Burford Capital Ltd

Unaudited condensed consolidated statements of operations for the three and nine months ended September 30, 2025 as compared to the three and nine months ended September 30, 2024

Overview

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

Total revenues decreased 72% for the three months ended September 30, 2025, primarily due to a decrease in capital provision income, arising from lower fair value adjustments. The decrease in total revenues was partially offset by a decrease in operating expenses, primarily due to lower fair value driven compensation-related accruals, partially offset by higher share-based and deferred compensation costs and higher case-related expenditures ineligible for inclusion in asset cost. The net result was $19.2 million in net loss attributable to Burford Capital Limited shareholders for the three months ended September 30, 2025, as compared to net income of $135.6 million for the three months ended September 30, 2024.

Total revenues decreased 16% for the nine months ended September 30, 2025, primarily due to a decrease in capital provision income, arising from lower net realized gains, while operating expenses increased, primarily due to increases in share-based and deferred compensation costs and in case-related expenditures ineligible for inclusion in asset cost. The net result was $100.1 million in net income attributable to Burford Capital Limited shareholders for the nine months ended September 30, 2025, as compared to net income of $159.5 million for the nine months ended September 30, 2024.

Revenues

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

Capital provision income/(loss)

Three months ended September 30, 2025 as compared to three months ended September 30, 2024

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

For the three months ended September 30, 2025, net realized gains were $70.8 million, comprising $95.8 million of gross realized gains, offset by gross realized losses of $25.0 million. For the three months ended September 30, 2024, net realized gains were $86.9 million, comprising $92.2 million of gross realized gains, offset by gross realized losses of $5.3 million. While there was more case activity in 2025 as compared to 2024, we did not have a single large realized gain in 2025 of the size we experienced in 2024, which thus impacted our net realized gains. Overall, net realized gains resulted from $139.4 million in realizations for the three months ended September 30, 2025, as compared to $254.2 million in realizations for the three months ended September 30, 2024.

Fair value adjustments, net of previously recognized unrealized gains/(losses) transferred to realized gains/(losses), are affected by a number of factors, including changes in discount rate, duration and litigation risk premium, the reversal of previously recognized unrealized gains/(losses) upon conclusion of a matter and its transfer to realized gains/(losses), and actual performance of matters as they pass through milestones. All of those factors contributed to the unrealized gain of $2.9 million for the three months ended September 30, 2025 as compared to the unrealized gain of $179.8 million for the three months ended September 30, 2024, with the relative movement in discount rates and passage of time having the largest impacts on the change period over period. No single asset had a significant impact on the results relating to other input changes.

As part of our fair value methodology, we discount the expected future cash flows. If discount rates had remained unchanged from June 30, 2025, applying those same rates to the portfolio at September 30, 2025, fair value would have been approximately $32.6 million lower than as reported. The weighted average discount rate across the portfolio decreased to 6.4% as of September 30, 2025, from 6.5% as of June 30, 2025, and interest sensitivities of the portfolio to assumed basis point changes in rates at each period end are disclosed in note 11 (Fair value of assets and liabilities) to our unaudited condensed consolidated financial statements contained in this Form 10-Q. Fair value is also impacted by changes in the adjusted risk premium, which was slightly up at 31.3% as of September 30, 2025, from 31.0% as of June 30, 2025. 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.

Nine months ended September 30, 2025 as compared tonine months ended September 30, 2024

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

For the nine months ended September 30, 2025, net realized gains were $178.7 million, comprising $232.0 million of gross realized gains, offset by gross realized losses of $53.3 million. For the nine months ended September 30, 2024, net realized gains were $262.3 million, comprising $293.5 million of gross realized gains, offset by gross realized losses of $31.2 million. While there was more case activity in 2025 as compared to 2024, we had two large realized gains in 2024 that we did not experience in 2025, which thus impacted our net realized gains. Overall, net realized gains resulted from $518.3 million in realizations for the nine months ended September 30, 2025, as compared to $559.0 million in realizations for the nine months ended September 30, 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/(losses) upon conclusion of a matter and its transfer to realized gains/(losses), and actual performance of matters as they pass through milestones. All of those factors contributed to the unrealized gain of $231.8 million for the nine months ended September 30, 2025 as compared to the unrealized gain of $205.2 million for the nine months ended September 30, 2024, with the Turnover Order (as defined below) having the largest impact.

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 at September 30, 2025, fair value would have been approximately $99.8 million lower than as reported. The weighted average discount rate across the portfolio decreased to 6.4% as of September 30, 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 note 11 (Fair value of assets and liabilities) to our unaudited condensed consolidated financial statements contained in this Form 10-Q. Fair value is also impacted by changes in the adjusted risk premium, which was slightly down at 31.3% as of September 30, 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 $19.7 million for the three months ended September 30, 2025. The lower reduction as compared to 2024 reflected the proportionate decrease in the unrealized gain related to the YPF assets, mainly due to the impact of the relative movement in discount rates.

Third-party interests in capital provision assets reduced capital provision income by $83.8 million for the nine months ended September 30, 2025, due to increases in the fair value of the YPF-related assets which were higher in 2025 given the progression closer to our expected conclusion date and a decrease in discount rates. The period-over-period change was also impacted by the Turnover Order.

Asset management income/(loss)

Asset management income decreased 19% and 18% for the three and nine months ended September 30, 2025, respectively, as the remaining funds are in run off and are therefore earning less management fee income period over period while they continue to generate episodic performance fee income. The timing of the recognition of performance fees is variable as they are recognized when a reliable estimate of the performance fees can be made, and it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The maturity and the terms of the applicable distribution waterfall for each of our private funds impacts this timing. As BOF-C and the Advantage Fund are consolidated entities, asset management income from these private funds is eliminated on a consolidated basis and is not reflected here. See “—Asset Management and Other Services segment” for a discussion of our asset management income, reflecting the impact of the income from BOF-C and the Advantage Fund.

