SIG plc
Annual Report and
Accounts 2024
Leading specialist
building product
distribution across Europe
SIG is a leading pan-European supplier
of specialist insulation and sustainable
construction products and solutions.
We connect over 75,000 customers across
Europe with thousands of products for
better buildings.
SIG strives to be the first choice for roofing,
interiors and construction products among our
specialist building contractor customers. With
a deep product range, on site delivery, expert
knowledge and fabrication services, we help
our customers get the products they need
to deliver better buildings across Europe.
To find out more
please go to
sigplc.com
Highlights
What’s inside
Strategic report
1
Highlights
2
At a glance
4
Our products
8
Chairman’s statement
12 Investment case
14 Market review
16 Chief Executive Officer’s review
20 Strategy in action
24 Business model
26 Sustainability review
52 Key performance indicators
54 Financial review
62 Risks and risk management
Governance
68 Chairman’s introduction to Governance
70 Board leadership and Company purpose
78 Division of responsibilities
84 Nominations Committee report
88 Audit & Risk Committee report
96 Risk management and internal control
98 Directors’ remuneration report
120 Directors’ report
125 Directors’ responsibilities statement
Financials
127 Consolidated income statement
128 Consolidated statement of
comprehensive income
129 Consolidated balance sheet
130 Consolidated statement of changes
in equity
131 Consolidated cash flow statement
132 Accounting policies
143 Critical accounting judgements and key
sources of estimation uncertainty
146 Notes to the consolidated
financial statements
184 Non-statutory information
186 Independent auditor’s report
196 Five-year summary
197 Company balance sheet
198 Company statement of changes in equity
199 Company accounting policies
202 Notes to the Company financial
statements
206 Group companies 2024
209 Company information
Revenue
£2,611.8m
2023: £2,761.2m
Like-for-like (“LFL”)
sales decline*
(4)%
2023: (2)%
Underlying operating profit margin*
1.0%
2023: 1.9%
Underlying operating profit*
£25.1m
2023: £53.1m
Statutory loss before tax
£(44.8)m
2023: £(31.9)m
Net debt
£497.3m
2023: £458.0m
Lost time injury frequency rate
(‘LTIFR’)*
8.0
2023: 8.4
Greenhouse gas (‘GHG’)
per £m of revenue*
16.9 metric tonnes
2023: 17.1 metric tonnes
*Refer to pages 52 to 53 for definitions.
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Strategic Report
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Financials
SIG Annual Report and Accounts 2024
At a glance
SIG operates across six European geographies.
Our portfolio of businesses includes established
national specialist distribution brands in some of
our markets, including France and Germany,
whilst we trade under the SIG brand in others.
Across our businesses we are differentiated by
our specialist focus, our end-markets and our
product mix.
6,700+
Employees
c.430
European sites
c.1,100
Delivery fleet
75k+
Customers
– No. 1 Insulation
– Top 3 Other interiors
Ireland
– No. 1 Interiors &
ceilings (NL)
– Top 3 Technical
Insulation
Benelux
£104m
Revenue
FY2024
11
Branches
£104m
Revenue
FY2024
5
Branches
Our pan-European
presence
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SIG Annual Report and Accounts 2024
– Top 3 Dry lining,
ceilings & insulation
– No. 1 Flooring
Germany
– No. 1 Insulation
– No. 2 Other interiors
Poland
– No. 1 National roofing specialist
– No. 2 Interiors
France
– No. 1 National roofing specialist – No. 2 Insulation and dry lining
United Kingdom
£200m
Revenue
FY2024
40
Branches
£410m
Revenue
FY2024
100
Branches
£241m
Revenue
FY2024
50
Branches
£438m
Revenue
FY2024
50
Branches
£495m
Revenue
FY2024
30
Branches
£238m
Revenue
FY2024
29
Branches
£381m
Revenue
FY2024
111
Branches
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SIG Annual Report and Accounts 2024
Our products
SIG is a differentiated supplier of leading
products and brands for the interiors, roofing
and construction of buildings.
We are the partner of choice for specialist
building contractors, connecting over 75,000
customers with a deep range of products
needed for the construction and renovation
of commercial and residential buildings and,
increasingly, infrastructure.
Market-leading construction
product specialisms
Revenue mix by product¹
Interiors
63%
Roofing
30%
Construction products
7%
Key suppliers
Key products
Tiles, slates and
membranes
Batten for pitched roofs
Facades
Solar and PV products
Flat roofing
Industrial roofing
Roofing
1. Revenue by product as set out in revenue and segmental information and adjusted to show the construction accessories
and building solutions businesses within UK Specialist Markets separately here as Construction products.
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SIG Annual Report and Accounts 2024
Key suppliers
Key products
Construction accessories
Metal fabrication
Key products
Structural insulation
Technical insulation
Ceiling tiles and grids
Floor coverings
Drylining
Partition walls
and doorsets
Construction products
Interiors
Key suppliers
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SIG Annual Report and Accounts 2024
Our products
Our products are used by our customers
to build a wide range of new buildings, from
commercial buildings to residential housing, and
public infrastructure. Our products are also used
to transform and improve existing buildings into
modern buildings with better energy efficiency,
durability, acoustics, safety, and overall
sustainability and design.
Over 80% of our products support the wider building envelope.
From the latest innovations in roofing materials to new fire
proofing products, customised high performance technical
insulation to sound and vibration proof flooring, SIG delivers
products for better performing buildings to cities and
towns across Europe.
Products for
better buildings
Construction
products
Roofing
Interiors
SIG Annual Report and Accounts 2024
Roofing
Construction products
Restoration of iconic
cathedral roof
After the Notre-Dame cathedral was
gutted by fire in 2019, Larivière, our
French Roofing business, has sourced
and procured specialist roofing materials
required for the rebuilding of the
cathedral’s medieval features, including
nearly 200 tonnes of meticulously
shaped lead in the rebuilding of the
centuries-old lead roof.
Notre-Dame
Cathedral
Paris, France
SIG supplied
Sheet lead for
roofing
New UK energy infrastructure
construction
SIG supplies construction products to
major national infrastructure projects
including the new Hinkley Point energy
project in the UK. Our construction
accessories business has supplied
materials to support the groundworks,
including waterproofing, membranes,
geotextiles, and a range of other
products.
Hinkley
Point
UK
SIG supplied
Groundwork and
waterproofing
products and
materials
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SIG Annual Report and Accounts 2024
New construction and
improvements for
Crossrail station
Building changes and improvements
were needed at Liverpool Street station
to accommodate the new Elizabeth
Line (Crossrail project). This created
very specific passive fire protection
material requirements due to the
location being 34 metres below the
heart of the City of London. Some of
the construction was completed using
offsite solutions and a Design for
Manufacture and Assembly (DfMA)
approach. Our UK Interiors business
was able to work with the contractors
to provide specialist technical insulation
to their requirements.
Liverpool
Street
Station
London, UK
SIG supplied
Technical
insulation
Interiors
Luxury hotel redevelopment
A former post office is being converted
to house a 5-star hotel in the heart of
Luxembourg. LiTT, our French Interiors
business, is providing interiors materials
such as acoustic, waterproof and
standard drylining, insulation and
ceilings. This project will turn an
underutilised ageing building into a
stylish, modernised building with
a new purpose and with improved
thermal efficiency.
Luxury Hotel
Luxembourg
SIG supplied
Drylining,
insulation, ceilings
High rise residential
development
With a height of over 180 metres,
Frankfurt’s EuropaCenter Grand Tower
is Germany’s tallest residential building
and renowned for its modern design
and engineering. We supplied bespoke
drylining and technical insulation
products to this modern urban
living landmark.
Grand Tower
Frankfurt,
Germany
SIG supplied
Drylining and
technical
Insulation
Remodelling with technical
insulation
As an imposing feature of London
industrial architecture, the Grade II
listed Battersea Power Station required
significant renovation to turn it into a
vibrant multipurpose complex. This
included specialist technical insulation
and bespoke engineering to meet
the fire strategy requirements of its
conversion from a disused 1930’s
industrial build. It now features over
2 million sq ft of leisure, retail and office
space and homes.
Battersea
Power
Station
London, UK
SIG supplied
Technical
insulation
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Financials
SIG Annual Report and Accounts 2024
Chairman’s statement
Ongoing progress
despite challenging
markets
As a specialist distributor of
building products, we play a
central role in the building and
construction supply chain”.
Andrew Allner
Chairman
Dear Shareholder,
2024 was notable for the sustained
challenging trading conditions that
pertained throughout the European
construction markets in which the Group
operates. This led to lower profitability
for the Group compared to the prior
year, a free cash outflow, and a
deterioration in balance sheet metrics,
notably leverage. The Board is of course
not happy or in any way complacent
about these results and trends.
However, I am pleased to report that the
year was also notable for the significant
work of our people to strengthen the
underlying fundamentals of our business
and our operating model. Whilst many
of these activities revolved around
managing our cost base to adapt to
the lower level of market demand
across our network, our teams have
also maintained a strong focus on
our customers and on improving the
way we do business.
Furthermore, during 2024 the Group
again traded well relative to its markets.
The levels of engagement amongst both
our customers and our employees
remain high, and in our view these are
inextricably linked. They are a testament
to both the quality of service our
employees are providing and the
strong relationships we have with
our customers.
As a specialist distributor of building
products, we play a central role in the
building and construction supply chain.
We provide a route to market for leading
suppliers and manufacturers and their
products, across a fragmented local
customer base.
As one of the leading providers of
specialist insulation in our European
end-markets, we are also helping to
bring to market products that do and will
address the decarbonisation of the built
environment. Our business model and
the value we bring to our suppliers and
customers is set out in further detail on
page 24.
8
SIG Annual Report and Accounts 2024
Refinancing
In October 2024 the Group successfully
completed the refinancing of both
its €300m Eurobond and its £90m
revolving credit facility (“RCF”), well
ahead of their maturity dates. We
were able to execute these transactions
thanks to strong support and participation
from both existing and new investors in
the new bond, and ongoing support
from our syndicate of banks in the RCF.
Our new facilities mature in 2029,
providing us with good long-term
financing arrangements and continued
robust liquidity to support the Group’s
needs. The coupon rate on the bond of
9.75% is 4.5% higher than the rate on
our old bond, but to be expected given
movements in base rates since late 2021.
Strategic progress
2024 was another year of strategic
progress for the Group, despite a
very tough market backdrop.
We are focused on growing in niche,
specialist businesses and in the higher
value segments in which we operate
across our various geographies.
Our performance has been shaped by
our focus on operational excellence,
which includes a number of self-help
initiatives under our ‘GEMS’ strategy
(Grow, Execute, Modernise, Specialise).
This manifested most clearly in
efficiency initiatives and cost reductions,
but also around product sales mix
and margin management. Further
restructuring was undertaken to drive
permanent cost reductions in central
and operating company overheads.
Total operating cost savings in 2024
were £42m, before inflation.
Continued focus on cost efficiency, as
well as rigorous management of working
capital, will remain key priorities for
the Group.
We have made good progress in
the modernisation of our operations,
most notably with the launch of a new
e-commerce platform in Germany
during the year and the commencement
of the development of the same in our
French Interiors business, both of which
will enhance future profitability and
elevate the customer experience.
The Board continues to believe that the
right approach to e-commerce rollout
is incremental adoption of technologies
by geography, allowing for those
deployed to be tailored to the strategic
development and geographic need of
each country.
Our strategic growth framework, and the
key actions we are taking under this, are
set out in further detail later in this report.
Sustainability
We are committed to growing sustainably.
The Board believes that this goes
beyond strong and sustainable financial
performance, albeit the latter remains of
paramount importance. We take very
seriously the positive impact we can
have on our employees, customers,
suppliers, and communities.
In 2024 we made good progress on
our five long-term ESG commitments,
including the goal of delivering zero
waste to landfill by 2025. Our carbon
emissions reduced by 6% compared to
2023 as we have focused on improving
energy efficiency savings across
branches and the successful transition
of certain assets to electric alternatives.
Further details of these initiatives and
more can be found on pages 28 to 31.
On health and safety, the Board was
pleased to see that the ‘Everyone Safe,
Every Day’ strategy launched in 2023 is
producing good results, and further
details on this can be found on pages
36 to 37.
Group performance
The Group like-for-like revenue decline
of 4% reflects persistently weak levels of
end-market demand and consequently
lower sales volumes, together with some
sales price deflation. Good trading
momentum and commercial execution
in our businesses helped offset some
of these market headwinds and
enabled us to outperform the market
in the majority of our businesses.
We reported an underlying operating
profit of £25m (2023: £53m), and an
underlying loss before tax of £14m
(2023: £17m profit). The Group
generated a statutory loss before
tax of £45m (2023: £32m loss).
As a result of the operating profit
performance, the Group reported a
free cash outflow of £39m for the year.
Year-end net debt was £497m (2023:
£458m) which included net lease
liabilities of £321m.
No dividend is proposed for 2024. We
will continue to focus on profitability and
free cash flow generation and delivering
progress toward our leverage target,
which has slowed in the weaker market
of the last two years. The Board remains
committed to returning to paying a
dividend when we sensibly can, as part
of our wider capital allocation policy.
Governance and Board
We believe that good corporate
governance comes from an effective
Board that provides strong leadership
to the Group and engages well with
both management and stakeholders.
The Board firmly believes it is important
for Directors to engage directly with
employees to gain first-hand insight into
their challenges and views. During the
year, I am pleased to report that our
nominated Board member Simon King
continued to deliver our Board
Workforce Engagement programme,
meeting face-to-face with a broad
cross-section of employees. You can
read more about this on page 75.
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SIG Annual Report and Accounts 2024
Chairman’s statement continued
During the year, one of the continuing
areas of focus for the Board was on
development and succession planning
for the ELT and senior management,
to ensure that the Group has a diverse
pipeline of future leaders. Further
information on talent and succession
planning can be found in the Nominations
Committee Report on page 84. I believe
we have a strong and experienced
executive team in place, and this
gives me and the Board confidence
for the future.
My colleagues and I believe the Board
continues to perform effectively. Details
of our 2024 internal review of the Board
and its Committees’ performance and
effectiveness can be found in the
Corporate Governance Report from
page 68.
People and culture
I, along with the rest of the Board, would
like to thank our people for their efforts
and achievements during the year.
We remain cognisant of the economic
climate and its impact on individuals and
their families, particularly the cost of
living, and we work hard to implement
appropriate initiatives and plans to
mitigate its impact on our employees.
Our people strategy continued to
progress well during the year – the
employee survey made it clear that they
feel safe, valued, and proud to work for
SIG. We are really encouraged by the
focus on cultivating the talent across
our business through a variety of career
development and further learning
opportunities, all of which also help
to encourage the positive culture of
the Group.
Our culture is built on employee
engagement and plays a core part in
building the solid foundations that any
business needs to succeed. Our annual
survey allows us to directly engage with
employees and gain valuable insights
from a range of perspectives, helping to
shape suitable strategies and policies at
the Board level. The Board was pleased
to see continued progress in a number
of areas and that we are either close to,
at, or higher than benchmark levels on
engagement in most areas across the
Group. You can read more about our
commitment to our people
on pages 38 to 41.
Looking ahead
Our continued focus on strengthening
our operating performance and
underlying operations will ensure the
Group is well placed to take advantage
of market volumes as they recover
across our various markets, and this will
support the Board’s overarching goal
of delivering meaningful value creation
over the medium and long-term. The
refinancing that we concluded in 2024
was an important building block,
providing near and medium-term
financial stability and certainty.
I would like to thank all of our
employees, and indeed all of our
stakeholders, for their continued
commitment and support as we
navigate these difficult markets and
build a Group that is well placed to
thrive in the medium and longer term.
Along with the rest of the Board, I look
forward to continuing working with
Gavin and the executive team in driving
the business forward. I am confident
that we can deliver on our expectations
for 2025 and beyond.
Andrew Allner
Chairman
4 March 2025
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SIG Annual Report and Accounts 2024
Strategic framework
Grow
Continue
above-market
growth
Execute
Strengthen
execution
and margin
Specialise
Accelerate in
specialist, higher
return businesses
Our medium-term strategy
Our long-term objectives
Improving our operating
performance
Our vision
To be the best provider of specialist
construction and insulation products in Europe
Partner of choice for
specialist contractors
Growing sustainably
as a responsible business
Our behaviours
Be bold
in what
you do
Make a
positive
difference
Be flexible
and agile
See page 20 for Strategy
See page 26 for ESG
See page 24 for Business model
See pages 38 to 41 for more information
2
1
Modernise
Greater
productivity through
modernisation
3
4
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SIG Annual Report and Accounts 2024
Investment case
SIG has a clear strategy to drive meaningful long-term
growth in value for shareholders. This is underpinned by a
differentiated and diversified business model, together with
a strong focus on operational performance and growing
ahead of the market.
Meaningful value
creation opportunity
Diversified by geography
and end-markets
Specialist focused
Product mix weighted
to structural growth
tailwinds
− We are well diversified by
geographic spread and
construction end-markets
in which we operate
− Pan-European presence
across six geographies
− Revenue broadly balanced
across commercial and
residential (c.50:50) building
projects
− Revenue is also evenly
balanced between RMI and
new-build project (c.45:55)
end-markets
− Leading market positions with
scope for further share growth
− Market-leading construction
product range depth, across
a fragmented customer base
− Market-leading construction
product specialisms and
knowledge in distribution and
in specialist fabrication
− Product specialisms and range
depth enable us to support a
range of specialist contractors
− SIG benefits from a revenue
mix that is weighted towards
long-term demand for
sustainable construction
and better buildings
− c.80% of revenue from
products supporting energy
efficiency of building envelope
− Weighted to long-term
structural tailwinds
− These include European
regulatory tailwinds for building
decarbonisation and energy
efficiency, ageing buildings
requiring renovation, and
pent-up demand for housing
See pages 2-3
for more information
See pages 4-5
for more information
See pages 14-15
for more information
12
SIG Annual Report and Accounts 2024
Improving operating
performance
Margin-accretive
portfolio opportunities
Successful
and experienced
leadership team
− 5% operating margin target
offers material upside on
existing revenue base
− Target margin will drive
meaningful growth in cash
generation
− Opens up wider value creation
opportunities
− Accelerate growth in
higher-value specialist
businesses
− M&A
− Well regarded management
team with a strong track record
− Depth of industry experience
across pan-European
construction sector and in
executing growth strategies
− Track record of value creation,
financial discipline and
strategic execution
See pages 20-23
for more information
See page 23
for more information
See pages 80-81
for more information
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SIG Annual Report and Accounts 2024
Macro economic drivers
Ageing buildings and infrastructure
across Europe
Across our end-markets, ageing buildings are requiring
rebuilding and renovation. Approximately 70% of houses
in the EU were built before 1980, driving long-term
renovation demand.
Housing undersupply and
pent-up demand
There has been a structural undersupply of housing in
Europe in recent years, the cumulative effect of which has
been to create a housing supply deficit over time and
pent-up demand for new-build housing.
Sustainability-driven regulations
The building and construction sector accounts for
approximately 37% of global energy and process related
carbon emissions. To meet global carbon reduction targets,
European governments continue to implement legislation,
incentives and standards to lower the carbon emissions
and embodied carbon from new and existing buildings.
GDP growth
In addition to the structural trends above, long-term
construction industry growth rates are also driven by national
economic activity, GDP growth and population growth.
Market review
SIG is well positioned to benefit from
key long-term structural growth tailwinds
including demand for more sustainable and
safer buildings, pent up demand for housing
from an ongoing undersupply in Europe,
and a large proportion of ageing buildings
across Europe that require renovation.
Well positioned for
sustainable growth
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SIG Annual Report and Accounts 2024
How we are responding
We believe we are well positioned
to benefit from these long-term
structural drivers due to our market
leading positions in the construction
supply chain in key markets across
both the United Kingdom and the EU.
SIG’s pan-European sales have around 45% weighting to RMI (renovation and
remodelling projects) overall. Within our two dedicated roofing business, the
sales are weighted closer to 60% RMI projects, and these businesses in
particular benefit from the need to upgrade buildings to improve their
performance and design both on the commercial and residential side.
For example, the UK government has
indicated a housebuilding target that
will require an average annual rate
of 370,000 additional homes to be
created per annum. This would
require around a 51% increase in
the FY24 annual rate of construction
of additional homes (UK Construction
Products Association, September 2024).
SIG supplies products required for the construction of new-build residential
projects in all of our geographies, with residential projects overall representing
around 50% of Group sales. As set out in our Strategic Framework we are
focussed on being the partner of choice for specialist contractors including
those who supply new-build residential projects, to support long-term demand
for housing.
These regulations include changes
to building codes to require greater
thermal efficiency and insulation,
more energy efficient heating,
funding for decarbonisation of public
sector buildings, incentivising "zero
carbon" buildings and use of solar
and other lower carbon building
products and technologies.
With around 80% of our revenue generated from insulation and products related
to the wider building envelope, we are market leading specialists in insulation
across Europe with top three market positions in this product area across our
geographies. We supply a breadth of products and systems that improve the
thermal efficiency of buildings and meet the demands of increasing regulation.
Our UK Specialist Markets division is producing an increasing range of high
performance fire protection products to meet demand from the tightening of
building fire safety regulations under the UK Building Safety Act 2022.
Our UK and France Roofing businesses have rolled out new solar product offerings.
Demand for repair, maintenance and
improvement (‘RMI’) is also linked to
economic growth tailwinds.
During 2024 market conditions for the European building sector have been
challenging, and volume demand for building products has declined in the large
majority of geographies, linked to GDP and interest rates. Higher interest rates
have increased the cost of construction projects.
We have responded to this by adjusting our cost base to recognise the lower
demand environment while also focusing on strategic actions to better capture
growth and profitability ahead of market recovery.
Revenue by building type
Revenue by project type
Non-residential
RMI
Residential
New-Build
50%
55%
50%
45%
Source: Euroconstruct (Dec 2024).
Construction market recovery from cyclical lows
Evolution of expected construction output in Europe
1.8%
5.4%
(1.3%)
(2.4%)
2.4%
0.6%
2026E
2025E
2024A
2023A
2022A
2021A
0.0
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SIG Annual Report and Accounts 2024
Chief Executive Officer’s review
Reshaping our
operations for
profitable growth
SIG’s 2024 results reflect the
significant efforts of our people
as we reshape our business to
deliver more profitable growth
over the medium-term.
Gavin Slark
Chief Executive Officer
Overview
The Group reported lower sales and
profit in 2024 than in 2023, as a result of
prolonged challenging market conditions
across the European building and
construction sector. However, we have
substantially mitigated the impact of
weaker markets by disciplined cost
management and a range of productivity
initiatives.
We have also maintained a strong focus
on our customers and delivering great
service, and I am proud of the focus and
execution our people have shown to
manage through these tough markets.
We are keeping focussed on the clear
medium-term opportunity we see to
deliver better performing, higher margin
businesses across the Group.
2024 results
Our 2024 results demonstrate the
significant action that we have taken to
realign our cost base and operations to
manage the weaker market conditions.
This has involved very tight cost
discipline and strong commercial
execution by our people across our
countries to manage down our costs
as volumes and price have weakened,
whilst not compromising our ability
to maintain excellent service to our
customers and deliver sustainable
profitable growth into the future.
This is always a fine balance, because
our distribution business model carries
a higher fixed cost element relative to
some other industries, but it is important
to have a strong, effective branch
network with great people ready to
serve our customers as markets
pick up.
I am pleased with the strong management
and leadership shown by our teams and
the efforts of our people across all
regions in this regard. Our customer
NPS scores went up year on year in
a number of our regions, despite the
market headwinds. This is a strong
result, and despite the typical pressure
on this metric in weaker markets.
Our employee engagement levels have
also remained broadly stable, despite
the actions we have taken to reduce
some roles and costs. This engagement
is reflected in the strong commitment
our colleagues have shown in managing,
in a very agile way, through these
difficult markets.
16
SIG Annual Report and Accounts 2024
Another KPI is our like-for-like (“LFL”)
growth rates. While many of these rates
are negative due to the weaker market
conditions, in almost all geographies our
LFL rates showed strong momentum
through the second half and almost all
our businesses were ahead of their
underlying market.
Group revenue of £2,611.8m in 2024
(2023: £2,761.2m) reflected a LFL
revenue decline of 4% (2023: (2)%),
driven by the lower market volumes
and lower year on year pricing.
Group underlying operating profit of
£25.1m (2023: £53.1m) and underlying
operating margin of 1.0% (2023: 1.9%)
reflect the impact of the lower revenues,
which could not be wholly offset by the
significant cost reductions we made.
On a statutory basis, the Group
generated a statutory loss before
tax of £44.8m (2023: £31.9m loss).
Market dynamics
During 2024 our LFL revenue growth
rates across most geographies
improved in H2 compared to H1, as
noted above, as volumes remained
negative year over year but stabilised
sequentially over the first half as we
lapped the market declines experienced
in H2 2023.
Across our end-markets, the conditions
impacting our sales volumes weakened
slightly further compared to 2023.
Interest rates remained higher than had
been expected for longer, and this has
continued to suppress construction
sector activity, with residential
construction projects showing the
greatest weakness.
In all of our geographies, except for
Ireland, total construction output was
lower year on year, with the rate of
new-build residential projects declining
between mid-single declines in the UK
and the Netherlands to a c15% decline
in Germany and c20% decline in France,
according to Euroconstruct’s December
2024 report.
As set out in further detail in the
‘Our Market’ section of this Strategic
report, the Group’s trading environment
includes the impact of near-term
economic trends and long-term
structural growth drivers.
While our results were impacted in 2024
by short-term economic trends, we also
continue to see evidence of the long-
term demand drivers for growth in
our sector and in our portfolio of
businesses, with further details shown
in the section referenced above.
Operating performance
In the UK Interiors business we
have accelerated the strategic and
operational changes that will enable
that business to sustainably improve
its operating margin.
This acceleration has been driven by a
new Managing Director, Howard Luft,
who joined the business in October
2024. We have closed three more loss
making branches during the year, and
have launched several programmes
to drive both better delivery and
operational cost efficiency, as well as
to enhance product mix, margin and
pricing processes.
Whilst this business remains relatively
dependent on residential new-build
activity levels in the UK, we believe
that these changes, combined with
a medium-term outlook that will be
supported by significant pent-up
demand for new housing, will drive
a gradual but marked step up in
profitability.
UK Roofing has positive momentum and
delivered a notably strong set of results,
well ahead of its market. This reflects the
ongoing investments made in the
business to driver better customer
experience across our branches,
commercial execution, and employee
engagement.
In the UK Specialist Markets business,
revenue was affected by weaker
demand in the agricultural and
commercial warehousing sectors,
but there was more resilience in our
construction accessories business.
In France, I am very pleased at how
both businesses continue to execute
effectively on their strategic plans, and
to manage well through a very subdued
market. Both businesses have also
grown their customer engagement
scores despite the market headwinds.
Larivière, our roofing business in France,
was impacted by the weak French
construction market with the rate of
decline reducing in H2 as the business
lapped the prior year comparator.
Larivière has increased its sales focus
on larger customers and higher value
products alongside its core ranges.
LiTT, our interiors business in France,
has experienced weaker demand and
volume as well as market pressure on
price, with notable weakness in new
residential projects. Despite this, the
business has grown its market position
in 2024 with a continued strong focus
on service and delivery.
Our German business continued its
robust recovery of the last three years,
performing extremely well in what is also
a very challenging current market.
Poland’s growth softened in the second
half due to an unexpectedly weaker Q3
and with year on year weakness in the
commercial project market in particular.
Ireland delivered stronger results in
2024, partly due to market recovery
after a very soft 2023, but also thanks to
strong commercial execution and solid
demand in our specialist contracting
businesses, which cover office fit-out,
kitchen and bathroom fit-out, and
industrial infrastructure painting.
Benelux executed a significant
restructuring in its Netherlands business
in Q4, closing a number of branches,
to narrow its focus to higher value
categories in interiors and technical
insulation. This is a key step on their
way to an improved margin and positive
cash generation.
Strategic progress
Our vision is to be the best provider of
specialist construction and insulation
products in Europe. Being the ‘partner
of choice’ to our specialist customers is
one of our three long-term objectives.
Our second long-term objective is to
improve our operating performance,
and we are focussed on four key pillars
to drive our performance over the
medium-term to our 5% operating
profit margin target.
These targets are a key threshold for
unlocking meaningful value creation for
shareholders, specifically through higher
cash generation. Our third long-term
commitment is to grow sustainably, and
further detail on this can be found in
our Sustainability review on pages
26 to 51.
17
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Financials
SIG Annual Report and Accounts 2024
Chief Executive Officer’s review continued
Our Strategy in action on pages 20 to 23
sets out our strategic progress in more
detail. Key areas of strategic progress in
2024 can be summarised as follows:
Grow
Despite continued market contraction
in 2024, we kept our focus on delivering
great service, having the right products
in the right place at the right time,
coupled with excellent logistics, and
hence being the ‘best’ in the eyes of
our customers.
Our 2024 LFL sales growth rates in our
largest operating companies continued
to show good performance relative to
the local market. Notably, in the United
Kingdom, our UK Roofing business
continued to trade with robust
momentum against the wider market
and continues to benefit from
investments made in the customer
service experience in our branches,
and in sales and marketing.
In Germany, the LFL rate achieved
was materially stronger than the wider
market and reflects the business's
continued momentum following
turnaround actions over the last three
years, including reinvestment in sales
and in branch employee engagement.
In February 2025, we hosted a major
trade show in Frankfurt, the first of its
kind in the German market in our
space, bringing together over 1,500
representatives of our customers
and suppliers under one roof.
This event was an excellent example of
industry leadership in action and an
example of why our German business
is performing so strongly.
Execute
We are committed to improving execution
in all facets of our business in order to
deliver consistent and profitable growth.
We are focused on performance
management, cost discipline, and
product mix (with the aim of selling more
higher margin products within existing
categories, and increasing private label
sales), and on improving performance in
our UK Interiors and Benelux businesses
in particular.
During 2024, we took further restructuring
actions to reduce our permanent cost
base to mitigate the impact of lower
volumes on profitability.
These measures, together with those
commenced in the second half of 2023,
are expected to generate £37m in
annualised cost savings, and a £25m
profit benefit including the overall impact
of branch closures.
We have also reduced headcount, by
around of 430 over the course of 2024.
This included approximately 290 from
restructuring.
We closed 17 branches that were either
consistently underperforming, had seen
a negative change in local market
growth dynamics or were in locations
which we believe we can service more
effectively from another branch.
Modernise
The progressive modernisation and
digitalisation of our operations creates
an important opportunity for the Group
to increase overall profitability and
efficiency.
In 2024 we expanded our customer
facing e-commerce platforms, with a
new omnichannel sales model and
e-commerce platform launching in
Germany in August.
In France, an e-commerce platform
for France Interiors is also being
progressed, towards a targeted launch
in the first quarter of 2025. In both we
are developing these platforms by
leveraging our successful e-commerce
experience in Poland.
Both platforms will allow us to provide
a more seamless and convenient
customer experience, by allowing
them to purchase from SIG through
the channel most convenient
for them anywhere, anytime.
Higher focus on
value-added products
During 2024 our businesses have updated their
medium-term strategic plans to drive greater growth
in higher-value, higher margin products. In France
Interiors and Germany, this is focussed on scaling up
in core accessories ranges where private label ranges
have been re-introduced in recent years. In UK Roofing
and France Roofing, both businesses are bringing to
market new innovative ranges for waterproofing and
sealants that offer both better performing products for
our customers at better margin. For example, in 2024
Lariviere launched its new ETANX waterproofing
products line, in addition to continuing to grow its
established Irondel private label range.
Our value-added product expansion also includes
specialist products designed to make buildings safer
and more sustainable. In 2024, this has included new
low-carbon Speedline drywall systems wall, partitioning
and ceiling products and over 60 new fire protection
products in development in UK Specialist Markets.
18
SIG Annual Report and Accounts 2024
Specialise
We aim to accelerate our growth in more
specialist, higher margin opportunities.
In 2024 our UK Specialist Markets
business developed a number of
innovative new products in our
performance materials manufacturing
and fabricating businesses.
Some of these new products will target
future market demand for even greater
fire protection in high rise and other
buildings, following changes under
the UK Building Safety Act.
More broadly, our performance materials
business has already launched a
number of new products during the
year, and has a strong product
development pipeline.
The launches have been supported by
new training modules to support the
specification of our new products earlier
in the building design process.
Sustainability
During 2024 we made good progress
on a number of our long-term targets.
One of our targets is to reach zero SIG
waste to landfill by the end of the 2025
financial year. In 2024, we further
improved our rate of diversion of
waste to landfill, reaching 96%, an
improvement from 94% in 2023.
On carbon, our net zero emissions fell
by 6% in the year, and have decreased
by 18% against our 2021 baseline.
The significant driver of our carbon
emissions remains our fleet, which
we rely on to deliver our products.
We continue to make progress towards
our long-term reduction targets,
although progress will not always be
in a straight line each year as it is also
influenced by market-driven changes
in delivery volumes and by the rate
at which commercially viable new
low-carbon HGV technologies are
brought to market.
Our safety performance also improved
in 2024, with a small reduction in our
Lost Time Injury Frequency Rate
("LTIFR") to 8.0 from 8.4 in 2023, driven
by our ongoing safety programme to
keep ‘Everyone Safe, Every Day’.
Outlook
The Group continues to expect softness
in market conditions in 2025 and, to the
extent there is a recovery, that it is more
likely to drive demand in the second half
of the year. Trading trends in early 2025
have been largely as we would have
expected, and LFL sales for the first
two months of the year were flat on
prior year.
Our medium-term strategy
Connecting
customers...
...with
suppliers
See pages 20 to 23 for more information
Grow
1
Deliver
above-market
growth
Modernise
3
Greater
productivity
through
modernisation
Execute
2
Strengthen
execution and
margin across
geographies
Specialise
4
Accelerate in
specialist,
higher return
businesses
During this period of market weakness
we will continue to focus on our
execution, manage near-term margin
pressure and strengthen our operating
platform.
Alongside ongoing targeted investment
to support our strategic growth
enablers, the benefits from productivity
and cost initiatives will contribute
incrementally as the year progresses.
The operational gearing in our business
model applies equally strongly in
conditions of rising demand, and,
accordingly, the Board believes the
Group remains very well positioned to
benefit from the market recovery when
it occurs. This also underpins our
continued belief that the Group will
deliver its targeted 5% operating
margin in the medium-term.
Gavin Slark
Chief Executive Officer
4 March 2025
19
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Governance
Financials
SIG Annual Report and Accounts 2024
Chief Executive Officer’s review continued
Strategy in action
Grow
UK Roofing delivered strong
growth ahead of the market
SIG Roofing, our UK Roofing business delivered strong sales
growth in 2024 relative to a weak UK market. Reporting 2%
LFL sales growth for the year, this included H2 growth of
5%, while the overall market in which it operates remained
negative. This performance has been underpinned by the
businesses multi-year programme to revitalise its customer
experience and branches, and supported by a range of
growth initiatives and an engaged and motivated team.
See page 55 for more information
5%
UK Roofing
H2 2024 LFL sales
growth
How
–Continuous improvement approach
to customer service
–Branch network growth, investment
and refurbishment
–Sales team skills, training and
development
Progress
–£2,612m reported revenue, down
4% on a LFL basis on 2023, but ahead
of market growth in a majority of markets
–Group customer NPS of +51,
an increase of +1 on 2023
–£16.1m capex invested including branch
refurbishment
–Ongoing sales teams skills, training
and development programmes
1
Deliver above-market
growth
What
Our ambition is to deliver profitable revenue
growth above the market rate of growth.
With 'top three' positions across our
geographies, and ‘number one' positions
in a number of product categories, our
ambition is to be the leader across
our markets.
We aim to grow our market share by
delivering the best service and being the
best specialist distributor and partner of
choice for our customer.
20
SIG Annual Report and Accounts 2024
We are improving our operating performance and are
targeting a 5% operating margin target for the Group
in the medium-term. Strategic actions in four key areas
will allow us to achieve this.
>5%
Group operating
margin target
Execute
Netherlands restructure to
sharpen focus on higher value
interiors and technical
insulation products
In late 2024, we completed a significant restructure of
our Netherlands business, closing seven branches which
previously sold interiors and exteriors plaster products. This
was a market in which we had lost share over successive
years and faced significant headwinds from structurally low
margins. This change enables us to refocus on technical
insulation and higher value interiors (ceilings etc.) and
distribute this nationally via our large Waalwijk distribution
centre, to leverage our better market position and return
to profitability.
See page 56 for more information
37%
Netherlands operating
cost base reduction
FY24
How
–Performance management focus
–Cost discipline
–Product mix – selling more higher
margin products within existing
categories, and increasing private label
–Improving performance in UK Interiors
and Benelux
Progress
–2024 £42m net operating cost saving,
before inflation
–New management appointed in
UK Interiors in October 2024, with
accelerated restructuring programme
to improve cost and efficiency rolled
out in UK Interiors
–Benelux restructure to refocus
Netherlands operations on higher value
interiors and technical insulation products
–Increased focus on higher margin
product mix and private-label product
growth across geographies
2
Strengthen execution and
margin across geographies
What
We are committed to improving our
execution and our operating platform
to deliver more profitable growth.
Increasing our focus on operational
excellence offers further potential for margin
accretion in each of our geographies.
We believe that having motivated people,
winning branches and efficient operations
are key to performance.
21
Strategic Report
Governance
Financials
SIG Annual Report and Accounts 2024
Chief Executive Officer’s review continued
Strategy in action continued
Modernise
New omnichannel platform
launched in Germany
In 2024 we have expanded our customer facing e-commerce
platforms, with a new omnichannel sales model and
e-commerce platform launching in Germany in August, and
another in progress in France Interiors to launch in 2025.
Both platforms will allow us to provide a more seamless
and convenient customer experience, by allowing them to
purchase from SIG through the channel most convenient for
them – anywhere, anytime. We expect both platforms, once
fully established, to increase revenue through greater share
of wallet from existing customers, and within that to also
increase private label sales per customer, with these sales
typically being higher margin.
See page 18 for more information
2
new e-commerce
platforms developed
in 2024
How
–Process, system and
organisational efficiency
–Technology enhancing customer
experience and supporting sales
and product mix
Progress
–Successful launch of new e-commerce
and omnichannel platform in Germany
–Development of new France Interiors
e-commerce platform progressed
towards launch in 2025
–Digitalisation of customer interfaces in
UK Roofing supporting customer
engagement and sales
3
Greater productivity through
modernisation
What
Across our operating companies we are
pursuing the progressive modernisation
of our operations.
This includes improving our systems and
operational processes through the use of
technologies for greater efficiency.
It also includes modernisation to drive
improvements in customer experience and
in the way that we sell to and service our
customers.
22
SIG Annual Report and Accounts 2024
Specialise
New fire protection products
in UK Specialist Markets to
support regulatory-driven
demand
In 2024 our UK Specialist Markets business developed a
number of innovative new products in our performance
materials manufacturing and fabricating businesses.
These new products target future market demand for
greater fire protection in high rise and other buildings,
following changes under the UK Building Safety Act.
See page 18 for more information
60
new fire protection
products launched and
in development in UK
Specialist Markets
in 2024
How
–Additional management and sales focus
to support business growth and grow
market positions
–Investment in inventory and product
ranges in specialist areas to support
growth
Progress
–Continued progress in securing new
infrastructure projects within UK
Construction Accessories
–UK Specialist markets launched a
number of new high performance fire
products in the period
–Nationwide roll-out of solar offering in
French and UK Roofing businesses.
New solar warehouse in France and
UK solar quoting tools to support
customer sales
4
Accelerate in specialist,
higher return businesses
What
The Group’s portfolio of businesses
includes some attractive positions in
highly specialist areas of the building
products industry.
These businesses generate a higher
average return than the present
Group average.
By increasing our strategic focus to
accelerate growth in these businesses,
we aim to increase the contribution of
these businesses within the Group overall.
23
Strategic Report
Governance
Financials
SIG Annual Report and Accounts 2024
Business model
Our business model is underpinned by the depth and breadth
of our resources, which allow us to execute our strategy.
In addition, our resources and stakeholder relationships are
key to our success and we invest in them throughout the year.
Supported by
Inputs
Employees
Engaged, committed and
knowledgeable colleagues working
across our local branches, delivering
superior service and expertise and
leading our businesses.
6,700+
Employees
Customers
A fragmented customer base of
more than 75,000 customers across
local markets, including specialist
contractors and installers, developers
and independent merchants.
75,000+
Customers
Branch network and
delivery fleet
We supply our products through c.430
branches in local markets across six
European geographies and a delivery
fleet of around 1,100 vehicles to
customer and project sites.
c.430
Branches across
six geographies
Products
Working with leading product suppliers
we supply a deep range of specialist
construction products and systems
across interiors, roofing and
construction product categories.
See page 26 for more information
Responsible and sustainable approach
Leading pan-European
supplier of specialist
insulation and building
products and brands.
Connecting
suppliers...
Interiors
Construction
products
Roofing
Adding value
Access to highly fragmented
customer market
Facilitating supplier market
share and growth
Route to market support
Our customer-focused
business model
24
SIG Annual Report and Accounts 2024
Creating value for our stakeholders
Employees
–Career development, training
and apprenticeships
–Providing jobs in a supportive
and safe working environment
>200
apprentices
Customers
–One-stop access to deep
product range
–Coordinating dynamic
delivery requirements
–Supporting large complex projects
–Credit and payment terms
–Specialist knowledge and support
+51
customer NPS
Suppliers
–Access to highly fragmented
customer and project market
–Facilitating supplier market growth
–Route to market support
Leading
international
and national
supplier brands
Communities & Environment
–Committed to creating jobs in
local communities
–Reducing carbon and waste and
supporting building industry
decarbonisation
6%
reduction in net
zero carbon
emissions
Investors
–Meaningful value creation
opportunity for shareholders
5%
medium-term
operating
margin target
See page 68 for more information
Sound corporate governance
See page 62 for more information
Risk management
Helping specialist
contractors get the
products they need to
deliver better buildings.
…with
customers
Specialist
contractors
Specialist
installers
Developers
Independent
merchants
Adding value
One-stop access to product range
Coordinating dynamic
delivery requirements
Specialist knowledge and support
Credit and payment terms
25
Strategic Report
Governance
Financials
SIG Annual Report and Accounts 2024
Sustainability review
As a leading supplier of specialist insulation
and building products, SIG is positioned to
support decarbonisation across the built
environment. Many of our core products
support better building energy efficiency.
Making a positive
difference
We introduced our five sustainability commitments in 2021,
which remain fundamental to our approach to ESG –
covering our impact on the environment and our employees.
Our sustainability programme underlines and supports
our goals of growing as a responsible business.
Our sustainability commitments align with the United Nations
Sustainable Development Goals (“SDGs”). The six most
relevant six goals are detailed in our sustainability
commitments table.
In 2024, we conducted our first Double Materiality Assessment.
We engaged with our internal and external stakeholders to
assess our key sustainability impacts as a business, from both
a financial and social-environmental perspective. This double
materiality assessment has defined material topics that are
closely aligned to our existing sustainability commitments.
This assessment will inform our reporting requirements under
the EU’s planned Corporate Sustainability Reporting Directive
(“CSRD”).
26
SIG Annual Report and Accounts 2024
Our sustainability commitments
Page 51 details our Group policies and procedures relevant to
our sustainability commitments. Robust internal controls, ethics
and risk management also inform our approach to sustainability
and ESG. We have a strong approach to corporate governance,
as detailed from page 68.
Our SDG
commitment
Measure
2024
performance
96%
Waste not
going to landfill
85
Sustainability meetings
with suppliers
8.0
Lost time incident
frequency rate (LTIFR)
See page 32
for more details
Zero waste
to landfill
by 2025
Partnering to
reduce supply
chain carbon
and waste
Health and
safety leader
Employer
of choice
+9
Employee engagement
(eNPS) (eNPS +X)
Our net zero carbon emissions
reduced to 39,285 metric tonnes
from 42,015 metric tonnes in 2023.
See page 28
for more details
Net zero
carbon by
20351
6.5%
Reduction in
net zero carbon
emissions
Our Scope 3 assessment
identified our most carbon
intensive products. 85 supplier
engagement meetings included
a discussion on carbon
reduction plans.
See page 34
for more details
See page 36
for more details
See page 38
for more details
Our waste diverted from
landfill rate has improved
by 2% from 94% in 2023.
Our LTIFR has improved
to 8.0 from 8.4 in 2023.
Our eNPS score reduced
to +9 in 2024 from +14 in
2023 but remains positive.
1. Net zero carbon emissions: Scope 1, Scope 2 and business travel emissions.
27
Strategic Report
Governance
Financials
SIG Annual Report and Accounts 2024
296
440
Sustainability review continued
Our approach to carbon reduction
2024 progress
In 2024, we have continued our good
progress in lowering our carbon
emissions. Our emissions accounting
period runs from 1 October to
30 September, providing appropriate
time for reporting and assuring our data
set. Our Scope 1, Scope 2 and limited
Scope 3 emissions1 have been verified
to a limited level of assurance by Intertek
in accordance with ISO 14064-2.
Our carbon footprint encompasses
emissions we are directly responsible
for, including fuel and plant fuel use
(Scope 1). Our Scope 2 emissions
are related to the electricity we use
in our operations. We have disclosed
some indirect upstream and downstream
emissions (Scope 3) over which the
business has limited control, including
business travel and third-party
transportation. We include third-party
diesel from transportation where there is
a high proportion of deliveries made to
customers using third-party vehicles.
In 2023, we completed a study to
quantify our total Scope 3 emissions.
Purchased goods and services
constitute 86.2% of our Scope 3
footprint.
Our net zero carbon emissions have
reduced by 6.5% compared to 2023 and
18.1% against our 2021 baseline. The
UK contributed the greatest proportion
of the emissions reduction. The
emissions in the UK, excluding Northern
Ireland, reduced by 12.6% and 2,281
metric tonnes of CO2e. France and
Benelux also reduced emissions in this
period – by 350 and 205 metric tonnes
respectively.
There has been a reduction in the
volume of sales across the Group,
leading to less fuel used and an
associated reduction in greenhouse
gas emissions.
We have continued our long-term trial of
alternative fuels within our fleet. During
2024, the UK business installed a small
number of HVO tanks that will allow us
to trial this fuel and grow usage of it over
the medium-term, subject to commercial
and cost factors. We have increased the
use of bioCNG in our heavy-duty fleet in
France during the year.
In 2024, 66% (2023: 60%) of our
electricity was purchased from certified
renewable energy contracts. The
proportion of renewable electricity
purchased has increased in Poland
and Ireland. We have continued to install
photovoltaic panels across selected
locations, including 930 panels at
Steadmans, our largest energy
consuming site in the UK.
2024 progress
Net zero carbon emissions
6%
2024: 39,285
2023: 42,015
Metric tonnes
Fleet mix by lower-carbon fuel type2
6%
2024: 32%
2023: 26%
Our commitment
Net zero carbon
in SIG operations
by 2035
Scope 1, Scope 2 and
business travel emissions
Fleet mix 2024
Full fleet composition
Total
1,126
1,638
1,737
944
1,101
25
569
HGV/
Vans
Moffet/
FLT
Car
497
629
Petrol/Diesel 2,614
Combined (Electric 2, Biodiesel (B100)* 6, Hybrid 1, CNG 16) 25
LPG 440
Electric 925
Hybrid 497
1. Business travel and third-party diesel carbon emissions have been verified by Intertek.
2. Percentage of electric or hybrid vehicles in our fleet including company cars, vans, forklifts,
moffets and heavy-duty vehicles.
* Vehicle enabled to use biodiesel in France.
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SIG Annual Report and Accounts 2024
Decarbonising our fleet
Our fleet includes heavy-duty vehicles,
vans, forklifts, moffetts and company
cars. Vehicle fuel emissions contribute
91% of our Group Scope 1 and 2
emissions. We operate leased heavy-
duty vehicles in the UK, Germany,
France and Poland. Fleet emissions
have the biggest impact on our overall
carbon footprint.
The emissions from our road vehicles,
including heavy-duty vehicles, company
cars and vans, reduced by 6%
compared to 2023. Sales volume
has the greatest influence on the
volume of road vehicle fuel used in our
businesses. The Group has experienced
reduced sales volumes and therefore,
has made fewer delivery miles,
generating a carbon reduction.
The total number of petrol or diesel
vehicles has reduced by 8%. The largest
reduction is from our company cars as
some employees have switched to
electric or hybrid alternatives. There has
also been a reduction in the number of
diesel heavy-duty vehicles. The trials
of vehicles include biofuels (HVO
and biodiesel), gases (hydrogen and
compressed natural gas (“CNG”))
and electric heavy-duty vehicles.
In France, we have increased the
number of vehicles that can use
CNG or bioCNG to 16.
Emissions from forklifts and moffets
have reduced by 20% compared to
2023. We have increased the number of
electric moffets and forklifts in operation
to 629.
We have an internal fleet working group
which includes representatives across
fleet teams and procurement from each
operating company. The fleet working
group has highlighted challenges in
the availability of infrastructure in our
geographies for electric charging
and hydrogen.
Our carbon reduction milestones
As part of our sustainability commitments, we have a long-term target to achieve
net zero emissions by 2035. This is supported by interim milestones:
Each business has shared their long-
term plans for reducing the number of
combustion vehicles in the fleet. We
expect each country will have a different
pathway to increase the proportion of
lower-carbon vehicles in their fleet, due
to differing government strategies and
national infrastructure. In France, there
is a good network of CNG and bioCNG
fuel infrastructure whilst in other
countries, we expect electrification
of heavy-duty vehicles to be the more
likely pathway.
The long-term decarbonisation pathway
for the transport sector remains
dependent on a number of regulatory,
industry and infrastructure factors
that governments and industry are
yet to fully address. Grid capacity and
reliability are essential for the successful
roll-out of alternative fuel types.
Due to ongoing cost prioritisation,
additional expenditure on fleet related
sustainability initiatives has been paused
as we prioritise fleet cost efficiency.
We are committed to investing in fleet
related carbon reduction once the
market improves and as appropriate
technologies become commercially
available.
2025 focus:
In 2025, we will continue to review
and prepare for future reporting
requirements, including CSRD.
We will also continue to review our
climate transition planning around
industry and political developments
and in line with our reporting
requirements.
2035
2030
2025
100%
of fleet with lower-carbon
engines by 2035 – where
the infrastructure and
technology allows.
40%
reduction in 2030
against baseline.
20%
reduction in 2025
against baseline.
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SIG Annual Report and Accounts 2024
Sustainability review continued
Net zero carbon by 2035 continued
Streamlined Energy and Carbon Report
Mandatory greenhouse gas reporting
Our annual greenhouse gas reporting is calculated in accordance with the requirements of the Energy and Carbon Report
Regulation 2018, for the period 1 October to 30 September. This covers all geographies in which we operate, as well as a small
subsidiary in Spain.
We include the six main greenhouse gases (“GHGs”) and reported carbon dioxide equivalent (CO2e) for our Scope 1 (direct),
Scope 2 (indirect) and limited Scope 3 emissions. We use the GHG Protocol Corporate Accounting and Reporting Standard
methodology for our emissions and energy consumption and the Department for Energy Security and Net Zero (“DENZ”) and
International Energy Agency (“IEA”) GHG Conversion Factors. The annual quantity of energy consumed from activities we are
responsible for includes fuel, electricity and gas.
Scope 1 – Direct
Metric tonnes
2024
Group
2023
Group
2024
UK
2024
Europe
Road vehicle fuel emissions1
32,533
34,600
13,507
19,026
Plant vehicle fuel emissions1
3,020
3,795
1,045
1,975
Natural gas2
1,374
1,580
812
562
Coal/coke for heating 1
38
12
—
38
Heating fuels (kerosene and LPG) 1
862
447
531
331
Total
37,827
40,434
15,895
21,932
Scope 2 – Indirect
Metric tonnes
2024
Group
2023
Group
2024
UK
2024
Europe
Electricity – location-based2
4,517
4,536
2,231
2,286
Electricity – market-based3
1,250
1,296
135
1,115
Total – Scope 1 and 2 – location-based
42,344
44,970
18,126
24,218
Total – Scope 1 and 2 – market-based
39,077
41,730
16,030
23,047
1. Volume of fuel from fuel cards or other purchase records converted according to DENZ emission factors.
2. Electricity and gas meter data is converted according to DENZ emission factors. For branches without meters, we use an estimation
model based on average usage.
3. Market-based emissions reflect emissions from electricity that we have purchased that is certified as renewable electricity.
Location-based emissions are based on country averages.
30
SIG Annual Report and Accounts 2024
Scope 3
Metric tonnes
2024
Group
2023
Group
2024
UK
2024
Europe
Business travel4
208
285
128
80
Third-party diesel5
4,719
5,184
127
4,592
Own vehicles used for company business4
141
148
123
18
Total
5,068
5,617
378
4,690
Total – Scope 1, 2 and 3 – location-based
47,412
50,587
18,504
28,908
Total – Scope 1, 2 and 3 – market-based
44,145
47,347
16,408
27,737
Total net zero carbon emissions6
39,285
42,015
Emissions per £m of revenue
Metric tonnes/£m
2024
Group
2023
Group
Revenue
2,612.0
2,761.2
Scope 1 and 2 – location-based
16.2
16.3
Scope 1 and 2 – market-based
15.0
15.1
Scope 1, 2 and 3 – market-based
16.9
17.1
Total net zero carbon emissions
15.0
15.2
Total energy use
MWh
2024
Group
2023
Group
2024
UK
2024
Europe
Total energy use
183,489,267
193,087,011
78,807,951
104,681,316
Energy efficiency actions
In 2024, we continued to implement energy and fuel efficiency activities across our operating companies. In France, an
eco-driver training programme for 93 employees with a company car, improved fuel efficiency compared to employees who
did not complete the training. We also ran a heavy-duty vehicle training programme with a high proportion of our permanent
drivers completing the training (90.57%).
Our French team have also completed an energy action plan for high energy-consuming sites. Initiatives in the action plan
include reviewing the programming of heating and air conditioning systems.
In Poland, we have replaced coal or oil heating systems with infrared heating. This has reduced our consumption of coal and
heating fuels.
Across our other regions, we have made further progress on branch refurbishments and improving energy efficiency, including
investment in LED lighting and the installation of solar panels.
4. Distances travelled by employees using own vehicles or business travel converted according to DENZ emission factors.
5. Estimated or recorded distance travelled by third-party logistic provider converted according to DENZ emission factors.
6. Net zero emissions includes Scope 1, Scope 2 market-based and business travel.
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SIG Annual Report and Accounts 2024
Sustainability review continued
Reducing waste to landfill
SIG is committed to reducing the waste
we generate, including hazardous
waste. We aim to have zero waste going
to landfill by 2025, where recycling
options are viable. The focus of our
waste reduction plan is the waste that
we directly control at our branches.
We improve our recycling rates by
monitoring and validating third-party
waste contacts. At our branches, we
have focused on waste segregation,
the reuse of packaging and pallets,
and paperless processes.
Our waste reporting year runs from
1 October to 30 September. Data
is provided by waste management
providers.
2024 progress
Total waste increased in the year to
13,178 tonnes. Despite this, our total
waste diverted from landfill is 96%,
an improvement from 94% in 2023.
Two operating companies have zero
waste to landfill – Benelux and Germany.
The UK, France and Poland increased
the proportion of waste diverted from
landfill sites. This is encouraging
progress towards our 2025 target.
The improvement shows the success
of our initiatives, including improving
access to recycling facilities.
Waste is classified according to the
European Waste Classification code.
Our main types of hazardous waste
mainly relate to a small number of
products such as paints, fillers and
finishing products that contain certain
chemicals. If these products are
damaged or out of date, they require
specialist handling in compliance
with national waste regulations.
At the end of 2023, we ran a Group-
wide programme for all branches to
identify old waste or materials stored
that should be removed. This has
increased the amount of hazardous
waste during this reporting period
compared to 2023.
In our role as a distributor in the middle
of the supply chain, we manage logistics
between customers and suppliers.
This means we are well placed to
support a circular economy by
recycling and repurposing materials.
All French and German branches have
waste recycling points for our customers.
The waste collection points allow
customers to recycle packaging waste.
2025 focus:
–We will continue to focus on
reducing waste by reviewing waste
data and sharing best practice on
our waste forum meetings
–We are planning to renew waste
contracts to improve recycling rates
to work towards our zero waste to
landfill target
2024 progress
Total waste not going to landfill
2%
2024: 96%
2023: 94%
2022: 92%
Hazardous waste
80%
2024: 103 metric tonnes
2023: 57 metric tonnes
2022: 192 metric tonnes
Our commitment
Zero SIG waste to
landfill by 2025
32
SIG Annual Report and Accounts 2024
Reducing waste to
landfill in Poland
Our team in Poland has made
significant progress in reducing the
volume of their waste sent to landfill,
despite challenges that include limited
availability of recycling plants.
In 2024, this activity has included visits
to 41 branches in Poland in person
and 4 branches virtually to review and
discuss local waste regulations and
availability of recycling opportunities.
New containers for offices and
warehouses and new contracts to
recycle foil and cardboard were then
implemented as a result and we are
pleased to report that these initiatives
have successfully contributed to a 65%
reduction of waste sent to landfill in
2024 in Poland.
65%
reduction in waste
to landfill in Poland
in 2024
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SIG Annual Report and Accounts 2024
Sustainability review continued
Partnering across our supply chain
As a specialist distributor of products,
SIG plays an important role in the
decarbonisation of our built environment
through supplying building products
crucial for energy efficiency and
generation.
2024 progress
Following our Scope 3 assessment in
2023, we have identified which product
categories are the most carbon intensive
product lines within each of our
geographies. We have identified our
suppliers of these, noting that many
companies supply a wide range of
products including both lower and
higher carbon products.
We engage with our suppliers on a wide
range of topics across our business
every day. Within our many supplier
meetings in 2024, 85 included a
discussion related to addressing carbon
intensive products, product and supply
chain decarbonisation and sustainability.
Topics also included the Environmental
Product Declaration ("EPD") data,
carbon reduction targets and our
suppliers’ lower-carbon and sustainable
product development pipelines.
We provide customers with product
information, including environmental
data points, to make informed decisions
on purchasing. We have EPD for
product lines in the UK, Ireland, Poland
and France (Fiche de Déclaration
Environnementale et Sanitaire).
In Poland, the use of e-commerce
supports the adoption of lower-carbon
products by customers, by highlighting
more sustainable substitute products as
customers search and browse in our
online shop. The platform also allows
us to share product EPD data digitally
with customers.
Within our overall product strategy,
we also have a specific strategy for
developing more sustainable products
within our available range. This strategy
has three components:
–minimising embodied and upfront
carbon generation;
–conserving energy through the lifetime
performance of a building; and
–generating or storing renewable energy
to reduce demand on virgin fossil fuels.
Our teams are assessing the product
range to ensure it satisfies building
regulations for product safety and that
products align to the three components
of the sustainable product strategy.
2025 focus:
–We will review our Group approach
to sustainable products by
developing criteria and product
classifications
–We will continue to work with our
suppliers of our most carbon
intensive product lines
Scope 3
We completed our first Scope 3
calculation in 2023
We will review our Scope 3 reporting
approach to prepare for future
reporting requirements
2024 progress
Supplier engagement on ESG
85 meetings
held with suppliers included a
discussion related to sustainability
Our commitment
To partner with
manufacturers
and customers
to reduce carbon
and waste across
the supply chain
–The goods and services we purchase contribute
86.2% of our Scope 3 footprint, showing the
importance of our engagement with suppliers
and customers to focus on our product offering
to ensure that it can evolve in the years ahead
–The use of sold products and end of life treatment
of sold products were the next highest categories,
with 3.8% and 3.3% of our Scope 3 footprint
More information related to our Scope 3
assessment can be viewed on our website
Scope 3
journey
In our Scope 3
assessment,
we found:
34
SIG Annual Report and Accounts 2024
Engaging with our suppliers on
sustainability – Knauf UK
During 2024, our UK team visited Knauf, one of our key
suppliers of insulation products, at their upgraded production
facility at St Helens. Knauf are producing products at the site
with improved thermal conductivity and have invested to
increase capacity of the site and to improve its carbon
efficiency through initiatives including product compression.
The improvements at the site are part of a wider set of
activities by Knauf to decarbonise operations including
manufacturing and logistics. Knauf aim to improve the
embodied carbon of their products as a result. SIG supplies
a wide range of Knauf insulation products to our customers
in the UK.
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Sustainability review continued
Health and safety
We believe that a safe, healthy
workplace is the cornerstone of a
sustainable, profitable business.
Our aim is to build a culture where
health and safety are an inherent part
of our business activities; where
we strive to ensure that everyone
associated with our businesses
goes home safe and well.
Our employees support this, with health
and safety ranking as one of the top
priorities for our colleagues.
Governance and structure
The ultimate responsibility for health
and safety rests with the Board, Group
CEO and Executive Leadership Team.
This responsibility is cascaded through
the organisation via our operating
company Managing Directors and
their leadership teams.
Each operating company has a health
and safety team, supported by a central
team of experts and the Group Health,
Safety and Environment Director. At a
Group level, the Health and Safety Policy
sets the direction for our businesses,
who manage and monitor their own
objectives, plans and activities in
accordance with this policy.
The health and safety leadership team
also meet on a quarterly basis. This
team comprises the health and safety
leaders in each operating company
and our central Group experts.
Updates on progress and initiatives
are discussed with the aim of sharing
best practice and knowledge across
the Group.
Regular comprehensive reporting from
the businesses to the Board and the
Executive Leadership Team also details
progress on strategy, KPIs, key initiatives
and significant incident detail.
2024 progress
Our health and safety highlights for
2024 include:
–Continuation of our new ‘Everyone
Safe, Every Day’ strategy, objectives
and KPIs
–Our engagement survey shows that
92% of our employees feel safe
at work
–Our lost time incident frequency rate
has improved to 8.0 from 8.4 in 2023
LTIFR history
2024
8.0
8.4
2023
11.1
2022
11.8
2021
Following a significant reduction in our
LTIFR in 2023, we are pleased to see
a small reduction in 2024, indicating
that the improvement is sustainable.
Our LTIFR is 8.0 compared to 8.4 in
2023. Our employee LTIFR (excluding
temporary and agency staff) maintained
at 7.4 in 2024.
We have seen good improvement
in France, where the FTIFR reduced
from 8.9 in 2023 to 7.1, whilst we saw
small increases in Poland (in our new
brances) and Benelux, where
we have seen structural changes
within the business.
Whilst the number of lost time incidents
has reduced, our incident severity rate
has increased slightly to 23.9 in 2024
(2023: 22.3). However, we are still
confident that our approach to managing
the serious risks which could lead to
fatalities and significant harm is working.
In addition, the ‘Total Recordable
Incident Rate’ (using OSHA definitions)
remained stable compared to the
previous year.
Our commitment
Being a health and
safety leader in
building materials
distribution
2024 progress
Lost time incident frequency rate
("LTIFR")
5%
2024: 8.0
2023: 8.4
2022: 11.1
Employees feel safe at work
92%
2023: 92%
2022: 92%
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SIG Annual Report and Accounts 2024
Leadership safety walks
In December, the SIG Group Executive Leadership Team met
at our Valor Park office. The regular management meeting
agenda included a walk through our large UK Interiors
distribution centre, discussing safety and sharing good
practices, solutions and advice between our executive teams
from our other sites and countries.
Under our 'Everyone Safe, Every Day' safety strategy our
managers and leaders regularly walk around our branches
to identify and celebrate the things we do well and identify
opportunities for continuous improvement on safety. Our
leaders remain accessible and visible to all staff to positively
reinforce the culture of safety embedded into our business.
Our total incident rate, including all
incidents, decreased and we believe this
indicates our focus on prevention of all
accident types is working.
The implementation of observational
reporting within our UK, Benelux
and Irish businesses has led to an
improvement in our near-miss/hazard
observation reporting numbers. While
our reporting is not yet at industry
average across all our businesses,
we are pleased with this progress
and continue to work to encourage
all our employees, contractors and
stakeholders to report near misses, and
unsafe/safe situations and behaviours.
All of the performance data above
covers 100% of the Group’s operations.
Progress on strategy
We firmly believe that active, visible
leadership, employee engagement,
and systems and processes that are
continually challenged and improved,
will drive us towards achieving
excellence in our workplaces and
culture. Our strategy is designed to
achieve our vision to provide safe,
healthy working environments and
cultures, where health and safety is
integral to our business activities and
all our people actively engage in our
drive to excellence.
To drive our progress, we have
established annual activities and KPIs.
In 2024, we have focused on the creation
of materials for our leaders, designed
to support the introduction of regular
leadership walks, inspections, and
conversations. The use of technology and
applications has been critical in ensuring
such interactions are practical, and
recorded with actions that can be
tracked. These leadership conversations,
discussions and walks actively demonstrate
interest, ownership, responsibility, and
care for our people’s health and safety.
We have extended our incident reporting
tool to include safety observations and
continuous learning opportunities so our
stakeholders can easily report safety
issues and celebrate good practices.
We have also promoted the use of
the tool, including training sessions,
meetings, and on-site pilots. We
are very pleased that this effort has
produced a 2% increase in positive
responses to the question “I am
comfortable reporting near misses and
safety issues” during our employee
survey this year.
In terms of workplaces, systems, and
processes, we have strengthened our
management systems with several
Group-wide guidance documents
including new employee health
and safety induction requirements,
contractor management processes,
environmental risk assessment
templates and machinery purchasing
specifications. These documents are
aimed at supporting the improvement of
our management system based around
our Group HSE Principles, key hazards
and risks.
Health and safety talent is essential to
our strategy, and therefore this year we
have created a training needs analysis
process, with defined criteria for all ELT
professionals. The programme allows
our teams to assess themselves against
the criteria and the combined output
will support the design of training
programmes for our professionals
in 2025.
The progress against our strategy is
monitored on a regular basis by our
ELT and the Board.
2025 focus:
We will continue our strategy, by:
–Creating a standard training
programme for HSE professionals
–Reviewing our HSE principles and
processes to drive further
improvements
–Establishing the tools, support and
environment so our leaders have the
ability to sponsor, manage and
implement relevant HSE projects
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Sustainability review continued
Committed to being
an Employer of Choice
SIG is a people business. Everyday
thousands and thousands of interactions
between colleagues and with our customers,
suppliers and stakeholders take place and
are the engine for our performance and
growth. We want SIG to be the best place
to work for in our industry, which is why
our people-vision is to be an ‘Employer of
Choice’ in our sector. During 2024, we have
made good progress towards our goal
in three areas.
Our people
Over recent years, we have made strong progress on
building our culture, increasing engagement and inclusion.
Our Culture index score was 74% in 2024, up two points
from 2023. Our Inclusion index score of 68% is up one
point from 2023, and up 11 points from 2022. Our culture
is shaped by our values: Be Bold, Be Flexible and Agile,
and Making a Positive Difference.
An engaged and
inclusive culture
38
SIG Annual Report and Accounts 2024
Over the last three years, we have made significant strides in
placing people at the centre of our strategy. With an increasingly
engaged and inclusive culture, SIG offers a range of programmes
to attract and retain our people across our organisation, from our
apprentices to our managers and leaders as well as to develop
their skills and to drive our performance together.
Julie Armstrong
Chief People Officer – SIG plc
Having great leaders has a strong link to improving
engagement and ultimately providing better customer
service. Hiring, developing and retaining great leaders
is an important part of our people programme at SIG.
Developing great managers
and leaders
We continue to invest in offering opportunities for our
people to develop their skills and capabilities and to grow
their careers at SIG. From our apprenticeship programmes
to our sales training, product knowledge and leadership
development programmes face to face or online, we know
that our people’s professional growth and success supports
engagement and enables our growth and success.
Skills for professional growth
39
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SIG Annual Report and Accounts 2024
Sustainability review continued
Our people continued
At SIG we are committed to the
continual development of our people’s
experience of working at SIG, to be an
employer of choice in our industry.
In 2024, we’ve made further progress
on our people agenda, investing in
developing the skills and performance
of our leaders, in skills for career and
professional growth and in building
a more engaged culture.
For the second year running, our
French, German and Polish businesses
have been recognised as leading
employers in their markets. Wego vti
was again recognised in 2024 as a ‘Top
Company’ by Kununu, a national online
career and employer ranking platform,
based on employees’ votes. SIG Poland
was again certified as a Great Place To
Work®, based on employees’ opinions
and experiences, and in France we
achieved Top Employer certification.
Employee Engagement
& Wellbeing
The results of our 2024 employee
engagement survey show that our
people feel positively engaged in
their work at SIG.
To manage our performance in very
challenging operating environments
this year, we have had to restructure a
number of businesses and reduce some
roles to manage our costs, which has
affected morale in some regions.
However, our overall engagement
scores remain net positive with an
employee engagement index score
of 71% (2023: 71%) in line with our
benchmarks whilst we saw a drop in
our eNPS in 2024 to +9 (2023: +14).
The impact of these changes are being
closely managed so that we maintain
the strong progress we have made
on engagement since 2020.
Health, Safety and Wellbeing remains
the highest scoring index from our
Employee Engagement Survey. 92%
of our people feel safe at work and are
comfortable reporting near misses and
safety issues, indicating that our Health
and Safety policies are working well for
our people. Across the Group we offer
additional mental health and wellbeing
support and resources for employees.
This includes wellbeing tips and apps and
dedicated third party support services.
Culture and Behaviours
Over recent years we have made
strong progress on building our culture,
increasing engagement and inclusion.
Our Culture index scores have grown
this year by 2% pts to 74% this year and
our Inclusion index increased to 68%.
Our culture is shaped by our values:
Be Bold, Be Flexible and Agile and
Making a Positive Difference.
Our behaviours are aligned and reinforced
across our business. They are integrated
into our performance management
and training processes as well as our
recruitment processes and in onboarding
when new colleagues join us.
Diversity, Equality, and
Inclusion (DEI)
We are committed to ensuring that
everyone in our organisation feels
valued and included, and to create
an environment that reflects the
communities in which we operate.
Each business has focused plans to
support this goal and support the
communication and delivery of local
and Group initiatives, including the
impact of these activities in the
business, as measured through the
annual DEI index metric within the
annual employee engagement survey.
Employee engagement
+9 eNPS
2023: +14
2022: +14
2024 progress
Engagement Index
71%
2023: 71%
2022: 73%
Response rate
73%
2023: 71%
2022: 73%
Our commitment
To be an employer
of choice in the
building materials
distribution
industry
Gender diversity (male/female split)1
2024
2023
Male
%
Female
%
Male
%
Female
%
Total Employees
78
22
78
22
Board members
80
20
80
20
Executive Leadership team
85
15
79
21
Senior Managers2
80
20
77
23
Senior Managers3
73
27
73
27
1. Headcount as at 31 December 2024. Executive Leadership Team as at the date of this report.
2. Data is per s.414C(8) of the Companies Act 2006 and includes subsidiary directors – population of 25 employees.
3. Data as per provision 23 of the UK Corporate Governance Code – population of 114 employees.
40
SIG Annual Report and Accounts 2024
Supporting mental health
in the UK Construction
industry
In 2024 our UK Roofing business began a new
partnership with a charity dedicated to providing
practical, financial, and well-being support to those
in the UK construction industry who are experiencing
challenges. Working with Band of Builders (BOB),
we have used our national branch network to
encourage both our customers
and colleagues to come
together over a cup of tea
to break down the barriers
around mental health and
to provide access to
specialist support
through BOB.
