F e n ci n g | R ai n w

ki n g | D o o r s | R o o ﬁ n g | R o o ﬂi n e | F

w at er | F e nci n g | D ec

w at er | F e nci n g | D ec k

ki n g | R o o ﬁ n g | F e nci n g | R ai n w

k i n g | R o o ﬁ n g | F e nci n g | R ai n w

w at er | F e nci n g | D ec k

e nci n g | Cl a d di n g | R ai n w

e nci n g | D ec k

A n n u al R e p o rt

a n d A c c o u nt s

2 0 2 4

E ur o c ell pl c A n n u al R e p ort a n d A c c o u nt s 2 0 2 4

Revenue

£ 3 57.9 m

-2%

(2023: £364.5m)

Gross Margin

52.6%

490bps

(20 23: 47.7%)

Profit Before Tax

£13.8m

£ 2.1m

(2023: £11.7m)

Adjusted Profit

Before Tax

£20.0m

£4.8m

(2023: £15.2m)

Adjusted Basic

Earnings Per Share

14.4p

3.4p

(2023: 11.0p)

Basic Earnings

Per Share

9.8p

1.2p

(2023: 8.6p)

Operating Profit

£16.6m

£1.7m

(2023: £14.9m)

Adjusted Operating Profit

£22.8m

24%

(2023: £18.4m)

2024 HIGHLIGHTS

We have a clear purpose that shapes

our strategic decisions

See our strategy in action on pages 14 to 21

Creating sustainable

building solutions for

the trade of today,

the homes of tomorrow

and the environment

of the future

Learn about our progress on our

sustainability goals on pages 22 to 39

Understand our customer growth

initiatives on pages 16 and 17

WELCOME

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 01

CONTENTS

Strategic Report

Our Business at a Glance ........................................................ 02

What We Do ............................................................................ 04

Chair’s Statement .................................................................... 06

Market Overview ...................................................................... 08

Chief Executive’s Review ......................................................... 10

Our Strategy ............................................................................ 14

Sustainability Report ................................................................ 22

Task Force On Climate-related Financial Disclosures ................ 40

Chief Financial Officer’s Review ................................................ 52

Risk Management .................................................................... 56

Principal Risks and Uncertainties ............................................. 58

Viability Statement ................................................................... 63

Corporate Governance

Board of Directors ................................................................... 64

Executive Committee ............................................................... 66

Letter from the Chair ............................................................... 67

Corporate Governance Statement .......................................... 68

Nomination Committee Report ............................................... 77

Audit and Risk Committee Report ........................................... 82

Social Values and ESG Committee Report ............................... 88

Directors’ Remuneration Report .............................................. 90

Directors’ Report ....................................................................11 2

Statement of Directors’ Responsibilities ..................................116

Financial Statements

Independent Auditors’ Report ................................................ 11 8

Consolidated Statement of Comprehensive Income .............. 126

Consolidated Statement of Financial Position ........................ 127

Consolidated Cash Flow Statement ....................................... 128

Consolidated Statement of Changes in Equity ....................... 129

Notes to the Consolidated Financial Statements .................... 130

Company Statement of Financial Position .............................. 164

Company Statement of Changes in Equity ............................. 165

Notes to the Company Financial Statements ......................... 166

Company Information ............................................................ 173

View the latest results online at

investors.eurocell.co.uk

Net Debt

£62.5m

£4.3m

(2023: £58.2m)

1 Adjusted measures are stated before non-underlying items

and the related tax effect (see page 52). We use alternative

performance measures to assess business performance

and they are provided here in addition to statutory measures

to help describe the underlying results of the Group.

Pre-IFRS 16

Net Debt

£3.1m

-£3.5m

(2023: Net Cash £0.4m)

Our core strengths

Underpinned by our values

Read about our sustainable goals on page 24

Eurocell plc Annual Report and Accounts 202402 Eurocell plc Annual Report and Accounts 202402

OUR BUSINESS

AT A GLANCE

We are the UK’s market-leading manufacturer,

distributor and recycler of innovative

PVCwindow, door and roofline products.

Recycling at the

heart of operations

Our two recycling facilities produce materials, which are

used togenerate brand new extruded rigid PVC profiles.

We recycle factory offcuts and old windows that have

been replaced with new, into reusable raw materials for

ourmanufacturing process, putting recycling at the heart

ofouroperation.

Manufacturing

expertise

Our centrally located facilities manufacture PVC profile for use

in building products such as windows (rigid profile) and roofline

(foam profile), using raw materials including PVC resin and

recycled materials produced in our own plants.

We have specialist manufacturing sites for secondary

operations, including foiling, conservatory roofs, entrance doors

and injection moulding products, along with a technical centre

for innovation and product development.

50 years

PVC extrusion knowledge

and expertise

32%

Proportion of recycled

material used in extrusion

See how our branch network is evolving through

our Strategy report on pages 19 and 20

Read more about our culture on pages 27 to 29

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 03

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 03

Nationwide

Branch Network

We distribute our foam profile products (such as roofline,

facias and soffits) and entrance doors, along with a range

ofthird-party products, via our nationwide network of over

200branches.

Our Branch Network sells windows, made by our fabricator

partners using our manufactured window profile.

212

Number of branches

at 31 December 2024

State-of-the-art

distribution centre

We operate a state-of-the-art central warehouse,

with cantilever racking and mobile platform picking,

plus a fleet of 250 road vehicles.

260,000sq ft

Bespoke state-of-the-art

warehouse

We operate a vertically integrated business

model with a differentiated customer proposition

for fabricators, installers, housebuilders,

andsmallindependent builders.

Eurocell plc Annual Report and Accounts 202404 Eurocell plc Annual Report and Accounts 202404

10%

80%

Window profile Doors Roofs

WHAT WE DO

We operate our business through two divisions that

reflect the principal routes to market for our products.

Profiles Division

Product range

Profiles Division

– product mix (%)

Window and Door Profile

(rigid profile)

Patio Doors

Bi-fold DoorsComposite and PVC Entrance Doors

(Vista Doors brand)

MARKET-LEADING

PRODUCTS

Conservatory Roofs

Customer base

Cavity Closers

Injection Moulding Products

(S&S Plastics brand)

Third-party window and door

fabricators:

• Trade frame fabricators: supply

finished products to tradesmen or

small retail outlets

• New build fabricators: supply and

install products for housebuilders

• Commercial fabricators: supply

and install products for office spaces

and education facilities.

Fabricators have production

facilities which are customised to the

window or door system they make.

We form strong partnerships with

ourfabricators creating a stable and

loyal customer base.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 05

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 05

Fascias, Soffits and Trims

Cladding

Fencing

Rainwater andDrainage Sealants andCleaners

Composite Decking

Windows Entrance Doors

Extended Living Products

(garden rooms and extensions)

Conservatories and

Conservatory Roofs

Branch Network Division

30%

45%

Manufactured products

Traded goods

Made-to-order

25%

Branch Network Division

– product mix (%)

Manufactured products

Made-to-order products

Traded goods

Customer base

• Window and roofline installers

• Small and independent builders

• Nationwide maintenance

companies

• Independent wholesalers

(roofline only).

CHAIR’S STATEMENT

The Group has delivered

aresilient performancewith

adjusted profits in line

withmarket expectations

andahead of 2023.”

The last twelve months saw the persistence

of weak macroeconomic conditions and

declining consumer confidence, leading

to significant challenges in our markets.

Against this backdrop, Eurocell launched an

ambitious five-year strategy and the Group

delivered a resilient financial performance,

with adjusted profits in line with market

expectations and ahead of 2023.

The progress we are making in the business

is testament to the commitment, hard work

and dedication of our teams in every part of

the Group, and I would like to offer, on behalf

of the Board, my sincere thanks to them all.

Financial performance

With demand more subdued than

expected, resulting in revenues 2%

below 2023, the Board was encouraged

that our underlying profit expectations

remained unchanged throughout 2024.

Adjusted profit before tax was up 32% at

£20.0million (2023: £15.2million), driven

by proactive gross margin management

and reduced input costs.

Reported profit before tax was up 18%

at £13.8million (2023: £11.7million),

after non-underlying items of £6.2 million,

including the costs of our major business

system replacement project, which

remains on track for completion by mid-

2026. See Chief Financial Officer's Review

for full details of non-underlying items.

Adjusted basic earnings per share for the

year were 14.4 pence (2023: 11.0 pence)

and reported basic earnings per share

were 9.8 pence (2023: 8.6 pence).

The business continued to generate solid

cash flows, which supported completion

of a £15million share buyback programme

launched in January 2024. Pre-IFRS

16 net debt at 31 December 2024 was

£3.1million (31December 2023: net cash

£0.4million). We have a strong balance

sheet and good liquidity, which enabled us

to fund the acquisition of Alunet in March

2025 primarily from our existing debt facility.

Capital allocation

The Board is committed to driving

shareholder returns through a combination

of a progressive ordinary dividend and

supplementary distributions (currently

via share buybacks) where appropriate,

whilst always seeking to maintain a strong

financial position.

The Board proposes a final dividend of

3.9 pence per share, which results in total

dividends for the year of 6.1 pence per

share (£6.3million), up 10% compared

to 2023 (5.5 pence per share).

Derek Mapp

Chair

Eurocell plc Annual Report and Accounts 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 07

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 07

The recent acquisition of Alunet is a highly

complementary fit for Eurocell, reflecting

the growth of aluminium fabrication

for windows and doors in the market.

The acquisition protects our leadership

position in fenestration by expanding the

Group’s aluminium offering, with a wider

range of products and ownership of our

own aluminium system, and improves

our offering in composite doors. The

Alunet team will strengthen the Group’s

management and I am delighted to

welcome all 200 Alunet employees to

the Eurocell Group.

The Chief Executive’s Review includes

anupdate on progress with our key

strategic initiatives.

The £15 million share buyback programme

which commenced in January 2024 is now

complete and the Board has taken the

decision to launch a new share buyback

of up to £5 million.

Strategy and acquisition of Alunet

At the beginning of 2024 we launched

our new strategy, which identified a

pathway to building a £500million revenue

business, generating a 10% operating

margin, over a five-year period. The Board

is pleased with the good early momentum

with our strategic initiatives, which

supports our confidence in achieving

thisambitioustarget.

Board changes and governance

As previously announced, after nine years

of service, Frank Nelson stepped down

from the Board following the Annual

General Meeting (‘AGM’) in May 2024,

and KateAllum resigned from the Board

in July 2024 to pursue other opportunities.

Alison Littley assumed the role of Senior

Independent Non-executive Director and

Chair of the Remuneration Committee.

Iwould like to thank Frank and Kate for

theirpast contributions to the Group.

I can confirm that as a Board, we are

committed to the highest standards of

corporate governance and ensuring

effective communication with shareholders.

Derek Mapp

Chair

Eurocell plc Annual Report and Accounts 202408 Eurocell plc Annual Report and Accounts 202408

GDP Growth

Bank of England base rates (at 31 December)

2022

4.8%

0.4%

2023

0.9%

2024E

1.6%

2025F

2.0%

2026F

MARKET OVERVIEW

GOOD POTENTIAL

TO OUTPERFORM

MARKET FORECASTS

Whilst current market

conditions are challenging,

we have good potential to

outperform market forecasts

over the medium term.

10%

85%

Eurocell market by revenue %

CPA Construction Industry

Forecasts (2023–25)

The market growth estimates of the

Construction Products Association (‘CPA’),

provide informative baseline indicators of

the markets we operate in. The data and

graphs on the following pages summarise

the CPA forecasts published in January

2025 for our key markets, together with

a summary of the current drivers in these

markets and our response.

2022

3.5%

2023

5.25%

2024E

4.75%

2025F

4.0%

2026F

3.5%

The level of UK economic activity,

in particular the state of the repair,

maintenance and improvement (‘RMI’)

andnew build housing markets, are

important drivers of our performance.

UK economic forecasts

GDP and interest rate trends are expected to be slightly positive over the

next two years, although the growth is unlikely to be as early, or as fast,

asanticipated back in mid-2024.

RMI

New build

Commercial (new build & RMI)

1 Source: CPA Construction Industry Forecasts

(central scenario – published January 2025).

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 09

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 09

2022 2023 2024E 2025F 2026F

-14%

-9%

11%

1 Source: CPA Construction Industry Forecasts

(central scenario – published January 2025).

Private RMI

c.85%

Proportion of Eurocell revenue

• Consumer confidence

Macroeconomic factors, including

unemployment levels, influence consumers’

appetite for large discretionary spend

• Focus on the home

Although moderated from post-pandemic

highs, the focus on improving living

spaces, and developing home offices,

drives demand for conservatories, garden

rooms and simple extensions.

Our response

• Optimise our branch network through

a programme of estate transformation,

including new branches and

relocations, supported by enhanced

site-selectionmethodology

• Develop our customer offering for the

Branch Network, including increased sales

of windows and doors

CPA market growth projections and

their rationale

Private housing RMI output is expected

to grow by 3% in 2025 and 4% in 2026,

after a fall of 4% last year. These growth

rates remain unchanged from the Autumn

forecasts. The CPA assumes real wage

growth and interest rate reductions,

plus positive house price inflation and a

willingness to invest savings back into the

home, will fuel increased home improvement

projects in H2 2025 and on into 2026.

However, they acknowledge that consumer

confidence and willingness to spend

following the recent cost-of-living pressures

remains a challenge.

Market drivers

• Improve vs move

Property prices, housing supply and

moving costs affect whether homeowners

improve their homes rather than move.

The UK’s ageing housing stock should

also drive RMI demand

• Disposable income

Inflation, real wage growth and mortgage

interest rates affect disposable income for

repairs and maintenance

• Become the homeowner’s choice for

extended living spaces through products

such as garden rooms, extensions and

roof lanterns, supported by our Select

installer scheme

• Leverage our website, plus increased

investment in digital technology to

drive incremental e-commerce sales,

generate homeowner leads, attract new

trade accounts and drive traffic to our

branch network

• Protect our Profiles trade fabricator

business and maintain our value-added

service propositions that support

ourcustomers

• Customer-centric approach to new

product development

• A solid reputation within the industry

that creates loyal trade fabricator

partner advocates.

Private Housing RMI growth

-20%

-10%

10%

20%

30%

40%

New Build

c.10%

Proportion of Eurocell revenue

CPA market growth projections

and their rationale

Private housing (new build) output is now

forecast to grow by 6% in 2025 and 8% in

2026, after a fall of 9% last year. The 2025

forecast has been revised downwards

slightly since the Autumn, with a recovery in

new build now expected to be a little later

due to lower economic growth and higher

than previously forecast mortgage rates.

Similarly, the 2026 forecast was revised

slightly upwards.

Market drivers

• Housing supply

Structural deficit in new house building,

compared to government targets

• Government incentives

Although the deliverability and pace of the

government’s targets is yet to be proven,

the policy direction is positive

• Housebuilders’ plots

Housebuilders have a strong pipeline

of plot builds but uncertainty exists

regarding starts/completions/targets

• Homeowner demand

Rising rental costs and the enduring

desire to own your own property drive

home ownership, and this is expected

to be supported by the projected

reductions in the cost of borrowing

• Buyer incentives

‘Share ownership’ schemes, although

subject to eligibility, and ‘Right to Buy’

schemes in the public sector, make home

ownership more affordable and accessible.

Our response

• Protect our Profiles new build

fabricatorbusiness and maintain the

value-added service propositions that

support our customers

• Address the growing trend towards

aluminium fabrication in fenestration

through the acquisition of Alunet

• Leverage our strong proposition with

national housebuilders in the regional

new build market

• Provide a fit-for-purpose solution

toaddress the Future Homes

Standardregulations

• Continue proactive engagement with

our customer base regarding sustainable

product development

• Provide a sector-leading technical

support service

• Leverage our ESG credentials, including

our market-leading recycling operations.

2022 2023 2024E 2025F 2026F

-10%

10%

20%

30%

Private Housing growth

-4%

13%

CHIEF EXECUTIVE’S

REVIEW

Eurocell plc Annual Report and Accounts 2024

Against a tough market

backdrop, we delivered

strongprofit growth and

promising progress on all

ourstrategic initiatives.”

Trading conditions in our key markets

remained subdued, with challenging

macroeconomic conditions and

weak consumer confidence, further

compounded by uncertainty following the

Autumn Budget and high interest rates,

impacting activity levels in both the repair,

maintenance and improvement (‘RMI’)

andnew build housing markets.

However, we continued to focus on

proactively managing costs and cash

flow, and notwithstanding the market

environment, delivered profits for the year

in line with market expectations and well

ahead of 2023.

Further details of our financial and

operating performance, together with

an update on the early progress with

implementation of our five-year strategy,

which has been encouraging, plus the

acquisition of Alunet in March 2025,

areset out below.

Financial results

Sales for the year were £357.9million,

down 2% on 2023, with volumes 1% lower.

Adjusted profit before tax was

£20.0million, up 32% on 2023, driven

by lower raw material and electricity

costs, partially offset by the effect of

lower volumes, competitive pressure

on selling prices in the branches and

higher overheads, which include labour

cost inflation and investment to generate

momentum in our strategic initiatives.

Net cash generated from operations was

£44.2million, reflecting a continued focus

on cash management. This compares to

net cash generated from operations of

£52.8million in 2023, which included a

reduction in stocks of c.£13million.

Further information on our financial

performance is included in the Chief

Financial Officer’s Review.

Darren Waters

Chief Executive

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 11

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 11

Strategy

At the beginning of 2024 we launched our

ambitious new strategy, which reset our

objectives for the business. We identified

a pathway to building a £500million

revenue, £50million operating profit

business, generating a 10% operating

margin, over the five-year period to

December 2028. Our strategy is built

around four pillars: Customer Growth,

Business Effectiveness, People First

and ESG Leadership. The following

paragraphs summarise these pillars

and the initiatives which support them,

together with our early progress, which

has beenencouraging.

Customer Growth

Our aim is to become the trade customer’s

preferred choice in all markets and

segments where we operate. We believe

the biggest opportunity for growth

is expansion of the branch network,

including the sale of windows and doors

plus our extended living spaces range,

underpinned by an increased investment in

digital marketing, to raise awareness of our

products and home improvement solutions

and acquire new customers.

Branch Network

We estimate that the optimum Branch

Network size is at least 250 sites, which

was confirmed in 2024 through modelling

and analysis work with our location

planning partner. This work identified an

additional c.50 priority locations.

We opened 2 branches in Q4 2024 and

ended the year with 212 sites in operation.

We expect to open at least 7 branches in

2025, primarily in the South of England,

and plan to add c.30 new sites over the

next four years.

We will supplement the opening

programme with several branch

relocations, where the current site is

sub-optimal in terms of size or location,

and therefore a constraint to our growth

objectives. Relocations of our Staples

Corner and Greenford branches to a

new site in Wembley, plus our Dewsbury

branch, were completed in 2024.

New branches and relocations include

a refreshed branch exterior and are

supported with strong pre-opening

recruitment and marketing campaigns.

Operational performance

Production

Manufacturing performance was

impacted by skilled labour shortages and

unscheduled downtime caused by power

outages and equipment breakdowns.

In July we recruited a new Head of

Manufacturing, who has stabilised output

through process improvements and

preventative maintenance. We are also

engaging with providers of back-up power

solutions to mitigate against the impact

of unexpected power outages. Wehave

a programme of initiatives to drive further

operational improvements (see Business

Effectiveness on the following page)

and expect these benefits to start to

materialisein 2025.

Recycling

We are the leading UK-based recycler

of PVC windows, saving the equivalent

of c.3million window frames from landfill

each year. We maintained our use of

recycled materials in production at 32%,

level with 2023, driving lower carbon

emissions and cost savings compared

tothe use of virginmaterial.

Recycling feedstock purchase prices

peaked in 2023 but are now lower,

reflecting the action we have taken to

secure additional sources of supply.

Furthermore, we are finding more ways

to minimise and utilise the waste product

generated by our plants and expect to

progressively reduce the amount sent to

landfill over time.

Health and safety

The safety and well-being of our

employees, contractors and branch

customers is our number one priority.

Health and safety is the first agenda

item for key internal meetings. We have

enhanced the reporting of near misses

and unsafe acts and conditions as part

of a proactive approach to risk

management, with the aim of reducing

the likelihood of future workplace injuries.

This, when combined with the effective

and timely implementation of corrective

and preventive action, supports our

positive and improving safety culture.

Following good safety results in 2023,

we have delivered another improved

performance in 2024. Our Lost Time Injury

Frequency Rate (‘LTIFR’) was 4.1 in 2024,

compared to 5.7 in 2023.

Windows and Doors

With our initiative to sell more windows

and doors through the network, our target

is to fill at least 50% of the available spare

capacity in the estate over the five-year

period, which equates to incremental

annual sales of c.£35million.

Following encouraging early results,

we accelerated the site roll-out plan to

end 2024 with 91 branches live on the

programme. These branches delivered

incremental window and door sales of

£2.4million in 2024. Weplantocomplete

a progressive roll-out across the remaining

network in 2025.

In 2024, in addition to the site roll-out, we

focused on building up a dedicated supply

chain to support the needs of the whole

network. The project provides incremental

growth opportunities for our fabricator

partners, and we are working with them

tosecure additional capacity.

Extended living spaces

Extended living comprises garden rooms

and extensions. We are leveraging a

strong customer proposition and intelligent

data-driven marketing to drive growth in

these products. Based on encouraging

progress so far, we are targeting

incremental annual garden room and

extension sales of c.£30million over the

five-year period.

Since launching the garden room range

three years ago, we have built a strong

market presence. In 2024, we delivered

sales of £8.8million (2023: £4.4million),

supported by the introduction of four new

designs, and are well placed to capture

further growth in 2025.

We launched our extensions range at

the end of 2023, using modern methods

of construction that join together in an

innovative kit form, to create a cost-effective,

energy-efficient building solution for

homeowners looking to convert or extend

their properties, with installation times of

weeks rather than months. We sold over

30 extensions in 2024 with a value of

£1.0million, in line with our plans,

and enquiry levels are growing steadily.

Eurocell plc Annual Report and Accounts 202412 Eurocell plc Annual Report and Accounts 202412

CHIEF EXECUTIVE’S REVIEW CONTINUED

Profiles (fabricators)

In Profiles, following a period of strong

growth up to 2023, we believe we are now

the leading supplier of rigid PVC profile to

the UK market. Our strategy is to protect

our existing business and maintain our

value-added service propositions that

support customers. We will continue

to leverage our leading position with

housebuilders and commercial developers

to ensure we maintain specifications to

support a robust pipeline of work for our

fabricator customers. We are recognised

across the industry as the leading technical

systems house and will continue to exploit

this advantage too.

The windows and doors initiative also

provides growth opportunities in Profiles,

as it pulls through increased profile sales

via fabricator partners and increased

composite door sales through our

entrance doors business (Vista Panels).

In addition, as noted on page 13, the

recent acquisition of Alunet complements

our proposition to fabricators, by providing

a one-stop shop for PVC and aluminium

door and window systems. We have

already successfully recruited a number

ofexisting PVC fabricators who will switch

to Alunet in 2025, which underpins the

cross-sell opportunity.

Digital growth

Following the launch of our new website

in 2023, we have a futureproofed platform

to build a competitive advantage in the

online space, and an ambitious digital

strategy to drive more relevant trade

customer traffic to our website, as well as

build homeowner brand awareness and

become known for our extended living

spaces range.

In 2024, we invested in our organic web

traffic growth, increased our digital paid

media and improved our use of AI to

support customer targeting. We also

developed our web proposition with

extended ranges and initiatives, such as

one hour click-and-collect. As a result,

we have grown e-commerce sales,

driven more homeowner leads to buy

big ticket items such as garden rooms

and extensions, and attracted new trade

accounts to our branches, with 7,800

new spending accounts added in the year

(2023: 4,400).

The growth we delivered in windows,

doors and extended living spaces is

described on page 11. In addition to

this, e-commerce sales increased to

£4.7million in 2024 (2023: £3.0million)

and we are confident that we will achieve

further progress in 2025.

Business Effectiveness

Our objective is to make Eurocell a

lean and efficient business. We are

upgrading our business systems and

streamlining structures and processes

to increase efficiencies and improve

customer experience. Given that the

near-term market outlook is likely to

remain challenging, we will prioritise cost

reduction and operational improvements.

Systems replacement

As previously announced, we are in

the process of replacing our Enterprise

Resource Planning (‘ERP’) system,

including a new trade counter system

in the branch network.

We have selected Intact iQ as the new

trade counter system, to transform

the way we interact and transact with

customers in the branches, primarily

through process simplification (including

electronic point-of-sale technology).

We have selected IFS Cloud as our new

ERP system, to support all other functions

of the business. IFS comes with built-in

analytics to facilitate data-driven decisions

and supports the integration of functions

which currently operate on standalone

systems, including customer relationship

management.

The expected cost of the system

replacement is in the region of

£10million over the 2024-2026 period.

The implementation is on track and,

as previously reported, we estimate

thetransition will be completed around

mid-2026.

Continuous improvement,

efficiencies and cost reduction

We are also embedding a continuous

improvement philosophy, which has

highlighted opportunities for efficiencies

inthe branch network, manufacturing

andrecycling operations.

For example, in January 2025, we began

a restructuring of the Branch Network,

by removing a layer of regional operational

management and reducing the size of the

salesforce. In parallel, we are upskilling

branch managers, to drive better, faster

decision making and greater ownership

for branch performance. We expect to

complete the restructuring by the end

of Q1, generating an annualised saving

of c.£2million.

In our manufacturing and recycling

operations, we intend to pursue

opportunities to reduce scrap and

premium labour costs, plus improve

transport utilisation.

People First

With the People First pillar, our objective

is to make Eurocell a great place to work,

through a relentless focus on health and

safety, an enhanced employee value

proposition, improved levels of engagement

and effective talent management.

For health and safety, we are focused on

improving relevant leadership skills and

providing appropriate safety education.

We have made good progress, with

strong safety results delivered in 2024

asdescribed on page 11.

For our employee value proposition, we are

developing a wellbeing framework, new

recognition schemes and better induction

and onboarding programmes.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 13

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 13

Key priorities for employee engagement

include a new internal communications

framework, colleague forums and stepping

up community and charity work. In

2024 we completed our first externally

administered employee engagement

survey, with plans developed in response

tofindings.

Effective talent management includes talent

development, succession planning and

an increasing use of apprenticeships.

We intend to launch a revised apprenticeship

offer and a new leadership development

framework, affiliated to the Institute of

Leadership and Management.

ESG Leadership

Our ambition is to be seen as a leading

responsible company. Eurocell is already

a leader in PVC recycling, which prevents

millions of old windows being sent to

landfill. Looking ahead, we aim to excel

inall areas of ESG.

We are working with CEN Group, a

specialist ESG consultancy, to support

the development of our ESG strategy and

improve our ESG data and disclosures.

In 2024, we completed the work to

determine a path to reach Net Zero by

2045. We have now submitted our targets

to the Science Based Targets initiative

(‘SBTi’) for independent verification and

published our Transition Plan.

In 2025, we intend to progress

decarbonisation initiatives in line with

the Transition Plan. For Scope 1 and

2, the critical actions are increasing the

proportion of renewable electricity we use,

plus beginning the work to decarbonise

our commercial fleet and other company

vehicles. For Scope 3, our focus is to

identify paths to increase recycling and

explore options to increase the use

of commercially viable lower-carbon

alternatives to PVC resin over time.

Acquisition of Alunet

In March 2025, we announced the

acquisition of Alunet for consideration

of £29million on a debt/cash free basis.

Full financial details of the transaction,

including the potential for additional

performance-related payments, are set

out in the Chief Financial Officer’s Review.

The acquisition advances Eurocell’s

strategy, significantly strengthening the

Group’s position in residential aluminium

systems and composite doors, and adds

aluminium garage doors to our portfolio

of home improvement products.

For the year ended 31 December 2024,

Alunet delivered unaudited revenue of

£43million and EBITDA of £4.5million

(on a pre-IFRS 16 basis). Alunet has

grown rapidly since its establishment in

2016 and under Eurocell’s ownership,

we expect to leverage our leading market

positions in new build, trade fabrication

and distribution, to help the business

reach itsfull potential.

The Alunet team, led by Chief Executive

Steve Hudson, will strengthen the

Group’s management and Steve will

join our Executive Committee. Alunet

employs approximately 200 people and

we are delighted to welcome them all to

theGroup.

Summary and outlook

Our financial performance in 2024 was

resilient, in the context of trading conditions

that remained challenging. We delivered an

increase of 32% in adjusted profit before

tax, as we continued to proactively manage

gross margin and benefited from a reduction

in input cost pricing. Our cash generation

was solid and our financial position remains

strong, following completion of a £15m

share buyback programme.

We invested to generate momentum with

our strategy, and I am pleased with the

good early progress we have made across

a broad range of initiatives. In addition, the

recent acquisition of Alunet is a compelling

strategic fit for Eurocell.

Demand in our core RMI market remains

sluggish. We have seen some early signs of

an improving picture in new build housing,

albeit from a very low base. We will therefore

continue to focus on cost reduction

and operational improvements to drive

efficiencies, to mitigate against the impact of

a slower market recovery. We are confident

in delivering another year of good progress

in 2025, as we continue to execute on our

growth strategy. The medium and long-term

growth prospects for the UK construction

market remain attractive and we are well

positioned to drive sustainable growth in

shareholder value.

Darren Waters

Chief Executive

Eurocell plc Annual Report and Accounts 202414 Eurocell plc Annual Report and Accounts 202414

OUR STRATEGY

DELIVERING

VALUE

Strategy at a glance

At the beginning of 2024 we launched our ambitious five-year

strategy, which reset our objectives for the business.

Our purpose

Creating sustainable building

solutions for the trade of today, the homes

of tomorrow and the environment of the future

Strategic pillars

5-year ambition

£500m

Sales

£50m

Operating profit

10%

Operating margin

Customer growth

Be the trade customer’s

preferred choice, in all

markets and segments in

which we decide to compete

• Branch network

• Extended living

• Fabricators

• Digital growth.

Pages 16 to 21

Business effectiveness

Be a lean and efficient

business that enables agility

and enhances our profitability

• Operational efficiencies

• IT systems and

digitalisation.

Page 15

People first

Be a great place to

work, and a great brand

to invest in

• Health and safety

• Engagement

• Employee value proposition

• Growing talent.

Pages 25 to 29

ESG leadership

Earn a reputation

for being a truly

responsible company

• Environmental

• Path to Net Zero

• Circular economy

• Waste minimisation.

Pages 22 to 24

Our core values

Agile Gritty Proud Decent

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 15

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 15

Our ambition

Our purpose and core values underpin

our strategy, which is focused on the

delivery of:

• Significant organic growth through the

transformation of the branch network

and other commercial initiatives

• Operational improvements and footprint

consolidation

• Simplification and digitalisation

of business processes

• The creation of a strong, cohesive

culture, where people are our priority.

We identified a pathway to building a

£500million revenue, £50million operating

profit business, generating a 10% operating

margin, over the five-year period to

December 2028.

Overall, we are making good progress with

the early stages of the strategy and are

confident that, whilst these are ambitious

targets, they are achievable.

The strategy is built around four pillars:

Customer Growth, Business Effectiveness,

People First and ESG Leadership.

Pages 15 to 21 summarise the Customer

Growth and Business Effectiveness pillars

and the initiatives which support them,

together with our progress in 2024 and an

outline of our plans for 2025.

Full details of our progress with all aspects

of the People First and ESG Leadership

pillars are set out in the Sustainability

Report on pages 22 to 39.

Strategic Pillar:

Business effectiveness

Initiative: Upgrade our business systems and streamline

structuresand processes to increase efficiencies and improve

customer experience

Strategy in action: 2024 progress

Strategy in action: Enterprise Resource Planning (‘ERP’)

systemreplacement

• Selected Intact iQ as our new trade counter system, to transform the way

we interact and transact with customers through process simplification

(including electronic point-of-sale technology)

• Selected IFS Cloud as our new ERP system for all other areas of the business,

which comes with built-in analytics to support data-driven decisions and

supports the integration of other functions which operate on standalone

systems today, including customer relationship management

• Project progressing to plan, with design and scope of work completed,

plus data preparation, integrations and solution build commenced.

Continuous improvement, efficiencies and cost reduction

• Identified opportunities for 2025 to:

– Branch Network: restructure staff organisation to generate annualised

savings of c.£2m

– Operations: deliver cost reduction and efficiency improvements

by reducing scrap, plus improving labour utilisation.

Strategy in action: 2025 focus

Strategy in action: Enterprise Resource Planning (‘ERP’)

systemreplacement

• iQ and IFS

– Complete solution design, configuration and integrations

– User acceptance testing, training and commence deployment.

Continuous improvement, efficiencies and cost reduction

• Branch network: organisation restructuring

• Operations: scrap reduction and premium labour cost reduction.

2024 KPIs

Total cost of system replacement is c.£10million 2024–26:

Costs incurred in 2024: £2.2million

Strategic Pillar:

Customer growth

Eurocell plc Annual Report and Accounts 202416 Eurocell plc Annual Report and Accounts 202416

OUR STRATEGY CONTINUED

Initiative: Branch network

Estimate optimal size of the

network is at least 250 sites

(31December 2024: 212 sites),

with target to add at least 30 new

branches over the next four years

Initiative: Windows and doors

Sell more windows and doors through

the network, with target to fill 50%

ofavailable spare capacity over the

five-year period, driving incremental

sales of c.£35m

Initiative: Extended living spaces

Target incremental garden room

sales of £20million and extensions

of£10million vs 2023 in the

five-year period

Strategy in action: 2024 progress

• Confirmed optimum estate size

through modelling work with location

planning partner

• Identified an additional c.50

prioritised locations

• Identified opportunities to optimise

existing estate through relocations,

where current sites do not provide

the required growth opportunity

• Opened two new branches in Q4

(Bishops Stortford and Watford)

• Completed three relocations

(Greenford and Staples corner

to Wembley, plus Dewsbury)

• Refreshed branch exterior and

signage design for new sites

and relocations

• Continued branch facilities and

welfare improvement programme.

Strategy in action: 2024 progress

• Successfully completed initial six branch

trial (started in Q4 2023)

• Accelerated a progressive roll-out

across the network, ending the year

with 91 branches live on the programme

• Established a dedicated supply chain

for PVC and aluminium window frames

and glass

• Implemented a comprehensive staff

training programme and established

a central order processing team

• Delivered incremental window and door

sales of £2.4million.

Strategy in action: 2024 progress

• Successfully completed extensions

product launch (started in Q4 2023)

• Launch of four new garden

roomdesigns

• Sold c.550 garden roomsatatotal

salesvalue of £8.8million

(2023:c.300units, £4.4million)

• Sold over 30 extensions in 2024 with

a total sales value of £1.0million.

2024 KPIs

Estate size:

31 December 2024: 212 sites

(31 December 2023: 214)

New branches

2024: 2 new sites

(2023: no new sites)

2024 KPIs

Branches live on the programme:

31 December 2024: 91

(31 December 2023: 6)

Incremental annual window and door

sales vs 2023:

2024: £2.4million

2024 KPIs

Garden room sales:

2024: £8.8million

(2023: £4.4million)

Extension sales:

2024: £1.0million

(2023: £0.1million)

Strategy in action: 2025 focus

• Open seven new branches

• Ongoing programme of relocations

and network welfare improvements.

Strategy in action: 2025 focus

• Progressive roll-out across the remaining

branches, with all sites live byyear-end

• Supply chain expansion in line with

programme targets.

Strategy in action: 2025 focus

• Drive growth through marketing

investment, enhanced website content

and product development.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 17

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 17

Initiative: Profiles (fabricators)

Protect our existing PVC business

and expand our aluminium offering

Initiative: Digital growth

Build awareness of our products

and home improvement solutions,

driving new customers and

incremental sales through

thewebsite

Strategy in action: 2024 progress

• Continued to protect our existing PVC

fabricator business, via:

– Maintaining our value-added

serviceproposition

– Leveraging our position as the

leading technical systems house

– Exploiting our position

with housebuilders to

maintainspecifications.

• Identified an opportunity to enhance

our position in fenestration through the

acquisition of Alunet, which delivers:

– Aluminium system ownership and

a full range of aluminium products

– Complementary solid core entrance

door business

– Addition of aluminium garage doors

to our range.

Strategy in action: 2024 progress

• Improved website experience via:

– Including additional

productcategories

– Better SEO, site structure

andnavigation.

• Focused on incremental revenue

drivers such as PPC, email and

product recommendations

• Introduced new e-commerce

initiatives,such as dropship and

one-hourclick-and-collect.

2024 KPIs

Rigid PVC profile sales:

2024: £115.0million

(2023: £117.4million)

2024 KPIs

E-commerce sales:

2024: £4.7million

(2023: £3.0million)

Strategy in action: 2025 focus

• Integrate Alunet and begin to capture

synergies in areas such as cross-selling,

supply chain and cost optimisation.

Strategy in action: 2025 focus

• Drive web adoption among existing

account holders and attract a wider

trade audience

• Improve the customer experience

and conversions

• Introduce an online windows and

doors proposition.

The growth opportunity for

Window and

door opportunity

Eurocell manufacture

window profiles and

composite doors…

which are made

into windows by our

fabricator partners and

doors by Vista…

or sold through a

Eurocell branch…

to a window installer

who install the finished

windows and doors

into a home…

providing the

homeowner with quality

windows and doors.

and either sold

directly…

Opportunity to increase window and

door sales to installers through our

network of UK branches…

by utilising space capacity in our

branches, which currently sell c.1,100

frames per week, but have the space

to sell up to c.6,300 frames per week…

through a targeted approach, focusing

primarily on window installers (who buy

competitor windows)…

which through a phased roll-out, has

potential to deliver c.£35m incremental

sales (using 50% of spare capacity).

Improves returns

for the whole

branch network

Shortens time to

break-even and payback

for new branches

Utilises spare production

capacity for window

profile and doors

Eurocell plc Annual Report and Accounts 202418 Eurocell plc Annual Report and Accounts 202418

OUR STRATEGY CONTINUED

Growth opportunity and route to market for increased

sales of Eurocell windows and doors.

Route to market for windows

STRATEGY

IN ACTION

Target customers

Window installers General builders

DIY’ers

20%

75%

5,200 Spare capacity

(frames per week)

1,10 0

2024

25%

50%2023

2022

Capacity

utilisation

Sales of windows

and doors (£m)

higher number of

households within

catchment area…

with higher proportion of

home ownership…

skewed more

towards larger

residential properties…

in areas where age of

housing stock is

at least 25 years old…

and where

affluence is higher.

proximity to other

Eurocellbranches…

in branches with

strong teams, with

low labour turnover…

with a slight skew

towards overperformance

in coastal locations…

and in branches

with good access

and parking.

customer drivetimes

at peak hours

(rush hour)…

in branches where

competitors create a ‘hub

effect’ that attracts demand…

despite competitors

pulling on our

available demand…

which is primarily

driven by key competitors

(Gap/Epwin).

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 19

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 19

Optimal branch

estate size

Confirmed an optimal branch network estate size is at

least 250 branches, with priority locations identified.

Key drivers and critical success factors for branches

Customer demand for Eurocell

product is driven by…

Attractiveness of a Eurocell branch

is affected by…

Catchment area for a Eurocell

branch is impacted by…

Conclusion

CACI modelling confirmed an optimal estate size of at least 250 branches,

with c.50 prioritised new locations identified.

Plan

• 212 branches at 31 December 2024 – plan to add c.30 new sites over the next four years

• Two new branches opened in Q4 2024 and seven planned for 2025

• Three relocations completed in 2024 and five planned for 2025.

Demand

map

CACI help us determine

’s demand map

CACI model combines Eurocell

data with UK population and

housing data sources.

Customer demand derived

using drive-times.

STRATEGY

IN ACTION

Eurocell plc Annual Report and Accounts 202420 Eurocell plc Annual Report and Accounts 202420

Refreshed branch

exterior and signage

OUR STRATEGY CONTINUED

New branches and relocations include a refreshed

branch exterior and signage.

Brand loud and proud – larger more prominent signage, and with core categories clear at mid-height

New Bishops Stortford branch New Watford branch

Wembley relocation Preston relocation

STRATEGY

IN ACTION

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 21

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 21

Digital

strategy

Customer growth is underpinned by an increased investment in

digital marketing, to raise awareness of our products and home

improvement solutions and thereby acquire new customers.

Our ambition

Enhance our market-leading digital proposition to build awareness of our products

and home improvement solutions, driving new customers and incremental sales

Improved website

experience

Including additional

product categories

improved SEO, site

structure and navigation

Focus on incremental

revenue drivers:

• PPC

• Email

• Product

recommendations

• New trade accounts.

Improved customer

experience with new

e-commerce initiatives:

• Dropship

• One-hour

click-and-collect

• Bulk buys

• Web exclusives.

Resulting in stronger

web trading

Organic traffic is now

▲ 39% v 2023

B2C e-commerce sales

▲ 57% v 2023

Digital activity builds awareness of our brand,

attracts new customers and drives traffic to our branches

Search engine

optimisation (‘SEO’)

improving our rankings

30,000 keywords now

ranked with 1,500 rank in

top three search results

Pay per click (‘PPC’)

Targeting corerange,

garden rooms

andextensions

Targeted email

campaigns

88% of e-commerce

customers are new

New website

Future-proofed

platform to build our

competitive advantage

in the online space

Order fulfilment

Primarily delivered via

our branch network

Homeowner

Tradesperson

campaigns

engines

Social

media

STRATEGY

IN ACTION

Eurocell plc Annual Report and Accounts 202422 Eurocell plc Annual Report and Accounts 202422

SUSTAINABILITY

REPORT

Why sustainability matters

Eurocell is committed to operating a

sustainable business and building a

reputation for being a truly responsible

company. We aim to lead the fenestration

sector in sustainability and are focused on

reducing our carbon footprint, valuing and

supporting the wellbeing of our people,

and improving the environment in which

we operate.

Our Group purpose is to create sustainable

building solutions for the trade of today, the

homes of tomorrow and the environment

of the future. Circular economy principles

lie at the heart of our strategy and our

operation, as we recycle old PVC window

profiles into new products. In addition,

we aim to reduce our environmental

impact via energy saving initiatives and

waste management schemes whilst,

generating savings for our customers

through products that minimise heat loss

and lower energy bills. We endeavour to

provide an excellent, safe workplace for

our colleagues and to ensure they feel

supported and valued. We will continue to

play an active role in our communities and

being a good neighbour.

In working to embed our sustainability

strategy, we recognise that our customers,

employees, other stakeholders and the

communities in which we work are placing

increasing importance on environmental,

social and governance (‘ESG’) matters.

In 2024, our focus has been on setting

science-based emission reduction targets

and developing our climate Transition Plan.

In 2025, we will build on these foundations

by formalising decarbonisation actions

and progress metrics, disseminating them

across the business and enhancing the

precision of our estimates, to show a clear

pathway amidst the inherent uncertainties

of the Transition Plan.

ESG

LEADERSHIP

• Integrity is the cornerstone

of our business

• Fully transparent in the way

that we operate and report

• Receptive and responsive

to challenge and scrutiny

by keystakeholders

• Constantly evaluating and

mitigating risks to protect

thebusiness

• Always have one eye to the

future, in order to comply with

new legislation and deploy

best practice.

• Employee safety and welfare is

always front of mind

• We will live and breathe our values

without compromise

• A diverse business, where people

can be their true authentic selves

• Excel at developing people, by

nurturing talent and always seeking

to promote from within

• Fair in the way that we reward and

manage our people.

• Maximise recycled content

in manufactured products

• Ethically source raw materials

and products

• Progressively reduce carbon

footprint on a path to Net Zero

by 2045

• Be a responsible neighbour,

wherever we operate

• Minimise waste and usage

of plastic packaging.

With the highest standards of governance

A great place to work

Driving sustainability in the fenestration sector

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 23

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 23

Achievements since our last Annual

Reportinclude:

• Submitted targets to the Science

Based Targets initiative (‘SBTi’).

Wesubmitted both near-term and

long-term targets to SBTi covering

Scopes 1, 2 and 3 emissions

• Published our Net Zero Transition

Plan aligned to the Transition Plan

Taskforce (‘TPT’) standards. Weset

out the underpinning initiatives that

will drive carbon reduction across our

business and plans to achieve these

• Maintained the percentage of

recycled PVC in our products. In 2024

we achieved 32%, level with 2023. We

have updated our medium-term target to

36%, to reflect higher forecast revenue

growth in line with our five-year strategic

plan, plus the expected availability of

feedstock for our recycling plants

• Continued to invest in carbon

reduction initiatives to minimise

our environmental impact. Solar

panels are now operational at our main

extrusion site, plus installation of panels

at our distribution centre begins shortly

• Enhanced our reporting against

the recommendations of the Task

Force on Climate-related Financial

Disclosures (‘TCFD’). This includes

refining analysis and supporting it with

financial quantification where possible

• Submitted our first Climate Change

questionnaire to the CDP. We are

pleased to share we were awarded a

Bgrade for Climate

• Received an ‘AA’ rating from the

MSCI. In 2024 Eurocell received a rating

of AA (on a scale of AAA–CCC) in the

MSCI ESG Ratings assessment

• Substantially enhanced employee

engagement. We launched our internal

communications framework (including

the Eurocell and You monthly newsletter

and CEO listening groups) and

completed a much more comprehensive

employee engagement survey with an

external provider

• Pushed forward on Equity, Diversity,

Inclusion and Belonging. We joined

the Construction Inclusion Coalition and

committed to the Built on Better Pledge.

Looking forward, our priorities are to:

• Obtain validation of our submitted

science-based targets from the SBTi.

In the meantime, we will commence

implementation of the planned actions

that support achieving our targets

• Focus on sustainability as part of our

new product development programmes,

looking to increase the development

of low-carbon products to meet

consumerdemands

• Review and enhance our wellbeing

framework to ensure that we better

support the wellbeing of employees

in line with their expectations

• Continue to engage with Maggie’s, our

charity partner, that provides emotional

support and care for cancer patients

and their families.

Materiality assessment

There are no changes to our business

that would require an updated materiality

assessment. The five most important

issues identified by our assessment are:

• Health and safety: ensuring workforce

wellness and safety

• Labour and human rights: ensuring fair

working practices for our employees

including human rights

• Climate change and emissions:

minimising our carbon emissions and

our contribution to climate change

• Waste management: waste generated

by our operations needs to be dealt with

responsibly, including hazardous waste

• Product quality: selling products that are

safe to use and of high quality.

We used these material topics to refine our

ESG strategy in 2024 and monitor progress

with appropriate KPIs andtargets.

Eurocell plc Annual Report and Accounts 202424 Eurocell plc Annual Report and Accounts 202424

SUSTAINABILITY REPORT CONTINUED

Sustainable business goals

KPIs and targets

Since our base year of FY22, we have achieved reductions across all three scopes. Scope 2 market-based has seen the most

significant reduction, due to sourcing renewable electricity across 95% of our electricity consumption (up from 72% in FY22).

TheScope 1 reduction of 6.8% from FY22 was through reduction in our natural gas consumption. Reduced spending was the main

driver of our Scope 3 reduction; however, we have also taken actions aligned with our transition plan to acquire supplier emissions

data and purchase lower embodied carbon products which is reflected in our FY24 Scope 3 emissions.

KPI 2024 2023 Target Link to UN SDGs

Environmental – Circular economy and waste management

Waste to landfill % landfill 2.5% 9% No more than 5% waste to

landfill by2025 and 1% by

2030

Waste recycled % recycled 69% 76% Increase of 2% per annum in

waste recycled (to 88% by

2025), then increase of 1%

per annum thereafter (to 93%

by 2030) vs 2020 baseline

Recycled material

used in production

% used 32% 32% 36% by 2030

Recycled material

yield

% generated 62% 63% 72% by 2030

Environmental – Emissions, energy management and pollution

Scope 1, 2 and

3 emissions

(Market-based)

Absolute Scope 1,

2 and 3 emissions

(Market-based)

183,299 tCO

e 188,199 tCO

e Net Zero by 2045

Scope 1 and 2 Absolute Scope

1 and 2 emissions

(Market-based)

9,995 tCO

e 10,862 tCO

e 70.03% reduction by 2034

Scope 3 Absolute Scope 3

emissions

(Market-based)

173,305 tCO

e 177,300 tCO

e 37.5% reduction by 2034

Renewable electricity % renewable

electricity used

95% total

electricity

94% total

electricity

More than 90% by 2025

Social

Health and Safety Lost-time injury rate 4.1 per

1m hours

5.7 per

1m hours

3.1 per 1m hours by 2026

Employee

engagement

and recruitment

Labour turnover 25% 27% Year-on-year reduction

Employee

satisfaction

Annual survey

response rate and

Winning Formula score

70% and 59% 73% and n/a Year-on-year increase

Diversity Female employees 16.9% 16.3% Year-on-year increase

Remuneration National Living Wage

(‘NLW’)

All employees

at or above

NLW

All employees

at or above

NLW

All employees above NLW

by 2023

Education Apprenticeships/

Kickstarters

63 61 20% increase on 2020 base

of32by2025

Note: KPI performance data for 2023 and 2024 included in the table above is based on management estimates.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 25

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 25

HEALTH AND

SAFETY

Responsibilities

Health and safety remains the most

material issue identified in our materiality

assessment. Our Group-wide Safety,

Health and Environment Policy, available

on our website, outlines our commitment

to ensuring a safe and healthy working

environment for employees, visitors

andcontractors.

SHE strategy

We update our Safety First strategy each

year based on our health and safety

performance, employee and management

feedback, plus emerging trends and

best practice. We continually engage

with employees regarding health and

safety issues through volunteer safety

representatives and monthly safety

meetings to ensure their participation

inhealth and safety management.

This year our Safety First strategy focused

on 12 core initiatives, which have served

to develop the knowledge and awareness

of health and safety issues throughout our

workforce, leading to the better behaviours

that have underpinned an improvement in

our overall performance. We are confident

that we are developing a culture of

continual improvement in safety standards.

Safety

First

IOSH Training

Full-day IOSH Working Safely training

provided to operations colleagues each month

and IOSH Managing Safely training provided

to line management and Safety Reps.

Recognition Schemes

Individual and collective recognition

forgood practices, behaviour and

milestoneachievements.

Visual SHE

Installation of SHE Focus Areas and

electronic ‘days since last accident’

display screens.

Induction Process

Reviewed and updated across the

Branch Network.

Focus Area: Manual Handling Risk

Dedicated focus on reducing manual

handling risks.

Dynamic Risk Assessment

‘Take 5’ training has been provided and

booklets issued, encouraging employees to

stop and re-assess risks as needed.

Cardinal Rules

Reviewing, amending, and ensuring

compliance with our nine Cardinal Rules.

Leading SHE KPIs

Performance against KPIs has been

reported at monthly ExCom meetings

since March.

ISO Standards

Working towards certification for all sites.

Safe Start Standdown

Half-day standdown delivered to all staff

around the Christmas shutdown.

Hazard Reporting

Electronic hazard reporting screens

implemented at all Operations sites.

Directing and leading safely training

Half-day directing/leading safely courses

provided to ExCom and direct reports.

Eurocell plc Annual Report and Accounts 202426 Eurocell plc Annual Report and Accounts 202426

Some of our key initiatives include:

• Reducing manual handling risk, which

is an integral part of our operations

• Continued focus on visual SHE to

keep health and safety at the forefront

of employees’ minds

• Implementing a new hazard

reporting process

• Focused on Dynamic risk assessments.

We plan to build on our achievements

by focusing on the following in 2025:

• Complete a ‘back to basics gap

analysis’ at each of our sites, to assess

our performance against SHE best

practice, and rectify any significant

findings to mitigate risk

• Continuing with our Cardinal Rules

programme, with a focus on Material

Handling Equipment (‘MHE’), including

an update to our transport safety risk

assessment, enhancing the safety

features on our MHE, and by improving

segregation and visual safety

• In the Branch Network, we plan to

focus on the safety of contractors,

by implementing a contractor safety

checklist for branch managers and

providing them with appropriate training.

ISO certification and compliance

In 2024, Eurocell maintained the ISO

45001 certification at four of our eight

manufacturing sites (2023: four sites).

Wecontinue to work towards our target

to implement safety management systems

that satisfy the requirements of ISO 45001

at all of our operational facilities by the end

of 2025.

We are pleased that the two Health and

Safety Executive (‘HSE’) Improvement

Notices that we reported on last year,

relating to dust and machine guarding,

have been revoked, as they have been

addressed to the satisfaction of the HSE.

However, we received a Notice of

Contravention in 2024 following a

significant incident resulting in 4 months

absence for the injured party. We have

formally responded to the HSE’s notice,

outlining our investigation into the incident

and the corrective action plan developed,

which is being rigorously tracked.

Safety performance

We have delivered another significant

improvement in our overall safety

performance in 2024, reducing the

numberof lost time injuries by 30%,

thelost time injury frequency rate by

28%,and the RIDDOR rate by 45%.

We have achieved this improvement

despite three major incidents that we

aredisappointed to report.

We have undertaken a thorough

investigation in each case and

implemented corrective actions to prevent

similar incidents occurring in the future.

The number of near misses reported in

2024 increased by 18% this year, although

we attribute this to an enhanced focus on

hazard identification and awareness with

the implementation of our new hazard

reporting process.

Safety targets

As an overall ambition, we are targeting

the elimination of RIDDOR (Reporting

of Injuries, Diseases and Dangerous

Occurrences Regulations 2013) injuries

among our employees by the end of 2027.

To assist with tracking our progress we

have set interim targets, and for 2025 we

are aiming to achieve a 25% reduction in

our lost time injury frequency rate (‘LTIFR’)

and 33% reduction in our RIDDOR rate

compared to 2024.

2024 2023 2022 2021 2020

Lost time injuries (employees)

1, 2

19 27 48 36 24

Lost time injury frequency rate (‘LTIFR’)

4.1 5.7 10.0 7.6 7.4

Total recordable injuries (contractors) – 1 – – 1

RIDDOR 6 11 23 28 19

Near misses 172 146 102 29 n/a

Number of employee fatalities – – – – –

Number of contractor fatalities – – – – –

Number of cases of silicosis – – – – –

Number of staff trained on health and safety standards 241 322 – – –

Number of health and safety training hours 1,687 3,456 – – –

Proportion of operational sites certified to ISO 45001 50% 50% – – –

1 We define lost time injuries as a full shift lost following the day of the incident.

2 We record lost time injuries for all permanent and temporary employees.

3 Injuries per onemillion hours worked.

SUSTAINABILITY REPORT CONTINUEDSUSTAINABILITY REPORT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 27

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 27

Our strategy and business model are

underpinned by the commitment and

efforts of all our employees and our

approach to colleague interaction is

explained and monitored through our

People First strategic pillar.

Engagement

We recognise the impact we have on our

colleagues, communities and beyond, and

are committed to ensuring that we engage

appropriately with all key stakeholders.

Employee engagement

We engage with employees through a

variety of methods to ensure all have the

opportunity to be heard.

Internal Communications

Framework

We appointed an Internal Communications

Manager in 2024 who has already made

great strides in improving employee

communications based on a broad range

of colleague feedback. Several initiatives

have been implemented based on the

findings, forming the basis of our new

Internal Communications Framework.

PEOPLE

FIRST

Board engagement

We continue to run colleague focus groups,

led by our designated Non-executive

Director Alison Littley but carried out by all

the Non-executive Directors.

People First survey

In 2024, we engaged an external partner to

introduce a new survey capturing a broader

understanding of employee sentiment

across a greater variety of topics including

engagement, process, culture and strategy.

The three largest areas of focus emerging

from the survey are wellbeing, reward and

recognition, and job satisfaction. We are

committed to making improvements in

these areas, some of which we have been

able to action already, and some of which

will be incorporated into our future plans.

The change in survey makes any

comparisons with previous results less

meaningful. However, the 2024 survey

has established a baseline and we are

sure that this work will result in greater

personal and professional development

opportunities for our employees.

KPI 2024

Response rate 70%

Overall Winning Formula Score 59%

Winning Culture Score 59%

Winning Strategy Score 58%

Overall engagement score 61%

Community partnerships

In 2024, our charitable efforts continued

to focus on Maggie’s, which provides

emotional support and care for cancer

patients and their families, with 24 centres

across the UK.

Over 2023 and 2024 we raised a total

of £46,000 for Maggie’s, with a variety

of activities. We are incredibly proud

of the collective effort and generosity

demonstrated by our colleagues.

We remain committed to supporting

Maggie’s in 2025.

‘Our ambition is to have talented, engaged and motivated colleagues

whoworkpassionatelytoachieve clear business and personal goals’.

Eurocell will be a great place to work, where our culture makes colleagues feel...

OUR

AMBITION

OUR

STRATEGY

KEY

PRIORITIES

SUCCESS

MEASURES

“I feel part of the Eurocell team

and I’m passionate about

myrolewithin thisteam”

HEALTH AND SAFETY

Develop health and safety

leadership skills

Develop health and

safetyeducation

EMPLOYEE VALUE

PROPOSITION

Wellbeing framework

Recognition scheme

Induction and onboarding

programme

ENGAGEMENT

Internal Communications

Framework

Colleague forum

Community and

charityengagement

GROWING TALENT

Talent management and

succession planning

Talent development

Maximising use of

apprenticeships

“I know how to contribute to

the success of my business”

“I know what’s going on... Ifeel

connected to the wider business –

I'm valued as ateammember”

“I know how I can progress

within Eurocell, I’m clear

about my development”

IFR/LTIR/Severity Rate/

RIDDOR Rate

Attrition and Retention % % of Internal Promotions

Apprenticeships

Participation/Use of Levy

Culture Survey Feedback

Eurocell plc Annual Report and Accounts 202428 Eurocell plc Annual Report and Accounts 202428

Employee Value Proposition

Our Employee Value Proposition captures

the various topics which together aim to

ensure our employees feel valued and

supported as members of the Eurocell team.

