Annual Report for the year ended 31 December 2024

Annual Report 2024

Annual Report and Accounts for the year end December 2024

Contents Section 1 Strategic Report

Financial Highlights 2

In Year Highlights 3

Flowtech at a Glance 4

Chairman's Statement 6

The Value We Bring 9

Our CEO Review 11

Our Strategic Plan 15

Our Six Growth Engines 17

Our Performance Improvement Plan 19

Environment, Social and Governance (ESG) 21

Section 2 Governance

Corporate Social Responsibility 28

Financial Review 32

Managing Our Risks 35

Our Board 39

Corporate Governance Report 41

Directors' Remuneration Report 47

Directors' Report 50

Section 3 Financial Statements

Financial Report

Glossary of Terms

Independent Auditor's Report 54

65

109

Section 1 Strategic Report

Financial highlights

2024

Revenue

Gross profit %

£107.3M

(2023: £112.1m)

38.2%

(2023: 36.8%)

Underlying EBITDA*

£5.9M

(2023: £9.4m)

Net cash from operating activities

£8.7M

(2023: £8.2m)

Underlying operating profit*

£2.7M

(2023: £6.0m)

Net debt**

£15.1M

(2023: £14.7m)

Operating loss

-£25.2M

(2023: -£10.4m)

Final dividend

Nil

(2023: 2.2p)

* Underlying operating profit is used as an alternative performance measure to assess the trading performance of the business and is operating profit before separately disclosed items which are amortisation and impairment of intangibles, impairment of goodwill, impairment of right of use assets, share based payments, and restructuring costs. The £3.2m differential between underlying operating profit and underlying EBITDA relates to depreciation charges.

**Net debt is bank debt less the value of cash and cash equivalents. It excludes lease liabilities under IFRS16. Bank debt is the value of the Barclays Revolving Credit Facility of £20m and any utilised value of the £5m overdraft facility, less any unamortised value of loan arrangement fee.

2

In year highlights

Customer

Growth

High customer retention with like for like customer numbers remaining stable in a challenging market.

Continued customer service and operational improvements resulted in customer complaints reducing by a further 27% on top of the 50% reduction seen in H2 23.

Increased website traffic resulted in online orders growing by 2% (FY23: 170.1K vs

FY24: 173.6K) with the percentage of online

orders now at over 70% of our product distribution channel (up 5% on FY23) and now up to 26% of total revenues.

Creation and delivery of over 53,000 new Flowtech catalogues to market.

Orderbook increased by 5.1% against December 23 despite weaker external market. Sales pipeline quality and value materially improved during the year with a number of new contracts secured to

underpin 2025 growth.

Commercial Excellence

Further focus on commercial discipline resulted in continued gross margin increase of 142bps.

Continued reduction in inventory levels by an underlying £3m, whilst maintaining 97%

service availability demonstrating increased operational effectiveness.

Direct and indirect procurement cost reduction of £1m as we scale up the full buying power across the Group.

Product & Service Expansion

Successful acquisition and integration of Thorite, the largest independent pneumatic distributor in the UK, adding seven new branch locations.

Direct access or appointment of all the leading Pneumatic and Compressor brands.

Own Brand

Own brand range (FT PRO) sales outperformed like for like product distribution sales by 7.7% and represented

16% of total sales (excluding Thorite) at the end 2024.

Operate for Less

Restructuring to a simplified operating model results in a further 2.2% year on year, like for like headcount reduction whilst mitigating the required incremental investment

associated with increasing the quality of our team and in building new capabilities to support our future growth ambitions.

People, Talent & Capability

Completion of a companywide, Organisational Development plan, leading to a customer focused new way of working, reducing headcount, and increasing efficiency.

Significant changes to our top leader's cohort, some 60% of roles changed, introducing increased skills and capabilities to scale.

Introduced our new H&S cultural focus and values, FLOW (Feel, Live, Operate and Work Safe), once again we can report Zero RIDDORs (Reporting of Injuries, Diseases and Dangerous Occurrences Regulations).

3

Flowtech at a glance

Our purpose

To keep industry moving sustainably.

Our vision

To be the Trusted Advisor in a world of motion.

Our values

We are one team

We work safely and sustainably We are customer obsessed

We are proud of who we are and what we do

As the largest provider of fluid power products, services and solutions in the UK, Ireland and Benelux, we have the expertise needed to serve our customers.

Today, we are a strong market leader in a highly fragmented £30bn European market. We currently have access to

around 10% of this through our three markets in the UK, Ireland and Benelux. We have a clear strategy to accelerate value creation for our stakeholders. We are transforming our company and laid some solid foundations in 2024 to ensure we improve, grow and expand.

4

Flowtech at a glance

Operating in 3 countries and exporting to over 30 more

620

employees

73,000

stocfied products

10,725 active customers

2,300

suppliers

5

Chair's statement

Our Year

2024 was a year of execution against our stated strategic objectives and transformation plan in order to grow our addressable market and underpin future profitable growth. We have focused on protecting the business against a challenging market backdrop and believe the business is now more robust. During the period I believe

we have made solid progress on the path towards transforming the company, including in the delivery of our Strategy and Performance

Improvement Plan (PIP), building the stable and scalable platform needed to support future growth.

I am pleased with the strategic progress being made by a highly energised, determined and galvanised new team under the leadership of Mike England in his first full year at the helm.

2024 was certainly not an easy year in terms of the external markets we serve. The well-documented market headwinds persisted throughout the year with the British Fluid Power

Association (BFPA) consistently citing market decline of above 10% in the UK in Hydraulics and Pneumatics

and macro indicators continuing to weaken particularly in the second half of the year as consumer and industry confidence fell.

Although key operational and strategic milestones have been reached in our PIP, I am disappointed with the financial outcome, our like for like revenue declined by 8.6%

as customers reduced volumes, destocked, and delayed project timelines. Whilst we outperformed the overall market trend, a decline of 8.6% reflects the tough trading conditions. However, our improved gross margin to 38.2% in conjunction with our strengthened sales pipeline and

order book, as a result of a number of

new and exciting orders secured for execution in 2025 is a positive lead indicator of the team's commitment and execution in 2024.

The Board has been particularly encouraged by the Thorite acquisition which, whilst only taking place in August 2024, is demonstrating strong performance and success in terms

of integration and strengthening our pneumatics, automation, vacuum and compressed air offer; a key strategic aim. In the first 18-week period of ownership to the year end

the business generated an underlying operating profit of £0.1m, ahead of our initial expectations. The deal structure was such that the immediate cash outlay of £0.35m was more than repaid by the approximate £0.4m upside relating to the recovery of book debts. In addition, after settlement payments totalling approximately

£0.7m we secured title to inventory which we have fair valued at £2.1m. Overall negative goodwill associated with the transaction was £2.2m as

a result of acquiring assets at less than fair/market value, accounted for as a separately disclosed credit. Thorite performance has exceeded expectations providing confidence in

the stability and growth of this channel into 2025. Including the Thorite contribution, 2024 full year revenues declined by only 4.3%.

