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World Chess PLC — Annual Report (ESEF) 2025
Apr 27, 2026
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World Chess PLC
Annual Report & Financial Statements for the year ended 31 December 2025
Company Registration No. 10589323 (England and Wales)
World Chess Plc – Company Registration No. 10589323
CONTENTS
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| Page | |
|---|---|
| COMPANY INFORMATION | 3 |
| STRATEGIC REPORT | |
| Highlights and Principal Activities | 4 |
| Our Vision, Mission, and Values | 4 |
| Statement from the Chair | 5 |
| Statement from the Chief Executive | 6 |
| Operational Review | 7 |
| Financial Review | 9 |
| Managing Risk, Threats, and Opportunities | 12 |
| Our Principal Risks – related to the Company's business and industry | 12 |
| Climate-Related Financial Disclosures | 13 |
| s. 172 Statement | 17 |
| GOVERNANCE | |
| Corporate Governance Statement | 19 |
| QCA Code – Application of the Ten Principles of Corporate Governance | 20 |
| Board of Directors | 28 |
| Audit Committee Report | 32 |
| Directors’ Remuneration Report | 34 |
| Directors’ Report | 39 |
| Statement of Directors’ Responsibilities | 45 |
| Independent Auditors’ Report | 46 |
| FINANCIAL STATEMENTS | |
| Consolidated Statement of Profit or Loss and Other Comprehensive Income | 54 |
| Consolidated Statement of Financial Position | 55 |
| Company Statement of Financial Position | 56 |
| Consolidated Statement of Changes in Equity | 57 |
| Company Statement of Changes in Equity | 57 |
| Consolidated Statement of Cash Flows | 58 |
| Company Statement of Cash Flows | 59 |
| Notes to the Statements of Cash Flows | 60 |
| Notes to the Consolidated Financial Statements | 62 |
World Chess Plc – Company Registration No. 10589323
COMPANY INFORMATION
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Directors
Ilya Merenzon (Chief Executive Officer)
Matvey Shekhovtsov (Chief Operating Officer)
Richard Collett (Chief Financial Officer)
Graham Woolfman (Chair) - resigned on 14 February 2025
Jamison Reed Firestone (Non-Executive Director)
Neil Rafferty (Non-Executive Director, appointed interim Chair 14 February 2025)
Company No. 10589323 - incorporated in England and Wales
Secretary and Registered Office
MSP Corporate Services Ltd
Eastcastle House
27/28 Eastcastle Street
W1W 8DH
Financial Adviser
AlbR Capital Limited
3rd Floor, 80 Cheapside
London EC2V 6EE
Auditor
Moore Kingston Smith LLP
6 th Floor
9 Appold Street
London EC2A 2AP
Legal advisers
Marriott Harrison LLP
80 Cheapside
London EC2V 6EE
Registrar
Share Registrars Ltd
3 The Millennium Centre
Crosby Way
Farnham GU9 7XX
World Chess Plc – Company Registration No. 10589323
STRATEGIC REPORT
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Highlights and Principal Activities
Results for the year
* Revenue from continuing operations was €2,029,433 (2024: €1,820,801).
* Total revenue including discontinued operations was €2,262,115 (2024: €2,434,173).
* The loss before tax from continuing operations was €2,685,342 (2024: €2,822,879).
* The loss from discontinued operations net of tax was €974,407 (2024: €972,050).
* The total loss was €3,659,941(2024: €3,795,146).
Operational and strategic highlights
* Exceeded one million registered users
* Launched The Tower, a new player progression and engagement system
* Rebuilt and relaunched the World Chess mobile application
* Appointed Head of Mobile Design, formerly of Chess.com
* Migrated platform to unified worldchess.com domain
* Launched The World Chess Show across international broadcast networks
* Extended partnership with the Algorand Foundation; added TipRanks as commercial partner
* Began development of club and federation technology tools, extending the platform beyond consumer play into the infrastructure of organised chess globally
* India now represents 33% of paid subscribers and 25% of total registered users.
Our Vision, Mission, and Values
Our mission
World Chess exists to make chess a sport the world plays and follows. Everything else flows from that.
Our vision
A world where chess is a modern sport with a real audience — not a niche pursued by enthusiasts, but a global game with the infrastructure, the drama, and the accessibility it deserves.
How we operate
* Casual players first. Our economic foundation is the player who subscribes, watches, and comes back. Every product decision passes one test: does this serve the person who loves chess but isn't a grandmaster? Elites are the content. Casual players are the customer.
* Commercial success is the mission. Making money is not a compromise of our values — it is how we achieve them. Most chess organisations that depended on patronage or goodwill have failed to scale. We are building a sustainable business
* Chess is global, and so are we. India is not an emerging market to exploit — it is one of our core markets to serve. We build for every region and price for local realities.
* We compete, we don't destroy. We are building an alternative to the existing chess establishment. We are not trying to burn down what exists. If we succeed, the whole ecosystem benefits. We want a bigger sport, not just a bigger slice of a small one.
World Chess Plc – Company Registration No. 10589323
STRATEGIC REPORT
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Statement from the Chair
2025 marked an important year for World Chess as the Group sharpened its strategic focus and strengthened the foundations for future growth. The business reached a significant milestone of over one million registered users, launched a rebuilt mobile application, and continued to enhance its platform and commercial partnerships.
A key priority during the year was the reallocation of resources towards scalable, digital revenue streams. Following a strategic review, the Board made the decision to close the Berlin Chess Club and concentrate investment on product development and the growth of the Group’s online subscriber base. This reflects our conviction that long-term value will be driven by a focused, technology-led model.
Financially, while revenues declined modestly, the Group delivered a slightly improved performance with a reduction in loss before tax from continuing operations to €2,685,342 from €2,822,879 in 2024. This reflects increasing cost discipline alongside continued targeted investment in the platform, positioning the business for more efficient growth.
The Group also strengthened its capital base during the year, securing investment from strategic partners with deep experience in digital product development and scaling technology businesses. Their engagement brings not only capital but also valuable expertise as the Company executes its strategy. The Board continues to engage with additional funding partners to ensure the Group is well capitalised for its next stage of development.
The Board has maintained a strong focus on governance, liquidity and risk management, while supporting management in prioritising product investment and operational efficiency. Having supported the Company through its IPO and more recently as Interim Chair during this period of strategic refocus, I believe the business is now well positioned for its next phase. Accordingly, I decided to resign as Chair in February 2026 in order to enable to Board to refresh its skill set to be more in line with its refocussed approach and agreed to remain in place until the 11 May or earlier should a new appointment be made before then.
I would like to thank my fellow Directors and the management team for their commitment and contribution during this period, and I look forward to seeing the Company build on its progress in the years ahead. Finally, the Board remains confident in the Group’s strategy and its long-term potential I would like to thank our shareholders, partners and employees for their continued support.
Neil Rafferty
Interim Chairman
20 April 2026
World Chess Plc – Company Registration No. 10589323
STRATEGIC REPORT
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Statement from the Chief Executive
A million people choose to play chess on World Chess. Hopefully, you are one of them! Today we have a platform with over a million registered users, a mobile application rebuilt from scratch, a progression system that keeps players coming back, and a Head of Mobile Design we hired from the market leader. The gap between where we were and where we are is significant.But the gap between where we are and where we would like to be is the opportunity. India, and Asia in general, is the story within the story. Gukesh D, a teenager, is World Chess Champion. A golden generation of Indian players is rewriting what's possible in chess, and Indian players now make up 33% of our paid subscriber base and 25% of our total registered users. We are not chasing that market — we are in it, growing in it, and investing to deepen it. We believe that the product, worldchess.com, is better than it has ever been, and the engagement numbers support this. Post-game analysis gives subscribers real value — it makes people better at chess with every game. The new mobile app — which launched in November — is the platform we always wanted to build. The unification of all our products under the worldchess.com domain made it easier for any player, anywhere, to find us and start playing. We are also moving beyond the consumer platform. Chess has hundreds of thousands of clubs globally — running events on spreadsheets and paper scoresheets. We are building tools that change that: technology for clubs to manage events, run rated competitions, and connect their members to the wider World Chess ecosystem. This is a large, largely untouched market, and our position in the chess world puts us in a uniquely credible place to serve it. The financial reults for 2025 reflect a company investing in its future — the majority of expenditure went into product development. The loss before tax narrowed. We raised capital from investors who understand digital products and are actively contributing to our roadmap. There is more to do — we are focused on scale, bringing in more users from around the world and offering them new and interesting ways to enjoy chess.
Ilya Merenzon
Chief Executive Officer
20 April 2026
World Chess Plc – Company Registration No. 10589323
STRATEGIC REPORT
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Operational review
Key Performance Indicators (KPIs)
The Group uses a number of KPIs within the business. The principal financial metrics are Revenue, Gross Profit and Loss before tax which are included in the Statement of Profit or Loss and Other Comprehensive Income.
| 2025 € | 2024 € | Reasons for movement | |
|---|---|---|---|
| Revenue | 2,029,433 | 1,820,801 | Increase driven by growth in the World Chess Online Arena, including higher subscription income and improved monetisation, partially offset by lower merchandising revenue. |
| Gross Profit | 609,532 | 489,002 | Improved gross profit reflects higher-margin digital revenues from the Online Arena and a shift away from lower-margin physical and merchandising activities. |
| Loss before tax from continuing operations | (2,685,342) | (2,822,879) | Reduction in loss reflects revenue growth and cost optimisation following the closure of the Berlin club, with the results of the Berlin operations presented within discontinued operations (see note 8), partially offset by continued investment in product development and marketing to support the Online Arena. |
During the year, the Group reviewed its key performance indicators following the closure of the Berlin Club and its increased focus on the Online Arena. As part of this review, certain KPIs, including social media coverage, have been removed. The Group is developing additional operational KPIs — including conversion rate, churn, and customer satisfaction — to be introduced in future reporting periods.
| 2025 No. | 2024 No. | Reasons for movement | |
|---|---|---|---|
| Number of registered users | 1,050,000 | 989,036 | Increase reflects continued growth in the World Chess Online Arena, with a focus on expanding the free user base as part of the Group’s monetisation strategy. |
| Number of paid subscriptions | 8,736 | 10,310 | Decrease reflects a deliberate reduction in discounted subscription offerings and a shift towards full-price pricing and monetisation of the expanded free user base. |
Online Arena
The most significant structural development in 2025 was the consolidation of the platform onto a single unified domain — worldchess.com. The migration, completed during the year, simplifies the user journey, strengthens the brand, and creates one destination for the Group's full product offering: play, ratings, titles, content, and community. New features launched during the year include The Tower — a progression and engagement system designed to increase session frequency and support conversion to paid membership — and expanded post-game analysis for subscribers. Both were developed in direct response to player data, with the explicit aim of improving conversion and reducing churn.
World Chess Plc – Company Registration No. 10589323
STRATEGIC REPORT
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The redesigned mobile application launched on 1 November 2025, featuring a new interface, faster gameplay, and an expanded feature set. To lead this effort, the Group appointed a new Head of Mobile Design with prior senior experience at Chess.com — bringing proven expertise in designing chess products at scale. With the majority of online chess now played on mobile, this relaunch is central to the Group's 2026 growth strategy.
Club and Federation Technology
World Chess is developing technology tools that extend the platform into the global network of chess clubs and federations. These tools enable clubs to run their own rated events, manage members, and connect competitive results to the broader World Chess ecosystem. The global club infrastructure is large, active, and underserved by modern technology — and World Chess is naturally positioned to serve it. Development is ongoing, with further updates to be provided in due course.
Content and Media
The World Chess Show launched during the year, distributing chess programming across international broadcast networks. The show extends World Chess's reach beyond its registered user base and functions as both a brand-building vehicle and an audience acquisition channel — with the explicit goal of converting viewers into players.
Partnerships
Commercial partnerships active during 2025 include the renewal and extension of the Algorand Foundation agreement and a new collaboration with TipRanks. Both partnerships combine commercial value with distribution reach.
India
India is the Group's primary growth market. Indian users account for 25% of all registered users and 33% of paid subscribers — a concentration that reflects both the country's extraordinary chess moment and the deliberate product and marketing investment made in the market. With the lowest user acquisition costs globally, a highly engaged player base, and a national narrative around chess excellence, India is expected to remain the engine of user growth through 2026 and beyond.
Strategic developments and board update
World Series of Chess
During 2025, the Group continued to develop the World Series of Chess, a proposed, year-round competitive circuit designed to establish chess as a regular broadcast sport with democratic qualification from amateur to professional level, both online and over the board. The Series will aim to build on the success of the Group's Armageddon format, which was broadcast live across more than 150 markets and is intended to serve as both a standalone media property and a driver of platform engagement and subscriber acquisition. Preparatory work during the year included format development, broadcast partnership discussions, and sponsorship planning. The Board will provide further updates on the Series launch timeline in once this is confirmed.
Board composition
In February 2026, Neil Rafferty gave notice of his resignation as Interim Chair and Non-Executive Director, effective 11 May 2026. Mr Rafferty has served on the Board since the Company's IPO and took on the role of Interim Chair in February 2025. The Board is grateful for his contribution during a formative period for the Company. The Company has commenced a process to appoint a permanent Chair and will make a further announcement in once a candidate has been selected. The Board is seeking a candidate with experience in scaling media, technology and sports businesses.
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STRATEGIC REPORT
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Financial Review
During the year, the Group completed a significant strategic transition, with the closure of its Berlin club venue and an increased focus on the development of the World Chess Online Arena and related digital activities. This shift reflects the Group’s strategy to move towards a more scalable, capital-light digital business model. The closure of the Berlin venue resulted in a reduction in physical revenues and the recognition of one-off items, including the impairment of non-current assets, partially offset by the derecognition of the associated lease liability and the release of a dilapidations provision. These impacts are presented within discontinued operations (see note 8). In parallel, the Group continued to invest in the development of the Online Arena and related content activities.
| 2025 € | 2024 € | |
|---|---|---|
| REVENUE | 2,029,433 | 1,820,801 |
| GROSS PROFIT | 609,532 | 489,002 |
| GROSS PROFIT % | 30% | 27% |
| Administrative expenses | (3,274,230) | (3,289,653) |
| OPERATING LOSS | (2,664,698) | (2,800,651) |
| Addback: Depreciation and amortisation | 649,996 | 581,198 |
| LOSS BEFORE DEPRECIATION, AND AMORTISATION | (2,014,702) | (2,219,453) |
| Finance costs | (21,856) | (22,367) |
| Finance income | 1,212 | 139 |
| LOSS BEFORE INCOME TAX – CONTINUING OPERATIONS | (2,685,342) | (2,822,879) |
Revenue and Gross Profit
Total revenue, including discontinued operations, decreased by 7% to €2,262,115 (2024: €2,434,173), reflecting the closure of the Berlin club. Revenue from discontinued operations reduced to €232,682 (2024: €613,372). Revenue from continuing operations increased by 11% to €2,029,433 (2024: €1,820,801), driven by growth in digital and media activities. The World Chess Online Arena continued to scale, with revenues increasing by 25% to €863,751 (2024: €691,144), reflecting improved user engagement and monetisation.Tournament and content revenues also increased to €545,508 (2024: €394,736), supported by expanded production and broadcast activity, including World Chess TV. Merchandising revenues declined to €542,491 (2024: €734,921), reflecting reduced physical activity following the closure of the Berlin venue. Gross profit from continuing operations increased to €609,532 (2024: €489,002), with gross margin improving to 30% (2024: 27%), driven by a higher proportion of digital revenues.
Operating costs and profitability
Administrative expenses on a continuing basis remained broadly stable at €3,274,230 (2024: €3,289,653), reflecting ongoing cost discipline alongside continued investment in product development and growth of the World Chess Online Arena. The operating loss from continuing operations reduced to €2,664,698 (2024: €2,800,651), reflecting improved gross margins and stable operating costs.
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Loss before tax from continuing operations was €2,685,342 (2024: €2,822,879), with lower finance costs contributing marginally to the improvement. Loss per share improved to €0.005 (2024: €0.006), reflecting the reduced loss and an increase in the weighted average number of shares in issue.
Cash flows
Net cash used in operating activities of €2,491,890 (2024: €2,356,219), reflected continued investment in growth and platform development. The cash outflow from investing activities totalled €163,129 (2024: €1,009,385), with prior year spend reflecting higher levels of platform development and capital expenditure. These outflows were funded by €2,454,118 of cash generated from financing activities (2024: €3,433,366), primarily through equity funding. The overall movement in cash also reflects foreign exchange movements and cash flows relating to discontinued operations.
Statement of Financial Position
At 31 December 2025, the Group reported net assets of €1,458,391 (2024: €950,770). The increase reflects equity funding received during the year, partially offset by losses incurred and the impairment of assets associated with the Berlin club following its closure. Included within equity is €1,016,703 (2024: €2,016,703) relating to funds received under subscription agreements for shares not yet issued at the reporting date. The Group held cash balances of €40,732 (2024: €267,396) and had no external borrowings at the year end (2024: €2,705,817 excluding director balances), resulting in a net cash position of €40,732 compared to net debt of €2,438,421 in the prior year.
Investment and capital expenditure
The Group continued to prioritise investment in the World Chess Online Arena, with capitalised development expenditure of €479,237 (2024: €697,258). Total investment in the platform now amounts to €5,101,463, with a carrying value of €2,906,076 at 31 December 2025. The Directors have assessed the carrying value of intangible assets and investments based on detailed five-year forecasts (see notes 10 and 11). Following the closure of the Berlin club, the Company recognised a full impairment of its investment in World Chess Europe GmbH of €300,000, resulting in the investment being fully impaired to €nil at 31 December 2025.
Liquidity and subsequent events
Subsequent to the year end, the Group strengthened its liquidity position through additional equity funding. In February 2026, investors Valery Kurylau and Dmitri Lipnitsky invested approximately €1,359,000, supporting continued development and marketing of the World Chess Online Arena (see note 30).
Going concern
The Directors have prepared forecasts covering a period of at least twelve months from the date of approval of these financial statements, reflecting the Group’s focus on the World Chess Online Arena and continued cost management. The forecasts assume no additional funding beyond the €1,359,000 raised post year end. While revenue growth is expected, there remains uncertainty regarding its timing and scale, and additional funding may be required to provide further liquidity headroom. These conditions indicate the existence of a material uncertainty which may cast significant doubt on the Group’s ability to continue as a going concern. Nevertheless, after considering sensitivities and mitigating actions, the Directors have a reasonable expectation that the Group will have sufficient resources to meet its obligations as they fall due.
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Accordingly, the financial statements have been prepared on a going concern basis.
Richard Collett
Chief Financial Officer
20 April 2026
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Managing Risk, Threats, and Opportunities
Taking considered risk is an inherent part of business and investment activity. The Audit Committee is responsible for undertaking a formal risk assessment on an annual basis and reporting, by exception, on any material changes during the year affecting the risks to which the Group is exposed, as well as identifying potential emerging risks. This process provides a structured approach to identifying, assessing and managing risks and opportunities facing the Group.
The objective of the Group’s risk management framework is to minimise the likelihood of material adverse outcomes arising from events that could reasonably have been foreseen, while also recognising potential opportunities that may arise from changes in the Group’s operating environment. The principal risks currently facing the Group, together with the potential impact on the business, are set out below.
Our Principal Risks – related to the Company's business and industry
Subscriber growth
The Group’s ability to retain existing online subscribers and attract new subscribers is critical to the success of the World Chess Online Arena. Subscriber growth depends on a number of factors, including the quality and breadth of the products offered, the overall user experience and broader trends affecting online gaming and digital entertainment. Failure to maintain or grow the subscriber base could negatively impact the Group’s revenue growth and financial performance.
Platform stability
The reliable operation of the Group’s digital platforms is critical to maintaining user engagement and trust. Any significant disruption to the Group’s computer systems or software, or to systems operated by third-party service providers, could damage the Group’s reputation and result in a loss of users. The Group’s brand and reputation depend on the reliable performance of its cloud infrastructure, network infrastructure and content delivery systems. The Group therefore continues to invest in infrastructure resilience and monitoring to minimise the risk of service disruption.
Data security
A significant part of the Group’s business relies on its ability to comply with data protection legislation, including GDPR, and to adequately protect user data and privacy. Any actual or perceived failure to safeguard user data could significantly harm the Group’s reputation and potentially lead to regulatory action or legal claims. To mitigate this risk, the Group has strengthened its governance and compliance framework and has recently appointed a Head of Governance, Risk and Compliance to oversee data governance and information security across the organisation.
Fair play and anti-cheating
Cheating represents a significant challenge for online chess platforms and has the potential to undermine user confidence and the integrity of the platform. Players may attempt to use external assistance or software tools to gain an unfair advantage, particularly when attempting to improve their ratings. The Group employs a combination of technical analysis, machine learning tools and human oversight to detect and prevent cheating on the platform. The Group continues to invest in improving its anti-cheating systems and fair play controls as technology evolves. The Group also seeks to encourage players to participate in over-the-board (‘OTB’) chess, where physical tournament controls significantly reduce opportunities for cheating, thereby supporting the integrity of the broader chess ecosystem.
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FIDE Online Arena agreement
The Group operates the World Chess Online Arena as the official online chess platform recognised by FIDE. The current agreement has an initial term expiring in August 2026; the agreement provides for automatic renewal for a further five-year period unless FIDE elects to operate the platform itself or accept a bona fide third-party offer that World Chess does not match. The Group is in ongoing dialogue with FIDE regarding the continuation of the arrangement. While the Directors believe the relationship with FIDE remains strong, the agreement is important to the Group’s strategy and any failure to extend or maintain the agreement could have a material impact on the Group’s business.
Rating recognition and adoption
A key feature of the Online Arena is the ability for players to obtain FIDE-recognised ratings and titles through online play. As online ratings are relatively new, their broader adoption within the chess community continues to evolve. Further development of rules and procedures linking online ratings to traditional over-the-board (‘OTB’) ratings may be required, and acceptance of online-rated players in OTB tournaments may also depend on the development of additional regulations. Slower adoption of online ratings could affect the growth of the Online Arena.
