Annual Financial Report

VALUE AND INDEXED PROPERTY INCOME TRUST PLC

FULL YEAR RESULTS FOR THE YEAR ENDED 31 MARCH 2025

Value and Indexed Property Income Trust PLC (VIP), the real estate investment trust generating long, strong, indexed income from commercial property, announces the publication of the Company's Annual Results for the year ended 31 March 2025. VIP became a REIT on 1 April 2025.

The Annual Report will be sent to Shareholders and is available below and also on the Investment Manager's website at https://olimproperty.co.uk/value-and-indexed-property-income-trust.html

Key Highlights

· Over the year, VIP's share price increased by 6.9% to give a share price total return of 15.0%.

· The net asset value (NAV) total return was 7.1%.

· The dividend yield at 31 March 2025 was 7.5% (2024: 7.7%).

· The property portfolio delivered a total return of 9.0% over the year against 6.3% for the benchmark, the MSCI UK Quarterly Property Index. 

· 97% of rent reviews are now linked to inflation (88% to the Retail Prices Index (RPI) and a further 9% to the Consumer Prices Index (CPI).

· Disposal of six properties totalling £12.4 million, 5.0% above their valuation total at a net initial yield of 7.4%.

· Acquisition of the Bridgemere Garden Centre investment near Nantwich for £16.5 million at a net initial yield of 6.6%, rising to 7.8% in December 2025, let on an RPI-linked lease with 24 years unexpired.

· Average interest rate on VIP's borrowings now 4.5% (of which 96% is fixed), average loan length 6.9 years and loan to value ratio 39%. 

· £10 million of a £15 million loan expiring in March 2026 repaid (£6 million in January 2025 and £4 million in April 2025, post VIP's year end).

During the year to 31 March 2025, Value and Indexed Property Income Trust PLC (VIP or the Company) was an investment trust company listed on the London Stock Exchange. On 1 April 2025, the Company became a UK Real Estate Investment Trust (REIT). The Company invests directly in UK commercial property to deliver long, strong, indexed income.

VIP's medium term dividend policy is for increases at least in line with inflation, underpinned by VIP's indexed property income, and the dividend per share has risen every year since 1986 when OLIM's management began. It has risen by 1,004% (6.5% p.a.) against the Retail Prices Index rise of 293% (3.7% p.a.). Three interim dividends of 3.4p each were paid on 25 October 2024, 31 January 2025, and 25 April 2025. The targeted total dividend for the full year is 13.8p (+4.5%), including a recommended final dividend of 3.6p to be paid as a PID (Property Income Distribution) on 25 July 2025.

VIP's property portfolio is valued at £146 million and delivered a total return of 9.0% over the year against 6.3% for the MSCI UK Quarterly Property Index. Over the past five years, the VIP property return was 3.9% p.a. (Index 2.1% p.a.), over 10 years it was 6.7% p.a. (Index 4.0% p.a.) and over 38 years it was 10.9% p.a. (Index 7.7% p.a.).

Over the year to 31 March 2025, VIP's portfolio was improved by the sale of six properties for a total of £12.4 million (£12.3 million net), 5.0% above their valuation total at a net initial yield of 7.4%. These sales comprised four shorter let industrial investments, a short let library and convenience store in Wales and an over-rented London pub. One acquisition was made during the year, the Bridgemere Garden Centre investment near Nantwich, for £16.5 million (£17.5 million including costs) at a net initial yield of 6.6%, rising to 7.8% in December 2025 with 24 years unexpired to Blue Diamond UK Ltd on an RPI-linked lease.

NOTICE OF AGM

The Annual General Meeting of the Company will be held at 12.30pm on Thursday,10 July 2025 at the offices of Shepherd & Wedderburn LLP, 4th Floor, 1-6 Lombard Street, London, EC3V 9AA. 

Enquiries:

OLIM Property Limited, Investment Manager - Tel: 020 7846 3252

[email protected]

[email protected]

[email protected]

10 June 2025

About VIP: The policy of the Company is to invest directly in UK commercial property and cash or near cash securities to deliver long, strong index-related income. The Company will not invest in overseas property or securities or in unquoted companies. UK directly held commercial property will usually account for at least 80% of the total portfolio but it may fall below that level if relative market levels and investment value, or a desired increase in cash or near cash securities, make it appropriate. The Company will not use derivatives.

https://www.investormeetcompany.com/value-and-indexed-property-income-trust-plc/register-investor

Strategic Report

Chairman's Statement

I am pleased to report that the Company has now completed the transition begun in 2021 from a mainly equity-based investment trust to a property company, and on 1 April 2025 it became a Real Estate Investment Trust (REIT), with the tax and marketing advantages that status offers. Subject to approval at this years' Annual General Meeting (AGM), Shareholders will receive their first Property Income Distribution (PID) on 25 July 2025. Further information on the Company's new REIT status can be found in the Annual Report or by visiting the Company's web pages hosted by the Investment Manager at http://www.olimproperty.co.uk/value-and-indexed-property-income-trust.html.

The Company is proud of its sustained record of progressive dividend growth, which it seeks to continue to maintain. At the year end, the yield on the Company's shares (at the proposed dividend) was 7.5%.

Rents in the property portfolio are all indexed, although the details of the indexation provisions vary - some are linked to the Retail Prices Index (RPI), others to the Consumer Prices Index (CPI), which is the reference measure for the Bank of England's target, which generally rises slightly more slowly. Most reviews are subject to caps and collars. As the table below shows, the return on the Company's portfolio should broadly match inflation so long as the rate does not differ too much from the official target.

The portfolio has increased marginally in capital value during the period under review, and the Company's NAV total return for the year is 7.1%. Some smaller and lower quality properties have been sold and the major change in portfolio structure is the acquisition of a large garden centre in a prosperous part of north-west England. The portfolio is diversified by sector and geography but the emphasis on alternatives remains strong.

The property portfolio's total return, including both income and capital growth, has been 9.0% over the year. This return outperformed the 6.3% return on its benchmark, the MSCI UK Quarterly Property Index, as it has over 5, 10, 20 and 38 years.

The share price total return for the year is 15.0%, substantially above the NAV total return, due to a continued and welcome reduction in the discount of the share price to NAV. The Board reiterates its commitment to Shareholders to provide an exit at NAV less costs and proposals to achieve this will be put to the 2026 AGM.

The economic outlook has become more uncertain, and as I write, the news is filled with the erratic and bombastic utterances of President Trump. While his tariff measures have little direct impact on the performance of the investments in our portfolio, the resulting disruption to world trade and the increase in the uncertainties which affect all businesses can only be detrimental. We have some protection from instabilities in financial markets as a result of moves to secure longer term financing of our debt, but short term predictions of inflation and interest rates are particularly hazardous today.

The property market has stabilised. This follows difficult years, characterised by the Covid pandemic and the end of the abnormal period of very low interest rates which followed the financial crisis. Although these factors affected all kinds of property, different sectors experienced differential effects. Secondary retail and office properties suffered from the continued growth of online retailing and the development of 'working from home'.

The Board believes that these trends are permanent. Offices which do not meet modern expectations of amenities and environmental standards will continue to lose value. The city centres of the future will have a very different character from their historic emphasis on functional shops and other services for office workers.

The Company's portfolio has benefited from the Manager's early recognition of these changes and the rebalancing of property investment towards out-of-town facilities - 'alternatives' and industrials/warehouses - properties outside the traditional sectoral focus on offices and shops.

International geopolitics are threatening. The wars in Gaza and Ukraine continue, and Chinese political priorities are evidently more aggressive in tone. While UK politics appear relatively stable, the long century in which political opinions and political parties were identifiably placed along a one-dimensional left-to-right axis of economic policies is at an end. The proximate causes and particular manifestations of the decline of traditional allegiances are different in the UK, the US, France, Germany, Italy and other countries. But the phenomenon is common across the Western world and the consequences will play out over decades to come.

These consequences may include the rise of populist strong men, the fragmentation of political parties, and the realignment of international alliances. All these events are likely to have negative effects on markets, although they will also offer opportunities. Advances in technology will continue to change the nature of business, in ways that will change the nature and identity of desirable property assets. A portfolio such as ours, based on real assets with inbuilt protection against inflation, should offer a safer, if not safe, haven in such an uncertain world.

The Board is recommending a final dividend of 3.6 pence per Ordinary Share making total dividends of 13.8p per share for the year to 31 March 2025 compared to 13.2p per Ordinary Share for the previous year, an increase of 4.5%. Subject to Shareholder approval at the 2025 AGM, the final dividend, which will be paid as a PID, will be paid on 25 July 2025 to Shareholders on the register on 27 June 2025. The ex-dividend date is 26 June 2025.

During the year under review, the Directors were delighted to announce the appointment of Lorraine Reader as a Non-executive Director, further strengthening the Board's overall property expertise.

Following the completion of the transition from an investment trust to an exclusively property oriented company, I have decided to retire after 31 years on the Board. I am proud of the dividend record the Company has been able to maintain over this period and believe that the income and capital returns have served Shareholders well. I am confident that the Company will continue to prosper under its new status with its newer Directors. Accordingly, I will step down as Chairman and from the Board following the conclusion of the 2025 AGM and I am pleased to report that David Smith will be appointed Chairman in my place.

The Board looks forward to welcoming Shareholders to the AGM to be held at the offices of Shepherd & Wedderburn LLP, 4th floor, 1-6 Lombard Street, London EC3V 9AA at 12.30pm on Thursday, 10 July 2025. The Notice of the Annual General Meeting can be found in the Annual Report. The Board encourages Shareholders to attend or to vote using the proxy form, which can be submitted to the Company's registrars, Computershare Investor Services PLC, The Pavilions, Bridgewater Road, Bristol BS99 6ZY. Proxy forms should be completed and returned in accordance with instructions thereon and the latest time for the receipt of proxy forms is 12.30pm on 8 July 2025. Proxy votes can also be submitted by Crest or online using the registrar's Share Portal Service at investorcentre.co.uk/eproxy.

