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RS Group plc
Annual Report and
Accounts 2025
POSITIONING FOR
ACCELERATED
DELIVERY
STRATEGIC
PROGRESS
Strategic report
Performance highlights 1
RS Group at a glance 2
Investment proposition 3
Chairman’s introduction 4
Our culture and values 5
Chief Executive Officer’s (CEO) introduction 7
Our business model 11
Our stakeholders 12
Our marketplace 14
Our strategy 16
Our people plan 17
Our strategy in action 18
Accelerating growth through acquisition 23
Key performance indicators 24
Financial review 28
Regional review 33
Risks, viability and going concern 36
Environmental, social and governance (ESG) 45
Task Force on Climate-related Financial 68
Disclosures (TCFD)
Independent limited assurance report 74
Non-financial and sustainability 76
information statement
Section 172 statement 77
Governance report
Chairman’s letter 79
Board of Directors 80
Governance at a glance 82
Our governanceframework 83
Board activities during the year 86
Board evaluation 89
Board appointments, time commitments
and development
91
Compliance with the UK Corporate 92
Governance Code
Nomination Committee report 93
Audit Committee report 97
Directors’ Remuneration report 104
Directors’ report 132
Statement of Directors’ responsibilities 135
Financial statements
Independent Auditors’ report 137
Group accounts 146
Company accounts 196
Five year record 201
Other information
Shareholder information 202
Glossary of terms 204
By prioritising what makes us different, we are positioning
ourselves for future opportunities. We are building
momentum, resilience and strength for our customers
and suppliers. Our actions today empower tomorrow’s
industrial evolution, unlocking future value for RS Group,
for our stakeholders and for a better world.
POSITIONING FOR
ACCELERATED
DELIVERY
STRATEGIC
PROGRESS
As a high-service global product and
service solutions provider for industrial
customers, our foresight and execution
keep us ahead in a rapidly evolving
world. In challenging markets, we adopt
a long-term perspective, implementing
our strategic plan and investing in
sustainable growth.
ESG RATINGS
AND STANDARDS
Climate leadership
score: A
Medal rating:
Platinum
Global top 50
ESG companies
2024 rating: AA
S&P: included in
Sustainability Yearbook
Performance highlights
ESG GLOBAL GOALS
+ Read more on pages 45 to 73
ADVANCING
SUSTAINABILITY
64%
Reduction in Scope 1 and 2
emissions since 2019/20
2
2023/24: 57%
EMPOWERING
OUR PEOPLE
72
employee engagement
score
2023/24: 75
CHAMPIONING
YOUTH &
COMMUNITIES
913k
young engineers and
students reached through
educational technologies,
learning content and skills
development opportunities
since 2020/21
2023/24: 796k
DOING BUSINESS
RESPONSIBLY
55%
of suppliers by spend have
an EcoVadis rating to drive
ESG performance
2023/24: 52%
FINANCIAL
+ Read more on page 28
Revenue
£2,904m
Change: (1)%
Profit before tax
£206m
Change
3
: (15)%
Adjusted
1
operating profit margin
9.4%
Change
3
: (1.0) pts
Earnings per share
32.5p
Change
3
: (14)%
Dividend per share
22.4p
Change: +2%
Like-for-like
1
revenue change
(2)%
Change: +6 pts
Adjusted
1
profit before tax
£248m
Like-for-like change
3
: (7)%
Adjusted
1
free cash flow
£214m
Change
3
: +42%
Adjusted
1
earnings per share
39.1p
Like-for-like change
3
: (6)%
Return on capital employed
1
15.2%
Change
3
: (1.9) pts
1. An alternative performance measure (APM). Definitions of APMs together with the rationale for presenting such measures and how these
measures have been calculated can be found in Note 3 on pages 154 to 158.
2. Scope 1 and 2 emissions from recent acquisitions included in prior year data back to 2019/20 baseline and updated to reflect
improvements to our reporting methodologies, with more detail provided in our ESG basis of reporting: rsgroup.com/sustainability.
3. Prior year figures have been restated, affecting the year-on-year change. See Note 32 for further details.
Operating profit margin
8.0%
Change
3
: (1.3) pts
Net cash generated from operations
£349m
Change
3
: +16%
RS Group plc Annual Report and Accounts 2025 1GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
At a glance
OUR PURPOSE
Why we exist
Making amazing
happen for a
better world
+ Read more on pages 45 to 73
OUR VISION
Where we are going
To be first
choice for all our
stakeholders
+ Read more on pages 12 and 13
OUR VALUES
How we do business
+ Read more on pages 5 and 6
CONNECTING CUSTOMERS AND SUPPLIERS
We are a high-service global product and
service solutions provider for industrial
customers, enabling them to operate
efficiently and sustainably.
OPERATING IN 36 COUNTRIES
SUPPORTING CUSTOMERS ACROSS A RANGE OF INDUSTRIES*
AND MULTIPLE PRODUCT CATEGORIES
EMEA
Revenue
£1,777m
Change: (1)%
Like-for-like change: (3)%
2023/24: £1,795m
+ Read more on page 33
AMERICAS
Revenue
£907m
Change: (3)%
Like-for-like change: 0%
2023/24: £934m
+ Read more on page 34
ASIA PACIFIC
Revenue
£219m
Change: 2%
Like-for-like change: 0%
2023/24: £214m
+ Read more on page 35
Design and Discrete
Manufacturing
Automation & Control (A&C)
and Electrification
Cables &
Connectors
Semis &
Passives
Facilities &
Maintenance
Test &
Measurement
Other
Mechanical
& Fluid Power
Personal Protection
Equipment (PPE)
& Site Safety
Process
Manufacturing
Facilities and
Intralogistics
Energy and
Utilities
EMEA
61%
Americas
31%
Asia Pacific
8%
Group Revenue
£2,904m
Group revenue
Change: (1)%
Like-for-like change: (2)%
2023/24: £2,942m
>1m
customers
>2,500
suppliers
c. 8,500
employees
Share of
revenue:
Share of
revenue:
40%
42% 13% 4% 6% 6% 4% 4%21%
15% 27% 9%
SMALL BATCH, CONFIGURED PRODUCTION PLANNED AND EMERGENCY MAINTENANCE, REPAIR AND OPERATIONS (MRO)
* Other = 9%
RS Group plc Annual Report and Accounts 20252
Investment proposition
INVESTING TO IMPROVE
EFFICIENCY AND OPERATING
LEVERAGE
Creating, utilising and optimising more
efficient and flexible physical, digital and
process infrastructure
WELL POSITIONED
IN GROWTH MARKETS
Global leader in a large, industrial
maintenance, repair and operations (MRO)
market, growing at GDP+ through-cycle
DIFFERENTIATED
PROPOSITION DRIVING
MARKET SHARE GAIN
Digitally enabled, high-service distributor
of a broad range of technical product and
service solutions for industrial customers that
demand low volumes of critical products
across many categories
1 2 3
DISCIPLINED ACQUISITIONS
ACCELERATING GROWTH
Rigorous investment discipline and clear capital
allocation policy driving accelerated value creation
4
SIGNIFICANT VALUE-
CREATION OPPORTUNITY
FOR ALL STAKEHOLDERS
Generating value through driving strong
operational and financial performance and
investing in growth opportunities that deliver
sustainable cash returns on invested capital
5
THROUGH-CYCLE
VALUE CREATION
TARGETS*
Revenue growth
2X MARKET
(of GDP+)
MID-TEEN
adjusted operating
profit margin
>80%
cash conversion rate
>20%
return on capital
employed
REALISING THE POTENTIAL TO
DELIVER THE RS OPPORTUNITY
* Economic cycle as defined by
GDP growth
RS Group plc Annual Report and Accounts 2025 3GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Chairman’s introduction
We are happy with the progress we
have made despite the challenging
market backdrop.
We have continued to invest in the business in
a focused way to drive improvements which will
accelerate value delivery for all our stakeholders
once the industry returns to growth. In spite of a
challenging market, our performance has been
resilient and progress has been made in each of
our six strategic focus areas.
I am delighted with the leadership of Simon Pryce
and the way he has steered the business through
this difficult year. Good progress has been made
possible by the relentless hard work of our
leadership team and our people right across our
business. They have been extraordinary, and I
would like to thank every one of them for their
passion, commitment and professionalism.
Our strategy
Our strategy is clear and has not changed.
RS is a high-service global product and service
solutions provider to >1m customers. We have
a differentiated competitive proposition within
the industrial MRO market and serve as the
essential link between suppliers and customers
who require high-service, low-volume distribution.
We help our customers build and maintain their
industrial assets in an efficient and sustainable
way. This has enabled us to continue to drive
market share gains despite the market cyclicality.
During the year, RS has continued to strengthen
its digital and technology platform, technical
product offer, customer experience and has
greatly enhanced its executional capabilities.
The market potential is significant, and we are
very confident that we are well positioned to
capitalise on the upcoming opportunities as the
cycle turns.
While our primary focus is to build organically,
we continue to pursue value-adding, strategically
relevant acquisitions. I am pleased to report that
our key acquisitions completed over the last few
years have performed well. Risoul continues to
outperform with strong growth and profits since
it joined the RS family two years ago, and last
year successfully expanded into Trinidad and
Tobago. Similarly, Distrelec, which we bought in
2023, has operated well and integration with our
EMEA business has generated cost synergies
ahead of plan. In April 2024, we acquired Trident
which performed well during the year; we have
successfully integrated back-office functions and
invested in a calibration service laboratory to
accelerate growth. Our mergers and acquisition
(M&A) pipeline remains active, and we aim to
accelerate our growth through further disciplined,
value-accretive acquisitions.
+ For more on our strategy, please see pages
16 to 22
Our culture and values
We are fortunate to have an amazing can-do
culture that exists across our operations
worldwide. During the year, we underpinned this
distinct advantage by continuing to roll out and
embed our four values which encapsulate how our
people work together to succeed. They unite us in
how we should behave and differentiate us from
our competition. Our values help us to build trust
with our customers, suppliers and shareholders,
enabling us to deliver our strategy more effectively
and with better long-term outcomes for everyone.
+ See pages 5 and 6 for more on our values
and culture
Rona Fairhead
Chairman
IMPLEMENTING
OUR STRATEGY
FOR OPERATIONAL
PROGRESS
RS Group plc Annual Report and Accounts 20254
Effective governance and commitment to the
environment and the communities in which we
operate is embedded in our culture and is core to
our purpose, strategy and competitive success.
Our strong environment, social and governance
(ESG) approach is a commercial driver that helps
us accelerate the achievement of our long-term
objectives; we now sell c. 30,000 Better World
products, which help our customers take direct
action on sustainability.
Our performance was again recognised by
external agencies. RS is now included in the
CDP A-list, reserved for the top companies
showing advanced climate leadership, globally.
The Company has also retained its Platinum
EcoVadis medal, placing us in the top 1% of the
150,000+ companies rated. Furthermore, we have
been listed in the S&P Sustainability Yearbook for
the second consecutive year running, positioning
us in the top 15% of companies in our industry.
RS has experienced significant benefits from
harnessing the full potential of the diverse talents
and experiences across the Company, including
on our Board. We are pleased to note that RS was
nominated joint first of FTSE 250 companies for
‘Women on Boards’
*
. RS Group was also listed in
the ‘Women on Boards and in Leadership’ ranking.
+ For more on ESG see pages 45 to 73
Our stakeholders
Our vision is to become first choice for all our
stakeholders: our people, customers, suppliers,
communities and shareholders. Engagement with
each of them is key and feeds into our operating
and strategic plans.
The Board and our leadership team continue to
engage with all our stakeholders to understand
what matters to them, ensuring we are responsive
to their needs and taking action.
We embrace the dialogue with our shareholders
– our owners – and enormously value their
contribution. Our Board and executive team
continued to have significant dialogue with
shareholders throughout the year.
In addition to building a resilient, sustainable
company for our owners, we also recognise the
importance of our dividend to them. We are
therefore pleased to announce a further increase
in our dividend to 22.4p.
+ More details on our Board engagement with our
stakeholders can be found on page 88
Our Board
Simon has brought greater clarity and strategic
focus and has substantially enhanced our ability
to operate. We are confident that, with Simon at
the helm, supported by Kate Ringrose and our
talented Executive Committee (ExCo), RS will be
able to accelerate the strategy and capitalise on
the opportunities that lie ahead.
RS has an outstanding Board of Directors.
They bring a diverse range of experience
and expertise and are a genuine asset to the
Company. Their wisdom, insight and acumen
are invaluable. We continue to shape and build
our talent, so I am pleased to welcome two
new Directors, Carole Cran and Miles Roberts,
who joined the Board on 1 December 2024 and
1 March 2025 respectively. Together, they bring
strong international and sector experience and
have already made powerful contributions.
I would also like to thank Navneet Kapoor, who
stepped down from the Board this year, for his
valuable contribution during his tenure.
Looking ahead
As we navigate the challenging external
environment, we must continue to drive our
strategy and our operational capability and invest
in our key strategic initiatives while managing
costs effectively. We remain positive about the
future for RS Group and feel very confident we
have the right strategy – and the right leadership
– to generate stronger and more sustainable
growth and future returns, which will accelerate
when the market recovers.
Rona Fairhead
Chairman
* Women on Boards: 2024: ftsewomenleaders.com
We are empowered,
take ownership and deliver
what customers need with
energy and passion.
We are adaptable, agile and
inspired to innovate and make positive
changes, always finding ways to
improve, challenge and simplify.
We listen, respect and trust each
other. We seek diverse perspectives.
We collaborate with purpose,
as one connected team.
We care about our impact on
colleagues, customers, suppliers and
communities, today and tomorrow.
OUR CULTURE
AND VALUES
In April 2024, we introduced four values into
our work culture and the rollout has been a
tremendous success. It has given us a universal
language to recognise great behaviour
and constructively challenge each other.
And because the values were shaped by the
people in our organisation, it truly represents
life at RS. Awareness of the values among
colleagues reached 87% in the latest pulse
survey, exceeding our 70% target.
Now embedded in key processes, our values
guide decisions, set expectations and foster
a shared sense of purpose.
We are one team, who deliver brilliantly, by
doing the right thing, to make every day better.
Our values set out what our people need to
do to succeed together. They are how we work
across our business in a consistent way, uniting
us and differentiating us from our competition.
Our values help us to deliver our strategy more
effectively, with sustainable outcomes for all
our stakeholders. Most importantly, they have
become central to what colleagues say and do –
day in and day out.
+ Read more on page 6
RS Group plc Annual Report and Accounts 2025 5GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Our culture and values continued
Our values shape how we work, collaborate and
succeed together. These four stories showcase our
values in action, highlighting real-life examples of
how they drive positive change across RS every day.
CASE STUDY
COLLABORATION
ACHIEVES RESULTS
When we launched RS PRO products on the
Distrelec website, our goal was to expand our
reach in key categories. In only eight months,
sales increased to £1 million through the
Distrelec website, with 13,700 customers
purchasing RS PRO products. This success
was driven by seamless collaboration across
multiple teams working with a common
goal and strengthening our presence in
key markets.
CASE STUDY
RISING TO THE OCCASION
TO BEAT THE CLOCK
At RS, delivering brilliantly isn’t just something
we say – it’s something we do, every single
day. A customer was facing a six-week
operational delay, costing £5,000 per day.
With the clock ticking, the team saw this as
an opportunity to deliver brilliantly by owning
the challenge and finding a solution that
would make the client proud to work with RS.
This wasn’t only about logistics; it was about
rising to the occasion with a positive mindset
and delivering at pace.
CASE STUDY
SPEAKING UP
ALWAYS MATTERS
We are committed to doing the right thing
and conducting business with the utmost
concern for our colleagues. During the year,
we have updated our Speak Up policy and
we now have 11 local language versions.
If employees wish to place an anonymous
report in confidence, then we offer an
independent Speak Up facility, which is
available 24/7.
£1m
in sales in eight months
£5,000
saved daily
11
local language versions
285kg
waste reduced annually
CASE STUDY
WEIGHTY MEASURES
TO REDUCE WASTE
Our global distribution centre (DC) in
Nuneaton, UK, faced a significant challenge:
humidity was causing auto pack lids and
boxes to warp, making them unusable in
the machinery and resulting in daily waste.
The team devised a simple yet effective pallet-
and-perspex tool to apply weight and prevent
warping. Now used daily, it makes every day
better and has successfully reduced waste by
285kg per year.
OUR GUIDING PRINCIPLES
TO SUCCEED
RS Group plc Annual Report and Accounts 20256
Chief Executive Officer’s (CEO) introduction
It has been a year of significant underlying
progress at RS Group. We are executing a clear
and focused plan to improve performance and
deliver sustainable value for all stakeholders.
Our aligned teams are addressing organisational
and process inefficiencies and prioritising
our investment to position RS for accelerated
strategic growth and sustainable value creation.
RS is executing more effectively, with improving
operating metrics, although more difficult markets
mean this has yet to be reflected in absolute
financial performance. I am extremely grateful
and hugely proud of our great people who
continue to embrace the changes we are making
and are working extremely hard to deliver them.
This year, we have faced weaker than anticipated
global industrial demand and geopolitical
uncertainties that continue to impact business
confidence as reflected in weak manufacturing
Purchasing Managers’ Index (PMI) data.
This uncertainty continues and is delaying
recovery in industrial production. Against this
difficult market back drop, RS is performing as
it should. Proxy market data, such as supplier
information and digital search enquiries, are
showing that RS continues to take share across
most of our technical product categories.
We are also managing better the things we can
control, making continued selective strategic
investment and improving our execution.
The cost savings we have delivered were
greater than originally planned, and we have
improved cash generation through better focus.
Our strong balance sheet also gives us the
opportunity to accelerate our strategy through
continued but disciplined consolidation within a
fragmented market.
During the year, we provided more detail on
our business, our strategy, our plan of action
to position RS for accelerated growth and ways
to improve operating leverage and business
efficiency at our Investor Event in September 2024
(full details on our corporate website rsgroup.
com/investors and on page 9). We made good
progress this year and have greater confidence in
our ability to deliver strong and more sustainable
performance as markets recover and generate
significant value for all our stakeholders over time.
Our 2024/25 financial performance
During 2024/25, our revenue declined 1% with
like-for-like revenue down 2% reflecting the
difficult industrial markets. Our performance
improved during the second half of the year,
especially within Americas and Asia Pacific, partly
due to easier comparable data and a more stable
electronics market, and in the fourth quarter
delivered a small increase in like-for-like revenue
albeit with continued variability month to month.
Our average order value declined slightly to
£252 (2023/24: £257) but the average order
frequency increased as supply chain dependability
improved and customers ordered for immediate
need rather than for inventory and availability.
Our industrial product categories continued
to outperform the broader Group reflecting
the relative resilience of these categories, the
importance of our products to customers’
operations and increased focus by our teams on
a more curated and specialist offer. Our Semis &
Passives and Cables & Connectors product ranges
performance remained weak, reflecting a more
competitive electronics market.
Simon Pryce
CEO
DRIVING OPERATIONAL
EFFECTIVENESS
FOR STRONGER
POSITIONING
RS Group plc Annual Report and Accounts 2025 7GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Chief Executive Officer’s (CEO) introduction continued
Our growth accelerators continue to outperform
the wider Group: our own-brand RS PRO grew
by 2% like-for-like and our revenue associated
with our service solutions increased by 6%
like-for-like. Digital revenue in total declined
by 2% like-for-like, but this included 4% like-
for-like revenue growth in digital procurement
solutions, such as eProcurement, used by larger
customers requiring a more integrated and
automated procurement method. Pure web
revenue decreased despite improved conversion,
reflecting reduced web enquiries and lower
demand from more transactional customers.
We are capturing some of this transactional web
traffic with the continued adoption of our digital
procurement solutions.
We generated £29 million of cost savings through
actions, including labour, as we improve our
productivity; with over £38 million of accumulated
savings over the last two years. Additionally, we
delivered £13 million of one-off cost benefit as
we flexed our spending to reflect the difficult
economic backdrop and accelerated the
integration of our acquisition of Distrelec, partly
offsetting charges relating to the restructuring
and integration programme. Our actions are
helping offset cost inflation, more normalised
employee performance-based incentives, higher
variable costs from customers ordering more
frequently and an increase in organic investment
to support RS for further market share growth
and future cost efficiencies. Our adjusted
operating profit margin fell 0.7 percentage points
on a like-for-like basis to 9.4%.
A much-improved cash focus led to an adjusted
operating cash flow conversion of 111%
from improved working capital management.
Our balance sheet remains strong, with net debt
to adjusted EBITDA of 1.1x.
Executing our strategy
We have made significant progress over the
last two years. Our strengthened leadership
team, greater strategic focus and more relevant
operating model is improving consistency and
delivery. We have developed an integrated action
plan to deliver accelerated growth, improved
operating leverage and more operating efficiency.
This has aligned our teams and improved the way
the Group interacts and functions with clarified
accountability enabling more agile decision
making and more disciplined investment and
resource allocation. We are now one year into the
execution and delivery of this multi-year action
plan, including continued investment in our key
strategic areas of focus to further differentiate our
proposition and drive efficiency benefits and are
already seeing operational improvements.
People
Be first choice for employees through
creating an inclusive and engaging
environment where everyone is proud and
excited to come to work, can perform at their
best, develop and thrive.
This year, we continued to strengthen our
senior leadership capability through a mix of
external hires, internal promotions and increased
investment in training and mobility. We launched
a refreshed employee value proposition ‘Go
beyond amazing’ and improved our recruitment
capability leading to over 95% of roles now being
filled via our in-house talent acquisition team,
reducing our agency recruitment costs and time
to hire. We have also enhanced our early careers
programme, achieving a platinum award with the
5% Club in the UK.
OUR
STRATEGIC
ACTIONS
RS has a clear identity – we are a
differentiated distributor of product
and service solutions. How do we win?
We are customer focused. We are product
experts. Our solutions deepen customer
relationships and we drive operational
excellence to deliver efficient and well-
invested physical, digital and process
infrastructure with great people.
Be first choice for
our employees
Target industrial
MRO customers
Increase and curate
our product range
Scale our service
solutions
Strengthen our
customer experience
Drive operational
excellence
+ Read more on pages 17 to 22
Our new values have been successfully embedded
and we are maintaining high engagement
levels despite the significant amount of change
taking place across the organisation and an
uncertain external environment. We enhanced
and improved the effectiveness of our Employee
Resource Groups which support the culture of
belonging and overall wellbeing at RS which is
core to our future success.
Our redesigned employee incentive schemes
and our team recognition tools are proving
effective in creating stronger alignment of
individual objectives with key strategic outcomes
and business performance. This has led to
greater focus, empowerment, accountability and
responsibility. Our key employee operational
metrics remain strong with our voluntary
employee turnover at 9%, better than plan
and target.
Customers
Focus on higher value customers through
harnessing data, embracing strategic
engagement and ensuring a suitable cost to
serve for all customers.
In 2024/25, we continued to invest in tools that
better utilise the extensive data we have on
our customers and their transactions. This is to
better support and serve customers with their
infrequent and difficult to predict but critical
demand for, a broad range of technical products
across multiple categories, in small volumes at
often relatively high frequency, where availability
is valued and key. This typically helps customers to
fulfil their MRO needs for small batch and highly
configured production and design requirements.
These investments also aim to improve our
focus on high lifetime value customers, whilst
continuing to support all customers but ensuring
that we serve them in a cost-effective way.
Our strong balance
sheet gives us the
opportunity to accelerate
our strategy through
continued but disciplined
consolidation within a
fragmented market.”
RS Group plc Annual Report and Accounts 20258
Ongoing investment in RS PRO, our
quality-assured own-brand offer, and accounting
for 14% of Group revenue, grew new product
revenue by 8%. Our Better World product
offer has been enhanced further including
development of a green alternative selling tool
aimed at higher lifetime value customers. We also
increased local sourcing and stocking within
Asia Pacific to lower freight costs and associated
carbon footprint benefits, cut delivery times and
improve availability for customers.
Revenue from new product introductions (PMI)
ahead of target, growing by c. 40% in EMEA
and Asia Pacific, and now accounting for 4% of
revenue. Our enhanced supplier programme is
driving stronger revenue performance in their
brands and delivering procurement benefits.
Solutions and services
Deliver valued, scalable solutions which
builds greater strategic engagement and
drives product pull-through.
We are focusing our wide solutions and services
offer better, prioritising our digital procurement
and inventory management offer. During the
year we re-platformed our eProcurement offer in
Americas and Asia Pacific enhancing content and
order processes through new software planning
tools and expanded and digitalised our custom
order solution, particularly in the US.
A refreshed strategy at RS Integrated Supply
included cutting unprofitable clients, development
of new client acquisitions, implementing robust
cash management and delivering standardisation
and automation to drive cost efficiencies
and scalability.
During the year we have seen 4% growth in
eProcurement revenue. RS Integrated Supply
has delivered c. 140% increase in order book and
improved commerciality.
Experience
Strengthen and tailor our customer
experience to provide a digitally led,
seamless omnichannel service.
RS has a strong digital presence, which is a
source of competitive advantage especially
within the industrial business-to-business
market. We are investing to unify our digital
platform across the Group to provide a seamless
omnichannel experience and remove complexity
and inefficiencies.
In 2024/25, we upgraded and enhanced our
digital platform in Americas which will then be
rolled out across EMEA and most markets in Asia
Pacific over the next three years. We also invested
in best-in-class digital tools such as AI-powered
search capabilities globally and upgraded our
browse facilities within EMEA and Asia Pacific.
Our real-time product tracking system, which
was several years in development, was launched
in the first half with full rollout expected after
we complete the customer pilot. This should
materially improve our customer experience and
reduce customer service enquiries, open orders
and returned or cancelled orders. We are also
tailoring a localised digital infrastructure for Asia
Pacific to enhance our customer experience that
reflects local customer needs, provides more
tailored content and facilitates easier compliance
with regional regulations and standards.
AI search is enabling us to optimise the 84 million
search queries per annum we receive and
redirect our customer service into value-added
sales functions, enhancing customer experience.
There has been a 3.3% increase in search visits
adding to basket and 3.4% improved search
revenue generation from our AI search tools.
In the year, we completed the roll out of a
common customer relationship management
tool across EMEA and the US, built a global
customer database for a single view of customers
and segmented our customers into industry
verticals and value, enabling us to provide them
with a more tailored sales, service and marketing
offer in the future. We also enhanced our Voice
of Customer platform to better differentiate
feedback between transactional customers and
those receiving sales account input. Being able
to identify transaction-only customers means
we will be able to provide a more relevant digital
offer and service, whilst optimising human touch
for our high lifetime value customers, and an
appropriate cost-to-serve.
Revenue from our high lifetime value corporate
customers grew by 4% driven by higher average
order value and average order frequency.
Product and supply chain
Offer technically led and specialist
product ranges supported by strong
supplier relationships.
We continue to invest in strong supplier
relationships, and in our technical product
categories to develop more curated and relevant
ranges for our customers and suppliers. We are
also investing in global supply chain processes
and infrastructure to optimise supply and delivery
to customers, whilst ensuring we manage
inventory and anticipated demand effectively.
Key areas of progress this year include
the successful launch of our new product
management solution which has tripled the
products that can be uploaded to our websites
and reduced onboarding time of technical data
materially. The development of strategic supplier
partnership programmes better support our
growth in MRO, particularly in the Americas.
CASE STUDY
THE RS OPPORTUNITY
What was discussed?
On 24 September 2024 in London,
we hosted an investor event: The RS
Opportunity. Our senior leaders showcased
our investment proposition, what makes
us different and our strategic action
plan to further improve the business to
generate sustainable through-cycle growth
and returns.
How did we respond?
We explained how we are targeting higher
value potential customers, discussing our
product offerings and the types of industries
we serve. We showed new measures we have
taken to improve our customers’ experience,
enabling them to have simple and seamless
transactions with us when searching for
critical parts. This includes our investment in
a new AI-powered search engine and data
insights, which personalise and tailor the
experience for customers, enabling them
to prioritise choices around sustainability,
efficiency and value.
What was the outcome?
More than 70 investors and analysts
attended with a further 68 joining our
virtual stream. They were able to explore
two experience rooms, to understand
what we sell and how we market to our
customers globally.
RS Group plc Annual Report and Accounts 2025 9GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
and rationalised our global shared business
services delivering improved productivity and
associated cost benefits. We are well on the
way to delivering the operational efficiencies,
cost savings and increased scalability, that will
equate to a c. 150bp (equivalent to c. £45 million)
of operating margin improvement over the
medium term.
Acquisitions that accelerate
our strategy
There is a solid pipeline of acquisition
opportunities that can accelerate our strategy
in a value disciplined way, supported by our
strong balance sheet. Selective acquisitions can
enhance our presence in key markets, accelerate
our operating leverage, strengthen product
specialisation and expand our solutions and
services portfolio. We are, however, mindful of the
current macro uncertainty and will remain value
disciplined in the way we assess opportunities.
Integration of our recent acquisitions has
continued at pace and remain on track to deliver
returns that more than cover our cost of capital
within three years. We are particularly pleased
with the progress our teams are making in
integrating Distrelec and RS EMEA, which is
materially exceeding the initial benefits case.
This has included migrating customers to RS,
exiting the Distrelec third-party managed DC
in the Netherlands and utilising our facilities
across Europe. At the end of the year, we agreed
the divestment of Distrelec’s sales activities in
Finland and the Baltics, for c. £5 million, to our
long-term distribution partner in the region,
Boreo Plc. RS will continue to supply Distrelec
customers in these markets through an expanded
distribution agreement.
The acquisition of Trident in Perth, Australia, in
April 2024 has expanded our service capability,
provided local fulfilment centre capacity in the
region and opened opportunities with customers
in the resources sector. Trident is performing
ahead of our investment case despite challenging
markets in Australia.
Chief Executive Officer’s (CEO) introduction continued
Focusing on sustainability for
stronger value creation
We continue to accelerate the delivery of our
2030 ESG action plan to protect people and
the planet, whilst leveraging opportunities for
commercial growth for RS and our stakeholders.
Sustainability remains an important opportunity
for RS and a priority for our high-value customers
who expect a choice of sustainable products and
services that enhance operational efficiency and
reduce costs, with detailed and transparent ESG
reports to comply with tightening regulations.
Working closer with our suppliers to develop an
industry-leading sustainable product framework
is enabling our customers to make more
sustainable and responsible product choices.
This includes a dedicated range of c. 30,000 Better
World products from over 132 suppliers, digitally
tagged on RS websites.
We made significant progress in delivering a more
sustainable distribution service (DCs, packaging
and logistics) to provide a better service to
our customers and reduce our environmental
impacts. During the year, we reduced our Scope 1
and 2 emissions by 7% on a like-for-like basis from
2023/24; logistics emissions intensity in Europe
has fallen by 6% and in Asia Pacific by 15%, and
94% of packaging is recyclable with 93% of group
electricity from renewable sources. Due to existing
outperformance, we have extended our 2030
ambitions to reduce packaging intensity and
transport emissions intensity from our 2019/20
baseline to 45% and 35% respectively.
I was delighted that our progress towards
advancing sustainability resulted in us making
the CDP A list this year, improving from A- to A
and maintaining our Platinum EcoVadis status.
These top-tier ESG ratings recognise the strength
of our commitment, action and disclosure, and
the robustness of our ESG action plan.
Exciting long-term potential
RS provides the essential link between suppliers
of industrial products and a diverse customer
base that displays common buying behaviour
associated with infrequent and difficult to predict
but critical demand for a broad range of technical
products across multiple categories, in small
volumes at often relatively high frequency where
availability and service is valued and key. Our wide
product offer, specialist expertise, digital-led
proposition, strong distribution capabilities and
global infrastructure, combined with our growing
focus on solutions and services, are driving
ongoing market share growth. We also continue
to invest to improve our operational effectiveness
and drive better operating efficiencies.
Our underlying progress to date gives us
increased confidence in delivering our medium-
term financial targets when the market recovers
as volume growth delivers additional leverage to a
more efficient operating model.
Our investment thesis remains compelling. RS is:
– uniquely positioned in fragmented markets with
attractive through-cycle growth characteristics
– driving market share gains through a
differentiated technical and digital product and
service solutions offer
– investing to improve efficiency and operating
leverage of our global infrastructure to drive
significant margin expansion
– accelerating growth through
disciplined acquisitions
– a significant and sustainable value
creation opportunity
We remain confident of delivering our targeted
financial outcomes in the medium term of
revenue growth of twice our market, mid-teen
adjusted operating margin, cash conversion of
80% and a sustainable return on capital of more
than 20%.
Simon Pryce
CEO
Operational excellence
Delivering efficient physical, digital and
process infrastructure, improved operating
leverage and marginal drop-through.
We are making significant progress in improving
operational efficiency and reducing complexity
as we harmonise and upgrade our systems,
processes, technology and digital infrastructure.
We continued to invest in our physical
infrastructure: expanding our distribution centre
(DC) in France, increasing capacity in our US
DC through increased automation and scale
and accelerating the closure of the Distrelec
DC to improve the efficiency and reduce the
cost of the RS distribution network quicker than
originally planned.
We are simplifying and upgrading our technology
infrastructure and digital landscape, aligning our
data and moving to standardised and globally
harmonised, cloud native technology platforms.
This is a multi-year programme that has only
just commenced but moving to best-in-class
applications for each function, module-by-module,
will deliver significant operational and financial
benefits in the medium term, create increased
capacity, reduce project risk and importantly
improve agility and scalability.
As we upgrade our technology platform and
applications estate, we are standardising and
modernising our middle and back office processes
which will ultimately reduce our cost base and
improve productivity, scalability and flexibility.
We are consolidating and better leveraging our
global shared business services, strengthening
our resource allocation planning and processes
and improving our operational oversight
and control environment. Standardising and
streamlining our project management procedures
will drive greater efficiency, consistency and
collaboration across the Group.
During the year we rationalised c. 40 technology
applications, reduced our headcount by c. 4%,
began the migration of our Distrelec customers
RS Group plc Annual Report and Accounts 202510
Our customers
Our customers buy a
broad mix of industrial and
specialist products across a
diverse range of categories
in small volumes. We simplify
our customers’ procurement,
drive cost and process
efficiencies and enable them
to operate more sustainably.
Why they choose RS:
– We help customers
consolidate their spend
by providing a wide range
of products.
– We have a broad, stocked
range of categories at high
availability and the ability
to reach customers quickly
and reliably.
– We provide a brilliant
service that is fully
digitally enabled.
– We are a technical,
trusted partner.
Our suppliers
Our suppliers need a
distributor who provides
access to a broad dispersed
customer base, offers
technical support, and
promotes their new and
existing products at high
levels of inventory availability.
We extend our suppliers’
reach allowing them to access
customers in a way that
reduces their cost to serve
and ensures they remain
relevant in the market.
Why they choose RS:
– We have a well-
invested infrastructure.
– We provide an efficient
route to market.
– Our digitally enabled
approach gives suppliers
great customer insight and
marketing support.
– We are a dependable
and sustainable long-
term partner.
We provide the essential link between suppliers and industrial customers who buy a wide
range of products to support the MRO and small batch production of their businesses.
Understanding our customers’ needs and providing a diverse range of product and service solutions allows our
customers to keep their businesses running smoothly and efficiently in the most cost- and time-effective way.
WHAT WE DO
OUR DIFFERENTIATED PROPOSITION
Small batch production Maintain Operations
>2,500
Suppliers
>1m
Customers
>830,000
Stocked products
60%
Revenue through
digital channels
1.
High-service product
and solutions partner
4.
Multi-category
product offer for
industrial customers
2.
Technical and
specialist expertise
5.
Global distribution
infrastructure
3.
Digitally enabled
experience
Our business model
THE ESSENTIAL LINK BETWEEN
CUSTOMERS AND SUPPLIERS
Repair
RS Group plc Annual Report and Accounts 2025 11GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
PEOPLE
We create an inclusive and engaging environment
where everyone is proud and excited to come to work,
and can perform at their best, develop and thrive.
CUSTOMERS
We are a trusted problem solver, delivering a connected
experience to support our valued industrial customers
to keep their industries going.
Our stakeholders
It is important for us to engage with all our
stakeholders: our people, customers, suppliers,
communities and shareholders. We need to
understand what matters to them, ensuring we
are responsive to their needs and adding value.
The views of our stakeholders are fundamental
to us becoming first choice and driving a
long‑term sustainable business and we have
defined KPIs for each of our stakeholders.
Our business model enables us to create value
for all our stakeholders and deliver our vision to
become first choice.
BECOMING FIRST
CHOICE FOR OUR
STAKEHOLDERS
What matters to our people
– Clarity on performance expectations and link to strategy delivery
– High-performance, purpose-led culture where employees
feel they belong and can be their authentic selves
– Investing in employees’ development and growth for skills
needed today and tomorrow
– Providing support to employees in key work and life moments
– Helping employees take care of their money
How we engage
– Monthly functional team talk sessions
– My Voice and quarterly pulse employee engagement surveys
– Regular senior leader calls and meetings
– Non-Executive Director initiatives and interactions
– Training programmes and development opportunities for all
– Employee Resource Groups (ERGs): Bloomers, Elevate,
Embrace, LifeWorks and Spectrum
– Health and wellbeing resources
– Access to personal financial advice and pension seminars
What we have achieved
– Launched first global employee value proposition (EVP):
Go Beyond Amazing
– Supported 306 people through UK apprenticeships
– Became a platinum member of the apprentice 5% club in the UK
– Won BOC Brilliance Award Best Internal Communications
Campaign for global values launch
– More ambitious ERG plans; launch of LifeWorks ERG with
more than 1,000 regular participants
– Won Large Recruitment Team of the Year award from Talent Labs
– Achieved the top score of 100 on the Human Rights
Campaign Foundation’s Corporate Equality Index - distinction
of Equality 100 Company
– Shortlisted in Safety and Health Excellence Awards
– Our voluntary employee turnover remains below the industry
average at under 9%
What matters to our customers
– A broad range of products combined with technical
expertise, high availability and reliable service
– Sustainable and differentiating solutions to solve problems
and unlock opportunities
– Ease of doing business - a seamless experience which saves
customers effort and time
– A partner to build a more sustainable and socially
responsible future
How we engage
A connected, personalised experience delivered through:
– Digital capability - online or integrated in customer system
– Multi-channel purchasing capability – website
and eProcurement
– Award-winning customer service and technical support
– Dedicated account managers and sales teams
– Onsite customer support
– Events, trade fairs, forums, social media and thought leadership
– Customer feedback programmes
What we have achieved
– Rolled out customer relationship management tool across
EMEA and Americas connecting our people with our
customers more effectively
– Partnered with suppliers to improve product findability,
technical information and merchandising
– Launched insight and decisioning engine to better
personalise customers’ experiences
– Improved data quality and reliability, reducing fraud and
mitigating risk through automated address validation
– Enhanced a broad customer feedback programme to better
meet customers’ needs and improve individual experiences
– c. 30,000 Better World products from 345 product families
available in 30 countries
The value we create
My Voice engagement score
72
Linked to our ESG goals The value we create
Net promoter score (NPS)
48.5
Linked to our ESG goals
RS Group plc Annual Report and Accounts 202512
SUPPLIERS
We are a technically led, service oriented supplier partner
of choice, providing an unrivalled and cost‑effective market
reach to our broad industrial customer base.
COMMUNITIES
We inspire the next generation of engineers and
innovators and support our communities worldwide to
improve people’s lives and create a more sustainable world.
SHAREHOLDERS
We create superior economic value through delivering reliably
for our shareholders, generating consistent and sustainable cash
returns on invested capital well in excess of our cost of capital.
What matters to our communities
– Providing educational initiatives to young people
– Providing support to our local communities
How we engage
– Providing employability skills, practical experience and
initiatives aimed at growing inclusion in science, technology,
engineering and mathematics (STEM) subjects and careers
– Supporting academic institutions to deliver high-quality
engineering and technology education
– Competitions to encourage innovation
– Empowering and enabling our people to support
communities through our global social impact partnership,
local giving and volunteering
– Organising and supporting community events and awards
What we have achieved
– Reached 913,000 young engineers and students through
educational technologies learning content and skills
development opportunities since 2020/21
– Expanded the RS Student Project Fund to rest of EMEA,
providing RS products for innovative and diverse projects
– Delivered over 40 free Super Skills sessions to enhance
employability skills and strengthen the talent pipeline
– Ran robotics, gaming, coding and basic electronics
workshops with partner GirlTech for over 230 children in Italy
– Over 400 RS employees volunteered with The Washing
Machine Project (TWMP) to build 126 flatpack washing
machines for Greece, Gaza and Uganda
What matters to our shareholders
– Sustainable growth and superior returns
– Understanding our business and our strategy
– Strong corporate governance
– ESG
How we engage
– Annual General Meeting (AGM)
– Investor roadshows, meetings and conferences
– Stock exchange announcements, press releases and
results briefings
– Ongoing dialogue with analysts and investors (both current
and potential)
What we have achieved
– Engaged with our top 30 shareholders (representing c. 86%
of the share register) and held a total of 18 meetings with
shareholders in respect of the revised Remuneration Policy
(see pages 112 to 118 for details)
– Held an investor event in September 2024 (read more on
page 9)
– Met with over 85% of our top 20 shareholders
– Achieved a CDP Climate Leadership score of A and
maintained an EcoVadis platinum rating
– Won awards for corporate website: gold for best use of
digital from engineering, manufacturing, industrial and
basic materials sector; and silver for best corporate website
(FTSE 100)
What matters to our suppliers
– A cost-effective way to reach a dispersed industrial
customer base
– Data-driven product management
– Knowledge of customers’ needs and trends
– Ease of doing business
– Offering a full range of product and service solutions to our
customers, including a range of sustainable products
– Positive environmental and social impact, operating to high
ethical standards
How we engage
– Dedicated account managers
– Supplier strategies and scorecards with defined targets
– Developing joint end-user opportunities
– Regional and global supplier events
– RS Connect events – partnering with suppliers to connect
with customers
– Seamless new product introductions
– Supplier partner programme – boosting brand visibility and
digital performance
– Regular engagement with suppliers on ESG action plans/our
2030 ESG action plan
What we have achieved
– Launch of a new PMS
– Worked with 132 suppliers to extend Better World products’
framework and range to cover c. 30,000 products
– Implemented a programme to source, store and deliver
products closer to the customer
– ESG is a core theme in our strategic supplier approach
– Attended several industry-leading trade shows including
Smart Production Solutions (SPS) and electronica
The value we create
Number of new NPI¹
228k
Linked to our ESG goals
The value we create
Number of young engineers
and innovators supported
913k
Linked to our ESG goals
The value we create
Earnings per share (EPS)
32.5p
Linked to our ESG goals
1. Excluding Risoul, domnick hunter and Trident
RS Group plc Annual Report and Accounts 2025 13GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Our marketplace
THE MARKETS IN WHICH WE OPERATE
We operate in a large and fragmented industrial market and are one of a few global distributors
of industrial MRO product and service solutions. We estimate our serviceable addressable market
to be c. £130 billion which includes added-value distribution (high service, low volume) within RS’
chosen countries and product categories. Despite its size, much of the market is still local and
many of our competitors are independent businesses and regional firms which specialise in a
narrow product offering or limited service solutions and have less developed digital capabilities.
Our customers have common needs, including small order size, high availability, digital methods
of order and payment management, technical expertise and service capability.
WELL POSITIONED
FOR SUSTAINABLE GROWTH
A broad and deep product offering
We have the product range, superior availability and responsive service capabilities that enable us
to offer industrial and MRO products globally. Our electronics range concentrates mainly on the
sub-categories associated with industrial requirements.
Our solutions and services
We have solutions that span our customers’ asset lifecycles as they manage their design,
procurement, inventory and MRO needs.
A&C and
Electrification
Mechanical & Fluid Power
Cables & Connectors
PPE & Site Safety
Test & Measurement
Facilities & Maintenance
Semis & Passives
(including single-board
computing)
Unnamed major competitors
1 2 3 4 5 6 7 8 9
Product categories
A&C and Electrification
– –
Cables & Connectors
– – –
Semis & Passives (including
single-board computing)
– – – – –
Mechanical & Fluid Power
– – – – –
Facilities & Maintenance
Test & Measurement
–
PPE & Site Safety
Full offer
Partial range
Design &
Technical
Delivering
product
know-how to
improve
customers’
applications
Procurement
Streamlining
and automating
customers’
procure to
pay process
Inventory
Improving
productivity
and reducing
working capital
Maintenance
Supporting
equipment
effectiveness
and quality
assurance
Custom order
Accelerating
manufacturing
capabilities
Optimising MRO
supply chain
including data,
procurement
strategy, software
as a service
and storeroom
Key:
Estimated RS share of market
Research
Specify
Compare
Procure
Partner
Install
Maintain
Repair
Improve
Solutions and services
RS Group plc Annual Report and Accounts 202514
We continue to see five key trends that are shaping the
markets we operate in. As we execute our strategic action
plan, we continue to be agile, reacting to the ever‑changing
market demands and future proof our business, while
remaining focused on our long‑term vision.
TRENDS THAT ARE
SHAPING OUR MARKET
Our B2B customers are expecting
a personalised, seamless experience
mirroring the B2C online experience
while providing features specific to
business procurement. Our suppliers
want a partner that understands
their technical, specialist products
and can bring their products to
market successfully.
Large B2B customers increasingly
require more than simply a supplier
of products seeking solutions
that solve their technical and
procurement challenges.
Our customers are seeking to
simplify their supplier base and
buying efficiency while being assured
of high-quality, authentic products.
Receiving products and services from
one provider saves time and reduces
total cost of ownership.
Consolidation in the industrial
distribution market continues to
increase, doubling over the last 10
years, driven by development of
geographic, technical and digital
capabilities
1
. This will accelerate
scale, extend reach and lead to
improved efficiencies.
Sustainability is a top priority for our
high-value customers. They expect
sustainable products and services
that enhance operational
efficiency and reduce costs,
greater choice and transparency in
sustainable products and detailed
ESG reporting to comply with
tightening regulations.
EASE OF DOING BUSINESS PROVIDING SOLUTIONS ONE-STOP SHOP CONSOLIDATION INCREASED FOCUS
ON SUSTAINABILITY
Our strategic response
– Enhancing digital platforms to
simplify procurement for our
customers, making it easier to do
business with us and control spend
– Continued investment in our
supply chain networks and
distribution infrastructure to
increase capacity and local
sourcing capabilities
– Connecting our channels to give a
seamless experience
Our strategic response
– Developing a digitally led solutions
offering that increases product
pull-through
– Differentiating through
technical solutions leveraging
our expertise to create sticky
customer relationships
– Targeting specific industry verticals
with service solutions that resonate
with our customers’ needs in
growing sectors
Our strategic response
– Maintaining a strong balance
sheet to support targeted
consolidation opportunities
– Disciplined focus on M&A that
accelerates our strategy, expands
product service or geographic
capabilities, or realises scale
economics leveraging physical,
digital and process infrastructure
– Strengthening our corporate
development and integration
resources to support a pipeline
of potential acquisitions
and integration
1. Consolidation statement supported by
McKinsey M&A Annual Report 2025 which
also specifies a 5% increase in deal volume in
industrials and electronics in 2024
Our strategic response
– Maintaining our unique broad
offering of readily available
products for industrial customers
– Deepening our core industrial
product category of A&C
and Electrification
– Accelerating our new product
introduction capabilities to develop
further an expanded product range
and elevate the specialist product
ranges of our acquired businesses
Our strategic response
– Enabling customers to select
more sustainable and responsible
product choices they can trust,
supported by clear, credible and
verified product sustainability
claims on RS websites
– Providing suppliers with an
industry-leading sustainable
product framework and ESG action
plan support, along with exciting
go-to-market opportunities
to promote their sustainable
product innovations
– Implementing a robust ESG plan
reinforced by transparent data
and reporting; top-tier ESG ratings
recognising the strength of our
commitment, action and disclosure
RS Group plc Annual Report and Accounts 2025 15GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Our strategy
+ Read more about our ESG action plan on pages
45 to 73
Our vision is to be first choice for our people, customers,
suppliers, communities and shareholders. This vision
is supported by a focused strategy, and associated and
aligned action plan to deliver long-term and sustainable
value for all our stakeholders.
This strategy aims to deliver accelerated growth
and improvement in key areas, all underpinned by
a purpose-led culture, clear and embedded values,
a clearly defined operating model and excellent people.
Solutions
We make our customers’
lives easier across the
design and maintain
lifecycle, which drives
stronger relationships,
recurring revenue
and greater customer
lifetime value.
+ Read more on page 20
Products and suppliers
We will maintain our broad
product range, with a
strong focus on A&C and
Electrification. We will also
increase and curate a range
in adjacent categories and
a broader offering tailored
to specific customer needs,
leveraging our unique
regional strengths.
+ Read more on page 19
Customers
While continuing our unique
service proposition for other
relevant sectors, we are
targeting customers with
a high lifetime value and
aconsolidating behaviour
in key vertical markets.
