Full year results for year ended 31 December ...

About this update from Bodycote Plc

[{"type":"text","content":"\n\n \n \n\n\n\n\n     Bodycote plc - Full Year Results for the year ended 31 December 2024 Resilient performance; new strategy in place   \t \t\t \t\t\t \t\t\t Group summary \t\t\t \t\t\t \t\t\t Adjusted \t\t\t \t\t\t \t\t\t Statutory \t\t\t \t\t \t\t \t\t\t \t\t\t Full year \t\t\t \t\t\t \t\t\t Full Year \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Full year \t\t\t \t\t\t \t\t\t Full Year \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t Growth \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t Growth \t\t\t \t\t \t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t £757.1m \t\t\t \t\t\t \t\t\t £802.5m \t\t\t \t\t\t \t\t\t -5.7% \t\t\t \t\t\t \t\t\t £757.1m \t\t\t \t\t\t \t\t\t £802.5m \t\t\t \t\t\t \t\t\t -5.7% \t\t\t \t\t \t\t \t\t\t \t\t\t Operating profit 1 \t\t\t \t\t\t \t\t\t £129.0m \t\t\t \t\t\t \t\t\t £127.6m \t\t\t \t\t\t \t\t\t +1.1% \t\t\t \t\t\t \t\t\t £37.9m \t\t\t \t\t\t \t\t\t £119.2m \t\t\t \t\t\t \t\t\t -68.2% \t\t\t \t\t \t\t \t\t\t \t\t\t Operating margin 1 \t\t\t \t\t\t \t\t\t 17.0% \t\t\t \t\t\t \t\t\t 15.9% \t\t\t \t\t\t \t\t\t +110 bps \t\t\t \t\t\t \t\t\t 5.0% \t\t\t \t\t\t \t\t\t 14.9% \t\t\t \t\t\t \t\t\t -990 bps \t\t\t \t\t \t\t \t\t\t \t\t\t Operating cash flow 1,4 \t\t\t \t\t\t \t\t\t £115.5m \t\t\t \t\t\t \t\t\t £112.2m \t\t\t \t\t\t \t\t\t +2.9% \t\t\t \t\t\t \t\t\t £152.6m \t\t\t \t\t\t \t\t\t £191.6m \t\t\t \t\t\t \t\t\t -20.4% \t\t\t \t\t \t\t \t\t\t \t\t\t Basic earnings per share 1,2 \t\t\t \t\t\t \t\t\t 48.6p \t\t\t \t\t\t \t\t\t 48.4p \t\t\t \t\t\t \t\t\t +0.4% \t\t\t \t\t\t \t\t\t 10.8p \t\t\t \t\t\t \t\t\t 45.1p \t\t\t \t\t\t \t\t\t -76.1% \t\t\t \t\t \t\t \t\t\t \t\t\t Full year ordinary dividend per share \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 23.0p \t\t\t \t\t\t \t\t\t 22.7p \t\t\t \t\t\t \t\t\t +1.3% \t\t\t \t\t \t   \t \t\t \t\t\t \t\t\t Core summary 1 \t\t\t \t\t\t \t\t\t Full year \t\t\t \t\t\t \t\t\t Full Year \t\t\t \t\t\t \t\t\t Organic \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Excludes sites to be exited under Optimise programme \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t Growth 3 \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t £712.5m \t\t\t \t\t\t \t\t\t £747.3m \t\t\t \t\t\t \t\t\t -2.9% \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Revenue excluding surcharges \t\t\t \t\t\t \t\t\t £679.6m \t\t\t \t\t\t \t\t\t £685.5m \t\t\t \t\t\t \t\t\t +1.0% \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Adjusted operating profit \t\t\t \t\t\t \t\t\t £127.6m \t\t\t \t\t\t \t\t\t £124.8m \t\t\t \t\t\t \t\t\t +2.9% \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Adjusted operating margin \t\t\t \t\t\t \t\t\t 17.9% \t\t\t \t\t\t \t\t\t 16.7% \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t   Highlights \t Stable organic revenue performance, excluding surcharges, in a challenging market environment \t Significant improvement in adjusted operating margin, progressing towards >20% target by 2028 \t Performance led by Specialist Technologies, with further growth and margins +300bps to 29.0% \t Statutory operating profit of £37.9m, reflects previously indicated charges: £31.9m related to the Optimisation programme, £28.4m ERP-related impairment, and a goodwill impairment of £18.0m \t Adjusted operating cash flow modestly higher year-on-year at £115.5m (90% conversion) \t Early progress delivered on strategic plan to create an efficient, high performing Bodycote \t \t\t Optimise: first plant closures commenced, £12m-14m profit benefit at full run-rate (end 2026) \t\t Perform: HEAT programme to improve operational performance rolled-out to pilot sites \t\t Grow: framework in place and attractive investment options identified in high margin areas \t \t \t Close to £100m returned to shareholders in 2024 (~£40m dividend and ~£60m buyback). Further £30m buyback underway; leverage remains low at ~0.3x net debt / adj. EBITDA (pre-leases) 2025 Outlook All guidance comments are provided on an organic basis 3 End markets remain mixed, with challenging conditions in Automotive and Industrial. Structural demand in Aerospace & Defence remains strong, although there continues to be a temporary impact from industry-wide supply chain disruption. Reflecting this backdrop, current run-rate profit performance is at a broadly similar level to H2 2024. We are successfully executing our Optimisation programme, which will deliver additional profit benefits as we move into H2 2025. Our continued focus on cost control and progressing our strategic actions is ensuring we are well positioned to capitalise when markets recover. We remain confident in the delivery of our medium-term financial targets. Commenting, Jim Fairbairn, Group Chief Executive, said: “ We delivered a resilient performance in 2024, with our core business growing organically pre-surcharges and good margin improvement despite challenging conditions in many of our end markets. This was driven by Specialist Technologies where we saw good growth and strong margin improvement, as well as decisive cost control actions taken in our Automotive and Industrial Precision Heat Treatment businesses. At our Capital Markets Event in December we laid out a simplified reporting structure, a new strategic approach, and a set of comprehensive financial targets. Going forwards our reporting will be based on two leading, technology-focused divisions: Specialist Technologies and Precision Heat Treatment. Our strategy consists of three key levers: Optimise, Perform and Grow. Through these levers we will enhance the quality of the business, improve our operational performance and accelerate growth, all supported by sustainability. Underpinned by these actions, we also announced a set of compelling medium-term financial targets. We have already begun to deliver on these strategic initiatives, including commencing with our plant footprint optimisation, rolling out the HEAT programme to initial pilot sites, and proceeding with initial growth investments aligned to our target areas. We are already seeing tangible early benefits from these actions. I believe there is a significant opportunity in front of us to reach Bodycote's full potential and to deliver greater shareholder value. With a new strategy, simplified reporting structure, and ambitious but achievable targets in place our focus is now on execution.\"   1        Adjusted performance measures, Core measures, and measures excluding surcharges represent the statutory results excluding certain items and are considered alternative performance measures (APMs). A reconciliation to the nearest IFRS equivalent is provided at the end of this Full Year 2024 Results (hereafter ‘Report’). 2        An earnings per share reconciliation is provided in note 5 to the condensed consolidated financial statements. 3        Organic measures are stated at constant currency and exclude contributions from acquisitions. Further details are provided at the end of this Report. 4        The definition of the cash flow APMs have been modified and prior year figures have been restated. Refer to the Financial Review for more information. END   Full Year Results Presentation Bodycote will host a presentation for investors and analysts at 09.30 am GMT on 14 March 2025 .   The presentation will also be webcast live. Please find connection instructions below:   Webcast: https://www.bodycote.com/webcast2024 Conference call details: United Kingdom local: +44 20 3936 2999 United Kingdom (Toll-free): +44 800 358 1035 International: +44 20 3936 2999 Participant Code:   747320   A replay of the audiocast and presentation will also be available at www.bodycote.com in the investor section after the event.   For further information, please contact: \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Bodycote plc \t\t\t Jim Fairbairn, Group Chief Executive \t\t\t Ben Fidler, Chief Financial Officer \t\t\t Peter Lapthorn, Investor Relations & FP&A \t\t\t Tel: +44 1625 505 300 \t\t\t \t\t\t \t\t\t FTI Consulting \t\t\t Richard Mountain \t\t\t Susanne Yule \t\t\t Tel: +44 203 727 1340 \t\t\t \t\t \t   About Bodycote plc Bodycote is the world's largest provider of thermal processing services with more than 150 locations in 22 countries. Through Specialist Technologies and Precision Heat Treatment, Bodycote improves the properties of metals and alloys, extending the life of vital components for a wide range of industries, including Aerospace, Defence, Automotive, Power Generation, Oil & Gas, Construction, Medical and Transportation. Customers have entrusted their products to Bodycote's care for more than 50 years. For more information, visit www.bodycote.com . Full Year Commentary Core Overview Core revenue grew by 1.0% organically in 2024, excluding surcharges. This was despite a challenging market environment, with both North America and Western Europe seeing low levels of demand in Automotive and Industrial Markets. The resilient performance reflected further growth in Specialist Technologies (+5.0% organic, excluding surcharges), partly offset by a modest decline in Precision Heat Treatment (-0.8%). Growth in Specialist Technologies was supported by market share gains, continued efforts to expand the addressable market with new applications, as well as strong demand globally in Aerospace & Defence and Energy markets. Precision Heat Treatment delivered good growth globally in Aerospace & Defence and outperformed a challenging Automotive market, supported by growth in Emerging Markets and new customer wins in Western Europe. The modest revenue decline was driven by soft demand in North America and Europe across Industrial, Consumer and Medical markets. Profitability in our Core business improved significantly year-on-year, with adjusted operating profit up 2.9% organically to £127.6m and margins 120bps higher at 17.9%. The improvement was led by Specialist Technologies, where adjusted operating margins increased by 300bps to 29% thanks to improved utilisation, better operational performance in our HIP business, and a positive contribution from the Lake City business acquired in January 2024. Precision Heat Treatment margins were resilient at 17.0% (down 60bps year-on-year), which reflected the soft volume environment and the non-recurrence of government energy grants received in 2023, offset by decisive cost actions taken in the year. Central costs also reduced year-on-year reflecting tight cost control and a lower level of incentive-based pay, which is expected to normalise in 2025. Group Overview Including Non-Core businesses, total Group revenue was £757.1m (2023: £802.5m), 5.7% lower year-on-year and 3.9% lower organically excluding the impact of Lake City. This reflected 1.0% organic growth in the Core business excluding surcharges, offset by the decline in Non-Core revenue, FX headwinds, and a significant fall in surcharges year-on-year, which reduced by around 50% due to the normalisation of energy prices. Group adjusted operating profit of £129.0m was modestly higher year-on-year (2023: £127.6m), representing a significant improvement in margins to 17.0% (+110bps). Our Non-Core businesses, which are almost entirely focused on European and North American Automotive and Industrial markets, declined during the year. Revenue was down by 17.1% organically to £44.6m and adjusted operating margins reduced by 