JPIMEDIA PUBLISHING LIMITED Annual Report and Financial Statements for the 52 Week Period 5 January 2020 to 2 January 2021

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JPIMEDIA PUBLISHING LIMITED Annual Report and Financial Statements for the 52 week period 5 January 2020 to 2 January 2021

Registered number: 11499982

JPIMEDIA PUBLISHING GROUP

ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

Company Information 2

Strategic Report 3

Directors’ Report 11

Independent Auditors’ Report 14

Consolidated Income Statement 16

Consolidated Statement of Comprehensive Income 17

Consolidated Statement of Financial Position 18

Consolidated Statement of Changes in Equity 19

Consolidated Cash Flow Statement 20

Notes to the Consolidated Financial Statements 21

Company Income Statement 51

Company Statement of Comprehensive Income 52

Company Balance Sheet 53

Company Statement of Changes in Equity 55

Notes to the Company Financial Statements 56

JPIMEDIA PUBLISHING GROUP

COMPANY INFORMATION FOR THE PERIOD ENDED 2 JANUARY 2021

Chairman David Montgomery

Directors D J Montgomery V L Vaghela

Registered Office 9th Floor 107 Cheapside London England EC2V 6DN

Company Secretary OHS Secretaries Limited

Solicitors MacRoberts LLP Capella 60 York Street Glasgow United Kingdom G2 8JX

Orrick Herrington & Sutcliffe (UK) LLP 107 Cheapside London United Kingdom EC2V 6DN

Bankers Barclays Bank PLC 27 Soho Square Soho London United Kingdom W1D 3QR

Independent Auditors Crowe U.K. LLP 55 Ludgate Hill London United Kingdom EC4M 7JW

JPIMEDIA PUBLISHING GROUP

STRATEGIC REPORT FOR THE PERIOD ENDED 2 JANUARY 2021

The Directors present their Strategic Report, the Directors’ report and the Audited Financial Statements for the Group, comprising JPIMedia Publishing Limited (the “Company”) and its subsidiaries (“the Group”), for the 52 week period ended 2 January 2021 (‘2020’). On 2 January 2021, the Company was acquired by National World plc (“National World”), which is described further below.

Adjusted results are presented for a comparable period of 52 weeks for 2020 and 2019 to provide additional clarity and understanding of the Group’s underlying trading. Adjusted results exclude non-recurring items and for 2019 are presented for the 52 weeks ended 4 January 2020 to provide a more meaningful comparison of year on year trends. A reconciliation between statutory and adjusted results is shown in Note 29.

Activities and business review

The Group is one of the largest regional and local multimedia publishers in the United Kingdom providing information services to communities through a portfolio of 135 publications and websites. The Group’s portfolio includes iconic titles such as The Scotsman, The Yorkshire Post, Belfast News Letter, Sheffield Star, Edinburgh Evening News, Portsmouth News and Lancashire Evening Post. The principal activities of the Group are to meet the wide-ranging news and information needs of numerous local communities across the United Kingdom. The Group operates a portfolio of print and digital publications providing advertisers with a range of market access and readers with trusted local content.

On 2 January 2021, the Group was acquired by National World plc from JPIMedia Limited. The Group’s accounts have not been consolidated into the annual financial statements of National World as National World’s accounts for 2020 are prepared for the year ended 31 December 2020 and therefore the acquisition was post their year end. The results of the Group will be included in the consolidated financial statements of National World in future periods.

Strategy and future outlook

The Group’s strategy to build a growing digital business whilst continuing to enhance its print publications, which remain structurally challenged, was adversely impacted on the onset of the COVID-19 pandemic from March 2020. The focus during 2020 was to centralise the majority of operations to drive efficiencies and, with limited locally managed resources, to manage the core daily newspaper titles and related websites and several core weekly newspaper titles. Although trading conditions were more challenging, progress continued on the delivery of its strategy with: • the continuation of the Digital transformation project focused on digital first content creation and relevant, timely and local content for its consumers; • continued investment in upgrading website platforms to enhance the user experience; and • the roll out of subscriptions across 13 websites offering consumers a seamless choice of web, mobile and app subscription packages; and • investment in its data analysis capabilities across all areas of the business.

Going forward National World will drive performance across the Group to deliver its vision:

“To create a modern platform for news publishing through the implementation of a new operating model across multiple brands and platforms by acquiring a number of media and digital technology assets, and leveraging its portfolio to launch new media brands across the UK.”

The key pillars of transformation to deliver the strategy vision are to “localise, energise, digitise and monetise” relevant and unique content: • Localise – Our publishing assets provide compelling content for local communities; both consumers and businesses. A greater sense of community awareness has also been generated during the COVID-19 pandemic as more consumers have lived their lives in a smaller locale. With this new spirit of localism, we will ensure our journalists and commercial teams are more connected with the local communities they serve. • Energise – Energise our products and services to enhance user experience and engagement and provide a strong platform to leverage our unique quality content to launch new products and services across multiple platforms. While our print news-brands will be managed creatively and profitably, our strategic focus is on growing local, regional and national online audiences who are deeply engaged with our content. • Digitise – Enhance the digital infrastructure to improve responsiveness, engagement, data analytics, AI content generation and user insights. • Monetise – Create enhanced first party data and use the latest available digital technology to more effectively define audiences to drive multiple digital revenue streams: digital display advertising - targeting growth in higher yielding video content and local digital advertising, digital subscription - targeting both consumers and businesses and e-commerce - focusing on specific categories of content.

Further details on the National World strategy are provided in the Annual Report and Accounts of National World for the year ended 31 December 2020.

To monitor progress the Board will assess the appropriate KPIs which will be actively monitored and reported and will cover:

• Digital audience - including unique users, page views and registrations; • Digital revenue - Build through the key categories of display, subscriptions, video and e-commerce; • Revenue trends - Management are intent on developing a model to improve revenue trends with KPIs that monitor a transition from dependency on print sales to an accelerating digital performance; and • Cash generation and financial flexibility - To provide headroom for investment and the return of capital to National World through either repayment of inter-company loans or dividends. Management are keen ensure financial flexibility will be a key KPI.

During the first half of 2021 the Board is focused on stabilising and establishing the appropriate organisation structure of the Group and will present detailed KPIs for monitoring our performance in the 2021 results.

JPIMEDIA PUBLISHING GROUP

STRATEGIC REPORT FOR THE PERIOD ENDED 2 JANUARY 2021

The Group employs experienced and professional journalists and adheres to the highest standards in producing trusted content. Trusted local content is key to our consumers in a world with a proliferation of information sources. The Group is actively marketing its trusted, local products to its consumers and differentiating itself from other information sources. A full list of titles, which provide essential reading to communities across the United Kingdom is available online via the JPIMedia website: https://www.jpimedia.co.uk/newsbrands/

Employees

The commitment, creativity and drive of our employees are core to the transformation and success of the business and our people have performed exceptionally well during a year of intense challenge due to the COVID-19 pandemic.

The pressure of working under lockdown restrictions have provided a challenging background, however, our journalists have adapted and worked extremely hard to continue to deliver outstanding journalism to their local communities. Our commercial and support staff have also adapted, with remarkable resilience delivering customer needs and campaigns to those who could continue to market their business.

The health and wellbeing of our employees has been a huge focus for us, in particular with the onset of the COVID-19 pandemic. We have developed a platform of supported material including: virtual classroom learning for our management teams to help with supporting their teams with remote working and one to one coaching to develop interventions and coping strategies for those employees whose mental health has been affected. We have introduced pulse surveys to analyse our employees’ thoughts and feelings and as a follow up to the survey we developed communication channels to encourage our employees to engage with our Mental Health First Aiders and HR professionals.

Principal risks and uncertainties

The principal risks have been revised, following the acquisition of JPIMedia Publishing Limited by National World on 2 January 2021, with a few combined into Strategy, and a number of the risks no longer being applicable. The key principal risks are summarised below:

• Strategy

The news publishing sector continues to face ongoing challenges with newspaper circulation volume and print advertising in structural decline, increased competition in local markets with the launch of new online news sites and the dominance of Google and Facebook impacting the monetisation of digital websites through advertising and the multiple sources of news online impacting the growth of subscription and e-commerce revenue. The Board has a clear strategy and a very experienced management team that is highly motivated to deliver against the strategy. The Board is fully engaged on the operating performance of the business and regular updates are provided to the Board on strategic initiatives.

• COVID-19

COVID-19 continues to impact the UK economy and the Group’s trading post acquisition. The Directors are closely monitoring the commercial impact of the COVID-19 pandemic on the Group, the wider news publishing sector and the implications for the UK economy. The Group maintains significant financial flexibility considering the uncertain trading outlook and management are already taking steps to mitigate any future implications on revenues and profits.

• Infrastructure and operations

The Group is reliant on an effective and efficient infrastructure to support its operations. This includes a robust: IT Infrastructure, regulatory compliance framework, financial control environment and contracts with suppliers, in particular for our websites and printing of our newspapers. The Group has established a risk management framework which is overseen by the Risk Management Committee and is chaired by the Executive Chairman and includes senior management representing all operations across the Group. The first meeting of the Risk Management Committee was held during March 2021.

• Cyber-security

The Group is at risk of a cyber attack on systems and websites. In-line with industry best-practice, multiple layers of security systems are in- place. These include managed firewalls, anti-virus software, single-sign-on, ransomware protection and a managed email platform that has a number of sophisticated security configurations built-in. The principal news websites are hosted independently of the main IT infrastructure on Amazon Web Services under the management of a third-party vendor. An insurance policy is in-place that provides cover for cyber-security related issues. The change advisory board regularly review the internal risk register and update accordingly in response to any identified issues.

• Loss of key senior management

The Group’s performance could be adversely impacted by the loss of key senior management. The Remuneration Committee of National World will regularly review and ensure that adequate incentive schemes are in place for executive and senior management. The Board also intend to, at least annually, review succession planning to ensure there are appropriate plans in place to minimise disruption to operations arising from the loss of key personnel.

Operational review

Grow subscriber digital revenue

Digital subscriptions revenue grew by 260% period-on-period from £0.2 million to £0.8 million. The Group has paywalls on 13 of its websites at the end of 2020, compared to five for the prior period-end. Digital subscriber numbers have grown by 280% year-on-year to over 13,000 subscribers at the end of the reporting period.

JPIMEDIA PUBLISHING GROUP

STRATEGIC REPORT FOR THE PERIOD ENDED 2 JANUARY 2021

Grow advertising digital revenue

Digital advertising revenue performance varied across individual categories. Digital revenue was 8% down year on year in Quarter 1, before the lockdown impact in Quarter 2 with performance 40% down year on year, finishing the full year 19% down on the prior year. Many advertisers were cautious during this time and some customers closed their businesses during lockdown. National digital grew by 32% year-on-year, largely from government revenue and programmatic revenue driven by higher page views. Local display and the classified verticals suffered from lockdowns across the country, down 44% and 57% year-on-year respectively. Local display was predominantly packaged with local print display and therefore the fall in print advertising impacted digital sales. Excluding digital revenue packaged with print, digital revenue fell by 10%.

A key focus for the future will be to build digital revenue that is not driven by upsell from print. Therefore, for future periods digital revenue that is upsold from print will be reported as print revenue. If this change was adopted for 2020, reported adjusted digital revenue would be £9.3 million representing year on year growth of 9.6%.

Print advertising

As a result of COVID-19 print advertising revenue fell £15.7m (36%) year on year. Print advertising was down 15% year on year for January and February 2020 and this increased to a decline of 24% year on year in Quarter 1 with a national lockdown imposed during March 2020. Print advertising fell by 52% year on year in Quarter 2 before improving in the second half to finish 36% down on the prior year. The main categories affected are local display (55%) and classified advertising (64%). There has been a strong improvement in national display advertising (+30%) due to additional Government spend for COVID-19 related campaigns. Total COVID-19 related Government spend was £2.6 million in 2020. This includes £0.2 million from the Scottish, Welsh and Northern Ireland devolved governments.

Circulation revenues

Whilst circulation volumes and revenue were severely impacted in the immediate aftermath of the COVID-19 lockdown period, performance has improved marginally as the year progressed. A programme of enhancing our content with an increased focus on local unique content will help support sales volumes and revenue trends in 2021.

Prior to the impact of COVID-19, Circulation revenue was 13% down year on year in Quarter 1 deteriorating to 23% down year on year in Quarter 2, with improvements seen as lockdowns were lifted to finish the full year 18% down on the prior year.

No cover prices increases were implemented in 2020 after the first lockdown announcement. The Group worked with local councils and other organisations in some local communities, to ensure that copies of newspapers were included with food parcels, to allow readers to keep in touch with the news in their local area.

Nationally the Group distributed 43.5 million paid for copies and 6.0 million free copies. Total distribution of 49.5 million copies is down 29% year-on- year from 70.1 million copies, including free copies. Free copy distribution is down 8.7 million copies year-on-year, due to some titles being suspended during the pandemic. During 2020, the average decline in volumes for daily and weekly paid for newspapers was 21% and 23% respectively. Whilst volumes trends have been adversely impacted by the COVID-19 pandemic, the Group maintains significant reach with 3.7 million paid for copies sold in December 2020.

Cost management

Statutory operating costs before depreciation and amortisation fell £36.5 million compared to the prior period, primarily due to the impact of the COVID- 19 pandemic. On an adjusted basis, operating costs fell £22.5 million (21.8%) year on year due to reduced print volumes resulting in direct cost savings of 33%, with lower pagination, and printing of some free titles suspended during national lockdown periods and cost savings driven by restructuring across the Group as a result of the lower revenue. The Group also benefitted from property rates holidays, offered by local councils, and other savings due to office closures.

The Group participated in the Government furlough scheme and received total grants of £3.9 million during the year to mitigate staff costs for employees on furlough. £3.5 million of furlough claimed related to the Group and is credited to Group operating costs, the remaining £0.4 million claim related to the print business (sold to dmg media Limited on 17 October 2020) which was not part of the Group and therefore is not reported in the Consolidated Group Income Statement.

The implementation of IFRS 16 has resulted in the reclassification of operating lease costs as depreciation and finance costs, reducing operating costs before depreciation and amortisation in the current period by £1.6 million compared to the prior period.

Operating loss and EBITDA

Statutory operating loss of £33.0 million in the period, includes a £24.5 million impairment charge on the Group’s publishing titles and other non- recurring costs, compared to a loss of £19.3 million in the prior period. The adjusted operating loss of £1.9 million reported for the period, compared to a profit of £5.1 million in the prior period, with the decline primarily due to the impact of the COVID-19 pandemic. A reconciliation between statutory and adjusted results is shown in Note 29. EBITDA of £1.1 million for the period compares to EBITDA of £3.5 million for 2019. The adjusted EBITDA for the period is £7.7 million, compared to £13.4 million for 2019. Adjusted EBITDA for 2020 before the implementation of IFRS16 is £6.1 million.

JPIMEDIA PUBLISHING GROUP

STRATEGIC REPORT FOR THE PERIOD ENDED 2 JANUARY 2021

Financial review Introduction This Financial review provides commentary on the Group’s statutory and adjusted results for the 52 week period ended 2 January 2021 (2019: 74 weeks to 4 January 2020 of which 15 weeks were non-trading weeks).

Basis of presentation of results Adjusted results are presented for a comparable period of 52 weeks for 2020 and 2019 to provide additional clarity and understanding of the Group’s underlying trading. Adjusted results exclude non-recurring items and for 2019 are presented for the 52 weeks ended 4 January 2020 to provide a more meaningful comparison of year on year trends. A reconciliation between statutory and adjusted results is shown in Note 29.

