Final Results, Notice of AGM & Investor Pres

About this update from Sigmaroc Plc

[{"type":"text","content":"\n \n (EPIC: SRC / Market: AIM / Sector: Construction Materials) \n 18 March 2024 \n   \n SigmaRoc plc \n ('SigmaRoc', the 'Company' or the 'Group') \n   \n Audited full year results for year ended 31 December 2023 \n Notice of AGM \n   \n SigmaRoc (AIM: SRC), the AIM quoted lime and limestone group , is pleased to announce its audited results for the year ended 31 December 2023. \n   \n \n \n \n \n   \n \n \n Statutory results \n \n \n   \n \n \n Underlying [1] results \n \n \n \n \n   \n \n \n 31 December 2023 \n \n \n 31 December 2022 \n \n \n YoY \n change \n \n \n   \n \n \n 31 December 2023 \n \n \n 31 December 2022 \n \n \n YoY \n change \n \n \n \n \n Revenue \n \n \n £580.3m \n \n \n £538.0m \n \n \n +8% \n \n \n \n \n \n £580.3m \n \n \n £538.0m \n \n \n +8% \n \n \n \n \n EBITDA \n \n \n £87.3m \n \n \n £95.0m \n \n \n -8% \n \n \n \n \n \n £116.7m \n \n \n £101.7m \n \n \n +15% \n \n \n \n \n EBITDA margin \n \n \n 15.0% \n \n \n 17.7% \n \n \n -270bps \n \n \n \n \n \n 20.1% \n \n \n 18.9% \n \n \n +120bps \n \n \n \n \n Profit before tax \n \n \n £28.3m \n \n \n £42.7m \n \n \n -42% \n \n \n \n \n \n £71.2m \n \n \n £62.7m \n \n \n +14% \n \n \n \n \n EPS \n \n \n 1.95p \n \n \n 4.89p \n \n \n -60% \n \n \n \n \n \n 8.12p \n \n \n 8.0p \n \n \n +1% \n \n \n \n \n Net debt 2 \n \n \n \n \n \n   \n \n \n   \n \n \n \n \n \n £182.4m \n \n \n £193.8m \n \n \n -6% \n \n \n \n \n Covenant Leverage \n \n \n \n \n \n   \n \n \n   \n \n \n \n \n \n 1.57x \n \n \n 1.93x \n \n \n -19% \n \n \n \n \n ROIC \n \n \n \n \n \n   \n \n \n   \n \n \n \n \n \n 10.8% \n \n \n 10.3% \n \n \n +50bps \n \n \n \n \n FCF 3 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n £47.0m \n \n \n £54.3m \n \n \n -12.7% \n \n \n \n \n FCF Conversion 4 \n \n \n \n \n \n   \n \n \n   \n \n \n \n \n \n 40.3% \n \n \n 53.4% \n \n \n -12.7ppt \n \n \n \n \n   \n [1] Underlying results are stated before acquisition related expenses, certain finance costs, redundancy and reorganisation costs, impairments, amortisation of acquisition intangibles and share option expense. References to an Underlying profit measure throughout this Annual Report are defined on this basis. Non-underlying items are described further in the Chief Financial Officer's report. These measures are not defined by UK IAS and therefore may not be directly comparable to similar measures adopted by other companies. \n 2 Net debt including IFRS 16 lease liabilities. \n 3 Free Cash Flow takes net cash flows from operating activities and adjusts for CapEx, net interest paid, and for the underlying result further adjusts for net non-underlying expenses paid and working capital payments relating to pre-acquisition accruals or purchase price adjustments. \n 4 Free Cash Flow Conversion is FCF relative to underlying EBITDA. \n 5 Company compiled analyst consensus estimates as of 18 December 2023: revenue of £596.9m, underlying EBITDA of £110.2m and underlying EPS of 7.5p. \n 6 ROIC calculation revised to include total equity in invested capital rather than just share capital. \n   \n Financial highlights: \n   \n Strategic execution driving strong performance, against a challenging market backdrop \n -     Trading resilience, efficiency gains and value-accretive acquisitions combined to deliver record earnings performance, ahead of original expectations 5 \n -     LFL revenue grew by 2% and underlying EBITDA by 10%, despite a 4% volume decline, reflecting the Group's strong market position, pricing power and differentiated operational model with diversified end markets \n -     Continued emphasis on operational efficiency, with £4m of annualised profitability gains delivered across the Group, enabled further underlying EBITDA margins improvement to over 20%, demonstrating the Group's pricing power \n -     Underlying EPS increased by 1% despite significant increase in finance costs and impact of  dilution from the £30m equity fundraise in February 2023 with the proceeds fully invested in the months following the fundraise \n   \n Strong financial position and improved returns \n -     Covenant Leverage reduced to 1.57x further demonstrates ability of Group to de-gear while continuing to invest in growth \n -     ROIC increased by 50bps to 10.8% 6 , with clear path to medium term target of 15% \n -     Underlying EBIT ROI of 14% for acquired businesses (including FY23 acquisitions) \n -     Solid FCF at £47m reduced 13% YoY due to higher net interest payments and working capital absorption to support growth \n   \n Operational and Strategic highlights: \n   \n Growth \n -     Benefited from broad diversification across end markets and regions \n -     Subdued demand in residential construction markets was partially offset by a stronger backdrop for infrastructure projects and industrial markets \n -     Leadership in local markets and continued focus on service excellence supported a dynamic pricing approach, which largely offset the impact of inflation through the year \n   \n Investment \n -     Entered into agreements, in November 2023, to acquire CRH's European lime and industrial limestone assets, transforming the Group into a leading European producer \n -     Deployed £32m to acquire six businesses generating £8m EBITDA across the UK, Belgium, France and the Nordics, which have all been successfully integrated and generating proforma 2023 EBITDA of £10m \n -     CapEx of £33m includes £5m of quarry development contributing toward c.175 years of mine life at CDH and Ronez \n -     Successfully developed new asphalt plant in Llandarcy with first commercial sales commencing in March 2024 \n -     Successful commissioning of Aqualung carbon capture technology in Sweden, ongoing deployment of biofuels across network, and partnership formed with Materials Evolution to further decarbonise concrete product offerings in line with the Group's ESG strategy \n   \n Execution \n -     Continued safety improvement across the Group, with Total Incident Frequency Rate (TIFR) and Serious Harm Injury Frequency Rate (SHIFR) improved by 6% and 31% respectively including both employees and contractors. \n -     Successful launch of Aqualung carbon capture facility in Sweden with development now focused on purification, compression and liquefaction for utilisation \n -     Launch of Puccini Blue, a revolutionary, highly sustainable re-interpretation of Belgium Blue Stone, revealing unique features not seen in other natural stone \n -     Progress on Materials Evolution partnership to produce low-carbon concrete products with the first plant on CCP's site near Wrexham expected to be operational mid-2024 \n -     Delivering continued YoY sustainability improvements: \n o  29% reduction in CO 2 e intensity since 2021 baseline \n o  12% YoY reduction in electrical energy intensity \n o  71% fossil free electricity across the Group supported by 100% fossil free electricity in Nordics and Belgium. \n o  POC to show kilns can run on between 50%-100% biofuel depending on kiln type \n o  35% of total energy consumption from alternative and renewable means \n   \n Outlook \n -     Trends from 2023 expected to persist into 2024, with strong infrastructure and industrial markets and subdued residential construction \n -     Trading for the first two months of the year in-line with expectations, hence the Board's outlook for FY24 remains unchanged \n -     Integration of CRH European lime and industrial limestone assets is progressing well and the Board is confident that once integrated, the Group will begin delivering previously outlined synergies, enhancing cash flows, and reducing leverage \n   \n   \n Notice of Annual General Meeting \n   \n SigmaRoc is also pleased to provide notice that its Annual General Meeting ('AGM') will be held at 12:30pm on Friday 12th April 2024 at The Washington Mayfair Hotel, 5 Curzon St, London, W1J 5HE. \n   \n Copies of the Notice of AGM, together with the Form of Proxy and Annual Report will be posted to shareholders and be available to view on the Company's website shortly.  \n   \n Max Vermorken, CEO, commented: \n   \n \"2023 is another year where SigmaRoc delivered performance ahead of expectations in challenging market conditions. We have demonstrated resilient trading, growing revenue, EBITDA and EPS whilst managing the balance sheet to deliver reduced year end gearing, despite the growth and continuing investment into the business. \n   \n The strategic initiatives we launched in the year are all now contributing, with the transformational acquisition of European lime assets that creates Europe's leading lime business completed immediately post year end with the integration of these assets progressing in line with our expectations. \n   \n We continue to innovate in our business and are well set up with our enlarged footprint and focus on lime to benefit from long term drivers across the industrial, construction and environmental markets. The transition to a green economy will drive investment in critical infrastructure, with lime an essential component of every aspect of this investment. \n   \n 2024 has started well and I look forward to updating the market on what I expect to be another year of progress as Northern Europe's leading lime operator.\" \n   \n END \n \nThe full text of the statement is set out below, together with detailed financial results, and will be available on the Company's website at www.sigmaroc.com. \n \n Analyst Briefing    \n SigmaRoc will host a hybrid briefing for invited analysts at 8:30am today. For more details and to register to attend please email [email protected].   \n \n Private Investor Presentation    \n SigmaRoc is pleased to announce that its Chairman, David Barrett, its Chief Executive Officer, Max Vermorken, and its Chief Financial Officer, Garth Palmer, will provide a live presentation to private investors reviewing the 2023 results and prospects via Investor Meet Company today at 2.00pm GMT.    \n The presentation is open to all existing and potential shareholders. Questions can be submitted at any time during the live presentation. Investors can sign up to Investor Meet Company for free and add to meet SigmaRoc via:    \n https://www.investormeetcompany.com/sigmaroc-plc/register-investor    \n Investors who already follow SigmaRoc on the Investor Meet Company platform have automatically been invited. \n   \n --------------------------------------------------------------------------------------------------------------------------- \n For further information, please contact: \n   \n \n \n \n \n SigmaRoc plc \n Max Vermorken (Chief Executive Officer) \n Garth Palmer (Chief Financial Officer) \n Tom Jenkins (Head of Investor Relations) \n   \n \n \n Tel: +44 (0) 207 002 1080 \n \n   \n [email protected] \n   \n \n \n \n \n Liberum Capital (Nomad and Co-Broker) \n Dru Danford / Ben Cryer / John More \n   \n \n \n Tel: +44 (0) 203 100 2000 \n   \n   \n \n \n \n \n Deutsche Numis (Co-Broker) \n Richard Thomas / Hannah Boros \n   \n Peel Hunt (Co-Broker) \n Mike Bell / Ed Allsopp \n   \n Walbrook PR Ltd (Public Relations) \n Tom Cooper / Nick Rome \n   \n   \n \n \n Tel: +44 (0) 207 260 1000 \n   \n   \n Tel: +44 (0) 20 7418 8900 \n   \n   \n Tel: +44 20 7933 8780  [email protected] \n Mob: +44 7971 221972 \n   \n \n \n \n \n   \n   \n   \n \n CHAIRMAN'S STATEMENT \n   \n At the end of 2023, we achieved a key milestone in the development of our Group, with the proposed acquisition of CRH's European lime assets. The first and largest of three phases of this transaction completed post period end, in January 2024, and we are now positioned to become a leading operator in these markets across Europe. This strategic move, a long-held ambition cultivated through careful assembly of the right assets in Northern