+ Read more on page 18
Operational excellence
We are improving our
operational effectiveness
to drive efficiencies in
our technology and
digital processes and
physical infrastructure.
+ Read more on page 22
People
Our robust tools and insights will
enable us to attract, develop, engage
and retain the talent we need to meet
our long-term strategic goals.
+ Read more on page 17
Experience
We provide a digitally
enabled experience,
powered by human touch
and specialist knowledge.
Our customer experience
is tailored to customer type
and potential lifetime value.
+ Read more on page 21
A FOCUSED STRATEGY
FOR LONG-TERM GROWTH
Customers
Target high lifetime value
customers who buy a broad
mix of industrial MRO
products in small volumes
Operational
excellence
Leverage eﬃcient
physical, digital and
process infrastructure
sustainably
Experience
Strengthen and tailor our
digitally enabled, seamless
customer experience across
all interactions with us
Solutions
Scale solutions that pull
through product and drive
customer loyalty
Products
and suppliers
Focus on technically led
and specialist ranges
within a broad product
oﬀer, with a focus on
A&C and
electriﬁcation
RS Group plc Annual Report and Accounts 202516
Our people plan
The RS people plan details our approach
to attracting, developing, engaging and
retaining an outstanding team to meet our
long-term strategic and operational aims.
Our vision for our people is to be first choice
for employees and the business by creating
an inclusive and engaging environment where
everyone perform at their best, develop
and thrive.
Our people plan has been refined and evolved
to focus on the core pillars of talent, capability,
diversity and inclusion (D&I) culture, reward and
recognition, and our operating model. Guided by
our values and behaviours and underpinned by
communications, technology and data, this model
ensures that we have robust tools and insights to
attract, develop, engage and retain the talent we
need to meet our long-term strategic goals.
Through our people plan, we are confident we
will continue to build and support an outstanding
RS team who will embody our values, execute our
strategy brilliantly and deliver high performance
to create long-term value for all our stakeholders.
PUTTING
PEOPLE FIRST
OPERATING MODEL
Delivering a simple and
scalable operating model
D&I
A diverse workforce that can
bring their whole selves to work
CULTURE
An inclusive and
engaging culture
TALENT
Creating a strong
and diverse pipeline
CAPABILITY
Building leadership, manager
and functional excellence
REWARD AND RECOGNITION
Compelling reward and
recognition that drives
engagement and performance
UNDERPINNED BY COMMUNICATIONS, TECHNOLOGY AND DATA
First choice for our business
Supporting and enabling our business to
meet its strategic growth aspirations.
First choice for our people
Creating an inclusive and engaging
environment where everyone is proud and
excited to come to work and can
perform at their best, develop and thrive.
RS Group plc Annual Report and Accounts 2025 17GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Our strategy in action
To be our customers’ first choice, we must provide
the relevant products and services that solve their
needs. We deliver excellence through a connected
experience and a suite of valued product and
service solutions for industrial customers.
While continuing our unique service proposition
for other relevant sectors, we are targeting
customers with a high lifetime value and a
consolidating behaviour in key vertical markets.
Our target customers are those industrial
customers who purchase small volumes of
multi-category MRO or small batch production
products, ranging from global multi-site operators
to small single-site customers.
£252
average order value
TARGET INDUSTRIAL
MRO CUSTOMERS
PROVIDE CONNECTED SERVICES TO ATTRACT
HIGHER VALUE CUSTOMERS
In 2024/25, we launched an initiative to supply spares and parts for aging
wind turbines, addressing long-standing supply chain issues. Our bespoke
catalogue simplified product categorisation, increased stock of high-failure
items and our new obsolescence notification process set new standards in
reliability and efficiency. We started by identifying 10 strategic suppliers and
expanding our catalogue with over 200 relevant spares and parts to support
maintenance of aging turbines.
+ Read more on page 55
KEEP
TURBINES
TURNING
AND THE
LIGHTS ON
RS Group plc Annual Report and Accounts 202518
FOCUSING ON PPE AND WORKWEAR SUSTAINABILITY
We have identified sectors where we can make a tangible impact by
encouraging suppliers to achieve Better World product credentials. Our
first focus area is on suppliers of PPE and workwear products added to
the Better World product range.
These products are essential, but typically have short lifecycles. A shift towards
sustainability will reduce waste and create a commercial opportunity with
customers who have strong ESG commitments. So far, we have engaged 32
PPE and workwear suppliers to add 245 products to the range.
+ Read more on page 54
INCREASE AND
CURATE OUR
PRODUCT RANGE
We offer a broad and deep range of industrial
MRO products to meet our customers’ needs
across seven industrial categories. We will
continue to increase and curate our range, with a
specific emphasis on A&C and Electrification, and
a relevant broad offering in adjacent categories,
tailored to specific customer needs while
leveraging our unique regional strengths.
Our strong and extensive supplier partnerships
ensure wide product choice, availability and
alternative brand choices, including our own
brand, RS PRO. We have also introduced a new
sales tool designed to make it easier for our
strategic customers to choose our Better World
product alternatives.
>830k
stocked products
BETTER
WORKWEAR
FOR A
BETTER
WORLD
GOVERNANCE REPORTSTRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATION RS Group plc Annual Report and Accounts 2025 19
Our strategy in action continued
SCALE OUR
SERVICE
SOLUTIONS
IMPLEMENTING OUR RS CONTROLSTOCK
®
SOLUTION
FOR ENHANCED SAFETY AND SAVINGS
We have helped Butternut Box, the European market leader in fresh dog food,
streamline its stock management and ensure immediate availability of the right PPE for
staff. With RS ControlStock
®
, located in satellite stores close to production, Butternut
Box can perform a digital stock search through a kiosk and quickly locate and retrieve
the item as required. Replenishment is automated to avoid stock-outs or overstocking.
This simplified process increases productivity and provides real-time consumption data
and insights which reduces carrying costs for the company. We have enabled Butternut
Box to save over 1,700 process hours, equating to £30,000+ per annum of savings,
ensuring return on investment.
+ Read more on page 55
We offer solutions, mainly digital, that create
customer loyalty and address customers’
problems to drive product pull-through. We also
have several services such as our maintenance
solutions, calibration, panel building and our
safety solutions, which include PPE and hygiene
control solutions.
We make our customers’ lives easier across
the design and maintain lifecycle, which drives
stronger relationships, recurring revenue and
greater customer lifetime value.
25%
of revenue from
service solutions
IMPROVE
STOCK
MANAGEMENT
TO BOOST
EFFICIENCY
AND SAFETY
RS Group plc Annual Report and Accounts 202520
We provide a digitally enabled experience
powered by a human touch and specialist
knowledge. We aim to provide a seamless
customer experience, tailored to customer type
and potential lifetime value.
We are focusing on providing a more personalised
and bespoke customer service for high-value
customers as we optimise our cost to serve.
This will deliver sustainable cash returns and
further differentiation from marketplaces and
pure digital players.
48.5
Net promoter score
STRENGTHEN
OUR CUSTOMER
EXPERIENCE
INTRODUCING THE NEWEST AND LATEST PRODUCTS
ON OUR WEBSITE
Our new PMS focuses on improving our capacity, efficiency and speed to introduce
the newest and latest products from our suppliers to give customers more choice
and quicker access to items. We increased NPI velocity by around 700% by the end
of the first phase of PMS, with a record 4,238 products going live on our website on
a single day.
During the five-week phase, we also saw an average launch time of 4.3 days with
more than 23,000 lines ranged and 19,000 new ones live on our website. We have
now set ourselves a target of making 30,000 new products go live on our website
every month at an average time to launch of seven days.
IMPROVE
CAPACITY
AND SPEED
FOR GREATER
CUSTOMER CHOICE
GOVERNANCE REPORTSTRATEGIC REPORT 21RS Group plc Annual Report and Accounts 2025OTHER INFORMATIONFINANCIAL STATEMENTS
Our strategy in action continued
DRIVE
OPERATIONAL
EXCELLENCE
We are driving our operational excellence
through investment in our digital, process and
physical infrastructure to globally harmonise our
processes to build a scalable, agile foundation, to
improve efficiency and to continuously enhance
the experience for our customers, suppliers
and colleagues.
We will have the ability to easily benchmark our
performance against the top quartile within
the industry and evolve our operations as new
technologies become available.
2.7
inventory turn
TRANSITIONING TO A NET ZERO FLEET
One of the ways we are delivering operational excellence, as well as
reducing our direct carbon footprint, is by transitioning our company car
and van fleet to electric and hybrid vehicles and encouraging adoption
by our people. In 2024/25, we increased the proportion of company cars
that are electric or hybrid for the Group to 39% (2023/24: 30%) and for
the UK to 86% (2023/24: 82%).
+ Find out more on page 49
ON OUR ROAD
TO NET ZERO
ELECTRIFYING
OUR FLEET
RS Group plc Annual Report and Accounts 202522
Accelerating growth through acquisition
As well as investing in our strategy organically, the Group sees the continued potential for
acquisitions to help accelerate our strategy. We have a highly disciplined investment criteria
and acquisitions must have a strong strategic fit, a clear integration roadmap to ensure
successful integration to the Group, and generate material value, while achieving our cost
of capital within three years of ownership.
We continue to pursue strategically relevant acquisitions that offer:
ACQUISITION INTEGRATION
DRIVING VALUE CREATION
The acquisitions of Distrelec, Risoul and Trident
underscore our ability to generate substantial
financial and strategic value, highlighting
our growing proficiency in developing robust
integration capabilities.
Distrelec has comparable products, customers
and markets to our existing core EMEA
business. We are exceeding our initial
assumptions on net synergies.
Risoul has maintained impressive growth
with strong, cross-business learning and is
beginning to benefit from the Group’s
digitisation expertise with opportunities to
further enhance its growth potential across
the region.
Trident in Australia reported strong revenue
growth in the first year of RS ownership and we
are continuing to create value in line with the
integration plan and acquisition case.
We continue to demonstrate our ability to
acquire high-quality businesses and increase
their potential, in combination with our
underlying core businesses and a strong focus
on operational efficiency.
CASE STUDY
OUR GROWTH
AMBITIONS
OPERATING LEVERAGE GEOGRAPHIC OPPORTUNITIES
PRODUCT EXTENSIONS AND ADJACENCIES PRODUCT AND SERVICE SOLUTIONS
Operating
leverage
Geographic
opportunities
Product
extension and
adjacencies
Product
and service
solutions
May 2018
Jan 2019
Dec 2020
Jan 2021
Feb 2021
Jun 2022
Jan 2023
Jun 2023
Apr 2024
RS Group plc Annual Report and Accounts 2025 23GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Key performance indicators
Our six financial key performance
indicators (KPIs)help us to run our
business. They measure the successful
implementation of our strategy and
monitor and drive our progress against
strategic and operational objectives,
while enabling us to react rapidly to
changing markets. The following pages
provide details of our KPIs which have
been in place during 2024/25.
FINANCIAL
KPIS
Like-for-like
revenue growth
Adjusted
1,2
operating
profit conversion
Adjusted
1,2
operating
profitmargin
Adjusted
1,2
earnings per share
(EPS)
(2)% 22.1% 9.4% 39.1p
24/2523/2422/2321/2220/21
1
26
10
(8)
(2)
24/2523/2422/2321/2220/21
22.0
28.4
29.7
24.3
22.1
24/2523/2422/2321/2220/21
9.4
12.5
13.5
10.4
9.4
24/2523/2422/2321/2220/21
31.3
51.3
63.6
42.9
39.1
By driving a differentiated customer
experience and providing innovative
solutions, we aim to drive market
share gains and higher revenue
growth which, in turn, drives profit
growth. Like-for-like revenue
growth is adjusted for trading
days, currency movements and to
exclude the impact of acquisitions
until they have been owned for a
year. See page 29 for further details.
We are constantly striving to
make our operating model as lean
and efficient as possible so we
can convert a higher percentage
of gross profit into adjusted
operating profit. Our aim is that
each region, each market and each
individual takes responsibility for
our performance and constantly
questions whether we can do
things more efficiently to drive
greater returns. See page 30 for
further details.
A great customer experience,
high-performance team and
operational excellence should all
drive improvement in adjusted
operating profit margin. A higher
adjusted operating profit margin
should drive higher returns for
ourshareholders. It is adjusted
operatingprofit expressed
as apercentage of revenue.
See page30 for further details.
Adjusted EPS is a measure
used byinvestors in deciding
whether toinvest in the Company.
It is ameasure of the growth
and profitability of the Company
that also reflects management
performance. See page 30 for
further details.
Link to remuneration
Performance measure
in annual incentive
Link to remuneration
Performance measure in
long term incentive plan
1. Adjusted excludes amortisation and impairment of intangible
assets arising on acquisition of businesses, acquisition-related
items, substantial reorganisation costs, substantial asset write-
downs, one-off pension credits or costs, significant tax rate
changes and associated income tax (see Note 3 on pages 154 to
158 for reconciliations).
2. 2023/24 has been restated. See Note 32 on pages 191 to 195
for further details.
RS Group plc Annual Report and Accounts 202524
Return on capital employed
(ROCE)
2
Adjusted
2,3
operating cash
flow conversion
15.2% 110.8%
24/2523/2422/2321/2220/21
19.4
28.7
30.8
17.1
15.2
24/2523/2422/2321/2220/21
100.3
70.8
92.0
83.3
110.8
ROCE is a measure used by
investors in deciding whether to
invest in the Company. A tight focus
on working capital control and
more disciplined capital investment,
coupled with increased profitability,
will drive improved returns for our
shareholders. ROCE is measured
as adjusted operating profit
expressed as a percentage of the
monthly average of net assets
excluding net debt and retirement
benefit obligations. See page 32
forfurther details.
Through tight working capital
management and disciplined
capital investment, we aim to
convert a high percentage of our
operating profit into operating
cash flow. Adjusted operating
cashflow conversion is defined
asadjusted free cash flow before
income tax and net interest paid,
as a percentage of adjusted
operating profit. The higher the
conversion, the more cash we
have available to invest in our
business to drive future growth
and returns for our shareholders.
See page 31 forfurther details.
Link to remuneration
Underpin in long term
incentive plan
3. Adjusted excludes the cash impact of substantial
reorganisation costs and acquisition-related items
(see Note 3 on pages 154 to 158).
RS Group plc Annual Report and Accounts 2025 25GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Key performance indicators continued
CUSTOMER PEOPLE HEALTH AND SAFETY
Group rolling 12-month
NetPromoter Score (NPS)
1
Employee
engagement
Percentage of management
that are women
All accidents
(per 200,000 hours)
48.5 72 37% 0.44
24/2523/2422/2321/2220/21
54.4
50.6
49.6
50.6
48.5
24/2523/2422/2321/2220/21
74
75
78
75
72
24/2523/2422/2321/2220/21
30%
32%
30%
34%
37%
24/2523/2422/2321/2220/21
0.44
0.53
0.40
0.37
0.44
NPS is acustomer satisfaction
measure and is a key priority to help
drive stronger financial performance.
The decline in NPS score in 2024/25
is driven by EMEA and Asia Pacific
regions, as a result of the deliver-
to-promise capability being
implemented which impacted order
fulfilment scheduling temporarily.
We expect the monthly NPS
score to increase as our customer
delivery information accuracy
improves, alongside the continued
improvements in product findability.
The score in Americas region remains
consistently high, representing
industry best in class.
Building a high-performance,
engaged and motivated team
hinges on consistent, active
listening. To continuously gauge
employee satisfaction and
engagement, we introduced
pulse surveys in 2024/25. In our
most recent survey in December
2024, the engagement score
decreased by 3 points from 75 to
72. Employees voiced a desire for
more visibility from Group leaders
and more frequent communication,
which has been incorporated into
our people plan. See page 57 for
further details.
We aim to create an inclusive
and dynamic environment where
all our people can perform at
their best, develop and thrive.
We are committed to being an
equal opportunity employer and
supporting D&I within a global
context and in its broadest sense.
D&I is a focus of our people plan
and 2030 ESG action plan. We were
pleased to see the percentage
of female leaders increase by
3 percentage points to 37%
during the year. See page 58 for
further details.
Our ambition is to reach zero
accidents by 2029/30 through our
Target Zero programme, which
aims to continuously improve
performance and prevent avoidable
incidents. Progress slowed in
2024/25, with an increase in our
accident frequency rate by 19% to
0.44 (2023/24: 0.37), but we have
achieved a 36% reduction since
the 2019/20 baseline. In response,
we have enhanced our health and
safety culture through campaigns,
training, inspections, hazard
spotting and near miss reporting.
See page 60 for further details.
Link to remuneration
Performance measure in regional /
market annual incentive
Link to remuneration
Performance measure in Journey to
Greatness long term incentive plan
We report eight non-financial KPIs
that help measure progress against our
strategic actions and our commitment
to our people, culture and sustainability.
NON-FINANCIAL
KPIS
1. We updated our NPS methodology from 2022/23 to make it
more representative of our customer base. Prior years have not
been restated.
RS Group plc Annual Report and Accounts 202526
ENVIRONMENT
Carbon intensity
2,3
(tonnes of CO
2
e due to Scope 1 and
2 emissions/£m revenue)
Carbon emissions
3
(tonnes of CO
2
e due to
Scope 1 and 2 emissions)
Packaging intensity
2
(tonnes/£m revenue)
Waste
(% of waste recycled)
2.2 6,500 1.55 84%
24/2523/2422/2321/2220/21
4.0
2.4
1.9
2.4
2.2
24/2523/2422/2321/2220/21
7,800
6,200
5,600
6,800
6,500
24/2523/2422/2321/2220/21
2.39
2.10
1.73
1.61
1.55
24/2523/2422/2321/2220/21
76%
74%
76%
82%
84%
We recognise our role and
responsibilities as a global business
in addressing environmental
impacts and tackling climate
change. Our aim is to decouple
business growth from our carbon
footprint. Since 2019/20, we have
reduced our carbon intensity by
70%, including emissions from
acquired businesses in current and
prior years back to our 2019/20
baseline. Carbon intensity in
2024/25 has marginally improved,
despite the integration of emissions
from our acquisitions completed in
2023/24 and 2024/25. See page 50
for further details.
We target absolute carbon reduction
in line with our net zero action
plan, which is also a measure in our
employee annual incentive.
This year, we reduced our direct
carbon footprint by 7% from 6,800
tonnes in 2023/24, excluding recent
acquisitions, and by 4% including
recent acquisitions. This has been
driven by energy efficiency and
low-carbon technology projects,
switching to renewable electricity,
and transitioning to a net zero
fleet. See pages 50 and 51 for
further details.
Our aim is to provide the best
customer experience in the most
sustainable way. We work across
ournetwork of distribution sites to
reduce packaging, while increasing
recycled content and recyclability.
This year, performance improved by
4%, with positive progress achieved
through reusable pallets in our
internal replenishment systems,
optimising our carton sizes and
selecting more sustainable
packaging materials. Since 2019/20,
we have reduced packaging
intensity by 37%. See page 52 for
further details.
Ensuring we are able to grow
and scale the business in a
sustainable way is key. In addition
to segregating waste materials
for recycling, we implement waste
reduction and reuse initiatives
internally and work with our
suppliers. Performance improved
during the year with a 2 percentage
points improvement from 2023/24.
See page 52 for further details.
Link to remuneration
Performance measure
in annual incentive
2. Intensity metrics are on a constant exchange rate basis.
3. Scope 1 and 2 emissions have been updated to reflect improvements to our
reporting methodologies with more detail provided in our ESG basis of reporting.
Coverage includes operations under our direct financial control globally.
RS Group plc Annual Report and Accounts 2025 27GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Kate Ringrose
CFO
INVESTING FOR
THE FUTURE
WITHIN
CHALLENGING
MARKETS
Financial review
Overall results
2025
2024
restated
4
Change
Like-for-like
1
change
Revenue £2,904m £2,942m (1)% (2)%
Gross profit £1,243m £1,258m (1)% (1)%
Gross margin 42.8% 42.8% (0)pts (0.1)pts
Operating profit £233m £275m (15)% (12)%
Adjusted operating profit
1
£274m £306m (10)% (8)%
Adjusted operating profit margin
1
9.4% 10.4% (1.0)pts (0.7)pts
Adjusted operating profit conversion
1
22.1% 24.3% (2.2)pts (1.6)pts
Digital revenue
2, 3
£1,754m £1,782m (2)% (2)%
RS PRO revenue
2
£392m £386m 2% 2%
Service solutions revenue
2, 3
£738m £697m 6% 6%
1. See Note 3 (pages 154 to 158) for definitions and reconciliations of all alternative performance
measures, including like-for-like change and adjusted measures.
2. See Note 2 (pages 151 to 154) for disaggregation of revenue analysis and reconciliations.
3. Digital revenue and service solutions revenue have been restated, see Note 2 (pages 151
to 154).
4. 2023/24 has been restated in the US to reflect the correct application of the Group inventory
provisioning policy. See further details in Note 32 on pages 191 to 195.
Our strategic investment will support
ongoing market share growth and ensure
we are well-positioned to benefit when
market conditions improve.”
Revenue
£2,904m
Change: (1)%
2023/24: £2,942m
Like-for-like
1
revenue growth
(2)%
2023/24: (8)%
Operating profit
£233m
Change: (15)%
2023/24 restated
4
: £275m
Adjusted
2
operating profit
£274m
Like-for-like
1
change: (8)%
2023/24 restated
4
: £306m
Adjusted
2
operating
profit margin
9.4%
2023/24 restated
4
: 10.4%
Net debt
£364m
2023/24: £418m
RS Group plc Annual Report and Accounts 202528
Revenue
Group revenue decreased by 1% to £2,904 million.
Like-for-like revenue declined 2% after adjusting
for a £50 million contribution from acquisitions,
£66 million in adverse exchange rate movements
and a positive benefit of £28 million from more
trading days. Trading overall was stronger in the
second half with like-for-like revenue flat with
some improvements in external market indicators,
including PMI, particularly in the final quarter
in Americas and Asia Pacific, although market
uncertainty increased in the last few weeks of
the year.
Our diverse product category portfolio reduced
performance volatility as we have significant
share in categories that are more industrial and
tend to be less volatile (Facilities & Maintenance,
Mechanical & Fluid Power, PPE & Site Safety,
Other). Those correlated to the electronics
market (such as Automation & Control (A&C)
and Electrification) and the more electronics-
specific categories, Semi & Passives and Cables &
Connectors remained under pressure in 2024/25.
During the second half of the year, we benefited
from product expansion as we increased the
rate of new product introductions following the
update of our product management solution,
which allowed us to expand our technical
product offer and expand our range with our
strategic suppliers.
Digital, accounting for 60% of Group revenue,
declined by 2% on a like-for-like basis.
Digital solutions, such as eProcurement, which are
predominantly used by our larger customers and
are a key strategic goal, grew by 4%. Web revenue,
which tends to reflect smaller, more transactional
purchases, decreased by 5% on a like-for-like
basis as we move larger customers onto our
eProcurement platform and see reduced demand
from standard customers that tend to be more
transitional in nature and have higher digital costs
of acquisition.
Revenue driven by service solutions accounted
for 25% of Group revenue and increased by 6%
like-for-like, with a strong performance in digital
procurement solutions and design, technical
and custom order services. RS Integrated Supply
delivered full-year positive like-for-like revenue
growth, reflecting a strategic repositioning, new
contract wins and strong customer retention rates
in both EMEA and Americas with our order book
more than doubling during the year. We have
written off the carrying value of customer
relationships where we generate no value.
We continue to strengthen our RS Integrated
Supply proposition and operating model,
transitioning from purely contractual unit price
savings to value generation through innovative
data and technology solutions.
RS PRO, which is our main own-brand product
range, now 14% of Group revenue, grew by 2% on
a like-for-like basis, due to extending its product
breadth and end-to-end sales and marketing
focus. Our competitively priced offer continues
to gain traction as a quality, but non-competing
value alternative to third-party branded ranges,
as we demonstrate quality through our quality
assurance qualifications and design and
test facilities.
Like-
for-like
change
(2)%
24/25
revenue
Trading
day
movement
23/24 at
constant
exchange
rates
Currency
movement
23/24
revenue
Acquisitions
Like-for-like revenue development
£m
2,942
(66)
2,877
28
50
(50)
2,904
Gross margin
Gross margin was flat at 42.8%, as anticipated.
Supply-side cost inflation is normalising and
is largely being passed through, although
there has been some additional competitive
activity within the Semis & Passives product
category. We continue to focus on gross margin
optimisation through direct procurement
initiatives, commercial discipline, expanding our
own-brand ranges and by managing foreign
exchange volatility.
During the year, we conducted a detailed
assessment of our inventory as part of the
Group-wide focus on tightening working cash
discipline and cash management. Following this
review, instances of non-adherence to the Group’s
inventory provisioning policy were identified, and
in order to correct its application, we restated our
2023/24 gross profit to £1,258 million (previously
reported at £1,264 million). These prior year
adjustments do not impact 2024/25 gross profit.
For further information please refer to Note 32 on
pages 191 to 195.
Operating costs
Operating costs, including regional and central
costs, increased 3%. Adjusted operating costs,
which excludes the impact of acquisitions,
currency movements, amortisation and
impairment of acquired intangibles and
acquisition-related items, increased 1% on a
like-for-like basis. Cost-management actions
have helped to offset inflation, specifically within
labour, ongoing strategic investment, integration
costs and the restructuring charges relating to
our cost-savings programme. Higher average
order frequency has increased variable costs
and, in particular, freight costs as a percentage of
our revenue.
We delivered £19 million of restructuring benefits
by improving our productivity and removing
labour and facility duplication within the Group
and a further £10 million of structural integration
cost savings. There was a £17 million in-year
charge to deliver these restructuring and
integration benefits which is included within
our operating costs. Over the last two years we
delivered £38 million of ongoing structural cost
savings, above our original expectations of over
£30 million.
During the year, we also delivered £13m of
one-off benefit which includes £5m from the
early exit of a distribution centre lease in the
Netherlands operated by Distrelec and then
in-year savings relating to management actions
such as vacancy freezes and extending the life
of our technology hardware.
A large proportion of our operating costs relate
to our people. We awarded a low-single digit
pay increase across the Group and returned
to more normalised employee performance
incentive awards. As sales volumes have reduced,
we have flexed our variable people costs and
taken additional actions in specific areas, such as
removing duplicate roles as a result of our new
operating model and to improve productivity.
Share of
Group revenue
Like-for-like
1
revenue growth
A&C and Electrification, Test & Measurement 48% (2)%
Facilities & Maintenance, Mechanical & Fluid Power, PPE & Site Safety, Other 35% 3%
Semis & Passives (including Single Board Computing), Cables & Connectors 17% (8)%
Total 100%
(2)%
1. Like-for-like revenue is adjusted for currency, trading days and to exclude the impact of acquisitions.
RS Group plc Annual Report and Accounts 2025 29GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Financial review continued
We spent £31 million on organic strategic
investment (a £7 million increase year-on-year
but lower than anticipated at the beginning of
the year as we actively managed investment
levels in a difficult trading environment) focused
on strengthening our digital and commercial
capabilities, technology platform, product and
service solutions capacity and improving our
operating basics. This will support ongoing
market share growth and ensure we are
well-positioned to benefit when market conditions
improve. We are monitoring our investment
spend closely and implementing greater oversight
around execution, progress and delivery.
As previously reported, our central costs now
relate solely to supporting Group head office
activities with all other costs within the Group’s
operating segments allocated to the regions.
Central costs, under the new definition, increased
by £3 million to £14 million, largely reflecting the
normalisation of annual incentive and share-
based payments. Details on the reallocation are
set out in Note 2 on pages 151 to 154.
Operating costs as a percentage of revenue
increased by 1.4 percentage points to 34.8% and
on an adjusted basis increased by 1.0 percentage
points to 33.4%. Adjusted operating profit
conversion is like-for-like 1.6 percentage points
lower at 22.1% reflecting the ongoing organic
investment and cost of the restructuring and
integration programmes, with cost reductions
broadly offsetting input cost inflation and
normalisation of incentives. Operating profit
conversion is 3.1 percentage points lower at
18.7%, impacted by impairment in RS Integrated
Supply and other adjusting items.
Like-
for-like
change
(10)%
24/25
adjusted
operating
proﬁt
23/24 at
constant
exchange
rates
Currency
movement
23/24
adjusted
operating
proﬁt
Acquisitions
Like-for-like adjusted operating proﬁt movement
£m
306
(11)
295
2
(23)
274
Items excluded from adjusted profit
To improve the comparability of information
between reporting periods, we exclude certain
items from adjusted profit measures. The items
excluded are described below (see Note
11 on pages 154 to 158 for definitions and
reconciliations of adjusted measures).
Amortisation and impairment of
acquiredintangibles
Amortisation and impairment of acquired
intangibles was £37 million (2023/24 amortisation
of acquired intangibles: £27 million) and relates
to the intangible assets arising from acquisitions.
During the year, customer contracts, relationships
and distribution agreements at RS Integrated
Supply (previously IESA) were assessed for
impairment and, given we are not generating a
profit in respect of the customer relationships
acquired with the EMEA business, we have written
off the carrying value in full. As a result of that
review, assets related to the acquisition of IESA
were fully impaired, with a net book value of
£11 million.
Acquisition-related items
Acquisition-related items were £4 million, with
£2 million related to legal fees in connection
with the acquisition of Synovos and £2 million
associated with agreements reached at the time
of acquisition for retention payments to former
owners and key employees of those businesses
(2023/24: £5 million directly attributable to the
acquisition of Distrelec).
Operating profit
Operating profit decreased by 15% to
£233 million. Adjusted operating profit, which
excludes the impact of acquisitions and adverse
impact of currency movements, saw a like-for-like
decrease of 8%. Operating profit margin declined
by 1.3 percentage points to 8.0% and on an
adjusted basis declined by 0.7 percentage points
on a like-for-like basis to 9.4%.
Net finance costs
Net finance costs were £27 million, down from
£32 million in 2023/24 mainly due to the full year
impact of reduced net debt. At 31 March 2025,
34% of the Group’s gross borrowings excluding
lease liabilities (2023/24: 26%) was at fixed rates,
with surplus cash deposited at variable rates.
Profit before tax
Profit before tax declined 15% to £206 million.
Adjusted profit before tax was down 10% to
£248 million, down 7% on a like-for-like basis.
24/25
adjusted
proﬁt
before tax
Acquisition
-related
items
Amortisation
and impairment
of acquired
intangibles
24/25
proﬁt
before
tax
Adjusted proﬁt before tax reconciliation
£m
206
37
4
248
Summary cash flow
£m 2025
2024
Restated
1
Operating profit 233 275
Add back depreciation and amortisation 85 84
EBITDA 318 359
Add back impairments and loss on disposal of non-current assets 13 6
Movement in working capital 18 (64)
Defined benefit retirement contributions in excess of charge (11) (10)
Movement in provisions – 1
Other 11 9
Cash generated from operations 349 301
Net capital expenditure (49) (52)
Operating cash flow 300 249
Add back cash effect of adjustments
2
4 6
Adjusted
2
operating cash flow 304 255
Net interest paid (29) (31)
Income tax paid (60) (73)
Adjusted
2
free cash flow 214 151
1. For details of the prior year restatement see Note 32 on pages 191 to 195.
2. Adjusted excludes the cash impact of substantial reorganisation costs and acquisition-related items.
RS Group plc Annual Report and Accounts 202530
Taxation
The Group’s income tax charge was £54 million
(2023/24: £64 million). The adjusted income tax
charge, which excludes the impact of tax relief on
items excluded from adjusted profit before tax,
was £64 million (2023/24: £72 million), resulting
in an effective tax rate of 25.8% on adjusted profit
before tax (2023/24: 26.2%). Going forward we
expect the full year 2025/26 effective tax rate on
adjusted profit before tax to be c. 26.0%.
Earnings per share
Earnings per share declined by 14% to 32.5p.
Adjusting for items excluded from adjusted profit
and associated income tax effects, adjusted
earnings per share of 39.1p declined 6% on a
like-for-like basis.
Cash flow
Adjusted operating cash flow conversion improved
to 111%, significantly exceeding our target rate of
over 80%. Cash generated from operations was
£349 million (2023/24: £301 million). A £63 million
improvement in adjusted free cash flow benefited
from actively managed working capital including
a c. £20 million one-off reduction in receivables
in EMEA and focused capital expenditure, which
mitigated lower EBITDA (earnings before interest,
tax, depreciation and amortisation).
Net capital expenditure was £49 million as we
continued to invest in optimising our distribution
network, launching a new product management
solution, augmenting digital commerce
capabilities and strengthening our technology
platforms. As a result, capital expenditure was
at 1.2 times depreciation (2023/24: 1.3 times),
in line with our typical maintenance capital
expenditure levels of 1.0 – 1.5 times depreciation.
We anticipate capital expenditure in 2025/26 to be
c. £50 million including strategic investments in
our warehouse management systems, additional
distribution capabilities in Italy and Ireland and
other system upgrades.
Net interest paid decreased by £2 million to
£29 million due to a reduction in net debt
resulting from strong operating cash generation
due to the improvement in working capital and
lease disposals as part of Distrelec integration.
Adjusted free cash flow increased to £214 million.
Whilst some one-off cash benefits are expected
not to repeat, we remain committed to conserving
cash whilst ensuring we continue to invest in
our business to enable a swift recovery when
economic conditions improve.
Intangible assets
Intangible assets have decreased from
£983 million at March 2024 to £899 million (see
Note 14 on page 159), with translation differences
driving £60 million of the decrease. Goodwill of
£6 million was recognised on the acquisition of
Trident, there were additions of £33 million and an
amortisation charge and impairment cost for the
year totalling £64 million. Of the impairment cost,
£11 million related to the impairment of customer
relationships and software that were part of the
acquisition of IESA (now RS Integrated Supply
EMEA), where the value in use was less than the
carrying value of the assets.
Working capital
Working capital as a percentage of revenue
improved and was 1.1 percentage points lower
year on year at 23.9%, reflecting the improvement
in working capital management.
Trade and other receivables have decreased
by £13 million to £689 million. The collection of
receivables is our greatest short-term liquidity
sensitivity, and we continue to manage our
exposure through tight credit policies, proactive
monitoring and collections.
Inventories were £617 million, decreasing
by £20 million. Our inventory turn of 2.7
times is 0.1 times higher (2023/24 2.6 times).
Inventory provisions were in line with 2023/24
(restated – see Note 32 on pages 191 to 195 for
further details) at £87 million, representing a
slight increase in the overall provision rate from
12.0% to 12.3%.
Overall trade and other payables increased by
£8 million to £611 million from £603 million in
2023/24.
Summary balance sheet
31 March 2025 31 March 2024 (Restated
1
)
£m Assets Liabilities Net assets Assets Liabilities Net assets
Intangible assets 899 – 899 983 – 983
Property, plant and equipment 177 – 177 181 – 181
Right-of-use assets 54 – 54 73 – 73
Investment in joint venture 1 – 1 1 – 1
Other non-current assets and
liabilities
16 (102) (86) 18 (120) (102)
Current assets and liabilities 1,324 (636) 688 1,364 (637) 728
Capital employed 2,470 (738) 1,733 2,620 (757) 1,863
Retirement benefit net assets/
(obligations)
2 (16) (14) 2 (27) (26)
Net cash/(debt) (including
leaseliabilities)
148 (512) (364) 259 (677) (418)
Assets/(liabilities) 2,620 (1,266) 1,354 2,880 (1,461) 1,419
1. For details of the prior year restatement see Note 32 on pages 191 to 195.
Net debt analysis
£m 2025 2024
Borrowings (414) (440)
Bank overdrafts (42) (163)
Lease liabilities (57) (74)
Gross borrowings (512) (677)
Cash and short-term deposits 148 259
Net debt (364) (418)
RS Group plc Annual Report and Accounts 2025 31GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Financial review continued
Retirement benefit obligations
31 March 2025 31 March 2024
£m UK Other Total UK Other Total
Fair value of scheme assets 400 33 433 421 31 452
Defined benefit obligations (342) (26) (368) (385) (26) (411)
Effect of asset ceiling/onerousliability (63) (5) (68) (52) (4) (56)
Status of funded schemes (5) 2 (3) (16) 2 (15)
Unfunded schemes – (11) (11) – (11) (11)
Total net obligations (5) (9) (14) (16) (10) (26)
The £400 million multi-currency revolving facility,
the €150 million term loan and the private
placement loan notes form our committed debt
facilities of £679 million, down from £685 million
last year due to the impact of exchange rates,
of which £287 million was undrawn at 31 March
2025 (2023/24: £245 million undrawn). In October
2024, our request to take up a one-year term
extension to the multi-currency revolving facility
was approved by the lenders and so this facility
now matures in October 2029. We have also
extended the €150 million term loan end date
from April 2026 to October 2028.
The Group’s financial metrics, as set out in the
Alternative Performance Measures in Note 3
on pages 154 to 158, remain strong, with net
debt to adjusted EBITDA of 1.1x and EBITA to
interest of 10.9x, leaving significant headroom
for the Group’s banking covenants of net debt to
adjusted EBITDA less than 3.25 times and EBITA to
interest greater than 3 times.
Looking forward we continue to manage our
working capital position actively and optimising
cash conversion is a key area of focus. We remain
focused on receivables collection. We will continue
to seek to manage our inventory levels to take
account of changing demand dynamics and
supply chain behaviour, whilst anticipating our
customers’ expectations. We will continue to
invest in the right inventory to ensure that we
remain well positioned to maintain service levels
and deliver strong growth as the markets recover.
We pay our suppliers to terms and continue to
work with some of our larger suppliers to improve
terms where possible.
Net debt
Our net debt has decreased to £364 million
from £418 million (see Note 22 on pages 178
and 179). This was due to a reduction in lease
liabilities following the disposal of the
Distrelec DC lease and partial repayment
of the multi-currency revolving facility as we
generated strong operating cash flow.
Net new
leases and
employee
shares
24/25
net debt
Adjusted
free cash
ﬂow
DividendsAcquisitions23/24
net debt
Cash
impact of
adjusted
items
Movement in net debt
£m
(418)
(11)
(105)
214
(4)
(40)
(364)
Return on Capital Employed (ROCE)
ROCE is the adjusted operating profit for the
12 months ended 31 March 2025 expressed
as a percentage of the monthly average capital
employed (net assets excluding net debt and
retirement benefit obligations). ROCE was 15.2%
compared to 17.1% last year. The decrease is
predominantly driven by decline in adjusted
operating profit (1.9 percentage points).
The negative impact of recent acquisitions (0.8
percentage points) was fully offset by a lower level
of capital employed.
Retirement benefit obligations
Overall, the retirement benefit net obligations
of the Group’s defined benefit schemes at
31 March 2025 were £14 million, compared to
£26 million at 31 March 2024, due mainly to the
additional annual £11 million deficit contributions
in respect of the previous triennial valuation.
The UK defined benefit scheme (our largest
scheme) had a net obligation of £5 million under
International Accounting Standard 19 ‘Employee
Benefits’, reflecting the present value of the future
deficit contributions agreed following the March
2022 triennial funding valuation and payable to
September 2025.
Dividend
The Board intends to continue to pursue a
progressive dividend policy whilst remaining
committed to a healthy dividend cover over
time by driving improved results and stronger
cash flow. The Board proposes a final dividend
at 13.9p per share. This will be paid on 25 July
2025 to shareholders on the register on 13 June
2025. As a result, the total proposed dividend for
2024/25 will be 22.4p per share, representing
an increase of 2% over the 2023/24 full-year
dividend. Adjusted earnings dividend cover for
2024/25 is 1.7 times.
Foreign exchange risk
The Group does not hedge translation
exposure on the income statements of overseas
subsidiaries. Based on the mix of non-sterling
denominated revenue and adjusted operating
profit, a one cent movement in the euro would
impact annual adjusted profit before tax by
£1.7 million and a one cent movement in the US
dollar would impact annual adjusted profit before
tax by £0.5 million.
During the year, there were foreign exchange
losses arising on translation of £84 million,
recognised within Other Comprehensive Income,
of which £60 million related to the translation of
intangible assets as set out in Note 14 on page
159. These losses were then offset by £7 million
gains on net investment hedges.
The Group is also exposed to foreign currency
transactional risk because most operating
companies have some level of payables in
currencies other than their functional currency.
Some operating companies also have receivables
in currencies other than their functional currency.
Group Treasury maintains three to seven months
hedging against freely tradable currencies to
smooth the impact of fluctuations in currency.
The Group’s largest exposures relate to euros and
US dollars.
RS Group plc Annual Report and Accounts 202532
Regional review: EMEA
Like-for-like revenue declined 3% reflecting
decreases in industrial production output and
ongoing economic weakness across the region.
Throughout the year, PMI in the Eurozone has
been below 50 signalling continued contraction in
the manufacturing sector.
The performance in UK and Ireland (38% of
the region’s revenue) was in line with the EMEA
average. Production output has been in decline
throughout the year and UK PMI was below
50 across the second half, weakening from
the start of November in line with declining
business confidence. We have seen stability in the
number of our larger customer accounts and an
increase in average order value, however, there
has been reduction in the number of smaller
transactional customers.
France (19% of the region’s revenue) continued
to outperform the region with like-for-like
revenue growing by low single digit percentage
despite weak business confidence and industrial
production. Our more focused MRO product and
sales offer, aligned to specific industry verticals,
70
%
of total segment
operating
profit
61
%
of Group
revenue
initiated in France and in the process of being
rolled out across all three regions, is resulting
in stronger relationships with our suppliers,
improved product range curation and a focus by
our teams on the more resilient industry verticals.
DACH (Germany, Austria and Switzerland, 15%
of the region’s revenue) has been impacted
by weakness in the German economy
and particularly within original equipment
manufacturers. Throughout the year production
volumes have been in decline and industrial
production has been one of the weakest in
Europe. In Germany, we have a higher exposure
to the manufacturing sector and the automotive
industry where production volumes have been
weak with extended shutdowns and site closures.
Additionally, there is a higher participation from
A&C and Electrification, and Semis & Passives
product categories.
During the second half of the year, we increased
the rate of new product introductions significantly
following the update of our product management
solution and associated technology estate.
This has allowed us to accelerate progress in
our strategy to have a more technical product
offer and expand our range with our strategic
suppliers. This has supported growth in our
more resilient product categories of Facilities
& Maintenance, Mechanical & Fluid Power, and
PPE & Site Safety, which delivered small like-for-
like growth. A&C and Electrification products,
with demand correlated to the weaker industry
sectors and the electronics market, declined by
mid-single digit percentage, but data from our
suppliers indicates that we are still outperforming
distribution peers. Demand for Semis & Passives
remains weak with high levels of stock in the
distribution network keeping prices suppressed.
We are making significant progress with our
customer strategy focusing on high lifetime value
customers. Our corporate customer revenue grew,
benefiting from several account wins with many
using our eProcurement and Purchasing Manager
solutions which grew by 4%. These solutions are
integrated within our customers’ systems, pulling
through product purchases and generating
customer loyalty and recurring revenue.
Web revenue has been impacted by reduced
demand from more transactional customers.
RS Integrated Supply delivered strong revenue
growth, driven by higher client pass-through
spend, new contract wins and rigorous review
of customer contractual terms driving gross
margin improvements. We have written off the
carrying value of customer relationships where
we generate little value. We have continued to
invest in our multi-year programme to optimise
customer engagement and experience, simplify
our operations to maximise efficiency and
support our growth ambitions, whilst in parallel
implementing robust working capital strategies.
RS PRO remains strong, gaining 0.5 percentage
points of revenue share during the year.
The integration of Distrelec (acquired 30 June
2023) is continuing well with the merger of our
operations in Italy, including customer migration,
completed in February. Within the year we
delivered £10 million of integration cost savings,
with a further one-off £5 million benefit relating
to the early exit of a DC lease in the Netherlands
operated by Distrelec. Against this, we incurred
£9 million of integration costs.
EMEA’s like-for-like gross margin was flat due
to the lag effect of product cost inflation with
minimal sales price inflation and some pricing
activity across Semis & Passives.
Operating costs marginally increased on a
like-for-like basis. Headcount reductions and
cutbacks in discretionary spend have helped
to offset labour cost inflation and ongoing
investments in our strategic portfolio and
the expenditure relating to our cost-savings
programme. This is despite increased order
frequency adversely impacting variable costs
and, in particular, freight costs relative to sales.
Operating profit margin fell by 0.9 percentage
points like-for-like to 11.3%.
EMEA’s rolling 12-month NPS was 48.5, down from
50.9 in 2023/24. The decline was anticipated and
reflects the implementation of our new product
tracking system which had a temporary and small
impact on order fulfilment scheduling. We expect
the monthly NPS score to increase once Release 2
of our product tracking is rolled out which makes
availability and delivery information much more
accurate and visible to the customer.
EMEA
PERFORMANCE
Overall results
2024/25 2023/24 Change Like-for-like
1
change
Revenue £1,777m £1,795m (1)% (3)%
Operating profit
2
£201m £223m (10)% (9)%
Operating profit margin
2
11.3% 12.4% (1.1) pts (0.9) pts
Digital revenue
3, 4
£1,330m £1,341m (1)% (2)%
Service solutions revenue
3
£557m £532m 5% 4%
RS PRO revenue
3
£352m £346m 2% 2%
1. Like-for-like adjusted for currency and to exclude the impact of acquisitions; revenue also adjusted for trading days.
2. See Note 2 on pages 151 to 154 for reconciliation to Group operating profit. Regional operating profit has been restated in the prior
period as shown in Note 2 on pages 151 to 154.
3. See Note 2 for disaggregation of revenue analysis and reconciliations to region’s revenue.
4. Digital revenue has been restated, see Note 2 on pages 151 to 154.
Highlights
75
%
of revenue
from digital
20
%
of revenue
from RS PRO
31
%
of revenue from
service solutions
48.5
NPS
RS Group plc Annual Report and Accounts 2025 33GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Regional review: Americas
AMERICAS
PERFORMANCE
Americas revenue declined 3%, with like-for-like
revenue, adjusted for currency and trading days,
being flat.
Economic weakness in the US and Canada
markets (71% of region’s revenue) and broader
uncertainty has impacted business confidence as
reflected in PMI data. This improved in the fourth
quarter, with like-for-like revenue turning positive,
in part reflecting expectations of improving
business outlook.
Our operations in Latin America (23% of region’s
revenue) have grown strongly, helped by a market
continuing to benefit from increased capital
investment in private and public sectors (mining,
chemical, personal care, pharma and energy) and
our proposition resonating well with our existing
customer base as we expand our product and
service offer.
Our business in Americas has a higher proportion
of builders of industrial assets, including discrete
manufacturers, within the customer base than
the rest of the Group. This results in greater
sensitivity to capital investment expenditure
and project-related sales and so was affected by
the reduction in manufacturing production and
market uncertainty for much of the year. Our key
growth accelerators (product expansion, RS
PRO, solutions, strategic suppliers and targeting
specific customer vertical) outperformed as we
implement our strategic action plan.
A large proportion of revenue relates to industrial
A&C and Electrification products (c. 70% of the
region’s revenue versus 41% across the Group)
which delivered a low single digit percentage
like-for-like growth. Semis & Passives and Cables
and Connectors (c. 10% of the region’s revenue)
saw high single digit like-for-like decline.
Overall results
2025
2024
restated
2
Change Like-for-like
1
change
Revenue £907m £934m (3)% 0%
Operating profit
2
£82m £89m (9)% (4)%
Operating profit margin
2
9.0% 9.6% (0.6)pts (0.5)pts
Digital revenue
3, 4
£305m £318m (4)% (3)%
Service solutions revenue
3,4
£134m £122m 10% 12%
RS PRO revenue
3
£7m £7m 6% 8%
1. Like-for-like adjusted for currency and to exclude the impact of acquisitions; revenue also adjusted for trading days.
2. See Note 2 on pages 151 to 154 for reconciliation to Group operating profit. Regional operating profit has been restated in the prior
period as shown in Note 2 on pages 151 to 154 and Note 32 on pages 191 to 195.
3. See Note 2 on pages 151 to 154 for disaggregation of revenue analysis and reconciliations to region’s revenue.
4. Digital revenue and service solutions revenue have been restated, see Note 2 on pages 151 to 154.
Revenue from digital declined by 3%
like-for-like. Our eProcurement solution
outperformed, particularly in Latin America, as we
migrated larger customers onto the technology,
driving increased customer loyalty. We look
forward to continued momentum in 2025/26
with the roll out of our new digital platform in
US and Canada and further development of our
eProcurement solution.
Revenue attributed to service solutions grew
12% like-for-like, driven by our investment and
sales team focus in ramping up our design and
technical services and delivery offers.
RS PRO revenue increased, from a low base, as
we increased management focus and marketing
effort on some key product categories. In Latin
America, we are beginning to introduce RS PRO to
our customers with curated product offerings and
increased promotional activities.