INCOME STATEMENT

Statutory results Adjusted results 1

52 weeks to 74 weeks to 52 weeks to 52 weeks to 2 January 4 January 2 January 4 January 2021 2020 Change Change 2021 2020 Change Change £m £m £m % £m £m £m %

Print Publishing Revenue 68.8 105.4 (36.6) (34.7%) 68.8 93.7 (24.9) (26.6%)

Advertising 28.1 49.3 (21.2) (43.0%) 28.1 43.8 (15.7) (35.8%) Circulation 37.9 52.2 (14.3) (27.4%) 37.9 46.2 (8.3) (18.0%)

Other 2.8 3.9 (1.1) (28.6%) 2.8 3.7 (0.9) (24.3%)

Digital Publishing Revenue 17.9 24.2 (6.3) (26.0%) 17.9 21.3 (3.4) (16.0%)

Advertising 16.4 23.0 (6.6) (28.7%) 16.4 20.3 (3.9) (19.2%)

Subscriptions 0.8 0.2 0.6 300.0% 0.8 0.2 0.6 300.0%

Other 0.7 1.0 (0.3) (30.0%) 0.7 0.8 (0.1) (12.5%)

Other revenue 1.5 1.4 0.1 7.1% 1.5 1.4 0.1 7.1% Total Revenue 88.2 131.0 (42.8) (32.7%) 88.2 116.4 (28.2) (24.2%) Operating Costs (80.5) (117.0) 36.5 31.2% (80.5) (103.0) 22.5 21.8% Depreciation and Amortisation (9.6) (8.3) (1.3) (15.7%) (9.6) (8.3) (1.3) (15.7%)

Operating (loss)/profit pre non- (1.9) 5.7 (7.6) (133.2%) (1.9) 5.1 (7.0) (137.3%) recurring items Non-recurring items: Restructuring (3.5) (5.4) 1.9 35.2% - - - - Impairment of intangible assets (24.5) (14.5) (10.0) (69.0%) Other (3.1) (5.1) 2.0 39.2% - - - -

Operating (loss)/profit (33.0) (19.3) (13.7) (71.2%) (1.9) 5.1 (7.0) (137.3%) Operating (loss)/profit margin % (37.4%) (14.7%) (22.7%) (2.2%) 4.4% (6.5%)

Financing Net finance income/(expense) 2 (0.2) 0.1 (0.3) 300.0% Loss before tax (33.2) (19.2) (14.0) (73.1%) Tax credit 2.1 1.5 0.6 (40.0%)

Loss after tax (31.1) (17.7) (13.4) (75.9%) EBITDA 1.1 3.5 (2.4) (68.8%) 7.7 13.4 (5.7) (42.5%) EBITDA margin % 1.2% 2.7% (1.4%) 8.7% 11.5% (2.8%)

1 Adjusted results include the effect of IFRS 16 for both periods, and excludes non-recurring items (including impairment). 2 Rounding applied, refer to Statutory Income Statement.

JPIMEDIA PUBLISHING GROUP

STRATEGIC REPORT FOR THE PERIOD ENDED 2 JANUARY 2021

Revenue

Statutory revenue fell 32.7% on the prior period, with the impact of the COVID-19 pandemic and additional trading weeks in the prior period contributing to the decline. Adjusted revenue fell 24.2% year-on-year, with trends materially impacted by COVID-19 pandemic from the middle of March 2020. For the first two months of 2020, adjusted revenue was down 11% year on year.

Print revenue

Statutory print revenue was down 34.7% on the prior period. Adjusted print revenue in 2020 was £68.8 million, a decline of 26.6% year on year (2019: £93.7 million) reflecting the impact of COVID-19 which resulted in national and local lockdowns across the UK and the continuing impact of structural shift of advertising spend to digital.

Statutory circulation revenue fell 27.4% on the prior period. Adjusted circulation revenue was £37.9 million (2019: £46.2 million) in the period. Newspaper sales volumes declined during the period, with the resulting revenue decline partially offset by cover price increases. During 2020, the average decline in volumes for daily and weekly paid for newspapers was 21% and 23% respectively. Whilst volumes trends have been adversely impacted by the COVID-19 pandemic, the Group maintains significant reach with 3.7 million newspapers sold in December 2020.

Whilst circulation volumes and revenue were most severely impacted in the immediate COVID-19 lockdown period, performance has improved marginally as the year progressed and a programme of enhancing our content with an increased focus on local unique content will help support sales volumes and revenue trends in 2021.

The impact of COVID-19 was particularly pronounced in the Local Display and Classified advertising category (Employment, Property and Motors). National revenue grew, benefiting from government advertising during the pandemic.

Digital

Statutory digital revenue was 26.0% down on the prior period. Adjusted digital revenue in 2020 was £17.9 million, a decline of 16.0% year on year (2019: £21.3 million) reflecting the impact of COVID-19. Digital advertising performance was varied across individual categories. Local display and the classified verticals suffered from lockdowns across the country with many advertisers cautious during this time and some customers closed their businesses during the period. National digital grew largely from government revenue and programmatic revenue driven by higher page views with average monthly pages of 130 million in 2020, reflecting a year on increase of 15%.

Subscriber digital revenue grew 300% from £0.2 million to £0.8 million year on year, following the launch of paywalls across 13 sites and the continued evolution of the subscription propositions.

Operating loss

The Group’s statutory operating loss, including non-recurring items, is £33.0 million (2019: £19.3 million loss). The 2020 statutory loss is impacted by the more challenging trading during 2020 as a result of COVID-19 and resultant acceleration in structural change impacting the Group’s newspaper titles. Non-recurring items include the impairment of Intangible publishing rights and titles of £24.5 million (2019: £14.5 million impairment of goodwill and publishing rights and titles), restructuring costs of £3.5 million (2019: £5.4 million), derecognition of restricted cash payable to former vendors £1.5 million (2019: £Nil) and other non-recurring charges of £1.6 million (2019: £5.1 million).

A £1.9 million adjusted operating loss for the period (2019: £5.1 million profit) reflects the material impact of COVID-19 over the last year which contributed to a revenue decline of £28.2 million partly mitigated by £22.5 million of cost savings across the business. The operating costs are also after the benefit of £3.5 million of Government furlough grants.

The 2020 results include the impact of the application of the change in the leasing accounting standard IFRS16. Depreciation and amortisation includes £1.4 million expense relating to Right-of-Use assets (“ROUA”) in the current period. The prior period adjusted depreciation and amortisation expense includes £0.6 million of expense relating to Right of Use assets, offset by the removal of £0.6 million of amortisation relating to the 2018 trading period. The lower ROUA expense for the prior period is due to agreements for the majority Group’s leased properties being negotiated in late 2019, following the Administration in late 2018 and end of the license to occupy agreements. Note 28 provides further details on the impact of IFRS 16 changes.

EBITDA

EBITDA for 2020 is £1.1 million (2019: £3.5 million), while adjusted EBITDA is £7.7 million for the period (2019: £13.4 million). The deterioration in 2020 reflects the material impact of COVID-19 over the last year which contributed to a revenue decline of £28.2 million partly mitigated by £22.5 million of cost savings achieved from across the business.

Loss before tax The statutory loss before tax of £33.2 million (2019: £19.2 million loss) is after non-recurring charges of £31.1 million and finance costs of £0.3 million, which arise from the implementation of IFRS16 lease accounting for 2020.

Loss after tax The statutory loss after tax of £31.1 million (2019: £17.7 million loss) is after a £2.1 million tax credit arising from a reduction in the deferred tax liability held following the impairment of unregistered publishing titles in the period.

JPIMEDIA PUBLISHING GROUP

STRATEGIC REPORT FOR THE PERIOD ENDED 2 JANUARY 2021

BALANCE SHEET 2020 2019 Movement

£m £m £m Non-current assets 16.1 44.6 (28.5) Current assets 13.2 44.9 (31.7) Total assets 29.3 89.5 (60.2) Current liabilities (19.8) (104.6) 84.8 Non-current liabilities (2.3) (2.6) 0.3 Total liabilities (22.1) (107.2) 85.1

Net assets 7.2 (17.7) 24.9

Equity 7.2 (17.7) 24.9

Non-current assets

Non-current assets fell by £28.5 million due to the publishing titles impairment of £24.5 million and £3.2 million amortisation charge on publishing titles and rights in the period (Note 11). Right of use assets of £3.2 million are included in non-current assets on the Statement of Financial position, following the adoption of IFRS16.

Current assets

The fall in current assets of £31.7 million is primarily due to a fall in cash balances of £18.6 million and the full recovery of £8.8 million of amounts receivable from the former parent, JPIMedia Limited. The remainder of the fall in current assets arose due to the reduction in revenue.

The Group generated cash from operating activities of £6.8 million (2019: £24.9 million). The Group held cash of £0.5 million on 2 January 2021 (4 January 2020: £19.1 million). The reduction in cash at 2 January 2021 was due to the repayment of outstanding debt to the former parent, JPIMedia Limited, prior to the acquisition of the Company by National World.

Current Liabilities

Current liabilities fell by £84.8 million predominantly due to the repayment of amounts due to the former parent, JPIMedia Limited and the capitalisation of £56.0 million of debt due to the former parent company through the issue of 1,000 ordinary shares at a nominal value of £0.01 per share.

A lease liability of £1.4 million is included in current liabilities on the Statement of Financial position, following the adoption of IFRS16.

Non-current Liabilities

Non-current liabilities reduction of £0.3 million reflects the release of £2.1 million deferred tax relating to intangible assets that were impaired in the period, partially offset by a lease liability of £1.8 million, following the adoption of IFRS16.

Net assets

On 2 January 2021, the Group had net assets of £7.2 million (2019: net liabilities £17.7 million). The increase in net assets is primarily due to the capitalisation of intercompany payables due to the former parent company of £56.0 million, partially offset by losses of £31.1 million for 2020, which includes the impairment of publishing title intangible assets of £24.5 million. Subsequent to the acquisition by National World on 2 January 2021, National World provided additional cash funding of £10.5 million to the Group to enable the Group to repay the former parent company £4.7 million of outstanding intercompany debt and £5.8 million of working capital to meet day-to-day liquidity to fund the Group’s operations.

Going Concern

The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future.

The Directors have assessed the impact of the following key factors and mitigating actions in assessing going concern:

● The COVID-19 pandemic has been a rapidly evolving situation since the initial declaration of a Health Emergency by the World Health Organisation on 30 January 2020. This has resulted in and continues to provide a high level of uncertainty nationally and internationally and has had a significant impact on the trading operations and results of the Group. The successful development and rollout of COVID- 19 vaccines in the UK has provided a more positive outlook, but this is dependent on the continued success of the vaccination programme. ● The repeated lockdowns have required many of our employees to work remotely from home. Revised working protocols remain in place and we are not reliant on any critical suppliers that cannot operate as a result of COVID-19. ● Advertising and circulation revenues have been adversely impacted as a result of the pandemic and ongoing structural change facing print media. The Group has taken and continues to take appropriate cost reduction measures, including use of the UK Government's furlough scheme for employees.

JPIMEDIA PUBLISHING GROUP

STRATEGIC REPORT FOR THE PERIOD ENDED 2 JANUARY 2021

● Although revenue remains under pressure as a result of COVID-19, along with pressures on the sector more generally, consistent with the UK macroeconomic position we expect an improvement in revenues as lockdown restrictions ease. ● The Group regularly monitors its cash flow requirements to ensure it has sufficient cash to meet its financial obligations. The strong financial position of the parent company, National World, and its financial support for the Group would mitigate the impact of adverse trading conditions impacting financial headroom.

Whilst there remains uncertainty in the economic outlook and the overall impact of the COVID-19 pandemic, the Directors are satisfied it does not impact the Company's or Group's going concern position and has the financial support from its immediate parent, National World. Accordingly, the financial statements have been prepared on a going concern basis.

Corporate Responsibility

Section 172 statement As required by section 172 of the UK Companies Act, a director of a company must act in the way they consider, in good faith, would most likely promote the success of the company for the benefit of its shareholders. In doing this, the director must have regard, amongst other matters, to the: • likely consequences of any decisions in the long term; • interests of the company’s employees; • need to foster the company’s business relationships with suppliers, customers and others; • impact of the company’s operations on the community and environment; • company’s reputation for high standards of business conduct; and • need to act fairly as between members of the company.

The Board endeavours to communicate effectively with all its stakeholders. The key stakeholders of the Group are its employees, customers, suppliers, shareholders and local communities. The Board seeks to understand their views, and also act fairly between different members.

The Group aims to conduct its business with integrity, honesty and in accordance with ethical standards. We seek to maintain the highest standards of quality whilst operating as efficiently as possible. These principles are contained in the Group’s Code of Ethics and a range of related policies which are reviewed annually and for which compliance is monitored. The Board is responsible for the Group’s ethical standards and ensuring compliance with and implementation of these principles, with day to day responsibility for communication of and adherence being delegated to managers. Any breach, or suspected breach, of the Code of Ethics is reported to senior management and disciplinary action will be applied for any breach of the Code of Ethics.

Employees We respect the rights and interests of our employees and value diversity in our workforce. We encourage mutual trust and respect between all employees and strive to promote and protect a culture where each employee knows the value of their contribution to the Group as a whole. We are committed to helping employees maximise their potential through the development of skills and knowledge and we seek to implement policies that encourage and reward productivity, creativity and loyalty. We recruit, employ and promote employees solely on the basis of qualifications, performance and abilities and without discrimination. We are committed to providing our employees with a safe and healthy working environment. We do not tolerate any form of discrimination, harassment, victimisation or bullying and there are clear policies and procedures in place to deal with such behaviour.

The Group provides a competitive range of benefits to employees, including the opportunity to join the defined contribution pension scheme. Other benefits such as duvet days and the embracing of agile and home working provides employees with greater flexibility in their work-life balance. The Group continues to offer career progression to its employees and equips them with the right skills to operate in a digital landscape through online learning, virtual classrooms, action learning sets and supported coaching. We embrace apprenticeship programmes to widen the talent pipeline in a bid to attract people from diverse backgrounds and will continue to do so for the foreseeable future.

Consultation with employees, their representatives, and our Unions takes place at all levels. We have developed a JPIMedia Intranet to provide an easy reach platform and boost our communications. Our regular meetings with the Unions encourages collaborative communication with the aim of taking the views of employees into account, within the limitations of commercial confidentiality, when decisions are taken that will likely affect their interests.

In addition, the Group has clear processes and policies with regard to disciplinary procedures, whistleblowing, safeguarding of children and young people and management of employee data.

Customers Our newspapers and internet sites are produced by local teams of people, dedicated to delivering local news and information. We are committed to providing our customers with accurate, honest and informative products that reflect the important issues in the communities that our titles serve, thus encouraging a loyal and valuable readership and regular use of our internet sites. The Group is wholly committed to the Independent Press Standards Organisation (IPSO) and the Editorial Code of Conduct. Along with the overwhelming majority of publishers in the UK, we remain committed to our membership of IPSO which regulates our journalism and enforces the Editors’ Code of Practice. Pursuant to our obligations, we submit an Annual Statement to IPSO, which is published on its website. The Statement sets out our record on editorial compliance during the previous year (including details of complaints upheld against us), our protocols for maintaining editorial standards, our complaints handling process and our training programmes for journalists.

JPIMEDIA PUBLISHING GROUP

STRATEGIC REPORT FOR THE PERIOD ENDED 2 JANUARY 2021

Suppliers Our suppliers are essential to our business and we are committed to maintaining good working relationships with suppliers whilst maintaining the value of these relationships for the benefit of the Group.

Shareholders We seek to provide our shareholders with an attractive long term return on their investment in National World. We recognise the value of an honest and open relationship with our shareholders and our dealings with them are conducted in accordance with recognised standards of responsible corporate governance.

Community We work hard to nurture the trust and loyalty our customers place in us and are proud of the role our titles continue to play in our communities. Through fund-raising and awareness initiatives, sponsorship, hard-hitting campaigns, awards ceremonies to recognise and support local businesses, and an unfailing dedication to providing the latest news, features, sport and entertainment, our newspapers and websites remain at the heart of the communities we serve. Whilst 2020 saw many events cancelled due to the COVID-19 pandemic, we are pleased to have a number of events scheduled for 2021 including awards ceremonies aimed at excellence in local business and regional apprenticeships.

Anti-corruption and bribery The Group takes a zero tolerance approach to bribery and corruption and is committed to acting professionally, fairly and with integrity in all our business dealings and relationships wherever we operate and implementing and enforcing effective systems to counter bribery. The Group has an Anti-Corruption and Bribery policy which is applicable to all employees across the Group.

Equality and diversity The Group is an equal opportunity employer and has policies in place that safeguard the wellbeing and welfare of all employees. The Group also recognises the importance of promoting diversity and this is reflected in our policies. The Group will not discriminate on grounds of sex, pregnancy, transgender status, sexual orientation, religion or belief, marital status, civil partnership status, race, colour, nationality, national or ethnic origins, disability or age, or any other grounds. This principle extends to all matters relating to all aspects of employment, including recruitment and selection, performance reviews, assessment for promotion, disciplinary action, training, pay and benefits. During the year we have increased focus on the creation of a more inclusive recruitment process, complemented by online learning to raise awareness of unconscious bias. In addition, the Group reduces potential exposure through communicating policies to all employees, promoting awareness during recruitment, training managers and making policies accessible to all via the Group intranet.

Modern slavery The Group believes it has a minimal exposure to the risks related to human rights but is committed to respecting human rights across all its operations and fully supports the Modern Slavery Act 2015. We protect the human rights of our employees through ensuring all employees are issued with clear contracts of employment, that working hours as standard are set well within the working time directive maximum thresholds and committing that no employee will be forced to opt out of working time regulations. Our employees are paid for work undertaken and receive holidays and rest periods in line with regulations. We monitor employees’ holiday usage to ensure they take statutory entitlements and reduce the risk of breaches by publishing employee entitlements. Currently a number of employees are paid in line with the national minimum wage thresholds, however from 1 April 2021 the minimum hourly rate was increased to be that of the Living Wage Foundation hourly rate.