John Kay

Chairman

10 June 2025

VIP property portfolio - sector weightings since 2014

Manager's Report

The property market

UK commercial property capital values, as measured by the MSCI UK Quarterly Property Index, the main benchmark for institutional property performance, were just ahead by 0.4% on average over 2024 as a whole, after two years of steep declines. Including rental income, the total return was +5.5%. But capital values still fell by 5% on average for the office sector, with 0% - 2% declines in the alternatives sector, offset by capital gains averaging 2% for retail property and 4% for industrials.

MSCI UK Quarterly Property Index

Retail and industrial property outperformed the market, but for different reasons: retail had the highest income yield, while industrials showed better capital growth. Capital values in the alternatives sector generally stabilised over the year, while office capital values kept falling, with rising vacancies eroding total rents received on office property portfolios.

The property market has continued to edge higher overall from its post-downturn low point last June, but President Trump's first quarter in the White House is now making buyers nervous in property, as in other markets. Turnover has, therefore, been low, with occasional keen yields achieved for flavour of the month investments which tick every box for the few active institutional investors. Some private equity houses are targeting big corporate deals at a discount, mainly in the industrial sector. But most of the market is thin and cautious at present.

% changes by sector peak to trough and recovery since

UK commercial property - % growth rates to March 2025

Source: MSCI UK Quarterly Property Index March 2025 - Standing Investments

Underlying rental values are still generally improving, led by industrials, with all sectors showing some growth.

Comparative investment yields - End December (except 2025 end March)

Source: MSCI UK Quarterly Property Index and ONS for the RPI

The All Property vacancy rate has seen a significant increase over the past year to an all time high of 12.4% in February 2024. The previous high was 10.7% in November 2009 in the wake of the Global Financial Crisis. This is mainly due to office vacancies more than doubling to 26.0% from 12.0% in December 2019 pre-Covid, but industrial vacancies have also risen over the year from 6.7% to 9.6% to near record levels.

UK commercial property, with its high running yield and growing rental income, offers fair value against UK equities and conventional fixed-coupon gilts, and excellent value against index-linked gilts, which still only offer low real returns at considerable capital risk, as shown by their performance since 2021.

Property portfolios with strong tenants, paying affordable rents on long, preferably indexed leases for sustainable buildings in prosperous locations should continue to outperform. Weaker or ex-growth properties need to be weeded out and portfolio quality upgraded by new, stronger purchases and improvements to existing properties. Secure and sustainable growing income will be the key to delivering attractive real total returns and outperforming the competition for UK commercial property portfolios in the years ahead. Safety first must be the property investor's motto, with UK inflation far from dead and US economic and foreign policy in flux.

Property prospects by sector

Industrial: Pressures building amid a "cautiously optimistic" environment

Investor enthusiasm failed to translate to significant transaction volumes in Q1 2025; only a few larger core assets traded. 2024 transaction volumes totalled £11.1bn, slightly up on 2023's levels but still way below the sector's glory years of 2021 and 2022 and marginally below the 10-year average. Capital values increased by 1.0% for the three months to March 2025 for all industrials in the MSCI UK Monthly Property Index and by 5.0% for the 12 month period.

The occupational market is weakening. Large, big box distribution units recorded take up in 2024 of 21.2m sq ft, 33% below the five-year average, and the industrial vacancy rate increased again to 9.0% in the MSCI UK Monthly Property Index at end March 2025. This was up again, 2.1% over the 12 months from March 2024 (6.9%) and almost double the record low of 5.2% in October 2021. Industrial vacancy rates were last recorded above 9% in the first half of 2013.

Occupiers are reacting to rising labour and increasing occupational costs. Given the rental growth of recent years, industrial will be the hardest hit sector after the rates rise in April 2025 and occupiers are now consolidating their property holdings and exiting any surplus or out of date space, which no longer works for them physically or environmentally.

The sector's estimated future rental growth has decelerated and market forecasts are now 3% p.a. and 4% p.a. for the next five years. These forecasts are too high and will only reduce further with occupiers' affordability concerns. Rental value growth in the MSCI UK Annual Index has run at an average of 2.8% per annum over the last 20 years, and 5.6% over the past 10.

These records are skewed by the post Covid boom in industrial and warehouse rents in 2021 and 2022, which both saw growth over 10%.

Incentives, offered as an inducement to take a new lease, are also increasing - another sign of a weakening occupational market. A tenant taking a new 10 year lease in 2023 would have received an average of eight months' rent free (10 months' today). In addition, capital contributions are increasing. Industrial units are usually offered in a shell state for an occupier to fit out at their cost with a landlord providing a small financial incentive if demanded. Average fit out costs for industrial are c.£60 per sq ft, which is now a prohibitive cost for many occupiers. Prologis, the industrial investor, for example, has had to "retrofit", at their cost, several of its industrial units to attract occupiers.

In summary, the industrial property market is now fighting headwinds as occupiers grapple with increasing costs and investors face up to tenant insolvency risk, rising void rates and uninspiring future rental growth. Those investors who have been buying into the sector on the back of aggressive rental growth and limited vacancy assumptions should be concerned. We remain cautious for 2025 - investment volumes will stay flat, yields for the more secondary stock could well expand a little, and income growth, the traditional driver of performance under this stagnant backdrop, will be dull.

Despite these short-term indicators, to be expected during a downturn in a property cycle, there is still a solid argument for UK industrial property for the medium to long term. The sector's fundamentals are strong: rents are still growing, land values in the South in particular will be underpined by residential demand and global supply pressures could signal more onshoring and increased occupational take up. There is still strong pent-up demand from UK and overseas investors for the sector, which will drive values up again when confidence returns.

Offices: The outlier - values still falling with market activity at an all-time low

Office transaction volumes remained well below the long run averages for the sector with the UK office market achieving a record annual low in 2024 at £9.7bn, 52% below the 10-year average. Within that, the City of London market, usually held up during down cycles by larger lot sizes trading, had the lowest annual transaction volume since 1989 at £2.3 bn, significantly down on 2023 and 65% below the five-year average of c.£6bn. The few properties trading are either super prime or much smaller lot sizes for conversions to leisure / residential uses. Office capital values are still falling. The MSCI UK Monthly Property Index recorded no growth over the month to end March 2025, -3.1% over the 12-month period and -12.5% per annum over three years.

Vacancy rates have hit an all-time high at 26%. Annual take-up for the sector for 2024 was 10.8 million sq ft, below the sector's 10-year average. Occupiers who require more than 100,000 sq ft of space would normally commit to space at least 24 months prior to need, yet pre letting activity was at a three-year low last year. These occupiers are either downsizing or deferring their costly move and negotiating lower rates on their current space with their desperate landlord.

Some landlords are hoping occupancy rates will improve as the "return to the office" gathers momentum throughout 2025 but occupier costs have increased again with the business rates increase in April 2025. It is estimated that the office sector will have almost £700 million added to its annual business rates bill and larger premises may see at least a 20% increase. Occupiers will either delay any property decisions and take-up will fall further or they will be prompted to vacate space sooner and the vacancy rate will rise more.

One of the UK's largest office landlords, Land Securities, have announced the sale of c. £2bn worth of key office investments to rebalance their portfolio with more retail and residential. Other major office investors such as British Land are expected to follow suit. The traditional investors are no longer interested in the sector.

We just cannot envisage the office sector again becoming the mainstream player it once was for the foreseeable future. The economic backdrop only makes the sector look even more unattractive and not the "safe haven" investors seek out. The only way the sector could gain any traction is if capital and rental values fall further to stimulate demand.

Retail - An under the radar resurgence

Retailers have to navigate challenging market conditions with persisting inflation, low consumer confidence and low retail sales volumes. But activity levels across prime retail markets remained surprisingly resilient throughout 2024, with valuers reporting modest rental growth in some places. In recent years most investors have passed the sector over, with many expecting the adoption of online shopping to continue eating away at the need for physical retail spaces. Some retailers have upsized, opened flagship stores, plus there have been new international brands entering the UK in 2024. Retailer distress is at historic lows, vacancy rates are broadly stable, and while a few big names have tumbled - Ted Baker, The Body Shop, Carpetright and Homebase - 2024 has been relatively uneventful for closures, but WH Smith and Poundland now have doubtful futures.

Values and pricing levels have been relatively stable on the high street as there has been no real market evidence, but the out of town sector has been more active. Retail investment volumes have slowed down with the February figure below the five-year monthly average of £680m. The year-to-date total of £620m is 40% below the corresponding 2024 figure. In one of February's largest transactions, Tesco bought back its Newmarket store from Supermarket Income REIT for £64m at a 5.5% yield.

However, over the twelve months to March 2025, retail was the best performing sector on the MSCI UK Monthly Property Index with a total return of 11.4% v 8.5% for All Property driven by a high income return of 7.2% (All Property 5.9%) and capital growth (3.9% v 2.5%). This is despite retail rental value growth at 1.8% underperforming All Property at 3.4%.

High Street and Shopping Centres: While retail sales volumes remain subdued, a sustained focus on re-aligning retail footprints to match post-Covid shopping habits has helped return confidence to the occupational market. High street retail has been evolving where it is now more Leisure and Food & Beverage focused. The top centres continue to attract significant interest from large multi-national retailers and leading brands, whilst improving levels of footfall are helping to attract new occupiers. According to MSCI, the vacancy rate for institutionally held shopping centres, representing a broad range of asset sizes and qualities, contracted during 2024 falling to 11.1% of floorspace. For best-in-class locations void levels have continued to reduce. The shopping centre market saw some recovery during 2024, with total volumes exceeding £2bn as a result of over 40 deals, with the bulk being UK institutions buying out partners in the larger regional centres. In Q1 2025, several centres have been brought to the market as investors are attracted by the high income returns. Investor demand for the high street, even in strong south east locations, remains very limited with most transactions only taking place at double figure yields.

Supermarkets: Supermarket performance during 2024 was driven by income return with only modest capital growth. There continues to be a lack of quality stock being brought to the market with strong institutional demand for the £20m to £40m lot sizes let to Tesco and Sainsbury's and smaller stores let to Marks & Spencer, Aldi and Lidl. Investor sentiment towards Asda and Morrisons continues to be weak.

