, was dissolved.

On 8 January 2026 ownership of the Company’s direct dormant subsidiary, TTS Group Limited, was transferred to RM Educational

Resources Limited.

On 29 January 2026 the Company’s indirect dormant subsidiary RM Education Research Machines Limited was renamed RM Education

Assessment Limited, and on 6 February 2026 ownership of this entity was transferred from RM Education Limited to the Company.

On 17 February 2026 ownership of the Company’s indirect subsidiary, RM T T S Trading LLC, was transferred from RM Education Holdings

Limited to RM Educational Resources Limited.

Glossary

The use of Company refers to RM plc. The use of Group refers to

RM plc and its subsidiary undertakings covered by the consolidated

accounts.

Investor information

Information for investors is available on the RM website. Enquiries

can be directed to Daniel Fattal, Company Secretary, at the Group

head office address or at [email protected].

Registrars and shareholding information

Shareholders can access the details of their holdings in RM plc

via the Shareholder Services option within the investor section of

the corporate website. Shareholders can also make changes to

their address details and dividend mandates online. All enquiries

about individual shareholder matters should be made to the

Company’s registrar, MUFG Corporate Markets, either via email

at [email protected] or by telephone

to 0371 664 0300. Calls are charged at the standard geographic

rate and will vary by provider. Calls outside the United Kingdom

will be charged at the applicable international rate. Lines are open

between 09:00 - 17:30, Monday to Friday excluding public holidays

in England and Wales.

To help shareholders, the MUFG Corporate Markets’ Share Portal

at www.signalshares.com contains a frequently asked questions

section for shareholders.

Electronic communication

Shareholders are able to receive Company communication via

email. By registering your email address, you will receive emails

with a web link to information posted on our website. This can

include our report and accounts, notice of meetings and other

information we communicate to our shareholders.

Electronic communication brings numerous benefits, which

include helping us reduce our impact on the environment,

increased security (your documents cannot be lost in the post or

read by others) and faster notification of information and updates.

To sign up to receive e-communications go to MUFG Corporate

Markets’ Investor Centre at https://uk.investorcentre.mpms.mufg.

com. All you need to register is your investor code, which can be

found on your share certificate or your dividend tax voucher. The

Investor Centre is a secure online site where you can manage your

shareholding quickly and easily. You can check your shareholding

and account transactions, change your name, address or dividend

mandate details online at any time and vote online via the the

Investor Centre.

Beneficial shareholders with ‘information rights’

Please note that beneficial owners of shares who have been

nominated by the registered holders of those shares to receive

information rights under section 146 of the Companies Act 2006

are required to direct all communications to the registered holder

of their shares rather than to MUFG Corporate Markets, or to the

Company directly.

Multiple accounts on the shareholder register

If you have received two or more copies of this document, it may

be because there is more than one account in your name on

the shareholder register. This may be due to either your name or

address appearing on each account in a slightly different way. You

can portfolio your accounts on MUFG Corporate Markets’ Investor

Centre at https://uk.investorcentre.mpms.mufg.com.

Shareholder

information

RM plc

Annual report and financial statements 2025

186

Company

information

Company Secretary

Daniel Fattal RM plc

142B Park Drive

Milton Park

Abingdon

Oxfordshire OX14 4SE

Group head office and registered office

142B Park Drive

Milton Park

Abingdon

Oxfordshire OX14 4SE

Telephone: +44 (0)1235 645 316

Registered number

RM plc’s registered number is 01749877

Corporate website

Information about the Group’s activities is available from

www.rmplc.com.

Auditor

RSM UK Audit LLP

25 Farringdon Street

London EC4A 4AB

Financial advisors and stockbrokers

Singer Capital Markets

1 Bartholomew Lane

London EC2N 2AX

Financial Public Relations

Headland PR Consultancy LLP

1 Suffolk Lane

London EC4R 0AX

Registrar

MUFG Corporate Markets

Central Square

29 Wellington Street

Leeds LS1 4DL

Legal advisor

Osborne Clarke

One London Wall

London EC2Y 5EB

RM plc

Annual report and financial statements 2025

rm.com

187

Overview

Strategic Report

Corporate governance

Financial statements

RM plc

Annual report and financial statements 2025

188

RM plc

Annual report and financial statements 2025

rm.com

189

Overview

Strategic Report

Corporate governance

Financial statements

142B Park Drive

Milton Park

Milton

Abingdon

Oxfordshire

OX14 4SE

RM plc’s registered number is 01749877

Telephone: +44 (0)1235 645 316

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