With lower-than-expected revenues driven by the persistent market headwinds, we are reporting underlying EBITDA at £5.9m. This excludes the significant profit arising from negative goodwill of £2.2m, in relation to the Thorite acquisition.

Separately disclosed items total

£27.9m; this includes £25.6m in respect of impairment of goodwill, intangible assets and fixed assets. The impairment calculation is based on assumptions for several years into

the future and is extremely sensitive to

assumptions on revenue growth and the discount factor applied to adjust future cash flows to net present value. Recent announcements relating to trade tariffs were non-adjusting post balance sheet events; as such any associated impact (which we do not deem to be material) has not been taken into account in the cash flow forecasts used for impairment testing.

Net debt** increased by £0.4m to

£15.1m at year end (2023: £14.7m) with the increase mitigated by cost reductions and strong working

capital management, most notably an underlying £3m inventory reduction. As a board, we remain very focused on the management of working capital and cash generation. We are comfortable with the current debt profile of the business, which provides ample liquidity and remains within our stated bank covenants.

The Board has reviewed the Group's capital allocation priorities which remain focused principally on supporting the implementation of our strategic plan with appropriate investment into the business to drive

future profitable growth. Furthermore, the Board believes the market

could offer attractive opportunities for further bolt-on acquisitions at distressed prices. Accordingly, the Board has given careful consideration to the payment of a dividend in respect of the year ended 31 December 2024 and has concluded that saving the cash that would be otherwise paid as a dividend is in

the best interests of the Company, reducing leverage and retaining capital allocation flexibility. In 2024 the dividend payment in respect of the year ended 31 December 2023 was approximately £1.4m.

Trading in the first quarter of 2025 has started positively and in line with our expectations. Notwithstanding the continued depressed market

Chairman's statement

conditions and global uncertainty, we now have an enhanced platform in place from which to grow, take market share and meaningfully improve the Company's financial results in the coming year and into the future.

Building our scalable platform for profitable growth

2024 was an important year of transition and execution for Flowtech and whilst we are disappointed

with the decline in revenue, our performance was ahead of the external market trends, implying share gains which is supportive of our move into pneumatics. As such, the Board is pleased with the progress made in delivering the necessary restructuring and underlying performance improvement interventions. There are more details on this on page 19.

Delivering change is not easy and I have been impressed with the determination and resilience of the new leadership team in remaining tightly focused on the customer and delivering strong business performance whilst undertaking

the step changes needed to enable the solid structural and commercial foundations for scalable growth.

This focus has concentrated on three fiey areas:

Simple - In the year, we fully completed the restructuring to a leaner and more scalable operating model, rebranding under One Flowtech and re-aligning the organisation around our newly launched single value proposition, powering up our leadership, commercial and operational capabilities.

Customer First - Implementing important initiatives focused on improving the customer experience,

including enhancements to the current website, the launch of the new catalogue and steps taken to address key customer issues further reducing customer complaints.

Scalable - Focused on delivering efficiency and service improvements across the product distribution network and within the manufacturing and service locations, introducing standardised and consistent work methods resulting in productivity gains and scalability.

The Board is pleased with the steps taken in delivering on our three pillar Strategic Plan; Customer First, The Power of One and A World of Motion, again covered in more detail on page

15. Highlights in the year include:

• Completion of the rebranding of the business to one Flowtech and our own brand to FT Pro.

• The launch of the new Flowtech Value Proposition across all three regions.

• Building the new Digital Platform ready for launch during H1 2025.

• Acquisition and integration of the business and assets of Thorite, expanding our product range and geographical footprint in the UK.

  Our commitment to a safer and more sustainable world

  Our refreshed purpose-led culture and strategy underpins our ESG commitment, and I am again pleased to report that we have continued to build on the good progress already made. Our updated ESG strategy

  is now ready, and we will be implementing this during 2025.

  In terms of progress, over the past year we have:

• Further increased focus and leadership attention on the health, safety and wellbeing of our people, customers, suppliers and stakeholders. We have

  had zero RIDDOR (Reporting of Injuries, Diseases and Dangerous Occurrences Regulations) incidents and, due to improved reporting, have again increased near miss reporting by over 100%. This is reflective of improved reporting, rather than an increase of incidents.

• Continued to focus on our gender diversity goals with 24% of our top 60 leaders now female.

• Our focus throughout 2024 has been on compliance with data recording, ensuring we have an accurate picture of carbon usage across our whole business. Whilst this does result in an increase in emissions reported, it does give us a robust baseline.

Our Investors

Mike and Russ have continued with their mission to reinvigorate our focus to increase our investor facing activity. I have been encouraged during 2024 with a number of interactive investor visits to Flowtech locations, enabling first-hand demonstration of the progress and improvements being made. This

has given us the opportunity to demonstrate the progress of the Performance Improvement Plan and our refreshed and refocused strategy. We are committed to maintaining an active and open dialogue with our investors. We thank our investors for their continued support.

We are also pleased to welcome Singers as a Flowtech's Joint Broker; they came on board in September 2024 and issued an initiation paper to market in January 2025. Panmure Liberum remain as the Company's

Annual Report and Accounts for the year end December 2024

Nominated Adviser and Joint Broker.

Our people and the Board

The team have worked tirelessly to improve the operational performance of the business, driving improved gross margins through commercial pricing and cost control, delivering enhanced service levels and on-time deliveries, further strengthening the senior leadership team and optimising all aspects of the business.

I remain encouraged by the determination and resilience of our new leadership and the energy demonstrated by our people during a period of rapid change and very difficult external markets. We have made significant progress towards the delivery of our strategy and improvement plan and I would thank everyone for their invaluable contribution.

I am also pleased with the progress made in developing our Board with a varied and relevant experience combined with a positive but challenging approach to strive for the high performance expected by our customers. Mike England and

his other senior leadership hires are now well established in the business, and it is encouraging to see the

new depth of relevant industry and leadership knowledge and

experience in action during 2024 as we have set the business up in the right way for scalable growth.

I would like to sincerely thank the Board members for their

continued commitment and positive contributions.

Loofiing ahead

With the rebranding and restructuring now complete, and the new website launch expected in H1 2025, we expect the improvements made across 2024 to bear fruit. We believe we have a strong, stable, and scalable platform for growth into 2025 and beyond.