200bps to 3.1%. This business represents a small number of sites with lower differentiation and a less attractive financial profile than the rest of the Group. The difference in performance between our Core Precision Heat Treatment division and the Non-Core division in 2024 demonstrates the higher quality and greater resilience of our Core business. As outlined at our December 2024 Capital Markets Event, we plan to exit all Non-Core activity as part of our Optimise programme to enhance the quality and profitability of the Group. Group statutory operating profit reduced year-on-year to £37.9m (2023: £119.2m). This was due to the impact of previously indicated one-off charges, which totalled £78.3m in 2024. In H1 we announced a £28.4m impairment charge arising from the decision to cease the rollout of the operations module of our ongoing ERP upgrade programme. In addition, as part of the Optimise programme announced at our December 2024 Capital Markets Event, we recognised a £31.9m restructuring charge. This programme will deliver a significant improvement in the quality of our plant portfolio and in our financial performance. Finally, goodwill of £18.0m was impaired in H2 2024, relating to our North American Automotive and Industrial focused activities, which have seen challenging market conditions and carry a high level of associated goodwill from historical acquisitions. Basic adjusted earnings per share grew to 48.6p (2023: 48.4p), reflecting higher operating profit offset by a 125bp increase in the tax rate and higher finance costs. The lower statutory operating profit resulted in basic earnings per share of 10.8p (2023: 45.1p). Adjusted operating cash flow of £115.5m was 2.9% ahead of the prior year (2023: £112.2m), driven by the growth in adjusted operating profit alongside lower capital expenditure, partly due to the timing of investment in key projects around year-end. Free cash flow was lower year-on-year at £70.6m (2023: £95.2m), which reflected a higher level of cash tax compared with the prior year, which had benefited from a substantial tax refund. The closing net debt position, excluding lease liabilities, was £68.3m, reflecting the acquisition of Lake City (£54.9m including acquisition costs) and the share buyback programme (£57.7m executed in 2024) compared with a net cash position of £12.6m at year end 2023. The Group continues to have a strong balance sheet and leverage remains low with net debt / adjusted EBITDA of approximately 0.3x (excluding lease liabilities). Divisional Performance   \t \t\t \t\t\t \t\t\t \t\t\t \t\t\t Specialist Technologies   \t\t\t \t\t\t \t\t\t \t\t\t 2024   \t\t\t \t\t\t \t\t\t \t\t\t 2023   \t\t\t \t\t\t \t\t\t Organic \t\t\t Growth     \t\t\t \t\t\t \t\t\t \t\t\t Growth   \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t 224.2 \t\t\t \t\t\t \t\t\t 212.4 \t\t\t \t\t\t \t\t\t +3.3% \t\t\t \t\t\t \t\t\t +5.6% \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t Adjusted operating profit \t\t\t \t\t\t \t\t\t 65.0 \t\t\t \t\t\t \t\t\t 55.2 \t\t\t \t\t\t \t\t\t +12.8% \t\t\t \t\t\t \t\t\t +17.5% \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t Adjusted operating margin \t\t\t \t\t\t \t\t\t 29.0% \t\t\t \t\t\t \t\t\t 26.0% \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t +300bps \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t Precision Heat Treatment   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023  \t\t\t \t\t\t \t\t\t Organic \t\t\t Growth \t\t\t \t\t\t \t\t\t   \t\t\t Growth  \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t 488.3 \t\t\t \t\t\t \t\t\t 534.9 \t\t\t \t\t\t \t\t\t -5.3% \t\t\t \t\t\t \t\t\t -8.7% \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t Adjusted operating profit \t\t\t \t\t\t \t\t\t 83.0 \t\t\t \t\t\t \t\t\t 94.4 \t\t\t \t\t\t \t\t\t -8.4% \t\t\t \t\t\t \t\t\t -12.1% \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t Adjusted operating margin \t\t\t \t\t\t \t\t\t 17.0% \t\t\t \t\t\t \t\t\t 17.6% \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t -60bps \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t   Non-Core \t\t\t \t\t\t \t\t\t 2024   \t\t\t \t\t\t \t\t\t 2023  \t\t\t \t\t\t \t\t\t Organic \t\t\t Growth   \t\t\t \t\t\t \t\t\t   \t\t\t Growth  \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t 44.6 \t\t\t \t\t\t \t\t\t 55.2 \t\t\t \t\t\t \t\t\t -17.1% \t\t\t \t\t\t \t\t\t -19.2% \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t Adjusted operating profit \t\t\t \t\t\t \t\t\t 1.4 \t\t\t \t\t\t \t\t\t 2.8 \t\t\t \t\t\t \t\t\t -52.7% \t\t\t \t\t\t \t\t\t -50.0% \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t Adjusted operating margin \t\t\t \t\t\t \t\t\t 3.1% \t\t\t \t\t\t \t\t\t 5.1% \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t -200bps \t\t\t \t\t \t\t \t\t\t \t\t\t \t\t\t \t\t\t \t\t\t \t\t\t \t\t \t   Specialist Technologies delivered a good performance in 2024 despite the mixed market environment, demonstrating the strong underlying characteristics of this set of differentiated technologies. Organic revenue growth was 3.3%, and 5.0% excluding surcharges, which reflected good growth in both North America and Europe in Aerospace and Defence, as well as growth in Energy supported by market share gains. We also continue to drive above market growth by expanding the addressable market in Specialist Technologies with new applications. To keep pace with the demand growth in Specialist Technologies, capacity expansions were made during the year in both HIP and S 3 P, focused primarily in North America. Operating margin improved by 300bps during the year to 29.0%, driven by a significant improvement in operational performance in our HIP business, as well as volume benefits and pricing improvements on long-term contracts secured in Surface Technology. The acquisition of Lake City was completed in January 2024 and has proved an excellent fit for the Group, delivering strong profit performance in 2024. Precision Heat Treatment performance reflected the challenging market conditions in 2024, offset by decisive cost control actions. Industrial demand softened through the year in both Europe and the US, and demand was also sluggish in Automotive across developed markets. Despite this backdrop, performance in Precision Heat Treatment was resilient. Revenue was down 5.3% organically, however the majority of this was driven by lower energy surcharges with organic revenue down just 0.8% excluding surcharges. The business outperformed its underlying end markets in Automotive, driven by good growth in Emerging Markets and market share gains in Europe. There was also strong growth in both Europe and North America in Aerospace & Defence. These tailwinds helped to offset the majority of the broader weakness in developed markets industrial demand. Cost agility was a key focus during the year, with a number of decisive actions taken to reduce capacity and flex labour cost to meet the level of market demand. Operating margins reduced by 60bps in the year, to 17.0%, driven by soft volumes coupled with the non-repeat of energy grants received in 2023, partly offset by stringent cost control measures. Strategic progress: Optimise, Perform, Grow As outlined at our Capital Markets Event in December, our strategy consists of three key levers: Optimise, Perform, and Grow, which are focused on creating a higher quality, more efficient and faster growing Bodycote. We have already begun to make good early progress executing on these levers in 2024. Optimise: approximately 6% of Group revenue has been classified as Non-Core (FY 2024: £45m).This comprises heat treatment activity with lower differentiation and financial characteristics that do not fit with our revised strategy and focus. A significant portion of this revenue will be transferred to other more profitable sites in our network at a higher margin, while the remainder will be exited. We are also making a number of reductions to our overhead cost base, enabled by the smaller footprint. Work has already commenced on transferring or exiting activity in over a third of the impacted locations, and approximately one third of the targeted overhead cost reductions have been completed. We anticipate a benefit of low-to-mid single-digit millions of pounds to adjusted operating profit in 2025, reflecting the gradual transfer of customer sales, with the full run-rate benefit of £12m-14m expected to be reached by the end of 2026. Perform: the HEAT framework will enable us to deliver more consistent and sustained levels of performance . It will embed systematically across the Group a high performance culture, enhanced service quality, and a more agile cost base, while also enabling us to transition to a sustainable future. Once in place, this approach will drive a significant improvement in our operational performance and margins. Our new Chief Excellence Officer will join the business in June 2025, with a focus on driving these Group-wide operational improvements. We have already rolled-out the key elements of HEAT to a select group of pilot sites which represent around 10% of our total footprint. We are seeing early benefits materialise in these pilot sites, and in 2025 we expect to begin the group-wide rollout of HEAT, with more material benefits to begin from 2026. Grow: we see potential for a significant acceleration in growth and aim to deliver mid-single-digit revenue growth through the cycle. To achieve this, we are focused on a number of higher-growth and higher-margin areas, including structural growth end markets, driving adoption of Specialist Technologies and more advanced heat treatment processes, and expanding in attractive geographies. In 2024 we compiled a funnel of initiatives in these target areas, and we have begun to allocate management resource and capital to specific projects. In 2025 this includes Specialist Technologies expansion projects across HIP, S 3 P, and Surface Technology in North America, Europe and Asia. In Precision Heat Treatment, investment is focused on modernising and expanding our Aerospace footprint in North America, as well as capacity expansions in Turkey and China. Our growth strategy will also be supported by improved commercial capability and inter-divisional collaboration. Our new Chief Marketing Officer joined in late 2024 and is building capability in strategic marketing and key account management. In addition, we are aiming to leverage our ability to reduce our customers’ carbon emissions to drive revenue growth. We have developed proprietary tools to demonstrate the carbon reductions we can offer, and have now trained our sales teams and deployed these tools. Live discussions are ongoing with a number of large customers on our sustainability offering. Sustainability The increasing pressure to decarbonise provides a growing opportunity to support customers in achieving their sustainability goals. Our suite of energy efficient processes in both Specialist Technologies and Precision Heat Treatment can help customers to reduce their emissions and environmental impact. Outsourcing is already recognised by customers as one of the key levers for achieving their carbon reduction targets, some of whom would pay a premium for a more sustainable service. We are focused on developing and executing our strategy to capture sustainability-related growth opportunities, and we have recently launched three new environmental targets: \t By 2030, to reduce our absolute Scope 1 and 2 greenhouse gas emissions by 46% versus 2019 levels. This now aligns to a 1.5°C pathway, enhancing our existing SBTi approved target of a 28% reduction which we achieved in 2024, six years early. \t To enable our customers of atmospheric processing to avoid at least 125,000 tonnes of CO2e by 2030. This target has been externally validated and is aligned with best practice guidance.   \t An increase in the share of revenue which supports sustainable end-use markets to at least 20% by 2035 (from 7% in 2023). This year, we have also broadened our emissions measurement to include a full Scope 3 emissions inventory and set ourselves new supply chain goals. These include targets to reduce emissions from our fuel and energy-related activities by 45% by 2030, and for 30% of our suppliers to have an SBTi or equivalent carbon reduction target by 2030. Over the next 12-18 months we will build on this work to develop our longer-term decarbonisation strategy and evaluate our roadmap towards net zero. Summary and outlook All guidance comments are provided on an organic basis We delivered a resilient performance in 2024 despite a challenging market backdrop. Core revenue grew by 1% organically, pre-surcharges, and Core adjusted operating margins reached 17.9%. This was led by strong performance in Specialist Technologies and supported by decisive cost actions taken in the adversely impacted areas of Precision Heat Treatment. End markets remain mixed, with challenging conditions in Automotive and Industrial. Structural demand in Aerospace & Defence remains strong, although there continues to be a temporary impact from industry-wide supply chain disruption. Reflecting this backdrop, current run-rate profit performance is at a broadly similar level to H2 2024. We are successfully executing our Optimisation programme, which will deliver additional profit benefits as we move into H2 2025. Our continued focus on cost control and progressing our strategic actions is ensuring we are well positioned to capitalise when markets recover. We remain confident in the delivery of our medium-term financial targets.      Chief Financial Officer’s report “A resilient performance with good margin progression despite challenging end markets.” B. Fidler Chief Financial Officer Financial overview \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t £m \t\t\t \t\t\t \t\t\t 2023 \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t 757.1 \t\t\t \t\t\t \t\t\t 802.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Adjusted operating profit \t\t\t \t\t\t \t\t\t 129.0 \t\t\t \t\t\t \t\t\t 127.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Exceptional charges \t\t\t \t\t\t \t\t\t (78.3) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Amortisation of acquired intangible assets \t\t\t \t\t\t \t\t\t (10.4) \t\t\t \t\t\t \t\t\t (8.1) \t\t\t \t\t \t\t \t\t\t \t\t\t Acquisition costs \t\t\t \t\t\t \t\t\t (2.4) \t\t\t \t\t\t \t\t\t (0.3) \t\t\t \t\t \t\t \t\t\t \t\t\t Operating profit \t\t\t \t\t\t \t\t\t 37.9 \t\t\t \t\t\t \t\t\t 119.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Net finance charge \t\t\t \t\t\t \t\t\t (9.5) \t\t\t \t\t\t \t\t\t (7.5) \t\t\t \t\t \t\t \t\t\t \t\t\t Profit before taxation \t\t\t \t\t\t \t\t\t 28.4 \t\t\t \t\t\t \t\t\t 111.7 \t\t\t \t\t \t\t \t\t\t \t\t\t Taxation charge \t\t\t \t\t\t \t\t\t (7.7) \t\t\t \t\t\t \t\t\t (24.9) \t\t\t \t\t \t\t \t\t\t \t\t\t Profit for the year \t\t\t \t\t\t \t\t\t 20.7 \t\t\t \t\t\t \t\t\t 86.8 \t\t\t \t\t \t Group revenue decreased by 5.7% to £757.1m (2023: £802.5m) at actual exchange rates and 2.6% at constant currency. The fall in revenue reflected a 47% reduction in energy surcharges to £35.6m (2023: £66.8m) as energy prices normalised. At constant FX rates and normalised for surcharges, revenue performance was stable, increasing by 1.3% (-0.1% organic). Despite the challenging end markets, adjusted operating profit for the year increased by 1.1% to £129.0m (2023: £127.6m), representing growth of 4.9% at constant currency (+1.7% organic). Adjusted operating margin further improved to 17.0% (2023: 15.9%) reflecting good growth in Specialist Technologies and pro-active cost management in Precision Heat Treatment in response to the challenging conditions in Automotive and Industrial markets. Statutory operating profit was £37.9m (2023: £119.2m) after a charge of £78.3m for exceptional items (see below). Excluding the non-core businesses which we plan to exit as part of the Optimise programme, Core revenue reduced by 4.7%. On an organic basis and excluding the impact of lower surcharges, Core revenue increased by 1.0%, demonstrating the stronger underlying growth potential of the Core business despite challenging market conditions. Core adjusted operating margins increased by 120bps to 17.9%. Exceptional items Exceptional charges for the year of £78.3m (2023: £nil) comprised £28.4m in respect of the write-down of the Group’s ERP system; £31.9m in respect of the Group’s strategic Optimisation programme; and a £18.0m goodwill impairment in respect of our North American Automotive and Industrial focused operations.   The Group has been developing a new enterprise-wide ERP solution, and after a detailed evaluation the decision was taken in June 2024 to cease further investment in the Operations module. This decision significantly reduced risk and future implementation costs but has resulted in an impairment charge of £28.4m which was recorded as an exceptional item in the first half of the year. As part of the Group’s strategic review, we announced a number of Optimisation actions to enhance the quality of our plant footprint and improve operational and financial performance. The associated plant closures and overhead cost reduction actions led to an exceptional cost of £31.9m in the year comprising £4.1m of severance costs and £27.8m of asset write-downs and site closure costs, including a loss of £2.7m on the sale of a site in France. An £18.0m goodwill impairment was taken related to our North American Automotive and Industrial focused operations in Precision Heat Treatment. This area of our business has seen challenging market conditions for a number of years and has a high level of associated goodwill based on historical acquisitions. Further detail can be found in note 6 to the condensed consolidated financial statements. Net finance charge The net finance charge increased to £9.5m (2023: £7.5m), as summarised in the table below: \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t £m \t\t\t \t\t\t \t\t\t 2023 \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Interest on loans and bank overdrafts \t\t\t \t\t\t \t\t\t (3.9) \t\t\t \t\t\t \t\t\t (2.7) \t\t\t \t\t \t\t \t\t\t \t\t\t Interest on lease and pension liabilities \t\t\t \t\t\t \t\t\t (3.0) \t\t\t \t\t\t \t\t\t (2.7) \t\t\t \t\t \t\t \t\t\t \t\t\t Financing and bank charges \t\t\t \t\t\t \t\t\t (3.4) \t\t\t \t\t\t \t\t\t (2.9) \t\t\t \t\t \t\t \t\t\t \t\t\t Total finance charge \t\t\t \t\t\t \t\t\t (10.3) \t\t\t \t\t\t \t\t\t (8.3) \t\t\t \t\t \t\t \t\t\t \t\t\t Interest received \t\t\t \t\t\t \t\t\t 0.8 \t\t\t \t\t\t \t\t\t 0.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Net finance charge \t\t\t \t\t\t \t\t\t (9.5) \t\t\t \t\t\t \t\t\t (7.5) \t\t\t \t\t \t The increase in interest charges during the year were driven primarily by higher borrowing as a result of the acquisition of Lake City Heat Treating in January 2024 and outflows in respect of share buybacks of £57.7m in the year. Profit before taxation \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t £m \t\t\t \t\t\t \t\t\t 2023 \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Adjusted profit before taxation \t\t\t \t\t\t \t\t\t 119.5 \t\t\t \t\t\t \t\t\t 120.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Exceptional charges \t\t\t \t\t\t \t\t\t (78.3) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Amortisation of acquired intangibles \t\t\t \t\t\t \t\t\t (10.4) \t\t\t \t\t\t \t\t\t (8.1) \t\t\t \t\t \t\t \t\t\t \t\t\t Acquisition costs \t\t\t \t\t\t \t\t\t (2.4) \t\t\t \t\t\t \t\t\t (0.3) \t\t\t \t\t \t\t \t\t\t \t\t\t Profit before taxation \t\t\t \t\t\t \t\t\t 28.4 \t\t\t \t\t\t \t\t\t 111.7 \t\t\t \t\t \t Adjusted profit before tax remained broadly in line with the prior year at £119.5m (2023: £120.1m) at actual exchange rates, reflecting our active management of the cost base in light of the challenging end market conditions. Statutory profit before taxation fell to £28.4m (2023: £111.7m). This reflected the impact of exceptional charges of £78.3m, as well as higher amortisation of acquired intangibles and acquisition costs, both as a result of the Lake City Heat Treating acquisition. Taxation The tax charge for the year was £7.7m (2023: £24.9m). The adjusted tax rate for the Group was 23.8% (2023: 22.5%), before accounting for amortisation of acquired intangibles, acquisition costs and exceptional items. This was in line with our expectations. The Group’s overall tax rate reflects the blended average of the tax rates in the jurisdictions around the world in which the Group trades and generates profit. Looking ahead, the adjusted tax rate is expected to moderately increase over the next few years. The effective statutory tax rate was 27.1% (2023: 22.3%) with the increase reflecting that not all of the exceptional costs were deductible. Provisions of £24.9m (2023: £26.4m) are carried in respect of potential future tax assessments related to ‘open’ historical tax years. Note 4 of the condensed consolidated financial statements provides more information. The OECD Pillar II Rules for a global minimum tax rate have been applicable to the Group from 1 January 2024. The changes have not had a material impact on the Group’s tax charge in 2024. Earnings per share Basic adjusted earnings per share increased 0.4% to 48.6p (2023: 48.4p) reflecting the improved operating profit and the impact of share buybacks during the year, offset by higher interest costs and the higher adjusted tax rate. Basic statutory earnings per share for the year decreased to 10.8p (2023: 45.1p) reflecting the exceptional charges recorded in the year. Note 5 of the condensed consolidated financial statements provides further details of the basis of these calculations.   \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t £m \t\t\t \t\t\t \t\t\t 2023 \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Profit for the year \t\t\t \t\t\t \t\t\t 20.7 \t\t\t \t\t\t \t\t\t 86.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Attributed to non-controlling interests \t\t\t \t\t\t \t\t\t (0.7) \t\t\t \t\t\t \t\t\t (1.2) \t\t\t \t\t \t\t \t\t\t \t\t\t Earnings attributable to equity holders of the parent \t\t\t \t\t\t \t\t\t 20.0 \t\t\t \t\t\t \t\t\t 85.6 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Weighted average number of ordinary shares in issue \t\t\t \t\t\t \t\t\t 186,012,493 \t\t\t \t\t\t \t\t\t 189,877,099 \t\t\t \t\t \t\t \t\t\t \t\t\t Basic adjusted EPS \t\t\t \t\t\t \t\t\t 48.6p \t\t\t \t\t\t \t\t\t 48.4p \t\t\t \t\t \t\t \t\t\t \t\t\t Basic EPS \t\t\t \t\t\t \t\t\t 10.8p \t\t\t \t\t\t \t\t\t 45.1p \t\t\t \t\t \t Return on capital employed Return on capital employed rose by 90bps in the year to 15.7% from 14.8% in 2023. The increase reflects improvement in adjusted operating profit together with the Group’s disciplined approach to the capital expenditure projects, focused on delivering the Group’s strategy and driving attractive returns. Cash flow \t \t\t \t\t\t \t\t\t Adjusted operating profit \t\t\t \t\t\t \t\t\t 129.0 \t\t\t \t\t\t \t\t\t 127.