Reliance on key personnel
The Group’s performance and development depend on the continued services of a small number of key management personnel. The loss of the services of one or more of these individuals could have an adverse effect on the Group’s operations and prospects.The Group seeks to mitigate this risk by developing its management team, implementing succession planning and strengthening operational processes.
Climate-Related Financial Disclosures
This climate-related disclosure forms part of World Chess PLC’s Strategic Report for the year ended 31 December 2025 and has been prepared in accordance with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and the climate-related disclosure requirements under the UK Listing Rules. The purpose of this disclosure is to provide transparent information on how climate-related risks and opportunities may affect the Group’s business model, strategy, governance and risk management processes. It outlines the processes and metrics used to identify, monitor and manage these matters, supporting the Group’s long-term objective to operate sustainably and responsibly.
The Board has overall responsibility for climate-related matters, with oversight exercised through the Group’s risk management framework and review by the Audit Committee. This disclosure covers the consolidated activities of World Chess PLC, including its subsidiaries and digital operations, consistent with the Group’s financial reporting boundary.
Materiality of climate-related risks
The Directors recognise the importance of assessing climate-related risks and opportunities. However, following the cessation of its Berlin venue and the Group’s transition to a predominantly digital-first business model, with limited physical infrastructure and relatively low direct energy consumption, the Directors currently consider the Group’s direct exposure to climate-related financial risks to be limited and not financially material to the Group’s operations. To support this assessment, the Group has undertaken scenario analysis as set out below.
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Scenario Analysis and Climate-Related Financial Impact
The Group has undertaken a high-level climate scenario analysis considering both a 1.5°C and a 2°C pathway. Consistent with its predominantly digital operating model, the analysis indicates limited exposure to direct physical climate risks. Transition risks, including regulatory change, increased disclosure requirements and evolving stakeholder expectations, were assessed qualitatively. Under a 1.5°C scenario, these may result in modest increases in compliance, supplier and operational costs; however, no material financial impact is currently expected in the short to medium term.
No material impacts have been identified on asset valuations, impairment assessments, or the Group’s going concern assumptions at the reporting date. The analysis has been informed by publicly available scenarios, including those from the IPCC and NGFS, and assumes continuation of the Group’s current business model and limited direct emissions footprint. The assessment is subject to limitations, including its qualitative nature, limited value chain data and inherent uncertainty in long-term climate projections. The Group will continue to enhance its scenario analysis over time, including the development of more quantitative financial impact assessments.
The Group’s principal exposure to climate-related factors arises indirectly through energy consumption associated with digital infrastructure and cloud hosting services, as well as Scope 3 emissions related to business travel and the delivery of chess events. While the financial impact of climate-related risks on the Group’s operations is not currently considered material, the Directors recognise that regulatory expectations and stakeholder requirements in this area are evolving. The Group will therefore continue to monitor developments in climate-related regulation, reporting standards and stakeholder expectations, and will update its approach as appropriate.
Time horizons for climate risk and opportunity assessment
The Group assesses climate-related risks and opportunities across three time horizons to reflect both operational planning cycles and long-term strategic considerations.
- Short-term (1–3 years): Focused on regulatory compliance, operational efficiency and managing the environmental impact of digital infrastructure.
- Medium-term (3–7 years): Evaluation of evolving climate-related regulation, sustainability expectations of stakeholders and opportunities to improve the environmental efficiency of digital infrastructure and event operations.
- Long-term (beyond 7 years): Assessment of structural changes to the global economy as it transitions to a lower-carbon model and potential implications for the Group’s strategy and operating environment.
These time horizons align with the Group’s strategic planning cycle and reflect the expected pace of regulatory change, technological development and evolving stakeholder expectations. Transition risks, such as enhanced climate disclosure requirements and increasing ESG expectations from investors and partners, are assessed primarily over the short- to medium-term, while potential physical risks, including extreme weather events affecting travel and event logistics, are considered over the medium- to long-term.
Strategy
World Chess PLC recognises that climate change may present both risks and opportunities for the Group’s business operations and long-term growth. Key areas where climate considerations intersect with the Group’s strategy include:
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Digital operations and energy efficiency
The Group’s digital platforms, including the World Chess Online Arena, rely on cloud computing infrastructure, which contributes to energy consumption and indirect emissions. The Group seeks to minimise its environmental footprint by prioritising energy-efficient hosting solutions and evaluating the use of data centres powered by renewable energy sources.
Event sustainability
Chess tournaments and events contribute to Scope 3 emissions primarily through participant travel and event logistics. Following the closure of the Berlin club venue, the Group’s exposure to venue-related energy consumption has reduced, and the focus is on managing travel-related emissions and working with partners and venues that support sustainable practices where appropriate.
Regulatory and market developments
The Group monitors developments in climate-related regulation and reporting requirements, including TCFD, SECR and emerging ISSB standards. Enhancing climate-related reporting capabilities remains a priority in order to meet evolving regulatory expectations and investor requirements.
Reputation and stakeholder expectations
Investors, sponsors and participants increasingly expect organisations to demonstrate responsible environmental practices. Strengthening the Group’s ESG reporting and sustainability practices supports the Group’s reputation and long-term brand value.
Actual and potential impacts of climate-related risks and opportunities
Potential climate-related impacts on the Group’s business include:
* increased regulatory and compliance costs;
* evolving stakeholder expectations regarding environmental responsibility;
* potential disruption to in-person events from weather-related factors; and
* reputational risks associated with insufficient climate action.
At the same time, opportunities may arise from improving digital efficiency, enhancing stakeholder engagement and positioning the Group as a responsible organiser of global chess events. Climate considerations are therefore incorporated into long-term planning, technology choices and event management decisions.
Resilience of the business model
The Group has considered the resilience of its business model under two climate scenarios aligned with TCFD guidance.
Orderly transition scenario (1.5°C)
This scenario assumes increasing regulatory requirements and stakeholder expectations, combined with accelerating investment in renewable energy and low-carbon technologies. Under this pathway, the Group’s digital-first strategy benefits from the adoption of energy-efficient infrastructure and lower-carbon hosting solutions.
Delayed or disorderly transition scenario (2°C+)
This scenario assumes delayed policy action followed by more abrupt regulatory changes and increased economic volatility. Potential impacts include cost volatility and increased compliance requirements. Based on qualitative scenario analysis, the Directors believe the Group’s business model remains resilient under both scenarios due to its primarily digital operating model, limited physical infrastructure and flexibility in event planning.
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Climate-related risks and opportunities
The Group categorises climate-related risks and opportunities as follows:
Transition risks (short- to medium-term)
* increasing regulatory disclosure requirements;
* rising stakeholder expectations regarding ESG performance; and
* potential increases in energy costs.
Physical risks (medium- to long-term)
* disruption to in-person events and travel from extreme weather or transport disruption; and
* potential supply chain impacts affecting event operations.
Opportunities (short-, medium- and long-term)
* use of renewable energy-powered digital infrastructure;
* partnerships with environmentally responsible venues; and
* strengthening the Group’s ESG credentials with investors and partners.
Risk management
Climate-related risks are integrated into the Group’s enterprise risk management framework. These risks are reviewed annually by senior management and the Audit Committee, with additional reviews undertaken where significant developments occur.The Group’s climate risk management process includes:
• identification and assessment of climate-related risks and opportunities;
• monitoring of regulatory developments and stakeholder expectations;
• integration of climate considerations into broader operational and strategic planning; and
• scenario analysis to assess the resilience of the business model.
Climate-related risks are included within the Group’s risk register, with defined ownership and oversight from the Board.
Metrics and targets
The Group monitors climate-related performance through a range of environmental metrics and indicators.
Greenhouse gas emissions
The Group reports Scope 1, Scope 2 and relevant Scope 3 emissions in accordance with the GHG Protocol and SECR requirements. Further details are included in the Directors’ Report.
Energy usage
Energy consumption associated with digital infrastructure and event operations is monitored to identify opportunities for efficiency improvements.
Sustainability indicators
Additional indicators monitored by the Group include:
• proportion of events held in energy-efficient venues;
• carbon intensity per digital user; and
• progress towards the use of renewable-powered cloud services.
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The Group’s medium-term objectives include:
• achieving a 10% reduction in emissions intensity (tCO₂e per €m revenue) by 31 December 2026, using 2024 as the baseline year; this target has not been formally amended, however, following the closure of the Berlin venue and the Group’s transition to a predominantly digital model, the Directors consider the target to be of reduced strategic significance and it is under review;
• transitioning to 100% renewable electricity for office and venue locations by 2027;
• reducing carbon intensity per digital user by 30% by 2030 (baseline year: 2024); and
• incorporating Scope 3 supplier engagement within the Group’s climate strategy by 2027.
The timing of this objective has been revised from 2025 to reflect changes in the Group’s supplier base following the closure of the Berlin club and the transition to a more digitally focused operating model. Progress against these objectives is reviewed annually by the executive team and monitored by the Audit Committee.
s. 172 Statement
Section 172(1) of the Companies Act 2006 requires the Directors to act in a way that they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole, and in doing so to have regard (amongst other matters) to:
• the likely consequences of any decision in the long term;
• the interests of the Company’s employees;
• the need to foster the Company’s business relationships with suppliers, customers and others;
• the impact of the Company’s operations on the community and the environment; and
• the desirability of the Company maintaining a reputation for high standards of business conduct.
The Board of Directors is collectively responsible for the long-term success of the Company. The Board considers the interests of all stakeholders when making strategic and operational decisions and ensures that appropriate governance, risk management and internal control frameworks are in place to support the delivery of the Group’s strategy. Further details of the Group’s strategy, performance and principal risks are set out in the Strategic Report on pages 4 to 24.
Employees
The interests and wellbeing of the Group’s employees are an important consideration in Board decision-making. The Group seeks to maintain an open and supportive working environment where employees are encouraged to contribute ideas and feedback. Training and professional development opportunities are provided to support career development and the retention of key skills within the business. Employees are regularly consulted through formal and informal communication channels, enabling staff to provide input into management decisions. Annual pay and benefit reviews are undertaken to ensure that remuneration remains competitive and aligned with the needs of the business. The Remuneration Committee oversees executive remuneration and makes recommendations to the Board in relation to executive compensation and share-based incentive arrangements.
Customers
The Group’s customers include both corporate partners and individual users of the World Chess Online Arena and related products. The Group seeks to deliver high-quality products and services by continuing to invest in product development, platform functionality and staff expertise. Maintaining strong relationships with customers and ensuring a high-quality user experience remain key priorities for the Group.
Suppliers and business partners
The Group maintains relationships with a network of suppliers, consultants and business partners who support the delivery of its operations across digital platforms, events and commercial activities. The Board
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recognises the importance of maintaining constructive and long-term relationships with these stakeholders and seeks to engage with suppliers in a transparent and fair manner.
Community
The Group seeks to contribute positively to the communities in which it operates, including through the organisation of chess tournaments, educational initiatives and partnerships with local organisations. Activities in cities such as London, New York and Berlin aim to promote chess participation and support local engagement with the sport.
Environment
The Board recognises its responsibility to consider the environmental impact of the Group’s operations. The Group seeks to reduce its environmental footprint through efficient use of digital infrastructure, reducing waste at events and minimising the use of paper by maintaining documentation in electronic form where possible. Further information on climate-related matters is provided in the Climate-Related Financial Disclosures section of this Strategic Report.
Maintaining high standards of business conduct
The Company is incorporated in England and Wales and governed by the Companies Act 2006. Following its admission to the Main Market of the London Stock Exchange on 6 April 2023, the Company adopted the Quoted Companies Alliance Corporate Governance Code as updated in 2023 (the “QCA Code”). The Board recognises the importance of maintaining high standards of corporate governance and compliance with the requirements of a Transition Category listing to ensure that the interests of shareholders and other stakeholders are safeguarded.
The Company maintains policies and procedures designed to ensure high standards of ethical behaviour across the organisation. Anti-corruption and anti-bribery training is mandatory for all staff and contractors, and the Company operates a zero-tolerance policy towards bribery and unethical conduct. The Company’s anti-bribery policy is included within the Employee Manual. The Group is committed to providing a safe working environment and operates a whistleblowing policy that allows employees to raise concerns confidentially. Strong financial controls and governance procedures are maintained across the Group, with key business risks reviewed by the Audit Committee, which reports regularly to the Board.
Conclusion
The Directors believe that, during the year, they have acted in the way they consider most likely to promote the success of the Company for the benefit of its members as a whole, as required under Section 172(1) of the Companies Act 2006.
This Strategic Report was approved by the Board on 20 April 2026 and signed on its behalf by:
Ilya Merenzon
Chief Executive Officer
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Corporate Governance Statement
As Interim Chairman, I work with my fellow Board members to ensure that the Company maintains strong standards of corporate governance and that the Board operates effectively in the interests of the Company and its stakeholders.
World Chess PLC has a Transition Category listing on the Main Market of the London Stock Exchange. While this status subjects the Company to ongoing obligations under the Financial Conduct Authority’s rules, it does not require compliance with the UK Corporate Governance Code. Nevertheless, the Board recognises the importance of maintaining robust governance structures and processes to support the Company’s long-term success. Accordingly, the Company has voluntarily adopted the Quoted Companies Alliance (QCA) Corporate Governance Code, as updated 2023, and seeks to apply its ten principles in full, to the extent considered appropriate given the size, structure, and stage of development of the business.
The principles of the QCA Code, as updated in 2023, and the Company’s approach to each of them, are set out in the table on pages 20 to 27. Where the Company has chosen to depart from any provisions of the Code, the Board has provided a clear explanation of the reasons for doing so. The Board continues to monitor its governance framework to ensure it remains fit for purpose. This includes regular assessment of Board composition, diversity, and effectiveness, as well as oversight of key committees and risk management processes.
This Corporate Governance Statement was approved by the Board on 20 April 2026 and signed on its behalf by:
Neil Rafferty
Interim Chairman
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QCA Code – Application of the Ten Principles of Corporate Governance
Although not required to follow a specific corporate governance code due to its Transition Category listing, the Board of World Chess PLC has voluntarily adopted the QCA Code as the framework for its governance practices. The table below outlines each of the QCA Code’s ten principles and sets out how the Company applies them in practice.Where there are areas of partial compliance or alternative approaches, these are explained in the relevant sections.
Deliver Growth
| QCA Code Principle | Application | What we do and why |
|---|---|---|
| 1. Establish a strategy and business model which promote long-term value for shareholders | The Board must be able to express a shared view of the Company’s purpose, business model and strategy. It should go beyond describing products and corporate structures and explain how the Company intends to deliver shareholder value over the medium to long term. | The Group’s purpose, business model and strategy are described in the Strategic Report on page 4. The Board’s strategy is focused on developing the World Chess Online Arena and related digital products. Principal risks are described on page 12 and climate-related risks on pages 13-17. Internal control systems are used to identify and manage risks supporting the delivery of the Group’s long-term strategy. |
| 2. Seek to understand and meet shareholder needs and expectations | Directors must develop a good understanding of the needs and expectations of all elements of the Company’s shareholder base. The Board must manage shareholders’ expectations and should seek to understand the motivations behind shareholder voting decisions. | The Board recognises the importance of maintaining open and transparent communication with shareholders, within the regulatory framework applicable to a listed company. The Company communicates with shareholders primarily through regulatory announcements, the annual report and accounts, and information made available on the Company’s investor relations website. The Company is committed to engaging with its shareholders to ensure that its strategy, business model and performance are clearly understood. The Chief Executive Officer, and where appropriate the Chief Financial Officer and Chair, seek to engage with the Group’s major shareholders on a regular basis and ensure that shareholder views are communicated to the Board. During the year, feedback from shareholders and other stakeholders informed the Group’s increased focus on mobile product development, platform functionality and broader digital growth initiatives. The Board recognises the Annual General Meeting (AGM) as an important opportunity to engage directly with shareholders, particularly private investors. Directors are available to listen to the views of shareholders and to respond to questions regarding the Company’s activities. Where shareholder voting outcomes differ from the Board’s recommendations or expectations, the Board will seek to understand the reasons for those voting decisions and, where appropriate, engage with shareholders to address any concerns. The Chair, Chief Executive Officer and Chief Financial Officer act as the primary contacts for investor relations matters. In responding to shareholder enquiries, the Company ensures that any information provided is publicly available and consistent with market disclosure obligations. |
| 3. Take into account wider stakeholder and social responsibilities and their implications for long-term success | Long-term success relies upon good relations with a range of different stakeholder groups both internal (workforce) and external (suppliers, customers, regulators and others). The Board needs to identify the Company’s stakeholders and understand their needs, interests and expectations. Where matters that relate to the Company’s impact on society, the communities within which it operates or the environment have the potential to affect the Company’s ability to deliver shareholder value over the medium to long-term, those matters must be integrated into the Company’s strategy and business model. Feedback is an essential part of effective control mechanisms and systems should be in place to solicit, consider and act on feedback from stakeholder groups. | The Company recognises the importance of maintaining strong relationships with its key stakeholders and ensuring that their interests are considered in the development of the Group’s strategy and business model. The Board and senior management identify key stakeholders through their ongoing involvement in the operations of the business and through regular engagement with stakeholders. The Company’s principal stakeholders include employees, subscribers of the World Chess Online Arena, sponsors, commercial partners, suppliers and investors. Engagement with these groups enables the Company to better understand stakeholder expectations and supports effective decision-making. The Company maintains a number of channels for stakeholder engagement, including: • representing the Company at industry events and conferences; • internal communications to ensure employees understand performance and strategic objectives; • regular operational meetings and strategic planning sessions; • engagement with sponsors and commercial partners; and • monitoring feedback from subscribers through the Online Arena. The Company also maintains dialogue with strategic investors who have supported the Group’s recent development and growth initiatives. These investors bring relevant experience in digital platforms and mobile application development and provide insight that supports the Board’s strategic thinking as the Company continues to develop the World Chess Online Arena. |
| 4. Embed effective risk management, throughout the organisation considering both opportunities and threats | The Board needs to ensure that the Company’s risk management framework identifies and addresses all relevant risks in order to execute and deliver strategy; companies need to consider their extended business, including the Company’s supply chain, from key suppliers to end-customer. Setting strategy includes determining the extent of exposure to the identified risks that the Company is able to bear and willing to take (risk tolerance and risk appetite). | The Board recognises that effective risk management is essential to delivering the Group’s strategy and protecting long-term shareholder value. The principal risks and uncertainties facing the Group are described in the Strategic Report on pages 12-13. The Company uses internal control systems to identify risks and implement appropriate measures to monitor, manage and mitigate those risks. Risk management is embedded within the governance framework of the Group. The Board considers risks to the business at each Board meeting, with at least ten meetings planned each year. In addition, the Company formally reviews and documents the principal risks to the business at least annually. Both the Board and senior management are responsible for reviewing and evaluating risks and ensuring that appropriate mitigation strategies are in place. Audit, risk and internal financial controls The Company has established a framework of internal financial controls, the effectiveness of which is regularly reviewed by executive management and the Audit Committee in light of ongoing assessments of significant risks facing the business. The Audit Committee assists the Board in discharging its responsibilities relating to financial reporting, accounting policies and the maintenance of effective operational, business and financial controls. The Audit Committee meets at least twice a year with the Company’s external auditor to review the audit process and discuss any matters relating to internal control weaknesses, potential fraud risks or financial reporting issues identified during the audit. The Board is responsible for reviewing and approving the Company’s overall strategy and associated budgets and plans. A structured budgeting and planning process is in place, supported by regular monitoring of performance against budgets and updated forecasts during the financial year. The Board has ultimate responsibility for the Group’s system of internal control and for reviewing its effectiveness. However, any such system can provide only reasonable, and not absolute, assurance against material misstatement or loss. The Group continues to review and enhance its internal control systems to ensure they remain appropriate for the size, complexity and risk profile of the business. |
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Maintain A Dynamic Management Framework
| QCA Code Principle | Application | What we do and why |
|---|---|---|
| 5. Maintain the board as a well-functioning, balanced team led by the chair | Board members have a collective responsibility and legal obligation to promote the interests of the Company and are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the Chair of the Board. The Board and any committees should receive high quality information in a timely manner to facilitate proper assessment of matters requiring decision or oversight. The Board should maintain an appropriate balance between executive and non-executive directors and should include at least two independent non-executive directors, with independence determined by the Board. The Board should also be supported by committees, such as audit, remuneration and nomination committees, with the appropriate skills and knowledge to discharge their duties effectively. Directors must commit sufficient time to fulfil their roles and responsibilities. | The Company is governed by the Board of Directors. The Non-Executive Chair is responsible for the leadership and effective operation of the Board, while the Chief Executive Officer has executive responsibility for managing the Group’s business and implementing the Group’s strategy. All Directors receive regular and timely information regarding the Group’s operational and financial performance. |
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| QCA Code Principle | Application | What we do and why |
|---|---|---|
| 6. Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities | The Board must have an appropriate balance of sector, financial and public markets skills and experience, as well as an appropriate balance of personal qualities and capabilities. The Board should consider diversity, including gender balance, as part of its composition. The Board should not be dominated by one person or group, and should remain capable of independent and objective decision-making. As companies evolve, the mix of skills and experience required on the Board will change and board composition should evolve accordingly. | Details of each Director, including a summary of their experience and background, are provided on pages 29 to 30. The Board collectively possesses a broad range of relevant skills and experience, including expertise in financial management, capital markets, fundraising, mergers and acquisitions, and the management and development of growing businesses. The Board believes that this combination of skills and experience enables it to effectively oversee the Company’s strategy and operations. The Directors bring perspectives from a variety of professional backgrounds, supporting constructive discussion and independent decision-making. Following the resignation of Graham Woolfman as Chairman on 14 February 2025, the Board has commenced a search for a new Non-Executive Director and Chair. The Board believes that appointing an individual with additional experience in digital platforms and sports development would further strengthen the Board’s capabilities as the Company continues to develop the World Chess Online Arena. Any appointment will be made on merit, against objective criteria, and with due regard to maintaining an appropriate balance of skills, experience and diversity on the Board, including gender and ethnic diversity. |
| QCA Code Principle | Application | What we do and why |
|---|---|---|
| 7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvement | The Board should regularly review the effectiveness of its performance as a unit, as well as that of its committees and individual directors. Board performance reviews may be carried out internally or, from time to time, with the assistance of an external facilitator. The review process should identify development or mentoring needs of individual directors or the wider senior management team. Periodic refreshment of the Board is important and succession planning is a key responsibility of the Board. | The Board undertakes periodic evaluations of its effectiveness and performance, including consideration of the performance of its committees and individual Directors. A formal evaluation of the Board’s operation and performance was undertaken in December 2024, with input from an external facilitator, to ensure that the Board continues to operate effectively and that Directors remain independent and committed to their roles. The review considered Board composition, the effectiveness of meetings, the quality of information provided to Directors and the effectiveness of the Board’s committees. The evaluation process helps identify opportunities for improvement and supports the continued development of the Board and senior management team. The Board keeps its composition under review and has commenced a process to recruit a new Non-Executive Chair with experience relevant to the Company’s strategic focus on digital platforms and sports media. In accordance with the Company’s Articles of Association, Directors are subject to periodic re-election by shareholders and stand for re-election at the Annual General Meeting at least every three years. |
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| QCA Code Principle | Application | What we do and why |
|---|---|---|
| 8. Promote a corporate culture that is based on ethical values and behaviours | The Board should embody and promote a corporate culture that is based on sound ethical values and behaviours and use it as an asset and a source of competitive advantage. The policy set by the board should be visible in the actions and decisions of the chief executive and the rest of the management team. Corporate values should guide the objectives and strategy of the Company. The culture should be visible in every aspect of the business, including recruitment, nominations, training and engagement. The performance and reward system should endorse the desired ethical behaviours across all levels of the Company. The corporate culture should be recognisable throughout the disclosures in the annual report, website and any other statements issued by the Company. | The Board seeks to promote a culture based on integrity, transparency and responsible business conduct, and aims to lead by example in acting in the best interests of the Company and its stakeholders. These values underpin the Company’s strategy and day-to-day operations. The Company has adopted a Code of Conduct which sets out the Board’s expectations in relation to ethical behaviour, social responsibility, sustainability, respect for human rights and professional standards for employees and contractors. The Company seeks to conduct its business with honesty and integrity, while respecting the interests of employees, partners, subscribers and other stakeholders. The Board recognises that a strong corporate culture, based on integrity, transparency and fair play, is critical to the long-term success of the Group. Ethical standards are particularly important in the context of the Company’s online chess platform, where principles of fair play, transparency and trust underpin the integrity of the user experience and the reputation of the platform. The Company therefore promotes high standards of conduct across its digital products and events. The Company has also adopted a share dealing code for Directors and relevant employees to ensure compliance with the retained EU law version of the Market Abuse Regulation (MAR). This helps ensure that trading in the Company’s securities is conducted in accordance with applicable legal and regulatory requirements. |
| QCA Code Principle | Application | What we do and why |
|---|---|---|
| 9. Maintain governance structures and processes that are fit for purpose and support good decision-making by the Board | The Company should maintain governance structures and processes that are appropriate to its size, complexity and risk profile. These structures should support effective decision-making by the Board and should evolve over time in line with the Company’s strategy, business model and stage of development. | The Board meets regularly during the year, at least six times, either in person or via electronic means, with additional meetings convened as required. Directors receive timely and relevant information in advance of meetings, supported by formal agendas and Board papers circulated several days beforehand to facilitate informed decision-making. Directors are encouraged to challenge proposals and decisions are taken following discussion and consideration by the Board. The Board is responsible for the long-term success and strategic direction of the Company. A formal schedule of matters reserved to the Board is in place and includes responsibility for approving strategy, reviewing budgets, monitoring financial performance and overseeing the Group’s exposure to key business risks. There is a clear division of responsibilities at the head of the Company: the Chair leads the Board and ensures appropriate strategic focus, while the Chief Executive Officer is responsible for proposing strategy and overseeing the execution of the Group’s operations through the executive management team. The Board is supported by the Audit Committee and the Remuneration Committee. Senior executives below Board level may attend Board meetings where appropriate to present updates and contribute to discussions. |
World Chess Plc – Company Registration No. 10589323 GOVERNANCE Page 26 of 87The Audit Committee meets at least three times a year and is responsible for reviewing the half-yearly and annual financial statements, overseeing the effectiveness of the internal control environment and maintaining communication with the external auditor. The Committee also reviews the independence of the external auditor and considers matters identified during the audit process. The Remuneration Committee meets at least twice a year and makes recommendations to the Board regarding the remuneration of Executive Directors to ensure that compensation appropriately reflects their responsibilities and performance. Given the size and composition of the Board, the responsibilities typically undertaken by a Nomination Committee are currently performed by the Remuneration Committee, following a Board decision in November 2024. The Board keeps its governance structures under review and is committed to evolving its governance arrangements over time in line with the Company’s development and in accordance with the QCA Corporate Governance Code, as updated in 2023.