Aldi's sales grew by 5.6% year on year in the 12 weeks to 23 March, pushing its market share to 11% for the first time, up from 10.7%. Lidl's sales grew by 9.1% in the same period, pushing its market share to 7.8%, up from 7.4% a year ago. Lidl attracted 385,000 additional shoppers last month, more than any other grocer, and saw a double-digit rise in footfall.

M&S sales grew the fastest, with spend on groceries in its stores increasing by 13.1%, and to a 3.7% market share before it suffered a serious cyber attack in May 2025. Its online partner, Ocado, increased sales by 11.2%, to take a 2% share of the market for the first time. Tesco grew sales by 5.4%, taking its share to 27.9%, up from 27.3% last year. Sainsbury's sales were up 4.1% year on year, taking its share to 15.2%, up from 15.1%.

Asda's market share continued to drop from 13.6% to 12.5%. Executive chairman Allan Leighton recently promised significant investment in prices and stores to tempt shoppers back. Sainsbury's and Morrisons have both announced in store café closures as part of cost cutting exercises.

Out of Town Retail: Inflationary pressures and a focus on value from households have helped many operators within the out of town market. During 2024 the sector saw continued exposure to business failures which included both Homebase and Carpetright (competitors such as The Range and Tapi absorbed a significant amount of space).

Despite this, retail warehousing generated the highest total returns of all property sectors during 2024, +12.2% due to strong capital value growth, compared to supermarkets +6.9%, shopping centres +8.2% and shops +3.3%. £1.3bn of retail warehouse transactions (33 deals) completed in Q4 2024 pushing yields down. Purchasers were mainly listed and private property companies attracted by low vacancy rates and strong occupier demand. The momentum for this sector has continued into 2025. According to MSCI, the vacancy rate for institutionally held retail parks increased marginally during 2024 up to 4% from 3.7% at the end of 2023. The final quarter of 2024 saw over £1.6bn transact, contributing over 50% of total annual investment volumes and marking the largest single quarterly volume recorded in recent history. British Land, Realty Income and Redevco were the major players during the year, accounting for a significant proportion of activity, and reaffirming appetite from institutional capital for the sector.

Alternatives - Defensive assets let on long leases to strong tenants at realistic rents are outperforming

Assets outside the traditional office, retail, and industrial sectors now account for 25% of the MSCI UK Quarterly Property Index, compared to 22% for offices, 18% for retail, and 35% for industrial. Properties in the 'Alternatives' sector are often seen as defensive, featuring long, index-linked leases and a diverse range of tenants, making them attractive in uncertain market conditions.

The alternatives sector accounted for the largest share of Q4 2024 investment volumes at 39%, but the 'cautious optimism' felt at the beginning of that quarter has been tempered by the higher National Insurance contributions, increases in the National Living Wage and rising business rates. The Government's decision to freeze the standard rates multiplier to increase with inflation and to cut hospitality and leisure rates relief from 75% to 40% will see many business rates bills rise by 140% in April, or even higher. Businesses are looking at ways to mitigate these costs, some will fail in the short term, while others will likely reduce staff and increase costs to the consumer as they try to keep their heads above the water. Investment appetite has slowed in Q1 2025, and transaction volumes across all sectors are down. (-37% in February 2025 v's February 2024).

High-quality, well-let assets, particularly those in the £1m-£3m lot size range, are still attracting interest, particularly from private investors and property companies, but buyers are increasingly selective and demanding higher risk premiums. The focus is more than ever on covenant strength, affordability of rents, income growth and future alternative use value.

Pubs and Restaurants: In December 2024, UK pubs and restaurants saw a welcome sales boost, marking a strong finish to the year. This growth was driven by festive celebrations and the resulting uptick in consumer spending, especially in London. However, the hospitality sector continues to face considerable challenges, with many closures, mainly of smaller pubs, attributed to rising operational costs and more cautious consumer spending. In April, when rate bills rise, restaurants will see their annual bills increase from an average of £5,563 to £13,351, with pubs similarly affected. Independent and privately-backed pubs and restaurants are struggling the most.

Well-managed operators with strong cash flows, such as Greene King, Wetherspoons, Fullers, Youngs, and Shepherd Neame, are better positioned to weather these cost pressures. However, even these industry leaders will face increasingly narrow margins post- April. In its recent interim results, Wetherspoons projected that rising labour costs and National Insurance contributions would add around £60m to its annual costs. Shepherd Neame, despite reporting a strong second half-year performance with operating profits up by 7.4%, warned of a 'challenging market' and rising 'unwelcome' costs, which it plans to address through a combination of price hikes and cost efficiencies. Pubs let on long leases to strong tenants remain attractive to investors, though yields have moved out and are under pressure for assets where covenants look uncertain, and rents have grown too high too fast.

Bowling: As one of the most affordable family-friendly outings, bowling continues to attract diverse income groups. The dominant market leaders, Hollywood Bowl and Ten Entertainment (Tenpin) are still performing strongly. These operators are focusing on value-for-money, multiple-concept experiences and site refurbishments. The bowling sector presents an opportunity for specialist investors to acquire long-let, index-linked leases at high yields, with rents often below neighbouring retail warehouses or industrial properties, but future alternative use value does now need to underpin investment value to access the widest possible market.

Budget Hotels and Caravan Parks: Budget hotels, particularly Premier Inn (Whitbread), have benefited from a cost-conscious consumer. Despite operational challenges affecting profits, investor interest in long-let, index-linked hotel investments rose significantly in 2024 with transaction volumes in this sector double those of 2023, marking the highest level since 2019. While volumes slowed in Q4 2024, total returns for the 12 months to March 2025 stood at +9.7%. Transactions in Q1 2025 have been limited and yields have moved out slightly, particularly where unexpired terms have shortened. Caravan Parks are also facing higher overheads, most notably in staffing and employment costs. 2024 had lower than typical transaction volumes with fewer active buyers and a lack of supply, with more operators choosing to sit on their hands. The proposed change to Business and Agricultural Property Relief has already focussed the minds of some operators looking towards succession, which may affect supply over the next few years.

Garden Centres: Some garden centre operators, such as Dobbies, have struggled with over-expansion, unseasonal weather, and excess stock. However, well-financed operators like Blue Diamond, the UK's leading garden centre group, are thriving and expanding through their own sale and leaseback programmes. The sector is undergoing consolidation, with smaller or less profitable centres being acquired by strong operators. Larger, profitable garden centres with valuable sites and future alternative use potential continue to attract investor interest.

Student Accommodation: Investment in student accommodation reached over £3.8bn in 2024, an increase of 14% on the previous year, but Q4 2024 volumes were down as yields rose and capital values came under pressure from rising bond yields - there has been very little trade so far in 2025. Growth over the past few years has been fuelled by the substantial deployment of capital into a sector underpinned by robust student demand, long term income streams, strong annual rental growth and limited supply, but there are occupancy challenges. Some operators have increased rents above what students can afford, increasing voids. There has also been a notable decrease in international student numbers (applications for study visas were down 17% in 2024 v's 2023). Strategic partnerships between universities and developers are a viable solution to address financial pressures and housing shortages, so long as the planners play ball and university finances permit. When properties let to notable universities on long index-linked leases do come to market, there is stiff competition.

The economy

The British economy has suffered four severe shocks over the past ten years - Brexit, COVID, the war in Ukraine and now Trump, so economic forecasting is even more "art" than "science". Unquantifiable uncertainty abounds, and our basic economic statistics, from average earnings to employment to wholesale prices, have broken down as they have failed to cope with post-COVID changes in working patterns and falling survey response rates. So the Treasury and the Office of Budget Responsibility, like all forecasters, are flying almost blind through thick fog.

Unlike most other Western economies, the UK is still trying to adjust to major changes in our pattern of exports and imports with the European Union (with half our overseas trade against less than 20% for the USA). And the UK's legacy of high public debt post -COVID, with financially stretched public services and a fast-growing interest bill on our short-dated Government borrowings, meant that in her Spring Statement on 26 March, the Chancellor looked to be walking a tightrope while wearing a straitjacket.

UK 10 year gilt yields have been highly volatile but shown little net change over the past two years, rising from 4.5% to 4.6% over 2024 and to 4.7% at end March 2025. International yield movements were the key driver. UK gilts traded generally around 4% for much of 2024, but then rose to 4.6% after the UK Autumn Budget and President Trump's re-election in November. They are now getting some support from international investors' aversion to America.

Consumer price inflation is not going to fall back sustainably to the Bank of England's official 2% target any time soon. The annual rate of increase of the CPI dipped below 3% early in 2025 but may be back to 4% over the summer. Water, energy and council tax bills rose sharply on 1 April, and employers will pass on in prices what they can of the continuing increases in the National Minimum Wage (9.8% in April 2024 and 6.7% in April 2025 for adults and up to 21.2% and 16.3% for young workers) and the increases in employers' national insurance contributions. The Chancellor had no real alternative to raising employers' national insurance, being boxed in by commitments not to raise other taxes; but lowering the starting point from £9,100 to £5,000 meant the cost burden fell most heavily on employers of large numbers of low paid and part-time workers. As well as the likely loss of part-time job opportunities for people on the edge of unemployment, the extra cost has fallen heavily on consumer-facing retail, leisure and hospitality businesses whose increased prices will show up quickly and clearly in the consumer price indices.

Unemployment may rise slightly this year; after that it will depend on whether the Spring Statement's benefit and welfare changes bring more people into work as hoped.

More generally, consumer price inflation will stay above the official 2% target if productivity and GDP per head grow around 1% a year over the next four years, while average earnings and service sector inflation stay near their present 5% annual growth rates. Even with the Government's oft-repeated commitment to growth, 3% still looks a more realistic central forecast for annual UK CPI growth than 2% over the next few years. And it may be even higher in a world of tariffs and trade shocks. So the Monetary Policy Committee of the Bank of England needs to tread carefully in cutting short term interest rates from the current 4.25%.

The Chancellor's redefinition of public sector debt in the Autumn Budget has enabled public sector net investment to rise to average 2.6% of GDP over the next five years. Part of the increase in defence spending to 2.5% of GDP in 2027, and then to 3% when resources allow, will be achieved through capital projects. But the severe cut to 0.3% of GDP in the overseas aid budget comes from current spending.