Environment The Group’s operations are all in the UK and comprise office based activities and business travel and therefore environmental risks are relatively low. The Group is conscious of the importance of good environmental practices and aims to achieve on-going improvement in environmental performance and to comply with all relevant regulations. The Group monitors environmental legal requirements and other compliance obligations that apply to our business, including industry codes of practice and takes action to ensure that all parts of the Group remain compliant with the relevant obligations identified. Further information on environmental initiatives and SECR reporting are contained in the Directors’ Report.

General Data Protection Regulation (GDPR) On 25 May 2018, the General Data Protection Regulation (GDPR) came into force in the EU and the Data Protection Act 2018 (DPA) came into force in the UK. The Group implemented policies, controls and procedures across the business to manage personal data in accordance with the provisions of the GDPR and the DPA and these continue to be embedded through a programme of training and ongoing communication.

On behalf of the Board,

V L Vaghela Director 22 April 2021 JPIMedia Publishing Limited Registered in England and Wales No.11499982

JPIMEDIA PUBLISHING GROUP

DIRECTORS’ REPORT FOR THE PERIOD ENDED 2 JANUARY 2021

The Directors present their report and the audited consolidated Financial Statements for the 52 week period ended 2 January 2021.

Directors of the Group

The Directors, who held office during the period and up to the date of signing, unless otherwise stated, were as follows:

D J Montgomery (appointed 2 January 2021) V L Vaghela (appointed 2 January 2021) P S Sandhu (appointed 8 January 2019, resigned 2 January 2021) D K Duggins (appointed 28 September 2018, resigned 2 January 2021)

Company secretary

OHS Secretaries Limited (appointed 15 January 2021) P M McCall (appointed 22 November 2018, resigned 15 January 2021)

No Director had any material transactions with the Group other than those set out in the related parties disclosure note (Note 25).

Dividends

No dividends were declared or paid during the period ended 2 January 2021 (2019 - £nil).

Employee involvement

It is the policy of the Group to encourage and develop all employees to realise their maximum potential. Wherever possible, vacancies are filled from within the Group and adequate opportunities for internal promotion are created. The Board is committed to a systematic training policy and the Group has a comprehensive training and development programme creating the opportunity for employees to maintain and improve their performance and to develop their potential to a maximum level of attainment. In this way, employees will make their best possible contribution to the organisation’s success. The Group supports the principle of equal opportunities in employment and opposes all forms of unlawful or unfair discrimination on the grounds of race, age, nationality, religion, ethnic or national origin, sexual orientation, gender or gender reassignment, marital status or disability. It is also the policy of the Group, where possible, to give sympathetic consideration to disabled persons in their application for employment with the Group and to protect the interests of existing employees who are disabled.

Going Concern

The financial position of the Group, its cash flows and liquidity position are described in the Strategic Report.

In addition, Note 2 of the Financial Statements includes the Group’s objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments; and its exposure to credit risk, liquidity risk and cash flow risk.

These Financial Statements have been prepared on a going concern basis. The Directors consider the use of the going concern basis of accounting to be appropriate, despite facing revenue declines due to the coronavirus pandemic. The Directors have partly mitigated the impact of revenue declines on cash flows through reduced operating costs and participated in the Government Furlough scheme. The Directors have seen advertising and circulation revenues improve when the restrictions due to lockdown have been eased however a high degree of uncertainty continues to exist.

The Group has sufficient cash resources and operating headroom to support the activities of the business. Positive net operating cash flow predictions are expected to support the Group’s ability to meet their obligations as and when they fall due for the foreseeable future.

In assessing the longer term viability of the Group, the Directors believe sufficient cash flows will be generated by the Group in order to meet the obligations required. Although the Company has no external debt, National World acquired the business on 2 January 2021 and funded the acquisition from its existing cash resources and the issue of £20 million convertible secured loan notes and £1 million of interest only unsecured loan notes. As set out on page 12, National World provided working capital facilities of £10.5 million to the Group. The Directors will continue to review the operations and capital structure of the Group. National World have confirmed that it will provide financial support as might be necessary to ensure that the Group is a going concern for at least 12 months from the date of signing these Financial Statements.

After making enquiries, the Directors have a reasonable expectation that the Group and the Company have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the Annual Report and Financial Statements.

JPIMEDIA PUBLISHING GROUP

DIRECTORS’ REPORT FOR THE PERIOD ENDED 2 JANUARY 2021

Environmental

The Group takes its environmental responsibilities very seriously, including monitoring the impact of its business activities on the environment and designs and implements policies to reduce any damage to the environment that may be caused by its activities. The car fleet is leased as the vehicles are newer and more efficient and play a part in improving our environmental performance. The impact of COVID-19 has accelerated changes to working practices, with many employees working from home for a significant part of the financial year and an increase in the use of virtual meetings, reducing our carbon footprint due to less travel and offices being closed.

Streamlined Energy Carbon Reporting (SECR) 2020

UK energy usage

KWh 2,456,028

Associated greenhouse gas emissions

Tonnes CO2 equivalent 578.82

Intensity ratio

Emissions per £m turnover 6.36

SECR is applicable to financial years starting on or after 1 April 2019, as this is the Group’s first year of reporting there are no comparatives for the prior period.

UK energy usage covers the mains electricity and gas used in our offices and car journeys undertaken in our vehicles and those of our employees across the Group.

Associated greenhouse gases have been calculated using the KWh directly supplied by the Group’s energy suppliers, landlords and from the Group’s expense data converted using the appropriate conversion factors.

Events after the reporting period

On 2 January 2021, the Group was acquired by National World. Post acquisition, National World provided working capital facilities of £10.5 million to the Group to enable the Group to repay an outstanding inter-company balance payable to the former parent company, JPIMedia Limited (£4.7 million) and to provide working capital (£5.8 million). National World has also provided a letter of support to fund the operations of the Group.

Outlook

The trading environment remains challenging in 2021 due to the National lockdown imposed by the UK government and the Scotland, Wales and Northern Ireland devolved governments. Whilst there remains uncertainty in the economic outlook, the ongoing benefit from management initiatives will provide support to revenue and profit during 2021. s418 statement

This confirmation is given and should be interpreted in accordance with the provisions of s418 of the Companies Act 2006.

The Directors are responsible for preparing the Annual Report and the Financial Statements in accordance with applicable law and regulations.

Company law requires the Directors to prepare Financial Statements for each financial year. Under that law the Directors are required to prepare the Group Financial Statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and have elected to prepare the parent company Financial Statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the Directors must not approve the Financial Statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Company and of the profit or loss of the Group and the Company for that period.

In preparing these Financial Statements, the Directors are required to: • select suitable accounting policies and then apply them consistently; • make judgements and accounting estimates that are reasonable and prudent; • state whether applicable IFRSs as adopted by the European Union and applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the Group and parent company Financial Statements respectively; and • prepare the Financial Statements on the going concern basis unless it is inappropriate to presume that the Group and the Company will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the 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 comply with the Companies Act 2006.

JPIMEDIA PUBLISHING GROUP

DIRECTORS’ REPORT FOR THE PERIOD ENDED 2 JANUARY 2021

The Directors are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In accordance with Section 418 of the Companies Act 2006, each director in office at the date the Directors’ report is approved confirms that: • so far as the Director is aware, there is no relevant audit information of which the Company’s auditors are unaware; and • he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the Company’s auditors are aware of that information.

We confirm that to the best of our knowledge the: • Financial Statements, prepared in accordance with International Financial Reporting Standards as adopted by the EU, 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; • 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 • Annual Report and Financial Statements, taken as a whole, are fair, balanced and understandable and provide the information necessary for shareholders to assess the Company’s performance, business model and strategy.

On behalf of the Board,

V L Vaghela Director 22 April 2021

JPIMedia Publishing Group Registered in England and Wales No.11499982

JPIMEDIA PUBLISHING GROUP

INDEPENDENT AUDITORS’ REPORT TO THE DIRECTORS OF JPIMEDIA PUBLISHING LIMITED FOR THE PERIOD ENDED 2 JANUARY 2021

Independent Auditor’s Report to the Directors of JPIMedia Publishing Limited

Opinion

We have audited the financial statements of JPIMedia Publishing Limited (the “parent company”) and its subsidiaries (the “group”) for the year ended 2 January 2021 which comprise a consolidated income statement, consolidated statement of financial position, consolidated statement of changes in equity, consolidated cash flow statement and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in the preparation of the financial statements is applicable law and International Financial Reporting Standards (IFRSs) as adopted by 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 2 January 2021 and of the group’s loss for the period then ended; • the group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union; • the parent company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union as applied in accordance with the provisions of the Companies Act 2006; and • the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the group 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, 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 director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

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 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.

Other information

The directors are responsible for the other information contained within the annual report. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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 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.

Opinion on other matter prescribed by the Companies Act 2006

In our opinion based on the work undertaken in the course of our audit

• the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and • the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

JPIMEDIA PUBLISHING GROUP

INDEPENDENT AUDITORS’ REPORT TO THE DIRECTORS OF JPIMEDIA PUBLISHING LIMITED FOR THE PERIOD ENDED 2 JANUARY 2021

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

• adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or • the parent company financial statements are not in agreement with the accounting records and returns; or • certain disclosures of directors' remuneration specified by law are not made; or • we have not received all the information and explanations we require for our audit

Responsibilities of directors

As explained more fully in the directors’ responsibilities statement set out on pages 12 to 13, 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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be the override of controls by management. Our audit procedures to respond to these risks included enquiries of management about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals and reviewing accounting estimates for biases.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities . This description forms part of our auditor’s report.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Leo Malkin Senior Statutory Auditor For and on behalf of Crowe U.K. LLP Statutory Auditor London

22 April 2021

JPIMEDIA PUBLISHING GROUP

CONSOLIDATED INCOME STATEMENT FOR THE PERIOD ENDED 2 JANUARY 2021

52 weeks to 74 weeks to 2 January 4 January 2021 2020 Notes £’000 £’000

Continuing operations Revenue 4 88,163 131,050 Cost of sales (72,869) (102,225)

Gross profit 15,294 28,825

Operating expenses before exceptional items (17,192) (23,088)

Exceptional items: Impairment of goodwill 10 - (13,642) Impairment of intangible fixed assets 11 (24,521) (891) Write off of fixed assets 12 (522) - Continuity of supply expenses 5 - (6,076) Restructuring, redundancy and reorganisation costs 5 (3,524) (5,380) Gain on sale of investment 5 - 1,900 Aborted transaction fees 5 (1,008) (517) Transition and strategic costs 5 - (232) Derecognition of restricted cash 5 (1,500) - Other 5 (31) (207)

Total operating expenses (48,298) (48,133)

Operating loss (33,004) (19,308)

Financing Interest receivable 8 47 161 Finance costs 8 (304) -

Total net finance (expense)/income (257) 161

Loss before tax (33,261) (19,147) Tax credit 9 2,113 1,483

Loss from continuing operations (31,148) (17,664)

The accompanying notes are an integral part of these Financial Statements.

JPIMEDIA PUBLISHING GROUP

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD ENDED 2 JANUARY 2021

52 weeks to 74 weeks to 2 January 4 January 2021 2020 £’000 £’000

Loss for the period (31,148) 17,664)

Total other comprehensive loss for the period --

Total comprehensive loss for the period (31,148) (17,664)

The accompanying notes are an integral part of these Financial Statements.

JPIMEDIA PUBLISHING GROUP

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 2 JANUARY 2021

2 January 4 January 2021 2020 Notes £’000 £’000

Non-current assets Intangible assets 11 10,968 42,227 Tangible assets 12 1,438 2,389 Right of use assets 17 3,176 - Trade and other receivables 14 477 - 16,059 44,616

Current assets Trade and other receivables 14 12,774 17,061 Intercompany receivable 16 - 8,829

Inventory 13 16 -

Cash and cash equivalents 14 472 19,052

13,262 44,942

Total assets 29,321 89,558

Current liabilities Trade and other payables 14 (18,489) (16,983) Intercompany payable 16 - (87,621) Leases 17 (1,353) - Short-term provisions 20 - (5)

(19,842) (104,609)

Non-current liabilities Leases 17 (1,826) - Deferred tax liabilities 19 - (2,113) Long-term provisions 20 (500) (500)

(2,326) (2,613)

Total liabilities (22,168) (107,222)

Net assets / (liabilities) 7,153 (17,664)

Equity Share premium 21 55,978 - Retained losses 22 (48,825) (17,664)

Total shareholders’ funds 7,153 (17,664)

The accompanying notes are an integral part of these Financial Statements.

The consolidated Financial Statements of JPIMedia Publishing Limited, registered in England and Wales (number 11499982), were approved by the Board of Directors and authorised for issue on 22 April 2021. They were signed on its behalf by:

V L Vaghela Director

JPIMEDIA PUBLISHING GROUP

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 2 JANUARY 2021

Share Share Retained capital Premium losses Total Notes £’000 £’000 £’000 £’000

Equity as at 4 January 2020 –– (17,664) (17,664)

Change of accounting policy – application of IFRS16 28 –– (13) (13)

Equity as at 5 January 2020 –– (17,677) (17,677)

Loss for the period –– (31,148) (31,148)

Total comprehensive loss for the period –– (31,148) (31,148)

Issue of Shares 21 – 55,978 – 55,978

Equity as at 2 January 2021 22 – 55,978 (48,825) 7,153

Share Share Retained capital Premium losses Total Notes £’000 £’000 £’000 £’000

Opening balances at 28 September 2018 on incorporation –– ––

Loss for the period –– (17,664) (17,664) Total comprehensive loss for the period –– (17,664) (17,664)

Equity as at 4 January 2020 22 –– (17,664) (17,664)

The accompanying notes are an integral part of these Financial Statements.

JPIMEDIA PUBLISHING GROUP

CONSOLIDATED CASH FLOW STATEMENT FOR THE PERIOD ENDED 2 JANUARY 2021

52 weeks to 74 weeks to 2 January 4 January 2021 2020 Notes £’000 £’000

Cash flow from operating activities Cash generated from operations 23 6,78 0 24,925 Net cash inflow from operating activities 6,78 0 24,925

Investing activities Interest received 8 47 161 Proceeds on disposal of tangible assets 12 30 - Expenditure on digital intangible assets 11 (538 ) (3,148) Purchases of tangible assets 12 (476) (1,055) Net cash outflow from investing activities (937) (4,042)

Financing activities Intercompany debt settlement (22,814 ) (1,831) Interest paid 8 (304) - Principal repayment of leases 17 (1,305) - Net cash used in financing activities (24,423 ) (1,831)

Net increase in cash and cash equivalents (18,580 ) 19,052 Cash and cash equivalents at the beginning of period 19,052 -

Cash and cash equivalents at the end of the period 14 472 19,052

The accompanying notes are an integral part of these Financial Statements.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

1. Basis of preparation

General information

JPIMedia Publishing Limited (‘the Company’) is a private limited company domiciled and incorporated in England and Wales under the Companies Act 2006. The registered office is 107 Cheapside, London, EC2V 6DN, United Kingdom. The principal activities of the Group are to provide news and information services in the United Kingdom through a portfolio of multimedia publications and websites.

The consolidated Financial Statements of the Company and its subsidiaries for the 52 week period ended 2 January 2021 comprise the Company and its subsidiaries (together referred to as the ‘Group’).

JPIMedia Publishing Limited and its subsidiaries were acquired on 2 January 2021 by National World from JPIMedia Limited, a subsidiary of JPIMedia Holdings Limited. Previously the Group’s results have been reported as part of the consolidated results of the JPIMedia Holdings Limited Group. With the disposal at period end, the Directors thought it appropriate to prepare consolidated Financial Statements for the new Group, including prior year comparatives. The comparatives have been prepared on the same basis as the current period, with the exception of the adoption of IFRS 16 on 5 January 2020, being the first accounting period to commence post 1 January 2019. The company uses 52/53 week accounting periods and has drawn up its financial statements for the 52 weeks to Saturday, 2 January 2021. The 52 weeks to 2 January 2021 and the balances at that date are referred to as 2020 in these financial statements. The 74 weeks (of which 15 weeks are non-trading) to Saturday, 4 January 2020 and the balances at that date are referred to as relating to 2019. Adjustments have been made to the Statutory results to enable the commentary on the comparable results in the Financial Review section of the Strategic Report. In future periods, the Group will form part of the National World Group.

Basis of preparation

These Financial Statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board as adopted by the European Union. The consolidated Financial Statements were authorised for issue by the Board of Directors on 22 April 2021.