As we look ahead to 2025, we expect continued and challenging external market conditions to persist but remain cautiously optimistic. We have completed the vast majority of the Performance Improvement Plan and business transformation, and the Leadership Team are now focused

on delivering a sustained period of stability and market share growth. We remain confident in our strategy which serves to unlock the full potential of the Group across the six defined EBITDA growth engines:

1. Customer growth

2. Commercial excellence

3. Product and service expansion

4. Own brand

5. Operating for less, and

6. Building talent and capabilities.

We are well positioned to capitalise on the opportunities available to us after the strategic and operational delivery achieved in 2024. Looking forward, with a broader addressable market and customer base and

the new digital platform being launched, there are a number of key components to driving

improved momentum in 2025, and I am confident we have the right team in place with an unwavering

determination to now build on a solid foundation for sustained growth and value creation in the years to come.

Roger McDowell Chair

The value we bring

We have built a strong brand reputation, finowledge and experience over more than 40 years of servicing customers and are now the largest supplier of fluid power products, systems and solutions across the UK, Ireland and Benelux. Thorite adds 174 years of expertise in the specialist area of pneumatics, vacuum and compressed air, further enhancing our already strong supplier brands, product and service offerings.

Today, everything we do at Flowtech is focused on keeping business moving, whether that's supplying a product or designing and building a complex engineered solution.

Our primary customers are Distributors G Resellers, End Users and Original Equipment

Manufacturers. Around two thirds of our revenue is generated in serving

Maintenance, Repair and Operations (MRO) customer needs and a

third serving Original Equipment Manufacturers' needs.

We operate across a broad range of vertical industry sectors through our Indirect and Direct sales channels. These include:

Aerospace s Defence

Automation s Systems

Pharma Medical Devices

Aggregates Construction Mining

Food s Beverage Packaging FMCG

Process Oil s Gas Petrochem Chemical

Agriculture

Metals s Heavy Engineering

Transport,Shipping, Marine s Air

Automotive

Off Highway

Utility, Waterways, Infrastructure, Waste Energy

2

3

Our Value Proposition is categorised into three areas:

1

We are a high service technical product provider across power, motion and control.

We design, manufacture, repair and overhaul assets.

We deliver major engineering projects and onsite solutions.

Annual Report and Accounts for the year end December 2024

We add value for our customers by helping them with some of their biggest issues, including:

People Capabilities and Sfiills

- with a shortage of engineers in the industry we can provide the technical experience and expertise to help bridge the gap.

Worfiing capital efficiency

- with some £30m of inventory available for same day dispatch, we are trusted by our customers to manage the impacts of inventory and product availability.

Increase uptime and yield

- impacts on costs, productivity and throughput matter, we can help keep operations moving with our high service product distribution.

Product G Technical innovation

- working with the leading brands we can support the latest industry and sector innovations.

Safety and Sustainability

- with increased mandatory requirements and the subsequent reputational risk, we can support our customers to operate safely and sustainably.

In doing so, we support our broad customer base, serving their needs whether they are designing, building, maintaining or improving industrial plant, equipment and operations.

Our unique value proposition provides our customers with the essential technical products they need combined with an unrivalled range of specialist engineered systems G solutions across the world of power, motion and control.

Our own brand - FT Pro -

brings together the previous ten leading brands that we had within the business into one single brand leaders.

FT Pro offers an extensive range of high quality, professionally engineered products, designed to suit the unique requirements of all industries. Our

products are designed by engineers

to be reliable and long-lasting, ensuring your equipment operated smoothly

and reliably.

With FT Pro products, our customers can be confident their applications will run effectively, no matter how demanding the conditions.

Our CEO review

"Controlling the controllables in a difficult marfiet whilst building the solid, stable and scalable platform needed for profitable growth"

Reflections of the year

We entered 2024 anticipating a market recovery, however, trading conditions remained difficult throughout the year. As a newly formed leadership team, we had a steely determination to quickly

implement and deliver the lion's share of the Performance Improvement Plan in 2024 to deliver a solid, stable and scalable platform for profitable growth into 2025 and beyond. I am pleased to report that much of the heavy lifting has now been done.

Controlling the controllables Our optimism of any market recovery was short lived as market headwinds persisted through the first half of the year and continued to deteriorate further in the second half across all of our three geographical regions -UK, Ireland and Benelux. This was reflected in Purchasing Managers Index (PMI) and British Fluid Power Association reports citing more than 10% decline.

We took a mindset of 'controlling the controllables,' taking necessary actions to deliver further gross margin improvements, tight control and a reduction in costs and making

interventions to optimise and reduce working capital throughout the

year. We pivoted to higher growth customer segments ensuring continued market share gains, resulting in a strengthening of our sales pipeline and forward order book. As we look into 2025 we note some exciting projects that are due to complete. Across product distribution, we maintained consistent customer order frequency but saw a notable reduction in order value, a common trend across the industry as volumes reduced. There was a slowdown particularly in construction and Original Equipment Manufacturers across all three of our regions in the UK, Ireland and Benelux, with many projects being stopped or delayed

as destocking and/or cost control

measures took hold.

Holding firm to the plan

Despite the challenging end markets, we've completed the restructuring

to the new, simplified operating model, strengthening the leadership and organisational effectiveness with a concentration on firing up our growth engines. The rebranding to 'One Flowtech' was successfully completed across all three regions with a clear purpose, vision, and

values being introduced to galvanise our people and capabilities together. This in parallel to the development and launch of our new, single value proposition combining the extensive Product Distribution and Engineering capabilities across the Group to bring greater value to our customers, from the supply of a single component

up the value curve to designing, building and installing complex engineering solutions.

We were proud to welcome Thorite to become part of Flowtech in August 2024. Thorite is a strong and trusted UK brand for over 170 years

Annual Report and Accounts for the year end December 2024

of heritage. The acquisition brings a wealth of expertise, knowledge,

product and service capability across Pneumatics, Vacuum and Compressed Air to support the expansion of

our end user customer base and taking us further into the world of motion. Pleasingly, Thorite exceeded expectations in Q4, and we have a highly motivated and re-energised team focussed on delivering growth.

Taking on board customer feedback, we've focussed on making some important improvements to the existing website experience during the year which has led to increased traffic and conversion rates. In parallel, we are well on track with the development of our new digital platform to be launched to the market in H125, which will replace our legacy platforms, enable a step change in speed and customer experience including a range of new data management and marketing tools to improve new and existing customer interactions.

Our people

Above all, it's our people that have made the difference in what has been a challenging year both in managing through a difficult external market and delivering the important step change across the Group to deliver on our strategy and improvement plan.