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Depreciation and amortisation \t\t\t \t\t\t \t\t\t 75.3 \t\t\t \t\t\t \t\t\t 74.0 \t\t\t \t\t \t\t \t\t\t \t\t\t Other, including impairment and profit on disposal of PPE \t\t\t \t\t\t \t\t\t (5.6) \t\t\t \t\t\t \t\t\t (2.7) \t\t\t \t\t \t\t \t\t\t \t\t\t Adjusted EBITDA 1 \t\t\t \t\t\t \t\t\t 198.7 \t\t\t \t\t\t \t\t\t 198.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Net capital expenditure \t\t\t \t\t\t \t\t\t (60.5) \t\t\t \t\t\t \t\t\t (72.0) \t\t\t \t\t \t\t \t\t\t \t\t\t Principal element of lease payments \t\t\t \t\t\t \t\t\t (13.5) \t\t\t \t\t\t \t\t\t (13.0) \t\t\t \t\t \t\t \t\t\t \t\t\t Provisions movement \t\t\t \t\t\t \t\t\t (7.3) \t\t\t \t\t\t \t\t\t (0.9) \t\t\t \t\t \t\t \t\t\t \t\t\t Net working capital movement \t\t\t \t\t\t \t\t\t (1.9) \t\t\t \t\t\t \t\t\t (0.8) \t\t\t \t\t \t\t \t\t\t \t\t\t Adjusted operating cash flow \t\t\t \t\t\t \t\t\t 115.5 \t\t\t \t\t\t \t\t\t 112.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Restructuring \t\t\t \t\t\t \t\t\t (3.9) \t\t\t \t\t\t \t\t\t (1.6) \t\t\t \t\t \t\t \t\t\t \t\t\t Financing costs, net \t\t\t \t\t\t \t\t\t (8.9) \t\t\t \t\t\t \t\t\t (6.4) \t\t\t \t\t \t\t \t\t\t \t\t\t Tax, net \t\t\t \t\t\t \t\t\t (32.1) \t\t\t \t\t\t \t\t\t (9.0) \t\t\t \t\t \t\t \t\t\t \t\t\t Free cash flow \t\t\t \t\t\t \t\t\t 70.6 \t\t\t \t\t\t \t\t\t 95.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Net lease liability additions and disposals \t\t\t \t\t\t \t\t\t (0.7) \t\t\t \t\t\t \t\t\t (0.5) \t\t\t \t\t \t\t \t\t\t \t\t\t Ordinary dividend \t\t\t \t\t\t \t\t\t (42.9) \t\t\t \t\t\t \t\t\t (40.6) \t\t\t \t\t \t\t \t\t\t \t\t\t net Acquisition spend \t\t\t \t\t\t \t\t\t (55.6) \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t \t\t \t\t\t \t\t\t Ordinary shares purchased for share buyback \t\t\t \t\t\t \t\t\t (57.7) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Own shares purchased less share-based payments \t\t\t \t\t\t \t\t\t 0.6 \t\t\t \t\t\t \t\t\t (8.1) \t\t\t \t\t \t\t \t\t\t \t\t\t Reduction in net debt \t\t\t \t\t\t \t\t\t (85.7) \t\t\t \t\t\t \t\t\t 45.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Opening net debt \t\t\t \t\t\t \t\t\t (51.7) \t\t\t \t\t\t \t\t\t (99.4) \t\t\t \t\t \t\t \t\t\t \t\t\t Foreign exchange movements \t\t\t \t\t\t \t\t\t 5.6 \t\t\t \t\t\t \t\t\t 1.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Closing net debt \t\t\t \t\t\t \t\t\t (131.8) \t\t\t \t\t\t \t\t\t (51.7) \t\t\t \t\t \t\t \t\t\t \t\t\t Lease liabilities \t\t\t \t\t\t \t\t\t 63.5 \t\t\t \t\t\t \t\t\t 64.3 \t\t\t \t\t \t\t \t\t\t \t\t\t Net (debt)/cash excluding lease liabilities \t\t\t \t\t\t \t\t\t (68.3) \t\t\t \t\t\t \t\t\t 12.6 \t\t\t \t\t \t 1   Refer to the APM section of the 2024 Annual report for a reconciliation of EBITDA to Adjusted EBITDA 2   In 2024 the definition of adjusted operating cash flow has been updated to include expansionary capital expenditure, which was previously reflected outside free cash flow. In addition, adjusted operating cash flow has been restated to include principal element of lease payments and exclude non-cash movements in net debt arising from lease liability asset additions and disposals. These changes aim to bring the definition of adjusted operating cash flow closer to market norms. A reconciliation to adjusted operating cash flow and free cash flow as previously stated is included in the APM section of the 2024 Annual report. Adjusted operating cash flow increased to £115.5m (2023: £112.2m), a conversion ratio of 90% (2023: 88%), as a result of the improved operating profit and lower capital expenditure, due partly to timing and partly to additional discipline around our capital spend given the challenging market conditions. These tailwinds were partially offset by higher provision outflows (£6.4m higher year-on-year) driven almost entirely by a first half payment to resolve a historical environmental issue that was fully provided for. Free cash flow fell to £70.6m (2023: £95.2m) for the year. This was driven almost entirely by higher tax, with net tax payments in 2024 of £32.1m compared with just £9.0m in 2023. The low level of payments in 2023 reflected the receipt of tax refunds relating to prior years and other timing differences. The statutory measure, net cash from operating activities, fell to £152.6m (2023: £191.6m) largely reflecting the increased cash tax outflows in the year and the payments to resolve the historical environmental issue. Closing net debt was £131.8m (2023: £51.7m). Excluding lease liabilities, the Group moved from a net cash position of £12.6m in 2023 to a net debt of £68.3m in 2024 after returning £100.6m (2023: £40.6) to shareholders through dividends and share buybacks and after acquisition spend relating to Lake City Heat Treating of £54.9m (including acquisition costs). Capital expenditure Total capital expenditure in the year - including both maintenance and expansionary - was £60.5m (2023: £72.0m). The reduction year-on-year was partly driven by the timing of payments on certain projects around year-end, and partly by decisions taken during the second half of the year to delay certain investments in response to the challenging market environment. The Group remains committed to maintaining its assets to the highest standards of quality and safety. Dividend and dividend policy The Group has a long and stable track record of dividend growth and aims to pay ordinary dividends so that dividend cover will be at or above 2.0 times earnings on a ‘normalised’ multi-year basis. In line with this policy, the Board has recommended a final dividend of 16.1p (2023: 16.0p), bringing the full year dividend to 23.0p (2023: 22.7p). The interim dividend of 6.9p, approved by the Board on 30 July 2024, was paid on 7 November 2024 to shareholders on the register at the close of business on 4 October 2024. Subject to shareholder approval at the 2025 AGM, the final dividend will be paid on 5 June 2025 to shareholders on the register at the close of business on 25 April 2025. Borrowing facilities During the year the Group renewed and extended its existing Revolving Credit Facility by over two years. The Group is financed by a mix of cash flows from operations, short-term borrowings and leases. The Group’s funding policy aims to ensure continuity of financing at a reasonable cost, based on committed and uncommitted facilities and loans to be procured from several banking partners. The Group continues to have access to committed facilities at competitive rates and currently deems this to be the most effective means of long-term funding. At 31 December 2024, the facility was drawn as follows:   \t \t\t \t\t\t \t\t\t Facility \t\t\t \t\t\t \t\t\t Expiry \t\t\t date \t\t\t \t\t\t \t\t\t Facility \t\t\t £m \t\t\t \t\t\t \t\t\t Facility \t\t\t utilisation \t\t\t £m \t\t\t \t\t\t \t\t\t Facility \t\t\t headroom \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Revolving Credit Facility \t\t\t \t\t\t \t\t\t 19 September 2029 \t\t\t \t\t\t \t\t\t 251 \t\t\t \t\t\t \t\t\t 84.3 \t\t\t \t\t\t \t\t\t 166.7 \t\t\t \t\t \t   In addition to the Revolving Credit Facility, the Group also has access to an additional committed facility of £8.7m (undrawn) bringing total committed facility headroom to £175.4m at 31 December 2024 (2023: £228.3m). Group principal risks and uncertainties The Board is committed to protecting and enhancing the Group’s interests through the effective management of risk. As a global business operating in 22 countries we understand that effectively managing risk underpins the successful performance of the Group. The Board has ultimate responsibility for the Group’s systems of risk management and internal control and ensures the Group’s risk processes and systems of internal control are robust, monitored and evolve to address changing business conditions and threats. The Board determines the Group’s risk appetite and ensures that the Group’s exposures to risk are appropriate and align to the Group’s strategic levers and priorities. The Board also provides direction and sets the tone on the importance of risk management. The review of financial risk has been delegated to the Group’s Audit Committee. Emerging risk Bodycote’s emerging risk identification process is based on horizon scanning. Each emerging risk is assessed based on its potential impact on the Group on a high, medium or low rating across three time horizons: 0-2 years; 2-5 years; and more than five years. This process takes place alongside the annual risk review, with emerging risks being considered in facilitated risk workshops conducted with the Executive Committee. This review helps to ensure that any new and emerging risks are appropriately identified and ensures close monitoring of any emerging risks to ensure appropriate mitigating actions are undertaken. As an international Group operating in multiple countries, the Group inevitably has exposure to a range of risks and uncertainties where internal and external factors are considered and inform the Group’s response to managing such risks, many of which are similar in nature to those experienced by comparable companies and may not always be within the Group’s control. The Board has highlighted geopolitical risk, specifically, the unpredictable geopolitical landscape and the uncertainty over future global events as an emerging risk. If tensions in the geopolitical landscape result in the implementation of aggressive trade barriers that reduce the movement of goods, this could result in customers shortening their supply chains and moving them closer to their main production locations. The emerging risk is mitigated by the fact that Bodycote has a global network of sites which allow us to service customers from multiple locations, such that the residual risk exposure is not considered significant. An additional area of emerging risk identified during the year relates to the Group’s ability to attract, retain and develop key skills, knowledge and capabilities. As the global employment environment continues to evolve, attracting new talent to the industry, particularly in engineering and operations will become an increasing priority. The Group appointed a new Chief Human Resources Officer in January 2025 who will drive the Group’s people and transformation process going forward. Group principal risks The principal risks and uncertainties outlined in the strategic report of the 2024 Annual report set out a description of the Group’s principal risks and related mitigation measures, as agreed by the Board, and describe how these principal risks may affect Bodycote’s ability to deliver its strategy. The identified principal risks relate to: •           Markets and competitor action; •           Health and safety; •           Climate change ; •           Operational risks covering service quality, contract review, loss of key accreditations, major disruption at a facility, machine downtime, information technology and cybersecurity, and investment and capital deployment; and •           Regulatory and legislative compliance risks.   The risk of global pandemics and their impact on both supply chain issues and operations are no longer considered as either an emerging or principal risk for the Group.   