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Build Trust
QCA Code Principle Application
10. Communicate how the Company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders.
What we do and why
A healthy dialogue should exist between the Board and all of its stakeholders, including shareholders, to enable informed decisions about the Company. Appropriate communication structures should exist between the Board and all elements of the shareholder base to support the communication of shareholder views to the Board and to help shareholders understand the Company’s circumstances, strategy and performance. It should be clear where these communication practices are described, whether in the annual report or on the Company’s website.
The Company maintains regular communication with shareholders and the wider investment community through a number of channels. These include the Annual Report and Accounts, regulatory announcements, including full-year and half-year results, the Annual General Meeting, and engagement with investors through meetings and presentations where appropriate. The Board recognises the importance of maintaining an open dialogue with both institutional and retail shareholders. The Company may hold meetings with existing and potential investors and participate in investor presentations to help ensure that the Company’s strategy, business model and performance are clearly understood.
A range of corporate information, including regulatory announcements, financial reports and investor presentations, is available on the Company’s website at www.worldchess.com. The Company’s Annual Report and Accounts and Notices of General Meetings are published on the website in the investor relations section. The results of voting on all resolutions at general meetings are announced via RNS and made available on the Company’s website.
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Board of Directors
Board composition
The Board currently comprises three Executive Directors, the Interim Non-Executive Chair and one further Non-Executive Director. The Board recognises the current vacancy for a permanent Non-Executive Chair and has commenced a search for a candidate with experience in the digital and sports development sectors, which will complement the Board’s existing blend of industry, financial and public markets experience.
The Board considers that it has an appropriate balance of skills and experience, including digital platform development, chess and sports industry expertise, financial management and public markets experience, which supports the delivery of the Group’s strategy. The Audit Committee and Remuneration Committee are comprised solely of Non-Executive Directors. The role of the Nomination Committee is currently performed by the Remuneration Committee. The Board considers this arrangement appropriate given the current size and composition of the Board. When separately constituted, the Nomination Committee will also comprise Non-Executive Directors.
Board changes during the period
Graham Woolfman stepped down as Non-Executive Chairman on 14 February 2025. Following his resignation, Neil Rafferty, a Non-Executive Director, was appointed Interim Chairman. On 12 February 2026, the Company announced that Neil Rafferty had resigned as Interim Chairman and Director and will step down from the Board effective 11 May 2026, or earlier if a successor is appointed. The Board has commenced a process to recruit a new Non-Executive Chair with experience relevant to the Company’s strategic focus on digital platforms and sports media.
Role of the Board
The Board is collectively responsible for the long-term success of the Group. It provides entrepreneurial leadership within a framework of effective controls that enables risk to be assessed and managed. The Board determines the Group’s strategy and ensures that the necessary financial and operational resources are in place to achieve the Company’s strategic objectives. It reviews management performance and monitors the financial position and business performance of the Group. The Board also oversees the Group’s risk management and internal control framework, including the Company’s approach to compliance, corporate governance and ethical conduct.
The Board is responsible for establishing and maintaining the Group’s risk management and internal control systems. These systems are designed to manage rather than eliminate risk and can therefore only provide reasonable, not absolute, assurance against material misstatement or loss. The Board has reviewed the effectiveness of the Group’s internal control framework during the year and considers it appropriate for the size, complexity and stage of development of the business.
During the year, the Board undertook an internal evaluation of its effectiveness and that of its Committees. The review considered Board composition, information flows and decision-making processes and concluded that the Board operates effectively. The review also identified the continued strengthening of non-executive representation and the appointment of a permanent Chair as priorities.
Non-Executive Directors are expected to devote at least two days per month to their duties, while Executive Directors devote such time as is necessary for the proper performance of their responsibilities.
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Board Committees
Audit Committee
During the year, the Audit Committee comprised Graham Woolfman, Jamison Reed Firestone and Neil Rafferty (Chair). Graham Woolfman stepped down from the Committee following his resignation as Non-Executive Chairman on 14 February 2025. The Committee is responsible for monitoring the integrity of the Company’s financial statements, reviewing the effectiveness of the Group’s internal control and risk management systems, and overseeing the relationship with the external auditor. The Committee reviews reports from the Company’s auditors relating to accounting and internal controls and makes recommendations to the Board regarding the appointment and remuneration of the external auditor. The Audit Committee meets at least twice each year.
Remuneration Committee
During the year, the Remuneration Committee comprised Graham Woolfman (Chair), Jamison Reed Firestone and Neil Rafferty. Graham Woolfman stepped down from the Committee following his resignation as Non-Executive Chairman on 14 February 2025, and Neil Rafferty was appointed as Chair of the Committee therafter on an interim basis. The Remuneration Committee is responsible for reviewing and recommending the remuneration framework for senior management, including Executive Directors, and for determining bonus arrangements and share option awards where applicable. The Committee seeks to ensure that remuneration arrangements support the long-term success of the Company and align the interests of management with those of shareholders. The Remuneration Committee meets as and when required. The responsibilities typically undertaken by a Nomination Committee are currently performed by the Remuneration Committee, following a Board decision in November 2024.
Executive Directors
Ilya Merenzon - Chief Executive Officer
Ilya holds an MPhil in Economics and an MBA and has extensive experience in communications, finance and public markets advisory. Prior to founding World Chess, he worked in the New York Mayor’s Office and later led a communications and government relations practice in New York, advising clients including the New York Stock Exchange and The New York Times. He has also advised on several IPOs, including the listing of Rostelecom.
Matvey Shekhovtsov - Chief Operating Officer
Matvey holds a Master’s degree in International Economic Law from the Moscow State Institute of International Relations and a Master I degree in European and French Economic Law from Paris 1 Panthéon-Sorbonne University. He joined the World Chess project in 2014 and oversees the Company’s day-to-day operations with a focus on compliance, corporate governance and finance.
Richard Collett - Chief Financial Officer
Richard is a member of the Chartered Institute of Management Accountants (CIMA) and a non-practising barrister. He holds a degree in Economics from the University of Leeds and a Postgraduate Diploma in Law from City Law School, City University of London. He has nearly 20 years’ experience in senior finance roles across listed and private companies, including as Chief Financial Officer of Live Company Group PLC.
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Non-Executive Directors
Jamison Reed Firestone - Non-Executive Director
Jamison is a graduate of Tulane Law School and a member of the New York Bar.He founded the first independent foreign law firm in Russia and has extensive experience advising businesses on legal and governance matters. He previously served on the Board of the American Chamber of Commerce in Russia.
Neil Rafferty - Non-Executive Director and Interim Chair (until May 2026)
Neil has held senior executive roles in the telecommunications and technology sectors, including as CEO of Easynet PLC, Priority Telecom, and UCS, a pan-European network carrier. He previously held senior roles at Cisco Systems and has also served as a Non-Executive Director of Ethernity Networks Ltd, an AIM-quoted company.
Market Abuse Regulation
The Company has adopted a share dealing policy which sets out the requirements and procedures for Directors and applicable employees dealing in the Company’s ordinary shares in accordance with the UK Market Abuse Regulation (MAR) as implemented under the European Union (Withdrawal) Act 2018.
| Meeting Attendance | Board | Audit Committee | Remuneration Committee |
|---|---|---|---|
| Ilya Merenzon | 20 | n/a | n/a |
| Matvey Shekhovtsov | 20 | n/a | n/a |
| Jamison Firestone | 20 | 3 | n/a |
| Graham Woolfman – resigned 14 February 2025 | 1 | n/a | n/a |
| Richard Collett | 20 | 3 | n/a |
| Neil Rafferty | 20 | 3 | n/a |
Richard Collett attends the Audit Committee meetings by invitation.
During the year ended 31 December 2025 the Board met 20 times, including scheduled and ad-hoc meetings held to consider strategic, operational and financing matters. The Audit Committee met three times, and the Remuneration Committee did not meet during the year. Given the size of the Board matters typically considered by the Remuneration Committee were addressed by the full Board. (2024: the Board met thirteen times, the Audit Committee met twice, and the Remuneration Committee met once).
Directors’ Interest in Shares
The interest of Directors and their connected persons in shares of the Company were:
| 31 December 2025 | 31 December 2024 | |
|---|---|---|
| Ilya Merenzon | 363,012,818 | 404,520,000 |
| Matvey Shekhovtsov | 33,350,000 | 33,350,000 |
| Jamison Firestone | 5,560,000 | 5,560,000 |
| Graham Woolfman – resigned 14 February 2025 | - | - |
| Richard Collett | 5,319 | 5,319 |
| Neil Rafferty | - | - |
By an agreement dated 28 April 2023, Graham Woolfman was granted an option over 6,669,055 Ordinary Shares exercisable between 6 April 2024 and 6 April 2029 at a price of €0.07 (seven euro cents) per share. These options lapsed unexercised.
By an agreement dated 28 April 2023 Neil Rafferty was granted an option over 1,667,264 Ordinary Shares exercisable between 6 April 2024 and 6 April 2029 at a price of €0.07 (seven euro cents) per share.
The Company does not have an annual or long-term incentive scheme in place, except for the issue of share options as detailed above, for any of the Directors and as such there are no disclosures in this respect.
World Chess Plc – Company Registration No. 10589323 GOVERNANCE Page 31 of 87
| Term of Appointment | Year of appointment | Number of years completed | Date of current engagement letter |
|---|---|---|---|
| Ilya Merenzon | 2017 | 9 | 6 April 2023 |
| Matvey Shekhovtsov | 2017 | 9 | 6 April 2023 |
| Jamison Firestone | 2020 | 5 | 6 April 2023 |
| Graham Woolfman – resigned 14 February 2025 | 2023 | 1 | 6 April 2023 |
| Richard Collett | 2023 | 2 | 6 April 2023 |
| Neil Rafferty | 2023 | 2 | 6 April 2023 |
Board Diversity
| Sex | Number of Board members | Percentage of the Board | Number of senior positions on the Board (CEO, CFO, SID and Chair) |
|---|---|---|---|
| Men | 5 | 100% | 3 |
| Women | - | - | - |
| Not specified/prefer not to say | - | - | - |
| Ethnic background | Number of Board members | Percentage of the Board | Number of senior positions on the Board (CEO, CFO, SID and Chair) |
|---|---|---|---|
| White British or other White (including minority-white groups) | 5 | 100% | 3 |
| Mixed/Multiple Ethnic Groups | - | - | - |
| Asian/Asian British | - | - | - |
| Black/African/Caribbean/Black British | - | - | - |
| Other ethnic group, including Arab | - | - | - |
| Not specified/ prefer not to say | - | - | - |
The data used in the above disclosures has been collected through self-identification by the Directors and reflects the position as at 31 December 2025. The Directors are the only key management personnel of the Company and the Company has no employees other than its Directors; accordingly, no further analysis by sex is presented.
The Board confirms that, as at 31 December 2025, the Company has not met the FCA Listing Rule targets for board diversity, as it did not have at least 40% female representation on the Board, did not have a woman in one of the senior Board positions (Chair, Chief Executive Officer, Senior Independent Director or Chief Financial Officer), and did not have a director from a minority ethnic background. The Board recognises the limitations of its current composition and will have due regard to the benefits of diversity, including sex and ethnic background, when considering future Board appointments.
Board Development
The Directors receive regular updates on legal, regulatory and corporate governance developments from the Group’s financial advisers, Company Secretary, external auditor and other professional advisers to ensure that the Board remains informed of relevant changes affecting the Company and its governance framework.
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Directors are encouraged to maintain and develop their knowledge and skills. This is achieved through a combination of formal continuing professional development where appropriate, participation in professional bodies and industry forums, and ongoing engagement with advisers and relevant market developments.
Audit Committee Report
Since the IPO in 2023 the Board established an Audit Committee with formally approved Terms of Reference, to support the Board in its oversight of the Company’s financial reporting, internal control framework, and risk management systems, and to safeguard the integrity and transparency of the Company’s financial disclosures.
Overview of Activities
During the year, the Audit Committee discharged its responsibilities by reviewing the Company’s financial reporting processes, and compliance with applicable legal and regulatory requirements.
Oversight of Financial Reporting
The Committee has reviewed the Company’s financial statements and recommended them to the Board for approval, having satisfied itself that they are fair, balanced, and understandable and provide the information necessary for shareholders to assess the Company’s performance, business model, and strategy. In doing so, the Committee:
* Considered compliance with UK-adopted International Accounting Standards, and the relevant provisions of the Companies Act 2006.
* Reviewed significant accounting policies, estimates, and judgements. The Committee paid particular attention to significant financial reporting matters, including revenue recognition, the assessment of going concern and the accounting for discontinued operations relating to the closure of the Berlin club. The Committee reviewed management’s assumptions, supporting evidence and judgements in these areas and discussed them with the external auditor, and was satisfied that they were appropriate.
External Audit
The Committee assessed the independence, objectivity, qualifications, and performance of the external auditor, Moore Kingston Smith LLP, and remains satisfied with their effectiveness. The Committee noted that this is the fourth year of Moore Kingston Smith LLP’s tenure. While the Company does not currently have a formal auditor rotation policy, the Committee continues to keep auditor independence and effectiveness under review. The Committee also:
* Reviewed and approved the external audit plan, including scope, materiality, and key audit risks.
* Monitored the progress and outcomes of the audit.
* Discussed findings with the external auditors, including any significant issues arising.
* Ensured appropriate communication between the auditors and the Board.
Internal Controls and Risk Management
The Committee reviewed the effectiveness of the Company’s internal control and risk management systems and is satisfied that these systems are appropriate to the size and complexity of the business. The Company does not currently have a formal internal audit function. The Committee considers that, given the size and stage of development of the business, existing financial and operational controls provide appropriate assurance. The need for an internal audit function is kept under periodic review.
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Approval
This Audit Committee Report was approved by the Audit Committee on 20 April 2026 and signed on its behalf by:
Neil Rafferty
Chair of the Audit Committee
World Chess Plc – Company Registration No. 10589323 GOVERNANCE Page 34 of 87
Directors’ Remuneration Report
The Board recognises the importance of attracting, retaining and motivating talented individuals within both the Board and the wider management team in order to support the long-term success of the Company. The Remuneration Committee is responsible for reviewing and recommending the remuneration arrangements for Directors and senior management. This includes considering the structure of remuneration packages, reviewing performance-related remuneration and ensuring that remuneration policies are aligned with the long-term interests of shareholders.
The Company has not received any specific feedback from shareholders in respect of Directors’ remuneration during the year. Where appropriate, the Board will take into account shareholder views in the formulation and implementation of the Directors’ remuneration policy.
The Company has no employees other than its Directors; however, the Group employs staff across its subsidiary undertakings. While no formal consultation has been undertaken at the Company level, the Board has had regard to pay and employment conditions across the Group when developing the Directors’ remuneration policy.The Company’s Remuneration Policy was approved by shareholders at the Annual General Meeting held on 25 June 2025, with 99.99% of votes cast in favour, 0.01% against (representing 1,500 shares). The Remuneration Committee did not meet during the year ended 31 December 2025. Given the size of the Board and the absence of material changes to remuneration arrangements during the year, matters typically considered by the Remuneration Committee were addressed by the full Board where appropriate. No Director participates in decisions relating to their own remuneration.
Policy table for Executive Directors
| Purpose and link to strategy | Operation | Opportunity & Performance Conditions |
|---|---|---|
| Basic Salary: Attract, retain, and reward high calibre directors and managers. | Salary levels (and subsequent increases) are set after reviewing various factors including individual and Company performance, role and responsibility, internal relativities such as the increases awarded to other employees and prevailing market levels at companies of comparable status and market value, considering the total remuneration package. Salaries are normally reviewed annually, however there is no guarantee of an increase following such review. | While there is no maximum salary level or maximum increase that may be offered, salary increases will normally be in line with typical increases awarded to other employees in the Group. There are no specific performance criteria, although performance of both the Company and the individual are taken into account when determining an appropriate level of base salary (or subsequent increase). |
| Benefits: Attract, retain, and reward high calibre directors and managers. | Benefits, which are on similar terms to those offered to the wider workforce or required to remain market competitive, generally include private medical cover and life assurance cover. Overseas recruitment or an international assignment may require the benefits package to be more tailored and may include, for example, relocation costs, as necessary. | There is no prescribed maximum limit. However, the Committee monitors annually the overall cost of the benefits provided. |
| Pension: Attract, retain and reward high calibre directors and managers. | Defined contribution pension benefits reflect relevant market practice and are determined by the automatic enrolment laws under the Pensions Act 2008 and a potential separate private pension plan arranged by the Company. | There is no prescribed maximum limit. However, the Committee monitors annually the overall cost of the benefits provided. |
| Bonus: Rewards both short and long-term performance. Bonus arrangements encourage and reward the delivery of business objectives. | Bonus payments are discretionary and conditional upon the director or manager meeting in full or in part specific conditions and targets. Bonus may be based on a mix of financial, operational, strategic, and individual performance measures. The exact metrics are determined each year depending on the key goals for the forthcoming year and the annual bonus is normally paid in cash. | There is no prescribed maximum limit. However, the Committee monitors annually the overall cost of the benefits provided. |
| Shareholding: Aligns interests of directors and managers with shareholders. | The Company intends to adopt an incentive plan under which it may award new Ordinary Shares to directors, employees and consultants pursuant to share option and incentive schemes approved by the Board. It is intended that any individual awards under any such scheme will be subject to vesting and/or performance conditions. | Ordinary Shares under such plans will not exceed three percent of the Company’s issued Ordinary Shares from time to time without the prior approval of Shareholders. The Chief Executive Officer, Ilya Merenzon, and Chief Operating Officer, Matvey Shekhovtsov, built up significant shareholdings in the Company prior to listing. |
World Chess Plc – Company Registration No. 10589323 GOVERNANCE Page 36 of 87
The Company has not presented a remuneration scenario chart for executive Directors, as the current remuneration structure does not include material variable or performance-related components.