We thank our people sincerely; they have embraced our vision for a brighter future and gone above and beyond for our customers.

There is growing confidence that the broader growth strategy and actions taken to improve operational efficiency within the business will drive strong returns and improved

shareholder value, further aided when the market recovers.

Reviewing 2024

Like for like revenues have declined by 8.6% in the year as the rate of market related decline across all three regions has outpaced our positive achievements in winning new customers, retaining and strengthening our existing customer base and delivering improved

gross margins.

This revenue decline has been

multi-faceted with the larger impact being reduced volumes from Original Equipment Manufacturers, as they have continued to de-stock and larger engineering projects being suspended or delayed. This was more prevalent in the second half of the year with Ireland in particular being impacted

by the Aggregates G Construction sector (in particular the OEM Crushing G Screening market) which saw more than 20% reduction in volume.

Underlying EBITDA for the year ending 31 December 2024 was

£5.9m. We have also achieved a profit recognition of negative goodwill of

£2.2m, which is separately disclosed. We incurred an impairment charge of

£25.6m, the detail of which is covered in the CFO statement on page 32.

As a team, we've remained very focused on the management of working capital and cash generation and are comfortable with the current debt profile of the business, albeit this remains an area of focus.

Leadership focus has remained firm on executing strongly across all areas of our Performance Improvement Plan, designed to fix many of the core basics required to improve customer service and performance. The business is now a more customer-centric, lean and scalable platform for growth.

This is broadly structured under three headings where progress updates in the year have been summarised.

A new, simplified operating model

To unlock the full potential of

our people and capabilities across the Group.

We have successfully rebranded under ONE Flowtech, embedding a new single integrated organisational model, across the three regions, aligned to our new value proposition and corresponding go-to-market approach. In doing so, this has strengthened commercial, operational and functional leadership and human capital capabilities, creating new departments and roles including changing 60% of the top 60 leaders in role during the year.

Customer-centric

Winning back customer confidence, powering up our growth capabilities to increase the quality and frequency of customer interactions underpinned by improved customer service.

Taking on board customer feedback throughout 2023, we were pleased to launch the new Flowtech Catalogue, something that many of our customers value, in April 2024, with 53,000 catalogues deployed across our trusted Partners. The new catalogue has been received

extremely positively, restoring Flowtech as the leader in the market, with this vital industry publication.

Over the year, we were pleased with the progress made by our sales teams, taking our new value proposition to market and building the sales pipeline, increasing the value of opportunities by over 50% and securing a number of new contracts for 2025 delivery. As a result, the Group orderbook at the

end of 2024 was at the highest level to date.

With improvements made to our on-time-in-full service, existing website and continued focus on the speed of response to customer enquiries, we are pleased to report that customer satisfaction measures have continued to improve. This is a testament to

the focus of the teams which has continued to win back customer confidence and renewed enquiries.

Getting bacfi to doing the brilliant basics

Delivering operational and service excellence

We have implemented material changes to improve the operational service and pricing mechanics across the business, recovering a lack of commercial and operational attention and regaining customer confidence which had been significantly eroded over the past years. This being a key factor in the gross margin, service and efficiency gains made.

Gross margin has improved by 142bps in the year through our commercial focus and discipline. The careful management of operating overheads throughout the year and restructuring work now completed has delivered a net

£1.5m annualised cost reduction into 2025. In addition, our newly formed Group Procurement Team have delivered over £1m of indirect and direct procurement savings through enhanced capabilities and rationalisation across the group.

Continued focus on working capital management and service excellence enabled a reduction in inventory of

£4m whilst sustaining >97% availability on our fastest moving lines.

Executing well on our strategy

We have defined a strategic framework consisting of three pillars and six defined EBITDA growth engines. 2024 has been an important year, with strong progress in all three areas.

1. Customer First

   Diverse customer base and omni-channel approach.

   We are well on plan in building the new digital platform and associated technology improvements; ready for testing in Q1 2025 and launch in Q2 2025. This includes a new, improved customer website interface, enhancement of core technology infrastructure with the successful implementation of a new technology integration layer, new customer data platform, new content management system underpinned by some

   big steps to improve our product

   information management capability and data quality.

2. The Power of One Differentiated value proposition delivered through one team.

   We have completed the rebranding of the company to 'One Flowtech' across all three regions embedding our purpose, vision and values. We have built and enhanced core Group capabilities in Procurement, Product Management, Communications G Marketing, Digital, Data, HR and Finance meaning that we bring

   Our CEO review

   
   
   

   standards and consistency in our processes, ways of working and are delivering greater efficiency gains.

   One primary focus in 2024 has been to reset our relationships with our key

   strategic supplier partners. Now we are operating as one Flowtech with clarity of our value proposition and growth plans, we've seen far greater levels of understanding and engagement from our suppliers and have put in place refreshed growth plans.

   We also brought together ten of our leading own brands into one single brand, FT Pro. Offering an extensive range of high quality professionally engineered products, we launched FT Pro to market and began brand building and awareness to initiate greater levels of growth. This was just the start of a longer-term plan to grow and expand the FT Pro range. We were encouraged to see growth in FT Pro at 7.7% higher than the overall business, bucking the trend of the wider market. FT Pro now represents 16% of total revenues.

3. A World of Motion

Expanding our products, services and geographical reach

The acquisition of the business and assets of Thorite in September brings market share gains and expands our brand, product and service offering in pneumatics, vacuum and compressed air. This combined with 1,000 collective years of relevant industry experience across colleagues in seven branches, expanding our technical capability

Annual Report and Accounts for the year end December 2024

and geographical footprint in the UK. The integration has been successful, and we are pleased to report performance ahead of plan with

£4.5m of revenue over 4 months, acquired from administration and turned around from a £1m annual loss to making a positive profit contribution in the first 18 weeks of ownership and with full recovery of the debt and cash outlay.

Our commitment to ESG

- helping to build a safer and more sustainable world

We have continued to increase our focus on ESG within three key areas. In parallel, we have completed a detailed analysis of

our ESG activities, and I'm pleased with the progress we made towards renewing our strategy, which will launch in 2025.

Our environment and becoming more sustainable

Our focus throughout 2024 has been on compliance with data recording, ensuring we have an accurate picture of carbon usage across our whole business. Prior to 2024, the business operated as separate business units, so this work has been essential to standardise our approach.

In 2025 we will be launching our updated ESG strategy. Within that we will detail our targets to manage

and reduce our environmental impact,

along with the Key Performance Indicators we will use to assess progress against these targets.