In 2024, SIG Ireland was awarded
a Willing Able Mentoring (WAM)
Leaders Award in recognition of their
employment and support to graduates
with disabilities.
In the UK we have expanded our toolkits
to help line managers better manage
the different needs of their people in the
workplace, from supporting colleagues
with religion-related needs such as fasting
around Ramadan, to gender-specific
health matters such as menopause.
As regards gender diversity, 15% of
our positions at ELT level are held by
females, and females comprise 22%
of our overall workforce. Our latest
gender pay gap report can be found
on our website.
Talent, Leadership & Apprentices
Having great leaders remains a key
enabler in our business. During 2024
we delivered a number of programmes
to develop the skills of our managers
and leaders.
These programmes included leadership
conferences, different training modules
for skills for managers, and a programme
in France to support the development
of junior colleagues and their professional
relationships and to broaden their
understanding of our strategy, operations
and processes. 2024 saw the launch of
our ‘Leadership Academy’ in the UK, a
comprehensive range of programmes
aimed at developing the essential skills
and qualities required to lead effectively
in our dynamic industry.
Our employee survey showed very good
feedback on the performance of our
leaders, with over 92% of our people
having confidence in them and feeling
supported with strong levels of
engagement linked to that.
Learning and Development
In 2024 we have invested over 32,000
hours in learning and development
training across the SIG Group.
This training includes the launch
of our Sales and Operations Academies
in the UK with bespoke focused sales
training and coaching across the
business helping to develop the core
competencies, skills and capabilities
of our people to grow the business
and their careers at SIG.
In 2024 we launched a new Group-
wide interactive learning platform
LearnConnect which allows our people
to navigate their learning more
effectively. In 2024, new learning
modules were added in many
countries on sales skills.
Apprenticeships, Charity
& Community
Our apprenticeship programme
continued in 2024 and we currently
have over 200 apprentices across our
businesses. Our programmes also
include the provision of education, skills
and training to help their jobs within
SIG but also their own professional
development. Our private label brand in
the UK, SR Timber won a UK industry
Training and Apprenticeship Award 2024
for their work in encouraging new people
into the timber and construction industry.
Across the SIG Group, we support various
charities and our local communities in
different ways. For example, in France
we support a range of causes and
programmes including contributing to
the renewal of French forest estates
through local sport participation.
In the UK our activities include donating
to foodbanks to support people in
need in the communities in which our
branches are located. In 2024 we also
launched initiatives to support skin
cancer awareness among our at-risk
roofing contractor customers and
increasing mental health awareness
within the broader building industry.
In Poland we provided support to SIG
flood survivors as a result of severe
flooding experienced in the country.
41
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SIG Annual Report and Accounts 2024
Sustainability review continued
Task Force on Climate-related
Financial Disclosures (TCFD)
The following pages provide an overview of our climate-related risks and opportunities, as well
as our response to mitigate risk and maximise opportunities.
We have complied with the requirements of LR 6.6.6(8)R by including climate-related financial disclosures consistent with the
TCFD recommendations and recommended disclosures. The climate-related disclosures also comply with the requirements of
the Companies Act 2006 as amended by the Companies (Strategic Report) (Climate-related Financial Disclosure Regulations)
2022 (CFD).
TCFD compliance
TCFD disclosure requirement
Pages
Alignment
with CFD
Governance
Disclose the organisation’s
governance around
climate-related risks
and opportunities.
Describe the Board’s oversight of climate-related risks and opportunities.
43
68 to 79
(a)
Describe management’s role in assessing and managing climate-related
risks and opportunities.
44
Strategy
Disclose the actual and
potential impacts of
climate-related risks
and opportunities
on the organisation’s
businesses, strategy,
and financial planning
where such information
is material.
Describe the climate-related risks and opportunities the organisation has
identified over the short-, medium-, and long-term.
45 to 46
(d), (e), (f)
Describe the impact of climate-related risks and opportunities on the
organisation’s businesses, strategy, and financial planning.
47
Describe the resilience of the organisation’s strategy, taking into
consideration different climate-related scenarios, including a 2°C
or lower scenario.
48 to 49
Risk management
Disclose how the
organisation identifies,
assesses, and manages
climate-related risks.
Describe the organisation’s processes for identifying and assessing
climate-related risks.
44
(b), (c)
Describe the organisation’s processes for managing climate-related risks.
44 to 46
Describe how processes for identifying, assessing, and managing
climate-related risks are integrated into the organisation’s overall risk
management.
44
62 to 63
Metrics and targets
Disclose the metrics and
targets used to assess
and manage relevant
climate-related risks and
opportunities where such
information is material.
Disclose the metrics used by the organisation to assess climate-related
risks and opportunities in line with its strategy and risk management
process.
50
(g), (h)
Disclose Scope 1, Scope 2, and if appropriate, Scope 3 GHG emissions,
and the related risks.
30 to 31
Describe the targets used by the organisation to manage climate-related
risks and opportunities and performance against targets.
29
50
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SIG Annual Report and Accounts 2024
Governance
We have aligned our climate change and risk management reporting with the recommendations of the TCFD since 2021.
The frequency of Board meetings is disclosed in the Governance section on page 74.
Board responsibilities related to climate change
Process and frequency
Board: See full explanation of roles and responsibility on page 72 to 73
Responsible for the establishment and oversight of the Group’s purpose,
strategy and behaviours, including:
–overseeing major capital decisions, including acquisitions and divestments,
and investment in alternative fuel vehicles;
–reviewing the annual budget and business plans, including for climate-related
investment and our ESG strategy; and
–monitoring progress against the five sustainability commitments, including
carbon reduction targets.
The Board receive updates from the
Chair of the Sustainability Committee
on a quarterly basis to monitor and
oversee progress against carbon
reduction targets and receive updates
on emerging relevant regulation.
Audit & Risk Committee: See full explanation of roles and responsibility on page 88 to 95
The Audit & Risk Committee has delegated responsibility from the Board to
oversee and review ESG risks including climate change risks.
Updated scenario analysis showing the physical impacts from climate change
in our business and the ESG risk register were reviewed and approved by
the Committee.
The Committee reports annually to the
Board on ESG risks, including climate-
related risks and opportunities.
Remuneration Committee: See full explanation of roles and responsibility on page 102
Responsible for setting relevant ESG-related performance incentives, including
climate-related incentives, for the Board and senior management.
The Remuneration Committee has included an ESG objective within the personal
objectives in the bonus scheme for senior management.
The Remuneration Committee reviews
the Group's performance against carbon
and waste targets to help determine
senior management's achievements
against ESG objectives.
Executive Directors: Includes the CEO and CFO as Executive Directors of the Board. See full explanation of roles and
responsibility on page 70
The CEO is ultimately responsible for delivering the strategy of the Group,
including the management of climate-related risks and opportunities.
The CEO and CFO attend meetings
with senior management to understand
progress against the strategy of the Group.
Management responsibilities related to climate change
Executive Leadership Team
Responsible for the delivery of the Group strategy alongside management of operational issues, including climate-related
risks and opportunities. The ELT meets on a regular basis. The ELT ensures that performance is measured against our
sustainability commitments.
Several ELT members were involved in the CSRD project including preparing a double materiality assessment in advance
of future CSRD reporting requirements.
Sustainability Committee: Meets monthly
The Committee includes representatives from the ELT including the CFO, CPO, HSE Director and Company Secretary.
Sustainability leads from each operating company also attend the meetings.
Monthly carbon, waste and fleet metrics are presented during the Committee meeting. Performance is reviewed against
budget and historic data to monitor progress towards medium- and longer-term carbon reduction targets.
The Sustainability Committee shares information about climate-related issues, including emerging regulation. The
Committee is supported by dedicated working groups on fleet and waste.
Operating company Managing Directors
Each Managing Director is responsible for embedding the Group sustainability strategy into the local operating companies.
This means they consider local markets and regulations.
The Managing Directors complete biannual risk reviews. This includes the assessment and management of climate-related
issues and other ESG topics.
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Sustainability review continued
TCFD continued
Risk management
Climate change risks crystallise over a longer time period than our typical risk management framework considers. For this
reason, we have a climate risk review incorporating the recommendations of the TCFD. We combine a Group-level strategic
review with a bottom-up operation view of these risks impacting each of our businesses.
Risk identification
–Group-led review of risk register
focusing on likely financial,
regulatory and operation impacts
that could have a material
financial impact
–After completing scenario analysis,
we reviewed the completeness of
our TCFD risk register
Risk assessment
–The climate risks have been
assessed using the same risk
thresholds as the principal
risk register
–Where possible, we have
completed financial analysis to
project the potential size and scope
of the risks identified. For example,
compliance costs for emerging
regulation
Risk approval
–The outputs of the risk review
exercise are consolidated with our
principal climate risks and reviewed
by the ELT and Sustainability
Committee
–The Audit & Risk Committee signs
off the TCFD risk register and
reviews the TCFD disclosure
Whilst the Board recognises that to achieve its strategic objectives it must accept and manage a certain degree of risk, it has a
low appetite for risks that have significant negative consequences. We assign a risk comfort level to inform approaches to either
mitigate, transfer, accept or control the risks. Our mitigations are included within the risk tables on page 45 and 46.
Integration with our enterprise risk framework
Our approach to overall risk management is detailed from page 62. The Group employs a three lines model to provide a simple
and effective way to enhance risk and internal control management processes and ensure roles and responsibilities are clear. In
2024, we took additional steps to integrate climate-related risks into this process, including updating our risk thresholds to align
to the principal risk register. ESG is a principal risk and is managed through the three lines model. This means we consider the
relative significance of climate-related risks in relation to other risks using the same risk thresholds.
Strategy
Transition and physical risks from climate change can cause risks and opportunities. We have considered the impact of climate
change across our value chain. All business areas, operating locations and product types have been considered in our climate
risk assessment. Overall, our operating companies face common climate-related risks and opportunities.
Time horizons considered in our climate risk assessment:
Short-term
3 years
Aligned with our viability review period.
Medium-term
4-10 years
Aligned with our net zero commitment
in 2035.
Long-term
10 years +
Longer-term view aligned with national
carbon commitments.
In our risk assessment, we have considered the impact and likelihood of the risk. The risk thresholds for impact and likelihood
are aligned with our enterprise risk management framework on page 62. Risks assessed as moderate or above are included in
the risk tables.
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SIG Annual Report and Accounts 2024
Our climate-related risks
The table below shows the climate-related transition and physical risks impacting the Group, the effect on strategy and financial
performance, and mitigating actions.
Transition risk
Impact
Mitigation
1: Decarbonisation of our fleet
Short-, medium- and long-term risk
Fuel from our fleet and operations contributes 91%
of our Scope 1 and 2 total emissions. Therefore,
the decarbonisation of our fleet is crucial to our net
zero ambitions.
There is uncertainty regarding the future technology
for our fleet, especially heavy-duty vehicles.
This risk is greatest in the UK, France, Germany and
Poland where we own or lease our heavy-duty fleet.
Because of government incentives and infrastructure
investment, the best low-carbon fleet option may differ
across our operating companies.
This risk is exacerbated by the short-term price
challenges of HVO in the UK compared to current
diesel prices. While we remain committed to HVO as
an option in the medium-term, our short-term usage will
be reduced.
Major
impact
We may have increased lease
payments because the relative cost
of alternative fuel vehicles is greater
than diesel alternatives on the market.
However, we expect the retail price
of electric and hydrogen vehicles will
decrease over time.
–Trialling alternative fuel
fleet, including hydrogen,
electric, and bioCNG
–We continue to work
with fleet partners and
manufacturers to assess
the most viable long-
term alternatives
2: Product carbon and environmental performance
Short-, medium- and long-term risk
There is a risk that we do not have access to detailed
product or manufactures’ data to satisfy customers
or regulatory requirements for environmental
product information.
The environmental performance of structural insulation
and construction accessories delivers a significant
proportion of our Scope 3 emissions. A lack of
innovation in product manufacturing will leave carbon
emissions and embodied carbon at
current levels.
Moderate
impact
Customers could purchase products
from a competitor if we cannot provide
sufficient information on environmental
product performance.
There may be additional costs to
review suppliers' environmental
product information or other
certification or compliance costs.
–Engaging with our key
manufacturing partners
to ensure sustainability
data and the long-term
decarbonisation of
products are considered
as part of the ongoing
development of the
customer proposition
3: Energy management and infrastructure
Medium- and long-term
Energy security means having a reliable and stable supply
of electricity that can always meet our demands at an
affordable price. The IEA expects in all three climate
scenarios in the World Energy Outlook that electricity
demand will increase by 2030 and 2050, but the increase
in renewable energy may create seasonal variations in
energy supply.
We expect our demand for electricity to increase because
we will have more electric vehicles charged at branches.
New infrastructure may be required to increase grid
capacity or supply.
This risk is greater in Poland, where local distribution
networks may require significant state intervention to
ensure they can meet future transmission needs.
Moderate
impact
Additional investment may
be required to install charging
infrastructure or increase electricity
supply capacity to our branches.
We expect our demand for electricity
will increase if we are charging electric
heavy-duty vehicles on site.
–All new branches have
sustainable low-carbon
features where
commercially viable,
including LED lights
and solar panels
–Improving energy
efficiency will reduce
electricity demand
4: Emerging regulation and compliance
Short- and medium-term
The UK government, EU Commission and national
governments may introduce additional policies to
support the climate transition. Examples of regulations
include additional sustainability reporting requirements,
emissions trading schemes and waste take-back
requirements.
Moderate
impact
Our compliance, assurance and
operational costs may increase to
respond to new and emerging
regulation.
–Early preparation to
identify and forecast
costs to implement
new regulation
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TCFD continued
Sustainability review continued
Physical risk
Impact
Mitigation
1: Climate-related working conditions for our
Medium- and long-term
workers and construction sector
Labour productivity may be impacted because of extreme
heat, impacting working patterns in the construction sector.
The more volatile weather patterns impact the market
demand and our ability to forecast sales. Roofing
businesses are more sensitive to weather conditions.
Extreme heat or storms could also disrupt sales.
Moderate
impact
We would expect the construction
sector to adapt working hours. There
could be an impact on cash flow
because in summer months fixed costs
remain despite lower demand.
Seasonal extreme weather could
impact our ability to forecast sales
in our roofing businesses.
–Working hours may be
adapted if there is
extreme mid-day heat
2: Product climate change vulnerability
Long-term
There is a risk that physical climate risk events impact
our suppliers and the wider logistic sector. For example,
the seasonal impact of precipitation in future climate
scenarios leads to increased rainfall in winter and periods
of droughts in the summer. This may impact product
supply or lead to cost increases.
Moderate
impact
The impact of droughts may lead
to product shortages or delays in
our upstream logistics. We may
experience reduced revenue if other
companies can supply customers
with these products. We may have
to increase stock management for
higher risk products.
–Reviewing the impact of
climate change on key
product groups, for
example timber
–We can pivot to new
suppliers and supply
routes should a
significant event occur
due to our diversified
supply base
3: Branch impact from climate change
Medium- and long-term
Flooding may damage our branches. We could be
exposed to flooding and other precipitation events due to
severe rain and storms. We experienced a flood event in
Poland this year, leading to damaged stock and branch
facilities and lost revenue as the branch closed for repairs.
Moderate
impact
Insurance premiums may increase or
become commercially unviable as
climate risks materialise. In this case,
we may need to break our leases in
high premium locations to find
alternatives.
–Disaster recovery plans
include processes to
follow after a flooding
event
–Physical climate risks,
including flooding,
are considered when
selecting new branch
locations
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SIG Annual Report and Accounts 2024
Our climate-related opportunities
1. Responding to regulations to improve the energy performance of building
Moderate
impact
Regulations to improve the sustainability or energy efficiency of buildings presents an opportunity for our business. A growth in
the retrofit market could lead to increased revenue for insulation and other energy efficiency products. There are also potential
commercial opportunities resulting in an increased demand for data driven technical advice on the carbon performance of
specific products. A shift to lower-carbon heat sources for homes and an increase in climate-driven weather events will require
better insulation and building envelope products.
2. Growth of new and sustainable products
Major
impact
Several of our products will support the built environment by providing more sustainable product options. These include:
–Insulation – new lower-carbon insulation products have been introduced such as wood fibre insulation and sheep’s
wool insulation
–Sustainable roofing solutions – we are expanding and promoting our sustainable roofing solutions including lightweight
synthetic roof tiles, natural slate tiles, green/brown roofs and single-ply membranes
–Solar panel market growth and innovation – supported by legislation and higher energy costs. We have expanded our capacity
to offer solar solutions for pitched roofs, flat roofs and industrial buildings
–Drylining innovations – supporting emerging suppliers in low-carbon plasterboard solutions and steel for stud and track walls
We are partnering with our network and customer bases to bring new sustainable products to market.
Impact on strategy and financial planning
The climate-related risks and opportunities have the potential to impact our business, strategy and financial planning.
Financial planning
Going concern and
long-term viability
We consider the impact of climate change in our going concern assessment. The current
conclusion is that there is no significant risk of climate change causing a downturn in cash flows
across the Group.
Decarbonisation and
investment into fleet
We have an annual budget process that includes investments into lower-carbon technology and
increased operating expenditure from electricity usage. We expect the largest financial impact from
our carbon-related risks is the cost involved with decarbonising our fleet. We do not have any
investment in research and development due to our business model.
Adaptation actions
and operating
expenses
In the year, a branch in Poland experienced a flooding event. This caused inventory loss, and
the branch was closed for refurbishment. In the UK, considerations of climate impacts, particularly
flood risk, resulted in a relocation of a branch. We continue to work with our landlords and local
council to ensure that flooding risks are considered and mitigated.
Acquisitions and
divestment
Our Polish business acquired new branches in 2024. Our ESG leader in Poland was involved in the
due diligence to review the impact of the acquired business on our sustainability objectives.
Products and
services
We work with supply chain partners to align our products to customer demands, including offering
lower-carbon alternatives. In the UK, we have supported the wider sector by offering training
sessions for roofers to install solar panels.
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TCFD continued
Sustainability review continued
Business and strategy
SIG plays an important role in helping to make the built environment more sustainable as a leading specialist distributor of
insulation and other products for sustainable buildings across Europe. We have highlighted three key areas to progress our
strategy across all climate scenarios:
–Distributing products to improve the energy efficiency and sustainability of buildings paired with accurate and complete
product information to enable customers to make informed decisions on the best product for their building project
–Leveraging our industry position to bring to market more sustainable products to reduce the embodied carbon of buildings
–In developing our approach to our climate transition, we have considered commitments made to a net zero economy, including
the UK Climate Change Act 2008 and the European Union Green Deal commitments. Our commitment to grow sustainably
as a responsible business includes decarbonising our transport fleet as and when suitable technologies become available
Climate resilience assessments
We have developed our approach to scenario analysis for physical climate risks this year. We reviewed the impact of climate change
in our operating countries. Using the findings from the review, we assessed the potential impact on our branch locations from:
–decreasing labour productivity due to heat stress;
–flooding; and
–five-day extreme rainfall.
As required, we have assessed our climate resilience using publicly available scenarios from the IEA and the Network for
Greening the Financial System ("climate scenarios"). We have selected the scenarios to provide a contrasting perspective to
consider a below 2°C aligned scenario and a scenario with greater physical risks of climate change.
There are limitations with this approach – the climate scenarios may not provide data with sufficient granularity as data sets are
at a global or regional scale. We have considered different data sets for the transition and physical risks due to the relevance of
their impacts on our business.
Climate scenario analysis
Scenario
Net Zero Emissions by 2050 ("NZE")
Net Zero Emissions Not Achieved ("Stated Policies")
Climate scenario
Net zero emissions reached by 2050, giving at
least a 50% change of limiting global warming
to below 1.5°C by 2100 with limited overshoot
in earlier years. Physical risks are relatively low,
but transition risks are high.
Emissions grow until 2080 leading to over 3°C of
warming by 2100. There are increased physical
risks including irreversible changes like higher sea
level change.
Description
The scenario provides a roadmap to achieve
net zero emissions produced by the IEA.
This considers the factors to decarbonise
the global scenario.
This scenario reflects current world conditions to
provide an outlook of a failure to meet our net zero
targets. There is a higher impact from physical
climate change.
Assumptions
–In 2030, fossil fuels remain the dominant fuel
for transport. However, the proportion of
electricity and bioenergy used for transport
increases rapidly
–Additional carbon price schemes introduced
and increase the relative cost of fossil fuels
–There is a political focus on building energy
efficiency and renewable electricity
production. Total energy supply in 2050 is
equal to 2010
–A broad range of policies are introduced to
manage and reduce emissions. Emission
trading schemes are applied to additional
sectors, including transport
–Oil demand peaks by 2030, but there is a slow
decline from the peak compared to the NZE
scenario
–Only existing and scheduled carbon price
schemes are in place, and the overall carbon
price is lower than in the NZE scenario
–Less investment in clean energy leading to higher
total lifetime costs for battery products, electric
vehicles and heat pumps
–Physical impacts of climate change are
significantly greater, including extreme
temperatures, increased precipitation,
ground flooding and a rise in sea levels
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SIG Annual Report and Accounts 2024
In this section of the report, we highlight the material risks based on the scenario analysis and highlight any additional impacts
or resilience strategies considered.
Net Zero Emissions by 2050
Our analysis shows we have a moderate risk exposure in the medium-term. The table summarises the risks with the greatest
impact in the Net Zero Emission scenario.
Climate-related risks or
opportunities
Impact in scenario
Impact on strategy and resilience
Decarbonisation
of our fleet
Investment is required to decarbonise our fleet,
including heavy-duty vehicles. The IEA scenario
highlights that the dominant fuel for transport
will be oil until early 2030. We would expect the
largest proportion of the investment to be made
from 2030 onwards to meet our carbon
reduction target.
–The decarbonisation of our fleet is a viable
strategy, assuming there is a reasonable
period to make the investments required. If the
transition period was shortened further, for
example by government regulation, there may
be a negative impact on short-term operational
and financial performance due to the lack of
viable alternative low-carbon transport options
Emerging
regulation
impacting product
carbon and
environmental
performance
We expect additional regulation could impact our
business or change the product mix sold in our
operating markets. An increased carbon tax, for
example on transport emissions, would increase
our operating expenses for any remaining
combustion engine vehicles in operation.
Changes to legislation related to products relies
on compliance from supply chain partners.
–Emerging regulation may impact suppliers
of carbon intensive products
–Regulation that increases the demand for
energy efficient or renewable energy products
may increase our sales ahead of forecasts.
Our ongoing forecast and budget process
will capture this
Net Zero Emissions Not Achieved
Our analysis shows we have a moderate risk exposure in the medium- to long-term. The table summarises the risks with the
greatest impact in the Net Zero Emissions Not Achieved scenario.
Climate-related risks or
opportunities
Impact in scenario
Impact on strategy and resilience
Decarbonisation
of our fleet
The current charging infrastructure in our
operating countries would not be sufficient to
meet the logistic requirements of our business.
There would also be slower advancements in the
range of electric heavy-duty vehicles and the
availability of hydrogen vehicles.
–It is unlikely that we would achieve our net zero
commitment due to current availability of
technology, infrastructure availability and
commercially unviable costs
–We continue to engage with vehicle
manufacturers and trial vehicles to monitor
industry developments
Branch impact
from climate
change
The impact of climate change, due to extreme
weather and heat, is expected to be greater in this
scenario. For example, periods of heavy rain could
increase the risk of flooding. The climate scenarios
show the greatest increase in heavy rainfall across
our operating locations is expected in the South
of Poland.
–We can temporarily service customers from
other locations in the event of flooding
Increased risk
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TCFD continued
Sustainability review continued
Overall resilience of our business model
Pages 45 and 46 summarise our climate-related risks and the mitigations in place to reduce the residual risk to an acceptable
and low level. The removal of fossil fuels from our vehicle fleet remains the greatest risk within the climate-related risk
assessment. There are limited commercially and operationally viable alternatives to diesel heavy-duty vehicles, but we expect
there to be improvements to low-carbon alternatives in the medium-term. The Group's long-term strategic objectives support
the delivery of our sustainability objectives. We expect there to be opportunities from the transition to a lower-carbon economy,
including the increased demand for sustainable and energy efficient building products.
Metrics and targets
The table below shows the key metrics that we monitor to manage climate-related risks. The fleet mix and GHG emission
metrics are presented at the Sustainability Committee meeting and assessed against budget and prior performance.
Where the metrics are reported externally, we have included prior-year comparison.
Metric
Description
Use
Linked to risk or opportunity
Scope 1, 2 and limited
Scope 3 emissions
Full methodology and
reporting boundary is
included on page 30 and
aligns to the GHG protocol.
We completed a full Scope 3
assessment in 2023.
Reported on pages 30 and 31.
Monitored in monthly
sustainability meetings
and within Board sustainability
updates.
Decarbonisation of our fleet.
Total energy consumed
We report total energy
consumed in our energy and
carbon report on page 31.
Reported on page 31.
Energy management and
infrastructure.
Fleet fuel mix
We review the proportion of
combustion engine, electric,
hydrogen and CNG vehicles.
Reported on page 28.
Monitored in monthly
sustainability meetings
and by the Board as a KPI
related to overall carbon
reduction targets.
Decarbonisation of our fleet.
We have an ESG objective and underpin within executive remuneration, with the details on page 114. We do not have an internal
carbon price but have reviewed potential future carbon prices in our scenario analysis.
Targets
We set our carbon reduction target in 2021 as part of our sustainability commitments to become a net zero organisation
operationally by 2035. This includes Scope 1, Scope 2 and business travel emissions. Our climate-related target is supported
by interim milestones detailed on page 29.
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SIG Annual Report and Accounts 2024
SIG continues to integrate ESG responsibility across the Group, and we are committed to socially responsible business
practices for our shareholders, employees, customers and suppliers.
This section constitutes SIG Plc’s Non-Financial Information Statement and is produced to comply with Sections 414A and 414B
of the Companies Act 2006.
In compliance with the Non-Financial Reporting Directive, the table below summarises the requirements and where relevant
information can be found within the Annual Report and Accounts.
Further information on our sustainability policies and corporate responsibility can be found on our website.
Reporting requirement
Relevant policies
Where to find more information
Environmental matters
–Group Sustainability Policy
Sustainability commitments (pages 26 to 41)
Climate-related disclosures (pages 42 to 50)
Employees and
social matters
–Code of Conduct
–Diversity, Equality and Inclusion ("DEI") Policy
–Health and Safety Policy
–Health and Wellbeing Policy
–Modern Slavery Statement
People commitment (pages 38 to 41)
Board diversity (page 85)
Employee engagement (page 75)
Health and safety (page 36 to 37)
Human rights
–Code of Conduct
–Modern Slavery Policy
–Ethical Trading and Human Rights Policy
People commitment (pages 38 to 41)
Stakeholder engagement (pages 76 to 77)
Anti-bribery and
corruption
–Anti-bribery & Corruption Policy
–Whistleblowing Policy
–Payment Practices
Governance (pages 68 to 83)
Description of
business model
Business model and strategy (pages 24 to 25)
Policy, due diligence
and outcomes
Policies are listed above and on our website
Non-financial KPIs
Key performance indicators (pages 52 to 53)
Principal risks and
uncertainties
Principal risks (pages 64 to 67)
UK Climate-related
financial disclosures
Climate-related disclosures (pages 42 to 50)
Group Non-Financial and
Sustainability Information Statement
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Key performance indicators
How we performed
Non-financial KPIs
Lost time injury
frequency rate
2024
8.0
8.4
2023
11.1
2022
8.0
Definition
The ratio of any injury to an employee (including
a contractor) resulting in any lost time per
1,000,000 hours worked – on a 12-month
rolling basis.
2024 performance
A further 5% reduction in our injury frequency
rate in 2024. This trend has been driven by
another year of significant improvements
in France.
Link to strategy
Link to risks
– Health and safety
– Attract, recruit and retain our people
– Environmental, social and governance
Link to remuneration
Health and safety measures in annual
bonus scheme.
Net Promoter Score
(NPS)
2024
+51
+50
+46
2022
2023
+51
Definition
NPS is a customer experience metric based
on their likelihood to recommend SIG. It is
calculated by subtracting the percentage of
customers who answer the question with a
6 or lower from the percentage of customers
who answer with a 9 or 10. This is externally
monitored by a third-party company.
Our Group NPS is the average of NPS
in each operating company.
2024 performance
2024 sees a stable overall Group score, noting
the market backdrop context. This was driven
by good gains in Germany and France Exteriors,
as well as in UK Roofing and France Interiors.
This offset some reductions in Ireland and
UK Interiors.
Link to strategy
Link to risks
– Digitalisation
– Macroeconomic uncertainty
– Change management
Link to remuneration
Customer engagement progress forms
part of the personal objectives of senior
management.
GHG emissions per
£m of revenue
(metric tonnes)
2024
16.9
17.1
17.5
2022
2023
16.9
Definition
Metric tonnes of GHG emissions per £m
of revenue.
2024 performance
In 2024 we have further lowered our emissions
to 16.9 metric tonnes per £m of revenue, from
17.1 in 2023. This has been driven by our 7%
reduction in net zero carbon emissions, due to
incremental improvement in fleet efficiency and
due to lower delivery volumes.
Link to strategy
Link to risks
– Environmental, social and governance
– Legal or regulatory compliance
Link to remuneration
Improving carbon emissions is included in
the personal objectives of certain senior
management.
Employee engagement
result
(ePNS)
2024
+9
+14
+14
2022
2023
+9
Definition
eNPS is an employee experience metric
based on their likelihood to recommend
SIG as an employer.
2024 performance
Our eNPS employee engagement score has
dropped slightly year on year, while remaining
in positive territory. This change includes the
impact of challenging market conditions and
restructuring initiatives across the Group.
Improvements in eNPS were seen around
culture and around the quality of employees'
line managers.
Link to strategy
Link to risks
– Health and safety
– Attract, recruit and retain our people
– Environmental, social and governance
Link to remuneration
Employee engagement progress forms
part of the personal objectives of senior
management.
52
SIG Annual Report and Accounts 2024
Our long-term strategic objectives
Partner of choice
for specialist
contractors
Improving
our operating
performance
Growing sustainably
as a responsible
business
Financial KPIs
Like-for-like sales
(%)
2024
(4)
(2)
17
2022
2023
(4)%
Definition
The growth or decline in sales per day (in
constant currency) excluding any current and
prior year acquisitions. Sales are also adjusted
for branch openings or closures, a change since
2023. 2023 has been restated on this basis.
See page 184 for the calculation.
2024 performance
Challenging market conditions led to lower
sales volumes, and some negative pricing
impact on revenue also. Relative to the market,
a robust trading result supported by continued
strong execution.
Link to strategy
Link to risks
– Macroeconomic uncertainty
– Attract, recruit and retain our people
– Change management
Link to remuneration
Profit measures in annual bonus scheme.
Gross margin
(%)
2024
24.5
25.3
25.9
2022
2023
24.5%
Definition
The calculation of underlying gross profit divided
by underlying revenue. Underlying revenue and
gross profit represents amounts from continuing
operations excluding amounts from non-core
businesses and Other items, as shown on the
Consolidated income statement.
2024 performance
The reduction in gross margin was due to
greater than normal pricing pressure as a
result of the weak demand environment.
The businesses continue to manage these
dynamics effectively.
Link to strategy
Link to risks
– Macroeconomic uncertainty
– Data quality and governance
– Digitalisation
– Change management
Link to remuneration
Profit measures in annual bonus scheme.
Operating margin
(%)
2024
1.0
1.9
2.9
2022
2023
1.0%
Definition
The ratio of underlying operating profit divided
by underlying revenue. Underlying operating
profit represents operating profit from continuing
operations excluding amounts from non-core
businesses and Other items. See page 185 for
the calculation.
2024 performance
Operating margin decline driven by lower sales
volumes and price pressure in weaker markets,
leading to underlying operating profit of £25.1m,
down from £53.1m in 2023. This included some
mitigation through restructuring and a reduction
in underlying operating costs.
Link to strategy
Link to risks
– Macroeconomic uncertainty
– Attract, recruit and retain our people
– Digitalisation
– Change management
Link to remuneration
Profit measures in annual bonus scheme.
Average trade working
capital to sales ratio
(%)
2024
13.9
14.3
14.6
2022
2023
13.9%
Definition
The average closing trade working capital
balance of each calendar month of the year,
divided by underlying revenue. Trade working
capital includes net stock, net trade recievables,
gross trade creditors and supplier rebates due.
2024 performance
Further incremental improvement in 2024 which
highlights continuing balance sheet discipline
against a backdrop of prolonged challenging
market conditions.
Link to strategy
Link to risks
– Macroeconomic uncertainty
– Change management
Link to remuneration
Included in operating company annual
bonus schemes.
53
Strategic Report
Governance
Financials
SIG Annual Report and Accounts 2024
Financial review
Continued financial
discipline
The Group managed effectively the
impact of challenging market conditions
during 2024. The impact of declining
volumes and falling prices were
mitigated by extensive cost reduction,
including ongoing restructuring and
productivity initiatives. These actions
also position the business to deliver a
step-up in profitability when markets
return to growth. The Group has
maintained robust liquidity, and
successfully refinanced its €300m bond
and £90m RCF in October 2024, with
these facilities now maturing in 2029.
Revenue
Group revenue of £2,611.8m (2023:
£2,761.2m) was 5% lower on a reported
basis, including a negative 1% impact
from foreign exchange rates, a 1%
increase from differences in the number
of working days and a net 1% negative
impact from branch closures and
openings.
LFL revenues, which are now adjusted
to exclude the impact of branch closures
and openings, reduced by 4% year-on-
year. Within this 4%, the impact of sales
price deflation was approximately 3%,
about two thirds of which was related to
input cost deflation, and there was a
decline in volumes of approximately 1%.
Operating costs and profit
Gross profit decreased 8.5% to
£640.0m (2023: £699.6m) with a gross
profit margin of 24.5% (2023: 25.3%).
The reduction in gross margin reflects
greater than normal pricing pressure
as a result of the weak demand
environment. The businesses continue
to manage these dynamics effectively
and were able to offset the volume
weakness in part through mix benefits.
The Group’s underlying operating costs
decreased by 4.9% to £614.9m (2023:
£646.5m). The decrease was primarily
due to operating cost initiatives,
including restructuring actions taken
from H2 2023 onwards, and partly due
to lower volumes. These benefits were
partially offset by operating cost
inflation, with the biggest impact being
on wages and salaries. The movement
in year over year operating costs was
also affected by a one-off £3.7m profit
recorded in 2023 from the sale of the
former French Roofing head office
building in Angers.
The Group’s underlying operating profit
decreased to £25.1m (2023: £53.1m), at
an operating margin of 1.0% (2023:
1.9%). Reported operating loss was
£3.8m (2023: £4.0m profit) after Other
items of £28.9m (2023: £49.1m). Other
items includes £13.4m restructuring
costs, £3.9m refinancing costs and a
£7.3m non-cash impairment in the UK
Interiors business.
The impact of declining revenues
was mitigated by extensive cost
reduction, and these actions
also position the business to
deliver a step-up in profitability
when markets return to growth.
Alongside that, the successful
refinancing provides stability
and ongoing liquidity.
Ian Ashton
Chief Financial Officer
54
SIG Annual Report and Accounts 2024
Segmental analysis
UK
Revenue
2024
£m
Revenue
2023
£m
LFL sales
vs 2023
Underlying
operating
(loss)/profit
2024
£m
Underlying
operating
(loss)/profit
2023
£m
UK Interiors
495.0
556.5
(10)%
(3.5)
(1.6)
UK Roofing
380.6
369.4
2%
13.2
10.6
UK Specialist Markets
238.1
247.6
(5)%
4.8
10.3
UK
1,113.7
1,173.5
(5)%
14.5
19.3
Revenue in UK Interiors, a specialist insulation and interiors distribution business, decreased to £495.0m (2023: £556.5m).
Revenue was 11% lower year-on-year due to the impact of a decline in market volumes and input price deflation in a very
competitive market. The drop in sales included a c3% reduction related to branch closures within a wider programme of
strategic initiatives that are underway to transform the performance and profitability of this business over the medium-term. LFL
revenue declined 10%. The H1 LFL decline of 13% reduced to an H2 decline of 6%, reflecting a softening in comparables as
well as a stablisation in absolute volumes in H2. The decline in revenue, together with pricing pressure affecting gross margin,
partially offset by operating cost reductions, resulted in an underlying operating loss of £3.5m (2023: £1.6m).
Revenue in UK Roofing, a specialist roofing merchant, increased by 3% to £380.6m (2023: £369.4m), with LFL revenue up 2%.
This was driven by a strong sales performance relative to a weak UK market, as a result of the business’s early successful
execution of its multi-year programme of business development and growth initiatives. In particular, H2 LFL growth of 5%
reflected a robust outperformance of its market as well as the lapping of a weaker prior year comparative. Full year volume
growth was only partially offset by a small purchase price deflation headwind. A small reduction in gross margin due to pricing
dynamics was offset by operating cost reduction, and resulted in improved underlying operating profit of £13.2m (2023:
£10.6m).
Revenue in UK Specialist Markets decreased to £238.1m (2023: £247.6m). LFL revenue declined 5%, driven by a softer market,
and by input price deflation in steel, which is a bigger element of these businesses than elsewhere in the Group. H1 LFL revenue
decline of 7% eased to a decline of 2% in H2, due to a stabilisation in market conditions and the effect of weaker prior year
comparables. These factors, coupled with operating cost inflation, resulted in a reduction in underlying operating profit to £4.8m
(2023: £10.3m).
France
Revenue
2024
£m
Revenue
2023
£m
LFL sales
vs 2023
Underlying
operating
profit
2024
£m
Underlying
operating
profit
2023
£m
France Interiors
200.4
218.9
(7)%
6.2
10.4
France Roofing
410.1
458.0
(8)%
8.0
19.3
France
610.5
676.9
(8)%
14.2
29.7
France Interiors, a structural insulation and interiors business trading as LiTT, saw reported revenue decrease by 8% to
£200.4m (2023: £218.9m), and by 7% on a LFL basis, with the rate of decline steady between H1 and H2. This was driven by
lower market demand and volumes together with input price deflation, as opposed to the price inflation seen in 2023. The
revenue decline, coupled with increased margin pressure, was partially mitigated by various actions to reduce operating costs,
and resulted in a £4.2m decrease in underlying operating profit to £6.2m (2023: £10.4m).
Revenue in France Roofing, a specialist roofing business trading as Larivière, decreased by 10% to £410.1m (2023: £458.0m),
and by 8% on a LFL basis, including a small impact of strategic branch closures made during the year. Demand and volumes
were lower for the year due to continued softening of the residential new-build market and input price deflation. The H1 LFL
revenue decline of 11% eased to a decline of 5% as the business lapped the weak H2 comparator in the prior year, and as
volumes saw some stablisation. The decrease in revenue and reduced gross margin was partially offset by reduced operating
costs, resulting in an underlying operating profit decrease of £11.3m to £8.0m (2023: £19.3m). The year on year change in
underlying operating profit includes the one-off operating profit benefit in H2 2023 of £3.7m from the sale of the business’s
former headquarters in Angers.
Revenue
£2,611.8m
2023: £2,761.2m
Gross margin
£24.5%
2023: 25.3%
Net debt
£497.3m
2023: £458.0m
Underlying operating profit
£25.1m
2023: £53.1m
55
Strategic Report
Governance
Financials
SIG Annual Report and Accounts 2024
Germany
Revenue
2024
£m
Revenue
2023
£m
LFL sales
vs 2023
Underlying
operating
profit
2024
£m
Underlying
operating
profit
2023
£m
438.5
462.1
(2)%
4.7
15.6
Revenue in Wego/Vti, our specialist insulation and interiors distribution business in Germany, decreased by 5% to £438.5m
(2023: £462.1m), including a small impact from closures of underperforming branches. LFL revenue decreased 2%, with
deflation being offset by marginal volume growth, the latter despite weaker market conditions in the very subdued German
construction market. H2 was slightly better than H1 due to the lapping of softer prior year comparators. Despite the headline
LFL decline and consequential impact on profitability, the business continued to demonstrate very positive momentum and
execution on strategic initiatives during the year. Gross margin also declined due to increased price competition, whilst
operating costs increased, with restructuring partially offsetting inflation. This resulted in reduced underlying operating profit
of £4.7m (2023: £15.6m).
Poland
Revenue
2024
£m
Revenue
2023
£m
LFL sales
vs 2023
Underlying
operating
profit
2024
£m
Underlying
operating
profit
2023
£m
241.4
237.9
(2)%
4.6
7.1
In our Polish business, a market-leading distributor of insulation and interiors, revenue increased to £241.4m (2023: £237.9m),
including a c1% increase due to two new branches. LFL sales decreased by 2%. LFL growth shifted from 3% growth in H1 to
a 7% decline in H2, as the H1 benefit of government housing stimulus slowed and macroeconomic factors saw a sequential
weakening in construction market demand. This was more marked in Q3, and Q4 saw some stablisation. The full year decline
was primarily driven by input price deflation, with underlying volumes growing. Together with operating cost inflation, partially
offset by gross margin improvement, this resulted in a reduction in underlying operating profit to £4.6m (2023: £7.1m).
Benelux
Revenue
2024
£m
Revenue
2023
£m
LFL sales
vs 2023
Underlying
operating
(loss)
2024
£m
Underlying
operating
(loss)
2023
£m
103.6
116.9
(8)%
(4.5)
(3.0)
Reported revenue from the Group’s business in Benelux decreased to £103.6m (2023: £116.9m) with a c1% impact from the
strategic decision to close seven branches in Q4. LFL revenue was down 8%, with the H1 LFL decline of 12% improving to a
decline of 4% in H2. The revenue decline resulted from continued market softness, albeit this saw some stabilisation due to
lapping of comparables in H2. The profit impact of this was only partially offset by operating cost savings, resulting in an
underlying operating loss of £4.5m (2023: £3.0m).
Ireland
Revenue
2024
£m
Revenue
2023
£m
LFL sales
vs 2023
Underlying
operating
profit
2024
£m
Underlying
operating
profit
2023
£m
104.1
93.9
13%
3.3
1.4
Our operations in Ireland comprise a specialist distributor of interiors and exteriors, and three separate specialist contracting
businesses offering office fit-out, industrial infrastructure coatings services and kitchen/bathroom interiors fit out. Reported
revenue increased by 11% to £104.1m (2023: £93.9m), and by 13% on a LFL basis. This was partially a result of improved
market conditions after a very weak 2023, but also due to good execution of commercial initiatives to improve profitable
market share. Underlying operating profit increased as a result to £3.3m (2023: £1.4m).
Financial review continued
56
SIG Annual Report and Accounts 2024
Reconciliation of underlying to statutory result
Other items, being items excluded from underlying results, amounted to £30.5m for the year (2023: £49.3m) on a pre-tax basis.
The key comparable changes in Other items year-on-year are the higher prior year impairment charge in 2023, the one-off costs
of refinancing in 2024, and higher restructuring costs in 2024. The numbers for both years are summarised in the table below:
2024
£m
2023
£m
Underlying (loss)/profit before tax
(14.3)
17.4
Other items – impacting profit before tax:
Amortisation of acquired intangibles
(2.1)
(2.8)
Impairment charges
(7.3)
(33.8)
Cloud based ERP implementation costs
(1.0)
(2.2)
Costs associated with acquisitions
—
(3.2)
Net restructuring costs
(13.4)
(8.0)
Onerous contract costs
—
(0.2)
Costs associated with refinancing
(3.9)
—
Other specific items
(1.2)
1.1
Non underlying finance costs
(1.6)
(0.2)
Total Other items
(30.5)
(49.3)
Statutory loss before tax
(44.8)
(31.9)
Other items are disclosed separately in order to provide a better indication of the underlying earnings of the Group. Further details
of other items in 2024 are as follows:
–Impairment charges in the year relate to right-of-use asset impairment in the UK Interiors business.
–Net restructuring costs in the year comprise £6.5m redundancy and related staff costs and £6.9m branch closure costs,
including £2.9m impairment of right-of-use assets and tangible fixed assets, all related to restructuring across the Group.
– Costs associated with refinancing in the year relate to the new €300m bond issuance and the extension of the RCF. These
consist of £3.9m of transaction costs, and also a £1.4m write-off of unamortised fees, included within non-underlying finance
costs in the above table, relating to the prior refinancing in 2021.
– Cloud based ERP implementation costs relate to project configuration and customisation costs associated with strategic cloud
computing arrangements, which are expensed, rather than being capitalised as intangible assets.
–Other specific items comprises the estimated impact of a property lease dispute, including impairment of right-of-use and
fixed assets of £0.7m, and costs relating to an investment property no longer in use by the Group.
Taxation
The effective tax rate for the Group on the total loss before tax of £44.8m (2023: £31.9m loss) is a “negative tax rate” of 8.5%
(2023: negative 36.1%).
The tax charge for the year of £3.8m is related to taxable profits made in the majority of our EU markets. Tax losses in the UK
and Benelux, which cannot be surrendered or utilised cross border, are not currently recognised as deferred tax assets, and
this impacts the effective tax rate. Due to a reduction of the profit before tax in the overseas operating companies and the
ongoing losses in the UK, the Group has generated an overall loss before tax which, alongside the positive P&L tax charge in
the overseas operating companies, has resulted in the negative effective tax rate.
In accordance with UK legislation, the Group publishes an annual tax strategy, which is available on our website (www.sigplc.com).
Pensions
The Group operates a number of pension schemes, four of which provide defined benefits based upon pensionable salary.
One of these schemes, in the UK, has assets held in a separate trustee administered fund, and three are overseas book reserve
schemes. The largest defined benefit pension scheme is the UK scheme, which was closed to further accrual in 2016.
The Group’s total pension charge for the year, including amounts charged to interest after Other items, was £8.3m (2023:
£8.9m), of which a charge of £1.1m (2023: £1.4m) related to defined benefit pension schemes and £7.2m (2023: £7.5m) related
to defined contribution schemes.
The total net liability in relation to defined benefit pension schemes at 31 December 2024 was £18.2m (2023: £20.3m).
The latest triennial actuarial valuation of the UK scheme was as at 31 December 2022 and was concluded in March 2024.
The scheme remains well funded.
57
Strategic Report
Governance
Financials
SIG Annual Report and Accounts 2024
Financial review continued
Financial position
Overall, the net assets of the Group decreased by £48.7m to £179.8m (2023: £228.5m), with a cash position at year end
of £87.4m (2023: £132.2m) and net debt of £497.3m (2023: £458.0m), which includes net lease liabilities of £321.4m
(2023: £326.5m).
The movement in net debt mainly reflects the movement in cash noted below. A small constant currency increase in net lease
liabilities, more than offset by a favourable currency movement, resulted in net lease liabilities reducing by £5.1m.
Cash flow
2024
£m
2023
£m
Underlying operating profit
25.1
53.1
Add back: Depreciation
78.9
76.6
Add back: Amortisation
1.2
2.4
Underlying EBITDA
105.2
132.1
(Increase)/decrease in working capital
(6.6)
2.8
Repayment of lease liabilities
(67.5)
(63.6)
Capital expenditure
(16.1)
(15.8)
Other
2.2
3.8
Operating cash flow pre exceptional items1
17.2
59.3
Cash exceptional items
(13.0)
(6.4)
Operating cash flow1
4.2
52.9
Interest and financing
(34.8)
(34.7)
Tax
(8.0)
(14.0)
Free cash flow1
(38.6)
4.2
Acquisitions and investments
(8.4)
(0.7)
Drawdown/(repayment) of debt
7.3
(0.8)
Total cash flow
(39.7)
2.7
Cash and cash equivalents at beginning of the year2
132.2
130.1
Effect of foreign exchange rate changes
(5.1)
(0.6)
Cash and cash equivalents at end of the year2
87.4
132.2
1. Free cash flow is defined as all cash flows excluding M&A transactions, dividend payments, and financing transactions. Operating cash flow represents free cash flow
before interest and financing, and tax.
2. Cash and cash equivalents at 31 December 2024 comprise cash at bank and on hand of £87.4m (2023: £132.2m) less bank overdrafts of £nil (2023: £nil).
During the period, the Group delivered £17.2m of operating cash flow before exceptional cash spend, which represents a 68%
conversion of the underlying operating profit. Post exceptional cash the conversion was 18%. The lower profit in the year was
the key driver of lower year on year operating cash flow, coupled with slightly higher lease repayments and capex. Working
capital at the end of the year remained broadly in line with the previous year. The Group reported a free cash outflow of £38.6m
(2023: £4.2m inflow). This decline versus the prior year resulted from the lower operating cash flow.
Capex during the period was £16.1m (2023: £15.8m).
Cash exceptional items are those that are related to “Other items” in the Consolidated income statement, and include
restructuring costs and refinancing costs. “Other” in the cash flow includes payments to the Employee Benefit Trust to fund
share plans of £0.8m (2023: £1.7m), £2.5m payment to the defined benefit pension scheme in the UK, add back of non-cash
P&L items, provision movements, and proceeds on sale of property, plant and equipment.
Financing and funding
The Group’s debt funding comprises €300m of 9.75% and €13.5m of 5.25% fixed rate secured notes, maturing in October 2029
and November 2026 respectively, and an RCF of £90m which matures in April 2029. The 9.75% notes were issued in October
2024 through a refinancing of the Group’s previous bond and RCF, which were both due to mature in 2026. The new secured
notes are subject to incurrence-based covenants only. The RCF has a leverage maintenance covenant set at 6.5x for 2025, 5.5x
for 2026, and 5.0x thereafter, all of which only apply if the facility is over 40% drawn at a quarter end reporting date. The RCF
was undrawn throughout 2024, and remains undrawn at the date of this report.
58
SIG Annual Report and Accounts 2024
The Group’s liquidity position remained robust throughout 2024, and at the end of the period stood at £177m, consisting of cash
of £87m and the £90m undrawn RCF noted above.
2024
£m
2023
£m
Cash and cash equivalents at end of the year
87.4
132.2
Undrawn RCF at end of the year
90.0
90.0
Liquidity
177.4
222.2
Net debt
497.3
458.0
Leverage
4.7x
3.5x
Going concern
The Group closely monitors its funding position throughout the year, including monitoring compliance with covenants and
available facilities to ensure it has sufficient headroom to fund operations.
The Group’s financing facilities comprise €300m fixed rate secured notes, due October 2029, €13.5m fixed rate secured notes,
due November 2026, and a £90m Revolving Credit Facility (‘RCF’) that expires in April 2029. One of the trading businesses also
has a £1.3m bank loan repayable over the period to June 2026. The only financial covenant within these facilities is a leverage
maintenance covenant within the RCF, which is only tested if the facility is over 40% drawn (i.e. £36m) at a quarter end reporting
date. The covenant is set at 6.5x for 2025, 5.5x for 2026, and at 5.0x thereafter. The RCF was undrawn at 31 December 2024
and has remained undrawn subsequent to the year end.
The Group has significant available liquidity and on the basis of current forecasts is expected to remain in compliance with all
banking covenants throughout the forecast period to 31 March 2026 (‘the going concern period’).
The Directors have considered the Group’s forecasts which support the view that the Group will be able to continue to operate
within its banking facilities and comply with its banking covenants. The Directors have considered the following principal risks
and uncertainties that could potentially impact the Group’s ability to fund its future activities and adhere to its banking
covenants, including:
–prolonged challenging trading conditions in the Group's larger businesses, leading to lower volumes;
– pricing pressure on sales and modest net input cost deflation; and
– current economic and political uncertainties, potentially further impacting market demand.
The forecasts on which the going concern assessment is based have been subject to sensitivity analysis and stress testing to
assess the impact of the above risks and the Directors have also reviewed mitigating actions that could be taken. Following two
years of market-driven downturn, with a LFL revenue decline of 2% in FY23 and 4% in FY24, and continued market uncertainty,
a severe but plausible downside scenario has been modelled, which factors in a 2.5% reduction in revenue, a reduction in gross
margin and a resulting 32% reduction in underlying operating profit from the base forecast for the 12 months to 31 March 2026.
Certain mitigations are also included, for example delaying non-essential capital expenditure. Under this scenario the analysis
shows that sufficient cash would be available without triggering a covenant breach, as the RCF is not expected to be drawn
above the £36m at a relevant quarter end date, and furthermore the leverage covenant would also be below the required
threshold.
Reverse stress testing has also been performed, which shows that the Group could withstand up to an 11% reduction in
revenue from the base forecasts for the nine months to the forecast low liquidity point of 30 September 2025, or up to 13%
reduction for the 12 months to 31 March 2026, before triggering a covenant breach. Up to £90m RCF is available to meet
working capital requirements during the month, providing this is reduced to £36m before the quarter end date if the leverage
covenant is expected to be breached. Further cash phasing mitigations would also be available to avoid the requirement to
draw over £36m at a quarter end date if required.
The Directors have considered the impact of climate-related matters and this is not expected to have a significant impact on
the Group’s going concern assessment.
On consideration of the above, the Directors believe that the Group has adequate resources to continue in operational existence
for the forecast period to 31 March 2026 and the Directors therefore consider it appropriate to adopt the going concern basis in
preparing the 2024 Consolidated financial statements.
59
Strategic Report
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Financials
SIG Annual Report and Accounts 2024
Viability statement
In accordance with Provision 31 of
the Corporate Governance Code, the
Directors have undertaken an assessment
of the viability of the Group.
In making this assessment, the Directors
confirm that they have performed a
robust assessment of the principal risks
facing the Group, including those that
would threaten its business model,
future performance, solvency or liquidity.
Details of the risk identification and
management process as well as a
description of the principal risks and
uncertainties facing the Group are
included in this Strategic report on
pages 62 to 67. The Directors believe
the Group is well placed to manage
these risks successfully.
The Board has determined that a
three-year period to 31 December 2027
is the most appropriate period of
assessment.
Whilst the Board has no reason to
believe the Group will not remain viable
over a longer period, three years has
been chosen as this aligns with the
Group’s medium-term planning process
and is considered the period over which
it has reasonable visibility of the market
and industry characteristics to be able
to develop reasonable forecasting
assumptions and perform a realistic
viability assessment.
The assessment process and
key assumptions
In making the Viability statement,
the Directors are required to consider
the Group’s ability to meet its liabilities
as they fall due, taking into account
the Group’s current position and
principal risks.
The Group has a strong liquidity
position at 31 December 2024 despite
the weaker than expected trading
performance during the year and given
the availability of the £90m RCF. The
Group has committed facilities in place
until 2029, comprising €300m fixed
rate secured notes and the £90m RCF,
together with €13.5m secured notes
due November 2026.
The secured notes are subject to
incurrence-based covenants only, and
the RCF has a leverage maintenance
covenant set at 6.5x in 2025, 5.5x
in 2026 and 5.0x from 2027 onwards,
which only applies if the facility is over
40% drawn at a quarter end reporting
date. The RCF was undrawn throughout
2024 and remains undrawn at the date
of this report.
As part of the Group’s financial and
strategic planning process, the Group
has prepared financial forecasts for the
three years to 31 December 2027. The
process included a detailed review of
the forecasts, led by the Chief Executive
Officer and Chief Financial Officer, with
input from operational and functional
management, and these forecasts were
approved by the Board.
The resulting impact on key metrics was
considered with particular focus on
solvency measures including liquidity
headroom and financial covenants
where relevant.
Under each of the scenarios considered,
the forecasts indicate adequate
headroom during the three-year period.
Following two years of market-driven
downturn, with a LFL revenue decline
of 2% in 2023 and 4% in 2024, and
continued market uncertainty, a severe
but plausible downside scenario has
been modelled, which factors in a 2.5%
reduction in revenue and a reduction in
gross margin from the base forecasts
in each of the next three years and
a resulting reduction in underlying
operating profit from base forecasts
of 38% in 2025, 20% in 2026 and 14%
in 2027.
Certain mitigations are also included, for
example delaying non-essential capital
expenditure. Under this scenario the
analysis shows that sufficient cash
would be available without the need
to draw more than £36m on the
revolving credit facility at a relevant
quarter end, and therefore no covenant
tests would apply.
Reverse stress testing has also been
performed to analyse the level of
revenue, operating profit and cash
reductions over and above the scenario
considered above that could be
experienced before the RCF becomes
at least £36m drawn and there is
a potential breach in the leverage
covenant in the period under review.
In order to assess the resilience of the Group to threats posed by the principal
risks in severe but plausible scenarios, the Group’s financial forecasts were
subjected to thorough multi-variant stress and sensitivity analysis together with
an assessment of potential mitigating actions. This multi-variant stress and
sensitivity analysis included scenarios arising from combinations of the following:
Scenario
Link to principal risks
and uncertainties
The implications of a challenging economic
environment, in particular the potential impacts of
prolonged challenging trading conditions and weak
construction markets, have been modelled by
assuming a severe but plausible reduction in revenue
and gross margins in each of the next three years.
–Macroeconomic
uncertainty
–Change management
The impact of the competitive environment within
which the Group’s businesses operate and the
interaction with the Group’s gross margin have been
modelled by assuming a severe but plausible
reduction in revenue and gross margins during the
three-year period.
–Macroeconomic
uncertainty
–Change management
–Environmental, social
and governance
Financial review continued
60
SIG Annual Report and Accounts 2024
The analysis shows that the Group
could withstand a reduction in revenue
of between 11% and 13% in each of the
three years before triggering a covenant
breach if the RCF was 40% drawn at a
relevant quarter end. This is dependent
on the quarter end, with September
being the Group’s liquidity low point
based on phasing of purchases
and sales.
Up to £90m RCF is available to meet
working capital requirements during
the month, providing this is reduced
to £36m before a relevant quarter end
if the leverage covenant is expected
to be breached. Further cash phasing
mitigations would also be available to
avoid the requirement to draw over
£36m at a relevant quarter end if the
leverage covenant were expected to
be breached.
The Directors have considered the
potential impact of climate change
on the viability assessment.
At the current time, no legislation has
been passed that will impact the key
assumptions used in the forecasts and
there are no overriding changes to key
assumptions relating to climate change
built into the forecasts.
There is not considered to be a
significant risk of climate change
causing a significant downturn in
cash flows across the Group over
the viability assessment period and
therefore no specific sensitivities relating
to climate change are considered
necessary over and above the
scenarios considered above.
After conducting their viability review,
and taking into account the Group’s
current position and principal risks,
the Directors confirm that they have a
reasonable expectation that the Group
will be able to continue in operation
and meet its liabilities as they fall due
over the three-year period of their
assessment to 31 December 2027.
Cautionary statement
This Strategic report has been prepared
to provide the Company’s shareholders
with a fair review of the business of the
Group and a description of the principal
risks and uncertainties facing it. It may
not be relied upon by anyone, including
the Company’s shareholders, for any
other purpose.
This Strategic report and other sections
of this report contain forward-looking
statements that are subject to risk
factors including the economic and
business circumstances occurring from
time to time in countries and markets
in which the Group operates and risk
factors associated with the building
and construction sectors.
By their nature, forward-looking
statements involve a number of risks,
uncertainties and assumptions because
they relate to events and/or depend on
circumstances that may or may not
occur in the future and could cause
actual results and outcomes to differ
materially from those expressed in
or implied by the forward-looking
statements.
No assurance can be given that the
forward-looking statements in this
Strategic report will be realised.
Statements about the Directors’
expectations, beliefs, hopes, plans,
intentions and strategies are inherently
subject to change and they are based
on expectations and assumptions as to
future events, circumstances and other
factors which are in some cases outside
the Group’s control. Actual results could
differ materially from the Group’s current
expectations.
It is believed that the expectations set
out in these forward-looking statements
are reasonable but they may be affected
by a wide range of variables, which
could cause actual results or trends to
differ materially, including but not limited
to, changes in risks associated with the
level of market demand, fluctuations in
product pricing and changes in foreign
exchange and interest rates.
The forward-looking statements should
be read in particular in the context of
the specific risk factors for the Group
identified on pages 62 to 67 of this
Strategic report.
The Company’s shareholders are
cautioned not to place undue reliance
on the forward-looking statements. This
Strategic report has not been audited
or otherwise independently verified.
The information contained in this
Strategic report has been prepared
on the basis of the knowledge and
information available to Directors at the
date of its preparation and the Company
does not undertake any obligation to
update or revise this Strategic report
during the financial year ahead.
The Strategic report (comprising up to
and including page 67) was approved by
the Board of Directors on 4 March 2025
and signed on the Board’s behalf by:
Gavin Slark
Director
Ian Ashton
Director
4 March 2025
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Risks and risk management
Risk management plays an integral part in SIG’s planning,
decision-making and management processes.
Our approach to
risk management
All employees have a responsibility to
ensure they understand their relevant
risks, that appropriate controls are in
place and that they are operating
effectively to manage these risks. The
Board maintains overall responsibility for
ensuring risk management and internal
control systems are robust.
The Board, supported by the Audit &
Risk Committee, sets the strategy for
the Group and ensures risks are
effectively identified and managed
through the implementation of the risk
management and control frameworks.
The Group employs a three lines model
to provide a simple and effective way to
enhance risk and control management
processes and ensure roles and
responsibilities are clear. The Board
maintains oversight to ensure risk
management and control activities
carried out by the three lines are
proportionate to the perceived degree
of risk and its own risk appetite across
the Group. An outline of the three
lines model is detailed below.
Our approach to risk
management
The ability to effectively manage risks
and uncertainties is at the heart of every
successful organisation and how we
identify and respond to risks and
uncertainty will influence business
outcomes and contribute to the quality
of our decisions.
To identify our risks, we focus on our
strategic objectives and consider what
might stop us achieving our plan within
our strategic planning period. The
approach combines a top-down
strategic Group-level view and a
bottom-up operational view of the risks
at operating company level. Meetings
are held with our operating company
leadership teams to identify the risks
within their operations.
These are consolidated and, in
conjunction with a series of discussions
held with the Executive Leadership
Team and Non-Executive Directors,
provide the inputs to identify and
validate our principal risks.
To assess our risks, we consider the
likely financial, reputational, regulatory,
and operational impacts and the
probability that each risk may materialise.
This helps us to assess the nature and
extent of internal control we need
to implement to manage the risk
to an acceptable level. For each of the
principal risks, we have considered
whether the risk is increasing, decreasing
or remains unchanged. We have also
given an indication of those elements
of our strategic plan which may be
impacted should any of the risks
materialise.
To ensure we effectively monitor our
risks, the principal risks are reviewed by
the Board, the Audit & Risk Committee
and the Executive Leadership Team
regularly during the year. Changes to the
principal risks and mitigation activities
are considered as part of this review.
Risk appetite
The Board recognises that, in order to
achieve its strategic objectives, it must
accept and manage a certain degree
of risk. On at least an annual basis it
considers the nature and level of risk
it is prepared to accept to deliver
the strategy.
Risk appetite is assessed against a
suite of risk categories directly relevant
to the Group, supported by high-level
statements which set out the Board’s
expectations with regards to the
accepted level of risk appetite for
each category of risk.
We continue to have a higher appetite
for those risks that present the greatest
opportunities for commercial reward
and take a balanced approach to such
opportunities in terms of assessing
potentially higher levels of risk
and return.
We do, however, have a very low
tolerance for risks that have significant
negative consequences, particularly
when they could adversely impact
health and safety, legal compliance,
our values and culture, or our reputation.
We aim to either avoid those activities
that may result in these risks
materialising or eliminate these
risks with our mitigation efforts.
Principal risks
The Board regularly monitors the Group
risk register, which includes the ten
principal risks to the Group set out
in this report. These risks, if they
materialise, could have a significant
impact on the Group’s ability to meet its
strategic objectives. The assessed net
risk scores (likelihood and impact of the
risk occurring after taking account of
mitigating controls) are outlined in the
following matrix and details of the risks
and current mitigations are included in
the table on the following pages.
Our strategic pillars
As set out on page 11, our strategic
framework focusses on three long-term
objectives, and four actions over the
medium-term to improve our operating
performance. The risk matrix that
follows also identifies how each risk
relates to each of our three long-term
strategic objectives:
–Partner of choice for specialist
contractors
–Improve our operating performance
–Growing sustainably as a responsible
business
62
SIG Annual Report and Accounts 2024
Risk management principles
Our approach to risk management is supported by the following key risk management principles:
The three lines model
Operational management:
Operational management is responsible
for identifying and assessing risks on an
ongoing basis, and for implementing
and maintaining appropriate controls
aligned to the organisation’s policies
and procedures.
Risk management, internal
controls and compliance
functions:
Our compliance, risk management
and internal controls functions support
the business in ensuring effective
implementation of, and compliance
with, policies and procedures across
the business.
Independent assurance:
Our internal audit function provides
independent assurance to ensure
that controls are implemented and
are operating efficiently and effectively
across the organisation.
First
line
Second
line
Third
line
1. Role of the Board:
The Board is responsible for ensuring
there are adequate procedures to
manage risk, overseeing the internal
control framework, and determining
the nature and extent of the principal
risks the Group is willing to take in
order to achieve its long-term strategic
objectives. The Audit & Risk Committee
has responsibility for reviewing the
overall risk management policy and
ensuring its effective implementation.
2. Responsibility and
accountability:
A fundamental premise of our approach
is that each operating company owns its
risks and works in collaboration with the
Group Risk and Internal Audit function
to ensure it performs regular risk
identification, assessment, mitigation,
monitoring and reporting processes.
3. Transparency and openness:
Risk management activities and
processes are subject to regular
review in order to provide reasonable
assurance of the effectiveness of local
risk management arrangements and
to consider the status of mitigations
or additional controls required.
4. Culture of continuous
improvement:
We are committed to ensuring that we
regularly review our risk management
processes and ensure that they remain
relevant and support our businesses in
making risk informed decisions.
5. Applicability:
Our approach to risk management
is applicable to all entities across
the Group. Risks incurred through
contractual relationships that directly
impact the Group’s risk profile are
monitored, as determined by the Board.
Possible
Moderate
Impact
Likelihood
Likely
Critical
Principal risks
10
1
9
6
7
8
4
5
2
3
1 Cyber security
2 Health and safety
3 Macroeconomic uncertainty
4 Attract, recruit and retain
our people
5 Data quality and governance
6 Environmental, social and
governance (ESG)
7 Mergers and acquisitions
8 Legal or regulatory compliance
9 Modernisation
10 Change management
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Risks and risk management continued
Principal risks and uncertainties
Risk
Description
Mitigation
1. Cyber security
Internal or external cyber-
attacks could result in system
disruption or sensitive data
being compromised
In the context of widespread dependency
on increasingly complex digital systems,
growing cyber threats are outpacing
societies’ ability to effectively prevent
and manage them. These risks are also
exacerbated by a combination of the
increasing interconnectedness and
interdependencies of our technology
platforms and ecosystems, as illustrated
by the widespread business disruption
caused by the 'Crowdstrike' IT outage in
the summer of 2024, the increasing
willingness of nation states to engage in
asymmetric cyber warfare to achieve
geopolitical aims and the relative ease with
which new artificial intelligence (AI) and
machine learning (ML) technologies can
be utilised for adversarial purposes.
For example Generative AI is making
cyberattacks more sophisticated through
more believable social engineering,
automated phishing attacks and
adaptive malware.
There is a risk that we lack the capabilities
to effectively prevent, monitor, respond to,
or recover from, suspected cyber-attacks
on our IT infrastructure. Such attacks may
result in a loss of data or disruption to IT
services which may have a significant
impact on our ability to operate and
comply with data protection and privacy
laws (e.g. GDPR) and may have a
detrimental effect on our reputation.
Cyber security continues to receive Board and
Executive Leadership Team focus with an emphasis
on ensuring that appropriate technologies are
deployed across IT infrastructure to manage
cyber threats.
Regular and independent reviews are performed to
assess the nature of potential cyber threats, security
processes and initiatives. They also ensure that we
implement appropriate tools and processes to better
identify and remediate new and emerging cyber risks
and vulnerabilities.
Cyber-incident response protocols are in place to
support our ability to effectively respond to and
recover from a cyber threat or incident and ongoing
cyber training campaigns and initiatives ensure
employees are alert to the nature and consequences
of cyber-attacks.
Cyber policies are regularly reviewed and updated
to ensure they reflect the nature of risks and threats
and we continue to invest in our business resilience
and continuity management capabilities and
arrangements.
Risk movement:
Link to strategic objectives:
2. Health and safety
Danger of incident or accident,
resulting in injury or loss of life
to employees, customers, or
the general public
There is a risk that poor organisational
arrangements or behavioural culture with
regards to health and safety causes
harm to individuals and may result in
enforcement action, penalties, reputational
damage, or adverse press coverage.
The Group Health, Safety and Environment Director
is a member of the Executive Leadership Team and
provides strategic leadership for all health, safety and
environmental matters. Local health and safety
managers in each of our businesses provide local
leadership and support, monitor and report our
performance and key metrics, and implement
actions and initiatives.
A compliance standards framework is in place
to ensure the adequacy of local health and safety
standards and arrangements, with assurance
provided through a programme of compliance
audits performed by suitably trained and experienced
health and safety professionals.
Risk movement:
Link to strategic objectives:
64
SIG Annual Report and Accounts 2024
Risk movement
increased
unchanged
decreased
Our long-term strategic objectives
Partner of choice
for specialist
contractors
Improving
our operating
performance
Growing sustainably
as a responsible
business
Risk
Description
Mitigation
3. Macroeconomic uncertainty
Macroeconomic volatility may
impact the Group’s ability to
accurately forecast and to
meet internal and external
expectations
Geo-political and macroeconomic events
can lead to a decline in general economic
activity and, or including, a decline in
construction industry activity.
While there are some indicators of a
modest fiscal recovery in 2025, market
conditions are set to remain challenging,
particularly in France and Germany, which
may continue to see political instability in
2025. This is in addition to the existing and
ongoing turbulence and volatility caused
by conflicts in other regions, such as Ukraine.
Inflation remains uncertain and its effect
on monetary policy, higher interest rates
and the costs of living will remain a cause
of uncertainty and possible volatility for the
immediate future across our end-markets.
This volatility has the potential to impact
customer demand, and create financial
and operational pressure, while adding
costs to our operations and making
planning and forecasting more difficult.
The Group’s geographical diversity across Europe,
serving customers across residential, commercial,
industrial and infrastructural sectors, combined with
our broad portfolio of categories, product offerings
and specialisms, all serve to reduce the impact of
changes in a specific territory or market.
Industry-based KPIs, monitored monthly at a Group and
operating company level, help to ensure that warnings
and indicators of risks and opportunities are identified
early, and appropriate mitigation strategies implemented.
We continue to assess inflationary and other fiscal
pressures and impacts on product pricing and will
continue to work with our suppliers to identify
opportunities to ensure ongoing supply chain resilience.
Risk movement:
Link to strategic objectives:
4. Attract, recruit and retain our people
Failure to attract and retain
people with the right skills,
drive and capability to reshape
and grow the business
SIG’s ability to deliver its objectives and
to compete effectively is, in part,
dependent on its ability to recruit and
retain colleagues with the necessary
skills, experience and ability to deliver
expected performance levels.
A combination of medium-term structural
labour and vocational skills shortages in
the construction sector, exacerbated by
near term employee concerns regarding
the performance and stability of the
construction sector, has the potential to
negatively impact SIG’s ability to attract,
recruit and retain staff across the full
spectrum of disciplines.
We continue to invest in learning and development
programmes to ensure both vocational and technical
training needs are met whilst retaining an agile
workforce. Our apprenticeships and training
academies help develop the near and long-term
skills of our employees.