Housing, after many years of policy neglect under all Governments, provided the main bright spot in the OBR analysis of Britain's public finances and growth prospects. The new Government's commitment to build 1.5 million homes over the next 5 years is unrealistic, starting from a base of only 200,000 a year. But the OBR, and many experts, do now believe the Government's policy changes make 300,000 homes a year achievable by 2029-30. These include the National Policy Planning Framework and a strengthened presumption in favour of development, increased social housebuilding and improved productivity. Mortgage rates are still adjusting to higher levels (from an average of 3.7% to 4.7% in 2028 as lower fixed rates run off). High land prices are still the main difference between housing costs in the UK and comparable countries, so compulsory purchase of land for affordable housebuilding at existing use values could make a real difference here.

Since 2021, house prices in England and Wales have increased by 1%, while average earnings have risen 20 per cent. But, typical mortgage rates have risen from 2% to 4%-5%. House prices are particularly unaffordable in London and south east England, where real house prices, especially at the higher end of the market are overvalued and have further to fall. But lower priced homes in other regions are now more realistically valued, especially by comparison with renting.

Raising Britain's poor relative rates of investment and particularly growth will be a long, hard but not impossible slog. Most British businesses are in reasonable financial health, household savings rates at 10% are relatively high and the economy is still growing through all the headwinds. But confidence is low. British pension funds and private investors have run their holdings in productive UK assets - ranging from quoted shares to unlisted direct property and wider infrastructure - right down over the past 25 years so foreign buyers are snapping them up from the bargain basement. Boosting British business and the London Stock Exchange by focussing ISA tax relief just on UK investments could shake off the gloom and save British taxpayers' cash by stopping subsidising our competitors' shares around the world. Tesla needs no British tax breaks.

The outlook for the world economy had been improving at the end of 2024. But, the International Monetary Fund have now cut their forecasts for GDP growth in the USA to 1.8%, in 2025 and 1.7% in 2026, with growth in the Euro area and UK around 1% in both years with China at 4% and India at 6%. These could still be too high, especially if the USA tariff confrontation with China drags on.

Frequent, unexpected and erratic changes in public policy by the new US Administration, from cuts in public spending and employment at home, to stopping the US Aid programme across the world, are undermining investor, business and consumer confidence in America. The almost complete reversal of US support for Ukraine, its half-hearted (at best) commitment to NATO and open hostility to the European Union, have already led the new German government to raise the roof on defence spending and investment. Seen from London, the Atlantic looks wider and the English Channel much narrower than at any time since 2016 and the Euro will grow as a reserve currency.

President Trump may modify or draw back from some of his more extreme demands, but investors in all markets would be wise to assume that the world is now a more dangerous place for the next few years and stick to safe, income-producing investments, avoiding over concentration on the USA. The White House will also be actively hostile to action on climate change, both directly at the inter-governmental level and indirectly by its hostility to investors' growing efforts in recent years to make business prioritise the environment.

Economic policymakers and investors alike have to manage as best they can in these turbulent times with a consistent concentration on sustainable growth and security. But upheavals always bring opportunities. Over the past 50 years in Britain, the best long term investments have usually been made under dark skies before the gloom starts to lift.

Annual portfolio summary

VIP specialises in direct investment in UK commercial properties with long, strong, index-related income streams to deliver above average long term real returns.

The portfolio comprises 30 properties across seven well diversified sub-sectors, fully let on 32 full repairing and insuring leases (WAULT 13.3 years to the tenants' option to break) to 18 different tenant covenants across England and Scotland, with 79% of rents coming from the top ten tenants. Following the sale of the long leasehold Doncaster property on 24 April 2025, post the year end, all properties are freehold.

Index-related rent reviews

The current rental income on the whole portfolio stands at £9.8 million per annum. 100% has either index-linked or fixed increases.

Over the financial year, 9 rent reviews completed representing 29.3% of the rent roll, with an average annual increase of 3.0% on their rents passing. This added £0.1 million (1.2%) to all held properties. Six were RPI-linked annual reviews, two had five yearly RPI-linked reviews and one had an annual fixed increase of 2.0%. The two rent concessions at Brentwood and York also ended in the year, increasing the rent passing from these two properties by 29.8%, which added a further £0.2 million to the portfolio's rental income.

There are 32 leases, which are reviewed with either RPI-linked (88%), CPI-linked (9%) or fixed increases (3%). There are no longer any properties with open market rent reviews.

Eight tenancies representing 29% (year ended 31 March 2025) of the rental income have annual rent reviews and 24 (71%) have five yearly reviews. Over the next five years, the following percentage of rental income will be reviewed in each financial year, based on the portfolio as at 31 March 2025.

Over the next 12 months, 18 tenancies, representing 69% of the total rent, will undergo a rent review.

Of the index-related rents within the portfolio; 68% of the RPI-linked and CPI-linked rents are subject to collared uplifts, which average 1.6% per annum and 89% are subject to capped uplifts, which average 3.8% per annum. 9% of the total indexed income has uncapped RPI increases. Fixed rent review uplifts average 2.3% per annum.

Purchases and sales

One purchase for £16.5 million and six sales for £12.4 million completed over the year.

Purchases completed

Garden Centre - Bridgemere Garden Centre, near Nantwich (Cheshire). The purchase of a long-let Garden Centre investment on a 36.5 acre site with indexed income completed in August 2024 at a purchase price of £16.5 million at a net initial yield of 6.6%, rising to an estimated 7.8% in December 2025. It is let to Blue Diamond Limited on a full repairing and insuring lease without break to 2049 (WAULT of 24 years) with five yearly rental increases in line with the Retail Prices Index (RPI), capped at 4% p.a. and collared at 1% p.a.

Sales completed

The sale of six properties completed during the year for £12.4 million, 5.0% above valuation at an average net yield of 7.4%. These were four shorter let industrial properties at Dundee (let to Screwfix), Staines and Thurrock (let to Halfords) and the unindexed, leasehold Fareham (let to the Local Authority), the shorter let library and convenience store at Risca (let to Caerphilly Council and Tesco), and an overrented long let London pub, which was sold to the tenant, Shepherd Neame.

Sales exchanged / completed since 31 March 2025

Contracts were exchanged in March 2025 for the sale of the leasehold bowling alley in Doncaster at valuation and at a net sale yield of 8.4%, and the sale completed on 24 April 2025.

The purchases and sales increased the portfolio's weighted average unexpired lease term to break to 13.3 years from 11.6 years (March 2024).

The sales proceeds were used towards the purchase of the Bridgemere Garden Centre and for partial repayment of a £15 million loan expiring in March 2026. £6 million of this loan was repaid on 31 January 2025 and £4 million post the year end on 30 April 2025.

Rent collection

100% of all rents were collected during the year to 31 March 2025. The top ten tenants have 22 leases: Marks & Spencer, Blue Diamond, Ten Entertainment Group, Premier Inn, Sainsbury's, Park Resorts, HM Government, Virgin Active, Co-operative Group and Hollywood Bowl.

One of the smaller tenants in part of the Bowling complex in Coventry, Pizza Hut, entered into administration in January 2025. The company was bought out of administration by DC London Pie Ltd, to whom the lease was assigned. The unit is still trading as a Pizza Hut restaurant and all rents due have been collected.

Fully let

The portfolio is fully let, with no voids (MSCI UK Monthly Property Index void rate: 12.1%).

Responsible impact based ESG management

OLIM Property has always taken a cautious and responsible approach to managing VIP's property portfolio, with environmental impact, social responsibility and governance (ESG) taken fully into account in selecting high quality properties and suitable tenants for acquisition, long term management and disposal. Occupier relationships are crucial. We engage with our tenants to understand and establish sustainable rental levels and grow future income streams, working closely with them to address value add energy performance targets.

All VIP's properties are regularly reviewed, ESG improvements implemented at appropriate asset management stages and properties, such as Fareham, sold where performance may be negatively impacted by ESG factors.

Energy Performance Certificates (EPCs)

100% of the properties now have an EPC rating A-C (up from 64% in 2022). We continue to work with our tenants to upgrade properties and improve EPC ratings.

Top 10 properties by capital value

Performance and independent revaluation

Savills' independent valuation at 31 March 2025 on all 30 properties totalled £146,000,000, as detailed in Note 9 to the Financial Statements in the Annual Report, reflecting a net initial yield of 6.3% after deducting notional purchase costs (31 March 2024: 6.6%, 30 September 2024: 6.4%). The valuation totals at 31 March 2024 were £138,100,000 and at 30 September 2024 (half-year) £146,150,000.

On a like for like basis, excluding purchases and sales, the portfolio's capital value increased by 1.1% in the first half of the year and by 1.0% in the second.

All sectors in the portfolio gained in value, over the year except the pubs, the health club and caravan park which were unchanged. The properties held within the industrial / warehouse sector gained in value by 2.5% over the 12 months to March 2025, the supermarket sector also increased by 4.1% over the year. Each of the bowling and hotel sectors increased by 0.8%.

Spot annualised rental income at the year end rose to £9.8 million against £9.7 million a year before, despite sales, due mainly to rent increases over the year delivering rental growth of 3.2% on all held properties. There are no empty properties.

The property portfolio has been further upgraded and its weighted average unexpired lease term improved with the sale of six shorter let properties, which completed for £12.4 million (four industrials, a library and convenience store and an over-rented London pub) with the net sale proceeds partly reinvested into the purchase of the long-let Garden Centre in Nantwich for £16.5 million with an RPI-linked lease.

The property portfolio produced a total return of 4.8% over the past six months and 9.0% over the past year to March, against 3.5% and 6.3% for the MSCI UK Quarterly Property Index, the main benchmark for commercial property performance. The portfolio's main drivers of out performance were an above average income yield and on the capital front, no offices or high street shops.

The returns on VIP's property portfolio have been above the MSCI averages by between 1.8% and 3.0% a year over 1, 5, 10, 20 and 38 years. The real returns were behind the Retail Prices Index over last year and three and five years but well above it over longer periods, with a real total return of over 7.0% a year over 38 years since the inception of OLIM's management.

