Leveraging
market
opportunities
to grow
sustainably
Annual report and accounts for
the year ended 31 December 2022

Who we are
Highcroft Investments PLC is an internally-managed Real
Estate Investment Trust (REIT), which invests in commercial
property in England and Wales.
Our purpose
Highcroft’s purpose is to provide our tenants with
quality properties, in good locations, enabling them to
succeed, andour stakeholders to benefit on a long-term,
sustainable basis.
Our vision
Our vision is to ensure every opportunity has a positive
impact on others.
Our culture
Our culture is open and supportive. Integrity is a value
that defines our culture and underpins the way that
wedobusiness.
Our values
Our values are reputation, integrity and good governance
built on long-term relationships, and on sustainability
andresponsibility.
Our strategy
Highcroft aims to deliver sustainable long-term income
and capital growth for its shareholders through accretive
asset management initiatives and recycling of capital in its
regionally-based property portfolio.
Our competitive strengths
AN EXPERIENCED
INTERNAL TEAM
STRONG
BALANCE SHEET
GOOD-QUALITY
PROPERTY ASSETS
CONSERVATIVE
GEARING
View more online at:
www.highcroftplc.com
Highcroft
Investments PLC
Overview

Contents
OVERVIEW REPORT
Highlights 02
Chairman’s statement 04
Why invest? 05
Group at a glance 06
Our portfolio 10
STRATEGY REPORT
UK commercial property market 18
Our business model 22
Our strategy 24
Our strategy case in action 26
Our key performance indicators 28
Operating review 30
Financial review 34
Our risks 38
Stakeholder engagement 46
Sustainability 48
GOVERNANCE REPORT
Chairman’s introduction to
corporate governance 54
Board of directors 58
Corporate governance 60
Audit committee report 63
Nomination committee report 70
Directors’ remuneration report 72
Report of the directors 84
Statement of directors’ responsibilities 87
FINANCIAL STATEMENTS
Independent auditor’s report 90
Consolidated statement of
comprehensive income
96
Consolidated statement of financial position 97
Consolidated statement of changesin equity 98
Consolidated statement of cashflows 99
Notes to the consolidated financialstatements 100
Company statement offinancialposition 114
Company statement of changes inequity 115
Notes to the company financialstatements 116
List of definitions 120
Group five-year summary (unaudited) 121
Directors and advisers 122
Sustainable thinking,
responsible business
What sustainability
means for Highcroft
At Highcroft, we strive to conduct our business
in an ethical and responsible manner, making a
positive contribution to society whilst minimising
any negative impacts on people and the
environment. We recognise that natural resources
are finite and should be used responsibly. Our
climate strategy and objectives are the responsibility
of the board and potential climate-related risks
are identified andmonitored as part of our wider
risk-management procedures.
Where opportunities have arisen to upgrade
andimprove the efficiency of our buildings from
asustainability aspect, we have addressed this.
AtSt Mary’s House, Cardiff, our improvements over
the year included installing upgraded LED lighting
systems and the provision of cycle spaces and
shower/changing facilities, with reduced car park
spaces to encourage cycling to work. Our work over
the coming year will continue to focus, with our
property asset managers, on prioritising actions to
address our EPCratings across the portfolio.
In terms of undertaking a comprehensive approach
to sustainability, prior to submitting our planning
application for our proposed development in
St Austell, extensive ecological surveys were
undertaken to ensure the habitat was protected
and/or replaced. The consented building will be built
to the BREEAM ‘very good’ standard specification,
involving the latesttechnology for sustainability.
We will continue to take into consideration
sustainability matters, together with the views
received from our stakeholders, as we contemplate
any decisions on future capital spend.
Stock code: HCFT
highcroftplc.com
01

1
Dividends payable
to shareholders
2
Net asset value
per share
3
Gross property
income
56.0p 1,081p £5.6m
1.8% (15.2%) (5.4%)
2022
2021
2020
2019
2018
55.0
57.0*
48.0
52.5
56.0
2022
2021
2020
2019
2018
1,104
1,175
1,207
1,081
1,275
2022
2021
2020
2019
2018
6.1
5.8
5.0
5.6
5.9
* includes special dividend
of6p per share
6
Total earnings
per share
7
Value of property
assets
8
Net debt/gearing
(137.0p) £77.9m
£20.0m
(11.0%) (36%)
2022
2021
2020
2019
2018
(22.2)
23.3
95.3
(137.0)
230.5
2022
2021
2020
2019
2018
82.1
86.7
77.7
77.9
87.6
2022
2021
2020
2019
2018
23.9
24.6
14.2
20.0
21.5
Overview
02
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Highlights

4
Net property
income
5
Adjusted earnings
per share
£5.3m 62.9p
0.3% 6.2p
2022
2021
2020
2019
2018
5.5
5.7
4.9
5.3
5.3
2022
2021
2020
2019
2018
56.7
67.7
78.5
87.3
62.9
9
Occupancy
94%
2022
2021
2020
2019
2018
99
100
100
94
93
Stock code: HCFT
highcroftplc.com
03

Highcroft has not been immune to the macro-economic
factors affecting the UK and the wider global economy
during 2022. Just as the economy started to recover from
the Covid-19 pandemic, we were hit by the effects of the
Russian invasion of Ukraine, which contributed to a year
of soaring inflation, significant rises in interest rates and
political instability. However, while the gains in net asset
value of 2021 were reversed in 2022, I am pleased to say
that due to our diversified portfolio, strong balance sheet,
low levels of gearing, and low fixed borrowing costs, our
profit before tax increased during the year leading to a 1.8%
increase in the total annual dividend. I believe we are well
positioned to weather the current economic challenges and
to continue to deliver an attractive, secure, and long-term
dividend to our shareholders.
Property portfolio
During 2022, our portfolio remained unchanged. It remained
focussed on warehouses and retail warehouses, which
made up 72% of our portfolio by asset value at the year end.
These sectors performed well in the first half of 2022, but
were affected by the significant adverse market movements
in the second half of the year. On a like-for-like basis, our
total portfolio reduced by 11.8% (£10.4m), which was better
than the all-property market negative movement of 14.2%.
We did not acquire any properties during the year, although
we carried out improvement work at our Cardiff property
and gained planning permission for the development of
an industrial unit at our property in St Austell, resulting in
additions of £0.7m. After the year end, in February 2023,
we sold our Llantrisant asset for £7.85m, £1.1m above the
2022 year-end valuation and £0.9m above cost. As this asset
had been vacated by the tenant during 2022, and the lease
expired in Q1 2024, this disposal, at this price, in the current
market protects shareholder value in the medium term.
We intend to invest our available cash back into property
that meets ours strict selection criteria in a timely manner.
Despite the macro-economic challenges affecting our
tenants in 2022, we collected 100% of the rent due for the
year (2021 97%) and we let one of the two properties that
were void at the start of the year, leaving one void unit, our
Cardiff asset, representing 6% of our rental income. At the
year end, contracted rental revenue was 0.2% higher than
at 31 December 2021, whilst net rental income remained
constant at £5.3m compared to 2021.
Our net assets have fallen by £9.9m, 15.0%, (2021 rise of
£9.0m, 15.7%), primarily as a result of the movements in
property valuation.
We have kept our debt levels low at 36% LTV with a
weighted average cost of debt of 3.06% and have
no debt maturing before 2026.
Dividend
The company’s interim dividend was 23p, a 4.5% increase
on 2021, and we are proposing a final dividend for 2022 of
33p per share, taking the total dividend for 2022 to 56p per
share. This represents an increase of 1.8% from the 2021
dividend of 55p per share.
Continued focus on ESG
Highcroft has a clear purpose of providing our tenants with
excellent properties in optimal locations, enabling them to
succeed, and our stakeholders to benefit on a long-term
sustainable basis. As a board, we have maintained our focus
on sustainability, particularly during the refurbishment of
our Cardiff asset and the design of a new building at our
St Austell site. We continue to develop the most appropriate
strategy for reducing our environmental impact within the
existing portfolio and consider ESG matters in the selection
of new assets.
People
Our strategy is focussed on our competitive strength and
our people, including our advisory teams, who are critical to
this. In September 2022, Simon Gill indicated his intention
to stand down as executive director on 31 March 2023 and
I would like to thank him for his valuable contribution to
the board over the past decade, which has been a period of
significant growth for the group. He leaves behind a strong
and well-positioned property portfolio.
In January 2023, we were pleased to announce the
appointment of Paul Leaf-Wright as chief executive with
effect from 1 January 2023. He brings with him a wealth
of experience of property companies and of delivering
shareholder value. As part of this change, we have also
appointed new property advisers to the board and both they
and Paul have completed their handover from Simon Gill.
Charles Butler
Chairman
04
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Overview
Chairman’s statement

Outlook
Highcroft’s performance in 2022 was resilient,
notwithstanding global and UK events causing repercussions
in our marketplace. Since the year end, as mentioned, we
have successfully sold one of our properties for £7.85m, an
increase of 16% over the 31 December 2022 valuation. With
our well-positioned portfolio, low level of well-priced debt
and cash in the bank for reinvestment, we are well placed
to continue to deliver long-term secure returns for our
shareholders.
Our AGM this year will, as last year, be an open meeting, and
I look forward to meeting those of you who can make it.
Charles Butler
Chairman
27 March 2023
Why invest in Highcroft?
01
Strong balance sheet
and cash generative
Our £77.9m, 847,559 sq ft of assets
underpin our balance sheet and
financial strength.
02
Strong dividend returns
Our dividends have increased by
a compound annual rate of 6.1%
since joining the REIT regime in
2009, and payments to shareholders
weremaintained during the Covid-19
pandemic.
03
Diversified and
sustainable income from
the UK property market
We had 21 assets at 31 December
2022, spread across five sectors,
geographically focused in the
south of the UK with a WAULT
of five years.
04
Strong internal
management team
Our experienced executive team has
consistently delivered on our strategy;
they are aligned with shareholders
and have a consistent track record.
Thenew chief executive has significant
experience of delivering stakeholder
expectations.
05
Growing occupier
demand
In certain sectors there is increasing
demand for the right property in the
right places for good tenant covenants.
Stock code: HCFT
highcroftplc.com
05
We are well placed to continue
to deliver long-term secure
returns for our shareholders

Our structure
The property-owning subsidiaries, Rodenhurst Estates Limited and Belgrave Land (Wisbech) Limited, are wholly owned and
carry out the management and administration of the property assets on behalf of the group.
Highcroft Investments PLC
Group administration
Property investments
Rodenhurst Estates Limited Belgrave Land (Wisbech) Limited
Aligning to stakeholder interests
Highcroft has a wide group of stakeholders including its shareholders, tenants, employees, advisory team and suppliers, our
local community and the environment. As described in more detail on page pages 46 to 47, we engage effectively with our
stakeholders to ensure that their interests are considered during our decision making.
Read more about our strategy on pages 24 to 27
Overview
06
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Group at a glance

Why the quality of our tenants
is crucial to our success; how
we assess potential tenants and
manage relationships
The quality of our tenants is crucial to our success so that we
can maintain the dividend levels that our shareholders have
witnessed and benefitted from over many years. We assess
the strength and quality of each new tenant relevant to the
property and location in question; if a tenant trades well,
the rental income will be secure, which will be passed on to
shareholders via a dividend. Equally, if the location is good
for the tenant, this will attract further occupiers and increase
demand, therefore ensuring future rental growth.
Prior to entering into a lease with a tenant, we will undertake
financial due diligence to ensure the prospective tenant can
meet its financial commitments under the lease.
Our tenant criteria: ensuring our
tenants are sustainable
We make great efforts to ensure our properties are
let to, andoccupied by, tenants and companies that
have sustainable, environmental credentials. We work
together, with our occupiers, to make sure we comply
withgovernment guidelines on green policies, which
includes ensuring that there will be no future ground
contamination issues.
Weighted average lease length
5.0 years
2022
2021
2020
2019
2018
5.9
6.3
6.5
5.0
5.6
Weighted average lease expires
>5 years
2-5 years
1-2 years
<1year
3.8%
1.0%
64.7%
30.5%
Investment properties
at annual valuation
£77.9m
2022
2021
2020
2019
2018
£82.1
£86.7
£77.7
£77.9
£87.6
Movements in investment property valuation
2021 2022
£m
0
£87.6m
£77.9m
Valuation gains
£0.6m
Additions
£0.7m
100
80
60
40
20
Valuation losses
£(11.0)m
Stock code: HCFT
highcroftplc.com
07
Introduction to our
property portfolio

Our portfolio in 2022
TOTAL VALUE
£77.9m
AVERAGE LOT SIZE
£3.7m
NUMBER OF PROPERTIES
21
DISPOSALS
£nil*
ADDITIONS TO EXISTING
PROPERTIES
£0.7m
* Property valued at £6.75m sold
in February 2023 for £7.85m
Overview
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
08
Group at a glance continued

30p
35p
40p
45p
50p
55p
60p
Full-year total dividend (pence per ordinary share)
Net assets (£’000)
Key
2013 202220212020201920182017201620152014
£40m
£45m
£50m
£55m
£60m
£65m
£70m
33.75p
Prudent gearing (net of cash) (%)
£42,428
£47,702
£53,023
£55,325
£59,977
£62,384
£57,121
£66,117
£56,176
36.00p
38.80p
41.00p
46.25p
52.50p
48.00p
57.00p
55.00p
56.00p
£60,721
41%
42%
32%
36%
23%
29%
21%
13%
4%
2%
0%
15%
30%
45%
Over recent years Highcroft has focused on
operating at safe and prudent gearing levels.
Our financial position will allow us to navigate
the years ahead and make the most of
the opportunities that are available.
The Highcroft team has delivered stable and consistent returns to shareholders
Stock code: HCFT
highcroftplc.com
09
Looking back at the past ten years

3
6
2
4
5
1
12
9
11
14
15
16
8
19
7
20
13
10
17-18 & 21
Introduction
The portfolio remains
well balanced between
the sectors with a bias
towards the warehouse
and retail warehouse
sectors, which comprise
72% by value and offer
particularly resilient
occupational markets.
Looking forward, the
asset composition within
each sector also provides
good opportunities
for revenue growth via
new retail and offices
leases on Oxford High
Street, lease renewals
on two retail warehouse
units at Wisbech, a new
office letting at Cardiff
and a new warehouse
development at St Austell.
There has been further
opportunity to capitalise
on the growth of the
life science sector and
government-backed
industry within Wales at
Llantrisant via a strategic
sale before the BAAE
lease expiry.
Warehouse/industrial
Take up of ‘logistics’ units of over
100,000 sq ft reduced slightly from
2021 levels, but was still higher than the
five-year average and the third best
year on record. Logistics companies
are now more active than e-commerce
and headline rents have grown
10.3%, whilst supply has increased to
6.4% (or 2.5% if ongoing speculative
construction is excluded). Grade A
supply has increased by 47%, but based
on the take-up rate over 2022, this only
accounts for ten months of demand.
The prime assets with near-term
reversion have held liquidity, albeit with
a 200bps discount from 2021. Yields
at the close of 2022 were 5.25%–5.50%
for prime assets with 15-year leases or
up to 6.00% for secondary distribution
and with ten-year income, according to
Knight Frank.
Retail warehouse
The retail warehouse sector was one
of the best performing of any of the
traditional real estate sectors in 2022,
driven by excellent capital growth
and robust income return. Retail
warehousing remains an attractive
proposition, given its price adjustment
over recent years, and capital
remains prominent within the sector,
particularly targeting added-value
and opportunistic assets, and those
supported by strong anchor tenants,
such as supermarkets. Locations with
affluent catchments have proven to
be very resilient over recent years, a
trend we expect to continue. Recent
occupier demand has been focused on
these types of destinations, attracted by
strong demographics less likely to be
hit by the cost-of-living crisis.
Yields have moved out by 100bps to
5.75% for the best quality solus open A1
stock with 15-year income, whilst good
secondary retail parks have moved to
7.50%. Out-of-town open A1 essential
retailers are priced at 6.00%. Out-of-
town vacancy rates remain the lowest
of all the retail sub-sectors at 9.7%
(Q3 2022).
Our core sectors
Warehouse
Retail warehouse
Leisure
Office
High street retail
Warehouse
assets
Value
£’000
1
Llantrisant 6,750,000
5
St Austell 5,950,000
6
Nottingham 5,175,000
7
Milton Keynes 5,150,000
9
Kidlington 4,600,000
11
Ash Vale 4,000,000
14
Bedford 3,250,000
Total 34,875,000
Retail Warehouse
assets
Value
£’000
2
Wisbech 6,650,000
3
Grantham 6,400,000
4
Bicester 5,950,000
15
Crawley 2,500,000
Total 21,500,000
10
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Overview
Our portfolio

Leisure
Leisure spend reported strong growth
over the summer; however, mounting
financial pressures on occupiers
may challenge the sector in the
short term. Nonetheless, consumer
engagement in leisure activities saw
leisure spend increasingly improve
as lockdowns ended. Whilst rising
prices are of concern, a desire to enjoy
affordable luxuries continues to drive
visits. Leisure operators may, naturally,
experience an upswing in revenues
from overseas tourism and from
consumers forgoing overseas holidays
in favour of cheaper UK staycations.
Prime leisure park yields registered at
7.50% for December 2022, moving out
from 7.00% in September. Secondary
yields softened to 9.00% in December
2022, having previously been at 8.00%
in September.
Office
Take-up across the regional cities
up until Q3 2022 was only 5% below
the five-year annual average but an
improvement on recent years since
the Covid-19 pandemic. However take
up in Q4 is likely to be down when
figures are released, reflecting business
uncertainty. Grade A supply increased
in Q3 following development and
refurbishment completions; however,
supply of grade A space remains
constrainedand the associated
record prime rents have held their
level, illustratingthe occupier focus
on securing the best quality space.
Investment activity slowed in Q3,
and Q4 transactions outside London
are anticipated to be significantly
down as investors sought prime
industrial investments at material
discounts in preference to offices,
which carry more capital risks through
cyclicalobsolescence.
Major regional city yields with five-year
WALTS are between 6.5%–7.00%, whilst
south-east towns are at 7.00%–7.50%.
High street retail
High street retail continues to be
a heavily-affected sector in the
wake of the cost-of-living crisis and
rising inflation. Demand, principally
originating from property companies
and UK/overseas private investors,
remains focused on opportunities
inbetter-quality, south-east centres,
and some regional cities. The relative
simplicity, low management and
elevated yields mean that these
opportunities have remained relatively
liquid, especially over small lot sizes.
In December, Knight Frank’s view on
prime high street yields softened to
6.75% with regional cities sitting at
7.00% and good secondary yields at
9.00%–9.25%.
Leisure
assets
Value
£’000
8
Rubery 4,700,000
13
Ipswich 3,450,000
16
Coventry 1,725,000
Total 9,875,000
Office
assets
Value
£’000
10
Oxford 4,100,000
12
Cardiff 3,500,000
Total 7,600,000
High street
retail assets
Value
£’000
17 18
Oxford (2 units) 1,675,000
19
Leamington Spa 1,100,000
20
Norwich 700,000
21
Oxford 585,000
Total 4,060,000
Stock code: HCFT
highcroftplc.com
11

Warehouse Total value £34.9m
TENURE LET TO
VALUE
£’000
SIZE
sq ft
11
ASH VALE FREEHOLD
WAREHOUSE
4,000 25,081
14
BEDFORD FREEHOLD
WAREHOUSE
3,250 40,536
9
KIDLINGTON FREEHOLD
WAREHOUSE
4,600 30,638
1
LLANTRISANT
1
VIRTUAL
FREEHOLD
WAREHOUSE/
R&D FACILITY
6,750 111,036
7
MILTON KEYNES FREEHOLD
WAREHOUSE
5,150 43,111
6
NOTTINGHAM FREEHOLD
WAREHOUSE
5,175 83,010
5
ST AUSTELL FREEHOLD
WAREHOUSE
5,950 250,087
1 Disposed of February 2023 see page 26 for more details.
12
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Overview
Our portfolio continued

Warehouse Retail warehouse Leisure Office High street retail
Retail warehouse Total value £21.5m
TENURE LET TO
VALUE
£’000
SIZE
sq ft
4
BICESTER FREEHOLD
RETAIL
WAREHOUSE
5,950 29,129
15
CRAWLEY FREEHOLD
RETAIL
WAREHOUSE
2,500 6,879
3
GRANTHAM FREEHOLD
RETAIL
WAREHOUSE
6,400 42,090
2
WISBECH FREEHOLD
RETAIL
WAREHOUSE
6,650 55,628
Stock code: HCFT
highcroftplc.com
13

Office Total value £7.6m
TENURE LET TO
VALUE
£’000
SIZE
sq ft
10
OXFORD
SUMMERTOWN
FREEHOLD
OFFICES
4,100 11,770
12
CARDIFF FREEHOLD
OFFICES
VOID 3,500 17,797
Leisure Total value £9.9m
TENURE LET TO
VALUE
£’000
SIZE
sq ft
16
COVENTRY FREEHOLD
LEISURE
1,725 5,953
13
IPSWICH FREEHOLD
LEISURE
3,450 43,928
8
RUBERY FREEHOLD
LEISURE
4,700 38,264
14
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Overview
Our portfolio continued

High street retail Total value £4.1m
TENURE LET TO
VALUE
£’000
SIZE
sq ft
19
LEAMINGTON
SPA
FREEHOLD
SHOP
SABRE RETAIL
LTD T/A
1,100 2,619
20
NORWICH FREEHOLD
SHOP
700 3,349
21
OXFORD
HIGH STREET
FREEHOLD
SHOP
585 1,685
17–18
OXFORD
HIGH STREET
FREEHOLD
SHOP
ROBINSON
WEBSTER T/A
1,675 4,969
Warehouse Retail warehouse Leisure Office High street retail
Stock code: HCFT
highcroftplc.com
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Strategy
report
Contents
UK commercial property market 18
Our business model 22
Our strategy 24
Our strategy case in action 26
Our key performance indicators 28
Operating review 30
Financial review 34
Our risks 38
Stakeholder engagement 46
Sustainability 48
16
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022

Stock code: HCFT
highcroftplc.com
17

75
100
4.00
4.25
4.50
4.75
5.00
5.25
5.50
5.75
6.00
50
2017
25
0
2018 2019 2020 2021 2022
£ Billion
Net initial yield in per cent, scale inverted
Source: MSCI
12-month moving sum
Net initial yield
(all property)
Macro environment
After an initial post-covid rebound for the UK economic climate, the grey cloud of inflation gathering over H2 2021 has
darkened over the second half of 2022, hitting double-digit levels not seen for 40 years. The war in Ukraine and now China’s
easing of covid restrictions (without effective vaccinations) has exacerbated the constraints on supply chains that hang over
from covid and Brexit. Perhaps, more significantly, though, the war in Ukraine and Europe’s reliance on Russian gas has
added huge energy cost inflation. The UK also faced unprecedented political turmoil, which resulted in five fiscal events
occurring in 2022, including the ‘mini-budget’, which caused further disruption in the markets.
Economic backdrop
UK unemployment has been low, and wages have been rising, causing issues for many businesses. Both consumer
and business spending are anticipated to slow, bringing inflation under control, although at the expense of higher
unemployment throughout 2023.
Somewhat positively for the UK, core inflation, which strips away volatile food and fuel prices, has remained broadly flat at
around 6% throughout 2022. Given that the World Bank forecasts that energy prices will fall by 11% in 2023, agricultural prices
by 5%, and metal prices by 15%, compared to their 2022 averages, the inflationary outlook is improving. It is anticipated that
there is ‘pain to come’ in the form of insolvencies and unemployment in the UK, but with inflation then, hopefully, under
control, there is a more positive outlook to the end of the year and 2024, assuming no further shocks, such as an escalation
of Russia’s war in Ukraine.
Property investment
The UK investment markets were slowly recovering and
rebalancing, despite the gathering inflationary pressures in
late 2021. Notwithstanding these inflationary pressures, the
prime retail and office markets had been repriced in early
2022 and the industrial sector continued to benefit from the
unabated growth of rents driven by the continued growth
of e-commerce and the boost from the effect of Covid-19 on
supply chains. Mid-2022 investment volumes were above
the five-year average and 2021 levels; however, the effect of
the Ukraine war and UK political instability, peaking with
the mini-budget in September, caused an acute increase
in the cost of debt reducing property transaction volumes
significantly, leaving the year 6% down on the five-year
average and well below 2021.
Given debt costs moved over 2022 from roughly 3.5% to 6.0%,
the prime industrial market, trading at yields of sub 4.0%,
saw an immediate drop in pricing. However prime assets
remained liquid given the structural growth of warehouse
demand and we understand that many investors still realised
a gain on their original investment despite a discount of
circa 20% from valuation. December industrial investment
volumes were 45% below the five-year monthly average,
whilst the years figures were still the second highest
on record.
The office market, which was already being highly
polarised between prime and secondary assets, lacked
the same drivers of liquidity that the industrial market
has, and December’s trading volumes were 71% down on
the five-year average, being the worst on record, and the
total year’s figures were 30% below the five-year average.
London markets and life science-orientated assets were the
stronger parts of the market.
Retail capital values have been falling since before Covid-19
and, given the relatively high yields, have been less effected
by adjustment to higher debt costs. Retail investment
volumes reached a seven-month high in December with unit
shops seeing a one-year high and twice the monthly average
with the years figures at 9% above the five-year average.
Conversely, the leisure market came to almost a standstill in
December although over the whole year was only 25% down
on the 5-year average.
Strategic Report
18
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
UK Commercial Property Market

Market trend What this means for Highcroft
Highcroft’s response
tothese trends
Focus on energy within ESG
The acute and unexpected increase in energy costs
has brought, into greater focus, the demand for
energy-efficient buildings from a cost perspective,
in addition to the wider CSR and legislative drivers.
This has accelerated the ‘E’ aspect of ESG in
particular.
Aside from a driver at tenant level, investment
are seeking to retain and secure their constituent
investors on the basis of ESG credentials.
Irrespective of energy costs stabilising
in the future, energy-efficient
buildings secure more competitive
tension to lease.
This growth of ESG is driving the
need for greater depths of ESG
credentials and, therefore, energy
efficiency is critical and the simplest
to measure.
We continue to engage
with tenants and invest
capital into assets to
improve them. EPCs across
the portfolio are recorded
and monitored with every
refurbishment. In addition,
the wider commercial
rationale of any acquisition
or disposal considers
the longer-term ESG
credentials as a component
of its investment attributes.
Business & consumer contraction inspending
Inflation is expected to ebb in 2023, but only
gradually, and to levels that are still high by historic
standards with consensus among economic
commentators anticipating a shallow recession
with a further uptick in unemployment. Business
surveys are pointing to a rising tide of corporate
caution and cost control, which may swing into
cost cutting over H1 2022. Consumers will continue
to tighten spending; however, 2024 could mark a
turning point for households.
Consumer-facing sub-sectors, such as
retail, leisure and hospitality, will face
another difficult year. Landlords could
be looking at tenant bankruptcies,
resulting in voids that are difficult to
fill, given weaker business demand.
However, many weaker businesses
have already been sifted out by
Covid-19, so the market is resilient,
and this final purge should help
these same sectors move into a
new market cycle.
It is possible that some redundancies
in the financial and tech sectors
could exacerbate the wider structural
contraction in the UK office space
post Covid-19.
As through the Covid-19
period, we will maintain
a closely monitor tenant
performance and seek to
engage and manage any
issues, collaboratively, with
our tenants. However, we
are prepared to pivot into
a new tenancy or strategy,
given that, in many
instances, the underlying
property could attract a
stronger covenant or an
alternative use.
Difficult debt environment and limited
investment liquidity
Net lending to commercial property increased for
the third consecutive month in November 2022, at
just over £1.0bn, the strongest rise in commercial
property lending since December 2021. However,
a higher cost of borrowing than we have been
used to over the last decade is here to stay and
affordability challenges are anticipated this year
for UK investors.
On account of debt costs shaken by economic
instability, Q4 2022 (post September mini-
budget) saw one of the lowest commercial
property investment volumes traded in a decade,
according to Costar. Clearly, debt is a key market
driver looking forward, and given the collapse in
investment volumes in Q4, asset liquidity and,
therefore, debt security is critical.
2023 is likely to see some ‘forced
sellers’ driven by refinancing events.
To date, the prime industrial sector
has remained relatively liquid,
and at a significantly discounted
value, despite good medium-term
prospects for rental growth.
We remain secure with
long-term funding in place
and a strong portfolio
of assets and tenants;
however, timing of any
debt refinance would
need to be aligned with an
optimal composition of the
portfolio.
Looking forward, the industry expectation is for market
pricing to move out in Q1 2023, where the future revenue
andrental prospects of any asset class are squeezed by the
cost-of-living crisis and a reduction in discretionary spend.
Leisure assets and bulky retail assets are likely to feel this
pinch the most whilst the grocery sector is defensive and
the industrial sector is best placed for rental growth given
supply constraints. The market expectation is that Q2 will
see a material increase in transactional activity, with 2023
transaction volumes being slightly less than 2022. However,
recalibrating prices for sub-prime, non-ESG-compliant assets
will take longer as refinancing needs clash with higher debt
costs and tighter banking requirements.
Stock code: HCFT
highcroftplc.com
19

UK Commercial Property Market continued
Industrial Retail warehouse Leisure
Key trends
The structural shift within the retail
sector, to balance e-commerce and
returns with retailers’ portfolios of
shops, continues driving demand for
suitable warehouses and, particularly,
the ‘last mile’ logistics facilities,
where land supply is most restricted.
Manufacturing has proven to be an
area of growth, with supply chain
resilience through onshoring set to
continue within the UK.
Occupier demand for industrial space
is robust, with the shortage of available
space expected to continue into 2023.
Business rates are set to increase,
significantly, in this sector given the
increase in rents, which in combination
with rental increases, has increased
tenant costs.
What this means for
Highcroft
Industrial is the largest exposure within
the portfolio, totalling 45% by value.
Whilst increasing operating costs may
challenge some tenants, the favourable
demand-supply dynamics and recent
rental growth mean that the sector is
very well placed to generate returns
through rent reviews, re-gears and
new leases, whilst the stabilisation of
debt markets and investor confidence
should return capital growth over 2023.
Highcroft’s response to
these trends
In November 2022, we secured
planning consent for a new warehouse
of 28,300 sq ft on 1.9 acres of land at
Roche, St Austell, having identified a
possible tenant, and are progressing
the agreement of a new lease.
Key trends
Grocers and other discount
retailers are seeking to grow their
estates throughout 2023 with retail
warehouses/parks often being one of
the most suitable mediums for such
growth. Tesco, Sainsburys, Asda and
Morrisons, are looking for new sites
to open convenience stores, and the
discount chains, Aldi and Lidl, continue
to embark on ambitious store opening
plans – Aldi announced it would open
100 new stores over the next two years,
whilst Lidl plan to open up to 200
new stores by 2025. At the value end
of the sector, Greggs, Home Bargains,
Poundland and B&M also have intent
to expand.
What this means for
Highcroft
The retail warehouse sector represents
28% of the portfolio by value. We
would expect good levels of interest
for our well-located assets should we
experience any vacancies.
Highcroft’s response to
these trends
We are actively engaging in renewal
discussions with tenants with short-
dated leases to improve rental level
and lease length.
Key trends
2023 is anticipated to be a turbulent
year for the leisure sector, particularly
for some sub-sectors such as F&B (food
and beverage), which will be heavily
exposed to rising operating costs.
International tourism is predicted
to continue its rebound, with major
events planned for 2023 across the
UK, which will result in an increase in
both overseas and domestic tourist
spend in the UK. Although Health and
Fitness operators have been vulnerable
during previous recessions, there may
be an increase in membership sales
at budget gyms, as users of more
expensive fitness centres and classes
switch to cheaper alternatives to
save money.
What this means for
Highcroft
Tenant relationships will remain key
in order to maintain valuations and
revenue. The weighted average term
certain for leisure assets within the
portfolio is 12 years and with over 50%
of tenants providing excellent covenant
ratings. Leisure currently represents
13% of the portfolio by value.
Highcroft’s response to
these trends
We are in close contact with tenants
and, where applicable, estate charges
are carefully monitored to ensure best
value for tenants.
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
20
Strategic Report

Office High street retail
Key trends
High inflation is creating greater
cost pressures for corporates, which
is likely to further increase the focus
on cost reduction and productivity.
Although corporate real estate is
the second-highest cost after
salaries for many businesses, the
provision of high-quality space can
also help to increase productivity
and attract talent. This, together
with the longer-term impacts of the
work-from-home revolution, means
that many businesses continue to
assess their real estate footprint, and
are placing an ever-greater emphasis
on smaller, but higher-quality, space.
What this means for
Highcroft
In order to maintain values and
marketability of tenant space, office
space will need to be improved at each
opportunity by engaging with tenants
and property managers. There are two
office assets within the portfolio, which
comprise 10% of the portfolio by value.
Highcroft’s response to
these trends
During 2022, we have undertaken a
refurbishment of c.18,000 sq ft of space
at Cardiff, improving the specification
and marketability of the asset.
Key trends
2022 saw rapidly-rising inflation and
household costs, which resulted in a
decrease in households’ discretionary
spending. We expect similar trends in
2023 as the cost-of-living crisis impacts
the sector.
What this means for
Highcroft
High street retail represents the
lowest exposure within the portfolio
of 5% by value. Company voluntary
arrangements (CVAs) may become
more common throughout the year;
however, the rating revaluation due in
2023 will offer much-needed support
for the sector.
Highcroft’s response to
these trends
A new lease has recently been
agreed in Oxford on a 15-year FRI
basis with the flexibility of five yearly
mutual breaks.
Continual engagement with tenants
and property managers helps us to
understand tenants’ financial strength,
whilst we continue to closely monitor
tenant performance through company
publications, press releases and direct
relationships.
Stock code: HCFT
highcroftplc.com
21