RS Integrated Supply delivered flat like-for-
like revenue growth, despite a small reduction
in customer pass-through spend, reflecting
the blend of new contract wins and customer
retention rates. We continue to drive efficiency
in our operating costs delivering in-year savings
as we move to a global platform and operating
model, sharing best practice.
Americas’ gross margin was slightly lower (0.1
percentage points on a like-for-like basis) due
to some competitive pricing pressure, largely
offset by focused margin-improvement activities
and expansion into margin accretive product
lines. During the year, we conducted a detailed
assessment of our inventory as part of the Group-
wide focus on tightening working cash discipline
and cash management.
Following this review, it was identified that some
inventory was miscategorised against which
more stringent provision rates should have been
applied, along with further instances of non-
adherence of the Group policy. As a result, we
increased the inventory provision by £19 million.
We restated our 2023/24 gross profit to
£89.2 million (previously reported at £95 million).
These prior year adjustments do not impact
2024/25 gross profit. For further information
please refer to Note 32 on pages 191 to 195.
Our operating costs are up 2% like-for-like
reflecting investments in initiatives focused on
customer experience, service-based solutions
and product offer expansion offset by structural
cost reductions and efficiencies to better align
the region with current demand. A portion of
the investments was related to expansion and
process investments in Latin Americas to support
continued growth.
Americas’ operating profit margin declined
year-on-year mainly due to flat revenue coupled
with limited pricing pressures, partially offset
by favourable operating cost reductions and
discipline. Operating profit margin was 9.0%.
Americas’ rolling twelve-month NPS was 65.2,
an increase from 64.8 in 2023/24 reflecting
steady increases to the monthly scores from
improved offerings and processes. Our high NPS
score reflects our strong customer experience
with fast response rates and high levels of
consistent service.
28
%
of total segment
operating
profit
31
%
of Group
revenue
34
%
of revenue
from digital
1
%
of revenue
from RS PRO
15
%
of revenue from
service solutions
65.2
NPS
Highlights
RS Group plc Annual Report and Accounts 202534
Regional review: Asia Pacific
ASIA PACIFIC
PERFORMANCE
Overall results
2025 2024 Change Like-for-like
1
change
Revenue £219m £214m 2% 0%
Operating profit
2
£6m £5m 22% 43%
Operating profit margin 2.8% 2.3% 0.5 pts 0.9 pts
Digital revenue
3
£118m £123m (4)% (2)%
Service solutions revenue
3
£47m £43m 8% 10%
RS PRO revenue
3
£34m £33m 2% 3%
1. Like-for-like adjusted for currency and to exclude the impact of acquisitions; revenue also adjusted for trading days.
2. See Note 2 on pages 151 to 154 for reconciliation to Group operating profit. Regional operating profit has been restated in the prior
period as shown in Note 2.
3. See Note 2 on pages 151 to 154 for disaggregation of revenue analysis and reconciliations to region’s revenue.
Asia Pacific’s revenue increased by 2%, benefiting
from the acquisition of Trident and more working
days. Like-for-like revenue was flat with improved
momentum and signs of recovery across most
markets in the second half.
Southeast Asia accounts for 32% of regional
revenue and is, for the first time, our largest
sub-region by revenue. Performance accelerated
in the second half to deliver high-single digit
revenue growth as we focused on larger
corporate customers, marketing RS PRO, a strong
reception to our eProcurement solution push and
the expansion of our network of fulfilment centres
and inventory capacity. Our services strategy
has been effective in adding value and capturing
market share, delivering strong growth. We have
expanded our product offer through enhanced
vendor management capabilities and are sourcing
more products locally to reduce freight cost.
Australia and New Zealand (35% of region’s
revenue) saw a slight like-for-like revenue decline,
reflecting the challenging economic environment
with large corporate customers’ performance
most impacted. Macroeconomic indicators
including PMI showed improvement in the fourth
quarter, with revenue performance strengthening.
The acquisition of Trident in Perth, Australia, in
April 2024, expands our service capability, local
fulfilment centre capacity and opens opportunities
with customers in the resources sector, which
delivered strong growth.
Greater China’s (22% of the region’s revenue)
performance strengthened as the market showed
signs of recovery despite a higher exposure to the
electronics markets and intensified US sanctions;
like-for-like revenue growth was flat. China ended
the year in growth which our improved industrial
offer, high lifetime value customer-focus and RS
PRO traction, which offset the significant loss of
electronics business as an impact of the sanctions
placed on Chinese customers.
54
%
of revenue
from digital
15
%
of revenue
from RS PRO
21
%
of revenue from
service solutions
19.0
NPS
8
%
of Group
revenue
2
%
of total segment
operating
profit
Suppressed market demand has continued to
impact Japan and Korea which saw like-for-like
revenue decline. Positively, RS PRO and our
eProcurement solution both performed well.
Digital like-for-like revenue declined mainly
impacted by web performance, particularly in
Greater China, Japan and Korea, due to local
digital infrastructure challenges and weaker
electronics’ market demand. However, our
eProcurement performance grew by high single-
digit percentage.
RS PRO like-for-like revenue outperformed
the region, supported by an enhanced go-to-
market strategy, including targeted product
marketing campaigns and focused product
range catalogues.
Our gross margin improved by 0.5
percentage points like-for-like, due to effective
cashflow hedging processes and lower
inventory provisions.
Operating costs were flat like-for-like, benefiting
from restructuring initiatives in adjusting our
cost base in the prior year, partially offset by
the continued investment in growth initiatives
focusing on customer experience, digital
marketing campaigns and local fulfilment capacity.
The operating profit margin increased by
0.9 percentage points on a like-for-like basis,
reflecting favourable gross margin drop through
and operational cost efficiencies we delivered to
improve the region’s profit conversion.
Asia Pacific’s rolling 12 months’ NPS score
declined 2.8 points to 19.0 compared with
2023/24. As with EMEA, the decline was
anticipated and reflects the implementation of
our new product tracking system which had a
temporary and small impact on order fulfilment
scheduling. We expect the monthly NPS score to
increase once Release 2 of our product tracking
is rolled out, which makes availability and delivery
information much more accurate and visible to
the customer.
Highlights
RS Group plc Annual Report and Accounts 2025 35GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Risks, viability and going concern
We use risk management and
internal control processes to identify,
assess, manage and monitor the
risks which have the potential
to affect the achievement of
our strategy.
Risk governance
The Board has overall accountability for the
Group’s risk management, which is delegated
to the ExCo and supported by the Group’s risk
team. The Board and ExCo are committed to
setting and embedding a sound risk culture which
is aligned with the principles and values of the
Group. They recognise that the right risk culture
is vital in assisting management and employees
in the avoidance of many potential organisational
difficulties. They aim to set the correct tone from
the top and ensure that risk is an intrinsic element
of the governance structure.
Risk appetite
We define our risk appetite as the amount of
risk that the Group is willing to take to meet its
strategic objectives and deliver projected returns.
The Board has the responsibility of assigning a
risk appetite against each of the risk themes and
agreeing behaviours that align to each of the
appetite categories. The appetite is underpinned
by key factors such as our ways of working,
treating customers fairly and our strategic
objectives, along with national and international
laws and regulations within the regions in
which we operate. We have a low tolerance for
regulatory risks or risks to the reputation of
the business.
Assessment of risks
The respective risk owner identifies the controls to
mitigate each risk and assesses the impact (using
both financial and non-financial criteria) and
likelihood of the risk occurring (using consistent
measures). These assessments consider the
effects of the existing controls leading to the
resulting net or residual risk.
This assessment process is supplemented by an
annual risk and controls questionnaire which is
completed by all relevant operating locations and
Group-wide functions. This provides more detailed
and operational risk information across the Group
and is reviewed by the Group’s risk team.
Emerging risks
Some risks cannot be easily quantified, often
due to a lack of information to facilitate a clear
understanding of the consequences. These risks
are categorised as emerging, and they are
monitored until more information is available.
RS does not tolerate fraud or other financial
crimes in any aspect of its operations and any
suspected acts are fully investigated and the
individual(s) involved prosecuted if appropriate.
See pages 66 and 76 for more information
regarding our Code of Conduct and policies.
Risk framework
Risk management is an essential part of business
activities, to assist identifying the problems the
Group may face and to help avoid or manage
them where necessary. Effective risk management
empowers management and the organisation
to act with autonomy and accountability and
supports the Group to use risk information as a
guide to making informed decisions and to help
prioritise resources.
The risk framework is designed to identify, assess
and mitigate potential risks proactively, ensure
regulatory compliance, enhance operational
efficiency and foster stakeholder confidence. It is
a strategic asset for safeguarding the Group’s
financial health, managing our reputation, and
ensuring targets are achieved. The members
of the ExCo are responsible for the operational
day-to-day understanding and adherence to the
risk framework and are also tasked with creating
a positive risk culture and embedding key risks for
discussion within their quarterly business reviews.
Senior managers are responsible for producing
risk registers for their areas of the business and
being transparent in providing information to the
risk team. This process involves market, business
and functional leaders providing bottom-up
visibility of possible risks.
HOW WE MANAGE
OUR RISKS EFFECTIVELY
OUR RISK MANAGEMENT
PROCESS
1.
2.
3.
4.
Determine and treat the risk
Identify potential risks
Monitor
and review
Assess
the risk
RS Group plc Annual Report and Accounts 202536
Accountable and responsible teams
OVERALL ACCOUNTABILITY
Board
Overall accountability for the Group’s approach to risk management. Supported by the Audit
Committee to ensure effective internal controls and risk management systems, the Board also
approves the Group’s risk appetite and the principal risks.
RISK OWNERS
Executive Committee
Responsible for owning and reviewing the
Group’s risk management process, principal
and executive risks, mitigating internal controls
and making recommendations to the Board.
Markets, regions and Group functions
Identifying, reviewing and communicating local
risks using risk registers, where applicable.
SUPPORTING TEAMS
Group risk
Supports the business to identify, assess,
manage, and report risks. This includes
providing a consistent measurement process
for risks and helping identify risks that should
be reported at a Group level.
Other specialist functions
Other functions complementing the Group risk
team that oversee areas including information
security and technology, legal, compliance and
environmental and health and safety teams.
ASSURANCE
Internal audit
Internal audit, as part of its scheduled audits, reviews the effectiveness of the
Group’s mitigating controls.
RS Group plc Annual Report and Accounts 2025 37GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Risks, viability and going concern continued
Risk owner: Group Chief Information Officer
Strategic pillar: Operational excellence
What is the risk and how could it affect us?
A successful attack on our systems, sites, data or a third party could mean that confidential
information is lost or business critical systems become unavailable. This may lead to negative
customer or supplier impacts, regulatory action, reputational damage, reduced liquidity, and/or
loss of business and revenue.
What are we doing to manage the risk?
– Controls in place include technical and structural protection measures including:
– Firewalls
– Anti-malware software
– Staff training and awareness
– Procedures to update security patches
– Regular security testing
– Incident response processes
– Regular assessment and continuous development of security controls, including investing
in employee education and awareness and further security testing capabilities. This includes
running simulations of security incidents with both senior and operational leaders
What are our future areas of focus?
– Continuing to stay abreast of developments relating to cyber security, including regulatory
changes such as The Network and Information Security (NIS2) Directive
– Working collaboratively with the National Cyber Security Centre and other third-party security
intelligence organisations
– Strengthening the culture of scenario testing and rehearsals to ensure that organisational
preparation is at the highest possible standard
CYBER SECURITY
Risk theme: Operational
OUR PRINCIPAL RISKS
AND UNCERTAINTIES
Principal risks
The Board and ExCo confirm that they have
undertaken a robust assessment of the Group’s
principal and emerging risks, including those
that could threaten our business model, future
performance, solvency or liquidity, and reputation
and have assessed them against the Group’s
risk appetite.
Every principal risk is owned by at least one
ExCo member, and the principal risks and their
mitigations are discussed regularly at ExCo and
presented to the Board. This allows the Board to
review and determine whether the actions being
taken by management are sufficient.
Removed principal risks
Access to debt and capital markets has been
removed as a principal risk but continues to be
closely monitored by the ExCo and Group risk.
The Group is cash generative, has relatively
low gearing and capital headroom. It has been
removed in agreement with the Group Treasurer
and ExCo.
Risk direction definition
The risk is likely to increase
within the next 12 months
The risk is likely to remain
stable within the next 12 months
The risk is likely to reduce
within the next 12 months
RS Group plc Annual Report and Accounts 202538
Risk direction definition
The risk is likely to increase within the next 12 months
The risk is likely to remain stable within the next 12 months The risk is likely to reduce within the next 12 months
Risk owner: Chief of Product and Supply Chain / President EMEA / President Americas /
President Asia Pacific
Strategic pillar: Operational excellence
What is the risk and how could it affect us?
Increasing global destabilisation and macroeconomic uncertainties impact our international
business activities, increasing operating costs, additional trade sanctions, tariffs, supply chain
delays, and/or hinders the passage of products between our distribution sites with delays and
higher costs.
What are we doing to manage the risk?
– Continuously monitoring the existing markets in which the Group operates to identify
potential uncertainties that may impact our service within countries, regions or globally
– Through our supplier (direct and indirect) relationships, identifying potential supply
vulnerabilities and ensuring appropriate resilience is in place
– Continued investments in trade compliance intelligence and capabilities
– Continued expansion of the breadth of our product range in both depth and breadth,
reducing dependency on any specific supplier or sourcing market
– Considering this risk as part of the due diligence process when looking at potential
acquisition targets
What are our future areas of focus?
– Increasing share of local and nearshore sourcing, reducing singular risk from one
sourcing market
GEOPOLITICAL AND MACROECONOMIC ENVIRONMENT
Risk theme: Operational
Risk owner: Chief of Corporate Services and Company Secretary
Strategic pillar: Operational excellence
What is the risk and how could it affect us?
We fail to manage legal and regulatory compliance risks which could lead to:
– Serious health and safety incidents/breaches
– Non-compliance with trade, transport, or product regulations across different markets
– Breaches of other regulatory or legislative requirements (such as the UK Bribery Act 2010, the
Criminal Finances Act 2017, the Economic Crime and Corporate Transparency Act 2023 and
the upcoming guidance and offence of Failure to Prevent Fraud)
– Non-conformance with operational compliance, AI policies (creating risks of intellectual
property infringement, exposure of confidential information and system vulnerabilities)
What are we doing to manage the risk?
– Health and safety: accident and near miss reporting, reduction strategies and actions provided
by specialist support
– Ongoing reviews of relevant national and international compliance requirements
– Training and awareness programmes focusing on legal regulations and requirements
– Code of Conduct for all employees and whistleblowing facilities to raise concerns
– Ethical sourcing policy for suppliers
– Our trade compliance systems scanning customer orders to ensure trade compliance
requirements are being followed
– AI policy framework, backed up with systemic controls and processes, to control the use of
public generative AI tools
– Training to ensure AI literacy is in place in relevant parts of the business
What are our future areas of focus?
– Continuing to review and monitor generative AI use across the Group, alongside awareness
campaigns to increase AI literacy
– Refreshing supply chain diligence, including Modern Slavery policy
– Ongoing focus on improving health and safety practices and processes
– Continued awareness campaign and promotion of the Group’s whistleblowing Speak Up process
– Updated fraud policy and controls to ensure reasonable procedures are in place, alongside
focused training for higher risk parts of the business
– Ongoing monitoring of AI usage through tools and triage forum
LEGAL AND REGULATORY COMPLIANCE
Risk theme: Regulatory compliance
RS Group plc Annual Report and Accounts 2025 39GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Risks, viability and going concern continued
Risk owner: Chief of Product and Supply Chain / Group Chief Information Officer
Strategic pillar: Operational excellence / experience
What is the risk and how could it affect us?
We are not adequately prepared for a major business disruption, either local or global, caused by
an unplanned event disrupting critical infrastructure (physical and/or digital assets), and cannot
carry out key processes and functions.
What are we doing to manage the risk?
– Using our global supply chain network with the ability to fulfil customer orders by another
distribution site and maintain service
– Ongoing assessments of critical third-party inventory suppliers and appropriate inventory
levels to mitigate risk, where identified
– Resilient IT systems infrastructure featuring operating redundancies and disaster recovery
– Annual disaster recovery testing of core IT systems, both digital and supply chain
– Strict control over upgrades to core transaction systems and other applications
– Defined technology major incident reporting in place and tested
What are our future areas of focus?
– Continued expansion of product ranges stocked closer to customers to reduce dependency
on individual distribution sites within the network
– Continuing to update legacy systems and test disaster recovery of existing systems
– Collating individual operational area business continuity plans for review
BUSINESS RESILIENCE
Risk theme: Operational
Risk owner: Chief Financial Officer / Group Chief Information Officer
Strategic pillar: Operational excellence / experience
What is the risk and how could it affect us?
We are not able to implement a successful business and technology change programme to
deliver the strategic agenda. This could lead to a lack of engagement and prioritisation for
deployment and embedding the required change initiatives into the business.
What are we doing to manage the risk?
– Implemented a robust strategic delivery end execution framework, including active
sponsorship and leadership by the senior leadership team supported by a defined
governance process
– A new business case and investment framework process
– A portfolio Review Forum including relevant senior leaders to review risks, financial
performance, and the change management approach
– Managing prioritisation sessions to assess projects by reference to the capacity to deliver and
the ability of the organisation to absorb change and affordability
What are our future areas of focus?
– Deploying a change management methodology and creating a community of practice
– Assessing the project and programme management capability
CHANGE INITIATIVES
Risk theme: Operational
Risk direction definition
The risk is likely to increase within the next 12 months
The risk is likely to remain stable within the next 12 months The risk is likely to reduce within the next 12 months
RS Group plc Annual Report and Accounts 202540
Risk owner: Chief People Officer
Strategic pillar: Operational excellence
What is the risk and how could it affect us?
If we are not able to attract, develop and retain the necessary high-performing employees and
capabilities, we will not be able to meet our strategic goals and maintain customer service levels
and relationships.
What are we doing to manage the risk?
– Developing a strategic workforce plan to create the right culture that delivers on our
employee vision
– Increasing focus on succession planning and action follow up
– Investing in leader and manager capability development
– Improving the cascade of objectives and performance management
– Launching Employee Value Proposition
What are our future areas of focus?
– Continuing strategic workforce planning to ensure we have the capabilities to deliver
the strategy
– Identifying core skills in the workforce and gap analysis, developing a plan to bridge the gap.
– Assessment of Early Careers programmes to determine what type of proposition is needed to
attract and retain talent for the future
– Launching the global recognition programme
TALENT AND CAPABILITY
Risk theme: Operational
Risk owner: Chief of Customer Experience / President EMEA / President Americas /
President Asia Pacific
Strategic pillar: Operational excellence / customers / products and suppliers / solutions /
experience
What is the risk and how could it affect us?
Increasing uncertainty and unexpected changes in market buying behaviours result in lower
than forecast financial results. Causes may include a lack of customer analysis, changes in macro
economic environment, e.g. tariffs and technological/AI advances.
What are we doing to manage the risk?
– Continuously assessing what is ‘value’ to our customers and the optimal ways to deliver this
at an appropriate return for the Group
– Improving our online user experience through differentiated product content to make it easier
for customers to compare and select the right product across an unrivalled product range
– Mitigating cyclicality by building increased flexibility into our cost base and targeting less
cyclical customer verticals and product categories
What are our future areas of focus?
– Continued targeted expansion of our product range in both depth and breadth to ensure
we meet our customers’ existing and future needs, including horizon-scanning on future
technologies and driving consolidation of customers’ purchases with us
– Further development of solutions providing more value to customers and enhancing
customer loyalty
– Accelerating our execution of strategic initiatives to improve our competitive position in
the market
MARKET DISRUPTION
Risk theme: Strategy and change
Risk direction definition
The risk is likely to increase within the next 12 months
The risk is likely to remain stable within the next 12 months The risk is likely to reduce within the next 12 months
RS Group plc Annual Report and Accounts 2025 41GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Risks, viability and going concern continued
Risk owner: Chief of Corporate Services and Company Secretary
Strategic pillar: Operational excellence / product and suppliers
What is the risk and how could it affect us?
We do not adequately manage the potential impacts on the business due to climate change
effects. This could be either:
– The physical risks of more extreme weather conditions (including heatwaves, storms or floods)
which could impact employee health and wellbeing, our supply chain channels and customer
service, reducing revenue and increasing operating and capital costs in order to mitigate the risks
– The transition risks associated with the migration to a low-carbon industrial sector, including
declining demand from heavy and energy intensive industries or single-use RS products
and increased costs of logistics (due to carbon taxes on fuels and investment in clean
technologies), could lead to reduced revenue or reduced customer net promotor score
What are we doing to manage the risk?
– Continuing to expand our sustainable products, including our Better World product range, to
support our customers’ climate goals
– Improving our supply chain and operational capabilities, to reduce emissions from our
distribution sites and product shipments
– Introducing five climate-related questions into the Group’s risk control questionnaire to
increase awareness and accountability at a site level, while enabling us to continue horizon
scanning and maintain oversight
– Broadening our risk management approach for both risks and opportunities to prepare
for emerging ESG regulatory compliance, including the Corporate Sustainability Reporting
Directive (CSRD) and the International Sustainability Standards Board
– Providing Board and ExCo with climate education and skills development to assist in risk mitigation
and ensure integration into strategy, business planning and decision making (see page 65)
What are our future areas of focus?
– Continuing to grow our customer offerings and revenue from sustainable products, service
solutions and low-carbon industries, optimise our supply chain and focus on business
continuity planning and building upgrades at our distribution sites most exposed to physical
climate impacts
– Addressing the impact on the Group’s carbon reduction progress due to recent acquisitions
CLIMATE CHANGE
Risk theme: Operational
Risk owner: Chief Financial Officer
Strategic pillar: Operational excellence / customers / products and suppliers / solutions /
experience
What is the risk and how could it affect us?
We do not realise the appropriate value from our acquisitions.
What are we doing to manage the risk?
– Thorough screening for fit with our agreed strategy and our culture
– Rigorous due diligence and contract negotiation processes, including full involvement
of expertise across our businesses, functions and, where appropriate, external advisors
– Clearly defined returns criteria for investments, expertise in a comprehensive suite
of valuation techniques and a commercial approach to negotiation
– Robust integration planning processes linked to the due diligence process; ownership of the
business plan and synergy targets; detailed synergy capture plan and governance of post-
acquisition delivery process
What are our future areas of focus?
– Continuing to audit and refine internal processes
– Continuing to train and develop latest industry-standard techniques for valuation, acquisition,
and integration
– Oversight to ensure investments are meeting/exceeding targets from the acquisition
business case
M&A ACTIVITY
Risk theme: Operational
Risk direction definition
The risk is likely to increase within the next 12 months
The risk is likely to remain stable within the next 12 months The risk is likely to reduce within the next 12 months
RS Group plc Annual Report and Accounts 202542
Viability statement
Assessment of prospects
Our business model and strategy, as described
on page 11, is structured so that the Group is
a digitally enabled global distributor of product
and service solutions, providing small volumes of
our suppliers’ products to satisfy our industrial
customers’ MRO demands. We supply a very
broad spread of customers both in terms of
industry sector and geography. The Group is
not reliant on one particular group of customers
or suppliers, as its customer and supplier base
continues to be diverse. Our business model
is differentiated by: our global network of
distribution sites; our customer-centric team; our
strong supplier relationships; our broad and deep
product offering and service solutions capabilities;
and our strong digital presence. The Group has
high inventory availability with products sourced
from a large number of suppliers and provides
customers with a reliable and fast service.
The Group’s results and financial position are
reviewed monthly by both our ExCo and the
Board. Every day the ExCo receives an analysis
of the previous day’s revenue and gross margin.
The Board receives and reviews regularly the
monthly management accounts, including cash
flows, and also receives regular performance and
forecast updates from the CFO and CEO.
We update our detailed rolling forecast of
the Group’s income statement, balance sheet
and cash flows frequently which are regularly
reviewed, and the assumptions approved, by
the Board.
The Group’s long-term prospects are assessed
primarily through our strategic and financial
planning process. This includes the preparation
of a five-year strategic plan and an annual
budget setting process, involving both Group
and regional management, which are updated
annually and reviewed and approved by
the Board. The ExCo receives and reviews
progress against the strategic plan objectives
regularly. The Board also receives updates and,
if appropriate, the strategic plan is updated
depending on progress and performance.
The Board also considers the long-term prospects
of the Group as part of its regular monitoring and
review of risk management and internal control
systems, as described on page 36 and pages 86
to 88.
Our regular cash flow forecasts enable us to
track our net debt position and to take any
necessary actions on a timely basis. Our capital
position is supported by regular reviews of the
Group’s funding facilities and banking covenants’
headroom, through the Group’s Treasury
Committee. In 2024/25 we agreed an extension
to our €150 million loan, which now matures in
October 2028. Our £400 million multi-currency
revolving facility now matures in November 2029.
Only £113 million of this facility was drawn down
at 31 March 2025.
As described throughout this Annual Report
and Accounts, the Group’s performance was
impacted by the challenging macroeconomic
environment over the past year and the further
unwinding of our pandemic-related trading
benefit. As a result, like-for-like revenue declined
by 2%. An improvement in working capital led
to an increase of 40% in adjusted free cash flow
to £215 million and net debt of £364 million
(including lease liabilities of £57 million) at
31 March 2025. We also paid dividends during
the year of £105 million (2023/24: £104 million).
We have ended the year with a strong
balance sheet.
Details of our sources of finance are outlined
in Note 23 on pages 179 to 183. The earliest
facilities maturing being two tranches of our
private placement loan notes in 2026/27 totalling
£76.9 million.
The Group’s debt covenants are EBITA to interest
to be greater than 3:1 and net debt to adjusted
EBITDA to be less than 3.25:1. At 31 March 2025
EBITA to interest was 10.9x (2023/24 restated:
10.3x) and net debt to adjusted EBITDA was 1.1x
(2023/24 restated: 1.2x) (see Note 3 on pages 154
to 158 for reconciliations) and under our strategic
plan these are also comfortably met.
Viability assessment period
In its assessment of the Group’s viability, the
Board has reviewed the assessment period
and has determined that a three-year period to
31 March 2028 continues to be most appropriate.
The robustness of the strategic plan is higher in
the first three years. The Group has few contracts
with either customers or suppliers extending
beyond three years and, in the main, contracts
are for one year or less. The business operates
with a minimal forward order book, generally
taking orders and shipping them on the same
day. In addition, as more business becomes digital
and we become more agile, speed of change
increases and so visibility is relatively short term.
Of the Group’s long-term obligations, the UK
pension scheme is the largest and its triennial
funding valuation forms the basis of our agreeing
its funding with its trustee. Our share-based
payment schemes are also mainly for three years.
Assessment of viability
Each of the Group’s principal risks and
uncertainties on pages 38 to 42 has a potential
impact on the Group’s viability and so the Board
considered various scenarios and examined a
number of factors that could impact each in the
future. It decided which scenarios would have
the most impact on the viability of the Group and
determined an appropriately severe, but plausible,
stress test for each of these scenarios.
The strategic plan approved at the January 2025
Board meeting is considered to reflect the Board’s
current best estimate of the future prospects
of the Group. Therefore, in order to assess the
viability of the Group, the scenarios and stress
tests were modelled by overlaying them onto the
downside version of the strategic plan to quantify
the potential impact of one or more of them
crystallising over the assessment period.
In performing the above tests it was assumed that
capital expenditure is unchanged from that in the
strategic plan, there are no cost mitigation actions
taken, dividends continue to be paid and there are
no changes in or extensions to debt financing.
The results of the above stress tests showed the
Group would be able to withstand the impact of
these scenarios occurring.
Reverse stress tests were also undertaken to
assess the circumstances that would threaten
the Group’s current financing arrangements.
These included significant declines in revenue,
significant declines in both revenue and gross
margin and a major deterioration in cash
collection and would have to result in adjusted
operating profit margin falling to under 3%
in at least one of the following three years.
Also, a reverse stress test of an acquisition of a
significantly loss-making business was undertaken
and would have to cost more than £300 million to
use up our debt facilities. All these reverse stress
tests assumed that no major reorganisations
or significant working capital initiatives occur in
mitigation, capital expenditure is unchanged from
that in the strategic plan, dividends continue to be
paid and there are no changes in or extensions
to debt financing. The Board considers the risk of
these circumstances occurring to be remote.
RS Group plc Annual Report and Accounts 2025 43GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
The above scenarios are hypothetical and
extremely severe for the purpose of creating
outcomes that have the ability to threaten the
viability of the Group; however, multiple control
measures are in place to prevent and mitigate
any such occurrences from taking place. If any
of these scenarios actually happened, various
options are available to the Group to maintain
liquidity so as to continue in operation.
Confirmation of viability
Based on the assessment outlined above, the
Board has a reasonable expectation that the
Group will be able to continue in operation and
meet its liabilities as they fall due over the three
years to 31 March 2028.
Going concern
The going concern period is defined as a period
of at least 12 months from 20 May 2025.
The same reverse stress tests were applied for
the going concern period as for the viability
modelling. These included significant declines
in revenue, significant declines in both revenue
and gross margin, a major deterioration in
cash collection, and major under-performing
acquisition. These reverse stress tests assumed
that capital expenditure and operating costs
are unchanged from those in the forecast,
no significant working capital initiatives occur
in mitigation, dividends continue to be paid
and there are no changes in or extensions to
debt financing.
Based on the assessment outline above and
the output of our detailed rolling forecasts, the
Board believes that it is appropriate to continue
to adopt the going concern basis in preparing the
Group’s accounts.
Scenario and related stress tests modelled
Revenue and gross margin down
Five percentage points decrease in growth in
each of 2025/26, 2026/27 and 2027/28 from
the downside strategic plan. Gross margin
falls by two percentage points and does not
improve. Freight and variable labour rates
continue at the same percentage of revenue.
No cost-saving initiatives are implemented.
Link to principal risk and uncertainties
– Change initiatives
– M&A activity
– Talent and capability
– Geopolitical and macroeconomic
environment
– Market disruption
– Climate change
– Legal and regulatory compliance
Significant infrastructure failure
A major incident at the distribution site with
the largest impact, destroying the building
and its contents
Link to principal risk and uncertainties
– Business resilience
– Climate change
Cash collection down
Cash collection from trade receivables
deteriorates leading to trade receivables
impaired by 2% of revenue in 2025/26
Link to principal risk and uncertainties
– Geopolitical and macroeconomic
environment
Major cyber breach/information loss
Major system failure (possibly caused by
a cyber attack) leading to a serious loss of
service, fines for data breach and loss of
reputation leading to halving of revenue
growth
Link to principal risk and uncertainties
– Cyber security
– Business resilience
Risks, viability and going concern continued
RS Group plc Annual Report and Accounts 202544
ENABLING
SUSTAINABILITY
FOR STRONGER
VALUE CREATION
IN THIS SECTION
Our 2030 ESG action plan 46
Advancing sustainability 48
Empowering our people 56
Championing youth & communities 61
Doing business responsibly 64
TCFD 68
Non-financial and sustainability
information statement 76
Section 172 statement 77
+ Read more about our ESG approach at:
rsgroup.com/sustainability
Environmental, social and governance (ESG)
RS Group plc Annual Report and Accounts 2025 45GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
SOCIAL
Our purpose, making amazing happen for
a better world, reflects our commitment
to delivering results for people, planet
and profit. To create value for all our
stakeholders, our 2030 ESG action plan
targets four global goals and 14 ambitions
where we are driving positive change
related to our most material ESG areas.
We are accelerating our 2030 ESG action
plan to support our c. 1 million customers,
c. 8,500 people and over 2,500 global suppliers.
By targeting the Group’s most material ESG
actions, as identified through our updated double
materiality assessment (DMA), we are enabling
our strategy, strengthening relationships and
generating more value for our stakeholders.
The outputs of our 2024/25 DMA are mapped to
the right under the relevant action plan areas with
a symbol to reference their type of materiality.
+ Read more about our approach in our ESG Report:
rsgroup.com/sustainability
In the process of updating our DMA we have
reassessed the impacts and opportunities related
to our people and communities and their level of
materiality. As a result, we have re-ordered our
ESG action plan goals to bring the Empowering
our people goal forward and refocused the
Championing education and innovation goal
around Championing youth & communities.
We have also streamlined our DMA results to
clarify our most material topics. These changes
align more closely with our strategy and initiatives,
stakeholder focus and materiality assessment.
D
D
I
I
I
I
I
I
I
I
F
F
Climate change p.49
Customer and supplier partnerships p.11 to p.13
Energy p.51
Health and safety p.60
Culture and
engagement p.57
Diversity
and inclusion p.58
Circular economy
and waste p.52, p.55
Training and skills
development p.59
Community
engagement p.63
Corporate culture p.66
Responsible supply
chain p.67
Macroeconomic environment p.39
Key
I
Impact material
RS Group’s impact on the
wider world
F
Financially material
Financial risks and
opportunities of sustainability -
related topics for RS Group
D
Double material
Both a financial risk or
opportunity for RS Group and
an impact created by RS Group
OUR MATERIAL ESG TOPICS
ENVIRONMENT
ADVANCING
SUSTAINABILITY
Developing sustainable
operations and product
and service solutions
for our customers
and suppliers.
+ Read more on pages
48-55
OUR 2030 ESG
ACTION PLAN
+ Read more on page 47
EMPOWERING
OUR PEOPLE
Creating an inclusive and
engaging environment
where everyone is proud
and excited to come to
work and can perform
at their best, develop
and thrive.
+ Read more on pages
56-60
CHAMPIONING YOUTH
& COMMUNITIES
Inspiring the next
generation of engineers and
innovators and supporting
our communities worldwide
to improve people’s
lives and create a more
sustainable world.
+ Read more on pages
61-63
GOVERNANCE
DOING BUSINESS
RESPONSIBLY
Ensuring the highest
ethical and environmental
standards throughout
our business and global
value chain.
+ Read more on pages
64-67
I
Corporate
governance p.65, p.66
Our 2030 ESG action plan
FOR A
BETTER WORLD
RS Group plc Annual Report and Accounts 202546
1. Scope 1 and 2 emissions have been updated to reflect improvements to our reporting methodologies with more detail provided in our
basis of reporting: rsgroup.com/sustainability. Progress includes emissions from acquisitions within all reporting years from 2019/20 to
2024/25.
2. Packaging recycled content metric updated to exclude wood from pallets, which is sustainably sourced material, rather than recycled
content. All prior years have been updated to reflect this change.
3. Tonnes of CO
2
e due to Scope 3 transportation emissions per tonne of product sold.
4. 97 of 139 senior leaders self-reported ethnicity via the employee database (including not specified/prefer not to say, excluding markets
where RS cannot collect this data) and 10 identified as non-white.
5. Per 200,000 hours worked.
GLOBAL GOALS
ADVANCING
SUSTAINABILITY
DOING BUSINESS
RESPONSIBLY
EMPOWERING
OUR PEOPLE
CHAMPIONING YOUTH
& COMMUNITIES
26%
reduction in Scope 3
transport emissions
intensity
3
since 2019/20
36%
reduction in our all
accident frequency rate
5
since 2019/20
30%
of our employees
volunteered to support
their local communities in
the last two years
75%
of RS PRO suppliers are
Sedex members
82%
of our packaging has
>50% recycled content, an
increase of 16% pts since
2023/24
2
37%
of our senior leaders
are women and 10% are
ethnically diverse
4
£963K
raised for The Washing
Machine Project (TWMP) to
improve lives since 2020/21
38%
of suppliers by spend set
science-based targets
64%
reduction in Scope 1 and 2
emissions since 2019/20
1
72
employee engagement
score down from 75 in
2023/24
913K
young engineers and
innovators supported since
2020/21
48%
of employees have their
annual incentives aligned
to carbon reduction targets
Net zero emissions in direct operations by
2030 and value chain before 2050 with four
science-based targets (SBTs) covering our most
material emissions areas: operations, logistics,
products and suppliers.
Achieve and maintain an employee
engagement score in the top 10% of
high-performing companies.
Inspiring one million young people to
become future engineers and innovators.
Increasing screening and ESG objectives for
suppliers. ESG metrics in employee rewards.
A summary of progress against each of our global goals and key action areas can be found in the table below, with detailed progress updates against all 14 ambitions outlined on pages 48 to 67.
All ESG data includes post-acquisition data for businesses acquired by the Group up to 2024/25, unless stated otherwise. To read more about our ESG approach, including our methodology for
collecting and calculating ESG data, accounting for acquisitions and historical performance see: rsgroup.com/sustainability
KEY ACTION AREAS PERFORMANCE HIGHLIGHTS
RS Group plc Annual Report and Accounts 2025 47GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
2030 AMBITIONS METRICS ACTIONS STATUS READ MORE
By 2030 in our direct operations:
Carbon emissions: Be net zero with an
SBT to reduce absolute emissions from
our own operations by 75%
1
64%
reduction in Scope 1
and 2 emissions since
2019/20
2
– Site energy efficiency and decarbonisation projects
resulting in an 11% reduction in gas consumption across
the Group in 2024/25
– Included in CDP’s prestigious A-list for the first time, having
improved our CDP rating this year from A- to A
+ See pages 49
to 52
rsgroup.com/
sustainability
Packaging: Make our packaging more
sustainable: reduce intensity by 45%
1,3
with 100% of packaging widely reusable
or recyclable and made with at least 50%
recycled content
37%
reduction in
packaging intensity
since 2019/20⁴
– Optimising our carton sizes and selecting more sustainable
packaging materials
Recycling and waste: Reduce, reuse
and recycle our waste: reduce intensity
by 50%
1
, recycle > 95% and achieve zero
waste to landfill in our direct operations
84%
of total waste recycled
– Shared learnings and best practice across our sites to
reduce packaging and increase recycling rates
Working towards a net zero global value chain by 2050:
Product transportation: Reduce Scope
3 transport emissions by 35% per tonne
of product sold
1,5,6
26%
reduction in intensity
of Scope 3 transport
emissions since
2019/20
6
– Switching customer deliveries from an air to a road-based
service reduced European emissions intensity by 6% from
2023/24
+ See pages 53
to 55
Products and solutions: Develop
innovative and sustainable product and
service solutions for all our customers,
including offering 100,000 Better World
products
1
c. 30K
products in the Better
World product range
– c. 30,000 Better World products across 345 product
families from 132 suppliers available in 30 countries
– Providing customers with more options for specific product
types, such as PPE and workwear and introduced a new
sales tool
Supplier sustainability: Commit to
engaging 67% of suppliers by spend to
set SBTs by 2025
38%
of suppliers by spend
have set SBTs
– Introduced ESG as the eighth pillar of our EMEA strategic
supplier approach
+ See page 67
Status key:
Each of our actions are broken down into annual targets that
need to be met to remain on track to achieve our 2025 and
2030 goals. The key below reflects our current position:
On track or ahead
Slightly behind target – monitor closely
Not on track – further action required
1. By 2029/30 from 2019/20.
2. Scope 1 and 2 emissions have been updated to reflect improvements to our reporting
methodologies with more detail provided in our basis of reporting. Progress includes emissions from
acquisitions within all reporting years from 2019/20 to 2024/25.
3. Target reset in 2024/25. Previously 30% reduction in packaging intensity from 2019/20 to 2029/30.
See page 52.
4. Tonnes per £m revenue.
5. Target reset in 2024/25. Previously 25% reduction per tonne of product sold. See page 53.
6. Tonnes of CO
2
e due to Scope 3 transport emissions per tonne of product sold.
As a critical partner to the global industrial
sector, we play an important role in advancing
sustainability and tackling climate change.
By developing a cleaner and greener
distribution service and providing sustainable
product and service solutions, we can make a
real and lasting impact and differentiate our
brand as a strategic partner to our customers
and suppliers.
ADVANCING
SUSTAINABILITY
Environment
RS Group plc Annual Report and Accounts 2025 48
Our net zero plan
Our ambition is to be net zero in our direct operations by 2030 and across our wider value chain by 2050. This means implementing our science-based emissions reduction targets across Scope 1, 2 and 3
emissions and using certified Gold Standard offsets for any additional residual, hard-to-abate emissions. To achieve this, we have set four SBTs, which are validated by the Science Based Targets initiative (SBTi)
and cover the Group’s most material emissions areas, including our direct operations, logistics, suppliers and products. These targets and their supporting initiatives drive our decarbonisation approach in line
with the 2015 Paris Agreement to limit global warming to 1.5°C above pre-industrial levels. Our detailed climate performance covering our direct and indirect activities can be found on pages 50 to 51, our Task
Force on Climate-related Financial Disclosures (TCFD) response on pages 68 to 73 and our independent assurance statement from ERM CVS on pages 74 and 75.
Upgrading our distribution
sites to be more automated,
energy efficient and sustainable
to provide a better service to
our customers and reduce our
environmental impacts.
Key actions in 2024/25:
– 34 energy efficiency projects
at our sites including replacing
gas boilers, introducing sub
metering through building
management systems,
switching to LED lighting and
installing rapid roller doors
– Resulted in an 11% reduction
in gas consumption across the
Group in 2024/25
Impact
41%
reduction in energy
intensity since 2019/20
Impact
93%
renewable electricity
use in 2024/25
Impact
39%
Group company cars and 86%
of UK fleet are electric or hybrid
Impact
C. 30K
Better World products offered
to customers in 2024/25
Impact
26%
reduction in product transport
intensity since 2019/20
2
Impact
38%
of suppliers by spend set
carbon targets with SBTi
Expanding our range of
sustainable product and
service solutions to help
customers reduce costs, save
resources and achieve their
environmental goals.
Key actions in 2024/25:
– c. 30,000 Better World
products from 345 product
families available in 30
countries (see page 54)
– 132 suppliers in range; 44
joined in 2024/25 (see page 54)
– Low-carbon industry sectors
– identified 10 strategic
suppliers with over 200 initial
product lines to develop
bespoke wind turbine spares
catalogues (see page 55)
Generating and procuring
renewable electricity by
installing solar panels at
our sites and procuring
green electricity.
Key actions in 2024/25:
– Solar power provided 29%
of the electricity consumed
across our sites in Germany,
Spain and South Africa
– Conducted survey at Risoul’s
fulfilment centre (FC) in
Monterrey, Mexico to explore
viability for installing solar
panels on the roof
– Group Energy Management
Policy to procure green
electricity for all sites.
Where this is not possible, we
purchase Energy Attribute
Certificates for select sites
Cutting the distance our
products travel by sourcing,
storing and shipping closer
to customers and suppliers
and switching to less carbon
intensive modes of transport.
Key actions in 2024/25:
– Transport emissions intensity
at Group level is unchanged in
2024/25
– Continued modal shift (from
air to road and sea), regional
supply chain restructuring and
supply chain optimisation
– Switched customer deliveries
from an air to a road-based
service, reducing European
emissions intensity by 6% from
2023/24 (see page 53)
Transitioning our company car
and van fleet to electric and
hybrid vehicles and encouraging
adoption by our people.
Key actions in 2024/25:
– 39% Group company cars and
86% of UK fleet are electric
or hybrid
– Risoul transition to hybrid
company cars commenced
with the team leasing 37
hybrid cars
– RS Safety Solutions
transitioning to HVO
1
fuel
for their HGV logistics fleet
in the UK. Resulted in a 23%
reduction in HGV-related
carbon emissions for RS Safety
Solutions fleet in 2024/25
Collaborating with our suppliers
to drive carbon reductions
across the value chain,
including sourcing, designing,
manufacturing and shipping
products more sustainably.
Key actions in 2024/25:
– ESG introduced as the eighth
pillar of our strategic supplier
approach in EMEA
– Updated ESG Supplier
Handbook and introduced
new supplier video designed
to engage suppliers on
material ESG topics
– Engaged with over
110 suppliers to target
development of more
sustainable products for
inclusion in the Better World
product range
1. Decarbonising
our buildings
1. Sustainable product
and service solutions
2. Switching to
renewable electricity
2. Product
transportation
3. Creating a
net zero fleet
3. Supplier
sustainability
NET ZERO ACROSS OUR DIRECT OPERATIONS BY 2030
We are committed to taking action to decarbonise our direct operations. Our three priority areas are:
NET ZERO ACROSS OUR VALUE CHAIN BY 2050
Over 99% of our emissions sit within our global value chain, which is where we have the greatest
opportunity to drive change and create value for our stakeholders. Our three priority areas are:
pages 50 and 51
1. Hydrotreated vegetable oil. 2. Tonnes of CO
2
e due to Scope 3 transport emissions per tonne of product sold.
pages 53 to 55
Enabled by:
Access to
technologies
Government policies
and incentives
Energy grid
decarbonisation
Gold Standard
certified offsets
RS Group plc Annual Report and Accounts 2025 49GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Environment continued
CARBON EMISSIONS
IN OUR DIRECT OPERATIONS
By 2029/30, our ambition is to be net zero
in our direct operations. We have set a SBT
validated by the SBTi to reduce absolute
emissions from our own operations by
75% and will use Gold Standard certified
offsets closer to 2030 for any residual,
hard-to-abate emissions.
ADVANCING SUSTAINABILITY
WITHIN OUR BUSINESS
We have made good progress in transitioning to
a net zero fleet. We increased the proportion of
company cars that are electric or hybrid for the
Group to 39% (2023/24: 30%) and for the UK to
86% (2023/24: 79%). This has contributed to a
reduction in our diesel usage across the Group by
3% from 2023/24.
In 2024/25, RS locals in the UK transitioned 12
light commercial vehicles to electric. Risoul in
Mexico switched 37 vehicles to hybrid with its full
company car fleet to be transitioned by 2028.
Carbon reduction is a core KPI for the Group and
48% of employees were incentivised to achieve
Scope 1 and 2 emissions reduction goals in
2024/25.
Scope 1 and 2 (market-based)
emissions (tonnes CO
2
e)
Excluding recent acquisitions
1
6,300
7% reduction from 2023/24
Including recent acquisitions
2
6,500
4% reduction from 2023/24
Carbon intensity (tonnes CO
2
e)
2.2
8% reduction from 2023/24
Scope 1 and 2 emissions have been updated to reflect improvements to our reporting methodologies with more detail provided
in our basis of reporting.
1. In year progress reduction is on a like-for-like basis with 2023/24 and excludes full year emissions from Trident and quarter one (Q1)
emissions from Distrelec.
2. Progress includes emissions from acquisitions within all reporting years from 2019/20 to 2024/25.
3. Includes post-acquisition data from acquired businesses Trident Australia Pty Ltd (Trident) (completed in 2024/25), Distrelec B.V (Distrelec)
(completed in 2023/24), domnick hunter-RL (Thailand) Co., Ltd. (DH) (completed in 2022/23) and Risoul y Cia, S.A. de C.V. (Risoul)
(completed in 2022/23).
We remain committed to achieving our Group net
zero ambition and to working with our acquired
businesses to decarbonise their operations,
while engaging with our customers and suppliers
to drive collective action to decarbonise our
value chain.
Our ESG team is continuing to support
operational teams at our acquired businesses
of domnick hunter, Risoul, Distrelec and Trident
to develop decarbonisation plans aligned to the
Group’s net zero ambition and SBTs. This includes
utilising renewable electricity, delivering energy
saving initiatives, switching to hybrid and electric
vehicles and optimising logistics.
This has been achieved through energy efficiency
and low-carbon technology projects, switching to
renewable electricity and transitioning towards
a net zero fleet. Since 2019/20, we have reduced
our direct carbon footprint by 64%
2
.
We achieved a 4% reduction in energy
consumption in 2024/25 and a 10% reduction
from 2019/20. Our gas consumption in the year
reduced by 11% from 2023/24. The Group’s
energy intensity has reduced by 41% since our
baseline year of 2019/20.
In 2024/25, we continued to make good progress
in reducing Scope 1 and 2 emissions. We reduced
our direct carbon footprint by 7% this year from
6,800 tonnes in 2023/24 and by 4% including
recent acquisitions
1,2
.
Scope 1 and 2 (market-based)
emissions (tonnes CO
2
e)
6,500
19/20
17,900
9,200
8,000
7,700
6,500
20/21 21/22 22/23 23/24 24/25
10,900
CO
2
e (tonnes) including emissions from
acquired businesses prior to RS ownership
2
CO
2
e (tonnes) including emissions from
acquired businesses from the point of
RS ownership
3
75%50%25%0% 100%
% of 2019/20 base year emissions
29/3024/25
64% reduction
from 2019/20
19/20 27/28
Trajectory for 1.5°C
75% reduction in Scope 1 and 2
emissions by 2029/30
Actual performance 2019/20 to 2024/25
Net zero trajectory 2025/26 to 2029/30
Limited offsets to achieve net zero
OUR PATHWAY TO NET ZERO IN OUR DIRECT OPERATIONS
RS Group plc Annual Report and Accounts 202550
Scope 3 GHG emissions
1
Key Scope 3 emissions categories (tonnes CO
2
e)
% change
from 2020 2025 2024 2023
Category 1: Purchased goods and services
*
SBTi target: % of suppliers by spend with SBTs
(33)%
+23% pts
2.2m
38%
2.9m
32%
2.9m
25%
Category 4: Upstream transportation and distribution
2*
SBTi target: Product transportation carbon intensity
(tonnes CO
2
e per tonne of product sold)
*
(16)%
(26)%
49,600
1.23
48,400
1.23
49,400
1.23
Category 11: Use of (RS PRO) sold products
3*
SBTi target: RS PRO products in-use carbon intensity
(tonnes CO
2
e per tonne of product sold)
*
+2%
(19)%
1.4m
122
1.5m
131
1.7m
151
Remaining Scope 3 categories – 24,000 25,000 22,000
Total Scope 3 GHG emissions (tonnes CO
2
e) (23)% 3.7m 4.5m 4.7m
1. Scope 3 emissions have been updated to reflect improvements to our reporting methodologies with more detail provided in our basis of
reporting: rsgroup.com/sustainability. Our complete Scope 3 dataset and our methodologies for key categories can be found in our
basis of reporting document and our ESG data centre on our website: rsgroup.com/sustainability.
