Burford Capital Ltd

Overview

The table below sets forth a summary of our consolidated statements of operations for the periods indicated.

Total revenues decreased 24% for the year ended December 31, 2025, primarily due to a decrease in capital provision income, arising mainly from lower net realized gains, and operating expenses increased, primarily due to increases in case-related expenditures ineligible for inclusion in asset cost and increases in general, administrative and other expenses. The net result was $62.6 million in net income attributable to Burford Capital Limited shareholders for the year ended December 31, 2025, as compared to net income of $146.5 million for the year ended December 31, 2024.

Revenues

The table below sets forth the components of our total revenues for the periods indicated.

Capital provision income/(loss)

The table below sets forth the components of our capital provision income for the periods indicated.

For the year ended December 31, 2025, net realized gains were $260.6 million, comprising $330.8 million of gross realized gains, offset by gross realized losses of $70.2 million. For the year ended December 31, 2024, net realized gains were $439.7 million, comprising $481.6 million of gross realized gains, offset by gross realized losses of $41.9 million. We had three large realized gains that each individually exceeded $40.0 million in 2024 and we did not have realized gains in 2025 of the same magnitude, which thus impacted our net realized gains. On the other hand, unlike 2024, we did not experience a single large realized loss in 2025, but we did have a number of smaller, immaterial losses concentrated in our higher-risk, higher-return areas. Overall, net realized gains resulted from $710.5 million in realizations for the year ended December 31, 2025, as compared to $907.0 million in realizations for the year ended December 31, 2024.

Fair value adjustments, net of previously recognized unrealized gains/(losses) transferred to realized gains, are affected by a number of factors, including changes in discount rate, duration and litigation risk premium, the reversal of previously recognized unrealized gains upon conclusion of a matter and its transfer to realized gains and actual performance of matters as they pass through milestones. All of those factors contributed to the net change in unrealized gain of $185.6 million for the year ended December 31, 2025 as compared to a net change in unrealized gain of $128.0 million for the year ended December 31, 2024, with the passage of time and the relative movement in discount rates having the largest impacts on the change year over year and the Turnover Order (as defined below) having the largest impact on an individual matter during 2025.

As part of our fair value methodology, we discount the expected future cash flows. If discount rates had remained unchanged from December 31, 2024, applying those same rates to the portfolio as of December 31, 2025, fair value would have been approximately $106.8 million lower than as reported. The weighted average discount rate across the portfolio decreased to 6.1% as of December 31, 2025, from 6.9% as of December 31, 2024, and interest sensitivities of the portfolio to assumed basis point changes in rates at each period end are disclosed in “—Critical accounting estimates—Fair value of capital provision assets”. Fair value is also impacted by changes in the adjusted risk premium, which was slightly down at 31.1% as of December 31, 2025, from 31.4% as of December 31, 2024. The impact of the addition of newly acquired or originated capital provision assets during the period (which generally have higher risk premiums at the start of the capital provision asset’s life) was offset by net favorable developments across the rest of the portfolio.

Plus/(Less): Third-party interests in capital provision assets

Third-party interests in capital provision assets reduced capital provision income by $99.1 million for the year ended December 31, 2025, due to increases in the fair value of the YPF-related assets because of the progression closer to our expected conclusion date and a decrease in discount rates. The year-over-year change was also impacted by the Turnover Order.

Marketable securities income/(loss) and interest

Marketable securities income and interest increased 15% for the year ended December 31, 2025, primarily driven by interest income earned from higher cash and cash equivalents and marketable securities balances and the impact of the appreciation of the pound sterling against the US dollar in our non-USD holdings, partially offset by lower US yields.

Operating expenses

The table below sets forth the components of our total operating expenses for the periods indicated.

Total operating expenses increased 17% for the year ended December 31, 2025, primarily due to higher case-related expenditures ineligible for inclusion in asset cost largely related to the consolidation of the EP Funds and higher general, administrative and other expenses. The increase in general, administrative and other expenses for the year ended December 31, 2025 is driven by higher professional fees incurred.

Case-related expenditures ineligible for inclusion in asset cost significantly increased for the year ended December 31, 2025, reflecting an increase in the level of expenses and the number of instances where we incur legal or other related expenses that are directly attributable to a capital provision asset but that do not form part of the deployed amount under a capital provision agreement, such as when we bear incremental legal expenses in cases. Examples of the incurrence of such expenses include situations where we are effectively the claimant in a litigation matter due to the acquisition of assets or the assignment of a claim. Such expenditures accounted for $10.4 million and $1.9 million of the total case-related expenditures ineligible for inclusion in asset cost for the years ended December 31, 2025 and 2024, respectively. Included in the $10.4 million of case-related expenditures in 2025 is $5.4 million related to contingent fee arrangements associated with the EP Funds. While we report these costs as expenses for accounting purposes, we treat them for purposes of return and performance metrics as part of the asset’s cost basis in the same way that we treat traditional legal finance arrangements.

Case-related expenditures ineligible for inclusion in asset cost also include fees paid to third parties when we have sought our own legal advice or expert opinion with respect to matters related to a capital provision asset. These expenses are expected to fluctuate period-over-period and accounted for $4.2 million and a credit of $1.1 million of total case-related expenditures ineligible for inclusion in asset cost for the years ended December 31, 2025 and 2024, respectively. A credit in case-related expenditures for 2024 was a result of cost recoveries from an insurance policy.