Our values
1
Reputation
Our reputation means everything to us and has been gained by the efforts
of many over several years. Maintaining a strong reputation is critical and
we recognise the value this plays in our relationships with our stakeholders.
Retaining our reputation relies on us doing the right thing and is, therefore,
only achievable with us acting in accordance with all our values and
maintaining a sustainable business.
1
We buy
We research, identify and react quickly to market opportunities,
creating competitive advantage. Using our property
management skills, we create opportunities within our
portfolioto create value and/or yield. We look for:
 Location
 Growth markets
 Areas of decline
 Potential for development
We look to increase our average lot size, to uphold the
qualityof our tenants, grow the portfolio, and navigate
marketuncertainty.
2
We generate
We use a combination of our key resources in order to select
the best opportunities within our chosen market segments,
to asset manage, redevelop or refurbish to increase the value,
sustainability and income-producing capability of our assets.
3
We maximise potential
We maximise the value of our portfolio through redeveloping
and refurbishing properties to meet tenant demands and
maintain relationships to increase lease length and rental
income. This also enables us to make our properties more
sustainable – see pages 48 to 50 for our sustainability journey
and future plans.
4
We sell
We strategically sell smaller lots and properties in
under-performing markets, such as high street retail, to ensure
long-term success – see pages 24 to 25 for the evolution of our
property over the last five years
2
We
g
enerate
1
We
b
u
y
3
We max
i
m
i
se potent
i
a
l
4
We se
ll
Strategy
We aim to deliver
sustainable and long-term
income and capital growth
for shareholders
We endeavour to operate a cyclical
model, buying when the market is
low, generating rental income and
selling, ifappropriate, when the market
is high in order to maximise cash to
reinvest. We use a combination of
our key resources to select the best
opportunities within our chosen
market sectors. We then redevelop and
refurbish these in order to increase the
value of the property, which allows us
to secure higher rental incomes. We
let our properties out on long leases,
guaranteeing consistent income for
our shareholders.
Our key resources
People
We are a small team with diverse
skill sets. Our knowledge and
understanding of the marketplace
informs decisions. As a source of
competitive advantage, the talent of
our staff is integral in prudent decision
making, ensuring that our performance
is in line with ourobjectives.
Financial strength
We have a moderate level of gearing
for a company investing in property.
Our conservative capital structure and
track record of delivering strong returns
make us a lower riskinvestment
than others.
Our tenants
Our tenants are diverse companies
with wide-ranging requirements.
Asshown on pages 12 to 15, they are
mainly large commercial companies
requiring property on long-term leases.
Our key relationships
Our key relationships are with our
tenants, our advisory team and with
local communities.
Key activities
22
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Strategic Report
Our business model

01
03
0204
01
Highly-capable team
Our team has solid experience of delivering
shareholder value in property and listed entities.
For more information on the capabilities of our
team, see pages 55 and 58 to 59.
02
Strong free cashflow
Highcroft consistently generates a strong cashflow,
enabling it to maintain its dividend payments, even
during the Covid-19 pandemic.
03
Diverse range of tenants
During 2022, Highcroft had 21 properties with
28 tenants consisting of 25 covenants.
04
ESG factors
ESG is at the forefront of our strategy. We are
putting in place a plan to ensure that our assets
have strong ESG credentials, which will help to
ensure their longevity for income and value creation.
Underpinning everything we do
Our purpose
To provide our tenants with quality properties, in good locations,
enabling them to succeed and our stakeholders to benefit on a
long-term, sustainable basis.
Competitive
advantage
2
Integrity
3
Good governance
Integrity is a core value in how we conduct our
business and an established part of our strategy.
We gain trust by acting honestly at all times, by being
open and candid in all our business relationships and,
most importantly, in everyone one of our actions. When
engaging with our stakeholders, we act with openness,
honesty, and integrity and the board and employees
take responsibility to ensure that all our business
processes are run with integrity.
The board maintains good governance at the centre
of its decisions and discussions. Our framework
supports the effective delivery of our strategy, the
sustainability of our business and the creation of value
for all our stakeholders continues to be supported
by our governance structures and processes. Whilst
we are a relatively-small premium-listed group, good
governance is a key value and the board endeavours to
follow the appropriate guidance and rules.
Value we generate
Shareholders
Short term
Secure dividend income stream.
Medium term
Maintain dividends.
Long term
Increased shareholder value via sustained capital
andincome growth, arising from our low-risk
businessstrategy.
Tenants
Short term
Supportive landlord/asset manager/tenant
relationships.
Medium term
Improving environments as opportunities to enhance
our properties are identified and actioned.
Long term
High quality environments that help our tenants
succeed with their business strategy.
Society
Short term
Taking cost-effective action to reduce the
environmental impact of our properties.
Medium term
Helping to support the terminally ill and
disadvantaged via our charitable donations.
Long term
Enabling economic prosperity by supporting the
provision of appropriate space in appropriate locations
to encourage employment and business to flourish.
Stock code: HCFT
highcroftplc.com
23

Introduction to our strategy
Highcroft aims to deliver sustainable long-term income
and capital growth for its shareholders through accretive
asset management initiatives and recycling of capital in
its regionally-based property portfolio.
Understanding the external
environment
We pay great attention to market trend forecasts and
consider the impact that these may have on our strategy.
Our decision to rebalance the portfolio away from high
street retail assets, and focus more on industrial and
retail warehousing assets, together with a move to the
larger average lot size, was taken in anticipation of
evolving market trends.
Strategic pillars
1
Building a portfolio of
high-quality commercial
properties in the right places
occupied under good lease
fundamentals by the
right tenants
We will use our core strengths to identify
under-performing or high-risk assets for
disposaland to identify good replacement
assets in our target geographical areas.
2
Using available capital,
including debt, efficiently
andeffectively
We will invest cash as fully as is practicable,
whilst maintaining an adequate headroom of
working capital. We will continue to maintain
conservative gearing levels.
3
Deliver a sustainable income
return to our investors
Whilst having regard to the constraints imposed
by the two main concert parties, we will aim
to manage our asset base effectively and cost
efficiently and to deliver a good dividend return
for our investors on a sustainable basis.
Risk Key
1
Macro-economic outlook
2
Political and regulatory outlook
3
Occupier demand and
tenant default
4
Commercial property
investor demand
5
Availability and cost of finance
6
Business strategy
7
Key personnel
8
Sustainability
Strategic priorities
Continue to grow our commercial
property portfolio with a bias
towards the south of England
and Wales
Increase the average lot size
to £4m–£5m, with no asset
representing more than 15%
of the portfolio
Seek capital growth opportunities
within our property asset base
Use medium-term gearing at
a modest level
Provide a good dividend return
A
B
C
D
E
24
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Strategic Report
Our strategy

Aligning to stakeholders’ interests
All of our strategic priorities, and the associated
risk-management strategies, are developed with a
focus on our overall objective of generating good returns
for our investors with benefits to all our stakeholders.
Sustainability
We strive to conduct our business in an ethical and
responsible manner. Our strategy is underpinned by
this ethos.
How this priority will help us Past progress Future opportunities Risk
Building a portfolio of high-quality commercial properties in the right places occupied by the right tenants with good lease fundamentals
Commercial assets in these
geographical areas are
regarded by the directors
as being best placed to
outperform the market in any
cycle. These locations are also
considered relatively low risk
and fit our risk profile.
We obtained planning permission
on vacant land at our St Austell site
and are in the advanced stages of
awarding a tender for construction.
In February 2023, we sold our vacant
Llantrisant asset for 16% ahead of
the December 2022 valuation.
We will identify suitable
opportunities to invest the
proceeds of our Llantrisant
asset and will develop the new
industrial unit at St Austell.
1
2
3
4
As many costs are directly
related to the number of
assets rather than their
size, increasing the average
lot size should reduce
average property costs,
thereby increasing the net
property income available
for distribution.
Average lot size decreased to
£3.7m from £4.2m, wholly due
to a decrease in the valuation
of the portfolio.
Future growth will come from
revaluation gains, new assets
are being bought that are larger
lots than our average, and
from the disposal of smaller
underperforming units.
As our largest asset, the sale
of Llantrisant will reduce the
average lot size.
3
4
Identifying growth
opportunities will enable,
either, enhanced enhanced
sales prices to be achieved or
improve the yield from our
properties.
We obtained planning permission
on vacant land at our St Austell
site and have let our void Oxford
High Street property. We have also
refurbished and carried out capital
improvement work at our vacant
Cardiff office unit.
Asset management initiatives
to improve sustainability, and
underpin the long-term capital
value of our portfolio, are being
identified.
1
2
3
4
5
8
Using available capital, including debt, efficiently and effectively
The use of keenly-priced
debt to expand our property
portfolio should increase our
net property income.
Our debt remains at £27.2m.
We replaced an expiring facility
during the year with a more
keenly-priced new facility. Interest
rates increased significantly in 2022,
meaning new debt would not add
value to the portfolio.
Our interest rates are now fixed
until 2026 at a weighted average
of 3.06%.
We have headroom with one
lender of £2.8m and would
consider additional gearing
to fund further acquisitions
alongside existing cash resources
if interest rates reduce from their
current levels.
5
6
Deliver a sustainable income return to our investors
Maintenance of a property
income distribution stream
that is increasing is our
priority for enhancing
shareholder value.
Dividends payable for 2022
increased by 1.8% to 56 pence per
share, £2,909,000
As a REIT, we are required
to distribute 90% of our net
property income.
All
Stock code: HCFT
highcroftplc.com
25

Post balance sheet event – 2023 disposal
Warehouse – Llantrisant occupied by British
Airways Avionic Engineering Ltd (BAAE)
December 2022 valuation £6.75m
Disposed February 2023
Gross proceeds £7.85m
Purchased March 2019
Cost £6.95m
Rental income £805k pa
We acquired the virtual freehold interest in this
maintenance, research and development facility
in 2019. The attractive yield, low rent and covenant
strength meant that it fulfilled our purchasing policy
of sourcing assets, which provide attractive returns for
our shareholders. During our period of ownership,
we received £2.5m of gross rental income (net of
a rent-free period), a net yield of 9.3% on cost,
with related property costs of less than £10,000.
During 2022, the tenant vacated the property and,
as the lease was due to expire in March 2024, the
decision was taken to dispose of the property rather
than carry the risk of our largest asset by value, and
income, becoming void.
Heads of terms for the sale were agreed in Q4 2022
and the purchasers were carrying out their due
diligence into 2023. Contracts were exchanged
and completed for the sale on 8 February 2023.
We intend to take action, in a timely manner, to
protect income and net asset value by reinvesting the
proceeds, together with some of our existing cash
resources, into further property assets. We intend to
focus this investment in the industrial sector, with
longer unexpired lease terms, and to choose slightly
smaller assets to avoid concentration risk.
26
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Strategic Report
Our strategy case in action

Stock code: HCFT
highcroftplc.com
27

Financial KPIs
1
Movement in value
of property assets
2
Movement in net
property income
3
Movement in net
asset value
per share
£77.9m £5.3m 1,081p
(11.8%) like-for-like 0.3% (15.2%)
2022
2021
2020
2019
2018
82.1
86.7
77.7
77.9
87.6
2022
2021
2020
2019
2018
5.5
5.7
4.9
5.3
5.3
2022
2021
2020
2019
2018
1,104
1,175
1,207
1,081
1,275
Link to strategy
A C D E
Link to risks
1 2 3
Link to strategy
A B C D E
Link to risks
1 2 3
Link to strategy
A C D E
Link to risks
1 2 3
Why we use this indicator
The value of our commercial
property portfolio, and its movement
on a like-for-like basis versus the
market, give a good measure of the
performance of our assets, on a capital
basis, in the year.
Commentary on performance
The value of our assets has decreased
by £10,381,000, 11.8% on a like-for-like
basis, which is ahead of the
all-property MSCI decrease of 14.1%
and the weighted (to our portfolio)
MSCI average of 13.3%.
Looking forward
The sector and geographical spread
of our assets, together with the lease
lengths and covenant strength, result
in a portfolio that should be stable in
the year, especially given the volatility
in asset values in the wider market.
Why we use this indicator
As a REIT, we are required to distribute
90% of our relevant property profits.
Increasing net property income
contributes towards an increase in
ourdividend.
Commentary on performance
Net property income increased by
£17,000, 0.3% in the year, as a result
of a decrease in rental income of
£320,000 offset by a decrease in
property costs of £337,000, including a
£111,000 reduction in bad debt charge.
Looking forward
In 2023, we hope to build on the
progress made in 2022 where we
have taken steps to further reduce
bad debts and to deal with
dilapidations and void costs arising
at our empty unit. As we sold the
Llantrisant asset in February 2023,
we will be focussing on reinvesting
the proceeds in good time in order
to generate replacement income.
Why we use this indicator
Net asset value per share measures
the value of shareholders’ equity in
the business. It gives a simple, clear
message of the overall performance,
taking into account asset performance,
the result for the year and dividends to
shareholders.
Commentary on performance
Net asset value per share decreased by
15.2% in 2022, primarily, as a result of
the decrease in our property valuation
and the net decrease arising from our
revenue profits net of dividends paid
in the year.
Looking forward
The market remains volatile in late
2022 and early 2023; our asset base
is good and we believe that it is
positioned to hold firm in 2023.
Read more about our risks on pages 38 to 45
Read more about our portfolio on pages 10 to 15
The following key performance indicators are considered to be the most appropriate for
measuring how successful the company has been in meeting its strategic objectives.
Strategic Report
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
28
Our key performance indicators (KPIs)

Non-financial KPIs
4
Achieve an adjusted
EPS per share
that is in line with
the market
5
Average
occupancy levels
6
Maintain the
quality of our
tenant covenants
94%
This KPI was new in 2020
2022
2021
2020
2019
2018
99
100
100
94
93
Link to strategy
E
Link to risks
1 2 3
Link to strategy
E
Link to risks
1 2
3
Link to strategy
E
Link to risks
1 2 3
Why we use this indicator
This KPI measures our adjusted
earnings per share and compares it to
the MSCI income return for the year
weighted to our portfolio. This links
our performance for our shareholders
to the performance of the market as
awhole.
Commentary on performance
Performance in 2022 was above the
MSCI income return for the year,
which reflects the effect of the lower
property costs and tax charges net of
the reduction in gross rental income.
Looking forward
It is hoped that future performance
will continue at, or above, market
levels, especially if we can fill our
vacant property and reinvest cash
from the sale of our Llantrisant
property.
Why we use this indicator
This indicator is a measure of the
extent to which we are maximising
income and minimising void costs.
Commentary on performance
We had 94% occupancy at the year
end due to a void at one of our
properties. We relet one void unit
during the year.
Looking forward
We are focussing on ensuring that
we have the best strategy in place
to minimise the effect of our void
Cardiff property.
We are pursuing lease renewal
negotiations as our 2023 lease
expiries.
Why we use this indicator
This indicator signals the quality of
our long-term income stream.
Commentary on performance
We continue to have the majority
of our properties let to strong
covenants.
Looking forward
The strength of the covenant will
remain important in assessing
new acquisitions and tenancies
and forms part of our process in
assessing expected credit losses.
Adjusted EPS
% return
Weighted
market return
2022 4.9 4.5
2021 5.1 6.6
2020 5.8 5.5
Stock code: HCFT
highcroftplc.com
29

Review of the year by outgoing chief executive Simon Gill
Property income
2022 2021 2020 2019 2018
Contracted annual rent at year end £5,710,000 £5,700,000 £5,907,000 6,253,000 5,025,000
Increase/(decrease) in year 0.2% (3.5%) (5.5%) 24.4% 1.2%
Occupancy 94% 93% 99% 100% 100%
The start of 2022 witnessed a return of confidence to the
property market after the difficulties experienced due to the
pandemic in the previous two years. Investment volumes
picked up with the anticipated certainty of future income
streams and the attraction of low interest rates. The £29.6bn
transacted during the first six months of the year was ahead
of the 2021 figure of £27.5bn, and well above the five-year
H1 average of £25.7bn. The perceived stable UK economy
continued to attract foreign investors.
The industrial/warehouse and retail warehouse sectors,
which, when combined, make up 72% of our portfolio,
witnessed good growth in values in the first half of 2022,
and our assets increased in value by 7% and 6%, respectively.
However, Amazon’s announcement that it had satisfied
its criteria and was no longer taking more distribution
space sent a shiver of uncertainty through the market.
The combination of the war in Ukraine, the resulting fuel
crisis, rising interest rates and inflation led to a significant
downgrading in valuations in the second half of the year.
Once again, the high street struggled with a record number
of units vacant – the majority of which will be long term.
With the government’s reclassifying of property-use classes,
the introduction of category E will see some of these
properties change to more purposeful uses and a mix in the
high street not seen for many years. This was a necessary
step to ensure that the high street survives, but in a format
more suited to today’s society. Retail accounts for only 5% of
our portfolio.
The office sector has been slow to recover/pick up from the
lockdown/work-from-home rules, with a large percentage
of the population having become accustomed to working
from the comfort of their homes and proving reluctant to
return to the daily commute. The take up of new space has,
therefore, been very limited and, as a consequence, yields
have risen rapidly. Our office holdings constitute just 10%
ofour portfolio.
2022 proved to be a year of two halves; there were
meaningful increases in values in the industrial/warehouse
and retail warehouse sectors in H1, but the second half of
the year evidenced a significant market slowdown in these
sectors, and the investment market generally, due to rapidly
increasing interest rates and inflation. This led to a decrease
of 11% in our valuations for the year. This compares to the
MSCI all property value decrease of 14.2%
Relative to the market, the portfolio has performed well and
shows that having a good and diverse portfolio and tenant
mix has helped.
Property acquisitions and disposals
We made no acquisitions or disposals in 2022, but
concentrated on the management of our existing portfolio
and ensuring our tenants had fully recovered from the
pandemic effects of the preceding two years. We obtained
planning consent for a c.28,500 sq ft warehouse on land that
we obtained vacant possession of following a lease regear
at our holding in St Austell in 2021. Terms have now been
agreed for a pre-let to a distribution company, and works
are to commence shortly with a planned completion date
of December 2023.
During the year, we let our one vacant retail unit in High St,
Oxford leaving our offices in Cardiff as the only vacant
property in our portfolio.
Paul Leaf-Wright
Chief executive
30
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Strategic Report
Operating review

Sector balance
The sector balance in our portfolio is now, by valuation:
2022
%
2021
%
2020
%
2019
%
2018
%
Warehouse 45 45 46 42 39
Retail warehouse 27 28 26 27 33
Leisure 13 12 12 14 9
Office 109999
High street retail 567810
Total 100 100 100 100 100
Our aim to reduce our exposure to the high street continues as we consider that, with a few exceptions, there is limited
growth in this sector.
Delivering against our strategy
Stock code: HCFT
highcroftplc.com
31

Looking forward by incoming chief executive Paul Leaf-Wright
Introduction
It has been great to be welcomed in as chief executive
of Highcroft from I January 2023 and to work alongside
Simon Gill and Roberta Miles as executive directors. Simon
will resign from the board on 31 March 2023, and I am
pleased to report that the handover is well progressed.
Highcroft has a well-established property portfolio and
business plan, and my aim is to continue on its path of
delivering a sustainable dividend flow to shareholders.
In February 2023, we sold the Llantrisant property for £7.85m,
being £1.1m above the 31 December 2022 external valuation.
Given that the lease was due to expire in March 2024,
and the tenant had already vacated, this was an excellent
outcome for the company. The annual rent payable of
£805,011 represented an attractive 11.6% yield on the original
cost and being able to exit above carrying value and cost
means the asset value was also protected.
We are focussing on finding suitable new investment for
these funds, which we hope to do in the short term so that
we can generate rental income for the remainder of the year.
The portfolio is in good shape, with only one vacancy
being the Cardiff property, following its refurbishment and
improvement during the year. We are currently working on
ensuring the best possible asset management result for
thisasset.
Our year-end gearing remained conservative at 36% and the
next facility letter renewal is not due until 2026. Further to
our last facility renewal in May 2022, which resulted in a lower
weighted average loan interest rate for the group, we have
been well protected against the increases in interest rates
experienced over the last few months. Our aim is to keep
gearing at around these levels and, hopefully, when time
comes for new facilities or facility renewals, the base rates
will have declined from their currentmoderately high levels.
This is, certainly, what thecurrent economic forecasts would
seem to indicate.
The team
Roberta Miles as finance director is a great support and has
established very good systems and controls to ensure the
highest possible standards of accounting and reporting,
especially considering Highcroft is a fairly small company.
She is well supported by Anne-Marie Palmer as company
secretary and by Alison Henley as financial accountant.
In changing roles, we have appointed Cube Asset
Management Limited (Cube) as property advisers. They have
a small team and will focus on the portfolio composition,
sustainability, tenants, leases and repairs/maintenance of
theproperties.
This move gives the company access to a broader, focussed
team to assist in looking after the property portfolio. All
decisions relating to the properties will continue to be made
by the board, but we will benefit by having access to the
skills and advice of the whole Cube team.
This restructuring of roles has been achieved without
increasing the cost base of the group.
Strategic Report
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
32
Operating review continued

Corporate governance
The company has well-documented policies and procedures
and these are controlled and implemented by both the
board and management.
Whilst Highcroft is a small company, we strive to ensure
thehighest possible standards. Through the use of
externalservice providers, such as property managers,
lawyers and auditors, we are able to extend our reach
anddepth of controls.
Key areas of compliance where there is strong focus are
financial reporting, meeting bank covenants and REIT
criteria and ensuring that we follow best practice with
ourESG policies.
The year ahead
The challenge will be to, firstly, invest the group’s cash
reserves into quality, income-producing assets. One of
these will be the development of the land parcel we have in
Cornwall for a distribution-company-tenanted warehouse.
We are well advanced with the negotiations for all the
agreements for this; including an agreement for lease with
the potential tenant. Construction is expected to complete
in H1 2024 and will cost around £4.3m. This will add a £4.3m,
brand-new asset to the portfolio.With other cash resources,
we aim to buy one or two other properties to ensure we are
fully invested as soon as practicable.
Currently, all acquisitions will be funded with cash and no
new gearing will be sought as it is our view that borrowing
rates are too high to effectively add any value to the
investment case. Should rates reduce over time, or a specific
investment opportunity arise, this will be revisited and
suitable gearing can be introduced. We have additional
capacity within our existing facilities with Handelsbanken plc.
On behalf of the company, I would like to thank Simon Gill for
all his input over the past years and wish him all the best for
the future.
Paul Leaf-Wright
Chief executive
27 March 2023
Stock code: HCFT
highcroftplc.com
33

Overview
2022 2021
Profitability
Net rental income £5,275,000 £5,258,000
Adjusted earnings per share 62.9p 56.7p
IFRS (loss)/profit for the year (£7,116,000) £11,944,000
Net admin expenses to
gross rent 21.2% 19.6%
Investment returns
Net asset value per share 1,081p 1,275p
Dividend payable per share 56p 55p
Total shareholder return 12.7% 29.6%
Return on equity (11.6)% 19.4%
Financing
Net debt 19,994,000 21,485,000
Net debt to property value 26% 25%
Average cost of debt
at the year end 3.06% 3.1%
The group has, again, shown resilient performance during
2022, a year dominated by the conflict in Ukraine, the legacy
effects of the Covid-19 pandemic, political uncertainty
and the high inflationary pressures at the end of the year.
Against this backdrop, our gross rental income fell by 5% as
a result, primarily, of a combination of the negative effects
of voids and our 2021 property disposal offset by positive
asset management activity. Property operating expenses fell
significantly by £337,000 to £333,000. These costs comprised
property costs arising from our ongoing asset management,
costs arising from our void properties, and a bad debt
charge of £31,000. Costs in 2021 included a one-off provision
of £174,000 for dilapidations expenditure, which were
mostly funded by the one-off income from the tenant.
Our administration expenses increased in the year by
2%, with director and staff costs increasing in line with
the additional internal work required, offset by a small
reduction in external professional fees. Our underlying
adjusted revenue profit before tax (excluding revaluation
gains and gains on disposals) remained stable at £3,283,000
(2021 £3,243,000). The one-off taxation charge of £304,000
in 2021 arose from the reduction of our PID pool by £1.6m
made under HMRC concession as a result of the Covid-19
pandemic.
Net assets have decreased by 15% to £56,176,000 and we
have a low net-debt-to-property value of 26%. The average
cost of debt at the year end is 3.06% with the reduction in
interest payable arising in the year due to the refinancing
of one loan during the year at a lower rate than the expiring
facility. Our investment properties decreased in value by
£10,381,000 (11.8% on a like-for-like basis).
We are proposing a final dividend for 2022 of 33p per share
giving a total dividend for 2022 of 56p per share, an increase
of 2% from the 2021 dividend of 55p per share. Since 2009
(our first full accounting year as a REIT), our dividends have
risen by a total of 115% – a compound annual increase of 6.1%.
In the same period, our net assets per share have increased
by 62% from £6.66 to £10.81 per share.
Income
Total income has decreased by 5%.
2021
6,084
2020
5,840
2019
5,035
2018
6,500
6,000
5,500
5,000
4,500
4,000
£’000
5,928
5,608
Total
£’000
5,928
2022
5,608
8
54
3
5,843
6,084
5,097
Commercial property income
Residential property income
Income from equity investments
Roberta Miles
Finance director
34
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Strategic Report
Financial review

2021 2022
Negative effect
of voids
(201)
5,608
5,928
5,608
2022 gross
rental
income
Other
(79)
Reduction in
one-off income
(140)
6,000
5,000
7,000
4,000
£’000
Negative effects
of disposals
(120)
2021 gross
rental
income
Positive effect of
asset management
220
The annual movement in our property income can be summarised as:
2022
%
2021
%
2020
%
2019
%
2018
%
(Decrease)/Increase in gross rental income (5) (3) 4 16 6
Administration and otherexpenses
2022
£’000
2021
£’000
2020
£’000
2019
£’000
2018
£’000
Directors’ remuneration 877 837 801 597 541
Auditor’s remuneration including other services 70 64 58 35 32
Other expenses 244 263 210 194 163
Administration expenses 1,191 1,164 1,069 826 736
Net finance expense 801 851 892 850 699
Total expenses 1,992 2,015 1,961 1,676 1,435
Director’s remuneration rose by 5%, primarily, due to four years of the share element of the Highcroft Incentive Plan being
expensed in the year (2021 three years), and an increase in base salaries for the board offset by the reduction in remuneration
for the new non-independent, non-executive director. More detail can be found in the directors’ remuneration report on
pages 72 to 83. Other expenses have reduced by 7% as a result of reduced professional costs associated with our status
as an associated undertaking of Kingerlee Holdings Limited and a reduction in recruitment fees. We added a part-time
company secretary to our small team in October 2021, to strengthen our internal governance and improve the robustness
of our organisation, and 2022 includes a full year of that cost. Net finance expenses decreased as a result of a part year’s
saving arising from our £7,500,000 loan refinancing in May 2022, when the new fixed interest rate was lower than that on the
maturing loan.
Our 2022 performance
was resilient during
a turbulent year
Stock code: HCFT
highcroftplc.com
35

Summary of profit before tax andincome tax credit on revenueactivities
2022
£’000
2021
£’000
2020
£’000
2019
£’000
2018
£’000
Profit before tax 3,283 3,243 3,503 3,983 4,445
Income tax (charge)/credit (18) (304) – 72 67
Profit for the year 3,265 2,939 3,503 4,055 4,512
The increase in the revenue profit for the year in 2022 of £326,000 was the result of an increase in net rental income of £17,000,
a decrease in net finance expenses of £50,000, a decrease in tax charge of £286k offset by an increase in administration
expenses of £27,000. The tax charge in 2021 arose from the adjustment to the 2019 PID pool made in 2021 using the HMRC
Covid-19 concessions.
Investments
2018
77,700
90,000
70,000
£’000
Total
£’000
2020
82,060
£82,060
2021
87,565
£87,565
2022
77,910
£77,910
£78,379
2019
86,710
679
£86,710
80,000
60,000
Our investments decreased, primarily, due to valuation losses net of additions. There were additions at two of our assets related to
improvements at our Cardiff property and pre-development work at our asset at St Austell. There were no disposals in the year.
Summary of property investmentactivities
2022
£’000
2021
£’000
2020
£’000
2019
£’000
2018
£’000
Additions at cost 726 – – 11,898 5,226
Net proceeds from disposals – (3,500) – – (6,090)
Net investment/(divestment) into/(from) the
property portfolio 726 (3,500) – 11,898 (864)
Realised and unrealised propertygains
Our valuations are undertaken by Knight Frank LLP as reported in Note 8 to the consolidated accounts. The capital
performance of our property portfolio can be summarised as follows:
2022
£’000
2021
£’000
2020
£’000
2019
£’000
2018
£’000
Realised gains on investment property – 250 – – 967
Revaluation gains on investment property 605 9,925 2,525 739 2,600
Revaluation losses on investment property (10,986) (1,170) (7,175) (3,627) (2,116)
Net revaluation gains/(losses) (10,381) 8,755 (4,650) (2,888) 484
Overall, our property portfolio decreased in value during the year by £10,381,000, which represents -11.8% on a like-for-like
basis. Our most significant revaluation gain related to our Llantrisant property, which increased by 8% during the year and
was sold in February 2023 for a further 16% gain. The most significant revaluation losses were in some of our high street retail
and industrial assets, where a move in market sentiment has resulted in a reduced valuation. The revaluation movement is
summarised by class of asset in the following table.
Commercial property
Equities
Strategic Report
36
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial review continued

Valuation gains and losses by type Valuation movement
Movement to opening
valuation plus additions
Office (644,565) -7.8%
Industrial (5,206,113) -13.0%
Retail (905,000) -18.2%
Leisure (875,000) -8.1%
Retail warehouse (2,750,000) -11.3%
(10,380,678) -11.76%
Financing and cashflow
Net cash generated from operating activities was £1,624,000 higher at £5,126,000. This increase arose from a £1,255,000
decrease in working capital requirement, a £50,000 reduction in net finance expense, an increased profit from operations
before changes in working capital of £14,000 and a decrease in tax paid of £304,000. It is the directors’ intention to reinvest
surplus cash, that is not required for PID payments, into the commercial property portfolio when suitable opportunities arise.
2022
£’000
2021
£’000
2020
£’000
2019
£’000
2018
£’000
Opening cash 5,715 3,295 1,559 5,202 1,904
Net cash from operating activities 5,126 3,502 3,220 3,560 3,620
Investment acquisitions – property (726) – – (11,898) (5,226)
Investment disposals – property
1
– 1,925 – – 6,090
Investment disposals – equities –––7241,333
Dividend paid (2,909) (3,007) (2,484) (2,829) (2,519)
Net new bank borrowings – – 1,000 6,800 –
Closing cash 7,206 5,715 3,295 1,559 5,202
1 For 2021, net of proceeds of £1,575,000 transferred into a deposit given as bank security and included in other receivables in Note 10 to the consolidated financial
statements. The secured deposit was released in April 2022 and this movement in working capital is included in the decrease in working capital requirement in 2022.
Analysis of borrowing
2022
£’000
2021
£’000
2020
£’000
2019
£’000
2018
£’000
Handelsbanken term loans 2030 5,000 5,000 5,000 – –
Handelsbanken term loans 2029 14,300 6,800 6,800 6,800 –
Handelsbanken term loan 2027 4,500 4,500 4,500 4,500 4,500
Handelsbanken term loan 2026 3,400 3,400 3,400 3,400 3,400
Handelsbanken term loan 2022 – 7,500 7,500 7,500 7,500
Handelsbanken term loans 2020 – – – 4,000 4,000
Total debt 27,200 27,200 27,200 26,200 19,400
Cash (7,206) (5,715) (3,295) (1,559) (5,202)
Net debt 19,994 21,485 23,905 24,641 14,198
Net assets 56,176 66,117 57,121 60,721 62,384
Gearing (net of cash) 36% 32% 42% 41% 23%
Our weighted average cost of total debt is 3.06% (2021 3.13%).
Outlook
We believe that the quality of our assets, our ongoing asset management programme, and spread of sector risk, all combined
with our concentration of assets in the south of England and Wales, means that we are in a strong position to deliver a secure
dividend return to our shareholders.
We remain optimistic about the prospects for the group and its ability to meet its strategic objectives in the medium and
long term.
Approved by the board and signed on its behalf by:
Roberta Miles
Finance director
27 March 2023
Stock code: HCFT
highcroftplc.com
37