Europe, brings transformational scale, market position and product offering as we evolve into a leading lime entity. \n   \n This strategic advancement was realised amidst challenging market conditions both in equity markets and across various sectors and regions, yet we maintained our core business's record of continuous improvement, with another year of strong performance. This report offers deeper insights and context as we gear up for yet another year of substantial progress. \n   \n Overview \n   \n I am very pleased to report another solid financial performance for the year. Despite a challenging market, we achieved a 2% LFL increase in revenues to £580m, while managing a 4% LFL decrease in volumes. This performance underscores the robust and diverse nature of our Group, adept at sustaining earnings growth even in subdued markets. \n   \n We also enhanced our underlying profitability, with a 10% LFL increase in underlying EBITDA, and a modest yet positive improvement in underlying EPS to 8.12p. This was achieved amidst a significant YoY increase in financing costs and the effective absorption of the dilutive impact from the February 2023 fundraising. \n   \n Our teams have demonstrated exceptional focus and efficiency, leading to operational improvements across the board and a return to historical margin trends. These efficiency improvements have been primarily operational and have led to significant net cost reductions across the Group. Commercial initiatives, selling product in new markets, or new products in old markets have also helped deliver these results. \n   \n Our year was not just about financial gains. We made significant strides in our environmental, social, and governance (ESG) initiatives. Our safety standards have improved further due to a new group-wide safety management approach. Environmentally, we have made a significant leap by operating one of Europe's largest carbon capture systems in Sweden. In respect of Governance, we are actively pursuing the addition of two independent board members and the refinement of our policies and procedures strengthens our corporate structure. \n   \n Lime and limestone \n   \n The CRH Lime Acquisitions, announced in November 2023, stand as a transformative milestone for the Group. These acquisitions not only elevate our operations in the sector, but also align with our ambition for compounding growth and market leadership. Lime and limestone, being essential to modern life and industry, place us at the forefront of a market critical to the ongoing economic transition towards sustainability. \n   \n Lime and limestone are less well understood as critical minerals for modern life. They are however, both key, and will continue to be. Lime is sometimes described as by far the cheapest alkali available, and alkali are a group of chemical compounds without which a whole host of industrial processes simply cannot run. This is what makes these minerals so exciting to us as a Group. \n   \n Outlook \n   \n As we enter FY24, we have several important areas of focus including the completion of the remaining transactions from CRH and seamlessly integrating these assets. Once integrated we will turn our attention to delivering the previously outlined synergies, enhancing cash flows, and reducing leverage, thereby setting a strong foundation for further growth, with a strategic focus on lime and limestone. \n   \n The trading backdrop in the early months of 2024 remains similar to 2023, characterised by variability and challenges, conditions which our diversified market exposure is well set up to effectively address. The European construction sector continues to face challenges, in the residential segments, whilst ongoing infrastructure investment is expected to support ongoing project activity. Industrial demand will vary by sector, influenced by both local and global trends. In particular paper and pulp is having a better year, while steel production benefits from disruptions in other regions. \n   \n Overall, however, we remain optimistic on the outlook for the year with respect to potentially improving demand for newbuild housing as expected interest rate cuts improve the wider construction climate.  The likely reversal should have further spill-over effects in other areas of the economy benefitting our end markets in general.  \n   \n In closing, the past year has been a testament to our resilience and strategic foresight. As we move forward, we remain committed to facing challenges head-on and capitalising on opportunities for growth and development. \n   \n Thank you for your continued trust and support . \n   \n David Barrett \n Executive Chairman \n 17 March 2024 \n   \n   \n \n \n CEO's STRATEGIC REPORT \n   \n In 2016, we launched SigmaRoc with the ambition to operate a portfolio of high-quality assets across Northern Europe which would give us an advantageous competitive position thanks to their market position, barriers to entry, margin and improvement potential and potential links to larger economic players. All of these features are clearly evident in what we now very simply describe as a leading European lime and limestone business. \n   \n Lime and limestone are a unique group of products, critical to modern life and essential to a more sustainable world. Building a leading position in this sector is not easy and has been the long-term ambition of our group, initially through our acquisitions of CDH in 2019 and Nordkalk in 2021. Whilst market and operating conditions in both 2022 and 2023 became increasingly challenging, leading many competitors to pause their strategic growth ambition, we continued to integrate, grow and optimise our businesses with the same agility and focus that has been the hallmark of the Group. By retaining focus on our goals, we were able to execute the transformational strategic step in our evolution this year, through the acquisition of CRH's asset base and successfully position ourselves as a leader in limestone and lime across Northern Europe. This pivotal evolution has not only brought strategic alignment across our operations but also paved the way for sustainable growth and enhanced shareholder value. \n   \n The journey to this point has been intricate and required a series of calculated assumptions and strategic steps, executed with precision and timeliness. The support from our shareholders and the relentless commitment of our team were instrumental in this journey. Their contributions have been the cornerstone in establishing SigmaRoc as a key player in the European lime industry, a sector vital to both construction and industrial applications. \n   \n This statement aims to provide additional context on the year that just closed, the steps taken, and how these steps now set the Group up for chapter two of its journey. We are now poised to focus on integrating our diverse operations into a synergistic whole, a compounding value creator, a driver of innovation, a leader in the sector, and hopefully the envy of the industrial minerals space. \n   \n Financial performance   \n   \n The Group again delivered a strong performance against very challenging market conditions in 2023, a testament to the diversification and quality of the business, as well as the skill in execution of our team. Group revenue increased to £580m, a 2% LFL increase. Underlying EBITDA increased to £117m, an increase of 10% LFL. \n   \n Underlying profit after tax increased to £58.8m, translating into underlying EPS of 8.12p, representing a 1% increase YoY. This evolution is very pleasing as the senior debt finance costs more than doubled between 2022 and 2023, reflecting rising interest rates. Tax expense increased also, from 15% to 17% of profit before tax, as some carry forward losses were used up in prior periods. The ability of the Group to deliver another year of underlying EPS growth is an enormous testament to the hard work of so many, in particular those seldomly mentioned in our annual report, our machine and plant operators, quarry staff and sales representatives who all look for ideas to improve the performance of the Group. \n   \n Considering this performance on a more granular level, the Group performed particularly well given some of the local trading conditions. Overall volumes were down, as was to be expected, but by only 4% LFL, a modest drop when considering an average European construction output slowdown of 1.7% with 1.6% in the UK. The largest impact on volumes was therefore within the construction segment, particularly newbuild housing, where much action was taken early in the year. \n   \n Industrial performance was overall in line with our expectations, for a year without volume growth on the back of overstocking in the paper segment, and a reduction in demand for some chemical applications. These lower volumes were compensated for by robust continued demand in steel, environmental and infrastructure projects. \n   \n Considering these trends on a regional basis, our North West region, comprising mostly construction materials businesses including more commodity-like products, had several challenging months to endure as they actively shifted focus from residential to infrastructure projects. Much progress was made to upscale the precast products. The integrated businesses in Wales and the Channel Islands delivered a strong year, despite several contractor bankruptcies in Jersey created disruption in this market. As a result, the North West region recorded a LFL decrease in revenues of 1%, against a LFL decline in volumes of 8% and LFL underlying EBITDA improvement of 1%. \n   \n The West region also delivered a solid performance across its two platforms, Dimension Stone and Benelux. Initiatives taken in 2022, commercially and within production, helped Dimension Stone trade successfully through a challenging market, assisted by additional infrastructure work and overseas sales. The aggregates and concrete businesses both had good years, despite increased monthly volume volatility. West region volumes decreased by 8% LFL, delivering overall revenues of €114m, a LFL decrease of 7%. In spite of the difficult trading conditions, the West region was able effectively to manage its cost base and increase underlying EBITDA by 15% LFL, achieving a 473bps improvement in underlying EBITDA margin in the process. The new businesses in the Limburg region and on the southern border of Belgium performed well, delivering more than expected in their first partial year of ownership. \n   \n Our North East region had a great year delivering on all strategic and financial priorities. The restructure announced at the end of 2022 helped deliver a more agile organisation, able to capture more value via commercial and operational initiatives. Revenues increased to €390m, a 3% LFL increase, on volumes down 3% LFL, driven mainly by weaker residential construction demand in the Nordics which has relatively low impact on profitability. The Lime, Poland and the Baltic businesses performed strongly, translating into a 12% LFL increase in underlying EBITDA and a 179bps improvement in underlying EBITDA margin . \n   \n Strategic development \n   \n 2023 marked an exceptionally dynamic year in our Group's history. At the end of 2022 we had identified several acquisition and investment opportunities that were available at depressed valuations, due to macro-economic uncertainty. This pipeline of bolt-on acquisitions consolidated our positions in Sweden, Finland, the Baltic states, Benelux and the UK, expanding our Group in terms of geography and product range in a year where volume growth was likely to be extremely challenging. \n   \n As we embarked on integrating these bolt-on acquisitions, our focus shifted to an opportunity that has been a long-held ambition of the Group - the acquisition of CRH's lime and industrial limestone assets. These very significant