Fair working practices

We are committed to providing a fair

working environment for all our colleagues,

including a fair salary, terms and conditions

of employment, and statutory benefits.

Employee turnover

We are pleased to report that our labour

turnover decreased from 27% in 2023 to

25% in 2024, although this remains above

our 2020 baseline of 21%. We expect to

see continued progress in 2025.

Our full-time colleague voluntary turnover

rate was 20% in 2024.

Reward and recognition

Our policy is to comply, at the very least,

with minimum wage legislation for all

colleagues. Each year we ensure that

all employees are paid at or above the

National Living Wage (‘NLW’) and can

confirm that we remained in line with this

ambition again in 2024.

During 2024 we focused on simplifying

and standardising our reward packages.

Our reward strategy ensures that all

employees are eligible for a range of

benefits and incentives that include a

defined-contribution pension scheme

(introducing salary sacrifice in April

2025), life insurance, Save As You Earn

(‘Sharesave’) schemes, a health care

cash plan and access to savings and

offers through our third-party platform.

Inaddition to the formal packages,

we have a variety of events and vehicles

to engender a culture of feeling valued.

In 2024, we introduced the Proud Awards.

Employees are encouraged to nominate

fellow colleagues that have showcased

any of our values that make their

colleagues or managers proud.

Wellbeing framework

We are committed to supporting all

colleagues in their wellbeing, inclusive

of mental, physical and financial issues.

We provide tools to support colleague

wellbeing, including an Employee

Assistance Programme, access to

health and wellbeing support, and our

occupational health programme with

targeted health surveillance and a health

care cash plan. Our People First survey

results identified wellbeing as one of our

largest focus areas, so we plan to review

and enhance our wellbeing framework in

2025, to ensure we appropriately support

the wellbeing of all colleagues in line with

their expectations.

Equity, diversity, inclusion

and belonging

The overriding policy in any new

appointments we make continues to

be one of selecting candidates with an

appropriate mix of skills, capabilities

and market knowledge, to ensure the

continued success of the business.

However, we recognise fully the benefits

of encouraging diversity and inclusivity

across the business and believe that

progress in these areas will contribute

strongly to our continued success.

We have recently reviewed and updated

our Equity, Diversity and Inclusion Policy

and our Anti-Bullying, Harassment

and Victimisation Policy, as we aim to

continually improve our processes.

We are committed to providing a working

environment that embraces opportunities

for everyone, as set out in our Policy,

available online.

We are also committed to fostering an

environment that respects the equity and

diversity of all colleagues and ensures

their feeling of inclusion and belonging.

We have joined the Construction

Inclusion Coalition, created to improve

equity, diversity and inclusion across the

construction sector. We have committed

to the Coalition’s Built on Better Pledge

and are fully engaged in the efforts to

enhance diversity and inclusion in the

construction sector.

Whilst we operate in an industry in which,

historically, women have been under-

represented, we are very committed to

increasing the participation of women

throughout the Group. Our historic target

has been to deliver year-on-year increases

in the proportion of female employees in

the Group. In 2024, female employees

increased to 17% (2023: 16%).

In addition, we continue to promote flexible

solutions tailored to, and supportive of,

individual needs. Our internal processes

support all colleagues who may require

help and support, including employees

who are disabled or become disabled

during their employment, to fulfil their

day-to-day work activities through our

occupational health provision. We provide

tailored support for specific groups and

individuals throughout our business,

including the provision of free English and

maths tuition for non-English speakers.

SUSTAINABILITY REPORT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 29

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 29

This year we developed and published

our Board Diversity Policy, available on

our website.

The relatively small size of the Board

and the pre-existing Directors’ service

contracts have inevitably limited the

pace of change. We currently meet two

of the three FCA targets on diversity,

with one Director from an ethnic minority

background and one senior Board position

held by a female. Our progress towards

meeting the target of 40% of the Board

being women (38% as at the 2024 AGM)

was adversely impacted by Kate Allum’s

departure in July.

Following changes in 2024, female

membership of the Executive Committee

has now increased to 60%.

2024 diversity statistics

No.

% of total

employees

Employees with

disabilities

52 3%

Full-time employees 1,856 96%

Part-time employees 71 4%

Permanent

employees

1,873 97%

Contract/temporary

employees

54 3%

Total employees 1,927 –

Growing Talent

Our main focus areas under Growing

Talent in 2024 were; leadership

development, talent management,

succession planning and apprenticeships.

We completed a review of our

induction process and identified

improvements which are now in place.

We also introduced two new leadership

development programmes for branch

managers and operations leaders.

We continue to offer apprenticeship

positions through the apprenticeship

levy, and as of year-end employed

27apprentices.

We are working to define and streamline the

programme across the Group and launch

a new apprenticeship programmein 2025.

2024 training statistics

No.

% of total

employees

Employees who

receive training

2,067 100%

Number of

training hours

33,992 –

Average training

hours per employee

17. 6 –

Gender diversity statistics

2024 gender analysis

Male

No. %

Female

No. %

Total

No.

Directors 5 71% 2 29% 7

Executive Committee 2 40% 3 60% 5

Senior management 23 72% 9 28% 32

Other employees 1,685 83% 338 17% 2,023

Total 1,715 83% 352 17% 2,067

2023 gender analysis

Male

No. %

Female

No. %

Total

No.

Directors 6 75% 2 25% 8

Executive Committee 3 75% 1 25% 4

Other employees 1,753 84% 342 16% 2,095

Total 1,758 84% 343 16% 2,101

Eurocell plc Annual Report and Accounts 202430 Eurocell plc Annual Report and Accounts 202430

SUSTAINABILITY REPORT CONTINUED

ENVIRONMENTAL

LEADERSHIP

Managing environmental

performance

We recognise the role we play in

promoting environmental protection

and are committed to conducting our

business in a safe and responsible

manner,includingprotecting and

minimising the impact of our operations

on the environment. We are focused

on reducing our environmental impact

and aim to continuously improve our

performance. In 2024, we developed

a dedicated Environmental Policy

which is available at:investors.eurocell.

co.uk. Applying to allcolleagues across

part of the Group, the Policy outlines

our commitments towards reducing

emissions,energy consumption,

biodiversity and environmental issues,

waste and resource use, water use,

andthe environmental impacts of

ourproducts.

The environmental management

systems implemented at our extrusion

plants, secondary operations (foiling)

facility and door manufacturing plant

are all accredited to ISO 14001:2015.

Wheresitesarenotcertified to ISO 14001,

we continue to maintain an environmental

management system and have daily

inspections to ensure permit compliance.

Overall, 50% of our main manufacturing

sites are certified to ISO 14001. We are

continuing to develop procedures and

guidance for those sites not currently

certified, so that they are compliant

with the standards by the end of 2025

and ready to seek certification in 2026.

Noenvironmental fines or penalties have

been recorded in 2024 or 2023.

Energy and greenhouse gas

emissions

Central to our sustainability strategyis

reducing the carbon footprint of our

business and the impact our operations

have on climate change, including

minimising waste and reducing energy

consumption and greenhouse gas

emissions across all of our operations.

Wehave now submitted near-term and

Net Zero targets to the Science Based

Targets initiative (‘SBTi’) and developed

a Net Zero Transition Plan, as set out in

the ESG Leadership section.

Energy consumption and emissions data

We have continued to develop our end-to-end carbon footprint methodology, which includes a full emissions analysis for 2023 and

2024, as set out in the table below.

Scope

2024

ktCO

2023

ktCO

Movement

ktCO

e %

Scope 1 9.6 9.6 0.0 0%

Scope 2 (Location-based ) 10.6 11.0 (0.4) (3.6)%

Scope 2 (Market-based) 0.4 1.3 (0.9) (69.2)%

Scope 1 and 2 (Location-based) 20.2 20.6 (0.4) (1.9)%

Scope 1 and 2 (Market-based) 10.0 10.9 (0.9) (8.3)%

Scope 3 173.3 17 7. 3 (4.0) (2.3)%

Purchased Goods and Services 148.4 152.5 (4.1) (2.7)%

Capital Goods 2.9 2.2 0.7 31.8%

Fuel and Energy-related Activities 2.4 3.2 (0.8) (25)%

Upstream Transportation 8.7 8.2 0.5 6.1%

Waste 0.4 0.3 0.1 33.3%

We are also pleased to report the following

operational initiatives undertaken this year

to reduce our energy consumption and

greenhouse gas emissions:

• Completed the installation of solar

panels at our main extrusion facilities

in August 2024, which as of the

publication of this report have yielded

nearly 250,000 kWh of electricity at our

Clovernook site

• Increased the proportion of renewable

electricity we procure, from 94% in 2023

to 95% in 2024. This has largely been

through consolidation of activities onto

sites with existing renewable electricity

contracts in place

• Replaced the boilers at our main

extrusion site, Clovernook

• Continued to work to install LED lighting

across all sites, which is now c.80%

progressed, with a planned completion

date at the end of 2025

• Replaced 12 LPG trucks in our material

handling fleet with nine electric vehicles.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 31

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 31

Scope

2024

ktCO

2023

ktCO

Movement

ktCO

e %

Business Travel 0.4 0.8 (0.4) (50)%

Employee Commuting 1.9 1.8 0.1 5.6%

Upstream Leased Assets Not Applicable

Downstream Transportation Not Applicable

Processing of Sold Products 6.9 5.4 1.5 27.8%

Use of Sold Products Not Applicable

End-of-life Treatment 1.3 2.9 (1.6) (55.2)%

Downstream Leased Assets Not Applicable

Franchises Not Applicable

Investments Not Applicable

Total Scope 1, 2 and 3 (Location-based) 193.5 197. 9 (4.4) (2.2)%

Total Scope 1, 2 and 3 (Market-based) 183.3 188.2 (4.9) (2.6)%

Intensity ratio (tCO

e per £m of revenue) – Location-based 541 543 (2) (0.4)%

Intensity ratio (tCO

e per £m of revenue) – Market-based 513 516 (3) (0.6)%

Energy

FY24

MWh

FY23

MWh

Movement

MWh %

Total non-renewable fuels consumption 40,829 40,456 373 0.9%

Total renewable fuels consumption – – – –

Total renewable electricity consumption 48,805 49,756 (951) (1.9)%

Total non-renewable electricity consumption 2,382 3,430 (1,048) (30.6)%

Total renewable energy consumption 48,805 49,756 (951) (1.9)%

Total non-renewable energy consumption 43, 211 43,886 (675) (1.5)%

Total energy consumption 92,016 93,642 (1,626) (1.7)%

Notes to table:

•

We operate only within the United Kingdom and so values are for UK operations only

• A mathematical error was identified in the non-renewable fuels consumption energy figure in FY23. This has been corrected in the energy table and had no impact

onthe FY23 emissions calculation.

Notes to calculations:

•

Emissions and energy data presented for 2023 and 2024 is based on management estimates

• To calculate our emissions and energy usage data, we have followed the 2019 UK Government environmental reporting guidance. We have used the GHG Protocol

Corporate Accounting and Reporting Standard (revised edition). The Greenhouse Gas Protocol standard covers the accounting and reporting of seven greenhouse

gases covered by the Kyoto Protocol. We are reporting our Scope 3 emissions, with guidance from the GHG Protocol Corporate Value Chain (Scope 3) Accounting

and Reporting Standard and the GHG Protocol Technical Guidance for Calculating Scope 3 Emissions, as required

•

We have reported on all of the material emission sources from within the operational boundaries of the Group, as required under the Companies Act 2006 (Strategic

Report and Directors’ Reports) Regulations 2013 and under the UK’s Streamlined Energy and Carbon Reporting (‘SECR’) requirements

•

The Group has defined its organisational boundary using an operational control approach. Our reporting of Scope 1 and 2 emissions and energy data covers 100%

of our global operations. Furthermore, our reporting of Scope 3 emissions covers 100% of our upstream and downstream value chain

•

The emission factors from the UK Government’s GHG Conversion Factors for Company Reporting 2024 (the Department for Environment, Food and Rural Affairs (‘DEFRA’)

factors) have been used for all Scope 1 and 2 categories and the majority of Scope 3 categories. For spend-based calculations, the UK Environmentally-Extended

Input-Output (‘EEIO’) model factors were used. For weight-based calculations, EcoInvent and Idemat factors were used

•

In line with the Greenhouse Gas Protocol, we continue to review our reporting in light of any changes in business structure, calculation methodology and the accuracy

or availability of data.

Eurocell plc Annual Report and Accounts 202432 Eurocell plc Annual Report and Accounts 202432

SUSTAINABILITY REPORT CONTINUED

Energy consumption and

emissions performance

Our Scope 1 emissions were consistent

year on year despite movements within the

category. There was a significant decrease

in gas consumption at our Penny Emma

Way site. We were also able to obtain

more granular data on our refrigerant

assets. Together these drove a decrease

in Scope 1 emissions. However, due to

an error in categorisation of vehicles in the

prior year our diesel emissions increased

in 2024, offsetting the aforementioned

decrease. This error did not exceed our

restatement threshold and therefore no

prior-year restatement has been made.

Location-based Scope 2 emissions fell 4%

to 10.6 ktCO

e, and market-based Scope

2 emissions fell by 69% to 0.4 ktCO

both were driven by the reduction in

electricity consumption at our Eurocell

Recycling North (‘ERN’) site as our Phase 2

operations were moved to our other

recycling plant. As ERN is our only site

without renewable electricity being

procured, this significantly reduced

market-based emissions.

In combination, location-based Scope 1

and 2 emissions of 20.2 ktCO

e was down

2% compared to 2023 and market-based

Scope 1 and 2 emissions of 10.0 ktCO

was down 8% compared to 2023.

We have calculated our Scope 3

emissions for 2024 to be 173.3 ktCO

compared to 177.3 ktCO

e in 2023, a

decrease of 2%. This mainly reflects lower

emissions from Purchased Goods and

Services, down 4.1 ktCO

e, driven by a

slight reduction in spend.

The reduction in Fuel and Energy-related

Activities was caused by the respective

fall in Scope 1 and market-based Scope

2 emissions, and the fall in End-of-life

Treatment of Sold Products was caused

by a reduction in the emissions factor

for recycling, as a result of a previous

year error by DEFRA, which they have

addressed this year.

We successfully conducted an employee

commuting survey this year and

therefore was able to use actual data,

which could be extrapolated for the

emissions calculation. This resulted in an

increase from last year. We also obtained

energy use data from a larger number

of fabricators to calculate processing

emissions, meaning our calculation had

greater precision.

Reflecting these factors, total emissions

(Scope 1, 2 and 3) were down 2%

compared to 2023 for location-based, and

3% for market-based. However, due to a

slight decrease in revenue, the intensity

figures stayed reasonably consistent year

on year.

Total energy consumption of 92,016 MWh

in 2024 was a slight decrease on the

prior year of 2%, which reflects consistent

production volumes year on year.

Water consumption

Our main use of water is in the cooling

process for extrusion, but it is also used

to wash scrap PVC, remove impurities

in our recycling operations and for

employee welfare.

We have a closed loop water recycling

system in extrusion, and water supply bills

are scrutinised for abnormalities that would

indicate a leak, following which the water

provider would be contacted for repair.

The system significantly reduces the

environmental impact of our processes,

by conserving local water resources and

reducing the amount of contaminated or

unfiltered water entering back into the local

environment. Minimising consumption and

therefore reducing disposal costs also has

a financial benefit to our business.

We use only potable water, supplied

directly by the water provider, which is

suitable for drinking. We do not abstract

any ground or surface water. None of our

sites are located in high flood-risk areas

and all sites are provided with adequate

welfare facilities, in accordance with

governing legislation.

Water usage was identified as a key issue

for our stakeholders in our ESG materiality

assessment. Over the last few years, we

have strengthened our material recovery,

including improved water circularity. We

will continue the work to improve our water

usage data collection, and thereafter to

define targets to increase water efficiency

in our operations. This is dependent

on investment and process changes to

improve our existing closed-water loop

cooling systems.

Waste management

Our business and operations result

in waste and we are committed to

controlling, recovering and reusing waste

wherever possible. We promote the

efficient use of resources and materials

that are used in our facilities to help

reduce waste. We have a sustainable

procurement policy and we actively seek

to source sustainable products from

suppliers that are made from recycled

material where possible.

Total waste (kt) 2024 2023

To landfill 0.6 2.3

Recycled 16.6 19.3

Diverted from landfill 6.9 3.7

Total 24.1 25.3

During 2024, we continued our work

towards zero waste to landfill aspiration.

In 2024, our waste recycled proportion

fell to 69% (2023: 76%) despite the waste

being diverted from landfill, it was not

being recycled. Third-party collectors of

our waste are responsible for where the

waste goes and we will continue engaging

with them to ensure the disposal method

is used.

We have a target to increase waste

recycled by 2% per annum by the end

of 2025 vs our 2020 baseline (resulting

in 88% by 2025), and 1% per annum

thereafter (resulting in 93% by 2030).

We have also committed to a maximum

of 5% of waste to landfill by the end of

2025 and 1% by 2030.

To support delivery of these targets,

we have a new waste management plan,

focused on improving the processing of

by-products from our recycling process

(metal, rubber, wood). At third-party

sites, which act as collection and delivery

hubs for old windows which have been

replaced, we are implementing processes

that allow for cleaner waste streams. We

will also continue to develop partnerships

with waste services providers, to optimise

end-to-end material recovery.

Packaging accounts for c.5% of the waste

we generate. We aim to reduce this by

using thinner materials and packaging with

more recycled content, both for our own

products and in the delivery of raw material

to our sites.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 33

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 33

Hazardous materials

We do not use significant amounts of

hazardous materials. In our extrusion

business, we do not use phthalates,

cadmium or lead-based stabilisers.

In our recycling operation we monitor

the cadmium and lead contamination

levels within feedstock, to ensure

compliance with governing legislation.

Very small quantities of other hazardous

materials are currently used as

additives within our product mix, but

these are rendered non-bioavailable

when encapsulated by the polymer

structure. In addition, we have a specific

requirement within our new product

introduction process to reduce any use of

hazardous materials. For example, we are

investigating replacing the solvent-based

glue used in our foiling process with a

water-based alternative.

Eurocell plc Annual Report and Accounts 202434 Eurocell plc Annual Report and Accounts 202434

TRANSITIONING

TO NET ZERO

In our 2023 Annual Report, we committed

to achieving Net Zero emissions across

our operations by 2045. This will bring our

business in line with the aims of the Paris

Agreement to hold global temperature

increase to well below 2ºC, and with the

aims of the UK Government to achieve

Net Zero by 2050. Since publishing last

year’s report, we have further developed

our emissions reduction plans and have

submitted the following near-term and

long-term targets to the SBTi.

Scope 1 and 2

Reduce absolute Scope 1 and

2 GHG emissions 70% by

2034 from a 2022 base year

Near-

term

target

Reduce absolute Scope 1 and

2 GHG emissions 90% by

2045 from a 2022 base year

Long-

term

target

Scope 3

Reduce absolute Scope 3

GHG emissions 38% by 2034

from a 2022 base year

Near-

term

target

Reduce absolute Scope 3

GHG emissions 90% by 2045

from a 2022 base year

Long-

term

target

In common with many businesses, the

road to Net Zero will include estimates and

assumptions about unknown factors. We

will be transparent about the associated

risks and key steps to achieve this goal.

Our full Transition Plan, aligned to the

Transition Plan Taskforce Framework,

is published at: investors.eurocell.co.uk.

Business model

We do not anticipate any material change

to our business model or impact on

our value chain in our near or long-term

decarbonisation plan. We believe Scope

1 and 2 actions can be achieved under a

business-as-usual environment; however,

Scope 3 reductions are dependent on

multiple factors, including decarbonisation

ofour supply chain as outlined below.

Scope 1 and 2

(our own operations targets)

Over 50% of our Scope 1 and 2 emissions

are from electricity use, plus petrol and

diesel consumption in our operational

fleet and company cars. In our base year,

72% of the electricity we purchased was

renewable and in 2024 we increased this

to 95% (2023: 94%). The remaining Scope

1 and 2 emissions are associated with

natural gas use and refrigerant leakage

for heating and cooling purposes.

In the near term, we plan to decarbonise

our commercial fleet where economically

and practically possible. This will include

using telematics software to support

better driving behaviours and planned

routing to improve fuel efficiency. Wewill

also explore switching from diesel to

HVO, if sufficient fuel is available at an

acceptable price. We intend to replace

Company cars and delivery vans with

Battery Electric Vehicles (‘BEVs’) or

Plug-In Hybrid Electric Vehicles (‘PHEVs’)

as leases come up for renewal, although

the transition for vans will take longer

due to the need for further technological

advancement. We also plan to phase out

the use of LPG by transitioning forklifts

to electric as current leases expire.

Long term, we will explore replacing the

commercial fleet with fully electric or

hydrogen vehicles, although it is worth

noting that the switch to HVO substantially

eliminates fleet emissions. The remaining

actions include replacement of gas

consuming units with heat pumps or

electric boilers, as well as transition to

zero global-warming-potential (‘GWP’)

refrigerants in cooling systems.

Scope 3

(our value chain targets)

Our Scope 3 emissions are significantly

greater than our operational carbon

footprint. The largest exposure is

purchased goods and services (84%

of Scope 3), of which 42% relates to

virgin PVC resin and associated additive

materials, such as the modifiers and

stabilisers required to make PVC profile.

Using more recycled PVC in our

manufactured products is a key step

to reducing virgin resin consumption.

We plan to increase recycling content up

to our long-term target of 36% though

investment will be required to improve

tooling and other machinery to drive up

production yield. The principal limiting

factor to further increases in recycling

beyond our target is the availability of

feedstock (i.e. waste windows).

Thereafter, achieving our emissions

reduction target will require the use

of lower embodied carbon resin and

bio-based resin. Only a limited amount

of these products are available today,

and significant innovation and market

development is required to deliver sufficient

quantities of them at commercially viable

prices to achieve our targets.

SUSTAINABILITY REPORT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 35

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 35

2022 Scope

1 & 2

Growth

Renewable

Electricity

Fleet

Optimisation

Fleet HVO

Car EV

Van

Optimisation

Van EV

Forklift EV

Resulting

Emissions

2034

Target

-7.6

2022 Scope 3

-0.5

Growth

-3.9

Efficiencies

-2.1

Recycling

-0.7

Neovyn

-2.7

Bio-resin

-1.0

Supplier

Engagement

5.8

Services

3.2

4.8

Driver

Emissions (ktCO

e)Emissions (ktCO

15.9

Transport

Fabricator

Business

Travel

Employee

Commuting

Scope 1 & 2

Resulting

Emissions

2034 Target

194.9

68.4

-40.7

-17. 2

-3.2

-38.5

-23.5

-2.9

-4.5

-4.8

-0.6 - 1.6

-4.7

12 1.1 12 1. 8

Scope 1 and 2 Near-term Emissions Pathway

5.0

10.0

15.0

20.0

25.0

Scope 3 Near-term Emissions Pathway

100.0

150.0

200.0

250.0

300.0

50.0

The Scope 3 emissions reduction target

is also dependent on increased supplier

engagement and collaboration with

respect to the other products we buy.

Weare dependent on key suppliers setting

and meeting their own Net Zero targets.

Additional initiatives to be implemented to

reduce remaining value chain emissions

include cultural and policy changes

within the business, such as encouraging

staff to switch personal cars to EVs and

persuading fabricators to use renewable

electricity in their operations.

Eurocell plc Annual Report and Accounts 202436 Eurocell plc Annual Report and Accounts 202436

SUSTAINABILITY REPORT CONTINUED

SUSTAINABLE

PRODUCTS

Innovative low-carbon products

We are committed to minimising the

environmental impact of our products

throughout their lifecycle. Our use of

recycled PVC provides low-embodied

carbon products for customers and

prevents PVC waste from going to landfill.

We also focus on developing thermally

efficient products that help our customers

minimise heat loss and reduce their

energy costs.

In the future, we intend to disaggregate

emissions to product level and develop an

embodied carbon footprint for each major

product, if feasible, to aid customers in

making informed purchasing decisions for

lower-carbon products.

Recycling operation

We are proud to be the leading UK-based

recycler of PVC windows. Our extensive

recycling capacity sits at the heart of our

operations, our sustainability strategy, and

will be critical to our Net Zero ambitions.

Our recycling operations process

post-industrial and post-consumer

waste into recycled material, 62%

(2024) of which is then used in our own

operations to produce our products.

Mostoftheremaining by-product is scrap

metal, which is sold to metal recyclers,

with very little sent to landfill.

Recycling operation benefits:

• Commercial: Addresses

customer demand for sustainable,

low-carbonproducts

• Economic: Increases profits

due tolower production cost of

recycledcompound

• Carbon savings: Lower-embodied

emissions of recycled material are

crucial for Net Zero transition and

meeting SBTi targets.

2024 highlights:

• 32.9k tonnes of post-consumer waste

and 8.5k tonnes of post-industrial

wasterecycled

• 18.0k tonnes of recycled materials

were used in manufacturing our rigid

PVC profiles, and 7.3k tonnes used

in 100% recycled products or sold to

tradeextruders

• Recycled PVC represented 32% of total

raw material consumption.

Our ambition

Our recycled content target has been

adjusted to 36% by 2030, and this

represents a crucial part of our Net Zero

Transition Plan. Delivery will be dependent

on several factors such as:

• Supply of recycled feedstock –

toreach our recycled content target

of 36%, alongside our sales growth

ambitions, will require a significant

increase in feedstock supply at

acceptable purchase prices

• Legislative limitations – we will

need to monitor any future changes in

legislation and understand the potential

impact on our targets

• Operational capacity – increased

recycled content requires further

investment in co-extrusion capacity and

tooling, which is included in our ongoing

investment plans

• Technological limitations – it is not

currently commercially viable to use

large quantities of recycled PVC in foam

profile products.

The percentage of revenue from low-carbon

products this year was 22% (2023: 22%).

This represents all products that are

co-extruded (contains recycled and virgin

PVC content) or 100% recycled.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 37

Thermally efficient products

Our window and door products are

designed for enhanced thermal efficiency

through low-thermal conductivity,

measured by U-values. Our mainstream

PVC fenestration products meet the Future

Homes Standard level of 1.2 W/m2K,

with some products reaching as low as

0.8 W/m2K.

End of life

It is our aim to continue to recycle as

much PVC as possible, moving where

possible towards closed-loop recycling,

whereby windows and other PVC profiles

are continually recycled into new products.

Our PVC profiles can be recycled up to

ten times and have a life span of around

100 years.

Responsible sourcing

Eurocell sources raw materials and

traded goods from manufacturers

worldwide. We have systems and

processes in place to maintain ethical

andsustainable relationships, for example,

pre-appointment checks, in-life supplier

reviews and contractual provisions for

compliance with regulatory standards.

TheHead of Procurement manages

supplier relationships and value chains.

Product quality and safety

Our goal is to provide high-quality

products and services that satisfy our

customers. We conduct thorough testing

on all products for both quality and

product safety reasons. We continuously

improve our performance and adhere to

ISO 9001 and other quality standards.

Our manufacturing sites are accredited

to ISO9001, and we operate clear

systems and procedures. We also provide

necessary training and support to our

colleagues, so they are able to play their

part in delivering high standards of product

and service quality.

Case study

Neovyn in Modus products

In 2024, we ran a successful trial to include a lower-embodied carbon

resin in our Modus range of window profile.

INEOS, one of our key resin suppliers, now produces a PVC resin (Neovyn),

which has a footprint of 1.3 kg CO

eq/kg PVC, 37% lower than the EU

industry average. This has been achieved through switching to the use of

renewable electricity for production.

Looking forward, we will consider increasing the use of Neovyn in other

profile ranges. As noted elsewhere in this report, we are also monitoring

the development of bio-attributable alternatives to traditional PVC resins,

although at present these are not available in sufficient quantities at

commercially acceptable prices.

Darren Waters, CEO said:

“By integrating Neovyn into the Modus profile, we’re able to offer a

product that not only delivers on exceptional energy performance

but alsorepresents a substantial reduction in carbon emissions.”

Eurocell plc Annual Report and Accounts 202438 Eurocell plc Annual Report and Accounts 202438

SUSTAINABILITY REPORT CONTINUED

ETHICS AND

COMPLIANCE

Modern slavery

We have zero-tolerance for any form of

modern slavery or human trafficking, and

are absolutely committed to preventing

modern slavery and human trafficking in

our business activities and supply chains.

We support the aims of the UK’s Modern

Slavery Act and publish our Anti-Slavery

and Human Trafficking Statement, which

is approved by the Board annually, on our

website at: investors.eurocell.co.uk.

We also conduct ongoing reviews of our

suppliers to identify any potential risks.

Inaddition, our employee induction

process includes mandatory training

on our Modern Slavery and Human

TraffickingPolicy.

Whistleblowing

We are committed to the highest

standards of openness, honesty, integrity

and accountability. The Group has a

Whistleblowing Policy, and we take active

steps to raise employees’ awareness of

our whistleblowing platform.

This Policy makes all employees aware

that they should report any serious

concerns or suspicions about any

wrongdoing or malpractice on the part

of any colleague of the Group, without

fear of criticism, discrimination or reprisal,

as well as the procedure for raising

such concerns. Examples include fraud,

breakdown in internal controls, misleading

customers, bribery, modern slavery,

dishonesty, corruption and breaches of

data protection or health and safety.

All whistleblowers are protected under

the Public Interest Disclosure Act.

Our independent whistleblowing

hotline, which supports confidential and

anonymous reporting, is available to all

employees, contractors and suppliers,

24/7, 365 days a year. Each case is

investigated confidentially by the business

with appropriate response measures

taken. Whistleblowing cases are reported

to the Audit and Risk Committee and

ultimately to the Board.

Any reports are assessed by our triage

team and also reported to Alison Littley,

Non-executive Director and Board

Whistleblowing Champion. Each case was

found to represent a colleague grievance

matter, rather than a whistleblowing event,

and no wrongdoing trends were identified.

Anti-bribery and corruption (‘ABC’)

We are committed to acting fairly and

with integrity, and take a zero tolerance

approach to bribery, corruption or

any other unethical or illegal business

practices. Applying to all employees and

suppliers, we explicitly prohibit any form

of bribery or corruption, including:

• Money laundering

• Facilitation payments, which are typically

unofficial payments made to secure or

expedite a routine government action

by a government official

• Kickbacks

• Political contributions

• Sponsorships.

In addition, we are committed to

minimising any conflicts of interest,

whereby an individual’s personal interests

may compromise their judgement in the

workplace, that may arise.

We will take disciplinary and/or legal

action as appropriate in all cases of

actual or attempted fraud across all

operations. Wewill not obstruct any formal

investigations or legal proceedings relating

to any incident of corruption at Eurocell.

All staff complete training on our Anti-Bribery

Policy as part of their induction, and are

subsequently required to complete refresher

training each year. In 2024, there were no

incidents of employees being disciplined or

dismissed due to non-compliance with our

Anti-Bribery Policy (2023: nil).

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 39

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 39

The Audit and Risk Committee, ultimately

reporting to the Board, is responsible for

reviewing the policies and procedures in

place to prevent bribery, and for ensuring

compliance across the Group. The

Committee is satisfied that the Group’s

procedures with respect to these matters

are adequate. During the year, the impacts

of the Economic Crime and Corporate

Transparency Act (2023) were assessed,

and a review is in progress to ensure

compliance with the revised requirements.

Human rights

We do not consider human rights issues to

be a material risk for the Group due to the

existing regulatory frameworks in the UK,

within which our operations are confined.

We do, however, acknowledge there is

greater risk in our supply chain, and are

therefore committed to conducting due

diligence across our supply chain, in line

with the Modern Slavery Act. In addition,

employees and other relevant internal

and external stakeholders can report any

concerns relating to human rights across

Eurocell’s direct operations or supply chain

through our confidential whistleblowing

channel. No violations on human rights

have been reported in 2024 or in the

previous three years.

Information systems and

technology (‘IS&T’)

At Eurocell we respect the privacy of

colleagues, customers, suppliers and all

other parties with which we interact. We

seek to minimise the amount of personal

data we collect, and to ensure the robust

and sufficiently segregated storage of any

data that is held.

Information security and cyber threats are

increasing risks. In 2022 we experienced

a cyber incident which caused disruption

to our operations and compromised the

security of some employee personal

data. Cyber security continues to receive

considerable management attention,

as well as focus from the Audit and

Risk Committee and the Board. This is

also reflected in the results of our ESG

materiality assessment, which placed

cyber and data security among the most

material issues facing the business.

Since the incident in 2022, we have:

• Rolled out an extensive programme of

mandatory cyber security training to all

colleagues in a series of monthly short

videos and quizzes covering a range

ofsecurity threats and ways to mitigate

the risks

• Strengthened our cyber risk detection

tools, including vulnerability analysis

penetration testing

• Strengthened our incident response

measures through implementing

managed detection and response (‘MDR’),

security instant event monitoring

(‘SIEM’), privileged access management

(‘PAM’) and firewall hardening

• Reviewed the performance of our

business continuity plans and made

appropriate adjustments in response to

the incident to identify gaps and areas

for improvement.

Tax transparency

We recognise the responsibility we have

to our stakeholders and communities to

set the highest standards of corporate

conduct, and paying the right amount

of tax is fundamental to this. Across our

entire operations, we are committed to

compliance with tax law and practice,

and are committed to compliance with

the spirit as well as the letter of the law.

Our Tax Strategy is reviewed, discussed

and approved by the Board annually

andour Tax Policy is available at:

investors.eurocell.co.uk. The Audit and

Risk Committee periodically reviews the

Group’s tax affairs and risks.

We have held the Fair Tax Mark

accreditation since 2019. Fair Tax Mark

is an independent certification, which

recognises organisations that demonstrate

they are paying the right amount of

corporation tax in the right place, at the

right time.

Section 172 statement

The Board reviews all matters and

decisions through the consideration

anddiscussion of reports which

are sentin advance of each of their

meetings and through presentations

to the Board. When the Directors

discharge their duty as set out in

section 172 of the Companies Act

2006(‘section 172’ or ‘s.172’), they

have regard to the other factors set

out on page 72.

The Directors are required to include

a statement of howthey have had

regard to stakeholders and the other

factors setout in section 172(1)

(a) to (f) when performing their duty.

The full s.172(1) statement may be

found on pages 72and 76. On pages

72 to 76, wehaveset out examples

of how the Directors have had regard

to the mattersin s.172(1)(a) to (f) when

discharging their section 172 duty.

Non-financial and sustainability

information

In order to consolidate our reporting

requirements under sections 414CA

and 414CB of the Companies Act 2006

in respect of Non-Financial Reporting,

the table on page 89 shows where in

this Annual Report and Accounts to find

each of the disclosure requirements.

Eurocell plc Annual Report and Accounts 202440 Eurocell plc Annual Report and Accounts 202440

TCFD

We are committed to retaining our

status as a leader in sustainability

within the fenestration sector.

We recognise that climate change poses significant risks and opportunities to

ourbusiness and stakeholders. Our TCFD report demonstrates how we incorporate

climate-related risks and opportunities into the Group’s strategic planning,

decision making and risk management processes, aligned to our Net Zero ambition.

Task Force on

Climate-related

Financial Disclosures

(‘TCFD’)

We previously set our Net Zero target

date as 2045. We have now set an interim

target year of 2034, and submitted our

emissions reduction targets to the Science

Based Targets initiative (‘SBTi’) framework.

We have also published a Net Zero

Transition Plan, detailing our pathway to

achieving these target dates. The pathway

includes updated objectives for some

of our ESG KPIs (e.g. greenhouse gas

emissions and energy use) in line with our

overall Net Zero goal.

This year we have also enhanced our

analysis of transition and physical

climate-related risks with quantification,

helping us to assess their impact and

develop plans to mitigate risks and

maximise opportunities.

The Board considers that the climate-related

risks and opportunities of the business are

integrated with the risks and opportunities

of the Group, and that as such, any

climate-related impact on the Group would

originate in the operating businesses.

The assessment of the impact of climate

change on the value of the Group is

carried out at least annually, or when a

triggering event occurs, and no impairment

charge has arisen. The interests of the

Group’s internal and external stakeholders

are also considered as part of this

assessment, when appropriate.

The Board has noted the requirement for

mandatory climate-related disclosures

arising from the Companies (Strategic

Report) (Climate-related Financial

Disclosure) Regulations 2022, as well

as FCA UK Listing Rule 6.6.6R.

On the following page we have set out

our climate-related financial disclosures,

cross referenced in the table opposite,

fully consistent and compliant with all

of the 11 TCFD recommendations and

recommended disclosures as detailed in

‘Recommendations of the Task Force on

Climate-related Financial Disclosures’,

2017, with additional guidance from

‘Implementing the Recommendations

of the Task Force on Climate-Related

Financial Disclosures’, 2021.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 41

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 41

Detail on the 11 recommended disclosures can be found on the following pages:

Recommendation Recommended disclosures Reference

Governance

Disclose the organisation’s

governancearound climate-related

risks and opportunities.

a) Describe the Board’s oversight of climate-related risks and opportunities Page 41

b) Describe management’s role in assessing and managing climate-related

risks and opportunities

Page 42

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.

a) Describe the climate-related risks and opportunities the organisation has

identified over the short, medium, and long term

Pages

44 to 50

b) Describe the impact of climate-related risks and opportunities on the

organisation’s businesses, strategy, and financial planning

Pages

44 to 50

c) Describe the resilience of the organisation’s strategy, taking into consideration

different climate-related scenarios, including a 2°C or lower scenario

Pages

44 to 50

Risk Management

Disclose how the organisation

identifies, assesses, and manages

climate-related risks.

a) Describe the organisation’s processes for identifying and assessing

climate-related risks

Page 43

b) Describe the organisation’s processes for managing climate-related risks Page 43

c) Describe how processes for identifying, assessing, and managing

climate-related risks are integrated into the organisation’s overall

riskmanagement

Page 43

Metrics and Targets

Disclose the metrics and targets used

to assess and manage relevant

climate-related risks and opportunities

where such information is material.

a) Disclose the metrics used by the organisation to assess climate-related risks

and opportunities in line with its strategy and risk management process

Pages

44 to 50

b) Disclose Scope 1, Scope 2, and, if appropriate, Scope 3 greenhouse gas

(‘GHG’) emissions, and the related risks

Pages

30 to 32

c) Describe the targets used by the organisation to manage climate-related

risks and opportunities and performance against targets

Page 24

Governance

Board oversight of climate-related risks and opportunities

The Board reviews and is ultimately accountable for all ESG matters, including climate-related issues and progress against

climate-related targets. Board expertise on climate change and ESG more broadly is provided by Alison Littley (Non-executive

Director), Chair of the Social Values and ESG Committee. This Committee provides oversight of the Group’s ESG programme,

including climate change, and monitors progress against climate-related targets.

The Committee includes four independent

Non-executive Directors, including Alison

Littley (Chair). The Chief Executive,

Chief Financial Officer, Head of Safety,

Health and Environment, and our People

Director, are also members and it meets

at least three times per annum. Relevant

senior management are invited to attend

Committee meetings as appropriate to the

agenda. Alison Littley updates the Board

on the activities of the Committee at Board

meetings, which typically follow within one

day of the Committee meeting.

The Committee accesses specialist

advice on ESG matters and has engaged

with expert sustainability consultants

throughout the target-setting and

transition-planning process. In 2024,

the Committee also facilitated a teach-in

session for all Board members on

climate-related issues and developments.

Following submission of our targets to

the SBTi, the associated action plans

have been cascaded to the relevant

senior management responsible for

delivery. TheSocial Values and ESG

Committee, will continue to oversee

and monitor progress towards our Net

Zero targets andreceive regular updates

from Executive Committee members on

performance against the key milestones

ofthe Transition Plan.

The Executive Committee has day-to-day

responsibility for identifying, assessing,

monitoring and managing risks. The

Committee meets monthly, with risk

management included as a standing

agenda item to facilitate the discussion

and management of any emerging or

increasing risks, including climate-related

risks (both physical risks at site level, and

transitional risks). Our operational and

commercial leaders also consider any

climate-related risks within their respective

business units, through discussions with

site managers, and local and regional

branch managers. As previously noted,

the Executive Committee consolidates

these discussions with a full risk register

review every six months, with the results

reported to the Audit and Risk Committee.

Eurocell plc Annual Report and Accounts 202442 Eurocell plc Annual Report and Accounts 202442

TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES

CONTINUED

Board

Ultimately accountable for climate-related issues:

Social Values and

ESG Committee:

Formal oversight of climate change and

responsible

for climate-related targets

Audit and Risk

Committee:

Supports the Board with responsibilities

for risk management

Remuneration Committee:

Will investigate integrating climate

performance into remuneration packages

this year

Executive Committee

Responsible for operationalising the climate change multi-year plan

Day-to-day responsibility to assess, monitor and manage climate-related risks and opportunities

Profiles Division

Consolidate, monitor and manage climate-related risks

atsubdivisional level shown below

Building Plastics Division

Consolidate, monitor and manage climate-related

risks atdivisional level

Operations Sales Vista Local and regional

branch leads

Identify, report and monitor site-level climate-related risks Identify, report and monitor branch-level climate-related risks

Climate-related governance framework

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 43

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 43

Risk management

Group risk management process

overview

The Board is also responsible for risk

management, supported by the Audit

and Risk Committee and informed by

the Executive Committee. The Board

defines risk appetite and monitors the

management of significant risks, including

climate-related risks and opportunities.

Climate-related risks are included in the

Group risk register, which is reviewed and

subsequently presented to the Audit and

Risk Committee by Executive Management

biannually. Responsibility for each risk on

the Group risk register is allocated to a

member of Executive management,

with responsibility for sustainability and

climate change risk allocated to the

Chief Executive.

Processes to identify, assess and

monitor climate-related risks

Sustainability and climate change is

deemed a principal risk for the Group

and is therefore included on the strategic

risk register.

Our risk assessment process considers

existing and emerging risks and all risk

categories outlined in the TCFD

recommendations in relation to our

operations. Climate-related risk

identification is performed both bottom-up,

through a detailed assessment at

operational site level, as well as top-down,

through an assessment of strategic and

market risks.

Site-level environmental risks, including

climate-related risks, are identified as

part of our operational risk assessments.

Our Head of Estates and Facilities

Management is responsible for identifying

and assessing the environmental risks

of existing and potential sites. Any risks

identified will be escalated to the relevant

Executive Committee member, who

consolidates risks within their own area of

responsibility and reports to the monthly

Executive Committee meeting. In most

cases, the relevant Executive Committee

member is either the Chief Operating

Officer (for the Branch Network and

supplychain) or the Chief Executive

(for all other sites).

Identifying and assessing environmental

risks at our branch sites is largely via

environmental surveys. Our branches

are typically leased on individual 10-year

contracts, with 5-year break clauses

that can be exercised if a risk becomes

unacceptable.

Environmental risks at our operational sites

are managed through the local business

continuity plans, held by our operational

managers for extrusion, warehousing and

secondary operations sites respectively.

The business continuity plans are tested

periodically and updated for any required

improvements. We have enhanced our

site-level assessment of physical

climate-related risks using a physical risk

analysis software tool, which has provided

greater depth to our risk analysis.

Risk rating process

Climate-related risks are assessed and

prioritised in a similar way to all other risks

on the Group’s strategic risk register.

Risks are assessed on a five-point scale

for both the probability and impact of

the risk occurring, providing an overall

risk rating calculated by multiplying the

probability by the impact.

The probability ranges from A (Almost

Certain) to E (Rare), whilst we assess

the impact on a scale of 1 (Very High)

to 5 (Very Low). The impact rating is

financial, measured in absolute terms or

as a percentage of EBITDA per annum.

However, for certain risks, the impact

rating may also reflect the impact on the

Group’s reputation or on the environment,

or whether the effect is localised or

widespread. The resulting overall risk rating

categories are: Negligible, Low, Medium,

High or Critical.

Now that we have determined our Net

Zero Transition Plan, we have developed

our assessment of climate-related risks

and opportunities and now consider them

on a net (mitigated) basis. We continue to

provide details of mitigation strategies and

plans to capitalise on opportunities.

Risks on our strategic risk register are

generally assessed on a three-year

business planning cycle. Recognising the

longer time horizon of many climate-related

risks, however, the following timescales

areapplied:

Scale Criteria

Short

term

0–3 years (in line with our

strategic planning and risk

management horizon)

Medium

term

3 years–2034 (aligned to our

Interim Net Zero target in 2034)

Long

term

2034–2045 (aligned to our

Net Zero target, the useful

life of our facilities and

encompassing long-term policy

and industry trends)

This year, with the help of expert

sustainability consultants, we have

reviewed and updated our assessment

of climate-related risks and opportunities

across the Group in line with the TCFD

reporting requirements.

Managing and integrating climate

into wider risk management

As described above, risk management,

including climate change, is now a

standing agenda item for the monthly

meetings of the Executive Committee.

This includes consideration of divisional

level risks and the status of ongoing

mitigating actions, as well as a review of

any emerging or increasing risks. Every

six months, each division will conduct

a review of its risks with the Group Risk

Management team in advance of the

Executive Committee’s in-depth risk

Eurocell plc Annual Report and Accounts 202444 Eurocell plc Annual Report and Accounts 202444

Strategy

Our approach to climate

scenario analysis

In 2023, we undertook a substantial

qualitative analysis of the resilience of our

business model and strategy under the

guidance of an independent third-party

consultant, CEN Group. Physical risks

were analysed using four scenarios from

the Intergovernmental Panel on Climate

Change (‘IPCC’) embedded in the Munich

Re software platform used to analyse

physical risks of climate change:

• RCP 2.6: a climate-positive pathway,

likely to keep global temperature rise

below 2°C by 2100. CO

emissions

start declining by 2020 and get to zero

by2100

• RCP 4.5: an intermediate and probably

baseline scenario more likely than not to

result in global temperature rise between

2°C and 3°C by 2100 with a mean sea

level rise 35% higher than that of RCP

2.6. Many plant and animal species will

be unable to adapt to the effects of RCP

4.5 and higher RCPs. Emissions peak

around 2040, then decline

• RCP 7.0: a baseline outcome rather

than a mitigation target and represents

the medium-to-high end of the range of

future emissions and warming resulting

from no additional climate policy

• RCP 8.5: a bad case scenario where

global temperatures rise between 4.1–

4.8°C by 2100. This scenario is included

for its extreme impacts on physical

climate risks as the global response to

mitigating climate change is limited.

For the transition risks and opportunities,

we have used the following climate-related

scenarios from the International Energy

Agency, which are far more descriptive

and useful for modelling more positive

climate outcomes. The scenarios have

been considered at a high-level, whereby

transition risks are generally greater

(more likely and with greater impacts) in

the lower-carbon scenario compared to

the higher-carbon scenario.

• Net Zero 2050 (‘NZE’): an ambitious

scenario, which sets out a narrow

but achievable pathway for the global

energy sector to achieve Net Zero CO

emissions by 2050. This meets the

TCFD requirement of using a ‘below

2°C’ scenario and is included as it

informs the decarbonisation pathways

used by the Science Based Targets

initiative (‘SBTi’), which validates

corporate Net Zero targets and ambition.

• Stated Policies Scenario (‘STEPS’):

ascenario, which represents the roll

forward of already announced policy

measures. This scenario outlines a

combination of physical and transitions

risk impacts as temperatures rise by

around 2.4°C by 2100 from pre-industrial

levels, with a 50% probability. This

scenario is included as it represents a

base case pathway with a trajectory

implied by today’s policy settings.

Climate-related risks and

opportunities

Seven climate-related risks and five

climate-related opportunities, that could

have a material impact on the Group,

have been identified, which are discussed

below on a net (mitigated) basis.

Following third-party and internal

analyses of these climate-related risks

and opportunities, our current view is that

significant financial planning or budgetary

change as a result of climate change is not

likely to be required.

TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES

CONTINUED

Key risks

Six transitional, and one physical climate-related risks, have been identified.

Operational exposure to carbon pricing mechanisms TCFD Category: Transition (Policy and Legal)

Own operations

Higher costs associated

with energy

Short-term

Impact: 4 (Low)

Likelihood:

A (Almost certain)

Net Risk Rating:

Medium risk

Scenario: NZE

Metrics: Scope 1 and 2

emissions

Risk

Increased operational costs as a result of exposure to carbon pricing mechanisms.

Description

The implementation of operational carbon pricing is one of the levers used by regulators to achieve

decarbonisation of energy and industrial production, either through higher energy costs or direct carbon

taxes applied to our gas and electricity used (Scope 1 and 2 emissions). We forecast this impact to be

greatest in the short term, and to decrease over the medium and long term as we achieve emissions

reduction in line with our Net Zero ambitions. Forecast prices are greater in the NZE Scenario.

Mitigation

The impact of the risk is expected to be moderated through our efforts to reduce Scope 1 and 2

emissions to minimal levels, with the key actions identified and included in our Net Zero Transition Plan.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 45

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 45

Carbon pricing in the value chain TCFD Category: Transition (Policy and Legal)

Upstream

Increased cost of

purchased goods and

inbound transportation

Short-term

Impact: 1 (Very high)

Likelihood: D (Unlikely)

Net Risk Rating: High risk

Scenario: NZE

Metrics: Scope 3

emissions (Category 1)

Risk

Increased costs throughout the supply chain due to carbon pricing pressure.

Description

Our ability to continue to reduce emissions in line with our 2045 Net Zero target will be influenced by

some factors beyond our control, such as the decarbonisation of electricity grids, increased costs

of raw materials as suppliers work to meet decarbonisation targets, and the development of zero

emissions transportation. Investment in lower-carbon processing, equipment and facilities impacts

the cost of raw materials. The development of a low-embodied carbon alternative to virgin PVC resin

at a commercial price is the most significant of these supply chain risks for Eurocell, which could lead

to increased costs. The fossil fuel industry is exposed to global regulatory and policy decisions in the

drive to reduce emissions, and these changing policies may also impact the reliability of our supply

chain and the price of our key raw materials.

Mitigation

We engage with key suppliers to understand their own plans to reduce emissions and improve the

sustainability of their products. We closely monitor the development, availability, pricing, quality and

carbon footprint of new products that produce PVC from alternatives to fossil fuels, such as bio-based

raw materials.

Failure to achieve our recycling targets TCFD Category: Transition (Market, Reputation)

Own operations and

Upstream

Higher costs, lower

revenue

Medium and long-term

Impact: 1 (Very high)

Likelihood: C (Possible)

Net Risk Rating:

Critical risk

Scenario: STEPs

Metrics: Scope 3

emissions; % of recycled

PVC used in production

Risk

Failure to reduce carbon emissions through inability to increase the proportion of recycled PVC used

in production.

Description

The percentage of recycled PVC used in our production process has increased steadily in recent

years, up to 32% in 2023 and 2024. Our medium-term target is to increase this to 36% by 2030

and thereby reduce Scope 3 emissions. The biggest risk to achieving our target is the availability of

sufficient feedstock at acceptable prices. This risk increases in the medium and long term as we need

to source sufficient feedstock to achieve the 36% target and match our planned growth. We also

require building standards and regulations to continue to support the use of recycled PVC.

Mitigation

To source sufficient material, we will engage with existing and potential new suppliers, housing

associations and fabricators to maintain and increase our supply of waste PVC, using longer-

term contracts with larger suppliers where possible. We will continue to invest in research and

development, and tooling to increase the yield in our recycling plants. We will also engage with

governmental and industry bodies to help shape product and building standards to support

increaseduse of recycled PVC in our products.

Eurocell plc Annual Report and Accounts 202446 Eurocell plc Annual Report and Accounts 202446

Cost of capital and investor interest linked to sustainability

criteria

TCFD Category: Transition (Market, Reputation)

Own operations

Higher cost of capital

Medium-term

Impact: 5 (Very low)

Likelihood: B (Likely)

Net Risk Rating: Low risk

Scenario: NZE

Metrics: Scope 1, 2 and

3 emissions; UK interest

rates

Risk

Increased cost of capital and/or decreased access to funding through failure to meet performance

and disclosure requirements.

Description

Increased investor and lender expectations in relation to sustainability performance and disclosure

creates risks on the availability and cost of capital. With an existing revolving credit facility of £75m

extending to 2027, our funding risk is minimal in the short term. However, over the medium term,

investors and banks are expected to be more stringent and withdraw funding or apply punitive

charges if ongoing targets on emission reduction are not aligned to their own Net Zero targets.

Mitigation

We remain in continued dialogue with lenders, rating agencies, investors and sustainability experts to

ensure our climate change disclosure is in line with the latest regulatory requirements. Completing a

materiality assessment, incorporating the views of investors and banks, has ensured we are focused

on priority ESG topics, with action plans to reduce emissions built in to our Net Zero Transition Plan,

including associated targets and KPIs.

Customer and consumer pressure TCFD Category: Transition (Market, Reputation)

Downstream

Lost revenue

Medium-term

Impact: 3 (Medium)

Likelihood: B (Likely)

Net Risk Rating: High risk

Scenario: NZE

Metrics: Scope 3

emissions; thermal

efficiency of products

(U-value)

Risk

Loss of customers and revenue through failure to meet customer standards and consumer preferences.

Description

Large house builders generally prefer suppliers who are at the forefront of embodied carbon reduction

and who supply products which reduce energy use. If we do not continually improve our performance

in this area, including meeting the relevant disclosure or regulatory requirements as they develop

(e.g.disclosure of embodied carbon in the products we supply), we could, over time, lose customers

and market share. In addition, consumer awareness of their own carbon footprint is continuing to

increase and a growing desire for sustainable living is resulting in changes to demand patterns, with

an increased preference for lower-embedded carbon products. There is a medium-term risk that

some product lines will no longer be of interest to customers aligning with Net Zero.

Mitigation

We engage with customers to ensure new products are designed to meet their changing

requirements, and that our targets are aligned with theirs, and meet internal and external

environmental requirements. We focus on energy efficient windows and improved insulation to

enable housebuilders to achieve desired EPC ratings on their new builds and meet the technical

specifications they require for zero carbon homes. Our full carbon footprint analysis, including

Scope 3 emissions, will enable us to calculate the embodied carbon in our PVC profile if required.

Key risks continued

TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES

CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 47

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 47

Existing and emerging government standards and regulation TCFD Category Transition (Policy and Legal)

Own operations

Higher costs/disruption

of production

Medium-term

Impact: 4 (Low)

Likelihood: B (Likely)

Net Risk Rating: Medium

risk

Scenario: NZE

Metrics: R&D expenditure

to meet regulatory

standards

Risk

Increased costs of production and associated R&D to ensure products meet increasing government

standards. Possible disruption to production as standards are implemented.

Description

The Group may be adversely affected by changes in government and other regulations relating to

the manufacture and use of materials and resources; particularly energy use in homes and carbon

commitments, as well as the use of plastics and polymers in our manufacturing process. The Future

Homes Standard (‘FHS’) regulation requires a 75–80% reduction in carbon emissions from new

homes, although the precise timing and transition period are still to be confirmed. These specifications

will need to be met when constructing, extending or renovating UK homes, and large housebuilders

aiming to achieve ‘zero-carbon homes’ will likely focus on using products that help customers save

energy. If Eurocell products do not align to these new standards, we will lose market share and suffer

reputational damage.

Mitigation

We engage and consult regularly with regulators and participate in the Future Homes Hub to

support the Future Homes Delivery Plan – a sector-wide plan to embed key environmental issues

into housebuilding. We have established an R&D programme and several of our products already

meet these regulations. We also engage with customers and suppliers to support meeting future

regulations. We are developing thermally efficient products to help our customers minimise heat loss,

such as the Modus triple glazed widow.

Flood risk TCFD Category: Physical (Chronic)

Own operations

Higher costs/disruption

of production

Short, medium

and long-term

Impact: 5 (Very low)

Likelihood: C (Possible)

Net Risk Rating:

Negligible risk

Scenario: RCP 8.5

Metrics: Number of

flooding incidents; costs

of flood incidents

Risk

Cost of damages, lost revenue (loss of sales and disruption to operations), and increased insurance

premiums resulting from increasing flood events across operational and branch sites.

Description

Changing weather patterns and an increase in the number and severity of extreme weather events have

caused issues relating to flooding, across the United Kingdom. The Munich Re Location Risk Intelligence

Tool was used to assess physical climate risk and we considered a cross section of branches and all

our manufacturing and recycling plants. Of the sites assessed, no material flood risks were identified.

Given the current flooding issues in the UK, we consider flood risk to be the most significant (though low)

physical risk to the Group and to increase in higher temperature scenarios.

Mitigation

All divisions have business continuity and recovery plans, which monitor risks to staff and premises

from metrological events. Additionally, all sites have flood damage insurance cover with limits that

reflect the magnitude of risk. The diversified locations, as well as flood risk assessment prior to lease

contracts being signed, mean it is unlikely that several sites would flood at any given time, and hence

the financial impact would be minimal.

Eurocell plc Annual Report and Accounts 202448 Eurocell plc Annual Report and Accounts 202448

Key opportunities

Five opportunities have been identified that could have an impact on our business, either through enhanced revenues or

decreased costs and emissions.