We regularly review our organisational structures and
accountabilities, and ensure our structures optimise
employee motivation and engagement. Employee
engagement is monitored through an annual survey and
a Workforce Engagement programme run by the Board.
Ongoing enhancements to pay and conditions, including
market benchmarking, broadening variable remuneration
elements and retention and succession planning also
help to mitigate this risk.
Our businesses have also introduced programmes to
support employee health and wellbeing. This includes
training for all employees on keeping themselves and
their colleagues safe and well.
Risk movement:
Link to strategic objectives:
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SIG Annual Report and Accounts 2024
Risk
Description
Mitigation
5. Data quality and governance
Poor data quality could impact
our financial management,
fact-based decision-making,
business efficiency, and
credibility with customers
There is a risk that we lack the necessary
quality of systems and processes to
ensure sufficient granularity, completeness,
and accuracy of vendor, product and
pricing master data. This has the potential
to impact our ability to deliver a digital
customer experience, provide enhanced
product and customer analytics or insight
and comply with both existing and new
regulatory requirements.
Product and customer data quality remains a focus area
for our operating companies, who continue to monitor,
assess and upgrade their product data requirements,
capabilities and governance, considering ongoing
changes in business needs and regulation. During 2024,
we continued to enhance our data management
and governance capabilities though the ongoing
development of new product information systems across
our UK and French businesses. We also continue to
maintain and, where necessary, upgrade our ERP
systems where relevant to ensure these systems support
the required data quality and governance required.
Risk movement:
Link to strategic objectives:
6. Environmental, social and governance (ESG)
Reputational impacts from
poor environmental, social
and governance arrangements
and performance
Public and commercial consciousness,
driven in part by ongoing regulatory
pressures, continues to evolve on a
wide range of environmental, social and
governance issues, including climate
change, employee wellbeing and how
an organisation contributes to society.
While SIG has a long and rich heritage in
helping the construction industry deliver
energy efficient solutions and products,
risks remain in terms of how we deliver
our ESG agenda.
This is particularly the case in how
we ensure we achieve our stated aims
with regards to climate change and
decarbonisation. These risks include
the cost and complexity of compliance,
the challenges presented by the
decarbonisation of our vehicle fleet
and estate and how we engage with the
wider industry to reduce product and
supply-chain carbon impacts.
As outlined on page 27, our ESG commitments include a
focus on health and safety leadership, reaching net zero
carbon, sending zero SIG waste to landfill, partnering to
reduce carbon and waste across the supply chain, and
becoming an employer of choice in our industry.
These commitments will be supported by verified data
to ensure that progress in achieving these aims and
ambitions is monitored and subject to appropriate rigour.
To do this, we have enhanced our sustainability reporting
and budgeting processes (particularly in relation to
carbon emissions and waste) to ensure that we are
able to effectively track both the progress and financial
impacts of commitments.
We have also ensured we are able to monitor new an
emerging ESG legislation and implement the appropriate
management arrangements, systems and processes,
particularly with regards to the ensuring compliance with
new legislation implemented in the EU, including the
Corporate Sustainability Reporting Directive (CSRD) and
the Corporate Sustainability Due Diligence Directive
(CSDDD).
As regards employee wellbeing, each of our businesses
has introduced programmes and initiatives to support
employees, underpinned by a Group-wide employee
health and wellbeing policy and training for all employees
to understand their responsibilities to keep themselves
and their colleagues safe and well.
Risk movement:
Link to strategic objectives:
7. Mergers and acquisitions
Inability to successfully
execute, integrate and leverage
merger and acquisition
opportunities
Where necessary, we may from time to
time acquire new businesses. Such
decisions are based on detailed plans that
assess the value creation opportunity for
the Group. By their nature, there is an
inherent risk that we fail to manage the
execution and integration risks which may
result in delays or additional costs and
impact the future value and revenues
generated.
We have appropriate M&A resource across the
organisation, and also utilise external advisors where
necessary for the effective identification and prioritisation
of acquisition opportunities.
Resource is also available in the organisation to ensure
that transactions are subject to the necessary pre and
post-acquisition and integration activities and processes.
Clear accountability and authority limits for the initiation
and approval of M&A activity are defined in the Group
Delegation of Authority.
Risk movement:
Link to strategic objectives:
Principal risks and uncertainties continued
Risks and risk management continued
66
SIG Annual Report and Accounts 2024
Risk
Description
Mitigation
8. Legal or regulatory compliance
Failing to comply with, or
breaching, legal or regulatory
requirements
The Group’s operations are subject to an
increasing and evolving range of regulatory
and other requirements in the markets in
which it operates. A major corporate failure
resulting from a non-compliance with
legislative, regulatory or other requirements
would impact our brand and reputation,
could expose us to significant operational
disruption or result in enforcement action
or penalties.
Our Group General Counsel is a member of the
Executive Leadership Team and is supported by
appropriately skilled in-house legal and company
secretarial resource at Group and operating
company level, with further support provided by an
approved panel of external lawyers and advisors.
Policies and procedures are in place to ensure
compliance with legal and regulatory frameworks,
including health and safety, environmental, ethical,
fraud, data protection and product safety.
The Group’s internal controls function ensures that
appropriate and effective controls are in place against
material financial misstatement, errors, omissions
or fraud.
Our Code of Conduct is available on our website and
forms part of our employee induction programme.
E-learning tools are also deployed across the
organisation to ensure employees are aware of,
and understand, their obligations.
A whistleblowing hotline, managed and facilitated by
an independent third party, is in place throughout the
Group. All calls are followed up and investigated fully
with all findings reported to the Board.
Risk movement:
Link to strategic objectives:
9. Modernisation
Failure to deliver the digital
capabilities necessary to
support improved efficiency
and productivity or to remain
competitive in the marketplace
Increased technological innovation and
change has accelerated the increasing role
digitalisation will have in the construction
materials supply chain. We continue to
seek opportunities to ensure we can
deliver digital solutions to enable a more
efficient, integrated, and frictionless
experience for our colleagues, customers
and suppliers.
This risk may be exacerbated by legacy
systems and technologies which are
heavily customised, require significant
system maintenance to prevent outages
and lack the functionality to allow their
integration into a more modern digital
infrastructure.
We continue to evaluate new technologies and make
investments in the digital workplace to ensure that we
maintain a competitive digital proposition.
Across our markets each operating company is
responsible for ensuring that it has an appropriate
technology roadmap to identify how it implements
the necessary technologies and ways of working to
ensure that it can maximise digital opportunities in
terms of enhancing the customer experience and
optimising transactional, fulfilment or process
efficiencies.
During 2024 we have invested in a new ERP system
for our Polish business.
Risk movement:
Link to strategic objectives:
10. Change management
Inability to change and grow
the organisation as planned in
order to meet growth targets
The Group is committed to improving its
operating performance with a strategy, key
actions and progress on these as set out
on pages 20 to 23.
This will inevitably require changes to
organisational structures, roles, and ways
of working, supported by investments to
modernise existing and implement new
IT systems.
There is a risk that these initiatives, allied
to the impacts of challenging market
conditions for our business and employees,
results in ‘change fatigue’ and either future
changes are not implemented as planned,
or the benefits are not realised.
Operating companies continue to manage change
portfolios through programme management
governance committees. Increased monitoring has
been implemented, particularly regarding progress
against growth initiatives, in line with our strategy.
Monitoring of business growth metrics and early
warning indicators or trends continues as part of
business reviews at both the management and
Board level.
Our ongoing employee engagement surveys
continue to facilitate the early identification of change
impact in terms of our employees, and action plans
are implemented and monitored accordingly.
Risk movement:
Link to strategic objectives:
Our long-term strategic objectives
Partner of choice
for specialist
contractors
Improving
our operating
performance
Growing sustainably
as a responsible
business
Risk movement
increased
unchanged
decreased
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Corporate governance report
Chairman’s
introduction
to Governance
We continue to uphold high
standards of corporate
governance, while navigating
challenging market conditions.
Andrew Allner
Chairman
Dear Shareholder,
On behalf of the Board, I am pleased
to present the Group’s Corporate
Governance report for the financial
year ended 31 December 2024.
As outlined in my Chairman’s statement
on pages 8 to 10, the Group experienced
challenging trading conditions during the
year, and the financial results reflected
this. However, the Group continues to
make good progress on its operational
initiatives and the Board remains
confident that the Group remains well
positioned to benefit from the market
recovery when it occurs, and in turn to
improve its operating margin and cash
generation. On behalf of the Board,
I would like to thank all of our employees
for their hard work, commitment and
achievements during the year.
Board focus in 2024
The Board’s focus during the year
has been on continuing to ensure
that the Group is set up for long-term
sustainable success. The Board
spent significant time considering and
approving the refinancing of the Group’s
existing bond and issuance of a new
bond. In addition, the Board spent time
considering market developments and
mitigating actions, technology issues
and modernisation, health and safety,
sustainability, M&A and financial, legal
and compliance matters material to the
Group. Further information on the Board
activities during the year can be found
on page 72.
Board composition and
succession planning
As at 31 December 2024, the Board
comprised of eight Non-Executive
Directors and two Executive Directors.
No changes to the composition of the
Board were made during the year.
The Board is now looking ahead to
succession planning for the next
few years and continues to prioritise
succession planning for the Executive
Leadership Team (“ELT”) and other
senior leaders in the Group. The
biographies of the Board, as of the date
of this report, are listed on pages 70 and
71. Appointments of new Directors are
made by the Board on recommendation
of the Nominations Committee.
The Nominations Committee’s
responsibilities and a description of its
work can be found in the Nominations
Committee report on pages 84 to 87.
68
SIG Annual Report and Accounts 2024
Board performance review
This year the Board undertook an
annual internal review of its own and
its Committees’ performance and
effectiveness. Our last external
evaluation was carried out during the
year ended 31 December 2021. As the
company was not, during the year, nor
is it currently, part of the FTSE 350 the
Board decided to defer an external
evaluation to a later year. This was
considered to be a proportionate
approach in light of prevailing market
conditions and the need to focus on
short-term financial performance.
I am pleased to report that the 2024
Board performance review concluded
that the Board, its Committees and
individual Directors were performing
effectively. Further details of the Board
performance review, together with
progress against the outcomes from
the 2023 Board performance review,
can be found on page 83.
CD&R
CD&R holds c.29% of the shares in SIG,
a stake that it took up in 2020 largely as
part of the equity fundraising. CD&R has
two Directors appointed to the Board,
currently being Bruno Deschamps
and Diego Straziota. CD&R has the
right to appoint one member to the
Remuneration Committee and
Nominations Committee (currently
Bruno Deschamps) and to appoint an
observer to the Audit & Risk Committee
(currently Diego Straziota). Further
details of the relationship with CD&R
can be found on page 78.
The recent Board performance review
demonstrated that the other Directors
recognise and value the contribution
made to the Group by Bruno and Diego;
and that their contributions are not
limited to representing the interests of
CD&R’s funds which are invested in SIG.
They each bring a wealth of sector
experience and wider knowledge that
enhances the discussions at Board
meetings and contributes to the making
of better decisions.
Diversity and inclusion
The Board comprises ten Directors of
whom two are women, with one-third
of the independent Non-Executive
Directors being women. The Board
includes one Director from an ethnic
minority background. The Board is
aware of the importance of making
progress on diversity in general. The
Board has met two of the three diversity
targets set by the UK Listing Rules, with
one of the senior Board positions being
held by a woman and one Board
member being from an ethnic minority
background. The Board aspires to
achieve the target of 40% of members
being women and continues to monitor
progress in this area. Further details on
diversity and inclusion can be found in
the Nominations Committee report on
page 86.
Sustainability commitments
Progress we have made towards fulfilling
our sustainability commitments is
contained in the Strategic report set out
at pages 26 to 51. The Board received
regular updates on progress against
these commitments during the year.
Annual General Meeting
The AGM will be held on 1 May 2025 at
SIG West London, Mathisen Way, Poyle,
Slough, SL3 0HB. If you are unable
to attend in person and you have
any questions, please email them to
cosec@sigplc.com in advance of the
meeting. We will ensure the answers
to your questions are provided at
the meeting. Further details of the
arrangements for the AGM will be
sent to shareholders shortly. I warmly
extend the invitation to all shareholders
to join us in person at the AGM.
Andrew Allner
Chairman
4 March 2025
Compliance with the UK Corporate
Governance Code 2018
Our Governance sections, set out over the following pages,
explain how the Group has applied the principles and
complied with the provisions of the Code1 during the financial
year ended 31 December 2024. In 2024, we were fully
compliant with the Code with the exception of Provision 32,
which requires the Board to establish a Remuneration
Committee of independent non-executive directors. Bruno
Deschamps was a member of the Remuneration Committee
and, as a nominated Director of CD&R, he was not considered
to be independent under Provision 10. The Board’s opinion
is that Bruno’s contribution to the Remuneration Committee
benefits the Committee and shareholders as a whole and
that, were Bruno not a member of the Committee, the Board
would need to consider how to replace the contribution that
he makes.
The Board has noted the publication of the Financial
Reporting Council’s revised UK Corporate Governance Code
2024 which will apply to financial years beginning on or after
1 January 2025, with the exception of Provision 29 which
will apply to financial years beginning on or after 1 January
2026. The Board has reviewed the recommended changes
to governance arrangements and will report appropriately in
next year’s annual report.
1 Board leadership and Company purpose
70
2 Division of responsibilities
78
3 Composition, succession and evaluation
Nominations Committee report
83
84
4 Audit, risk and internal control
Audit & Risk Committee report
Risk management and internal control
88
96
5 Remuneration
Directors’ remuneration report
98
1. The UK Corporate Governance Code 2018 (the ‘Code’) can be accessed at
www.frc.org.uk.
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Financials
SIG Annual Report and Accounts 2024
Corporate governance report continued
Board of Directors
R
N
1
2
3
4
5
Board leadership and
Company purpose
Andrew Allner
Non-Executive
Chairman1
Gavin Slark
Chief Executive Officer
Ian Ashton
Chief Financial Officer
Kath Durrant
Senior Independent
Director
Alan Lovell
Non-Executive Director
Appointed as
Non-Executive Chairman
on 1 November 2017.
Appointed as an Executive
Director and Chief Executive
Officer on 1 February 2023.
Appointed as an Executive
Director and Chief Financial
Officer on 1 July 2020.
Appointed as an
Independent Non-Executive
Director and Remuneration
Committee Chair on
1 January 2021. Appointed
as Senior Independent
Director in September 2023.
Appointed as an
Independent Non-Executive
Director on 1 August 2018.
Career and experience
Andrew brings extensive
experience serving on the
boards of publicly listed
companies as Chairman
and as a Non-Executive
Director. He was previously
Chairman at Shepherd
Building Group Limited,
Eco Buildings Group plc,
The Go-Ahead Group plc
and Marshalls plc, and a
Non-Executive Director at
Northgate plc, AZ Electronic
Materials SA and CSR plc.
Andrew has held executive
roles as Group Finance
Director of RHM plc and
CEO of Enodis plc. He has
also held senior executive
positions at Dalgety plc,
Amersham International plc
and Guinness plc. He has
significant experience in
managing and navigating
challenging situations.
Career and experience
Gavin was previously
Chief Executive Officer
at Grafton Group plc, an
international distributor
of building materials and
DIY retailer, for 11 years
from 2011. Prior to that he
held the position of Group
CEO at BSS Group plc, a
prominent UK distributor for
specialised trades including
the plumbing, heating, and
construction sectors. Gavin
has extensive leadership
experience in the pan-
European construction
distribution sector and
a proven track record of
driving shareholder value in
publicly listed companies.
Career and experience
Prior to joining SIG, Ian
served as Chief Financial
Officer at Low & Bonar plc
until its acquisition by the
Freudenberg group. Before
that, he was Chief Financial
Officer of Labviva LLC,
a US-based technology
company. Ian spent a
significant portion of his
career at Smith & Nephew
plc, where he held various
senior finance positions
in the UK, USA, and Asia.
Ian is a qualified chartered
accountant and began his
career at Ernst & Young LLP.
Ian brings extensive UK and
international financial and
accounting expertise to the
Board and to his role as
Chief Financial Officer.
Career and experience
Kath has held senior roles
at GlaxoSmithKline plc and
AstraZeneca plc. She was
formerly Group Human
Resources Director at Rolls
Royce plc and Ferguson plc
and served as Chief Human
Resources Officer of CRH
plc. She has served as a
Non-Executive Director and
Chair of the Remuneration
Committee of Vesuvius plc,
Renishaw plc and Calisen
plc. Kath brings substantial
leadership experience
across a range of businesses
and has a strong track
record of chairing the
remuneration committees of
publicly listed companies.
Career and experience
Alan brings extensive
leadership experience to
the Board, having served as
Chief Executive Officer at six
companies, including Jarvis
plc and Costain Group plc.
He has also been Chair of
several listed companies,
including Interserve Group
Limited, Progressive Energy
Ltd and the Consumer
Council for Water.
Key strengths
Substantial board,
leadership, strategy,
international and general
management, corporate
transaction, governance and
accounting expertise.
Key strengths
Significant in-depth
knowledge and years of
experience in the distribution
sector, shaping strategy
and culture, product
knowledge, leadership and
management.
Key strengths
Broad global experience in a
series of financial leadership
roles. A strong track record
in corporate transactions,
driving change, accounting/
finance and stakeholder
engagement with significant
international experience.
Key strengths
Strong leadership
and human resources
experience across a
range of businesses,
transformation and change
management, construction
industry and international
experience.
Key strengths
Significant listed company
board experience.
Accounting and finance,
corporate transactions
and extensive construction
industry and turnaround
experience in the UK
and Europe.
Key external
appointments
None
Key external
appointments
None
Key external
appointments
None
Key external
appointments
Non-Executive Director and
Remuneration Committee
Chair at Essentra plc
and Anglian Water
Services Limited.
Key external
appointments
Chair of the
Environment Agency.
A
R
N
I
A
R
N
I
1. Independent on appointment.
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SIG Annual Report and Accounts 2024
Committee key
A Audit & Risk Committee
R Remuneration Committee
N Nominations Committee
Chair of Committee
I Independent Director
Bruno Deschamps
Non-Executive Director
Shatish Dasani
Non-Executive Director
Gillian Kent
Non-Executive Director
Simon King
Non-Executive Director
Diego Straziota
Non-Executive Director
Appointed as a
Non-Executive Director
on 10 July 2020.
Appointed as an
Independent Non-Executive
Director and Chair of the
Audit & Risk Committee on
1 February 2021.
Appointed as an
Independent Non-Executive
Director on 1 July 2019.
Appointed as an
Independent Non-Executive
Director on 1 July 2020.
Simon is the Designated
Non-Executive Director for
Workforce Engagement.
Appointed as a
Non-Executive Director
on 4 May 2023.
Career and experience
Bruno is an Operating
Advisor to CD&R LLP and
the Chairman and CEO of
Entrepreneurs Partners LLP.
He is a former Chairman of
Diversey (USA) and Kloeckner
Pentaplast (Germany). He has
served as Managing Partner
of 3i Plc Group, Operating
Partner of CD&R where he
played a pivotal role in the
firm’s investments in Brakes,
as Chairman, and CEO in
Culligan, Rexel and VWR.
Bruno was president and
COO of Ecolab Inc (USA), and
President and CEO of Henkel
Ecolab, Teroson GmbH, VP
Henkel Industrial Adhesives
(Germany), and Chairman
and CEO of SAIM (France).
Bruno is a Knight of the
Legion d’Honneur (France).
Career and experience
Shatish has over 30 years’
experience in senior
public company finance
roles across various
sectors, including building
materials, advanced
electronics, engineering,
general industrial, business
services, construction,
and infrastructure. He also
has extensive international
experience including as
a regional CFO in South
America. He was previously
Chief Financial Officer
of Forterra plc and
TT Electronics plc and has
served as an alternative
Non-Executive Director for
Camelot Group plc and as a
Public Member at Network
Rail plc.
Career and experience
Gillian has had an extensive
career in software,
internet, digital media
and mobile technology
businesses and formerly
had a broad executive
career including being
Chief Executive of real
estate Propertyfinder.com
until its acquisition by
Zoopla, and 15 years with
Microsoft, including three
years as Managing Director
of MSN UK. Gillian was
previously a Non-Executive
Director of NAHL Group plc,
Pendragon PLC and Dignity
plc. Gillian brings a wealth of
knowledge to the Board in
customer, digital, brand,
and marketing.
Career and experience
Simon most recently
served as a Non-Executive
Director for Headlam
Group plc. Simon has
extensive experience in the
construction sector having
served on the Travis Perkins
Executive Board and as
CEO of Wickes. Previously,
he worked at Walmart as
Chief Operating Officer of
Asda and served as CEO
at Savola Group Middle
East. Simon has held CEO
positions for Tesco in Turkey
and South Korea, where he
led the joint venture with
Samsung. Before his role at
Tesco South Korea, Simon
served as Chief Commercial
Officer for Tesco in central
Europe.
Career and experience
Diego is a Managing
Director at CD&R LLP and
holds a directorship in
Wolseley, a CD&R portfolio
company. Since joining
CD&R in 2017 Diego has
been played an instrumental
role in CD&R’s investments
in Opella, UDG and the
subsequent separation of
UDG from Inizio and Sharp,
Westbury Street Holdings
and Wolseley. Diego is
responsible for investment
activities in European
Industrials at CD&R. Prior to
joining CD&R, he worked in
the private equity division of
Blackstone.
Key strengths
Deep industrial knowledge,
corporate transactions,
and extensive experience
in driving and overseeing
improved company
performance.
Key strengths
Strategy development and
execution, performance
improvement, financial
management, corporate
finance, and mergers
and acquisitions. Sector
experience of building
materials, advanced
electronics, general
industrial, business
services and infrastructure.
Key strengths
Strong commercial
acumen, strategic, change
management, stakeholder
engagement, customer
and digital/technology
experience, brand and
marketing across a broad
range of businesses.
Key strengths
Over 35 years’ experience
leading international
teams, building products
distribution experience,
change management, retail
and distribution, marketing,
technology/digital and
stakeholder engagement
experience, particularly
in the workforce.
Key strengths
Diego possesses a wealth of
sector-specific knowledge
and has a track record in
strategy development and
corporate transactions.
His expertise extends to
driving and overseeing
improvements in company
performance.
Key external
appointments
Directorships in the following
CD&R portfolio companies:
Kalle GmbH, OCS Group
and Wolseley, of which he is
also Chairman.
Key external
appointments
Senior Independent Director
and Audit & Risk Committee
Chair of Renew Holdings
plc. Non-Executive Director
and Audit & Risk Committee
Chair at Speedy Hire plc and
Genuit Group plc. Trustee
and Chair of UNICEF UK.
Key external
appointments
Non-Executive Director and
Remuneration Committee
Chair at Mothercare plc and
Marlowe plc. Non-Executive
Director and Chair of Risk at
THG plc.
Key external
appointments
Non-Executive Chairman
at Troy (UK) Limited. Non-
Executive Director at James
Donaldson Group Ltd and
Chairman at Smoking
Lobster Restaurants
(Isle of Wight).
Key external
appointments
Holds a Directorship in
Wolseley, a CD&R
portfolio company.
R
N
A
R
N
I
A
R
N
I
A
R
N
I
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Financials
SIG Annual Report and Accounts 2024
Corporate governance report continued
Board activities in 2024
1
2
3
4
5
Board leadership and
Company purpose
Strategy and financing
–Regular updates and reviews
throughout the year to monitor the
Group’s financing position, medium-
term plan and business plan.
–Approval of the debt refinancing
and the successful offering of the
Company’s bond, listed on the
International Stock Exchange.
–Consideration and oversight of
potential M&A opportunities to ensure
they advance the Group’s strategy
and are earnings enhancing.
–Regular business reviews of each
of the operating companies.
–Received regular updates on the
measures being taken to mitigate any
increase in bad credit risk as a result
of trading conditions.
–Received specific feedback from
advisors during the refinancing
process on debt investor sentiment.
–Reviewed and approved the Group’s
Treasury policies.
Communities
and Environment
Stakeholder groups
Link to strategic objectives
Shareholders
and Investors
People
Customers
Suppliers
Corporate reporting and performance monitoring
–Approved the 2025 budget and the
three-year financial projections.
–Periodic review of the Group’s ability
to trade as a going concern and
its viability.
–Approved the 2023 full-year and 2024
interim results, and ensured work
was on schedule for the production
of the 2024 full-year Annual Report
and Accounts.
–Approved the release of Stock
Exchange announcements in line
with the Disclosure Guidance and
Transparency Rules, UK Market Abuse
Regulation and other requirements.
–Received regular investor relations
reports as well as regular updates
from brokers on market conditions
and equity investor sentiment.
–Received updates on the digital
modernisation of the Group.
Stakeholder groups
Link to strategic objectives
Shareholders
and Investors
People
Stakeholder engagement
–Considered the interests of the
Group’s key stakeholders.
–Group-wide customer surveys
undertaken and results reported to
the Board.
–Fifth annual employee engagement
survey undertaken, with feedback
reviewed to ensure any material
concerns were identified and suitably
addressed.
–Received regular updates on culture,
key hires, employee engagement and
organisational effectiveness.
–Reviewed feedback from the
Chairman, Committee Chairs,
Executive Directors and brokers
following meetings with shareholders.
–Reviewed feedback from the Board
Workforce Engagement sessions
conducted by the Designated
Non-Executive Director for Workforce
Engagement during the year.
Communities
and Environment
Stakeholder groups
Link to strategic objectives
Shareholders
and Investors
People
Customers
Suppliers
72
SIG Annual Report and Accounts 2024
Our long-term strategic objectives
Partner of choice
for specialist
contractors
Improving
our operating
performance
Growing sustainably
as a responsible
business
Leadership and governance
–Reviewed and, where appropriate,
approved updated terms of reference
for each of the Committees and the
Board, Directors’ conflicts of interest
and compliance with the Code.
–Conducted an annual internal
Board performance review, identified
areas for improvement and
recommended actions.
–Held the 2024 AGM as a physical
meeting. Shareholders had the
opportunity to pre-submit questions
and to ask questions during
the meeting.
–Reviewed the Group’s progress
towards compliance with the
EU Corporate Sustainability
Reporting Directive.
–Reviewed the report of the Group
Health, Safety and Environment
Director as the first item of business
on the agenda for Board meetings.
–Reviewed the reporting of the Group
against the TCFD pillars and
recommended disclosures.
–Received regular governance updates
from the Group General Counsel &
Company Secretary, including on the
amendments to the UK Listing Rules
and the UK Corporate Governance
Code 2024.
–Annual review, update and approval
of key Group-wide policies.
–Approval of the Group’s 2024 Modern
Slavery Statement, which can be
found at www.sigplc.com.
Communities
and Environment
Stakeholder groups
Link to strategic objectives
Shareholders
and Investors
People
Customers
Risk management and internal control
–Received regular reports on risk
management and internal controls
from the Audit & Risk Committee and
Chief Financial Officer.
–Approved the Group risk register, risk
appetite and principal risks.
–Received regular reports from the
Group Director of Audit and Risk.
–Reviewed progress on the five
sustainability commitments published
by the Group in March 2022 and
received updates on sustainability
activities and initiatives.
–Ongoing review of SIG’s internal
controls framework.
Communities
and Environment
Stakeholder groups
Link to strategic objectives
Shareholders
and Investors
People
Customers
Suppliers
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Governance
Financials
SIG Annual Report and Accounts 2024
Corporate governance report continued
Board activities in 2024 continued
1
2
3
4
5
Board leadership and
Company purpose
Board attendance during 2024
The following table shows the attendance of Directors at meetings of the Board and meetings of the Audit & Risk, Remuneration
and Nominations Committees during the year ended 31 December 2024:
Scheduled Board
(7 meetings)1
Scheduled
Audit & Risk
(4 meetings)
Scheduled
Remuneration
(6 meetings)
Scheduled
Nominations
(4 meetings)
Andrew Allner2
7
N/A
6
3
Gavin Slark3
7
N/A
N/A
N/A
Ian Ashton4
7
N/A
N/A
N/A
Shatish Dasani
6
4
6
4
Bruno Deschamps
7
N/A
6
4
Kath Durrant
7
4
6
4
Diego Straziota
7
N/A
N/A
N/A
Gillian Kent
7
4
6
4
Simon King
7
4
6
4
Alan Lovell
7
4
6
4
1. There were seven scheduled Board meetings and four additional meetings, which were convened principally in connection with the Group’s refinancing.
2. The Chairman attended all four Audit & Risk Committee meetings. He did not attend the Nominations Committee meeting that considered succession to his role.
3. Gavin Slark attended all four Audit & Risk Committee meetings and those sections of the Remuneration and Nominations Committee meetings to which he was
invited by the Chairs of each Committee.
4. Ian Ashton attended all four Audit & Risk Committee meetings and those sections of the Remuneration Committee meetings to which he was invited by the Chair of
the Committee.
The table shows meetings that each Director attended as a member rather than as an invitee. Where ‘N/A’ appears the Director
is not a member of the Committee although may have attended the meeting; please see the footnotes to the table. Directors do
not participate in meetings when matters relating to them are discussed. The Chairman holds meetings with the Non-Executive
Directors without the Executive Directors present. The SID meets with the independent Non-Executive Directors without
the Chairman present, in particular when the performance of the Chairman is being considered. All Directors attended the
2024 AGM.
How we manage conflicts of interest
Each Director has a duty under the Companies Act 2006 (“CA 2006”) to avoid any situation where they have, or can have, a
direct or indirect interest that conflicts, or possibly may conflict, with the Company’s interests. Provision 7 of the Code also
requires the Board to take action to identify and manage conflicts of interest, including those resulting from significant
shareholdings and to ensure that the influence of third parties does not compromise or override independent judgement.
This duty is in addition to the obligation that they owe to the Company to disclose to the Board any transaction or arrangement
under consideration by the Company in which they have, or can have, a direct or indirect interest. Directors of public companies
may authorise conflicts and potential conflicts, where appropriate, if a company’s Articles of Association permit and
shareholders have approved appropriate amendments.
Procedures have been put in place for the disclosure by Directors of any such conflicts and also for the consideration and
authorisation of any conflicts by the Board. These procedures allow for the imposition of limits or conditions by the Board when
authorising any conflict, if they think this is appropriate.
These procedures have been applied during the year and are included as a regular item for consideration by the Board at each
of its meetings. In addition the Chairman meets regularly with the independent Non-Executive Directors to ensure the interests
of all shareholders are considered. The Board believes that the procedures established to deal with conflicts of interest are
operating effectively and they are periodically reviewed to ensure they are fully compliant with the Code.
All Directors are required to complete and disclose a gifts and hospitality form confirming the offering or receipt of any gifts
or hospitality offered or provided as a result of their directorship of the Company in accordance with the Group’s Gifts and
Hospitality policy. The Board is aware of the other commitments of the Directors and is satisfied that these do not conflict
with their duties as Directors of the Company and that the influence of third parties does not compromise or override their
independent judgement.
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SIG Annual Report and Accounts 2024
Engagement
with our people
Employee policies
The Board and its Committees
reviewed and approved key employee
policies during the year to ensure they
reflect the Group’s values and culture.
These include the Group’s Code
of Conduct, and Health and Safety;
Whistleblowing; Anti-Bribery and
Corruption; Diversity, Equality and
Inclusion; GDPR; and Gifts and
Hospitality policies. All employees,
including the Board, and contractors,
are required to complete online
training and reminders are issued
when required, to ensure that training
is completed. As new policies are
developed, appropriate training is
provided to all employees.
Health and safety
The Board is regularly updated at
Board meetings on health and safety
matters and on investigations and
their outcomes. The Board is
committed to ensuring high
standards of health and safety
are maintained across the Group.
Employee
engagement survey
The annual employee engagement
survey was conducted during the
year to ensure that every employee’s
voice is heard and to ensure we
maintain an inclusive, supportive
working environment for our people.
This year’s survey highlighted certain
areas as key strengths including
commitment and culture. Responses
also identified areas that need further
improvement, such as workloads
and career opportunities. The Board
will continue to monitor progress
against these areas.
Whistleblowing
Board members receive regular
updates on whistleblowing, which
include details of whistleblowing
reports received via the external
whistleblowing service. The Board
identifies and addresses any
incidents and areas for improvement.
How the Board monitors culture
The Board has responsibility for ensuring that workforce policies and practices are in line with the Group’s purpose and values
and support the desired culture. The Group’s culture and values are defined by the Board and the ELT and throughout the year
the Board has monitored Company culture. The right culture is key to future success and the goal is to create a winning, vibrant
and modern culture which combines discipline, clear expectations and effective processes with entrepreneurial spirit.
During the year, the Board monitored culture through a range of interactions, including interactions with employees.
Workforce engagement
Board activities in action
What has gone well
The culture has also given teams agility and speed to
look after customers in today’s fast changing world.
Our apprentice programmes in Germany and France were
recognised by local leaders as successful and effective,
with many apprentices being very capable of implementing
new systems fast. A number of branch leaders recognised
the positive impact that ongoing local investment to
upgrade facilities have had on efficiency, safety and
team morale.
Where can we improve
The teams were slightly more concerned about the cost
of living and job security than during last year’s visits,
given the weaknesses in the wider economy and the
construction sector across Europe. Some colleagues
expressed concerns about their longer-term pay prospects
at SIG and the impact this is having on their personal
financial goals, as the costs of living have risen but pay
has not always kept up with this.
Simon King
Designated Non-Executive Director
for Workforce Engagement
As the Designated Non-Executive Director responsible
for workforce engagement, I am privileged to meet with
employees each year to understand their insights and views.
This year I met numerous groups of employees in France,
Germany, Scotland and England.
Our people feel empowered by our local branch-based
business model. They feel enabled to make the right
decisions for their local customers, value this and recognise
it as a strength and differentiator of SIG. This culture of local
empowerment and trust was mentioned by our people in
every visit.
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Corporate governance report continued
Engagement with
our stakeholders
1
2
3
4
5
Board leadership and
Company purpose
Shareholders
and Investors
People
Customers
Why it is important we engage
Under Section 172 of the CA 2006 Directors
have a duty to act in good faith to promote
the success of the Group for the benefit of
the Company’s members as a whole.
Shareholders’ views are important as part of
the Board decision-making process and we
welcome discussions with them.
Why it is important we engage
SIG is a people business: engagement by the
Group with its stakeholders is through its
people. Accordingly, engagement by the
Group with its workforce underpins SIG’s
success. SIG’s growth and sustainability
depends on having the right company culture,
supported by suitable behaviours and with a
clear purpose.
Why it is important we engage
Understanding the needs and requirements
of our customers is hugely important and the
Group seeks to use this knowledge to partner
effectively with our customers. Customer
service is vital to maintaining and growing
revenues and profits, and we engage with our
customers to develop our sales relationships
to improve our service and continually
develop and refresh our product offering.
How we engage across
the Group
– Publication of annual and interim reports.
– Corporate website with a dedicated
investor section and details of our
strategy, business model and ESG
activities.
– Results presentations and post-results
engagement with major shareholders
and lenders.
– Investor roadshows, face-to-face
meetings and addressing regular investor
and analyst enquires.
– Regulatory Stock Exchange
announcements.
How we engage across
the Group
– Annual all-employee engagement survey.
– Individual performance reviews.
– Regular communications to employees on
Workplace relating to company news and
recognising achievements.
– Site visits by the Board and ELT.
– Employee share incentive scheme.
– Training and development.
– Apprenticeships.
How we engage across
the Group
– Annual Group-wide customer
engagement survey.
– Management at local level of customer
relationships.
– Listening to customer feedback to
understand the needs of our customers.
– Improving digitally to better communicate
and facilitate customer requests and
requirements.
– Ensuring appropriate stock levels and
product ranges at branches to facilitate
customer needs.
How we engage at Board level
– CEO and CFO meetings with
shareholders and lenders as part of
investor roadshows and ad-hoc meetings
as appropriate.
– Meetings between shareholders and
Directors, including the Chairman and
Chairs of Board Committees.
– Meeting shareholders at the Annual
General Meeting.
– Reviewing the voting results of
shareholders who voted at the 2024 AGM.
– Engagement with investors as part of the
debt refinancing process.
How we engage at Board level
– The Designated Non-Executive Director for
Workforce Engagement meets regularly
with employees across the operating
companies.
– Regular health and safety reports are
presented to the Board.
– Feedback is reviewed from the annual
employee engagement survey.
– Annual review and approval of all-employee
policies and training.
– Further details on Board-level engagement
with employees and how the Board
monitors culture can be found on page 75.
How we engage at Board level
– Reviewed the actions proposed to be
taken by management in light of the
findings of the annual Group-wide
customer engagement survey.
– Monitored engagement between
management and customers where the
latter had sought more information about
the sustainability of the products sold by the
Group and the steps being taken by the
Group to reduce its carbon footprint.
– The Board continued to focus on the steps
being taken by management in progressing
the digitalisation and modernisation of the
Group in response to customer requests
and to anticipate future demands.
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Suppliers
Communities
and Environment
Why it is important we engage
SIG enjoys a pivotal position in industry supply
chains: we connect suppliers and customers
in ways which they would be unlikely to
achieve without SIG’s presence. We are a
principal route to market for many of our
suppliers and we seek to add value for our
suppliers by operating as their supply chain
partner of choice. We engage with our
suppliers to understand their businesses and
to identify ways in which we can work with
them strategically.
Why it is important we engage
The Directors appreciate that environmental
matters are important to all stakeholder
groups who are calling on companies to do
more on key sustainability topics and to be
more transparent about their efforts. SIG
seeks to operate sustainably for the benefit
of communities and the environment.
The Directors recognise that having close
relationships with the communities in which
SIG businesses operate supports the
long-term success of the business.
How we engage across
the Group
– Our code of conduct and policies on the
prevention of anti-bribery and corruption
and modern slavery.
– Ensuring branches are close to suppliers.
– Membership of national trade and industry
associations such as the Construction
Products Association in the UK.
– Collaborating regularly with suppliers to
ensure a supply of sustainable products for
our customers.
– Discussions on supply chain (Scope 3)
carbon emissions.
How we engage across
the Group
– Monthly Sustainability Committee meetings,
which include the CFO, CPO and Company
Secretary together with function experts
from across the Group.
– Waste and Fleet forums to facilitate the
Group’s waste and carbon reduction
commitments.
– Throughout the year, our local businesses
supported various charities through
fundraising efforts and other initiatives
to help those in need in the communities
in which we operate.
How we engage at Board level
– Members of the ELT meet with our
suppliers in their local geographies.
– Reports to the Board made by the CEO
regarding relationships with major suppliers.
How we engage at Board level
– Regular updates from Sustainability
Committee meetings to understand key
sustainability initiatives across the Group
and progress to achieve the sustainability
commitments.
– Overseeing, considering and reviewing
the Group’s Environmental, Social and
Governance Strategy and sustainability
commitments.
– This year the Board reviewed the Group’s
progress towards reporting under the
EU Corporate Sustainability Reporting
Directive.
How the Board considered
stakeholders during the year
Debt refinancing
During the year, the Board
considered the proposed debt
refinancing of the Group’s existing
bond and the issuance of a new
bond to proactively manage the debt
structure and liquidity of the Group.
As part of the Board’s decision-
making, stakeholder views were
considered including feedback from
investors and the need to create
long-term value for shareholders.
The Board considered that the
refinancing would allow management
to maintain its clear focus on the
delivery of the strategic roadmap
and benefit from the expected
construction market recovery when
it occurs. In addition, the refinancing
would provide certainty on the
Group’s long-term funding to
shareholders, customers, suppliers
and to the Group’s employees.
Following a thorough review, the
Board decided that the refinancing
would be for the benefit of its
members as a whole, having given
fair consideration to all members
and key stakeholders of the Group.
The Board worked closely with the
Group’s financial advisor and lead
advisor bank to ensure that the
refinancing resulted in the optimal
result for the Group. The Board was
involved in the drafting and review of
the Offering Memorandum for the
new bond, working closely with the
Group’s legal advisors.
The Board ensured that employees
were aware of their obligations under
the UK Market Abuse Regulation
prior to announcing the transaction
to the market. The Board is confident
that the refinancing will deliver
benefits for all members and
stakeholders of the Group.
Directors’ Section 172 statement
SIG seeks to foster flexible and constructive relationships with
its key stakeholder groups and recognises that the vitality of
its strategy is enriched by stakeholder views and feedback.
The Directors consider that they have performed their fiduciary
duty, as stipulated under Section 172 of the CA 2006 in good
faith to promote the success of the Group for the benefit of
its members as a whole.
They have taken into consideration, amongst other matters:
–the likely long-term consequences of their decisions;
–the interests of the Group’s employees;
–the need to foster relationships with suppliers, customers
and others;
–the desirability of the Group maintaining a reputation for
high standards of business conduct; and
–the need to act fairly between members of the Company.
77
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Governance
Financials
SIG Annual Report and Accounts 2024
Corporate governance report continued
How our Board
is structured
1
2
3
4
5
Division of
responsibilities
Relationship with CD&R
SIG’s relationship with CD&R is
governed by the Relationship Agreement
entered into in 2020. Under the
Relationship Agreement, CD&R has the
right to nominate two non-independent
Non-Executive Directors. The CD&R
nominated Non-Executive Directors are
Bruno Deschamps and Diego Straziota.
Bruno is a member of the Nominations
Committee and the Remuneration
Committee. Diego attends Audit & Risk
Committee meetings as an observer.
The Relationship Agreement provides
for the CD&R Non-Executive Directors
to have a regular meeting with the CEO
and management. This is fulfilled
through operational review meetings
involving the Chairman, CEO, CFO,
Group General Counsel & Company
Secretary and, by invitation, one of the
independent Non-Executive Directors.
Meetings are structured as two sections:
either with two operating companies
or with one operating company and a
second session dealing with a separate
business matter. During 2024, each
operating company presented to at least
one operational review meeting. All
papers for operational review meetings
are made available to the full Board.
A debrief on the matters discussed
at each meeting is provided by the
CD&R Non-Executive Directors at
the subsequent Board meeting.
Bruno and Diego’s industry experience
and knowledge is of significant value to
the operating companies. Under the
Relationship Agreement, any actual or
potential conflict between the interests
of CD&R and/or either of the CD&R
Non-Executive Directors and SIG must
be declared, and the relevant CD&R
Non-Executive Director may be
prevented from voting on any such
matter. At each Board meeting all
Directors are required to declare any
new conflicts of interest. The Board
greatly appreciates the contribution
made during 2024 by Bruno and Diego,
and CD&R more generally, and believes
it significantly benefits all of SIG’s
shareholders and stakeholders.
More information on our engagement with
shareholders can be found on page 76.
Committees of the Board
Audit & Risk
Committee
Monitors the integrity of
financial reporting and
the performance of the
external Auditor and
reviews the effectiveness
of the Group’s risk
management and
internal control
framework and related
compliance activities.
Nominations
Committee
Regularly reviews the
structure, size and
composition of the
Board and oversees
the development of a
diverse pipeline for
orderly succession to
the Board and senior
management positions.
Working with HR, takes
an active role in setting
and working towards
diversity objectives
and strategies for
the Group.
Remuneration
Committee
Agrees with the Board
the framework or broad
policy of remuneration
for the Chairman,
Executive Directors and
senior executives, and
sets their remuneration.
Reviews remuneration
policies across the
Group, ensuring the
alignment of workforce
remuneration and
incentives with the
Group’s culture
and strategy.
Read more
on pages 84 to 87
Read more
on pages 88 to 95
Read more
on pages 98 to 119
Shareholders
Our shareholders are the ultimate owners of the Company and
play an important role in the governance structure.
The Board
The role of the Board is to promote the long-term sustainable success
of the Group, generating value for shareholders and contributing to
wider society. More information on the Board’s responsibilities can be
found in the Schedule of Matters Reserved for the Board and the
Board’s terms of reference, available on our website.
Members are those individuals listed on pages 80 to 81
Executive Leadership Team
The ELT addresses operational issues and is responsible
for implementing Group strategy and policies, day-to-day
management and monitoring performance.
To ensure the Board performs effectively, there is a clear
division of responsibilities between the leadership of the
Board, its Committees and the ELT.
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SIG Annual Report and Accounts 2024
Board roles and
responsibilities
Non-Executive Directors
Executive Directors
Chairman
–Leads the Board, responsible for its
overall effectiveness in directing
the Group.
–Chairs Board and Nominations
Committee meetings and setting
agendas for those meetings.
–Shapes the culture in the Boardroom,
ensuring that all Directors contribute
effectively, and leads Board
succession planning.
–Ensures an appropriate balance is
maintained between the interests of
shareholders and other stakeholders.
–Promotes high standards of corporate
governance.
–Ensures all Directors receive a
substantive induction on joining
the Board.
Chief Executive Officer
–Ensures effective leadership and
day-to-day running of the Company.
–Responsible for proposing, delivering
and implementing the strategy
approved by the Board.
–Leads the ELT and oversees
key functions.
–Regularly reviews the organisational
structure including development and
succession planning.
–Responsible for setting an example
to the Group’s workforce, for
communicating to them the
expectations in respect of the Group’s
culture and for ensuring that
operational policies and practices
drive appropriate behaviour.
–Ensures the Chairman and Board
are advised and updated regarding
key matters.
Non-Executive Directors
–Provide constructive challenge to the
Executive Directors.
–Provide strategic guidance to
the Company.
–Offer specialist advice.
–Scrutinise and hold to account
the performance of the Executive
Directors against agreed performance
objectives.
Designated Non-Executive
Director for Workforce
Engagement
–Oversees the Board’s engagement
with the Group’s workforce.
–Gathers views of employees through a
variety of formal and informal channels
and identifies any areas of concern.
–Strengthens the link between the
Board and employees.
Group General Counsel
& Company Secretary
Independent advisor to the Board and
Chief Legal Officer to the Group.
–Keeps the Board up to date on
all relevant legal and governance
requirements.
–Supports the Chairman and
Committee Chairs to set meeting
agendas and ensure Directors receive
accurate, timely and clear information.
–Ensures Board procedures and best
practice governance arrangements
are followed, and decisions are
implemented.
Senior Independent Director
–Acts as a sounding board for
the Chairman.
–Available for approach by shareholders,
where communications through the
Chairman or Executive Directors may
not be appropriate.
–Attends sufficient meetings with major
shareholders to obtain a balanced
understanding of the issues and
concerns of such shareholders.
–Leads the evaluation of the Chairman’s
performance at least once a year,
meeting with the Non-Executive
Directors, without the Chairman
being present.
–Leads the succession process for
the Chairman.
Chief Financial Officer
–Leadership, direction and management
of Group Finance, including tax and
treasury matters.
–Leads financing and funding matters.
–Oversight of, and guidance to, the
operating companies’ Finance teams.
–Responsible for monitoring and driving
financial performance across the
Group with rigour and consistency.
–Establishing and maintaining adequate
internal controls and ensuring the
integrity of all internal and external
financial reporting.
–Oversees the production of the
Group’s annual budget for approval
by the Board.
–Develops long-term financial plans.
–Investor relations.
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Financials
SIG Annual Report and Accounts 2024
Corporate governance report continued
Our Executive
Leadership Team
as at 4 March 2025
1
2
3
4
5
Division of
responsibilities
Gavin Slark
Chief Executive Officer
See Gavin’s biography
on page 70.
Ian Ashton
Chief Financial Officer
See Ian’s biography on page 70.
Julie Armstrong
Chief People Officer
Julie joined SIG as Chief People
Officer in 2021, bringing over 21
years’ experience across various
roles in and outside of HR roles.
Prior to joining SIG, Julie was Chief
People Officer at Calisen Group.
Prior to this, Julie held the position
of Group HR Director at Thomas
Cook and served as Customer
Services Director at Manchester
Airports Group.
David Hope
Managing Director
UK Specialist Markets
David re-joined SIG in 2020. He has
over 26 years of industry expertise
and held various roles at SIG from
2007 to 2017. He was appointed
Managing Director UK Construction
Accessories and Specialist Markets
in 2022 and joined the ELT in 2023.
David was previously Managing
Director UK & Ireland Packaging
at Antalis and Managing Director
of Springvale EPS Insulation, a
business division of CRH plc.
Alfons Horn
Managing Director Germany
Alfons re-joined SIG in 2021 and
has over 26 years’ experience in the
distribution and building materials
industry. From 1998 to 2016, he held
various positions with SIG Germany,
including Managing Director and
Chairman of the Management
Board. Alfons has held several
senior executive and advisory roles
within the industry, he served as
Regional President for BMI Monier
and Managing Director for Contract
Company Holding GmbH.
Chris Lodge
Managing Director
UK Roofing
Chris joined SIG through an
acquisition in 2005 and has held
several finance roles including,
most recently, UK Finance Director.
In 2023, he became Managing
Director UK Exteriors and joined
the ELT. Chris brings over 27
years of experience in specialist
merchanting, with prior roles held
at SIG Roofline & Building Products
and Omnico Plastics Limited.
Howard Luft
Managing Director
UK Interiors
Howard joined SIG in October 2024
as Managing Director UK Interiors.
He has a strong background in
building materials with over 40 years
of experience in the sector. Prior
to joining SIG, Howard was Chief
Executive Officer at Selco Builders
Warehouse. He previously served as
Managing Director of CCF at Travis
Perkins Group plc and Managing
Director of Crown Paints at
Buck & Hickman.
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SIG Annual Report and Accounts 2024
Julien Monteiro
Managing Director France
Julien joined SIG in 2018 as
Managing Director of SIG France.
Prior to joining SIG, Julien served
as Managing Director at Brammer
Group and held senior positions
at Nacco Materials Group. Julien
has over 16 years of international
experience in the specialist industrial
distribution industry.
Sarah Ogilvie
Head of Investor Relations
& Communications
Sarah joined SIG in 2022 and joined
the ELT in 2023, overseeing investor
relations and communications.
Sarah has over 21 years’ experience
in corporate affairs and investor
relations, holding prior roles
at Intertek Group plc, Accys
Technologies plc and Good Energy
plc. Her career began in corporate
law and corporate affairs in the
telecommunications sector.
Bert de Ru
Managing Director Benelux
Bert joined SIG in 2023 as Managing
Director Benelux. He brings a wealth
of expertise in the building materials
and pitched and flat roofing markets,
having gained experience with
renowned international companies,
including BMI Monier and Icopal
over the last 14 years.
Marcin Szczygiel
Managing Director Poland
Marcin joined SIG in 1999 as
Managing Director of SIG Poland.
With over 26 years of experience
in the specialist construction
distribution industry, he previously
served as Managing Director
at Sitaco. Prior to this, he held
various positions at Saint Gobain
Isover before becoming Sales and
Marketing Director for Isover Poland.
Andrew Watkins
Group General Counsel &
Company Secretary
Andrew joined SIG in 2019. He has
over 26 years’ experience as legal
counsel across public and private
sectors. Prior to joining SIG, Andrew
was General Counsel at Hyve
Group plc and General Counsel &
Company Secretary at Ebiquity plc.
Andrew began his career working
in law firms, including Trowers
& Hamlins LLP where he was
a Partner.
Kevin Windle
Managing Director Ireland
Kevin joined SIG in 2014 as Finance
Director Ireland and was appointed
Managing Director Ireland in 2019.
Prior to joining SIG, Kevin was the
EMEA Finance Director for Glanbia
Performance Nutrition and held
the position of Finance Director for
Grafton Merchanting Ireland. Kevin
has over 23 years of experience in
finance and leadership roles within
the building merchanting industry.
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Financials
SIG Annual Report and Accounts 2024
Corporate governance report continued
1
2
3
4
5
Division of
responsibilities
Board arrangements
Managing time commitments
The Board is satisfied that there is no
compromise to the independence of
Directors who have other external
appointments. Each of the Non-
Executive Directors brings their own
senior level of experience and expertise,
and the balance between non-executive
and executive representation encourages
healthy independent challenge.
Prior to appointment, Directors are
required to disclose other directorships.
The Nominations Committee reviews
the commitments of Directors upon
appointment, any proposal for
reappointment and following a change
in roles, to ensure that each of the
Directors has sufficient time to fulfil their
responsibilities. Directors must not take
on additional external appointments
without the approval of the Board.
Board support
The Directors have full access to the
Company Secretary, whose responsibility
is to ensure that Board policies and
procedures are followed, including
minuting of any unresolved concerns
that any Director may have in connection
with the Group. During the year there
were no such unresolved issues.
Directors wishing to take independent
legal advice in the furtherance of
their duties may do so at the Group’s
expense. On resignation, if a
Non-Executive Director had any
concerns, the Chairman would invite
them to provide a written statement
to the Board. The appointment and
removal of the Company Secretary is
a matter reserved for the Board. The
Board and its Committees are provided
with sufficient resources to undertake
their duties. Appropriate training is
available to all Directors on appointment
and on an ongoing basis as required.
The Group operates a paperless
meeting system for the Board and its
Committees, which supports our online
drive across the Group and impact on
the environment. Board and Committee
papers are accessible to Directors
through an electronic portal as well
as information such as analyst and
shareholding reports and financial
results. There is a ‘Reading Room’
within the portal where Directors
can view other relevant Company
information. The Group General Counsel
& Company Secretary attends all Board
meetings and is at hand to answer
questions or offer independent advice
or expertise to Directors.
Election and re-election
of Directors
All Directors are subject to election at
the AGM following their appointment
and to re-election every three years. In
accordance with the Code, all Directors
seek election or re-election at the AGM
each year.
The 2025 Notice of AGM includes the
skills and experience that each Director
has, and a statement as to why their
contribution is and continues to be
important to the Group’s long-term
sustainable success.
It is the view of the Board that each of
the Non-Executive Directors standing
for re-election brings considerable
management experience and an
independent perspective to Board
discussions and is considered
independent of management. Each
of the independent Non-Executive
Directors standing for re-election is
considered free from any relationship
or circumstance that could affect, or
appear to affect, the exercise of their
independent judgement.
The Chairman intends to confirm at
the AGM that, as evidenced by the
2024 Board performance review, the
performance of each individual Director
continues to be effective, and each
Director acts with integrity, leads by
example, promotes the desired culture
and demonstrates commitment to
the role.
The terms of the Directors’ service
contracts are disclosed in the Directors’
remuneration report on page 118. Full
details of Directors’ remuneration,
interests in the share capital of the
Company and share options held are
set out on page 115. Directors’ service
contracts and the letters of appointment
of the Non-Executive Directors are
available for inspection at the Company’s
registered office and will be available
at the 2025 AGM.
Training and induction
The Chairman reviews with the Board
its training and development needs.
All Directors receive induction
training on their Directors’ duties, the
responsibilities of a listed issuer, and
the obligations of a company admitted
to the Equity Shares (Commercial
Companies) category of the Official
List of the FCA. The Board receives
appropriate presentations from advisors
and management on a range of topical
issues, such as from the Group’s
financial advisors in relation to the
macroeconomic and industry backdrop
and sector dynamics that SIG faces.
On appointment, Directors receive an
induction to the Group. This involves
meetings with each Board member, ELT
members, external advisors (such as
brokers, auditors and financial advisors),
visits to branches, and access to key
corporate materials. The programme
ensures that they are well briefed on
current Board topic areas, the Group’s
strategy, purpose and structure,
stakeholder engagement activities,
operations, finance and the industry.
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SIG Annual Report and Accounts 2024
Board performance review
The Board undertakes an annual review of its own and its Committees’ performance.
The recommendations from the 2023 performance review are set out below together with a summary of the progress that was
made to satisfy the recommendations during the year.
2023 recommendations
Action taken during 2024
Maintain the Group’s focus on
short-term financial performance,
within the context of prevailing
market conditions, alongside
continuing focus on long-term
value creation
Prevailing market conditions in the majority of the Group’s countries of operation,
including notably its largest markets in the UK, France and Germany, were
challenging. Accordingly, the Board spent significant time during the year reviewing
current trading and considering ways in which the short-term performance of the
business could be safeguarded and improved. The Board also remained mindful of
the need to sustain and build long-term value creation. The decision to refinance the
Group’s senior debt in the second half of the year was to provide a secure funding
platform from which value can be driven across the medium-term, for the benefit of
shareholders and all stakeholders.
Continue the turnaround in the
UK Interiors business
Considerable work has been done in recent years to improve the UK Interiors
business, much of which has been masked, in terms of financial improvements, by
the difficult market conditions that have prevailed in this time. To build upon these
improvements, a new Managing Director joined the business in October with a clear
objective to deliver improved financial returns.
Review of, and ongoing visibility
over, the strategic and operational
plans of each operating company
to achieve their medium-term
margin targets
The Board reviewed plans from the operating companies that set out how each of
them intends to achieve their medium-term margin targets. The Board critically
assessed the plans and passed feedback to the executive management to be
considered by the operating company management teams for the further iteration
of those plans.
Further development of talent and
culture across the organisation
The Board was pleased that, despite the challenging trading markets experienced
in the year, the results from the 2024 employee engagement survey were broadly
consistent with the previous year. Notably, there was modest improvement in
the overall response rate together with slight improvement in the culture index.
The Board was also pleased to receive from the Nominations Committee updates
on measures taken to develop talent across the Group.
Process and outcomes of the
2024 Board and Committee
performance review
During the year, the Board approved
a questionnaire to be completed by
all Directors with certain questions
requiring, in addition, open text comment
answers. The questionnaire focused on
several key topics aligned to the Code,
including Board leadership and culture;
Group purpose and strategy; and Board
and ELT composition and succession,
including diversity, equality and inclusion.
There were subsets of the questionnaire
specific to each of the Audit & Risk
Committee, the Remuneration
Committee and the Nominations
Committee.
The 2024 Board and Committee
performance review was led by the
Chairman and the Group General
Counsel & Company Secretary and the
responses to the questionnaire were
discussed with the Chairs of each of
the Committees regarding the sections
of the questionnaire specific to those
Committees. As part of the review, the
Chairman met with the Non-Executive
Directors individually to discuss the
feedback on their performance, and the
SID met with the Chairman to discuss
his performance.
The Board priorities for 2025 include:
–Developing the plan to make the Group
a profitable, cash generative, and
financially sustainable business and
one thereby capable of creating value
for shareholders.
–Making material progress in addressing
the UK Interiors business through
focused Board reviews, understanding
the issues and challenges, and
supporting the management team.
–Continuing to drive the talent agenda,
ensuring retention and strong
incentivisation of high performing
leaders whilst also addressing areas
of weakness and underperformance.
Board review of culture.
Further information on the objectives set
by each Committee for 2025 can be
found in their reports.
1
2
3
4
5
Composition, succession
and evaluation
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Financials
SIG Annual Report and Accounts 2024
Corporate governance report continued
Nominations
Committee report
Committee members
Andrew Allner1 (Chairman)
Alan Lovell
Bruno Deschamps
Gillian Kent
Kath Durrant
Shatish Dasani
Simon King
1. Independent on appointment.
On behalf of the Nominations Committee
(‘the Committee’), I am pleased to
present its report for the year ended
31 December 2024. The report
describes how the Committee has
carried out its responsibilities during
the year.
Committee purpose and aims
To lead the process for Board
appointments, ensure plans are in place
for orderly succession to both Board
and senior management positions, and
oversee the development of a diverse
talent pipeline for succession.
The Committee aims to maintain
the appropriate balance of skills,
knowledge, experience, diversity and
independence of the Board and its
Committees to ensure their continued
effectiveness.
Role and responsibilities
To review the structure, size and
composition (including the skills,
knowledge, experience and diversity)
required of the Board compared to its
current position and in light of future
challenges affecting the business.
To make recommendations to the Board
regarding any changes, to ensure that
plans are in place for the orderly
succession and development of
Directors and other senior executives,
and to oversee the development of a
diverse pipeline for succession. To
ensure that all newly appointed Directors
undertake appropriate induction training
to ensure that they are fully informed of
the strategic and commercial issues
affecting the Group and the markets in
which it operates, as well as their duties
and responsibilities as a Director of
the Board.
Working with the Chief People Officer,
to take an active role in setting and
meeting diversity objectives and
strategies for the Group as a whole.
Meetings and membership
During the year, the Committee met
on four occasions. The quorum for
meetings is three members, the
majority of whom must be independent
Non-Executive Directors. Members of
the Committee are not involved in
matters affecting their own position.
The Committee comprises the Chairman
and six Non-Executive Directors
of whom five are independent
Non-Executive Directors. No Executive
Directors are appointed to the
Committee; however, they may attend
by invitation if the matters to be
discussed require their participation.
The Chief People Officer attends
Committee meetings. Attendance
at Committee meetings is set out
on page 74.
Highlights from the year
–Reviewed succession planning and
talent development for the Board and
senior management.
–Considered the Executive Leadership
Team composition including changes
to membership during the year.
–Reviewed the Board composition
and membership of Committees.
–Reviewed diversity and inclusion
across the Group.
Andrew Allner
Chair of the Nominations Committee
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Board composition (%)
Independent Non-Executive Directors
6
Non-Independent
2
Executive Directors
2
Board gender balance (%)
Male
8
Female
2
Ethnic diversity (%)
White British/other white
9
Asian/Asian British
1
Board tenure (%)
0-4 years
4
4+ years
6
Strategy/M&A
Construction or distribution sector experience
Technology/digital
Health & Safety
Sustainability/ESG
Financial expertise
Listed company/corporate governance
International
29
27
20
19
21
24
28
27
23
Risk management
Summary of Directors’ skills¹
As at 4 March 2025
The Committee in 2024
Board composition and
succession planning
The Board comprises ten Directors: the
Chairman of the Board, two Executive
Directors, and seven Non-Executive
Directors, of whom five are independent
Non-Executive Directors.
During the year, and in accordance
with its usual practice, the Committee
reviewed the wider composition and
balance of the Board. The review
considered the membership of the
Committees of the Board, the balance
on the Board between Executive and
Non-Executive Directors, the tenure of
the Directors, diversity on the Board and
the independence of the Non-Executive
Directors. The Non-Executive Directors,
other than Bruno Deschamps and
Diego Straziota who are CD&R
representatives on the Board, are
considered independent as at the date
of this report. On appointment to the
Board, the Chairman was considered
independent in accordance with the
terms of the Code.
There were no changes to the
composition of the Board during the
year. The Committee will continue
to keep under review the skills and
experience of the Board, covering both
Executive and Non-Executive positions,
ensuring plans are in place for orderly
succession, to ensure the Group
continues to compete effectively in
the markets in which it operates.
The Committee acknowledges that
Board succession planning will be a
topic of focus in the coming years, as
several Directors near the end of their
tenures. The Committee will lead
the appointment process for new
Director appointments and take into
consideration the need for diversity on
the Board. For more information on the
biographical details for each Director
see pages 70 to 71.
1. The Board were asked to score themselves from 0 (no/little experience) to 3 (detailed knowledge/
experience) to give a score out of 30 for each topic.
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Corporate governance report continued
Non-Executive Directors are initially
appointed for a three-year term and their
reappointment for a further term is a
matter for approval by the Committee.
In making recommendations for the
annual re-election of the Chairman and
Non-Executive Directors, the Committee
considers the skills, knowledge,
experience, independence and the time
commitments of each Director to ensure
that they have sufficient time to fulfil
their responsibilities to the Group. In
accordance with the Code all Directors
will accordingly be put forward for
re-election at the 2025 AGM. Details of
the reasons each Director continues to
contribute to the success of the Group
are contained in the Notice of AGM.
Group Executive Leadership
Team changes
In August, it was announced that
Howard Luft would join SIG as
Managing Director of UK Interiors.
Howard joined the Group from Selco
Builders Warehouse where he served
as CEO for seven years. Howard has a
strong background in building materials
distribution with over forty years of
experience in the sector. Biographical
details of ELT members can be found
on pages 80 to 81.
Talent and succession planning
During 2024, the Committee considered
succession planning for both the ELT
and the European Leadership Group
(‘ELG’). The Committee has visibility of
a range of employees who have been
identified as potential succession
candidates for such roles in the short,
medium and long-term. The Committee
reviews the development programmes
for these individuals to ensure there is
a diverse pipeline of future leaders.
The Committee is committed to
proactively identifying and developing
leadership from within the Group whilst
ensuring that we attract applications
from high calibre external candidates.
To achieve this we will continue to invest
in leadership and executive development
to ensure a diverse balance of future
successors for key roles within
the Group.
Diversity and inclusion
The Board acknowledges the
importance of diversity in its broadest
sense in the Boardroom as a driver
of Board effectiveness. The Board
recognises that gender, ethnic, and
social and cultural diversity of boards
are significant aspects of diversity and
acknowledges the role that women
and those of different ethnic, social and
cultural backgrounds with the right skills,
experience, cognitive and personal
strengths can play in contributing
to diversity of perspective in the
Boardroom. The Board also aspires to
achieve diversity levels for each of its
Committees at least consistent with the
diversity achieved for the Board itself.
The policy on Board diversity, which
complements the Group’s wider
diversity policies and our strategic
vision, was reviewed by the Board
during the year and is available on
the Group’s website.
The Board acknowledges that, as at 31
December 2024, whilst it met two out of
the three UK Listing Rules (‘UKLR’)
diversity targets, its composition did not
yet meet the UKLR requirement of
female representation of at least 40%.
The Board comprises ten Directors, of
whom two are women. Of the six
independent Non-Executive Directors,
one-third are women. CD&R has the
right to appoint two Directors, under the
Relationship Agreement, and CD&R’s
two appointees to the Board are both
male. On a statistical level, this makes
meeting higher thresholds of gender
diversity more challenging whilst
maintaining what the Board considers
to be an appropriate and effective size.
With Kath Durrant being SID we have
achieved the UKLR requirement of
having at least one senior Board
position held by a female. We also meet
the Parker Review and UKLR target of
ensuring at least one Board member is
from an ethnic minority background.
As at 31 December 2024, representation
of women within the ELT was 21%, and
within the ELT and their direct reports
was 28%. The Committee recognises
that female representation at Board
level and at our most senior levels can
be improved. The Board and senior
leadership’s gender identity and
ethnicity data presented in accordance
with Listing Rule 6.6.6R (9) can be
found on page 121.
The Committee receives regular
information on diversity from across
the Group except from those countries
where the law does not permit such
information to be gathered. The Group
continues to ensure where possible
that recruitment for any new roles has
a short-list of diverse candidates.
In 2022, SIG established a Group-wide
diversity, equality and inclusion (‘DEI’)
forum, including representation
from each operating company and
employees across the business. A
Group DEI framework was established
to guide activities across the business,
while allowing each operating company
flexibility to ensure alignment to local
culture. The programme aims to
enhance DEI awareness across SIG.
Further information on our Group-wide
DEI activities during the year can be
found on page 40.
Review of Committee terms
of reference
During the year, the Board reviewed the
terms of reference of the Committee and
made a number of non-material updates
to them. These can be found on the
Group’s website at www.sigplc.com.
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Committee performance review
An internal performance review of the Committee was conducted for 2024 and further details can be found on page 83.
The recommendations from the Committee’s 2023 performance review are set out below together with a summary of the
progress that was made to satisfy the recommendations during the year:
2023 recommendations
Action taken during 2024
Succession planning
for Board
membership
The Committee reviewed the tenures of each of the Directors, noting that some Directors are now
serving, or are due to shortly begin serving, their final terms of office. The Committee, including the
Chairman, also considered the skills of the Board together with the skills that the Board is likely to
require to assist the Group in delivering its medium-term margin targets. This work has provided a
platform from which the Committee can take forward its succession planning for the Board during
2025 and beyond.
ELT succession
planning
During the year, there was one change made to the membership of the ELT, which was to the
Managing Director of the UK Interiors business. The Committee considered the stage of the
turnaround of the business and the skills and experience required to advance the turnaround
through its next phases. The Committee’s view was that Howard Luft was the right appointment
for the operating company. More broadly, the Committee built on its work in previous years in
reviewing succession planning for the ELT which this year included a review of the first-line reports
of the operating company Managing Directors.
Identification and
preparation of
diverse talent
pipelines
During the year, each of the operating companies completed a talent and organisation capability
review with the CEO and Chief People Officer. The review assessed the strength of talent and
succession pipelines, diversity and how each business developed their skills, knowledge and
specialisms to deliver the business strategy. The Committee reviewed the outputs of these sessions,
which covered the key issues and progress of each operating company to develop diverse talent
pipelines.
The priorities that the Committee has established for 2025 include:
–Board structure and succession.
–Review of ELT talent and succession.
–Review of talent pipelines for leadership and critical roles.
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Corporate governance report continued
Audit & Risk
Committee report
Committee members
Shatish Dasani (Chair)
Alan Lovell
Gillian Kent
Kath Durrant
Simon King
On behalf of the Audit & Risk Committee
(‘the Committee’), I am pleased to
present its report for the year ended
31 December 2024. The report
describes how the Committee has
carried out its responsibilities during
the year.
Committee purpose and aims
To provide effective oversight and
governance over the integrity of the
Group’s financial reporting (including
climate-related financial disclosures)
so as to ensure that the interests of
the Company’s shareholders and other
key stakeholders are considered and
protected.
To make recommendations on the
reporting, control, risk management and
compliance aspects of the Directors’
and Group’s responsibilities, providing
independent monitoring, guidance and
challenge to senior management in
these areas.
The Committee’s aims are to ensure
high standards of corporate and
regulatory reporting; an effective risk
management and internal control
framework; and effective compliance
monitoring. The Committee believes
that excellence in these areas enhances
effectiveness and reduces the risks
of the Group to an acceptable level.
Role and responsibilities
The Committee supports the Board in
fulfilling its oversight responsibilities in
ensuring the integrity of the Group’s
financial reporting, internal controls
and overall risk management process,
and relationship with the Company’s
external Auditor.
Financial reporting
–Monitoring and reviewing the Group’s
accounting principles, practices and
policies, including the integrity of
the Group’s consolidated financial
statements, and compliance with
legal and regulatory requirements and
financial reporting standards, including
climate-related financial disclosures.
–Providing advice on whether the
Annual Report and Accounts, 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.
–Reviewing external financial reporting
and associated announcements,
including significant financial reporting
judgements contained in them.
Risk management and internal
control framework
–Overseeing the adequacy and
effectiveness of the internal
control framework.
–Reviewing and monitoring the
effectiveness of the risk management
procedures in place and the steps
being taken to mitigate the
Group’s risks.
External audit
–Making recommendations to the
Board on the appointment, removal,
remuneration and terms of engagement
of the external Auditor.
–Reviewing and assessing the external
Auditor’s independence and objectivity
taking into account relevant UK law
and professional and regulatory
requirements.
–Developing and implementing a formal
policy on non-audit services.
–Reviewing and approving the annual
audit plan and assessing the
effectiveness of the audit process.
Shatish Dasani
Chair of the Audit & Risk Committee
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SIG Annual Report and Accounts 2024
Risk & Assurance
–Monitoring and reviewing the
effectiveness of the Group’s
Risk & Assurance function.
–Reviewing and approving the annual
internal audit plan and monitoring its
effectiveness, including reviewing
timely implementation of management
actions on agreed control
recommendations.
Meetings and membership
The Committee meets regularly
throughout the year, with four meetings
being held during 2024. Key matters
considered at meetings of the
Committee are set out below.
The Board considers that each member
of the Committee was independent
throughout the year, and remains so,
and there are no circumstances which
are likely to impair their independence
according to the factors set out in the
Code or otherwise. The knowledge and
experience of the Committee members
means that the Committee is competent
in the sector in which the Group
operates. All Committee members have
a wide range of business experience
and expertise such that the Committee
can fulfil its responsibilities.