assets, known for their operational efficiency and value, presented a complex acquisition proposition, especially in a transaction climate that appeared less favourable. \n   \n Notwithstanding the backdrop, our evaluation of the transaction was very clear and came from two perspectives: firstly, its financial viability, considering immediate and long-term earnings growth and our ability to achieve and maintain target ROIC levels; and secondly, the strategic value in elevating our status, not merely as a participant in the lime and limestone sector, but as a principal producer of these essential materials in Northern Europe. \n   \n What followed were months of work by a small but dedicated team to deliver a transaction which if completed in full, would see our Group double in size and establish itself as Europe's second largest producer by volume of a critical industrial and construction mineral. The project was ambitious and extremely challenging given its scale and structure. \n   \n It required a significant scale up in debt facilities which our two main banks, Santander and BNPP, fully underwrote. We further relied on equity investment from existing and new shareholders to fund the acquisitions. Despite the complexities, with the critical support from our shareholders we were able to finalise the transformative transaction by the end of November 2023. \n   \n The acquisitions do more than just amplify our size in the lime sector. First, they clarify and accelerate our strategic direction, affirming our central commitment to the lime and limestone sector. Secondly, they bring us to a scale where concurrent objectives of compounding growth, share buybacks, dividend distributions, and debt reduction become achievable. Lastly, through geographic footprint and product offering, it transforms SigmaRoc into a unique asset backed industrial minerals group with much further potential. \n   \n Safety \n   \n The Group has made significant progress in safety throughout 2023, with our drive for continuous improvement prompting a fresh perspective on safety practices. Although reporting via our HighVizz application was already commendable, the implementation of learnings across the Group needed improvement. \n   \n In response, our board safety committee introduced two fundamental changes. First, we launched a Group-wide supervisor training programme to ensure that supervisors are effectively fulfilling their roles. This training highlighted that, in many cases, individuals designated as supervisors were not fully performing their duties, leaving critical supervisory roles effectively unmanned. As a result, unsafe behaviours or key learnings at Group level were not consistently reaching operators. \n   \n The second major change was the initiation of a safety audit programme. Similar in concept to a financial audit, the safety team of the Group, with a Group-wide mandate, now conducts audits at all sites to assess both the accuracy of safety documentation and the actual safety practices on the ground. \n   \n These audits are designed to drive continuous improvement in our operations. 172 audits were conducted this year by Clint White, our HSE&P Director. An incredible feat reflecting our unwavering commitment to ensuring the highest standards of safety across all operations. A comprehensive review of the progress we have made can be found in the ESG section. \n   \n Environmental and social \n   \n Alongside safety we made good progress in a number of other facets of our ESG strategy in 2023. To document progress clearly, we have now included a dedicated ESG section in this report. Of the many initiatives detailed in the ESG report, there are four projects of which we are especially proud. \n   \n First, we believe we are the first kiln operation in Europe with a fully functioning carbon capture facility, capable of capturing CO 2 at scale. The installation has been fully commissioned and is now capturing CO 2 to calibrate the second stage of the CCUS process - either utilisation (U), or sequestration (S). Progress is being made in both areas, with the help of additional testing facilities to ensure the quality and consistency of the captured CO 2 for effective use in either U or S scenarios. \n   \n The second project is the launch of a full-scale aggregates recycling installation in North Wales, which now treats and recycles 350kt tonnes of waste aggregates per year. This initiative will eventually liberate c.5m tonnes of virgin aggregate previously trapped beneath waste piles deemed of insufficient quality for recycling. This complements our recycling activities in Finland, Sweden, Belgium and the Channel Islands, where we are processing returned concrete, demolition waste and waste aggregates. \n   \n The third project focuses on utilising 100% of the material extracted from our dimension stone quarries. Previously, stone not suitable for high-quality slabs or tiles was used for security bunds or construction aggregate - neither high in value nor value-add. Throughout the year, our teams in Belgium have explored various high-value applications for this stone, significantly enhancing its potential. \n   \n Lastly, we have continued our efforts to clean our energy sources, both in terms of combustibles and electricity. Significant progress detailed in the ESG section, includes applications for wind turbines to supplement our solar arrays and increase clean energy usage at various production sites. Additionally, we are transitioning to biofuels for running our kilns, having already achieved a full week of operation solely on biofuels - a first in the industry. \n   \n With respect to social targets we have made a leap forward as well, delivering over 22,000 hours of learning and development, as well as promoting diversity across the group with 42% of non-operational positions being held by women. At a local level our business continues to work closely with our communities, donating time and materials to community projects as well as land and water for community use. \n   \n Overall, the progress in 2023 has been significant, paralleled by our active engagement in financial and growth objectives. More developments are expected in the future . \n   \n Non-Financial and Sustainability Information Statement \n   \n The Company recognises the need to report on the on the principal risks associated with climate change and sustainability under the Companies Act. The Group has fulfilled their requirements to report under the act throughout the ESG section. \n   \n Governance \n   \n We have continued to make significant strides in governance, with the rollout of additional policies across the Group, further strengthening our commitment to robust and effective management practices, and establishing new board committees focusing on ESG and Innovation. These committees are instrumental in guiding our strategic direction in these critical areas, ensuring that we stay at the forefront of industry developments and maintain our commitment to sustainable and innovative practices. \n   \n Innovation \n   \n The fourth pillar of our 4i operational model, innovation, has seen notable advancement, extending beyond our ESG-related programmes. This year we have made significant progress in our product range and innovation investment, with three projects particularly standing out. \n   \n First, we have made considerable further progress with our Greenbloc range. This product line is now incorporated in almost all of our concrete products, available in three distinct performance levels. These levels provide a range of embodied CO 2 reductions from 50% to 90%. Looking ahead, we aim to surpass the 100% mark, positioning ourselves as pioneers in producing large-scale negative carbon concrete products. \n   \n In our quest for innovation, we have initiated a scheme to fund external technologies that can make our products more competitive, advanced and/or sustainable. Highvizz was an early success within this initiative and building on this, we have now formed a partnership with Mevo. \n   \n Mevo is a revolutionary new technology for the grinding and blending of non-cementitious minerals, imparting certain binding properties to the materials. We have supported Mevo in raising £15m in venture funding and have assisted in the construction of its first large-scale plant. Once operational, we anticipate that Mevo's technology will be at the forefront of decarbonising all our concrete products. \n   \n Post period announcements \n   \n On 4 January 2024 the Group successfully completed the first of three proposed CRH Lime acquisitions, and in conjunction with CRH Deal 1 completed admission of the Group's enlarged share capital with a £200m gross equity fundraise and new €875m senior finance facility. \n   \n On 1 March 2024 the Group issued notice of exercise of the call option to acquire CRH's UK lime operations for a total consideration of €155m, with the transaction expected to complete by the end of March 2024 . \n   \n Outlook \n   \n SigmaRoc's impressive performance in 2023, reflected in our robust financial results, underscores the inherent strength and quality of our assets and operations. Since January 2024, we have welcomed several new businesses into our Group, and this expansion is set to continue as we acquire the remainder of CRH's European lime businesses in a planned phased approach. Each of these acquisitions represents high-quality assets with strong market positions, reinforcing our confidence in the sustained performance of not only our existing operations but also those of the recently integrated businesses. \n   \n This report was approved by the Board on 17 March 2024. \n   \n Max Vermorken \n Chief Executive Officer \n   \n \n \n   \n CHIEF FINANCIAL OFFICER'S REPORT \n   \n I am pleased to report yet another strong year financially for the Group, surpassing expectations in a challenging operational and market environment. While residential construction markets showed significantly subdued volume, our profitability improved. This achievement is due to strong performance in industrial minerals and infrastructure markets, coupled with proactive management actions in the UK and Nordics to optimise operations. \n   \n For the year ending 31 December 2023, the Group generated revenue of £580.3 million (2022: £538.0 million) and underlying EBITDA of £116.7 million (2022: £101.7 million). Underlying profit before taxation for the Group was £71.2 million (2022: £62.7 million). \n   \n The statutory loss for the Company for the year ended 31 December 2023 before taxation amounts to £42.9 million (2022: loss £24.4 million), which includes £30.0 million of non-underlying expenses primarily pertaining to M&A related cash fees, non-cash share option expense and amortisation of finance costs. \n   \n The Board monitors the activities and performance of the Group on a regular basis and uses financial indicators based on budget versus actual to assess the performance of the Group. The indicators set out below will continue to be used by the Board to assess performance over the period to 31 December 2023. \n   \n \n \n \n \n   \n \n \n 2023 \n £'000 \n \n \n 2022 \n £'000 \n \n \n \n \n Cash and cash equivalents \n \n \n 55,872 \n \n \n 68,623 \n \n \n \n \n Revenue \n \n \n 580,285 \n \n \n 537,993 \n \n \n \n \n Underlying EBITDA \n \n \n 116,688 \n \n \n 101,723 \n \n \n \n \n Capital expenditure \n \n \n 43,046 \n \n \n 52,721 \n \n \n \n \n   \n Cash generated from operations was £65.4 million (2022: £87.7 million) with a net decrease in cash of £11.5 million (2022: £4.0 million) after spending £30.2 million on acquisitions net of cash acquired, £37.1 million in net capital expenditure and £20.0 million in senior loan amortisation repayments. \n   \n Underlying EBITDA exceeded expectations and management forecasts, while revenue and volumes were somewhat softer due to difficult residential construction markets and dynamic pricing effects of lower input costs. \n   \n Capital expenditure relates to purchases of land and minerals, new plant and machinery and improvements to existing infrastructure across the Group. \n   \n PPA \n   \n BDO UK LLP undertook the PPA exercise required under IFRS 3 to allocate a fair value to the acquired assets of JQG and Goijens. \n   \n The PPA process resulted in a reduction of goodwill recorded on the Statement of Financial Position of the Group for JQG from £49.8 million to £16.7 million and a reduction in Goijens from £5.1 million to £1.6 million. The reduction was to transfer the value of goodwill to tangible assets for land and buildings, land and mineral reserves, intangible assets and deferred tax assets. \n   \n Non-underlying items \n   \n The Company's loss after taxation for 2023 amounts to £42.9 million, of which £30.0 million relates to non-underlying items, while the Group's non-underlying items totalled £42.1 million for the year, of which £12.3 million, representing approximately 30%, are non-cash and non-tax deductible. These items relate to seven categories: \n   \n 1.   £25.9 million in exclusivity, introducer, advisor, consulting, legal fees, accounting fees, insurance and other direct costs relating to acquisitions. During the year the Group acquired Juuan Dolomitik, Goijens, Retaining, Björka Mineral, ST Investicija, Beton and entered into agreements for the CRH Lime Acquisitions which comprise the vast majority of the costs incurred during the year. \n   \n 2.   £6.6 million amortisation of acquired assets and adjustments to acquired assets. \n   \n 3.   £4.0 million in share-based payments relating to grants of options. \n   \n 4.   £3.7 million legal and restructuring expenses relating to the reorganisation and integration of recently acquired subsidiaries, including costs associated with discontinuing sites and operations, transitional salary costs, redundancies, severance and recruitment fees, and costs associated with financial reporting and system migrations. \n   \n 5.   £1.1 million on amortisation of finance costs arising from the syndicated 5-year debt facilities established in July 2021. \n   \n 6.   £0.4 million on unwinding of discounts on deferred consideration payments for Harries. \n   \n 7.   £0.4 million in other exceptional costs which primarily relate to non-cash balance sheet adjustments. \n   \n   \n Interest and tax \n   \n Net finance costs in the year totalled £15.9 million (2022: £10.4 million) including associated interest on bank finance facilities, as well as interest on finance leases (including IFRS 16 adjustments) and hire purchase agreements. \n   \n A tax charge of £12.4 million (2022: £9.1 million) was recognised in the year, resulting in a tax charge on profitability generated from mineral extraction in the Channel Islands and profits generated through the Group's UK, Belgium and Nordic based operations. \n \n Earnings per share \n   \n Basic EPS for the year was 1.98 pence (2022: 4.89 pence) and underlying basic EPS (adjusted for the non-underlying items mentioned above) for the year totaled 8.12 pence (2022: 8.03 pence). \n   \n Statement of financial position \n   \n Net assets at 31 December 2023 were £514.9 million (2022: £469.9 million). Net assets are underpinned by mineral resources, land and buildings and plant and machinery assets of the Group. \n   \n Cash flow \n   \n Cash generated by operations was £65.4 million (2022: £87.7 million). The Group spent £30.2 million on acquisitions net of cash acquired, £37.1 million on capital projects including acquisition of intangibles, raised £29.2 million net of fees from the issue of equity, generated £5.2 million through the disposal of non-core property, plant & equipment, and repaid net borrowings of £27.0 million. The net result was a cash outflow for the year of £11.5 million. \n   \n Net debt \n   \n Net debt at 31 December 2023 was £182.4 million (2022: £193.8 million). \n   \n Bank facilities \n   \n On 22 November 2023 the Company entered a new syndicated senior credit facility of up to €750 million (the 'New Debt Facilities') led by Santander UK and BNPP, with the syndicate including several major UK and European banks and a further €125 million bridge loan ('Bridge Loan'). The New Debt Facilities were partially drawn on 4 January 2024 in connection with the CRH Lime Acquisitions, specifically CRH Deal 1, and the legacy debt facility was repaid as part of this process. \n   \n The New Debt Facilities comprise a €600 million committed term facility, €150 million revolving credit facility and a further €100 million uncommitted accordion. \n   \n The Group's  New Debt Facilities have a maturity date of 21 November 2028 and are subject to a variable interest rate based on EURIBOR plus a margin depending on underlying EBITDA. \n   \n The Group's  New Debt Facilities are subject to covenants which are tested monthly and certified quarterly. These covenants are: \n ·      Group interest cover ratio set at a minimum of 3.5 times EBITDA while the Bridge Loan remains outstanding and then 4.0 times thereafter; and \n ·      A maximum adjusted leverage ratio, which is the ratio of total net debt, including further borrowings such as deferred consideration, to adjusted EBITDA, of 3.95x in 2024. \n   \n The Bridge Loan has a maturity date of 21 November 2024, with options for two 6-month extensions which if exercised would push maturity to 21 November 2025. The Bridge Loan is subject to a variable interest rate based on EURIBOR plus a margin as follows: \n -       2% for months 0 - 6 \n -       3% for months 7 - 12 \n -       4% for months 13 - 18 (assuming exercise of the first extension option) \n -       5% for months 19 - 24 (assuming exercise of the second extension option) \n   \n As at 31 December 2023, the Group comfortably complied with its bank facility covenants under the terms of the legacy debt facility and total undrawn facilities available to the Group under the legacy debt facility amounted to approximately £ 173 million. \n   \n Capital allocation \n   \n We prioritise the maintenance of a strong balance   sheet and deploy our capital responsibly, allowing us   to commit significant organic investment to our   business whilst continuing to pursue acquisitions to   accelerate our strategic development.   This conservative approach to financial management   will enable us to continue pursuing capital growth for   our shareholders.   \n   \n Dividends \n   \n Subject to availability of distributable reserves, dividends will be paid to shareholders when the Directors believe it is appropriate and prudent to do so. The Group has achieved significant capital growth since its inception and the Directors expect to commence dividend payments once the Group's Covenant Leverage is below 1.5 times, which following CRH Deal 1 of the CRH Lime Acquisitions, is currently above 2 times. The Directors therefore do not recommend the payment of a dividend for the year (31 December 2022: nil). \n   \n Post balance sheet events \n   \n Post 2023 close we have conducted a series of activities worthy of mention in this Annual Report. Further information is set out in Note 38 . \n   \n This report was approved by the Board on 17 March 2024 and signed on its behalf. \n   \n Garth Palmer \n Chief Financial Officer \n   \n   \n ESG REPORT \n   \n As a business our overall aim is to ensure sustainable returns to our shareholders. As a Group we are committed to ensuring this can be done in a manner where we minimise risks and seize opportunities so that our business continues to be strong in the years to come. \n   \n This year has seen some substantial achievements in terms of ESG: \n   \n ·      71% fossil free electricity across the Group with 100% fossil free electricity in Nordics and Belgium \n ·      35 % alternative energy that including alternative / renewable electricity and biofuels / alternative fuels \n ·      29% GHG emissions intensity reduction from 2021 baseline \n ·      12% YoY energy consumption reduction \n ·      36% and 87% YoY reduction in NOx and SOx respectively \n ·      79% of all our businesses are IOS certified in either ISO9001, ISO14001, ISO45001 \n ·      172 site audits conducted for health and safety \n ·      0 fatalities and cases of silicosis \n ·      6% reduction in total injury frequency rates for employees and contractors on our sites \n ·      >25% reduction in lost time and serious harm frequency rates for employees and contractors on our sites \n ·      >2.5 billion litres of water supplied to local communities \n ·      AA MSCI rating \n ·      Launch of multiple sustainable products \n   \n Following on from our 2023 annual report and standalone annual 2023 ESG Report, we continue to engage with stakeholders and commit to reporting and disclosure of both mandatory and voluntary ESG and sustainability matters. \n   \n   \n SECR - we continue to report our energy consumption and Scope 1-3 greenhouse gas emissions according to the SECR regulations, including non-mandatory aspects to ensure full transparency of our emissions and intensity ratio. \n   \n TCFD - This is the first year we have fully reported against the recommendations and recommended disclosures of the Taskforce on Climate-Related financial disclosures (TCFD), under the Companies (Strategic Report) (Climate-related Financial Disclosure) Regulations 2022. The report was developed in conjunction with external consultants. The report has been reviewed by both the Audit Committee as well as the Company Auditors. \n   \n SASB - we continue to use SASB as a guiding principle for disclosure of metrics that are material to our industry as per the SASB materiality matrix. \n   \n SBTi - In line with our stated ambition, this year we have submitted our Scope 1-3 carbon footprint alongside our emissions reduction targets data to SBTi. We have committed to reducing our Scope 1&2 emissions, and to reducing our Scope 3 emissions, aligned with the ambition and emissions reduction trajectory required to curb global temperature rise to 1.5ºC. \n   \n European Energy Directive - UK ESOS report has been compiled and will be submitted in line with UK submission requirements. \n   \n Sustainability recognition and Commitment - Currently holding a AA rating, we are recognised as a \"Leader\" in our sector by MSCI. This year we registered with CDP and submitted our first Climate Change questionnaire, and await validation of our emissions reduction targets from the SBTi. \n   \n   \n 1.1.        