Risk framework
The company has a well-established risk management
and internal control framework. The board has overall
responsibility for risk management with a focus on
determining the nature and extent of exposure to principal
risks the group is willing to take in achieving its strategic
objectives. The amount of risk is assessed in the context
of the core strengths of our business and the external
environment in which we operate.
The board believes that effective risk management is
integral to our strategy of delivering long-term sustainable
income and capital growth.
Strategic risk management
reporting
Board of directors
Overall responsibility for risk management
Regular review of effectiveness of system of
internalcontrol
Regular assessment of emerging and principal risks
Audit committee
Assurance of risk management process
Executive committee
Day-to-day risk management
Ongoing identification, assessment and mitigation of risk
Design implementation and evaluation of system
ofinternal control
Ensuring operational effectiveness of control systems
Our approach to risk management is to identify the
financial, operational and compliance risks that may prevent
the attainment of our strategic objectives, or impact our
future performance, solvency or liquidity. We evaluate the
risks and take any appropriate action to reduce or remove
the likelihood of these having a material impact. Thisprocess
is regularly monitored and reviewed.
At the point any key strategic decision is taken, the potential
risks are considered. Effective risk management is an
important part of our board decision-making process.
All directors are kept up to date with key issues on, at least,
a monthly basis. The small size of the management team
and regular consideration of risk areas means we can
respond quickly to changes in the risk environment.
The principal risks that have been identified, and the
management and/or mitigation of these, are set out on
pages 39 to 43. The board has identified that emerging
risks are likely to be linked to our existing principal risks and
these are also included, as appropriate, in the table on pages
40 to 43.
Against the backdrop of economic and political challenges
due to the continued impacts of the conflict in Ukraine,
the legacy impacts of the global Covid-19 pandemic,
high inflation, and high interest rates in the UK, we have
continued to actively manage our risk exposure
by maintaining a high occupancy across our portfolio
and an efficient capital structure andliquidity position.
Risk appetite
Whilst risk is an integral part of our business, the general
appetite of the group for risk is low.
Changes to our principal risks
The principal risks and uncertainties that faced the group
in 2022 are set out on pages 40 to 43, together with the
mitigating actions and controls in place. We define a principal
risk as one that is currently impacting on the group or could
impact the group over the next 12 months. These principal
risks are not a complete list of all risks facing the group, but
are a snapshot of the group’s risk profile as at the date of this
report. In order to manage our risks more effectively, we have
made a slight modification to their titles as follows:
2021 2022
Risk 1 Macro-economic
outlook
Macro-economic and
political outlook
Risk 2 Political and
regulatory outlook
Regulatory and
compliance burden
New principal risks or new factors
affecting existing principal risks
The ongoing conflict in Ukraine affecting the
macro-economic outlook
The conflict in Ukraine does not directly affect our
business, which is focused in the UK. However, the overall
UK economy, which includes our tenants’ supply chains
and their customers, is potentially adversely impacted. In
particular, the significant rise in energy costs arising from
the conflict affects our tenants’ cost-base and the availability
of discretionary spend by their customers.
The political environment and highinflationary
and interest ratepressures in the UK affecting
themacro-economic outlook
In the second half of 2022, the changes of prime minister,
and the negative effects of the mini-budget in 2022
and the subsequent quick-fire policy reversals, created
uncertainty in the UK and a widespread negative response.
The mini-budget was delivered against the backdrop of a
cost-of-living crisis and was followed by a sharp fall in the
value of sterling against the US dollar. The subsequent
leadership change has not yet restored the desired
economic stability. Interest rates continued to rise with a
total of eight increases in 2022. UK Corporation Tax is also
due to rise to 25% in Q2 2023.
The group is sheltered from interest rate rises as its debt
is long term and on fixed rates with the next maturity in
2026. It is also sheltered from corporation tax rises due to its
REIT status. The major effect of these changes is on all our
stakeholders – particularly our tenants and their customers.
The board continues to pay close attention to the evolving
situation and to mitigating the risks for our business and all
our stakeholders.
Strategic Report
38
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Our risks

Risk heat map
The risk heat map below illustrates the principal risks that have the potential to, significantly, impact the group’s strategic
objectives, financial position or reputation. It highlights net risk, after taking account of principal mitigations.
Low HighImpact
Low HighLikelihood
1 3
2
6
8
7
4
5
1 3
7
6
5
4
8
2
Principal risk key
Link to strategic
objectives
External risk
1
Macro-economic outlook
including Covid-19
A B E
2
Political and regulatory
outlook
A B E
3
Occupier demand and
tenant default
A B E
4
Commercial property
investor demand
E
5
Availability and cost
offinance
D E
Internal risk
6
Business strategy
A B C D E
7
Key personnel
A B C D E
8
Sustainability
A B E
As at 28 March 2022
As at 27 March 2023
Strategic priorities key
The objective of the group is to enhance shareholder value via a combination of increasing net asset value,
profits and dividends.
We set clear strategic objectives against which we measure our performance:
A
Continue to manage our commercial property portfolio with a bias towards the south of England and Wales
B
Increase the average lot size to £4m-£5m with no asset representing more than 15% of the portfolio
C
Seek capital growth opportunities within our property asset base
D
Use medium-term gearing at a modest level
E
Provide a good dividend return
Read more about our strategy on pages 24 to 27
Stock code: HCFT
highcroftplc.com
39

Principal risk How we manage/mitigate the risk
External risks
1
Macro-economic and political outlook
The UK economic climate, any further adverse
consequences of the conflict in Ukraine, the rise in
UK interest rates and in the cost of living, present
both risks and opportunities in the property and
associated financial markets. This could impact
the delivery of our planned revenue and capital
strategy.
 Monitoring of both political strategy and economic and
property industry research by the executive team and
review at board meetings, and adjustment of strategy
as necessary.
 Our activities are restricted solely to the UK with no
foreign exchange exposure.
 Use of advisers, as appropriate, when considering
key transactions.
 Ongoing review of tenant, asset and sector profile.
2
Regulatory and compliance burden
There is an ever-increasing regulatory burden both
as a listed entity, a property company and as a REIT.
 We use our company secretary and our advisory team
to ensure that the board remains up to date with the
evolving regulatory requirements for a listed real estate
company.
 We use a board portal to enhance our governance
communication, systems and procedures.
3
Occupier demand and tenant default
Further weakening in the UK economy, reduced
consumer confidence, business activity and
investment could result in tenant administration/
CVA and reduce income, rental growth and capital
performance.
 We review market data and industry trends with our
advisers, to assess whether any risk-mitigating steps
need to be taken.
 Our strategy is to invest in the lower-risk areas of the
south of England and Wales.
 Our strategy to invest across different sectors reduces
our exposure to an individual sector or tenant.
 We maintain close relationships with our tenants and
support them through their business cycle.
 We review the managing agents rent collection reports
regularly and take action, where necessary.
4
Commercial property investor demand
Any drop in, amongst other things, the health of
the UK economy, or in the availability of finance,
or the attractiveness of sterling, may result in a
reduction in investor demand for UK property,
which may result in a fall in our asset valuations.
 We review market data together with industry trends
with our advisers, to assess whether any risk-mitigating
steps need to be taken.
5
Availability and cost of finance and debt
covenant requirements
Bank of England monetary policy may result in
interest rate rises resulting in future increased costs
of borrowing. Reduced availability of appropriately
priced finance would affect our ability to refinance
debt and/or increase cost.
Breach of debt covenants could trigger loan
defaults and require repayment of facilities.
 The board aims to only assume a moderate level of
gearing, thereby increasing the likelihood of being
seenas an attractive banking proposition for lenders.
Our preference is for fixed-interest, non-amortising
debtwith a spread of maturity dates. We monitor
our LTV and debt requirements and maintain good
long-term relationships with our current and potential
financing partners.
40
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Strategic Report
Our risks continued

Commentary
Change in risk
assessment in
the year
Link to
strategic
priority
During 2022, the economic environment in the UK deteriorated significantly,
as nothwithstanding the lessening impact of the Covid-19 pandemic,
the political turmoil in the UK and associated policy changes, negatively
impacted the economic outlook. Interest rates in the UK are now, relatively,
high and inflation continues to be in excess of 10%. There remains a level of
uncertainty regarding the future outlook.
Our property valuations have fallen as a result of the downturn in market
sentiment during the second half of 2022.
In 2023, we will continue to carry out our control, management and
mitigation procedures.
A B E
Listed real estate company compliance requirements continue to increase.
In 2022, in considering the replacement process for the chief executive, we
decided to outsource part of the existing holder’s responsibilities to a team
of property specialists, leaving only the core chief executive responsibilities
in-house. We believe that this will help broaden the depth of skills available
tothe company.
A B E
After the sale of our Llantrisant property in February 2023, we now have 20
properties with 28tenants and 25 individual covenants. At the year end, one
of our properties is void representing 6% of the annual rent roll. Our bad debt
charge for the year is £31,000, which represents 0.6% of gross rental revenue.
The weighted average lease expiry is five years, which provides a reasonable
longevity of income. In investing the proceeds from the sale of the property
in February 2023, we will seek to increase the average lease expiry.
In 2023, we will continue to carry out our frequent reviews and controls.
A B E
During 2022, in the light of the worsening macro-economic situation, the
property market worsened and transaction rates reduced. Our portfolio
reduced by 11.8% on a like-for-like basis compared with the MSCI all property
result of 14.2% decrease.
In 2023, we will continue with our current controls and will look to take
opportunities to invest or divest at particularly opportune points in the
property cycle, as we did in February 2023 with the sale of our Llantrisant
property for in excess of the year-end valuation. More details onpage 26.
E
During 2022, we refinanced a £7.5million facility at a lower interest rate than
the expiring facility, generating annual savings of £17,000.
Our next loan maturity is in August 2026.
If we wish to draw additional debt, we have pre-agreed headroom of £7.8m,
subject to terms and security, and this includes a £1 million overdraft facility.
In 2023, we have carried out our annual review with our current lender and
will continue to conduct our monitoring procedures.
D E
41
Stock code: HCFT
highcroftplc.com

Principal risk How we manage/mitigate the risk
Internal risks
6
Business strategy
If the group has the wrong strategy for the
current stage of the property cycle and the
macro-economic climate, there will be reduced
profitability and capital values.
 Our strategy is determined to be consistent with
our stated risk appetite of low, and is based on our
evaluation of the macro-economic environment.
Individual investment or divestment decisions are
madeby the board and subject to a risk evaluation.
7
Key personnel
A number of critical business processes lie in the
hands of a few people. Failure to recruit, develop
and retain staff and directors with the right
skills and experience, may result in significant
underperformance, or impact the effectiveness of
operations and decision making, in turn, impacting
business performance.
 Remuneration packages are reviewed annually
to ensure that the group can retain, motivate and
incentivise key staff. We outsource a number of key
routine processes to minimise the risk of business
interruption. Succession planning and the composition
of the board are regularly reviewed by the nomination
committee, and the board reviews the key advisers,
at least, annually. Future recruitment may require the
use of a head hunter to source candidates with the
appropriate skillset.
8
Sustainability
If the group fails to address climate-related
risks in the short, medium and long term, the
company’s assets and its licence to operate could
be challenged.
 Sustainability is considered as part of our risk
discussions at all board meetings and in all our
investment processes.
Strategic Report
42
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Our risks continued

Commentary
Change in risk
assessment in
the year
Link to
strategic
priority
During 2022, a year still dominated by the global pandemic, our capital
performance was close to the market and our rent collection was 100%.
In 2022, we held our annual strategy away day to discuss the group’s five-year
strategy, monitor our portfolio for further asset management activities and
manage the void rate, examine opportunities for acquisitions and disposals
to recycle capital, and consider all risks facing the business.
A B C
D E
In 2022, we considered our approach to the replacement of Simon Gill as
chief executive. In order to reduce risk, it was agreed that the duties of the
current role would be split, the property management aspects would be
outsourced, and the pure chief executive aspects would be condensed into
a smaller role. Paul Leaf-Wright joined the board on 1 January 2023 as chief
executive in this newly-defined role.
The remuneration policy has been reviewed by the remuneration committee
and a new policy has been proposed that is more proportionate to
Highcroft’s size and the nature of its business.
A B C
D E
Our EPC assessment and improvement strategy is in the initial phase of its
implementation. Construction at St Austell will be to a BREEAM ‘very good’
standard of specification and we incorporated certain sustainable features
such as LED lighting, cycle spaces and showers during our Cardiff office
refurbishment. Further details are available on page 49.
A B C
D E
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43

Viability statement
Assessment of viability
In accordance with provision 31 of the Code, the directors
have assessed the viability of the group over a longer
period than the 12 months required by the ‘going concern’
provision. The board conducted this review for a period of
five years to coincide with its detailed review of the group’s
financial budgets and forecasts. The period is consistent
with the periods until the next lease event on many of our
properties, and includes the dates of expiry of our next two
expiring term loans, which represent 29% of our total debt.
This five-year period is considered to be the optimal balance
between the long-term strategy of delivering sustainable
income and capital growth, and the fact that property
investment is a long-term business, counterbalanced by the
inherent uncertainties involved in medium to long-term
forecasting in an industry that has been cyclical in nature.
The board, in conjunction with the audit committee,
carried out a robust assessment of the principal risks and
uncertainties facing the group, including those that would
be a major challenge to its resilience by threatening its
business model, strategy, future performance, solvency, or
liquidity over the five-year period. This review provided the
board with assurance that the mitigations and management
systems are operating as intended.
The board receives regular, at least monthly, briefings
from the executive team, which include rent collection
data, portfolio updates, including tenant discussions, debt
covenant measures and a review of the principal risks and
any adverse movements in risk exposure. A detailed paper is
presented to the board at each board meeting on matters
affecting viability and going concern.
The board considered the group’s cashflows including the
required cashflows to meet the dividend requirement of
the REIT regime, REIT compliance, income profile, loan
to value and other key financial metrics. The board has
also considered the level of property capital transactions
that are likely to occur and noted that no loan facilities are
due to expire until 2026 and that there is headroom with
Handelsbanken to draw an additional £7.8m of debt subject
to terms and security.
The board also conducted a sensitivity analysis, considering
the potential impacts of the occurrence of one, or more,
of the group’s principal risks, as set out on page 33. In
particular, the board considered the effect of the following
sensitivities during the forecast period:
 A 10% drop in income during the forecast period;
 A 20% increase in our proposed capital expenditure
programme; and
 An increase in the assumed forecast inflation rates of 5%.
The board has noted that the BEIS consultation has
proposed the introduction of a resilience statement in future
periods and that they will not be proposing to adopt this
proposal earlier than required. In assessing the viability of
the business, they have considered the material challenges
to reliance over the short, medium and long term, and will
report more fully on this as best practice evolves.
Viability statement
Having considered the forecast cashflows, covenant
compliance, and the impact of the sensitivities, the
directors confirm that they have a reasonable expectation
that the group will be able to continue in operation
and meet its liabilities as they fall due over the period to
31December 2027.
Strategic Report
44
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Our risks continued

Going concern statement
Assessment of going concern
The directors have assessed the group’s ability to continue
as a going concern. This includes a review of the continuing
uncertainties created by the conflict in Ukraine, the
legacy effects of the Covid-19 pandemic, and the current
political climate and high inflation environment in the UK,
particularly as these impact rental income, the group’s cash
resources, borrowing facilities and dividend distributions.
The group’s business activities, together with the factors
likely to affect its future development, performance
and financial position are set out in the strategic report.
Thefinancial performance of the group for 2022, including
its cashflows, liquidity and borrowing facilities, are set out in
the financial statements with additional information in the
financial review on pages 34 to 37. Note 18 to the accounts
on pages 112 to 113 includes information on the group’s
financial instruments and on its approach to credit and
liquidity risk.
At 31 December 2022, the group had £7.2m of cash and cash
equivalents and fixed-term, fixed-interest, non-amortising
borrowing of £27.2m, which expires during the period
August 2026 to July 2030, an undrawn overdraft facility
of £1m and additional headroom of £1.8m. As described
on page 26, the group completed on the sale of one of its
property assets in February 2023 with gross cash proceeds of
£7.85m. The first facility maturity is in August 2026 for £3.4m.
The group has a modest gearing of 36% and its net debt to
investment property valuation is 26% at the year end.
During March 2023 the group finalised its annual review with
Handelsbanken plc. The group now has approved headroom
limits up to an increased total of £35m of which £27.2m are
currently drawn. The £7.8m of undrawn headroom limits
can be used, subject to terms and security for short-term or
longer-term funding requirements.
Our primary debt covenants relate to interest cover and
the loan-to-value ratio. They are tested annually, and
the LTV covenant is based on the valuations addressed
to the bank(which may not be the same as the current
valuations). Inorder to respond to a potential shortfall in
theLTV covenant as a result of a reduction in valuation of our
secured properties, the group gave an additional property as
security during the year.
The group has a secure property income stream from
28tenants with no undue reliance on any one tenant.
Wehave been unable to secure a new tenant for our
refurbished and improved Cardiff property, for which the
lease ended in June 2021. Based on this experience, the
board has carefully reviewed its forecast assumptions
regarding potential void periods and lease incentives at
break dates and lease ends. In addition, we have one tenant
with whom we are in an ongoing arrangement regarding
their arrears position and where we had to take further
action to recover the sums owed to us. Notwithstanding
the fact that Covid-19 pandemic has eased in the UK, and
that the Ukraine conflict does not directly impact our
assets, which are all in England and Wales, there remain
uncertainties arising from supply chain issues, due to the
pandemic and the Ukraine conflict, and from the high
inflation rates in the UK economy.
These uncertainties may affect our tenants’ ability to carryon
their normal business and generate cash to paytheir rent.
We have taken this into account in our sensitivity analyses.
The group’s most significant outflows are its PID and bank
interest payments, which made up 56% and 16% of the 2022
cashflow respectively.
The directors have reviewed the projected cashflows of the
group and its compliance with debt covenants. They have
also overlaid their best estimates of the impact of global
impact of the conflict in Ukraine, the legacy effects of the
Covid-19 pandemic, and the current political uncertainty
and the high inflation rates in the UK onto their forecasting
and debt covenant reviews and considered scenarios,
including:
 Rent collections reducing in the forecast period, affecting
cash generation and covenant compliance
 Void properties and those that may become void at
lease end and/or break dates remaining void for a
longer than usual period, thereby reducing income
andincreasing costs
 Property valuations reducing, adversely affecting the
related debt covenants
The directors have also stress-tested the forecasts,
considering the level of fall in income and valuations that
would cause the business to be unable to pay its liabilities
as they fall due, and have concluded that the possibility of
these scenarios occurring is remote.
The audit committee reviewed the analysis on page 100,
supporting the going concern basis of preparation of
the accounts. This review included the forecast 12-month
cashflows, headroom on debt covenants, undrawn loan
facilities and the quality and parameters of the stress
testing. Having completed their review, the committee
recommended to the board that it was appropriate to
adopt a going concern basis.
Going concern statement
The directors are not aware of any material uncertainties
that may cast significant doubt upon the group’s ability to
continue as a going concern. They have considered the audit
committee’s recommendation and concluded that there
is a reasonable expectation that the group has adequate
resources to continue in operational existence forthe
foreseeable future.
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highcroftplc.com
45

Charles Butler
Chairman
Section 172(1) statement
The board of directors confirms that it has, during the year,
acted to promote the long-term success of the company
for all of its stakeholders, including its shareholders, whilst
having due regard to the matters set out in section 172 (1)
(a) to (f) of the Companies Act 2006 being:
a. the likely consequences of any decision in the long term
b. the interests of the company’s employees
c. the need to foster the company’s business relationships
with suppliers, customers and others
d. the impact of the company’s operations on the
community and the environment
e. the desirability of the company maintaining a reputation
for high standards of business conduct
f. the need to act fairly between members of the company.
The nature of our business means that we have an ongoing
dialogue with a wide group of stakeholders, as summarised
below. During the year, the board has directly engaged
with shareholders and some of our suppliers, and regularly
monitors stakeholder engagement to ensure they are
cognisant of key stakeholders’ main concerns and interests.
The relationships built, and information obtained through
regular engagements with these stakeholders, provides
relevant input for decision making and promotes the
long-term sustainability of the company.
Stakeholder
Why is it
important
to engage? Ways we engage Key interests How do we respond?
Our
shareholders
In order to
understand
the views and
aspirations of
shareholders as
the owners of
our business
Direct and indirect
shareholder
engagement via
the annual report,
shareholder meetings
and calls with our two
main shareholder
groups. We also seek all
shareholders’ views via
our website and at the
AGM. Further details on
page 62
 Growth strategy
and healthy
returns whilst
evolving our
sustainability
strategy and
initiatives
Following the 2022 AGM,
a meeting between board
members and the significant
shareholders was held in July.
Outcomes: This in-person
discussion meant we were able
to fully understand shareholder
motivations, receive input on
strategy and direction of the
company, and strengthen our
regular dialogue with shareholders
in the following months.
Our tenants In order to have
the ability to
react swiftly
to issues and
opportunities
and to
understand how
tenant demands
are changing to
help us evolve
our strategy
We build relationships
with tenants, directly
if possible, and also via
our asset managers
 Tenant
satisfaction,
with fit-for-
purpose spaces
that are able to
evolve with their
business
 Ability to
meet future
tenants’ needs
We continued to have regular
dialogue with tenants when
lease events occurred as well as
sustained work with tenants in
particular industries following the
ongoing impact of the pandemic.
Outcomes: We achieved a
successful planning application
for our development in St Austell,
working towards providing a
BREEAM ‘very good’ building.
As part of the planning process,
we sought input from the
prospective tenants. Further
details are available on page 49.
46
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Strategic Report
Stakeholder
engagement

Stakeholder
Why is it
important
to engage? Ways we engage Key interests How do we respond?
Our
employees
We recognise
the
commitment of
our employees
to our purpose
and goals, and
help to build our
success, and we
value the input
and insight
that all team
members can
provide
As we only have
only two employees
outside the board,
our engagement is
informal
 Wellbeing
 Health and safety
 Personal
development
Please refer to page 62 for
information on our approach to
workforce engagement under the
UK Corporate Governance Code.
Outcomes: Informal reviews
were held with the employees
by a director, who is not their line
manager and reported to the
board, as appropriate.
Our advisory
team and
other
suppliers
In order to have
a close working
relationship
with all of
our suppliers,
making sure
we are all
committed to
the success of
the company
and that as a
business we
have the ability
to react swiftly
to opportunities
and issues
To ensure we
are aware of
emerging trends
and risks in the
marketplace
Building close
relationships, where
advisers have a detailed
understanding of the
business, its purpose,
culture, and objectives
and ensuring there are
regular opportunities
for dialogue during
the year
 Impact of the
wider economic
environment
 Responsible
payment terms
 No conflicts of
interest
 Mutually-
beneficial
relationships,
supporting both
parties’ interests
A director took responsibility
for each key relationship and
ensured that communication and
feedback loops were appropriate
and effective.
Outcomes: During the year,
we engaged with several new
suppliers as part of the planning
process for St Austell, and our
close collaboration with them
resulted in a successful planning
application; we will continue to
work with these suppliers this
year. The board annually reviews
the suppliers that the company
engages with to ensure these
remain appropriate.
Our local
communities
and the
environment
We wish to
ensure that our
activities have a
positive impact
on communities
and the
environment
Engagement with
local communities to
understand the impact
of our operations and
plans for development
 Making a positive
contribution to
communities and
the environment
through existing
properties
and future
developments
 Charitable
donations
(detailed on
page 51)
Quarterly meetings with asset
managers, which include
environmental matters as an
agenda item.
Outcomes: During the year
we engaged with the local
council, regarding our planning
application for St Austell. These
discussions and input helped to
shape and guide our plans for the
development.
Actively managing a range of key
stakeholder relationships, recognising that
our success and sustainability depends on
their involvement and feedback
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highcroftplc.com
47

Our culture
At Highcroft, we strive to conduct our business in an ethical
and responsible manner, making a positive contribution to
society, whilst minimising any negative impacts on people
and the environment.
Our stakeholders
Our key stakeholders are our shareholders, tenants,
employees, advisory team and other suppliers, our local
communities and the environment. Our engagement with
them and their key interests is set out in our stakeholder
engagement statement on pages 46 to 47.
The environment and
climate change
We recognise that natural resources are finite and should be
used responsibly. We seek to understand the environmental
performance of our portfolio and to implement
improvement policies where possible.
Streamlined energy and carbon
reporting regulations (SECR)
The company has, for the first year, fallen within the scope
of being required to report in accordance with these
regulations. For further details, please see page 86.
The taskforce on climate-related
financial disclosures (TCFD)
In accordance with Listing Rule 9.8.6 (8) requiring
premium-listed companies to include a statement in
the annual report confirming the extent to which they
have made disclosures consistent with TCFD on a comply
or explain basis, we have summarised our compliance to
date with the TCFD guidelines on the following pages.
The board has concluded, based on its knowledge of the
company’s actual and expected activities, its operating
environment and exposure to physical and transition
risks, that our disclosures are consistent with TCFD
recommendations with the exception of three areas. We are
working towards assessing the impact of climate-related
risks and opportunities on our business, resilience of our
strategy, as well as identifying suitable metrics and targets
and we have explained our current approach below. We will
work with our newly-appointed property asset managers
over the coming months to set appropriate metrics and
targets and prioritise the strategic and financial impacts of
our most material climate-related issues. This will inform our
strategy and ability to manage these risks and opportunities
across our business and in turn support our assessment of
the resilience of our strategy. Given the current size of our
portfolio, we intend to move towards compliance over the
next two years.
Strategic Report
48
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Strategic Report
Sustainability
Paul Leaf-Wright
Chief executive

TCFD theme
Recommended
disclosure Our approach
Governance Disclose the
organisation’s
governance around
climate-related risks
and opportunities
 The board is responsible for considering and approving our climate
strategy and objectives and, ultimately, for approving the group’s
climate-change targets and monitoring portfolio performance
 The audit committee is responsible, on behalf of the board, for ensuring
there is a robust assessment of emerging and principal risks and the
board deliberates sustainability matters as part of its regular agenda items.
Describe the
board’s oversight of
climate-related risks
and opportunities
 During the year, the board held a separate meeting with the ESG
director at Workman LLP, our property-managing agents. The aim of
the discussions was to enhance the board’s understanding of the risks
currently identified within the industry and the opportunities to address
these both in the short, medium and long term. This developed the
board’s ability to actively identify and oversee the climate-related risks and
opportunities within the business. The board received regular updates
during the year on the initiatives detailed below.
Describe
management’s role
in assessing and
managing climate-
related risks and
opportunities
 Our chief executive remains the main board member with overall
accountability for climate and sustainability. The works that took place,
during the year, to our Cardiff office asset, and our development plans
for St Austell, were overseen by Simon Gill. We continue to work with
Workman LLP and now with Cube Asset Management Ltd on prioritising
our actions to reduce the impact on the environment of the company’s
properties, and promoting the health and wellbeing of occupiers and
visitors and generating positive social value within the local community
 Our development at St Austell has had sustainability at the centre of its
plans. We note the work underway to introduce the reporting frameworks
around the Taskforce on Nature-related Financial Disclosures and
recognise the importance of preserving nature in our operations and
developments, as part of our actions to address climate risks. Nature
surveys were held on the development site as part of the planning process,
to ensure the protection of wildlife. The planning consent required a
25-year biodiversity plan and our approved plans include measures to
protect the biodiversity of the sites, with planting areas agreed as part of
the development. Our aim remains to construct a BREEAM ‘very good’
building and will include LED lighting and car charging points.
Strategy Disclose the actual and
potential impacts of
climate-related risks
and opportunities
on the organisation’s
businesses, strategy
and financial planning,
where such information
is material
 The board considers climate change as part of its decision making,
particularly around acquisitions and refurbishment projects; as noted
the focus, in particular, over the year was on Cardiff and St Austell.
As part of its approach to evaluating climate-related risks and
opportunities, management and the board, and now in conjunction with
our newly-appointed asset managers, continue to assess which of those
could have a material financial impact on the organisation.
Describe the climate-
related risks and
opportunities the
organisation has
identified over the
short, medium and
long term
 Short term (0–5 years) – market shift in terms of stricter legislation, such
as the introduction in the UK of the new minimum energy efficiency
standards (MEES) for commercial and domestic properties
 Medium term (5–15 years) – market demand from occupiers for buildings
and spaces with higher levels of efficiency and lower carbon footprints
 Long term (15+ years) – changing climate conditions in the south east of
England and Wales, principally temperature increases and flooding, and
their potential impact on our buildings.
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highcroftplc.com
49
Our actions over the year have
strengthened our progress on climate
change and we continue work to
evolve our sustainability strategy

TCFD theme
Recommended
disclosure Our approach
Strategy Describe the impact
of climate-related risks
and opportunities
on the organisation’s
businesses, strategy,
and financial planning
 As a REIT, we invest in, maintain and manage property in the south of
England and Wales and, as such, climate-related issues affect the way we
assess properties for acquisition and how we and our tenants develop and
maintain existing ones
 As part of our assessment of our existing portfolio, we consider the
geographical location, access to utilities and other relevant factors when
evaluating any climate-related risks and opportunities on properties
within our existing portfolio
 We are working with our property asset managers on measures to address
EPC ratings for particular properties within the portfolio.
 The board has agreed that ‘sustainability’ is one of the company’s
principal risks as reported on page 43. As a board we recognise that
there is some work to be done to fully identify the climate-related risks
and opportunities relevant to our business. Our aim over the next two
years is work with our asset managers to ensure these are identified
and in turn integrated into our strategy and financial planning.
Describe the resilience
of the organisation’s
strategy, taking into
consideration different
climate-related
scenarios, including a
2°C or lower scenario
 Physical climate-related risks, such as increasing temperatures, could
increase the stresses on our properties and, in turn, increase our cost
base and/or make them less attractive to existing, or potential, tenants.
We will continue to consider energy and carbon reduction, ensuring that
our buildings operate as efficiently as possible
 Our work to assess the resilience of our strategy to different climate-
related scenarios is evolving. As noted we are working towards
undertaking a thorough climate risk assessment to fully analyse our
key climate-related risks, the timing around these, and what mitigation
measures we have and can put in place, so these can be proactively
managed.
Risk
management
Disclose how the
organisation identifies,
assesses and manages
climate-related risks
 Potential climate-related risks are identified and monitored as part
of our wider risk management procedures. We are aware of the UK
Government’s commitment to a net zero economy by 2050 and continue
to consider how, as a business, we can contribute to that being achieved
and how we will operate within that economy.
Describe how processes
for identifying,
assessing, and
managing climate-
related risks are
integrated into the
organisation’s overall
risk management
 Following the decision to recognise the sustainability credentials of the
business as a principal risk, during the year, the board held a deep-dive
session to consider its current risk appetite and risk management
approach, together with a detailed look at its principal risks. It was agreed,
as part of that review, that the principal risk be refined to ‘sustainability
risks’. Our property managers continue to report on climate change as
part of their quarterly reporting and the chief executive considers whether
any issues arising from this or other matters are material enough to be
considered further.
Metrics &
targets
Disclose the metrics
and targets used to
assess and manage
relevant climate-related
risks and opportunities
where such information
is material
 The board has agreed to address the EPC ratings of our portfolio, primarily
focusing on any properties that fall below the Minimum Energy Efficiency
Standards (MEES) to be introduced from 1 April 2023. During the year, the
board reviewed the existing EPC ratings across the portfolio, and we are
working with Workman LLP on prioritising the actions to be taken in the
coming year
 As a business, due to our size and the limited amount of carbon emissions
that we are able to influence, identifying appropriate targets and
measures that will endure remains challenging. We will continue to focus
with our new asset managers, Cube Management Limited, on working
towards settling on our aims and appropriate measures.
Strategic Report
50
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Sustainability continued

The environment – energy
efficiency actions taken
during2022
During 2022, we have continued to ensure that:
 All sites are visited, at least, annually by our property
managing agents, and any environmental issues
identified are reported to the chief executive immediately,
recorded in the property managers’ quarterly
management report, and appropriate actions are taken;
 All new leases require occupiers to observe relevant
environmental regulations;
 All our property maintenance suppliers have
SafeContractor accreditation. The vetting, tendering,
appointment and management of these suppliers
follows the principles of our property manager’s
purchasing policy;
 Our property managers recognise the requirement for,
and actively encourage, sustainable working practices to
minimise environmental impacts both in respect of their own
business activities and when managing clients’ properties;
 Our property managers are committed to operating
to an environmental policy and management system
that satisfies the requirements of BS EN ISO 14001: 2004
accreditation and as part of which they measure and set
targets for improvement;
 We addressed climate change through our planning
application for St Austell. Prior to submitting our planning
application, extensive ecological surveys were undertaken
to ensure the habitat of the local flora and fauna were
protected and/or replaced. The consented property will
be built to BREEAM ‘very good’ standard specification
involving the latest technology for sustainability;
 Where opportunities have arisen to upgrade and improve
the efficiency of our buildings, we have addressed this.
At St Mary’s House, Cardiff, our improvements included
installing upgraded LED lighting systems and the provision
of cycle spaces and shower/changing facilities, with
reduced car park spaces, to encourage cycling to work;
 The weighted average of the EPCs on 18 of our 21
properties for which we have certificates, remains at a C
or above. It is currently 64, which is a C rating. The only
change in the year arose from the weighting calculation
as relative property valuations moved;
 We continue to adopt a paperless strategy with our
shareholders, and utilise our website to update our
shareholders where possible; and
 We make recommendations to the landlord of our
serviced office for energy savings that could be made.
Fairness and equality
We value the contributions made by all of our employees,
including our directors and our advisory team, and believe that
a diverse team is key to maximising business effectiveness.
We aim to select, recruit and develop the best employees
and advisers, and create an environment in which everyone
is treated with dignity and respect and in which individual
differences are valued. We achieve this by ensuring that
there are equal opportunities in recruitment and selection
processes, paying fair and competitive salaries and fees, and
being opposed to any form of discrimination for any reason. We
encourage effective communication with all our stakeholders
ensuring that everyone understands our culture and purpose.
Stakeholder alignment
We align our executive management team with our
stakeholders via the current Highcroft Incentive Plan and
the proposed Highcroft Bonus Plan, the aim of which is
to support delivery of strategy and promote long-term
sustainable success. More details on the remuneration
policy can be found on pages 74 to 78.
Diversity
We believe that a diverse team is an important factor in
maximising business effectiveness. We aim to maintain the
right blend of skills, experience and knowledge in the board
and its advisory teams. For details on the diversity of our
board and employees, please see page 55.
Communities we serve
The board considers the impact on the local communities,
including neighbouring tenants, when development and
refurbishment activity take place. A project manager is used
to oversee the work and only approved suppliers are used.
Care is taken to ensure that health and safety is taken into
account at all stages of the work.
The board also considers the potential impact on the
local community and on existing tenants when planning
permissions are applied for, and would listen to any
legitimate concerns raised.
Charity
During 2022, donations continued to be made to local and
national charities totalling £12,000. These charities support
the sick, terminally ill and disadvantaged. Examples of our
support include:
 Contributions towards the funding of palliative care in
three hospices, in a day centre, in hospitals and at home;
 Funding towards the support of those with learning
disabilities in the local community to help them to live
life to the full; and
 Contributions towards national campaigns for support
of those who suffer from abuse, neglect, autism and
heart disease.
Future focus
In 2023, we will work on evolving our sustainability strategy,
and will continue to conduct our business in an ethical and
responsible manner. Highcroft will endeavour to find the
correct balance between regulation, cost, and the absolute
impact of any changes that it is able to influence.
This strategic report on pages 16 to 51 was approved by the
board and signed on its behalf by:
Paul Leaf-Wright
Chief executive
27 March 2023
Stock code: HCFT
highcroftplc.com
51