Shatish Dasani, as Chair of the
Committee, is a chartered accountant
and has recent and relevant financial
experience for the purposes of the
Code. For more information on the skills
and experience of each Committee
member see pages 70 to 71.
Attendance by individual members of
the Committee is disclosed in the table
on page 74. The Committee Chair
regularly invites senior management to
attend meetings of the Committee to
discuss or present specific items.
The CFO, Ian Ashton, and the CEO,
Gavin Slark, attended all of the
Committee meetings in 2024, as did the
Chairman of the Board. The external
Auditor, the Group Director of Audit and
Risk and the Group Financial Controller
also attended all meetings of the
Committee and have direct access
to the Committee Chair.
The Committee meets regularly with the
external Auditor and the Group Director
of Audit and Risk without the Executive
Directors being present, and the
Committee Chair also meets with the
external Auditor, the CFO, the Group
Financial Controller and the Group
Director of Audit and Risk in advance
of Committee meetings.
In accordance with the Relationship
Agreement with CD&R, Diego Straziota,
a Director nominated by CD&R,
attended as an observer all Committee
meetings held this year. As an observer,
Diego is entitled to attend meetings but
cannot affect the decision-making of
the Committee.
Highlights from the year
–Finance organisation review
–Review of the 2023 Annual Report and
Accounts, including key judgements,
the going concern basis of preparation
and viability statement
–Group risk register and principal risk
review, including deep dive of specific
and emerging risks
–Risk update and Annual Report
disclosure
–Review of 2024 half-year results
announcement
–Post-investment reviews
–Review of the revised UK Corporate
Governance Code 2024
–Biannual cyber security review
At every meeting the Committee
considers:
–Report of the CFO
–Report of the external Auditor
–Report of the Group Director of Audit
and Risk
–Minutes and actions from
previous meetings
The Committee also considered during
the year:
–Internal controls and the control
framework
–Senior Accounting Officer
annual review
–Annual external Auditor evaluation
–Report on Tax and Treasury matters
–Review and approval of non-audit
services from the external Auditor
–Committee performance review and
2024 actions
–Review of the effectiveness of the
Internal Audit function
–Review of the Committee terms
of reference
–Fraud risk assessment
–Customer credit risk
–ESG reporting and assurance
–Rationalisation of the Group’s
company structure
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The Committee in 2024
Significant financial judgements
The Committee considered a number of significant accounting matters during the year, related to areas requiring management
to exercise particular judgement or a high degree of estimation. These matters were discussed and reviewed with management
and the external Auditor and the Committee challenged judgements and sought clarification where necessary. The matters and
how they were addressed by the Committee are set out below:
Key financial reporting and significant financial judgements
considered in relation to the financial statements
How the issue was addressed by the Committee
Carrying value
of goodwill
and other
non-current
assets
The carrying value of goodwill and other
non-current assets is reviewed at the
mid-year point and at year end. The
Group estimates a recoverable amount
for each individual cash-generating unit
(‘CGU’) based on forecast revenues,
operating margins and discount rate
risk adjusted where appropriate.
For Benelux and UK Interiors the
recoverable amount is determined
based on fair value less costs of
disposal as this is higher than value
in use.
The results of the 2024 impairment review have been reviewed.
For the CGUs where the assessment is based on value in use,
as a result of the prevailing market conditions in 2024, the level
of headroom for a number of CGUs has reduced compared to
31 December 2023. The Committee considered the sensitivity
analysis performed, in particular the percentage change in the
key assumptions that would be required to lead the value in use
to equal carrying value. The percentage changes in revenue and
gross margin for the Miers and France Roofing CGUs, and the
percentage changes in revenue for the UK Specialist Markets
and Building Solutions CGUs are considered to be reasonably
possible scenarios given current uncertainties regarding market
demand and the forecast revenue growth included in the
forecasts, and the Committee has reviewed the disclosures
in the Consolidated financial statements in relation to this.
For the UK Interiors and Benelux CGUs, the Committee has
considered the assessment of recoverable amount based on
fair value less costs of disposal. The value of the property
right-of-use assets is supported by independent third party
valuations for a number of properties, based on the potential
rental income to be obtained from subletting. An impairment
of £7.3m has been recognised against fleet right-of-use assets
in UK Interiors, where there is no right of sublet or early
termination under current contractual terms. The Committee
is satisfied with the conclusions reached and the disclosures
in the Consolidated financial statements.
Recognition
and
measurement
of supplier
rebate income
Procedures and controls are in place to
ensure that the reporting, reviewing and
accounting for supplier rebate income is
properly managed and that supplier
rebates are recognised appropriately
in the Consolidated financial statements.
The Committee considered the adequacy of work performed in
the year to gain assurance that procedures and controls in
place were effective. This included the Committee considering
the controls in relation to the reporting, reviewing and accounting
for supplier rebates, and considered the level of supplier rebate
receivable balances at 31 December 2024 compared to the
supplier rebate income recognised, and has reviewed the
relevant disclosures in the Consolidated financial statements.
Disclosure of
Other items
The Group presents income statement
items in the middle column of the
Consolidated income statement, entitled
Other items, when they are significant in
size and nature, and either do not form
part of the trading activities of the Group
or where their separate presentation
enhances understanding of the financial
performance of the Group.
The Committee carefully considered the judgements made in
the separate disclosure of Other items. In particular, the
Committee sought to ensure that the treatment followed
consistent principles and that reporting in the Consolidated
financial statements is suitably clear and understandable.
Going concern
basis and
viability
statement
The Group is required to assess if
it has access to sufficient resources
to continue as a going concern and
assess the period of viability.
The Committee considered the review of going concern and
longer-term viability performed by management and reviewed
the financial statement disclosures. On the basis of the
financing the Group has in place and the Group’s latest financial
forecasts, the Committee is satisfied with the conclusions over
going concern and longer-term viability.
Further detail on the going concern assessment prepared
by the Group is included on page 59.
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Oversight of risk management
and internal controls
The Committee reviews and examines
the effectiveness of the Group’s risk
management and internal control
framework and advises the Board
in the exercise of its responsibility for
maintaining sound risk management
and internal control systems. The
Board has approved a set of policies,
procedures and frameworks for effective
internal control and risk management.
These procedures are subject to regular
review and provide an ongoing process
for identifying, evaluating, and managing
the significant risks faced by the Group.
Such a system is designed to manage,
rather than eliminate, the risk of failure
to achieve business objectives and
can provide only reasonable and not
absolute assurance against material
misstatements or loss.
Risk management
The Committee supports the Board in
its oversight of ensuring the integrity of
the Group’s financial reporting, internal
controls, risk management processes
and the relationship with the external
Auditor. On an annual basis the
Committee oversees the review of
the Group’s key strategic risks and
uncertainties. In performing this review,
the Committee seeks the opinions, and
takes into consideration the inputs, of
a broad range of SIG stakeholders.
This included the consideration of the
outputs of individual strategic risk
assessments, performed at each of our
operating companies, the insight and
views of the ELT and the outputs of
one-to-one meetings held between the
Group Director of Audit and Risk and
individual Board members and senior
management.
These risks are also subject to review on
a periodic basis whereby the Committee
considers the impacts of any changes
to SIG’s risk profile arising from updates
from the Group Director of Audit and
Risk on key issues in relation to the
Group’s risk management systems and
processes, the outputs of deep-dive risk
reviews, updates to individual operating
companies’ strategic risk registers
and issues identified through other
assurance activities completed across
the Group during the year.
Risk management roles and
responsibilities:
The Committee
–Has responsibility for reviewing and
examining the effectiveness of the risk
management and internal control
framework implemented by
management.
–Reviews and recommends the annual
strategic risk reporting process to the
Board for approval. On a periodic
basis, it reviews the status of key risks
and uncertainties, the effectiveness of
internal controls or other mitigations
implemented and trends and issues
arising from key risk indicators.
Executive Leadership Team
–Each ELT member is responsible for
reviewing, at least biannually, the
status of strategic risks and
uncertainties relevant to their
area of responsibility.
Operating company
Managing Directors
–Responsible for ensuring their
operating company has an appropriate
and proportionate risk management
process which captures, assesses and
prioritises business risks and identifies
appropriate mitigation strategies. This
process is reviewed and, if necessary,
updated, on a regular basis or when
changes in business activities or
external events are likely to have a
reasonable impact on the operating
company’s risk profile. Each operating
company’s Managing Director is also
responsible for formally approving and
signing-off their operating company’s
strategic risk report.
Group Director of Audit and Risk
–Provides advice and, where requested,
support to Group and operating
companies’ management to ensure
their completion of risk management
activities.
–Regularly reviews the output of
operating companies’ and Group
functions’ risk management activities
and processes in order to provide
reasonable assurance to the
Committee that appropriate internal
controls have been implemented
to mitigate the likelihood of risks
materialising and minimising potential
impacts arising.
–Works collaboratively with the
Committee, ELT and operating
company Managing Directors to
prepare an annual review of strategic
risks and uncertainties to ensure that
the nature and treatment of critical
risks and uncertainties (relative to
both the Group and each operating
company’s strategic plans) are
appropriately articulated, and that
appropriate mitigations are
implemented where necessary.
Internal control framework
The Group has adopted an assurance
framework which provides a structured
means to support the ongoing process
of identification, evaluation and
management of significant risks faced
by the Group. The aim of the framework
is to ensure that a single easily
explainable framework exists for all
aspects of control (financial and
non-financial), with individual elements
clearly defined and understood and a
clear linkage throughout the framework
from a branch to Board level. The
framework is the basis on which the
annual plan is built.
Some major activities performed as
part of the annual controls plan for
2024 were:
–Operating company controls reviews;
–France controls enhancement;
–Benelux controls programme;
–Key controls framework assessment;
and
–Monitoring actions and supporting
owners with remediation activities with
regular reporting to the Committee.
The Committee has responsibility
for reviewing the adequacy and
effectiveness of the Group’s internal
control framework. At each Committee
meeting, reports are provided on the
findings of the operating companies,
reviews conducted by the Group Head
of Internal Controls and Internal Audit,
investigations and management agreed
actions. The Committee receives regular
reports on progress and any issues
arising.
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Oversight of Internal Audit
The Group Internal Audit function
provides independent assurance to
senior management and the Board on
the adequacy and effectiveness of SIG’s
risk management and internal control
framework. Internal audit forms an
independent and objective assessment
as to whether risks have been
adequately identified, appropriate
internal controls are in place to
manage those risks, and whether
the controls are working effectively.
The Committee reviewed the remit,
organisation, and resources of the
function, together with the internal
audit plan. The internal audit plan was
regularly reviewed during the year to
ensure it remained aligned to the key
risks of the business and that the
function was appropriately resourced.
The Internal Audit function includes
French and Polish speakers as well as
English. External resources continue to
provide co-sourced support, when
necessary, to Group Internal Audit to
cover specialist areas.
Audit reports were presented to the
Committee with areas of weakness
resulting in action plans being
developed and follow-up reports
required to ensure that actions had
been completed acceptably.
Examples of internal audit reports
issued during the year include:
–UK Cash Management
–SIG UK Fleet Management
–SIG Germany Supplier Rebates
–SIG France property management
–SIG UK Finance Outsourcing review
Consistent with previous years, the
Committee agreed the process for the
evaluation of the performance of the
Group Internal Audit function which
involved the circulation of a questionnaire
tailored for several participating
stakeholder groups. The questionnaire
was sent to the Committee, Executive
Directors, Managing Directors and
Finance Directors of the operating
companies and the external Auditor.
Members of the Internal Audit team were
also asked to complete a questionnaire
by way of self-assessment.
The areas of focus for the Group Internal
Audit function for 2024 are set out below
together with a summary of how these
were addressed during the year:
1. Greater visibility of the
preparation process in
determining the annual audit
plan and discussion at Audit
& Risk Committee meetings.
Key areas of risk were discussed with
Board members as part of the year-
end principal risks and uncertainties
review process. The risks identified
were considered as part of the audit
planning process and formed the
basis of an indicative 2024 internal
audit plan presented to the
Committee in December, prior to
its final approval in February 2024.
2. Assess the quantity of audits
to be conducted during the
year and maintain focus on
ensuring audits have the right
level of resource and are
completed within the agreed
timeframe.
Regular updates regarding
performance of the audit plan and
any changes are communicated
regularly to the Board through formal
updates at each Committee meeting
and as part of the CFO’s regular
updates to the Board.
3. Explore the use of data
analytics to provide insight on
the control environment and
look at how to streamline the
control framework across
the operating companies.
The Group Internal Audit function
continued to utilise internal operating
company resource to interrogate data
using Power BI data visualisation
tools. Opportunities were assessed
to enhance data analytic capabilities
of audit processes, through
advanced data analytics software,
supported by an external provider, to
enable more effective reviews of data
sets containing large volumes of
structured and unstructured data.
4. Recruit additional European
language skills into the Internal
Audit function to ensure
efficiency of audits.
The Internal Audit function includes
native speakers of French and Polish,
as well as English. Other internal
resources and external providers are
utilised to assist with other languages
when this is required.
The evaluation for 2024 found that the
Group Internal Audit function adds
value, maintains its independence,
provides a broad range of assurance
and is effective overall.
The areas of focus for 2025 were agreed
by the Committee and include:
–Greater understanding of the risk
factors and prior findings used to
prepare the annual plan and
opportunity for the Committee to
review the plan earlier during the
planning process.
–Assess the quantity of audits to be
conducted during the year, aim to
complete audits within the agreed
timeframe to mitigate disruption to
the operating company and ensure
findings and remediation are
discussed, taking account of the
level of resource and costs.
–Explore the use of technology and
further embedding of data analytics
techniques to continue to develop the
effectiveness and efficiency of the
internal audit.
–Ongoing focus required to continue to
improve the timeliness of management
response to audit findings and drive
actions in line with the agreed timetable.
Oversight of external Auditor
The Committee is responsible for
maintaining the relationship with the
external Auditor on behalf of the Board.
The Committee ensures that the
external Auditor has full access to
Company employees and records. Ernst
& Young LLP were appointed as the
Group’s external Auditor in July 2018
following a tender. Shareholders formally
approved their reappointment at the
Annual General Meeting in May 2024.
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This financial year end is Ernst &
Young’s seventh year in office as
external Auditor. There is no intention
to conduct any retendering exercise
currently, but this will be reviewed
annually, taking into account the
performance and effectiveness of the
Auditor, as assessed by the Committee.
The Committee makes recommendations
to the Board in relation to the appointment,
reappointment and removal of the
external Auditor. The Committee
approves the external Auditor’s terms
of engagement and remuneration and
reviews the scope of the audit plan.
The Committee monitors the rotation
of the lead audit partner every five years
in accordance with the FRC’s Ethical
Standard. The current lead audit
partner, Mr Adrian Roberts, has
completed his second year as lead
audit partner.
How the Committee assessed the
audit quality and effectiveness
The Committee considers the
effectiveness of the external Auditor
regularly during the year, including its
independence, objectivity, appropriate
mindset and professional scepticism.
This is assessed through:
–Monitoring the external Auditor’s
progress against the agreed audit
plan, taking into consideration UK
professional and regulatory
requirements.
–Quality of the external Auditor’s
reports, communications and support
to the Committee.
–Robustness of the external Auditor’s
handling of significant financial
judgements.
–Interaction between management and
the external Auditor.
–Provision of non-audit services.
–Performance evaluation of the
external Auditor.
In October, the external Auditor provided
the Committee with their plan for
undertaking the year-end audit which
highlighted the proposed approach
and scope of the audit and identified
key areas of audit risk, including the
audit approach for these areas.
The Committee reviewed and,
where appropriate, challenged the
basis for the audit plan before agreeing
the proposed approach and scope of
the external audit.
The external Auditor prepared a report
of their audit findings at year end, which
they presented to the Committee. The
findings were reviewed and discussed in
detail by the Committee. The Committee
assessed the quality of the audit planning,
delivery and execution and the quality of
knowledge and service of the audit
team. The Committee assessed the
Auditor’s approach to providing auditor
services and concluded that the audit
team was providing the required quality
in relation to the provision of their
services, with appropriate rigour and
challenge, and had applied appropriate
professional scepticism throughout
the audit.
External Auditor performance
evaluation
For the year ended 31 December 2023,
the Group assessed the external
Auditor’s performance using a
questionnaire sent to key finance and
non-finance stakeholders across the
Group, a commentary-based survey
of Committee members and a review
of other published information on
audit quality.
The questionnaire was sent to the
Finance Directors of all in-scope
operating companies together with all
key members of the Group finance team
and others who had involvement with
the Auditor, including Tax and Treasury,
Company Secretariat, HR, Risk and
Internal Audit.
The questionnaire covered a range of
topics including the audit firm itself, the
partner role and involvement, the audit
team, audit planning and execution,
fees, communication and governance
and independence, with respondents
asked to rate the Auditor on a scale of
1 to 5 and to provide any additional
comments alongside their ratings.
Overall the ratings were substantially
similar to the ratings for the year ended
31 December 2022 across all areas.
There was a slight decrease in ratings
compared to 2022 mainly due to
Benelux being included in scope for
the Group audit for the first time and
changes in the finance team in France.
Overall most areas were rated highly
with a small number of exceptions
including most notably audit fees.
Results from the feedback process have
been shared with the external Auditor
and a number of actions taken to
address matters raised. The Committee,
having reviewed the performance and
effectiveness of the external Auditor,
was satisfied with the independence,
review and challenge, objectivity,
expertise, resources and general
effectiveness of Ernst & Young LLP and
satisfied that the Group is subject to a
rigorous audit process.
External Auditor independence
assessment
The Committee monitors the need
for the external Auditor to have an
appropriate degree of independence
and objectivity. The Committee invites
challenge by the external Auditor, giving
due consideration to points raised and
making changes to the financial
statements in response and where
appropriate. During the year, the
external Auditor demonstrated valuable
judgement, opinion, challenge
and debate.
The external Auditor reports to the
Committee each year on the actions
taken to comply with professional and
regulatory requirements and best
practice designed to ensure its
independence, including the rotation
of key members of the external audit
team. Ernst & Young LLP has formally
confirmed its independence to the
Committee in respect of the period
covered by these consolidated financial
statements.
Policy on non-audit services
The Group has a policy with regard
to the provision of audit and non-audit
services by the external Auditor,
which operated throughout 2024.
The policy is based on the principle that
the external Auditor should undertake
non-audit services only where they are
the most appropriate and cost-effective
provider of the service, and where the
provision of non-audit services does
not impair, and could not reasonably
be perceived to impair, the external
Auditor’s independence and objectivity.
It categorises such services as auditor-
permitted services, auditor-excluded
services and auditor-authorised
services. A number of services as
defined by the Committee, require
prior approval before the external
Auditors are engaged in connection
with such service.
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The fees permissible for non-audit
services should not exceed 70% of the
average audit fees paid to the Group’s
external Auditor in the last three
consecutive financial years. The policy
was reviewed during 2024 and is
reviewed annually. It defines the types
of services falling under each category
and sets out the criteria to be met and
the internal approvals required prior to
the commencement of any auditor-
authorised services. In all cases, any
instruction must be pre-approved by the
CFO and the Committee Chair before
the external Auditor is engaged. The
external Auditor cannot be engaged
to perform any assignment where the
output is then subject to their review
as external Auditor.
The Committee regularly reviews an
analysis of all services provided by the
external Auditor. The policy and the
external Auditor’s fees are reviewed
and set annually by the Committee
and are approved by the Board.
The total fees payable by the Group
to its external Auditor for non-audit
services in 2024 were £0.4m, primarily
the interim review (2023: £0.2m) and
assurance services in connection with
the refinancing completed this year
(2023: £nil). The total fees payable to
the external Auditor for audit services
in respect of the same period were
£2.6m (2023: £2.5m). Current year costs
include £nil in relation to the 2023 audit
(2023: £nil in relation to the 2022 audit).
The ratio of audit to non-audit fees was
6.5:1 in respect of the audit for the
current year. Details of each non-audit
service and reasons for using the
Group’s external Auditor are provided in
Note 3 to the Consolidated financial
statements on page 149.
A full breakdown of external Auditor
fees is disclosed in Note 3 to the
Consolidated financial statements on
page 149.
Resolution to reappoint
external Auditor
The Committee recommends, and the
Board agrees, that a resolution for the
reappointment of Ernst & Young LLP
as Auditor of the Company for a further
year will be proposed at the 2025
Annual General Meeting.
Fair, balanced and
understandable
The Board had the opportunity to review
early drafts of the Annual Report and
Accounts and provided input.
Following this, the Committee has
reviewed the contents of this year’s
Annual Report and Accounts and
advised the Board that, in its view, the
Annual Report and Accounts, taken
as a whole, is fair, balanced and
understandable and provides the
necessary information to enable
shareholders to assess the position
and performance, strategy and business
model of the Group.
In reaching this conclusion the Committee
has considered the following:
–the preparation of the Annual Report is
a collaborative process between the
Finance, Investor Relations &
Communications, Legal, Company
Secretariat, and Human Resources
functions within the Group, ensuring
the appropriate professional input to
each section. External guidance and
advice is sought where appropriate;
–the coordination and project
management is undertaken by a
central team to ensure consistency
and completeness of the document;
–an extensive review process is
undertaken, both internally and
using external advisors;
–a report is prepared internally to
assess the Annual Report and how
it addresses the fair, balanced and
understandable assertion; and
–a final draft is reviewed by the
Committee members prior to
consideration by the Board.
Terms of reference
During the year the Board reviewed the
terms of reference of the Committee and
made a number of non-material updates
to them. These can be found on the
Group’s website at www.sigplc.com.
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Committee performance review
An internal performance review of the Committee was conducted for 2024 and further details can be found on page 83.
The recommendations from the Committee’s 2023 performance review are set out below together with a summary of the
progress that was made to satisfy the recommendations during the year:
2023 recommendations
Action taken during 2024
Monitor the quality and
performance of Finance
leadership teams
The Committee received and reviewed a report from the Chief Financial Officer regarding
the Finance leadership teams at Group and at operating company level. The Committee
also considered the feedback from the Directors who attend the operating review meetings
regarding their direct experience of the operating company Finance Directors. The Committee’s
conclusion was that the Finance leadership across SIG is of a consistently high standard.
Maintain focus on
overseeing the completion
of management agreed
actions (MAAs) from audits
A process is in place to follow up and report on the progress of MAAs within the CFO
report. The report of the Director of Risk and Audit to each meeting of the Committee
contains a section describing the outstanding MAAs.
Continue the monitoring of
risk topics and the reviewing
of measures being taken to
mitigate risks
The Committee conducted deep-dive reviews of several risk topics during the year which
included reviewing the current and any proposed additional mitigation measures proposed
by management. Cyber risk was presented on two occasions during the year with other risk
topics considered including fraud and Benelux internal controls.
The priorities that the Committee has established for 2025 include:
– Continue monitoring key and emerging risks faced by the business, including that created by the tough trading situation.
–Continue to oversee effectiveness of the Finance function across the Group.
–Maintain focus on integrity of financial information and control standards.
–Oversee implementation of new reporting and governance requirements so as to ensure a balanced approach.
Shatish Dasani
Chair of the Audit & Risk Committee
4 March 2025
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Risk management
and internal control
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The Board has ultimate responsibility for
establishing and maintaining an effective
risk management and internal control
framework and determining the nature
and extent of the principal risks the
Group is willing to take in order to
achieve its long-term strategic
objectives. The Board delegates
responsibility to the Audit & Risk
Committee to consider the adequacy
of the risk management and internal
control framework, to agree the
risk-based internal audit programme
and to ensure the risk management
and internal control structure and
frameworks are robust.
The ELT has responsibility for ensuring
that risk management is embedded into
all processes and for ensuring that risk
profile is in line with the approved risk
appetite. Local controls managers
support process owners to develop
controls and to ensure appropriate
control design effectiveness is in place.
Group Internal Audit is then responsible
for ensuring appropriate operational
effectiveness of controls and assurance
is provided through a cyclical programme
of control effectiveness reviews. Internal
Audit also provides regular assurance
regarding the quality of the risk
management processes, developing a
risk-based internal audit programme and
providing independent assurance to the
Board and the Audit & Risk Committee
that the controls in place are designed
appropriately and operating effectively.
The Group Internal Audit function
comprises an in-house team supported
by external resources, where necessary,
to assist in providing assurance on
specialist areas. The Audit & Risk
Committee on behalf of the Board
regularly reviews the need for the
Group Internal Audit function and its
effectiveness in providing regular
assurance.
Information on the activities of the Audit
& Risk Committee during the year can
be found on pages 88 to 95.
Key elements of ongoing
process for risk management
and internal control
The Group Internal Audit function
periodically reviews local risk
management arrangements in order to
provide reasonable assurance to both
the Audit & Risk Committee and the
Board that appropriate internal controls
have been implemented to mitigate the
likelihood of risks materialising and
effectively minimising potential impacts
arising. In addition, on at least an annual
basis, the Group Director of Audit and
Risk meets with the operating company
leadership teams to perform a detailed
review of their key strategic risks and
uncertainties, which is used as an input
to the annual Group strategic risk review.
The key elements of the existing
systems for risk management and
internal control, in accordance with the
FRC’s Guidance on Risk Management
and Internal Control and Related
Financial and Business Reporting
(September 2014), are as follows:
Risk management
–The documented Group risk
management framework, approved by
the Audit & Risk Committee, provides
an overview of the agreed risk
management processes within the
Group and gives practical guidance to
operating companies and individual
functions on the management of risk.
–In accordance with the Group risk
management framework, the Group
Director of Audit and Risk works with
the operating companies and central
function leadership teams to ensure
appropriate local risk registers are
maintained.
–The Board maintains an overall Group
risk register, the content of which is
reviewed and assessed at least twice a
year by the Board and includes regular
input from the Audit & Risk Committee.
A review of the Group’s principal risks
and how it manages or mitigates them
is presented in the Strategic report on
pages 62 to 67.
–The Group risk register has been
reviewed and updated and contains
the principal risks faced by the Group,
assessing the potential risk having
taken into account likelihood, impact
and the current controls to mitigate an
identified risk and any further actions
required to bring the risk to within risk
appetite. Once identified, emerging
risks are assessed by identifying and
mapping out the core elements of the
risk, identifying owners for each
element in the operating companies,
holding workshops or conducting
audits with risk owners to assess the
level of risk, identifying potential
mitigating actions that reduce the
impact of the risk and seeking external
guidance if required. Potential
emerging risks are monitored and
assessed regularly during the year
by the Audit & Risk Committee for
their relevance and significance.
The Audit & Risk Committee regularly
assesses the Group’s emerging and
principal risks and considers that its
assessment is robust. The Audit & Risk
Committee reports to the Board
following its assessments. A consolidated
Group strategic risk report was
prepared for review by the ELT and
was recommended to the Board for
approval in early 2025.
Internal control
The Group assurance framework
is the basis on which our operating
companies’ internal controls functions,
the Group Controls function and the
Group Internal Audit teams base their
annual plan. The controls plan for 2024
was defined, communicated and agreed
with operating companies, and the
teams made progress on the delivery of
the plan. The teams support the
creation and maintenance of a robust
financial control environment, and they
raise controls awareness across SIG by
providing operating companies and
Group functions with practical and
hands-on support and advice. Group
Internal Audit proposed and delivered a
rolling audit plan for 2024 across the
Group, together with a branch audit
programme. Regular updates
were provided through the year.
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Key control activities include:
–operating company controls reviews:
in order to continue to build up
controls documentation across core
financial processes within the
operating companies, the 2024 plan
contained a number of controls
reviews. The objective of controls
reviews is to support the operating
companies in enhancing their control
environments and to build the Risk
and Control Matrices (‘RACMs’) and
process map documentation;
–entity-level controls: a high-level
comparison against the COSO Internal
Control Framework was performed to
assess SIG’s processes around culture
and values, governance, monitoring,
and Board oversight. COSO is an
internationally recognised framework
used to establish internal controls to
be integrated into business processes.
The processes in place ensure the
tone from the top is set appropriately
through the code of conduct
communication, key Group policies
and procedures, and ongoing training;
–Key Control Framework (‘KCF’)
submissions: on a quarterly basis
operating companies are required to
self-certify against 32 areas covering
financial controls, entity-level controls,
operational controls and IT General
Controls. The Group Controls function
performs a review of the responses
received to ensure consistency of
responses compared to other sources
of assurance, as well as to identify
significant issues or control
weaknesses;
–action remediation and tracking: the
Group Controls function documents
and monitors progress on all
remediation actions arising from
controls work. Monthly updates are
obtained from operating companies,
which are analysed, investigated and
reported to the ELT and the Audit &
Risk Committee;
–during 2024 the Group Internal Audit
team also performed reviews of control
effectiveness of RACMs relating to
purchase-to-pay and supplier rebates
across our UK, Poland and Germany
operating companies. Further RACM
reviews were also undertaken in the
UK operating company in the areas of
customer rebates and order-to-cash
processes.
–the Group Delegation of Authority
policy was refreshed and approved by
the Board in January 2024 and it was
communicated to the operating
companies and Group functions during
the year;
–training and guidance: to raise the
awareness of controls across the
business, the Group Controls function
delivered a series of training modules
and guidance covering control topics
relevant to operating companies
and the Group;
–UK Corporate Reform update:
the Group Controls function has
considered the Government’s decision
not to press ahead with the legislation
in this area together with the FRC’s
decision to only make limited changes
to the Corporate Governance Code
introduced from January 2025. The
SIG controls programme since 2021
has been built to ensure readiness
for any potential future legislative
developments. These activities, which
focus on formalising, documenting,
remediating and evidencing controls as
well as training stakeholders, remain
valid given the current regulatory
requirements. The Government’s
decision provides greater flexibility
than would have been the case and
the team continues to assess the
controls programme to ensure it
remains suitable for the Group.
–as part of the sanctions policy adopted
in 2022, Internal Audit regularly
screens the top 20 product suppliers
for each operating company and other
strategic suppliers, and no compliance
exceptions were noted;
–to help assess and prioritise
investments in IT infrastructure,
applications and services, the Internal
Audit team continues to review and
assess IT capabilities based on an
industry standard process assessment
methodology. During 2024, the
business continuity capability at the
Group’s Polish business was reviewed,
assessing the quality of project
control implemented to support the
implementation of a new ERP system.
Financial reporting
–In addition to the general internal
controls and risk management
processes described on pages 62
to 67, the Group also has specific
systems and controls to govern the
financial reporting process and
preparation of the Annual Report
and Accounts.
–These systems include clear policies
and the procedures for ensuring
that the Group’s financial reporting
processes and the preparation of
its financial statements comply with
all relevant reporting requirements.
–Group accounting policies are
comprehensively detailed in the Group
accounting policy manual, which all
businesses are required to comply
with in the preparation of their results.
–Financial reporting control
requirements are set out in relevant
RACMs, which have been reviewed
and updated during the current year.
Annual assessment of the
effectiveness of risk management
and internal control systems
The Board assessed the effectiveness of
the Group’s system of risk management
and internal controls. This assessment
covered all controls including operational,
compliance and risk management
procedures, as well as financial controls.
The Board considers that the
information that it receives is sufficient
to enable it to review the effectiveness
of the Group’s risk management and
internal controls in accordance with the
FRC’s guidance. The Board considers
that the framework of controls in place
is effective and enables risk to be
assessed and managed. The Board
also considers its risk management
and internal control processes provide
it with the assurance that all the
necessary resources are in place for
the Group to meet its objectives and to
measure performance against them for
2024 and up to and including the date of
this report.
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Directors’
remuneration report
Committee Members
Kath Durrant
Alan Lovell
Andrew Allner
Bruno Deschamps
Gillian Kent
Shatish Dasani
Simon King
Chair’s statement
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Annual report on remuneration
112
Dear Shareholder,
On behalf of the Remuneration
Committee, I am pleased to present the
Directors’ remuneration report for 2024.
As in previous years, the Annual report
on remuneration and this annual
statement are subject to an advisory
vote at the 2025 AGM.
The Committee was appreciative of the
high level of shareholder approval at
the 2024 AGM for the 2023 Directors’
remuneration report, which received
96.6% of votes in favour of the
resolution.
Role and responsibilities
To provide effective governance over the
integrity of the Group’s remuneration
arrangements for executive and senior
management and to ensure they are
aligned to the interests of the
Company’s shareholders.
The key role of the Committee is to
assist the Board in discharging its
responsibilities for:
–Reviewing the broad remuneration
policy for senior management;
–Recommending and monitoring the
level and structure of remuneration
for senior management;
–Governing all share plans; and
–Reviewing any major changes in
employee remuneration and benefit
structures throughout the Group.
Remuneration Policy
The Committee considers that the
current Policy continues to appropriately
support our remuneration principles,
which are designed to:
–Attract and retain the best talent;
–Encourage behaviours that support
delivery of the Group’s strategy and
business objectives, which are
developed in the long-term interests of
the Company and its shareholders;
–Incentivise employees to deliver our
business goals together by rewarding
individual and team contribution and
performance; and
–Ensure that a significant percentage of
the overall remuneration package of
the Executive Directors and senior
management remains at risk,
dependent on performance, and that
their pay and benefits adequately take
account of reward versus risk.
The suitability of the Policy is monitored
by the Committee to ensure that it
meets these principles.
Performance in 2024
As set out in further detail in the Strategic
Report, in 2024 we experienced a
prolonged period of challenging trading
conditions, most notably in UK Interiors,
France and Germany. However, all the
businesses performed well relative to
their markets, most notably Germany
and UK Roofing.
The Group has reported an underlying
operating profit of £25m at an operating
margin of 1.0%, with effective cost
actions mitigating in part the impact of
lower sales from the weaker markets.
However, this was below the
expectations we had at the beginning of
the year, and this is reflected in the lower
than target bonus payments for the
Executive Directors and Executive
Leadership Team. The Group reported a
statutory loss before tax, after interest
and Other items, of £45m.
All businesses continued to show
disciplined cash management against
the headwinds of lower profit, with FY24
net debt of £497m post-IFRS 16 leases.
The lower than expected sales and profit
during the year were partially offset by
reduction in trade working capital.
Kath Durrant
Chair of Remuneration Committee
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Group performance
Metric
2024
2023
Revenue
£2,611.8m
£2,761.2m
Like-for-like sales growth
(4)%
(2)%
Gross margin
24.5%
25.3%
Underlying operating profit
£25.1m
£53.1m
Average trade working capital to sales ratio
13.9%
14.3%
Underlying operating margin
1.0%
1.9%
In 2024, we took further actions to
reduce our permanent cost base to
support profitability, and made progress
against our continuing strategic
initiatives as set out on pages 20 to 23.
The Group continued to make good
progress on sustainability. For 2024, all
members of the Executive Leadership
Team had robust and stretching
objectives that contain ESG measures,
which make up 20% of the annual
bonus measures. To take one example
of progress made, GHG emissions per
£m of revenue decreased to 16.9 metric
tonnes from 17.1 metric tonnes in 2023.
We have continued to maintain good
employee engagement and our people
continued to show good commitment
during 2024. Employee engagement in
2024 was maintained at the same level
as 2023 at 71%. Customer NPS
delivered a score of +51 compared to
+50 in 2023 and employee NPS was at
+9 vs +14 in 2023.
These results remained positive overall,
whilst also reflecting some expected
impact from the challenging market
environment and the restructuring
and headcount reductions made to
manage cost.
At SIG, we believe that all employees,
customers and suppliers should
be able to work in a safely managed
environment, and our Executive and
Senior leaders are incentivised through
the annual bonus scheme on evidence
of a positive health and safety culture. In
2024, the lost time injury frequency rate
(LTIFR) has reduced to 8.0 from 8.4 in
2023, as a result of a continued focus
on our health and safety strategy and
the associated activities during the year.
Turning to the individual performance of
the CEO and CFO, clear objectives were
set at the start of the year and agreed
with the Committee. The Group’s
performance management system
supported the Committee’s consideration
of personal performance. More detail
can be found on pages 113 and 114.
Corporate governance and
remuneration
The Committee sets high standards in
corporate governance, and during the
year the Committee:
–Approved 2023 annual bonus
outcomes for the Executive Directors
and Executive Leadership Team,
taking into consideration business
performance, stakeholder interests,
Health and Safety performance, and
achievement against individual
strategic objectives;
–Approved the grant of Restricted Share
Awards to 64 individuals, including the
Executive Directors, under the terms
of the SIG plc 2020 Restricted
Share Plan;
–Approved the vesting of the March
and October 2021 Restricted Share
Awards and approved in principle
the March 2022 award vesting;
–Received data, information and
analysis on all employee terms and
conditions of employment across the
Group and used this information in
making executive remuneration
decisions;
–Reviewed the effectiveness of the
advice received from Korn Ferry in
supporting the Committee. The
Committee is satisfied with the
high-quality support and advice
it receives from Korn Ferry;
–Approved funding for the independently
managed Employee Benefit Trust
(“EBT”) to buy shares in the market;
and
–Formally reviewed an analysis of the
underpin and windfall tests that apply
to the outstanding Restricted Share
Plan (‘RSP’) awards.
An internal evaluation of the Committee
was conducted for 2024 and further
details can be found on page 119.
Salary increases
Throughout our businesses we have
implemented an annual salary review.
The Committee, with the Executive
Directors agreed that the pay for the
CEO and CFO would not increase for
2025. The UK workforce received an
average increase of 2%. The Committee
also determined that the Chairman and
Non-Executive Director fees would not
increase for 2025. Annual salary reviews
in France, Germany, Poland and Ireland
take place between January and April,
with average increases ranging from
1.5% and 7%. The annual salary reviews
in our Benelux operation are subject to a
collective labour agreement.
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Annual bonus outcomes for 2024
In reviewing the overall remuneration
outcomes, the Committee ensured
they were reflective of the business
performance and the experience of
our stakeholders.
In assessing this, the Committee
reflected on the overall level of bonus
that the achievement against the targets
generated relative to overall corporate
performance. The outcome was the
exercise of downwards discretion,
reducing the strategic element by a third
to 10% out of 20%. The resulting level of
bonus was 13.9% of the maximum for
the year.
Annual bonus design for 2025
Financial measures will represent 90%
of the overall opportunity with the
remainder reflecting strategic objectives.
Underlying operating profit will continue
as the measure of profit representing a
60% weighting, with cash-based
measures having a 30% weighting.
The weighting on individual strategic
objectives is being halved to 10% to
enable a greater focus on the key
financial measures.
Two-thirds of the cash weighting will
be on average Group working capital
divided by sales, with the remaining
one-third on Group free cash flow. An
ESG measure will again be included in
individual strategic objectives for the
Executive Directors and Executive
Leadership Team.
RSP awards
Under the terms of the 2020 Restricted
Share Plan, awards granted in March
2022 will vest on 14 March 2025.
The Committee have considered the
underpinning factors and assessed
whether a windfall gain may have been
created and concluded that neither the
underpinning factors nor the windfall
gain test gave rise to scaling back of
any award.
The Committee intends to make awards
in 2025 of 125% of salary to the CEO
and 100% of salary to the CFO, subject
to a similar underpin.
Focus for the year ahead
The objectives that the Committee has
established for 2025 include:
–Evaluate incentive arrangements and
ensure those in place support the
timely delivery of the Group strategy
balancing short and longer-term
requirements
–Review and operate the annual bonus
plans and RSP to ensure they deliver
performance against the set targets/
underpins
–Ensure that talent is appropriately
incentivised, and that SIG remains
able to attract and retain the right
capabilities
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–Appraise incentives containing ESG
measures; and
–Review updates received from the
Chief People Officer regarding
developments in workforce reward,
incentive, and benefit structures
including a focus on Branch
Management.
Looking forward, the Committee
remains focused on supporting the
Group to achieve its strategic objectives
and continuing to operate with rigour
and transparency.
I hope you find this report clear and
useful in explaining our approach to
remuneration. If you have any questions
on the policy or the report, please
contact me through the Group General
Counsel & Company Secretary.
Kath Durrant
Chair of the Remuneration Committee
4 March 2025
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Annual bonus
Measures
Link to strategy
Link to
KPls
Underlying operating profit
Focus on growth in sales and returns
Key measure of organic growth
Linked to shareholder value
Working capital
Free cash flow
Focus on operational efficiency
Focus on sustainable investment
Linked to shareholder value
Strategic objectives
Strategic objectives and targets for the bonus are commercially sensitive and will be
disclosed retrospectively
Health and safety override
Focus on safe working environments, evidenced by positive health and safety culture
including visible leadership, sufficient resources, effective reporting and follow-up,
employee feedback, and improvements in metrics
RSP
Measures
Link to strategy
Link to
KPls
General underpin
Focus on long-term sustainable performance, including our sustainability objectives
Allows both individual and Group performance considerations such as the level of
employee and customer engagement to be taken into account
Shareholding guidelines
Linked to shareholder value
How do our incentives align to our strategy?
Our business strategy is aimed on improving the Group’s medium-term financial performance to achieve a 5% operating
margin, enhancing value for shareholders and all other stakeholders. As set out in our remuneration policy, the RSP operates
a general underpin on business performance, allowing the Committee to review holistically the overall performance of the Group,
individual performance, and wider Group considerations. In addition, we continually consider the performance measures we use
for the annual bonus incentives to ensure they support the delivery of our strategy.
Our medium-term strategic pillars
Execute
Strengthen
execution and
margin across
geographies
Modernise
Specialise
Accelerate in
specialist, higher
return businesses
Grow
Continue
above-market
growth
2
1
3
4
Greater
productivity
through
modernisation
Our vision
To be the best provider of specialist construction
and insulation products in Europe.
Our key performance indicators
Like-for-like
sales
Gross margin
Operating
margin
Average trade
working capital
to sales ratio
LTIFR
NPS
GHG
emissions per
£m of revenue
eNPS
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The UK Corporate Governance Code (the ‘Code’) requires the Committee to determine the policy and practices for Executive
Directors in line with a number of factors set out in Provision 40. The following table sets out how the remuneration policy aligns
with the Code.
Provision 40 element
How the remuneration policy aligns
Clarity – remuneration arrangements
should be transparent and promote
effective engagement with stakeholders
and the workforce.
The annual bonus plan performance conditions are based on the core KPIs of the
strategy and therefore there is a clear link to all stakeholders between their delivery
and reward provided to management. There is a logical flow of similar KPIs in the
incentive schemes that apply to different parts of the workforce.
Engagement of Remuneration Committee members with the workforce on a wide
range of topics including remuneration takes place.
Simplicity – remuneration structures
should avoid complexity and be
easy to understand.
The performance conditions for the annual bonus plan are based on the
Group’s KPIs.
To ensure simplicity, reward is aligned with the delivery of the key markers that
indicate the successful implementation of strategy.
Restricted shares are a simple mechanism and avoid the setting of long-term
performance conditions which tend to make remuneration inherently more complex.
Risk – remuneration arrangements
should avoid reputational and other
risks from excessive rewards, and
behavioural risks that can arise from
target-based incentive plans.
The remuneration policy includes:
–setting defined limits on the maximum awards which can be earned;
–requiring the deferral of a substantial proportion of the incentives in shares for
a material period of time;
–aligning the performance conditions with the strategy of the Group;
–ensuring a focus on long-term sustainable performance through the RSP; and
–ensuring there is sufficient flexibility to adjust payments through malus and
clawback and an overriding discretion to depart from formulaic outcomes.
These elements mitigate against the risk of target-based incentives by:
–limiting the maximum value that can be earned;
–deferring the value in shares for the long-term, which helps ensure that the
performance earning the award was sustainable and thereby discourages
short‑term behaviours;
–aligning any reward to the agreed strategy of the Group;
–supporting a focus on the sustainability of the performance over the longer term
through the use of an RSP;
–reducing the awards or cancelling them if the behaviours giving rise to the awards
are inappropriate; and
–reducing the awards or cancelling them, if it appears that the criteria on which the
award was based do not reflect the underlying performance of the Group.
Predictability – the range of possible
values of rewards to individual directors
and any other limits or discretions
should be identified and explained at
the time of approving the policy.
The remuneration policy sets out clearly the range of values, limits and discretions in
respect of the remuneration of management.
The RSP increases the predictability of the rewards received by management.
Proportionality – the link between
individual awards, the delivery of
strategy and the long-term performance
of the Group should be clear.
Outcomes should not reward poor
performance.
The remuneration policy sets out clearly the range of values and discretions in
respect of the remuneration of management. In a competitive market for quality
leaders the Group pays sufficiently to attract, incentivise and retain.
The primary value of an RSP discounted vs a traditional LTIP is in share price
appreciation over time and is therefore aligned with the development of a sustainable
business and shareholder value.
Alignment to culture – incentive
schemes should drive behaviours
consistent with Group purpose,
behaviours and strategy.
The annual bonus plan drives behaviours consistent with SIG’s strategy and there is
a logical flow of similar KPIs through the incentive schemes that apply to the workforce.
The RSP drives behaviours consistent with the Group’s purpose and values which
are focused on the long-term future of the business.
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Wider workforce considerations
and remuneration
The Committee considers the wider
workforce when making pay decisions
and it reviews employee policies and
practices to ensure reward and
incentives are aligned with SIG’s
strategy, vision and culture.
In addition to the Executive Directors,
its remit extends to senior management
teams operating across all countries
within the Group, and to ensuring that
their annual bonus plans and share
incentive plans align with those of the
Executive Directors, creating a shared
strategic focus. The Committee believes
that it is important to be transparent with
how decisions on reward are made and
this section seeks to provide context to
our Director pay by providing information
on whether our approach to executive
remuneration is consistent with the
wider workforce.
Delivery of our strategy depends on
attracting and retaining an engaged
workforce that has the right skills
and behaviours to make a valuable
contribution to our business. The
Remuneration Committee ensures that
appropriate engagement takes place
with employees to explain how executive
remuneration aligns with SIG’s approach
to wider Group pay. During the year
the Committee undertook a review of
workforce terms and conditions and
engaged directly with employees
through listening sessions hosted by
the Designated Non-Executive Director
for Workforce Engagement to solicit
employee views and sentiment,
including discussions focused on
executive remuneration and corporate
governance led by the Group Head of
Reward. Additionally, a review of the
Group-wide employee engagement
survey was undertaken by the Board to
ensure that employee sentiment was
understood and considered as part of
their decision-making.
Engagement with shareholders
We have received views from key
shareholders on remuneration and the
application of the policy, and we are
grateful for their feedback.
Key elements of remuneration
The Committee reviews all key elements
of remuneration across the Group
annually. The levels and types of
remuneration vary across the Group
depending on the employee’s level of
seniority, country of operation and role.
The Group operates a broad range of
benefits including an all-employee Share
Incentive Plan (‘SIP’) in the UK.
It is important to highlight that the
Committee is not looking for a
homogeneous approach across the
Group. However, when conducting its
review, it pays particular attention to:
–Whether the element of remuneration
is consistent with the Group
remuneration principles (see above);
–If there are differences, they are
objectively justifiable; and
–If the approach seems fair and
equitable in the context of other
employees.
Remuneration principles
Our remuneration principles remain relevant and are designed to support and reinforce our culture and behaviours.
They provide a best practice framework for the design, implementation and operation of Group and local reward policies
and practices and apply across the Group.
In action
Alignment and fairness
–Clear and appropriate governance structures are in place for decision making at all levels.
–Remuneration programmes and processes are run fairly, with integrity and are supported
with clear communication to individuals.
–Pay arrangements are fair and equitable across the Group.
Rewarding contribution
and performance
–Bonus plans are designed for the Executives and all other employees to incentivise sustainable
profitable growth and cash generation.
–Incentive plans reward the delivery of our business strategy, targets are appropriately
stretching, and objectives are focused on value creation.
–Performance measures are reviewed regularly, personal and strategic objectives are accurately
assessed, and targets are set relative to strategic priorities.
–Health and safety is a feature of all management and executive plans.
Transparency and
participation
–There is a focus on effectively communicating remuneration decisions through
stakeholder engagement.
–Incentive and benefits plans are clear, simple and understood by participants
to maximise engagement.
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A summary of the employee remuneration structure and how it compares to the remuneration of the Executive Directors is below:
Pay element
Employees
Executive Directors
Salary
We conduct an annual pay review for all
employees. In setting the budget, many
factors are considered, such as market rates,
economic context, business performance
and affordability.
In 2024, the average UK employee base salary
increase was 3.75%.
Salary increases are considered in the context of
the wider workforce review and performance of
the Group.
A salary increase of 3% was awarded to the CEO
and CFO in 2024.
Pensions and benefits
We offer market-aligned benefits packages
reflecting normal practice in each country in
which we operate. Where appropriate, we offer
benefit choices to our employees.
Pension contributions are no higher than those
provided to UK employees.
Benefits are aligned to the senior leadership
team in the country of operation.
Bonus plan
Over 92% of our workforce participate in a cash
bonus scheme. The level and performance
targets differ depending on the role and
country of operation.
CEO annual bonus of up to 150% of base salary,
CFO annual bonus of up to 125% of base salary.
One-third of the total amount payable in shares,
and the remaining two-thirds payable in cash.
RSP
62 senior leaders participated in the RSP in
2024, with a range of annual awards between
10% and 80% of salary. A holding period does
not apply below the Executive Director level.
Maximum annual award of 125% of salary;
three-year vesting period with underpin on
vesting; and a two-year holding period.
An award of 125% of salary was made to the
CEO, and an award of 100% of salary was made
to the CFO in 2024.
SIP
All UK employees are invited to participate in
the SIP.
Executive Directors are invited to participate in
the SIP.
In summary, the Committee is satisfied that the approach to remuneration across the Group is consistent with the Group’s
principles of remuneration. Further, in the Committee’s opinion the approach to executive remuneration aligns with the wider
Group pay policy, and there are no anomalies specific to the Executive Directors.
Summary of the application of the remuneration policy
We have set out in the following table how the remuneration policy operated in 2024. The full remuneration policy is detailed in
the policy section of this annual report.
The Group’s policy is to provide remuneration packages that fairly reward the Executive Directors for the contribution they make
to the business and that are appropriately competitive to attract, retain and motivate Executive Directors and senior managers
of the right calibre. A significant proportion of remuneration takes the form of variable pay, which is linked to the achievement
of specific and stretching targets that align with the creation of shareholder value and the Group’s strategic goals.
In order to avoid any conflict of interest, remuneration is managed through well-defined processes ensuring no individual is
involved in the decision-making process related to their own remuneration. In particular, the remuneration of all Executive
Directors is set and approved by the Committee; none of the Executive Directors are involved in the determination of their
own remuneration arrangements.
The Committee also receives support from external advisors and evaluates the support provided by these advisors annually
to ensure that advice is independent, appropriate and cost-effective.
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Element and link to strategy
How we implemented the policy in 2024
How we will implement the policy in 2025
Base salary
Provides a base level of remuneration to
support recruitment and retention of
Executive Directors with the necessary
experience and expertise to deliver the
Group’s strategy.
Executive Director salaries for 2024
were as follows:
–CEO – £695,250
–CFO – £424,000
The general UK employee base salary
increase was 3.75%.
Executive Director salaries for 2025 will
remain at:
–CEO – £695,250
–CFO – £424,000
The general employee base salary
increase in the UK was 2%.
Pension
Provides a fair level of pension provision
for all employees.
The Executive Directors received a
pension allowance of 5% of salary. This
is 2.5% of salary below the workforce
rate and what is permissible under
the policy.
No change.
Benefits
Provides a market standard level
of benefits.
The benefits received were as follows:
–Car allowance
–Private medical insurance
–Group income protection
–Group life assurance
No change.
Annual bonus
The annual bonus plan provides a
significant incentive to the Executive
Directors linked to achievement in
delivering goals that are closely aligned
with the Group’s strategy and the
creation of value for shareholders.
Bonus operation:
–one-third of any bonus earned is
deferred in shares for three years.
Maximum opportunity in 2024 was
as follows:
–CEO – 150% of base salary
–CFO – 125% of base salary
Any bonus is subject to a health and
safety override, where the Committee
will review the health and safety
performance of the Group for the
year in question.
See page 113 for bonus outcomes
for 2024.
No change.
The health and safety override will
continue to operate in 2025.
The performance measures for 2025 are
underlying operating profit (60%), free
cash flow (10%), average Group working
capital divided by annual sales (20%)
and strategic objectives (10%).
The Committee does not disclose the
bonus targets in advance due to
commercial sensitivity over budgeted
future profit and debt levels.
The Committee will, however, provide
full retrospective disclosure to enable
shareholders to judge the level of award
against the targets set.
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Element and link to strategy
How we implemented the policy in 2024
How we will implement the policy in 2025
RSP
Awards are designed to incentivise the
Executive Directors over the longer
term to successfully implement the
Group’s strategy.
RSP operation:
–maximum annual award up to 125% of
salary based on the market value at
the date of grant;
–awards vest at the end of a three-year
period subject to:
· continued employment to the date
of vesting;
· the satisfaction of an underpin
(whereby the Committee can adjust
vesting for business, individual and
wider Group performance). Further
details of the underpin test are
included in the remuneration policy
section; and
· a two-year holding period will
then apply.
RSP awards granted in 2024 were
as follows:
–CEO – 125% of base salary
–CFO – 100% of base salary
The Committee regularly reviews Group
and individual performance against the
underpin and considers whether a
windfall was felt to be made for all
outstanding awards each year.
No change.
Share ownership requirements
The Group has established the principle
of requiring Executive Directors to build
up and maintain a beneficial holding of
shares in the Company. It is expected
that this should be achieved within
five years of the relevant Executive
Director’s appointment. Adherence
to these guidelines is a condition of
continued participation in the share
incentive arrangements. Executive
Directors will be required to retain
100% of the post-tax amount of vested
shares until the minimum shareholding
requirement is met and maintained.
Share ownership requirements:
–CEO – 300% of base salary
–CFO – 300% of base salary
This applies for two years post-
cessation, or the actual shareholding
on cessation if lower.
No change.
Chairman and Non-Executive Directors’ fees
Provides a level of fees to support
recruitment and retention of a Chair and
Non-Executive Directors with the
necessary experience to advise and
assist with establishing and monitoring
the Group’s strategic objectives.
Fees for 2024 were increased by 3%,
which was below the general workforce
increase for the UK.
Fees for 2024 were as follows:
–Chairman – £240,776
–Non-Executive Directors’ fee – £67,193
–Senior Independent Director – £10,000
–Designated Non-Executive Director for
Workforce Engagement – £10,000
–Remuneration Committee Chair –
£12,000
–Audit & Risk Committee Chair –
£12,000
Fees were reviewed in December 2024
and it was agreed that in line with the
Executive Directors the fees would not
increase for 2025.
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Directors’ remuneration policy
This section of the report sets out a summary of the Company’s remuneration policy for Executive and Non-Executive Directors,
which was approved by shareholders at the Annual General Meeting on 4 May 2023. The remuneration policy is intended to
operate for up to three years. The full remuneration policy can be found in the 2022 Annual Reports and Accounts.
Directors’ remuneration policy table
Element and
link to strategy
Operation
Maximum
Performance conditions
and recovery provisions
Salary
Provides a base level of
remuneration to support
recruitment of Executive
Directors with the
necessary experience and
expertise to deliver the
Group’s strategy.
An Executive Director’s basic
salary is set on appointment
and reviewed annually or when
there is a change in position or
responsibility.
When determining an
appropriate level of salary,
the Committee considers:
–pay increases for other
employees;
–remuneration practices
within the Group;
–any change in scope, role
and responsibilities;
–the general performance of
the Group and each
individual;
–the experience of the
relevant Director; and the
economic environment.
Individuals who join the Board
may, on occasion, have their
salaries set below the targeted
policy level until they become
established in their role. In
such cases subsequent
increases in salary may be
higher than the general rises
for employees until the target
positioning is achieved.
The Committee ensures
that maximum salary levels
are positioned in line with
companies of a similar size
or sector to SIG and
validated against an
appropriate comparator
group, so that they are
competitive against
the market.
The Committee intends to
review the comparators
each year and will add or
remove companies from
the groups as it considers
appropriate.
In general, salary increases
for Executive Directors will
be in line with the increase
for employees. However,
larger increases may be
offered if there is a material
change in the size and
responsibilities of the role
(which covers significant
changes in Group size
and/or complexity).
A broad assessment of individual
and business performance is used
as part of the salary review.
No recovery provisions apply.
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Element and
link to strategy
Operation
Maximum
Performance conditions
and recovery provisions
Pension
Provides a fair level of
pension provision for
all employees.
The Group provides a pension
contribution allowance that is
fair, competitive and in line
with corporate governance
best practice.
Pension contributions will be
a non-consolidated allowance
and will not impact any
incentive calculations.
The maximum value of
the pension contribution
allowance for Executive
Directors will be aligned to
that available to the majority
of the UK workforce.
No performance or recovery
provisions apply.
Benefits
Provides a market
standard level of benefits.
Benefits include market
standard benefits. The
Committee recognises the
need to maintain suitable
flexibility in the benefits
provided to ensure it is able
to support its objective of
attracting and retaining
personnel in order to
deliver the Group strategy.
Additional benefits which are
available to other employees
(including any all-employee
plans) on broadly similar terms
may therefore be offered, such
as relocation allowances on
recruitment.
The maximum is the cost
of providing the relevant
benefits and in the case of
all-employee plans, in line
with HMRC approved limits.
No performance or recovery
provisions applicable.
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Element and
link to strategy
Operation
Maximum
Performance conditions
and recovery provisions
Annual bonus plan
The annual bonus plan
provides a significant
incentive to the Executive
Directors linked to
achievement in delivering
goals that are closely
aligned with the Group’s
strategy and the creation
of value for shareholders.
In particular, the annual
bonus plan supports the
Group’s objectives,
allowing the setting of
targets for the year based
on the Group’s strategic
objectives at that time,
meaning that a wider
range of performance
metrics can be used that
are relevant and
achievable.
The Committee will determine
the maximum annual
participation in the annual
bonus plan for each year,
which will not exceed 150%
of salary.
Details of the performance
conditions, targets and their
level of satisfaction for the year
being reported on will be set
out in the Annual report on
remuneration.
In extreme circumstances as
determined by the Committee,
targets may be established for
periods of less than a full year,
for example six months. At the
end of the period, targets will
be reviewed and adjusted for
the remainder of the year.
The Committee can determine
that part of the bonus earned
under the annual bonus plan
is provided as an award of
deferred shares.
One-third of any bonus earned
is deferred in shares.
The Committee may determine
that a greater portion or in
some cases the entire bonus
be paid in deferred shares. The
main terms of these deferred
share awards are:
–minimum deferral period
of three years; and
–the participant’s continued
employment at the end of the
deferral period unless he/she
is a good leaver.
The Committee may award
dividend equivalents on
deferred bonus awards to
the extent that these vest.
The Committee will
determine the maximum
annual participation in the
annual bonus plan for each
year, which will not exceed
150% of salary.
Percentage of bonus
maximum earned for levels
of performance:
–threshold up to 25%
–target 50%
–maximum 100%
The annual bonus plan is based on
a mix of financial and strategic/
operational conditions. Measures
will normally be set across one
financial year and shall be measured
accordingly. The financial measures
will account for no less than 50% of
the bonus opportunity.
The Committee retains discretion in
exceptional circumstances to
change performance measures and
targets and the weightings attached
to performance measures part-way
through a performance year if there
is a significant and material event
which causes the Committee to
believe the original measures,
weightings and targets are no
longer appropriate.
Discretion may also be exercised
where the Committee believes that
the bonus outcome is not a fair and
accurate reflection of business,
individual and wider Group
performance. The exercise of this
discretion may result in a downward
or upward movement in the amount
of bonus earned resulting from the
application of the performance
measures.
Any adjustments or discretion
applied by the Committee will be
fully disclosed in the following year’s
Directors’ remuneration report.
The Committee is of the opinion
that given the commercial
sensitivity arising in relation to
the detailed financial targets used
for the annual bonus, disclosing
precise targets for the annual bonus
plan in advance would not be in
shareholder interests. Actual
targets, performance achieved, and
awards made will be published in
the Directors’ remuneration report
at the end of the performance
periods, so shareholders can fully
assess the basis for any payouts
under the annual bonus. The annual
bonus plan contains malus and
clawback provisions.
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Element and
link to strategy
Operation
Maximum
Performance conditions
and recovery provisions
RSP
Awards are designed to
incentivise the Executive
Directors over the longer
term to successfully
implement the Group’s
strategy.
Awards are granted annually to
Executive Directors in the form
of conditional awards or options.
Awards vest at the end of a
three-year period subject to:
–the Executive Director’s
continued employment at
the date of vesting; and
–the satisfaction of an
underpin as determined by
the Committee whereby the
Committee can adjust vesting
for business, individual and
wider Group performance.
A two-year holding period will
apply following the three-year
vesting period for all awards
granted to the Executive
Directors.
Upon vesting, sufficient shares
may be sold to pay tax on
the shares.
The Committee may award
dividend equivalents on RSP
awards to the extent that
these vest.
Maximum value of 125% of
salary per annum based on
the market value at the date
of grant in accordance with
the rules of the RSP.
There are no performance
conditions on grant,
however the Committee
will consider prior year
business and personal
performance to determine
whether the level of grant
remains appropriate.
No specific performance conditions
are required for the vesting of RSP
awards but there will be an
underpin as the Committee will
have the discretion to adjust vesting
taking into account business,
individual and wider company
performance.
The Committee considers the
following factors (amongst others)
when exercising its discretion
to adjust the number of shares
vesting:
–whether threshold performance
levels have been achieved for the
performance conditions for the
annual bonus plan for each of the
three years covered by the vesting
period for the restricted shares;
–whether there have been any
sanctions or fines issued by a
regulatory body;
–participant responsibility may be
allocated collectively or
individually;
–any material damage to the
reputation of the Group;
–the potential for windfall gains;
–whether there has been sufficient
progress against the sustainability
plan approved by the Board; and
–the level of employee and
customer engagement over
the period.
Awards are subject to clawback
and malus provisions.
Corporate governance report continued
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Remuneration
Directors’ remuneration report continued
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SIG Annual Report and Accounts 2024
Shareholding requirement
The Committee has in place strong shareholding requirements of 300% of base salary that encourage Executive Directors to
build up their holdings over a five-year period. Adherence to these guidelines is a condition of continued participation in the
share incentive arrangements.
Executive Directors are required to retain 100% of the post-tax amount of vested shares from the Company incentive plans until
the minimum shareholding requirement is met and maintained. There is a post-cessation shareholding requirement aligned to
the full in-employment requirement (or the Executive Director’s actual shareholding on cessation if lower) for two years following
cessation of employment.
Non-Executive Directors’ remuneration policy table
Chair & Non-Executive
Director fees
Operation
Maximum
Performance conditions
and recovery provisions
Provides a level of fees to
support recruitment and
retention of a Chair and
Non-Executive Directors with
the necessary experience to
advise and assist with
establishing and monitoring
the Group’s strategic
objectives.
The Board is responsible for
setting the remuneration of
the Non-Executive Directors.
The Committee is responsible
for setting the Chair’s fees.
Non-Executive Directors are
paid an annual basic fee and
additional fees for chairing of
committees. The Group
retains the flexibility to pay
fees for the membership of
committees. The Chair does
not receive any additional fees
for membership of committees.
Further, additional fees may
be paid by the Group to the
Chair and Non-Executive
Directors for additional time
commitments or roles outside
the normal scope of their
appointments.
Fees are reviewed annually
based on equivalent roles in
the comparator group used to
review salaries paid to the
Executive Directors.
Non-Executive Directors and
the Chair do not participate in
any variable remuneration or
benefits arrangements.
The fees for Non-Executive
Directors and the Chair are
broadly set at a competitive
level against the comparator
group.
In general, the level of
fee increase for the Non-
Executive Directors and the
Chair will be set taking
account of any change in
responsibility and will take
into account the general rise
in salaries across the UK
workforce.
The Group will pay reasonable
expenses incurred by the
Non-Executive Directors and
Chair and may settle any tax
incurred in relation to these.
No performance or recovery
provisions applicable.
111
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SIG Annual Report and Accounts 2024
The following section provides details of how SIG’s remuneration policy was implemented
during the financial year ended 31 December 2024.
This part of the report has been prepared in accordance with the Companies Act, various companies regulations, and
relevant sections of the Listing Rules. The Annual report on remuneration and the Chair’s statement will be put to an advisory
shareholder vote at the 2025 AGM. The information on pages 112 to 118 has been audited where required under
the regulations and indicated as such.
Single total figure of remuneration for Executive Directors (audited)
The table below sets out the single total figure of remuneration received by each Executive Director for the year ended
31 December 2024 and the prior year.
Executive Director
Base
salary1
£’000
Taxable
benefits 2
£’000
Annual
bonus3
£’000
LTIP
£’000
Pension4
£’000
Other
£’000
Total
remuneration
£’000
Total fixed
remuneration
£’000
Total
variable
remuneration
£’000
Gavin Slark
2024
695
11
145
0
35
0
886
741
145
2023
619
16
208
0
31
0
874
666
208
Ian Ashton
2024
424
20
74
2815
21
0
820
465
355
2023
412
23
108
6326
21
0
1,196
456
740
The figures in the table above have been calculated as follows:
1. Base salary: amount earned for the year as Directors and rounded.
2. Taxable benefits: include, but are not limited to, car allowance/company car, private medical insurance and income protection. Group Life Assurance has been
removed from the 2024 calculations (2023= £3k for Gavin Slark and £2k for Ian Ashton).
3. Annual bonus: payment for performance during the year (including any deferred portion).
4. Pension: the Company’s pension contribution during the year of 5% of salary.
5. The value for the RSP represents the award vesting on 14 March 2025 and has been based on the three-month average to 31 December 2024 of 20.09p. As the
award will not vest before the publication of the 2024 annual results and the value at vesting will not be known, this estimated value will be restated next year when
the actual execution price at vesting is known. Based on the one-month average of the share price to 28 February 2025 the amount would be circa £185k, which
gives a better view of the likely value on vesting. The award is not subject to performance conditions but is subject to an underpin applicable during the three-year
vesting period.
6. The value for the RSP represents the awards that vested on 1 December 2023 and 29 March 2024, based on executed prices of 28.725p and 27.95p respectively.
The March 2024 award vested after publication of the 2023 Annual Report, and the value was estimated and included in that report using an estimated price, namely
the three-month average to 31 December 2023 of 30.59p. As a result the total award for 2023 has been restated from £658k in the 2023 Annual Report to the £632k
shown above.
7. There has been no payments for loss of office and payments to past Directors.
Single total figure of remuneration for Non-Executive Directors (audited)
The table below sets out the single total figure of remuneration received by each Non-Executive Director for services rendered
to the Group as a Non-Executive Director for the year ended 31 December 2024 and the prior year.
Base fee
Committee Chair/Senior
Independent Director fees
Total fees
2024
£’000
2023
£’000
2024
£’000
2023
£’000
2024
£’000
2023
£’000
Andrew Allner (Chairman)
241
234
—
—
241
234
Alan Lovell1
67
65
—
7
67
72
Bruno Deschamps2
67
65
—
—
67
65
Gillian Kent
67
65
—
—
67
65
Kath Durrant 3
67
65
22
15
89
80
Shatish Dasani
67
65
12
12
79
77
Simon King
67
65
10
10
77
75
Diego Straziota2,4
67
43
—
—
67
43
1. Alan Lovell stood down as Senior Independent Director on 25 September 2023 and his fees for 2023 reflect the reduction in remuneration earned from that date.
2. The fees paid to Bruno Deschamps and Diego Straziota are not retained by them individually but paid to CD&R.
3. Kath Durrant was appointed as Senior Independent Director on 25 September 2023 and her fees for 2023 reflect the additional remuneration earned from that date.
4. Diego Straziota was appointed as a Non-Executive Director on 4 May 2023 and his fees for 2023 reflect remuneration earned from that date.
Corporate governance report continued
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Annual report on
remuneration
112
SIG Annual Report and Accounts 2024
2024 bonus out-turn
The maximum potential bonus opportunity for Gavin Slark (CEO) was 150% of salary and for Ian Ashton (CFO) was 125%
of salary. The table below sets out the targets and level of achievement that were considered when determining the bonus.
The Committee also considered the targets that would apply to the Executive Leadership Team for 2024, which were based
on operating profit, average working capital and free cash flow.
Performance condition (weighting)
Actual
Threshold
Interim
Maximum
Outcome
CEO Actual
£’000
CFO Actual
£’000
Operating profit (60%)1
25%
50%
100%
0%
0
0
£25m
£48.0m
£55.2m
£61.2m
Average working capital2 (10%)
25%
50%
100%
39%
41
21
13.9%
14.3%
13.6%
12.9%
Free cash flow3 (10%)
25%
50%
100%
0%
0
0
£(32.1)m
£(29.6)m
£(23.7)m
£(17.8)m
Strategic objectives (20%)
See below
pay-out level
50%
104
53
Total4
145
74
1. Group underlying operating profit, adjusted for M&A during the year. No M&A transactions were made in 2024.
2. Average working capital – average of month end trade balances divided by annual sales.
3. Free cash flow – all cash flows excluding M&A transactions, dividend payments and financing transactions.
4. The Committee reviewed health and safety leadership and performance and determined that there was no requirement to exercise its override discretions.
Chief Executive Officer
Bonusable Objectives
Measures
Outcome
Operational Excellence
Drive short-term operational and cash
performance, ensuring that issues are
identified and mitigating actions are taken.
Markets continued to be weak across 2024
requiring ongoing execution of significiant
restructuring activities throughout the year to
mitigate the market effect.
UK Interiors turnaround
Assure turnaround plans are in place for UK
Interiors business, including leadership and
incentives, and consideration of strategic
options.
Turnaround plan and leadership incentives in
place with opex cost reduction achieved and
critical new hire secured in the year.
Strategy and
Performance
Ensure detailed and granular plans and
milestones are prepared for each operating
company to achieve its medium-term
margin target.
Each Opco has a mid-term plan in place as
presented to the Board. In addition, the
refinancing process was successfully
completed earlier than planned in a
challenging market environment.
Modernisation
Significant progress and real momentum in
modernising the business including the use
of digitisation, AI, and technology.
Across the business, key modernisation and
upgrade activities were completed in all Opcos
ranging from e-commerce to CRM and ERP
projects.
ESG/People
Support the execution of the talent agenda
to ensure SIG has in place the right level of
leadership, engaged talent and robust
succession planning.
Organisation Capability & Talent Reviews were
completed measuring talent and succession
bench strength improvements and progress
on organisation readiness to achieve business
goals.
The Committee evaluated the performance of the CEO against the above outcomes and scored this part of the bonus at 15%
out of the 20% available for these strategic objectives. However, reflecting on the overall level of bonus that this would generate,
considering the overall corporate performance for the year, the Committee exercised downwards discretion on the strategic
elements, reducing the payout on these to 10% out of 20%.
113
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Financials
SIG Annual Report and Accounts 2024
Chief Financial Officer
Bonusable Objectives
Measures
Outcome
Business Performance
Pathway to 5% operating margin in place for
medium-term, and ensure plans in place
across all businesses.
Drive short-term operational and cash
performance, including meaningful mitigations
in the event of continued market weakness.
Ongoing market weakness in 2024 delayed
planned progress to 5% operating margin.
Material cost savings executed to mitigate
market weakness and build more efficient
platform for medium-term.
Corporate Development
& Investor Relations
Rigorously assess M&A and other
development opportunities. Create expanded
pipeline of new equity investors.