Increased recycling, process innovation and material efficiency TCFD Category: Resource Efficiency

Own operations/

downstream

Decreased costs

Long-term

Impact: 3 (Medium)

Likelihood: D (Unlikely)

Net Rating: Medium

opportunity

Scenario: NZE

Metrics: Scope 3

emissions; revenues

from energy-efficient

products

Opportunity

Cost and emissions reductions through increased recycling, and production and material efficiency.

Description

The use of recycled PVC pellets typically has an embodied carbon footprint c.50% lower than virgin PVC

pellets. The cost of producing recycled material is usually lower than the purchase cost of virgin material,

and substantially lower than the cost of alternative resins that will otherwise be required to meet our Net

Zero ambitions. Therefore, products manufactured through efficient processes with increased recycled

material content can significantly lower our cost of production and reduce carbon emissions, and will

be an important part of our transition to Net Zero. This opportunity is expected to be greater in the NZE

scenario as the policy focus on initiatives to reduce carbon emissions is higher.

Strategy to realise opportunity

In 2024, we used 32% recycled material in the manufacture of our products. We have a target to

increase this to 36% by 2030 and will develop the feedstock supply chain to support this. This year we

also used a lower-embodied carbon PVC resin (37% below the EU average) in our Modus profile.

The replacement cycle for our extrusion plant allows us to capture production efficiency gains through

use of the latest technology. We continue to invest to improve the efficiency of our existing extrusion

and recycling plants and increase their production yield.

Product design – resource and thermal efficient products TCFD Category: Product and Services, Market

Own operations/

downstream

Increased sales

Medium and long-term

Impact: 1 (Very high)

Likelihood: B (Likely)

Net Rating: Critical

opportunity

Scenario: NZE

Metrics: Scope 3

emissions; revenues

from energy-efficient

products

Opportunity

A growing market for thermally efficient products leading to increased revenue.

Description

Products, which are thermally efficient will reduce consumer energy use, as well as help housebuilders

achieve zero-carbon homes and meet the Future Homes Standard (‘FHS’). Consumer awareness of

home improvement as a means of reducing heating bills is driving demand for earlier replacement of old

windows and other products such as conservatory roofs. Innovative product design is key to continued

revenue growth and also helps to maintain competitive positioning. We focus on improving airtightness,

insulation and energy efficiency, and expect the demand for these products to increase with the adoption

of the FHS (the timing and transition still to be confirmed).

Strategy to realise opportunity

To maximise this opportunity, we will target R&D and marketing spend on low-carbon products and

collaborate with key customers to develop best-in-class, resource and thermally efficient products.

We have a dedicated technical centre focused on product enhancement and development of innovative

new products is a key objective. For example, the Modus triple glazed window significantly reduces heat

loss in houses due to its superior insulation. It also includes more than 50% recycled PVC. In addition,

our new flat rooflight (Luma) has strong thermal insulation characteristics. We expect products such as

these to grow as consumers and housebuilders focus on zero-carbon homes.

TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES

CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 49

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 49

Water and waste savings TCFD Category: Resource Efficiency

Own operations

Decreased costs

Medium-term

Rating: Low

Metrics: Water and

waste costs per

annum; Scope 1 and 2

emissions

Opportunity

Operational cost savings through water and waste reduction.

Water savings

Description

Various opportunities and initiatives exist to reduce water usage across the Group. Our main use of water

is in the extrusion cooling process and in washing of scrap PVC to remove impurities before recycling.

Strategy to realise opportunity

Various initiatives are underway aimed at re-using factory water, including improvements to our closed

loop recycling system, where the water is filtered, purified, and neutralised to maintain its quality.

Thissystem significantly reduces the environmental impact of extrusion processes, by conserving water

resources and reducing levels of contaminated water released into the environment, and also minimises

consumption and disposal costs.

Waste savings

Description

We aim to reduce and recycle general waste products and packaging wherever possible. Packaging

accounts for c.5% of waste generated by Eurocell and there is potential to reduce it. There is also an

opportunity to improve the processing of by-products from our recycling process (metal, rubber, wood)

to enable greater recycling. We have a target to increase waste recycled by 2% per annum from our

2020 baseline (resulting in 88% by 2025), and 1% per annum thereafter (resulting in 93% by 2030).

In2024, 69% of our waste was recycled (2023: 76%). We have also committed to a maximum of 5%

ofwaste to landfill by 2025 and 1% by 2030.

Strategy to realise opportunity

We operate a waste management improvement plan. At third-party sites, which act as a collection and

delivery hub for post-consumer waste windows, we are implementing processes that allow for cleaner waste

streams. We will continue to develop partnerships with waste services providers, to optimise end-to-end

material recovery. We aim to reduce the environmental impact of our packaging through lowering the amount

of packaging used, including thinner packaging, using packaging with more recycled content and eliminating

packaging made from single-use plastics.

Eurocell plc Annual Report and Accounts 202450 Eurocell plc Annual Report and Accounts 202450

Decreasing the amount of energy used and

increasing the amount ofrenewableenergy used TCFD Category: Energy Source

Own operations

Reducing emissions

Medium-term

Impact: 5 (Very low)

Likelihood: A (Almost

certain)

Net Rating: Low

opportunity

Scenario: NZE

Metrics: Energy

consumption; Scope 1

and 2 emissions

Opportunity

Operational cost savings through reduced energy consumption and reduced emissions through using

more renewable energy.

Decreasing the amount of energy used

Description

The Group’s near-term decarbonisation profile includes opportunities for energy efficiency and electricity

savings. With our extrusion, foiling and recycling plants all currently running on electricity, our electricity

consumption accounts for 95% of our energy use.

Strategy to realise opportunity

We continue to drive operational efficiencies, including reducing idle time and optimising temperatures

on extrusion lines and chillers. We have also reviewed the usage of compressed air and smart energy

metering, leading to actionable outcomes to reduce electricity usage. In addition, we are researching

potential methods to reduce the energy intensive foiling process.

Increasing the amount of renewable energy used

Description

There is also an opportunity to further reduce emissions by transitioning to renewable energy contracts

and reduce reliance on the grid through in-house renewable generation.

Strategy to realise opportunity

In 2024, 95% of the Group’s electricity was purchased on renewable contracts and we aim to increase

that further in the years ahead. The 1.1MWp(2) solar panel system installed at our main extrusion facility

became operational in 2024 (lifetime CO

e saving of c.3,500t), and the project to add solar panels at our

main distribution centre will start shortly.

Transportation TCFD Category: Resource Efficiency

Own operations/

upstream/downstream

Decreased costs

Long-term

Impact: 4 (Low)

Likelihood: A (Almost

certain)

Net Rating: Medium

opportunity

Scenario: NZE

Metrics: Scope 1 and

3 emissions (Upstream

and Downstream

Transportation and

Distribution)

Opportunity

Cost savings, decreased carbon emissions and decreased exposure to carbon prices through

decarbonisation of fleet vehicles.

Description

Decarbonisation of our third-party distribution fleet and company vehicles is a significant opportunity

to reduce emissions. This may require additional investment over the medium term to transition and

upgrade vehicles. Additionally, further technological development is required for zero emissions heavy

goods vehicles to become viable e.g. either via electric vehicles or the potential use of hydrogen or

other biofuels (‘HVO’) as an alternative fuel source.

Strategy to realise opportunity

Company vehicles

In 2024 we continued to upgrade our warehouse material handling plant with electric alternatives, as

existing plant lease agreements expire. In addition, we expect to install a telemetric system in our branch

network vehicles to improve the efficiency of route planning and load maximisation. We will continue to

explore options to progressively convert other company vehicles to electric and increase EV charging

infrastructure at branches.

Third-party distribution

We will work with our third-party logistic supplier to use software to improve route efficiency. We will also

engage with them to better understand the potential for decarbonisation of our commercial distribution

fleet, including a switch to HVO fuels. Whilst this would further reduce our Scope 3 upstream and

downstream transportation and distribution emissions, the bulk of this reduction would likely only take

place in the medium term.

Key opportunities continued

TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES

CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 51

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 51

Metrics and targets

Climate-related metrics

We report our full carbon footprint

covering Scope 1, 2 and 3 greenhouse

gas emissions. However, this work is

based on a number of management

estimates and we expect more variation in

the coming years as we continue to refine

our methodology. This year, for example,

we conducted a colleague commuting

survey and engaged with suppliers to

capture more accurate data to underpin

our Category 1 and Category 7

emissions respectively.

The specific metrics we use to

monitoreach of the climate-related

riskand opportunities are noted in

the previous tables.

Additional environmental metrics we

monitor include recycled materials used

in production and emissions saved as

a result, emissions intensity, energy

and renewable energy use and waste

generation, as reported on page 24.

Climate-related targets

We are committed to being a responsible

business and working to minimise our

impact on climate change and, as set

out in the Sustainability Report on pages

22 to 39, in 2024 we continued working

towards reducing our Scope 1, 2 and 3

greenhouse gas emissions.

We have committed to achieve Net Zero

on our emissions by 2045, with an interim

target in 2034, by which time we need to

reduce Scope 1 and 2 emissions by 70%

and Scope 3 emissions by 38%, both from

a 2022 base year. Our Net Zero Transition

Plan outlines how the targets will be met,

and the critical factors we are dependent

on to achieve this, including the availability

of commercially low-carbon alternatives

to virgin PVC resin and supplier

decarbonisation.

Our emissions and energy reduction

targets have been adopted as the most

relevant to our climate-related risks,

particularly relating to carbon pricing

risks, and in order to directly manage our

contribution to mitigating global climate

change. Progress against these targets

will be monitored and reviewed by the

Board through the governance structures

described earlier in this TCFD Report.

Eurocell plc Annual Report and Accounts 202452 Eurocell plc Annual Report and Accounts 202452

CHIEF FINANCIAL

OFFICER’S REVIEW

Group

2024

£m

2023

£m

Revenue 357.9 364.5

Gross profit 188.3 173.8

Gross margin (%) 52.6% 47.7%

Overheads (140.2) (130.7)

Adjusted

EBITDA 48.1 43.1

Depreciation and amortisation (25.3) (24.7)

Adjusted

operating profit 22.8 18.4

Finance costs (2.8) (3.2)

Adjusted

profit before tax 20.0 15.2

Taxation (4.6) (2.9)

Adjusted

profit after tax 15.4 12.3

Adjusted

basic earnings per share (pence) 14.4 11.0

Non-underlying overheads (6.2) (3.5)

Tax on non-underlying items 1.3 0.8

Reported operating profit 16.6 14.9

Reported profit before tax 13.8 11.7

Reported profit after tax and profit for the year 10.5 9.6

Reported basic earnings per share (pence) 9.8 8.6

1 See alternative performance measures.

The Group has a strong balance sheet

and good liquidity, which underpinned

funding the acquisition of Alunet in March

2025, primarily from our existing debt

facility. Alunet is an excellent strategic

fit for Eurocell and is expected to

support a step change in the Group’s

financial performance.

The encouraging early progress we have

made with execution of our strategy,

including the recent acquisition of Alunet,

together with actions we continue to

take on cost and cash flow strengthen

our confidence in realising our ambitions,

and we remain well positioned to take

advantage of a recovery in our end

markets, when it comes.

Revenue

Group revenue for 2024 was £357.9million,

2% lower than 2023 (£364.5million),

with volumes down 1%. Sales include

the impact of selling price increases,

but average sales pricing in the branch

network remains lower than prior year

(seeGross margin to the right and

Divisional Performance overleaf).

Gross margin

Gross margin for the year was 52.6%, up

from 47.7% in 2023. Although increased

competition for limited demand continues

to drive pressure on selling prices in the

branch network, we have benefited from

a reduction in input cost pricing, including

electricity, recycling feedstock, and PVC

resin prices.

We operate a rolling 12-month forward

hedging policy for electricity. In 2023 we

were paying rates locked in during 2022,

when wholesale prices peaked. We are

now benefiting from the lower wholesale

prices experienced in 2023.

For our recycling business, in 2023 a

weaker RMI market and fewer window

replacements restricted feedstock

availability, resulting in a significant

increase in purchase prices. However,

we have made good progress securing

additional sources of feedstock, which,

alongside reduced demand and lower

virgin resin prices, saw prices ease

in2024.

Whilst there are only a limited number

of PVC resin and certain other key raw

material suppliers, we have successfully

identified alternative sources and

introduced other initiatives to mitigate

inputcost pricing risk.

Introduction

Market conditions remained challenging

throughout 2024, resulting in sales modestly

below the comparative period. However, we

have proactively managed our gross margin,

with lower input costs also driving 2024

profits ahead of 2023, despite labour inflation

and investment in the cost base to generate

momentum in our strategic initiatives.

The Group has assessed the impact of

the employers’ National Insurance and

National Living Wage changes announced

in the Autumn Budget, which take effect

from April 2025. We estimate additional

costs of c.£3million per annum, which

we plan to offset through selling price

increases and other management actions,

including cost reduction.

We continue to focus on efficient working

capital management and delivered solid

cash flow generation for the year. Having

completed a £15million share buyback

programme launched in January 2024,

debt remains low.

Strategic Report Financial StatementsCorporate Governance

Michael Scott

Chief Financial Officer

Distribution costs and

administrative expenses (overheads)

Underlying overheads were £140.2million,

up 7% on 2023 (£130.7million). We have

continued to experience cost inflation,

particularly for labour, which we have offset

with selling price increases. Overheads also

include investment to generate momentum

in our strategic initiatives (seeDivisional

Performance overleaf). These increases

were partially offset by the annualisation

of cost savings secured through our Q2

2023 restructuring and headcount

reduction programme.

Depreciation and amortisation

Depreciation and amortisation was

£25.3million compared to £24.7million

in2023.

Alternative performance measures

Alternative performance measures are used

alongside statutory measures to facilitate a

better understanding of financial performance

and comparison with prior periods, and in

order to provide audited financial information

against which the Group’s bank covenants,

which are all measured on a pre-IFRS 16

basis, can be assessed.

Adjusted EBITDA, adjusted operating profit

and adjusted profit before tax all exclude

non-underlying items. Adjusted profit

after tax and adjusted earnings per share

exclude non-underlying items and the

related tax effect. Pre-IFRS 16 EBITDA is

stated inclusive of operating lease rentals

under IAS 17 Leases. Pre-IFRS 16 net debt

is defined as total borrowings and lease

liabilities less cash and cash equivalents,

excluding the impact of IFRS 16 Leases.

We classify some material items of income

and expense as non-underlying when the

nature of the circumstances merit separate

presentation. Alongside statutory measures,

this facilitates a better understanding of

financial performance and comparison with

prior periods.

We continue to focus on

efficient working capital

management and delivered

solid cash flow generation

for the year.”

53Eurocell plc Annual Report and Accounts 2024

Eurocell plc Annual Report and Accounts 202454 Eurocell plc Annual Report and Accounts 202454

CHIEF FINANCIAL OFFICER’S REVIEW CONTINUED

Non-underlying items

Non-underlying items for 2024 of

£6.2million include £2.2 million of strategic

IT project costs, including cloud computing

costs involving ‘Software as a Service’

arrangements and internal resourcing costs

(see below), which are expensed as incurred

rather than being capitalised as intangible

assets, a £3.2 million non-cash right-of-use

asset impairment charge plus £0.8 million of

acquisition costs in relation to Alunet.

Non-underlying items of £3.5 million

in 2023 include restructuring costs of

£2.7million, comprising redundancy

payments and related employee benefit

termination costs in connection with our

Q2 2023 restructuring, plus £0.8million

ofstrategic IT project costs.

Our strategic IT projects comprise a

new customer-facing website and an

employee management system (both

now substantially complete) and, most

significantly, the replacement of our

Enterprise Resource Planning (‘ERP’)

system. The expected cost of the

system replacement is in the region of

£10million over the 2024-26 period.

The implementation is on track and,

as previously reported, we estimate

the transition will be completed around

mid-2026.

The right-of-use asset impairment charge

arises following a dispute with the landlord

at a secondary warehouse in Derbyshire,

where there was significant deterioration

to the flooring.

Following legal advice, weterminated

the lease. The landlord has contested

the termination and issued proceedings

for unpaid rent. We will shortly begin a

mediation process, with the potential

for a court case to follow. Withthe site

not currently in condition for use and

the outcome of the dispute uncertain,

the lease asset has been impaired in full.

The liability for future rentals(£3.1million),

remains on the balance sheet.

The impairment may be reversed in

future periods, or the liability released,

depending on the outcome ofthe dispute.

Profiles third-party revenue for the year was £146.1million, 6% lower than 2023,

reflecting reduced RMI activity and a continuing weak new build housing market.

Cost-of-living pressures, interest rate increases and falling house prices have all

hadasignificant adverse effect on our end markets.

Divisional performance – Profiles

2024

£m

2023

£m

Change

Third-party revenue 14 6.1 154.9 (6)%

Inter-segmental revenue 63.7 64.9 (2)%

Total revenue 209.8 219.8 (5)%

Adjusted

operating profit 19.4 11.9 63%

Operating profit 14.6 10.1 45%

1 Adjusted performance measures are stated before non-underlying items.

Profiles adjusted operating profit for

2024 of £19.4million was 63% above

2023, reflecting lower raw material and

electricity costs, partially offset by lower

sales volumes plus labour and other

costinflation.

Reported operating profit is stated after

non-underlying costs of £4.8million in

2024 (strategic IT projects, a non-cash

right-of-use asset impairment charge and

acquisition expenses) and £1.8million in

2023 (restructuring costs).

Third-party revenues in the Branch Network were £211.8million, 1% higher than 2023.

Although general RMI volumes in the branch network were down, overall sales were up

on 2023, reflecting the initial benefits of progress with our strategic initiatives for garden

rooms, windows, doors and e-commerce activity.

Branch Network adjusted operating profit

for 2024 was £6.5million, 27% below

2023, reflecting competitive pressure on

selling prices in the branches and higher

overheads, which include labour and other

cost inflation. Overheads also include

investment to generate momentum in our

strategic initiatives, such as marketing

(pay-per-click), sales professionals and

central order processing capability, and

we expect to leverage this investment and

improve margins as volumes grow.

Reported operating profit is stated after

non-underlying costs of £1.4million in 2024

(strategic IT projects) and £0.7million in

2023 (restructuring costs).

Divisional performance – Branch Network

2024

£m

2023

£m

Change

Third-party revenue 211. 8 209.6 1%

Inter-segmental revenue 0.5 0.4 25%

Total revenue 212.3 210.0 1%

Adjusted

operating profit 6.5 8.9 (27)%

Operating profit 5.1 8.2 (38)%

1 Adjusted performance measures are stated before non-underlying items.

Finance costs and taxation

Finance costs for 2024 were £2.8million

(2023: £3.2million).

The underlying tax charge for 2024 was

£4.6million (2023: £2.9million).

The total tax charge for 2024 was

£3.3million (2023: £2.1million).

The effective tax rate on underlying profit

before tax for 2024 of 23.0% is lower

than the standard rate of corporation

tax of 25% due to Patent Box relief.

We were pleased to retain the Fair Tax

Mark accreditation in 2024, reflecting our

commitment to paying the right amount

of tax at the right time.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 55

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 55

Profit before tax and earnings

pershare

Adjusted profit before tax for the year was

£20.0million compared to £15.2million

in 2023, up £4.8million, driven by lower

input costs, partially offset by the effect

of lower volumes, margin pressure in the

branches and higher overheads.

Reported profit before tax in 2024 was

£13.8million (2023: £11.7million),

reflecting the above less £6.2million of

non-underlying costs (2023: £3.5million).

Adjusted basic earnings per share were

14.4 pence and diluted earnings per share

for the year were 14.3 pence (2023: both

11.0 pence). Total basic earnings per

share were 9.8 pence and total diluted

earnings per share were 9.7 pence

(2023:both 8.6 pence).

Capital allocation, dividends

and share buyback programme

As set out in the Chair’s Statement, the Board

is committed to driving shareholder returns

through a combination of a progressive

ordinary dividend and supplementary

distributions (currently via share buybacks)

where appropriate, whilst always seeking

to maintain a strong financial position.

We paid an interim dividend of 2.2 pence per

share in October 2024. The Board proposes

a final dividend of 3.9 pence per share,

which results in total dividends for the year

of 6.1 pence per share (£6.3million), up 10%

compared to 2023. Thedividend will be paid

on 23 May 2025 to shareholders registered

at the close of business on 25 April 2025.

The ex-dividend date will be 24 April 2025.

The £15million share buyback programme

which commenced in January2024

is now complete, with 10.7 million

shares repurchased. At 31 December

2024, 10.3million shares had been

repurchasedfor £14.5million (including

transaction costs), with 1.3 million shares

held in treasury.

The Board has taken the decision to

launch a new share buyback of up to

£5million.

The retained earnings of Eurocell plc as

at 31 December 2024 were £41.2million

(2023: £25.0million). The Company takes

steps to ensure distributable reserves are

maintained at an appropriate level through

intra-Group dividend flows.

Capital expenditure

Capital expenditure for 2024 of £10.7million

(2023: £8.9million) is largely maintenance

in nature.

Cash flow

Net cash generated from operating

activities was £44.2million (2023:

£52.8million), including a net outflow from

working capital of £0.2million, comprised

of increases in inventories (£0.5million),

receivables (£3.4million) and payables

(£3.7million). This compares to a net

inflow from working capital of £13.4million

in 2023, which included a major stock

reduction programme. Net cash generated

from operating activities also includes

net tax paid in the year of £3.0million

(2023:£1.4million).

Other cash flow items include payments

for capital investments of £10.3million

(2023: £9.1million), including the

net movement on capital creditors of

£0.4million and financing costs paid of

£0.7million (2023: £1.4million).

The principal elements of lease payments

of £14.4million (2023: £13.8million) are

presented within cash flows arising from

financing activities. The finance elements

of lease payments were £2.1million

(2023:£1.8million).

Dividends paid in the year were

£6.1 million, being the 2023 final

and 2024interim payments

(2023dividendspaid: £10.3million).

Net cash/debt

Net debt on a pre-IFRS 16 basis at

31December 2024 was £3.1million

(31December 2023: net cash of

£0.4million). Lease liabilities increased

by £0.8million. Reported net debt at

31December 2024 was £62.5million

(31December 2023: £58.2million).

2024

£m

2023

£m

Change

£m

Cash 0.4 0.4 –

Bank overdrafts (3.0) – (3.0)

Borrowings (0.5) – (0.5)

Net cash/

(debt)

(pre-IFRS 16)

(3.1) 0.4 (3.5)

Lease liabilities (59.4) (58.6) (0.8)

Net debt

(reported)

(62.5) (58.2) (4.3)

Acquisition of Alunet

In March 2025, we announced the

acquisition of Alunet for consideration

of £29million on a debt/cash free

basis, comprising an initial payment of

£22million and deferred consideration of

approximately £7million payable in four

annual instalments beginning in 2026.

In addition, there is the potential for

performance-related payments of up to

£6m over the same period. The initial and

deferred consideration of approximately

£29million represents a multiple of 6.5x

Alunet’s EBITDA for the year ended

31December 2024.

Additional contingent consideration may

become payable, subject to an earnout

mechanism, in four annual instalments

beginning in 2026, based upon the

EBITDA of Alunet in the preceding

calendar year. The maximum of £6million,

if achieved, would result in a total

consideration of £35million, representing a

multiple of c.4x Alunet’s projected EBITDA

for the year ended 31 December 2028.

Approximately £1million of the initial

consideration is in the form of ordinary

shares in Eurocell plc and satisfied out of

shares held in treasury, with the remainder

payable in cash, funded from the Group’s

existing £75million revolving credit facility.

The acquisition is expected to be accretive

to the Group’s underlying earnings for

2025, and pro forma net debt is expected

to be below 1.0x pre-IFRS 16 EBITDA at

31December 2025.

Bank facility

Our activities are funded via our £75million

unsecured, sustainable Revolving Credit

Facility, which matures in 2027. The

facility is provided by Barclays, NatWest

and Bank of Ireland, and is competitively

priced. In terms of sustainability, modest

adjustments to the margin are applied

based on our achievement against annual

targets for usage of recycled material in

our products, waste recycled and carbon

emissions. We operate comfortably within

the terms of the facility and in compliance

with our financial covenants, which are

measured on a pre-IFRS 16 basis.

Michael Scott

Chief Financial Officer

Eurocell plc Annual Report and Accounts 202456 Eurocell plc Annual Report and Accounts 202456

RISK MANAGEMENT

Approach to risk management

The Board is responsible for setting the risk

appetite, establishing a culture of effective

risk management and for ensuring that

effective systems and controls are in place

and maintained.

Senior managers take ownership of specific

risks and implement policies and procedures

to mitigate exposure to those risks.

Risk management process

The risk management process sits

alongside our strong governance culture

and effective internal controls to provide

assurance to the Board that risks are being

appropriately identified and managed.

How we manage risk

Risk is managed across the Group in the

following ways:

• The Board meets annually to review

strategy and set the risk appetite

• Risks faced by the Group are identified

during the formulation of the annual

business plan and budget process,

which sets objectives and agrees

initiatives to achieve the Group’s goals,

taking account of the risk appetite set

bythe Board

• Senior management and risk owners

consider the root cause of each risk and

assess the impact and likelihood of it

materialising. The analysis is documented

in a risk register, which identifies the level

of severity and probability, ownership,

and mitigation measures, as well as any

proposed further actions (and timescale

for completion) for each significant risk

• The Group’s Executive Committee is

also the Risk Management Committee.

This Committee meets on a regular

basis (usually monthly). The status of the

most significant risks and mitigations are

reviewed at each meeting, with other

risks reviewed at least bi-annually

• The Executive Directors also meet with

senior managers on a regular basis

throughout the year. This allows the

Executive Directors to ensure that they

maintain visibility over the material aspects

of strategic, financial and other risks

• The Group’s Audit and Risk Committee

assists the Board in assessing and

monitoring risk management across

the Group. The role of the Committee

includes ensuring the timely identification

and robust management of inherent

and emerging risks, by reviewing the

suitability and effectiveness of risk

management processes and controls.

The Committee also reviews the risk

further actions are together consistent

with the risk appetite set by the Board.

Internal control

The Group has well-defined internal control

systems and processes.

Key financial controls include monthly

balance sheet reconciliations, daily

perpetual inventory counts and automated

three-way matching for purchases.

Key IT controls include cyber security

awareness campaigns and continuous

employee training programmes, multi-

factor authentication and privileged access

management. Key operating controls

include standard operating procedures

in place across all manufacturing and

warehouse operations, which are tested,

reviewed and approved on an annual

basis and are fully compliant with the

requirements of ISO 14001.

The Group has a robust process of

financial planning and monitoring,

which incorporates Board approval

of operating and capital expenditure

budgets. Performance against the budget

is subsequently monitored and reported

to the Board monthly. The Board also

monitors overall performance against

operating, safety and other targets set

atthe start of the year.

Performance is reported formally to

shareholders through the publication

of results both annually and half-yearly.

Operational management regularly reports

on performance to the Executive Directors.

Day-to-day operations are supported

by aclear schedule of authority limits

that define processes and procedures

for approving material decisions. This

ensures that projects and transactions

are approvedat the appropriate level

of management, with the largest and

mostcomplex projects being approved

bythe Board.

Risk management is the responsibility of the Board and is

key to delivering the Group’s strategic objectives.

Identify risks

Quantify net risk

Identify any further

action required

Assess gross risk

Identify existing mitigation

Monitor

and control

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 57

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 57

The schedule of authority limits is reviewed

on a regular basis so that it matches the

needs of the business.

The Group also has processes in place

for ensuring business continuity and

emergency planning.

Internal Audit

In order to further enhance the internal

control and risk management processes,

KPMG provides an outsourced internal

audit service to the Group. KPMG work

closely with the Risk Management

Committee in delivering the Group’s

internal audit programme. Other third-party

experts are also engaged to provide

internal audit reviews where appropriate

e.g. cyber security.

Strategic risk register

The Group maintains a risk register

that identifies key and emerging risks,

the probability of those risks occurring

and theimpact they would have on

the Group if unmitigated. Against each

gross risk, thecontrols that exist to

manage and, where possible, minimise

oreliminate those risks are also listed,

and an assessment of net risk is

provided.Therisk register also identifies

any further actions required such that

netresidual risk is consistent with the

riskappetite set by the Board. The register

is regularly updated to reflect changes

incircumstances.

The Group is subject to a wide variety of

risks and it is not practical to set out all

risks that the Board are actively managing

here. Principal risks are those risks, which

are identified as having a potentially

material impact on the Group’s operations,

achievement of its strategic objectives,

or viability to continue as a going concern.

The actions taken to mitigate these risks

cannot provide absolute assurance that

they will not materialise, but will either

mitigate the impact or reduce the likelihood

to a level aligned to the Board’s risk

appetite. For each of the principal risks,

the following table includes a description

of the risk and how it may impact the

Group, as well as the mitigations currently

in place and any significant change in the

risk in the year.

Macroeconomic and market conditions

Cyber security

Health and safety

Supply chain risk

Sustainability and climate change

Managing change

ERP systems implementation

Operational and regulatory compliance risk

Principal risks

Low

Medium High

Probability

Low Medium

High

Impact

01 02

03 04 05

06 07

Eurocell plc Annual Report and Accounts 202458 Eurocell plc Annual Report and Accounts 202458

PRINCIPAL RISKS

AND UNCERTAINTIES

Principal risk description and impact

Strategic

priorities Mitigation Movement

Macroeconomic and market conditions

Our products are used in the residential and commercial

building and construction markets, both within the RMI

sector, for new residential housing developments and

for new construction projects.

Our private RMI business is strongly correlated to the

level of household disposable incomes. Our new build

business is particularly influenced by the level of activity

in the house building industry.

A weakening in macro or market conditions can have

a significant impact on the financial performance of the

Group. Government economic and social policy, and

the level of interest rates, can also have a significant

impact on our business.

Trading conditions in our key markets have remained

subdued in 2024, with challenging macroeconomic

conditions and weak consumer confidence further

compounded by uncertainty following the Autumn

Budget and persistently high interest rates. As a result,

many expert market analysts now predict a recovery

in the UK economy will take place later than had

been anticipated.

Specific market conditions can also impact upon the

demand for our products, for example a competitor

seeking additional market share through short-term

price reductions.

• Notwithstanding macro conditions, we

expect our five-year strategy, launched at the

beginning of 2024, to support sales and profit

growth and drive good cash conversion

• Strategic initiatives include the optimisation

and expansion of the branch network, an

enhanced customer proposition, simplified

business structures, plus targeted continuous

operational improvements and cost efficiencies

• Good progress made with the early stages of

the strategy in 2024

• The recent acquisition of Alunet advances our

strategy by addressing a growing trend towards

aluminium fabrication across the fenestration

sector, significantly strengthening the Group’s

position in residential aluminium systems and

composite doors

• Proactively managing our cost base, including

restructuring the branch network in Q1 2025

• We operate comfortably within the terms of our

bank facility and related financial covenants.

Cyber security

A breach of IT security (externally or internally) could

result in an inability to operate systems effectively

(e.g.viruses) or the release of inappropriate information

(e.g. hackers). Sophisticated phishing attacks are

increasing in both frequency and complexity.

A breach of cyber security could have a significant

impact on the reputation of the business as well as the

resulting fines impacting the financial performance.

The Group experienced a cyber incident in July 2022,

causing significant disruption to our operations.

The Group has subsequently further strengthened

its cyber defences, but this remains a fast-evolving

threat and continues to receive considerable

management attention.

• Ongoing investment in cyber risk detection

and prevention tools

• These measures include managed detection

and response (‘MDR’), security instant

event monitoring (‘SIEM’), privileged access

management (‘PAM’) and firewall hardening

• Physical security of servers at third-party off-site

data centre, with full disaster recovery capability

• Password and safe-use policies in place,

internet usage monitored and anti-malware used

• External cyber review and internal audit

reviews conducted periodically, resulting in

enhancements in defences

• Cyber awareness/IT security campaign active

for all employees

• Financial crime protection and cyber liability

insurance in place.

Movement key: Increase No change Decrease

Strategic priorities key: Customer growth Business effectiveness People first ESG leadership

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 59

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 59

Principal risk description and impact

Strategic

priorities Mitigation Movement

Health and safety

The Group’s production, manufacturing and distribution

operations are carried out under potentially hazardous

conditions. It is essential that safe environments are

created and maintained for all employees and other

stakeholders that access our facilities, and that the

Group complies with all relevant laws and regulations.

A deterioration in our health and safety performance

statistics, including increased or more serious injuries,

or a breach of health and safety regulations could lead

to significant financial and reputational damage to the

business, as well as harm to our employees.

• Three-year health and safety strategy launched

in 2022, with implementation progressing well

and driving improvements in safety performance

• Procedures and policies in place to support

compliance with all relevant regulations

• Regular communication and training on

policy compliance

• Monitoring procedures in place, including near

miss and potential hazard reporting for health

& safety matters

• Internal and third-party site audits to assess

compliance with our policies.

Supply chain risk

Our manufacturing and recycling operations rely on the

supply of several core raw materials, and our branch

network relies on the supply of third-party products.

In terms of supply, there are only a limited number of

PVC resin and certain other raw material suppliers,

impacting both the supply and price of these materials.

Further, we have a limited capacity to store such

materials at our sites. Failure to procure raw materials on

a timely basis could impact on our ability to manufacture

products and meet customer demand.

On pricing, several raw materials are priced in US Dollars

and Euros, and therefore although we pay in Sterling,

we are impacted by international currency markets.

Availability of recycling feedstock is limited, and

dependent upon the level of RMI activity in the UK.

The level of RMI activity can therefore significantly impact

both the price and availability of recycling feedstock.

Further, many of our key raw materials and third-party

products are transported to the UK from the EU, and to

a lesser extent, the US and the Far East, and therefore

the capacity of global shipping can also impact both the

availability and price of key materials.

Increasing costs could have a negative impact on the

financial performance of the business. An inability

to source the required materials could also impact

financially, as well as upon the reputation of the business

if we are unable to meet sales demand.

• Initiatives to improve supply chain resilience,

including sourcing alternative/more local sources

of key raw materials and third-party products

• Procurement strategy in place to secure

newsupply lines for recycling feedstock

(i.e.post-consumer and post-industrial waste),

on a contractual basis where possible

• We agree fixed-price contracts with key

suppliers to mitigate the risk of input cost

increases where possible and economic

• Although we do not hedge currency, we agree

pricing in GBP to mitigate exchange rate

volatility where possible and economic

• All new suppliers are now required to complete

a cyber risk questionnaire, and regular reviews

are conducted to test the financial stability of

key suppliers.

Eurocell plc Annual Report and Accounts 202460 Eurocell plc Annual Report and Accounts 202460

PRINCIPAL RISKS AND UNCERTAINTIES CONTINUED

Principal risk description and impact

Strategic

priorities Mitigation Movement

Sustainability and climate change

Demonstrating improving business sustainability is

becoming increasingly important to all stakeholders.

Failure to improve in all material aspects of ESG

(environmental, social, governance) could lead

to regulatory and other challenges e.g. colleague

recruitment and retention.

If we do not deliver on our environmental targets and

establish a credible pathway to carbon neutrality and

Net Zero, investors and lenders may show a preference

to allocate capital to businesses with better understood

climate impacts and a clear plan to improve.

There are physical risks associated with climate change.

The Group operates from over 200 locations, and with a

changing climate there is an elevated risk that elements

of our operations could be impacted by fire, flooding or

other environmental issues.

• Strong underlying position on sustainability

underpinned by window recycling operation,

which drives significant carbon savings

compared to the use of virgin PVC resin

• Regular environmental risk assessments are

conducted at existing and potential sites.

Risks are managed through local business

continuity plans. Risk assessments are

enhanced by using a physical risk analysis

software tool

• Expert third-party support provided by CEN

Group, a specialist ESG consultancy

• Significant work done in 2023 and

2024including:

– Materiality assessment to determine the

most important sustainability topics to

the business

– Baseline carbon footprint (Scope 1, 2 and

3), identifying key decarbonisation levers

– Using the above outputs to define

ESGobjectives and develop a

sustainability strategy

– Confirmed Net Zero target date of 2045,

submitted targets to SBTi and published

our Transition Plan.

• Governance and oversight provided by the

ESG and Social Values Board Committee.

Movement key: Increase No change Decrease

Strategic priorities key: Customer growth Business effectiveness People first ESG leadership

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 61

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 61

Principal risk description and impact

Strategic

priorities Mitigation Movement

Managing change

The Group has been through a period of significant

organisational change over the past two years, including

the appointment of new Non-executive Directors and a

new Chief Executive.

At the beginning of 2024, the Group launched a five-year

strategy, which identifies a clear path to organic growth

and improved operating margins, based on new

commercial and operational initiatives.

The strategy also includes simplification of business

processes and systems. As detailed below, we have

embarked upon a complex multi-year project to replace

our Enterprise Resource Planning (‘ERP’) system.

Embracing and effectively managing change is fundamental

to delivery of the strategy and the Group’s future success.

There is a risk that the pace and extent of change puts

the resources and bandwidth of the organisation under

strain, leading either to a failure to deliver the strategy

or implement the new ERP system, which could have

significant financial and operational implications.

Component risks include the ability to attract, retain

and recruit the right calibre of senior managers with the

required skills and experience, in particular the technical

ability to execute a complex IT implementation, and

the risk that our various stakeholders do not respond

positively to our new strategy.

• Experienced Board with significant,

relevant experience in delivering effective

change programmes

• Five-year strategy communicated to all

stakeholders has been well received

• Good progress with the early stages of the

strategy in 2024

• Experienced Director of IT and internal team

in place with good experience of complex

IT implementations

• People First strategic pillar objective to make

Eurocell a great place to work, through a

focus on health and safety, an enhanced

employee value proposition, improved levels of

engagement and effective talent management

• Developing a successful track record and

clear strategic direction provides an attractive

backdrop to joining the senior team at Eurocell

• Market rate compensation for all personnel,

including leadership team

• Revised equity-based long-term incentive

plan for senior team to be proposed at 2025

AGM, with attractive rewards directly linked

to achievement of the strategy.

Eurocell plc Annual Report and Accounts 202462 Eurocell plc Annual Report and Accounts 202462

PRINCIPAL RISKS AND UNCERTAINTIES CONTINUED

Movement key: Increase No change Decrease

Strategic priorities key: Customer growth Business effectiveness People first ESG leadership

Principal risk description and impact

Strategic

priorities Mitigation Movement

ERP systems implementation

The group relies on its SAP Enterprise Resource Planning

(‘ERP’) system for all aspects of its operations. However,

we concluded that the age profile of our SAP system

had become a limiting factor in the development of the

business. In addition, the current SAP system becomes

unsupported in 2027. We therefore began a major project

to replace SAP.

The successful implementation of a new system is

critical to the long-term prospects of the business.

It is a complex process, consuming significant time

and resource. The major components are:

• a front-end trading system to support the branch

network (Intact iQ);

• a back-end ERP System to support all other functions

of the business, including manufacturing, recycling,

warehousing, distribution and finance (IFS Cloud); and

• an integration platform to knit the new systems together.

The project is on track, with Intact iQ now in testing

phase and IFS in build phase.

In total, we anticipate transition to the new systems

around mid-2026, and we estimate the total costs of the

project will be in the region of £10million over thisperiod.

• Experienced Director of IT and internal team

in place with good experience of complex

IT implementations

• Significant incremental resource now assigned

to the project

• Third-party expert consulting firm in place

to oversee and advise on the project

• Board-led Steering Group in place to

monitorprogress

• Comprehensive project plan and governance

processes in place and reviewed by KPMG

internal audit in 2024, with recommendations

now substantially implemented

• Intact iQ has a strong reputation within our

sector, with a specialism in delivering electronic

point-of-sale solutions to multi-site building

product distributors

• IFS is a market-leading product and we are

implementing on an ‘out of the box’ basis to

maximise standardisation and automation.

Operational and regulatory compliance risk

The business is dependent on the continued and

uninterrupted performance of our production facilities.

Each of the facilities is subject to operating risks,

such as: industrial accidents (including fire); extended

power outages; withdrawal of permits and licences

(e.g. the regulated operation of the recycling facility);

breakdowns in machinery or information systems; and

other unforeseen events.

The inability to manufacture or deliver goods would have

a significant financial and reputational impact.

We may also be adversely affected by the crystallisation

of unexpected corporate, legal or regulatory risks,

for example future REACH (registration, evaluation,

authorisation and restriction of chemicals). In

addition, HR/employment legislation is becoming

increasinglycomplex.

Failure to comply with relevant laws and regulations

could result in significant fines and reputational damage.

• Regular planned maintenance to reduce the

risk of plant failure, including maintenance

capital investment of >£5million per annum

across the Group

• Business continuity plans in place for all major

sites and the branch network, which are

testedperiodically

• Procedures and policies in place to support

compliance with all relevant laws and regulations

• Regular communication and training on

policy compliance

• An ongoing dialogue on emerging employment

law with our advisers.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 63

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 63

As required by section 4 of the UK Corporate Governance Code,

the Directors have taken into account forecasts to assess the

future funding requirements of the Group, and compared them

with the level of committed available borrowing facilities.

VIABILITY STATEMENT

A period of three years has been adopted

as this is the key time frame used by the

Board within our strategic and planning

horizon. This is also consistent with the

Group's five-year strategy, where the later

years represent the growth to maturity

of strategic initiatives commenced in

the first three years. The assessment of

viability has been made with reference

to the Group’s current position and

long-term future prospects, our strategy,

management of risk, and also the

Board’s assessment of the outlook in the

marketplace, all of which are covered in

detail within the Strategic Report.

The Board considers its strategy and risks

on strategy away-days, and revisits these

annually when considering the next year’s

budget. The three-year plan considers

revenue and earnings growth and how

this impacts on cash flows and key ratios.

Operational plans and financing options

are considered as part of this process.

In preparing the plan, we adopt a prudent

forecast in respect of organic sales growth,

but assume other initiatives, in line with the

published strategy.

The plan is stress tested by applying the

following plausible downside scenarios,

which have been chosen as they are

representative of the potential impact of

the Group's principal risks:

Scenario 1

Macroeconomic conditions lead

to a decline in sales

(Macroeconomic and market

conditions risk)

A 10% decrease in revenues has been

applied over the three-year plan period.

Scenario 2

Commodity prices and/or

exchange rates or raw material

shortages lead to a sustained

increase in resin prices

(Supply chain risk)

A 33% increase in resin costs has been

applied over the three-year plan period.

Scenario 3

Scenario 1 and 2 combined

There is a possibility that both of the above

scenarios could materialise at the same

time, therefore we have assessed the

combined impact through the three-year

plan period.

The Board considers these tests to be

sufficient to test the viability of the Group

given our size and the markets we operate

within. As described in Principal Risks and

Uncertainties above, we have measures in

place to help mitigate the impact of these

events should they occur.

The Group has a £75million Revolving

Credit Facility. Monthly cash flow

projections show significant headroom

throughout the period to December 2027.

The facility includes standard covenants

for leverage and interest cover, which are

measured twice per annum, at June and

December. The projections also show

good headroom on the covenants at each

measurement date to December 2027.

The Directors confirm that we have a

reasonable expectation that the Company

and the Group will continue in operation

and meet our liabilities as they fall due in

the next three years.

Going concern

The Directors have reviewed the

Company’s and the Group’s forecast

and projections, which demonstrate that

the Company and the Group will have

sufficient headroom on our bank facilities,

which expire in May 2027 but are likely

to be refinanced on similar terms within

this time frame, and that the likelihood of

breaching the related covenants in this

period is remote.

Accordingly, the Directors continue to

adopt the going concern basis in preparing

the Annual Financial Statements.

This Strategic Report was approved by the

Board on 19 March 2025 and signed on

its behalf by:

Darren Waters

Chief Executive

Michael Scott

Chief Financial Officer

Eurocell plc Annual Report and Accounts 202464

Derek Mapp

Non-executive Chair

Date of appointment:

16 May 2022

(Chair from 1July 2022)

Darren Waters

Chief Executive

Date of appointment:

11 April 2023

(Chief Executive from 11 May 2023)

Michael Scott

Chief Financial Officer

Date of appointment:

1 September 2016

Experience:

Derek is an experienced chair and has a wealth

of commercial and operational knowledge.

Previously, he was Chair of Informa plc from

March 2008 until his retirement in June 2021

and was also Chair of Huntsworth plc from

December 2014 to March 2019. Prior to that,

Derek was Chief Executive Officer of

Tom Cobleigh plc, Executive Chair of

Leapfrog Day Nurseries Limited, Chair of East

Midlands Development Agency and Sport

England, and also served on a number of

government agencies and boards.

Experience:

Darren joined the Group in April 2023 as

Chief Executive Designate and was appointed

as Chief Executive on 11 May 2023.

He was formerly Chief Operating Officer for

Ibstock plc and has extensive experience

and knowledge of the building products and

fenestration sectors in the UK. Prior to this,

Darren was the Chief Executive for Tyman plc

(UK and Ireland) for nine years and previously

held senior management roles at Kenda

Capital BV, Anglo American plc and RMC

Group plc.

Experience:

Michael joined the Group as Chief Financial

Officer in September 2016.

He previously worked for Drax Group plc,

where he held senior financial positions

including Group Financial Controller,

and Head of Corporate Finance and Investor

Relations. Prior to Drax, Michael worked for

MT International and Arthur Andersen. He

is a member of the Institute of Chartered

Accountants in England and Wales.

External appointments:

• Chair of Mitie Group plc (FTSE 250)

• Director of several private companies,

which relate to his other business interests.

External appointments:

• None.

External appointments:

• None.

BOARD OF DIRECTORS

See page 70 for Board Overview in Detail

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 65

Experience:

Alison has substantial experience

within international blue-chip

organisations, including

multinational manufacturing,

supply chain operations and

marketing services.

Previously, she was a

Non-executive Director of Music

Magpie plc, Headlam Group plc

and James Hardie Industries

plc and held a variety of senior

management positions at

Diageo plc and Mars Inc, and

was Chief Executive Officer of

Buying Solutions, an agency

to HM Treasury.

Experience:

Iraj was a partner with Deloitte

for 20 years, leading its national

internal audit group and serving

clients in the financial, retail

and public sectors, and was a

recognised global expert and

authority on internal audit and

assurance functions. During this

time, he was also Global Head of

Internal Audit for Schroders plc,

on a secondment basis, for over

ten years.

Previously, Iraj was a member of

the FCA’s Regulatory Decisions

Committee and a trustee of the

National Employment Savings

Trust (‘NEST’). He is a fellow of the

Institute of Chartered Accountants

in England and Wales.

Experience:

Will is commercially focused and

results-driven with significant

Board experience, in both

management and advisory

capacities, and brings expertise

in stakeholder management and

M&A activities.

He held a Non-executive

advisory role at Imagesound Ltd

up to December 2023, having

previously been Chief Executive

Officer for c.nine years up to April

2023, and after having served as

Chief Financial Officer for c.seven

years prior to that. Previously, Will

was an Associate Director within

Transaction Services at KPMG

LLP and is a Fellow of the Institute

of Chartered Accountants in

England and Wales.

Experience:

Angela is an experienced

business leader in the building

materials sector, with significant

branch network experience and

insights from both multi-site retail

and merchanting.

She has held senior roles across

the various parts of the Travis

Perkins group since 2015 and has

been a member of its leadership

team since 2020. Prior to her

current role at Toolstation (see

below), Angela was Managing

Director of BSS. Before joining

Travis Perkins, she was Managing

Director of Ridgeons Group, one

of the UK’s largest independent

builders’ merchants.

Alison Littley

Senior Independent

Non-executive Director

A RN S

Date of appointment:

1 July 2022

Iraj Amiri

Independent

Non-executive Director

SRNA

Date of appointment:

7 November 2022

Will Truman

Independent

Non-executive Director

SRNA

Date of appointment:

11 May 2023

Angela Rushforth

Independent

Non-executive Director

SRN

Date of appointment:

1 February 2024

Committee key:

Member of the

Audit and Risk

Committee

Member of the

Remuneration

Committee

Member of the

Nomination

Committee

Member of the

Social Values and

ESG Committee

Denotes

Committee Chair

External appointments:

• Non-executive Director of

Norcros plc

(FTSE All-Share).

External appointments:

• Non-executive Director of

Coventry Building Society

(Private)

• Non-executive Director

of Development Bank

ofWalesplc

(government-owned)

• Non-executive Director of

Aon UK Ltd (Private).

External appointments:

• Non-executive Director of

Figura Analytics Ltd (Private).

External appointments:

• Managing Director of

Toolstation Ltd (Private).

Eurocell plc Annual Report and Accounts 202466

Beth Boulton

Marketing Director

Beth joined Eurocell in November 2021.

She previously worked for Magnet

Kitchens where she was Head of

Marketing and Digital. Prior to that role,

Beth was Marketing Director at Utopia

Bathrooms and has also held positions

at Topps Tiles and Jewson.

Cat Hambleton-Gray

People Director

Cat joined Eurocell in January 2024.

She is a highly experienced HR

practitioner, having previously been HR

Director at Home Instead, a national

specialist provider of home help. Prior to

that, she held senior leadership roles with

Halfords, Pets at Home, Medivet and

Costa Coffee.

Stuart Livingstone

Chief Operating Officer

Stuart joined Eurocell as Chief Operating

Officer in January 2025, responsible for

the branch network operations and supply

chain. He was previously Trade Director at

Howdens. Prior to that, Stuart worked for

Pets at Home and Screwfix, where he was

Director of Retail.

Vicky Williams

Group Company Secretary

Vicky joined Eurocell in May 2024. She is

a Chartered Secretary and Fellow of the

Chartered Governance Institute. Vicky

previously held the role of Group Company

Secretary at ITM Power plc and Fintel

plc. Vicky also draws from a broad career

including senior leadership roles in risk

assurance, legal services, and operations.

Mike McKay

Group IT Director

Mike joined Eurocell in March 2020.

He previously worked for Polypipe Group

(now Genuit Group) where he was Group

Information Services Director for 15 years.

Immediately prior to this, Mike was Head

of Information Services for William Grant &

Sons and he has also held positions with

Ascent Technology and APV Baker.

Executive Committee

(in addition to Darren Waters and Michael Scott)

EXECUTIVE COMMITTEE

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 67

Dear shareholder,

As a Board, we are clear that a key

component of delivering on our purpose and

driving long-term shareholder value is strong

corporate governance, which reduces risks

and promotes sustainable growth.

The Board is focused

on advancing the

strategic objectives.”

As your Chair, one of my primary

responsibilities is to oversee the Board’s

processes and decision making, to

ensure that the Group is operating in

the best interests of our stakeholders.

In doing so, I support and direct the

adoption, implementation, monitoring

and communication of the Company’s

corporate governance arrangements.

This report sets out our corporate

governance framework and explains how

it underpins and supports the Executive

Committee and senior management in

fulfilling our purpose and delivering the

Group’s strategy. It also provides details

of the Board’s activities during the year,

including how it, and its Committees,

have made key decisions and discharged

their governance responsibilities.

Following a transitional phase in 2023,

this year saw a now stabilised Board

focused on advancing the strategic

objectives we set out in last year’s Annual

Report, as well as further developing the

governance frameworks outlined on the

following pages of this report.

Throughout the year, we have continued

to apply the principles and provisions of

the UK Corporate Governance Code

(the ‘Code’) 2018, under which this report

has been prepared.

The Company has also reviewed the

revised 2024 edition of the Code and

assessed how we intend to comply

from its effective date of financial years

commencing on or after 1 January 2025

(or 1 January 2026 for the provisions

relating to risk management and internal

controls). Whilst this will be fully disclosed

in next year’s Annual Report, a summary

of our work in progress is set out in the

Audit and Risk Committee Report on

pages 82 to 87.

Finally, I would like to extend my gratitude

for the continued strong shareholder

support that we receive, which enables

us to build a platform for long-term

sustainable growth, and I hope to see that

continuing into the future.

Derek Mapp

Chair

19 March 2025

LETTER FROM THE CHAIR

Eurocell plc Annual Report and Accounts 202468

Role of the Board

The Board currently comprises a

Non-executive Chair, four Non-executive

Directors and two Executive Directors,

who are equally and collectively

responsible for the proper stewardship

and leadership of the Company. Their

biographical details are set out on pages

64 and 65.

In accordance with the Code, at least

half the Board, excluding the Chair,

should be Non-executive Directors,

who are determined by the Board

to be independent in character and

judgement, and free from relationships

or circumstances which may affect, or

could appear to affect, this judgement.

The Company regards Alison Littley, Iraj

Amiri, Will Truman and Angela Rushforth

as ‘independent’ Non-executive Directors

within the meaning of the Code and,

therefore, is considered to be compliant

in this area.

The Board also considers diversity and

inclusion throughout the Group and details

of the extent to which the Board has met

the FCA’s targets, in this regard, are set

out on page 79.

The formal schedule of matters reserved

for the Board’s consideration includes

the following.

• Approval of the Group’s strategy,

long-term objectives, annual operating

budgets and capital expenditure plans

• Approving transactions of significant

value or major strategic importance,

including acquisitions

• Approving significant changes to

the Group’s capital, corporate or

management structure

• Monitoring and assessing the overall

effectiveness of the Group’s risk

management processes and internal

control systems, including those related

to health and safety, financial controls

and anti-bribery policies and procedures

• Approving the Annual and Half-Year

Reports, including Financial Statements

• Approving other corporate

communications related to matters

decided by the Board

• Board appointments and succession

planning and setting Terms of Reference

for Board Committees

• Remuneration matters, including the

general framework for remuneration

and share and incentive schemes.

Subject to those matters reserved for

its decision, the Board has delegated

to its Audit and Risk, Nomination,

Remuneration and Social Values and ESG

Committees certain authorities. There are

written Terms of Reference for each of

these Committees, which are available

on the Group’s corporate website at:

investors.eurocell.co.uk. Separate reports

for each Committee are included in this

Annual Report on pages 77 to 111.

Details of how opportunities and risks to

the future success of the business have

been considered and addressed can be

found in the Strategic Report on pages

56 to 63. Details of the sustainability of

our business model can be found in the

Strategic Report on pages 02 to 63.

Our governance framework underpins

the delivery of strategy and can be found

on pages 68 and 69. An overview of the

Group’s strategy can be found in the

Strategic Report on pages 14 to 21.

The Directors are ultimately responsible

for preparing the Annual Report and

Accounts and the Board confirms it

considers them, taken as a whole, to be

fair, balanced and understandable, and

provides the information necessary for

shareholders to assess the Company’s

position, performance, business model

and strategy.

Governance Framework

The Board meets regularly to discuss key

business issues and prescribe actions as

appropriate. The Group’s reporting structure

below Board level is designed so that all

decisions are made by those most qualified

to do so in a timely manner. Day-to-day

management and the implementation

of strategies agreed by the Board are

delegated to the Executive Directors.

Key to this delegation is the Executive

Committee, which meets each month.

This structure enables the Board to

make informed decisions on a range

ofkey issues including strategy and

riskmanagement.

All the Directors have the right to have

their opposition to, or concerns over,

the operations of the Board and/or the

management of the Company, noted

in the minutes. During the year, no such

opposition or concerns were noted.

The Chair and the Non-executive Directors

met during the year without the Executive

Directors present.

Role of the Chair

The Board has concluded that the Chair

has met the independence criteria of the

Code on appointment.

There is a clear division of responsibilities

between the Chair and the Chief Executive.

The Chair is responsible for ensuring

that the Board functions effectively.

He sets the agenda for Board meetings

and ensures that adequate time is devoted

to discussion of all agenda items, particularly

strategic issues, facilitating the effective

contribution of all Directors and ensuring

that the Board as a whole is involved in the

decision-making process.

Role of the Chief Executive

The Chief Executive has principal

responsibility for all operational activities

and the day-to-day management of the

business, in accordance with the

strategies and policies approved by the

Board. The Chief Executive also has

responsibility for communicating to the

Group’s employees the expectations

of the Board in relation to culture, values

and behaviours.

Role of the Senior

IndependentDirector

The Senior Independent Director has an

important role on the Board, providing a

sounding board for the Chair, leading on

corporate governance issues and serving

as an intermediary for the other Directors.

She is available to shareholders if they

have concerns, which contact through

the normal channels of the Chair, Chief

Executive or other Executive Directors has

failed to resolve, or for which such contact

is not appropriate.

Alison Littley has served as Senior

Independent Non-executive Director since

her succession to the role from Frank Nelson

in May 2024.

Role of the Non-executive

Directors

All Non-executive Directors are required to

allocate sufficient time to the Company to

discharge their responsibilities effectively.

The Non-executive Directors act in a way

they consider will promote the long-term

sustainable success of the Group for the

benefit of, and with regard to the interests

of, its stakeholders.

CORPORATE GOVERNANCE STATEMENT

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 69

Eurocell plc Board Members:

•Independent Non-executive Chair •4 Independent Non-executive Directors •2 Executive Directors

Audit and Risk

Committee Members:

• 3 Independent

Non-executive Directors.

Remuneration

Committee Members:

• 4 Independent

Non-executive Directors.

Nomination Committee

Members:

• Independent

Non-executive Chair

• 4 Independent

Non-executive Directors.

Social Values and ESG

Committee Members:

• 4 Independent

Non-executive Directors

• 2 Executive Directors and

3 senior managers.

The Audit and Risk

Committee’s role is to

assist the Board with

the discharge of its

responsibilities in relation

to financial reporting,

internal controls, risk

management, compliance

and audit.

The Remuneration

Committee recommends

the Group’s policy on

executive remuneration

and determines the

levels of remuneration for

Executive Directors, the

Chair of the Board and

senior management.