Governance
Contents
Chairman’s introduction to
corporate governance 54
Board of directors 58
Corporate governance 60
Audit committee report 63
Nomination committee report 70
Directors’ remuneration report 72
Report of the directors 84
Statement of directors’ responsibilities 87
52
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022

Stock code: HCFT
highcroftplc.com
53

On behalf of the board, I am pleased to present the
corporate governance report for the year ended 31
December 2022. At Highcroft, our governance framework
is embedded with our culture and good governance
remains one of our key values. Our strong governance and
governance processes have enabled our efficient operations
during the year. Whilst we are a relatively small premium
listed group, our commitment to maintaining good
corporate governance remains essential to the effective
delivery of our strategy. Our ability to continue to create
value for our stakeholders and ensure the sustainability of
our business are supported by our continuing endeavours
to act in accordance with the Principles of the 2018
UK Corporate Governance Code and the board and its
committees continue to follow the appropriate guidance
and rules.
Compliance with the UK
Corporate Governance Code
The 2018 UK Corporate Governance Code (the Code) and its
Principles have continued to apply throughout the year and
supported our discussions and decision making. Throughout
the year, as the size of the portfolio and the risks associated
have remained fairly even, the board has continued to take
a proportionate approach to full compliance with all the
provisions of the code. The company, therefore, complies
with all principles and provisions of the Code, with the
exception of six provisions. The board has concluded that
there will be an ongoing consideration of compliance with
these provisions but there is no current change anticipated
to our approach, based on the explanations set out on
page 57.
We will continue to monitor with interest, developments
over the coming year on the anticipated FRC consultation
on revisions to the Code. For further detail see page 67.
Focus areas for 2022
The board’s and committee’s primary focus areas of
governance and key governance activities included:
 Appointment of a new chief executive
 Shareholder engagement at the 2022 annual general
meeting (AGM) and during the year with our significant
shareholders
 Welcoming a new non-executive director to the board
 Approving a new code of conduct and a Speak Up policy
for our employees and board members
 Supporting the proposal of a new executive remuneration
policy to shareholders at the AGM
 Continuing to address our approach and actions
tosustainability, both with existing tenants, and for
newdevelopments
This governance report, which includes our committee
reports gives more detail regarding the major decisions
taken during the year, our framework and compliance.
Stakeholder engagement
As detailed on pages 46 to 47 we remain committed to
retaining good working relationships with all stakeholder
groups and any stakeholder engagement is regularly
reported amongst the board.
We were pleased to return to a face-to-face meeting for the
annual general meeting in 2022 and currently intend to
invite shareholders to an in person meeting this year.
Future focus
The primary board focus for 2023 is continuing to work
as a team, supporting our new chief executive and asset
managers, as well as ensuring we remained engaged with
all our stakeholders.
54
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Chairman’s introduction
to corporate governance
Charles Butler
Chairman

Board diversity
Our board is composed of highly skilled professionals, all of
whom bring a wealth of skills, perspective and corporate
experience to our boardroom. The company has a culture
that recognises the benefits of all aspects of diversity,
including how this can support the development of
strategy. There remains a policy of ensuring all aspects of
diversity are considered during any recruitment process.
Given the small size of the organisation, there is no formal
board diversity policy. While we accept that diversity is
important, the board do not consider it proportionate,
at present, to recruit a new board member to meet the
target of having a member from an ethnic minority.
Ethnic representation will, however, be borne in mind
along with other factors when planning for succession.
Membership of the board
Board and staff gender representation as at
31 December 2022
Women Men
Number of board members 1 4
Percentage of board members 20% 80%
Number of senior positions on
the board
(1)
13
Number of staff
(2)
34
Percentage of staff 43% 57%
1
Senior positions refers to the role of chair, chief executive, finance director
and senior independent director.
2
As the total number of staff, including non-executive directors, for the
company is seven, the disclosures above incorporate all staff members
rather than solely the executive management.
Following the appointment of Paul Leaf-Wright from
1 January 2023, and Simon Gill then stepping down from
the end of March 2023, the gender composition of the
board will remain as reported from 1 April 2023.
At 31 December 2022, all board members and staff
are white British or other White (including minority
white groups).
For the purposes of making the disclosures set out above,
data was collected through self-reported submissions
from the board and employees.
Experience of the board
As at 31 December 2022
3
1
4
33
Finance
Mergers and acquisitions
Property
Corporate governance
Technology
Stock code: HCFT
highcroftplc.com
55
Strong governance and governance
processes have enabled our efficient
operations during the year

Compliance with the provisions of the
2018 UK Corporate Governance Code (the Code)
Our governance section evidences our compliance with Principles (A to R) of the Code and illustrates how we have applied
the Code Principles and complied with the provisions.
Section Principles Further information
1. Board leadership
and company
purpose
A. Effective board
You can read about the board’s effectiveness on
pages 61, 22 to 23 and the IFC
B. Purposes, values and culture
You can read about our purpose values and
culture on pages 61, 22 to 23 and the IFC
C. Governance framework
and board resources
Learn more about our governance framework and
board resources on pages 60 to 61
D. Stakeholder engagement
Learn more about our engagement with
stakeholders on page 54
E. Workforce polices and practices
Learn more about our workforce policies
and practices on page 62
2. Division of
responsibilities
F. Board roles
You can read about the division of responsibilities
on page 61
G. Independence
Learn more about the board independence on
pages 58 to 59
H. External commitments
and conflicts of interest
You can read about the board’s other roles
on pages 58 to 59
I. Key activities of the board in 2022
Learn more about the board’s key governance
activities on page 54
3. Composition,
succession and
evaluation
J. Appointments to the board
You can read about the work of the nomination
committee on pages 70 to 71
K. Board skills, experience
and knowledge
Learn more about our board on pages 58 to 59
L. Annual board evaluation
You can read about the board’s evaluation process
on page 62
4. Audit, risk and
internalcontrol
M. Financial reporting, external
auditor and internal audit
You can read about our audit process
on pages 63 to 68
N. Review of the 2022 annual report Learn more about the review of the annual report
on pages 64 to 66
O. Internal financial controls,
risk management
You can read more about our approach to risk
management on page 68
5. Remuneration
P. Linking remuneration
with purpose and strategy
You can read about the remuneration policy
on pages 74 to 75
Q. Remuneration policy
Read more on our remuneration policy
on pages 74 to 75
R. Performance outcomes in 2022,
strategic targets
You can read about the board’s effectiveness
on page 61
The board confirms that for the year ended 31 December 2022, the Principles of good governance contained in the 2018
UK Corporate Governance Code have been consistently applied. The company fully complied with all the provisions of the
Code, except for six of the provisions and an explanation is provided on the following page. Compliance with the Code is
considered regularly throughout the year and board members are kept updated on evolving best practice.
56
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Chairman’s introduction
to corporate governance
continued

Code
provision Detail
Potential action to
enable compliance
with the provision Highcroft decision
11
At least half the board,
excluding the chair,
should be independent
non-executive directors
Recruit at least three
more independent
non-executive directors
The board considers its composition annually as part of the board
evaluation process, the findings of which support maintaining the
board at its current size. All directors are appointed by shareholders,
and there have been no requests from the company’s significant
shareholders to increase the size of the board to satisfy these
particular requirements of the Code. The costs associated with
complying with these provisions would outweigh any potential
benefits given the small size and lack of complexity of the group.
Should the size of the portfolio of the company significantly evolve,
consideration would be given as to whether the size of the board
remains appropriate
24
Audit committee – the
chairman of the board
should not be a member
Recruit at least one
more independent
non-executive director
32
Before appointment
as chair of the
remuneration
committee, the
appointee should
have served on
a remuneration
committee for at
least 12 months
Recruit at least one
more independent
non-executive director
who has the necessary
experience to assume the
role of committee chair
Simon Costa has been chairman of the remuneration committee
since joining the board in May 2015. His appointment was made
in accordance with the 2014 UK Corporate Governance Code that
was applicable at the time. Simon has significant experience from
working in the property industry and his proficiency in chairing
the remuneration committee is recognised by the board and his
continual unanimous re-election by shareholders. The board has
concluded that compliance with this provision would outweigh
any potential benefits given the small size and lack of complexity
of the group. The selection criteria for a future non-executive
director will take this provision into consideration
36
Remuneration schemes
should promote
long-term shareholdings
by executive directors
that support alignment
with long-term
shareholder interests
Share awards should
have a total vesting and
holding period of five
years or more
Amend Incentive
Plan and/or
remuneration policy
The current remuneration policy was approved by shareholders
at the 2022 AGM and was unchanged from the policy approved
at the 2019 AGM. The remuneration committee and the board
have determined that the existing policy is overly complex for
an organisation of Highcroft’s size and have, therefore, approved
a new remuneration policy designed to continue to support
strategy and promote sustainable success. See pages 74 to 78
for further details. Under the new policy there is no shareholding
requirement for executives. The committee consulted major
shareholders on the proposed policy and no concerns were raised.
The existing policy, as reported last year, does not have vesting
and holding periods of five years or more, having been agreed by
the remuneration committee that this was a disincentive to the
executive directors
37
Remuneration schemes
and policies should
include provisions
that would enable the
company to recover
and/or withhold sums or
share awards and specify
the circumstances
in which it would be
appropriate to do so
Amend proposed
remuneration policy
to include relevant
provisions
The remuneration committee retains discretion in exceptional
circumstances to change performance metrics and targets
and the weightings attached to metrics part way through a
performance year if there is a significant material event that
causes the remuneration committee to believe the original
metrics, weightings and targets are no longer appropriate.
Discretion may also be exercised in cases where the
remuneration committee believe that the formulaic outcome is
not a fair and accurate reflection of business performance
As there is no shareholding requirement under the new policy,
there are no malus and clawback provisions required
41
There should be
engagement of
the workforce by
remuneration
committee
Formal engagement by
remuneration committee
with employees on
executive remuneration
As there are only two employees other than the board, it is not
believed that such formal engagement and disclosure thereof
would add value to shareholders. Whilst the company remains
with this smaller number of employees, informal engagement
is deemed more suitable given the close working relationship
amongst the team and board. Should the size of the portfolio of
the company significantly evolve, and in turn increase substantially
the number of employees, consideration would be given as to
whether there should be a process of formal engagement
Explanation of compliance with the Code
Stock code: HCFT
highcroftplc.com
57

Appointment to the board
Charles joined the group as
non-executive chairman in January
2018. He was considered to be
independent upon appointment and
is considered, by the board, to have
remained independent throughout
the year.
Committee membership
Chairman of the nomination
committee, and a member of the audit
and remuneration committees.
Other appointments
Charles holds the following
appointments:
Non-executive chairman of Best of
the Best plc, an AIM listed company
providing online competitions;
non-executive director of Essensys plc,
a global provider of SaaS platforms
and on-demand cloud services to
the flexible workspace industry; and
executive director of Belerion Capital
Group Limited, an FCA regulated firm
advising high net worth individuals
and family offices.
Previous experience/
brings to the board
Charles is a chartered accountant
who, prior to joining the board, was
the CEO of Market Tech Holdings PLC,
where he transformed a small group
of central London real estate assets
into a profitable, listed company with a
£1.3bn portfolio. He has deep industry
knowledge – not only in property
but also in financial services and
technology. With a successful track
record in running public companies,
M&A, raising equity and debt for
expansion, Charles continues to be
well positioned to help the company
navigate its next phase of growth.
Appointment to the board
Simon joined the group as property
director in April 2013 and assumed
the role of chief executive in August
2013. He stepped down as chief
executive from 1 January 2023 and will
remain as an executive director until
31 March 2023 when he leaves the
group.
Committee membership
Executive committee.
Other appointments
Simon runs his own property
investment and development
business and is a director of Waingate
Management Services Limited and
Solar Estates Limited.
Previous experience/
brings to the board
Simon is a chartered surveyor who
started his property career in one
of the major London practices,
subsequently becoming a partner in
Allsop & Co, before setting up his own
advisory practice in 1988. Later, he took
on the role of principal by setting up
various joint ventures and becoming
an asset manager to one of Close
Brothers’ private equity funds. Simon’s
long-term involvement and experience
in the property market in his various
positions has been of huge value to the
board since his appointment.
Appointment to the board
Simon joined the board as senior
independent director in May 2015.
Committee membership
Chairman of the remuneration and
audit committees, and member of the
nomination committee.
Other appointments
Simon is currently University Treasurer
at the Royal Agricultural University,
Cirencester, where his remit includes
financial strategy and balance sheet
management. Until recently, he was
the finance director there, where he
oversaw all the financial and related
operations of the university.
Previous experience/
brings to the board
Simon was formerly the Senior Bursar
of a college of the University of Oxford.
He was responsible for overseeing
the management of the endowment,
and the finance and estates functions,
and he served on all the college’s core
committees.
Prior to that, he was an investment
banker specialising in global M&A
activities, and then for nine years he
ran his own property company. In these
roles, he advised US and UK public and
private corporations on financial and
related matters and owned a modest
property portfolio. Simon’s breadth
of experience continues to provide
the board with a greater range of
market knowledge and skills, which are
particularly relevant to a company in
Highcroft’s position.
Charles Butler
Non-executive chairman
Simon Costa
Non-executive director and senior
independent director
Simon Gill
Executive director
58
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Board of directors

Appointment to the board
Paul joined the group as chief
executive from 1 January 2023.
Committee membership
Paul chairs the executive committee.
Other appointments
Paul is chairman of Leaf Capital as well
as a non-executive director of some
other non-listed company boards.
Previous experience/
brings to the board
Paul qualified as a Chartered
Accountant in South Africa and
has over 40 years of property and
financial services experience. He
established Leaf Capital in 2004 and
is the company’s chairman. He also
co-founded Atlantic Leaf Properties in
2013, a UK Real Estate Investment Trust
that invested, primarily, in industrial
assets in the UK. Atlantic Leaf was
listed on the JSE (South Africa) and
SEM (Mauritius) markets and Paul
was its CEO as a listed entity until
August 2019. Paul built the portfolio to
approximately £400m in assets, when
the business was sold to a large private
equity company. Under the ownership
of the private equity group, Paul
remained CEO until June 2022 when
all the assets were sold.
Paul previously held various senior
roles in South African banking
companies, including financial and
strategy director, head of treasury,
director of property and asset finance
and head of wealth management.
Appointment to the board
Roberta joined the group in April
2010 and was appointed to the board
as finance director and company
secretary in July 2010. From October
2021, she continued in her role as
finance director having relinquished
her role as company secretary.
Committee membership
Executive committee.
Other appointments
Roberta is currently a director of MCD
Ventures Limited.
Previous experience/
brings to the board
Roberta qualified as a chartered
accountant in 1988 and, after
leaving the profession in 1996, has
maintained a portfolio of part-time
executive board-level roles in a variety
of businesses at various stages of
their life cycle. Her acute attention to
detail, financial acumen and business
expertise are a valuable asset to the
board, together with her project
management capabilities. The board
benefits greatly from the experience of
her varied executive roles.
Appointment to the board
David joined the board as a
non-executive director in August 2022.
Committee membership
None.
Other appointments
David is a director of Kingerlee
Holdings Limited, Kingerlee Homes
Limited, Kingerlee Limited and
T.H.Kingerlee & Sons Limited.
Previous experience/
brings to the board
David is a director of Kingerlee
Holdings Limited, a construction
and property development group
of companies. David represents the
interests of the Kingerlee Holdings
Limited which, together with its
subsidiaries, has an aggregate
beneficial interest of 27.35% in the
share capital of the Company and
forms part of the Kingerlee Concert
Party. In this role, he does not sit on any
board committees.
Paul Leaf-Wright
Chief executive
Roberta Miles
Finance director
David Warlow
Non-independent
non-executive director
Key
Chairman
Executive
committee
Nomination
committee
Audit
committee
Remuneration
committee
Member
Stock code: HCFT
highcroftplc.com
59

Governance framework
The board
The board is appointed by shareholders and is collectively responsible to provide effective leadership to
the company. It is responsible to shareholders for the strategy, control and leadership of the group
and long-term sustainable success ofthe company taking into account the interests of all stakeholders.
The board delegates authority to managethebusiness to the chief executive and delegates other
matters to board committees and management asappropriate. The matters reserved for the board and
the terms of reference of the board committees are available onthe group’s website www.highcroftplc.com.
Chairman: Charles Butler
Composition: Two executive and three non-executive directors
Board committees
Executive
committee
Audit
committee
Remuneration
committee
Nomination
committee
Chair: Simon Gill
1
Chair: Simon Costa Chair: Simon Costa Chair: Charles Butler
This committee is
comprised of the
executive directors and
the company secretary
and is chaired by the
chief executive.
Roles: Implementation
of strategy and
policies, day
-t
o-day
decision making and
administration of
the group.
1
As at 31 December
2022. Paul Leaf-Wright
took on this role from 1
January 2023.
This committee
is comprised of
the independent
non-executive directors.
Audit committee
meetings are attended,
by invitation, by the
auditor and the finance
director, and other
executives may be invited
to attend from time
to time.
Roles: Financial
reporting, monitor
risk management and
internal control, monitor
external audit process.
This committee
is comprised of
the independent
non-executive directors.
Roles: Remuneration
policy, setting of directors’
remuneration packages,
agreeing incentive plan
targets and outcomes.
This committee
is comprised of
the independent
non-executive directors.
Roles: Recommends
board appointments,
succession planning,
reviewing board
composition, skills
and diversity and
performance evaluation.
Corporate governance is essential to ensuring our business is run in the right way for the benefit of all of our stakeholders.
Our governance framework was established to provide clear lines of accountability and responsibility. It also assists with the
sharing of information and facilitates fast decision making and effective oversight. Our governance arrangements continue
to support the development and delivery of strategy by ensuring accountability and responsibility, facilitating the sharing of
information to inform decisions, enabling engagement with key stakeholders, maintaining a sound system of risk oversight,
management and internal controls, providing independent insight and knowledge from the independent non-executive
directors and facilitating the development and monitoring of key performance indicators.
60
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Corporate governance

Board effectiveness
The board meets at least five times per year focusing
on strategic issues, as well as operational and financial
performance, risk management and other critical business
concerns. There is a formal schedule of matters reserved
for its decision. It also approves the terms of reference of
all sub-committees and conducts an annual evaluation of
the board.
Each of the directors has committed to attend all scheduled
and relevant committee meetings. If a director cannot,
for unseen circumstances, attend a meeting, they will be
provided with the papers in advance of the meeting as usual
and can discuss them with the chairman or chief executive
and provide comments. Attendance at the committee
meetings is shown in the respective committee reports.
Attendance at board meetings is shown below:
Attendance
Charles Butler 7/7
Simon Costa 7/7
Simon Gill 7/7
David Kingerlee (resigned from 1 August 2022)
1
3/4
Roberta Miles 7/7
David Warlow (appointed from 1 August 2022)
2
3/3
2
David Kingerlee resigned from the Board on 1 August 2022 and was,
therefore, eligible to attend four board meetings during the year.
3
David Warlow was appointed from 1 August 2022 and was, therefore, eligible
to attend three board meetings during the year.
The chairman of the board, and the chairs of the
committees, set the agendas for upcoming meetings with
support from the company secretary. The board receives
appropriate and timely information, and the directors
are free to seek any further information they consider
necessary. The directors utilise an electronic board portal,
which provides immediate and secure access to current
andpastpapers.
On appointment, an induction programme tailored to their
individual needs is available to all directors. Each induction
programme would ordinarily include information on the
corporate strategy, the financial position and tax matters, an
overview of the property portfolio provided by members of
the team, visits to key assets, details of board and committee
procedures and directors’ responsibilities, covering both
legal and regulatory requirements, information on the
approach to sustainability and of recent stakeholder
engagement.
Throughout a director’s tenure, they are encouraged to
develop their skills and knowledge, which is also considered
as part of the board evaluation. Directors are also provided
with, and updated as appropriate on, matters such as share
dealing restrictions and corporate governance matters. All
directors have access to advice from the company secretary
and independent professionals at the company’s expense.
Division of responsibilities
Chairman
 Leads the board ensuring it operates effectively and in
accordance with good governance.
 Sets board agenda for meetings and ensures that
adequate, accurate and clear board information is
circulated in a timely manner; that all matters are
discussed properly; and promotes a culture that
encourages constructive open debate on all keyissues.
 Maintains a dialogue with shareholders.
Chief executive
 There is a clear division of responsibilities between the
chairman and the chief executive.
 Oversees the day-to-day running of the group’s business
including the development and implementation of the
board’s agreed strategy.
 Leads the executive team.
Company secretary
 Provides advice and assistance to the board, chairman
and other directors.
 Supports the chairman with the development of agenda
for board meetings and provision of information to
the board.
 Advises the board on corporate governance
developments.
Non-executive director
 Brings an external perspective, constructive challenge
and objectivity to the board’s deliberations and decision
making.
 Drawing on their extensive experience and knowledge,
they act as both a sounding board and as objective,
constructive scrutinisers and challengers to the executive
board.
 Help facilitate the strategic decision making process
and the monitoring of the performance of the executive
management in achieving the agreed strategy and
objectives.
Senior independent director
 Provides a sounding board for the chairman and serves as
an intermediary for other directors when necessary.
 Available to discuss concerns with shareholders
that cannot be resolved by the normal channels of
communication with the chairman or chief executive.
Stock code: HCFT
highcroftplc.com
61

Workforce policies andpractice
As there are only five directors and two employees, there
are a limited number of formal policies. During the year, the
board approved a new Code of Conduct and a Speak Up
policy, ensuring that employees and our other stakeholders
are clear on our principles and compliance and reflecting
the directors’ commitment to make improvements to our
governance framework. Everyone is aware of the group’s
purpose and understands its values. We require all directors
to notify the company if there is a situation that could give
rise to a conflict or potential conflict of interest, and we
ensure that our independent non-executive directors remain
independent of executive management and free from any
business relationship that might materially interfere with
exercise of their judgement. As noted on page 57 as we only
have two employees, the mechanisms used by the board to
engage with employees is informal.
Board evaluation
Formal procedures appropriate to the size of the business
are in use for performance evaluation of the board and its
committees. They include objective setting and review with
the use of an external facilitator on a periodic basis. During
the year, the board conducted a self-performance evaluation
by way of a questionnaire, which was facilitated by the
company secretary. The questionnaire was designed to
evaluate the effectiveness of the board and its committees,
as well as identify areas for improvement. The results were
discussed by the board and action points created to ensure
that any areas needing improvement were prioritised
and addressed. Progress against the conclusions of the
2021 review were analysed, noting the matters addressed
over the year. The board considered itself to be generally
effective in all areas identified in the questionnaire. Areas
for improvement were identified, including advancing
the formulation of strategy, progressing ESG matters and
continuing to strengthen stakeholder engagement.
Relations with shareholders
The board values the views of its shareholders and
recognises their interest in the company’s strategy
and performance, board membership and quality of
management. The chairman and other directors are
available to meet shareholders if required. The AGM
providesa forum, both formal and informal, for shareholders
to meet and discuss relevant matters with all the directors.
Documents are sent to shareholders at least 21 clear days
before the meeting. Separate resolutions are proposed on
each substantial issue so that they can be given proper
consideration, and there is a resolution to receive and
consider the annual report and financial statements, and
the directors’ remuneration report. The company counts all
proxy votes and will indicate the level of proxies lodged on
each resolution. Full details of the AGM voting are included
on the company’s website after the meeting. The company
has no institutional shareholders but has continued a
programme of meetings with key shareholders, subject
to regulatory constraints, and the board is provided with
feedback from these meetings.
The Kingerlee Concert Party falls within the definition of a
controlling shareholder as it owns in excess of 30% of the
share capital of the company, and there is a Controlling
Shareholder Agreement in place as required by the
ListingRules.
The directors have put in place measures to ensure that
the election or re-election by the shareholders of any
independent non-executive director should be approved by
an ordinary resolution of the shareholders and separately
approved by those shareholders who are not controlling
shareholders, namely the independent shareholders.
At the AGM in May 2022, the proportion of votes cast against
the resolution to re-elect David Kingerlee, as a director of
the company, exceeded 20%. The UK Corporate Governance
Code requires companies to provide an update within six
months of an AGM and a summary in the annual report.
Asreported in September 2022, to better understand
shareholder concerns with a view to identifying how such
matters can be addressed, the board engaged with its
significant shareholders to gain an understanding of their
concerns. Since the AGM, David Kingerlee has stepped
down as a non-executive director of the company and
David Warlow was appointed from 1 August 2022. David
Warlow represents the interests of Kingerlee Holdings
Limited which, together with its subsidiaries, forms part of
the Kingerlee Concert Party. The board continues to engage
with significant shareholders on a regular basis.
Shareholders who wish to communicate with the board
should contact the company secretary in the first instance
via our website: www.highcroftplc.com.
Directors’ powers at the year end
At the 2019 AGM, the directors were given powers, as follows:
 To allot new shares, or to grant rights to, subscribe for, or
convert, any security into shares of the company for the
purpose of the satisfaction of awards granted under the
Highcroft Incentive Plan up to an aggregate nominal
amount of £64,591; and
 To allot equity securities for cash on a non-pre-emptive
basis, up to an aggregate nominal amount of £64,591.
See pages 74 to 75 for information on the proposed
remuneration policy.
During 2022, new ordinary shares with a nominal amount of
£2,816 were allotted under these authorities in satisfaction of
the 2021 awards under the Highcroft Incentive Plan, leaving
£57,660 of authorities remaining.
62
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Corporate governance continued

I am pleased to introduce the audit
committee report for the year ended
31 December 2022. We set out below a
summary of our main responsibilities
and key activities during the year. As
a committee, we are responsible for
monitoring the integrity of the group’s
reporting, and in continuing to develop
and maintain a sound system of risk
management and internal control.
Main responsibilities
In line with the authority delegated by the board, the audit
committee has the following main responsibilities:
 Risk management and internal controls
reviewing the system of internal controls and risk
management
 Financial reporting
monitoring the quality and integrity of the company’s
financial statements and any formal announcements
relating to financial performance, and considering
significant financial reporting issues, judgements
and estimates
 Property valuations
considering the process and outcome and the
effectiveness and independence of the external valuer
 External audit
oversight and remuneration of the external auditor,
and review of the policy for non-audit services provided
by the external auditor.
Composition of the committee and
attendance at meetings
There have been no changes to the membership of the
committee during the year. The committee continues to
be composed solely of the independent chair of the board
and the independent non-executive director. The board is
satisfied that they both have sufficient financial experience,
commercial acumen and real estate sector knowledge
and experience to carry out their duties effectively. Further
information about members’ qualifications can be found
in the directors’ biographies on pages 58 to 59. Their
attendance at committee meetings is set out below:
Director
Committee
position
Date of
committee
appointment Attendance
Simon Costa Chairman May 2018 5/5
Charles Butler Member January 2018 5/5
The committee meets regularly during the year, in line with
the financial reporting timetable and, in 2022, met five
times for routine business. Roberta Miles, as finance director,
attends part of each meeting and the external auditor
attends all meetings. The committee has an agenda item
at each meeting to discuss business without any executive
directors being present.
In addition to the five main meetings, there were also several
informal meetings, and general discussions between the
committee members and, at times, the finance director and/
or the auditor regarding ongoing committee considerations.
The terms of reference were reviewed during the year and
are available on the group’s website at: www.highcroftplc.
com. This review included enhanced descriptions of the
references to the responsibilities connected with risk
management, going concern and viability statement
processes and ESG responsibilities in line with best practice.
2022 key achievements
 Update of the terms of reference to include enhanced
descriptions of the references to the responsibilities
connected with risk management, going concern and
viability statement processes and ESG responsibilities
 Rotation of audit partner in line with regulation
 Production of ESEF tagged 2021 accounts
Focus areas for 2023
 Consideration of climate change matters, including
ESG, internally and in our financial statements
 Adoption of a valuer appointment policy setting out our
position on valuer appointment and tenure
 Benchmark review of external audit fees
 Consideration of the government’s proposed changes
to audit and financial reporting governance following
the BEIS consultation
Stock code: HCFT
highcroftplc.com
63
Audit committee report
Audit, risk, and internal control.
Monitoring quality and integrity.
Simon Costa
Chairman

2022 calendar
The calendar below gives an overview of the key matters considered by the committee during the year.
Jan 2022 March 2022 May 2022 Sept 2022 Dec 2022
 Valuation reports,
effectiveness and
independence
of valuer
 2021 draft annual
report and accounts
and preliminary
announcement
 Review of financial
reporting
 Fair, balanced and
understandable
assessment
 Going concern and
viability assessments
 Review of subsidiary
reporting
 External audit
report and auditor
reappointment
 Review of committee
terms of reference
 Review of requirement
for internal audit
function
 AGM – authority for the
directors to determine
auditor’s remuneration
and reappointment
of auditors approved
by shareholders
unanimously
 External interim review
plan and fees
 Valuer report
 2022 interim results
and half-year
announcement
 Risk management
update
 External interim
review report
 Assessment of
principal and
emerging risks and risk
appetite
 Review of compliance
with the Code
 External audit plan
and fees
 Independence of
external auditor
 Internal controls
effectiveness
 Whistleblowing policy
 Fraud and
anti-bribery update
Principal responsibilities of the committee and its related activities
Financial reporting
The committee is responsible for monitoring the integrity of the group’s financial statements and any formal announcements
relating to performance. It paid particular attention to those matters that were considered to be important to the group due
to their subjectivity, the level of judgement involved or their effect on the financial statements.
In 2022, the key issues relating to our financial statements that were considered are set out below:
Significant
issues
considered Potential risk How those issues were addressed Conclusion
Valuation
of property
portfolio
The valuation of our
investment property
portfolio is inherently
subjective as it is
undertaken on the
basis of assumptions
made by valuers,
which may not
prove to be accurate.
The outcome of
the valuation is
significant in terms
of our results, future
investment decisions
and remuneration
The external valuers carry out a valuation every year at
30June and 31 December. They also provide an overview
of the UK property market and the detailed performance
of the group’s assets. The valuer attended a meeting
with the board and the auditor after the year end, where
the agenda included the process adopted by the valuer,
data provision by management, comparable market
data and assumptions used by the valuer including
estimated rental values and yields. It also reviewed a
commentary on the relevant qualifications of the valuer
and on their independence. It noted that the fee for
the recurring valuation work was £18,000 and for other
advisory work, including valuation fees for lenders, was
£5,000 (2021£18,000 and £16,000). The audit committee
analysed the reports, reviewed the summary of the work
of the executives in reviewing the valuer’s work, reviewed
the valuation outcomes and challenged assumptions
where it believed appropriate. It also noted that the fee
arrangement with the valuer was on a fixed fee basis in
line with best practice. It also noted the results of the work
carried out by alternate valuers for bank valuation reports
on three properties during 2022 and the comparison of
the outcomes to those of the bi-annual valuations
The committee was
satisfied with the
valuation process, the
independence and
effectiveness of the
group’s external valuer
and the valuation
disclosures included
in the annual report.
The committee
recommended to the
board that it considers
the rotation of the
valuer in 2023 in line
with best practice
64
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Audit committee report continued

Significant
issues
considered Potential risk How those issues were addressed Conclusion
Revenue
recognition
Revenue may be
recorded in the
incorrect accounting
period, or fail to be
recorded at all, or
fictitious revenues
may be recorded
The committee considered the appropriateness of the
controls in place in the revenue cycle, having particular
regard to the use of external agents and the controls
in place over their work including the reconciliations
performed and reviewed internally
The committee
concluded that the
revenue recognition
policies and controls
were appropriate
REIT status The group loses its
REIT status
The committee considered the controls in place to
ensure compliance with REIT tests. In particular,
they reviewed the compliance with the distribution
requirement and the impact of forecasted results and
trends on this criterion. They also reviewed the non
close company status requirement in the context of
theprofessional advice that had been taken on this
during 2021
The committee
concluded that the
group’s REIT status
had been maintained
during the year
Going
concern
statement
If this basis was
inappropriate
then there could
be material
misstatements in the
financial statements
The committee reviewed the analysis supporting the
preparation of the financial statements on a going
concern basis, particularly in light of the legacy of the
Covid-19 pandemic, the ongoing war in Ukraine and the
current high-inflationary pressures in the UK. This review
included forecast cashflows, loan maturities, headroom
on our debt covenants and undrawn debt facilities
The committee
concluded that
the going concern
method of
preparation remained
appropriate. The
going concern
statement is set out
on page 45
Viability
statement
If the statement
was incorrect then
corrective action
might need to
be undertaken to
ensure the group’s
viability
The committee reviewed management’s assessment
of whether the group’s long-term viability appropriately
reflects the prospects of the group and covers an
appropriate period of time. This included consideration
of whether the assessment adequately reflected the
groups risk appetite and principal risks as disclosed
on pages 38 to 43; whether the period of five years
covered by the statement was reasonable given the
strategy of the group and the environment in which it
operates; and whether the assumptions and sensitivities
identified, and stress tested, represented severe but
plausible scenarios in the context of solvency and
liquidity. The committee reviewed the report by the
auditor on their work carried out on the management’s
assessment
The committee
concluded that
the statement had
been drawn up on
a reasonable basis
and agreed with
its assessment. The
viability statement,
together with
further details on
the assessment
undertaken, is
onpage 44
Provisioning Incorrect
provisioning would
affect the results
of the current and
future periods
The committee considered the management approach
in determining appropriate provisioning levels for rental
arrears and tenant incentives including those that
remain related to the Covid-19 pandemic
The committee
was satisfied that
the provisioning
approach was
appropriate and
proportionate for
thegroup
In addition, the committee consider the additional risks that may arise related to Highcroft’s status as an associated
undertaking of Kingerlee Holdings Limited, which commenced on 10 December 2020. In 2022, the committee continued to
recommend to the board that, as a result of this status, Mazars should carry out a full interim review at the half year.
Stock code: HCFT
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65

