ACCELERATING
INCHCAPE’S
TRANSFORMATION
During 2024, Inchcape accelerated its
transformation as the leading independent
automotive Distributor globally.
This was achieved through the sale of the
UK Retail business and a record number of
Distribution contract wins with OEM partners.
Supported by a refreshed strategic
approach, Accelerate+, we will drive
further scale and diversification across our
global business, as we look to deliver sustainable
growth for our OEM partners and shareholders,
and exceptional experiences for our customers.
FIND OUT MORE
Strategic report
2
2024 snapshot
4
Driving our ambition
6
Chairman's statement
8
Group Chief Executive's statement
11
Business model
14
How we create value
16
Our Opportunity
17
Trends evolving our strategy
18
Our strategic framework
23
Operating and financial review
30
KPIs
32
Sustainability
35
Task force on climate-related financial disclosures
51
Non-financial and sustainability information
52
Risk management
Governance
62
Chairman’s statement
63
Governance at a glance
65
Division of responsibilities
66
Board of Directors
69
Group Executive team
71
Board evaluation
72
Board activities and decisions
77
Stakeholder engagement
78
Nomination Committee report
81
Audit Committee report
89
Sustainability Committee report
91
Directors' report on remuneration
107 Compliance with the 2018 UK Corporate
Governance Code
111 Director's report
Financial statements
116 Auditor report
125 Consolidated income statement
126 Consolidated statement of comprehensive income
127 Consolidated statement of financial position
128 Consolidated statement of changes in equity
130 Consolidated statement of cash flows
131 Accounting policies
142 Notes to the financial statement
211 Shareholder Information
Inchcape Annual Report and Accounts 2024
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1
OUR STRATEGY
Accelerate+, our refreshed
strategic approach, is enhancing
our position as the leading
automotive Distributor globally.
OUR BUSINESS
MODEL
We partner with OEMs to unlock
opportunity using our in-market
expertise and advanced digital
and data capabilities, helping to
deliver sustainable growth.
SUSTAINABILITY
Sustainability is at the centre of our
strategy and Inchcape has a
leading role in ensuring a global
mobility transition that is inclusive
and long-lasting. Our goal is to
create a future where sustainable
mobility is available for all.
READ MORE P18
READ MORE P11
READ MORE P32
FINANCIAL
£9.3bn
Revenue
(2023: £9.4bn²)
£462m
Free cash flow1
(2023: £492m2)
6.3%
Adjusted operating margin1
(2023: 6.6%2)
27%
Return on capital
employed1
(2023: 27%2)
£444m
Profit before tax and
adjusting items1
(2023: £467m2)
NON-FINANCIAL
2.3%
Battery electric vehicles sold
(2023: 1.0%2)
761
Reputation.com score
(2023: 702)
37%
Reduction in scope
1 and 2 greenhouse
gas emissions4
28%
Women in Senior
Leadership positions3
(2023: 26%2)
STATUTORY FINANCIAL MEASURES
£562m
Operating Profit
(2023: £570m2)
£414m
Profit before tax
(continuing operations)
(2023: £378m2)
£435m
Total profit/(loss)
for the period
(2023: £283m2)
£586m
Net cash generated from
operating activities
(2023: £593m2)
1. APM (alternative performance measure), see page 190.
2. Represented for UK Retail disposal.
3. Includes the Group Executive Team and its direct reports, see page 69.
4. Reduction against 2019 revised baseline.
OUR FINANCIAL METRICS
Metric
£m
Use of metric
Gross Profit
1,606 Direct profit contribution from Value
Drivers (e.g. Vehicles and Aftersales)
Add back: Adjusting items charged to gross
profit
—
Adjusted Gross Profit from continuing
operations
1,606
Direct profit contribution from Value
Drivers (e.g. Vehicles and Aftersales)
Less: Segment operating expenses
(1,022)
Adjusted Operating Profit from continuing
operations
584 Operating profit generated by the
Group after operating expenses
Less: Adjusting items in operating expenses
(22)
Operating Profit
562 Statutory measure of Operating Profit
Less: Net Finance Costs and JV profits/losses
(148)
Profit Before Tax
414 Statutory measure of profit after the
costs of financing the Group
Add: Total adjusting Items
30
Adjusted profit before tax from continuing
operations
444
Inchcape Annual Report and Accounts 2024
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2024 SNAPSHOT
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2
Number of Distribution OEM Partners
2024
2016
Annualised Distribution Revenues1
2024
2016
1. 2016 revenues represented for Distribution revenues only.
Reported revenues in 2016 were £7.8bn
Number of Distribution Markets
2024
2016
Distribution Volumes
2024
2016
UK Retail sale
The sale of our UK Retail business paved the
way for Inchcape to consolidate its position as
the world’s leading automotive Distributor. As a
Distributor we are capital-light, highly cash-
generative and deliver attractive returns
to shareholders.
READ MORE P73
Launch of Accelerate+
Our refreshed strategic approach launched this
year has been designed to scale and optimise
our business, as we continue to develop our
position as the leading independent global
automotive Distributor.
READ MORE P18
Distribution contract portfolio
We continue to diversify our global footprint
and extend our distribution contract portfolio.
In 2024, we won 22 new Distribution contracts
in our Regions and we now have 230
Distribution contracts across the Group.
READ MORE P20
Sustainability
This year we published our first Sustainability
Report: The Global Mobility Transition, Delivered
Locally. It sets out the progress we have made
in achieving our sustainability targets and our
enhanced role supporting the mobility
transition.
READ MORE P32
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2024 SNAPSHOT CONTINUED
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3
THE TRANSFORMATION
OF INCHCAPE
2016 to today
68
20
£9.3bn
£3.4bn
340k
150k
38
23
THE INCHCAPE INVESTMENT CASE
STRATEGIC DRIVERS OF GROWTH: SCALE AND OPTIMISE
Powered by Accelerate+, Inchcape is the leading independent global automotive distributor with long-term partnerships supported by our highly differentiated technology. Our capital-light
model ensures resilient margins, healthy free cash flow generation, and delivering high returns. With a solid financial profile, we invest in growth by expanding OEM partnerships, securing new
Distribution contracts, and executing value-accretive acquisitions. By consistently leveraging these growth opportunities, we will continue to deliver a balance and disciplined capital allocation
policy, driving value and returns for shareholders.
THE LEADING GLOBAL AUTOMOTIVE
DISTRIBUTOR
• Long-term, diversified OEM portfolio
• Targeting lower-scale and more
complex markets
• Deep competitive moat
through technology
• Scaled geographic footprint
WITH AN
ATTRACTIVE
FINANCIAL PROFILE
• Growth driven by market
outperformance
• Resilient operating margins
• Highly cash generative
• Capital efficient and high ROCE
DRIVING SHAREHOLDER VALUE
• Clear dividend policy
• Commitment to on-going
share buybacks
• Value-accretive acquisitions
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OUR INVESTMENT CASE – DRIVING OUR AMBITION
Inchcape.com
4
KEY VALUE DRIVERS
Market outperformance
3%-5% organic
volume CAGR
Resilient operating
margins
c.6%
Cash generative model
c.100% FCF:PAT
DRIVING RETURNS
AND GROWTH:
2.5bn
(£) Free Cash Flow
DISCIPLINED
CAPITAL ALLOCATION:
Dividends
40%
of EPS
On-going share
buybacks and
value-accretive
acquisitions
DELIVERING
SHAREHOLDER VALUE:
>10%
EPS CAGR
+ dividends
Underpinned by
consistently high ROCE
25% - 30%
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OUR INVESTMENT CASE – DRIVING OUR AMBITION CONTINUED
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5
OUR MEDIUM TERM GROWTH AMBITION: 2025 – 2030
A CLEAR GROWTH ROADMAP TO DELIVERING
SHAREHOLDER VALUE, THROUGH-THE-CYCLE
Over the medium term from FY 2025 to
FY 2030, the Group will continue to
deliver value for shareholders, supported
by its growth drivers, resilient margins,
highly cash generative business model
and a disciplined approach to capital
allocation. This will enable us to deliver
value and returns for shareholders by
delivering over 10% EPS CAGR.
Dear Shareholders and Stakeholders,
It was a privilege to have been appointed as Chair of
Inchcape plc, in May 2024, at such an exciting stage in the
Group’s prestigious journey.
Given Inchcape’s future prospects, and based on our highly
compelling growth strategy, I am looking forward to
continuing to lead the Group’s high-calibre and diverse
Board, as we support our exceptional executive
management team, to deliver value for all stakeholders.
Substantial strategic progress
2024 was a transformational year for Inchcape, as we
became leading global automotive Distributor,following the
disposal of our UK retail business. Automotive Distribution is
capital-light and highly cash generative, and Inchcape
remains the world’s leading independent player in
this segment.
To further develop our global leadership position, in 2024 we
evolved our strategic approach. Accelerate+ will drive our
business into the most attractive markets, with the best mix of
OEM partners, maximising volumes and continuing to deliver
a market-leading service for them and their customers.
The Accelerate+ strategy is all about growth. The renewed
single focus on automotive distribution will drive our organic
growth strategy based on leveraging market share and
market mix, combined with new contract wins, and
accelerated by bolt-on acquisitions. We are focused on
delivering strong profitable revenue growth powered by
strong local market expertise ensuring we are in the best
position to support all our OEM partners.
The Group Executive Team led the successful execution of
strategy during the year highlighted by the disposal of our
UK Retail business, the on-going integration of our recently
acquired businesses and a record year for Distribution
contract wins. The continued delivery of Accelerate+ will
drive future value for our OEM partners, our shareholders and
other key stakeholders.
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CHAIRMAN'S STATEMENT
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6
A YEAR OF
STRATEGIC
PROGRESS
Bringing mobility for the world’s
communities, for today, for
tomorrow and for the better.
Jerry Buhlmann
Chairman
Our continued focus on a sustainable future
Inchcape’s role in sustainability is to support a mobility
transition that is inclusive and long-lasting, while shaping a
future where sustainable mobility is available for everyone.
Accelerate+ is underpinned by our approach to
Sustainability, and our sustainability activities are supported
by three key ambitions:
• to deliver insights for the benefit of OEMs, consumers,
governments and policymakers to help accelerate the
transition to more sustainable mobility, by applying our
global perspective and our understanding of local markets;
• to enable a faster transition to new technologies,
particularly with New Energy Vehicles, by enhancing how
we support OEMs with their transition plans; and
• to ensure we play our part, by remaining a highly
sustainable independent distribution channel for OEMs.
More information on our approach and progress on key
Sustainability areas can be found on pages 32 to 34. We will
also be publishing our second Sustainability Report later in
the year.
“SUPPORTED BY OUR
DIFFERENTIATED
TECHNOLOGY
CAPABILITIES,
INCHCAPE REMAINS
WELL PLACED FOR
THE FUTURE”
Board changes during the year
We further strengthened the Board in 2024, with the
appointment of Alison Platt. Alison joined the Board as a non-
executive director in January and was appointed Senior
Independent Director in May 2024.
Alison brings a wealth of experience across a variety of
industries, including healthcare, insurance and property, as
well as many years experience at a board level. In addition,
her previous membership of the steering group of the
Hampton-Alexander Review will provide valuable insights on
inclusion and diversity.
Also during the year, Nigel Stein stood down from the Board,
having been our Chair since 2018 and a member of the
Board since 2015. I would like to thank Nigel for his
outstanding leadership of the Board. During this time he built
a diverse board, consisting of directors with a breadth of
knowledge, skills and experience from a wide range of
sectors and industries, and developed a highly collaborative
and inclusive culture.
Jane Kingston, a non-executive director and previous Chair
of the Remuneration Committee, also retired from the Board
during the year, having joined the Board in 2018, Byron Grote
became Chair of the Remuneration Committee following
Jane’s retirement. I would like to thank Jane for her
commitment and contribution during her tenure.
I would also like to thank my colleagues on the Board for their
continued support and valuable input during 2024.
Our high-performance culture is a differentiator
Inchcape’s culture will be a key enabler of Accelerate+ and
we continue to make good progress in building our culture
across the Group, particularly at our recently acquired
businesses, where local teams continue to implement
comprehensive integration programmes to ensure the
Inchcape culture is fully embedded across our regions.
The Board remains proactive in embracing the Group's
culture and engaging with the business. Now that the Group
no longer has UK operations, the Board is holding two
meetings overseas providing additional opportunities for Non-
Executive Directors to engage further with the business.
Bringing the Board closer to the business continues to
enhance the effectiveness of the Board’s oversight of culture.
An updated capital allocation policy
We have updated our capital allocation policy, which is
supported by our strong balance sheet, and is focussed on
three priority areas.
Firstly, our dividend policy is to pay out 40% of adjusted basic
EPS in annual dividend payment to shareholders. Secondly,
we are committed to on-going share buybacks. Thirdly, we
will continue to target value-accretive acquisitions.
Based on this policy, and considering the Group’s resilient
performance in 2024, the Board recommends that the
Company continues to pay a dividend of 40% of annual
adjusted EPS. This payment would result in an overall
dividend payment of 28.5p.
In addition, following the completion of a £150m share
buyback during the first quarter of 2025, we announced a
new share buyback programme of £250m in March 2025,
which is expected to complete over the next 11 months.
Inchcape remains well placed for future growth
Driven by our global market leadership position as an
automotive Distributor, and supported by our evolved
strategic approach, Inchcape remains well placed for the
future. This was evidenced by our strong performance in
2024, which demonstrated the resilience, scale and
diversification of Inchcape’s global business, the quality of
our Group Executive Team and the high calibre of our
people around the world.
Looking ahead, the Group will continue to deliver value for
shareholders, supported by its key growth drivers, resilient
margins, highly cash generative business model and a
disciplined approach to capital allocation. To that end, from
FY 2025 to FY 2030, the Group expects to generate £2.5 billion
in free cash flow, which it will deploy to deliver shareholder
value through >10% EPS CAGR.
Finally, on behalf of the Board, I would like to thank
Inchcape’s team of around 18,000 colleagues worldwide for
their commitment and hard work in delivering strong results
for Inchcape’s stakeholders. The commitment and
excellence of colleagues in every market give me great
confidence for further growth and future success.
Jerry Buhlmann
Chairman
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CHAIRMAN'S STATEMENT CONTINUED
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7
Can you give an overview of Inchcape’s
investment proposition?
Inchcape is the leading independent global provider of an
essential function in the global automotive industry –
Distribution. OEMs award us with the exclusive rights to
distribute their vehicles and parts, in smaller, more complex
and high-growth markets. Our business is characterised by
long-term relationships with our OEM partners, which are
supported by our differentiated technology capabilities and
the dedication of our highly talented people.
Our business model drives our strong financial profile – which
is capital-light, with resilient margins and healthy free cash
flow generation, helping us to deliver high returns. This
financial profile ensures we can invest in significant growth
opportunities, helping us to deliver a disciplined capital
allocation policy, as our Chair, Jerry Buhlmann, outlines on
page 6.
Why have you launched an evolved strategic
approach with Accelerate+?
Since 2021, when we launched our original Accelerate
strategy, the external environment has evolved. This has
been characterised by higher inflation and interest rates
impacting consumer confidence in certain markets, the
transition to a pure Electric Vehicle (EV) world taking longer
than anticipated, increasing demands from OEMs for greater
efficiencies and continued developments in technology.
Against this background, Inchcape has remained agile,
adapting to ensure we deliver for our partners and
customers. To that end, Accelerate+ has been developed to
enhance Inchcape’s position as the leading global
automotive Distributor.
Accelerate+ is a strategic evolution, which has been designed
to drive scale in new and existing markets. This is through
acquisitions and contract wins, and optimising our global
operations through Distribution Excellence and Value-Added
Services, to deliver sustainable and profitable growth. Value-
Added Services include our opportunity to grow in parts and
Finance & Insurance (F&I), and to support the new energy
vehicle transition.
This evolved strategic approach will enable us to drive
towards our ambition of growing towards 10% market share
in our markets over the medium to long-term.
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GROUP CHIEF EXECUTIVE'S STATEMENT
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8
ACCELERATING
TRANSFORMATION
TOGETHER
Duncan Tait
Group Chief Executive
Why is driving market share in your markets so
important for Inchcape?
Delivering on our 10% market share ambition will drive
substantial benefits for Inchcape and our stakeholders. These
benefits include:
• sustainable growth over time, for Inchcape and our OEMs;
• scale our business in each market, to leverage our
platform and drive efficiencies;
• top line growth, as we work with an expanding range of
brands in a market; and
• increased operating leverage and stronger margins, by
driving more brands through our operating cost base.
Furthermore, we have a major opportunity to scale in around
70 markets around the world, within our Total Addressable
Market of 10.8m vehicles, as outlined on page 16.
In the context of Accelerate+, what were
Inchcape’s key strategic achievements in 2024 and
how does this position the Group for the future?
We delivered strategic progress in 2024, and with the disposal
of our UK retail business, the Group consolidated its position
as the the world’s leading automotive Distributor.
Furthermore, and to help further develop our diversified and
scaled footprint, we won 22 new Distribution contracts during
the year, taking our total Distribution contract wins since 2021
to over 40. In 2024, these included two in Australia, in
Adjacent Vehicle Categories - Deepal, a Changan brand in
the SUV segment, and Foton, a light commercial vehicle
brand. The pick-up truck segment makes up around 25% of
the total industry volume (TIV) in Australia - this represents a
major new market segment for Inchcape.
In addition, we won 14 contracts in the Americas, including
premium motorcycle brand of Harley-Davidson in Chile,
Peugeot in the Caribbean and Great Wall Motors in
Colombia, and 6 contracts in Europe & Africa, including Ford
in Estonia and BYD in Ethiopia. In addition, as the Group
scales and grows, we aim to ensure we have an optimal
portfolio of brands which is best suited to our business and
our markets. To that end, we conduct a limited level of
portfolio rationalisation, to help us optimise our market
presence and leverage our infrastructure in the most
efficient way.
In FY 2024, we mutually agreed to exit 4 immaterial and
dilutive Distribution contracts with certain OEM partners. We
expect this dynamic to continue in future years, as we
manage our contract portfolio, to ensure we drive value for
both Inchcape and for our OEM partners.
In summary, given our continued momentum on Distribution
contract wins, the continued optimisation of our contract
portfolio, as well as our successful integration of recently
completed acquisitions and a healthy pipeline of bolt-on
acquisitions, Inchcape is well placed to further consolidate our
position as the world’s leading automotive Distributor.
Can you give an overview of Inchcape’s
performance during 2024?
Inchcape delivered resilient operational and financial
performance from continuing operations in 2024, with
revenue growth of 4%, in constant currency, reflecting the
underlying strength, scale and diversification of our business.
This delivered adjusted operating profit of £584m, operating
margins of 6.3% and free cash flow conversion of 151%.
Our performance in 2024 was driven by consistent
operational execution from our teams around the world, who
continue to impress me with their hard work, enthusiasm and
total commitment to Inchcape, in their pursuit of delivering
growth for our OEM partners.
Can you discuss Inchcape’s regional performance
in 2024 and how you see these trends developing
in the future?
Our regions continued to evolve at different rates, with a mix
of supply and demand trends, across our 38 markets, which
highlights the benefits of scale and diversification to
our business.
In the Americas, we delivered a robust performance across
the region, including an improved performance in the
second half.
In APAC, we delivered growth in line with the market, with
growth from acquisitions and resilient margins.
Europe & Africa produced an excellent performance,,
supported by an order bank unwind in certain markets in
Europe. We achieved record market share in Europe, with 6
contract wins during the year. Africa, despite currency
devaluation in Ethiopia, was stable and revenues were resilient.
Looking ahead, what is Inchcape’s role in the
transition to a New Energy world?
Overall, it is important to say that we remain drive-train
agnostic for our OEM partners, whilst at the same time
playing a key role in supporting them to transition to new
energy vehicles over the long-term.
The move to pure EVs is taking longer than expected, with
hybrid drive trains expected to be relevant for longer than
expected. This is positive for Inchcape, given our relationship
with OEMs who have market-leading hybrid product portfolios.
Furthermore, our markets remain underweight on EV, with
different markets requiring different solutions across varying
timescales, so the transition to a New Energy world is likely to
take longer than the transition in more scaled and
developed automotive markets.
In the meantime, car parcs, which is the total number of
vehicles on the road, continue to grow across our markets,
and the majority of these vehicles continue to be internal
combustion engine (ICE). Inchcape will continue to play a
critical role here, as the distributor of OEM parts in our markets,
further emphasising our drive-train agnostic approach.
“INCHCAPE
DELIVERED A
RESILIENT
OPERATIONAL
AND FINANCIAL
PERFORMANCE
IN 2024”
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9
Can you discuss Inchcape’s M&A track record and
future plans in this area?
We have delivered good momentum on acquisitions in
recent years, with seven deals executed and integrated
since 2021, generating approximately £3 billion in
incremental revenue.
M&A delivers strategic benefits for the Group, as
demonstrated by our acquisition of Derco in 2022. That
transaction has helped to drive our market share across the
Americas, and underpinned our success in winning contracts
with new OEM partners, many of which were previous
Derco relationships.
Looking ahead, we will continue to target bolt-on
acquisitions, in the context of an industry which remains
highly fragmented, with c. 1,000 independent distributors in
our markets around the world. We remain disciplined and we
aim to ensure the acquisitions we make are value-accretive.
In addition, our acquisition approach is fully aligned to our
focus on capital-light Distribution businesses in our markets.
How has the Group developed its technology
capabilities during 2024?
As a result of our ongoing investment in technology,
Inchcape has developed a market-leading approach in the
use of technology and data to support our OEM partners,
which have transformed the experience we provide to
end customers.
We have developed a ‘plug and play’ model with DXP
(Digital Experience Platform) and DAP (Data Analytics
Platform) which provide us with insight and analytics that
helps us to make smarter decisions and provide customers
with an enhanced and more tailored experience. In 2024,
we rolled out DXP and DAP into more markets with more
OEMs. In addition, we utilised new technologies, like Artificial
Intelligence (AI) to drive efficiencies across our business, for
example in the development of an AI-based forecasting
algorithm for parts which helps to ensure our OEMs’ parts are
competitively priced across our Distribution channels.
Can you talk about developments on your
approach to sustainability during the year?
Our approach to sustainability is fully embedded into
Accelerate+. We remain focused on bringing mobility to the
communities in which we operate, to deliver economic
benefits and social inclusion in those communities.
As an independent distributor, our role is focused on the
global mobility transition delivered locally, based on
delivering insights, enabling new technologies and by
providing the most sustainable route-to-market, across our
four key pillars of People, Planet, Places and Practices.
You can find more details on our Sustainability approach and
progress in 2024 on pages 32 to 34.
What is your message to Inchcape’s people,
following our performance in 2024?
Inchcape is the world’s leading automotive Distribution
business and we have grown through organic growth,
significant momentum in new Distribution contracts from our
OEM partners and through acquisitions. The strategic
development of our business is a testament to the
professionalism, calibre and dedication of our colleagues
and I am very grateful for their continued hard work, energy
and commitment during 2024.
I would also like to thank the Group Executive Team for their
continued valuable contribution and outstanding leadership.
In addition, I am grateful to two of our Global Executive Team
members who left the business during the year – George
Ashford and Mark Dearnley. They both played critical roles in
the growth and development of Inchcape in recent years,
and we wish them all the very best for the future.
How do you see the future for Inchcape?
The future for Inchcape is very exciting. Winning more
Distribution contracts and executing value-accretive bolt-on
acquisitions will help us to reach our 10% market share
ambition over the medium to long-term.
From FY 2025 to FY 2030, the Group expects to generate £2.5
billion in free cash flow, which we will deploy to drive >10%
EPS growth. This will be achieved by delivering on our key
value drivers, through-the-cycle, including organic volume
growth of 3% to 5%, resilient margins of c.6%, FCF:PAT
conversion of 100%, underpinned by ROCE of 25% to 30%. We
deliver shareholder value through a disciplined approach to
capita allocation.
Delivering on this growth algorithm will help us to capitalise
on the differentiated platform we have built, establishing a
stronger, more scaled Inchcape, in more markets with our
OEMs generating sustainable, profitable growth and value
over time.
Duncan Tait
Group Chief Executive
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GROUP CHIEF EXECUTIVE'S STATEMENT CONTINUED
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10
YEAR IN REVIEW
Supported by my GET colleagues
and wider team, this year I had
the opportunity to meet OEMs,
other strategic partners and
colleagues in markets in every
region Inchcape operates in.
WHAT WE DO
Our Distribution Excellence approach connects
the products of OEM partners with customers, by
leveraging our capabilities across our value chain.
Inchcape often partners with OEMs in smaller, more complex and harder to reach markets,
which tend to be higher growth with lower motorisation rates.
Broadly we have two commercial models. The first where we leverage third party dealers. As a
Distributor, we take responsibility for a brand in a given market. This means managing vehicles
and parts on behalf of an OEM from the factory gate or port, and then taking care of every
part of the value chain, from logistics to sales to end users. The second is vertical integration,
where we operate across the entire Distribution value chain, owning and directly operating the
dealerships in that market.We also provide Value Added Services for customers throughout the
lifecycle of a vehicle.
01
Product planning
We use our local market
expertise to inform certification
and vehicle ordering decisions,
around elements like model
types and specification.
04
Channel management
We recommend the optimal
channels to reach consumers
and businesses covering
network management, digital,
and omni-channel and
including the selection and
management of independent
third party-dealers,
where appropriate.
02
Logistics
We deliver vehicles and
parts to markets in each of
our regions.
05
Digital retail
We bring our omni-channel
platform to customers to deliver
world-class, digital-first
experiences for consumers
through DXP, our Digital
Experience Platform.
03
Brand and marketing
We work on brand proposition
development and positioning,
price setting and marketing,
maximising market share for
our partners.
06
Value Added Services
This includes the exclusive
distribution of vehicle parts,
maintenance, finance and
insurance, new energy vehicles
and used cars.
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OUR BUSINESS MODEL
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Our value chain
WHO WE PARTNER WITH
OEM relationships
Our globally-scaled, diversified and prestigious
portfolio is unrivalled across the automotive
Distribution industry.
Our portfolio of more than 60 OEM partners come from all over the world including Japan,
Europe, China and the USA. The illustration below highlights the breadth, depth and duration
of these relationships.
This speaks to the longevity of our Distribution model and the quality of our partnerships with
OEMs. We have worked with a number of our market-leading Japanese brands, including
Toyota and Lexus for over 50 years, with Porsche and Suzuki for over 35 years
and BMW and Subaru for over 25 years.
LONG-STANDING OEM RELATIONSHIPS
RECENT OEM RELATIONSHIPS
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WHERE WE OPERATE
Inchcape’s geographic reach has been driven
by a deep understanding of OEM partners and
customers. This is coupled with our global
expertise and local Market knowledge.
We understand our Markets through our digital-led approach, using data analytics and business
intelligence to grow market share in our regions.
With our robust Sustainability Framework and aim to offer the most sustainable route-to-market,
we focus on delivering market share for OEM partners, so they can focus on operating in the
major markets and the mobility transition.
AMERICAS
EUROPE & AFRICA
ASIA PACIFIC (APAC)
Argentina
Costa Rica
Panama
Belgium
Latvia
Poland
Brunei
Macau
Thailand
Barbados
Ecuador
Peru
Bulgaria
Lithuania
Romania
Guam
Philippines
Australia
Bolivia
El Salvador
Uruguay
Estonia
Luxembourg
Djibouti
Hong Kong
Saipan
New Zealand
Chile
Guatemala
Finland
North
Macedonia
Ethiopia
Indonesia
Singapore
Colombia
Honduras
Greece
Kenya
£3.3bn
Revenue
(13)%
13
Markets
£3.0bn
Revenue
+7%
14
Markets
£3.0bn
Revenue
+6%
11
Markets
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HOW WE
CREATE VALUE
Inchcape’s success is dependent
on the continued trust and
support of all its stakeholders.
Strong relationships are
fundamental to the long-term
success of the Group.
OEM PARTNERS
We provide OEM partners with professional
and efficient routes to market throughout the
post-factory automotive value chain,
supported by market-leading Digital, Data
and Analytics.
Interests
• Strategy
• Sustainability
• Trusted partnership
• Brand protection
• Health, safety, and
environment (HSE)
• Environment, social, and
governance (ESG)
2024 highlights
• Consolidating our
position as world’s
leading automotive
Distributor
• Continued investment in
Digital, Data & Analytics
• Supported expansion of
Distribution into new
Markets and vehicle
categories
CUSTOMERS
We provide access to vehicle ownership as
well as parts and services throughout the
customer journey and vehicle lifecycle.
Customers are served through a tailored
omnichannel experience.
Interests
• Access to a range of
quality vehicles from
world-renowned brands
• Tailored omnichannel
experiences
• Specialist product and
service knowledge
• Aftersales services and
parts
• Finance & Insurance
2024 highlights
• Customer omnichannel
platform is live in 32
markets for 33 OEM
brands (2023: 17
markets, 15 OEM
partners)
• Reputation.com: 126,000
reviews from 1,010
locations. 761 average
rating from customers
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COLLEAGUES
We support our colleagues to achieve their
personal goals and foster a culture based
on inclusion, empowerment and optimised
potential through learning.
Interests
• Strategy
• Long-term sustainability
• Security of employment
• Inclusion & Diversity (I&D)
• Health & Safety
• Company purpose
and values
2024 highlights
• Internal launch campaign
for Accelerate+
• 150+ women participated
in the Aspire development
programme
• 90% response rate to
‘Be Heard’ colleague
survey
• 1,000+ colleagues
trained in inclusive
hiring practices
SHAREHOLDERS
We aim to deliver value on long-term
investment based on a sustainable platform for
growth, disciplined approach to capital
allocation and cash returns through dividends
and share buybacks.
Interests
• Strategy
• Purpose and values
• Financial performance
and strength of balance
sheet
• Capital allocation
• Sustainability
• Long-term commercial
sustainability and
business viability
• Key developments in the
business and issues we
are facing
2024 highlights
• Refreshed strategic
approach, Accelerate+,
to support long-term
growth
• £150m share buyback
programme
• Two investor webinars
and c.170 shareholder
meetings
COMMUNITIES
We have a balanced approach to
engagement with the communities in which
we operate, empowering ownership at local
level with structural support from the Group.
Interests
• Local employment
• Sustainability, including
local environmental issues
like waste disposal
• Health & Safety
• Community activities
• Local road safety
campaigns
• Responsible approach
to local law and
regulations
2024 highlights
• Expansion of our Road
Safety Programme into
New Zealand
• Partnerships across all
Regions focusing on
accessible mobility
solutions
• Built our Women
Mechanics Training
Programme in Uruguay,
with planned expansion
across the Americas.
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OUR OPPORTUNITY
FOR GROWTH
A substantial Total Addressable Market
with significant growth opportunities
for Inchcape.
Our Total Addressable Market (TAM) are markets typically characterised by high GDP growth, low motorisation
rates, more complex and is estimated to be around 10.8 million vehicles sold annually. We have a market share
of only 3% of this TAM, emphasising our opportunity for growth. The chart below brings this to life, showing that if
we were to reach our 10% market share ambition over the long term, we would treble the size of our business.
OPPORTUNITY FOR FURTHER GROWTH AND OUTPERFORMANCE
Our Total Addressable Market (TAM) and potential to scale
TAM: 10.8m, ~£325bn
OUR SCALE OPPORTUNITY
25 markets
where we have <10% share
44 markets
new potential markets
Inchcape Share Ambition: 10%
Revenue: ~£32bn
Inchcape
Share: 3%
Revenue:
~£9.7bn
~3x
Group size
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OUR OPPORTUNITY
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Achieving this ambition, with a scaled
and diversified OEM portfolio across our
markets, will drive:
Sustainable performance over time, for
Inchcape, our OEMs and shareholders;
Scale in a market, which brings benefits in
areas like procurement efficiencies;
Top line growth, as we work with an expanding
range of brands in a given market;
Increased operating leverage and stronger
margins, by driving more brands through our
operating cost base;
New revenue opportunities, as OEMs look to
launch new product offerings, by leveraging
our share in a market.
THE AUTOMOTIVE INDUSTRY
AND THE ECONOMIES WE
OPERATE IN ARE EVOLVING
MACROECONOMIC
CONDITIONS
NEV TRANSITION
OEM – INCREASING
DRIVE FOR EFFICIENCY
EVOLVING OEM LANDSCAPE
SUSTAINABILITY:
INCREASING IMPORTANCE
TO PARTNERS
Global economic conditions
have changed. Higher inflation
and interest rates in many
markets puts more pressure on
OEMs, so there is more emphasis
on the need for Inchcape to
continue to deliver for them.
The uptake of Electric Vehicles
(EVs) and New Energy Vehicles
(NEVs) is taking longer than
anticipated three years ago,
with hybrid drive trains
becoming increasingly relevant.
OEMs are looking for partners
who can provide greater
efficiencies including cost
enhanced Distribution
capabilities.
We have seen a rapidly-evolving
OEM landscape, including the
emergence of new OEMs
seeking growth in our Markets.
OEMs are looking for partners to
support their sustainability
agendas including the transition
to NEVs and providing the most
sustainable route-to-market.
…AND SO HAS INCHCAPE…
5 acquisitions and over 40
contract wins since 2021
Entered
new markets
New OEM
relationships
Developed new capabilities
Sustainability
Framework
We have scaled our business
model and diversified our
mobility company partner
portfolio, proving resilient in
turbulent times.
Our geographically-diverse
footprint, operating across an
additional 3 markets since 2021,
means we are well-placed to
navigate the current
macroeconomic climate.
We provide mobility company
partners with a solution in lower
volume and high-growth
potential emerging markets.
Since 2016 we have added over
45 brands to our portfolio across
various drive trains.
We have developed innovative
solutions, collaborating bringing
value to consumers and mobility
company partners. Our digital
and data capabilities mean we
better understand consumers
and cater to their needs,
optimising their experience.
We have a solid Sustainability
Framework, focusing on
delivering insights to our
stakeholders, enabling new
technologies to accelerate the
adoption of NEVs and provide
the most sustainable route-to-
market for OEM partners.
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TRENDS EVOLVING OUR STRATEGY
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Accelerate+ enhances our position as the world’s leading
automotive Distributor, so we can continue to be a brilliant partner for
OEMs and deliver exceptional experiences for customers.
PASSENGER
CARS
ADJACENT VEHICLE
CATEGORIES
DISTRIBUTION
EXCELLENCE
VALUE ADDED
SERVICES
Our success in delivering Accelerate+ will be achieved with enablers from throughout our business
CULTURE &
CAPABILITIES
DIGITAL, DATA
& ANALYTICS
OEM
RELATIONSHIPS
M&A &
INTEGRATION
Developing a culture to
attract and retain talent and
capabilities to deliver
Accelerate+. A culture built
on fresh thinking and
collaboration.
Continuing investment in
technological capabilities to
stay ahead of the curve so we
can deliver outstanding
experiences for customers and
growth for our OEM partners.
Developing an even deeper
understanding of the global
OEM landscape so we can
continue to develop and
provide an outstanding value
proposition to our OEM partners.
Ensuring acquisitions take place
in line with a disciplined
approach to capital allocation
and improving the way we
integrate the business we
acquire.
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OUR STRATEGIC FRAMEWORK
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18
READ MORE ABOUT OUR ENHANCED APPROACH TO SUSTAINABILITY AND HOW IT UNDERPINS OUR EVOLVED STRATEGY P32
READ MORE P19
READ MORE P21
Scale enables us to grow our
market share in passenger cars
in both existing and new
markets and deliver growth
through extending our
distribution capabilities into
Adjacent Vehicle Categories.
We will drive scale in three ways – through organic
growth, through winning new OEM contracts and
through value-accretive acquisitions in attractive
markets.
Scale will be achieved in two key areas:
PASSENGER CARS
We aim to drive growth in passenger cars in
new and existing markets as Accelerate+
delivers Scale. Of the 38 markets we are
present in today, there are 25 markets where
we are below 10% market share.
ADJACENT VEHICLES CATEGORIES
Scale will ensure we achieve further growth by
extending our Distribution capabilities into
Adjacent Vehicle Categories. In particular, we
aim to grow in the commercial vehicle and
premium motorcycle categories where we
already operate in a several markets.
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HOW WE ARE
DRIVING SCALE…
Record number of contract wins
We continue to drive organic growth expansion through new
contracts with existing OEMs in new markets and new OEMs
in existing markets.
In 2024 we signed a record 22 new contracts in the year.
These contract wins were with 13 OEM brands across 12
markets throughout our three regions. 6 of the OEMs are
new to our portfolio demonstrating our ability to build new
relationships and demonstrating our value proposition
to OEMs.
Exciting new contract additions:
M&A and integration
Inchcape’s focus on building and maintaining close and
long-standing OEM partnerships provides the foundation for
our ability to execute strategic and accretive growth
through acquisition.
Inchcape has accelerated industry consolidation since
focusing on Distribution expansion in 2016, during with time,
we have developed a plug and play distribution platform.
This will support scale acquisitions and important bolt-on
deals, adding new partnerships, markets, and significant
revenue to the business, while optimising our Retail footprint
through select disposals. Our ambition is for Inchcape to
become the distribution partner of choice for automotive
manufacturers. Key factors in achieving this include: our
track record of successful acquisition integration; investment
in technology and digital capabilities that can be deployed
at scale; our people’s capabilities and approach to retaining
key management; and the firepower we have available to
execute deals through a strong balance sheet and
disciplined approach to capital allocation.
OUR M&A FRAMEWORK:
Strategic
•
Additive to existing brand footprint
•
Broadens geographic reach
•
Enhanced by Inchcape’s distribution platform
Financial
•
Focus on markets with higher growth prospects
•
Take a considered approach to valuing targets
•
ROIC > project WACC targeted in Year 3
Organisational
•
Focus on retaining and nurturing talent
•
Responsible business framework
•
Opportunity to professionalise processes
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OUR STRATEGY
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Rebalancing our portfolio in favour of distribution since 2016
56
16
13
Distribution contracts won
since 2016
New markets and 48 new
OEMs brands since 2016
M&A deals since 2016 with
c.£4bn of annualised
revenue added
Optimise ensures Inchcape
continues to be the most
efficient and effective
Distribution partner for OEMs.
It will be driven by the next generation of our
Distribution Excellence programme and Value Added
Services ensuring we achieve our goal of delivering the
best customer experiences to drive customer satisfaction
and lifetime profitability.
DISTRIBUTION EXCELLENCE
Evolving our approach to Distribution Excellence
means we will continue being a brilliant partner
for OEMs. Accelerate+ ensures we will maximise
the value of the key platforms and capabilities
delivering outstanding results for stakeholders.
For OEMs, this means driving efficiency throughout
the route-to-market, for example, by optimising the
management of our Retail network.
For customers, it means continuing to transform
their omnichannel experience. They will have a
consistent, reliable and personalised service 24/7,
that’s driven by AI (Artificial Intelligence) across all
channels, throughout our retail network. This will
drive customer satisfaction, boost our reputation
scores and increase the value we create with
each customer.
VALUE ADDED SERVICES
The goal of Value Added Services (VAS) is to
increase value per customer, throughout the
lifecycle of a vehicle, using our expertise and scale
as a Distributor to do so.
We will deliver this in four key ways:
• Leveraging our platforms to capitalise on the
Parts market as part of a comprehensive
aftersales offer.
• Expanding our F&I offer.
• Developing opportunities in the NEV segment, like
charging infrastructure for EVs.
• Developing our used car business by leveraging
our Distribution platform.
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HOW WE ARE
OPTIMISING OUR BUSINESS…
Optimising through Value Added Services
The Digital Parts Platform (DPP) is Inchcape’s innovative e-
commerce solution that transforms the distribution of genuine
parts by digitising the buying process. It provides registered
users with seamless access to real-time stock information,
detailed catalogues, and streamlined ordering and tracking,
thereby enhancing the experience for customers, OEM
partners, and dealer networks.
Piloted in Australia, the platform has delivered impressive
results, including double-digit growth in purchase value and
significantly higher customer retention. Building on this
success, we are expanding DPP to more OEMs in Australia
and new markets across APAC, with recent rollouts in Hong
Kong and Singapore, and planned launches in the
Philippines and Indonesia.
Optimising through Distribution Excellence
DXP (Digital Experience Platform) and DAP (Data Analytics
Platform) are Inchcape’s in-house digital solutions designed
to enhance customer engagement and drive smarter
business decisions.
DXP is an omnichannel platform and provides OEM partners
with valuable data-driven insights to optimise sales and
customer experiences. The platform is live in 32 markets for 33
OEMs. DAP leverages advanced analytics and AI to support
decision-making across the automotive distribution value
chain. These platforms are highly scalable and a key
differentiator for our OEM partners.
For example, in Hong Kong and Singapore, we successfully
launched DXP with two OEM brands through our owned
retail networks. This led to a significant increase in the
conversion of digital leads to sales, with online vehicle
purchases tripling and customer reputation scores rising well
above industry averages.
CASE STUDY
LOCAL EXPERTISE
SUPPORTED BY
GLOBAL CAPABILITIES
AI ICY is an AI-powered body repair
quotation service offering a rapid
service, currently in Hong Kong. The
technology works as a 24/7 virtual
assistant and can provide a quote in five
minutes through a mobile chat service.
The tool also offers inspection and
maintenance options and a 24-hour
towing support service. The need for
manual checks has been replaced and
enhances the customer experience
beyond the buying journey.
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600+
41%
registered workshops in Australia on
the Digital Parts Platform
Sales contribution from digital
platforms in Hong Kong
22
Inchcape delivered strategic, operational and financial
progress in FY 2024, reflecting our diversified and scaled
global market leadership position, our long-standing and
valuable OEM relationships and our differentiated
technology capabilities.
We delivered against a range of operational and financial
metrics during the year, producing revenue and profit
growth and we reduced our leverage, enabling our
disciplined approach to capital allocation. This was
supported by strong operational performance in each of our
regions. In APAC, we delivered resilient margins, against
mixed market momentum, while in the Americas, our
business is well positioned for a market recovery. In Europe
and Africa, we outperformed against the market.
An evolved strategic approach – focused on scale
and optimise
During the year, we launched Accelerate+, designed to help
scale our organisation and optimise key elements of our
business Scale be achieved through executing and
integrating value-accretive acquisitions and by winning and
embedding new Distribution contracts with our OEM
partners. Since 2019, the Group has executed 8 acquisitions
and our bolt-on acquisition pipeline remains healthy in a
fragmented independent distribution landscape. In addition,
since FY 2021, we have won 40+ Distribution contracts, which
are expected to contribute, on an average per contract
basis at maturity, of between £20m and £30m in revenue
and between £1m and £2m in adjusted operating profit,
with an anticipated increase in market share of at least 2%.
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23
2024 WAS ANOTHER
YEAR OF PROGRESS
FOR INCHCAPE
A year of strategic, operational
and financial progress
Adrian Lewis
Group Chief Financial Officer
HIGHLIGHTS
Revenue
£9.3bn
2023: £9.4bn2
Free cash flow1
£462m
2023: £492m2
Adjusted operating
margin1
6.3%
2023: 6.6%2
Return on capital
employed1
27%
2023: 27%2
Profit before tax and
adjusting items1
£444m
2023: £467m2
Dividend per share
28.5p
2023: 33.9p
1. These measures are Alternative Performance Measures, see pages 190
to 193
2. Represented for UK Retail disposal
2024
2023
% change
reported
% change
constant FX2
% change
organic1
Key financials (continuing operations)
Revenue
£9,263m
£9,382m
(1) %
+4 %
+2 %
Adjusted Operating Profit2
£584m
£620m
(6) %
+2 %
Adjusted Operating Margin2
6.3 %
6.6 %
(30)bps
(20)bps
Adjusted Profit Before Tax2
£444m
£467m
(5) %
+5 %
Adjusted Basic EPS2
71.3p
76.3p
(7) %
Dividend Per Share
28.5p
33.9p
(16) %
Free Cash Flow2
£462m
£492m
(6) %
Reported financials
Operating Profit (continuing operations)
£562m
£570m
(1) %
Profit Before Tax (continuing operations)
£414m
£378m
+10 %
Total profit for the period
£435m
£283m
+54 %
Basic EPS (continuing operations)
66.4p
57.1p
+16 %
Net cash generated from operating activities
£586m
£593m
(1) %
We are optimising our business in a number of areas,
including through the divestment of non-core assets,
particularly retail-only businesses. Since 2019, we have
disposed of a number of non-core retail assets, generating
approximately £750m in net cash proceeds, including, in FY
2024, our UK retail business and a retail aftersales business in
the Americas. This has ensured that Inchcape is now fully
focused on Distribution, which is capital-light, more cash
generative, higher growth and higher margin than
retail-only businesses.
Financial performance and balance sheet in FY 2024
Our financial performance during the year highlights our
continued operational and strategic progress, ensuring we
are well positioned for the future. We generated revenue of
£9.3bn, up 4% in constant currency.
Operating margins were 6.3%, reflecting organic revenue
growth, with regional mix impacting gross margins, mostly
offset by continued cost discipline. Adjusted PBT was £444m,
which on a constant currency basis was 5% above the
prior year.
We delivered another excellent period of free-cash flow
generation, producing £462m. This drove a 151% (2023:150%)
free cash flow to profit after tax to conversion rate. Adjusted
net debt1 reduced to £190m, from £601m in the prior year,
with leverage improving to 0.3x, from 0.8x in 2023. This was
driven by a strong working capital performance and
proceeds from non-core asset retail disposals.
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Resilient short-term outlook, with share buyback of £250m
FY 2025 is expected to be another year of growth for
Inchcape, with product cycles and the ramp-up of contract
wins skewing growth to the second half of the year.
We expect to deliver higher EPS growth in FY 2025, driven by
profit growth and our disciplined approach to capital
allocation. As outlined in the letter by our Chair, Jerry
Buhlmann, Inchcape’s updated capital allocation policy is
focused on dividend payments at 40% of adjusted basic EPS,
with the Board declaring a final dividend of 17.2p for FY 2024,
a commitment to on-going share buybacks and value-
accretive acquisitions.
In March 2025, the Group initiated a new share buyback
programme of £250m. This follows the completion of the
Group’s most recent share buyback of £150m in Q1 2025.
Delivering shareholder value over the medium term
Over the medium term, the Group will continue to deliver
value for shareholders, supported by its organic growth
drivers, resilient margins, highly cash generative business
model and a disciplined approach to capital allocation.
From FY 2025 to FY 2030, the Group expects to generate
£2.5 billion in free cash flow, which it will deploy to deliver
shareholder value through >10% EPS CAGR, with a consistent
dividend policy. This will be achieved by the Group delivering
against its key value drivers, through-the-cycle – in particular:
• Organic volume CAGR of 3% to 5%;
• Resilient operating margins of c.6%;
• FCF: PAT conversion of c.100%.
This will be underpinned by consistently high levels of ROCE
of 25% to 30%.
We will continue to take a disciplined approach to capital
allocation, focused on dividends, a commitment to on-going
share buybacks and value-accretive acquisitions.
Inchcape’s medium term growth prospects will be supported
by our diversified and scaled global market leadership
position, with our long-standing and valuable OEM
relationships and our differentiated technology capabilities.
Adrian Lewis
Group Chief Financial Officer
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PERFORMANCE REVIEW
The Group delivered a resilient financial performance in 2024,
driven by strong top line growth, with resilient margins
supported by continued cost discipline across the Group.
Group revenue of £9.3bn, increased by 4% in constant
currency, supported by organic growth of 2% and a
contribution from acquisitions of 2%. This was offset by
translational currency headwinds of (5)%, which meant that
revenues were down (1)% on a reported basis.
The Group delivered adjusted operating profit2 of £584m up
2% in constant currency, offset by (8)% translational currency
headwinds. Resilient adjusted operating margins2 of 6.3%
were supported by cost discipline. Overheads were stable,
with the ratio of adjusted net operating expenses to revenue
of 11.0% (2023: 11.1%). Reported operating profit was down
(1)%.
Adjusted net finance costs2 reduced to £142m (2023: £154m),
driven by the positive impact of a reduction in average net
debt on net interest costs. This was partly offset by an increase
in inventory financing costs associated with a more stable
working capital profile, which resulted in an expense of £56m
(2023: £38m).
Adjusted profit before tax2 grew 5% on a constant currency
basis, offset by (10)% translational currency headwinds.
Adjusted basic EPS2 was down (7)% to 71.3p, also driven by
translational currency headwinds, as well as a higher
effective tax rate, partly offset by profit growth and the
impact of the share buyback programme, which delivered
1p EPS accretion.
During the year, pre-tax adjusting items amounted to an
expense of £30m (2023: £89m). This was primarily driven by
one-off costs related to acquisition and integration costs of
£42m (2023: £50m), mainly in relation to Derco, and non-
cash, non-operational losses arising from hyperinflation
accounting relating to Ethiopia of £8m (2023: £29m). These
factors were partly offset by a gain on disposal of a non-core
retail aftersales business in the Americas of £6m (2023: nil),
and non-cash, net impairment reversals of distribution
agreements of £14m (2023: nil). After adjusting items,
reported profit before tax was £414m (2023: £378m).
The highly cash-generative nature of our business model was
again highlighted during the year, with free cash flow2
generation of £462m (2023: £492m), representing a
conversion of profit after tax of 151% (2023: 150%). This was
supported by a net working capital inflow of £195m (2023:
inflow £169m) driven by strong inventory management and a
continued alignment of supplier terms at acquired
businesses. Inventory fell to £1,935m (FY 2023: £2,718m),
driven by the impact of translational FX, the disposal of the
UK Retail business, accounting for £336m of the reduction,
the disposal of a non-core retail aftersales business in the
Americas of £19m and an improvement in inventory
efficiency across the Group. Net interest payments in the
period increased to £128m (2023: £118m), excluding
payment for leases in both periods, due to the timing of cash
payments relating to inventory finance. Net cash generated
from operations down (1)% to £586m.
As at 31 December 2024, Group adjusted net debt2
amounted to £190m, a significant reduction from FY 2023
when net debt was £601m (excluding lease liabilities). This
was achieved due to a strong free cash flow performance of
£462m and net proceeds from non-core asset disposals of
£391m, set against cash outflows of £294m relating to
dividends and share buybacks, and £153m relating to FX and
other items. Including lease liabilities, the Group ended the
period with net debt of £492m (FY 2023: net debt of
£1,041m). Group leverage on a proforma basis1 was
approximately 0.3x at 31 December 2024, down from 0.8x at
the end of FY 2023.
Return on capital employed2 during the year was 27%, in line
with FY 2023 on a continuing operations basis, but higher than
previous years, highlighting the benefits of Inchcape becoming
an automotive Distribution business.
1. Proforma basis includes last twelve months of adjusted EBITDA including full
year impact of acquisitions
2. These measures are Alternative Performance Measures, see pages 190 to 193
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REGIONAL REVIEW
APAC (32% of revenue and 40% of adjusted operating profit) -
growth from acquisitions, resilient margins
Revenue grew 9% in constant currency, including flat organic
revenue growth, supported by a contribution from the
acquisitions made in FY 2023, the integration of which are on
track. Performance in the region was broadly in line with the
market, in the context of mixed market momentum. In the
second half, certain markets were weaker, with tough
comparators. Adjusted operating profit1 was up 6%, with
adjusted operating margins1 , down (30)bps to 7.8%
(excluding a £16m property disposal in FY 2023, operating
margins were up 30bps in FY 2024). For FY 2025, mixed market
momentum is expected to continue, with competitive
dynamics in certain markets, against tough comparators in H1
2025. Growth is expected to be H2-weighted in FY 2025, driven
by the timing of planned launches of key models and the
ramp-up of new contracts. Margins are expected to remain
resilient, supported by continued cost discipline.
Europe & Africa (33% of revenue and 24% of adjusted operating
profit) - strong growth and market outperformance
Revenue grew 11% in constant currency, driven by excellent
operational delivery across the region. Europe achieved a
record year in market share, with substantial progress made in
diversifying the region's OEM partner portfolio. Organic growth
in Europe normalised in H2 2024, reflecting the order bank
unwind in the region. Performance in Africa remained resilient.
Adjusted operating profit1 was up 15%, with continued
elevated adjusted operating margins1 of 4.7%. In H2 2024,
operating margins returned to historic levels, driven by the
effect of the order bank unwind, some dilution from the
acceleration of contract win momentum in Europe and the
translational currency impact relating to Ethiopia. For FY 2025,
lower revenue levels are expected, against tough
comparators, with operating margins expected to moderate
towards historic levels.
Americas (35% of revenue and 36% of adjusted operating profit)
- improved performance in H2 2024
Revenue fell (4)% in constant currency, with a robust
performance across the region, including positive organic
growth in H2 2024. The region delivered an excellent year in
Distribution contract wins, with 14 contract awards, driven by
the strength of Derco's relationships. Adjusted operating profit1
was down (9)%, with adjusted operating margins1 down (50)bps
from FY 2023 to 6.3%, with the deleveraging effect of reduced
market volumes, particularly in H1 2024, and an improved
operating margin exit rate in H2 2024 of 6.6%. This was driven by
better operating efficiency across the region, supported by
Derco cost synergies. For FY 2025, we have prudent
expectations for a strong market recovery, with the Group
expecting to continue delivering margin resilience. In addition,
the region's revenue will be impacted by the sale of a dilutive,
non-core retail aftersales business, and some owned-retail sites,
in FY 2024 (which generated annual revenue of c.£80m).
During the year, we generated 30% of gross profit through
Aftersales (FY 2023: 28%).
Distribution regional breakdown
Revenue
APAC
Europe & Africa
Americas
24
23
Adjusted operating profit1
APAC
Europe & Africa
Americas
24
23
Adjusted operating margin1
6.3%
2024
6.6%
2023
1. Operating profit and operating margin stated before adjusting items
Gross profit split
We provide disclosure on the split behind the Group’s
gross profit. This includes:
1.
Gross profit attributable to Vehicles: New Vehicles,
Used Vehicles and the associated income from F&I
products; and
2.
Gross profit attributable to Aftersales: Service
and Parts.
Vehicles
1,120
1,191
24
23
Aftersales
486
469
24
23
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OTHER FINANCIAL ITEMS
Adjusting items: During the year, pre-tax adjusting items
amounted to an expense of £30m (2023: £89m). This was
primarily driven by one-off costs related to acquisition and
integration costs of £42m (2023: £50m), mainly in relation to
Derco, and non-cash, non-operational losses arising from
hyperinflation accounting relating to Ethiopia of £8m (2023:
£29m). These factors were partly offset by a gain on disposal
of a non-core retail aftersales business in the Americas of
£6m (2023: nil), and non-cash, net impairment reversals of
distribution agreements of £14m (2023: nil). After adjusting
items, reported profit before tax was £414m (2023: £378m).
Net financing costs: Adjusted net finance costs reduced to
£142m (2023: £154m), driven by the positive impact of a
reduction in average net debt on net interest costs. This was
partly offset by an increase in inventory financing costs
associated with a more stable working capital profile, which
resulted in an expense of £56m (2023: £38m). Reported net
finance costs were £150m (2023: £193m). This includes £8m
(2023: £29m) of adjusting items relating to non cash, non-
operational losses arising from hyperinflationary accounting
in Ethiopia.
Tax: On a continuing basis, the effective tax rate on adjusted
profit before tax is 31.3% (2023: 30.0%), and on statutory profit
before tax is 31.2% (2023: 34.4%). The increase in the effective
tax rate on adjusted profit includes the impact of Pillar Two
regulations which are relevant from 2024.
Non-controlling interests: Profits attributable to our non-
controlling interests increased to £14m (2023: £13m). The
Group’s non-controlling interests comprise a 40% interest in
the Group's distribution operations in the Philippines and a
30% holding in the Mercedes-Benz distribution business in
Indonesia. Other significant non-controlling interests include a
30% share in NBT Brunei and a 10% share of Subaru Australia.
Dividend: The Board has proposed a final ordinary dividend
of 17.2p, which is subject to the approval of shareholders at
the 2025 Annual general meeting, and if approved will be
paid on 16th June 2025. This follows an interim dividend of
11.3p, and takes the total dividend in respect of FY 2024 to
28.5p. The Dividend Reinvestment Plan is available to
ordinary shareholders and the final date for receipt of
elections to participate is 23rd May 2025.
Capital expenditure: During 2024, the Group incurred net
capital expenditure of £70m (2023: £62m), consisting of £79m
gross capital expenditure (2023: £93m) and £9m of proceeds
from the sale of property (2023: £31m). In 2025, we continue
to expect net capital expenditure of less than 1% of Group
revenue.
Financing: As at 31 December 2024, the funding structure of
the Group is comprised of a committed syndicated revolving
credit facility of £900m (2023: £900m), sterling Private
Placement Loan Notes totalling £140m (2023: £210m), and a
5 year bond of £350m, at a fixed coupon of 6.5%. During the
year, the term facility of £250m was repaid, following the
disposal of the UK Retail business, together with the debt
acquired from acqusitions in 2022 and 2023. As at 31
December 2024 the syndicated revolving credit facility was
drawn £55m (2023: £150m). Excluding our Revolving Credit
Facility, 100% of the Group's corporate debt is at fixed rates
and is not due to be repaid for at least 2 years. The Group
remains well within its debt covenants.
Pensions: As at 31 December 2024, the IAS 19 net post-
retirement surplus was £23m (2023: £67m), with the decrease
driven largely by lower than expected returns on scheme
assets partially offset by movements in corporate bond yields
affecting the discount rate assumption used to determine
the value of scheme liabilities. In line with the funding
programme agreed with the Trustees, the Group made an
additional cash contributions to the UK pension schemes of
£1m, (FY 2023: £2m). In November 2024, the Trustee of
Inchcape Motor Pension Schemes completed a buy-in
transaction whereby the assets of the scheme were used to
acquire a bulk purchase annuity policy under which the
benefits payable to the members of the scheme are now
fully insured. The insurance policy was purchased using the
existing assets of the scheme with no additional funding
required from the Group.
Foreign currency translation: The impact of foreign currency
translation on profit before tax was (10)%, driven by the
strengthening of the GBP and the devaluation of the
Ethiopian Birr during the year. The impact of foreign currency
translation on the assets and liabilities of the Group's foreign
operations resulted in a loss of £245m (2023: £133m) which
has been reported within other comprehensive income.
Key translational foreign exchange pairings and underlying
adjusted profit before tax sensitivity: The Group operates in
around 40 markets globally and therefore has a broad range
of translational currency exposures against GBP, its reporting
currency. The Group’s major currency pairs are the Euro, the
Australian Dollar, the US Dollar and the Chilean Peso. At
prevailing rates, for FY 2025, a 1% movement in any of these
currencies would have an impact on the Group’s annual
underlying adjusted profit before tax of approximately £1m.
Other key currency pairs are the Hong Kong Dollar, the
Singaporean Dollar, the Colombian Peso and the Peruvian
Sol. At prevailing rates, for FY 2025, a 1% movement in any of
these currencies would have an impact on the Group’s
annual underlying adjusted profit before tax of less than
£0.5m. Adjusted profit before tax from all of these currencies
contribute around 80% of the Group’s adjusted profit before
tax.
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28
APPENDIX–REGIONAL BUSINESS MODELS
AMERICAS
Country
Brands
Argentina
Subaru, Suzuki
Barbados¹
Changan, Chrysler, Daimler Trucks, Dodge,
Freightliner, FUSO, Isuzu, JCB, Jeep, John
Deere, Mercedes-Benz, Mitsubishi, Peugeot,
Subaru, Suzuki, Western Star
Bolivia
Avatr, Changan, Deepal, JAC Motors, Joylong,
Komatsu, Mazda, Renault, Subaru, Suzuki
Chile
Avatr, BMW, BMW Motorrad, Deepal, DFSK,
Changan, Great Wall, Hangcha, Harley-
Davidson, Haval, Hino, Jaguar, JCB, Komatsu,
Land Rover, Landini, Massey Ferguson, Mazda,
MINI, Porsche, Renault, Rolls-Royce, Still,
Subaru, Suzuki, Volvo
Colombia
Citroen, Develon, DFSK, Dieci, Doosan, DS
Automobiles, Great Wall, Hangcha, Hino, JAC
Trucks, Jaguar, Komatsu, Land Rover, Liebher,
Linde, Mack, Mercedes-Benz, Still, Subaru,
Suzuki, XCMG
Costa Rica
Avatr, Changan, Deepal, JAC, Suzuki
Ecuador
Freightliner, Forland, Geely, Mercedes-Benz,
Subaru, Western Star
El Salvador
Freightliner, Geely, Mercedes-Benz, Western
Star
Guatemala
Freightliner, Geely, Mercedes-Benz, Western Star
Honduras
Freightliner, Geely, Mercedes-Benz, Western Star
Panama
Suzuki
Peru
Avatr, BMW, BMW Motorrad, Changan,
Deepal, DFSK, Great Wall, Haval, Hino, JAC
Motors, Komatsu, Mazda, MINI, Renault, Still,
Subaru, Suzuki, XCMG
Uruguay
Freightliner, Fuso, Mercedes-Benz
1.Distribution agreements for these brands across a range of Caribbean islands,
centred in Barbados
APAC
Country
Brands
Brunei
Lexus, Toyota
Guam²
BMW, Chevrolet, Lexus, Toyota, Morrico
heavy equipment³
Hong Kong
Daihatsu, Hino, Jaguar, Land Rover, Lexus,
Maxus, ORA, Toyota
Indonesia
Great Wall, Harley-Davidson, Jaguar, Land
Rover, Mercedes-Benz
Macau
Daihatsu, Hino, Jaguar, Land Rover, Lexus,
ORA, Toyota
Saipan
Toyota, Lexus
Singapore
BYD Commercial Vehicles, Hino, Lexus,
Suzuki, Toyota
Philippines
Changan, Harley Davidson, Jaguar, Land
Rover, Mazda, Mercedes-Benz, Ram
Thailand
Jaguar, Land Rover, Tata Motors
Australia
Distribution: Deepal, Citroen, Foton, Peugeot,
Subaru
Retail only: Isuzu Ute, Jeep, Kia, Mitsubishi,
Volkswagen
New Zealand Maxus, Subaru
2. Distribution agreements for these brands across a range of Pacific islands,
centred in Guam
3. Morrico heavy equipment - Bomag, CNHI International SA, Cummins, Daimler,
Detroit Diesel International Direct, Dieci, DTNA , EL Industries, Fuso, Haulotte,
Hyundai, Kohler, Load King, New Holland, Rosenbauer, Schwarze, Sullivan
Palatek, Vac Con, WanCo
EUROPE & AFRICA
Country
Brands
Belgium
BYD, Lexus, Toyota
Bulgaria4
Lexus, Toyota
Estonia
BMW, BMW Motorrad, BYD, Ford, Jaguar,
Land Rover, Mazda, MINI
Finland
GAC, Jaguar, Land Rover, Mazda, XPeng
Greece
Lexus, Toyota
Latvia
BMW, BMW Motorrad, Ford, Jaguar, Land
Rover, Mazda, MINI
Lithuania
BMW, BMW Motorrad, Ford, Jaguar, Land
Rover, Mazda, MINI
Luxembourg
BYD, Lexus, Toyota
North Macedonia Lexus, Toyota
Poland
Distribution: Jaguar, Land Rover, XPeng
Retail only: BMW, BMW Motorrad, MINI
Romania
Lexus, Toyota
Djibouti
Changan, Komatsu, Toyota
Ethiopia
BYD, Hino, Komatsu, New Holland, Suzuki,
Toyota
Kenya5
BMW, BMW Motorrad, Changan, Jaguar,
Land Rover
4. Distribution agreement for Toyota & Lexus also distributed to Albania,
centred in Bulgaria. 5. Distribution agreement for Changan also distributed
to Tanzania, centred in Kenya, distribution agreement for BMW also
distributed to Djibouti, centred in Kenya and distribution agreement for
Jaguar, Land Rover also distributed to Uganda, centred in Kenya
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Key performance indicators (KPIs) provide insight into how the Board and Group Executive Team monitor the Group’s strategic
and financial performance, as well as directly linking to the key measures for Executive remuneration. KPIs are stated in actual
rates of exchange and pages 190 to 193 provide definitions of KPIs and other alternative performance measures.
REVENUE
£9.3bn
£9.4bn²
£8.1bn³
£6.9bn
£6.8bn
24
23
22
21
20
Definition
Consideration receivable from the
sale of goods and services. It is
stated net of rebates and any
discounts, and excludes sales-
related taxes.
Why we measure
Top-line growth is a key financial
measure of success.
2024 performance
The Group delivered £9.3bn of
revenue, up 4% in constant
currency, supported by 2% organic
growth (excluding currency effects
and net M&A) 2% from
acquisitions, offset by currency
headwinds of (5)%. Revenues were
down (1)% reported versus prior
year. On a constant currency
basis, revenue was in line
with target.
ADJUSTED OPERATING
MARGIN1
6.3%
6.6%²
5.1%³
4.1%
2.4%
24
23
22
21
20
Definition
Operating profit from continuing
operations (before adjusting items)
divided by sales.
Why we measure
A key metric of operational
efficiency, ensuring we are
leveraging our scale to translate
sales growth into profit.
2024 performance
Operating margin is 6.3%, down
(30)bps versus 2023 and down
(20)bps on a constant currency
basis. Margins were supported by
cost discipline. Our margins are
consistent with our guidance of c.
6%.
PROFIT BEFORE TAX AND
ADJUSTING ITEMS1
£444m
£467m²
£373m³
£249m
£128m
24
23
22
21
20
Definition
Represents the profit made after
operating and interest expense
excluding the impact of adjusting
items and before tax is charged.
Why we measure
A key driver of delivering
sustainable growth and growing
earnings to shareholders.
2024 performance
In 2024 this increased 5% on a
constant currency basis, reflecting
resilient margins and the contribution
from acquisitions. Including the
impact of FX, adjusted profit before
tax decreased (5)% to £444m. On a
constant currency basis, adjusted
profit before tax was ahead
of target.
FREE CASH FLOW1
£462m
£492m²
£380m³
£274m
£117m
24
23
22
21
20
Definition
Net cash flows from operating
activities, before adjusting cash
flows, less net capital expenditure
and dividends paid to non-
controlling interests.
Why we measure
A key driver of the Group’s ability to
fund inorganic growth and to make
distributions to shareholders.
2024 performance
The Group delivered free cash flow
(FCF) of £462m, a decrease of (6)%
on 2023 and representing a
conversion of adjusted profit after
tax of 151% and above our
guidance of c.100%.
RETURN ON CAPITAL
EMPLOYED1
27%
27%²
41%⁴
28%
12%
24
23
22
21
20
Definition
Operating profit (before adjusting
items) divided by the average of
opening and closing capital
employed where capital employed
is defined as net assets add net
debt/less net funds.
Why we measure
Adjusted ROCE is a measure of the
Group’s ability to drive better returns
for investors on the capital we invest.
2024 performance
Adjusted ROCE for the period was
27%, compared to 27% in 2023, and
is aligned with our guidance of
25%-30%.
Link to strategy:
Link to strategy:
Link to strategy:
Link to strategy:
Link to strategy:
1. Alternative performance measure, see page 190. 2. Performance in 2023 represented for UK retail disposal. 3. Performance in 2021 represented for Russia disposal.
4. ROCE in 2022 has been adjusted to remove capital employed of Derco. which was acquired on the last day of 2022 and therefore did not contribute to operating profit during that year.
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KEY PERFORMANCE INDICATORS
FINANCIAL KPIs
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30
We have a number of non-financial KPIs which align to our business model as part of our Accelerate+ strategy and
sustainability framework. Our focus on the customer whilst operating responsibly is at the heart of our business model.
This is fundamental to our strategy, and maps the way Inchcape creates sustainable value for all our stakeholders.
BEVs SOLD
2.3%
1.0%¹
0.3%¹
24
23
22
Definition
% volumes of battery electric vehicles (BEVs)
sold*. BEVs are fully battery powered and run on
electric power.
Why we measure
This has been a KPI since 2022. A core element
of our strategy is the deployment of BEVs, which
underpins our core business model and is
fundamental to the long-term sustainability of
the business.
2024 performance
We continue to make progress on the number
of BEVs sold. In 2024, the overall percentage as
a Group has increased across key markets with
electric vehicle offerings, particularly Belgium
and Hong Kong.
As part of our Responsible Business plan, we will
continue to see growth in this trend, particularly
in our developed markets.
*
Outputs of models and processed data are likely to be
affected by the quality of underlying data which include
a number of judgements and assumptions.
REDUCTION IN SCOPE 1 AND 2
GREENHOUSE GAS EMISSIONS
37%
0
0
24
Definition
Aggregate scope 1 and 2 greenhouse gas
emissions in 2024 vs 2019 baseline.*
Further information can be found in the Task
Force on Climate-related Financial Disclosures
on pages 35 to 51.
Why we measure
This KPI was created in 2022. Reducing the
emissions over which we have the greatest
degree of control is a key sustainability priority for
the Group. We have set targets for scopes 1
and 2 using Science Based Targets
methodology with the aim of reducing our
emissions by 46% by 2030 and achieving net
zero by 2040.
2024 performance
Scope 1 and 2 emissions were reduced by over
22,000 tonnes measured on a market basis and
by over 12,000 tonnes on a location basis
against the 2019 revised baseline. Greenhouse
gas emission reductions is a strategic element of
the Group Chief Executive’s bonus – please see
page 98 for further details.
*
2019 figures have been restated to reflect relevant
disposals, acquisitions, and data rectification.
REPUTATION.COM SCORE
761
702
671
642
566
24
23
22
21
20
Definition
A measure of the end customer experience in
our dealerships (both distribution and retail),
using Google Business Profile star ratings among
other metrics. Score goes up to 1,000.
Why we measure
Customer reputation score is a measure we
introduced in 2018 which provides a
commercially relevant customer experience
measure using Google Business Profile and
monitors customer sentiment.
2024 performance
Adoption of Reputation continues to grow, and
we now have 1,000+ dealership locations
tracking customer reviews, 25% of which
achieved best in class scores of 800 or more.
Our focus in 2024 moved beyond the overall
review score to the intelligence sourced from
visitor comments and the insights we can use to
further lift dealership service levels. Additionally
we can now attribute scores and insights to
distinct departments in Sales and Aftersales,
giving our management teams precise
information into successes and opportunities
across the whole customer service journey.
WOMEN IN SENIOR
LEADERSHIP POSITIONS
28%
26%¹
24%¹
22%¹
24
23
22
21
Definition
Percentage of women in senior leadership,
which includes the Group Executive Team and
its direct reports.
Please see page 80 for more information,
including a complete breakdown of the gender
diversity within the Group.
Why we measure
We are committed to increasing the proportion of
women in senior positions to 30% by the end of 2025,
with a sustained focus on developing and retaining
talented women across the business. Tracking this
KPI allows us to measure progress, identify barriers,
and drive meaningful action towards a more
gender balanced leadership team.
2024 performance
We have remained steady in our representation
of women in senior positions, notably alongside
the sale of UK retail. In 2024, we launched a
programme focused on female talent
development across all levels of the business to
further strengthen retention and our pipeline
into senior positions. Over 150 women have
participated in the programme so far across all
regions and in 2024 we achieved our target of
30% female representation across our
global workforce.
Link to strategy:
Link to strategy:
Link to strategy:
Link to strategy:
1. Represented for UK disposal
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KEY PERFORMANCE INDICATORS
NON-FINANCIAL KPIs
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31
THE GLOBAL
MOBILITY
TRANSITION,
DELIVERED
LOCALLY
Inchcape’s role is to help to create a
transition that is inclusive and long-lasting,
with a commitment to work collaboratively
with stakeholders to shape a future where
sustainable mobility is a reality for all.
As one of the most disrupted industries worldwide, the
automotive sector faces transformative shifts driven by
consumer trends, regulatory pressures, emerging
technologies, and evolving supply chains. The need to
reduce global emissions produced by the industry is being
met by new low-carbon technologies, changes to
infrastructure, and shifts in the modes through which
transport is delivered.
This change – termed the ‘mobility transition’ – is
acknowledged for its risks, but also brings unique
opportunities for Inchcape to play a pivotal role in steering
the course towards sustainable mobility. We recognise that
engaging with and responding to these opportunities is
what our stakeholders are asking of us.