Whilst certain opportunities were reviewed, no
mergers or acquisitions were pursued during
the year. Ongoing work undertaken to ensure
positive engagement of investors.
People
Continued development of key Finance talent
and function capability.
Actions to develop key talent and enhance
function’s capability progressed well.
Balance Sheet
Execute the optimal refinancing for the Group,
or ensure clear plans in place for early 2025.
Refinancing process completed successfully
and earlier than originally planned, despite
challenging market backdrop.
ESG
Ensure 2024 milestones met against the
Group’s roadmap for delivery of
emissions targets.
Key milestones progressed as agreed in the
year, and trade-offs with financial performance
well managed.
The Committee evaluated the performance of the CFO against the above outcomes and scored this part of the bonus at 15%
out of the 20% available for these strategic objectives. However, reflecting on the overall level of bonus that this would generate,
considering the overall corporate performance for the year, the Committee exercised downwards discretion on the strategic
elements, reducing the payout on these to 10% out of 20%
Restricted share plan awards vesting in March 2025
Awards granted under the RSP on 14 March 2022 are due to vest shortly after the date of publication of this document.
As part of its final assessment of the underpin, the following factors have been considered:
–whether threshold performance levels have been achieved for the performance conditions for the Bonus Plan for each of the
three years covered by the vesting period for the RSP award;
–whether there have been any sanctions or fines issued by a Regulatory Body; (in which case participant responsibility may be
allocated collectively or individually);
–whether there has been material damage to the reputation of the Company; (in which case participant responsibility may be
allocated collectively or individually);
–the level of employee and customer engagement over the period; and
–in all cases subject to the Committee’s holistic assessment at vesting based on business performance, individual performance
or wider Company considerations.
In relation to the operation of the underpins, the Remuneration Committee’s intention is not to reduce the value of the awards
unless there are clear and specific failures to achieve the underpins. The failure to achieve the threshold performance measure
in any one year is not, in itself a reason to reduce the value of the award.
The Committee is comfortable the requirements under the underpin have been met and the awards will vest in full.
2024 restricted share plan awards
Gavin Slark and Ian Ashton were granted RSP awards of 125% and 100% of salary, respectively on 21 March 2024. No consideration
was paid for the grant of the awards which are structured as nil-cost options. The number of ordinary shares over which RSP
awards were granted was based on an ordinary share price of 29.96 pence per share, which was 75% of the price used for the
previous year’s grant.
The normal vesting date of the awards will be 21 March 2027, being the third anniversary of the award date. The awards will
ordinarily vest after three years subject to continued service and a discretionary underpin that allows the Remuneration
Committee to make adjustments to the level of vesting if it believes due to business performance, individual performance or
wider Group considerations that the vesting should be adjusted. This will include consideration of all relevant factors, including
any windfall gains. Once vested, the awards will normally be exercisable until the day before the tenth anniversary of the award
date. The awards are subject to a two-year holding period commencing on vesting.
Corporate governance report continued
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114
SIG Annual Report and Accounts 2024
Executive Director
Date of grant
% of award for
minimum
performance
Shares
subject to
award
Face value at
date of award
Gavin Slark
21 March 2024
100
2,900,742
£869,062
Ian Ashton
21 March 2024
100
1,415,206
£423,996
Directors’ interests in SIG shares (audited)
The interests of the Directors in office during the year ended 31 December 2024, and their families, in the ordinary shares of the
Company at the dates below were as follows:
Shares held
Nil-cost options held
Owned
outright or
vested
Vested but
subject to
holding period
Vested but
not exercised
Unvested
subject to
vesting and
holding period
Unvested and
subject to
deferral
Shareholding
required
(% basic
salary) 1
Current
shareholding
as a % of
basic salary 2
Requirement
met 2
Gavin Slark3
890,000
—
—
5,246,885
—
300%
87%
No
Ian Ashton 4
166,666
1,209,209
—
4,472,707
—
300%
146%
No
Andrew Allner
288,384
—
—
—
—
—
—
—
Kath Durrant
100,774
—
—
—
—
—
—
—
Gillian Kent
Nil
—
—
—
—
—
—
—
Alan Lovell
330,000
—
—
—
—
—
—
—
Bruno Deschamps
Nil
—
—
—
—
—
—
—
Simon King
166,666
—
—
—
—
—
—
—
Shatish Dasani
320,000
—
—
—
—
—
—
—
Diego Straziota
Nil
—
—
—
—
—
—
—
1. This relates to the in-employment shareholding requirement. Executive Directors are expected to achieve target shareholdings within five years of appointment. In the
event of cessation, Executive Directors are expected to hold the lower of this shareholding requirement and their actual holding on cessation.
2. Gavin Slark and Ian Ashton’s holdings are based on SIG share price of 16.48p as at 31 December 2024. The post-tax value of the RSP awards granted in March 2022,
March 2023 and March 2024 have been included in the current shareholding figure. The % shareholding will fluctuate due to share price movements at each year-end.
3. Gavin Slark was appointed as CEO on 1 February 2023.
4. Ian Ashton was appointed as CFO on 1 July 2020. Ian Ashton exercised 1,056,089 share options during the year and the pre-tax gain on exercise was £296,304
(2023: £359,063).
There have been no changes to shareholdings between 1 January 2025 and the date of this report.
Total Shareholder Return (“TSR”)
The graph below shows the Group’s TSR performance (share price plus dividends paid) compared with the performance of the
FTSE All Share Industrial Support Services Index over the ten-year period to 31 December 2024. This index has been selected
because the Group believes that the constituent companies comprising the FTSE All Share Industrial Support Services Index
are the most appropriate for this comparison as they are affected by similar commercial and economic factors to SIG.
Ten Year Company TSR Performance v FTSE All Share Industrial Support Services
SIG
FTSE All Share Industrial Support Services
250
200
150
100
50
0
2022
2014
2015
2016
2017
2018
2019
2020
2021
2023
2024
197.4
11.3
Rebased TSR from 31 December 2014
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Financials
SIG Annual Report and Accounts 2024
CEO pay in the last ten years
The table below shows how pay for the CEO role has changed in the last ten years.
Year
2015
£’000
2016
£’000
2016
£’000
2017
£’000
2017
£’000
2018
£’000
2019
£’000
2020
£’000
2020
£’000
2021
£’000
2022
£’000
2023
£’000
2023
£’000
2024
£’000
Incumbent
Stuart
Mitchell
Stuart
Mitchell 2
Mel
Ewell3
Mel
Ewell
Meinie
Oldersma4
Meinie
Oldersma
Meinie
Oldersma
Meinie
Oldersma5
Steve
Francis 6
Steve
Francis
Steve
Francis
Steve
Francis 7
Gavin
Slark8
Gavin
Slark
Single figure of
remuneration
765
581
100
150
794
669
688
258
850
1,315
1,435
876
874
886
% of max
annual bonus
earned
01
n/a
n/a
n/a
70
0
0
0
57
87
96.5
22.1
22.5
13.9
% of max LTIP
awards vesting
19.5
n/a
n/a
n/a
n/a
n/a
0
n/a
n/a
n/a
n/a
100
n/a
n/a
1. Stuart Mitchell took the decision to waive his entitlement to the 2015 annual bonus.
2. Stuart Mitchell stepped down as CEO with effect from 11 November 2016, and his remuneration relates to the period served. He did not receive a bonus for 2016,
and his outstanding LTIP awards lapsed.
3. Mel Ewell was appointed as Interim CEO with effect from 11 November 2016 and stepped down on 31 March 2017. He continued as an Executive Director until
20 April 2017, and his remuneration relates to the period served as CEO. Mel Ewell did not participate in any Group incentive schemes.
4. Meinie Oldersma was appointed CEO on 3 April 2017. The 2017 figure pertains to the period 3 April 2017 to 31 December 2017.
5. Meinie Oldersma stepped down as CEO with effect from 24 February 2020, and his remuneration relates to the period served. He did not receive a bonus for 2020,
and his outstanding LTIP awards lapsed.
6. Steve Francis was appointed CEO on 25 February 2020. The 2020 figure pertains to the period 25 February 2020 to 31 December 2020. His single figure reflects the
temporary 20% salary reduction between 1 April 2020 and 30 June 2020 as a result of the Covid-19 pandemic as well as the one-off bonus arrangement received for 2020.
7. Steve Francis stepped down from his role as CEO on 1 February 2023, and his remuneration relates to the period he served. As per his settlement agreement, he
received a pro-rata bonus for 2023 and his outstanding RSP awards were also pro-rated.
8. Gavin Slark was appointed CEO on 1 February 2023. The 2023 figure pertains to the period 1 February to 31 December 2023.
Percentage change in Directors’ remuneration
The Executive Directors are the only employees of SIG plc on the Board. The table below shows the annual percentage change
in salary/fees, benefits and bonus between 2024 and 2023, 2023 and 2022, 2022 and 2021 of the Directors of the Group
compared to the average for all other UK-based employees. The year-on-year analysis prior to this is not presented as the
comparatives were not meaningful: Ian Ashton joined the Company during 2020 and did not serve a whole year in office during
that year.
% change 2024 v 2023
% change 2023 v 2022
% change 2022 v 2021
Salary/fees
Benefits
Bonus
Salary/fees
Benefits
Bonus
Salary/fees
Benefits
Bonus
Gavin Slark (CEO)1
12.4
(31.2)
(30.5)
—
—
—
—
—
—
Ian Ashton (CFO)
3
(13.3)
(31.8)
5
2
(77)
3
0.6
12.4
Andrew Allner
(Chairman)
3
—
—
4
—
—
3
—
—
Shatish Dasani2
2.5
—
—
3
—
—
11.8
—
—
Bruno Deschamps
3
—
—
4
—
—
3
—
—
Kath Durrant2
11.6
—
—
7
—
—
3
—
—
Gillian Kent
3
—
—
4
—
—
3
—
—
Simon King2
2.6
—
—
3
—
—
19.4
—
—
Alan Lovell2
(7.4)
—
—
(0.25)
—
—
3
—
—
Diego Straziota3
56.4
—
—
—
—
—
—
—
—
Average % increase
for employees
3.6
1.0
(4.0)
6.7
0
(41.1)
5.6
(5.6)
(18.3)
1. Gavin Slark received 3% increase in his base salary and was remunerated for the full year.
2. 3% increase in fees with a change to duties.
3. Diego Straziota received 3% increase in his fees and was remunerated for the full year.
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SIG Annual Report and Accounts 2024
CEO pay ratio
Financial year
Method used
25th percentile
pay ratio
50th percentile
pay ratio
75th percentile
pay ratio
2024
Option B (Gender Pay Data)
30:1
26:1
18:1
2023
Option B (Gender Pay Data)
66:1
49:1
39:1
2022
Option B (Gender Pay Data)
46:1
42:1
27:1
2021
Option B (Gender Pay Data)
53:1
45:1
31:1
2020
Option B (Gender Pay data)
44:1
38:1
31:1
2019
Option B (Gender Pay data)
32:1
28:1
20:1
For 2024, the Company has used Option B given the availability of data, in order that a direct comparison can be shown against
last year. Gender Pay for 2024 has been calculated in line with the guidance and details of the data used in the analysis can be
found in the Gender Pay Gap Report which was published on our website (www.sigplc.com) in late March 2024.
In determining the quartile figures, one UK employee with the relevant hourly rate was chosen for each quartile and the single
total remuneration figure was calculated for them to compare to the CEO.
The Group feels that using Gender Pay Data ensures that these individuals are reasonably representative of pay levels at the
25th, 50th and 75th percentile as the single total remuneration figure for these individuals is similar to other employees with a
similar annual salary.
2024
2023
CEO
25th
50th
75th
CEO
25th
50th
75th
Basic salary
695,250
28,319
28,227
42,538
665,795
23,387
32,812
40,090
Benefits
11,278
0
0
819
18,433
0
0
0
Pension
34,762
693
2,300
3,337
33,290
1,754
2,574
3,145
Bonus plan
144,960
500
3,285
1,276
224,359
1,200
0
1,876
LTIP
0
0
0
0
809,263
0
0
0
Total pay
886,250
29,512
34,052
47,970
1,751,140
26,341
35,386
45,111
CEO pay for 2024 has been calculated for the period 1 January 2024 to 31 December 2024 based on the single total figure of
remuneration table.
The following elements have been used to calculate the single total figure of remuneration for the employee at each quartile;
base salary, bonus, employer pension contribution, car/car allowance, private medical insurance, Group income protection, and
employer share incentive plan contribution. No pay elements were omitted or adjusted to calculate CEO pay. Non-guaranteed
overtime was omitted for employees due to its variable nature.
The reduction in the CEO pay ratio for 2024 versus the previous year is largely driven by the fact the current CEO, appointed
February 2023, did not have share awards vest during 2024, whilst the former CEO, who stood down in February 2023, had
awards vest under SIG plc’s 2020 Restricted Share Plan in December 2023 and March 2024, which were included in the CEO
pay for the calculation of the 2023 pay ratio. We expect the CEO pay ratio to show less movement in future years until the first
vesting of the current CEO’s RSP awards in March 2026.
To ensure pay is managed appropriately at all levels in the organisation, we regularly review our salaries against those of similar
roles in both the wider market and our sector. We also undertake additional pay analysis, such as gender pay reporting, to
ensure we can identify, and, if appropriate, address any pay issues that arise. The ratio is driven by the differences in the
structure of the pay of our CEO, which is made up of a higher proportion of variable pay, versus that of our wider workforce
employees. This reflects the diverse range of roles and skillsets required to effectively operate our organisation; from the
operational employees in our distribution centres, to, for example, specialist technical roles in our IT departments. What is
important from our perspective is that this ratio is influenced only by the differences in structure, and not by divergence in fixed
pay between the CEO and wider workforce.
117
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Governance
Financials
SIG Annual Report and Accounts 2024
Relative importance of the spend on pay
The table below shows the percentage change in total employee pay expenditure and shareholder distribution (i.e. dividends
and share buybacks) from the financial year ended 31 December 2023 to the financial year ended 31 December 2024.
2024
£m
2023
£m
% Change
Distribution to shareholders
—
—
—
Employee remuneration1
327.02
342.4
(4.5)%
1. Continuing operations employee remuneration.
2. In addition to the above, redundancy and related staff costs of £6.5m (2023: £6.7m) have been included within Other items (Note 2), including £nil (2023: £0.4m)
share-based payment expense.
The Company has declared that no final dividend would be paid for 2024 and no interim dividend was paid in 2024 (2023: nil).
Service contracts and letters of appointments
The Committee’s policy for setting notice periods is that normally they will be a maximum of 12 months. The Non-Executive
Directors of the Company do not have service contracts. The Non-Executive Directors are appointed by letters of appointment.
Each independent Non-Executive Director’s term of office runs for a three-year period.
The details of the service contracts currently in place are as follows:
Executive Directors
Name
Date of contract
Company notice
Executive notice
Guaranteed payments on
change of control or cessation
Gavin Slark
1 February 2023
12 months
12 months
None
Ian Ashton
1 July 2020
6 months
6 months
None
Terms of appointment of the Non-Executive Directors
Name
Date of appointment
Date of most recent term
Date of expiry
Alan Lovell
1 August 2018
13 May 2024
12 May 2027
Andrew Allner
1 November 2017
1 November 2023
31 October 2026
Bruno Deschamps
10 July 2020
10 July 2023
9 July 2026
Diego Straziota
4 May 2023
4 May 2023
3 May 2026
Gillian Kent
1 July 2019
12 May 2022
11 May 2025
Kath Durrant
1 January 2021
1 January 2024
31 December 2026
Shatish Dasani
1 February 2021
1 February 2024
31 January 2027
Simon King
1 July 2020
1 July 2023
30 June 2026
Advisors to the Remuneration Committee
External
To ensure that the Group’s remuneration practices are in line with best practice, the Committee appointed independent external
remuneration advisors, Korn Ferry, through a competitive tender process in 2021. Korn Ferry confirms that it has no connection
with the Company or its individual directors.
The Committee sought advice from Korn Ferry in relation to various matters including emerging market practices in executive
and wider workforce incentive design and peer group analysis.
Korn Ferry is a member of the Remuneration Consultants Group and adheres to its Code of Conduct in its dealings with the
Committee. The Committee has reviewed, and is satisfied that, the advice received during 2024 was independent and robust.
The fees for the advice provided by Korn Ferry in 2024 were £66,968 (2023: £90,250) and were based on the time spent during
the year.
Internal
The Committee also sought internal support from the CEO, CFO, Chief People Officer, Group Head of Reward, and the
Company Secretary, at Committee meetings to address specific question and matters on the performance and remuneration of
the senior management team. This excluded any matter concerning their own remuneration. The Company Secretary acts as
secretary to the Committee.
Corporate governance report continued
Annual report on remuneration continued
1
2
3
4
5
Remuneration
118
SIG Annual Report and Accounts 2024
Voting outcomes
The following table shows the results of the advisory vote on the 2023 Directors’ remuneration report at the AGM held on
2 May 2024 and the vote to approve the remuneration policy from the AGM held on 4 May 2023.
Resolution
Votes cast
‘for’
%
Votes cast
‘against’
%
Votes
‘withheld’
To approve the annual statement by the Chair of the
Remuneration Committee and the Directors’ remuneration
report for the year ended 31 December 2023
945,578,316
96.6
32,850,159
3.4
37,226
To approve the Directors’ remuneration policy
925,096,437
96.8
29,655,028
3.2
5,835,784
Review of Committee terms of reference
Revised terms of reference were adopted in December 2020. During 2024 the Committee has reviewed the appropriateness
of these terms and made a number of reasonably minor amendments. The latest version can be found on the Group’s website
at www.sigplc.com.
Committee performance review
An internal performance review of the Committee was conducted for 2024 and further details can be found on page 83.
The recommendations from the Committee’s 2023 performance review are set out below together with a summary of the
progress that was made to satisfy the recommendations during the year:
2023 Recommendations
Action taken during 2024
Monitoring the impact of the execution of the
Group’s new four-pillar business strategy and
ensuring that incentive arrangements and
targets remain appropriate to support that
in a volatile economic environment.
The Committee regularly monitored the execution progress of the business
strategy and progress towards incentive targets set. In addition, the Committee
reviewed more broadly the appropriateness of incentive arrangements aligned
to delivery of the strategy.
Operating the annual bonus plans and RSP
and assessing performance against the
corresponding targets/underpins.
The Committee reviewed the incentive arrangements across the Group as
well as progress against targets set ensuring the right performance and
behaviours were being driven. In addition, underpin and windfall tests were
regularly reviewed. Recommendations put by Management and agreed by
the Committee on the bonus incentives for implementation in 2024 were also
reviewed for progress by the Committee.
Ensuring talent is appropriately incentivised
and that SIG remains able to attract the right
capabilities to meet the differing needs of its
different businesses.
The Committee reviewed the remuneration and incentives of the senior
leaders, identified talent and more broadly workforce terms and conditions,
ensuring that remuneration and incentives were appropriately applied and
differentiated to the variable needs of different businesses.
Kath Durrant
Chair of the Remuneration Committee
4 March 2025
119
Strategic Report
Governance
Financials
SIG Annual Report and Accounts 2024
Corporate governance report continued
Directors’ report
The Directors present their report and consolidated financial statements of the Group for the year ended 31 December 2024.
In accordance with the Companies Act 2006 (“CA 2006”) other information required to be included in this Directors’ report are
included in the Strategic Report on pages 1 to 67. The Corporate Governance Report is deemed to be incorporated into this
Directors’ report by reference and can be found on pages 68 to 119. Further disclosure requirements contained in the CA 2006,
Schedule 7 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Part 3 of the
Companies (Miscellaneous Reporting) Regulations 2018, the UK Listing Rules (‘UKLR’) and the Disclosure Guidance and
Transparency Rules (‘DTRs’) of the Financial Conduct Authority, which are not located in this Directors’ report can be found:
Disclosure
Page
reference
Acquisitions and disposals
160
Going concern statement
59
Directors’ biographies
70-71
Directors’ interests
115
Employee policies and the employment of disabled persons
51
Details on employee share schemes and long-term incentive schemes
153-154
Future developments in the business
1-67
Research and development activities
14-25
Disclosure of greenhouse (GHG) gas emissions
30
Environmental, social and governance (ESG) matters
26-51
Engagement with employees, suppliers, customers and others
76-77
Principal risks and uncertainties
62-67
Financial risk management and financial instruments
164-169
Post-balance sheet events
182
Corporate Governance Statement including internal control and risk management statements
68-69; 96-97
Statement of Directors’ Responsibilities
125
Shareholder information
209
Subsidiary undertakings
206-208
Viability statement
60
Substantial shareholdings
The Company had received notification of the following shareholdings in its issued share capital pursuant to the DTRs as at
31 December 2024 and 4 March 2025.
Shareholder
Interests disclosed
to the Company
as at 31 December
2024
%
Interests disclosed
to the Company
as at 4 March
2025
%
CD&R Sunshine S. a. r. l.
342,220,120
28.96%
342,220,120
28.96%
IKO Enterprises Limited
174,918,803
14.80%
174,918,803
14.80%
AzValor Asset Management
119,010,1521
10.07%
136,879,816
11.59%
Aberforth Partners LLP
86,508,997
7.33%
86,508,997
7.33%
BlackRock Investment Management
73,341,875
6.20%
59,733,214
5.03%
Wellcome Trust
38,247,837
3.23%
38,247,837
3.23%
1. Notification received after 31 December 2024 in respect of a holding reached in October 2024.
120
SIG Annual Report and Accounts 2024
Whistleblowing
The Group has in place a Whistleblowing policy under which employees may, in confidence, raise concerns about possible
wrongdoing in financial reporting or other matters. A copy of this policy is available on the Group’s website (www.sigplc.com).
The Group also has a confidential hotline in place, which is available to all Group employees and provides a facility for them
to bring matters to management’s attention on a confidential basis. The hotline is provided by an independent third party.
During 2024, these systems were operational throughout the Group.
A full investigation is carried out on all matters raised and where a whistleblowing report has been prepared, an update is
provided to the Board as part of the Group General Counsel & Company Secretary’s report. The Group General Counsel &
Company Secretary also reports to the Board concerning ongoing investigations and conclusions reached. During 2024, Group
employees used this system to raise concerns about a number of separate issues, all of which were appropriately responded to.
Statement of the Directors on the disclosure of information to the Auditor
The Directors who held office at the date of approval of the Directors’ report confirm that:
–so far as they are each aware, there is no relevant audit information of which the Company’s Auditor is unaware; and
–each Director has taken all steps that they ought to have taken as a Director 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 CA 2006.
On the recommendation of the Audit & Risk Committee (see page 94, in accordance with Section 489 of the CA 2006,
resolutions are to be proposed at the AGM for the reappointment of Ernst & Young LLP as Auditor of the Company and to
authorise the Audit & Risk Committee to agree its remuneration. The remuneration of the Auditor for the year ended
31 December 2024 is fully disclosed in Note 3 to the Consolidated financial statements on page 149.
Powers of Directors
The Directors are responsible for the management of the business of the Company and may exercise all powers of the
Company subject to the provisions of the Company’s articles and of the CA 2006. A copy of the articles is available at
www.sigplc.com.
Employees
The Group is committed to investing in, and rewarding, its workforce and accordingly it continues to develop and improve
upon local recognition programmes, which recognise outstanding work, efforts and achievements that are aligned with Group
behaviours. The Group provides regular training opportunities for its employees and also operates a share incentive plan for UK
employees.
It is important that each employee understands the Group’s strategies, policies and procedures. Regular communication with
employees takes place through Workplace and employees are invited to attend results presentations held by the CEO and CFO.
Employee views are sought through the annual employee engagement survey. Further information on employee engagement
activities can be found on pages 75 to 77.
Numerical diversity data as at 31 December 2024
Our gender identity and ethnicity data in accordance with UKLR 6.6.6R (9) in the format set out in UKLR 6 Annex 1 at the
year-end is set out below. Board members and ELT members were asked to complete a standardised diversity disclosure form
on a confidential and voluntary basis, self-reporting to questions aligned to the data required by, and definitions set out in,
the UKLR.
Gender identity
Number of
Board members
Percentage
of the Board
Number of senior
positions on the
Board (CEO, CFO,
SID and Chairman)
Number in
executive
management (ELT)
Percentage of
executive
management (ELT)
Men
8
80%
3
11
79%
Women
2
20%
1
3
21%
Not specified/prefer not to say
—
—
—
—
—
121
Strategic Report
Governance
Financials
SIG Annual Report and Accounts 2024
Directors’ report continued
Corporate governance report continued
Ethnic background
Number of
Board members
Percentage
of the Board
Number of senior
positions on the
Board (CEO, CFO,
SID and Chairman)
Number in
executive
management (ELT)
Percentage of
executive
management (ELT)
White British or other White
(including minority-white groups)
9
90%
4
14
100%
Mixed/Multiple Ethnic Groups
—
—
—
—
—
Asian/Asian British
1
10%
—
—
—
Black/African/Caribbean/Black British
—
—
—
—
—
Other ethnic group
—
—
—
—
—
Not specified/prefer not to say
—
—
—
—
—
Publication of Annual Report and
Notice of AGM
Shareholders are to note that the SIG
plc 2024 Annual Report together with
the notice convening the 2025 AGM will
be published on the Group’s website
(www.sigplc.com). If shareholders
have elected to receive shareholder
correspondence in hard copy, then the
Annual Report and notice convening
the AGM will be distributed to them.
Political donations
During the year, the Company and
its subsidiaries did not make any
political donations or incur any political
expenditure. At the forthcoming Annual
General Meeting shareholders will be
asked to approve, on a precautionary
basis, for the Company and its
subsidiaries to make political donations
and incur political expenditure for the
year ending 31 December 2025. Details
of the Group’s policies in relation to
corporate governance are disclosed
on page 51.
Group results and dividends
The Consolidated income statement
for the year ended 31 December 2024
is shown on page 127. The movement
in Group reserves during the year is
shown on page 130 in the Consolidated
statement of changes in equity.
Segmental information is set out in
Note 1 to the Consolidated financial
statements on pages 146 to 148.
The Board has taken the decision not
to declare a final dividend for the year
ended 31 December 2024 (2023: nil).
No interim dividend was paid in 2024
(2023: nil). Therefore, the total dividend
paid in 2024 was nil (2023: nil).
Related party transactions
Except as disclosed in Note 30 to the
Consolidated financial statements on
page 183, and except for Directors’
service contracts and the Relationship
Agreement with CD&R, the Company
did not have any material transactions or
transactions of an unusual nature with,
and did not make loans to, related
parties in the periods in which any
Director is or was materially interested.
Summary of key terms of the
CD&R Relationship Agreement
The Company entered into a
Relationship Agreement with CD&R on
29 May 2020, which will remain effective
as long as CD&R is entitled to exercise
10% or more of the votes able to be cast
on matters at general meetings of the
Company. The Relationship Agreement
regulates the Company’s relationship
with CD&R. It includes agreement by
CD&R that it shall (and ensure that its
associates shall), among other things,
conduct all transactions with the
Group at arm’s length and on normal
commercial terms, not take actions that
would have the effect of preventing the
Group from carrying on its business
independently and not take any action
that would prevent the Group from
complying with its obligations under the
UKLR and other applicable laws and
regulations. More details on the content
of the Relationship Agreement can be
found in the prospectus dated 19 June
2020, which is available on the Group’s
website (www.sigplc.com). As far as
the Group is aware the undertakings
included in the Relationship Agreement
have been complied with during the
period under review.
Further details on the CD&R relationship
in practice can be found on page 78.
Directors’ and officers’ liability
insurance and indemnities
The Company purchases liability
insurance cover for Directors and
officers of the Company and its
subsidiaries, which gives appropriate
cover for any legal action brought
against them. The Company has also
provided an indemnity, which was in
force during the financial year for its
Directors to the extent permitted by the
law in respect of liabilities incurred as
a result of their office. The indemnity
would not provide any coverage to the
extent that a Director is proven to have
acted fraudulently or dishonestly.
No claims or qualifying indemnity
provisions and no qualifying pension
scheme indemnity provisions have been
made either during the year or by the
date of approval of this Directors’ report.
Share capital
The Company has a single class
of share capital, which is divided
into ordinary shares of 10p each. At
31 December 2024, the Company had a
called-up share capital of £118,155,697.70
divided into ordinary shares of 10p
each (2023: £118,155,697.70).
During the year ended 31 December
2024, Directors’ options over 2,077,720
ordinary shares vested under the
Company’s share option schemes.
No new ordinary shares were allotted
to satisfy the vesting of these options
and no new ordinary shares have been
allotted under these schemes since the
end of the financial year to the date of
this report. Details of outstanding
options under the Group’s employee
and executive schemes are set out
in Note 9 on page 153, which also
contains details of options granted
over unissued share capital.
122
SIG Annual Report and Accounts 2024
Rights attaching to shares
The rights attaching to the ordinary
shares are defined in the Company’s
Articles of Association. The Articles
of Association may be changed by
special resolution of the Company.
A shareholder whose name appears
on the Company’s Register of Members
can choose whether their shares are
evidenced by share certificates (e.g.
in certificated form) or held in electronic
(e.g. uncertificated) form in CREST (the
electronic settlement system in the UK).
Subject to any restrictions below,
shareholders may attend any general
meetings of the Company and, on a
show of hands, every shareholder (or
their representative) who is present at
a general meeting has one vote on
each resolution and, on a poll, every
shareholder (or their representative)
who is present has one vote on each
resolution for every ordinary share
of which they are the registered
shareholder.
A resolution put to the vote of a general
meeting is decided on a show of hands
unless before or on the declaration of
the result of a vote on a show of hands,
a poll is demanded by the Chairman
of the meeting, or by at least five
shareholders (or their representatives)
present in person and having the right
to vote, or by any shareholders (or their
representatives) present in person
having at least 10% of the total voting
rights of all shareholders, or by any
shareholders (or their representatives)
present in person holding ordinary
shares in which an aggregate sum has
been paid up of at least one-tenth of the
total sum paid up on all ordinary shares.
Shareholders can declare final dividends
by passing an ordinary resolution, but
the amount of such dividends cannot
exceed the amount recommended by
the Board. The Board can pay interim
dividends on any class of shares of the
amounts and on the dates and for the
periods they decide provided the
distributable profits of the Company
justify such payment. The Board may, if
authorised by an ordinary resolution of
the shareholders, offer any shareholder
the right to elect to receive new ordinary
shares, which will be credited as fully
paid, instead of their cash dividend.
Any dividend that has not been claimed
for 12 years after it became due for
payment will be forfeited and will then
belong to the Company unless the
Directors decide otherwise.
If the Company is wound up, the
liquidator can, with the sanction of an
extraordinary resolution passed by
the shareholders, divide among the
shareholders all or any part of the assets
of the Company and they can value any
assets and determine how the division
shall be carried out as between the
members or different classes of
members. The liquidator can also
transfer the whole or any part of the
assets to trustees upon any trusts
for the benefit of the members. No
shareholders can be compelled to
accept any asset which would give
them a liability.
Under the Company’s share incentive
scheme (the ‘SIP’), the SIP trustee
holds shares on behalf of employee
participants. In accordance with the SIP
trust deed and rules, the SIP trustee
must act in accordance with any
directions given by a SIP participant
in respect of their SIP shares. In the
absence of any such directions from a
SIP participant the SIP trustee will not
take any action in respect of SIP shares.
Under the SIG employee benefit trust
(the ‘EBT’), the EBT trustee holds shares
to be used for the settlement of awards
granted under the Company’s incentive
plans. The EBT trustee has, under the
trust deed establishing the EBT, waived
all rights to vote in respect of any shares
held in the EBT, except any shares
participants own beneficially, in respect
of which it will invite participants to
direct how the trustee shall act in
relation to the shares held on their
behalf. The number of shares held in
the EBT on 4 March 2025 was
20,614,080. The EBT trustee also waives
any dividends on shares held in the EBT.
Further information relating to the
change of control provisions under the
Group’s incentive plans appears within
the remuneration policy available on the
Group’s website (www.sigplc.com).
Voting at general meetings
Any form of proxy sent by the Company
to shareholders in relation to any general
meeting must be delivered to the
Company, whether in written or
electronic form, no less than 48 hours
before the time appointed for holding
the meeting or adjourned meeting at
which the person named in the
appointment proposes to vote.
The Board may determine that the
shareholder is not entitled to exercise
any right conferred by being a
shareholder if they or any person with an
interest in shares has been sent a notice
under Section 793 of the CA 2006
(which confers upon public companies
the power to require information with
respect to interests in their voting
shares) and they or any interested
person failed to supply the Company
with the information requested within
14 days after delivery of that notice.
The Board may also decide that no
dividend is payable in respect of those
default shares and that no transfer of
any default shares shall be registered.
These restrictions end seven days after
receipt by the Company of a notice of
an approved transfer of the shares or
all the information required by the
relevant Section 793 Notice, whichever
is the earlier.
Transfer of shares
The Board may refuse to register a
transfer of a certificated share that is not
fully paid, provided that the refusal does
not prevent dealings in shares in the
Company from taking place on an
open and proper basis. The Board
may also refuse to register a transfer
of a certificated share unless: (i) the
instrument of transfer is lodged, duly
stamped (if necessary), at the registered
office of the Company or any other place
decided by the Board accompanied by a
certificate for the share to which it relates
and such other evidence as the Board
may reasonably require to show the right
of the transferor to make the transfer; (ii)
is in respect of only one class of shares;
and (iii) is in favour of not more than four
transferees.
Transfer of uncertificated shares must
be carried out using CREST and the
Board can refuse to register a transfer
of an uncertificated share in accordance
with the regulations governing the
operation of CREST.
123
Strategic Report
Governance
Financials
SIG Annual Report and Accounts 2024
Corporate governance report continued
Variation of rights
If at any time the capital of the Company
is divided into different classes of shares,
the special rights attaching to any class
may be varied or revoked either:
–with the written consent of the holders
of at least 75% in nominal value of the
issued shares of the class; or
–with the sanction of an extraordinary
resolution passed at a separate
general meeting of the holders of the
shares of the class.
The Company can issue new shares
and attach any rights to them. If there is
no restriction by special rights attaching
to existing shares, rights attaching to
new shares can take priority over the
rights of existing shares, or the new
shares and the existing shares are
deemed to be varied (unless the rights
expressly allow it) by a reduction of paid
up capital, or if another share of that
same class is issued and ranks in
priority for payment of dividend, or in
respect of capital or more favourable
voting rights.
Election and re-election
of Directors
The Company may, by ordinary
resolution, of which special notice has
been given in accordance with the CA
2006, remove any Director before the
expiration of their period of office. The
office of a Director shall be vacated if:
–they cease to be a Director by virtue of
any provision of law or are removed
pursuant to the Company’s Articles of
Association or they become prohibited
by law from being a Director;
–they become bankrupt or compound
with their creditors generally;
–they become of unsound mind or a
patient for any purpose of any statute
relating to mental health and the Board
resolves that their office is vacated;
–they resign;
–they fail to attend Board meetings for
six consecutive months without leave
of absence from the Board and the
Board resolves that the office
is vacated;
–their appointment terminates in
accordance with the provisions
of the Company’s Articles;
–they are dismissed from
executive office;
–they are convicted of an indictable
offence and the Directors resolve that
it is undesirable in the interests of the
Company that they remain as a
Director; or
–the conduct of the Director is the
subject of an investigation and the
Directors resolve that it is undesirable
in the interests of the Company that
they remain a Director.
The Board may, from time to time,
appoint one or more Directors as
Managing Director or to fulfil any other
executive function within the Company
for such term, remuneration and other
conditions of appointment as it may
determine, and it may revoke such
appointment (subject to the provisions
of the CA 2006).
Agreements with employees and
significant agreements
(contracts of significance)
There are no agreements between
the Company and its Directors or
employees providing for compensation
for loss of office or employment
(whether through resignation, purported
redundancy or otherwise) that occurs
because of a takeover bid.
The Company’s borrowing
arrangements are terminable upon
a change of control of the Company.
Fixed assets
In the opinion of the Directors, there
is no material difference between
the book value and the current open
market value of the Group’s interests
in land and buildings.
CREST
The Company’s ordinary shares are
in CREST, the settlement system for
stocks and shares.
2025 Interim Report
Current regulations permit the Company
not to send hard copies of its Interim
Reports to shareholders and therefore
the Company intends to publish its
Interim Report on its website at
www.sigplc.com.
Authority to purchase own
ordinary shares
Shareholders’ authority for the purchase
by the Company of 118,155,698 of its
own shares existed at the end of the
year. The Company has made no
purchases of its own ordinary shares
pursuant to this authority. The Company
will seek to renew this authority.
Cautionary statement
The cautionary statement can be found
on page 61 of the Strategic report.
Approval of the Directors’ report
The Directors’ report set out on pages
120 to 124 was approved by the Board
of Directors on 4 March 2025 and
signed on its behalf by:
Andrew Watkins
Group General Counsel & Company
Secretary
4 March 2025
Directors’ report continued
124
SIG Annual Report and Accounts 2024
Directors’ Responsibilities
Statement
The Directors are responsible for
preparing the Annual Report and the
Financial Statements in accordance with
applicable law and regulations.
Company law requires the Directors
to prepare Financial Statements for
each financial year. Under that law
the Directors have elected to prepare
the Group Financial Statements
in accordance with UK adopted
international accounting standards and
the requirements of the Companies Act
2006. The Directors have elected to
prepare the Parent Company Financial
Statements in accordance with United
Kingdom Generally Accepted Practice
(United Kingdom Accounting Standards
and applicable law), including Financial
Reporting Standard 101 Reduced
Disclosure Framework (‘FRS 101’).
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 the Company and of the
profit and loss of the Group and the
company for that period.
In preparing the Parent Company
Financial Statements, the Directors are
required to:
–select suitable accounting policies
and then apply them consistently;
–make judgements and accounting
estimates that are reasonable
and prudent;
–state whether applicable UK
Accounting Standards have been
followed, subject to any material
departures disclosed and explained
in the Financial Statements; and
–prepare the Financial Statements on
the going concern basis unless it is
inappropriate to presume that the
Company will continue in business.
In preparing the Group Financial
Statements, International Accounting
Standard 1 requires that Directors:
–properly select and apply accounting
policies;
–present information, including
accounting policies, in a manner that
provides relevant, reliable, comparable
and understandable information;
–provide additional disclosures
when compliance with the specific
requirements in the UK adopted
international accounting standards are
insufficient to enable users to
understand the impact of particular
transactions, other events and
conditions on the entity’s financial
position and financial performance;
and
–make an assessment of the Company’s
ability to continue as a going concern.
The Directors are responsible for
keeping adequate accounting records
that are sufficient to show and explain
the Company’s transactions and
disclose with reasonable accuracy, at
any time, the financial position of the
Group at that time and enable them
to ensure that the Financial Statements
comply with the Companies Act 2006.
They are also responsible for
safeguarding the assets of the 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
corporate and financial information
included on the Company’s website.
Legislation in the United Kingdom
governing the preparation and
dissemination of financial statements
may differ from legislation in other
jurisdictions.
Responsibility statement
We confirm that to the best of
our knowledge:
The Financial Statements, prepared in
accordance with the relevant financial
reporting framework, give a true and fair
view of the assets, liabilities, financial
position and profit or loss of the
Company and the undertakings
included in the consolidation taken
as a whole;
The Strategic report includes a fair
review of the development and
performance of the business and
the position of the Company, and
the undertakings included in the
consolidation taken as a whole, together
with a description of the principal risks
and uncertainties that they face; and
The Annual Report and Financial
Statements, taken as a whole, are fair,
balanced and understandable and
provide the information necessary for
shareholders to assess the Company’s
position and performance, business
model and strategy.
This responsibility statement was
approved by the Board of Directors
on 4 March 2025 and is signed on its
behalf by:
Gavin Slark
Chief Executive Officer
Ian Ashton
Chief Financial Officer
4 March 2025
125
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Financials
SIG Annual Report and Accounts 2024
Financial statements
Financials
127 Consolidated income statement
128 Consolidated statement of comprehensive income
129 Consolidated balance sheet
130 Consolidated statement of changes in equity
131 Consolidated cash flow statement
132 Accounting policies
143 Critical accounting judgements and key sources
of estimation uncertainty
146 Notes to the consolidated financial statements
184 Non-statutory information
186 Independent auditor’s report
196 Five-year summary
197 Company balance sheet
198 Company statement of changes in equity
199 Company accounting policies
202 Notes to the Company financial statements
206 Group companies 2024
209 Company information
126
SIG Annual Report and Accounts 2024
Consolidated income statement
for the year ended 31 December 2024
Note
Underlying1
2024
£m
Other items2
2024
£m
Total
2024
£m
Underlying1
2023
£m
Other items2
2023
£m
Total 2023
£m
Revenue
1
2,611.8
—
2,611.8
2,761.2
—
2,761.2
Cost of sales
(1,971.8)
—
(1,971.8)
(2,061.6)
—
(2,061.6)
Gross profit
640.0
—
640.0
699.6
—
699.6
Other operating expenses
2
(609.1)
(28.9)
(638.0)
(640.6)
(50.2)
(690.8)
Impairment (losses)/gains on
financial assets
2
(5.8)
—
(5.8)
(9.6)
1.1
(8.5)
Gain on disposal of property
2
—
—
—
3.7
—
3.7
Operating profit/(loss)
3
25.1
(28.9)
(3.8)
53.1
(49.1)
4.0
Finance income
5
2.7
—
2.7
2.2
—
2.2
Finance costs
5
(42.1)
(1.6)
(43.7)
(37.9)
(0.2)
(38.1)
(Loss)/profit before tax
(14.3)
(30.5)
(44.8)
17.4
(49.3)
(31.9)
Income tax (expense)/credit
6
(5.4)
1.6
(3.8)
(13.0)
1.5
(11.5)
(Loss)/profit after tax
(19.7)
(28.9)
(48.6)
4.4
(47.8)
(43.4)
Attributable to:
Equity holders of the Company
(19.7)
(28.9)
(48.6)
4.4
(47.8)
(43.4)
Loss per share
Basic
8
(4.2)p
(3.8)p
Diluted
8
(4.2)p
(3.8)p
1. Underlying represents the results before Other items. See the Accounting policies for further details.
2. Other items have been disclosed separately in order to give an indication of the underlying earnings of the Group. Other items are defined in the Accounting policies
and further details are disclosed in Note 2.
All results are from continuing operations.
The accompanying Accounting policies and Notes to the consolidated financial statements are an integral part of this
Consolidated income statement.
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Consolidated statement of comprehensive income
for the year ended 31 December 2024
Note
2024
£m
2023
£m
Loss after tax for the year
(48.6)
(43.4)
Items that will not subsequently be reclassified to the Consolidated
income statement:
Remeasurement of defined benefit pension liability
28
(0.2)
1.1
Deferred tax movement associated with remeasurement of defined benefit pension liability
22
—
(0.1)
(0.2)
1.0
Items that may subsequently be reclassified to the Consolidated income statement:
Exchange difference on retranslation of foreign currency goodwill and intangibles
(2.2)
(1.1)
Exchange difference on retranslation of foreign currency net investments (excluding goodwill
and intangibles)
(13.1)
(2.8)
Exchange and fair value movements associated with borrowings and derivative
financial instruments
12.3
5.8
Losses and gains on cash flow hedges
(1.1)
(1.1)
Transfer to profit and loss on cash flow hedges
1.0
(1.5)
(3.1)
(0.7)
Other comprehensive (expense)/income
(3.3)
0.3
Total comprehensive expense
(51.9)
(43.1)
Attributable to:
Equity holders of the Company
(51.9)
(43.1)
The accompanying Accounting policies and Notes to the consolidated financial statements are an integral part of this
Consolidated statement of comprehensive income.
128
SIG Annual Report and Accounts 2024
Consolidated balance sheet
as at 31 December 2024
Note
2024
£m
2023
£m
Non-current assets
Property, plant and equipment
10
64.9
65.4
Right-of-use assets
23
250.3
263.1
Goodwill
11
129.0
131.2
Intangible assets
12
12.5
15.3
Lease receivables
23
1.9
2.2
Deferred tax assets
22
4.6
4.4
Non-current financial assets
18
0.3
0.2
463.5
481.8
Current assets
Inventories
14
253.8
259.1
Lease receivables
23
0.3
1.1
Trade and other receivables
15
370.8
389.1
Current tax assets
15
2.3
3.6
Current financial assets
18
0.1
—
Cash at bank and on hand
18
87.4
132.2
714.7
785.1
Total assets
1,178.2
1,266.9
Current liabilities
Trade and other payables
16
358.6
385.8
Lease liabilities
16
64.9
64.9
Interest-bearing loans and borrowings
17
5.2
0.8
Deferred consideration
16
—
1.8
Derivative financial instruments
16,18
1.3
1.0
Current tax liabilities
16
1.7
6.9
Provisions
21
7.6
7.9
439.3
469.1
Non-current liabilities
Lease liabilities
23
258.7
264.9
Interest-bearing loans and borrowings
17
256.9
260.0
Derivative financial instruments
18
0.1
0.1
Other payables
2.8
3.0
Retirement benefit obligations
28
18.2
20.3
Provisions
21
22.4
21.0
559.1
569.3
Total liabilities
998.4
1,038.4
Net assets
179.8
228.5
Capital and reserves
Called up share capital
24
118.2
118.2
Treasury shares reserve
24
(8.6)
(11.6)
Capital redemption reserve
0.3
0.3
Share option reserve
7.8
7.6
Hedging and translation reserves
0.7
3.8
Cost of hedging reserve
0.1
0.1
Merger reserve
92.5
92.5
Retained (losses)/profits
(31.2)
17.6
Attributable to equity holders of the Company
179.8
228.5
Total equity
179.8
228.5
The accompanying Accounting policies and Notes to the consolidated financial statements are an integral part of this
Consolidated balance sheet.
The Consolidated financial statements were approved by the Board of Directors on 4 March 2025 and signed on its behalf by:
Gavin Slark
Ian Ashton
Director
Director
Registered in England: 00998314
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Financials
SIG Annual Report and Accounts 2024
Called up
share
capital
£m
Treasury
shares
reserve
£m
Capital
redemption
reserve
£m
Share
option
reserve
£m
Hedging
and
translation
reserves
£m
Cost of
hedging
reserve
£m
Merger
reserve
£m
Retained
profits/
(losses)
£m
Total
£m
As at 1 January 2023
118.2
(16.4)
0.3
8.6
4.5
0.1
92.5
60.0
267.8
Loss after tax
—
—
—
—
—
—
—
(43.4)
(43.4)
Other comprehensive
(expense)/income
—
—
—
—
(0.7)
—
—
1.0
0.3
Total comprehensive expense
—
—
—
—
(0.7)
—
—
(42.4)
(43.1)
Purchase of treasury shares
—
(1.7)
—
—
—
—
—
—
(1.7)
Credit to share option reserve
—
—
—
5.5
—
—
—
—
5.5
Settlement of share options
—
6.5
—
(6.5)
—
—
—
—
—
As at 31 December 2023
118.2
(11.6)
0.3
7.6
3.8
0.1
92.5
17.6
228.5
Loss after tax
—
—
—
—
—
—
—
(48.6)
(48.6)
Other comprehensive expense
—
—
—
—
(3.1)
—
—
(0.2)
(3.3)
Total comprehensive expense
—
—
—
—
(3.1)
—
—
(48.8)
(51.9)
Purchase of treasury shares
—
(0.9)
—
—
—
—
—
—
(0.9)
Credit to share option reserve
—
—
—
4.1
—
—
—
—
4.1
Settlement of share options
—
3.9
—
(3.9)
—
—
—
—
—
As at 31 December 2024
118.2
(8.6)
0.3
7.8
0.7
0.1
92.5
(31.2)
179.8
The share option reserve represents the cumulative equity-settled share option charge under IFRS 2 “Share-based payment”
less the value of any share options that have been exercised.
The hedging and translation reserves represent movements in the Consolidated balance sheet as a result of movements in
exchange rates and movements in the fair value of cash flow hedges which are reflected in equity through Other comprehensive
income as detailed in the Accounting policies.
Treasury shares relate to shares purchased by the SIG Employee Benefit Trust (“EBT”) to satisfy awards made under the
Group’s share plans which are not vested and beneficially owned by employees.
The merger reserve represents the premium on ordinary shares issued in a previous year through the use of a cash box structure.
The accompanying Accounting policies and Notes to the consolidated financial statements are an integral part of this
Consolidated statement of changes in equity.
Consolidated statement of changes in equity
for the year ended 31 December 2024
130
SIG Annual Report and Accounts 2024
Note
2024
£m
2023
£m
Net cash flow from operating activities
Cash generated from operating activities
25
83.5
128.4
Income tax paid
(8.0)
(14.0)
Net cash generated from operating activities
75.5
114.4
Cash flows from investing activities
Finance income received
2.7
2.2
Purchase of property, plant and equipment and computer software
(16.1)
(15.7)
Initial direct costs of right-of-use assets
(0.6)
(0.1)
Proceeds from sale of property, plant and equipment
1.8
5.6
Settlement of amounts payable for previous purchases of businesses
13
(4.4)
(0.7)
Net cash flow from investing activities
(16.6)
(8.7)
Cash flows from financing activities
Finance costs paid
(37.5)
(36.9)
Repayment of lease liabilities
(67.5)
(63.6)
Repayment of borrowings
(239.7)
(0.8)
Proceeds from borrowings
247.0
—
Acquisition of treasury shares
(0.9)
(1.7)
Net cash flow from financing activities
(98.6)
(103.0)
(Decrease)/increase in cash and cash equivalents in the year
26
(39.7)
2.7
Cash and cash equivalents at beginning of the year1
27
132.2
130.1
Effect of foreign exchange rate changes
27
(5.1)
(0.6)
Cash and cash equivalents at end of the year1
27
87.4
132.2
1. Cash and cash equivalents comprise cash at bank and on hand of £87.4m (2023: £132.2m) less bank overdrafts of £nil (2023: £nil).
The accompanying Accounting policies and Notes to the consolidated financial statements are an integral part of this
Consolidated cash flow statement.
Consolidated cash flow statement
for the year ended 31 December 2024
131
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SIG Annual Report and Accounts 2024
The material accounting policy information relating to this Annual Report and Accounts for the year ended 31 December 2024 is
set out below.
Basis of preparation
The Consolidated financial statements are prepared in accordance with UK adopted international accounting standards.
The Consolidated financial statements have been prepared under the historical cost convention except for derivative financial
instruments and unquoted investments which are stated at their fair value. The principal accounting policies applied in the
preparation of these Consolidated financial statements are set out below. These policies have been consistently applied to all
the years presented, unless otherwise stated.
The qualifying partnership, The SIG 2018 Scottish Limited Partnership, which is included in these Consolidated financial
statements, is entitled to exemption under Regulation 7(1) from the requirements of Regulations 4 to 6 of Part 2 of The
Partnerships (Accounts) Regulations 2008 in relation to preparation and audit of annual financial statements of the partnership.
Advantage has been taken of the exemption conferred by this regulation.
The Consolidated financial statements have been prepared on a going concern basis as set out below.
In preparing the Consolidated financial statements, management has considered the impact of climate change, particularly in
the context of the financial statements as a whole, in addition to disclosures included in the Strategic report this year. This
included an assessment of the impact on the carrying value of non-current assets and the impact on forecasts used in the
impairment review and the assessments of going concern and longer term viability. These considerations did not have a
material impact on the financial reporting judgements and estimates, consistent with the assessment that climate change is not
expected to have a significant impact on the Group’s going concern assessment to 31 March 2026 nor the viability of the Group
over the next three years.
Going concern
The Group closely monitors its funding position throughout the year, including monitoring compliance with covenants and
available facilities to ensure it has sufficient headroom to fund operations.
The Group’s financing facilities comprise €300m fixed rate secured notes, due October 2029, €13.5m fixed rate secured notes,
due November 2026, and a £90m Revolving Credit Facility (RCF) that expires in April 2029. One of the trading businesses also
has a £1.3m bank loan repayable over the period to June 2026. The secured notes are subject to incurrence-based covenants
only, and the RCF has a leverage maintenance covenant which is only effective if the facility is over 40% (i.e. £36m) drawn at a
quarter end reporting date. The RCF was undrawn at 31 December 2024 and has remained undrawn subsequent to the year end.
The Group has significant available liquidity and on the basis of current forecasts is expected to remain in compliance with all
banking covenants throughout the forecast period to 31 March 2026 (“the going concern period”).
The Directors have considered the Group’s forecasts which support the view that the Group will be able to continue to operate
within its banking facilities and comply with its banking covenants. The Directors have considered the following principal risks
and uncertainties that could potentially impact the Group’s ability to fund its future activities and adhere to its banking
covenants, including:
–prolonged challenging trading conditions in the Group’s larger businesses, leading to lower volumes;
–pricing pressure on sales and modest net input cost deflation; and
–current economic and political uncertainties, potentially further impacting market demand.
The forecasts on which the going concern assessment is based have been subject to sensitivity analysis and stress testing to
assess the impact of the above risks and the Directors have also reviewed mitigating actions that could be taken. Following two
years of market-driven downturn, with a LFL revenue decline of 2% in 2023 and 4% in 2024, and continued market uncertainty,
a severe but plausible downside scenario has been modelled, which factors in a 2.5% reduction in revenue, a reduction in gross
margin and a resulting 32% reduction in underlying operating profit from the base forecast for the 12 months to 31 March 2026.
Certain mitigations are also included, for example delaying non-essential capital expenditure. Under this scenario the analysis
shows that sufficient cash would be available without triggering a covenant breach, as the RCF is not expected to be drawn
above the £36m at a relevant quarter end date, and furthermore the leverage covenant would also be below the required
threshold. Reverse stress testing has also been performed, which shows that the Group could withstand up to an 11%
reduction in revenue from the base forecasts for the nine months to the forecast liquidity low point of 30 September 2025, or
up to 13% reduction for the 12 months to 31 March 2026, before triggering a covenant breach. Up to £90m RCF is available to
meet working capital requirements during the month, providing this is reduced to £36m before the quarter end date if the
leverage covenant is expected to be breached. Further cash phasing mitigations would also be available to avoid the
requirement to draw over £36m at a quarter end date if required.
Accounting policies
for the year ended 31 December 2024
132
SIG Annual Report and Accounts 2024
The Directors have considered the impact of climate-related matters on the going concern assessment and this is not expected
to have a significant impact on the Group’s going concern assessment to 31 March 2026.
On consideration of the above, the Directors believe that the Group has adequate resources to continue in operational existence
for the forecast period to 31 March 2026 and the Directors therefore consider it is appropriate to adopt the going concern basis
in preparing the 2024 Consolidated financial statements.
New standards, interpretations and amendments adopted
The Group has adopted the following new standards, amendments and interpretations which apply for the first time in 2024:
–Amendments to IAS 1: Classification of liabilities as current or non-current and non-current liabilities with covenants
–Amendments to IFRS 16: Lease liability in sale and leaseback
–Amendments to IAS 7 and IFRS 7: Supplier finance arrangements
As a result of the adoption of the amendments to IAS 7 and IFRS 7, the Group has provided new disclosures relating to liabilities
under supplier finance arrangements in Note 16. The other amendments have not had a material impact on the Financial
statements of the Group.
New standards, amendments and interpretations not yet adopted
Certain new accounting standards and interpretations have been published that are not mandatory for 31 December 2024
reporting periods and have not been early adopted by the Group. IFRS 18 “Presentation and Disclosure in Financial Statements”
will be effective for the financial year ending 31 December 2027, with retrospective application required. IFRS 18 will not impact
the recognition or measurement of items in the financial statements, but will have an impact on presentation and disclosure,
which the Group is currently assessing. None of the other new standards, amendments or interpretations are expected to have
a material impact on the Group in the current or future reporting periods or on foreseeable future transactions.
Basis of consolidation
The Consolidated financial statements incorporate the Financial statements of the Company and each of its subsidiary
undertakings after eliminating all significant intercompany transactions and balances. The results of subsidiary undertakings
acquired or sold are consolidated for the periods from or to the date on which control passed.
Changes in the Group’s interests in subsidiaries that do not result in a loss of control are accounted for as equity transactions.
The carrying amount of the Group’s interests and the non-controlling interests are adjusted to reflect the changes in their
relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and
the fair value of the consideration paid or received is recognised directly in equity and attributed to the shareholders of the
Company.
Profit and loss on disposal is calculated as the difference between the aggregate of the fair value of the consideration received
and the previous carrying amount of the net assets (including goodwill and intangible assets) of the businesses.
Goodwill and business combinations
All business combinations are accounted for by applying the purchase method. Goodwill arising on consolidation represents the
excess of the cost of the acquisition over the Group’s interest in the fair value of identifiable assets (including intangible assets)
and liabilities of the business acquired.
Goodwill is stated at cost less any accumulated impairment losses. Goodwill is not amortised but is tested annually for
impairment, or more frequently when there is an indication that goodwill may be impaired. For the purposes of impairment
testing, goodwill is allocated to each of the Group’s cash generating units (“CGUs”) expected to benefit from the synergies
of the combination. If the recoverable amount of the CGU is less than the carrying amount of the unit, the impairment loss is
allocated first to reduce the carrying amount of any goodwill allocated to the CGU and then to the other assets of the CGU pro
rata on the basis of the carrying amount of each asset in the CGU. Right-of-use assets recognised on adoption of IFRS 16 are
included in the carrying amount of the CGU, with cash flows and discount rates adapted accordingly to calculate value in use
on a consistent basis. An impairment loss recognised against goodwill cannot be reversed in a subsequent period.
A CGU is the lowest level at which independent cash inflows can be identified, which is considered to be at an operating
company level. Each operating company includes a number of branches, but due to the interdependency of various elements
of the branch operations and sharing of resources, the operating company is considered to be the most appropriate CGU.
On disposal of a subsidiary, the attributable amount of remaining goodwill relating to the entity disposed of is included in the
determination of any profit or loss on disposal.
Goodwill recorded in foreign currencies is retranslated at each period end. Any movements in the carrying value of goodwill
as a result of foreign exchange rate movements are recognised in the Consolidated statement of comprehensive income.
Any excess of the fair value of net assets over consideration arising on an acquisition is recognised immediately in the
Consolidated income statement.
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Foreign currency
Transactions denominated in foreign currencies are recorded in the local currency and converted at actual exchange rates at
the date of the transaction. Any gain or loss arising from a change in exchange rates subsequent to the date of the transaction
is included as an exchange gain or loss in the Consolidated income statement.
At each balance sheet date, monetary assets and liabilities denominated in foreign currencies are reported at the rates of
exchange prevailing at that date.
On consolidation, assets and liabilities of overseas subsidiary undertakings are translated into sterling at the rate of exchange
prevailing at the balance sheet date. Income and expense items are translated into sterling at the average rate of exchange for
the year as an approximation where actual rates do not fluctuate significantly.
Exchange differences arising on translation of the opening net assets and results of overseas operations, and on foreign
currency borrowings, to the extent that they hedge the Group’s investment in such operations, are reported in the Consolidated
statement of comprehensive income.
On the disposal of a foreign operation the exchange differences accumulated in equity in respect of that operation are
reclassified to the Consolidated income statement.
Consolidated income statement disclosure
Income statement items are presented in the middle column of the Consolidated income statement entitled Other items where
they are significant in size and nature, and either they do not form part of the trading activities of the Group, or their separate
presentation enhances understanding of the financial performance of the Group.
Items classified as Other items relevant to the current and prior year are as follows:
– Costs related to acquisitions
The Group has made a number of acquisitions in previous years. There are a number of specific costs relating to these
acquisitions which make comparison of performance of the businesses and segments difficult. Therefore the following items
are recorded as Other items to provide a more comparable view of the businesses and enhance the clarity of the performance
of the Group and its businesses to the readers of the Financial statements:
(i) amortisation of intangible assets acquired through business combinations;
(ii) expenses related to contingent consideration required to be treated as remuneration for acquired businesses;
(iii) costs and credits arising from the re-estimation of deferred and contingent consideration payable in respect of acquisitions;
and
(iv) costs related to the acquisition of businesses.
– Impairment charges
Impairment charges related to non-current assets are non-cash items and tend to be significant in size. The presentation of
these as Other items further enhances the understanding of the ongoing performance of the Group. Impairments of property,
intangible assets and other tangible fixed assets are included in Other items if related to the overall annual impairment review
of goodwill and other non-current assets, a fundamental restructuring project or other fundamental project or if significant in
size. Other impairments are included in underlying results.
– Net restructuring costs
Restructuring costs are classified as Other items if they relate to a fundamental change in the organisational structure of the
Group or a fundamental change in the operating model of a business within the Group. Costs may include redundancy,
property closure costs and consultancy costs, which are significant in size and will not be incurred under the ongoing
structure or operating model of the Group. These costs are therefore recorded as Other items in order to provide a better
understanding of the ongoing financial performance of the Group. Careful consideration is applied by management in
assessing whether these costs relate to fundamental restructuring and changing the structure and operating model of the
business as opposed to costs incurred in the normal course of business.
– Costs associated with refinancing
Costs associated with the refinancing and changes to debt facility agreements during the year are included within Other items
as they are significant in size, do not form part of the underlying trading activities and will not be incurred on an ongoing basis.
– Cloud based ERP implementation costs
Costs incurred in relation to the implementation of Software as a Service (“SaaS”) arrangements which are recognised as
expenses in the Consolidated income statement are included within Other items if they relate to significant strategic projects
such as ERP implementations and are considered to meet the Group’s definition of Other items.
– Other specific items
Other specific items are recorded in Other items where they do not form part of the underlying trading activities of the Group
in order to enhance the understanding of the financial performance of the Group. This includes, for example, profit on sale
of property not related to ongoing operations (i.e. related to a branch or business closure) or property sold as part of a
fundamental restructuring programme. Profit on the sale of property in connection with branch or office moves in the normal
course of business is included within underlying results. A full breakdown of other specific items is included in Note 2 to the
Consolidated financial statements.
Accounting policies continued
for the year ended 31 December 2024
134
SIG Annual Report and Accounts 2024
– Other items within finance income and finance costs
The write-off of arrangement fees related to the previous debt arrangements is included within finance costs in Other items,
as this is significant in size, does not form part of the underlying trading activities and will not be incurred on an ongoing basis,
consistent with other costs associated with the refinancing as above.
– Taxation
The taxation effect of Other items is shown within Other items in order to enhance the understanding of the underlying tax
position of the Group.
Revenue from contracts with customers
Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected
on behalf of third parties. The Group recognises revenue when it transfers control over a product or service to a customer.
a) Sale of goods
The majority of the Group’s revenue arises from contracts with customers for the sale of goods, with one performance
obligation. Revenue is recognised at the point in time that control of the goods passes to the customer, usually on delivery to
the customer. Standard payment terms vary across the different businesses but generally range from 8 to 60 days from end of
month. The amount of revenue recognised is impacted by the following:
Volume rebates:
The Group provides retrospective volume rebates to certain customers, which give rise to variable consideration. The Group
estimates the expected volume rebates using an expected value approach based on expected volumes and thresholds in the
contracts. The Group then applies the constraint regarding variable consideration and revenue is only recognised to the extent
that it is highly probable that a significant reversal will not occur. Expected volume rebates due to customers are recognised as
a reduction to trade receivables.
Early settlement discounts:
Early settlement discounts are estimated using the expected value approach based on past experience and are recognised at
the time of recognising the revenue, subject to the constraint regarding variable consideration that it is highly probable that a
change in estimate would not result in a significant reversal of the cumulative revenue recognised.
b) Construction contracts
The Group has contracts for the provision of industrial services which fall under the category of “construction contracts”.
One of the Group’s business in Ireland provides industrial painting, coating and repair services. Revenue from these contracts
is recognised over time, as the entity’s performance enhances a customer-controlled asset, using an output method to measure
progress towards completion, based on agreed rates and/or valuation schedules agreed with the customer which confirm the
amounts invoiced each month, depending on individual contract terms.
Any earned consideration that is conditional is recorded as a contract asset. A contract asset becomes a receivable when
receipt is conditional only on the passage of time. Therefore, revenue recognised from construction contracts described above
which has not yet been invoiced is recognised as a contract asset, which is shown as a separate line item on the Consolidated
balance sheet rather than as part of trade and other receivables (£nil in 2024 and 2023). Invoices are raised as the contract
progresses based on agreed milestones, rates or valuation schedules depending on the terms of individual contracts, with
subsequent payment in accordance with agreed payment terms.
c) Presentation and disclosure requirements
The Group has disaggregated revenue recognised from contracts with customers into categories that depict how the nature,
amount, timing and uncertainty of revenue and cash flows are affected by economic factors. The Group has also disclosed
information about the relationship between the disclosure of disaggregated revenue and the revenue information disclosed
for each reportable segment. Refer to Note 1 for the disclosure on disaggregated revenue.
Supplier rebates
Supplier rebate income is significant to the Group’s results, with a substantial proportion of purchases covered by rebate
agreements. Some supplier rebate agreements are non-coterminous with the Group’s financial year, and firm confirmation
of amounts due may not be received until after the balance sheet date.
Where the Group relies on estimates, these are made with reference to contracts or other agreements, management forecasts
and detailed operational workbooks. Supplier rebate income estimates are regularly reviewed by senior management.
Outstanding amounts at the balance sheet date are included in trade payables when the Group has the right to offset against
amounts owing to the supplier and therefore settles on a net basis, in line with IAS 32 criteria. Where the supplier rebates are not
netted off the amounts owing to that supplier, the outstanding amount is included within prepayments and accrued income. The
carrying value of inventory is reduced by the associated amount where the inventory has yet to be sold at the balance sheet date.
Operating profit
Operating profit is stated after charging distribution costs, selling and marketing costs and administrative expenses, but before
finance income and finance costs.
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Taxation
Income tax on the profit or loss for the periods presented comprises both current and deferred tax. Income tax is recognised in
the Consolidated income statement except to the extent that it relates to items recognised directly in equity, in which case it is
recognised in the Consolidated statement of comprehensive income or the Consolidated statement of changes in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates that have been enacted by the balance
sheet date, and any adjustment to tax payable in respect of previous years. Current tax assets and liabilities are offset when there
is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied
by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.
Uncertain tax treatments are accounted for in accordance with IFRIC 23. The Group determines whether to consider each
uncertain tax treatment separately or together with one or more other uncertain tax treatments and uses the approach that
better predicts the resolution of the uncertainty.
Deferred tax is provided using the balance sheet liability method, providing for all temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
In accordance with IAS 12, the following temporary differences are not provided for:
–Goodwill not deductible for taxation purposes.
–The initial recognition of assets or liabilities that affect neither accounting nor taxable profit.
–Differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future and
the Group is able to control the reversal.
The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount
of assets and liabilities, using tax rates enacted or substantively enacted by the balance sheet date. A deferred tax asset is
recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be
utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
The Group applies the exception in IAS 12 “Income taxes” from recognising and disclosing information about deferred tax
assets and liabilities related to Pillar Two income taxes.
Share-based payment transactions
Employees (including senior executives) of the Group receive remuneration in the form of share-based payments, whereby
employees render services as consideration for equity instruments (equity-settled transactions). Equity settled share-based
payments are measured at fair value at the date of grant based on the Group’s estimate of the number of shares that will
eventually vest. The fair value determined is then expensed in the Consolidated income statement on a straight-line basis over
the vesting period, with a corresponding increase in equity. The fair value of the options is measured using the Black-Scholes
option pricing model.
The amount recognised as an expense is adjusted to reflect the actual number of share options that vest.
For equity-settled share options, at each balance sheet date the Group revises its estimate of the number of share options
expected to vest as a result of the effect of non-market-based vesting conditions. The impact of the revision of the original
estimates, if any, is recognised in the Consolidated income statement such that the cumulative expense reflects the revised
estimate, with a corresponding adjustment to equity reserves.
Service and non-market performance conditions are not taken into account when determining the grant date fair value of
awards, but the likelihood of the conditions being met is assessed as part of the Group’s best estimate of the number of equity
instruments that will ultimately vest. Market performance conditions are reflected within the grant date fair value. Any other
conditions attached to an award, but without an associated service requirement, are considered to be non-vesting conditions.
Non-vesting conditions are reflected in the fair value of an award and lead to an immediate expensing of an award unless there
are also service and/or performance conditions.
No expense is recognised for awards that do not ultimately vest because non-market performance and/or service conditions
have not been met. Where awards include a market or non-vesting condition, the transactions are treated as vested irrespective
of whether the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions are
satisfied.
The EBT purchases shares in the Company in order to satisfy awards made under the Company’s share plans. The EBT is
included in the Consolidated financial statements of the Group. Shares held by the EBT which are not vested and beneficially
owned by employees are treated as treasury shares and a deduction is included in the Company’s weighted average number
of shares in issue for the purpose of calculating earnings/(loss) per share.
Accounting policies continued
for the year ended 31 December 2024
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Intangible assets
The Group recognises intangible assets at cost less accumulated amortisation and impairment losses. The Group recognises
two types of intangible asset: acquired and purchased. Acquired intangible assets arise as a result of applying IFRS 3 “Business
Combinations” which requires the separate recognition of intangible assets from goodwill on all business combinations.
Purchased intangible assets relate primarily to software that is separable from any associated hardware.
Intangible assets are amortised on a straight-line basis over their useful economic lives as follows:
Amortisation period
Current average useful life
Customer relationships
Life of the relationship
7 to 10 years
Non-compete contracts
Life of the contract
3 years
Computer software
Useful life of the software
3 to 10 years
Assets in the course of construction are carried at cost, with amortisation commencing once the assets are ready for their
intended use.
Software as a service (“SaaS”) arrangements
SaaS arrangements are arrangements in which the Group does not currently control the underlying software used in the
arrangement. These arrangements are accounted for as a service contract over the contract period. The Group’s policy in
relation to costs incurred to configure or customise the software to specific requirements is as follows:
–Where costs incurred to configure or customise SaaS arrangements result in the creation of a resource which is identifiable,
and where the Group has the power to obtain the future economic benefit flowing from the underlying resource and to restrict
the access of others to those benefits, such costs are capitalised as separate software intangible assets and amortised over
the useful life of the software on a straight-line basis.
–Where costs incurred to configure or customise do not result in the recognition of an intangible software asset then those
costs that provide the Group with a distinct service (in addition to the SaaS access) are recognised as expenses when the
supplier provides the services. When such costs incurred do not provide a distinct service, the costs are expensed as
incurred. Costs are included within Other items in the Consolidated income statement if they relate to significant strategic
projects such as ERP implementations and are considered to meet the Group’s definition of Other items.
Property, plant and equipment
Property, plant and equipment is shown at original cost to the Group less accumulated depreciation and any provision for
impairment.
Depreciation is provided at rates calculated to write off the cost less the estimated residual value of property, plant and
equipment on a straight-line basis over their estimated useful lives as follows:
Current estimate of useful life
Freehold buildings
50 years
Leasehold properties and improvements
Period of lease (3 to 25 years)
Plant and machinery (including motor vehicles)
3 to 8 years
Freehold land is not depreciated.
Residual values, which are based on market rates, are reassessed annually. Assets in the course of construction are carried at
cost, with depreciation charged on the same basis as all other assets once those assets are ready for their intended use.
Investment property
Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition the Group has
chosen to apply the cost model. Investment properties are therefore recognised at cost and depreciated over the useful life and
are impaired when appropriate in accordance with IAS 16 “Property, plant and equipment”.
Transfers are made to or from investment property only when there is a change in use. If owner-occupied property becomes an
investment property, the Group accounts for such property in accordance with the policy stated under property, plant and
equipment up to the date of change in use.