Financial reporting and fair, balanced
and understandable reporting
The committee continues to review the content and tone
of the preliminary results, annual report and interim results
prior to their publication, the application of the group’s
accounting policies and the detail of any changes to the
financial reporting requirements. Drafts of the annual
report are reviewed by the committee prior to the formal
consideration by the board with sufficient time provided
forfeedback.
The committee reviewed the key messaging included in the
annual report and interim results, paying particular attention
to those matters considered to be important to the group by
virtue of their size, complexity, level of judgement required or
potential impact on their financial statements.
The committee also considered the annual report and
accounts, as a whole, on behalf of the board and made
a recommendation to the board that it resolve that they
were fair, balanced and understandable and provided
the information necessary for stakeholders to assess the
group’sposition, performance, business model and strategy.
The committee ensured that the board continued to present
a balanced and understandable assessment of the group’s
position and prospects in all interim and other
price-sensitive public reports to regulators.
The responsibilities of the directors with regard to the
financial statements are described on page 87, and that of
the auditor on page 66.
In accordance with DTR4.1.14R, Highcroft is required to
publish its annual report in eXtensible HyperText Markup
Language (XHTML) and key elements of its financial
statements need to be tagged using eXtensible Business
Reporting Language (XBRL) in accordance with a published
single electronic reporting taxonomy. The 2021 annual
report was formatted and tagged in accordance with
these requirements and the 2022 report will be tagged
in greater detail as required by legislation. It was noted
that this tagging did not require external audit approval.
The committee noted that in order to prepare for these
requirements, management had:
 appointed an external specialist (Parseport for 2021 and
BDO for 2022) to assist with tagging
 conducted trial runs in 2021 to ensure that the initial
process worked
 established a process for checking all tags (internal in
2021 and external for the more complex 2022 tagging
requirement)
 established a process to ensure that both PDF and
XHTML formats of the 2022 annual report will be available
at the same time for publishing on the group website and
filing at the National Storage Mechanism
External auditor
Auditor independence
The audit committee reviews the terms of engagement with
the external auditor annually and ensures that the external
auditor is independent. It has received and reviewed written
disclosures from the auditor regarding independence. It is
a group policy that non-audit work will not be awarded to
the external auditor if there is a risk that their independence
may be jeopardised. The committee monitors the level of
fees incurred for non-audit services to ensure that this is not
material. The committee must approve in advance all
non-audit assignments carried out by the external auditor.
The fees payable to the external auditor are as follows:
2022
£’000
2021
£’000
Audit fees 58 54
Interim review 10 10
68 64
Auditor tenure
Mazars LLP were appointed as auditors to the group in 2017,
following a formal competitive tender, The group’s audit
partner is Nargis Yunis who rotated onto this role in March
2022, to replace Stephen Eames, in line with regulation.
Auditor effectiveness
In order to ensure that the external audit is as effective as
possible, the auditors must identify the appropriate risks as
part of their planning process. For this financial year, Mazars
LLP submitted a detailed audit plan at the audit planning
meeting of the committee, which outlined key risks (including
the valuation of investment property, risk of revenue
misstatement due to the inclusion of fraudulent transactions
and areas of accounting capable of manipulation). The
directors are satisfied that the risks identified by the auditors
are consistent with those identifiedinternally. The committee
assesses the performance of the external auditor through
informal dialogue with the executive directors taking account
of the planning, delivery and execution of the audit, the
technical competence and strategic knowledge of the audit
team and the effectiveness of reporting and communication
between the audit team and management.
At each audit committee meeting, the committee reserves
time for a meeting without executive management being
present. We discuss matters including the quality of the
information provided to the auditor by the executives,
confirmation that the auditor has not been restricted in their
audit process, nor unduly influenced by management, and
a discussion of any areas where they have had to use their
professional scepticism.
66
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Audit committee report continued

Committee evaluation
The audit committee reviews the appointment of the
external auditor on an annual basis and reviews their
objectivity, effectiveness, independence and remuneration.
As part of this review, Mazars provide the committee
with an annual report on its integrity, objectivity and
independence and on the policies and procedures that
they have in place to ensure this. The board also reviewed
the auditor’s effectiveness and considered: the qualification
and expertise of the engagement partner and the audit
team, the availability of resources to complete a timely and
comprehensive audit, the quality of the audit in respect
of key judgements and estimates and audit deliverables.
The committee concluded that, on the basis of this review,
the auditor was objective, effective and independent and
recommended to the board that a resolution proposing
Mazars’ reappointment be put to shareholders at the
2023 AGM.
FRC review
During 2021, the audit of the 2020 annual report and
accounts by Mazars was subject to routine review by the
Audit Quality Review (AQR) team of the FRC. The results
were communicated to Mazars and the company in
2022. The AQR team reviews the process of the audit by
examining the audit papers and discusses issues with the
audit partner and with me as chair of the audit committee.
At the end of the review the AQR writes to both, giving their
comments. The committee is satisfied with the outcome,
which underpins our view of the overall quality of the Mazars
audit. The AQR process is useful in strengthening our overall
process and is commended by the committee.
Restoring trust in audit and corporate governance
The committee welcomes all developments that aim to improve transparency in governance and trust in corporate
disclosures. The committee notes the government’s consultation (BEIS consultation), published in March 2021 and reported
in May 2022. The report notes intended changes that aim to progress director accountability in relation to dividends and
capital maintenance, to corporate reporting and directors’ remuneration. The committee will monitor the outcome of the
consultation to ensure that there is a process for incorporating any required changes into the group’s practices or reporting.
There is no clear time frame for implementation of the reforms or the setting up of the new regulator the Audit, Reporting
and Governance Authority (ARGA). The committee will consider early adoption of the proposals during 2023. The key
proposed reforms insofar as they may relate to the group include:
Proposed reforms Highcroft’s initial response
A strengthening, by the regulator, of the Code in the area of
internal controls
We will continue to review our internal control framework
annually identifying how it may be further strengthened
Additional disclosures around distributable reserves, dividend
policy, dividend paying capacity and the legality of dividends
We have enhanced our disclosures in respect to distributable
reserves and our dividend policy
A new reporting requirement of a resilience statement
(to replace the viability statement) that covers the short,
medium and long term of the business; this statement will
need to be reverse stress-tested
During 2023 we will plan to enhance our disclosures
regarding the short, medium and long-term threats to the
group’s resilience
A requirement to publish an audit and assurance policy
setting out the group’s approach to assuring the quality
of the information presented to shareholders beyond that
reported in the financial statements
During 2023 we will review the detailed requirements and
start to develop an audit and assurance policy
The committee will consider, during 2023, whether its terms of reference need to be enhanced to include responsibilities
arising from these reforms.
Stock code: HCFT
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67

Risk management and internal controls
The board is responsible for an ongoing process to identify, evaluate and manage the risks facing the business, establishing and
maintaining a sound system of internal control and for reviewing its effectiveness. The committee considered the group’s risk
appetite and concluded that it remains set at an appropriate level and is in line with the group’s strategy. The audit committee is
responsible for overseeing the adequacy and effectiveness of the risk management and internal control systems. The system of
internal control is designed to meet the needs of the group and the risks to which it is exposed, and by its very nature provides
reasonable, but not absolute, assurance against material misstatement or loss. Highcroft, whilst a premium main market listed
group, is very small when considering the number of people working directly in the business. Our group structure is simple and
transparent and our internal control procedures and policies are well established, reviewed annually internally, and subject to
review during the external audit. The internal financial control system was in place for the period under review up to the date of
approving the accounts and is summarised in the table below.
Overview of internal financial controls
Financial reviews and
internal procedures
There is a quarterly system of financial reporting and forecasting for the board, which
includes variance and sensitivity analyses. Our five-year forecasts are updated prior to each
main board meeting and a more thorough exercise is carried out annually.
Suitably qualified staff prepare documents, in good time, to allow adequate internal review
and audit processes to take place
Governance framework Our governance framework (page 60) supports effective financial control through an
approved schedule of matters reserved for decision by the board including property
transactions, significant capital expenditure, and dividends. There are clear limits of authority
for approvals for all purchases and payments
Internal controls reviews There is an annual review of internal controls by the committee and the board
Tax procedures Corporation tax return input data and draft calculations are prepared internally. The
preparation of capital allowance reports and corporation tax returns are prepared by external
advisers and reviewed by the finance director. Payroll is prepared by an external specialist
and checked internally and any variances to expectation investigated. The group has an
open relationship with HMRC and had an update meeting in January 2023, at which no
compliance or other issues arose
Staff awareness Both staff members are aware of the delegated limits set by the board. The committee and
board have approved a whistleblowing policy for reporting of concerns
External verification During the year, no significant issues were identified by Mazars as a result of the control
testing carried out as part of their audit
There is an ongoing process to identify, evaluate and
manage the risks facing the business. The systems of internal
control and board protocols were reviewed during the year
and the conclusion was that the systems are adequate for a
group of this size and complexity. Risk is on the agenda for
all committee and board meetings. This review has been
undertaken in accordance with guidance published by The
Institute of Chartered Accountants in England and Wales.
More detail regarding our management of risk within our
strategic framework is set out on pages 38 to 43.
The committee has considered the internal control and risk
management systems in relation to the financial reporting
process and concluded that they are adequate.
Internal audit
The committee has considered the need for an internal
audit function but has decided that the size and complexity
of the group does not justify it at present. The work of
the external auditor provides an element of comfort that
controls are operating as intended and the executive
team reviews the operation of the group’s policies and
procedures. The committee is mindful of the need to ensure
that a sufficiently robust evaluation of the group’s risk
management and internal control systems is undertaken.
In the absence of an internal audit function, it will keep the
arrangements for achieving internal assurance under review,
at least annually.
The audit committee reports on each of its meetings at the
subsequent board meeting.
Simon Costa
Chair of the audit committee
27 March 2023
68
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Audit committee report continued

Stock code: HCFT
highcroftplc.com
6969

Welcome to the report of the nomination committee.
We set out below a summary of the main responsibilities
and key activities during the year.
Main responsibilities
In line with the authority delegated by the board,
the nomination committee has the following main
responsibilities:
 Board appointments and succession
– leads the process for board appointments, ensures
plans are in place for orderly succession to the board.
 Board composition
– reviews the structure, size and composition of the board
and its committees, recommending to the board any new
appointees and the reappointment of existing directors
and committee members.
 Board diversity
– ensures there is a balance of skills, knowledge,
experience, and diversity on the board.
 Board evaluation
– oversees a formal and rigorous annual evaluation
of the board, its committees and directors.
Composition of the committee and
attendance at meetings
There have been no changes to the membership of the
committee during the year. The committee continues to
be composed solely of the independent chairman of the
board and the independent non-executive director, their
attendance at committee meetings is set out below:
Director
Committee
position
Date of
committee
appointment Attendance
Simon Costa Chairman May 2018 5/5
Charles Butler Member January 2018 5/5
If this committee is dealing with the successor to the
chairmanship it would be chaired by another non-executive
director and may involve an external consultant.
Activities of the committee
Appointment of chief executive
The process to find our new chief executive was led by the
committee. The committee initially assessed the existing
role to fully consider whether it should continue in its
current form, or whether it would be more beneficial for the
company if the role was structured in an alternative way.
As part of investigating the options, initial discussions were
held with an external search consultancy. The outcome of
these conversations was that given the size of the company,
the process for sourcing, identifying and securing the right
candidate, and the cost and timing required to identify a
new chief executive to undertake the existing role, did not
make this a viable option.
The committee concluded, together with the board, that
separating part of the asset management elements of
the role from the existing chief executive role, would be
advantageous. A revised role profile was collated and it was
concluded that in terms of cover for the responsibilities,
this new arrangement would represent an improvement.
The committee agreed that should the new chief executive
have an existing association with a property advisory firm
this could be advantageous but not essential. This being the
preferred option, the committee worked with the executive
team to identify suitable candidates to approach.
Discussions were held with property advisory firms
alongside the search for a new chief executive. Candidates
for the chief executive role were considered on the basis of
their skills and experience. The rigorous recruitment process
involved an interview process by a selection panel made up
of the chairman, senior independent director, current chief
executive and finance director, from which the shortlisted
candidate met with each member of the board. The views
of the directors were provided to the committee and a
recommendation was made to the board by the committee.
2022 key achievements
 review of the role of chief executive and how this
could be realigned to support the business
 appointment of the new chief executive
 facilitated smooth appointment process for
David Warlow
 induction of new directors
Focus areas for 2023
 consideration of executive and non-executive
succession planning
 review of training and development needs for
the board
 review of skills of the board and how this supports
delivery of strategy
70
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Charles Butler
Chairman
Nomination committee
report
Appointment, evaluation and succession.

In accordance with our policy of all board appointments
being made with the aim of achieving a correct balance
and blend of skills, experience, knowledge, backgrounds,
diversity, in all its forms, the recruitment process aimed to
ensure that it would attract a diverse range of candidates
and that new members of the board are able to work
effectively with all of our stakeholders.
We were delighted to welcome Paul Leaf-Wright to the
board from 1 January 2023. For further details see page 04.
New non-executive director
During the year, the board welcomed David Warlow to
the board, following the resignation of David Kingerlee. As
reported, David Warlow continues to represent the interests
of the Kingerlee Holdings Limited and, therefore, no external
recruitment process was required.
Succession planning and
board composition
The committee continued to ensure that it regularly
reviewed succession plans for the company. These
discussions helped to inform the decisions approved by
the board on appointing a property advisory firm, as part
of modifying the role of chief executive.
In accordance with the Code, all directors offer themselves
for reappointment on an annual basis at the AGM. The board
carried out an effectiveness evaluation during the year
and the committee concluded that each of the directors
continues to make an effective and valuable contribution,
demonstrates commitment to their role and that it is in the
best interest of the shareholders that each director be
re-elected. The competencies and experience required in the
boardroom were considered as part of the board evaluation
and the committee continues to monitor the need to secure
any particular skills. The board considers that the length
of time that each director serves on the board should not
necessarily be limited and has not set a finite tenure policy.
Diversity
The committee recognises the importance and benefits of
all aspect of diversity not limited to gender, ethnic group,
background, age or cognitive and personal strengths within the
boardroom and amongst its employees. Our ‘Board Diversity’
section on page 55, gives further details on our approach.
Charles Butler
Chair of the nomination committee
27 March 2023
Stock code: HCFT
highcroftplc.com
71
The committee fulfilled an important
role in leading on the process to
appoint a new chief executive,
ensuring the current and future
needs of the business were addressed.

Main responsibilities
In line with the authority delegated by the board,
the remuneration committee has the following
main responsibilities:
 Role
to assist the board to fulfil its responsibility to
shareholders to ensure that executive remuneration is
designed to support strategy and promote sustainable
success and is aligned to company purpose and linked
to the delivery of the company’s long-term strategy.
 Remuneration policy
to determine and agree with the board the policy for the
remuneration of the executive directors and ensuring
that they are appropriately incentivised to enhance
the group’s performance and are rewarded for their
contribution to the success of the business by designing,
monitoring, and assessing incentive arrangements, and
assessing performance and outcomes against them.
 Dialogue with shareholders
to maintain an active dialogue with shareholders,
ensuring theirviews are sought and considered
when setting remuneration policy.
Annual statement
I am pleased to introduce the remuneration report for the year
ended 31 December 2022. This report comprises three sections:
 This annual statement;
 The summary of the proposed revised directors’
remuneration policy; and
 The annual report on remuneration for the year.
This report describes the fourth year of the application of the
remuneration policy incorporating the Highcroft Incentive
Plan and explains the committee’s intentions for 2023.
Composition of the committee
and attendance at meetings’
There have been no changes to the membership of the
committee during the year. The committee continues to be
comprised solely of the independent chairman of the board
and the independent non-executive director, and meets at
least three times per year, together with ad-hoc meetings
when required. The attendance at committee meetings
during the year is set out below:
Director
Committee
position Attendance
Simon Costa Chairman 3/3
Charles Butler Member 3/3
The board considered our independence during the year
and concluded that both members were independent.
Neither of the committee members had any potential
conflicts of interest arising from cross directorships, nor
anyday-to-day involvement in running the business.
Major decisions made during
the year
During the year, the remuneration committee met to:
 Review the current policy in the context of the ongoing
appropriateness for the company, given the resignation
of the chief executive and the recruitment of his
replacement and evolving practice, and determining
the proposal to the 2023 AGM for a revised remuneration
policy;
 Consider whether the Highcroft Incentive Plan was an
appropriate incentive for the two executive directors in
the future and whether there was a more appropriate
solution that continues to add rigour and transparency
tothe determination of awards, while also rewarding both
the delivery of returns to shareholders and sustained
long-term performance and, in so far as is practicable,
isin line with the requirements of the Code;
 Agree the incentive plan criteria and awards for executive
directors for 2022;
 Begin to review the level of directors’ salaries and the
split between fixed and variable elements for 2023.
Thedirectors’ salaries were informally benchmarked
against the external market and advice taken from
recruitment consultants during the CEO search process.
Changes for all directors were proposed and confirmed
after the year end; and
 Consider the process regarding the decision on Simon
Gill’s status as a good leaver.
Advisers
The committee appointed PwC in 2023 to advise them on
market practice related to incentive plans and the proposed
change in remuneration policy.
Remuneration philosophy
The board’s stated objective is to enhance shareholder value
through a combination of increasing asset value, profits and
dividends. In order to achieve this objective, the board must
focus its efforts on the strategic priorities that it believes
will maximise the likelihood of success. The committee
welcomes engagement with shareholders and welcomes
feedback on the form and content of this report.
72
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Simon Costa
Chair of the remuneration committee
Directors’ remuneration
report
Policy, practices, supporting strategy.

Remuneration strategy
The current remuneration policy was approved by the shareholders at the 2022 AGM and was unchanged from the
policy approved at the 2019 AGM. In the light of David Kingerlee’s transfer of status from an executive director to a
non-executive director in 2021, and Simon Gill’s resignation as chief executive and feedback during the recruitment process
for his successor, the committee reconsidered the remuneration policy during the year. After the year end the committee and
board determined that the existing policy was overly complex for an organisation of Highcroft’s size and does not sufficiently
incentivise the executive directors. The committee and board have, therefore, approved a new remuneration policy designed
to continue to support strategy and to promote sustainable success, whilst incentivising the executives in a clear and less
complex manner. Thecommittee consulted major shareholders on this proposed policy and no concerns were raised.
Therevised policy will be proposed to shareholders for approval at the 2023 AGM.
Total remuneration – split between fixed
and performance-linked elements
Simon Gill 2021 2022
Fixed 37% 40%
Base salary 36% 39%
Pension and other benefits 1% 1%
Performance-linked 63% 60%
Highcroft Incentive Plan – cash 31% 31%
Highcroft Incentive Plan – share award 32% 29%
Roberta Miles 2021 2022
Fixed 37% 40%
Base salary 36% 39%
Pension and other benefits 1% 1%
Performance-linked 63% 60%
Highcroft Incentive Plan – cash 31% 31%
Highcroft Incentive Plan – share award 32% 29%
David Kingerlee
(for the period to 7 April 2021 when
he became a non-executive director) 2021
Fixed 62%
Base salary 60%
Pension and other benefits 2%
Performance-linked 38%
Highcroft Incentive Plan – cash 38%
Highcroft Incentive Plan – share award –
37%
63%
2021
37%
63%
2021
62%
38%
2021
40%
60%
2022
40%
60%
2022
Stock code: HCFT
highcroftplc.com
73
Our remuneration policy aligns
appropriate management
incentives with our strategy.

Summary
of directors’
remuneration policy
The objective of the group’s
remuneration policy is to embed a clear,
transparent remuneration structure,
which helps drive the group’s strategy
by properly rewarding performance.
This section of the report summarises
the group’s remuneration policy,
which was approved by shareholders
at the 2022 AGM. During the year, the
committee and the board considered
the elements of the policy and its link
to strategy and long-term sustainable
success and concluded that the
policy’s structure and operation
remained appropriate, but that for
executive directors the split between
base and variable salary, and the
relatively complex Highcroft Incentive
Plan, were no longer proportionate or
appropriate. The board and committee
have consulted with shareholders,
including a representative of the
Kingerlee Concert Party, in total
representing 40.95% of the company
and the Conn Concert party
representing 23.60% of the company
and there were no adverse comments
received and consequently have
agreed the policy that will be proposed
to shareholders for approval at the
2023 AGM. An ordinary resolution to
approve this is put to shareholders at
least every three years. The policy is
available on the group’s website:
www.highcroftplc.com.
The board’s policy is that the
remuneration of all directors should
reflect their experience and expertise,
and the particular value that they add
to the group. In addition, the packages
should be sufficient to attract and
retain individuals of an appropriate
calibre and capability and should
reflect the duties and responsibilities
of the directors and the value and
amount of time committed to the
group’s affairs. The packages should
continue to be aligned with our
remuneration philosophy with at least
one element of performance-related
pay for each executive director.
The remuneration packages of all
directors are reviewed annually, and
these are listed in the adjacent table,
together with an explanation of who
they apply to, their purpose, their link
to our strategy, the mechanics of the
operation of the element and any
maximum amounts or performance
criteria that apply.
Element Purpose Link to strategy Maximum
Executive directors
Fixed
Base salary
Competitive remuneration
base, benchmarked to
the market reflecting role,
responsibilities, skills and
experience
To assist with
recruitment and
retention
Not set
Pension
To provide the legal
minimum post-retirement
benefits
To assist with
recruitment and
retention
Not set
Benefits
Provide a competitive level
of benefits
To assist with
recruitment and
retention
The maximum
will be set at the
cost of providing
the benefits
described
Variable – old policy in place in 2022
The
Highcroft
Incentive
Plan
To incentivise the executive
directors to deliver both
strong in-year financial and
non-financial performance
and sustained longer-term
returns to shareholders
To assist with
recruitment and
retention. To
align executive
director interests
with those of
shareholders
Annual cash
award capped
at 10% of
distributions
paid to
shareholders
Up to 200% of
base salary
Variable – proposed new policy with effect from 1 January 2023
The
Highcroft
Bonus Plan
To incentivise the executive
directors to deliver both
strong in-year financial and
non-financial performance
and sustained longer-term
returns to shareholders
To assist with
recruitment and
retention
Annual cash
awards capped
at 10% of
distributions
paid to
shareholders
Up to 40% of
base salary
for the chief
executive and
100% of base
salary for the
finance director
Shareholding – old policy in place in 2022
Shareholding
requirement
To support long-term
commitment to the
company and the alignment
of executive director interests
with those of shareholders
To align the
executive
director interests
with those of
shareholders
100% of base
salary
Shareholding – proposed new policy
Shareholding
requirement
To support long-term
commitment to the
company and the alignment
of executive director interests
with those of shareholders
To align the
executive
director interests
with those of
shareholders
None
Chairman and non-executive directors
Fees
Competitive remuneration,
benchmarked to the
market reflecting role,
responsibilities, skills and
experience
To assist with
recruitment and
retention
Not set
74
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Directors’ remuneration report continued

Operation Performance target
Reviewed at least annually. Paid monthly via payroll N/A
There is an auto-enrolment compliant scheme in place.
The group will pay either to this, or another personal
pension scheme nominated by the director, at least
the minimum legal level of company auto-enrolment
contribution. The group may pay a non pensionable cash
sum in lieu of pension contributions
N/A
There is no intention to introduce a direct benefit
provision for the executive directors at this time. However,
the remuneration committee recognises the need to
maintain suitable flexibility to ensure it is able to attract
and retain directors. Accordingly, the remuneration
committee expects to be able to pay a cash allowance
in lieu of benefits such as private medical insurance and
death in service life assurance as appropriate
N/A
Annual awards paid part in cash and part in shares
The cash element shall be the higher of 80% of base
salary or 50% of the total award and will be paid out after
the end of the financial year to which the award relates
Any balance will be paid in the form of deferred shares
that vest 50% after three years, and 50% after four years
subject to the executive director’s continued employment
at the date of vesting
Malus will apply for the period from grant to vesting with
clawback applying for the two-year period post vesting
Performance is measured over the financial year
75% of the award is payable on the achievement of financial targets, with the
balance being payable on the achievement of strategic targets
The remuneration committee is of the opinion that given the commercial
sensitivity arising in relation to the detailed financial targets, disclosing precise
targets in advance would not be in shareholder interests. Actual targets,
performance achieved and awards made will be published at the end of the
performance periods so shareholders can fully assess the basis for any payouts
The remuneration committee retains discretion in exceptional circumstances
to change performance metrics and targets and the weightings attached
to metrics part way through a performance year if there is a significant and
material event that causes the remuneration committee to believe the original
metrics, weightings and targets are no longer appropriate. Discretion may
also be exercised in cases where the remuneration committee believe that the
formulaic outcome is not a fair and accurate reflection of business performance
Annual awards paid in cash As for the Highcroft Incentive Plan
The remuneration committee has adopted formal
shareholding guidelines that will encourage the executive
directors to build up over a five-year period and then
subsequently hold a shareholding equivalent to a
percentage of base salary
None
Executives will be encouraged, but not required, to build
up a shareholding in the company
None
Fees are reviewed annually taking into account
responsibilities, time commitment and benchmark data
for organisations of a similar size and complexity. Fees
are paid monthly via the payroll and relevant expenses
incurred are reimbursed
N/A
Stock code: HCFT
highcroftplc.com
75

The committee addressed the following factors when determining the remuneration policy and practices, as recommended
by the Code.
Code principles How the committee has addressed these
Clarity
Remuneration arrangements should
be transparent and promote effective
engagement with shareholders and
theworkforce
The committee is satisfied that the remuneration arrangements in the policy
are transparent, comprising simple incentive structures that are commonplace
in the market and in line insofar as is proportionate with best practice
remuneration provisions
Key shareholders were consulted when the remuneration policy was initially
adopted and are consulted prior to any updated policy being put to an AGM for
approval, which happens at least every three years and happened during the
current year. Our two employees are aware of the policy
Simplicity
Remuneration structures should avoid
complexity and their rationale and
operation should be easy to understand
The components of our remuneration policy are straightforward and are simple
to operate and communicate
The new remuneration policy aims to simplify the variable element of
remuneration as the previous scheme was considered unduly complex for a
small team of executive directors, was a disincentive for them and was difficult
to understand and costly to implement and run
Risk
Remuneration arrangements should
ensure reputational and other
risks from excessive rewards, and
behavioural risks that can arise from
target-based incentive plans, are
identified and mitigated
The range of performance outcomes is looked at carefully when setting
performance target ranges. Discretion is used where the outcomes lead to an
inappropriate pay outcome
The deferred element of the Highcroft Incentive Plan and the proposed
Highcroft Bonus Plan help to mitigate risk. The new remuneration policy
removes the shareholding requirement as the target holding did not
meaningfully align executive director interests with those of shareholders
Predictability
The range of possible values of rewards
to individual directors and any other
limits or discretions should be identified
and explained at the time of approving
the policy
Incentive plans are determined based on a proportion of base salary so there is
a sensible balance between fixed pay and performance-linked elements
There is the ability to override a formulaic driven outcome of incentive plans to
minimise the likelihood of a poor link between reward and performance
Proportionality
The link between individual awards, the
delivery of strategy and the long-term
performance of the company should
be clear. Outcomes should not reward
poor performance
The incentive plan is determined based on a proportion of base salary, and is
capped, so there is a sensible balance between fixed pay and
performance-linked elements. The relative proportions have been revised for
2023 having taken into account an informal benchmarking exercise
Alignment to culture
Incentive schemes should drive
behaviours consistent with company
purpose, values and strategy
The committee ensure that the Highcroft Incentive Plan and Highcroft Bonus
Plan criteria are consistent with the company purpose and values, and that the
performance measures are linked to the business strategy
Highcroft Incentive Plan – consequences of the proposed new
remuneration policy
If the new remuneration policy is approved at the 2023 AGM no further awards will be made under the Highcroft Incentive
Plan. The remuneration committee then intend to use their discretion to advance the vesting of the previously issued share
awards to the date of the AGM. This action has no effect on group cashflows or the calculation of the allowable costs for
calculating the PID pool. It will, however, enable future remuneration disclosures to be simplified and clearer. In 2023 there
would be a charge to the statement of comprehensive income of £78,721 that would have otherwise have been expensed
in2024–2026. In addition, as part of the rebalancing between fixed and variable elements of remuneration Roberta Miles’
basic salary will be increased.
76
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Directors’ remuneration report continued

Recruitment remuneration policy
The remuneration committee’s approach to recruitment remuneration is to apply the same structure as described in the
policy table. On appointment, base salary levels will be set taking into account a range of factors including expected time
commitment, market levels, experience, internal relativities and affordability. The maximum annual opportunity under the
new Highcroft Bonus Plan will be up to 40% of base salary for the chief executive and 100% of base salary for the finance
director as set out in the remuneration policy.
The remuneration committee’s policy is not to provide sign-on compensation or to provide buyouts as a matter of course.
However, should the remuneration committee determine that the individual circumstances of recruitment justified the
provision of a buyout, the equivalent value of any incentives that will be forfeited on cessation of a director’s previous
employment will be calculated, taking into account the proportion of the performance period completed on the director’s
cessation of employment, the performance conditions attached to the vesting of these incentives and the likelihood of them
being satisfied, and any other terms and conditions having a material effect on their value. The remuneration committee may
then grant up to the same value as this calculated value, where possible, under the company’s incentive plan. To the extent
that it is not possible or practical to provide the buyout within the terms of the company’s existing incentive plan, a bespoke
arrangement would be used.
Loss of office policy
The remuneration committee will honour any contractual arrangements. When determining any loss of office payment for
a departing individual, the remuneration committee will always seek to minimise cost to the company, whilst seeking to
address the circumstances at the time.
Leaving arrangements under the Highcroft Incentive Plan are defined in the plan rules and vary by leaver type as set
out below:
 A ‘good leaver’ is defined as a participant ceasing to be in employment by reason of death, injury, ill health, disability,
redundancy, retirement or otherwise at the remuneration committee’s discretion. In these circumstances, unvested
incentive awards will vest in full on the usual date but pro-rated for time served and the achievement of performance
conditions.
 The committee may, at its discretion, bring forward the vesting date for a good leaver, in which case the performance
would be assessed at that point.
 All other leavers who cease employment prior to the cash element of the incentive award being paid, or who are under
notice of cessation at the time that the cash element of the award is paid, will not be eligible to receive the cash element
of the award for that financial year, and all deferred shares for such leavers will lapse and any dividends paid on such shares
will be clawed back.
The committee have considered Simon Gill’s resignation against these criteria. They have concluded, using their discretion,
that Simon Gill is a good leaver given his significant contribution to the company over the last decade. The vested shares and
the shares that will vest in the future will be subject to the shareholding requirement in the 2022 remuneration policy.
Illustration of policy
The tables below illustrate the remuneration opportunity provided to each executive director in line with different levels of
performance for 2023 and in line with the existing remuneration policy.
£409,000
£308,000
£139,000
34%
66%
Maximum
45%
55%
On target
100%
Minimum
£115,000
£87,000
£39,000
34%
66%
Maximum
45%
55%
On target
100%
Minimum
£107,000
£95,000
£77,000
72%
28%
Maximum
Salar
y
, benefits and pension Hi
g
hcroft Bonus Plan
81%
19%
On target
100%
Minimum
Chief executive
(Paul Leaf-Wright)
Finance director
(Roberta Miles)
Executive director
(Simon Gill to 31 March 2023)
On target performance
Comprising base salary, pension allowances and an incentive plan payment at 62.5% of the maximum opportunity.
Maximum performance
Comprising base salary, pension allowances and an incentive plan payment at 100% of the maximum opportunity.
Minimum performance
Comprising the minimum remuneration receivable being base salary and pension allowances.
Stock code: HCFT
highcroftplc.com
77

Directors’ service contracts
Executive directors are given service contracts, within which there is a notice period by either party of six months.
Non-executive directors have a formal appointment document for a period of up to three years subject, at any time, to
termination on six months’ notice by either party. All directors retire and are subject to election at the first AGM after their
appointment. The board follows the Code recommendations in that all directors offer themselves for re-election at each AGM.
Consideration of employment conditions elsewhere in the company
There are two other part-time employees in the company, a company secretary and a management accountant, whose
salaries are decided by benchmarking to the market, their skills, experience, and contribution. The directors did not consult
with these employees in setting the directors’ remuneration policy as it was not considered appropriate to do so.
Consideration of shareholder views
During the year, the remuneration committee engages with key shareholders to ensure that their views are understood
when considering remuneration policy.
Audit
The law requires the group’s auditor, Mazars LLP, to report on whether the part of the directors’ remuneration report to be
audited has been properly prepared in accordance with the Companies Act 2006. Where disclosures have been audited, they
are indicated as such. The auditor’s opinion is included in the independent auditor’s report on pages 90 to 95.
Directors’ contracts
A summary of the directors’ contracts is set out below:
Non-executive directors
Date of appointment
as director
Effective date of current
appointment letter Expiry of term Notice period
Charles Butler 2 January 2018 2 January 2021 1 January 2024 Six months
Simon Costa 15 May 2015 15 May 2021 14 May 2024 Six months
David Warlow 1 August 2022 1 August 2022 1 August 2025 Six months
David Kingerlee
1
12 September 1996 7 April 2021 1 August 2022 Six months
1
Prior to 7 April 2021, David Kingerlee was an executive director and he resigned as a non-executive director with effect from 1 August 2022.
Executive directors
Date of appointment
as director Date of contract Notice period
Simon Gill
1
1 April 2013 7 December 2017 Six months
Paul Leaf-Wright 1 January 2023 3 January 2023 Six months
Roberta Miles 1 July 2010 7 December 2017 Six months
1
Resigned with effect from 31 March 2023.
Annual report on remuneration for the year
Relative importance of spend on pay
The directors are the only employees of the group, other than two part-time employees, the company secretary and the
management accountant.
2022
£’000
2021
£’000
2020
£’000
Directors’ remuneration 770 737 703
Increase in director’s remuneration
1
4.5% 4.8% 31.6%
Distributions paid to shareholders 2,909 3,007 2,484
Directors’ remuneration as a % of distributions paid to shareholders 26.5% 24.5% 28.3%
Cash element of directors’ incentive plan award as % of distributions paid to
shareholders 7.3% 7.2% 8.4%
1
In 2020, the accounting treatment for the PAYE/NI on the share award was altered – see page 80 for more details.
78
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Directors’ remuneration report continued