Policy table for Non-executive Directors
| Purpose and link to strategy | Operation | Opportunity & Performance Conditions |
|---|---|---|
| Fees: Attract, retain, and reward high calibre directors. | Director fees (and subsequent increases) are set after reviewing various factors including individual responsibilities, such as Committee Chairmanship, time commitment, general employee pay increases, and prevailing market levels at companies of comparable status and market value. Fee increases are normally reviewed annually. Non-executive Directors are also reimbursed for reasonable expenses incurred in connection with their duties to the Company. | There is no maximum fee level or maximum increase that may be offered and there are no specific performance criteria. |
| Shareholding: Aligns interests of directors and with shareholders. | The Company considers ownership of Company shares by non-executive directors as a positive alignment of their interest with shareholders. Non-executive directors may therefore be invited to participate in any incentive share plan the Company may adopt. It is intended that any individual awards under any such scheme will be subject to vesting and/or performance conditions. The Company’s Executive Directors will periodically review the shareholdings of the Non-executive Directors and will seek guidance from its advisors if, at any time, it is concerned that the shareholding of any Non-executive Director may, or could appear to, conflict with their duties as an independent non-executive Director. | There is no target shareholding and there are no specific performance criteria, however the Company’s Executive Directors will periodically review the shareholdings of the Non-executive Directors and will seek guidance from its advisors if, at any time, it is concerned that the shareholding of any Non-executive Director may, or could appear to, conflict with their independence. |
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The Company has not presented a total shareholder return performance graph or a ten-year historical remuneration table for the Chief Executive Officer, as it was admitted to trading in 2023 and therefore has a limited trading history. The Board considers that such disclosures would not provide meaningful additional information to shareholders at this stage.
The Company has no employees other than its Directors and has not paid any dividends or undertaken any share buybacks during the year. Accordingly, the Directors do not consider a comparison of relative spend on pay to be meaningful.
Remuneration of Directors 2025 (audited)
| Salary and fees € | Benefits-in-kind € | Pension contributions € | 2025 Total € | |
|---|---|---|---|---|
| Ilya Merenzon | 212,400 | - | - | 212,400 |
| Matvey Shekhovtsov | 116,900 | - | - | 116,900 |
| Jamison Firestone 1 | 37,372 | - | 903 | 38,275 |
| Graham Woolfman 2 | 18,645 | - | - | 18,645 |
| Richard Collett 1 | 116,788 | - | 1,543 | 118,331 |
| Neil Rafferty | 47,972 | - | - | 47,972 |
| 550,077 | - | 2,446 | 552,523 |
1 – Pension contributions for Mr Collett and Mr Firestone are in accordance with the auto enrolment provisions of the Pensions Act 2008
2 – Graham Woolfman resigned 14 February 2025
Changes to Directors’ base salaries or fees during the year are reflected in the table above. In particular, Neil Rafferty’s fees increased following his appointment as Interim Chairman, and Matvey Shekhovtsov’s remuneration returned to its previous level following his return from paternity leave. No compensation for loss of office was paid to or receivable by any Director or past Director during the year (2024: nil).
Remuneration of Directors 2024 (audited)
| Salary and fees € | Benefits-in-kind € | Pension contributions € | 2024 Total € | |
|---|---|---|---|---|
| Ilya Merenzon | 212,400 | - | - | 212,400 |
| Matvey Shekhovtsov | 96,200 | - | - | 96,200 |
| Jamison Firestone 1 | 37,847 | - | 773 | 38,620 |
| Graham Woolfman | 50,706 | - | - | 50,706 |
| Richard Collett 1 | 118,264 | - | 1,561 | 119,825 |
| Neil Rafferty | 37,899 | - | - | 37,899 |
| 553,316 | - | 2,334 | 555,650 |
1 – Pension contributions for Mr Collett and Mr Firestone are in accordance with the auto enrolment provisions of the Pensions Act 2008
In 2025 and 2024 all remuneration was fixed.
Policy on payment for loss of office
Executive Directors’ service agreements include provisions relating to notice periods and payments in lieu of notice. The circumstances surrounding any termination of employment will be considered on a case-by-case basis, with the Board seeking to ensure that any payments are consistent with contractual obligations and the best interests of the Company and its shareholders. Service agreements may be terminated without notice or payment in lieu of notice in cases of gross misconduct. The Company may require an Executive Director to continue working during their notice period or may place them on garden leave, particularly where the individual has access to commercially sensitive information. The Remuneration Committee retains discretion to approve appropriate payments in connection with the cessation of employment where necessary to fulfil contractual obligations or to settle potential claims arising from the termination of employment.
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Such payments may include contractual notice payments, reasonable relocation costs, tax equalisation costs where applicable, outplacement support and reasonable legal or professional advisory fees incurred in connection with the cessation of office. No payments for loss of office were made during the year. A payment in lieu of notice of €12,409 was made to a former Director in accordance with the terms of their service agreement and is included within remuneration.Service agreements and Letters of Appointment Executive Directors have service agreements with the Company, while Non-Executive Directors are appointed under letters of appointment. Copies of these agreements are available for inspection at the Company’s registered office. Executive Directors’ service agreements are typically terminable on six months’ notice, except for the Chief Financial Officer whose agreement is terminable on three months’ notice. The agreements include customary confidentiality and post-employment restrictive covenants. Non-Executive Directors are appointed under letters of appointment which are terminable on three months’ notice by either party. Details of current Directors’ agreements are summarised below.
Executive Directors
| Director | Position | Date of agreement | Notice period |
|---|---|---|---|
| Ilya Merenzon | Chief Executive Officer | 6 April 2023 (amended 30 June 2025) | 6 months |
| Matvey Shekhovtsov | Chief Operating Officer | 6 April 2023 (amended 27 June 2025) | 6 months |
| Richard Collett | Chief Financial Officer | 6 April 2023 | 3 months |
Ilya Merenzon and Matvey Shekhovtsov also have German employment agreements dated 1 March 2022 in respect of duties undertaken for World Chess Europe GmbH, which were amended in June 2025 (effective 1 July 2025) to reflect a reallocation of remuneration between World Chess PLC and World Chess Europe GmbH, with no change to total remuneration.
Non-Executive Directors
| Director | Date of agreement | Notice period |
|---|---|---|
| Jamison Reed Firestone | 6 April 2023 | 3 months |
| Neil Rafferty | 6 April 2023 | 3 months |
Neil Rafferty was appointed Interim Chairman on 14 February 2025. Graham Woolfman resigned as Non-Executive Chairman and Director on 14 February 2025.
Material Interests
So far as the Board is aware, no director had any material interest in a contract of significance (other than their service contract) with the Company or any of its subsidiary companies during the year. This Remuneration Report was approved by the Remuneration Committee on 20 April 2026 and signed on its behalf by: Neil Rafferty Chair of the Remuneration Committee World Chess Plc – Company Registration No. 10589323 GOVERNANCE Page 39 of 87
Directors’ Report
The Directors present their Annual Report and the audited Group and Company financial statements of World Chess PLC for the year ended 31 December 2025. In accordance with section 414c (11) of the Companies Act 2006, the Directors have chosen to include information about the future developments, principal risks and uncertainties and relationships with employees, customers and suppliers in the Strategic Report.
Principal Activities
The Company is the holding company of a group which aims to promote the mass market appeal of chess globally through the commercial offering of different chess-related activities, including the organisation of top-level tournaments, operation of the official online gaming platform of FIDE and other sport, lifestyle and social activities, and merchandise related to chess.
Directors
The Directors who served during the period, and up to the date of this report, except where stated, were as follows:
• Ilya Merenzon
• Matvey Shekhovtsov
• Jamison Reed Firestone
• Graham Woolfman (resigned 14 February 2025)
• Richard Collett
• Neil Rafferty
Dividends
The Directors do not propose a dividend in respect of the year ended 31 December 2025 (2024: €nil).
Political donations
The Company did not make any political donations or expenditure in the year (2024: €nil).
Directors' and officers’ indemnity insurance
During the year, Directors’ and officers’ liability insurance was maintained for Directors and other officers of the Company as permitted by the Companies Act 2006.
Financial risk management
The Group’s financial risk management objectives are detailed in note 22.
Subsequent Events
Events occurring after the reporting period have been detailed in the Strategic Report and in note 30.
Current Director Shareholdings
The interests of the Directors in the share capital of the Company, including those of their connected persons, are set out below and reflect their interests as at the date of this report:
| No. of shares at 20 April 2026 | % | |
|---|---|---|
| Ilya Merenzon | 371,812,818 | 34.12 |
| Matvey Shekhovtsov | 33,350,000 | 3.06 |
| Jamison Firestone | 5,560,000 | 0.51 |
| Richard Collett | 5,319 | 0.00 |
| Neil Rafferty | - | - |
By an agreement dated 28 April 2023 Neil Rafferty was granted an option over 1,667,264 Ordinary Shares exercisable between 6 April 2024 and 6 April 2029 at a price of €0.07 (seven euro cents) per share. The Company does not have an annual or long-term incentive scheme in place other than the share options World Chess Plc – Company Registration No. 10589323 GOVERNANCE Page 40 of 87 described above for certain Directors and, as such, no further disclosures are required in this respect.
Substantial Shareholdings
The Directors were advised of the following significant direct and indirect interests in the issued share capital of the Company above 3% as at 20 April 2026:
| No. of shares | % | |
|---|---|---|
| Ilya Merenzon | 371,812,818 | 34.12 |
| Valery Kurylau | 145,131,934 | 13.32 |
| Dmitri Lipnitsky | 145,131,934 | 13.32 |
| Prytek Investment Holdings Pte Ltd | 83,910,000 | 7.70 |
| Yuri Milner 1 | 50,455,671 | 4.61 |
| Andrey Insarov 2 | 61,907,662 | 5.68 |
| Matvey Shekhovtsov | 33,350,000 | 3.06 |
1 – Yuri Milner’s interest includes ordinary shares held by Breakthrough Initiatives Ltd, Steinitz Investments Ltd, and Euler Fund L.P., entities over which he exerts significant influence.
2 – Andrey Insarov’s interest includes ordinary shares held by Intis Telecom Limited an entity over which he exerts significant control.
Controlling Shareholder
Ilya Merenzon, who is the Chief Executive Officer of the Group, holds 33.31% of the total issued share capital of the Company. A relationship agreement dated 6 April 2023 between Mr Merenzon, the Company and Novum Securities Limited (‘Novum’) pursuant to which Mr Merenzon has agreed with the Company and Novum that for such time as he and his affiliates own or control interests in Ordinary Shares comprising not less than 25% of the Company’s issued Ordinary Shares from time to time, he will not exercise and will procure that his affiliates will not exercise, his voting rights to influence the Directors or to change the Company’s articles of association to result in his position and those of his affiliates being preferred or promoted ahead of those of other shareholders, and to exercise (or to refrain from exercising, as the case may be) such voting rights so as to ensure that the Company is managed and conducted independently from him and such affiliates acting as majority shareholder on the operational level. Aside from as stated above, to the best of the Directors’ knowledge no-one, directly or indirectly, acting jointly, exercises or could exercise control over the Company.
Going Concern
The Directors have assessed the Group’s ability to continue as a going concern as described in note 2 on page 62. Based on the Group’s current financial position and a review of forecast operating budgets and cash flow projections, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for at least twelve months from the date of approval of these financial statements. The forecasts assume no additional external funding beyond the post-year-end investment of approximately €1,359,000, as described in note 30 – subsequent events, and reflect expected growth in revenues from the World Chess Online Arena together with continued cost management. However, the timing and extent of revenue growth from the Online Arena remain subject to execution risk. While the Directors continue to seek additional investment to support further development of the platform and provide additional headroom should revenue growth be slower than forecast, there can be no certainty that such funding will be secured. These conditions indicate the existence of a material uncertainty which may cast significant doubt on the Group’s ability to continue as a going concern. World Chess Plc – Company Registration No. 10589323 GOVERNANCE Page 41 of 87
Streamlined Energy and Carbon Reporting (SECR)
Scope of the Report
This disclosure covers the reporting period from 1 January 2025 to 31 December 2025 and includes carbon and energy data for World Chess PLC’s consolidated operations. During the year, the Group ceased operations at its Berlin club venue as part of a broader strategic transition toward a digital-first operating model. As a result, the Group no longer operates a dedicated physical venue and now conducts its activities primarily through digital platforms, serviced offices and remote working arrangements. This change has materially altered the Group’s emissions profile, with a reduced reliance on physical infrastructure and a corresponding shift toward indirect emissions. The majority of emissions therefore arise from Scope 2 (indirect energy consumption) and Scope 3 (other indirect emissions). The Group does not report Scope 1 emissions as it does not own or operate any facilities that result in direct emissions. The following scope categories have been included in the report:
• Scope 2: Electricity use from metered premises, based on consumption data where available.
• Scope 3: Business travel, employee commuting and purchased goods and services. Scope 3 emissions are calculated using the EXIOBASE Multi-Regional Environmentally Extended Input-Output (EEIO) Model to estimate emissions from procurement and travel activity. A location-based approach has been used to calculate Scope 2 emissions, reflecting the average grid emissions in the country of operation (primarily Germany for the period in which the Berlin club venue was operational).
Methodology
Emissions are calculated using the GHG Protocol methodology and apply the latest government conversion factors. For Scope 3 procurement emissions, expenditure data is mapped to EEIO emission factors to provide a reliable estimate of upstream environmental impacts.### Energy Efficiency Measures
During 2025, the Group continued to focus on operational efficiency and reduced environmental impact through:
• Consolidation of in-person business travel through digital alternatives (virtual meetings);
• Introduction of procurement guidelines that favour low-emission vendors and services; and
• Ongoing optimisation of its operating model to prioritise digital delivery over physical infrastructure.
Emissions Intensity & Targets
| Kilowatt hours of energy (kWh) | Tonnes of carbon dioxide equivalent (tCO2e) | |||
|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | |
| Scope 1 | - | - | - | - |
| Scope 2 Rest of world electricity (location based) | 38,702 | 122,127 | 12.4 | 39.2 |
| Scope 3 Business travel | 52,158 | 28,183 | 11.7 | 6.3 |
| Scope 3 Employee commuting | 143,584 | 124,094 | 32.3 | 27.9 |
| Scope 3 Purchased goods and services | 2,441,891 | 2,727,446 | 549.4 | 613.7 |
| Total | 2,676,335 | 3,001,850 | 605.8 | 687.1 |
| Intensity ratio per €m revenue | 1,183,122 | 1,233,211 | 268 | 282 |
World Chess Plc – Company Registration No. 10589323 GOVERNANCE Page 42 of 87
The Group is committed to improving its emissions intensity on a per-revenue basis. Its near-term goals are:
• Achieve a 10% reduction in emissions intensity (tCO₂e per €m revenue) by 31 December 2026, using 2024 as the baseline year; this target has not been formally amended, however, following the closure of the Berlin venue and the Group’s transition to a predominantly digital model, the Directors consider the target to be of reduced strategic significance and it is under review;
• Transition to 100% renewable electricity in all remaining office locations by 2027;
• Reduce carbon intensity per digital user by 30% by 2030 (baseline year: 2024); and
• Include Scope 3 supplier engagement in its climate strategy by 2027. This timeline has been revised from 2025 to reflect changes in the Group’s supplier base following the transition to a more digitally focused operating model.
In 2025, total emissions reduced across several categories. Scope 2 electricity consumption decreased from 122,127 kWh in 2024 to 38,702 kWh in 2025, reflecting the reduced footprint of physical operations following the cessation of the Berlin venue. Purchased goods and services emissions also declined year-on-year, consistent with a lower level of physical procurement and a shift toward a more asset-light model. Business travel emissions increased compared to 2024, reflecting a partial normalisation of activity levels following the unusually low travel levels in the prior year. However, the Group has increasingly prioritised lower-emission travel options, with rail usage for European travel increasing from 5% of business kilometres travelled in 2024 to 17% in 2025. This shift away from air travel has helped mitigate the carbon impact of increased travel activity, alongside continued use of virtual collaboration tools to limit unnecessary journeys. Employee commuting emissions increased modestly, reflecting a broader return to hybrid working patterns. Overall, total emissions decreased from 687.1 tCO₂e in 2024 to 605.8 tCO₂e in 2025. This reduction primarily reflects the structural change in the Group’s operating model rather than discrete energy efficiency initiatives.
Looking ahead, the Group will continue to refine its data collection processes and is developing a more detailed climate transition plan aligned with the UK’s TCFD and SDR frameworks, reflecting its repositioning as a predominantly digital business.
Equal opportunities
The Company promotes a policy for the creation of equal and ethnically diverse employment opportunities including with respect to gender. The Company promotes and encourages employee involvement wherever practical as it recognises employees as an asset and one of the key contributions to the Company’s success.
Internal controls
The Board has ultimate responsibility for the Group’s system of internal controls and for reviewing their effectiveness. However, any such system of internal control can provide only reasonable, but not absolute, assurance against material misstatement or loss. The Group continues to review its system of internal controls to ensure they are appropriate for the size, complexity and risk profile of the Group. The risk and control management system framework includes:
• close management of the day-to-day activities of the Group by the Executive Directors;
• regular reviews of its risk register;
• comprehensive annual budgeting process, which is approved by the Board;
• detailed monthly reporting of performance against budget; and
• central control over key areas such as capital expenditure authorisation and banking facilities.
The Executive Directors are responsible for ensuring that the risk and control management system framework is implemented effectively within their respective business areas. This includes ensuring an effective risk culture is in place, with risk management embedded in the business. The Board delegates its
World Chess Plc – Company Registration No. 10589323 GOVERNANCE Page 43 of 87
responsibility to identify, assess and manage climate-related risk to the Audit Committee. The Group continues to review its system of internal control to ensure adherence to best practice, whilst also having regard to its size and the resources available. A whistleblowing policy is in place to enable employees to report to the Board, in confidence, any risks or threats to the operations of the business, however the Board considers that the introduction of an internal audit function is not appropriate at this juncture but will keep this under review.
Corporate Governance
The Company has adopted the Quoted Companies Alliance Corporate Governance Code, as updated 2023 (the "QCA Code") as its benchmark for governance practices, having regard to the Company's size, stage of development and resources. The Board believes the QCA Code provides an appropriate framework to support effective corporate governance and long-term value creation for shareholders. A detailed statement of how the Company has applied each of the ten principles of the QCA Code, as updated 2023,, including an explanation of any departures from the Code and the reasons for them, is set out on pages 20 to 27 of this Annual Report.
Provision of information to auditor
So far as each of the Directors is aware at the time this report is approved:
• there is no relevant audit information of which the Company’s auditor is unaware; and
• the Directors have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the Company’s auditor is aware of that information.
Auditor
Moore Kingston Smith LLP were reappointed as auditors for the Company for the financial year 2025 at the AGM in June 2025. A resolution to re-appoint Moore Kingston Smith LLP will be put to the shareholders at the next Annual General Meeting.
Website publication
The Directors are responsible for ensuring the annual report and the financial statements are made available on a website. Financial statements are published on the Company’s website in accordance with legislation in the United Kingdom governing the preparation and dissemination of financial statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the Company’s website is the responsibility of the directors. The Directors’ responsibility also extends to the ongoing integrity of the financial statements contained therein.
Directors’ responsibilities pursuant to DTR4 (Disclosure and Transparency Rules)
The Directors confirm to the best of their knowledge and belief:
• The Group and Company financial statements have been prepared in accordance with UK-adopted International Accounting Standards, and give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group and Company; and
• The annual report includes a fair review of the development and performance of the business and financial position of the Group and Company, together with a description of the principal risks and uncertainties.
The Directors are authorised, subject to shareholder approval, to allot shares and to disapply pre-emption rights in accordance with resolutions passed at the Company’s Annual General Meeting. These authorities are reviewed and renewed annually. The Company does not currently have authority to purchase its own shares.
World Chess Plc – Company Registration No. 10589323 GOVERNANCE Page 44 of 87
The Board confirms that the Company has complied with the provisions of UKLR 6.2.3R throughout the year and continues to be able to carry on its business independently of its controlling shareholder. This Directors’ Report was approved by the Board of Directors on 20 April 2026 and signed on its behalf by:
Ilya Merenzon
Chief Executive Officer
World Chess Plc – Company Registration No. 10589323 GOVERNANCE Page 45 of 87
Statement of Directors’ Responsibilities
The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations. Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors are required to prepare the Group and Company Financial Statements in accordance with UK- adopted International Accounting Standards and as regards the Company financial statements, as applied in accordance with the requirements of the Companies Act 2006. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group as at the end of the financial year and of the profit or loss of the Group and the Company for that period.In preparing these financial statements, the Directors are required to:
- select suitable accounting policies and then apply them consistently;
- make judgments and accounting estimates that are reasonable and prudent;
- state whether the applicable UK-adopted International Accounting Standards have been followed subject to any material departures disclosed and explained in the financial statements; and
- prepare the financial statements on a going concern basis unless it is inappropriate to presume that the Group and the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group and Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website. Legislation in the United Kingdom governing the preparation and dissemination of the financial statements may differ from legislation in other jurisdictions.