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Finance income and expenses
Finance income comprises interest income on bank deposits and is recognised as it accrues using the effective interest method.
Finance expenses comprise interest and fees on bank facilities, loans, secured notes, leases and defined benefit pension
schemes and the unwinding of discounts on provisions. Interest expense is recognised in the Consolidated income statement
using the effective interest method and includes the amortisation of fees associated with the arrangement of financing.
Leases and hire purchase agreements
Leases and hire purchase agreements are recognised in accordance with IFRS 16 “Leases”.
The Group’s leasing activities
The Group leases various offices, warehouses, branches, equipment and vehicles. Rental contracts are typically made for fixed
periods of 3 to 10 years but may have extension or early termination options. Certain property leases have a term of up to 25
years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease
agreements do not impose any covenants.
How leases are accounted for
A lease liability is recognised based on the discounted present value of total future lease payments, with a corresponding
right-of-use asset including any initial direct costs recognised and depreciated over the lease term. The lease payments are
discounted using the lessee’s incremental borrowing rate or the interest rate implicit in the lease. The Group remeasures lease
liabilities and right-of-use assets when there is a change of lease term, lease payments or a change in the assessment of
exercising of a purchase option. The impact of these changes is included within modifications in Note 23.
Where a lease liability relates to an onerous lease contract the right-of-use asset is assessed for impairment. Payments due
under the lease continue to be included in the lease liability, therefore a separate provision is not required. Provisions for
short-term onerous lease contracts continue to be recognised.
Definition of a lease
A lease is a contract (i.e. an agreement between two or more parties that creates enforceable rights and obligations), or part of
a contract, that conveys the right to control the use of an identified asset for a period of time in exchange for consideration. It is
determined whether a contract is a lease or contains a lease at the inception of the contract. Under IFRS 16, an identified asset
can be either implicitly or explicitly specified in a contract.
Lease term
In accordance with IFRS 16, the lease term is defined as the non-cancellable period of the lease, together with:
–periods covered by an option to extend the lease if the lessee is reasonably certain to exercise that option; and
–periods covered by an option to terminate the lease if the lessee is reasonably certain not to exercise that option.
Variable lease payments
Variable lease payments based on an index or a rate are part of the lease liability. Variable lease payments are initially measured
using the index or the rate at the commencement date. Forecast future changes in rates are not included; these are only taken
into account at the point in time at which lease payments change.
The Group has a few property leases where rentals are based on an index but with a cap and collar, and for such leases the
minimum future increase is included in the initial recognition of the lease liability where relevant. Other variable payments, for
example additional costs based on usage or vehicle mileage, are not included in the lease liability.
Asset restoration costs
Where there is an obligation under a lease contract to dismantle and/or restore the asset to its original condition, provision is
made for this in accordance with IAS 37, and the initial carrying amount of this provision is included within fixed assets on
inception of the lease. The liability continues to be recorded as a separate provision on the balance sheet (i.e. it is not included
in the IFRS 16 lease liability).
Exemptions
The Group has certain assets with lease terms of 12 months or less and leases of equipment with low value. The Group applies
the ‘short-term lease’ and ‘lease of low-value assets’ recognition exemptions for these leases.
Inventories
Inventories are stated at the lower of cost (including an appropriate proportion of attributable overheads, supplier rebates and
discounts) and net realisable value. The cost formula used in measuring inventories is either a weighted average cost, or a
first-in first-out basis, depending on the most appropriate method for each business. Most businesses use weighted average,
with the exception of Poland and Ireland, where first-in first-out is used.
Net realisable value is based on estimated normal selling price, less further costs expected to be incurred up to completion
and disposal. Provision is made for obsolete, slow-moving or defective items where appropriate.
Accounting policies continued
for the year ended 31 December 2024
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Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with an original maturity of three months or less.
Bank overdrafts that are repayable on demand and form an integral part of the Group’s cash management are included as a
component of cash and cash equivalents for the purposes of the Consolidated cash flow statement.
Lease payments are presented as follows in the Consolidated cash flow statement:
–Short term lease payments and payments for leases of low-value assets that are not included in the measurement of the lease
liabilities are presented within cash flows from operating activities.
–Payments for the interest element of recognised lease liabilities are included in ‘Finance costs paid’ within cash flows from
financing activities.
–Payments for the principal element of recognised lease liabilities are presented within cash flows from financing activities.
Cash flows in relation to the settlement of amounts payable for previous purchases of businesses related to consideration
dependent on vendors remaining within the business are classified as an operating cash flow. Cash flows in relation to
contingent or deferred consideration not dependent on vendors remaining within the business are classified as a cash flow
from investing activities.
Financial assets
Financial assets are classified as either financial assets subsequently measured at amortised cost, fair value through profit and
loss (“FVPL”) or fair value through other comprehensive income (“FVOCI”).
The classification at initial recognition depends on the financial asset’s contractual cash flow characteristics and the Group’s
business model for managing them. With the exception of trade receivables that do not contain a significant financing
component or for which the Group has applied the practical expedient, the Group initially measures a financial asset at its fair
value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do
not contain a significant financing component or for which the Group has applied the practical expedient are measured at the
transaction price determined under IFRS 15.
The Group measures financial assets at amortised cost if both the following conditions are met:
–The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual
cash flows; and
–The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal
and interest on the principal amount outstanding.
The Group’s financial assets are all measured at amortised cost, except for derivative financial instruments (“FVPL”) and
unquoted investments (“FVOCI”).
Financial assets at amortised cost are subsequently measured using the effective interest method and are subject to
impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired.
The Group’s financial assets include trade receivables, deferred consideration and cash and cash equivalents.
Impairment of financial assets
The Group recognises an allowance for expected credit losses (“ECLs”) for all debt instruments held at amortised cost. ECLs
are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that
the Group expects to receive, discounted at an approximation of the original effective interest rate. For trade receivables and
contract assets, the Group applies the standard’s simplified approach and calculates ECLs based on lifetime expected credit
losses. The Group has established a provision matrix that is based on the Group’s historical credit loss experience, adjusted
for forward looking factors specific to the debtors and economic environment.
Derecognition
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily
derecognised (i.e. removed from the Consolidated balance sheet) when:
–the rights to receive cash flows from the asset have expired; or
–the Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received
cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Group has
transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained
substantially all the risks and rewards of the asset but has transferred control of the asset.
Trade receivables that are factored out to banks and other financial institutions without recourse to the Group are derecognised
at the point of factoring as the risks and rewards of the receivables have been fully transferred. In assessing whether the
receivables qualify for derecognition, the Group has considered the receivables and receivable insurance contracts as two
separate units of account. Therefore, the insurance is not included as part of the derecognition assessment on the basis that
the insurance is not similar to the receivables. The Group has elected to recognise cash inflows from the sale of factored
receivables as an operating cash flow.
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Financial liabilities
Financial liabilities are classified at initial recognition as financial liabilities at fair value through profit or loss, loans and
borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. All financial
liabilities, except for derivative financial instruments (see below), are recognised initially at fair value, net of directly attributable
transaction costs, and are subsequently measured at amortised cost using the effective interest rate (“EIR”) method.
The Group classified financial liabilities that arise from supplier finance arrangements within Trade and other payables in the
Consolidated balance sheet if they have a similar nature and function to trade payables. This is the case if the supplier finance
arrangement is part of the working capital used in the Group’s normal operating cycle, the level of security provided is similar
to trade payables and the terms of the liabilities that are part of the supplier finance arrangement are not substantially different
from the terms of comparable trade payables that are not part of the arrangement. Cash flows related to liabilities arising from
supplier finance arrangements that are classified in Trade and other payables in the Consolidated balance sheet are included in
operating activities in the Consolidated cash flow statement.
A financial obligation is derecognised when the obligation under the liability is discharged, cancelled or expires. When an
existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing
liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and
the recognition of a new liability. Where a modification of a financial liability does not result in derecognition, the amortised
cost of the financial liability is recalculated by computing the present value of estimated future contractual cash flows that are
discounted at the loan’s original EIR. Any consequent adjustment (gain or loss on modification) is recognised immediately in
profit or loss. The gain or loss on modification will unwind over the remaining term of the liability, with the movement recognised
in finance costs.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated at the initial date of
recognition and only if the criteria in IFRS 9 are satisfied. The Group has not designated any financial liability as at fair value
through profit or loss.
When determining the fair value of financial liabilities, the expected future cash flows are discounted using an appropriate
interest rate.
Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the
contractual arrangement.
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the Consolidated balance sheet if there is
a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise
the assets and settle the liabilities simultaneously.
Derivative financial instruments
The Group uses derivative financial instruments including interest rate swaps, forward foreign exchange contracts, and cross-
currency swaps to hedge its exposure to foreign currency exchange and interest rate risks arising from operational and
financing activities. In accordance with its treasury policy, the Group does not hold or issue derivative financial instruments for
trading purposes. However, any derivative financial instruments that do not qualify for hedge accounting are accounted for as
trading instruments. Derivatives are classified as non-current assets or non-current liabilities if the remaining maturity of the
derivatives is more than 12 months and they are not expected to be otherwise realised or settled within 12 months. Other
derivatives are presented as current assets or current liabilities.
Derivative financial instruments are recognised immediately at fair value. Subsequent to their initial recognition, derivative
financial instruments are then stated at their fair value. The fair value of derivative financial instruments is derived from
“mark-to-market” valuations obtained from the Group’s relationship banks.
Unless hedge accounting is achieved, the gain or loss on remeasurement to fair value is recognised immediately and is included
as part of finance income or finance costs, together with other fair value gains and losses on derivative financial instruments,
within Other items in the Consolidated income statement.
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, exercised, no longer qualifies for
hedge accounting, or when the Group revokes the hedging relationship. At that time, any cumulative gain or loss on the hedging
instrument recognised in equity is retained in equity until the forecast transaction occurs. If a hedged transaction is no longer
expected to occur, the net cumulative gain or loss recognised in equity is transferred to the Consolidated income statement in
the period.
For the purposes of hedge accounting, hedges are classified as:
–fair value hedges when hedging the exposure to changes in the fair value of a recognised asset or liability or an unrecognised
commitment;
–cash flow hedges when hedging the exposure to variability in cash flows that is either attributable to a particular risk
associated with a recognised asset or liability or a highly probably forecast transaction or the foreign currency risk in an
unrecognised firm commitment; or
–hedges of a net investment in a foreign operation.
Accounting policies continued
for the year ended 31 December 2024
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At the inception of the hedge relationship, the Group formally designates and documents the hedge relationship to which it
wishes to apply hedge accounting, along with its risk management objectives and its strategy for undertaking the hedging
transaction.
The documentation includes identification of the hedging instrument, the hedged item, the nature of the risk being hedged and
how the Group will assess whether the hedging relationship meets the hedge effectiveness requirements (including the analysis
of sources of hedge ineffectiveness and how the hedge ratio is determined). A hedging relationship qualifies for hedge
accounting if it meets all of the following effectiveness requirements:
–There is “an economic relationship” between the hedged item and the hedging instrument;
–The effect of credit risk does not “dominate the value changes” that result from that economic relationship; and
–The hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged item that the Group
actually hedges and the quantity of the hedging instrument that the Group actually uses to hedge that quantity of hedged item.
Hedges that meet all the qualifying criteria for hedge accounting are accounted for as described below.
Fair value hedges
The change in the fair value of the hedged item attributable to the risk being hedged is recorded as part of the carrying value of
the hedged item and is recognised in the Consolidated income statement within Other items. The change in the fair value of the
hedging instrument is also recognised in the Consolidated income statement within Other items. The Group did not have any
fair value hedges in place in the current or prior year.
Cash flow hedges
The effective part of any gain or loss on the hedging instrument is recognised directly in the Consolidated statement of
comprehensive income in the cash flow hedging reserve. When the forecast transaction subsequently results in the recognition
of a non-financial asset or non-financial liability, the associated cumulative gain or loss is removed from equity and included in
the initial cost or other carrying amount of the non-financial asset or liability. If a hedge of a forecast transaction subsequently
results in the recognition of a financial asset or financial liability, the associated gains or losses that were previously recognised
in the Consolidated statement of comprehensive income are reclassified into the Consolidated income statement in the same
period or periods during which the asset acquired or liability assumed affects the Consolidated income statement.
For cash flow hedges, the ineffective portion of any gain or loss is recognised immediately as fair value gains or losses on
derivative financial instruments and is included as part of finance income or finance costs within Other items in the Consolidated
income statement. The Group designates only the spot element of forward contracts as a hedging instrument. The forward
element is recognised in other comprehensive income and accumulated in a separate component of equity under cost of
hedging reserve.
Hedges of net investment in foreign operations
The portion of any gain or loss on an instrument used to hedge a net investment in a foreign operation that is determined to be
an effective hedge is recognised in the Consolidated statement of comprehensive income. The ineffective portion of any gain or
loss is recognised immediately as fair value gains or losses on derivative financial instruments and is included as part of finance
income or finance costs within Other items within the Consolidated income statement. Gains and losses deferred in the foreign
currency translation reserve are recognised immediately in the Consolidated income statement when foreign operations are
disposed of.
Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is
probable that a transfer of economic benefit will be required to settle the obligation and a reliable estimate can be made of the
obligation. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects,
when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage
of time is recognised as a finance cost.
Leasehold dilapidations
Provisions are recognised in relation to contractual obligations to reinstate leasehold properties to their original state of repair.
The provision is calculated based on both the liability to rectify or reinstate leasehold improvements and modifications carried
out on the inception of the lease, recognised on inception with a corresponding fixed asset, and the liability to rectify general
wear and tear which is recognised as incurred over the life of the lease. The provision recognised is based on estimated
expected value using current cost estimates and therefore the net impact of inflation and discounting to present value is
not considered material.
A description of the nature and accounting of other provisions by type is included in Note 21.
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Pension schemes
The Group operates four defined benefit pension schemes. The Group’s net obligation in respect of these defined benefit
pension schemes is calculated separately for each plan by estimating the amount of future benefit that employees have earned
in return for their service in both current and prior periods. That benefit is discounted using an appropriate discount rate to
determine its present value and the fair value of any plan assets is deducted.
Where the benefits of the plan are improved, the portion of the increased benefit relating to past service by employees is
recognised as an expense in the Consolidated income statement, at the earlier of when the plan amendment or curtailment
occurs and when the entity recognises related restructuring costs or termination benefits.
The full service cost of the pension schemes is charged to operating profit. Net interest costs on defined benefit pension
schemes are recognised in the Consolidated income statement. Discretionary contributions made by employees or third parties
reduce service costs upon payment of these contributions into the plan.
Any actuarial gain or loss arising is charged through the Consolidated statement of comprehensive income and comprises the
difference between the expected returns on assets and those actually achieved, any changes in the actuarial assumptions for
demographics and any changes in the financial assumptions used in the valuations.
The pension scheme deficit is recognised in full and presented on the face of the Consolidated balance sheet. The associated
deferred tax asset is recognised within non-current assets on the Consolidated balance sheet.
For defined contribution schemes the amount charged to the Consolidated income statement in respect of pension costs and
other post-retirement benefits is the contributions payable in the year. Differences between contributions payable in the year
and contributions actually paid are included within either accruals or prepayments on the Consolidated balance sheet.
Dividends
Dividends proposed by the Board of Directors that have not been paid by the end of the year are not recognised in the
Consolidated financial statements until they have been approved by the shareholders at the Annual General Meeting.
Segmental reporting
In accordance with IFRS 8 “Operating Segments”, the Group identifies its reportable segments based on the components of
the business on which financial information is regularly reviewed by the Group’s Chief Operating Decision Maker (“CODM”) to
assess performance and make decisions about how resources are allocated. For SIG, the CODM is considered to be the
Executive Leadership Team (“ELT”). Reported operating segments are consistent with those reported in the 2023 Annual
Report and Accounts. The UK Exteriors and France Exteriors segments have been renamed UK Roofing and France Roofing
respectively in the current year, consistent with as reported in the 2024 Interim results. Inter-segment revenue is charged at the
prevailing market rates.
Accounting policies continued
for the year ended 31 December 2024
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In the application of the Group’s accounting policies, which are described on pages 132 to 142, the Directors are required to
make judgements (other than those involving estimates) that have a significant impact on the amounts recognised and to make
estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources.
The estimates and associated assumptions are based on historical experience and other factors that are considered to be
relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the change takes place if the revision affects only that period, or in the period of the revision
and future periods if the revision affects both current and future periods.
Critical judgements in applying the Group’s accounting policies
The following are the critical judgements that the Directors have made in the process of applying the Group’s accounting
policies and that have had a significant effect on the amounts recognised in the Consolidated financial statements.
The judgements involving estimations are dealt with separately below.
Classification of Other items in the Consolidated income statement
As described in the Accounting policies, certain items are presented in the separate column of the Consolidated income
statement entitled Other items where they are significant in size or nature, and either they do not form part of the trading
activities of the Group or their separate presentation enhances understanding of the financial performance of the Group.
The nature and amounts of the items included in Other items, together with the overall impact on the results for the year,
is disclosed in Note 2 of the Consolidated financial statements.
Recognition of deferred tax assets
Deferred tax assets are recognised for unused tax attributes to the extent that it is probable that taxable profit will be available
against which the attributes can be utilised, after consideration of available taxable temporary differences. The Group has
£109.5m (2023: £99.4m) of potential deferred tax assets relating to cumulative tax losses and other deductible timing
differences in the UK and Benelux, which are currently unrecognised as it is not considered probable that sufficient future
taxable profits will be available to allow the utilisation of the deductible temporary differences.
Although the UK trading businesses in aggregate have generated positive underlying operating profit in the current year, the
UK tax group remains in a taxable loss position due to the head office costs and interest on the secured notes, and there is
not considered to be sufficient convincing evidence at 31 December 2024 that sufficient future taxable profits will be available.
This required significant management judgement to determine the likely timing and level of future taxable profits and whether
sufficient, convincing evidence was available at 31 December 2024 to recognise the previously unrecognised deferred tax
assets. If the Group were able to recognise all unrecognised deferred tax assets, profit and equity would have increased by
£109.5m (2023: £99.4m). Further details are disclosed in Note 22.
Lease term
Where the Group is a lessee, judgement is required in determining the lease term at initial recognition, and throughout the lease
term, where extension or termination options exist. The Group applies judgement in evaluating whether it is reasonably certain
whether or not an option to extend or terminate the lease will be exercised, considering all relevant factors that may create an
economic incentive to exercise either the extension or termination. Information on potential future rental payments relating to
periods following the exercise date of extension and termination options that are not included in the lease term is included in
Note 23.
Key sources of estimation uncertainty
The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying value of the
assets and liabilities within the next financial year are detailed below.
Post-employment benefits
The Group operates four defined benefit pension schemes. All post-employment benefits associated with these schemes have
been accounted for in accordance with IAS 19 “Employee Benefits”. As detailed within the Accounting policies, in accordance
with IAS 19, all actuarial gains and losses have been recognised immediately through the Consolidated statement of
comprehensive income.
For all defined benefit pension schemes, pension valuations have been performed using specialist advice obtained from
independent qualified actuaries. In performing these valuations, significant actuarial assumptions have been made to determine
the defined benefit obligation, in particular with regard to discount rate, inflation and mortality. Management considers the key
assumption to be the discount rate applied. In determining the appropriate discount rate, the Group considers the interest rates
of high quality corporate bonds excluding university bonds. If the discount rate were to be increased/decreased by 0.1% for
the UK scheme, this would decrease/increase the Group’s gross pension scheme deficit by £0.9m as disclosed in Note 28.
At 31 December 2024 the Group’s retirement benefit obligations were £18.2m (2023: £20.3m).
Critical accounting judgements and
key sources of estimation uncertainty
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Impairment of goodwill and non-current assets
The Group tests goodwill and the associated intangible assets, property, plant and equipment and right-of-use assets of CGUs
annually for impairment, or more frequently if there are indications that an impairment may be required. Determining whether
goodwill is impaired requires an estimation of the value in use of the CGUs to which goodwill has been allocated, including all
related assets, or an estimation of fair value less costs of disposal if higher than value in use. The key estimates made in the
value in use calculation are those regarding discount rates, sales growth rates, and expected changes to selling prices and
direct costs to reflect the operational gearing of the business. The Directors estimate discount rates using pre-tax rates that
reflect current market assessments of the time value of money for the Group and that also include a risk premium to factor in
a certain element of risk over and above that already included in the forecast cash flows where considered necessary.
Value in use is determined by forecasting cash flows based upon management’s three year projections, which include forecast
sales growth based on external data (construction PMI data and construction market growth forecasts) and management’s best
estimates of market development and growth from current commerical and strategic initiatives, and gross margin assumptions
based on management’s best estimates and previous experience. Annual growth rates based upon country specific inflation
expectations (2.0%-2.5%) are applied thereafter into perpetuity. Assumptions regarding sales growth, gross margin, and
discount rate are considered to be the key areas of estimation in the impairment review process, and appropriate sensitivities
have been performed and disclosed in Note 11.
Where value in use indicated an impairment, in the case of the UK Interiors and Benelux CGUs, the recoverable amount of
individual classes of assets has been determined on a fair value less costs of disposal basis. The key assumption used in the
determination of fair value less costs of disposal is the fair value of the right-of-use assets. For property right-of-use assets this
has been determined based on third party external valuations of a number of properties, considering the market rental value
that could be obtained from subleasing the properties, subject to landlord consent, and taking into account current market
conditions together with the location and condition of the properties.
For fleet right-of-use assets, this has been determined based on the estimated recoverable value that could be obtained from
returning the vehicles early, taking into account the estimated termination penalty compared to the future rentals remaining.
For UK Interiors there are certain lease contracts for HGV trucks where there is no right under the terms of the contract to
terminate the agreement before the end of the lease term and there is no right to sublet the vehicles, and these vehicles are
therefore deemed to have no determinable recoverable value under current contractual terms. An impairment charge of £7.3m
has therefore been recognised in relation to these vehicles. Further impairment may be incurred in future periods against
vehicles acquired under similar contractual terms, until such time as the value in use calculation of the CGU as a whole exceeds
the carrying value of the assets.
The carrying amount of relevant non-current assets at 31 December 2024 is £456.7m (2023: £475.0m) including right-of-use
assets recognised in accordance with IFRS 16. The most recent results of the impairment review process are disclosed in
Note 11. As noted above, an impairment charge of £7.3m has been recognised at 31 December 2024 in relation to fleet
right-of-use assets in the UK Interiors CGU. The carrying value of non-current assets associated with all the other Group’s
CGUs is considered supportable at 31 December 2024.
Whilst the Directors consider the assumptions used in the impairment review to be realistic, if actual results are different from
expectations then it is possible that the value of goodwill included in the Consolidated balance sheet could become impaired
further. The remaining carrying value of goodwill is £129.0m. Sensitivities are disclosed in Note 11. These indicate reasonably
possible scenarios which could lead to further impairment for certain CGUs.
Other areas of estimation uncertainty
The following areas of estimation uncertainty are not presented to comply with the requirements of paragraph 125 of IAS 1
“Presentation of Financial Statements” as it is not expected there is a significant risk of a material adjustment to the carrying
amount of assets and liabilities within the next financial year. They are presented as additional disclosure of estimates used in
the financial statements.
Rebates receivable
Supplier rebate income is significant to the Group’s result, with a substantial proportion of purchases covered by rebate
agreements. Supplier rebate income affects the recorded value of cost of sales, trade payables, trade and other receivables,
and inventories. The amounts payable under rebate agreements are often subject to negotiation after the balance sheet date.
At the balance sheet date, the Directors estimate the amount of rebate that will become payable and due to the Group under
these agreements based upon prices, volumes and product mix. The Group has recognised income from supplier rebates of
£348.0m for the year ended 31 December 2024 (2023: £369.3m). At 31 December 2024 trade payables is presented net of
£37.4m (2023: £36.5m) due from suppliers in respect of supplier rebates where the Group has the right to net settlement, and
included within prepayments and accrued income is £71.7m (2023: £70.4m) due in relation to supplier rebates where there is no
right to offset against trade payable balances. The majority of these balances relate to agreements which are coterminous with
the financial year end and therefore this reduces the level of estimation involved. Based on experience in the current year, the
amount received is not expected to vary from the amount recorded by more than £2.0m.
Critical accounting judgements and
key sources of estimation uncertainty continued
144
SIG Annual Report and Accounts 2024
Provisions against receivables
At 31 December 2024 the Group has recognised trade receivables with a carrying value of £271.0m (2023: £291.5m).
The Group recognises an allowance for ECLs in relation to trade receivables. The Group has established a provision matrix
that is based on the Group’s historical credit loss experience, adjusted for forward looking factors specific to the debtors and
economic environment. Changes in the economic environment or customer-specific circumstances could have an impact on
the recoverability of amounts included on the Consolidated balance sheet at 31 December 2024. The total allowance for ECLs
recorded at 31 December 2024 is £18.4m (2023: £20.0m). The bad debt to sales ratio of the Group has varied by up to 0.2%
over recent periods, therefore this gives an indication that the bad debt experience could vary by c£5m based on current year
sales. Further detail on trade receivables and the allowance for ECLs recognised is disclosed in Note 15.
Dilapidations provisions
The Group has a significant number of leasehold properties with contractual obligations to reinstate the properties to their
original state of repair at the end of the lease contract. The Group has recognised a provision of £25.9m at 31 December 2024
(2023: £25.7m) in relation to this obligation (see Note 21). The total provision includes both the estimated cost of rectifying or
reinstating leasehold modifications and improvements carried out, which is recognised at the inception of the lease with a
corresponding asset recognised in fixed assets and depreciated over the term of the lease, together with the estimated cost of
rectifying general wear and tear which is recognised as incurred over the life of the lease. Estimates are based on a combination
of a sample of assessments by third party independent property surveyors, internal assessments by the Group’s property
experts and previous settlement history. Whilst the Directors consider the estimates to be reasonable based on latest available
information, actual amounts payable could be different to the amount provided depending on specific circumstances of
individual properties and counterparties at the expiry of each lease contract. The amount payable is not expected to be
materially different to the amount provided in the following year but there could be a material adjustment over a longer
timescale. The provision is reassessed each year on the basis of latest information, which could also result in a change
in the value of the provision year-on-year of up to c10% based on past experience.
Leases – estimating the incremental borrowing rate
The Group cannot readily determine the interest rate implicit in leases, therefore, it uses its incremental borrowing rate (“IBR”)
to measure lease liabilities. The IBR is the rate of interest that the Group would have to pay to borrow over a similar term and
with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic
environment. The IBR therefore requires estimation when no observable rates are available, such as for subsidiaries that do not
enter into financing transactions. The Group estimates the IBR using observable inputs, such as market interest rates, when
available, and is required to make certain entity-specific estimates, for example to capture the economic environment in which
different subsidiaries and their leases are located.
145
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Governance
Financials
SIG Annual Report and Accounts 2024
Notes to the consolidated financial statements
for the year ended 31 December 2024
1. Revenue and segmental information
In accordance with IFRS 8 “Operating Segments”, the Group identifies its reportable operating segments based on the way in
which financial information is reviewed and business performance is assessed by the CODM. Reportable operating segments
are grouped on a geographical basis as explained in the Accounting policies.
2024
UK
Interiors
£m
UK
Roofing
£m
UK
Specialist
Markets
£m
Total UK
£m
France
Interiors
£m
France
Roofing
£m
Total
France
£m
Germany
£m
Benelux
£m
Ireland
£m
Poland
£m
Elimin-
ations
£m
Total
Group
£m
Type of product
Interiors
495.0
—
170.0
665.0 200.4
— 200.4
438.5 103.6
60.1
241.4
— 1,709.0
Exteriors
— 380.6
68.1
448.7
—
410.1
410.1
—
—
44.0
—
—
902.8
Inter-segment
revenue
4.1
1.1
15.2
20.4
0.1
11.8
11.9
—
—
0.2
—
(32.5)
—
Total underlying
and statutory
revenue
499.1
381.7
253.3 1,134.1 200.5 421.9 622.4
438.5 103.6 104.3
241.4
(32.5) 2,611.8
Nature of revenue
Goods for resale
(recognised at point
in time)
499.1
381.7
253.3 1,134.1 200.5 421.9 622.4
438.5 103.6
96.2
241.4
(32.5) 2,603.7
Construction
contracts
(recognised over
time)
—
—
—
—
—
—
—
—
—
8.1
—
—
8.1
Total underlying
and statutory
revenue
499.1
381.7
253.3 1,134.1 200.5 421.9 622.4
438.5 103.6 104.3
241.4
(32.5) 2,611.8
Segment result
before Other
items
(3.5)
13.2
4.8
14.5
6.2
8.0
14.2
4.7
(4.5)
3.3
4.6
—
36.8
Parent company
costs
(11.7)
Underlying
operating profit
25.1
Other items (Note 2)
(28.9)
Operating loss
(3.8)
Net finance costs
before Other items
(39.4)
Non-underlying
finance costs
(1.6)
Loss before tax
(44.8)
Income tax expense
(3.8)
Loss for the year
(48.6)
Other segment information:
2024
UK
Interiors
£m
UK
Roofing
£m
UK
Specialist
Markets
£m
Total UK
£m
France
Interiors
£m
France
Roofing
£m
Total
France
£m
Germany
£m
Benelux
£m
Ireland
£m
Poland
£m
Parent
company
£m
Total
Group
£m
Depreciation and
amortisation of fixed
assets, right-of-use
assets and computer
software
11.7
12.9
6.3
30.9
8.0
13.2
21.2
17.0
2.0
3.1
5.7
0.2
80.1
146
SIG Annual Report and Accounts 2024
2023
UK
Interiors
£m
UK
Roofing
£m
UK
Specialist
Markets
£m
Total UK
£m
France
Interiors
£m
France
Roofing
£m
Total
France
£m
Germany
£m
Benelux
£m
Ireland
£m
Poland
£m
Elimin-
ations
£m
Total
Group
£m
Type of product
Interiors
556.5
—
173.9
730.4
218.9
—
218.9
462.1
116.9
54.5
237.9
— 1,820.7
Exteriors
—
369.4
73.7
443.1
—
458.0
458.0
—
—
39.4
—
—
940.5
Inter-segment revenue
7.2
1.0
18.4
26.6
0.1
13.3
13.4
—
—
0.2
—
(40.2)
—
Total underlying and
statutory revenue
563.7
370.4
266.0 1,200.1 219.0
471.3 690.3
462.1
116.9
94.1
237.9
(40.2) 2,761.2
Nature of revenue
Goods for resale
(recognised at point
in time)
563.7
370.4
266.0 1,200.1 219.0
471.3 690.3
462.1
116.9
88.5
237.9
(40.2) 2,755.6
Construction
contracts (recognised
over time)
—
—
—
—
—
—
—
—
—
5.6
—
—
5.6
Total underlying and
statutory revenue
563.7
370.4
266.0 1,200.1 219.0
471.3 690.3
462.1
116.9
94.1
237.9
(40.2) 2,761.2
Segment result
before Other items
(1.6)
10.6
10.3
19.3
10.4
19.3
29.7
15.6
(3.0)
1.4
7.1
—
70.1
Parent company
costs
(17.0)
Underlying
operating profit
53.1
Other items (Note 2)
(49.1)
Operating profit
4.0
Net finance costs
before Other items
(35.7)
Non-underlying
finance costs
(0.2)
Loss before tax
(31.9)
Income tax expense
(11.5)
Loss for the year
(43.4)
Other segment information:
2023
UK
Interiors
£m
UK
Roofing
£m
UK
Specialist
Markets
£m
Total UK
£m
France
Interiors
£m
France
Roofing
£m
Total
France
£m
Germany
£m
Benelux
£m
Ireland
£m
Poland
£m
Parent
company
£m
Total
Group
£m
Depreciation and
amortisation of fixed
assets, right-of-use
assets and computer
software
15.5
12.4
5.1
33.0
7.4
12.6
20.0
15.9
2.2
3.0
4.6
0.3
79.0
Profit on sale of
property
—
—
—
—
—
3.7
3.7
—
—
—
—
—
3.7
147
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Financials
SIG Annual Report and Accounts 2024
1. Revenue and segmental information continued
Geographic information
The Group’s non-current operating assets (including property, plant and equipment, right-of-use assets, goodwill and intangible
assets but excluding lease receivables, deferred tax and financial assets) by geographical location are as follows:
Country
2024
£m
2023
£m
United Kingdom
225.0
240.0
Ireland
14.6
16.1
France
129.1
136.4
Germany
60.0
56.6
Poland
21.0
16.7
Benelux
7.0
9.2
Total
456.7
475.0
2. Operating expenses
a) Analysis of operating expenses
2024
2023
Before
Other items
£m
Other items
£m
Total
£m
Before
Other items
£m
Other items
£m
Total
£m
Operating expenses:
Distribution costs
316.1
10.3
326.4
320.9
4.3
325.2
Selling and marketing costs
172.5
1.1
173.6
179.8
2.6
182.4
Management, administrative and central costs
120.5
17.5
138.0
139.9
43.3
183.2
Total other operating expenses
609.1
28.9
638.0
640.6
50.2
690.8
Impairment losses/(gains) on financial assets
5.8
—
5.8
9.6
(1.1)
8.5
Gain on disposal of property
—
—
—
(3.7)
—
(3.7)
Total net operating expenses
614.9
28.9
643.8
646.5
49.1
695.6
b) Other items
(Loss)/profit after tax includes the following Other items which have been disclosed in a separate column within the Consolidated
income statement in order to provide a better indication of the underlying earnings of the Group (as explained in the Accounting policies):
2024
2023
Other items
£m
Tax impact
£m
Tax impact
%
Other items
£m
Tax impact
£m
Tax impact
%
Amortisation of acquired intangibles (Note 12)
(2.1)
0.1
4.8%
(2.8)
0.1
3.6%
Impairment charges1
(7.3)
—
—
(33.8)
—
—
Net restructuring costs2
(13.4)
1.0
7.5%
(8.0)
1.2
15.0%
Costs related to acquisitions (Note 13)
—
—
—
(3.2)
0.1
3.1%
Cloud based ERP implementation costs3
(1.0)
0.2
20.0%
(2.2)
0.1
4.5%
Onerous contract costs4
—
—
—
(0.2)
—
—
Costs associated with refinancing5
(3.9)
—
—
—
—
—
Other specific items6
(1.2)
0.3
25.0%
1.1
—
—
Impact on operating profit
(28.9)
1.6
5.5%
(49.1)
1.5
3.1%
Non-underlying finance costs7
(1.6)
—
—
(0.2)
—
—
Impact on (loss)/profit before tax
(30.5)
1.6
5.2%
(49.3)
1.5
3.0%
1. Impairment charges in the current year relate to right-of-use asset impairment in the UK Interiors CGU. See Note 11 for further details. Impairment charges in the prior year
related to the UK Interiors CGU and comprised £2.6m relating to goodwill, £2.2m customer relationships, £3.6m tangible fixed assets and £25.4m right-of-use assets.
2. Net restructuring costs in the year comprise £6.5m (2023: £6.7m) redundancy and related staff costs and £6.9m (2023: £2.4m) other branch closure costs, including
£2.9m (2023: £1.6m) impairment of right-of-use assets, tangible fixed assets and software costs, all related to restructuring across the Group. Costs in the prior year
were also offset by £1.1m gain on the sublease and termination of property leases previously impaired.
3. Cloud based ERP implementation costs relate to costs incurred on strategic projects which are expensed as incurred rather than being capitalised as intangible assets.
4. Onerous contract costs in the prior year related to the final settlement of provisions recognised in previous years for licence fee commitments where no future
economic benefit was expected to be obtained.
5. Costs associated with refinancing relates to legal and professional fees incurred in connection with the refinancing of the Group’s debt arrangements in the year.
6. Other specific items in the current year comprises the estimated impact of a property lease dispute, including impairment of right-of-use and fixed assets of £0.7m,
and costs relating to an investment property no longer in use by the Group. In the prior year, other specific items comprised £1.1m reversal of provision for lease
receivables, the reversal of onerous lease provisions and impairment of right-of-use assets in relation to a branch which was reopened, offset by additional
impairment of the investment property which is no longer in use by the Group.
7. Non-underlying finance costs in the current year includes £1.4m write-off of arrangement fees in relation to the previous debt arrangements and £0.2m (2023: £0.2m)
relating to the investment property referred to above.
The total impact of the above amounts on the Consolidated cash flow statement is a cash outflow of £17.1m (2023: £6.4m),
including costs accrued in the prior year and paid in the current year.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
148
SIG Annual Report and Accounts 2024
3. Operating profit/(loss)
2024
£m
2023
£m
Operating profit/(loss) is stated after charging/(crediting):
Cost of inventories recognised as an expense
1,959.0
2,053.1
Net decrease in provision for inventories
(1.3)
(0.1)
Depreciation of property, plant and equipment
12.5
12.7
Depreciation of right-of-use assets
66.4
63.9
Amortisation of acquired intangibles
2.1
2.8
Amortisation of computer software
1.2
2.4
Gain on disposal of property
—
(3.7)
Gain on disposal of other plant and equipment
(1.0)
(0.6)
Impairment charges (Notes 10 and 23)
11.0
35.7
Reversal of impairment of lease receivables (Note 2)
—
(1.1)
Impairment losses on trade receivables
5.8
9.6
Expense relating to short term leases (Note 23)
1.8
1.1
Foreign exchange rate gains
0.2
—
Auditor’s remuneration:
During the year the Group incurred the following costs for services provided by the Company’s auditor:
2024
£m
2023
£m
Audit of the Company and Group financial statements
0.9
0.9
Audit of the Company’s subsidiaries
1.7
1.6
Total audit fees1
2.6
2.5
Audit-related assurance services2
0.4
0.2
Total non-audit fees
0.4
0.2
Total fees
3.0
2.7
1. The current year costs include £nil in relation to the 2023 audit (2023: £nil in relation to 2022).
2. The audit-related assurance services comprise £0.2m (2023: £0.2m) relating to the interim review and £0.2m relating to assurance services in connection with the
refinancing completed during the year. It is usual practice for a company’s Auditor to perform this work.
The Audit and Risk Committee Report on pages 93 and 94 provides an explanation of how Auditor objectivity and
independence is safeguarded when non-audit services are provided by the Auditor.
4. Staff costs
Particulars of employees (including Directors) are shown below:
2024
£m
2023
£m
Employee costs during the year amounted to:
Wages and salaries
262.7
275.7
Social security costs
50.7
52.1
IFRS 2 share-based payment expense
4.1
5.1
Pension costs (Note 28)
7.7
8.1
Redundancy costs
1.8
1.4
Total staff costs
327.0
342.4
In addition to the above, redundancy and related staff costs of £6.5m (2023: £6.7m) have been included within Other items
(Note 2), including £nil (2023: £0.4m) share-based payment expense.
Of the pension costs noted above, a charge of £0.5m (2023: £0.6m) relates to defined benefit schemes and a charge of £7.2m
(2023: £7.5m) relates to defined contribution schemes. See Note 28 for more details.
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4. Staff costs continued
The average monthly number of persons employed by the Group during the year was as follows:
2024
Number
2023
Number
Distribution and operations
3,306
3,409
Sales and marketing
2,889
2,958
Management and administration
756
843
Total
6,951
7,210
Directors’ emoluments
Details of the individual Directors’ emoluments are given in the Directors’ Remuneration Report on page 112.
The employee costs shown above include the following emoluments in respect of Directors of the Company:
2024
£m
2023
£m
Directors’ remuneration (excluding IFRS 2 share-based payment expense but including social security costs)
2.4
2.4
Total
2.4
2.4
5. Finance income and finance costs
2024
2023
Underlying
£m
Other items
£m
Total
£m
Underlying
£m
Other items
£m
Total
£m
Finance income
Interest on bank deposits
2.7
—
2.7
2.2
—
2.2
Total finance income
2.7
—
2.7
2.2
—
2.2
Finance costs
On bank loans, overdrafts and other associated items1
3.5
—
3.5
3.6
—
3.6
On secured notes2
15.9
—
15.9
14.1
—
14.1
On obligations under lease contracts3
22.1
0.2
22.3
19.4
0.2
19.6
Total interest expense
41.5
0.2
41.7
37.1
0.2
37.3
Write-off of arrangement fees on extinguished debt4
—
1.4
1.4
—
—
—
Net finance charge on defined benefit pension
schemes
0.6
—
0.6
0.8
—
0.8
Total finance costs
42.1
1.6
43.7
37.9
0.2
38.1
Net finance costs
39.4
1.6
41.0
35.7
0.2
35.9
1. Other associated items includes the amortisation of arrangement fees of £0.2m (2023: £0.2m).
2. Included within finance costs on the secured notes is the amortisation of arrangement fees of £0.5m (2023: £0.5m).
3. See Note 2 for further details of non-underlying finance costs.
4. As part of the refinancing of the debt arrangements in October 2024, £238.9m of the secured notes were extinguished and the RCF was amended and restated, and
therefore arrangement fees that were being amortised over the term of the previous facilities have been written off.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
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SIG Annual Report and Accounts 2024
6. Income tax
The income tax expense comprises:
2024
£m
2023
£m
Current tax
UK & Ireland corporation tax:
charge for the year
0.5
0.1
adjustments in respect of previous years
(0.1)
(0.1)
0.4
—
Mainland Europe corporation tax:
charge for the year
3.7
12.2
adjustments in respect of previous years
0.1
0.5
3.8
12.7
Total current tax
4.2
12.7
Deferred tax
Origination and reversal of deductible temporary differences
(0.7)
(0.7)
Adjustments in respect of previous years
0.3
(0.4)
Effect of change in rate
—
(0.1)
Total deferred tax
(0.4)
(1.2)
Total income tax expense
3.8
11.5
As the Group’s profits and losses are earned across a number of tax jurisdictions an aggregated income tax reconciliation is
disclosed, reflecting the applicable rates for the countries in which the Group operates.
The total tax charge for the year differs from the expected tax using a weighted average tax rate which reflects the applicable
statutory corporate tax rates on the accounting profits/losses in the countries in which the Group operates. The differences are
explained in the following aggregated reconciliation of the income tax expense:
2024
2023
£m
%
£m
%
Loss before tax
(44.8)
(31.9)
Expected tax (credit)/charge
(11.8)
26.3%
(6.6)
20.7%
Factors affecting the income tax expense for the year:
Expenses not deductible for tax purposes1
3.8
(8.5)%
2.8
(8.8)%
Non-taxable income
(0.4)
0.9%
(0.5)
1.6%
Impairment and disposal charges not deductible for tax purposes2
—
—
0.6
(1.9)%
Deductible temporary differences not recognised for deferred tax purposes3
11.9
(26.5)%
15.3
(48.0)%
Other adjustments in respect of previous years
0.3
(0.7)%
—
—
Effect of change in rate on deferred tax
—
—
(0.1)
0.3%
Total income tax expense
3.8
(8.5)%
11.5
(36.1)%
1. The majority of the Group’s expenses that are not deductible for tax purposes are mainly in relation to share-based payments, business entertainment, non-qualifying
depreciation and other disallowable expenditure in the current year. The expenses not deductible for tax purposes in the prior year also included acquisition related
costs and non-qualifying depreciation.
2. During the year the Group incurred impairment charges of £nil (2023: £4.2m) in relation to goodwill and non-current assets which are not deductible for tax purposes.
3. Deductible temporary differences not recognised for deferred tax purposes mainly relate to losses in the UK and Benelux and interest restricted under the UK
corporate interest restriction rules which are not recognised as deferred tax assets (see Note 22).
The effective tax rate for the Group on the total loss before tax of £44.8m (2023: £31.9m loss) is negative 8.5% (2023: negative
36.1%). The tax impact of Other items is shown in Note 2. The tax charge for the year of £3.8m (2023: £11.5m) is related
to taxable profits made in the majority of the EU businesses. Tax losses in the UK and Benelux, which cannot be surrendered or
utilised cross border, are not currently recognised as deferred tax assets (Note 22), and this impacts the overall effective tax
rate. Due to a reduction in the profit before tax of the overseas operating companies and the ongoing losses in
the UK, the Group has generated an overall loss before tax, which alongside the positive tax charge in the overseas operating
companies, has resulted in the negative effective tax rate.
Factors that will affect the Group’s future total tax charge as a percentage of underlying profits are:
–the mix of profits and losses between the tax jurisdictions in which the Group operates;
–the impact of non-deductible expenditure and non-taxable income;
–agreement of open tax computations with the respective tax authorities; and
–the recognition or utilisation (with corresponding reduction in cash tax payments) of unrecognised deferred tax assets
(see Note 22).
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6. Income tax continued
Pillar Two legislation has been enacted or substantively enacted in certain jurisdictions in which the Group operates.
The legislation is effective for the Group’s financial year beginning 1 January 2024. The Group is in scope of the enacted or
substantively enacted legislation and based on an assessment of the rules, the Pillar Two effective tax rates in most of the
jurisdictions in which the Group operates are above 15%, or one of the other transitional safe harbour reliefs are available.
Management is not currently aware of any circumstances under which this might change and therefore the Group does not
expect additional liabilities to arise as a result of Pillar Two top-up taxes.
In addition to the amounts charged to the Consolidated income statement, the following amounts in relation to taxes have
been recognised in the Consolidated statement of comprehensive income:
2024
£m
2023
£m
Deferred tax movement associated with remeasurement of defined benefit pension liabilities1
—
(0.1)
Exchange rate movements
(0.1)
0.1
Total
(0.1)
—
1. This item will not subsequently be reclassified to the Consolidated income statement.
7. Dividends
No interim dividend was paid for the year ended 31 December 2024 and no final dividend is proposed. No interim or final
dividend was proposed or paid for the year ended 31 December 2023. No dividends have been paid between 31 December
2024 and the date of signing the Financial statements.
At 31 December 2024 the Company has distributable reserves of £266.1m (2023: £145.6m) as set out in Note 12 of the
Company financial statements.
8. (Loss)/earnings per share
The calculations of (loss)/earnings per share are based on the following (losses)/profits and numbers of shares:
Basic and diluted
2024
£m
2023
£m
Loss attributable to ordinary equity holders of the parent for basic and diluted earnings per share
(48.6)
(43.4)
Add back:
Other items (Note 2)
28.9
47.8
(Loss)/profit attributable to ordinary equity holders of the parent for basic and diluted earnings
per share before Other items
(19.7)
4.4
Weighted average number of shares
2024
Number
2023
Number
For basic loss per share
1,159,276,035
1,148,348,913
Effect of dilution from share options
—
—
Adjusted for the effect of dilution
1,159,276,035
1,148,348,913
Share options are considered antidilutive in the current and prior year as their conversion into ordinary shares would decrease
the loss per share. The calculation of diluted (loss)/earnings per share does not assume conversion, exercise, or other issue of
potential ordinary shares that would have an antidilutive effect on (loss)/earnings per share.
The weighted average number of shares excludes those held by the EBT which are not vested and beneficially owned by
employees.
2024
2023
(Loss)/earnings per share
Basic and diluted loss per share
(4.2)p
(3.8)p
(Loss)/earnings per share before Other items1
Basic and diluted (loss)/earnings per share before Other items
(1.7)p
0.4p
1. (Loss)/earnings per share before Other items (also referred to as underlying (loss)/earnings per share) has been disclosed in order to present the underlying
performance of the Group.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
152
SIG Annual Report and Accounts 2024
9. Share-based payments
The Group had three share-based payment schemes in existence during the year ended 31 December 2024 (2023: three).
The Group recognised a total charge of £4.1m (2023: £5.5m) in the year relating to share-based payment transactions with a
corresponding entry to the share option reserve. The weighted average fair value of each option granted in the year was 30p
(2023: 40p). Details of each of the schemes are provided below.
a) Restricted Share Plan (“RSP”)
On 17 November 2020 the SIG plc Restricted Share Plan was approved. Under this Plan, executive directors and eligible
employees can be awarded an annual grant of restricted share awards up to a certain percentage of base salary. Restricted share
awards have no performance conditions other than the employee remaining in employment for the three year vesting period.
Restricted share awards
2024
2023
At 1 January
28,532,792
34,370,694
Granted during the year
16,700,260
12,363,081
Exercised during the year
(8,728,665)
(13,357,701)
Lapsed
(1,779,641)
(4,843,282)
At 31 December
34,724,746
28,532,792
Of the above share options outstanding at the end of the year, nil (2023: nil) were exercisable at 31 December 2024. All options
granted during the current and prior year have no exercise price. The options outstanding at 31 December 2024 therefore have
a weighted average exercise price of £nil (2023: £nil) and the options outstanding have a weighted average remaining
contractual life of 1.4 years (2023: 1.3 years). In the year, 8,728,665 options were exercised (2023: 13,357,701).
The assumptions used in the Black-Scholes model in relation to the restricted share awards granted during the year are
as follows:
21 March
2024
8 October
2024
Share price (on date of official grant)1
30p
30p
Exercise price
—
—
Expected volatility
58.2%
58.2%
Actual life
3 years
3 years
Risk free rate
4.0%
4.0%
Dividend
1.6%
1.6%
Expected percentage options to be exercised at date of grant
93%
100%
Revised expectation of percentage of options to be exercised as at 31 December 2024
88%
100%
1. Floor price set by the Remuneration Committee to determine the number of awards granted.
The weighted average fair value of RSP awards granted during 2024 was 30p (2023: 40p). The expected volatility was
determined by calculating the historical volatility of the Group’s share price over the previous five years. The expected
percentage of total options exercised is based on the directors’ best estimate for the effects of behavioural considerations.
b) Directors’ deferred shares
The following awards have been issued or accrued in relation to the Directors’ annual bonus plan, which is settled two-thirds
in cash and one-third in deferred shares. The shares are deferred for 3 years and are subject to continuous employment.
Deferred shares
2024
2023
At 1 January
3,240,264
3,086,330
Granted during the year1
695,792
260,082
Exercised during the year
(80,128)
—
Adjustment relating to final number of awards issued in relation to the prior year bonus
133,988
(106,148)
At 31 December
3,989,916
3,240,264
1. Deferred shares have been accrued in relation to the Directors’ 2024 annual bonus plan, which will be settled two-thirds in cash and one-third in deferred shares.
The deferred shares will be issued in March 2025 following finalisation of the 2024 Group results and bonus payment and the final number issued will depend on the
share price at the date of issue. The fair value of these awards used in the calculation of the share-based payment charge is 30p per share. Assumptions used in the
Black-Scholes model in relation to these awards are the same as the March 2024 RSP awards above.
Of the above awards outstanding at the end of the year, nil are exercisable at 31 December 2024. The awards have a weighted
average exercise price of £nil and the options outstanding have a weighted average remaining contractual life of 1.3 years
(2023: 1.9 years).
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9. Share-based payments continued
c) Share Incentive Plan (“SIP”)
The SIP is offered to UK employees. The SIP is a HM Revenue & Customs approved scheme and operates by inviting
participants, including Executive Directors, to purchase shares in the Company in a tax efficient manner on a monthly basis.
The Company gives one matching share for each share purchased by the employee up to a maximum of £20 each month.
No performance criteria are attached to these matching shares, other than to avoid forfeiture the participants must remain
within the plan for a minimum of three years. 494,684 matching shares were granted during the year (2023: 388,570). Given
the nature of the scheme, the fair value of the matching shares equates to the cost of the Company acquiring these shares.
10. Property, plant and equipment
The movements in the year and the preceding year were as follows:
Freehold land
and buildings
£m
Leasehold
properties
£m
Plant and
machinery
£m
Total
£m
Cost
At 1 January 2023
42.8
65.3
145.5
253.6
Exchange differences
(0.6)
(0.4)
(0.9)
(1.9)
Additions
1.3
4.9
9.2
15.4
Transfer from right-of-use assets
—
—
0.4
0.4
Reclassifications
(0.3)
0.7
(0.4)
—
Disposals
(2.0)
(0.7)
(11.9)
(14.6)
At 31 December 2023
41.2
69.8
141.9
252.9
Exchange differences
(1.7)
(1.0)
(3.2)
(5.9)
Additions
0.5
6.9
8.1
15.5
Transfer from right-of-use assets
—
—
0.2
0.2
Reclassifications
0.2
—
(0.3)
(0.1)
Disposals
(0.3)
(1.9)
(18.1)
(20.3)
At 31 December 2024
39.9
73.8
128.6
242.3
Accumulated depreciation and impairment
At 1 January 2023
22.8
46.1
115.9
184.8
Charge for the year
0.8
3.4
8.5
12.7
Impairment charges
0.5
2.3
1.6
4.4
Exchange differences
(0.4)
(0.2)
(0.6)
(1.2)
Disposals
(1.5)
(0.4)
(11.3)
(13.2)
At 31 December 2023
22.2
51.2
114.1
187.5
Charge for the year
0.7
3.7
8.1
12.5
Impairment charges
—
0.1
1.1
1.2
Exchange differences
(1.0)
(0.7)
(2.5)
(4.2)
Reclassifications
—
(0.1)
—
(0.1)
Disposals
(0.2)
(1.9)
(17.4)
(19.5)
At 31 December 2024
21.7
52.3
103.4
177.4
Net book value
At 31 December 2024
18.2
21.5
25.2
64.9
At 31 December 2023
19.0
18.6
27.8
65.4
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
154
SIG Annual Report and Accounts 2024
Leasehold properties includes leasehold improvements. Also included is a property held under a lease which is classified as an
investment property as it is no longer being occupied for use by the Group. The Group has chosen to account for investment
property using the cost model. £nil (2023: £nil) has been recognised in rental income and £nil (2023: £0.5m) incurred in Other
items during the year. The impairment in the prior year was following an assessment of recoverable value. The property is being
depreciated on a straight-line basis over the term of the lease (25 years). The property had a cost of £4.2m, accumulated
deprecation of £0.3m and impairment of £2.8m on transfer to investment property at the end of 2018. Subsequent impairments
have been recognised and the fair value of the investment property at 31 December 2024 is estimated to be £nil (2023: £nil)
based on future expected rental returns. No independent third party valuation has been carried out.
Included within additions during the year are assets in the course of construction of £3.2m (2023: £3.0m).
The impairment charge in the current year relates to branches closed as part of restructuring projects across the Group.
Property, plant and equipment balances are also included in the impairment review carried out as discussed in Note 11. The
impairment charge in the prior year comprised £0.5m in relation to the investment property as noted above, £3.6m in relation to
the impairment of the UK Interiors CGU and £0.3m in connection with restructuring across the Group.
Climate-related matters
The Group monitors the latest legislation in relation to climate-related matters. At the current time no legislation has been
passed that will have a significant impact on the useful economic life of the Group’s tangible fixed assets and the Group has not
identified any principal risks relating to climate change that are considered to have a significant impact on tangible fixed assets.
11. Goodwill
£m
Cost
At 1 January 2023
454.5
Exchange differences
(4.3)
At 31 December 2023
450.2
Exchange differences
(9.2)
At 31 December 2024
441.0
Accumulated impairment losses
At 1 January 2023
319.7
Impairment charges
2.6
Exchange differences
(3.3)
At 31 December 2023
319.0
Exchange differences
(7.0)
At 31 December 2024
312.0
Net book value
At 31 December 2024
129.0
At 31 December 2023
131.2
Goodwill acquired in a business combination is allocated at the date of acquisition to the CGUs that are expected to benefit
from that business combination. The Group currently has 11 CGUs (2023: 11). UK Interiors, Ireland and Benelux are CGUs of the
Group but do not have any associated goodwill. All CGUs have been assessed for impairment due to indicators of impairment
arising from current trading performance.
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11. Goodwill continued
Summary analysis
The carrying value of goodwill in respect of all CGUs is set out below. These are fully supported by value in use calculations as
explained below.
2024
£m
2023
£m
UK Roofing
57.4
57.4
UK Specialist Markets
2.1
2.1
Miers Construction Products
13.8
13.8
Building Solutions
11.0
11.0
France Roofing
34.1
35.8
France Interiors
5.1
5.4
Germany
4.3
4.5
Poland
1.2
1.2
Total goodwill
129.0
131.2
Impairment review process
The Group tests goodwill and the associated intangible assets and other non-current assets of CGUs annually for impairment,
or more frequently if there are indications that an impairment may be required.
The recoverable amounts of all CGUs, with the exception of UK Interiors and Benelux, are determined from value in use
calculations. The key assumptions for these calculations are those regarding discount rates, sales growth, gross margin and
operating profit growth rates. These assumptions have been revised in the year in light of the current economic environment
and recent trading performance. Discount rates represent the current market assessment of the risks specific to each CGU,
taking into consideration the time value of money and individual risks of the underlying assets that have not been incorporated
in the cash flow estimates. The discount rate calculation is based on the specific circumstances of the Group and its operating
segments and is derived from its weighted average cost of capital (WACC), including the cost of lease debt in accordance with
IFRS 16, with adjustments made to factor in the amount and timing of future tax flows in order to reflect a pre-tax discount rate.
In respect of the other assumptions, external data and management’s best estimates are applied as described below.
Value in use is determined by forecasting cash flows based upon management’s three year projections, which include forecast
sales growth based on external data (construction PMI data and construction market growth forecasts) and management’s best
estimates of market development and growth from current commercial and strategic initiatives, and gross margin assumptions
based on management’s best estimates and previous experience. Annual growth rates based upon country specific inflation
expectations (2.0%-2.5%) are applied thereafter and into perpetuity. The key assumptions used for each CGU are shown in the
table below in the Sensitivity analysis section.
Where value in use indicated an impairment, in the case of the UK Interiors and Benelux CGUs, the recoverable amount of
individual classes of assets has been determined on a fair value less costs of disposal basis. There is no goodwill in relation to
these CGUs. The key assumption used in the determination of fair value less costs of disposal is the fair value of the right-of-use
assets. For property right-of-use assets this has been determined based on third party external valuations of a number of
properties, considering the market rental value that could be obtained from subleasing the properties, subject to landlord
consent, and taking into account current market conditions together with the location and condition of the properties. For fleet
right-of-use assets, this has been determined based on the estimated recoverable value that could be obtained from returning
the vehicles early, taking into account the estimated early termination penalty compared to the future rentals remaining. For UK
Interiors there are certain lease contracts for HGV trucks where there is no right under the terms of the contract to terminate the
agreement before the end of the lease term and there is no right to sublet the vehicles, and these vehicles are therefore deemed
to have no determinable recoverable value under current contractual terms. An impairment charge is therefore recognised in
relation to these. The fair value measurement is therefore predominantly categorised within Level 2 of the fair value hierarchy,
as it is based on observable inputs for the property and fleet portfolio.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
156
SIG Annual Report and Accounts 2024
Climate-related matters
The Group monitors climate-related risks and opportunities, as described in the Principal risks and uncertainties and
Environmental, social and governance (“ESG”) sections of the Strategic report and has considered the potential impact
of climate change on the impairment review. At the current time, no legislation has been passed that will impact the key
assumptions used in the value in use calculations. The impact on revenue in terms of opportunities from continuing to expand
the Group’s product offering in energy-saving products and initiatives such as developing partnerships with suppliers to
encourage uptake of low carbon products and working with large customers such as housebuilders to support them in their
sustainability ambitions is factored into sales forecasts in the short and medium term if applicable and the impact is known as
part of bottom up forecasting procedures. The impact of transitioning the Group’s fleet to lower carbon fuel alternatives as and
when leases expire and fleet technologies evolve is also included in the forecasts where relevant, but there are no overriding
changes to key assumptions built into the forecasts at the current time. There is not considered to be a significant risk of climate
change causing a significant downturn in cashflows across the Group and therefore no specific sensitivities relating to climate
change are considered necessary over and above the sensitivities already performed below.
2024 impairment review results
The results of the impairment review carried out at 31 December 2024 indicated that an impairment of £7.3m was required
against the fleet right-of-use assets in the UK Interiors CGU. As noted above, the recoverable amount of the UK Interiors CGU
is assessed based on the fair value less costs of disposal on an asset class basis, and given that there is no right of sublet or
early settlement in accordance with the contractual terms of certain lease contracts for HGV trucks there is no determinable
recoverable value and these have been impaired to £nil. As a result, an impairment charge of £7.3m has been recognised
against right-of-use assets in the UK Interiors operating segment as at 31 December 2024 and the charge has been included
within Other items in the Consolidated income statement. Further impairment may be incurred in future periods against vehicles
acquired under similar contractual terms, until such time as the value in use calculation of the CGU as a whole exceeds the
carrying value of the assets. The carrying value of all other CGUs remains supportable.
Sensitivity analysis
A number of sensitivities have been performed on the Group’s CGUs to highlight the changes in market conditions that would
lead to the value in use equalling the carrying value. The table below sets out the amount that each assumption would have to
change by, all other assumptions remaining the same, for the carrying value of goodwill, intangible assets and property, plant
and equipment to equal recoverable amount for each CGU. UK Interiors and Benelux are not included below as they do not
have any goodwill and recoverable amount is based on fair value less costs of disposal rather than value in use. Ireland does
not have any goodwill and is therefore also not included in the analysis below.
Long-term operating profit growth has also been included in the table below in previous years. An assumption of 2.0% to 2.5%
has been used in the value in use calculations, but as this would need to be negative for each CGU for carrying value to equal
recoverable amount this is no longer disclosed as a key assumption and sensitivity.
Average revenue growth (%)
Pre-tax discount rate (%)
Gross margin (%)
2024
Headroom1
Assumption
used in value
in use
calculation2
Change
required for
carrying value
to equal
recoverable
amount3
Assumption
used in value
in use
calculation
Change
required for
carrying value
to equal
recoverable
amount
Assumption
used in value
in use
calculation
Change
required for
carrying value
to equal
recoverable
amount3
UK Roofing
£81.5m
7.1%
(9.4)%
13.7%
7.3%
27.8%
(2.2)%
UK Specialist Markets
£42.7m
12.5%
(13.0)%
13.8%
18.9%
28.7%
(3.2)%
Miers Construction Products
£7.1m
8.5%
(4.9)%
13.6%
2.1%
25.9%
(1.1)%
Building Solutions
£20.1m
10.8%
(11.7)%
13.1%
7.7%
25.9%
(2.6)%
France Interiors
£69.0m
4.4%
(15.0)%
13.8%
41.7%
28.0%
(3.8)%
France Roofing
£30.8m
2.9%
(4.2)%
13.6%
3.4%
24.1%
(0.8)%
Germany
£82.5m
6.4%
(9.2)%
13.4%
12.6%
28.3%
(2.0)%
Poland
£48.9m
8.1%
(16.6)%
15.3%
15.4%
20.2%
(2.3)%
1. Compared to carrying value of goodwill, intangible assets, property, plant and equipment and right-of-use assets.
2. Average growth per annum over each of the three years.
3. The change required is the % reduction required in each of the three years.
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11. Goodwill continued
The changes required represent the absolute change required to the assumption % used in the value in use calculation.
Of the above sensitivities for 2024, management considers the % change in revenue and gross margin for the Miers and France
Roofing CGUs, and the % change in revenue for the UK Specialist Markets and Building Solutions CGUs, to be reasonably
possible scenarios, given current uncertainties regarding market demand and the forecast revenue growth included in the
forecasts. The other % changes in assumptions shown above are not considered to be reasonably possible scenarios, but this
additional voluntary information over and above that required by IAS 36 has been included in order to provide a full picture of
the level of headroom and sensitivity to changes in assumptions for each CGU.
The forecasts used in the 2024 impairment review take into account management’s best estimate of future cash flows, reflecting
the trading levels experienced during the year, current economic conditions and best estimates of inflation and demand.
The Board has actively reviewed the forecasts associated with the CGUs noting the assumptions used, the sensitivity analysis
performed and the ability of the businesses to adapt to challenging economic environments in which they operate, and is
satisfied that no further impairments are necessary at 31 December 2024.
2023 impairment review results and sensitivity analysis
The results of the impairment review carried out at 31 December 2023 indicated that the carrying value of goodwill and other
assets associated with the UK Interiors CGU was not supportable, following the split out of the UK Specialists Markets CGU
combined with the downturn in performance in the year and associated reduction in future forecast cash flows. As a result, an
impairment charge of £33.8m was recognised at 31 December 2023, which was allocated against goodwill (£2.6m), intangible
assets (£2.2m), tangible fixed assets (£3.6m) and right-of-use assets (£25.4m), and the charge was included within Other items
in the Consolidated income statement. The recoverable amount of the CGU was £86.5m, based on the value in use calculation.
The carrying value of all other CGUs remained supportable.
A number of sensitivities were performed on the Group’s CGUs to highlight the changes in market conditions that would have
led to the value in use equalling the carrying value. The table below sets out the amount that each assumption would have had
to change by, all other assumptions remaining the same, for the carrying value of goodwill, intangible assets and property, plant
and equipment to equal recoverable amount for each CGU. The UK Interiors CGU was impaired to recoverable amount based
on the assumptions applied, therefore any change in a key assumption would have caused further impairment of the carrying
value of non-current assets for this CGU. Separate analysis is provided below of the key assumptions applied in the calculation
of recoverable amount and the additional impairment that could have arisen from a reasonably possible change in assumption.
Benelux is not included below as it does not have any goodwill, and recoverable amount was based on fair value less costs of
disposal rather than value in use. Ireland does not have any goodwill and is therefore also not included in the analysis below.
Average revenue growth (%)
Pre-tax discount rate (%)
Gross margin (%)
2023
Headroom1
Assumption
used in value
in use
calculation2
Change
required for
carrying value
to equal
recoverable
amount3
Assumption
used in value
in use
calculation
Change
required for
carrying value
to equal
recoverable
amount
Assumption
used in value
in use
calculation
Change
required for
carrying value
to equal
recoverable
amount3
UK Roofing
£37.5m
6.9%
(4.5)%
14.0%
3.3%
28.2%
(1.1)%
UK Specialist Markets
£20.3m
8.7%
(6.8)%
14.3%
8.3%
30.5%
(1.7)%
Miers Construction Products
£11.7m
6.9%
(8.0)%
14.3%
3.7%
27.6%
(1.9)%
Building Solutions
£9.1m
8.1%
(5.4)%
13.5%
3.6%
26.2%
(1.2)%
France Interiors
£87.1m
5.4%
(16.0)%
13.6%
55.8%
29.0%
(4.2)%
France Roofing
£111.0m
6.7%
(11.7)%
13.3%
10.5%
24.5%
(2.4)%
Germany
£76.9m
5.8%
(7.8)%
13.6%
13.0%
28.7%
(1.8)%
Poland
£80.4m
7.4%
(24.1)%
14.6%
24.6%
20.4%
(3.5)%
1. Compared to carrying value of goodwill, intangible assets, property, plant and equipment and right-of-use assets.
2. Average growth per annum over three years.
3. The change required is the % reduction required in each of the three years.
The changes required represent the absolute change required to the assumption % used in the value in use calculation.
Of the above sensitivities for 2023, management considered the % change in revenue to be a reasonably possible scenario for
the UK Exteriors CGU, and the % changes in revenue and gross margin to be reasonably possible scenarios for the Building
Solutions CGU, given uncertainties regarding market demand and inflation. The other % changes in assumptions shown above
were not considered to be reasonably possible scenarios, but this additional voluntary information over and above that required
by IAS 36 was included in order to provide a full picture of the level of headroom and sensitivity to changes in assumptions for
each CGU. For the UK Interiors CGU, recoverable amount was based on average revenue growth per annum over the three
years of 5.1%, gross margin of 22.2%, discount rate of 15.1% and long term growth rate of 2.0%. As the CGU was impaired to
recoverable value, any change in assumption would have caused further impairment. A 2% reduction in revenue in each year
would have led to further impairment of £18.3m.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
158
SIG Annual Report and Accounts 2024
12. Intangible assets
The intangible assets presented below relate to acquired intangibles that arise as a result of applying IFRS 3 “Business
Combinations” (which requires the separate recognition of acquired intangibles from goodwill) and computer software
which is recognised separately from associated hardware.
Customer
relationships
£m
Non-compete
clauses
£m
Computer
software
£m
Total
£m
Cost
At 1 January 2023
225.2
11.7
43.8
280.7
Additions
—
—
0.3
0.3
Disposals
—
—
(14.2)
(14.2)
Exchange differences
(0.1)
—
(0.1)
(0.2)
At 31 December 2023
225.1
11.7
29.8
266.6
Additions
—
—
0.6
0.6
Disposals
—
(11.7)
(11.1)
(22.8)
Exchange differences
(0.1)
—
(0.4)
(0.5)
At 31 December 2024
225.0
—
18.9
243.9
Amortisation
At 1 January 2023
207.3
11.7
38.9
257.9
Charge for the year
2.8
—
2.4
5.2
Impairment charges
2.2
—
0.3
2.5
Disposals
—
—
(14.2)
(14.2)
Exchange differences
—
—
(0.1)
(0.1)
At 31 December 2023
212.3
11.7
27.3
251.3
Charge for the year
2.1
—
1.2
3.3
Disposals
—
(11.7)
(11.1)
(22.8)
Exchange differences
—
—
(0.4)
(0.4)
At 31 December 2024
214.4
—
17.0
231.4
Net book value
At 31 December 2024
10.6
—
1.9
12.5
At 31 December 2023
12.8
—
2.5
15.3
Amortisation of acquired intangibles is included in the Consolidated income statement as part of operating expenses and is
classified within Other items.
The average amortisation period for each category of intangible asset is disclosed in the Accounting policies. Non-compete
clauses have been fully amortised for a number of years. The cost and accumulated amortisation is no longer considered
meaningful and the amounts are therefore shown as a disposal in the current year.
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13. Acquisitions
The Group has not made any business acquisitions during the current or prior year. Certain amounts of deferred and contingent
consideration in relation to previous acquisitions remained payable at 31 December 2023 and 2024, and a reconciliation of the
movement in each of these balances during the year is shown below.
Deferred consideration
A reconciliation of the movement in deferred consideration is provided below:
2024
£m
2023
£m
Liability at 1 January
1.8
2.5
Amounts paid relating to previous acquisitions (included within cash flow from investing activities)
(1.8)
(0.7)
Liability at 31 December
—
1.8
Included in current liabilities
—
1.8
Total
—
1.8
Contingent consideration
A reconciliation of the movement in the fair value measurement of contingent consideration is provided below:
2024
£m
2023
£m
Liability at 1 January
3.1
3.0
Amounts paid relating to previous acquisitions (included within cash flow from investing activities)
(2.6)
—
Unrealised fair value changes recognised in profit or loss
—
0.1
Liability at 31 December
0.5
3.1
Included in current liabilities (within accruals and other payables)
0.5
3.1
Total
0.5
3.1
Consideration dependent on vendors remaining within the business
Amounts which may be paid to vendors of recent acquisitions who are employed by the Group and are contingent upon the
vendors remaining within the business are, as required by IFRS 3 “Business Combinations”, treated as remuneration and
charged to the Consolidated income statement as earned. A reconciliation of the movement in amounts accrued is as follows:
2024
£m
2023
£m
Liability at 1 January
4.0
1.2
New amounts accrued
—
2.8
Amounts paid (included within cash flow from operating activities)
(4.0)
—
Liability at 31 December
—
4.0
Included in current liabilities (within accruals and other payables)
—
4.0
Total
—
4.0
14. Inventories
2024
£m
2023
£m
Raw materials and consumables
8.1
6.4
Work in progress
0.9
1.7
Finished goods and goods for resale
244.8
251.0
Total
253.8
259.1
The estimated replacement cost of inventories is not materially different from the balance sheet value stated above.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
160
SIG Annual Report and Accounts 2024
15. Trade and other receivables
2024
£m
2023
£m
Trade receivables
271.0
291.5
VAT
3.3
2.9
Other receivables
7.0
6.5
Prepayments and accrued income
89.5
88.2
Trade and other receivables
370.8
389.1
Lease receivables (Note 23)
0.3
1.1
Current tax assets
2.3
3.6
Total current receivables
373.4
393.8
Included within prepayments and accrued income is £71.7m (2023: £70.4m) due in relation to supplier rebates where there is
no right to offset against trade payable balances. The remainder of the balance relates to prepayments.
