Annual Report and Accounts 2024

Revenue from continuing

operations

£43.0m

(2023: £42.6m) +1%

Underlying* profit before

tax from continuing

operations

£1.2m

(2023: £1.0m) +20%

Basic earnings per

share from continuing

operations*

0.8p

(2023: 0.2p)

*before share based payments non-recurring operational costs and loss from discontinued operations

Gross profit from

continuing operations

£11.0m

(2023: £10.8m) +2%

Profit for the year from continuing operations

£0.4m

(2023: 0.1m) +300%

Cash per share

8.1p

(2023: 11.1p)

Basic Loss per share

(1.2p)

(2023: 0.6p)

Utilisation***

72.5% 72.6%

• 2023 n 2024

Net Cash**

£5.8m

£4.3m

n 2023 n 2024

SHAUN SMITH

Non-Executive

Chairman

2 December 2024

OVERVIEW

Looking back on my first full year as your Chairman, I am pleased to report that Diales Plc has enjoyed a year of consolidation, improved underlying profitability and efficiency gains, building on a well-executed turnaround in FY23. In FY24, we have laid strong and dependable foundations for future growth and taken important steps to place our business on a sustainable footing to deliver growth over coming years. FY24 has seen an improvement in underlying profit and the achievement of the targets we set ourselves in the first year of the four-year integrated transformation strategy which the Company unveiled a year ago. I believe that our shareholders can derive reassurance from Diales' strengthened financial and operational performance over the period.

Headwinds in the global economy and continuing inflationary pressures have been among the more systemic issues facing our management teams around the world which, by their very nature can in part be mitigated by careful planning and active management, but not altogether eliminated. The commercial uncertainties resulting from elections in multiple jurisdictions, including those in the UK and the US, have been pragmatically managed. The ambitions of the new governments in the UK and US to invest significantly in infrastructure may represent opportunities for the Group in future years. Similarly, if there is to be a resolution to the conflict in Ukraine, I am confident that Diales will be well positioned to capitalise on the opportunities that extensive reconstruction of that country's infrastructure would undoubtedly bring.

After a year of successful consolidation and commercial achievement, the Company is able once more to look forwards and to consider the acquisition of relevant in-fill skills and expertise to deliver future growth, in a systematic and disciplined way. We will only progress opportunities where we are content that these meet all the criteria we have set. Most of all, we will aim in everything we do to build on the improved profitability of this year, in order to ensure successful and sustainable trading in FY25 and beyond, in the best interests of our shareholders.

TRADING PERFORMANCE

In its FY23 results, the Board reported a return to profitable trading, and I am pleased to report that the Company's underlying performance has improved further in FY24. The Company's underlying operating profit improved significantly, increasing from £1.0m in FY23 to £1.2m in FY24.

These results reflect the delivery of the promised benefits arising from the cost reduction programme which completed at the end of Q1 FY24, and the progress made during the first year of the four-year integrated transformation strategy announced in December 2023.

These are respectable results and reflect continuous improvements in the Company's performance based on its bigger pipeline, stable utilisation across most regions and the priority we attach to extracting efficiency gains from the global business. Accordingly, I am pleased to propose a final dividend for the year of 0.75 pence per ordinary share which, if approved at the next Annual General Meeting, will equate to 1.5 pence per share paid as dividends for the full year.

The Company is well positioned for the year ahead. Our cash position at the end of FY24 remains strong at £4.3m, after dividends and returning cash to shareholders via a buyback, while our strategy of planned cost and risk reductions has enabled us to deliver an improved underlying profit in FY24, compared to the previous year. As I said last year, a key metric for the business is cash generation and while our business is now trading profitably on a continuous basis, we remain focused on achieving optimal operational performance, which I am confident the next three years of fulfilment of our integrated transformation strategy will deliver.

We said last year that we considered an efficient way of returning value to shareholders could be through a share buy-back initiative. In June 2024, we announced a £0.25 million share buy-back programme which has already enjoyed considerable support and, at the time of writing, the business has acquired 810,000 shares. This programme remains ongoing. The Board will keep its capital allocation under review and remains focused on organic growth and strategic acquisitions along with the return of surplus cash to our shareholders.

STRATEGY

Explained in more detail in the CEO's statement, FY24 has seen us commence the execution of our integrated transformation strategy for the benefit of our clients and shareholders. With our principal focus of organic growth and acquisitions, we remain committed to returning surplus cash to our shareholders wherever possible and the generation of long-term accretive value. FY24 began with our objective of simplifying the businesses' branded offering beneath the Diales name to help clients and prospects better understand and engage with our business worldwide; implementing a hub and spoke model for the efficient delivery of outstanding service to our clients

worldwide; resetting our relationships with and between global offices and management teams; and, by no means least, expanding the breadth, depth and quality of the Company's service offerings. I am pleased to be able to report that the business has received very positive feedback on our re-branding to our premium Diales brand from clients and staff around the world.