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SUSTAINABILITY
32
Inchcape.com
DELIVERING INSIGHTS
Talented diverse colleague base supplying
local expertise and knowledge of their
Markets.
Use our experience and data to identify
insights for our stakeholders and aid their
understanding of the transition.
Industry-leading Digital, Data & Analytics to
understand consumer needs, and provide
market intelligence for our partners.
c.18,000
Our role
Becoming a leading authority in the
mobility transition in our markets
and helping to close knowledge
gaps for the benefit of our OEMs,
policy makers, and customers.
talented diverse colleagues around the world
ENABLING NEW
TECHNOLOGIES
Provide comprehensive end-to-end
support in the roll-out, lifecycle
management, and aftersales of products.
Train and upskill our people so that they
are equipped to offer our customers the full
range of options.
Embrace the next phase of mobility,
emphasising sustainability, customer-
centric solutions, and responsible practices
across our diverse Markets.
1,000+
Our role
Driving the adoption of new
technologies from our OEM partners
across our Markets by fostering the
ecosystem needed for widespread
low-emission vehicle use.
technicians completed a battery repair
training programme
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SUSTAINABILITY CONTINUED
How we deliver our ambition
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33
PROVIDING
THE MOST
SUSTAINABLE
ROUTE-TO-
MARKET
Operating as a responsible business
underpins our strategy. We are
dedicated to creating sustainable
value for all our stakeholders, with a
focus on driving what matters to our
people and enhancing the impact
of our practices on our planet, the
communities we serve, and the
places where we operate.
A BREAKDOWN OF THE GROUP’S GENDER DIVERSITY CAN BE FOUND
ON PAGE 80.
Planet
Recognising our industry’s environmental
impact, the Planet pillar leads our efforts to
address climate change.
• 7.5% market-based reduction of scope 1 and 2
emissions year-on-year.
• Overall emissions reduction of over 22,000 tCO2e
scope 1 and 2 emissions, which represents a 37.5%
reduction from the 2019 baseline.
• 70+ Inchcape sites worldwide now have solar
installations.
• All Regions improved year-on-year performance in
market-based emission reductions.
People
Supporting our people and nurturing their
talents and wellbeing, the People pillar
promotes a safe, inclusive, and diverse
workplace.
• Inclusive Hiring Training Programme launched to
over 1,000 hiring managers.
• Launch of our new Aspire Programme for female
development with over 150 participants globally.
• Roll-out of career conversations toolkits and
significant increase in managers having career
development discussions.
• Be Heard survey: 90% response rate and 83%
inclusion score in 2024.
• Reuters D.R.I.V.E. award: shortlisted for diversity,
equity, and inclusion commitment.
Places
Driving impactful change by focusing on
safe mobility and social inclusion through
the Places pillar.
• Two key themes: safe mobility and social inclusion.
• Expansion of our Road Safety Programme into
New Zealand.
• Our Ethiopia team implemented Defensive Driving
Training for colleagues and customers to help
anticipate and react to potential hazards.
• Built our Women Mechanics Training Programme in
Uruguay, with planned expansion across the Americas.
• Continued partnerships across all Regions with a focus
on accessible mobility solutions of people
with disabilities.
Practices
Operating ethically drives the Practices
pillar to rigorously update and reinforce
our policies.
• Global training on anti-bribery and corruption.
• Creation of an Open Doors Policy and process
across the Americas with expansion planned
globally.
• Cybersecurity: Ongoing trainings for all colleagues
and awareness campaigns.
• We have reached 16,000+ colleagues with our
annual attestation of our Code of Conduct.
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We consider these impacts in the development of our strategy
and into our risk analysis. We set appropriate metrics and
targets that operate within a robust governance framework.
This supports our purpose of bringing mobility to the world’s
communities for today, for tomorrow, and for the better.
As one of the most disrupted industries worldwide, the
automotive sector faces transformative shifts driven by
consumer trends, regulatory pressures, emerging technologies,
and evolving supply chains. The need to reduce global
emissions produced by the industry is being met by new low
carbon technologies, changes to infrastructure, and shifts in
the modes through which transport is delivered. This mobility
transition has acknowledged risks but also brings unique
opportunities for Inchcape.
This Report sets out how we assess and report on climate-
related risks and opportunities which are embedded into our
governance, strategic, and risk management process and
our targets and associated metrics.
The climate-related financial disclosures made by Inchcape
plc comply with the requirements of the Companies Act
2006 as amended by the Companies (Strategic Report)
(Climate-related Financial Disclosure) Regulations 2022.
This year, our disclosure is consistent with the TCFD
recommendations except for the disclosure of an internal
carbon price (ICP), which we explain in the metrics and
targets section on page 48. We have also not quantified the
potential financial impact for Risk 4 and Opportunities 1 and
2 in this disclosure because the data is not yet sufficiently
robust. We have therefore concluded that such analysis
would not lead to better informed decision making at this
stage, but we expect to build on these strong foundations in
future disclosures. This will be reviewed in 2025 and an
update provided in the next Annual Report and Accounts.
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OUR APPROACH TO
CLIMATE CHANGE
Companies have a duty to do all they can to mitigate the impacts of
climate change. Understanding the impact the automotive industry
has on the environment and the likely impact on our business means
that we can be well prepared for future challenges.
TCFD index
Key
ALIGNED
UNALIGNED
TCFD disclosure
Description of progress
Pages
Governance
a) Describe the Board’s oversight of
climate-related risks and
opportunities.
b) Describe management’s role in
assessing and managing climate-
related risks and opportunities.
36 to 37
Strategy
a) Describe the climate-related risks
and opportunities the organisation
has identified over the short,
medium, and long-term.
b) Describe the impact of climate-
related risks and opportunities on
the organisation’s businesses,
strategy, and financial planning.
c) Describe the resilience of the
organisation’s strategy, taking into
consideration different climate-
related scenarios, including a 2°C or
lower scenario.
38 to 39
Risk
management
a) Describe the organisation’s process
for identifying and assessing
climate risk.
b) Describe the organisation’s
processes for managing climate-
related risks.
c) Describe how processes for
identifying, assessing, and
managing climate-related risks are
integrated into the organisation’s
overall risk management.
40 to 45
Metrics and
targets
a) Disclose the metrics used by the
organisation to assess climate-
related risks and opportunities in line
with its strategy and risk
management process.
b) Disclose scope 1, 2, and, if
appropriate, scope 3 greenhouse
gas emissions and the related risks.
c) Describe the targets used by the
organisation to manage climate-
related risks and opportunities and
performance against targets.
48 to 49
GOVERNANCE
a) Describe the Board’s oversight of climate-related risks
and opportunities
b) Management’s role in assessing and managing
climate-related risks and opportunities
The Board has ultimate responsibility for the management
and oversight of climate-related issues which are considered
by the Board during its discussions on strategy, risk
management, remuneration, financial performance, and
environment, social, and governance matters. The Board is
also responsible for approving and monitoring strategic
programmes and expenditure. Further information on the
Board’s consideration of climate change in relation to
strategy is given on page 38.
The Board delegates certain climate-related responsibilities
to the Audit Committee. This includes responsibility for
reviewing the Group’s principal and emerging risks, including
those impacted by climate change. The Audit Committee
also considers the impact of climate change when assessing
significant accounting judgements and the ongoing viability
of the Group. The Audit Committee meets five times a year,
with risks being considered quarterly and significant
accounting judgements considered twice a year. The Audit
Committee provides an update to the Board following each
meeting. Further information on the activities of the Audit
Committee is given on pages 81 to 88.
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The Sustainability Committee also has delegated climate-
related responsibilities from the Board. In addition to
responsibility for the Group’s overall sustainability strategy,
the Sustainability Committee oversees climate-related
reporting and monitors the setting and achievement of
climate-related targets. The Sustainability Committee meets
three times a year and provides an update on its activities to
the Board following each meeting. The Sustainability
Committee Report is given on pages 89 to 90 and further
information on climate-related activities are given on page
46 of this Report and in the standalone Sustainability Report
which can be found on the Company’s website at
www.inchcape.com/sustainability.
The Remuneration Committee has responsibility for
considering the inclusion of climate-related metrics in the
Group’s incentive plans and approving and assessing
achievement of targets for Executive Directors. Further
information is given in the Directors’ Report on Remuneration
on pages 98.
The Group Executive Team (GET) has primary responsibility for
assessing and monitoring climate-related risks and
opportunities, which are embedded into the day-to-day
operations through a combination of:
• the development and implementation of the Accelerate+
strategy; and
• the design and implementation of the Group’s enterprise
risk management (ERM) framework.
The GET has several sub-committees which assist it in
assessing climate-related risks and opportunities, including:
• The OEM Pipeline Committee consists of all GET members.
Its remit is to consider new OEMs and M&A opportunities
whilst taking into account the risk of misalignment between
our product portfolio in a given Market and the pace of EV
adoption in that Market; and
• The Investment Committee consists of the Group Chief
Executive, Group Chief Financial Officer, Group General
Counsel & Group Sustainability Officer, and members of
the finance, strategy, and legal teams. Its remit includes
the review of capital expenditure in relation to climate-
related projects, and the review of energy efficiency
designs for new sites and refurbishments.
The GET also has responsibility for the Group’s ERM
framework. Detailed ERM plans to mitigate short-term
climate-related risks are developed by each Region with
approval and oversight on progress by the GET on a
quarterly basis. In addition, the members of the GET are
responsible for identifying and managing risks in their own
business areas and the GET as a whole determines the
Group’s principal risks at both the half year and year end
following a comprehensive risk management review process.
The Sustainability Reporting and Disclosure Committee
(SRDC) consists of the Group Chief Financial Officer, Group
General Counsel & Chief Sustainability Officer, Chief Strategy
Officer, Head of Internal Audit, and Group Company
Secretary. The SRDC meets quarterly to monitor the main
climate-related risks and opportunities, in the context of
strategy, governance, and financial performance.
It monitors:
• regulations impacting the Group’s operations including the
Corporate Sustainability Reporting Directive, International
Sustainability Standards Board, and Transition Plan
Taskforce, establishing a global approach to
implementation;
• the climate-related risk assessments carried out by the
Markets and Regions evaluating the impact of current and
emerging climate-related risks;
• the impact of the Accelerate+ strategy including new
OEM partners and new geographies in the contest of
misalignment;
• the view of investors on climate-related risks and
opportunities and how they see them impacting
the business;
• progress against emissions reduction, and the
implementation of energy efficiency measures across
the Group; and
• the communication of climate-related risks and
opportunities throughout the Group via colleague training,
webinars, and other sustainability related programmes.
The Board, its Committees, and the GET are supported by
colleagues throughout the organisation whose day-to-day
actions contribute towards reducing the impact the business
has on climate change. The SRDC also plays a key role in
ensuring the flow of information within the business.
The Group’s functions are also critical in the measuring,
monitoring, and implementation of climate-related
processes:
• finance functions - responsibility for the Group-wide
emissions reporting framework, and assessment of the
financial impact of climate change on impairment;
• strategy functions - monitor changing EV environment in
terms of OEM partners, customers, and the infrastructure in
the markets in which the Group operates;
• risk functions - responsibility for the integration, monitoring,
and review of climate-related risks into the Group’s ERM
framework. Monitoring and escalating Tier 2 and emerging
risks as appropriate;
• legal and compliance functions - review existing and
emerging regulatory obligations, and consideration of
OEMs’ approach to climate-related risks and opportunities;
and
• sustainability functions - monitor progress against scope 1
and 2 emission reduction targets, monitor implementation
of policies, tools and best practice, and design and roll out
the Group’s energy efficiency plan.
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STRATEGY
a) Climate-related risks and opportunities over the short,
medium, and long-term
b) Describe the impact of climate-related risks and
opportunities on the organisation’s business, strategy,
and financial planning
c) Describe the resilience of the organisation’s strategy
taking into consideration different climate-related
scenarios, including a 2°C or lower scenario
The impacts of man-made climate change are material and
are being felt today by the customers and communities that
we serve. Those impacts will only grow over time. The
automotive sector recognises this and is on a journey to
decarbonise. This journey will bring risks and opportunities for
our business; consideration of those risks and opportunities is
therefore an integral part of the process to define and
execute our strategy.
To identify our climate-related risks, we have looked at
transition and physical risks:
• transition risks are risks associated with changes to the way
Markets operate that may result from regulation or
consumer habits as we transition to a low carbon
economy; and
• physical risks are the exposure of our assets or value
chain to physical hazards caused by the effects of
climate change.
In 2022, we evaluated the implications of climate risks and
opportunities over the following time periods:
• short-term (up to 2026): a three-year period aligns with our
viability assessment and incorporates the actions needed
to achieve our short-term targets;
• medium-term (up to 2030): this time period aligns with our
interim climate-related targets; and
• long-term (2030 to 2050): this time period aligns with our
long-term climate-related targets.
Transition risks bring the most material climate-related
impacts to our strategy. We identify these risks and
opportunities through:
• regulatory horizon scanning. Senior leadership and their
teams are accountable for identifying regulatory risk and
incorporating these into the existing risk register; and
• assessment of key external forces such as Market,
technology, and political and social trends that could
affect the business or our reputation. Our Strategy team
specifically recognises climate change as an external
force linked to Market and technology risks.
Our exposure to physical risk is identified and monitored
through our scenario analysis. We assess the impact of six
different acute hazards against our assets out to 2050. We
screen our sites for insured value, stock value, and exposure
to physical hazards using climate models.
The table on pages 43 to 45 sets out:
• a description and summary of the most significant climate-
related risks and opportunities to the Group’s strategy;
• the financial impact over the short, medium and
long-term;
• the Group’s strategic response and resiliency; and
• metrics used to measure the impact and achievement
of strategy.
Climate-related risks and opportunities are considered during
the strategic, operational, and financial planning process as
this ensures decisions are aligned with the Group’s purpose
and sustainability framework.
To reduce the potential impacts of climate risks and take
advantage of opportunities, the Board considers:
• the misalignment risk analysis is used to inform OEM
participation and consolidation strategy;
• new aftersales revenue streams to develop aftersales
strategy;
• identification and development of alternative value pools
to offset margin risk; and
• incorporation of transition and physical risk considerations
in acquisitions and future growth plans.
FURTHER INFORMATION ON THE ACCELERATE+ STRATEGY CAN BE FOUND ON
PAGES 18 TO 22.
FURTHER INFORMATION ON THE SUSTAINABILITY STRATEGY CAN BE FOUND ON
PAGES 32 TO 34.
FURTHER INFORMATION ON THE FINANCIAL IMPACTS CAN BE FOUND ON
PAGES 157 TO 158.
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The Accelerate+ strategy has been designed to drive scale
in new and existing Markets through acquisitions and
contract wins, and optimise our global Distribution operations
through Value Added Services to deliver sustainable and
profitable growth. These services include our opportunity to
grow in vehicle parts and Finance & Insurance to support the
new energy vehicle (NEV) transition and to continue to
develop our used car proposition.
Our refreshed strategy has been derived based on an
unbiased outlook into 2035 and with strategic guidelines in
mind. To prioritise strategic opportunities, we use ‘future-
back’ scenarios taking into consideration different
dimensions, including sustainable technology driven
economies, social importance, effects on aspects of life,
importance in decision making, government intervention,
and zero emission vehicles penetration.
One of the strategic guidelines under Accelerate+ is the
route to decarbonisation which paves a clear route to
lowering Inchcape’s emission intensity and helps to enable
the NEV transition. In particular, the Scale pillar of
Accelerate+ aims to increase portfolio diversification, which
will assist with mitigating climate-related risks.
In order to limit global warming to less than 2°C above pre-
industrialised levels, there would need to be an acceleration
in the energy transition, including faster adoption of battery
electric vehicles (BEVs) and misalignment between the
adoption of BEVs, and the pace of adoption remains the
most significant risk to the delivery of the Accelerate+
strategy.
If not planned for appropriately this could lead to loss of
market share in the Markets in which we operate. This has led
to a considered approach to M&A and contract wins with
misalignment risk analysis inputting into the Board’s
consideration of OEM partners and consolidation strategy.
When making strategic decisions the Board considers:
Powertrain
Impact of BEV adoption on global emissions
Alternative EV powertrains
Regional EV adoption
EV batteries
Market
Regulation
Impact of subsidies
EV adoption forecasts
OEM
partners
OEM landscape
OEM partner commitments
The Group has focused on strengthening its strategic
partnerships with OEMs who are well placed to succeed in
the global mobility transition in order to mitigate the risk
of misalignment.
Chinese OEM partners are playing an increasingly important
role in the global automotive market, not least as a result of
their leading position in BEV technology. We are continuing
to develop our relationships with Chinese OEMs, in particular
those that have a strong BEV offering. This includes BYD, SAIC,
Changan, and Great Wall Motors.
During 2024, Inchcape continued to build a resilient strategy
with several new contract wins which address the
misalignment risk in our Markets. These included two in
Australia, in adjacent vehicle categories: Deepal, an
all-electric brand from Changan Automobile; and, Foton,
a light commercial vehicle brand whose product range for
Australia will also feature electrified Foton SUVs and vans.
With EVs projected to grow in the Australian market over the
coming years, the partnerships serves a growing demand
and supports the Accelerate+ strategy in delivering the
mobility transition. Inchcape also strengthened its partnership
with BYD, winning the distribution contracts in Estonia and
Ethiopia in 2024. This builds on our existing agreements with
BYD in Belgium and Luxembourg, and BYD commercial
vehicles in Singapore.
All our OEM partners are developing their BEV offerings at
pace and we play an important role in helping them to
understand the speed and characteristics of the transition in
the markets in which we operate. This ensures we have a
resilient strategy by ensuring that we have the right product
available for our customers at the right time and in the
right place.
The Board and the Group Executive Team review climate
change factors that could impact the business plan in the
short, medium, and long-term, and the scenario analysis
around the potential impacts of climate change, such as
expectation of the pace of change, and how transition to
BEVs will impact the operations carrying out servicing
or repairs.
Key steps undertaken in financial planning is to ensure that
the base case forward cash flow assumptions remain
appropriate in light of the scenario analysis and to ensure
that the sensitivity analysis performed covers all the
reasonably probable outcomes identified through the
scenario analysis. Further information is given in the Financial
Statements on pages 158 and 159.
When choosing with which OEMs to focus our growth, the
Company considers how future-proof the OEM is, including
its NEV commitments and line-up, among other parameters.
When prioritising specific growth opportunities for both
Markets and OEM partners, we consider the impact every
choice has on our sustainability goals and on our ability to
influence and support sustainability in Markets.
As a result of our approach, breadth of OEM relationships,
and flexible business model, we believe that we have a high
degree of resilience to a range of different climate-related
scenarios and are well placed to respond to the risks and
take advantage of the opportunities.
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RISK MANAGEMENT
a) Describe the process for identifying and assessing
climate risk
b) Describe the process for managing climate-related risks
c) Describe how the processes for identifying and
managing climate-related risks are integrated into
overall risk management.
Identification of climate-related risks and
opportunities
A full value chain analysis at business level was carried out in
2021, resulting in a shortlist of five climate-related risks and
two climate-related opportunities detailed on pages 43
to 45.
Key exposures were reviewed and assessed by conducting
workshops and interviews with a range of stakeholders across
strategy, finance, and risk management. Using the outputs of
our assessment we reviewed the long list of climate-related
risks and opportunities (CROs) to develop a short list of key
CROs for the business. Each risk and opportunity is
qualitatively rated for likelihood, velocity, and
potential impact.
In 2022, we carried out a quantified scenario analysis on the
key CROs identified. This process concluded that some CROs
have a low financial impact and others can be combined
with adjacent risks. The scenario analysis will be performed
again in 2025 to assess whether there are any changes to the
climate-related risks and opportunities identified and to the
financial impact over the short, medium, and long-term.
Following the acquisition of Derco in 2023, and other
acquisitions and disposals which have taken place since
2021, the structure of the Group has changed and an
internal reassessment of the risks and opportunities was
carried out in 2024. Please see the risk management process
on page 42.
Comparative importance of risks
Likelihood - To assess the likelihood of a CRO, we considered
the alignment between the outcome under a 1.5ºC
scenario, 4ºC scenario, and an intermediate scenario in
which temperatures are more likely than not to exceed 2ºC.
Each risk is then categorised as very high, high, medium,
or low.
Velocity - Our assessment at the time in which the exposure
to each CRO is expected. The purpose of this measure is to
assess how fast external pressures are changing. Velocity
was assessed across the defined short, medium, and
long-term horizons.
Potential impact - The potential impact was determined
which qualitatively categorised CROs and considered
technology trends, supply/demand projections, impact to
revenue, and impact to our cost base.
Scenario analysis
Climate scenario analysis helps us understand the potential
financial impacts to our business, in its current state, from our
short-listed CROs under two scenarios: 1.5ºC and 4°C.
Scenarios
IPCC RCP
2.6
1.5°C aligned
• Higher transition risk
• Lower physical risks
• Strong government intervention
IEA NZE
1.5°C aligned
• Additionally to RCP 2.6, it includes a
granular accelerated EV transition
NGFS Net
Zero
1.5°C aligned
• Additionally to RCP 2.6, it includes disorderly
and orderly carbon price assumptions
IPCC RCP
8.5
4°C aligned
• Low government intervention
• Business as usual emission increases
• Lower transition risks
• Higher physical risks
IEA NZE: International Energy Agency Net Zero.
NGFS Net Zero: Network for greening the financial system.
IPCC: Intergovernmental Panel on Climate Change.
Our 1.5°C scenario is characterised by accelerated
intervention and is used to assess our exposure to higher
impacts from a transition to a low carbon economy. Our 4°C
scenario assumes greater impacts from physical risks.
Combining the outputs of both will inform the key areas
where our response must focus.
Representative Concentration Pathways (RCP) were chosen
because they are defined emissions pathways which can be
input into global climate models to derive the physical
climate futures.
The IEA NZE scenario was selected due to the additional
detail specific to the transport sector. This granularity is critical
because the transition from internal combustion engine (ICE)
to EVs is significant to our business.
The NGFS Net Zero scenario was used to assess our exposure
to carbon taxes because it includes Regional carbon prices
which vary significantly across our Markets. It enables
comparison between orderly and disorderly scenarios using
the same sources, and there is transparency over the key
policy changes that drive modelling assumptions.
Further details of the NGFS Net Zero scenarios are
publicly available.
FURTHER INFORMATION ON CLIMATE-RELATED RISKS CAN BE FOUND ON
PAGES 52 TO 56.
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Scope of analysis
Transition risks
To scope Markets for our analysis we set a financial threshold for coverage. We included the Markets with a significant contribution to our operating profit until we had coverage which was over 70% of
overall operating profit. This helped us filter Markets and compare the relativity of these financial impacts.
CROs were assessed at either a Market-level and aggregated up to determine the financial exposure; or due to data constraints, we assessed the risk exposure at a global level. We are taking
steps to enable detailed quantification in future reporting.
Climate risk
Level of granularity
Markets included
Misalignment
Market-level (10%+ of operating profit
by Market coverage in scope)
Australia, Belgium, Chile, Hong Kong, Luxembourg, and Singapore
Aftersales
Global level
A shift from conventional ICE to BEV could potentially develop new aftersales services specifically targeted for BEV. Despite uncertainty
over how new revenue streams could evolve over time, our analysis showed potential cash flows are expected to be more significant
for BEV than for ICE vehicles due to additional weight and cost of electric components, albeit less regular in occurrence. The impact on
aftersales is considered both a risk and an opportunity.
Carbon tax
Market-level
All Markets
Margin pressure
Analysis of potential impacts performed on a qualitative basis
Physical risks
Physical risk analysis considered the impact of six key acute hazards, including coastal inundation, surface water flooding, riverine flooding, extreme wind, forest fire, and extreme heat. A
screening of 590 sites by hazard type, insured value, stock value and gross profit was completed to determine those sites that are financially significant. The screening filtered the sites down to
23. For these sites we investigated the likelihood and severity of each hazard to provide an overview of the potential asset and stock value at risk, and the impact on operations.
The maps identify the most material sites and the relative exposure under the RCP 8.5 pathway, which represents a high emissions scenario, exceeding 4°C.
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Risk management process
The Group manages its risks through its Enterprise Risk
Management Framework (ERM). Risk thresholds are defined
by geography (Market, Region, and Group) or strategic
importance (project, programme, and portfolio). Risks are
categorised dependent on their impact, considering more
than just financial risk and each criteria overlaps so risks are
escalated/demoted accordingly. The Group defines risk
appetites as risk-averse, risk tolerant, and risk seeking. The
appetite for each specific risk is decided by the Group.
We manage and monitor climate-related risks and
opportunities through both a top-down and bottom-up
process. For each risk, our Markets consider the impact and
risk appetite to determine the target risk level. To monitor and
manage risks, each risk is assigned to a risk owner and action
owners. This risk owner is accountable for the risk and holds
action owners to account for progressing action that move
the risk to its target level.
On a quarterly basis the risk management team holds a risk
review with each Market to understand their risks, monitor
movements, and determine if risks are pervasive across
Markets, which may require aggregation of risk impacts.
As part of the annual risk assessment process, all Markets and
Regions provide more detail on the specific climate-related
risks and opportunities (CRO assessments), which are added
to the risk register to be monitored on an on-going basis.
Outputs from CRO assessments also provide insight into
strategic planning for the Markets and Regions. The risk of
EV supply and demand is a mandatory assessment for
each market.
The CRO assessments completed in 2024 indicate certain
transition risks are becoming more relevant and important,
however climate-related opportunities have also been
identified by a larger number of Markets. Analysis of our
current CROs against globally recognised frameworks have
not identified any significant deviations and indicate that
there is no material change to the profile of the key climate-
related risks. A full value chain scenario analysis will be
carried out in 2025.
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The Group's principal and 'watchlist' risks are reviewed quarterly by the Group Executive Team.
The Board reviews risk appetite and the Group's principal and 'watchlist' risks twice a year.
The Audit Committee reviews the effectiveness of the risk management and internal control framework.
Principal risks
Risks which could materially
impact delivery of Accelerate+
Emerging risks
Emerging or lower-level risks which
may materialise over time
Risk information
• Trends and latest updates
• Impact and likelihood
• Mitigating controls and
effectiveness
• Future action plans
How
• Board review and approval of
principal risks and risk appetite
• Audit Committee ongoing review
of effectiveness of systems
• GET ongoing review of risks and
mitigations
• Regional Risk Committees
ongoing review of local risks and
action plans
Risk assessment at
Market, Region, function,
and programme-level
Climate-related
risk and opportunity
assessments
Internal control
assessments and
internal audit findings
External reports, including
analysts’ reports and peer
or suppliers’ public
disclosures on risk
Risks
Financial impact
Risk Description
Summary
Scenario
Short
Medium
Long
Strategic response and resiliency
Measurement
1
MISALIGNMENT BETWEEN
OEM PARTNERS AND
MARKETS ON NEVs LEADS
TO MARKET SHARE
DECLINE
Misalignment between the speed at
which our OEMs transition their model line-
up to NEVs and the pace of adoption in
the Markets in which we operate. This
misalignment may mean that we lose
market share. Analysis showed the risk of
misalignment is greatest in the short to
medium-term in the APAC region but is
expected to disappear by 2050.
IEA NZE 1.5°C
N/A
As part of our broader strategy, our ambition is to form new partnerships with
pure EV entrants to expand our OEM partner portfolio. We have taken proactive
steps to achieve this by joining with OEMs such as BYD and Great Wall Motor
ORA. This will help offset any potential misalignment identified with our current
portfolio.
We are actively taking measures to facilitate the EV transition through:
• providing consumers with the option of a NEV alternative for every ICE model;
• facilitating EV charging through product packages to enable customers to
switch to EVs; and
• providing consumers knowledge of quantified carbon footprint savings for
choosing BEV.
Metric:
• NEV sales as a % of
new vehicle sales
Sensitivity:
• % Revenue CAGR
• % Gross margin
• % Long-term growth
rate
4°C
N/A
2
REDUCTION IN
AFTERSALES REVENUE FOR
NEVs
Due to a reduced number of moving
parts in a BEV compared to an ICE
vehicle, we may experience a reduction
in revenue generated from the existing
aftersales services we offer around repair,
maintenance, and replacement of parts.
Our analysis indicated this may affect our
retail businesses more than our distribution
businesses.
IEA NZE 1.5°C
N/A
The low-impact outcome from this risk is largely driven by the relatively low
global NEV volume in comparison to ICE in 2030 in a 1.5°C scenario. However,
this exposure may affect us in the long-term as global NEV volumes increase.
Therefore, we are considering an expansion of our proposition for aftersales
services to include new NEV-specific services. Potential services could include
battery diagnostics and transportation for end-of-life batteries. These additional
services could help offset any potential impact to revenue reduction from
aftersales services.
Metric:
• % of AFS revenue
attributable to NEV
Sensitivity:
• % Revenue CAGR
• % Gross margin
• % Long-term growth
rate
4°C
N/A
3
CARBON TAX COSTS
Governments are likely to use carbon
taxation as a mechanism to decarbonise
the economy. Despite expected variation
in carbon tax policy across countries, we
anticipate carbon taxation will affect all
Markets. We analysed this risk across our
scope 1 and 2 emissions.
NGFS 1.5°C
orderly
Our analysis considers our targets and presents reduced impact if we take
action. Based on these findings we are actively implementing decarbonisation
levers across scope 1 and 2 to ensure we meet our interim target of 46%
reduction by 2030 and net zero by 2040 (please see pages 46 to 47). This
includes switching to renewable electricity supply and installation of solar panels
at our larger sites. Our strategy acknowledges a faster decarbonisation can
help avoid the risk of high carbon tax costs.
Metric:
• Scope 1 and 2
absolute
Sensitivity:
• % Revenue CAGR
• % Gross margin
NGFS 1.5°C
dis-orderly
4°C
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KEY
FINANCIAL IMPACT KEY:
TIME HORIZON KEY:
Distribution Excellence
impact to revenue <£100m
(up to 2026): three-year period aligns with viability assessment
New energy vehicles
impact to revenue £100m – £200m
(up to 2030): aligns with interim climate-related targets
Value Added Services
impact to revenue >£200m
(2030 to 2050): aligns with long-term climate-related targets
Risks continued
Financial impact
Risk Description
Summary
Scenario
Short
Medium
Long
Strategic response and resiliency
Measurement
4
TRANSITION TO NEVs
LEADS TO PRESSURE ON
DISTRIBUTOR MARGINS
An accelerated EV transition could affect
certain cost drivers for our OEM partners
until cost parity is reached between NEVs
and ICE vehicles, which in turn could lead
to potential downwards pressure on
distributor margins. However, where there
is the potential for current prices to be
maintained for NEV vehicles, the impact
on gross margins can be mitigated or
maintained.
IEA NZE 1.5°C
N/A
N/A
N/A
Our analysis indicates that the impacts of margin pressure may be offset due to
the disparity of price between NEVs and ICE vehicles. We actively monitor
margins at the Market level and our Accelerate+ strategy is designed to
address this risk by providing a compelling offering to our OEMs (Distribution
Excellence), capturing additional vehicle profit pools (Value Added Services)
and enabling expansion into new, margin-accretive Markets through M&A. We
have not quantified the potential impact as the data is not sufficiently robust,
and therefore we concluded that such analysis would not lead to better-
informed decision making.
Metric:
• Gross margin
Sensitivity:
• % Average gross
margin
4°C
N/A
N/A
N/A
5
PHYSICAL RISK – DIRECT
IMPACT TO PROPERTY
AND INVENTORIES FROM
EXTREME WEATHER
EVENTS
Exposure to climate-related physical risks
can expose our property and inventory to
potential damage. It can also lead to
business interruption at our sites causing
lost revenue. Our 590 sites were screened
against six acute physical hazards. We
then calculated our exposure for our 23
most material sites.
RCP 2.6 1.5°C
Our analysis showed low impacts across our physical assets with the highest risk
exposure from surface water floods in Singapore. However, this resulted in low
impact due to the low financial significance and existing insurance policies in
place to mitigate the risk. To mitigate risk for future sites from new acquisitions we
will include physical risk assessments in our consideration of organic and
inorganic growth opportunities.
Metric:
• % sites at risk from
physical hazards
Sensitivity:
• % Revenue CAGR
4°C
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KEY
FINANCIAL IMPACT KEY:
TIME HORIZON KEY:
Distribution Excellence
impact to revenue <£100m
(up to 2026): three-year period aligns with viability assessment
New energy vehicles
impact to revenue £100m – £200m
(up to 2030): aligns with interim climate-related targets
Value Added Services
impact to revenue >£200m
(2030 to 2050): aligns with long-term climate-related targets
Opportunities
Financial impact
Opportunity Description
Summary
Scenario
Short
Medium
Long
Strategic response and resiliency
Measurements
1
ALIGNMENT BETWEEN
OEM PARTNERS AND
MARKETS ON EVs LEADS
TO MARKET SHARE
INCREASE
In Markets where there is a rapid shift
towards EVs, there is potential to capture
market share where supply of EVs from
our OEMs keeps pace with NEV adoption
rates. In a 1.5°C scenario, the
accelerated EV transition increases this
potential opportunity, with our analysis
showing this opportunity is most significant
in the near-term where the disparity
between different levels of EV supply from
OEM partners is greatest.
IEA NZE 1.5°C
N/A
N/A
N/A
As part of our broader strategy, our ambition is to consider forming new
partnerships with pure EV entrants to add to our OEM portfolio. We have not
quantified the overall opportunity from alignment due to a lack of robust data,
however we assess the financial opportunity presented from new OEM partners
within specific markets on a case-by-case basis.
Metric:
• NEV sales as a % of
new vehicle sales
Sensitivity:
• % Revenue CAGR
• % Gross margin
• % Long-term growth
rate
4°C
N/A
N/A
N/A
2
INCREASE IN AFTERSALES
REVENUE FOR NEV
A shift from conventional ICE to NEV
could potentially develop new aftersales
services specifically targeted for NEV.
Despite uncertainty over how new
revenue streams could evolve over time,
our analysis showed potential cash flows
are expected to be more significant for
NEV than for ICE vehicles due to
additional weight and cost of electric
components, albeit less regular in
occurrence.
IEA NZE 1.5°C
N/A
N/A
N/A
We are facilitating the choice of a NEV among consumers in our retail business
by increasing consumer knowledge of the benefits of NEVs and expanding our
aftersales services to facilitate NEV adoption for the customer. The potential size
of opportunity has not been quantified due to a lack of robust data and
significant uncertainties in how the aftersales market could evolve. However
work is ongoing to consider how we can expand our aftersales proposition with
new NEV-specific services and we will continue to monitor changes to aftersales
market dynamics.
Metric:
• % of AFS revenue
attributable to NEV
Sensitivity:
• % Revenue CAGR
• % Gross margin
• % Long-term growth
rate
4°C
N/A
N/A
N/A
We have disclosed the financial impact, up to 2030, of our
CROs as low, medium, and high impact, which is aligned to
our risk rating criteria as defined by our risk management
framework. We have not specifically quantified the long-
term impacts of EV transition due to the inherent uncertainty
of the extent of the CRO. In comparison, data sets and
assumptions for carbon taxes and physical risks are more
readily available so have been disclosed to 2050.
Estimates for the potential financial impact of climate risks
are indicative at this stage, with significant uncertainties in
their underlying assumptions. We aim to build on this analysis
going forward, improving on the robustness of data and
assumptions where available. The likelihood of all risks
manifesting concurrently is very low, so the aggregation of
potential impacts would represent an extremely
unlikely scenario.
The misalignment risk analysis is used to inform the judgement
on impairment, further details can be found in the financial
statements on pages 158 and 159.
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KEY
FINANCIAL IMPACT KEY:
TIME HORIZON KEY:
Distribution Excellence
impact to revenue <£100m
(up to 2026): three-year period aligns with viability assessment
New energy vehicles
impact to revenue £100m – £200m
(up to 2030): aligns with interim climate-related targets
Value Added Services
impact to revenue >£200m
(2030 to 2050): aligns with long-term climate-related targets
HOW WE ARE DRIVING ACTION
TO REDUCE EMISSIONS
During the year we continued to develop our plan to reduce emissions
supported by short, medium, and long-term actions. The plan is
commensurate with the Accelerate+ strategy and demonstrates how
we will continue to grow a sustainable and climate resilient business.
74% of our scope 1 and 2 emissions come from our
buildings (location-based): our dealerships, our
warehouses, our offices, and our call centres. Reducing
the amount of energy that we use in our premises is
therefore a key element of our decarbonisation
programme. As well as reducing our carbon footprint,
this also reduces cost and mitigates the impact of
future energy price rises.
Achievements in 2024 include:
• Peru implemented a refrigerant recycling system and
energy efficient light systems in its logistic centre
which combined is estimated to save 180 tCO2e per
annum.
• LED upgrades were installed at three Hong Kong sites
with estimated saves of 148 tCO2e per annum.
• Energy audits were carried out in 36 sites across
APAC, of which these sites account for c. 71% of our
electricity consumption for the Region.
Onsite generation enables an immediate reduction of
site CO2 emissions. The benefits include the production
of carbon-free electricity, reduction in electricity costs,
and moderates impact of future electricity price rises.
Onsite generation also provides security of supply.
Generating renewable electricity at our premises
means that we do not need to draw electricity from
the grid. It reduces our carbon footprint, saves us
money, and provides energy security for the future.
Achievements in 2024 include:
Solar panels were installed in:
•
Ecuador, El Salvador, and Guatemala which
generate 80% of each sites electricity consumption.
There are 860 panels generating 450,000 kWh per
annum across these sites;
•
six sites in Australia which are forecast to save 249
tCO2e per annum;
•
Guam which are forecast to saved 90 tCO2e per
annum; and
•
two sites in Greece were installed which are
forecast to save 57 tCO2e per annum.
National grids are steadily decarbonising as they
become increasingly reliant upon renewable sources
of electricity. Using electricity rather than fossil fuels
therefore helps us to reduce our emissions footprint.
Achievements in 2024 include:
• Singapore switched from a diesel powered paint
booth to an infrared booth, saving estimated
24 tCO2e per annum.
• Costa Rica and Hong Kong are expected to save
11 tCO2e per annum from changing ICE vehicles in
its fleets to hybrid and electric vehicles.
Buying electricity on green tariffs contributes to a
reduction in carbon emissions.
Achievements in 2024 include:
• 24% of all sites are on green tariffs.
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MINIMUM REQUIREMENTS FOR ALL
INCHCAPE BUSINESSES
Energy efficiency
Identifying opportunities to reduce
energy consumption through efficient
running of our buildings and investing in
energy efficiency.
Green tariffs
To maintain and extend our green tariff
procurement programme.
Identify other opportunities for renewable
electricity procurements, such as power
purchase agreements.
Electrification
To plan for our locations to be all electric
with the removal of fossil fuels, in normal
operation.
To move our company car fleet to NEVs.
Onsite generation
To identify more opportunities to install
solar panels as well as identify other onsite
renewable technologies, such as ground
source systems where possible.
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Pathway to net zero scope 1 and 2 target (tCO₂e market-based)
METRICS AND TARGETS
The Group uses a variety of metrics to measure the current
and potential impact of our climate-related risks and
opportunities, including greenhouse gas (GHG) emissions
and business specific metrics. Our metrics are laid out across
the seven cross-industry metric categories defined by
the TCFD.
In 2021, we established our GHG reduction target to reduce
our scope 1 and scope 2 emissions by 46% by 2030 and in the
longer term we are committed to reaching net zero by 2040.
The GHG emissions, capital deployment, and remuneration
metrics are used to measure our progress to net zero. Pages
46 to 47 sets out the actions being taken across the Group to
reduce emissions. We measure the number of new energy
vehicles (NEVs) sold to monitor the impact of misalignment
risk and misalignment opportunity.
The Company has considered whether it would assist its
emissions reduction efforts to introduce an internal carbon
price. The Company believes that it has sufficient tools and
opportunities available to enable it to continue to reduce its
controllable emissions at the present time such that the
introduction of an internal carbon price is not necessary at
present. However, the position is regularly monitored as
management understand that this can be a powerful tool in
driving sustainable practices.
Greenhouse gas emissions
Direct GHG emissions are from our operations through
combustion of fuels (scope 1). We also purchase energy from
the grid (scope 2) and have indirect GHG emissions
throughout the value chain mainly because of our purchase
of goods, consumer use of vehicles, and transportation,
which together make up more than 97% of our total scope 3
emissions. We are acting across all three scopes and working
closely with our partners to reduce GHG emissions for our
business, our customers, and our value chain. We report our
greenhouse gas emissions according to the Greenhouse Gas
Protocol, published by the World Business Council for
Sustainable Development, and the World Resources Institute.
Please see page 50 for our Streamline Energy and Carbon
Emission reporting (SECR).
Key metrics used to measure progress
Key
n Metric in place (market-based)
n No metric in place
*Excludes any emissions, site, and initiatives undertaken by UK Retail, which was sold in August 2024. Following this, Inchcape has made a number of key
judgements, estimations, and assumptions from the underlying data when determining key metrics.
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Metric
category
Status
Metric
2024
actual*
2023
actual
Objective
GHG emissions
n
Absolute scope 1 and 2 emissions (tCO2e)
37,243
40,261
To track the reduction in our emissions,
improvements in our energy efficiency and
generation of our own renewable power
n
% of sites at 100% renewable electricity
24%
32%
n
Energy intensity by revenue (tCO2e/£m)
4.0
4.3
Physical risk
n
We do not have a physical risk metric in place
Capital
deployment
n
% of capex towards climate initiatives
2.8%
4.2%*
To demonstrate the level of investment we are
committing towards climate to achieve our strategy
Remuneration
n
Scope 1 and 2 emissions (tCO2e)
37,243
40,261
Incentivising leadership to deliver emissions
reductions. Included in the short-term incentives
Transition risk
n
% of NEV sold
13%
22%
-% of NEV sold
Opportunities
n
% of NEV sold
13%
22%
-% of NEV sold
Internal carbon
pricing
n
We do not have an internal carbon pricing in place
Scope 1 and 2 emissions (tCO2e)
The target is to reduce scope 1 and 2 emissions by 46% by
2030. As at 31 December 2024, Inchcape has reduced its
market-based scope 1 and 2 emissions by 37.5% from its 2019
baseline.
Whilst there remains opportunities to reduce emissions,
particularly around purchase of renewable energy, other parts
of operational emissions are harder to abate. Therefore it will
become increasingly challenging as we approach the
2030 target.
Market-based
Location-based
The 2019 baseline has been adjusted in line with Inchcape
policy derived from GHG Protocol Corporate Standard
‘Tracking Emission Over Time’ for structural changes in the
business including M&A and divestitures, and for amendments
for data gaps above a significant threshold.
Scope 3 footprint
During 2024, the Sustainability Committee and the GET
considered whether it would be appropriate to set reduction
targets for scope 3, taking into account the level of control the
Company has in relation to different scope 3 categories and
the assessment of emissions trajectories to 2030 under
different scenarios.
The vast majority of the Group’s scope 3 are attributable to
the vehicles and parts that we buy and sell. Inchcape’s most
material scope 3 emissions come from category 1 (purchased
goods and services) and category 11 (use of sold products).
Scope 3 breakdown
24%
68%
8%
Category 1
Category 11
Other
When considering whether to set Science Based Targets
initiative (SBTi) aligned scope 3 targets, five target options
were taken into account:
• supplier engagement - all vehicles - categories 1 and 11;
• absolute emissions - all vehicles - category 11;
• absolute emissions - passenger vehicles - category 1 and 11;
• intensity (economic) - category 11 (per revenue); and
• intensity (physical) - category 11 and 11 (per vehicle).
The emissions footprint was modelled across two scenarios,
most likely and accelerated transition. The analysis showed
that Inchcape’s absolute emissions rise due to growth in sales
and whilst the intensity target bring Inchcape closest to SBTi
reductions it is still not sufficient.
Factors influencing the results
OEMs - among Inchcape’s main OEM partners, only three
have targets relevant to Inchcape markets, and some OEM
partners targets exclude Inchcape markets.
Markets - Inchcape operates in markets with a slower transition
which typically have less ambitious EV policies.
Commercial vehicles - whilst HGVs see a drastic reduction to
intensity owing to electrification projections, the contribution
to absolute emissions rise due to an increase in sales.
SBTi constraints - Inchcape emissions breakdown means that a
target cannot be set to cover category 11 emissions for
passenger vehicles only as this would not meet the SBTi
coverage threshold. If Inchcape only targets passenger
vehicles, this would result in the inclusion of category 1
emissions which continue to grow due to lack of OEM targets
and a rise in BEVs with more emission intensive batteries.
Outcome
The analysis shows that Inchcape is not projected to be able
to achieve any of the SBTi aligned candidate targets at this
time. The Sustainability Committee reported its assessment to
the Board and it was agreed that scope 3 targets would not
be set due to the challenges in achieving them. The Board will
continue to monitor the feasibility of setting targets on a
regular basis.
Despite challenges in setting targets, the review of our value
chain emissions was also an opportunity to further consider our
role as a facilitator for the industry-wide changes required. As
our OEM partners are at different stages of their sustainability
journeys, we focus on enabling them to deliver their transition
strategies sustainably and effectively.
Under our guiding principle, ‘the global mobility transition,
delivered locally’, we remain committed to supporting both
emerging and advanced markets as they navigate the
mobility transition. By working alongside OEMs to achieve
meaningful and lasting outcomes, we play a vital role in
driving emissions reductions across the industry – contributing
to lower value chain emissions and creating a more
sustainable future for mobility.
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Total: 14.5mill
tCO2e
STREAMLINED ENERGY AND
CARBON REGULATIONS (SECR)
We collect data for all material emissions for which we deem
ourselves to be responsible and look for ways in which to
minimise our footprint. Data is collected for two key
performance indicators: our use of gas and fuel in vehicles
we own (scope 1); and, our global energy usage (scope 2).
The table does not include scope 3 intensity ratios or
emissions data.
Data collection and reporting period
Data has been collected for all Markets from 1 January 2024
to 31 December 2024. The level at which we report is by
business unit for each Market. This covers our retail operations,
distribution operations, and business service operations, which
fall within our operational scope.
Intensity ratio
The Group’s intensity ratio compares emissions data by
dividing total tonnes of CO2e by revenue, an appropriate
financial indicator. This allows for a fair comparison over time
of CO2e emissions given the growth trajectory envisaged for
the Group and cyclical variations in business activity. As
required under SECR regulations the following information
relates to the energy consumed in our operations. The list of
UK entities is given on page 209.
Emissions data previously published in the 2023 Annual Report
has been restated. This is because the prior year has been
adjusted for structural changes in the business and
amendments for data gaps.
Carbon efficiency measures
The Group’s controllable emissions management team
developed its strategic programmes to reduce carbon
emissions, focusing on four key areas: energy efficiency,
on-site renewable energy generation, electrification, and
renewable electricity purchasing. Our Markets are
implementing the programmes to identify opportunities to
reduce our carbon emissions.
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2024
2023
Metric category
UK & offshore
Global
UK & offshore
Global
Total energy consumption (kWh)
301,954
152,073,291
323,684
189,775,459
Scope 1 (tCO2e)
46
20,418
49
21,733
Stationary combustion (tCO2e)
46
6,960
49
8,190
Vehicle fuel combustion (tCO2e)
—
12,299
—
11,892
Fugitive emissions (tCO2e)
—
1,158
—
1,651
Scope 2 (location-based, tCO2e)
10
26,576
11
29,105
Scope 2 (market-based, tCO2e)
10
16,825
11
18,528
Total scope 1 & 2 (location-based, tCO2e)
56
46,994
60
50,838
Scope 1 & 2 emissions intensity ratio (location-based, tCO2e/£m)
—
5.1
—
5.4
Total scope 1 & 2 (market-based, tCO2e)
56
37,243
60
40,261
Scope 1 & 2 emissions intensity ratio (market-based, tCO2e/£m)
—
4.0
—
4.3
Revenue (£m)
—
9,263
—
9,382
Methodologies used in calculation of disclosures
GHG Protocol Corporate Accounting and Reporting Standard
GHG Protocol Corporate Value Chain Accounting and Reporting Standard
GHG Protocol Scope 2 Guidance
Inchcape applies the GHG Protocol Corporate Standard for tracking emissions over time to identify rebaselining events.
Emissions data previously published in the 2023 Annual Report has been restated due to structural changes in the business.
Examples of this include the 2024 disposal of the UK Retail division and the sale of retail and wholesale alternative parts
businesses in Chile.
INFORMATION ON CARBON EFFICIENCY MEASURES INTRODUCED IN 2024 CAN BE FOUND ON PAGE 46.
The table below is intended to help our stakeholders understand our position on key non-financial matters and climate-related financial disclosures in line with the reporting requirements
contained in sections 414CA and 414CB of the Companies Act 2006.
Fair review of our business
Summary
See pages
Business model
A description of the Company’s business model which drives our strong financial profile
11 to 13
Strategy
A description of the Company’s strategy
18 to 22
Financial performance and stability
The development, performance, and position of the Company’s business during the financial year
23 to 28
Key performance indicators
Financial, environmental, and colleague metrics to measure the Company’s performance effectively
30 to 31
Section 172(1) statement
Summary of how the success of the Company for the benefit of its members was promoted
72 to 77
Sustainability
Summary
See pages
Our approach to sustainability
Description of environmental matters and respect for human rights
32 to 34
Culture and values
Description of colleague related matters
15 and 76
Colleague inclusion and diversity
Description of initiatives and breakdown of gender and ethnic minority data across the Group
34, 77, and 80
Community activities
Description of activities in the communities in which we operate
34 and 90
Environmental matters
Summary
See pages
Task Force on Climate-Related Financial Disclosures
‘Climate-related financial disclosures’, as defined in section 414CB of the Companies Act 2006
35 to 49
Streamlined Energy and Carbon Reporting regulations
The Company’s scope 1, 2, and 3 greenhouse gas reporting for the financial year
47 to 50
Principal risks and uncertainties
Summary
See pages
Risk management
Main trends and factors likely to affect the future development position of the Company’s business
52 to 61
Governance
How the Audit Committee manages principal risks
81 to 88
Group policies in relation to matters concerned above
Summary
See pages
Anti-bribery and corruption
Maintaining effective systems to counter bribery in all our business dealings and relationships. There were no
material instances of this during 2024
34 and 72
Code of conduct
Outlines the standards of behaviour expected of all colleagues and suppliers across the Group
34, 86, and 107
Safety and wellbeing
Health and safety is at the forefront of our organisational priorities and is integrated into our strategy
53, 55, and 59
Modern slavery
A guide to ethical business conduct and the minimum standards of behaviour expected
72
Tax
Explains the frameworks, processes, and controls required to meet the Group's tax responsibilities
72, 84, 86, and 154
Whistleblowing
Framework for disclosing concerns to any forms of wrongdoing or concealing wrongdoing
76 and 86
Inclusion & Diversity
Our Inclusion & Diversity Framework drives action on inclusive culture across Inchcape
76 and 111
All Group policies above are either available on our website or are summarised in the Code of Conduct which is available at www.inchcape.com.
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EFFECTIVE RISK MANAGEMENT -
ENABLING OUR GROWTH AMBITION
We accelerate the performance of our OEM partners, the well-being of our colleagues,
and the interests of our communities and investors through well-managed risk-taking.
PRINCIPAL RISKS
Approach to risk management and internal control
Effective risk management is essential to executing our
Accelerate+ strategy and achieving sustainable stakeholder
value. We believe that effective risk management starts with
the right conversations to drive better business decisions. Our
primary focus is to identify and embed mitigating actions for
significant risks that could affect our current or future
performance, sustainability, and/or our reputation.
Three lines of defence model
Our risk management efforts aim to be holistic and
integrated, bringing together risk management, internal
controls, and sustainability initiatives to ensure key risks
associated with our strategy are effectively managed.
Inchcape deploys the ‘three lines of defence model’ to
manage risk which is overseen by the Board and its
Committees. Accountability for managing risk is, however,
fully embedded across our business. Each Region and
function undertake quarterly risk assessments, establish
mitigation plans, and monitor risk on a regular basis. These
risks are consolidated into our Group’s principal risks and
emerging risks and are reviewed by the Group Executive
Team and Board at least on a quarterly basis or when new
risks arise. The Board sets and reviews the risk appetite for
each principal risk every six months. The Audit Committee
review the effectiveness of the risk management and internal
control systems at least annually
Our principal risks are the highest rated ‘net’ risks, after
mitigation has been applied. Risks are rated by impact
(minimal, minor, moderate, major, or critical) and by
likelihood (rare, unlikely, possible, likely, or almost certain).
Impact is estimated in terms of: financial; health, safety, and
environment (HSE); reputational; operational; and strategic
criteria. Data is used to inform assessments where available,
which are largely qualitative, drawing on the insight and
experience of leadership teams across the business.
Overview of our principal Risks
Our ambition to be the most efficient and sustainable
route-to-market for our OEMs through the delivery of
Accelerate+ brings with it many external and internal
forces to manage. Our risk management process is
designed to identify, assess, and appropriately mitigate the
risks to our strategy within our risk appetite to ensure our
ambition is achieved.
During 2024 we have seen changes to our risk landscape,
in particular following the sale of our UK Retail business, the
increased supply of vehicles, currency volatility, and
continuous changes in climate related regulations in the
markets we operate in. We have responded effectively to
these changes through our robust systems of risk
management and internal controls:
• The disposal of our UK Retail business and the launch of
Accelerate+ provided an opportunity to align our risk
profile to one that is predominantly distribution focused.
• The integration of Derco has progressed to an extent
where the risks of delivering the integration are no longer
a principal risk for the Group. We continue to monitor
risks arising from our new acquisition through the
Regional risk reviews.
• As markets continue to embrace the impact of climate
change, we have seen increased changes to carbon-
related taxes and regulation. We continue to leverage
brand diversification tactics and relationships with our
OEM partners to optimise EV supply and demand in
our Markets.
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• Currency volatility remains inherent to our business and
the markets we operate in, particularly in 2024 with the
devaluation of the Ethiopian birr and the Bolivian
boliviano coupled with a strengthened British pound. Our
global footprint and robust transactional foreign
exchange processes and controls coupled with strong
cash management and inventory optimisation strategies
ensured that the net risk exposure is contained within
risk appetite.
• In line with our planned programme of ‘deep dives’
throughout the year we focused on HSE including EV and
physical and mental wellbeing in Q1. Additional measures
were identified to further reduce HSE risks in particular
those risks associated with EV transition. Good progress has
been made and we are expecting the likelihood of this risk
to reduce further in 2025.
As we deliver our Accelerate+ strategy, 2025 will see us build
on our foundations to identify new areas of opportunities and
inevitably risks. These include our ability to scale our business
creating new OEM relationships and building even stronger
partnerships with existing OEMs in existing and adjacent
segments, also to grow our business improving profitability
without an increase in costs. Under our Optimise pillar, Value
Added Services will also see us leveraging our global scale
within the parts business using our existing digital platforms to
engage and retain customers for longer. Finance and
Insurance, and new energy vehicle segments, will also drive
further success for the Group in pursuit of our strategy.
Our risk management framework, although structured, has
been designed to be nimble to adapt to an ever-changing
environment, this has already taken place during the year as
we refresh the risks to achieving our new strategy whilst
maintaining an appropriate risk culture that supports business
operations and assists the Board in complying with
obligations under the UK Corporate Governance Code.
Principal risks facing the Group
The Group’s principal risks, and their relation to strategy, are
shown below. Further details on impact, likelihood, and trend
are given on pages 54 to 58.
Key changes to the principal risks
Derco integration and new market
entrants risks have been removed from
the Group’s list of principal risks in
2024. Due to increasing supply
globally, the supply chain
disruption risk was replaced
by inventory optimisation.
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PRINCIPAL RISKS
Principal risks (Tier 1)
The Tier 1 risks have the highest relative
impact or likelihood scores and are
assessed as the most significant ‘net’ risks,
after mitigation has been applied.
KEY IMPACT
LIKELIHOOD
RISK TREND
STRATEGIC IMPACT
STRATEGY DELIVERY AND TRANSFORMATION
Success of the Group’s strategic transformation priorities are
dependent on the delivery of a number of key enabling
programmes.
There is a risk that we lack the capacity and risk mitigation to
deliver on these key enabling programmes on time and to
the required quality, while realising the expected benefits.
Mitigating actions
We actively monitor these programmes through:
•
oversight by the Group’s Transformation Committee,
supported by Portfolio Management tool to track status;
•
ongoing reviews and re-prioritisation of initiatives and
resourcing to ensure focus on strategic imperatives;
•
risk and issue management; and
•
system stabilisation programme.
Strategic impact
Risk level with current mitigation
EV TRANSITION
Continued transition from internal combustion engines (ICE)
to new energy vehicles including battery electric vehicles
(BEVs), further increases our exposure to commercial and
regulatory risks. The two main risks that have emerged from
the transition to EV for Inchcape includes:
• a misalignment between market uptake of EVs and OEM
EV supply. This may be caused by new tax incentives or
legislation; the level of market EV infrastructure or other
factors; and
• Inchcape will be subject to increased carbon-related
legislation or taxes and other indirect measures which
price carbon emissions into our Markets. The introduction
of these measures may impact our businesses in terms of
product mix or allocation; loss of market share or margin;
or additional financial obligations.
Mitigating actions
We address these risk factors through:
•
monitoring and aligning to emerging EV-related legislation
in each Market;
•
Market-level risk assessment of EV infrastructure, legislative
plans, OEM partners, and competitive capability;
•
close liaison with OEM partners to understand their
ambitions and feedback on the EV readiness of individual
markets, and to ensure optimal EV allocation;
•
brand diversification – contracts with new OEMs; and
•
operational changes to marketing, pricing, customer
service, and vehicle technician training.
Strategic impact
Risk level with current mitigation
MARGIN PRESSURE
The risk of increased pressure on our margins is exacerbated
by the introduction of new routes to market and additional
costs as OEMS seek to maintain their own margins. Achieving
the lowest cost route-to-market will increase the pressure on
margins for all distributors, including Inchcape. This risk is closely
linked to and impacted by inventory optimisation and macro-
economic conditions risks.
Mitigating actions
Actions to grow, and as a minimum, maintain current margins
under Accelerate+ include:
• scaling our core passenger car distribution business into
the most attractive markets, with the most attractive and
feasible OEMs;
• optimising our distribution platform, looking for
opportunities to improve effectiveness of our route-to-
market strategy, to mitigate headwinds;
• extending the distribution platform into new vehicle
categories such as vans, premium two-wheelers, trucks,
and construction equipment, supported by value chain
activities that drive an effective distribution platform;
• Distribution Excellence, by transforming the route-to-
market via the development of a consistent,
technologically advanced, low-cost, low-carbon
distribution and retail offering; and
• budgeting, planning, and forecasting procedures,
including cost containment where needed.
Strategic impact
Risk level with current mitigation
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CYBERSECURITY INCIDENT
We have made significant developments
connecting our organisation, centralising
our digital and cyber capabilities, and
strengthening our cyber defences. As we
become a more connected organisation,
the impact of an attack is heightened. This
coupled with geopolitical tensions, the
continued rise of AI, and the digitalisation of
our business through Distribution Excellence,
increases the materiality of cyber attacks,
which, if successful, could result in
confidential data being compromised,
significant business disruption, reputational
damage, and/or financial loss.
Mitigating actions
•
Continuous alignment to global cyber
security control framework (NIST).
•
Robust cybersecurity measures,
including policies and controls, asset
management, risk assessment, access
control, protective technologies,
vulnerability management, and disaster
recovery plans.
•
Regional and Group level security
operations monitoring.
Strategic impact
Risk level with current mitigation
MACRO-ECONOMIC
CONDITIONS
Failure to react quickly enough to changing
macroeconomic conditions could
adversely impact financial performance,
this includes growth rates, inflation, other
changes to consumer discretionary
spending, and global trade tensions.
Inflationary pressures have eased across the
globe following post-Covid and post-
Ukraine peaks, they are also expected to
ease further into 2025. However, high
inflation and interest rates which increase
our operating costs remain in some of
geographies.
Mitigating actions
We address these changes through:
•
maintaining and increasing our
geographic diversification as well as our
diversified OEM partner portfolio (origin,
segments, positioning and more) to
offset downturns in any particular
Market;
•
management and monitoring of cost
base;
•
Continuous sales and operational
planning process;
•
cash flow and margin management;
and
•
reviews of potential cost base
efficiencies.
Strategic impact
Risk level with current mitigation
HSE: HEALTH, SAFETY, OR
ENVIRONMENTAL INCIDENT
The operation of vehicles, machinery, and
other manual activities across all of our
operations worldwide exposes our
colleagues, customers, and the public to
risks of serious injury or fatality. We also
operate in Markets where there may be a
risk to personal safety.
The use, and disposal, of harmful substances
and chemicals poses a risk to the
environment. These risks are exacerbated
by the introduction of new technologies,
such as BEVs, as we bring new businesses
and contracts into the Group. 2024 has also
seen this risk expand to include mental and
physical well-being as a strategic
development priority for the Group.
Mitigating actions
•
Introduction of a dedicated safety risk
management programme for BEVs.
•
Ongoing implementation and
monitoring of HSE programmes, including
mental health support.
•
Roll-out of EV site reviews and the
executive due diligence programme.
•
Targeted HSE training.
•
Global security programme.
•
Regular review of performance by the
Board and Group Executive Team.
•
Continuous evaluation and remediation
of risks related to all business operational
activities.
Strategic impact
Risk level with current mitigation
POLITICAL RISK
Geopolitical forces, coupled with
macroeconomic stress, increase the
likelihood of international and domestic
tensions, disputes, conflict, and unrest.
Election cycles in 2024 increased the
likelihood of volatility across our Regions with
the potential to disrupt the safety of our
colleagues, property, and business
operations.
Mitigating actions
• Investment in global security threat
assessments and global crisis
management.
• Business continuity framework and
training.
• Insurance policies.
• Collaboration with OEMs on stock
allocation flexibility.
• Digital trading capabilities.
Strategic impact
Risk level with current mitigation
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Other principal risks (Tier 2)
The Tier 2 risks are listed after current
mitigation. Rating scales are the same
as those applied to Tier 1 risks.
KEY IMPACT
LIKELIHOOD
RISK TREND
STRATEGIC IMPACT
Risk title
Strategic
impact
Description and impact
Trend
Key mitigating actions
ACQUISITION
EXECUTION
Inorganic growth through
M&A is a key enabler of the
Accelerate+ strategy and
continues to play an
important role in delivering
scale. There is a risk that
Inchcape may not achieve
the targeted ROI on
acquisitions due to factors
occurring throughout the
M&A lifecycle, from deal
origination to post-acquisition
integration.
•
Pipeline of opportunities.
•
Experienced M&A teams at
Group and Regional levels.
•
Synergy evaluation and
qualification.
•
M&A playbook.
•
Post-merger reviews and
audits.
•
Board review of larger
transactions.
•
Monitoring of risks and issues
post-completion.
BUSINESS
INTERRUPTION
(PANDEMIC,
NATURAL
HAZARDS)
A significant interruption to
our business due to external
events, a global health
emergency, or other natural
hazard could restrict access
to our sites, negatively affect
our operations and brands,
or pose a threat to the safety
of our colleagues; any of
which could have a
negative impact on our
commercial and financial
performance.
•
Board, GET, and wider
leadership crisis management
training and exercising.
•
Operational resilience
framework rolled out.
•
Technology response and
recovery plans.
•
Property risk assessments and
loss control measures.
•
Global flexible working
policies including hybrid
working is well embedded
across the group.
•
Insurance coverage.
•
Financial headroom and
balance sheet strength.
Risk title
Strategic
impact
Description and impact
Trend
Key mitigating actions
FINANCIAL
REPORTING,
FRAUD
The Group may be subjected
to the risk of inaccurate or
delayed financial reporting or
fraud. These risks may increase
as we integrate new
acquisitions or transform
established ways of working.
•
Group Code of Conduct and
relevant training.
•
Established financial policy
and control framework.
•
Monthly monitoring of control
performance.
•
Change management and
staff retention arrangements
to enable a smooth transition.
•
Internal Audit assurance
reviews.
•
Group and Regional controls
oversight.
•
Integration of financial
controls into new businesses,
with training, support, and
hyper-care assurance.
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Risk title
Strategic
impact
Description and impact
Trend
Key mitigating actions
FOREIGN
EXCHANGE
VOLATILITY
With a geographically diverse
structure, Inchcape is exposed
to movements in exchange
rates at a transactional level
within Markets and at a Group
level when asset values are
translated back to GBP
for consolidated
reporting purposes.
•
Treasury Policy and
hedging strategies.
•
Central treasury function and
Regional treasury centres
(in relevant Regions).
•
Monthly monitoring of foreign
exchange impacts and
hedging positions.
•
Increasing geographical
footprint and profit pools
under Accelerate+.
LEGAL AND
REGULATORY
COMPLIANCE
Non-compliance with
legislation and other regulatory
requirements in the Markets we
operate including those
relating to anti-bribery and
corruption, data protection,
competition, and anti-money
laundering. This could affect
our reputation with OEMs,
customers, and wider
stakeholders in addition to our
ability to meet the terms of our
distribution and retail contracts
and contractual risks assumed
during acquisitions.
•
Consistent ‘tone from the top’,
Code of Conduct and related
training, including induction
training and metrics.
•
Whistleblowing line.
•
Compliance policies and
procedures (global and local)
supported by Regional training
as required.
•
Compliance risk assessments
and heatmaps for material areas
of legal and regulatory
compliance.
•
Group monitoring of local
compliance status, legal review
of Distribution agreements,
M&A and integration: approval
procedures and legal
team engagement.
•
Governance committees for
Sustainability reporting
and disclosures.
•
Nominated legal representative
and/or retained counsel in major
Markets to monitor existing and
emerging legislation.
Risk title
Strategic
impact
Description and impact
Trend
Key mitigating actions
LOSS OF
MATERIAL
DISTRIBUTION
CONTRACT
Building and maintaining long-
standing partnerships with our
OEMs is the foundation for our
ability to execute our strategy.
Should we lose any of our long-
standing material distribution
contracts this would have a
significant impact on revenue
and profit, as well as future
growth opportunities.
The Group’s Accelerate+ strategy is
designed to mitigate this risk in the
following ways:
•
maintaining strong relationships
with OEM partners by delivering
on our value proposition;
•
scaling our distribution business
into the most attractive and
feasible markets and OEMs;
•
capture more revenue streams
through Value Added Services;
and
•
operating responsibly is central
to our mobility partnerships.
TECHNOLOGY
SYSTEMS OUTAGE
(NON-CYBER)
There is a risk that we do not
have timely or reliable access
to business-critical information
or information systems. This
could be due to issues such as
systems outages, software
glitches, hardware failure,
system complexity, and
capacity or ineffective
change management.
•
Centralisation and cloud-hosting
for critical systems, where
possible.
•
Continuity plans and
procedures, including disaster
recovery plans and backups.
•
Third-party systems and services
management.
•
Monitoring of incidents and
alert thresholds.
•
Business continuity exercise and
test for Digital Delivery Centres.
•
IT general controls in place
and audited.
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Risk title
Strategic
impact
Description and impact
Trend
Key mitigating actions
PEOPLE: FUTURE
SKILLS
In order to deliver Accelerate+
the Group needs to ensure
that we possess the
appropriate skills and
knowledge to deliver on our
objectives. As we venture into
new parts of the strategy
which requires new ways of
working there is a risk that we
are dependent on people with
business-critical skill sets which
are in demand and may
become harder to recruit
and retain.
Our recruitment strategies
continued to successfully
deliver the skills required to
deliver the Accelerate+
strategy. Although reduced,
this risk remains under close
consideration as we further
build on the future capabilities
required to achieve
company success.
•
Strategic resource planning.
•
Future skill sets defined;
current gaps identified.
•
Specialist recruitment
agencies used.
•
Reward and compensation
packages.
•
Recruitment targets.
•
Established key skill sets.
•
Recruitment procedures.
•
Company profile and
branding.
•
Development programmes,
e.g. digital academy, digital
literacy programmes, internal
moves, and project
opportunities.
INVENTORY
OPTIMISATION
Risk that we have excess
inventory that we cannot sell
at acceptable margins; or that
we must forego opportunities
to sell at attractive margins
due to a shortage of stock. This
is particularly relevant to
oversupply and capacity of
new energy vehicles and parts.
•
Sales and operation planning
procedures.
•
Product mix optimisation.
•
Close management and
monitoring of margins.
•
Portfolio management and
close liaison with our OEMs.
PEOPLE:
ENGAGEMENT AND
RETENTION
If the Group is unable to recruit
and retain qualified personnel
in a timely manner, this could
have an adverse impact on
the achievement of
strategic objectives.
Our 2024 Colleague
Experience Survey (Be Heard)
highlighted continued
opportunities for us to
strengthen our employee
engagement. The impact of
our reinforced retention
strategies will be reassessed
through our Pulse survey in
April 2025.
•
Colleague experience
surveys followed by analysis
and action planning at senior
management level.
•
Colleague well-being
frameworks, programmes,
and support.
•
Global leadership and
enhanced career
development programmes
and talent reviews.
•
Reformed change
management and retention
initiatives.
•
Pay and reward reviews and
benchmarking.
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Risk appetite
Risk appetite is the cornerstone of the Group’s approach to risk management and is
determined by the Board. Risk appetite provides direction to all areas of the Group on
acceptable levels of risk and where further remediation is required to reduce the risk to
acceptable levels. Acceptable levels are determined by the target risk rating for each
principal risk. The Board has considered its risk appetite in relation to the Group’s
principal risks in July and December 2024. Risks were allocated to one of three
acceptable levels of exposure, indicating tolerable levels of risk:
We are prepared to (or
may have to) accept
elevated levels of risk in
these areas:
• cybersecurity incident;
• macro-economic
conditions; and
• political risk.
We have a moderate
appetite for these areas
of risk. We will take
action to reduce risk
levels if they reach
elevated levels.
• Acquisition execution.
• Business interruption
(pandemic, natural
hazards).
• EV transition.
• Foreign exchange
volatility.
• Inventory optimisation.
• Loss of material
distribution contract.
• Margin pressure.
• People: engagement,
retention.
• People: future skills.
• Strategy delivery and
transformation.
We have a low or very
low level of tolerance
for these risks. We will
take action to keep
them as low as
reasonably practicable.
• HSE incident.
• Financial reporting,
fraud.
• Legal, regulatory
compliance.
• Loss of technology
systems (non-cyber).
Emerging risks
Emerging risks are those uncertain events for which timing,
impact, or probability are difficult to quantify. Our global
footprint and our ambition to be the number one route-to-
market for our OEMs exposes Inchcape to an ever-changing
and dynamic environment of economic, political,
environmental, social, legal, and technological risks.
We identify emerging risks in various ways: through the
strategic replanning process; external publication analysis
(including peer reviews and OEM partner risk disclosures);
review of risk studies and publications; the regular cadence of
risk committees and Board meetings; and risk-related
discussions and analysis. Through regular consideration and
monitoring of these emerging risks early on, we can effectively
respond to potential threats by preparing contingency plans,
implementing mitigation actions and controls, or adjusting our
operations and Group strategy as required.
Executing on our Accelerate+ enablers support the
identification and mitigation of emerging risks and
opportunities such as:
• The continued adoption of AI software coupled with new AI
regulation remains a key area of risk and opportunity that
is emerging.
• The increase in OEM partners and new distribution contracts
through our delivery of Accelerate+ could adversely impact
existing and long-established relationships including the
potential for investment losses due new OEM partners only
seeking a temporary partnership with Inchcape.
• The increase of EV-related parts distribution, as we scale and
optimise our business, continue to challenge our response to
market demand and OEM supply, coupled with continuous
changes in EV-related regulations and incentives.
Also arising in the period are tariff tensions following the US
administration imposing potential incremental tariffs on
Canada, Mexico and China. Although early days, the
interconnectivity of the global automotive supply chain could
be impacted in the future, resulting in rising costs for our OEMs
which in turn could impact on our margins and customer base.
We will monitor the evolution of this geopolitical risk across the
Group, whilst also continuing to ensure risks to our product
portfolio mix are managed including effective and nimble
sales and operational planning.