This Report was approved by the Board of Directors on 20 April 2026 and signed on its behalf by:
Ilya Merenzon
Chief Executive Officer
World Chess Plc – Company Registration No. 10589323
REPORT TO THE MEMBERS OF WORLD CHESS PLC
Page 46 of 87
Opinion
We have audited the financial statements of World Chess Plc (the ‘parent company’) and its subsidiaries (the ‘group’) for the year ended 31 December 2025 which comprise the Consolidated Statement of Profit or Loss and Other Comprehensive Income, the Consolidated and Company Statements of Financial Position, the Consolidated and Company Statements of Changes in Equity, the Consolidated and Company Statements of Cash Flows and notes to the financial statements, including significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and UK adopted International Accounting Standards and, as regards the parent company financial statements, as applied in accordance with the provisions of the Companies Act 2006.
In our opinion:
* the financial statements give a true and fair view of the state of the group’s and of the parent company’s affairs as at 31 December 2025 and of the group’s loss for the year then ended;
* the group financial statements have been properly prepared in accordance with UK adopted International Accounting Standards;
* the parent company financial statements have been properly prepared in accordance with UK adopted International Accounting Standards and as applied in accordance with the provisions of the Companies Act 2006; and
* the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the audit of the financial statements section of our report. We are independent of the group and the parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard 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.
Our approach to the audit
Our audit approach was a risk-based approach founded on a thorough understanding of the group’s business, its environment and risk profile. We conducted substantive audit procedures and evaluated the group’s internal control environment. We also addressed the risk of management override of internal controls, including assessing whether there was evidence of bias by the directors that may have represented a risk of material misstatement.
Our group audit focused on the financial information of components which, in our view, either individually or in combination, represented the most significant areas of financial reporting risk or were quantitatively material to the Group's results. For those components that presented a higher risk of material misstatement or contributed significantly to the overall group’s results or financial position, either a full scope or a specified audit approach was determined based on their relative materiality to the group and our assessment of the audit risk.
For components requiring a full scope approach, we evaluated controls by performing walkthroughs over the financial reporting systems identified as part of our risk assessment, reviewed the accounts production process and addressed critical accounting matters. We then undertook substantive testing on significant transactions and material account balances.
In order to address the audit risks in respect of the group and company financial statements identified during our planning procedures, we performed a full scope audit of the financial statements of the parent company. For the purpose of expressing our opinion on the group financial statements, we also performed a full scope audit of the financial information of World Chess Events Limited and World Chess Europe GmbH.
World Chess Plc – Company Registration No. 10589323
REPORT TO THE MEMBERS OF WORLD CHESS PLC
Page 47 of 87
We performed analytical procedures on the remaining components, which were individually immaterial but collectively covered residual group risk. All work was carried out by the group audit engagement team. We communicated with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant findings, including any significant deficiencies in internal controls that we identified during the audit.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the group and 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 audit engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. This is not a complete list of risks identified during our audit.
| Key Audit Matters | How our scope addressed this matter |
|---|---|
| Valuation of intangible assets Refer to note 2 on page 66 for the relevant accounting policies and page 63 for the key judgements taken by management in preparing the consolidated financial statements. As at the reporting date, the group had intangible assets of €3.03m (2024: €3.48m). Management and those charged with governance are required to assess whether there are potential indicators of impairment of the group’s intangible assets at each reporting date and, if potential indicators of impairment are identified, management are required to perform a full impairment test of the recoverable value of the intangible assets in accordance with the requirements of IAS 36. Management identified potential indicators of impairment of the intangible assets and consequently performed an impairment test, based on which they concluded that no impairment was ultimately required. The assessment of the recoverable value of the intangible assets required judgements and estimates to be made by management regarding the inputs applied in the models including future cash flows, operating and development costs and discount rates. The carrying value of the intangible assets was therefore considered to be a key audit matter. |
Our audit work included, but was not restricted to, the following procedures: • Critically assessing the appropriateness of management’s determination of the relevant Cash Generating Units (CGUs). • Obtaining management’s assessment of the future forecast discounted cash flows and critically assessing the Value In Use (VIU) model for intangible assets to test compliance with the requirements of the applicable financial reporting standards, specifically IAS 36. • Performing data integrity and mechanical checks on the discounted cash flow model. • Critically assessing and challenging the impairment test prepared by management including the forecast discounted cash flows, focusing on the appropriateness of the assumptions and key inputs used in preparing them. • Performing sensitivity analysis on the impairment test and assessing the accuracy of the forecasts used based on historical trading performance for the CGUs. • Evaluating the accounting policy and detailed disclosures in the notes to the financial statements to determine whether the information provided in the financial statements is compliant with the requirements of IAS 36 and consistent with the results of the impairment test. • Reviewing the amortisation accounting policy for non-goodwill intangible fixed assets to ensure it was appropriate. |
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• Critically assessing the relevant disclosures within the financial statements.
Key observations: Based on our audit work, we concluded that intangible assets are not materially misstated at the reporting date and that management’s assessment that no impairment was required was appropriate.We consider the disclosures in the financial statements relating to this area to be adequate and in accordance with the requirements of IAS 36.
Valuation of intercompany receivables
Refer to note 2 on page 64 for the relevant accounting policies and pages 63 and 64 for the key judgements taken by management in preparing the consolidated financial statements. As at the reporting date, the Company had intercompany receivables of €7.43m (2024: €4.71m). Management and those charged with governance are required to assess the recoverable amount of the receivables and any expected credit losses in accordance with the requirements of IFRS 9. Management identified potential indicators of impairment relating to certain intercompany receivables and consequently performed an impairment assessment. Based on this assessment, they concluded that no impairment was ultimately required.
The evaluation of the recoverable amount of the intercompany receivables required management to exercise judgement and apply estimates, including assumptions regarding the financial position and forecast cash flows of the counterparties, expected credit losses, and the timing of settlement. The carrying value of the intercompany receivables was therefore considered to be a key audit matter.
Our audit work included, but was not restricted to, the following procedures:
* Obtained an understanding of the processes around intercompany receivables valuation, assessing whether relevant controls identified within the processes were appropriately designed and implemented.
* Obtained management’s calculation of expected credit losses and evaluated the mathematical accuracy of the calculation and whether the methodology applied was in accordance with IFRS 9.
* Performing sensitivity analysis on the impairment test and assessing the accuracy of the forecasts used based on historical trading performance for the CGUs.
* Challenged the key assumptions used within the expected credit loss calculations including the expected value to be recovered in the event of a trade sale.
* Assessed the adequacy of related disclosures within the annual report in compliance with the requirements of IFRS 9.
Key observations:
Based on our audit work, we concluded that intercompany receivables are not materially misstated at the reporting date and that management’s assessment that no impairment was required was appropriate. We consider the disclosures in the financial statements relating to this area to be adequate and in accordance with the requirements of relevant IFRS.
World Chess Plc – Company Registration No. 10589323
REPORT TO THE MEMBERS OF WORLD CHESS PLC
Page 49 of 87
Going concern
Refer to note 2 on page 62 in the consolidated financial statements. The group has incurred a loss of €3.66m for the year (2024: €3.80m) and the net assets disclosed in the Consolidated Statement of Financial Position at 31 December 2025 are €1.55m representing an increase from €0.95m at 31 December 2024. The directors have prepared cashflow forecasts that show that the group will be able to meet its ongoing liabilities as they fall due for at least twelve months from the date of signing of these financial statements. Our audit work and conclusions in respect of going concern have been detailed in the ‘Material uncertainty related to going concern’ section of our audit report.
Our application of materiality
The scope and focus of our audit were influenced by our assessment and application of materiality. We define materiality as the magnitude of misstatement that could reasonably be expected to influence the economic decisions of the users of the financial statements. We use materiality to determine the scope of our audit and the nature, timing, and extent of our audit procedures and to evaluate the effect of misstatements, both individually and on the financial statements as a whole. We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect of misstatements.
Based on our professional judgement we determined materiality for the financial statements as a whole and performance materiality as follows:
| Group financial statements | Parent company financial statements | |
|---|---|---|
| Materiality | €183,000 | €77,000 |
| Basis for determining materiality | 5% of loss before tax | 1% of gross assets |
| Rationale for the benchmark applied | As the group is a profit-oriented group and profit/loss is a key financial indicator of the business performance on which the users of the group financial statements are likely to focus, we considered this to be an appropriate benchmark for group materiality. | As the parent company does not have any trading operations, total assets is the key indicator of the business performance on which the users of the parent company financial statements are likely to focus, we considered this to be an appropriate benchmark for parent company materiality. |
| Performance materiality | €91,500 | €38,500 |
| Basis for determining performance materiality | 50% of group materiality. This was considered an appropriate percentage based on our risk assessment and our assessment of the overall control environment of the group. | 50% of parent company materiality. This was considered an appropriate percentage based on our risk assessment and our assessment of the overall control environment of the parent company. |
Materiality levels for all the other components, we set materiality based on a percentage of group materiality dependent on the size of each component and our assessment of the risk of material misstatement relevant to that component. Component materiality, other than that of the parent company, ranged from €142,000 to €164,700. In the audit of each component, we further applied performance materiality levels of 50% of the
World Chess Plc – Company Registration No. 10589323
REPORT TO THE MEMBERS OF WORLD CHESS PLC
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component materiality to our testing to ensure that the risk of errors exceeding component materiality was appropriately mitigated. We agreed with the Audit Committee that we would report to them all individual audit differences in excess of €9,150 for the group and €3,850 for the parent company. We also agreed to report differences below this threshold that, in our view, warranted reporting on qualitative grounds. We also reported to the Audit Committee on disclosure matters that we identified when assessing the overall presentation of the financial statements.
Material uncertainty related to going concern
We draw attention to note 2 to the financial statements, which indicates that the group is dependent on obtaining potential further funding if the forecasted revenue growth is not achieved, in order to continue in business and meet its liabilities as they fall due for a period of at least twelve months from the date of approval of the financial statements. Whilst the group has secured funding of €1.39m subsequent to the year end, this is not sufficient to cover the future liabilities and working capital requirements set out in management’s forecasts. Management is evaluating additional funding options and consequently the need to secure this future funding represents a material uncertainty that may cast significant doubt on the Group’s ability to continue as a going concern.
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors’ assessment of the group’s and the parent company’s ability to continue to adopt the going concern basis of accounting included, but was not limited to, the following procedures:
* Critically assessing the going concern assessment prepared by management covering at least twelve months from the date of approval of the financial statements and challenging the client as regards the key assumptions and forecasts used in their assessment;
* Performing sensitivity analysis on the forecasts to ensure there is sufficient cash flow headroom for the group to continue as a going concern for at least that period;
* Reviewing the terms of the facilities available to the group;
* Reviewing the trading performance of the group post year end and comparing it to the forecasts to assess their accuracy; and
* Assessing the adequacy of the going concern disclosures in the financial statements.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
The 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.
In connection with our audit of the financial statements, 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 there is 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.
World Chess Plc – Company Registration No.10589323 REPORT TO THE MEMBERS OF WORLD CHESS PLC Page 51 of 87
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.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report. We have nothing to report in respect of the following matters where 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; or
- a corporate governance statement has not been prepared by the parent company.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set out on page 45, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the group’s and the parent company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.
Auditor’s Responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities is available on the FRC’s website at https://www.frc.org.uk/auditors/auditor-assurance/auditor-s-responsibilities-for-the-audit-of-the-fi/description-of-the-auditor's-responsibilities-for
This description forms part of our auditor’s report.
World Chess Plc – Company Registration No. 10589323 REPORT TO THE MEMBERS OF WORLD CHESS PLC Page 52 of 87
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company.
Our approach was as follows:
- We obtained an understanding of the legal and regulatory requirements applicable to the group and parent company and considered that the most significant are the Companies Act 2006, UK adopted International Accounting Standards, the Listing Rules, the Disclosure and Transparency Rules, and UK taxation legislation.
- We obtained an understanding of how the group and parent company complies with these requirements by discussions with management and those charged with governance.
- We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance.
- We inquired of management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations.
- Based on this understanding, we designed specific appropriate audit procedures to identify instances of non-compliance with laws and regulations. This included making enquiries of management and those charged with governance and obtaining additional corroborative evidence as required.
- We evaluated managements’ incentives to fraudulently manipulate the financial statements and determined that the principal risks related to management bias in accounting estimates and judgemental areas of the financial statements. We challenged the assumptions and judgements made by management in respect of the significant areas of estimation, as described in the key audit matters section. Further audit procedures performed to address the risk of fraud included but were not limited to the testing of journals and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
Other matters which we are required to address
Following the recommendation of the Audit Committee, we were reappointed at the Company’s Annual General Meeting (AGM) on 25 June 2025 as auditor of the Company to hold office until the conclusion of the next AGM of the Company. We were originally appointed by the Audit Committee on 6 March 2023 to audit the financial statements for the year ended 31 December 2022. Our total uninterrupted period of engagement is four years, covering periods from our appointment to the year ended 31 December 2025.
World Chess Plc – Company Registration No. 10589323 REPORT TO THE MEMBERS OF WORLD CHESS PLC Page 53 of 87
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.
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 for no purpose other than to draw to the attention of the company’s members those matters which we are required to include in an auditor’s report addressed to them. To the fullest extent permitted by law, we do not accept or assume responsibility to any party other than the company and company’s members as a body, for our work, for this report, or for the opinions we have formed.
20 April 2026
Matthew Banton (Senior Statutory Auditor)
for and on behalf of Moore Kingston Smith LLP, Statutory Auditor
6th Floor
9 Appold Street
London EC2A 2AP
World Chess Plc – Company Registration No. 10589323 FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 Page 54 of 87
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2025
| Notes | 2025 (€) | 2024 (€) | |
|---|---|---|---|
| Revenue | 3 | 2,029,433 | 1,820,801 |
| Cost of sales | (1,419,901) | (1,331,799) | |
| GROSS PROFIT | 609,532 | 489,002 | |
| Administrative expenses | (3,274,230) | (3,289,653) | |
| OPERATING LOSS | (2,664,698) | (2,800,651) | |
| Finance costs | 5 | (21,856) | (22,367) |
| Finance income | 5 | 1,212 | 139 |
| Loss before income tax – continuing operations | 6 | (2,685,342) | (2,822,879) |
| Income tax – continuing operations | 7 | (192) | (217) |
| Loss for the year – continuing operations | (2,685,534) | (2,823,096) | |
| Loss for the year – discontinued operations (net of tax) | 8 | (974,407) | (972,050) |
| LOSS FOR THE YEAR | (3,659,941) | (3,795,146) | |
| OTHER COMPREHENSIVE INCOME | |||
| (Loss)/gain on currency translation | (25,763) | 12,753 | |
| TOTAL COMPREHENSIVE INCOME FOR THE YEAR | (3,685,704) | (3,782,393) | |
| Loss attributable to: | |||
| Owners of the parent | (3,659,941) | (3,795,146) | |
| Total comprehensive income attributable to: | |||
| Owners of the parent | (3,685,704) | (3,782,393) | |
| Loss per share | |||
| Basic and diluted: | |||
| Continuing operations | (0.003) | (0.004) | |
| Discontinued operations | (0.002) | (0.002) | |
| Total | 9 | (0.005) |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2025
| Notes | 2025 € | 2024 € | |
|---|---|---|---|
| NON-CURRENT ASSETS | |||
| Owned: Intangible assets | 10 | 3,030,080 | 3,477,150 |
| Owned: Property, plant and equipment | 11 | 8,675 | 935,240 |
| Right-of-use: Property, plant and equipment | 11, 21 | - | 1,055,967 |
| Trade and other receivables | 14 | - | 162,884 |
| Deferred tax | 25 | - | 111,374 |
| 3,038,755 | 5,742,615 | ||
| CURRENT ASSETS | |||
| Inventories | 13 | 129,512 | 147,549 |
| Trade and other receivables | 14 | 137,563 | 234,167 |
| Tax receivable | 9,667 | 64,734 | |
| Cash and cash equivalents | 15 | 40,732 | 267,396 |
| 317,474 | 713,846 | ||
| TOTAL ASSETS | 3,356,229 | 6,456,461 | |
| EQUITY AND LIABILITIES | |||
| SHAREHOLDERS' EQUITY | |||
| Called up share capital | 16 | 100,495 | 78,520 |
| Share premium | 17 | 17,925,396 | 12,754,046 |
| Share capital to be issued | 18 | 1,016,703 | 2,016,703 |
| Translation reserve | 18 | 45,608 | 71,371 |
| Retained earnings | 18 | (17,629,811) | (13,969,870) |
| TOTAL EQUITY | 1,458,391 | 950,770 | |
| NON-CURRENT LIABILITIES | |||
| Lease liabilities | 21 | - | 1,174,319 |
| Provision for liabilities | 24 | 2,000 | 157,887 |
| 2,000 | 1,332,206 | ||
| CURRENT LIABILITIES | |||
| Trade and other payables | 19 | 1,895,838 | 2,641,987 |
| Lease liabilities | 21 | - | 129,955 |
| Interest bearing loans and borrowings | 20 | - | 1,401,543 |
| 1,895,838 | 4,173,485 | ||
| TOTAL LIABILITIES | 1,897,838 | 5,505,691 | |
| TOTAL EQUITY AND LIABILITIES | 3,356,229 | 6,456,461 |
The notes on pages 62 to 88 should be read in conjunction with these consolidated financial statements. The financial statements were approved by the Board of Directors and authorised for issue on 20 April 2026 and were signed on its behalf by: Ilya Merenzon Chief Executive Officer World Chess Plc – Company Registration No. 10589323 FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 Page 56 of 87
COMPANY STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2025
| Notes | 2025 € | 2024 € | |
|---|---|---|---|
| NON-CURRENT ASSETS | |||
| Trade and other receivables | 14 | 7,425,069 | - |
| Investments | 12 | 1,616 | 301,616 |
| 7,426,685 | 301,616 | ||
| CURRENT ASSETS | |||
| Trade and other receivables | 14 | 7,044 | 4,732,815 |
| Tax receivable | 963 | 16,712 | |
| Cash and cash equivalents | 15 | 5,524 | 6,551 |
| 13,531 | 4,756,078 | ||
| TOTAL ASSETS | 7,440,216 | 5,057,694 | |
| EQUITY AND LIABILITIES | |||
| SHAREHOLDERS' EQUITY | |||
| Called up share capital | 16 | 100,495 | 78,520 |
| Share premium | 17 | 17,925,396 | 12,754,046 |
| Share capital to be issued | 18 | 1,016,703 | 2,016,703 |
| Retained earnings | 18 | (11,964,755) | (10,422,057) |
| TOTAL EQUITY | 7,077,839 | 4,427,212 | |
| CURRENT LIABILITIES | |||
| Trade and other payables | 19 | 362,377 | 630,482 |
| 362,377 | 630,482 | ||
| TOTAL LIABILITIES | 362,377 | 630,482 | |
| TOTAL EQUITY AND LIABILITIES | 7,440,216 | 5,057,694 |
The notes on pages 62 to 88 should be read in conjunction with these consolidated financial statements. As permitted by Section 408 of the Companies Act 2006, the statement of Profit and loss and comprehensive income of the parent company is not presented as part of these financial statements. The parent company's loss for the financial year was €1,542,698 (2024: €3,550,193). The financial statements were approved by the Board of Directors and authorised for issue on 20 April 2026 and were signed on its behalf by: Ilya Merenzon Chief Executive Officer World Chess Plc – Company Registration No. 10589323 FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 Page 57 of 87
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2025
| Called up share capital € | Share Premium € | Share capital to be issued € | Translation reserve € | Retained Earnings € | Total equity € | |
|---|---|---|---|---|---|---|
| Balance at 1 January 2024 | 75,647 | 11,048,183 | 1,508,737 | 58,618 | (10,174,724) | 2,516,461 |
| Changes in equity | ||||||
| Issue of share capital | 336 | 199,664 | - | - | - | 200,000 |
| Movement in share capital to be issued | 2,537 | 1,506,199 | 507,966 | - | - | 2,016,702 |
| Total comprehensive income | - | - | - | 12,753 | (3,795,146) | (3,782,393) |
| Balance at 31 December 2024 | 78,520 | 12,754,046 | 2,016,703 | 71,371 | (13,969,870) | 950,770 |
| Changes in equity | ||||||
| Issue of share capital | 20,528 | 3,972,797 | - | - | - | 3,993,325 |
| Movement in share capital to be issued | 1,447 | 1,198,553 | (1,000,000) | - | - | 200,000 |
| Total comprehensive income | - | - | - | (25,763) | (3,659,941) | (3,685,704) |
| Balance at 31 December 2025 | 100,495 | 17,925,396 | 1,016,703 | 45,608 | (17,629,811) | 1,458,391 |
The notes on pages 62 to 88 should be read in conjunction with these consolidated financial statements.