Our culture, health, safety and wellbeing of our people

Focus on further deployment of our Health G Safety improvement plans has resulted in increased reporting of near misses, demonstrating

a step change in awareness and management attention and

importantly, zero RIDDORs. At the end of 2024, we launch our new FLOW Safe programme. A longterm awareness and improvement programme built around FLOW -Feel Safe, Live Safe, Operate Safe and Work Safe. This is gaining good momentum and keeping safety and wellbeing at the forefront of our people's minds.

We were proud during 2024 to initiate our partnership with CALM (Campaign Against Living Miserably) to raise funding towards suicide prevention and mental health causes.

Our governance and policies as we've now become One Flowtech

Ensuring we have the right foundations in place to support our move to One Flowtech is vital. We have introduced a company-wide tiering system to ensure consistency and transparency across all roles across the organisation. We are also undertaking a full review of all our policies to ensure they support our updated ways of working.

In summary

We are satisfied with the progress we have made implementing our strategic plan, whilst recognising that this has been a difficult year due to challenging end markets. With further operational improvements delivering enhancements to

gross margins, working capital optimisation, service levels, and operational efficiencies, we are confident that we are controlling the controllables. The group rebranding and restructuring are complete, and the successful integration of Thorite is well ahead of our expectations.

With much of the business transformation concluded we have a firm, stable and scalable platform from which to deliver profitable growth into 2025 and beyond.

We recognise the likelihood of continuing challenging markets, and we are not relying on a market recovery to drive our progress. Our mantra is to make our own success, and we head into 2025 with cautious optimism. The pipeline and order book are materially stronger entering 2025 than at any point in the past. We equally have a close eye on gross margin optimisation and generating accretive EBITDA.

Actions to deliver £1.5m annual net

cost savings during 2024 and return Thorite to positive profitability are key enablers to this, with any market recovery seen as upside in our view. We are well positioned, despite the persistent market headwinds and remain steadfast, determined and confident in our strategy.

Mifie England

CEO

Our strategic plan

2023-2026

Our Strategic plan covers the period 2023 - 2026 to deliver mid-term market growth and value creation. Despite the persistent market headwinds, we remain determined to execute strongly on our plan.

Our approach is simple:

Customer

First

The Power

of One

A World

of Motion

We have a diverse customer base and omni-channel approach in a highly fragmented market.

Customer First

Our customers' needs are changing with increased digitisation across products and services. The need to operate machines and operations more sustainably drives increased adoption of electrification and also opens up new opportunities such as one of industry's mega trends, hydrogen. There is increased market consolidation happening and supply chains becoming more regionalised meaning strategic supplier partnerships are a critical enabler to drive customer satisfaction. With a shortage of skilled engineers in industry, this increases the demand on suppliers to move up the value chain to deliver complete systems and solutions not only the supply of products.

We launched our new catalogue in April 2024. Based on customer feedback, we returned to

a trusted format, with one catalogue covering our full offer. This received incredibly positive feedback from our customers. We've made improvements to our existing web platform which has resulted in increased traffic albeit the customers continue to find the experience challenging. Therefore, and importantly, we are pleased to report that we are on track to launch our new and improved web platform in H1 2025, with much of the foundation work completed in H2 2024. We've been working hard to improve our service, and we see key operating metrics trending in the right direction with customer and fulfilment centre complaints down, product availability up, sales force productivity up

and the order book building with a visible and

improved sales pipeline.

Annual Report and Accounts for the year end December 2024

We will deliver a differentiated value proposition, delivered under one brand, with a lean, efficient operating model.

The Power of One

Unlocking this potential is made possible by simplifying the operating model under one brand, Flowtech. In doing so, shifting from

a fragmented house of brands to a leveraged and integrated branded house. This includes rebranding over ten 'own branded' product ranges into one, FT Pro, then to increase brand building activity around a simple and compelling customer value proposition.

In 2024 we completed the rebranding work and now have a consistent approach, as one Flowtech, across our organisation, including all

UK, Ireland and Benelux locations. Transitioning from 10 cash generating units to 3. This has also given us the opportunity to promote our full value proposition, giving us the ability to upsell and cross sell to our existing customers, as well as introducing new customers to our wide-ranging capabilities. As part of this work, we underwent

a wholesale restructure of the business to ensure we were set up in the right way to deliver for our customers. We completed a critical review of

all teams and roles to ensure we are operating effectively and efficiently and setting ourselves up to scale and grow in the future.

Expanding our products, services and geographical reach to increase market penetration.

A World of Motion

The fluid power market is changing and we need to evolve to meet our customers' needs and accelerate our commercial advantage. Expanding our product and service offerings across

the wider power, motion and control sectors increases our addressable market opportunity in Europe from £10bn to more than £30bn, helping us to increase customer penetration and future proofing our business. Flowtech is well positioned to create competitive advantage by unlocking the full Group potential with a broad technical product offering and engineering service capability across our indirect distributor network and our direct channels. This includes a mature own brand product portfolio with the opportunity to continue to expand and grow its share. The mid-term opportunity is to expand

our product and service offering into the wider 'World of Motion' to better support our collective customers and their evolving needs.

Whilst this is a longer-term element of our strategy, in 2024 we successfully acquired Thorite, a specialist in pneumatics and air systems controls. The transition and integration of the Thorite business has gone incredibly well. We have right sized the business and worked with the team to bring together the Thorite operation with the core Flowtech offering. This was a great opportunity for us

to further strengthen our pneumatics offer, as well as adding seven UK branch locations to our footprint. Overall, the acquisition has been very successful and is now operating profitably.

6 Our six growth engines

Our strategy is underpinned by our six growth engines. Our strategic imperatives for 2024 were Commercial Excellence and Operate for Less.

Reminder of our plan Margin engines

Developing

Annual Report and Accounts for the year end December 2024

We have made significant progress in our focus areas, this includes:

Commercial excellence Optimising inventory and availability: We have reduced stock value by £4m,

whilst maintaining 97% stock availability.

We have developed a robust sales pipeline across our eight sales channels to ensure we have visibility of upcoming opportunities and a forum to discuss and evaluate these. The value of the sales pipeline has increased

by over 100% in the past 12 months. This has also given us the ability to work more collaboratively across the business where opportunities touch more than one team.

Operate for less

We have continued to optimise efficiency in our fulfilment centre, with headcount down 23% from January to December 2024 and despatch lines by headcount up 7.5%

Marfiet

Self help

Capex help

Margin

Our strategic roadmap

Initiating Developing Advancing Embedded 2024 strategic

imperatives

In 2024 we made good progress against our strategic roadmap. We are well on track in building the new Digital Platform which will provide enhanced website and marketing capability across all three regions. In addition, we have implemented a Data-Integration capability to create greater levels of cross-Group visibility with a single view of our customers and inventory as examples. The Integration layer provides a lower cost connectivity and enablement across our Enterprise-wide Systems. Market conditions did mean we had to rephase some of our planned activity.