Board and management risk oversight
The Board is ultimately accountable for establishing and
maintaining the risk management and internal control
framework, and for managing risks to be within acceptable
levels. During 2024, The Board, Audit Committee, and Group
Executive Team carried out the following reviews:
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Board
Audit Committee
Group Executive Team
Q1 • Legal and regulatory: FCA S166
• Materiality assessment
• Risk policy review and approval
• Risk Management 2024 priorities
• Internal Controls: financial reporting, fraud,
technology systems
• Viability
• Vehicle repurchase framework
• Legal & Regulatory: FCA S166
• Emerging risks review
• Regional and Group risk profiles and
mitigations
• Derco integration
Q2 • Strategy: macro and automotive industry
trends, electrification, customer behaviour,
OEM landscape, Scale, Optimise, and new
vehicle categories
• Post-investment review: Morrico
• Business continuity
• Risk management quarterly review
• Internal controls: financial reporting, fraud,
and technology systems
• Business continuity
• UK Retail separation
• Cyber security
• Regional update: Americas
• Regional and Group risk profiles and
mitigations
• HSE and well-being
• Strategy delivery
• Projects and programmes
• Derco integration
• Regional half year compliance certifications
Q3 • Half year risk review
• Emerging risks
• Risk appetite
• Digital strategy
• HSE
• Half year risk effectiveness review: processes,
identification, mitigation, and emerging risks
• Internal controls: financial reporting, fraud,
and technology systems
• Legal & regulatory: litigation
• DXP review
• Regional and Group risk profiles
• EV transition: carbon related regulatory and
incentives changes
• People: future skills and retention
• Supply and demand: inventory optimisation
and supply chain disruption
• Emerging risks
• Business resilience
Q4 • Crisis management
• Post-investment review: Ditec and Simpsons
• Legal & regulatory: CSRD readiness
• Finance & Insurance
• Full year risk review, emerging risks, and risk
appetite
• People review
• Full year risk management effectiveness
review: processes, identification, mitigation,
and emerging risks
• Internal control: financial reporting, fraud,
and technology systems
• Ethiopia Market review
• Cybersecurity
• Material controls under provision 29 of the UK
Corporate Governance Code 2024
• Regional and Group risk profiles and
mitigations
• Emerging risks
• FX volatility
• Risk management process effectiveness and
improvement plan
• Cybersecurity: AI and EV transition
VIABILITY STATEMENT
The Directors have assessed the viability
of the Group by reference to the
Group’s current financial position, its
recent performance and forecasts of
future performance, its business model
(pages 11 to 13), strategy (pages 16 to
22), and the principal risks and
mitigating factors (pages 52 to 58).
The Group’s continued viability is dependent upon the
continuation of its relationships with OEM partners. With many
OEM contracts covering three-year terms, three years is
considered a key timeline for new car changeover in mature
retail markets with good personal finance penetration. In
addition to this, the number of Units in Operation up to three
years old is also a key driver of our Aftersales business.
However, as illustrated in the diagram on the next page, a
variety of other time horizons are also relevant to the
management of the business.
The Directors have determined three years to be the most
appropriate period for the viability assessment as they
believe that it strikes a balance between the different time
horizons which are used to manage the business and is a
reasonable period for a shareholder to expect a distribution
business to be assessed over.
Process and scenarios considered
Our financial planning process incorporates an annual
operating plan for the next financial year (2025), together
with financial forecasts/models for the remaining years
covered by the viability assessment. These financial forecasts
consider the Group’s profitability, gearing, cash flows, and
other key financial metrics over the period to December
2027. These metrics are subjected to sensitivity analysis, in
which a number of the main underlying assumptions are
adjusted and tested to consider alternative risk-based
scenarios. Using the Group’s most significant risks, unlikely but
realistic worse-case scenarios are created and their impact
projected onto the three-year projections. These risks are: (i)
loss of a material Distribution contract; (ii) a major cyber
incident; (iii) margin pressure; (iv) macro-economic
conditions incorporating the impact of a reduction in
inventory financing; and (v) the foreign exchange risk. These
risks have been modelled individually and concurrently, i.e.
assuming all five materialise during the three-year period.
Modelling these risks tests the Group’s ability to withstand a
material reduction in revenue (Distribution contract and
macro-economic conditions), a material degradation in
margins (margin pressure), a material reduction in
performance (foreign exchange risk), and the impact of an
unexpected operational expense (cyber attack).
The models assume that a portion of uncommitted inventory
financing facilities is also withdrawn. The testing recognises
that some mitigating actions would remain available to
management to partially mitigate the impact of these risks,
including reductions in operational and capital expenditure.
In the most severe scenario modelled, the test indicates that
the Company would not breach the single financial (interest)
covenant on its committed facilities. Details of the
Company’s financing arrangements can be found in note 22
to the financial statements on pages 171 to 173.
Longer-term prospects
The following factors are considered both in the formulation
of the Group’s strategic plan, and in the longer-term
assessment of the Group’s prospects:
• the principal risks and uncertainties faced by the Group, as
well as emerging risks as they are identified, and the
Group’s response to these;
• the prevailing economic climate and global economy,
and changing customer behaviours; and
• any opportunities through operational simplification and
leveraging technology.
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Viability statement
Based on the outcomes of the scenarios and considering the Group’s financial position and
principal risks, the Directors have a reasonable expectation that the Group will be able to
continue in operation and meet its liabilities as they fall due over the period of their
assessment. The Directors’ statement regarding the adoption of the going concern basis for
the preparation of the financial statements can be found on page 114.
Directors’ approval of the Strategic Report
The 2024 Strategic Report, from pages 2 to 61, were reviewed and approved by the Board of
Directors on 3 March 2025.
Duncan Tait
Group Chief Executive
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Dear shareholder,
I am pleased to present my first Corporate Governance
Report as Chairman of Inchcape plc. I assumed the role in
May 2024 following the retirement of Nigel Stein and I would
like to take this opportunity to thank Nigel for his dedicated
leadership and wise counsel during his time at Inchcape.
Board changes
We welcomed Alison Platt to the Board in January 2024, with
Alison taking over the role of Senior Independent Director
in May. Alison brings a wealth of corporate experience from
a wide range of sectors. Further details of her skills,
knowledge, and experience are given in this report.
Jane Kingston also retired in 2024 after over five years on the
Board and as Chair of the Remuneration Committee and I
thank her for her contribution and support during this time.
Byron Grote became Remuneration Committee Chair
following Jane’s departure.
Overview of the year
From a governance perspective it has been another busy
year, with the publication of the new UK Corporate
Governance Code in January 2024. which comes into effect
from 1 January 2025. We reviewed the changes with the
support of our external advisors at the beginning of 2024 and
will report fully on our compliance in next year’s Annual
Report and Accounts. The most significant area of change
relates to Internal Control and the Audit Committee have
been focusing on compliance with the new provision, which
comes into effect in 2026. Further information is given in the
Audit Committee Report on page 81.
Several key strategic objectives were achieved in 2024
including several OEM contract wins, further integration of
acquisitions made in 2022 and 2023, and the disposal of our
UK Retail business. This disposal completed Inchcape’s
transition to a Distribution only model but in doing so ended
our involvement in UK operations. Given the impact on many
colleagues this decision was not taken lightly, and further
information on the Board’s approach is given in this report.
During the discussions on the UK disposal, the Board had due
regard for the FCA’s review into historical motor finance
commission arrangements which were announced in 2021.
The Board considered the court decisions and the legal
proceedings which are still ongoing and, as part of the UK
disposal, approved an indemnity to be given to Group 1
Automotive, although it remains highly uncertain that
Inchcape will become liable.
Other key areas considered by the Board during the year
include the refreshed Accelerate+ strategy, sustainability,
culture, and pensions. The Board also carried out a
programme of operational deep dives on Digital and Data to
improve its knowledge and understanding in this key
strategic area.
In October 2024, the Board visited Inchcape Hellas in Athens.
The Toyota business has long been part of the Group and it
was good to meet our colleagues, visit their new head office,
and gain a deeper understanding of this successful market.
Further insights into the Board activities are given in the case
studies on pages 72 to 76.
Colleague engagement
During the overseas Board visit, two of our Non-Executive
Directors (NEDs), Nayantara Bali and Byron Grote, facilitated
a colleague engagement session. In addition, Byron Grote
held a Reward Forum with our colleagues from the Americas.
These engagement sessions allow the NEDs discuss the issues
which are important to colleagues and, importantly, what
could be done better.
As a Board, being able to engage with colleagues in this way
gives insight into culture within the organisation. The NEDs also
participated in the Women into Leadership and Aspire
programmes. Further details are given on page 34.
Looking forward
I would like to take this opportunity to thank all Inchcape
colleagues for their hard work during the year. I thank you for
your support in 2024 and look forward to the coming year.
Jerry Buhlmann
Chairman
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Strategic report
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Financial statements
CORPORATE GOVERNANCE REPORT
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GOVERNANCE
STATEMENT
UK CORPORATE
GOVERNANCE CODE
This report describes the Board’s approach
to governance and how it has applied the
UK Corporate Governance Code 2018
(Code). The disclosures provide details of
the activities of the Board and its
Committees throughout the year including
outcomes of the key decisions taken.
A statement of compliance with the Code
is given on pages 107 to 110. The
statement provides cross referencing to
where relevant information is located
within the Annual Report and Accounts.
The new Code was published in January
2024 and is effective from 1 January 2025.
The Company will report on its compliance
with the new Code in next year’s Annual
Report and Accounts, except for Provision
29, which is effective from 1 January 2026.
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Governance
Financial statements
GOVERNANCE AT A GLANCE
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Governance structure
THE BOARD OF INCHCAPE PLC
Collectively responsible for the long-term success of the Company
• Financial
reporting
• Risk oversight
• Internal control
• External and
internal audit
• Remuneration
policy
• Incentive plans
• Performance
targets
• Group strategy
• Operational
management
• Board
composition
• Diversity
• Succession
planning
• Places and Planet
pillars
• Colleague
engagement
• Climate oversight
COMMITTEE REPORT ON
PAGES 81 TO 88.
• Enterprise risk
management
• InControl standards
• Oversight of Group
capital expenditure
Inchcape’s governance framework
The Board has ultimate responsibility for ensuring the long-term success of Inchcape. It sets the purpose,
values, and strategy and ensures the appropriate culture is in place to achieve its strategic aims.
Certain authorities and accountabilities are delegated to the Board’s Committees. Each Committee has its
own terms of reference setting out its role and responsibility, the Board also has a formal Matters Reserved
for the Board. These support decision making and oversight and are reviewed annually to ensure they
remain fit for purpose.
COMMITTEE REPORT ON
PAGES 91 TO 106.
COMMITTEE REPORT ON
PAGES 89 TO 90.
COMMITTEE REPORT ON
PAGES 78 TO 80.
Board skills, experience, and knowledge
The Board recognises the importance of the right mix of skills,
experience, and diversity to deliver the Group’s strategic
objectives and contribute towards long-term success.
Skills were enhanced in 2024 from the appointment of
Alison Platt. During the year, the Board received updates
from external advisors on particular topics, including
corporate governance updates and developments, trends in
the automotive industry, crisis management, and the
Corporate Sustainability Reporting Directive.
EXPERIENCE WE BRING
• Automotive
• Digital
• Emerging markets
• Environmental, social,
and governance
• Finance
• Multinational business
• Remuneration
• Technology
SKILLS ENHANCED IN 2024
• International and UK
Executive capabilities
• Remuneration and
reward
• UK PLC experience
FUTURE SUCCESSION CONSIDERATIONS
• Automotive
• Environmental, social,
and governance
• Digital
• Technology
GENDER
LENGTH OF SERVICE
4
6
5
2
2
1
Female
0 to 2 years
4 to 6 years
Male
2 to 4 years
6+ years
NATIONALITY
ETHNICITY
8
1
1
1
9
British
Asian
Chilean
White
Singaporean
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Board attendance
The table below shows the Board and Committee meetings held during 2024.
Board
Audit
Committee
Nomination
Committee
Remuneration
Committee
Sustainability
Committee
Scheduled
Ad hoc
Scheduled
Scheduled
Ad hoc
Scheduled
Ad hoc
Scheduled
Nayantara Bali*
Jerry Buhlmann***
Juan Pablo Del Río
Byron Grote
Alex Jensen
Jane Kingston**
Sarah Kuijlaars*
Adrian Lewis
Alison Platt*
Stuart Rowley****
Nigel Stein**
Duncan Tait
*
Nayantara Bali was unable to attend the July Board meeting due to personal circumstances. Alison Platt was unable to attend the overseas Board meeting in
October, the Sustainability Committee in December, and the ad hoc Remuneration Committee meeting, and Sarah Kuijlaars was unable to attend the
December Nomination Committee meeting due to prior commitments, respectively.
**
Jane Kingston and Nigel Stein retired from the Board in May 2024.
***
Jerry Buhlmann was appointed as Chairman in May 2024, and therefore stepped down from being a member of the Audit Committee. Jerry was unable to
attend the January ad hoc Nomination Committee due to a prior commitment.
**** Stuart Rowley was appointed as a member of the Remuneration Committee in November 2024.
Board composition and diversity as at 31 December 2024
Board roles
The operation of the Board is supported by the collective
experience of the Directors and the diverse skills and
experience they possess. This enables the Board to reach
decisions in a focused and balanced way, supported by
independent thought and constructive debate.
Trust and mutual respect are the cornerstones of relationships
between the Directors, with a Board dynamic that supports
open and honest conversations to ensure decisions are taken
for the long-term success of Inchcape in full consideration of
the impact upon all stakeholders.
Chairman
Jerry Buhlmann
• Leads the Board and is responsible for its effectiveness
and governance.
• Fosters a culture of inclusivity and transparency by
demonstrating the Company’s values, establishing the
right ‘tone from the top’.
• Guides the Board in shaping long-term strategy, ensuring
alignment with the Company’s purpose.
• Sets agendas and ensures timely dissemination of
information to the Board, to support sound decision
making and allow for constructive discussion, challenge
and debate, in consultation with the Group Chief
Executive, Group Chief Financial Officer, and Group
Company Secretary.
• Responsible for scrutinising the performance of the Group
Executive Team and overseeing the annual Board
performance review process, including identifying
required actions.
• Facilitates contribution from all Directors and ensures that
effective relationships exist between them.
Group Chief Executive
Duncan Tait
• Represents Inchcape externally to all stakeholders.
• Sets the cultural tone of the organisation and ensures that
the Group operates in a way that is consistent with its
purpose and values.
• Facilitates a strong link between the business and the
Board to support effective communication.
• Develops and implements the Group’s long-term
strategy, as approved by the Board, through leadership
of the Group Executive Team.
• Responsible for overall delivery of all strategic objectives,
ensuring that decisions made and actions taken support
the Group’s long-term sustainable purpose.
• Promotes and conducts Group affairs with the highest
standards of integrity, probity, and corporate
governance, in line with our strategic framework
and values.
Non-Executive Directors (NEDs)
• Promote high standards of integrity and corporate
governance.
• Uphold the cultural tone of the Company and monitor
actions to support inclusion and diversity.
• Constructively challenge and assist in the development
of long-term strategy by providing independent insight
and support based on relevant experience.
• Monitor the delivery of strategy by the Group Executive
Team and measure the performance of management
within the risk and control framework set by the Board.
• Satisfy themselves that internal controls are robust and
that the external audit is undertaken properly.
• Engage with internal and external stakeholders and
feedback insights to the Board, including in relation to
colleagues and the culture of the Company.
Senior Independent Director (SID)
Alison Platt
In addition to their responsibilities as a Non-Executive
Director, the SID also carries out the following duties:
• supports the Chairman in the delivery of their objectives;
• acts as an alternative contact for shareholders; and
• leads the appraisal of the Chairman’s performance with
the Non-Executive Directors.
Group Chief Financial Officer
Adrian Lewis
• Develop and implement financial strategies to achieve
the Group’s strategic aims.
• Oversee capital structure and capital allocation policy.
• Lead financial planning and monitor KPIs on financial
performance.
• Ensure accurate financial reporting and compliance.
• Maintain strong internal controls to prevent fraud and
misstatements.
• Represent Inchcape to all stakeholders, including
investors and analysts.
• Support in the implementation and achievement of the
Group’s strategic objectives.
Group Company Secretary
Tamsin Waterhouse
• Ensures sound information flows to the Board in order for
the Board to function effectively and efficiently, in support
of balanced decision making.
• Advises and keeps the Board updated on corporate
requirements and on best practice corporate
governance developments.
• Facilitates a comprehensive induction for newly
appointed Directors, tailored to their individual
requirements, and oversees the Board’s professional
development programme.
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DIVISION OF RESPONSIBILITIES
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BOARD OF
DIRECTORS
The Board is collectively responsible
for agreeing and continually
reviewing the Accelerate+ strategy
to ensure it delivers long-term
sustainable success. The Board is
also responsible for ensuring the
appropriate resources are in place
to deliver the strategic objectives.
COMMITTEE KEY
Audit
Committee
Nomination
Committee
Remuneration
Committee
Sustainability
Committee
Committee
Chair
Jerry Buhlmann
Chairman
Appointed:
March 2017 (Board);
May 2024 (Chairman)
Skills and experience:
Jerry has over 40 years’ experience in
the advertising and media industries.
Jerry joined Inchcape as Non-Executive
Director in 2017, becoming Senior
Independent Director in 2019, before
becoming Chairman in May 2024. He
was formerly CEO of Dentsu Aegis
Network and Aegis Group plc. Jerry is
currently chairman of three private
equity backed digital marketing
agencies: Croud Limited, Dept, and
Hybrid. Jerry is also a member of the
supervisory board of Serviceplan GmbH.
Duncan Tait
Group Chief Executive
Appointed:
July 2020
Skills and experience:
Duncan brings significant international
experience and a wealth of digital and
data experience, a key enabler of the
Accelerate+ strategy. He played a pivotal
role in the Group’s digital strategy with the
development and deployment of the
Digital Experience Platform (DXP) and the
Digital Analytics Platform (DAP), which are
key differentiators for Inchcape. Duncan
was previously on the board of Fujitsu, a
global technology services company with
35,000 people. Duncan has also held
senior roles at Unisys, Hewlett Packard, and
Compaq in a technology focused career
of over 30 years. Duncan is currently a non-
executive director at Agilisys.
Adrian Lewis
Group Chief Financial Officer
Appointed:
May 2023
Skills and experience:
Adrian brings a wealth of financial
expertise across the automotive,
consumer, digital, and retail sectors. He
has been instrumental in driving key
acquisitions, transforming our finance
function and developing the
Accelerate+ strategy. Adrian became
Group Chief Financial Officer in 2023
having joined Inchcape in 2015 as CFO
for the Emerging Markets region and for
APAC. In 2020, he returned to the UK as
Group Financial Controller, before
being appointed as CFO. Prior to his
time at Inchcape, Adrian held a
number of senior finance positions at
Tesco plc. Adrian is a chartered
accountant.
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Alison Platt
Senior Independent Director
Appointed:
January 2024 (Board); May 2024
(Senior Independent Director)
Skills and experience:
Alison has significant business and
international commercial experience
from working for high-profile consumer-
facing companies across the
healthcare, insurance, and property
sectors. Her former membership of
the steering group of the Hampton-
Alexander Review provides strategic
insights on inclusion and diversity.
Alison serves as chair for Hargreaves
Lansdown plc and Ageas UK. Alison
is also a non-executive director and
chair of the Remuneration Committee
for Tesco plc.
Nayantara Bali
Independent Non-Executive
Director
Appointed:
May 2021
Skills and experience:
Nayantara is the designated NED
responsible for workforce
engagement. Nayantara previously
held various senior management
positions in Procter & Gamble over a
28-year period with extensive
experience in APAC. Nayantara is
director and co-owner of ANV
Consulting Pte, and also an
independent director on the boards of
Torrent Pharma, Starhub, and Marico.
Nayantara holds an Economics
degree and a Post Graduate Diploma
in Business Management from the
Indian Institute of Management
Ahmedabad.
Juan Pablo Del Río
Non-Executive Director
Appointed:
January 2023
Skills and experience:
Juan Pablo has held a number
of senior leadership roles across a
range of companies within the
automotive, real estate, and retail
sectors. He served on the board of the
Derco group, the largest multi-brand
automotive distributor in Latin America,
until its acquisition by Inchcape in
2022. Juan Pablo is currently on the
board of Cruzados S.A.D.P. (a
company with shares listed on the
Santiago Stock Exchange) and is
chairman of Sodimac S.A. He was
formerly a board member of Falabella
S.A.
Byron Grote
Independent Non-Executive
Director
Appointed:
January 2023
Skills and experience:
Byron has extensive experience across
a range of leading international
businesses, bringing strategic focus
and financial expertise to the Board.
Byron is currently non-executive director
at InterContinental Hotels Group plc,
and deputy chairman of the supervisory
board at Akzo Nobel NV. Byron was
previously chief financial officer at
BP plc between 2002 to 2011,and has
previously served on the boards of
Anglo-American plc, Standard
Chartered plc, Tesco plc, and
Unilever plc.
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Alex Jensen
Independent Non-Executive
Director
Appointed:
January 2020
Skills and experience:
Alex is Chair of the Sustainability
Committee and was the designated
Non-Executive Director responsible
for workforce engagement between
2021 to 2024. She has considerable
experience in transforming and
growing customer-facing businesses.
Alex is the CEO of National Express UK,
Ireland, and Germany, and also serves
on the board of the charity Mind. Alex
was formerly regional CEO of mobility
and convenience at BP plc. Alex holds
an MA degree in Chinese Studies from
Oxford University, and a Masters from
Stanford University School of Business.
Sarah Kuijlaars
Independent Non-Executive
Director
Appointed:
January 2022
Skills and experience:
Sarah is an experienced international
finance leader, currently serving as
chief financial officer at Tate & Lyle plc.
Sarah has previously been chief
financial officer at De Beers Group
and Arcadis NV, and has held senior
financial leadership positions at Rolls-
Royce Holdings plc and Royal Dutch
Shell plc. Sarah has a Mathematics
degree from Oxford University and is a
Fellow of the Chartered Institute of
Management Accountants.
Stuart Rowley
Independent Non-Executive
Director
Appointed:
July 2023
Skills and experience:
Stuart has a deep understanding
of the global automotive industry
and has extensive international
experience. Stuart recently departed
Ford after more than 30 years’ service,
starting from a finance leader before
transitioning to president and chair of
Ford Europe, and chief transformation &
quality officer. Stuart was formally a non-
executive board member of the
European Automobile Manufacturers’
Association, a lobbying group
representing Europe’s major car
manufacturers, which includes many
of our original equipment manufacturer
partners. Stuart holds a Master’s degree
in Business Administration.
COMMITTEE KEY
Audit
Committee
Nomination
Committee
Remuneration
Committee
Sustainability
Committee
Committee
Chair
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GROUP
EXECUTIVE TEAM
The Group Executive Team (GET)
drives the Accelerate+ strategy
and is responsible for the day-to-day
operations of the Group. It is a
global team of business leaders
that combines a strong focus on
operational excellence with a
wealth of experience in a wide
range of industries.
Duncan Tait
Group Chief
Executive
Appointed:
July 2020
Adrian Lewis
Group Chief
Financial Officer
Appointed:
November 2022
Mike Bowers
Group General Counsel & Chief
Sustainability Officer
Appointed:
October 2015
Skills and experience
Mike joined Inchcape in 2015 as Group
General Counsel. He is a leading
contributor to the Group’s M&A strategy
which has significantly reshaped the
business over the last decade. Mike is
also instrumental in reinforcing and
strengthening legal and regulatory
compliance across the Group. Mike was
appointed Chief Sustainability Officer in
2023 and leads the Group’s sustainability
agenda including ensuring that this is
fully integrated into Accelerate+, and
that we are able to define and
communicate Inchcape’s role in the
mobility transition.
On 1 April 2025, Mike will become
CEO Americas.
Liz Brown
Chief Strategy Officer
Appointed:
February 2023
Skills and experience
Liz has over 20 years’ experience in
consulting, consumer goods, private
equity, and retail. She joined Inchcape
in 2023 from Diageo, the global drinks
manufacturer and distributor, where she
held the role of Group Strategy Director,
leading the development and delivery
of an ambitious strategic and M&A
agenda, including managing over 15
acquisitions and disposals. Prior to
Diageo, Liz held strategic and senior
roles at Currys plc, Royal Bank of
Scotland Group plc, and LEK
Consulting LLC.
On 1 April 2025, Liz Brown will expand her
role and become Chief Strategy &
Sustainability Officer.
Phil Jenkins
Chief M&A Officer
Appointed:
October 2023
Skills and experience
Phil has over 25 years’ business
development and finance experience
in global organisations across both the
automotive and FMCG sectors. Phil
joined Inchcape initially as Chief
Financial Officer for our Americas &
Africa region and has led our global
M&A team since 2021. Under his
leadership, the M&A team have
developed a significant global pipeline
executing multiple acquisitions and
disposals across the Inchcape Regions.
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Helen Cunningham
Chief People Officer
Appointed:
September 2020
Skills and experience
Helen joined Inchcape in 2016 and has
held various positions as Regional HR
Director in the UK, Emerging Markets,
and Americas & Africa, before being
appointed Chief People Officer in 2020,
bringing a combination of deep
functional expertise and strong
operational leadership to this key global
role. Helen has significant M&A and
integration capability playing a
significant role within the business over
several step-change acquisitions
effectively onboarding new teams and
leaders and integrating businesses. She
is also the Executive leader for Global
HSE and Colleague communications.
Ruslan Kinebas
CEO APAC
Appointed:
October 2015
Skills and experience
Ruslan has led key acquisitions with new
and existing OEM partners, and has
overseen the development of our global
Digital Parts Platform. In 2023, he
presided over successful market entries
into the Philippines and Indonesia which
further grew Inchcape’s distribution
businesses in APAC. In his tenure at
Inchcape, he held strategic roles such
as CEO Emerging Markets, and CEO
Americas & Africa. A firm believer of
Inclusion & Diversity, he is the Executive
sponsor of the Inchcape Women into
Leadership programme, helping to uplift
and develop female colleagues into
leadership roles.
Romeo Lacerda
CEO Americas
Appointed:
September 2021
Skills and experience
Romeo joined Inchcape in 2021 as CEO
Americas & Africa. Since joining the
Group, Romeo has overseen the
acquisition of Ditec and Interamericana
Trading Corporation which have
strengthened the Group’s geographic
reach and broadened its relationships
with original equipment manufacturer
partners. Romeo was influential in the
acquisition and led the integration of
Derco, the largest automotive distributor
in Latin America, increasing Inchcape’s
scale in the Americas with a footprint of
over 30 OEMs across 13 markets.
On 1 April 2025, Romeo will become
Chief Commercial Officer, leading the
Digital & Data team and Distribution
Excellence programme, as well as
Value-Added Services.
Glafkos Persianis
CEO Europe & Africa
Appointed:
April 2020
Skills and experience
Glafkos joined Inchcape in 2020 as CEO
Europe. Glafkos was instrumental with
BYD becoming Inchcape’s sales and
aftersales partner in Belgium, Estonia,
Ethiopia, and Luxembourg. In 2022,
Glafkos also assumed responsibility for
operations in Africa. Under Glafkos’
leadership, the Europe & Africa business
has experienced significant organic
market share growth, driving very strong
sales and profitability growth over the
past four years.
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In line with the Corporate Governance Code 2018, the Board
undertakes a rigorous annual review of its performance, its
Committees, and all individual Directors. The review aims to
identify the Board’s strengths and any opportunities for
improvement, as well as highlighting any training and
development needs.
The Board follows a formal three-year cycle for an externally
facilitated annual review. The 2023 Board evaluation was
externally facilitated by Gould Consulting and therefore
the 2024 and 2025 performance reviews will be facilitated
internally by the Chairman and, in relation to the Chairman’s
performance, the Senior Independent Director.
2023 Board performance outcomes
M&A assessment
To focus discussions on the strategic rationale of M&A
opportunities, the Board reports now include enhanced
reporting on OEM partners by segment and geographical
profile, with greater focus on integration synergies, culture,
and risk mitigations. Lessons learned are also discussed by the
Board with more focused post-investment reviews which
include more non-financial information.
Strategic discussion and debate
The Board ensured there was increased time for Board
members to give their thoughts on front-of-mind issues
outside of the meeting agenda to which may shape
strategic discussions. There was also increased focus
on emerging risks during the Board’s discussions on the
Group’s risk profile and appetite in 2024.
Sustainability Committee
The remit of the CSR Committee, and the Responsible
Business framework, was reviewed resulting in a newly
defined Sustainability Committee, whose key responsibilities
include oversight of the Group’s sustainability strategy and
narrative. Further information is given in the Sustainability
Committee Report on pages 89 and 90.
Flow of information from the Committees
The regular updates from the Committee chairs at Board
meeting focus on the significant issues requiring full Board
attention to enable more concise and focused decision
making, and oversight structure.
2024 Board evaluation
For the 2024 internal Board performance review the Directors
completed an anonymous questionnaire covering strategy,
knowledge, succession, risk, culture, and effectiveness. The
questionnaire also included questions relating to the prior
year actions to ensure they have been resolved satisfactorily.
The results of the questionnaire were discussed by the Board
and development actions were agreed.
Overall, the directors considered there to be a good
balance of challenge and support, with constructive
discussion at meetings and the ability to voice differing
viewpoints. The results also showed that the Directors are fully
involved in the strategic direction of the business and there is
a clear understanding of the risks facing the Group.
Additional strategic deep dive sessions were held in 2024
which were well received by the Board and this programme
of enhancing Board knowledge will continue in 2025
The evaluation of each of the Committees was positive with
each Committee being considered well run, effective, and
having good support from key external advisors. The
Remuneration Committee will focus on the development of
a new remuneration policy to support Accelerate+, and the
newly appointed remuneration advisors will play a key role in
supporting the Committee with this.
There are several key areas of focus for the Board and
Committees in 2025 including monitoring the progress of
Accelerate+ following the launch in 2024 and ensuring that
the equity story is clearly understood externally.
Focus in 2025
Actions for 2025 include:
•
define Board priorities for the year to allow greater
focus or discussion during meetings;
•
earlier visibility on succession and talent pipeline,
including Board exposure to high performing
colleagues; and
•
broaden opportunities of the Board to engage with
colleagues across all levels of the organisation.
An update on progress against these actions will be given in
next year’s Annual Report and Accounts.
2024 Board evaluation process
Evaluation Process
PREPARATION
Questionnaires for the Board and its Committees
were developed by the Group Company Secretary
with the Chairman. The questions covered the
thematic areas of the Code and matters relating to
last year’s Board performance review.
COMPLETION OF QUESTIONNAIRES
Online questionnaires were distributed to each of the
individual Board members for completion. The
questionnaires sought feedback on the areas
covered in relation to the Board and all of its
Committees.
COLLATION OF RESPONSES
Individual responses to the questionnaires were
collated by the Group Company Secretary, who
prepared anonymised summaries. These were then
discussed with the Chairman before the main areas
of feedback were reported to the Board, with
suggested actions for 2025.
BOARD DISCUSSION
The findings of the performance review and
proposed actions were discussed by the Board. The
Board agreed a number of actions in response to the
review that would be implemented and monitored
over 2025.
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Section 172 statement
The Directors have exercised their duties under the
Companies Act 2006 throughout the year, including the duty
to promote the success of the Company while having due
regard for the factors under Sections 172(1). The other factors
taken into consideration by the Directors when making their
decisions are outlined on this page.
Many of the decisions the Board make today will shape the
future of the Group, therefore consideration is given to the
long-term implications and the impact on stakeholders.
Agreeing and implementing the strategic objectives means
considering how the Group will need to evolve in order to
achieve its purpose of bringing mobility to the world’s
communities – for today, for tomorrow, and for the better.
Key activities undertaken by the Board are given on pages
73 to 76. These case studies aim to demonstrate how the
Board considers value creation for shareholders, interests of
current and future colleagues, and the impacts of strategic
decisions on communities and the environment in which
Inchcape operates.
Due to the changing nature of the industry and the evolution
of strategy over the longer term, the Board has regard to the
interests of colleagues to make sure they have the training,
skills, and support to enable them to deliver the Accelerate+
strategy. The Board has oversight of the People agenda
which covers all aspects of the colleague value proposition.
Our OEM relationships are of paramount importance and the
length of these relationships is testament to their strength. The
OEMs with which we partner are some of the most foremost
drivers of technological innovation in the automotive
industry, from advances in hybrid and battery electric
drivetrains to future mobility. All these elements are taken into
consideration by the Board when considering acquisitions
and new partnerships as they will be fundamental to achieve
the Group’s purpose.
The sustainability framework was designed collaboratively,
and is owned and delivered by our colleagues around
the Group. Their input has shaped the way the Board
approaches sustainability and reviews the impact of our
operations have on communities and the environment. The
Board’s risk management procedures identify the potential
consequences of decisions in the short, medium, and long-
term so that mitigation plans can be put in place to prevent,
reduce, or eliminate risks to the business and wider
stakeholders. Please see pages 52 to 61 for further details.
It is important to the Board to maintain a reputation for high
standards of business conduct and our colleague and
supplier Codes of Conduct set out the behaviours we expect
which, combined with our Policy Statements on anti-bribery
and corruption and modern slavery, provide a strong
governance framework in which to do business. Both Codes
of Conduct are available at www.inchcape.com.
All shareholders are invited to the Annual General Meeting
and have the opportunity to speak or ask questions on
any aspect of the Group, its leadership, strategy,
and performance.
STRATEGY
• Accelerate+
• Digital strategy review
• Finance & Insurance review
• Capital allocation: share buyback and dividends
• Sustainability: materiality assessment, Sustainability
Report, and preparation for the CSRD
READ MORE ABOUT LAUNCHING ACCELERATE+ ON PAGE 74.
M&A
• Post-investment reviews
• Acquisitions and contract wins
• UK disposal
READ ABOUT THE DIVESTMENT OF THE UK RETAIL BUSINESS ON PAGE 73.
OPERATIONS
• Business continuity and crisis management
• Regional updates: Americas, Europe & Africa, APAC
• People: organisational health and succession
planning
• Transfer pricing
• HSE review
• Principal and emerging risks
• Pension review
• Review of historical commission arrangements
• Annual reviews: insurance, treasury, and tax
READ ABOUT THE OVERSEAS BOARD MEETING ON PAGE 75.
GOVERNANCE
• Matters reserved for the Board
• Board performance review
• Tax strategy
• Risk Policy
• Modern slavery
• Corporate governance updates
• Conflicts of Interest Policy
READ ABOUT COLLEAGUES AND CULTURE ON PAGE 76.
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DIVESTMENT OF
UK RETAIL
OPERATIONS
Supported by evolution of our
Accelerate strategy.
During the year, the Board approved the sale of the Group‘s
UK Retail operations to Group 1 Automotive.
Strategic rationale
As part of its strategic considerations, the Board regularly
reviews the structure of the Group, the Markets in which
it operates, and the value this creates. The rationale for
holding retail in the UK has been challenged by investors in
the past as Inchcape has moved towards a distribution
focused business.
As a Distribution business, Inchcape will generate higher
returns, make Inchcape more capital-light, relatively higher
margin, and highly cash generative.
Retail, however, still has a place in Inchcape as part of its
distribution value chain. It adds commercial value and drives
deeper market understanding and customer insights in
certain Markets. The Group, however, remains focused on
harnessing the capabilities of a differentiated distribution
platform for our original equipment manufacturer (OEM)
partners.
Consideration of stakeholders
When considering the sale, the Board and management
engaged with key stakeholders impacted by the decision:
UK colleagues, OEM partners, and shareholders. Their
feedback was one of positive support for the Board’s
decision.
When considering the impact on our UK colleagues, a key
consideration for the Board was to ensure the new owner
shared our vision for excellence and growth and
demonstrated commitment to the long-term success
of the business. The Board is confident that Group 1
Automotive will be a great home for the UK colleagues.
For our OEMs, being able to provide scale operations is
increasingly important. As Inchcape has increasingly focused
on becoming distribution only, the Board believes a retail
only focused business is better positioned to provide our OEM
partners with a longer-term UK partner.
The Board considered the sale represents a good outcome
for all stakeholders and as an important step in realising our
ambition of being the leading distributor for our partners and
customers worldwide.
The Board would like to express their sincere gratitude to our
former UK colleagues for their service and commitment over
the years, and we know the business will play an important
part in further developing Group 1’s position in the UK
automotive retail market.
Principal decisions and outcomes
•
Sale to a highly respected automotive retailer with
proven operations in the UK.
•
Proceeds from sale: £150m returned to shareholders with
the remaining to invest in future growth, through organic
investment and value-accretive acquisitions.
•
Providing support to colleagues throughout the sale
process to ensure a smooth transition including a clear
and transparent communication process including town
hall meetings for impacted colleagues.
•
Indemnity in relation to historic motor finance
commission.
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January 2024
March 2024
April 2024
May 2024 to July 2024
August 2024
Inchcape announce
strategic review of Retail
operations
Major shareholders and
OEMs engaged on
proposed disposal of UK
Retail
Sale provisionally
agreed with Group 1
for £345m, subject to
regulatory approval
Colleague engagement
and planned systems
separation. Received
FCA approval for the sale
Transaction
completes
LAUNCHING ACCELERATE
Inchcape drives into the future with a refreshed strategy.
Activities of the Board
The Board approved the Accelerate+ strategy during 2024 following a
comprehensive strategic review. Accelerate+ sees an evolution of
Inchcape’s strategic approach, setting out a clear framework to drive
growth over the medium to long-term.
Strategic rationale
The automotive industry has transformed considerably since the
Accelerate strategy was introduced in 2021. Against this fast-changing
backdrop, the Accelerate+ strategy seeks to establish a stronger
Inchcape, working across more markets with more OEMs. It will position
the business to seize new growth opportunities and drive toward a
target of 10% market share in certain Markets, to deliver enhanced
value for our partners.
Consideration of stakeholders
All stakeholders are impacted by the Group’s strategy and during the
Board’s decision making process consideration is given to whether the
strategy supports the Group’s purpose and culture, whether it will provide
long-term sustainable success, the level of risk it is willing to take, resources
available, or needed, and the capabilities required to deliver. The Board
also received analysis from external advisors on macro and automotive
trends, customer behaviour, OEMs, and competitive landscape. All of this is
underpinned by Inchcape’s sustainability ambition.
Principal decisions
• Priority OEMs and Markets.
• New vehicle categories.
• Distribution Excellence and Value Added Services.
SEE PAGES 18 TO 22 FOR FURTHER DETAILS ON ACCELERATE+.
SUSTAINABILITY
Inchcape published its first Sustainability Report, reinforcing
commitment to sustainable growth.
Activities of the Board
Operating and delivering a sustainable strategy is key to the Group’s
purpose. Over the past few years the Group has enhanced its approach to
sustainability, including a focus on Inchcape’s role in the mobility transition.
The Board and its Committees oversee the development and implementation
of the Group’s sustainability strategy and recognise the importance of
sustainability to all stakeholders. At Board level, consideration of sustainable
practices interlinked with the Accelerate+ strategy ensure sustainability is
embedded in our strategic ambitions.
Consideration of stakeholders
Sustainability is increasingly important to stakeholders because it impacts their
interests and long-term outcomes. The Board considers the impact on
investors in terms of long-term value creation, risks, and market demand. For
customers, the Board considers how our role in the mobility transition supports
their needs. For colleagues, the Board considers whether they have the skills
and capabilities to succeed in a rapidly-changing environment and when
considering the communities in which we operate, the Board considers how
to engage them in the mobility transition.
Principal decisions
• Agreeing sustainability ambition
which underpins Accelerate+.
• First standalone Sustainability
Report aligned with the global
reporting initiative.
• Increased engagement and
education programme
for colleagues and investors.
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May 2024
First Sustainability Report is published
www.inchcape.com/sustainability
+
Board knowledge
To continually improve knowledge and understanding,
the Directors undertake deep dive sessions on particular
aspects of strategy. The aim of the sessions is to refresh
and expand the Board’s knowledge and skills. In doing
so, the Directors can contribute to discussions on
technical and regulatory matters more effectively. The
sessions also serve as an opportunity for the Board to
discuss strategy, performance, and risks with
management below the Group Executive Team level
and gain further direct insight into our businesses and
management capability.
During 2024, the teach-in sessions focused on Digital, Data &
Analytics which is a key enabler of Accelerate+. The sessions
looked at the relationship between the value chain, the
customer journey, and how the tech stack supports both.
The sessions also provided a deep dive on the Inchcape
Digital framework, current performance and underlying
economics, and an overview of the route-to-market
transformation journey which consists of Distribution
Excellence and Value Added Services under the
Optimise pillar.
• DXP and DAP covered the digital experience
customer journey and digital analytics tools.
• Digital Marketing covered reputation.com and its
importance as a measure of success for the business,
product planning, and logistics.
• Digital Innovation covered finance and insurance, the
use of AI in delivering customer experience, and
digital tools to improve lead management.
Overseas meeting
The annual overseas Board meeting took place at
Inchcape Hellas in Athens. Overseas Market visits are
crucial for the Board as it allows the Directors to obtain a
deeper understanding of local Market insights, strengthens
relationships with local colleagues, helps inform decision
making on key strategic areas, and aids observation of
operational risks and opportunities.
During the Board’s visit, updates were provided on
financial performance and outlook, the strong relationship
with Toyota, the dealer network, and an overview of the
EU’s new regulations on emissions performance standards.
These updates allow the Board to assess alignment
between the global strategy and local execution and are
a pivotal part of the Board’s calendar.
Pension buy-in
The Group sponsors several pension schemes that represent
attractive benefits for existing and past colleagues, including
the Inchcape Motors Pension Scheme (IMPS), a UK defined
benefit scheme which is by far the most material.
The Board understands it is their responsibility to ensure the
pension schemes are operated effectively for the benefit of
members and shareholders.
During 2024, the Board endorsed a buy-in plan of IMPS which
was successfully completed by the scheme trustee in
November 2024.
When reaching its decision on whether the buy-in was in the
best interests of stakeholders, the Board adhered to its core
pension principles to:
• assure the delivery of scheme benefits to members;
• have an operating model that runs smoothly,
efficiently, and effectively providing an excellent
service to members;
• leverage Inchcape’s covenant, and the scheme assets,
for the benefit of all members and ensure they are
treated equitably;
• minimise the risk of unexpected cash calls, whilst
maintaining sufficient return to meet long-term
objectives; and
• operate the scheme in a manner that is mindful of the
Company’s purpose and approach to environment,
social, and governance matters and stewardship.
The Board understood that the buy-in should be endorsed as
it would provide enhanced security for members while
reducing balance sheet risk for the Company.
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PEOPLE AND CULTURE
The One Inchcape Values & Behaviour culture is a big part of the Group’s success. The values help
drive business performance by improving how we do things and help us make better decisions.
Monitoring culture
There are several mechanisms in place by which the Board
monitors the culture of the Group including:
Organisational health review
The Board agenda includes regular discussions on the
Group’s health. These reviews assess the organisation’s
capability to function effectively, adapt to change, and
sustain high performance over time.
The Board reviews and evaluates:
•
effectiveness of leadership;
•
colleague engagement;
•
talent and development; and
•
Inclusion & Diversity.
Be Heard survey
The results of the 2024 Be Heard survey are presented to the
Board on annual basis with a follow up during the year to
enable the Board to monitor the progress being made on
improvement action plans.
The Board considers the results compared to prior year giving
consideration to those areas which have seen a decrease in
satisfaction or engagement and analysing the root causes
for any changes.
Speak Up
The Group’s whistleblowing helpline is strong indicator of the
Group’s culture and reflects a commitment to transparency,
accountability, and ethical behaviour. The Audit Committee
reviews the reports made to the helpline at each meeting.
Embedding culture
The Board takes a proactive approach to ensuring culture
is embedded throughout the organisation.
Inclusion and diversity (I&D) initiatives
All Non-Executive Directors have been, or are scheduled
to be, guest speakers at the Women into Leadership
programme. The Directors are able to talk about their
careers, the challenges they have faced, and the
personal journeys which have defined who they are.
The sessions are designed to be interactive with most of the
time allocated to Q&A to allow the cohorts to share their
experiences in a nurturing environment.
DNED engagement and reward forums
The designated Non-Executive Director engagement session
takes place during the Board’s overseas visits and consist of
an open forum without management. As with the I&D
programmes, the sessions are designed to be conversational
so colleagues can speak about the issues which truly matter
to them. It also provides the Non-Executive Directors to ask
colleagues about whether they see their own experiences
reflected in the Be Heard survey results and whether they feel
the strategy is moving in the right direction.
Individual meetings
One-to-one sessions also take place with the People team
to allow the Non-Executive Directors to discuss organisational
topics outside of the Board agenda.
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Bringing mobility to the world’s communities for
today, for tomorrow, and for the better.
Building a stronger, more diversified company
that generates sustainable growth for our OEMs
and for our investors, and opportunities for our
colleagues to grow and thrive.
Our culture is built by effective teamwork, fresh
thinking, a focus on delivery, and putting our
colleagues, OEM partners, and customers at the
centre of everything we do.
OEMS & CUSTOMERS
How we engage
Engagement with OEMs and customers is primarily
conducted by members of the Group Executive Team
(GET) who provide updates to the Board. During 2024, the
GET met with Toyota, Subaru, Suzuki, and Hino in Japan.
The Group General Counsel & Chief Sustainability Officer
also joined the visit which provided an opportunity to
share Inchcape’s sustainability strategy with the OEMs.
This provided an opportunity for management to meet
the OEMs sustainability teams and to gain a deeper
understanding of their ambitions.
The purpose of the meetings is to share strategic
objectives, local market insights, and best practice.
The outcomes of the discussions input into the Board’s
strategic discussions. The strengthening of these
relationships also leads to even more distribution
opportunities as Inchcape proves itself to be a leading
distribution partner in smaller more complex markets.
In addition to regular executive level engagement, a
former executive from Mercedes-Benz joined the Board
as a guest speaker at the annual Strategy Day.
Discussions included approach to electrification,
evolution of customer behaviour, and connected,
autonomous, and shared mobility trends. This insight
provides the Board with a well-rounded view of the
automotive sector which is taken into account when
setting strategy.
COLLEAGUES
How we engage
The GET is responsible for day-to-day engagement
delivered through a comprehensive annual
communications and engagement plan. Direct Board
engagement consisted of sponsorship, mentoring, and
colleague engagement sessions and forums. The sessions
are designed to evaluate current engagement
strategies, employee sentiment, and operational
challenges. Themes raised during the 2024 Board
engagement sessions will feed back into management’s
future engagement plans and include:
•
Sustainability strategy: strong interest in understanding
Inchcape’s sustainability journey with a focus on its
alignment with both current and future OEM product
line-up versus incoming regulation.
•
Brand identity and pride: clarity on Inchcape’s brand
identity with emphasis on internal and external
brand alignment.
•
Career development and global mobility: recognised
potential to increase awareness and access to
global career pathways within
Inchcape's ecosystem.
•
System alignment: feedback potential inefficiencies
and highlighting areas for improvement in project
follow-through and completion.
FURTHER INFORMATION ON PEOPLE AND CULTURE CAN BE FOUND ON
PAGE 76.
SHAREHOLDERS
How we engage
During 2024, Jerry Buhlmann met with eight shareholders
prior to his appointment as Chairman. These shareholders
represent 27% of Group’s share register, with the meetings
providing shareholders with an opportunity to share views
on the business and discuss relevant corporate
governance matters. In addition, Byron Grote contacted
shareholders upon his appointment to Chair of the
Remuneration Committee asking for any views or
comments on remuneration at Inchcape.
Feedback from these meetings are discussed with
the Board, with shareholders remaining supportive
of Inchcape’s strategy, performance, and
executive management.
The Board welcomes the opportunity to meet with
shareholders at the Annual General Meeting, which
provides the opportunity for all shareholders to ask
questions to the Board on the matters put to the meeting,
including the Annual Report and Accounts. The Notice of
the AGM is sent to shareholders and is also available at
www.inchcape.com.
The ‘In the driving seat’ webinars continued in 2024. The
first session was on the Distribution model focused on
commercial and financial dynamics, technology, OEM
partners, and the benefits through Value Added Services,
and the second was a live event providing a deep dive
on the Accelerate+ strategy and the APAC region. These
events were very well received by investors and can be
found on our website.
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Chair of the Board
The role of Chair is to provide leadership and guidance and
to ensure the Board functions effectively. Therefore the
recruitment and selection process for this role is a key
responsibility for the Nomination Committee. As detailed in
last year’s Annual Report and Accounts, Byron Grote ran the
Chair succession process following which, in May 2024, I was
appointed to succeed Nigel Stein.
One of the primary considerations for the Committee was to
ensure continuity of leadership as the Group continues to
execute the Accelerate+ strategy. As I have been on the
Board since 2017, and Senior Independent Director since
2019, the Committee felt that I had the requisite skills and
experience to perform the role of Chair and I was delighted
to accept the position.
Before making their recommendation to the Board, the
Committee considered my length of service, and the
provision of the UK Corporate Governance Code, noting
that the maximum term of nine years preserves
independence. The Committee agreed that retaining
continuity and stability to help maintain stakeholder
confidence is critical as the strategy evolves, therefore
deemed that despite serving on the Board for over six years,
this was not a factor in assessing my independence.
Board composition and succession planning
Alison Platt was appointed as Non-Executive Director in
January 2024 and then become Senior Independent Director
following my appointment as Chair. Alison brings significant
business, commercial, and listed company experience from
executive and non-executive roles in a range of sectors
including healthcare, insurance, and property. Her former
membership of the steering group of the Hampton-
Alexander Review also provides the Committee and the
Board with strategic insights on inclusion and diversity.
Following nearly six years on the Board, Jane Kingston
stepped down from the Board prior to the 2024 Annual
General Meeting. Following this retirement, the Nomination
Committee proposed that Byron Grote be appointed as the
next Chair of the Remuneration Committee with effect from
May 2024. The Nomination Committee discussed the skills,
knowledge, and experience required to lead the
Remuneration Committee and agreed that Byron has the
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Committee snapshot
What we did
Outcome
Inclusion & Diversity
Reviewed progress against
plans for I&D initiatives and
achievement of targets
Board composition and
succession planning
Appointment of new
Chair and Senior
Independent Director
Board performance
review
See page 71 for more
information.
The Committee’s terms of reference can be found at
www.inchcape.com
Dear shareholder
I am pleased to present the report
of the Nomination Committee for
the year ended 31 December 2024.
The aim of this report is to provide
an overview of how the Committee
has discharged its duties and I
hope you find it useful.
Meeting attendance
Scheduled
Ad Hoc
Jerry Buhlmann (Chair)
Nayantara Bali
Juan Pablo Del Río
Byron Grote
Alex Jensen
Sarah Kuijlaars**
Alison Platt
Stuart Rowley
Jane Kingston*
Nigel Stein*
n Number of meetings attended
n Number of meetings
* Jane Kingston and Nigel Stein retired from the Board in May 2024.
** Sarah Kuijlaars was unable to attend the December meeting and Jerry
Buhlmann was unable to attend the ad hoc January meeting due to prior
commitments, respectively.
Jerry Buhlmann
Chair of the Nomination Committee
requisite experience. Byron has been a member of the
Remuneration Committee since January 2023 and also
serves on the remuneration committee of Intercontinental
Hotels Group plc, as well a previously being a member of the
remuneration committee for Tesco plc. The Nomination
Committee recommended this appointment to the Board,
and this was approved in February 2024.
The Committee monitors Board composition and its
succession plans on an on-going basis, and a key element of
this review is the assessment of skills, experience, and
knowledge. The appointments to the Board over the last two
years have further strengthened financial, automotive,
multinational, environment, social, and governance
experience, and following the assessment of skills,
experience, and knowledge during the year, the Committee
determined digital and technology as a key knowledge area
for consideration when determining suitable candidates to fill
vacancies on the Board as they arise.
The Committee believes the composition enables the Board
to optimally perform for the benefit of shareholders and
ensures that the Board and its Committees are well
equipped with the skills and capabilities needed to drive the
future success at Inchcape.
The outcomes of the Board’s performance review is given on
page 71. The contributions of individual directors during the
year are given in the notice of Annual General Meeting,
accompanying the resolution to re-elect.
Length of service, time commitments, and other
appointments
It is usual for Board members to serve a maximum of nine
years on the Board, and length of service is taken into
account when looking at succession planning. The
Committee reviews length of service on an annual basis and
recommends to the Board the appointment of Non-
Executive Directors (NEDs) for a further three-year term as
and when they arise. However, there may be occasions
when a Director may resign before they have completed
nine years’ service. In these circumstances, a longlist of
potential candidates is continually kept up to date so the
appointment process can begin immediately to fill
vacancies as they arise.
The Nomination Committee considers suitable candidates to
fill vacancies or where it could be deemed that another NED
would enhance the performance and experience of the
Board on a continual basis.
The time commitment expected of NEDs is set out in their
Letter of Appointment and is reviewed as part of the Board
performance review process. The Board’s policy on multiple
Board appointments takes into account guidance from
investors and proxy advisors, and provides the criteria of the
type and of appointment considered acceptable and the
approval process to be followed before accepting a further
external directorship. The Committee reviews the
policy annually.
Director independence
The Committee assesses the NEDs’ independence on
appointment and throughout the year. NEDs are required to
inform the Committee of any situation which could impair
their independence and report on any potential conflicts of
interest at each meeting.
Juan Pablo Del Río is not considered independent as he has
a significant shareholding in the Company and has close ties
with the Derco business acquired in 2022. The Company
acknowledges that Juan Pablo Del Río is not independent
but the rationale behind the Derco acquisition, as stated in
the 2022 Annual Report and Accounts, is of tremendous
benefit to the Company in growing the Americas Region
and bringing highly complementary OEM relationships. As he
is not considered independent, Juan Pablo has no voting
authority when it comes to making decisions concerning the
Derco subsidiaries.
Appointments to the Board and induction process
When planning to fill future vacancies, an appropriate job
specification is developed, along with specification of any
other desirable attributes required. A longlist of candidates
will be considered after which a shortlist is agreed, and the
interview process begins.
Potential candidates meet with the Chair, Senior
Independent Director, and other Board members. Once a
preferred candidate has been identified, the Committee
makes its recommendation to the Board for approval. During
the recruitment process a comprehensive assessment is
conducted to evaluate each candidate’s capability,
strengths, and personal attributes needed to complement
and enhance the skills, experience, and knowledge of the
Board members. The Lygon Group were appointed to assist
with the recruitment of Alison Platt. Lygon Group are
signatories of the standard voluntary code of conduct for
executive search firms and has no other connection to the
Company or any individual Director.
Induction of Non-Executive Directors
The induction process is designed to provide new Directors
with a detailed understanding of the business and the
Group’s future strategic ambitions to enable them to perform
their duties as Directors of the Company. This includes
meetings with the Group Executive Team (GET), key
management, and the Group’s principal advisors. All Board
members are provided with a comprehensive pack of
documents setting out key information about the Company,
including broker reports on the Company and
industry sector.
As part of her induction, Alison Platt attended a site visit at
the Mercedes-Benz dealership in Oxford. Visiting sites and
meeting colleagues helps provide an overview of our
operations as well as Inchcape’s ways of working, culture,
and values. Alison also had individual introductory sessions
with GET members and other senior leaders to help
understand each departments’ role within the business.
There were also meetings with external advisors, such as the
external auditor prior to joining the Audit Committee, and the
remuneration advisors in preparation of joining the
Remuneration Committee.
Diversity
The Committee considers the recommendations under the
Parker Review as part of its commitment to improving
diversity throughout the organisation. There are several
initiatives in place to support the achievement of diversity
targets including the Women into Leadership programme
and the newly launched Aspire programme which targets
female talent deeper within the organisation at an earlier
stage of their careers.
Jerry Buhlmann
Chair of the Nomination Committee
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Diversity within Inchcape
We are passionately committed to promoting inclusion, diversity, and equality in the workplace
and it is inextricably linked to our strategy. We value diversity in the broadest sense including,
but not limited to age, disability, ethnicity, gender, sexual orientation, or educational,
professional, and socio-economic backgrounds. The objective of ensuring a diverse Board
is to provide fresh perspectives which enrich our decision making and the aim of the policy
statement is to reflect this ethos.
As at 31 December 2024, 28% of senior leadership positions were held by women. The target is
to achieve at least 30% female representation at senior leadership level by the end of 2025.
The Board and its Committees are subject to the Group’s Global Inclusion & Diversity Policy,
which is reviewed annually and is available on the Company’s website at www.inchcape.com.
The policy is implemented during the nomination process where all aspects of diversity are
valued along with the range of skills, experience, and knowledge needed to enable the Board
to make the right decisions to achieve the objectives of the Accelerate+ strategy and to
create long-term sustainable success.
As at 31 December 2024, the Company meets the diversity targets under UK Listing Rule 6.6.6(9)
where 40% of the Board were women, the Senior Independent Director role is held by a
woman, and one member of the Board is from a minority ethnic background.
Our goal is to maintain or improve the representation of ethnic minorities in senior
management, as well as to improve the proportional representation of ethnic minorities to
better reflect the global communities in which we operate. One of our core themes for our
Inclusion & Diversity strategy in 2025 is ethnicity and culture which aims to cultivate an
environment that celebrates diverse cultural backgrounds and ethnicities, foster cross-cultural
understanding, and explore the nuances of ethnicity within our global community.
Diversity data is collected through our global HR system which enables self-identification
through a multiple-choice dropdown with the same definitions as used under UK Listing Rule 6
Annex 1. Colleagues are also invited to submit their disability information, sexual orientation,
and religion through the system. We roll out communications and campaigns annually to
encourage full disclosure in Markets where we can ask and collect data.
All Board directors are asked directly to confirm to submit their ethnicity data on an annual
basis to enable the Group to make the necessary disclosures.
Gender identity or sex
Number of
colleagues
Percentage
of
colleagues
Number of
Board
members
Percentage
of the
Board
Number of
senior
positions on
the Board*
Number in
executive
management
Percentage
of executive
management
Men
12,378
70%
6
60%
3
48
72%
Women
5,198
30%
4
40%
1
19
28%
Other categories
5
0%
0
0%
0
0
0%
Not specified/
prefer not to say
7
0%
0
0%
0
0
0%
Ethnic background
Number of
Board
members
Percentage
of the
Board
Number of
senior
positions on
the Board*
Number in
executive
management
Percentage
of executive
management
White British or other White
(including minority-white groups)
9
90%
4
48
71%
Mixed/Multiple ethnic groups
0
0%
0
3
5%
Asian/Asian British
1
10%
0
9
13%
Black/African/Caribbean/Black British
0
0%
0
1
1%
Other ethnic group
0
0%
0
3
5%
Not specified/prefer not to say
0
0%
0
3
5%
* Senior positions include the Group Chief Executive, Group Chief Financial Officer, Senior Independent
Director, and the Chairman.
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Sarah Kuijlaars
Chair of the Audit Committee
The Committee plays a key role in the Group’s governance
framework providing independent challenge and oversight
across financial reporting and internal control procedures.
The Committee members use their skills, knowledge, and
experience to bring an independent mind-set to the
deliberations which results in the collective view being
expressed to the Board.
The Committee held five scheduled meetings throughout the
year discussing its key areas of oversight: financial reporting,
internal control and risk management, compliance,
whistleblowing, and fraud, in addition to internal and external
audit. The Committee consists solely of independent Non-
Executive Directors, with the Chairman, Executive Directors,
and members of the management team in attendance.
The performance and effectiveness of the Audit Committee
was assessed during the 2024 Board evaluation. Please see
page 71 for more information.
Changes to the Committee
I was delighted to welcome Alison Platt, who joined the
Board in January 2024, to the Committee. As detailed on
page 62 of the Corporate Governance Report, Alison has
extensive corporate experience which will be a valuable
contribution to our discussions.
With regards to recent and relevant experience on the
Committee, I have held several senior finance roles, currently
as chief financial officer of Tate and Lyle plc and I am a
Fellow of the Chartered Institute of Management
Accountants. Of the other Committee members, both Byron
Grote and Stuart Rowley have a wealth of financial
knowledge and experience gained in large multinational
organisations in various sectors. Byron Grote also serves as the
audit committee chair of InterContinental Hotels Group plc.
UK Corporate Governance Code (Code)
The FRC published the updated Code in January 2024
(effective from 1 January 2025). The Committee spent time
during the year considering Provision 29 (effective from 1
January 2026) which requires the Board to monitor and
review all material controls, including financial, operational,
reporting, and compliance controls.
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Dear Shareholder
I am pleased to present the Audit
Committee Report for the year
ended 31 December 2024. The aim
of this report is to provide an
overview of how the Committee has
discharged its responsibilities during
the year and to highlight the
significant issues considered by
the Committee.
Committee snapshot
What we did
Outcome
Financial reporting
Publication of full and half year
results
Internal control
Improved control environment
and Provision 29 readiness
Risk management
Focus on effectiveness of risk
management framework
Internal audit
Monitoring of 2024 IA plan
throughout the year
External audit
Review of effectiveness of
external audit and assessment
of auditor’s independence
The Committee’s terms of reference can be found at
www.inchcape.com
Meeting attendance
Scheduled
Sarah Kuijlaars (Chair)
Byron Grote
Alison Platt
Stuart Rowley
Jerry Buhlmann*
n Number of meetings attended
n Number of meetings
* Jerry Buhlmann was appointed as Chairman in May 2024 and
stepped down from being a Committee member.
The definition 'material control' is not given in the new Code,
therefore it is for each individual company to determine. As
such the Committee undertook a comprehensive review of
material controls during the year which included an
assessment of what Inchcape define as material controls, the
process to identify these controls, and establishing a
proposed framework to manage material controls.
Leveraging on the Group’s risk management matrix, the
Committee reviewed the events which could impact the
long-term sustainability and viability of the Group to assess
whether the design of any material controls need to be
amended or improved.
The plan for 2025 includes understanding the level of control
monitoring currently undertaken by the Board or relevant
Committee and alignment of roles and responsibilities to
ensure that effectiveness of material controls are
appropriately assessed and monitored to enable the Board
to report on the effectiveness in compliance with the new
Code. A further update will be given in next year’s Annual
Report and Accounts.
Other regulatory matters
The Committee also considers compliance with relevant
accounting standards and other regulatory financial
reporting requirements including the EU Corporate
Sustainability Reporting Directive (CSRD).
Under CSRD, the Committee will have specific responsibilities
on ensuring the integrity of sustainability reporting and
oversight of any assurance over that reporting. Deloitte have
been appointed to provide assurance over our CSRD
reporting and a further update on the Committee’s activities
in relation to CSRD will be provided in next year’s Annual
Report and Accounts.
Regional updates
Regular updates from Regional CFOs have been added to
the Committee’s agenda, with an update received from the
Americas in 2024. Regional updates allow the Committee to
obtain deeper insight into regional issues, and to take a more
granular view of risks and opportunities facing the Markets.
The Americas have seen a significant amount of M&A in the
past few years and the review provided a detailed
assessment of the integration of the new businesses, the
control environment, and the on-going systems
implementation in the Markets.
The regional CFO from the Europe & Africa region provided
an in-depth overview of the Ethiopian market during the
year. The Committee considered Market expectations,
financial performance, liberalisation of the market, and the
accounting considerations and impacts in respect of
hyperinflation and cash held in the Market.
Internal control
The Committee also considers the effectiveness and
application of internal financial controls throughout the year,
receiving reports on compliance, control gaps, new business
integration, and controls improvement and a key focus area
for the Committee during 2024 was IT General Controls.
With the progression of the Accelerate+ strategy, and the
introduction of the Digital Delivery Centres (DDCs), the risk is
shifting from local IT teams to global specialists. To ensure
effective controls are in place, the Committee spent time
reviewing the platform and market effectiveness certification
and improvement programmes. I am pleased that good
progress is being made in this area with the control framework
refreshed and aligned with the NIST security framework.
Global Business Services (GBS)
In 2021, the Group began a finance function transformation
programme which consisted of the formation of GBS. The
implementation of GBS is to standardise and consolidate
core accounting processes, add additional controls, and
provide a platform to support M&A integration.
Following the sale of the UK Retail business, a review of the
GBS requirements was carried out to ensure the scope and
scale of the services were providing value for the Regions
and Markets. The outcome of this review resulted in a project
to leverage the Group’s DDC infrastructure to build an in-
house finance delivery centre to deliver core financial
services. This programme has commenced for the Americas
and will be followed by APAC in 2026.
The Committee will continue to monitor the design and
implementation of the processes and controls to ensure the
anticipated level of improvements and standardisation, and
the expected cost reductions, are delivered. In addition, the
Group Chief Financial Officer provides regular progress
updates to the Board.
Cybersecurity
Cybersecurity continues to remain one of the most significant
risks to the Accelerate+ strategy. The Chief Information
Security Officer provides an update on cybersecurity twice a
year, with ad hoc updates as needed. These reports provide
the Committee with information on NIST progress, cyber
monitoring, and any notable incidents. The cyber teams
have continued to make good progress on the cybersecurity
projects in 2024, and a NIST maturity rating of 3.1 has been
achieved which demonstrates the strong progress being
made in this area.
The Committee also reviews the controls in place to defend
against cyber threats, to assess the cyber risks to the
organisation, and to establish whether the controls in place
are effective. During 2024, there were four cyber incidents of
note, none of which resulted in a material impact on the
business, and all of which have been resolved. The
Committee reviewed each of the incidents in detail,
including any subsequent mitigation plans agreed with the
management teams. The Committee also spent time
discussing the cyber roadmap for 2025 which includes
continuing to mature the Group’s cyber posture, assessment
on ability to mitigate an attack and on-going security
measures for the third party network.
Other areas of consideration
Further information on the responsibilities of the Committee
can be found throughout this report:
• Significant issues;
• Fair, balanced, and understandable;
• Financial reporting;
• Risk management and internal control;
• Internal audit;
• Whistleblowing;
• External audit; and
• Non-audit services.
Sarah Kuijlaars
Chair of the Audit Committee
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Significant issues considered by the Committee during the year
Impairment
- see notes 10 to 12 on pages 156 to 162
Impairment reviews are conducted annually in respect of
goodwill and indefinite life assets, and if there is an
indicator of impairment, reviews are implemented more
frequently. In addition, other intangible assets, property,
plant and equipment, and right-of-use assets are reviewed
for impairment if events or circumstances indicate that the
carrying value may not be recoverable. This is a
judgemental process which requires estimating future cash
flows based on future business prospects, determining long-
term growth rates, and discount rates.
It is the Committee’s view that management’s approach
to impairment is robust, based on reliable supporting data
from external sources where relevant, and with appropriate
challenge from the external auditor.
During the year, the Committee considered the following:
• The appropriateness of the cash generating units
(CGUs) or groups of CGUs used for impairment and the
allocation of assets and cash flows thereto;
• The cash flow projections used to calculate the value in
use, considering whether these reflect a reasonable
expectation of future performance;
• How management had determined the discount rates
and long-term growth rates;
• The impact of climate change, including electrification
on impairment and the impact of electric vehicles
on aftersales;
• The reliability of data provided by external advisors and
independent specialists used in key assumptions; and
• The appropriateness of the disclosures to be made in the
Annual Report and Accounts to satisfy itself that they
provided users of the financial statements with sufficient
information to understand the judgements made by
the Group.
After considering all available information and reviewing the
findings, the Committee concluded that management’s
impairment reviews of non-financial assets were appropriate.
Disposal of UK Retail
- see note 28 on page 186
The Group disposed of its UK Retail operations in August
2024 to Group 1 Automotive UK Limited, a wholly owned
subsidiary of Group 1 Automotive, Inc. for cash
consideration of approximately £345m.
During the year, the Committee considered the
following judgements:
• The criteria required to be met to classify the UK Retail
operation as a discontinued operation;
• The allocation of revenue and expenses to the
discontinued operation, considering whether the Group
would no longer be entitled to the revenue or incur the
expense following the disposal;
• The consequences of the disposal on reporting segments;
and
• The presentation of the results of the discontinued
operation and the gain on disposal in the
financial statements.
After reviewing the accounting judgements presented by
management and considering the view of the external
auditor, the Committee concluded that the disposal should
be classified as a discontinued operation, and as the only
remaining operation from the ‘Retail’ reporting segment is
a relatively small operation in Poland, this be combined
within ‘Europe and Africa Distribution’ segment and the
Group will no longer report a ‘Retail’ segment.
Pension buy-in
- see note 5 on pages 148 to 152
In November 2024, the Trustees of the Inchcape Motors
Pension Scheme completed a buy-in transaction whereby
the assets of the scheme were used to acquire a bulk
purchase annuity policy with Legal & General under which
the benefits payable to the members of the scheme are
now fully insured. The insurance policy was purchased using
the existing assets of the scheme.
The Committee reviewed the reports provided by both
management and the pension advisors for both the
Company and the scheme trustee and considered the
following accounting judgements:
• The asset value of insured benefits was set equal to the
associated pension liabilities in accordance with IAS 19,
Employee Benefits; and
• Whether the purchase of the annuity contract was a
settlement as defined in paragraph 8 of IAS 19 which is a
transaction that eliminates all further legal or constructive
obligations for part or all the benefits provided under a
defined benefit plan.
The Committee concluded that the buy-in, which had
resulted in a reduction in the value of scheme assets, had
been appropriately recognised as an asset loss through
other comprehensive income as it was not considered a
settlement but an investment decision by the scheme
trustee which had not eliminated the obligation to provide
benefits to members.
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Fair, balanced, and understandable
The Audit Committee carried out its own assessment of the
financial statements, and the Annual Report and Accounts
as a whole, and is satisfied that it provides the necessary
information for shareholders. In carrying out this review the
Committee considered:
• If the information disclosed is open and honest.
• Are any weaknesses or challenges disclosed as well as
successes and opportunities.
• Are issues considered of significant risk by both the
external auditor and the Committee aligned.
• Are key performance indicators linked to strategy clearly
explained and give a true indication of the health of
the business.
• Is the business model and strategy explained in a clear
and concise manner.
• Is the tone of the Annual Report consistent, the format
easy to read, and any signposting to additional
information clear.
The processes and procedures in place to satisfy the Board
of the integrity of the financial and narrative statements
include a robust disclosure verification process, monthly
financial performance updates, and meetings with the
internal and external audit functions without the presence
of management.
The Company’s business model and strategy are set out on
pages 11 to 22 and a statement of the Directors’
responsibilities is set out on pages 114 to 115 which includes
the going concern statement.
During the year the Committee:
• Considered the key audit issues, accounting treatment,
and judgements in relation to the financial statements.
• Where risks were identified, either in relation to processes,
key transaction, or colleagues, undertook a deeper dive
review of matters, challenging management to improve
the control environment, and tighten processes.
• Challenged management on the assumptions used and
the judgements that have been applied, with assurances
given from both external and internal sources.
• Assessed whether the Annual Report and Accounts are
fair, balanced, and understandable.
Following its review, the Committee confirmed to the Board
that the 2024 Annual Report is fair, balanced and provides
sufficient clarity for shareholders to understand our business
model, strategy, financial position, and performance
Financial reporting
The Committee provided oversight by reviewing the half-
year and annual financial statements, taking into account:
• the quality and acceptability of accounting policies
and practices;
• material areas in which significant judgements have been
applied or discussed with the external auditor;
• the clarity of the disclosures and compliance with financial
reporting standards and relevant financial and
governance reporting requirements including the Code;
• any correspondence from regulators in relation to the
Group’s financial reporting; and
• reviewing assumptions and assurance to support the long-
term viability statement.
The Committee conducted its work using information
supplied by management, the external auditor, and other
advisors as appropriate. During the year, the Committee
received reports from the Group Financial Controller and the
Group Head of Reporting on impairment, adjusting items,
acquisition and disposal accounting, and pension
scheme liabilities.
Regular updates are also received from the Group Tax
Director during which the Committee reviewed the Group’s
effective tax rate, deferred tax, and tax audits and
settlements. The Committee also spent time considering the
assessment of its exposure to the OECD’s Pillar Two legislation,
and the processes being implemented to comply with
regulations. The processes are being developed by a cross
functional working group to manage the implementation.
Further information is given in the tax note on pages 153 to
154 of the financial statements.
The Committee also spent time reviewing the forecasts,
projections, and assumptions used in determining whether
the Group is able to adopt the going concern basis of
accounting in preparing the financial statements.