The Nomination

Committee assists

the Board in reviewing

the structure, size and

composition of the Board

and succession planning

for senior management.

The Social Values and

ESG Committee’s role

is to provide formal and

transparent oversight

of the Group’s ‘ESG’

programme and

value-ledagenda.

See Committee

Reporton

pages 82 to 87

See Committee

Reporton

pages 90 to 111

See Committee

Reporton

pages 77 to 81

See Committee

Reporton

pages 88 to 89

Executive Committee

The Executive Committee comprises senior managers, including the 2 Executive Directors who act as a bridge between the

Board and this Committee. Management teams report to members of the Executive Committee. The Board receives regular

updates from the Executive Committee in relation to business issues and developments.

See page 66

Board composition, commitment

and election of Directors

The Nomination Committee leads

the process for Board appointments

and makes recommendations to the

Board. Prior to appointment, Board

members, in particular the Chair and

the Non-executive Directors, disclose

their other commitments and agree to

allocate sufficient time to the Company

to discharge their duties effectively and

ensure that these other commitments

do not affect their contribution.

The Executive Directors may accept an

outside appointment provided that such

appointment does not in any way prejudice

their ability to perform their duties as

Executive Directors of the Company.

Darren Waters and Michael Scott do not

currently hold any outside appointments.

The Non-executive Directors’ appointment

letters anticipate a minimum time

commitment of 20 days per annum,

recognising that there is always

the possibility of an additional time

commitment and ad hoc matters arising

from time to time, particularly when

the Company is undergoing a period

of increased activity. The average time

commitment inevitably increases where a

Non-executive Director assumes additional

responsibilities such as being appointed to

a Board Committee.

All new Non-executive Directors undergo an

induction programme and as such spend

considerably more than the minimum

commitment during the course of a year.

All Non-executive Directors are required to

inform the Chair before accepting another

position in order to ensure the Director

has sufficient time to fulfil their duties.

The current Board commitments of all

Directors are shown on pages 64 and

65 and their terms of appointment are

reported on pages 56 to 62.

Eurocell plc Annual Report and Accounts 202470

Gender Male Female

Ethnicity White British Other ethnic group

Length of service 0–3 years 3–7 years 8–9 years

Age

40–49 50–59 60–69 70–79

2024

2023

Board overview (as at 31 December 2024)

CORPORATE GOVERNANCE STATEMENT CONTINUED

The Company’s Articles of Association

contain powers of removal, appointment,

election and re-election of Directors and

provide that all of the Directors must retire

and may offer themselves for re-election

at each Annual General Meeting (‘AGM’).

At the upcoming AGM, all the current

Directors intend to offer themselves for

election/re-election, in accordance with

the Code. Following the conclusion of

the latest Board evaluation process, the

Board considers all the Directors to be

effective, committed to their roles and to

have sufficient time available to perform

their duties.

The Board has a process in place to

assess the current and future skills and

experience needed by the Non-executive

Directors against a matrix of requirements,

through which it has determined that the

Non-executive Directors are independent

and that the Board has appropriate and

complementary skills and experience.

Board evaluation and effectiveness

In accordance with the Code, a formal

evaluation of the Board’s performance,

along with its Committees, Chair and

individual Directors was conducted during

the year, with the results presented and

discussed at the December 2024 Board

meeting. This year’s internal evaluation

was performed by the Chair, following the

external evaluation by Haddleton Knight

in 2023.

Individual interviews were conducted

by the Chair with each Board member

and the Group Company Secretary.

Further sessions were held by the Senior

Independent Director with each Board

member and the Group Company

Secretary, to gain feedback for the Chair.

All involved fully engaged with the process

and provided their qualitative feedback,

which supported an open and frank

exchange of views.

The evaluation identified several areas of

strength and some areas for enhancement

and, overall, concluded that:

• The Board operates in an effective and

professional manner and has developed

considerably over the last two years

• Governance processes are transparent

and well run

• Risks are openly discussed with

deep-dive analysis and review of

material risks where appropriate

• There is scope, and a desire,

from the Board to develop further.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 71

In addition, the evaluation highlighted:

• Board agendas and reporting will benefit

from being further refined to be more

forward-looking

• Greater Board visibility and interaction

with the wider workforce will be

encouraged and developed further

• Board training will be strengthened

to support greater insight into the

responsibilities of Directors.

Taking all of this into account, the Board

is satisfied that the current composition of

the Board, and its Committees, provides an

appropriate balance of skills, experience,

independence and knowledge to allow the

Board and its Committees to discharge

their duties and responsibilities effectively

and in line with the Code.

Conflicts of interest

The duties to avoid potential conflicts

and to disclose such situations for

authorisation by the Board are the

personal responsibility of each Director.

All Directors are required to ensure that

they keep these duties under review and

to inform the Group Company Secretary

of any change in their respective positions.

The Company’s conflict of interest

procedures are reflected in its Articles

of Association (‘Articles’). In line with

the Companies Act 2006, the Articles

allow the Directors to authorise conflicts

and potential conflicts of interest,

where appropriate. The decision to

authorise a conflict can only be made

by non-conflicted Directors.

The Board, and its Committees, considers

conflicts or potential conflicts at each

meeting and, where such instances are

identified, takes appropriate action, usually

by excluding the conflicted party from any

related discussions/decisions.

The Articles require the Company to

indemnify its officers, including officers

of wholly-owned subsidiaries, against

liabilities arising from the conduct of the

Group’s business, to the extent permitted

by law. The Group carries Directors’ and

Officers’ liability insurance.

Board meetings and attendance

There were six full Board meetings held

during 2024, five meetings of the Audit

and Risk Committee, three meetings of the

Remuneration Committee, two meetings

of the Nomination Committee and three

meetings of the Social Values and ESG

Committee. All of these meetings were

held in-person and attendance was as

shown in the table above.

All Board members, including the Chair of

the Board, the Chief Executive, and the

Chief Financial Officer, are invited to all

Committee meetings regardless of whether

they are members of the Committee.

However, they are never involved in

discussions or decisions pertaining to

their own compensation or appointment

or replacement. In addition, the Audit

and Risk Committee also meets with the

external auditors without any Executive

Directors being present.

The Group Company Secretary is

also Secretary to the Audit and Risk,

Remuneration, Nomination, and Social

Values and ESG Committees, and attends

all meetings for this purpose.

In order to provide Directors enough

time to evaluate their papers beforehand,

Board packs are issued the week before

each meeting. Even if a Director is

unable to attend a Board meeting for any

reason, they are nevertheless informed

beforehand, given access to pertinent

documents, and their opinions are shared

with the other Directors.

The Group Company Secretary

The Group Company Secretary’s

services and advice are available to all

Directors. In addition to advising the

Board on all governance-related issues

through the Chair, the Group Company

Secretary has responsibility for making

sure that all Board processes are

followed. TheBoard receives updates

from the Group Company Secretary on

new laws, corporate governance and

regulatory matters, and the responsibilities

and duties of the Directors. Among

the mattersreserved to the Board is

the appointment and removal of the

GroupCompany Secretary.

Vicky Williams has served as Group

Company Secretary since her

appointmentin May 2024, following

PaulWalker’s departure.

Directors may, at the Company’s expense,

seek independent expert assistance

as needed. Board Committees confirm

annually that they have access to sufficient

resources to carry out their responsibilities,

including the ability to hire outside

consultants as they see fit.

Number of meetings

attended/eligible toattend Board

Audit

and Risk

Committee

Remuneration

Committee

Nomination

Committee

Social

Values

and ESG

Committee

Derek Mapp

6/6

– –

2/2

–

Alison Littley

6/6 5/5 3/3 2/2 3/3

Iraj Amiri

6/6 5/5 2/3 1/2 3/3

Will Truman

6/6 5/5 2/2 2/2 3/3

Angela Rushforth

(appointed 1 February 2024)

5/6

–

2/3 2/2 3/3

Frank Nelson

(stepped down 16 May 2024)

1/1 2/2 1/1

– –

Kate Allum

(stepped down 31 July 2024)

3/3

–

1/1 1/1 1/1

Darren Waters

6/6

– – –

3/3

Michael Scott

6/6

– – –

3/3

Eurocell plc Annual Report and Accounts 202472

Board induction, development

andsupport

Following appointment, a new Director

undergoes an induction programme,

which includes a teach-in from members

of the Executive Committee on important

business topics, such as the background

to our markets and industry, the

Company’s strategy, commercial approach,

manufacturing and logistics operations,

administrative functions and culture.

Summary of induction programme

Understand the business

• Meet, on a one-to-one basis, the

Chair, Executive Directors and other

Non-executive Directors

• Receive teach-in presentations from

all key functions within the Group,

including Commercial, Operations,

Human Resources, Finance,

Marketing and IT

• Meet with external stakeholders

where appropriate e.g. customers,

suppliers, advisers, and in some

cases, major shareholders

• Review previous Board and

Committee papers, Committee

Terms of Reference, investor

presentations and staff

surveyresults.

Meet our colleagues

• Meet with the Executive Committee

and senior management teams

• Visit all major operational sites,

including factories, the main

warehouse, a selection of branches

and the main offices, including an

opportunity to meet with colleagues

from these areas.

Individual development and training needs

are identified through the Board evaluation

process and through individual reviews

between the Directors and the Chair.

Stakeholder engagement

and Section 172(1) statement

As required by s172 of the Companies

Act 2006, the Directors of the Company

must act in the way they consider,

in good faith, would most likely promote

the success of the Company for the

benefit of its shareholders. In so doing,

the Directors must have regard

(among other matters) to:

• The likely consequences of any

decisionin the long term

• The interests of the

Company’semployees

• The need to foster the Company’s

business relationships with suppliers,

customers and others

• The impact of the Company’s operations

on the community and the environment

• The desirability of the Company

maintaining a reputation for high

standards of business conduct

• The need to act fairly as between

members of the Company.

To better comprehend the effects of

its decisions and operations, as well

as the interests and viewpoints of

our major stakeholders, the Board

takes into account information from

all areas of the business. This covers

topics including key risks, legal and

regulatory compliance, plus evaluations

of strategy, financial performance, and

operational performance. The Board and

its Committees receive this information

through reports that are circulated before

each meeting and, where necessary,

in-person presentations.

As a result of these activities, the Board

has gained a thorough understanding

of the interests and viewpoints of all key

stakeholders, as well as other relevant

factors, which helps the Directors comply

with the requirements of section 172 of the

Companies Act of 2006.

The table overleaf sets out the Board’s

approach to stakeholder engagement in

the context of some of the most important

decisions made during 2024. The Board

will sometimes engage directly with certain

stakeholders on certain issues, but the

size and distribution of our stakeholders

and of the Eurocell Group dictate that

stakeholder engagement often takes place

at an operational level. To give greater

understanding to this, we have provided

clear cross-referencing to where more

detailed information can be found in this

Annual Report.

Risk management

and internal control

The Board recognises that it is responsible

for determining the nature and extent of

the risks it is prepared to face in order to

accomplish its strategic goals and for

the oversight of the Group’s internal

control systems.

The effectiveness of the Group’s internal

control and risk management systems has

been assessed by the Board through the

consideration of reports received from both

management, and KPMG as part of our

internal audit programme. This includes an

assessment of the financial, operational,

and compliance controls for the time

period covered by this Annual Report,

as well as an evaluation of current and

emergent risks.

The Strategic Report comments in detail

(pages 02 to 63) on the nature of the

principal risks and uncertainties facing

the Group; in particular those that would

threaten our business model, future

performance, solvency or liquidity and

the measures in place to mitigate them.

In conducting its review, the Board

has included a robust assessment

of these and other emerging risks and

the effectiveness of mitigating controls.

The Audit and Risk Committee Report

on pages 82 to 87 describes the internal

control system and how it is managed and

monitored. As described in prior reports,

the cyber incident in 2022 was not the

result of a breakdown in internal controls.

Our investments over the last several

years in cyber security played a major

role in identifying the incident, enabling

core systems to be restored quickly and

mitigating the overall impact on the Group.

Throughout the subsequent period, we

have continued to invest in enhancing our

cyber security to provide further resilience

in this area.

The Board confirms that no significant

failings or weaknesses were identified

in relation to the review. The Board also

recognises that these systems can only

offer a reasonable level of assurance

against material misstatement or loss and

that they are designed to manage rather

than eliminate the risk of failing to meet

business objectives.

CORPORATE GOVERNANCE STATEMENT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 73

Customers

Why they matter

The Board recognises that establishing

strong and lasting relationships with our

customers is essential to our growth

ambitions. To become the supplier of

choice, we must, among other things,

continually improve our product offerings,

quality, availability, and service.

How we engage

• Regular contact between senior

management and key customers

• Review of insight surveys including Net

Promoter Scores and Trustpilot ratings

• Periodic forums with customer groups to

discuss product design and innovation

• Ongoing monitoring of social media

platforms for relevant comments/issues.

How the Board complements

engagementefforts

Throughout 2024, the Board received

regular updates on our performance

against customer and service-related KPIs,

compared to historical and industry/sector

benchmarks, and offered their input and

sector advice on new initiatives.

How their interests were considered

during 2024 and key decisions arising

Our Customer Growth and Business

Effectiveness strategic pillars include

continued progression of initiatives to

enhance our customers’ experience

and deliver our ambition to be the trade

customer’s preferred choice. During the

year, the Board:

• Oversaw progress on our trade counter

and enterprise resource management

system replacement projects, which (inter

alia) aim to significantly improve customer

experience and support

• Reviewed our technical team’s work with

larger customers to support conformance

with changing building regulations and

develop new products

• Reviewed our updated customer channel

strategy, which defines our customer

populations and service channels

• Approved expenditure for investment

in a new customer incentive and loyalty

programme to be launched in 2025.

For more details see Customer Growth

onpages16 and 17

Shareholders

Why they matter

The Board recognises the importance

of engaging with all shareholders and

places a high priority on having productive

conversations to gather feedback, and act

on areas of interest and concern, as well

as ensure that our regulatory obligations

are met.

How we engage

• Comprehensive investor relations

programme and regular dialogue with the

investment community

• Formal analyst presentations and investor

meetings following the announcement of

the Group’s half-year and full-year results

• Investor meetings following trading

updates and otherwise ad-hoc meetings

throughout the year

• Annual Chair’s roadshow, supported

by the Non-executive Directors

• Annual General Meetings.

How the Board complements

engagementefforts

The Board is committed to delivering

sustainable value for our shareholders

andengaged with investors during the

yearas follows:

• Chair’s roadshow meetings with major

shareholders in April/May, covering

topics such as Board composition and

succession planning, our new strategy

and capital allocation

• Senior Independent Director and

Chair met with major shareholders in

November/December to consult on

proposed changes to the Company’s

Remuneration Policy

• Board received regular updates on

shareholder engagement, investor

feedback, analyst reports, and share

price developments.

How their interests were considered

during 2024 and key decisions arising

• Investor relations is covered at all Board

meetings and updates

• Investor feedback was considered in

shaping the new strategy and revised

capital allocation policy, designed to drive

shareholder returns through a combination

of a progressive ordinary dividend and

share buybacks.

For more details see Chief Financial

Officer’s Review onpages52 to 55

The disclosures on the Company’s

substantial shareholders,

restrictions on voting rights and

powers to amend the Articles of

Association are included within

theDirector’s report on page 114.

Eurocell plc Annual Report and Accounts 202474

Colleagues

Why they matter

The Board recognises that our colleagues

are the major drivers of the Company’s

performance and success and, therefore, the

importance of providing a safe workplace that

values diversity and inclusion, and provides

employees with the opportunities to advance

in their careers and reach their full potential.

How we engage

• Regular senior management team-briefings

on progress with the strategy, operational

and financial performance, with a summary

cascaded through the organisation

• Monthly Company magazine,

focusing on information-sharing and

colleagueengagement

• Periodic staff surveys, with results used

to drive change and improvement

• Regular attendance by Executive

Committee members on safety walks

and at safety stand-downs

• Board-level sponsorship for review of

whistleblowing reports and subsequent

lessons learned.

How the Board complements

engagementefforts

• Non-executive Director listening

groupstogather colleagues’ views

onimportant topics

• Board member visits to operating sites and

branches to drive enhanced engagement

and increase Board awareness of

day-to-day activities and challenges

• Social Values and ESG Committee

receives progress updates on colleague

engagement and wellbeing initiatives

• Board review of staff survey results,

with proposed action plan considered

and implementation monitored.

How their interests were considered

during 2024 and key decisions arising

During 2024, management’s proposals and

activities relating to our People First strategic

pillar were considered by the Board with the

following actions arising:

• Approval of the 2024 annual pay award

• Review of the Group-wide grading

framework development and wider

work-force compensation and

benefitarrangements

• Oversight of the Company’s gender pay

gap reporting

• Oversight of the design of a new ‘Winning

Formula’ colleague engagement survey,

focused on workplace culture

• Rebranding of the people proposition

to ‘Eurocell & You’

• Approval of changes to the operational

structures and reporting lines of the

Branch Network.

For more details see People First

on pages 27 to 29

Suppliers

Why they matter

The Board appreciates that to operate

effectively we must ensure secure supplies

of good quality sustainable materials at a

fair price from suppliers with high ethical

standards, and monitor supplier performance

against appropriate metrics.

How we engage

• Regular review meetings between senior

management and key suppliers, covering

topics such as pricing, supply continuity

and service levels

• Formal tender processes conducted

for large/high-value supplies

• Engagement with suppliers on

how wecansupport each other

onenvironmental matters

• Clear communication of our expectations

for suppliers in terms of conduct and ethics.

How the Board complements

engagementefforts

During 2024, cost inflation continued to

be discussed at all Board meetings and

updates. Board members shared their ideas

and experiences on supplier relationships

and engagement, in the light of current risks

and challenges.

How their interests were considered

during 2024 and key decisions arising

The Board continued to work with,

andadvise, management on their

approach,including:

• To closely manage supplier agreements

to provide security of supply at fair prices,

particularly with regards to PVC resin,

electricity and recycling feedstock

• To pass a fair proportion of cost inflation

onto our own customers through

sellingprice increases.

For more details see Sustainable

Products on pages 36 to 37

CORPORATE GOVERNANCE STATEMENT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 75

Environment and communities

Why they matter

Environmental, Social and Governance (‘ESG’)

considerations have been a key part of the

Board’s agenda again in 2024, as we further

develop our plans in this very important area.

The Board understands the role all organisations

have to play in protecting the environment and

in mitigating the impact of climate change.

TheBoard also recognises the need to support

the local communities in which our larger

facilities are located.

How we engage

• Leading UK-based recycler of PVCwindows

• Ongoing review of our environmental

impact and action plans to reduce this

• Consultation with our suppliers to achieve

reductions in carbon emissions across

ourvalue chain

• Recruit locally ambition

• Major operational sites engage with,

and support, local communities

• Corporate partnership with Maggie’s

(cancer support charity).

How the Board complements

engagementefforts

The Board provides oversight on these

matters through the Social Values and ESG

Committee and maintains an open dialogue

with our advisers, CEN Group, who regularly

attend Committee meetings to engage on

ESG topics.

How their interests were considered

during 2024 and key decisions arising

• Board review and approval of our

Net Zero Transition Plan and associated

science-based targets for emissions

reduction

• Oversight of the project to install solar

panels at our primary extrusion site

(now complete), plus approval of the

capital investment to install solar panels

at our head office and distribution centre

in 2025

• Monitoring of external ESG rating’s agency

assessments of the Company’s disclosures

• Renewed corporate partnership agreement

with Maggie’s (cancer support charity)

raising £46,000 in 2024.

For more details see Environmental

Leadership on pages 30 to 33

Government and regulatory/

industrybodies

Why they matter

The Board recognises the critical importance

of ensuring the highest standards of

corporate governance, including compliance

with the rules for listed companies and other

relevant regulations (e.g. health and safety,

and taxation), which together give us our

licence to operate.

How we engage

• Adherence to the UK Corporate

Governance Code principles

andprovisions

• Clear policies to help prevent wrongdoing,

including whistleblowing, bribery and

corruption, fraud, financial crime and

modern slavery, with training provided

where appropriate

• Regular meetings with tax advisers

to review tax compliance and

HMRCcorrespondence

• Members of the Windows and Recycling

groups of the British Plastics Federation

and the British Fenestration Rating

Council, which provide a forum to

understand changes in relevant legislation

and building standards.

How the Board complements

engagementefforts

The Audit and Risk Committee receives

regular reports on governance, regulatory

and compliance matters from management

and from external and internal auditors.

The internal audit programme is designed

to provide assurance in this area.

In addition, the Board receives updates on

matters such as developments in building

regulations and our associated new product

development initiatives.

How their interests were considered

during 2024 and key decisions arising

• Review of the 2024 revisions to the

UK Corporate Governance Code, with

preparatory work to support compliance

from the effective date of financial years

beginning on or after 1 January 2025

guided by the Audit Committee

• Review of the Company’s arrangements

to prevent wrongdoing, including

whistleblowing, bribery, corruption, fraud,

financial crime, and modern slavery

• Approval of the Company’s tax policy

• Review of the requirements of the

Economic Crime and Corporate

Transparency Act 2023.

For more details see Ethics and

Compliance on pages 38 to 39

Eurocell plc Annual Report and Accounts 202476

Engagement with the workforce

As described in Stakeholder engagement

on pages 73 to 75, we acknowledge that

our colleagues provide the foundation for

our Company’s performance and success,

and that in the present social, political, and

economic climate, active engagement is

more important than ever.

To supplement the team briefings,

continuous improvement workshops, and

health and safety forums already in place,

the Group hosts a variety of colleague

engagement initiatives. These include:

• A digital Company magazine, ‘Eurocell

& You’, which updates on performance

and other important activities around

the Group, with a focus on information

sharing and colleague engagement

• Frequent colleague focus groups with

the designated Non-executive Director,

Alison Littley, to ensure that the Board

hears the opinions of the workforce

• Departmental listening groups to allow

colleagues to provide direct feedback

from which appropriate action plans can

be formulated

• Group-wide staff surveys, to provide

invaluable insight into how our

colleagues feel

• Review of retention and recruitment

challenges, to identify areas for

improvement and ensure we remain

competitive in the labour market

• Improvements to the induction process

for new colleagues

• More flexible working arrangements,

including hybrid working

whenappropriate

• Improvements in colleague facilities

and restrooms as part of an overall staff

welfare improvement programme

• Ongoing opportunities for all colleagues

to become shareholders through the

Save As You Earn scheme.

The Board evaluates and tracks culture

through:

• Examining staff survey results and

response rates

• Reviewing staff turnover rates

• Scrutinising health and safety data,

including near-misses

• Reviewing colleague

whistleblowingcases

• Engaging with senior management

and colleagues

• Observing attitudes towards internal

and external auditors and regulators

like HMRC and HSE.

Through the implementation of consistent

annual salary evaluations, annual bonus

target-setting, and benefit entitlement,

executive compensation has been, and

remains, in line with the Company’s overall

pay policy. As a result, it has not been

considered necessary to engage with

colleagues on this matter.

Overall, the Board is pleased with how

culture, including values and behaviours,

are evolving across the Group, and

with the increasing levels of colleague

engagement now taking place.

Statement of compliance with

theCode

This Corporate Governance Statement,

together with the Nomination Committee

Report, the Audit and Risk Committee

Report and the Remuneration Committee

Report, provide a description of how the

principles and provisions of the Code have

been applied during the year.

It is the Board’s view that, during 2024,

Eurocell plc was in compliance with the

relevant provisions set out in the Code in

all material respects.

This statement complies with sub-sections

2.1, 2.2(1), 2.3(1), 2.5, 2.7, 2.8(a) and

2.10 of Rule 7 of the Disclosure Rules

and Transparency Rules of the Financial

Conduct Authority. The information

required to be disclosed by sub-section

2.6 of Rule 7 is shown on pages 112

to 115.

Annual General Meeting

Our AGM will be held at our Head Office

(see Company Information on page 173

for details) on 15 May 2025.

The notice of our AGM, together with the

Directors’ voting recommendations on the

resolutions to be proposed, is included on

a separate circular to shareholders and will

be dispatched at least 21 clear days before

the meeting. The notice will be available to

view at investors.eurocell.co.uk.

All Directors intend to attend the AGM,

including the Chairs of the Audit and

Risk,Remuneration, Nomination and

Social Values and ESG Committees,

who are available to answer questions.

The Board welcomes questions from

shareholders who have an opportunity

toraise issues informally or formally

beforeor during the meeting.

For each proposed resolution, the proxy

appointment forms provide shareholders

with the option to direct their proxy vote

either for, or against, the resolution or to

withhold their vote. The proxy form and

any announcement of the results of a vote

make it clear that a ‘vote withheld’ is not a

vote in law and will not be counted in the

calculation of the proportion of the votes

for and against the resolution.

All valid proxy appointments are properly

recorded and counted by Equiniti, the

Company Registrars. Information on the

number of shares represented by proxy,

the proxy votes for and against each

resolution, and the number of shares in

respect of which the vote was withheld

for each resolution, together with the

proxy voting result, are given at the AGM.

The total votes cast, including those at

the AGM, are published on our website

(investors.eurocell.co.uk) immediately after

the meeting.

Derek Mapp

Chair

19 March 2025

CORPORATE GOVERNANCE STATEMENT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 77

Dear shareholder,

I am pleased to report to you on the

main activities of the Committee

and how it has performed its duties

duringthe year.

Summary of activities during

theyear

The Nomination Committee met twice

during the year and attendance at the

meetings is shown on page 71.

The main activities of the

Committeeincluded:

• Oversight/recommendation of the

changes to the Board, Committees

and other senior management,

as outlined within this report

• Considering the results of the external

evaluation of the Committee’s

effectiveness (see pages 70 to 71 for

further details)

• A review of Directors’ time commitments

and independence

• Consideration of the re-election of

Directors at the Annual General Meeting

• Approving updates to the Committee’s

Terms of Reference

• Considering and approving the

Committee’s report for inclusion in the

Annual Report and Accounts.

NOMINATION COMMITTEE REPORT

Committee composition

Will Truman Alison Littley Frank Nelson

Kate Allum

Iraj Amiri Angela

Rushforth

Role and responsibilities

The principal duties of the

Nomination Committee are to:

• Regularly review the structure,

size and composition of the

Board (including its skills,

knowledge, experience, length of

service and diversity) and make

recommendations to the Board

with regard to any changes

• Identify and nominate, for approval

by the Board, candidates to fill

Board vacancies

• Review the time commitments

required from Non-executive

Directors, along with the number

of external directorships held,

to ensure all duties are being fulfilled

• Maintain an effective succession

plan for the Board and senior

management, considering the

challenges and opportunities

facing the Company, along with

theskills and expertise needed

in the future, while promoting

diversity of ethnicity, gender,

background and skills.

Derek Mapp

Chair of the Nomination Committee

1 Stepped down from the Board 16 May 2024.

2 Stepped down from the Board 31 July 2024.

3 Appointed to the Board 1 February 2024.

Eurocell plc Annual Report and Accounts 202478

Board, Committee and other senior

management changes

The following changes to key roles

and personnel were overseen by the

Committee during the year:

• The appointment of Angela Rushforth as

an independent Non-executive Director

in February 2024

• Following Frank Nelson’s retirement

by rotation at the 2024 AGM, the

appointment of Alison Littley as Senior

Independent Non-executive Director

from that date

• The appointment of Alison Littley

as Remuneration Committee Chair

following the resignation of Kate Allum

in July 2024

• The appointment of Will Truman to

the Remuneration Committee in July

2024. Following the 2025 AGM, Will

shall take over the role of Remuneration

Committee Chair, to allow Alison Littley

to focus on her Senior Independent

Non-executive Director duties

• The appointment of Cat Hambleton-Gray

as People Director in January 2024

• The appointment of Vicky Williams as

Group Company Secretary in May 2024

• The appointment of Stuart Livingstone as

Chief Operating Officer in January 2025.

Nomination Committee members

During 2024, the Nomination

Committeecomprised:

Chair:

Derek Mapp

Committee members:

Iraj Amiri

Alison Littley

Will Truman

Angela Rushforth (from 1 February 2024)

Frank Nelson (until 16 May 2024)

Kate Allum (until 31 July 2024)

Nomination Committee structure

and governance

The Code recommends that a majority

of the Nomination Committee be

Non-executive Directors, independent in

character and judgement and free from

any relationship or circumstance, which

may, could or would be likely to, or appear

to, affect their judgement. The Board

considers that the Company complies

with the Code in this respect.

Only members of the Committee have the

right to attend Committee meetings, but

the Committee may invite others, including

the People Director and external advisers,

to attend all, or part of, any meeting if

it thinks it is appropriate, necessary, or

pursuant to the terms of any agreement

with shareholders.

No individual participates in discussion or

decision making when the matter under

consideration relates to themselves.

The Committee is supported by the

services of the Group Company Secretary,

and it is empowered to appoint search

consultants and other professional advisers

as it sees fit to assist with its work.

The Nomination Committee will meet

as often as it deems necessary but, in

accordance with its Terms of Reference,

at least twice a year.

NOMINATION COMMITTEE REPORT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 79

FCA target At 31 December 2024 At 31 December 2023

% of women on the Board At least 40% 29%

25%

Number of senior Board positions

heldbywomen At least 1 1

–

Number of Board members from

an ethnic minority background At least 1 1

1 FCA target not met.

2 FCA target met.

3 Senior Board positions are Chair, Chief Executive, Senior Independent Director or Chief Financial Officer.

Diversity and inclusion

A range of personal strengths and industry

backgrounds is represented on the

Board. All Board and senior management

appointments are made on merit, in line

with the approach adopted throughout the

Group’s workforce.

The Board recognises and embraces

the benefits of diversity and, in particular,

the value that different perspectives and

experience bring to the quality of debate

and decision making. The Company has

a documented Board Diversity Policy,

available at, investors.eurocell.co.uk,

which covers both Board and

Committeeappointments.

The Board recognises the Group operates

in a historically male-dominated industry

but is committed to consider diversity

as a key element in senior appointments.

The table below summarises the progress

made against each of the FCA’s Board

diversity targets:

At 31 December 2024, being the chosen

reference date, the Group met two of the

three FCA diversity targets.

Progress made towards meeting the target

of 40% of women on the Board (38% at

the conclusion of the 2024 AGM) was

impacted by the resignation of Kate Allum

in July 2024, a role that the Company has

chosen not to replace at this time.

This, along with the relatively small size of

the Board, and the pre-existing Directors’

service contracts, has inevitably limited

the pace of change but, nevertheless, as

vacancies arise, the Board will continue

tomove towards the FCA’s targets

wherever possible.

However, the overriding policy in any new

appointments will continue to be one of

selecting candidates with an appropriate

mix of skills, capabilities and market

knowledge, to ensure the continued

success of the business.

Eurocell plc Annual Report and Accounts 202480

Gender representation

The above data was collected on the basis of self-reporting by the individuals concerned who were asked to select their gender/

ethnicity from a list of options derived from the FCA’s template.

The gender balance of those in the senior management and their direct reports is included within the Sustainability Report on page 29.

Details of the Board and Executive Committee’s gender/ethnicity is as follows:

At 31 December 2024

Number of

Board members % of the Board

Number of senior

positions on the Board

(CEO, CFO, SID and Chair)

Number in executive

management

% of executive

management

Men 5 71% 3 2 40%

Women 2 29% 1 3 60%

Total 7 100% 4 5 100%

At 31 December 2024

Number of

Board members % of the Board

Number of senior

positions on the Board

(CEO, CFO, SID and Chair)

Number in executive

management

% of executive

management

White British or other White

(including minority-white groups) 6 86% 4 5 100%

Other ethnic group, including Arab 1 14% – – –

Total 7 100% 4 5 100%

At 31 December 2023

Number of

Boardmembers % of the Board

Number of senior

positions on the Board

(CEO, CFO, SID and Chair)

Number in executive

management

% of executive

management

Men 6 75% 4 3 75%

Women 2 25% – 1 25%

Total 8 100% 4 4 100%

At 31 December 2023

Number of

Boardmembers % of the Board

Number of senior

positions on the Board

(CEO, CFO, SID and Chair)

Number in executive

management

% of executive

management

White British or other White

(including minority-white groups) 7 88% 4 4 100%

Other ethnic group, including Arab 1 12% – – –

Total 8 100% 4 4 100%

Ethnicity representation

NOMINATION COMMITTEE REPORT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 81

Succession planning

In 2024, the Committee continued its proactive work on succession planning for the Board.

As part of this process, a detailed review of the composition, skills and experience

of the Board, and each of its Committees, is maintained, together with desired role

profiles, which identify the preferred attributes to be sought in future appointments.

The process includes an analysis of any succession gaps or risks identified and includes

contingency plans for the sudden or unexpected departure of Executive Directors or

other senior managers.

All appointments to the Board are subject to a formal, rigorous and transparent

appointment process, and are made based on merit and objective criteria. The process

for these appointments is typically as follows:

The Committee also advises and oversees

senior management talent assessments,

appointments and succession plans,

in order to maintain an appropriate balance

of skills, experience and diversity within the

Company. The benefits of this proactive

approach are illustrated by the ongoing

evolution of the Executive Committee.

During 2024, a Group-wide grading and

progression framework was established,

which in 2025 will be developed to identify

personal development and succession plans

for key individuals and senior positions.

In summary, we are confident that the

Board has a good understanding of

succession planning across the Group

and the range of measures being used to

continue to develop and recruit talented

senior employees, and that this will be

further strengthened by the activities

planned for 2025.

Derek Mapp

Chair of the Nomination Committee

19 March 2025

Candidate

requirements

A detailed

candidate

profile setting

out required

capabilities and

experience is

agreed and

passed to an

independent

search firm

to facilitate

theprocess

Independent

search firm

prepares an

initial long-list

of candidates

and conducts

the first round

of interviews

to assess the

candidates’

fit with the

role and key

competencies

Interviews

The Committee

then considers

a shortlist of

candidates and

interviews are

held with all

Board members

Board

approval and

announcement

The Committee

makes a

recommendation

to the Board for

its consideration.

Following Board

approval, the

appointments

areannounced

tothe market

Eurocell plc Annual Report and Accounts 202482

Dear shareholder,

I am pleased to report to you on the

Audit and Risk Committee’s objectives,

responsibilities and activities during 2024.

In the light of the Financial Reporting

Council’s (‘FRC’s’) work on UK audit

and corporate governance reform, the

Committee has continued to focus on the

Company’s approach to risk management

and internal controls, and has monitored

the implementation of planned

improvements in this area.

In addition, the Committee has overseen

management’s preparation for the 2024

amendments to the UK Corporate

Governance Code, which (inter alia)

will require Directors to attest to the

effectiveness of material controls on an

annual basis for financial years beginning

on or after 1 January 2026. For this

purpose, the Group has defined material

controls as being those controls over which

the Board considers external stakeholders

would want to receive assurance on their

adequacy and effectiveness.

The Group has made good progress in

identifying and documenting its material

controls, and we will report on our

progress towards compliance with the

new provisions in our 2025 Annual Report.

In reviewing the 2024 Annual Report, the

Committee considered the key areas of

accounting estimates and judgements

noted on page 84. In doing so, the

Committee reviewed the classification

of certain cloud-based computing and

acquisition-related costs as non-underlying

items, on the basis that both items are

material and non-recurring in nature,

and concluded that such presentation

was appropriate.

The Internal Audit programme for 2024

included a review of five business areas,

details of which are included on page 86.

These reviews did not highlight any high-risk

issues and demonstrated solid foundations

upon which further developments and

improvements can be based.

Another key area of work for the

Committee in 2024 has been oversight

of a tender process for the appointment

of our external auditor, recognising that

PricewaterhouseCoopers LLP’s tenure will

reach ten years at the conclusion of the

2024 audit. Following the tender process,

the Committee recommended to the Board

that a resolution be put to shareholders at

the 2025 AGM to appoint Deloitte LLP as

external auditor. Full details of the process

are set out on page 87 of this report.

Further information on our activities is set

out in this report. Collectively, this work

has provided the necessary assurance

to the Committee that internal controls

and governance arrangements are both

adequate and operating effectively, and

that the 2024 Financial Statements are fair,

balanced and understandable.

Finally, I would like to thank my fellow

Committee members, and both the internal

and external auditors, for their valuable

contribution and support during year.

Iraj Amiri

Chair of the Audit and

RiskCommittee

19 March 2025

AUDIT AND RISK COMMITTEE REPORT

Committee composition

Frank Nelson

Alison Littley Will Truman

1 Stepped down from the Board 16 May 2024.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 83

Role and responsibilities

The key responsibilities of the Committee are as follows.

• Review the Annual Report, Half-Year Report and any other formal announcements

relating to the Group’s financial performance, giving due consideration to significant

accounting issues and judgements contained therein, as well as compliance with

accounting standards and other legal and regulatory requirements

• Review the Annual Report and Financial Statements to advise the Board on

whether they give a fair, balanced and understandable explanation of the

Group’s business and performance over the relevant period

• Review the effectiveness of the Group’s financial reporting systems and procedures

• Consider the Group’s internal controls and risk management systems and advise

the Board whether they are adequate, by receiving reports on their effectiveness

from the Chief Financial Officer and Chief Executive, together with reports from

the Group’s outsourced internal auditors and from the external auditor

• Review updates to the Group’s risk register presented by management

• Oversee the Group’s procedures to ensure compliance with the provisions of the

Bribery Act 2010 and the Group’s Whistleblowing Policy

• Consider the external auditors’ independence and objectivity, audit and non-audit

fees and make recommendations regarding audit tender and the appointment and

remuneration of the auditors, together with the terms of their engagement

• Review the annual audit plan and monitor the effectiveness of the external

audit process

• Monitor and review the effectiveness of the outsourced internal audit function,

including a review of the internal audit plan, all internal audit reports, and

management’s responses to the findings and recommendations of the internal

audit function

• Consider the adequacy of the Group’s finance function

• Review the Group’s Tax Strategy

• Review the Committee Terms of Reference

• Reviewed the Committee’s composition and effectiveness.

Summary of activities during

theyear

The Audit and Risk Committee met formally

five times during the year and attendance

at the meetings is shown on page 71.

The areas of particular focus for the

Committee in 2024, and up to the date

of this Annual Report, were as follows:

• Continued to review the Group’s

approach to risk management and

internal controls and developed

recommendations regarding the

effectiveness, formalisation and

documentation of both new and existing

policies and processes

• Ongoing review and guidance of the

work in progress to ensure the Group

will be ready to comply with the 2024

amendments to the UK Corporate

Governance Code, which become

effective for financial years beginning

on or after 1 January 2025

• Considered the appropriate accounting

treatment, reporting and presentation

of expenditure incurred on the project to

replace our trade counter and enterprise

resource planning (‘ERP’) systems,

including cloud-based computing costs

• Considered reports by management

related to the effectiveness of the

Group’s systems of risk management

and internal control

• Reviewed the Group’s risk register,

including principal and emerging risks

• Considered reports prepared by

theGroup’s outsourced internal

auditfunction

• Considered the results of the

internalassessment of the

Committee’seffectiveness

• Approved updates to the Committee’s

Terms of Reference.

The Committee was also kept up to date

with changes to accounting standards

and developments in financial reporting,

company law and other regulatory matters

through presentations from the external

auditors, Chief Financial Officer and the

Company’s finance function.

The role of the Audit and Risk Committee

is to oversee financial reporting, review

the ongoing effectiveness of the Group’s

internal controls and provide assurance on

the Group’s risk management processes.

The Committee also assesses information

received from the external and internal

audit functions.

Following the 2024 year-end, at the March

2025 meeting, the Committee reviewed

and recommended for approval by the

Board, the financial results for the year

ended 31 December 2024, including a

review of the full-year external audit.

As part of that process, the members

of the Committee reviewed the Annual

Report, including the adequacy of the

disclosure with respect to going concern

and viability reporting. The Committee

considered the appropriateness of

preparing the accounts on a going

concern basis, including consideration

of forecast plans, and supporting

assumptions, as well as sensitivity

analysis, and concluded that the

Company’s financial position was such

that it continued to be appropriate for

accounts to be prepared on a going

concern basis.

This additional review by the Audit and

Risk Committee, supplemented by advice

received from external advisers during

the drafting process, assisted the Board

in determining that the report was fair,

balanced and understandable at the time

that it was approved.

• Oversight of the tender process for the

selection of our external auditor and

recommendation to the Board and

shareholders to appoint Deloitte LLP

with effect from the 2025 AGM

• Oversight of arrangements to continually

strengthen the cyber defences and

further develop resilience and security in

this area (including consideration of the

conclusions from previous cyber audits)

• Reviewed the external auditor’s plan

for their audit for the year ended

31 December 2024

• Reviewed reports from the external

auditors setting out their findings arising

from their audits for the years ended

31 December 2023 and 2024, as well as

their review of the 2024 Half-Year Report

• Reviewed documentation prepared to

support the viability statement and going

concern assumption set out on page 63

• Considered the impact of any new

accounting standards and financial

reporting requirements, including

guidance issued by the Financial

Reporting Council (‘FRC’)

Eurocell plc Annual Report and Accounts 202484

Audit and Risk Committee members

During 2024, the Audit and Risk

Committee comprised:

Chair:

Iraj Amiri

Committee members:

Frank Nelson (until 16 May 2024)

Alison Littley

Will Truman

All members of the Committee served

throughout the year, unless otherwise stated.

The Governance Code recommends

that all members of the Audit and Risk

Committee are Non-executive Directors,

independent in character and judgement

and free from any relationship or

circumstance which may, could or would

be likely to, or appear to, affect their

judgement and that one such member has

recent and relevant financial experience.

The Board considers that the Company

complies with the requirements of

the Governance Code in this respect,

and that, by virtue of their extensive

experience(details of which are set

out on pages 64 to 65), Iraj Amiri,

aFellow ofthe Institute of Chartered

AccountantsinEngland and Wales,

andWill Truman, a Fellow of the

Institute of Chartered Accountants in

England and Wales, both have recent

and relevant financial experience.

Furthermore, all Committee members

have extensive relevant commercial

and operational experience, including

in building/construction and industrial

organisations,which both benefitthe

Committee and collectively illustrate its

competence relevant to thesector in

which the Group operates.

Only members of the Committee have

the right to attend Committee meetings,

but both the internal and external auditors

were invited to attend all meetings during

the year, as a matter of course. The Chair

of the Board, the Chief Executive, the

Chief Financial Officer and other members

of the Board were also invited to attend all

the Committee meetings during the year.

In addition, the external and internal

auditors met regularly with the Committee

without executive management being

present and met separately with each of

the Audit and Risk Committee Chair and

the Chief Financial Officer.

The Audit and Risk Committee will meet

as often as it deems necessary but,

in accordance with its Terms of Reference,

at least three times a year.

Key accounting estimates and judgements

As described above, the Committee reviewed the key estimates and judgements used in the preparation of the Group’s 2024

Financial Statements (including a review of PricewaterhouseCoopers LLP’s report and a discussion of their observations and findings

in this area) as follows:

Area Estimate/judgement Management’s approach Committee’s review

Accounts

receivable

recoverability

Provision for bad and

doubtful debts

Application of IFRS 9’s expected credit

loss approach to the impairment of

receivables (which requires the use of

forward-looking statistical modelling

to determine the appropriate level of

provision), plus overlays to take into

account other material factors affecting

recoverability, including credit insurance.

Critically evaluated the methodology with

respect to setting provisions for potential

bad and doubtful debts, including

management’s assessment of macro

uncertainty, as well as the absolute level

of provisions held

Inventory

valuation

Provision for

slow-moving items

and discontinued

product lines

Assessment of the appropriate level

of provisioning against obsolescence,

undertaken in the context of current trading

and the forecast for the next financial year

and beyond.

Critically reviewed the carrying value

of the Group’s inventory, the approach

taken by management and assessed

the reasonableness of the underlying

assumptions and financial forecasts used.

1 The Committee’s review also considered the specific nature and characteristics of customers in the Group’s two major divisions.

AUDIT AND RISK COMMITTEE REPORT CONTINUED

Risk management

The Group’s risk management processes

are set out in detail on pages 56 and 57.

In light of the Financial Reporting Council’s

(‘FRC’s’) work on UK audit and corporate

governance reform, and the revised UK

Corporate Governance Code (2024),

the Group has reviewed its approach to

risk management and internal controls,

and developed a plan to further improve

their effectiveness. Implementation

of these changes has begun and will

continue into 2025.

A description of our work in relation

to internal controls is included in the

next section.

In terms of risk management, a formal

Risk Appetite Statement has been

developed and approved by the Board,

with supporting frameworks now in

place for risk management, assurance

strategy and policy management, along

with the implementation of enhanced

risk assessment tools to support the risk

management approach.

These tools include the preparation of a

risk canvas, the completion of checklists

from the FCA’s Systems and Controls

Sourcebook and Corporate Governance

code, and a risk materiality assessment.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 85

The Group’s Risk Management Committee

is chaired by the Chief Financial Officer.

This Committee reviews significant risks

and the status of related mitigating actions.

The Audit and Risk Committee reviews

the risk register twice per year to ensure

the timely identification and robust

management of inherent and emerging

risks is taking place. To the extent that any

failings or weaknesses are identified during

the review process, appropriate measures

are taken to remedy these.

Information relating to the management of

risks and any changes to the assessment

of key risks is reported by the Audit and

Risk Committee to the Board.

Internal controls

The Board is responsible for the overall

system of internal controls for the Group

and for reviewing its effectiveness.

The Board receives assurance on internal

control effectiveness at least annually,

covering all key controls including financial,

operational and compliance controls and

risk management systems.

In particular, the Board discharges its

duties in this area by:

• Holding regular Board meetings to

consider the matters reserved for

its consideration

• Receiving regular management reports,

which provide an assessment of key

risks and mitigating actions

• Scheduling annual Board reviews of

strategy including consideration of the

material risks and uncertainties facing

the business

• Ensuring there is a clear organisational

structure with defined responsibilities

and levels of authority, which are

regularly reviewed

• Scheduling regular Board reviews of

performance against financial budgets

and forecasts.

In reviewing the effectiveness of the

system of internal controls, the Audit

and Risk Committee:

• Reviews the risk register compiled

andmaintained by senior managers

within the Group, at least bi-annually,

receives reports on near misses,

errorsand inaccuracies

• Receives management assurance on

the effectiveness of the systems of

financial and accounting controls

• Regularly reviews the internal audits

performed and the progress against

previously raised recommendations.

The Group has several operating policies

and controls in place covering a range of

issues including financial reporting, capital

expenditure, business continuity and

information technology, including cyber

security, and appropriate employee policies.

These policies are designed to ensure

the accuracy and reliability of financial

reporting and govern the preparation of

financial statements.

In respect of the Group’s financial reporting,

the Finance function is responsible for

preparing the Group financial statements

using a well-established process and for

ensuring that accounting policies are in

accordance with International Financial

Reporting Standards.

Consolidated accounts are prepared

directly within the Group’s SAP system.

All business units report on SAP, with no

adjustments processed outside of the

system, other than the accounting entries

to reflect IFRS 16 (Leases), which are

produced by a specialist lease accounting

software package. Full balance sheet

reconciliations are prepared every month

and independently reviewed by senior

finance staff. The Chief Financial Officer

reviews consolidated and business

unit financial statements with the Chief

Executive every month. All financial

information published by the Group is

subject to the approval of the Audit and

Risk Committee.

Following the cyber incident in 2022, we

have continued to invest in infrastructure

to improve resilience and security in this

area. The Group’s IT team have remained

vigilant to cyber risks and have rolled-out

enhanced regular cyber training for all staff.

Other than as described, there have been

no changes in the Company’s internal

control systems during the financial year

under review that have materially affected,

or are reasonably likely to materially

affect, the Company’s control over

financial reporting.

The Board, with advice from the Audit

and Risk Committee, is satisfied that

an effective system of internal controls

and risk management is in place, which

enables the Company to identify, evaluate

and manage key and emerging risks,

and which accords with the guidance

published by the FRC.

These processes have been in place since

the start of the financial year and up to the

date of approval of the accounts. Further

details of specific material risks and

uncertainties facing the business can be

found on pages 58 to 62.

In addition, as noted, the 2024

amendments to the UK Corporate

Governance Code will require Directors

(inter alia) to attest to the effectiveness

of material controls on an annual basis

for financial years beginning on or after

1 January 2026. The Committee has

provided ongoing review and guidance

over the steps being taken to ensure the

Group will be able to comply with the

revised Code. The Group has defined

material controls as being those controls

over which the Board considers external

stakeholders would want to receive

assurance about their adequacy and

effectiveness. We are now well

progressed with our work to ensure all

key financial and operational processes

are documented, in the

process identifying material risks and

controls, and we will report on our

progress towards compliance with the

new provisions in our 2025 Annual Report

and Accounts.

Eurocell plc Annual Report and Accounts 202486

Internal audit

KPMG LLP provide an outsourced Internal

Audit function, which complements the

internal finance-based checks performed

on the branch network operations.

AUDIT AND RISK COMMITTEE REPORT CONTINUED

The Committee, working in conjunction

with KPMG LLP, approved a full

programme for 2024, which was compiled

based on the following specific categories.

• Risk: internal audit reviews specifically

linked to Eurocell’s key financial and

operational risks

• Routine: internal audit reviews covering

financial, regulatory, compliance and

IT operations, which require cyclical

assurance coverage

• Request: internal audit reviews that

have been specifically included at

the request of either management,

the Audit Committee or the Board.

A summary of the 2024 programme is as follows:

Internal audit programme Summary of findings

Outbound Delivery

Accuracy

• Recommendations to implement additional KPIs (e.g. time to service customer queries) and formalise

meeting action minutes.

Expenses • Vast majority of expenses are processed correctly, with approvals and evidence documented

• For expenses deviating from policy guidelines (including outbound gifts/hospitality), approval is in

place,but not always formally documented in advance. Policy and practice to be reviewed and

updated accordingly.

System

Implementation

• Project is led by experienced staff and there is positive feedback/engagement from key stakeholders

across the business

• Key governance documents are in place, with some gaps identified compared to best practice project

documentation to be addressed.

Procure to Pay • There has been a significant improvement in the Requisition to Pay processes since this area was last

subject to an internal audit in 2017

• New recommendations are low-risk items, principally related to formalising policy documentation.

Follow-up on Previous

Internal Audit

Recommendations

• The format of the internal audit action tracker requires a more nuanced descriptor of the state of

individual actions (e.g. add ‘superseded’ or ‘risk accepted’) and stronger evidence of completion

should be documented by action owners and tested by the Internal Controls team.

The Committee is satisfied with the overall delivery of the KPMG internal audit programme.

In addition to the topics reviewed by KPMG, in 2024, the Board received reports from management providing assurance over

internal controls operating in the following business areas: health and safety, cyber security, new building regulations, effectiveness

of standard sales terms and conditions, succession planning and theft mitigation (including individuals’ safety).

Whistleblowing, bribery

and business ethics

The Group is committed to the highest

standards of openness, honesty, integrity

and accountability.

The Group maintains a suite of policies,

which support our commitment to strong

business ethics, and for which we take a

strict approach to non-compliance.

This includes policies related to:

• Financial crime

• Conflicts of interest

• Gifts and hospitality

• Share dealing.

In addition, the Whistleblowing policy

makes colleagues aware that they should

report any serious concerns or suspicions

about any wrongdoing or malpractice on

the part of any colleague of the Group,

without fear of criticism, discrimination or

reprisal, as well as the procedure for raising

such concerns.

Each report is triaged by a nominated

committee of senior management,

and subsequently referred to the Senior

Independent Non-executive Director.

The Committee also takes responsibility

for reviewing the policies and procedures

adopted by the Group to prevent

bribery and corruption, and the Group is

committed to a zero-tolerance position in

this respect. The Committee is satisfied

that the Group’s procedures with respect

to these matters are adequate.

In accordance with the obligations under

the Reporting on Payment Practices

and Performance Regulations 2017,

the Company has submitted its bi-annual

reports in line with the legislation during

the year.

The Group’s Modern Slavery Statement,

which sets out details of the policies in

relation to slavery and human trafficking,

as well as its due diligence processes

with its partners, has been published at:

investors.eurocell.co.uk.

The Group has also updated its Tax

Strategy Statement, again published

on our website, in compliance with the

Finance Act 2016, which sets out details

of the Group’s attitude to tax planning

and tax risk. In addition, the Group

continues to be certified as an accredited

Fair Tax Mark business, recognising our

responsibility to pay the right amount of

tax, in the right place, at the right time.

External auditor independence

In accordance with best ethical standards,

PricewaterhouseCoopers LLP has

processes in place designed to maintain

independence, including the rotation of the

audit engagement partner at least every

five years. As a result of these processes,

the current audit engagement partner,

Chris Hibbs, assumed full responsibility

from the 2020 audit.

The Committee has also adopted policies

to safeguard the independence of its

external auditors, which are underpinned

by principles that ensure that the external

auditors do not:

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 87

• Audit their own work

• Make management decisions

for the Group

• Create a conflict of interest

• Find themselves in the role of advocate

for the Group.

Any work awarded to the external auditors

with a value of more than £5,000 in

aggregate in any financial year, other than

an audit, requires the specific approval

of the Committee. Where the Committee

perceives that the independence of the

auditors could be compromised, the work

will not be awarded to the auditors.

Details of amounts paid to

PricewaterhouseCoopers LLP (‘PwC’)

for audit and audit-related assurance

services in 2024 are set out on page 140.

The audit-related assurance services

provided during the year were in relation

to the Half-Year Report (£49,600) and

the sustainability targets included in the

Company’s banking facility (£27,500).

During the year, the Committee reviewed

the audit process, the performance of the

auditors and their ongoing independence,

taking into consideration:

• An assessment of the lead audit

partner and the audit team, including

their responses to questions from

theCommittee

• A review of the audit approach, scope,

determination of significant risk areas

and materiality

• The execution of the audit, including the

increased use of technology, and the

audit findings reported

• Input from, and interaction with,

management and communication with,

and support to, the Committee

• The quality of any recommendation

points; and a review of independence,

objectivity, scepticism and their ability

to challenge.

Based on this review, the Committee

concluded that the external audit process

had been run efficiently and that

PricewaterhouseCoopers LLP has been

effective in their role as external auditors.

The Committee is satisfied that the

independence of the external auditors is

not impaired, and the level of fees paid for

non-audit services, details of which are set

out in Note 5 to the Financial Statements,

does not jeopardise their independence.

In 2024, PwC’s audit of the Group’s 2023

Annual Report and Accounts, was chosen

by the FRC for an Audit Quality Review

(‘AQR’), as part of their routine quality

monitoring process. PwC confirmed the

findings of the AQR to the Audit and

Risk Committee at its meeting in March

2025, noting that no significant areas for

improvement, nor any material issues

in relation to the Financial Statements,

were identified in the AQR team’s report.

External auditor appointment

The Audit and Risk Committee has primary

responsibility for making a recommendation

to the Board on the appointment,

reappointment, removal and remuneration

of the external auditors. It keeps under

review the scope and results of the audit,

its cost-effectiveness and the independence

and objectivity of the auditors.

The Group’s current auditors,

PricewaterhouseCoopers LLP were

appointed in April 2015, following the

Company’s IPO in March 2015. As a

result, PricewaterhouseCoopers LLP were

permitted to remain as external auditors

without re-tender for ten years from that

date, until the completion of the 2024

annual audit.

Therefore, the Committee has overseen

a tender process for the appointment of

the Group’s external auditor for the 2025

annual audit. This process was completed

during 2024 so that, in the event of a

change, the incoming firm would have the

opportunity to shadow the 2024 audit.

External auditor tender overview

The objective of the tender was to

select the highest-quality auditor at

an appropriate price. The governance

structure outlined in the table below was

used to ensure a transparent and robust

selection process.

The following key activities were

undertaken as part of the tender:

• An assessment of the UK audit market

and firms’ capabilities resulted in four

firms being invited to participate in

the process, including the incumbent,

PricewaterhouseCoopers LLC

• The four firms were asked to prepare an

RFP document, based on information

made available via an electronic data

room, plus meetings with members of

the Steering Committee

• As well as structured engagement

sessions, the participating firms had

the chance to meet with the CEO,

other members of the executive team

(including the Director of IT) and key

members of the finance team

• The Steering Committee evaluated the RFP

submissions, based on pre-determined

objective criteria consistently applied,

and agreed a shortlist of two firms for

in-person presentations to the Advisory

and Steering Committees

• Following the shortlist firm presentations,

and consideration of relevant transition

arrangements, the Advisory and Steering

Committees agreed Deloitte LLP was the

preferred firm.

At the conclusion of the process, the

Audit and Risk Committee considered the

results of the tender and recommended to

the Board that Deloitte LLP be appointed

as external auditors for the Group, subject

to shareholder approval at the 2025 AGM.

Iraj Amiri

Chair of the Audit

and Risk Committee

19 March 2025

Governance body Key responsibilities

Audit and Risk

Committee

• Ultimate authority over the tender process

• Approve tender strategy, including participating firms

• Recommend selected audit firm to the Board.

Advisory Committee

(Audit Chair, SID)

• Attend shortlisted firm presentations and participation in final selection decision.

Steering Committee

(Audit Chair, CFO plus

key members of the

finance team)

• Design tender process, including request for proposal (‘RFP’) information requirements and evaluation criteria

• Preparation of electronic data room for participating firms

• Meetings with participating firms to support their RFP preparation

• Evaluate RFP submissions and agree firms for shortlist presentation

• Attend shortlisted firm presentations and participation in final selection decision.

Eurocell plc Annual Report and Accounts 202488

Dear shareholder,

I am pleased to report to you on the

main activities of the Committee

and how it has performed its duties

during 2024.