These Financial Statements are presented in British pounds, which is the functional currency of all entities in the Group. All financial information has been rounded to the nearest thousand except when otherwise indicated.

These Financial Statements have been prepared under the historical cost basis.

Going concern

The financial position of the Group, its cash flows and liquidity position are described in the Strategic Report.

In assessing the longer term viability of the Group, the Directors believe sufficient cash flows will be generated by the Group in order to meet the obligations required. Although the Company has no external debt, National World acquired the business on 2 January 2021 and funded the acquisition from its existing cash resources and the issue of £20 million convertible secured loan notes and £1 million interest only unsecured loan notes. As set out on page 12, National World provided working capital facilities of £10.5 million to the Group. The Directors will continue to review the operations and capital structure of the Group. National World have confirmed that it will provide financial support as might be necessary to ensure that the Group is a going concern for at least 12 months from the date of signing these Financial Statements.

Changes in accounting policies and disclosures

The Group has adopted IFRS16 Leases in the financial statements for the period ended 2 January 2021. The adoption of IFRS 16 had a material impact on the Group’s financial statements, and resulted in adjustment to opening balances as at 5 January 2020. The impact of the adoption is disclosed in Note 28. Other standards that became applicable in the year did not materially impact the Group’s accounting policies and did not require retrospective adjustments.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

2. Significant accounting policies

New and revised IFRS Standards in issue but not yet effective

At the date of authorisation of these Financial Statements, several new, but not yet effective Standards and amendments to existing Standards, and Interpretations have been published by the IASB. None of these Standards or amendments to existing Standards have been adopted early by the Group. Management anticipates that all relevant pronouncements will be adopted for the first period beginning on or after the effective date of the pronouncement. New Standards, amendments and Interpretations not adopted in the current year have not been disclosed as they are not expected to have a material impact on the Group’s financial statements.

Basis of consolidation

The Group Financial statements consolidate the Financial Statements of JPIMedia Publishing Limited and all its subsidiary undertakings as of 2 January 2021.

Subsidiaries are included in the Group’s Financial Statements using the acquisition method of accounting. The results of subsidiaries acquired or disposed of during the period are consolidated from the effective date of acquisition or up to the effective date of disposal, as appropriate. Purchase consideration is allocated to the assets and liabilities on the basis of their fair value at the date of acquisition. All intra-group transactions, balances, income and expenses are eliminated on consolidation.

Where necessary, adjustments are made to the Financial Statements of subsidiaries to bring the accounting policies used into line with those used by the Group.

Business combinations

The acquisition of subsidiaries is accounted for using the acquisition method. The cost of the acquisition is measured at the aggregate of the fair values at the date of exchange of assets given, liabilities incurred or assumed and equity instruments issued by the Group in exchange for control of the acquiree. Acquisition-related costs are recognised in the Income Statement as incurred.

The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under IFRS 3, including publishing titles, are recognised at their fair value at the acquisition date, except for: • deferred tax assets or liabilities related to employee benefit arrangements are recognised and measured in accordance with IAS 12 Income Taxes and IAS 19 Employee Benefits, respectively; and • non-current assets (or disposal Groups) that are classified as held for sale in accordance with IFRS 5 ‘Non-Current Assets Held for Sale and Discontinued Operations’, are recognised and measured at fair value less costs to sell.

Revenue recognition

The Group recognises revenue when goods/services are provided and the performance obligation is fulfilled. The Group recognises revenue from the following major sources:

Circulation revenue

The Group sells newspapers through wholesalers and distributors. Revenue is recognised, net of returns and discounts, when the performance obligation has been fulfilled being when the goods have been delivered to or purchased by a reader. A receivable is recognised by the Group when the wholesaler and distributor confirms the number of copies sold as this represents the point in time at which the right to consideration becomes unconditional, as only the passage of time is required before payment is due.

Print and digital subscriptions

Subscription revenues are recognised over the duration of the subscription with the provision of a digital newspaper edition being the single performance obligation.

Advertising revenue

Advertising revenue is recognised on publication of the advertisement, which is when the performance obligation has been fulfilled. If an advertising campaign relates to a longer duration of time, revenue will be recognised over the period of the campaign, reflecting the pattern in which the performance obligation was fulfilled.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

2. Significant accounting policies (continued)

Other revenue

Other revenues include syndication, provision of leaflets, readers’ offers and events and funding for local journalists. The performance obligation is fulfilled, and revenue is recognised on publication of the product, holding of the event, when goods have been purchased by a reader or at a point when the service is provided, depending on the nature of the other revenue.

Accrued income

Where the performance obligation has been fulfilled, but the customer has not yet been billed, an accrued income asset is recognised. The accrued income balance is released once the sales invoice has been issued.

Deferred income

Sales invoices are raised in line with the contract terms, and reported in deferred income until the performance obligations identified in the contract are fulfilled and revenue can be recognised. The deferred income balance is released once the performance obligation has been fulfilled.

Exceptional items

Exceptional items are non-recurring items that are considered significant enough to require disclosure on the face of the income statement. See further details in Note 5.

Pension costs

The Company participates in a Group operated defined contribution scheme.

The costs of the Company’s contributions to the defined contribution scheme are charged to the profit or loss account as they become due under the rules of the scheme. Further details regarding pension costs are provided in Note 18.

Goodwill

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer’s previously held interest in the acquiree (if any), the excess is recognised immediately in profit or loss as a bargain purchase gain.

Goodwill is not amortised but is reviewed for impairment at least annually. For the purpose of impairment testing, goodwill is allocated to the Group’s Cash- Generating Unit “CGU” (or Groups of Cash-Generating Units “CGUs”) expected to benefit from the synergies of the combination. The CGU to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the CGU is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. An impairment loss recognised for goodwill is not reversed in a subsequent period. On disposal of a CGU, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

Intangible assets

The Group’s principal intangible assets are regional publishing titles. The Group does not capitalise internally generated publishing titles. Titles are recorded at fair value at the date of acquisition. These publishing titles have a finite life and consequently are amortised over their useful economic life. The carrying value of the titles is reviewed when there are indicators that an impairment has occurred with testing undertaken to determine any diminution in the recoverable amount below carrying value. The recoverable amount is the higher of the fair value less costs to sell and the value in use which is based on the net present value of estimated future cash flows. The discount rate is post-tax and reflects current market assessments of time value of money and risks specific to asset for which estimates of future cash flows have not been adjusted. Any impairment loss is recognised as an expense immediately. A reversal of an impairment loss is recognised immediately in the Group Income Statement given these assets are not carried at revalued amounts.

For the purpose of impairment testing, regional publishing titles are considered as being one CGU. The CGU is determined by grouping assets at the lowest levels for which there are separately identifiable cash flows. CGUs are tested for impairment annually or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the CGU is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of goodwill, then to reduce the carrying value of tangible and intangible assets and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

2. Significant accounting policies (continued)

Digital intangible assets

Digital intangible assets relate to the Group’s local websites and computer software, which form the core platform for the Group’s digital revenue activities and support the Editorial and Sales functions. These assets are being amortised using the straight-line method over the expected life, of three to five years. Amortisation for the period has been charged through cost of sales. Digital intangible assets are tested for impairment only when there is an indication that the recoverable amount is less than the carrying amount. Costs incurred in the development of websites are only capitalised if the criteria specified in IAS 38 are met.

Tangible assets

Tangible asset balances are shown at cost, net of depreciation and any provision for impairment.

Depreciation is provided on all tangible assets, excluding land, at varying rates calculated to write-off cost over the useful lives. The principal rates employed are:

Freehold land Nil Freehold property 2.5% reducing balance Fixtures and fittings (leasehold properties) Over term of lease Office equipment 6.67% to 33% straight-line Motor vehicles 25% straight-line

A tangible asset is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. The gain or loss arising on the disposal or scrappage of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in income.

Inventories

Inventories, largely paper, are stated at the lower of cost and net realisable value. Costs incurred in bringing materials to their present location and condition comprises purchase cost on a first-in first-out basis. Net realisable value comprises selling price less any further costs expected to be incurred to completion and disposal.

Cash and cash equivalents

Cash and cash equivalents comprise cash and short-term bank deposits with an original maturity of three months or less. The carrying amount of these assets is approximately equal to their fair value. Cash and cash equivalents at the end of the reporting period as shown in the Consolidated Statement of Cash Flows can be reconciled to the related items in the consolidated reporting position.

Financial instruments

Financial assets and financial liabilities are recognised in the Group’s Statement of Financial Position when the Group becomes a party to the contractual provisions of the instrument.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in profit or loss.

Trade receivables

Trade receivables do not carry any interest. Conversion to a readily known amount of cash occurs over a short period and is subject to an insignificant risk of changes in value. Therefore balances are initially recognised at fair value and subsequently at amortised cost.

The Group recognises a loss allowance for expected credit losses (ECL) on trade receivables and contract assets. The amount of expected credit losses is updated at each reporting date to reflect changes in credit risk since initial recognition.

The Group recognises lifetime ECL for trade receivables, lease receivables and contract assets. The expected credit losses on these financial assets are estimated using a provision matrix based on the Group’s historical credit loss experience, adjusted for factors that are specific to the debtors, general economic conditions and an assessment of both the current as well as the forecast direction of conditions at the reporting date.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

2. Significant accounting policies (continued)

Credit-impaired financial assets

A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of that financial asset have occurred. Evidence that a financial asset is credit-impaired includes observable data about the following events: (a) Significant financial difficulty of the debtor; (b) A breach of contract, such as a default or past due event; (c) It is becoming probable that the debtor will enter bankruptcy or other financial reorganisation.

Write-off policy

The Group writes off a financial asset when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery e.g. when the debtor has been placed in liquidation or has entered into bankruptcy proceedings. Financial assets written off may still be subject to enforcement activities under the Group’s recovery procedures, taking into account legal advice where appropriate. Any recoveries made are recognised in the income statement.

Measurement and recognition of expected credit losses

The measurement of expected credit losses is a function of the probability of default, loss given default (i.e. the magnitude of the loss if there is a default) and the exposure at default. The assessment of the probability of default and loss given default is based on historical data adjusted by forward looking information as described above. The expected credit loss is estimated as the difference between all contractual cash flows that are due to the Group in accordance with the contract and all the cash flows that the Group expects to receive.

The Group recognises an impairment gain or loss in profit or loss for all financial instruments with a corresponding adjustment to their carrying amount through a loss allowance account.

Trade payables

Trade payables are not interest bearing. Payments occur over a short period and are subject to an insignificant risk of changes in value. Therefore balances are stated at their nominal value.

Leases

The Group has applied IFRS 16 with effect from 5 January 2020, being the first accounting period commencing post 1 January 2019.

At inception, the Group assesses whether a contract is or contains a lease. This assessment involves the exercise of judgement about whether it depends on a specified asset, whether the Group obtains substantially all the economic benefits from the use of that asset, and whether the Group has the right to direct the use of the asset. The Group recognises a right of use (ROU) asset and lease liability at the commencement of the lease.

The Group has elected not to recognise ROU assets and lease liabilities for leases where the total lease term is less than or equal to 12 months, or for leases of assets with a value less than £4,000. The payments for such leases are recognised in the income statement on a straight-line basis over the lease term. Fees for components such as property taxes, maintenance, repairs and other services which are either variable or transfer benefits separate to the Group’s ROU assets are separated from lease components based on their relative stand alone selling price.

Lease liabilities are initially measured at the present value of future lease payments at the commencement date. Lease payments are discounted using the interest rate implicit in the lease, or where this cannot be readily determined, the lessee’s incremental borrowing rate. Lease payments include the following payments due within the non-cancellable term of the lease, as well as the term of any extension options where these are considered reasonably certain to be exercised: • fixed payments • variable payments that depend on an index or rate • the exercise price of purchase or termination options if it is considered reasonably certain these will be exercised.

Subsequent to the commencement date, the lease liability is measured at the initial value, plus an interest charge determined using the incremental borrowing rate, less lease payments made. The interest expense is recorded in finance costs in the income statement. The liability is remeasured when future lease payments change, when the exercise of extension or termination options becomes reasonably certain, or when the lease is modified.

The ROU asset is initially measured at cost, being the value of the lease liability, plus the value of any lease payments made at or before the commencement date, initial direct costs and the cost of any restoration obligations, less any incentives received.

The ROU asset is subsequently measured at cost less accumulated depreciation and impairment losses. The ROU asset is adjusted for any remeasurement of the lease liability. The ROU asset is subject to testing for impairment where there are any impairment indicators.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

2. Significant accounting policies (continued)

Policy prior to 5 January 2020 Rentals payable under operating leases are charged to the consolidated income statement on a straight-line basis over the term of the relevant lease. Benefits received and receivable as an incentive to enter into an operating lease are also spread on a straight-line basis over the lease term.

Provisions

Provisions are recognised when the Group has a present obligation as a result of a past event and it is probable that the Group will be required to settle that obligation. Provisions are measured at the Directors’ best estimate of the expenditure required to settle the obligation at the reporting date and are discounted to present value where the effect is material.

Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the period. Taxable profit differs from net profit as reported in profit or loss because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.

A provision is recognised for those matters for which the tax determination is uncertain but it is considered probable that there will be a future outflow of funds to a tax authority. The provisions are measured at the best estimate of the amount expected to become payable. The assessment is based on the judgement of tax professionals within the Group supported by previous experience in respect of such activities and in certain cases based on specialist independent tax advice.

Deferred tax

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the Financial Statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the liability method. 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. Such assets and liabilities are not recognised if the temporary difference arises from the initial recognition of goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only recognised to the extent that it is probable that there will be sufficient taxable profits against which to utilise the benefits of the temporary differences and they are expected to reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised based on tax laws and rates that have been enacted or substantively enacted at the reporting date. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

Current tax and deferred tax for the period

Current and deferred tax are recognised in profit or loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

2. Significant accounting policies (continued)

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Equity instruments issued by the Company are recorded at the proceeds received net of direct issue costs.

Ordinary shares are classified as equity. • The share capital account represents the nominal value of the shares issued. • The share premium account represents premiums received on the initial issuing of the share capital. Incremental costs directly attributable to the issue of new shares are shown in share premium as a deduction from the proceeds, net of tax. • Accumulated losses include all current period results as disclosed in the Statement of Comprehensive Income.

3. Critical accounting judgements and key sources of estimation uncertainty

Critical judgements in applying the Group’s accounting policies

In applying the Group’s accounting policies, which are described in Note 2, the Directors are required to make judgements (other than those involving estimations) that have a significant impact on the amounts recognised and to make estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

Impairment of publishing titles

Key areas of judgement in the value in use calculation include the identification of appropriate CGUs. The Group has identified one CGU, the regional publishing business. This is considered to be the lowest level at which cash inflows generated are largely independent of the cash inflows from other groups of assets and has been consistently applied across the Group.

Key sources of estimation uncertainty

Impairment of publishing titles

The Group is required to test, whether intangible and tangible assets have suffered any impairment based on the recoverable amount of its CGUs, when there are indicators for impairment. Determining whether the regional business is impaired requires an estimation of the value in use of the CGU to which these assets are allocated. Key sources of estimation uncertainty in the value in use calculation include the estimation of future cash flows of the CGU affected by expected changes in underlying revenues and direct costs as well as corporate and central cost allocations through the forecast period, the long- term growth rates and a suitable discount rate to apply to the aforementioned cash flows in order to calculate the net present value. The discount rate selected for the regional business CGU was 17%, using the Capital Asset Pricing Method (“CAPM”) with a long-term decline rate in perpetuity of 1.0%.

Valuation judgements

Intangible Assets

Intangible assets are required to be assessed for potential impairment on an annual basis or if there is a trigger for impairment. In a transactional based situation, given the acquisition by National World on the period end date, the valuation of intangibles should be the higher of the consideration paid or the value in use of the CGU. The value in use has been assessed using consistent methodologies to that applied in the prior period. With regard to the methodologies applied in the valuation, the intangible assets of the Group were assessed using an income approach based method. The income approach is suitable for assets which generate the majority of their value from their income-generating capacity. It operates under the premise that the value of that asset can be accurately derived from the value of the future net cash inflows or cost savings which will be generated by it over time, discounted back to their present value at an appropriate discount rate.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

4. Revenue

The analysis of the Group’s contracted revenue for the period from continuing operations is as follows:

202 0 20 19 £’000 £’000

Newspaper sales 37,930 52,249 Print advertising 28,105 49,253 Digital advertising 17,225 23,228 Other 1 4,903 6,320

Total revenue 88,163 131,050

The description and revenue recognition criteria (timing and performance obligations) for each revenue stream is contained within the accounting policies, in Note 2. The Directors do not consider there to be a significant judgment with respect of recognising revenue under IFRS 15. The reconciliation for contract assets and liabilities associated with contracted revenue can be found in Note 15.