Sarah Martin, Matthew Oakeshott and Louise Cleary

OLIM Property Limited

10 June 2025

Business Review

This Business Review is intended to provide an overview of the strategy and business model of the Company, as well as the key measures used by the Directors in overseeing its management. During the year to 31 March 2025, the Company operated as an investment trust company that invested in accordance with the investment objective and investment policy outlined in the Business Review. The Company entered the UK REIT regime on 1 April 2025 following Shareholders' approval of amendments to the Articles of Association at the General Meeting of the Company held on 20 March 2025.

Value and Indexed Property Income Trust PLC's (VIP or the Company) Ordinary Shares are listed on the Official List and traded on the Main Market of the London Stock Exchange. The Company is registered as a public limited company in Scotland under company number SC050366 and is an investment company within the meaning of Section 833 of the Companies Act 2006. The Company has one class of share. VIP is a member of the Association of Investment Companies (AIC).

The Group

During the year under review, Value and Indexed Property Income Services Limited (VIS), a wholly owned subsidiary of the Company, was authorised by the Financial Conduct Authority (FCA) to act as the Company's Alternative Investment Fund Manager (AIFM).

VIS delegated its portfolio management responsibilities to OLIM Property Limited (OLIM Property), the Investment Manager responsible for managing the property portfolio. With effect from 8 September 2024, the Company appointed OLIM Property as its AIFM, in place of VIS, with no change to the portfolio management or fee arrangements.

Capital structure

As at 31 March 2025, and as at the date of the Annual Report, VIP's issued share capital comprised 45,549,975 Ordinary Shares of 10p each of which 3,536,939 Ordinary Shares of 10p were held in Treasury. Each Ordinary Share in issue entitles the holder to one vote on a show of hands and, on a poll, to one vote for every share held and, therefore, the total number of voting rights in the Company as at the date of the Annual Report was 42,013,036.

Share dealing

Shares in VIP can be purchased and sold in the market through a stockbroker or regulated investment platform, or indirectly through a lawyer, accountant or other professional adviser. Further information on how to invest in VIP is detailed in the Annual Report.

Recommendation of non-mainstream investment products

VIP currently conducts its affairs so that the shares issued by it can be recommended by independent financial advisers to ordinary retail investors in accordance with the rules of the FCA in relation to non-mainstream investment products and intends to do so for the foreseeable future. VIP's shares are excluded from the FCA's restrictions, which apply to non-mainstream investment products, because they are shares in an investment trust company. The returns to investors are based on investments in directly held property.

Summary of the year

• Net Asset Value total return* of 7.1% (2024: -9.7%) over one year and -16.8% (2024: -10.2%) over three years.

• Share Price total return* of 15.0% (2024: -10.3%) over one year and -6.3% (2024: -3.2%) over three years.

• MSCI UK Quarterly Property Index total return of 6.3% over one year (2024: -1.1%) and -2.9% (2024: 1.2%) over three years.

• Dividends for the year up 4.5% - the 38th consecutive year of dividend increases.

• Dividend yield at 31 March 2025 of 7.5% (2024: 7.7%).

Financial record

* This is an Alternative Performance Measure (APM) which has been explained in the Glossary in the Annual Report.

** The 2022 and 2023 Financial Statements were restated to correct an error in the calculation of the operating lease asset brought

forward.

Investment objective and investment policy

Investment objective

The Company invests directly in UK commercial property to deliver long, strong, index-related income. The Company aims to achieve long-term, real growth in dividends and capital value without undue risk.

Investment policy

The Company's policy is to invest in directly held UK commercial property and cash or near cash securities. UK directly held commercial property will usually account for at least 80% of the total portfolio but it may fall below that level if relative market levels and investment value, or a desired increase in cash or near cash securities, make it appropriate. The Company will not use derivatives.

The Company is permitted to invest cash held for working capital purposes pending re-investment in cash deposits, gilts and money market funds.

The UK commercial property portfolio

The Company will target secure income and capital returns linked to inflation, mainly through its diversified portfolio of UK property assets, let or pre-let to a broad range of strong tenants on long leases with rental growth subject to index-related or fixed increases. The Company has not set any geographical limits, except that it may invest in all four nations of the United Kingdom. It has also set no structural limits and expects the portfolio to be focused on (but not limited to), the industrial/warehouse, supermarket, roadside and leisure sectors (including for example, caravan parks, pubs, hotels, garden and bowling centres) income strips and ground rents. Offices and high street retail properties would not be priority sectors for investment. In order to manage risk in the portfolio, at the time of purchase, no single property asset will exceed in value 25% of the Company's gross asset value and no single tenant (except UK Government and public sector) will account for more than 30% of the Company's total rental income.

Borrowing policy

The Company has a longstanding policy of funding most of the increases in its property portfolio through the judicious use of borrowings. Gearing will normally be within a range of 25% and 50% of the total portfolio. The Company will not raise new borrowings if total net borrowings would then represent more than 50% of the total assets.

Detail of the Company's current borrowings, comprising two fixed term secured loan facilities can be found in Notes 11 and 12 to the Financial Statements in the Annual Report.

Performance, results and dividend

As at 31 March 2025, the Net Asset Value (NAV) total return over one year was 7.1% and the Share Price total return over one year was 15.0%. This compares to the MSCI UK Quarterly Property Index total return of 6.3%. Total assets less current liabilities were £139.2 million. A review of the performance of the property portfolio is detailed in the Chairman's Statement and in the Manager's Report in the Annual Report.

For the year to 31 March 2025, quarterly dividends of 3.4p per share were paid as Ordinary Dividends on 25 October 2024, 31 January 2025 and 25 April 2025, respectively. The Directors have declared a final dividend of 3.6p per Ordinary Share (2024: 3.6p) which, if approved by Shareholders at the 2025 AGM, will be paid on, or around, 25 July 2025 to Shareholders on the register on 27 June 2025. The ex-dividend date is 26 June 2025. This final dividend will be paid as a Property Income Distribution (PID). This represents an annual increase in dividends of 4.5% as compared with the 3.2% and 3.4% annual increases in the Retail Prices and Consumer Prices (including Housing) Indices, respectively, as at the end of March 2025.

Principal and emerging risks and uncertainties

The Board has an ongoing process for identifying, evaluating and monitoring the principal and emerging risks and uncertainties facing the Group and the Parent Company. The risk register forms a key part of the Group and the Parent Company's risk management framework used to carry out a robust assessment of the risks, including a significant focus on the controls in place to mitigate them. The principal and emerging risks and uncertainties which affect the Group's and the Company's business are:

Property risk

The Group's commercial property portfolio is subject to both market and specific property risk. Since the UK commercial property market has been markedly cyclical for many years, it is prudent to expect that to continue.

The price and availability of credit, real economic growth, and the constraints on the development of new property, are the main influences on the property investment market.

Against that background, the specific risks to the income from the portfolio are tenants being unable to pay their rents and other charges or leaving their properties at the end of their leases.

All investment properties held by the Group are commercial properties located in the UK, mainly with long-term, index-related income streams.

All leases are on full repairing and insuring terms, with upward only rent reviews, and the weighted average unexpired lease length to the break option is 13.3 years. Details of the tenant and geographical spread of the portfolio are set out in the Annual Report. The long-term performance record through the varying property cycles since 1987 is set out in the Annual Report. OLIM Property is responsible for property investment management, with surveyors, solicitors and managing agents acting on the portfolio under OLIM Property's supervision.

Market risk

The fair value of, or future cash flows from, a financial instrument held by the Group may fluctuate because of changes in market prices. This market risk comprises two elements - price risk and interest rate risk.

Price risk

Changes in market prices (other than those arising from interest rate or currency risk) may affect the value of the Group's investments.

Interest rate risk

Interest rate movements may affect:

• the fair value of the investments in property;

• the level of income receivable on cash deposits; and

• the fair value of borrowings.

The possible effects on fair value and cash flows that could arise as a result of changes in interest rates are taken into account when making investment and borrowing decisions.

The Board imposes borrowing limits to ensure that gearing levels are appropriate to market conditions and reviews these limits on a regular basis. Current borrowings comprise two secured term loans, with one and eight year terms remaining, providing secure long-term funding. It is the Board's policy to maintain a gearing level, measured on the most stringent basis of calculation after netting off cash equivalents, of between 25% and 50%.

Liquidity risk

This is the risk that the Group will encounter difficulty in meeting obligations associated with its financial liabilities.

The Group's assets comprise investment properties which, by their nature, are not readily realisable. The long maturity of the Company's mainly fixed rate borrowings helps mitigate this risk and is detailed in the Annual Report and in the interest rate risk profile section of Note 21 to the Financial Statements in the Annual Report.

Political risk

Political changes that result in parties with extreme political or social agendas having power or influence over policies could lead to instability and uncertainty in the markets, legislation and the economy.

The Board reviews regularly the political situation, together with any associated changes to the economic, regulatory and legislative environment, to ensure that any risks arising are mitigated as effectively as possible.

An explanation of certain economic and financial risks and how they are managed is contained in Note 21 to the Financial Statements.

Climate change and social responsibility risk

The Board recognises that climate change is an important risk that all companies should take into consideration within their strategic planning. As referred to elsewhere in the Strategic Report and in the Governance Report in the Annual Report, the Company has little direct impact on environmental issues. All of the Company's properties are let on full repairing and insuring leases, with the tenants responsible for complying with statutory obligations. The Board is aware that the Manager continues to take into account environmental, social and governance (ESG) matters, and, in particular, Energy Performance Certificates and flood risks, in managing the portfolio. In accordance with the RICS Professional Standard 'Sustainability and ESG in commercial property valuation and strategic advice', the Savills' valuation of the Company's properties takes into consideration sustainability and ESG factors.

Economic risk

The valuation of the Company's investments may be affected by underlying economic conditions, such as fluctuating interest rates, rising inflation, increased fuel and energy costs, and the availability of bank finance. These factors can be impacted during times of geopolitical uncertainty and volatile markets, including pandemics and the ongoing wars in Ukraine and the Middle East. The Board monitors the economic and market environment closely, and believes that the diverse, well-spread, long let indexed portfolio should prove resilient.