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Risk management and internal control
The Board has overall responsibility for the Group’s risk
management and internal control framework
including ensuring:
• there is an appropriate mechanism in place to identify the
risks the Group faces;
• management teams focus on those risks and action plans
are in place to mitigate or respond to those risks;
• a compliance programme is in place that meets or
exceeds external benchmarks and is appropriate in terms
of legal requirements, content, sector, cost, and resources;
• internal controls are appropriate, well designed, and
operating consistently across the Group to manage risk
effectively; and
• the Group’s whistleblowing programme is appropriately
managed to reduce the risk of fraud or respond quickly
and decisively in the event the Group falls victim to fraud.
The Committee receives a report on the enterprise risk
management framework (ERM) at each meeting from the
Group Head of Internal Audit. During the year, the
Committee monitored the ERM priorities for 2024, business
continuity management, the Group’s quarterly cycle of risk
review and action planning including the assessment of
climate change risks and opportunities, and half yearly
effectiveness review. Following the sale of the UK Retail
business, the Committee also monitored the risks associated
with the UK separation. Further details on how the Group
manages risk is given in the Risk Management Report on
pages 52 to 61.
InControl Standards
InControl Standards (ICS), are designed to enable
management to establish, assess, and enhance strong and
consistent risk and control governance. The framework is
regularly reviewed and updated in line with emerging Group
risks, in response to emerging Internal Audit issues, and
following any investigation activity. The ICS has been
designed to mitigate the most significant risks across the
Group providing robust governance and sound controls.
The central and regional Internal Controls teams support the
business by providing the framework, tools, and training, and
ongoing support to embed the ICS across the business.
The Internal Control function is separate from the Internal
Audit function and works with management teams to design
controls that are proportionate to the level of risk, supported
by systems, and are easy to follow.
During the year the Committee considered the self-
assessment scores for each market, control gaps identified
and remedial action plans, and controls automation plans.
Main features of internal control and risks management
systems to financial reporting
The key features of the Group’s internal control and risk
management systems that underpin the accuracy and
reliability of financial reporting include: clearly defined lines
of accountability and delegation of authority; the Group’s
Code of Conduct; policies and procedures that
cover financial planning and reporting; preparing
consolidated financial accounts; capital expenditure;
project governance; and information security.
Processes and systems in place include:
• annual approval of the Group’s budget by the Board with
regular updates on actual performance against plan,
regional breakdowns, and analysis of variances;
• a comprehensive system of key control and oversight
processes, including regular reconciliations;
• updates for the Committee on accounting developments,
including draft and new accounting standards
and legislation;
• reports from Internal Audit on matters relevant to the
financial reporting process, including periodic assessments
of internal controls, processes, and fraud risk;
• independent updates and reports from the external
auditor on accounting developments, application of
accounting standards, key accounting judgements, and
observations on systems and controls;
• appointment of experienced and professional colleagues
with requisite knowledge and skills to perform their duties;
and
• appropriate Board oversight of external reporting.
In addition, the Group has established a dedicated Internal
Controls team who carry out controls testing on a quarterly
basis, with progress reported to management and the Audit
Committee at regular intervals during the year. This includes
implementation of management actions to remediate issues
identified and make improvements.
Monitoring the effectiveness of the risk management and
internal control systems
The Board, through delegated authority to the Audit
Committee, has ultimate responsibility for the effective
management of risk across the Group and for monitoring
how each business area implements appropriate
internal controls.
The Group’s risk management systems are designed to
support the business in actively managing risk to achieve
business objectives and can only provide reasonable, but
not absolute, assurance against material misstatement or
loss. These systems are also designed to be sufficiently agile
to respond to changes in circumstances such as the
consequences of new acquisitions, changes triggered by
new legislation, and significant external events.
The Committee monitors the effectiveness of the internal
control and risk management systems through various
sources of assurance including reports from the Group Head
of Internal Audit on the ICS framework, the enterprise risk
management framework, and the status of internal audits.
When reviewing the effectiveness of the ERM framework, the
Committee considered the design of the ERM process,
whether it had been applied to all material areas of the
business, whether the process had identified the most
material risks to the Group, and any new or additional
mitigation actions to address the principal risks. The Audit
Committee also receives reports on principal risk descriptions
and risk footprint, as well as receiving regular updates on the
status of the Group’s principal and emerging risks. This year,
these reviews have covered areas including cybersecurity
and IT resilience.
When assessing the effectiveness of the internal control
framework, the Committee considers the independent
assessment of the effectiveness of risk management and
internal control systems provided by the Group Head of
Internal Audit. The Audit Committee also receives regular
reports on the status of the controls assurance plan which
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covers controls in each Market and function, and monitors
compliance with and effective operation of the ICS
framework. The Committee also considered the actions
taken to enhance controls design and effectiveness, testing
results and trends analysis derived from the Group’s
integrated risk management system.
In addition, the Committee reviews the report presented by
Deloitte during the year on control improvement
recommendations and other observations made on the
control environment during the audit.
Any significant control failings or weaknesses are reported to
the Board, along with a detailed review of the findings and
mitigation plans being put in place. The Board monitors
progress against plans until it is satisfied that such matters are
resolved appropriately.
The Board has determined that there were no significant
failings or weaknesses identified during the review of risk
management and internal control processes during the year
and further confirms that these systems were in place during
2024 and to the date of this report.
Internal Audit
A primary source of assurance for the Committee is through
the delivery of the Internal Audit plan (IA Plan) which is
structured to align with the Group’s strategic priorities. The
internal audit strategy is updated on an annual basis to
ensure that it is aligned to the changing risk profile
of the Group, the external environment, and the needs of
both management and the Audit Committee.
The Group Head of Internal Audit presents the IA Plan to the
Committee for review and approval on an annual basis. The
Committee assesses the IA Plan to ensure that it is fully
aligned with the Group’s Accelerate+ strategy and
principal risks.
The Audit Committee assesses the effectiveness of Internal
Audit by reviewing the IA Plan at the start of the financial
year, monitoring its ongoing quality throughout the year, and
assessing completion rates and feedback provided following
completion of the audits. Having conducted this assessment
for 2024, the Audit Committee is of the view that the quality,
experience, and expertise of Internal Audit is appropriate for
the business.
The outcomes of Internal Audit assignments are reviewed by
the Committee throughout the year. The audit reports
provide details of overall ratings, reasons for the rating, and
any actions to be taken within a specific timeframe. Any
significant reports issued during the period are monitored by
the Committee until they have been closed satisfactorily.
During the year, the Committee considered the findings of a
number of audits including operational controls in Bolivia,
payroll in Chile and Peru global travel audit, and integration
of new business in the Philippines and DXP.
The 2025 IA Plan was approved by the Committee in
December 2024. When approving the IA Plan, the
Committee assessed the alignment to the Accelerate+
strategy and principal risk profile, proposed audits, and
audit coverage.
Functional assurance
A broad range of assurance activities have been designed
and established across the business to target key risk areas,
such as finance, legal and regulatory, digital, cyber, and
health, safety, & environment (HSE). While reporting lines for
these activities are directly to the respective business areas,
the processes and controls of these functions are periodically
tested by Internal Audit and discussed with the Audit
Committee. The Chief Information Security Officer and Group
Tax Director provide regular reports to the Audit Committee
on their areas of expertise.
Operational oversight
Senior management forums and committees provide
oversight and challenge on key risk areas within individual
businesses, cross-business programmes, or activities, such as
transformation programmes, acquisitions, sustainability,
Digital, People, HSE, Cyber, and other areas of change.
The output from these discussions forms part of the updates
provided to the Audit Committee or assured through the
Internal Audit and ICS programme.
Whistleblowing
Colleagues and third-party business partners are
encouraged to raise concerns about potential breaches of
the Code of Conduct or other policies, either to their line
managers, Legal, People, Internal Audit and Risk colleagues,
or to Speak Up, a confidential whistleblowing mechanism.
Speak Up is a global service administered by an
independent provider, accessible online, by QR code or by
telephone. Independent Inchcape teams investigate
allegations, with progress being monitored by Internal Audit.
When allegations are substantiated, appropriate disciplinary
and corrective actions are taken.
The Head of Internal Audit provides an update on fraud and
whistleblowing cases at each meeting which includes new
reports made throughout the year and open cases still under
investigation. The cases which are reported to the Audit
Committee are those of sufficient significance to warrant
attention; however, a list of all reports is also provided to the
Audit Committee for its review along with a breakdown by
Market, report type, and source. The Audit Committee Chair
reports to the Board on any significant whistleblowing cases,
and remediation plans, as they arise.
The Audit Committee and the Board consider the
whistleblowing cases resolved during the year, including
any actions taken, and are satisfied there were no
significant concerns.
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External audit
The Committee has complied with the FRC’s guidance,
issued in May 2023, on Audit Committees and the External
Audit: Minimum Standard. The activities undertaken to meet
the requirements of the Standard are outlined throughout this
Audit Committee Report.
Audit tender
Following an audit tender process during 2017, Deloitte LLP
was appointed as the Group’s auditor with shareholder
support for the appointment given at the 2018 Annual
General Meeting. David Griffin is the lead Audit Partner and
has been in position since July 2023.
The Company is in compliance with the requirements of the
Statutory Audit Services for Large Companies Market
Investigation (Mandatory Use of Competitive Tender
Processes and Audit Responsibilities) Order 2014, which
relates to the frequency and governance of external audit
tenders and the setting of a policy on the provision of non-
audit services. The Committee reviews and makes a
recommendation to the Board with regard to the
reappointment of the current external auditor. In making this
recommendation, the Committee monitored and assessed
their effectiveness, objectivity, independence, lead partner
rotation, and any other factors that may impact the
Committee’s judgement regarding the external auditor.
The Committee has concluded that it remains satisfied with
the effectiveness and quality of the audit work. The
Committee also remains satisfied with the capabilities of
Deloitte, its knowledge of the business, and its relationship
with Inchcape. The Committee believes that it is in the best
interests of shareholders to continue to recommend Deloitte
as the external auditor and it is not currently anticipated that
a tender process is immediately required. In line with
regulation, the Committee plans to initiate a competitive
tender of the external audit contract in 2026.
Auditor effectiveness, independence, and objectivity
A high-quality audit provides stakeholders with assurance
that the financial statements give a true and fair view of the
business. Assessing whether the external audit process
provides this is a key activity of the Audit Committee during
the year.
The Committee carries out its assessment on an ongoing
basis by considering its interactions with the auditor, its
observations of the auditor, and the relationship between
the Audit Committee, the auditor, and management. The
Committee also considers interactions with the Head of
Internal Audit and external regulators, such as the FRC. The
Company had no interactions with the FRC during 2024.
The auditor’s report to the Committee sets out the audit plan,
materiality, scoping, the risk assessment process, significant
risks, other areas of focus, the purpose of the report, and
responsibility statement. The Committee reviews at each
stage of the audit to ensure whether it is satisfied that the
audit plan is appropriate, if the auditor is meeting its
obligations, and to agree any changes to the audit if
they arise.
The Committee encourages a culture of open
communication and debate, and the Committee believes
that it is able to ask questions on key issues and to challenge
it when it feels more information is needed. The Committee
also looks at how management responds to requests from
the auditor and carefully reviews the auditor’s findings and
recommendations at each meeting.
When the auditor supports management’s approach, the
Committee considers the evidence supplied by the auditor
to support its decision to ensure that the auditor is not
compromised and remains objective. Where the auditor has
challenged management, the Committee considers the
feedback from management, whether the issues are
addressed satisfactorily, and whether agreed positions
are appropriate.
The auditor also meets with the Committee without the
presence of management on a regular basis, usually
following each meeting. This gives the auditor an opportunity
to confirm its view that management are addressing any
issues raised appropriately or to raise any concerns they
may have.
External evidence of the quality of the audit is also vital in
assisting the Committee in its review of the effectiveness of
the audit, with the audit quality inspection reports being a
key source of external evidence of audit quality.
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Non-audit services
Implementing a Non-Audit Services Policy (Policy) is also key to
ensuring the independence of the external auditor. The Policy
for non-audit services sets out the permitted and non-
permitted non-audit services as well as the approval levels
required by the Audit Committee and is designed to ensure
that the external auditor’s objectivity is not compromised by
earning a disproportionate level of fees for non-audit services
or by performing work that, by its nature, may compromise the
auditor’s independence.
However, using advisors who understand the Group’s business
can be a benefit and the Committee will consider non-audit
services supplied on an ongoing basis.
The Audit Committee review the non-audit services provided
by the external auditor twice a year.
The Group’s Policy on non-audit services to be provided by
the Group’s auditor defines two types of non-audit services
that may be performed:
• regulatory services, which are services undertaken as
auditor or reporting accountant which are outside the
scope of the statutory audit, but which are consistent with
the role of statutory auditor; and
• permitted non-audit services, which are services that the
auditor may be permitted to undertake subject to the
appropriate level of approval.
The aggregate fees incurred for permitted non-audit services
relative to the audit fee should not exceed 70% of the
average audit fee over the previous three years, with such
cap applicable to both Group and UK audit fees.
The provision of permitted non-audit services will only be
approved by the Audit Committee if:
• engagement of the auditor to provide the services does
not impair the independence or objectivity of the
external auditor;
• the skills and experience of the external auditor make it the
most suitable supplier of the non-audit service;
• the auditor does not have a conflict of interest due to a
relationship with another entity; and
• the aggregate fees incurred for permitted non-audit
services relative to the audit fee do not exceed 70% of the
average audit fee over the previous three years.
Permitted non-audit services above a certain level are
approved on a case-by-case basis by the Audit Committee.
Permitted non-audit services carried out during the year
The following non-audit fees incurred with Deloitte were:
2024
£’000
2023
£’000
2022
£’000
Group audit fees (three-year average)
6,300
4,899
3,524
Regulatory services
—
120
5,421
Permitted non-audit services
262
279
819
Ratio of non-audit fees to audit fees
0.04:1 0.06:1 0.23:1
The permitted non-audit services in 2024 included review of
the Group's Interim Financial Statements, providing readiness
assurance for the Group’s double materiality assessment, a
review opinion on the 2023 financial statements for Inchcape
International Group B.V., and specific procedures on the
statement of contributions for the Hong Kong pension
schemes for annual submission to the Mandatory Provident
Fund Schemes Authority. For further information, please see
note 3 to the consolidated financial statements on page 146.
The Group remained within the Audit Committee approved
ratio of audit to non-audit fees throughout 2024. The non-audit
fees were significantly higher in 2022 due to the services
provided by Deloitte in respect of the Derco acquisition.
After considering all of the elements detailed in this report, the
conclusion of the Committee is that the auditor carried out its
audit effectively and that the auditor is independent
and objective.
The Committee is proposing that Deloitte be re-appointed as
external auditor to the Company at the 2025 Annual General
Meeting. There are no contractual obligations that restrict the
Committee’s choice of auditor and the recommendation is
free from third-party influence.
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Alex Jensen
Chair of the Sustainability Committee
The Committee held three meetings throughout the year
covering key areas of its remit: sustainability strategy and
reporting, Planet and Places, and workforce engagement.
The Committee’s responsibilities include agreeing the
Group’s sustainability narrative, monitoring on-going
engagement, consideration of appropriate emissions targets
and on-going assessment of performance against those
targets, and oversight of the Planet and Places pillars.
The Committee consists of four Non-Executive Directors, the
Chairman, and the Group Chief Executive.
Sustainability strategy
The Committee recognises that having a robust sustainability
strategy in place to address environment, social, and
governance matters (ESG) concerns is vital for ensuring long-
term success of the Group. A key activity for the Committee
during the year was the review and approval of the Group’s
sustainability strategy. Inchcape’s approach to sustainability
has been enhanced over recent years with an evolution of
the Responsible Business framework to a stated sustainability
ambition: ‘the global mobility transition, delivered locally’.
The ambition is supported by the four Responsible Business
pillars: Planet, People, Places, and Practices, and is delivered
through enabling new technologies and delivering insights.
I am delighted that the progress made on the sustainability
agenda was highlighted in 2024 with the publication of the
Group’s first standalone Sustainability Report which can be
found at www.inchcape.com.
Remit of the Sustainability Committee
To support the evolving sustainability framework, and in
response to a recommendation from the 2023 Board
performance review, the Committee undertook a
comprehensive review of its remit and terms of reference.
Under the previous Responsible Business framework the
Committee had accountability for each of the four pillars:
Planet, People, Places, and Practices, along with health,
safety, and well-being.
The Committee debated the ESG issues most material to the
Group, how these are communicated to the Board, and
which Committee they might naturally fall to given the
subject matter.
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Dear Shareholder
I am pleased to present the
Sustainability Committee Report for
the year ended 31 December 2024.
The aim of this report is to provide
an overview of how the Committee
has discharged its responsibilities
and should be read in conjunction
with pages 32 to 50, and the
Sustainability Report available at
www.inchcape.com.
Committee snapshot
What we did
Outcome
Review of sustainability
strategy
Standalone Sustainability
Report
Workforce engagement
Engagement session held at
Inchcape Hellas
Regulatory planning
CSRD readiness project
commenced
Review of CO2 emissions
targets
Decision on scope 3 emissions
The Committee’s terms of reference can be found at
www.inchcape.com
Meeting attendance
Scheduled
Alex Jensen (Chair)
Nayantara Bali
Jerry Buhlmann
Byron Grote
Alison Platt*
Duncan Tait
Nigel Stein**
n Number of meetings attended
n Number of meetings
* Alison Platt was unable to attend the December meeting due
to prior commitments before joining Inchcape.
** Nigel Stein retired from the Board in May 2024.
Environmental
As the Group’s environmental strategy continues to mature,
and with the increased regulatory burdens of climate-related
reporting, the Committee retained oversight of the Planet
pillar, with any financial reporting or climate-related
remuneration also being considered by the Audit Committee
and Remuneration Committee when appropriate.
Social
There are several issues grouped under ‘social’ which are
reflected in the People, Places, and Practices pillars. The
activities and initiatives under the People pillar are
considered by the full Board, with the Nomination
Committee having oversight of I&D regulatory obligations.
Therefore it was agreed that People would be removed from
the Committee remit. The purpose of the Places pillar has
been refreshed following the materiality assessment in 2023
(see below), therefore oversight of Places remains a
Committee responsibility.
Governance
The remit of the Practices pillar is focused on further
developing the Group’s approach to being an ethical
business by continually monitoring and updating the
principals and standards that guide the way we work and do
business. The Committee agreed that this complements the
responsibilities already undertaken by the Audit Committee.
Due to the nature of ESG issues and the natural overlap of
duties between the Committees and the Board, the Chairs of
the Audit and Remuneration Committee both attend at least
one Sustainability Committee meeting to ensure that
appropriate oversight is being given to the issues.
Places pillar: safe mobility and social inclusion
Following a series of internal workshops to formally embed
the results of the materiality assessment and refreshed
narrative on sustainability, the Committee considered the
refresh of the purpose of the Places pillar. The new purpose is
to actively contribute to our communities where we operate
and engaging them in the mobility transition to create
positive lasting change.
The Committee believes that the newly defined purpose is
vital in supporting Accelerate+ and ensuring the Group is
responsive to the changing needs of its communities.
The themes of the Places pillar have also been amended to
safe mobility and social inclusion. Please see page 34 for
further details.
Planet pillar: scope 3 target setting
The Committee reviewed the analysis of the Group’s scope 3
footprint to ascertain whether it was feasible to set targets.
The modelling work was carried out on category 1 and
category 11 which account for 91% of the Group’s scope 3
emissions.
The analysis showed that Inchcape would not meet an
absolute SBTi emissions reduction target on basis of sales
projections and was closest to being able to meet an
intensity per revenue target limited to category 11. However,
given that Inchcape is not projected to be able to achieve
any of the SBTi-aligned candidate targets, the Committee
recommended to the Board that scope 3 targets are not set
at this time and focus should continue on actions we can
take in our Markets, to accelerate the transition towards
more sustainable mobility in line with our refreshed narrative.
Further information is given in the TCFD report on page 49.
Regulatory landscape
A key responsibility of the Committee is monitoring the
regulatory landscape in relation to ESG and how this may
impact the Group. A significant piece of legislation is the EU’s
Corporate Social Responsibility Directive (CSRD) which is
designed to enhance and standardise sustainability
reporting requirements for companies operating in the EU.
This regulation also impacts non-EU companies with parent
companies required to report from 2028. With support from
KPMG the Committee spent time reviewing the reporting
scope for CSRD, debating whether it would be
in the Group’s and stakeholders best interests to report to
Group level from 2025 and ultimately advised the Board that
this would be appropriate.
CSRD readiness
An internal working group has been established to prepare
the Group for its first CSRD disclosure. The Group is headed
by the Group General Counsel & Chief Sustainability Officer
and provides updates to the Committee on CSRD readiness
and progress to compliance at each meeting. Agreeing the
double materiality assessment and thresholds for reporting
which was debated and agreed by the Board in October
and a further update on the Committee and Board’s CSRD
activities will be given in next year’s Annual Report
and Accounts.
Colleague engagement
Accountability for colleague engagement as required under
the UK Corporate Governance Code is part of the
Sustainability Committee’s remit. Following three years as the
designated Non-Executive Director (DNED), I am delighted to
pass the DNED role to Nayantara Bali. Nayantara has been a
member of the Committee since joining the Board and
facilitated the session in Athens in October along with
Byron Grote.
The format of the session is informal, with colleagues from a
wide range of business areas invited to participate.
Colleagues are invited to ask questions on any topic they
feel is of importance to them and subjects raised in 2024
ranged from sustainability, brand identity, and international
mobility. Nayantara Bali and Byron Grote provided feedback
to the Board and management and will feed into future
engagement plans. Progress against plans is reviewed by the
Committee annually to ensure the points raised by
colleagues are being addressed appropriately. Further
information on how the Board engages with colleagues and
the outcomes of engagement is given on page 77.
Byron Grote also held a virtual reward engagement session
and further details are given in the Directors’ Report on
Remuneration on page 93.
Alex Jensen
Chair of the Sustainability Committee
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Byron Grote
Chair of the Remuneration Committee
2024 was a transformational year for Inchcape with the
successful sale of the UK business and the launch of the
refreshed Accelerate+ strategy, combined with strong
operational and financial performance.
Committee changes
I became Chair of the Committee in May 2024, taking over
from Jane Kingston who retired from the Board. I would like to
thank Jane for her dedication and commitment in leading
the Committee over the last five years. During Jane’s tenure,
two successful remuneration policies were approved by
shareholders providing a strong reward foundation for
the Group.
I would also like to welcome Alison Platt and Stuart Rowley
who joined the Committee in January and November 2024
respectively.
The Committee also appointed new remuneration advisors,
WTW, during 2024. Further details are given on page 106.
Business performance and remuneration in 2024
Performance context
During 2024, the Group has delivered against a number of
metrics including:
• 4% revenue growth in constant currency;
• 22 distribution contact wins across all Regions with a range
of OEM partners;
• successful sale of the UK Retail business;
• £150m share buyback programme completed in early
2025; and
• dividends for 2024 of £147m.
The Group’s continued strategic, operational, and financial
delivery ensured there is a strong link between pay
and performance.
As detailed in the Strategic Report, the Group delivered
revenue of £9.3bn, adjusted profit before tax of £444m,
EPS of 71.3p (basic adjusted), and adjusted ROCE of 27%.
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DIRECTORS' REPORT ON REMUNERATION
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91
Dear Shareholder
On behalf of the Board, I am
pleased to present the Directors’
Report on Remuneration for the
year ended 31 December 2024. The
aim of this report is to demonstrate
how the Committee has discharged
its duties during the year and I hope
you find it informative.
Committee snapshot
What we did
Outcome
Assessment of 2024
performance targets
Adjustment made for sale of
UK business
Incentivising delivery of
Accelerate+
Approved one-off award for
2025 to deliver Accelerate+
Review of remuneration
advisors
New advisor appointed in
2024
Reviewed wider
workforce remuneration
Support for UK workforce
pension rate to increase to
10% of salary
The Committee’s terms of reference can be found
at www.inchcape.com
Meeting attendance
Scheduled
Ad Hoc
Byron Grote (Chair)
Jerry Buhlmann
Alex Jensen
Alison Platt***
Stuart Rowley*
Jane Kingston**
Nigel Stein**
n Number of meetings attended
n Number of meetings
* Stuart Rowley joined the Committee in November 2024.
** Jane Kingston and Nigel Stein retired from the Board in May 2024.
*** Alison Platt was unable to attend the ad hoc meeting due to a prior
commitment before joining Inchcape.
The Group Chief Executive, Group Chief Financial Officer, Chief
People Officer, Group Reward and Pensions Director, and the
remuneration advisors also attend as requested.
2024 salary increases
The Committee reviewed the Group Chief Executive’s salary
in early 2024 and approved an increase of 2.5%. This increase
was consistent with the increases made to other members of
the senior leadership team and below the 2.8% average
increases offered to the UK workforce.
In recognition of strong performance in his new role and to
better align with market rate, the Group Chief Financial
Officer was awarded a 3% salary increase for 2024.
The Chairman and the Non-Executive Directors received a
fee increase of 2.5% with effect from 1 April 2024.
2024 bonus
The 2024 bonus was based on a matrix of profit before tax
and revenue in addition to a working capital metric. Working
capital was introduced to reinforce disciplined management
of working capital throughout the year which is fundamental
to the aims of the Accelerate+ strategy. Vesting of the
working capital portion is subject to meeting the threshold
level of performance for revenue and profit before tax.
Consistent with historical practice, the revenue and profit
before tax targets for 2024 were adjusted to consider
strategic acquisitions and disposals during the year, including
the sale of the UK Retail business, to ensure target and
performance outcomes were assessed on a like for like basis.
As a result, Duncan Tait received a bonus of 106.04% of
salary, and Adrian Lewis received a bonus of 104.54% of
salary. Please see pages 97 to 98 for further details.
2022 PSP/CIP
The 2022 awards will vest based on EPS, ROCE, and cash
performance targets over the three years ending 31
December 2024. The cumulative EPS (40% of award) was
234p, the average ROCE (40% of award) was 31% and the
average cash conversion (20% of award) was 82%, resulting
in the 2022 awards vesting at 100% of maximum.
In light of the UK Retail business disposal, the Committee
reviewed the targets for the 2022 long-term incentive plans.
To ensure fairness, adjustments were made to account for
the exclusion of UK profits from 1 August 2024, the interest
earned on the sale proceeds and the impact of the resulting
share buyback. The Committee determined that the ROCE
targets were still appropriate and challenging, therefore no
changes were made to these targets.
Malus and clawback
The Committee considers whether there are potential
‘trigger’ events for malus and clawback which the Group
Head of Internal Audit, Head of Group Reporting, Group HSE
Director, and Chief Security Information Officer have been
made aware of.
The Committee are satisfied that there have been no
instances which would require an adjustment to the
outcome of the incentive plans for the Executive Directors.
The new UK Corporate Governance Code, which was
published at the beginning of 2024, and is effective from 1
January 2025, contains amendments to the malus and
clawback provisions. Provision 37 has been amended to
include that Directors’ contracts and/or other agreements
or documents which cover director remuneration should
include malus and clawback and Provision 38 asks
companies to provide details of its malus and
clawback provisions.
The Company is fully compliant with the provisions of the new
Code and further details of the Group’s malus and clawback
policy can be found on page 106.
Overall remuneration
The Committee is satisfied that the total remuneration
received by the Executive Directors’ in 2024 appropriately
reflects the Company’s underlying business performance
over the year and three-year PSP/CIP performance period
and, as such, no discretion was exercised by the Committee
to adjust the bonus or long-term incentive outcomes. The
Committee believes that the Policy has operated
as intended.
Implementation of policy in 2025
As we activate our Accelerate+ strategy and further
consolidate our position as the world's leading automotive
distributor, it is important that we can attract and retain
individuals of the right calibre. The Group Chief Executive,
Group Chief Financial Officer, and the Group Executive
Team are central to the successful execution of the
Accelerate+ strategy due to their experience in role
and deep relationships that they have built with our
key OEM partners.
The Committee has therefore made the following
implementation decisions for Executive remuneration in 2025
within the current Remuneration Policy which we believe will
further align our Executive Directors with the successful
delivery of our long-term business plan.
Current remuneration policy
The Committee undertook a full review of the Remuneration
Policy in 2022 which was subject to a binding vote at the
Annual General Meeting (AGM) held on 18 May 2023. The
Committee was delighted to receive 96.07% support for the
resolution at the AGM and is confident that the policy
continues to remain appropriate for Inchcape during 2025.
Given this strong support and the continued performance of
the Company, our approach to remuneration in 2025 will be
consistent with the policy already approved by shareholders.
The Remuneration Policy is due for triennial renewal at the
2026 AGM. In advance of renewal, the Committee intends to
undertake a comprehensive review of the Remuneration
Policy to ensure that it remains fit for purpose, supports the
Accelerate+ strategy, and aligns with the interests of our
stakeholders. The Committee will be seeking to engage
further with shareholders ahead of submitting a resolution to
shareholders at the 2026 AGM.
As in previous years, shareholders will be able to vote on our
Annual Report on Remuneration, which details both the
execution of our policy in 2024 and the implementation for
the coming year at our AGM in May 2025.
Base salary
Since joining Inchcape, the Group Chief Executive has
successfully led on the execution of strategy and now
embarks on delivering the ambitious objectives of
Accelerate+ and delivering value for our shareholders. Since
appointment, salary increases for the Group Chief Executive
have been at or below the average of the UK workforce and
the Committee felt it appropriate that his contribution,
performance, and importance to delivery of Accelerate+
was recognised. The Committee has therefore approved a
salary increase of 7% with effect from 1 April 2025.
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Although this is higher than the average UK workforce
increase of 3% in 2025, in determining the level of increase,
the Committee’s primary consideration was the
performance of the Group Chief Executive, and the
attractiveness of his unique skill set in the global automotive
sector. The Committee also considered CEO salaries in the
FTSE 51-150. Further, the sale of the UK retail business has
resulted in less than 1% of the global workforce being UK
based and as such Inchcape must increasingly consider pay
competitiveness in an international context. The Committee
believes the increase for the Group Chief Executive is
appropriate and consistent with the pay principles for
Inchcape’s highest performers and critical talent.
The salary increase for the Group Chief Financial Officer of
2.7% is below the average workforce increase. The Chairman
and the Non-Executive Directors will also receive a fee
increase of 3% with effect from 1 April 2025.
Pension
Effective from 1 April 2025, the Executive Directors will receive
a pension allowance, or employer pension contribution, of
10% of salary, an increase from the current 7% of salary. This
increase aligns with the pension rate offered to the wider UK
workforce, which is also increasing in 2025, in compliance with
provision 39 of the 2024 UK Corporate Governance Code.
Long-term incentives
To support the delivery of the ambitious aims of the
Accelerate+ strategy, the Committee has worked with the
Executive Directors to design an incentive program for the
wider leadership team to drive implementation and
achievement of enhanced growth under Accelerate+. In
doing so, the Committee feels that it is appropriate that the
Executive Directors be similarly incentivised to provide
alignment with the wider team.
For 2025, the Group Chief Executive and Group Chief
Financial Officer will receive an incremental one-off PSP of
70% of salary tied to super-stretch earnings per share (EPS)
performance. This is on-top of the normal PSP of 180% of
salary based on performance metrics (40% EPS, 40% ROCE,
and 20% cash conversion) which will continue. The overall
PSP for 2025 only will thus be 250%. The proportionality of the
one-off award is consistent across the leadership team of c.
300 participants.
The one-off award is subject to a super-stretch EPS
performance target which will only begin to vest if Inchcape
delivers significantly above the Board's most ambitious
interpretation of the three-year plan and will only vest at
maximum if performance equivalent to 15% CAGR growth if
EPS is achieved between 2025-2027. The Committee has
selected EPS for the one-off award as EPS performance is
fundamental to the Accelerate+ strategy which includes
enlarging the business through acquisitions, contract wins,
and organic performance, whilst delivering a resilient
operating margin. As an existing metric, EPS is well
understood by management across the Group and there
is a clear line of sight for management to influence EPS
performance.
In determining the super-stretch target, the Committee
reviewed EPS growth targets in the FTSE 51-150, historic levels
of EPS performance for both Inchcape and relevant peers,
and analyst forecasts at the time the super-stretch target
was approved.
The performance targets are given on page 105.
Upon vesting the Committee will continue to consider the
underlying financial and operational performance of the
business to ensure that vesting outcomes appropriately
reflect overarching performance and shareholder
experience. The Committee retains the discretion to adjust
vesting outcomes to ensure alignment with both
performance and shareholder value creation over
the period.
Reflecting ESG priorities in our incentive framework
The Committee recognises the importance of environment,
social, and governance (ESG) factors in driving long-term
business success. For 2025, we will continue to incentivise
carbon reduction through the annual bonus scheme. This
approach allows us to drive immediate progress on our
environmental goals, gather valuable data and insights on
the effectiveness of our carbon reduction initiatives, and
refine our understanding of how ESG factors can best be
integrated into our approach to executive compensation.
The Committee will conduct a comprehensive review of our
approach to incentivising ESG outcomes in the forthcoming
review of policy.
Engagement with the workforce
In 2024, I chaired a reward forum with a range of colleagues
from the Americas and Caribbean Markets. The forum gave
an overview of the governance framework and guidelines in
the UK and how this impacts reward and focused on reward
structures and the fair pay principles.
Themes raised included the framework for benefits, and how
the benefits offered may evolve with a changing workforce,
how shareholder, and other stakeholder views, are taken into
account when setting remuneration, benchmarking, industry
specific reward, and attracting talent. No issues of concern
were raised by colleagues, and I fedback to the Board and
management on the areas discussed.
Wider workforce remuneration
Consideration of wider workforce remuneration continues to
improve with the Group’s Fair Reward Principles embedded
in all markets. Regional remuneration committees are also
in place to oversee the implementation of the principles
processes and to provide a strong governance framework
throughout the Group.
In 2024, the Group conducted a review of pension provisions
across all Markets which highlighted that the Group generally
offers a market competitive retirement provision. For the UK
workforce, the Group is amending its pension provision by
offering enhanced employer contributions on a matched
basis of up to 10% of salary.
The Committee receives regular updates on the progress
being made on the implementation of reward processes
across the Group, all of which have led to increased
satisfaction scores for pay and wellbeing in the 2024 Be
Heard survey. Further details of the survey results are given in
the Sustainability Report which is available at
www.inchcape.com
Byron Grote
Chair of the Remuneration Committee
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WHAT DID EXECUTIVE DIRECTORS EARN DURING 2024
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Bonus outcome
Duncan Tait
Adrian Lewis
71%
70%
of maximum
of maximum
LTIP outcome
Duncan Tait
Adrian Lewis
100% 100%
of maximum
of maximum
Wider workforce in 2024
Bonus eligibility
c.
4,800
colleagues eligible for bonus
Pension eligibility
c.
6,000
colleagues eligible for pension
4,793,046
Salary
Benefits
Pension
Bonus
PSP/CIP
Duncan Tait
1,448,498
Salary
Benefits
Pension
Bonus
PSP/CIP
Adrian Lewis
0%
50%
100%
Three year cumulative EPS
(40%)
Three year average ROCE
(40%)
Cash conversion (20%)
% of maximum
0%
50%
100%
Financial performance matrix
(revenue and PBT 60%)
Working capital (20%)
Personal objectives (20%)
HOW WILL EXECUTIVES BE PAID IN 2025?
Fixed pay
CEO salary
£952,965
CFO salary
£507,749
Benefits package remains unchanged –
includes car allowance, medical cover,
and mileage allowance.
Pension rate increasing to 10% of salary
in line with wider UK workforce.
Annual bonus
CEO and CFO: up to 150% of salary. Any bonus earned
above 100% of salary is deferred and invested into the
CIP.
Bonus metrics in 2025
Financial performance matrix (revenue & PBT)
Working capital
Strategic objectives
PSP & CIP
PSP: 180% of salary
One-off award: 70% of salary
CIP: up to 50% of salary with up to 2:1 match.
PSP / CIP metrics in 2023-2025
EPS
ROCE
Cash conversion
Malus and clawback provisions allow the Committee in
certain circumstances (such as gross misconduct or a
material misstatement of the Group financial
statements, reputational damage, or corporate failure)
the discretion to reduce bonus, PSP and/or CIP vest,
cancel entitlement of a bonus, prevent vesting of the
PSP and/or CIP, or allow the Company within two years
of payment/vesting of award to claim back up to 100%
of the award.
Performance scenarios
Duncan Tait –
Group Chief Executive
Total remuneration (£’000s)
Adrian Lewis –
Group Chief Financial Officer
Total remuneration (£’000s)
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1. Incentive levels reflect the normal and one-off PSP awards for 180% and 70% of salary respectively.
2. On-target assumes 50% annual bonus, 25% PSP vest, and CIP threshold match of 0.5:1.
3. Benefit levels reflect FY24 actuals.
4. Share price growth assumes 50% increase.
£1,086
£2,635
£5,850
£7,518
Minimum
On-target
Maximum
Maximum
with share
price
growth
£597
£1,422
£3,136
£4,025
Minimum
On-target
Maximum
Maximum
with share
price
growth
100%
41%
19%
14%
27%
24%
19%
32%
57%
67%
100%
42%
19%
15%
27%
24%
19%
31%
57%
66%
Annual Report on Remuneration
The current Directors’ Remuneration Policy was approved by shareholders at the Annual General Meeting held on 18 May 2023 and is available to view at www.inchcape.com. The Committee
has considered the Policy in the context of provision 40 of the 2018 UK Corporate Governance Code:
•
Clarity – The Committee regularly engages with shareholders, Executives, governance advisors, and employees, to explain the approach to remuneration.
•
Simplicity – The objective and link to strategy are clearly laid out.
•
Risk – There is a mix of fixed and variable pay, and long and short-term measures to mitigate risk. Incentive awards are also subject to malus and clawback provisions.
•
Predictability – The vesting of bonus and long-term incentives is based on targets linked to the business strategy.
•
Proportionality – The Committee assesses performance at the end of each period taking into account internal and external context to ensure payouts are appropriate and to help
avoid payment for poor performance.
•
Alignment to culture – There is an appropriate mix of financial and non-financial measures to reinforce the Company’s purpose and values.
The following section provides details of how the Company’s Directors’ Remuneration Policy was implemented during the financial year to 31 December 2024 and how it will be implemented in
the financial year to 31 December 2025.
Single total figure of remuneration (audited)
The table below sets out the total remuneration received by the Directors for the year ended 31 December 2024:
Base salary/fees (a)
Taxable benefits (b)
Single-year variable (c)
Multiple-year variable (d)
Pension (e)
Total
Total fixed (a+b+e)
Total variable (c+d)
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Name
2024
2023
2024
2023
2024
2023
2024
2023
2024
2023
2024
2023
2024
2023
2024
2023
Executive Directors
Duncan Tait
885
859
10
4
944
866
2,892
2,476
62
83
4,793
4,288
957
946
3,836
3,342
Adrian Lewis
491
290
12
2
517
313
396
338
33
12
1,449
955
536
304
913
651
Non-Executive Directors
Jerry Buhlmann
270
89
—
—
—
—
—
—
—
—
270
89
270
89
—
—
Sarah Kuijlaars
87
73
—
—
—
—
—
—
—
—
87
73
87
73
—
—
Alex Jensen
84
82
—
—
—
—
—
—
—
—
84
82
84
82
—
—
Alison Platt
83
—
—
—
—
—
—
—
—
—
83
—
83
—
—
—
Byron Grote
81
67
—
—
—
—
—
—
—
—
81
67
81
67
—
—
Juan Pablo Del Rio
70
67
10
15
—
—
—
—
—
—
80
82
80
82
—
—
Nayantara Bali
70
68
2
5
—
—
—
—
—
—
72
73
72
73
—
—
Stuart Rowley
70
31
—
—
—
—
—
—
—
—
70
31
70
31
—
—
Former Directors
Nigel Stein
130
357
1
4
—
—
—
—
—
—
131
361
131
361
—
—
Jane Kingston
31
85
—
—
—
—
—
—
—
—
31
85
31
85
—
—
Total
2,352
2,068
35
30
1,461
1,179
3,288
2,814
95
95
7,231
6,186
2,482
2,193
4,749
3,993
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Notes to the single total figure of remuneration
a. Base salary/fees. Due to an overpayment in 2023, which was reversed in 2024, the fees paid to Nayantara Bali in the single total figure of remuneration table reflect the amount due rather
than the actual amounts paid during the year.
b Taxable benefits for the Executive Directors comprise car allowance, medical cover, and mileage allowance. For the Non-Executive Directors taxable benefits include accommodation,
subsistence, and travel in connection with the attendance of Board and Committee meetings, which are deemed taxable by HM Revenue and Customs. The Group meets the associated
tax costs. Non-taxable expense reimbursements have not been included. Car allowance started to be paid to Executive Directors from the last quarter of 2024.
c. Payment for performance under the annual bonus, including amounts paid in shares.
d. The 2024 figure incudes to 2022 PSP and CIP which will vest in April and May 2025 based on performance over a three-year period from 1 January 2022 to 31 December 2024. These awards
are subject to a two-year holding period and will therefore be released in 2027. The figures have been valued using the three-month average share price from 1 October 2024 to 31
December 2024 of 763p. Actual performance against targets is given on page 99. The value for the Group Chief Executive includes a movement of £317,772 due to an increase in the share
price over the period and £304,658 in respect of dividend shares accrued over the performance period. The value for the Group Chief Financial Officer includes a movement of £44,745 due
to an increase in the share price over the period and £41,637 in respect of dividend shares accrued over the performance period.
The 2023 figures for the Executive Directors include the 2021 PSP and CIP which vested in June 2024 based on performance over a three-year period from 1 January 2021 to 31 December
2023. These awards are subject to an additional two-year holding period and therefore will be released in 2026. The figures have been restated using the actual share price on date of vesting
of 789p. The Group Chief Executive value includes a movement of -£2834, due to a decrease in the share price over the period and £239,351 in respect of dividend shares accrued over the
performance period. The Group Chief Financial Officer value includes a movement of -£387, due to a decrease in the share price over the period and £32,657 in respect of dividend shares
accrued over the performance period.
e. Duncan Tait received a pension allowance of £61,963.44 during 2024. Adrian Lewis received a pension allowance of £31,556 during 2024, in addition to one month contribution of £1,458.33
under the Company’s defined contribution scheme.
Base salary
Salaries are reviewed annually and typically take effect from 1 April each year. The quantum
of total executive remuneration was reviewed relevant to size and sector peers. In considering
the level of increase to be awarded the Committee also considered the remuneration
arrangements for the wider workforce.
For 2024, Duncan Tait received a salary of £890,623 per annum and Adrian Lewis received a
salary of £494,400 per annum.
Pension
For 2024, Duncan Tait received a pension allowance of 7% of salary. Adrian Lewis was a
member of the Company’s defined contribution scheme in January 2024, after which he left
the scheme and moved to receiving a pension allowance of 7% of salary. The pension
allowance is in line with the UK workforce average.
Bonus
For 2024, 80% of the bonus was based on financial performance via a matrix of revenue, profit
before tax, and working capital, with the remaining 20% of the bonus based on strategic
objectives therefore linking an individual’s bonus outcome to their contribution to the
Accelerate+ strategy. The maximum opportunity for Executive Directors was 150% of salary,
which is payable for achieving stretch performance against all measures. Any bonus earned
above 100% of salary is deferred and invested into the CIP.
Adjustments made during the year
On 1 August 2024, the UK Retail business was sold and has been treated as a discontinued
operation throughout 2024. Consistent with the treatment of discontinued operations in prior
years’ the targets have been adjusted to exclude UK Retail disposal impacts not
contemplated in the original targets.
The Committee approved the following adjustments:
•
Revenue target of £9.8bn; excludes £2.1bn UK revenue contribution.
•
Profit target of £474m: excludes £38m UK profit contribution offset by +£7m net interest
improvements. These interest improvements have resulted from the proceeds on
disposal net of share buyback initiated.
•
Working capital group target of £574m average.
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Actual performance against targets
Actual performance for determining bonus outcomes has been calculated using constant
currency rates during the year, the same that are used to set the bonus targets. This approach
helps ensure that the bonus is linked to underlying financial performance.
The Committee considered the bonus outcome in the context of overall business
performance and determined the outturn was a fair reflection of business performance.
Therefore no adjustment was made to the formulaic bonus outcome
Measure
Targets
Threshold
Target
Stretch
Actual
performance
Weighting
Revenue
£9.1bn
£9.8bn
£10.0bn
£9.8bn
30 %
Adjusted profit before tax
£427m
£474m
£521m
£494m
30 %
Working capital
£724m
£574m
£424m
£425m
20 %
Achievement of strategic objectives
We provide as much detail below as commercially appropriate on the objectives linked to
the strategic element of the 2024 bonus and the resulting outcomes, which have been
independently verified by the Head of Internal Audit.
Duncan Tait
Strategic objective
and % weighting of
bonus
Objective details
Outcome
Outcome %
of salary
Strategic
optimisation
5%
Optimise route-to-market
effectiveness and improve
overhead costs.
67% of our Distribution
Excellence platforms and
processes were deployed across
major Markets.
Overheads remained flat on
prior year.
3 %
Contract wins,
M&A and
integration
10%
Grow through contract wins
and ensure Derco synergies
exceed target.
22 contract wins during 2024.
Synergies exceeded target by
10%.
9 %
Planet
5%
Reduce CO2 emissions to
support our 2030 target of
46% reductions vs 2019.
Emissions reduced by 3,017
tCO2e in 2024 vs a target of
1,840 tCO2e.
8 %
Adrian Lewis
Strategic objective
and % weighting of
bonus
Objective details
Outcome
Outcome %
of salary
Global
Finance
Operating
Model
5%
Ensure the Inchcape
finance operating
model is deployed
consistently across the
Group.
Strong SAP coverage was delivered
during the year and the control
environment has remained robust
throughout.
5 %
Planet
5%
Reduce carbon
emissions by 2,000
tCO2e.
Implement a broad-
based data collection
and reporting process
compliant with CSRD
requirements.
Emissions reduced by 3,017 tCO2e in 2024
vs a target of 1,840 tCO2e.
Data collection and reporting framework
developed, resulting in a reduction in
errors. CSRD compliance on track for
disclosure in 2026 on FY2025.
8 %
Reduce costs
of route-to-
market
10%
Define and deploy the
Inchcape route-to-
market cost model
Overheads were 11.03% of revenue for
2024.
6 %
Overall 2024 bonus outcome
The Committee concluded that the overall bonus outcome was reflective of the Company’s
financial and operational performance and therefore did not make any discretionary
adjustments. As a result, the Committee approved the overall 2024 bonus as follows:
2024 base
salary
Max bonus
opportunity (% of
salary)
Bonus
outcome
(% of salary)
Bonus
amount (£)
Deferred
into CIP
Duncan Tait
£890,623
150%
106.04 %
£944,413
£53,791
Adrian Lewis
£494,400
150%
104.54 %
£516,844
£22,444
Any bonus earned above 100% of salary is deferred and invested into the CIP.
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PSP and CIP awards vesting in respect of the year
In 2022, awards were granted under the PSP and CIP schemes which vested dependent on
certain performance targets measured over three years to 31 December 2024. These awards
are also subject to an additional post-vest two-year holding period.
2022 performance targets
Three-year EPS cumulative growth p.a. (40% weighting)
Vesting %
Less than 191p
0%
191p
25%
211p
100%
Between 191p and 211p
Straight line basis
Three-year average ROCE (40% weighting)
Vesting %
Less than 21%
0%
21%
25%
26%
100%
Between 21% and 26%
Straight line basis
Cash conversion (20% weighting)
Vesting %
Less than 50%
0%
50%
25%
65%
100%
Between 50% and 65%
Straight line basis
Over the 2022 - 2024 performance period, cumulative EPS of 234p, three-year average ROCE
of 31%, and cash conversion of 82% were achieved resulting in the following vesting
outcomes:
Award
Performance measure
Wtg.
Vesting outcome
(% of element)
PSP/CIP
EPS
40%
40%
ROCE
40%
40%
Cash conversion
20%
20%
Total (overall vesting outcome)
100%
Adjustments made to performance targets
Consistent with the Committee’s policy, the Committee considered the impact of the disposal
of the UK Retail business and share buybacks on the performance targets on a constant
currency basis and made adjustments to EPS to reflect this. No adjustments were made for
ROCE and cash conversion.
2022 PSP and CIP awards vested
The Group Chief Executive was granted a PSP award of 180% of salary and a CIP award of
100% of salary. As a result, the following awards will vest.
Grant
date
Number of
awards
granted
Number of
awards vesting
Number of
awards lapsing
Vesting
date
Estimated
value of
awards vesting
(£)*
Duncan Tait
PSP
8 April 2022
222,342
222,342
0
8 April 2025
£1,696,469
CIP
6 May 2022
116,711
116,711
0
6 May 2025
£890,606
Adrian Lewis**
PSP
8 April 2022
32,676
32,676
0
8 April 2025
£249,318
CIP
6 May 2022
13,722
13,722
0
6 May 2025
£104,699
* Estimated value calculated using the three-month share price average from 1 October 2024 to 31
December 2024 of 763p. The average share price is above the prevailing share price at the time the 2022
awards were granted of 650p for the PSP and 706p for the CIP.
** Adrian Lewis was granted his 2022 awards before his appointment as Group Chief Financial Officer.
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PSP and CIP awards granted during the year
During 2024, the awards granted under the PSP and CIP schemes vest dependent on certain
performance targets measured over three years to 31 December 2026. These awards are also
subject to an additional post-vest two-year holding period.
Threshold performance will result in 25% of the PSP and CIP award vesting.
2024 PSP / CIP performance targets
Three-year cumulative EPS (40% weighting)
Vesting %
Less than 246p
0 %
246p
25 %
277p
100 %
Between 246p and 277p
Straight line basis
Three-year average ROCE (40% weighting)
Vesting %
Less than 21%
0 %
21%
25 %
28%
100 %
Between 21% and 28%
Straight line basis
Cash conversion (20% weighting)
Vesting %
Less than 60%
0 %
60%
25 %
70%
100 %
Between 60% and 70%
Straight line basis
The target assumes no share buybacks and is on a constant currency basis. Adjustments to
targets will be made for the impact of currency movements and share buybacks.
2024 PSP/CIP awards granted
PSP awards were granted to the Executive Directors at 180% of salary. Under the CIP, the
Executive Directors invested 50% of salary (including mandatory bonus deferral) and were
granted a matching award of 100% of salary.
Date of grant
Share price
(p)1
Awards
granted
Face value at
grant (£)2
Performance
period
Exercise
period3
Duncan Tait
PSP
11 April 2024
718p
216,608
£1,555,245
Jan 2024 –
Dec 2026
Apr 2027 –
Apr 2028
CIP
11 April 2024
718p
120,338
£864,027
Jan 2024 –
Dec 2026
Apr 2027 –
Oct 2027
Adrian Lewis
PSP
11 April 2024
718p
120,243
£863,345
Jan 2024 –
Dec 2026
Apr 2027 –
Apr 2028
CIP
11 April 2024
718p
66,330
£476,249
Jan 2024 –
Dec 2026
Apr 2027 –
Oct 2027
1. Mid-market share price on date of grant.
2. Face value has been calculated using the share price at date of grant.
3. The awards are structured as a £nil-cost option. Any shares vesting and exercised under the PSP and CIP
(net of tax) are required to be held (until the fifth anniversary of grant).
PSP and CIP awards exercised during the year
Duncan Tait and Adrian Lewis exercised the 2021 PSP and CIP awards during the year.
They sold sufficient shares to cover costs and tax and retained the remaining shares in line
with policy.
Plan
Awards
exercised
Dividend
shares
Share
price (p)*
Shares
sold
Shares
retained
Duncan Tait
PSP
182,210
19,502
764p
100,134
101,578
CIP
101,228
10,834
763p
55,630
56,432
Adrian Lewis
PSP
26,778
2,866
788p
14,721
14,923
CIP
11,900
1,273
768p
6,542
6,631
* Share sale price.
Exit payments during the year
None.
Payments to past Directors
No payments were made to past Directors in 2024.
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Pay for performance
The graph below shows the total shareholder return (TSR) of the Company over the 10-year
period to 31 December 2024.
The FTSE 250 Excluding Investment Trust Index has been chosen as the most suitable
comparator group as it is the general market index in which the Company appears. The table
details the Group Chief Executive’s single figure remuneration and actual variable pay
outcomes over the same period.
Historical TSR performance
Growth in the value of a hypothetical £100 holding over the 10 years to 31 December 2024.
Value of £100 invested at 31 December 2014
Value (£)
Inchcape PLC
FTSE 250
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
0
25
50
75
100
125
150
175
200
Group
Chief
Executive
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
Group Chief
Executive
single figure of
remuneration
(£’000)
André
Lacroix
2941
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
Stefan
Bomhard
2,906 1,403 3,006 2,430 1,522
4712
n/a
n/a
n/a
n/a
Duncan
Tait
n/a
n/a
n/a
n/a
n/a
468 2,054 4,098 4,288 4,793
Annual bonus
outcome (% of
maximum)
57 %
40 %
68 %
39 %
n/a5
— %
98 % 100 %
67 %
71 %
LTI vesting
outcome (% of
maximum)
n/a3
n/a4
80 %
58 %
40 %
n/a6
n/a7
60 % 100 % 100 %
1. The amount for André Lacroix reflects remuneration received until he left the Group in March 2015.
2. The amount for Stefan Bomhard reflects remuneration received until he left the Group in June 2020.
3. Neither André Lacroix nor Stefan Bomhard received a vested award under the 2013 PSP or CIP. However,
for those participants who did receive an award, 65.5% of the 2013 normal PSP vested and there was a
1.31 match for each share invested into the 2013 CIP.
4. Stefan Bomhard did not receive an award under the 2014 PSP or CIP. However, for those participants
who did receive an award, 86.5% of the normal PSP vested and there was a 1.73:1 match for each share
invested into the CIP.
5. Stefan Bomhard did not receive a bonus in 2019.
6. Neither Stefan Bomhard nor Duncan Tait received a vested award under the 2018 PSP or CIP. However, for
those participants who did receive an award, 28.5% of the 2018 PSP vested and there was a 0.57:1 match
for each share invested into the 2018 CIP.
7. Duncan Tait did not receive an award under the 2019 PSP or CIP. However, for those participants who did
receive an award, 40% of the PSP vested and there was a 0.8:1 match for each share invested into the
2019 CIP.
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Group Chief Executive pay ratio
The pay ratio is based on comparing the Group Chief Executive’s pay to that of Inchcape’s
UK-based colleague population. During 2024 Inchcape completed the disposal of its UK Retail
operations, which employed most of its UK workforce, around 3,600 people. The remaining UK
colleagues are in head office roles and therefore the remuneration profile has shifted away
from customer facing commission driven reward. The Committee anticipates that the ratios
are likely to be more stable over time as the Group Chief Executive’s incentive outcomes and
colleague pay will both be dependent on Group-wide results. The ratios have decreased
significantly due to the change in workforce profile.
The ratios have decreased due to the decrease in share price (used for valuing PSP and CIP
awards) and bonus performance.
Financial year
Calculation
methodology
P25 (Lower
quartile)
P50 (median)
P75 (Upper
quartile)
2024
C
48:1
32:1
19:1
2023
C
128:1
95:1
70:1
2022
C
154:1
109:1
74:1
2021
C
75:1
55:1
38:1
2020
C
40:1
28:1
19:1
2019
C
67:1
48:1
32:1
Consistent with previous years, calculation methodology C was used.
Full-time equivalent remuneration was calculated for all UK colleagues as of 31 December
2024 using the single total figure valuation methodology, with two amendments: using 2023
bonus outcomes as a proxy for 2024 bonus outcomes and excluding SAYE grants. The
colleagues at the 25th, 50th, and 75th percentile (P25, P50, P75) were identified. The total
remuneration for 2024 of the three colleagues identified was updated after the year-end to
include any annual bonus and SAYE values (if applicable).
This method was chosen as it is in line as much as possible with methodology A, which is the
Government’s preferred approach while taking account of operational constraints. The
Committee is satisfied that the selected colleagues are representative.
The table below sets out the remuneration details for the individuals identified:
Year
Salary
CEO
P25
P50
P75
2024
Basic salary (£’000)
£885
£61
£81
£142
Total remuneration (£’000)
£4,793
£100
£149
£248
2023
Basic salary (£’000)
£859
£28
£31
£32
Total remuneration (£’000)
£4,288
£30
£41
£55
2022
Basic salary (£’000)
£820
£23
£16
£41
Total remuneration (£’000)
£4,098
£26
£38
£55
2021
Basic salary (£’000)
£799
£22
£26
£21
Total remuneration (£’000)
£2,054
£28
£37
£54
2020
Basic salary (£’000)
£759
£23
£32
£34
Total remuneration (£’000)
£939
£24
£33
£49
2019
Basic salary (£’000)
£757
£15
£28
£28
Total remuneration (£’000)
£1,639
£24
£34
£52
For 2024, the colleague at P50 is in a Finance systems role which participates in the Group
bonus plan. The Committee is satisfied that the overall picture presented by the 2024 pay
ratios is consistent with the reward policies for the new profile of Inchcape’s UK colleagues.
The Committee considers these ratios when making decisions around the Executive Director
pay packages, and Inchcape takes seriously the need to ensure competitive pay packages
across the organisation.
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Executive share ownership and Directors’ interests (audited)
The table below shows the total number of shares, options, and awards held by each Director
at 31 December 2024 or at the date of leaving if earlier. There have been no changes to this
between 31 December 2024 and 3 March 2025.
PSP/CIP awards held
SAYE options held
Shares held at
31 December
2024
Subject to
performance
conditions
Subject to
deferral
Subject to
performance
targets
Subject to
deferral
Vested but
not yet
exercised
Guideline
met
Juan Pablo Del Río*
12,837,702
n/a
n/a
n/a
n/a
n/a
n/a
Duncan Tait
491,222
997,813
0
0
3,036
0
Yes
Nigel Stein**
93,152
n/a
n/a
n/a
n/a
n/a
n/a
Adrian Lewis
73,747
335,248
0
0
4,094
0
No
Byron Grote
67,000
n/a
n/a
n/a
n/a
n/a
n/a
Jerry Buhlmann
30,783
n/a
n/a
n/a
n/a
n/a
n/a
Alison Platt
12,143
n/a
n/a
n/a
n/a
n/a
n/a
Stuart Rowley
11,000
n/a
n/a
n/a
n/a
n/a
n/a
Sarah Kuijlaars
8,000
n/a
n/a
n/a
n/a
n/a
n/a
Jane Kingston**
3,500
n/a
n/a
n/a
n/a
n/a
n/a
Alex Jensen
1,034
n/a
n/a
n/a
n/a
n/a
n/a
Nayantara Bali
0
n/a
n/a
n/a
n/a
n/a
n/a
* Juan Pablo Del Río was appointed to the Board following the acquisition of the Derco business. As part of
the agreement, the Del Río family acquired 38,513,102 shares of which Juan Pablo Del Río is the
beneficial owner of 12,837,702.
** Nigel Stein and Jane Kingston left the Group on 9 May 2024.
Share ownership policies
The Executive Directors are required to hold a fixed number of shares equivalent to 200% of
base salary. They have five years from the date of appointment to reach this shareholding.
As at 31 December 2024, using the average share price from 1 October 2024 to 31 December
2024 of 763p, Duncan Tait held 423% of salary (his date of appointment was June 2020) and
Adrian Lewis held 113% of salary (his date of appointment was May 2023).
Other directorships
The Executive Directors are generally permitted to take one non-executive directorship as
long as it does not lead to conflicts of interest or undue time commitment and is approved in
advance by the Nomination Committee and the Board.
Duncan Tait currently serves as a non-executive director on the board of Agilisys Ltd for which
he received a fee of £25,000 during 2024.
Service contracts
The Company’s policy is for Executive Directors’ service contract notice periods to be no
longer than 12 months, except in exceptional circumstances. All current contracts contain
notice periods of 12 months.
Name
Date of contract
Notice period
Unexpired term
Duncan Tait
1 June 2020
12 months
To retirement
Adrian Lewis
24 May 2023
12 months
To retirement
The Company may, at its discretion, and in certain circumstances, pay a sum equal to the
outstanding notice period. Service contracts are available to view at the Company’s
registered office.
Relative importance of spend on pay
The chart shows the percentage change in total colleague pay expenditure and shareholder
distributions (i.e. dividends and share buybacks) from 2023 to 2024.
Relative importance of spend on pay (£m)
£128
£0
£624
£147
£151
£605
2023
2024
Dividend
Share buyback
Colleague remuneration from
continuing operations
£0
£100
£200
£300
£400
£500
£600
£700
The Directors are proposing a final dividend for 2024 of 17.2p per share (2023: 24.3p).
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15%
-3%
Percentage change in Board remuneration
The table shows the percentage change in Board remuneration, compared with the average percentage change in remuneration for senior management. For the purposes of this disclosure,
remuneration comprises salary, benefits (excluding pension), and annual bonus only. The increase for Non-Executive Directors relates to base fees only. There were no changes to the additional
fees for chairing a Committee.
% change for 2020
% change for 2021
% change for 2022
% change for 2023
% change for 2024
Salary
Benefits
Bonus
Salary
Benefits
Bonus
Salary
Benefits
Bonus
Salary
Benefits
Bonus
Salary
Benefits
Bonus
Executive Directors
Duncan Tait
n/a
n/a
n/a
2.5 %
0 %
100 %
3.5 %
0 %
5.5 %
5 %
0 %
(30) %
2.5 %
0 %
9 %
Adrian Lewis
-
-
-
-
-
-
-
-
-
n/a
n/a
n/a
3 %
0 %
14 %
Non-Executive Directors
Nigel Stein
2 %
0 %
n/a
2.5 %
0 %
n/a
3.5 %
0 %
n/a
4 %
0 %
n/a
2.5 %
n/a
n/a
Jerry Buhlmann*
0 %
n/a
n/a
2.5 %
n/a
n/a
3.5 %
n/a
n/a
4 %
n/a
n/a
313 %
100 %
n/a
Alex Jensen
0 %
n/a
n/a
2.5 %
n/a
n/a
3.5 %
n/a
n/a
4 %
n/a
n/a
2.5 %
n/a
n/a
Jane Kingston
0 %
n/a
n/a
2.5 %
n/a
n/a
3.5 %
n/a
n/a
4 %
n/a
n/a
2.5 %
n/a
n/a
Nayantara Bali
n/a
n/a
n/a
0 %
n/a
n/a
3.5 %
n/a
n/a
4 %
n/a
n/a
2.5 %
n/a
n/a
Sarah Kuijlaars
-
-
-
-
-
-
3.5 %
n/a
n/a
4 %
n/a
n/a
2.5 %
n/a
n/a
Juan P. Del Río
-
-
-
-
-
-
-
-
-
4 %
n/a
n/a
2.5 %
n/a
n/a
Byron Grote
-
-
-
-
-
-
-
-
-
4 %
n/a
n/a
2.5 %
n/a
n/a
Stuart Rowley
-
-
-
-
-
-
-
-
-
n/a
n/a
n/a
2.5 %
n/a
n/a
Alison Platt
-
-
-
-
-
-
-
-
-
-
-
-
n/a
n/a
n/a
Average senior manager pay
3.2 %
0 %
82.9 %
3.3 %
0 %
73.2 %
5.8 %
0 %
9.5 %
7.7 %
0 % (35.2) %
3 %
0 %
14.9 %
*In May 2024, Jerry Buhlmann changed role from Senior Independent Director to Chairman which resulted in an annual fee increase, as well as being eligible for medical cover.
As Inchcape plc has no direct employees, colleagues representing the most senior Executives have been selected as this group is large enough to provide a robust comparison, while also
providing data that is readily available on a matched sample basis. These colleagues also participate in bonus schemes of a similar nature to the Executive Directors and therefore remuneration
will be similarly influenced by Company performance.
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Statement of implementation for 2025
This section provides an overview of how the Committee is proposing to implement the Policy in
2025. Further details on the Committee’s rationale is given in the letter of shareholders on pages
91 to 93 of this report.
Base salary
Salaries are reviewed annually and increases usually take effect from 1 April. For 2025, the
Group Chief Executive will receive an increase of 7% giving an annual salary of £952,965 and
the Group Chief Financial Officer will receive an increase of 2.7%, giving an annual salary of
£507,749.
In determining the increase for the Group Chief Executive, which is above the UK workforce
average, the Committee considered his strong performance and leaderships and significant
contribution to the Accelerate strategy, and the ongoing commitment to achievement of the
Accelerate+ strategy. The Committee also believes that the increase reflects the attractiveness
of his skill set in the market and the challenges Inchcape faces in recruiting and retaining
executives, noting its unique position as the world's leading automotive Distributor.
The increase for the Group Chief Financial Officer is below the average UK workforce
salary increase.
Pension
Proposed pension is 10% of salary in line with UK workforce average.
Annual bonus
The maximum bonus opportunity for will remain unchanged from previous years at 150% of
salary. For the Executive Directors, 60% of the bonus will be based on a financial performance
matrix, linked to revenue and profit before tax, 20% will be based on working capital, and 20%
will be based on specific, measurable objectives that relate to the Group’s strategy, including
a stretching carbon reduction target linked to the Group’s responsible business framework.
Any payments of the working capital and strategic objectives is subject to the revenue and
profit before tax thresholds being met. For target performance, the payout will be 50% of the
maximum bonus opportunity.
Long-term incentives
For 2025, the Executive Directors will receive a normal PSP award of 180% of salary based on
performance metrics of 40% EPS, 40% ROCE, and 20% cash conversion. An incremental one-off
PSP of 70% of salary tied to EPS performance will also be granted in 2025. The overall PSP for
2025 only will thus be 250%.
No changes are being proposed for the CIP award level in 2025.
Performance targets for 2025
Normal PSP and CIP
Three-year cumulative EPS (40%
weighting)
Vesting %
Three-year average ROCE
(40% weighting)
Vesting %
Less than 228p
0 %
Less than 23%
0 %
228p
25 %
23%
25 %
256p
100 %
30%
100 %
Between 228p and 256p
Straight line basis
Between 23% and 30%
Straight line basis
Cash conversion (20% weighting)
Vesting %
Less than 85%
0 %
85%
25 %
105%
100 %
Between 85% and 105%
Straight line basis
The one-off PSP award is subject to a significantly more stretching EPS performance target
which will only begin to vest if superior EPS growth over the next three years is delivered. The
Committee will continue to consider the underlying financial performance of the business, as
well as the value added to shareholders when assessing performance.
One-off PSP award
Three-year cumulative EPS (40%
weighting)
Vesting %
Less than 256p
0 %
256p
25 %
277p
100 %
Between 256p and 277p
Straight line basis
Chairman and Non-Executive Director fees
For 2025, a fee increase of 3% is being proposed giving the Chairman an annual fee of
£380,197, the Senior Independent Director an annual fee of £93,705, and Non-Executive
Directors an annual fee of £72,219. The Chairs of the Audit, Remuneration, and Sustainability
Committees receive an additional fee of £17,500 per annum.
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Governance matters
Shareholder context
The table below shows the advisory vote on the Directors’ Remuneration Report at the Annual
General Meeting held on 9 May 2024:
Total number of votes
% of votes cast
For (including discretionary)
347,950,560
98.75 %
Against
4,396,635
1.25 %
Total votes cast (excluding votes withheld)
352,347,195
100.00 %
Votes withheld
3,034,553
Total votes cast including votes withheld
355,381,748
The table below shows the binding vote on the Directors’ Remuneration Policy at the Annual
General Meeting held on 18 May 2023:
Total of votes
% of votes cast
For (including discretionary)
349,306,482
96.07 %
Against
14,288,011
3.93 %
Total votes cast (excluding votes withheld)
363,594,493
100.00 %
Votes withheld
197,020
Total votes cast including votes withheld
363,791,513
Withheld votes are not included in the final proxy figures as they are not recognised as a vote
in law.
Discretion
The Committee retains discretion to adjust the annual bonus outcome up or down to ensure
that it is a fair reflection of the Group’s underlying performance. The Committee also has the
ability to adjust the number of shares vesting under the PSP and CIP to ensure it is a fair
reflection of underlying performance during the performance period and to adjust the
performance conditions for long-term incentive plans in exceptional circumstances, provided
the new conditions are no tougher or easier than the original conditions.
Any discretion exercised by the Committee in the adjustment of performance conditions will be
fully explained to shareholders in the relevant Annual Report on Remuneration. If the discretion
is material and upwards, the Committee will consult with major shareholders in advance.
Malus and clawback
The Group’s malus and clawback policy is designed to provide guidance and define whether
malus and/or clawback events have been triggered and how and when discretion would be
applied to the outcomes of the Inchcape incentive plans. The Committee has discretion to
reduce bonus, PSP and/or CIP, cancel entitlement of bonus, prevent vesting of PSP and/or
CIP, or allow the Company to claim back up to 100% of the award.
Malus can be applied at any point period to the payment or vesting date for long-term
incentives and clawback can be applied up to two years from the payment date for a
cash payment or from the vesting of a share award.
The following events may trigger a malus or clawback include:
• Ceases to be a director or employee by reason of misconduct.
• Financial restatements.
• Error in the calculation.
• Material violations of Company policies or codes of conduct.
• Breach of fiduciary duty or employment terms and conditions.
• Corporate failure as a result of the misuse of Company assets or resources.
There have been no events during 2024 which would trigger the malus and clawback
provisions for the Executive Directors.
Advisors to the Committee
The Committee decided to carry out a tender for a new remuneration advisor during the year
to ensure that the Committee’s approach to executive compensation remains competitive,
compliant, aligned to stakeholder interests, and support the delivery of the Accelerate+
strategy. Four providers were invited to present to the Committee each providing a written
proposal, with supporting documents including case studies to demonstrate their knowledge,
experience, and expertise. Following the process WTW were appointed with effect from
September 2024. Prior to that Ellason LLP was the Committee’s advisor.
WTW was paid a fee of £126,606 and Ellason LLP was paid a fee of £63,760 for its services
relating to directors’ remuneration during 2024. Ellason LLP did not provide advice or services
to the Company on any others matters. Both WTW and Ellason LLP are signatories to the
Remuneration Consultant Group’s Code of Conduct which sets out guidelines to ensure that
any advice is independent and free of undue influence (this can be found at
www.remunerationconsultantsgroup.com). None of the individual Directors has a personal
connection with WTW or Ellason LLP.
The Committee is satisfied that the advice it receives is objective and independent and
confirms that WTW does not have any connection with the Company that may impair their
independence. The Committee’s advisors attend Committee meetings as required and
provide advice on remuneration for Executives, analysis of the Directors’ Remuneration Policy,
and regular market and best practice updates. The advisors report directly to the Committee
Chair. Fees are charged at an hourly rate in accordance with the terms and conditions set out
in the relevant engagement letter.
The Directors’ Report on Remuneration was approved by the Board and has been signed by
Byron Grote on its behalf.
Byron Grote
Chair of the Remuneration Committee
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The 2024 Annual Report and Accounts is prepared with
reference to the UK Corporate Governance Code 2018
(Code) which is published by the Financial Reporting Council
(FRC) and available at www.frc.org.uk.
The Corporate Governance Report on pages 62 to 115, and
the compliance statement on the following pages, gives
details of how the Code has been complied with throughout
the year and gives references to where key content can be
found elsewhere in the Annual Report.
We have complied with all Code provisions throughout the
year ended 31 December 2024.
1. BOARD LEADERSHIP AND COMPANY PURPOSE
A. Board’s role
The primary role of the Board is to lead Inchcape in a way
that ensures long-term success whilst generating value for
shareholders and contributing to wider society. To achieve
this goal the Board considers how the business model creates
sustainable value and what risks or opportunities could
impact future success over the short, medium and long-term.
The Board’s governance framework is designed to provide
clear accountability for the Board, support the Board’s
oversight of internal and external developments, enable it to
take informed decisions, and to provide effective challenge
which ensures the long-term success of the Group.
BOARD ACTIVITIES, SEE PAGES 72 TO 77.
SUSTAINABILITY, SEE PAGES 32 TO 34.
GOVERNANCE FRAMEWORK, SEE PAGE 63.