Stakeholder engagement and Materiality Assessment \n   \n We continually engage with a wide array of internal and external stakeholders to identify the key sustainability issues that matter most to the Group and to our core stakeholders. Our findings have guided our ESG journey, through setting strategic sustainability performance targets against each material issue. We report on our progress against the strategic targets set and further information on our Materiality Assessment, including our Materiality Matrix: \n   \n \n \n \n \n Stakeholders \n (in alphabetical \n order) \n \n \n Description \n \n \n How we engage \n   \n \n \n \n \n \n \n Colleagues \n \n \n We have a dedicated workforce of c. 2,000 across the Group. We recognise our dedicated workforce as a key driver of the value derived from the business. Our colleagues are experienced and continuously developed to fulfil their potential. All employees are offered a fair benefits and compensation package relative to their role and level in the organisation. We encourage share ownership where it is available and, where possible, are working to setup where it is not currently in place. \n \n \n Site presence and visual felt leadership. Employee groups and committees and unions. Focus on development training and succession planning. Decentralised approach with flat management allowing easy access to all staff. Employee benefit offerings that can also extend to family members. \n \n \n \n \n Customers and Suppliers \n \n \n All our businesses are decentralised and locally focused so that we know the customers' and suppliers' areas like they do. We work alongside our customers to provide \"right first time\" service and to seek proactive and innovative solutions to support requirements. \"Right first time\" is key to success and ensuring customer loyalty as part of our long-term success. We recognise the huge role our suppliers play in our long-term success. We strive to ensure timely payments and maximise value to support the delivery of our customers' needs. We balance economic requirements with sustainability considerations over the whole supply chain. \n \n \n Prioritise a local focus on both customers and suppliers. Engage directly from our sites so that the customer and supplier deal directly with the site they are supplying or buying from. Ensure timely payments are made to suppliers. Functional and intuitive websites and digital solutions focused on the customer. Ensure adequate checks and due diligence are done on customers and suppliers. \n \n \n \n \n Communities \n \n \n By being decentralised and local we are at the heart of the communities in which we operate allowing us to be good, knowledgeable, supportive and engaging neighbours. \n \n \n Proactive approach and active participation in community and industry working groups, forums and committees. \n   \n \n \n \n \n Investors \n \n \n All our Shareholders play an important role in the continued success of our business. We maintain purposeful and close relationships with them either directly or via wider mediums such as Q&A webinars and conferences. We seek to be transparent and give clear and consistent messages across all communication channels. \n \n \n Dedicated forums such as AGM, annual and interim webinar Q&As and/or interactive investor presentations. Annual and interim reports, trading statements and RNS. Regular phone calls and dialogues. Broker and NED contacts. Site visits, investor roadshows, investor conferences. \n \n \n \n \n Regulators / local Government \n \n \n We look to develop and sustain good relationships with many regulators who govern our businesses to ensure the success of our business and maintaining our license to operate. We are committed to adherence of legal and regulatory requirements. We are committed to have independent review / oversight be it internally or externally. We are committed to a sustainability framework following review of international standards. \n \n \n Regular dialogue with Governments, Government agencies, regulators and industry groups. Active membership of the industry bodies such as Mineral Products Association, Federation Industries Extractives and European Lime Association. Effective and clear policies to ensure governance. Education and training of staff to reinforce compliance with regulations. \n \n \n \n \n   \n   \n   \n   \n 1.2.        CO2 and the Lime Industry and how it varies from cement and other industries. \n   \n To deal with CO 2 , it is crucial to understand how CO 2 is governed and how it is produced. \n   \n 1.2.1.      European Union Emissions Trading System (EUETS) \n   \n The EUETS regulates greenhouse gas emissions of energy and energy-intensive industries as well as inner-European aviation. The EUETS puts a cap on the carbon dioxide (CO 2 ) emitted by business and creates a market and price for carbon allowances. It covers 45% of EU emissions, including energy intensive sectors and approximately 12,000 installations. \n   \n The EUETS works on the 'cap and trade' principle. A 'cap', or limit, is set on the total amount of certain greenhouse gases that can be emitted by factories, power plants and other installations in the system within the cap, and companies receive or buy emission allowances which they can consume or trade as needed. \n   \n An allowance gives the right to emit a tonne of CO 2 , and any allowance surplus to requirement can be accumulated and used to offset future emissions or traded. \n   \n The directive concerning Phase IV (2021-2030) of the ETS entered into force on 8 April 2018. Secondary legislation and guidance documents defining the revised ETS scheme were published in 2023 to align it with the target of a 55 % reduction of EU Green House Gas emissions. The new benchmark values (the value at which the free allowance is set) are below the actual emissions of the covered industries, and this deficit, along with market measures such as a stability reserve held by the EU and the faster reduction in year-on-year allowances drove traded prices in 2023 up to values of €80-€100/tonne, though at the time of publishing they have dropped. \n   \n Recently the Cross Border Adjustment Mechanism (CBAM) was brought in for many industries, including cement. Lime however is not part of CBAM. CBAM is a mechanism whereby importers of materials such as steel and cement into Europe will have to pay a duty / tax to ensure that European business and importers are equally priced with regards to carbon costs. In order for those industries to protect their boundaries, the consequence was to relinquish all free allocation by 2034 compared to allowing allowance to run until the 2050 timeline associated with the current legislation. As previously mentioned, lime is excluded from this and will continue its gradual reduction of free allocation under the existing rules. \n   \n 1.2.2.      Lime Industry and CO2 \n For lime there are sources of CO 2 emissions throughout the production process, however there are two primary sources that make up the majority of CO 2 emissions: fuel and process emissions from the calcination part of the process. \n   \n The calcination process is simply the formula of deriving CaO from CaCO 3 using heat. \n   \n The two main sources of CO 2 from the calcination part of the process are as follows: Combustion CO 2 (~25% to 35%) is produced from the burning of fossil fuels, while process CO 2 (~65% to 75%) results from the actual calcination of limestone. \n   \n All the CO 2 sources have different mitigation solutions. \n   \n Power and energy CO 2 can be reduced through energy efficiency, renewable electricity, fuel efficiency and renewable / alternative fuels. We are actively working on renewable energy solutions and Power Purchase Agreements. \n   \n Combustion CO 2 can be reduced by energy efficiency and fuel selection, as well as by carbon capture utilisation or sequestration (CCUS). We have achieved success with fossil free lime calcination, achieving 100% substitution by biomass at one site. Our first Carbon Capture unit has also been successfully installed and commissioned. \n   \n Process CO 2 can only be addressed by CCUS, with our first Carbon Capture unit having been successfully installed and commissioned. \n   \n   \n 1.2.3.      Carbon capture utilisation or sequestration \n   \n The emissions from lime kilns are well suited to technologies such as CCUS as they have a higher CO 2 content than most post-combustion gases and contain fewer contaminants due to using only limestone as feedstock and, due to product requirements, more stringent fuel quality requirements and typically lower gas filtration temperatures. \n   \n Post-combustion capture (PCC) systems constitute a technically and economically viable solution to reduce emissions in a variety of sectors. Retrofitting existing plants with post-combustion capture units may be the only effective and economically viable way to reduce emissions at the stack, without affecting the process upstream. The availability of a range of commercially ready technologies suitable for different types of CO 2 point sources is crucial for the wide deployment of CCUS systems. Given the wide ranges of plant sizes and flue gas specifications relevant to different emitting sources, it is unlikely that a single technology could fit best in all cases. Therefore, for effective process design, it is convenient to consider multiple technologies and select the most efficient and economically viable option to serve the purpose. \n   \n In addition to the membrane technology currently in use by SigmaRoc, there are a few other options, some of which are more traditional and geared towards large emitters with each solution having their own opportunities and risks: \n   \n ·      Amine scrubbing is acknowledged as the most mature CCUS solution. Absorption-based processes for the separation of CO 2 from flue gases have been widely researched, and their effectiveness has been proven through testing on a variety of scales, from laboratory to commercial. For lime, this solution is both costly and requires a substantial footprint with significant energy consumption and issues with disposal of waste residues. \n ·      Cryogenic capture and separation is a more recent development offered by industrial gas companies as an extension of their in-house process. For Lime, this solution is both costly and requires a substantial footprint with significant energy consumption. \n   \n SigmaRoc believes that membrane technology is optimally suited to our single kilns / small cluster of kilns due to the proven technology, small footprint, low capital and operating costs and high efficiencies. For our sites that have multiple kilns with larger emission volumes, carbon capture can be done via membrane, but also by other technologies, allowing a flexible approach to carbon capture based on the site, infrastructure and country policies and legislation. \n   \n Other technologies, that may be more suited to the SigmaRoc kiln network, are being trialled and investigated including Ocean GeoLoop which employs an all-electric pressure swing process for CO2 capture where a trial plant designed to capture 10,000 tonnes of CO2 is to be established with Nordkalk's joint venture partner in Norway. \n   \n This allows the Company to constantly select the best option for both its operations and its operating jurisdictions. \n   \n   \n 1.3.        Overall Performance \n   \n 1.3.1.      Road Map to Net Zero \n   \n \n \n \n \n ESG \n \n \n Subject \n \n \n Target \n \n \n Date \n \n \n Progress to date \n \n \n Status \n \n \n \n \n \n \n Environment \n \n \n Carbon \n \n \n All concrete products available in low carbon and ultra-low carbon. \n \n \n 2025 \n \n \n 100% of concrete products available in low carbon and ultra-low carbon. \n \n \n Achieved 2023 \n \n \n \n \n Carbon capture storage and utilisation trial plant operational. \n \n \n 2025 \n \n \n First module commissioned and operational. \n \n \n Achieved 2023 \n \n \n \n \n Alternative fuels used in mobile equipment. \n \n \n 2030 \n \n \n One site is running 100% fossil free. \n \n \n On Track \n \n \n \n \n Alternative fuels used in fixed equipment (e.g. lime and asphalt). \n \n \n 2032 \n \n \n 100% fossil fuel substitution achieved on vertical lime kiln using biofuel \n >50% fossil fuel substitution achieved on rotary lime kiln using biofuel with potential to go to 100% upon completion of remaining biofuel project \n \n \n On Track \n \n \n \n \n All kilns are carbon neutral. \n \n \n 2038 \n \n \n CCUS system commissioned and capture taking place at initial kiln. \n Corporation with JV partner on all-electric pressure swing process CCUS at the Norwegian site. \n \n \n On Track \n \n \n \n \n Net-zero. \n \n \n 2040 \n \n \n \n \n \n On Track \n \n \n \n \n Energy intensity and efficiency \n \n \n 2.5% reduction in energy intensity. \n \n \n 2030 \n \n \n 12% YoY energy intensity reduction in 2023 \n 29% reduction in energy intensity from 2021 baseline \n \n \n Achieved \n \n \n \n \n 100% third party energy sourced from renewable means. \n \n \n 2030 \n \n \n 100% of electrical energy sourced from fossil free means in Nordics and Belgium \n 71% of Group electrical energy sourced from fossil free means \n \n \n On Track \n \n \n \n \n Resource utilisation and circular economy \n \n \n 100% of all manufactured products can utilise waste / recycled materials. \n \n \n 2025 \n \n \n 100% of our manufactured products (where specification allows) can use recycled products \n   \n This includes products such as asphalt, concrete, and concrete products which are already using, where specification allows, waste / recycled materials such as nappies, RAP, PFA, GGBS and recycled aggregates. \n \n \n Achieved 2023 \n \n \n \n \n 100% utilisation of all production materials. \n \n \n 2027 \n \n \n Nordkalk Next, Nordkalk Complete , Puccini Blue, Mevo, Greenbloc, Aggregates reprocessing, and Concrete Product mix designs are key examples of where we are driving towards 100% utilisation of all our production materials. \n   \n \n \n On Track \n \n \n \n \n   \n 1.3.2.      