Performance

improvement plan

Delivering what we set out to do

In the summer of 2023, we set out our Performance Improvement Plan to improve a number of areas of our business that required some immediate attention and lay solid foundations to enable us to grow and scale as we move forward. Our objective was to deliver a more customer-centric, lean and scalable platform for growth.

2

Our Performance Improvement Plan is underpinned by 3 fiey principles:

1

Simple Introducing a new, simple operating model with a new

team releasing the full potential of our people and our capabilities.

Customer Centric Decision making and activities centred around the customer with a refreshed growth focus.

Scalable

3

Re-focus on doing the basics brilliantly whilst improving our

operational technology infrastructure to power future growth.

Throughout 2024, we built on the progress we made in the previous six months and have been pleased with the results:

Tightly managed overheads with 2.2% like for like headcount reduction in FY24. This has served to partly offset investment

we have made to improve the quality of capabilities and the infrastructure to support our growth ambitions.

Focus on commercial excellence delivered 142bps of gross margin improvement.

Continued focus on working capital management delivering £6.7m improvement.

Underlying £3m reduction in inventory with product availability remaining stable at 97%.

Restructured sales and marketing, new catalogue delivered and new web

platform on track for delivery in H1 2025.

Improved customer experience, complaints down a further 27%.

20

Fulfilment centre efficiency gains, 8% increase in operator capacity and 23% headcount reduction

We have now achieved what we set out to with our Performance Improvement Plan and focus in 2025 will be on progressing our strategic plan.

Environment, Social

and Governance (ESG)

Environmental

Carbon measurement

Our focus throughout 2024 has been on expanding our data collection, and aligning compliance with data recording, ensuring we have an accurate picture of carbon usage across our whole business. Prior to 2024, the business operated as separate business units, so

this work has been essential to join together and standardise our approach, to include far more data collection, providing one version of

the truth. We have also extensively increased what we're measuring, to include all fuels including stationary, mobile, and third party, all utilities, waste, refrigerants, freight, travel, hotels, and material usage. All reported data is measured, or captured via transfer receipts unlike previous years, assuring increased reliability and accuracy.

We have engaged Carbon Responsible to support with our data collection, target setting and

compliance. Each of our sites, has been trained and educated on our new approach and now has access to a carbon portal, to enter live information at a local level so as not to rely on a central perspective.

Our new partnership and reinvigorated approach to recording Greenhouse Gases again provides

a consistent and solid baseline that we can use to set out clear targets as part of our ESG strategy.

Annual Report and Accounts for the year end December 2024

Carbon reporting

We have seen an increase in our emissions compared to FY23. With the exception of the addition of the seven Thorite sites, we believe this can largely be attributed to an increase in disclosure in FY24 compared to FY23, as we have improved and expanded our emissions data capture.

2024 reported figures will now be used as a Baseline, providing an accurate reflection of current usage and emissions.

Overall, our Greenhouse Gas (GHG) emissions increased in FY2024

by 41.53% compared to FY2023 (+1,279.14 tCOSe). It should be noted that 81.74 tCO2e (6.39%) of this increase is attributable to the addition of seven Thorite locations to the Group.

In total, Scope 1 emissions increased by 36.01% (+162.94

tCO2e). 19.02 tCO2e (11.67% of

this increase) is attributable to refrigerants, which were reported for the first time in FY2024, and which may fluctuate year-on-year, and 27.20 tCO2e (16.69%) is contributed by Thorite. Within

Scope 1, there was a 10.86% (+26.00 tCO2e) increase in stationary

fuels, of which, 7.72 tCO2e (30%) is contributed by Thorite, and a 55.36% (+117.92 tCO2e) increase in

mobile fuels, of which, 19.48 tCO2e (16.52%) is contributed by Thorite. Remaining increases are attributable to improved reporting within Scope 1, in particular for mobile fuels.

Scope 2 emissions increased by 29.25% (+77.28 tCO2e). Addition of Thorite locations accounts

for 13.13% of this increase (10.15

tCO2e). Owned electric vehicle emissions increased by 15.76 tCO2e, accounting for 20.39% of the total Scope 2 increase, and indicating the increase in Electric Vehicles in Flowtech's fleet.

The remaining increases can be attributed to improved reporting of electricity data across its locations and increases in consumption.

Scope 3 emissions increased by 43.97% (+1,038.92 tCO2e). Thorite

locations contributed only 44.40 tCO2e (4.27%) to this total. Freight contributed the largest portion of the increase (28.99% of the Scope 3 increase, +301.16 tCO2e compared to FY2023), followed by purchased goods and services (25.96%,

+269.67 tCO2e), of which, 269.54 tCO2e (99.95%) is from material use which was reported for the first time in FY2024. 57.18% of the material use emissions total (154.20 tCO2e) is from metal use reported by PFS. A further 41.08% (110.77 tCO2e)

is from combined paper, board and plastics reported by Pimbo Road. The third largest contributor to the Scope 3 increase is waste generated in operations (18.47% of the increase, +191.85 tCO2e

compared to FY2023). The largest contributors to waste emissions are wood reported by Pimbo Road (98.32 tCO2e, 38.06% of total waste emissions), and commercial and industrial waste reported by Gloucester (83.57 tCO2e, 32.35%

of total waste emissions). Employee commuting increased by 112.43 tCO2e in FY2024, accounting for 10.82% of the Scope 3 increase, largely due to an increase in reported average FTE. Business travel increased by 103.06 tCO2e, accounting for 9.92% of the Scope 3 increase. Lastly, Fuel and energy related activities not included in Scope 1 and 2 increased by 60.76 tCO2e, and is directly related to the increase in reported fuel and energy in Scopes 1 and 2.

Excluding the addition of Thorite locations, the emissions increases may be attributed to an increase in disclosure in FY2024 relative

to FY2023, as we have improved and expanded its emissions data capture. It is expected that our measured emissions will continue to increase as it continues to expand and improve its reporting.

Intensity

Two intensity metrics have been calculated for our emissions, one based on full-time equivalent employees and one on revenue. Intensity metrics are a useful way to assess changes in emissions within a growing company, as whilst absolute emissions increase, the impact per chosen unit can reduce. Reporting intensity metrics are also a requirement of UK SECR reporting. In comparison to FY2023, the FY2024 emissions per FTE have increased by 25.66% (from 6.31 to 7.93 tCO2e/FTE. The FY2024 emissions per £100,000 of revenue have increased by 47.88% (from 2.75 to 4.07 tCO2e/£100,000 revenue); measured emissions have risen whilst revenue has decreased.