The Committee is responsible for providing

formal and transparent oversight of

the Group’s Environmental, Social and

Governance (‘ESG’) programme and

value-led agenda. This includes, but is not

limited to, sustainability, employee welfare

and responsible business practices,

as well as the Company’s contribution

to the societies in which it operates.

Role and responsibilities

The principal duties of the Committee

areto:

• Drive the social value and

responsiblebusiness agenda on

behalfof the Company

• Ensure that the Company conducts its

business in a commercially responsible

way to achieve maximum positive

impact on the people, communities and

the environment in which it works

• Monitor progress against key

performance indicators and external

ESG index results

• Benefit the customers, staff and

shareholders of the Eurocell Group.

1 Stepped down from the Board 31 July 2024.

2 Appointed 1 February 2024.

3 Stepped down from the Committee

31 December 2024.

4 Appointed 2 January 2024.

Committee composition

Kate Allum

Iraj Amiri Will Truman

Angela

Rushforth

Darren

Waters

Michael

Scott

Colin Hales

Cat

Hambleton-

Gray

Jon Lawrence

As a result, the Committee has the

following objectives to:

• Emphasise the importance of

environmental measures, sustainability

goals and performance, at all levels of

the business

• Provide best practice on the structure,

policies and regulations that impact

thebusiness

• Increase the understanding and

awareness of corporate governance and

social aspects that impact the business

and industry

• Monitor and develop all aspects

ofemployee welfare throughout

thebusiness

• Implement and promote common

and workable standards of corporate

governance for the business

• Provide advice on ESG matters to

management and the Board

• Review and approve/recommend the

Group’s ESG initiatives, objectives,

strategies and targets

• Advise on the reporting and disclosures

on ESG matters in compliance with laws

and regulations.

Social Values and

ESG Committee members

The Committee includes Non-executive

Directors, Executive Directors and

members of the senior management team.

During 2024, the Committee comprised:

Chair:

Alison Littley

Committee members:

Non-executive Directors:

Kate Allum (until 31 July 2024)

Iraj Amiri

Will Truman

Angela Rushforth (from 1 February 2024)

Executive Directors:

Darren Waters

Michael Scott

Senior management team:

Colin Hales (Chief Operating Officer,

to 31 December 2024)

Jon Lawrence (Head of Safety,

Health and Environment)

Cat Hambleton-Gray (People Director,

from 2 January 2024)

All members of the Committee served

throughout the year, unless otherwise stated.

Only members of the Committee have the

right to attend Committee meetings, but

the other members of the Board and, when

appropriate, other members of the senior

management team, are also invited to

attend Committee meetings.

SOCIAL VALUES AND ESG COMMITTEE REPORT

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 89

Summary of activities during

theyear

The Social Values and ESG Committee

met formally three times during the year

and attendance at the meetings is shown

on page 71.

The areas of focus for the Committee in

2024, and up to the date of this Annual

Report, were as follows.

• Review of management reports on safety

performance and improvement initiatives

• Oversight of the ongoing environmental

protection initiatives across the Group

• Review of the approach to, and delivery

of, the People First Strategy

Non-financial and Sustainability Information Statement

The Group has complied with the requirements of sections 414CA and 414CB of the Companies Act 2006 by including certain

non-financial information within the Strategic Report.

The following table summarises where you can find further information on each of the key areas of disclosure required by section

414CA and 414CB of the Companies Act. The Companies (Strategic Report) (Climate-related Financial Disclosure) Regulations

2022 amend these sections of the Companies Act 2006, placing requirements on the Group to incorporate climate disclosures

in the Annual Report. We believe these have been addressed within this year’s climate-related disclosures on pages 40 to 51 and

as such, we have referenced the location of these within our statement on TCFD on page 41.

Relevant Group policies and guidance Relevant principal risks Relevant information from our Annual Report

Environmental

matters

• Safety, Health and Environment Policy

• Sustainable Procurement Policy

• Corporate Social Responsibility Policy.

• Sustainability and

climate change.

• Environmental Leadership:

pages 30 to 33

• Sustainable Products:

pages36 to 37.

Colleagues • Employee Handbook

• Managing Performance Policy

• Equality, Diversity and Inclusion Policy

• Board Diversity Policy.

• Health and safety. • Health and Safety:

pages25 to 26

• People First:

pages 27 to 29.

Social matters • Corporate Social Responsibility Policy

• Privacy policy

• Anti-Bullying, Harassment and

Victimisation Policy

• Whistleblowing Policy

• Safety, Health and Environment Policy

• Recruitment Policy

• Various Information Security Policies

• Sustainable Procurement Policy.

• Cyber security

• Managing change.

• Ethics and Compliance:

pages 38 to 39.

Human rights • Anti-Slavery and Human Trafficking Policy

• Whistleblowing Policy

• Modern Slavery Statement.

• Ethics and Compliance:

pages 38 to 39.

Anti-bribery

and corruption

• Anti-bribery policy. • Ethics and Compliance:

pages 38 to 39.

• Reviewing the Committee Terms

of Reference

• Approval of the Groups Net Zero

Transition Plan

• Approval to submit emission reduction

targets for verification by the Science

Based Targets initiative (‘SBTi’)

• Considered the appropriateness of

ESGmetrics and any associated

assurance requirements

• Overseeing the Groups first submission

to the CDP.

Full details of our work to date on

the development of our ESG strategy

and related matters are set out in the

Sustainability Report on pages 22 to 39

and the Task Force on Climate-related

Financial Disclosures Report on pages

40 to 51.

Our Net Zero Transition Plan can be found

at: investors.eurocell.co.uk.

Finally, I would like to thank my fellow

Committee members who served

duringthe year for their valuable

contribution and support.

Alison Littley

Chair of the Social Values

andESGCommittee

19 March 2025

Eurocell plc Annual Report and Accounts 202490

1 Appointed Committee Chair 1 July 2024.

2 Joined the Committee 1 February 2024.

3 Joined the Committee 1 July 2024.

4 Stepped down as Chair and Member of the

Committee 1 July 2024.

5 Stepped down from the Committee 16 May 2024.

Dear shareholder,

I am pleased to introduce the Directors’

Remuneration Report for 2024, being my

first report since succeeding Kate Allum

as Committee Chair in July 2024.

Throughout the year, the Committee has

endeavoured to balance the experience

of the Company’s stakeholders with its

obligations to ensure remuneration is:

• Competitive to support recruitment

and retention

• Fit to incentivise and fairly reward the

achievement of short and long-term

business goals

• Cascaded appropriately throughout

the business.

I hope the report explains how we have

sought to achieve this aim for the year in

review and, following an extensive consultation

process, how we have arrived at the proposed

policy for the next three years, for which we

will seek approval at the coming AGM.

For the year in review, as described

elsewhere in this Annual Report, the Group

delivered a resilient financial performance

against a weak market backdrop. The

performance outturn delivered would

ordinarily have warranted a bonus

payment based on a partial achievement

of the targets set at the start of the year.

However, despite the Group’s solid cash

flow performance, the Executive Directors

proposed that no bonus should be paid in

relation to profit performance. Whilst the cash

flow performance (which was at 102% of the

target set at the start of the year) warranted

a payment of 82% of the maximum

available for that performance element,

the Committee exercised its discretion

to scale back the payment to reflect its

assessment of the broader performance

context. The Committee approved a fixed

payment of £15k to each of the Executive

Directors, consistent with the approach

taken for determining other payments

under the scheme this year. This context

has framed the Committee’s assessment

of 2024 incentive outcomes, further details

of which are set out later in this report.

Looking ahead, we are asking

shareholders to approve a new

Remuneration Policy at the AGM on

15 May 2025. The current policy expires

at that time, having been approved by

shareholders at the 2022 AGM. The

review of the policy has been a key focus

for the Committee during 2024, as we

undertook to ensure that our approach

to executive remuneration over the next

policy term directly reinforces the Group’s

ambitious growth strategy outlined last

year. Our proposals, and the background

to these, are explained in this report. On

behalf of the Committee, I would like to

thank investors for their time in engaging

on this matter, the constructive feedback,

which informed our final approach, and the

support indicated for the proposal.

Further details on the policy review process,

and the proposed new policy, can be found

on pages 92 to 100 of this report.

In line with prior years, we will also offer

a resolution on an advisory basis on the

Directors’ Remuneration Report (excluding

Part A: Directors’ Remuneration Policy).

This year, there will also be separate

resolutions to approve the rules of the

Performance Share Plan and the Deferred

Share Plan, to enable us to implement

the policy proposals in 2025 and beyond.

I hope that we have succeeded in setting

out clearly our proposals and the rationale

for these, and can count on your support

for the remuneration-related resolutions at

the 2025 AGM.

I would also like to thank my fellow

Committee members and external

advisersfor their valuable contributions

during the year.

Alison Littley

Chair of the Remuneration

Committee

19 March 2025

DIRECTORS’ REMUNERATION REPORT

Committee composition

Alison Littley

Iraj Amiri Angela

Rushforth

Will Truman

Kate Allum

Frank Nelson

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 91

Role and responsibilities

The Committee’s principal

responsibilities are to:

• Recommend to the Board the

remuneration strategy and

framework for the Executive

Directors and senior managers

• Determine, within that framework,

the individual remuneration

arrangements for the Executive

Directors and senior managers

• Determine the remuneration

for the Chair

• Oversee any major changes

in colleague benefit structures

throughout the Group.

Proposed Remuneration Policy

In conjunction with our external adviser, a

detailed review of the Remuneration Policy

was performed by the Committee during

the year. This process involved reviewing

the current policy in the context of our

business strategy, pay and conditions

in the wider workforce and market

practice. In addition, potential conflicts of

interest were considered in line with the

requirements of the Companies Act 2006.

The existing policy was approved by 100%

of shareholders at the 2022 AGM and

expires in 2025. The policy has remained

broadly unchanged for a number of years

and, while it reflects typical market norms

for FTSE Executive Director remuneration,

the Committee determined from its review

that a different approach is merited for

the next policy term to more directly

reinforce the Group’s strategic ambition

to grow revenues to £500 million and

generate profits of £50 million by improving

margin to 10%, by 2028. Therefore,

in late 2024, we consulted extensively

with shareholders on a proposed policy

incorporating the following changes,

to sharpen the link of executive pay

outcomes to Company performance and

directly align the Executive Directors and

wider senior leadership team with the

delivery of the strategy that the business

has committed to deliver. Thereby the new

policy will:

• Increase the bonus opportunity for

the CEO to 150% of salary, to deliver

a short-term remuneration opportunity

that reflects the calibre and performance

track record of our well-regarded CEO,

whilst maintaining a below-market base

salary positioning, consistent with our

philosophy of upweighting variable

remuneration over fixed pay.

No change is proposed to the CFO’s

bonus opportunity (100% of salary).

• Strengthen bonus deferral, while

an Executive Director is building a

shareholding in Eurocell, by mandating

that 50% of any bonus earned be

deferred into shares for three years.

Currently, only bonus earned in excess of

75% of salary is required to be deferred.

This strengthened requirement supports

the principle of alignment with shareholder

interests through exposure to the share

price. Once the in-post shareholding

guideline has been met, whether by

purchases in the market or retaining

vested share-based remuneration, it is

proposed that the mandatory deferral

requirement be relaxed and any bonus

earned paid entirely in cash.

Summary of activities during theyear

The Remuneration Committee met formally

3 times during the year and attendance at

the meetings is shown on page 71.

The main Committee activities during the

year (full details of which are set out in the

relevant sections of this report) included:

• Assessing performance against the

targets set, and the resulting pay-out of,

the 2023 annual bonus

• Agreeing Executive Director and

senior management base salaries from

1 April 2024

• Setting the performance targets for the

2024 annual bonus

• Agreeing the award levels and targets

for the 2024 Performance Share Plan

(‘PSP’) awards

• Reviewing the pay and benefits structure

of the wider workforce to ensure

alignment with the Executive Directors

and senior management

• Reviewing the policy and extensively

engaging shareholders before finalising

its proposal

• Reviewing our gender pay gap reporting

• Overseeing the operation of the Group’s

Save As You Earn scheme

• Reviewing the Committee Terms

of Reference

• Reviewing its advisers and appointing

Ellason LLP as independent

remuneration consultants to the Group,

with effect from August 2024.

• Grant a one-off, four-year PSP in

2025 aligned with the remainder

of the five-year term of our

stated strategic ambition. Award

opportunities will be set at 800% of

base salary (equivalent to 200% of

base salary per annum) for our CEO,

and 600% of base salary for our CFO

(equivalent to the existing opportunity of

150% of base salary on an annualised

basis). The scorecard will comprise

the three KPIs of our strategy: revenue

(weighted 25%); profit (50%); and

margin (25%). The Committee will

also retain the discretionary powers

already available, to review the

formulaic outcome and adjust this, if

necessary, to ensure it reflects Eurocell’s

underlying performance. This will

include the quality of earnings, the

impact of transformational M&A and

the stakeholder experience, thereby

also avoiding any windfall gains. To the

extent the award vests, 50% will be

subject to a further one-year holding

period. No further PSP awards will be

made to Darren Waters and Michael

Scott until 2029.

Our proposals seek to strengthen further

the alignment of executive remuneration

to shareholder value creation and

stakeholders’ experience, and to strike a

balance between being highly motivational

whilst appropriately competitive for relevant

talent markets and other FTSE Main Market

companies of comparable sector, scale

and complexity to Eurocell. In that context,

the Committee welcomed the feedback

received during an extensive engagement

process in Q4 2024 with shareholders

representing c.67% of issued share capital.

The support indicated, and the feedback

and views received, informed our decision

to proceed with submitting the revised

policy, set out on pages 92 to 100, for

shareholder approval at the 2025 AGM.

The Committee also welcomed

shareholders’ constructive challenge and

expectation that targets for the 2025 PSP

be set to be appropriately challenging, with

appropriate safeguards against ‘paying

for failure’ implemented. The Committee

supports these principles, and this helpful

input informed our decision making on

how we will implement the Remuneration

Policy for 2025, as set out on page 100

of this report.

Eurocell plc Annual Report and Accounts 202492

DIRECTORS’ REMUNERATION REPORT CONTINUED

2024 remuneration outcomes

2024 Annual Bonus Plan

Adjusted profit before tax was up 32% at

£20.0 million (2023: £15.2 million), driven

by proactive gross margin management

and reduced input costs. However, this

result has been achieved before taking into

consideration the cost of any associated

bonus pay-out.

Including the cost of an on-target outcome

for the profit element of the Annual Bonus

Plan for all scheme participants would reduce

the profit outcome to a below-threshold level.

The Committee, therefore, determined, at

the request of the Executive Directors, that

no bonus would be payable in connection

with the profit element of the plan.

Adjusted cash generated from operations

was solid at £49.1 million, compared to

£57.4 million in 2023, with the comparative

period including a reduction in stocks of

c.£13 million. This performance results in

an achievement of 102% of the cash flow

target set for this element of the plan.

After the appropriate weightings are

applied, this would ordinarily provide for

an overall pay-out of 25% of salary being

awarded to the Executive Directors.

However, the Committee elected to

exercise its discretion to scale back the

payment to reflect its assessment of

the broader performance context. The

Committee approved a fixed payment of

£15k to each of the Executive Directors,

consistent with the approach taken for

determining other payments under the

scheme this year.

Further details can be found on page 103

of this report.

PSP awards granted in 2022

Adjusted basic earnings per share

(‘EPS’) for the year was 14.4 pence

(2023: 11.0 pence).

Return on capital employed (‘ROCE’)

at 31 December 2024 was 16.9%

(2023: 12.6%).

As a result of this performance, the PSP

awards granted in 2022 will lapse in full in

2025, further details of which can be found

on page 104 of this report.

As in previous years, annual PSP awards

were made during 2024, with targets again

based on EPS and ROCE, and further

details can be found on page 104.

Implementation of the Remuneration

Policy in 2024 and 2025

The Committee considers the

Remuneration Policy has operated as

intended in 2024. However, during its

review of the policy prior to submitting

this for approval at our 2025 AGM, the

Committee determined that it would be

appropriate to more closely align the

structure, measures and targets of our

short and long-term incentive opportunities

to our stated strategic priorities announced

in 2024. Further details on how we propose

to implement the new policy, subject to

approval by shareholders at the AGM, are

included within Part B: The Annual Report

on Remuneration on pages 101 to 111.

The Committee believes its approach

takes due account of market and best

practice and, importantly, also reflects and

supports Eurocell’s strategy and promotes

the Company’s long-term success.

Remuneration Policy links

tostrategy

The Group’s five-year strategy was first

set out in the 2023 Annual Report, with a

full progress update included in this year’s

report on pages 14 to 21.

As described, the current Remuneration

Policy reflects typical market norms, with, the

measures used in the annual bonus selected

by the Committee to reinforce our short-term

operational priorities. Long-term performance

measures are selected to align with our

strategic ambitions and targets typically

reflect industry context, expectations of

what will constitute appropriately challenging

performance levels and factors specific to

the Group.

Explanatory foreword

This report contains the material

required to be set out as the Directors’

Remuneration Report for the purposes

of Part 4 of The Large and Medium-sized

Companies and Groups (Accounts and

Reports) (Amendment) Regulations 2013

and is split into two parts as follows.

Part A: The Directors’ Remuneration

Policy – this sets out the proposed

Remuneration Policy for which shareholder

approval will be sought at the 2025 AGM,

given that Eurocell has reached the end of

its three-year shareholder-approved policy

period. Our current Directors’ Remuneration

Policy, which was approved by shareholders

at the 2022 AGM, was disclosed fully in the

2021 Annual Report and is also available at:

investors.eurocell.co.uk. This Part A sets out

the proposed policy and will be subject to a

binding vote at the 2025 AGM.

Part B: The Annual Report on

Remuneration – this sets out payments

and awards made to the Directors

and details the link between Company

performance and remuneration for

2024 and how the proposed policy will

be operated for 2025. The Directors’

Remuneration Report (excluding Part A:

Directors’ Remuneration Policy) subject

to an advisory vote at the AGM.

The auditors have reported on

certain parts of the Annual Report on

Remuneration and stated whether,

in their opinion, those parts have been

properly prepared in accordance with

the Companies Act 2006. Those parts,

which have been subject to audit, are

clearly indicated.

PART A:

DIRECTORS’

REMUNERATION

POLICY

Policy scope

The policy applies to the Chair of

the Board, Executive Directors and

Non-executive Directors.

Policy duration

Subject to being approved by

shareholders at the 2025 AGM, the

Directors’ Remuneration Policy shall

apply from the date of until the end

of the financial year in which the third

anniversary of its approval falls.

Changes from the 2021

Remuneration Policy

Following a detailed review, the

Committee is proposing a revised policy

to more directly reinforce Eurocell’s

ambitious growth strategy and further

strengthen the alignment of executive

and stakeholder interests. The proposed

changes (and rationale for them) are

described in the Chair’s letter at the start

of this report and, along with other minor

revisions being proposed to the policy,

are highlighted in the following table.

The Committee consulted shareholders

representing c.67% of issued share

capital on its proposals and took into

account their views when finalising the

policy. Further details are set out in the

‘consideration of shareholder views’

section later in this Part A.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 93

Executive Directors

The following table summarises the key aspects of the Directors’ Remuneration Policy:

Element and purpose Policy and operation Maximum Performance measures

Base salary

This is the core

element of pay

and reflects the

individual’s role and

position within the

Group, with some

adjustment to reflect

their capability

andcontribution.

Base salaries will be reviewed each year

by the Committee.

The Committee does not strictly follow

data but uses the median position (as

against appropriate size and/or sector

peers) as a reference point in considering,

in its judgement, the appropriate level

of salary having regard to other relevant

factors including corporate and individual

performance and any changes in an

individual’s role and responsibilities.

Base salary is normally paid monthly in cash.

It is anticipated that salary

increases will generally be in line

with those awarded to salaried

employees. However, in certain

circumstances (including,

but not limited to, changes

in role and responsibilities,

market levels, individual and

Company performance), the

Committee may make larger

salary increases to ensure they

are market competitive. The

rationale for any such increase

will be disclosed in the relevant

Annual Report on Remuneration.

n/a

Benefits

To provide

benefitsvalued

byrecipients.

The Executive Directors can receive a car

allowance or Company car (and fuel), private

family medical cover, permanent health

insurance and life assurance.

The Committee reserves discretion to

introduce new benefits where it concludes

that it is appropriate to do so, having regard

to the particular circumstances and to

market practice.

Where appropriate, the Company will

meetcertain costs relating to Executive

Director relocations.

It is not possible to prescribe

the likely change in the cost

of insured benefits or the cost

of some of the other reported

benefits year to year, but the

provision of benefits will operate

within an annual limit of £100,000

(plus a further 100% of base

salary in the case of relocations).

The Committee will monitor the

costs of benefits in practice

and will ensure that the overall

costs do not increase by more

than the Committee considers

appropriate in the circumstances.

n/a

Pension

To provide

retirement benefits.

Executive Directors can receive pension

contributions to personal pension

arrangementsor, if a Director is impacted

by annual or lifetime limits on contribution

levels to qualifying pension plans, the

balance can bepaid as a cash supplement.

The maximum employer’s

contribution (or cash

supplement) for incumbent

Executive Directors is, and

for new appointments will

be, aligned with the pension

benefits available to the wider

workforce, currently 5% of

base salary.

n/a

Eurocell plc Annual Report and Accounts 202494

Element and purpose Policy and operation Maximum Performance measures

Annual Bonus Plan

To motivate

executives and

incentivise delivery of

performance over a

one-year operating

cycle, focusing

on the short to

medium-term

elements of our

strategic aims.

Annual Bonus Plan levels and the

appropriateness of measures are reviewed

annually at the commencement of each

financial year to ensure they continue to

support our strategy.

From the 2025 Annual Bonus Plan cycle

onwards, 50% of any earned award will

be compulsorily deferred into Eurocell

shares under the Company’s Deferred

Share Plan (‘DSP’), for three years from

grant. To the extent an Executive Director

has achieved, and continues to meet,

their share ownership guideline, the

deferral requirement shall cease to apply

and subsequent earned awards will be

paid in cash.

The number of shares subject to vested

DSP awards may be increased to reflect the

value of dividends that would have been paid

in respect of any ex-dividend dates falling

between the grant of awards and the expiry

of the deferral period.

Malus and clawback provisions apply to the

Annual Bonus Plan and DSP, as explained

within this report.

150% of base salary for the

Chief Executive Officer.

100% of base salary for other

Executive Directors.

The performance measures

applied may be financial or

non-financial and corporate,

divisional or individual

and in such proportions

as the Committee

considersappropriate.

Once set, performance

measures and targets will

generally remain unchanged

for the year, except to

reflectevents such as

corporate acquisitions or

other significant events

where the Committee

considers it to be necessary

in its opinion to make

appropriate adjustments.

Attaining the threshold level

of performance for any

measure will not produce a

pay-out of more than 20%

of that element of the overall

opportunity attributable to

that measure.

However, the Annual

Bonus Plan remains a

discretionary arrangement,

and the Committee

retains a standard power

to apply its judgement to

adjust the outcome of the

Annual Bonus Plan for any

performance measure

(from zero to any cap)

should it consider that

to be appropriate.

DIRECTORS’ REMUNERATION REPORT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 95

Element and purpose Policy and operation Maximum Performance measures

Long-term

incentives

To motivate and

incentivise delivery

of sustained

performance over

the long term, and to

promote alignment

with shareholders’

interests.

Awards under the PSP take the form of

nil-cost options, which vest to the extent

performance conditions are satisfied over

a period of at least three years.

The number of shares subject to vested

PSP awards may be increased to reflect the

value of dividends that would have been paid

in respect of any ex-dividend dates falling

between the grant of awards and the expiry of

the vesting period (or at the end of any holding

period in respect of unexercised awards).

A post-vesting holding period applies to PSP

awards. For the 2025 PSP, a post-vesting

holding period of one year will apply to 50%

of any shares vesting at the conclusion of the

4-year performance period. For any other

PSPawards granted to Executive Directors

during the policy term (as may be required

fornew appointments), a post-vesting

holdingperiod of two years will apply to

100%of any shares vesting.

Malus and clawback provisions apply to PSP

awards, as explained within this report.

For 2025 only:

• an award opportunity of

800% of base salary for

Darren Waters; and

• an award opportunity of

600% of base salary for

Michael Scott.

Future years:

No further awards will be

made to Darren Waters or

Michael Scott until 2029.

Annual awards (e.g. in the

event of a new Executive

Director appointment during

the policy term) may be made

up to 200% of base salary.

The Committee expressly

reserves discretion to make

such awards as it considers

appropriate within this limit.

The Committee may set such

performance conditions on

PSP awards as it considers

appropriate (whether

financial or non-financial

and whether corporate,

divisional or individual).

Performance periods may

be over such periods as the

Committee selects at grant,

which will not normally

be less than (but may be

longer than) three years.

No more than 25% of

awards vest for attaining

the threshold level of

performance conditions.

The Committee also has

standard power to exercise

discretion to adjust the

outcome of the PSP for

any performance measure

(from zero to any cap)

should it consider that to

be appropriate.

Share ownership

guidelines

To further align the

interests of Executive

Directors with those

of shareholders.

Executive Directors are required to retain at

least 50% of the net of tax shares, which

vest under the PSP and DSP awards until

the guideline (being 200% of base salary) is

met. Any PSP shares, which are performance

vested but subject to a holding period, and

any shares awarded in connection with annual

bonus deferral, will be credited for the purpose

of the guidelines (discounted for anticipated

tax liabilities).

Executive Directors are required to maintain a

shareholding in the Company for a one-year

period after stepping down from that position,

being 100% of base salary or the Executive

Directors’ actual relevant shareholding at

leaving this position, if lower.

The Executive Directors’ actual relevant

shareholding will include shares vesting under

any of the Company’s discretionary share

incentive arrangements (including any deferred

bonus shares) from awards granted after

12 May 2022, but excludes shares acquired

through purchase and the release of shares

under share incentive plans where the grant

occurred prior to 12 May 2022.

n/a n/a

Eurocell plc Annual Report and Accounts 202496

DIRECTORS’ REMUNERATION REPORT CONTINUED

Element and purpose Policy and operation Maximum Performance measures

All-employee

shareplans

To encourage

share ownership by

employees, thereby

allowing them to

share in the

long-term success

of the Group

and align their

interests with those

ofshareholders.

These are all-employee share plans established

under HMRC tax-advantaged regimes and

follow the usual form for such plans.

Executive Directors will be able to participate

in all-employee share plans on the same terms

as other Group employees.

The maximum participation levels

for all-employee share plans will

be the limits for such plans set

by HMRC from time to time.

Consistent with normal

practice, such awards

will not be subject to

performance conditions.

Chair/

Non-executive

Director fees

To enable the

Company to recruit

and retain Chairs

and Non-executive

Directors of the

highest calibre, at the

appropriate cost.

The fees paid to the Chair and Non-executive

Directors aim to be competitive with other listed

companies of equivalent size and complexity.

The fees payable to the Non-executive

Directors are determined by the Board, with the

Chair’s fees determined by the Remuneration

Committee. Fees are paid monthly in cash.

The Chair and Non-executive Directors

willnotparticipate in any cash or share

incentive arrangements.

The Company reserves the right to provide

benefits (including travel and office support) to

the Chair and Non-executive Directors where

appropriate. Should any assessment to tax be

made on such reimbursement, the Company

reserves the ability to settle such liability on

behalf of the Non-executive Director.

The aggregate fees (and any

benefits) of the Chair and

Non-executive Directors will not

exceed the limit from time to time

prescribed within the Company’s

Articles of Association.

If the Chair and/or Non-executive

Directors devote special

attention to the business of the

Company or otherwise perform

services, which in the opinion

of the Directors, are outside the

scope of the ordinary duties of

aDirector, they may be paid

such additional remuneration

asthe Directors or any

Committee authorised by the

Directors may determine.

n/a

Other elements of the policy and notes to the policy table

Performance targets

Targets applying to the annual bonus and PSP are set at the start of each award cycle, taking into account a number of internal and

external reference points.

Annual bonus targets, which may change from year to year, are aligned with the annual budget agreed by the Board and measures will

be selected by the Committee to reinforce short-term operational priorities. While commercially sensitive at the time of being agreed,

bonus targets will be disclosed retrospectively in the relevant Annual Report.

PSP targets typically reflect industry context, expectations of what will constitute appropriately challenging performance levels and

factors specific to the Group. For the four-year PSP proposed for approval at the 2025 AGM, measures and targets have been

aligned directly to the KPIs of our five-year strategy published in the 2023 Annual Report.

Malus and clawback

Malus (being the forfeiture of unpaid or unvested awards) and clawback (being the ability of the Company to claim repayment of paid

amounts) provisions apply to the Annual Bonus Plan, DSP and PSP in certain circumstances (e.g. material misstatement of accounts,

miscalculation of vesting/pay-outs and conduct that would or could justify summary dismissal). Normally, clawback can operate for up

to three years following the vesting of an award. This timeframe has been set by the Committee to align with the period over which the

Company’s processes and systems are likely to uncover any of the trigger events listed above.

Differences between the policy on remuneration for Directors and remuneration of other employees

While the appropriate benchmarks vary by role, the Company seeks to apply the philosophy behind this policy across the Company

as a whole. This includes the basis on which the wider senior leadership team is incentivised and, accordingly, the PSP structure,

measures and targets outlined above will be cascaded to all eligible participants.

Where Eurocell’s pay policy for Directors differs from its pay policies for groups of employees, this reflects the appropriate market rate

position and/or typical practice for the relevant roles. The Company takes into account pay levels, the bonus opportunity and share

award opportunity applied across the Group as a whole when setting the Executive Directors’ Remuneration Policy.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 97

Committee discretions

The Committee will operate the Annual Bonus Plan, DSP and

PSP according to their respective rules and the policy table.

The Committee retains discretion, consistent with market

practice, in a number of respects, in relation to the operation

and administration of these plans. These discretions include,

but are not limited to, the following:

• the selection of participants;

• the timing of grant of an award/bonus opportunity;

• the timing of vesting of an award/bonus opportunity;

• the size of an award/bonus opportunity subject to the

maximum limits set out in the policy;

• the determination of the extent to which performance

targets are satisfied and the resultant vesting/bonus

pay-outs;

• discretion required when dealing with a change of control

or restructuring of the Group;

• determination of the treatment of leavers based on the

rules of the plan and the appropriate treatment chosen;

• adjustments required in certain circumstances (e.g. rights

issues, corporate restructuring events and special dividends);

• the annual review of performance measures, weightings

and targets from year to year; and

• application of malus and/or clawback provisions.

In addition, while performance measures and targets used

in the Annual Bonus Plan and PSP will generally remain

unaltered, if events occur which, in the Committee’s opinion,

would make a different or amended target a fairer measure

of performance, such amended or different target can be

set, provided it is not materially more or less difficult to satisfy

(having regard to the event in question).

Any use of these discretions would, where relevant,

be explained in the Directors’ Remuneration Report and

may, where appropriate and practicable, be the subject

of consultation with the Company’s major shareholders.

In addition, for the avoidance of doubt, in approving this

policy, authority is given to the Company to honour any

commitments entered into with current or former Directors

under previous policies.

The Committee may make minor amendments to the policy

(for regulatory, change of control, tax or administrative

purposes or to take account of a change in legislation)

without obtaining shareholder approval for that amendment.

Recruitment remuneration policy

The Company’s recruitment remuneration policy aims to give

the Committee sufficient flexibility to secure the appointment

and promotion of high-calibre executives to strengthen the

management team and secure the skillset necessary to

deliver our strategic aims.

In terms of the principles for setting a package for a new

Executive Director, the starting point for the Committee will

be to apply the general policy for Executive Directors as set

out and structure a package in accordance with that policy.

Any caps contained within the policy for fixed pay do not

apply to new recruits, although the Committee would not

envisage exceeding these caps in practice.

The Annual Bonus Plan, DSP and PSP will operate (including

the maximum award levels) as detailed in the general policy

in relation to any newly appointed Executive Director. For an

internal appointment, any variable pay element awarded in

respect of the prior role may either continue on its original terms

or be adjusted to reflect the new appointment as appropriate.

For external and internal appointments, the Committee may

agree that the Company will meet certain relocation expenses

as it considers appropriate.

For external candidates, it may be necessary to make

additional awards in connection with the recruitment to buy

out awards forfeited by the individual on leaving a previous

employer. While buy-out awards are not subject to a formal

cap, the Company will not pay more than is, in the view of the

Committee, necessary and will in all cases seek, in the first

instance, to deliver any such awards under the terms of the

existing Annual Bonus Plan, DSP or PSP. It may, however,

be necessary in some cases to make buy-out awards on

terms that are more bespoke than the existing schemes.

The structure and award opportunity under any buy-out

arrangement, whether delivered under the Annual Bonus

Plan, DSP, PSP or otherwise, will take due account of the

service obligations and performance requirements for the

remuneration relinquished by the individual when leaving

a previous employer. The Committee will seek (where it is

practicable to do so) to make buy-outs subject to what are,

in its opinion, comparable requirements in respect of service

and performance. However, the Committee may choose

to relax this requirement in certain cases (such as where

the service and/or performance requirements are materially

completed, or where such factors are, in the view of the

Committee, reflected in some other way, such as a significant

discount to the face value of the awards forfeited) and where

it is considered to be in the interests of shareholders to do so.

A new Chair/Non-executive Director would be recruited on

the terms explained above in respect of the main policy for

such Directors.

Eurocell plc Annual Report and Accounts 202498

Service contracts

Executive Directors

The Committee’s policy is that each Executive Director’s service agreement should be of indefinite duration, subject to termination

upon no more than 12 months’ notice by either party. The service agreements of both Executive Directors comply with that policy.

Contracts contain provisions allowing the Company to make payments in lieu of notice (albeit not including bonus or benefits) but

do not contain change of control provisions.

The Committee reserves flexibility to alter these principles, if necessary, to secure the recruitment of an appropriate candidate

including, if appropriate, a longer initial notice period (of up to two years) reducing over time.

The date of each current Executive Director’s contract is:

Darren Waters 11 April 2023

Michael Scott 1 September 2016

Chair/Non-executive Directors

The Chair and each Non-executive Director is engaged for an initial period of three years. These appointments can be renewed

following the initial three-year term. These engagements can be terminated by either party on 12 months’ notice.

Neither the Chair nor any Non-executive Directors can participate in the Company’s incentive plans, are not entitled to any pension

benefits and are not entitled to any payment in compensation for early termination of their appointment beyond the 12 months’ notice

referred to above. The details of the appointments of the current Non-executive Directors are as follows:

Name Date of original appointment Date of latest appointment Term

Derek Mapp 16 May 2022 16 May 2022 3 years

Alison Littley 1 July 2022 1 July 2022 3 years

Iraj Amiri 7 November 2022 7 November 2022 3 years

Will Truman 11 May 2023 11 May 2023 3 years

Angela Rushforth 1 February 2024 1 February 2024 3 years

The Directors’ service agreements and letters of appointment are available for shareholders to view from the Group Company

Secretary on request.

DIRECTORS’ REMUNERATION REPORT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 99

Termination/change of control policy summary

It is appropriate for the Committee to consider treatments on a termination having regard to all of the relevant facts and circumstances

available at that time. This policy applies both to any negotiations linked to notice periods on a termination and any treatments that

the Committee may choose to apply under the discretions available to it under the terms of the Annual Bonus Plan, DSP and PSP.

The potential treatments on termination under these plans are summarised in the table below:

Incentives

If a leaver is deemed to be a ‘good leaver’;

for example, leaving through injury, ill-health,

disability, retirement, redundancy, sale of business

or otherwise at the discretion of the Committee

If a leaver is not

a ‘good leaver’ Change in control

Annual bonus The Committee has discretion to determine an

annual bonus, which may be limited to the period

actually worked.

Annual bonus

generally not paid.

The Committee has discretion

to determine an annual bonus.

DSP Awards normally vest either on the normal vesting

date or cessation. The Committee can pro-rate

awards if considered appropriate.

All awards will

normally lapse.

Awards vest on a pro rata

basis, unless the Committee

determines not to pro-rate.

PSP Awards usually subsist, subject to being pro-rated

for time and the application of the performance

conditions at the end of the normal performance

period.

The Committee retains standard discretions to

either vary/disapply time pro-rating or to accelerate

vesting to the earlier date of cessation (assessing

the performance conditions at that time).

All awards will

normally lapse.

Will receive a time pro-rated

award subject to the application

of the performance conditions

at the date of the event, unless

the Committee determines not

to pro-rate for time.

Annual Bonus Plan, DSP and PSP awards typically vest immediately and in full upon death (although pro-rating may be applied,

depending on the circumstances).

The Company has the power to enter into settlement agreements with Directors and to pay compensation to settle potential legal

claims. In addition, and consistent with market practice, in the event of the termination of an Executive Director, the Company may

make a contribution towards that individual’s legal fees and fees for outplacement services as part of a negotiated settlement.

Any such fees will be disclosed as part of the detail of termination arrangements. For the avoidance of doubt, the policy does not

include an explicit cap on the cost of termination payments.

External appointments

The Company’s policy is to permit an Executive Director to serve as a Non-executive Director elsewhere when this does not conflict

with the individual’s duties to the Company. Where an Executive Director takes such a role, they will be entitled to retain any fees that

they earn from that appointment (unless the Committee determines otherwise).

Statement of consideration of employment conditions elsewhere in the Group

Pay and employment conditions generally in the Group are taken into account when setting Executive Directors’ remuneration.

The Committee receives regular updates on overall pay and conditions in the Group, including (but not limited to) changes in base

pay and any staff bonus pools in operation, and uses this information to ensure consistency and fairness of approach throughout the

Group. As a result, the Committee does not consider it necessary to formally consult with colleagues when drawing up the policy,

determining how the policy will be implemented, or in preparing the Remuneration Report. However, it is intended that annual colleague

engagement surveys would include coverage of relevant aspects of the Group’s remuneration approach, to the extent this is considered

appropriate in the circumstances.

Statement of consideration of shareholder views

When determining executives’ remuneration, the Committee takes into account views of shareholders and best practice guidelines

issued by institutional shareholder bodies. The Committee is always open to feedback from shareholders on remuneration policy and

arrangements, and commits to undergoing shareholder consultation in advance of any significant changes to remuneration policy.

In developing the policy set out in this report, we engaged with shareholders representing c.67% of our issued share capital. We had

a high level of engagement and welcomed the broad indications of support for our proposals, which shareholders acknowledged

closely align with our stated strategy, in terms of timeframe and scorecard measures.

The Committee will continue to monitor trends and developments in corporate governance and market practice to ensure that the

structure of the executive remuneration remains appropriate.

Eurocell plc Annual Report and Accounts 2024100

Share price growth

PSP

Annual bonus

Fixed pay

£474k

£1,017k

£1,996k

£2,431k

2000

2200

2400

2600

1800

1600

140 0

1200

1000

800

600

400

200

£000

CEO CFO

21%

100% 47%

32%

24%

33%

43%

19%

27%

32%

22%

£347k

£701k

£1,133k

£1,368k

100% 50%

33%

17%

31%

28%

41%

25%

23%

35%

17%

Minimum Target Maximum Maximum

with share

price growth

Minimum Target Maximum Maximum

with share

price growth

Illustrations of application of Remuneration Policy

The charts below aim to show how the Remuneration Policy for Executive Directors will be applied in 2025 using the assumptions in

the table below.

Minimum • Consists of base salary, benefits and pension

• Base salary is the salary to be paid with effect from 1 April 2025

• Estimated value of a full-year’s benefits, including car (and fuel) or car allowance, private family medical

cover, permanent health insurance and travel insurance

• Pension measured as the cash allowance in lieu of Company contributions at 5% of base salary.

Base salary Benefits Pension Total fixed

Darren Waters £434,928 £17,075 £21,746 £473,749

Michael Scott £314,244 £17,075 £15,712 £347,031

Target • Annual bonus: consists of an assumed payment of 50% of maximum opportunity

• Long-term incentives: threshold vesting (25% of maximum) of the 2025 PSP opportunity proposed

for approval at the 2025 AGM (annualised to reflect the one-off nature of the four-year scheme).

Maximum Based on the maximum remuneration receivable (excluding share price appreciation and dividends):

• Annual bonus: consists of maximum bonus of 100% of base salary

• Long-term incentives: 100% vesting of the 2025 PSP opportunity (annualised to reflect the one-off

nature of the four-year scheme).

Maximum with

share price growth

• As per the ‘maximum’ scenario, but with a 50% share price growth assumption for the PSP awards.

DIRECTORS’ REMUNERATION REPORT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 101

PART B:

THE ANNUAL REPORT ON REMUNERATION

The Committee (unaudited)

Remuneration Committee members

During 2024, the Remuneration Committee comprised:

Chair:

Alison Littley (from 1 July 2024, member since 15 May 2023)

Kate Allum (to 1 July 2024)

Committee members:

Frank Nelson (until 16 May 2024)

Iraj Amiri

Angela Rushforth (from 1 February 2024)

Will Truman (from 1 July 2024)

All members of the Committee served throughout the year, unless otherwise stated.

The Chief Executive and Chief Financial Officer are invited to attend meetings of the Committee, except when their own remuneration

is being discussed, and other Executives and Non-executive Directors attend meetings as required.

The Committee has formal Terms of Reference, which can be viewed on the Company’s website at: investors.eurocell.co.uk.

During the year, the Committee considered its obligations under the Code and concluded that:

• The Directors’ Remuneration Policy supports the Company’s strategy (including in the performance measures chosen)

• Remuneration for our Directors remains appropriate.

In addition, the Committee has ensured that the Directors’ Remuneration Policy in force for 2024 and our practices

in the year are consistent with the six factors set out in Provision 40 of the 2018 UK Corporate Governance Code:

Clarity – Our Directors’ Remuneration Policy is well understood by our senior executive team and has been clearly articulated to our

shareholders and representative bodies (both on an ongoing basis and during a consultation when changes are being proposed).

Simplicity – The Committee is mindful of the need to avoid overly complex remuneration structures which can be misunderstood and

deliver unintended outcomes. Therefore, a key objective of the Committee is to ensure that our Directors’ Remuneration Policy and

practices are straightforward to communicate and operate.

Risk – Our Directors’ Remuneration Policy has been designed to ensure that inappropriate risk-taking is discouraged and will not

be rewarded via (i) the balanced use of both annual incentives and long-term incentives which employ a blend of targets, (ii) the

significant role played by shares in our incentive plans (together with bonus deferral and shareholding guidelines) and (iii) malus/

clawback provisions within all our incentive plans.

Predictability – Our incentive plans are subject to individual caps, with our share plans also subject to standard dilution limits. The use

of shares within our incentive plans results in the actual pay received being closely aligned to the experience of our shareholders.

Proportionality – There is a clear link between individual awards, delivery of strategy and our long-term performance. In addition,

the significant role played by variable pay, together with the composition of the Executive Directors’ service contracts, ensures that

poor performance is not rewarded.

Alignment to culture – Our executive pay policies are fully aligned to the Company’s culture through the use of metrics in both the

annual bonus and PSP that measure how we perform against key aspects of our strategy.

Committee advisers

FIT Remuneration Consultants LLP (‘FIT’) were the Committee’s appointed advisers until July 2024 and, during that period, provided

advice to the Committee on all matters relating to remuneration, including best practice. FIT’s fees in respect of 2024 were £14,880

(excluding VAT). FIT’s fees were charged on the basis of the firm’s standard terms of business for advice provided.

The Remuneration Committee oversaw and approved the appointment of Ellason LLP (‘Ellason’) to the role of consultant to the

Committee in August 2024. Ellason has no connection with the Group or any individual Director and provided no other services

to theGroup and, therefore, the Committee was satisfied that the advice provided by Ellason was objective and independent.

Ellason’sfees in respect of 2024 were £17,850 (excluding VAT) and were charged on the basis of the firm’s standard terms of

business for advice provided.

Both FIT and Ellason are signatories to the Remuneration Consultants Group’s Code of Conduct.

Eurocell plc Annual Report and Accounts 2024102

Audited information

Single total figure table (audited)

The remuneration for the Chair, Executive and Non-executive Directors of the Company who performed qualifying services during the

relevant financial year is detailed below. The Chair and Non-executive Directors received no remuneration other than their annual fee.

For the year ended 31 December 2024:

Name

Salary/fees

£000

Taxable

benefits

£000

Pension

£000

Total fixed

remuneration

£000

Bonus

£000

Long-term

incentives

£000

Total variable

remuneration

£000

Total

remuneration

£000

Darren Waters 422 18 21 461 15 – 15 476

Michael Scott 305 18 15 338 15 – 15 353

Derek Mapp 155 – – 155 – – – 155

Frank Nelson

25 – – 25 – – – 25

Kate Allum

36 – – 36 – – – 36

Alison Littley

73 – – 73 – – – 73

Iraj Amiri 62 – – 62 – – – 62

Will Truman 52 – – 52 – – – 52

Angela Rushforth

47 – – 47 – – – 47

For the year ended 31 December 2023:

Name

Salary/fees

£000

Taxable

benefits

£000

Pension

£000

Total fixed

remuneration

£000

Bonus

£000

Long-term

incentives

£000

Total variable

remuneration

£000

Total

remuneration

£000

Darren Waters

296 12 15 323 89 – 89 412

Michael Scott 291 17 15 323 89 – 89 412

Mark Kelly

174 9 16 199 47 – 47 246

Derek Mapp 150 – – 150 – – – 150

Frank Nelson 62 – – 62 – – – 62

Kate Allum

56 – – 56 – – – 56

Alison Littley 59 – – 59 – – – 59

Iraj Amiri

56 – – 56 – – – 56

Will Truman

32 – – 32 – – – 32

Martyn Coffey

21 – – 21 – – – 21

Notes:

1 Taxable benefits comprise company car (and fuel) or car allowance, private family medical cover, permanent health insurance and travel insurance.

2 Bonuses are calculated on the annualised salary as at the end of the financial year.

3 No long-term incentives vested during the year.

4 Frank Nelson stepped down as Chair of the Audit and Risk Committee on 11 May 2023 and from the Board on 16 May 2024.

5 Kate Allum was appointed Chair of the Remuneration Committee from 11 May 2023. She stepped down from the Board on 31 July 2024.

6 Alison Littley was appointed as Senior Independent Director from 16 May 2024 and Remuneration Committee Chair from 1 July 2024.

7 Angela Rushforth was appointed to the Board 1 February 2024.

8 Darren Waters was appointed to the Board on 11 April 2023 and Chief Executive from 11 May 2023.

9 Mark Kelly stepped down from the Board on 11 May 2023.

10 Iraj Amiri was appointed Chair of the Audit and Risk Committee from 11 May 2023.

11 Will Truman was appointed to the Board on 11 May 2023.

12 Martyn Coffey stepped down from the Board on 11 May 2023.

The aggregate emoluments (being salary/fees, bonuses, benefits and pension allowances) of all Directors for 2024 was £1,279,000

(2023: £1,506,000).

DIRECTORS’ REMUNERATION REPORT CONTINUED

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 103

Further information on the 2024 annual bonus (audited)

In 2024, the annual bonus metrics were a blend of targets relating to profit before tax (70% of the bonus opportunity) and cash flow

(30% of the bonus opportunity). In addition, a health and safety adjustment underpin is applied which, if not achieved, could reduce

the bonus pay-out.

The profit before tax and cash flow bonus targets and achievements were as follows:

£m Threshold Target Maximum Actual

Achievement

(%of max)

Adjusted profit before tax 19.0 20.0 21.5 18.6

Adjusted cash generated from operations 45.7 4 8.1 51.7 4 9.1

82%

1 Adjusted profit before tax for the year ended 31 December 2024 of £20.0 million, less a pro forma adjustment of £1.4 million, being an estimated on-target bonus

charge for the profit element of the Annual Bonus Plan that would be payable for that level of outturn.

2 Cash generated from operations of £47.2 million plus cash paid in respect of non-underlying items of £1.9 million (see Note 7 to the Consolidated Financial Statements).

In order to reflect the level of stretch within the targets, the Committee determined that a pay-out of 75% of base salary would be

appropriate for an on-target performance for 2024.

Whilst reported adjusted profit before tax of £20.0 million is in line with the target, including a pro forma on-target charge for the profit

element of the Annual Bonus Plan for all scheme participants would reduce this result by c.£1.4 million, taking it below threshold level.

The Committee, therefore, determined that no bonus is payable in connection with the profit element of the plan.

Performance against the cash flow element of the Annual Bonus Plan resulted in an achievement of 102% of the cash flow target set

for that element.

The health and safety underpin was also considered satisfied.

After the appropriate weightings are applied, the performance outturns achieved would ordinarily provide for an overall pay-out of 25%

of salary being awarded to the Executive Directors representing a cash value of £107k to Darren Waters and £77k to Michael Scott.

However, the Committee elected to exercise its discretion to scale back the payment to reflect its assessment of the broader

performance context. The Committee approved a fixed payment of £15k to each of the Executive Directors, consistent with the

approach taken for determining other payments under the scheme this year.

Eurocell plc Annual Report and Accounts 2024104

DIRECTORS’ REMUNERATION REPORT CONTINUED

PSP awards vesting in respect of 2024 (audited)

The PSP values included for 2024 under the long-term incentives column in the single figure table relate to awards granted in 2022,

which vest in 2025, dependent on EPS and ROCE performance measured over the three-year period ended 31 December 2024,

as described in the tables below.

Under the EPS element (two-thirds of the award), 25% vests where adjusted basic EPS of 21.2 pence is achieved for the year ended

31 December 2024, increasing pro rata to full vesting where adjusted basic EPS of 22.8 pence is achieved.

Performance target

Threshold Maximum Actual

Vesting % of

element

Adjusted basic EPS 21.2p 22.8p 14.4p 0%

Under the Group ROCE element (one-third of the award), 25% vests where Group ROCE of 21.0% is achieved for the year ended

31 December 2024, increasing pro rata to full vesting where Group ROCE of 26.0% is achieved.

Performance target

Threshold Maximum Actual

Vesting % of

element

Group ROCE

21.0% 26.0% 16.9% 0%

1 Adjusted operating profit for the year ended 31 December 2024, divided by average totals of opening and closing assets less trade and other payables, all measured

on a pre-IFRS 16 basis.

As a result of performance against the targets set, PSP awards made in 2022 will lapse in full in 2025. No discretion to the formulaic

outcome has been applied by the Committee.

PSP awards granted in 2024 (audited)

The following awards were made under the PSP in 2024:

Director Date of grant

Basis of award

(% salary) Share price

Number of

Face value

of award

Performance period

Darren Waters 10 April 2024 150% 132.2p 483,812 £639,599 January 2024 to December 2027

Michael Scott 10 April 2024 150% 132.2p 349,563 £4 6 2,112 January 2024 to December 2027

1 Rounded to one decimal place for the purposes of presentation in this report.

2 Calculated using the average share price over the three business days immediately prior to the date of grant.

The performance conditions applying to these awards comprise adjusted basic EPS for two-thirds of the award and Group ROCE for

one-third of the award, as follows:

Adjusted basic EPS

for the year ended 31 December 2026 Portion of award vesting

Above 20.9p 100%

Between 19.3p and 20.9p Pro rata on straight-line between 25% and 100%

19.3p 25%

Below 19.3p 0%

Group ROCE

for the year ended 31 December 2026 Portion of award vesting

Above 25% 100%

Between 20% and 25% Pro rata on straight-line between 25% and 100%

20% 25%

Below 20% 0%

1 Defined as adjusted basic earnings per share as shown in the consolidated audited accounts of the Company, excluding non-underlying items.

2 Defined as Group adjusted operating profit divided by average totals of opening and closing assets less trade and other payables (all on a pre-IFRS 16 basis).

DSP awards granted in 2024 (audited)

No awards were made under the DSP in 2024 in respect to the 2023 annual bonus, as the bonus outcome (30% of salary) was

below the 75% of salary threshold above which deferral applies.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 105

Outstanding share plan awards (audited)

Details of all outstanding share awards made to Executive Directors are set out below:

Executive

Award

type

Exercise

price

(p) Grant date

Number of shares

Exercise period Notes

Interest at

1 January

2024

Awards

granted

in the year

Awards

lapsed

in the year

Awards

exercised

in the year

Interest at

31 December

2024

Darren Waters PSP 0 11/04/23 461,365 – – – 461,365 Apr 26 – Apr 27 3

DSP 0 11/04/23 410,447 – – – 410,447 Apr 25 – Apr 26 3

PSP 0 10/04/24 – 483,812 – – 483,812 Apr 27 – Apr 28 4

SAYE 92.4

7, 8

19/04/24 – 20,075 – – 20,075 June 27 – Nov 27 7, 8

Michael Scott PSP 0 22/04/21 149,731 – (149,731) – – Apr 24 – Apr 25 1

PSP 0 13/04/22 184,322 – – – 184,322 Apr 25 – Apr 26 2

PSP 0 11/04/23 333,345 – – – 333,345 Apr 26 – Apr 27 3

PSP 0 10/04/24 – 349,563 – – 349,563 Apr 27 – Apr 28 4

DSP 0 13/04/22 28,589 – – – 28,589 Apr 25 – Apr 26 5

SAYE 110.8 17/04/23 16,245 – – – 16,245 Jun 26 – Nov 26 6

Mark Kelly DSP 0 13/4/22 44,789 0 0 0 44,789 Apr 25 – Apr 26 5

All figures above exclude dividend equivalent shares, where applicable.

Notes:

1 See ‘PSP Awards Vesting in Respect of 2023’ in the 2023 Directors’ Remuneration Report.

2 See ‘PSP Awards Vesting in Respect of 2024’ section.

3 As disclosed in the 2023 Directors’ Remuneration Report.

4 See ‘PSP Awards Granted in 2024’ section.

5 See ‘DSP Awards Granted in 2023’ in the 2023 Directors’ Remuneration Report.

6 Awards granted under the Eurocell plc Save As You Earn Scheme in 2023. Awards are based on a three-year savings contract with an exercise price of 110.8 pence.

7 Awards granted under the Eurocell plc Save As You Earn Scheme in 2024. Awards are based on a three-year savings contract with an exercise price of 92.4 pence.

8 Representing a 20% discount to the market value of the shares at the date of grant.

During the year ended 31 December 2024, the highest mid-market price of the Company’s shares was 189.0 pence and the lowest

mid-market price was 111.50 pence. At 31 December 2024 the share price was 171.0 pence.

The aggregate gains by all Directors during 2024 was £Nil (2023: £434,654).

Eurocell plc Annual Report and Accounts 2024106

DIRECTORS’ REMUNERATION REPORT CONTINUED

Statement of Directors’ shareholdings and share interests (audited)

The table below details for each Director who served during 2024, the total number of Directors’ interests in shares at 31 December 2024

and 31 December 2023:

Number of shares/options

Beneficially

owned

31 December

2023

Beneficially

owned

31 December

2024

Vested but

unexercised

awards

Unvested

DSP share

options

Unvested

PSP share

options

Unvested

SAYE options

Shareholding

guideline

(% of salary)

Shareholding

guideline

met?

Darren Waters 42,161 42,161 – 410,447 945,177 20,075 200 No

Michael Scott 179,157 179,157 – 28,589 867,230 16,245 200 No

Derek Mapp 571,910 586,417 – – – – – n/a

Frank Nelson 90,973 94,594 – – – – – n/a

Kate Allum 4,417 9,533 – – – – – n/a

Alison Littley 4,282 9,991 – – – – – n/a

Iraj Amiri 4,928 65,599 – – – – – n/a

Will Truman 862 5,767 – – – – – n/a

Angela Rushforth

– 3,305 – – – – – n/a

1 The beneficial shareholdings set out above include those held by Directors and their respective connected persons as at 31 December 2024 or at the date of stepping

down from the Board if earlier (Frank Nelson and Kate Allum stepped down from the Board on 16 May 2024 and 31 July 2024 respectively).

2 Performance-based share awards.

3 The shareholding guideline for Executive Directors is 200% of salary. Executive Directors are required to retain at least 50% of the net of tax shares, which vest under

the PSP and DSP until the guideline is met.

4 Angela Rushforth joined the Board on 1 February 2024.

As previously announced, a number of the Non-executive Directors, including the Chair of the Board, entered into a share purchase

plan for 12 months from 1February 2023, which was subsequently extended for a further 12 months from February 2024 and will be

renewed again in March 2025 for a further 12 months. Each participating Director has irrevocably instructed the Company to direct

one-quarter of their net monthly fees to an appointed broker to automatically make market purchases of ordinary shares.

As a result, the number of shares beneficially owned since 31 December 2024 has changed due to planned purchases that took place

on 10 February 2025 for Non-executive Directors. The revised figures are as follows: Derek Mapp – 590,067 shares, Alison Littley –

11,795 shares, Iraj Amiri – 67,055 shares, WillTruman–7,448 shares, Angela Rushforth 4,330 shares.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 107

Payments to past Directors (audited)

No payments to past Directors were made during the year. The pro-rated interest in the 2021 PSP retained by Mark Kelly following his

retirement on 11 May 2023 lapsed in full in 2024, following the Committee’s confirmation that the performance conditions had not been met.

Payments for loss of office (audited)

No payments for loss of office were made during the year.

Performance graph and CEO remuneration table (unaudited)

The following graph shows the Total Shareholder Return (‘TSR’) performance of an investment of £100 in Eurocell plc’s shares from its

listing in March 2015 to 31 December 2024, compared with a £100 investment in the FTSE SmallCap Index over the same period.