2. Includes only inbound, outbound and inter-site deliveries controlled by RS Group.
3. Scope 3 Category 11 figures have been updated to correct an error identified in the classification of a specific product group.
2024/25 metrics marked (*) have been independently assured by ERM CVS. See independent assurance report on pages 74 to 75.
Greenhouse gas (GHG) emissions
(Scope 1 and 2) and Streamlined
Energy and Carbon Reporting (SECR)
disclosure
In accordance with UK SECR requirements,
our 2024/25 Group Scope 1 and 2 emissions
are summarised in the table below and
include up to date acquisition data and
methodology improvements.
In 2024/25, the Group commissioned
independent external assurance from
ERM CVS of metrics marked with an asterisk
(*). Their independent assurance report is set
out on pages 74 to 75.
Metric Unit 2025 2024
Scope 1 GHG emissions tonnes CO
2
e 5,734 5,808
Scope 2 GHG emissions (market-based) tonnes CO
2
e 778 975
Scope 2 GHG emissions (location-based) tonnes CO
2
e 7,083 7,655
Total Scope 1 and Scope 2 (market-based) GHG emissions
*
tonnes CO
2
e 6,512 6,783
Emissions from premises sources tonnes CO
2
e 3,192 3,457
Emissions from vehicle sources tonnes CO
2
e 3,320 3,326
Intensity metric: Total Scope 1 and Scope 2 (market-based)
GHG emissions per £m revenue
*
tonnes CO
2
e/£m 2.2 2.4
Total energy consumption GWh 54 56
Electricity use from renewable sources % Group electricity 93% 90%
Electricity use from own renewable generation % Group electricity 2% 2%
Notes to SECR disclosures
– 2024/25 metrics marked (*) have been independently assured by ERM CVS. See independent assurance report on pages 74 to 75.
– UK SECR: 41% of Scope 1 emissions, 39% of Scope 2 (location-based) emissions, zero market-based emissions and 45% of energy
consumption from UK operations.
– GHG emissions are reported in accordance with the Greenhouse Gas Protocol Corporate Accounting and Reporting Standard (Revised),
under a financial control boundary.
– Department for Energy Security and Net Zero and Department for Business, Energy & Industrial Strategy (BEIS) (2024) emission factors
are applied, unless emission factors from other sources are deemed more appropriate.
– Reported emissions include emissions from acquired businesses from the point of RS ownership.
– Intensity metric figures are on a constant exchange rate basis and these, alongside the Scope 1 and 2 figures, have been updated to
reflect improvements to our reporting methodologies.
– Further details can be found in our basis of reporting document alongside our full suite of ESG metrics in our ESG data centre on our
website: rsgroup.com/sustainability.
Scope 3 emissions
As a global distributor of industrial product and
service solutions, Scope 3 emissions represent
over 99% of our total carbon footprint.
In 2024/25, emissions from the Group’s three
most material Scope 3 emissions categories
(covering our products, suppliers and logistics)
totalled some 3.7 million tonnes CO
2
e
1
. We have
set SBTs for each of these categories which were
validated by the SBTi in 2023/24.
It is vital that we collaborate with our suppliers
and customers to work together to reduce our
value chain emissions. In doing so, we are driving
collective climate action and creating greater
value for all our stakeholders. For details of our
actions on this see pages 53 to 55 and 67.
Our Scope 3 emissions performance breakdown
by material category can be found in the
table below. Our complete Scope 3 emissions
inventory including all relevant categories can be
found in our ESG Report and ESG data centre.
Our reporting methodologies are detailed in our
basis of reporting document. All documents can
be found at: rsgroup.com/sustainability
Environmental Management
Systems (EMS)
The majority of our distribution sites have a
robust EMS in place to manage risk, track ongoing
performance and identify opportunities to target
further emissions reductions. Additionally, 34
sites covering 51% of our operations by revenue
and 58% by floor area, are covered by ISO 14001
environmental management certifications.
RS Group plc Annual Report and Accounts 2025 51GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
PACKAGING
By 2029/30, we want to make our packaging
more sustainable: reduce intensity by 45%
1
and 100% of packaging to be widely reusable
or recyclable and made with at least 50%
recycled content.
Packaging intensity
2,3
1.55
4% reduction from 2023/24
% packaging made with at least 50%
recycled content
4
82%
16% pts increase from 2023/24
% packaging reusable or recyclable
94%
unchanged from 2023/24
Packaging sustainability is a critical issue for our
customers. They want to know that we are taking
proactive measures to reduce the amount of
packaging used, while increasing the amount
of recycled content and recyclable materials to
minimise waste and promote a circular economy.
In 2024/25, our packaging intensity reduced by
4% from 2023/24 and by 37% from 2019/20.
We have reduced overall packaging tonnage by
optimising our carton sizes to reduce the amount
of materials required and by selecting more
recycled and recyclable alternatives for our core
packaging materials across the Group.
We made significant progress in switching to
recycled content material across our regions this
year to support our customers:
RECYCLING AND WASTE
By 2029/30, we want to reduce, reuse and
recycle our waste: reduce intensity by 50%,
recycle over 95% and achieve zero waste to
landfill in our direct operations.
Waste intensity
2,3
1.38
decreased by 3% from 2023/24
Waste recycled
84%
increased by 2% pts from 2023/24
We are committed to reducing, reusing and
recycling our waste to create a cleaner and
greener world. By reducing our use of natural
resources, we can also reduce costs and support
customer and supplier sustainability preferences.
In 2024/25, waste segregation, recycling and
reuse remained a priority for our distribution site
management teams. Following the success of our
continuous improvement project in 2023/24 at
our global distribution centre (DC) in Nuneaton,
UK, which focused on reducing packaging and
increasing recycling rates, we have shared the
learnings with our other distribution sites.
– RS in EMEA and Asia Pacific: increased
recycled content in paper mailbags to 57%,
which had previously been manufactured from
virgin materials
– RS in Americas: increased the proportion
of packaging made with over 50% recycled
content from 49%
5
in 2023/24 to 88% in
2024/25
– RS in EMEA: moved to brown paper bags made
with over 50% recycled content, which impacts
approx. 30 tonnes per year
– RS in the UK: switched to thermal labelling
on packaging, reducing the need for
paper-backed labels
Combined, these efforts mean that 82% of total
packaging by weight is made from materials
that contain at least 50% recycled content.
This represents a 16 percentage points increase
in recycled content from 2023/24
4
. 94% of our
packaging was reusable or recyclable, unchanged
from 2023/24.
Reflecting our strong progress from the baseline
year and future packaging action plan, during the
year we increased our 2030 target for packaging
intensity to 45% reduction from 2019/20
by 2029/30 (previously 30%). The additional
reduction will be driven by material changes
such as more automation and continuous
improvement activities, with budgeted initiatives
built into the five-year strategic plan.
In 2025/26, we will continue to reduce and
improve our packaging by extending our
automated packaging machine footprint,
improving material selection and usage and
investing in more reusable pallets for our
internal product movements within Europe.
Alongside this, we will continue to collaborate
with both suppliers and customers to support
packaging sustainability efforts in the industry.
An example is using QR codes to direct customers
to more information on our sustainable
packaging approach, including guidance on local
legislative requirements.
This contributed to a 2 percentage point increase
in the global recycling rate. Additionally, we
continued to improve waste standards and polices
that enhance the Group’s waste management and
global resource usage.
In 2024/25, at our regional DC in Beauvais, France
we introduced some key measures to help reduce
product waste, specifically for products that
cannot be sold as new or returned to the supplier.
We have a dedicated second-hand platform where
products are offered to customers at a discounted
rate for a six-month period. After six months, they
are offered to brokers to resell within the industry
or they are sent to specialist recycling providers.
From this initiative in 2024/25, we have avoided
over £600,000 worth of product waste.
In 2024/25, our waste intensity decreased by 3%
from 2023/24, bringing the total reduction to 8%
since the 2019/20 baseline year. The proportion
of total waste recycled increased by 2 percentage
points to 84%. Waste that is not recycled is
typically sent for incineration, energy recovery and
only to landfill as a last resort. In 2024/25, 11% of
our total waste was incinerated and 5% was sent
to landfill.
1. Packaging intensity target extended from 30% to 45% in
2024/25.
2. Tonnes/£million revenue.
3. KPIs are on a constant exchange rates basis and are updated to
reflect changes in reporting methodology.
4. Packaging recycled content metric updated to exclude wood
from pallets, which is sustainably sourced material, rather than
recycled content. All prior years have been updated to reflect
this change.
5. Prior year updated to reflect changes in reporting methodology.
Environment continued
RS Group plc Annual Report and Accounts 202552
We collaborate with our suppliers to prioritise
carbon reductions, optimise sourcing and
distribution routes and improve the sustainability
benefits and features of their products,
while providing unrivalled and cost-effective
market reach to position these sustainability
improvements to customers.
With our customers, we provide a growing range
of sustainable product and service solutions to
enable them to operate efficiently, sustainably
and safely.
As an essential link in the global industrial
sector, we are ideally positioned to help
our customers and suppliers accelerate
sustainability performance while
strengthening our businesses, creating new
commercial opportunities and delivering
greater value for all our stakeholders.
ADVANCING SUSTAINABILITY
WITHIN OUR VALUE CHAIN
PRODUCT TRANSPORTATION
By 2029/30, we aim to reduce Scope 3
transport emissions intensity by 35%¹ per
tonne of product sold.
Scope 3 transport emissions intensity
1,2
1.23
unchanged from 2023/24
With thousands of product shipments every
day, including inbound supplier deliveries and
outbound customer deliveries, it is critical that we
continue to optimise our global supply chain to
reduce our transport emissions. In 2024/25, our
transport emissions intensity² was unchanged
from 2023/24, with an overall decrease of 26%
from 2019/20.
In 2024/25, we continued to restructure our
supply chain to source, store and ship more
products locally and regionally, optimise logistics
and prioritise modal shifts from air to sea and
road. Our focus during the year was on delivering
logistics efficiencies and optimisation for RS
in EMEA:
– We completed further modal shifts within
Europe, switching customer deliveries from
an air to a road-based service. This involved
consolidating orders at our distribution sites
before transporting to customers via a local
road-based carrier. This action has helped to
reduce European emissions intensity by 6%
from 2023/24.
– As we worked at pace to integrate Distrelec
into the RS business and benefit from the
long-term efficiencies and value this creates,
we commenced exiting their distribution
site in the Netherlands. This has resulted in
a short-term increase in product lines being
shipped from the UK. However from 2026/27,
the products will be stored and shipped by road
from our regional DC in Bad Hersfeld, Germany,
benefitting our European customers.
In Americas, progress in reducing emissions from
logistics remained flat as we continued to focus
on integrating Risoul. In Asia Pacific, we reduced
the emissions intensity of customer deliveries by
15% during the year.
Despite this proactive action, our emission
intensity continued to be impacted by external
influences outside our control. The global
emissions factors used to calculate our transport
emissions remained higher than anticipated and
the uncertain geopolitical climate continued to
present global supply chain challenges, which
impacted our supply routes and modal options.
In 2024/25, our 2030 target for product transport
emissions intensity was increased, taking
account of our strong progress to date. This will
be achieved by further reducing air travel and
prioritising local sourcing, where possible, thereby
reducing operational cost and carbon emissions.
1. Target extended in 2024/25 (previously 25% per tonne of product sold).
2. Transport emissions intensity (tonnes of CO
2
e from inbound, outbound and inter-site deliveries controlled by RS Group, per tonne of
product sold).
RS Group plc Annual Report and Accounts 2025 53GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Environment continued
SUSTAINABLE PRODUCTS
By 2029/30, we want to develop innovative
and sustainable product and service solutions
for all our customers, including an ambition to
offer over 100,000 Better World products.
Sustainable products
C. 30,000
products in our Better World product
range in 2024/25
Better World products enable our customers
to make more sustainable and responsible
purchasing decisions they can trust. Our
claims-based framework, launched in 2023/24,
empowers customers to make trusted and
informed choices about product sustainability
improvements that are backed by clear, credible
and verified sustainability claims. This is a real
differentiator and value add, particularly for our
high-value, strategic customers who are looking
for tangible ways to reduce their carbon footprint
while improving operational efficiency and
reducing costs.
Better World products address
the growing market demand for
sustainable solutions by providing
transparency. It empowers customers
to make more informed purchasing
decisions, which supports their journey
towards a more resource efficient future.”
ABB
Strategic Supplier Partner
Additionally in 2024/25, we introduced a new sales
tool aimed at helping our strategic customers
choose Better World product alternatives
within their procurement decisions. Currently,
the tool has been available to a select team in
the UK to support with bids and tenders in the
public sector. Over time, our goal is to expand
the tool’s availability and offer more customers
valuable insights on how to access Better World
product alternatives.
Our ambition is to grow the Better World product
range to over 100,000 products by 2029/30 and
create a clear and robust sustainability standard
for our industry that supports both customers
and suppliers. As we progress the framework we
will focus on evolving the product families and
encouraging new suppliers to participate.
The Better World product range forms the
foundation of our sustainable revenue activity.
During 2024/25, we began to conduct an initial
eligibility assessment to identify the full range of
potentially eligible economic activities that may fall
under the scope of the EU Taxonomy. We intend
to progress this work further during 2025/26 and
will closely monitor disclosure requirements and
materiality levels related to emerging legislation.
+ Download the Better World product guidelines
here: rsgroup.com/sustainability/advancing-
sustainability/sustainable-products
Examples of products by claim type within the
framework include:
– Made more sustainably: products that are
produced using more sustainable materials or
manufacturing processes, for example RS PRO
wire cables that save more than 10% in carbon
emissions during their manufacture or storage
bins made from 98% bio-based materials
– Sustainable solution: products that help
customers run their business more sustainably,
from reducing energy and emissions to
protecting health and safety, for example RS
PRO voltage optimisers that save energy by
ensuring only required voltage is used to power
equipment and any surplus is returned to
the grid
– Supports circularity: products with an
increased lifespan, or that can be reused,
repaired or recycled to reduce waste, for
example safety gloves with an extended
product lifespan
Our Better World product range features c. 30,000
products from 132 suppliers and includes over
1,700 products that support energy and carbon
reduction or renewable energy generation across
customer facilities. In 2024/25, we added 44
suppliers and over 2,500 products to the range,
replacing products that were no longer eligible
and diversifying product choice for our customers.
In 2024/25, we enhanced the Better World
product range to provide customers with more
options for specific product types, such as PPE
and workwear. These products are essential but
typically have short lifecycles. A shift towards
sustainability will reduce waste and create a
commercial opportunity with customers who
have strong ESG commitments. So far, we have
engaged 32 PPE and workwear suppliers to add
245 products to the range.
SUPPLIER SUSTAINABILITY
By 2025, we commit to engaging 67% of
suppliers by spend to set SBTs.
Suppliers by spend setting SBTs
38%
6% pts increase from 2023/24
With over 800,000 stocked products from over
2,500 suppliers and a significant proportion of
our Scope 3 emissions from purchased goods
and services, it is vital that we engage, inspire
and collaborate with our supplier partners to
decarbonise our value chain. In doing so, we
can create long-term value while helping our
suppliers reach higher levels of sustainability and
make their products and services more attractive
to customers.
We continued to engage with our key suppliers
in 2024/25 to encourage them to develop and
offer more sustainable products, prioritise
carbon reduction and set SBTs. Through regular
interactions, supplier events, quarterly business
reviews (QBRs) and supplier ESG communications,
we have made good progress in encouraging our
suppliers to take sustainability action.
In 2024/25, 38% of suppliers by spend have set
SBTs with the SBTi, an increase of 6 percentage
points from 2023/24. Despite steady progress,
we are not on track to meet our 2025 ambition
of 67%. Our current supplier sustainability target
will come to an end at the end of 2025, so we will
be engaging with the SBTi on our future target
while continuing our programme of supplier ESG
engagement to influence further progress.
RS Group plc Annual Report and Accounts 202554
Supporting low-carbon industries
In addition to our range of Better World products
and efficiency solutions, RS plays an important
role in enabling the transition to a low-carbon
economy by supporting new, sustainable
industries. We support the growth of
low-carbon industries by providing their product
procurement, industrial MRO and logistics needs,
while creating new green revenue streams from
high-value growth industries.
We partner with the UK renewables sector to
enable fast access to critical MRO products
and solutions, which minimise their downtime
and support an efficient infrastructure in both
offshore and onshore wind. We have taken steps
this year to better understand our customers’
needs and how our digital solutions can support
the renewables sector by enabling customers to
access the right equipment, balance costs and
keep technicians safe.
– Offshore wind: Engaging with seven
subsectors, we have developed an aligned
offer that combines a global supplier network,
bespoke wind technician tool kits, calibration
services, wind turbine oil analysis and
efficient inventory management. In 2024/25,
we identified 10 strategic suppliers and
expanded our catalogue to include around
200 wind turbine spares and parts to support
maintenance of aging turbines.
– Onshore wind: Building on the offshore
wind model, we have built bespoke tool kits
for onshore wind customers to increase
operational efficiency.
– Education in renewables: In 2024/25, we
funded a Kinewell Energy programme in the
UK to deliver a version of its state-of-the-art
artificial intelligence based software ‘KLOC’
to secondary and further education schools.
The software enables automated cable layout
design of new offshore wind farms, supporting
decarbonisation in the sector while inspiring
students in STEM.
Our collaboration with RS has resulted
in a significant improvement in both
safety and operational efficiency.”
Specialist Engineer
Siemens Gamesa Renewable Energy
SUSTAINABLE SERVICE
SOLUTIONS
Sustainability solutions
We want to help our customers run their
businesses more efficiently, cost effectively,
safely and sustainably at all stages of the
industrial lifecycle. By offering value-added and
sustainability-focused industrial MRO services,
we are strengthening customer relationships
and increasing revenue through service fees and
product pull through:
– Maintenance, repair and operations: We
offer industrial MRO solutions including energy,
water and compressed air leakage surveys that
promote operational efficiency, cut costs and
reduce emissions.
Highlights: In 2024/25, we completed a
successful trial of surveys for customers in
the UK and Ireland linked to operational
compressed air, heat loss/steam loss, panel
thermography, LED lighting and pumps.
These surveys helped to identify potential
savings of c. £84,000 and around 150 tonnes
CO
2
e for 20 customers across 101 sites taking
part in the trial.
– Circular economy solutions: We are
committed to developing solutions for
customers that minimise waste and promote
a circular economy. One of the ways we are
enabling this is through RS ControlStock
®
,
a secure, end-to-end digital solution
designed to manage fast-moving
products through automatic stock
ordering and process optimisation
to reduce costs and waste
for customers.
Highlights: In 2024/25, RS ControlStock
®
was successfully utilised by our customer,
Butternut Box, to overcome issues relating
to stock visibility and manual processes.
The implementation has saved over 1,700 in
people hours, equating to over £30,000 per
year in savings. This resulted in zero stock-
outs, eliminating over- and under-ordering
and product and logistics waste. Additionally,
2024/25 we began working with a supplier
in France to trial a combined product return
and refurbishment scheme aimed at reducing
waste without compromising product quality
and accessibility. The trial will support the
development of a solution model to offer
refurbished products to our customers.
– Health and safety (H&S) solutions: In the UK,
we have partnered with training providers to
create a comprehensive suite of H&S training
courses and customer site surveys including
air quality testing, fire risk assessments, H&S
audits and healthy building certification.
Highlights: In 2024/25, we piloted H&S
training courses in the UK, in collaboration
with five training providers to deliver tailored
support for 16 customers.
RS Group plc Annual Report and Accounts 2025 55GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Social
2030 AMBITIONS METRICS ACTIONS STATUS READ MORE
Engaged employees:
Achieve and maintain an
employee engagement
score in the top 10% of
high-performing companies
72
employee
engagement score
(out of 100)
– Introduced quarterly My Voice pulse surveys for frequent
engagement tracking
– Rolled out and embedded global values through workshops and
online tools
+ See page 57
rsgroup.com/
sustainability
Diversity and inclusion
(D&I):
Ensure our team is reflective
of the customers, suppliers
and communities we serve
and create an inclusive and
engaging environment where
everyone is proud and excited
to come to work and can
perform at their best, develop
and thrive
37%
women in senior
leadership roles
– Continued participation in accelerator programmes for diverse talent
(Women Rising and Mission Include)
– Broadened recruitment efforts to attract the best talent for open roles,
including senior leadership
+ See page 58
10%
ethnically diverse
senior leaders
1
Health and safety (H&S):
Aim for zero accidents
involving our people
0.44
all accident frequency
rate per 200,000 hours
– Further developed and embedded our H&S culture through a
behaviour-based safety campaign, targeted training, inspections,
audits and regular near miss reporting
– Employees completed close to 27,000 hours of comprehensive H&S
training aligned to best practice
+ See page 60
1. 97 of 139 senior managers self-reported ethnicity via the employee database (including not specified/prefer not to say) and 10 identified as non-white.
Status key:
Each of our actions are broken down into annual
targets that need to be met to remain on track to
achieve our 2025 and 2030 goals. The key below
reflects our current position:
On track or ahead
Slightly behind target – monitor closely
Not on track – further action required
More information is available
in our full ESG scorecard:
rsgroup.com/sustainability
Our unique team of c. 8,500 individuals is
the lifeblood of our business. Every day, their
passion and expertise enable us to provide
product and service solutions that delight our
customers and suppliers and make amazing
happen for a better world.
Our commitment is to be first choice for our
people, creating an inclusive and engaging
environment where everyone is proud and
excited to come to work and can perform at
their best, develop and thrive.
EMPOWERING
OUR PEOPLE
RS Group plc Annual Report and Accounts 202556
EMPLOYEE ENGAGEMENT
By 2029/30, we want to achieve and maintain
an employee engagement score in the top 10%
of high-performing companies
1
.
Engagement score
72
engagement score down
by three pts from 75 in 2023/24
Building a high-performance, engaged, and
motivated team hinges on consistent, active
listening. To uphold our values-driven culture
and effectively address our team’s needs,
we introduced pulse surveys in 2024/25.
These surveys help us continuously gauge
employee satisfaction and engagement.
We have tracked employee engagement over the
last year on a quarterly basis. From an initial drop
from 75 in the last main survey (October 2023),
we have seen quarterly engagement maintained
at 72 across the Group. Our most recent pulse
survey was conducted in December 2024 and
served as the annual update on our overall
engagement score. Participation was strong with
a 71% response rate and over 1,000 comments
shared, but our total engagement score
decreased by three points to 72 (2023/24: 75).
Employees voiced a desire for more visibility from
Group leaders and more frequent communication
about changes taking place across the
organisation, which has been incorporated into
our people plan.
Through the year we have seen some high scores
of over 80 around understanding and awareness
of our values and strategy, line manager trust,
valuing of different opinions and supporting
development and health and safety. The decrease
in overall engagement is attributed to greater
OUR VALUES
Our values help to set a clear expectation about
how it feels to work at RS, no matter what you
do or where you are. They were created with
the input of our people from across the globe.
Now we have one set of values that unite our
business and help to differentiate us as an
employer of choice. Each value is important on its
own, but they are even more powerful when used
together: we are one team, who deliver brilliantly,
doing the right thing, to make every day better.
Following the extensive, employee-led
development of our new values in 2023/24,
we have focused our efforts in 2024/25 on
embedding these values across the business.
Over a three-month rollout period from April to
June 2024, we held team workshops to familiarise
employees with our values and introduced a
new online values reflector tool for employees to
explore what the values mean to them. Our pulse
survey, conducted in June 2024, showed 87%
awareness of the values within the business.
In 2024/25, we launched a global recognition
programme, Spotlight, which enables
peer-to-peer recognition to make it easy to
show appreciation for colleagues who embody
our values.
In January 2025, we won the IC Brilliance Award
for Internal Communications Campaign for the
values rollout, reflecting the collaborative effort of
the entire business in shaping and championing
the new values. To embed the values for the long
term, we are now working on incorporating them
into key employee touchpoints and supporting
our leaders to continue championing our values
as a core part of the RS culture (see page 6).
uncertainty for our employees given the external
market conditions and general economic
environment combined with organisational
changes that have been implemented to make us
more efficient and agile as an organisation.
The pulse surveys strengthen our two-way
listening approach and encourage managers
to check in with their teams at regular touch
points. Each pulse survey includes the core
measures of the My Voice survey to act as a
temperature check of our progress towards
our original commitments, while evolving our
listening approach with a focus on specific topics.
In 2024/25, we have seen an increase in scores on
trust in line managers and understanding of the
Group strategy and a set of questions on health
and safety have set a crucial baseline for future
awareness initiatives (see page 60).
The pulse survey scores have been shared with
all employees, with targeted actions for line
managers to address any concerns raised by
the results and ensure we continue to address
the needs of our people quickly and effectively.
The pulse surveys are built on our core My Voice
survey which runs approximately every 18 months
and provides valuable insights from our global
team. The last My Voice survey was conducted in
2023/24 and the next is scheduled for 2025/26.
In 2024/25, we launched our first global Employer
Value Proposition ‘Go Beyond Amazing,’ to
enhance employee engagement and strengthen
the RS employer brand. Since launch, the
response has been powerful. We’ve seen a 106%
increase in organic search traffic and a 3.5% rise
in job applications – clear signs that our message
is resonating and our culture is attracting the
talent we need to thrive.
1. As at 31 March 2025, we were 7 points away from the global benchmark for the top 25% of high-performing companies.
RS Group plc Annual Report and Accounts 2025 57GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Social continued
DIVERSITY AND INCLUSION
By 2029/30, we want to ensure our team
reflects the customers, suppliers and
communities we serve and create an inclusive
and engaging environment where everyone
is proud and excited to come to work and can
perform at their best, develop and thrive.
% female leaders
37%
increase of 3% pts from 2023/24
% ethnically diverse leaders
1
10%
decrease of 1% pt from 2023/24
Inclusion for all
We aim to create an inclusive and dynamic
environment where all our people can perform at
their best, develop and thrive.
By promoting a culture of openness, respect and
belonging, we continue to attract and retain top
talent and harness a diverse range of strengths
and perspectives from across a broad global
talent pool. By embracing different perspectives
from a wider variety of characteristics, including
gender, sexual orientation, neurodivergence, age,
race, ethnicity, wellbeing and disability, we can
better adapt to the changing world, understand
and add value to our stakeholders and achieve
our strategic vision.
We are committed to being an equal opportunity
employer and supporting D&I within a global
context and in its broadest sense. We provide
under-represented and vulnerable employees
with the tools they need to succeed and feel a
sense of belonging.
Gender
We are committed to promoting gender diversity
across the Group to foster positive change within
the business and wider industrial sector.
Globally, our Group-wide gender split remains
balanced, with near equal numbers of men and
women across the organisation (2024/25: 48%
female; 52% male). At a senior leadership
level, our female leader population increased
by 3 percentage points in 2024/25 to 37%
(2023/24: 34%) and our female Executive
Committee (ExCo) population increased
by 6 percentage points in 2024/25 to 36%
(2023/24: 30%).
At Board level, composition increased to 60%
female Board members (2023/24: 56%), including
our Chair and Chief Financial Officer. As a result,
we ranked joint first place of FTSE 250 companies
for ‘Women on Boards’ in the 2025 FTSE Women
Leaders’ Review.
We continued to support, develop and promote
gender diversity across the Group in 2024/25.
Highlights include:
– Elevate: Our ERG for women, non-binary
and male allies brings together and supports
global members who are creating room to
talk and connect, raising suggestions to our
senior leaders and inspiring RS Group to
further action.
– Women Rising: We piloted the global Women
Rising programme with 28 women from March
to June 2024. The programme, which includes
over 200 women from various organisations
worldwide, aims to foster authenticity,
confidence and leadership skills.
– Women in Tech: This is a chapter within
our Elevate ERG that recognises the unique
challenges that women face working
in technology.
– Male Allies: We introduced this self-nominated
eight-week programme designed to raise
awareness around how male allies can
proactively effect change, challenge stereotypes
and better understand the challenges women
face in the workplace.
Our employee-led Employee Resource Groups
(ERGs) support colleagues in areas such as youth
(Bloomers), gender (Elevate), ethnicity (Embrace),
mental health, neurodivergence, disability and
wellbeing (LifeWorks) and sexual orientation and
LGBTIQIA+ (Spectrum). These ERGs actively run
events throughout the year to raise awareness
across the organisation. Furthermore, our Group
Head of D&I joined the UN Global Compact’s UK
Diversity, Equity and Inclusion Working Group in
2024/25, to share and learn with other businesses
on D&I-related challenges and opportunities.
We continue to review and evolve our work
to support the broad diversity of our senior
leadership team. During the year, the number
of senior leaders that are women increased to
37% (2023/24: 34%), while the percentage of our
leaders who are ethnically diverse decreased
to 10%¹ (2023/24: 11%). While we have made
progress in increasing the proportion of women
in our workforce, we have not achieved the
same momentum in increasing ethnically
diverse representation. We continue to evaluate
and address these challenges. Our external
disclosures relating to Board and senior
management are aligned to the Financial Conduct
Authority’s diversity and reporting requirements
(see pages 95 to 96).
While we acknowledge there’s still much to
achieve, we are committed to investing in our
people and becoming an inclusive employer
of choice. Read more about our diversity and
inclusion programmes, policies and progress on
our website: rsgroup.com/sustainability
We acknowledge the evolving D&I landscape
globally and are committed to inclusion, equal
opportunity and good practice in all the markets
we serve and emphasise that we always take a
‘best person for the job’ approach.
1. 97 of 139 senior managers self-reported ethnicity via the
employee database (including not specified/prefer not to say)
and 10 identified as non-white.
Ethnicity
We continue to work towards building a more
ethnically diverse leadership team reflective of
the wider communities in which we operate.
In 2024/25, 10% of our senior leaders identified
as ethnically diverse (2023/24: 11%).
Highlights in 2024/25 include:
– Talent acquisition: We broadened recruitment
efforts to attract the best talent for open roles,
including senior leadership, through clear job
descriptions, varied job boards and balanced
interview panels.
– Embrace: Our ERG for ethnically diverse
colleagues and allies brings together global
members who are working to create a safe
space to talk, listen and learn about race and
celebrate ethnic diversity.
– Mission Include: This is our cross-company
mentoring programme that empowers our
ethnically diverse and under-represented
colleagues by connecting them with leaders.
– Voluntary data collection: We continued
to collect data for senior roles in key
geographies and planned expansion of data
collection to all employees, in line with legal
restrictions. This informs better planning
and decision-making, helps us identify and
overcome recruitment and retention challenges
and supports accurate and transparent
self-disclosures in compliance with emerging
regulatory requirements.
As we move forward, we will continue to focus
on inclusion for all and prioritise the actions that
support the attraction, development, retention
and progression of all talent.
RS Group plc Annual Report and Accounts 202558
We continue to invest in emerging talent,
enabling them to accelerate their progression
into leadership roles. Our 2024/25 cohort
of 13 global Future Shapers developed their
self-leadership skills through the Ivy House
master programme, with support from a senior
leader mentor and a development conversation
with our ExCo. Future Shapers is now in its
sixth year with a total cohort of 53 employees.
All Future Shaper applicants have the opportunity
to join our Power Up programme. 78 of the 138
Future Shaper applicants completed Power Up
in 2024/25.
Capability
We continue to invest in our people through a
consistent global framework for learning and
development. Ensuring our employees can
develop, thrive and perform at their best requires
a broad mix of on-the job development activities,
learning opportunities and formal training.
In 2024/25, employees completed almost 35,000
hours of learning through our global learning
platform, My Academy, including both mandatory
and non-mandatory content. Local markets
have invested in live sessions, such as Espresso
Sessions in the UK and Ireland, DEALS (Drop
Everything and Learn) sessions in the US,
and Super Skills sessions for those early in
their careers.
Our approach to ensuring we have the right
capabilities in place is driven by our Talking
Performance process. Employees record and track
both performance objectives and development
objectives in our people system My Space, with
development goals tailored to either their current
role or preparation for a future role. This enables
a continuous focus on development.
In 2024/25, we supported 306 colleagues through
apprenticeships in the UK. We also achieved
Platinum membership to the 5% club for our
commitment to supporting employees through
‘earn and learn’ opportunities. RS provides
learning pathways such as change management,
data insight and artificial intelligence (AI).
We also launched a new entry-level opportunities
scheme, hiring 33 employees with limited work
experience into entry level roles supported by
Super Skills training delivered by our RS Youth and
Communities team (see page 62).
This year we added a new learning pathway, AI at
RS, offering four courses on practical and safe AI
use with c. 9,000 course completions in 2024/25.
REWARD AND RECOGNITION
In 2024/25, we introduced a refreshed reward
philosophy to inform how we approach reward,
including transparency and wellbeing at all stages
of the RS employment journey. This aligns to our
business strategy and enables us to attract and
retain employees, whilst motivating the right
behaviours and performance. We also launched
a global recognition programme, Spotlight, which
enables peer-to-peer recognition to make it easy
to show appreciation for colleagues who embody
our values.
In line with our reward philosophy, we continue
to provide market competitive rewards to attract
and retain the talent we need to drive business
performance. Our approach remains guided by
our global commitment to ensuring base pay
levels are set to pay a living wage and to offer
competitive bonuses to our people, as well as
long-term incentive plans to reward our senior
leaders. This is underpinned by a market-based
approach that aligns our benefits and rewards
packages to the local market norms and supports
our commitment to our values.
TALENT AND CAPABILITY
Talent
We operate in a competitive industry, which is why
we place strong emphasis on recruiting, retaining
and developing talent to unlock innovation and
drive our commercial success. In 2024/25, we
implemented a global Executive Talent Policy with
a common approach to assessing internal and
external candidates for senior leadership to the
highest standards. We applied more rigour to
our succession planning, culminating in an ExCo
succession and development review to increase
the rigour and development focus for ExCo
successors (see page 94).
Our approach continues to evolve to ensure
we are recruiting and developing the senior
leaders we require for the future. All leadership
recruitment and development is underpinned by
our Amazing Leaders framework, which clarifies
the behaviours we need in our leadership team
today and in the future.
Our leadership development approach continues
to be driven by regular individual career
conversations, supported by specific development
programmes, 360-degree feedback and
psychometric profiling to build self-awareness.
In 2024/25, based on the development and
succession review meetings, 215 people
managers were nominated for additional
development activities, such as Women Rising and
Influence with Impact.
35,000
learning hours completed
through My Academy in 2024/25
RS Group plc Annual Report and Accounts 2025 59GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Social continued
To reinforce our Target Zero programme and
ensure H&S is a fundamental part of how we do
the right thing, we have strengthened our focus
on creating a safety-first culture in 2024/25.
We reviewed safety training programmes to
ensure they were suitable for the full range of
work activities and shared key learnings across
the Group, encouraging increased hazard
spotting and individual ownership of near
miss reporting.
To promote our safety-first culture, key global
actions in 2024/25 included:
– Behaviour-based safety: We implemented a
Group H&S campaign requiring all employees
that conduct manual handling activities to be
observed while doing so, specifically focusing
on ergonomics in our distribution sites, such
as lifting and carrying in the appropriate way.
This allows us to give immediate feedback to
our employees and to coach them in real time,
which helps employees and leaders identify
and eliminate any behaviours that may result in
future incidents.
– Training, inspections and audits:
Employees completed close to 27,000 hours
of comprehensive H&S training aligned to best
practice. To promote individual ownership from
the top, we introduced a leadership inspection
form to be completed by all leaders travelling
to a new site. We also conducted H&S audits of
our largest distribution sites and we continue
to identify and target sites with higher accident
rates and work with them to develop action
plans which we monitor closely.
– Near miss reporting: Regular near miss
reporting campaigns encourage our people to
identify and report unsafe acts, hazards and
near misses. The total number of near misses
reported in 2024/25 increased by 12% per
head, which reflects a shared responsibility for
spotting, reporting and taking action to prevent
incidents occurring. Once reported, all near
misses are investigated to ensure corrective
and preventative actions are put in place and
where required shared with other sites across
the Group.
– Safety moments: We introduced over 170
safety moments – brief reminders covering
topics such as battery storage and employee
fatigue, to be shared at the start of Group team
meetings to embed a continuous conversation
of H&S risks.
To ensure consistency across our operations,
all of our sites have H&S management systems
in place, with 28 sites certified to ISO 45001 or
an equivalent standard, covering 57% of floor
area and 33% of our sites. We conduct health
and safety audits, assessments, induction, and
awareness training to any new acquisitions,
aligning our new sites and colleagues to
Group standards.
HEALTH AND SAFETY
By 2029/30, we aim for zero accidents involving
our people.
All accident frequency rate
(per 200,000 hours)
0.44
increase of 19% from 2023/24
12%
increase in reported near
misses per head in 2024/25
28
sites certified to ISO 45001
or an equivalent standard
In 2019/20, we set the ambition to reach zero
accidents involving our people by 2029/30.
To achieve this, our Target Zero programme
aims to implement measures that continuously
improve performance and prevent avoidable
incidents. Unfortunately, our progress towards
this target slowed in 2024/25 and our all accident
frequency rate per 200,000 hours increased by
19% to 0.44 (2023/24: 0.37) and the total number
of accidents across the Group increased to 37
(2023/24: 32).
Zero accidents resulted in fatalities, however one
accident resulted in a life-changing injury. This is
extremely upsetting and a full investigation is
currently in progress to understand the events
surrounding the incident and how we can learn
from this going forward.
Our performance
Change from 2024 2025 2024 2023
All accidents +16% 37 32 33
All accident frequency rate (per 200,000 hours) +19% 0.44 0.37 0.41
Lost time accidents +53% 26 17 22
Lost time accident frequency rate (per 200,000 hours) +63% 0.31 0.19 0.27
Total calendar days lost +59% 481 302 516
Near misses reported +10% 22,000 20,000 17,000
Near misses per head
1
+12% 2.51 2.25 1.99
1. Prior year figures have been restated to incorporate enhancements in data capture and reporting methodologies.
For additional health and safety data, including how we are supporting mental health and wellbeing,
please visit our ESG data centre: rsgroup.com/sustainability
Wellbeing
We support the wellbeing of all our people in
collaboration with our health and safety teams.
We have established several wellbeing rooms
around the globe where employees can find quiet
space to meditate, unwind, or call a healthcare
professional if required. Through our LifeWorks
ERG, employees are encouraged to drive the
conversation around breaking down the stigma
surrounding mental health and wellbeing,
disability, neurodivergence and financial
wellbeing. All employees have access to our
Global Benefits platform which enables support
under physical, financial and social and emotional
pillars with offerings tailored to an employee’s
region and benefits package.
RS Group plc Annual Report and Accounts 202560
2030 AMBITIONS METRICS ACTIONS STATUS READ MORE
Championing youth and education
Inspiring future engineers
and innovators:
Support one million young
people with educational
technologies, learning
content and skills
development opportunities
913,000
young engineers and
students supported
since 2020/21
– Partnered with c. 5,200 educational institutions to support future
engineers and innovators
– Expanded the RS Student Project Fund from the UK, Spain and South
Africa to additional markets within the EMEA region, providing RS
products for innovative and diverse projects
– Delivered over 40 free Super Skills sessions to enhance employability
skills and strengthen the industry talent pipeline
+ See page 62
rsgroup.com/
sustainability
Supporting our communities
Social impact partnerships:
Support our social impact
partners to use engineering
and technology to improve
lives – including supporting
TWMP to help 100,000 people
in need
46,000
lives improved
through TWMP since
2020/21
– 20 projects supported across nine countries, including Mexico,
Greece, Gaza and Uganda
+ See page 63
£963,000
raised for TWMP since
2020/21
– Raised over £300k for TWMP Foundation through fundraising
activities, employee donations and matched-giving
Volunteering:
Inspire 50% of colleagues to
volunteer to support their
communities and build new
skills
30%
of employees have
volunteered in the last
two years
– Over 400 RS employees volunteered to build 126 flatpack washing
machines for global communities
– Regional team volunteer days included community gardening,
painting a paediatric hospital and collecting clothing and food
donations for communities in need
+ See page 63
Status key:
Each of our actions are broken down into annual
targets that need to be met to remain on track to
achieve our 2025 and 2030 goals. The key below
reflects our current position:
On track or ahead
Slightly behind target – monitor closely
Not on track – further action required
More information is available
in our full ESG scorecard:
rsgroup.com/sustainability
It is essential that we inspire the next generation
of industrial engineers and innovators to ensure
we have the right skills to thrive in the future.
By providing educational products, inspirational
learning content and immersive skills
development opportunities, we help young
engineers and technologists embark on exciting
future careers.
We also support our communities to improve
people’s lives and inspire future generations,
while creating a more sustainable world. We do
this by enabling and empowering our people
to make a meaningful difference in their local
communities through our local giving fund and
two paid days to volunteer every year.
CHAMPIONING
YOUTH &
COMMUNITIES
RS Group plc Annual Report and Accounts 2025 61FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORTSTRATEGIC REPORT
What we do
Our skills development programme
enhances professional and employability
skills for young engineers and innovators.
Key actions in 2024/25
– Delivered over 40 free Super Skills
sessions on 12 topics to over 600
young people, fostering confidence,
building employability skills and
bridging the gap between university
and the workplace. This included a
‘present like a pro’ session run by an
RS Youth and Community Ambassador
for over 100 students across four
universities in Malaysia
EMPLOYABILITY SKILLS
INSPIRING FUTURE ENGINEERS
AND INNOVATORS
By 2029/30, we want to support one million
young people with educational technologies,
learning content and skills development
opportunities to support future engineers
and innovators.
Number of young engineers
and innovators supported
913,000
increase of 117,000 young
people from 2023/24
We inspire young people to pursue technology
and engineering-based careers, helping them
to develop vital technical and employability skills
that will positively impact global industry, society
and the environment. Through our partnerships
with c. 5,200 educational institutions and our
skills development programme we help future
engineers and innovators to apply their technical
knowledge and pursue careers in the field.
Our skills development programme is part
of our strategy to become first choice for all
our stakeholders. Supporting young people’s
skills development helps RS and the wider
industry attract and retain young talent with a
future-focused skillset. Furthermore, showing
young engineers and innovators that we are by
their side during their education and early career
builds brand advocacy and lifetime loyalty with
future customers.
CHAMPIONING YOUTH
& EDUCATION
Key actions delivered in 2024/25 across the three pillars of our education programme:
What we do
We run a series of initiatives to provide
students with opportunities to apply their
technical knowledge.
Key actions in 2024/25
– Expanded the RS Student Project Fund
to additional markets within EMEA,
providing RS products for innovative
and diverse projects
– Continued to provide access to
design resources and innovation
tools through our DesignSpark
community of 1.4 million students,
educators and innovators, growing the
under-25 membership by 16%
to 516,000 (2023/24: 445,000)
PRACTICAL EXPERIENCE
What we do
We support initiatives aimed at
increasing inclusion and supporting
under-represented groups in science,
technology, engineering and maths
(STEM) subjects and careers.
Key actions in 2024/25
– Hosted a STEM-outreach initiative
in collaboration with the University
of Cape Town, South Africa, engaging
over 50 high school students in
hands-on learning experiences,
including Micro:bit workshops on
drone and hovercraft technology
– Ran a series of robotics, gaming, coding
and basic electronics workshops in
partnership with GirlTech for over
230 children in Italy
STEM INCLUSION
Social continued
RS Group plc Annual Report and Accounts 202562
Key actions in 2024/25:
TWMP highlights:
– Raised over £300,000 for TWMP Foundation
during the year through fundraising, matched-
giving and corporate donations (£963,000
raised since 2020/21)
– Since the formation of our partnership, TWMP
has distributed 486 machines, supporting over
46,000 lives through 21 projects in 13 countries
EWB-UK highlights:
– Sponsored EWB-I’s Engineering for People
Design Challenge in the UK, Ireland, US, South
Africa and Cameroon, giving 13,300 students
the opportunity to design sustainable solutions
that tackle community development challenges
VOLUNTEERING
By 2029/30, we want to inspire 50% of
colleagues to volunteer to support their
communities and build new skills.
% of employees who have
volunteered in the last two years
30%
increase of 7% pts from 2023/24
In 2024/25, we encouraged our people to use
their two annual days of paid volunteering leave
for community-based initiatives and good causes.
Volunteering activities included supporting
communities, developing skills, improving
engagement and boosting health and wellbeing.
The number of employees using their
volunteering days increased to 30% over the last
two years (2023/24: 23%). In total, employees
donated 1,840 days to support local causes or our
social impact partners.
Key actions in 2024/25:
– Over 400 RS employees volunteered with
TWMP to build 126 flatpack washing machines
for communities in Mexico, Greece, Gaza
and Uganda
– Teams supported their communities by planting
trees, cleaning a community garden, painting a
paediatric hospital and collecting clothing and
food donations
While volunteering participation is increasing, we
still have work to do to ensure that 50% of our
people are using their annual volunteering days
to support community causes. During the roll out
of our new values and behaviours in 2024/25, we
promoted volunteering as an example of doing
the right thing and working together to make
every day better.
For more on how we champion youth and
communities, go to: rsgroup.com/sustainability
SUPPORTING OUR
COMMUNITIES
We empower and enable our people
to support communities through
our global social impact partnership,
local giving fund and volunteering.
SOCIAL IMPACT PARTNERSHIPS
By 2029/30, we want to support our social
impact partners to develop solutions that
improve lives, including supporting TWMP to
help 100,000 people in need.
Number of lives improved
through TWMP since 2020/21
46,000
increase of 15,000 lives from 2023/24
To be a force for good in communities worldwide,
we support social impact partners that develop
solutions to improve lives, solve global challenges
and create a more sustainable world.
Since 2020/21, we have provided financial and
volunteering support to two primary partnerships:
– The Washing Machine Project (TWMP)
provides displaced and low-income
communities with an accessible, off-grid
washing machine solution that does not require
a direct power supply, which has improved the
lives of over 46,000 people to date
– Engineers Without Borders UK (EWB-UK)
works across the globe to put sustainability at
the heart of engineering
SUPPORTING LOCAL
COMMUNITIES
We know the importance of making a positive
impact in our local communities. That is why we
empower our people to champion the causes
closest to their hearts in the communities where
we live and work. Whether it is through financial
support, volunteering, or both, we want to help
our teams make a difference.
In 2024/25, we established a network of regional
champions and committees worldwide to enable
employees to support charities and initiatives
that make a difference in the local communities in
which we operate. This localised approach gives
each region and country within RS the flexibility
to build meaningful relationships with local
organisations that matter most to our people
and communities.
Following the devastating wildfires across
California, US, in January 2025, we set up an
emergency response fund, donating just under
£10,000 to the American Red Cross and £6,000
to the Los Angeles Wildfires & Disaster Recovery
Wildlife Fund in support of our sales teams and
customer base in the region.
Additionally, following the earthquake to hit
Thailand and Myanmar in March 2025, we
donated £15,000 to support the Thai Red Cross
emergency response.
In 2024/25, we donated
£142,000
to local charity and community initiatives
worldwide, supported by our employees
RS Group plc Annual Report and Accounts 2025 63GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
2030 AMBITIONS PERFORMANCE ACTIONS STATUS READ MORE
Responsible business:
ESG-related targets included in our
employee rewards’ programme across all
levels and geographies
48%
of employees had their annual
incentive aligned to Group
carbon reduction in 2024/25
– 48% of employees were incentivised to achieve
Scope 1 and 2 emissions reduction goals in
2024/25, with a carbon metric accounting for 10%
to 15% of the Group’s annual incentive
+ See page 66
rsgroup.com/
sustainability
Responsible supply chain: Evaluate
our suppliers against our high ethical
and environmental standards and set
ESG objectives for strategic suppliers
64%
of suppliers by spend with
signed Ethical Trading
Declaration
– ESG introduced as the eighth pillar of our EMEA
strategic supplier approach
– Updated ESG Supplier Handbook and created a
supplier video to engage on material ESG topics
– Engaged with over 110 suppliers to develop
more sustainable products for the Better World
product range
+ See page 67
55%
of suppliers by spend with an
EcoVadis rating
75%
of RS PRO suppliers by spend
with a Sedex membership
Status key:
Each of our actions are broken down into annual targets that need
to be met to remain on track to achieve our 2025 and 2030 goals.