Environment \n   \n \n \n \n \n Pillar \n \n \n Key Focus Area \n \n \n Link to UN SDG \n \n \n Targets \n \n \n How Did we do \n \n \n Focus for 2024 \n \n \n \n \n \n \n Environment \n \n \n Sustainable use of reserves and resources. \n \n \n Goal 12: Responsible consumption & production \n Goal 13: Climate Action \n \n \n Achieve Carbon net-zero road map targets. \n   \n Reduction in energy intensity and increase in energy efficiency. \n   \n Maximisation of resource utilisation and circular economy. \n \n \n First Carbon Capture plant installed and commissioned \n   \n Installation and commissioning of a new wash plant offering premium washed aggregates previously designated as waste, in turn releasing approximately 5 million tonnes of limestone. \n   \n Creation of Puccini Blue to allow utilisation of up to 100% of the material extracted from our dimension stone quarries. \n   \n 100% fossil fuel substitution in lime kiln at an operating site. \n   \n First fossil free site \n  created. \n   \n UK ESOS completed, ready for submission to authorities. \n   \n Energy surveys completed across platforms that have found multiple opportunities and savings. \n   \n  Further solar installations and tendering for installation of wind energy. \n   \n Partnership with Mevo \n Achieve low and ultra low carbon offering across all our Concrete Products \n   \n Nordkalk Next, Nordkalk Complete and Puccini Blue offering s in drive to sustainable products across our other businesses \n   \n Submission of SBTi \n   \n Use of OneClick for creation of LCAs and EPADs \n \n \n Incorporation of new business into our ESG Road map \n   \n Continue to focus and accelerate where possible our net-zero road map targets. \n   \n Continue energy and fuel optimisation to reduce the reliance on fossil fuels. \n   \n   \n   \n \n \n \n \n Environment \n \n \n Responsible use key resources including raw material, mineral and water. \n \n \n Goal 12: Responsible consumption & production \n Goal 13: Climate Action \n \n \n \n \n Environment \n \n \n Optimise energy use and minimise impact of our operations on the environment. \n \n \n Goal 12: Responsible consumption & production \n Goal 13: Climate Action \n \n \n \n \n Environment \n \n \n Contribute to sustainable construction and address environmental aspects either through product production or use. \n \n \n Goal 9: Industry, innovation & infrastructure \n Goal 12: Responsible consumption & production \n   \n \n \n \n \n   \n 1.3.3.      Social \n   \n \n \n \n \n Pillar \n \n \n Key Focus Area \n \n \n Link to UN SDG \n \n \n Targets \n \n \n How Did we do \n \n \n Focus for 2024 \n \n \n \n \n \n \n Social \n \n \n Ensure people leave work in the same or better condition than when they arrived. \n \n \n Goal 3: Good health & wellbeing \n Goal 8: Decent work & economic growth \n \n \n Total injury frequency rate and harm injury frequency rate reduction year on year. \n   \n Increase workforce engagement and retention. \n   \n Increase board diversity. \n   \n \n \n Improved safety performance with a notable 31% and 25% reduction in SHIFR and LTIFR respectively. This data is not just limited to employees, but included all those that work on our sites including contractors. \n   \n 172 site safety audits conducted by Group Health & Safety Director \n   \n Initiation and roll out of PEPtalk across UK business \n   \n Completion of initial Front Line Supervision initiative to ensure Supervisors spend optimal time managing safety, quality and productivity.  \n   \n Supervisor training to at least IOSH Managing Safely level.     \n   \n   \n   \n \n \n Increase Group audit team across the platform. \n   \n Continual roll out of supervisor alignment programme for Health & Safety. \n   \n Continued focus on 3 core Health & Safety areas: Structure & Compliance; Proactive Prevention; and Learn & Improve. \n   \n Continue to work with government agencies, education establishments and communities to offer long term employment opportunities. \n   \n   \n   \n \n \n \n \n Social \n \n \n Support the physical and mental health of our employees and their families. \n \n \n Goal 3: Good health & wellbeing \n \n \n \n \n Social \n \n \n Attract, train, retain and engage our workforce. \n \n \n Goal 4: Quality Education \n Goal 8: Decent work & economic growth \n \n \n \n \n Social \n \n \n Be a good neighbour; Source local, buy local, sell local, invest local. \n \n \n Goal 11: Sustainable cities & communities \n \n \n \n \n   \n   \n 1.3.4.      Governance \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Governance \n \n \n Promote QCA and Corporate Governance Codes \n \n \n Goal 16: Peace, justice & strong institutions \n \n \n Continue to implement, and transparently disclose, compliance and matters relating to ESG. \n   \n Maintain ongoing compliance in a dynamic environment across multiple jurisdictions. \n   \n   \n   \n \n \n Appointment of Tom Jenkins as Head of Investor Relations \n   \n Formalisation of Formity across the Group to ensure governance training and compliance. \n   \n Engagement of CEN-ESG to conduct gap analysis and peer review report that identified opportunities to improve our policies and governance \n   \n Completion of first TCFD report \n   \n \n \n 100% compliance target on Formity training and acknowledgement for Group polices across the Group \n   \n Creation of dedicated ESG Board Committee \n   \n Quarterly ESG reporting to Board and ESG Committee \n   \n Continued interaction with institutional investors' ESG & Stewardship analysts to ensure compliance with reporting requirements. \n   \n   \n   \n \n \n \n \n Governance \n \n \n Ensure proactive Board oversight and independence of committees \n \n \n Goal 16: Peace, justice & strong institutions \n \n \n \n \n Governance \n \n \n Focus on Risk Management and mitigation, including cyber \n \n \n Goal 16: Peace, justice & strong institutions \n \n \n \n \n Governance \n \n \n Ensure transparency on reporting and Tax \n \n \n Goal 16: Peace, justice & strong institutions \n \n \n \n \n   \n 1.3.5.      SASB \n   \n SASB provides industry-specific standards for disclosing performance on sustainability topics including, but not limited to, climate in a comparable manner that are reasonably likely to have a material effect on financial performance of companies in each industry. \n   \n   \n \n \n \n \n SASB Topic \n \n \n Accounting Metric \n \n \n Category \n \n \n Unit of Measure \n \n \n Code \n \n \n 2023 Result \n \n \n \n \n Greenhouse Gas Emissions \n \n \n Gross global Scope 1 emissions, percentage covered under emissions-limiting regulations \n \n \n Quantitative \n \n \n Metric tonnes (t) CO ₂ -e, Percentage (%) \n \n \n EM-CM-110a.1 \n \n \n 662,135 tCo2e \n   \n   \n \n \n \n \n Greenhouse Gas Emissions \n \n \n Discussion of long-term and short-term strategy or plan to manage Scope 1 emissions, emissions reduction targets, and an analysis of performance against those targets \n \n \n Discussion and Analysis \n \n \n n/a \n \n \n EM-CM-110a.2 \n \n \n   \n   \n   \n \n \n \n \n Air Quality \n \n \n Air emissions such as: \n \n \n Quantitative \n \n \n Metric tonnes (t) \n \n \n EM-CM-120a.1 \n \n \n \n \n \n \n \n (1) Nox, \n \n \n 447 \n \n \n \n \n (2) Sox, \n \n \n 196.3 \n \n \n \n \n Energy Management \n \n \n (1) Total energy consumed, \n \n \n Quantitative \n \n \n Gigajoules (GJ) Percentage (%) \n \n \n EM-CM-130a.1 \n \n \n 4.3m GJ of energy \n   \n \n \n \n \n (2) percentage grid electricity, \n \n \n 15% from grid electricity \n \n \n \n \n (3) percentage alternative, \n \n \n 35% alternative energy that includes alternative / renewable electricity and biofuels / alternative fuels \n   \n \n \n \n \n (4) percentage renewable \n \n \n 5% renewable energy that includes renewable electricity and biofuel \n \n \n \n \n Water Management \n \n \n Total fresh water withdrawn, \n \n \n Quantitative \n \n \n Thousand cubic meters (m.) Percentage (%) \n \n \n EM-CM-140a.1 \n \n \n 34,000k m3 of water is managed that includes dewatering processes from seasonal snow melt water, rain water collection etc \n   \n Of the water managed 2%, 748k m3, is used for operational purposes which is a mix of fresh water, recycled and collected. \n   \n Of the water managed 8%, >2,5m m3, is allocated to local communities for drinking water purposes. \n \n \n \n \n Waste Management \n \n \n Amount of waste generated \n \n \n Quantitative \n \n \n Metric tonnes (t) \n \n \n EM-CM-150a.1 \n \n \n 2,787,498t generated of which 88% is recycled \n   \n   \n This is predominantly related to overburden removal at quarries. These materials are often stored or used for restoration purposes including the recultivation of indigenous soils for remediation. The creation of new business is also looking to use surplus material into other business streams and therefore reprocess historical and future material once deemed waste. \n \n \n \n \n Biodiversity Impacts \n \n \n Description of environmental management policies and practices for active sites \n \n \n Discussion and Analysis \n \n \n n/a \n \n \n EM-CM-160a.1 \n \n \n   \n   \n \n \n \n \n Biodiversity Impacts \n \n \n Terrestrial acreage disturbed; percentage of impacted area restored \n \n \n Quantitative \n \n \n Acres (ac) Percentage (%) \n \n \n EM-CM-160a.2 \n \n \n 5,287 acres of land is disturbed which accounts for about 48% of our land holdings. \n   \n 17% of disturbed land was restored or is under restoration program \n \n \n \n \n Workforce Health & Safety \n \n \n Total recordable incident rate (TRIR) \n \n \n Quantitative \n \n \n Rate \n \n \n EM-CM-320a.1 \n \n \n Data has historically been collected as an amalgamation for Direct Employee, Contract employee and external contractors as it is believed that we are responsible for all those on our site regardless of employment status. \n   \n \n \n \n \n Workforce Health & Safety \n \n \n Number of reported cases of silicosis \n \n \n Quantitative \n \n \n Number \n \n \n EM-CM-320a.2 \n \n \n None \n   \n   \n \n \n \n \n Product Innovation \n \n \n Total addressable market and share of market for products that reduce energy, water and/or material impacts during usage and/or production \n \n \n Quantitative \n \n \n Reporting currency Percentage (%) \n \n \n EM-CM-410a.2 \n \n \n Market share is not a straightforward number to capture given all the industries and end markets we operate in however in the Greenbloc and Sustainability sections we clearly show how construction material product innovation is being driven. \n   \n \n \n \n \n Pricing Integrity and Transparency \n \n \n Total amount of monetary losses as a result of legal proceedings associated with cartel activities, price fixing, and anti-trust activities \n \n \n Quantitative \n \n \n Reporting currency \n \n \n EM-CM-520a.1 \n \n \n £0 \n   \n Zero \n   \n   \n \n \n \n \n   \n   \n 1.4.        