Marketable securities income/(loss) and interest

Marketable securities income and interest decreased 17% for the three months ended September 30, 2025, primarily driven by lower US yields and the weakening of the pound sterling against the US dollar in our non-USD holdings, partially offset by higher cash and cash equivalents and marketable securities balances.

Marketable securities income and interest increased 5% for the nine months ended September 30, 2025, primarily driven by 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.

Other income/(loss)

Other income/(loss) decreased 94% for the three months ended September 30, 2025, primarily due to lower insurance net income related to fewer new policies in 2025 as compared to 2024.

Other income/(loss) decreased 85% for the nine months ended September 30, 2025, primarily due to lower insurance net income related to policy losses.

Operating expenses

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

Total operating expenses decreased 4% for the three months ended September 30, 2025, primarily due to lower fair value driven compensation-related accruals, partially offset by higher share-based and deferred compensation costs and higher case-related expenditures ineligible for inclusion in asset cost mainly related to the consolidation of the EP Funds.

Total operating expenses increased 17% for the nine months ended September 30, 2025, driven primarily by higher share-based and deferred compensation costs and higher case-related expenditures ineligible for inclusion in asset cost related to the consolidation of the EP Funds, partially offset by lower fair value driven compensation-related accruals.

The increase in share-based and deferred compensation costs for the three and nine months ended September 30, 2025, is primarily attributable to an increase in deferred compensation expense due to the expense acceleration of awards to staff who have met the service conditions of the awards, partially offset by the decrease in the price of Burford shares.

The decrease in long-term incentive compensation including accruals for the three and nine months ended September 30, 2025 is correlated to the fair value of the capital provision asset portfolio, which primarily related to lower capital provision income in 2025 as compared to 2024.

Case-related expenditures ineligible for inclusion in asset cost significantly increased for the three and nine months ended September 30, 2025, reflecting an increase in the level of expenses and 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 $2.2 million and $0.7 million of the total case-related expenditures ineligible for inclusion in asset cost for the three months ended September 30, 2025 and 2024, respectively, and $9.5 million and $1.6 million for the nine months ended September 30, 2025 and 2024, respectively. 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 $1.6 million and $0.2 million of total case-related expenditures ineligible for inclusion in asset cost for the three months ended September 30, 2025 and 2024, respectively, and $3.2 million and $1.4 million for the nine months ended September 30, 2025 and 2024, respectively.

Other expenses

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

Finance costs

Finance costs increased 21% and 8% for the three and nine months ended September 30, 2025, respectively, primarily due to higher interest expense related to the issuance of the 2033 Notes during the three months ended September 30, 2025.

Foreign currency transactions (gains)/losses and other expenses

Foreign currency transactions (gains)/losses and other expenses decreased 82% for the three months ended September 30, 2025, primarily driven by the weakening of the pound sterling against the US dollar.

Foreign currency transactions (gains)/losses and other expenses increased 149% for the nine months ended September 30, 2025, 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 67% for the three months ended September 30, 2025, primarily reflecting the impact of losses incurred during the three months ended September 30, 2025 and a reduction in overall taxable income for 2025. Cash taxes paid were $0.02 million and $12.3 million for the three months ended September 30, 2025 and 2024, respectively.

Provision for income taxes decreased 27% for the nine months ended September 30, 2025, primarily due to a reduction in overall taxable income for 2025. Cash taxes paid were $21.2 million and $12.3 million for the nine months ended September 30, 2025 and 2024, respectively.

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 unaudited condensed 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 unaudited condensed 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/(loss) attributable to non-controlling interests. In turn, this net amount is deducted from net income/(loss) to arrive at net income/(loss) attributable to Burford Capital Limited shareholders in our unaudited condensed consolidated statements of operations. Net income/(loss) attributable to non-controlling interests does not include Colorado and the EP Funds. See note 2 (Summary of significant accounting policies—Consolidation) to our unaudited condensed consolidated financial statements contained in this Form 10-Q for additional information with respect to our consolidation policies.

Net income/(loss) attributable to non-controlling interests decreased for the three months ended September 30, 2025, reflecting non-controlling interests’ share of income on capital provision assets, primarily due to the decrease in the capital provision income from BOF-C and due to the decrease in the revenue from the Advantage Fund, mainly as a result of less revenue generated from the outstanding assets in the fund.

Net income/(loss) attributable to non-controlling interests decreased 61% for the nine months ended September 30, 2025, reflecting non-controlling interests’ share of income on capital provision assets, primarily due to the decrease in the revenue from the Advantage Fund, mainly as a result of less revenue generated from the outstanding assets in the fund, and due to the decrease in the capital provision income from BOF-C.

Unaudited condensed consolidated statements of financial condition as of September 30, 2025 as compared to December 31, 2024

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

Cash and cash equivalents and marketable securities

Cash and cash equivalents increased 44% and marketable securities increased 0.1% both as of September 30, 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 2025 Bonds and the impact from third-party net distributions.

Other assets

Other assets increased 29% as of September 30, 2025, primarily due to higher receivables and from the acquisition of an equity method investment.

Due from settlement of capital provision assets

Due from settlement of capital provision assets decreased 47% as of September 30, 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, 68% was collected in cash during 2025.

Capital provision assets

Capital provision assets increased 7% as of September 30, 2025, primarily reflecting fair value gains earned in 2025 and continued deployments into capital provision assets, partially offset by the impact of realizations.