The key below reflects our current position:
On track or ahead
Slightly behind target – monitor closely
Not on track – further action required
More information is available
in our full ESG scorecard:
rsgroup.com/sustainability
DOING
BUSINESS
RESPONSIBLY
Governance
Our commitment to doing the right thing
underpins everything we do and ensures we
remain a trusted and transparent partner.
We adopt a strong approach to governance,
ethics and compliance both within our
business and across our value chain.
By actively collaborating with our 2,500+
product suppliers, we ensure that our 800,000
strong product range comes from responsible
businesses that share our high ethical and
environmental standards.
RS Group plc Annual Report and Accounts 2025 64
ESG GOVERNANCE STRUCTURE
Audit Committee
Remuneration Committee
The Board
Oversees the Group’s ESG approach and receives
regular updates on ESG action plan progress
Executive Committee (ExCo)
Oversees development and implementation of
the Group’s ESG strategy, policies, investment
plans, delivery initiatives and disclosures
ESG team
Ensures operational delivery of the
Group’s ESG action plan
ESG compliance steering group
Ensures compliance to existing
and emerging ESG regulation
Initiative steering groups
Comprised of four steering groups that drive
action on key ESG action plan areas: Net zero,
packaging, transport and Better World products
ESG Non‑Executive
Director
ESG GOVERNANCE
The ExCo, led by our CEO, has ultimate
responsibility for the development, delivery
and progress of our 2030 ESG action plan.
They oversee the development, implementation
and performance management of our 2030
ESG action plan and all related policies, goals,
initiatives, investments and disclosures.
The ExCo receives a quarterly update on our ESG
performance and has two dedicated ESG sessions
per year to review strategy, investment planning
and performance as part of our organisational
business review and management process.
This includes an overview of our climate transition
plan and performance to ensure we are taking
appropriate action on the Group’s key climate-
related risks and opportunities.
This is supplemented with ad-hoc briefings
and updates on the latest ESG regulations and
other developments.
To learn from peers and gain strategic insight
on some of our most material ESG topics, in
2024/25 members of the ESG and D&I teams
joined the UN Global Compact’s (UNGC) UK
Working Groups on Sustainability Reporting,
Circular Economy, Climate Peer Learning and
Diversity, Equity and Inclusion.
Our ESG disclosures are aligned to the following
frameworks and standards:
– TCFD: In 2024/25, we refreshed our
quantitative scenario analysis for our five
CRROs and broadened our governance, risk
management controls and engagement (see
pages 68 to 73).
– GRI and SASB: Our ESG reporting aligns to the
sector-specific recommendations of the Global
Reporting Initiative (GRI) and Sustainability
Accounting Standards Board (SASB).
– UNGC: We are members of the UNGC, and
our latest Communication on Progress
can be found on our website. In 2024/25,
we joined four UNGC working groups as
referenced above.
– UN Sustainable Development Goals (SDGs):
Our ESG action plan is aligned to six of the UN
SDGs where we can make the biggest impact.
AWARDS AND RECOGNITION
In 2024/25, we were included in CDP’s
prestigious A-list, having improved our
CDP rating this year from A- to A for our
commitment to climate action, environmental
transparency and disclosure. We were
ranked 81
st
in TIME Magazine’s World’s Most
Sustainable Companies and were listed in
the S&P Global Sustainability Yearbook for
the second time, placing us in the top 15%
of companies in our industry for ESG action.
We also maintained our Platinum EcoVadis
Medal for the third consecutive year.
You can read more on our website:
rsgroup.com/sustainability
During the year, six ExCo members participated
in one-to-one interviews to support our revised
double materiality assessment. More information
on this process is available in our 2025
ESG Report.
The Board has close oversight of our ESG action
plan, including our five climate-related risks
and opportunities (CRROs) and ratifies key ESG
policies, targets, initiatives and investments while
monitoring ESG progress via regular updates.
In addition to an annual deep dive into ESG
strategy, investment plans and performance,
they receive a progress update ahead of each
Board meeting via the CEO Board report and
the Chief Sustainability Officer (CSO) provides a
verbal update to Non-Executive Director ESG lead,
Bessie Lee.
In respect of ESG, the Board is supported by two
of its committees: the Audit Committee, who
ensure alignment to existing and emerging ESG
compliance and the Remuneration Committee,
who make decisions on ESG metrics and targets
to be included in executive remuneration and
employee rewards.
The Group ESG team is responsible for the day-
to-day delivery of our ESG action plan. In 2024/25,
the team moved into the corporate services
function, reflecting how strong governance
underpins ESG strategy and delivery while
enabling the business to deliver greater value
for our stakeholders. Led by our CSO, the team
is supported by cross-organisational steering
groups focused on the key areas of our ESG
action plan: net zero, packaging, transport, Better
World products and supplier ESG. These teams
meet regularly to develop strategic and
investment plans, oversee initiative delivery and
manage ongoing performance.
They are supported by our ESG compliance
steering group, with senior members from
finance, risk, legal, compliance and ESG working
closely with our functions and markets to
address our risks and opportunities under TCFD
and the European Sustainability Reporting
Standards (ESRS), CSRD and Corporate
Sustainability Due Diligence Directive (CSDDD).
REPORTING AND DISCLOSURE
To ensure our ESG disclosures meet the evolving
needs of our stakeholders, we continued to align
our reporting to key frameworks, ratings and
standards. Our ESG data centre includes up
to five years of environmental data and our
climate-related KPIs. We also provide a separate
ESG Basis of Reporting document which outlines
the reporting methodology for key ESG KPIs.
Assurance of our ESG data from ERM CVS can
be found on pages 74 and 75.
The Group ESG team closely monitors the rapid
evolution of the ESG regulatory landscape to
develop a best practice alignment approach
to the latest standards and emerging UK and
EU regulations.
RS Group plc Annual Report and Accounts 2025 65GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Governance continued
INCENTIVISING ESG PROGRESS
By 2029/30, we want to include ESG-related
targets in our employee rewards programme
across all levels and geographies.
ESG metrics in Group
performance scorecard
8
unchanged from 2023/24
% of employees with carbon reduction
metric in annual incentive
48%
3% pts increase from 2023/24
To drive progress towards our 2030 ESG action
plan, we have integrated ESG targets into our
employee rewards programme. As of 2024/25,
48% of Group employees have their annual
incentive aligned to the Group’s Scope 1 and
2 emissions reduction target, with this metric
accounting for between 10% and 15% of the
annual incentive. In 2024/25, we exceeded the
maximum performance level for this metric.
In addition to these incentives, ESG forms a core
part of our performance management at both
a Group and individual level. The ExCo receives
ESG performance updates quarterly. We also
have eight non-financial KPIs in our Group
performance scorecard which the ExCo uses
to manage ESG performance via QBRs with the
regions and functions. Specific individuals and
teams have ESG targets in their annual objectives
and incentive structures to drive further progress.
ETHICS AND COMPLIANCE
We are committed to upholding the highest
standards of ethics and compliance across the
Group and ask our suppliers to do the same.
To ensure consistent action, our key policies
and processes align to regional legislative
requirements and best practice standards,
including the policies and processes described
below and on page 76.
Code of Conduct
The Code of Conduct sets out our policy to
maintain the highest standards of ethical
conduct and behaviour. It provides clarity to our
employees, contractors and others as to the legal
and compliance requirements we must adhere to,
as well as ways of raising concerns including via
our Speak Up process (see page 102).
Compliance with the Code of Conduct is
required for employees, reinforced by training
delivered to our top 178 senior leaders and an
email awareness campaign for all employees.
Our values rollout in 2024/25 has strengthened
our corporate culture and brought a greater
degree of purpose and meaning to living the
Code of Conduct, ensuring that we maintain
the integrity and reputation of our business by
always doing the right thing. The Code of Conduct
is periodically refreshed to ensure it continues
to reflect best practice and reinforce our
commitment to achieving the highest ethical and
compliance standards across the Group.
Ethical trading
We continue to promote ethical standards for our
people through the Code of Conduct and for our
suppliers through our Procurement Policy and
Ethical Trading Policy.
We are committed to partnering with suppliers
with strong ESG standards. We ask all our product
and service suppliers to sign our Ethical Trading
Declaration, or provide their own equivalent
ethical policy that aligns to our standards. As of
2024/25, 64% of suppliers by spend had signed
our Ethical Trading Declaration or provided
their own.
Anti‑bribery and corruption
We are committed to conducting our business
affairs ethically and transparently, ensuring we do
not engage in or facilitate any forms of bribery or
corruption as outlined in UNGC Principle 10.
Our Anti-Bribery and Corruption Policy sets out
this commitment alongside our approach to
gifts and hospitality, facilitation payments and
political and charitable contributions. This policy
and related controls are detailed in our Code of
Conduct training and are available in 12 Group
languages on our intranet sites and via our legal
and compliance chatbot. In 2024/25, 100% of
our senior leaders completed Code of Conduct
training, which included a particular emphasis on
anti-bribery and corruption. An email awareness
campaign was carried out to all employees at the
same time.
Whistleblowing
Speak Up, our dedicated whistleblowing
process, is a way for employees, customers and
suppliers to raise concerns regarding ethical
or legal concerns without fear of victimisation.
Available globally, we provide internal channels
and an external independent reporting service
that can be used to make reports anonymously.
The Speak Up process is monitored regularly
by our Audit Committee and in 2024/25, we
received 38 Speak Up reports, all of which were
investigated and acted upon where necessary.
The Speak Up Policy was refreshed during the
year, with an awareness campaign to encourage
employees to report concerns and the addition
of eight new local language whistleblowing
telephone lines.
Modern slavery
Our Modern Slavery Transparency Statement
outlines our zero-tolerance stance towards
any form of slavery, human trafficking, child or
forced labour within any part of our business or
supply chain. This position is reinforced in our
Anti-Slavery and Human Trafficking Policy and
Ethical Trading Policy.
We comply fully with the International Labour
Organization (ILO) Forced Labour Convention and
Abolition of Forced Labour Convention and the
ILO’s Minimum Age Convention. In 2024/25, 100%
of our senior leaders undertook modern slavery
training as part of our Code of Conduct training.
Data, information security
and privacy
We continue to operate a robust information
security programme, central to which is our
Information Security Policy that is aligned to the
principles of the National Institute of Standards
and Technology Cybersecurity Framework and ISO
27001. We recognise and respect the high level
of trust our customers, suppliers and employees
place in us. This is why we continue to maintain
a strong focus on data, privacy and information
security, as key mitigations to cyber security as
a principal risk for the Group. We also published
a Data Incidents Policy and an AI Policy which is
being translated for global distribution.
We assess the different parts of our business for
risks associated with handling personal data and
provide in-depth training tailored to the audiences
in the parts of the business with a higher risk
related to personal data. 99% of our employees
in those higher risk areas have completed Data
Protection training in 2024/25.
In 2024/25, we enhanced email security through
more frequent, targeted phishing simulations,
tuning technology to detect some of the more
sophisticated threats that we are beginning to
experience and utilising AI prediction to filter
and handle attacks. Our primary objective is to
increase awareness and to assess individuals
based on their ability to identify and report
simulated phishing attempts.
For a full list of Group codes, policies and
standards, go to: rsgroup.com/sustainability/
codes‑policies‑and‑standards
RS Group plc Annual Report and Accounts 202566
Supplier ESG action plan
As a global organisation at the centre of the
industrial value chain, it is important that
we leverage our leadership position to drive
responsible action among our suppliers on
behalf of our customers. We recognise that our
2,500+ suppliers are at different stages of their
sustainability journey, which is why we share our
ESG insights and knowledge, as well as our strong
responsible business principles to ensure that
good practices are upheld across our value chain.
By doing so, we are forging stronger relationships
and accelerating consistent actions to reduce risk
and increase trust among our customers.
By 2030, we aim to engage our top 67% of
suppliers by spend (c. 400 suppliers) and all RS
PRO suppliers (c. 670 suppliers) on four ESG
priorities outlined in our ESG Supplier Handbook.
As of 2024/25, we have achieved the following:
1. Sign and return the Ethical Trading
Declaration: 64% of suppliers by spend with
a signed Ethical Trading Declaration in place
(2023/24: 59%)
2. Develop and offer more sustainable
products: 44 new suppliers and 2,600 new
products were added to the Better World
product range, which totals c. 30,000 products
from 132 suppliers (2023/24: 30,000 products
from 90+ suppliers) (see page 54)
3. Set science‑based carbon reduction
targets by 2025: 38% of suppliers have set
science-based climate goals through the
SBTi. In addition to working with suppliers, in
2025/26 we will engage with SBTi to identify an
appropriate future target
4. Become EcoVadis‑rated or Sedex
members: 55% of suppliers by spend are
rated by EcoVadis (2023/24: 52%). Not only
has participation increased, but suppliers
have maintained their average silver medal
in 2024/25. 75% of RS PRO suppliers are
members with Sedex (2023/24: 66%)
RESPONSIBLE SUPPLY CHAIN
By 2029/30, we want to evaluate all our
suppliers against our high ethical and
environmental standards and set ESG
objectives for strategic suppliers.
Suppliers with signed Ethical
Training Declaration
64%
5% pts increase from 2023/24
Suppliers with EcoVadis rating
55%
3% pts increase from 2023/24
Suppliers committed to SBTi
38%
6% pts increase from 2023/24
RS PRO suppliers that are Sedex members
75%
9% pts increase from 2023/24
Our supplier management approach is based
on rigorous screening, collaboration and
regular direct engagement with our suppliers.
Each supplier-facing team is coached on our
supplier ESG action plan to drive productive
conversations that prioritise sustainability.
We support our suppliers to progress
sustainability opportunities and overcome
challenges by providing educational toolkits, such
as our ESG Supplier Handbook and Better World
Product Guidelines. We facilitate sharing and
learning through webinars and industry events
and regularly review ESG progress in individual
supplier meetings. This year, we made ESG the
eighth pillar of our EMEA strategic approach to
drive action across the value chain in sustainable
products, carbon reductions and broader
ESG standards.
ESG was a core part of the agenda for the
EMEA strategic supplier annual conference and
RS Connect events in US, UK and Scandinavia,
where we hosted panel sessions covering topics
such as our ESG action plan, Better World
product range, sustainable distribution and our
youth programme.
Through these events, we aim to drive
deeper collaboration between suppliers and
customers to accelerate sustainable and circular
business models and create stronger, more
strategic partnerships.
132
suppliers contribute to our Better World
product range
We continued to conduct detailed ethics and
compliance monitoring with our key suppliers to
ensure ongoing alignment to Group standards
and expectations. This included:
– Risk screening all existing suppliers against
global government lists and conducting more
in-depth ethics and compliance checks on our
higher-risk RS PRO suppliers. In 2024/25, we
conducted 57 site audits of these suppliers.
– In addition to the mandatory pre-qualification
questionnaire as part of our supplier
onboarding process, in 2024/25 we ran our
second re-qualification trial targeting specific
product categories as additional due diligence
to ensure products contain responsibly
sourced minerals.
More information on our supplier ESG action
plan can be found online at: rsgroup.com/
sustainability
RS Group plc Annual Report and Accounts 2025 67GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
TCFD
TASK FORCE ON
CLIMATE-RELATED
FINANCIAL DISCLOSURES
Climate change is one of the greatest challenges
facing our world today and requires global
co-operation and accountability. As a Group, we
take our responsibility under the Paris Agreement
seriously and remain committed to driving climate
action across our own operations and value
chain by collaborating with our customers and
suppliers. This is not only the right thing to do
for people and planet, but core to our purpose
of making amazing happen for a better world
and our strategy, which is focused on delivering
sustainable value for all our stakeholders.
We remain committed to communicating our
progress on climate action in an engaging and
transparent way. This is the fourth year we have
published a TCFD report and we continue to make
good progress against the 11 recommendations.
We have reviewed and strengthened our
quantitative scenario analysis for our five climate-
related risks and opportunities (CRROs) and
broadened our governance, risk management
controls and engagement. Additionally, we
have continued to integrate climate and ESG
priorities into our products, solutions, target
customer industries and operational capabilities.
Our approach enables us to mitigate our risks,
while leveraging the opportunities to support our
long-term sustainable growth and stakeholder
value creation by supporting the transition to a
low-carbon global industrial sector.
At the time of publication, we have aligned with the requirements of Listing Rule 6.6.6R and the Companies
(Strategic Report) (Climate-related Financial Disclosure) Regulations 2022 by including climate-related
financial disclosures that are consistent with the 11 TCFD recommendations.
Where possible, we have made use of the TCFD Final Recommendations Report and Annexes (2021) and technical
supplements for our quantitative climate scenario analysis. We will continue to use these resources to strengthen
our disclosures in preparation for the International Financial Reporting Standards S2 (climate standard) and the UK
Transition Plan Taskforce disclosure framework, including the development of our first climate transition plan.
The table below sets out the 11 TCFD recommendations and where the related information can be found within this report:
Recommendations Disclosure Reference
Governance A) Describe the Board’s oversight of climate-related risks and opportunities Doing business responsibly (page 65)
B) Management’s role in assessing and managing climate-related risks and
opportunities
Doing business responsibly (page 65)
Strategy A) Describe the climate-related risks and opportunities the organisation has
identified over the short, medium and long term
TCFD strategy (pages 69 to 73)
B) Describe the impact of climate-related risks and opportunities on the
organisation’s businesses, strategy and financial planning
TCFD strategy (pages 69 to 73)
C) Describe the resilience of the organisation’s strategy, taking into consideration
different climate-related scenarios, including a 2°C or lower scenario
TCFD strategy (pages 69 to 73)
Risk management A) Describe the organisation’s processes for identifying and assessing
climate-related risks
TCFD risk management (page 73) /Risks,
viability and going concern (page 42)
B) Describe the organisation’s processes for managing climate-related risks TCFD risk management (page 73) /Risks,
viability and going concern (page 42)
C) Describe how processes for identifying, assessing and managing
climate-related risks are integrated into the organisation’s overall risk
management
TCFD risk management (page 73) /Risks,
viability and going concern (page 42)
Metrics and targets A) Disclose the metrics used by the organisation to assess climate-related risks
and opportunities in line with its strategy and risk management process
Advancing sustainability (pages 48 to 55)/
TCFD metrics and targets (page 73)
B) Disclose Scope 1, Scope 2 and if appropriate Scope 3 GHG emissions and the
related risks
Advancing sustainability (pages 50 and 51)
C) Describe the targets used by the organisation to manage climate-related risks
and opportunities and performance against targets
Advancing sustainability (pages 48 and 49)
RS Group plc Annual Report and Accounts 202568
Our five CRROs are summarised in the table on
this page and further detail can be found on
pages 70 and 71. These remain consistent with
our assessment and disclosure in prior TCFD
reports (available at: rsgroup.com/sustainability/
reporting-centre), which set out further
complementary detail and context on our climate
governance and risk management approach and
our climate-related scenario analysis.
Governance
Our climate governance activities are fully
integrated within our wider corporate
governance. For an overview of our ESG
governance arrangements and key activities
for 2024/25, inclusive of climate risks and
opportunities, refer to page 65. For an update on
key ExCo and Board climate-related engagement
and activities in 2024/25, please see pages 86
to 88.
In 2024/25, we refreshed our double materiality
assessment (DMA) in line with CSRD requirements.
This process was pre-assured by our financial
auditor, who evaluated the underlying process
to enable effective assurance. The DMA process
reinforced that our five CRROs are material,
have the correct level of management focus and
are supported by appropriate policies, actions,
metrics and targets. Results of our DMA can be
found on page 46.
Strategy
Driving climate action and accountability
through our business strategy
Climate action is core to our purpose, vision and
values, our business strategy and 2030 ESG action
plan. We have a focused strategy and aligned
ESG action plan to help us accelerate delivery.
Some key examples of how we are mitigating
climate risks and maximising opportunities
through our strategy include:
Products, solutions and customers
1. Changes in customer segments and product
demand (transition opportunity)
– Customers: offering our customers products
with more sustainable features and sustainable
service solutions; developing and retaining
customers in industry sectors that are critical to
the low-carbon transition, including renewables,
utilities and automotive sectors (see page 55)
– Products and suppliers: working with our
suppliers to build an industry standard and
claims verification process to promote their
sustainable products to customers, enabling
customers to reduce their energy consumption
and transition to lower-carbon operations (see
page 54)
– Solutions: helping our customers run their
businesses more sustainably, via solutions such
as energy monitoring and air quality surveys
(see page 55)
– Operational excellence: reducing emissions
from our distribution site operations and
product shipments (see pages 22 and 48 to 53)
We are engaging with our suppliers, customers
and wider value chain partners to drive
collaborative action for a low-carbon global
industrial sector, for example, through our Better
World product range and supplier ESG action
plan (see pages 54 and 67). Our commitment
and progress on ESG is a key differentiator in
attracting and retaining high-value customers.
Alongside this, we have developed an initial
draft of our climate transition plan, utilising
the Transition Plan Taskforce (TPT) Framework
released in 2023, which has been shared with the
ExCo and Board. We will look to publish this in line
with developing compliance timelines.
Strengthening our approach to climate
scenario analysis
In 2024/25, we reviewed and validated our
quantitative climate scenario analysis. Our ESG
and Group financial control teams worked
together to update our climate scenario analysis
on the basis of a revised five-year plan and
projected out to 2050. This has helped to bring
greater visibility and control over the potential
financial impact of our CRROs and demonstrates
our commitment to embedding climate action
across our business.
We have modelled the potential impact on
Group adjusted operating profit (pre- and
post-mitigation). On page 72 we have presented
the residual impact after mitigation of the
CRROs under three different climate scenarios
from the International Energy Agency (IEA) for
transition risk and under three Intergovernmental
Panel on Climate Change (IPCC) Representative
Concentration Pathways (RCPs) for physical risk,
which is consistent with our previous analyses
(see reference table on page 72).
We identified the likely timeframe for each CRRO
to emerge:
– Short term: 0 to 5 years (aligned to our five-
year strategic plan)
– Medium term: 5 to 10 years (aligned to the risk
management process, modelled as 2030 in our
quantitative climate scenario analysis)
– Long term: 10 to 30 years (aligned to the risk
management process, modelled as 2050 in our
quantitative climate scenario analysis)
While we have identified short-term climate
opportunities, we have not identified any material
short-term risks or experienced any climate-
related incidents with a material impact on the
business in 2024/25. We have modelled our
medium and long-term CRROs in the table on
page 72.
OUR FIVE CRROs
Logistics
2. Technology transition and rising fuel costs (transition risk)
Distribution sites
3. Reduced emissions and energy costs through solar
generation (transition opportunity)
4. Impact of extreme heat (physical risk)
5. Impact of extreme weather (physical risk)
RS Group plc Annual Report and Accounts 2025 69GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Strategic action Stakeholder key
Customers Products and suppliers Solutions Experience Operational excellence
Our people Customers Suppliers Communities Shareholders
2024/25 actions on our CRROs:
CRRO Description Business owners Metrics monitored 2024/25 initiatives, progress and investment activities
Transition
Opportunity
1. Products, solutions and
customers: Changes in
customer segments and
product demand
Strategic action
alignment:
Connected stakeholders:
Growth in customer segments
linked to the low-carbon
economy and product categories
enabling the net zero transition
A smaller downside risk of
decline in traditional customer
segments (fossil fuel) and
products that are not prevalent
in the low-carbon economy
(although modelling indicates
this is of low significance)
Products: Chief of
Product and Supply
Chain (P&SC)
Solutions: President
Americas
– Number of products in the Better
World product range (ambition for
100,000 by 2030)
– Investment in and incremental
revenue from sustainable products
and services e.g. Better World
products, industrial MRO services
that reduce energy and carbon,
and low-carbon industry sectors
– Overall green revenues metric
to be developed, aligned to EU
Taxonomy guidance
– Better World products – c. 30,000 products from 345 product
families launched in 30 countries, with 132 suppliers contributing to
the range (see page 54)
– Low-carbon industry sectors – identified 10 strategy suppliers and
expanded our catalogue to include around 200 initial product lines
to develop bespoke wind turbine spares’ catalogues. (see page 55)
– New sustainability solutions to help customers monitor and reduce
energy in their operations (see page 55)
2025/26 focus: Continue to grow our customer propositions and
revenue from sustainable products, service solutions and industries
Risk
2. Logistics: Technology
transition and rising fuel
costs
Strategic action
alignment:
Connected stakeholders:
Increased costs from third-party
logistics providers associated
with carbon freight taxes and
investment in low-carbon
technologies (expected to
continue to be embedded in
pricing margin)
Chief of P&SC and
Regional Presidents
(RPs)
– Reduction in total CO
2
emissions
and emissions intensity for product
transportation – 35% reduction per
tonne of product sold by 2029/30
from 2019/20
– Logistics costs as a percentage
of revenue
– 16% reduction in absolute carbon emissions from product
transportation since 2019/2020¹, delivered via ongoing initiatives
to regionalise and optimise our supply chain and switch transport
modes (see pages 49 to 51)
– RS Safety Solutions transitioning to HVO fuel for its HGV logistics
fleet in the UK (see page 49)
– Reset 2030 product transport emissions intensity target to 35%²
(previously 25%) based on current and future performance (see
pages 48 and 53)
2025/26 focus: Continued supply chain optimisation through regional
sourcing, storing and shipping and modal shift to reduce distances
travelled, carbon footprint and cost. Further carrier engagement and
technology investment to enable green delivery choices
Opportunity
3. Distribution sites:
Reduced emissions and
energy costs through solar
generation
Strategic action
alignment:
Connected stakeholders:
Installation of solar panels on
available distribution site roof
space to reduce energy costs
and increase resilience
Chief of P&SC
and RPs
– Capital expenditure on distribution
site solar generation and storage
solutions has been embedded in
goodwill impairment on page 100
– Reduction in energy costs
– Percentage of 2024/25 electricity
use from on-site solar generation:
2%
– Investing in solar panels at our distribution sites or leasing new
distribution sites with solar installed
– Investment approved for the construction of a new FC in Milan, Italy,
which includes the installation of solar panels on the roof
– Net zero capex investment of c. £2m per annum added to the five-
year strategic plan
2025/26 focus: Review and progress proposals for installation of solar
generation at further sites
TCFD continued
1. Scope 3 emissions from product transportation (Category 4) per tonne of product sold.
2. Target reset in 2024/25. Previously 25% reduction per tonne of product sold.
RS Group plc Annual Report and Accounts 202570
Strategic action Stakeholder key
Customers Products and suppliers Solutions Experience Operational excellence
Our people Customers Suppliers Communities Shareholders
CRRO Description Business owners Metrics monitored 2024/25 initiatives, progress and investment activities
Physical
Risk
4. Distribution sites:
Impact of extreme heat
Strategic action
alignment:
Connected stakeholders:
Increased costs associated with
installation of high-efficiency
cooling systems and/or potential
impacts on the health, safety and
wellbeing of people working at
our distribution sites which could
reduce productivity. Key material
site identified to be exposed to
extreme heat is our regional DC
in Fort Worth, US
Chief of P&SC
and RPs
– Distribution site operating
temperatures
– Worker productivity and absence
during high-heat periods (>35°C
and >40°C)
– Capital expenditure in heating,
ventilation and air conditioning
(HVAC) systems has been
embedded in goodwill impairment
on page 100
– Employee productivity monitored by site management teams
in distribution sites during high-heat periods with increased
ventilation, regular breaks and refreshments
– £1m capital investment in energy efficiency projects at our
DCs and FCs, for example roller doors and LED lighting
– At our regional DC in Fort Worth, US, we introduced real-time gas
monitoring connected to the building management system and
completed a small scale audit to identify further site energy
savings opportunities
2025/26 focus: Ongoing mitigation through business
continuity planning, review additional sites for HVAC and fabric
improvement options
5. Distribution sites:
Impact of extreme weather
Strategic action
alignment:
Connected stakeholders:
Extreme weather events,
including flooding, storms and
tornadoes, have the potential
to disrupt our operations and
logistics and cause physical
damage to our infrastructure.
Our regional DC in Fort
Worth, US, was identified to
be the key site at risk, due to
physical exposure and strategic
importance for our Americas
distribution network
Chief of P&SC
and RPs
– Distribution site insurance costs
– Frequency and cost impact
of severe weather events on
distribution sites
– Investment in distribution site
facility improvements
– Ongoing business continuity planning by our regional DC team
in Fort Worth, US, includes mitigations such as drop shipments,
alternative warehousing, updated contingency plan and enhanced
revenue recovery procedures
– On 4 March 2025, a severe storm with strong winds caused damage
to our regional DC warehouse in Fort Worth, US. This included a
displaced HVAC unit and roof damage resulting in water leaks. The
affected area was evacuated for a structural assessment. Nobody
was hurt and we did not experience any major service issues. The
building was operational again within 72 hours. A thorough review
has been conducted, with key learnings and actions embedded into
our ongoing risk management plan for the site
– Following the devastating wildfires across California, US, in January
2025, despite our people and operations not being directly
impacted by the disaster, we set up an emergency response fund
(see page 63)
2024/25 focus: Ongoing mitigation through business
continuity planning
RS Group plc Annual Report and Accounts 2025 71GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
1. 2030 – medium term, 2050 – long term. Time horizons for the climate scenario analysis were selected according to the time periods for which data was consistently available for both IEA and RCP
scenarios within the range of RS’s medium and long-term risk time horizons outlined on page 69.
2. Aligned to RS enterprise risk management guidance, a CRRO is considered to be material where the annual net impact on adjusted operating profit is greater than +/- 16-24%. CRRO 1 Products,
solutions and customers: changes in customer segments and product demand is the only CRRO deemed to be material, aligned to this threshold.
3. NZE – The Net Zero Emissions scenario by 2050, APS – The Announced Pledges Scenario, STEPS – The Stated Policies Scenario (Source: IEA), RCPs 2.6, 4.5 and 8.5 (Source: IPCC).
Refreshed climate scenario analysis
High-level results of our refreshed climate
scenario analysis are shown in the table on the
right, with the net financial impact of CRROs post
mitigation. Opportunities indicate a positive net
impact on operating profit (shaded green) and
risks indicate a negative net impact (shaded red).
Our analysis indicates that physical risks are
expected to be greater under a higher warming
scenario, whereas transition opportunities and
risks are greater under lower temperature
scenarios, due to faster and more significant
policy and market changes to deliver the low-
carbon transition.
For further detail on our quantitative financial
scenario analysis methods, please refer to our
basis of reporting document at: rsgroup.com/
sustainability
Net financial impact
Overall, we have low exposure to physical
climate risks, with our operations generally
in low-risk locations. Furthermore, our
diversified business model and global
customer base, strong supplier partnerships
and capital strength mean we are well placed
to mitigate potential future risks. We are also
well positioned to support the transition to
a low-carbon industrial sector by leading
in sustainable products, solutions and
industry sectors.
Our analysis suggests that, if we deliver
upon our strategic growth ambitions relating
to low-carbon products, service solutions
and industry sectors, we will see a net
positive financial impact from the CRROs.
This demonstrates the overall resilience of
our business model to manage our risks and
maximise our opportunities under various
future climate pathways.
Key:
Annual impact on Group adjusted operating profit
2
CRRO Description Financial impact Timeframe
1
Annual net impact on Group
adjusted operating profit
financial materiality key
Transition Temperature rise 1.5℃ 2℃ >2℃
1. Opp Products, solutions and customers:
changes in customer segments
and product demand
Annual revenue impact 2030 Very Low Very Low Very Low
2050 Medium Low Very Low
2. Risk Logistics: technology transition
and rising fuel costs
Increased operating costs, fully
offset through embedding in
pricing margin
2030 No impact No impact No impact
2050 No impact No impact No impact
3. Opp Distribution sites: reduced
emissions and energy costs
through solar generation
Annual operating costs impact
(including depreciation)
2030 Very Low Very Low Very Low
2050 Very Low Very Low Very Low
Physical Temperature rise 2℃ >2℃ >4℃
4. Risk Distribution sites: impact
of extreme heat
Capital and operating costs to
mitigate risk, expected to fully
mitigate impact on productivity
2030 Very Low Very Low Very Low
2050 Very Low Very Low Very Low
5. Risk Distribution sites: impact
of extreme weather
Annual revenue impact and
operating cost, offset by
recovery via insurance policies
2030 No impact Very Low Very Low
2050 No impact Very Low Very Low
Very high >32%
High 24 to 32%
Medium 16 to 24%
Temperature Scenario
Transition
1.5℃ NZE - 1.4℃
2℃ APS - 2.1℃
>2℃ STEPS - 2.6℃
Temperature Scenario
Physical
2℃ RCP 2.6 - 2.0℃
>2℃ RCP 4.5 - 2.4℃
>4℃ RCP 8.5 - 4.3℃
Low 8 to 16%
Very low 0 to 8%
No impact 0%
Temperature scenarios
3
TCFD continued
RS Group plc Annual Report and Accounts 202572
Risk management
Our CRROs are managed in line with the Group’s
risk management framework to ensure a robust
and consistent approach. We have a high-level
CRRO risk register and mitigation plans, which are
refreshed annually in consultation with market
and functional leaders. We also have strategies
and controls in place to mitigate physical climate-
related risks on our operations and wider supply
chain (see page 42).
CRROs are integrated into our risk management
process for ongoing management. Each CRRO
has an owner, mitigating controls and a series
of metrics and targets that are monitored and
reported annually. The internal audit and risk
team monitor the controls associated with our
CRROs and review these frameworks, where
relevant, when conducting audit inspections.
A review of ESG impacts is incorporated at
the due diligence stage of acquisitions and
investment will be added to future integration
plans. Updates and key risks are provided to the
ExCo, Audit Committee and the Board during their
bi-annual risk reviews to ensure a clear line of
sight and integration into our strategy, business
planning and decision making. In 2024/25, we
introduced a new risk control questionnaire to
site management teams, which incorporated
five climate-related questions. This has helped
to increase awareness and accountability at a
site level, while enabling us to continue horizon
scanning and maintain oversight of this principal
risk. We have also taken steps in the year
to broaden our risk management approach
under the requirements of CSRD, where we
fine-tuned the risk descriptors and developed
new opportunity descriptors to make sure that
both risks and opportunities were assessed
in a quantitative and objective way. For more
information on our principal risks, including
climate change, see pages 38 to 42.
Metrics and targets
To understand and manage our climate impacts,
we monitor key metrics for our CRROs and have
set performance targets related to the most
material CRROs (aligned to the materiality of their
financial impact as outlined on page 72). Each of
our CRROs has a business owner to oversee
the approach with relevant leadership teams,
see pages 70 and 71. The Group’s non-financial
KPIs contain four climate-related metrics and
targets (Scope 1 and 2 carbon emissions, carbon
intensity, packaging intensity and waste recycled)
and we have set four SBTs covering our most
material Scope 1, 2 and 3 emissions categories,
which were validated by the SBTi in 2023/24.
These are reviewed by the ExCo quarterly and
the Board biannually (see page 65). In 2024/25,
our 2030 targets for packaging intensity and
product transport emissions intensity were
increased, taking account of our progress to date
and forecasted performance. More details on
the rationale behind this are on pages 52 and
53. Additionally in 2024/25, we were included in
CDP’s prestigious A-list, having improved our CDP
rating this year from A- to A for our commitment
to climate action, environmental transparency
and disclosure.
Our science-based Scope 1 and 2 carbon
reduction target is included in the annual
performance incentive for 48% of all RS
employees, including the annual incentive for
Executive Directors (see page 66). We monitor a
set of key climate metrics to ensure our net zero
action plan is on track, refer to the Advancing
sustainability section on pages 48 to 55 for a
full update on our progress and performance
against our climate-related metrics and targets,
as well as our online data centre for the total list
of all ESG metrics we monitor. We will continue
to develop our climate-related metrics and
targets further through our climate transition
plan, which we will publish in line with developing
compliance timelines.
RS Group plc Annual Report and Accounts 2025 73GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Independent limited assurance report
ESG
ASSURANCE
Independent limited assurance report to RS Group plc
ERM Certification and Verification Services Limited (ERM CVS) was engaged by RS Group plc (the Group) to provide limited assurance in relation to the selected information set out below and presented in RS Group’s
Annual Report and Accounts 2025 and 2024/25 ESG data centre (the Reports).
Engagement summary
Scope of our assurance
engagement
Whether the following 2024/25 selected information on pages 47, 50, 51, 52 and 53 of the Annual Report and Accounts 2025 and 2024/25 ESG data centre are fairly
presented, in all material respects, in accordance with the reporting criteria:
Selected information – Total Scope 1 and Scope 2 GHG emissions (tonnes CO
2
e) (including recent
acquisitions and excluding recent acquisitions)
– Carbon intensity (total Scope 1 and Scope 2 (market-based) GHG emissions in
tonnes CO
2
e per £ million revenue) (including recent acquisitions and excluding
recent acquisitions)
– Total Scope 3 GHG emissions from the following categories (tonnes CO
2
e):
– Category 1 – Purchased goods and services
– Category 4 – Upstream transportation and distribution
– Category 11 – Use of sold products (RS PRO products only)
– Product transportation emissions intensity (tonnes CO
2
e per tonne of product sold)
– In-use carbon intensity (RS PRO products only) (tonnes CO
2
e per tonne of product sold)
– Packaging intensity (tonnes packaging per £ million revenue)
– Percentage of management that are women (%)
– Percentage of ethnically diverse leaders (%)
– Employee engagement score (#)
– All accident frequency rate (number of accidents per 200,000 hours)
– Total waste generated (tonnes)
– Total weight of waste recycled (tonnes)
– Total weight of waste incinerated (tonnes)
– Total weight of waste landfilled (tonnes)
– Waste intensity (tonnes per £million revenue)
Our assurance engagement does not extend to information in respect of earlier periods or to any other information included in the Reports.
Reporting period – 2024/25 (1 April 2024 – 31 March 2025)
Reporting criteria – The GHG Protocol Corporate Accounting and Reporting Standard (WBCSD/WRI
Revised Edition 2015) for the Scope 1 GHG emissions
– GHG Protocol Scope 2 Guidance (An amendment to the GHG Protocol Corporate
Standard (WRI 2015) for the Scope 2 GHG emissions
– The Corporate Value Chain (Scope 3) Accounting and Reporting Standard (WBCSD/
WRI 2011) for Scope 3 GHG emissions
– The Group’s internal definitions (basis of reporting) for the KPIs, as described in the
Group’s ESG basis of reporting 2024/25 (see: rsgroup.com/sustainability)
Assurance standard
andlevel of assurance
We performed a limited assurance engagement, in accordance with the International Standard on Assurance Engagements ISAE 3000 (Revised) ‘Assurance Engagements
other than Audits or Reviews of Historical Financial Information’.
The procedures performed in a limited assurance engagement vary in nature and timing from and are less in extent than for a reasonable assurance engagement and
consequently, the level of assurance obtained in a limited assurance engagement is substantially lower than the assurance that would have been obtained had a reasonable
assurance engagement been performed.
Respective responsibilities The Group is responsible for preparing the Reports and for the collection and presentation of the information within it and for the designing, implementing and maintaining
of internal controls relevant to the preparation and presentation of the selected information.
ERM CVS’ responsibility is to provide a conclusion to the Group on the agreed scope based on our engagement terms with the Group, the assurance activities performed
and exercising our professional judgement.
RS Group plc Annual Report and Accounts 202574
Our conclusion
Based on our activities, as described below,
nothing has come to our attention to indicate that
the selected information for 2024/25 is not fairly
presented in the Reports, in all material respects,
in accordance with the reporting criteria.
Our assurance activities
Considering the level of assurance and our
assessment of the risk of material misstatement
of the selected information, a multi-disciplinary
team of sustainability and assurance specialists
performed a range of procedures that included,
but was not restricted to, the following:
– Evaluating the appropriateness of the reporting
criteria for the selected information
– Interviewing management representatives
responsible for managing the
selected information
– Interviewing relevant staff to understand
and evaluate the management systems and
processes (including internal review and control
processes) used for collecting and reporting the
selected information
– Reviewing of a sample of qualitative and
quantitative evidence supporting the selected
information at a corporate level
For the Scope 3 GHG emissions from categories
1and 11 and the in-use carbon intensity for
RSPRO products, our work consisted of reviewing
the calculations of the GHG emissions and the
carbon intensity based on purchase and sales
transactions extracted from the Group’s financial
systems and applying the methodology developed
by the Group; we have not separately audited the
purchase and sales transactions underlying these
GHG emissions and carbon intensity.
Our observations
We have provided the Group with a separate
Management Report with our detailed
observations. Without affecting our assurance
conclusion, we make the following observation:
– As disclosed on page 51 of the Annual Report
and Accounts 2025 and in the ESG basis of
reporting 2024/25, the Group accounts for
product transportation (Scope 3 Category 4)
GHG emissions from inbound, outbound and
inter-site deliveries where these are controlled
by RS Group
– Performing an analytical review of the year
end data submitted by all locations included in
the consolidated 2024/25 group data for the
selected information which included testing the
completeness and mathematical accuracy of
conversions and calculations and consolidation in
line with the stated reporting boundary
– Conducting site visits to RS Group sites in Corby
(UK), Bad Hersfeld (Germany) and Fort Worth
(USA) to review source data, local reporting
systems and controls
– Evaluating the conversion factors, emission
factors and assumptions used; and
– Reviewing the presentation of information
relevant to the assurance scope in the Reports to
ensure consistency with our findings
The limitations of our engagement
The reliability of the selected information is
subjectto inherent uncertainties, given the
available methods for determining, calculating
orestimating the underlying information.
It is important to understand our assurance
conclusions in this context.
For the carbon and packaging intensity KPIs,
we reviewed the accuracy of the calculations
based on the final, assured GHG emissions
and packaging data for 2024/25 and the
audited revenue figure for 2024/25 provided
by the Group; we have not separately audited
the revenue figure used in the calculation of
these KPIs.
Our independence, integrity and
quality control
ERM CVS is an independent certification
andverification body accredited by the United
Kingdom Accreditation Service to ISO17021:2015.
Accordingly we maintain a comprehensive system
of quality control, including documented policies
and procedures regarding compliance with
ethical requirements, professional standards and
applicable legal and regulatory requirements.
Our quality management system isat least as
demanding as the relevant sections ofISQM-1
and ISQM-2 (2022).
ERM CVS applies a Code of Conduct and related
policies to ensure that its employees maintain
integrity, objectivity, professional competence
and high ethical standards in their work.
Our processes are designed and implemented
to ensure that the work we undertake is
objective, impartial and free from bias and
conflict of interest. Our certified management
system covers independence andethical
requirements that are at least as demanding as
the relevant sections of the IESBA Code relating to
assurance engagements.
ERM CVS has extensive experience in conducting
assurance on environmental, social, ethical and
health and safety information, systems and
processes and provides no consultancy related
services to the Group in any respect.
20 May 2025
London, UK
ERM Certification and Verification Services Limited
www.ermcvs.com
Email: post@ermcvs.com
RS Group plc Annual Report and Accounts 2025 75GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
Non-financial and sustainability information statement
NON-FINANCIAL
AND SUSTAINABILITY
INFORMATION STATEMENT
Reporting requirement and policy position Relevant policies and standards Due diligence and further information
Environmental
matters
Our environmental policies set out our commitment to
continuously improving our environmental performance
toensuresustainable growth in line with global goals.
Global Environmental Policy
Group Energy Management Policy
Supplier Ethical Trading Declaration
– Advancing sustainability: pages 48 to 55
– TCFD report: pages 68 to 73
– Sustainability section of website: rsgroup.com/sustainability
People Our people policies support our people plan and ambition
tocreate an inclusive and engaging environment where
everyone isproud and excited to come to work and can
perform at their best,develop and thrive.
Group Health & Safety Policy
Diversity and Inclusion Policy
Gender Pay Gap Report
Equal Opportunity Policy
Speak Up Policy
– Empowering our people: pages 56 to 60
– Governance report: pages 78 to 91
– Nomination Committee report: pages 93 to 96
– Sustainability section of website: rsgroup.com/sustainability
Social matters We have strict standards of behaviour that we expect of
ouremployees and supply chain partners, which are set
outin our Code of Conduct and Ethical Trading Declaration.
This includes respecting and safeguarding our people and
wider community.
Supplier Code of Conduct
Ethical Trading Declaration
Information Security Policy
Volunteering Policy
– Empowering our people: pages 56 to 60
– Championing youth & communities: pages 61 to 63
– Doing business responsibly: pages 64 to 67
– Sustainability section of website: rsgroup.com/sustainability
Respect for
human rights
We recognise and respect the Universal Declaration
ofHuman Rights, ensuring that all people have freedom,
dignityand equality. We uphold the highest ethical and
legalstandards within our business and supply chain.
Modern Slavery Policy
Modern Slavery Statement
UNGC Communication on Progress (COP)
Conflict Minerals and Chemicals of Concern Policy
– Doing business responsibly: pages 64 to 67
– Sustainability section of website: rsgroup.com/sustainability
Anti-bribery and
corruption
We have a zero-tolerance stance on all forms of bribery and
corruption and are committed to conducting our activities
inline with UNGC Principle 10. Our Group Anti-Bribery
Policy covers our stance on these matters in detail.
Anti-Bribery Policy
Commitment to Compliance and Quality Policy
Competition Law Compliance Policy
Tax Strategy
Corporate Criminal Offence Policy
– ESG governance: page 65
– Governance report: pages 78 to 91
– Audit Committee report: pages 97 to 103
– Sustainability section of website: rsgroup.com/sustainability
Business model – Business model and strategy: pages 11 and 16
Non-financial KPIs – Non-financial KPIs: pages 26 and 27
Principal risks – How we manage our risks effectively: pages 36 and 37
– Our principal risks and uncertainties: pages 38 to 44
Climate-related
financial disclosures
– Disclosures aligned to clauses (a) to (h) of The Companies
(Strategic Report) (Climate-related Financial Disclosure)
Regulations 2022 detailed in the TCFD report: pages 68 to 73
This section constitutes the Group’s non-financial information statement (NFIS), produced
tocomply with sections 414CA and 414CB of the Companies Act 2006. The information presented
below is incorporated by cross-reference and most of the policies listed can be found on our
website: rsgroup.com/sustainability/codes-policies-and-standards. Our Code of Conduct
underpins the Group’s business activities while providing our stakeholders with clear guidance on
expected behaviours, actions and compliance requirements covering each of the below areas.
RS Group plc Annual Report and Accounts 202576
Section 172 statement
SECTION 172
STATEMENT
The Companies Act 2006 and section 172
Under the Companies Act 2006, our Directors are required
to act in a way that they consider, in all good faith, would
most likely promote the success of RS Group plc and
its stakeholders. Throughout 2024/25, we have strived
to continue to demonstrate how, as a considerate,
sustainable, responsible and solutions-driven business,
our Board of Directors and the ExCo have achieved this.
Throughout thisreport, there are many examples of
how we have taken intoaccount our key stakeholders:
our people, customers, suppliers, communities and
shareholders. Details of how theBoard in particular
has considered these stakeholders’ interests can be found
in the Corporate Governance Report on pages 86 and 87.
Forward-looking statements This financial report contains certain statements,
statistics and projections that are or may be forward looking. The accuracy and
completeness of all such statements,including, without limitation, statements
regarding the future financial position, strategy, projected costs, plans and
objectives for the management of future operations ofRS Group plc and its
subsidiaries is not warranted or guaranteed. Statements that are not historical
facts, including statements about our beliefs and expectations, and including
(without limitation) statements containing words such as ‘may’, ‘will’, ‘should’
‘projects’, ‘intends’, ‘expects’, ‘anticipates’, ‘estimates’, ‘believes’, ‘aims’ and wordsof
similar import, are forward looking statements. By their nature, forward-looking
statements involve risk and uncertainty because they relate to events and depend
on circumstances that will occur in the future. Although RS Group plc believes
that the expectations reflected in such statements are reasonable, no assurance
can be given that such expectations will prove to be correct. There are a number
of factors, whichmay be beyond the control of RS Group plc, which could cause
actual results and developments to differ materially from those expressed or
implied by such forward-looking statements. Other than as required by applicable
law or the applicable rules ofany exchange on which our securities may be listed,
RS Group plc has no intention or obligation toupdate forward-looking statements
contained herein.