1 Includes Local Democracy Reporting Service funding from the BBC to support news coverage of top-tier local authorities and other public service organisations; 2020: £1.5 million (2019: £1.4 million).

5. Loss for the period

202 0 20 19 Notes £’000 £’000

Operating loss for continuing operations is shown after charging/(crediting): Depreciation of tangible fixed assets 12 875 790 Amortisation of intangible assets 11 7,276 7,491 Depreciation of right of use assets 17 1,421 - Staff costs 7 53,416 66,337 Operating lease charges: Property - 1,133 Motor vehicles - 855 Short term and low value leases 17 602 - Rental costs under licence to occupy agreements 24 696 2,015 Dilapidations provision expense 20 - 500 Exceptional items: Impairment of goodwill 10 - 13,642 Impairment of intangibles 11 24,521 891 Write off of tangible fixed assets 12 522 - Continuity of supply payments - 6,076 Restructuring, redundancy and reorganisation costs 3,524 5,380 Gain on sale of investment - (1,900) Transaction fees 1,008 517 Strategic review - 232 Derecognition of restricted cash 1,500 - Other 31 207

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

5. Loss for the period (continued)

Impairment of intangibles A review of the carrying value of intangible assets concluded an impairment of £24.5 million to the carrying value of intangible assets and the release of £2.1 million deferred tax creditor. Refer Notes 11 and 19 for further details.

Continuity of supply payments During 2019, continuity of supply payments were made to key suppliers subsequent to the 17 November 2018 acquisition, to ensure uninterrupted supplies of goods and services which management chose to pay in order to continue normal operations and revenue generation.

Restructuring and redundancy costs Restructuring and redundancy-related costs are material and incurred to transform and restructure the business cost base resulting in a reduction in headcount. Adjustments for redundancy costs do not include those incurred in the ordinary course of business, which are treated as operating costs, or that may lead to a direct replacement being appointed.

Derecognition of restricted cash Under the terms of the Share Purchase Agreement between JPIMedia Limited and National World, £1.5 million restricted cash held by JPIMedia Publishing Limited on account with Barclays bank has an undertaking by Barclays upon release of the security by Barclays, or 18 months following the completion of the acquisition by National World on 2 January 2021, it is repayable to JPIMedia Limited. Therefore, the cash balance has been derecognised as an asset as at the period-end.

Gain on sale of investment In August 2019, the Company sold its investment in JPIMedia 2018 Limited to JPIMedia Limited and recorded a £1.9 million gain on sale in its Income Statement.

Transaction fees Transaction costs includes retention bonus accrual for senior management of £0.6 million (2019: £0.3 million), and intercompany balance write-offs of £0.4 million (2019: £0.2 million). These costs are directly linked to the aborted disposal in 2019, or to disposals of former group subsidiaries by JPIMedia Limited.

Strategic Review During 2019, strategic review costs of £0.2 million were incurred on professional advisory fees following the acquisition of the principal assets and business of Johnston Press plc (now dissolved).

Other exceptional costs Other costs include £0.2 million of libel settlement costs (2019: £0.2 million), offset by minor credit adjustments relating to the prior year.

6. Auditors remuneration

Crowe U.K. LLP have been appointed auditors for the current period. The analysis of Crowe U.K. LLP’s remuneration is as follows:

2020 20 19 £’000 £’000

Fees payable for the audit of the Company’s annual accounts 50 - Fees payable for other services: audit of subsidiary accounts 75 - Total audit fees 125 -

The Company audit fee reflects the requirement to prepare consolidated Group accounts, following the acquisition by National World on 2 January 2021. For the prior period, PricewaterhouseCoopers LLP were auditors of the former ultimate parent, JPIMedia Holdings Limited and its subsidiaries, and the audit fees were allocated from the parent.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

6. Auditors remuneration (continued)

The analysis of PricewaterhouseCoopers LLP remuneration is as follows: 2020 20 19 £’000 £’000

Fees payable for the audit of the Company’s annual accounts - 20 Fees payable for other services: audit of subsidiary accounts - 75 Fees payable relating to prior year audit of the Company 41 -

Total audit fees 41 95

Non-audit services Tax compliance services 20 21 Tax advisory services 61 - Total non-audit services 81 21

Total audit and non-audit service fees 122 116

All non-audit services have been provided by PricewaterhouseCoopers LLP.

7. Employees and Directors

The average number of employees, including Executive Directors for the continuing operations, was: 202 0 20 19

Editorial and photographic 755 791 Sales and distribution 513 633 Production 98 102 Administration 99 107

Average number of employees 1,465 1,633

Their remuneration comprised of:

2020 2019 £’000 £’000

Wages and salaries 43,717 55,143 Social security costs 4,209 5,435 Other pension costs 2,466 2,819 Redundancy costs 3,024 2,940

Total staff costs 53,416 66,337

£3.9 million of furlough funding was claimed from HMRC in the period by JPIMedia Publishing Limited for the total PAYE group. This included £3.5 million relating to the Group, and £0.4 million for the print business (sold to dmg media Limited on 17 October 2020) which was not part of the Group. The £3.5 million credit is reported in cost of sales for the Group and is not included in the staff costs disclosed above.

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including any director (whether executive or otherwise) of that entity.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

7. Employees and Directors (continued)

Key management personnel compensation comprises senior management of the Group: 202 0 20 19 £’000 £’000

Short-term employee benefits 916 1,136 Total key management personnel compensation 916 1,136

During the year, no Director received remuneration from the Group or payment for services specifically for the Group as payment was made by the ultimate parent JPIMedia Holdings Limited (2019: £ Nil).

8. Financing

Finance income

2020 2019 £’000 £’000

Interest income on bank balances 47 161 Total finance income 47 161

Finance costs 202 0 20 19 £’000 £’000

Interest expense from leasing arrangements 304 - Total finance costs 304 -

9. Tax

The tax on loss comprises: 202 0 20 19 £’000 £’000

Deferred tax (Note 19) Credit for the period (3,787 ) (1,483) Increase in deferred tax rate to 19% 248 - Deferred tax derecognised 1,426 - Total deferred tax credit (2,113) (1,483)

Total tax credit for the period (2,113) (1,483)

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

9. Tax (continued)

The standard rate of UK corporation tax applied to the reported loss is 19%. The difference between the total tax credit shown above and the amount calculated by applying the standard rate of UK corporation tax of 19% to the loss before tax is as follows:

202 0 2019 £’000 % £’000 %

Loss before tax (33,261 ) (19,147)

Tax at 19.0% (6,319 ) 19.0 (3,638) 19.0 Tax effect of expenses that are not (deductible)/assessable in determining taxable loss 388 (1.2) 65 (0.3) Tax effect of income not taxable in determining taxable profit - - (361) 1.9 Tax effect on goodwill impairment not deductible - - 2,592 (13.5) Accelerated capital allowances 58 (0.2) 36 (0.2) Unrecognised deferred tax assets 3, 943 (11.9) 88 (0.5) Imputed interest (431) 1.3 (703) 3.7 Corporate interest restriction - - 248 (1.3) Effect of increase in deferred tax rate to 19% 248 (0.8) -- Effect of difference between deferred and current tax rate - - 190 (1.0)

Total tax credit for the period (2,113) 6.3 (1,483) 7.8

Note 19 provides further details on deferred tax.

10. Goodwill

Goodwill

Cost Opening balance - On acquisition of subsidiaries 13,642 At 4 January 2020 13,642

Accumulated impairment losses

Opening balance -

Impairment losses for the period (13,642)

At 4 January 2020 (13,642)

Carrying value at 4 January 2020 and 2 January 2021 -

Goodwill was written off following the impairment review of the Group’s identifiable CGU (Note 11).

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

11. Intangible assets Publishing Titles Digital intangible - Regional assets Total £ ‘000 £’000 £’000

Cost At 5 January 2020 37,514 13,095 50,609 Additions - 538 538 Write off - (103) (103) At 2 January 2021 37,514 13, 530 51,044

Accumulated impairment losses and amortisation At 5 January 2020 4,473 3,909 8,382 Amortisation for the period 3,173 4,103 7,276 Impairment for the period 24,521 - 24,521 Write off – (103 ) (103) At 2 January 2021 32,167 7,909 40,076 Carrying value at 2 January 2021 5,347 5,621 10,968

The write off of digital intangible assets in the period relates to website development costs for assets no longer in use.

Publishing Titles Digital intangible - Regional assets Total £ ‘000 £’000 £’000

Cost At incorp oration - - - Acquired on 17 November 2018 37,514 9,947 47,461 Additions - 3,148 3,148 At 4 January 2020 37,514 13, 095 50,609

Accumulated impairment losses and amortisation At incorporation - - - Amortisation for the period 3,582 3,909 7,491 Impairment for the period 891 - 891 At 4 January 2020 4,473 3,909 8,382 Carrying value at 4 January 2020 33,041 9,186 42,227

Impairment assessment

The Group tests the carrying value of the CGU held within the Group for impairment annually or more frequently if there are indications that the carrying value is less than the recoverable amount. If an impairment charge is required this is allocated first to reduce the carrying amount of any goodwill allocated to the CGU and then to the other assets of the CGU but subject to not reducing any asset below its recoverable amount.

The Group has one identifiable CGU, the regional publishing business which includes intangible publishing titles, digital intangible assets, goodwill, property, plant and equipment, trade and other receivables and trade and other payables.

In assessing the valuation of the Intangible assets, consideration has been given to both the National World acquisition price and to the Value in Use of the CGU, with the intangibles impaired to the higher of these values as required by the Accounting Standards.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

11. Intangible assets (continued)

The table below provides the summary of the impairment: 2020 2019 £’000 £’000 Value in use 11,399 41,587 Carrying amount 35,920 56,120 Impairment (24,521) (14,533)

Impairment of component parts: Goodwill N/A 13,642 - JPIMedia Publishing Limited N/A 10,062 - JPIMedia Publishing Limited subsidiaries N/A 3,580 Intangible publishing rights 24,521 891

The Directors consider that publishing titles have finite lives varying from 5 to 16 years. The publishing brands are grouped as one CGU, being the lowest level for which there are separately identifiable cash flows independent of the cash inflows from other assets.

The recoverable amounts of the CGU is determined from value in use calculations. The key assumptions for the value in use calculations are: • expected changes in underlying revenues and direct costs during the period; • corporate and central cost allocations; • growth rates; and • discount rate.

The key assumptions underpinning the Value in Use model are:

2020 2019 Discount rate (WACC) 17.0% 16.0% Long-term decline rate (1.0%) (1.0%)

The Group prepares discounted cash flow forecasts using: • the Board-approved budget for 2021 and projections up to 2025 which reflects management’s current experience and future expectations of the markets the CGUs operate in based on information known at the balance sheet date. This is then forecast into perpetuity from 2025. Changes in underlying revenue and direct costs are based on past practices and expectations of future changes in the market by reference to the Groups own experience and, where appropriate, publicly available market estimates. These include changes in demand for print and digital, circulation, cover prices, advertising rates as well as movement in newsprint and production costs and inflation; • capital expenditure cash flows to reflect the cycle of capital investment required; • net cash inflows for future years are extrapolated beyond 2025 based on the Board’s view of the estimated annual long-term performance. A long-term decline rate of 1% reflecting the markets view of the long-term decline of the newspaper industry; and • management estimates of discount rates that reflect current market assessments of the time value of money, the risks specific to the CGUs and the risks that the regional media industry is facing.

The impairment review is highly sensitive to reasonable possible changes in key assumptions used in the value in use calculations. A combination of reasonably possible changes in key assumptions, such as digital growth being slower than forecast or the decline in print revenues, could lead to a further impairment. Based on the existing modelling: • an increase in the long-term decline rate of 1.0% (which has the effect of increasing the decline from 1% to 2% beyond 2025), would result in a further impairment of £0.8 million. • an increase in the discount rate of 1% from 17.0% to 18.0% would result in an additional impairment of £0.7 million within the regional publishing business.

Digital intangible assets Digital intangible assets primarily relate to the Group’s local websites and computer software, which form the core platform for the Group’s digital revenue activities and supports the Editorial and Sales functions. These assets are being amortised using the straight-line method over the expected life, of three to five years. Amortisation for the period has been charged through cost of sales in the Group, and administration expenses in the Company. Digital intangible assets are tested for impairment only when there is an indication that the recoverable amount is less than the carrying amount. Costs incurred in the development of websites are only capitalised if the criteria specified in IAS38 are met.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

12. Tangible assets

Freehold Land Fixture and Office Motor and Buildings Fittings Equipment Vehicles Total £‘000 £’000 £’000 £’000 £’000 Cost At 5 January 2020 329 264 2,575 9 3,177 Additions - 13 463 - 476 Transfers to former group company - - (43) - (43) Write-down (329) (277) - - (606) Disposals - - (110) (5) (115) At 2 January 2021 - - 2,885 4 2,889 Accumulated impairment losses and depreciation At 5 January 2020 9 4 767 8 788 Depreciation for the period 8 63 803 1 875 Transfers to former group company - - (13) - (13) Write-down (17) (67) - - (84) Disposals - - (110) (5) (115) At 2 January 2021 - - 1,447 4 1,451 Carrying value at 2 January 2021 - - 1,438 - 1,438

Freehold Land Fixture and Office Motor and Buildings Fittings Equipment Vehicles Total £‘000 £’000 £’000 £’000 £’000 Cost At incorporation - - - - - Acquired on 17 November 2018 300 - 1,813 12 2,125 Additions 29 264 762 - 1,055 Disposals - - - (3) (3) At 4 January 2020 329 264 2,575 9 3,177 Accumulated impairment losses and depreciation At incorporation - - - - - Depreciation for the period 9 4 767 10 790 Disposals - - - (2) (2) At 4 January 2020 9 4 767 8 788 Carrying value at 4 January 2020 320 260 1,808 1 2,389

Freehold land and buildings and fixture and fittings balances have been fully written off in the current period. Transfer of office equipment was made during the year to the Print business which was sold to dmg media Limited on 17th October 2020.

13. Inventories 202 0 20 19 £’000 £’000

Consumables 16 -

Inventories consist of newsprint held at outsourced locations for contract printing of publishing titles. No stock was held in the prior period as supply of newsprint was accounted for within JPIMedia Print Holding Limited which was sold as part of the print business to dmg media Limited on 17 th October 2020.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

14. Other financial assets and liabilities

Trade and other receivables 202 0 20 19 £’000 £’000

Trade receivables 8,636 11,531 Allowance for doubtful debts (523) (234)

8,113 11,297 Prepayments 1,604 2,102 Other debtors and accrued income 3,057 3,662

4,661 5,764

Total current trade and other receivables 12,774 17,061

Non-current receivables 477 -

Total trade and other receivables 13,251 17,061

Net trade receivables

Trade receivables net of credit loss allowance is £8.1 million (2019: £11.3 million). The average credit period taken on sales is 35 days (2019: 38). No interest is charged on the receivables. The Group measures the loss allowance for trade receivables at an amount equal to lifetime expected credit loss (“ECL”). The ECL on trade receivables are estimated using a provision matrix by reference to past default experience of the debtor and analysis of the debtor’s current financial position, adjusted for factors that are specific to the debtors, general economic conditions of the industry (including the impact of COVID-19) in which the debtors operate and an assessment of both the current as well as the forecast direction of conditions at the reporting date.

Before accepting any new credit customer, the Group obtains a credit check from an external agency to assess the potential customer’s credit quality and then defines credit terms and limits on a by-customer basis. These credit terms are reviewed regularly. In the case of one-off customers or low value purchases, pre-payment for the goods is required under the Group’s policy. The Group reviews trade receivables past due but not impaired on a regular basis and considers, based on past experience, that the credit quality of these amounts at the period end date has not deteriorated since the transaction was entered into and so considers the amounts recoverable.

202 0 2019 Movement in the allowance for doubtful debts £’000 £’000

Balance at the beginning of the period 234 400 Bad debts provided for 400 17 Utilisation (101) (132) Transfer to former group company (10) (125)

Credit note provision transfer - 74

Movement in the period 289 (166)

Balance at the end of the period 523 234

Ageing of impaired receivables 202 0 20 19 £’000 £’000

Current 109 11 <30 days 25 17 30 – 60 days 9 29 60 – 90 days 145 41 90 – 150 days 52 64 150+ days 18 3 72

523 234

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

14. Other financial assets and liabilities (continued)

In determining the recoverability of a trade receivable, the Group considers any change in the credit quality of the trade receivable from the date credit was initially granted up to the balance sheet date. The concentration of credit risk is limited due to the customer base being large and unrelated, with the exception of the Mediaforce companies who following the acquisition by National World are now related parties. Accordingly, the Directors believe that there is no further credit provision required in excess of the allowance for doubtful debts.