Alternative performance measures (APMs) To provide additional information and analysis and to enable a full understanding of the Group’s results, management makes use of a number of APMs in its internal management of the business and as part of its internal and external reporting. During the year the Group has renamed a number of its APMs from headline to adjusted with no change to their definition other than where explained. These APMs can be found in the APMs section below.   Going concern As described in 2024 Annual report, the Directors have formed a judgement, at the time of approving the financial statements, that there are no material uncertainties that cast doubt on the Group’s going concern status and that it is a reasonable expectation that the Group has adequate resources to continue in operational existence for at least the next 12 months. In making this judgement, they have considered the impacts of potential severe but plausible consequences arising from the Group’s activities. For this reason, the Directors continue to adopt the going concern basis in preparing the condensed consolidated financial statements.   Directors’ responsibilities statement This responsibilities statement has been prepared in connection with the Group consolidated financial statements, extracts of which are included within this announcement.   The Directors confirm that to the best of their knowledge: •        The condensed consolidated financial statements included in this document are derived from the audited consolidated financial statements of the Group, prepared in accordance with UK-adopted international accounting standards (they do not contain sufficient information to comply with UK-adopted international accounting standards); •        The Group's consolidated financial statements, prepared in accordance with UK-adopted internal accounting. standards, give a true and fair view of the assets, liabilities, financial position, cash flows and profit of the Group; •        There have been no significant individual related party transactions during the year; and •        There have been no significant changes in the Group's related party relationships from that reported in the half-yearly results for the six months ended 30 June 2024.   The Group's consolidated financial statements, and related notes, including this responsibilities statement, were approved by the Board and authorised for issue on 13 March 2025 and were signed on their behalf by:   By order of the Board,   Director   Director J. Fairbairn   B. Fidler   Audited financial information The condensed consolidated financial statements and notes 1 to 12 for the year ended 31 December 2024 included below are derived from the Group’s consolidated financial statements which have been audited by PricewaterhouseCoopers LLP. The unmodified audit report is available for inspection at the Group’s registered office.   Consolidated income statement For the year ended 31 December 2024 \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Note \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t 1 \t\t\t \t\t\t \t\t\t 757.1 \t\t\t \t\t\t \t\t\t 802.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Cost of sales and overheads 1 \t\t\t \t\t\t \t\t\t 2 \t\t\t \t\t\t \t\t\t (647.8) \t\t\t \t\t\t \t\t\t (694.4) \t\t\t \t\t \t\t \t\t\t \t\t\t Other operating income \t\t\t \t\t\t \t\t\t 2 \t\t\t \t\t\t \t\t\t 9.7 \t\t\t \t\t\t \t\t\t 12.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Other operating expenses 1 \t\t\t \t\t\t \t\t\t 2 \t\t\t \t\t\t \t\t\t (0.4) \t\t\t \t\t\t \t\t\t (1.3) \t\t\t \t\t \t\t \t\t\t \t\t\t Net impairment losses on financial assets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (2.4) \t\t\t \t\t\t \t\t\t (0.2) \t\t\t \t\t \t\t \t\t\t \t\t\t Operating profit before exceptional items \t\t\t \t\t\t \t\t\t 1,2 \t\t\t \t\t\t \t\t\t 116.2 \t\t\t \t\t\t \t\t\t 119.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Exceptional items \t\t\t \t\t\t \t\t\t 3 \t\t\t \t\t\t \t\t\t (78.3) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Operating profit \t\t\t \t\t\t \t\t\t 2 \t\t\t \t\t\t \t\t\t 37.9 \t\t\t \t\t\t \t\t\t 119.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Finance income \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 0.8 \t\t\t \t\t\t \t\t\t 0.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Finance charges \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (10.3) \t\t\t \t\t\t \t\t\t (8.3) \t\t\t \t\t \t\t \t\t\t \t\t\t Profit before taxation \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 28.4 \t\t\t \t\t\t \t\t\t 111.7 \t\t\t \t\t \t\t \t\t\t \t\t\t Taxation charge \t\t\t \t\t\t \t\t\t 4 \t\t\t \t\t\t \t\t\t (7.7) \t\t\t \t\t\t \t\t\t (24.9) \t\t\t \t\t \t\t \t\t\t \t\t\t Profit for the year \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 20.7 \t\t\t \t\t\t \t\t\t 86.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Attributable to: \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Equity holders of the Parent \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 20.0 \t\t\t \t\t\t \t\t\t 85.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Non-controlling interests \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 0.7 \t\t\t \t\t\t \t\t\t 1.2 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 20.7 \t\t\t \t\t\t \t\t\t 86.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Earnings per share \t\t\t \t\t\t \t\t\t 5 \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Pence \t\t\t \t\t\t \t\t\t Pence \t\t\t \t\t \t\t \t\t\t \t\t\t Basic \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 10.8 \t\t\t \t\t\t \t\t\t 45.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Diluted \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 10.7 \t\t\t \t\t\t \t\t\t 44.8 \t\t\t \t\t \t   1     Excludes exceptional items. Total cost of sales and overheads, including exceptional items are £648.5m (2023: £694.4m), net impairment losses on financial assets are £2.7m (2023: £0.2m) and total other operating expenses including exceptional items are £77.7m (2023: £1.3m).   All activities have arisen from continuing operations.   Consolidated statement of comprehensive income For the year ended 31 December 2024 \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Note \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Profit for the year \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 20.7 \t\t\t \t\t\t \t\t\t 86.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Items that will not be reclassified to profit or loss: \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Actuarial losses on defined benefit pension schemes \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (0.3) \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t \t\t \t\t\t \t\t\t Tax on retirement benefit obligations that will not be reclassified \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Total items that will not be reclassified to profit or loss \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (0.4) \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t \t\t \t\t\t \t\t\t Items that may be reclassified subsequently to profit or loss: \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Exchange losses on translation of overseas operations \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (13.8) \t\t\t \t\t\t \t\t\t (29.7) \t\t\t \t\t \t\t \t\t\t \t\t\t Movements on hedges of net investments \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 4.1 \t\t\t \t\t\t \t\t\t 1.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Movements on cash flow hedges \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t\t \t\t\t 0.4 \t\t\t \t\t \t\t \t\t\t \t\t\t Total items that may be reclassified subsequently to profit or loss \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (9.8) \t\t\t \t\t\t \t\t\t (27.8) \t\t\t \t\t \t\t \t\t\t \t\t\t Total other comprehensive expense for the year \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (10.2) \t\t\t \t\t\t \t\t\t (27.9) \t\t\t \t\t \t\t \t\t\t \t\t\t Total comprehensive income for the year \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 10.5 \t\t\t \t\t\t \t\t\t 58.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Attributable to: \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Equity holders of the parent \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 10.1 \t\t\t \t\t\t \t\t\t 58.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Non-controlling interests \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 0.4 \t\t\t \t\t\t \t\t\t 0.4 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 10.5 \t\t\t \t\t\t \t\t\t 58.9 \t\t\t \t\t \t   Consolidated balance sheet At 31 December 2024 \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Note \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Non-current assets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Goodwill \t\t\t \t\t\t \t\t\t 6 \t\t\t \t\t\t \t\t\t 207.0 \t\t\t \t\t\t \t\t\t 221.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Other intangible assets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 114.4 \t\t\t \t\t\t \t\t\t 111.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Property, plant and equipment \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 481.2 \t\t\t \t\t\t \t\t\t 504.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Right-of-use assets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 56.4 \t\t\t \t\t\t \t\t\t 58.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Deferred tax assets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 7.0 \t\t\t \t\t\t \t\t\t 2.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Trade and other receivables \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2.8 \t\t\t \t\t\t \t\t\t 1.3 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 868.8 \t\t\t \t\t\t \t\t\t 900.0 \t\t\t \t\t \t\t \t\t\t \t\t\t Current assets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Inventories \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 28.1 \t\t\t \t\t\t \t\t\t 29.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Current tax assets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 10.1 \t\t\t \t\t\t \t\t\t 13.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Trade and other receivables \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 141.3 \t\t\t \t\t\t \t\t\t 148.4 \t\t\t \t\t \t\t \t\t\t \t\t\t Cash and bank balances \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 19.1 \t\t\t \t\t\t \t\t\t 45.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Assets held for sale \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 0.5 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 198.6 \t\t\t \t\t\t \t\t\t 236.7 \t\t\t \t\t \t\t \t\t\t \t\t\t Total assets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 1,067.4 \t\t\t \t\t\t \t\t\t 1,136.7 \t\t\t \t\t \t\t \t\t\t \t\t\t Current liabilities \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Trade and other payables \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 146.7 \t\t\t \t\t\t \t\t\t 122.7 \t\t\t \t\t \t\t \t\t\t \t\t\t Current tax liabilities \t\t\t \t\t\t \t\t\t 4 \t\t\t \t\t\t \t\t\t 32.2 \t\t\t \t\t\t \t\t\t 46.0 \t\t\t \t\t \t\t \t\t\t \t\t\t Borrowings \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 87.4 \t\t\t \t\t\t \t\t\t 32.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Lease liabilities \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 13.1 \t\t\t \t\t\t \t\t\t 11.