Waste Management

At the beginning of 2024, we only collated data for non-hazardous and general waste recycling. By the end of 2024, we now collect and report on hazardous and WEEE (waste electrical and electronic equipment) as well, providing a complete picture of our waste management. This

will be used as a baseline as we set targets to further reduce waste where we can, this will of course include working with our supply chain to reduce packaging.

Fleet Management

In 2024 we refreshed our approach to fleet management, working with a new fleet provider and build on our green approach to cars and commercial vehicles.

In 2024 our overall fleet, including taxable cars and light commercial vehicles, consisted of 155 vehicles. 54% of this fleet are either hybrid or fully electric (2023: 53%). Of our taxable fleet 81% of vehicles are hybrid or fully electric (2023: 85%).

The reduction here is due to nine of the 11 cars we inherited from Thorite having internal combustion engines.

As these leases end, these cars will be replaced with hybrid or fully electric cars, in line with our policy. Of the 17 new taxable cars added to the fleet in 2024 100% of these were hybrid or fully electric (2023: 100%). Our fleet management provider advised that having an environmentally conscious fleet with over 50% being hybrid or electric is leading the way towards full carbon reduction.

Energy Usage

Organisations that qualify for ESOS must carry out ESOS assessments every 4 years. These assessments are audits of the energy used

by their buildings, industrial processes and transport. The latest ESOS report captured energy consumption for the calendar year 2022. The basis for the report is

multi-site Display Energy Certificate Advisory Report surveys produced by an external qualified assessor.

The analysis for 2022 showed a net reduction in energy consumption of 652,327 kWh, compared with the previous ESOS period.

Total energy consumption (2022): 3,605,620 kWh (down from 4,257,947 kWh in the previous ESOS period).

• Breafidown:

• Buildings: 2,384,480 kWh (1,311,047 kWh electricity, 1,078,178 kWh gas, adjusted for renewables).

• Transport: 1,221,140 kWh (company vehicles, private mileage, and equipment fuel), accounting for 35% of total consumption.

Delivery efficiency

We continue to enforce a delivery model focused on reporting and reducing the overall emissions and carbon footprint. Fedex remain responsible for 80% of the outbound logistics with a focus on customer satisfaction, on time in full deliveries and creating the most efficient routing system.

Environment, social and Governance (ESG)

Managing our climate-related risfis and opportunities

We have a clear process for managing our risk profile, which includes climate-related risks and this is outlined on page 35. As part of this process we identify, assess and manage climate related risks and opportunities.

Our principle climate-related risk is a force majeure linked to climate change that could cause serious supply chain or economic impacts. This is review annually and we ensure we have the appropriate mitigating actions in place (these are detailed on page 39).

Our plans and ambitions

In 2025 we will be launching our updated ESG strategy. Within that we will detail our targets to manage

and reduce our environmental impact, along with the Key Performance Indicators we will use to assess progress against these targets.

Social

Our People

Setting ourselves up in the right way to support our people and deliver our strategy.

Employee statistics

*Annual average

**(1-leavers during 2023/average number of employees)

***Average number of years served by current employees

****Thorite colleagues account for 28 of this figure; at the year-end Thorite had 72 employees but this figure reflects average headcount across the year.

Annual Report and Accounts for the year end December 2024

Health and safety

In 2024, we are pleased to report we had zero RIDDOR (Reporting of Injuries, Diseases and Dangerous Occurrences Regulations) related incidents. We introduced an updated Near Miss process and we have seen a significant increase in

Near Miss reporting. Preventative action in the form of the near miss reporting process enables all

employees to actively identify items or circumstances that would, if left unprocessed, have the potential to cause harm, therefore removing the

looking at ways to support physical wellbeing. In 2024 we introduce air quality and noise assessments our at engineering centres to monitor and improve the environment that our people are working in.

• Spirometry and lung function examinations are performed by an exterior medical professional to monitor the affect of welding and painting activities, and

  to validate the increased DIP slide testing process installed

  safeguarding for employees that

  risk whilst continually empowering all

  employees to take an active role in both their and their colleagues' safety.

  We are subject to regular independent Health and Safety audits. Due to

  the work we have done in 2024 we have been able to reduce major risks identified from audit by 86%.

  Expert examination of the company's assets, locations, and working practices promotes adherence to current regulations and recognized best practice standards through identification and education.

  Regularly identifying opportunities to improve and imposing strict

  remedial action guidance directs each location and function to maintain standards expected by law whilst ensuring unbiased external validity.

  This process works in conjunction with the Group Health and Safety team's support to constantly drive a cultural shift towards best practice in maintaining the highest standards of Health and safety.

  Throughout the year we introduced Health and Safety 'cultural audits' to understand and evaluate the attitude of our people to Health and Safety. This is a critical part of our Health and Safety plan, as it underpins how our colleagues turn up for work each

  day. Exterior validation was gained via the undertaking of interviews guided by the HSE maturity model aimed at directing focus to the areas of the business deemed as opportunities to improve whilst capitalising on those areas reported as 'what we do well in.'

  In line with this we introduce a simple ethos to Health and Safety, that's easy for our colleagues to remember, and links with our broader vision

  and values. We called it FLOW Safe,

  which stands for Feel Safe, Live Safe, Operate Safe and Work Safe. Building a culture grounded in sound Health and Safety practices in everything we do is critical for us and we will continue to build on this in 2025.

• Positive outcome of 2x HSE inspections.

• Improved On-Site Services risk management and oversight.

• Tighter document control of safety systems on clients locations.

• Improved MPOS/Client collaboration on safety.

• 50% Increase of KPI trackable client visits by Group HsS.

• Stricter rules and regulations behind misuse of alcohol and drugs - behaviour not to be tolerated.

  Wellbeing

  Supporting our colleagues is something that we take seriously and over the last few years we have built a network of Mental Health First Aiders across our business. We currently have 25 Mental Health First

  Aiders, up from 19 in 2023, and these individuals are on hand to provide a listening ear and signpost support that is available, when someone is going through a tough time. Each first aider has completed training with Mental Health First Aid England, who teach practical skills to spot potential signs triggers of mental health concerns in colleagues. We also had two people who completed suicide prevention training.

  Along with supporting our colleagues mental wellbeing, we are always

  are exposed to metal working fluids within engineering

• Hearing function examinations are undertaken on those deemed at potential risk via noise assessments performed within the engineering

One Flowtech

Earlier in this report, we talked about our transition to One Flowtech. This had an impact on our people, as

we had to structure our business to support our strategic goals.