Non-current receivables include deposits on leasehold properties (£0.3 million) and supplier deposits of (£0.2 million).

Cash and cash equivalents 202 0 20 19 £’000 £’000

Cash and cash equivalents 472 16,552 Restricted cash 1 - 2,500

Total cash and cash equivalents 472 19,052

1 The £2.5 million of cash was held in a separate Lloyds Bank Plc account secured under a “Deposit Agreement” as security for the BACS facility. This was repaid in December 2020. £1.5 million of cash is held in a separate Barclays Bank Plc account in the name of JPIMedia Publishing Limited but has been derecognised as an asset as described in the Commitments Note 24.

Trade and other payables 202 0 20 19 £’000 £’000

Trade creditors 1,761 2,591 Accruals 5, 440 5,829 VAT 2,379 1,651 Social security and PAYE 1,151 1,338 Deferred revenue 2,734 2,230

Other creditors 307 1,144

JPIMedia Limited 1 4,717 -

Working capital contributions payable to JPIMedia Publications Limited - 2,200

Total trade and other payables 18,489 16,983

1 Balance payable to the former parent company JPIMedia Limited represents the amount outstanding at 2 January 2021 and was repaid on 4 January 2021.

Trade creditors and accruals principally comprise amounts outstanding for trade purchases and ongoing costs.

VAT includes £1.245 million of deferred VAT due to Government concessions in relation to COVID-19, which the Group will commence repaying to HMRC from March 2021.

The Directors consider that the carrying amounts of trade and other payables at the balance sheet date approximate to their fair value.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

15. Contract assets and liabilities

Contract assets (accrued income) primarily relate to the Group's right to consideration for work completed but not billed at the reporting date. Contract liabilities (deferred income) primarily relate to the consideration received from customers in advance of transferring a good or service. The following table presents the significant movements in the period for both contract assets and liabilities: Contract Contract asset liability £’000 £’000 At acquisition of trading business 3,052 (2,622) Decrease due to balance transferred to trade receivables (3,052) - Increases due to revenue recognised in period 1,980 - Decreases due to revenue recognised in the period - 2,542 Increase due to cash received - (2,150) At 4 January 2020 1,980 (2,230) Decrease due to balance transferred to trade receivables (1,980) - Increases due to revenue recognised in period 1,989 - Decreases due to revenue recognised in the period - 1,571 Increase due to cash received - (2,075) At 2 January 2021 1,989 (2,734)

For instances where the performance obligation has been fulfilled, but the customer has not yet been billed, revenue is recognised and a contract asset is recognised. The contract asset is released once a sales invoice has been issued. The largest accrued income balance is with regards to newspaper circulation revenue for the last week of the period, which was billed after the period end.

Where a performance obligation has not been fulfilled but cash has been received for the service provided, revenue is deferred and a contract liability is recognised. Once the performance obligation has been fulfilled, the contract liability is released and the revenue is recognised. Where cash is received in advance for a newspaper sales subscription, a contract liability is recognised until such a time as the performance obligation is fulfilled. Where cash is received in advance for advertising, a contract liability is recognised until such a time as the performance obligation is fulfilled and the sales invoice is raised.

16. Intercompany balances

JPIMedia Publishing Limited and its subsidiaries were part of the JPIMedia Holdings Limited Group until 2 January 2021 (see Note 25 for further details).

At 2 January 2021, the Group and Company had the following intercompany balances payable. Amounts owed are unsecured, interest free, have no fixed date of repayment and are repayable on demand.

Intercompany balances at 2 January 2021 JPIMedia Publishing Group JPIMedia Publishing Ltd £’000 £’000 JPIMedia Off Road Limited - (10) Total intercompany payable - (10)

At 4 January 2020, the Group and the Company had the following intercompany balances receivable and payable.

Intercompany balances at 4 January 2020 JPIMedia Publishing Group JPIMedia Publishing Ltd £’000 £’000 Intercompany receivable 8,829 8,829 Intercompany payable (87,621) (50,124) Net intercompany liability (78,792) (41,295)

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

17. Leases

The Group lease office buildings and motor vehicles to be used in its operations. Leases of offices generally have terms between 2 and 10 years, with longer period leases having a break clause after year 5. Vehicles generally have a term of 4 years and are principally utilised by the sales, editorial and IT departments. With the exception of short term leases and leases of low value underlying assets, each lease is reflected on the balance sheet as a right of use asset and a lease liability.

Carrying value of right of use assets The carrying value of right of use assets recognised and the movements during the year are set out below:

Property and buildings Motor Vehicles Total £’000 £’000 £’000 At 4 January 2020 - - - Change in accounting policy – initial application of IFRS 16 3,730 807 4,537 At 5 January 2020 3,730 807 4,537 Additions - 60 60 Depreciation charge (1,097) (324) (1,421) At 2 January 2021 2,633 543 3,176

Carrying value of lease liabilities The carrying amounts of lease liabilities and the movements during the year are set out below:

Property and buildings Motor Vehicles Total £’000 £’000 £’000 At 4 January 2020 - - - Change in accounting policy – initial application of IFRS 16 3,588 836 4,424 At 5 January 2020 3,588 836 4,424 New leases - 60 60 Interest charge 246 58 304 Lease payments (1,237) (372) (1,609) At 2 January 2021 2,597 582 3,179

2 January 5 January 2021 2020 £’000 £’000

Current liabilities 1,353 1,245

Non-current liabilities 1,826 3,179

Total 3,179 4,424

The Group has elected not to recognise a lease liability for short term leases (leases with an expected term of 12 months or less) or for leases of low value assets (less than £4,000). Payments made under such leases are expensed on a straight-line basis. In addition, certain variable lease payments are not recognised as lease liabilities and are expensed as incurred.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

17. Leases (continued)

Amounts recognised in profit and loss The following amounts are recognised in the loss for the year: 202 0 £’000

Depreciation of right of use assets 1,421

Interest expense 304

Expenses relating to short term and low value assets not included in lease liabilities 602

Total 2,327

18. Retirement benefit obligation

The Group contributes to two defined contribution schemes: the JPIMedia Retirement Savings Plan, a defined contribution master trust; and The Scotsman Stakeholder Pension plan. Both plans are administered by Scottish Widows. In the period employer contributions range from 3% of qualifying earnings for employees statutorily enrolled, through to 12% of basic salary for Senior Executives. The amount due to be paid into these schemes at the balance sheet date is £315,000 (4 January 2020: £381,000). Refer to Note 7 for full employee salary details.

19. Deferred tax

Under IFRS, deferred tax is calculated at the tax rate that has been enacted or substantively enacted at the balance sheet date. The corporation tax rate of 19%, substantively enacted by parliament and applicable for the year beginning 1 April 2020, has been used to calculate the deferred tax liability for the period ending 2 Jan 2021. The rate of 17% was used to calculate the deferred tax liability for the prior period, as this was the enacted rate applicable for that reporting period.

The following are the major deferred tax assets and liabilities recognised by the Group and movements thereon during the current and prior reporting periods.

Accelerated tax Intangible Tax losses depreciation assets Total £’000 £’000 £’000 £’000

Opening Balance - - (3,596) (3,596) Credit to Income Statement 1,118 (130) 495 1,483 At 4 January 2020 1,118 (130) (3,101) (2,113)

Credit to Income Statement (733) 120 2,974 2,361

Increase in deferred tax rate to 19% 132 (15) (365) (248)

At 2 January 2021 517 (25) (492) -

Certain deferred tax assets and liabilities have been offset. The following is an analysis of the deferred tax balances (before offset) for financial reporting purposes.

202 0 20 19 £’000 £’000

Deferred tax liabilities (517) (3,231) Deferred tax assets 517 1,118 Net deferred tax asset/(liability) - (2,113)

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

19. Deferred tax (continued)

A £0.5 million deferred tax asset has been recognised regarding carry forward tax losses. No deferred tax asset has been recognised in respect of the net accumulated amounts carried forward, totalling £3.9 million (2019: £nil), (available for offset against future taxable profits) as there is uncertainty regarding the timing of when these amounts will be recovered and agreement with former parent to utilise losses for their Group:

2020 20 19 £’000 £’000

Tax losses – unrecognised deferred tax asset 3,8 87 - Total 3,8 87 -

20. Provisions Licence to Occupy Onerous IT contracts arrangements Dilapidations Total £’000 £’000 £’000 £’000

Acquired on 17 November 2018 - 223 - 223 Additional provision in the period 138 - 500 638 Utilisation of provision (133) (219) - (352) Release of provision - (4) - (4)

At 4 January 2020 5 - 500 505

Release of provision (5) - - (5) At 2 January 2021 - - 500 500

Non-current provisions - - 500 500

Total provisions - - 500 500

Onerous IT contracts

Short term onerous IT licence provisions arising from business reorganisations. The provision has been released in full during the current period.

Licence to occupy arrangements

This provision related to onerous costs associated with licence to occupy arrangements on under occupied properties which have since been disposed of.

Leasehold property dilapidations provision

The provision for leasehold dilapidations relates to the contractual obligations to reinstate leasehold properties to their original state at the lease expiry date. The Group has assessed the entire portfolio and made provisions depending on the state of the property and the duration of the lease and likely rectification requirements. During 2020 there were no changes to the property portfolio that necessitated an amendment to the dilapidations provision. No new IFRS 16 leases or other licence to occupy agreements have been entered into that require an end of lease/licence dilapidation provision to be made. There were also no changes of circumstances in the properties that have an existing dilapidation provision that have changed the management view on the level of the current provision held.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

21. Share capital and share premium Number of shares Ordinary Shares Share premium ‘000 £’000 £’000

Authorised, issued and fully paid up At Incorporation Shares issued ––– At 4 January 2020 –––

Shares issued 1 – 55,978

At 2 January 2021 1 – 55,978

On 3 August 2018, the date of incorporation for JPIMedia Publishing Limited, 1 ordinary share with a nominal value of £0.01 was allotted.

On 2 January 2021, 1,000 ordinary shares with nominal values of £0.01 each were allotted as part of the acquisition of the business by National World. This resulted in a share premium balance of £56 million.

The ordinary shares are not redeemable. Each ordinary share ranks equally for any dividend declared and distributions made on winding up on the Company. Each ordinary shareholder is entitled to one vote for one share held and shares rank equally for voting purposes.

The Company has one class of ordinary shares which carry no right to fixed income. No dividends were paid during the period (2019: £Nil).

22. Reserves 2020 20 19 £’000 £’000

Share premium account 55,978 – Profit and loss account (48,825) (17,664) 7,153 (17,664)

Profit and loss account represents cumulative losses.

23. Notes to the Cash Flow Statement 202 0 20 19 Notes £’000 £’000

Loss for the period (33,004) (19,308)

Adjustments for: Impairment of intangible assets 11 24,521 891 Impairment of goodwill 10 - 13,642 Write-off of tangible assets 12 522 - Amortisation of intangible assets 11 7,276 7,491 Depreciation charges 12, 17 2,296 790 Profit on disposal of property, plant and equipment - 1 1,611 3,507 Movement in provisions (5) 282 Increase in inventories (16) - Decrease in receivables 3,669 9,193 Increase in payables 1,521 11,943 Cash generated from operations 6,780 24,925

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

23. Notes to the Cash Flow Statement (continued)

Cash and cash equivalents (which are presented as a single class of assets on the face of the Statement of Financial Position) comprise cash at bank.

Changes in liabilities arising from financing activities

The table below details changes in the Group’s liabilities arising from financing activities, including both cash and non-cash changes. Liabilities arising from financing activities are those for which cash flows are, or future cash flows will be, classified in the Group’s Consolidated Cash Flow Statement as cash flows from financial activities.

Note 4 January Cash inflow from Cash outflow on Non-cash 2 January 2020 issue of debt repayment of debt movements 2021 £’000 £’000 £’000 £’000 £’000 Leases 17 - - (1,609) 4,788 3,179 Total liabilities from financing activities - - (1,609) 4,788 3,179

24. Commitments, guarantees and contingent liabilities

Licence to occupy

On 17 November 2018, the JPIMedia Holdings Limited Group purchased the trading business and assets of Johnston Press plc. As part of the acquisition, JPIMedia Publishing Limited entered into Licence to Occupy arrangements with the administrators of Johnston Press plc for various leased or licenced properties. Several of the properties were significantly under occupied and their licences to occupy were terminated. Of the remaining properties, several were converted to operating leases (now classified as leases under IFRS 16), however the majority are simple short-term leases (ending within 12 months) or with short-break notices available and do not meet the requirements to be classified under IFRS 16. The rent payable for these properties is expensed as incurred. During the current period £0.7 million was expensed (2020: £2.0 million). The licence to occupy future committed spend is as follows:

<12 m on ths £’000

Licence to occupy future commitments 98

Contingent liabilities and securities

JPIMedia Publishing Limited is subject to a registered charge by Barclays Bank PLC relating to £1.5 million of funds held by the Bank. These funds are not held in the Company balance sheet as the terms of the Share Purchase Agreement with National World dated 2 January 2021 specify these funds are held for the ultimate benefit of JPIMedia Limited. Funds are repayable directly to JPIMedia Limited on the earlier of either the release of the security by the Bank or 18 months from the Group’s acquisition by National World.

On 17 November 2018 the Group led by JPIMedia Holdings Limited together with its subsidiaries entered into a Note Purchase Agreement with Global Loan Agency Services Limited (as Agent), GLAS Trust Corporation Limited (as Security Agent) and various institutions, as a condition of which it (and each relevant member of its group) granted security over all of its assets (subject to certain specified exceptions). As part of the acquisition by National World on 2 January 2021, the charges over the assets held be GLAS Trust Corporation Limited (As Security Agent) for the JPIMedia Holding Group were released.

The Group and the Company has no known material contingent liabilities as at 2 January 2021.

25. Related party transactions

The Company and its subsidiaries formed part of the JPIMedia Holdings Limited Group until 2nd January 2021 when the Company and its subsidiaries were acquired by National World. Transactions between members of the JPIMedia Holdings Limited Group, up to the date of the disposal, are not disclosed where the transactions were between two wholly owned subsidiaries. The Group has trade with related parties in the normal course of operations.

Ultimate controlling party

On 2nd January 2021, National World acquired JPIMedia Publishing Limited and its subsidiaries, from the former parent entity JPIMedia Limited. National World now holds 100% of the issued ordinary shares of the Company. There were no transactions with National World during 2020. In January 2021, National World provided a working capital facility of £10.5 million to the Group to enable the Group to repay £4.7 million of debt due to the former parent undertaking JPIMedia Limited and for £5.8 million of working capital to meet the day-to-day liquidity to fund the Group’s operations.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

25. Related party transactions (continued)

Transactions with former JPIMedia Holdings Limited group subsidiaries

On 17th October 2020, JPIMedia Limited disposed of JPIMedia Print Holdings Limited and its subsidiaries to dmg media Limited. As part of the sale, a business services agreement ("BSA") was entered into between the Group and JPIMedia Print Holdings Limited ("Print") to provide certain services to Print on a transitional basis, initially for a six month period. The Group processed the payroll for Print until 1st January 2021. Sundry income of £0.1 million has been recognised by the Group regarding this agreement (2019: £Nil). The Group had a £0.1 million receivable at 2 January 2021, in relation to cost recharges, which has been recovered from Print after the period end.

On 29th November 2019, JPIMedia Limited disposed of JPIMedia Publications Limited (“Publications”) to dmg media Limited. A BSA was entered into between the Group and Publications to provide certain services to Publications on a transitional basis. The BSA ended in June 2020. In the current period, the Group recognised £0.3 million (2019: £0.1 million) of sundry income relating to this agreement. The Group had a £0.1 million payable at 2 January 2021 in relation to newspaper subscription cash collections, which has been remitted to Publications after the period end.

Director related transactions

The aggregated transactions which are considered to be material are:

2020 2019 £’000 £’000

Sales --

Purchases 404 610

JPIMedia Holdings Limited paid £404,000 (2019: £610,000) in consultancy fees to a company in which a Director (who resigned on 2 January 2021) has an interest, for services rendered to JPIMedia Holdings Limited, the former ultimate parent of JPIMedia Publishing Limited. Under the terms of the agreement amounts paid were as follows:

• £242,000 Success Fee for the completion of the disposal of JPIMedia Print Holdings Limited and JPIMedia Publishing Limited. (2019: £430,000 success fee for the completion of JPIMedia Publications Limited disposal). • £162,000 in relation to support on strategic and operational matters to address structural challenges, paid as a monthly retainer. (2019: £180,000).

At 2 January 2021, the balances outstanding in relation to these related parties amounted to £nil (2019: £15,000).

The remuneration of the Directors of the Company is set out in aggregate in Note 7.

Other related parties

Following the acquisition of the Company by National World plc, the Mediaforce companies are a related party as Mediaforce (Holdings) Limited own £6.0 million of convertible secured loan notes issued by National World plc.