B. Purpose, culture, and strategy
The Board is responsible for defining the Company’s purpose
and setting strategy to deliver it. The Group’s purpose is well
defined, and is clearly understood by both investors and
colleagues. This purpose of bringing mobility to the world’s
communities for today, for tomorrow, and for the better is
integral to the development of the Group’s strategy.
The Board meets to review and define strategy annually at its
dedicated strategy event. When defining strategy the Board
has regard for trends and factors which may impact the
strategic objectives which included discussions on the role of
automotive distributors and OEM relationships, the ability to
support the mobility transition, and whether the practices
and behaviours within the Group are aligned to the purpose.
The Board also carries out a six monthly assessment of
strategy to consider whether there are any material
developments in the trends and factors which may impact
the strategic goals.
The Board is updated on strategic progress against an agreed
set of key performance indicators throughout the year which
include both financial and non-financial metrics such as
colleague experience, data and analytics, and M&A growth.
Achievement of strategy is underpinned by the One Inchcape
Values & Behaviours which define the Group’s culture. The
Board sets the tone from the top and there is a strong
programme of colleague engagement from both the Group
Executive Team and the Non-Executive Directors (NEDs).
The Board monitors culture through a variety of channels
throughout the year to develop further insight into
behaviours including NED engagement sessions, compliance
and Internal Audit reports, and during its dedicated People
Board session during which the results of the Be Heard survey
are analysed.
STRATEGY, SEE PAGES 18 TO 22.
PEOPLE AND CULTURE, SEE PAGE 76.
C. Resources and controls
When setting strategy, and during its monitoring activities
throughout the year, the Board considers whether there are
the necessary resources in place to meet the strategic
objectives. This includes considering the skills and capabilities
of the workforce needed to deliver strategy as well as the
financial needs of the Group. To operate effectively there is
a framework of controls in place, and the Board considers
their effectiveness of a continual basis.
The Board sets the risk appetite the Group is willing to take to
meet its strategic objectives, agrees the principal risks to the
strategy, and oversees the system of internal control. The
Audit Committee has delegated authority for ensuring the
effectiveness of the risk management and internal control
framework and reports to the Board as appropriate.
D. Stakeholder engagement
Dialogue with key stakeholders is vital for the Board to ensure
that the Group’s purpose, strategy, and culture are clearly
understood and is delivering value. The directors have an
annual schedule of investor, colleague and OEM
engagement events which range from one to one meetings,
webinars, conferences, and the ‘in the driving seat’
investor events.
The Board receive regular updates from the Investor
Relations team and analysts reports are also circulated for
review. Feedback from investors is communicated to the
Board so they are aware of the shareholder view of the
Group’s strategy and business performance.
The Chair met with eight of the 16 largest shareholders to
discuss the Board’s governance and the strategic ambitions.
The Chair of the Remuneration Committee also contacted
the Company’s largest shareholders to discuss approach to
remuneration and reward performance.
It is challenging to meet all shareholders and the Board
encourages attendance at the Annual General meeting as
the forum for shareholders to engage with the full Board.
STAKEHOLDER ENGAGEMENT, SEE PAGES 14, 15, AND 75.
E. Workplace policies
The Group’s culture is embedded through the policy
framework. This framework includes reward policies and
incentive schemes, health, safety, and wellbeing, Speak Up!
and a comprehensive annual training programme, which
together reinforce the desired culture allowing colleagues to
thrive. The Code of Conduct sets out the behaviours
expected of our colleagues. The Board approves the Code
of Conduct every two years to ensure that it remains in line
with the One Inchcape Values & Behaviours and monitors
the completion rates of the mandatory training. The Directors
also complete the Code of Conduct training. The Board has
delegated oversight of Speak Up!, the Company’s external
hosted whistleblowing hotline to the Audit Committee who
receive updates throughout the year. Any significant issues
are reported by the Chair of the Audit Committee to
the Board.
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2. DIVISION OF RESPONSIBILITIES
F. Chair
The Chair leads the Board and nurtures a culture in which
informed and transparent decision-making takes place. He
sets the tone from the top and Board meetings are designed
to encourage constructive debate and promote a culture of
openness and inclusion.
G. Board composition, independence, and division of
responsibilities
As at 31 December 2024, the Board comprised the
Chairman, seven NEDs, and two Executive Directors.
There are clear divisions between Executive and Non-
Executive responsibilities. The roles of Chairman and Group
Chief Executive are separately held and their responsibilities
are well defined. The Chairman and the Group Chief
Executive maintain regular dialogue to ensure information
flows to the Board effectively. The Chairman and the other
NEDs meet outside of the formal Board meeting schedule
in order to obtain further insight into the Group’s
day-to-day operations.
The Senior Independent Director acts as a sounding board
for the Chairman, to serve as an intermediary to other Board
members, and is available to shareholders should they wish.
The Senior Independent Director leads the annual NED only
meeting during which they appraise the performance of
the Chairman.
NEDs can obtain independent professional advice, at the
Company’s expense, in the performance of their duties. All
Directors have access to the advice and services of the
Group Company Secretary, whose appointment and
removal are matters reserved for the Board.
Where Directors have a concern about the operation of the
Board or management, it will be formally recorded in the
minutes. No such concerns arose in 2024.
The independence of the Board is a matter of utmost
importance given the vital role NEDs play in scrutinising the
performance of management and holding individual
Executive Directors to account against agreed performance
objectives. The independence of each NED is formally
reviewed by the Nomination Committee on an annual basis.
Particular focus is applied to Directors who have served over
six years on the Board, to ensure that these Directors continue
to demonstrate independent character, judgment,
and objectivity.
The Chairman was considered to be independent upon
appointment and all of the NEDs who served during 2024
were considered by the Board to be independent for the
purposes of the Code, except for Juan Pablo Del Río who
holds a significant shareholding in the Company and has
close ties with the Derco business acquired in 2023.
Alison Platt and Byron Grote both served on the board of
Inchcape and Tesco plc for the first half of 2024. Byron Grote
stepped down from the board of Tesco plc in June 2024 and
Alison Platt will step down in 2025. The Nomination Committee
considered this prior to recommending the appointment of
the Directors and the Board were satisfied that there were
no conflicts of interest which could have impeded
their independence.
The Board has a Conflicts of Interest Policy to identify,
authorise, and manage conflicts of interest. A Director is
required to give notice to the Company of any conflict or
potential conflict which is duly recorded in the Conflicts of
Interest Register. The policy was operated throughout the
year and no conflicts were recorded.
The Group Company Secretary manages the Conflicts of
Interest Register which is regularly reviewed by the Board.
New Directors are informed of the process during the
induction, and briefed on potential conflicts such as those
presented by Directors having roles on the boards of
other companies.
The Nomination Committee and Board consider that there is
no business or other circumstances that are likely to affect
the independence of any NED and that all Directors
continue to demonstrate independence.
DIVISION OF RESPONSIBILITIES, SEE PAGE 65.
NOMINATION COMMITTEE REPORT, SEE PAGES 78 TO 80.
H. NEDs’ role and time commitment
Directors are permitted to hold external directorships and
other outside business interests as greater boardroom
exposure provides significant benefit to the skills, experience,
and knowledge of the Board.
The nature and number of external positions is governed by
the Board’s Policy on Multiple Board Appointments to ensure
that any additional appointments will not adversely impact
the time commitment to their role at Inchcape, and to
ensure that all of our Board members remain compliant
with applicable shareholder advisory groups’ guidance
on ‘overboarding’.
Approvals were sought during the year for Directors and due
consideration was given to any potential conflicts of interest
and ability to devote sufficient time to the Company before
consent was granted. Details of the Directors’ external
directorships can be found in their biographies.
The Nomination Committee also reviews the time
commitment required of the NEDs on an annual basis and
has concluded that they continue to have sufficient time to
discharge their responsibilities. The NEDs also spent time
outside of the scheduled Board meetings to meet with
management and other colleagues, provided mentoring,
and also participated as guest speakers at various initiatives
including the Women into Leadership programme.
BOARD BIOGRAPHIES, SEE PAGES 66 TO 68.
NOMINATION COMMITTEE REPORT, SEE PAGES 78 TO 80.
I. Company Secretary
The Group Company Secretary ensures the Board comply
with its governance framework, supports the development of
the annual board schedule and meeting agendas with the
Chairman and Group Chief Executive, and ensures there is
sufficient time and resource to allow the Board to discharge
its duties effectively. The Group Company Secretary is also
responsible for coordinating the effectiveness evaluation of
the Board in conjunction with the Chairman.
DIVISION OF RESPONSIBILITIES, SEE PAGE 65.
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3. COMPOSITION, SUCCESSION AND EVALUATION
J. Appointments and succession planning
The Chairman, Senior Independent Director, and NEDs are
each appointed for a three-year term, subject to annual re-
election by shareholders. Following each three-year term,
the contribution of each director is considered by the
Nomination Committee to ensure their appointment remains
appropriate for the Board and the Group. Directors serving
over six years on the Board are subject to a particularly
rigorous review.
Ensuring there is the right mix of individuals on the Board to
support, and challenge, management, to avoid group think
and to make the right decisions to facilitate the long-term
success of the Group is a key element of the succession
planning process.
The composition and effectiveness of the Board are subject
to regular review by the Nomination Committee which, in
particular, considers the balance of skills, tenure, experience,
and independence of the Board, in accordance with the
Board Diversity Policy, which is available at
www.inchcape.com.
The Chair carried out individual evaluations with each
Director to discuss their contribution, effectiveness, and
development needs. The Senior Independent Director led
the discussion on the Chairman’s performance and provided
feedback on themes to be addressed in 2025.
Any new appointments to the Board result from a formal,
rigorous, and transparent procedure, responsibility for which
is delegated to the Nomination Committee.
NOMINATION COMMITTEE REPORT, SEE PAGES 78 TO 80.
K. Skills, experience, and knowledge
An appropriate combination of skills, knowledge, and
experience is imperative to ensuring the Board is effective in
leading the Company and overseeing the successful
execution of strategy.
The Board consists of several Board members from outside
the traditional UK plc environment and from a variety of
different sectors with a good balance of new and longer
serving directors. This combination of knowledge and
experience adds to diversity of thought during the Board’s
deliberations on strategy and enables the Board to fully
understand the business and the risks associated with the
Regions in which Inchcape operates.
To continually improve knowledge and understanding, the
Directors undertake deep dive sessions on particular aspects
of strategy throughout the year. During 2024, these sessions
focused on Digital, Data and Analytics. The aim of the
training sessions is to refresh and expand the Board’s
knowledge and skills. In doing so, the Directors can
contribute to discussions on technical and regulatory matters
more effectively. The sessions also serve as an opportunity for
the Board to discuss strategy, performance, and risks with
management below the Group Executive Team level and
gain further direct insight into our businesses and
management capability.
Professional advisers and subject matter experts are also
invited to provide in-depth updates on certain aspects of the
business or strategy throughout the year. These updates aim
to cover a range of strategic issues including, but not limited
to, environmental deep dives, the economic and political
environment, sustainability, technology and innovation. The
Group Company Secretary also provides regular updates to
the Board and its Committees on regulatory and corporate
governance matters.
BIOGRAPHIES, SEE PAGES 66 TO 68.
SKILLS, SEE PAGE 64.
KNOWLEDGE, SEE PAGE 75.
L. Board performance evaluation
The Board monitors and improves performance by reflecting
on the continuing effectiveness of its activities, the quality of
its decisions, and by considering the individual and collective
contribution made by each Board member.
The NEDs, led by the Senior Independent Director, reviews
the performance of the Chairman. They concluded his
leadership, performance, and contribution to be of a high
standard since he assumed the role.
PERFORMANCE, SEE PAGE 71.
4. AUDIT, RISK AND INTERNAL CONTROL
M. Internal and external audit
The Internal Audit function plays an important role by
providing independent and objective assurance to
management, the Audit Committee, and Board on the
effectiveness of the Group’s risk management activities,
internal controls, and corporate governance framework. The
Audit Committee assesses the effectiveness of Internal Audit
on a continual basis and reviews the outcomes of the annual
Internal Audit effectiveness review. The Head of Internal
Audit reports directly to the Chair of the Audit Committee to
ensure independence.
The Audit Committee further oversees Inchcape’s relationship
with the External Auditor to ensure that the independence,
quality, rigour, and challenge of the external audit process is
maintained. The Committee regularly meets with the External
Auditor without the presence of management to discuss any
areas of concern they might have.
The Audit Committee reviews significant financial
judgements prior to the release of the full year and half year
results to assess the integrity of the financial and narrative
statements made.
AUDIT COMMITTEE REPORT, SEE PAGES 81 TO 88.
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N. Fair, balanced, and understandable assessment
The Board considers the weight given to published
information to ensure that it is balanced and there are no
omissions. The Board also ensures that the narrative reporting
is consistent with the financial statements.
This assessment is supported by internal and external
assurance which the Board and Audit Committee consider
throughout the year.
The Board is satisfied that the Annual Report taken as a
whole is fair, balanced, and understandable and provides
the information necessary for shareholders to assess the
Group’s position and performance, business model,
and strategy.
FAIR, BALANCED, & UNDERSTANDABLE STATEMENT, SEE PAGES 84 AND 115.
O. Risk management
Inchcape’s Risk Management Framework is designed to
manage rather than eliminate the risk of failure to achieve
business objectives. It can only therefore provide reasonable
and not absolute assurance against material misstatement
or loss.
The Board has a risk review process which consists of:
• annual review and approval of the Risk Policy;
• six monthly assessments of the Group’s principal and
emerging risks; and
• annual review of the risk appetite.
In establishing and reviewing the system of internal control,
the Directors have regard for the nature and extent of
relevant risks, the likelihood of loss being incurred, and the
costs of control. The system can only provide reasonable, but
not absolute, assurance against material misstatement or loss
and cannot eliminate business risk.
The Audit Committee carry out a review of the effectiveness
of risk management and internal control, on behalf of the
Board, with any significant control failings or weaknesses
reported to the Board, with a detailed review of the findings
and mitigation plans being put in place. The Board monitor
progress against plans until it is satisfied that the matter has
been resolved appropriately.
The Directors are satisfied that the Group’s risk management
and internal control systems accord with the FRC’s Guidance
on Risk Management, Internal Control and Related Financial
and Business Reporting.
PRINCIPAL RISKS, SEE PAGES 52 TO 58.
5. REMUNERATION
P. Remuneration policies and practices
The Remuneration Committee is responsible for determining
and agreeing the Remuneration Policy (Policy) for Executive
remuneration and reviewing its ongoing appropriateness
and relevance.
When considering the Policy, the Committee ensures
remuneration is strongly aligned to Inchcape’s purpose and
strategy, encourages the right behaviours, and rewards
individual contributions towards the success of Inchcape.
The Chair of the Remuneration Committee reports to the
Board following each meeting.
The Policy was approved with over 96% of shareholders
support at the Annual General Meeting held on 18 May 2023.
The Policy applies for a three year period, after which a
Policy review will carried out by the Remuneration
Committee. The revised Policy will be submitted for
shareholder approval at the 2026 Annual General Meeting.
The current Policy is provided in full in the 2023 Annual Report.
DIRECTORS’ REPORT ON REMUNERATION, SEE PAGES 91 TO 106.
Q. Developing Executive Remuneration Policy
There is a clear procedure in place to develop the Policy
which takes into account shareholder expectations, market
best practice, and benchmarking. The Remuneration
Committee is supported by external advisors to provide
guidance on the development of the Policy and to provide
an independent view to aid the Committee’s discussions.
The Policy is structured to ensure that Inchcape has enough
flexibility to attract and retain appropriate talent to deliver
the Accelerate+ strategy and takes into account the
evolution of the Group’s strategic direction as it moves into
new Markets and technologies.
In setting the Policy, the Remuneration Committee obtains
the views of a range of stakeholders through a combination
of consultation, individual meetings, and colleague
engagement sessions.
No Director determines their own remuneration.
DIRECTORS’ REPORT ON REMUNERATION, SEE PAGES 91 TO 106.
R. Remuneration outcomes and independent judgement
The Remuneration Committee is comprised of independent
NEDs to ensure independence. When agreeing Executive
remuneration outcomes, the Remuneration Committee uses
its independent judgement to reach its decisions taking into
account financial performance, personal objectives, wider
business context, and long-term impacts.
The Remuneration Committee will review the
appropriateness of the targets on a continual basis and will
make any adjustments it feels necessary to reflect the impact
of business decisions, such as M&A. At the end of each
performance period, the Remuneration Committee will
consider remuneration outcomes to ensure that reward is not
being received for formulaic outcomes rather than
performance. Advice is received from internal and external
sources which aid the Committee’s decision making process.
The external remuneration advisors adhere to the
Remuneration Consultants’ Group Code of Conduct.
DIRECTORS’ REPORT ON REMUNERATION, SEE PAGES 91 TO 106.
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The Directors’ Report for the year ended 31 December 2024
comprises pages 111 to 115 of this report together with
sections incorporated by reference.
Information required in the Management Report under DTR
4.1.8 can be found in the following sections: a review of the
business and future developments on pages 2 to 51; principal
risks and uncertainties on pages 52 to 61; a description of the
Board’s activities and the structure of its Committees is given
on pages 62 to 77; and, a description of the Group’s internal
control and risk management framework is given on pages
81 to 88.
Corporate governance statement
The statement of compliance with the UK Corporate
Governance Code 2018 (Code) is given on pages 107 to
110 . The Code is published on the Financial Reporting
Council’s website www.frc.org.uk. Information required under
DTR 7 is given in the Corporate Governance Report on pages
62 to 115.
Board of Directors
The Directors of the Company below were in office during
the year and up to the date of signing the financial
statements:
• Nayantara Bali
• Jerry Buhlmann
• Juan Pablo Del Río
• Byron Grote
• Alex Jensen
• Jane Kingston (left May 2024)
• Sarah Kuijlaars
• Adrian Lewis
• Alison Platt (joined January 2024)
• Stuart Rowley
• Nigel Stein (left May 2024)
• Duncan Tait
In accordance with the Code, as at the date of this report,
all Directors will stand for re-election at the Annual General
Meeting (AGM) on 15 May 2025. The Chairman has reviewed
the performance of each Director and is satisfied that each
continues to be effective and demonstrates commitment to
the role. The appointment and replacement of Directors is
governed by the Company’s Articles of Association (Articles),
the Code, the Companies Act 2006, and related legislation.
The Articles are available on the Company’s website. The
Articles were not amended during the year.
Subject to the Articles, the Code, and relevant legislation,
the business of the Company is managed by the Board
which may exercise all the powers of the Company.
Global Inclusion & Diversity (I&D) standards are upheld
through policy development and committing to regularly
tracking and measuring the impact of related initiatives and
programmes. An extended Inclusive Leadership Programme
is ran for our senior leaders to ensure inclusivity is embedded
right across management. A range of I&D toolkits are
developed to empower our colleagues right across the
business in creating an inclusive environment. These have
been developed in partnership with our colleagues and
enable everyone to consider I&D within their daily actions
and decisions. The Board and its Committees act in
accordance with the Board Diversity Policy.
In 2024, the Company set a target of having 23% of its senior
management team working in the UK to be from ethnic
minority backgrounds by 2027.
Shareholders
Engagement with shareholders is important to the Company
so that we are able to understand the key issues of
importance to them and get their views on the business. Any
updates regarding the business, including presentations by the
Group Chief Executive, are available at www.inchcape.com
so that all shareholders have access to the same Company
information at the same time. Further information on
stakeholder engagement can be found on pages 14 to 15.
As our 20 largest shareholders own over 69% of the business,
shareholder consultations, such as the Directors’
Remuneration Policy, are carried out with this group.
Extending the consultation to all shareholders would not be
cost effective, and shareholders not involved in the
consultation process are encouraged to use the AGM forum
to express their views either by asking questions or voting on
the relevant resolutions.
Conflicts of interest
The Articles permit the Board to authorise any matter which
would otherwise involve a Director breaching their duty
under the Companies Act 2006 to avoid conflicts of interest.
When authorising a conflict of interest, the Board must do so
without the conflicting Director counting as part of the
quorum. In the event that the Board considers it appropriate,
the conflicted Director may be permitted to participate in
the debate but will be permitted neither to vote nor count in
the quorum when the decision is being agreed. The Directors
are aware that it is their responsibility to inform the Board of
any potential conflicts as soon as possible and procedures
are in place to facilitate disclosure.
Directors’ indemnity
A qualifying third-party indemnity (QTPI), as permitted by the
Articles and sections 232 and 234 of the Companies Act
2006, has been granted by the Company to each of the
Directors of the Company.
Under the provisions of the QTPI, the Company undertakes to
indemnify each Director against liability to third parties
(excluding criminal and regulatory penalties) and to pay
Directors’ costs as incurred, provided that they are
reimbursed to the Company if the Director is found guilty or,
in an action brought by the Company, judgement is given
against the Director. The indemnity has been in force for the
year ended 31 December 2024 and until the date of
approval of this report. The indemnity also covers the
statutory directors of the Group’s subsidiaries.
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Results and dividends
The Group’s audited consolidated financial statements for
the year ended 31 December 2024 are shown on pages 116
to 210. The level of distributable reserves is sufficient to pay
a dividend.
The Board recommends a final ordinary dividend of 17.2p per
ordinary share. If approved at the 2025 AGM, the final
ordinary dividend will be paid on 16 June 2025 to
shareholders registered in the books of the Company at the
close of business on 2 May 2025.
The Company may, by ordinary resolution, declare a
dividend not exceeding the amount recommended by the
Board. Subject to the Companies Act 2006, the Board may
pay interim dividends when the financial position of the
Company, in the opinion of the Board, justifies its payment.
Share capital
As at 31 December 2024, the Company’s issued share
capital of £39,443,652.80 comprised 394,436,528 ordinary
shares of 10p. Holders of ordinary shares are entitled to
receive the Company’s Annual Report and Accounts, to
attend and speak at General Meetings, and to appoint
proxies and exercise voting rights. The shares do not carry
any special rights with regard to control of the Company.
The rights are set out in the Articles.
Restrictions on transfer of securities
There are no restrictions or limitations on the holding of
ordinary shares and no requirements for prior approval of any
transfers. There are no known arrangements under which
financial rights are held by a person other than the holder of
the shares. Shares acquired through the Company share
schemes rank pari passu with the shares in issue and have no
special rights.
Authority to purchase shares
At the Company’s AGM on 9 May 2024, the Company was
authorised to make market purchases of up to 41,300,713
ordinary shares, representing approximately 10% of its issued
share capital.
In the year ended 31 December 2024, the Company
purchased for cancellation 18,673,960 ordinary shares of 10p
each at a cost of £146,682,138.83, representing 4.7% of the
issued share capital as at that date.
The Directors have authority to issue and allot ordinary shares
pursuant to the Articles and shareholder authority is
requested at each AGM. The Directors have authority to
make market purchases for ordinary shares and this authority
is also renewed annually at the AGM.
Interests in voting rights
Notifications received by the Company in accordance with
DTR 5 are published on a regulatory information service and
are available on the Company’s website. During the year,
the Company received notifications in accordance with the
Financial Conduct Authority Disclosure and Transparency
Rules of the following notifiable interests in the voting rights in
the Company’s issued share capital:
As at 31 December 2024
As at 3 March 2025
Shareholder
Number of
voting rights
held
Percentage
of voting
rights held
Number of
voting rights
held
Percentage
of voting
rights held
FMR LLC
20,228,539
5.09 %
22,785,750
5.78 %
The Capital
Group
Companies,
Inc
20,683,111
5.00 %
20,683,111
5.00 %
BlackRock, Inc
16,719,949
4.24 %
16,719,949
4.24 %
Polaris Capital
Management
LLC
11,973,849
2.90 %
11,973,849
2.90 %
Restrictions on voting rights
There are no restrictions on voting rights.
Employee benefit trust
The Executive Directors of the Company, together with other
colleagues of the Group, are potential beneficiaries of the
Inchcape Employee Trust (Trust) and, as such, are deemed
to be interested in any ordinary shares held by the Trust.
At 31 December 2024, the Trust’s shareholding totalled
322,859 ordinary shares.
All authorised requests to exercise shares are processed by
the Trust on behalf of the relevant employees.
In respect of UK Listing Rule 6.6.1, the trustee of the Trust
agrees to waive dividends payable on the shares it holds for
satisfying awards under the various share plans in 2024 and
for future dividends in the foreseeable future.
Directors’ interests
The table showing the beneficial interests, including family
interests, in the ordinary shares of the Company of the
persons who were Directors at 31 December 2024 is shown in
the Directors’ Report on Remuneration on page 103. There
have been no changes to the interests or number of shares
held by each Director between 31 December 2024 and
3 March 2025.
Change of control
The Company is not party to any significant agreements that
would take effect, alter, or terminate upon a change of
control of the Company following a takeover bid apart from
certain of the Group’s third-party funding arrangements
which would terminate upon a change of control of the
Company, such as the Group’s revolving credit facility
agreement. Further details are given in note 22 to the
financial statements on pages 171 to 173.
The Group’s relationships with its OEMs are managed at
Group level, but the relevant contracts are entered into at a
local level with day-to-day management being led by each
operating business. Certain contracts may terminate on a
change of control of the local contracting company.
The Company does not have agreements with any Director
or colleague providing compensation for loss of office or
employment that occurs because of a takeover bid, except
for provisions in the rules of the Company’s share schemes
which may result in options or awards granted to colleagues
to vest on a takeover.
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Transactions with Directors
No transaction, arrangement, or agreement, other than remuneration, required to be disclosed in terms of the Companies
Act 2006 and IAS 24, ‘Related Parties’ was outstanding at 31 December 2024, or was entered into during the year for any
Director and/or connected person other than lease payments of £7m (2023: £7m) which were made to companies
connected with Juan Pablo Del Río.
Streamlined Energy and Carbon Reporting Regulations
The annual quantity of emissions of carbon dioxide equivalent from activities for which the Company is responsible, and
the methodologies and ratios used to calculate this, are shown on page 50.
Principal financial risk factors
These risks are shown on pages 52 to 58.
Other information – Listing Rules
The information required to be disclosed by UK Listing Rule 6.6.1 can be found on the pages set out below:
Section
Information
Page
(1)
Interest capitalised
Not material to the Group
(2)
Publication of unaudited financial information
101 (historical TSR performance)
(3)
Details of long-term incentive schemes
99 to 100
(4)
Waiver of emoluments by a director
Not applicable
(5)
Waiver of future emoluments by a director
Not applicable
(6)
Non pre-emptive issues of equity for cash
Not applicable
(7)
Non pre-emptive issue by a major subsidiary undertaking
Not applicable
(8)
Parent participation in a placing by a listed subsidiary
Not applicable
(9)
Contracts of significance
Not applicable
(10)
Provision of services by a controlling shareholder
Not applicable
(11)
Shareholder waiver of dividends
112
(12)
Shareholder waiver of future dividends
112
(13)
Agreements with controlling shareholders
Not applicable
Financial instruments
The information required under Schedule 7 of the Large and
Medium-sized Companies and Groups (Accounts and Reports)
Regulations 2008 in respect of financial instruments is given
in note 23 to the financial statements on pages 173 to 181.
Branches outside the UK
The Company does not have any branches outside the UK.
Events after the reporting period
None. Please see Note 33 on page 189.
Business relationships
Having positive relationships with our OEM partners, our main
suppliers, and our customers is imperative for the long-term
success of the Company. Our OEM relationships are key to every
part of our value chain and the length of these relationships,
which are given on page 12, is testament to this strength.
We provide access to automotive ownership and support services
throughout the customer journey and aim to deliver the best
experiences for customers in our industry globally. The
Board and management engage with customers through:
• receiving daily reporting of customer feedback on
www.reputation.com;
• analysing sales force customer journey management platform;
and
• ongoing surveys at Market level.
These help impact the principal decisions taken by the Company,
as seen on pages 72 to 76.
Political donations
The Company did not make any political donations in 2024 and
does not intend to make any political donations in 2025.
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Colleagues and colleague involvement
The Company is committed to a policy of treating all its
colleagues and job applicants equally. We are committed to
the employment of people with disabilities and will interview
those candidates who meet the minimum selection criteria.
We provide training and career development for our
colleagues, tailored where appropriate to their specific
needs, to ensure they achieve their potential. If an individual
becomes disabled while in our employment, we will do our
best to ensure continued development in their role, including
consulting them about their requirements, making
appropriate adjustments, and providing suitable alternative
positions if required.
Successfully delivering the Accelerate+ strategy requires us
to evolve both what we do and how we do things. This
includes continuing to build the winning culture we need to
help deliver on our ambitions, a culture that is built through
effective teamwork, fresh thinking, a focus on delivery, and
putting our customers at the centre of everything we do.
In support of this, our performance framework, called One
Inchcape Values & Behaviours, sets out the values and
behaviours we all need to live by at Inchcape. The
Company also has various colleague policies in place
covering a wide range of issues, such as family friendly
policies, employment rights, and equal opportunities. Policies
are implemented at a local level and comply with any
relevant legislation in that Market. All policies are available
on the Group’s intranet and compliance is monitored at
local level.
The Group’s bonus and long-term incentive schemes are
designed to encourage involvement in the Company’s
performance. UK colleagues are eligible to join the SAYE
scheme, which is offered annually. Further details can be
found in the Directors’ Report on Remuneration on pages 91
to 106.
Further information on colleague interests and principle
decisions made by the Board are given throughout this
Annual Report and Accounts and in the standalone
Sustainability Report available at www.inchcape.com.
Colleague communication
Town hall meetings are held in each Region on a regular
basis and also following the release of any financial updates
by the Company. These meetings provide colleagues with
information on the Group’s performance and an opportunity
for consulting colleagues on new initiatives or other matters
that concern them. The Group’s global intranet also provides
a means of communicating important issues to colleagues.
The colleague experience survey is the primary tool for
obtaining the views of colleagues and the results of the
survey are reported to the Board on an annual basis.
Following Alex Jensen serving three years as the designated
Non-Executive Director (DNED) for colleague engagement,
in December 2024, Nayantara Bali was appointed as the
DNED for the next three years to communicate the views of
colleagues to the Board and reports findings to the Board at
each meeting.
Colleague consultations enables the Board to gain an
understanding of how the colleague experience is
perceived and what actions can be taken to enhance this
experience so colleagues feel challenged, excited,
engaged, and supported in their roles. Further details can be
found in the Sustainability Committee Report on pages 89
to 90.
Going concern
Having assessed the principal risks and the other matters
discussed in connection with the viability statement on
pages 60 to 61, the Directors consider it appropriate to
adopt the going concern basis of accounting in the financial
statements for the next 12 months.
Auditor and disclosure of information to the auditor
The auditor, Deloitte LLP, has indicated its willingness to
continue in office. A resolution to reappoint Deloitte as
auditor will be proposed at the AGM. As far as the Directors
are aware there is no relevant audit information of which the
Company’s auditor is unaware. The Directors have taken all
the steps that they ought to have taken as Directors in order
to make themselves aware of any relevant audit information
and to establish that the Company’s auditor is aware of that
information. This confirmation is given and should be
interpreted in accordance with the provisions of section 418
of the Companies Act 2006.
Annual General Meeting
The AGM will be held at 11.00 a.m. on Thursday 15 May 2025
at the Royal Automobile Club, 89 Pall Mall, London SW1Y 5HS.
The notice convening the meeting and the resolutions to be
put to the meeting, together with the explanatory notes, are
given in the Circular to all shareholders.
The Directors’ Report was approved by the Board and has
been signed by the Group Company Secretary of
the Company.
Tamsin Waterhouse
Group Company Secretary
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Directors’ responsibilities
The Directors are responsible for preparing the Annual Report
and the financial statements in accordance with applicable
law and regulation.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law, the
Group financial statements have been properly prepared in
accordance with UK adopted international accounting
standards and IFRS Accounting Standards as issued by the
International Accounting Standards Board (IASB) and parent
company financial statements in accordance with UK
Generally Accepted Accounting Practice (UK Accounting
Standards, comprising FRS 101 ‘Reduced Disclosure
Framework’, and applicable law).
Under company law, the Directors must not approve the
financial statements unless they are satisfied that they give a
true and fair view of the state of affairs of the Group and
parent company and of the profit or loss of the Group and
parent company for that period. In preparing the financial
statements, the Directors are required to:
• select suitable accounting policies and then apply
them consistently;
• state whether applicable UK Accounting Standards have
been followed, subject to any material departures
disclosed and explained in the financial statements; and
• make judgements and accounting estimates that are
reasonable and prudent; and prepare the financial
statements on the going concern basis unless it is
inappropriate to presume that the Group and parent
company will continue in business.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the Group and parent company’s transactions. The Directors
are also responsible for disclosing with reasonable accuracy
at any time the financial position of the Group and parent
company, and enabling them to ensure that the financial
statements and the Directors’ Report on Remuneration
comply with the Companies Act 2006. The Directors are also
responsible for safeguarding the assets of the Group and
parent company and hence for taking reasonable steps for
the prevention and detection of fraud and other
irregularities. The Directors are responsible for the
maintenance and integrity of the parent company’s
website. Legislation in the UK governing the preparation and
dissemination of financial statements may differ from
legislation in other jurisdictions.
The Directors consider that the Annual Report, taken as a
whole, is fair, balanced, and understandable and provides
the information necessary for shareholders to assess the
Group and parent company’s performance, business model
and strategy. Each of the Directors, whose names and
functions are listed in the Board of Directors, confirm that, to
the best of their knowledge:
• the parent company financial statements, which have
been prepared in accordance with UK Accepted
Accounting Practice (UK Accounting Standards,
comprising FRS 101 ‘Reduced Disclosure Framework’, and
applicable law), give a true and fair view of the assets,
liabilities, financial position, and loss of the Company;
• the Group financial statements, which have been properly
prepared in accordance with UK adopted international
accounting standards and IFRS Accounting Standards as
issued by the IASB, give a true and fair view of the assets,
liabilities, financial position, and profit of the Group; and
• the Directors’ Report includes a fair review of the
development and performance of the business and the
position of the Group and parent company, together with
a description of the principal risks and uncertainties that
it faces.
The Directors considered the key messages contained in the
Strategic Report along with the disclosures made throughout
to ensure that they are consistent, transparent and a true
reflection of the business. The Directors also reviewed
supporting documentation which addresses specific
statements made in the report and the evidence to support
those statements. Following this review, the Directors consider,
when taken as a whole, that the Annual Report is fair,
balanced, and understandable and provides the information
necessary for shareholders to assess the Company’s position
and performance, business model and strategy.
By order of the Board
Duncan Tait
Adrian Lewis
Group Chief Executive
Group Chief Financial Officer
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Report on the audit of the financial statements
1. Opinion
In our opinion:
• the financial statements of Inchcape plc (the ‘Parent Company’) and its subsidiaries (the
‘Group’) give a true and fair view of the state of the Group’s and of the Parent Company’s
affairs as at 31 December 2024 and of the Group’s profit for the year then ended;
• the Group financial statements have been properly prepared in accordance with United
Kingdom adopted international accounting standards;
• the Parent Company financial statements have been properly prepared in accordance
with United Kingdom Generally Accepted Accounting Practice, including Financial Reporting
Standard 101 “Reduced Disclosure Framework”; and
• the financial statements have been prepared in accordance with the requirements of the
Companies Act 2006.
We have audited the financial statements which comprise:
• the consolidated income statement;
• the consolidated statement of comprehensive income;
• the consolidated and Parent Company statements of financial position;
• the consolidated and Parent Company statements of changes in equity;
• the consolidated statement of cash flows;
• the accounting policies; and
• the related Notes 1 to 33 to the consolidated financial statements and the related notes 1 to
12 to the Parent Company financial statements.
The financial reporting framework that has been applied in the preparation of the Group
financial statements is applicable law and United Kingdom adopted international accounting
standards. The financial reporting framework that has been applied in the preparation of the
Parent Company financial statements is applicable law and United Kingdom Accounting
Standards, including FRS 101 “Reduced Disclosure Framework” (United Kingdom Generally
Accepted Accounting Practice).
2. Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK))
and applicable law. Our responsibilities under those standards are further described in the
auditor’s responsibilities for the audit of the financial statements section of our report.
We are independent of the Group and the Parent Company in accordance with the ethical
requirements that are relevant to our audit of the financial statements in the UK, including the
Financial Reporting Council’s (the ‘FRC’s’) Ethical Standard as applied to listed public interest
entities, and we have fulfilled our other ethical responsibilities in accordance with these
requirements. The non-audit services provided to the Group and Parent Company for the year
are disclosed in Note 3 to the financial statements. We confirm that we have not provided any
non-audit services prohibited by the FRC’s Ethical Standard to the Group or the Parent
Company.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
3. Summary of our audit approach
Key audit matters
The key audit matters that we identified in the current year were:
• Revenue cut-off; and
• Disposal of the UK Retail business.
Both key audit matters were newly identified in the year.
Materiality
The materiality that we used for the Group financial statements was
£23.7m (2023: £25.0m), which was determined on the basis of profit
before tax from continuing operations adjusted for adjusting items as
defined in note 2 (“adjusted profit before tax”). This represented 5.3%
of adjusted profit before tax from continuing operations.
Scoping
Components subject to audit procedures in the current period
comprised 89% (2023: 86%) of Group revenue, 91% (2023: 87%) of
Group profit before tax from continuing operations and 82% (2023:
82%) of Group total assets.
Significant changes in
our approach
Significant changes to our approach included:
• Identification of revenue cut-off as a new key audit matter due to
the heightened risk posed by the current business and economic
environment;
• Identification of disposal of the UK Retail business as a new key
audit matter due to its material impact on the Group's financial
statements; and
• Removal of UK used vehicle inventory valuation and the
integration of the Derco Group as key audit matters. The UK Retail
business has been disposed and the integration of the Derco
Group has been finalised.
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4. Conclusions relating to going concern
In auditing the financial statements, we have concluded that the Directors’ use of the going
concern basis of accounting in the preparation of the financial statements is appropriate.
Our evaluation of the Directors’ assessment of the Group’s and Parent Company’s ability to
continue to adopt the going concern basis of accounting included:
• Understanding the Group’s process and related controls in the assessment of going concern;
• Assessing the Group’s available committed financing facilities including the nature of facilities,
repayment terms and covenants;
• Assessing the impact of short-term fluctuations in local market trading conditions, the impact of
Electric Vehicle (EV) transition, inflation and political uncertainties on the forecast cashflows;
• Evaluating the reasonableness of assumptions used in the forecasts;
• Assessing the appropriateness of the sensitivities performed by management, including
performing additional sensitivities as part of our challenge thereon;
• Performing consistency and accuracy checks over the going concern model including
checking the mathematical and clerical accuracy;
• Testing the consistency of the forecast cash flows with the forecasts prepared for the
impairment models; and
• Assessing the disclosures relating to going concern in the financial statements.
Based on the work we have performed, we have not identified any material uncertainties
relating to events or conditions that, individually or collectively, may cast significant doubt on the
Group's and Parent Company’s ability to continue as a going concern for a period of at least
twelve months from when the financial statements are authorised for issue.
In relation to the reporting on how the Group has applied the UK Corporate Governance Code,
we have nothing material to add or draw attention to in relation to the Directors’ statement in
the financial statements about whether the Directors considered it appropriate to adopt the
going concern basis of accounting.
Our responsibilities and the responsibilities of the Directors with respect to going concern are
described in the relevant sections of this report.
5. Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most
significance in our audit of the financial statements of the current period and include the most
significant assessed risks of material misstatement (whether or not due to fraud) that we
identified. These matters included those which had the greatest effect on the overall audit
strategy, the allocation of resources in the audit and directing the efforts of the
engagement team.
These matters were addressed in the context of our audit of the financial statements as a whole,
and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
5.1. Revenue cut-off
Key audit
matter
description
Class of transaction: Revenue. Refer to the Audit Committee report page
84, Revenue policy in the Accounting Policies section on page 133, Note 1
on page 142 and Note 3 on page 146.
The Group generated revenue of £9,263 million during the year
(2023: £9,382 million) from the sale of vehicles and parts, and provision of
services. The current business and economic environment and the
susceptibility to fraud in respect of achieving bonus performance targets,
particularly through fleet sales near the year end, elevates the risk of
revenue manipulation or error, particularly in the cut-off of vehicle sales. In
applying IFRS 15 Revenue from Contracts with Customers there is
judgement required in determining the timing of the transfer of control of
products and services to customers, which impacts the amount of revenue
recognised in the Group’s financial statements. The judgement could be
subject to management bias or error and so we considered the timing of
the cut-off of revenue recognition as a key audit matter, and a risk of
potential fraud in respect of revenue recognition.
The determination of whether control has passed to a customer requires
the consideration of several factors, which include consideration of the
specific delivery terms of the arrangement, length of time required to ship
to customer locations and whether certain criteria have been met to
evidence the passing of control. The circumstances where most
judgement is required are when the vehicles are yet to be despatched to
the customer (known as bill-and-hold sales).
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How the
scope of our
audit
responded to
the key audit
matter
Our procedures in response to the key audit matter included:
• Obtaining an understanding of and testing the relevant controls in place to
address the risk that revenue is recorded in an inappropriate period;
• Obtaining an understanding of the relevant shipping terms used by the
Group for the delivery of goods as well as assessing the likely length of time
required to ship to customer locations, and how this impacts the timing of
revenue recognition;
• Performing analytical procedures on revenue movements to assess whether
the revenue is in line with expectations and understanding of the business
performance;
• Performing procedures on understanding whether management has met
their bonus performance targets for revenue and whether this was met due
to increased sales towards year end by assessing the sales at year end and
comparing those to the previous months and year ends;
• For selected samples of transactions:
– Inspecting a combination of purchase orders, invoices, despatch notes,
shipping terms, delivery notes and customer agreements to assess the
appropriateness of revenue recognition timing based on the status of
vehicles at year end; and
– Specifically in the case of bill-and-hold sales assessing the extent to which
there is evidence the customer controlled the vehicle before year end
including whether there was a substantive reason for the customer
requesting the arrangement.
Key
observations
Based on our procedures we concluded that the revenue is not
materially misstated.
5.2. Disposal of the UK Retail business
Key audit
matter
description
Class of transaction: Gain from discontinued operations. Refer to the Audit
Committee report page 83 and Acquisitions and disposals note 28a on
page 186.
As detailed in Note 28a (Acquisitions and Disposals), the Group completed the
sale of the UK Retail business to Group 1 Automotive UK Limited, a wholly-
owned subsidiary of Group 1 Automotive, Inc., on 1 August 2024. The UK Retail
business has been reported in the current period as a discontinued operation
in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued
Operations. A gain on disposal of £146m has been recorded and net assets
disposed of totalled £250m, with disposal costs of £12m, as disclosed within
Note 28a (Acquisitions and Disposals).
We identified the disposal of the UK Retail business as a key audit matter in the
current year due to the size and nature of the transaction and its material
impact on the Group's financial statements including:
• The application of IFRS 5, "Non-current Assets Held for Sale and Discontinued
Operations," to this complex disposal required significant management
judgement and assumptions related to the remeasurement of the UK Retail
business’ net assets to the lower of carrying value or fair value less costs to
sell. The key assumption being on the discount rate and long-term growth
rate used in the impairment assessment;
• Identification and separation of assets, liabilities, and cash flows attributable
to the UK Retail business from those of the continuing operations, in
accordance with IFRS 5 and IFRS 8 “Operating Segments” was critical to the
measurement and presentation of the disposal. The inherent judgement
required in this process increased the risk of misstatements that could
materially impact the reported financial performance of both the
discontinued and continuing operations;
• The determination of the gain or loss on disposal, the selection of the
appropriate disposal date, the allocation of costs between continuing and
discontinued operations;
• The assessment of whether a provision is required, or if disclosure as a
contingent liability is more appropriate, is crucial for determining the
appropriate accounting treatment of potential exposures arising from the
Financial Conduct Authority’s (FCA) review into motor finance commission
arrangements. This assessment depends on the outcome of the FCA review
into motor finance commission arrangements and practices previously
employed by the Group and other automotive dealers. The FCA review,
initiated following consumer complaints, aims to determine the extent of
any misconduct and the potential need for consumer compensation;
• The disposal had significant and complex tax implications, requiring
management to make judgements regarding the recognition and
measurement of tax liabilities or benefits, as well as the related disclosures.
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How the
scope of our
audit
responded to
the key audit
matter
Our procedures in response to the key audit matter included:
• Obtaining an understanding of relevant controls, including the Group’s
controls over the application of relevant accounting principles;
• Inquiring of management about the completeness of recording the disposal
and identifying any subsequent events that may have an impact;
• Reviewing the Share Purchase Agreement (SPA) to assess the
appropriateness of the disposal date and verify the agreed-upon terms,
including any potential liabilities arising from the transaction;
• Assessing whether the UK Retail business had been deconsolidated from the
date control passed by evaluating the relevant SPA;
• Evaluating the reasonableness of key assumptions used in the Group’s pre-
disposal impairment assessment of the disposal of UK Retail business;
• Testing the accuracy of cost allocations by selecting a sample of costs and
verifying their assignment to the appropriate category (discontinued or
continuing) based on supporting documentation;
• Performing analytical review procedures on the UK Retail business's financial
results and performance leading up to the disposal date to assess for
accurate measurement of its assets and liabilities;
• Reviewing the identification, disclosure, and presentation of reportable
segments, including the impact of the UK disposal, to assess compliance
with IFRS 8 “Operating Segments” and the accurate reflection of
segment performance;
• Assessing the accuracy and completeness of the tax accounting for tax
liabilities or benefits and impacts arising from the disposal, with the
involvement of our tax specialists;
• Addressing the FCA matter by:
– Examining the terms of the indemnification associated with the Share
Purchase Agreement between the Group and buyer.
– Inquiring with external lawyers and legal counsel to understand the
matter's current status and potential implications for the transaction.
– Reviewing relevant correspondence and documentation related to the
FCA matter.
• Evaluating the relevant disclosures regarding the disposal of the UK Retail
business within Note 28a (Acquisitions and Disposals).
Key
observations
Based on our procedures we are satisfied with the results of our audit
procedures in respect of the disposal of the UK Retail business.
6. Our application of materiality
6.1. Materiality
We define materiality as the magnitude of misstatement in the financial statements that makes it
probable that the economic decisions of a reasonably knowledgeable person would be
changed or influenced. We use materiality both in planning the scope of our audit work and in
evaluating the results of our work.
Based on our professional judgement, we determined materiality for the financial statements as a
whole as follows:
Group financial statements
Parent Company financial statements
Materiality
£23.7 million (2023: £25.0 million)
£12.7 million (2023: £9.4 million)
Basis for
determining
materiality
Materiality was determined on the
basis of 5.3% (2023: 5.0%) of adjusted
profit before tax from continuing
operations.
Refer to Note 2 Adjusting Items for
further details of adjusting items and
Alternative Performance Measures
on page 192 for the management’s
reconciliation of this alternative
performance measure to the
Group’s statutory measure.
Parent Company materiality was
determined on the basis of 1.0% of net
assets (2023: 1.0% of net assets).
Rationale
for the
benchmark
applied
Adjusted profit before tax from
continuing operations, a key metric
communicated by management in
the Group's results announcements,
provides users of the financial
statements with a more
comparable measure of the Group's
underlying performance as it
excludes the impact of potentially
distortive adjusting items, such as
the acquisition and disposal cost.
We therefore consider adjusted
profit before tax an appropriate
benchmark for determining
materiality.
As the Parent Company is non-
trading, operates primarily as a
holding company for the Group’s
trading entities, and is not profit
orientated, we consider the net asset
position to be the most appropriate
benchmark to use.
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6.2. Performance materiality
We set performance materiality at a level lower than materiality to reduce the probability that, in
aggregate, uncorrected and undetected misstatements exceed the materiality for the financial
statements as a whole.
Group financial statements
Parent Company financial statements
Performance
materiality
65% (2023: 65%) of Group materiality
70% (2023: 70%) of Parent Company
materiality
Basis for
determining
materiality
In determining performance
materiality, we considered the
following factors:
• our cumulative experience from
prior year audits, and
management’s willingness to
correct misstatements identified;
• our risk assessment, including our
understanding of the entity and its
environment;
• our risk assessment on the inherent
complexities and financial impact
of disposal of UK Retail business; and
• our assessment of the Group’s
control environment and whether
we were able to reply on controls.
In determining performance
materiality, we considered the
following factors:
• our cumulative experience from
prior year audits, and
management’s willingness to
correct misstatements identified;
• our risk assessment, including our
understanding of the entity and its
environment; and
• our assessment of the Parent
Company’s control environment.
6.3. Error reporting threshold
We agreed with the Audit Committee that we would report to the Committee all audit
differences in excess of £1.2m (2023: £1.3 million), as well as differences below that threshold that,
in our view, warranted reporting on qualitative grounds. We also report to the Audit Committee
on disclosure matters that we identified when assessing the overall presentation of the
financial statements.
7. An overview of the scope of our audit
7.1. Identification and scoping of components
In line with ISA (UK) 600 (Revised), we have adopted a risk-based approach to the audit of the
Group financial statements. This revised standard emphasises the development of a tailored
audit plan for each significant account, shifting from the previous approach focus on individually
significant components.
In selecting the components which are in scope for audit procedures to be performed as part of
the Group audit, we considered:
• the inherent risk in each of the markets that the Group operates;
• the Group’s control environment;
• the significance of identified risks in each of the components;
• the component’s contribution to the Group’s revenue, profit and total assets;
• the specific qualitative factors, including external risks, management identified risks, and
those identified through statistical analysis;
• the nature of any acquisitions and disposals within the year; and
• the importance of introducing variability and unpredictability into our audit scoping.
The components which were subject to audit procedures were in:
• Australia
• Barbados
• Belgium
• Bolivia
• Bulgaria
• Chile
• Colombia
• Costa Rica
• Ethiopia
• Greece
• Guam
• Hong Kong
• Indonesia
• Panama
• Peru
• Philippines
• Poland
• Romania
• Singapore
In addition to the work performed at a component level, the Group audit team performed audit
procedures on the Parent Company and consolidated financial statements relating to corporate
activities such as the Group’s treasury operations, pension obligations, impairment reviews of
goodwill and indefinite-life intangible assets, the disposal of UK Retail business, litigation provisions,
the Group consolidation, the going concern assessment and financial statement disclosures. The
Group audit team also performed residual balance analysis, evaluating the coverage achieved
across significant accounts and key metrics and considering its proportion to Group materiality to
ensure the risk of material misstatement in the residual population is remote.
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The range of component performance materialities applied was £6m to £12.7m
(2023: £7m to £10m). The components which were scoped in for procedures on audit of
entire financial information, audit procedures on one or more classes of transactions, account
balance or disclosures, or specified procedures together represent 89% (2023: 86%) of
revenue from continuing operations, 91% (2023: %87) of profit before tax and 82% (2023: 82%)
of total assets.
74%
15%
11%
Audit of the entire
financial information
Subject to audit procedures
Review at group level
89%
6% 5%
75%
6%
5%
7.2. Our consideration of the control environment
We have considered the control environment of the Group, which is also discussed within the
Audit Committee Report on page 81, and encompasses controls relating to the financial
reporting process, preparation of consolidated Group accounts, operational and compliance
controls and risk management processes.
We have also tested the General Information Technology Controls (GITC) in place designed to
address the IT risks relating to the Group and how these relate to the entity’s financial reporting
processes. Management have continued to consolidate and centralise key IT systems and
support functions across the Group. We have reflected this in our centralised testing approach of
IT controls where practicable.
For all components we obtained an understanding of the relevant controls for in scope
balances. This included understanding the impact of in-year system migrations, where
applicable, and testing data transfer processes. Where components determined that reliance on
controls was appropriate, procedures were designed and performed to evaluate the operating
effectiveness of those controls at the component level.
Our consideration of climate-related risks
The Group is exposed to the impacts of climate change on its business and operations as
highlighted in the Task Force on Climate-Related Financial Disclosures (TCFD) report on page 35,
viability statement on page 60, the principal risks on page 52, and in Accounting Policies (Key
Sources of Estimation Uncertainty) on page 140. Management has concluded there to be no
material impact arising from climate change on the judgements and estimates made in the
financial statements on page 133.
We have obtained management’s climate-related risk assessment and held discussions with
management to understand the process of identifying and quantifying climate-related risks, the
determination of mitigating actions and the impact on the Group’s financial statements. We
have engaged our climate specialists in our assessment to consider broader industry and market-
wide practice.We completed an independent climate- based risk assessment to consider the
potential impact of climate change on the Group’s financial statements, incorporating both
business specific knowledge and wider industry awareness, including the extent to which climate
change considerations have been included in the Group’s forecast financial information. We
used this"to assess the completeness of the Group’s identified risks and to develop audit
procedures to respond to these risks as part of our work in relation to impairment and long-term
viability, as well as considering climate- related risks throughout our risk assessments on each
financial statement account balance.
In considering the disclosures presented as part of the Strategic Report, we engaged our climate
specialists to review the TCFD disclosures in the financial statements and recommendations
made by both the Task Force and FRC as set out in their thematic reviews. We have also
assessed whether these disclosures reflect our understanding of the Group’s approach
to climate.
7.3. Working with other auditors
We engaged component auditors to perform procedures at the components under our
direction and supervision. We issued detailed instructions to the component auditors and held
planning meetings, interim update meetings and year end close meetings with each
component team.
We have continued our component visits on a risk focused and rotational basis to oversee the
work performed by our component auditors. The component audit teams visited in their location
in the current period were: Chile, Peru, Barbados, Singapore, Indonesia, Australia, Greece,
Bulgaria and Belgium.
In conjunction with the on-site visits, frequent calls were held between the Group and
component teams throughout the year and remote access to relevant documents was
provided. Senior members of the Group audit team were focused on overseeing the role of the
component audit teams, so that a consistent audit approach is applied to the operations in the
Group’s businesses.
Prior to the commencement of our detailed audit work we held virtual or physical planning
meetings with our component teams on a regional basis, led by the Group audit team. The
purpose of these planning meetings was to ensure a good level of understanding of the Group’s
businesses, its core strategy and a discussion of the significant risks and workshops on our planned
audit approach.
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Revenue
Profit before
tax
Total assets
The component visits and other communications by the Group audit team were timed to enable
us to be involved during the planning and risk assessment process in addition to the execution of
detailed audit procedures. During our visits we attended key meetings with component
management and auditors, reviewed and challenged component auditor working papers in the
underlying audit files and component reporting. In addition, we attended component audit
closing calls and other key meetings with management throughout the 2024 audit process.
As the Group has diversified geographically, the Group audit team has enhanced the activities
performed to direct and supervise component audit teams by:
• identifying components of greater risk and increasing the seniority of the audit team and
oversight at the component level including having dedicated Spanish-speaking senior team
members performing oversight of the Americas segment;
• holding sessions to refresh component audit teams on key areas of focus and extended
component visits by the Group audit team; and
• providing additional guidance, provided to all component audit teams, to identify areas of
judgement and improve the quality and consistency of the audit procedures performed.
8. Other information
The other information comprises the information included in the annual report, other than the
financial statements and our auditor’s report thereon. The Directors are responsible for the other
information contained within the annual report.
Our opinion on the financial statements does not cover the other information and, except to the
extent otherwise explicitly stated in our report, we do not express any form of assurance
conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other
information is materially inconsistent with the financial statements or our knowledge obtained in
the course of the audit, or otherwise appears to be materially misstated.
If we identify such material inconsistencies or apparent material misstatements, we are required
to determine whether this gives rise to a material misstatement in the financial statements
themselves. If, based on the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report that fact."
We have nothing to report in this regard.
9. Responsibilities of Directors
As explained more fully in the Directors’ responsibilities statement, the Directors are responsible for
the preparation of the financial statements and for being satisfied that they give a true and fair
view, and for such internal control as the Directors determine is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the financial statements, the Directors are responsible for assessing the Group’s and
the Parent Company’s ability to continue as a going concern, disclosing as applicable, matters
related to going concern and using the going concern basis of accounting unless the Directors
either intend to liquidate the Group or the Parent Company or to cease operations, or have no
realistic alternative but to do so.
10. Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an
auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but
is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on
the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our
auditor’s report.
11. Extent to which the audit was considered capable of detecting irregularities,
including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We
design procedures in line with our responsibilities, outlined above, to detect material
misstatements in respect of irregularities, including fraud. The extent to which our procedures are
capable of detecting irregularities, including fraud is detailed below.
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11.1. Identifying and assessing potential risks related to irregularities
In identifying and assessing risks of material misstatement in respect of irregularities, including
fraud and non- compliance with laws and regulations, we considered the following:
• the nature of the industry and sector, control environment and business performance including
the design of the Group’s remuneration policies, key drivers for Directors’ remuneration, bonus
levels and performance targets;
• the results of our enquiries of management, internal audit, in house legal counsel, the Directors
and the Audit Committee about their own identification and assessment of the risks of
irregularities, including those that are specific to the Group’s sector;
• any matters we identified having obtained and reviewed the Group’s documentation of
their policies and procedures relating to:
– identifying, evaluating and complying with laws and regulations and whether they
were aware of any instances of non-compliance and including those subject to the
FCA investigation;
– detecting and responding to the risks of fraud and whether they have knowledge of any
actual, suspected or alleged fraud;
– the internal controls established to mitigate risks of fraud or non-compliance with laws and
regulations; and
• the matters discussed among the audit engagement team including component audit teams
and relevant internal specialists, including tax, IT, pension, climate and valuation specialists
regarding how and where fraud might occur in the financial statements and any potential
indicators of fraud.
As a result of these procedures, we considered the opportunities and incentives that may exist
within the organisation for fraud and identified the greatest potential for fraud in the following
area: revenue cut-off. In common with all audits under ISAs (UK), we are also required to perform
specific procedures to respond to the risk of management override.
We also obtained an understanding of the legal and regulatory frameworks that the Group
operates in, focusing on provisions of those laws and regulations that had a direct effect on the
determination of material amounts and disclosures in the financial statements. The key laws and
regulations we considered in this context included the UK Companies Act, Listing Rules, pensions
legislation, environmental and vehicle legislation and tax legislation.
In addition, we considered provisions of other laws and regulations that do not have a direct
effect on the financial statements but compliance with which may be fundamental to the
Group’s ability to operate or to avoid a material penalty.
11.2. Audit response to risks identified
As a result of performing the above, we identified revenue cut-off as a key audit matter related
to the potential risk of fraud. The key audit matters section of our report explains the matter in
more detail and also describes the specific procedures we performed in response to that key
audit matter.
In addition to the above, our procedures to respond to risks identified included the following:
• reviewing the financial statement disclosures and testing to supporting documentation to
assess compliance with provisions of relevant laws and regulations described as having a
direct effect on the financial statements;
• enquiring of management, the Audit Committee and in-house legal counsel concerning
actual and potential litigation and claims;
• performing analytical procedures to identify any unusual or unexpected relationships that
may indicate risks of material misstatement due to fraud;
• reading minutes of meetings of those charged with governance, reviewing internal audit
reports and reviewing correspondence with tax authorities; and
• in addressing the risk of fraud through management override of controls, testing the
appropriateness of journal entries and other adjustments; assessing whether the judgements
made in making accounting estimates are indicative of a potential bias; and evaluating the
business rationale of any significant transactions that are unusual or outside the normal
course of business.
We also communicated relevant identified laws and regulations and potential fraud risks to all
engagement team members including internal specialists and component audit teams and
remained alert to any indications of fraud or non-compliance with laws and regulations
throughout the audit."
Report on other legal and regulatory requirements
12. Opinions on other matters prescribed by the Companies Act 2006
In our opinion the part of the Directors’ remuneration report to be audited has been properly
prepared in accordance with the Companies Act 2006.
In our opinion, based on the work undertaken in the course of the audit:
• the information given in the strategic report and the Directors’ report for the financial year
for which the financial statements are prepared is consistent with the financial statements;
and
• the strategic report and the Directors’ report have been prepared in accordance with
applicable legal requirements.
In the light of the knowledge and understanding of the Group and the Parent Company and
their environment obtained in the course of the audit, we have not identified any material
misstatements in the strategic report or the Directors’ report.
Inchcape Annual Report and Accounts 2024
Strategic report
Governance
Financial statements
INDEPENDENT AUDITOR’S REPORT CONTINUED
to the members of Inchcape Plc
Inchcape.com
123
13. Corporate Governance Statement
The Listing Rules require us to review the Directors' statement in relation to going concern,
longer-term viability and that part of the Corporate Governance Statement relating to the
group’s compliance with the provisions of the UK Corporate Governance Code specified for
our review.
Based on the work undertaken as part of our audit, we have concluded that each of the
following elements of the Corporate Governance Statement is materially consistent with the
financial statements and our knowledge obtained during the audit:
• the Directors’ statement with regards to the appropriateness of adopting the going concern
basis of accounting and any material uncertainties identified set out on page 114;
• the Directors’ explanation as to its assessment of the group’s prospects, the period this
assessment covers and why the period is appropriate set out on page 60;
• the Directors' statement on fair, balanced and understandable set out on page 115;
• the Board’s confirmation that it has carried out a robust assessment of the emerging and
principal risks set out on page 52;
• the section of the annual report that describes the review of effectiveness of risk
management and internal control systems set out on page 85; and
• the section describing the work of the Audit Committee set out on page 81.
14. Matters on which we are required to report by exception
14.1. Adequacy of explanations received and accounting records
Under the Companies Act 2006 we are required to report to you if, in our opinion:
• we have not received all the information and explanations we require for our audit; or
• adequate accounting records have not been kept by the Parent Company, or returns
adequate for our audit have not been received from branches not visited by us; or
• the Parent Company financial statements are not in agreement with the accounting records
and returns.
We have nothing to report in respect of these matters.
14.2. Directors’ remuneration
Under the Companies Act 2006 we are also required to report if in our opinion certain
disclosures of Directors’ remuneration have not been made or the part of the Directors’
remuneration report to be audited is not in agreement with the accounting records
and returns.
We have nothing to report in respect of these matters.
15. Other matters which we are required to address
15.1. Auditor tenure
Following the recommendation of the Audit Committee, we were appointed by members on
25 May 2018 to audit the financial statements for the year ending 31 December 2018 and
subsequent financial periods. The period of total uninterrupted engagement including previous
renewals and reappointments of the firm is seven years, covering the years ending 31
December 2018 to 31 December 2024.
15.2. Consistency of the audit report with the additional report to the Audit Committee
Our audit opinion is consistent with the additional report to the Audit Committee we are
required to provide in accordance with ISAs (UK).
16. Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter
3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might
state to the Company’s members those matters we are required to state to them in an
auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than the Company and the Company’s
members as a body, for our audit work, for this report, or for the opinions we have formed.
As required by the Financial Conduct Authority (FCA) Disclosure Guidance and Transparency
Rule (DTR) 4.1.15R – DTR 4.1.18R, these financial statements will form part of the Electronic
Format Annual Financial Report filed on the National Storage Mechanism of the FCA in
accordance with DTR 4.1.15R – DTR 4.1.18R. This auditor’s report provides no assurance over
whether the Electronic Format Annual Financial Report has been prepared in compliance with
DTR 4.1.15R – DTR 4.1.18R.
David Griffin FCA (Senior statutory auditor)
For and on behalf of Deloitte LLP
Statutory Auditor
London, UK
3 March 2025
Inchcape Annual Report and Accounts 2024
Strategic report
Governance
Financial statements
INDEPENDENT AUDITOR’S REPORT CONTINUED
to the members of Inchcape Plc
Inchcape.com
124
Revenue
1, 3
9,263
9,382
Cost of sales
(7,657)
(7,722)
Gross profit
1,606
1,660
Net operating expenses
3
(1,044)
(1,090)
Operating profit
562
570
Share of profit after tax of joint ventures and
associates
13
2
1
Profit before finance and tax
564
571
Finance income
6
71
51
Finance costs
6
(221)
(244)
Profit before tax from continuing operations
414
378
Tax
7
(129)
(130)
Profit for the year from continuing operations
285
248
Profit from discontinued operations
28c
150
35
Total profit for the year
435
283
Profit attributable to:
– Owners of the parent
421
270
– Non-controlling interests
14
13
435
283
Earnings per share from continuing operations
attributable to the owners of the parent
Basic earnings per share (pence)
8
66.4p
57.1p
Diluted earnings per share (pence)
8
65.6p
56.4p
Earnings per share attributable to the owners
of the parent
Basic earnings per share (pence)
8
103.1p
65.6p
Diluted earnings per share (pence)
8
101.9p
64.8p
Continuing operations
Notes
2024
£m
2023
£m
Alternative performance measures
Operating profit from continuing operations
562
570
Adjusting items within net operating
expenses:
2
22
50
Acquisition and integration costs
42
50
Disposal of businesses
(6)
—
Derecognition of intangibles
10
5
—
Impairment reversals
10
(19)
—
Adjusted operating profit from continuing
operations
584
620
Share of profit after tax of joint ventures and
associates
2
1
Adjusted profit before finance and tax from
continuing operations
586
621
Net finance costs
(150)
(193)
Adjusting items within net finance costs:
2
8
39
Net monetary loss on hyperinflation
8
29
Interest on deferred dividend payment
—
10
Adjusted profit before tax from continuing
operations
444
467
Tax on adjusted profit
(139)
(140)
Adjusted profit after tax from continuing
operations
305
327
Adjusted earnings per share from continuing
operations
8
Basic adjusted earnings per share
71.3p
76.3p
Diluted adjusted earnings per share
70.4p
75.3p
Continuing operations
Notes
2024
£m
2023
£m
The notes on pages 131 to 189 are an integral part of these consolidated financial statements
Inchcape Annual Report and Accounts 2024
Strategic report
Governance
Financial statements
CONSOLIDATED INCOME STATEMENT
For the year ended 31 December 2024
Inchcape.com
125
Profit for the year
435
283
Other comprehensive income/(expense):
Items that will not be reclassified to the
consolidated income statement
Retirement benefit schemes
– net actuarial losses
5
(46)
(20)
– deferred tax on actuarial losses
16
(1)
(1)
(47)
(21)
Items that may be or have been reclassified
subsequently to the consolidated
income statement
Cash flow hedges
– net fair value gains/(losses)
25
22
(48)
– tax on cash flow hedges1
16
(14)
17
Investments held at fair value
– net fair value gains/(losses)
14
3
(3)
Deferred tax on taxation losses
16
—
—
Foreign currency translation
Exchange differences on translation of
foreign operations
25
(245)
(133)
Recycling of foreign currency reserve
25
(4)
(1)
Adjustments for hyperinflation (including tax)
25
(4)
36
(242)
(132)
Other comprehensive expense for the year
(289)
(153)
Total comprehensive income for the year
146
130
Notes
2024
£m
2023
£m
Total comprehensive income for the year
attributable to:
– Owners of the parent
133
120
– Non-controlling interests
13
10
146
130
Total comprehensive income attributable to
owners of Inchcape plc arising from:
– Continuing operations
(17)
85
– Discontinued operations
150
35
Notes
2024
£m
2023
£m
1. Taxation in other comprehensive income in respect of cash flow hedges is comprised of a deferred tax
charge of £13m (2023: credit of £18m) and a current tax charge of £1m (2023: charge of £1m).
The notes on pages 131 to 189 are an integral part of these consolidated financial statements.
Inchcape Annual Report and Accounts 2024
Strategic report
Governance
Financial statements
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2024
Inchcape.com
126
Non-current assets
Intangible assets
10
1,156
1,271
Property, plant and equipment
11
589
893
Right-of-use assets
12
271
364
Investments in joint ventures and associates
13
21
21
Financial assets at fair value through other
comprehensive income
14
4
1
Derivative financial instruments
23
—
1
Trade and other receivables
15
34
49
Deferred tax assets
16
91
105
Retirement benefit asset
5
36
84
2,202
2,789
Current assets
Inventories
17
1,935
2,718
Trade and other receivables
15
829
835
Derivative financial instruments
23
48
38
Current tax assets
55
56
Cash at bank and short term deposits
549
689
Assets held for sale
19
20
14
3,436
4,350
Total assets
5,638
7,139
Current liabilities
Trade and other payables
20
(2,565)
(3,150)
Derivative financial instruments
23
(47)
(88)
Current tax liabilities
(70)
(81)
Provisions
21
(50)
(69)
Lease liabilities
12
(66)
(81)
Borrowings
22
(195)
(652)
(2,993)
(4,121)
Notes
2024
£m
2023
£m
Non-current liabilities
Trade and other payables
20
(106)
(69)
Provisions
21
(26)
(39)
Derivative financial instruments
23
—
(9)
Deferred tax liabilities
16
(246)
(267)
Lease liabilities
12
(236)
(359)
Borrowings
22
(544)
(638)
Retirement benefit liability
5
(13)
(17)
(1,171)
(1,398)
Total liabilities
(4,164)
(5,519)
Net assets
1,474
1,620
Equity
Share capital
24
40
42
Share premium
147
147
Capital redemption reserve
145
143
Merger reserve
25
312
312
Other reserves
25
(285)
(63)
Retained earnings
26
1,020
940
Equity attributable to owners of the parent
1,379
1,521
Non-controlling interests
95
99
Total equity
1,474
1,620
Notes
2024
£m
2023
£m
The notes on pages 131 to 189 are an integral part of these consolidated financial statements.
The consolidated financial statements on pages 125 to 130 were approved by the Board of
Directors on 3 March 2025 and were signed on its behalf by:
Duncan Tait
Group Chief Executive
Adrian Lewis
Group Chief Financial Officer
Inchcape Annual Report and Accounts 2024
Strategic report
Governance
Financial statements
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December 2024
Inchcape.com
127
Notes
Share
capital
£m
Share
premium
£m
Capital
redemption
reserve
£m
Merger
reserve
£m
Other
reserves
£m
Retained
earnings
£m
Equity
attributable
to owners
of the
parent
£m
Non-controlling
interests
£m
Total
shareholders’
equity
£m
At 1 January 2023
38
147
143
316
69
820
1,533
34
1,567
Profit for the year
—
—
—
—
—
270
270
13
283
Other comprehensive expense for
the year
—
—
—
—
(130)
(20)
(150)
(3)
(153)
Total comprehensive income/
(expense) for the year
—
—
—
—
(130)
250
120
10
130
Hedging gains and (losses)
transferred to inventory
—
—
—
—
(2)
—
(2)
—
(2)
Written put option
—
—
—
—
—
(1)
(1)
—
(1)
Shares issued
4
—
—
(4)
—
—
—
—
—
Acquisition of non-controlling
interests
—
—
—
—
—
3
3
(3)
—
Non-controlling interests on
acquisition of subsidiaries
—
—
—
—
—
—
—
64
64
Share-based payments, net of tax
4, 16
—
—
—
—
—
15
15
—
15
Purchase of own shares by the
Inchcape Employee Trust
24
—
—
—
—
—
(19)
(19)
—
(19)
Dividends:
– Owners of the parent
9
—
—
—
—
—
(128)
(128)
—
(128)
– Non-controlling interests
—
—
—
—
—
—
—
(6)
(6)
At 31 December 2023
42
147
143
312
(63)
940
1,521
99
1,620
Inchcape Annual Report and Accounts 2024
Strategic report
Governance
Financial statements
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2024
Inchcape.com
128
Notes
Share
capital
£m
Share
premium
£m
Capital redemption
reserve
£m
Merger
reserve
£m
Other
reserves
£m
Retained
earnings
£m
Total equity
attributable to
owners of
the parent
£m
Non-
controlling interests
£m
Total shareholders’
equity
£m
At 1 January 2024
42
147
143
312
(63)
940
1,521
99
1,620
Profit for the year
—
—
—
—
—
421
421
14
435
Other comprehensive expense for
the year
—
—
—
—
(241)
(47)
(288)
(1)
(289)
Total comprehensive income/
(expense) for the year
—
—
—
—
(241)
374
133
13
146
Hedging gains and (losses)
transferred to inventory
—
—
—
—
19
—
19
—
19
Share buyback programme
(2)
—
2
—
—
(151)
(151)
—
(151)
Share-based payments,
net of tax
4, 16
—
—
—
—
—
18
18
—
18
Purchase of own shares by the
Inchcape Employee Trust
24
—
—
—
—
—
(14)
(14)
—
(14)
Dividends:
– Owners of the parent
9
—
—
—
—
—
(147)
(147)
—
(147)
– Non-controlling interests
—
—
—
—
—
—
—
(17)
(17)
At 31 December 2024
40
147
145
312
(285)
1,020
1,379
95
1,474
The notes on pages 131 to 189 are an integral part of these consolidated financial statements. Share-based payments include a net tax credit of £nil (2023: net tax credit of £nil).