The long-term consequences of decisions that are taken
Board oversight of our strategy and ongoing monitoring of performance against agreed metrics Pages 16, 24 to 27 and
86 to87
Ensuring we have the right foundations to support the Group’s growth opportunity Pages 10 and 23
Acquisition and integration of Risoul and Distrelec into the Group’s business tocreate effective synergies Pages 10, 23 and 33
Accelerating our growth ambitions organically and inorganically Page 23
Refining our strategy to provide greater focus, more alignment, better prioritisation and improved execution Pages16 to 22
The interests of our employees
Strengthening our commitment to our people and culture through the embedding of our new set of values Pages 5 and 6
Creating an inclusive and engaging environment where everyone is proud and excited to come to work and
can perform at their best, develop and thrive
Pages 56 to 58
Prioritising the health, safety and wellbeing of our workforce and providing career development and learning
opportunities
Pages 59 and 60
Continuing our programme of Board employee engagement Pages 7, 9, 83 and 88
The need to foster our business relationships with our customers, suppliers and regulators
Our competitive advantage and strategy in action Pages 11 and 16 to 22
Aligning our operating plans to build organisational capabilities and a scalable market strategy Pages 14 and 15
Engaging with our suppliers to help ease significant supply chain challenges Pages 13, 15 and 55
The impact of the Group’s operations on the environment and community
Enhancing a purpose-led culture, driving our ESG goals in our commitment fora better world Pages 45 to 73
Driving to be a sustainable and responsible leader in our sector Pages 64 to 67
Supporting suppliers to provide more sustainable and clean products Page 54
Our reputation for having high standards and sound ethical conduct
Code of conduct: for our people (Speak Up) and our suppliers Page 66
Ensuring anti-bribery training is regularly rolled out to our employees Page 66
Ensuring we apply a zero-tolerance approach to modern slavery Page 66
The need to act fairly between members of the Company
Continuing to pursue a progressive dividend policy Page 32
Increasing operational effectiveness Pages 9 and 22
The Strategic Report was approved by the Board on 20 May 2025 and is signed on its behalf by:
Simon Pryce
Chief Executive Officer
RS Group plc Annual Report and Accounts 2025 77GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT
g
ROBUST GOVERNANCE
FOR EFFECTIVE
DECISION MAKING
IN THIS SECTION
Chairman’s letter 79
Board of Directors 80
Governance at a glance 82
Our governance framework 83
Board activities during the year 86
Board evaluation 89
Board appointments, time
commitments and development 91
Compliance with the
UK Corporate Governance Code 92
Nomination Committee report 93
Audit Committee report 97
Directors’ Remuneration report 104
Directors’ report 132
Statement of Directors’ responsibilities 135
Corporate governance
RS Group plc Annual Report and Accounts 2025 78
Dear shareholder
I am delighted to introduce our Governance
Report for 2024/25 on behalf of the Board
and in accordance with the 2018 UK Corporate
Governance Code (the Code). This report sets
out how the Board has applied its governance
framework and best practice to ensure effective
procedures are in place to support the creation
of long-term value for all our stakeholders.
The Board’s priority during the year has been
to oversee our strategic evolution. This has
included monitoring progress made against
our key performance indicators whilst building
strong foundations for our medium-term
financial targets. The Board is impressed
with the efforts made by both the ExCo and
RS team during the year, especially given
the background of an extremely challenging
business environment, and believes it is due to
them that we are delivering well on the things we
can control.
Board and Committee changes
We welcomed two new Non-Executive Directors
to the Board: Carole Cran who joined the
Board with effect from 1 December 2024, and
Miles Roberts who joined with effect from
1 March 2025. Carole joins RS with extensive
financial experience and has a strong focus
on governance and risk. Miles brings a strong
background in financial and operational
management and has a strong focus on strategy,
risk and sustainability. Together they bring
international and sector experience. Carole has
become a member of the Audit Committee
and Miles has become a member of the Audit,
Nomination and Remuneration Committees.
I very much look forward to working with them.
We also said goodbye to Navneet Kapoor who
stepped down from the Board with effect
from 31 December 2024, having served as
Non- Executive Director since 2022, to focus on
his executive commitments. I would like to thank
Navneet for the valuable contribution he made
to RS since his appointment.
Strategy
This has been an area of particular focus during
the year supported by an improved cadence
and richer data. A dedicated strategy session
was held with the Board in January 2025,
where the ExCo presented their update to the
strategic plan and priorities for the business
and functions. The Board was provided with an
overview of the successes and learnings from
the prior year. In addition to the annual strategic
session, the Board holds deep-dive strategic
discussions at each Board meeting regarding
each of the regions and functions.
We believe this focus on strategy will help drive
better execution and accelerate value creation
through increased revenue and returns,
expanding automated logistics and closer
relationships with strategic suppliers. These will
be underpinned by our continued commitment
to industry-leading ESG and robust governance.
Culture
Throughout the year, the Board provided
oversight of the Group’s culture, receiving direct
and indirect feedback on the embedding of
our values. The Board has maintained its focus
on diversity and inclusion (D&I) and strongly
believes that diversification of thought and
inclusiveness enhances decision making whilst
strengthening and underpinning a healthy
culture. For more information on our values,
people plan and D&I see pages 6, 17, 58 and 96.
Stakeholder engagement
Our two designated employee engagement
Directors, Bessie Lee and Joan Wainwright
met with the Chairs of a number of our
Employee Resource Groups (ERGs) in
January 2025. In March 2025, Bessie and Joan
met with employee representatives from the
UK Distribution Centres (DCs) and London, UK
office. Bessie also visited our Shanghai, China
office in April 2024. The visit comprised a tour
of the office, meeting with local management,
attending a town hall with employees and
hosting an employee round table event with
employee representatives.
We continue to believe in the benefit of engaging
actively with our shareholders. In addition to
investor meetings and our investor event in
September 2024, there has been extensive
engagement with shareholders in respect of the
proposed 2025 Directors’ Remuneration Policy.
This has been led by Joan Wainwright, the Chair
of our Remuneration Committee.
Further information regarding employee and
shareholder engagement can be found on
page 88.
Board evaluation
An internal evaluation of the Board was
conducted during the year. The outcome of this,
along with an update regarding the previous
year’s internal evaluation, can be found on pages
89 and 90.
Corporate Governance Code
The Company’s statement of compliance with
the Code can be found on page 92.
Rona Fairhead
Chairman
20 May 2025
Rona
Fairhead
Chairman
Activities during 2024/25
– Overseeing improved strategic execution
– Continued support and effective
challenge of the Executive Committee
(ExCo)
– Appointment of Carole Cran and
Miles Roberts as Non-Executive
Directors as part of broader Board
succession planning
– Monitoring the effectiveness of our
operating model, our cultural evolution
and values
– Overseeing the Company’s response to
evolving ESG regulations
– An extensive shareholder engagement
programme in developing the 2025
Directors’ Remuneration Policy
Priorities for 2025/26
– Continued development of both Executive
and Non-Executive succession planning
– Monitoring of our ESG reporting
to help ensure compliance with
evolving regulations
– External Board evaluation
– Continued evolution of our corporate
governance arrangements, including
preparedness for the 2024 UK Corporate
Governance Code, which will apply to
RS from the 2026/27 financial year, with
particular focus on internal controls
CHAIRMAN’S
LETTER
RS Group plc Annual Report and Accounts 2025 79STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
A strong, experienced
Board, with a diverse
range of backgrounds
and skills enhances
decision making
for the benefit of
all stakeholders.
Rona Fairhead
Chairman
Committee membership
N
Date of appointment
November 2020
Skills, experience and
contribution
Rona brings a tremendous range
of commercial and strategic
experience to the Company.
Rona’s strong understanding of
UK corporate governance and her
extensive experience in digital
transformation and international
expansion provide the Board with
strong and valuable leadership
to deliver long-term sustainable
value for all our stakeholders.
Previous roles have included
chair of the BBC Trust, Minister of
State in the UK Department for
International Trade, non-executive
director of HSBC Holdings plc
and PepsiCo, Inc. and chair and
chief executive officer of Financial
Times Group.
Current external roles
– Non-executive director of
Oracle Corporation
– Member of the House of Lords
– Member of the International
Advisory Council of Hong Kong
Exchanges & Clearing Limited
– Senior independent director of
CVC Capital Partners plc
Simon Pryce
Chief Executive Officer
1
Committee membership
D
Date of appointment
September 2016
1
Skills, experience and
contribution
Simon is a highly experienced
leader of customer-focused,
global industrial manufacturing
and service businesses. He has
a strong track record of driving
results and delivering excellent
stakeholder outcomes through
enhanced performance and the
effective execution of organic
and inorganic growth strategies.
Previous roles include chief
executive officer of Ultra Electronics
Holdings plc, group chief executive
of BBA Aviation plc and a range
of international finance and
management roles at GKN plc, JP
Morgan and Lazards. He is also
currently a non-executive director
of Smiths Group plc.
Current external roles
– Non-executive director of
Smiths Group plc
Kate Ringrose
Chief Financial Officer
Committee membership
D
Date of appointment
October 2023
Skills, experience and
contribution
Kate has extensive experience of
successfully leading the finance
function in a FTSE 100 company.
She has a proven track record in
driving business transformation,
improving business resilience,
leading operational excellence
and accelerating strategic growth.
Kate is a chartered accountant and
trained with KPMG in South Africa.
Previously, Kate had a successful
18-year career at Centrica plc
where she held various senior
roles in energy supply, service
solutions, trading and financial
operations. Her most recent role
was group CFO.
Current external roles
– None
David Sleath, OBE
Senior Independent Director
Committee membership
N
A
R
Date of appointment
June 2019
Skills, experience and
contribution
David brings a wealth of experience
to the Board, including valuable
insight into the dynamics of
service- led business models, having
been the senior independent
director of Bunzl plc. As serving
chief executive officer, and
previously chief financial officer,
of SEGRO plc, David has strong
financial, real estate, manufacturing
and distribution experience. He also
brings to the Board in-depth
financial, strategic and governance
experience, which are essential
to his role as Senior Independent
Director. David has also previously
served as president of the British
Property Federation and group
finance director of Wagon plc.
Current external roles
– Chief executive officer of
SEGRO plc
Alex Baldock
Independent Non-Executive
Director
Committee membership
A
R
Date of appointment
September 2021
Skills, experience and
contribution
Alex has extensive experience
in digital transformation,
accelerating omni-channel
growth and embedding customer
focus, evidenced through his
successful transformation of
Currys plc. Alex was previously
chief executive officer of Shop
Direct, now the Very Group,
where he led the business’s digital
transformation from a catalogue
retailer to the UK’s second
largest e-commerce pureplay
and through four consecutive
years of record growth in sales,
profits, customer satisfaction and
colleague engagement.
Current external roles
– Group chief executive of
Currys plc
1. Joined in September 2016 as Non-Executive Director. Appointed as CEO on
3 April 2023.
Members as at 20 May 2025:
N
Nomination Committee
A
Audit Committee
R
Remuneration Committee
D
Disclosure Committee Committee Chair
BOARD OF
DIRECTORS
RS Group plc Annual Report and Accounts 202580
Louisa Burdett
Independent Non-Executive
Director
Committee membership
N
A
R
Date of appointment
February 2017
Skills, experience and
contribution
Louisa brings a wealth of financial,
commercial, M&A and risk
management experience to the role
of Non-Executive Director and Chair
of the Audit Committee. Louisa is
a chartered accountant and has
held senior financial positions
in industrial, manufacturing,
publishing and pharmaceutical
companies. Louisa was previously
the chief financial officer of Croda
International plc and Meggitt plc,
group finance director of Victrex
plc, and chief financial officer
of Optos plc and the Financial
Times Group.
Current external roles
– Chief financial officer of Spirax
Group plc
Carole Cran
Independent Non-Executive
Director
Committee membership
A
Date of appointment
December 2024
Skills, experience and
contribution
Carole has extensive financial
experience and a strong focus on
governance and risk. Carole is chief
financial officer of Halma plc, having
previously served as independent
non-executive director. Previously,
Carole held the position of chief
commercial officer and finance
officer of Forth Ports Limited
until November 2024, prior to
which she held the position of
chief financial officer of Aggreko
plc until December 2017 and a
number of senior finance roles
within that group. She also held
senior financial positions at BAE
Systems plc. Carole commenced
her career in the audit division of
KPMG where she qualified as a
Chartered Accountant.
Current external roles
– Chief financial officer of
Halma plc
Bessie Lee
Independent Non-Executive
Director
Committee membership
N
Date of appointment
March 2019
Skills, experience and
contribution
Bessie has extensive strategic
experience in digital marketing
technology and media knowledge,
principally in Greater China.
She has in-depth experience in
the world of eCommerce and
digital media. She is a frequent
media commentator, blogger and
international speaker. Bessie has
more than 30 years’ experience in
the media communications industry
in Greater China. Her previous roles
include chief executive officer of JLL
Greater China, Mindshare, GroupM
and WPP in China.
Current external roles
– Chief executive officer
of Withinlink
– Governor of University of the
Arts London
Miles Roberts
Independent Non-Executive
Director
Committee membership
N
A
R
Date of appointment
March 2025
Skills, experience and
contribution
Miles has extensive financial and
operational experience, particularly
within international manufacturing
industries. Miles brings a wide
level of board experience, together
with specific experience of large,
long-term capital projects,
alongside a particular focus on
sustainability. Miles was group chief
executive of DS Smith Plc from 2010
until the company was taken over
by International Paper in January
2025. He is currently acting as an
advisor to DS Smith Limited and
International Paper subsequent to
that takeover. He was previously
chief executive of McBride plc,
having joined as its group finance
director and has held non-executive
positions at Aggreko plc and
Poundland Group plc. Miles became
a qualified chartered accountant
after an early career in engineering.
Current external roles
– Non-executive director of Land
Securities Group PLC
– Advisor to DS Smith Limited and
International Paper
Joan Wainwright
Independent Non-Executive
Director
Committee membership
N
R
Date of appointment
November 2019
Skills, experience and
contribution
Joan has extensive experience in
distribution, transforming digital
platforms to generate revenue
growth and leading customer
experience programmes that
drive measurable improvements.
Her extensive knowledge of
customer experience aligns with
the Company’s vision and she
provides a strong insight into the
customer dynamic in the US. Joan’s
previous roles include president,
channel and customer experience
at TE Connectivity Ltd, vice
president, public affairs at Merck
& Co, and deputy commissioner of
communications at the US Social
Security Administration.
Current external roles
– Director of NJM Insurance Group
– Member of the global advisory
council of ServiceNow
Clare Underwood
Chief of Corporate Services
and Company Secretary
Date of appointment
March 2022
Skills, experience and
contribution
Clare brings a wealth of FTSE 100
governance experience to support
the Board in effective governance.
The skills and knowledge from
her previous roles at John Laing
Group plc and Cable and Wireless
Communications plc enable her
to provide first-class company
secretarial advice and support.
Clare is a member of the ExCo and
leads the Corporate Services team,
one of our enabling functions
which serves the Group as centres
of excellence in shared business
services, indirect procurement, ESG,
health and safety, legal, governance
and compliance. Clare is also
executive sponsor for our ERG,
Elevate.
Other Directors who
served during the year
Navneet Kapoor stepped
down from the Board on
31 December 2024.
Members as at 20 May 2025:
N
Nomination Committee
A
Audit Committee
R
Remuneration Committee
D
Disclosure Committee Committee Chair
RS Group plc Annual Report and Accounts 2025 81STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
BOARD COMPOSITION
As at 31 March 2025
BOARD AND COMMITTEE MEETING ATTENDANCE
Director Board Nomination Audit Remuneration
Rona Fairhead 7/7 4/4 – –
Simon Pryce 7/7 – – –
Kate Ringrose 7/7 – – –
Alex Baldock¹ 7/7 – 3/4 5/6
Louisa Burdett
2
6/7 4/4 3/4 4/6
Carole Cran
3
3/3 – 1/1 –
Navneet Kapoor
4
5/5 2/3 3/3 –
Bessie Lee 7/7 4/4 – –
Miles Roberts
5
1/1 1/1 0/0 1/1
David Sleath 7/7 4/4 4/4 6/6
Joan Wainwright 7/7 4/4 – 6/6
SKILLS, EXPERIENCE AND KNOWLEDGE OF OUR BOARD
Summary of the skills, experience and knowledge held
by our Directors.
Digital
Emerging Markets
M&A
Service Industry
ESG
Finance
Strategy
Technology
International Operations
Supply Chain
Distribution
Customers
70%
40%
70%
80%
80%
70%
80%
60%
100%
50%
50%
70%
Gender
Independence
Ethnicity
Board tenure
Years
Nationality
Age of Directors
Years
Female 6
Male 4
Non-ethnic minority 9
Ethnic minority 1
British 7
Chinese 1
American 1
British and South
African 1
45-54 2
55-64 8
0–3 years 3
3–6 years 5
6+ years 2
Independent 6
Executive 2
Independent
Non-Executive
Chairman 1
Senior
Independent
Director 1
1. Alex Baldock was unable to attend
one Audit and Remuneration
Committee meeting due to a
prior engagement.
2. Louisa Burdett was unable to
attend one Board, Audit and
ad-hoc Remuneration Committee
meeting due to illness and
one ad-hoc Remuneration
Committee meeting due to a
prior engagement.
3. Carole Cran joined the Board on
1 December 2024.
4. Navneet Kapoor was unable to
attend one Nomination Committee
meeting due to travel disruption.
Navneet stepped down from
the Board with effect from
31 December 2024.
5. Miles Roberts joined the Board
on 1 March 2025.
The FTSE Women Leaders Review 2025
1
ST
Joint first in the FTSE 250
GOVERNANCE
AT A GLANCE
RS Group plc Annual Report and Accounts 202582
Our governance framework underpins and
supports robust governance across the Group
aimed at ensuring efficient decision making and
clear division of responsibilities.
The Board’s principal responsibility is to
promote and assess the long-term sustainable
success of the Group as a whole, generating
value for shareholders and contributing to
the wider society. The Board is accountable
to stakeholders for the Group’s financial and
operational performance and is responsible
for taking material strategic decisions and
providing oversight across the Group. The Board
aims to lead with integrity and in a sustainable,
commercial manner to ensure value is created
for all the Group’s stakeholders. The Board also
provides guidance and challenge to Executive
Directors and senior leaders within a robust
governance framework to ensure that this
leadership is delivered effectively.
The Board is responsible for ensuring that
the strategic objectives are supported and
adequately resourced to help ensure the
long-term success of the Group, realisation
of its strategy, and to monitor the effective
deployment of those resources. The Group’s risk
management framework supports the strategic
actions of the Group, with controls to help
mitigate identified risks. The Board regularly
reviews the internal controls and overall risk
management framework, with support from
the Audit Committee. Full details of the risk
management framework can be found on pages
36 to 44.
The Board is supported by its Committees,
which make decisions and recommendations
on matters delegated to them by the Board.
This enables the Board to spend time on key
strategic matters. Each Committee comprises
Non-Executive Directors only and has an
experienced Chair. Regular updates are provided
to the Board by the Committee Chairs as well
as by the Chairman of the Board, the CEO and
CFO. Each Committee of the Board has provided
reports on how they have discharged their
responsibilities and details of their activities
during the year, which can be found on pages 93
to 131.
The key topics the Board has focused on this
year, as well as those it plans to assess for the
coming year, are set out on page 79.
In addition to the Committees of the Board,
the ExCo is responsible for making effective
decisions that keep the Group focused on the
right priorities, accelerate realisation of our
strategy, drive performance and ensure we
develop and maintain a diverse, supportive
and inclusive culture where our people are
empowered within a clear framework. The ExCo
supports the CEO in exercising his authority in
relation to material matters having strategic,
cross-business or Group-wide implications
and oversight of the day-to-day management
of the Company’s business. The members of
the ExCo are the CEO, CFO, the Presidents
for EMEA, Americas and Asia Pacific, Chief of
Product and Supply Chain, Chief of Customer
Experience, Chief of Corporate Services and
Company Secretary, Chief People Officer (CPO)
and Chief Information Officer. The ExCo has
representation from each of the regions, both
accelerator and enabling functions and brings
the voice of customers, suppliers, solutions and
technology to the decision-making process.
ALIGNING OUR PURPOSE,
VISION, VALUES AND
STRATEGY FOR LONG-TERM
VALUE
To achieve the long-term sustainable value
generation of the Group, the Board has
continued to work closely with the ExCo on the
Group’s purpose of making amazing happen for
a better world.
Following the refinement of the strategy during
2023/24, the Board has maintained oversight
of the Group’s strategic focus and better
prioritisation which, in turn, will help enable
enhanced execution at greater pace.
The Board recognises the importance of
ensuring alignment between purpose, vision,
values and strategy to accelerate successful
delivery. As part of the strategic review that took
place during 2023/24, our purpose and new set
of Group-wide values continue to be embedded
across the Group. During the year, activities
conducted by the Board to assess and monitor
the culture have included:
– An update on the embedding of the people
plan which highlighted the key initiatives
which will support our strategic actions
and cultural evolution. See page 17 for
further information.
– Bessie Lee and Joan Wainwright (as
our designated Directors for employee
engagement) met with a number of our
ERG chairs in January 2025 and employee
representatives from the Corby and
Nuneaton, UK DCs and London, UK office in
March 2025. Bessie also visited the Shanghai,
China office in April 2024. During the
meetings a number of issues were raised
including working conditions, resources,
technology, remuneration and benefits for
the wider workforce. In-depth feedback was
then provided to the Board following these
engagements, with outcomes being shared
with relevant management teams.
– Deep-dive strategic updates from each of our
regions, accelerator and enabling functions,
in addition to regular updates from the CEO
to each Board meeting, providing feedback
arising from touchpoints such as town hall
events and pulse surveys.
CASE STUDY
OUR GOVERNANCE
FRAMEWORK
RS Group plc Annual Report and Accounts 2025 83STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
NOMINATION
COMMITTEE
Chair: Rona Fairhead
Our Governance Framework continued
Our Strategic Report on pages 1 to 77
demonstrates how the business considers and
engages with the Company’s key stakeholders:
our people, customers, suppliers, communities
and shareholders. The following pages of the
Governance Report sets out how the Board
works and the areas of focus for the Board
during the year, how these relate to our
strategic aims and, where appropriate, how our
stakeholders have been considered.
The Board delegates the day-to-day operational
decision making of the business to the CEO and
CFO with support from the ExCo and their teams.
The Board recognises, however, that doing so
does not absolve it of its accountabilities to the
Group’s stakeholders and the need to reinforce
and support the ExCo’s decisions by setting the
tone from the top. The Board must consider
the needs of, and impacts of its decisions, on all
stakeholders as well as the consequences of its
decisions in the long term. The Board recognises
that, when making decisions, it will sometimes
have to consider the competing interests of
stakeholders and that it may not always be
possible to deliver an outcome that is welcomed
by all stakeholders. In these situations, the
Board is guided by the need to consider the
long-term sustainability of the business.
As part of our ESG governance, the Board
has close oversight of our ESG action plan
and is provided with frequent updates on
its performance. For further details on ESG
governance see pages 64 to 67.
In order to facilitate an effective working relationship between the Board and ExCo,
the Board receives regular updates and detailed reviews from the ExCo throughout the year.
THE BOARD
Chairman: Rona Fairhead
The Board is responsible for the oversight of the purpose, vision, strategy and values for the Group, ensuring the culture is
aligned, and promoting the long-term sustainable success of the Company for the benefit of our members and stakeholders.
The Board discharges some of its responsibilities directly or has delegated authority to its Committees.
EXECUTIVE COMMITTEE (EXCO)
Chair: Simon Pryce
Assisting the CEO in exercising his authority in relation to all matters affecting the operations,
performance and strategy, with input from regional, accelerator and enabling functions.
AUDIT
COMMITTEE
Chair: Louisa Burdett
REMUNERATION
COMMITTEE
Chair: Joan Wainwright
– Monitors integrity of
financial statements
and announcements
– Reviews the Group’s
internal financial controls
and internal control and
risk management systems
– Monitors the internal
audit function
– Manages the
external Auditors
– Agrees the Remuneration
Policy for Executive
Directors and
remuneration structure
for the ExCo
– Oversees ExCo and Group
workforce remuneration
– Approves the design and
targets for incentive plans
– Reviews the structure,
skills, knowledge,
experience and diversity
of the Board
– Identifies and nominates,
for approval by the
Board, candidates to fill
Director positions
– Leads succession
planning for Non-Executive
and Executive Directors
and has oversight of
succession planning
for the ExCo
+ See pages 93 to 96
for further details
+ See pages 97 to 103
for further details
+ See pages 104 to 131
for further details
DISCLOSURE
COMMITTEE
Chair: Simon Pryce
– Reviews procedures,
systems and controls
for identification
and treatment of
inside information
– Reviews regulatory
announcements,
shareholder circulars,
prospectuses etc,
before release
– Considers materiality
of variances between
performance
and forecasts
RS Group plc Annual Report and Accounts 202584
Division of responsibilities
There is a clear division of responsibilities between the leadership of the Board and the executive leadership of the Group. The responsibilities
of the Chairman, CEO, CFO, Senior Independent Director, Board and Committees are agreed by the Board. See pages 83 and 84 for the overall
governance framework and below for a summary of the division of responsibilities. Full details can be found at rsgroup.com
Meetings during the year
The Board held a combination of in-person
and virtual meetings during 2024/25 and a
breakdown of attendance is shown in the table
on page 82. No additional ad-hoc meetings
were held in addition to the seven scheduled
Board meetings.
There may be instances during the year where a
Director is unable to attend a meeting. If this is
the case, they are provided with all the meeting
information and have the opportunity to discuss
their feedback with the Chairman or Company
Secretary to ensure their contributions are
raised at the meeting.
During the year, the Chairman held a number
of meetings with the Non-Executive Directors
without the Executive Directors being
present. The Non-Executive Directors also
met without the Chairman to discuss the
Chairman’s performance.
The Chairman and the Committee Chairs
ensure Board and Committee meetings are
structured to facilitate open discussion, debate
and challenge. As part of the annual Board
evaluation process, the functioning of the Board
and each of its Committees are reviewed and
considered by the Board as a whole. The findings
of the review are used to establish an ongoing
programme of actions to improve effectiveness
of both the Board and the Committees.
Further information on this can be found on
pages 89 and 90.
Matters reserved for the board
All matters that have a material impact
upon the Group are reserved for the Board
and are formally set out in a schedule which
can be found on our website at:
rsgroup.com/investors/governance/
governance-framework
Position Responsibilities
Chairman
Rona Fairhead – Leading the Board and ensuring its oversight of strategy, performance, value creation, culture, stakeholders
and accountability
– Promoting open, trusting, challenging discussions and debate and constructive relations between
Executive and Non-Executive Directors
– Leading the Board succession planning and seeking to ensure effective communication with shareholders
Executive Directors
Simon Pryce (CEO) – Managing and leading the Group on a day-to-day basis, making decisions on matters affecting the
operation and performance of the Group’s business
– Designing, developing and implementing the strategic plans
– Ensuring robust management succession plans are in place
Kate Ringrose (CFO) – Financial management and implementation and monitoring of financial controls
– Developing the Group’s financial policies and strategies
– Ensuring a commercial focus across the business activities and appropriateness of risk management
Senior Independent Director
David Sleath – Acting as a sounding board to both the Chairman and the CEO
– Acting as a conduit for the views of other Non-Executive Directors and conducting the Chairman’s annual
performance appraisal
– Being available to shareholders to help resolve concerns
Non-Executive Directors
Alex Baldock
Louisa Burdett
Carole Cran
Bessie Lee
Miles Roberts
Joan Wainwright
– Overseeing and constructively challenging executive management regarding the performance
of management against agreed performance objectives, and helping to review and monitor the
Group’s strategy
– Satisfying themselves on the integrity of financial information and reviewing the Group’s risk exposure
and controls
Company Secretary
Clare Underwood – Supporting and advising the Board on matters relating to governance, ensuring good information
flows and providing practical support to the Directors
– Organising Directors’ induction and training
RS Group plc Annual Report and Accounts 2025 85STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
The Board is responsible for the overall leadership
of the Group and, throughout 2024/25, Board
activities and discussions continued to focus on
the Company’s strategic priorities.
The following pages outline some of the key
topics reviewed, monitored, considered and
discussed by the Board. Before the start of each
year, the Board and each of its Committees
consider and review a calendar of events and
agenda items for the year ahead. As part of
our governance framework and in response
to feedback received as part of the Board
evaluation process, key strategic items are
identified and scheduled throughout the
year. The Chairman, with assistance from the
CEO, CFO and Company Secretary, agrees the
agenda for each Board meeting. This process
ensures that sufficient time is being set aside
for strategic discussions and business critical
items, whilst including regular standing items,
such as reports on trading and financial
performance and routine reporting or
compliance requirements.
A timeline is provided over the following pages
detailing the key activities of the Board during
the year. The Board and its Committees received
regular updates on various aspects of the
business. A typical Board meeting will comprise
the following elements:
– Verbal updates from the Chairs of the Board
Committees on the proceedings of those
meetings, including the key discussion
points and particular matters to bring to the
Board’s attention.
– Update reports from the CEO and CFO
providing an overview of operational and
financial performance since the last meeting.
– Strategic deep dives provided by each of the
regional teams, accelerator and enabling
functions. These provide insight into risks and
opportunities, impacts on stakeholders and
progress against the strategic plan to provide
key discussion points for the Board. Details of
key topics considered during the year can be
found in our Section 172 Statement on page 77.
– Updates regarding our acquisition pipeline,
health and safety (H&S) performance and
investor relations.
– Feedback from any employee engagement
sessions or surveys and updates on
shareholder engagement and activities.
– Legal and governance updates, including:
regular updates in respect of the Speak Up
service, fraud, data protection, and approval
of the Anti-Slavery and Human Trafficking
Statement, along with any regulatory changes.
On the evening before most scheduled Board
meetings, all the Non-Executive Directors meet
either by themselves, or together with the entire
Board and Company Secretary, or with members
of the ExCo. This time is important for the Board
members to further build a rapport with each
other and enhance Board effectiveness, share
external views and consider issues impacting
the Company in a more informal environment,
resulting in better Board dynamics and
decision making.
Net zero and climate transition plan sessions
were delivered to the Board, highlighting
strategic planning, performance monitoring and
climate education and skills development.
Key themes and observations from employee
engagement sessions held in the UK and China
during the year were around the embedding of
the values, working conditions, IT infrastructure,
strategic prioritisation, macroeconomic
pressures and clarity of communications
and processes.
MAY 2024
Strategy
– Update from EMEA team highlighted
business performance, market conditions
and trends and progress against strategic
plan. Customers, suppliers and our people
were considered as part of the discussions
Finance and risk
– Approval of year-end results included
consideration of viability and
going concern
– Approval of payment of final dividend,
subject to shareholder approval in July.
Multiple stakeholders were considered,
including impact on employees and their
remuneration and working conditions,
customer and supplier propositions,
acquisitions and our shareholder base
– Discussion and approval of the
2024/25 budget
– Approval of appointment of external
Auditors, subject to shareholder approval
in July
– Approval of the Group’s risk register
and appetite
People and culture
– Bessie provided feedback from the
employee engagement session held
in April at the Shanghai, China office.
Further details can be found on page 88
ESG
– 2023/24 end of year ESG performance
and reporting
– Reviewed and approved the TCFD
statement contained within the Annual
Report and Accounts
Governance
– Evaluation of all provisions of the Code
to review compliance for the year ended
31 March 2024
– Reviewed and approved the revised
Modern Slavery Statement
JULY 2024
Strategy
– Update from Asia Pacific team highlighted
business performance, market conditions
and trends and progress against strategic
plan. Customers, suppliers and our people
were considered as part of the discussions
– Strategic update from the Customer
Experience team provided an overview
of progress against the strategy and
enabled a discussion around the identified
opportunities and execution plan
– Strategic update from the H&S team
provided the Board with an overview
of the strengthened approach to H&S
to better reflect the operating model
implemented across the Group
Governance
– Review of the schedule of matters reserved
– The Annual General Meeting (AGM) was
held. Shareholders had the opportunity to
attend, vote and raise questions directly to
the Board
BOARD ACTIVITIES
DURING THE YEAR
RS Group plc Annual Report and Accounts 202586
SEPTEMBER 2024
Strategy
– The Group Chief Information Officer,
who joined earlier in the year, provided
their first impressions on the technology
landscape of the Group, including the
current state, identified opportunities and
actions required to ensure the Group’s
technology and information infrastructure
continues to meet the requirements of the
developing business
People and culture
– A strategic update was provided regarding
the people plan. This included an update
on key initiatives and progress against
the plan. All elements of the people plan
were discussed, including culture, reward,
diversity and inclusion and engagement
Finance and risk
– An investor event took place, at which the
RS Team provided our shareholders and
potential investors with a detailed update
regarding our investment proposition,
what makes us different and our strategic
action plan. See page 9 for further details
NOVEMBER 2024
Strategy
– Update from Americas team highlighted
business performance, market conditions
and trends and progress against strategic
plan. Customers, suppliers and our people
were considered as part of the discussions
Finance and risk
– Approval of the half-year results included
consideration of going concern
– Approval of payment of an interim
dividend which was paid to shareholders
in January 2025
– The Board reviewed the principal
risks of the Group and considered
the half-year risk statement. Further
information regarding the Group’s
principal and emerging risks can be
found on pages 38 to 42
Governance
– The Group’s Speak Up policy was
considered and approved by the Board
DECEMBER 2024
Finance and risk
– An update was provided regarding the
Group’s pension scheme and strategic
options ahead of the 2025 statutory
triennial valuation
Governance
– The Board reviewed the actions against
the recommendation arising from the
prior year’s Board evaluation
– The Non-Executive Director fees for
2025/26 were considered
JANUARY 2025
Strategy
– The annual Group strategy session was
held. This provided an opportunity to
discuss key elements such as market
environment, progress against the
five-year plan and further actions required
to help ensure successful implementation
of the plan. Each of the three business
regions and accelerator functions
presented their strategic updates
Finance and risk
– An update on the tax strategy and
an overview of the key tax-related
governance controls was presented
to the Board. The Board approved the
tax strategy
ESG
– The Board received an update on ESG
performance against our 2030 ESG
action plan, along with an overview of
net zero progress, including proposed
2030 packaging and transport targets.
The refreshed double materiality results
were also presented
People and culture
– Bessie and Joan provided feedback from
the employee engagement session held
before the Board meeting with a number
of the chairs of the ERGs. The feedback
was discussed and shared with senior
management to ensure actions
were identified
MARCH 2025
Finance and risk
– The 2025/26 annual budget was
considered and approved by the Board
– The Board undertook a review of the
Group’s principal risks as at March 2025.
After consideration, the Group risk
appetite statement, including details of
the principal risks, was approved
People and culture
– Bessie and Joan provided feedback from
the employee engagement session
held before the Board meeting with
representatives from the Nuneaton and
Corby DCs and London, UK office
– The feedback was discussed and shared
with senior management to ensure
actions were identified
Governance
– The Nomination Committee considered
the findings of the internal Board
evaluation process and discussed the
key recommendations arising from it.
See pages 89 and 90 for full details
RS Group plc Annual Report and Accounts 2025 87STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
APRIL 2024
Employee engagement
In April 2024, Bessie Lee visited the
Shanghai, China office to meet with the RS
team. This was Bessie’s second visit to the
Shanghai office and first since COVID-19
restrictions were lifted. The visit provided a
comprehensive overview of the business and
comprised of:
– A tour of the office with members of the
local management team
– Introductory meetings and lunch with the
local management team
– A townhall with all employees
– An employee round table with 10
employee representatives
During the town hall, an overview of financial
performance of the Group was provided,
along with updating the team on the
vision, strategic priorities and new values.
A presentation of the growth strategy,
focusing on data insights and a data-backed
strategy was also given. The round table
session provided a more intimate setting,
with 10 colleagues who represented various
divisions and functions. Discussions were
held around adoption of new technologies
and potential in electric vehicles, AI, data
storage and alternative energy.
DECEMBER 2024 –
APRIL 2025
Shareholder engagement
An extensive programme of meetings with
our major shareholders took place between
December 2024 and April 2025 to discuss
the proposed 2025 Directors’ Remuneration
Policy (the Policy). The first phase of this
comprised initial meetings between Joan
Wainwright, the Remuneration Committee
Chair, the Company Secretary, the CPO and
Vice President, Investor Relations with our
top four shareholders who represented
c. 36% of our share register. All were
appreciative of the proactive engagement,
the quality of the materials provided and the
opportunity to provide feedback on the key
elements of the proposed framework.
As part of the second phase of engagement,
the revised Policy was shared with the
remaining top 30 shareholders (representing
just under 50% of our share register) along
with voting agencies and meetings offered
to discuss the proposals. Meetings were
held with a total of 14 shareholders, ISS,
Glass Lewis and The Investment Association.
Feedback from these meetings was
considered and informed the Remuneration
Committee’s approach. See page 110 for
further details.
Bessie was also given a demonstration of a
newly installed live streaming studio which
had been established in the office in order
to respond to a new method of promoting
products and services within China. At the
time of the visit, there had been five live
streaming sessions, one of which was a
continuous live streaming for five hours
which had generated c. 20 million views
(as at April 2024). These sessions had been
well received by both customers and the
China team.
The visit concluded with a debrief with
members of the local management team
to discuss key feedback and actions.
The general feedback from the town hall
and round table sessions was positive.
Key themes raised were around the local
market and opportunities, improvements
in supply chain and technology, new
media and use of AI. The launch of the
new values during 2023/24 had been well
received and feedback confirmed that the
values had resonated well with the team.
The local management team was newly
formed and were keen to take advantage
of the potential in the market and drive the
business forward. A detailed summary of
the visit was provided to the Board at the
May 2024 meeting and shared with the Asia
Pacific leadership team.
BOARD
ENGAGEMENT
DURING
THE YEAR
3
employee engagement
sessions held during the year
c. 86%
of our share register engaged with
regarding the Policy
RS Group plc Annual Report and Accounts 202588
Board evaluations provide invaluable insight
and objectivity to the Directors and the
Committees, which in turn enables the Board
to improve its leadership, effectiveness and
focus. Examining each Director’s role and
their corresponding responsibilities within the
overall Board dynamic encourages collaborative
decision making and strategic clarity.
The Board reflects on its performance and
effectiveness annually. During 2024/25, the
Board conducted an internal evaluation
following the previous internal evaluation
in 2023/24. The scope of the evaluation
included the Board and its Committees, along
with performance of the Chairman, Senior
Independent Director and Company Secretary.
The Chairman worked with the Company
Secretary to devise the questionnaires, which
were circulated to the Board members, the
external Auditors and Remuneration Committee
advisor. The questionnaires were supplemented
with interviews between the Chairman and
each member of the Board and the Company
Secretary. The Senior Independent Director
met with each of the Non-Executive Directors
to review the Chairman’s performance and the
feedback was subsequently shared with the
Chairman. The results of the evaluation were
assessed and discussed at the March 2025
Board meeting, following which the Board
confirmed its view that the Board continues
to operate effectively within an inclusive and
transparent environment.
Overall, there were positive improvements
in the quality of discussions and papers, in
particular, the strategy session in January 2025
provided a clear articulation of the Group’s
strategic direction.
The outcomes from the 2024/25 Board evaluation are as follows:
Key recommendations Actions agreed
Strategic discussions
– More time was requested to allow
in-depth discussions regarding
strategy along with further details
around developing areas such as AI
and technology
– Strategic papers will continue to focus on performance against competitors, key risks and opportunities,
KPIs and objectives and sufficient time to be allocated for discussion
– Further deep dives on AI, technology and digital developments to be implemented, including longer-term
horizon scanning
Board meetings
– In addition to regular Board
meetings, market visits were seen
as a vital element of the Board’s
activities and would be built into the
Board’s annual calendar
– It was agreed that market visits should form a key part of the annual meeting cycle as they provide valuable
insight into the business. It was noted that the next site visit would take place in September 2025, with a
further site visit planned for 2026. Annual site visits would be built into future annual calendars
Training and development
– Further deep dives on AI, technology
and digital advances would be
beneficial, especially in respect of
how we compare to the competition
– Focus on horizon scanning over the
next three to five years
– In addition to the deep dives (above), further training would be investigated in respect of digital, machine
learning, geopolitical tension and global portfolio management
Succession planning
– Executive Director and ExCo
succession planning was identified
as an area of key focus for the
Nomination Committee for 2025/26
– Regular succession planning updates have been built into the Nomination Committee forward agenda for
2025/26 to maintain focus on this topic
BOARD
EVALUATION
RS Group plc Annual Report and Accounts 2025 89STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Progress against the 2023/24 Board evaluation
A summary of the Board’s progress against the actions from the 2023/24 evaluation is set out below.
Key recommendations Actions agreed Progress against actions
Succession planning and talent management
– Succession planning was a key topic raised by
the Board in the review. It was acknowledged
that focus was required over the coming year to
ensure that the Group has the right pipeline of
future leaders
– Succession planning would be scheduled for review twice a year by the
Nomination Committee
– The Nomination Committee considered and discussed an update on
succession planning in March 2024. This provided a clear direction of
focus and plans for the coming year. The Nomination Committee will
monitor progress by receiving biannual updates
– Progress had been made to succession planning over the year,
particularly for Non-Executive Director roles, with updates provided by
the Nomination Committee at each meeting during the year
– Good progress had been made during the year in respect of Executive
succession planning. The ExCo had been strengthened via new
appointments. Executive succession planning would remain an area of
focus for 2025/26
Strategy
– More information and analysis on competition
in key markets, how the Group differentiates
itself and increased clarity on performance
compared to the market to be included in
Board discussions
– Regular updates to be provided in respect of
trends, investments and further development
regarding the opportunities and threats in
digital and AI
– Following the strategy session in January 2024, the forward agenda of
strategic items has been developed and was considered by the Board
in March 2024. This will be built into Board agendas for the coming year
to help ensure appropriate market and strategic information is included
within the regional performance discussions
– Strategic presentations were woven into the Board meetings throughout
the year as well as at a dedicated strategy session in January 2025.
Discussions were viewed favourably, with continued positive evolution in
the presentations and discussions along with cohesion of the team
– Deep dives into key areas were provided, including AI, technology and
customer experience
Board process
– Rebalance of agenda items to provide greater
focus on key strategic items in order to allow
more time for deep dives and discussions
and gain strategic input and insight from
the Non-Executive Directors on key issues
– To ensure items have the appropriate amount
of time for discussion, papers circulated in
advance of meetings would be taken as read
to enable presentation time to be reduced and
discussion time increased
– A more strategically focused, forward looking agenda has now been
adopted and this will be kept under review by the Chairman, Executive
Directors and the Company Secretary
– The agendas throughout the year were rebalanced with strategic items
being given sufficient focus
– Board papers have been circulated in advance and taken as read.
This has enabled more time for in-depth discussion and challenge within
the meetings
Board evaluation continued
RS Group plc Annual Report and Accounts 202590
Board appointments, time commitments and development
Appointments and
time commitments
The Chairman, Senior Independent Director
and other Non-Executive Directors each have
letters of appointment with RS Group plc and
neither serve, nor are employed in any capacity,
by the Group.
Non-Executive Directors are generally appointed
for three-year fixed terms; however, in line
with what is considered good governance
practice, all Directors are proposed for annual
re-election (or election if newly appointed)
by shareholders at the AGM, where letters of
appointment for each Non-Executive Director
are available for inspection. Each Non-Executive
Director is subject to a rigorous review at the
anniversary of each three-year term to ensure
they are still independent and have sufficient
time to dedicate to the role and evaluate their
contribution to the Board.
As illustrated on page 82, the Board has a
diverse and appropriate range of skills and
experience and works effectively in its role.
The expectation regarding time commitment
for Board members to discharge their duties
effectively is set out in the Directors’ letters of
appointment. The external commitments of
our Directors are kept under review to ensure
they have the time to contribute effectively to
the activities of the Board and its Committees
throughout the year. Any additional external
appointment taken on by a Director must be
approved by the Chairman prior to appointment,
to ensure that the Director’s ability to meet
the required time commitments to the Group
is maintained. During the year, Simon Pryce
informed the Board of his intention to take on
the role of non-executive director of Smiths
Group plc.
The Board considered the time commitment
and potential conflicts of interest involved and
was satisfied that he would continue to have
sufficient time to commit to his role as CEO and
to the RS Board.
The Board, following the annual evaluation
process, also considers whether each Director
performs effectively and demonstrates their
commitment to the role. The Board recommends
that all Directors be re-elected and Carole Cran
and Miles Roberts be elected at this year’s AGM.
As recommended by the Code, the Executive
Directors who held roles during the year
did not hold more than one non-executive
directorship in a FTSE 100 company or any other
significant appointments.
Training and induction
As part of the Board’s continuous development,
the Directors receive regular updates from
the Company Secretary as well as a schedule
of externally available briefings and training
sessions. External training includes facilitated
events, forum discussions and seminars related
to the listed company environment, many of
which were offered virtually. In 2024/25, the
Board undertook deep dives into each of our
three accelerator functions: Solutions and
Services, Customer Experience and Product and
Supply Chain, with each of the three regions
providing deep dives into their region’s culture,
business performance and market trends.
The Board also received deep dive insight from
our enabling functions: Technology (including
AI), Global Shared Business Services, H&S,
People and Finance. These sessions served
as an opportunity for the Board to gain
further insight into our operating model and
management capability.
The Company Secretary is available to all
Directors whenever needed and ensures that
both Directors and Committees have access to
independent professional advice (at the Group’s
expense) if they deem it necessary to carry out
their role effectively.
Following the appointment of any new Director,
the Chairman and Company Secretary ensure
that a customised induction to the Company
and the role of the Board is made available.
The induction programme is tailored to the
individual Director, based on their skills,
experience and needs.
New Directors are provided with an induction
pack which includes key corporate documents
and information relating to the Group, such as
the latest Annual Report and Accounts, strategy
papers, the five-year plan, M&A pipeline, the
internal audit plan and governance documents
such as the Articles of Association, Terms of
Reference of the Committees and a Directors’
responsibilities briefing.
Carole Cran and Miles Roberts joined the Board
in December 2024 and March 2025 respectively.
Details of their induction can be found below.
TAKING TIME TO BRING
CAROLE AND MILES ON BOARD
Both Carole and Miles commenced their
induction programme in advance of their
appointment dates, by meeting fellow Board
members and the ExCo in order to provide
an overview of the Group strategy, culture,
purpose, values and operations.
Meetings were also held with key members
of the senior management team who gave
valuable insight into aspects such as our
operating model with overviews of our regional
performance, each of our accelerator and
enabling functions, our ESG action plan, RS
PRO, delivery and execution, and key elements
of the finance operations.
Both Carole and Miles also met with the audit
partner, external legal counsel, our brokers
and PR agency. In addition to these meetings,
site visits have also been conducted to the
Corby and Nuneaton, UK DCs to experience
the Group’s operations first hand. Further site
visits will take place over the course of the
next year.
CASE STUDY
Ahead of joining my first meeting in
December, I spent time with each of the
Board members and the Executive Team,
understanding our strategic priorities
and getting an overview of the business.
This was invaluable background for my
first meetings. Since joining, I have visited
our operations in Corby and Nuneaton and
look forward to seeing more of the Group,
gaining a deeper understanding of the
business and meeting the broader team.
Everyone I have met has been extremely
welcoming and open, which I would like to
thank them for.”
Carole Cran
Independent
Non-Executive
Director
RS Group plc Annual Report and Accounts 2025 91STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
The UK Corporate Governance Code 2018
(the Code) applied to the financial year ended
31 March 2025. The Code is publicly available at
frc.org.uk
The Company confirms that it applied
the Principles and has complied with the
Provisions of the Code during 2024/25.
Application of the Code
The Directors’ Report is set out in a way that
helps shareholders and investors to evaluate
how the Company has applied the Principles
and complied with the Provisions of the Code
during the year. The table to the right signposts
the most relevant parts of the Annual Report
and Accounts, in particular where supporting
information is not in the Directors’ report.
COMPLIANCE STATEMENT
FOR 2024/25
Principles of the Code Pages
1. Board leadership and Company purpose
Chairman’s introduction 4,5 and 79
Our Board 80 and 81
Purpose, values and strategy 2 to 22
Culture 5, 6, 12, 17 and 56 to 60
Board stakeholder engagement and
decision making
86 to 88
Key performance indicators and
strategic performance
24 to 27
Risk assessment 36
Risk management 36 to 44
Rewarding our people 59 and 130
Whistleblowing 66 and 102
2. Division of responsibilities
Our Board 80 and 81
Board leadership and governance framework 83 to 85
Board independence and time commitments 82 and 91
Committee reports 93 to 131
Board and Committee meeting attendance 82
Principles of the Code Pages
3. Composition, succession and evaluation
Our Board 80 and 81
Board leadership and governance framework 83 to 85
Succession planning 94
Board evaluation 89 and 90
Diversity 82 and 96
Nomination Committee report 93 to 96
4. Audit, risk and internal controls
Audit Committee report 97 to 103
Statement of Directors’ responsibilities 135
Risk management 36 to 44
Review of internal controls 36 to 44 and 100
Principal risks and emerging risks 36 to 44
Going concern 44 and 99
Viability statement 43 and 44
5. Remuneration
Directors’ Remuneration report 104 to 131
Other remuneration disclosures 130 and 131
Compliance with the UK Corporate Governance Code
RS Group plc Annual Report and Accounts 202592
Key highlights
Membership as at 20 May 2025:
– Rona Fairhead (Chair)
– Louisa Burdett
– Bessie Lee
– Miles Roberts
– David Sleath
– Joan Wainwright
Activities during 2024/25
– Oversight of Non-Executive Director
selection process
– Recommendation of new Non-Executive
Director appointments to the Board
– Enhancement of talent mapping,
development and succession planning
– Oversight of the Board evaluation process
– Review of existing Non-Executive
Directors’ terms of appointment
– Review of Board Diversity and Inclusion
(D&I) Policy
Priorities for 2025/26
– Continued focus on improving the
succession planning process
– Overseeing the externally-facilitated
Board and Committee evaluation process
Dear shareholder
I am pleased to present the Nomination
Committee’s (the Committee) report for the year
ended 31 March 2025. This section of the Annual
Report and Accounts details how the Committee
discharged its duties during the year, along with
its key activities.