Directors’ remuneration 2022 (audited)
2022 2021
Base
salary
£
Pension/
pension
allowance
£
Incentive plan
Total
£
Base
salary
£
Pension/
pension
allowance
£
Incentive plan
Total
£
Cash
award
£
Share
award
1
£
Cash
award
£
Share
award
1
£
Charles Butler 53,000–––53,00050,000–––50,000
Simon Costa 40,500–––40,500 38,000–––38,000
Simon Gill 140,500 4,215 112,400 102,593 359,708 127,500 3,825 111,435 111,435 354,195
David Kingerlee
2
14,583–––14,583 28,250 285 5,928 - 34,463
Roberta Miles 124,000 3,720 99,200 90,545 317,465 112,500 3,375 98,325 98,325 312,525
David Warlow
3
4,167–––4,167–––––
Total 376,750 7,935 211,600 193,138 789,423 356,250 7,485 215,688 209,760 789,183
1
Award granted for the year. The 2021 figures have been restated as they previously represented the element relating to the financial year
including the proportion of previous year’s awards expensed in the financial year. In order to reconcile to note 4 to the consolidated financial
statements the share award expensed in the year of £173,644 from the deferred share element of award table overleaf has to replace the
share award for the year of £193,138 in the table above.
2
Executive director until 7 April 2021, then non-executive director until resignation on 1 August 2022.
3
Appointed 1 August 2022.
Highcroft Incentive Plan 2022
The maximum opportunity under the Highcroft Incentive Plan for 2022 was 200% of salary for Simon Gill and Roberta Miles.
The 2022 award was based on four performance measures as shown in the table below. The financial performance measures
are related to the weighted average relevant MSCI measure, which is deemed to be an appropriate relevant market index.
The relative weighting, thresholds and outcomes together with the 2022 outcome for the individual directors is tabulated below.
Performance
measure Weighting Threshold
% of
maximum
payout
Performance
agreed
Agreed %
outcome
Actual % of
maximum
awarded
Award as % of base salary
Simon Gill Roberta Miles
Cash
Deferred
shares Cash
Deferred
shares
Adjusted NAV per
share movement
30% (18.4)% 25% (11)% 80.1% 24.0%
(8.3)% 100%
Adjusted EPS
growth
30% 1.1% 25% 5% 74.2% 22.3%
7.1% 100%
Gross rent (ERV)
growth
15% 1.3% 25% 3% 34.8% 5.2%
8.0% 100%
Strategic personal
objectives 25%
Simon Gill 100.0% 25%
Roberta Miles 100.0% 25%
Total 100%
Simon Gill 76.5% 80.0% 73.0%
Roberta Miles 76.5% 80.0% 73.0%
Stock code: HCFT
highcroftplc.com
79

Deferred share element of award
The cost of the net pay, used to purchase shares for the deferred share element of the award is, for accounting purposes,
spread across the total service and vesting periods of the deferred shares, which are:
Deferral period
50% of the
award
years
50% of the
award
years
2019 award 3.77 4.77
2020 award 3.37 4.37
2021 award 3.46 4.46
2022 award 3.44 4.44
Deferred share element Expensed in
Base
salary
£
% of
base
salary
Gross
pay put
through
payroll
£
MV of
shares
issued
1
PAYE/
NI
payable
on
award
2
2019
£
2020
£
2021
£
2022
£
2023
£
2024
£
2025
£
2026
£
Simon Gill
2019 award 113,500 47.50% 53,913 28,574 12,802 768 6,785 5,913 2,306 – – –
25,339 25,339––––––
2020 award 125,000 55.23% 69,039 36,591 9,616 9,616 9,616 6,195 1,548 – –
32,448 32,448––––––
2021 award 127,500 87.40% 111,435 59,061 15,156 15,156 15,156 10,547 3,046 –
52,374 52,374–––––
2022 award 140,500 73.02% 102,593 56,426 14,556 14,556 14,556 9,963 2,795
46,167 46,167––––
12,802 68,171 83,931 91,408 38,213 26,651 13,009 2,795
Roberta Miles
2019 award 95,500 47.50% 45,363 24,042 10,771 646 5,709 4,975 1,941 – – –
21,321 21,321––––––
2020 award 110,000 55.23% 60,754 32,200 8,462 8,462 8,462 5,452 1,362 – –
28,554 28,554––––––
2021 award 112,500 87.40% 98,325 52,112 13,373 13,373 13,373 9,306 2,687 –
46,213 46,213–––––
2022 award 124,000 73.02% 90,545 47,328 12,209 12,209 12,209 8,357 2,344
43,217 43,217––––
10,771 58,983 73,756 82,236 32,974 22,877 11,044 2,344
Total 23,573 127,154 157,688 173,644 71,188 49,528 24,053 5,139
1
The MV of the shares issued is calculated by deducting the employee’s marginal rate of PAYE and NI from the gross award. For 2022 55% was used for Simon Gill
and 52.27% for Roberta Miles.
2
In 2020 the accounting treatment for the share award was altered, in that the PAYE/NI on the whole share award is expensed in the service period and only the
expense of the net salary used to acquire shares is spread across the total service and vesting period. This resulted in a net additional expense of £35,580 related to
the 2019 share award being charged in 2020, together with £10,447 of employers’ national insurance.
80
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Directors’ remuneration report continued

Awards of prior years
The 2019, 2020 and 2021 awards were paid via the payroll in the year after the year of award and the net sum (calculated as
53% of the gross sum, after deducting PAYE and NI) was used to purchase new shares at the average of the closing share
price for the previous three working days.
2019 award 2020 award 2021 award Total
Date
shares
purchased
Number
of
shares
Purchase
price at
£6.63 per
share
£
Date
shares
purchased
Number
of
shares
Purchase
price at
£8.07 per
share
£
Date
shares
purchased
Number
of
shares
Purchase
price at
£9.87 per
share
£
Purchase
price
£
Value at 31
December
2022 at
£9.30 per
share
£
Simon Gill
5 May
2020 4,309 28,569
12 April
2021 4,534 36,589
31 March
2022 5,984 59,061 124,219 137,891
Roberta
Miles
5 May
2020 3,626 24,040
12 April
2021 3,990 32,199
31 March
2022 5,280 52,114 108,353 119,933
During the year the following number of shares related to the 2019 award vested: Simon Gill 2,154, Roberta Miles 1,813.
Remuneration of the chief executive (CEO)
The table below shows the total remuneration of Simon Gill (from 31 July 2013) and Jonathan Kingerlee (deceased)
(until 31 July 2013) in respect of their role as CEO, together with the annual percentage change.
2022
£’000
2021
£’000
2020
£’000
2019
£’000
2018
£’000
2017
£’000
2016
£’000
2015
£’000
2014
£’000
2013
£’000
Fixed remuneration
Simon Gill 145 131 129 113 108 98 95 70 51 21
Jonathan Kingerlee (deceased) – ––––––––20
Variable remuneration
Simon Gill 204 195 168 104 101 94 87 82 60 –
Total remuneration
Simon Gill 349 326 297 217 209 192 182 152 111 21
Jonathan Kingerlee (deceased) – ––––––––20
349 326 297 217 209 192 182 152 111 41
Percentage change in total
remuneration of CEO 7% 10% 37% 4% 9% 5% 20% 37% 171% 17%
Annual variable element award
payout against maximum
opportunity
1
77% 87% 68% 64% N/A N/A N/A N/A N/A N/A
1
The Highcroft Incentive Plan was introduced in 2019. Prior to that, any bonuses paid were entirely discretionary with no maximum opportunities defined.
If the share price increased, there would be no effect on the remuneration of the CEO as disclosed above.
Executive directors’ remuneration 2022
The charts below show the 2022 actual remuneration against the potential opportunity for the year and also the 2021 actual
remuneration for each executive director. Full disclosure of the single total figure for remuneration is set out above.
Base salary Pension Incentive Plan/Discretionary bonus
£359,708
£425,715
£354,19563%
39% 60%
2022 actual
33% 66%
2022 potential
36%
2021 actual
£317,465
£375,720
£312,52563%
39% 60%
2022 actual
33% 66%
2022 potential
36%
2021 actual
Simon Gill
Chief executive
Roberta Miles
Finance director
Stock code: HCFT
highcroftplc.com
81

Annual percentage change in remuneration of directors and employees
The table below shows a comparison of the annual change of each individual director’s pay. As there are only two non
boardemployees, one of whom started in 2021, it is not considered appropriate or beneficial to include that information
as a comparator.
2021–2022 2020–2021 2019–2020
Change in pay
between the years
Base
salary/
fees %
change
Pension
allowance
% change
Incentive plan
Base
salary/
fees %
change
Pension
allowance
% change
Incentive plan
Base
salary/
fees %
change
Pension
allowance
% change
Incentive plan
Cash
award %
change
Share
award %
change
2
Cash
award %
change
Share
award %
change
2
Cash
award %
change
Share
award %
change
2
Executive
directors
Simon Gill 10% 10% 1% (8%) 2% 2% 11% 61% 10% 100% 10% 28%
David Kingerlee
(to 7 April 2021)
1
(100%) (100%) (100%) – 0% 0% 1% – 6% 67% (9%) –
Roberta Miles 10% 10% 1% (8%) 2% 2% 12% 62% 15% 15% 15% 34%
Non-executive
directors
Charles Butler 6% –––2% –––23% –––
Simon Costa 7% –––3% –––17% –––
David Kingerlee
(from 7 April 2021 to
1 August 2022)
1
0% –––(19%) ––– – –––
David Warlow
(from 1 August 2022) 100% – – – – – – – – – – –
1
David Kingerlee’s percentage change has been calculated on a pro-rata basis and to his 2021 non-executive remuneration.
2
The % change is calculated by reference to the gross value of the award and not the amount expensed in the year.
Company performance
The board is responsible for the group’s performance.
The graph below shows the company’s Total Shareholder Return (TSR) compared to the FTSE 350 Super Sector Real Estate
Index over the last ten years, which the board considers to be the most appropriate benchmark. TSR is defined as share price
growth plus reinvested dividends.
86
,
710
2013
2014 2020
300
200
250
150
100
50
2015 2016 2017
2018
2019
2021 2022
£’000
Statement of implementation of remuneration policy in the next
financial year
The board, as explained above, is proposing a new remuneration policy to the 2023 AGM. No further changes are proposed
during 2023.
Salaries 2023
The committee undertook a benchmarking exercise with PwC at the beginning of 2019. At the end of each subsequent year,
the committee carried out their own informal internal update of this exercise and reviewed the board salaries against wider
market practice. The following base salaries apply from 1 January 2023:
Simon Gill £152,500 Charles Butler £58,000
Paul Leaf-Wright £75,000 Simon Costa £44,000
Roberta Miles £135,000 David Warlow £11,000
If the new remuneration policy is approved at the AGM Roberta Miles’ base salary for 2023 will increase to £180,000.
Highcroft Investments
FTSE 350/Real Estate – SEC
82
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Directors’ remuneration report continued

Highcroft Incentive Plan 2023
It is intended that this plan will not be used for any future awards.
Highcroft Bonus Plan 2023
The maximum opportunity under the Highcroft Bonus Plan for 2023 will 40% of salary for the chief executive and 100% of
salary for the other executive directors. The awards will be based on performance measures including but not limited to:
 NAV per share performance
 Adjusted EPS performance
 Gross rent growth
 Strategic metrics (non-financial)
Performance targets for the Highcroft Bonus Plan for 2023 are not disclosed here on the grounds of commercial sensitivity,
and will be disclosed in the 2023 directors’ remuneration report.
Interests of the directors in the shares of the company (audited)
The interests of the directors, and their connected persons, in the shares of the company at 31 December 2022, were as follows:
Held under
the Highcroft
Incentive
Plan
1
Held
directly Total
Charles Butler – – –
Simon Costa – – –
Simon Gill 12,673 2,154 14,827
David Warlow – 1,421,063 1,421,063
Roberta Miles 11,083 7,763 18,846
1
The shares held under the Highcroft Incentive Plan include all those issued in prior years, see page 81 (awards of prior years), less those vested, all of which are
subject to malus and clawback in accordance with the 2022 remuneration policy (pages 74 to 75).
Director’s shareholding guideline
Under the existing remuneration policy executive directors are subject to within-employment and post-employment
shareholding requirements – see pages 74 to 75.
They are encouraged to build up over a five-year period from May 2020; a holding equivalent to 100% of base salary.
At 31 December 2022, the executive directors are on track to build up, on a straight-line basis, to their shareholding guideline
within the five-year period.
Executive director
Beneficially
held shares
1
2022 base
salary
£
Target by
May 2025
£
Achieved at
31 December
2022
Value of
beneficially
held shares
£
Simon Gill 14,827 140,500 140,500 98.1% 137,891
Roberta Miles 18,846 124,000 124,000 141.3% 175,268
1
The number of shares includes those issued in their name but not yet vested under the Highcroft Incentive Plan.
The value of the executive directors’ shareholdings has been calculated using the closing price at 31 December 2022 of £9.30.
Statement of shareholder voting
At the AGM in 2022, the resolution to approve the directors’ remuneration report received the following voting from shareholders:
Votes cast in favour 2,982,739 99.91%
Votes cast against 2,627 0.09%
Total votes cast 2,985,366 100%
Votes withheld ––
Approved by the board of directors and signed by
Simon Costa
Chair of the remuneration committee
27 March 2023
Stock code: HCFT
highcroftplc.com
83

The corporate governance report on pages 52 to 87 forms
part of the report of the directors.
The directors present their report together with the audited
financial statements for the year ended 31 December 2022.
The principal activity of the group continues to be property
investment.
Directors
The directors, who served throughout the year, are
listed below:
Charles Butler Non-executive chairman
Simon Costa Senior independent
non-executive director
Simon Gill Chief executive
David Kingerlee
(resigned 1 August 2022)
Non-executive director
1
Roberta Miles Finance director
David Warlow
(appointed 1 August 2022)
Non-executive director
1
1
David Kingerlee was, from 7 April 2021 until his resignation, and David Warlow
is, from his appointment, a shareholder representative for Kingerlee Holdings
Limited and consequently for these periods were both non-independent
non-executive directors as explained on page 62.
On 1 January 2023, Paul Leaf-Wright was appointed as chief
executive and Simon Gill changed his role to executive
director. Simon Gill has resigned from the board with
effectfrom 31 March 2023.
The board recognises the requirement of the UK Corporate
Governance Code regarding the segregation of roles and
division of responsibilities between the chairman and chief
executive, and between the leadership of the board and the
executive leadership of the business and has complied with
these requirements during the year.
The interests of the directors in the shares of the company
are included in the remuneration report on page 83.
In accordance with the Code, all continuing directors will
retire and offer themselves for election or re-election at the
forthcoming 2023 AGM.
The board confirms that following performance evaluations,
and review by the nomination committee, the performance
of each director continues to be effective and that they
demonstrate commitment to their role. The board believes
that it is in the best interest of shareholders that these
directors be re-elected.
Financial instruments
The groups exposure to, and management of, capital
riskand liquidity risk is in Note 18 to the consolidated
financial statements.
Structure of share capital and
rights and obligations attaching
to shares
The company’s allotted and issued share capital, as at
31 December 2022, was £1,298,741 (2021 £1,295,925) divided
into 5,194,963 (2021 5,183,699) ordinary shares of 25p each,
each of which was called up and fully paid. There have been
no changes to the share capital since the year end.
Subject to the Companies Act for the time being in force
(the Act), the company’s articles of association confer on
holders the following principal rights:
 To receive a dividend
The profits of the company available for dividend, and
resolved to be distributed, shall be applied in the payment
of dividends to the members and to persons becoming
entitled to shares by transmission, in accordance with
their respective rights and priorities. The company in
general meeting may declare dividends accordingly.
 To a return of capital or assets, if available, on
liquidation
Upon any winding up of the company, the liquidator may,
with the sanction of a special resolution of the company
and any other sanction required by the statutes, divide
among the members in specie the whole or any part of
the assets of the company and may, for that purpose,
value any assets and determine how the division shall be
carried out as between the members of different classes
of members.
 To receive notice of, attend and vote at an AGM
At each AGM, upon a show of hands, every member
present in person or by proxy shall have one vote, and
upon a poll, every member present in person or by proxy
shall have one vote for every share of which they are the
holder.
 To have, in the case of certificated shares, rights
in respect of share certificates and share transfers
Every person whose name is entered as a member in
the register as the holder of any certificated share shall
be entitled without payment to one certificate for all
the shares of each class held by them or, upon payment
of such reasonable out-of-pocket expenses for every
certificate after the first as the board shall from time to
time determine, several certificates each for one or more
of their shares. On any transfer of shares, the transferor
shall be deemed to remain the holder of the share until
the name of the transferee is entered in the register in
respect thereof.
84
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Report of the directors

Substantial shareholders
As at 31 December 2022, the following notifications of interests in 3% or more of the company’s ordinary share capital in issue
had been received:
Beneficial Number of shares
D G & M B Conn and associates 23.60% 1,226,205
Controlling shareholder – Kingerlee
Concert Party comprising
– the wholly owned subsidiaries of Kingerlee Holdings Limited:
– Kingerlee Limited 9.91% 515,000
– Kingerlee Homes Limited 7.92% 411,293
– T H Kingerlee & Sons Limited 9.52% 494,770
Total – Kingerlee Holdings Limited 27.35% 1,421,063
– other associates 13.60% 706,319
Total – Kingerlee Concert Party 40.95% 2,127,382
Controlling shareholder
A controlling shareholder is defined by the FCA as ‘any
person who exercises or controls, on their own or together
with any other person with whom they are acting in
concert, 30% or more of the votes able to be cast on all
or substantially all matters at general meetings of the
company’. The directors are aware that the shareholdings of
Kingerlee Holdings Limited and its subsidiaries referred to
in the previous table, together with their connected parties
and associates, form the Kingerlee Concert Party, which, as
at 27 March 2023, held 2,127,382 ordinary shares, representing
40.95% of the company’s issued share capital. The Kingerlee
Concert Party is, therefore, a controlling shareholder. The
persons comprising the Kingerlee Concert Party were
confirmed by the Takeover Panel in 1999. The company
can confirm that, in accordance with these rules:
 It entered into a controlling shareholder agreement (CSA)
with the Kingerlee Concert Party on 13 November 2014;
 The company has complied with the independence
provisions in the CSA from 1 January 2022 until
31 December 2022 (the period);
 So far as the company is aware, the independence
provisions in the CSA have been complied with by
the controlling shareholder and its associates in the
period; and
 So far as the company is aware, the procurement
obligation in the CSA has been complied with by the
controlling shareholder in the period.
The CSA contains undertakings that inter alia:
 Transactions and relationships with the controlling
shareholder (and/or any of its associates) will
be conducted at arm’s length and on normal
commercial terms;
 Neither the controlling shareholder nor any of its
associates will take any action that would have the effect
of preventing the company or any member of its group
from complying with its obligations under the Listing
Rules; and
 Neither the controlling shareholder nor any of its
associates will propose or procure the proposal of a
shareholder resolution, which is intended or appears to
be intended to circumvent the proper application of the
Listing Rules.
The directors have put in place measures to ensure that
the election or re-election by the shareholders of any
independent non-executive director should be approved by
an ordinary resolution of the shareholders and separately
approved by those shareholders who are not controlling
shareholders, the independent shareholders.
Directors’ indemnification
and insurance
The company’s articles of association provide for the
directors’ and officers of the company to be appropriately
indemnified, subject to the provisions of the Companies Act
2006. The company purchases and maintains insurance for
the directors and officers of the company in performing their
duties, as permitted by section 233 Companies Act 2006.
Stock code: HCFT
highcroftplc.com
85

Greenhouse gas emissions
Under the Companies Act 2006 (Strategic and Directors’
Reports) Regulations 2013, the company is required to report
annual greenhouse gas emissions.
In considering their obligations, the directors have taken into
account the following factors:
 The group operates from a two-desk serviced office of
approximately 200 sq ft within a larger building and has
no direct responsibility for energy usage. Energy use,
given the space occupied, is immaterial compared to
other uses shown below and would be impracticable
to collect.
 The annual energy cost for which we were responsible
within the property portfolio has this year for the first time
exceeded 40,000kWh. This increase from last year was
due primarily to the works undertaken at the void Cardiff
office property of 17,797 sq ft.
 The car fuel used by the group and its advisers is
considered immaterial.
On this basis, the directors are reporting for the first time in
accordance with the 2013 Regulations as below and as such
there is no comparable data for last year:
2022
Scope 1 – Direct
emissions
Combustion of fuel and
operation of facilities
0 (Note 1)
Scope 2 – Indirect
emissions
Purchased electricity
(location-based)
79,952 kWh
15,461 kg CO
2
(Note 2)
Scope 3 – Indirect
emissions
0 (Note 3)
Note 1: As stated above, the group operates from a serviced
office and has no direct responsibility for energy usage.
Note 2: The annual energy costs for the limited shared areas
within the portfolio was 18,796 kWh, 3,634 kg CO
2
. During
2022 there was a significant amount of improvement and
dilapidations work carried out at our void Cardiff property, for
which the group is responsible. This work is now completed.
For 2022, the energy usage for Cardiff was 61,156 kWh,
11,826 kg of CO
2
, converted using the DEFRA Electricity
conversion rate.
Note 3: We are continuing to investigate the best means of
measuring and attributing our indirect Scope 3 emissions.
Methodology
The GHG sources that constituted our operational boundary
for the year are:
Scope 1: Direct GHG emissions created when we used fossil
fuels in company-owned facilities and equipment, which we
consider immaterial.
Scope 2: Indirect GHG emissions cause by those who supply
us with energy, including electricity.
Scope 3: All other indirect GHG emissions from the whole
value chain. We are investigating the best means of
measuring and attributing our indirect Scope 3 emissions
since this involves liaison with our suppliers and tenants up
and down the value chain.
Baseline data: As this is the first year that we have fallen
into scope of these regulations, 2022 data will be used as our
baseline data.
Energy Saving initiatives: During the year, we sought to
make energy savings including upgraded LED lighting,
and to encourage energy savings by reducing car parking
spaces and providing cycle racks all at our property in Cardiff.
The board also agreed to address the EPC ratings of the
portfolio, primarily focusing on any properties that fall below
the Minimum Energy Efficiency Standards to be introduced
from 1 April 2023. (See Sustainability section on pages 48 to
50 for further details).
Engagement with customers,
suppliers and others who have
a business relationship with
the company
The directors work closely with tenants, potential tenants and
key members of our advisory team. During 2022, due to the
news ways of working arising from the Covid-19 pandemic,
our interactions have continued to be mixture of face-to-face
and virtual. More detail can be found on pages 46 to 47.
Dividends
The dividends paid by the company during the year and
declared prior to the publication of this report are set out in
Note 6 of the consolidated financial statements on page 105.
Charitable donations
During the year, the group made charitable donations of
£12,000. More detail can be found on page 51.
Disclosure of information to
the auditor
So far as the directors who held office at the date of approval
of this directors’ report are aware there is no relevant audit
information of which the auditor is unaware and each
director has taken steps that they ought to have taken as a
director to make themselves aware of any audit information
and to establish that the auditor is aware of that information.
Likely future developments in
the business of the company
In our strategic report we outlined our business model,
strategy and future opportunities for development. Read
more about this in our strategic report on pages 16 to 51.
Auditor
Mazars LLP have expressed their willingness to continue in
office as auditors and a resolution to appoint them will be
proposed at the forthcoming AGM.
Post balance sheet events
On 8 February 2023 the group exchanged and completed
on the sale of Its Llantrlsant asset that was classified as
held for sale at 31 December 2023. The gross sales proceeds
were £7,850,000, £1,100,000 in excess of the valuation at
31 December 2022.
This report was approved by the board.
Roberta Miles
Finance director
27 March 2023
86
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Governance
Report of the directors continued

The directors are responsible for preparing the annual
report, remuneration report and the financial statements
inaccordance with applicable law and regulations.
Company law requires the directors to prepare financial
statements for each financial year. Under that law, the
directors have prepared the group financial statements in
accordance with the Companies Act 2006 and International
Financial Reporting Standards (IFRS) as adopted for use
in the United Kingdom for the group, and have elected
to prepare the parent company financial statements in
accordance with United Kingdom Accounting Standards
(United Kingdom Generally Accepted Accounting Practice).
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 and of the profit or
loss of the company and group 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 estimates that are reasonable
andprudent;
 state whether applicable IFRSs and UK accounting
standards have been followed, 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
company will continue in business.
The directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the company’s transactions and disclose with reasonable
accuracy at any time the financial position of the company,
and enable them to ensure that the financial statements
and the remuneration report comply with the Companies
Act 2006 and Article 4 of the IAS Regulation. They are also
responsible for safeguarding the assets of the company
and group and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
In so far as each of the directors is aware:
 there is no relevant audit information of which the
company’s auditor is unaware; and
 the directors have taken steps that they ought to have
taken to make themselves aware of any relevant audit
information and to establish that the auditor is aware of
this information.
Under applicable law and regulations, the directors are also
responsible for preparing a strategic report, directors’ report,
directors’ remuneration report and corporate governance
statement that comply with that law and those regulations.
The directors are responsible for the maintenance and
integrity of the corporate and financial information included
on the company’s website: www.highcroftplc.com. Visitors
to the website should be aware that legislation in the United
Kingdom governing the preparation and dissemination of
financial statements may differ from legislation in other
jurisdictions.
Responsibility statement of
directors in respect of the annual
financial report
We confirm that to the best of our knowledge:
 the financial statements have been prepared in
accordance with the Companies Act 2006 and
International Financial Reporting Standards (IFRS) as
adopted for use in the United Kingdom for the group and
United Kingdom Generally Accepted Accounting Practice
(United Kingdom Accounting Standards and applicable
laws) for the parent company, give a true and fair view of
the assets, liabilities, financial position and profit or loss
of the company and the undertakings included in the
consolidation taken as a whole;
 the annual report, including the strategic report, includes
a fair review of the development and performance of
the business and the position of the company and the
undertakings included in the consolidation taken as a
whole, together with a description of the principal risks
and uncertainties that they face; and
 the report and accounts, taken as a whole, are fair,
balanced, and understandable and provide the necessary
information for shareholders to assess the group’s
performance, business model and strategy.
On behalf of the board.
Charles Butler
Chairman
27 March 2023
Stock code: HCFT
highcroftplc.com
87
Statement of directors’ responsibilities
In respect of the annual report, remuneration report
and the financial statements

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Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial
statements
Contents
Independent auditor’s report 90
Consolidated statement of
comprehensive income 96
Consolidated statement of financial position 97
Consolidated statement of changesin equity 98
Consolidated statement of cashflows 99
Notes to the consolidated financialstatements 100
Company statement offinancialposition 114
Company statement of changes inequity 115
Notes to the company financialstatements 116
List of definitions 120
Group five-year summary (unaudited) 121
Directors and advisers 122

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90
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial statements
Independent auditor’s report
to the members of Highcroft Investments PLC
Opinion
We have audited the financial statements of Highcroft
Investments PLC (the ‘Parent Company’; the ‘Company’) and
its subsidiaries (the ‘Group’) for the year ended 31 December
2022 which comprise the Consolidated Statement of
Comprehensive Income, the Consolidated Statement of
Financial Position, the Consolidated Statement of Changes
in Equity, the Consolidated Statement of Cashflows, the
notes 1 to 21 to the consolidated financial statements,
including a summary of significant accounting policies, the
Company Statement of Financial position, the Company
Statement of Changes in Equity and notes 1 to 13 to the
financial statements, including a summary of significant
accounting policies.
The financial reporting framework that has been applied
in their preparation is applicable law and UK-adopted
International Accounting Standards and, as regards the
Parent Company financial statements, as applied in
accordance with the provisions of the Companies Act 2006.
In our opinion, the financial statements:
 give a true and fair view of the state of the Group’s and of
the Parent Company’s affairs as at 31 December 22 and of
the Group’s loss for the year then ended;
 have been properly prepared in accordance with
UK-adopted International Accounting Standards and,
as regards the Parent Company financial statements,
as applied in accordance with the provisions of the
Companies Act 2006; and
 have been prepared in accordance with the requirements
of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities under those standards are further
described in the “Auditor’s responsibilities for the audit
of the financial statements” section of our report. We are
independent of the Group and the Parent Company in
accordance with the ethical requirements that are relevant
to our audit of the financial statements in the UK, including
the FRC’s Ethical Standard as applied to listed entities and
public interest entities and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to
going concern
In auditing the financial statements, we have concluded that
the directors’ use of the going concern basis of accounting in
the preparation of the financial statements is appropriate.
Our audit procedures to evaluate the directors’ assessment
of the Group’s and the Parent Company’s ability to continue
to adopt the going concern basis of accounting included but
were not limited to:
 Undertaking an initial assessment at the planning stage
of the audit to identify events or conditions that may
cast significant doubt on the Group’s and the Parent
Company’s ability to continue as a going concern;
 Evaluating the directors’ method to assess the Group’s
and the Parent Company’s ability to continue as a
going concern as approved by the board of directors on
27th March 2023;
 Making enquiries of directors to understand the period of
assessment considered by them, the assumptions they
considered and the implication of those when assessing
the Group’s and the Parent Company’s future financial
performance. This included examining the minimum
cash inflow and committed outgoings under the cash
flow forecasts and evaluating whether the directors’
conclusion that liquidity headroom remained in all
events was reasonable;
 Challenging the appropriateness of the directors’ key
assumptions in their cash flow forecasts, as described
in Note 1, by reviewing supporting evidence in relation
to these key assumptions and assessing the directors’
consideration of severe but plausible scenarios. This
included assessing the viability of mitigating actions
within the directors’ control;
 Evaluating the key assumptions used and judgements
applied by the directors in forming their conclusions on
going concern;
 Testing the accuracy used to prepare the directors’
forecasts; and
 Reviewing the appropriateness of the directors’
disclosures in the financial statements.
Based on the work we have performed, we have not
identified any material uncertainties relating to events
or conditions that, individually or collectively, may cast
significant doubt on the Group’s and the Parent Company’s
ability to continue as a going concern for a period of at least
twelve months from when the financial statements are
authorised for issue.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report.
In relation to Highcroft Investments PLC’s reporting on how
it has applied the UK Corporate Governance Code, we have
nothing material to add or draw attention to in relation to
the directors’ statement in the financial statements about
whether the director’s considered it appropriate to adopt
the going concern basis of accounting.

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Key Audit Matters
Key Audit Matters are those matters that, in our professional judgement, were of most significance in our audit of the
financial statements of the current period and include the most significant assessed risks of material misstatement (whether
or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy; the allocation
of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context
of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
We summarise below the Key Audit Matter in forming our opinion above, together with an overview of the principal audit
procedures performed to address each matter and our key observations arising from those procedures.
The matter, together with our findings, were communicated to those charged with governance through our Audit
Completion Report.
Key Audit Matter How our scope addressed this matter
Investment property valuation
The Group has a portfolio of investment properties
consisting of warehouse/industrial, retail warehouse,
high street retail, office and leisure in England and Wales.
The Group’s investment properties were carried at £77.9m
as at 31 December 2022.
The valuations were carried out by the third party valuer
Knight Frank (the ‘valuer’). The valuer was engaged by the
Directors and performed their work in accordance with the
Royal Institute of Chartered Surveyors (“RICS”) Valuation
– Professional Standards and the requirements of IAS 40
‘Investment property’.
Investment properties make up 90.3% of total assets by
value and is considered to be the key driver of commercial
property return for the Group and involves significant
level of judgement in ascertaining the fair value under
IFRS 13. The valuation of the investment properties is
inherently subjective due to, among other factors, the
individual nature of each property, its location and the
expected future rentals for that particular property. The
wider challenges currently facing the real estate sector, as
a result of regional and macroeconomic factors, further
contributed to the subjectivity in establishing valuations at
31 December 2022. As a result, the valuation of investment
properties is considered to be a Key Audit Matter.
Refer to page 64 (Report of the Audit Committee), pages 101
and 103 (Note 1 Significant accounting policies, accounting
estimates and judgments and investment property) and
pages 106 to 110 (Note 8 Investment property).
Our audit work included but was not limited to:
 Understanding management’s review controls on
the third-party valuation report by discussing with
management and performing a walkthrough to
understand the design and implementation of
review controls;
 Evaluating the valuer’s competence, capabilities
and objectivity;
 Obtaining the valuation reports and evaluating
that valuation approach was in accordance with
the RICS standards;
 For all properties, testing of completeness and accuracy
of data used in the valuation models and reviewing the
key assumptions made by the valuer and appraising
these against available market data such as locations
and market growth;
 On a sample basis, engaging our valuation specialist
to review reasonableness and suitability of the key
valuation assumptions and compare the property
valuations to publicly available recent comparable
property transactions; and
 Reviewing the adequacy of the disclosure in the financial
statements, including the valuation methodology,
assumptions and fair value hierarchy used.
Our observations
Based on the work performed and evidence obtained,
we consider the methodology and assumptions used
to value the investment properties to be appropriate.