26. Financial instruments

Capital risk management

The capital structure of the Group consists of cash and cash equivalents (Note 14) and equity attributable to equity holders of the parent, comprising issued share capital, reserves and retained earnings as disclosed in Notes 21 and 22, and in the Group Statement of Changes in Equity.

Categories of financial instruments 202 0 20 19 £’000 £’000

Financial assets (current and non-current) Trade and other receivables 11,647 14,959 Cash and cash equivalents 472 19,052

Financial liabilities (current and non-current) Trade and other payables (11,038) (14,753)

Each of the financial instruments identified are measured at amortised cost 44

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

26. Financial instruments (continued)

The component parts of trade and other receivables are presented in Note 14 but excludes prepayments. The component parts of trade and other creditors are presented in Note 14, but excludes deferred income and amounts payable to JPIMedia Limited.

Financial risk management objectives

The Group’s treasury function supports the business and, with the Group’s finance department, monitors and manages the financial risks relating to the operations of the Group through assessment of the exposures by degree and magnitude of risk. These risks include market risk, credit risk, and liquidity risk.

Market risk

The Group is not exposed to interest rate risk as it has no external borrowings and funding by its parent, National World, is interest free. The Group’s activities do expose it to the financial risk of changes in foreign currency exchange, but this is not considered to be material.

At a Group and Company level, market risk exposures are assessed using sensitivity analyses.

Foreign currency risk management

The Group undertakes certain operational transactions denominated in foreign currencies, hence exposures to exchange rate fluctuations arise.

The carrying amounts of the Group’s foreign currency-denominated monetary assets and monetary liabilities at the reporting date are as follows:

Liabilities Assets 202 0 20 19 202 0 20 19 £’000 £’000 £’000 £’000

Euro Trade receivables – – 6 10 Cash and cash equivalents – – 6 116 Trade payables (10) (16) – –

US dollar Cash and cash equivalents – – 1 106 Trade payables (31) (100) – –

Foreign currency sensitivity

The following table details the Group’s sensitivity to a 5% change in pounds sterling against the euro and a 5% change in pounds sterling against the US dollar. These percentages are the rates used by management when assessing sensitivities internally and represent management’s assessment of the possible change in foreign currency rates.

The Group does not hedge the euro income, deposits or trade payables because the risk of foreign exchange movements is not deemed to be significant.

The sensitivity analysis of the Group’s exposure to foreign currency risk at the reporting date has been determined based on the change taking place at the beginning of the financial year and held constant throughout the reporting period. A positive number indicates an increase in profit or loss and other equity where pounds sterling strengthens against the respective currency. For a 5% weakening of sterling against the relevant currency, there is an equal and opposite impact on profit or loss and other equity, and the balances below would reverse signs.

Euro currency impact US dollar currency impact 202 0 20 19 202 0 20 19 5% strengthening of pounds sterling (£) £’000 £’000 £’000 £’000

(Loss)/Profit – (5) 2 –

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

26. Financial instruments (continued)

Credit risk management

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group has adopted a policy of only dealing with creditworthy counterparties as a way of mitigating the risk of financial loss from defaults. The Group’s policy on dealing with trade customers is described in Note 14.

The Group’s exposure and the credit ratings of its counterparties are continuously monitored. As far as possible, the aggregate value of transactions is spread across a number of approved counterparties.

Trade receivables consist of a large number of customers spread across diverse industries and geographical areas. Ongoing credit evaluation is performed on the financial condition of accounts receivable.

The Group does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics, the latter being defined as connected entities, other than with some of the larger advertising agencies. In the case of the latter, a close relationship exists between the Group and the agencies and appropriate allowances for doubtful debts are in place. The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are banks with high credit ratings assigned by international credit-rating agencies.

The following table shows the total estimated exposure to credit risk for all of the Group’s financial assets, excluding trade receivables which are discussed in Note 14: 202 0 2019 Carrying value Exposure to credit risk Carrying value Exposure to credit risk £’000 £’000 £’000 £’000

Cash and cash equivalents 472 – 19,052 –

Liquidity risk management

Liquidity risk results from having insufficient financial resources to meet day-to-day fluctuations in working capital and cash flow. Ultimate responsibility for liquidity risk management rests with the Board. The Group manages liquidity risk by maintaining adequate reserves and banking facilities, by continuously monitoring forecast and actual cash flows and by matching the maturity profiles of financial assets and liabilities. Additionally, the parent company are committed to provide funding to the Company as necessary, and as described in Note 27.

The contractual maturities (representing undiscounted contractual cash flows) of financial liabilities, being trade and other payables, are as follows:

2020 2019 £’000 £’000

<3 months 9,303 13,941 3 – 12 months 1,622 812 1 – 2 years 113 - >2 years - - 11,038 14,753

27. Events after the reporting period

In January 2021, National World, the new ultimate parent, provided a working capital facility of £10.5 million to the Group to enable the Group to repay £4.7 million of debt due to the former parent undertaking JPIMedia Limited and £5.8 million of working capital to meet the day-to-day liquidity to fund the Group’s operations.

28. Effects of changes in accounting policies

The Group adopted IFRS 16 Leases with a transition date of 5 January 2020, but has chosen not to restate comparatives for the prior reporting period as permitted under the specific transitional provisions in the standard. The reclassifications and adjustments arising from the new standard are recognised in the opening balance sheet as at 5 January 2020.

Impact on the balance sheet The new standard has been applied using the modified retrospective approach, with the cumulative effect of adopting IFRS 16 being recognised in equity as an adjustment to the opening balance of retained earnings for the current period. The change in accounting policy affected the following items in the balance sheet on 5 January 2020: 46

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

28. Effects of changes in accounting policies (continued)

Increase/ Decrease £’000

Right of use assets Increase 4,537

Prepayments Decrease (141)

Payables Decrease 15

Lease liabilities Increase (4,424)

The net impact on retained earnings on 5 January 2020 was a decrease of £13,000.

Lease liabilities On adoption of IFRS 16 the Group recognised lease liabilities in relation to leases previously classified as ‘operating leases’ under the principles of IAS 17 Leases. These liabilities were measured at the present value of the remaining lease payments, discounted using the lessee’s incremental borrowing rate as of 5 January 2020.

The lease liabilities at 2 January 2021 and 5 January 2020 were as follows:

2 January 5 January 2021 2020 £’000 £’000

Current liabilities 1,353 1,245

Non-current liabilities 1,826 3,179

Total 3,179 4,424

Lease liabilities recorded at 5 January 2020 can be reconciled to operating lease disclosures as at 4 January 2020 as follows:

£’000

Operating lease commitments as at 4 January 2020 6,276

(Less) Short term and low value leases recognised on a straight-line basis as expense (403)

(Less) Licence to occupy costs recognised on a straight-line basis as expense (566)

(Less) Variable expenses relating to leases and prepayments (276)

Operating lease liabilities before discounting 5,031

Effect of discounting (638)

Recognition of lease extension options 31

Lease liability recognised as at 5 January 2020 4,424

Right of use assets Right of use assets were measured at the amount equal to the lease liability, adjusted by the amount of prepaid or accrued lease payments relating to leases and dilapidations assets recognised in the balance sheet at 4 January 2020. There were no onerous lease contracts that would have required an adjustment to the right of use assets at the date of initial application.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

28. Effects of changes in accounting policies (continued)

The recognised right of use assets relate to the following types of assets: 2 January 5 January 2021 2020 £’000 £’000

Property and buildings 2,633 3,730

Motor vehicles 543 807

Total 3,176 4,537

Impact on the income statement For the period ended 2 January 2021, operating loss was £188,000 higher as a result of applying IFRS 16 due to a portion of the lease expense now being recorded as interest expense. Profit before tax was £116,000 lower due to interest expenses being higher at the beginning of the lease term. EBITDA has been positively impacted as lease expenses previously classified as operating expenses are now recognised as a combination of depreciation and interest costs. During the period £1.4 million of depreciation and £0.3 million of interest expense on IFRS 16 leases has been recognised, instead of a £1.6 million charge for operating lease expenses.

Impact on the cash flow statement Payments in respect of leases which were previously recognised with cash flows from operating activities are now recorded within cash flow from financing activities, separated between payment of interest and payment of principal elements. This has increased net cash generated from operations and increased net cash used in financing activities by £1.5 million.

Judgements and estimates Extension and termination options are included in a number of property leases. These terms are used to maximise operational flexibility in terms of managing contracts. The extension and termination options held are exercisable only by the Group and not by the respective lessor. In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated). Potential gross future cash flows of £4.2 million have not been included in the lease liability because it is not reasonably certain that the leases will be extended (or not terminated).

The assessment is reviewed if a significant event or a significant change in circumstances occurs which affects this assessment and that is within the control of the lessee. During the current year, there were no leases where this assessment was changed.

29. Statutory to adjusted operating (loss) / profit

To provide clarity of the underlying trading performance of the Group, the operating results are presented on statutory and adjusted basis. Adjusted results non-recurring restructuring and organisational charges, transaction costs, amortisation of intangible assets and impairment charges. The Directors believe that it is appropriate to additionally present the Alternative Performance Measures used by management in running the business, and that it will present a more meaningful and comparable financial result.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

29. Statutory to adjusted operating (loss) / profit (continued)

The adjusted results provide supplementary analysis of the ‘underlying’ trading of the Group.

2020 2019 Note £m £m

Statutory operating loss (2020 52 weeks; 2019 74 weeks) (33.0) (19.3) Adjustments: Remove 2018 trading period loss (from 17th November 2018 to 4th Jan 2019) a - (0.9) Continuity of supply payments b - 6.1 Restructuring, redundancy and reorganisation costs c 3.5 5.4 Gain on sale of investment d - (1.9) Transaction fees e 1.0 0.5 Derecognition of restricted cash f 1.5 - Impairment of goodwill g - 13.6 Impairment of intangibles h 24.5 0.9 Write off of fixed assets i 0.5 - Subscription revenue – fair value adjustment j - 0.2 Other exceptional costs k 0.1 0.4 IFRS 16 application: add back operating lease costs l - 0.7 IFRS 16 application: depreciation l - (0.6) Adjusted operating (loss)/profit (1.9) 5.1

Notes a) Remove 2018 trading period loss The prior period statutory accounts are for a period of 74 weeks, the trading loss for the first 22 weeks (of which only 15 weeks were trading) has been removed to provide a 52 week comparative adjusted operating profit/(loss). b) Continuity of supply payments During 2019, continuity of supply payments were made to key suppliers subsequent to the 17 November 2018 acquisition, to ensure uninterrupted supplies of goods and services which management chose to pay in order to continue normal operations and revenue generation. c) Restructuring and redundancy costs Restructuring and redundancy-related costs are material and incurred to transform and restructure the business cost base resulting in a reduction in headcount. Adjustments for redundancy costs do not include those incurred in the ordinary course of business which are treated as operating costs and may lead to a direct replacement being appointed.

Restructuring and redundancy costs includes £3.2 million of redundancy costs and £0.3 million editorial and advertising transformation costs (2019: £5.4 million total comprises £3.0 million redundancy, £1.8 million editorial and advertising transformation costs, and £0.6m of property restructuring costs). d) Gain on sale of investment In August 2019, the Company sold its investment in JPIMedia 2018 Limited to JPIMedia Limited and recorded a £1.9 million gain on sale in its Income Statement. e) Transaction fees Transaction costs includes retention bonus accrual for senior management of £0.6 million (2019: £0.3 million), and intercompany balance write- offs of £0.4 million (2019: £0.2 million). These costs are directly linked to the aborted disposal in 2019, or to disposals of former group subsidiaries by JPIMedia Limited. f) Derecognition of restricted cash Under the terms of the Share Purchase Agreement between JPIMedia Limited and National World, £1.5 million restricted cash held by JPIMedia Publishing Limited on account with Barclays Bank plc has an undertaking by Barclays. Upon release of the security by Barclays, or 18 months following the completion of the acquisition by National World on 2 January 2021, a sum of £1.5 million is repayable to JPIMedia Limited. Therefore, the cash balance has been derecognised as an asset as at the reporting period-end. g) Impairment of goodwill Goodwill was written off following the impairment review of the Group’s identifiable CGU, refer to Note 11 for further information.

JPIMEDIA PUBLISHING GROUP

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

29. Statutory to adjusted operating (loss) / profit (continued) h) Impairment of intangibles A review of the carrying value of intangible assets concluded an impairment of £24.5 million to the carrying value of intangible assets and the release of £2.1 million deferred tax creditor. Refer Notes 11 and 19 for further details. i) Write off of fixed assets Land and buildings freehold assets were written off in the current period as JPIMedia Publishing Limited does not hold legal title to the property (£0.3 million). Fixtures and fitting with a value of £0.3 million were also written off in the current period. j) Subscriptions revenue – fair value adjustment In accordance with IFRS 3, the Company recognised an opening balance sheet adjustment for the service obligation to fulfil newspaper sales subscriptions of £0.2 million. This is deemed a one-off statutory adjustment by management. This amount is included within the Newspaper Sales revenue line of the Income Statement. k) Other exceptional costs Other costs include £0.2 million of libel settlement costs (2019: £0.2 million), offset by minor credit adjustments relating to the prior period. During 2019, strategic review costs of £0.2 million were incurred on professional advisory fees following the acquisition of the principal assets and business of Johnston Press Plc (now dissolved). l) IFRS 16 application For comparability the prior period result has been adjusted to include the effect of IFRS 16, including the removal of the cost of operating leases which have subsequently transitioned to IFRS 16 (£0.7 million) and the inclusion of £0.6 million of depreciation.

EBITDA and adjusted EBITDA are: 2020 2019

£m £m

Statutory operating loss (33.0) (19.3)

Depreciation and amortisation 9.6 8.3

Impairment of intangible assets 24.5 14.5

EBITDA 1.1 3.5

Adjusted operating (loss)/profit (1.9) 5.1

Depreciation and amortisation 9.6 8.3

Adjusted EBITDA 7.7 3.4

JPIMEDIA PUBLISHING LIMITED

COMPANY INCOME STATEMENT FOR THE PERIOD ENDED 2 JANUARY 2021

52 weeks to 74 weeks to 2 January 2021 4 January 2020 Restated 1 Notes £’000 £’000 Revenue 4 88,164 131,050 Cost of sales (64,325) (94,773) Gross profit 23,839 36,277

Distribution costs (4,730) (7,791) Administrative expenses (20,182) (21,782) Exceptional items: Impairment of goodwill 1 35 - (10,062) Impairment of investment in subsidiaries (32,305) - Restructuring and other 31 (2,225) (3,722) Write off fixed assets 12 (522) - Gain on sale of investment 5 - 1,900 Release of restricted cash 5 (1,500) - Continuity of supply payments 5 - (6,076)

Operating loss 31 (37,625) (11,256)

Finance income 8 47 161 Finance costs 8 (304) - Loss before taxation (37,882) (11,095)

Tax on loss 34 - -

Loss for the financial period (37 ,88 2) (11 ,09 5)

1 Details of the prior period restatement are provided in Note 30.

The current period’s results have been derived wholly from continuing operations.

The accompanying notes are an integral part of these Financial Statements.

JPIMEDIA PUBLISHING LIMITED

COMPANY STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD ENDED 2 JANUARY 2021

52 weeks to 74 weeks to 2 January 4 January 2021 2020 Restated 1 £’000 £’000

Loss for the period 1 (37,882) (11,095) Other comprehensive income - - Total other comprehensive income for the period --

Total comprehensive loss for the period attributable to the owners of the Company (37,882) (11,095)

1 Details of the prior period restatement are provided in Note 30.

The current period’s results have been derived wholly from continuing operations.

The accompanying notes are an integral part of these Financial Statements.

JPIMEDIA PUBLISHING LIMITED

COMPANY BALANCE SHEET AS AT 2 JANUARY 2021

As at As at 2 January 2021 4 January 2020 Restated 1 Notes £’000 £’000 Non-current assets Intangible assets 11 5,621 9,186

Tangible assets 12 1,43 8 2,389

Investments 36 5, 19 2 –

Right of use assets 17 3,176 -

15,427 11,575

Current assets Trade and other receivables 14 13,251 17,061 Intercompany receivable 16 - 8,829

Inventory 13 16 -

Cash and cash equivalents 14 472 19,052

13,739 44,942

Total assets 29,166 56,517

Current liabilities

Trade and other payables 14 (18,489) (16,983)

Intercompany payable 16 (10) (50,124)

Leases 17 (1,353) -

Provisions 20 - (5)

(19,852) (67,112)

Non-current liabilities

Leases 17 (1,826) -

Provisions 20 (500) (500)

Deferred tax 37 --

(2,326) (500)

Total liabilities (22,178) (67,61 3)

Net assets/(liabilities) 6,988 (11,095)

Capital and reserves Share premium 21 55,978 -

Retained losses 1 (48,990) (11,095)

Shareholders’ equity 6,988 (11,095)

1 Details of the prior period restatement are provided in Note 30.

JPIMEDIA PUBLISHING LIMITED

COMPANY BALANCE SHEET AS AT 2 JANUARY 2021

The current period’s results have been derived wholly from continuing operations. The accompanying notes are an integral part of these Financial Statements.