Other key risks

Additional risks and uncertainties include:

• Discount volatility: The Company's shares may trade at a price which represents a discount to its underlying net asset value.

• Regulatory risk: The Directors strive to maintain a good understanding of the changing regulatory agenda and consider emerging issues so that appropriate changes can be implemented and developed in good time. The Group operates in a complex regulatory environment and, therefore, faces a number of regulatory risks. A breach of Section 1158 of the Corporation Tax Act 2010 would result in the Company being subject to capital gains tax on portfolio investments. Breaches of other regulations, including but not limited to, the Companies Act 2006, the FCA Listing Rules, the FCA Disclosure, Guidance and Transparency Rules, the Market Abuse Regulation, the Packaged Retail and Insurance-based Investment Products (PRIIPs) Regulation, the Second Markets in Financial Instruments Directive (MiFID II) and the General Data Protection Regulation (GDPR), could lead to a number of detrimental outcomes and reputational damage. From 1 April 2025, in order to operate as a UK REIT, the Company requires to comply with the legislation contained in Part 12 of the Corporation Tax Act 2010.

The Company is also required to comply with tax legislation under the Foreign Account Tax Compliance Act and the Common Reporting Standard. The Company has appointed its registrar, Computershare, to act on its behalf to report annually to HM Revenue & Customs (HMRC).

The Company's privacy policy is available to view on the Company's web pages hosted by the Investment Manager at www.olimproperty.co.uk/value-and-indexed-property-income-trust.html.

Breaches of controls by service providers to the Company could also lead to reputational damage or loss. The Audit and Management Engagement Committee monitors compliance with regulations by reviewing internal control reports from the Administrator and from the Investment Manager.

Alternative investment fund managers directive

The Alternative Investment Fund Managers Directive (AIFMD) introduced an authorisation and supervisory regime for all managers of authorised investment funds in the EU.

In accordance with the requirements of the AIFMD, the Company appointed VIS as its Alternative Investment Fund Manager (AIFM) and BNP Paribas London Branch as its Depositary. With effect from 8 September 2024, the Company appointed OLIM Property as its AIFM, in place of VIS, with no change to the portfolio management or fee arrangements. The Board has controls in place, in the form of regular reporting from the AIFM and the Depositary, to ensure that both are meeting their regulatory responsibilities in relation to the Company.

Key performance indicators

At each Board Meeting, the Directors consider a number of performance measures to assess the Company's success in achieving its objectives, which also enable Shareholders and prospective investors to gain an understanding of its business.

A historical record of these performance measures, with comparatives, together with the Alternative Performance Measures (APMs) are shown in the Summary of the year and Financial record section of the Business Review. Definitions of the APMs can be found in the Glossary in the Annual Report.

The Directors have identified the following as key performance indicators:

• Net asset value and share price total returns relative to the MSCI UK Quarterly Property Index (total returns); and

• Dividend growth relative to consumer price inflation.

The NAV total return is considered to be an appropriate measure of Shareholder value as it includes the current NAV per share and the sum of dividends paid to date.

The medium term dividend policy is for increases at least in line with inflation.

The Board reviews the Company's rental income and operational expenses on a quarterly basis, as the Directors consider that both of these elements are important components in the generation of Shareholder returns. Further information can be found in Notes 2 and 4 to the Financial Statements.

In addition, the Directors will consider economic, regulatory, and political trends and factors that may impact on the Company's future development and performance.

Share buy-backs

651,514 Ordinary Shares were bought back in the year to 31 March 2025 (2024: 347,914 Ordinary Shares bought back). As at 31 March 2025, 3,536,939 Ordinary Shares of 10p each were held in Treasury. As at the date of the Annual Report, no further shares had been purchased since the year end. Further information can be found in Note 14 to the Financial Statements.

At the forthcoming AGM, the Board will seek the necessary Shareholder authority to continue to conduct share buy-backs.

Statement of compliance with investment policy

The Company is adhering to its stated investment policy and managing the risks arising from it. This can be seen in various tables and charts throughout the Annual Report, and from the information provided in the Chairman's Statement and in the Manager's Report.

The Board's section 172 duty and stakeholder engagement

The Directors recognise the importance of an effective Board and its ability to discuss, review and make decisions to promote the long-term success of the Company and protect the interests of its key stakeholders. As required by Provision 5 of The AIC Code of Corporate Governance (the AIC Code) and, in line with The UK Corporate Governance Code (the Code), the Board has discussed the Directors' duty under Section 172 of the Companies Act and how the interests of key stakeholders have been considered in the Board discussions and decision making during the year. This has been summarised in the table below:

There were no other key decisions made in the year to 31 March 2025 that require to be disclosed.

Employee, environmental and human rights policy

As an investment trust company, the Company has no direct employee or environmental responsibilities, nor is it responsible for the emission of greenhouse gases. Its principal responsibility to Shareholders is to ensure that the investment portfolio is properly managed and invested. The Company has no employees and, accordingly, has no requirement to report separately on employment matters.

Management of the investment portfolio is undertaken by the Investment Manager through members of its portfolio management team. In light of the nature of the Company's business, there are no relevant human rights issues and, therefore, the Company does not have a human rights policy.

Independent auditor

The Company's Independent Auditor is required to report if there are any material inconsistencies between the content of the Strategic Report and the Financial Statements. The Independent Auditor's Report can be found in the Annual Report.

Future strategy

The Board and the Investment Manager intend to maintain the strategic policies set out above for the year ending 31 March 2026 as it is believed that these are in the best interests of Shareholders.

The Company's Viability Statement is included in the Directors' Report in the Annual Report.

Approval

This Business Review, and the Strategic Report as a whole, was approved by the Board of Directors and signed on its behalf by:

John Kay

Chairman

10 June 2025

Going concern

The Group and the Parent Company's business activities, together with the factors likely to affect their future development and performance, are set out in the Chairman's Statement and the Manager's Review, and in the Business Review, and the financial position of the Group and of the Parent Company is described in the Chairman's Statement within the Strategic Report in the Annual Report. In addition, Note 21 to the Financial Statements includes: the policies and processes for managing the financial risks; details of the financial instruments; and the exposures to market risk (price risk and interest rate risk), liquidity risk, credit risk and property risk. The Directors believe that the Group and the Parent Company are well placed to manage their business risks. As detailed in Note 11 to the Financial Statements, as at 31 March 2025, the £9 million fixed rate loan is due to be repaid, in the normal course of business, on or before 31 March 2026; £4 million of which was repaid post the year end as detailed in Note 24 to the Financial Statements.

Following a detailed review, the Directors have a reasonable expectation that the Group and the Parent Company have adequate financial resources to enable them to continue in operational existence for the foreseeable future, being at least 12 months from approval of the Financial Statements, and accordingly, they have continued to adopt the going concern basis (as set out in Note 1(b) to the Financial Statements) when preparing the Annual Report and Accounts.

Statement of Directors' Responsibilities

The Directors are responsible for preparing the Strategic Report and the Directors' Report, the Directors' Remuneration Report, the Statement of Corporate Governance, and the Financial Statements in accordance with UK adopted international accounting standards and applicable laws and regulations.

Company law requires the Directors to prepare Group and Company Financial Statements for each financial year. Under that law, the Directors are required to prepare the Group Financial Statements, and have elected to prepare the Company Financial Statements, in accordance with UK adopted international accounting standards.

The Group and Company Financial Statements are required by law and UK-adopted International Accounting Standards to present fairly the financial position of the Group and the Company and the financial performance of the Group and the Company; the Companies Act 2006 provides in relation to such financial statements that references in the relevant part of that Act to financial statements giving a true and fair view are references to their achieving a fair presentation.

Under company law, the Directors must not approve the Financial Statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and Company and of the profit or loss for the Group and Company for that period.

In preparing these Financial Statements, the Directors are required to:

• select suitable accounting policies and then apply them consistently;

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

• state whether they have been prepared in accordance with UK adopted international accounting standards, subject to any material departures disclosed and explained in the Financial Statements; and

• prepare the Financial Statements on the going concern basis unless it is inappropriate to presume that the Group and Company will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group's and Company's transactions and disclose with reasonable accuracy at any time the financial position of the Group and Company and enable them to ensure that the Financial Statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and, hence, for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Directors are responsible for ensuring the Annual Report and Financial Statements are made available on a website. Financial Statements are published on the Company's web pages hosted by the Investment Manager 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 web pages is the responsibility of the Directors. The Directors' responsibility also extends to the ongoing integrity of the Financial Statements contained therein.

Directors' responsibility statement

Each Director confirms, to the best of his or her knowledge, that:

• the Financial Statements have been prepared in accordance with the applicable set of 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 that

• the Annual Report includes a fair review of the development and performance of the business and the financial position of the Group and Company, together with a description of the principal risks and uncertainties that they face.

The Directors confirm that the Annual Report and Financial Statements taken as a whole is fair, balanced and understandable and provides the information necessary for Shareholders to assess the Group's position and performance, business model and strategy.

For and on behalf of the Board of

Value and Indexed Property Income Trust PLC

John Kay

Chairman

10 June 2025

Group Statement of Comprehensive Income

The total column of this statement represents the Statement of Comprehensive Income of the Group, prepared in accordance with IFRS. The revenue return and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. All items in the above statement derive from continuing operations.

The Group does not have any other comprehensive income and so the total profit/(loss), as disclosed above, is the same as the Group's total comprehensive income. All income is attributable to the equity holders of Value and Indexed Property Income Trust PLC, the parent company. There are no non-controlling interests.

The Board is proposing a final dividend of 3.6p per share, making total dividends of 13.8p per Ordinary Share for the year to 31 March 2025 (2024: 13.2p per Ordinary Share) which, if approved by Shareholders, will be payable on 25 July 2025 (see Note 8).

The Notes form part of these Financial Statements.

Company Statement of Comprehensive Income

The total column of this statement represents the Statement of Comprehensive Income of the Company prepared in accordance with IFRS. The revenue return and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. All items in the above statement derive from continuing operations.