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Provisions \t\t\t \t\t\t \t\t\t 7 \t\t\t \t\t\t \t\t\t 11.9 \t\t\t \t\t\t \t\t\t 12.0 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 291.3 \t\t\t \t\t\t \t\t\t 225.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Net current (liabilities)/assets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (92.7) \t\t\t \t\t\t \t\t\t 11.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Non-current liabilities \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Lease liabilities \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 50.4 \t\t\t \t\t\t \t\t\t 52.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Retirement benefit obligations \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 11.3 \t\t\t \t\t\t \t\t\t 11.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Deferred tax liabilities \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 41.2 \t\t\t \t\t\t \t\t\t 51.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Provisions \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2.5 \t\t\t \t\t\t \t\t\t 3.0 \t\t\t \t\t \t\t \t\t\t \t\t\t Other payables \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 0.8 \t\t\t \t\t\t \t\t\t 0.9 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 106.2 \t\t\t \t\t\t \t\t\t 119.3 \t\t\t \t\t \t\t \t\t\t \t\t\t Total liabilities \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 397.5 \t\t\t \t\t\t \t\t\t 344.4 \t\t\t \t\t \t\t \t\t\t \t\t\t Net assets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 669.9 \t\t\t \t\t\t \t\t\t 792.3 \t\t\t \t\t \t\t \t\t\t \t\t\t Equity \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Share capital \t\t\t \t\t\t \t\t\t 8 \t\t\t \t\t\t \t\t\t 31.6 \t\t\t \t\t\t \t\t\t 33.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Share premium account \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 177.1 \t\t\t \t\t\t \t\t\t 177.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Own shares \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (11.1) \t\t\t \t\t\t \t\t\t (15.6) \t\t\t \t\t \t\t \t\t\t \t\t\t Capital redemption reserve \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 131.3 \t\t\t \t\t\t \t\t\t 129.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Other reserves \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 10.0 \t\t\t \t\t\t \t\t\t 10.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Translation reserves \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 38.8 \t\t\t \t\t\t \t\t\t 52.3 \t\t\t \t\t \t\t \t\t\t \t\t\t Retained earnings \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 290.4 \t\t\t \t\t\t \t\t\t 404.0 \t\t\t \t\t \t\t \t\t\t \t\t\t Equity attributable to equity holders of the parent \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 668.1 \t\t\t \t\t\t \t\t\t 790.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Non-controlling interests \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 1.8 \t\t\t \t\t\t \t\t\t 1.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Total equity \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 669.9 \t\t\t \t\t\t \t\t\t 792.3 \t\t\t \t\t \t   Consolidated cash flow statement For the year ended 31 December 2024 \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Note \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Net cash from operating activities \t\t\t \t\t\t \t\t\t 11 \t\t\t \t\t\t \t\t\t 152.6 \t\t\t \t\t\t \t\t\t 191.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Investing activities \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Purchases of property, plant and equipment \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (70.1) \t\t\t \t\t\t \t\t\t (74.1) \t\t\t \t\t \t\t \t\t\t \t\t\t Proceeds on disposal of property, plant and equipment \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 13.4 \t\t\t \t\t\t \t\t\t 10.4 \t\t\t \t\t \t\t \t\t\t \t\t\t Purchases of other intangible assets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (4.1) \t\t\t \t\t\t \t\t\t (8.3) \t\t\t \t\t \t\t \t\t\t \t\t\t Acquisition of businesses, net of cash acquired \t\t\t \t\t\t \t\t\t 10 \t\t\t \t\t\t \t\t\t (52.2) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Net proceeds on disposal of business \t\t\t \t\t\t \t\t\t 3 \t\t\t \t\t\t \t\t\t 0.4 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Loans issued \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (1.0) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Interest received \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 0.8 \t\t\t \t\t\t \t\t\t 0.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Net cash used in investing activities \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (112.8) \t\t\t \t\t\t \t\t\t (71.2) \t\t\t \t\t \t\t \t\t\t \t\t\t Financing activities \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Interest paid \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (9.7) \t\t\t \t\t\t \t\t\t (7.2) \t\t\t \t\t \t\t \t\t\t \t\t\t Dividends paid \t\t\t \t\t\t \t\t\t 9 \t\t\t \t\t\t \t\t\t (42.9) \t\t\t \t\t\t \t\t\t (40.6) \t\t\t \t\t \t\t \t\t\t \t\t\t Principal elements of lease payments \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (13.5) \t\t\t \t\t\t \t\t\t (13.1) \t\t\t \t\t \t\t \t\t\t \t\t\t Drawdown of bank loans \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 75.2 \t\t\t \t\t\t \t\t\t 25.7 \t\t\t \t\t \t\t \t\t\t \t\t\t Repayments of bank loans \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (19.0) \t\t\t \t\t\t \t\t\t (61.8) \t\t\t \t\t \t\t \t\t\t \t\t\t Ordinary shares purchased for share buyback \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (57.7) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Own shares purchased to be held as treasury shares \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (13.2) \t\t\t \t\t \t\t \t\t\t \t\t\t Net cash used in financing activities \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (67.6) \t\t\t \t\t\t \t\t\t (110.2) \t\t\t \t\t \t\t \t\t\t \t\t\t Net (decrease)/increase in cash and cash equivalents \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (27.8) \t\t\t \t\t\t \t\t\t 10.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Cash and cash equivalents at beginning of year \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 44.7 \t\t\t \t\t\t \t\t\t 36.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Effect of foreign exchange rate changes \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (0.9) \t\t\t \t\t\t \t\t\t (1.7) \t\t\t \t\t \t\t \t\t\t \t\t\t Cash and cash equivalents at end of year \t\t\t \t\t\t \t\t\t 11 \t\t\t \t\t\t \t\t\t 16.0 \t\t\t \t\t\t \t\t\t 44.7 \t\t\t \t\t \t     Consolidated statement of changes in equity For the year ended 31 December 2024 \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Share capital \t\t\t \t\t\t \t\t\t Share premium account \t\t\t \t\t\t \t\t\t Own shares \t\t\t \t\t\t \t\t\t Capital redemption reserve \t\t\t \t\t\t \t\t\t Other reserves \t\t\t \t\t\t \t\t\t Translation reserves \t\t\t \t\t\t \t\t\t Retained earnings \t\t\t \t\t\t \t\t\t Equity attributable to equity holders of the parent \t\t\t \t\t\t \t\t\t Non-controlling interests \t\t\t \t\t\t \t\t\t Total equity \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t 1 January 2023 \t\t\t \t\t\t \t\t\t 33.1 \t\t\t \t\t\t \t\t\t 177.1 \t\t\t \t\t\t \t\t\t (5.2) \t\t\t \t\t\t \t\t\t 129.8 \t\t\t \t\t\t \t\t\t 5.1 \t\t\t \t\t\t \t\t\t 81.2 \t\t\t \t\t\t \t\t\t 359.8 \t\t\t \t\t\t \t\t\t 780.9 \t\t\t \t\t\t \t\t\t 1.1 \t\t\t \t\t\t \t\t\t 782.0 \t\t\t \t\t \t\t \t\t\t \t\t\t Profit for the year \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 85.6 \t\t\t \t\t\t \t\t\t 85.6 \t\t\t \t\t\t \t\t\t 1.2 \t\t\t \t\t\t \t\t\t 86.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Exchange differences on translation of overseas operations \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (28.9) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (28.9) \t\t\t \t\t\t \t\t\t (0.8) \t\t\t \t\t\t \t\t\t (29.7) \t\t\t \t\t \t\t \t\t\t \t\t\t Movements on hedges of net investments \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 1.5 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 1.5 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 1.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Movements on cash flow hedges \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 0.4 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 0.4 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 0.4 \t\t\t \t\t \t\t \t\t\t \t\t\t Actuarial gains on defined benefit pension schemes net of deferred tax \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t \t\t \t\t\t \t\t\t Total comprehensive income for the year \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 1.9 \t\t\t \t\t\t \t\t\t (28.9) \t\t\t \t\t\t \t\t\t 85.5 \t\t\t \t\t\t \t\t\t 58.5 \t\t\t \t\t\t \t\t\t 0.4 \t\t\t \t\t\t \t\t\t 58.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Ordinary shares acquired \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (13.2) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (13.2) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (13.2) \t\t\t \t\t \t\t \t\t\t \t\t\t Settlement of share awards \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 2.8 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (2.0) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (0.8) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Share-based payments \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 5.1 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 5.1 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 5.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Deferred tax on share-based payment transactions \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 0.1 \t\t\t \t\t\t \t\t\t 0.1 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 0.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Dividends \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (40.6) \t\t\t \t\t\t \t\t\t (40.6) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (40.6) \t\t\t \t\t \t\t \t\t\t \t\t\t 31 December 2023 \t\t\t \t\t\t \t\t\t 33.1 \t\t\t \t\t\t \t\t\t 177.1 \t\t\t \t\t\t \t\t\t (15.6) \t\t\t \t\t\t \t\t\t 129.8 \t\t\t \t\t\t \t\t\t 10.1 \t\t\t \t\t\t \t\t\t 52.3 \t\t\t \t\t\t \t\t\t 404.0 \t\t\t \t\t\t \t\t\t 790.8 \t\t\t \t\t\t \t\t\t 1.5 \t\t\t \t\t\t \t\t\t 792.3 \t\t\t \t\t \t\t \t\t\t \t\t\t Profit for the year \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 20.0 \t\t\t \t\t\t \t\t\t 20.0 \t\t\t \t\t\t \t\t\t 0.7 \t\t\t \t\t\t \t\t\t 20.7 \t\t\t \t\t \t\t \t\t\t \t\t\t Exchange differences on translation of overseas operations \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (13.5) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (13.5) \t\t\t \t\t\t \t\t\t (0.3) \t\t\t \t\t\t \t\t\t (13.8) \t\t\t \t\t \t\t \t\t\t \t\t\t Movements on hedges of net investments \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 4.1 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 4.1 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 4.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Movements on cash flow hedges \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t \t\t \t\t\t \t\t\t Actuarial losses on defined benefit pension schemes net of deferred tax \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (0.4) \t\t\t \t\t\t \t\t\t (0.4) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (0.4) \t\t\t \t\t \t\t \t\t\t \t\t\t Total comprehensive income for the year \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 4.0 \t\t\t \t\t\t \t\t\t (13.5) \t\t\t \t\t\t \t\t\t 19.6 \t\t\t \t\t\t \t\t\t 10.1 \t\t\t \t\t\t \t\t\t 0.4 \t\t\t \t\t\t \t\t\t 10.