Inchcape Annual Report and Accounts 2024
Strategic report
Governance
Financial statements
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY CONTINUED
For the year ended 31 December 2024
Inchcape.com
129
Cash generated from operating activities
Cash generated from operations
27a
873
900
Tax paid
(134)
(156)
Interest received
62
46
Interest paid
(215)
(197)
Net cash generated from operating activities
586
593
Cash flows from investing activities
Acquisition of businesses, net of cash and
overdrafts acquired
28b
5
(137)
Net cash inflow from sale of businesses
28a
391
1
Proceeds from disposal of investments in joint
ventures and associates
—
2
Purchase of investments in joint ventures and
associates
—
(3)
Purchase of property, plant and equipment
(76)
(88)
Purchase of intangible assets
(3)
(5)
Proceeds from disposal of property, plant
and equipment
9
31
Dividends received from joint ventures and
associates
1
1
Receipt from finance sub-lease receivables
2
3
Lease payments prior to commencement
date
(1)
—
Net cash generated from/(used in) investing
activities
328
(195)
Notes
2024
£m
2023
£m
Cash flows from financing activities
Share buyback programme
24a
(147)
—
Purchase of own shares by the Inchcape
Employee Trust
(14)
(19)
Repayment of acquisition financing term
loan and bridge facilities
22
(250)
(350)
Repayment of Private Placement loan notes
22
(70)
—
Cash (outflow)/inflow from revolving credit
facility
(95)
150
Cash inflow from bond issuance
—
348
Net cash outflow from other borrowings
(69)
(560)
Payments to former shareholders of Derco
group
—
(267)
Payment of capital element of lease
liabilities
(81)
(87)
Equity dividends paid
9
(147)
(128)
Acquisition of non-controlling interests
—
(15)
Dividends paid to non-controlling interests
(17)
(6)
Net cash used in financing activities
(890)
(934)
Net increase/(decrease) in cash and cash
equivalents
27b
24
(536)
Cash and cash equivalents at beginning of
the period
440
1,050
Effect of foreign exchange rate changes
(98)
(74)
Cash and cash equivalents at end of the
period
366
440
Cash and cash equivalents consist of:
Cash at bank
18
458
610
Short-term deposits
18
91
79
Bank overdrafts
22
(183)
(249)
366
440
Notes
2024
£m
2023
£m
The notes on pages 131 to 189 are an integral part of these consolidated financial statements.
Inchcape Annual Report and Accounts 2024
Strategic report
Governance
Financial statements
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2024
Inchcape.com
130
General information
Inchcape plc is a public company limited by shares, domiciled and incorporated in the UK,
and registered in England and Wales. The address of the registered office is 22a St James’s
Square, London, SW1Y 5LP. The nature of the Group’s operations and principal activities are set
out in note 1 and on pages 2 to 61.
The Group consolidated financial statements have been prepared in accordance with UK-
adopted International Financial Reporting Standards (IFRS) and the Companies Act 2006
applicable to companies reporting under IFRS.
Accounting convention
The consolidated financial statements have been prepared under the historical cost
convention, except for financial assets at fair value through other comprehensive income, and
those financial assets and financial liabilities (including derivative instruments) held at fair value
through profit or loss, which are measured at fair value.
Going concern
Based on the Group’s cash flow forecasts and projections, the Board is satisfied that the Group
will operate within the level of its committed facilities for the foreseeable future. For this reason,
the Board continues to adopt the going concern basis in preparing its financial statements. In
making this assessment, the Group has considered available liquidity in relation to net debt and
committed facilities, the Group’s latest forecasts for 2025 and 2026 cash flows, together with
adjusted scenarios.
Committed bank facilities and Private Placement borrowings amount to £1,040m, of which
£195m was drawn at 31 December 2024. In June 2023, the Group issued a £350m bond offering
with a coupon of 6.5%, due to mature in June 2028.
The Private Placement loan notes are subject to an interest cover covenant based on an
adjusted EBITA measure to interest on consolidated borrowings measured on a trailing 12-
month basis at June and December.
The latest Group forecasts for 2025 and 2026 indicate that the Group is expected to be
compliant with this covenant throughout the forecast period and have sufficient liquidity to
continue operating throughout that period.
A range of sensitivities has been applied to the forecasts to assess the Group’s compliance with
its covenant requirements over the forecast period. These sensitivities included:
• a 12-month reduction in New and Used revenue from July 2025, resulting from decreasing
consumer demand in response to fiscal tightening and resulting economic downturns;
• a reduction in reported GBP earnings from July to December 2025 resulting from the
strengthening of the sterling relative to other currencies;
• a general liquidity reduction impacting working capital from January 2026;
• with no mitigating actions applied in relation to the sensitivities described above.
In a scenario where all of the above sensitivities occur at the same time, the Group has
modelled the possibility of the interest cover covenant being breached in 2025 and 2026. With
the interest cover covenant measured on a trailing 12-month basis, the sensitised forecasts
indicate that the Group is not expected to breach any covenants and would be compliant
with the interest cover requirements throughout the forecast period. Additionally, under these
circumstances, the Group expects to have sufficient funds to meet cash flow requirements.
A reverse stress test scenario analysis, concluded that a set of circumstances in which the
Group would breach its covenant or have insufficient funds to meet cash flow requirements
are considered to be remote, relative to the sensitivities referred to above.
Therefore, the board concluded that the Group will be able to operate within the level of its
committed facilities for the foreseeable future. The directors consider it appropriate to adopt
the going concern basis of accounting in preparing the financial statements for the year
ending 31 December 2024.
Newly adopted accounting standards
From 1 January 2024, the following standards become effective in the Group’s consolidated
financial statements:
• Amendments to IAS 1 - Non-current liabilities with covenants
• Amendments to IAS 1 - Classification of liabilities as current or non-current
• Amendments to IFRS 16 - Leases on sale and leaseback
• Amendments to IAS 7 and IFRS 7 - Supplier finance
• Amendments due to Finance (No. 2) Act 2023 for Pillar Two income inclusion (IIR)
The adoption of the standards and interpretations listed above has not led to any material
impact on the financial position or performance of the Group.
The Group has applied the amendments to IAS7 and IFRS 7 for the first time in the current year.
The amendments add a disclosure objective to IAS 7 stating that an entity is required to
disclose information about its supplier finance arrangements that enables users of financial
statements to assess the effects of those arrangements on the entity’s liabilities and cash flows.
In addition, IFRS 7 is amended to add supplier finance arrangements as an example within the
requirements to disclose information about an entity’s exposure to concentration of liquidity
risk. The Group has entered into vehicle funding arrangements to fund the purchase of vehicles
(see note 20).
The Group has not early adopted other standards, amendments to standards or interpretations
that have been issued but are not yet effective.
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Financial statements
ACCOUNTING POLICIES
Inchcape.com
131
Standards not effective at the balance sheet date
The following standards were in issue but were not yet effective at the balance sheet date.
These standards have not yet been early adopted by the Group, and will be applied for the
Group’s financial years commencing on or after 1 January 2025:
• Amendments to IAS 21 - Lack of exchangeability;
• IFRS 18 - Presentation and Disclosure in Financial Statements; and
• IFRS 19 - Subsidiaries without public accountability.
Management are currently reviewing the new standards to assess the impact that they may
have on the Group’s reported position and performance. Management do not expect that
the adoption of the standards listed above will have a material impact on the financial
statements of the Group.
Basis of consolidation
The consolidated financial statements comprise the financial statements of the parent
company (Inchcape plc) and all of its subsidiary undertakings (defined as those where the
Group has control), together with the Group’s share of the results of its joint ventures (defined
as those where the Group has joint control) and associates (defined as those where the Group
has significant influence but not control). The results of subsidiaries are consolidated and the
Group’s share of results of its joint ventures and associates is equity accounted for as of the
same reporting date as the parent company, using consistent accounting policies.
The results of newly acquired subsidiaries are consolidated using the acquisition method of
accounting from the date on which control of the net assets and operations of the acquired
company are effectively transferred to the Group. Similarly, the results of subsidiaries disposed
of cease to be consolidated from the date on which control of the net assets and operations is
transferred out of the Group.
The Group treats transactions with non-controlling interests as transactions with equity owners of
the Group. For purchases from non-controlling interests, the difference between any
consideration paid and the relevant share acquired of the carrying value of net assets of the
subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also
recorded in equity.
Investments in joint ventures and associates are accounted for using the equity method,
whereby the Group’s share of post-acquisition profits or losses is recognised in the consolidated
income statement, and its share of post-acquisition movements in shareholders’ equity is
recognised in shareholders’ equity. If the Group’s share of losses in a joint venture or associate
equals or exceeds its investment in the joint venture or associate, the Group does not recognise
further losses, unless it has contractual obligations or made payments on behalf of the joint
venture or associate.
Intercompany balances and transactions and any unrealised profits arising from intercompany
transactions are eliminated in preparing the consolidated financial statements.
Foreign currency translation
Transactions included in the results of each of the Group’s entities are measured using the
currency of the primary economic environment in which the entity operates (the functional
currency). The consolidated financial statements are presented in sterling, which is the
functional currency of the parent company, Inchcape plc, and the presentation currency of
the Group.
In the individual entities, transactions in foreign currencies are translated into the functional
currency at the rates of exchange prevailing at the dates of the individual transactions.
Monetary assets and liabilities denominated in foreign currencies are subsequently retranslated
at the rate of exchange ruling at the end of the reporting period. All differences are taken to
the consolidated income statement, except those exchange differences arising on long-term
foreign currency borrowings that form part of a net investment in a foreign investment, which
on consolidation are taken directly to other comprehensive income.
The assets and liabilities of foreign operations are translated into sterling at the rate of
exchange ruling at the end of the reporting period. The income statements and cash flows of
foreign operations are translated into sterling at the average rates of exchange for the period,
except for subsidiaries in hyperinflationary economies that are translated at the closing rate of
exchange at the end of the period. Exchange differences arising from 1 January 2004 are
recognised as a separate component of shareholders’ equity. On disposal of a foreign
operation, any cumulative exchange differences held in shareholders’ equity are transferred to
the consolidated income statement.
Presentation of comparative amounts
Comparative amounts presented in the consolidated income statement, the consolidated
statement of comprehensive income and relevant notes reflect the classification of the UK
Retail business as a discontinued operation in 2023. Additionally, prior year amounts have been
represented in notes 3(e) and 29 for consistency with the disclosure in the current year. Prior
year figures in note 3(e) have been represented to correct for previously omitted amounts.
There is no impact on prior year primary financial statements from these adjustments.
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Designation of Ethiopia as a hyperinflationary economy
The Group financial statements include adjustments for hyperinflation, following the application
of IAS 29 Financial Reporting in Hyperinflationary Economies in relation to the Group’s
operations with a functional currency of Ethiopian Birr.
The Group’s consolidated financial statements include the results and financial position of its
Ethiopian operations restated to the purchasing power or inflationary measuring unit current at
the end of the year, leading to a hyperinflationary loss in respect of monetary items being
reported in finance costs, and treated as an adjusting item. The results of the Group’s Ethiopian
operations have been translated at the closing exchange rate, as required by IAS 21 The
Effects of Changes in Foreign Exchange Rates for hyperinflationary foreign operations.
Whilst IAS 29 Financial Reporting in Hyperinflationary Economies is applied in individual financial
statements as though the relevant economy was always hyperinflationary, comparative
amounts are not restated in consolidated amounts already presented in a stable currency. The
resulting difference in the opening Ethiopian net assets has been presented as a translation
adjustment in other comprehensive income.
The inflationary factors used by the Group are the official price indices published by the
Central Statistical Agency of Ethiopia. Hyperinflationary adjustments have been calculated
using the price index prevailing at 31 December 2024, which was a CPI index of 495.4 (31
December 2023: CPI index 425.1). The adjusted results and financial position of Ethiopia were
translated at the year-end closing rate before being included in the Group’s consolidated
financial statements.
Climate change
In preparing the Group’s financial statements consideration has been given to the impact of
both physical and transition climate-related risks, as described in the Task Force on Climate-
related Financial Disclosures (TCFD) section on page 35. Based on the TCFD recommendations,
in 2022, the Group performed an assessment of the five most critical climate related risks and
opportunities that were considered to have a potential financial impact on the
financial statements.
Climate scenario analysis was used as a tool to identify and assess a potential range of future
outcomes, by capturing different assumptions about policies and physical climate conditions.
Scenario analysis was applied to the five most material risks and opportunities, being the
transition risk of misalignment, increased carbon tax, aftersales revenues, margin pressure risk,
and physical risks (due to the direct impacts to property and inventories from extreme weather
conditions). There is inherent uncertainty over the assumptions used within these scenarios and
how they will impact the Group’s operations, cash flows and profit projections.
The policy, technology, and market changes in response to climate change are still
developing, and consequently the financial statements cannot capture all possible future
outcomes as these are not yet known.
The climate-related estimates and assumptions were applied primarily to going concern,
impairment of non-financial assets, property, plant and equipment, indefinite life intangible
assets and provisions. Management has concluded there to be no material impact arising from
climate change on the judgements and estimates made in the financial statements.
Revenue and other income
IFRS 15 Revenue from Contracts with Customers provides a single, principles-based, five-step
model to be applied to all sales contracts. It is based on the transfer of control of goods and
services to customers and requires the identification and assessment of the satisfaction of
delivery of each performance obligation in contracts in order to recognise revenue. Where
separate performance obligations are identified in a single contract, total revenue is allocated
on the basis of relative stand-alone selling prices to each performance obligation, or
management’s best estimate of relative value where stand-alone selling prices do not exist.
Revenue is measured at the fair value of consideration receivable, net of any discounts,
rebates, trade allowances, incentives, or amounts collected on behalf of third parties. It is
recognised to the extent that the transfer of promised goods or services to a customer has
been satisfied and the revenue can be reliably measured. Revenue excludes sales-related
taxes and intra-group transactions. In practice this means that:
Revenue from sale of goods
Revenue from the sale of goods is recognised when the control, risks and rewards of ownership
of the goods have been transferred to the customer. The performance obligation to transfer
goods to the customer is considered to have been satisfied when the vehicles or parts are
invoiced and physically dispatched or collected. Revenue is also recognised in circumstances
where goods are available for delivery, but the customer has requested that delivery does not
take place, has confirmed ownership of the goods and assumed responsibility for the
associated risks. Consideration received in advance of transfer of goods is recognised as
deferred revenue on the balance sheet and is subsequently recognised as revenue when the
transfer of goods occurs.
Revenue from rendering of services
Revenue from the rendering of services to the customer is considered to have been satisfied
when the service has been performed.
Group acts as an agent
Where the Group acts as an agent on behalf of a principal in relation to finance, insurance, and
similar products, the associated commission income is recognised within revenue in the period in
which the activity which generated the commission was performed.
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Sales with a repurchase commitment
Where a vehicle is sold to a customer subject to a repurchase commitment and the possibility
of the buyback being exercised by the customer is highly likely, as the customer has a
significant economic incentive to exercise the buyback, the transaction is recognised as a
lease transaction with the Group acting as a lessor. Consequently, such vehicles are
recognised within ‘property, plant and equipment’ in the consolidated statement of financial
position at cost and are depreciated to their residual value over the period of the repurchase
commitment. The difference between the initial amounts received from the customer and the
repurchase commitment is recognised as deferred income in the consolidated statement of
financial position and is released to the consolidated income statement on a straight-line basis
over the life of the arrangement. The repurchase commitment, which reflects the price at
which the vehicle will be bought back, is held within ‘trade and other payables’, according to
the date of the commitment.
Where a vehicle is sold to a customer subject to a repurchase commitment and the possibility
of the buyback being exercised by the customer is not highly likely, revenue is recognised in full
when the vehicle is sold, less the expected value of the buyback payments to be made which
is recorded as a liability in the consolidated statement of financial position. Similarly, an
estimate of the value of the vehicles to be returned is deducted from cost of sales and
recognised as an asset in the consolidated statement of financial position
Sale of additional services
Where additional services are included in the sale of a vehicle to a customer as part of the
total vehicle package (e.g. extended warranty, free servicing, roadside assistance, fuel
coupons etc) and the Group is acting as a principal in the fulfilment of the service, the value of
the additional services is separately identified, deducted from consideration receivable,
recognised as deferred revenue on the balance sheet and subsequently recognised as
revenue when the service is provided, or recognised on an input basis with reference to the
amount of time elapsed under the contract to which the service relates. These balances are
considered to be contract liabilities. The consideration allocated to additional services is based
on the relative stand-alone selling price of the additional services within the contract. The value
assigned to the additional service is set equal to the value of the additional service being
provided, being the expected cost to the entity plus an appropriate profit margin.
Accrued income
Amounts relating to accrued income are balances primarily due from manufacturers in relation
to volume/ target related bonuses or commissions or warranty related where the work has
been completed prior to being invoiced. Any amount previously recognised as accrued
income is reclassified to trade receivables after invoicing.
Dividend income
Dividend income is recognised when the right to receive payment is established.
Cost of sales
Cost of sales includes the expense relating to the estimated cost of self-insured product
warranties offered to customers. These warranties form part of the package of goods and
services provided to the customer when purchasing a vehicle and are not a separable
product.
The Group receives income in the form of various incentives which are determined by our
brand partners. The amount the Group receives is generally based on achieving specific
objectives, such as a specified sales volume, as well as other objectives including maintaining
brand partner standards which may include, but are not limited to, retail centre image and
design requirements, customer satisfaction survey results and training standards. Where
incentives are based on a specific sales volume or number of registrations, the related income
is recognised as a reduction in cost of sales when it is reasonably certain that the income has
been earned. This is generally the later of the date the related vehicles are sold or registered or
when it is reasonably certain that the related target will be met. Where incentives are linked to
retail centre image and design requirements, customer satisfaction survey results or training
standards, they are recognised as a reduction in cost of sales when it is reasonably certain that
the incentive will be received for the relevant period.
Share-based payments
The Group operates various share-based award schemes. The fair value at the date at which
the share-based awards are granted is recognised in the consolidated income statement
(together with a corresponding credit in shareholders’ equity) on a straight-line basis over the
vesting period, based on an estimate of the number of shares that will eventually vest. At the
end of each reporting period, the Group revises its estimates of the number of awards that are
expected to vest. The impact of any revision is recognised in the consolidated income
statement with a corresponding adjustment to equity.
For equity-settled share-based awards, the services received from employees are measured by
reference to the fair value of the awards granted. With the exception of the Group Save As
You Earn scheme, the vesting of all share-based awards under all schemes is solely reliant upon
non-market conditions, therefore no expense is recognised for awards that do not ultimately
vest. Where an employee or the Company cancels an award, the charge for that award is
recognised as an expense immediately, even though the award does not vest.
Finance income
Finance income is recognised when it is probable that the economic benefits will flow to the
Group and the amount of income can be measured reliably. It is accrued on a time basis by
reference to the principal outstanding and at the effective interest rate applicable.
Finance costs
Finance costs are recognised as an expense, calculated using the effective interest rate
method, in the period in which they are incurred.
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Income tax
The charge for current income tax is based on the results for the period as adjusted for items
which are not taxed or are disallowed. It is calculated using tax rates that have been enacted
or substantively enacted by the end of the reporting period.
The Group recognises provisions for uncertain tax positions in line with IFRIC 23 Uncertainty over
Income Tax Treatments when it is not probable that a tax authority will accept an uncertain tax
treatment used, or proposed to be used, in its income tax filings. Uncertain tax positions are
assessed and measured using management’s estimate of the most likely outcome including an
assessment of whether uncertain tax positions should be considered separately or as a group.
Deferred income tax is accounted for using the liability method in respect of temporary
differences arising from differences between the tax bases of assets and liabilities and their
carrying amounts in the consolidated financial statements.
Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax
assets are recognised to the extent that it is probable that taxable profits will be available
against which deductible temporary differences can be utilised. Such assets and liabilities are
not recognised if the temporary difference is due to the initial recognition of goodwill arising on
a business combination, or to an asset or liability, the initial recognition of which does not affect
either taxable or accounting income.
Deferred tax liabilities are recognised for taxable temporary differences arising on investments
in subsidiaries, joint ventures, and associates, except where the Group is able to control the
reversal of the temporary difference and it is probable that the temporary difference will not
reverse in the foreseeable future.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the
asset is realised or the liability is settled using rates enacted or substantively enacted at the end
of the reporting period. Deferred tax is charged or credited in the consolidated income
statement, except when it relates to items credited or charged directly to shareholders’ equity,
in which case the deferred tax is also dealt with in shareholders’ equity. Deferred tax assets and
liabilities are only offset where there is a legally enforceable right of offset of current tax assets
against current tax liabilities and if the deferred tax relates to income taxes levied by the same
tax authority.
The measurement of deferred tax liabilities and assets reflects the tax consequences that
would follow from the manner in which the Group expects, at the end of the reporting period,
to recover or settle the carrying amount of its assets and liabilities.
Adjusting items
The Group makes certain adjustments to the statutory profit measures in order to derive certain
alternative performance measures. Certain items which are material are presented as
adjusting items within their relevant consolidated income statement category. The separate
reporting of adjusting items helps provide additional useful information regarding the Group’s
underlying financial performance and is used by management to facilitate internal
performance analysis.
Management applies an adjusting items policy that is regularly discussed and approved by the
Audit Committee. The policy applied in identifying adjusting items is balanced when assessing
gains and losses, clearly disclosed, and applied consistently from one year to the next.
Adjusting items are deemed to be those items that, in the judgement of the Group, need to be
disclosed separately by virtue of their nature, size or incidence. In determining the facts and
circumstances, management considers key factors such as:
• where the same category of items recurs each year and in similar amounts (for example,
restructuring costs), consideration is given as to whether such amounts should be included as
part of underlying profit;
• where significant items are likely to be finalised over more than one year, the effect of such
items is applied uniformly; and
• ensuring the treatment of favourable and unfavourable transactions are treated consistently.
Items that may be considered adjusting in nature could include gains or losses on the disposal
of businesses, restructuring of businesses, acquisition and integration costs, asset impairments,
recognition of monetary gains or losses on hyperinflation and the tax effects of these items. Any
reversal of an amount previously recognised as an adjusting item would also be recognised as
an adjusting item in a subsequent period.
Business combinations and goodwill
The acquisition of subsidiaries is accounted for using the acquisition method (at the point the
Group gains control over a business as defined by IFRS 3 Business Combinations). The cost of
the acquisition is measured as the cash paid and the aggregate of the fair values, at the date
of exchange, of other assets transferred, liabilities incurred or assumed, and equity instruments
issued by the Group in exchange for control of the acquiree. The consideration transferred
includes the fair value of any asset or liability resulting from a contingent consideration
arrangement at the acquisition date.
Acquisition-related costs are expensed as incurred. The acquiree’s identifiable assets, liabilities
and contingent liabilities that meet the conditions for recognition under IFRS 3 Business
Combinations are recognised at their fair value at the acquisition date. The Group recognises
any non-controlling interests in the acquiree on an acquisition-by-acquisition basis, either at fair
value or at the non-controlling interests’ proportionate share of the recognised amounts of
acquiree’s identifiable net assets.
Goodwill represents the excess of the cost of acquisition of a business combination over the
Group’s share of the fair value of identifiable net assets of the business acquired at the date
of acquisition. Goodwill is initially recognised at cost and is held in the functional currency of
the acquired entity and revalued at the closing exchange rate at the end of each
reporting period.
After initial recognition, goodwill is measured at cost less any accumulated impairment losses.
At the date of acquisition, the goodwill is allocated to cash generating units for the purpose of
impairment testing and is tested at least annually for impairment.
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Gains and losses on disposal of a business include the carrying amount of goodwill relating to
the business sold except for goodwill arising on business combinations on or before 31
December 1997 which has been deducted from shareholders’ equity and remains indefinitely
in shareholders’ equity.
Other intangible assets
Intangible assets, when acquired separately from a business (including computer software), are
carried at cost less accumulated amortisation and impairment losses. Cost comprises the
purchase price from third parties as well as internally generated development costs where
relevant. Amortisation is provided on a straight-line basis to allocate the cost of the asset over
its estimated useful life, which in the case of computer software is three to eight years.
Amortisation is recognised in the consolidated income statement within ‘net operating
expenses’. Software customisation and configuration costs relating to software not controlled
by the Group are expensed over the period such services are received.
Intangible assets acquired as part of a business combination are capitalised separately from
goodwill if the benefit of the intangible asset is obtained through contractual or other legal
rights and the fair value can be measured reliably on initial recognition. The principal intangible
assets are agreements with manufacturers for the distribution of new vehicles and parts, which
represent the estimated value of distribution rights acquired in business combinations. Such
agreements have varying terms and periods of renewal and have historically been renewed
without substantial cost. The Group therefore expects these agreements to be renewed on a
regular basis and accordingly no amortisation is charged on these assets. The Group assesses
these distribution rights for impairment on an annual basis.
Other intangible assets acquired in a business combination may include order banks and
customer contracts. These intangible assets are amortised on a straight-line basis over their
estimated useful life, which is between one and ten years.
Property, plant and equipment
Property, plant and equipment is stated at cost less accumulated depreciation and
impairment losses. Cost comprises the purchase price and directly attributable costs of the
asset and includes, where relevant, capitalised borrowing costs. Depreciation is based on cost
less estimated residual value and is included within ‘net operating expenses’ in the
consolidated income statement, with the exception of depreciation on ‘leased vehicles, rental
machinery and equipment’ which is charged to ‘cost of sales’. It is provided on a straight-line
basis over the estimated useful life of the asset, except for freehold land which is not
depreciated. For the following categories, the annual rates used are:
Freehold buildings and long leasehold
buildings
2.0%
Short leasehold buildings
shorter of lease term or useful life
Plant, machinery and equipment
5.0% – 33.3%
Leased vehicles, rental machinery and
equipment
over the lease term
The residual values and useful lives of all assets are reviewed at least at the end of each
reporting period and adjusted if necessary.
Leases
The Group assesses whether a contract is, or contains a lease at inception of the contract. A
lease conveys the right to direct the use and obtain substantially all of the economic benefits
of an identified asset for a period of time in exchange for consideration.
The group as a lessee
Lease liabilities arising from a lease are initially measured on a present value basis. Lease
liabilities include the net present value of the following lease payments:
• fixed payments (including in-substance fixed payments), less any lease incentives receivable;
• variable lease payment that are based on an index or a rate, initially measured using the
index or rate as at the commencement date;
• amounts expected to be payable by the Group under residual value guarantees;
• the exercise price of a purchase option if the Group is reasonably certain to exercise that
option; and
• payments of penalties for terminating the lease, if the lease term reflects the Group
exercising that option.
Lease payments to be made under reasonably certain extension options are also included in
the measurement of the liability.
The lease payments are discounted using the interest rate implicit in the lease. If that rate
cannot be readily determined, which is generally the case for leases in the Group, the lessee’s
incremental borrowing rate is used, being the rate that the individual lessee would have to pay
to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a
similar economic environment with similar terms, security, and conditions.
To determine the incremental borrowing rate, the Group:
• uses a build-up approach that starts with a risk-free interest rate by market and currency;
• applies a credit risk, based on yields of comparable entities, to the determined risk-free
interest rate by market; and
• where applicable, makes adjustments specific to the lease, e.g. country, currency, security,
and term.
Lease liabilities are remeasured when there is a change in future lease payments as a result of
an index or rate change, or if there is a change in the estimate of the amount expected to be
payable under a residual value guarantee, or if there is a change in the assessment of whether
a purchase, lease-term extension or termination option will be exercised. When lease liabilities
are remeasured in this way, a corresponding adjustment is made to the carrying amount of the
right-of-use asset or recorded in profit or loss if the carrying amount of the right-of-use asset has
been reduced to zero.
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Lease payments are allocated between principal and finance cost. The finance cost is
charged to profit or loss over the lease period to produce a constant periodic rate of interest
on the remaining balance of the liability for each period. Right-of-use assets are recognised at
the commencement date of the lease. Right-of-use assets comprising mainly land and
buildings are measured at cost less accumulated depreciation and impairment losses. The
costs include the amount of the initial measurement of the lease liability, any lease payments
made at or before the commencement date less lease incentives received, any direct costs
and an estimate of dismantling costs. The carrying amount is further adjusted for any
remeasurement of the lease liability. Depreciation is expensed to the income statement on a
straight-line basis over the lease term. The lease term includes the noncancellable period of
lease together with any extension or termination options that are reasonably certain to
be exercised.
Payments associated with short-term leases and all leases of low-value assets (under £5,000)
are recognised on a straight-line basis as an expense in profit or loss. Short-term leases are
leases with a lease term of 12 months or less. Low-value assets comprise largely small items of
office equipment.
The group as a lessor
Leases are classified as finance leases whenever the terms of the lease transfer substantially all
the risk and rewards of ownership to the lessee. All other leases are classified as operating
leases. Where the Group is an intermediate lessor, the sublease classification is assessed with
reference to the head lease right-of-use asset. Amounts due from lessees under finance leases
are recorded as receivables at the amount of the Group’s net investment in the lease. Finance
lease income is allocated to accounting periods so as to reflect a constant periodic rate of
return on the Group’s net investment in the lease. Rental income from operating leases is
recognised on a straight-line basis over the lease term.
Impairment of non-financial assets
Assets that are subject to amortisation or depreciation are reviewed for impairment
whenever events or circumstances indicate that the carrying amount may not be recoverable.
Any impairment losses are included within ‘net operating expenses’ in the consolidated
income statement.
In addition, goodwill is not subject to amortisation but is tested at least annually for impairment.
An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds
its recoverable amount, the latter being the higher of the asset’s fair value less costs to sell and
value in use. Value in use calculations are performed using cash flow projections, discounted
at a pre-tax rate which reflects the asset specific risks and the time value of money. Impairment
losses are recognised on goodwill within the cash generating unit.
Non-financial assets, other than goodwill, which have previously been impaired, are reviewed
for possible reversal of the impairment at each reporting date. Impairment of inventories are
considered separately. Impairment losses are recognised against goodwill within the cash
generating units before non-financial assets are impaired.
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost comprises expenditure
incurred in bringing inventories to their present location and condition. Net realisable value
represents the estimated selling price less all estimated costs of completion and costs to be
incurred in marketing, selling and distribution. Used vehicles are carried at the lower of cost or
fair value less costs to sell, generally based on external market data available for used vehicles.
Parts inventory is valued at weighted average cost.
Vehicles held on consignment are included within inventories as the Group is considered to
have the risks and rewards of ownership. The corresponding liability is included within ‘trade
and other payables’.
Inventory can be held on deferred payment terms. All costs associated with this deferral are
expensed to finance costs over the period of the financing.
An inventory provision is recognised in situations where net realisable value is likely to be less
than cost (such as obsolescence, deterioration, fall in selling price). When calculating the
provision, management considers the nature and condition of the inventory, as well as
applying assumptions around anticipated saleability, determined on conditions that exist at the
end of the reporting period. With the exception of parts, generally net realisable value
adjustments are applied on an item-by-item basis.
Trade receivables
Trade receivables are amounts due from customers for goods sold or services performed in the
ordinary course of business. These are recognised as current assets if collection is due in one
year or less. If collection is due in over a year, they are presented as non-current assets.
Trade receivables are recognised initially at fair value and subsequently measured at
amortised cost using the effective interest method, less provision for impairment. A provision for
impairment is established based on an expected credit loss model under IFRS 9 Financial
Instruments. The amount of the provision is the difference between the asset’s carrying amount
and the expected value of the amounts to be received.
The provision for impairment of receivables is based on lifetime expected credit losses. Lifetime
expected credit losses are calculated by assessing historic credit loss experience, adjusted for
factors specific to the receivable and company. The amount of the loss is recognised in the
consolidated income statement within ‘net operating expenses’. When a trade receivable is
not collectible, it is written off against the allowance account for trade receivables.
Subsequent recoveries of amounts previously written off are credited against ‘net operating
expenses’ in the consolidated income statement.
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Trade payables
Trade payables are obligations to pay for goods or services that have been acquired in the
ordinary course of business. These are classified as current liabilities if payment is due in one
year or less. If payment is due at a later date, they are presented as non-current liabilities.
Trade payables are recognised initially at fair value and subsequently measured at amortised
cost using the effective interest method.
Trade payables include the liability for vehicles held on consignment, with the corresponding
asset included within inventories. Included within trade and other payables are payments
received on account. These are deposits received from customers, in relation to orders taken
but not yet delivered, and represent an obligation to deliver a vehicle to a customer.
Pensions and other post-retirement benefits
The Group operates a number of retirement benefit schemes.
The major schemes are defined benefit pension funds with assets held separately from the
Group. The cost of providing benefits under the plans is determined separately for each plan
using the projected unit credit actuarial valuation method.
The current service cost and gains and losses on settlements and curtailments are included in
‘cost of sales’ or ‘net operating expenses’ in the consolidated income statement. Past service
costs are similarly recognised in the consolidated income statement. Administrative scheme
expenses associated with the plans are recorded within ‘net operating expenses’ when
incurred, in line with IAS 19 Employee Benefits (revised). Net interest income or interest cost
relating to the funded defined benefit pension plans is included within ‘finance income’ or
‘finance costs’, as relevant, in the consolidated income statement.
Changes in the retirement benefit obligation or asset due to experience and changes in
actuarial assumptions are included in the consolidated statement of comprehensive income,
as actuarial gains and losses, in full in the period in which they arise.
Where scheme assets exceed the defined benefit obligation, a net asset is only recognised to
the extent that an economic benefit is available to the Group, in accordance with the terms of
the scheme and, where relevant, statutory requirements.
The Group’s contributions to defined contribution plans are charged to the consolidated
income statement in the period to which the contributions relate.
The Group also has a liability in respect of past employees under post-retirement healthcare
schemes which have been closed to new entrants. These schemes are accounted for on a
similar basis to that for defined benefit pension plans in accordance with the advice of
independent qualified actuaries.
Following the scheme merger which is now referred to as the ‘Combined section’, and sits
alongside the Group section, a change was made to the trustees deeds whereby it was
stipulated, in the event of a wind-up any pension surplus belonging to the Group section would
be returned to the Combined section in the first instance instead of being directly returned to
the principal employer. The Group takes the view that any surplus in the Combined section
ultimately belongs to the Principal employer, therefore judgement has been taken to recognise
the pension surplus for the scheme in full.
Provisions
Provisions are recognised when the Group has a present obligation in respect of a past event,
when it is more likely than not that an outflow of resources will be required to settle the
obligation and where the amount can be reliably estimated. Provisions are discounted when
the time value of money is considered to be material, using an appropriate risk-free rate on
government bonds.
Product warranty provision
A product warranty provision corresponds to warranties provided as part of the sale of a
vehicle and provide assurance to the customer that the product will work as sold. Provision is
made for the expected cost of labour and parts based on historical claims experience and
expected future trends.
Leasehold property provision
A leasehold property provision is recognised when the Group is committed to certain leasehold
premises for which it no longer has a commercial use. It is made to the extent of the estimated
future net cost, excluding the lease liability already recognised under IFRS 16 Leases. A
leasehold property provision is also recognised when there is future obligation relating to the
maintenance of leasehold properties. The provision is based on management’s best estimate
of the obligation which forms part of the Group’s unavoidable cost of meeting its obligations
under the lease contracts.
Litigation provision
A litigation provision is recognised when a litigation case is outstanding at the end of the
reporting period and there is a likelihood that the legal claim will be settled.
Restructuring provision
A restructuring provision is recognised when a detailed formal plan for the restructuring has
been developed and a valid expectation has been raised in those affected that it will carry
out the restructuring by starting to implement the plan or announcing its main features to those
affected by it. The measurement of a restructuring provision includes only the direct
expenditures arising from the restructuring, which are those amounts that are both necessarily
entailed by the restructuring and not associated with ongoing activities of the Group.
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Disposal group and assets held for sale
Where the Group is committed to a plan to sell and is actively marketing a business and
disposal is expected within one year of the date of classification as held for sale, the assets and
liabilities of the associated businesses are separately disclosed in the consolidated statement of
financial position as a disposal group. Assets and liabilities are classified as assets held for sale if
their carrying amount is to be recovered principally through a sale transaction rather than
through continuing use. Both disposal groups and assets and liabilities held for sale are stated
at the lower of their carrying amount and fair value less costs to sell.
Segmental reporting
Segment information is reported in accordance with IFRS 8 Operating Segments, which requires
segmental reporting to be presented on the same basis as the internal management reporting.
The Group’s operating segments are groups of countries and the market channel, Distribution.
These operating segments are then aggregated into reporting segments to combine those
with similar characteristics. The accounting policies of the reportable segments are the same as
the Group’s accounting policies described in this note. Comparative amounts have been
reclassified as explained in note 1.
Financial instruments
The Group classifies its financial assets in the following categories: measured at amortised cost;
measured at fair value through profit and loss; and measured at fair value through other
comprehensive income. Classification and subsequent remeasurement depends on the
Group’s business model for managing the financial asset and its cash flow characteristics.
Assets that are held for collection of contractual cash flows, where those cash flows represent
solely payments of principal and interest, are measured at amortised cost.
Measured at amortised cost includes non-derivative financial assets and liabilities with fixed or
determinable payments that are not quoted in an active market. Financial assets are included
in current assets, except where the maturity date is more than 12 months after the end of the
reporting period. They are initially recorded at fair value and subsequently recorded at
amortised cost. Financial liabilities are included in current liabilities, except where the maturity
date is more than 12 months after the end of the reporting period. Financial liabilities with a
maturity date that is more than 12 months after the end of the reporting period and subject to
a covenant are classified as non-current where the Group is compliant with that covenant at
the reporting date.
Measured at fair value through profit and loss includes derivative financial assets and liabilities,
which are further explained below. They are classified according to maturity date, within
current and non-current assets and liabilities respectively.
Measured at fair value through other comprehensive income includes certain financial assets
at fair value such as bonds and equity investments. These financial assets are included in
current assets, except where the maturity date is more than 12 months after the end of the
reporting period. Financial assets at fair value through other comprehensive income are
classified as non-current assets unless management intends to dispose of them within 12
months of the end of the reporting period and are held at fair value.
Cash and cash equivalents
Cash and cash equivalents in the consolidated statement of financial position comprise cash
at bank and in hand, short-term bank deposits and cash and cash equivalents included in
disposal groups held for sale. Short-term bank deposits have a maturity of less than three
months from the date at which the investment is acquired. In the consolidated statement of
cash flows, cash and cash equivalents comprise cash and cash equivalents, as defined above,
net of bank overdrafts.
Financial assets at fair value through other comprehensive income
Financial assets at fair value through other comprehensive income are primarily equity
instruments that are recognised initially at fair value (including costs to acquire) and re-
measured subsequently with gains and losses recognised directly in other comprehensive
income. Cumulative gains and losses are recycled to the Group income statement on disposal.
Borrowings
Borrowings are recognised initially at fair value, net of transaction costs incurred, and are
subsequently stated at amortised cost. Any difference between the proceeds (net of
transaction costs) and the redemption value is recognised in the consolidated income
statement over the period of the borrowings, using the effective interest method.
Offsetting
Netting in the consolidated statement of financial position only occurs to the extent that there
is the legal ability and intention to settle net. As such, bank overdrafts are presented in current
liabilities to the extent that there is no intention to offset with the cash balance.
Derivative financial instruments
An outline of the objectives, policies and strategies pursued by the Group in relation to its
financial instruments is set out in note 23 to the consolidated financial statements.
Derivatives are initially recognised at fair value on the date a derivative contract is entered into
and are subsequently re-measured at their fair value. The method of recognising the resulting
gain or loss depends on whether the derivative is designated as a hedging instrument, and if
so, the nature of the item being hedged. Derivative financial instruments are derecognised
when they are settled. The Group designates certain derivatives as:
• hedges of the fair value of recognised assets or liabilities or a firm commitment (fair value
hedge); or
• hedges of a particular risk associated with a recognised asset or liability or a highly probable
forecast transaction (cash flow hedge).
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Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as fair value hedges
are recorded in the consolidated income statement, together with any changes in the fair
value of the hedged asset or liability that are attributable to the hedged risk. The Group only
applies fair value hedge accounting for hedging fixed interest risk on borrowings and future
fixed amount currency liabilities (on its cross-currency interest rate swaps). The gain or loss
relating to the effective portion of interest rate swaps hedging fixed rate borrowings and
changes in the fair value of those borrowings is recognised in the consolidated income
statement within ‘finance costs’. The gain or loss relating to the ineffective portion is also
recognised in the consolidated income statement within ‘finance costs’.
Cash flow hedge
For cash flow hedges that meet the conditions for hedge accounting, the portion of the gains
or losses on the hedging instrument that is determined to be an effective hedge is recognised
directly in other comprehensive income and the ineffective portion is recognised within ‘net
operating expenses’ in the consolidated income statement. When the hedged forecast
transaction results in the recognition of a non-financial asset or liability then, at the time the
asset or liability is recognised, the associated gains or losses that had previously been
recognised in other comprehensive income are included in the initial measurement of the
acquisition cost or other carrying amount of the asset or liability. For all other cash flow hedges,
the gains or losses that are recognised in other comprehensive income are transferred to the
consolidated income statement in the same period in which the hedged forecast transaction
affects the consolidated income statement.
Share capital
Ordinary shares are classified as equity. Where the Group purchases the Group’s equity share
capital (treasury shares), the consideration paid is deducted from shareholders’ equity until the
shares are cancelled, reissued, or disposed of. Where such shares are subsequently sold or
reissued, any consideration received is included in shareholders’ equity.
Dividends
Final dividends proposed by the Board of Directors and unpaid at the year-end are not
recognised in the consolidated financial statements until they have been approved by the
shareholders at the Annual General Meeting. Interim dividends are recognised when they
are paid.
Critical accounting judgements and sources of estimation uncertainty
The preparation of financial statements in accordance with generally accepted accounting
principles requires the use of estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Although these estimates are based on
management’s best knowledge, actual results may ultimately differ from those estimates. The
estimates and underlying assumptions are reviewed on an ongoing basis. The Directors have
made a number of estimates and assumptions regarding the future, and made some
significant judgements in applying the Group’s accounting policies. These are discussed below:
Sources of estimation uncertainty
The key assumptions about the future, and other key sources of estimation uncertainties at the
reporting period end that may have a significant risk of causing a material adjustment to the
carrying amount of assets and liabilities within the next period are discussed below:
Impairment of goodwill and indefinite life intangible assets
Goodwill and other indefinite life intangible assets are tested at least annually for impairment.
When an impairment review is carried out, the recoverable value is determined based on
value in use calculations which require the use of estimates, including projected future cash
flows (see note 10).
The value in use calculations mainly use cash flow projections based on three-year financial
forecasts prepared by management. The key assumptions for these forecasts are those relating
to volumes, revenue, gross margins, the level of working capital required to support trading,
discount rates, long-term growth rate and capital expenditure. For all CGU groups, cash flows
after the three-year period are extrapolated for a further seven years using declining growth
rates which reduces the year three growth rate down to the long-term growth rate appropriate
for each CGU or CGU group, to better reflect the medium-term growth expectations for those
markets. A terminal value calculation is used to estimate the cash flows after year 10 using
these long-term growth rates.
The assumptions used in the value in use calculations are based on past experience, recent
trading, and forecasts of operational performance in the relevant markets. They also reflect
expectations about continuing relationships with key mobility partners and the impact climate
change may have on its operations. Whilst at this stage there is significant uncertainty
regarding what the long-term impact of climate change initiatives may be on the markets in
which we operate, the forecasts reflect our best estimate. Key assumptions and sensitivities are
disclosed in note 10.
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Pensions and other post-retirement benefits – assumptions
Pension and other post-retirement benefit liabilities are determined based on the actuarial
assumptions detailed in note 5. A number of these assumptions require estimates to be made,
including the rate of inflation and expected mortality rates. These assumptions are subject to a
review on an annual basis and are determined in conjunction with an external actuary. The use
of different assumptions could have a material effect on the value of the relevant liabilities and
could result in a material change to amounts recognised in the income statement over time.
Key assumptions and sensitivities for post-employment benefit obligations are disclosed in
note 5.
Pensions – discount rate
The Group’s defined benefit obligations are discounted at a rate set by reference to market
yields at the end of the reporting period on high quality corporate bonds. Significant
judgement is required when setting the criteria for bonds to be included in the population from
which the yield curve is derived. The most significant criteria considered for the selection of
bonds include the issue size of the corporate bonds, quality of the bonds and the identification
of outliers which are excluded. Key assumptions and sensitivities for post-employment benefit
obligations are disclosed in note 5.
Critical accounting judgements
Right-of-use assets and lease liabilities – extension and termination options
In determining the lease term, management considers all facts and circumstances that create
an economic incentive to exercise an extension option, or not exercise a termination option.
Extension options (or periods after termination options) are only included in the lease term if the
lease is reasonably certain to be extended (or not terminated).
The Group has several retail, distribution and office property lease contracts that include
extension and termination options. The Group applies judgement in evaluating whether it is
reasonably certain whether or not to exercise the option to renew or terminate the lease. All
relevant factors are considered that create an economic incentive for it to exercise either the
renewal or termination, including: whether there are significant penalties to terminate (or not
extend); whether any leasehold improvements are expected to have a significant remaining
value; historical lease durations; the importance of the underlying asset to the Group’s
operations; and the costs and business disruption required to replace the leased asset.
The assessment is reviewed if a significant event or a significant change in circumstances
occurs which affects this assessment and that is within the control of the lessee. Refer to note 12
for additional disclosures relating to leases.
Adjusting items
The Group believes that adjusted profit and earnings per share measures provide additional
useful information to shareholders on the performance of the business. These measures are
consistent with how business performance is measured internally by the Board and Executive
Committee. Alternative performance measures, such as the operating profit before adjusting
items and profit before tax and adjusting items, are not recognised profit measures under IFRS
and may not be directly comparable with such profit measures used by other companies. They
may also exclude significant recurring business transactions that impact financial performance
and cash flows. The classification of adjusting items requires significant management
judgement after considering the nature and intentions of a transaction. The Group’s definitions
of adjusting items are outlined within the Group accounting policies and note 2 provides further
details on current year adjusting items and their adherence to Group policy.
Classification of vehicle funding arrangements
The Group finances the purchase of vehicles using vehicle funding facilities provided by various
lenders including the captive finance companies associated with mobility partners. In assessing
whether the liabilities arising under these arrangements should be classified within trade and
other payables rather than as an additional component of the Group’s net debt within
borrowings, the Group considers a number of factors including whether the arrangement is a
requirement of the relationship with the mobility company partner, in relation to specific,
separately identifiable vehicles held as inventory and whether payment terms are consistent
with the normal working capital cycle or until the specific vehicle being funded is sold to the
end customer. Each agreement entered into has its own terms and conditions and determining
whether a new or renewed arrangement should be classified within trade and other payables
requires significant management judgement. See also note 20.
Assignment of an indefinite useful life to distribution agreements
The Group’s principal intangible assets relate to relationships with manufacturers for the
distribution of new vehicles and parts. As at 31 December 2024, these distribution agreements
were assigned an indefinite useful life as although these agreements have limited terms, they
have historically been renewed by the Group without substantial cost and the Group’s history
shows that mobility company partners have not terminated any material distribution
agreements. Following the announcement of the Accelerate+ strategy the Group is
considering what impact, if any, this may have on the judgement to assign an indefinite useful
life to distribution agreement assets for the financial year ended 31 December 2025. Should
any change arise, this will be made prospectively and be accounted for as a change in
accounting estimate. Refer to note 10 for details of indefinite-life distribution agreement
intangible assets.
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1 Segmental analysis
The Group has three reportable segments which have been identified based on the operating
segments of the Group that are regularly reviewed by the chief operating decision-maker,
which has been determined to be the Group Executive Team, in order to assess performance
and allocate resources. Operating segments are then aggregated into reporting segments to
combine those with similar economic characteristics. Following the classification in the current
period of the Group's retail operations in the UK as a discontinued operation, the Group’s
internal reporting has been updated to no longer distinguish between ‘Distribution’ and
‘Retail’. As a result the Group’s remaining retail operation in Europe has been combined with
the Europe & Africa distribution business to form a single reportable segment.
The Group reports the performance of its reporting segments after the allocation of central
costs. These represent costs of Group functions. Reporting segment performance for 2023 has
been restated for the re-allocation of central costs following the classification of the UK retail
operations as a discontinued operation.
The following summary describes the operations of each of the Group’s reportable segments:
APAC
Europe & Africa
Americas
Exclusive distribution, sales and marketing activities of New Vehicles
and Parts.
Sale of New and Used Vehicles together with logistics services
where the Group may also be the exclusive distributor, alongside
associated Aftersales activities of service, body shop repairs and
parts sales.
APAC
Europe &
Africa
Americas
Total
2024
£m
£m
£m
£m
Revenue
Total revenue
2,995
3,003
3,265
9,263
Adjusted operating profit from continuing operations
235
142
207
584
Operating adjusting items
(22)
Operating profit from continuing operations
562
Share of profits after tax of joint ventures and
associates
2
Profit before finance and tax
564
Finance income
71
Finance costs
(221)
Profit before tax from continuing operations
414
Tax
(129)
Profit for the year from continuing operations
285
The Group’s reported segments are based on the location of the Group’s assets. Revenue
earned from sales is disclosed by origin and is not materially different from revenue by
destination. Chile and Australia are presented separately as these comprise more than 10% of
the Group’s revenue. Revenue is further analysed as follows:
2024
£m
Revenue
Chile
1,532
Australia
1,142
Rest of the world
6,589
Group
9,263
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1 Segmental analysis continued
The Group’s non-current assets by location comprise intangible assets, property, plant and
equipment, right-of-use assets, investments in joint ventures and associates, and are analysed
below. Chile is presented separately as it comprises more than 10% of the Group’s
non-current assets.
2024
£m
Non-current assets
Chile
590
Rest of the world
1,447
Group
2,037
APAC
Europe &
Africa
Americas
Total
2024
£m
£m
£m
£m
Segment assets and liabilities
Segment assets
833
742
1,206
2,781
Segment liabilities
(1,014)
(761)
(855)
(2,630)
Other assets
2,856
Other liabilities
(1,533)
Total net assets
1,474
Segment assets and liabilities represent the Group’s assets and liabilities that are regularly
reviewed by the chief operating decision maker. They comprise of inventory, receivables,
payables and derivative assets and liabilities that hedge trade payables.
APAC
Europe &
Africa
Americas
Total
2024 from continuing operations
£m
£m
£m
£m
Other segment items
Capital expenditure:
– Property, plant and equipment
28
11
21
60
– Leased vehicles, rental machinery and equipment
23
3
12
38
– Right-of-use assets
17
12
10
39
– Intangible assets
1
1
1
3
Depreciation and impairment
– Property, plant and equipment
16
8
18
42
– Leased vehicles, rental machinery and equipment
6
—
12
18
– Right-of-use assets
33
10
31
74
Amortisation of intangible assets
2
1
6
9
Derecognition of distribution agreements
—
—
5
5
Impairment reversal of distribution agreements
—
—
(19)
(19)
Impairment of right of use assets
1
—
—
1
Net provisions charged/(credited) to the
consolidated income statement
23
(6)
(4)
13
Net provisions include inventory, trade receivables impairment and other liability provisions.
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1 Segmental analysis continued
APAC
Europe &
Africa
Americas
Total
2023
£m
£m
£m
£m
Revenue
Total revenue
2,827
2,809
3,746
9,382
Adjusted operating profit from continuing operations
229
135
256
620
Operating adjusting items
(50)
Operating profit from continuing operations
570
Share of losses after tax of joint ventures and
associates
1
Profit before finance and tax
571
Finance income
51
Finance costs
(244)
Profit before tax from continuing operations
378
Tax
(130)
Profit for the year from continuing operations
248
The Group’s reported segments are based on the location of the Group’s assets. Revenue
earned from sales is disclosed by origin and is not materially different from revenue by
destination. Chile and Australia are presented separately as these comprise more than 10% of
the Group’s revenue. Revenue is further analysed as follows:
2023
£m
Revenue
Chile
1,773
Australia
1,310
Rest of the world
6,299
Group
9,382
The Group’s non-current assets by location comprise intangible assets, property, plant and
equipment, right-of-use assets, joint ventures and associates, and are analysed as shown in the
table below.
2023
£m
Non-current assets
UK
297
Rest of the world
2,252
Group
2,549
APAC
Europe &
Africa
Americas
Total
2023
£m
£m
£m
£m
Segment assets and liabilities
Segment assets
914
854
1,409
3,177
Segment liabilities
(1,171)
(805)
(766)
(2,742)
Other assets
3,210
Other liabilities
(2,249)
Net assets from continuing operations
1,396
Net assets from discontinued operations
224
Total net assets
1,620
Segment assets and liabilities represent the Group’s assets and liabilities that are regularly
reviewed by the chief operating decision maker. They comprise of inventory, receivables,
payables and derivative assets and liabilities that hedge trade payables.
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1 Segmental analysis continued
APAC
Europe &
Africa
Americas
Total
2023 from continuing operations
£m
£m
£m
£m
Other segment items
Capital expenditure:
– Property, plant and equipment
27
13
27
67
– Leased vehicles, rental machinery and equipment
20
26
15
61
– Right-of-use assets
12
8
14
34
– Intangible assets
1
1
2
4
Depreciation and impairment
– Property, plant and equipment
11
7
20
38
– Leased vehicles, rental machinery and equipment
6
1
13
20
– Right-of-use assets
30
10
35
75
Amortisation of intangible assets
2
1
7
10
Net provisions charged to the consolidated income
statement
8
8
31
47
Net provisions include inventory, trade receivables, impairment and other liability provisions.
2 Adjusting items
2024
2023
From continuing operations
£m
£m
Acquisition and integration costs
(42)
(50)
Gain on disposal of business (see note 28)
6
—
Impairment reversal of distribution agreements (see note 10)
19
—
Derecognition of distribution agreements (see note 10)
(5)
—
Total adjusting items in operating profit
(22)
(50)
Adjusting items in finance costs:
Net monetary loss on hyperinflation
(8)
(29)
Interest on dividend payments to former shareholders of Derco
—
(10)
Total adjusting items before tax
(30)
(89)
Tax on adjusting items (see note 7)
10
10
Total adjusting items
(20)
(79)
During the year, operating costs of £42m (2023: £50m) were incurred in connection with the
acquisition and integration of businesses. These costs have been reported as adjusting items to
better reflect the underlying performance of the business. These primarily relate to the
acquisition and integration of the Derco group and the businesses acquired in Indonesia, the
Philippines and New Zealand. The integration of the Derco group is a multi-year programme
that is expected to complete in 2025.
Impairment reversal during the year of £19m (2023: £nil) relates to the Central America - Suzuki
CGU and derecognition of intangibles of £5m (2023: £nil) relates to a distribution agreement in
Bolivia (see note 10).
In December 2024, the Group sold its share in its non-genuine spare parts business in Chile. The
reported gain of £6m (2023: £nil) includes disposal costs and a gain relating to the recycling of
cumulative exchange differences previously recognised in other comprehensive income
(see note 28).
The Group financial statements include adjustments for hyperinflation, following the application
of IAS 29 Financial Reporting in Hyperinflationary Economies in relation to the Group’s
operations with a functional currency of Ethiopian Birr. The results and financial position of
Ethiopia for the year ended 31 December 2024 have been restated to include the effect of
indexation and the resulting £8m net monetary loss on hyperinflation (2023: net monetary loss of
£29m) has been recognised within net finance costs and reported as an adjusting item.
At 31 December 2022, a liability was acquired, as part of the Derco acquisition, for the
payment of a pre-completion dividend to former shareholders. The payment of this dividend
was agreed to be made in four tranches, throughout 2023,with interest accruing on the
outstanding amounts. At 30 June 2023, three of the tranches had been paid and interest of
£10m had been recognised. This interest expense was recognised within finance costs and
reported as an adjusting item.
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3 Revenue and expenses
a) Revenue
An analysis of the Group’s revenue for the year is as follows:
2024
2023
From continuing operations
£m
£m
Sale of goods
8,840
8,971
Provision of services
423
411
9,263
9,382
Sale of goods includes the sale of new and used vehicles and the sale of parts where they are
sold directly to the customer. Provision of services includes financial services, as well as labour
and parts provided in servicing vehicles.
b) Analysis of net operating expenses
Net
operating
expenses
before
adjusting
items
Adjusting
items
Net
operating
expenses
Net
operating
expenses
before
adjusting
items
Adjusting
items
Net operating
expenses
2024
2024
2024
2023
2023
2023
From continuing operations
£m
£m
£m
£m
£m
£m
Distribution costs
516
—
516
524
—
524
Administrative expenses
511
42
553
538
50
588
Other operating (income)/
expenses
(5)
(20)
(25)
(22)
—
(22)
1,022
22
1,044
1,040
50
1,090
c) Profit/(loss) before tax is stated after the following charges/(credits):
2024
2023
From continuing operations
£m
£m
Depreciation and impairment of tangible fixed assets:
– Property, plant and equipment
42
38
– Leased vehicles, rental machinery and equipment
18
20
– Right-of-use assets
74
75
Amortisation of intangible assets
9
10
Impairment of trade receivables
1
7
Profit on sale of property, plant and equipment and intangibles
(1)
(16)
Profit on the sale of property, plant and equipment in 2024 mainly relates to the sale of surplus
assets in APAC (2023: profit on sale of property, plant and equipment of surplus assets in APAC).
d) Auditor’s remuneration
During the year the Group (including its overseas subsidiaries) obtained the following services
from the Group’s auditor at costs as detailed below:
2024
2023
£m
£m
Fees payable to the Company’s auditor and its associates for the audit of
the parent company and the consolidated financial statements
2
3
Fees payable to the Company’s auditor and its associates for other
services:
– The audit of the Company’s subsidiaries
5
4
Total fees payable to the Company’s auditor
7
7
During the year, the Group incurred fees of £0.3m (2023: £0.4m) with the Group’s auditor for
audit-related assurance services.
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3 Revenue and expenses continued
e) Staff costs
2024
2023
From continuing operations
£m
£m
(represented)1
Wages and salaries
531
556
Social security costs
47
43
Other pension costs (see note 5)
9
10
Share-based payment charge (see note 4)
18
15
605
624
1. Refer to presentation of comparative amounts in the accounting policies note.
Other pension costs correspond to the current and past service cost and contributions to the
defined contribution schemes (see note 5).
Information on Directors’ emoluments and interests which forms part of these audited
consolidated financial statements is given in the Directors’ Report on Remuneration which can
be found on pages 91 to 106 of this report. Information on compensation of key management
personnel is set out in note 31b.
f) Average monthly number of employees
Total
2024
2023
From continuing operations
Number
Number
APAC
4,492
3,815
Europe & Africa1
3,493
3,407
Americas
7,821
8,549
Total Distribution
15,806
15,771
Central & Digital
1,606
1,379
17,412
17,150
1. Includes employee numbers for the Group’s remaining retail operation in Europe.
4 Share based payments
The terms and conditions of the Group’s share-based payment plans are detailed in the
Directors’ Report on Remuneration.
The charge arising from awards granted under share-based payment plans was £18m
(2023: £15m), all of which was equity-settled.
The Other Share Plan’s disclosures below include other share-based incentive plans for senior
executives and employees.
The following table sets out the movements in the number of share options and awards during
the year:
2024
Weighted
average
exercise price*
Performance
Share Plan
Save As You
Earn Plan
Other
Share Plans
Outstanding at 1 January
£5.78
5,497,087
1,847,522
1,599,836
Granted
£6.80
2,721,055
45,870
766,410
Exercised
£5.15
(1,508,833)
(663,789)
(609,993)
Lapsed
£6.11
(953,915)
(910,717)
(172,962)
Outstanding at 31 December
£6.29
5,755,394
318,886
1,583,291
Exercisable at 31 December
£6.27
609,811
199,952
62,033
2023
Weighted
average
exercise price*
Performance
Share Plan
Save As You
Earn Plan
Other
Share Plans
Outstanding at 1 January
£4.92 5,107,941 2,056,778 1,370,709
Granted
£6.11 2,237,809
923,833
705,070
Exercised
£3.81
(979,410)
(786,587)
(353,282)
Lapsed
£6.05
(869,253)
(346,502)
(122,661)
Outstanding at 31 December
£5.78 5,497,087 1,847,522 1,599,836
Exercisable at 31 December
£3.77
245,726
322,449
95,835
* The weighted average exercise price excludes nil cost awards made under the Performance Share Plan
and Other Share Plans.
The weighted average share price at the date of exercise of options exercised during the year ended
31 December 2024 was £8.12 (2023: £7.76).
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4 Share based payments continued
The weighted average remaining contractual life for the awards outstanding at 31 December
2024 is 1.2 years (2023: 1.4 years).
The range of exercise prices for options outstanding at the end of the year was £6.00 to £7.31
(2023: £3.77 to £7.31). See note 24 for further details.
The fair value of options granted under the Save As You Earn Plan and Other Share Plans is
estimated as at the date of grant using a Black-Scholes option pricing model, taking into
account the terms and conditions upon which the options were granted. The fair value of nil
cost awards granted under the Performance Share Plan and Other Share Plans is the market
value of the related shares at the time of grant. The following table lists the main inputs to the
model for awards granted during the years ended 31 December 2024 and 31 December 2023:
Performance Share Plan
Save As You Earn Plan
Other Share Plans
2024
2023
2024
2023
2024
2023
Weighted average share price at
grant date
£7.25
£7.53
£8.49
£7.64
£7.30
£7.54
Weighted average exercise price*
n/a
n/a
£6.80
£6.11
n/a
n/a
Vesting period
3.0
years
3.0
years
3.0
years
3.0
years
2.3
years
2.3
years
Expected volatility
n/a
n/a
29.2 %
31.0 %
n/a
n/a
Expected life of award
3.0
years
3.0
years
3.3
years
3.2
years
2.3
years
2.3
years
Weighted average risk-free rate
n/a
n/a
3.7 %
4.5 %
n/a
n/a
Expected dividend yield
n/a
n/a
4.2 %
4.3 %
n/a
n/a
Weighted average fair value per
option
£7.25
£7.53
£1.95
£2.06
£7.30
£7.54
* The weighted average exercise price excludes nil cost awards made under the Performance Share Plan
and Other Share Plans.
No options were granted under the Executive Share Option Plan in 2024 or 2023.
The expected life and volatility of the options are based upon historical data.
5 Pension and other post retirement benefits
The Group operates a number of pension and post-retirement benefit schemes for its
employees in a number of its businesses, primarily in the UK.
a) UK schemes: benefits, governance, cash flow obligations and investments
The Inchcape Motors Pension Scheme (IMPS) in the UK is the Group’s main defined benefit
pension scheme.
The Group also operates the Inchcape Overseas Pension Scheme which is non-UK registered.
Benefit structure
IMPS, which provides benefits linked to the final salary of members, is closed to new members
and closed to future benefit accrual. Final salary schemes provide benefits to members in the
form of a guaranteed level of pension payable for life. The level of benefits provided depends
on final salary at retirement (or leaving date, if earlier) and length of service. The Group bears
risks in relation to its final salary schemes, notably relating to investment performance, interest
rates, inflation, and members’ life expectancies. There is potential for these risks to harm the
funding position of the schemes. If the schemes were to be in deficit, then additional
contributions may be required from the Group. A number of exercises have been undertaken
to mitigate these key funding risks.
IMPS also includes a defined benefit cash balance scheme. Cash balance schemes allow
members to accrue a percentage of their earnings each year which then grows to provide a
lump sum payment on retirement. Members accrued benefits under this scheme with effect
from 1 January 2013 up to 31 December 2020. The Group underwrites the investment and
interest rate risk to normal retirement age (65). Inflation and mortality risks associated with
benefits are borne solely by the members. Following a consultation process with relevant
employees this section closed to future benefit accrual on 31 December 2020.
From 1 January 2021, UK employees were offered membership of the Inchcape Retirement
Savings Plan, a defined contribution workplace personal pension scheme, which is designed to
comply with auto enrolment legislation. Defined contribution schemes like the Inchcape
Retirement Savings Plan, see members’ individual accounts credited with employee and
employer contributions which are then invested to provide a pension pot on retirement. The
Group does not underwrite investment, or other risks for this plan.
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5 Pension and other post retirement benefits continued
Governance
Our UK schemes are registered with HM Revenue and Customs (HMRC) and comply fully with
the regulatory framework published by the UK Pensions Regulator.
IMPS is established under trust law and has a trustee board that runs the scheme in
accordance with the Trust Deed and Rules and relevant legislation. The trustee board
comprises an independent sole trustee company appointed by the Group. As part of good
governance, the Group reviewed the provision of trustee services to IMPS and after a formal
tender process it was decided to move to a Sole Trustee model from June 2021. The Trustee is
required to act in the best interest of the members and have responsibility for the scheme’s
governance. The Trustee consults with the Group over decisions relating to matters such as
funding and investments.
The Inchcape Retirement Savings Plan has an external pension provider with its own
governance committee.
The Group also has some minor unfunded arrangements relating to post-retirement health and
medical plans in respect of past employees.
Scheme specific cash obligation and investment detail
Inchcape Motors Pension Scheme
The Group considers two measures of the pension deficit. The accounting position is shown on
the Group’s balance sheet. The funding position, calculated at the triennial actuarial valuation,
is used to agree contributions made to IMPS. The last completed actuarial valuations for IMPS
was carried out as at 5 April 2022 on a market-related basis.
The value of accrued liabilities determined in accordance with the advice of the Scheme
Actuary was based on the defined accrued benefit method. The actuarial valuation
determined that the duration of the liabilities was approximately 14 years and that an
aggregate surplus of £40m existed. As a consequence, the Group and the Trustee agreed that
contributions to IMPS would cease with effect from April 2022.
In November 2024, the Trustee of IMPS completed a buy-in transaction whereby the assets of
the scheme were used to acquire a bulk purchase annuity policy under which the benefits
payable to the members of the scheme are now fully insured. The insurance policy was
purchased using the existing assets of the scheme with no additional funding required from the
Group. As at 31 December 2024, the bulk purchase annuity policy has been accounted for as
an asset of the scheme and valued on the same basis as the liabilities that it matches as the
legal responsibility to pay benefits remains with the Trustee. As at 31 December 2024, IMPS had
an IAS 19 accounting surplus of £36m.
The Group is aware of a case involving Virgin Media Limited and NTL Pension Trustees II Limited
relating to the validity of certain historical pension changes which could potentially lead to
additional liabilities for some pension schemes and sponsors although there is uncertainty as to
how the ruling would be applied in practice. The Group has undertaken an initial risk-based
assessment of any potential impact on IMPS and the Group. The assessment has, to date, not
identified any matters that may give rise to an additional liability. Management will continue to
monitor developments in this regard and the implications, if any, for IMPS.
Inchcape Overseas Pension Scheme (closed section)
This scheme is managed from Guernsey and is subject to regulations similar to the UK. It is
therefore reported under the United Kingdom in this note. The latest triennial actuarial valuation
for this scheme was carried out at 31 March 2021 and based on the defined accrued benefit
method. The actuarial valuation determined that the duration of the liabilities was
approximately 12 years and that the scheme was approximately 80% funded on a prudent
funding basis. To make good the funding deficit of £13m, it was agreed that deficit
contributions of £1.5m p.a. would be paid by means of an annual lump sum, ending with the
payment due in July 2028. The first payment at this new level was paid on 1 July 2020.
Additional contributions in respect of expenses of £0.2m per annum are also made. In July
2024, in light of improvements to the funding position based on work undertaken at the end of
2023, it was agreed with the Trustee that the Group would pay £1m of the agreed deficit
contributions in July 2024, with the remaining £0.5m being deferred and contingent on the
results of the 31 March 2024 valuation.
b) Overseas schemes
There are a number of smaller defined benefit schemes overseas, the significant schemes
being the Inchcape Motors Limited Retirement Scheme in Hong Kong and the acquired
defined benefit scheme in Indonesia. In general, these schemes offer a lump sum on retirement
with no further obligation to the employee and assets are held in trust in separately
administered funds. These schemes are typically subject to triennial valuations. The overseas
defined contribution schemes are principally linked to local statutory arrangements.
c) Defined contribution plans
The total expense (from continuing operations) recognised in the consolidated income
statement is £9m (2023: £10m). There are no outstanding contributions at 31 December 2024
(2023: £nil).
d) Defined benefit plans
As the Group’s principal defined benefit schemes are in the UK, these have been reported
separately from the overseas schemes. For the purposes of reporting, actuarial updates have
been obtained for the Group’s material schemes and these updates are reflected in the
amounts reported in the following tables.
e) Recognition of Pension Surplus ‘IFRIC 14’
The Group is not required to recognise any additional liabilities in relation to funding plans, or
limit the recognition of any surpluses, as the Group retains an unconditional right to any future
economic benefits available by way of future refunds or reduction in contributions.
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5 Pension and other post retirement benefits continued
The principal weighted average assumptions used by the actuaries were:
United Kingdom
Overseas
2024
2023
2024
2023
%
%
%
%
Rate of increase in salaries
n/a
n/a
4.0
3.4
Rate of increase in pensions
2.7
2.6
3.1
3.7
Discount rate
5.4
4.5
4.3
3.1
Rate of inflation:
– Retail price index
3.3
3.2
2.0
2.0
– Consumer price index
2.8
2.6
n/a
n/a
Assumptions regarding future mortality experience are set based on published statistics and
experience. For the UK schemes, the average life expectancy of a pensioner retiring at age 65
is 21.7 years (2023: 21.5 years) for current pensioners and 23.0 years (2023: 22.8 years) for current
non pensioners. Most of the overseas schemes only offer a lump sum on retirement and
therefore mortality assumptions are not applicable.