The Company does not have any other comprehensive income and so the total profit/(loss), as disclosed above, is the same as the Company's total comprehensive income.

The Notes form part of these Financial Statements.

Group Statement of Financial Position

These Financial Statements were approved by the Board on 10 June 2025 and were signed on its behalf by:

John Kay

Chairman

The Notes form part of these Financial Statements.

Company Statement of Financial Position

These Financial Statements were approved by the Board on 10 June 2025 and were signed on its behalf by:

John Kay

Chairman

The Notes form part of these Financial Statements.

Group Statement of Cashflows

The Notes form part of these Financial Statements.

Company Statement of Cashflows

The Notes form part of these Financial Statements.

Group and Company Statement of Changes in Equity

The Notes form part of these Financial Statements.

Notes to the Financial Statements

1. Accounting policies

The Financial Statements have been prepared in accordance with UK adopted international accounting standards.

The presentational currency of the Group and Company, and functional currency of the Company, is pounds sterling because that is the currency of the primary economic environment in which the Group and Company operate. The Financial Statements and the accompanying notes are presented in pounds sterling and rounded to the nearest thousand pounds except where otherwise indicated.

(a) Basis of preparation

The Financial Statements have been prepared on a going concern basis as disclosed in the Directors' Report in the Annual Report and on the historical cost basis, except for the revaluation of investment properties and investment in subsidiaries, which are valued at fair value through profit and loss, and £50 million bank borrowings, which are initially measured at consideration received less issue costs. The principal accounting policies adopted are set out below. Where presentational guidance set out in the Statement of Recommended Practice Financial Statements of Investment Trust Companies and Venture Capital Trusts (the SORP) issued by the Association of Investment Companies (AIC) in July 2022 is consistent with the requirements of IFRSs, the Directors have sought to prepare the Financial Statements on a basis compliant with the recommendations of the SORP, except for the allocation of finance costs to revenue as explained in Note 1(f).

The Board has considered the requirements of IFRS 8, 'Operating Segments'. The Board is charged with setting the Group's investment strategy. The Board has delegated the day to day implementation of this strategy to the Investment Manager but the Board retains responsibility to ensure that adequate resources of the Group are directed in accordance with its decisions. The Board is of the view that the Group is engaged in a single segment of business, being investments in UK commercial properties. The view that the Group is engaged in a single segment of business is based on the fact that one of the key financial indicators received and reviewed by the Board is the total return from the investment portfolio taken as a whole. A review of the investment portfolio is included in the report from the Investment Manager in the Annual Report.

(b) Going concern

The Group's business activities, together with the factors likely to affect its future development and performance, are set out in the Strategic Report in the Annual Report. The financial position of the Group as at 31 March 2025 is shown in the Statement of Financial Position in the Annual Report.

The cash flows of the Group for the year ended 31 March 2025 are set out in the Annual Report. The Group had fixed debt totalling £57,985,000 as at 31 March 2025, as set out in Notes 11 and 12 in the Annual Report. As detailed in Note 11 to the Financial Statements in the Annual Report, as at 31 March 2025, the £9 million fixed rate loan is due to be repaid, in the normal course of business, on or before 31 March 2026; £4 million of which was repaid post the year end as detailed in Note 24 to the Financial Statements. 

Note 21 in the Annual Report sets out the Group's risk management policies and procedures, including those covering market price risk, liquidity risk and credit risk.

As at 31 March 2025, the Group's total assets less current liabilities exceeded its total non current liabilities by a factor of 2.84.

The assets of the Group consist mainly of investment properties that are held in accordance with the Group's investment policy, as set out in the Annual Report. The Directors, who have reviewed carefully the Group's forecasts for the coming year and having taken into account the liquidity of the Group's investment portfolio and the Group's financial position in respect of cash flows, borrowing facilities and investment commitments (of which there is none of significance), are not aware of anything that may cast significant doubt upon the Group's ability to continue as a going concern. Accordingly, the Directors believe that it is appropriate to continue to adopt the going concern basis in preparing the Financial Statements.

(c) Basis of consolidation

The consolidated Financial Statements incorporate the Financial Statements of the Company and the entity controlled by the Company (its subsidiary). An investor controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has ability to affect those returns through its power over the investee. The Company consolidates the investee that it controls. All intra-group transactions, balances, income and expenses are eliminated on consolidation. The investment in the subsidiary is recognised at fair value in the Financial Statements of the Company. This is considered to be the net asset value of the Shareholders' funds, as shown in its Statement of Financial Position.

Value and Indexed Property Income Services Limited is a private limited company incorporated in Scotland under company number SC467598. It is a wholly owned subsidiary of the Company and was the Alternative Investment Fund Manager (AIFM) of the Company for the year under review. From 8 September 2024 the Company appointed OLIM Property Limited as is AIFM.

(d) Presentation of Statement of Comprehensive Income

In order to reflect better the activities of an investment trust company and in accordance with guidance issued by the AIC, supplementary information which analyses the Statement of Comprehensive Income between items of a revenue and capital nature has been presented alongside the Statement of Comprehensive Income. In accordance with the Company's Articles, net realised capital returns may be distributed by way of dividend.

Additionally, the net revenue is the measure that the Directors believe to be appropriate in assessing the Company's compliance with certain requirements set out in sections 1158-1160 of the Corporation Tax Act 2010.

(e) Income

Interest receivable from cash and short term deposits and interest payable is accrued to the end of the period.

Rental receivable and lease incentives, where material, from investment properties under operating leases are recognised in the Statement of Comprehensive Income over the term of the lease on a straight line basis. Other income is recognised on an accruals basis.

(f) Expenses and Finance Costs

All expenses and finance costs are accounted for on an accruals basis. Expenses are presented as capital where a connection with the maintenance or enhancement of the value of investments can be demonstrated. In this respect and in accordance with the SORP, the investment management fees have been allocated, 100% to revenue to reflect the Board's expectations of long term investment returns.

It is normal practice and in accordance with the SORP for investment trust companies to allocate finance costs to capital on the same basis as the investment management fee allocation. However, as the Company has a significant exposure to property, and property companies allocate finance costs to revenue to match rental income, the Directors consider that, contrary to the SORP, it is inappropriate to allocate finance costs to capital.

(g) Other receivables

Financial assets classified as loans and receivables are held to collect contractual cash flows and give rise to cash flows representing solely payments of principal and interest. As such they are measured at amortised cost. Other receivables do not carry any interest, they have been assessed for any expected credit losses over their lifetime due to their short-term nature.

(h) Other payables

Payables are non-interest bearing and are stated at their discounted cash flow.

(i) Taxation

The Company's liability for current tax is calculated using tax rates that have been enacted or substantially enacted by the date of the Statement of Financial Position.

Deferred tax is recognised in respect of all temporary differences that have originated but not reversed at the date of the Statement of Financial Position, where transactions or events that result in an obligation to pay more tax in the future or the right to pay less tax in the future have occurred at the date of the Statement of Financial Position.

This is subject to deferred tax assets only being recognised if it is considered more probable than not that there will be suitable profits from which the future reversal of the temporary differences can be deducted.

Due to the Company's status as an investment trust company, and the intention to continue to meet the conditions required to maintain approval for the foreseeable future, the Company has not provided deferred tax on any capital gains and losses arising on the revaluation or disposal of investments.

(j) Dividends payable

Interim dividends are recognised as a liability in the period in which they are paid as no further approval is required in respect of such dividends. Final dividends are recognised as a liability only after they have been approved by Shareholders in general meeting.

(k) Investments

Equity investments

The Company accounts for its investment in its subsidiary at fair value. All fair value adjustments in relation to the subsidiary are eliminated on consolidation.

Investment property

Investment properties are initially recognised at cost, being the fair value of consideration given, including transaction costs associated with the investment property. Any subsequent capital expenditure incurred in improving investment properties is capitalised in the period incurred and is included within the book cost of the property.

After initial recognition, investment properties are measured at fair value. Gains and losses arising from changes in fair value are included in net profit or loss for the period as a capital item in the Statement of Comprehensive Income and are ultimately recognised in the retained earnings.

As disclosed in Note 21, the Group leases out all of its properties on operating leases. A property held under an operating lease is classified and accounted for as an investment property where the Group holds it to earn rental, capital appreciation or both. Any such property leased under an operating lease is carried at fair value. Fair value is established by half-yearly professional valuation on an open market basis by Savills, Chartered Surveyors and Valuers, and in accordance with the RICS Valuation - Global Standards January 2022 (the 'RICS Red Book'). The determination of fair value by Savills is supported by market evidence, excluding prepaid or accrued operating lease income arising from the spreading of lease incentives or minimum lease payments because it has been recognised as a separate liability or asset. The fair value of investment property held by a lessee as a right-of-use asset reflects expected cash flows (including variable lease payments that are expected to become payable). Accordingly, if a valuation obtained for a property is net of all payments expected to be made, it will be necessary to add back any recognised lease liability, to arrive at the carrying amount of the investment property using the fair value model. These valuations are disclosed in Note 9 in the Annual Report.

(l) Cash and cash equivalents

Cash and cash equivalents comprises of deposits held with banks and short term investments.

(m) Non-current liabilities

All new loans and borrowings are initially measured at cost, being the fair value of the consideration received, less issue costs where applicable. Thereafter, all interest-bearing loans and borrowings are subsequently measured at amortised cost. Amortised cost is calculated by taking into account any discount or premium on settlement. The costs of arranging any interest-bearing loans are capitalised and amortised over the life of the loan. When the term of a loan is modified, the amortisation of costs is adjusted in line and the loan measured at fair value on the balance sheet.

(n) Leases

Lessor: The Group leased properties that met the definition of investment property. Leases for which the Group is a lessor are classified as finance or operating leases. Whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease. All other leases are classified as operating leases. All properties are leased out under operating leases and rental income is recognised on a straight-line basis over the expected term of the relevant lease. Many leases have fixed or minimum rental uplifts and where lease incentives or temporary rent reductions have been granted as a result of the COVID pandemic, rental income is recognised on a straight-line basis over the expected term of the lease.