COMPANY STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2025
| Called up share capital € | Share Premium € | Share capital to be issued € | Retained Earnings € | Total equity € | |
|---|---|---|---|---|---|
| Balance at 1 January 2024 | 75,647 | 11,048,183 | 1,508,737 | (6,871,864) | 5,760,703 |
| Changes in equity | |||||
| Issue of share capital | 336 | 199,664 | - | - | 200,000 |
| Movement in share capital to be issued | 2,537 | 1,506,199 | 507,966 | - | 2,016,702 |
| Total comprehensive income | - | - | - | (3,550,193) | (3,550,193) |
| Balance at 31 December 2024 | 78,520 | 12,754,046 | 2,016,703 | (10,422,057) | 4,427,212 |
| Changes in equity | |||||
| Issue of share capital | 20,528 | 3,972,797 | - | - | 3,993,325 |
| Movement in share capital to be issued | 1,447 | 1,198,553 | (1,000,000) | - | 200,000 |
| Total comprehensive income | - | - | - | (1,542,698) | (1,542,698) |
| Balance at 31 December 2025 | 100,495 | 17,925,396 | 1,016,703 | (11,964,755) | 7,077,839 |
The notes on pages 62 to 88 should be read in conjunction with these consolidated financial statements. World Chess Plc – Company Registration No. 10589323 FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 Page 58 of 87
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2025
| Notes | 2025 € | 2024 € | |
|---|---|---|---|
| Cash flows from operating activities | |||
| Cash absorbed from operations | 1 | (2,475,581) | (2,149,377) |
| Interest paid on borrowings | (22,834) | (34,657) | |
| Lease interest paid | (48,350) | (151,200) | |
| Tax refund received | 54,875 | (20,985) | |
| Net cash used in operating activities | (2,491,890) | (2,356,219) | |
| Cash flows from investing activities | |||
| Purchase of intangible fixed assets | (3,901,396) | (6,473,527) | |
| Proceeds from disposal of intangible fixed assets | 3,698,854 | 5,503,318 | |
| Purchase of property, plant and equipment | (2,671) | (39,315) | |
| Proceeds from disposal of property, plant and equipment | 40,872 | - | |
| Interest received | 1,212 | 139 | |
| Net cash used in investing activities | (163,129) | (1,009,385) | |
| Cash flows from financing activities | |||
| Loan advanced in the year | 2,764,577 | 2,279,714 | |
| Loan repayments in year | (3,512,544) | (912,628) | |
| Payment of lease liabilities | (41,148) | (116,207) | |
| Amount (withdrawn)/introduced by directors | (263,339) | 165,785 | |
| Proceeds from share issue | 3,306,572 | - | |
| Received in advance of share issuance | 200,000 | 2,016,702 | |
| Net cash generated from financing activities | 2,454,118 | 3,433,366 | |
| (Decrease)/increase in cash and cash equivalents | (200,901) | 67,762 | |
| Cash and cash equivalents at beginning of year | 2 | 267,396 | 186,881 |
| Effect of foreign exchange rate changes | (25,763) | 12,753 | |
| Cash and cash equivalents at end of year | 2 | 40,732 | 267,396 |
During the year, €653,576 of convertible loan notes were converted into equity. This transaction did not result in a cash flow and has therefore been excluded from the statement of cash flows. The notes on pages 60 to 61 and on pages 62 to 88 should be read in conjunction with these consolidated financial statements. World Chess Plc – Company Registration No. 10589323 FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 Page 59 of 87
COMPANY STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2025
| Notes | 2025 € | 2024 € | |
|---|---|---|---|
| Cash flows from operating activities | |||
| Cash absorbed by operations | 1 | (794,795) | (881,937) |
| Interest paid on borrowings | (1,367) | (6,241) | |
| Net cash used in operating activities | (796,162) | (888,178) | |
| Cash flows from investing activities | |||
| Interest received | 119,113 | 112,675 | |
| Net cash generated from investing activities | 119,113 | 112,675 | |
| Cash flows from financing activities | |||
| Loan advanced in the year | 653,576 | - | |
| Amounts paid to group undertakings | (3,434,495) | (1,430,427) | |
| Amounts introduced by directors | (49,631) | 174,413 | |
| Proceeds from share issue | 3,306,572 | - | |
| Received in advance of share issuance | 200,000 | 2,016,702 | |
| Net cash generated from financing activities | 676,022 | 760,688 | |
| Decrease in cash and cash equivalents | (1,027) | (14,815) | |
| Cash and cash equivalents at beginning of year | 2 | 6,551 | 21,366 |
| Cash and cash equivalents at end of year | 2 | 5,524 | 6,551 |
During the year, €653,576 of convertible loan notes were converted into equity. This transaction did not result in a cash flow and has therefore been excluded from the statement of cash flows. The notes on pages 60 to 61 and on pages 62 to 88 should be read in conjunction with these financial statements.
NOTES TO THE STATEMENTS OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2025
1 RECONCILIATION OF LOSS FOR THE YEAR TO CASH ABSORBED FROM OPERATIONS
| Group | 2025 € | 2024 € |
|---|---|---|
| Loss for the year | (3,659,941) | (3,795,146) |
| Income tax | 111,566 | (47,885) |
| Depreciation and amortisation | 839,423 | 864,330 |
| Reversal of provision | (155,887) | - |
| Impairment of non-current assets (note 8) | 1,754,520 | - |
| Gain on derecognition of lease liability (note 8) | (1,263,126) | - |
| Finance costs | 71,184 | 187,325 |
| Finance income | (1,212) | (139) |
| (2,303,473) | (2,791,515) | |
| Decrease in inventories | 18,037 | 39,469 |
| Decrease/(increase) in trade and other receivables | 271,909 | (184,553) |
| (Decrease)/increase in trade and other payables | (462,054) | 787,222 |
| Cash absorbed from operations | (2,475,581) | (2,149,377) |
| Company | 2025 € | 2024 € |
|---|---|---|
| Loss for the year | (1,542,698) | (3,550,193) |
| Impairment of intercompany loan | 566,347 | 2,631,441 |
| Impairment of investments in group undertakings | 300,000 | - |
| Finance costs | 1,367 | 6,241 |
| Finance income | (119,113) | (112,675) |
| (794,097) | (1,025,186) | |
| Decrease in trade and other receivables | 12,298 | 887 |
| (Decrease)/increase in trade and other payables | (12,996) | 142,362 |
| Cash absorbed by operations | (794,795) | (881,937) |
The reconciliation above includes a number of non-cash adjustments relating to discontinued operations, including impairment of non-current assets of €1,764,060 and a gain on derecognition of the related lease liability of €1,263,126 as detailed in note 8.At Company level, the reconciliation also includes an impairment of an intercompany loan of €566,347 and an impairment of the investment in World Chess Europe GmbH of €300,000. These items do not give rise to cash movements and have therefore been adjusted in reconciling loss before income tax to net cash outflow from operating activities.
Page 60 of 87 World Chess Plc – Company Registration No. 10589323 FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025
World Chess Plc – Company Registration No. 10589323 FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 Page 61 of 87
2 CASH AND CASH EQUIVALENTS
The amounts disclosed on the Statements of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:
| Group | 2025 (€) | 2024 (€) |
|---|---|---|
| Year ended 31 December 2025 | 40,732 | 267,396 |
| Year ended 31 December 2024 | 267,396 | 186,881 |
| Company | 2025 (€) | 2024 (€) |
|---|---|---|
| Year ended 31 December 2025 | 5,524 | 6,551 |
| Year ended 31 December 2024 | 6,551 | 21,366 |
3 RECONCILIATION OF NET DEBT
| Group | 2025 (€) | 2024 (€) |
|---|---|---|
| At 31 December | ||
| Other loans | - | (1,401,543) |
| Amounts owed to Directors | (49,947) | (300,865) |
| Lease liabilities | - | (1,304,274) |
| Total Borrowings | (49,947) | (3,006,682) |
| Cash and cash equivalents | 40,732 | 267,396 |
| Net debt | (9,215) | (2,739,286) |
| Company | 2025 (€) | 2024 (€) |
|---|---|---|
| At 31 December | ||
| Amounts owed to Directors | (144,691) | (194,322) |
| Cash and cash equivalents | 5,524 | 6,551 |
| Net debt | (139,167) | (187,771) |
Amounts owed to Directors includes balances due to Directors disclosed in note 27 to the financial statements. Although classified under ‘trade and other payables’ in the Statement of Financial Position, these amounts represent short-term financing from Directors and are included in net debt.
World Chess Plc – Company Registration No. 10589323 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2025 Page 62 of 87
1 STATUTORY INFORMATION
World Chess PLC is a public company, limited by shares, registered in England and Wales. The Company's registered number and registered office address can be found on the Company Information page.
2 ACCOUNTING POLICIES
Basis of preparation
These financial statements have been prepared in accordance with UK – adopted International Accounting Standards and IFRIC interpretations and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The financial statements have been prepared under the historical cost convention, except for certain financial assets and liabilities, including crypto assets which are measured at fair value. The Group had discontinued operations during the year relating to the Berlin club (see note 8). The financial statements are presented in Euro which is the functional currency of the Group and rounded to the nearest €.
Going concern
The Group incurred a loss for the year of €3,685,704 (2024: €3,782,393) and, as at 31 December 2025, had net current liabilities of €1,578,364 (2024: €3,459,639). These conditions indicate that the Group remains dependent on the successful execution of its strategy and the availability of funding to meet its obligations as they fall due.
The Directors have assessed the Group’s ability to continue as a going concern for a period of at least twelve months from the date of approval of these financial statements. This assessment has been based on the Group’s current financial position together with a review of forecast operating budgets and cash flow projections. The forecasts reflect the Group’s strategic focus on the continued development of the World Chess Online Arena together with ongoing cost management, including the Group’s agreement with FIDE in respect of the platform, which is due to expire in August 2026 but provides for automatic renewal in accordance with its terms. The forecasts assume no additional external funding beyond the post-year-end investment of approximately €1,359,000, as described in note 30 – subsequent events, and reflect expected growth in revenues from the Online Arena. However, the timing and extent of revenue growth remain subject to execution risk. While the Directors continue to seek additional investment to support further development of the platform and provide additional headroom should revenue growth be slower than forecast, there can be no certainty that such funding will be secured. These conditions indicate the existence of a material uncertainty which may cast significant doubt on the Group’s ability to continue as a going concern. Notwithstanding the above, the financial statements have been prepared on a going concern basis as the Directors have a reasonable expectation that the Group will be able to realise its assets and discharge its liabilities in the normal course of business.
World Chess Plc – Company Registration No. 10589323 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Page 63 of 87
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiaries) made up to 31 December each year. Control is achieved where the Company has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its activities. Intra-group balances and transactions are eliminated on consolidation.
Critical accounting judgements and key sources of estimation uncertainty
The preparation of the financial statements in conformity with UK – adopted International Accounting Standards requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Although these estimates are based on management's best knowledge of the amounts, events or actions, actual results ultimately may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised.
The material areas in which estimates and judgements are applied as follows:
Impairment of other intangible assets
The Group is required to test, on an annual basis, whether other intangible assets have suffered any impairment. Determining whether there has been any impairment requires an estimation of the fair value in use of the cash-generating units. The value in use calculation requires the Directors to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate to calculate the present value, the discount rate applied is 13.29% (2024: 12.81%).
The carrying value of intangible assets (excluding crypto assets) is set out in the table below (see also note 10):
| Group | 2025 (€) | 2024 (€) |
|---|---|---|
| Exclusive FIDE rights | 110,530 | 221,059 |
| Software Licences | 13,000 | 36,000 |
| Online Arena | 2,906,076 | 2,942,925 |
Sensitivity Analysis
The impairment review is sensitive to changes in key assumptions, particularly the discount rate and the forecast revenues and costs The Directors have considered the extent to which these assumptions would need to change for the recoverable amount to equal the carrying value of the cash-generating unit.
- The discount rate would need to increase from 13.29% to approximately 55.37% before the value in use equals the carrying value.
- Forecast revenues would need to decrease by approximately 55% before the value in use equals the carrying value.
- Forecast costs would need to increase by approximately 135% before the value in use equals the carrying value.
The Directors consider these sensitivities to represent severe downside scenarios and, accordingly, conclude that there is significant headroom and no impairment is required.
Investments and amounts owed by group undertakings for impairment (Company Only)
At each reporting date, the Company assesses whether amounts owed by group undertakings and investments in subsidiaries have suffered any impairment. Determining whether there has been any impairment requires an estimation of the recoverable amount of these balances, based on the financial position and expected future cash flows of the relevant group undertakings.
World Chess Plc – Company Registration No. 10589323 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Page 64 of 87
This assessment involves estimating future cash flows expected to arise from the group undertakings and applying a suitable discount rate to calculate the present value. The discount rate applied is 13.29% (2024: 12.81%).
The carrying value of amounts owed by group undertakings is as follows:
| Company | 2025 (€) | 2024 (€) |
|---|---|---|
| World Chess Events Ltd | 6,962,574 | 4,713,473 |
| World Chess USA inc. | 462,495 | - |
The balance due from World Chess USA inc. is supported by its intercompany receivable from World Chess Events Ltd of €581,467 and reflects the role of the entity within the Group’s operating and funding structure rather than its standalone revenue generation. Amounts due to the parent company are classified as non-current as they are not expected to be settled within 12 months of the reporting date. The prior year comparative has not been restated as the classification reflects conditions and expectations at the respective reporting dates.
As at the reporting date, an impairment charge of €566,347 (2024: €2,631,441) has been recognised in the Company’s income statement in respect of amounts owed by World Chess Europe GmbH, reflecting a reassessment of their recoverability.. In addition, during the year the Company recognised an impairment of €300,000 in respect of its investment in World Chess Europe GmbH, reducing the carrying value of the investment to €nil. This impairment reflects the closure of the Berlin club venue during the year and the resulting reassessment of the recoverable amount of the subsidiary.The Directors will continue to monitor the financial performance of the group undertakings and reassess the recoverability of both intercompany balances and investments on an ongoing basis.
Legal proceedings and other provisions
Provisions for legal proceedings are recognised as other expenses when the Group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount can be measured reliably. At the Statement of Financial Position date there is an ongoing claim with one supplier, if the claim is successful then an invoice, amounting to €1,140,000, will become payable. The invoice is not provided for in the financial statements as the Directors consider it to be null and void and raised by the supplier in breach of contract (see note 26).
The Group previously recognised a dilapidations provision of €155,887 at 31 December 2024 in respect of the estimated cost of reinstating a leased property to its original condition at the end of the lease term. During the year, following the closure of the Berlin club venue and termination of the associated lease, the obligation no longer existed and the provision was fully released to the income statement. This release forms part of the net impact of the lease exit and venue closure recognised during the year.
Revenue recognition
Revenue is recognised when control of goods or services is transferred to the customer. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The transaction price represents the amount of consideration to which the Group expects to be entitled in exchange for transferring goods or services to a customer, including any variable consideration which is constrained to amounts for which it is highly probable that a significant reversal will not occur, and any non-cash consideration, including digital assets, which is measured at fair value at contract inception.
World Chess Plc – Company Registration No. 10589323 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Page 65 of 87
The Group applies the practical expedients permitted by IFRS 15 and does not adjust the transaction price for the effects of a significant financing component where the period between transfer of goods or services and payment is one year or less, and recognises incremental costs of obtaining a contract as an expense when incurred where the amortisation period of the related asset would be one year or less.
Revenue received in advance gives rise to contract liabilities, which are deferred and included in accruals and deferred income. The carrying amount of deferred income included in payables is €48,327 (2024: €401,898). These balances arise where consideration is received in advance of performance and are recognised as revenue as the Group satisfies its performance obligations over time or at a point in time, depending on the nature of the contract. No material obligations for returns, refunds or similar provisions have been identified.
The policies specific to the Group’s revenue streams are outlined below:
- Tournaments and World Chess TV: Revenue is recognised in the period in which the event takes place; revenue is typically linked to multiyear agreements where payment is received in advance of the event to which it relates.
- World Chess Online Arena: Revenue is recognised over the period of the subscription; online subscriptions are typically paid annually in advance.
- Merchandising and Clubs: Revenue is recognised when control of the goods has transferred to the customer, typically at the point of sale.
Segment reporting
IFRS 8 Operating Segments requires operating segments to be identified and reported in a manner consistent with the internal reporting provided to the chief operating decision maker (‘CODM’), which has been identified as the Chief Executive Officer, who is responsible for allocating resources and assessing performance of the operating segments as identified by the Directors.
The Directors have reviewed the Group’s activities and consider the Group to comprise a single line of business being a mass market promoter of chess. Within the single line of business, the Group undertakes integrated revenue generating activities across tournaments, an online platform, chessarena.com, and merchandise and clubs. These revenue generating activities are closely aligned within a business model which seeks to promote a chess community across tournaments, online and physical environments. The individual revenue generating activities are managed in an integrated way by the CODM and executive management team who review financial information in the same integrated way. The Group has geographically separate operations and a geographic split of revenue as well as the split between the revenue types within its activities is included in note 3.
Cash and cash equivalents
Cash represents cash in hand and deposits held on demand with financial institutions. Cash equivalents are short-term, highly-liquid investments with original maturities of three months or less (as at their date of acquisition). Cash equivalents are readily convertible to known amounts of cash and subject to an insignificant risk of change in that cash value. In the presentation of the Statement of Cash Flows, cash and cash equivalents also include bank overdrafts. Any such overdrafts are shown within borrowings under ‘current liabilities’ on the Statement of Financial Position.
Crypto-assets
Included within intangible assets are crypto-assets held in the Group’s name in the Binance crypto exchange, the Group has not traded in crypto-assets to date and such activities do not form part of its strategy. The crypto-assets are not held as long-term investments, nor do they form part of the Group’s inventory. The Group’s strategy is to convert crypto-assets to fiat currencies at the earliest opportunity,
World Chess Plc – Company Registration No. 10589323 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Page 66 of 87
usually upon receipt or in accordance with an agreed schedule of conversion. Any crypto-assets received are recognised at the exchange rate prevailing at the date that the risk and reward associated with the crypto-asset passes to the Group. Where the exchange rate of the crypto-assets has a guaranteed minimum floor price, a receivable is recognised for any short-fall. Crypto-assets are not amortised but are reviewed for impairment if the prevailing exchange rate indicates their value has fallen below their carrying value. Any impairment or realised exchange gains on the conversion of crypto-assets to fiat currency are recognised within administrative expenses on the Consolidated Statement of Profit or Loss and Other Comprehensive Income.
Other intangible assets
Amortisation is charged to the income statement on a straight-line basis over the estimated useful lives of intangible assets. Intangible assets are amortised from the date they are available for use. The estimated useful lives are as follows:
- Exclusive rights to organise and host top-level chess events in association with FIDE: amortised using the straight-line method over the ten-year term of the original contract. Following the 2022 FIDE Grand Prix, the rights were varied such that the Company now holds the exclusive right to operate the official gaming platform of FIDE, chessarena.com. This was treated as a disposal of the old rights and an acquisition of the new rights at the same carrying value, with the new rights being amortised over the remaining life of the original contract. The contract is due to expire in August 2026; the agreement provides for automatic renewal for a further five-year period unless FIDE elects to operate the platform itself or accept a bona fide third-party offer that World Chess does not match.
- Capitalised costs associated with developing the online platform used for the FIDE Online Arena: ten years using the straight-line method.
- Licences to operate certain software incorporated into the platform: the life of the contract, being five years using the straight-line method.
The basis for choosing these useful lives is with reference to the years over which they can continue to generate value for the Group. The Group reviews the amortisation period and method whenever events or circumstances indicate that the useful lives of intangible assets may have changed since the last reporting date. The amortisation charge for the year is recognised within Administrative Expenses in the Consolidated Statement of Profit or Loss and Other Comprehensive Income.
The Group assesses at each reporting date whether there is any indication that intangible assets may be impaired. If any such indication exists, the recoverable amount of the asset is estimated. An impairment loss is recognised in the income statement if the carrying amount of an intangible asset exceeds its recoverable amount. The recoverable amount is determined as the higher of fair value less costs of disposal and value in use, based on estimated future cash flows discounted to their present value.
Property, plant and equipment
Depreciation is provided in order to write off each asset over its estimated useful life or, if held as a right-of-use asset, over the lease term, whichever is the shorter, which are typically:
- Fixtures and fittings: Straight line between 1 and 10 years depending on the type of asset
- Computer equipment: Straight line over 3 years
The Group assesses at each reporting date whether there is any indication that property, plant and equipment may be impaired. If such an indication exists, the recoverable amount of the asset is estimated. An impairment loss is recognised if the carrying amount exceeds the recoverable amount, which is determined as the higher of fair value less costs of disposal and value in use.Any impairment losses are recognised in profit or loss. Impairment losses are reviewed at each reporting date for possible reversal.
World Chess Plc – Company Registration No. 10589323
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Page 67 of 87
Financial instruments
The Group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other receivables and payables, loans from banks and other third parties, loans to related parties and investments in non-puttable ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at the present value of the future cash flows and subsequently amortised cost using the effective interest method.
Debt instruments that are payable or receivable within one year, typically trade receivables and payables, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of trade debt deferred beyond normal business terms or financed at a rate of interest that is not market rate or in the case of an outright short-term loan not at market rate, the financial asset or liability is measured, initially, at the present value of the future cash flow discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Consolidated Statement of Profit or Loss and Other Comprehensive Income. For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the reporting date.
Financial assets and liabilities are offset, and the net amount reported in the Statement of Financial Position when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Inventories
Inventories of traded goods are valued at the lower of cost or net realisable value (the estimated selling price less the estimated costs to sell), after making due allowance for obsolete and slow-moving items. Cost is determined using the weighted average cost method. No write-downs of inventories to net realisable value were recognised during the year (2024: nil).
Taxation
Current taxes are based on the results shown in the financial statements and are calculated according to local tax rules in the UK, USA and Germany where the Group operates, using tax rates enacted or substantively enacted by the reporting date. Current tax represents the amount of tax payable or receivable in respect of the taxable profit (or loss) for the current or past reporting periods. It is measured at the amount expected to be paid or recovered using the tax rates and laws that have been enacted or substantively enacted by the reporting date.
Commercial legislation within the Russian Federation in which the Group operated prior to April 2022, including tax legislation, is subject to varying interpretations and frequent changes. The Group's management is confident that all necessary tax accruals have been made and, accordingly, no additional provision is required in the consolidated financial statements.
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date. Deferred tax represents the future tax consequences of transactions and events recognised in the financial
Page 68 of 87
World Chess Plc – Company Registration No. 10589323
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
statements of current and previous periods. It is recognised in respect of all timing differences, with certain exceptions. Timing differences are differences between taxable profits and total comprehensive income as stated in the financial statements that arise from the inclusion of income and expense in tax assessments in periods different from those in which they are recognised in the financial statements.