The FTSE SmallCap Index was chosen as a comparator because it represents a broad equity market index of similar-sized companies.

Total Shareholder Return Index (unaudited)

Eurocell plc FTSE SmallCap Index

250

200

150

100

31 Dec

2015

3 Mar

2015

31 Dec

2016

31 Dec

2017

31 Dec

2018

31 Dec

2019

31 Dec

2020

31 Dec

2021

31 Dec

2022

31 Dec

2024

31 Dec

2023

The table below details certain elements of the CEO’s remuneration over the same period as presented in the TSR Index graph:

Year CEO

Single figure of

total remuneration

Annual bonus

pay-out

against

maximum %

Long-term incentive

vesting rates against

maximum

2024 Darren Waters £475,613 4% n/a

2023 Darren Waters £411,794 30% n/a

Mark Kelly £245,612 30% 0%

2022 Mark Kelly £8 5 7, 0 9 0 23% 63%

2021 Mark Kelly £879,271 100% 0%

2020 Mark Kelly £465,945 0% 0%

2019 Mark Kelly £673,262 49% 0%

2018 Mark Kelly £459,294 0% 0%

2017 Mark Kelly £916,442 40% n/a

2016 Mark Kelly £560,558 80% n/a

Patrick Bateman £284,457 33% n/a

2015 Patrick Bateman £637,098 87% n/a

As the Company listed in March 2015, part of the 2015 remuneration relates to when Eurocell was a privately owned Company.

Eurocell plc Annual Report and Accounts 2024108

DIRECTORS’ REMUNERATION REPORT CONTINUED

Annual change in remuneration of each Director compared to employees (unaudited)

The table below presents the year-on-year percentage change in remuneration for each Director who served in 2024 and for all

Group employees:

% change from 2023 to 2024 % change from 2022 to 2023 % change from 2021 to 2022

Salary/fee

increase/

decrease

Annual

bonus

increase/

decrease

Taxable

benefits

increase/

decrease

Salary/fee

increase/

decrease

Annual

bonus

increase/

decrease

Taxable

benefits

increase/

decrease

Salary/fee

increase/

decrease

Annual

bonus

increase/

decrease

Taxable

benefits

increase/

decrease

Darren Waters

42% (83)% 42% n/a n/a n/a n/a n/a n/a

Michael Scott 5% (83)% 6% 7% 41% 0% 6% (76)% 25%

Derek Mapp

4% n/a n/a 60% n/a n/a n/a n/a n/a

Frank Nelson

(60)% n/a n/a 3% n/a n/a 25% n/a n/a

Kate Allum

1, 5

(36)% n/a n/a 133% n/a n/a n/a n/a n/a

Alison Littley

1, 4

24% n/a n/a 146% n/a n/a n/a n/a n/a

Iraj Amiri

11% n/a n/a 700% n/a n/a n/a n/a n/a

Will Truman

63% n/a n/a n/a n/a n/a n/a n/a n/a

Angela Rushforth

n/a n/a n/a n/a n/a n/a n/a n/a n/a

All employees

4% (61)% 2% 5% 36% 2% 4% (76)% 2%

1 Directors appointed to the Board during 2022.

2 Directors appointed to the Board during 2023.

3 Angela Rushforth joined the Board during 2024.

4 Increase includes additional fees for assuming Remuneration Chair and Senior Independent Director roles during 2024.

5 Kate Allum and Frank Nelson stepped down from the Board during 2024.

6 Percentage increase is not available due to 2020 bonuses being £nil.

7 All Directors took a 20% reduction in salary/fees, for two months, during the first lockdown period in 2020.

8 Group employee percentages provided for context only as a voluntary disclosure in excess of those made regarding the Parent Company.

CEO to employee pay ratio (unaudited)

The table below shows the CEO to employee pay ratio.

Year Method 25th percentile pay ratio Median pay ratio 75th percentile pay ratio

2024 Option B 20:1 18:1 15:1

2023 Option B 25:1 22:1 18:1

2022 Option B 37:1 31:1 24:1

2021 Option B 42:1 33:1 27:1

2020 Option B 23:1 19:1 15:1

2019 Option B 34:1 27:1 21:1

Notes to the CEO to employee pay ratio:

1 Option B (based on the gender pay gap reporting disclosures) was preferred as this data was already prepared on a Group basis.

2 In line with the gender pay gap reporting regulations, pay for the 25th percentile, median and 75th percentile employees was calculated with reference to 5 April for

each financial year.

3 The ratios shown are representative of the FTE 25th percentile, median and 75th percentile pay for employees within the Group at the gender pay gap reference date

of 5 April 2024.

4 FTE equivalent pay has been calculated using the gender pay gap reporting methodology.

5 For 2023, the total of salary, benefits, pension, bonus and long-term incentives, being the single figure of total remuneration, for both Chief Executives who served

during the year combined, was used.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 109

% change from 2020 to 2021

% change from 2019 to 2020

Salary/fee

increase/

decrease

Annual

bonus

increase/

decrease

Taxable

benefits

increase/

decrease

Salary/fee

increase/

decrease

Annual

bonus

increase/

decrease

Taxable

benefits

increase/

decrease

n/a n/a n/a n/a n/a n/a

5% n/a

2% 2% (100)% (12)%

n/a n/a n/a n/a n/a n/a

n/a n/a n/a (3)% n/a n/a

3% n/a n/a n/a n/a n/a

n/a n/a n/a n/a n/a n/a

6% 232% 0% 1% (50)% 0%

Eurocell plc Annual Report and Accounts 2024110

DIRECTORS’ REMUNERATION REPORT CONTINUED

This is our first reporting year for our new CEO Darren Waters and comparison between this year and that of the most recent reporting

cycle in 2023 are restricted as combined data for both Chief Executive Officer’s was used in the last report. We recognise that we see a

narrowing CEO pay ratio across each quartile, but note this is partly driven by Darren’s early tenure meaning performance share awards

have not yet had time to reach vesting.

The total pay and benefits and the salary component of total pay and benefits for the employee at each of the 25th percentile,

the median and the 75th percentile are shown below:

Salary

£000

Total pay and benefits

£000

25th percentile Median 75th percentile 25th percentile Median 75th percentile

2024 27 31 37 28 32 38

Based on the salary profile of the Group’s UK employees, the median pay ratio is consistent with the pay, reward and progression

policies of the Group as a whole.

Relative importance of spend on pay (unaudited)

The table below details the change in total employee pay between 2023 and 2024 as detailed in Note 8 of the Financial Statements,

compared with distributions to shareholders by way of dividend, share buybacks or any other significant distributions or as detailed

in Note 26 of the Financial Statements.

% change

2024

£m

2023

£m

Total gross employee pay 5% 89.2 85.2

Dividends/share buybacks 98% 20.4 10.3

The average number of employees during the year was 2,067 (2023: 2,101).

Statement of voting at the Annual General Meeting (unaudited)

The following table shows the results of the binding Remuneration Policy vote at the 2022 AGM and the advisory Directors’

Remuneration Report (excluding the policy part) vote at the 2024 AGM.

Approval of the Directors’ Remuneration Policy Annual Report on Remuneration

Total number of votes % of votes cast Total number of votes % of votes cast

For (including discretionary) 97,411,403 100% 89,764,798 100%

Against – 0% 999 0%

Votes withheld – – – –

Implementation of policy for 2025 (unaudited)

Base salaries

Current base salaries are as follows: £426,400 per annum for Darren Waters and £308,082 per annum for Michael Scott. With effect

from 1 April 2025, these salaries will be increased by 2% to £434,928 and £314,244 respectively. The salary increase is in line with that

of the wider workforce and the resulting salaries remain below the median for FTSE companies of comparable size and complexity.

Pensions

A defined contribution/salary supplement of 5% of salary, which is aligned to the wider workforce, is offered to Darren Waters

and Michael Scott.

Benefits

Details of the benefits received by Executive Directors are set out in Note 1 to the Single Total Figure Table on page 102. There is no

intention to introduce additional benefits in 2025.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 111

Annual bonus

As explained earlier in this report, subject to shareholder approval of the proposed policy at the 2025 AGM, the maximum annual

bonus opportunity for the Chief Executive Officer will be increased to 150% of salary for 2025. The annual bonus opportunity for the

Chief Financial Officer remains unchanged at 100% of salary. The annual bonus will be payable based on performance against the

following blend of financial and non-financial measures: adjusted EPS (50%), adjusted operating cash flow (20%), ROCE (20%) and

strategic objectives (10%).

Performance targets for each element of the bonus scorecard have been set in light of internal and external forecasts and will require

outperformance of budget (and expectations in relation to strategic objectives) to generate higher levels of pay-out. In addition,

a health and safety adjustment underpin will continue to apply which, if not achieved, could reduce the bonus pay-out.

Given the competitive nature of the Company’s sector, the specific performance targets for 2025 are considered to be commercially

sensitive and, accordingly, are not disclosed at this time, although the targets will be disclosed in next year’s report in relation to the

2025 bonus outturn.

Subject to shareholder approval of the proposed policy, 50% of any bonus earned will be deferred into shares for three years, unless the

Executive Director meets their shareholding guideline at the time any bonus is to be paid, in which case the bonus will be paid in cash.

Long-term incentives

As disclosed on page 91, and again subject to shareholder approval of the proposed policy, PSP awards are expected to be made in

June 2025 to Michael Scott and Darren Waters at 600% and 800% of salary respectively. No further annual PSP awards are expected

to be made to Darren Waters and Michael Scott until 2029.

The following scorecard will apply to the 2025 PSP awards, with measures and targets aligned directly to the Group’s stated strategic

ambition, and performance measured over the four-year period to 31 December 2028:

Measure Weighting

Threshold

(25% vesting)

Stretch

(100% vesting)

Revenue 25% £450m £500m

Adjusted operating profit margin 25% 8.9% 10.0%

Adjusted operating profit 50% £40.0m £50.0m

Vesting for performance between threshold and stretch will be calculated pro rata on a straight-line sliding scale. Performance outcomes

below threshold will result in 0% vesting for that element.

Chair and Non-executive Directors’ fees

In line with the wider workforce, the fee for the Chair will be increased by 2% from £156,000 per annum to £159,120 per annum

and the base fees for Non-executive Directors will be increased by 2% from £52,000 per annum to £53,040 per annum with effect from

1 April 2025.

Similarly, additional fees for the Committee Chairs, where applicable, and the Senior Independent Director will be increased by 2%

from £10,400 per annum to £10,608 per annum with effect from 1 April 2025.

On behalf of the Board

Alison Littley

Chair of the Remuneration Committee

19 March 2025

Eurocell plc Annual Report and Accounts 2024112

The Directors present their audited consolidated financial statements for the year ended 31 December 2024. Eurocell plc (the ‘Company’)

is a company incorporated and domiciled in the UK, with registration number 08654028, and is the holding company of the Eurocell

Group of companies (the ‘Group’). All of the Group’s activities are within the United Kingdom, with the exception of two overseas

branches in the Republic of Ireland.

The shares of the Company have been traded on the main market of the London Stock Exchange throughout the year ended

31 December 2024.

The Directors’ Report includes the Corporate Governance Statement set out on pages 68 to 76.

The Directors’ Report and Strategic Report comprise the ‘Management Report’ for the purpose of the Financial Conduct Authority’s

Disclosure Guidance and Transparency Rules (DTR 4.1.8R).

The Directors of the Company, and their biographical details, are listed on pages 64 to 65 and were all in place on the date this

Directors’ Report was approved. Changes to the Directors during the year, and up to the date of this report, are set out below:

Director Position Service in the year and up to date of report approval

Current Directors:

Derek Mapp Chair Served throughout

Darren Waters Chief Executive Served throughout

Michael Scott Chief Financial Officer Served throughout

Alison Littley Independent Non-executive Director Served throughout

Iraj Amiri Independent Non-executive Director Served throughout

Will Truman Independent Non-executive Director Served throughout

Angela Rushforth Independent Non-executive Director Appointed 1 February 2024

Former Directors:

Frank Nelson Senior Independent Non-executive Director Served up to 16 May 2024

Kate Allum Independent Non-executive Director Served up to 31 July 2024

Strategic Report

As permitted by section 414C of the Companies Act 2006, certain information required to be included in the Directors’ Report has

been included in the Strategic Report, which is set out on pages 01 to 63. Specifically, this relates to information on the Group’s

strategy, business model, likely future developments and risk management.

UK Corporate Governance Code

(the ‘Code’)

For the year ended 31 December 2024,

the Board is reporting under the 2018

Code. Further information is set out in

the Strategic Report on pages 01 to 63

which examines the ‘purpose’ aspect

of the 2018 Code and in the Corporate

Governance Statement on pages 68 to 76,

which describes the Company’s approach

and practices in relation to the 2018 Code.

The page numbers cited are incorporated

herein by reference.

Results

Our Financial Statements for the year

ended 31 December 2024 are set out

on pages 126 to 172. The Financial

Statements should be read in conjunction

with the Chief Executive’s Report,

DivisionalReviews and the Chief Financial

Officer’s Report.

Dividends

The Board is recommending a final

dividend of 3.9 pence (2023: 3.5 pence)

per share for 2024 which, together with

the interim dividend of 2.2 pence (2023:

2.0 pence) per share, makes a combined

dividend of 6.1 pence (2023: 5.5 pence)

per share.

Payment of the final dividend, if approved

at the Annual General Meeting (‘AGM’), will

be made on 23 May 2025 to shareholders

registered at the close of business on

25 April 2025. The ex-dividend date will be

24 April 2025.

Dividends paid in the year to 31 December

2024 and disclosed in the Consolidated

Cash Flow Statement of £6.1 million

(2023: £10.3 million), is comprised of

the 2023 final dividend of 3.5 pence per

share, which was paid in May 2024, and

the 2024 interim dividend of 2.2 pence per

share, which was paid in October 2024.

Tax governance

Our tax policy is set out below. It is

determined by the Board and overseen

by the Audit and Risk Committee.

The Board reviews the policy, and our

compliance with it, on an annual basis.

It was last reviewed in December 2024.

Operational responsibility for the execution

of the Group’s tax policy rests with the

Chief Financial Officer, who reports the

Group’s tax position to the Audit and Risk

Committee on a regular basis.

Tax policy

We are committed to compliance with tax

law and practice in the UK and Ireland.

Compliance for us means paying the

amount of tax we are legally obliged to

pay and doing so in the right place, at the

right time. It involves disclosing all relevant

facts and circumstances to the UK and

Irish tax authorities in ways that reflect the

economic reality of the transactions we

undertake and claiming appropriate reliefs

and incentives where available.

DIRECTORS’ REPORT

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 113

Risk management of tax affairs

The level of risk that we accept in relation

to UK tax is consistent with our overall

objective of achieving certainty in the

Group’s tax affairs. At all times, we seek

to comply fully with our regulatory and

other obligations, and to act in a way that

upholds our core values and reputation as

a responsible corporate citizen. We see

compliance with tax legislation as key to

managing tax risk, and understand the

importance of tax in the wider context of

business decisions.

Processes have been put in place to

ensure tax is considered as part of our

overall decision-making processes, with tax

risks managed by local finance teams and

escalated through to appropriate levels of

management and, ultimately, to the Board

when necessary.

Tax planning

In structuring our commercial activities,

we will always consider – among other

factors – the relevant tax laws. We believe

that it is fair to mitigate tax using generally

available reliefs in the spirit in which they

are intended. However, any tax planning

that we undertake will have commercial

and economic substance and we will not

use aggressive tax planning or enter into

complicated tax avoidance schemes.

Although for commercial reasons, we

may trade with customers and suppliers

genuinely located in countries considered

to be tax havens, we will not use such

jurisdictions for the purpose of avoiding

tax, nor will we seek to take advantage

of the secrecy afforded to transactions

recorded in these jurisdictions.

Engaging with HMRC

We aim to have a good working

relationship with HMRC. We will engage

with honesty and integrity, and in a spirit

of cooperative compliance. We will make

all returns and pay tax on a timely basis,

across all types of tax.

Share capital

Details of our capital structure, including

movements in issued share capital during

the year, are shown in Note 25 to the

Financial Statements. We have one class

of ordinary shares, which carries no fixed

income. Each share carries the right to one

vote at our general meetings. The ordinary

shares are listed on the Official List and

traded on the London Stock Exchange.

As at 31 December 2024, there were

103,150,173 (2023: 112,095,184) ordinary

shares of 0.1 pence each in nominal value

in issue (the ‘issued share capital’) of which

1,342,000 shares are held in treasury and

the Company’s employee share trusts

held 13,786 shares. Details of the shares

issued in the year are shown in Note 25

to the Consolidated Financial Statements.

No securities were issued in connection

with a rights issue during the period.

As at 31 December 2024, the Company

had purchased 10,287,011 ordinary shares

under the share buyback programme

launched on 23 January 2024 and as

extended on 16 May 2024 and

4 September 2024. The nominal value of

each of the shares purchased was £0.001

for a total consideration of £14.3 million.

1,342,000 shares repurchased had been

transferred into treasury to satisfy employee

share awards, whilst all other shares that

were repurchased have/will be cancelled.

The purpose of the programme was to

reduce the share capital of the Company.

Subsequent to year-end, and up to

14February 2025, a further 405,868

ordinary shares have been purchased

for cancellation for consideration of

£0.6 million. These post year end

transactions were also completed with

the purpose of reducing the share capital

of the Company.

Holders of ordinary shares are entitled

to receive dividends when declared, to

receive the Company’s Annual Report,

to attend and speak at general meetings

of the Company, to appoint proxies and

to exercise voting rights.

While the Board has the power under the

Articles of Association to refuse to register

a transfer of shares, there are no such

restrictions on the transfer of shares in place.

Under the Company’s Articles of

Association, the Directors have the power

to suspend voting rights and the right to

receive dividends in respect of shares in

circumstances where the holder of those

shares fails to comply with a notice issued

under section 793 of the Companies Act

2006. The Company is not aware of any

agreements between shareholders that

may result in restrictions on the transfer

of securities or voting rights.

Share schemes

The Company operates a number

of shareschemes.

Long-Term Incentive Plans payable to

executives and senior managers are

operated under our Performance Share

Plan (‘PSP’). Executive Directors may

havea proportion of their annual bonus

deferred for up to three years under

our Deferred Share Plan (‘DSP’).

The Company also operates Save As

You Earn (or ‘Sharesave’) schemes,

which areavailable to all employees.

All shares issued under these plans carry

the same rights as those already in issue.

During the period, shares with a nominal

value of £Nil were allotted under

all-employee schemes as permitted under

Section 549 of the Companies Act 2006.

Related party transactions

Other than in respect of arrangements set

out in Note 30 to the Financial Statements

and in relation to the employment of

Directors, details of which are provided

in the Remuneration Committee Report

on pages 90 to 111, there is no material

indebtedness owed to, or by, us to any

colleague or any other person or entity

considered to be a related party. Internal

controls are in place to ensure that

any related party transactions involving

Directors or their connected persons are

carried out on an arm’s-length basis and

are properly recorded.

Eurocell plc Annual Report and Accounts 2024114

The Takeover Directive

The rights and obligations attached to

the issued share capital are set out in the

Articles of Association (see below).

There are no agreements in place between

the Company, its employees or Directors

for compensation for loss of office or

employment that trigger as a result of a

takeover bid.

Articles of Association

The Company’s Articles of Association

canonly be amended by special

resolution of the shareholders. Our current

articles are available on our website at:

investors.eurocell.co.uk.

The Company’s Articles of Association

givepowers to the Board to appoint

Directors. All Board members are

required to retire and submit themselves

for re-election by shareholders at each

AnnualGeneral Meeting.

The Board of Directors may exercise all

the powers of the Company, subject to

the provisions of relevant legislation, the

Company’s Articles of Association and

any directions given by the Company

in general meetings. The powers of the

Directors include those in relation to the

issue and buyback of shares.

Directors’ retirement by rotation

In accordance with above and in line with

the Code, all Directors in office will retire

and offer themselves for election/

re-election at the 2025 AGM.

The Articles of Association provide that a

Director may be appointed by an ordinary

resolution of shareholders or by existing

Directors, either to fill a vacancy or as an

additional Director.

The Executive Directors serve under

contracts that are terminable with

12 months’ notice from the Company

and 12 months’ notice from the

ExecutiveDirector. The Non-executive

Directors serve under letters of

appointment and do not have service

contracts with the Company.

Copies of the service contracts of the

Executive Directors and the letters

of appointment of the Non-executive

Directors are available for inspection at the

Company’s registered office during normal

business hours and will be available for

inspection at the Company’s AGM.

There are no specific Company rules in

relation to the appointment/replacement

of Directors and all such matters are

managed by the Board in accordance with

the Articles of Association, the Companies

Act 2006 and any directions given by

special resolution.

Directors’ interests

Details of Directors’ remuneration, interests

in the share capital (or derivatives or other

financial instruments relating to those

shares) of the Company and of their

share-based payment awards are

contained in the Remuneration Committee

Report on page 106.

Directors’ indemnities

Pursuant to the Articles of Association,

the Company has executed a deed

poll of indemnity for the benefit of the

Directors of the Company, and persons

who were Directors of the Company,

in respect of costs of defending claims

against them and third-party liabilities.

These provisions, deemed to be qualifying

third-party indemnity provisions pursuant

to section 234 of the Companies Act

2006, were in force during the year ended

31 December 2024 and remain in force.

The indemnity provision in the Company’s

Articles of Association also extends to

provide a limited indemnity in respect of

liabilities incurred as a director, secretary

or officer of an associated company of

the Company.

A copy of the deed poll of indemnity is

available for inspection at the Company’s

registered office during normal business

hours and will be available for inspection

at the Company’s AGM.

DIRECTORS’ REPORT CONTINUED

Substantial shareholders

The Company’s major shareholders, with a shareholding above 3%, as at 31 December 2024 and subsequent changes up

to17March 2025

, were as follows:

Shareholder

At 31 December 2024 Changes since 31 December 2024

No. of Shares % of voting rights No. of Shares % of voting rights

Aberforth Partners 24,795,409 24.4% 24,895,409 24.6%

JO Hambro Capital Management 11,533,291 11.3% 11,721,259 11.6%

Huntington Management 7,750,775 7.6% – –

Chelverton Asset Management 6,412,295 6.3% 6,312,295 6.2%

Soros Fund Management 5,602,726 5.5% 5,494,351 5.4%

ACR Alpine Capital Research 5,300,660 5.2% 5,340,660 5.3%

Allianz Global Investors 3,641,634 3.6% 3,15 6,772 3.1%

Bank of New York 3,495,889 3.4% 4,179,479 4.1%

1 Being the latest practicable date prior to the date of this report.

2 Changes notified to the Company pursuant to Chapter 5 of the Disclosure Guidance and Transparency Rules between 31 December 2024 and 17 March 2025

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 115

Conflicts of interest

Under the Companies Act 2006, Directors

must avoid situations where they have, or

could have, a direct or indirect interest that

conflicts or possibly may conflict with the

Company’s interests. As permitted by the

Act, the Company’s Articles of Association

enable Directors to authorise actual or

potential conflicts of interest.

The Board has a formal system in place

for Directors to declare conflicts to be

considered for authorisation by those

Directors who have no interest in the

matter being considered. In deciding

whether to authorise a conflict, the

non-conflicted Directors are required

to act in the way they consider would

be most likely to promote the success

of the Company for the benefit of all

shareholders, and they may impose limits

or conditions when giving authorisation,

or subsequently, if they think this is

appropriate. The Board believes that

the systems it has in place for reporting

and considering conflicts continue to

operate effectively.

Legal and regulatory compliance

The executive team is responsible for

identifying and carrying out assessments of

those areas of the business where material

legal and regulatory risks may be present.

Where issues are identified, mitigating

actions are built into an action plan

involving the drafting and communication

of policies and the delivery of training where

appropriate, or are approached by way of

a revision to key contractual terms. The

Board receives regular reports on material

litigation and the legal action taken to

support our strategy.

Health and safety

We are committed to providing a safe

place for colleagues to work. Our policies

are reviewed on an ongoing basis to

ensure that the approach to training,

risk assessment, safe systems of working

and accident management is appropriate.

As part of this process, a rolling audit

programme is in place to ensure that

health, safety, environmental and security

risks are assessed stringently and that

robust control measures are in place to

limit or mitigate risk as appropriate.

Events after the balance sheet date

In March 2025 the Group completed the

acquisition of Alunet for consideration

of £29 million on a debt/cash-free basis,

comprising an initial payment of £22

million and deferred consideration of

approximately £7 million payable in four

annual instalments beginning in 2026.

Additional contingent consideration

of up to £6m may become payable,

subject to an earnout mechanism, in four

annual instalments beginning in 2026,

based upon the EBITDA of Alunet in the

preceding calendar year. The maximum

of £6 million, if achieved, would result in

a total consideration of £35 million.

Approximately £1 million of the initial

consideration is in the form of ordinary

shares in Eurocell plc and satisfied out of

shares held in treasury, with the remainder

payable in cash, funded from the Group’s

existing £75 million revolving credit facility.

Also, on 19 March 2025, the Group

approved a further share buyback

programme of up to £5 million,

tobeginimmediately.

Other matters

Employee disclosure (including

equality, diversity and disabled

employees)

See Sustainability Report on pages 22

to39.

Employee engagement statement

See Corporate Governance Statement

on pages 67 to 76.

Statement on engagement with

suppliers, customers and others

in a business relationship with

theCompany

See Corporate Governance Statement

onpages 67 to 76.

Financial risk management

See Note 3 of the Financial Statements.

Research and development

The Group undertakes research

anddevelopment work in support

ofitsobjectives.

Payments to suppliers

It is Group policy to abide by the payment

terms agreed with suppliers, provided that

the supplier has performed its obligations

under the contract.

Political donations

In accordance with the Group’s policy,

no political donations were made, and

no political expenditure was incurred

(2023: £nil). The Company will, however,

as a precautionary measure to avoid

inadvertent breach of the law, seek

shareholder authority at its 2025 AGM to

make limited donations or incur limited

political expenditure, although it has no

intention of using the authority.

Greenhouse gas emissions and

energy use

See Sustainability Report onpages 22

and39.

Disclosure of information to

auditors

See the Directors’ confirmations on

page116.

Disclosures required by Listing

Rule 9.8.4R

There were no waivers of dividends during

the year, which were greater than 1% of

the total value of the dividend paid. There

are no other disclosures to be made under

the above listing rule.

By order of the Board

Vicky Williams

Group Company Secretary

19 March 2025

Eurocell plc Annual Report and Accounts 2024116

The Directors are responsible for preparing

the Annual Report and Accounts 2024 and

the Financial Statements in accordance

with applicable law and regulation.

Company law requires the Directors to

prepare Financial Statements for each

financial year. Under that law, the Directors

have prepared the Group Financial

Statements in accordance with UK-adopted

international accounting standards and

the Company Financial Statements

in accordance with United Kingdom

Generally Accepted Accounting Practice

(United Kingdom Accounting Standards,

comprising FRS 101 ‘Reduced Disclosure

Framework’, and applicable law).

Under company law, 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 Company and of the profit or loss of

the Group for that period. In preparing the

Financial Statements, the Directors are

required to:

• Select suitable accounting policies and

then apply them consistently

• State whether applicable UK-adopted

international accounting standards have

been followed for the Group Financial

Statements and United Kingdom

Accounting Standards, comprising

FRS 101 have been followed for the

Company Financial Statements, subject

to any material departures disclosed and

explained in the Financial Statements

• Make judgements and accounting

estimates that are reasonable

andprudent

• Prepare the Financial Statements on

the going concern basis unless it is

inappropriate to presume that the Group

and Company will continue in business.

The Directors are responsible for

safeguarding the assets of the Group and

Company and hence for taking reasonable

steps for the prevention and detection of

fraud and other irregularities.

The Directors are also responsible for

keeping adequate accounting records

that are sufficient to show and explain the

Group’s and Company’s transactions and

disclose with reasonable accuracy at any

time the financial position of the Group and

Company and enable them to ensure that

the Financial Statements and the Directors’

Remuneration Report comply with the

Companies Act 2006.

The Directors are responsible for the

maintenance and integrity of the Company’s

website. Legislation in the United

Kingdom governing the preparation and

dissemination of financial statements may

differ from legislation in other jurisdictions.

Directors’ confirmations

The Directors consider that the Annual

Report and Accounts for 2024, taken

as a whole, are fair, balanced and

understandable and provide the information

necessary for shareholders to assess the

Group’s and Company’s position and

performance, business model and strategy.

Each of the Directors, whose names and

functions are listed in the Directors’ Report

confirm that, to the best of their knowledge:

• The Group Financial Statements, which

have been prepared in accordance with

UK-adopted international accounting

standards, give a true and fair view of

the assets, liabilities, financial position

and profit of the Group

• The Company Financial Statements,

which have been prepared in

accordance with United Kingdom

Accounting Standards, comprising FRS

101, give a true and fair view of the

assets, liabilities and financial position

of the Company

• The Strategic Report includes a fair review

of the development and performance

of the business and the position of the

Group and Company, together with a

description of the principal risks and

uncertainties that it faces.

In the case of each Director in office at the

date the Directors’ Report is approved:

• So far as the Director is aware, there is

no relevant audit information of which

the Group’s and Company’s auditors

are unaware

• They have taken all the steps that they

ought to have taken as a Director in

order to make themselves aware of any

relevant audit information and to establish

that the Group’s and Company’s auditors

are aware of that information.

The Directors’ Responsibility Statement was

approved by the Board on 19 March 2025.

Darren Waters

Chief Executive

Michael Scott

Chief Financial Officer

STATEMENT OF DIRECTORS’ RESPONSIBILITIES

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 117

Eurocell plc Annual Report and Accounts 2024118

INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF EUROCELL PLC

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS

OPINION

In our opinion:

• Eurocell plc’s group financial statements and company financial

statements (the “financial statements”) give a true and fair view

of the state of the group’s and of the company’s affairs as at

31 December 2024 and of the group’s profit and the group’s

cash flows for the year then ended;

• the group financial statements have been properly prepared

in accordance with UK-adopted international accounting

standards as applied in accordance with the provisions of

the Companies Act 2006;

• the company financial statements have been properly prepared

in accordance with United Kingdom Generally Accepted

Accounting Practice (United Kingdom Accounting Standards,

including FRS 101 “Reduced Disclosure Framework”, and

applicable law); and

• the financial statements have been prepared in accordance

with the requirements of the Companies Act 2006.

We have audited the financial statements, included within the

Annual Report and Accounts 2024 (the “Annual Report”), which

comprise: the Consolidated Statement of Financial Position and

the Company Statement of Financial Position as at 31 December

2024; the Consolidated Statement of Comprehensive Income,

the Consolidated Cash Flow Statement, the Consolidated

Statement of Changes in Equity and the Company Statement

of Changes in Equity for the year then ended; and the notes to

the financial statements, comprising material accounting policy

information and other explanatory information.

Our opinion is consistent with our reporting to the Audit and

Risk Committee.

BASIS FOR OPINION

We conducted our audit in accordance with International

Standards on Auditing (UK) (“ISAs (UK)”) and applicable law.

Our responsibilities under ISAs (UK) are further described in the

Auditors’ 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 remained independent of the group in accordance with the

ethical requirements that are relevant to our audit of the financial

statements in the UK, which includes the FRC’s Ethical Standard,

as applicable to listed public interest entities, and we have

fulfilled our other ethical responsibilities in accordance with

these requirements.

To the best of our knowledge and belief, we declare that

non-audit services prohibited by the FRC’s Ethical Standard

were not provided.

Other than those disclosed in note 5, we have provided no

non-audit services to the company or its controlled undertakings

in the period under audit.

OUR AUDIT APPROACH

Overview

Audit scope

• We defined a component as a company or division with its

own financial data. Our scoping process involved a top-down

risk assessment at the group financial statement level to

determine whether components were significant due to risk

or size. Components deemed significant underwent further

audit procedures. In this assessment, two components were

identified as significant due to risk or size, and one component

was identified as requiring a full scope audit. There were three

non-significant components, and one component was deemed

inconsequential. We determined whether any additional work

was necessary, the scope of this work, and assessed the risks

of material misstatement appropriately.

• For components that were non-significant, we considered

whether, in our judgement, any further audit procedures needed

to be performed. Additional audit procedures were conducted

on specific Financial Statement Line Items (FSLIs) if they

significantly contributed to the consolidated FSLI and exceeded

group performance materiality. For FSLIs where no further

testing was conducted, we assessed whether the risk of material

misstatement was reduced to an acceptably low level and

whether our coverage of group significant FSLIs was sufficient

and appropriate. Adequate coverage was maintained for the

reported consolidated revenues and the consolidated underlying

profit before taxation on an absolute basis. For all other non

significant balances and components, disaggregated analytical

review procedures were performed relative to group materiality.

• Work on the consolidation was considered separately to the

component scoping exercise and performed to group materiality.

• All work was performed by the group audit team

Key audit matters

• Trade receivables provisions (group)

• Inventory provisioning (group)

• Impairment of intercompany investments and intercompany

receivables (parent)

Materiality

• Overall group materiality: £1,000,000 (2023: £760,000) based

on 5% of underlying profit before taxation.

• Overall company materiality: £647,000 (2023: £481,000) based

on 1% of total assets.

• Performance materiality: £750,000 (2023: £570,000) (group)

and £485,250 (2023: £360,000) (company).

The scope of our audit

As part of designing our audit, we determined materiality

and assessed the risks of material misstatement in the

financial statements.

Key audit matters

Key audit matters are those matters that, in the auditors’ professional

judgement, were of most significance in the 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)

identified by the auditors, including 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, and any comments we make on the results of our

procedures thereon, were addressed in the context of our audit

of the financial statements as a whole, and in forming our opinion

thereon, and we do not provide a separate opinion on these matters.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 119

This is not a complete list of all risks identified by our audit.

Inventory labour and overhead absorption (group), which was a key audit matter last year, is no longer included because of the risk

being deemed to be lower with no significant estimation and judgement, as standard costs have been reviewed by management

and updated in the prior period. Otherwise, the key audit matters below are consistent with last year.

Key audit matter How our audit addressed the key audit matter

Trade receivables provisions (group)

Refer to Note 1 (Accounting Policies), Note 2 (Critical

Accounting Estimates and Judgements) and Note 19 (Trade

and other receivables). The Group had gross trade receivables

against which provisions were held in accordance with IFRS 9.

We focused on this area, and specifically the valuation

assertion, because the Directors’ assessment of the provisions

required in respect of trade receivables included subjective

estimates. These estimates, such as the appropriate level of

provisions to apply to aged debt, remain a risk in the current

year due to the uncertain market conditions ongoing into FY25.

We understood the Directors’ methodology for calculating trade

receivables provisions across the Group and considered if these

complied with IFRS 9. Audit procedures performed included:

• We evaluated the design and implementation of key controls

around the trade receivables provisioning process;

• We reviewed the accuracy of past management estimates via

look-back tests and movements in the provisions year on year;

• We confirmed that the amounts included in the IFRS 9 model

agreed back to the underlying ledgers as at 31 December 2024;

• We tested the accuracy of the calculations in the model;

• We tested the ageing of amounts due at the balance sheet date

to verify the data had been analysed correctly, and recalculated

actual debtors days for transactions cleared against debtor

balances in the year; and

• We considered the results of our other audit procedures over trade

receivables (for example review of post year end payments made

by customers) for inconsistencies with the IFRS 9 models.

We identified no material exceptions from the procedures noted

above. Based on the results of our audit work we concluded that

the provisions recorded were materially accurate, calculated in line

with the requirements of IFRS 9.

Inventory provisioning (group)

Refer to Note 1 (Accounting Policies) and Note 18 (Inventories).

We focused on this area because the Directors’ assessment of

the recoverability of inventory involved subjective judgements.

Specifically, the determination of inventory provisions for slow

moving, obsolete and discontinued line items, reflecting the level

of inventory held across the branch network and manufactured

goods at the year end, requires the exercise of estimation.

Our audit procedures over the impairment of inventory consisted of:

• We evaluated the design and implementation of key controls

around the inventory provisioning process;

• We understood the Directors’ methodology for calculating

inventory provisions;

• We reviewed the accuracy of past management estimates via

look-back tests and movements in the provisions year on year;

• Where inventory provisions were based upon historical sales

data, we tested the underlying report to validate the data on

which management’s calculations were based;

• We tested the overlay data used as input for determining the

inventory provision;

• We evaluated the Directors’ assumptions over usage and

validated historic usage which is then used to forecast future

sales rates;

• We attended physical inventory counts, conducted by

management, to highlight any increased areas of concern,

regarding excess / unused stock held at either the branches

we visited or the manufacturing sites;

• We performed sensitivity analysis on key variables within the

obsolete inventory provision to assess reliance of the model

on a particular variable; and

• Where specific impairments were made, outside of the standard

impairment reviews, we challenged management of the

completeness and appropriateness of these additional amounts.

Based on the results of our audit work, we concluded that provisions

recorded were materially accurate and calculated in line with the

requirements of IAS 2.

Eurocell plc Annual Report and Accounts 2024120

INDEPENDENT AUDITORS’ REPORT

CONTINUED

Key audit matter How our audit addressed the key audit matter

Impairment of intercompany investments and intercompany

receivables (parent)

Refer to Note 34 (Accounting Policies), Note 37 (Investments)

and Note 38 (Trade and other receivables). The company

has investments in subsidiary companies and intercompany

receivables. Material impairment to these could result in

implications for future dividends.

We obtained management’s impairment assessment regarding the

investment’s carrying value and management’s IFRS 9 expected

credit loss model in respect of the intercompany receivables.

The recoverability of the investment’s carrying value was based

upon the same underlying data noted in other group calculations

such as the going concern assessment and goodwill impairment

model. We also noted that the market capitalisation of the group

as at 31 December 2024 was significantly in excess of the parent

company’s total assets. We considered the IFRS 9 model and

noted that a significant change in the key assumption (being the

expected loss rate of 0.1%) would be required prior to a material

impairment being noted. The amounts owed to the company were

ultimately due from profitable subsidiaries, with sufficient net assets.

We tested the integrity of the models and the validity of the key data

inputs. No exceptions were noted in the performance of the above

procedures. We therefore concluded that the investments and

intercompany receivables were accounted for in line with IFRS 9

and IAS 36, with appropriate disclosures being made.

How we tailored the audit scope

We tailored the scope of our audit to ensure that we performed

enough work to be able to give an opinion on the financial

statements as a whole, taking into account the structure of the

group and the company, the accounting processes and controls,

and the industry in which they operate.

The business is managed as two primary divisions:

• Eurocell Building Plastics, focusing on sales and distribution

across over 200 branches within the UK and 2 in Ireland to

generally smaller scale customers; and

• Eurocell Profiles, focusing on manufacture and distribution

to large-scale customers. This division includes the trading

subsidiaries Eurocell Profiles Limited, Vista Panels Limited,

and Ecoplas Limited.

Other than Vista Panels Limited, which has its own finance team,

all finance and operational management functions are located at

the Alfreton headquarters. Therefore all audit work, including work

on components, was completed by a single group audit team.

For the purposes of our audit of the group we considered

components to be operations where there was discrete financial

data maintained by management, including a separate trial

balance. For the consolidated audit of Eurocell plc this related

to the individual subsidiary companies; Eurocell Building Plastics

Limited, with Eurocell Profiles Limited the statutory entity, being

seen as two components (excluding S&S Plastics a division within

Eurocell Profiles Limited but this component is inconsequential).

A component was included within our full scope audit

procedures, if it was considered to be significant due to size

or risk. There were two components (Eurocell Profiles Limited,

excluding the S&S plastics division and Eurocell Building Plastics

Limited) which we considered significant due to risk or size.

We then considered the entities which did not meet the

significance due to risk or size criteria and in our judgement

designated Eurocell plc company as a component where we

would perform a full scope audit.

We assessed the remaining five components to determine the

necessity of additional audit procedures. For components with

individual Financial Statement Line Items (FSLIs) that significantly

impacted the consolidated FSLI and exceeded the group

performance materiality, we included them in our audit scope.

We also evaluated FSLIs that were several times the materiality

threshold. Through professional judgement, we decided whether

these balances warranted inclusion in the full audit scope.

Consequently, FSLIs from three of the remaining components

were selected for large balance testing, while one entity was

deemed inconsequential. Adequate coverage was maintained

over the consolidated revenues and the consolidated underlying

profit before taxation, measured on an absolute basis. For all

other balances and non significant components not selected

for detailed testing, we employed analytical review procedures

relative to group materiality.

There were no specific components or areas included within

our group audit scope due to specific risk factors.

Work was performed over the consolidation adjustments

separately to the above scoping of components, due to the

relative simplicity of the group and the nature of the consolidation

(performed by the head office finance function with mainly UK

operations). This was performed using group materiality.

For the Eurocell plc company audit the only material transactions

and balances related to the intercompany investments (including

amounts owed by subsidiary companies), the debt held by the

Company, the related operating expenses and tax charges, and

the share based payment charge. These were all included in the

scope of our audit and tested using the company materiality by

the group audit team.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 121

The impact of climate risk on our audit

As part of our audit we made enquiries of management to

understand the process management adopted to assess the

extent of the potential impact of climate risk on the Group’s

financial statements and support the disclosures made within

the Task Force on Climate-related Financial Disclosures (‘TCFD’).

In addition to enquiries with management, we also:

• Read the governance processes in place to assess climate

risk; and

• Read additional reporting made by the entity on climate

including its sustainability section of the financial statements.

Management previously made a commitment to reduce the

emissions and energy use and a target to be net zero by 2045,

and in the current year they have added an interim target to be

met by 2034. Management has published a Net Zero transition

plan, detailing their pathway to achieving these target dates.

They have aligned these targets to the ‘Science Based Targets

initiative’ framework. The pathway includes updated objectives

for some of their ESG KPIs (e.g. greenhouse gas emissions

and energy use) in line with their overall Net Zero goal. These

commitments do not directly impact any financial results at this

stage as the impact of the net zero plan is expected to be in the

medium to longer term.

The key areas of the financial statements where management

evaluated that climate risk has a potentially significant impact are

the disclosures and assessments relating to intangible assets and

impairment particularly of goodwill.

Using our knowledge of the business we evaluated

management’s risk assessment, its estimates and resulting

disclosures where significant.

To respond to the audit risks identified in these areas we tailored

our audit approach. In particular, we:

• Challenged management on how the impact of climate

commitments made by the Group would impact the

assumptions within the discounted cash flows prepared by

management that are used in the Group’s impairment analysis,

• Challenged whether the impact of climate risk in the

Directors’ assessments and disclosures of going concern and

viability were consistent with management’s climate impact

assessment, and;

• Where appropriate, performed independent sensitivity analysis

to determine to what extent reasonably possible changes in

these assumptions could result in material changes to the

impairment headroom and assessed the appropriateness of

the associated disclosures.

We also considered the consistency of the disclosures in relation

to climate change (including the disclosures in the Task Force on

Climate-related Financial Disclosures (TCFD) section) within the

Annual Report with the financial statements and our knowledge

obtained from our audit.

Our procedures did not identify any material impact in the context

of our audit of the financial statements as a whole, or our key

audit matters for the year ended 31 December 2024.

Materiality

The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality.

These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent

of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect of misstatements,

both individually and in aggregate on the financial statements as a whole.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Financial statements – group Financial statements – company

Overall materiality £1,000,000 (2023: £760,000). £647,000 (2023: £481,000).

How we determined it 5% of underlying profit before taxation 1% of total assets

Rationale for benchmark applied We believe that underlying profit before

tax is the key measure used by the

shareholders in assessing the performance

of the group, and is a generally accepted

auditing benchmark. In 2024 underlying

profit before tax is £6.2m higher than

reported profit before tax.

We believe that total assets is the primary

measure used by the shareholders in assessing

the financial position of the entity, and is a

generally accepted auditing benchmark.

For each component in the scope of our group audit, we allocated a materiality that is less than our overall group materiality.

The range of materiality allocated across components was between £330,000 and £940,000. Certain components were audited

to a local statutory audit materiality that was also less than our overall group materiality.

We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected and

undetected misstatements exceeds overall materiality. Specifically, we use performance materiality in determining the scope

of our audit and the nature and extent of our testing of account balances, classes of transactions and disclosures, for example

in determining sample sizes. Our performance materiality was 75% (2023: 75%) of overall materiality, amounting to £750,000

(2023: £570,000) for the group financial statements and £485,250 (2023: £360,000) for the company financial statements.

Eurocell plc Annual Report and Accounts 2024122

INDEPENDENT AUDITORS’ REPORT

CONTINUED

In determining the performance materiality, we considered a

number of factors – the history of misstatements, risk assessment

and aggregation risk and the effectiveness of controls – and

concluded that an amount at the upper end of our normal range

was appropriate.

We agreed with the Audit and Risk Committee that we would report

to them misstatements identified during our audit above £50,000

(group audit) (2023: £38,000) and £30,900 (company audit)

(2023: £24,000) as well as misstatements below those amounts

that, in our view, warranted reporting for qualitative reasons.

CONCLUSIONS RELATING TO GOING CONCERN

Our evaluation of the directors’ assessment of the group’s and

the company’s ability to continue to adopt the going concern

basis of accounting included:

• Discussions with management and those charged with

governance regarding the future plans and cash flow projections

for the group. This included discussions around the forecast

cash requirements and sufficiency of available facilities to deal

with a severe but plausible downside to these projections;

• We obtained management’s analysis and cash flow model.

We checked the integrity of the model, that the base

projections reconciled to the approved budgets and were

consistent with our work in other areas, for example the

projections used in the impairment reviews;

• We considered the accuracy of management’s forecasting in

prior years by comparing actual to forecast EBITDA in the past

seven years (i.e the period for which the senior management

team has remained materially unchanged);

• We recalculated management’s assessment of the impact of

three downside scenarios (reduction in sales, increase in resin

prices and a combination of these factors) on the forecast

compliance with financial covenants and sufficiency of facilities/

available cash;

• We considered the reported headroom on facilities at each

month end for the review period;

• We have performed our own sensitivities to ascertain the levels

of underperformance in each scenario required to breach the

covenant facilities;

• We reviewed the debt facilities to ascertain if management

had correctly factored in financial covenants to their model,

including whether covenants were appropriately calculated

at each measurement point and expected to be met during

the assessment period (i.e. until 31 December 2027);

• We confirmed management’s calculations of compliance

with the covenants during 2024;

• We critically assessed the disclosures in relation to going

concern compared to the evidence obtained above, our

understanding of the group and the various requirements

detailed within Company Law, the Listing Rules and

accounting standards; and

• For the Eurocell plc company going concern assessment

we reviewed management’s analysis of the company cash

flows, checked for consistency with the consolidated model

(including the mathematical accuracy of the model), reviewed

the committed cash outflows compared to the available funds

(being cash reserves and forecast dividend receipts from

subsidiaries), considered the sufficiency of management’s

assessment of head room and critically assessed the

disclosures in note 34.

Based on the work we have performed, we have not identified

any material uncertainties relating to events or conditions that,

individually or collectively, may cast significant doubt on the

group’s and the company’s ability to continue as a going concern

for a period of at least twelve months from when the financial

statements are authorised for issue.

In 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.

However, because not all future events or conditions can be

predicted, this conclusion is not a guarantee as to the group’s

and the company’s ability to continue as a going concern.

In relation to the directors’ 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.

REPORTING ON OTHER INFORMATION

The other information comprises all of the information in the

Annual Report other than the financial statements and our

auditors’ report thereon. The directors are responsible for the

other information. Our opinion on the financial statements does

not cover the other information and, accordingly, we do not

express an audit opinion or, except to the extent otherwise

explicitly stated in this report, any form of assurance thereon.

In connection with our audit of the financial statements, 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 audit, or otherwise appears to be materially misstated.

If we identify an apparent material inconsistency or material

misstatement, we are required to perform procedures to

conclude whether there is a material misstatement of the financial

statements or a material misstatement of the other information.

If, based on the work we have performed, we conclude that

there is a material misstatement of this other information, we are

required to report that fact. We have nothing to report based on

these responsibilities.

With respect to the Strategic report and Directors’ Report,

we also considered whether the disclosures required by the

UK Companies Act 2006 have been included.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 123

Based on our work undertaken in the course of the audit, the

Companies Act 2006 requires us also to report certain opinions

and matters as described below.

Strategic report and Directors’ Report

In our opinion, based on the work undertaken in the course of the

audit, the information given in the Strategic report and Directors’

Report for the year ended 31 December 2024 is consistent with

the financial statements and has been prepared in accordance

with applicable legal requirements.

In light of the knowledge and understanding of the group and

company and their environment obtained in the course of the

audit, we did not identify any material misstatements in the

Strategic report and Directors’ Report.

Directors’ Remuneration

In our opinion, the part of the Directors’ Remuneration Report

to be audited has been properly prepared in accordance with

the Companies Act 2006.

CORPORATE GOVERNANCE STATEMENT

The Listing Rules require us to review the directors’ statements

in relation to going concern, longer-term viability and that part of

the corporate governance statement relating to the company’s

compliance with the provisions of the UK Corporate Governance

Code specified for our review. Our additional responsibilities

with respect to the corporate governance statement as other

information are described in the Reporting on other information

section of this report.

Based on the work undertaken as part of our audit, we have

concluded that each of the following elements of the corporate

governance statement is materially consistent with the financial

statements and our knowledge obtained during the audit, and

we have nothing material to add or draw attention to in relation to:

• The directors’ confirmation that they have carried out a robust

assessment of the emerging and principal risks;

• The disclosures in the Annual Report that describe those

principal risks, what procedures are in place to identify

emerging risks and an explanation of how these are being

managed or mitigated;

• The directors’ statement in the financial statements about

whether they considered it appropriate to adopt the going

concern basis of accounting in preparing them, and their

identification of any material uncertainties to the group’s

and company’s ability to continue to do so over a period

of at least twelve months from the date of approval of the

financial statements;

• The directors’ explanation as to their assessment of the group’s

and company’s prospects, the period this assessment covers

and why the period is appropriate; and

• The directors’ statement as to whether they have a reasonable

expectation that the company will be able to continue in

operation and meet its liabilities as they fall due over the period

of its assessment, including any related disclosures drawing

attention to any necessary qualifications or assumptions.

Our review of the directors’ statement regarding the longer-

term viability of the group and company was substantially less

in scope than an audit and only consisted of making inquiries

and considering the directors’ process supporting their

statement; checking that the statement is in alignment with the

relevant provisions of the UK Corporate Governance Code; and

considering whether the statement is consistent with the financial

statements and our knowledge and understanding of the group

and company and their environment obtained in the course of

the audit.

In addition, based on the work undertaken as part of our audit,

we have concluded that each of the following elements of the

corporate governance statement is materially consistent with

the financial statements and our knowledge obtained during

the audit:

• The directors’ statement that they consider the Annual Report,

taken as a whole, is fair, balanced and understandable, and

provides the information necessary for the members to assess

the group’s and company’s position, performance, business

model and strategy;

• The section of the Annual Report that describes the review

of effectiveness of risk management and internal control

systems; and

• The section of the Annual Report describing the work of the

Audit and Risk Committee.

We have nothing to report in respect of our responsibility to

report when the directors’ statement relating to the company’s

compliance with the Code does not properly disclose a departure

from a relevant provision of the Code specified under the Listing

Rules for review by the auditors.

RESPONSIBILITIES FOR THE FINANCIAL

STATEMENTS AND THE AUDIT

Responsibilities of the directors for the financial

statements

As explained more fully in the Statement of Directors’

Responsibilities, the directors are responsible for the preparation

of the financial statements in accordance with the applicable

framework and for being satisfied that they give a true and fair

view. The directors are also responsible for such internal control as

they determine is necessary to enable the preparation of financial

statements that are free from material misstatement, whether due

to fraud or error.

In preparing the financial statements, the directors are

responsible for assessing the group’s and the 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 company or to cease operations, or have no realistic

alternative but to do so.

Eurocell plc Annual Report and Accounts 2024124

INDEPENDENT AUDITORS’ REPORT

CONTINUED

Auditors’ 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

auditors’ 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.

Irregularities, including fraud, are instances of non-compliance

with laws and regulations. We design procedures in line with our

responsibilities, outlined above, to detect material misstatements

in respect of irregularities, including fraud. The extent to which our

procedures are capable of detecting irregularities, including fraud,

is detailed below.

Based on our understanding of the group and industry, we

identified that the principal risks of non-compliance with laws and

regulations related to UK employment laws and regulations, and

we considered the extent to which non-compliance might have a

material effect on the financial statements.

We also considered those laws and regulations that have a direct

impact on the financial statements such as UK tax legislation and the

Companies Act 2006. We evaluated management’s incentives and

opportunities for fraudulent manipulation of the financial statements

(including the risk of override of controls), and determined that the

principal risks were related to posting inappropriate journal entries

to revenue, assets and management bias in accounting estimates

and judgemental areas of the financial statements.

Audit procedures performed by the engagement team included:

• Enquiry of management and those charged with governance

around actual and potential frauds, litigations or claims against

or by the company;

• Reviewing financial statement disclosures and testing

supporting documentation to assess compliance with

applicable laws and regulations;

• Auditing the risk of management override of controls, through

testing journal entries (using our data analysis tools to confirm

completeness of data) by adopting a risk based approach

based on a detailed fraud assessment, testing significant

accounting estimates (as defined in the notes to the financial

statements) because of the risk of potential management bias,

and evaluating the business rationale and accounting for any

significant or unusual transactions outside the normal course

of business;

• Auditing the risk of fraud in revenue recognition by using our

data analysis tools to identify unusual credits to revenue for

further investigation;

• Performing unpredictable audit procedures, which are changed

year on year;

• Understanding of management’s internal controls designed

to prevent and detect irregularities; and

• Reviewing minutes of meetings of the Board of Directors.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 125

There are inherent limitations in the audit procedures described

above. We are less likely to become aware of instances

of non-compliance with laws and regulations that are not

closely related to events and transactions reflected in the

financial statements. Also, 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.

Our audit testing might include testing complete populations

of certain transactions and balances, possibly using data

auditing techniques. However, it typically involves selecting a

limited number of items for testing, rather than testing complete

populations. We will often seek to target particular items for

testing based on their size or risk characteristics. In other cases,

we will use audit sampling to enable us to draw a conclusion

about the population from which the sample is selected.

A further description of our responsibilities for the audit of the

financial statements is located on the FRC’s website at:

www.frc.org.uk/auditorsresponsibilities. This description forms

part of our auditors’ report.

Use of this report

This report, including the opinions, has been prepared for and

only for the company’s members as a body in accordance with

Chapter 3 of Part 16 of the Companies Act 2006 and for no other

purpose. We do not, in giving these opinions, accept or assume

responsibility for any other purpose or to any other person to

whom this report is shown or into whose hands it may come

save where expressly agreed by our prior consent in writing.

OTHER REQUIRED REPORTING

COMPANIES ACT 2006 EXCEPTION REPORTING

Under the Companies Act 2006 we are required to report

to you if, in our opinion:

• we have not obtained all the information and explanations

we require for our audit; or

• adequate accounting records have not been kept by the

company, or returns adequate for our audit have not been

received from branches not visited by us; or

• certain disclosures of directors’ remuneration specified by law

are not made; or

• the company financial statements and the part of the Directors’

Remuneration Report to be audited are not in agreement with

the accounting records and returns.

We have no exceptions to report arising from this responsibility.

APPOINTMENT

We were appointed by the members on 29 April 2015 to audit

the financial statements for the year ended 31 December 2015

and subsequent financial periods. The period of total

uninterrupted engagement is 10 years, covering the years

ended 31 December 2015 to 31 December 2024.

OTHER MATTER

The company is required by the Financial Conduct Authority

Disclosure Guidance and Transparency Rules to include these

financial statements in an annual financial report prepared under

the structured digital format required by DTR 4.1.15R – 4.1.18R

and filed on the National Storage Mechanism of the Financial

Conduct Authority. This auditors’ report provides no assurance

over whether the structured digital format annual financial report

has been prepared in accordance with those requirements.

Christopher Hibbs (Senior Statutory Auditor)

for and on behalf of PricewaterhouseCoopers LLP

Chartered Accountants and Statutory Auditors

Birmingham

19 March 2025

Eurocell plc Annual Report and Accounts 2024126

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 December 2024

		Year ended 31 December 2024			Year ended 31 December 2023
		Underlying	Non-underlying 1	Total	Underlying	Non-underlying 1	Total
	Note	£m	£m	£m	£m	£m	£m
Revenue	4, 9	3 5 7. 9	–	3 5 7. 9	36 4.5	–	3 6 4. 5
Cost of sales		(16 9 . 6)	–	(16 9 . 6)	(19 0 .7)	–	(19 0 .7)
Gross profit		18 8 . 3	–	18 8 . 3	17 3 . 8	–	17 3 . 8
Distribution costs		(25. 7)	–	(25. 7)	(25.3)	( 0 .1)	(25.4)
Administrative expenses		(13 9 . 8)	(6. 2)	(14 6 . 0)	(1 30.5)	(3.4)	(13 3 . 9)
Other income 2		–	–	–	0.4	–	0.4
Operating profit	9	22.8	(6.2)	16 . 6	18 . 4	(3.5)	14 . 9
Finance expense	10	(2 .8)	–	(2 .8)	(3.2)	–	(3.2)
Profit before tax	9	2 0.0	(6 .2)	13 . 8	15 . 2	(3.5)	11 . 7
Taxation	11	(4. 6)	1. 3	(3 .3)	(2. 9)	0.8	(2 .1)
Profit for the year and total
comprehensive income		15 .4	(4. 9)	10 . 5	12 . 3	(2 .7)	9.6
Basic earnings per share	12	14 . 4p		9.8p	11. 0 p		8.6p
Diluted earnings per share	12	14 . 3p		9 .7p	11. 0 p		8.6p

1 Non-underlying items are detailed in Note 7. The Group’s policy regarding the recognition of non-underlying items is outlined on page 131.