We continue with our mission of strengthening our global operating platform to improve client servicing in order to fulfil our mission of maximising shareholder value. This year's results provide the clearest possible testimony that our strategy is working, laying strong and sustainable foundations for further growth in FY25 and future years.

GOVERNANCE

Diales follow the Quoted Companies Alliance "Corporate Governance Guidelines for Smaller Quoted Companies" (the QCA Code) and its ten principles. We have reported against the 2018 version of the QCA Code and have undertaken a 2023 Code gap analysis with One Advisory (our Corporate Governance Advisers) that identified several areas where we have either started to work on or intend to during FY25 including - corporate culture, ESG KPIs, Audit Committee reporting and Board succession planning. We intend to report against the 2023 version of the QCA Code in our next annual report.

PEOPLE

During the last 12 months, I have had the privilege to meet many of the brilliant and committed people across our global network who make Diales such a richly rewarding place in which to work and to build careers, and who exemplify the values of integrity, professionalism, and pursuit of excellence. We are proud that people around the world see these values as being synonymous with our business. I would like to take this opportunity to thank all our staff around the world for the tremendous contribution that they have made during the period which has, in turn, delivered such positive results at the end of FY24.

I should like to thank the Board for their continued support. Our CEO, Mark Wheeler, leads our business with exceptional insight and professional understanding and our CFO, Charlotte Parsons, who plays a central role in improving our financial monitoring and forecasting, and I am grateful to each of them for their leadership.

After 2 years of consolidation and change, the business is now well positioned to make the most of the opportunities that lie ahead in FY25. Our integrated transformation strategy promises to unlock significant future efficiency gains and I am confident that these will lead to further enhancements in our return of value to our shareholders. I am pleased to report the board has agreed to return to market guidance signalling our confidence in the future prospects of the Group.

As a global expert witness and consultancy business, Diales has been providing specialist support and expertise to clients in the construction and engineering industries across the world for over thirty years.

At the heart of our operations lies our established network of offices around the world, with a knowledgeable and dedicated team experienced in providing support on the most challenging of projects, whether in an expert or advisory capacity. We speak over 25 languages collectively, including Spanish, Arabic and French, and work across the globe - a truly international presence, with local expertise.

This extended presence ensures that we are able to respond quickly to a local point of need, providing cost- effective and flexible solutions to our clients' requirements. Each of our offices offers a unique blend of skills and expertise, and our offices work together to provide the most suitable team to support our clients' needs, with open lines of communication across our entire network.

Our skills and knowledge span matters relating to project costs, delays and disruption, project management, construction management, PFI, architecture, civil engineering, structural engineering,

OUR COMPANY VALUES

mechanical and electrical services, and power and environmental engineering.

The quality and experience of our people is fundamental to our success. Whether the requirement is for initial commercial and programming support, technical advice or dedicated training at the outset of a project, or dispute management and testifying expert witness services during or at the end of a project, our team can assist.

We have experience in projects across the industry, including building, transportation and infrastructure, energy, process and industrial, oil and gas, shipbuilding and marine, and mining.

Combined with our in-house IT expertise that allows us to work remotely and handle large volumes of data, our highly qualified team is dedicated to delivering exceptional services on time and within budget.

We create innovative and flexible solutions for our clients at every opportunity, with our company values of innovation, integrity and transparency at the core of what we do.

Global expertise, delivered locally.

USA

New York

OUR SERVICES INCLUDE:

• Pre-contractreviews to identify and manage risk allocation, and contract review and team workshop sessions.
• Ongoing contract/commercial 'health-checks'.
• Assistance in the production and management of contractually compliant notices and other records, and drafting commercial and contractual correspondence.
• Preparation of commercial position papers, identifying the strengths and weaknesses of each party's position.
• Preparation, defence and negotiation of claims, including variations and compensation events, prolongation, disruption and damages.
• Final account valuation, negotiation and settlement.

Diales makes the difference in delivering robust and dynamic commercial solutions.

OUR SERVICES INCLUDE:

• Baseline programme preparation, and baseline programme validation and stress- testing to ensure compliance with contractual requirements and completion dates, to identify and manage exposure to liquidated damages.
• Progress monitoring, including preparation of contractually compliant programme updates.
• Identification of potential programme risk areas, and advice on strategies and options for managing those risks.
• Forensic delay analysis to prepare and defend claims for extensions of time.

Diales are committed to providing a fully integrated service throughout the life of the contract