During the year, the Committee concentrated its
attention on Non-Executive Director succession
planning with a focus on building a high calibre
Board. After a rigorous selection process, Carole
Cran was appointed Non-Executive Director
with effect from 1 December 2024, she is also
a member of the Audit Committee. Carole has
extensive financial experience and a strong
focus on governance and risk. Carole is chief
financial officer of Halma plc, having previously
served as a non- executive director.
Following an extensive search, Miles Roberts
was also appointed as Non-Executive Director
with effect from 1 March 2025, he is also
a member of the Audit, Nomination and
Remuneration Committees. Miles joins the
Board with broad financial and operational
experience and has a strong focus on strategy,
risk and sustainability. He is non-executive
director of Land Securities Group plc and
previously served as chief executive of DS Smith
Plc (now Limited). The Committee, along with
the rest of the Board, is pleased to welcome
both Carole and Miles. Full details of their skills
and experience, along with the Non-Executive
Director selection process can be found on
pages 81 and 94 respectively.
Navneet Kapoor, Non-Executive Director,
stepped down from the Board with effect from
31 December 2024 to focus on his executive
commitments. The Committee and I would like
to thank Navneet for his valuable contribution
to RS.
The Committee continued to oversee the
Executive succession planning programme.
This included a summary of progress
undertaken during the year, review of gaps
and opportunities and planned actions for the
next 12 months to ensure the succession and
development programme continues to evolve to
meet the needs of the business.
The Board places great emphasis on benefiting
from diversity in its broadest sense. During the
year, the Committee recommended an updated
Board D&I Policy, which was subsequently
adopted by the Board. This sets out the
objectives for Board membership in respect of
diversity. Further details on the Board D&I Policy
can be found on page 95.
An internal Board evaluation was conducted
during the year, with the process being
overseen by the Committee. The findings from
the evaluation were broadly very positive, with
some areas of improvement being identified.
These will form the basis of an action plan
which will be implemented during the course
of the year, with oversight from the Committee.
The Committee also considered the actions
identified from the 2023/24 internal evaluation
and monitored progress against these.
Full details of the Board evaluation process,
outcomes and previous actions can be found on
pages 89 and 90. An external evaluation will be
conducted in 2025/26.
Rona Fairhead
Chair of the Nomination Committee
20 May 2025
KEY ACTIVITIES
DURING THE YEAR
Rona
Fairhead
Chair of the
Nomination
Committee
NOMINATION COMMITTEE
REPORT
JUL
– Succession planning for
Non-Executive Director roles
SEP
– Commenced search for possible
Non-Executive Director candidates
– Reviewed and approved Alex
Baldock’s second three-year term
as Non-Executive Director
DEC
– Succession planning for
Non-Executive Director roles
– Reviewed and approved Bessie Lee’s
second three-year term as
Non-Executive Director
MAR
– Internal Board evaluation outcome
– Board D&I Policy reviewed
– Executive succession planning
– Reviewed the Committee Terms
of Reference
– Reviewed and approved David
Sleath’s second three-year term
as Non-Executive Director
RS Group plc Annual Report and Accounts 2025 93STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Nomination Committee report continued
Board changes
With an enhanced focus on Non-Executive
Director succession planning throughout
the year, rigorous selection processes were
conducted for the appointment of two new
Non-Executive Directors – Carole Cran and Miles
Roberts. Details of the selection process can be
found to the right.
Navneet Kapoor, Non-Executive Director,
stepped down from the Board with effect
from 31 December 2024 to focus on his
executive commitments.
Succession planning
Succession planning, at both Board level and
across key senior leadership roles, remained
a key focus for the Committee during the year.
Nurturing talent is a key enabler to delivering
our business strategy and creating a
high-performance, purpose-led culture.
Executive Director succession planning
The Board recognises the importance of robust
succession planning to help nurture a diverse
pipeline of talent in current and future leaders.
The Committee is pleased with the progress
that has been made during the last year in
respect to executive succession planning.
A more robust process, together with a good
balance of bringing in external talent and
promoting from within, has enhanced the talent
succession pipeline at the ExCo and senior
management level.
The succession plans are split between
short-term and long-term requirements:
– Short-term requirements: for use in
unplanned or emergency situations,
whereby interim cover on a short-term basis
is implemented.
– Longer-term requirements: for creating
a diverse pipeline of talent within the
organisation by identifying individuals who
have potential to step into the role in the next
one to five years. Any gaps in experience and
knowledge are identified, and a development
plan devised and implemented to upskill
potential candidates.
Our succession planning process has evolved to
strengthen leadership capability, provide greater
accountability for developing key talent, drive
and monitor more action-orientated outcomes
and develop a stronger and more diverse
internal pipeline of talent through accelerated
development and hiring.
During the year, the ExCo development and
succession review was completed which
provided essential data points to enable focused
development activities for each member of the
ExCo. In addition to this, all ExCo roles now have
in place a succession plan for the next five years.
There is an annual process whereby all
individuals throughout the Group undergo
regular performance reviews and are
responsible for their own development plans,
with oversight and support provided by line
managers. In addition to this, an ongoing
succession planning process is in place to
identify talent and successors to senior
leadership roles, and to highlight any potential
retention risks. For details of our talent
programme, see page 59.
Our succession planning for senior leaders can
be split into two tiers: the first for the Executive
Director positions, and the second for key senior
management roles.
Over the last year, the team has implemented
a robust talent policy and process for all senior
manager hires which includes an assessment
of the candidate against our new leadership
framework and competencies. This policy also
ensures that it is a diverse and inclusive process.
The Committee is pleased to see that, in 2025/26,
we will be launching our new Leadership
Advantage Programme where c. 100 senior
leaders will embark on an 18-month leadership
development journey with our selected global
business school partner.
The Committee will continue to review and
monitor the succession planning process,
including performance and talent ratings,
to ensure it is effective and appropriate for
the Group.
Non-Executive Director succession planning
Throughout the year, the Committee continually
considered the Board’s balance of skills and
experience to ensure the overall composition of
the Board remains appropriate. This approach
also enables the Committee to identify any
skills gaps and to build role profiles quickly
when needed. During the year, the Committee
commenced the process to recruit additional
independent Non-Executive Directors, to ensure
the optimum balance of skills and experience on
the Board.
Consideration is also given to the
Non-Executive Director tenure. A review
process was introduced during the year,
whereby those Directors who reach a three
or six year anniversary from the date of their
appointment, are considered by the Committee,
taking into account length of tenure, time
commitments and continued independence.
Non-Executive Director
recruitment process
1
Appointment of Russell Reynolds
Associates (Russell Reynolds) as
non-executive search specialist.
A role profile was developed with
input from Russell Reynolds for each
non-executive position, including
detailing essential skills and
experience requirements.
2
A diverse longlist of candidates was
produced as a result of a global search
conducted by Russell Reynolds, based
on the role profile requirements
and market.
3
Interviews were held with each
candidate and Rona Fairhead,
Simon Pryce and various
Non-Executive Directors.
4
Preferred candidates were considered
by the Nomination Committee and
their appointments recommended
to the Board.
RS Group plc Annual Report and Accounts 202594
Diversity and inclusion
During the year, the Committee approved
an updated Board D&I Policy. This provides
a high-level overview of the Board’s approach
to driving D&I in our succession planning,
selection, nomination, operation and evaluation
of the Board. This policy works in conjunction
with our wider Group D&I Policy.
Policy statement
We believe in creating an inclusive and engaging
environment where everyone is proud and
excited to come to work and can perform at
their best, develop and thrive. We are proud
to support our people to be their best by
building an inclusive workplace that supports
everyone, irrespective of ethnicity, disability,
socio-economic backgrounds, mental health
conditions, neurological divergence, age,
religion, sexual orientation or gender identity.
The Board places great emphasis on ensuring
that its membership reflects diversity in
its broadest sense. We believe a key driver
in delivering our organisational diversity
commitments is through a Board which has
a balance of skills, personal and cognitive
strengths, experience, independence and
knowledge. Consideration is given to the
combination of demographics, skills, experience,
ethnicity, age, gender and other relevant
personal attributes on the Board to provide the
range of perspectives, insights and challenge
needed to support good decision making.
New appointments are made on merit, taking
account of the specific skills and experience,
independence and knowledge needed to
ensure a diverse and rounded Board and the
benefits each candidate can bring to the overall
composition of the Board and its Committees.
Objectives
Objectives for achieving Board diversity are
periodically reviewed. The Board aspires to be
comprised of:
– At least 40% women
– At least one of the senior Board positions
(Chair, CEO, CFO or Senior Independent
Director) is a woman
– At least one Director from an ethnically
diverse background
The Board acknowledges that in periods of
Board change, there may be times when this
balance is not maintained. Reflecting these
aspirations, the Board will aim to meet any
recommendations set out by the FTSE Women
Leaders Review (formerly Hampton-Alexander
Review) and the Parker Review.
As at 31 March 2025, all of the above targets
had been met. The Board is comprised of 60%
women and 10% from an ethnically diverse
background, with two senior positions held
by women.
The Board places high emphasis on ensuring
the development of diversity in the senior
leadership roles across the Group and supports
and oversees the Group’s ambition to ensure
our team reflects the customers, suppliers and
communities we serve.
Currently, this Policy is not applied to Board
Committees individually, although we strive
to apply similar representation across the
Committees. The Board is comfortable that the
diversity of the Board is reflected across the
Committee memberships and that this remains
an ongoing consideration.
Responsibilities, monitoring and reporting
The Chairman of the Board will lead the Board’s
diversity agenda and set measurable objectives,
with the aim of continuously improving D&I
generally, ultimately leading to better debate
and decision making.
The Board will be expected to role model
inclusive language, behaviours and practice in
all undertakings for and on behalf of the Group,
setting a clear tone from the top.
The Committee is responsible for ensuring
that the Board has the right balance of skills,
experience and knowledge and, in accordance
with its Terms of Reference, shall:
– Regularly review Board composition
– Monitor and drive succession planning, talent
development and the broader aspects of D&I
for both Executive Directors and the ExCo
– For any Director appointments, work
with executive search firms that reflect
and understand the Group’s values and
approach to diversity, including this Policy,
and will honour those values and approach
in identifying and proposing suitable
candidates for appointment to the Board and
its Committees
– Identify suitable candidates for appointment
to the Board on merit against objective criteria
having regard to:
– The benefits of diversity in promoting the
success of the Group for the benefit of its
shareholders as a whole
– The skills, experience, background,
independence and expertise of current
members of the Board and its Committees
– Report annually in the Governance Report
of the Annual Report and Accounts on
the implementation of the Board D&I
Policy and other matters as required
by the Code and other regulatory and
statutory requirements
– Review the Board D&I Policy at least
annually and recommend any revisions to
the Board
RS Group plc Annual Report and Accounts 2025 95STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Nomination Committee report continued
Board evaluation
The Committee, led by the Chairman of the
Board, is responsible for overseeing the
Board evaluation process. This year, the Board
underwent an internal evaluation.
The Committee also considered the remaining
actions taken in response to feedback from the
previous internal review undertaken in 2023/24
and monitored progress against the agreed
actions. Full details of both the evaluation and
actions against the previous year’s evaluation
are provided on pages 89 and 90.
Committee governance
Committee structure and meetings
The Committee is comprised of independent
members. Navneet Kapoor stepped down from
the Committee in December 2024 and Miles
Roberts was appointed to the Committee in
March 2025. There were no further changes to
the Committee membership during the year.
The Committee held three scheduled meetings
during the year and held a further one
unscheduled meeting to consider Alex Baldock’s
second three-year term. Details of attendance at
meetings can be found on page 82.
In addition to the members, the regular
attendees at the meetings of the Committee
have included the CEO, CFO, CPO and the
Company Secretary.
The Committee Chair attends the Company’s
AGM and is happy to answer any questions
from shareholders on matters falling within the
Committee’s responsibilities.
Meetings of the Committee generally take place
shortly before Board meetings and activities of
the Committee are reported by the Chair to the
Board as a separate agenda item.
Committee responsibilities
The Committee’s chief responsibilities have
not changed during the year. The Committee’s
Terms of Reference are reviewed formally and
approved annually and set out its principal
duties in full, including its authority to carry out
its duties. These are available at rsgroup.com
Committee evaluation
As part of the internal evaluation, the Committee
examined its own performance and operational
effectiveness. The Committee members agreed
that the meetings continued to be well run
with appropriate levels of detail presented.
All respondents felt well informed and involved
in the specification and approach to the
Non- Executive Director appointment activity
which occurred during the year. As reported on
page 89 there was strong feedback in respect
of the need to provide further strengthening of
succession planning in the coming year.
The overall findings of the evaluation
demonstrated that the Committee operated
effectively and continues to discharge its duties
in line with its Terms of Reference.
Diversity statistics as at 31 March 2025
Reporting table on gender representation
Number
of Board
members
Percentage
of the Board
Number of senior
positions on the
Board (CEO, CFO,
SID and Chair)
Number of
ExCo members
Percentage
of the ExCo
Men 4 40% 2 7 64%
Women 6 60% 2 4 36%
Not specified/prefer not to say 0 0 0 0 0%
Reporting table on ethnicity representation
Number
of Board
members
Percentage
of the Board
Number of senior
positions on the
Board (CEO, CFO,
SID and Chair)
Number of
ExCo members
Percentage
of the ExCo
White British or other White
(including minority-white groups)
9 90% 4 11 100%
Mixed/Multiple Ethnic Groups 0 0 0 0 0%
Asian/Asian British 1 10% 0 0 0%
Black/African/Caribbean/
Black British
0 0 0 0 0%
Other ethnic group 0 0 0 0 0%
Prefer not to say 0 0 0 0 0%
Not specified 0 0 0 0 0%
Gender and ethnicity representation
The Financial Conduct Authority, in its capacity as
the UK Listing Authority, introduced rules during
2022 that require listed companies to publish
information on gender and ethnic representation
on the Board and in executive management roles
(Listing Rule UKLR 6.6.6R (9) and (10)). The tables
below outline the current gender and ethnic
diversity of the Board and our ExCo.
Methodology of data collection
Data in respect of our senior leaders, including
our ExCo, is compiled through our employee
database and collected on a self-reporting basis.
Data in respect of the Board is collected on a
self-reporting basis and agreed directly with the
Board members.
Throughout the 2024/25 Annual Report and
Accounts, the information we disclose is in
accordance with our reporting obligations
as a UK registered company listed on the
London Stock Exchange. We continue to keep
our policies and procedures under review
to ensure ongoing compliance with the laws
and regulations of the jurisdictions in which
we operate, including any anti-discrimination
regimes as they evolve.
RS Group plc Annual Report and Accounts 202596
AUDIT COMMITTEE
REPORT
Dear shareholder
As Chair of the Audit Committee (the
Committee), I am pleased to present the
Committee’s Report for the year ended
31 March 2025. The purpose of this Report
is to describe the work undertaken by the
Committee and explain how it has discharged
its responsibilities throughout the year.
The Committee’s main role is to monitor and
review the integrity of the Company’s financial
information. This includes recommending to
the Board whether the Company’s Annual
Report and Accounts, taken as a whole, is fair,
balanced and understandable and whether
the assessment of the Group’s going concern
assumptions and longer-term viability are
reasonable. The Committee is also responsible
for providing assurance to the Board that the
Group’s internal controls and risk management
systems are fit for purpose and regularly
reviewed, as well as overseeing the effectiveness
and independence of the external Auditors,
including recommending to the Board the
approval of their fees and appointment on an
annual basis. Deloitte were appointed as the
Company’s external Auditors at the 2024 AGM
and 2024/25 is their first full year of auditing
the Company.
We continued to see professional,
comprehensive and robust work in all areas
which has meant that the Committee has been
able to discharge its obligations seamlessly
throughout the year.
The Committee has continued to focus on the
Group’s financial reporting, including approving
the disclosures in relation to geopolitical
uncertainties and climate change, the Group’s
going concern and viability statements and
the Group’s use and definitions of alternative
performance measures. The Committee has
continued to focus on the key accounting
matters set out on pages 99 and 100. All of these
matters were conducted to the satisfaction of
the Committee.
We continue to monitor the Group’s progress on
its ICFR programme to strengthen and formalise
its financial processes and controls framework.
The Director of Controls, who joined the Group
in early 2025, will expedite this progress by
collaborating with global process owners as
part of the Group’s Process and Operational
Excellence programme. This initiative aims to
ensure that all material controls are in place and
fully operational, positioning the Group well for
compliance with the Updated Code provisions.
The Committee has spent some time
understanding all emerging ESG legislation
and the related disclosures and reviewed the
Group’s reporting approach to it, including the
fourth year of reporting the climate-related risks
and opportunities in relation to the Group’s
obligations under TCFD (see pages 68 to 73).
Work has progressed during the year to ensure
the Group is well placed to comply with future
legislation and pivot to accommodate proposed
changes to CSRD, including review of the
refreshed double materiality assessment.
As part of its duties, the Committee has continued
to review the Group’s information security and
data protection controls. The Committee also
continued to ensure that appropriate procedures
were in place for the detection and prevention of
fraud and received regular updates relating to the
Group’s whistleblowing facility, further details of
which can be found on page 102.
On behalf of the Committee, I would like to thank
our internal audit and finance teams for their
contribution over the past year. I would also like
to add thanks to Deloitte for their role as Group
Auditor and providing a smooth transition from
the previous Auditors.
I will be available, as usual, at this year’s AGM to
answer any shareholder questions in relation to
audit matters.
Louisa Burdett
Chair of the Audit Committee
20 May 2025
Louisa Burdett
Chair of the Audit
Committee
Key highlights
Membership as at 20 May 2025
– Louisa Burdett (Chair)
– Alex Baldock
– Carole Cran
– Miles Roberts
– David Sleath
Activities during 2024/25
– Oversight of the transition from
PricewaterhouseCoopers LLP to Deloitte
LLP (Deloitte) as new external Auditors from
2024/25
– Reviewed and monitored the Group’s
approach to risk, the risk management
process and its internal control system
– Evaluation of the performance of the
internal audit function
– Reviewed the progress in respect of the
Group’s review of internal controls over
financial reporting (ICFR)
– Continued to monitor the Group’s progress
in the review of the impact assessment
of the Financial Reporting Council’s (FRC)
updated UK Corporate Governance Code
2024 (the Updated Code) in relation to
internal controls, any necessary changes
to the Group’s ICFR and the extension to
include all material controls
– Reviewed the Group’s ESG reporting
approach, including the update on its
climate-related risks and opportunities
in relation to TCFD and preparedness for
future CSRD alignment
– Reviewed the integration of Distrelec
and assessed the improvements in the
effectiveness of its internal control systems
Priorities for 2025/26
– Monitor the Group’s progress on refining
and adjusting the material controls to
comply with the Updated Code, including
ensuring that appropriate procedures are
in place for the detection and prevention
of fraud
– Continue to prepare for known legislative or
regulatory changes whilst monitoring any
upcoming legislation and the associated
impacts on RS Group
– Continue to focus on principal risks,
including the evolving cybersecurity
threat landscape
– Continue to ensure our external Auditors
maintain a high standard of audit quality
and are sufficiently challenging to
management in the course of its work
– Continue to oversee the preparation for the
new compliance requirements for ongoing
ESG reporting
RS Group plc Annual Report and Accounts 2025 97STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Audit Committee report continued
KEY ACTIVITIES
DURING THE YEAR
FAIR, BALANCED AND UNDERSTANDABLE
The Board is required to confirm to the Company’s
shareholders that the Annual Report and Accounts, taken as
a whole, is fair, balanced and understandable and provides
the necessary information and key messages to enable
shareholders and other stakeholders to assess the Group
and the Company’s position, performance, business model
and strategy. The Committee advises the Board on whether
this confirmation can be made and the Committee assesses
whether it can make this recommendation to the Board by
following its regular, robust approach which is:
– Ensuring regulatory requirements for the Annual Report
and Accounts were thoroughly understood.
– Reviewing draft copies of the Annual Report and Accounts
to assess and advise on direction and key messages, with
a near final version provided to the Committee and Board
prior to sign-off of the Annual Report and Accounts.
– Assessing management’s fair, balanced and
understandable verification process and reviewing its
results. This included a cascaded sign-off across the Group
to determine the accuracy, consistency and clarity of the
data, information and language.
– Reviewing the use and disclosure of alternative
performance measures and confirming its belief that
separate disclosure of these measures enables readers
of the Annual Report and Accounts to understand better
the underlying financial and operating performance
of the Group. The alternative performance measures
are consistent with prior years. The definitions and
reconciliations of alternative performance measures are set
out in Note 3 on pages 154 to 158.
– Ensuring that a thorough review of the Annual Report
and Accounts was undertaken by all appropriate parties,
including external advisors.
The Committee has reviewed the Annual Report and
Accounts for the year ended 31 March 2025 and has
advised the Board that, in its opinion, the Annual Report
and Accounts, taken as a whole, is fair, balanced and
understandable and provides the information necessary
to assess the Group’s position and performance, business
model and strategy.
MAY
– Reviewed the year-end key accounting judgements and
issues (including tax) and approved their accounting
treatment; viability and going concern; and fair, balanced
and understandable criteria for recommendation to
the Board
– Received a report in respect of the RS Integrated Supply
performance and control environment
– Reviewed the ESG performance against our 2030 action
plan targets, and considered the ESG related disclosures
for year end, including the TCFD statement and financial
scenario analysis recommendation to the Board
– Recommended to the Board for approval the adoption
of the Annual Report and Accounts for the year ended
31 March 2024 and the full-year results announcement
– Reviewed non-audit fees and the Non-Audit Services
Policy and recommended the Non-Audit Services Policy
to the Board for approval
– Recommended to the Board for approval the
appointment of Deloitte as Auditors for 2024/25
– Reviewed updates regarding internal audit reports,
information security and quarterly whistleblowing report
– Reviewed the Committee’s Terms of Reference and
recommended adoption to the Board
JUL
– Reviewed Group internal audit remit and performance
– Quarterly review of non-audit fees completed
– Approved Deloitte’s audit plan for 2024/25
– Received reports from the Data Protection Officer and
quarterly whistleblowing report
– Review of internal audit reports
NOV
– Received the half-year key accounting judgements and
issues (including tax) and approved their accounting
treatment; going concern; and fair, balanced and
understandable criteria for recommendation to
the Board
– Reviewed the draft interim results for recommendation
to the Board
– Quarterly review of non-audit fees completed
– Received an update on the CSRD compliance programme
– Reviewed updates regarding internal audit reports and
quarterly whistleblowing report
JAN
– Received the Group internal audit update, reviewed the
Group’s risk and control assessment and approved the
2025/26 internal audit plan
– 2024/25 ESG reporting approach agreed, including TCFD
actions and disclosure and transition approach to CSRD
reporting and compliance roadmap
– Received an update on emerging ESG
reporting regulations
– Received an update on the FRC evaluation of auditors
– ICFR update received, including a summary of primary
focus areas and a high-level roadmap to compliance with
Provision 29 of the Updated Code
– Quarterly review of non-audit fees completed
– Received a report from the Data Protection Officer
– Reviewed the annual whistleblowing arrangements and
the quarterly whistleblowing report
– Reviewed the Committee’s Terms of Reference and
recommended adoption to the Board
RS Group plc Annual Report and Accounts 202598
Financial reporting
The primary role of the Committee in relation
to financial reporting is to monitor the integrity
of the Group’s published financial information,
including reviewing its full-year and half-year
financial results. The Committee undertakes
this with both management and Deloitte and
concentrates on ensuring compliance with the
relevant financial and governance reporting
requirements. The Committee considers the
principal accounting policies that are used when
preparing these results as well as reviewing
the significant accounting issues and areas of
judgement made as noted below and other key
areas of focus as noted on page 100. Also, this
includes the fair, balanced and understandable
review as described in more detail on page
98. The Committee receives regular reports
from the CFO and Group Financial Controller to
support this work.
Significant accounting issues and areas of
judgement
Management is required to exercise judgement
in a number of areas when preparing the
Group accounts and the Company accounts.
The Committee focuses on any significant
areas of judgement that may materially impact
the Group’s and Company’s reported results
and assesses and challenges, if necessary,
whether these judgements are reasonable
and appropriate. The Committee also
reviews the clarity and transparency of the
related disclosures.
The significant accounting issues and areas of
judgement considered by the Committee during
the year, and how these were addressed, are set
out to the right.
Significant accounting issues and areas of judgement
Inventories valuation
Inventories represent a material proportion of the Group’s net assets. During the year-end process,
a system- and process-related issue was identified within the US operations, where certain
inventory items were incorrectly allocated across stock categories. Consequently, these items did
not receive the appropriate provisioning in line with Group policy. Furthermore, an unsupported
deviation from Group inventory provisioning policy has been identified. As a result, a detailed
review of historical data has been undertaken in relation to both issues, and a restatement of prior
years has been included in the Financial Statements. For further details, refer to Note 32 on pages
191 to 195.
At 31 March 2025, the Group had £617.3 million (2023/24 restated: £637.4 million) of inventories on
the balance sheet. This valuation includes the cost of attributable overheads. Judgements are made
in estimating the net realisable value of inventories to determine the level of inventory provision.
At 31 March 2025, inventory provisions were £86.8 million (2023/24 restated: £86.9 million).
Sensitivity analysis on the assumptions was performed, including consideration of any reasonably
likely change in assumptions including the current global economic uncertainty and longer-term
impacts of climate change and environmental regulations. See Note 18 on page 174.
How the Committee addressed these matters and conclusions reached
The judgements made in the methodology used to estimate the net realisable value relate to the
number of years of sales required to sell through and the value recoverable from these inventories.
These assumptions are based on recent experience and knowledge of the products on hand
and are reviewed regularly. This assessment includes consideration of the sales growth pattern
for new product launches and decay rates over the product lifecycle. The impact of the current
global economic uncertainty and the longer-term impacts of climate change and environmental
regulations on these assumptions were considered and the assumptions were adjusted where
necessary to ensure they remain appropriate. The latest review was presented to the Committee
and it reviewed and agreed the reasonableness of the assumptions.
The Committee also reviewed the error explained above and the proposal to address this through
a restatement and, given it represents an error in prior periods, agreed with the approach given
the quantum of the adjustment and its nature.
Going concern and viability statements
As part of the Committee’s responsibility to
provide advice to the Board, the Committee
reviewed and challenged the Group’s going
concern assumptions at the half year and full year
and reviewed and challenged the process and
assessment of the Group’s longer-term viability at
the full year.
Management included a going concern statement
in the Group’s half-year report. The Committee
reviewed the process conducted to prepare
this statement, including the assumptions used
in the reverse stress tests. It recommended to
the Board that it was appropriate to continue to
adopt the going concern basis in the half-year
results. The Committee also reviewed and agreed
the wording of the going concern statement and
recommended its approval to the Board.
For the viability statement and going concern
statement in the Annual Report and Accounts,
the Committee reviewed the assessment period
and reviewed and challenged the scenarios
considered for each principal risk and the
determination of severe but plausible stress
tests and reverse stress tests. The Committee
reviewed the outcomes of these stress tests and,
as a result, recommended to the Board that it is
able to confirm the Group’s viability statement
and the going concern statement. Details of these
statements can be found on pages 43 and 44 of
the Strategic Report.
Other key areas of focus
The Committee also reviews a number of
other key areas that require management to
exercise judgement. These judgements have
not had a significant effect on the amounts
recognised in the accounts in the year ended
31 March 2025 nor are they significant estimates
which have a significant risk of resulting in a
material adjustment to the carrying amounts
of the Group’s assets and liabilities within the
next year. However, the Committee focuses on
these areas to ensure these judgements are also
reasonable and appropriate and to ensure they
have not become significant.
RS Group plc Annual Report and Accounts 2025 99STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Audit Committee report continued
These other key areas of focus in the year were:
Other key area of focus
Impairment of goodwill and other assets
There is £616.4 million of goodwill on the balance sheet at 31 March 2025 (2023/24: £646.3 million).
Judgements are made in relation to the assumptions used in the value-in-use models which are
used to assess impairment of goodwill and other assets when there are indicators that they may
be impaired.
How the Committee addressed these matters and conclusions reached
The value of goodwill is reviewed regularly for impairment using value-in-use models using cash
flows and discount rates as set out in Note 14 on pages 170 and 171. The Committee reviews these
impairment tests every year, including the main assumptions. These assumptions also include
consideration of the impact of climate change.
The Committee agrees with the tests’ confirmation that there remains adequate headroom in place
and no impairment provision is required. Other assets are regularly reviewed to identify if there are
any indicators that they may be impaired. If any significant impairments are found, the Committee
will also review these impairment tests, including the main assumptions, confirming that the
valuation is reasonable. During the year, an impairment was recognised on some of the assets of
the RS Integrated Supply EMEA business; the Committee reviewed and agreed with this impairment
and the disclosure in Note 14 on pages 170 and 171.
The Committee also reviewed and agreed with the trade receivable impairment allowance and
disclosure in Note 19 on page 175.
Other matters
The Committee also carried out a range of other
activities in relation to financial reporting during
the year which included:
– Reviewing the impact of amendments to
accounting standards adopted during the year
– Reviewing the effective tax rate, judgements
made in relation to the levels of tax
contingencies for potential challenges by local
tax authorities and recoverability of losses,
and relevant disclosures
– Reviewing and agreeing the accounting
treatment and disclosure of any potential
post-balance sheet events at both the half
year and full year
– Agreeing with management’s assessment
that there are no indicators of impairment
for the investments the Company holds in
its subsidiaries
Internal control and risk
management
The Vice President Group Operational Audit
and Risk (VP Audit and Risk) provides quarterly
reports to the Committee which cover the
performance of the Group’s system of internal
controls and its effectiveness in managing
the Group’s principal risks and identifying any
control failings or weaknesses. These reports
highlight matters which might impact the
delivery of the Group’s key strategic objectives
or which indicate improvement is required
in any of the Group’s processes or controls.
The Committee carefully considers these
findings and discusses appropriate actions
where necessary.
An annual review of the Group’s risk
management processes is undertaken by
the Committee, as required by the Code, the
FRC Guidance on Audit Committees and the
recommendations of the FRC Guidance on Risk
Management, ICFR and Business Reporting.
These processes include material controls which
cover ﬁnancial, operational and compliance
controls and risk management systems.
The outcomes of these reviews are shared with
the Board.
These, in combination with other updates to the
Board on the Group’s principal risks, allowed the
Board to assess the effectiveness of the Group’s
systems of internal control and residual risk prior
to making its statement in this Annual Report
and Accounts. Further information regarding the
Group’s principal risks can be found on pages 38
to 42 of the Strategic Report.
The internal control system and risk
management process have been in place during
the year and up to the date of this Annual Report
and Accounts. In the event weaknesses are
identified in the internal control system, plans
for strengthening them are put in place and then
regularly monitored.
Internal ﬁnancial controls
Internal ﬁnancial controls are the systems
that the Group employs to support the Board
in discharging its responsibilities for ﬁnancial
matters and the financial reporting process as
described on page 135.
RS Group plc Annual Report and Accounts 2025100
The main elements include:
– Assessments by internal audit on the
effectiveness of operational controls
– Clear terms of reference setting out the
duties of the Board and its Committees, with
delegation to management in all locations
– Group Finance and Group Treasury manuals
outlining accounting policies, processes
and controls
– Weekly, monthly, quarterly and annual
reporting cycles, including targets approved
by the Board and regular forecast updates
– Local leadership teams reviewing financial
results against forecast and agreed
performance metrics and targets with overall
performance reviewed at region, business and
Group levels
– Speciﬁc reporting systems covering treasury
operations, tax, major investment projects
and legal and insurance activities, which are
reviewed by the Board and its Committees on
a regular basis
– Whistleblowing procedures allowing
individuals to report fraud or financial
irregularities and other matters of concern
The Updated Code was published in
January 2024. The Group has increased focus on
adjusting existing financial reporting controls
with the aim to improve and build on our
existing financial reporting controls focused on
key risk areas and to extend to other relevant
internal control areas impacted by the Updated
Code which will apply to the Group’s year ending
31 March 2027. The Committee will continue
to monitor the Group’s progress against these
new requirements.
Internal audit
The work of the internal audit function spans the
whole Group, including, as and when relevant,
acquired businesses, and provides independent
and objective assurance over the Group’s
systems of internal controls through a risk-based
approach. The Committee reviews and approves
the scope and resourcing of the internal audit
plan annually with the VP Audit and Risk.
The scope of the plan is determined by reference
to the Group’s operating risks and strategy as
well as geographic, functional and external risks.
The Committee reviews:
– The level and skills of resources allocated to
the internal audit function to conduct this
programme of work
– The summary of the results of each audit and
the business team’s resolution of any control
issues identified
– The effectiveness of the internal audit function
The VP Audit and Risk has regular, open access
to the Committee Chair. Discussions focus
on audit planning and matters noted during
internal audit assignments. Other members of
the Committee are also available as required.
The Committee meets with the VP Audit and
Risk without the presence of management at
least once a year. Mark Taylor, who has held the
position of VP Audit and Risk for the last 12 years,
is retiring in May 2025. The Committee would like
to thank Mark for his commitment and diligence
over the years. The Committee would also like to
welcome Chris Curtis as Mark’s replacement and
looks forward to working with him.
Other activities
During the year, the Committee has maintained
its focus on current and emerging ESG-related
regulations and compliance requirements.
The Committee has received in-depth updates
from the ESG team in respect of actions taken to
date regarding the Group’s approach to CSRD
readiness, along with a review of next steps
required during 2025/26. Regular updates are
also provided on the future ESG compliance
landscape, highlighting key actions required to
meet those requirements, along with a timeline.
It discussed and agreed the ESG reporting
requirements for 2024/25 and future years,
including Scope 3 emissions and additional
disclosures in the Group’s fourth TCFD report
included in this Annual Report and Accounts.
The Committee was comfortable that the
disclosures contain appropriate and accurate
data and information and recommended to the
Board that it approve the ESG disclosures in
this Annual Report and Accounts, including the
TCFD report.
The Committee continued its reviews of the
data protection compliance programme
through reports from the Data Protection
Officer. The Committee continued to provide
oversight of the Group’s compliance with laws
regarding the protection of personal data
across its operations, including the General
Data Protection Regulation and the UK’s Data
Protection Act.
The Committee received regular reports from
the Data Protection Officer, highlighting ongoing
compliance work such as training, targeted
training for high risk teams and awareness
campaigns to embed a culture of privacy by
design, as well as assessments of the impact
of material changes to the Group’s operations
on its handling of personal data (such as
significant changes to systems and integration
of acquisitions) and monitoring of changes in the
regulatory environment.
External Auditors
Effectiveness and independence
The Committee is responsible for reviewing
the performance and effectiveness of the
external Auditors, as well as their appointment
and remuneration.
Deloitte were appointed to act as the external
Auditors for the first time this year, therefore a
review of their performance and effectiveness
has not been undertaken during the year under
review. A review will be conducted during
2025/26 and the outcome will be reported on
in the 2025/26 Annual Report and Accounts.
The Committee has considered the FRC’s Audit
Quality Inspection report on audits performed
by Deloitte for 2023/24, published in July 2024.
During the year, the Lead Audit Partner, Jon
Thomson, and the Group Second Partner
together with other relevant and appropriate
members of the Deloitte audit team, attended all
of the Committee’s meetings. Deloitte provided
reports and conclusions on the Group’s key
accounting judgements, internal control
processes and half-year report.
RS Group plc Annual Report and Accounts 2025 101STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Audit Committee report continued
Further details of how the Committee and the
external Auditors work together, as well as
how the external Auditors’ independence is
maintained, can be found in the governance
section of our website. As in previous years’
reports, the Committee can confirm that the
Group does not engage Deloitte to undertake
any work that could affect its independence.
The Committee has satisfied itself that the
Company has complied with the provisions
of the Statutory Audit Services for Large
Companies Market Investigation (Mandatory Use
of Competitive Processes and Audit Committee
Responsibilities) Order 2014, published by
the Competition and Markets Authority on
26 September 2014.
Non-audit assignments undertaken
by the Auditors
The Group operates a policy to ensure that
the provision of non-audit services does not
impair the external Auditors’ independence
or objectivity and that only permitted services
are provided. In determining this policy, the
Committee took into account possible threats
to the external Auditors’ independence
and objectivity.
The policy on non-audit services includes:
– In providing a non-audit service, the external
Auditors should not:
– Audit their own work
– Make management decisions for the Group
– Create a mutuality of interest
– Find themselves in the role of advocate for
the Group
– The total non-audit fees for any financial year
should not exceed 70% of the average of the
external audit fee over the last three years.
In practice, the non-audit fees are normally
significantly below this level.
The policy also states that the Committee has
pre-approved the CFO to have authority to
commission the external Auditors to undertake
non-audit work (not covered to the left) where
there is a specific project with a cost that is
not expected to exceed £50,000. Any fees
above £50,000 must be pre-approved by
the Committee.
Full details of our policy in relation to non-audit
services can be found on the governance section
of our website. This policy was reviewed by the
Committee during the year and no changes
were required.
During the year under review, there were
audit-related assurance services and
non-audit fees of £0.1 million for Deloitte
compared to audit fees of £4.1 million. £40,000
of the non-audit fees relate to the double
materiality assessment pre-assurance work
completed. Further information on fees payable
to Deloitte are included in Note 6 on page 159.
The Committee has satisfied itself that its use
of the external Auditors complies with both
the Code and the FRC’s Ethical and Auditing
Standards regarding the scope and level of
non-audit work and non-audit fees incurred by
the Group.
Fraud
The Committee is responsible for reviewing
the Group’s procedures for the prevention and
detection of fraud. Suspected cases of fraud
must be reported to the Company Secretary
or General Counsel within 48 hours and
investigated by operational management, Group
Compliance or internal audit, as appropriate.
The outcome of any investigation is reported to
the Company Secretary, General Counsel and
the CFO. A register of all suspected fraudulent
activity and the outcome of any investigation
is maintained and circulated to the Board on a
regular basis, with the Committee also receiving
regular updates.
The Group takes steps in line with good
business practice to detect and prevent
fraudulent activity, and is preparing for the
new requirements of the Economic Crime and
Corporate Transparency Act related to fraud
prevention. The Committee is pleased to report
that there were no frauds of a material nature
discovered during the year, although the Group
is subject to various attempts at external and
low-level credit card and online fraud.
Whistleblowing
In accordance with the provisions of the
Committee’s Terms of Reference, the Committee
is responsible for reviewing the arrangements
whereby all of the Group’s employees may, in
conﬁdence, raise concerns about illegal, unethical
or improper behaviour or other matters and for
ensuring that these concerns are investigated
and escalated as appropriate. Reports may
be raised directly to senior management or
through an external third-party reporting tool.
Whistleblowing is referred to internally as Speak
Up and is available to all of the Group’s employees.
The Committee receives aggregated reports
on matters raised through these services and
monitors their resolution. The Group’s existing
policies and procedures (adopted globally)
have been updated to reflect the ongoing
implementation across EU Member States of
the 2021 European Whistleblowing Directive.
An awareness campaign was also launched
across the Group during the year. The Group
will continue to monitor any national laws that
implement additional, relevant requirements
and make any required changes to policies and
procedures where appropriate. For further
information see page 66.
Committee governance
Committee structure and meetings
The Committee acts independently of
management to ensure the interests of our
shareholders are protected properly in relation
to financial reporting, risk and internal control.
All members of the Committee are independent
Non-Executive Directors, with sufficiently
wide-ranging business experience, expertise
and competence to enable the Committee
to fulfil its responsibilities effectively.
Navneet Kapoor stepped down from the
Committee in December. Carole Cran and
Miles Roberts joined the Committee during the
year. Louisa Burdett is a chartered accountant
and, having held senior financial management
positions, has extensive knowledge and
experience of financial markets, treasury,
risk management and financial accounting
standards. Biographies for the Committee
members are set out on pages 80 and 81.
The Committee held four scheduled meetings
during the year. Meetings were held in line
with the ﬁnancial and reporting cycles of the
Company. Meetings are generally held prior to
Board meetings so that optimum collaboration
with the Board is maintained. The Committee
Chair provides updates to the Board on the
proceedings, considerations and findings of
each meeting.
The Committee Chair extends invitations
to certain other key individuals to attend
meetings, including the Chair of the Board, other
Non-Executive Directors who are not members
of the Committee, the CEO, CFO, the Company
Secretary, Group Financial Controller, VP Audit
and Risk and the external Auditors. The Data
Protection Officer attends meetings twice a year
to give updates on data protection matters.
RS Group plc Annual Report and Accounts 2025102
During the year, the Committee held separate
sessions with the VP Audit and Risk and the
external Auditors without the presence of
management. The VP Audit and Risk and
the external Auditors have direct access
to the Committee Chair outside of formal
Committee meetings.
Committee responsibilities
The Committee’s chief responsibilities have
not changed during the year. The Committee’s
Terms of Reference are reviewed formally and
approved annually and set out its principal
duties in full, including its authority to carry out
its duties, and are available in the governance
section of our website: rsgroup.com
The core functions of the Committee include:
– Supporting the Board in ensuring the integrity
of the ﬁnancial and corporate reporting and
auditing processes
– Assisting the Board in assessing the
long-term viability of the Group by reviewing
and challenging the scenarios considered and
severe but plausible stress testing performed
on the principal risks
– Advising the Board on whether the half-year
and full-year financial reports present a fair,
balanced and understandable assessment of
the Group’s position and prospects
– Ensuring effective internal control and risk
management systems are in place
– Measuring the Group’s effectiveness
in managing risk and reviewing the risk
identification process
– Approving the remit of the internal audit
function and reviewing its effectiveness
and findings
– Ensuring that an appropriate relationship
is maintained between the Group and
its external Auditors, including the
recommendation to the Board to approve
their appointment and fees
– Monitoring progress of the Group’s
information security strategy to mitigate its
major risks
– Reviewing the scope and effectiveness of the
external audit process
– Reviewing whistleblowing, fraud,
anti-bribery and corruption and data
protection procedures
Committee evaluation
This year, the Board underwent an internal
evaluation of its performance and the activities
of the Committee were reviewed as part of
this process. The results of the evaluation
demonstrated that the Committee continued
to operate effectively and provided sufficient
challenge, and that the composition worked
well with a good balance of experience.
The Committee agreed that it was kept up
to date on financial reporting and related
company law issues on an ongoing and timely
basis and receives sufficient information on
all material and emerging risks faced by the
business. Key recommendations arising include
consideration of time allocated to key meetings
and review of Committee materials to reduce
complexity and highlight key issues to help
provide adequate time and aid robust discussion
at full and half year meetings in particular.
Further details of the evaluation process can be
found in the Governance Report on pages 89
and 90.
RS Group plc Annual Report and Accounts 2025 103STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
SINGLE FIGURE OF REMUNERATION
Directors’ Remuneration report
REMUNERATION
AT A GLANCE
REMUNERATION OUTCOMES IN 2024/25
2024/25 ANNUAL INCENTIVE
Measure (weighting) Actual Threshold Maximum Outcome
Adjusted PBT (30%)
1
£255.7m £255.3m £295.3m 0.3%
Adjusted free cash flow (30%)
1
£220.5m £148.4m £176.4m 30.0%
Like-for-like Group revenue
change (15%)
(1.7)% 0.0% 5.0% 0.0%
CO
2
e reduction
(Scope 1 & 2 emissions) (15%)
7.3% 4.5% 7.0% 15.0%
Individual strategic targets (10%) Simon Pryce/Kate Ringrose 8.5%/7.0%
Total formulaic bonus Simon Pryce/Kate Ringrose 53.8%/52.3%
Total Adjusted bonus (1.3)% Simon Pryce/Kate Ringrose 52.5%/51.0%
1. Both adjusted PBT and adjusted free cash flow exclude restructuring costs.
2022 LTIP AWARD
0%
of maximum
J2G LTIP AWARD
0%
of maximum
Vesting of these awards was determined in accordance with the performance targets, measured
over the three years ended 31 March 2025. J2G LTIP will vest below the Board. See page 123.
£867,148
£581,770
£608,499
£141,128
SHARE OWNERSHIP REQUIREMENT
Target: 400% of base salary
Simon
Pryce
154% OWNED OUTRIGHT
Target: 400% of base salary
Kate
Ringrose
32% OWNED OUTRIGHT
OUR
REMUNERATION
APPROACH
Salary
Pension and
other benefits
Annual
incentive
LTIP
Total
remuneration
Fixed Variable
Salary, pension and
other benefits
Annual incentive
Buyout LTIP
Simon Pryce
£1,475,647
Kate Ringrose
£1,116,873
£393,975
ALIGNMENT WITH WIDER WORKFORCE
3%
UK employees will receive
an average pay increase of
3% effective 1 June 2025
4%
employees globally will
receive an average pay
increase of 4% in 2025
100%
of employees are
eligible to participate
in an incentive plan
SALARY INCENTIVE
RS Group plc Annual Report and Accounts 2025104
2025 DIRECTORS’ REMUNERATION POLICY AND IMPLEMENTATION FOR 2025/26 ROBUST APPROACH TO PAY BENCHMARKING
MARKET DATA (CEO TOTAL TARGET COMPENSATION, FTSE 75-125)
1
FIXED PAY
ANNUAL INCENTIVE
Maximum
opportunity
150%
of base salary
Operation
– 2/3 paid in cash. 1/3
deferred into shares,
which vest after two years.
– Before any incentive pay
out, a threshold level
of adjusted PBT must
be achieved.
Simon Pryce
£845,000
(9.4% increase)
Kate Ringrose
£530,450
(3% increase)
Salary
2025 LTIP
Simon Pryce
Performance shares
250%
of base salary
Restricted shares
100%
of base salary
Kate Ringrose
Performance shares
170%
of base salary
Restricted shares
40%
of base salary
Operation
The hybrid LTIP will be delivered as two-thirds performance shares, subject to the conditions
above and one-third restricted shares. Further detail can be found in the 2025 Directors’
Remuneration Policy on page 114.
Measures
Adjusted PBT 25%
Adjusted free cash flow
25%
Like-for-like Group
revenue change 25%
CO
2
e reduction
(Scope 1 and 2 emissions) 10%
Net promoter score 5%
Individual strategic targets 10%
Measures
Adjusted EPS 50%
TSR 50%
ROCE Underpin
For this Policy review, the
Committee has recalibrated
the benchmark reference
group from the FTSE 50-100
to the FTSE 75-125, reflecting
our ongoing commitment
to a highly robust and
responsible approach to
pay positioning.
The chart below illustrates the CEO’s package for 2025/26
£5m
£4m
£3m
£2m
£1m
£0m
2024 package
2
Proposed package
Illustrates the CEO’s package for 2025/26
As described on page 114, the Committee
intends to revert to the normal award
levels in subsequent years
1. The constituents of the FTSE 75-125 reference group are as follows: Airtel Africa, B & M Retail, Bellway, Berkeley Holdings,
British Land, Burberry, Computacenter, ConvaTec, EasyJet, Endeavour Mining, Entain, Frasers Group, Games Workshop,
Greggs, Harbour Energy, Hikma Pharmaceuticals, Howden Joinery, IMI, Inchcape, International Distribution Services, ITV,
Johnson Matthey, Kingfisher, Land Securities, Londonmetric Property, Ocado, Persimmon, Rightmove, Rotork, Softcat,
Spectris, Taylor Wimpey, Unite Group and Vistry.
2. The 2024 package does not include the J2G LTIP Award.
50
75
100
125
2022 Policy 2025 Policy
FTSE
50-100
FTSE
75-125
RS Group plc Annual Report and Accounts 2025 105STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
It was determined on his appointment in April
2023, that rather than revisit the plan and its
relevance, Simon would be a participant in the
Journey to Greatness LTIP Award (J2G LTIP Award)
and that we would review the Policy and incentive
structures in line with the Policy renewal in 2025.
Simon received a pro-rated award of 483% of
base salary.