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.
Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date that are expected to apply to the reversal of timing differences. The Group has applied the temporary exception introduced by the amendments to IAS 12 in respect of the recognition and disclosure of deferred tax assets and liabilities related to Pillar Two income taxes. The Group is not within the scope of Pillar Two income taxes and, accordingly, no such deferred taxes have been recognised.
Research and development
Research and development expenditure is capitalised if it can be demonstrated that:
* it is technically and commercially feasible to develop the asset for future economic benefit;
* adequate resources are available to maintain and complete the development;
* there is the intention to complete and develop the asset for future economic benefit;
* the Group is able to use the asset;
* use of the asset will generate future economic benefit; and
* expenditure on the development of the asset can be measured reliably.
Other development expenditure is recognised in the Consolidated Statement of Profit and Loss as an expense as incurred. Capitalised development expenditure is stated at cost less accumulated amortisation and less accumulated impairment losses.
Foreign currencies
Assets and liabilities in foreign currencies are translated into euro at the rates of exchange ruling at the statement of financial position date. Transactions in foreign currencies are translated into euro at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.
The results and financial position of subsidiaries whose functional currency is not the euro are translated into euro as follows:
* Monetary assets and liabilities are translated at the closing exchange rate at the statement of financial position date.
* Non-monetary items (such as equity investments and property, plant and equipment) are translated at historical exchange rates.
* Income and expenses are translated at the average exchange rate for the period, unless exchange rates fluctuate significantly, in which case the exchange rates at the dates of the transactions are used.
Exchange differences arising from the translation of the financial statements of foreign subsidiaries are recognised in other comprehensive income and accumulated in a separate component of equity, called the foreign currency translation reserve. On disposal of a foreign subsidiary, the cumulative translation differences are reclassified to profit or loss as part of the gain or loss on disposal.
IFRS 16 ‘Leases’
Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. Leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset is available for use by the Group. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a
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World Chess Plc – Company Registration No. 10589323
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
constant periodic rate of interest on the remaining balance of the liability for each period. Where ownership of the right-of-use asset transfers to the lessee at the end of the lease term, the right- of-use asset is depreciated over the asset’s remaining useful life. If ownership of the right-of-use asset does not transfer to the lessee at the end of the lease term, depreciation is charged over the shorter of the useful life of the right-of-use asset and the lease term.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present value of the following lease payments:
* Fixed payments (including in-substance fixed payments), less any lease incentives receivable;
* Amounts expected to be payable by the lessee under residual value guarantees; and
* Payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.
The lease payments are discounted using the interest rate implicit in the lease, if that rate can be determined, or the Group’s incremental borrowing rate.
Right-of-use assets are measured at cost comprising the following:
* The amount of the initial measurement of lease liability;
* Any lease payments made at or before the commencement date less any lease incentives received; and
* Any initial direct costs.### Adoption of new and revised standards
There are a number of standards, amendments to standards, and interpretations which have been issued by the IASB that are effective from 1 January 2025, none of which have a material impact on these financial statements.
Standards issued but not yet effective
At the date of approval of these financial statements, the following new or amended standards and interpretations had been issued by the International Accounting Standards Board (IASB) and endorsed for use in the UK, but were not yet effective for the year ended 31 December 2025. The Group has not early adopted any of these standards:
- IAS 1 (Amendments) – Classification of Liabilities as Current or Non-current (effective date 1 January 2027)
- IAS 7 and IFRS 7 (Amendments) – Supplier Finance Arrangements (effective date 1 January 2027)
- IFRS 10 and IAS 28 (Amendments) – Sale or Contribution of Assets between an Investor and its Associate or Joint Venture (effective date deferred indefinitely)
- IFRS 18 – Presentation and Disclosure in Financial Statements (effective date 1 January 2027)
- IFRS 19 – Subsidiaries without Public Accountability: Disclosures (effective date 1 January 2027)
It is not expected that the amendments listed above, except for IFRS 18, once adopted, will have a material impact on the financial statements.
Financial liabilities
The Group does not have financial liabilities that would be classified as fair value through the profit or loss. Therefore, all financial liabilities are classified as other financial liabilities. The Group uses the amortised cost method for financial liabilities including borrowings, trade and other payables and are recognised at their original amount.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
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3 REVENUE
Revenue from contracts with customers
| Revenue by type | 2025 (€) | 2024 (€) |
|---|---|---|
| Continuing operations: | ||
| Tournaments and World Chess TV | 545,508 | 394,736 |
| World Chess Online Arena | 863,751 | 691,144 |
| Merchandising | 542,491 | 734,921 |
| Chess advisory services | 77,683 | - |
| Total continuing operations | 2,029,433 | 1,820,801 |
| Discontinued operations: | ||
| Berlin club venue | 232,682 | 613,372 |
| Total revenue | 2,262,115 | 2,434,173 |
| By geographical area | 2025 (€) | 2024 (€) |
|---|---|---|
| United Kingdom | 1,839,934 | 1,677,916 |
| United States of America | 111,786 | 66,085 |
| Europe | 77,713 | 76,800 |
| 2,029,433 | 1,820,801 |
Revenue is reported by geographical area based on the location where the revenue is recognised in the Group’s financial records, rather than the location of the customer. Comparative information has been amended to exclude revenue from discontinued operations.
| By timing of recognition | 2025 (€) | 2024 (€) |
|---|---|---|
| Revenue recognised over time | 1,409,259 | 1,085,880 |
| Revenue recognised at a point in time | 620,174 | 734,921 |
| 2,029,433 | 1,820,801 |
Revenue recognised over time relates primarily to subscription income from the Online Arena and Sponsorship income, which are recognised evenly over the duration of the performance obligation. Revenue recognised at a point in time includes, merchandise sales, which are recognised when control of the goods or services transfers to the customer. Comparative information has been amended to exclude revenue from discontinued operations.
Major customer
Included in Tournaments and World Chess TV revenue are revenues of €371,250 attributable to a major customer (2024: €353,004), which represent more than 10% of revenue. Included in Online Arena revenue are revenues of €475,176 attributable to a major customer (2024: €303,408), being a customer which represents more than 10% of revenue.
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4 EMPLOYEES AND DIRECTORS
| The aggregate payroll costs (including Directors not under employment contracts) | 2025 (€) | 2024 (€) |
|---|---|---|
| Wages and salaries | 815,572 | 1,282,546 |
| Social security costs | 134,150 | 208,280 |
| Pension contributions | 2,446 | 2,334 |
| 952,168 | 1,493,160 |
In the opinion of the Board, only the Directors of the Company, as detailed in the Corporate Governance Report, are regarded as key management personnel. The remuneration of key management personnel during 2025 was, in aggregate, €550,077 (2024: €553,316). Contributions to a defined contribution pension scheme on behalf of Directors of €2,446 (2024: €2,334) were made during the year.
| 2025 (€) | 2024 (€) | |
|---|---|---|
| Directors' remuneration | 550,077 | 553,317 |
| Pension contributions | 2,446 | 2,334 |
| 552,523 | 555,651 |
Further details of Directors’, including Non-Executive Directors’, remuneration and fees during the year are set out in the Directors Remuneration Report on page 34 of these consolidated financial statements. The highest paid director was Ilya Merenzon whose total remuneration was €212,400 (2024: €212,400).
The average number of employees (including Directors) during the year was as follows:
| 2025 | 2024 | |
|---|---|---|
| Directors | 5 | 6 |
| Other Employees | 7 | 24 |
| 12 | 30 |
The Group had no UK employees in 2025 and 2024 except the Directors.
5 NET FINANCE COSTS
| 2025 (€) | 2024 (€) | |
|---|---|---|
| Finance income: | ||
| Loan interest receivable | 1,212 | 139 |
| Finance costs: | ||
| Other interest on loan | (21,856) | (22,367) |
| Net finance costs | (20,644) | (22,228) |
Finance costs relating to discontinued operations are disclosed within note 8.
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6 LOSS BEFORE INCOME TAX – CONTINUING OPERATIONS
The loss before income tax is stated after charging/(crediting):
| 2025 (€) | 2024 (€) | |
|---|---|---|
| Cost of inventories recognised as expense | 1,419,901 | 1,331,799 |
| Research costs expensed | 78,654 | 72,801 |
| Depreciation - owned assets | 384 | 1,312 |
| Exclusive FIDE rights amortisation | 110,529 | 110,529 |
| Licence amortisation | 23,000 | 23,000 |
| Computer software amortisation | 516,083 | 446,357 |
| Auditors' remuneration for the audit of the Companies consolidated group accounts | 121,915 | 104,223 |
| Auditor’s remuneration for the audit of the individual accounts of subsidiaries | - | 44,667 |
| Foreign exchange loss/(gain) | 12,510 | (25,794) |
Amounts relating to discontinued operations are presented within note 8. Comparative information has been amended accordingly.
7 INCOME TAX
Analysis of tax expense/(income)
| 2025 (€) | 2024 (€) | |
|---|---|---|
| Current tax: | ||
| Continuing operations | 192 | 217 |
| Discontinued operations | - | - |
| Deferred tax: | ||
| Continuing operations | - | - |
| Discontinued operations (note 8) | 111,374 | (48,102) |
| Total tax expense/(credit) in consolidated statement of profit or loss and other comprehensive income | 111,566 | (47,855) |
The tax charge relating to discontinued operations is presented within the result from discontinued operations in the Consolidated Statement of Profit or Loss and Other Comprehensive Income (see note 8). Accordingly, the total tax expense recognised in the Consolidated Statement of Profit or Loss and Other Comprehensive Income reflects only the tax charge on continuing operations.
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Factors affecting the tax expense
The tax assessed for the year is lower (2024: lower) than the standard rate of corporation tax in the UK. The difference is explained below:
| 2025 (€) | 2024 (€) | |
|---|---|---|
| Loss before income tax (including discontinued operations) | (3,548,375) | (3,843,031) |
| Loss multiplied by the standard rate of corporation tax in the UK of 25% (2024 - 25%) | (887,094) | (960,758) |
| Effect of: | ||
| Originations and reversal of temporary differences | 111,374 | (48,102) |
| Capital allowances in excess of depreciation | (9,335) | (92,643) |
| Non-taxable expenses | (285,761) | 43,289 |
| Tax losses not recognised | 1,182,190 | 1,010,112 |
| Tax (expense)/income from discontinued operations | (111,374) | 48,102 |
| Foreign tax | 192 | 217 |
| Total tax expense in Consolidated Statement of Profit or Loss and Other Comprehensive Income | 192 | 217 |
8 DISCONTINUED OPERATIONS – BERLIN CLUB VENUE
During the year, the Group ceased operations of the Berlin club, which represents a discontinued operation. The results are presented below.
| 2025 (€) | 2024 (€) | |
|---|---|---|
| Revenue | 232,682 | 613,372 |
| Cost of sales | (174,457) | (300,869) |
| GROSS PROFIT | 58,225 | 312,503 |
| Other operating income | 2,531 | 16,003 |
| Administrative expenses | (874,461) | (1,183,700) |
| OPERATING LOSS | (813,705) | (855,194) |
| Finance costs | (49,328) | (164,958) |
| LOSS BEFORE INCOME TAX | (863,033) | (1,020,152) |
| Income tax | (111,374) | 48,102 |
| LOSS FOR THE YEAR FROM DISCONTINUED OPERATIONS | (974,407) | (972,050) |
Comparative information has been updated to present the Berlin club as a discontinued operation. The loss from discontinued operations includes the impact of impairment charges, lease termination and other related items recognised during the year in relation to the closure of the Berlin club venue which include the gain or loss recognised on the disposal and remeasurement of assets associated with the discontinued operation, as summarised below:
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| 2025 (€) | 2024 (€) | |
|---|---|---|
| Impairment of non-current assets | 1,764,060 | - |
| Gain on derecognition of lease liability | (1,263,128) | - |
| Release of dilapidations provision | (155,887) | - |
| Gain on sale of non-current assets | (9,540) | - |
| Net impact recognised in the year | 335,505 | - |
The impairment of non-current assets relates to the write-down of assets associated with the Berlin club venue following its closure, including property, plant and equipment and the related right-of-use asset. Lease-related adjustments arise from the termination of the associated lease, including derecognition of the lease liability and release of the dilapidations provision. The gain on sale of non-current assets reflects disposals undertaken as part of the closure process. These items are predominantly non-cash in nature, with the exception of proceeds from the disposal of assets. The recoverable amount of the assets associated with the discontinued operation was determined based on fair value less costs of disposal and is categorised as Level 3 within the fair value hierarchy, reflecting the use of unobservable inputs.Cash flows attributable to the discontinued operation are as follows:
| 2025 | 2024 | |
|---|---|---|
| € | € | |
| Net cash used in operating activities | (385,921) | (694,959) |
| Net cash generated from investing activities | 38,201 | (39,315) |
| Decrease in cash and cash equivalents | (347,720) | (734,274) |
9 EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the loss attributable to owners of the parent company by the weighted average number of shares in issue during the year. In calculating the diluted earnings per share, subscribed shares under a binding agreement where no further conditions exist are included as are outstanding share options, warrants and convertible loans where the impact of these is dilutive. As the Group is loss-making, the impact of potential ordinary shares is anti-dilutive and therefore basic and diluted earnings per share are the same.
| 2025 | 2024 | |
|---|---|---|
| Loss attributable to the owners of the parent company (€) | (3,659,941) | (3,795,146) |
| Weighted average number of shares in issue | 779,553,696 | 689,110,129 |
| Basic and diluted earnings per share | ||
| Continuing operations | (0.003) | (0.004) |
| Discontinued operations | (0.002) | (0.002) |
| Total | (0.005) | (0.006) |
Discontinued operations are disclosed in note 8. Subsequent to the year end, as further described in note 30, the Company issued 8,333,333 new ordinary shares in January 2026 for €100,000 and, following shareholder approval, issued a further 175,915,198 new ordinary shares in March 2026 for approximately €1,287,758.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
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10 INTANGIBLE ASSETS
Group
| COST | Exclusive FIDE rights | Software | Online Arena | Crypto-assets | Total |
|---|---|---|---|---|---|
| € | € | € | € | € | |
| At 1 January 2025 | 331,588 | 115,000 | 4,622,229 | 277,166 | 5,345,983 |
| Additions | - | - | 479,234 | 3,422,162 | 3,901,396 |
| Disposals | - | - | - | (3,698,854) | (3,698,854) |
| At 31 December 2025 | 331,588 | 115,000 | 5,101,463 | 474 | 5,548,525 |
| AMORTISATION | Exclusive FIDE rights | Software | Online Arena | Crypto-assets | Total |
|---|---|---|---|---|---|
| € | € | € | € | € | |
| At 1 January 2025 | 110,529 | 79,000 | 1,679,304 | - | 1,868,833 |
| Amortisation for year | 110,529 | 23,000 | 516,083 | - | 649,612 |
| At 31 December 2025 | 221,058 | 102,000 | 2,195,387 | - | 2,518,445 |
| NET BOOK VALUE | |||||
|---|---|---|---|---|---|
| At 31 December 2025 | 110,530 | 13,000 | 2,906,076 | 474 | 3,030,080 |
| COST | Exclusive FIDE rights | Software | Online Arena | Crypto-assets | Total |
|---|---|---|---|---|---|
| € | € | € | € | € | |
| At 1 January 2024 | 331,588 | 115,000 | 3,924,971 | 4,215 | 4,375,774 |
| Additions | - | - | 697,258 | 5,776,269 | 6,473,527 |
| Disposals | - | - | - | (5,503,318) | (5,503,318) |
| At 31 December 2024 | 331,588 | 115,000 | 4,622,229 | 277,166 | 5,345,983 |
| AMORTISATION | Exclusive FIDE rights | Software | Online Arena | Crypto-assets | Total |
|---|---|---|---|---|---|
| € | € | € | € | € | |
| At 1 January 2024 | - | 56,000 | 1,232,947 | - | 1,288,947 |
| Amortisation for year | 110,529 | 23,000 | 446,357 | - | 579,886 |
| At 31 December 2024 | 110,529 | 79,000 | 1,679,304 | - | 1,868,833 |
| NET BOOK VALUE | |||||
|---|---|---|---|---|---|
| At 31 December 2024 | 221,059 | 36,000 | 2,942,925 | 277,166 | 3,477,150 |
The Directors considered the carrying value at 31 December 2025 for each asset identified above (except crypto-assets), based on a detailed budget and forecast, discounted over five years at the Groups current cost of capital, considered by the Directors to be 13.29%, and it was determined that no impairment was required. Where an asset does not generate cash inflows that are largely independent of the cash inflows from other assets or groups of assets the carrying value was considered against the smallest identifiable group of assets that generates cash inflows (cash generating unit or CGU). The Directors considered the carrying value at 31 December 2025 for crypto-assets based on the prevailing exchange rate at which the crypto-asset could readily be converted into US dollars or Euros and it was determined that no impairment was required.
11 PROPERTY, PLANT AND EQUIPMENT
Group
World Chess Plc – Company Registration No. 10589323
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Page 76 of 87
| COST | Right of use asset | Fixtures and fittings | Computer Equipment | Total |
|---|---|---|---|---|
| € | € | € | € | |
| At 1 January 2025 | 1,495,114 | 1,322,946 | 1,698 | 2,819,758 |
| Additions | - | 5,235 | - | 5,235 |
| Disposals | (1,495,114) | (1,249,228) | - | (2,744,342) |
| At 31 December 2025 | - | 78,953 | 1,698 | 80,651 |
| DEPRECIATION | Right of use asset | Fixtures and fittings | Computer Equipment | Total |
|---|---|---|---|---|
| € | € | € | € | |
| At 1 January 2025 | 439,147 | 387,706 | 1,698 | 828,551 |
| Charge for year | 62,855 | 126,765 | - | 189,620 |
| Elimination on disposal | (502,002) | (444,193) | - | (946,195) |
| At 31 December 2025 | - | 70,278 | 1,698 | 71,976 |
| NET BOOK VALUE | ||||
|---|---|---|---|---|
| At 31 December 2025 | - | 8,675 | - | 8,675 |
During the year, following the closure of the Berlin club venue, the Group derecognised assets associated with the venue, including the right-of-use asset and fixtures and fittings. The movements presented as disposals in the table above comprise a combination of impairments, scrappage and disposals and do not represent disposals for consideration in all cases. These include an impairment charge of €1,764,060 recognised in relation to the discontinued Berlin club (see note 8).
| Right of use asset | Fixtures and fittings | Computer Equipment | Total | |
|---|---|---|---|---|
| COST | € | € | € | € |
| At 1 January 2024 | 1,495,114 | 1,283,631 | 1,698 | 2,780,443 |
| Additions | - | 39,315 | - | 39,315 |
| At 31 December 2024 | 1,495,114 | 1,322,946 | 1,698 | 2,819,758 |
| DEPRECIATION | ||||
| At 1 January 2024 | 288,294 | 254,115 | 1,698 | 544,107 |
| Charge for year | 150,853 | 133,591 | - | 284,444 |
| At 31 December 2024 | 439,147 | 387,706 | 1,698 | 828,551 |
| NET BOOK VALUE | ||||
| At 31 December 2024 | 1,055,967 | 935,240 | - | 1,991,207 |
12 INVESTMENTS
Company
| Shares in group undertakings | 2025 | 2024 |
|---|---|---|
| € | € | |
| COST | ||
| At 1 January | 351,616 | 351,616 |
| At 31 December | 351,616 | 351,616 |
| IMPAIRMENTS | ||
| At 1 January | 50,000 | 50,000 |
| Charge for year | 300,000 | - |
| At 31 December | 350,000 | 50,000 |
| CARRYING VALUE | ||
| At 1 January | 301,616 | 301,616 |
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Page 77 of 87
| 2025 | 2024 | |
|---|---|---|
| At 31 December | 1,616 | 301,616 |
The Directors have assessed the carrying value of each group undertaking at 31 December 2025 based on detailed budgets and forecasts covering a five-year period, discounted at the Group’s current cost of capital of 13.29%. As a result of this assessment, the investment in World Chess Europe GmbH has been fully impaired to €nil following the closure of the Berlin club. The Group’s investments at the Statement of Financial Position date in the share capital of companies include the following subsidiaries:
World Chess Events Limited
Registered office: Eastcastle House, 27/28 Eastcastle Street, United Kingdom, W1W 8DH
Nature of business: Organising chess events (Worldwide)
Class of shares: Ordinary | % holding: 100.00
World Chess US, Inc
Registered office: 1201 N. Orange Street, Suite 762, Wilmington, New Castle County, DE, USA 19801
Nature of business: Organising chess events (USA), online chess
Class of shares: Ordinary | % holding: 100.00
World Chess Europe GmbH
Registered office: Mittelstrasse 51 – 53, 10117 Berlin, Deutschland
Nature of business: Various chess related activities
Class of shares: Ordinary | % holding: 100.00
World Chess Sakartvelo LLC
Registered office: Georgia, City Tbilisi, Didube district, Ak. Tsereteli Avenue, N 49-51-51a, Entrance 3, Floor 13, Apartment N 128
Nature of business: Organising chess events, chess club activities
Class of shares: Ordinary | % holding: 100.00
World Chess Sakartvelo LLC remained dormant throughout the year and had no material transactions. The results of the subsidiaries identified above are included in the consolidated financial statements. All subsidiaries are exempt from an audit. World Chess Events Limited are exempt from audit by virtue of s479A of the Companies Act 2006.