The asset/(liability) recognised in the consolidated statement of financial position is determined
as follows:
United Kingdom
Overseas
Total
2024
2023
2024
2023
2024
2023
£m
£m
£m
£m
£m
£m
Present value of funded
obligations
(517) (576)
(33)
(31) (550) (607)
Fair value of plan assets
550
655
30
30
580
685
Net surplus/(deficit) in funded
obligations
33
79
(3)
(1)
30
78
Present value of unfunded
obligations
—
—
(7)
(11)
(7)
(11)
33
79
(10)
(12)
23
67
The net pension asset is analysed
as follows:
Schemes in surplus
36
84
—
—
36
84
Schemes in deficit
(3)
(5)
(10)
(12)
(13)
(17)
33
79
(10)
(12)
23
67
The amounts recognised in the consolidated income statement are as follows:
United Kingdom
Overseas
Total
2024
2023
2024
2023
2024
2023
£m
£m
£m
£m
£m
£m
Current service cost
—
—
(3)
(2)
(3)
(2)
Scheme expenses
(1)
(1)
—
—
(1)
(1)
Interest expense on plan liabilities
(25)
(27)
(1)
(1)
(26)
(28)
Interest income on plan assets
28
31
1
1
29
32
2
3
(3)
(2)
(1)
1
The amounts recognised in the consolidated statement of comprehensive income are as
follows:
United Kingdom
Overseas
Total
2024
2023
2024
2023
2024
2023
£m
£m
£m
£m
£m
£m
Actuarial (losses)/gains on
liabilities:
– Experience gains/(losses)
1
(6)
—
1
1
(5)
– Changes in demographic
assumptions
(3)
22
—
—
(3)
22
– Changes in financial
assumptions
53
(23)
2
1
55
(22)
Actuarial (losses)/gains on assets:
– Experience (losses)/gains
(100)
(15)
1
—
(99)
(15)
(49)
(22)
3
2
(46)
(20)
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5 Pension and other post retirement benefits continued
Analysis of the movement in the net asset/(liability):
United Kingdom
Overseas
Total
2024
2023
2024
2023
2024
2023
£m
£m
£m
£m
£m
£m
At 1 January
79
96
(12)
(3)
67
93
Business acquisitions (note 28(a))
—
—
—
(11)
—
(11)
Amount recognised in the
consolidated income statement
2
3
(3)
(2)
(1)
1
Contributions by employer
1
2
2
1
3
3
Actuarial (losses)/gains recognised
in the year
(49)
(22)
3
2
(46)
(20)
Effect of foreign exchange rates
—
—
—
1
—
1
At 31 December
33
79
(10)
(12)
23
67
Changes in the present value of the defined benefit obligation are as follows:
United Kingdom
Overseas
Total
2024
2023
2024
2023
2024
2023
£m
£m
£m
£m
£m
£m
At 1 January
(576) (572)
(42)
(36) (618) (608)
Business acquisitions (note 28(a))
—
—
—
(11)
—
(11)
Current service cost
—
—
(3)
(2)
(3)
(2)
Interest expense on plan liabilities
(25)
(27)
(1)
(1)
(26)
(28)
Actuarial (losses)/gains:
– Experience (losses)/gains
1
(6)
—
1
1
(5)
– Changes in demographic
assumptions
(3)
22
—
—
(3)
22
– Changes in financial
assumptions
53
(23)
2
1
55
(22)
Benefits paid
33
30
5
3
38
33
Effect of foreign exchange rate
changes
—
—
(1)
3
(1)
3
At 31 December
(517) (576)
(40)
(42) (557) (618)
Changes in the fair value of the defined benefit asset are as follows:
United Kingdom
Overseas
Total
2024
2023
2024
2023
2024
2023
£m
£m
£m
£m
£m
£m
At 1 January
655
668
30
33
685
701
Interest income on plan assets
28
31
1
1
29
32
Scheme expenses
(1)
(1)
—
—
(1)
(1)
Actuarial (losses)/gains:
– Experience (losses)/gains
(100)
(15)
1
—
(99)
(15)
Contributions by employer
1
2
2
1
3
3
Benefits paid
(33)
(30)
(5)
(3)
(38)
(33)
Effect of foreign exchange rate
changes
—
—
1
(2)
1
(2)
At 31 December
550
655
30
30
580
685
At the end of the reporting period, the percentages of the plan assets by category were as
follows:
United Kingdom
Overseas
Total
2024
2023
2024
2023
2024
2023
Equities
—
5.2 %
53.4 %
50.0 %
2.8 %
7.2 %
Bonds
—
32.1 %
43.3 %
43.3 %
2.2 %
32.6 %
Liability driven investment
7.1 %
55.6 %
—
—
6.7 %
53.1 %
Bulk purchase annuity
85.4 %
—
—
—
81.0 %
—
Long lease property
—
7.1 %
—
—
—
6.9 %
Other
7.5 %
—
3.3 %
6.7 %
7.3 %
0.2 %
100.0 %
100.0 %
100.0 % 100.0 %
100.0 % 100.0 %
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5 Pension and other post retirement benefits continued
The majority of investments shown as equities and bonds are held through funds where the
underlying investments of the fund are quoted. Liability driven investment is a strategy
commonly used by defined benefit pension schemes to reduce interest rate and inflation risk. It
includes government bonds, derivative instruments, and cash. Virtually all the equities and
bonds held within the investment funds have prices in active markets. Derivatives, property,
and liability driven investment can be classified as level 2 instruments. The schemes had no
directly held employer related investment during the reporting period.
The schemes’ investment managers may potentially hold a small investment in Inchcape plc
either through index weightings or stock selection (less than 0.5% of their respective
fund values).
The following disclosures relate to the Group’s defined benefit plans only.
f) Risk management
Asset volatility
Scheme liabilities are calculated on a discounted basis using a discount rate which is set with
reference to corporate bond yields. If scheme assets underperform this yield, then this will
create a deficit.
Inflation risk
The majority of the Group’s defined benefit obligations are linked to inflation. Higher inflation
will lead to higher liabilities, although in the majority of cases there are caps on the level of
inflationary increases to be applied to pension obligations.
Life expectancy
Where relevant, the plans’ obligations are to provide a pension for the life of the member, so
increases in life expectancy will result in an increase in the plans’ benefit payments. Future
mortality rates cannot be predicted with certainty. All of the schemes conduct scheme-
specific mortality investigations annually, to ensure the Group has a clear understanding of any
potential increase in liability due to pensioners living for longer than assumed.
Risk mitigation
The investment by the IMPS Trustee in a bulk purchase annuity has removed investment,
inflation and mortality risks for approximately 85% of liabilities and 80% of assets. The remaining
risks are mitigated through liability driven investment strategies with investment in defensive and
inflation-linked assets (liability driven investment solutions, absolute return bonds, government
bonds, derivative instruments and cash).
g) Sensitivity analysis
The disclosures above are dependent on the assumptions used. The table below demonstrates
the sensitivity of the defined benefit obligation to changes in the assumptions used for the UK
schemes. Changes in assumptions have an immaterial effect on the overseas schemes.
Impact on the defined benefit obligation
United Kingdom
2024
2023
£m
£m
Discount rate -1%
+61
+75
Discount rate +1%
-50
-61
CPI Inflation -0.25%
-7
-9
CPI Inflation +0.25%
+7
+9
Life expectancy +1 year
+20
+23
The above analysis is based on a change in an assumption while holding all other assumptions
constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be
correlated. The above variances have been used as they are believed to be reasonably
possible changes in assumptions by reference to recent trends and experiences.
h) Expected future cash flows
The Group paid approximately £1m (2023: £2m) to its UK defined benefit plans in 2024 under
the prevailing Schedules of Contributions (following the 5 April 2022 actuarial valuations for the
Inchcape Motors Pension Scheme and 31 March 2021 valuation for the Inchcape Overseas
Pension Scheme).
From 1 January 2021 (following the closure of the defined benefit cash balance scheme to
future benefit accrual on 31 December 2020) the Group pays ongoing employer pension
contributions into the Inchcape Retirement Savings Plan (a defined contribution plan).
The defined benefit obligations are based on the current value of expected benefit payment
cash flows to members over the next several decades. The average duration of the liabilities is
approximately 13 years for the UK schemes.
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6 Net finance costs
2024
2023
From continuing operations
£m
£m
Interest expense on bank and other borrowings
122
124
Finance costs on lease liabilities (note 12(b))
19
19
Interest on inventory financing
56
38
Net monetary loss on hyperinflation (note 2)
8
29
Interest on deferred dividend payment
—
10
Other finance costs
16
24
Finance costs
221
244
Bank and other interest receivable
(64)
(46)
Net interest income on post-retirement plan assets and liabilities
(3)
(4)
Other finance income
(4)
(1)
Finance income
(71)
(51)
Net finance costs
150
193
Analysed as:
Net finance costs excluding adjusting finance costs
142
154
Finance costs reported as adjusting items
8
39
Net finance costs
150
193
Other finance costs include fees, commissions and foreign exchange gains and losses.
Since 2022, in accordance with IAS 29 Financial Reporting in Hyperinflationary Economies, the
results and financial position of the Group’s operations in Ethiopia have been restated to the
purchasing power or inflationary measuring unit current at the end of the reporting period.
Therefore, finance costs include the loss on hyperinflation in respect of monetary items, which is
also treated as an adjusting item.
7 Tax
This note only provides information about corporate income taxes under IFRS . The Group has
subsidiaries in over 40 territories across the world. The Group pays and collects many different
taxes in addition to corporate income taxes including: payroll taxes, value added and sales
taxes, property taxes, product-specific taxes and environmental taxes. Such taxes borne by the
Group are included in profit before tax.
2024
2023
From continuing operations
£m
£m
Current tax
– United Kingdom tax
—
—
– Overseas tax
131
146
– Pillar 2 income taxes
2
—
Adjustments to prior year liabilities
– United Kingdom tax
(3)
—
– Overseas tax
(3)
(6)
Current tax
127
140
Deferred tax
2
(10)
Total tax charge
129
130
– Tax charge on profit before
adjusting items
139
140
– Tax credit on adjusting items
(10)
(10)
Total tax charge
129
130
Details of the adjusting items for the year can be found in note 2. Not all of the adjusting items
will be taxable or deductible for tax purposes. Therefore, the tax credit on adjusting items
represents the total of the current and deferred tax on only those elements that are assessed
as taxable or deductible. In the current year, the tax credit on adjusting items includes the
local tax effect of the disposal of the non-genuine spare parts business in Chile (see note 28a).
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7 Tax continued
a) Factors affecting the tax expense for the year
The effective tax rate for the year is 31.2% (2023: 34.4%). The effective tax rate on adjusted
profit before tax is 31.3% (2023: 30.0%). The weighted average tax rate is 23.0% (2023: 22.4%).
The weighted average tax rate comprises the average statutory rates across the Group,
weighted in proportion to accounting profits and losses before tax.
The Group is within the scope of Pillar Two with effect from 1 January 2024 under UK legislation.
Pillar Two legislation has also been enacted in other jurisdictions where Inchcape operate and
may affect computation of top-up taxes for those markets. Under the legislation, the Group is
liable to pay a top-up tax for the difference between its Pillar Two effective tax rate per
jurisdiction and the 15% minimum rate. Included within the current tax charge for the year is a
Pillar Two income tax charge of £2m, payable by June 2026. The main jurisdictions in which
exposure to this tax exists include Bulgaria and Macao.
The Group applies the exception to recognising and disclosing information about deferred tax
assets and liabilities related to Pillar Two income taxes, as provided in the amendments to IAS
12 issued in May 2023.
The table below explains the differences between the expected tax charge at the weighted
average tax rate and the Group’s total tax charge.
2024
2023
From continuing operations
£m
£m
Profit before tax
414
378
Profit before tax multiplied by the weighted average tax rate of 23.0%
(2023: 22.4%)
95
85
– Permanent differences
8
4
– Non-taxable income
(4)
(4)
– Prior year items
2
(4)
– Derecognition/(recognition) of deferred tax assets
21
35
– Overseas tax audits and settlements
2
1
– Taxes on undistributed earnings
1
2
– Acquisition and integration costs
3
2
– Net monetary loss on hyperinflation
3
9
– Pillar Two income taxes
2
—
– Disposal of businesses
(6)
—
– Tax rate changes
2
—
Total tax charge
129
130
b) Factors affecting the tax expense of future years
The Group’s future tax charge, and effective tax rate, could be affected by several factors
including; the resolution of audits and disputes, changes in tax laws or tax rates, repatriation of
cash from overseas markets to the UK, the ability to utilise brought forward losses and business
acquisitions and disposals. In addition, a change in profit mix between low and high taxed
jurisdictions will impact the Group’s future tax charge.
The utilisation of brought forward tax losses or the recognition of deferred tax assets associated
with such losses may also give rise to tax charges or credits. The recognition of deferred tax
assets, particularly in respect of tax losses, is based upon an assessment of whether it is
probable that there will be sufficient and suitable taxable profits in the relevant legal entity or
tax group against which to utilise the assets in the future. Judgement is required when
determining probable future taxable profits. In the event that actual taxable profits are
different to those forecast, the Group’s future tax charge and effective tax rate could be
affected. Information about the Group’s tax losses and deferred tax assets can be found in
note 16.
The Group has published its approach to tax on www.inchcape.com covering its tax strategy
and governance framework in accordance with Schedule 19 Finance Act 2016.
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8 Earnings per share
2024
2023
£m
£m
Profit for the period
435
283
Non-controlling interests
(14)
(13)
Basic earnings
421
270
Profit for the year from discontinued operations
(150)
(35)
Basic earnings from continuing operations attributable to owners of the
parent
271
235
Adjusting items
20
79
Adjusted earnings from continuing operations attributable to owners of the
parent
291
314
Basic earnings per share
Basic earnings per share from continuing operations
66.4p
57.1p
Basic earnings per share from discontinued operations
36.7p
8.5p
Total basic earnings per share
103.1p
65.6p
Diluted earnings per share
Diluted earnings per share from continuing operations
65.6p
56.4p
Diluted earnings per share from discontinued operations
36.3p
8.4p
Total diluted earnings per share
101.9p
64.8p
Adjusted earnings per share from continuing operations
Basic Adjusted earnings per share from continuing operations
71.3p
76.3p
Diluted Adjusted earnings per share from continuing operations
70.4p
75.3p
2024
2023
number
number
Weighted average number of fully paid ordinary shares in issue
during the period
409,082,913 412,689,716
Weighted average number of fully paid ordinary shares in issue
during the period:
– Held by the Inchcape Employee Trust
(794,779) (1,131,983)
Weighted average number of fully paid ordinary shares for the
purposes of basic EPS
408,288,134 411,557,733
Dilutive effect of potential ordinary shares
4,816,968 5,408,280
Adjusted weighted average number of fully paid ordinary shares in
issue during the period for the purposes of diluted EPS
413,105,102 416,966,013
Basic earnings/(loss) per share is calculated by dividing the Basic earnings/(loss) for the year by
the weighted average number of fully paid ordinary shares in issue during the year, less those
shares held by the Inchcape Employee Trust.
Diluted earnings/(loss) per share is calculated on the same basis as Basic earnings/(loss) per
share with a further adjustment to the weighted average number of fully paid ordinary shares
to reflect the effect of all dilutive potential ordinary shares. Dilutive potential ordinary shares
comprise share options and other share-based awards.
Basic Adjusted earnings (which excludes adjusting items) is adopted to assist the reader in
providing an additional performance measure of the Group. Basic Adjusted earnings per share
is calculated by dividing the Adjusted earnings for the year by the weighted average number
of fully paid ordinary shares in issue during the year, less those shares held by the Inchcape
Employee Trust.
Diluted Adjusted earnings per share is calculated on the same basis as the Basic Adjusted
earnings per share with a further adjustment to the weighted average number of fully paid
ordinary shares to reflect the effect of all dilutive potential ordinary shares. Information
presented for diluted and diluted adjusted earnings per ordinary share uses the weighted
average number of shares as adjusted for potentially dilutive ordinary shares as
the denominator.
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9 Dividends
The following dividends were paid by the Group:
2024
2023
£m
£m
Final dividend for the year ended 31 December 2023 of 24.3p per share
(2022: 21.3p per share)
100
88
Interim dividend for the six months ended 30 June 2024 of 11.3p per share
(30 June 2023: 9.6p per share)
47
40
147
128
A final proposed dividend for the year ended 31 December 2024 of 17.2p per share is subject
to approval by shareholders at the Annual General Meeting and has not been included as a
liability as at 31 December 2024. The Group has sufficient distributable reserves to pay
dividends to its ultimate shareholders. Distributable reserves are calculated on an individual
legal entity basis and the ultimate parent company, Inchcape plc, currently has adequate
levels of realised profits within its retained earnings to support dividend payments.
At 31 December 2024, Inchcape plc’s company-only distributable reserves were £513m. On an
annual basis, the distributable reserve levels of the Group’s subsidiary undertakings are
reviewed and dividends paid up to Inchcape plc where it is appropriate to do so.
10 Intangible assets
Goodwill
Indefinite-life
intangible
assets¹
Computer
software &
Other²
Total
Cost
£m
£m
£m
£m
At 1 January 2023
648
878
132
1,658
Businesses acquired
39
113
—
152
Acquisition adjustments
5
—
—
5
Additions
—
—
5
5
Effect of foreign exchange rate changes
(15)
(43)
(3)
(61)
At 1 January 2024
677
948
134
1,759
Acquisition adjustments (note 28b)
(1)
—
—
(1)
Businesses sold (note 28a)
(272)
—
(36)
(308)
Additions
—
—
3
3
Disposals
—
—
(1)
(1)
Derecognition
—
(5)
—
(5)
Retirements
—
—
(12)
(12)
Effect of foreign exchange rate changes
(29)
(91)
—
(120)
At 31 December 2024
375
852
88
1,315
Accumulated amortisation and impairment
At 31 December 2023
(378)
(20)
(86)
(484)
Amortisation charge for the year
—
—
(11)
(11)
Effect of foreign exchange rate changes
3
1
3
7
At 1 January 2024
(375)
(19)
(94)
(488)
Amortisation charge for the year (note 3)
—
—
(9)
(9)
Businesses sold (note 28a)
268
—
34
302
Disposals
—
—
1
1
Retirements
—
—
12
12
Impairment (charge)/reversal for the year
—
19
—
19
Effect of foreign exchange rate changes
4
—
—
4
At 31 December 2024
(103)
—
(56)
(159)
Net book value at 31 December 2024
272
852
32
1,156
Net book value at 31 December 2023
302
929
40
1,271
1. Indefinite-life intangible assets comprise distribution agreements and acquired brands for which there is no
foreseeable limit to the period over which they are expected to generate net cash inflows.
2. Included in computer software and other is acquired customer relationships.
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10 Intangible assets continued
Impairment reversals during the year of £19m (2023: £nil) relate to the reversal of previous
impairment charges against the distribution agreement intangible asset attributable to the
Central America - Suzuki CGU. The derecognition of £5m is in respect of a distribution
agreement intangible asset acquired in Bolivia as part of the acquisition of the Derco group of
companies in 2022. At 31 December 2024, computer software under development was £nil
(2023: £4m).
Goodwill and indefinite-life intangible assets
Goodwill acquired in a business combination has been allocated to the cash generating units
(CGUs) or group of CGUs (hereafter collectively referred to as ‘CGU groups’) that are
expected to benefit from the synergies associated with that business combination. The CGUs
for goodwill testing are aligned with the operating segments, Asia, Australasia, Europe, Africa,
and Americas, which represent the CGU groups that are expected to benefit from the
synergies of the business combination in which the goodwill arose and which represent the
lowest level at which information about goodwill is available and monitored for internal
management purposes.
Indefinite-life intangible assets, principally distribution agreements acquired in a business
combination, are also allocated to the CGU groups that are expected to benefit from the cash
flows associated with the relevant agreements.
The carrying amount of goodwill has been allocated to CGU groups representing the following
reporting segments:
2024
2023
Goodwill
£m
£m
Americas
182
207
APAC
75
79
Other
15
16
272
302
The carrying amount of indefinite-life intangible assets has been allocated to CGU groups
within the following geographical areas:
2024
2023
Indefinite-life intangible assets
£m
£m
Europe & Africa
27
28
Americas – Derco
428
506
Americas – Subaru
79
86
Americas – Hino
37
41
Central Americas – Suzuki
90
70
Americas – Other
81
84
APAC
110
114
852
929
In accordance with the Group’s accounting policies, goodwill and other indefinite-life
intangible assets are tested at least annually for impairment and whenever events or
circumstances indicate that the carrying amount may not be recoverable. Impairment tests
were performed for all CGU groups during the year ended 31 December 2024. The recoverable
amounts of all CGU groups were determined based on the higher of the fair value less costs to
sell and value in use calculations.
The recoverable amount is determined firstly through value in use calculations. Where this is
insufficient to cover the carrying value of the relevant asset being tested, fair value less costs to
sell is also determined.
Site-based assets (property, plant and equipment and right-of-use assets) are first tested for
impairment individually before being included in the aforementioned impairment tests as a
component of the carrying value of a CGU group. If the carrying amount of a CGU group
exceeds its recoverable amount, an impairment loss is recognised and allocated between the
assets of the CGU group to reduce the carrying amount. This allocation is initially applied to the
carrying amount of any goodwill allocated to the CGU group. If a further impairment charge
still remains, then this is allocated to other assets in the CGU group on a pro-rata basis.
The value in use calculations mainly use cash flow projections based on three-year financial
projections prepared by management. The key assumptions for these projections are those
relating to volumes, revenue, gross margins, overheads, the level of working capital required to
support trading and capital expenditure.
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10 Intangible assets continued
Forecast revenue is based on past experience and expectations for near-term growth in the
relevant markets. Key assumptions used to determine revenue are expectations of market size,
represented by Total Industry Volume (TIV) and Units in Operation (UIO), estimates of product
availability from mobility partners and market share, based on external sources where
appropriate. Operating profits are forecast based on historical experience of gross and
operating margins, adjusted for the impact of changes to product mix and cost-saving
initiatives that had been implemented at the reporting date. Cash flows are forecast based on
operating profit adjusted for the level of working capital required to support trading and
capital expenditure. The assumptions used in the value in use calculations are based on past
experience, recent trading, and forecasts of operational performance in the relevant markets
including expectations about continuing relationships with key mobility partners.
The impact of climate risks and opportunities are considered during the strategic, operational
and financial planning processes. As part of this, management reviews the climate change
factors that could impact the business plan over the short, medium and long-term and the
scenarios relating to the impacts of climate change including the pace of transition to battery
electric vehicles and how this will impact future operations. Short-term financial forecasts used
for the purpose of testing intangible assets for impairment reflect, where appropriate, short-
term climate risks and opportunities. In the medium to long-term, such risks and opportunities
are factored into the growth rates used for modelling purposes where reasonably quantifiable.
For all CGU groups, cash flows after the three-year period are extrapolated for a further seven
years using declining growth rates which reduces the year three growth rate down to the long-
term growth rate appropriate for each CGU group, to better reflect the medium-term growth
expectations for those markets. A terminal value calculation is used to estimate the cash flows
after year 10 using these long-term growth rates.
Cash flows are discounted back to present value using a discount rate specific to each CGU
group. The discount rates used are calculated using the capital asset pricing model to derive a
cost of equity which is then weighted with an estimated cost of debt and lease liabilities based
on an optimal market gearing structure. The Group uses several inputs to calculate a range for
each discount rate from which an absolute measure is determined for use in the value in use
calculations. Key inputs include benchmark risk-free rates, inflation differentials, equity risk
premium, country risk premium and a risk adjustment (beta) calculated by reference to
comparable companies with similar retail and distribution operations. The Group applies post-
tax discount rates to post-tax cash flows as the valuation calculated using this method closely
approximates to applying pre-tax discount rates to pre-tax cash flows, therefore the equivalent
pre-tax discount rate assumptions have been presented below.
Key assumptions used
Pre-tax discount rates and long-term discount rates used in the value in use calculations for
each of the Group’s significant CGU groups and significant indefinite-life intangible assets are
shown below:
Goodwill:
2024
Americas
Asia
Pre-tax discount rate (%)
11.1
8.8
Long-term growth rate (%)
3.0
2.4
2023
Americas
Asia
Pre-tax discount rate (%)
12.6
9.3
Long-term growth rate (%)
2.8
2.2
Indefinite-life intangible assets:
2024
Americas –
Hino
Central
America –
Suzuki
Derco
Pre-tax discount rate (%)
12.3
11.7
11.0
Long-term growth rate (%)
3.1
3.3
3.0
2023
Americas –
Hino
Central
America –
Suzuki
Derco
Pre-tax discount rate (%)
14.3
12.6
12.5
Long-term growth rate (%)
2.7
2.9
2.9
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10 Intangible assets continued
Central America – Suzuki
At 31 December 2024, the value in use for the Central America – Suzuki CGU group had a
recoverable amount in excess of the carrying value as the forecast assumptions indicated that
the business would continue to improve its profitability and associated cash flows. The Central
America - Suzuki distribution agreement asset had previously been impaired and therefore an
impairment reversal of £19m has been recognised in the year and disclosed as an adjusting
item, consistent with the disclosure of the original impairment charge.
The recoverable value of the Central America - Suzuki CGU group was £167m and, after the
recognition of the impairment reversal, exceeded the carrying value of the CGU group by
£13m (8%). The recoverable value of the CGU group was determined based on value in use
calculations, consistent with the approach used as at 31 December 2023. Cash flows were
discounted back to present value using a pre-tax discount rate of 11.7% (2023: 12.6%).
The cash flows used within the impairment models are based on assumptions which are sources
of estimation uncertainty and small movements in these assumptions could lead to an
impairment. Management have performed sensitivity analysis on the key assumptions in the
indefinite-life intangible asset impairment model for Central America – Suzuki using reasonably
possible changes in these key assumptions. The sensitivities have been selected based on the
inherent business volatility and the metrics that closely align to the consequences of climate
change risks and opportunities detailed on pages 35 to 50.
Increase/
(decrease) in
assumption
Decrease in
value in use
£m
Impact on
carrying value
£m
Revenue CAGR (%)
(1.0) %
(21)
(8)
Average gross margin (%)
(0.5) %
(11)
—
Pre-tax discount rate (%)1
1.0 %
(25)
(12)
Long-term growth rate (%)
(0.5) %
(8)
—
1. The recoverable amount would equal the carrying value if the discount rate was increased by 0.5%
throughout the forecasting period.
Americas - Derco
Following the non-renewal of a distribution agreement acquired as part of the acquisition of
the Derco group of companies in 2022, a distribution agreement asset in Bolivia of £5m has
been derecognised in the current year and disclosed as an adjusting item.
Americas - Hino
The Americas – Hino CGU group includes the Group’s Hino businesses in Chile and Colombia.
The business in Colombia has been affected by the availability of new vehicles to meet local
emissions regulations. As at 31 December 2024, the Americas – Hino CGU group had a carrying
value of £57m (2023: £41m) and the value in use calculations indicated that there was limited
headroom. The cash flows for the Americas – Hino CGU group are sensitive to any change in
assumption, with the timing of resumption of supply being of particular significance to the cash
flow forecasts. Management have performed sensitivity analysis on the key assumptions in the
indefinite-life intangible asset impairment model for Americas - Hino using reasonably possible
changes in key assumptions.
Increase/
(decrease) in
assumption
Decrease in
value in use
£m
Impact on
carrying value
£m
Supply constraint
1 year
(6)
(5)
Average gross margin (%)
(0.5) %
(4)
(3)
Pre-tax discount rate (%)
1.0 %
(8)
(7)
Long-term growth rate (%)
(0.5) %
(2)
(1)
Other CGUs
The Group’s value in use calculations are sensitive to changes in the key assumptions used.
However, a reasonably possible change, based on historical experience, in a key assumption
would not cause a material impairment of indefinite-life intangible assets for any other
CGU group.
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159
11 Property, Plant and Equipment
Land and
buildings
Plant,
machinery
and
equipment
Subtotal
Leased
vehicles,
rental
machinery
and
equipment
Total
Cost
£m
£m
£m
£m
£m
At 1 January 2023
745
299
1,044
88
1,132
Opening balance hyperinflation
adjustment
9
9
18
—
18
Businesses acquired
79
16
95
3
98
Additions
45
43
88
84
172
Disposals
(10)
(8)
(18)
—
(18)
Transferred from/(to) inventory
—
(1)
(1)
(21)
(22)
Other¹
4
(1)
3
1
4
Transferred from/(to) assets held for sale
(6)
(1)
(7)
—
(7)
Effect of foreign exchange rate changes
(24)
(12)
(36)
(4)
(40)
At 1 January 2024
842
344
1,186
151
1,337
Opening balance hyperinflation
adjustment
4
8
12
—
12
Acquisition adjustments (note 28b)
—
(1)
(1)
—
(1)
Businesses sold (note 28a)
(294)
(71)
(365)
(24)
(389)
Additions
49
26
75
38
113
Disposals
(13)
(15)
(28)
—
(28)
Transferred from/(to) inventory
—
3
3
(36)
(33)
Retirement of fully depreciated assets
—
(1)
(1)
—
(1)
Effect of foreign exchange rate changes
(51)
(32)
(83)
(5)
(88)
At 31 December 2024
537
261
798
124
922
Land and
buildings
Plant,
machinery
and
equipment
Subtotal
Leased
vehicles,
rental
machinery
and
equipment
Total
impairment
£m
£m
£m
£m
£m
At 1 January 2023
(191)
(191)
(382)
(13)
(395)
Opening balance hyperinflation
adjustment
(1)
(4)
(5)
—
(5)
Depreciation charge for the year
(22)
(28)
(50)
(20)
(70)
Impairment charge for the year
(9)
(2)
(11)
—
(11)
Disposals
6
6
12
—
12
Transferred to/(from) inventory
—
1
1
10
11
Other¹
(4)
1
(3)
(1)
(4)
Transferred to/(from) assets held for sale
2
1
3
—
3
Effect of foreign exchange rate changes
5
9
14
1
15
At 1 January 2024
(214)
(207)
(421)
(23)
(444)
Opening balance hyperinflation
adjustment
(1)
(3)
(4)
—
(4)
Businesses sold (note 28a)
71
55
126
—
126
Depreciation charge for the year
(17)
(27)
(44)
(18)
(62)
Disposals
6
14
20
—
20
Transferred to/(from) inventory
—
—
—
9
9
Retirement of fully depreciated assets
—
1
1
—
1
Effect of foreign exchange rate changes
11
9
20
1
21
At 31 December 2024
(144)
(158)
(302)
(31)
(333)
Net book value at 31 December 2024
393
103
496
93
589
Net book value at 31 December 2023
628
137
765
128
893
1. This represents a correction of a historic adjustment to cost and accumulated depreciation on acquired
property, plant, machinery and equipment. It has no net impact on net book value at any balance sheet
date presented.
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11 Property, Plant and Equipment continued
Where a vehicle is sold to a customer subject to a repurchase commitment and the possibility
of the buyback being exercised by the customer is highly likely, the transaction is recognised as
a lease transaction with the Group acting as a lessor. Consequently, such vehicles are included
in ‘leased vehicles, rental machinery and equipment’ in the table above.
The book value of land and buildings is analysed between:
2024
2023
£m
£m
Freehold
309
469
Leasehold with over fifty years unexpired
19
58
Short leasehold
54
87
Assets under construction
11
14
393
628
At 31 December 2024, land and buildings include properties with a net book value of £nil
(2023: £4m) that are let to third parties on a short-term basis.
Property, plant, machinery & equipment includes assets under construction with a net book
value of £11m (2023: £14m).
Impairment of computer software, property, plant and equipment and right-of-use assets
Computer software, property, plant and equipment and right-of-use assets are reviewed for
impairment if events or circumstances indicate that the carrying value may not be
recoverable. When an impairment review is carried out, the recoverable value is determined
based on the higher of value in use calculations, which require estimates to be made of future
cash flows, or fair value less costs of disposal. Impairment triggers were identified in a limited
number of markets and tests for impairment were carried out, where appropriate. As part of
the assessment, the Group also assessed whether there was any indication that previously
recognised impairment losses for an asset no longer exist or may have decreased which would
result in an impairment reversal being recognised.
The approach to test computer software, property, plant and equipment and right-of-use
assets for impairment was consistent with the approach used to test goodwill and other
indefinite-life intangible assets. The value in use calculations use cash flow projections based on
three-year financial forecasts prepared by management. The key assumptions for these
forecasts are those relating to volumes, revenue, gross margins, overheads, the level of working
capital required to support trading and capital expenditure. Where the value in use
calculations did not support the carrying value of an asset, an estimate for fair value less costs
of disposal was determined by obtaining property valuations for the relevant locations.
The results of the testing indicated that there were no net impairment charges in the year
(2023: £11m net impairment charges in the UK).
2024
2023
£m
£m
Property, plant and equipment
—
11
Right-of-use assets
—
—
At 31 December
—
11
The presence of potential physical risks arising from climate change to the Group’s key
operational sites in the short to medium term has been reviewed and no assets have been
impaired as a result of this exercise.
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12 Right-of-use assets and lease liabilities
The Group leases various retail dealerships, distribution, and office properties, primarily in
Australia, Hong Kong, and South America. Rental contracts are typically made for fixed periods
of 2 to 25 years and may have extension options as described in the accounting policies note.
Lease terms are negotiated on an individual basis and contain a wide range of different terms
and conditions.
a) Amounts recognised on the consolidated statement of financial position
Cost
£m
£m
£m
At 1 January 2023
800
3
803
Opening balance hyperinflation adjustment
1
—
1
Businesses acquired
11
—
11
Acquisition adjustments
(7)
—
(7)
Additions
35
1
36
Derecognition
(38)
(1)
(39)
Remeasurement
7
—
7
Reclassified to assets held for sale
(2)
—
(2)
Effect of foreign exchange rate changes
(32)
—
(32)
At 1 January 2024
775
3
778
Businesses sold (note 28a)
(138)
—
(138)
Additions
42
—
42
Derecognition
(49)
(2)
(51)
Remeasurement
35
—
35
Effect of foreign exchange rate changes
(31)
1
(30)
At 31 December 2024
634
2
636
Land and
buildings
Other
Total
Accumulated depreciation and impairment
£m
£m
£m
At 1 January 2023
(383)
(1)
(384)
Depreciation charge for the year
(80)
(1)
(81)
Derecognition
33
1
34
Remeasurement
3
—
3
Effect of foreign exchange rate changes
14
—
14
At 1 January 2024
(413)
(1)
(414)
Businesses sold (note 28a)
64
—
64
Depreciation charge for the year
(75)
—
(75)
Impairment losses recognised
(1)
—
(1)
Derecognition
49
—
49
Effect of foreign exchange rate changes
13
(1)
12
At 31 December 2024
(363)
(2)
(365)
Net book value at 31 December 2024
271
—
271
Net book value at 31 December 2023
362
2
364
Land and
buildings
Other
Total
Asset impairment charges amount to £1m (2023: impairment charge of £nil).
Remeasurements of £35m were made to leases during the year, due to either a change in the
lease term or a change in an index or rate applicable to the underlying lease (2023: £10m,
primarily in the UK, South America and APAC). Lease liabilities are also remeasured if there is a
change in the assessment of whether a purchase, lease term extension or termination option
will be exercised, exposure to potential variable lease payments during the life of the lease
together with any additional liability being present as a result of entering new lease
commitments which have not commenced as at the balance sheet date.
2024
2023
£m
£m
Lease liabilities
Current
(66)
(81)
Non-current
(236)
(359)
At 31 December
(302)
(440)
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12 Right-of-use assets and lease liabilities continued
b) Amounts recognised in the consolidated income statement
2024
2023
£m
£m
Depreciation of right-of-use assets
74
75
Impairment charge for right-of-use assets
1
—
Finance costs on lease liabilities (included in finance costs)
19
19
Lease rentals – short-term leases
5
7
Lease rentals – variable lease payments
1
1
Sub-lease income from right-of-use assets
—
(1)
c) Amounts recognised in the consolidated statement of cash flows
2024
2023
£m
£m
Lease interest paid
19
21
Payment of capital element of lease liabilities
81
87
13 Investments in joint ventures and associates
Details of the interests held by the Group in joint ventures and associates can be found in note
12 to the Inchcape plc Company financial statements on pages 204 to 210.
Amounts recognised in the statement of financial position in respect of joint ventures and
associates are as follows:
2024
2023
£m
£m
At 1 January
21
22
Additions
—
3
Share of profit after tax of joint ventures and associates
2
1
Return of investment following liquidation of joint venture
—
(2)
Dividends received
—
(1)
Effect of foreign exchange rate changes
(2)
(2)
At 31 December
21
21
Net assets of joint ventures and associates:
2024
2023
£m
£m
Cash and cash equivalents
10
14
Other current assets
61
41
Non-current assets
247
222
Total assets
318
277
Current financial liabilities
(60)
(46)
Other current liabilities
(2)
(5)
Non-current financial liabilities
(214)
(184)
Total liabilities
(276)
(235)
Net assets
42
42
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NOTES TO THE FINANCIAL STATEMENTS CONTINUED
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13 Investments in joint ventures and associates continued
Results of joint ventures and associates:
2024
2023
£m
£m
Revenue
71
61
Depreciation and amortisation
(1)
(1)
Other expenses
(65)
(57)
Profit before tax
5
3
Tax
(1)
(1)
Profit after tax of joint ventures and associates
4
2
Summarised financial information of joint ventures and associates:
2024
2023
£m
£m
Opening net assets at 1 January
42
44
Profit for the year
4
2
Additions
—
5
Return of investment following liquidation of joint venture
—
(4)
Other comprehensive expense for the year
—
(1)
Effect of foreign exchange rates
(4)
(4)
Closing net assets at 31 December
42
42
Carrying value of interest in joint ventures and associates
21
21
As at 31 December 2024, no guarantees were provided in respect of joint ventures and
associates’ borrowings (2023: £nil).
14 Financial assets at fair value through other comprehensive income
2024
2023
£m
£m
At 1 January
1
3
Net fair value gains/(losses) recognised in other comprehensive income
3
(2)
At 31 December
4
1
Analysed as:
2024
2023
£m
£m
Current
—
—
Non-current
4
1
4
1
Assets held are analysed as follows:
2024
2023
£m
£m
Equity securities
4
1
4
1
Financial assets held at fair value through other comprehensive income relate to a 15% equity
interest in Hino Motors Manufacturing Company SAS.
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15 Trade and other receivables
Current
Non-current
2024
2023
2024
2023
£m
£m
£m
£m
Trade receivables
440
455
18
17
Less: allowance for expected credit losses
(13)
(17)
—
—
Net trade receivables
427
438
18
17
Prepayments
174
148
3
10
Accrued income
35
36
2
1
Other taxation and social security
93
84
—
—
Other receivables
100
129
11
21
829
835
34
49
Other receivables include buyback and indemnity assets, interest, sublease and sundry
receivables, which include amounts receivable in respect of insurance claims, and rental and
utilities deposits. The breakdown of other receivables is as follows:
Current
Non-current
2024
2023
2024
2023
£m
£m
£m
£m
Buyback Assets
2
2
3
7
Indemnity Assets
16
16
—
—
Interest Receivable
7
2
—
—
Sublease receivables
2
3
1
7
Other
73
106
7
7
100
129
11
21
Trade receivables representing amounts due from customers, including finance houses,
mobility company partners, third-party dealers, and insurance companies are split by reporting
segment as follows:
2024
2023
£m
£m1
APAC
148
117
Europe & Africa
100
114
Americas
210
211
Discontinued operations
—
30
458
472
Less: allowance for expected credit losses
(13)
(17)
445
455
1. Prior year figures have been updated to align with the current year regional allocation.
At 31 December, the analysis of trade receivables is as follows:
Total
Current
0 – 30 days
30 – 90
days
> 90 days
2024
£m
£m
£m
£m
£m
Gross trade receivables
458
234
116
64
44
Expected credit loss allowance
(13)
(2)
—
—
(11)
Net carrying amount
445
231
116
64
33
Total
Current
0 – 30 days
30 – 90
days
> 90 days
2023
£m
£m
£m
£m
£m
Gross trade receivables
472
250
105
66
51
Expected credit loss allowance
(17)
(4)
—
—
(13)
Net carrying amount
455
246
105
66
38
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15 Trade and other receivables continued
Movements in the allowance for expected credit losses were as follows:
2024
2023
£m
£m
At 1 January
(15)
(17)
Charge for the year
(1)
(9)
Amounts written off
—
3
Business sold
—
—
Unused amounts reversed
2
6
Effect of foreign exchange rate changes
1
—
At 31 December
(13)
(17)
The expected credit loss for accrued income and other receivables is not significant.
Trade receivables are non-interest bearing and are generally on credit terms of 30 to 60 days.
Trade receivables are only written off where there is no reasonable expectation of recovery.
The concentration of credit risk with respect to trade receivables is limited due to the Group’s
broad customer base across a number of geographic regions and the default loss percentage
incurred by the Group has customarily been low even if there have been significant changes in
economic conditions experienced in markets in which the Group operates. Trade receivables
include amounts due from a number of finance houses in respect of vehicles sold to customers
on finance.
As a consequence, the risk associated with trade receivable balances past due but not
impaired is not expected to be significant and as such does not contribute to a significant
allowance for expected credit losses of receivables being recognised.
The allowance for expected credit losses for trade receivables and accrued income is based
on an expected credit loss model that calculates the expected loss applicable to the
receivable balance over its lifetime. For the Group, the simplified approach under IFRS 9
Financial Instruments is applied to all trade receivables and accrued income. Under this
approach, the provision required against receivables is calculated by considering the cash
shortfall that would be incurred in various default scenarios for prescribed future periods.
Default rates are calculated initially by considering historical loss experience and applied to
trade receivables within a provision matrix. The matrix approach allows application of different
default rates to different groups of customers with similar characteristics. These groups will be
determined by a number of factors including: the nature of the customer, the payment
method selected and, where relevant, the sector in which they operate. The characteristics
used to determine the groupings of receivables are the factors that have the greatest impact
on the likelihood of default. The rate of default increases once the balance is 30 days past due
and subsequently in 30-day increments.
Management considers the carrying amount of trade and other receivables to approximate to
their fair value. Long-term receivables have been discounted where the time value of money is
considered to be material.
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16 Deferred tax
Pension
and other
post-retirement
benefits
Cash flow
hedges
Share-based
payments
Tax
losses
Accelerated
tax
depreciation
Provisions
and other
temporary
differences
Indefinite-life
intangible
assets
Leases
Total
Net deferred tax (liability)/asset
£m
£m
£m
£m
£m
£m
£m
£m
£m
At 1 January 2023
(28)
(8)
6
20
(9)
53
(226)
17
(175)
Credited/(charged) to the consolidated income statement (continuing
operations)
—
2
1
2
(7)
15
(1)
(2)
10
Credited/(charged) to equity and other comprehensive income
—
18
—
(1)
(5)
3
—
—
15
Businesses acquired
2
—
—
—
(16)
14
(29)
—
(29)
Acquisition adjustments (note 28b)
—
—
—
—
—
2
—
—
2
Effect of foreign exchange rate changes
—
—
—
1
1
(3)
16
—
15
At 1 January 2024
(26)
12
7
22
(36)
84
(240)
15
(162)
Opening balance reclassifications
8
—
(2)
—
1
(7)
—
—
—
(Charged)/credited to the consolidated income statement (continuing
operations)
13
(2)
4
2
(2)
(12)
(7)
2
(2)
Credited/(charged) to the consolidated income statement (discontinued
operations)
—
—
—
8
—
—
—
—
8
(Charged)/credited to equity and other comprehensive income
(1)
(12)
—
(1)
(1)
1
—
—
(14)
Businesses sold (note 28a)
(3)
—
(1)
—
(6)
9
—
(6)
(7)
Acquisition adjustments (note 28b)
—
—
—
—
—
2
—
—
2
Effect of foreign exchange rate changes
—
(1)
—
(1)
7
(8)
23
—
20
At 31 December 2024
(9)
(3)
8
30
(37)
69
(224)
11
(155)
2024
2023
£m
£m
Deferred tax assets
91
105
Deferred tax liabilities
(246)
(267)
(155)
(162)
Inchcape Annual Report and Accounts 2024
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NOTES TO THE FINANCIAL STATEMENTS CONTINUED
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16 Deferred tax continued
Unrecognised deferred tax
Measured at relevant local statutory rates, the Group has an unrecognised deferred tax asset
of £149m (2023: £132m) split as follows:
2024
2023
Gross
amount
Net amount
Gross
amount
Net
amount
As at 31 December
£m
£m
£m
£m
Trading losses
259
66
229
59
Capital losses
158
39
179
45
UK corporate interest restriction
144
36
92
23
Other deductible temporary differences
30
8
20
5
Total
591
149
520
132
Measured at relevant local statutory rates, the Group has an unrecognised deferred tax asset
of £66m (2023: £59m) relating to tax relief on trading losses. The unrecognised asset represents
£259m (2023: £229m) of losses which exist within legal entities where forecast taxable profits are
not probable in the foreseeable future. Unrecognised deferred tax on trading losses includes
£6m (2023: £8m) which will expire within 5 years and £5m (2023: £4m) which will expire in more
than 5 years.
The unrecognised deferred tax assets relating to capital losses are primarily held in the UK.
The Group has unrecognised deferred tax assets in relation to disallowed interest under the UK
Corporate interest restriction regulations of £36m (2023: £23m).
The net deferred tax asset relating to the remaining UK group of companies, following the
disposal of the UK Retail operations (note 28), remains unrecognised as at 31 December 2024.
Therefore, on a continuing basis, no deferred tax charges or credits are recorded in the
consolidated income statement or consolidated statement of other comprehensive income in
relation to temporary differences arising in the period for these companies (2023: no deferred
tax charges or credits recorded in relation to temporary differences).
Recognised deferred tax
The deferred tax asset on tax trading losses of £30m (2023: £22m) relates to territories and
entities where future taxable profits are considered probable.
The net deferred tax asset on provisions and other temporary differences is principally made up
of trade related accounting provisions and other items in the Group’s operating companies
£69m (2023: £91m), offset by a deferred tax liability on non-qualifying property £nil (2023: £7m).
The deferred tax liability of £224m (2023: £240m) on indefinite life intangible assets, comprising
distribution agreements and acquired brands, has been recorded as a result of the business
acquisitions in prior periods.
Relevant tax laws largely exempt receipt of dividends from tax. A tax liability is more likely to
arise in respect of withholding taxes levied by overseas jurisdictions. No deferred tax liability has
been recognised in respect of £456m (2023: £304m) of post-acquisition unremitted earnings of
subsidiaries because the Group controls the timing of the reversal of the temporary difference
and it is probable that the temporary difference will not reverse in the next 12 months. Deferred
tax is provided when there is an intention to distribute earnings and a tax liability arises. It is not
practicable to estimate the amount of unrecognised deferred tax liabilities in respect of these
unremitted earnings.
17 Inventories
2024
2023
£m
£m
Raw materials and work in progress
160
124
Finished goods and merchandise
1,775
2,594
1,935
2,718
Vehicles held on consignment which are in substance assets of the Group amount to £3m
(2023: £65m), with the year-on-year reduction due to the disposal of the UK Retail business.
These have been included in ‘finished goods and merchandise’ with the corresponding liability
included within ‘trade and other payables’. Payment becomes due when title passes to the
Group, which is generally the earlier of a period of up to six months from delivery or the date
of sale.
An amount of £85m (2023: £99m) has been provided against the gross cost of inventory at the
year end. The cost of inventories recognised as an expense in the year is £7,517m (2023:
£7,494m). The net write-down of inventory to net realisable value recognised as an expense
during the year was £3m (2023: expense of £28m). All of these items have been included within
‘cost of sales’ in the consolidated income statement.
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18 Cash and cash equivalents
2024
2023
£m
£m
Cash at bank
458
610
Short-term deposits
91
79
549
689
Cash and cash equivalents are generally subject to floating interest rates determined by
reference to short-term benchmark rates applicable to the relevant currency or market
(primarily SONIA or the local equivalent). At 31 December 2024, the weighted average floating
rate was 3.9% (2023: 3.6%).
£37m (2023: £95m) of cash and cash equivalents is held in Ethiopia where currency may not be
available locally to effect such transfers.
At 31 December 2024, short-term deposits have a weighted average period to maturity of 6
days (2023: 24 days).
19 Assets held for sale
2024
2023
£m
£m
Assets classified as held for sale
20
14
As at 31 December 2024 assets held for sale relate to retail sites in Australia which are actively
marketed with a view to sale within 12 months of the balance sheet date.
20 Trade and other payables
Current
Non-current
2024
2023
2024
2023
£m
£m
£m
£m
Trade payables
260
358
—
—
Payments received on account
110
120
—
8
Vehicle funding agreements
1,582
1,877
—
—
Other taxation and social security payable
90
97
—
—
Accruals
374
467
1
1
Deferred income
87
144
101
53
Other payables
62
87
4
7
2,565
3,150
106
69
Other payables includes deferred consideration, interest payable and buyback liabilities.
The Group finances the purchase of new vehicles for sale and a portion of used vehicle
inventories using vehicle funding facilities provided by various lenders including the captive
finance companies associated with brand partners. Such arrangements generally are
uncommitted facilities, have a maturity of 180 days or less and the Group repays the amounts
outstanding either in line with the normal working capital cycle or on the earlier of the sale of
the vehicles that have been funded under the facilities or the stated maturity date, depending
on the facility. Some arrangements may also provide the lender with a security interest in the
inventory until the amount drawn under the arrangement has been repaid. Related cash flows
are reported within cash flows from operating activities within the consolidated statement of
cash flows.
Vehicle funding facilities are subject to variable interest rates. The interest incurred under these
arrangements is included within finance costs and classified as interest on inventory financing
(see note 6). At 31 December 2024, amounts outstanding under vehicle funding facilities and
on which interest was payable were subject to a weighted average interest rate of 5.1% (2023:
4.7%). Management considers the carrying amount of trade and other payables to
approximate to their fair value. Long-term payables have been discounted where the time
value of money is considered to be material.
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20 Trade and other payables continued
As at 31 December, the analysis of vehicle funding arrangements is as follows:
2024
2023
£m
£m
£m
£m
£m
£m
OEM
Non-OEM
Total
OEM
Non-OEM
Total
Carrying amount of vehicle
funding arrangements
363
1,219
1,582
559
1,318
1,877
-of which suppliers have
received payment
—
1,219
1,219
—
1,318
1,318
Range of weighted average
payment due dates
Vehicle funding arrangements
80-100
days
60-120
days
50-70
days
60-110
days
Trade payables
20-50
days
20-50
days
Included within deferred income are the following balances:
2024
2023
£m
£m
Extended warranties
59
42
Service packages
88
78
Other services
41
77
188
197
Revenue recognised in 2024 that was included in deferred income at the beginning of the year
was £115m (2023: £124m).
Extended warranties
Certain Group companies provide extended warranties to customers over and above those
provided by the manufacturer and act as the principal in the supply of the warranty service.
The periods covered are up to six years and/or specific mileage limits. A proportion of revenue
is allocated to the extended warranty obligation and deferred to the balance sheet. The
revenue is subsequently recognised over time along with the costs incurred in fulfilling any
warranty obligations.
Service packages
Certain Group companies provide service packages to customers as part of the total vehicle
package. Where the Group acts as principal, the value of the additional services is separately
identified, deducted from revenue, and recognised as deferred income on the balance sheet.
It is subsequently recognised as revenue when the service is provided or the package expires.
Other services
Certain Group companies provide other services as part of the total vehicle package (e.g.
roadside assistance, fuel coupons etc.). Where the Group acts as principal, the value of the
additional services is separately identified, deducted from revenue, and recognised as
deferred income on the balance sheet. It is subsequently recognised as revenue over the
period to which the service relates.
21 Provisions
Product
warranty
Leasehold
Litigation
Other
Total
Cost
£m
£m
£m
£m
£m
At 1 January 2024
50
8
3
47
108
Acquisition adjustment (note 28b)
5
—
—
—
5
Businesses sold (note 28a)
—
(1)
—
(1)
(2)
Charged to the consolidated income
statement
20
4
1
9
34
Released to the consolidated income
statement
(7)
(1)
(1)
(12)
(21)
Utilised during the year
(27)
(2)
—
(4)
(33)
Effect of foreign exchange rate changes
(3)
—
(1)
(11)
(15)
At 31 December 2024
38
8
2
28
76
Inflation and expected future movements in prices have been considered in calculating
provisions where relevant.
Analysed as:
2024
2023
£m
£m
Current
50
69
Non-current
26
39
76
108
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170
21 Provisions continued
Product warranty
Certain Group companies provide assurance warranties as part of the sale of a vehicle. These
are not separable products. The warranty periods covered are up to five years and/or specific
mileage limits. Provision is made for the expected cost of labour and parts based on historical
claims experience and expected future trends. These assumptions are reviewed regularly.
Leasehold
The Group is committed to certain leasehold premises for which it no longer has a commercial
use. These are principally located in Australia and Hong Kong. Provision has been made to the
extent of the estimated future net cost, excluding the lease liability recognised under IFRS 16
Leases. This includes taking into account existing subtenant arrangements. The category also
includes the future obligation relating to dilapidations of certain premises. The expected
utilisation period of these provisions is generally over the next 10 years.
Litigation
This includes a number of litigation provisions in respect of claims that have been brought
against various Group companies. The claims are generally expected to be concluded within
the next three years.
Other
This category principally includes provisions relating to uncertain non-income taxes. It also
includes provisions relating to restructuring activities of £2m (2023:£2m). Acquisition and
disposal related provisions amount to £10m (2023(represented): £10m), of which there is an
offsetting indemnity asset recognised in trade and other receivables. Other provisions also
includes long-service provisions of £5m (2023: £8m). These provisions are expected to be utilised
within three years except for those relating to long-service provisions.
Climate change
The Group has reviewed its provisions and concluded that no adjustments need to be
made for climate change risks, nor that any new provisions need to be recognised for
climate-related matters.
22 Borrowings
Floating rate
Fixed rate
Weighted
average
effective
interest rate
Weighted
average
effective
interest rate
Total
interest
bearing
2024
Total
2024
£m
%
£m
%
£m
£m
Current
Bank overdrafts
183
5.3 %
—
— %
183
183
Bank loans
2
4.4 %
10
5.5 %
12
12
Private Placement
—
— %
—
— %
—
—
185
5.3 %
10
5.5 %
195
195
Non-current
Bank loans
55
5.6 %
349
6.5 %
404
404
Private Placement
—
— %
140
3.1 %
140
140
55
5.6 %
489
5.5 %
544
544
Total borrowings
240
5.4 %
499
5.5 %
739
739
Bank overdrafts include £177m (2023: £245m) held in cash pooling arrangements which have
not been offset in the consolidated statement of financial position (see note 23(b)).
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22 Borrowings continued
Floating rate
Fixed rate
Weighted
average
effective
interest rate
Weighted
average
effective
interest rate
Total
interest
bearing
2023
Total
2023
£m
%
£m
%
£m
£m
Current
Bank overdrafts
249
5.9 %
—
— %
249
249
Bank loans
298
6.2 %
35
7.8 %
333
333
Private Placement
—
— %
70
3.0 %
70
70
547
6.1 %
105
4.6 %
652
652
Non-current
Bank loans
150
5.5 %
348
6.5 %
498
498
Private Placement
—
— %
140
3.0 %
140
140
150
5.5 %
488
5.5 %
638
638
Total borrowings
697
5.9 %
593
5.4 %
1,290
1,290
Interest payments on floating rate financial liabilities are determined by reference to short-term
benchmark rates applicable to the relevant currency or market (primarily SONIA or the local
equivalent).
As at 31 December 2024, the funding structure of the Group was comprised of a committed
syndicated revolving credit facility of £900m (2023: £900m), sterling Private Placement Loan
Notes totalling £140m (2023: £210m) and a five-year bond of £350m, at a fixed coupon of 6.5%.
(2023: £350m). During the year, the term facility of £250m was repaid, following the disposal of
the UK Retail business, together with the debt acquired from acquisitions in 2022 and 2023.
As at 31 December 2024, £55m of the syndicated revolving credit facility was drawn
(2023: £150m).
The £350m public bond is held at amortised cost and had a fair value of £358m as at
31 December 2024 based on quoted prices, which is a level 1 valuation technique.
In December 2023, the Group’s syndicated revolving credit facility was amended, increasing
the facility to £900m and extending the maturity to December 2028. In November 2024, the
maturity of the facility was extended to December 2029 with a reduction in the facility to
£818m with effect from 1 December 2028.
The Group’s bank loans are not secured by any term deposits placed under a standby letter of
credit and related facility arrangements (2023: £nil secured). The Group’s bank overdrafts are
secured by related offsetting cash balances held under pooling arrangements. The Group’s
remaining borrowings are unsecured.
In December 2016, the Group concluded a Private Placement transaction raising £210m to
refinance existing US dollar Private Placement borrowings which matured in May 2017. In May
2024, £70m of Private Placement borrowings were repaid.
Maturity date
May 2027
May 2027
May 2029
Amount drawn
£30m
£70m
£40m
Fixed rate coupon
3.02 %
3.12 %
3.10 %
The £140m sterling Private Placement loan notes are held at amortised cost. They have a fair
value of £135m (calculated from discounted cash flow techniques obtained using discount
rates from observable market data, which is a level 2 valuation technique. The fair values of the
Group’s other borrowings, other than the £350m public bond, are not considered to be
materially different from their book value.
The table below sets out the maturity profile of the Group’s existing borrowings that are
exposed to interest rate risk.
Less than 1
year
Between 1
and
2 years
Between 2
and
3 years
Between 3
and
4 years
Between 4
and
5 years
Greater
than 5
years
Total
interest
bearing
2024
£m
%
£m
%
£m
£m
£m
Fixed rate
Bank loans
10
—
—
349
—
—
359
Private Placement
—
—
100
—
40
—
140
10
—
100
349
40
—
499
Floating rate
Bank overdrafts
183
—
—
—
—
—
183
Bank loans
2
—
—
—
55
—
57
185
—
—
—
55
—
240
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22 Borrowings continued
Less than 1
year
Between 1
and
2 years
Between 2
and
3 years
Between 3
and
4 years
Between 4
and
5 years
Greater
than 5
years
Total
interest
bearing
2023
£m
%
£m
%
£m
£m
£m
Fixed rate
Bank loans
35
—
—
—
348
—
383
Private Placement
70
—
—
100
—
40
210
105
—
—
100
348
40
593
Floating rate
Bank overdrafts
249
—
—
—
—
—
249
Bank loans
298
—
—
—
150
—
448
547
—
—
—
150
—
697
23 Financial instruments
The Group’s financial liabilities, other than derivatives, comprise borrowings, trade and other
payables and lease liabilities. The main purpose of these instruments is to raise finance for the
Group’s operations.
The Group also has various financial assets such as trade and other receivables, cash and
short-term deposits which arise from its trading operations. The Group’s primary derivative
transactions include forward and swap currency contracts. The purpose is to manage the
currency and interest rate risks arising from the Group’s trading operations and its sources of
finance. Group policy is that there is no trading or speculation in derivatives. Cash flow hedge
ineffectiveness can arise from changes to the timing and amounts of forecasted cash flows of
hedged items. Fair value hedge ineffectiveness can arise from different yield curves linked to
the hedged item and hedging instrument as well as changes to the counterparties credit risk.
The main risks arising from the Group’s financial instruments are interest rate risk, currency risk,
credit risk and liquidity risk.
The Group does not hedge for inflation risk and has not hedged for cross-currency interest rates
risk in recent years.
a) Classification of financial instruments
Measured
at
amortised
cost
Measured
at fair value
through other
comprehensive
income
Measured
at fair value
through
profit
or loss
Total
2024
£m
£m
£m
£m
Financial assets
Financial assets at fair value through other
comprehensive income
—
4
—
4
Trade and other receivables
556
—
—
556
Derivative financial instruments
—
7
41
48
Cash and cash equivalents
549
—
—
549
Total financial assets
1,105
11
41
1,157
Financial liabilities
Trade and other payables
(2,192)
—
—
(2,192)
Derivative financial instruments
—
(6)
(41)
(47)
Lease liabilities
(302)
—
—
(302)
Borrowings
(739)
—
—
(739)
Total financial liabilities
(3,233)
(6)
(41)
(3,280)
(2,128)
5
—
(2,123)
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Measured
at
amortised
cost
Measured
at fair value
through other
comprehensive
income
Measured
at fair value
through
profit
or loss
Total
2023
£m
£m
£m
£m
Financial assets
Financial assets at fair value through other
comprehensive income
—
1
—
1
Trade and other receivables
613
—
—
613
Derivative financial instruments
—
4
35
39
Cash and cash equivalents
689
—
—
689
Total financial assets
1,302
5
35
1,342
Financial liabilities
Trade and other payables
(2,754)
—
—
(2,754)
Derivative financial instruments
—
(58)
(39)
(97)
Lease liabilities
(440)
—
—
(440)
Borrowings
(1,290)
—
—
(1,290)
Total financial liabilities
(4,484)
(58)
(39)
(4,581)
(3,182)
(53)
(4)
(3,239)
b) Offsetting financial assets and financial liabilities
The following financial assets are subject to offsetting, enforceable netting arrangements and
similar agreements:
Related amounts not set
off in the statement of
financial position
Gross
amounts
of financial
assets
Gross amounts
of financial
liabilities
set off in the
statement
of financial
position
Net amounts of
financial assets
presented in
the statement
of financial
position
Financial
instruments
Cash
collateral
received
Net
amount
£m
£m
£m
£m
£m
£m
As at 31 December 2024
Derivative financial assets
48
—
48
(19)
—
29
Cash and cash equivalents
549
—
549
(177)
—
372
597
—
597
(196)
—
401
As at 31 December 2023
Derivative financial assets
39
—
39
(24)
—
15
Cash and cash equivalents
689
—
689
(245)
—
444
728
—
728
(269)
—
459
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Related amounts not set
off in the statement of
financial position
Gross
amounts
of financial
assets
Gross amounts
of financial
liabilities
set off in the
statement
of financial
position
Net amounts of
financial assets
presented in
the statement
of financial
position
Financial
instruments
Cash
collateral
received
Net
amount
£m
£m
£m
£m
£m
£m
As at 31 December 2024
Derivative financial liabilities
(47)
—
(47)
19
—
(28)
Bank overdrafts
(183)
—
(183)
177
—
(6)
(230)
—
(230)
196
—
(34)
As at 31 December 2023
Derivative financial liabilities
(97)
—
(97)
24
—
(73)
Bank overdrafts
(249)
—
(249)
245
—
(4)
(346)
—
(346)
269
—
(77)
For the financial assets and liabilities subject to enforceable netting arrangements or similar
agreements above, each agreement between the Group and the counterparty allows for net
settlement of the relevant financial assets and liabilities. If the parties subject to the agreement
do not elect to settle on a net basis, financial assets and liabilities will be settled on a gross
basis. However, each party to the netting agreement will have the option to settle all such
amounts on a net basis in the event of a default of the other party.
c) Market risk and sensitivity analysis
Financial instruments affected by market risk include borrowings, deposits, and derivative
financial instruments. The Group is not exposed to commodity price risk. The following analysis,
required by IFRS 7 Financial Instruments: Disclosures, is intended to illustrate the sensitivity to
changes in market variables, being primarily UK interest rates and the Australian dollar to
Japanese yen exchange rate.
The following assumptions were made in calculating the sensitivity analysis:
• changes in the carrying value of derivative financial instruments designated as cash flow
hedges from movements in interest rates are assumed to be recorded fully in equity;
• changes in the carrying value of derivative financial instruments designated as fair value
hedges from movements in interest rates have an immaterial effect on the consolidated
income statement and equity due to compensating adjustments in the carrying value
of debt;
• changes in the carrying value of financial instruments designated as net investment hedges
from movements in the US dollar to sterling exchange rate are recorded directly in equity;
and
• changes in the carrying value of financial instruments not in hedging relationships only affect
the consolidated income statement.
d) Interest rate risk and sensitivity analysis
The Group’s interest rate policy has the objective of minimising net interest expense and
protecting the Group from material adverse movements in interest rates.
Instruments approved for the purpose of hedging interest rate risk include interest rate swaps,
forward rate agreements and options. The Group’s exposure to the risk of changes in market
interest rates arises primarily from the floating rate interest payable on the Group’s bank
borrowings, supplier-related finance, and the returns available on surplus cash.
Interest rate risk table
The following table demonstrates the sensitivity of the Group’s profit before tax to a reasonably
possible change, based on recent experience, in interest rates on bank borrowings,
supplier-related finance and cash balances as at 31 December 2024, with all other variables
held constant.
Decrease
in basis
points
Gain/(loss) on profit
before tax
Increase
in basis
points
Gain/(loss) on profit
before tax
%
£m
%
£m
2024
Sterling
100
5
100
(5)
Euro
100
1
100
(1)
Chilean peso
250
(1)
250
1
Australian dollar
100
(2)
100
2
US dollar
100
5
100
(5)
2023
Sterling
100
11
100
(11)
Euro
100
2
100
(2)
Chilean peso
250
2
250
(2)
Australian dollar
100
(1)
100
1
US dollar
100
3
100
(3)
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23 Financial instruments continued
e) Foreign currency risk
The Group publishes its consolidated financial statements in sterling and faces currency risk on
the translation of its earnings and net assets, a significant proportion of which are in currencies
other than sterling.
Transaction exposure hedging
The Group has transactional currency exposures, where sales or purchases by an operating unit
are in currencies other than in that unit’s reporting currency. For a significant proportion of the
Group these exposures are removed as trading is denominated in the relevant local currency.
In particular, local billing arrangements are in place for many of our businesses with our brand
partners. The principal exception is for our business in Australia which purchases vehicles in
Japanese yen and our South and Central American businesses which purchase vehicles in
Japanese yen and US dollars.
In this instance, the Group seeks to hedge forecast transactional foreign exchange rate risk
using forward foreign currency exchange contracts. The effective portion of the gain or loss on
the hedge is initially recognised in the consolidated statement of comprehensive income to
the extent it is effective. When the hedged forecast transaction results in the recognition of a
non-financial asset or liability then, at the time the asset or liability is recognised, the associated
gains or losses that had previously been recognised in other comprehensive income are
included in the initial measurement of the acquisition cost or other carrying amount of the asset
or liability.
For all other cash flow hedges, the gains or losses that are recognised in other comprehensive
income are transferred to the consolidated income statement in the same period in which the
hedged forecast transaction affects the consolidated income statement. Under IFRS 9
Financial Instruments, hedges are documented and tested for the hedge effectiveness on an
ongoing basis.
Foreign currency risk table
The following table shows the Group sensitivity to a reasonably possible change in foreign
exchange rates on its Japanese yen financial instruments. In this table, financial instruments are
only considered sensitive to foreign exchange rates when they are not in the functional
currency of the entity that holds them.
Increase/
(decrease) in
exchange
rate
Effect on
equity
%
£m
2024
Yen
+10 %
3
Yen
-10 %
(3)
2023
Yen
+10 %
3
Yen
-10 %
(3)
f) Credit risk
The amount due from counterparties arising from cash deposits and the use of financial
instruments creates credit risk. The Group monitors its credit exposure to its counterparties via
their credit ratings (where applicable) and through its policy of limiting its exposure to any one
party to ensure that they are within Board approved limits and that there are no significant
concentrations of credit risk.
Group policy is to deposit cash and use financial instruments with counterparties with a long-
term credit rating of A or better, where available. The notional amounts of financial instruments
used in interest rate and foreign exchange management do not represent the credit risk arising
through the use of these instruments. The immediate credit risk of these instruments is generally
estimated by the fair value of contracts with a positive value. Credit limits are
reviewed regularly.
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23 Financial instruments continued
The table below analyses the Group’s derivative assets, cash at bank and short-term deposits
by credit exposure:
2024
2023
Derivative
assets
Cash
at bank
Short-term
deposits
Derivative
assets
Cash
at bank
Short-term
deposits
Credit rating of counterparty
£m
£m
£m
£m
£m
£m
AA
—
1
—
—
—
—
AA-
4
181
1
1
198
—
A+
11
1
—
8
33
—
A
4
4
—
7
170
—
A-
21
29
17
9
21
—
BBB+
5
42
2
8
35
—
BBB
—
13
8
2
6
—
BBB-
—
29
4
—
5
1
BB+
—
10
—
—
3
—
BB
—
58
—
—
—
—
BB-
—
—
—
—
14
—
No rating*
3
90
59
4
125
78
48
458
91
39
610
79
Counterparties in certain markets in which the Group operates do not have a credit rating.
For those counterparties which do not have a credit rating, where possible the Group works
with partner banks with a local presence to provide additional assurance. Additionally, the
Group proactively repatriates cash through cash-pooling arrangements, loans between Group
companies and dividends as well as regularly monitoring the spread of counterparties in-
country, notably in Ethiopia.
No credit limits were exceeded during the reporting period and management does not expect
any losses from non-performance by these counterparties.
The maximum exposure to credit risk for cash at bank, receivables and other financial assets is
represented by their carrying amount.
Total cash at bank of £458m (2023: £610m) includes cash in the Group’s regional pooling
arrangements which are offset against borrowings for interest purposes. Netting of cash and
overdraft balances in the consolidated statement of financial position only occurs to the extent
that there is the legal ability and intention to settle net. As such, overdrafts are presented in
current liabilities to the extent that there is no intention to offset with the cash balance.
Trade receivables include amounts due from a number of finance houses in respect of vehicles
sold to customers on finance arranged through the Group. An independent credit rating
agency is used to assess the credit standing of each finance house. Limits for the maximum
outstanding with each finance house are set accordingly.
g) Liquidity risk
Prudent liquidity risk management includes maintaining sufficient cash and marketable
securities, the availability of funding through an adequate amount of committed credit
facilities and the ability to close out market positions. Due to the dynamic nature of the
underlying businesses, Group Treasury aims to maintain flexibility in funding by keeping
committed credit lines available.
The table below summarises the maturity profile of the Group’s financial assets and liabilities at
31 December 2024 based on contractual expected undiscounted cash flows:
Less than
3 months
Between
3 to 12
months
Between
1 to 5
years
Greater
than
5 years
Total
2024
£m
£m
£m
£m
£m
Financial assets
Cash and cash equivalents
549
—
—
—
549
Trade and other receivables
415
120
21
—
556
Financial assets at fair value through other
comprehensive income
—
—
3
1
4
Derivative financial instruments
2,501
1,227
7
—
3,735
3,465
1,347
31
1
4,844
Financial liabilities
Interest bearing loans and borrowings
(255)
(22)
(554)
—
(831)
Lease liabilities
(25)
(67)
(239)
(202)
(533)
Trade and other payables
(1,587)
(597)
(8)
—
(2,192)
Derivative financial instruments
(2,517)
(1,237)
(7)
—
(3,761)
(4,384)
(1,923)
(808)
(202)
(7,317)
Net outflows
(919)
(576)
(777)
(201)
(2,473)
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23 Financial instruments continued
Less than
3 months
Between
3 to 12
months
Between
1 to 5
years
Greater
than
5 years
Total
2023
£m
£m
£m
£m
£m
Financial assets
Cash and cash equivalents
689
—
—
—
689
Trade and other receivables
428
156
25
4
613
Financial assets at fair value through other
comprehensive income
—
—
—
1
1
Derivative financial instruments
2,720
1,288
264
—
4,272
3,837
1,444
289
5
5,575
Financial liabilities
Interest bearing loans and borrowings
(444)
(398)
(545)
(41)
(1,428)
Lease liabilities
(27)
(74)
(253)
(205)
(559)
Trade and other payables
(2,178)
(565)
(10)
(2)
(2,755)
Derivative financial instruments
(2,739)
(1,347)
(285)
—
(4,371)
(5,388)
(2,384)
(1,093)
(248)
(9,113)
Net outflows
(1,551)
(940)
(804)
(243)
(3,538)
h) Fair value measurement
In accordance with IFRS 13 Fair Value Measurement, disclosure is required for financial
instruments that are measured in the consolidated statement of financial position at fair value.
This requires disclosure of fair value measurements by level for the following fair value
measurement hierarchy:
• quoted prices in active markets (level 1);
• inputs other than quoted prices that are observable for the asset or liability, either directly or
indirectly (level 2); or
• inputs for the asset or liability that are not based on observable market data (level 3).
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23 Financial instruments continued
The following table presents the Group’s assets and liabilities that are measured at fair value:
2024
2023
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
Total
£m
£m
£m
£m
£m
£m
£m
£m
Assets
Derivatives used for hedging
—
48
—
48
—
39
—
39
Financial assets at fair value through other comprehensive income
—
—
4
4
—
—
1
1
—
48
4
52
—
39
1
40
Liabilities
—
(97)
—
(97)
Derivatives used for hedging
—
(47)
—
(47)
—
(97)
—
(97)
Level 1 represents the fair value of financial instruments that are traded in active markets and is
based on quoted markets prices at the end of the reporting period.
The fair value of financial instruments that are not traded in an active market (level 2) is
determined by using valuation techniques which include the present value of estimated future
cash flows. These valuation techniques maximise the use of observable market data where it is
available and rely as little as possible on entity specific estimates.
Level 3 primarily represents the Group’s equity interest in Hino Motors Manufacturing Company
SAS (see note 14). Fair value is based on discounted free cash flows, using the projection of
annual income and expenses mainly based on historical financial figures.
Derivative financial instruments are carried at their fair values. The fair value of forward foreign
exchange contracts and foreign exchange swaps represents the difference between the
value of the outstanding contracts at their contracted rates and a valuation calculated using
the spot rates of exchange prevailing at 31 December 2024.
The Group’s derivative financial instruments comprise the following:
Assets
Liabilities
2024
2023
2024
2023
£m
£m
£m
£m
Forward foreign exchange contracts
48
39
(47)
(97)
48
39
(47)
(97)
The ineffective portion recognised in the consolidated income statement that arises from fair
value hedges amounts to £nil (2023: £nil). The ineffective portion recognised in the
consolidated income statement that arises from cash flow hedges amounts to £nil (2023: £nil).
Derivative financial instruments
The Group principally uses forward foreign exchange contracts to hedge purchases in a non-
functional currency against movements in exchange rates. The cash flows relating to these
contracts are generally expected to occur within 12 months (2023: 12 months) of the end of
the reporting period.
Net fair value gains and losses recognised in the hedging reserve in shareholders’ equity (see
note 25) on forward foreign exchange contracts as at 31 December 2024 are expected to be
released to the consolidated income statement within 12 months of the end of the reporting
period (2023: 12 months).
The below table illustrates the effects of hedge accounting on the consolidated statement of
financial position and consolidated income statement through detailing separately by risk
category and each type of hedge the details of the associated hedging instrument and
hedged item.