Case Studies \n \n 1.4.1.    Aqualung update and NorFraKalk \n   \n In 2023, SigmaRoc successfully installed and commissioned its first carbon capture unit at Nordkalk's site in Köping, Sweden. The fully scalable carbon capture system, utilising Aqualung's innovative membrane technology, is the first-ever implementation of its kind in the industry. \n   \n The carbon capture system has been developed by Aqualung, a leading provider of membrane-based carbon capture and separation technology, based in Norway. \n   \n Over the course of the preceding year, SigmaRoc reviewed an array of technologies including amine absorption, solid absorption, membrane and cryogenic. The Aqualung membrane technology was considered best suited for the Group's operations based on the following factors: small footprint, low CapEx and operating costs, and a relatively low complexity and efficient solution. The system is modular and fully scalable, allowing SigmaRoc significant flexibility in the roll out of the solution. \n   \n The Aqualung module installed in Köping can capture up to 25% of the process emissions emitted from a standard kiln and was initially designed as a 'catch and release' system to demonstrate the durability and efficiency of the membranes. The unit is able to capture CO2 with a purity of 96% through just 2 stages. \n   \n The unit has been connected to a pilot purification module to simulate settings required to produce higher purities of CO 2 for different end use applications that go beyond sequestration requirements. We believe review of alternative application is required whilst European Governments and third parties develops legislation, policies and sequestration infrastructure including pipeline, storage facilities and portside facilities to allow for commercially available sequestration. \n   \n SigmaRoc is working with various businesses and solution providers with regards to the end use of CO 2 , including being involved with the NICE (Norvik Infrastructure CCS East Sweden) project to explore all CO 2 utilisation and sequestration options. \n   \n Nordkalk also secured part-funding from the Swedish Energy Agency for the implementation and scaling of the Köping carbon system with the intention to capitalise on the learning from the engineering, commissioning and operation phase of the initial module. \n   \n As part of the Groups JV, Norfrakalk in conjunction with Ocean GeoLoop are initiating an industrial trial plant designed to capture 10,000 tonnes of CO2 in Norway using an all-electric pressure swing process. \n   \n   \n 1.4.2.    Biodiversity \n   \n The concept of dynamic biodiversity management combines integrated management of the operation of an active quarry with dynamic preservation, management and restoration measures for species and habitats. This principle makes it possible to integrate the populations of species present in the quarry into a network of habitats ensuring constant availability of environments conducive to their development. \n   \n We have integrated the dynamic management of biodiversity into its extraction activity as part of the Life in Quarries project and have conducted annual monitoring to assess the structure and functionality of the habitats created. Since 2020, in Belgium we have ensured compliance with a management plan in response to local biological issues using the tools and skills acquired as part of the Life in Quarries project. A summary of activities in 2023 is set out below: \n   \n \n \n \n \n ACTION UNIT \n \n \n commitment \n \n \n Current \n \n \n Active \n \n \n \n \n Pioneer ponds (nb) \n \n \n 15 \n \n \n 18 \n \n \n 18 \n \n \n \n \n Mineral pioneer lawns (ha) \n \n \n 1.5 \n \n \n 1.72 \n \n \n 1.72 \n \n \n \n \n Swallow cliffs (nb) \n \n \n 1 \n \n \n 2 \n \n \n 2 \n \n \n \n \n Solitary bee slope (nb) \n \n \n 1 \n \n \n 1 \n \n \n 1 \n \n \n \n \n Various shelters (nb) \n \n \n 10 \n \n \n 14 \n \n \n 14 \n \n \n \n \n Permanent ponds (nb) \n \n \n 10 \n \n \n 15 \n \n \n 15 \n \n \n \n \n Gentle sloping banks (m) \n \n \n 50 \n \n \n 52.53 \n \n \n 52.53 \n \n \n \n \n Gull platforms (nb) \n \n \n 2 \n \n \n 5 \n \n \n 5 \n \n \n \n \n Artificial bat galleries (nb) \n \n \n 1 \n \n \n 1 \n \n \n 1 \n \n \n \n \n Historic bat galleries (nb) \n \n \n 1 \n \n \n 1 \n \n \n 1 \n \n \n \n \n   \n During 2023, specific training was given by the University of Gembloux on two areas: \n   \n Pollinators \n Career pollinators and the awareness about the disappearance of wild bees which are essential for biodiversity and a large part of the crops intended for our food. Pollinators need quality food resources at each stage of their life, winter nesting sites, construction materials for nesting and shelter to protect themselves from the wind and predators all whilst considering light pollution. \n   \n Planting hedges in Quarries \n With their gradual disappearance throughout the country, hedges have taken away the multiple roles they fulfilled. They have local and regional ecological importance by diversifying the landscape and providing habitat and food resources for many species. They fulfil other roles of ecological connectivity and provide a range of ecosystem services, shading, fight against runoff, improvement of soil quality. They also support the quarry in other services: fight against erosion, protective barrier, sound insulation. They can constitute an additional opportunity to contribute to the conservation of Biodiversity in the quarry. \n   \n   \n 1.4.3.    Waste reuse & Circular Products \n   \n Circular solutions have been a large focus in 2023 with the extension and launch of several sustainable product lines, such as Greenbloc, Mevo, MTech, Puccini Blue, Nordkalk Next and Nordkalk Complete on industrial scales. \n   \n Mevo \n Mevo is a revolutionary new technology for the grinding and blending of non-cementitious minerals, imparting certain binding properties to the materials. The Company has supported Mevo in raising £15m in venture funding and has assisted in the construction of its first large-scale plant. Once operational, we anticipate that Mevo's technology will be at the forefront of decarbonising all our concrete products.  \n   \n Greenbloc \n Through 2023 Greenbloc technology has made significant strides in sustainable development across the business, offering up to 50% carbon reduction on all standard blocks produced at CCP Building Products. This has saved over 6,000 tonnes of CO 2 since its introduction and has been offered at no additional cost to the customer. CCP completed its expanded new ranges by introducing an additional premium range product, which sits between its standard 50% reduction product and ultra cement-free and provides up to a 70% carbon reduction at a competitive price. \n   \n Greenbloc can now be incorporated in almost all of our concrete products, available in three distinct performance levels. These levels provide a range of embodied CO 2 reductions from 50% to 90%. Greenbloc is a flexible solution, enabling daily production and the ability to turn cement-free concrete on-and-off for environmentally significant bespoke projects. These include the UK Environmental Agency's Canvey Island Sea Defence and Jimmy's Farm Polar Bear Relocation projects, both of which achieved over 80% reduction in the carbon embodiment of the concrete products. As a result of these initiatives, we have become one of the leading UK producers of cement-free pre-cast concrete, producing more wet-cast cement-free concrete per day than any other precast company, and underscoring the industry's shift towards more sustainable practices. The resulting media focus has brought more cement-free projects to the business for 2024. Looking ahead, we aim to surpass the 100% mark, positioning ourselves as pioneers in producing large-scale negative carbon concrete products. \n   \n A leap in innovation was gained through the production of a carbon-negative-cement-free concrete block, which boasted a 115% carbon reduction and was created using Greenbloc cement-free technology, combined with carbon-negative aggregate produced from waste materials and captured carbon. The block showed all the same characteristics and performance as standard equivalent cement-based blocks and is expected to become part of an extended future range with the introduction of Mevo at CCP in 2024 \n   \n MTech \n SigmaRoc has produced an in-house cement-free-carbon-negative concrete with patentable opportunities, in collaboration with Marshalls. The concrete combines carbon-negative materials with an in-house developed cement-free binder which incorporates upcycled waste lime kiln dust from Nordkalk. The patent application will be submitted in 2024 with expected opportunities for use in 2025. \n   \n Puccini Blue \n Developed by John Vis (Commercial Director of Carrieres du Hainaut) and Chris Vermorken (Legal and Operational Advisor) with the help of Elisa Frenay (Group Marketing Lead), Puccini Blue is a revolutionary new way to maximise quarry yield by making the fault lines of products a distinctive and highly desirable feature through resin technology. Material that once had to be separated due to natural fault lines and therefore producing less yield, can now be processed to ensure structural integrity of the fault lines to maximise not only the yield, but the aesthetic product offering so desirable to our customers. \n   \n Nordkalk Next \n A product offering where at least 33% of the material used is reusable material, own or external, that is not used or is considered waste. Further, 33% of energy used in production is fossil free. This is considered as per energy content.  \n   \n Nordkalk Complete \n A product offering where 100% of the material used is material, own or external, that is not used or is considered waste. CO 2 neutral scope 1 and scope 2. \n   \n 1.4.4.    Sustainable Products \n   \n We are proud to be working in collaboration with a series of partners on the development of products that promote sustainability, such as the EcoTile, that creates spaces within the fabric of our cities and towns in which multiple species can survive and thrive, and where humans can interact and engage safely with nature. Initial trials showed that a multitude of species settled where they were expected to, and in the design features - the multispecies design works. \n   \n In 2023, Nordkalk introduced seven innovative, sustainable products and solutions across a diverse range of applications. A brand-new range of fossil-free products was launched in Ignaberga, Sweden, marking a significant step forward in the company's commitment to sustainability. Additionally, more efficient soil improvement products specifically designed for agricultural purposes were developed for the Swedish market. In the construction sector, Nordkalk developed two novel fillers: an ultrafine product aimed at reducing the use of cement and additives in plasters, and another product designed to minimise the bitumen content in roofing materials. \n   \n   \n 1.4.5.    