Trade receivables are non-interest bearing and are generally on terms which range from 8 to 60 days from end of month.
Trade receivables are stated net of allowance for estimated credit losses and provisions for sales credit notes and customer
rebates. An allowance has been made for estimated credit losses from trade receivables of £18.4m at 31 December 2024
(2023: £20.0m).
Movement in the allowance for expected credit losses
2024
£m
2023
£m
At 1 January
(20.0)
(19.1)
Utilised
5.1
3.8
Unused amounts released to the Consolidated income statement
3.9
3.1
Charged to the Consolidated income statement
(7.9)
(7.7)
Exchange differences
0.5
(0.1)
At 31 December
(18.4)
(20.0)
The Group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss
allowance for all trade receivables and contract assets.
The expected loss rates have been assessed by each operating segment and are based on the payment profiles of sales over
a period prior to 31 December 2024, the availability of credit insurance and the historical credit losses experienced within this
period. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors
affecting the ability of the customers to settle the receivables and any change in the credit quality of the trade receivable from
the date credit was initially granted up to the reporting date and makes a provision for impairment accordingly. In calculating
expected credit losses, a loss is either a debt written off or overdue by more than 12 to 24 months depending on the business
and/or expected likelihood of recovery. Debts are generally written off following official notice of insolvency, conclusion of legal
proceedings or when there is no reasonable expectation of recovery. Expected credit loss provisions have been adjusted where
relevant to take account of experience during the year and forward looking information.
The total impairment loss relating to trade receivables recognised in the Consolidated income statement is £5.8m (2023: £9.6m).
At 31 December 2024
Days past due
< 30 days
£m
30-60 days
£m
61-90 days
£m
> 91 days
£m
Total
£m
Expected credit loss rate
1.4%
7.5%
20.0%
55.2%
Total gross carrying amount
265.0
26.7
5.0
21.0
317.7
Expected credit loss
3.8
2.0
1.0
11.6
18.4
At 31 December 2023
Days past due
< 30 days
£m
30-60 days
£m
61-90 days
£m
> 91 days
£m
Total
£m
Expected credit loss rate
1.6%
7.2%
20.3%
53.1%
Total gross carrying amount
283.1
29.3
6.9
22.6
341.9
Expected credit loss
4.5
2.1
1.4
12.0
20.0
The Directors consider that the carrying amount of trade and other receivables approximates to their fair value.
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15. Trade and other receivables continued
Included within trade receivables is a managed pool of customer balances of £50.0m (2023: £51.6m) pledged as security in
relation to the asset backed funding arrangement implemented in relation to the UK defined benefit pension plan. See Note 28
for further details.
Transfer of trade receivables
Consistent with previous years, the Group sold without recourse trade receivables to banks and other financial institutions for
cash proceeds. These trade receivables of £32.3m (2023: £40.1m) have been derecognised from the Consolidated balance
sheet, because the Group has transferred the risks and rewards.
Credit risk management
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group.
Trade receivable credit exposure is controlled by counterparty limits that are set, reviewed and approved by operational
management on a regular basis.
Trade receivables consist of a large number of typically small to medium sized customers, spread across a number of different
market sectors and geographical areas. Ongoing credit evaluation is performed on the financial condition of accounts
receivable and to determine whether the credit risk has increased since initial recognition. Where appropriate, credit guarantee
insurance cover is purchased.
The Group does not have any significant credit risk exposure to any single customer, with no single customer representing more
than 1% of the Group’s revenue.
16. Current liabilities
2024
£m
2023
£m
Trade payables
254.7
253.3
VAT
8.6
11.3
Social security and payroll taxes
13.4
15.8
Accruals and other payables
81.9
105.4
Trade and other payables
358.6
385.8
Lease liabilities (Note 23)
64.9
64.9
Interest-bearing loans and borrowings (Note 17)
5.2
0.8
Deferred consideration (Note 13)
—
1.8
Derivative financial instruments
1.3
1.0
Current tax liabilities
1.7
6.9
Provisions (Note 21)
7.6
7.9
Current liabilities
439.3
469.1
Trade payables is presented net of £37.4m (2023: £36.5m) due from suppliers in respect of supplier rebates where the Group
has the right to net settlement. Trade payables, accruals and other payables principally comprise amounts outstanding for trade
purchases and ongoing costs.
One of the Group’s subsidiaries in France has a supplier finance arrangement in place that is offered to some of its suppliers,
up to a maximum of €4.5m. Participation in the arrangement is at the suppliers’ discretion and helps suppliers obtain affordable
credit. Suppliers that choose to take advantage of the supplier finance arrangement receive early payment on invoices sent by
the subsidiary to the external finance provider, for which the supplier pays a fee to the external finance provider. The subsidiary
settles the original invoice amount by paying the finance provider in line with the original invoice payment terms. Another
subsidiary in France has provided a guarantee to the finance provider in relation to amounts paid by the finance provider and
not yet settled by the subsidiary. Trade payables subject to the supplier finance arrangement are included in trade payables
above. The carrying amount of trade payables that are part of the supplier finance arrangement at 31 December 2024 is £2.7m
(2023: £2.9m). Of this amount, suppliers have already received payment from the finance provider of £2.2m (2023: £2.8m).
Payment due dates for both the trade payable amounts that are part of the supplier finance arrangement and other trade
payables of the relevant subsidiary range from 15 to 75 days from the balance sheet date. There were no significant non-cash
changes in the carrying amount of the trade payables included in the supplier finance arrangement.
Of the above balances, the lease liability contracts are secured on the underlying assets and the remaining balances are unsecured.
The Directors consider that the carrying amount of current liabilities approximates to their fair value.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
162
SIG Annual Report and Accounts 2024
17. Interest-bearing loans and borrowings
2024
£m
2023
£m
Current interest-bearing loans and borrowings
Lease liabilities (Note 23)
64.9
64.9
Bank loan
0.8
0.8
Accrued interest on secured notes1
4.4
—
Total current interest-bearing loans and borrowings
70.1
65.7
Non-current interest-bearing loans and borrowings
Lease liabilities (Note 23)
258.7
264.9
Secured notes
256.4
258.7
Bank loan
0.5
1.3
Total non-current interest-bearing loans and borrowings
515.6
524.9
Total interest-bearing loans and borrowings
585.7
590.6
Secured notes
In October 2024 the Group completed a refinancing of its debt arrangements. The previous €300m secured notes (fixed coupon
5.25% due November 2026) were tendered, at par, with €286.5m repaid, leaving €13.5m outstanding, and €300m new secured
notes were issued with a fixed coupon of 9.75%, due October 2029. The notes are guaranteed by certain subsidiaries of the
Group and are secured by a first priority floating charge over the assets of the Company and the relevant UK subsidiaries
and by a security interest over the shares, material bank accounts and intercompany receivables of the non-UK guarantor
subsidiaries. The notes are recognised at amortised cost, net of arrangement fees, of which £2.7m is unamortised at
31 December 2024 (2023: £1.5m). The notes are subject to incurrence based covenants only.
The contractual repayment profile of the secured notes is shown below:
2024
2023
£m
Fixed interest
rate%
£m
Fixed interest
rate%
Gross amount repayable in 2026
11.2
5.25%
260.2
5.25%
Gross amount repayable in 2029
247.9
9.75%
—
—
Unamortised fees
(2.7)
(1.5)
Secured notes due after more than one year
256.4
258.7
Accrued interest repayable within one year1
4.4
—
Total secured notes
260.8
258.7
1. Accrued interest on the secured notes of £1.1m was included within accruals and other payables at 31 December 2023. Following the change in timing of
payment and increase in amount as a result of the refinancing in October 2024 this is now presented separately within interest-bearing loans and borrowings
at 31 December 2024.
Bank loan
The bank loan was acquired during 2022 as part of the Miers business acquisition. The loan is repayable in equal monthly
instalments until June 2026, incurs interest at 2.25% above base rate and is secured by way of a fixed and floating charge over
certain assets of the Miers business.
Committed facilities
The Group also has undrawn committed borrowing facilities at 31 December 2024 as follows:
2024
£m
2023
£m
Revolving credit facility expiring April 2029
90.0
—
Revolving credit facility expiring May 2026
—
90.0
Total
90.0
90.0
The RCF facility of £90m was amended and restated as part of the refinancing in October 2024 and is now committed until
April 2029. The RCF is undrawn at 31 December 2024. The RCF has a leverage maintenance covenant which is only effective
if the facility is over 40% drawn at a quarter end reporting date.
The fair value of borrowings is disclosed in Note 18.
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18. Financial assets, liabilities, financial risk management and derivatives
The Group’s principal financial liabilities, other than derivatives, comprise loans and borrowings, lease liabilities, deferred
consideration and trade and other payables. The main purpose of these financial liabilities is to finance the Group’s operations.
The Group’s principal financial assets include trade receivables and cash and cash equivalents that derive directly from its
operations.
a) Financial assets
The Group holds the following financial assets:
Note
2024
£m
2023
£m
Financial assets at amortised cost:
Trade receivables
15
271.0
291.5
Cash at bank and on hand
87.4
132.2
Financial asset at fair value through OCI:
Unquoted equity investment
0.2
0.2
Derivative financial instruments designated as hedging instruments
18d
0.2
—
Total
358.8
423.9
The interest received on cash deposits is at variable rates of interest of up to 5.26% (2023: 5.25%). Of the cash at bank and on
hand of £87.4m, £0.6m is required to be held to cover bank guarantees issued to third parties and is therefore restricted for use
by the Group.
The Directors consider that the fair values of cash at bank and on hand and trade receivables approximate to their carrying
value, largely due to the short-term maturities of these instruments. The fair value is not significantly different to the carrying
amount.
The Group’s credit risk on liquid funds and derivative financial instruments is limited because the counterparties are banks with
high credit ratings assigned by international credit rating agencies. Information about the Group’s exposure to credit risk in
relation to trade receivables is given in Note 15.
Of the above cash at bank on hand, £8.1m (2023: £10.5m) is denominated in sterling, £70.7m (2023: £107.4m) in euros, £7.7m
(2023: £13.6m) in Polish zloty, and £0.9m (2023: £0.7m) in other currencies.
The financial asset at fair value through OCI is an investment in equity shares of a non-listed company. The Group holds a
non-controlling interest of 17% in the company. The investment is designated at fair value through OCI as it is considered
strategic in nature.
b) Financial liabilities
The Group holds the following financial liabilities:
Note
2024
£m
2023
£m
Financial liabilities at amortised cost
Trade and other payables1
16
336.6
358.7
Interest-bearing loans and borrowings
17
262.1
260.8
Deferred consideration
13
—
1.8
Lease liabilities
23
323.6
329.8
Derivative financial instruments designated as hedging instruments
18d
1.4
1.1
Total
923.7
952.2
1. Excluding non-financial liabilities.
The directors consider that the fair values of trade and other payables are approximate to their carrying value due to their
short-term nature. The fair value of borrowings and other financial liabilities is considered below.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
164
SIG Annual Report and Accounts 2024
2024 interest rate and currency profile
The interest rate and currency profile of the Group’s financial liabilities at 31 December 2024, excluding prepayment of
arrangement fees of £2.7m was as follows:
Currency
Total
£m
Floating rate
£m
Fixed rate
£m
Effective fixed
interest rate
%
Weighted
average time
for which rate
is fixed
Years
Amount
secured
£m
Amount
unsecured
£m
Lease contracts
Sterling
160.1
—
160.1 1.7%-12.7%
8.3
160.1
—
Bank loan
Sterling
1.3
1.3
—
n/a
n/a
1.3
—
Secured notes
Euro
11.2
—
11.2
5.25%
1.9
11.2
—
Secured notes
Euro
252.3
—
252.3
9.75%
4.9
252.3
—
Lease contracts
Euro
147.3
—
147.3 0.7%-15.4%
5.5
147.3
—
Lease contracts
Polish zloty
16.2
6.3
9.9 2.1%-17.9%
6.4
16.2
—
Total
588.4
7.6
580.8
588.4
—
All of the above lease contracts are secured on the underlying assets.
The Directors consider the fair value of the Group’s floating rate financial liabilities to be materially approximate to the book value
shown in the table above. The fair value of the Group’s secured notes at 31 December 2024 is assessed at £261.3m (2023:
£234.0m) based on quoted market prices and is classified as a Level 1 fair value measurement for disclosure purposes. The
remaining fixed rate debt amounts to £317.3m (2023: £324.0m) and relates to lease contracts. The Directors consider the fair
value of this remaining fixed rate debt to be materially approximate to the book value shown above.
2023 interest rate and currency profile
The interest rate and currency profile of the Group’s financial liabilities at 31 December 2023, excluding prepayment of
arrangement fees of £1.5m and deferred consideration of £1.8m was as follows:
Currency
Total
£m
Floating rate
£m
Fixed rate
£m
Effective fixed
interest rate
%
Weighted
average time
for which rate
is fixed
Years
Amount
secured
£m
Amount
unsecured
£m
Lease contracts
Sterling
168.1
—
168.1
1.7%-12.7%
8.8
168.1
—
Bank loan
Sterling
2.1
2.1
—
n/a
n/a
2.1
—
Secured notes
Euro
260.2
—
260.2
5.25%
2.9
260.2
—
Lease contracts
Euro
149.1
—
149.1
0.7%-15.4%
5.8
149.1
—
Lease contracts
Polish zloty
12.6
5.8
6.8
2.1%-17.9%
6.1
12.6
—
Total
592.1
7.9
584.2
592.1
—
All of the above lease contracts are secured on the underlying assets.
In both 2024 and 2023, the interest rate on floating rate financial liabilities is based upon appropriate local market rates.
c) Financial risk management
The Group’s finance and treasury policies set out the Group’s approach to managing treasury risk. The objectives of the
Group’s financial risk management policies are to ensure sufficient liquidity to meet the Group’s operational and strategic
needs and the management of financial risk at optimal cost.
The Group is exposed to credit risk, liquidity risk, interest rate risk and foreign currency risk. The Group Board oversees the
management of these risks. The Board manages the risks through implementation of the Group treasury policy, supported by
the Group Tax and Treasury Committee, which monitors and reviews the activities of the Group treasury function to ensure they
are performed in accordance with the policy and reports to the Group Board on a regular basis. It is Group policy that no
trading in financial instruments or speculative transactions be undertaken.
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18. Financial assets, liabilities, financial risk management and derivatives continued
Liquidity risk
Liquidity risk is the risk that the Group is unable to meet its financial obligations as they fall due. In order to minimise this risk,
the Group seeks to balance certainty of funding and a flexible, cost-effective borrowing structure. The key sources of finance
are note holders, being professional institutional investors, and a revolving credit facility with principal banks. The Group also
maintains significant cash balances which are more than sufficient to meet the requirements of the working capital cycle taking
into account the seasonality of the business.
To manage liquidity risk the Group prepares and reviews rolling weekly cash flow forecasts, actual cash and debt positions
along with available facilities and headroom, which are reported weekly and monitored by Group management. In addition, full
annual three-year forecasts are prepared including cash flow and headroom forecasts. The Group is in a strong liquidity position
and at 31 December 2024 held cash of £87.4m (2023: £132.2m), and had £90.0m (2023: £90.0m) additional headroom from the
RCF that matures in April 2029. The RCF is subject to a leverage maintenance covenant, currently set at 6.5x, reducing to 5.5x
from 31 March 2026 and 5.0x from 31 March 2027, which is effective if the facility is over 40% (i.e. £36m) drawn at a quarter end
reporting date.
Foreign currency risk
The Group has a number of overseas businesses whose revenues and costs are denominated in the currencies of the countries
in which they operate. 58% of the Group’s 2024 continuing revenues (2023: 58%) were in foreign currencies, being primarily
euros and Polish zloty. The Group faces a translation risk in respect of changes to the exchange rates between the reporting
currencies of these operations and sterling and has decided not to hedge the income statement translational risk arising from
these income streams.
The Consolidated balance sheet of the Group is inherently exposed to movements in the sterling value of its net investments in
foreign businesses. For currencies where the Group has significant exposure, the Group seeks to hold financial liabilities and
derivatives in the same currency to partially hedge the net investment values.
The Group uses foreign exchange forward contracts to manage the exposures arising from cross currency transactions
(Note 18d ii).
Overseas earnings streams are translated at the average rate of exchange for the year whilst balance sheets are translated
using closing rates. The table below sets out the principal exchange rates used:
Average rate
Closing rate
2024
2023
Movement (%)
2024
2023
Movement (%)
Euro
1.184
1.152
2.8%
1.210
1.153
4.9%
Polish zloty
5.096
5.214
(2.3)%
5.176
5.012
3.3%
Commodity risk
The nature of the Group’s operations creates an ongoing demand for fuel and therefore the Group is exposed to movements in
market fuel prices. The Group currently has no commodity derivative contracts in place.
Credit risk
Credit risk is covered in Note 15.
Counterparty credit risk
SIG holds significant investment assets, being principally cash deposits and derivative assets. Strict policies are in place in
order to minimise counterparty credit risk associated with these assets. A list of approved deposit counterparties is maintained
and counterparty credit limits, based on published credit ratings, are in place. These limits, and the position against these limits,
are reviewed and reported on a regular basis.
Interest rate risk
The Group has exposure to movements in interest rates on its outstanding debt, financial derivatives and cash balances.
To reduce this risk the Group monitors its mix of fixed and floating rate debt and, if required, transacts derivative financial
instruments to manage this mix where appropriate. The Group has a policy of aiming to fix at least 50% of its average net debt
over the medium term. The percentage of gross debt at fixed rates of interest at 31 December 2024 is 98.8% (2023: 98.7%).
The percentage of available gross debt at fixed rates of interest at 31 December 2024 (including the undrawn RCF) is 85.6%
(2023: 85.7%).
d) Hedging activities and derivatives
The Group is exposed to foreign currency and interest rate risks relating to its ongoing business operations. In order to manage
the Group’s exposure to exchange rate changes, the Group utilises currency derivative financial instruments. The fair values of
these derivative financial instruments are calculated by discounting the associated future cash flows to net present values using
appropriate market rates prevailing at the balance sheet date.
The Group does not trade in derivative financial instruments for speculative purposes. Where derivatives meet the hedge
accounting criteria under the rules of IFRS 9, movements in the fair values of these derivative financial instruments are
recognised in the Consolidated statement of comprehensive income. Where the criteria for hedge accounting are not met,
movements are accounted for at fair value through profit or loss. Financial instruments are presented as current assets or
liabilities to the extent they are expected to be settled within 12 months after the end of the reporting period.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
166
SIG Annual Report and Accounts 2024
The Group is required to analyse financial instruments that are measured subsequent to initial recognition at fair value, grouped
into Levels 1 to 3 based on the degree to which the fair value is observable:
–Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets
or liabilities.
–Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
–Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that
are not based on observable market data (unobservable inputs).
All of the financial instruments below are categorised as Level 2.
i) Net investment hedges
The Group has investments in euro denominated subsidiaries. At 31 December 2024 the Group held €313.5m (2023: €300.0m)
of direct euro denominated debt through its secured notes. This borrowing is being used to hedge the Group’s exposure to the
euro foreign exchange risk on investments in euro denominated subsidiaries. Gains or losses on retranslation of the borrowing
are transferred to OCI to offset any gains or losses on translation of the net investments in the subsidiaries.
There is an economic relationship between the hedged item and the hedging instruments as the net investment in euro
denominated assets creates a translation risk that will match the foreign exchange risk on the euro denominated debt.
The Group has established a hedge ratio of 1:1 as the underlying risk of the hedging instrument is identical to the hedged
risk component. Hedge ineffectiveness will arise when the amount of the investment in euro denominated subsidiaries
becomes lower than the amount of the euro denominated debt.
The impact of the hedging instruments on the Consolidated balance sheet is as follows:
Notional
amount
€m
Carrying
amount
(liability)
£m
Line item in the
Consolidated balance sheet
Change in fair value
used for measuring
ineffectiveness for the period
£m
At 31 December 2024
Foreign currency
denominated borrowing
313.5
259.1
Interest-bearing loans
and borrowings
12.3
At 31 December 2023
Foreign currency
denominated borrowing
300.0
260.2
Interest-bearing loans
and borrowings
5.8
The impact of the hedged item on the Consolidated balance sheet is as follows:
31 December 2024
31 December 2023
Change in fair value
used for measuring
ineffectiveness
£m
Foreign currency
translation reserve
£m
Cost of hedging
reserve
£m
Change in fair value
used for measuring
ineffectiveness
£m
Foreign currency
translation reserve
£m
Cost of hedging
reserve
£m
Net investment in
foreign subsidiaries
12.3
12.3
—
5.8
5.8
—
The hedging gain recognised in Other comprehensive income is equal to the change in fair value used for measuring
effectiveness. There is no ineffectiveness recognised in profit or loss.
ii) Cash flow hedges
With regard to cash flow hedges, the effective portion of the gain or loss on the hedging instrument is recognised in equity and
is subsequently removed and included in the Consolidated income statement within finance costs in the same period that the
hedged item affects the Consolidated income statement.
Foreign currency risk
The Group uses foreign exchange forward contracts to manage the exposures arising from cross currency transactions.
At 31 December 2024 the Group held a number of short term forward contracts designated as hedging instruments in cash
flow hedges of forecast purchases in US dollars and euros. The forecast transactions are highly probable. Foreign exchange
forward contract balances vary with the level of expected foreign currency transactions and changes in foreign exchange
forward rates.
Included within derivative financial instruments is a £1.2m net liability (2023: £1.1m liability) relating to forward foreign exchange
contracts.
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18. Financial assets, liabilities, financial risk management and derivatives continued
The Group is holding the following foreign exchange forward contracts:
Notional
amount
$m
Notional
amount
€m
Notional
amount
£m
Maturity
Average
hedged rate
Average
forward rate
At 31 December 2024
12.4
75.4
73.8 2025 & 2026
n/a
0.82
At 31 December 2023
14.3
62.6
67.0 2024 & 2025
n/a
1.18
The impact of the hedging instruments on the Consolidated balance sheet is as follows:
Carrying
amount
(liability)
£m
Line item in the
Consolidated balance sheet
Change in fair value
used for measuring
ineffectiveness for the period
£m
At 31 December 2024
Foreign exchange forward contracts
(1.2)
Derivative financial
instruments
(1.1)
At 31 December 2023
Foreign exchange forward contracts
(1.1)
Derivative financial
instruments
(1.1)
The impact of the hedged item on the Consolidated balance sheet is as follows:
31 December 2024
31 December 2023
Change in fair value
used for measuring
ineffectiveness
£m
Cash flow
hedging reserve
£m
Cost of
hedging reserve
£m
Change in fair value
used for measuring
ineffectiveness
£m
Hedging and
translation reserve
£m
Cost of
hedging reserve
£m
Foreign exchange
forward contracts
(1.1)
(1.1)
—
(1.1)
(1.1)
—
The effect of the cash flow hedges on the Consolidated income statement and Consolidated statement of other comprehensive
income is as follows:
Total hedging
gain/(loss)
recognised in
OCI
£m
Ineffectiveness
recognised in
profit or loss
£m
Line item in the
Consolidated
income statement
Amount
reclassified
from OCI to
profit or loss
£m
Line item in the
Consolidated
income statement
At 31 December 2024
Foreign exchange forward contracts
(1.1)
—
Finance costs
1.0
Operating
expenses
At 31 December 2023
Foreign exchange forward contracts
(1.1)
—
Finance costs
(1.5)
Operating
expenses
Derivatives not designated as hedging instruments
The Group held no foreign exchange forward contracts at 31 December 2024 or 2023 which are not designated as cash flow
hedges to manage some of its transaction exposures and are entered into for periods consistent with foreign currency exposure
of the underlying transactions, generally within one month.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
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SIG Annual Report and Accounts 2024
iii) Impact of hedging on equity
Set out below is the reconciliation of each component of equity and the analysis of other comprehensive income:
Retained profits/(losses)
Cash flow hedging reserve
Foreign currency
translation reserve
Cost of hedging reserve
2024
£m
2023
£m
2024
£m
2023
£m
2024
£m
2023
£m
2024
£m
2023
£m
At 1 January
17.6
60.0
(1.0)
1.6
4.8
2.9
0.1
0.1
Effective portion of
changes in fair value
arising from:
Foreign exchange
forward contracts
—
—
(1.1)
(1.1)
—
—
—
—
Amount reclassified to
profit or loss
—
—
1.0
(1.5)
—
—
—
—
Foreign currency
revaluation of foreign
currency denominated
borrowing
—
—
—
—
12.3
5.8
—
—
Foreign currency
revaluation of net
foreign operations
—
—
—
—
(15.3)
(3.9)
—
—
Tax effect
—
—
—
—
—
—
—
—
Other movements not
associated with
hedging
(48.8)
(42.4)
—
—
—
—
—
—
At 31 December
(31.2)
17.6
(1.1)
(1.0)
1.8
4.8
0.1
0.1
The following table reconciles the net losses on derivative financial instruments recognised directly in the Consolidated income
statement, to the movements in derivative financial instruments noted above.
2024
£m
2023
£m
Losses on derivative financial instruments recognised directly in the Consolidated income statement
—
(0.1)
Amounts reclassified from OCI to profit and loss on cash flow hedges
(1.0)
1.5
Total net (losses)/gains on derivative financial instruments included in the Consolidated
income statement
(1.0)
1.4
19. Maturity of financial assets and liabilities
Maturity of financial liabilities
The maturity profile of the Group’s financial liabilities (inclusive of derivative financial assets) at 31 December 2024 was as follows:
2024
£m
2023
£m
In one year or less
71.3
68.5
In more than one year but not more than two years
65.8
55.5
In more than two years but not more than five years
367.0
373.2
In more than five years
82.8
96.3
Total
586.9
593.5
The table excludes trade and other payables of £336.6m (2023: £358.7m).
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19. Maturity of financial assets and liabilities continued
Contractual maturity analysis of the Group’s financial liabilities, derivative financial instruments,
other financial assets, deferred consideration and cash and cash equivalents
IFRS 7 requires disclosure of the maturity of the Group’s remaining contractual financial liabilities. The tables below have been
drawn up based on the undiscounted contractual maturities of the Group’s financial assets and liabilities including interest that
will accrue to those assets and liabilities except where the Group is entitled and intends to repay the liability before its maturity.
Both the inclusion of future interest and the values disclosed being undiscounted results in the total position being different to
that included in the Consolidated balance sheet.
Maturity analysis
2024 Analysis
Balance sheet
value
£m
< 1 year
£m
1-2 years
£m
2-5 years
£m
> 5 years
£m
Total
£m
Current liabilities
Trade and other payables
336.6
336.6
—
—
—
336.6
Lease liabilities
64.9
74.3
—
—
—
74.3
Interest-bearing loans
5.2
5.3
—
—
—
5.3
Derivative financial instruments
1.3
1.3
—
—
—
1.3
Total
408.0
417.5
—
—
—
417.5
Non-current liabilities
Lease liabilities
258.7
—
63.8
133.3
100.3
297.4
Interest-bearing loans
0.5
—
0.5
—
—
0.5
Secured notes
256.4
22.8
35.9
320.5
—
379.2
Derivative financial instruments
0.1
—
0.1
—
—
0.1
Total
515.7
22.8
100.3
453.8
100.3
677.2
Total liabilities
923.7
440.3
100.3
453.8
100.3
1,094.7
Other
Derivative financial instrument assets
(0.2)
(0.1)
(0.1)
—
—
(0.2)
Unquoted equity investment
(0.2)
—
—
—
—
—
Cash and cash equivalents
(87.4)
(87.4)
—
—
—
(87.4)
Trade and other receivables
(370.8)
(370.8)
—
—
—
(370.8)
Total
(458.6)
(458.3)
(0.1)
—
—
(458.4)
Grand total
465.1
(18.0)
100.2
453.8
100.3
636.3
The table above includes derivative financial assets with a fair value at 31 December 2024 of £0.2m and derivative financial
liabilities of £1.4m that will be settled gross, the final exchange on these derivatives will be total receipts of €75.4m and
$12.4m with corresponding payments totalling £73.8m.
The following financial assets and liabilities are subject to offsetting, enforceable master netting arrangements:
At 31 December 2024
Gross
amounts of
recognised
financial
assets/
(liabilities)
£m
Amounts
available to
offset through
netting
agreements
£m
Net amount
£m
Derivative financial assets
0.2
—
0.2
Derivative financial liabilities
(1.4)
—
(1.4)
Total
(1.2)
—
(1.2)
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
170
SIG Annual Report and Accounts 2024
Maturity analysis
2023 Analysis
Balance sheet
value
£m
< 1 year
£m
1-2 years
£m
2-5 years
£m
> 5 years
£m
Total
£m
Current liabilities
Trade and other payables
358.7
358.7
—
—
—
358.7
Lease liabilities
64.9
82.9
—
—
—
82.9
Interest-bearing loans
0.8
0.9
—
—
—
0.9
Deferred consideration
1.8
1.8
—
—
—
1.8
Derivative financial instruments
1.0
1.0
—
—
—
1.0
Total
427.2
445.3
—
—
—
445.3
Non-current liabilities
Lease liabilities
264.9
—
69.4
146.9
122.2
338.5
Interest-bearing loans
1.3
—
0.9
0.5
—
1.4
Secured notes
258.7
13.7
13.7
287.5
—
314.9
Derivative financial instruments
0.1
—
0.1
—
—
0.1
Total
525.0
13.7
84.1
434.9
122.2
654.9
Total liabilities
952.2
459.0
84.1
434.9
122.2
1,100.2
Other
Unquoted equity investment
(0.2)
—
—
—
(0.2)
(0.2)
Cash and cash equivalents
(132.2)
(132.2)
—
—
—
(132.2)
Trade and other receivables
(389.1)
(389.1)
—
—
—
(389.1)
Total
(521.5)
(521.3)
—
—
(0.2)
(521.5)
Grand total
430.7
(62.3)
84.1
434.9
122.0
578.7
The table above includes short term derivative financial assets with a fair value at 31 December 2023 of £nil and derivative
financial liabilities of £1.1m that will be settled gross, the final exchange on these derivatives will be total receipts of €62.6m
and $14.3m with corresponding payments totalling £67.0m.
The following financial assets and liabilities are subject to offsetting, enforceable master netting arrangements:
At 31 December 2023
Gross
amounts of
recognised
financial
assets/
(liabilities)
£m
Amounts
available to
offset through
netting
agreements
£m
Net amount
£m
Derivative financial assets
—
—
—
Derivative financial liabilities
(1.1)
—
(1.1)
Total
(1.1)
—
(1.1)
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20. Sensitivity analysis
IFRS 7 requires the disclosure of a sensitivity analysis that details the effects on the Group’s profit or loss and other equity of
reasonably possible fluctuations in market rates.
This sensitivity analysis has been prepared to illustrate the effect of the following hypothetical variations in market rates on the
fair value of the Group’s financial assets and liabilities:
i) a 1% (100 basis points) increase or decrease in market interest rates; and
ii) a 10% strengthening or weakening of sterling against all other currencies to which the Group is exposed.
a) Interest rate sensitivity
The Group is currently exposed to sterling, euro and Polish zloty interest rates. In order to illustrate the Group’s sensitivity to
interest rate fluctuations, the following table shows the Group’s sensitivity to a 100 basis point change in each respective
interest rate. The sensitivity analysis of the Group’s exposure to interest rate risk at the reporting date has been determined
based on the change taking place at the beginning of the financial year and held constant throughout the reporting period.
A positive number indicates an increase in profit or loss and other equity.
GBP
EUR
PLN
Total
2024 analysis
+100bp
£m
-100bp
£m
+100bp
£m
-100bp
£m
+100bp
£m
-100bp
£m
+100bp
£m
-100bp
£m
Profit or loss
0.1
(0.1) (i)
0.2
(0.2) (ii)
—
— (iii)
0.3
(0.3)
Total shareholders’ equity
0.1
(0.1)
0.2
(0.2)
—
—
0.3
(0.3)
GBP
EUR
PLN
Total
2023 analysis
+100bp
£m
-100bp
£m
+100bp
£m
-100bp
£m
+100bp
£m
-100bp
£m
+100bp
£m
-100bp
£m
Profit or loss
0.1
(0.1) (i)
0.3
(0.3) (ii)
—
— (iii)
0.4
(0.4)
Total shareholders’ equity
0.1
(0.1)
0.3
(0.3)
—
—
0.4
(0.4)
The movements noted above are mainly attributable to:
(i) floating rate sterling debt and cash deposits
(ii) floating rate euro debt and cash deposits
(iii) floating rate Polish zloty debt and cash deposits
b) Foreign currency sensitivity
The Group is exposed to currency rate changes between sterling and euros, US dollars and Polish zloty.
The following table shows the Group’s sensitivity to a 10% change in sterling against each respective foreign currency to
which the Group is exposed, indicating the likely impact of changes in foreign exchange rates on the Group’s financial position.
The sensitivity analysis of the Group’s exposure to foreign currency risk at the reporting date has been determined based on the
change taking place at the beginning of the financial year and held constant throughout the reporting period. A positive number
indicates an increase in profit or loss and other equity.
EUR
USD
PLN
Total
2024 analysis
+10%
£m
-10%
£m
+10%
£m
-10%
£m
+10%
£m
-10%
£m
+10%
£m
-10%
£m
Assets and liabilities under the
scope of IFRS 7
Profit or loss
1.5
(1.8) (i)
—
—
—
—
1.5
(1.8)
Other equity
8.9
(10.8) (ii)
(0.9)
1.1 (ii)
(2.2)
2.7 (ii)
5.8
(7.0)
Total shareholders’ equity
10.4
(12.6)
(0.9)
1.1
(2.2)
2.7
7.3
(8.8)
Total assets and liabilities1
Profit or loss
1.7
(2.1) (iii)
—
— (v)
(0.2)
0.2 (vi)
1.5
(1.9)
Other equity
(3.3)
4.1 (iv)
(0.9)
1.1 (iv)
(3.2)
3.9 (iv)
(7.4)
9.1
Total shareholders’ equity
(1.6)
2.0
(0.9)
1.1
(3.4)
4.1
(5.9)
7.2
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
172
SIG Annual Report and Accounts 2024
EUR
USD
PLN
Total
2023 analysis
+10%
£m
-10%
£m
+10%
£m
-10%
£m
+10%
£m
-10%
£m
+10%
£m
-10%
£m
Assets and liabilities under
the scope of IFRS 7
Profit or loss
1.2
(1.5) (i)
—
—
—
—
1.2
(1.5)
Other equity
4.9
(5.9) (ii)
(1.0)
1.2 (ii)
(0.8)
1.0 (ii)
3.1
(3.7)
Total shareholders’ equity
6.1
(7.4)
(1.0)
1.2
(0.8)
1.0
4.3
(5.2)
Total assets and liabilities1
Profit or loss
1.4
(1.7) (iii)
—
— (v)
—
— (vi)
1.4
(1.7)
Other equity
(3.9)
4.8 (iv)
(1.0)
1.2 (iv)
(2.4)
2.9 (iv)
(7.3)
8.9
Total shareholders’ equity
(2.5)
3.1
(1.0)
1.2
(2.4)
2.9
(5.9)
7.2
1. Certain assets and liabilities such as inventories, non-current assets and provisions do not come under the scope of IFRS 7. Therefore, in order to present a complete
analysis of the Group’s exposure to movements in foreign currency exchange rates, the exposure on the Group’s total assets and liabilities has also been disclosed.
The movements noted above are mainly attributable to:
(i) retranslation of euro interest flows
(ii) mark-to-market valuation changes in the fair value of effective net investment hedges and retranslation of assets and liabilities
under the scope of IFRS 7
(iii) retranslation of euro profit streams and transaction exposure relating to purchases in euros
(iv) retranslation of foreign currency denominated assets and liabilities outside the scope of IFRS 7 and mark-to-market valuation
changes in the fair value of effective net investment hedges
(v) transaction exposure relating to purchases in US dollars
(vi) retranslation of Polish zloty profit streams
21. Provisions
Onerous
leases
£m
Leasehold
dilapidations
£m
Other
amounts
£m
Total
£m
At 1 January 2024
0.3
25.7
2.9
28.9
Unused amounts reversed in the period
—
(1.0)
(0.5)
(1.5)
Utilised
(0.5)
(2.1)
(1.3)
(3.9)
New provisions
0.8
3.4
2.5
6.7
Exchange differences
—
(0.1)
(0.1)
(0.2)
At 31 December 2024
0.6
25.9
3.5
30.0
2024
£m
2023
£m
Included in current liabilities
7.6
7.9
Included in non-current liabilities
22.4
21.0
Total
30.0
28.9
Onerous leases
In accordance with IFRS 16, the future rental payments due over the remaining term of existing lease contracts is included in the
lease liability, with the right-of-use asset impaired to reflect the future cost not covered through sublease income. The remaining
onerous lease provision relates to other non-rental costs due over the remaining lease term based on expected value of costs to
be incurred and assumptions regarding subletting. The balance at 31 December 2024 is payable over the relevant lease terms,
the longest unexpired term being 17 years to 2041.
Leasehold dilapidations
This provision relates to contractual obligations to reinstate leasehold properties to their original state of repair. The provision is
calculated based on both the estimated liability to rectify or reinstate leasehold improvements and modifications carried out on
the inception of the lease (recognised on inception with corresponding fixed asset) and the liability to rectify general wear and
tear which is recognised as incurred over the life of the lease. The costs will be incurred both at the end of the leases as set out
in Note 23 (reinstatement) and during the lease term (wear and tear).
Other amounts
Other amounts relate principally to claims and warranty provisions based on expected value and past experience and provisions
for restructuring costs based on expected value but where the amount and timing are uncertain. The transfer of economic
benefit is expected to be made between one and four years’ time.
173
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SIG Annual Report and Accounts 2024
22. Deferred tax
The net deferred tax asset at the end of the year is analysed as follows:
2024
£m
2023
£m
Deferred tax assets
4.6
4.4
Net deferred tax asset
4.6
4.4
Summary of deferred tax
The different components of deferred tax assets and liabilities recognised by the Group and the movements during the current
and prior year are analysed below:
Goodwill and
intangibles
£m
Property,
plant and
equipment
£m
Short term
timing
differences
£m
Retirement
benefit
obligations
£m
Inventory
£m
Other
£m
Total
£m
At 1 January 2023
(4.6)
5.8
2.8
1.7
—
(2.4)
3.3
Credit/(charge) to income
1.4
(0.9)
1.0
(0.1)
—
(0.2)
1.2
Charge to equity
—
—
—
(0.1)
—
—
(0.1)
Reclassifications
—
(2.4)
—
—
—
2.4
—
Exchange differences
(0.1)
—
0.1
—
—
—
—
At 31 December 2023
(3.3)
2.5
3.9
1.5
—
(0.2)
4.4
Credit/(charge) to income
0.7
0.5
(0.7)
0.1
(0.2)
—
0.4
Charge to equity
—
—
—
—
—
—
—
Reclassifications
(0.2)
0.4
(1.2)
—
0.8
0.2
—
Exchange differences
—
—
(0.1)
(0.1)
—
—
(0.2)
At 31 December 2024
(2.8)
3.4
1.9
1.5
0.6
—
4.6
During the year, the different components of deferred tax assets and liabilities have been refined further which has resulted in
the creation of a new component ‘Inventory’. Temporary differences in existing categories have been reclassified to the other
components which reflect the nature of the temporary difference more accurately. As a result, the component ‘Other’ will cease
to be used going forward.
The deferred tax charge within the Consolidated income statement for 2024 includes a credit of £nil (2023: £0.1m credit) arising
from the change in domestic tax rates in the countries in which the Group operates.
Given current and forecast trading the Directors consider that recognition of the deferred tax assets above is appropriate.
The majority of the deferred tax asset associated with the retirement benefit obligations is in respect of the French and German
defined benefit schemes. Payments against the deficit will be deductible for tax purposes on a paid basis and the Group
expects to receive the tax benefit, therefore the associated deferred tax asset has been recognised.
The Group has cumulative tax losses and other deductible temporary differences of £407.8m (2023: £371.2m) in the UK and
£29.3m (2023: £25.5m) in Benelux for which no deferred asset is currently recognised as it is not considered probable that
sufficient future taxable profits will be available to allow the utilisation of the deductible temporary differences. For the UK,
although the trading businesses in aggregate have remained profitable in the current year, the UK tax group remains in a taxable
loss position due to the head office costs and interest on the secured notes, and there is not considered to be sufficient
convincing evidence at 31 December 2024 that sufficient future taxable profits will be available. If the Group were to recognise
all unrecognised deferred tax assets, profit and equity would have increased by £109.5m (2023: £99.4m). The deductible
temporary differences are available indefinitely.
At 31 December 2024 and 2023 there are no aggregate temporary differences associated with investments in subsidiaries
for which deferred tax liabilities have not been recognised.
The Group has considered the impact of climate-related matters on future taxable profits when assessing the recoverability
of deferred tax assets. At present, the impact of climate-related matters is not considered significant to forecast results and
therefore no specific assumptions relating to climate-change are currently built into the forecasts.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
174
SIG Annual Report and Accounts 2024
23. Leases
The Group as a lessee
The Group has lease contracts for various properties, vehicles and other equipment used in its operations. Information on the
nature and accounting for lease contracts is provided in the Accounting policies.
Set out below are the carrying amounts of right-of-use assets recognised and the movements during the period:
Buildings
£m
Vehicles, plant
and
equipment
£m
Total
£m
At 1 January 2023
209.0
56.9
265.9
Additions
29.6
30.2
59.8
Disposals
(4.2)
(0.6)
(4.8)
Modifications
32.4
2.2
34.6
Transfer to tangible fixed assets
—
(0.4)
(0.4)
Impairments
(22.1)
(4.1)
(26.2)
Depreciation expense
(42.2)
(21.7)
(63.9)
Exchange differences
(1.5)
(0.4)
(1.9)
At 31 December 2023
201.0
62.1
263.1
Additions
29.1
25.4
54.5
Disposals
(0.8)
(0.7)
(1.5)
Modifications
16.0
1.4
17.4
Transfer to tangible fixed assets
—
(0.2)
(0.2)
Impairments
(2.5)
(7.3)
(9.8)
Depreciation expense
(42.8)
(23.6)
(66.4)
Exchange differences
(4.9)
(1.9)
(6.8)
At 31 December 2024
195.1
55.2
250.3
Set out below are the carrying amounts of lease liabilities and the movements during the year:
2024
£m
2023
£m
At 31 December 2023
329.8
307.7
Foreign currency movement
(7.4)
(2.7)
Additions
53.9
59.8
Disposals
(1.5)
(5.7)
Modifications
17.4
34.7
Accretion of interest
22.3
19.6
Payments
(90.9)
(83.6)
At 31 December 2024
323.6
329.8
Current
64.9
64.9
Non-current
258.7
264.9
323.6
329.8
The following are the amounts recognised in profit or loss:
2024
£m
2023
£m
Depreciation expense of right-of-use assets
66.4
63.9
Interest expense on lease liabilities
22.3
19.6
Expense relating to short-term leases (included in operating expenses)
1.8
1.1
Impairment of right-of-use assets (included in other items)
9.8
26.2
Total amount recognised in profit or loss
100.3
110.8
175
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SIG Annual Report and Accounts 2024
23. Leases continued
The Group had total cash outflows for leases of £90.9m in 2024 (2023: £83.6m). The Group also had non-cash additions to
right-of-use assets and lease liabilities of £53.9m in 2024 (2023: £59.8m). The future cash outflows relating to leases that have
not yet commenced are disclosed in Note 29(b).
The Group has a number of lease contracts that include extension and termination options. These options are negotiated by
management to provide flexibility in managing the lease-asset portfolio and align with the Group’s business needs.
Set out below are the undiscounted potential future rental payments relating to periods following the expiry date of extension
and termination options that are not included in the lease term.
Within
five years
£m
More than
five years
£m
Total
£m
Extension options expected not to be exercised
6.1
6.1
12.2
Termination options expected to be exercised
7.8
17.8
25.6
13.9
23.9
37.8
The Group as a lessor
The Group is an intermediate lessor of a number of property leases which are subleased to a third party and are classified as
finance leases in accordance with IFRS 16. The Group has lease receivables of £2.2m at 31 December 2024 (2023: £3.3m).
These leases have remaining terms of between 2 and 12 years. Rental income recognised by the Group during the year is
£1.2m (2023: £0.6m).
Future lease payments receivable from sub-leases classified as finance leases are as follows:
2024
£m
2023
£m
Within one year
0.3
1.1
After one year but not more than five years
1.6
1.6
More than five years
0.7
1.0
2.6
3.7
Less: future finance charges
(0.4)
(0.4)
Lease receivables
2.2
3.3
Of the total lease receivables, £0.3m (2023: £1.1m) is due within one year and £1.9m (2023: £2.2m) is due after more than one
year.
Future minimum rentals receivable under non-cancellable operating leases are as follows:
2024
£m
2023
£m
Within one year
0.4
0.4
After one year but not more than five years
1.7
0.9
More than five years
—
0.2
2.1
1.5
24. Called up share capital
2024
£m
2023
£m
Authorised:
1,390,000,000 ordinary shares of 10p each (2023: 1,390,000,000)
139.0
139.0
Allotted, called up and fully paid:
1,181,556,977 ordinary shares of 10p each (2023: 1,181,556,977)
118.2
118.2
The Company has one class of ordinary share which carries no right to fixed income. The Company did not allot any shares
during the year.
Treasury shares
Treasury shares relate to shares purchased by the EBT to satisfy awards made under the Group’s share plans which are not
vested and beneficially owned by employees. 3,001,375 (2023: 5,901,425) shares were purchased during the year at a weighted
average cost of 28.7p per share (2023: 28.9p) and 8,808,795 shares were issued relating to the settlement of share awards
(2023: 13,357,702). A total of 20,614,080 own shares are outstanding at 31 December 2024 (2023: 26,421,500).
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
176
SIG Annual Report and Accounts 2024
25. Reconciliation of loss before tax to cash generated from operating activities
2024
£m
2023
£m
Loss before tax
(44.8)
(31.9)
Net finance costs (Note 5)
41.0
35.9
Depreciation of property, plant and equipment (Note 10)
12.5
12.7
Depreciation of right-of-use assets (Note 23)
66.4
63.9
Amortisation of computer software (Note 12)
1.2
2.4
Amortisation of acquired intangibles (Note 12)
2.1
2.8
Impairment of property, plant and equipment (Note 10)
1.2
4.4
Impairment of goodwill (Note 11)
—
2.6
Impairment of acquired intangibles and computer software (Note 12)
—
2.5
Impairment of right-of-use assets (Note 23)
9.8
26.2
Reversal of impairment of lease receivables (Note 2)
—
(1.1)
Gain on lease transactions
—
(1.1)
Gain on disposal of property, plant and equipment
(1.0)
(4.3)
Share-based payment expense
4.1
5.5
Net foreign exchange differences
(0.2)
—
Decrease in provisions
(1.2)
(0.2)
Working capital movements:
– (Increase)/decrease in inventories
(1.5)
9.2
– Decrease in receivables
10.1
45.2
– Decrease in payables
(16.2)
(46.3)
Cash generated from operating activities
83.5
128.4
Included within the cash generated from operating activities is a defined benefit pension scheme employer’s contribution of
£2.5m (2023: £2.5m).
26. Reconciliation of net cash flow to movements in net debt
2024
£m
2023
£m
(Decrease)/increase in cash and cash equivalents in the year
(39.7)
2.7
Net cash outflow from repayment of leases and other debt1
95.3
84.5
Decrease in net debt resulting from cash flows
55.6
87.2
Non-cash movement in lease liabilities and lease receivables
(92.0)
(105.8)
Other non-cash items2
(17.5)
(3.3)
Exchange differences
14.6
7.9
Increase in net debt in the year
(39.3)
(14.0)
Net debt at 1 January
(458.0)
(444.0)
Net debt at 31 December
(497.3)
(458.0)
1. Including interest element of lease payments.
2. Other non-cash items relates to the fair value movement of debt and derivative financial instruments recognised in the year which does not give rise to a cash inflow
or outflow.
177
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SIG Annual Report and Accounts 2024
26. Reconciliation of net cash flow to movements in net debt continued
Net debt is defined as follows:
2024
£m
2023
£m
Non-current assets:
Derivative financial instruments
0.1
—
Lease receivables
1.9
2.2
Current assets:
Derivative financial instruments
0.1
—
Lease receivables
0.3
1.1
Cash at bank and on hand
87.4
132.2
Current liabilities:
Lease liabilities
(64.9)
(64.9)
Interest-bearing loans and borrowings
(5.2)
(0.8)
Deferred consideration
—
(1.8)
Derivative financial instruments
(1.3)
(1.0)
Non-current liabilities:
Lease liabilities
(258.7)
(264.9)
Interest-bearing loans and borrowings
(256.9)
(260.0)
Derivative financial instruments
(0.1)
(0.1)
Net debt
(497.3)
(458.0)
Of the cash at bank and on hand of £87.4m (2023: £132.2m), £0.6m (2023: £1.0m) is required to be held to cover bank
guarantees issued to third parties and is therefore restricted for use by the Group.
27. Analysis of net debt
At 31
December
2023
£m
Cash flows
£m
Non-cash
items1
£m
Exchange
differences
£m
At 31
December
2024
£m
Cash at bank and on hand
132.2
(39.7)
—
(5.1)
87.4
Lease receivables
3.3
(1.2)
0.1
—
2.2
135.5
(40.9)
0.1
(5.1)
89.6
Liabilities arising from financing activities
Financial assets – derivative financial instruments
—
—
0.2
—
0.2
Debts due within one year
(3.6)
2.6
(5.5)
—
(6.5)
Debts due after one year
(260.1)
3.0
(12.2)
12.3
(257.0)
Lease liabilities
(329.8)
90.9
(92.1)
7.4
(323.6)
(593.5)
96.5
(109.6)
19.7
(586.9)
Net debt
(458.0)
55.6
(109.5)
14.6
(497.3)
1. Non-cash items include the fair value movement of debt recognised in the year which does not give rise to a cash inflow or outflow, movements between debts due
within one year and after one year, and non-cash movements in relation to lease liabilities and lease receivables.
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
178
SIG Annual Report and Accounts 2024
28. Retirement benefit obligations
The Group operates a number of pension schemes, four (2023: four) of which provide defined benefits based on final pensionable
salary. Of these schemes, one (2023: one) has assets held in a separate trustee administered fund and three (2023: three) are
overseas book reserve schemes. The Group also operates a number of defined contribution schemes, all of which are
independently managed.
There is one pension plan in The Netherlands, which is classified as a multi-employer defined benefit scheme under IAS 19, but
is recognised in the Consolidated financial statements as a defined contribution scheme since the pension fund is not able to
provide sufficient information to allow SIG’s share of the assets and liabilities to be separately identified. Therefore, the Group’s
annual pension expense for this scheme (the industry-wide pension plan for the construction materials industry (‘BPF HiBiN’))
is equal to the required contribution each year. The coverage ratio of the multi-employer union plan increased to 111% as at
31 December 2024 (2023: 110%). The pension premium percentage increased slightly to 25.4% (2023: 25.2%). The coverage
ratio is calculated by dividing the fund’s assets by the total sum of pension liabilities and is based upon market interest rates.
The Company’s participation in this scheme represents c0.1% of the total members. The Company is not liable for other
participants’ obligations, and there is no agreed allocation of surplus or deficit on withdrawal from the scheme or on winding
up of the scheme. The pension premium percentage will remain the same at 25.4% in 2025. The Company is not aware of
any other planned changes to contributions or benefits at the current time.
The Group’s total pension charge for the year, including amounts charged to interest and Other items, was £8.3m (2023:
£8.9m), of which a charge of £1.1m (2023: £1.4m) related to defined benefit pension schemes and £7.2m (2023: £7.5m) related
to defined contribution schemes.
Defined benefit pension scheme valuations
In accordance with IAS 19 the Group recognises all actuarial gains and losses in full in the period in which they arise in the
Consolidated statement of comprehensive income.
The actuarial valuation of the SIG plc Retirement Benefits Plan (“the Plan”), the UK scheme which is the largest scheme of the
Group, is assessed by an independent actuary every three years who recommends the rate of contribution payable each year.
The latest formal triennial actuarial valuation of the UK scheme was as at 31 December 2022 and was concluded in March
2024, and showed that the market value of the scheme’s assets was £121.7m and their actuarial value covered 102% of the
benefits accrued to members. The UK defined benefit pension scheme was closed to future benefit accrual on 30 June 2016.
In 2018 an asset-backed funding arrangement was put in place to fund the triennial pension deficit identified by the valuation as
at 31 December 2016 and to increase security of the Plan. The asset backed funding arrangement transfers certain rights over
a managed pool of certain customer receivables of one of the Group’s subsidiary companies to a partnership and provides
a mechanism to settle future funding commitments from receipts from higher quality trade receivables to ensure contributions
to the Plan of £2.5m per annum for up to 20 years (as may be required and subject to certain discretions). The balance of
receivables assigned to the managed pool is disclosed in Note 15. The partnership is controlled by the Group and is therefore
included within the Consolidated financial statements. The receivables continue to be recognised on the Consolidated balance
sheet, and the Plan’s interest in the partnership is a non-transferable financial asset issued by the Group, and therefore does
not constitute a plan asset for the Group. Distribution of income to the partners of the partnership, which forms the contribution
to the Plan, is at the discretion of the General Partner, a subsidiary of the Group. There is however a guarantee in place which
ensures that the Group’s subsidiary, SIG Trading Limited, will make an equivalent contribution to the Plan if the partnership does
not effect the discretionary distribution. The Group is therefore committed to making a contribution of £2.5m per annum until
the structure terminates at the end of 20 years (March 2038) or earlier if certain agreed funding levels are reached.
The Trustees of the pension fund are required by law to act in the interest of the fund and of all relevant stakeholders in the
scheme. The Trustees of the pension fund are responsible for the investment policy with regard to the assets of the fund.
The other three schemes are book reserve schemes whereby the sponsoring company does not hold any separate assets to
fund the pension scheme but makes a reserve in its accounts. Therefore, these schemes do not hold separate scheme assets.
The liabilities of the schemes are met by the sponsoring companies.
179
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Financials
SIG Annual Report and Accounts 2024
28. Retirement benefit obligations continued
The schemes typically expose the Group to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary
risk. The risk relating to benefits to be paid to the dependants of scheme members on death in service is reinsured by an
external insurance company.
Investment risk
The present value of the defined benefit plan liability is calculated using a discount rate determined by reference
to high quality corporate bond yields; if the return on plan assets falls below this rate, it will create a plan deficit.
Currently the plan has relatively balanced investments in line with the Trustees’ Statement of Investment Principles
between equity securities and debt instruments. Due to the long-term nature of the plan liabilities, the Trustees of the
pension fund consider it appropriate that a reasonable portion of the plan assets should be invested in growth assets
to leverage the return generated by the fund.
Interest rate risk
A decrease in the bond interest rate will increase the plan liability but this will be partially offset by an increase in the
return on the plan’s bond holdings.
Longevity risk
The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of
plan participants both during and after their employment. An increase in the life expectancy of the plan participants
will increase the plan’s liability.
Salary risk
The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan
participants (except in the UK where the Plan is closed to future accrual). As such, an increase in the salary of the
plan participants will increase the plan’s liability.
Consolidated income statement charges
The pension charge for the year, including amounts charged to interest of £0.6m (2023: £0.8m) relating to the defined benefit
pension schemes, was £1.1m (2023: £1.4m).
In accordance with IAS 19, the charge for the defined benefit schemes has been calculated as the sum of the cost of benefits
accruing in the year, the increase in the value of benefits already accrued and the expected return on assets. The actuarial
valuations described previously have been updated at 31 December 2024 by a qualified actuary using revised assumptions
that are consistent with the requirements of IAS 19. Investments have been valued, for this purpose, at fair value.
The UK defined benefit scheme is closed to new members and has an age profile that is rising. The three overseas book
reserve schemes remain open to new members.
Consolidated balance sheet liability
The balance sheet position in respect of the four defined benefit schemes can be summarised as follows:
2024
£m
2023
£m
Pension liability before taxation
(18.2)
(20.3)
Related deferred tax asset
1.5
1.5
Pension liability after taxation
(16.7)
(18.8)
The actuarial loss of £0.2m (2023: £1.1m gain) for the year, together with an associated deferred tax debit of £nil (2023: £0.1m
debit), has been recognised in the Consolidated statement of comprehensive income.
Of the above pension liability before taxation, £10.9m (2023: £12.7m) relates to the funded scheme in the UK and £7.3m
(2023: £7.6m) relates to the overseas unfunded schemes. The liability in relation to the UK scheme has decreased during the
year due to an actuarial gain on the liabilities due to changes in assumptions and inflation experience and the employer
contribution of £2.5m, partially offset by a loss on scheme assets and finance costs of £0.5m.
The movement in the pension liability before taxation in the year can be summarised as follows:
2024
£m
2023
£m
Pension liability at 1 January
(20.3)
(23.0)
Current service cost
(0.5)
(0.6)
Payment of unfunded benefits
0.5
0.3
Contributions
2.5
2.5
Net finance cost
(0.6)
(0.8)
Actuarial (loss)/gain
(0.2)
1.1
Effect of changes in exchange rates
0.4
0.2
Pension liability at 31 December
(18.2)
(20.3)
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
180
SIG Annual Report and Accounts 2024
The principal assumptions used for the IAS 19 actuarial valuation of the UK scheme (the largest scheme of the Group) were:
2024
%
2023
%
Rate of increase in salaries1
n/a
n/a
Rate of fixed increase of pensions in payment
1.9%
1.9%
Rate of increase of LPI pensions in payment
3.1%
3.0%
Discount rate
5.4%
4.5%
Inflation assumption
3.2%
3.1%
1. Upon closure of the UK defined benefit scheme to future benefit accrual the accrued benefits of active members ceased to be linked to their final salary and will
instead revalue in deferment broadly in line with movements in the Consumer Price Index.
Deferred pensions are revalued to retirement in line with the schemes’ rules and statutory requirements, with the inflation
assumption used for LPI revaluation in deferment.
Within the principal plan the life expectancy for a male employee beyond the normal retirement age of 65 is 21.8 years
(2023: 21.7 years). The life expectancy on retirement at age 65 of a male employee currently aged 45 years is 22.2 years (2023:
22.1 years). The life expectancy for a female employee beyond the normal retirement age of 65 is 23.5 years (2023: 23.3 years).
The life expectancy on retirement at age 65 of a female employee currently aged 45 years is 25.0 years (2023: 24.9 years).
The sensitivity analyses below have been determined based on reasonably possible changes of the respective assumptions
occurring at the end of the reporting period, while holding all other assumptions constant. If the discount rate were to be
increased/decreased by 0.1%, this would decrease/increase the Group’s gross pension scheme deficit by c£0.9m. If the rate
of inflation increased/decreased by 0.1% this would increase/decrease the Group’s gross pension scheme deficit by c£0.3m.
If the life expectancy for employees increased by one year the Group’s gross pension scheme deficit would increase by c£4.0m.
The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is
unlikely that the changes in assumptions would occur in isolation of one another as some of the assumptions may be correlated.
The average duration of the defined benefit scheme obligation at 31 December 2024 is 10 years (2023: 12 years).
In June 2023, the UK High Court in Virgin Media Limited v NTL Pension Trustees II Limited ruled that specific historical
amendments to contracted-out defined benefit schemes in the period from 6 April 1997 to 5 April 2016 were invalid if they
lacked confirmation under section 37 of the Pension Schemes Act 1993 from the scheme’s actuary. This decision was upheld
on appeal in July 2024. The UK Pension Plan’s Trustees, in conjunction with their legal advisers, have carried out a review of
the deeds of amendment issued within the relevant period, and concluded that, given the nature and purpose of those deeds,
no significant impact on the Plan’s funding position as a consequence of the judgement is expected.
The fair value of assets held at the balance sheet date were:
2024
£m
2023
£m
Equities
20.2
16.3
Corporate and government bonds
51.6
58.8
Investment funds
13.2
15.4
Property
5.2
5.8
Cash
1.1
3.3
Total fair value of assets
91.3
99.6
All equity and debt instruments have quoted prices in active markets and can be classified as Level 1 and 2 instruments, other
than property which is Level 3.
The amount included in the Consolidated balance sheet arising from the Group’s obligation in respect of its defined benefit
schemes is as follows:
2024
£m
2023
£m
Fair value of assets
91.3
99.6
Present value of scheme liabilities
(109.5)
(119.9)
Net liability recognised in the Consolidated balance sheet
(18.2)
(20.3)
The overall expected rate of return is based upon market conditions at the balance sheet date.
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28. Retirement benefit obligations continued
Amounts recognised in the Consolidated income statement in respect of these defined benefit schemes are as follows:
2024
£m
2023
£m
Current service cost
0.5
0.6
Net finance cost
0.6
0.8
Amounts recognised in the Consolidated income statement
1.1
1.4
Analysis of the actuarial (loss)/gain recognised in the Consolidated statement of comprehensive income in respect of the schemes:
2024
£m
2023
£m
Actual return less expected return on assets
(8.9)
(2.3)
Effect of changes in demographic assumptions
(0.4)
5.8
Effect of changes in financial assumptions
9.2
(4.5)
Impact of liability experience
(0.1)
2.1
Remeasurement of the defined benefit liability
(0.2)
1.1
The remeasurement of the net defined benefit liability is included within the Consolidated statement of comprehensive income.
Movements in the present value of the schemes’ liabilities were as follows:
2024
£m
2023
£m
Present value of schemes’ liabilities at 1 January
(119.9)
(124.3)
Current service cost
(0.5)
(0.6)
Interest on pension schemes’ liabilities
(5.0)
(5.6)
Benefits paid
6.3
6.7
Payment of unfunded benefits
0.5
0.3
Effect of changes in exchange rates
0.4
0.2
Remeasurement gains/(losses):
Actuarial gain arising from changes in demographic assumptions
(0.4)
5.8
Actuarial (loss)/gain arising from changes in financial assumptions
9.2
(4.5)
Actuarial gain/(loss) due to liability experience
(0.1)
2.1
Present value of schemes’ liabilities at 31 December
(109.5)
(119.9)
Movements in the fair value of the schemes’ assets were as follows:
2024
£m
2023
£m
Fair value of schemes’ assets at 1 January
99.6
101.3
Finance income
4.4
4.8
Actual return less expected return on assets
(8.9)
(2.3)
Contributions from sponsoring companies
2.5
2.5
Benefits paid
(6.3)
(6.7)
Fair value of schemes’ assets at 31 December
91.3
99.6
Notes to the consolidated financial statements continued
for the year ended 31 December 2024
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SIG Annual Report and Accounts 2024
29. Commitments and contingencies
a) Capital commitments
2024
£m
2023
£m
The purchase of property, plant and equipment contracted but not provided for
0.9
0.1
b) Lease commitments
The Group has various lease contracts that have not yet commenced as at 31 December 2024. The future lease payments for
these non-cancellable lease contracts are £2.6m within one year (2023: £1.3m), £9.7m within five years (2023: £4.3m) and
£4.3m thereafter (2023: £1.7m).
Information on the Group’s leasing arrangements is included in Note 23.
c) Contingent liabilities
As at the balance sheet date, the Group had outstanding obligations under customer guarantees, claims, standby letters of
credit and discounted bills of up to £10.8m (2023: £12.5m). Of this amount, £4.3m (2023: £6.1m) relates to a standby letter of
credit issued by HSBC Bank plc in respect of the Group’s insurance arrangements.
As part of the disposal of the Building Plastics business in 2017 a guarantee was provided to the landlord of the leasehold
properties transferred with the business covering rentals over the remaining term of the leases in the event that the acquiring
company enters into administration before the end of the lease term. The maximum liability that could arise from this would be
approximately £0.5m (2023: £0.6m) based on the remaining future rent commitment at 31 December 2024. No provision has
been made in these financial statements as it is not considered likely that any loss will be incurred in connection with this.
30. Related party transactions
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and
have therefore not been disclosed.
In 2024, SIG incurred expenses of £0.6m (2023: £0.3m) on behalf of the SIG plc Retirement Benefits Plan, the UK defined
benefit pension scheme.
Remuneration of key management personnel
The total remuneration of key management personnel of the Group, being the Executive Leadership Team members and the
Non-Executive Directors (see page 112), is set out below in aggregate for each of the categories specified in IAS 24 “Related
Party Disclosures”.
2024
£m
2023
£m
Short term employee benefits
7.2
6.7
Termination and post-employment benefits
—
0.3
IFRS 2 share-based payment expense
2.9
4.6
10.1
11.6
31. Subsidiaries
Details of the Group’s subsidiaries, all of which have been included in the Consolidated financial statements, are shown on
pages 206 to 208.
32. Post balance sheet events
There are no post balance sheet events requiring adjustment or disclosure in the Consolidated financial statements.
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Non-statutory information
The Group uses a number of alternative performance measures, which are non-IFRS, to describe the Group’s performance.
The Group considers these performance measures to provide useful historical financial information to help investors evaluate
the underlying performance of the business. Alternative performance measures are not a substitute for, or superior to, statutory
IFRS measures.
These measures, as shown below, are used to improve the comparability of information between reporting periods and
geographical units and to adjust for Other items (as explained in further detail within the Accounting policies). This also reflects
how the business is managed and measured on a day-to-day basis. Measures presented are aligned with the key performance
measures used in the business and as included in the Strategic report.
a) Leverage
Leverage is the financial covenant applicable to the RCF and is used as a key performance metric for the Group. It is calculated
as net debt divided by the last twelve months underlying EBITDA.
2024
£m
2023
£m
Underlying operating profit
25.1
53.1
Add back:
Depreciation of right-of-use assets and property, plant and equipment
78.9
76.6
Amortisation of computer software
1.2
2.4
Underlying EBITDA
105.2
132.1
Reported net debt
497.3
458.0
Leverage
4.7x
3.5x
b) Like-for-like sales
Like-for-like sales is calculated on a constant currency basis, and represents the growth in the Group’s sales per working day,
excluding any acquisitions or disposals completed or agreed in the current and prior year, and adjusted to exclude the net
impact of branch closures or openings. This measure shows how the Group has developed its revenue for comparable
business relative to the prior period. As such it is a key measure of the growth of the Group during the year. Underlying revenue
is revenue from continuing operations excluding non-core businesses.
UK
Interiors
£m
UK
Roofing
£m
UK
Specialist
Markets
£m
Total UK
£m
France
Interiors
£m
France
Roofing
£m
Total
France
£m
Germany
£m
Benelux
£m
Ireland
£m
Poland
£m
Total
Group
£m
Statutory and
underlying revenue
2024
499.1
381.7
253.3 1,134.1
200.5
421.9
622.4
438.5
103.6
104.3
241.4 2,644.3
Less inter-segment
revenue
(4.1)
(1.1)
(15.2)
(20.4)
(0.1)
(11.8)
(11.9)
—
—
(0.2)
—
(32.5)
External revenue
495.0
380.6
238.1 1,113.7
200.4
410.1
610.5
438.5
103.6
104.1
241.4 2,611.8
Statutory and
underlying revenue
2023
563.7
370.4
266.0 1,200.1
219.0
471.3
690.3
462.1
116.9
94.1
237.9 2,801.4
Less inter-segment
revenue
(7.2)
(1.0)
(18.4)
(26.6)
(0.1)
(13.3)
(13.4)
—
—
(0.2)
—
(40.2)
External revenue
556.5
369.4
247.6 1,173.5
218.9
458.0
676.9
462.1
116.9
93.9
237.9 2,761.2
% change year
on year:
Underlying revenue (11.1)%
3.0%
(3.8)%
(5.1)%
(8.5)%
(10.5)%
(9.8)%
(5.1)%
(11.4)%
10.9%
1.5%
(5.4)%
Impact of currency
—
—
—
—
2.5%
2.5%
2.5%
2.6%
2.5%
3.0%
(2.3)%
1.1%
Impact of branch
changes
2.6%
(0.1)%
—
1.3%
(0.3)%
0.3%
0.1%
0.2%
1.2%
—
(1.1)%
0.5%
Impact of
working days
(1.1)%
(1.2)%
(1.1)%
(1.1)%
(0.7)%
(0.4)%
(0.5)%
—
(0.7)%
(0.9)%
(0.3)%
(0.7)%
Like-for-like sales
(9.6)%
1.7%
(4.9)%
(4.9)%
(7.0)%
(8.1)%
(7.7)%
(2.3)%
(8.4)%
13.0%
(2.2)%
(4.5)%
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SIG Annual Report and Accounts 2024
c) Operating margin
This is used to enhance understanding and comparability of the underlying financial performance of the Group and is calculated
as underlying operating profit as a percentage of underlying revenue.
2024
£m
2023
£m
Underlying revenue
2,611.8
2,761.2
Underlying operating profit
25.1
53.1
Operating margin
1.0%
1.9%
d) Free cash flow
Free cash flow is defined as all cash flows excluding M&A transactions, dividend payments and financing transactions.
Operating cash flow represents free cash flow before interest and financing and tax. These measures are used to enhance
understanding and comparability of the cash generation of the Group.
2024
£m
2023
£m
(Decrease)/increase in cash and cash equivalents in the year
(39.7)
2.7
Add back:
Settlement of amounts payable for previous purchases of businesses (included within cash flow from
investing activities)
4.4
0.7
Settlement of amounts payable for previous purchases of businesses (included within cash flow from
operating activities)
4.0
—
Repayment of borrowings
239.7
0.8
Proceeds from borrowings
(247.0)
—
Free cash flow
(38.6)
4.2
Add back:
Finance costs paid
37.5
36.9
Finance income received
(2.7)
(2.2)
Tax paid
8.0
14.0
Operating cash flow
4.2
52.9
e) Other non-statutory measures
In addition to the alternative performance measures noted above, the Group also uses underlying EPS (as set out in Note 8),
underlying net finance costs (as set out in Note 5) and average trade working capital to sales ratio. Average trade working
capital to sales ratio is calculated as the average trade working capital each month end (net inventory, gross trade creditors,
net trade receivables and supplier rebates receivable) divided by underlying revenue.
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Independent auditors report
to the members of SIG plc
Opinion
In our opinion:
–SIG plc’s Group financial statements and parent company financial statements (the “financial statements”) 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 loss for the
year then ended;
–the Group financial statements have been properly prepared in accordance with UK adopted international accounting
standards;
–the parent company financial statements have been properly prepared in accordance with United Kingdom Generally
Accepted Accounting Practice; and
–the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements of SIG plc (the ‘parent company’) and its subsidiaries (the ‘Group’) for the year ended
31 December 2024 which comprise:
Group
Parent company
Consolidated income statement for the year ended 31 December 2024
Company balance sheet as at 31 December 2024
Consolidated statement of comprehensive income for the year then ended
Statement of changes in equity for the year
then ended
Consolidated balance sheet as at 31 December 2024
Related notes 1 to 14 to the financial statements
including material accounting policy information
Consolidated statement of changes in equity for the year then ended
Consolidated statement of cash flows for the year then ended
Related notes 1 to 32 to the financial statements, including material
accounting policy information
The financial reporting framework that has been applied in the preparation of the Group financial statements is applicable law
and UK 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).