Other expenses

The table below sets forth the components of our total other expenses for the periods indicated.

Finance costs

Finance costs increased 11% for the year ended December 31, 2025, primarily due to higher interest expense related to the issuance of the 7.500% Senior Notes due 2033 (the"2033 Notes") during the year ended December 31, 2025.

Foreign currency transactions (gains)/losses and other expenses

Foreign currency transactions (gains)/losses and other expenses were gains of $2.9 million for the year ended December 31, 2025, as compared to losses of $1.4 million for the year ended December 31, 2024. The year-over-year change was primarily driven by the strengthening of both the pound sterling and euro against the US dollar.

Provision for/(benefit from) income taxes

The table below sets forth our provision for/(benefit from) income taxes for the periods indicated.

Provision for income taxes decreased 51% for the year ended December 31, 2025, primarily due to a reduction in overall taxable income for 2025. Cash taxes paid were $23.2 million and $19.5 million for the year ended December 31, 2025 and 2024, respectively.

The OECD has introduced Pillar Two which is a framework to implement a global minimum tax for certain multinational companies that have earned annual consolidated revenues of at least €750 million in at least two out of the prior four accounting periods. Guernsey as well as certain countries in which we operate have enacted legislation to implement Pillar Two. Pillar Two taxes are considered an alternative minimum tax accounted for as a period cost that will impact the effective tax rate in the year the Pillar Two tax obligation arises. Therefore, deferred taxes will not be recognized or adjusted for the estimated effects of future minimum taxes.

Based on our annual consolidated revenues over the past several years, we are not currently subject to the OECD Pillar Two mandate. Notwithstanding this fact, we have assessed the potential impact of Pillar Two based on laws enacted as of the date of this 2025 Form 10-K and there was no material effect on our current effective tax rate, business, financial condition, results of operations and/or liquidity for the year ended December 31, 2025. Based on this assessment and the prospective nature of the effective date of the application of the Pillar Two rules, we also do not currently anticipate any material effect on our effective tax rate, business, financial condition, results of operations and/or liquidity for the year ending December

31, 2025. See“Risk factors—Risks relating to our business and industry—Changes in tax laws and regulations or unanticipated tax liabilities could affect our effective tax rate, business, financial condition, results of operations and/or liquidity” for additional information with respect to the risks relating to Pillar Two.

Net income/(loss) attributable to non-controlling interests

The table below sets forth our net income/(loss) attributable to non-controlling interests for the periods indicated.

We consolidate certain entities that have other shareholders and/or investors, including the Advantage Fund and BOF-C. The Advantage Fund does not have a traditional management and performance fee structure, but instead we retain any excess returns after the first 10% of annual simple returns are remitted to the Advantage Fund’s investors. With respect to BOF-C, under the co-investing arrangement with the sovereign wealth fund, we (in our capacity as the appointed investment adviser) receive reimbursement of expenses from BOF-C up to a certain level before we or the sovereign wealth fund, as applicable, receive a return of capital. After the repayment of capital, we then receive a portion of the return generated from the assets held by BOF-C. We include 100% of the Advantage Fund’s and BOF-C’s income and expenses in the applicable line items in our consolidated statements of operations (for example, 100% of the income on the Advantage Fund’s and BOF-C’s capital provision assets is included in capital provision income in our consolidated statements of operations), and the net amount of those income and expense line items that relate to third-party interests is included in net income attributable to non-controlling interests. In turn, this net amount is deducted from net income to arrive at net income attributable to Burford Capital Limited shareholders in our consolidated statements of operations. Net income attributable to non-controlling interests does not include Colorado and the EP Funds. See note 2 (Summary of significant accounting policies—Consolidation) to our consolidated financial statements contained in this 2025 Form 10-K for additional information with respect to our consolidation policies.

Net income attributable to non-controlling interests decreased 88% for the year ended December 31, 2025, reflecting non-controlling interests’ share of the decrease in capital provision income year-over-over. See "Capital provision income/(loss)" above for additional information with respect to the year-over-year change in the different components of capital provision income.

The table below sets forth specified line items from our consolidated statements of financial condition as of the dates indicated.

Cash and cash equivalents and marketable securities

Cash and cash equivalents increased 21% and marketable securities increased 13% both as of December 31, 2025. The net increase in cash and cash equivalents and marketable securities primarily reflects the issuance of the 2033 Notes, partially offset by the redemption of the aggregate principal amount of the 6.125% Bonds which matured on August 12, 2025 (the“2025 Bonds”) and the impact from third-party net distributions.

Other assets

Other assets increased 21% as of December 31, 2025, primarily due to the acquisition of an equity method investment and from higher receivables.

Due from settlement of capital provision assets

Due from settlement of capital provision assets decreased 10% as of December 31, 2025, primarily due to cash received from realizations during 2025 and collections on the due from settlement of capital provision assets receivable that was outstanding as of December 31, 2024. Of the $183.9 million of due from settlement receivables as of December 31, 2024, 73% was collected in cash during 2025.

Capital provision assets

Capital provision assets increased 7% as of December 31, 2025, primarily reflecting capital provision income earned during the year and continued deployments into capital provision assets, partially offset by the impact of realizations.