Our People and PepTalk \n   \n The way in which companies measure the \"S\" in ESG or their social impact has a significant effect on the wellbeing of their employees, the wider community and the organisation's stakeholders. The significance of measuring and reporting social risks and impacts is underscored by the presence of social inequalities and the necessity for a transition to a sustainable economy. Prioritising employee wellbeing and the internal culture of organisations is becoming increasingly important in today's society and are essential metrics for the \"S\" in the ESG strategy as employee wellbeing is central to an organisation's social performance. \n   \n In 2023 SigmaRoc incorporated PepTalk into its UK ESG strategy to enhance employee engagement and well-being. PepTalk provides a data-led engagement platform to improve psychological safety, enhance employee morale and reduce attrition. The integration of PepTalk aligns with their commitment to enhancing employee wellbeing and contributes to a positive corporate culture. \n   \n PepTalk supports our Social Responsibility strategy as follows: \n   \n ●    Employee Wellbeing: providing a safe, inclusive workplace and offering a tool such as PepTalk's platform and program that can help in delivering regular training and development opportunities to foster professional growth. \n ●    Employee Satisfaction & Feedback: measurement of employee satisfaction and the success of wellbeing initiatives. \n ●    100% reach: modern technology enables a dispersed team to stay connected through a wide range of content-led program and actions plans that are designed to support team connection and engagement. \n ●    Expert-led Wellbeing and Culture Calendar: rolling wellbeing and culture content calendar, designed in partnership with industry experts and thought leaders that enables employees to perform at their best. \n ●    Team Building Initiatives: customised competitions across wellness and activity designed to drive employee connection and collaboration. \n ●    Behavioural Change Programs: behavioural change programs and interventions for managers and team members to address potential inhibitors to engagement and promote learning and skill building. \n ●    Leadership Tools: supporting managers to work on building psychological safety, trust and authenticity with their teams.  \n   \n   \n 1.5.        Environment \n   \n 1.5.1.      Carbon Emissions \n   \n 1.5.1.1.        Targets & Performance \n   \n \n \n \n \n Baseline Year \n \n \n Target Year \n \n \n Target description \n \n \n Target reduction \n \n \n Status \n \n \n \n \n 2021 \n \n \n 2040 \n \n \n Net zero by 2040 \n \n \n 100% \n \n \n On Target \n   \n 7% YoY emissions reduction in 2023 \n   \n 12% emissions reduction since the 2021 baseline \n \n \n \n \n 2021 \n \n \n 2038 \n \n \n All kilns are carbon neutral by 2038 \n \n \n 100% \n \n \n On Targe t \n   \n 100% fossil fuel substitution achieved at site \n   \n Carbon capture module installed and commissioned \n \n \n \n \n 2021 \n \n \n 2030 \n \n \n 2.5% reduction in energy intensity by 2030 \n \n \n 2.5% \n \n \n Achieved \n   \n 12% YoY achieved in 2023 \n   \n 29% overall reduction since the 2021 baseline \n \n \n \n \n 2021 \n \n \n 2030 \n \n \n 100% third party energy sourced from renewable means by 2030 \n \n \n \n \n \n On Target \n   \n 100% of Belgium, Finland and Sweden use alternative / renewable electrical energy \n   \n 71% of Group uses alternative / renewable electrical energy \n \n \n \n \n   \n As we go through the SBTi verification process, the Group will develop defined targets. \n   \n The SECR report is conducted in line with 2019 UK Government Environmental Reporting Guidelines and the GHG Protocol Corporate Accounting and Reporting Standard (revised edition) and covers all operations where we have operational control. The SECR report also includes both mandatory and voluntary reporting to ensure transparent disclosure. \n   \n GHG Emission metric tonnes CO2e \n   \n \n \n \n \n Year \n \n \n 2021 1 \n \n \n 2022 \n \n \n 2023 \n \n \n \n \n Total tCO2e \n \n \n 750,586 \n \n \n 709,020 \n \n \n 662,134 \n \n \n \n \n Year on Year reduction \n \n \n \n \n \n 6% \n \n \n 7% \n \n \n \n \n 2021 baseline reduction \n \n \n \n \n \n \n \n \n 12% \n \n \n \n \n   \n GHG emissions intensity \n   \n \n \n \n \n Year \n \n \n 2021 1 \n \n \n 2022 \n \n \n 2023 \n \n \n \n \n Total tCO2e per £m Revenue \n \n \n 1,617.6 \n \n \n 1,317.9 \n \n \n 1,141.1 \n \n \n \n \n Year on Year reduction \n \n \n \n \n \n 19% \n \n \n 13% \n \n \n \n \n 2021 baseline reduction \n \n \n \n \n \n \n \n \n 29% \n \n \n \n \n   \n Energy Consumption \n   \n \n \n \n \n Year \n \n \n 2021 1 \n \n \n 2022 \n \n \n 2023 \n \n \n \n \n Total mWh \n \n \n 1,340,619 \n \n \n 1,258,477 \n \n \n 1,193,958 \n \n \n \n \n Year on Year reduction \n \n \n \n \n \n 6% \n \n \n 5% \n \n \n \n \n 2021 baseline reduction \n \n \n \n \n \n \n \n \n 11% \n \n \n \n \n   \n Energy Intensity \n   \n \n \n \n \n Year \n \n \n 2021 1 \n \n \n 2022 \n \n \n 2023 \n \n \n \n \n Total mWh per £m Revenue \n \n \n 2,889.2 \n \n \n 2,339.2 \n \n \n 2,057.6 \n \n \n \n \n Year on Year reduction \n \n \n \n \n \n 19% \n \n \n 12% \n \n \n \n \n 2021 baseline reduction \n \n \n \n \n \n \n \n \n 29% \n \n \n \n \n   \n 1 Emissions based on SECR reports including both Mandatory and Voluntary data. To allow like for like comparisons, 2021 data was adjusted for Nordkalk (the North East region) which was reported for a full 12 months in 2021 (despite joining SigmaRoc in September 2021) and 2022 to provide comparable annual emissions for the Group \n   \n   \n 1.5.1.2.        Mitigation \n   \n The 3 focuses areas for 2023 were: \n - Scope 1 - commissioning of the Company's first modular Carbon Capture system \n - Scope 2 - improvement of energy use and energy intensity and sourcing of alternative energy \n - Scope 3 - continual development of sustainable products \n   \n The commissioning of the Company's first modular Carbon Capture system and continual development of sustainable products helping recue scope 1 and scope 3 emission. The modular plant is now commissioned and able to capture with a purity of 96% through just 2 stages. Subject to finding a commercial outlet for the CO2, the Company is in a position to expand the roll out of the system. Whilst Governments and third parties continue to try to develop necessary policies and infrastructure for transport and sequestration of CO2, the Company is proactively identifying independent transportation systems that can utilise road and rail as well as internal and external CO2 uses such as the sequestration of CO2 into our own concrete products to support Greenbloc and Mevo technology. \n   \n The Company has engaged with a series of mandatory and voluntary programmes to focus on the reduction of emissions intensities. These include reporting to CDP as well as submission to SBTi of which we are awaiting the verification process. \n   \n Additional initiatives include completion of our ESOS report which is part of the European Energy Directive and the submission of our annual SECR report that looks at both mandatory and voluntary reporting aspects and is a guide to focus areas. \n   \n   \n 1.5.2.      Toxic Emissions and Waste \n   \n 1.5.2.1.        Governance and Strategy \n   \n Environmental Management Systems (EMS) are key to ensuring management of toxic emissions and waste. Across our businesses, 76% of our businesses (by revenue) have an ISO14001 certified Environmental Management System (EMS) that also include provisions for waste management with no fines being incurred in 2023. \n   \n Our EMSs, including our 14001 audited EMS are regularly audited by external auditors as well as additional specialised audits conducted by the likes of MCA and Lloyds Register for aspects such as MARPOL (the International Convention for the Prevention of Pollution from Ships.) \n   \n 1.5.2.2.        Targets & Performance \n In terms of air quality, our NOx and SOx performance has seen a significant step change reduction. This has been achieved through a combination of kiln network balancing and the use of Selective Non Catalytic Reduction (SNCR) systems. \n   \n \n \n \n \n \n \n \n 2022 \n \n \n 2023 \n \n \n YoY Reduction \n \n \n \n \n NOx \n \n \n 699 \n \n \n 447 \n \n \n 36% \n \n \n \n \n SOx \n \n \n 1544.19 \n \n \n 196.3 \n \n \n 87% \n \n \n \n \n   \n   \n 1.5.3.      Biodiversity and Land Use \n   \n 1.5.3.1.        Policy \n   \n SigmaRoc operates a series of policies that include: \n -       Sustainability Policy \n -       Environment and Water Policy \n -       Biodiversity Policy \n -       Energy and Climate Policy \n   \n These include provisions and commitments on sustainably managing natural resources and raw materials, minimising disturbance from operations and reclaiming habitat and disturbed land. \n   \n The Board has overall responsibility for the Policies and approves the policies which are then cascaded throughout the business with a formal acknowledgement and training program to be rolled out in 2024 to all employees and contractors as required. These will be monitored and audited quarterly by the Board with a target of 100% compliance for employees in terms of acknowledgement and training. \n   \n 1.5.3.2.        Program and Structures \n   \n Restoration and Rehabilitation \n   \n As part of site planning and permits, most government agencies and authorities require restoration plans to be in place. These restoration plans cannot be completed until the operations have come to end of life, however where there is an opportunity, our sites work concurrently to restore areas that are no longer operational. \n   \n Despite the Group operating over a large area of approximately 5,287 acres, with 17% having been restored or under restoration restored in line with local authorities and community requirements. \n   \n Protection of natural ecosystems \n   \n Even before a point of final restoration, our sites work closely with local authorities, working groups and communities to ensure we maximise not only the preservation of existing ecosystems, but often the generation of further eco-systems to provide a thriving environment for existing species but also previously extinct species. This includes both fauna and flora with success derived through programs such as flora relocation programmes, wildflower programs, Red Bill chough breeding programs, Peregrine falcon nesting programs and great crested newt habitat establishment. \n   \n   \n Some sites are close to Sites of Specific Scientific Interest where our working relationships with local groups and national agencies have helped ensure they thrive. Where there is risk of impact, the valuable species are moved to other suitable or created areas. \n   \n 1.5.3.3.        Biodiversity and Community Impact \n   \n The Company works closely with communities and local authorities to ensure that our ongoing operations and future operations minimise environmental and community impact. Our future works are supported by impact assessments prior to the commencement of work. \n   \n Operational considerations not only seek to minimise impact, but also actively enhance biodiversity in surrounding areas. \n   \n Before commencing operation of a site, the potential environmental, including bio diversity, and social impacts are assessed through an Environmental Impact Assessment process, after which an application for an environmental permit is typically made. \n   \n During the operating phase of the sites, environmental management is guided by environmental permits, which set regulatory requirements for the operation and closure, and by the environmental management system of the Company including ISO14001. \n   \n The Group is committed to minimising its impact on the natural environment where it operates. We integrate biodiversity management into all steps of planning, production and closure of sites whilst maintaining a hierarchy of mitigation (avoid, minimize, restore, and finally offset). \n   \n 1.5.4.      Water management \n   \n Our operations manage over 34,000k m 3 of water per year including fresh water, seasonal snow melt water, rainwater collection and run off. \n   \n Of the water managed, 2%, 748k m3, is used for operational purposes which is a mix of fresh water, recycled and collected. \n   \n Furthermore, 8%, 2.5m m3, is allocated to local communities for drinking water purposes. \n   \n   \n 1.6.        Social \n \n 1.6.1.      Community Relations \n   \n 1.6.1.1. &nbsp...

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