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2024
Current
Current
Non-current
Hedging risk strategy
Cash flow hedges
Fair value hedges
Cash flow hedges
Notional/currency legs (£m)
2,285
1,443
7
Carrying amount net liabilities (£m)
6
(5)
—
Maturity date
to Dec 2025
to Dec 2025
to Mar 2026
Hedge ratio
1:1
1:1
1:1
Description of hedged item
High probable FX
exposures
FX exposure on
balance sheet
High probable FX
exposures
Change in fair value of outstanding
hedging instruments since
1 January (£m)1
45
5
9
Change in fair value of hedging item
used to determine hedge
effectiveness (£m)
(45)
(5)
(9)
Weighted average hedge rate of
outstanding deals (AUD/JPY)2
94
n/a
—
Amounts recognised within net finance
costs (£m)
—
—
—
Cash flow hedge reserve (net of tax) at
31 December (£m)
9
—
—
2023
Current
Current
Non-current
Hedging risk strategy
Cash flow hedges
Fair value hedges
Cash flow hedges
Notional/currency legs (£m)
2,422
1,585
264
Carrying amount net liabilities (£m)
(39)
(10)
(9)
Maturity date
to Dec 2024
to Dec 2024
to Mar 2026
Hedge ratio
1:1
1:1
1:1
Description of hedged item
High probable FX
exposures
FX exposure on
balance sheet
High probable FX
exposures
Change in fair value of outstanding
hedging instruments since
1 January (£m)1
(22)
(26)
(25)
Change in fair value of hedging item
used to determine hedge
effectiveness (£m)
22
26
25
Weighted average hedge rate of
outstanding deals (AUD/JPY)2
89
n/a
—
Amounts recognised within net finance
costs (£m)
—
—
—
Cash flow hedge reserve (net of tax) at
31 December (£m)
34
—
—
1. Includes hedging derivatives for both actual and highly probable forecasted purchases. The movement
presented in other comprehensive income only covers hedging derivatives relating to highly probable
forecasted purchases.
2. Outstanding deals predominantly relate to our business in Australia which purchases vehicles in
Japanese yen.
As at 31 December 2024, the accumulated balance of the cash flow hedge reserve was a loss
of £9m (2023: loss of £34m). The above changes in fair value of hedging instruments will include
hedge positions taken up for future foreign currency exposures and will also include amounts
that would have been reclassified from the hedge reserve to the balance sheet as at
31 December 2024.
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23 Financial instruments continued
i) Capital management
The Group’s capital structure consists of equity and debt. Equity represents funds raised from
shareholders and debt represents funds raised from banks and other financial institutions. The
primary objective of the Group’s management of debt and equity is to ensure that it maintains
a strong credit rating and healthy capital ratios in order to finance the Group’s activities, both
now and in the future, and to maximise shareholder value.
The Group manages its capital structure and makes adjustments to it in light of changes in
economic conditions. To maintain or adjust the capital structure, the Group may adjust the
dividend payment to shareholders, return capital to shareholders or issue new shares. The
Directors consider the Group’s capital structure and dividend policy at least twice a year prior
to the announcement of results, taking into account the Group’s ability to continue as a going
concern and the requirements of its business plan.
The Group uses return on capital employed (ROCE) as a measure of its ability to drive better
returns on the capital invested in the Group’s operations. See alternative performance
measures on page 190.
2024
2023
£m
£m
Return on capital employed
27 %
27 %
The committed bank facilities and Private Placement borrowings are subject to the same
interest cover covenant based on an adjusted EBITA measure to interest on consolidated
borrowings. The Group is required to maintain a ratio of not less than three to one and was
compliant with this covenant throughout the year.
The Group monitors Group leverage by reference to two tests: adjusted EBITA interest cover
and the ratio of adjusted net debt to EBITDA. The leverage tests are measured excluding the
impact of IFRS 16 Leases.
Threshold
2024
2023
£m
£m
Adjusted EBITA interest cover (times)*
> 3
8.8
7.9
Adjusted net debt to EBITDA (times)**
< 1
0.3
0.8
* Calculated as Adjusted EBITA/interest on consolidated borrowings.
** Calculated as adjusted net debt/adjusted earnings before interest, tax, depreciation, and amortisation.
24 Share capital
Allotted, and fully paid share capital
2024
2023
2024
2023
Number
Number
£m
£m
Issued and fully paid ordinary shares
(nominal value of 10.0p each)
At 1 January
413,007,132 374,494,030
42
38
Shares issued
— 38,513,102
—
4
Cancelled under share buyback
(18,673,960)
—
(2)
—
At 31 December
394,333,172 413,007,132
40
42
The Company’s ordinary shares are fully paid and no further contribution of capital may be
required by the Company from the shareholders.
a) Share buyback programme
In 2024, 18,673,960 shares were repurchased under the Company's share buyback programme
at a cost of £147m, including costs of £1m associated with the transfer to the Company of the
repurchased shares and their subsequent cancellation. The cost of the share buyback has
been charged to retained earnings. An amount of £2m, equivalent to the nominal value of the
cancelled shares, was transferred to the capital redemption reserve. In 2023, no shares were
repurchased under the Company’s share buyback programme.
The Group had a contract in place with a broker to purchase its own shares for cash in
connection with the £150m buyback announced on 30 July 2024. The non-cancellable
component of the contract gives rise to an additional financial liability as at 31 December 2024
of £4m (2023: £nil) which has been charged to retained earnings.
b) Substantial shareholdings
Details of substantial interests in the Company’s issued ordinary share capital received by the
Company at 3 March 2025 under the provisions of the Companies Act 2006 have been
disclosed in the significant shareholdings section of the Corporate Governance Report.
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24 Share capital continued
c) Share options
At 31 December 2024, options to acquire ordinary shares of 10.0p each in the Company up to
the following numbers under the schemes below were outstanding as follows:
Number of ordinary shares of 10.0p each
Exercisable until
Option price
(£)
The Inchcape SAYE Share Option Scheme - approved
32,884
1 May 2025
7.31
120,187
1 May 2026
6.00
119,945
1 May 2027
6.11
45,870
1 May 2028
6.80
Included within the retained earnings reserve are 322,859 ordinary shares (2023: 1,008,058
ordinary shares) in the Company held by the Inchcape Employee Trust, a general discretionary
trust whose beneficiaries include current and former employees of the Group and their
dependants.
The book value of these shares at 31 December 2024 was £3m (2023: £7m).
The market value of these shares at 31 December 2024 and 3 March 2025 was £2m and £2m
respectively (31 December 2023 and 4 March 2024: £7m).
d) Issue of Derco shares
On 4 January 2023, 38,513,102 ordinary shares of 10p each in the capital of the Company were
issued in connection with the acquisition of the Derco group.
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25 Other reserves
Merger
reserve
Fair value
through OCI
reserve
Translation
reserve
Hedging
reserve
Total other
reserves
£m
£m
£m
£m
£m
At 1 January 2023
316
(2)
74
(3)
385
Comprehensive income/(loss)
Cash flow hedges:
– net fair value losses
—
—
—
(45)
(45)
– tax on cash flow hedges
—
—
—
17
17
Investments held at fair value:
– net fair value losses
—
(3)
—
—
(3)
Deferred tax on taxation losses
—
—
—
(1)
(1)
Exchange differences on translation of
foreign operations
—
—
(131)
—
(131)
Recycling of foreign currency reserve
—
—
(1)
—
(1)
Adjustments in respect of hyperinflation
—
—
34
—
34
Other changes in equity
Shares issued
(4)
—
—
—
(4)
Cash flow hedges reclassified and reported in inventories
—
—
—
(2)
(2)
At 1 January 2024
312
(5)
(24)
(34)
249
Comprehensive income/(loss)
—
Cash flow hedges:
– net fair value gains
—
—
—
20
20
– tax on cash flow hedges
—
—
—
(14)
(14)
Investments held at fair value:
– net fair value gains
—
3
—
—
3
Deferred tax on taxation losses
—
—
—
—
—
Exchange differences on translation of foreign operations
—
—
(242)
—
(242)
Recycling of foreign currency reserve
—
—
(4)
—
(4)
Adjustments for hyperinflation (including tax)
—
—
(4)
—
(4)
Other changes in equity
Cash flow hedges reclassified and reported in inventories
—
—
—
19
19
At 31 December 2024
312
(2)
(274)
(9)
27
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25 Other reserves continued
Fair value through OCI reserve
For investments in equity instruments that are measured at fair value through other
comprehensive income, changes in fair value are recognised through other comprehensive
income. Fair value movements are never recycled to the income statement, even if the
underlying asset is sold, impaired or otherwise derecognised.
Translation reserve
The translation reserve is used to record foreign exchange rate changes relating to the
translation of the results of foreign subsidiaries arising after 1 January 2004. It is also used to
record foreign exchange differences arising on long-term foreign currency borrowings used to
finance or hedge foreign currency investments. The effect of foreign exchange rate changes
includes a gain of £4m (2023: £1m) on the sale and liquidation of overseas subsidiaries that has
been reclassified to the consolidated income statement in accordance with IAS 21 The Effects
of Changes in Foreign Exchange Rates. The adjustments in respect of hyperinflation relate to
the application of IAS 29 Financial Reporting in Hyperinflationary Economies to the Group’s
operations in Ethiopia. The indexation and translational impact (net of tax) to opening share
capital and retained earnings of £4m (2023: £34m) has been included in translation
reserves above.
Hedging reserve
For cash flow hedges that meet the conditions for hedge accounting, the portion of the gains
or losses on the hedging instrument that are determined to be an effective hedge are
recognised directly in other comprehensive income. When the hedged firm commitment
results in the recognition of a non-financial asset or liability then, at the time the asset or liability
is recognised, the associated gains or losses that had previously been recognised in
shareholders’ equity are included in the initial measurement of the acquisition cost or other
carrying amount of the asset or liability.
Merger reserve
As part of the acquisition of the Derco group of companies in 2022, Inchcape plc issued
38,513,102 shares in exchange for a greater than 90% equity holding in another company and
merger relief was therefore applicable. Consequently, the excess of the fair value of the shares
issued over their nominal value was recognised in a merger reserve within equity.
26 Retained earnings
2024
2023
£m
£m
At 1 January
940
820
Comprehensive income/(loss)
– Profit for the year
421
270
– Actuarial losses on defined pension benefits (including tax) (see note 5)
(47)
(20)
Total comprehensive income attributable to owners of the parent
374
250
Other changes in equity
Written put option
—
(1)
Acquisition of non-controlling interests
—
3
Share-based payments, net of tax
18
15
Share buyback programme
(151)
—
Purchase of own shares by Inchcape Employee Trust
(14)
(19)
Dividends paid (see note 9)
(147)
(128)
At 31 December
1,020
940
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27 Notes to the consolidated statement of cash flows
a) Reconciliation of cash generated from operations
2024
2023
£m
£m
Cash flows from operating activities
Operating profit – continuing operations
562
570
Operating profit – discontinued operations
6
49
Adjusting items
22
50
Amortisation including non-adjusting impairment charges
9
11
Depreciation of property, plant and equipment including non-adjusting
impairment charges
44
61
Depreciation of right-of-use assets
76
81
Profit on disposal of property, plant and equipment and intangible assets
(1)
(16)
Gain on changes in right-of-use assets
(3)
—
Share-based payments charge
18
15
Decrease/(increase) in inventories
311
(251)
Increase in trade and other receivables
(121)
(9)
Increase in trade and other payables
13
415
Decrease in provisions
(20)
(1)
Pension contributions more than pension charge for the period
—
(1)
Increase in interest in leased vehicles
(8)
(18)
Payments in respect of operating adjusting items
(36)
(57)
Other non-cash items
1
1
Cash generated from operations
873
900
b) Net debt reconciliation
Liabilities from financing activities
Assets
Borrowings
Leases
Sub-total
Cash/bank
overdrafts
Total
net debt
£m
£m
£m
£m
£m
Net debt at 1 January 2023
(1,428)
(499)
(1,927)
1,050
(877)
Cash flows
412
87
499
(400)
99
Acquisitions
(23)
(11)
(34)
(146)
(180)
Period adjustments
(7)
(1)
(8)
9
1
Disposals
—
—
—
1
1
New lease liabilities
—
(37)
(37)
—
(37)
Other non-cash movements
(6)
—
(6)
—
(6)
Foreign exchange adjustments
11
21
32
(74)
(42)
Net debt at 1 January 2024
(1,041)
(440)
(1,481)
440
(1,041)
Cash flows
484
81
565
(372)
193
Acquisitions
—
—
—
5
5
Disposals
—
98
98
391
489
New lease liabilities
—
(62)
(62)
—
(62)
Other non-cash movements
(4)
(1)
(5)
—
(5)
Foreign exchange adjustments
5
22
27
(98)
(71)
Net debt at 31 December 2024
(556)
(302)
(858)
366
(492)
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27 Notes to the consolidated statement of cash flows continued
Net debt is analysed as follows:
2024
2023
£m
£m
Cash at bank and short term deposits as per the statement of financial
position
549
689
Cash and cash equivalents included in disposal groups held for sale
—
Borrowings – disclosed as current liabilities
(195)
(652)
Add back: amounts treated as debt financing (see below)
12
403
Cash and cash equivalents as per the statement of cash flows
366
440
Debt financing
Borrowings – disclosed as current liabilities and treated as debt financing
(see above)
(12)
(403)
Borrowings – disclosed as non-current liabilities
(544)
(638)
Lease liabilities
(302)
(440)
Debt financing
(858)
(1,481)
Net debt
(492)
(1,041)
Add back: lease liabilities
302
440
Adjusted net debt
(190)
(601)
28 Acquisitions and disposals
a) 2024 Disposals and discontinued operations
On 1 August 2024 the Group completed the sale of its UK Retail operations to Group 1
Automotive UK Limited, a wholly-owned subsidiary of Group 1 Automotive, Inc. for a cash
consideration of £345m.
The UK Retail operation is reported in the current period as a discontinued operation. Financial
information relating to the discontinued operation for the period to the date of disposal is set
out below.
Financial performance and cash flow information
The financial performance and cash flow information presented below is for the seven months
ended 31 July 2024.
2024
2023
£m
£m
Revenue
1,199
2,065
Expenses
(1,193)
(2,016)
Operating profit
6
49
Finance costs
(9)
(14)
Profit before tax
(3)
35
Tax
7
—
Profit after tax of discontinued operations
4
35
Gain on disposal
146
—
Profit from discontinued operation
150
35
2024
2023
£m
£m
Net cash inflow from operating activities
6
30
Net cash outflow from investing activities
(10)
(15)
Net cash outflow from financing activities
(3)
(7)
Net (decrease)/increase from cash generated from discontinued
operations
(7)
8
2024
£m
Disposal proceeds
345
Settlement of intercompany facility
63
Disposal costs
(12)
Net assets disposed of
(250)
Gain on disposal
146
2024
£m
Total consideration, net of disposal costs paid
396
Consideration outstanding
(4)
Cash & cash equivalents disposed of
(20)
Net cash inflow on disposal of business
372
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28 Acquisitions and disposals continued
In December 2024, the Group completed the sale of its non-genuine parts business in Chile for
£30m, resulting in a £6m gain on disposal. The net gain, which has been classified as an
adjusting item (see note 2), includes disposal costs and a gain relating to the recycling of
cumulative exchange differences previously recognised in other comprehensive income.
b) 2023 Acquisitions
During the year, net cash inflows of £5m were received as purchase price adjustments were
finalised in relation to acquisitions which completed in the second half of 2023. The accounting
standards allow a period of up to a year to finalise the accounting for an acquisition. During
2024, acquisition adjustments were made, in relation to businesses acquired in 2023, which,
combined with purchase price adjustments, had the net effect of decreasing goodwill by £1m.
As the acquisition adjustments were not material, the prior year statement of financial position
has not been restated.
29 Guarantees and contingencies
2024
2023
£m
£m
(represented)1
Guarantees
7
16
Letters of credit
19
24
26
40
1. Prior year amounts have been represented for consistency with the current year disclosure and exclude
amounts already recognised on the statement of financial position.
Guarantees relate to performance guarantees provided in the ordinary course of business.
Letters of credit act as a guarantee, from one of the Group’s banking relationships to another
bank, for payments made by the Group to a specified third party. The Group also has, in the
ordinary course of business, commitments under foreign exchange instruments relating to the
hedging of transactional exposures (see note 23).
Franked Investment Income Group Litigation Order
The Group is a participant in an action in the United Kingdom against HMRC in the Franked
Investment Income Group Litigation Order (“FII GLO”). As at 31 December 2024, there were 15
corporate groups in the FII GLO. As previously reported, the High Court held in February 2024
that for claims for a refund of the unlawfully paid tax to cover the entire period of claims they
must have been submitted before 6 June 2006. The Group submitted a claim on 25 November
2003 and the High Court’s judgment means that the Group’s claim is within time to cover the
entire period of its claim. However, the Court of Appeal has granted HMRC leave to appeal
the High Court’s decision and this hearing has been scheduled for May 2025.
In view of the significant uncertainty about the eventual outcome of the appeals process, the
Group has not recognised a contingent asset in respect of this litigation.
FCA review of Motor Finance commission
In January 2024, the FCA announced a review into historical motor finance commission
arrangements. This investigation is ongoing. In the meantime, there have also been a number
of relevant court decisions with the Supreme Court expected to deliver a definitive statement
of the law following a hearing listed for April 2025. We look forward to the outcome of the
review, and of the Supreme Court hearing, and the clarity that this will bring for customers,
lenders and dealers. Following the Group’s disposal of its UK business, the Group’s potential
exposure to this matter arises from, and is limited to, the terms of the indemnity that it has given
to the buyer of that business. It remains possible, though highly uncertain, that the Group may
become liable to make certain payments under the terms of that indemnity. However, it is not
currently practicable to estimate the quantum or timing of any such outflow given the inherent
uncertainties associated with the court process and the s166 review.
Other contingencies
There are also a number of other contingent liabilities that arise in the normal course of
business, which if realised, are not expected to result in a material liability to the Group.
30 Commitments
a) Capital commitments
Contracts placed for future capital expenditure at the balance sheet date but not yet incurred
are as follows:
2024
2023
£m
£m
Property, plant and equipment
1
19
b) Lease commitments
Short-term lease commitments – Group as lessee
Future minimum lease payments for short-term leases under non-cancellable operating leases
are as follows:
2024
2023
£m
£m
Within one year
1
3
Operating leases – Group as lessor
The Group has entered into non-cancellable operating leases on a number of its vehicles and
certain properties. These leases have varying terms, escalation clauses and renewal rights and
are not individually significant to the Group.
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30 Commitments continued
Future minimum lease payments receivable under non-cancellable operating leases are as
follows:
2024
2023
£m
£m
Within one year
5
4
Between one and five years
5
5
Total
10
9
Sub-lease receivables – Group as lessor
The Group has entered into sub-leases for a number of properties and other assets. As the lease
term represents a major proportion of the underlying asset’s useful life, the associated right-of-
use asset has been derecognised and replaced with a sub-lease receivable. Future minimum
lease payments receivable under sub-leases, together with the present value of the net
minimum lease payments receivable (included within trade and other receivables), are as
follows:
2024
2023
£m
£m
Minimum lease payments receivable:
– Within one year
2
3
– Between one and five years
1
5
– After five years
—
2
Total minimum lease payments receivable
3
10
Less: Unearned finance income
—
—
Present value of sub-lease receivables
3
10
c) Repurchase commitments
The Group has entered into agreements with certain customers to repurchase vehicles for a
specified value at a predetermined date as follows:
2024
2023
£m
£m
Vehicles subject to repurchase commitments
112
151
Repurchase commitments represent the total repurchase liability on all vehicles where the
Group has a repurchase commitment. These commitments are largely expected to be settled
over the next three years. £17m (2023: £42m) of the above repurchase commitments are
included within ‘trade and other payables’ in the consolidated statement of financial position.
31 Related party disclosures
a) Trading transactions
Intra-group transactions have been eliminated on consolidation and are not disclosed in this
note. Details of transactions between the Group and other related parties are disclosed below:
Transactions
Amounts outstanding
2024
2023
2024
2023
£m
£m
£m
£m
Other income paid to related parties
1
1
—
—
Sales to related parties1
4
—
1
—
Lease payments made to related parties1,2
(7)
(7)
(41)
(46)
Other income received from joint ventures
21
18
5
2
1. These transactions are with entities connected to Non-Executive Directors.
2. Amounts outstanding in respect of lease payments to related parties include all undiscounted future
payment commitments.
All of the transactions arise in the ordinary course of business and are on an arm’s length basis.
The amounts outstanding are unsecured and will be settled in cash. There have been no
guarantees provided or received for any related party receivables. The Group has not raised
any provision for doubtful debts relating to amounts owed by related parties (2023: £nil).
b) Compensation of key management personnel
The remuneration of the Board of Directors and the Executive Committee was as follows:
2024
2023
£m
£m
Wages and salaries1
9
9
Share-based payments
8
6
17
15
1. Other pension costs included in wages and salaries amount to £0.3m (2023: £0.3m).
The remuneration of the Directors and other key management is determined by the
Remuneration Committee having regard to the performance of individuals and market trends.
Further details of emoluments paid to the Directors are included in the Directors’ Report
on Remuneration.
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32 Foreign currency translation
The main exchange rates used for translation purposes are as follows:
Average rates
Year-end rates
2024
2023
2024
2023
£m
£m
£m
£m
Australian dollar
1.94
1.88
2.02
1.87
Bolivian bolivar1
12.43
8.60
14.24
8.83
Chilean peso
1,209.30 1,044.70
1,252.30 1,130.41
Ethiopian birr2
157.95
71.84
157.95
71.84
Euro
1.18
1.15
1.21
1.15
Hong Kong dollar
9.99
9.75
9.75
9.98
Singapore dollar
1.71
1.67
1.71
1.68
US dollar
1.28
1.25
1.26
1.28
1. In 2024, a parallel rate has been used due to limitations in accessing currency at official rates of
exchange.
2. In 2024, the results for Ethiopia are translated at the closing rate as required by IAS 21 The Effects of
Changes in Foreign Exchange Rates for hyperinflationary foreign operations.
33 Events after the reporting period
On 4 March 2025, the Board approved a £250m share buyback programme which will
commence on 4 March 2025 and is expected to conclude within the next 12 months.
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Alternative Performance Measures (APMs)
The Group assesses its performance using a variety of alternative performance measures which are not defined under International Financial Reporting Standards. These provide insight into how
the Board and Executive Committee monitor the Group’s strategic and financial performance, and provide useful information on the trends, performance, and position of the Group.
The Group’s income statement and segmental analysis identify separately adjusted measures and adjusting items. These adjusted measures reflect adjustments to IFRS measures. The Directors
consider these adjusted measures to be an informative additional measure of the ongoing trading performance of the Group. Adjusted results are stated before adjusting items and on a
continuing operations basis.
Adjusting items can include gains or losses on the disposal of businesses, restructuring of businesses, acquisition costs, asset impairments and the tax effects of these items. Adjusting items
excluded from adjusted results can evolve from one financial period to the next depending on the nature of adjusting items or one-off activities.
Constant currency
Some comparative performance measures are translated at constant exchange rates, called ‘constant currency’ measures. This restates the prior period results at a common exchange rate to
the current period and therefore excludes the impact of changes in exchange rates used for translation.
Adjusted gross profit
Gross profit before adjusting items.
Refer to the consolidated income statement
A key metric of the direct profit contribution from the Group’s revenue
streams (e.g. Vehicles
and Aftersales).
Adjusted operating profit
Operating profit before adjusting items.
Refer to the consolidated income statement.
A key metric of the Group’s business performance.
Adjusted operating margin
Adjusted operating profit divided by revenue.
A key metric of operational efficiency, ensuring that we are leveraging
global scale to translate sales growth into profit.
Adjusted profit before tax
Represents the profit made after operating and interest expense excluding
the impact of adjusting items and before tax is charged.
Refer to consolidated income statement.
A key driver of delivering sustainable and growing earnings to shareholders.
Adjusted earnings before interest,
tax, depreciation and
amortisation
Represents the earnings before interest expense, taxation, depreciation and
amortisation expenses, and excluding the impact of adjusting items.
One of the key measures used in monitoring the Group’s leverage and
capital allocation. Refer to note 23.
Adjusting items
Items that are charged or credited in the consolidated income statement
which are material and non-recurring in nature. Refer to note 2.
The separate reporting of adjusting items helps provide additional useful
information regarding the Group’s business performance and is consistent
with the way that financial performance is measured by the Board and the
Executive Committee.
Adjusted earnings
Represents profit after tax, excluding the impact of adjusting items and non-
controlling interest.
Refer to consolidated income statement.
A key driver of delivering sustainable and growing earnings to shareholders.
Adjusted earnings per share
Represents earnings per share excluding the impact of adjusting items. Refer
to note 8.
A measure useful to shareholders and investors to understand the earnings
attributable to shareholders without the impact of adjusting items.
Ratio of adjusted net operating
expenses to revenue
Adjusted net operating expenses expressed as a proportion of revenue.
A measure of the net overheads of the Group with reference to Group
revenue.
Performance measure
Definition
Why we measure it
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Net capital expenditure
Cash outflows from the purchase of property, plant and equipment and
intangible assets less the proceeds from the disposal of property, plant and
equipment and intangible assets.
A measure of the net amount invested in operational facilities in the period.
Free cash flow and free cash flow
from continuing operations
Net cash flows from operating activities, before adjusting cash flows, less
normalised net capital expenditure and dividends paid to non-controlling
interests. Free cash flow from continuing operations is derived by deducting
free cash flow attributable to discontinued operations from total free
cash flow.
A key driver of the Group’s ability to ‘Invest to Accelerate Growth’ and to
make distributions to shareholders.
Free cash flow conversion
Free cash flow divided by adjusted profit after tax.
A key driver of the Group’s ability to ‘Invest to Accelerate Growth’ and to
make distributions to shareholders.
Return on capital employed
(ROCE)
Operating profit (before adjusting items) divided by the average of opening
and closing capital employed, where capital employed is defined as net
assets add net debt/less net funds.
ROCE is a measure of the Group’s ability to drive better returns for investors on
the capital we invest.
Net (debt)/funds
Cash and cash equivalents less borrowings and lease liabilities adjusted for
the fair value of derivatives that hedge interest rate or currency risk on
borrowings. Refer to note 27.
A measure of the Group’s net indebtedness that provides an indicator of the
overall balance sheet strength.
Adjusted (net debt)/net cash
Cash and cash equivalents less borrowings adjusted for the fair value of
derivatives that hedge interest rate or currency risk on borrowings and before
the incremental impact of IFRS 16 lease liabilities. Refer to note 27.
A measure of the Group’s net indebtedness that provides an indicator of the
overall balance sheet strength and is widely used by external parties.
Leverage
Adjusted net debt divided by adjusted earnings before interest, tax,
depreciation, and amortisation.
A measure of the Group’s net indebtedness with reference to adjusted
underlying earnings.
Constant currency % change
Presentation of reported results compared to prior period translated using
constant rates of exchange.
A measure of business performance which excludes the impact of changes
in exchange rates used for translation.
Organic revenue growth
Organic revenue growth is defined as the change in revenue adjusted for the
impact of business acquisitions and disposals and currency translation effects,
with prior year figures converted with current year exchange rates.
Organic revenue growth:
• excludes revenue from businesses acquired in the current year;
• includes revenue from businesses acquired in the prior year from the
anniversary of the date of acquisition;
• excludes revenue from businesses disposed of on a pro rata basis; and
• includes revenue from distribution contracts acquired together with the
impact of arrangements where the Group no longer acts as the distributor.
Organic revenue growth presents performance on a comparable basis,
excluding the impact of foreign currency translation and the impact of
acquisition and disposals in the period. Organic revenue growth is a measure
of underlying business performance and the Group’s ability to grow other
than through acquisitions.
Performance measure
Definition
Why we measure it
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Alternative Performance Measures (APMs) continued
2024
2023
Adjusted profit before tax (from continuing operations)
£m
£m
Gross Profit
1,606
1,660
Add back: Adjusting items charged to gross profit
—
—
Adjusted Gross Profit from continuing operations
1,606
1,660
Less: Segment operating expenses
(1,022)
(1,040)
Adjusted Operating Profit from continuing operations
584
620
Less: Adjusting items in operating expenses
(22)
(50)
Operating Profit
562
570
Less: Net Finance Costs and JV profits/losses
(148)
(192)
Profit Before Tax
414
378
Add: Total adjusting Items
30
89
Adjusted profit before tax from continuing operations
444
467
Tax on adjusted profit
(139)
(140)
Adjusted profit after tax from continuing operations
305
327
2024
2023
Ratio of adjusted net operating expenses to revenue
£m
£m
Revenue
9,263
9,382
Adjusted net operating expenses
1,022
1,040
Ratio of adjusted net operating expenses to revenue
11.0 %
11.1 %
2024
2024
2023
2023
Free cash flow (from continuing operations)
£m
£m
£m
£m
Net cash generated from total operating activities
586
593
Add back: Payments in respect of adjusting items
36
57
Net cash generated from operating activities, before
adjusting items
622
650
Purchase of property, plant and equipment
(76)
(88)
Purchase of intangible assets
(3)
(5)
Proceeds from disposal of property, plant and
equipment
9
31
Net capital expenditure
(70)
(62)
Net payment in relation to leases
(80)
(84)
Dividends paid to non-controlling interests
(17)
(6)
Free cash flow
455
498
Add/(less): Free cash outflow/(inflow) from
discontinued operations
7
(6)
Free cash flow from continuing operations
462
492
2024
2023
Return on capital employed (from continuing operations)
£m
£m
Adjusted operating profit
584
620
Net assets
1,474
1,620
Less: Net assets from discontinued operations
—
(224)
Net assets from continuing operations
1,474
1,396
Add: net debt
492
1,041
Less: net debt from discontinued operations
—
(58)
Capital employed - continuing operations
1,966
2,379
Effect of averaging
207
(108)
Average capital employed
2,173
2,271
Return on capital employed
26.9 %
27.3 %
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Alternative Performance Measures (APMs) continued
2024
2023
Adjusted net debt and leverage
£m
£m
Net debt
492
1,041
Less: lease liabilities
(302)
(440)
Adjusted net debt
190
601
Adjusted earnings before interest, tax, depreciation and amortisation
634
738
Leverage
0.3
0.8
2024
2023
Adjusted earnings per share (from continuing operations)
£m
£m
Adjusted profit after tax
305
327
Less: non-controlling interests
(14)
(13)
Adjusted earnings
291
314
Weighted average number of shares (m)
408
412
Diluted effect (m)
5
5
Basic adjusted earnings per share
71.3p
76.3p
Diluted adjusted earnings per share
70.4p
75.3p
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Five year record
The information presented in the table below is prepared in accordance with IFRS, as in issue
and effective at that year end date. The information presented is on a continuing operations
basis, however only years 2024 and 2023 have been adjusted to reflect the disposal of the UK
Retail business.
Consolidated income statement
£m
£m
£m
£m
£m
Revenue
9,263
9,382
8,133
6,901
6,838
Adjusted operating profit
584
620
411
281
164
Operating adjusting items
(22)
(50)
(11)
(100)
(257)
Operating profit/(loss)
562
570
400
181
(93)
Share of profit after tax of joint ventures
and associates
2
1
—
—
—
Profit/(loss) before finance and tax
564
571
400
181
(93)
Net finance costs before adjusting items
(142)
(154)
(38)
(32)
(37)
Adjusting finance costs
(8)
(39)
(29)
—
—
Profit/(loss) before tax
414
378
333
149
(130)
Tax on profit before adjusting items
(139)
(140)
(97)
(63)
(33)
Tax on adjusting items
10
10
(1)
(2)
24
Profit/(loss) after tax
285
248
235
84
(139)
(Loss)/profit from discontinued operations
150
35
(241)
38
—
Non-controlling interests
(14)
(13)
(5)
(5)
(3)
Profit/(loss) for the year attributable to
owners of the parent
421
270
(11)
117
(142)
Basic:
– Profit/(loss) for the year attributable to
owners of the parent
421
270
(11)
117
(130)
– Earnings/(loss) per share (pence)
66.4p
57.1p
(2.9)p
30.0p
(36.0)p
Adjusted (before adjusting items):
– Adjusted profit from continuing
operations
305
327
271
181
128
– Adjusted earnings per share (pence)
71.3p
76.3p
72.0p
46.3p
23.1p
Dividends per share – interim paid and
final proposed (pence)
28.5p
33.9p
28.8p
22.5p
6.9p
2024
2023
2022
2021
2020
Consolidated statement of financial
position
£m
£m
£m
£m
£m
Non-current assets
2,202
2,789
2,610
1,464
1,480
Other net liabilities excluding net (debt)/
funds
(236)
(128)
(166)
(388)
(352)
Capital employed
1,966
2,661
2,444
1,076
1,128
Net (debt)/funds
(492)
(1,041)
(877)
55
(67)
Net assets
1,474
1,620
1,567
1,131
1,061
Equity attributable to owners of the parent
1,379
1,521
1,533
1,109
1,042
Non-controlling interests
95
99
34
22
19
2024
2023
2022
2021
2020
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FIVE YEAR RECORD
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Non-current assets
Investment in subsidiaries
3
2,588
2,586
Deferred tax assets
8
3
10
Trade and other receivables
4
—
140
2,591
2,736
Current assets
Current tax assets
2
17
Trade and other receivables
4
5
81
Cash and cash equivalents
5
7
1
14
99
Total assets
2,605
2,835
Current liabilities
Trade and other payables
6
(18)
(22)
Borrowings
7
(128)
(320)
(146)
(342)
Non-current liabilities
Trade and other payables
6
(813)
(1,085)
Borrowings
7
(489)
(488)
(1,302)
(1,573)
Total liabilities
(1,448)
(1,915)
Net assets
1,157
920
Equity
Share capital
10
40
42
Share premium
147
147
Capital redemption reserve
145
143
Merger reserve
312
312
Retained earnings
513
276
Total shareholders’ funds
1,157
920
2024
2023
Notes
£m
£m
The Company reported a profit for the financial year ended 31 December 2024 of £531m
(2023: loss of £112m). The financial statements on pages 195 to 210 were approved by the
Board of Directors on 3 March 2025 and were signed on its behalf by:
Duncan Tait
Group Chief Executive
Adrian Lewis
Group Chief Financial Officer
Registered Number: 609782
Inchcape plc
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COMPANY STATEMENT OF FINANCIAL POSITION
As at 31 December 2024
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At 1 January 2023
38
147
143
316
520
1,164
Loss for the year
—
—
—
—
(112)
(112)
Total comprehensive expense for
the year
—
—
—
—
(112)
(112)
Dividends
11
—
—
—
—
(128)
(128)
Net purchase of own shares by the Inchcape Employee Trust
—
—
—
—
(19)
(19)
Share-based payments, net of tax
—
—
—
—
15
15
Shares issued
4
—
—
(4)
—
—
At 1 January 2024
42
147
143
312
276
920
Profit for the year
—
—
—
—
531
531
Total comprehensive income for
the year
—
—
—
—
531
531
Dividends
11
—
—
—
—
(147)
(147)
Share buyback programme
10
(2)
—
2
—
(151)
(151)
Net purchase of own shares by the Inchcape Employee Trust
—
—
—
—
(14)
(14)
Share-based payments, net of tax
—
—
—
—
18
18
At 31 December 2024
40
147
145
312
513
1,157
Share
capital
Share
Premium
Capital
redemption
reserve
Merger
reserve
Retained
earnings
Total
Notes
£m
£m
£m
£m
£m
£m
Share-based payments include a net tax charge of £nil (2023: £nil).
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COMPANY STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2024
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General information
These financial statements are prepared for Inchcape plc (the Company) for the year ended
31 December 2024. The Company is the ultimate parent entity of the Inchcape Group
(the Group) and acts as the holding company of the Group. The parent company financial
statements present information about the Company as a separate entity and not about
the Group.
Basis of preparation
These financial statements were prepared in accordance with Financial Reporting Standard
101 Reduced Disclosure Framework (FRS 101).
The financial statements are prepared under the historical cost convention in accordance with
the Companies Act 2006. As permitted by Section 408 of the Companies Act 2006, no separate
profit and loss account or statement of comprehensive income is presented for the Company.
The Company does not have any critical accounting judgements. The valuation of the
Company’s investments is a key source of estimation uncertainty. The Company’s net assets
were lower than its market capitalisation on 31 December 2024 and the estimates of the
recoverable amounts of the individual investments were in excess of their carrying values. As a
result, no impairment has been reflected. Other sources of estimation uncertainty most
applicable to the Company do not give rise to a significant risk of material adjustment to the
carrying value of the Company’s assets and liabilities.
The Directors of Inchcape plc manage the Group’s risks at a group level rather than an
individual business unit or company level. Further information on these risks and uncertainties,
in the context of the Group as a whole, are included within the Group disclosures on pages
52 to 61.
In preparing these financial statements, the Company applies the recognition, measurement,
and disclosure requirements of international accounting standards in conformity with the
requirements of the Companies Act 2006, but makes amendments where necessary in order to
comply with Companies Act 2006 and has set out below where advantage of the FRS 101
disclosure has been taken:
• Paragraphs 45(b) and 46 to 52 of IFRS 2, ‘Share-based payment’ (details of the number and
weighted average exercise price of share options, and how the fair value of goods and
services received was determined);
• IFRS 7, ‘Financial Instruments: Disclosures’;
• Paragraphs 91 to 99 of IFRS 13, ‘Fair value measurement’ (disclosure of valuation techniques
and inputs used for fair value measurement of assets and liabilities);
• Paragraph 38 of IAS 1, ‘Presentation of financial statements’ comparative information
requirements in respect of:
• paragraph 73(e) of IAS 16, ‘Property, plant and equipment’;
• paragraph 118(e) of IAS 38, ‘Intangible assets’ (reconciliations between the carrying amount
at the beginning and end of the period);
• The following paragraphs of IAS 1, ‘Presentation of financial statements’:
• 10(d) (statement of cash flows),
• 10(f) (a statement of financial position as at the beginning of the preceding period when
an entity applies an accounting policy retrospectively or makes a retrospective
restatement of items in its financial statements, or when it reclassifies items in its financial
statements),
• 16 (statement of compliance with all IFRS),
• 38A (requirement for minimum of two primary statements, including cash flow statements),
• 38B-D (additional comparative information),
• 40A-D (requirements for a third statement of financial position),
• 111 (cash flow statement information), and
• 134–136 (capital management disclosures)
• IAS 7, ‘Statement of cash flows’;
• Paragraph 30 and 31 of IAS 8, ‘Accounting policies, changes in accounting estimates and
errors’ (requirement for the disclosure of information when an entity has not applied a new
IFRS that has been issued but is not yet effective);
• Paragraph 17 of IAS 24, ‘Related party disclosures’ (key management compensation); and
• The requirements in IAS 24, ‘Related party disclosures’ to disclose related party transactions
entered into between two or more members of a group.
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ACCOUNTING POLICIES
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Going concern
Having assessed the principal risks and the other matters discussed in connection with the
viability statement, the Directors have considered it appropriate to adopt the going concern
basis of accounting in preparing the financial statements, as described in the Directors’ Report
of the consolidated Group Financial Statements.
Foreign currencies
Transactions in foreign currencies are translated into the functional currency at the rates of
exchange prevailing at the dates of the individual transactions. Monetary assets and liabilities
in foreign currencies are translated into sterling at closing rates of exchange and differences
are taken to the income statement. Non-monetary assets and liabilities that are measured in
terms of historical cost in a foreign currency are translated using the exchange rate at the date
of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that
are stated at fair value are retranslated to the functional currency at foreign exchange rates
ruling at the dates the fair value was determined. Foreign exchange differences arising on
translation are recognised in the profit and loss account.
Finance costs
Finance costs are recognised as an expense, calculated using the effective interest rate
method, in the period in which they are incurred.
Investments
Investments in subsidiaries are stated at cost, less provisions for impairment.
Impairment
The Company’s accounting policies in respect of the impairment of financial assets are
consistent with those of the Group. The carrying values of investments in subsidiary undertakings
are reviewed at each reporting date to determine whether there is any indication of
impairment. If any such indication exists, then the asset’s recoverable amount is estimated.
The Company’s impairment policies in relation to financial assets are consistent with those of
the Group, with additional consideration given to amounts owed by Group undertakings. Any
provision for impairment of receivables is based on lifetime expected credit losses. Lifetime
expected credit losses are calculated by assessing historical credit loss experience, adjusted for
factors specific to the receivable and company.
Deferred tax
Deferred income tax is accounted for using the liability method in respect of temporary
differences arising from differences between the tax bases of assets and liabilities and their
carrying amounts in the financial statements. Deferred tax liabilities are recognised for all
taxable temporary differences and deferred tax assets are recognised to the extent that it is
probable that taxable profits will be available against which deductible temporary differences
can be utilised. Such assets and liabilities are not recognised if the temporary difference is due
to the initial recognition of goodwill arising on a business combination, or to an asset or liability,
the initial recognition of which does not affect either taxable or accounting income.
Deferred tax liabilities are recognised for taxable temporary differences arising on investments
in subsidiaries, except where the Company is able to control the reversal of the temporary
difference and it is probable that the temporary difference will not reverse in the
foreseeable future.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the
asset is realised or the liability is settled using rates enacted or substantively enacted at the end
of the reporting period. Deferred tax is charged or credited in the income statement, except
when it relates to items credited or charged directly to shareholders’ equity, in which case the
deferred tax is also dealt with in shareholders’ equity.
Deferred tax assets and liabilities are only offset where there is a legally enforceable right to
offset current tax assets against current tax liabilities and if the deferred taxes relate to income
taxes levied by the same taxation authority.
Share capital
Ordinary shares are classified as equity.
Where the Company purchases its own equity share capital (treasury shares), the consideration
paid is deducted from shareholders’ funds until the shares are cancelled, reissued, or disposed
of. Where such shares are subsequently sold or reissued, any consideration received is included
in shareholders’ funds.
Dividends
Final dividends proposed by the Board of Directors and unpaid at the year-end are not
recognised in the financial statements until they have been approved by the shareholders at
the Annual General Meeting. Interim dividends are recognised when they are paid.
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Share-based payments
The Company operates various share-based award schemes. The fair value at the date at
which the share-based awards are granted is recognised in the income statement (together
with a corresponding credit in shareholders’ equity) on a straight-line basis over the vesting
period, based on an estimate of the number of shares that will eventually vest. At the end of
each reporting period, the Company revises its estimates of the number of awards that are
expected to vest. The impact of any revision is recognised in the income statement with a
corresponding adjustment to equity.
For equity-settled share-based awards, the services received from employees are measured by
reference to the fair value of the awards granted. With the exception of the Save As You Earn
scheme, the vesting of all share-based awards under all schemes is solely reliant upon non-
market conditions, therefore, no expense is recognised for awards that do not ultimately vest.
Where an employee cancels a Save As You Earn award, the charge for that award is
recognised as an expense immediately, even though the award does not vest.
The issue of shares by the Company to employees of its subsidiaries represents additional
capital contributions. When these costs are recharged to the subsidiary undertaking, the
investment balance is reduced accordingly.
Financial instruments
The Company’s policies on the recognition, measurement, and presentation of financial
instruments under IFRS 7 are the same as those set out in the Group’s accounting policies on
pages 131 to 141.
Financial guarantees
Where the Company enters into financial guarantee contracts to guarantee the indebtedness
of other companies within its Group, the Company considers these to be insurance
arrangements and accounts for them as such. In this respect, the Company treats the
guarantee contract as a contingent liability until such time as it becomes probable that the
Company will be required to make a payment under the guarantee.
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1 Auditor's remuneration
The Company incurred £0.1m (2023: £0.1m) in relation to UK statutory audit fees for the year
ended 31 December 2024.
2 Directors' remuneration
2024
2023
£m
£m
Wages and salaries
3
3
Social security costs
1
1
4
4
Further information on Executive Directors’ emoluments and interests is given in the Directors’
Report on Remuneration which can be found on pages 91 to106.
3 Investment in subsidiaries
2024
2023
£m
£m
Cost
At 1 January
2,641
2,402
Additions
105
239
At 31 December
2,746
2,641
Provisions
At 1 January
(55)
(55)
Impairment charge
(103)
—
At 31 December
(158)
(55)
Net book value
2,588
2,586
The Directors believe that the carrying value of the individual investments is supported by their
expected recoverable amount.
During 2024, the Company increased its investment in Inchcape Management (Services)
Limited, which was then subsequently impaired to ensure the carrying value of the investment
does not exceed its recoverable amount.
During 2023, the Company increased its investment in Inchcape International Holdings Limited
and St James’s Insurance Limited.
4 Trade and other receivables
2024
2023
£m
£m
Amounts due within one year
Amounts owed by Group undertakings
3
79
Other debtors
2
2
5
81
Amounts due after more than one year
Amounts owed by Group undertakings
—
140
—
140
Amounts owed by Group undertakings that are due within one year consist of current account
balances that are interest free and repayable on demand, as well as intercompany loans that
bear interest at rates linked to source currency base rates.
Amounts owed by Group undertakings that are due after more than one year bear interest at
rates linked to source currency base rates.
5 Cash and cash equivalents
2024
2023
£m
£m
Cash and cash equivalents
7
1
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NOTES TO THE FINANCIAL STATEMENTS
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6 Trade and other payables
2024
2023
£m
£m
Amounts due within one year
Amounts owed to Group undertakings
—
14
Other creditors
18
8
18
22
2024
2023
£m
£m
Amounts due after more than one year
Amounts owed to Group undertakings
813
1,085
813
1,085
Current amounts owed to Group undertakings are interest free and repayable on demand.
Non-current amounts are repayable between one and five years and bear interest at rates
linked to source currency base rates.
7 Borrowings
2024
2023
£m
£m
Amounts due within one year
Private placement
—
70
Borrowings
128
250
128
320
Amounts due after more than one year
Private placement
140
140
Borrowings
349
348
489
488
In December 2016, the Group concluded a Private Placement transaction raising £140m to
refinance existing US dollar Private Placement borrowings which matured in May 2017. The
amounts drawn under these facilities are as follows:
Maturity date
May 2027
May 2027
May 2029
Amount drawn
£30m
£70m
£40m
Fixed rate coupon
3.0%
3.1%
3.1%
As of 31 December 2024, the funding facilities of the Company consisted of sterling Private
Placement Loan Notes amounting to £140m (2023: £210m), a five-year bond of £350m at a
fixed coupon of 5% (2023: £50m) and a £1,200m revolving credit facility with a subsidiary.
During the year, the term loan facility of £250m was repaid following the disposal of the UK
Retail business.
The £350m public bond is held at amortised cost and had a fair value of £358m as at
31 December 2024 based on quoted prices, which is a level 1 valuation technique. The £140m
sterling Private Placement loan notes are held at amortised cost. They have a fair value of
£135m (calculated from discounted cash flow techniques obtained using discount rates from
observable market data, which is a level 2 valuation technique.
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NOTES TO THE FINANCIAL STATEMENTS CONTINUED
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Tax losses
Net deferred tax asset/(liabilities)
£m
At 1 January 2023
10
Charged to the income statement
—
At 1 January 2024
10
Charged to the income statement
(7)
At 31 December 2024
3
Deferred tax assets recognised are supported by those future taxable profits of the UK tax
group, headed by the Company, which are associated with the reversal of taxable
temporary differences.
9 Guarantees
The Company is party to composite cross guarantees between banks and its subsidiaries.
The Company’s exposure under these guarantees at 31 December 2024 was £7m (2023: £1m),
equal to the carrying value of its cash and cash equivalents at the end of the period (see note
5). In addition, the Company has given performance guarantees in the normal course of
business in respect of the obligations of Group undertakings amounting to £174m
(2023: £170m).
10 Share capital
a) Allotted, called up and fully paid up
2024
2023
2024
2023
Number
Number
£m
£m
Issued and fully paid ordinary shares
(nominal value of 10.0p each)
At 1 January
413,007,132 374,494,030
42
38
Shares issued
— 38,513,102
—
4
Cancelled under share buyback
(18,673,960)
—
(2)
—
At 31 December
394,333,172 413,007,132
40
42
b) Share buyback programme
In 2024, 18,673,960 shares were repurchased under the Company's share buyback programme
at a cost of £147m, including costs of £1m associated with the transfer to the Company of the
repurchased shares and their subsequent cancellation. The cost of the share buyback has
been charged to retained earnings. An amount of £2m, equivalent to the nominal value of the
cancelled shares, was transferred to the capital redemption reserve. In 2023, no shares were
repurchased under the Company’s share buyback programme.
The Group had a contract in place with a broker to purchase its own shares for cash in
connection with the £150m buyback announced on 30 July 2024. The non-cancellable
component of the contract gives rise to an additional financial liability as at 31 December 2024
of £4m (2023: £nil) which has been charged to retained earnings.
c) Substantial shareholdings
Details of substantial interests in the Company’s issued ordinary share capital received by the
Company at 3 March 2025 under the provisions of the Companies Act 2006 have been
disclosed in the significant shareholdings section of the Corporate Governance Report.
d) Share options
At 31 December 2024, options to acquire ordinary shares of 10.0p each in the Company up to
the following numbers under the schemes below were outstanding as follows:
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NOTES TO THE FINANCIAL STATEMENTS CONTINUED
8 Deferred tax
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202
Number of ordinary shares of 10.0p each
Exercisable until
Option price
(£)
The Inchcape SAYE Share Option Scheme – approved
32,884
1 May 2025
7.31
120,187
1 May 2026
6.00
119,945
1 May 2027
6.11
45,870
1 May 2028
6.80
Included within the retained earnings reserve are 322,859 ordinary shares (2023: 1,008,058
ordinary shares) in the Company held by the Inchcape Employee Trust, a general discretionary
trust whose beneficiaries include current and former employees of the Group and their
dependants. The book value of these shares at 31 December 2024 was £3m (2023: £7m).
The market value of these shares at 31 December 2024 and 3 March 2025 was £2m
(31 December 2023 and 4 March 2024: £7m).
e) Issue of Derco shares
On 4 January 2023, 38,513,102 ordinary shares of 10p each in the capital of the Company were
issued in connection with the acquisition of the Derco group.
f) Share-based remuneration
During the year, Inchcape plc had two employees, the Group Chief Executive, and the Group
Chief Financial Officer.
The terms and conditions of the Company’s share-based payment plans are detailed in the
Directors’ Report on Remuneration.
The charge arising from share-based transactions during the year was £3m (2023: charge of
£2m), all of which is equity-settled.
The weighted average exercise price of shares exercised during the period was £nil
(2023: £7.61).
The weighted average remaining contractual life for the share options outstanding at
31 December 2024 is 1.4 years (2023: 1.4 years) and the weighted average exercise price
for options outstanding at the end of the year was £6.57 (2023: £5.17).
11 Dividends
The following dividends were paid by the Company:
2024
2023
£m
£m
Final dividend for the year ended 31 December 2023 of 24.3p per share
(2022: 21.3p per share)
100
40
Interim dividend for the six months ended 30 June 2024 of 11.3p per share
(30 June 2023: 9.6p per share)
47
88
147
128
A final proposed dividend for the year ended 31 December 2024 of 17.2p per share is subject
to approval by shareholders at the Annual General Meeting and has not been included as a
liability as at 31 December 2024.
Inchcape Annual Report and Accounts 2024
Strategic report
Governance
Financial statements
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
10 Share capital continued
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203
In accordance with Section 409 of the Companies Act 2006 a full list of subsidiaries, associates,
and joint ventures as at 31 December 2024 is shown below:
Subsidiaries
Argentina
Torre Catalinas Plaza, Av. Eduardo Madero 900 Piso 17, Buenos Aires
Distribuidora Automotriz Argentina S.A.
100 %
Inchcape Argentina S.A.
100 %
Australia
Level 2, 4 Burbank Place, Baulkham Hills, NSW 2153
AutoNexus Pty Ltd
100 %
Bespoke Automotive Australia Pty Ltd
100 %
Inchcape Australia Ltd
(i)
100 %
Trivett Automotive Retail Pty Ltd
100 %
Inchcape European Automotive Pty Ltd
(ii)
100 %
SMLB Pty Ltd
100 %
Subaru (Aust) Pty Ltd
90 %
Trivett Automotive Group Pty Ltd
100 %
Trivett Bespoke Automotive Pty Ltd
100 %
Trivett Classic Garage Pty Ltd
100 %
Trivett Classic Holdings Pty Ltd
(iii)
100 %
Trivett Classic Pty Ltd
(iv)
100 %
Trivett Pty Ltd
100 %
Inchcape Automotive Australia Pty Limited
100 %
Inchcape Automotive Distribution Australia Pty Limited
100 %
PartsLane Pty Limited
100 %
Barbados
International Trading Centre, Warrens, St. Michael, Barbados, BB22026
Inchcape Caribbean Inc
100 %
Inchcape (Barbados) Inc
100 %
Name and registered address
Percentage
owned
Belgium
Leuvensesteenweg 369, 1932 Sint-Stevens-Woluwe
Autoproducts NV
100 %
Car Security NV
100 %
Toyota Belgium NV/SA
100 %
Inchcape Belgium Retail (formerly Garage Francorchamps SA)
100 %
Inchcape Belgium Distribution (formerly Inchcape Retail Belgium)
100 %
Bolivia
Avenue Cristobal de Mendoza No. 164 UV:14 Mzno:5 Bldg. Imcruz, Santa
Cruz
Imcruz Comercial S.A.
100 %
Corporación de Inversiones Imcruz Corp. S.A.
100 %
Inversiones Piraí S.R.L.
100 %
Imcruz Corredores de Seguros S.R.L.
100 %
Brunei Darussalam
KM3.6, Jalan Gadong, Bandar Seri Begawan
Champion Motors (Brunei) Sdn Bhd
70 %
NBT (Brunei) Sdn Bhd
70 %
Inchcape (B) Sdn Bhd
100 %
Bravoauto Sdn Bhd
100 %
Inchcape Services Sdn Bhd
70 %
Bulgaria
163 Tsarigradsko Shosse Str, Sofia
Inchcape Brokerage Bulgaria EOOD
100 %
TM Auto EOOD
100 %
Toyota Balkans EOOD
100 %
Name and registered address
Percentage
owned
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Financial statements
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
12 Related undertakings
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Cayman Islands
c/o JTC (Cayman) Limited P.O. Box 30745, 94 Solaris Avenue, 2nd Floor,
Camana Bay, Grand Cayman, KY1-1203
Interamericana Trading Corp.
100 %
Chile
Av. La Dehesa 265, Ciudad Santiago comuna Lo Barnechea Región
Metropolitana
Universal Motors SpA
100 %
Williamson Balfour Motors S.A.
100 %
Williamson Balfour S.A.
100 %
Inchcape Digital Delivery Centre Santiago SpA
100 %
Ruta 5 Norte #19100 Ciudad Santiago comuna Lampa Región
Metropolitana
Hino Chile S.A.
100 %
Inchcape Camiones y Buses Chile S.A.
100 %
Avda. Las Condes 11774, Vitacura, Santiago
Inchcape Latam Internacional S.A.
100 %
Inchcape Automotriz Chile S.A.
100 %
Indigo Chile Holdings SpA
100 %
Av. Vitacura #5410, Vitacura, Santiago
Inchcape Commercial Chile S.A.
100 %
Av. Raul Labbe #12981, comuna Lo Barnechea Región Metropolitana
Comercializadora Ditec Automoviles S.A.
100 %
Comercial Automoviles Raul Labbe S.A.
100 %
Alonso de Córdova 4125, office 403, Vitacura, Santiago
Dercorp CL SpA
100 %
Name and registered address
Percentage
owned
Chile (continued)
Av. Americo Vespucio 1842, Quilicura, Santiago
Promac SpA
100 %
Importadora y Distribuidora Alameda SpA
100 %
Dercomaq SpA
100 %
Comesa S.A.
100 %
Inversiones Derco Internacional SpA
100 %
Derco Inversiones SpA
100 %
Dercolatina SpA
100 %
Sociedad Corredora de Seguros Derco SpA
100 %
Dercocenter SpA
100 %
Derco SpA
100 %
Servicios Operacionales Comerciales y Administrativos SpA
100 %
Colombia
Calle 99 N° 69c – 41 Bogotá
Inchcape Digital Delivery Centre Colombia S.A.S
100 %
Matrase S.A.S
100 %
Inchcape Colombia S.A.S
100 %
Inmobiliaria Inchcape Colombia S.A.S
100 %
Inchcape Global Business Services S.A.S
100 %
Vuelta Grande a 150 metros de la Glorieta de Siberia via Cota-Chia CLIS
BG34
Distribuidora Hino de Colombia S.A.S.
100 %
Chía, Cundinamarca, Colombia
Derco Colombia S.A.S.
100 %
Derco Agencia de Seguros LTDA
100 %
Name and registered address
Percentage
owned
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NOTES TO THE FINANCIAL STATEMENTS CONTINUED
12 RELATED UNDERTAKINGS continued
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Cook Islands
First Floor, BCI House, Avarua, Rarotonga
IB Enterprises Ltd
100 %
Costa Rica
La Uruca, de la Pozuelo 200 metros oeste, frente al Hospital Mexico
Arienda Express S.A.
100 %
Inchcape Protection Express Sociedad Agencia de Seguros S.A.
100 %
Vehiculos de Trabajo S.A.
100 %
Vistas de Guanacaste Orquideas S.A.
100 %
Djibouti
Route de Venise – Djibouti Free Zone – PO Box 2645
Red Sea Automotive FZCO
100 %
Inchcape Djibouti Automotive SARL
98 %
Ecuador
Av. 10 de Agosto N36-226 y Naciones Unidas, Quito, 170507
Autolider Ecuador S.A.S
100 %
El Salvador
Boulevard Luis Poma y Calle Llama del Bosque Pte. #1, Urb. Madreselva,
Antiguo Cuscatlán, La Libertad
Inchcape El Salvador, S.A. de C.V.
100 %
Estonia
Läike tee 38, Peetri küla, Rae vald, Harjumaa 75312
Inchcape Motors Estonia OÜ
100 %
Ethiopia
Bole Sub City, Kebele 03, H.Nr. 2441, Addis Ababa
The Motor & Engineering Company Of Ethiopia (Moenco) S.C.
94 %
Finland
Ansatie 6 a C, 01740 Vantaa, Kotipaikka, Helsinki
Inchcape Motors Finland Oy
100 %
Inchcape Retail Finland Oy
100 %
Inchcape JLR Finland Oy
70 %
Name and registered address
Percentage
owned
Greece
48 Ethnikis Antistaseos Street, Halandri 15231
British Providence SA
100 %
Eurolease Fleet Services SA
100 %
Toyota Hellas SA
100 %
Polis Inchcape Athens SA
100 %
Guam
443 South Marine Corps Drive, Tamuning, Guam 96913
Atkins Kroll Inc
100 %
197 Ypao Road, Tamuning , Guam 96913
Morrico Holdings, Inc
100 %
Morrico Equipment LLC
100 %
Guatemala
20 Calle 10–91, Zona 10, Guatemala, Guatemala
Inchcape Guatemala S.A.
100 %
Honduras
Penthouse Edificio Torre Mayab, Colonia Loas del Mayab, Avenida
Republica de Costa Rica,Tegucigalpa
Inchcape Honduras S.A.
100 %
Hong Kong
11/F, Tower B, Manulife Financial Centre, 223–231 Wai Yip Street, Kwun
Tong, Kowloon
100 %
British Motors Ltd
100 %
Crown Motors Ltd
100 %
Future Motors Ltd
100 %
Inchcape Finance (HK) Ltd
100 %
Inchcape Hong Kong Ltd
100 %
Inchcape Mobility Limited
100 %
Inchcape Motor Services Ltd
100 %
Mega EV Ltd
100 %
Nova Motors Ltd
100 %
Name and registered address
Percentage
owned
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Financial statements
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
12 RELATED UNDERTAKINGS continued
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Indonesia
Indomobil Tower, 19th Floor, JI. Mt Haryono no 11, Bidara Cina, Jakarta,
Timur
PT JLM Auto Indonesia
60 %
Sequis Tower, 7th Floor, JI. Jendral Sudirman Kav. 71, South Jakarta 12190
PT Inchcape Automotive Indonesia
100 %
PT Inchcape Indomobil Distribution Indonesia
70 %
PT Inchcape Indomobil Energi Baru
70 %
PT Inchcape Indomobil Energi Baru Distribusi
70 %
Wanaherang, Gunung Putri, Bogor, West Java
PT Inchcape Indomobil Manufacturing Indonesia
70 %
Ivory Coast
01 BP 3893, Abidjan O1
Distribution Services Cote d’Ivoire SA
100 %
Toyota Services Afrique SA
100 %
Kenya
LR 1870/X/126, Ground Floor, Oracle Towers, Waiyaki Way, P.O. Box 2231–
00606, Nairobi
Inchcape Kenya Ltd
100 %
Latvia
4a Skanstes Street, Riga, LV–1013
Inchcape Insurance Services SIA
100 %
Inchcape Motors Latvia SIA
100 %
Inchcape JLR Baltics SIA
70 %
Lithuania
Laisves av. 137, Vilnius, LT–06118
UAB Autovista
67 %
UAB Inchcape Motors
67 %
Ozo str. 10A, Vilnius, LT–08200
UAB Krasta Auto
100 %
Name and registered address
Percentage
owned
Macau
Avenida do Coronel Mesquita, No 48–48D, Edf. Industrial Man Kei R/C,
Macau
Future Motors (Macao) Ltd
100 %
Yat Fung Motors Ltd
100 %
Netherlands
Gustav Mahlerlaan 1212, 1081 LA Amsterdam, the Netherlands
Inchcape International Group BV
(i)
100 %
New Zealand
Bell Gully, Level 22, Vero Centre, 48 Shortland Street, Auckland, 1010, New
Zealand
Inchcape Motors New Zealand Ltd
100 %
Inchcape Automotive Distribution (NZ) Ltd
100 %
Inchcape Automotive Retail (NZ) Ltd
100 %
Inchcape New Zealand Ltd
100 %
North Macedonia
21 8th September Boulevard, 1000 Skopje
Toyota Auto Center DOOEL
100 %
Panama
Vía General Nicanor A. de Obarrio (Street 50), Plaza Bancomer
lIaother S.A.
100 %
Ilachile S.A.
100 %
Ciudad de Panamá, Vía Cincuentenario Andrés Mojica, Ave. 6ta B., Lote
X 5B, Corregimiento de San Francisco, Distrito de Panamá, Provincia de
Panamá
Arrendadora Automotriz S.A.
100 %
Motores Japoneses S.A.
100 %
Lopez, Lopez & Associates, 53rd street Marbella, World Trade Center, 5th
floor, suite 502, Panama City
Isthmus Exchange S.A.
100 %
Name and registered address
Percentage
owned
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Financial statements
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
12 RELATED UNDERTAKINGS continued
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207
Peru
Av. El Polo Nro. 1117, Santiago de Surco, Lima
Inchcape Motors Peru S.A.
100 %
Av. Republica de Panama Nro. 3330, San Isidro, Lima
IMP Distribuidora S.A.
100 %
Av. Morro Solar 812, Santiago de Surco, Lima
Autocar del Peru S.A.
100 %
Distribuidora Automotriz del Peru S.A.
100 %
Inchcape Latam Peru S.A.
100 %
Rentas e Inmobiliaria Sur Andina S.A.
100 %
Av. Manuel Olguin 325, Santiago de Surco, Lima
Derco Perú S.A.
100 %
Dercocenter S.A.C.
100 %
Corporación Andina de Negocios S.A.
100 %
Philippines
28F Robinsons Cyberscape Gamma, Topaz and Ruby Roads, Ortigas
Center, San Antonio, Pasig Cit, Second District, NCR, 1605
Inchcape Digital Delivery Center Philippines Inc.
100 %
Block 8, Lot 2, 5th Avenue corner 24th Street, Bonifacio Global City, Fort
Bonifacio, Taguig City 1630
IC Automotive Inc
60 %
IC Land Automotive Inc
60 %
IC Star Automotive Inc
60 %
E. Rogriguez Jr. Avenue corner Carlo J. Caparas, Ugong, Pasig City 1604
ICATS Asian Motors Inc
60 %
Name and registered address
Percentage
owned
Philippines (continued)
1008 EDSA Greenhills, Second District, City of San Juan, NCR, 1502
ICATS British Motors Inc
60 %
ICATS Motorcycles Inc
60 %
ICATS Motors Inc
60 %
Poland
Al. Prymasa Tysiąclecia 64, 01–424 Warszawa
Inchcape Motors Polska Sp z.o.o
100 %
Al. Karkonoska 61, 53–015 Wroclaw
Interim Cars Sp z.o.o
100 %
Ul. Lopuzanska 38 B, 02–232 Warszawa
Inchcape JLR Poland Sp. Z.o.o
70 %
Puerto Rico
Sabana Gardens Industrial Park Calle B Lotes 6 al 9a, Carolina, PR 00983
and PO Box 29718, San Juan, PR 00924–0092
Millenium Sales and Services, Inc.
100 %
K.I. Investments Inc.
100 %
Inchcape Puerto Rico, Inc
100 %
Romania
Pipera Boulevard No 1, Voluntari, Ilfov, 077190
Inchcape Motors Srl
100 %
Toyota Romania Srl
100 %
Inchcape Broker de Asigurare Srl
100 %
Inchcape Bravoauto Srl
100 %
Saipan
San Jose Village, 1 Chalan Monsignor Guerrero, Saipan, 96950, Northern
Mariana Islands
Atkins Kroll (Saipan) Inc
100 %
Name and registered address
Percentage
owned
Inchcape Annual Report and Accounts 2024
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Governance
Financial statements
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
12 RELATED UNDERTAKINGS continued
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208
Singapore
2 Pandan Crescent, Inchcape Centre, Singapore 128462
Borneo Motors (Singapore) Pte Ltd
100 %
Century Motors (Singapore) Pte Ltd
100 %
Champion Motors (1975) Pte Ltd
100 %
Inchcape Automotive Services Pte Ltd
100 %
Inchcape Motors Private Ltd
100 %
Inchcape+ Pte Ltd
100 %
Spain
C. De Don Ramon de la Cruz, 38, 28001 Madrid
Inchcape Inversiones España S.L.
100 %
Tanzania
AFED Business Park, JK Nyerere Rd, PO.Box 21885, Dar Es Salaam
Inchcape Automotive Limited
100 %
Thailand
No. 4332 Rama IV Road, Prakhanong Sub-District, Klongtoey District,
Bangkok
Inchcape (Thailand) Company Ltd
100 %
No. 2133 New Petchburi Road, Bangkapi Sub-District, Huaykwang District,
Bangkok 10310
Inchcape Services (Thailand) Co Ltd
49 %
Turks and Caicos Islands
Market Place, Providenciales
Nagoya Marine & General Insurance Ltd
100 %
United Kingdom
22a St James’s Square, London, SW1Y 5LP
Armstrong Massey (York) Limited
100 %
Autobytel UK Limited
100 %
Ferrari Concessionaires Limited
(v)
100 %
Inchcape Motors International Limited
100 %
Inchcape North West Limited
100 %
Inchcape Transition Limited
100 %
Name and registered address
Percentage
owned
United Kingdom (continued)
Inchcape UK Corporate Management Limited
100 %
Inchcape KMG Limited
100 %
Mann Egerton & Co Limited
100 %
Nexus Corporation Limited
100 %
Notneeded No. 144 Limited
100 %
Tozer International Holdings Limited
100 %
Tozer Kemsley and Millbourn Automotive Limited
100 %
Inchcape Digital Limited
100 %
Inchcape (Belgium) Limited
(vi)
100 %
Inchcape Corporate Services Limited
100 %
Inchcape Finance plc
100 %
Inchcape International Holdings Limited
100 %
Inchcape JLR Europe Limited
70 %
Inchcape Management (Services) Limited
100 %
Inchcape Overseas Limited
100 %
Inchcape (Singapore) Limited
100 %
St Mary Axe Securities Limited
100 %
PO Box 33, Dorey Court, Admiral Park, St Peter Port, GUERNSEY GY1 4AT
St James’s Insurance Limited
100 %
4th Floor 115 George Street, Edinburgh EH2 4JN
Inchcape Investments and Asset Management Limited
100 %
Uruguay
Rambla Baltasar Brum 3028, Montevideo
Autolider Uruguay S.A.
100 %
United States of America
The Corporation Company, 30600 Telegraph Road Bingham Farms, MI
48025
Baltic Motors Corporation
100 %
Name and registered address
Percentage
owned
Inchcape Annual Report and Accounts 2024
Strategic report
Governance
Financial statements
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
12 RELATED UNDERTAKINGS continued
Inchcape.com
209
Joint ventures
Australia
Level 6, 15 Talavera Road, Macquarie Park, NSW, 2113
IFSA Pty Ltd
50 %
Chile
Av. Americo Vespucio 1842, Quilicura, Santiago
Sociedad Comercial e Inmobiliaria Autoshopping S.A.
50 %
Sociedad Comercial Ecovalor S.A.
50 %
Av. Las Condes #11000, Oficina 301–A, Vitacura, Santiago
Sociedad de Creditos Automotrices S.A.
50 %
Peru
Av. Manuel Olguin 325, Santiago de Surco, Lima
Sociedad de Creditos Automotrices Peru S.A.C.
50 %
Philippines
,
p
p
,
,
City of San Fernando, Pampanga, 2000
Milwaukee Icon Motors Inc
30 %
Name and registered address
Percentage
owned
Unless stated below, all holdings have one type of ordinary share capital:
(i) Ordinary A and Ordinary B shares.
(ii) Ordinary shares, B Class shares, J Class shares and L Class shares.
(iii) Ordinary shares and E Class shares.
(iv) Ordinary shares, A Class shares, C Class shares, D Class shares and E Class shares.
(v) Ordinary shares, Ordinary A shares and 8% non-cumulative redeemable preference shares.
(vi) Ordinary shares and redeemable cumulative preference shares.
Subsidiary audit exemptions
The following UK subsidiary undertakings will take advantage of the audit exemption set out
within section 479A of the Companies Act 2006 for the year ended 31 December 2024.
Name
Company number
Inchcape (Belgium) Limited
6006735
Inchcape (Singapore) Limited
6257211
Inchcape Corporate Services Limited
1235709
Inchcape International Holdings Limited
3580629
Inchcape Investments and Asset Management Limited
SC113224
Inchcape Motors International Limited
453390
Inchcape Overseas Limited
783712
Tozer Kemsley and Millbourn Automotive Limited
893104
The Company will guarantee the outstanding liabilities of the above UK subsidiary undertakings
as at 31 December 2024, in accordance with section 479C of the Companies Act 2006.
Inchcape Annual Report and Accounts 2024
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Governance
Financial statements
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
12 RELATED UNDERTAKINGS continued
Inchcape.com
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REGISTERED OFFICE
Inchcape plc
22a St James’s Square
London SW1Y 5LP
Tel: +44 (0) 20 7546 0022
Fax: +44 (0) 20 7546 0010
Registered number: 00609782
Registered in England and Wales
ADVISORS
Independent Auditor
Deloitte LLP
Chartered Accountants and Statutory Auditor
SHARE REGISTRARS
Computershare Investor Services PLC
Registrar’s Department,
The Pavilions
Bridgwater Road
Bristol BS99 7NH
Tel: +44 (0) 370 707 1076
SOLICITORS
Herbert Smith Freehills
CORPORATE BROKERS
Jefferies Hoare Govett
UBS AG
INCHCAPE ISA
Inchcape has established a Corporate Individual Savings Account (ISA).
This is managed by Equiniti Financial Services Limited, Aspect House, Spencer Road,
Lancing, West Sussex BN99 6DA
Tel: 0870 300 0430
International callers:
Tel: +44 121 441 7560
More information is available at www.shareview.com
FINANCIAL CALENDAR
Annual General Meeting
15 May 2025
Announcement of 2025 Interim Results
29 July 2025
Inchcape Annual Report and Accounts 2024
Strategic report
Governance
Financial statements
SHAREHOLDER INFORMATION
Inchcape.com
211
Inchcape Annual Report and Accounts 2024
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Financial statements
NOTES
Inchcape.com
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Inchcape plc
22a St James’s Square
London SW1Y 5LP
T +44 (0) 20 7546 0022
www.inchcape.com
Registered Number 609782
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