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Ordinary shares acquired \t\t\t \t\t\t \t\t\t (1.5) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 1.5 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (90.6) \t\t\t \t\t\t \t\t\t (90.6) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (90.6) \t\t\t \t\t \t\t \t\t\t \t\t\t Settlement of share awards \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 4.5 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (4.7) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 0.2 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Share-based payments \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 0.6 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 0.6 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 0.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Dividends \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (42.8) \t\t\t \t\t\t \t\t\t (42.8) \t\t\t \t\t\t \t\t\t (0.1) \t\t\t \t\t\t \t\t\t (42.9) \t\t\t \t\t \t\t \t\t\t \t\t\t 31 December 2024 \t\t\t \t\t\t \t\t\t 31.6 \t\t\t \t\t\t \t\t\t 177.1 \t\t\t \t\t\t \t\t\t (11.1) \t\t\t \t\t\t \t\t\t 131.3 \t\t\t \t\t\t \t\t\t 10.0 \t\t\t \t\t\t \t\t\t 38.8 \t\t\t \t\t\t \t\t\t 290.4 \t\t\t \t\t\t \t\t\t 668.1 \t\t\t \t\t\t \t\t\t 1.8 \t\t\t \t\t\t \t\t\t 669.9 \t\t\t \t\t \t   Other reserves include a share-based payments reserve of £5.5m (31 December 2023: £9.7m).     The capital redemption reserve of £131.3m consists of £129.8m transferred from retained earnings on the conversion of B shares into deferred shares in 2008 and 2009 and £1.5m arising on the share buyback programmes announced in January 2024 and December 2024. As at 31 December 2024 8,558,676 shares with a nominal value of 17 3 / 11 p had been repurchased under the share buyback programmes which were announced in January 2024 (and commenced in March 2024) and December 2024 (to commence in 2025), for a total consideration of £57.7m (including costs £0.4m). A liability of £32.9m has been recognised relating to the Group’s remaining contractual commitment to buy shares under the share buyback programmes as at 31 December 2024. Refer to note 8 of these condensed consolidated financial statements for more information.   The own shares reserve represents the cost of shares in Bodycote plc purchased in the market and held by the Bodycote International Employee Benefit Trust to satisfy share-based payments under the Group’s incentive schemes. As at 31 December 2024, 1,627,781 (31 December 2023: 2,292,243) ordinary shares of 17 3 / 11 p   each were held by the Bodycote International Employee Benefit Trust. Notes to the condensed consolidated financial statements Year ended 31 December 2024   General information Bodycote plc is a company incorporated in the United Kingdom under the Companies Act 2006. The nature of the Group’s operations and its principal activities, and information on the Group’s objectives, are included within the Group’s Strategic report in the 2024 Annual report.   Items included in the financial statements of each entity in the Group are measured using the currency of the primary economic environment in which the entity operates. The condensed consolidated financial statements are presented in pounds sterling, which is the functional and presentation currency of the Parent Company. Foreign operations are included in accordance with the policies set out in the Foreign Currencies accounting policy in the 2024 Annual report. Basis of Preparation and non-statutory financial statements The financial statements of the Group, from which these condensed consolidated financial statements are derived, have been prepared in accordance with UK-adopted international accounting standards as applied in accordance with the provisions of the Companies Act 2006. The financial information set out above does not constitute the Company's statutory accounts for the years ended 31 December 2024 or 2023 but is derived from those accounts. Statutory accounts for 2023 have been delivered to the Registrar of Companies and those for 2024 will be delivered following the Company's Annual General Meeting. The auditor has reported on those accounts; their reports were unqualified, did not draw attention to any matters by way of emphasis and did not contain statements under s.498 (2) or (3) of the Companies Act 2006.   1.   Business and geographical segments The Group has 153 operational locations across the world providing a range of market sectors with thermal processing services. After the completion of a strategic review during 2024, the Group has reorganised its plants into three divisions: \t Specialist Technologies: This division includes the Group’s Hot Isostatic Pressing (‘HIP’) business; its Speciality Stainless Steel Processes (S3P) business and its Surface Technology business. \t Precision Heat Treatment: This division includes the Group’s business centred on the controlled heating and cooling of metals to obtain the desired mechanical, chemical and metallurgical properties for the end process. It also includes the Group’s Low Pressure Carburising and Corr-I-Dur processes.   \t Non-core: As a result of its strategic review carried out in 2024, the business identified a number of plants that form part of its strategic optimisation programme and are considered non-core. These plants typically provide heat treatments services using older, less efficient and more carbon intensive technologies. The Group is managing these sites with a view to merging them with other plants in the portfolio, closing plants, or selling them over the coming 24 months.   The Group’s Chief Executive Officer is considered to be the Chief Operating Decision Maker (‘CODM’) of the Group and reviews the results of each of the divisions on a monthly basis focussing on adjusted operating profit which is defined as operating profit before acquisition costs, amortisation of acquired intangibles and exceptional items. Accordingly, the three divisions outlined above are considered to be the Group’s Operating and Reportable segments as defined in IFRS 8 Operating Segments.   In determining the segments’ adjusted operating profit, the Group makes certain allocations of costs that are incurred centrally to benefit each of the segments. To the extent that these costs are of a nature that will continue to be incurred after the Group’s optimisation programme has been completed, they have not been allocated to the non-core segment.   Prior to the strategic review in 2024, the business presented its results split into six Operating Segments which were determined based on the geography of its plants and the preponderance of markets that they served. The prior year segmental analysis has been restated to present it on a consistent basis with the current year.   \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Specialist Technologies \t\t\t \t\t\t \t\t\t Precision Heat Treatment \t\t\t \t\t\t \t\t\t Central costs and eliminations \t\t\t \t\t\t \t\t\t Total core \t\t\t \t\t\t \t\t\t Non-core \t\t\t \t\t\t \t\t\t Total Group \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t 224.2 \t\t\t \t\t\t \t\t\t 488.3 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 712.5 \t\t\t \t\t\t \t\t\t 44.6 \t\t\t \t\t\t \t\t\t 757.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Result \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Adjusted operating profit/(loss) \t\t\t \t\t\t \t\t\t 65.0 \t\t\t \t\t\t \t\t\t 83.0 \t\t\t \t\t\t \t\t\t (20.4) \t\t\t \t\t\t \t\t\t 127.6 \t\t\t \t\t\t \t\t\t 1.4 \t\t\t \t\t\t \t\t\t 129.0 \t\t\t \t\t \t\t \t\t\t \t\t\t Amortisation of acquired intangible assets \t\t\t \t\t\t \t\t\t (8.7) \t\t\t \t\t\t \t\t\t (1.3) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (10.0) \t\t\t \t\t\t \t\t\t (0.4) \t\t\t \t\t\t \t\t\t (10.4) \t\t\t \t\t \t\t \t\t\t \t\t\t Acquisition costs \t\t\t \t\t\t \t\t\t (2.4) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (2.4) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (2.4) \t\t\t \t\t \t\t \t\t\t \t\t\t Operating profit/(loss) before exceptional items \t\t\t \t\t\t \t\t\t 53.9 \t\t\t \t\t\t \t\t\t 81.7 \t\t\t \t\t\t \t\t\t (20.4) \t\t\t \t\t\t \t\t\t 115.2 \t\t\t \t\t\t \t\t\t 1.0 \t\t\t \t\t\t \t\t\t 116.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Exceptional items \t\t\t \t\t\t \t\t\t (2.1) \t\t\t \t\t\t \t\t\t (21.7) \t\t\t \t\t\t \t\t\t (30.7) \t\t\t \t\t\t \t\t\t (54.5) \t\t\t \t\t\t \t\t\t (23.8) \t\t\t \t\t\t \t\t\t (78.3) \t\t\t \t\t \t\t \t\t\t \t\t\t Operating profit/(loss) \t\t\t \t\t\t \t\t\t 51.8 \t\t\t \t\t\t \t\t\t 60.0 \t\t\t \t\t\t \t\t\t (51.1) \t\t\t \t\t\t \t\t\t 60.7 \t\t\t \t\t\t \t\t\t (22.8) \t\t\t \t\t\t \t\t\t 37.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Finance income \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 0.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Finance charges \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (10.3) \t\t\t \t\t \t\t \t\t\t \t\t\t Profit before taxation \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 28.4 \t\t\t \t\t \t\t \t\t\t \t\t\t Taxation \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (7.7) \t\t\t \t\t \t\t \t\t\t \t\t\t Profit for the year \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 20.7 \t\t\t \t\t \t   \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Specialist Technologies \t\t\t \t\t\t \t\t\t Precision Heat Treatment \t\t\t \t\t\t \t\t\t Central costs and eliminations \t\t\t \t\t\t \t\t\t Total core \t\t\t \t\t\t \t\t\t Non-core \t\t\t \t\t\t \t\t\t Total Group \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t 212.4 \t\t\t \t\t\t \t\t\t 534.9 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 747.3 \t\t\t \t\t\t \t\t\t 55.2 \t\t\t \t\t\t \t\t\t 802.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Result \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t Adjusted operating profit/(loss) \t\t\t \t\t\t \t\t\t 55.2 \t\t\t \t\t\t \t\t\t 94.4 \t\t\t \t\t\t \t\t\t (24.8) \t\t\t \t\t\t \t\t\t 124.8 \t\t\t \t\t\t \t\t\t 2.8 \t\t\t \t\t\t \t\t\t 127.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Amortisation of acquired intangible assets \t\t\t \t\t\t \t\t\t (6.4) \t\t\t \t\t\t \t\t\t (1.3) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (7.7) \t\t\t \t\t\t \t\t\t (0.4) \t\t\t \t\t\t \t\t\t (8.1) \t\t\t \t\t \t\t \t\t\t \t\t\t Acquisition costs \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (0.3) \t\t\t \t\t\t \t\t\t (0.3) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t (0.3) \t\t\t \t\t \t\t \t\t\t \t\t\t Operating profit/(loss) \t\t\t \t\t\t \t\t\t 48.8 \t\t\t \t\t\t \t\t\t 93.1 \t\t\t \t\t\t \t\t\t (25.1) \t\t\t \t\t\t \t\t\t 116.8 \t\t\t \t\t\t \t\t\t 2.4 \t\t\t \t\t\t \t\t\t 119.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Finance income \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 0.