Following an extensive Organisational development programme, to introduce our new ways of working, we restructured our business so that we had a functional matrix model, supporting our country and regional structures, across the UK, Ireland and Benelux. Doing this enabled

us to identify areas of duplication and subsequently streamlining functional responsibilities and ensuring everyone in the business was in the right role. Alongside this we introduced a new job architecture that introduced role tiering, which provides a clear and transparent

approach to role profiling. We created a new company wide bonus scheme, a first for Flowtech, and introduced an annual pay review. In April 2024 we ensured that we paid above the Real Living wage as a minimum rate of pay. We also launched a new, management self-service HR system to ensure we have all of our employee data in one place. This system is now providing key people data analytics, enabling us to manage our people

plans, our recruitment and our training

with key information, not previously available to us.

Developing our people

The knowledge and expertise that our people have differentiates us from our competition, so developing our people is critical. With that in mind, in 2024, we have significantly increased our training hours - 6,852 in 2024 compared to 863 in 2023. This included technical training, sales skills and sales leadership training and a senior leadership development programme.

NEBOSH and level 6 HGS Leadership training has also been undertaken by members of the Group Health

G Safety team, along with a large volume of First Aid, Fire Safety, skill specific awareness and competency training across the company.

Focus on Technical Training

In 2024, we prioritised technical training across the organisation, with revamped course content delivered in three key areas:

1. Catalogue Training Delegates gained in-depth knowledge of our product catalogue, including how to

   navigate its sections, understand each area, and effectively use the indexes.

2. Product Training Comprehensive training was provided on individual products, covering both supplier offerings and our own-brand products.

3. Technical Training Sessions covered essential

topics such as basic hydraulics, pneumatics, air preparation, and pneumatic symbols.

Our internal trainer achieved accreditation to deliver the BFPA Level 1 Pneumatics course, positioning us as an accredited provider of this recognised training. Beyond upskilling our employees, we extended these training sessions to some of our distributors.

A distributor from Lockwells noted, "The training was very informative and I believe it will help us better understand the enquiries for pneumatics and hydraulics that we receive daily."

We also expanded training in other areas, particularly in IT, with

targeted Excel and Power BI training to enhance digital capabilities across the business. The blended delivery model, combining classroom sessions with online learning, has enabled teams from various locations to participate and develop their skills effectively.

These initiatives reflect our commitment to continuous improvement and equipping both colleagues and partners with the technical expertise needed to excel in a dynamic market.

Powering up our Sales Team We partnered with Discovery

ADR to conduct a comprehensive

assessment of our Sales team's skills and capabilities through a series of talent centres. These centres engaged teams in various scenarios, including individual and group activities, to evaluate behaviours and responses to different challenges.

Following these assessments, we introduced three targeted training programmes: Critical Sales Skills, Building Commercial Acumen, and the Sales Leadership Development Programme. Initially, these initiatives

were implemented with our UK teams. Due to their success, the talent centres were extended to our Irish teams, and a cohort of delegates from Ireland is now

participating in the Sales Leadership Development Programme.

The primary goal of these programmes is to equip our Sales teams with the skills and behaviours required to operate as a high-performing unit. To complement this, additional training was also provided to our Customer Service teams, focusing on enhancing their skills and behaviours to deliver exceptional service.

These initiatives reflect our commitment to continuous professional development, ensuring our teams remain competitive and capable of driving sustained growth and success.

Building a high-performing leadership team

We partnered with Defy Expectations to train and coach our leadership team with the goal of creating a high-performing, customer-centric organisation.

Recognising that some leaders were new to the company or new to the role, we needed to build a unified leadership team equipped to navigate the challenges and opportunities ahead.

We also introduced go to support for our leaders that was easy to access and covered areas that new leaders would particularly need, this was called "Leadership Mastered"

Annual Report and Accounts for the year end December 2024

Apprenticeships

We have maintained our apprenticeship programme throughout 2024, with seven new apprenticeships started throughout the year in a variety of disciplines, including engineering, customer services and finance.

Apprenticeship Levy

During 2024 we have paid £89,314 into the Apprenticeship Levy

account and have spent £93,395 this has resulted in us not incurring any expired levy. At the end of 2024 we had a levy pot of £113,703.

In May Flowtech was accepted as a member of the 5% Club showing our commitment to early careers. By joining the 5% Club, we aspire to achieve 5% of our workforce in earn and learn positions, including apprenticeships, sponsored

students, graduates, placements and formalised trainee schemes.

The 5% Club is a dynamic movement of employers committed to earn

G learn as part of building and developing the workforce they need as part of a socially mobile,

prosperous and cohesive nation. The Club exists to help its members and all employers increase further the number, quality and range of earn G learn opportunities across the UK.

Our communities

In 2024, we partnered with CALM (Campaign

Against Living Miserably), a charity that offers support, advice and information to people who are struggling with mental health issues or suicidal thoughts. We raised

just under £10,000 at our Summer Extravaganza event last June and will continue to focus on this important area in 2025. We have a network

of charity champions, a group of volunteers from each site who have signed up to support our fundraising efforts.

As well as our support for CALM, colleagues in the business have also taken part in Macmillan Coffee Morning, Save the Children's Christmas Jumper Day, and our walking group took part in some sponsored walks.

Governance

Compliance G Risfi Management

To ensure compliance with our updated recruitment policy we introduced a new recruitment gateway and approvals process, giving us consistency and visibility of our recruitment activity.

We launched a new Whistleblowing policy and process. Internally we refer to this as 'Speak Up' and it provides our colleagues with mechanism

to report potential wrongdoing, malpractice or danger within the business. We want a transparent culture, where our colleagues feel supported and safe at work, and this is one element of that.

In 2024 we began a wholesale review of our policies to ensure they are

still fit for purpose. So far we have

relaunched our expenses policy, our disciplinary and grievance policy and our dress code and uniform policy. We will continue this work in 2025.

We launched our Health and Safety policy for our Irish and Benelux businesses, using our UK policy as a starting point and taking into account local legislation.

2024 saw central Health G Safety facilitate the accreditation to both Safe Contractor and Silver Constructionline (Durham), streamlining our ability to perform works to a wider remit.

We published our new modern slavery statement, demonstrating our commitment to preventing modern slavery and human trafficking within

our operations and supply chains.

In 2025 we will launch our Code of Conduct to further

enhance our One Flowtech culture, approach, and ways of working. Our aim it to outline our approach to key aspects of work-life, highlighting areas where high levels of vigilance are required, such as cyber security, and guiding our colleagues to understand how we all want to work together and uphold our values and behaviours.

Our full Risk Register is available on page 39 of this report.

26

Section 2 Governance