92
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial statements
Independent auditor’s report continued
to the members of Highcroft Investments PLC
Our application of materiality and an overview of the scope of
our audit
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality.
These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and
extent of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect
of misstatements, both individually and on the financial statements as a whole. Based on our professional judgement, we
determined materiality for the financial statements as a whole as follows:
Group materiality
Overall materiality £863,000
How we
determined it
The overall Group statutory materiality has been calculated with reference to the Group’s total
assets, of which it represents approximately 1%.
Rationale for
benchmark
applied
Total assets have been identified as the principal benchmark within the financial statements as it is
considered to be the focus of the shareholders.
1% has been chosen to reflect the level of understanding of the stakeholders of the Group in relation
to the inherent uncertainties around accounting estimates andjudgements.
Performance
materiality
Performance materiality is set to reduce to an appropriately low level the probability that the
aggregate of uncorrected and undetected misstatements in the financial statements exceeds
materiality for the financial statements as a whole.
On the basis of our risk assessments, together with our assessment of the Group’s overall control
environment, we set performance materiality at £604,000 which is approximately 70% of overall
Group materiality.
Reporting
threshold
We agreed with the directors that we would report to them misstatements identified during our
audit above £26,000 as well as misstatements below that amount that, in our view, warranted
reporting for qualitative reasons.
Parent company materiality
Overall materiality £538,000
How we
determined it
The Parent Company’s statutory materiality has been calculated with reference to the Parent
Company’s total assets, of which it represents approximately 1%. For the purposes of the Group
audit, we capped the overall materiality for the company to be 62% of the Group overall materiality.
Rationale for
benchmark
applied
Total assets have been identified as the principal benchmark within the financial statements as it is
considered to be the focus of the shareholders.
1% has been chosen to reflect the level of understanding of the stakeholders of the Group in relation
to the inherent uncertainties around accounting estimates andjudgements.
Performance
materiality
Performance materiality is set to reduce to an appropriately low level the probability that the
aggregate of uncorrected and undetected misstatements in the financial statements exceeds
materiality for the financial statements as a whole.
On the basis of our risk assessments, together with our assessment of the Group’s overall control
environment, we set performance materiality at £376,000 which is approximately 70% of overall
company materiality.
Reporting
threshold
We agreed with the directors that we would report to them misstatements identified during our
audit above £16,000 as well as misstatements below that amount that, in our view, warranted
reporting for qualitative reasons.

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We also applied a lower level of specific materiality
for certain areas such as the revenue return of the
consolidated statement of comprehensive income,
directors’ remuneration and related party transactions.
As part of designing our audit, we assessed the risk of
material misstatement in the financial statements, whether
due to fraud or error, and then designed and performed
audit procedures responsive to those risks. In particular, we
looked at where the directors made subjective judgements,
such as assumptions on significant accounting estimates.
We tailored the scope of our audit to ensure that we
performed sufficient work to be able to give an opinion on
the financial statements as a whole. We used the outputs
of our risk assessment, our understanding of the Group and
the Parent Company, their environment, controls, and critical
business processes, to consider qualitative factors to ensure
that we obtained sufficient coverage across all financial
statement line items.
Our Group audit scope included an audit of the Group and
the Parent Company financial statements. Based on our
risk assessment, all components of the Group, including the
Parent Company, were subject to full scope audit performed
by the Group audit team. For each component in the scope
of the Group audit, we allocated a materiality that is less
than our overall Group materiality. The range of materiality
allocated across components was between £67,000 and
£756,000. For all components across the Group performance
materiality was set at 70%.
At the Parent Company level, the Group audit team also
tested the consolidation process and carried out analytical
procedures to confirm our conclusion that there were no
significant risks of material misstatement of the aggregated
financial information.
Other information
The other information comprises the information included
in the annual report other than the financial statements and
our auditor’s report thereon. The directors are responsible
for the other information. Our opinion on the financial
statements does not cover the other information and, except
to the extent otherwise explicitly stated in our report, we do
not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and,
in doing so, consider whether the other information is
materially inconsistent with the financial statements or our
knowledge obtained in the course of audit or otherwise
appears to be materially misstated. If we identify such
material inconsistencies or apparent material misstatements,
we are required to determine whether this gives rise
to a material misstatement in the financial statements
themselves. If, based on the work we have performed, we
conclude that there is a material misstatement of this other
information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters
prescribed by the Companies
Act 2006
In our opinion, the part of the directors’ remuneration report
to be audited has been properly prepared in accordance with
the Companies Act 2006.
In our opinion, based on the work undertaken in the course
of the audit:
 the information given in the strategic report and
the directors’ report for the financial year for which
the financial statements are prepared is consistent
with the financial statements and those reports have
been prepared in accordance with applicable legal
requirements;
 the information about internal control and risk
management systems in relation to financial reporting
processes and about share capital structures, given in
compliance with rules 7.2.5 and 7.2.6 in the Disclosure
Guidance and Transparency Rules sourcebook made
by the Financial Conduct Authority (the FCA Rules),
is consistent with the financial statements and has
been prepared in accordance with applicable legal
requirements; and
 information about the Parent Company’s corporate
governance code and practices and about its
administrative, management and supervisory bodies and
their committees complies with rules 7.2.2, 7.2.3 and 7.2.7
of the FCA Rules.
Matters on which we are required
to report by exception
In light of the knowledge and understanding of the Group
and the Parent Company and their environment obtained
in the course of the audit, we have not identified material
misstatements in the:
 strategic report or the directors’ report; or
 information about internal control and risk management
systems in relation to financial reporting processes and
about share capital structures, given in compliance with
rules 7.2.5 and 7.2.6 of the FCA Rules.
We have nothing to report in respect of the following matters
in relation to which the Companies Act 2006 requires us to
report to you if, in our opinion:
 adequate accounting records have not been kept by the
Parent Company, or returns adequate for our audit have
not been received from branches not visited by us; or
 the Parent Company financial statements and the part of
the directors’ remuneration report to be audited are not in
agreement with the accounting records and returns; or
 certain disclosures of directors’ remuneration specified by
law are not made; or
 we have not received all the information and explanations
we require for our audit; or
 a corporate governance statement has not been prepared
by the Parent Company.

94
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial statements
Independent auditor’s report continued
to the members of Highcroft Investments PLC
Corporate governance statement
The Listing Rules require us to review the directors’
statement in relation to going concern, longer-term viability
and that part of the Corporate Governance Statement
relating to Highcroft Investments PLC’s compliance with
the provisions of the UK Corporate Governance Statement
specified for our review.
Based on the work undertaken as part of our audit, we
have concluded that each of the following elements of the
Corporate Governance Statement is materially consistent
with the financial statements or our knowledge obtained
during the audit:
 Directors’ statement with regards the appropriateness of
adopting the going concern basis of accounting and any
material uncertainties identified, set out on page 45;
 Directors’ explanation as to its assessment of the entity’s
prospects, the period this assessment covers and why
they period is appropriate, set out on page 44;
 Directors’ statement on fair, balanced and
understandable, set out on page 66;
 Board’s confirmation that it has carried out a robust
assessment of the emerging and principal risks, set out
on page 38;
 The section of the annual report that describes the review
of effectiveness of risk management and internal control
systems, set out on page 68; and;
 The section describing the work of the audit committee,
set out on pages 63 to 68.
Responsibilities of directors
As explained more fully in the directors’ responsibilities
statement set out on page 87, the directors are responsible
for the preparation of the financial statements and for being
satisfied that they give a true and fair view, and for such
internal control as the directors determine is necessary to
enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are
responsible for assessing the Group’s and the Parent
Company’s ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors
either intend to liquidate the Group or the Parent Company
or to cease operations, or have no realistic alternative but
to do so.
Auditor’s responsibilities for the
audit of the financial statements
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free
from material misstatement, whether due to fraud or
error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance
but is not a guarantee that an audit conducted in
accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually
or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis
of these financial statements.
The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below.
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line
with our responsibilities, outlined above, to detect material
misstatements in respect of irregularities, including fraud.
Based on our understanding of the Group and the
Parent Company and their industry, we considered
that non-compliance with the following laws and regulations
might have a material effect on the financial statements:
compliance with the Real Estate Investment Trust
(REIT) status.
To help us identify instances of non-compliance with these
laws and regulations, and in identifying and assessing the
risks of material misstatement in respect to non-compliance,
our procedures included, but were not limited to:
 Gaining an understanding of the legal and regulatory
framework applicable to the Group and the Parent
Company, the industry in which they operate, and the
structure of the Group, and considering the risk of acts by
the Group and the Parent Company which were contrary
to the applicable laws and regulations, including fraud;
 Inquiring of the directors, management and, where
appropriate, those charged with governance, as to
whether the Group and the Parent Company is in
compliance with laws and regulations, and discussing
their policies and procedures regarding compliance with
laws and regulations;
 Inspecting correspondence with relevant licensing or
regulatory authorities;
 Reviewing minutes of directors’ meetings in the year; and
 Discussing amongst the engagement team the laws
and regulations listed above, and remaining alert to any
indications of non-compliance.

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We also considered those laws and regulations that have a
direct effect on the preparation of the financial statements,
such as the Listing Rules, UK Corporate Governance Code,
Disclosure Guidance and Transparency Rules, UK Tax
legislation and Companies Act 2006.
In addition, we evaluated the directors’ and management’s
incentives and opportunities for fraudulent manipulation of
the financial statements, including the risk of management
override of controls, and determined that the principal risks
related to posting manual journal entries to manipulate
financial performance, management bias through
judgements and assumptions in significant accounting
estimates, in particular in relation to revenue recognition
(which we pinpointed to the cut-off and accuracy), valuation
of investment property, and significant one-off or unusual
transactions.
Our procedures in relation to fraud included but were not
limited to:
 Making enquiries of the directors and management on
whether they had knowledge of any actual, suspected
or alleged fraud;
 Gaining an understanding of the internal controls
established to mitigate risks related to fraud;
 Discussing amongst the engagement team the
risks of fraud; and
 Addressing the risks of fraud through management
override of controls by performing journal entry testing.
The primary responsibility for the prevention and detection
of irregularities, including fraud, rests with both those
charged with governance and management. As with any
audit, there remained a risk of non-detection of irregularities,
as these may involve collusion, forgery, intentional omissions,
misrepresentations or the override of internal controls.
The risks of material misstatement that had the greatest
effect on our audit are discussed in the “Key Audit Matters”
section of this report.
A further description of our responsibilities is available on
the Financial Reporting Council’s website at www.frc.org.uk/
auditorsresponsibilities. This description forms part of our
auditor’s report.
Other matters which we are
required to address
Following the recommendation of the audit committee,
we were appointed by the audit committee on 12 May
2017 to audit the financial statements for the year ending
31 December 2017 and subsequent financial periods.
The period of total uninterrupted engagement is six
years, covering the years ending 31 December 2017 to
31 December 2022.
The non-audit services prohibited by the FRC’s Ethical
Standard were not provided to the Group or the Parent
Company and we remain independent of the Group and the
Parent Company in conducting our audit.
Our audit opinion is consistent with our additional report to
the audit committee.
Use of the audit report
This report is made solely to the company’s members
as a body in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken
so that we might state to the company’s members those
matters we are required to state to them in an auditor’s
report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility
to anyone other than the company and the company’s
members as a body for our audit work, for this report, or for
the opinions we have formed.
As required by the Financial Conduct Authority Disclosure
Guidance and Transparency Rule 4.1.14R, these financial
statements will form part of the ESEF-prepared annual
financial report filed on the National Storage Mechanism
of the Financial Conduct Authority in accordance with
the ESEF Regulatory Technical Standard (‘ESEF RTS’). This
auditor’s report provides no assurance over whether the
annual financial report will be prepared using the single
electronic format specified in the ESEF RTS.
Nargis Shaheen Yunis
(Senior Statutory Auditor) for and on behalf of Mazars LLP
Chartered Accountants and Statutory Auditor
30 Old Bailey
London
EC4M 7AU
27 March 2023

96
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial statements
Consolidated statement of
comprehensive income
for the year ended 31 December 2022
2022 2021
Note
Revenue
£’000
Capital
£’000
Total
£’000
Revenue
£’000
Capital
£’000
Total
£’000
Gross rental revenue 5,608 – 5,608 5,928 – 5,928
Property operating expenses 8 (333) – (333) (670) – (670)
Net rental income 5,275 – 5,275 5, 258 – 5,258
Profit on disposal of
investment property –––– 250 250
Valuation gains on
investment property – 605 605 – 9,925 9,925
Valuation losses on
investment property – (10,986) (10,986) – (1,170) (1,170)
Net valuation (losses)/gains
on investment property 8 – (10,381) (10,381) –8 , 7 5 58 , 7 5 5
Administration expenses 3 (1,1 91) – (1,19 1) (1,164) – (1,164)
Net operating profit/(loss)
before net finance expense 4,084 (10,381) (6 ,297) 4,094 9,005 13,099
Finance income 39 – 39 4–4
Finance expense (840) – (840) (855) – (855)
Net finance expense (801) – (801) (851) – (851)
Profit/(loss) before tax 3,283 (10,381) (7 ,098) 3,24 3 9,005 12,248
Income tax charge 5 (18) – (18) (304) – (304)
Profit/(loss) for the year
after tax 3,265 (10,381) (7 ,116) 2,939 9,005 11,944
Total profit/(loss) and
comprehensive income/
(loss) for the year
attributable to the owners of
the parent 3,265 (10,381) (7 ,116) 2,939 9,005 11,944
Basic and diluted
(loss)/earnings per share 7 (137 .0p) 230.5p
The total column represents the statement of total comprehensive income as defined in IAS 1.
The accompanying notes form an integral part of these financial statements.

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Consolidated statement of
financial position
at 31 December 2022
Note
2022
£’000
2021
£’000
Assets
Non-current assets
Investment property 8 71,160 87 ,565
Total non-current assets 71,160 87 ,565
Current assets
Trade and other receivables 10 1,143 2,87 6
Cash and cash equivalents 7, 2 0 6 5,715
Assets classified as held for sale 9 6, 750 –
Total current assets 15,099 8,591
Total assets 86,259 96,156
Liabilities
Current liabilities
Interest bearing loan 12 – 7 ,500
Trade and other payables 11 2, 883 2, 839
Total current liabilities 2,883 10,339
Non-current liabilities
Interest bearing loan 12 27 ,200 19, 700
Total non-current liabilities 27 ,200 19, 700
Total liabilities 30,083 30,039
Net assets 56,176 66,117
Equity
Issued share capital 13 1,299 1,296
Share premium 226 117
Share-based payment reserve 160 102
Revaluation reserve – property 11,499 19,236
Other equity reserve (207) (121)
Capital redemption reserve 95 95
Realised capital reserve 29,623 29 ,623
Retained earnings 13,481 15,7 69
Total equity attributable to the owners of the parent 56,176 66,117
These financial statements were approved by the board of directors on 27 March 2023.
Paul Leaf-Wright Charles Butler
Director Director
Company number: 00224271
The accompanying notes form an integral part of these financial statements.

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Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial statements
Consolidated statement of
changes in equity
2022
Issued
share
capital
£’000
Share
premium
£’000
Share-
based
payment
reserve
£’000
Revaluation
reserve –
property
£’000
Other
equity
reserve
£’000
Capital
redemption
reserve
£’000
Realised
capital
reserve
£’000
Retained
earnings
£’000
Total
£’000
At 1 January 2022 1,296 117 102 19,236 (121) 95 29,623 15,7 69 66,117
Transactions with
owners:
Issue of shares 3 109 – – (112) – – – –
Dividends – – – – – – – (2 ,909) (2,909)
3 109 – – (112) – – (2,909) (2,909)
Reserve transfers:
Non-distributable items
recognised in income
statement:
Revaluation losses – – – (10,381) – – – 10,381 –
Change in excess of cost
over fair value through
retained earnings – – – 2,644 – – – (2 ,644) –
Share award vested – – (26) – 26 – – – –
– – (26) (7 ,737) 26 – – 7 ,737 –
Share award expensed – – 84 – – – – – 84
Total comprehensive
loss for the year – – – – – – – (7, 116) (7 ,116)
At 31 December 2022 1,299 226 160 11,499 (207) 95 29,623 13,481 56,176
2021
Issued
share
capital
£’000
Share
premium
£’000
Share-
based
payment
reserve
£’000
Revaluation
reserve –
property
£’000
Other
equity
reserve
£’000
Capital
redemption
reserve
£’000
Realised
capital
reserve
£’000
Retained
earnings
£’000
Total
£’000
At 1 January 2021 1,294 51 43 12,814 (53) 95 28,995 13,882 57 ,121
Transactions with
owners:
Issue of shares 2 66 – – (68) – – – –
Dividends – – – – – – – (3, 007) (3,007)
2 66 – – (68) – – (3,007) (3,007)
Reserve transfers:
Non-distributable items
recognised in income
statement:
Revaluation gains – – – 8,755 – – – (8,755) –
Realised gains – – – – – – 250 (250) –
Surplus attributable to
assets sold in the year – – – (378) – – 378 – –
Change in excess of cost
over fair value through
retained earnings – – – (1,955) – – – 1,955 –
– – – 6 ,422 – – 628 (7 ,050) –
Share award expensed – – 59 – – – – – 59
Total comprehensive
income for the year – – – – – – – 11,944 11,944
At 31 December 2021 1,296 117 102 19,236 (121) 95 29,623 15,7 69 66,117

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Note
2022
£’000
2021
£’000
Operating activities
(Loss)/profit before tax (7 ,098) 12,2 48
Adjustments for:
Net valuation losses/(gains) on investment property 10,381 (8,755)
Net gain on disposal of investment property – (250)
Share-based payment expense 84 59
Finance income (39) (4)
Finance expense 840 855
Operating cashflow before changes in working capital and provisions 4,168 4,153
Decrease in trade and other receivables 1,732 391
Increase in trade and other payables 34 120
Cash generated from operations 5,9 34 4,664
Finance income 39 4
Finance expense (840) (855)
Income taxes paid (7) (311)
Net cashflows from operating activities 5,126 3,502
Investing activities
Sale of current assets – investment property 8 – 1,925
Purchase of non-current assets – investment property 8 (726) –
Net cashflows from investing activities (726) 1,925
Financing activities
Dividends paid (2,909) (3,007)
Repayment of bank borrowings (7 ,500) –
New bank borrowings 7 ,500 –
Net cashflows from financing activities (2,909) (3,007)
Net increase in cash and cash equivalents 1,491 2,420
Cash and cash equivalents at 1 January 5,715 3, 295
Cash and cash equivalents at 31 December 7, 2 0 6 5,715
Consolidated statement
of cashflows
at 31 December 2022

100
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial statements
Notes to the consolidated
financial statements
for the year ended 31 December 2022
1 Significant accounting policies
Highcroft Investments PLC is a company domiciled in the United Kingdom. The consolidated financial statements of the
company for the year ended 31 December 2022 comprise the company and its subsidiaries, together referred to as the group.
The principal activity of the group is investment in commercial property in England and Wales. The accounting policies
remain unchanged.
Basis of preparation
The financial statements have been prepared in accordance with the Companies Act 2006 and International Financial
Reporting Standards (IFRS) as adopted for use in the United Kingdom.
In light of the conflict in Ukraine, the legacy impact of Covid-19, together with the effect of the high level of inflation on the
UK economy, and the sectors in which the group and company operates, the directors have placed a particular focus on the
appropriateness of adopting the going concern basis in preparing the group’s and company’s financial statements for the
year ended 31 December 2022. The group’s and company’s going concern assessment considers the group’s and company’s
principal risks, identified on pages 40 to 43 of this document, and is dependent on a number of factors, including cashflow
and liquidity, continued access to borrowing facilities, and the ability to continue to operate the group’s and company’s
borrowings within its financial covenants. The debt has a number of financial covenants that the group is required to comply
with including an LTV covenant, a 12-month historical interest cover ratio, and the facility agreements have cure provisions in
the event of a breach. The going concern assessment is based on a 12-month outlook from the date of the approval of these
financial statements, using the group’s five-year forecast. This forecast is based on a reasonable scenario, which includes the
following key sensitivities:
 10% reduction in net income from our portfolio.
 A 20% increase in the forecast proposed capital expenditure.
 An increase in the assumed inflation rates by 5%.
Under this scenario, the group and company are forecast to maintain sufficient cash and liquidity resources and remain
compliant with their financial covenants.
The directors have also stress tested the forecasts considering the level of fall in income and valuations that would cause the
business to be unable to pay its liabilities as they fall due and have concluded that the possibility of these scenarios occurring
is remote.
Based on the consideration above, the board believes that the group and company have the ability to continue in business for
at least 12 months from the date of approval of the financial statements for the year ended 31 December 2022, and, therefore,
have adopted the going concern basis in the preparation of this financial information.
These financial statements have been prepared under the historical cost convention, as modified by the revaluation of
investment properties.
Analysis of statement of comprehensive income
The profit or loss section of the statement of comprehensive income is analysed into two columns, being revenue and capital.
The capital column comprises valuation gains and losses on property, profits and losses on disposal of property, and all gains
and losses on financial assets and the related tax impact. The revenue column includes all other items.
Accounting estimates and judgements
The preparation of financial statements requires management to make judgements, assumptions and estimates that affect
the application of accounting policies and amounts reported in the consolidated statement of comprehensive income and
consolidated statement of financial position. Such decisions are made at the time the financial statements are prepared and
adopted based on historical experience and other factors that are believed to be reasonable at the time. Actual outcomes
may be different from initial estimates and are reflected in the financial statements as soon as they become apparent. The
measurement of fair value and carrying investments at fair value through profit and loss constitutes the principal areas
of estimate and judgement exercised by the directors in the preparation of these financial statements. The valuation of
investment properties at fair value is carried out by external advisers who the directors consider to be suitably qualified to
carry out such valuations. The primary source of evidence for property valuations is recent, comparable market transactions
on arm’s-length terms. However, the valuation of the group’s property portfolio is inherently subjective, which may not
prove to be accurate, particularly where there are few comparable transactions. Key assumptions, which are also the major
sources of estimation uncertainty used in the valuation, include the value of future rental income, the outcome of future rent
reviews, the rate of voids and the length of such voids. Estimates and judgements are continually evaluated and are based on
historical information of the group, the best judgement of the directors, and are adjusted for current market conditions. In
the process of applying the group’s accounting policies, management is of the opinion that any instances of the application
of judgements did not have a significant effect on the amounts recognised in the financial statements.

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New accounting standards and interpretations
There are no new accounting standards or interpretations issued during the year that would materially affect the group.
There are no amendments to, or interpretations of, existing standards that are relevant to the group but are not yet effective
and have not been adopted.
Basis of consolidation
The group financial statements consolidate the financial statements of the company and its 100% subsidiaries: Rodenhurst
Estates Limited, BL (Wisbech) Limited and Belgrave Land (Wisbech) Limited, which are all made up to 31 December 2022,
also following consistent accounting policies. Unrealised profits or losses on intra-group transactions are eliminated in full.
Rental revenue as a lessor
Investment properties are leased to tenants under operating leases. The rental income receivable under these leases is
recognised in the statement of comprehensive income on a straight-line basis over the term of the lease. Any rent-free period
is spread over the period of the lease. Since the risks and rewards of ownership have not been transferred to the lessee, the
assets held under these leases continue to be recognised in the group’s accounts. Dilapidations’ income is recognised in the
statement of comprehensive income when the amount is receivable from the tenant.
Finance costs
Interest is recognised using the effective interest method, which calculates the amortised cost of a financial liability and
allocates the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated
future cash payments through the expected life of the financial liability to the net carrying amount of the financial liability.
Share-based employee remuneration
Share-based employee remuneration is determined with reference to the fair value of the cash award that is used to
purchase the newly issued shares at the date that the award is agreed and charged to the income statement over the
service and vesting period on a straight-line basis.
Expenses
All expenses are recognised in the statement of comprehensive income on an accrual basis.
Lease expenses
Lease expenses related to short-term leases, that are determinable on less than 12 months’ notice, are recognised on a
straight-line basis over the lease term.
Realised gains and losses
Realised gains and losses are calculated as the difference between the proceeds, less expenses, and the value of the asset at
the beginning of the financial year. The related revaluation gains or losses of previous years are transferred from revaluation
reserve to realised capital reserve when the asset is disposed of.
Income tax
Income tax on the profit or loss for the periods presented comprises current and deferred tax, except where it relates to
items charged directly to equity, in which case the related deferred tax is also charged or credited to equity. Income tax is
recognised in the income statement. As a REIT, tax is not payable on the income and gains generated in the tax-exempt
property business.
Deferred tax is provided using the balance sheet liability method, providing for temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted
at the balance sheet date, and any adjustment to tax payable in respect of previous years. Deferred tax liabilities are generally
recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that
taxable profits will be available, against which deductible temporary differences can be utilised.
The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of
equity investments, using tax rates enacted or substantively enacted at the date of the statement of financial position.

102
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Notes to the consolidated
financial statements
continued
for the year ended 31 December 2022
Financial statements
1 Significant accounting policies continued
Investment property
Investment property is that which is held either to earn rental income or for capital appreciation or for both. Investment
property is stated at fair value. An external independent valuation company, having an appropriate recognised professional
qualification and recent experience in the location and category of property being valued, values the properties every six
months. The fair values are based on market values, being the estimated amount for which a property could be exchanged
on the date of valuation between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing
wherein the parties had each acted knowledgeably, prudently and without compulsion.
An asset will be classified as a short-term investment within current assets when the decision has been made by the board to
dispose of it in its present condition and the sale is highly probable.
In accordance with IAS 40, a property interest under an operating lease is classified and accounted for as an investment
property on a property-by-property basis when the group holds it to earn rentals or for capital appreciation or both. Any such
property interest under an operating lease classified as an investment property is carried at fair value.
Acquisitions and disposals are recognised on the date of completion. Any unrealised gain or loss arising from a change in fair
value is recognised in the statement of comprehensive income.
Assets classified as held for sale
Where a board decision has been made to dispose of an investment property in its present condition prior to the year end,
and the following conditions are met; an active programme to locate a buyer has been initiated, the asset is being actively
marketed at a reasonable price, it is unlikely that there will be any significant changes to the plan to sell the asset and it is
regarded as highly probable that a sale will complete within one year, the property is included within current assets and
stated at fair value.
Trade and other receivables
Trade and other receivables, which are generally due for settlement, in advance, prior to the relevant quarter or month,
are recognised and carried at the original invoice amount less an allowance for any uncollectable amounts. The group
applies the IFRS 9 simplified approach to measuring expected credit losses, which uses a lifetime expected impairment
provision for all applicable trade receivables. In determining the expected credit losses, the group takes into account any
recent payment behaviours and future expectations of likely default events such as 90 days past due. Trade and other
receivables are written off once all avenues to recover the balances are exhausted. Receivables written off are no longer
subject to any enforcement activity.
Cash and cash equivalents
Cash and cash equivalents comprise cash available with an original maturity of less than three months .
Financial liabilities
The group’s financial liabilities include trade and other payables and borrowings.
Trade payables and borrowings are recognised initially at fair value less transaction costs and subsequently measured
at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any
discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included
in finance costs in the statement of comprehensive income.
Loans and borrowings are classified as current liabilities unless the group has an unconditional right to defer the settlement
of the liability for at least 12 months after the balance sheet date.
A financial liability is derecognised when it is extinguished, discharged, cancelled or expires.
Issued share capital
Ordinary shares are classified as equity because they do not contain an obligation to transfer cash or another financial asset.
Dividends are recognised as a liability in the period in which they are payable.
Share-based payment reserve
The share-based payment reserve includes the unissued element of the Highcroft Incentive Plan award that has been
recorded in the comprehensive income statement.

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Revaluation reserve – property
This revaluation reserve includes annual revaluation gains and losses less applicable deferred taxation and is
non-distributable.
Other equity reserve
The other equity reserve is debited with the value of the shares issued under the Highcroft Incentive Plan and credited with
the value of the shares as they vest.
Share premium
Share premium represents the excess over nominal value of the fair value consideration for equity shares net of expenses of
the share issue.
Capital redemption reserve
The capital redemption reserve is a statutory non-distributable reserve into which amounts are transferred following the
redemption or purchase of issued share capital.
Realised capital reserve
The realised capital reserve includes realised revaluation gains and losses less attributable income tax and are
non-distributable.
Retained earnings
Retained earnings include total comprehensive income less revaluation gains on properties and any applicable taxation less
dividends paid.
Segment reporting
The group has one main operating segment – commercial property – and, therefore, no additional segmental information
is required.A segment is a distinguishable cis required. A segment is a distinguishable component of the group whose operating results are regularly reviewed by the
group’s chief operating decision maker, who is the chief executive. For management purposes, the group uses the same
measurement policies as those used in its financial statements.
2 Segment reporting
The group is comprised of one main operating segment. All of the revenue is received from England and Wales.
In 2022, one tenant represented £684,000, 12.2% of the gross rental revenue of £5,608,000. In 2021, the largest tenant
represented £684,000, 11.5% of gross rental revenue .
3 Administrative expenses
2022
£’000
2021
£’000
Directors (Note 4) 877 837
Auditor’s fees
– Fees payable to the company’s auditor for the audit of the company’s accounts – current year
1
58 54
– Fees payable to the company’s auditor for other services 10 10
Staff costs – (excluding directors’ remuneration) 69 44
Other expenses 177 219
1,191 1,164
1 The audit fee for 2022 includes £11,710 (2021 £10,900) related to the completion of a group reporting questionnaire for the Kingerlee Holdings Limited’s auditor.
This amount is recoverable in full from Kingerlee Holdings Limited and has been netted off other expenses.

104
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Notes to the consolidated
financial statements
continued
for the year ended 31 December 2022
Financial statements
4 Directors
2022
£’000
2021
£’000
Remuneration in respect of directors was as follows:
Remuneration 770 738
Social security costs 107 99
877 837
The average number of employees was seven (2021 six), all of whom, other than a part-time management accountant and a
part-time company secretary, were directors of the group. All directors are considered to be key managers of the company.
More detailed information concerning directors’ remuneration is shown in the directors’ remuneration report.
5 Income tax charge
2022
£’000
2021
£’000
Current tax:
On revenue profits – current year
– prior year
11
7
–
–
On write-off of part of PID pool – 304
Income tax charge 18 304
During 2021 the group took advantage of HMRC Covid-19 concessions and wrote £1.6m off its outstanding PID pool, which
resulted in a tax charge of £304,000.
The tax assessed for the year differs from the standard rate of corporation tax in the UK of 19% (2021 19%).
The differences are explained as follows:
2022
£’000
2021
£’000
(Loss)/profit before tax (7,098) 12,248
(Loss)/profit before tax multiplied by the standard rate of corporation tax in the UK of 19%
(2021 19%) (1,349) 2,327
Effect of:
Profit not taxable as a result of REIT status 1,360 (2,327)
Tax due on non-payment of part of PID pool – 304
Adjustment in respect of prior year 7 –
Income tax charge 18 304
The Finance Act 2016 included legislation to reduce the main rate of UK corporation tax from 20% to 19% from 1 April 2017 and
to 17% from 1 April 2020. The rate reduction to 17% was subsequently reversed by the Finance Act 2020, such that the main
rate of UK corporation tax from 1 April 2021 remains at 19%. The Finance Act 2021 confirmed an increase of UK corporation tax
rate from 19% to 25% with effect from 1 April 2023 and this was substantively enacted by the statement of financial position
date and, therefore, included in these financial statements. Temporary differences have been remeasured using the enacted
tax rates that are expected to apply when the liability is settled or the asset realised.

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6 Dividends
In 2022, the following dividends have been paid by the company:
2022
£’000
2021
£’000
2021 Final: 33p per ordinary share (2020 30p) 1,714 1,555
2021 Special: nil per ordinary share (2020 6p) – 311
2022 Interim: 23p per ordinary share (2021 22p) 1,195 1,141
2,909 3,007
On 27 March 2023, the directors declared a final property income distribution for 2022 of £1,714,000, 33p per share, (2021 final
property income distribution of £1,714,000, 33p per share), payable on 2 June 2023 to shareholders registered on 21 April 2023.
7 Earnings per share
The calculation of earnings per share is based on the total loss after tax for the year of £7,116,000 (2021 profit £11,944,000)
and on 5,192,186 shares (2021 5,181,317), which is the weighted average number of shares in issue during the year ended
31December 2022. There are no dilutiv31 December 2022. There are no dilutive instruments.
In order to draw attention to the profit that is not due to the impact of valuation gains and losses that are included in the
statement of comprehensive income, but not available for distribution under the company’s articles of association, an
adjusted earnings per share based on the profit available for distribution of £3,265,000 (2021 £2,939,000) has been calculated.
2022
£’000
2021
£’000
Earnings:
Basic (loss)/profit for the year (7,116) 11,944
Adjustments for:
Profit on disposal of investment property – (250)
Net valuation losses/(gains) on investment property 10,381 (8,755)
Adjusted earnings 3,265 2,939
Per share amount:
(Loss)/earnings per share (unadjusted) (137.0p) 230.5p
Adjustments for:
Profit on disposal of investment property – (4.8p)
Net valuation (losses)/gains on investment property 199.9p (169.0p)
Adjusted earnings per share 62.9p 56.7p

106
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Notes to the consolidated
financial statements
continued
for the year ended 31 December 2022
Financial statements
8 Investment property
2022
£’000
2021
£’000
Total valuation at 1 January 87,565 82,060
Additions 726 –
Disposals – (3,250)
Revaluation gains 605 9,925
Revaluation losses (10,986) (1,170)
Valuation at 31 December 77,910 87,565
Less property held for sale categorised as current asset (Note 9) (6,750) –
Property categorised as fixed asset 71,160 87,565
In accordance with IAS 40, the carrying value of investment properties is their fair value as determined by independent
external valuers. This valuation has been conducted by Knight Frank LLP, as external valuers, and has been prepared as at
31December 2022, in accordanc31 December 2022, in accordance with the Appraisal and Valuation Standards of the Royal Institution of Chartered Surveyors,
onthe basis of market von the basis of market value.
The historical cost of the group’s investment properties is £74,686,000 (2021 £73,961,000).
Valuation process
The valuation reports produced by the independent external valuers are based on information provided by the group such
as current rents, terms and conditions of lease agreements, service charges and capital expenditure (if any). This information
is derived from the group’s property management and financial information systems and is subject to the group’s overall
control environment.
In addition, the valuation reports are based on assumptions and models used by the independent valuer. The assumptions
are typically market related such as yields and discount rates and are based on their professional judgement and market
observation. Each property is considered a separate asset class based on the unique nature, characteristics and risks of the
property.
Our independent valuers have provided an explanatory note on the market conditions at 31 December 2022: ‘Following the
government’s ‘mini-budget’ of 23 September 2022 and subsequent financial turmoil, we draw the group’s attention to a
recent combination of global inflationary pressures, significant currency movements and higher borrowing costs, which
may produce greater volatility in property markets over the short to medium term. It is apparent that consumer and investor
behaviour can change quickly during periods of such heightened volatility. Our opinions set out in this report are only valid as
at the valuation date’.
The executive director responsible for the valuation process verifies all major inputs to the external valuation reports, assesses
the individual property valuation changes from the prior year valuation report and holds discussions with the independent
valuer. When this process is complete, the whole board then meet the valuer in the presence of the auditor. The valuation
report is recommended to the audit committee, which considers it as part of its overall responsibilities.
Valuation technique
The fair value of the property portfolio has been determined using an income capitalisation technique whereby contracted
and market rental values are capitalised with a market capitalisation rate. The resulting valuations are cross checked
against the initial and equivalent yields and the fair market values per square foot derived from comparable recent market
transactions on arm’s-length terms.
These techniques are consistent with the principles in IFRS 13 Fair Value Measurement and use significant unobservable
inputs such that the fair value measurement of each property within the portfolio has been classified as level 3 in the fair
value hierarchy.