13 INVENTORIES
| Group | 2025 | 2024 |
|---|---|---|
| € | € | |
| Inventories: | 129,512 | 147,549 |
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
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14 TRADE AND OTHER RECEIVABLES
| Group 2025 | Group 2024 | Company 2025 | Company 2024 | |
|---|---|---|---|---|
| € | € | € | € | |
| Current: | ||||
| Trade receivables | 8,337 | 50,447 | - | - |
| Amounts owed by group undertakings | - | - | - | 4,713,473 |
| Other receivables | 18,541 | 36,902 | 1,306 | 1,306 |
| Prepayments and accrued income | 98,264 | 146,818 | 5,738 | 18,036 |
| Amounts owed by Directors | 12,421 | - | - | - |
| 137,563 | 234,167 | 7,044 | 4,732,815 | |
| Non-current: | ||||
| Amounts owed by group undertakings | - | - | 7,425,069 | - |
| Other receivables | - | 162,884 | - | - |
| 137,563 | 397,051 | 7,432,113 | 4,732,815 |
15 CASH AND CASH EQUIVALENTS
| Group 2025 | Group 2024 | Company 2025 | Company 2024 | |
|---|---|---|---|---|
| € | € | € | € | |
| Bank accounts | 40,732 | 267,396 | 5,524 | 6,551 |
| 40,732 | 267,396 | 5,524 | 6,551 |
16 CALLED UP SHARE CAPITAL
| 2025 Number of shares | 2025 € | 2024 Number of shares | 2024 € | |
|---|---|---|---|---|
| Allotted, issued, and fully paid Ordinary shares of £0.0001 | 879,605,147 | 100,495 | 691,724,039 | 78,520 |
On 14 January 2025, the Company issued 717,948 new ordinary shares to a senior consultant in lieu of fees of €33,177. On 24 February 2025, the Company issued 10,666,672 new ordinary shares for total cash consideration of €400,000 and 12,000,000 new ordinary shares for total consideration of €1,200,000, which had been received prior to 31 December 2024 and were included within share capital to be issued at that date. On 3 June 2025, the Company issued 25,757,575 new ordinary shares to Ilya Merenzon, comprising the conversion of €653,576 of convertible loan notes and a subscription for €356,496. The loan note conversion was a non-cash transaction, with the balance received in cash during the year. Further details are set out in note 27. On 24 June 2025, the Company issued 24,390,243 new ordinary shares to Ilya Merenzon pursuant to a subscription for cash consideration of €937,920. Further details of this transaction are set out in note 27. On 26 August 2025, the Company issued 114,348,670 new ordinary shares to a new strategic investor for
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total cash consideration of €1,714,666, with transaction costs of €102,512 directly attributable to the share issue recognised as a deduction from equity (share premium). At 31 December 2025, the number of additional shares authorised for issue is 121,547,012, which includes 25,952,901 shares which the Company has committed to issue in accordance with binding subscription agreements (2024: 205,326,214 which included 34,333,859 under binding subscription agreements).# 17 SHARE PREMIUM
| 2025 | 2024 | |
|---|---|---|
| € | € | |
| At 1 January | 12,754,046 | 11,048,183 |
| Premium arising on issue of equity shares | 5,273,862 | 1,705,863 |
| Transaction costs on issue of shares | (102,512) | - |
| At 31 December | 17,925,396 | 12,754,046 |
18 RESERVES
Share capital comprises the amount for the nominal value of shares issued. Share premium comprises the amount subscribed for share capital which exceeds the nominal value, after deducting costs of issue. Share capital to be issued comprises amounts received under binding share subscription agreements where shares have not yet been issued. The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations. Retained earnings comprises the brought forward cumulative profit and loss balances carried forward from previous accounting periods.
19 TRADE AND OTHER PAYABLES
| Group 2025 | Group 2024 | Company 2025 | Company 2024 | |
|---|---|---|---|---|
| € | € | € | € | |
| Trade payables | 1,052,110 | 1,211,014 | 48,796 | 119,402 |
| Amounts owed to group undertakings | - | - | - | 156,552 |
| Social security and other taxes | 69,031 | 78,875 | 44,801 | 60,277 |
| Other payables | 117,492 | 17,302 | 70 | 75 |
| Accruals and deferred income | 607,258 | 1,033,931 | 124,019 | 99,854 |
| Amounts owed to Directors | 49,947 | 300,865 | 144,691 | 194,322 |
| 1,895,838 | 2,641,987 | 362,377 | 630,482 |
Included in accruals and deferred income at the start of the period was €579,869 (2024: €530,887) of deferred income which was recognised as revenue during the year.
20 FINANCIAL LIABILITIES - BORROWINGS
| Group 2025 | Group 2024 | Company 2025 | Company 2024 | |
|---|---|---|---|---|
| € | € | € | € | |
| Current interest-bearing loans and borrowings | - | 1,401,543 | - | - |
World Chess Plc – Company Registration No. 10589323 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Page 80 of 87
At 31 December 2025, the Group had no outstanding interest-bearing loans or borrowings (2024: €1,401,543), the prior year balance having been fully repaid during the year from the proceeds of equity fundraisings. The Group continues to have access to a loan facility of up to €6,000,000 with UAB Intis Telecom, which remains available for drawdown. Under the terms of the facility, the interest rate is 12% per annum, with final repayment due on 31 December 2026.
21 FINANCIAL LIABILITIES - LEASES
Lease liabilities
The lease liability and corresponding right-of-use asset recognised in respect of the Berlin club are as follows:
| Group | 2025 | 2024 |
|---|---|---|
| € | € | |
| Right-of-use assets | - | 1,055,967 |
| Current lease liability | - | 129,955 |
| Non-current lease liability | - | 1,174,319 |
| - | 1,304,274 |
A right-of-use asset was recognised in 2022 in respect of a lease of premises occupied by the Berlin club venue, which had an original term of 10 years ending on 31 December 2031. An addition to the right-of- use asset of €120,705 was recognised during 2023 following an increase in lease payments after a review. During the year, following the closure of the Berlin club, the lease was terminated and the associated right-of-use asset and lease liability were derecognised. The resulting gain on derecognition of the lease liability has been recognised within discontinued operations (see note 8). Following termination of the lease, the Group has no remaining lease liabilities at 31 December 2025. All lease-related amounts for the year relate to discontinued operations.
22 FINANCIAL INSTRUMENTS
Financial instruments used by the Group, from which financial instrument risk arises, are as follows:
* trade and other payables;
* cash and cash equivalents; and
* trade and other receivables.
The main purpose of these financial instruments is to finance the Group’s operations and manage working capital requirements. Financial instruments are measured at amortised cost. Crypto-assets are not financial instruments and are measured at fair value through profit or loss. The Group holds crypto-assets as part of its treasury activities and monitors their fair value at each reporting date. The fair value of crypto-assets is categorised as Level 1 within the fair value hierarchy, based on quoted prices in active markets.
| 2025 | 2024 | |
|---|---|---|
| Other financial assets | € | € |
| Trade and other receivables more than one year | - | 162,884 |
| Trade and other receivables less than one year | 137,563 | 234,167 |
| Cash and cash equivalents | 40,732 | 267,396 |
| Total financial assets | 178,295 | 664,447 |
World Chess Plc – Company Registration No. 10589323 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Page 81 of 87
| 2025 | 2024 | |
|---|---|---|
| Other financial liabilities | € | € |
| Lease liabilities more than one year | - | 1,174,319 |
| Trade payables less than one year | 1,052,110 | 1,211,014 |
| Other payables less than one year | 236,470 | 397,042 |
| Lease liabilities less than one year | - | 129,955 |
| Interest bearing loans and borrowings less than one year | - | 1,401,543 |
| Total financial liabilities | 1,288,580 | 4,313,873 |
The Directors consider that the carrying value for each class of financial asset and liability, approximates to their fair value.
Financial risk management
The Group's activities expose it to a variety of risks, including market risk (foreign currency risk and interest rate risk), credit risk and liquidity risk. The Group manages these risks through an effective risk management programme, and, through this programme, the Board seeks to minimise the potential adverse effects on the Group's financial performance.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer to a financial instrument fails to meet its contractual obligations. The Group's credit risk is primarily attributable to its receivables and its cash deposits. It is Group policy to assess the credit risk of new customers before entering into contracts. The Group continues to assess the risk and a further loss allowance for the full lifetime expected credit losses is recognised if the credit risk has increased significantly since initial recognition. The Group considers any contractual payment being 30 days past due, and each subsequent period of 30 days, to be an indicator of a significant increase in credit risk which may require an additional loss allowance to be recorded. The Group considers a financial asset to be in default when contractual payments are more than 90 days past due or where there is other objective evidence that the counterparty is unlikely to pay. This definition is consistent with the Group’s historical experience and reflects the point at which credit losses are typically incurred.
The risks specific to the Group’s revenue types within its activities are outlined below:
* Events, payment is typically received in accordance with multi-year agreement in advance of the event to which it relates, the Directors therefore consider the credit risk to be low.
* Online income, payment is typically received annually in advance, the Directors therefore consider the credit risk to be trivial.
* Merchandising and Clubs, payment is typically received prior to control of goods purchased being transferred to the customer, the Directors therefore consider the risk to be non-trivial but minimal.
Credit losses of €6,514 were recognised during the year (2024: €14,010). This amount relates to a specific provision against a trade receivable and is not representative of the Group’s overall expected credit loss assessment under IFRS 9.
World Chess Plc – Company Registration No. 10589323 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Page 82 of 87
Financial assets past due but not impaired as at 31 December 2025:
| Not impaired and not past due | >30 days | >60 days | >90 days | >120 days | |
|---|---|---|---|---|---|
| € | € | € | € | € | |
| Group: Trade and other receivables less than one year | 39,299 | - | - | - | - |
| Company: Trade and other receivables more than one year | 7,426,374 | - | - | - | - |
Financial assets past due but not impaired as at 31 December 2024:
| Not impaired and not past due | >30 days | >60 days | >90 days | >120 days | |
|---|---|---|---|---|---|
| € | € | € | € | € | |
| Group: Trade and other receivables more than one year | 162,884 | - | - | - | - |
| Group: Trade and other receivables less than one year | 75,909 | 11,440 | - | - | - |
| Company: Trade and other receivables less than one year | 4,714,779 | - | - | - | - |
Liquidity risk and interest rate risk
Liquidity risk arises from the Group's management of working capital. It is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due. The Group’s funding strategy is to ensure a mix of funding sources offering flexibility and cost effectiveness to match the requirements of the Group. At 31 December 2025, the Group had no outstanding loans due within one year (2024: €1,401,543).
Foreign currency risk
The Group's exposure to foreign currency risk is limited as most of its invoicing and payments are denominated in Euro. The Group identifies and manages currency risks using an integrated approach that takes into account the possibility of natural (economic) hedging. For the purpose of short-term management of currency risk, the Group selects the currency to reduce the open currency position (the difference between assets and liabilities in foreign currencies).
Analysis of sensitivity of financial instruments to foreign currency exchange rate risk
Currency risk is assessed monthly using sensitivity analysis and maintained within parameters approved in accordance with the Group's policy. At the reporting date, the effect of the Euro's growth/(depreciation) against other currencies in the Group's profit/(loss) before tax is not significant.
The Group does not have any financial assets or financial liabilities that are subject to enforceable netting arrangements or similar agreements. Accordingly, no offsetting disclosures are presented.
World Chess Plc – Company Registration No. 10589323 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Page 83 of 87
23 CAPITAL MANAGEMENT
The Group’s objective when managing capital is to safeguard the Group’s ability to continue as a going concern, so that it can continue to provide returns to shareholders and benefits for other stakeholders.The Group's capital management strategy is to retain sufficient working capital for operating requirements and to ensure sufficient funding is available to meet commitments as they fall due and to support growth. There are no externally imposed capital requirements. The Group had net assets of €1,458,391 at 31 December 2025, (2024: €950,770).
| 2025 | 2024 | |
|---|---|---|
| € | € | |
| Interest bearing loans and borrowings | - | (1,401,543) |
| Amounts owed to directors | (49,947) | (300,865) |
| Lease liabilities | - | (1,304,274) |
| Cash and cash equivalents | 40,732 | 267,396 |
| Net indebtedness | (9,215) | (2,739,286) |
Amounts owed to Directors includes balances due to Directors disclosed in note 27 to the financial statements. Although classified under ‘trade and other payables’ in the Statement of Financial Position, these amounts represent short-term financing from Directors and are included in net indebtedness.
24 PROVISION FOR LIABILITIES
| Group | 2025 | 2024 |
|---|---|---|
| PROVISIONS | € | € |
| At 1 January | 157,887 | 157,887 |
| Reversal of dilapidations provision | (155,887) | - |
| At 31 December | 2,000 | 157,887 |
A dilapidations provision was recognised in 2022 in respect of the Berlin club lease. Following the closure of the venue and termination of the lease during the year, the obligation ceased to exist and the provision was fully released, with the resulting credit recognised within discontinued operations (see note 8)
25 DEFERRED TAX
| Group | 2025 | 2024 |
|---|---|---|
| € | € | |
| Balance at 1 January | 111,374 | 63,272 |
| Movement in current year | (111,374) | 48,102 |
| Balance at 31 December | - | 111,374 |
There are €15,495,849 (2024: €9,917,456) of tax losses available to the Group which, at the applicable tax rate of 25%, would provide an additional deferred tax asset of €3,873,962 (2024: €2,479,364). This has not been recognised in the financial statements due to the uncertainty of the timing of future taxable profits against which these losses could be utilised. Deferred tax assets and liabilities are offset when the Company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
Analysis of deferred tax:
| 2025 | 2024 | |
|---|---|---|
| € | € | |
| Timing differences arising on provisions for liabilities, lease liabilities and losses carried forward | - | (430,942) |
| Timing difference arising on capital allowances in excess of depreciation | - | 319,568 |
| - | (111,374) |
26 CONTINGENT LIABILITIES
The Group has an ongoing claim with one supplier, if the claim is successful then an invoice, amounting to €1,140,000, will become payable. The invoice has not been provided for in the financial statements as the Directors consider it to be null and void and raised by the supplier in breach of contract.
27 RELATED PARTY DISCLOSURES
Details of the Directors’ remuneration are disclosed in note 4 and in the Directors Remuneration Report on page 34 of these consolidated financial statements.
Group undertakings
Intercompany balances and transactions between the Company and its subsidiaries are eliminated on consolidation. These balances arise from normal trading activities, loans, and cost recharges. Intercompany loans are measured at amortised cost, with expected credit loss provisions recognised where applicable under IFRS 9.
The following transactions took place during the year ended 31 December 2025 with and between group undertakings.
| Interest paid/ (received) | Purchase/ (sales) of inventory | Purchase/ (sale) of services | Transaction fees paid/ (received) | |
|---|---|---|---|---|
| € | € | € | € | |
| World Chess PLC | (119,113) | - | - | - |
| World Chess Events Ltd | - | (29,712) | (4,000) | 43,995 |
| World Chess Europe GmbH | 119,113 | 1,693 | - | - |
| World Chess US Inc. | - | 28,019 | 4,000 | (43,995) |
| World Chess Sakartvelo LLC | - | - | - | - |
The following transactions took place during the year ended 31 December 2025 with the Company.
| Interest paid/ (received) | Purchase/ (sales) of inventory | Purchase/ (sale) of services | Transaction fees paid/ (received) | |
|---|---|---|---|---|
| € | € | € | € | |
| World Chess Europe GmbH | 119,113 | - | - | - |
The following transactions took place during the year ended 31 December 2024 with and between group undertakings.
| Interest paid/ (received) | Purchase/ (sales) of inventory | Purchase/ (sale) of services | Transaction fees paid/ (received) | |
|---|---|---|---|---|
| € | € | € | € | |
| World Chess PLC | (112,675) | - | - | - |
| World Chess Events Ltd | 12,762 | (8,887) | 82,500 | 54,561 |
| World Chess Europe GmbH | 99,913 | 7,254 | - | - |
| World Chess US Inc. | - | 1,633 | 7,500 | (54,561) |
| World Chess Sakartvelo LLC | - | - | (90,000) | - |
The following transactions took place during the year ended 31 December 2024 with the Company.
| Interest paid/ (received) | Purchase/ (sales) of inventory | Purchase/ (sale) of services | Transaction fees paid/ (received) | |
|---|---|---|---|---|
| € | € | € | € | |
| World Chess Events Ltd | 12,762 | - | - | - |
| World Chess Europe GmbH | 99,913 | - | - | - |
The following movement on Director (payables) and receivables with the Group took place during the year ended 31 December 2025.
| (Payable)/ receivable at 1 January 2025 | Increase in payables and received from director | Increase in receivables and paid to director | (Payable)/ receivable at 31 December 2025 | |
|---|---|---|---|---|
| € | € | € | € | |
| Ilya Merenzon | (263,761) | 962,984 | (686,802) | 12,421 |
| Matvey Shekhovtsov | (16,800) | 4,800 | (2,400) | (14,400) |
| Graham Woolfman | (6,236) | (6,236) | - | - |
| Jamison Firestone | (4,698) | - | (2,181) | (6,879) |
| Richard Collett | (14,673) | - | (5,837) | (20,510) |
| Neil Rafferty | (4,698) | - | (3,460) | (8,158) |
During the year, the Company entered into three additional transactions with Ilya Merenzon, comprising the issue and conversion of €653,576 of convertible loan notes and subscriptions for new ordinary shares totalling €1,294,416. On 3 June 2025, 25,757,575 new ordinary shares were issued, comprising the conversion of the loan notes and a subscription of €356,496. A further 9,090,909 new ordinary shares were issued on 24 June 2025 for cash consideration of €937,920. These transactions were undertaken at market price, on terms agreed between the parties, and were approved by the Board.
The following movement on Director (payables) and receivables with the Group took place during the year ended 31 December 2024.
| (Payable)/ receivable at 1 January 2024 | Increase in payables and received from director | Increase in receivables and paid to director | (Payable)/ receivable at 31 December 2024 | |
|---|---|---|---|---|
| € | € | € | € | |
| Ilya Merenzon | (133,186) | (1,034,143) | 903,568 | (263,761) |
| Matvey Shekhovtsov | (1,582) | (16,800) | 1,582 | (16,800) |
| Graham Woolfman | - | (6,236) | - | (6,236) |
| Jamison Firestone | - | (4,698) | - | (4,698) |
| Richard Collett | - | (14,673) | - | (14,673) |
| Neil Rafferty | (312) | (4,698) | 312 | (4,698) |
The following movement on Director (payables) and receivables with the Company took place during the year ended 31 December 2025.
| (Payable)/ receivable at 1 January 2025 | Increase in payables and received from director | Increase in receivables and paid to director | (Payable)/ receivable at 31 December 2025 | |
|---|---|---|---|---|
| € | € | € | € | |
| Ilya Merenzon | (147,217) | 191,019 | (138,546) | (94,744) |
| Matvey Shekhovtsov | (16,800) | 4,800 | (2,400) | (14,400) |
| Graham Woolfman | (6,236) | 6,236 | - | - |
| Jamison Firestone | (4,698) | - | (2,181) | (6,879) |
| Richard Collett | (14,673) | - | (5,837) | (20,510) |
| Neil Rafferty | (4,698) | - | (3,460) | (8,158) |
The following movement on Director (payables) and receivables with the Company took place during the year ended 31 December 2024.
| (Payable)/ receivable at 1 January 2024 | Increase in payables and received from director | Increase in receivables and paid to director | (Payable)/ receivable at 31 December 2024 | |
|---|---|---|---|---|
| € | € | € | € | |
| Ilya Merenzon | (18,015) | (169,900) | 40,698 | (147,217) |
| Matvey Shekhovtsov | (1,582) | (16,800) | 1,582 | (16,800) |
| Graham Woolfman | - | (6,236) | - | (6,236) |
| Jamison Firestone | - | (4,698) | - | (4,698) |
| Richard Collett | - | (14,673) | - | (14,673) |
| Neil Rafferty | (312) | (4,698) | 312 | (4,698) |
The following balances remained outstanding at 31 December with related parties.
Included in trade and other payables
| Group 2025 | Group 2024 | Company 2025 | Company 2024 | |
|---|---|---|---|---|
| Related party | € | € | € | € |
| Group undertakings | ||||
| World Chess Events Ltd | n/a | n/a | - | - |
| World Chess Europe GmbH | n/a | n/a | - | - |
| World Chess US Inc. | n/a | n/a | - | 156,552 |
| World Chess Sakartvelo LLC | n/a | n/a | - | - |
| Directors | ||||
| Ilya Merenzon | - | 253,760 | 94,744 | 147,217 |
| Matvey Shekhovtsov | 14,400 | 16,800 | 14,400 | 16,800 |
| Graham Woolfman | - | 6,236 | - | 6,236 |
| Jamison Firestone | 6,879 | 4,698 | 6,879 | 4,698 |
| Richard Collett | 20,510 | 14,673 | 20,510 | 14,673 |
| Neil Rafferty | 8,158 | 4,698 | 8,158 | 4,698 |
Included in trade and other receivables
| Group 2025 | Group 2024 | Company 2025 | Company 2024 | |
|---|---|---|---|---|
| Related party | € | € | € | € |
| Group undertakings | ||||
| World Chess Events Ltd | n/a | n/a | 6,962,574 | 4,713,473 |
| World Chess US Inc. | n/a | n/a | 462,495 | - |
| Directors | ||||
| Ilya Merenzon | 12,421 | - | - | - |
28 ULTIMATE CONTROLLING PARTY
The ultimate controlling party is Ilya Merenzon by virtue of his shareholding in the Company.
29 SHARE-BASED PAYMENT TRANSACTIONS
On 14 January 2025, the Company issued 717,948 new ordinary shares to a senior consultant in lieu of fees of €33,177.
30 SUBSEQUENT EVENTS
Subsequent to the reporting date, on 15 January 2026, the Company issued 8,333,333 new ordinary shares for total cash consideration of €100,000. In addition, following shareholder approval, the Company issued a further 175,915,198 new ordinary shares on 1 April 2026 for total cash consideration of €1,287,758. The total proceeds raised subsequent to the reporting date amounted to approximately €1.39 million. These proceeds strengthen the Group’s working capital position.