Lessee: The Group assesses whether a contract is or contains a lease, at inception of the contract. The Group recognises a right-of-use asset and a corresponding lease liability with respect to all lease arrangements in which it is the lessee. The right-of-use assets were presented as part of Investment Properties in the Statement of Financial Position and held at fair value. The lease liability related to the head rent on the property in Fareham, which was sold in the year. The capital element of lease obligations was recorded as a finance lease payable liability in the Statement of Financial Position on inception of the arrangement. Lease payments were apportioned between capital repayment and finance charge, using the effective interest rate method, to produce a constant rate of charge on the balance of the capital repayments outstanding.

(o) Critical accounting judgements and key estimates

The preparation of the Financial Statements requires the Directors to make judgements, estimates and assumptions that may affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. The critical accounting area involving a higher degree of judgement or complexity comprises the determination of fair value of the investment properties. The Group engages independent professional qualified valuers to perform the valuation.

Information about the valuation techniques and inputs used in determining fair value as at 31 March 2025 is disclosed in Note 9 to the Financial Statements in the Annual Report.

(p) Adoption of new and revised Accounting Standards

New and revised standards and interpretations that became effective during the year had no significant impact on the amounts reported in these Financial Statements but may impact accounting for future transactions and arrangements.

At the date of authorisation of these Financial Statements, the following Standards and interpretations, which have not been applied to these Financial Statements, were in issue but were not yet effective.

Standards

IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information (effective for periods beginning on or after 1 January 2024 but not yet endorsed for use in the UK).

IFRS S2 Climate-related Disclosures (effective for periods beginning on or after 1 January 2024 but not yet endorsed for use in the UK).

Amendments to IAS 21 'The Effects of Changes in Foreign Exchange Rates' (effective for periods beginning on or after 1 January 2025).

IFRS 18 'Presentation and Disclosure in Financial Statements' (effective for periods beginning on or after 1 January 2027 but not yet endorsed for use in the UK).

IFRS 19 'Subsidiaries without Public Accountability: Disclosures' (effective for periods beginning on or after 1 January 2027 but not yet endorsed for use in the UK).

The Directors have not yet evaluated these standards, therefore, the impact is not yet known.

2. Income

3. Investment management fee

A summary of the terms of the investment management agreement is given in the Directors' Report in the Annual Report.

OLIM Property Limited received an investment management fee of £888,000 (2024 - £863,000), the basis of calculation of which is detailed in the Directors' Report in the Annual Report.

4. Other operating expenses

Directors' fees comprise the Chairman's fees of £33,000 (2024 - £33,000), the Chair of the Audit and Management Engagement Committee fees of £27,000 (2024 - £27,000) and fees of £24,500 (2024 - £24,500) per annum paid to each other Director.

Additional information on Directors' fees is given in the Directors' Remuneration Report in the Annual Report.

5. Finance costs

On 28 November 2019, the Company entered into a £22,000,000 fixed term secured loan facility for a period of up to seven years to 30 November 2026. On 3 March 2021, this facility was extended until 31 March 2031. During the year ended 31 March 2023, the loan was increased to £35,000,000 and extended for a further two years until 31 March 2033, costs previously incurred on the loan were extinguished at this point.

On 5 July 2024, the Company extended the borrowing on the 2033 fixed term secured loan facility from £35,000,000 to £50,000,000.

6. Taxation

The Company and Group have total accumulated unrelieved non-trade loan relationship tax losses carried forward of £1,896,000 (2024 - £8,913,000) at 31 March 2025.

The Company and Group have not recognised deferred tax assets of £474,000 on the basis that the Company has entered the UK REIT regime as of 1 April 2025 and will have limited taxable income to utilise these tax losses in the future.

7. Return per Ordinary Share

The Company holds no dilutive instruments. Diluted earnings per share are equal to earnings per share.

8. Dividends

The third interim dividend of 3.40p (2024 - 3.20p), paid on 25 April 2025, has not been included as a liability in these financial statements.

The final dividend of 3.60p (2024 - 3.60p), being paid on 25 July 2025, has not been included as a liability in these financial statements. The final dividend will be paid as a property income distribution (PID).

Set out below is the total dividend paid and proposed in respect of the financial year, which is the basis upon which the requirements of Sections 1158-1159 of the Corporation Tax Act 2010 are considered.

The current year's revenue available for distribution by way of dividend is £3,113,000 (2024 - £3,916,000).

The final dividend is based on the issued share capital of 42,013,036 Ordinary Shares as at 31 March 2025, excluding the Ordinary Shares held in Treasury.

9. Investments

The fair value valuation given by Savills excludes prepaid or accrued operating lease income arising from the spreading of lease incentives or minimum future uplifts and for adjustments to recognise finance lease liabilities for one leasehold property, both in accordance with IFRS 16. The valuation has, therefore, been decreased.

The fair value valuation given by Savills includes £2,500,000 relating to the property at Bawtry Close, Doncaster where contracts have been exchanged and the sale completed on 24 April 2025.

Transaction costs

During the year, expenses were incurred in acquiring and disposing of investment properties classified as fair value through profit or loss. These have been expensed through capital and are included within gains and losses on investment properties in the Statement of Comprehensive Income. The total costs were as follows:

The fair values of the investment properties were independently valued by professional valuers from Savills, acting in the capacity of External Valuers as defined in the RICS Red Book (but not for the avoidance of doubt as an External Valuers of the portfolio as defined by the Alternative Investment Fund Managers Regulations 2013). The valuations were prepared on the basis of Fair Value as required by the IFRS (International Financial Reporting Standards). In addition, the valuations have also been prepared in accordance with RICS Valuation - Professional Standards VPS 3.5 Fair Value and VPS 4.1 Valuations for Inclusion in Financial Statements. The definition of Fair Value is set out in IFRS 13 and is adopted by the International Accounting Standards Board as follows:

"The price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date"

The RICS Red Book directs us to consider that Fair Value is consistent with the concept of Market Value, the definition of which is set out in Valuation Practice Statement 4 1.2 of the Red Book, as follows:

"The estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm's length transaction after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion."

The valuations have been arrived at predominantly by reference to market evidence for comparable property (Level 3 of the Fair Value Hierarchy). As part of Savills' standard process, the valuations were carried out by specialist valuers, which were peer reviewed and reviewed again prior to the valuation date. During the review process, the various characteristics of each property were taken into consideration.

A 25 bps decrease in the equivalent yield applied would have increased the net assets attributable to the Group and Company's Shareholders and the total gain for the year by £5,550,000. A 25 bps increase in the equivalent yield applied would have decreased the net assets attributable to the Group and Company's Shareholders and the total gain for the year by £5,200,000. A 5% decrease in the rental value applied would have decreased the net assets attributable to the Group and Company's Shareholders and the total gain for the year by £3,150,000. A 5% increase in the rental value applied would have increased the net assets attributable to the Group and Company's Shareholders and the total gain for the year by £3,100,000.

Investment in subsidiary

Value and Indexed Property Income Services Limited was non-trading throughout the year and post the year end, on 2 April 2025, the company was placed into Members' Voluntary Liquidation.

10. Receivables

Many of the Company's leases provide for minimum and maximum increases of rental at future rent reviews. Minimum increases have been averaged over the life of the lease, generating an operating lease asset.

11. Current liabilities

The amount due to OLIM Property Limited comprises the monthly management fee for March 2025, subsequently paid in April 2025.

The Company has a £15,000,000 fixed term secured loan facility for a period of up to ten years to 31 March 2026 (2024 - £15,000,000). At 31 March 2025, £9,000,000 (2024 - £11,893,750) was drawn down at a rate of 4.344% and £nil (2024 - £3,106,250) was drawn down at a rate of 3.60%.

The terms of the loan facility contain financial covenants that require the Company to ensure that:

- in respect of each 3 month period ending on 31 March and 30 September (the Half Year dates), net rental income shall

be at least 200 per cent of interest costs;

- in respect of each 12 month period beginning immediately after 31 March and 30 September, net rental income shall

be at least 200 per cent of interest costs; and

- at all times, the loan shall not exceed 60 per cent of the value of the properties that have been charged.

12. Non-current liabilities

On 28 November 2019, the Company entered into a £22,000,000 fixed term secured loan facility for a period of up to seven years to 30 November 2026. On 3 March 2021, this facility was extended until 31 March 2031. On 27 April 2022, the loan was increased to £30,000,000 and on 22 June 2022, the loan was increased to £35,000,000 and extended for a further two years until 31 March 2033, costs previously incurred on the loan were extinguished at this point.

On 5 July 2024, the Company extended the borrowing to £50,000,000.

As at 31 March 2025, the loan is recorded on an amortising basis. 95% of the loan is at a fixed rate and 5% at a floating rate of interest. At 31 March 2025, £50,000,000 was drawn down at a net effective interest rate of 4.61%.

The terms of the loan facility contain financial covenants that require the Company to ensure that:

- the total debt ratio does not at any time exceed 50 per cent;

- projected interest cover is not less than 200 per cent at all times; and

- the Loan to Value shall not exceed 55% of the value of the properties that have been charged.

The fair values of the loans are disclosed in Note 21 and the Net Asset Value per share, calculated with the borrowings at fair value, is disclosed in Note 17 in the Annual Report.

13. Deferred tax

Under IAS 12, provision must be made for any potential tax liability on revaluation surpluses. As an investment trust, the Company does not incur capital gains tax and no provision for deferred tax is therefore required in this respect.

As disclosed in Note 6 in the Annual Report, a deferred tax asset has not been recognised on the basis that the Company has entered the UK REIT regime as of 1 April 2025 and will have limited taxable income to utilise these tax losses in the future.

14. Share capital

The ordinary share capital on the Statement of Financial Position relates to the number of Ordinary Shares in issue and held in Treasury. Only when shares are cancelled, either from Treasury or directly, is a transfer made to the Capital Redemption Reserve.

During the year, the Company repurchased 651,514 Ordinary Shares at a cost of £1,174,000 including expenses.

Subsequent to the year end, the Company repurchased no Ordinary Shares.

15. Share premium

16. Retained earnings

The table below shows the movement in retained earnings analysed between revenue and capital items.