2 Other income in 2023 relates to amounts received under the Group’s Cyber Insurance Policy, net of excess paid, in respect of business interruption to the Group’s

continuing trading activities as a result of a cyber incident in July and August 2022.

The Notes on pages 130 to 163 are an integral part of these Consolidated Financial Statements.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 127

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 December 2024

		2024	2023
	Note	£m	£m
Assets
Non-current assets
Property, plant and equipment	14	60. 5	59.9
Right-of-use assets	15	54.3	5 5 .1
Intangible assets	16	14 . 6	15 . 8
Total non-current assets		12 9 . 4	13 0 . 8
Current assets
Inventories	18	47. 2	4 6 .7
Trade and other receivables	19	4 5.8	4 5.3
Corporation tax		1. 0	0.6
Cash and cash equivalents		0.4	0.4
Total current assets		94.4	9 3.0
Total assets		223.8	223.8
Liabilities
Current liabilities
Trade and other payables	21	(4 5 . 2)	(41. 6)
Lease liabilities	22	(12 . 5)	(12 . 9)
Bank overdrafts		(3.0)	–
Provisions	23	(0.4)	(0 .2)
Total current liabilities		(6 1 .1)	(5 4.7)
Non-current liabilities
Borrowings	20	(0. 5)	–
Lease liabilities	22	(46 . 9)	(4 5 .7)
Provisions	23	(1. 3)	(1 .1)
Deferred tax	24	(8 .6)	(8.0)
Total non-current liabilities		(5 7. 3)	(5 4.8)
Total liabilities		(11 8 . 4)	(1 09.5)
Net assets		10 5 . 4	114 . 3
Equity attributable to equity holders of the parent
Share capital	25	0 .1	0 .1
Share premium account	25	22.2	2 2. 2
Treasury shares	25	(2 .0)	(0 .1)
Share-based payment reserve	26	2 .3	0.9
Share buyback reserve	25	–	–
Retained earnings		82.8	9 1. 2
Total equity		10 5 . 4	114 . 3

The Financial Statements on pages 126 to 163 were approved and authorised for issue by the Board of Directors on 19 March 2025

and were signed on its behalf by:

Darren Waters Michael Scott

Chief Executive Chief Financial Officer

Eurocell plc Annual Report and Accounts 2024128

CONSOLIDATED CASH FLOW STATEMENT

For the year ended 31 December 2024

		Year ended	Year ended
		31 December	31 December
		2024	2023
	Note	£m	£m
Cash generated from operations	31	47. 2	54 .2
Income taxes paid		(3.0)	(1. 4)
Net cash generated from operating activities		44.2	5 2. 8
Investing activities
Purchase of property, plant and equipment		(10 . 2)	(9.0)
Purchase of intangible assets		(0 .1)	(0 .1)
Net cash flow arising on sale of business 2		–	0.8
Net cash used in investing activities		(10 . 3)	(8.3)
Financing activities
Purchase of own shares held as treasury shares	25	(1. 9)	(0.7)
Share buyback	25	(12 . 6)	–
Exercise of share options		(0 .1)	–
Proceeds/(repayment) of bank and other borrowings		1. 0	(2 1. 0)
Bank borrowings arrangement costs		–	(0. 2)
Principal elements of lease payments		(14 . 4)	(13 . 8)
Finance elements of lease payments		(2 .1)	(1. 8)
Finance expense paid		(0 .7)	(1. 4)
Dividends paid to equity Shareholders	13	(6 .1)	(10 . 3)
Net cash used in financing activities		(36.9)	(4 9. 2)
Net decrease in cash and cash equivalents 1		(3.0)	(4 .7)
Cash and cash equivalents 1 at beginning of year	32	0.4	5 .1
Cash and cash equivalents 1 at end of year	32	(2 .6)	0.4

1 Cash and cash equivalents includes bank overdrafts.

2 Cash flows arising on sale of Security Hardware in 2022.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 129

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 31 December 2024

			Share		Share-based	Share
		Share	premium	Treasury	payment	buyback	Retained	Total
		capital	account	shares	reserve	reserve	earnings	equity
	Note	£m	£m	£m	£m	£m	£m	£m
Balance at 1 January 2024		0 .1	22.2	(0 .1)	0.9	–	91. 2	11 4 . 3
Comprehensive income forthe year
Profit for the year		–	–	–	–	–	10. 5	10 . 5
Total comprehensive incomeforthe year		–	–	–	–	–	10. 5	10. 5
Contributions by and distributions
to owners
Exercise of share options	25, 26	–	–	–	(0 .1)	–	(0.2)	(0. 3)
Share-based payments	26	–	–	–	1. 5	–	–	1. 5
Purchase of own shares	25	–	–	(1.9)	–	(12 . 4)	(0. 2)	(14 . 5)
Cancellation of shares	25	–	–	–	–	12 . 4	(12 . 4)	–
Dividends paid	13	–	–	–	–	–	(6 .1)	(6 .1)
Total transactions with owners
recognised directlyin equity		–	–	(1. 9)	1. 4	–	(18 .9)	(19. 4)
Balance at 31 December 2024		0 .1	22 .2	(2. 0)	2.3	–	82. 8	10 5 . 4

			Share		Share-based	Share
		Share	premium	Treasury	payment	buyback	Retained	Total
		capital	account	shares	reserve	reserve	earnings	equity
	Note	£m	£m	£m	£m	£m	£m	£m
Balance at 1 January 2023		0 .1	22. 2	–	0.9	–	91. 7	114 . 9
Comprehensive income forthe year
Profit for the year		–	–	–	–	–	9.6	9.6
Total comprehensive income for the year		–	–	–	–	–	9.6	9.6
Contributions by and distributions to owners
Exercise of share options	25, 26	–	–	0.6	(0.8)	–	0.2	–
Share-based payments	26	–	–	–	0.8	–	–	0.8
Purchase of own shares	25	–	–	(0.7)	–	–	–	(0 .7)
Dividends paid	13	–	–	–	–	–	(10 . 3)	(10 . 3)
Total transactions with owners recognised
directlyin equity		–	–	( 0 .1)	–	–	(1 0 .1)	(10 . 2)
Balance at 31 December 2023		0 .1	22. 2	(0 .1)	0.9	–	9 1. 2	114 . 3

Eurocell plc Annual Report and Accounts 2024130

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year ended 31 December 2024

1 ACCOUNTING POLICIES (GROUP)

Corporate information

Eurocell plc (the ‘Company’) and its subsidiaries (together the ‘Group’) is a publicly listed company incorporated and domiciled in

England, United Kingdom. The registered office is located in England at the following address: Eurocell Head Office and Distribution

Centre, High View Road, South Normanton, Alfreton, Derbyshire, DE55 2DT .

The Group is principally engaged in the extrusion and supply of PVC window and building products to the new and replacement

window market and the sale of building materials across the UK.

Basis of preparation

The principal accounting policies adopted in the preparation of the Financial Statements are set out below. The policies have been

consistently applied to all years presented, unless otherwise stated.

The Group has adequate resources to continue in operational existence for the foreseeable future and, as a result of this, the going

concern basis has been adopted in preparing the Financial Statements (see below).

The Group Financial Statements have been prepared in accordance with UK-adopted International Accounting Standards and with

the requirements of the Companies Act 2006 as applicable to companies reporting under those standards.

The Financial Statements have been prepared under the historical cost convention, as modified by fair values in respect of acquisition

accounting. The functional currency is Sterling, and the Financial Statements are presented in millions, unless otherwise stated.

The preparation of the Group Financial Statements requires the use of certain critical accounting estimates. It also requires

management to exercise judgement in applying the Group’s accounting policies. The areas involving a higher degree of judgement

or complexity, or areas where assumptions and estimates are significant to the Financial Statements, are disclosed in Note 2.

Basis of consolidation

The Consolidated Financial Statements comprise the Financial Statements of the Company and its subsidiaries at 31 December 2024

and present the results as if they formed a single entity. Where the Company has power, either directly or indirectly, to govern the

financial and operating policies of another entity or business so as to obtain benefits from its activities, it is classified as a subsidiary.

Subsidiaries are consolidated from the date of acquisition, being the date on which the Group obtained control, and continue to be

consolidated until the date when such control ceases. Intercompany transactions and balances, unrealised gains and losses resulting

from intra-Group transactions and dividends are eliminated in full.

The Group’s functional currency is Sterling. The vast majority of the Group’s revenues are denominated in Sterling, and as a result

the consolidation of non-UK revenues has minimal foreign exchange impact.

The Consolidated Financial Statements incorporate the results of business combinations using the purchase method. In the

Consolidated Statement of Financial Position, the acquiree’s identifiable assets, liabilities and contingent liabilities are initially

recognised at their fair values at the acquisition date.

All dormant subsidiaries prepare and file financial statements in accordance with Section 480 of the Companies Act 2006,

which are filed with the registrar at Companies House.

Going concern

The Group funds its activities through a £75 million Revolving Credit Facility, provided by Barclays, NatWest and Bank of Ireland,

which matures in May 2027. The facility includes two key financial covenants, which are tested at 30 June and 31 December each

year on a pre-IFRS 16 basis. These are that net debt should not exceed three times adjusted EBITDA (Leverage), and that adjusted

EBITDA should be at least four times the interest charge on the debt (Interest Cover). Adjusted EBITDA is defined as operating profit

before depreciation, amortisation and non-underlying items. See alternative performance measures on page 136.

No covenants were breached during the year ended 31 December 2024. For the next measurement period, being 30 June 2025,

and going forward, the Group expects to comply with its covenants.

In assessing going concern, the Directors have considered financial projections for the period to December 2026, which is consistent

with the Board’s strategic planning horizon and reflects a period of at least 12 months from the date of approval of these Financial

Statements. These forecasts have been compiled based on the best estimates of the Group’s commercial and operational teams.

This includes a severe but plausible ’Downside’ scenario, which reflects demand for the Group’s products being severely weakened.

In all scenarios tested, including sensitivities reducing sales forecasts to 10% below management’s estimates for the period 2025-

26, key raw material prices increasing by 33% over that period and both scenarios combined. The Group operates with significant

headroom on its RCF facility and remains compliant with its original covenants.

After reviewing the Group’s projected financial performance and financing arrangements, the Directors consider that the Group

has adequate resources to continue operating and that it is therefore appropriate to continue to adopt the going concern basis

in preparing these Financial Statements.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 131

Changes in accounting policies and disclosures applicable to the Company and the Group

The Group has applied the following amendments for the first time for their financial reporting period commencing 1 January 2024,

with no material impact:

• Classification of Liabilities as Current or Non-current (Amendments to IAS 1)

• Lease Liability in a Sale and Leaseback (Amendments to IFRS 16)

• Supplier Finance Arrangements (Amendments to IAS 7 and IFRS 7)

• Non-current Liabilities with Covenants (Amendments to IAS 1).

The following new accounting standards, amendments to 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:

• Lack of Exchangeability (Amendments to IAS 21)

• Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and 7)

• IFRS 18 Presentation and Disclosure in Financial Statements

• IFRS 19 Subsidiaries without Public Accountability: Disclosures.

The IFRIC agenda decision on segmental reporting was issued in July 2024, the Group is currently assessing relevant material items

of income and expense for future disclosures within the segmental disclosures.

These standards, amendments or interpretations are not expected to have a material impact on the Group in the current or future

reporting periods and on foreseeable future transactions.

Revenue

The Group manufactures and distributes a range of building plastic materials, along with associated ancillary products, via direct sales

to its fabricator customers and through its branch network. Revenue is recognised when control of the products has transferred.

Control is considered to have transferred once the customer has taken delivery of the products, or has collected them from the

branch, has full discretion over the future use of those products, and where there is no unfulfilled obligation that could affect the

customer’s acceptance of the products.

Revenue is recognised when the goods are dispatched to, or collected by, the customer. Revenue is based upon the price specified

on the customer’s invoice, which is determined with reference to a price list specific to each customer or category of customers.

A receivable is recognised on the transfer of the products, as this is the point at which consideration is deemed to be unconditional.

There are no variable elements to the consideration received that require estimation. No significant element of financing is present

as sales are made with a credit term of 30 days end of month, which is consistent with market practice.

Where costs are incurred by the Group in securing a contract to supply products, those costs, (subject to a de-minimis limit),

are recognised as customer contract assets (within trade and other receivables) in the Consolidated Statement of Financial Position.

The balance is amortised over the period in which revenue pertaining to those costs is recognised, which in the vast majority of

cases is four years. Reviews are performed to assess expected credit losses and balances adjusted if necessary.

Due to the fact that the Group’s customers typically collect or take delivery of products for immediate use in their intended purpose,

the likelihood of items being returned is small. Therefore, it is highly probable that a significant reversal of revenue will not occur.

The Group’s obligations to repair or replace faulty manufactured products under the standard warranty terms is recognised as a

provision, see Note 23.

Non-underlying items

The Group presents some material items of income and expense as non-underlying items. This is done when, in the opinion of the

Directors, the nature of the circumstances merit separate presentation in the Financial Statements. This includes, but is not limited to,

costs incurred in the act of securing debt or equity funding, acquisition costs, non-recurring costs arising from business restructuring

and expensed software-as-a-service costs incurred in the process of developing strategic IT systems (see Software on page 132).

This treatment allows users of the Financial Statements to better understand the elements of financial performance in the year,

it facilitates comparison with prior periods, and it helps in understanding trends in financial performance. Further details are

provided in Note 7.

Eurocell plc Annual Report and Accounts 2024132

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

1 ACCOUNTING POLICIES (GROUP) CONTINUED

Business combinations and goodwill

Business combinations are accounted for using the acquisition method. The cost of acquisition is measured as the aggregate of the

fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued by the acquirer,

in exchange for control of the acquiree. Direct costs of acquisition are recognised immediately as an expense.

Goodwill is initially measured at cost, being the excess of the cost of a business combination over the fair value of the identifiable

assets, liabilities and contingent liabilities acquired at the acquisition date. Goodwill is capitalised as an intangible asset with any

impairment in carrying value being charged to the Consolidated Statement of Comprehensive Income. Where the fair value of

identifiable assets, liabilities and contingent liabilities exceeds the fair value of consideration paid, the excess is credited in full to

the Consolidated Statement of Comprehensive Income on the acquisition date.

Externally acquired intangible assets

Externally acquired intangible assets are initially recognised at cost and subsequently amortised on a straight-line basis over their

useful economic lives.

Intangible assets are recognised on business combinations if they are separable from the acquired entity or give rise to other

contractual/legal rights. The amounts ascribed to such intangibles are arrived at by using appropriate valuation techniques. Useful

economic lives and the methods used to determine the cost of intangibles acquired in a business combination are as follows:

Intangible asset	Useful economic life	Valuation method
Software	5 to 10 years	Cost to acquire
Technology-based	10 to 17 years	Cost to acquire
Customer-related	5 to 10 years	Cost to acquire
Marketing-related	10 to 15 years	Cost to acquire

The amortisation charge for the year is included within administration costs, within the Consolidated Statement of Comprehensive Income.

Software

Costs associated with maintaining computer software programmes are recognised as an expense in the underlying income statement

as they are incurred. Development costs that are directly attributable to the design and testing of identifiable and unique software

products that are controlled by the Company are recognised as intangible assets, and amortised on a straight-line basis over their

estimated useful lives. Any development costs that directly relate to software-as-a-service (‘SaaS’) arrangements are expensed as

incurred unless the Company has control of the underlying SaaS software. Where expensed SaaS costs are incurred in the process of

developing strategic IT systems, which for the avoidance of doubt comprises the Group’s new Enterprise Resource Planning and

HR Information Systems, such costs are classified as non-underlying items as they are material in size and not part of the normal

costs of operating the business.

Impairment of tangible assets, intangible assets, right-of-use assets and investments

Impairment tests on non-current assets are undertaken annually at the financial year-end or at any other time when an indication of

impairment arises. Where the carrying value of an asset exceeds its recoverable amount (i.e. the higher of value-in-use and fair value

less costs to sell), the asset is written down accordingly.

Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the smallest

group of assets to which it belongs, for which there are separately identifiable cash flows – its cash-generating unit (‘CGU’). Goodwill

is allocated on initial recognition to each of the Group’s CGUs that are expected to benefit from the synergies of the combination

giving rise to the goodwill. Impairment is not considered at an individual branch level (‘Building Plastics: CGU’) as acquired goodwill

is not separately identifiable on that basis.

Individual right-of-use lease property assets relating to the Group’s branch network are also tested for impairment when an indication

of impairment arises, such as a branch becoming loss-making. In considering individual branch performance, central overheads are

allocated to each branch in proportion to sales.

Where it is considered probable that climate change will have a measurable and materially adverse impact on the future cash flows

of a CGU or non-current asset, estimated cash flows and/or useful economic lives are reduced accordingly.

Impairment charges are included in the Consolidated Statement of Comprehensive Income, except to the extent they reverse gains

previously recognised in Other Comprehensive Income. An impairment loss recognised for goodwill is not reversed.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 133

Property, plant and equipment

Items of property, plant and equipment are initially recognised at cost. As well as the purchase price, cost includes directly attributable

costs and the estimated present value of any future unavoidable costs of dismantling and removing items. The corresponding liability

is recognised within provisions.

Freehold land is not depreciated. Assets in the course of construction are not depreciated until they are in a condition that would

allow them to be deployed in their intended use without further changes to their condition. Depreciation is provided on all other

items of property, plant and equipment so as to write off their cost less residual value over their expected useful economic lives.

It is provided at the following rates:

Asset class	Depreciation policy
Freehold property	2.5% per annum straight-line
Leasehold improvements	Equal instalments over the period of the lease
Plant and machinery
Mixing plant	Between 20% and 25% per annum straight-line
Extruders	13 years based on production usage on a straight-line basis
Stillages and tooling	5 to 10 years based on production usage on a straight-line basis
Other	Between 10% and 25% per annum straight-line
Motor vehicles	Between 20% and 25% per annum straight-line

Right-of-use lease assets

Right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at, or before,

the commencement day and any initial direct costs. They are subsequently measured at cost less accumulated depreciation

and impairment losses. Discount rates are based on our external financing rate and then a lease-specific adjustment is applied.

Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If a lease transfers

ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group expects to exercise a purchase option,

the related right-of-use asset is depreciated over the useful life of the underlying asset. Depreciation starts at the commencement

date of the lease. Leases are assessed for impairment based on value-in-use and impaired where this is below book value.

Reversals of impairments can occur where assets are subsequently found to have further value-in-use.

Inventories

Inventories are initially recognised at cost, and subsequently at the lower of cost and net realisable value. Cost comprises all costs of

purchase and conversion, and other costs incurred in bringing the inventories to their present location and condition. In determining

the cost of raw materials, consumables and goods purchased for resale, the weighted average purchase price is used. For work in

progress and finished goods, cost is taken as production cost, which includes a proportion of attributable overheads.

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.

Eurocell plc Annual Report and Accounts 2024134

1 ACCOUNTING POLICIES (GROUP) CONTINUED

Financial assets

The Group records all of its financial assets at amortised cost and has not classified any of its financial assets at fair value through

profit and loss or other comprehensive income. The Group’s financial assets comprise trade and other receivables and cash and

cash equivalents in the balance sheet. These are non-derivative financial assets with fixed or determinable payments that are not

quoted in an active market. They arise principally through the provision of goods and services to customers, but also incorporate

other types of contractual monetary asset. They are initially recognised at fair value plus transaction costs that are directly attributable

to their acquisition or issue and are subsequently carried at amortised cost using the effective interest rate method, less provision

for impairment. Customer rebates are offset against receivable amounts in line with the terms of the customer agreements.

The Group applies the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance for

trade receivables.

Expected loss rates are derived based upon the payment profile of sales over the three-year period up to the reporting date, and the

corresponding credit losses experienced. These rates are then adjusted to reflect current and forward-looking information on macroeconomic

factors affecting the ability of customers to settle receivables, including GDP, the rate of unemployment, new housing starts, interest rates and

household disposable income. Insured balances are excluded to the extent that no loss would arise in the event of default by the customer.

Where the adjusted loss rates are different from the original estimate, there is an impact on the carrying value of trade receivables and

the amount credited or charged on a net basis to operating expenses within the Consolidated Statement of Comprehensive Income.

While cash and cash equivalents and contract assets are also subject to the impairment requirements of IFRS 9, the identified

impairment loss was immaterial.

Cash and cash equivalents includes cash in hand, deposits held at call with banks, other short-term highly liquid investments with

original maturities of three months or less from inception, and – for the purpose of the statement of cash flows – bank overdrafts.

Bank overdrafts are shown within current liabilities in the balance sheet.

Financial liabilities

The Group classifies its financial liabilities as financial liabilities measured at amortised cost, which include the following items:

• Bank borrowings which are initially recognised at fair value net of any transaction costs directly attributable to the issue of the instrument.

Such interest-bearing liabilities are subsequently measured at amortised cost using the effective interest rate method, which ensures

that any interest expense over the period to repayment is at a constant rate on the balance of the liability carried in the balance sheet

• Trade payables and other short-term monetary liabilities, which are initially recognised at fair value and subsequently carried at

amortised cost using the effective interest method.

Taxation

Tax on the profit for both the current and prior periods comprises both current and deferred tax and is recognised in the Consolidated

Statement of Comprehensive Income, except to the extent that it relates to items recognised directly in equity.

Current tax is the expected tax payable on taxable income for the year, using tax rates that have been enacted at the balance sheet

date, and any adjustment to tax payable in respect of prior years.

The Group recognises a current tax asset in respect of relief claimed under the Patent Box when the inflow of economic benefits

arising from that asset is virtually certain, deemed to be the submission of a claim to HM Revenue and Customs.

Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the balance sheet differs from

its tax base, except for differences arising on:

• the initial recognition of goodwill

• the initial recognition of an asset or liability in a transaction, which is not a business combination, and at the time of the transaction

affects neither accounting nor taxable profit

• investments in subsidiaries and jointly controlled entities where the Group is able to control the timing of the reversal of the

difference and it is probable that the difference will not reverse in the foreseeable future.

Recognition of deferred tax assets is restricted to those instances where it is probable that future taxable profits will arise,

against which the difference can be utilised.

The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted by the reporting

date and are expected to apply when the deferred tax liabilities/assets are settled/recovered.

Deferred tax assets and liabilities are offset when the Group has a legally enforceable right to offset current tax assets and liabilities

and the deferred tax assets and liabilities relate to taxes levied by the same tax authority on either:

• the same taxable Group company

• different Group entities which intend either to settle current tax assets and liabilities on a net basis, or to realise the assets and settle

the liabilities simultaneously, in each future period in which significant amounts of deferred tax assets or liabilities are expected to

be settled or recovered.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 135

Lease liabilities

The Group leases certain properties, vehicles and material handling equipment. The Group has no leases previously classified as

finance leases. Liabilities for leases previously classified as operating leases have been measured in accordance with IFRS 16 using

the modified retrospective approach.

In applying IFRS 16, the Group has taken advantage of a number of practical expedients permitted by the standard:

• the application of a single discount rate to a portfolio of leases with reasonably similar characteristics

• reliance on previous assessments as to whether leases are onerous

• accounting for leases with a remaining term of less than 12 months as short-term leases

• the exclusion of initial direct costs in measuring the right-of-use asset at the date of initial application.

Leases with a remaining term of less than 12 months have been accounted for as short-term leases. Leased assets with a value

of less than £5,000 are omitted on the basis of materiality.

The Group assesses whether a contract is or contains a lease, at inception of a contract. The Group recognises a right-of-use asset and

a corresponding lease liability with respect to all lease agreements in which it is the lessee except for short-term leases (defined as leases

with a lease term of 12 months or less) and leases of low-value assets (defined as leases with a value of less than £5,000). For these

leases, the Group recognises the lease payments as an operating expense on a straight-line basis over the term of the lease unless

another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date,

discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the Group uses its incremental borrowing

rate. The incremental borrowing rate is calculated based upon a combination of the risk-free rate, financing and asset-specific credit

spreads, adjusted for the term of each lease.

Lease payments included in the measurement of the lease liability comprise fixed lease payments, less any lease incentives. The lease

liability is subsequently measured by increasing the carrying amount to reflect interest on the lease liability (using the effective interest

method) and by reducing the carrying amount to reflect the lease payments made.

The principal and finance elements of lease payments are presented separately on the face of the Consolidated Cash Flow Statement

within financing activities.

Provisions

A provision is recognised in the balance sheet when the Group has a present legal or constructive obligation as a result of a past

event, and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material,

provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments

of the time value of money and, when appropriate, the risks specific to the liability.

The Group has recognised provisions for liabilities of uncertain timing or amount in respect of leasehold dilapidations and warranty

claims. The provision is measured at the best estimate of the expenditure required to settle the obligation at the reporting date,

discounted at a pre-tax rate as described above.

Dilapidations provisions represent the Directors best estimate of the cost associated with the obligation using historical costs.

Known specific obligations relating to repairs required or structural changes made to a building are recognised as soon as the timing

and amount of the liability can be reliably estimated.

Warranty provisions are recognised to cover known potential warranty issues. The provision represents the Directors best estimate

of the costs associated with these obligations.

Share capital

The Group’s ordinary shares are classified as equity instruments.

Treasury shares

Treasury shares are held by the Company and the Company’s Employee Benefit Trust for the purpose of satisfying awards under

the Group’s various share-based payment schemes.

Shares in relation to the Employee Benefit Trust are acquired from the market and are held in treasury until such time as they are

issued to share scheme participants. Treasury shares held by the Company are acquired through the share buyback schemes.

Any shares not yet issued to employees at the end of the reporting period are shown as treasury shares in the Financial Statements.

Shares issued to employees are recognised on a first-in first-out basis. Under the terms of the trust deed, the Group is required to

provide the trust with the necessary funding for the acquisition of the shares.

Dividends

Dividends are recognised when they become legally payable. In the case of interim dividends to equity shareholders, this is when

paid. In the case of final dividends, this is when approved by the Shareholders at the Annual General Meeting.

Eurocell plc Annual Report and Accounts 2024136

1 ACCOUNTING POLICIES (GROUP) CONTINUED

Retirement benefits: defined contribution scheme

The Group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group in

an independently administered fund. The amount charged to the Consolidated Statement of Comprehensive Income represents the

contributions payable to the scheme in respect of the accounting period. The Group has no obligation to pay future pension benefits.

Foreign currency

The Group’s Financial Statements are presented in Sterling. For each entity, the Group determines the functional currency, and items

included in the Financial Statements of each entity are measured using that functional currency.

Transactions entered into by Group entities in a currency other than the currency of the primary economic environment in which they

operate (their ‘functional currency’) are recorded at the prevailing rate when the transactions occur. Foreign currency monetary assets

and liabilities are translated at the rates ruling at the reporting date. Exchange differences arising on the retranslation of unsettled

monetary assets and liabilities are recognised immediately in the Consolidated Statement of Comprehensive Income.

Share-based payment transactions

The Group has applied the requirements of IFRS 2 Share-based Payment.

Equity-settled share-based payments are measured at fair value at the date of grant. The fair value is determined at the grant date using

the Black–Scholes valuation model and equity-settled share-based payments are expensed on a straight-line basis over the vesting

period, based upon the Company’s estimate of the shares that will eventually vest and adjusted for the effect of non-market-based

vesting conditions.

Fair value is measured based on the value of options over shares on the date of grant and the likelihood of all or part of the option vesting.

Current tax relief is available as shares vest based on the value at the date of vesting. A deferred tax asset is recognised at grant date

based on the number of shares expected to be issued, at the value at which they are expected to be issued, proportioned in line with

the vesting period.

Alternative performance measures

The Group uses alternative performance measures alongside statutory measures to facilitate a better understanding of financial

performance and comparison with prior periods, and in order to provide audited financial information, against which the Group’s bank

covenants, which are all measured on a pre-IFRS 16 basis, can be assessed.

EBITDA is defined as operating profit before depreciation and amortisation charges. Pre-IFRS 16 EBITDA is stated inclusive of

operating lease rentals under IAS 17 Leases.

Adjusted EBITDA, profits and earnings per share exclude non-underlying items. Adjusted profit measures allow users of the Financial

Statements to better understand financial performance in the year by removing certain material items of income and expense that are

unusual due to their nature or infrequency, thus facilitating better comparison with prior periods.

Covenants are assessed on a pre-IFRS 16 adjusted EBITDA, continuing basis.

	2024	2023
	£m	£m
Operating profit	16.6	14.9
Depreciation and amortisation	25.3	24.7
EBITDA	41.9	39.6
Non-underlying items	6.2	3.5
Adjusted EBITDA	48.1	4 3 .1
Operating lease rentals under IAS 17	(16.3)	(15.2)
Pre-IFRS 16 adjusted EBITDA	31.8	27.9

Pre-IFRS 16 total net debt/(cash) is defined as total borrowings and lease liabilities less cash and cash equivalents and deferred

consideration, excluding the impact of leases recognised under IFRS 16 Leases.

	2024	2023
	£m	£m
Total net debt	62.5	58.2
Lease liabilities	(59.4)	(58.6)
Pre-IFRS 16 net debt/(cash)	3.1	(0.4)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 137

2 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

The Group makes certain estimates and judgements regarding the future. Estimates and judgements are continually evaluated based

on historical experience and other factors, including expectations of future events, that are believed to be reasonable under the

circumstances. In the future, actual experience may differ from these estimates and judgements.

Critical estimates and judgements

The estimates and judgements that have a significant risk of causing a material adjustment to the carrying amounts of assets and

liabilities within the next financial year are discussed below.

Estimates

Recoverability of trade receivables

The Group applies the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance for

trade receivables. Expected loss rates are derived based upon the payment profile of sales over the three-year period up to the

reporting date, and the corresponding credit losses experienced. These rates are then adjusted to reflect current and forward-looking

information on macroeconomic factors affecting the ability of customers to settle receivables, including GDP, the rate of unemployment,

new housing starts, interest rates and household disposable income.

Where the adjusted loss rates are different from the original estimate, there is an impact on the carrying value of trade receivables and

the amount credited or charged on a net basis to operating expenses within the Consolidated Statement of Comprehensive Income.

The key judgement is the extent to which macroeconomic factors impact upon the recoverability of trade receivables. The key

estimate is the adjusted loss rate applied to each age category.

If loss rates for current receivables were, on average, 750 basis points higher than current estimates, the provision for impairment

would increase by approximately £1.0 million. Further disclosures relating to trade receivables are provided in Note 19.

Judgements

Asset impairment

The right of use asset impairment charge arises following a dispute with the landlord at a secondary warehouse in Derbyshire, where

there was significant deterioration to the flooring. Following legal advice, the Group terminated the lease. The landlord has contested

the termination and issued proceedings for unpaid rent. A mediation process is expected to commence shortly with potential for a

court case to follow if this is unsuccessful. With the site not currently in condition for use and the outcome of the dispute uncertain,

the lease asset has been impaired in full. The liability for future rentals (£3.1 million), remains on the balance sheet. The impairment

may be reversed in future periods, or the liability released, depending on the outcome of the dispute.

3 FINANCIAL INSTRUMENTS – RISK MANAGEMENT

The Group is exposed through its operations to the following financial risks:

• credit risk

• market risk

• foreign exchange risk

• liquidity risk.

In common with all other businesses, the Group is exposed to risks that arise from its use of financial instruments. The Group does

not consider there to be any significant concentration of risk. This note describes the Group’s objectives, policies and processes for

managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented

throughout these Financial Statements. There have been no substantive changes in the Group’s exposure to financial instrument

risks, its objectives, policies and processes for managing those risks, or the methods used to measure them from previous periods

unless otherwise stated in this note.

Principal financial instruments

The principal financial instruments used by the Group, from which financial instrument risk arises, are as follows:

• trade and other receivables

• cash and cash equivalents

• deferred consideration

• trade and other payables

• bank overdrafts

• floating-rate bank loans

• lease liabilities.

The Group finances its activities using cash generated from operations and its Revolving Credit Facility. It does not use invoice

discounting or any other financing facilities. The fair value for cash and cash equivalents is approximate to its book value.

Eurocell plc Annual Report and Accounts 2024138

3 FINANCIAL INSTRUMENTS – RISK MANAGEMENT CONTINUED

Principal financial instruments continued

A summary of the financial instruments held by category is provided below:

	2024	2023
Financial assets	£m	£m
Cash and cash equivalents	0.4	0.4
Trade and other receivables	35.2	3 5.1
Total financial assets	35.6	35.5

	2024	2023
Financial liabilities	£m	£m
Trade and other payables	41.6	39.6
Lease liabilities	59.4	58.6
Bank overdrafts	3.0	–
Borrowings	1.0	–
Total financial liabilities	105.0	98.2

The analysis above does not correspond to the values reported in the Consolidated Statement of Financial Position as excluded from

the analysis above are assets and liabilities from which no future cash flows are expected to arise, including prepayments, contract

assets, rent-free periods on leased properties, and unamortised arrangement costs relating to the Group’s borrowings.

Impairment of financial assets

Impairments of trade receivables are outlined in Note 19. No further impairments to financial assets are considered necessary.

The Group applies the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance for

trade receivables.

General objectives, policies and processes

The Board has overall responsibility for the determination of the Group’s risk management objectives and policies and, whilst retaining

ultimate responsibility for them, it has delegated the authority for designing and operating processes that ensure the effective

implementation of the objectives and policies to the Group’s finance function.

The Board receives monthly reports from the Chief Financial Officer through which it reviews the effectiveness of the processes put

in place and the appropriateness of the objectives and policies it sets. These are then discussed at regular Board meetings.

The overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the Group’s

competitiveness and flexibility. Further details regarding these policies are set out below:

Credit risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual

obligations. The Group is mainly exposed to credit risk through its trade receivables arising from its normal commercial activities.

It is Group policy, implemented locally, to assess the credit risk of new customers before entering into contracts.

Existing credit risks associated with trade receivables are managed in line with Group policies as discussed in the financial assets

section of accounting policies. Credit risk also arises from cash and cash equivalents and deposits with banks and financial

institutions. This risk is mitigated by ensuring that deposits are only made with banks and financial institutions with a good rating

issued by an industry-recognised independent third party (e.g. Standard and Poor’s).

Further disclosures regarding financial assets are provided in Note 19.

Market risk

The Group is exposed to market risk from bank borrowings, which incur variable interest rate charges linked to base rate plus

a margin. The Group’s objective is to manage the interest cost of the Group within the constraints of its financial covenants and

forecasts. It does this through regular reporting and monitoring of operating cash flows, effective working capital management

and close controls over the authorisation of capital expenditure.

If variable interest rates were 1,500 basis points higher/lower, the Group’s finance expense would increase/decrease by £200,000.

During 2024 and 2023 the Group’s borrowings, at variable rate were denominated in Sterling. Further disclosures relating to bank

borrowings are provided in Note 20.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 139

Foreign exchange risk

Foreign exchange risk is the risk that the fair value of a financial instrument or future cash flow will fluctuate because of changes in

foreign exchange rates. The Group’s exposure to foreign exchange risk arises when individual Group entities enter into transactions

denominated in a currency other than their functional currency. The Group manages its exposure to fluctuations in currency rates by

wherever possible negotiating both purchases and sales to be denominated in Sterling. The profit or loss arising from likely changes

in foreign exchange is not significant.

Liquidity risk

Liquidity risk arises from the Group’s management of working capital and the finance charges and principal repayments on its debt

instruments. It is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due.

The Group’s policy is to ensure that it will always have sufficient cash to allow it to meet its liabilities when they become due. To

achieve this aim, cash flow forecasts are prepared and updated on a regular basis to ensure that the Group has adequate headroom

in its facilities. The Board receives monthly updates on the Group’s liquidity position and any issues are reported by exception.

At the end of the financial year, the most recent cash flow projections indicated that the Group expected to have sufficient liquid

resources to meet its obligations under all reasonably foreseeable circumstances.

The following table sets out the contractual maturities (representing undiscounted contractual cash flows) of financial liabilities:

			Between	Between	Between
		Up to 3	3 and 12	1 and 2	2 and 5	Over
	Total	months	months	years	years	5 years
At 31 December 2024	£m	£m	£m	£m	£m	£m
Trade and other payables	43.5	43.5	–	–	–	–
Lease liabilities	66.1	3.1	10.7	15.1	21.6	15.6
Bank overdrafts	3.0	3.0	–	–	–	–
Borrowings	1.0	–	–	–	1.0	–
Total	113 .6	49.6	10.7	15.1	22.6	15.6

			Between	Between	Between
		Up to 3	3 and 12	1 and 2	2 and 5	Over
	Total	months	months	years	years	5 years
At 31 December 2023	£m	£m	£m	£m	£m	£m
Trade and other payables	39.6	39.6	–	–	–	–
Lease liabilities	64.2	4.6	9.8	8.4	25.8	15.6
Borrowings	–	–	–	–	–	–
Total	103.8	44.2	9.8	8.4	25.8	15.6

Excluded from the analysis above are assets and liabilities from which no future cash flows are expected to arise.

Capital management

The Group’s objective when managing capital, which is deemed to be total equity plus total debt and which was £168.3 million

(2023: £172.9 million) at the balance sheet date, is to safeguard the Group’s ability to continue as a going concern, through the

optimisation of the debt and equity balance, and to maintain good headroom on its debt facilities and financial covenants. The Group

manages its capital structure and makes appropriate decisions in the light of current economic conditions and its strategic objectives.

The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and sustain the

future development of the business.

The funding requirements of the Group are met by the utilisation of external borrowings together with available cash.

A key objective of the Group’s capital management is to maintain comfortable headroom over the covenants set out in its existing

facility agreements.

The financial covenants which are in place, all measured on a pre-IFRS 16 basis, are as follows:

• Leverage: the ratio of total net debt to consolidated adjusted EBITDA of any relevant period of not more than 3:1

• Interest cover: the ratio of adjusted EBITDA to net interest payable in respect of any relevant period of not less than 4:1.

Covenants are measured at half-year and year-end on a rolling 12-month basis. As at 31 December 2024, Leverage and Interest

Cover were 0.1:1 and 45:1 respectively (2023: 0.0:1 and 20:1). The Group operated well within the terms of its covenants throughout

the current and prior periods. The Group anticipates that it will comfortably meet all future covenant obligations.

Eurocell plc Annual Report and Accounts 2024140

3 FINANCIAL INSTRUMENTS – RISK MANAGEMENT CONTINUED

Capital management continued

The following table sets out the Group’s foreign currency denominated monetary assets and monetary liabilities at the reporting date:

		As at 31 December 2024
	GBP	EUR	USD	Total
	£m	£m	£m	£m
Trade and other receivables	35.0	0.2	–	35.2
Cash and cash equivalents	0.3	0.1	–	0.4
Bank overdrafts	(3.0)	–	–	(3.0)
Lease liabilities	(59.1)	(0.3)	–	(59.4)
Other interest-bearing borrowings	(1.0)	–	–	(1.0)
Trade and other payables	(41.1)	(0.5)	–	(41.6)
	(68.9)	(0.5)	–	(69.4)

		As at 31 December 2023
	GBP	EUR	USD	Total
	£m	£m	£m	£m
Trade and other receivables	35.0	0.1	–	35.1
Cash and cash equivalents	0.4	–	–	0.4
Lease liabilities	(58.2)	(0.4)	–	(58.6)
Trade and other payables	(39.0)	(0.6)	–	(39.6)
	(61.8)	(0.9)	–	(62.7)

4 REVENUE

Revenue arises from:

	2024	2023
	£m	£m
Sale of goods	357.9	364.5

External revenue by destination:

	2024	2023
	£m	£m
United Kingdom	353.1	359.3
European Union	4.1	4.1
Rest of World	0.7	1.1
	357.9	364.5

There are no customers with sales in excess of 10% of total Group revenues.

Revenue is disclosed net of contract asset amortisation and related expenses in the year of £1.5 million (2023: £1.5 million).

Further details are provided in Note 19.

5 AUDITOR’S REMUNERATION

Total amounts payable to the Group’s auditors were as follows:

	2024	2023
	£000	£000
Audit of these Financial Statements	112	100
Amounts receivable by auditors and their associates in respect of:
Audit of Financial Statements of subsidiaries pursuant to legislation	254	238
Audit-related assurance services	77	70
	443	408

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 141

6 EXPENSES BY NATURE

	2024	2023
	£m	£m
Depreciation of property, plant and equipment (Note 14)	9.6	9.3
Depreciation of right-of-use assets (Note 15)	14.4	13.7
Amortisation of intangible assets (Note 16)	1.3	1.7
Impairment of property, plant and equipment and right-of-use assets	3.3	0.3
Other non-underlying operating expenses (Note 7)	3.0	3.2
Cost of inventories	153.2	169.5
Other variable costs	16.4	21.2
Employee benefits expense (Note 8)	89.2	85.2
Short-term lease rentals	2.2	2.0
Other expenses	48.7	43.9
Total cost of sales, distribution costs and administration expenses	341.3	350.0

7 NON-UNDERLYING ITEMS

Amounts included in the Consolidated Statement of Comprehensive Income are as follows:

	2024	2023
	£m	£m
Restructuring costs	–	2.7
Asset impairment charges	3.2	–
Strategic IT expenses	2.2	0.8
Acquisition costs	0.8	–
Non-underlying operating expenses	6.2	3.5
Taxation	(1.3)	(0.8)
Impact on profit after tax	4.9	2.7

Asset impairment charges

The right-of-use asset impairment charge arises following a dispute with the landlord at a secondary warehouse in Derbyshire, where

there was significant deterioration to the flooring. Following legal advice, the Group terminated the lease. The landlord has contested

the termination and issued proceedings for unpaid rent. A mediation process is expected to commence shortly, with the potential for

a court case to follow if this is unsuccessful.

The Group determined that the landlord issuing legal proceedings represented an impairment trigger for the right-of-use asset,

which had a net book value of £3.2 million at that time. With the site not currently in condition for use and the outcome of the dispute

uncertain, the lease asset has been impaired in full (a non-cash item). The net book value of the lease liability at the balance sheet

date is £3.1 million. The Group expects the landlord to incur the cost of remediation, and therefore no further liability has been

recognised. The impairment may be reversed in future periods, or the liability released, depending on the outcome of the dispute.

Strategic IT expenses

Strategic IT expenses of £2.2 million (2023: £0.8 million), include cloud computing costs involving ‘Software as a Service’

arrangements and internal resourcing costs which are expensed as incurred rather than being capitalised as intangible assets

(see Note 1).

Our strategic IT projects comprise a new customer-facing website and an employee management system (both now substantially

complete) and, most significantly, the replacement of the Group’s Enterprise Resource Planning (‘ERP’) system. Such items are

considered to be non-underlying in nature because they relate to multi-year programmes to deliver strategic IT implementations which

are material in size, with overall spend estimated to be in the region of £10 million over the 2024–26 period. The implementation is on

track and, as previously reported, we estimate the transition to be completed around mid-2026.

Acquisition costs

In March 2025, the Group completed the acquisition of the Alunet Group. Acquisition-related expenses of £0.8 million were incurred

in the process, comprising deal advisory, legal and due diligence costs.

Eurocell plc Annual Report and Accounts 2024142

7 NON-UNDERLYING ITEMS CONTINUED

Prior year restructuring costs

Restructuring costs in 2023 related to redundancy payments and related employee benefit termination costs, with 119 roles impacted

at a one-off cost of £2.7 million. These costs were classified as non-underlying as they related to roles that no longer exist within the

organisation and therefore would not re-occur in future reporting periods. Also included is a credit of £0.2 million in respect of the

release of a provision relating to a restructuring exercise announced in 2022 and completed in early 2023.

Impact on cash flow

Of the £6.2 million non-underlying expenses recognised, £1.9 million was settled in cash at 31 December 2024 and £3.2 million

related to non-cash impairment charges. The remaining £1.1 million will be settled within the next twelve months.

Of the £3.5 million non-underlying expenses recognised in 2023, £3.2 million had been settled in cash at 31 December 2024.

The remaining £0.3 million relates to non-cash asset impairment charges.

8 EMPLOYEE BENEFITS EXPENSE

	2024	2023
	£m	£m
Staff costs (including Directors) comprise:
Wages and salaries	76.3	73.7
Share-based payments	1.5	0.8
Social security costs	8.7	8.0
Other pension costs	2.7	2.7
	89.2	85.2

The average monthly number of employees, including Directors, during the year was as follows:

	2024	2023
	No.	No.
Production	726	767
Office and administration	437	426
Distribution	904	908
	2 ,067	2,101

Key management personnel compensation and Directors’ remuneration

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities

of the Group, which is considered to be the Directors of the Company.

	2024	2023
	£m	£m
Emoluments	1.3	1.4
Share-based payments	–	0.5
Pension and other post-employment benefit costs	–	0.1
	1.3	2.0

Directors’ remuneration is set out in the Remuneration Report on pages 90 to 111. Mark Kelly retired and was replaced as CEO

by Darren Waters in May 2023. The highest paid Director received remuneration of £476,000 (2023: £412,000).

During the year, retirement benefits were accruing to two Directors in respect of defined contribution pension schemes (2023: three).

The value of contributions paid to a defined contribution pension scheme in respect of the highest paid Director amounted to £21,000

(2023: £15,000).

During the current year, no share options were exercised by Directors of the Group (2023: 316,184 by two Directors). No options

were exercised by the highest paid Director (2023: nil).

During the year no long-term benefits were issued, nor any termination payments made.

The Group’s policy for consulting with, sharing information with, and encouraging the involvement of employees is discussed on

pages 67 to 76.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 143

9 SEGMENTAL INFORMATION

The Group organises itself into a number of operating segments that offer different products and services. They are managed

separately because each business requires different technology and marketing strategies. Internal reporting provided to the chief

operating decision-maker, which has been identified as the executive management team including the Chief Executive and the

Chief Financial Officer, reflects this structure.

The Group has aggregated its operating segments into three reported segments, as these business units have similar products,

production processes, types of customer, methods of distribution, regulatory environments, and economic characteristics:

• Profiles – extrusion and sale of PVC window and building products to the new and replacement window market across the UK.

This segment includes Vista Panels, S&S Plastics and Eurocell Recycle North

• Building Plastics – sale of building plastic materials across the UK

• Corporate – represents costs relating to the ultimate Parent Company and includes the assets and related amortisation in respect

of acquired intangible assets.

Inter-segmental sales, which are eliminated on consolidation, are transacted on an arms’ length basis and relate to manufactured

products distributed by the Building Plastics division.

		Building
	Profiles	Plastics	Corporate	Total
	2024	2024	2024	2024
	£m	£m	£m	£m
Revenue
Total revenue	209.8	212.3	–	42 2.1
Inter-segmental revenue	(63.7)	(0.5)	–	(64.2)
Total revenue from external customers	14 6.1	211.8	–	357.9
Adjusted EBITDA	33.3	15.7	(0.9)	48.1
Amortisation of intangible assets	–	–	(1.3)	(1.3)
Depreciation of property, plant and equipment	(7.5)	(1.3)	(0.8)	(9.6)
Depreciation of right-of-use assets	(6.4)	(7.9)	(0.1)	(14.4)
Adjusted operating profit/(loss)	19.4	6.5	(3.1)	22.8
Non-underlying operating expenses	(4.8)	(1.4)	–	(6.2)
Operating profit/(loss)	14.6	5.1	(3.1)	16.6
Finance expense				(2.8)
Profit before tax				13.8

		Building
	Profiles	Plastics	Corporate	Total
	2023	2023	2023	2023
	£m	£m	£m	£m
Revenue
Total revenue	219.8	210.0	–	429.8
Inter-segmental revenue	(64.9)	(0.4)	–	(65.3)
Total revenue from external customers	154.9	209.6	–	364.5
Adjusted EBITDA	25.5	17. 4	0.2	4 3 .1
Amortisation of intangible assets	–	–	(1.7)	(1.7)
Depreciation of property, plant and equipment	(7. 3 )	(1.2)	(0.8)	(9.3)
Depreciation of right-of-use assets	(6.3)	( 7. 3 )	(0.1)	(13.7)
Adjusted operating profit/(loss)	11.9	8.9	(2.4)	18.4
Non-underlying operating expenses	(1.8)	(0.7)	(1.0)	(3.5)
Operating profit/(loss)	10.1	8.2	(3.4)	14.9
Finance expense				(3.2)
Profit before tax				11.7

Eurocell plc Annual Report and Accounts 2024144

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

9 SEGMENTAL INFORMATION CONTINUED

		Building
	Profiles	Plastics	Corporate	Total
	2024	2024	2024	2024
	£m	£m	£m	£m
Additions to plant, property, equipment and intangible assets	7.1	2.7	0.9	10.7
Segment assets	122.3	84.0	17. 5	223.8
Segment liabilities	(53.2)	(48.9)	(7.2)	(109.3)
Borrowings				(0.5)
Deferred tax liability				(8.6)
Total liabilities				(118.4)
Total net assets				105.4

		Building
	Profiles	Plastics	Corporate	Total
	2023	2023	2023	2023
	£m	£m	£m	£m
Additions to plant, property, equipment and intangible assets	6.9	1.5	0.5	8.9
Segment assets	126.9	78.5	18.4	223.8
Segment liabilities	(53.3)	(43.7)	(4.5)	(101.5)
Borrowings				–
Deferred tax liability				(8.0)
Total liabilities				(109.5)
Total net assets				114.3

Geographical information

		Non-current		Non-current
	Revenue	assets	Revenue	assets
	2024	2024	2023	2023
	£m	£m	£m	£m
United Kingdom	355.8	129.4	362.5	130.8
Republic of Ireland 1	2.1	–	2.0	–
Total	357.9	129.4	364.5	130.8

1 The net book value of non-current assets in the Republic of Ireland was less than £50,000 in both years.

10 FINANCE EXPENSE

	2024	2023
	£m	£m
Finance expense
Bank borrowings	0.7	1.4
Interest on lease liabilities	2.1	1.8
Total finance expense	2.8	3.2

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 145

11 TAXATION

	2024	2023
	£m	£m
Current tax expense
Current tax on profits for the year	3.0	2.0
Adjustments in respect of prior years	(0.3)	(1.1)
Total current tax	2.7	0.9
Deferred tax expense
Origination and reversal of temporary differences	0.4	0.4
Adjustment in respect of prior years	0.2	0.8
Total deferred tax	0.6	1.2
Total tax expense	3.3	2.1

The reasons for the difference between the actual current tax charge for the year and the standard rate of corporation tax in the

United Kingdom applied to profits for the year are as follows:

	2024	2023
	£m	£m
Profit before tax	13.8	11.7
Expected tax charge based on the standard rate of corporation tax in the UK of 25% (2023: 23.5%)	3.4	2.7
Taxation effect of:
Expenses not deductible for tax purposes	0.6	0.4
Patent Box claims	(0.4)	(0.5)
Deferred tax impact of share-based payments	0.4	0.1
Adjustment in respect of prior years	(0.3)	(1.1)
Tax effect of accelerated capital allowances	(1.0)	(0.7)
Current tax expense	2.7	0.9

Eurocell plc Annual Report and Accounts 2024146

11 TAXATION CONTINUED

The reasons for the difference between the total tax charge for the year and the standard rate of corporation tax in the United

Kingdom applied to profits for the year are as follows:

	2024	2023
	£m	£m
Profit before tax	13.8	11.7
Expected tax charge based on the standard rate of corporation tax in the UK of 25% (2023: 23.5%)	3.4	2.7
Taxation effect of:
Expenses not deductible for tax purposes	0.4	0.2
Patent Box claims	(0.4)	(0.5)
Adjustments in respect of prior years	(0.1)	(0.3)
Total tax expense	3.3	2.1

Some expenses incurred, such as certain legal and entertainment costs, are not allowable for tax purposes and are therefore not

deducted from taxable income when calculating the Group’s tax liability.

Capital allowances are tax reliefs for the expenditure the Group makes on fixed assets. The difference between the accounting

treatment of fixed assets for tax and accounting purposes gives rise to temporary difference recognised within deferred tax.

The Group recognises a current tax asset in respect of relief claimed under the Patent Box when the inflow of economic benefits

arising from that asset is virtually certain, deemed to be the submission of a claim to HM Revenue and Customs.

Changes in tax rates and factors affecting the future tax charge

There was no change to the rate of UK corporation tax in the year. The mainstream rate of UK corporation tax increased from 19%

to 25% from April 2023, giving rise to a blended standard rate of 23.5% in 2023.

There are no material uncertain tax provisions.

Tax included in Other Comprehensive Income

The tax charge arising on share-based payments within Other Comprehensive Income is £nil (2023: £nil).

Based on the current investment plans of the Group, and assuming the rates of capital allowances on capital expenditure continue

into the future, the vast majority of the deferred tax liability is expected to unwind over a period of greater than one year.

Tax residency

Eurocell plc and its subsidiaries are all registered in the United Kingdom and are resident in the UK for tax purposes, except as

described below.

The Group has two branches in the Republic of Ireland, with combined annual revenues of £2.1 million (2023: £2.0 million), total assets

of less than £50,000 (2023: less than £50,000) and nine full-time employees (2023: eight full-time employees). For tax purposes,

these two trading locations form a single branch within Eurocell Building Plastics Limited, and therefore any profits generated are subject

to tax in the Republic of Ireland. Profits generated during the year contribute less than 5% of the overall Group profits (2023: less than

5%). The tax charge in relation to the Group’s Republic of Ireland operations in 2024 is €600 (2023: €nil) and tax payments of €600

were made during the year (2023: €nil). The reasons for the difference between the tax charge for the year and the standard rate of

corporation tax in Ireland applied to the profits for the year is due to utilisation of losses brought forward. No deferred tax assets are

recognised on unutilised losses due to the uncertainty of future profits in the Republic of Ireland (2023: none).

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 147

12 EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the net profit for the year attributable to ordinary shareholders by the weighted

average number of ordinary shares outstanding during the year, excluding treasury shares. Adjusted earnings per share excludes

the impact of non-underlying items.

Diluted earnings per share is calculated by adjusting the earnings and number of shares for the effects of dilutive options. In the event

that a loss is recorded for the period, share options are not considered to have a dilutive effect.

During the year, the Company entered into multiple share buyback programmes totalling £15 million. As at 31 December 2024,

the cash outflow in regard to these schemes totalled £14.5 million (including transactional costs), equivalent of 10,287,011 shares.

	2024	2023
	£m	£m
Profit attributable to ordinary shareholders excluding non-underlying items	15.4	12.3
Profit attributable to ordinary shareholders	10.5	9.6

	2024	2023
	No.	No.
Weighted average number of shares – basic	106,455,702	111, 8 8 5,083
Dilutive impact of share options granted	1,339,708	53,451
Weighted average number of shares – diluted	107,795,410	111, 9 3 8, 5 3 4
	2024	2023
	Pence	Pence
Basic earnings per share 9.8 8.6


Adjusted basic earnings per share	14.4	11.0
Diluted earnings per share	9.7	8.6
Adjusted diluted earnings per share	14.3	11.0

13 DIVIDENDS

	2024	2023
	£m	£m
Dividends paid during the year
Interim dividend for 2024 of 2.2p per share (2023: 2.0p per share)	2.3	2.2
Final dividend for 2023 of 3.5p per share (2022: 7.2p per share)	3.8	8.1
	6.1	10.3
Dividends proposed
Final dividend for 2024 of 3.9p per share	4.0	–
Final dividend for 2023 of 3.5p per share	–	3.8
	4.0	3.8

Eurocell plc Annual Report and Accounts 2024 148

14 PROPERTY, PLANT AND EQUIPMENT

					Assets
	Freehold	Leasehold	Plant and	Motor	under
	property	improvements	machinery	vehicles	construction	Total
	£m	£m	£m	£m	£m	£m
Cost
Balance at 1 January 2023	9.0	–	6 9.1	1.1	6.0	85.2
Additions	–	–	1.7	0.3	6.8	8.8
Disposals	–	–	(2.2)	(0.2)	(0.4)	(2.8)
Transfers	–	–	4.5	–	(5.4)	(0.9)
Balance at 31 December 2023	9.0	–	73.1	1.2	7.0	90.3
Additions	–	–	6.4	0.3	3.9	10.6
Disposals	–	–	(1.5)	(0.1)	–	(1.6)
Transfers	1.2	–	2.3	–	(3.5)	–
Balance at 31 December 2024	10.2	–	80.3	1.4	7.4	99.3
Accumulated depreciation and impairment
Balance at 1 January 2023	1.8	–	20.8	0.9	–	23.5
Charge for the year	0.3	–	8.9	0.1	–	9.3
Impairment charges	–	–	0.2	–	–	0.2
Disposals	–	–	(2.2)	(0.2)	–	(2.4)
Transfers	–	–	(0.2)	–	–	(0.2)
Balance at 31 December 2023	2.1	–	27.5	0.8	–	30.4
Charge for the year	0.3	–	9.0	0.3	–	9.6
Disposals	–	–	(1.1)	(0.1)	–	(1.2)
Balance at 31 December 2024	2.4	–	35.4	1.0	–	38.8
Net book value
At 31 December 2024	7. 8	–	44.9	0.4	7.4	60.5
At 31 December 2023	6.9	–	45.6	0.4	7.0	59.9

Included within freehold property is non-depreciable land of £2.3 million (31 December 2023: £2.3 million).