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Finance charges \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (8.3) \t\t\t \t\t \t\t \t\t\t \t\t\t Profit before taxation \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 111.7 \t\t\t \t\t \t\t \t\t\t \t\t\t Taxation \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t (24.9) \t\t\t \t\t \t\t \t\t\t \t\t\t Profit for the year \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 86.8 \t\t\t \t\t \t   Inter-segment revenues are not material in either year. The Group does not have any one customer that contributes more than 10% of revenue in either year. \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Specialist Technologies \t\t\t \t\t\t \t\t\t Precision Heat Treatment \t\t\t \t\t\t \t\t\t Total core \t\t\t \t\t\t \t\t\t Non-core \t\t\t \t\t\t \t\t\t Total Group \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t \t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Western Europe \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 121.0 \t\t\t \t\t\t \t\t\t 239.3 \t\t\t \t\t\t \t\t\t 360.3 \t\t\t \t\t\t \t\t\t 20.8 \t\t\t \t\t\t \t\t\t 381.1 \t\t\t \t\t \t\t \t\t\t \t\t\t North America \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 95.7 \t\t\t \t\t\t \t\t\t 165.0 \t\t\t \t\t\t \t\t\t 260.7 \t\t\t \t\t\t \t\t\t 23.8 \t\t\t \t\t\t \t\t\t 284.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Emerging Markets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 7.5 \t\t\t \t\t\t \t\t\t 84.0 \t\t\t \t\t\t \t\t\t 91.5 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 91.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Group \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 224.2 \t\t\t \t\t\t \t\t\t 488.3 \t\t\t \t\t\t \t\t\t 712.5 \t\t\t \t\t\t \t\t\t 44.6 \t\t\t \t\t\t \t\t\t 757.1 \t\t\t \t\t \t     \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Specialist Technologies \t\t\t \t\t\t \t\t\t Precision Heat Treatment \t\t\t \t\t\t \t\t\t Total core \t\t\t \t\t\t \t\t\t Non-core \t\t\t \t\t\t \t\t\t Total Group \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t \t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Western Europe \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 120.9 \t\t\t \t\t\t \t\t\t 271.7 \t\t\t \t\t\t \t\t\t 392.6 \t\t\t \t\t\t \t\t\t 24.9 \t\t\t \t\t\t \t\t\t 417.5 \t\t\t \t\t \t\t \t\t\t \t\t\t North America \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 83.9 \t\t\t \t\t\t \t\t\t 173.2 \t\t\t \t\t\t \t\t\t 257.1 \t\t\t \t\t\t \t\t\t 30.3 \t\t\t \t\t\t \t\t\t 287.4 \t\t\t \t\t \t\t \t\t\t \t\t\t Emerging Markets \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 7.6 \t\t\t \t\t\t \t\t\t 90.0 \t\t\t \t\t\t \t\t\t 97.6 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 97.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Group \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 212.4 \t\t\t \t\t\t \t\t\t 534.9 \t\t\t \t\t\t \t\t\t 747.3 \t\t\t \t\t\t \t\t\t 55.2 \t\t\t \t\t\t \t\t\t 802.5 \t\t\t \t\t \t   Other information \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Specialist Technologies \t\t\t \t\t\t \t\t\t Precision Heat Treatment \t\t\t \t\t\t \t\t\t Central costs and eliminations \t\t\t \t\t\t \t\t\t Total core \t\t\t \t\t\t \t\t\t Non-core \t\t\t \t\t\t \t\t\t Total Group \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Gross capital additions \t\t\t \t\t\t \t\t\t 18.9 \t\t\t \t\t\t \t\t\t 61.4 \t\t\t \t\t\t \t\t\t 5.2 \t\t\t \t\t\t \t\t\t 85.5 \t\t\t \t\t\t \t\t\t 4.5 \t\t\t \t\t\t \t\t\t 90.0 \t\t\t \t\t \t\t \t\t\t \t\t\t Depreciation and amortisation \t\t\t \t\t\t \t\t\t 24.2 \t\t\t \t\t\t \t\t\t 51.3 \t\t\t \t\t\t \t\t\t 3.8 \t\t\t \t\t\t \t\t\t 79.3 \t\t\t \t\t\t \t\t\t 6.4 \t\t\t \t\t\t \t\t\t 85.7 \t\t\t \t\t \t\t \t\t\t \t\t\t Impairments \t\t\t \t\t\t \t\t\t 1.5 \t\t\t \t\t\t \t\t\t 20.7 \t\t\t \t\t\t \t\t\t 28.4 \t\t\t \t\t\t \t\t\t 50.6 \t\t\t \t\t\t \t\t\t 14.7 \t\t\t \t\t\t \t\t\t 65.3 \t\t\t \t\t \t   \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t Specialist Technologies \t\t\t \t\t\t \t\t\t Precision Heat Treatment \t\t\t \t\t\t \t\t\t Central costs and eliminations \t\t\t \t\t\t \t\t\t Total core \t\t\t \t\t\t \t\t\t Non-core \t\t\t \t\t\t \t\t\t Total Group \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Gross capital additions \t\t\t \t\t\t \t\t\t 19.9 \t\t\t \t\t\t \t\t\t 59.9 \t\t\t \t\t\t \t\t\t 10.0 \t\t\t \t\t\t \t\t\t 89.8 \t\t\t \t\t\t \t\t\t 4.7 \t\t\t \t\t\t \t\t\t 94.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Depreciation and amortisation \t\t\t \t\t\t \t\t\t 21.5 \t\t\t \t\t\t \t\t\t 50.7 \t\t\t \t\t\t \t\t\t 3.1 \t\t\t \t\t\t \t\t\t 75.3 \t\t\t \t\t\t \t\t\t 6.8 \t\t\t \t\t\t \t\t\t 82.1 \t\t\t \t\t \t\t \t\t\t \t\t\t Impairments \t\t\t \t\t\t \t\t\t 0.3 \t\t\t \t\t\t \t\t\t 0.5 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t\t \t\t\t 0.8 \t\t\t \t\t\t \t\t\t 0.1 \t\t\t \t\t\t \t\t\t 0.9 \t\t\t \t\t \t   Geographical information The Group’s revenue from external customers analysed by country in which the service is delivered is detailed below: \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t USA \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 271.2 \t\t\t \t\t\t \t\t\t 271.7 \t\t\t \t\t \t\t \t\t\t \t\t\t France \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 104.2 \t\t\t \t\t\t \t\t\t 116.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Germany \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 72.3 \t\t\t \t\t\t \t\t\t 82.3 \t\t\t \t\t \t\t \t\t\t \t\t\t UK \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 68.5 \t\t\t \t\t\t \t\t\t 66.3 \t\t\t \t\t \t\t \t\t\t \t\t\t Sweden \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 50.3 \t\t\t \t\t\t \t\t\t 50.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Netherlands \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 29.5 \t\t\t \t\t\t \t\t\t 34.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Others \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 161.1 \t\t\t \t\t\t \t\t\t 179.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Group \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 757.1 \t\t\t \t\t\t \t\t\t 802.5 \t\t\t \t\t \t   2. Operating profit \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Revenue \t\t\t \t\t\t \t\t\t 757.1 \t\t\t \t\t\t \t\t\t 802.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Cost of sales \t\t\t \t\t\t \t\t\t (460.4) \t\t\t \t\t\t \t\t\t (500.6) \t\t\t \t\t \t\t \t\t\t \t\t\t Gross profit \t\t\t \t\t\t \t\t\t 296.7 \t\t\t \t\t\t \t\t\t 301.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Selling costs \t\t\t \t\t\t \t\t\t (22.3) \t\t\t \t\t\t \t\t\t (21.8) \t\t\t \t\t \t\t \t\t\t \t\t\t Administration expenses \t\t\t \t\t\t \t\t\t (165.1) \t\t\t \t\t\t \t\t\t (172.0) \t\t\t \t\t \t\t \t\t\t \t\t\t Other operating income \t\t\t \t\t\t \t\t\t 9.7 \t\t\t \t\t\t \t\t\t 12.6 \t\t\t \t\t \t\t \t\t\t \t\t\t Other operating expenses \t\t\t \t\t\t \t\t\t (0.4) \t\t\t \t\t\t \t\t\t (1.3) \t\t\t \t\t \t\t \t\t\t \t\t\t Net impairment losses on financial assets \t\t\t \t\t\t \t\t\t (2.4) \t\t\t \t\t\t \t\t\t (0.2) \t\t\t \t\t \t\t \t\t\t \t\t\t Operating profit before exceptional items \t\t\t \t\t\t \t\t\t 116.2 \t\t\t \t\t\t \t\t\t 119.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Exceptional items (see note 3) \t\t\t \t\t\t \t\t\t (78.3) \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Operating profit \t\t\t \t\t\t \t\t\t 37.9 \t\t\t \t\t\t \t\t\t 119.2 \t\t\t \t\t \t   Operating profit for the year has been arrived at after charging/(crediting): \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Net foreign exchange (gain)/loss \t\t\t \t\t\t \t\t\t (0.4) \t\t\t \t\t\t \t\t\t 0.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Employee costs 1 \t\t\t \t\t\t \t\t\t 297.3 \t\t\t \t\t\t \t\t\t 307.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Pension scheme administration expenses \t\t\t \t\t\t \t\t\t 0.6 \t\t\t \t\t\t \t\t\t 0.5 \t\t\t \t\t \t\t \t\t\t \t\t\t Inventory expensed \t\t\t \t\t\t \t\t\t 70.5 \t\t\t \t\t\t \t\t\t 76.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Utility costs \t\t\t \t\t\t \t\t\t 68.8 \t\t\t \t\t\t \t\t\t 98.3 \t\t\t \t\t \t\t \t\t\t \t\t\t Consumables and gases \t\t\t \t\t\t \t\t\t 52.6 \t\t\t \t\t\t \t\t\t 55.3 \t\t\t \t\t \t\t \t\t\t \t\t\t Transport and carriage costs \t\t\t \t\t\t \t\t\t 12.4 \t\t\t \t\t\t \t\t\t 12.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Depreciation of property, plant and equipment \t\t\t \t\t\t \t\t\t 59.7 \t\t\t \t\t\t \t\t\t 59.4 \t\t\t \t\t \t\t \t\t\t \t\t\t Depreciation of right-of-use assets \t\t\t \t\t\t \t\t\t 13.6 \t\t\t \t\t\t \t\t\t 12.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Amortisation of other intangible assets \t\t\t \t\t\t \t\t\t 12.4 \t\t\t \t\t\t \t\t\t 9.8 \t\t\t \t\t \t\t \t\t\t \t\t\t Gain on disposal of property, plant and equipment recognised in operating profit \t\t\t \t\t\t \t\t\t (5.5) \t\t\t \t\t\t \t\t\t (3.4) \t\t\t \t\t \t\t \t\t\t \t\t\t Loss on disposal of property, plant and equipment recognised in exceptional items (see note 3) \t\t\t \t\t\t \t\t\t 0.1 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Gain on disposal of right-of-use assets \t\t\t \t\t\t \t\t\t (0.2) \t\t\t \t\t\t \t\t\t (0.2) \t\t\t \t\t \t\t \t\t\t \t\t\t Impairment loss on trade receivables \t\t\t \t\t\t \t\t\t 2.4 \t\t\t \t\t\t \t\t\t 0.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Impairment of other intangible assets recognised in exceptional items (see note 3 ) \t\t\t \t\t\t \t\t\t 29.2 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Impairment of goodwill recognised in exceptional items (see notes 3 & 6) \t\t\t \t\t\t \t\t\t 18.0 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Impairment of property, plant and equipment recognised in exceptional items (see note 3) \t\t\t \t\t\t \t\t\t 16.9 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Impairment of property, plant and equipment - recognised in operating profit \t\t\t \t\t\t \t\t\t 0.1 \t\t\t \t\t\t \t\t\t 0.9 \t\t\t \t\t \t\t \t\t\t \t\t\t Impairment of right-of-use assets recognised in exceptional items (see note 3) \t\t\t \t\t\t \t\t\t 1.1 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Repairs and maintenance \t\t\t \t\t\t \t\t\t 25.5 \t\t\t \t\t\t \t\t\t 27.2 \t\t\t \t\t \t\t \t\t\t \t\t\t Government assistance support received 2 \t\t\t \t\t\t \t\t\t (1.0) \t\t\t \t\t\t \t\t\t (6.4) \t\t\t \t\t \t\t \t\t\t \t\t\t Acquisition costs \t\t\t \t\t\t \t\t\t 2.4 \t\t\t \t\t\t \t\t\t 0.3 \t\t\t \t\t \t 1   Employee cost include costs of temporary agency contractors of £16.7m (2023: £17.3m). 2   Government assistance consists of support towards R&D of £0.4m (2023: £0.2m); local regional economic support of £0.4m (2023: £nil); energy support programmes £0.1m (2023: £6.1m); and £0.1m in respect of other support programmes.   3 . Exceptional items The following items were charged to exceptional items: \t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t 2024 \t\t\t \t\t\t \t\t\t 2023 \t\t\t \t\t \t\t \t\t\t \t\t\t   \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t\t \t\t\t £m \t\t\t \t\t \t\t \t\t\t \t\t\t Impairment of ERP intangible asset \t\t\t \t\t\t \t\t\t 28.4 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Impairment of goodwill \t\t\t \t\t\t \t\t\t 18.0 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t Strategic optimisation programme: \t\t\t \t\t\t \t\t\t 31.9 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t\t \t\t\t \t\t\t    Impairment of assets \t\t\t \t\t\t \t\t\t 18.8 \t\t\t \t\t\t \t\t\t   \t\t\t \t\t \t\t \t\t\t \t\t\t    Severance and redundancy cost \t\t\t \t\t\t \t\t\t 4.1 \t\t\t \t\t\t \t\t\t - \t\t\t \t\t \t...

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