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Significant unobservable inputs
31 December 2022 Warehouse
Retail
warehouse Leisure Office
High street
retail Total
Valuation technique Income capitalisation
Fair value of property portfolio £’000 34,875 21,500 9,875 7,600 4,060 77,910
Area sq ft 583,499 133,726 88,145 29,567 12,622 847,559
Gross estimated rental
value (ERV) £’000 3,457 1,610 812 610 359 6,848
ERV per sq ft
1
Minimum £ 2.40 10.57 7.35 20.00 13.95
Maximum £ 12.40 24.35 26.26 22.06 28.72
Weighted average £ 8.51 12.95 11.53 20.86 23.14
Net initial yield
Minimum % 4.90 6.03 6.69 0.00 1.98
Maximum % 11.09 8.66 8.52 5.20 9.45
Weighted average % 8.56 7.19 7.41 2.17 5.87
1 In 2022 the ERV per sq ft was calculated as the average per property (previously the highest and lowest Zone rents were used).
31 December 2021 Warehouse
Retail
warehouse Leisure Office
High street
retail Total
Valuation technique Income capitalisation
Fair value of property portfolio £’000 39,800 24,250 10,750 7,800 4,965 87,565
Area sq ft 581,386 133,746 87,955 29,323 16,433 848,843
Gross estimated rental
value (ERV) £’000 3,310 1,557 812 600 382 6,661
ERV per sq ft
Minimum £ 2.40 11.33 7.50 20.00 70.00
Maximum £ 12.00 24.50 28.85 22.50 125.00
Weighted average £ 8.18 13.37 12.12 21.02 102.55
Net initial yield
Minimum % 4.31 5.02 2.93 0.00 0.00
Maximum % 11.98 8.44 7.73 4.39 8.94
Weighted average % 8.31 6.45 5.16 1.78 5.12

108
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Notes to the consolidated
financial statements
continued
for the year ended 31 December 2022
Financial statements
8 Investment property continued
Sensitivities of measurement of significant unobservable inputs
As set out on page 106, the valuation of the group’s property portfolio is open to judgements that are inherently subjective
by nature.
Unobservable input
Impact on the fair value measurement of a
significant increase in input
Impact on the fair value measurement of a
significant decrease in input
Estimated rental value (ERV) Increase Decrease
Net initial yield Decrease Increase
There is no inter-relationship between these two inputs.
Information about the impact of changes in unobservable inputs on the fair
value of the group’s propertyportfoliooup’s property portfolio
Sensitivities for changes in assumptions have been set out below at +/- 5% for ERV and +/- 50bps for IY, which are deemed
to be the levels that give a reasonable worst-case scenario given the like-for-like valuation fall of 11.8% already recognised in
the year.
31 December 2022
Warehouse
£’000
Retail
warehouse
£’000
Leisure
£’000
Office
£’000
High
street retail
£’000
Total
£’000
Fair value of property portfolio 34,875 21,500 9,875 7,600 4,060 77,910
Impact on valuation of:
+5% on ERV 1,717 1,073 492 380 207 3,846
-5% on ERV (1,719) (1,073) (492) (380) (197) (3,836)
-50bps on IY 249 157 68 58 53 917
+50bps on IY (245) (154) (67) (57) (41) (880)
31 December 2021
Warehouse
£’000
Retail
warehouse
£’000
Leisure
£’000
Office
£’000
High
street retail
£’000
Total
£’000
Fair value of property portfolio 39,800 24,250 10,750 7,800 4,965 87,565
Impact on valuation of:
+5% on ERV 1,989 1,210 536 390 245 4,370
-5% on ERV (1,989) (1,210) (536) (390) (245) (4,370)
-50bps on IY 354 204 119 69 50 796
+50bps on IY (347) (200) (116) (68) (49) (780)

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Additional property disclosures including property covenant information
Fourteen investment properties with a carrying amount of £54,935,000 (2021 13 properties with a valuation of £59,165,000) are
charged to Handelsbanken plc to secure the group’s short-term and medium-term loans.
The group leases out its commercial investment property under operating leases. The future minimum lease payments
receivable under non-cancellable leases are as follows:
2022
£’000
2021
£’000
Less than one year 5,335 5,518
Between one and five years 12,889 14,265
More than five years 10,364 12,393
28,588 32,176
Property disposals in 2021 related to our Andover property, which had a net book value at 31 December 2020 of £3,250,000,
which was disposed of for net consideration of £3,500,000, of which £1,575,000 was immediately placed as security with
Handelsbanken plc and is disclosed within other receivables at 31 December 2021 (Note 10) and £1,925,000 was added to cash.
In April 2022 the secured deposit was released as security by the bank and reclassified as cash at bank.
Property operating expenses are all analysed as arising from generating rental income and include the movement in the bad
debt provision.
9 Assets classified as held for sale
2022
£’000
2021
£’000
Investment property held for sale 6,750 –
At 31 December 2022, the directors were in the advanced stages of the potential sale of our Llantrisant property. The purchaser
completed their due diligence in February 2023 and the sale was exchanged and completed on 8 February 2023. The gross sales
proceeds were £7,850,000, £1,100,000 in excess of the valuation at 31 December 2022 and £899,000 in excess of cost.
10 Trade and other receivables
2022
£’000
2021
£’000
Trade receivables 196 310
Accrued rent receivable 806 868
Other receivables 141 1,698
1,143 2,876
Included in trade receivables are amounts due from tenants at each year end and include amounts invoiced on 25 December in
respect of rents in advance for the period 25 December to 24 March. At 31 December 2022, amounts due from tenants that were
more than 90 days overdue, which related to rents for 2022 or earlier, totalled £368,000 (2021£,000 (2021 £432,000), of this amount £350,000
related to 2021 or earlier. Trade and other receivables are shown after deducting a provision for bad and doubtful debts, which
excludes VAT, of £330,000 (2021 £471,000). The provision for doubtful debts is calculated as an expected credit loss on trade
and other receivables in accordance with IFRS 9 (see Note 1). The charge to the income statement in relation to write offs and
provisions made against doubtful debts was £31,000 (2021 £189,000). The expected credit loss is recognised on initial recognition
of a debtor and is reassessed at each reporting period. In order to calculate the expected credit loss, the group applies a
forward-looking outlook to historic default rates. In the current reporting period, the forward-looking outlook has considered
the impacts of the conflict in Ukraine, the legacy impacts of the Covid-19 pandemic and the effect of the high inflation rates in
the UK. The historic default rates used are specific to receivables that are 90 days past due. Specific provisions are also made
in excess of the expected credit loss where information is available to suggest that a higher provision than the expected credit
loss is required. In the current reporting period, an additional review of tenant debtors was undertaken to assess recoverability
in light of the difficult macro-economic climate and other factors. The directors consider that the carrying amount of trade
and other receivables is approximate to their fair value. There is no concentration of credit risk with respect to trade and other
receivables as all of the group’s tenants have terms that require them to pay their rent in advance.
Other receivables at 31 December 2021 included £1,575,000 given as security to Handelsbanken plc from the proceeds of sale
of our secured Andover property. The secured deposit was released to cash in April 2022.

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Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Notes to the consolidated
financial statements
continued
for the year ended 31 December 2022
Financial statements
11 Trade and other payables
2022
£’000
2021
£’000
Deferred income 1,142 1,040
Social security and other taxes 679 628
Other payables 1,062 1,171
2,883 2,839
The directors consider that the carrying value of trade and other payables approximates to their fair value.
12 Interest-bearing loan
2022
£’000
2021
£’000
Short-term bank loans due within one year – 7,500
Medium-term bank loans 27,200 19,700
The medium-term bank loans comprise amounts falling due as follows:
Between one and two years – –
Between two and five years 7,900 3,400
Over five years 19,300 16,300
27,200 19,700
Further analysis of the short-term and medium-term bank loans is set out on page 37.
The weighted average effective interest rate is 3.06% (2021 3.13%).
13 Share capital
The movement in the number of 25p ordinary shares in issue is shown below:
2022 2021
Number £’000 Number £’000
At 1 January 5,183,699 1,296 5,175,175 1,294
Issued under the Highcroft Incentive Plan 11,264 3 8,524 2
At 31 December 5,194,963 1,299 5,183,699 1,296
The directors monitor capital on the basis of total equity and operate within the requirements of the articles of association.
There was £nil of short-term debt and £27,200,000 of medium-term debt at 31 December 2022 (2021 £7,500,000 short-term
debt and £19,700,000 of medium-term debt).
The rights and obligations relating to the company’s share capital is summarised on page 84.

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14 Share premium
2022
£’000
2021
£’000
At 1 January 117 51
Issued under the Highcroft Incentive Plan 109 66
At 31 December 226 117
15 Capital commitments
At 31 December 2022 there were capital commitments of £136,000 (31 December 2021 £nil).
16 Contingent liabilities
There were no contingent liabilities at 31 December 2022 or at 31 December 2021.
17 Related party transactions
Kingerlee Holdings Limited owns, through its subsidiaries, 27.4% (2021 27.2%) of the company’s shares, and David Kingerlee
(who was a director of the company until 1 August 2022, and a shareholder of the company throughout the year) and David
Warlow (who was appointed a director of the company on 1 August 2022) are both directors and shareholders of Kingerlee
Holdings Limited. The transactions between the group and Kingerlee Holdings Limited or its subsidiaries were as follows:
2022
£’000
2021
£’000
Transactions by the company:
Property income distribution paid to related party 789 817
Recharge of Mazars fee for completion of group audit questionnaire 12 11
Licence fee for use of property and recharge of sundry costs paid to related party – 1
The company terminated its licence with Kingerlee Limited, a subsidiary of Kingerlee Holdings Limited, on 20 January 2021.
The company owns 100% of Rodenhurst Estates Limited and BL (Wisbech) Limited and Belgrave Land (Wisbech) Limited.
The transactions between these companies have been eliminated on consolidation. Details of the net assets and profit for
the financial year of these companies are set out on page 118 of this annual report.
The key management personnel are the directors of the group. Their remuneration is set out in Note 4. In addition,
the following directors received dividends, during their period of office, during the year in respect of their shareholdings:
2022
£’000
2021
£’000
Simon Gill 8 5
David Kingerlee (resigned 1 August 2022) 30 52
Roberta Miles 11 8

112
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Notes to the consolidated
financial statements
continued
for the year ended 31 December 2022
Financial statements
18 Financial instruments and financial risk
Categories of financial instruments
2022 2021
Carrying
amount
£’000
Gains/
(losses)
£’000
Carrying
amount
£’000
Gains/
(losses)
£’000
Financial assets measured at amortised cost:
Trade and other receivables 1,143 – 1,301 –
Cash and cash equivalents 7,206 – 5,715 –
8,349 – 7,016 –
Financial liabilities measured at amortised cost:
Interest-bearing loans 27,200 – 27,200 –
Trade and other payables 1,062 – 1,171 –
28,262 – 28,371 –
Fair value and maturity of financial instruments
The group has no derivative financial instruments. Exposure to credit, liquidity and market risks arises in the normal course
of the group’s business. At 31 December 2022, the group had £27,200,000 of medium-term borrowing (2021 £7,500,000
short-term borrowings and £19,700,000 of medium-term borrowing), of which £3,400,000 is repayable in 2026, £4,500,000 in
2027, £14,300,000 in 2029 and £5,000,000 in 2030 at fixed interest rates with a weighted average of 3.06% (2021 3.13%). The fair
values of loans and receivables and financial liabilities held at amortised cost were not materially different from book values.
A maturity analysis, based on contractual, undiscounted payments is set out below:
2022
Carrying
amount
£’000
Total
contractual
undiscounted
cashflow
£’000
Due within
1 year
£’000
Due in more
than 1 but
less than
2 years
£’000
Due in more
than 2 but
less than
5 years
£’000
Due in more
than 5 years
£’000
Bank loans 27,200 32,087 833 833 10,187 20,234
Trade and other payables 1,0621,0621,062 – – –
2021
Carrying
amount
£’000
Total
contractual
undiscounted
cashflow
£’000
Due within
1 year
£’000
Due in more
than 1 but
less than
2 years
£’000
Due in more
than 2 but
less than
5 years
£’000
Due in more
than 5 years
£’000
Bank loans 27,200 30,991 8,166 557 5,037 17,231
Trade and other payables 1,1711,1711,171 – – –
Credit risk
The group’s credit risk, that is the risk of financial loss due to a third party failing to discharge its obligation, primarily affects
its trade receivables. Creditworthiness of potential tenants is assessed before entering into contractual arrangements. The
amount of trade receivables presented in the balance sheet is calculated after any allowances for credit losses, estimated by
the directors. The allowance as at 31 December 2022 was £330,000 (2021 £392,000). The group’s maximum exposure to credit
risk is limited to the carrying amount of financial assets recognised at 31 December 2022 as summarised in the table above.
The group has no significant concentration of credit risk, with exposure spread over a number of tenants. The credit status
of tenants is continuously monitored and particularly reviewed before properties are acquired, before properties are let and
before new leases are granted.
The group’s cash holdings are mainly in Handelsbanken plc and Lloyds Bank plc. Cash is also held by the group’s property
managers, lawyers and registrars acting as agents, though not, other than for tenant deposits, for long periods of time. The
group only places cash holdings with major financial institutions that satisfy specific criteria.

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Capital risk
The directors manage the group’s working capital to take advantage of suitable commercial opportunities as they arise,
whilst maintaining a relatively low-cost capital base. This capital management policy is principally carried out by the use
of surplus cash. In the medium term, the directors may use additional medium-term debt to finance future commercial
property acquisitions in line with its long-term strategy.
Liquidity risk
The group’s liquidity risk, i.e. the risk that it might encounter difficulty in meeting its obligations as they fall due, applies to its
trade payables and any short and medium-term borrowings that the group takes out from time to time. The group has not
encountered any difficulty in paying its trade payables in good time. The objective of the group in managing liquidity risk is to
ensure that it can meet its financial obligations as and when they fall due. The group expects to meet its financial obligations
through operating cash flows.
Interest rate risk
The group finances its operations through retained profits and medium-term borrowings at an interest rate that is fixed over
the term of the loan. Interest rate swaps have not been used. The group places any cash balances on deposit at rates that may
be fixed in the short term but for sufficiently short periods that there is no need to hedge against the implied risk.
Currency exchange risk
The group is not directly exposed to currency risk.
Market risk
The group is not directly exposed to market risk.
Borrowing facilities
The group has no undrawn committed borrowing facilities.
19 Changes in liabilities arising from financing activities
Bank loans (Note 12)
2022
£’000
2021
£’000
At 1 January 27,200 27,200
Interest charged 840 850
Interest paid (840) (850)
At 31 December 27,200 27,200
20 Net assets per share
2022 2021
Net assets £56,176,000 £66,117,000
Ordinary shares in issue 5,194,963 5,183,699
Basic net assets per share 1,081p 1,275p
21 Post balance sheet events
On 8 February 2023, the group exchanged and completed on the sale of its Llantrisant asset that was classified as held for
sale at 31 December 2022. The gross sale proceeds were £7,850,000, £1,100,000 in excess of the valuation at 31 December 2022
and £899,000 in excess of cost.

114
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial statements
Company statement
of financial position
at 31 December 2022
Note
2022 2021
£’000 £’000 £’000 £’000
Fixed assets
Investments 5 50,663 60,418
Current assets
Debtors 6 966 2,597
Cash at bank 5,356 3,860
6,322 6,457
Creditors – amounts falling due within one year 7 809 758
Net current assets 5,513 5,699
Total assets less current liabilities 56,176 66,117
Net assets 56,176 66,117
Capital and reserves
Called-up share capital 8 1,299 1,296
Reserves
– Share-based payment 160 102
– Realised capital 8,728 8,728
– Other equity (207) (121)
– Share premium 226 117
– Capital redemption 95 95
– Revaluation 40,399 50,155
– Retained earnings 5,476 5,745
54,877 64,821
Shareholders’ funds 56,176 66,117
The company reported total (loss)/profit and comprehensive income for the financial year ended 31 December 2022 of
(£7,116,000) (2021 profit £11,944,000).
These financial statements were approved by the board of directors on 27 March 2023.
Paul Leaf-Wright Charles Butler
Director Director
Company number: 00224271
The accompanying notes form an integral part of these financial statements.

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Note
Share
capital
£’000
Share-
based
payment
reserve
£’000
Realised
capital
reserve
£’000
Other
equity
reserve
£’000
Share
premium
£’000
Capital
redemption
reserve
£’000
Revaluation
reserve
£’000
Retained
earnings
£’000
Total
£’000
At 1 January 2022 1,296 102 8,728 (121) 117 95 50,155 5,745 66,117
Profit for the year 2 – – – – – – – 2,640 2,640
Other comprehensive
income for the year 2 – – – – – – – (9,756) (9,756)
Dividends paid – – – – – – – (2,909) (2,909)
Revaluation loss of
subsidiaries – – – – – – (9,756) 9,756 –
Issue of shares 3 – – (112) 109 – – – –
Share award
expensed – 84 – – – – – – 84
Share award vested – (26) – 26 – – – – –
At 31 December 2022 1,299 160 8,728 (207) 226 95 40,399 5,476 56,176
Note
Share
capital
£’000
Share-
based
payment
reserve
£’000
Realised
capital
reserve
£’000
Other
equity
reserve
£’000
Share
premium
£’000
Capital
redemption
reserve
£’000
Revaluation
reserve
£’000
Retained
earnings
£’000
Total
£’000
At 1 January 2021 1,294 43 8,728 (53) 51 95 40,521 6,442 57,121
Profit for the year 2 – – – – – – – 2,310 2,310
Other comprehensive
income for the year 2 – – – – – – – 9,634 9,634
Dividends paid – – – – – – – (3,007) (3,007)
Revaluation gain of
subsidiaries – – – – – – 9,634 (9,634) –
Issue of shares 2 – – (68) 66 – – – –
Share award
expensed – 59 – – – – – – 59
At 31 December 2021 1,296 102 8,728 (121) 117 95 50,155 5,745 66,117
Company statement
of changes in equity
for the year ended 31 December 2022

116
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial statements
Notes to the company
financial statements
for the year ended 31 December 2022
1 Accounting policies
Basis of preparation
The financial statements have been prepared in accordance with applicable United Kingdom accounting standards,
including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the United Kingdom and
Republic of Ireland (FRS 102) and with the Companies Act 2006. The financial statements have been prepared under the
historical cost convention except for the modification to a fair value basis for certain financial instruments as specified
in the accounting policies below. The principal accounting policies of the company have remained unchanged from the
previous year.
These financial statements have been prepared on a going concern basis and in adopting the going concern basis the
directors have, based on the information available at the date of this report, considered the financial implications of the
conflict in Ukraine, the legacy impacts of the Covid-19 pandemic and the high inflation climate in the UK and the effect
of all of these on our stakeholders.
In preparing these financial statements, the following disclosure exemptions have been taken:
 The requirement to present a cashflow and related notes
 Financial instrument disclosures including:
− Categories of financial instruments;
− Items of income, expenses, gains or losses relating to financial instruments; and
− Exposure to, and management of, financial risks.
Dividend revenue
Dividend revenue is recognised in the statement of comprehensive income when the right to receive the payment
is established.
Share-based employee remuneration
Share-based employee remuneration is determined with reference to the fair value of the cash award that is used to
purchase the newly issued shares at the date at which the award is agreed and charged to the income statement over
the service and vesting period on a straight-line basis.
Interest income
Interest is recognised under the effective interest method.
Dividends payable
Dividend payments are dealt with when paid as a change of equity in retained earnings. Final dividends proposed are not
recognised as a liability.
Investments
Investments, being shares in subsidiary undertakings, are included at market value (net assets as shown by their financial
statements are taken as a reasonable estimate of market value as their assets and liabilities are carried at fair value).
The directors manage and evaluate performance on a fair value basis and, therefore, have designated qualifying financial
assets including shares in subsidiary undertakings at fair value through the profit and loss account.
Receivables
Trade receivables and other receivables that have fixed or determinable payments that are not quoted in an active market
are categorised as financial assets at amortised cost. These are measured at amortised cost using the effective interest rate
method, less any impairment. Discounting is omitted where the effect of discounting is immaterial.
Deferred tax
Deferred tax is recognised in respect of all timing differences at the reporting date. Deferred tax assets are recognised when it
is more likely than not that they will be recovered. Deferred tax is calculated using tax rates and laws that have been enacted
or substantively enacted by the reporting date. Deferred tax liabilities are presented within provisions for liabilities.

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Financial liabilities
The company’s financial liabilities include trade and other payables. Trade payables are recognised initially at fair value less
transaction costs and subsequently measured at amortised cost. A financial liability is derecognised when it is extinguished,
discharged, cancelled or expires.
Gains on disposals of assets
Gains on disposals of assets are the excess of net proceeds over the valuation at the beginning of the year. They are not
available for distribution under the company’s articles of association and are taken to realised capital reserve.
2 Company (loss)/profit for the year after tax
The company has not presented its own profit and loss account as permitted under section 408 of the Companies Act 2006.
The loss after tax for the year was (£7,116,000) (2021 profit £11,944,000). Information regarding directors’ remuneration appears
on pages 72 to 83 of this annual report.
3 Auditor’s fees
2022
£’000
2021
£’000
Fees payable to the company’s auditor for the audit of the group’s annual accounts
1
58 54
Fees payable to the company’s auditor for other services:
Audit-related assurance services 10 10
68 64
1 The audit fee for 2022 includes £11,710 (2021 £10,900) related to the completion of a group audit questionnaire for the Kingerlee Holdings
Limited’s auditor. This amount is recoverable in full from Kingerlee Holdings Limited and has been netted of other expenses.
4 Dividends
In 2022, the following dividends have been paid by the company:
2022
£’000
2021
£’000
2021 Final: 33p per ordinary share (2020 30p) 1,714 1,555
2021 Special: nil per ordinary share (2020 6p) – 311
2022 Interim: 23p per ordinary share (2021 22p) 1,195 1,141
2,909 3,007
On 27 March 2023, the directors declared a final property income distribution for 2022 of £1,714,000, 33p per share (2021 final
property income distribution of£1,714,000, 33p per share), payable on 2 June 2023 to shareholders registered on 21 April 2023.
5 Investments
Shares in
subsidiary
undertaking
£’000
Valuation at 1 January 2022 60,418
Loss on revaluation in excess of cost (9,756)
Valuation at 31 December 2022 50,663

118
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial statements
5 Investments continued
Equity investments are included at their market value. If investments had not been revalued, they would have been included
on the historical cost basis at the following amounts:
Shares in
subsidiary
undertaking
£’000
Cost at 31 December 2022 10,271
Cost at 31 December 2021 10,271
At 31 December 2022, the company held 100% of the following companies, which are all registered in England and Wales and
that all have the same registered office address as the company: Park Farm Technology Centre, Akeman Street, Kirtlington,
Oxon, OX5 3JQ.
Subsidiary Primary activity Immediate parent company Ownership
Rodenhurst Estates Limited Property investment Highcroft Investments PLC 100%
BL (Wisbech) Limited Holding company Rodenhurst Estates Limited 100%
Belgrave Land (Wisbech) Limited Property investment BL (Wisbech) Limited 100%
At 31 December 2022, the net assets and the (loss)/profit for the financial year of these subsidiaries were:
2022 2021
Net assets
£’000
(Loss)/profit
for the
financial year
£’000
Net assets
£’000
Profit for the
financial year
£’000
Rodenhurst Estates Limited 50,663 (6,756) 60,418 12,634
BL (Wisbech) Limited
1
––––
Belgrave Land (Wisbech) Limited 3,786 277 3,509 1,097
1 BL (Wisbech) Limited is a dormant intermediate holding company between Belgrave Land (Wisbech) Limited and Rodenhurst Estates
Limited. It holds the shares in Belgrave Land (Wisbech) Limited at cost.
6 Debtors
2022
£’000
2021
£’000
Owed by subsidiary undertakings 935 2,567
Other debtors 31 30
966 2,597
7 Creditors – amounts falling due within one year
2022
£’000
2021
£’000
Other taxes and social security 260 251
Other creditors 549 507
809 758
Notes to the company
financial statements
continued
for the year ended 31 December 2022

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8 Share capital
The movement in the number of 25p ordinary shares in issue is shown below:
2022 2021
Number £’000 Number £’000
At 1 January 5,183,699 1,296 5,175,175 1,294
Issued under the Highcroft Incentive Plan 11,264 3 8,524 2
At 31 December 5,194,963 1,299 5,183,699 1,296
9 Share premium
2022
£’000
2021
£’000
At 1 January 117 51
Issued under the Highcroft Incentive Plan 109 66
At 31 December 226 117
10 Capital commitments
There were no capital commitments at 31 December 2022 or at 31 December 2021.
11 Contingent liabilities
There were no contingent liabilities at 31 December 2022 or at 31 December 2021.
12 Related party transactions
Kingerlee Holdings Limited owns, through its subsidiaries, 27.4% (2021 27.2%) of the company’s shares, and David Kingerlee
(who was a director of the company until 1 August 2022, and a shareholder of the company throughout the year) and David
Warlow (who was appointed a director of the company on 1 August 2022) are both directors and shareholders of Kingerlee
Holdings Limited. The transactions between the group and Kingerlee Holdings Limited or its subsidiaries were as follows:
2022
£’000
2021
£’000
Property income distribution paid to related party 789 817
Recharge of Mazars fee for completion of group audit questionnaire 12 11
Licence fee for use of property and recharge of sundry costs paid to related party – 1
The company terminated its licence with Kingerlee Limited, a subsidiary of Kingerlee Holdings Limited, on 20 January 2021.
Under the provisions of section 33 FRS 102, transactions between Highcroft Investments PLC and its subsidiaries Rodenhurst
Estates Limited, BL (Wisbech) Limited and Belgrave Land (Wisbech) Limited are exempt from these disclosure requirements
as they are all wholly owned subsidiaries.
13 Employees
The employees of the group are all employees of the company and all their costs are incurred by the company as follows:
2022
£’000
2021
£’000
Remuneration 832 777
Pension costs 1 –
Social security costs 113 103
946 880

120
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial statements
List of definitions
Company voluntary arrangement (CVA): A procedure that allows a company to settle debts by paying only a proportion of
the amount that it owes to creditors.
Environmental, social and governance factors (ESG): Environmental criteria include the energy the company uses, the
waste it discharges, the resources it needs and the consequences for the world. They encompass greenhouse gas emissions
and climate change. Social criteria include the relationships that the company has with its broad range of stakeholders.
Governance is the internal system of controls, policies and procedures used to govern itself, make effective decisions, comply
with regulation and meet the needs of external stakeholders.
Estimated rental value (ERV): The rent at which the space could be let out in the market conditions prevailing at the date
ofvaluation.
European Single Electronic Format (ESEF): Companies on the London Stock Exchange’s main market are required to
comply with ESEF tagging requirements.
Financial Reporting Council (FRC): The regulator of auditors, accountants and actuaries and the setter of the UK’s Corporate
Governance Code and Stewardship Codes.
Fully repairing and insuring (FRI): An FRI lease is where the tenant has responsibility for all external and internal
maintenance, decorations and repairs as well as liability for insuring the building.
Interest cover ratio (ICR): The number of times net interest payable is covered by rental income of the secured properties.
Loan-to-value (LTV): Drawn debt divided by the fair value of the property portfolio. For bank facility purposes, the ‘fair value of
the property portfolio’ is replaced by the valuation included on valuation reports addressed to the bank.
Net debt: Borrowings plus bank overdraft less cash and cash equivalents.
Net initial yield: The initial gross income as a percentage of the market value plus standard costs of purchase.
Property income distribution (PID): Dividends from profits of the group’s tax-exempt property rental business under the
REIT regulations.
Real Estate Investment Trust (REIT): The UK REIT regime was launched on 1 January 2007. On 1 April 2008, Highcroft elected
to convert to REIT status. The REIT legislation was introduced to provide a structure that closely mirrors the tax outcomes
of direct ownership in property and removes tax inequalities between different real estate investors. It provides a liquid and
publicly available vehicle that opens the property market to a wide range of investors. A REIT is exempt from corporation tax
on qualifying income and gains of its property rental business providing various conditions are met. It remains subject to
corporation tax on non-exempt income and gains. Subject to concessions granted during the Covid-19 pandemic, REITs must
distribute at least 90% of their income profits from their tax-exempt property rental business, by way of dividend, known
as a property income distribution (PID). These distributions can be subject to withholding tax at 20%. If the REIT distributes
profits from the non-tax-exempt business, the distribution will be taxed as an ordinary dividend in the hands of the investors
(non-PID).
Return on equity: Total profit and comprehensive income divided by average total equity.
Reversionary yield: The yield that would be achieved if the passing rent adjusts to the level of the ERV.
Total shareholder return: The growth in the ordinary share price as quoted on the London Stock Exchange plus dividends
per share received for the year, expressed as a percentage of the share price at the beginning of the year.
UK Corporate Governance Code (the Code): The 2018 UK Corporate Governance Code.
Weighted average unexpired lease term (WAULT): The average lease term remaining to the first to occur on each lease of a
tenant break option, or lease expiry, across the portfolio, weighted by rental income.

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Group five-year summary (unaudited)
2022
£’000
2021
£’000
2020
£’000
2019
£’000
2018
£’000
Investment properties – at annual valuation 77,910 87,565 82,060 86,710 77,700
Equity investments – at market value – –––679
Total net assets 56,176 66,117 57,121 60,721 62,384
Net asset value per share in issue at end of each year 1,081p 1,275p 1,104p 1,175p 1,207p
Revenue (excluding gains/losses on
disposals of assets)
Gross income from property 5,608 5,928 6,084 5,840 5,043
Net admin expenses to gross rent 21.2% 19.6% 17.6% 14.1% 14.6%
Profit available for distribution 3,265 2,939 3,503 4,055 4,512
Share capital
Weighted average number in issue (000s) 5,192 5,184 5,172 5,167 5,167
Basic earnings per share (137.0p) 230.5p (22.2p) 22.3p 95.3p
Adjusted earnings per share 62.9p 56.7p 67.7p 78.5p 87.3p
Dividends payable per share 56.0p 55.0p 57.0p 48.0p 52.5p
FTSE 350 Real Estate Index 399 623 491 602 468
Highcroft year-end share price 930.0p 875.0p 720.0p 942.5p 885.0p

122
Highcroft Investments PLC Annual report and accounts for the year ended 31 December 2022
Financial statements
Directors and advisers
Company number
00224271
Directors
Charles Butler, BSc ACA
(Non-executive chairman)
Simon Costa, BSSc MA MPhil
(Non-executive)
Simon Gill, BSc FRICS
(Chief executive to 31 December 2022
then executive director)
David Kingerlee, resigned 1 August 2022
(Non-executive)
Paul Leaf-Wright, B Compt (Hons) SA
appointed 1 January 2023
(Chief executive)
Roberta Miles, MA FCA
(Finance director)
David Warlow, appointed 1 August 2022
(Non-executive)
Company secretary
Anne-Marie Palmer, LLB FCG
Registered office and
business address
Park Farm Technology Centre
Akeman Street
Kirtlington
Oxon
OX5 3JQ
United Kingdom
Independent auditor
Mazars LLP
Statutory Auditor
Chartered Accountants
30 Old Bailey
London
EC4M 7AUF
Independent valuer
Knight Frank LLP
55 Baker Street
London
W1U 8AN
Bankers
Handelsbanken plc
Latimer House
Langford Locks
Kidlington
Oxon
OX5 1GG
and
Lloyds Bank plc
Ground Floor
Canons House
Canons Way
Bristol
BS1 5LL
Solicitors
Clarkslegal LLP
5th Floor
Thames Tower
Station Road
Reading
RG1 1LX
and
Charles Russell Speechly LLP
5 Fleet Place
London
EC4M 7RD
Property managing
agent
Workman LLP
Alliance House
12 Caxton Street
London
SW1H 0QS
Corporate finance
advisers
Singer Capital Markets Advisory LLP
One Bartholomew Lane
London
EC2N 2AX
Registrars
Link Group
Central Square
PXS 1
29 Wellington Street
Leeds
LS1 4DL
Tax advisers
Grant Thornton UK LLP
30 Finsbury Square
London
EC2A 1AG
Property asset
managers
Cube Asset Management Limited
113a Jermyn Street
London
SW1Y 6HJ

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The production of this report supports the work of the Woodland
Trust, the UK’s leading woodland conservation charity. Each tree
planted will grow into a vital carbon store, helping to reduce
environmental impact as well as creating natural havens for wildlife
and people.

Park Farm Technology Centre
Akeman Street
Kirtlington
Oxon
OX5 3JQ