There is no restriction of title, nor equipment pledged as security for liabilities included with property, plant and equipment.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 149

15 RIGHT-OF-USE ASSETS

			Office
	Leasehold	Motor	equipment
	improvements	vehicles	and fixtures	Total
	£m	£m	£m	£m
Cost
Balance at 1 January 2023	68.4	24.4	–	92.8
Additions	4.6	4.7	0.3	9.6
Disposals	(2.7)	(4.1)	–	(6.8)
Balance at 31 December 2023	70.3	25.0	0.3	95.6
Additions	11. 2	5.7	–	16.9
Disposals	(3.9)	(7.2)	–	(11.1)
Balance at 31 December 2024	77.6	23.5	0.3	101.4
Accumulated depreciation and impairment
Balance at 1 January 2023	21.7	11.4	–	3 3 .1
Charge for the year	8.7	4.9	0 .1	13.7
Impairment charges	–	0.1	–	0.1
Disposals	(2.8)	(3.6)	–	(6.4)
Balance at 31 December 2023	27.6	12.8	0.1	40.5
Charge for the year	9.4	5.0	–	14.4
Impairment charges	3.3	–	–	3.3
Disposals	(3.9)	(7.2)	–	(11.1)
Balance at 31 December 2024	36.4	10.6	0.1	47.1
Net book value
At 31 December 2024	41.2	12.9	0.2	54.3
At 31 December 2023	42.7	12.2	0.2	55.1

Impairments charges of £3.3 million (2023: £0.1 million) relates to the impairment of right-of-use properties, of which £3.2 million has

been classified as non-underlying (see Note 7).

See Note 22 for details of lease liabilities.

Eurocell plc Annual Report and Accounts 2024150

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

16 INTANGIBLE ASSETS

		Technology-	Customer-	Marketing-
	Software	based	related	related	Goodwill	Total
	£m	£m	£m	£m	£m	£m
Cost
Balance at 1 January 2023	3.7	1.6	7. 0	6.5	16.6	35.4
Additions	0.1	–	–	–	–	0.1
Transfers	0.7	–	–	–	–	0.7
Disposal	(1.0)	(0.1)	–	(0.2)	–	(1.3)
Balance at 31 December 2023	3.5	1.5	7.0	6.3	16.6	34.9
Additions	0.1	–	–	–	–	0.1
Balance at 31 December 2024	3.6	1.5	7.0	6.3	16.6	35.0
Accumulated amortisation
Balance at 1 January 2023	2.0	0.9	6.1	3.7	5.8	18.5
Charge for the year	0.4	0 .1	0.7	0.5	–	1.7
Disposals	(0.8)	(0 .1)	–	(0.2)	–	(1.1)
Balance at 31 December 2023	1.6	0.9	6.8	4.0	5.8	19.1
Charge for the year	0.5	0.1	0.2	0.5	–	1.3
Balance at 31 December 2024	2.1	1.0	7.0	4.5	5.8	20.4
Net book value
At 31 December 2024	1.5	0.5	–	1.8	10.8	14.6
At 31 December 2023	1.9	0.6	0.2	2.3	10.8	15.8

Included within customer-related and marketing-related intangible assets are the acquired intangibles in relation to the acquisition of

Vista Panels in 2016, which have a combined carrying value of £0.2 million (2023: £0.4 million) and a remaining amortisation period

of one year.

There are no internally-generated intangible assets.

17 IMPAIRMENT

For the purpose of impairment testing, goodwill is allocated to Cash Generating Units (‘CGUs’) as follows:

	2024	2023
	£m	£m
Eurocell Building Plastics	5.1	5 .1
Eurocell Profiles	3.3	3.3
Vista Panels	2.2	2.2
S&S Plastics	0.2	0.2
	10.8	10.8

CGUs are determined with reference to the smallest identifiable groups of assets that generate cash flows independently of other

groups of assets, with reference to the business or product sectors in which they operate and CGUs are smaller than the disclosed

segments. Impairment of goodwill is not considered at an individual branch level (‘Building Plastics: CGU’) as acquired goodwill is not

separately identifiable on that basis.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 151

In January 2023, there was a change to how CGU performance was presented to the chief operating decision-maker which reported

the recycling operations as a separate CGU. At the point this change was made there was no goodwill held in this CGU and an

impairment test was performed and was concluded that no impairment was required.

The recoverable amounts of the CGUs have been determined from ‘value-in-use’ calculations which have been predicated on

discounted pre-tax cash flow projections based on a three-year business plan approved by the Board. These projections are based

on all available information and growth rates do not exceed growth rates achieved in prior periods.

The key assumptions in preparing these forecasts are in line with the Group’s published strategy, which includes continuing to open

new branches, developing new products and increasing the use of recycled materials.

The cash flow forecasts take into consideration the factors in relation to climate change as discussed in the Sustainability Report

section of the Strategic Report on pages 22 to 39. Management has considered the impact of a rise in global temperatures of 2.0

degrees Celsius. In conclusion, the Group believes the impact on cash flows would be broadly neutral, on the basis that any negative

impact of the transition to a low-carbon society would be offset by both the increased recycling of PVC windows and Government

legislation to reduce emissions through the replacement of old windows with newer windows with better thermal qualities (such as

the Future Homes Standard), both long-term drivers of growth for the business. The Group continues to replace and upgrade its

fleet of extruders and vehicles as part of its normal maintenance capex cycle, and therefore does not anticipate any risk of asset

obsolescence or significant additional costs in this scenario.

All of the Group’s CGUs operate principally in the UK Repair, Maintenance and Improvements market, and all are funded through a

combination of retained earnings and the Group’s Revolving Credit Facility. The strategic decision-making timeframe is also consistent

across all CGUs. Consequently, the key assumptions detailed below are applied consistently across each CGU:

	2024	2023
Period on which management-approved forecasts are based (years)	3	3
Discount rate (pre-tax)	14%	12%
Profit growth rate in perpetuity	2%	2%

The period on which management-approved forecasts are based is consistent with the Board’s strategic planning timeframe.

The discount rate reflects an estimate of the Group’s pre-tax Weighted Average Cost of Capital, based on past experience and

sector-weighted assumptions. The profit growth rate in perpetuity is consistent with the average annual growth in UK Gross

Domestic Product between 1990 and 2019 (source: Office for National Statistics).

Goodwill is considered to have an indefinite useful life.

The Group assessed the recoverable amount in respect of goodwill for each CGU to be greater than the carrying amount and

therefore no impairment arises. No reasonably possible change in assumptions would result in an impairment for these CGUs.

Sensitivities

The following sales reduction or discount rate increase sensitivities would reduce headroom on each CGU to nil:

	2024			2023
	Sales	Discount rate	Sales	Discount rate
Eurocell Building Plastics	77%	47%	77%	40%
Eurocell Profiles	71%	41%	74%	37%
Vista Panels	79%	56%	84%	49%
S&S Plastics	24%	14%	31%	16%

Eurocell plc Annual Report and Accounts 2024152

18 INVENTORIES

	2024	2023
	£m	£m
Raw materials	6.8	7. 3
Work in progress	4.4	3.7
Finished goods and goods for resale	36.0	35.7
	47. 2	46.7

All inventories are carried at cost less a provision to take account of slow-moving and obsolete items. At 31 December 2024,

the inventory provision amounted to £3.7 million (2023: £3.5 million).

19 TRADE AND OTHER RECEIVABLES

	2024	2023
	£m	£m
Trade receivables	37.7	38.6
Less: provision for impairment of trade receivables	(1.2)	(1.2)
Less: provision for rebates payable	(1.9)	(2.3)
Net trade receivables	34.6	35 .1
Contract assets	2.3	1.9
Prepayments	8.3	7.9
Other receivables	0.6	0.4
Total trade and other receivables	45.8	45.3

Trade receivables are non-interest-bearing and are generally on 30 days’ credit. The fair values of trade and other receivables

classified as financial assets are not materially different to their carrying values.

Contract assets are amortised over the period in which revenue pertaining to those costs is recognised, which on average is four

years. Additions of £1.2 million were recognised during the year (2023: £1.8 million), and amounts amortised against revenue were

£0.8 million (2023: £0.6 million).

The Group applies the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance

for all financial assets. In measuring expected credit losses for trade receivables, receivables have been grouped based on shared

characteristics and days past due. Insured balances are excluded to the extent that no loss would arise in the event of default by the

customer. Contract assets are assessed for impairment on a customer-by-customer basis following the application of the expected

credit losses to the trade receivables.

Expected loss rates are derived based upon the payment profile of sales over a three-year period before 31 December 2024, and

the corresponding credit losses experienced. These rates are then adjusted to reflect current and forward-looking information on

macroeconomic factors affecting the ability of customers to settle receivables, GDP, the rate of unemployment, new housing starts,

interest rates and household disposable income.

The closing loss allowances for trade receivables and contract assets as at 31 December reconcile to the opening loss allowances

as follows:

	Trade receivables		Contract assets
	2024	2023	2024	2023
	£m	£m	£m	£m
At 1 January	1.2	1.8	–	–
Charged during the year	0.8	0.5	–	–
Released or utilised during the year	(0.7)	(0.4)	–	–
Receivables written off during the year as uncollectible	(0.1)	(0.7)	–	–
At 31 December	1.2	1.2	–	–

Trade receivables and contract assets are written off where there is no reasonable expectation of recovery. Indicators that there is

no reasonable expectation of recovery include, amongst others, the failure of a debtor to engage in a repayment plan with the Group,

and a failure to make contractual payments for a period of greater than 120 days past due.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 153

Impairment losses on trade receivables are presented as net impairment losses within operating profit. Subsequent recoveries

of amounts previously written off are credited against the same line item.

The rate of expected loss continued to decrease as payment patterns returned to normal following the disruption of the global

pandemic and its after-effects. The rate has now returned to historical levels.

		More than 30	More than 60	More than 90	More than 120
	Current	days past due	days past due	days past due	days past due	Total
At 31 December 2024	£m	£m	£m	£m	£m	£m
Expected loss rate	1%	15%	45%	78%	78%	3%
Gross carrying amount
– trade receivables	35.1	1.5	0.2	0.1	0.8	37.7
Gross carrying amount
– contract assets	2.3	–	–	–	–	2.3
Loss allowance	0.1	0.2	0.1	0.1	0.7	1.2

		More than 30	More than 60	More than 90	More than 120
	Current	days past due	days past due	days past due	days past due	Total
At 31 December 2023	£m	£m	£m	£m	£m	£m
Expected loss rate	1%	12%	48%	81%	74%	3%
Gross carrying amount
– trade receivables	35.7	1.6	0.4	0.1	0.8	38.6
Gross carrying amount
– contract assets	1.9	–	–	–	–	1.9
Loss allowance	0.1	0.2	0.2	0 .1	0.6	1.2

20 BORROWINGS

The book value and fair value of borrowings are as follows:

	Book value	Fair value	Book value	Fair value
	2024	2024	2023	2023
	£m	£m	£m	£m
Non-current
Bank borrowings unsecured	0.5	0.5	–	–
Total borrowings	0.5	0.5	–	–

Borrowings of £1.0 million were drawn down at 31 December 2024 (2023: £nil). The average drawdown on the facility during the year

ended 31 December 2024 was £2.3 million (2023: £12.4 million). Total unamortised costs of £0.5 million as at 31 December 2024 are

presented as a deduction to borrowings. Total unamortised costs of £0.7 million as at 31 December 2023 were reclassified to other

receivables and no borrowings were drawn as at that date.

The bank borrowings outstanding at 31 December 2024 are classified as non-current liabilities as they relate to committed facilities

available to the Group until 2027. The book value and fair value are not considered to be materially different.

In May 2023, the Group completed a one-year extension to its £75 million multi-currency revolving unsecured credit facility, which

now matures in 2027. The key terms of the facility remain unchanged. Following the extension of the facility in 2023, £0.2 million of

costs were capitalised within borrowings and are being released to the Consolidated Statement of Comprehensive Income within

finance expense over the period of the facility.

Interest is charged at an excess over base rate of between 1.5% and 2.5% per annum and is dependent upon the ratio of total net

debt to consolidated EBITDA (on a pre-IFRS 16 basis).

All of the Group’s borrowings are denominated in Sterling. Details of the Company’s banking covenants are given in Note 3.

Eurocell plc Annual Report and Accounts 2024154

20 BORROWINGS CONTINUED

The analysis of repayments on the combined borrowings is as follows:

	2024	2023
	£m	£m
Within one year or repayable on demand	–	–
Between one and two years	–	–
Between two and five years	(1.0)	–
	(1.0)	–

21 TRADE AND OTHER PAYABLES

	2024	2023
	£m	£m
Current liabilities
Trade payables	30.8	29.0
Other tax and social security	5.5	6.0
Other payables	0.9	0.8
Accruals and deferred income	8.0	5.8
Total current trade and other payables	45.2	41.6

Book values approximate to fair value at 31 December 2024 and 31 December 2023.

22 LEASE LIABILITIES

	2024	2023
	£m	£m
Lease liabilities
Current	12.5	12.9
Non-current	46.9	45.7
Total discounted lease liabilities at 31 December	59.4	58.6

	2024	2023
	£m	£m
Maturity analysis
— Less than one year	14.2	14.4
— One to five years	36.3	34.2
— More than five years	15.6	15.6
Total undiscounted lease liabilities at 31 December	66.1	64.2

	2024	2023
	£m	£m
Finance expense
Interest on lease liabilities	2.1	1.8

See Note 15 for details of right-of-use assets.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 155

23 PROVISIONS

	Dilapidations and
	environmental	Warranty
	provisions	provisions	Total
	£m	£m	£m
At 1 January 2023	1.2	–	1.2
Charged to Statement of Comprehensive Income	0.1	–	0.1
Utilised	–	–	–
At 31 December 2023	1.3	–	1.3
Charged to Statement of Comprehensive Income	0.4	–	0.4
Utilised	–	–	–
At 31 December 2024	1.7	–	1.7
Current	0.4	–	0.4
Non-current	1.3	–	1.3
At 31 December 2024	1.7	–	1.7

Dilapidations and environmental provisions

Under property lease agreements, the Group has obligations to maintain all properties to the standard prevailed at the inception of

the respective leases. The provision represents the Directors best estimate of the costs associated with this obligation by applying

historical information based on past events to estimate a cost per sq ft for individual properties and applying a risk-free rate to

discount the future cash flows.

The timing of the utilisation of the provision is variable dependent on the lease expiry or predicted future dates of the properties

concerned, which vary between one and ten years. Based on the lease expiry or predicted date, 26% of the provision (2023:

13%) would be utilised in less than one year, however, we predominately remain in existing locations with refurbishments carried

out. Based on our business strategy, we only intend to exit or relocate a minimal number of branches during 2025, therefore,

we anticipate the utilisation of the provision to be c.£0.1 million in the short term.

Warranty provisions

The Group makes provision to cover known potential warranty issues. The current provision is in relation to sales of garden

rooms and extensions, and represents the Directors’ best estimate of the costs associated with this obligation. The provision

at 31 December 2024 is £27,000 (2023: £nil).

The timing of the utilisation is variable depending on the circumstances of each individual claim under warranty.

24 DEFERRED TAX

The movement in the net deferred tax liability is as follows:

	2024	2023
	£m	£m
At 1 January	(8.0)	(6.8)
Charged to Statement of Comprehensive Income	(0.6)	(1.2)
At 31 December	(8.6)	(8.0)

Deferred tax assets have been recognised in respect of all tax losses and other temporary differences giving rise to deferred tax

assets where the Directors believe it is probable that these assets will be recovered. There are no unrecognised deferred tax assets.

The vast majority of the deferred tax liability is expected to unwind over a period of greater than one year.

Eurocell plc Annual Report and Accounts 2024156

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

24 DEFERRED TAX CONTINUED

The movements in deferred tax assets and liabilities (prior to the offsetting of balances within the same jurisdiction as permitted by

IAS 12) during the year, together with amounts recognised in the Consolidated Statement of Comprehensive Income and amounts

recognised in Other Comprehensive Income are as follows:

				Statement of
				Comprehensive
	Asset	Liability	Net	Income	Equity
	2024	2024	2024	2024	2024
	£m	£m	£m	£m	£m
Accelerated capital allowances/intangible fixed assets	–	(9.4)	(9.4)	(0.9)	–
Other temporary differences	0.8	–	0.8	0.3	–
Net tax assets/(liabilities)	0.8	(9.4)	(8.6)	(0.6)	–

				Statement of
				Comprehensive
	Asset	Liability	Net	Income	Equity
	2023	2023	2023	2023	2023
	£m	£m	£m	£m	£m
Accelerated capital allowances/intangible fixed assets	–	(8.5)	(8.5)	(1.1)	–
Other temporary differences	0.5	–	0.5	( 0.1)	–
Net tax assets/(liabilities)	0.5	(8.5)	(8.0)	(1.2)	–

Amounts within Other Comprehensive Income due to be settled in greater than one year are not material and therefore no further

disclosure has been provided. Other temporary differences relate to the tax impact of share-based payment transactions expected

to reverse within one to three years and tax losses deemed to be recoverable in future periods.

Based on the current investment plans of the Group, and assuming the rates of capital allowances on capital expenditure continue

into the future, the vast majority of the deferred tax liability is expected to unwind over a period of greater than one year.

25 SHARE CAPITAL, SHARE PREMIUM ACCOUNT, TREASURY SHARES AND SHARE BUYBACK

				Allotted, called up and fully paid
			2024		2023
			Number		Number
Ordinary shares of £0.001 each	10	3,15	0,173	112,0	9 5,18 4

	2024	2023
	£m	£m
Ordinary shares of £0.001 each	0.1	0.1
Share premium account	22.2	22.2

As at 31 December 2024, there were 176,280,173 shares authorised for issue (2023: 186,825,184). The ordinary shares carry the rights

to attend and vote at general meetings, the right to receive payment in respect of dividends declared and the right to participate in the

distribution of capital. The ordinary shares are not redeemable.

During the year, the Company entered into multiple share buyback programmes totalling £15 million. As at 31 December 2024,

the cash outflow in regard to these schemes totalled £14.5 million (including transactional costs), equivalent of 10,287,011 shares.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 157

Treasury shares

	Number of shares	£m
Balance at 1 January 2023	–	–
Acquisition of shares	(650,000)	(0.7)
Deferred shares issued under the DSP scheme	229,901	0.2
Shares issued under the PSP scheme	367,0 05	0.4
Balance at 31 December 2023	(53,094)	(0.1)
Acquisition of shares	(1,342,000)	(1.9)
Deferred shares issued under the DSP scheme	31,637	–
Shares issued under the PSP scheme	7,671	–
Balance at 31 December 2024	(1,355,786)	(2.0)

Where any group company purchases the Company’s equity instruments, the consideration paid, including any directly attributable

incremental costs (net of income taxes), is deducted from equity as treasury shares until the shares are cancelled or reissued. Where shares

are subsequently reissued, any consideration received, net of any directly attributable incremental transaction costs and the related income

tax effects, is included in equity. Of the 1,355,786 treasury shares at 31 December 2024,13,786 were held by the Employees Benefit Trust.

The Group issued no new shares (2023: no new shares) in respect of its Save As You Earn sharesave scheme, in the process receiving

consideration from employees of £nil (2023: £nil). The consideration received above the nominal value of the shares issued has been

recorded as share premium.

During the year, no new shares (2023: nil) were issued in respect of share-based payment transactions for Directors and none

(2023: none) were issued in respect of share-based payment transactions for other key management personnel.

The 2023 and 2024 shares issued in respect of share-based payment transactions were all issued from treasury shares.

26 SHARE-BASED PAYMENTS

The Group enters into equity-settled payment transactions with its employees. For the year ended 31 December 2024, the charge was

£1.5 million (2023: £0.8 million). A corresponding credit to equity is recognised in the share-based payment reserve. On exercise of

options, balances are removed from the share-based payment reserve with corresponding entries made to share premium, retained

earnings and cash. The balance on the share-based payment reserve at 31 December 2024 was £2.3 million (2023: £0.9 million).

26(a) Employee Save As You Earn Scheme

Each year, all employees have the right to participate in a Save As You Earn (‘SAYE’) scheme. Employees may make monthly

contributions of up to £500, the proceeds being aggregated and then used to purchase ordinary shares at the end of the three-year

vesting period. The cost to the participants is set at the inception of the scheme, with the balance being funded by the Company.

Typically, participants are offered a discount on the share price at the date of issuance.

Set out below are summaries of options granted under the plan:

	2024		2023
	Average		Average
	exercise price per	Number	exercise price			Number
	share option	of options	per share option			of options
	£	No.	£			No.
As at 1 January	1.317	2,598,526	1.758	1,	8 9 0,10	2
Granted during the year	0.924	2,682,692	1.10 3			2,151,517
Exercised during the year	1.103	( 7,671)	–			–
Forfeited during the year	1.334	(1,807,507)	1.576			(1,443,093)
As at 31 December	1.005	3,466,040	1.317			2,598,526
Vested and exercisable at 31 December		–				–

There were 7,671 options exercised during the year ended 31 December 2024 (2023: nil).

Eurocell plc Annual Report and Accounts 2024158

26 SHARE-BASED PAYMENTS CONTINUED

26(a) Employee Save As You Earn Scheme continued

Share options outstanding at the end of the year have the following expiry dates and exercise prices:

		Exercise	31 December	31 December
		price	2024	2023
	Expiry date	£	No.	No.
1 June 2020	1 June 2023	1.720	–	297,220
1 June 2021	1 June 2024	1.832	–	264,704
1 June 2022	1 June 2025	1.720	145,976	292,261
1 June 2023	1 June 2026	1.10 3	910,668	1,744, 341
1 June 2024	1 June 2027	0.924	2,409,396	–
As at 31 December			3,466,040	2,598,526
Weighted average contractual life of options outstanding at end of year			2.07 years	1.82 years

Fair value of options granted

The assessed fair value at grant date of options granted during the year ended 31 December 2024 was £0.40 per option

(2023: £0.21 per option). The fair value at the grant date is determined using a form of the Black–Scholes model.

The model inputs for options granted during the year end 31 December 2024 included:

	2024
Options are granted for the consideration set at the inception of the scheme
Exercise price	0.924
Grant date	19 April 2024
Expiry date	31 May 2027
Share price at grant date	1.35
Expected price volatility of the Company’s shares	20.0%
Expected dividend yield	4.0%
Risk-free interest rate	3.9%

The expected price volatility is based on the historical volatility (based on the remaining life of the options), adjusted for any expected

changes to future volatility due to publicly available information.

26(b) Deferred Share Plan

Annual Bonus Plan outcomes can be paid in a mix of cash and deferred shares granted under the Company’s Deferred Share Plan

(‘DSP’), following the determination of achievement against performance measures and targets. Performance measures applied

may be financial or non-financial and corporate, divisional or individual and in such proportions as the Remuneration Committee

considers appropriate. The maximum level of Annual Bonus Plan outcomes is 100% of base salary per annum for the duration of this

policy. Awards under the DSP are deferred for such a period as the Remuneration Committee selects at grant, which will normally be

less than (but may be longer than) three years and are subject to continued employment. The options vest in full, provided that the

scheme participants are deemed to be good leavers, and are settled through the issuance of treasury shares.

The following table shows the deferred shares granted and outstanding at the beginning and end of the reporting period:

	2024	2023
	No.	No.
As at 1 January	1,243,941	355,765
Granted during the year	–	1,254,655
Exercised during the year	(45,492)	(204,769)
Forfeited during the year	(70,640)	(161,710)
As at 31 December	1,127,8 09	1,243,941
Vested and exercisable at 31 December	–	–

The weighted average share price at the date of exercise of options exercised during the year ended 31 December 2024 was £1.35

(2023: £1.09).

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 159

Share options outstanding at the end of the year have the following expiry dates and exercise prices:

		Exercise	31 December	31 December
		price	2024	2023
	Expiry date	£	No.	No.
30 June 2022	30 June 2025	0.001	73,338	73,338
3 April 2023	3 April 2025	0.001	15,681	15,681
3 April 2023	3 April 2026	0.001	552,440	668,572
11 April 2023	11 April 2025	0.001	410,447	410,447
11 April 2023	11 April 2026	0.001	8,227	8,227
14 September 2023	5 September 2025	0.001	33,838	33,838
14 September 2023	1 January 2026	0.001	33,838	33,838
As at 31 December			1,127,8 09	1,243,941
Weighted average contractual life of options outstanding at end of year			0.8 years	1.84 years

Fair value of options granted

The fair value at the grant date is determined using a form of the Black–Scholes model in line with inputs detailed in the above table.

No DSP options were granted in 2024 (2023: 1,254,655 with 84,052 subsequently lapsing before the end of the year). As no DSP

options were granted in the year, the assessed fair value at grant date of the rights granted during the year ended 31 December 2024

was £nil per option (2023: £1.21 per option).

26(c) Long-Term Incentive Plan (‘PSP’)

Awards under the PSP take the form of nil-cost options which vest to the extent performance conditions are satisfied over a period of

three years. The share award is based on a percentage of salary, a proportion of the maximum will vest based on performance targets

of which Earnings per Share equates to two-thirds of the award and (for options granted before 2021) cash flow one-third of the

award. For options granted in 2021 and thereafter, the cash flow target has been replaced with Return on Capital Employed.

Vested awards are settled through the issuance of treasury shares, and the PSP allows for awards over shares with a maximum value

of 150% of base salary per financial year.

The following table shows the share options granted and outstanding at the beginning and end of the reporting period:

	2024	2023
	No.	No.
As at 1 January	2,262,457	2,509,646
Granted during the year	1,948,389	794,710
Exercised during the year	–	(316,184)
Forfeited during the year	(8 42 ,147)	(725,715)
As at 31 December	3,368,699	2,262,457
Vested and exercisable at 31 December	–	–

Share options outstanding at the end of the year have the following expiry dates and exercise prices:

		Exercise	31 December			31 December
		price	2024			2023
	Expiry date	£	No.			No.
22 April 2021	21 April 2024	0.000	–			610,900
21 October 2021	11 October 2024	0.000	–		7,78	2
13 April 2022	13 April 2025	0.000	621,805			711,476
11 October 2022	11 October 2025	0.000	137,	58 9		137, 5 8 9
11 April 2023	11 April 2026	0.000		794,710		794,710
10 April 2024	10 April 2027	0.000		1,755,258		–
17 October 2024	17 October 2027	0.000		59,337		–
As at 31 December				3,368,699		2,262,457
Weighted average contractual life of options outstanding at end of year				1.62 years		1.4 years

Eurocell plc Annual Report and Accounts 2024160

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

26 SHARE-BASED PAYMENTS CONTINUED

26(c) Long-Term Incentive Plan (‘PSP’) continued

Fair value of options granted

The fair value at the grant date is determined using a form of the Black–Scholes model.

The model inputs for options granted during the year end 31 December 2024 included:

	2024
	Tranche 1	Tranche 2
Options are granted for the consideration set at the inception of the scheme
Exercise price	0.001	0.001
Grant date	10 April 2024	17 October 2024
Expiry date	10 April 2027	17 October 2027
Share price at grant date	1.322	1.740
Expected price volatility of the Company’s shares	20.0%	20.0%
Expected dividend yield	4.0%	4.0%
Risk-free interest rate	3.9%	3.9%

The expected price volatility is based on the historical volatility (based on the remaining life of the options), adjusted for any expected

changes to future volatility due to publicly available information.

The assessed fair value at grant date of the rights granted during the year ended 31 December 2024 were £1.17 and £1.54 per

option, a weighted average of £1.18 (2023: £1.17). The closing share price on the 31 December 2024 was £1.71 (2023: £1.31).

26(d) Expenses arising from share-based payment transactions

The total charge arising from share-based payment transactions recognised during the period as part of employee benefit expense

was as follows:

	2024	2023
	£m	£m
Options issued under SAYE scheme	0.2	0.2
Deferred shares issued under the DSP scheme	0.6	0.3
Shares issued under the PSP scheme	0.7	0.3
	1.5	0.8

27 CONTINGENT ASSETS AND LIABILITIES

The Group has entered into a cross-guarantee arrangement to cover the bank borrowings of all other Group companies in the event

of default. As at 31 December 2024, the bank borrowings were £1.0 million (2023: £nil).

The Group had no other material contingent assets or liabilities (31 December 2023: £nil).

28 CAPITAL COMMITMENTS

The Group had capital commitments relating to property, plant and equipment of £3.3 million at the balance sheet date (2023: £1.9 million).

29 RETIREMENT BENEFITS

The Group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group

in an independently administered fund. The pension cost represents contributions payable by the Group to the fund and amounted

to £2.7 million (2023: £2.7 million). Contributions of £0.5 million were due to the scheme at 31 December 2024 (2023: £0.4 million).

30 RELATED PARTY TRANSACTIONS

The Group’s subsidiary undertakings are detailed in Note 37. The Group has taken advantage of the exemption from disclosing

transactions with wholly-owned subsidiaries.

Transactions with key management personnel

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities

of the Company, which is considered to be the Directors of the Company. The remuneration of key management personnel of the

Group is disclosed on pages 90 to 111.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 161

Other related party transactions

Kellmann Recruitment Limited is controlled by T Kelly, a close family member of M Kelly who was a Director of Eurocell plc until

11 May 2023. The fees paid to Kellmann Recruitment Limited relate to recruitment services, and are agreed on an arms’ length basis,

at rates that are consistent with other similar suppliers of recruitment services to the Group.

The following amounts were paid to Kellmann Recruitment Limited for services provided during the periods below, up to 11 May 2023:

	2024	2023
	£000	£000
Kellmann Recruitment Limited – recruitment services	–	103

There were no outstanding balances as at 31 December 2023 or 2024.

31 RECONCILIATION OF PROFIT AFTER TAX TO CASH GENERATED FROM OPERATIONS

	2024	2023
	£m	£m
Profit after tax 1	10.5	9.6
Taxation (Note 11)	3.3	2.1
Finance expense (Note 10)	2.8	3.2
Operating profit	16.6	14.9
Adjustments for:
Depreciation of property, plant and equipment (Note 14)	9.6	9.3
Depreciation of right-of-use assets (Note 15)	14.4	13.7
Amortisation of intangible assets (Note 16)	1.3	1.7
Impairment of tangible and right-of-use assets	3.2	0.3
Loss on disposal of property, plant and equipment	0.4	–
Share-based payments	1.5	0.8
(Increase)/decrease in inventories	(0.5)	13.2
(Increase)/decrease in trade and other receivables	(3.4)	6.0
Increase/(decrease) in trade and other payables	3.7	(5.8)
Increase in provisions	0.4	0.1
Cash generated from operations	47. 2	54.2

1 Profit after tax for 2023 includes other income in relation to amounts received under the Group’s cyber insurance policy, net of excess paid of £0.4 million, in respect

of the business interruption to the Group’s continuing trading activities as a result of a cyber incident in July and August 2022.

Eurocell plc Annual Report and Accounts 2024162

32 RECONCILIATION OF NET DEBT

	1 January			Non-cash	31 December
	2024	Cash flows	New leases	movements 1	2024
	£m	£m	£m	£m	£m
Cash and cash equivalents	0.4	–	–	–	0.4
Bank overdrafts	–	(3.0)	–	–	(3.0)
Lease liabilities	(58.6)	16.5	(16.9)	(0.4)	(59.4)
Borrowings	–	(1.0)	–	0.5	(0.5)
Total	(58.2)	12.5	(16.9)	0.1	(62.5)

	1 January			Non-cash	31 December
	2023	Cash flows	New leases	movements 1	2023
	£m	£m	£m	£m	£m
Cash and cash equivalents	5.1	(4.7)	–	–	0.4
Deferred consideration	0.8	(0.8)	–	–	–
Lease liabilities	(63.7)	15.6	(9.6)	(0.9)	(58.6)
Borrowings	(20.3)	21.0	–	(0.7)	–
Total	( 78.1)	31.1	(9.6)	(1.6)	(58.2)

1 Non-cash movements relate to the amortisation of arrangement fees in respect of the Group’s borrowings and finance charges accrued on leases.

	Current	Current	Non-current
	assets	liabilities	liabilities	Total
31 December 2024	£m	£m	£m	£m
Cash and cash equivalents	0.4	–	–	0.4
Bank overdrafts	–	(3.0)	–	(3.0)
Lease liabilities	–	(12.5)	(46.9)	(59.4)
Borrowings	–	–	(0.5)	(0.5)
Total	0.4	(15.5)	(47.4)	(62.5)

	Current	Current	Non-current
	assets	liabilities	liabilities	Total
31 December 2023	£m	£m	£m	£m
Cash and cash equivalents	0.4	–	–	0.4
Lease liabilities	–	(12.9)	(45.7)	(58.6)
Total	0.4	(12.9)	(45.7)	(58.2)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 163

33 EVENTS AFTER THE BALANCE SHEET DATE

In March 2025 the Group completed the acquisition of Alunet for consideration of £29 million on a debt/cash-free basis, comprising

an initial payment of £22 million and deferred consideration of approximately £7 million payable in four annual instalments beginning

in 2026.

Additional contingent consideration of up to £6m may become payable, subject to an earnout mechanism, in four annual instalments

beginning in 2026, based upon the EBITDA of Alunet in the preceding calendar year. The maximum of £6 million, if achieved, would

result in a total consideration of £35 million.

Approximately £1 million of the initial consideration is in the form of ordinary shares in Eurocell plc and satisfied out of shares held

in treasury, with the remainder payable in cash, funded from the Group’s existing £75 million revolving credit facility.

Also, on 19 March 2025, the Group approved a further share buyback programme of up to £5 million, to begin immediately.

Eurocell plc Annual Report and Accounts 2024164

COMPANY STATEMENT OF FINANCIAL POSITION

As at 31 December 2024

Note

2024

£m

2023

£m

Assets

Non-current assets

Investments 37 2 0.1 18.0

Total non-current assets 20.1 18.0

Current assets

Trade and other receivables 38 44.0 30.1

Deferred tax 39 0.6 0.2

Cash and cash equivalents – 0 .1

Total current assets 44.6 30.4

Total assets 64.7 48.4

Liabilities

Current liabilities

Trade and other payables 40 (0.4) ( 0.1)

Total current liabilities (0.4) ( 0.1)

Non-current liabilities

Borrowings 41 (0.5) –

Total non-current liabilities (0.5) –

Total liabilities (0.9) ( 0.1)

Net assets 63.8 48.3

Issued capital and reserves attributable to owners of the Company

Share capital 25 0.1 0.1

Share premium account 22.2 22.2

Treasury shares 25 (2.0) (0.1)

Share-based payment reserve 2.3 1.1

Share buyback reserve – –

Retained earnings 41.2 25.0

Total equity 63.8 48.3

A separate Statement of Comprehensive Income for the Company is not presented, in accordance with Section 408 of the

Companies Act 2006. The Company recognised a profit of £34.3 million in the year (2023: profit of £3.7 million), including dividend

income received from Group companies of £34.0 million (2023: £5.3 million).

The Financial Statements on pages 164 to 172 were approved and authorised for issue by the Board of Directors on 19 March 2025

and were signed on its behalf by:

Darren Waters Michael Scott

Chief Executive Chief Financial Officer

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 165

COMPANY STATEMENT OF CHANGES IN EQUITY

For the year ended 31 December 2024

capital

£m

premium

account

£m

Treasury

£m

Share-based

payment

reserve

£m

buyback

reserve

£m

Retained

earnings

£m

Total

equity

£m

Balance at 1 January 2024 0.1 22.2 (0.1) 1.1 – 25.0 48.3

Comprehensive income for the year

Profit for the year – – – – – 34.3 34.3

Total comprehensive income

for the year – – – – – 34.3 34.3

Contributions by and

distributions to owners

Exercise of share options – – – (0.1) – (0.2) (0.3)

Share-based payments – – – 1.3 – 0.8 2 .1

Purchase of own shares – – (1.9) – (12.4) (0.2) (14.5)

Cancellation of shares – – – – 12.4 (12.4) –

Dividends paid – – – – – (6.1) (6.1)

Total transactions with owners

recognised directly in equity – – (1.9) 1.2 – (18.1) (18.8)

Balance at 31 December 2024 0.1 22.2 (2.0) 2.3 – 41.2 63.8

capital

£m

premium

account

£m

Treasury

£m

Share-based

payment

reserve

£m

buyback

reserve

£m

Retained

earnings

£m

Total

equity

£m

Balance at 1 January 2023 0.1 22.2 – 0.9 – 31.4 54.6

Comprehensive income for the year

Profit for the year – – – – – 3.7 3.7

Total comprehensive income

for the year – – – – – 3.7 3.7

Contributions by and

distributions to owners

Exercise of share options – – 0.6 (0.8) – 0.2 –

Share-based payments – – – 1.0 – – 1.0

Purchase of own shares – – (0.7) – – – (0.7)

Dividends paid – – – – – (10.3) (10.3)

Total transactions with owners

recognised directly in equity – – ( 0.1) 0.2 – (10.1) (10.0)

Balance at 31 December 2023 0 .1 22.2 ( 0.1) 1.1 – 25.0 48.3

Eurocell plc Annual Report and Accounts 2024166

NOTES TO THE COMPANY FINANCIAL STATEMENTS

For the year ended 31 December 2024

34 ACCOUNTING POLICIES (COMPANY)

Corporate information

Eurocell plc (the ‘Company’) is a publicly listed company limited by shares and is incorporated and domiciled in England, United

Kingdom. The registered office is located in England, at the following address: Eurocell Head Office and Distribution Centre,

High View Road, South Normanton, Alfreton, Derbyshire, DE55 2DT.

The Company is principally engaged as a holding company for its subsidiaries which are engaged in the extrusion of PVC window

and building products to the new and replacement window market and the sale of building materials across the UK.

Basis of preparation

The principal accounting policies adopted in the preparation of the Financial Statements are set out below. The policies have been

consistently applied to all the years presented, unless otherwise stated.

The Company has adequate resources to continue in operational existence for the foreseeable future and, as a result of this,

the going concern basis has been adopted in preparing the Financial Statements (see below).

These Financial Statements have been prepared in accordance with Financial Reporting Standard 101, Reduced Disclosure

Framework in conformity with the requirements of the Companies Act 2006 (‘FRS 101’) and the applicable legal requirements

of the Companies Act 2006.

These Financial Statements have been prepared under the historical cost convention in accordance with FRS 101 and the

Companies Act 2006.

Going concern

The position of the Company mirrors that of the Eurocell Group. The Eurocell Group funds its activities through a £75 million Revolving

Credit Facility, provided by Barclays, NatWest and Bank of Ireland, which matures in May 2027. The facility includes two key financial

covenants, which are tested at 30 June and 31 December each year on a pre-IFRS 16 basis. These are that net debt should not

exceed three times adjusted EBITDA (Leverage), and that adjusted EBITDA should be at least four times the interest charge on the

debt (Interest Cover). Adjusted EBITDA is defined as operating profit before depreciation, amortisation and non-underlying items.

See alternative performance measures (see page 136).

No covenants were breached during the year ended 31 December 2024. For the next measurement period, being 30 June 2025,

and going forward, the Group expects to comply with its covenants.

In assessing going concern, the Directors have considered financial projections for the period to December 2026, which is consistent

with the Board’s strategic planning horizons. These forecasts have been compiled based on the best estimates of the Group’s

commercial and operational teams. This includes a severe but plausible ’Downside’ scenario, which reflects demand for the Group’s

products being severely weakened.

In all scenarios tested, including sensitivities reducing sales forecasts to 10% below management’s estimates for the period 2025–26,

key raw material prices increasing by 33% over that period and both scenarios combined. The Group operates with significant headroom

on its RCF facility and remains compliant with its original covenants.

After reviewing the Group’s projected financial performance and financing arrangements, the Directors consider that the Group

has adequate resources to continue operating and that it is therefore appropriate to continue to adopt the going concern basis

in preparing these Financial Statements.

The going concern assessment performed is intrinsically linked to the Group’s financing arrangements and therefore letters of support

have been provided from Eurocell plc to a number of Group companies, providing support over that individual Company’s future cash

flows in the period. This letter covers the period up to 31 December 2026.

Changes in accounting policies and disclosures applicable to the Company

The Company adopted no new accounting standards in the year. See Note 1 for more details.

Investments in subsidiary undertakings

Investments in subsidiaries are stated at cost less provision for impairment. Eurocell plc provides letters of Group support to its

subsidiary entities where required.

Financial assets

The Company’s financial assets comprise trade and other receivables and cash and cash equivalents in the balance sheet. The Company

records all of its financial assets at amortised cost and has not classified any of its financial assets as fair value through profit and loss

or other comprehensive income.

Financial assets are non-derivative assets with fixed or determinable payments that are not quoted in an active market. They arise

principally through the provision of funding to Group companies, but also incorporate other types of contractual monetary asset.

They are initially recognised at fair value plus transaction costs that are directly attributable to their acquisition or issue and are

subsequently carried at amortised cost using the effective interest rate method, less provision for impairment.

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 167

The Company applies the simplified approach to measuring expected credit losses, if the risk is deemed material, which uses

a lifetime expected loss allowance for intra-group receivables.

Expected loss rates are derived based upon the payment profile of Group companies over a three-year period up to the reporting

date, and the corresponding credit losses experienced. These rates are then adjusted to reflect current and forward-looking

information on macroeconomic factors affecting the ability of Group companies to settle receivables, including GDP, the rate of

unemployment, new housing starts, interest rates and household disposable income. Where the adjusted loss rates are different from

the original estimate, there is an impact on the carrying value of amounts owed by Group undertakings and the amount credited or

charged on a net basis to operating expenses within the Statement of Comprehensive Income.

While cash and cash equivalents are also subject to the impairment requirements of IFRS 9, the identified impairment loss was immaterial.

Financial liabilities

The Company classifies its financial liabilities as other financial liabilities which include the following items:

• Bank borrowings which are initially recognised at fair value net of any transaction costs directly attributable to the issue of the

instrument. Such interest-bearing liabilities are subsequently measured at amortised cost using the effective interest rate method,

which ensures that any interest expense over the period to repayment is at a constant rate on the balance of the liability carried

in the balance sheet. Further information is provided in Note 3

• Trade payables and other short-term monetary liabilities, which are initially recognised at fair value and subsequently carried

at amortised cost using the effective interest method.

Deferred taxation

Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the balance sheet differs from

its tax base, except for differences arising on:

• the initial recognition of goodwill;

• the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction

affects neither accounting nor taxable profit; and

• investments in subsidiaries and jointly controlled entities where the Company is able to control the timing of the reversal of the

difference and it is probable that the difference will not reverse in the foreseeable future.

Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be available against

which the difference can be utilised.

The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted by the reporting

date and are expected to apply when the deferred tax liabilities/(assets) are settled/(recovered).

Deferred tax assets and liabilities are offset when the Company has a legally enforceable right to offset current tax assets and liabilities

and the deferred tax assets and liabilities relate to taxes levied by the same tax authority on either:

• the same taxable Group company; or

• different Group entities which intend either to settle current tax assets and liabilities on a net basis, or to realise the assets and

settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax assets or liabilities are expected

to be settled or recovered.

Share capital

The Company’s ordinary shares are classified as equity instruments.

Treasury shares

Treasury shares are held by the Company and Company’s Employee Benefit Trust for the purpose of satisfying awards under the

Group’s various share-based payment schemes.

The Employee Benefit Trust transactions are incorporated in accordance with Note 1. Shares are acquired from the market and are

held in treasury until such time as they are issued to share scheme participants. Any shares not yet issued to employees at the end

of the reporting period are shown as treasury shares in the Financial Statements. Shares issued to employees are recognised on a

first-in first-out basis. Under the terms of the trust deed, the Group is required to provide the Trust with the necessary funding for the

acquisition of the shares.

Dividends

Dividends are recognised when they become legally payable. In the case of interim dividends to equity shareholders, this is when

paid. In the case of final dividends, this is when approved by the shareholders at the Annual General Meeting.

Further information regarding dividends is provided in Note 13.

Eurocell plc Annual Report and Accounts 2024168

34 ACCOUNTING POLICIES (COMPANY) CONTINUED

FRS 101 exemptions

The following exemptions from the requirements of IFRS have been applied in the preparation of the Company Financial Statements,

in accordance with FRS 101:

Paragraphs 45(b) and 46 to 52 of IFRS 2, Share-based Payment (details of the number and weighted-average exercise prices of

share options, and how the fair value of goods or services received was determined).

• Paragraph 38 of IAS 1, Presentation of Financial Statements, comparative information requirements in respect of paragraph 79(a)

(iv) of IAS 1;

• paragraph 73(e) of IAS 16 Property, Plant and Equipment; and

• paragraph 118(e) of IAS 38 Intangible Assets (reconciliations between the carrying amount at the beginning and end of the period).

The following paragraphs of IAS 1, Presentation of Financial Statements:

• 10(d), (statement of cash flows);

• 10(f) (a statement of financial position as at the beginning of the preceding period when an entity applies an accounting policy

retrospectively or makes a retrospective restatement of items in its Financial Statements, or when it reclassifies items in its Financial

Statements);

• 16 (statement of compliance with all IFRS);

• 38A (requirement for minimum of two primary statements, including cash flow statements);

• 38B-D (additional comparative information);

• 40A-D (requirements for a third statement of financial position);

• 111 (cash flow statement information); and

• 134-136 (capital management disclosures).

Paragraph 30 and 31 of IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors (requirement for the disclosure

of information when an entity has not applied a new IFRS that has been issued but is not yet effective).

Paragraph 17 and 18A of IAS 24, Related Party Disclosures (key management compensation).

The requirements in IFRS 7 Financial Instruments: Disclosures.

The requirements in IAS 24, Related Party Disclosures to disclose related party transactions entered into between two or more

members of a group.

35 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

The Company makes certain estimates and judgements regarding the future. Estimates and judgements are continually evaluated

based on historical experience and other factors, including expectations of future events, that are believed to be reasonable under

the circumstances. In the future, actual experience may differ from these estimates and judgements. There are no estimates and

judgements that are considered to have a significant risk of causing material adjustment to the carrying amounts of assets and

liabilities within the next financial year.

NOTES TO THE COMPANY FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 169

36 EMPLOYEE BENEFITS EXPENSE

2024

£m

2023

£m

Staff costs (including Directors) comprise:

Wages and salaries 0.4 0.4

Social security costs 0.1 0.1

0.5 0.5

The average number of monthly employees was six (2023: six), all of whom are Directors of the Company.

Key management personnel compensation and Directors’ remuneration

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities

of the Company, which is considered to be the Directors of the Company.

2024

£m

2023

£m

Emoluments 1.3 1.4

Share-based payments – 0.5

Pension and other post-employment benefit costs – 0.1

1.3 2.0

The emoluments are paid by Eurocell Group Limited. Directors’ remuneration is set out in the Remuneration Report on pages 90 to 111.

Mark Kelly retired and was replaced as Chief Executive by Darren Waters in May 2023.

The highest paid Director received remuneration of £476,000 (2023: £412,000).

During the year, retirement benefits were accruing to two Directors in respect of defined contribution pension schemes (2023: three).

The value of contributions paid to a defined contribution pension scheme in respect of the highest paid Director amounted to £21,000

(2023: £15,000).

During the current year, no share options were exercised by Directors of the Company (2023: 316,184 by two Directors). No options

were exercised by the highest paid Director (2023: nil). No other shares were issued to Directors of the Company in either period.

Eurocell plc Annual Report and Accounts 2024170

37 INVESTMENTS

Cost

Investments

insubsidiary

undertakings

£m

Capital

contribution

to subsidiary

companies

£m

Total

£m

At 31 December 2023 17. 8 0.2 18.0

Addition – 2.1 2.1

At 31 December 2024 17. 8 2.3 20.1

Capital contribution to subsidiary companies reflects the fair value movement of share-based payments issued by the Company

to employees who have provided services to subsidiary undertakings.

The subsidiaries of Eurocell plc, all of which have been incorporated in the United Kingdom, are included in these Consolidated

Financial Statements, as follows:

Holding (and voting rights)

Name Principal activity 2024 2023

Eurocell Holdings Limited* Holding company 100% 100%

Eurocell Group Limited Holding company 100% 100%

Eurocell Building Plastics Limited Sale of building plastic materials 100% 100%

Eurocell Profiles Limited Manufacture and sale of building plastic materials 100% 100%

Vista Panels Limited Manufacture and sale of doors 100% 100%

Ecoplas Limited** Recycler of PVC windows 100% 95%

Security Hardware Limited*** Dissolved – 100%

Kent Building Plastics Limited Dormant 100% 100%

Trimseal Limited Dormant 100% 100%

S&S Plastics Limited Dormant 100% 100%

Fairbrook Group Limited Dormant 100% 100%

Fairbrook Limited Dormant 100% 100%

Fairbrook Holdings Limited Dormant 100% 100%

Eurocell Window Systems Limited Dormant 100% 100%

Eurocell Plastics Limited Dormant 100% 100%

Cavalok Building Products Limited Dormant 100% 100%

Merritt Plastics Limited Dormant 100% 100%

Merritt Engineering Limited Dormant 100% 100%

Deeplas Limited Dormant 100% 100%

Deeplas Building Plastics Limited Dormant 100% 100%

Ampco 113 Limited Dormant 100% 100%

* Directly held by Eurocell plc.

** On 22 April 2024, the Ecoplas Earnout on acquisition was settled resulting in the purchase of the remaining 5% shareholding for the consideration of £15,000.

*** The trade and assets of Security Hardware Limited were sold on 2 December 2022 and the company dissolved on 22 October 2024.

All of the above have a registered address of Eurocell Head Office and Distribution Centre, High View Road, South Normanton,

Alfreton, Derbyshire, DE55 2DT.

The Company assesses that the recoverable amounts of these investments are supportable. Recoverable amounts have been

determined from ‘value-in-use’ calculations which have been predicated on discounted pre-tax cash flow projections based on a

three-year business plan approved by the Board. These projections are based on all available information and growth rates do not

exceed growth rates achieved in prior periods.

All of the Company’s CGUs operate principally in the UK Repair, Maintenance and Improvements market, and all are funded through a

combination of retained earnings and the Group’s Revolving Credit Facility. The strategic decision-making timeframe is also consistent

across all CGUs. Consequently, the key assumptions detailed below are applied consistently across the Group’s entities:

2024 2023

Period on which management-approved forecasts are based (years) 3 3

Discount rate (pre-tax) 14% 12%

Profit growth rate in perpetuity 2% 2%

NOTES TO THE COMPANY FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

Strategic Report Corporate Governance Financial Statements

Eurocell plc Annual Report and Accounts 2024 171

38 TRADE AND OTHER RECEIVABLES

2024

£m

2023

£m

Prepayments and other debtors 0.3 0.9

Amounts owed by Group undertakings 43.7 29.2

Total trade and other receivables 44.0 3 0.1

Amounts owed by Group undertakings attract interest of 6.57% (2023: 6.08%) and are repayable on demand. The Company applies

the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance for all financial assets.

In measuring expected credit losses, receivables have been grouped based on shared characteristics and days past due.

The Directors have assessed the risk of impairment of its amounts owed by Group undertakings as at 31 December 2024. After

considering the projected future cash flows expected to arise in its subsidiary entities, the Directors believe that any provision over the

amounts owed by Group undertakings are trivial.

39 DEFERRED TAX

2024

£m

2023

£m

At 1 January 0.2 0.3

Credit/(charged) to the Statement of Comprehensive Income 0.4 (0.1)

At 31 December 0.6 0.2

Deferred tax assets have been recognised in respect of all tax losses and other temporary differences giving rise to deferred tax

assets where the Directors believe it is probable that these assets will be recovered. There are no unrecognised deferred tax assets.

The vast majority of the deferred tax liability is expected to unwind over a period of greater than one year.

The movements in deferred tax assets and liabilities (prior to the offsetting of balances within the same jurisdiction as permitted by IAS

12) during the year, together with amounts recognised in the Statement of Comprehensive Income and amounts recognised in Other

Comprehensive Income are as follows:

Asset

2024

£m

Liability

2024

£m

Net

2024

£m

Statement of

Comprehensive

Income

2024

£m

Equity

2024

£m

Other temporary differences 0.6 – 0.6 0.4 –

Net tax assets 0.6 – 0.6 0.4 –

Asset

2023

£m

Liability

2023

£m

Net

2023

£m

Statement of

Comprehensive

Income

2023

£m

Equity

2023

£m

Other temporary differences 0.2 – 0.2 ( 0.1) –

Net tax assets 0.2 – 0.2 (0.1) –

Amounts within Other Comprehensive Income due to be settled in greater than one year are not material and therefore no further

disclosure has been provided. Other temporary differences relate to the tax impact of share-based payment transactions expected

to reverse within one to three years and tax losses deemed to be recoverable in future periods.

40 TRADE AND OTHER PAYABLES

2024

£m

2023

£m

Trade and other payables 0.4 0.1

Total current liabilities 0.4 0.1

Book values approximate to fair value at 31 December 2024 and 31 December 2023. Trade payables are non-interest-bearing and

are generally settled on 30-60 day terms.

Eurocell plc Annual Report and Accounts 2024172

41 BORROWINGS

The book value and fair value of borrowings are as follows:

Book value

2024

£m

Fair value

2024

£m

Book value

2023

£m

Fair value

2023

£m

Non-current

Bank borrowings unsecured 0.5 0.5 – –

Total borrowings 0.5 0.5 – –

Borrowings of £1.0 million were drawn down at 31 December 2024 (2023: £nil). The average drawdown on the facility during the year

ended 31 December 2024 was £2.3 million (2023: £12.4 million). Total unamortised costs of £0.5 million as at 31 December 2024

are presented as a deduction to borrowings. Total unamortised costs of £0.7 million as at 31 December 2023 are presented as a

deduction to borrowings as no borrowings were drawn as at that date.

The bank borrowings outstanding at 31 December 2024 are classified as non-current liabilities as they relate to committed facilities

available to the Group until 2027. The book value and fair value are not considered to be materially different.

In May 2023, the Group completed a one-year extension to its £75 million multi-currency revolving unsecured credit facility, which

now matures in 2027. The key terms of the facility remain unchanged. Following the extension of the facility in 2023, £0.2 million of

costs were capitalised within borrowings and are being released to the Consolidated Statement of Comprehensive Income within

finance expense over the period of the facility.

Interest is charged at an excess over base rate of between 1.5% and 2.5% per annum and is dependent upon the ratio of total net

debt to consolidated EBITDA (on a pre-IFRS 16 basis).

All borrowings are denominated in Sterling.

Details of the Company’s banking covenants are given in Note 3.

42 RELATED PARTY TRANSACTIONS

Transactions with key management personnel

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities

of the Group, which is considered to be the Directors of the Company and the Directors of the Group’s subsidiary companies.

The remuneration for key management personnel is disclosed on pages 90 to 111. The Group has taken advantage of the exemption

from disclosing transactions with wholly-owned subsidiaries.

Other related party transactions

Kellmann Recruitment Limited is controlled by T Kelly, a close family member of M Kelly who was a Director of Eurocell plc until

11 May 2023. The fees paid to Kellmann Recruitment Limited relate to recruitment services, and are agreed on an arms’ length basis,

at rates that are consistent with other similar suppliers of recruitment services to the Group.

The following amounts were paid to Kellmann Recruitment Limited for services provided during the periods below, up to 11 May 2023:

2024

£m

2023

£m

Kellmann Recruitment Limited – recruitment services – 103

There were no outstanding balances as at 31 December 2023 or 2024.

NOTES TO THE COMPANY FINANCIAL STATEMENTS CONTINUED

For the year ended 31 December 2024

173Eurocell plc Annual Report and Accounts 2024

Financial StatementsCorporate GovernanceStrategic Report

COMPANY INFORMATION

For the year ended 31 December 2024

Directors Derek Mapp

Frank Nelson (resigned 16 May 2024)

Alison Littley

Kate Allum (resigned 31 July 2024)

Will Truman

Iraj Amiri

Darren Waters

Michael Scott

Angela Rushforth (appointed 1 February 2024)

Registered Number 08654028

Registered Office Eurocell Head Office and Distribution Centre

High View Road

South Normanton

Alfreton

Derbyshire

DE55 2DT

Independent Auditors PricewaterhouseCoopers LLP

Chartered Accountants and Statutory Auditors

One Chamberlain Square

Birmingham

B3 3AX

Bankers Barclays Bank plc

1 Churchill Place

London

E14 5HP

National Westminster Bank plc

2 St Phillips Place

Birmingham

B3 2RB

Bank of Ireland

26 Cross Street

Manchester

M2 7AF

For more investor information

visit eurocell.co.uk/investors

Eurocell Head Office and Distribution Centre

High View Road

South Normanton

Alfreton

Derbyshire

DE55 2DT

Printed by a CarbonNeutral

Company certified to ISO 14001 environmental management system.

Printed on material from well-managed, FSC

certified forests and other controlled sources.

100% of the inks used are HP Indigo ElectroInk which complies with RoHS legislation and meets

the chemical requirements of the Nordic Ecolabel (Nordic Swan) for printing companies, 95% of

press chemicals are recycled for further use and, on average 99% of any waste associated with this

production will be recycled and the remaining 1% used to generate energy.

The paper is Carbon Balanced with World Land Trust, an international conservation charity, who

offset carbon emissions through the purchase and preservation of high conservation value land.

Through protecting standing forests, under threat of clearance, carbon is locked-in, that would

otherwise be released.

CBP00019082504183028

Eurocell plc

High View Road

Alfreton

Derbyshire

DE55 2DT

eurocell.co.uk