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 believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion
Independence
We are independent of the Group and parent in accordance with the ethical requirements that are relevant to our audit of the
financial statements in the UK, including 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 prohibited by the FRC’s Ethical Standard were not provided to the Group or the parent company and
we remain independent of the Group and the parent company in conducting the audit.
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 and parent
company’s ability to continue to adopt the going concern basis of accounting included:
–Confirming our understanding of management’s going concern assessment which included the preparation of the base case
cash forecast and the reasonable worst-case scenario covering the going concern period until 31 March 2026. We also
engaged with management early to ensure all key risk factors were considered in their assessment;
–Obtaining management’s going concern assessment, including the cash forecast for the going concern period through to
31 March 2026 and testing this for arithmetical accuracy. Management modelled a reasonable worst-case scenario in its cash
forecasts in order to incorporate unexpected changes to the forecasted liquidity of the Group;
–Checking the consistency of information used in management’s assessment with the budget and medium-term plan approved
by the Board and information obtained from other areas of the audit;
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SIG Annual Report and Accounts 2024
–Assessing the impact of the refinancing of the Secured Notes and Revolving Credit Facility (“RCF”) in 2024 and verifying the
nature of facilities, repayment terms, covenants, and other conditions;
–Assessing the continued availability of the facilities to the Group through the going concern period which included assessing
the forecasted covenant compliance;
–Challenging the appropriateness of the key assumptions in management’s forecasts, including revenue growth and operating
margin percentage, by comparing these to year-to-date performance and industry benchmarks;
–Checking the forecasts used were consistent with those used in management’s assessment of impairment and deferred tax
asset recoverability;
–Challenging management’s consideration of a reasonable worst-case scenario, evaluating whether the impact of a prolonged
downturn in trading had been appropriately included and whether climate risk may materially impact the going concern
assessment;
–Considering management’s reverse stress test in order to identify and understand what factors and how severe a downside
scenario would have to be to result in the Group utilising all liquidity or breaching a financial covenant during the going
concern period;
–Assessing the plausibility of management’s downside scenarios, including the reverse stress test, by comparing to third-party
data, including industry and broker reports, for indicators of contradictory evidence, including market growth expectations and
broker consensus on expected outturn of the Group and performance of the industry;
–Considering the amount and timing of mitigating factors under the Group’s control that could preserve cash if required and
performing independent analyses on the plausibility of cash management scenarios;
–Reviewing information about post year end performance for any contradictory factors that might impact management’s
forecast assumptions; and
–Reviewing the Group’s going concern disclosures included in the annual report in order to assess whether they were
appropriate and in conformity with the reporting standards.
Key Observations:
–At 31 December 2024 the Group has committed facilities of €300m Secured Notes and a £90m RCF to October 2029 and
April 2029, respectively. The RCF has a leverage maintenance covenant which is only effective if the facility is over 40% (i.e.
£36.0m or more) drawn at a quarter end reporting date. In the reasonable worst-case scenario, if the RCF was drawn by at
least £36.0m, no breach of the covenants is forecasted.
–The results from both management’s evaluation and our independent sensitivity analysis and reverse stress testing indicate
that a scenario whereby a decline in performance is severe enough to cause a liquidity issue and/or a covenant breach is
considered remote.
–Our consideration of other evidence, including industry and broker reports, did not contradict the assumptions in
management’s forecasts. Additionally, we did not identify events or conditions in the period to 31 March 2026 that may cast
doubt on the Group’s ability to continue as a going concern.
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 and parent company’s ability to continue as a going concern
for a period to 31 March 2026.
In relation to the Group and parent company’s reporting on how they have 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. However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the
Group’s ability to continue as a going concern.
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Independent auditors report continued
to the members of SIG plc
Overview of our audit approach
Audit scope
–We performed an audit of the complete financial information of five components and audit procedures
on specific balances for a further seven components and central procedures on goodwill and intangible
assets, plus the Group consolidation.
Key audit matters
–Risk of impairment (with a specific risk over prospective financial information):
–Group financial statements: goodwill, intangible assets, property, plant and equipment and
right-of-use assets
–Parent company financial statements: investments in and debtors owed by subsidiary undertakings
–Misstatement of supplier rebate income and the associated receivable
Materiality
–Overall Group materiality of £3.0m which represents 0.5% of Group gross margin.
An overview of the scope of the Parent company and Group audits
Tailoring the scope
In the current year our audit scoping has been updated to reflect the new requirements of ISA (UK) 600 (Revised). We have
followed a risk-based approach when developing our audit approach to obtain sufficient appropriate audit evidence on which
to base our audit opinion. We performed risk assessment procedures, with input from our component auditors, to identify and
assess risks of material misstatement of the Group financial statements and identified significant accounts and disclosures.
When identifying components at which audit work needed to be performed to respond to the identified risks of material
misstatement of the Group financial statements, we considered our understanding of the Group and its business environment,
the potential impact of climate change, the applicable financial framework, the Group’s system of internal control at the entity
level, the existence of centralised processes, applications and any relevant internal audit results.
We determined that centralised audit procedures could be performed on the following key audit areas:
Key audit area on which procedures were performed centrally
Impairment of goodwill, intangible assets, property, plant and equipment and right-of-use assets
Derivative financial assets and liabilities
Shareholders’ equity
Group consolidation
We then identified nine components as individually relevant to the Group due to relevant events and conditions underlying the
identified risks of material misstatement of the Group financial statements being associated with the reporting components in
addition to financial size of the component relative to the Group.
For those individually relevant components, we identified the significant accounts where audit work needed to be performed at
these components by applying professional judgement, having considered the Group significant accounts on which centralised
procedures will be performed, the reasons for identifying the financial reporting component as an individually relevant component
and the size of the component’s account balance relative to the Group significant financial statement account balance.
We then considered whether the remaining Group significant account balances not yet subject to audit procedures, in
aggregate, could give rise to a risk of material misstatement of the Group financial statements. We selected three additional
components of the Group to include in our audit scope to address these risks.
Having identified the components for which work will be performed, we determined the scope to assign to each component.
Of the twelve components selected, we designed and performed audit procedures on the entire financial information of five
components (“full scope components”). For seven components, we designed and performed audit procedures on specific
significant financial statement account balances or disclosures of the financial information of the component (“specific scope
components”).
Our scoping to address the risk of material misstatement for each key audit matter is set out in the Key audit matters section of
our report.
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SIG Annual Report and Accounts 2024
Involvement with component teams
In establishing our overall approach to the Group audit, we determined the type of work that needed to be undertaken at each
of the components by us, as the Group audit engagement team, or by component auditors operating under our instruction.
The Group audit team continued to follow a programme of planned visits that has been designed to ensure that the Senior
Statutory Auditor visits all full scope component locations regularly. During the current year’s audit cycle, visits were undertaken
by the Group audit team to the component teams in France (covering three components), Germany, and the Netherlands, with
the Senior Statutory Auditor visiting France and the Netherlands. These visits involved discussing the audit approach with the
component team and any issues arising from their work, meeting with local management, attending planning and closing
meetings, and reviewing relevant audit working papers on risk areas. The Group audit team interacted regularly with the
component teams where appropriate during various stages of the audit, reviewed relevant working papers and were responsible
for the scope and direction of the audit process. At critical periods of the audit, we increased the use of online collaboration tools
to facilitate team meetings, information sharing and the evaluation, review and oversight of component teams. We requested
detailed deliverables from component teams, and we utilised fully the interactive capability of EY Canvas, our global audit
workflow tool, to review remotely the relevant underlying work performed. The Senior Statutory Auditor is responsible for the five
in-scope UK components, including the head office entity. Where relevant, the section on key audit matters details the level of
involvement we had with component auditors to enable us to determine that sufficient audit evidence had been obtained as a
basis for our opinion on the Group as a whole.
This, together with the additional procedures performed at Group level, gave us appropriate evidence for our opinion on the
Group financial statements.
Climate change
There remains increased interest from stakeholders as to how climate change will impact the Group. The Group has determined
that the most significant future impacts from climate change on its operations will be the removal of fossil fuels from the Group’s
fleet of vehicles. These are explained on pages 42 to 51 in the required Task Force on Climate Related Financial Disclosures and
Non-Financial and Sustainability information statement and on pages 64 to 67 in the principal risks and uncertainties. The
Group have also explained their climate commitments in the Sustainability review on pages 26 to 51. All of these disclosures
form part of the “Other information,” rather than the audited financial statements. Our procedures on these unaudited
disclosures therefore consisted solely of considering whether they are materially inconsistent with the financial statements or
our knowledge obtained in the course of the audit or otherwise appear to be materially misstated, in line with
our responsibilities on “Other information”.
In planning and performing our audit we assessed the potential impacts of climate change on the Group’s business and any
consequential material impact on its financial statements.
The Group has explained in the Basis of preparation section of the Accounting policies footnote how the Group has assessed
the impact of climate change on the carrying value of non-current assets and the impact on forecasts used in the impairment
review and the assessments of going concern and longer-term viability. Management concluded these considerations did not
have a material impact on the Group in the current year or over the next three years.
Our audit effort in considering the impact of climate change on the financial statements was focused on evaluating
management’s assessment of the impact of climate risk, physical and transition, and their climate commitments. As part of this
evaluation, we performed our own risk assessment, supported by our climate change internal specialists, to determine the risks
of material misstatement in the financial statements from climate change which needed to be considered in our audit.
We also challenged the directors’ considerations of climate change risks in their assessment of going concern and viability and
associated disclosures. Where considerations of climate change were relevant to our assessment of going concern, these are
described above.
Based on our work, while we have not identified the impact of climate change on the financial statements to be a standalone
key audit matter, we have considered the impact on the ‘Impairment of goodwill, intangible assets, property, plant and
equipment, and right-of-use assets’ key audit matter. Details of the impact, our procedures and findings are included in
our explanation of key audit matters below.
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SIG Annual Report and Accounts 2024
Independent auditors report continued
to the members of SIG plc
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 our opinion thereon, and we do not provide a separate opinion on these matters.
Risk
Our response to the risk
Risk of impairment (with a
specific risk over prospective
financial information) of:
– Group financial statements:
goodwill, intangible assets,
property, plant and
equipment (“PPE”) and
Right-of-use assets
(“ROUA”)
– Parent company financial
statements: investments
in and debtors owed by
subsidiary undertakings
Refer to the Audit Committee
Report (page 90); Accounting
policies (pages 139, 144
and 201); Note 11 of the
Consolidated Financial
Statements and Notes 5 and
8 of the Company Financial
Statements
The Group Balance Sheet
includes goodwill, intangible
assets, PPE, and ROUA
totalling £456.7m (2023:
£475.0m). The Parent company
Balance Sheet includes
investments totalling £401.2m
(2023: £163.7m) and debtors
owned by subsidiary
undertakings of £380.5m
(2023: £581.9m).
Management perform an overall
assessment of impairment of
assets for each cash-generating
unit (“CGU”) – note each
operating company is a CGU
– annually in-line with the
requirements of IAS 36
Impairment of Assets, or
when there are indicators
of impairment.
The carrying value of assets
for each operating company
is compared to either the
value-in-use (‘VIU’) of the
operating company or the
fair-value less costs of disposal
(“FVLCD”) of the operating
company’s assets. Both
approaches contain significant
assumptions of estimation
uncertainty and judgement,
including use of prospective
financial information.
There is an associated risk in
the Parent company Balance
Sheet over the potential
impairment of investments
in subsidiary undertakings
and the recoverability of
receivables due from
subsidiary undertakings.
The risk has increased in the
current year due to a decline
in trading performance of
the Group.
We identified and walked through key controls in the impairment process identified by management, including the
budgeting process.
We evaluated management’s determination of CGUs by considering the interdependency or otherwise of cash flows
together with how management reports and monitors financial performance of its business operations. For each
CGU, we determined whether management were basing the impairment assessment on a VIU or FVLCD basis.
For each CGU assessed using VIU
We understood the methodology behind, and tested, the discounted cash-flow model used by management to perform
the impairment test for each of the relevant cash-generating units per the requirements of IAS 36 Impairment of Assets
(“IAS 36”).
We tested the key VIU assumptions (as explained below) and performed related sensitivities to determine whether
adequate headroom remains – using these sensitivities, we performed a ‘stand back’ assessment to consider
whether there is sufficient evidence to support management’s position.
We assessed the methodology against the requirements of IAS 36 and tested the integrity and clerical accuracy of
the VIU model.
Key Assumptions in the VIU Model
We evaluated the key underlying assumptions within the VIU calculation including the prospective financial
information and discount rates, as well as other assumptions such as long-term growth rates.
We evaluated independent market forecasts, to assess the revenue growth included in management’s budget
and medium-term plan and considered other matters such as the market conditions, geopolitical landscape, and
climate risks.
Prospective financial information
We challenged the underlying forecasts in management’s 2025 budgets and 2026-2027 medium-term plan.
Our challenge focused on the growth assumptions including the impact of initiatives to improve revenue and profit,
specifically comparing to industry forecasts, and considered management’s historical forecasting accuracy. As part
of this assessment we considered whether key drivers of growth in management’s model, such as volume growth,
margin improvement, and other initiatives, were reasonable or optimistic.
We assessed the discount rates applied with input from our internal valuation experts and benchmarked long-term
growth rates to external market forecasts.
We compared the VIU of each CGU as per the model computed by management to our independently assessed
range of possible outcomes and assessed whether this supported management’s conclusions and disclosures.
As a result, the sensitivity disclosures were updated in respect of certain CGUs.
For each CGU assessed using FVLCD
For UK Interiors and Benelux CGUs, management assessed the recoverable amount of individual classes of assets
on a FVLCD basis.
The key assumption used in the determination of FVLCD is the fair value of the ROUA, in particular in respect of
property. To do this, management obtained an independent external valuation report for the property assets held by
the CGUs which supported their assessment that the net book value was recoverable by considering the market
rental value that could be obtained from subleasing the properties and taking into account current market conditions
together with the location and condition of the properties.
We assessed the findings of management’s external valuation specialists primarily by engaging an internal valuation
specialist to corroborate that management’s specialist had the requisite qualifications to make the assessment, and
to determine their methodology used to be appropriate.
With input from our internal specialists, for a sample of leases, we assessed the key assumptions, including the
sublease rental value, potential vacant period, and costs of subletting. We also assessed that the contracts held by
management do not preclude subletting the properties and any relevant costs to dispose were appropriately
incorporated in the fair value.
We assessed recoverability of non-property assets, such as fleet ROUA and fixtures and fittings. The fleet assets
were impaired as there was no right to return or sublet the vehicle.
We performed data integrity testing on management’s schedule of properties/assets to assess whether the listing
was complete and accurate.
Group disclosures
We assessed the disclosures against the requirements of IAS 36, in particular the requirement to disclose further
sensitivities for CGUs where a reasonably possible change in a key assumption would cause an impairment. We
also assessed the disclosure within the key judgements and estimation uncertainty section of the Group financial
statements.
Parent company
We understood key changes in the value of investments versus prior year and assessed the accounting treatment of
capitalisation of intercompany loan balances with certain subsidiaries.
We assessed the principles of management’s forecast models to verify whether the appropriate cashflows were
being considered, using the VIU of the subsidiaries of the Group, and making appropriate adjustments such
as exclusion of lease liabilities and other debt.
We overlaid our estimated range of the VIU of the subsidiaries of the Group following challenge of the forecasts.
We identified a scenario whereby there could be a potential impairment of the Parent company investment balance
in a plausible downside scenario. As a result, the sensitivity disclosure included in the Parent company financial
statements was updated.
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SIG Annual Report and Accounts 2024
Key observations communicated to the Audit Committee
For the Group’s CGUs, we agree with management that it is reasonable not to recognise any impairment based on the VIU assessment. The most
significant judgement in the VIU assessment is the prospective financial information which include a number of initiatives to drive growth, notably in
2027 (the final year in management’s three-year medium-term plan as included in their VIU model). There are risks to effectively executing these
initiatives which could reduce the VIU. The disclosures included in the financial statements, to signpost potential scenarios that may result in an
impairment being reasonably possible, specifically in respect of the UK Specialist Markets, Miers Construction Products, Building Solutions and France
Roofing CGUs, are appropriate.
We agree with management’s conclusion to record an impairment against the fleet right-of-use assets of £7.3m in the UK Interiors CGU. We agree that
no other material impairment charge, or reversal of any existing impairment in the current year, is reasonable in respect of the impairment assessments
based on FVLCD.
We consider management’s assessment, that no impairment should be recorded against the Parent company investment balance, to be reasonable.
The sensitivity disclosure in the Parent company financial statements is appropriate.
Impairment disclosures in the Group and Parent company financial statements were appropriate and in accordance with the requirements of IAS 36.
How we scoped our audit to respond to the risk
All audit work performed to address this risk was undertaken by the Group audit team.
Risk
Our response to the risk
Misstatement of supplier
rebate income and
associated receivable
Refer to the Audit Committee
Report (page 90); Accounting
policies (pages 135 and 144);
and Notes 15 and 16 of the
Consolidated Financial
Statements
In 2024, income from Supplier
Rebates totalled £348.0m
(2023: £369.3m) with a
receivable balance as at
31 December 2024 of
£109.1m (2023: £106.9m).
The Group’s supply chain
pricing structure includes
rebate arrangements with
suppliers. The terms of
agreements with suppliers
can be complex and varied.
Estimation uncertainty is
present in relation to supplier
rebates, in particular where
amounts receivable are tiered
based on volumes purchased
or where volumes are estimated,
for example where arrangements
span the year end.
There is opportunity through
management override of
controls or error to overstate
the balance of supplier rebates
recognised. The risk identified
is primarily focused on
significant balances with
new agreements, changes in
agreements, and unconfirmed
balances at the year-end.
We focused our audit procedures on the areas where management apply judgement and estimation, where the
processing is either manual or more complex, and where the value is high. In particular, where amounts receivable
are tiered based on volumes purchased or where volumes are estimated, for example where arrangements span the
year end.
We performed walkthroughs to understand the key processes used to record supplier rebate transactions and
identified key controls.
We performed analytical reviews to understand unusual movements in income statement and balance sheet
accounts period on period, including ageing analysis.
We selected a sample of suppliers to test using a risk-based approach focusing on suppliers with a significant
receivables balance at year end, new agreements that are material and agreements with significant changes in
earnings versus the prior year.
For key items we obtained independent confirmations to confirm key terms, income recognised, and the year end
receivable. Using the confirmations received, we reconciled income recognised in the period and the receivable
recorded at the year end.
For others sampled, we:
– Obtained the rebate agreement signed by both parties and recalculated the earnings and receivable balances
based on the volumes in management’s data; and
– Where estimation was included (e.g. non-coterminous year-ends), we tested assumptions made to supporting
documentation; and
– Vouched whether there was a right to net settlement of the income and validated this was being appropriately
recorded; and
– Obtained any evidence of post year payments or credit notes received for any significant balances at year end.
We performed a stand back analysis to ensure the untested population was not material by bringing additional items
into scope of our testing or performing analytical procedures.
Using data extracted from the accounting system, we tested the appropriateness of a sample of journal entries,
focusing on manual journals, and other adjustments to supplier rebate accounts in the balance sheet and income
statement.
We reviewed the appropriateness of the critical accounting judgements and key sources of estimation uncertainty
disclosure in respect of supplier rebate amounts recorded in the income statement and balance sheet.
Key observations communicated to the Audit Committee
The income recognised in the year and the balance sheet position at year end are appropriately recorded. We reviewed the disclosures included within
the financial statements and consider them appropriate.
How we scoped our audit to respond to the risk and involvement with component teams
We performed full and specific scope audit procedures over this risk in 12 locations, which covered 99% of the risk amount associated to supplier
rebate income, and 97% of the risk amount associated to supplier rebates receivable. We provided detailed audit instructions to component teams to
ensure a uniform testing approach commensurate with the risk of material misstatement and reviewed the underlying workpapers to ensure adherence
to the approach.
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Independent auditors report continued
to the members of SIG plc
Our application of materiality
We apply the concept of materiality in planning and performing the audit, in evaluating the effect of identified misstatements on
the audit and in forming our audit opinion.
Materiality
The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably be expected to
influence the economic decisions of the users of the financial statements. Materiality provides a basis for determining
the nature and extent of our audit procedures.
We determined materiality for the Group to be £3.0m (2023: £2.8m), which is 0.5% of Group gross margin (2023: 5.0% of Group
underlying operating profit) which provides a materiality value comparable to both those used in the previous year and forecast
to be used in future years as and when trading conditions improve. We believe that Group gross margin provides us with a
relevant performance measure to the stakeholders of the Group that is broadly consistent (i.e., gross margin percentage of
sales is relatively stable) and is therefore an appropriate basis for materiality. We changed from using Group underlying
operating profit in the prior year due to the reduction and volatility in this metric.
We determined materiality for the Parent Company to be £3.9m (2023: £3.5m), which is 1.0% (2023: 1.0%) of shareholders
equity of £390.1m, however we have capped the materiality for our audit testing at the materiality of the Group.
During the course of our audit, we reassessed initial materiality based on the final Group gross margin outturn. This indicated a
higher materiality amount of £3.2m. Given this was not significantly different, we have maintained our materiality at the planned
amount above.
Performance materiality
The application of materiality at the individual account or balance level. It is set at an amount to reduce to an appropriately
low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality.
On the basis of our risk assessments, together with our assessment of the Group’s overall control environment, our judgement
was that performance materiality was 50% (2023: 50%) of our planning materiality, namely £1.5m (2023: £1.4m). We have set
performance materiality at this percentage due to our assessment of the control environment, the level of misstatements in the
prior year, and the outcome of our risk assessment.
Audit work was undertaken at component locations for the purpose of responding to the assessed risks of material misstatement
of the Group financial statements. The performance materiality set for each component is based on the relative scale and risk of
the component to the Group as a whole and our assessment of the risk of misstatement at that component. In the current year,
the range of performance materiality allocated to components was £0.3m to £0.6m (2023: £0.3m to £0.8m).
Reporting threshold
An amount below which identified misstatements are considered as being clearly trivial.
We agreed with the Audit Committee that we would report to them all uncorrected audit differences in excess of £0.15m
(2023: £0.14m), which is set at 5% of planning materiality, as well as differences below that threshold that, in our view, warranted
reporting on qualitative grounds.
We evaluate any uncorrected misstatements against both the quantitative measures of materiality discussed above and in light
of other relevant qualitative considerations in forming our opinion.
Other information
The other information comprises the information included in the annual report set out on pages 1 to 125, including the Strategic
Report and the Governance reports (Corporate Governance Report, Nominations Committee Report, Directors’ Report, Audit
and Risk Committee Report, Directors’ Remuneration Report, and Directors’ Responsibilities Statement), 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 this 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 the other information, we are required to report that fact.
We have nothing to report in this regard.
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SIG Annual Report and Accounts 2024
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.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Group and the parent company and its environment obtained in the
course of the audit, we have not identified material misstatements in the strategic report or the directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report
to you if, in our opinion:
–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 and the part of the Directors’ Remuneration Report to be audited are not in
agreement with the accounting records and returns; or
–certain disclosures of directors’ remuneration specified by law are not made; or
–we have not received all the information and explanations we require for our audit
Corporate Governance Statement
We have reviewed the directors’ statement in relation to going concern, longer-term viability and that part of the Corporate
Governance Statement relating to the Group and company’s compliance with the provisions of the UK Corporate Governance
Code specified for our review by the UK Listing Rules.
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 or our knowledge obtained during the audit:
–Directors’ statement with regards to the appropriateness of adopting the going concern basis of accounting and any material
uncertainties identified set out on page 59;
–Directors’ explanation as to its assessment of the company’s prospects, the period this assessment covers and why the
period is appropriate set out on page 59;
–Director’s statement on whether it has a reasonable expectation that the Group will be able to continue in operation and meets
its liabilities set out on page 59;
–Directors’ statement on fair, balanced and understandable set out on page 94;
–Board’s confirmation that it has carried out a robust assessment of the emerging and principal risks set out on pages 96 to 97;
–The section of the annual report that describes the review of effectiveness of risk management and internal control systems
set out on page 97; and
–The section describing the work of the audit committee set out on pages 88 to 95.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set out on page 125, 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 and 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.
193
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Financials
SIG Annual Report and Accounts 2024
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.
Explanation as to what extent 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 irregularities, including fraud. The risk of not detecting a material misstatement due
to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for
example, forgery or intentional misrepresentations, or through collusion. The extent to which our procedures are capable of
detecting irregularities, including fraud is detailed below.
However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of
the company and management.
–We obtained an understanding of the legal and regulatory frameworks that are applicable to the Group and determined that
the most significant are those which are directly relevant to the financial statements and those that relate to the reporting
framework (UK adopted international accounting standards, the Companies Act 2006 and the UK Corporate Governance
Code) and the relevant tax compliance regulations in the jurisdictions in which the Group operates. In addition, we concluded
that there are certain significant laws and regulations which may have an effect on the determination of the amounts and
disclosures in the financial statements being the Listing Rules of the UK Listing Authority, and those laws and regulations
relating to health and safety and employee matters.
–We understood how SIG plc is complying with those frameworks by making enquiries of management, internal audit, those
responsible for legal and compliance procedures, and the Company Secretary. We corroborated our inquiries through our
review of Board minutes and papers provided to the Audit Committee, and observation in Audit Committee meetings, as well
as consideration of the results of our audit procedures across the Group.
–We assessed the susceptibility of the Group’s financial statements to material misstatement, including how fraud might occur
by meeting with management from various parts of the business to understand where it considered there was a susceptibility
to fraud. We also considered the current challenging trading conditions and performance targets and their potential to
influence management to manage earnings or influence the perceptions of analysts. As a result of these procedures, we
determined there is a risk of fraud associated to supplier rebate income and associated receivable and revenue recognition
(manual adjustments). We considered the programmes and controls that the Group has established to address risks identified,
or that otherwise prevent, deter and detect fraud; and how senior management monitors those programmes and controls.
Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These
procedures were designed to provide reasonable assurance that the financial statements were free from fraud and error.
–Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations,
including providing specific instructions to full and specific scope component teams. Our procedures included journal entries
testing, with a focus on manual journal entries, consolidation journal entries and journal entries indicating large or unusual
transactions using data analytics. We based this testing on our understanding of the business, enquiries of management,
including internal audit, legal and other advisors, the company secretary and reading relevant reports. Through our testing we
challenged the assumptions and judgements made by management in respect of unusual or significant one-off transactions in
the year and significant accounting estimates as referred to in the key audit matters section above. At a component level, our
full and specific scope component audit team’s procedures included inquiries of component management, journal entry
testing, and detailed testing in respect of the identified fraud risks described above. We also leveraged our data analytics
platform in performing our work on the sales order to cash processes to assist in identifying higher risk transactions for
testing. We have also reviewed the whistleblowing reports issued during the year.
–In addition, we completed procedures to conclude on the compliance of the disclosures in the Annual Report and Accounts
with the requirements of the relevant accounting standards, UK legislation and the UK Corporate Governance Code.
–Specific inquiries were made with the component teams to confirm the details of any instances of non-compliance with
laws and regulations. This was reported via interoffice audit deliverables based on the procedures detailed in the previous
paragraph. Additionally, the Group audit team communicates any instances of non-compliance with laws and regulations
to component teams through regular interactions throughout the audit cycle. There were no instances of non-compliance
with laws and regulations that we concluded would have a material impact on the Group consolidated financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting
Council’s website at https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Independent auditors report continued
to the members of SIG plc
194
SIG Annual Report and Accounts 2024
Other matters we are required to address
–Following the recommendation from the audit committee we were appointed by the company 4 July 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 is seven years, covering the
years ending 31 December 2018 to 31 December 2024.
–The audit opinion is consistent with the additional report to the audit committee.
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.
Adrian Roberts
(Senior statutory auditor)
for and on behalf of Ernst & Young LLP, Statutory Auditor
Birmingham
4 March 2025
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Financials
SIG Annual Report and Accounts 2024
Five-year summary
Statutory basis
Total
2020
£m
Total
2021
£m
Total
2022
£m
Total
2023
£m
Total
2024
£m
Revenue
1,874.5
2,291.4
2,744.5
2,761.2
2,611.8
Operating (loss)/profit
(160.0)
14.0
56.2
4.0
(3.8)
Finance income
0.7
0.7
1.3
2.2
2.7
Finance costs
(35.3)
(30.6)
(30.0)
(38.1)
(43.7)
(Loss)/profit before tax
(194.6)
(15.9)
27.5
(31.9)
(44.8)
(Loss)/profit after tax
(201.2)
(28.3)
15.5
(43.4)
(48.6)
(Loss)/earnings per share (p)
(23.1)
(2.4)
1.3
(3.8)
(4.2)
Total dividend per share (p)
—
—
—
—
—
Underlying basis1
Underlying
2020
£m
Underlying
2021
£m
Underlying
2022
£m
Underlying
2023
£m
Underlying
2024
£m
Revenue
1,872.7
2,291.4
2,744.5
2,761.2
2,611.8
Operating (loss)/profit
(53.1)
41.4
80.2
53.1
25.1
Finance income
0.7
0.7
1.3
2.2
2.7
Finance costs
(23.7)
(22.8)
(29.9)
(37.9)
(42.1)
(Loss)/profit before tax
(76.1)
19.3
51.6
17.4
(14.3)
(Loss)/profit after tax
(86.8)
3.7
37.2
4.4
(19.7)
(Loss)/earnings per share (p)
(10.0)
0.3
3.2
0.4
(1.7)
1. Underlying represents the results before Other items. See Accounting policies for further details.
196
SIG Annual Report and Accounts 2024
Note
2024
£m
2023
£m
Fixed assets
Investments
5
401.2
163.7
Tangible fixed assets
6
0.4
0.5
Intangible assets
7
—
0.1
401.6
164.3
Current assets
Debtors: due within one year
8
353.1
503.7
Debtors: due after more than one year
8
30.1
80.5
Cash at bank and in hand
42.8
79.7
426.0
663.9
Current liabilities
Creditors: amounts falling due within one year
9
181.0
230.1
Net current assets
245.0
433.8
Total assets less current liabilities
646.6
598.1
Creditors: amounts falling due after one year
10
256.5
258.8
Net assets
390.1
339.3
Capital and reserves
Called up share capital
12
118.2
118.2
Treasury shares reserve
12
(8.6)
(11.6)
Merger reserve
12
104.0
104.0
Capital redemption reserve
12
0.3
0.3
Share option reserve
12
7.8
7.6
Exchange reserve
12
(0.2)
(0.2)
Cash flow hedging reserve
12
(1.3)
(1.2)
Cost of hedging reserve
12
0.1
0.1
Retained profits
12
169.8
122.1
Shareholders’ funds
390.1
339.3
The accompanying Accounting policies and Notes to the Company financial statements are an integral part of this Company
balance sheet.
As permitted by Section 408 of the Companies Act 2006 the Company has elected not to present its own Company income
statement for the year. SIG plc reported a profit after tax for the financial year ended 31 December 2024 of £47.7m (2023:
£91.5m loss).
The Financial statements were approved by the Board of Directors on 4 March 2025 and signed on its behalf by:
Gavin Slark
Ian Ashton
Director
Director
Registered in England: 00998314
Company balance sheet
as at 31 December 2024
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Financials
SIG Annual Report and Accounts 2024
Company statement of changes in equity
for the year ended 31 December 2024
Called up
share
capital
£m
Treasury
shares
reserve
£m
Merger
reserve
£m
Capital
redemption
reserve
£m
Share
option
reserve
£m
Exchange
reserve
£m
Cash flow
hedging
reserve
£m
Cost of
hedging
reserve
£m
Retained
profits/
(losses)
£m
Total
Equity
£m
At 1 January 2023
118.2
(16.4)
104.0
0.3
8.6
(0.2)
1.4
0.1
213.6
429.6
Loss after tax
—
—
—
—
—
—
—
—
(91.5)
(91.5)
Other comprehensive expense
—
—
—
—
—
—
(2.6)
—
—
(2.6)
Total comprehensive expense
—
—
—
—
—
—
(2.6)
—
(91.5)
(94.1)
Purchase of treasury shares
—
(1.7)
—
—
—
—
—
—
—
(1.7)
Credit to share option reserve
—
—
—
—
5.5
—
—
—
—
5.5
Settlement of share options
—
6.5
—
—
(6.5)
—
—
—
—
—
At 31 December 2023
118.2
(11.6)
104.0
0.3
7.6
(0.2)
(1.2)
0.1
122.1
339.3
Profit after tax
—
—
—
—
—
—
—
—
47.7
47.7
Other comprehensive expense
—
—
—
—
—
—
(0.1)
—
—
(0.1)
Total comprehensive (expense)/
income
—
—
—
—
—
—
(0.1)
—
47.7
47.6
Purchase of treasury shares
—
(0.9)
—
—
—
—
—
—
—
(0.9)
Credit to share option reserve
—
—
—
—
4.1
—
—
—
—
4.1
Settlement of share options
—
3.9
—
—
(3.9)
—
—
—
—
—
At 31 December 2024
118.2
(8.6)
104.0
0.3
7.8
(0.2)
(1.3)
0.1
169.8
390.1
The accompanying Accounting policies and Notes to the Company financial statements are an integral part of this Company
statement of changes in equity.
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SIG Annual Report and Accounts 2024
Basis of accounting
The separate financial statements of the Company are presented as required by the Companies Act 2006. They have been
prepared under the historical cost convention except for derivative financial instruments which are stated at their fair value.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date, regardless of whether that price is directly observable or estimated using another
valuation technique. In estimating the fair value of an asset or a liability, the Company takes into account the characteristics of
the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the
measurement date. Fair value for measurement purposes in these financial statements is determined on such a basis, except
for share-based payment transactions that are within the scope of IFRS 2, leasing transactions that are within the scope of IFRS
16, and measurements that have some similarities to fair value but are not fair value, such as net realisable value in IAS 2 or
value in use in IAS 36. Categorisation of fair value is set out in the Consolidated financial statements on pages 139 to 141.
The Company financial statements have been prepared in accordance with Financial Reporting Standard 101, Reduced
Disclosure Framework (FRS 101) and the Companies Act 2006 as applicable to companies using FRS 101. FRS 101 sets out a
reduced disclosure framework for a qualifying entity that would otherwise apply the recognition, measurement and disclosure
requirements of UK adopted international accounting standards in conformity with the requirements of the Companies Act
2006. The Company is a qualifying entity for the purposes of FRS 101.
Going concern
The Company closely monitors its funding position throughout the year, including monitoring compliance with covenants and
available facilities to ensure it has sufficient headroom to fund operations.
The Company’s financing facilities comprise €300m fixed rate secured notes, due October 2029, €13.5m fixed rate secured
notes, due November 2026, and a £90m Revolving Credit Facility (RCF) that expires in April 2029. The only financial covenant
within these facilities is a leverage maintenance covenant within the RCF, which is only effective if the facility is over 40% drawn
(i.e. £36m) at a quarter end reporting date. The RCF was undrawn at 31 December 2024 and has remained undrawn
subsequent to the year end.
The Company has significant available liquidity and on the basis of current forecasts is expected to remain in compliance with
all banking covenants throughout the forecast period to 31 March 2026 (the going concern period).
The Company has no trading operations and therefore its ability to continue as a going concern is dependent on the trading of
its subsidiaries and the forecasts for the Group as a whole. The Directors have considered the Group’s forecasts which support
the view that the Group and Company will be able to continue to operate within its banking facilities and comply with its banking
covenants. The Directors have considered the following principal risks and uncertainties that could potentially impact the Group
and Company’s ability to fund its future activities and adhere to its banking covenants, including:
–prolonged challenging trading conditions in the Group’s larger businesses, leading to lower volumes;
–pricing pressure on sales and modest net input cost deflation; and
–current economic and political uncertainties, potentially further impacting market demand.
The forecasts on which the going concern assessment is based have been subject to sensitivity analysis and stress testing to
assess the impact of the above risks and the Directors have also reviewed mitigating actions that could be taken. Details are set
out in the Group going concern assessment on page 132.
The Directors have considered the impact of climate-related matters, but the impact on the Company is not considered to
create any material uncertainties related to events or conditions that could cast significant doubt upon the Company’s ability
to continue as a going concern.
On consideration of the above, the Directors believe that the Company has adequate resources to continue in operational
existence for the forecast period to 31 March 2026 and the Directors therefore consider it appropriate to adopt the going
concern basis in preparing the 2024 Company financial statements.
New standards, interpretations and amendments adopted
A number of amendments and interpretations apply for the first time in 2024, but do not have an impact on the financial
statements of the Company. The Company has not early adopted any standards, interpretations or amendments that have
been issued but are not yet effective.
Company accounting policies
for the year ended 31 December 2024
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Exemptions applied in accordance with FRS 101
The following exemptions from the requirements of IFRS have been applied in the preparation of these financial statements,
in accordance with FRS 101:
–the requirements of paragraphs 45(b) and 46 to 52 of IFRS 2 Share-based Payment
–the requirements of IFRS 7 Financial Instruments: Disclosures
–the requirements of paragraphs 91 to 99 of IFRS 13 Fair Value Measurement
–the requirement in paragraph 38 of IAS 1 Presentation of Financial Statements to present comparative information in respect of:
(i) paragraph 79(a)(iv) of IAS 1 and
(ii) paragraph 73(e) of IAS 16 Property, Plant and Equipment
–the requirements of paragraphs 10(d), 10(f), 16, 38A to 38D, 40A to 40B, 111, and 134 to 136 of IAS 1 Presentation of
Financial Statements
–the requirements of IAS 7 Statement of Cash Flows
–the requirements of paragraphs 30 and 31 of IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors
–the requirements of paragraph 17 of IAS 24 Related Party Disclosures
–the requirements in IAS 24 Related Party Disclosures to disclose related party transactions entered into between two or more
members of a group
–the requirements of paragraphs 130(f)(ii), 130(f)(iii), 134(d) to 134(f) and 135(c) to 135(e) of IAS 36 Impairment of Assets.
Share-based payments
The accounting policy for share-based payments is consistent with that of the Group as detailed on page 136.
Derivative financial instruments
The accounting policy for derivative financial instruments is consistent with that of the Group as detailed on pages 140 and 141.
Financial assets and liabilities
The accounting policy for financial assets and liabilities is consistent with that of the Group as detailed on pages 139 and 140.
The Company has assessed on a forward-looking basis the expected credit losses associated with amounts owed by
subsidiary undertakings. The impairment methodology applied depends on the ability to repay amounts repayable on
demand and whether there has been any significant change in credit risk.
Investments
Fixed asset investments in subsidiaries are shown at cost less provision for impairment.
Tangible fixed assets
The accounting policy for tangible fixed assets is consistent with that of the Group as detailed on page 137.
Intangible assets
The accounting policy for intangible fixed assets is consistent with that of the Group as detailed on page 137.
Foreign currency
The accounting policy for foreign currency is consistent with that of the Group as detailed on page 134.
Taxation
The accounting policy for taxation is consistent with that of the Group as detailed on page 136.
Dividends
Dividends proposed by the Board of Directors that have not been paid by the end of the year are not recognised in the
Accounts until they have been approved by the Shareholders at the Annual General Meeting.
Critical accounting judgements and key sources of estimation uncertainty
In the application of the Company’s accounting policies, which are described above, the Directors are required to make
judgements (other than those involving estimates) that have a significant impact on the amounts recognised and to make
estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources.
The following are the critical judgements that the Directors have made in the process of applying the Company’s accounting
policies and that have had a significant effect on the amounts recognised in the financial statements. The judgements involving
estimations are dealt with separately below.
Company accounting policies continued
for the year ended 31 December 2024
200
SIG Annual Report and Accounts 2024
Recognition of deferred tax assets
Deferred tax assets are recognised for unused tax attributes to the extent that it is probable that taxable profit will be available
against which the attributes can be utilised, after consideration of available taxable temporary differences. The Company has
£11.3m (2023: £9.9m) of potential deferred tax assets relating to cumulative UK tax losses and other deductible timing
differences which are currently unrecognised as there is not considered to be sufficient convincing evidence at 31 December
2024 that sufficient future taxable profits will be available to allow the utilisation of the deductible temporary differences, in
particular given the cumulative historic and current year tax loss position in the UK. This required significant management
judgement to determine the likely timing and level of future taxable profits and whether sufficient, convincing evidence was
available at 31 December 2024 to recognise the previously unrecognised deferred tax assets. If the Company were able to
recognise all unrecognised deferred tax assets, profit and equity would have increased by £11.3m. Further details are disclosed
in Note 11.
The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying value of the
assets and liabilities recognised by the Company within the next financial year are detailed below.
Impairment of fixed asset investments
Determining whether the Company’s investments are impaired requires an estimation of the investments’ value in use. The key
estimates made in the value in use calculation in relation to trading subsidiaries are those regarding discount rates, sales growth
rates, gross margin and long-term operating profit growth. The Directors estimate discount rates using pre-tax rates that reflect
current market assessments of the time value of money for the Group.
The Company performs investment impairment reviews by forecasting cash flows based upon the following year’s budget as a
base, taking into account current economic conditions. The carrying amount of investments in subsidiaries at the balance sheet
date was £401.2m (2023: £163.7m).
Of the £401.2m net book value at 31 December 2024, £209.7m (2023: £159.8m) relates to the Company’s investment in SIG
Trading Limited, the largest UK trading subsidiary, and therefore assumptions regarding sales, gross margin and operating profit
growth of this subsidiary are considered to be the key areas of estimation in the impairment review process. At 31 December
2024 the carrying value is supported by the future operating cashflows and no further impairments are recognised. No reversal
of the previous impairment is recognised as there is insufficient evidence that the factors leading to the impairment in previous
years no longer exist and that the indicators of impairment reversal are sufficiently satisfied at 31 December 2024.
£187.5m (2023: £nil) of the investment net book value and of the additions in the year relates to SIG European Holdings Limited,
an intermediate holding company which indirectly holds investments in the SIG Group’s European trading subsidiaries.
At 31 December the carrying value is supported by the future operating cashflows of the underlying trading subsidiaries.
Whilst the Directors consider the assumptions used in the impairment review to be realistic, if actual results are different
from expectations, then it is possible that the value of the investment included on the Company balance sheet could become
impaired further. Further details on the assumptions used in the forecast future cash flows of the underlying operating
businesses of the relevant subsidiaries are provided in Note 11 of the Consolidated financial statements. The cash flows of SIG
Trading Limited comprise the CGUs of UK Interiors, UK Roofing, UK Specialist Markets, Miers Construction Products, Building
Solutions and Ireland. All other CGUs are included in the cash flows relevant to SIG European Holdings Limited. A 2.0%
reduction in forecast revenue in each year for each of the relevant operating companies, before considering any mitigations,
would not indicate any impairment in the investment in either SIG Trading Limited or SIG European Holdings Limited. Note 11
of the Consolidated financial statements shows the level of change in key assumptions required to lead to value in use of the
underlying subsidiaries to equal their carrying value. If the reductions shown for UK Specialist Markets, Miers Construction
Products and Building Solutions, each of which is noted individually as being a reasonably possible scenario, were all incurred
simultaneously, without considering any mitigations, this would lead to an impairment in the investment in SIG Trading Limited
of c£28m.
Impairment of amounts owed by subsidiary undertakings
At 31 December 2024 the Company has recognised amounts owed by subsidiary undertakings of £380.5m (2023: £581.9m).
The Company recognises an allowance for expected credit losses (ECLs) in relation to amounts owed by subsidiary undertakings
based on the ability to repay amounts repayable on demand and whether there has been any significant change in credit risk.
An ECL provision of £25.9m has been recognised at 31 December 2024 (2023: £83.8m) based on estimates regarding the
future cash flows from subsidiaries and taking account of the time value of money. Changes in the economic environment or
circumstances specific to individual subsidiaries could have an impact on recoverability of amounts included on the Company
balance sheet at 31 December 2024 and level of ECL provision required in the future.
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Notes to the Company financial statements
for the year ended 31 December 2024
1. Profit/(loss) for the year
As permitted by Section 408 of the Companies Act 2006 the Company has elected not to present its own Company income
statement for the year. SIG plc reported a profit after tax for the financial year ended 31 December 2024 of £47.7m (2023:
£91.5m loss).
The Auditor’s remuneration for audit and audit-related services to the Company was £1.3m (2023: £1.1m).
2. Share-based payments
The Company had three share-based payment schemes in existence during the year ended 31 December 2024 (2023: three).
The Company recognised a total credit to equity of £1.6m (2023: £1.8m) in the year relating to share-based payment
transactions. Details of each of the share-based payment schemes can be found in Note 9 to the Consolidated financial
statements.
3. Dividends
No interim dividend was paid during 2024 (2023: nil) and the Directors are not proposing a final dividend for the year ended
31 December 2024 (2023: no dividend). Total dividends paid during the year was £nil (2023: £nil). No dividends have been paid
between 31 December 2024 and the date of signing the Company financial statements.
See Note 12 for further details on distributable reserves.
4. Staff costs
Particulars of employees (including Directors and employees recharged to the Company from a UK subsidiary) are shown below:
2024
£m
2023
£m
Employee costs during the year amounted to:
Wages and salaries
6.2
7.2
Social security costs
0.8
1.2
IFRS 2 share-based payment expense
1.6
1.8
Pension costs
0.3
0.3
Total
8.9
10.5
The average monthly number of persons that these costs relate to is as follows:
2024
Number
2023
Number
Management and administration
49
57
5. Fixed asset investments
Fixed asset investments comprise investments in subsidiary undertakings, as follows:
2024
£m
2023
£m
Cost
At 1 January
650.9
650.9
Additions
237.5
—
At 31 December
888.4
650.9
Accumulated impairment charges
At 1 January
487.2
383.3
Impairment charge
—
103.9
At 31 December
487.2
487.2
Net book value
At 31 December
401.2
163.7
At 1 January
163.7
267.6
Details of the Company’s subsidiaries are shown on pages 206 to 208.
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SIG Annual Report and Accounts 2024
The additions in the year relate to the conversion into equity of intercompany loan balances with certain subsidiaries. The
Company subscribed for shares in SIG European Holdings Limted for £187.5m in July 2024 and in SIG Trading Limited for
£50.0m in December 2024, with the consideration offset against the existing amounts owed by these entities, resulting in
an increase in investments of £237.5m and a corresponding decrease in the balance owed from those subsidiaries.
Of the £401.2m (2023: £163.7m) investment net book value, £209.7m (2023: £159.8m) relates to SIG Trading Limited, the largest
UK trading subsidiary. At 31 December 2024 the carrying value is supported by the future operating cashflows of the subsidiary
and no further impairments are recognised. No reversal of the previous impairment is recognised as there is insufficient
evidence that the factors leading to the impairment in previous years no longer exist and that the indicators of impairment
reversal are sufficiently satisfied at 31 December 2024.
£187.5m (2023: £nil) of the investment net book value and of the additions in the year relates to SIG European Holdings Limited,
an intermediate holding company which indirectly holds investments in the European trading subsidiaries. At 31 December 2024
the carrying value is supported by the future operating cashflows of the underlying trading subsidiaries.
Further details on the assumptions used in the forecast future cash flows of the underlying operating businesses of the
subsidiaries are provided in Note 11 of the Consolidated financial statements. The cash flows of SIG Trading Limited comprise
the CGUs of UK Interiors, UK Roofing, UK Specialist Markets, Miers Construction Products, Building Solutions and Ireland. All
other CGUs are included in the cash flows relevant to SIG European Holdings Limited. Note 11 of the Consolidated financial
statements shows the level of change in key assumptions required to lead to value in use of the underlying subsidiaries to equal
their carrying value. If the reductions in revenue shown for UK Specialist Markets, Miers Construction Products and Building
Solutions, each of which is noted individually as being a reasonably possible scenario, were all incurred simultaneously, without
considering any mitigations, this would lead to an impairment in the investment in SIG Trading Limited of c£28m.
6. Tangible fixed assets
The movement in the year was as follows:
Freehold land
and buildings
£m
Leasehold
improvements
£m
Plant and
machinery
£m
Total
£m
Cost
At 1 January 2023, 31 December 2023 and 2024
0.1
0.6
0.7
1.4
Depreciation
At 1 January 2023
0.1
0.1
0.6
0.8
Charge for the year
—
0.1
—
0.1
At 31 December 2023
0.1
0.2
0.6
0.9
Charge for the year
—
0.1
—
0.1
At 31 December 2024
0.1
0.3
0.6
1.0
Net book value
At 31 December 2024
—
0.3
0.1
0.4
At 31 December 2023
—
0.4
0.1
0.5
7. Intangible fixed assets
The movement in the year was as follows:
Computer
software
£m
Total
£m
Cost
At 1 January 2023
1.0
1.0
Disposals
(0.1)
(0.1)
At 31 December 2023 and 2024
0.9
0.9
Depreciation
At 1 January 2023
0.7
0.7
Charge for the year
0.2
0.2
Disposals
(0.1)
(0.1)
At 31 December 2023
0.8
0.8
Charge for the year
0.1
0.1
At 31 December 2024
0.9
0.9
Net book value
At 31 December 2024
—
—
At 31 December 2023
0.1
0.1
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8. Debtors
2024
£m
2023
£m
Amounts owed by subsidiary undertakings
350.5
501.4
Derivative financial instruments
0.1
—
Prepayments
2.5
2.3
Debtors: due within one year
353.1
503.7
Amounts owed by subsidiary undertakings
30.0
80.5
Derivative financial instruments
0.1
—
Debtors: due after more than one year
30.1
80.5
Total
383.2
584.2
The Group recognises an allowance for ECLs in relation to amounts owed by subsidiary undertakings based on the ability to
repay amounts repayable on demand and whether there has been any significant change in credit risk. An ECL provision of
£25.9m (2023: £83.8m) has been recognised at 31 December 2024 based on estimates regarding the future cash flows from
subsidiaries and taking account of the time value of money.
Amounts owed by subsidiary undertakings are measured at amortised cost and bear interest at rates between 0% and 8.0%. The
amounts owed by subsidiary undertakings due after more than one year bear interest at 8.1% and are repayable on 1 January 2031.
9. Creditors: amounts falling due within one year
2024
£m
2023
£m
Amounts owed to subsidiary undertakings
168.0
219.7
Derivative financial instruments
1.3
1.0
Accruals and other payables
7.3
9.4
Accrued interest on secured notes (see Note 10)
4.4
—
Total
181.0
230.1
Amounts owed to subsidiary undertakings are measured at amortised cost, are unsecured and bear interest at rates between
0% and 7.25%.
10. Creditors: amounts falling due after one year
2024
£m
2023
£m
Secured notes
256.4
258.7
Derivative financial instruments
0.1
0.1
Total
256.5
258.8
Secured notes
In October 2024 the Group completed a refinancing of its debt arrangements. The previous €300m secured notes (fixed coupon
5.25% due November 2026) were tendered, at par, with €286.5m repaid, leaving €13.5m outstanding, and €300m new secured
notes were issued with a fixed coupon of 9.75%, due October 2029. The notes are guaranteed by certain subsidiaries of the
Group and are secured by a first priority floating charge over the assets of the Company and the relevant UK subsidiaries and by
a security interest over the shares, material bank accounts and intercompany receivables of the non-UK guarantor subsidiaries.
The notes are recognised at amortised cost, net of arrangement fees of which £2.7m is unamortised at 31 December 2024
(2023: £1.5m).
The contractual repayment profile of the secured notes is shown below:
2024
2023
£m
Fixed interest
rate
%
£m
Fixed interest
rate
%
Total gross amount repayable in 2026
11.2
5.25%
260.2
5.25%
Total gross amount repayable in 2029
247.9
9.75%
—
—
Unamortised fees
(2.7)
(1.5)
Secured notes due after more than one year
256.4
258.7
Accrued interest repayable within one year1
4.4
—
Total secured notes
260.8
258.7
1. Accrued interest on the secured notes of £1.1m was included within accruals and other payables at 31 December 2023. Following the change in timing of payment
and increase in amount as a result of the refinancing in October 2024 this is now presented separately at 31 December 2024.
Notes to the Company financial statements
for the year ended 31 December 2024
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SIG Annual Report and Accounts 2024
11. Deferred tax
Deferred tax has not been recognised on trading losses and other deductible temporary differences of £45.2m (2023: £39.4m)
on the basis that the realisation of their future economic benefit is uncertain. The unrecognised potential deferred tax asset in
relation to this is £11.3m (2023: £9.9m). At the balance sheet date, there are no aggregate temporary differences associated
with investments in subsidiaries for which deferred tax liabilities have not been recognised.
12. Capital and Reserves
a) Called up share capital
2024
£m
2023
£m
Authorised:
1,390,000,000 ordinary shares of 10p each (2023: 1,390,000,000)
139.0
139.0
Allotted, called up and fully paid:
1,181,556,977 ordinary shares of 10p each (2023: 1,181,556,977)
118.2
118.2
During 2024 the Company allotted no shares (2023: no shares) from the exercise of share options.
b) Treasury shares
Treasury shares relate to shares purchased by the EBT to satisfy awards made under the Group’s share plans which are not
vested and beneficially owned by employees. 3,001,375 (2023: 5,901,425) shares were purchased during the year at a weighted
average cost of 28.7p (2023: 28.9p) per share, and 8,808,795 (2023:13,357,702) shares were issued relating to the settlement of
share awards. A total of 20,614,080 own shares are outstanding at 31 December 2024 (2023: 26,421,500).
c) Reserves
Details of all movements in reserves are shown in the Company statement of changes in equity.
The share option reserve represents the cumulative equity-settled share option charge under IFRS 2 “Share-based payments”
less the value of any share options that have been exercised, including amounts relating to employees of subsidiaries which are
recharged to subsidiaries.
The cash flow hedging and cost of hedging reserves represents movements in the Consolidated balance sheet as a result of
movements in the fair value of cash flow hedges which are taken directly to reserves as detailed in the Accounting policies.
The merger reserve principally represents the premium on ordinary shares issued during a prior year through the use of a cash
box structure.
The Company maintains its positive distributable reserves position and continues to review the Group structure to optimise
reserves. At 31 December 2024 the company had distributable reserves of £266.1m (2023: £145.6m).
13. Guarantees and contingent liabilities
a) Guarantees
At 31 December 2024 the Company had provided guarantees of £nil (2023: £nil) on behalf of its subsidiary undertakings.
b) Contingent liabilities
As at the balance sheet date, the Company had outstanding obligations under a standby letter of credit of up to £4.3m
(2023: £6.1m). This standby letter of credit, issued by HSBC Bank plc, is in respect of the Group’s insurance arrangements.
14. Related party transactions
Remuneration of key management personnel
The total remuneration of the Directors of the Group Board, who the Group considered to be its key management personnel,
is provided in Note 4 of the Consolidated financial statements. In addition, the Company recognised a share-based payment
charge under IFRS 2 of £1.6m (2023: £1.8m) with a credit to the share option reserve of £1.6m (2023: £1.8m).
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Other information
Group companies 2024
This Note provides a full list of the related undertakings of SIG plc. In accordance with Section 409 of the CA 2006 and Schedule 4
of The Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 a full list of related
undertakings as at 31 December 2024 is disclosed below. Unless otherwise stated, the share capital disclosed comprises
ordinary or common shares which are held by subsidiaries of SIG plc.
Group companies
Fully owned subsidiaries (United Kingdom)
A. M. Proos & Sons Limited (England) (ii) (xxii)
A. Steadman & Son (Holdings) Limited (England) (ii) (xxii)
A. Steadman & Son Limited (England) (ii) (xxii)
Aaron Roofing Supplies Limited (England) (ii) (xxii)
Acoustic and Insulation Manufacturing Limited (England)
(ii) (xxii)
Advanced Cladding & Insulation Group Limited (England)
(ii) (xxii)
Ainsworth Insulation Limited (England) (ii) (xi)
Ainsworth Insulation Supplies Limited (England) (ii) (xiii)
AIS Insulation Supplies Limited (England) (ii) (xxii)
Asphaltic Roofing Supplies Limited (England) (ii) (xxii)
Auron Limited (England) (ii) (xix)
BBM (Materials) Limited (England) (ii) (xxii)
Bowller Group Limited (England) (ii) (xxii)
Building Solutions (National) Limited (England) (xxii)
Cairns Roofing and Building Merchants Limited (England)
(ii) (xxii)
Cheshire Roofing Supplies Limited (England) (ii) (xxii)
Clydesdale Roofing Supplies (Leyland) Limited (England)
(ii) (xxii)
CMS Danskin Acoustics Limited (England) (ii) (xxii)
Coleman Roofing Supplies Limited (England) (ii) (xxii)
Complete Construction Products Limited (England) (xxii)
CPD Distribution plc (England) (ii) (xxii)
Dane Weller Holdings Limited (England) (ii) (xxii)
Danskin Flooring Systems Limited (Scotland) (ii) (xxii)
Davies & Tate plc (England) (ii) (xxii)
Euroform Products Limited (England) (ii) (xxii)
F30 Building Products Limited (England) (xxii)
Fibreglass Insulations Limited (England) (ii) (xxii)
Flex-R Limited (England) (ii) (ix)
Formerton Limited (England) (ii) (xxii)
Formerton Sheet Sales Limited (England) (ii) (xxii)
Gutters & Ladders (1968) Limited (England) (ii) (xxii)
HHI Building Products Limited (Northern Ireland) (ii) (xxii)
Insulation & Machining Services Limited (England) (ii) (v)
Insulslab Limited (England) (ii) (xxii)
John Hughes (Roofing Merchant) Limited (England) (ii) (xxii)
John Hughes (Wigan) Limited (England) (ii) (xxii)
Jordan Wedge Limited (England) (ii) (xxii)
Kesteven Roofing Centre Limited (England) (ii) (xxii)
Kestral Construction Products Limited (England) (xxii)
Kitson’s Thermal Supplies Limited (England) (ii) (v)
Leaderflush+Shapland Holdings Limited(England) (ii)(xxii)
Lifestyle Partitions and Furniture Limited (England) (ii) (vi)
London Insulation Supplies Limited (England) (ii) (xxii)
MacGregor & Moir Limited (Scotland) (ii) (xxii)
Mayplas Limited (England) (ii) (ix)
MCP Fixings Limited ((England) (xxii)
Miers Construction Products Limited (England) (xxii)
Ockwells Limited (England) (ii) (vii)
Omnico (Developments) Limited (England) (ii) (xxii)
Omnico Plastics Limited (England) (ii) (xxii)
One Stop Roofing Centre Limited (England) (ii) (xxii)
Orion Trent Holdings Limited (England) (ii) (xvii)
Orion Trent Limited (England) (ii) (xi)
Penlaw & Company Limited (England) (xxii)
Penlaw Fixings Limited (England) (xxii)
Penlaw Norfolk Limited (England) (xxii)
Penlaw Northwest Limited (England) (xxii)
Roberts & Burling Roofing Supplies Limited (England) (ii) (xxii)
Roof Shop Limited (England) (ii) (xxii)
Roofing Centre Group Limited (England) (ii) (xxii)
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SIG Annual Report and Accounts 2024
Roofing Material Supplies Limited (England) (ii) (xxii)
Scotplas Limited (England) (ii) (xxii)
Sheffield Insulations Limited (England) (i) (ii) (xxiii)
Shropshire Roofing Supplies Limited (England) (ii) (xxii)
SIG Building Solutions Limited (England) (ii) (xxii)
SIG Building Systems Limited (England) (ii) (xxii)
SIG Dormant Company Number Eight Limited (England) (ii) (iv)
SIG Dormant Company Number Eleven Limited (England)
(ii) (xxii)
SIG Dormant Company Number Seven Limited (England) (i)
(ii) (xxii)
SIG Dormant Company Number Six Limited (England) (ii) (xxii)
SIG Dormant Company Number Ten Limited (England) (i)
(ii) (xvii)
SIG Dormant Company Number Three Limited (England) (i)
(ii) (xxii)
SIG EST Trustees Limited (England) (i) (ii) (xxii)
SIG European Holdings Limited (England) (i) (xxii)
SIG European Investments Limited (England) (xxii)
SIG Group Life Assurance Scheme Trustees Limited (England)
(ii) (xxii)
SIG (IFC) Limited (England) (xxii)
SIG International Trading Limited (England) (i) (xxii)
SIG Logistics Limited (England) (ii) (xxii)
SIG Manufacturing Limited (England) (ii)(xxii)
SIG Retirement Benefits Plan Trustee Limited (England)
(i) (ii) (xxii)
SIG Roofing Supplies Limited (England) (i) (ii) (xxii)
SIG Scots Co Limited (Scotland) (i) (xxii)
SIG Specialist Construction Products Limited (England)
(ii) (xxii)
SIG Trading Limited (England) (i) (xxii)
S M Roofing Supplies Limited (England) (xxii)
Solent Insulation Supplies Limited (England) (ii) (xxii)
South Coast Roofing Supplies Limited (England) (ii) (xxii)
Specialised Fixings Limited (England) (ii) (xxii)
Specialist Fixings and Construction Products Limited (ii) (xxii)
Support Site Limited (England) (i) (ii) (xxii)
Tenon Partition Systems Limited (England) (ii) (xxii)
The Coleman Group Limited (England) (ii) (xviii)
The Greenjackets Roofing Services Limited (England) (ii) (xv)
Thomas Smith (Roofing Centres) Limited (England) (ii) (xxii)
Trent Insulations Limited (England) (ii) (xxii)
Trimform Products Limited (England) (ii) (xxii)
Undercover Holdings Limited (England) (ii) (xxii)
Undercover Roofing Supplies Limited (England) (ii) (v)
United Roofing Products Limited (England) (ii) (xxii)
Wedge Roofing Centres Holdings Limited (England) (ii) (xxii)
Wedge Roofing Centres Limited (England) (ii) (xxii)
Weymead Holdings Limited (England) (ii) (xv)
Window Fitters Mate Limited (England) (ii) (xxii)
Woods Insulation Limited (England) (ii) (xxii)
Zip Screens Limited (England) (i) (ii) (xxii)
Fully owned limited partnership
The 2018 SIG Scottish Limited Partnership (Scotland) (xxi)
Controlling interests (United Kingdom)
Passive Fire Protection (PFP) UK Limited (England) (51%) (ii)
Registered Office Address: Adsetts House, 16 Europa View,
Sheffield Business Park, Sheffield, S9 1 XH, United Kingdom
Fully owned subsidiaries (overseas) (including registered
office addresses)
Gate Pizzaras SL (Spain) – Ponferrada, Villamartin Leon, Spain
Isolatec b.v.b.a. (Belgium) – Scheepvaartkaai 5, Hasselt 3500,
Belgium
J S McCarthy Limited (Ireland) (vii) – Ballymount Retail Centre,
Ballymount Road Lower, Dublin 24, Ireland
Larivière S.A.S. (France) – 3 rue Jean Zay – 49100, Angers,
France
LiTT Diffusion S.A.S. (France) – 40 rue Gabriel Crie – 92240
Malakoff, France
SIG Supply Solutions S.A.S. (France) – 40 rue Gabriel Crie
– 92240 Malakoff, France
Meldertse Plafonneerartikelen N.V. (Belgium) – Bosstraat 60,
3560 Lummen, Belgium
MIT International Trade S.L (Spain) – Carretera Sarria a
Vallvidrera 259, Local 08017, Barcelona, Spain
SIG Belgium Holdings N.V. (Belgium) – Bosstraat 60, 3560
Lummen, Belgium
207
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Governance
Financials
SIG Annual Report and Accounts 2024
Fully owned subsidiaries (overseas) (including registered
office addresses) continued
SIG Building Products Limited (Ireland) (ii) (xxv) – Ballymount
Retail Centre, Ballymount Road Lower, Dublin 24, Ireland
SIG Construction GmbH (Germany) – Maybachstrasse 14,
63456 Hanau- Steinheim, Germany
SIG Financing (Jersey) Limited (Jersey) – 44 Esplanade, St
Helier, JE4 9WG, Jersey
SIG France S.A.S. (France) – 40 rue Gabriel Crie, 92240
Malakoff, France
SIG Germany GmbH (Germany) – Maybachstrasse 14, 63456
Hanau- Steinheim, Germany
SIG Holdings B.V. (The Netherlands) – Industrieweg 17, 5145
PD Waalwijk, The Netherlands
SIG Nederland B.V. (The Netherlands) – Industrieweg 17, 5145
PD Waalwijk, The Netherlands
SIG Property GmbH (Germany) – Maybachstrasse 14, 63456
Hanau-Steinheim, Germany
SIG Trading (Ireland) Limited (Ireland) (viii) – Ballymount Retail
Centre, Ballymount Road Lower, Dublin 24, Ireland
SIG Sp. z.o.o. (Poland) – ul. Kamienskiego 51, 30-644 Krakow,
Poland Sitaco Sp. z.o.o. (Poland) – ul. Kamienskiego 51,
30-644 Krakow, Poland
Sitaco Spolka z ograniczona odpowiedzialnością sp.k.
(Poland) – ul. Kamienskiego 51, 30-644 Krakow, Poland
WeGo Systembaustoffe GmbH (Germany) – Maybachstrasse
14, 63456 Hanau-Steinheim, Germany
Notes
(i)
Directly owned by SIG plc
(ii)
Dormant company
(iii)
Ownership held in cumulative preference shares
(iv)
Ownership held in ordinary shares and 12% cumulative
redeemable preference shares
(v)
Ownership held in ordinary shares and preference shares
(vi)
Ownership held in ordinary shares and deferred
ordinary shares
(vii) Ownership held in ordinary shares and class A
ordinary shares
(viii) Ownership held in ordinary shares and class B
ordinary shares
(ix) Ownership held in ordinary shares, class A ordinary
shares and class B ordinary shares
(x)
Ownership held in ordinary shares, class B ordinary
shares and class C ordinary shares
(xi) Ownership held in ordinary shares, class A ordinary
shares, class B ordinary shares and class C ordinary
shares
(xii) Ownership held in ordinary shares and class E ordinary
shares
(xiii) Ownership held in ordinary shares, class A ordinary
shares, class B ordinary shares, class C ordinary shares,
class D ordinary shares, class E ordinary shares, class F
ordinary shares and class G ordinary shares
(xiv) Ownership held in class A ordinary shares
(xv) Ownership held in class A ordinary shares and class B
ordinary shares
(xvi) Ownership held in class A ordinary shares, class B
ordinary shares and class C ordinary shares
(xvii) Ownership held in class A ordinary shares, class B
ordinary shares and preference shares
(xviii) Ownership held in class A ordinary shares, class B
ordinary shares and cumulative redeemable
preference shares
(xix) Ownership held in class B ordinary shares and
preference shares
(xx) Ownership held in class AA ordinary shares, class AB
ordinary shares, class AC ordinary shares, class AD
ordinary shares, class AE ordinary shares, class AF
ordinary shares, class AG ordinary shares, class B
ordinary shares and class C ordinary shares
(xxi) Limited partner SIG Retirement Benefit Plan
Trustee Limited
(xxii) Ownership held in ordinary shares
(xxiii) Ownership held in ordinary shares and cumulative
preference shares
(xxiv) Ownership held in ordinary shares, preference shares
and redeemable preference shares
(xxv) Ownership held in class A ordinary shares, class B
ordinary shares, class C ordinary shares, class D
ordinary shares, class E ordinary shares, class F
ordinary shares and class C redeemable ordinary shares.
Group companies 2024 continued
Other information continued
208
SIG Annual Report and Accounts 2024
Shareholder analysis at 31 December 2024
Size of shareholding
Number of
shareholders
%
Number of
ordinary shares
%
0 – 999
527
35.13%
200,527
0.02%
1,000 – 4,999
518
34.53%
1,168,853
0.10%
5,000 – 9,999
139
9.27%
931,889
0.08%
10,000 – 99,999
162
10.80%
5,489,166
0.46%
100,000 – 249,999
32
2.13%
5,026,588
0.43%
250,000 – 499,999
23
1.53%
8,257,291
0.70%
500,000 – 999,999
27
1.80%
18,477,724
1.56%
1,000,000 +
72
4.80%
1,142,004,939
96.65%
Total
1,500
100% 1,181,556,977
100%
Company information
Financial calendar
Annual General Meeting
Thursday 1 May 2025
Interim results 2025
Tuesday 5 August 2025
Full-year results 2025
March 2026
Annual Report and Accounts 2025
posted to shareholders
March 2026
Group General Counsel &
Company Secretary
Andrew Watkins
Registered number
Registered in England 00998314
Corporate and Registered office
Adsetts House
16 Europa View
Sheffield Business Park
Sheffield S9 1XH
Tel: +44 (0) 114 285 6300
Email: info@sigplc.com
Company website
www.sigplc.com
Listing details
Market Reference Sector
UK Listed
SHI.L Support Services
Registrars and transfer office
Computershare Investor Services PLC
The Pavilions
Bridgwater Road
Bristol BS99 6ZY
Auditor
Ernst & Young LLP
1 More London Place
London SE1 2AF
Solicitors
Ashurst LLP
Fruit & Wool Exchange
1 Duval Square
London E1 6PW
Principal bankers
National Westminster Bank plc
250 Bishopsgate
London EC2M 4AA
Barclays Bank plc
Level 25
1 Churchill Place
London E14 5HP
BNP Paribas
London Branch
10 Harewood Avenue
London NW1 6AA
Lloyds Bank plc
1 Lovell Park Road
Leeds LS1 2HL
HSBC UK Bank plc
4th Floor City Point
Leeds LS2 8DA
Joint Stockbrokers
Peel Hunt LLP
100 Liverpool Street
London EC2M 2AT
Investec Bank plc
30 Gresham Street
London EC2V 7QP
Financial public relations
FTI Consulting LLP 200
Aldersgate Street
London EC1A 4HD
Shareholder enquiries
Our share register is managed by
Computershare, who can be contacted
by telephone on:
Overseas callers* +44 370 707 1293
24-hour helpline* 0370 707 1293
Text phone
0370 702 0005
*Operator assistance available between 08:30 and
17:30 UK time each business day.
Email: Access the Computershare
website www-uk.computershare.com/
Investor and click on ‘Contact Us’, from
where you can email Computershare.
Post: Computershare, The Pavilions,
Bridgwater Road, Bristol BS99 6ZY,
United Kingdom.
209
Strategic Report
Governance
Financials
SIG Annual Report and Accounts 2024
210
SIG Annual Report and Accounts 2024
Designed and produced by Instinctif Partners www.creative.instinctif.com
Website and electronic
communications
Shareholders receive notification of
the availability of the results to view
or download on the Group’s website
www.sigplc.com, unless they have
elected to receive a printed version
of the results.
We encourage our shareholders to
accept all shareholder communications
and documents electronically instead of
receiving paper copies by post as this
helps to reduce the environmental
impact by saving on paper and also
reduces distribution costs.
If you sign up to electronic communications,
instead of receiving paper copies of
the annual financial results, notices
of shareholder meetings and other
shareholder documents through the
post, you will receive an email to let you
know this information is on our website.
If you would like to sign up to receive
all future shareholder communications
electronically, please register through
our registrars Computershare at
www.investorcentre.co.uk/ecomms.
Registered office
Adsetts House
16 Europa View
Sheffield Business Park
Sheffield S9 1XH
T: +44 (0) 114 285 6300
E: info@sigplc.com
www.sigplc.com
Registered number:
00998314
Registered in England
SIG plc Annual Report and Accounts 2024