The Financial Statements of JPIMedia Publishing Limited, registered in England and Wales (number 11499982), were approved by the Board of Directors and authorised for issue on 22 April 2021. They were signed on its behalf by:

V Vaghela Director

JPIMEDIA PUBLISHING LIMITED

STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 2 JANUARY 2021

Share Capital Share premium Retained earnings Total Note £’000 £’000 £’000 £’000

Equity as at 4 January 2020 – – (11,095 ) (11,095)

Change of accounting policy 2 28 –– (13) (13)

Equity as at 5 January 2020 –– (11,108) (11,108)

Loss for the period – – (37,882) (37,882)

Other comprehensive loss for the period –– – –

Total comprehensive loss for the period – – (37,882) (37,882)

Contributions by and distributions to owners:

Issue of share capital – 55,978 – 55,978

Total contributions by and distributions to owners 21 – 55,978 – --

Equity as at 2 January 2021 – 55,978 (48,990 ) 6,988

Retained earnings Total Share Capital Share premium Restated 1 Restated 1 Note £’000 £’000 £’000 £’000

Opening balances on incorporation –– – –

Loss for the period 1 – – (11,095 ) (11,095) Other comprehensive loss for the period –– – –

Total comprehensive loss for the period – – (11,095 ) (11,095)

Contributions by and distributions to owners:

Issue of share capital –– – –

Total contributions by and distributions to owners –– – --

Equity as at 4 January 2020 – – (11,095 ) (11,095)

1 Details of the prior period restatement are provided in Note 30.

2 Adoption of IFRS 16 Leases is detailed in Note 28.

The accompanying notes are an integral part of these Financial Statements.

JPIMEDIA PUBLISHING LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

30. Significant accounting policies

Basis of preparation

The separate Financial Statements of the Company have been prepared in accordance with Financial Reporting Standard 101 ‘Reduced Disclosure Framework’ (FRS101). The Financial Statements have been prepared under the historical cost convention and in accordance with the Companies Act 2006.

The Company is a qualifying entity under FRS 101 and has therefore taken advantage of the disclosure exemptions available to it in respect of its separate Financial Statements. The following exemptions have been taken in relation to the presentation of a cash-flow statement, capital management, financial instruments, change in accounting policy, retrospective restatement or reclassification, capital management, standards not yet effective and related party transactions. Where relevant, equivalent disclosures have been given in the Group accounts, the applicable note reference is provided.

The reporting period is for the 52 weeks ended 2 January 2021, whilst the comparative period is for 74 weeks being from date of incorporation to 4 January 2020. IFRS 16 Leases has been adopted from 5 January 2020, the impact of the adoption is disclosed in Note 28 of the Group accounts.

Restatement of prior year

The Company’s Financial Statements have been restated to reflect a change in the allocation of the £14.5 million Group impairment, of which £10.1 million has been allocated to the Company compared to £7.7 million in the prior period.

The intangible assets, including goodwill and publishing rights and titles, arose on the acquisition of the trade and assets in November 2018. The acquisition was structured as several acquisitions through the subsidiaries of JPIMedia Publishing Limited and the intangible assets were allocated to each entity based on the revenue that had been allocated to the titles acquired by each entity from the administrators of each Johnston Press entity. The allocation of intangible assets to subsidiaries has now been deemed to be incorrect as it did not reflect the consideration paid by each of the subsidiary entities and resulted in negative goodwill being created in a number of the subsidiaries. The allocation used did not consider the profitability of the publishing titles which is driven by their revenue mix (circulation and advertising) and synergies derived through the number of titles in each business, in particular if there was a leading daily title. The revenue allocation basis resulted in certain entities being allocated a higher or lower value for Publishing Rights and Titles with a consequential impact on goodwill and deferred tax associated with the unregistered titles and revisions in the amortisation and impairment charges.

The correction of the accounting treatment for intangible assets results in a change in the impairment of goodwill of £2.4 million and has been corrected retrospectively by restating the Income Statement for the period ended 4 January 2020. Comparatives have been restated as follows:

Restatement of prior year reported numbers As previously reported Restated Restatement 04 January 2020 04 January 2020 £'000 £'000 £'000 Company Income Statement Impairment of goodwill (7,676) (10,062) (2,386)

Loss for the financial period (8,709) (11,095) (2,386)

Company Balance Sheet Goodwill 2,386 - (2,386) Net liabilities and Shareholders' equity (8,709) (11,095) (2,386)

Statement of changes in equity Retained earnings balance as at 4 January 2020 (8,709) (11,095) (2,386)

Going concern

These Financial Statements have been prepared on a going concern basis. The Directors consider the use of the going concern basis of accounting appropriate, despite the declining revenues due to the coronavirus pandemic and the Company being in a net current liabilities position. Management have mitigated the impact of falling revenue through a reduction in operating costs and grants from the Government Furlough scheme. In addition, the Company’s ultimate parent, National World, has confirmed that it will provide financial support as might be necessary to ensure that the Company is a going concern for at least 12 months from the date of signing these financial statements.

Investments

Investments in subsidiaries are stated at cost less, where appropriate, provisions for impairment.

JPIMEDIA PUBLISHING LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

30. Significant accounting policies (continued)

Taxation

Current tax, including UK corporation tax and foreign tax, is provided at amounts expected to be paid (or recovered) using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the period end date where transactions or events that result in an obligation to pay more tax in the future or a right to pay less tax in the future have occurred at the period end date. Timing differences are differences between the Company’s taxable profits and its results as stated in the Financial Statements that arise from the inclusion of gains and losses in tax assessments in periods different from those in which they are recognised in the Financial Statements.

Deferred tax is measured at the average tax rates that are expected to apply in the periods in which the timing differences are expected to reverse, based on tax rates and laws that have been enacted or substantively enacted by the period end date.

Financial instruments

Financial assets and financial liabilities are recognised on the Balance Sheet when the Company becomes a party to the contractual provisions of that instrument.

Judgements in applying accounting policies

Changes in accounting estimates, errors or misstatements Determining if the 2019 allocation of the purchase price to the separate intangible assets held by the Group and the consequential impact on restating the amortisation and impairment of specific categories of assets and considering whether they were treated as errors or misstatements, or changes in estimates required judgment. The Directors considered their understanding of the individual items, the facts and circumstances surrounding each item as supported by documentary and other evidence, internal enquiries and the extent of estimation associated with each item at the end of the prior year and determined that the allocation had resulted in an error and that the prior period accounts should be restated in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Error. Further details are contained in the above section “Restatement of prior year reported numbers”.

All other accounting policies

All other accounting policies are as per Note 2 located in the Group section of this report.

31. Loss before taxation

Loss before taxation is stated after charging: 202 0 20 19 Restated 1 Notes £’000 £’000 Depreciation – tangible fixed assets 12 875 790 Depreciations – right of use assets 17 1,421 - Amortisation – intangible assets 11 4,103 3,909 Exceptional items: – Restructuring and other 2,225 3,722 – Gain on sale of investment 5 - (1,900) – Continuity of supply payments 5 - 6,076 – Impairment of goodwill 1 35 - 10,062 – Impairment of investment in subsidiaries 36 32,305 - – Derecognition of restricted cash 5 1,500 - – Write off of tangible assets 12 522 - Auditors’ remuneration – audit fees 33 291 321 Auditors’ remuneration – tax 33 81 137 Staff costs 32 24,219 30,096 Operating lease – motor vehicles - 855 Operating lease – property - 865 Expense of low value and short term leases 17 602 - Rental costs under license to occupy agreements 24 696 2,015 1 Details of the prior period restatement are provided in Note 30.

Exceptional costs – restructuring and other Restructuring and other costs primarily relate to the restructuring of the advertising and editorial departments and include redundancy and transformations costs of £2.2 million (2019: £3.7 million). Further details are included in Note 5. 57

JPIMEDIA PUBLISHING LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

32. Information regarding employees and directors

The average number of employees was: 2020 2019 Sales and distribution 322 399 Editorial and photographic 110 88 Production 98 102 Administration 96 102 626 691

Their aggregate remuneration comprised:

2020 2019 £’000 £’000 Wages and salaries 20,322 24,618 Social security costs 2,047 2,638 Other pension costs 18 1,174 1,258 Redundancy costs 676 362 Bonus costs - 1,220 Total staff costs 24, 219 30,096

£1.6 million of furlough funding was claimed from HMRC in 2020 in relation to employees of the Company.

33. Auditors’ remuneration

Crowe U.K. LLP have been appointed auditors for the current period. The analysis of Crowe U.K. LLP’s remuneration is as follows:

2020 20 19 £’000 £’000

Fees payable for the audit of the Company’s annual accounts 50 - Total audit fees 50 -

The analysis of PricewaterhouseCoopers LLP remuneration is as follows: 2020 20 19 £’000 £’000

Fees payable for the audit of the Company’s annual accounts - 20 Fees payable relating to prior year audit of the Company 41 -

Total audit fees 41 20

Non-audit services Tax compliance services 8 8 Tax advisory services 61 - Total non-audit services 69 8

Total audit and non-audit service fees 110 28

All non-audit services have been provided by PricewaterhouseCoopers LLP.

JPIMEDIA PUBLISHING LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

34. Tax on loss

The tax charge comprises: 2020 2019 Current tax on loss £’000 £’000 UK corporation tax – current period - -

Deferred tax: (Note 37) Deferred tax – current period (120) - Deferred tax - derecognised 120 - Total tax (credit)/expense on loss for the period - -

The standard rate of UK corporation tax applied to the reported loss is 19%. The difference between the total tax charge shown above and the amount calculated by applying the standard rate of UK corporation tax of 19% to the loss before tax is as follows:

2020 2019 £’000 £’000 Loss before tax (37,882) (11,095) Tax at standard UK corporation tax rate of 19% (7,197) (2,108)

Effects of: Expenses not deductible for tax purposes (388) 296 Impairment of goodwill - (1,912) Impairment of investment in subsidiaries (6,138) - Effect of difference between deferred and current tax rate - (66) Corporate interest restriction - (248) Imputed tax expense not incurred by the Company 230 376 Capital allowances higher than depreciation (58) (36) Unrecognised tax losses (869) (430) Group relief transfers (2) - Timing differences 27 (88) Tax (credit)/expense for the period - -

35. Goodwill Goodwill Restated 1

Cost Opening balance - On acquisition of subsidiaries 10,062 At 4 January 2020 10,062

Accumulated impairment losses

Opening balance -

Impairment losses for the period 1 (10,062)

At 4 January 2020 (10,062)

Carrying value at 4 January 2020 and 2 January 2021 -

1 Details of the prior period restatement are provided in Note 30.

Impairment assessment Goodwill was written off in the prior period following the impairment review of the Group’s identifiable CGU. The details of the impairment review are included within Note 11. 59

JPIMEDIA PUBLISHING LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

36. Investments in subsidiaries

2020 2019 £’000 £’000

Opening balance -- Additions 37,497 - Impairment (32,305) Closing balance 5,192 -

On 2 January 2021, JPIMedia Publishing Limited ('the Company') subscribed for a further 100 ordinary shares, each with a nominal value of £0.01, in each of nine of its subsidiaries. The subscription price totalled £37.5 million which was unpaid. Following the share subscription, the Company entered into a deed of offset and settlement with JPIMedia Limited and the nine subsidiary companies. Under this agreement the parties agreed to settle the unpaid subscription price payable by the Company to its subsidiaries, an equivalent amount of the unpaid share subscription price payable by JPIMedia Limited to the Company and the inter-company payable balances owed by the Company's subsidiaries to JPIMedia Limited.

The Company was subsequently sold to National World on 2 January 2021.

As a consequence of the impairment review across the Group, the Directors have performed an assessment of the recoverability of the investment in subsidiaries balance at 2 January 2021, and written down the investment in subsidiaries carrying value to the net assets of the subsidiary entities, which has resulted in an impairment of investments in subsidiaries in the period of £32.3 million.

The Company’s subsidiaries as at 2 January 2021 are as follows:

Proportion of Country of ownership Class of incorporation interest and share and operation voting power owned Nature of business Status

JPIMedia Scotsman Publications Limited England 100% Ordinary Newspaper publishers Agency JPIMedia SWP Limited England 100% Ordinary Newspaper publishers Agency JPIMedia North East Limited England 100% Ordinary Newspaper publishers Agency JPIMedia North West Limited England 100% Ordinary Newspaper publishers Agency JPIMedia Off Road Limited England 100% Ordinary Newspaper publishers Agency JPIMedia Yorkshire Limited England 100% Ordinary Newspaper publishers Agency JPIMedia NMSY Limited England 100% Ordinary Newspaper publishers Agency JPIMedia Midlands Limited England 100% Ordinary Newspaper publishers Agency JPIMedia South Limited England 100% Ordinary Newspaper publishers Agency JPIMedia NI Limited England 100% Ordinary Newspaper publishers Agency

The registered office of all subsidiaries is 9 th Floor, 107 Cheapside, London, EC2V 6DN, United Kingdom.

There is no difference in the proportions of ownership interest shown above and the voting power held. All investments in subsidiary undertakings are held at cost less, where appropriate, provisions for impairment. All subsidiaries have been included within the consolidated accounts.

JPIMEDIA PUBLISHING LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

37. Deferred tax

The following are the major deferred tax liabilities recognised by the Company and movements thereon during the reporting period.

Accelerated tax Tax losses depreciation Total £’000 £’000 £’000

At Incorporation - - - Credit / (charge) to income statement 1 130 (130) - At 4 January 2020 130 (130) - Effect of rate change 15 (15) - Deferred tax not recognised (120) - (120) Credit / (charge) to income statement - 120 120 At 2 January 2021 26 (26) -

1 Details of the prior period restatement are provided in Note 30.

Under IFRS, deferred tax is calculated at the tax rate that has been enacted or substantively enacted at the balance sheet date. The corporation tax rate of 19%, substantively enacted by parliament and applicable for the year beginning 1 April 2020, has been used to calculate the deferred tax liability for the period ending 2 Jan 2021. The rate of 17% was used to calculate the deferred tax liability for the prior year, as this was the enacted rate applicable for that reporting period.

No deferred tax asset has been recognised in respect of the following net accumulated amounts carried forward (available for offset against future taxable profits) as there is uncertainty regarding the timing of when these amounts will be recovered:

2020 2019 £’000 £’000 Tax losses 481 430 Tax losses – current period 869 - Total 1,350 430

38. Called-up share capital

2020 20 19 £’000 £’000

Allott ed, called-up and fully paid ––

On 3 August 2018, the date of incorporation for JPIMedia Publishing Limited, 1 ordinary share with a nominal value of £0.01 was allotted and fully paid.

On 2 January 2021, 1,000 ordinary shares with nominal values of £0.01 each were allotted and fully paid resulting in a share premium of £56 million (Note 39).

The Company has one class of ordinary shares which carry no right to fixed income. No dividends were paid during the period (2019: £Nil).

JPIMEDIA PUBLISHING LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 2 JANUARY 2021

39. Reserves 2020 20 19 £’000 Restated 1 £’000

Share premium account 55,978 – Profit and loss account 1 (48,990) (11,095) 6,988 (11,095)

1 Details of the prior period restatement are provided in Note 30.

Share premium account represents the share premium arising from the acquisition of the business by National World on 2 January 2021.

Profit and loss account represents cumulative losses.

40. Commitments, guarantees and contingent liabilities a) Value added tax The Company is registered for VAT purposes in a Group of undertakings, which share a common registration number. As a result, it has jointly guaranteed the VAT liability of the Group, and failure by other members of the Group to meet their VAT liabilities would give rise to additional liabilities for the Company. At 2 January 2021 the total liability of the Group amounted to £2.4 million (2019: £1.6 million). b) Contingent liabilities and securities The Company has no known material contingent liabilities as at 2 January 2021.

41. Immediate and ultimate parent company

JPIMedia Publishing Limited and its subsidiaries were acquired on 2 January 2021 by National World plc from JPIMedia Limited, a subsidiary of JPIMedia Holdings Limited. Previously the Group’s results have been reported as part of the consolidated results of the JPIMedia Holdings Limited Group. With the disposal at period end, the Directors thought it appropriate to prepare consolidated Financial Statements for the new Group, including prior year comparatives. In future periods, the Group will form part of the National World Group.