The J2G LTIP Award was also measured over the
three years ended 31 March 2025. The threshold
levels of performance for EPS and the KPI
scorecard were not achieved, with the exception
of the on-time-to-promise measure, resulting
in a formulaic outcome of 1%. The Committee
determined that it was appropriate for the awards
to lapse in full for Simon, but to vest awards for all
other eligible employees in line with the formulaic
outcome. This aligns with the view set out later
in this letter that the J2G LTIP Award was not the
appropriate mechanism for the CEO on joining
the Company and that the Committee plans
to address his overall remuneration in the new
Policy. When Kate was recruited in October 2023
it was on a market competitive package and it was
determined that given it was past the mid-point of
the three-year performance period, she would not
participate in the J2G LTIP Award.
2025 Directors’ Remuneration Policy
In line with the normal three-year cycle, we will
be seeking shareholder approval for a new Policy
at our 2025 AGM. In preparation for this, the
Committee has undertaken a comprehensive
review and shareholder consultation programme
to inform our approach and ensure it better
reflects the nature of the markets in which the
Group trades and is more optimally aligned to our
revised strategy and objectives. The outcome from
this review is that we propose the following key
changes to our long-term incentives: removing
the J2G LTIP Award, changing our market
comparison to FTSE 75-125 from FTSE 50-150 and
changing our LTIP into a ‘hybrid’ structure which
combines Performance Shares and Restricted
Shares (weighted two-thirds to performance and
one-third to restricted shares), recognising the
importance of reward structures that align
Key highlights
Membership as at 20 May 2025:
– Joan Wainwright (Chair)
– Alex Baldock
– Louisa Burdett
– Miles Roberts
– David Sleath
Activities during 2024/25
– Overseeing the development of the
proposed 2025 Directors’ Remuneration
Policy (Policy)
– Reviewing and supporting the design and
calibration of the various components of
the Policy, including the hybrid Long Term
Incentive Plan (LTIP) structure
– Extensive engagement with shareholders,
ensuring their views were sought
and considered when finalising the
proposed Policy
– Continued support of the Group’s reward
philosophy to underpin the strategy
and values
– Reviewed and supported the 2024/25
remuneration outcomes with
Group’s performance
– Supported the transition to a restricted share
plan below the Executive Committee (ExCo)
Priorities for 2025/26
– Oversee the implementation of the
new Policy
– Maintain an active and open dialogue with
shareholders and ensure their views are
sought and considered when determining
executive remuneration
– Understand the impact of the forthcoming
EU Pay Transparency legislation for
the Group
– Delivery of an all-employee share
plan enabling more of our people to
become shareholders
Dear shareholder
On behalf of the Remuneration Committee
(the Committee), I am pleased to present the
Directors’ Remuneration report for the year ended
31 March 2025.
2024/25 has been a challenging year for the
Group and the broader industrial market
but despite this the Group has made good
operational progress. A summary of the financial
performance of the Group is set out on pages 28
to 35.
Incentive outcomes for the year
ended 31 March 2025
The 2024/25 annual incentive measures were:
adjusted profit before tax (PBT), like-for-like
revenue growth, adjusted free cash flow, CO
2
e
reduction, and individual strategic measures,
resulting in a formulaic outcome of the financial
measures of 45.3% of maximum. Having reviewed
the formulaic outcome the Committee
determined together with management that it
would be appropriate to reduce the outcome by
1.3% to ensure internal consistency in annual
incentive outcomes across the Group. This results
in an adjusted outcome of 44.0% of maximum.
Including the individual strategic measures
the adjusted bonus outcomes are 52.5% of
maximum for Simon Pryce and 51.0% for Kate
Ringrose. Full details of the plan outcome and the
achievement of their individual strategic measures
are detailed on pages 121 and 122.
Neither Simon nor Kate were awarded a 2022
LTIP Award. For reference, the 2022 LTIP Award
which was based on performance over the
three-years ended 31 March 2025, did not
achieve the threshold level of performance
for both the earnings per share (EPS) and
total shareholder return (TSR) performance
measures. The Committee determined that it
was appropriate for the plan to lapse in full for
all participants.
Joan Wainwright
Chair of Remuneration
Committee
Directors’ Remuneration report continued
REMUNERATION COMMITTEE
REPORT
RS Group plc Annual Report and Accounts 2025106
As part of the 2022 Policy, a one-off J2G LTIP
Award was introduced which the then Executive
Directors, as well as 91 senior managers,
participated in. This was a one-off LTIP award
with a value of 750% of salary for the incumbent
Executive Directors, granted in addition to
the normal 250% of salary annual LTIP (i.e.
representing a total award size, on an annualised
basis, of 500% of salary).
The J2G LTIP Award would only vest on
the achievement of very stretching targets
measured over the one-off performance
period. Having reviewed the operation of this
type of award, the Committee concluded that
the J2G LTIP Award is not effective in a cyclical
trading environment, does not create long-
term alignment with stakeholder interests and
does not act as an effective retention incentive.
Although this was approved by shareholders, we
also acknowledged that a number of shareholders
(and voting agencies) were opposed to the J2G
LTIP Award in 2022. The J2G LTIP Award has
therefore been removed from the Policy.
We remain committed to the key principles
that support a high-performance culture with
maximum levels of equity reward only available for
the delivery of commensurate levels of long-term
out-performance. We recognise the importance
of reward structures that align long-term interests
of shareholders and management through the
cycle and act as effective retention and motivation
incentives for management. The PMI index on the
right, illustrates the cyclical nature of the industrial
cycle, and how the Group is closely aligned to this
market environment.
A range of alternative award structures were
assessed by the Committee. For example, we
considered replacing the LTIP with a ‘single
incentive plan’, but concluded that reward
outcomes that only reflect annual performance
would not be consistent with our objective to
structure the Group appropriately to be more
efficient and scalable to delivering sustained, long-
term outperformance.
Key objectives for remuneration and reward
We need an executive remuneration structure which can align, engage and appropriately reward our
management team for executing the strategy which, we believe, will deliver strong and scalable growth
opportunities over the medium-term. The Committee has taken a very thoughtful and robust approach
to the Policy review, built around the following key principles and objectives:
Commitment to
equity-based incentives
to drive long-term
retention and alignment
We remain committed to creating long-term alignment
with our shareholders by weighting our reward towards
share-based elements and through the use of significant
share ownership requirements.
Incentives which reward
strategic execution
and performance
We re-affirmed our long-standing commitment to a reward structure
which fosters a high-performance culture, with the opportunity
for maximum levels of reward only available for the delivery
of commensurate levels of long-term outperformance for our
shareholders and wider stakeholders. Our incentives link directly to
key performance metrics which align with our strategic delivery.
Competitive in global
talent markets
Our Policy must allow us to successfully compete to secure and retain
the calibre of talent we need in highly competitive global markets,
while also ensuring we take a robust and responsible approach
to quantum.
A structure which works
through the cycle
Critically, our reward structure must address the challenges of
our cyclical trading environment (see below) by ensuring we can
effectively retain, reward and align our people through the industrial
cycle to execute for all our stakeholders.
RS Group trades in line with weighted PMI data
70
65
60
55
50
45
40
35
30
40%
30%
20%
10%
0%
-10%
-20%
-30%
-40%
— Industrial PMI (RS Weighted) – LHS — RS Group LFL revenue growth – RHS
FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 FY2025
long-term value and to motivate and retain our
management team and stakeholders through the
industrial cycle. The quantum of our long-term
incentives will be significantly reduced from the
previous Policy and set at a market competitive
level. No other material changes to the Policy
are proposed. The following sections explain the
background and rationale for this proposal, as
well as the shareholder consultation process we
have followed.
Background – new leadership and a revised,
more focused strategy
Since the last Policy review, we have seen
extensive leadership changes within the Group
and the creation of an ExCo. The new ExCo has
brought greater rigour and understanding to
the Group, its business model and the markets
in which it plays. As a result, and against the
background of a very challenging trading
environment, they have clarified the Group’s
purpose, mission and vision and introduced a
new set of values across the Group. They have
developed a more focused strategy which has
driven better alignment, prioritisation and much
improved execution. The ExCo has enhanced
the business and functional leadership, defined
and started to embed cultural change and
clarified, revised and implemented a clear
operating model with improved accountability.
They are now executing that strategy through
an aligned action plan to accelerate delivery of
sustainable value creation for all stakeholders
as a cyclical business with significant growth
opportunities. Notwithstanding the challenging
geopolitical environment and its impact on the
Group’s markets, they are making good progress,
including continuing to take share across most
of our technical product categories, and are
successfully integrating recent acquisitions to
position us well for when the industry returns
to growth.
Proposed ‘hybrid’ long-term structure
The Committee’s key area of focus during the
review was to ensure that the long-term incentive
structure could meet the objectives on the right.
RS Group plc Annual Report and Accounts 2025 107STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
The Committee also considered switching from
using an LTIP to just using restricted shares (i.e.
awards of long-term shares without performance
conditions). We recognised that restricted shares
would help us to meet a number of the key
objectives outlined on page 107, including our
commitment to long-term equity awards that
can reward and secure executive talent through
the industrial cycle. However, we ultimately
concluded that fully moving away from a
performance-based long-term structure would
not be consistent with key objectives or the
interests of our shareholders.
Therefore, having carefully reflected on the
range of alternatives, we are now proposing
to modify our LTIP into a ‘hybrid’ structure
which will combine Performance Shares and
Restricted Shares. The hybrid structure provides
the opportunity to appropriately reward, retain
and align management through all stages of
the industrial cycle. Given our cyclical exposure,
if we continue to use only Performance Shares,
this risks our ability to retain key talent when the
cycle turns. Switching to using only Restricted
Shares would mitigate this risk but would be
inconsistent with our ongoing commitment to
keeping performance at the heart of our incentive
structure. The Committee therefore believes that
a mixed approach, weighted (two-thirds) towards
the performance element, provides the right
balance to meet our objectives and drive value for
stakeholders through the cycle.
The hybrid LTIP will combine awards of:
– Performance Shares which will operate in the
same way as our current LTIP. Vesting will be
based on stretching long-term targets over
a three year performance period (as described
on page 114 for the 2025 LTIP Award), with
vested shares then subject to a two-year
holding period. Performance Shares are
aimed at motivating and rewarding
long-term outperformance for the benefit
of all our stakeholders.
In developing the parameters of our proposed
hybrid structure, the Committee sought to align
with the key principles of best practice as set out
in UK investor guidance which has been evolving
to reflect these market dynamics. For example,
awards will vest over a three-year period, followed
by a two-year holding period. The hybrid structure
will be heavily weighted towards the performance
element. Restricted Shares will be subject to a
robust underpin and normal award sizes have
been calibrated using a 50% ‘haircut’ to the
equivalent Performance Share award.
The hybrid structure will also be applied to
the ExCo awards in 2025. By introducing the
Restricted Share element for the Executive
Directors and ExCo, this will also improve
alignment to the incentive framework which is
cascaded to the broader management team
where, as reported last year, restricted shares
were introduced during 2024 in direct response
to being a cyclical business that wishes to ensure
employee retention, specifically in the more
difficult periods within an industrial cycle.
Robust approach to quantum
To determine award sizes, as well as overall
remuneration packages for the Executive
Directors, the Committee considered a range of
contextual factors, including the performance,
contribution and circumstances of the individual.
One of the factors we consider is appropriate
market data.
When developing the 2022 Policy, the Committee
had considered data for companies in the lower
half of the FTSE 100 (the ‘FTSE 50-100’) as a
market reference point. For this Policy review,
the Committee has recalibrated this group to
companies ranked between 75th and 125th in
the FTSE by average market capitalisation (the
‘FTSE 75-125’). This change reflected our ongoing
commitment to a highly robust and responsible
approach to pay positioning.
– Restricted Shares which will similarly vest over
an initial three-year period, with vested shares
subject to a two-year holding period. They are
not subject to conventional performance
conditions, but a robust underpin will apply.
Restricted Shares provide a mechanism
to better support long-term retention and
shareholder alignment in an environment of
cyclical exposure.
Our rationale for adopting a hybrid structure
is primarily based on it being a better fit for
our key Policy objectives, our medium term
target achievement and the characteristics
of our business, as described on page 107.
The Committee also noted that hybrid LTIP
models are common market practice in North
America and this model will allow us to be more
competitive in key talent markets outside of
the UK.
The Committee notes that hybrid long-term
structures have traditionally been unusual in the
UK-listed environment, but adoption has been
growing (for example, around 8% of the FTSE 350
now operate a hybrid LTIP, up from less than 2%
two years ago).
We firmly believe that the hybrid structure better
meets our reward objectives on a through-cycle
basis, but we also carefully considered the timing
of the switch to hybrid in the context of where
we are in the cycle. We note that we are not
introducing restricted shares at the high point of
the cycle, illustrating our conviction that it is the
right long-term approach on principle and that we
are not simply seeking to ‘protect’ reward levels
ahead of a potential cyclical downturn.
The Committee determined that, based on our
continued commitment to a framework which
primarily motivates and rewards performance, the
overall hybrid award will be weighted towards the
performance-linked element, with a target mix
of two-thirds Performance Shares and one-third
Restricted Shares. Further detail on our robust
approach to award sizes is set out below.
To determine normal award sizes under the new
Policy, the Committee first considered the target
market positioning against the FTSE 75-125 for
a conventional LTIP award (i.e. excluding any
restricted share component). This indicated
a normal award level of 300% and 250% of
salary for the CEO and CFO roles, respectively.
Importantly, this would re-introduce a higher
award level for the CEO role in line with typical
market practice and our historic approach (prior
to 2020).
These market-based award levels represent a
significant reduction in opportunity from our
previous Policy, under which the combined award
level for the LTIP and the J2G LTIP Awards (on
an annualised basis) was 500% of salary for all
Executive Director roles.
The next step was to calibrate the specific
award levels for the Performance Share and
Restricted Share components. The Committee’s
approach here was to establish the desired
weighting between the two elements (two-thirds
weighted to performance) and ensure that the
Restricted Share award (one-third of award
value) was calculated using a 50% ‘haircut’ to the
equivalent Performance Share award in line with
investor guidance.
Following this process, the Committee determined
that the normal annual award levels under the
Policy will be as follows:
– CEO: Performance Shares of 200% of salary
and Restricted Shares of 50% of salary (which
is equivalent to a conventional LTIP award of
300% of salary using a 50% haircut) for the
Restricted Share element
– CFO: Performance Shares of 170% of salary
and Restricted Shares of 40% of salary (which
is equivalent to a conventional LTIP award of
250% of salary using a 50% haircut) for the
Restricted Share element
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025108
To ensure sufficient flexibility over the course
of the Policy period to allow us to attract and
retain the best executive talent, the maximum
award which may be granted under the Policy in
respect of any financial year will be 250% of salary
for Performance Shares and 100% of salary for
Restricted Shares. Information on the Committee’s
proposed approach for implementation in 2025 is
set out below.
No other material changes to Policy
In respect of other aspects of our Policy
framework, no material changes are proposed.
The maximum Annual Incentive award will remain
at 150% of salary, with one-third deferred into
shares for two years. The Committee noted an
emerging market trend in the UK to link the
requirement for bonus deferral to the level of an
executive’s shareholding. However, we recognise
the importance of long-term share ownership to
the reward philosophy and objectives described
above and are therefore not proposing any
changes to our deferral provisions at this time.
Shareholder alignment is also supported by
market leading shareholding requirements of
400% of salary for the CEO and 250% for the
CFO, both set in excess of the upper quartile of
the market and remaining in force for two years
post-cessation. The CFO’s requirement has been
reduced from 400% to reflect the reduction
in award size (from the J2G LTIP Award in the
previous Policy) and the relativity of LTIP award
levels with respect to the CEO, but nevertheless
remains in excess of the market upper quartile.
Implementation in 2025
Consistent with previous years and the principles
we apply when reviewing base salary through
the organisation, a number of factors, including
performance, market position and relativity to
the wider workforce, were considered by the
Committee for the Executive Directors. This year,
the average expected increase for the wider
UK workforce is 3% and given Kate’s market
competitive package, the Committee agreed to
align her percentage increase to this level.
For Simon, the Committee was aware on his
appointment that his salary was materially below
the median of the then reference group of the
FTSE 50-100, and indeed below the proposed
reference group of FTSE 75-125. However, the
Committee determined that it was appropriate to
defer a full review of his package until the Policy
review. In this context and against a background
of the wider policy changes, to reflect Simon’s
strong performance and leadership during his
tenure so far, after careful consideration the
Committee determined that it was necessary to
adjust his salary level to £845,000, representing a
9.4% increase.
We recognise that the percentage increase will
be above the UK workforce average, but note
that it is consistent with the principles we apply
for other top performers in the workforce,
whose base salary are also identified as below
market to ensure we retain our high performers.
The Committee also expects that any subsequent
salary increases for Simon during the next Policy
period will be no higher than the wider workforce.
The Annual Incentive for 2025/26 will continue
to be based on key financial and strategic
targets for the year. The Committee reviewed the
performance measures and agreed two changes
to improve alignment with strategy and our
objectives for the year ahead.
– Our three financial metrics (like-for-like revenue
growth, adjusted PBT and adjusted free cash
flow) will be weighted equally at 25% of the
total, creating a better balance between these
three key objectives.
– We will be re-introducing Net Promoter Score
into the Annual Incentive (with a 5% weighting)
to ensure that the customer experience, a
key objective of our strategy (see page 21),
is captured. The remainder will continue to
be based on CO
2
e reduction and strategic
individual targets.
Award levels in previous policy
(LTIP + Annualised J2G)
New policy – awards levels
on conventional LTIP basis
New policy – converted to
hybrid using 50% haircut for RSU
0%
100%
200%
300%
400%
500%
500%
300%
200%
50%
LTIP is converted
to Restricted Shares
using a 50% ‘haircut’
Signiﬁcant reduction
in award size from
previous policy
Align to FTSE 75-125 market range
50% haircut
}
Award levels in previous policy
(LTIP + Annualised J2G)
New policy – awards levels
on conventional LTIP basis
0%
100%
200%
300%
400%
500%
500%
250%
170%
40%
LTIP is converted
to Restricted Shares
using a 50% ‘haircut’
Signiﬁcant reduction
in award size from
previous policy
Align to FTSE 75-125 market range
50% haircut
}
New policy – converted to
hybrid using 50% haircut for RSU
Illustration of calibration of normal award sizes (CEO)
Illustration of calibration of normal award sizes (CFO)
Target market positioning
(FTSE 75-125)
LTIP
Expected
value
CEO 300% 150%
CFO 250% 125%
50%
50%
Normal award sizes
Align to market with calibration heavily weighted to performance
Performance
shares
Expected
value
Restricted
shares
Total
expected value
200% 100% 50% 150%
170% 85% 40% 125%
50%
50%
RS Group plc Annual Report and Accounts 2025 109STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
The chart on page 105 sets out the positioning
of Simon’s total target compensation against the
FTSE 75-125 group, for both 2025/26 and once
LTIP awards revert to the normal level. The chart
illustrates the impact of the steps we have taken
to reasonably and responsibly address the
previous market shortfall.
Shareholder engagement
We have a well-established commitment to
engaging with our shareholders on executive
pay. This year, in respect of the development
of the new Policy and how we will implement
it for 2025, we undertook an extensive
multi-phased consultation process. The first
phase of this engagement involved meeting
with a handful of our very largest shareholders,
comprising just over 36% of the share register,
to test the initial thinking on key elements of
the proposed framework.
Building on the feedback received from this first
phase, we then broadened our engagement to
the remainder of our top 30 shareholders, and
as a result, consulted with c. 86% of the register
in total, broadening the coverage from previous
Policy consultations. As part of the second
phase we undertook 14 shareholder meetings
and received feedback from another four
shareholders. We also engaged with the major
shareholder representative bodies.
Overall, shareholders were supportive of our
approach. There was a clear understanding of
the challenges we face on remuneration and
acknowledgment of how we were seeking to
address these in a robust and responsible way.
Shareholders were supportive of the removal
of the J2G LTIP Award and the transition of
our LTIP towards the hybrid structure, with
many welcoming the continued commitment
to performance from the weighting of the two
elements. A number of shareholders appreciated
the Committee’s recalibration of the market
reference point from FTSE 50-100 to FTSE 75-125
and were generally supportive of proposed salary
increases and incentive opportunities.
Feedback we received informed the Committee’s
approach in a number of areas:
– Our initial proposal sought to remove the
PBT ‘underpin’ from the Annual Incentive
framework on the basis that the stretch in the
target ranges provided sufficient safeguard
for shareholders. However, we now propose
to retain the underpin in the Policy, which is
indicative of our approach to ensuring pay
outcomes reflect performance, an area in which
we have a strong track record.
– We took on board the range of shareholder
feedback we received on a number of aspects
of the calibration of the hybrid performance
framework. For example, there was a range of
views on the approach and types of factors to
consider for the Restricted Shares underpin.
On the proposed change to the TSR group
for the Performance Shares, again we tested
different approaches and heard a range of
views with many shareholders understanding of
the challenges we face in constructing a robust
sector peer group and therefore supportive of
the switch to measuring against the FTSE 350.
– Some shareholders wanted to better
understand our approach to the ‘haircut’, which
we have provided on page 109 which illustrates
the process we followed in materially reducing
award sizes from the previous Policy, and then
calibrating the Restricted Share element using
a 50% haircut.
The Committee acknowledges that it did receive a
diverse range of views and inputs and can confirm
that all feedback was taken into account in
finalising proposals. The Policy, and how we intend
to implement it for the year ahead, represent a
balanced outcome from its consultation process
and are right for the business at this stage of
its development.
On behalf of the Committee, I would like to thank
all those shareholders for their engagement
during this process. We will continue to engage
openly with our shareholders on executive
remuneration moving forward.
As usual, we will set stretching performance
targets for all performance measures which will
be disclosed retrospectively in next year’s report.
Executive Directors will be eligible for a maximum
award of 150% of salary and one-third of any
earned amount will be deferred into shares for
two-years, both unchanged under the new Policy.
Before any incentive pay out, a threshold level of
adjusted PBT will need to be achieved.
In 2025, subject to shareholder approval, we
will operate the ‘hybrid’ LTIP structure discussed
above for the first time. The Performance Shares
will be based on an equal mix of adjusted EPS
and TSR performance, supported by the ROCE
underpin as usual. Taking account of internal
forecasts over the performance period, the
challenging market conditions in which the Group
operates, our long-term growth ambitions and
the expectations of the investment community,
the adjusted EPS targets are considered to be
appropriately stretching. For the TSR element,
performance will be measured against the
constituents of the FTSE 350 index, of which
the Group is a constituent, excluding financial
services and energy companies. We believe this
simple, objective and market-aligned approach
is more robust than a bespoke group given the
Group’s limited number of directly comparable
listed peers.
The Restricted Share award will be subject to a
robust underpin. Full details of the performance
targets and underpins are set out on page 114.
The Committee carefully considered the award
sizes for the first awards under the new Policy.
Kate will receive awards at the normal level as
described above (i.e. Performance Shares of
170% and Restricted Shares of 40% of salary).
In determining Simon’s award size for 2025, a
number of factors were taken into account by the
Committee, all related to ensuring that the CEO
is fairly rewarded for his work to date and that
he is appropriately incentivised and engaged to
continue his strong leadership for the next phase
of our strategic delivery.
First, it is important to recognise the strong
contribution that Simon’s leadership has delivered
during his tenure as CEO, which, as flagged in last
year’s remuneration report, the Committee does
not believe has been sufficiently captured in his
remuneration outcomes to date (for example –
the lapsing of the J2G LTIP Award, other ‘in-flight’
LTIP awards being largely ‘underwater’, and the
forfeiture of the 2023/24 Annual Incentive as a
result of a sustained period of challenging market
conditions which triggered the profit ‘underpin’
for the year). Combined with the relatively low
positioning of salary, and the Committee’s
decision on the CEO’s appointment to defer
reviewing the 2022 Policy and its relevance,
this has created a market shortfall in total
compensation received compared to the strategic
progress achieved (as highlighted on page 107)
over the last two years. Looking forward, it is also
critical to ensure that management are retained
and motivated to accelerate value creative
growth and the continued effective execution of
our strategy. In this competitive global market
for experienced and high calibre leadership
talent, a key aspect of this is to ensure there
are reasonable but effective long-term equity
awards to drive retention and alignment. Simon’s
shareholding of 154% of salary is as a result of his
personal investment in the Group.
Having reflected on these factors and after
consultation with shareholders, the Committee
concluded that granting awards at the maximum
levels allowable under the Policy for 2025 would
be the most effective way to mitigate these risks
and achieve our objectives. We therefore intend,
on this occasion, to utilise the flexibility under
the new Policy to grant Simon’s 2025 awards as
a Performance Share award of 250% of salary
and a Restricted Share award of 100% of salary.
The Committee’s intention would be that, having
now normalised the packages of both Executive
Directors, awards in subsequent years would
revert to the normal award levels described on
page 114.
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025110
KEY ACTIVITIES
DURING THE YEAR
Consideration of the wider
workforce experience
During the year, we have refreshed our reward
philosophy to support the delivery of the business
strategy and values. The philosophy is designed to
deliver transparent, inclusive rewards, which are
market competitive to attract and retain talent and
to incentivise high performance, while continuing
to support the wellbeing of our people.
As we began to embed the new reward
philosophy, we reviewed the design of the Group
Annual Incentive and approach to LTIP below
the ExCo. For the first time, we introduced a
personal performance measure to the Annual
Incentive for our management level employees,
providing participants with the opportunity to
have a proportion of their reward aligned with
their personal performance and their contribution
to the success of the business. Additionally, as
set out in last year’s report, we have transitioned
our senior management (below ExCo), from the
LTIP to a restricted share plan to drive alignment
with our stakeholders and our reward philosophy.
The changes to the incentives have been
positively received by the participants. The move
to a hybrid model for our most senior roles will
improve the alignment with this approach.
Enabling our people to become shareholders
and to have a personal stake in the business
remains important to us and in 2025 we will be
awarding all our eligible employees with a one-off
award of restricted shares. We will continue to
consider ways to help our people share in our
overall success alongside our other stakeholders,
in addition to our existing share purchase and
incentive plans.
MAY
– Approved the 2023/24 Annual
Incentive and 2021 LTIP
Award outcomes
– Approved the final design of the
2024/25 Annual Incentive and 2024
equity plans design for ExCo and
senior management
– Approved the 2024/25 Annual
Incentive and 2024 LTIP performance
measures and targets
– Set objectives for the coming year for
the CEO
– Approved CEO, CFO, ExCo and senior
management 2024 share awards
– Approved the 2024 Directors’
Remuneration report to be put to
shareholders at the July 2024 AGM
– Reviewed approach to the wider
workforce remuneration for the year
OCT
– Reviewed and input to the initial draft
of the Policy proposal
NOV
– Reviewed and approved the Policy
shareholder consultation materials
DEC
– Considered initial shareholder feedback
on the proposed Policy
– Approved share awards to eligible people
who joined the Company in the period
June to December 2024
– Approved fees for the Chairman
– Reviewed the Remuneration Advisor
performance and fees for the year
JAN
– Considered shareholder feedback on the
proposed Policy
– Received an update on the launch
and implementation of the new
reward philosophy
– Reviewed the current status of share
ownership of Executive Directors
and ExCo
– Received a market update from the
Remuneration Advisor
MAR
– Considered shareholder feedback on the
proposed Policy
– Reviewed the initial view of the 2024/25
outcomes for the Annual Incentive, 2022
LTIP and J2G LTIP Awards against the
performance targets
– Approved, in principle, the design of
the 2025/26 Annual Incentive and 2025
equity plans
– Reviewed the 2024 Gender Pay
Gap Report
– Reviewed the Terms of Reference for the
Committee and the All Employee Share
Plan Committee
– Reviewed the Committee annual
evaluation outcome
I am proud of the work the Committee has done
during the year and want to thank the Committee
members for their contribution. I also would like
to again thank our shareholders for the time
taken to engage with us during the year and
their continued support at the last AGM. I hope
that you will join the Board in supporting the
resolutions to approve the 2024/25 Directors’
Remuneration report and the Policy to be put to
shareholders at the 2025 AGM.
Joan Wainwright
Chair of Remuneration Committee
20 May 2025
RS Group plc Annual Report and Accounts 2025 111STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
2025 Directors’ Remuneration Policy
The 2025 Directors’ Remuneration Policy (Policy) set out below is proposed for shareholder approval at the AGM to be held on 17 July 2025. Subject to shareholder approval, the Policy will take effect from that date.
The key differences between the Policy and the Directors’ Remuneration Policy approved at the Company’s AGM held on 14 July 2022 are:
– Removal of the J2G LTIP Award and consequent significant reduction in overall package opportunity
– Modification of our LTIP into a ‘hybrid’ structure which will combine Performance Shares and Restricted Shares
– Introduction of a higher LTIP quantum level for the CEO role (relative to the CFO) in line with typical market practice and our historic approach
– Reduction of CFO shareholding guideline from 400% to 250%
Further background to these changes can be found in the Committee Chair’s Letter on pages 106 to 111.
Executive Director 2025 Remuneration Policy table
Component: Base salary
Element Details
Objective
To provide a market-competitive level of fixed pay reflecting the scale and complexity of our business enabling us to attract and retain global talent.
Operation
Generally reviewed each year, with increases normally effective from 1 June. Salaries are set by the Committee to reflect factors which include the scale and complexity of the
Group, the scope and responsibilities of the role, the skills, experience and performance level of the individual, the overall total compensation opportunity, and the Committee’s
assessment of the competitive environment including consideration of appropriate market data for companies of broadly similar size, sector and international scope to RS
Group plc.
Opportunity
There is no prescribed maximum salary.
Base salary increases are applied in line with the outcome of the annual review. Factors that are considered include: increases for other employees, changes in role and
responsibilities, market levels, and individual and Company performance. Salary increases will normally be based on the same framework which applies across the UK
employee population.
Performance measures
Not applicable.
Component: Pension
Element Details
Objective
To provide a level of retirement benefit that is competitive in the relevant market and aligned to the approach for the employee population.
Operation
Executive Directors may participate in the defined contribution section of the group pension scheme (Scheme) or receive a cash supplement in lieu.
Opportunity
A maximum contribution or cash supplement from the Company for any Executive Directors will be in line with the maximum rate taken by the majority of the wider UK workforce
(currently 10.5% of salary).
Performance measures
Not applicable.
SUMMARY OF THE
2025 DIRECTORS’ REMUNERATION POLICY
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025112
Component: Benefits
Element Details
Objective
To provide benefits in line with the relevant market.
Operation
Executive Directors are provided with a company car (or a cash allowance in lieu thereof) and medical insurance. Other benefits may be provided or introduced from time to time
to ensure the benefits package is appropriately competitive and reflects the circumstances of the individual Executive Director.
Opportunity
While there is no prescribed maximum, Executive Directors do not normally receive total taxable benefits exceeding 10% of base salary and it is not currently anticipated that the
cost of benefits provided will exceed this level in the years over which this Policy will apply. The Committee retains the discretion to approve a higher cost where appropriate (for
example, relocation expenses or expatriation allowance) or in circumstances where factors outside the Company’s control have changed materially (for example, market increases
in insurance costs).
Performance measures
Not applicable.
Component: Annual Incentive
Element Details
Objective
To focus Executive Directors on achieving demanding annual targets relating to Group performance. The deferral element ensures focus on our longer-term business goals.
Operation
Performance targets are normally set at the start of the financial year taking into account the annual targets and objectives agreed by the Board. After the end of the financial year,
the Committee determines the extent to which these targets have been achieved.
A proportion of the total annual incentive payment (currently one-third) is delivered in the form of deferred shares in the Company under the Deferred Share Bonus Plan (DSBP).
These shares normally vest after a period of two years, subject to continued employment. Dividend equivalents may be payable on shares which vest and may be delivered in the
form of shares. The remainder is paid in cash after the year end.
Malus and clawback provisions apply to all elements of the Annual Incentive (see notes to this table).
The Committee will operate the DSBP in accordance with the rules of the plan.
Opportunity
The maximum opportunity in respect of a financial year is 150% of base salary.
Performance measures
Payment is determined by reference to performance, assessed over one financial year based on financial and strategic performance measures which the Committee considers to
be aligned to the strategy and the creation of shareholder value.
The performance measures and weighting for Awards to be granted in 2025/26 are summarised below. Further detail is provided on page 119.
– Like-for-like revenue growth – 25%
– ESG carbon-reduction metric – 10%
– Adjusted free cash flow – 25%
– Net promoter score (NPS) – 5%
– Adjusted profit before tax (PBT) – 25%
– Individual strategic targets – 10%
The performance measures and weightings are normally agreed by the Committee at the start of each year, according to annual business priorities. The overall framework will
normally be weighted towards financial measures of performance. The Committee retains discretion to use different or additional measures and weightings to ensure that the
annual incentive framework appropriately supports the business strategy and objectives for the relevant year.
The Committee has discretion to adjust the formulaic annual incentive outcomes to ensure alignment of pay with performance and fairness to shareholders and participants.
The Committee also has the discretion to adjust targets for any exceptional events that may occur during the year. Any such discretion will be within the limits of the plan and will
be fully disclosed in the relevant Annual Report on Remuneration.
Before any incentive may pay out, a threshold level of adjusted PBT must be achieved. For threshold performance, the annual incentive payout will not normally exceed 10% of the
maximum opportunity. For target performance, the annual incentive payout will be no higher than 50% of the maximum opportunity.
RS Group plc Annual Report and Accounts 2025 113STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Component: Long-term incentive
Element Details
Objective
To link the largest part of the Executive Director’s annual package with long-term business performance, while ensuring the Group can reward on a through-cycle basis, and attract
and retain Executives globally. Performance metrics are aligned with shareholders’ interests and the holding period ensures a focus on sustainable long-term performance.
Operation
Awards of shares may be made annually under the Company’s LTIP, in the form of conditional shares or nil-cost options. Dividend equivalents may be payable on any shares
vesting and may be delivered in the form of shares. Under the hybrid structure, awards of both Performance Shares and Restricted Shares will be made. These awards will vest
over a period of three years subject to continued employment and the satisfaction of the performance measures (for the Performance Shares) and the discretionary underpin
(for the Restricted Shares), as described below. There will be a further holding period of two years following vesting. Malus and clawback provisions apply (see notes to this table).
The Committee will operate the LTIP in accordance with the rules of the plans.
Opportunity
The maximum LTIP award in respect of a financial year will comprise of:
– A maximum Performance Share award of 250% of salary; and
– A maximum Restricted Share award of 100% of salary
Awards will normally be granted below these maximum levels. Award sizes to be granted during 2025 are set out on page 110.
Performance measures
Vesting of the Performance Shares will be determined by reference to performance assessed over a period of at least three years, based on performance measures which the
Committee considers to be aligned with the delivery of strategy and long-term shareholder value. The performance measures are determined annually and will normally include
metrics linked to profitability, shareholder value and capital efficiency.
The performance measures for Performance Shares Awards to be granted in 2025/26 are as follows:
– Adjusted earnings per share (EPS) – 50%
– Comparative total shareholder return (TSR) – 50%
– A return on capital employed (ROCE) underpin
The level of vesting for threshold performance of the Performance Shares will be no higher than 25% of maximum. Additionally, for the Award to vest, the Committee must be
satisfied that there has been a sustained improvement in the Company’s underlying financial performance. The Committee has discretion to adjust the formulaic outcomes if it
does not reflect appropriately underlying performance over the period or is not appropriate in the context of circumstances that were unexpected or unforeseen when awards
were made. The Committee also has discretion to adjust targets if it considers that an amended target is reasonable, appropriate and would not be materially more or less difficult
to satisfy than when it was originally set.
Whilst the Restricted Share awards provide greater certainty of reward by their very nature, the Remuneration Committee will ensure any value delivered to Executive Directors
is fair and appropriate in the context of the business performance and experience of our shareholders. As a result, they are subject to a discretionary underpin that guides the
Remuneration Committee when determining whether any discretion needs to be applied to reduce, including to zero, the final vesting of awards. The underpin is based on a
holistic review of overall business performance delivered over the vesting period, as determined by the Committee. In assessing the underpin, the Committee will consider the
Group’s overall performance by reference to a range of factors including, but not limited to, underlying financial health in the context of the Board’s expectations and the market
environment, strategic execution, and progress towards our sustainability commitments.
Component: All employee share plans
Element Details
Objective
To encourage the ownership of RS Group plc shares.
Operation
Executive Directors will be eligible to participate in all employee share plans on the same basis as other employees.
Opportunity
Maximum opportunity will be in line with other employees and HMRC approved limits, where appropriate.
Performance measures
Not applicable.
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025114
Component: Share ownership requirement
Element Details
Objective
To align Executive Director and shareholder interests and reinforce long-term decision making.
Operation
Executive Directors are expected to build up and retain a personal holding in RS Group plc shares:
CEO – holding of 400% of base salary
CFO – holding of 250% of base salary
To support this objective, Executive Directors are expected to retain at least 50% of any share awards that vest (net of tax) until this guideline is met. Unvested DSBP awards and
vested LTIP awards in a holding period will count towards this guideline (on a net-of-tax basis).
Opportunity
Not applicable.
Performance measures
Not applicable.
Component: Post-employment share ownership requirement
Element Details
Objective
To create long-term alignment between Executive Director and shareholder interests by ensuring a shareholding is retained in the period after an Executive Director has left
the Group.
Operation
Executive Directors are required to retain a personal holding in RS Group plc shares for a period of two years after leaving the Board. The level of required shareholding is equal to
that of the in-employment guideline (for the CEO this is 400% of salary and for the CFO this is 250% of salary) or, if lower, the actual shareholding at the date of leaving the Board.
The actual shareholding at cessation includes only shares which have vested (or are in a deferral or holding period, on a net-of-tax basis).
Opportunity
Not applicable.
Performance measures
Not applicable.
Notes to the Policy table
The Committee reserves the right to make any remuneration payments and/or payments for loss
of office (including exercising any discretions available to it in connection with such payments),
notwithstanding that they are not in line with the Policy, where the terms of the payment were agreed:
i. before the Policy came into effect, provided that the terms of the payment were consistent with the
Directors’ Remuneration Policy (approved by shareholders in accordance with the Companies Act) in
force at the time they were agreed; or
ii. at a time when the relevant individual was not a Director of the Company and, in the opinion of
the Committee, the payment was not in consideration for the individual becoming a Director of
the Company.
For these purposes, payments include the Committee satisfying awards of variable remuneration and, in
relation to an award over shares, the terms of the payment are agreed at the time the award is granted.
The Committee may make minor amendments to the Policy (for regulatory, exchange control, tax or
administrative purposes, or to take account of a change in legislation) without obtaining shareholder
approval for that amendment.
Malus and clawback provisions
All elements of the incentive framework (annual incentive, including the DSBP element and LTIP awards)
are subject to malus and clawback provisions, which the Committee may invoke in circumstances
which include:
– misconduct or material error of the participant or their team
– material misstatement of the Company’s financial statements (being the Group accounts and the
Company accounts)
– an error in assessing a performance condition or in the data on which the award was granted, vested
or released
– serious reputational damage
– material corporate failure
In such circumstances, the Committee has discretion to:
– Require a participant to return a cash incentive at any time up to the second anniversary of payment
– Reduce (including down to zero) a DSBP award prior to vesting
– Reduce (including down to zero) a LTIP Award prior to vesting and/or require, at any time prior to the
end of the holding period (five years from grant), a participant to return part or all of the value of the
award received
RS Group plc Annual Report and Accounts 2025 115STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Performance measure selection and approach to target setting
The annual incentive performance measures are selected each year to reflect the financial and strategic
performance measures which the Committee considers to be aligned with the delivery of the strategic
priorities and which directly reinforce the medium-term performance framework. The performance
measures for the Performance Shares were selected to provide a balance between external and internal
measures of performance, reflect the Group’s long-term strategic key performance indicators, as well
as measure absolute and relative performance. TSR aligns performance with shareholders’ interests.
Adjusted EPS is a measure of the growth and profitability of the Company that also reflects management
performance, and is a measure used by investors in deciding whether to invest in the Company.
The ROCE underpin reflects the efficiency of profit generation and balance sheet management.
Targets applying to the annual incentive and Performance Shares are set annually, based on a
number of internal and external reference points. Annual incentive targets are set by reference to the
annual targets agreed by the Board. Performance Shares targets reflect prevailing industry context,
expectations of what will constitute appropriately challenging performance levels and factors specific
to the Company. The upper end of the Performance Shares target range requires a challenging level of
performance to be delivered.
Differences from remuneration policy for the wider workforce
The reward philosophy for our wider workforce is based on broadly consistent principles as described on
page 111.
Annual salary reviews across the Group take into account individual and business performance, local pay
and market conditions and salary levels for similar roles in comparable companies.
All Executive Directors and our wider workforce have the opportunity to participate in an incentive.
In line with typical market practice, opportunities and performance measures vary by organisational
level, geographical region and an individual’s role. Other members of the senior management team are
eligible to participate in the DSBP and the LTIP on similar terms. Differences apply where appropriate
(e.g. in the grant levels awarded). Below the senior management team level, managers may be invited to
participate in the hybrid LTIP or receive grants of restricted shares only. Many of our people are eligible
to participate in the Company’s all employee share plans and we continue to explore opportunities to
extend the opportunity to more of the workforce.
Performance scenario charts
The charts on the right provide estimates of the potential future reward opportunity for the Executive
Directors, based on remuneration package for the first year of the Policy period in 2025/26 (as set out
on page 110) and the potential mix between the different elements of remuneration under four different
illustrative performance scenarios: minimum, target, maximum and maximum (including 50% share
price growth).
The minimum scenario reflects fixed remuneration of base salary, pension, and taxable benefits (taxable
benefits based on the amount received in 2024/25).
The target scenario reflects fixed remuneration as above, plus target annual incentive payout (50% of
maximum), threshold vesting of the Performance Shares 25% of the maximum and full vesting of the
Restricted Shares.
The maximum scenario reflects fixed remuneration, plus full payout under all incentives.
The maximum (including 50% share price growth) scenario reflects fixed remuneration, plus full payout
under all incentives (as described above), plus 50% share price growth on the LTIP awards as prescribed
by the disclosure regulations.
100% 32% 18% 14%
21%
24% 19%
46%
57% 44%
22%
£0k
£1,000k
£2,000k
£3,000k
£4,000k
£5,000k
£6,000k
£7,000k
Minimum Target Maximum
Maximum
(including
50% share
price growth)
Chief Executive Oﬃcer (CEO)
Fixed Annual bonus LTIP Share price growth
£951k
£2,958k
£5,176k
£6,655k
100% 42% 24% 20%
28%
32% 26%
30%
44% 36%
18%
£0k
£500k
£1,000k
£1,500k
£2,000k
£2,500k
£3,000k
£3,500k
Minimum Target Maximum
Maximum
(including
50% share
price growth)
Chief Financial Oﬃcer (CFO)
£601k
£1,436k
£2,509k
£3,066k
Approach to Executive Director recruitment remuneration
External appointment
In cases of hiring or appointing a new Executive Director from outside the Group, the Committee may
make use of all components of remuneration set out in the Policy table on pages 112 to 115, subject
to the limits contained in that table. In determining the appropriate remuneration structure and
level for the appointee, the Committee will take into consideration all relevant factors to ensure that
arrangements are in the best interests of shareholders.
The Committee may also need to make an award of shares or a cash payment in respect of a new
appointment to buy-out remuneration arrangements or income forfeited as a result of leaving a previous
employer, over and above the approach and award limits outlined in the Policy table. In determining an
appropriate structure for any buy-out awards, the Committee will consider all relevant factors including
the form and time horizon of the forfeited remuneration, any performance conditions attached to the
awards being bought out, and the likelihood of those conditions being met. Any such buyout will have a
fair value which, in the view of the Committee, is no greater than the fair value of the awards forfeited.
Internal appointment to the Board
In cases of appointing a new Executive Director by way of internal promotion, the Policy will be applied
consistently to that for external appointees detailed above. Where an individual has contractual
commitments made prior to their promotion to Executive Director level, the Committee may choose to
continue to honour these arrangements.
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025116
Service contracts and policy for payment for loss of office
Both Executive Directors have service agreements that operate on a rolling 12-month basis. The service
agreements provide for 12 months’ notice by the Company and by the Executive Directors.
The Committee’s policy for Directors’ termination payments is to provide only what would normally be
due to Directors had they remained in employment in respect of the relevant notice period and not to go
beyond their normal contractual entitlements.
Both Executive Directors’ service agreements provide for base salary in lieu of notice. The Committee
will monitor, and where appropriate, enforce the Directors’ duty to mitigate loss. Termination payments
will also take into account any statutory entitlement at the appropriate level, to be considered by the
Committee on a case-by-case basis.
When the Committee believes that it is essential to protect the Company’s interests, additional
arrangements may be entered into (for example, post-termination protections above and beyond those
in the contract of employment) on appropriate terms. The Committee may also agree to pay legal fees
and outplacement costs or other such costs on behalf of the Directors.
Any incentive arrangements will be dealt with subject to the relevant rules, with any discretion exercised
by the Committee on a case-by-case basis taking into account the circumstances of the termination.
The table below summarises how awards under the various incentive arrangements are typically treated
in specific circumstances.
Good leaver
1
Bad leaver
1
Change of control
Annual incentive
Annual incentives are paid only to the extent that the performance targets are met. Any such
annual incentive payout would normally be on a pro-rata basis, taking account of the period
actually worked. Payment would normally be made after the end of the financial year. Any annual
incentive payout will be paid without the DSBP element.
No annual incentive
payout is usually made.
Annual incentive may be paid, taking into
account performance and on a pro-rata basis.
DSBP
Awards normally vest in full at the normal vesting date, unless the Committee, in its discretion,
decides that awards should be time pro-rated and/or should vest on the date of cessation
of employment.
Unvested awards
usually lapse.
Awards vest in full on the change of control,
unless the Committee, in its discretion, decides
that awards should be pro-rated for time
2
.
LTIP
Unvested awards will normally continue and vest at the normal vesting date, based on the
extent to which any performance conditions or underpins have been achieved. The award will be
reduced pro-rata to take account of the proportion of the vesting period that had elapsed (unless
the Committee determines otherwise). The Committee has discretion to determine that awards
should vest earlier than the normal vesting date, in which case the Committee may determine the
extent to which any performance conditions or underpins have been achieved in such manner
as it considers reasonable. The award will remain subject to a pro-rata adjustment. If, following
cessation as a good leaver, the individual agrees to start employment with another employer
before the vesting date, the Committee may determine that the award will lapse. Vested awards
remain subject to the holding period
3
.
Unvested awards
normally lapse.
Vested awards
remain subject to the
holding period
3
.
Awards would vest on the change of control
to the extent determined by the Committee,
taking into account the extent to which the
performance conditions have been satisfied
and the proportion of the vesting period that
has elapsed (unless the Committee determines
otherwise)
2
.
All employee plans
In line with the same treatment for all employees under the plan rules and HMRC rules, where applicable.
1. Good leaver provisions would apply in circumstances such as death, ill-health, injury or disability, the employing company ceasing to be a member of the Group or the transfer of an undertaking to a non-group member, or any other reason that the Committee determines in its
discretion. Bad leaver provisions apply under all other circumstances.
2. Alternatively, on a change of control, unvested share awards may be exchanged for equivalent awards of shares in a different company. In the event of a variation in capital, demerger, distribution, delisting, special dividend or other event which, in the Committee’s opinion, would
materially affect the current or future value of the Company’s shares, the Committee may allow awards to vest and be released early on the same basis as for a change of control. Alternatively, in these circumstances or in the event of a variation of the Company’s share capital, the
Committee may adjust the number of shares subject to an award.
3. In such circumstances, the vested awards will normally be released on the original release date, unless the Committee determines it should be released following cessation of employment. However, if a participant is summarily dismissed, awards will immediately lapse.
RS Group plc Annual Report and Accounts 2025 117STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Consideration of employment conditions elsewhere in the Group
The Group seeks to promote and maintain good relations with employee representative bodies –
including trades unions and works councils – as part of its broader employee engagement strategy and
consults on matters affecting employees and business performance as required in each case by law
and regulation in the jurisdictions in which the Group operates. The Committee is mindful of the pay
increases, incentive outcomes and share award participation in relevant markets across the rest of the
Group when considering the remuneration of the Executive Directors. Employees have the opportunity
to discuss various topics including the Policy and framework via various internal forums.
Consideration of shareholder views
The Committee consulted widely with key investors and shareholder bodies and took the feedback
it received into account in developing the Policy. This consultation exercise covered our top 30
shareholders representing c. 86% of the share register (and is described in further detail on page 110).
It remains the Committee’s intention that key shareholders will normally be consulted before making any
significant changes to the application of the Policy.
More broadly, the Committee considers shareholder views received during the year and at the
AGM each year and is regularly kept abreast of evolving guidance from shareholders and investor
bodies. The Chair of the Committee is always available to shareholders, should they wish to discuss
remuneration arrangements.
Chairman and Non-Executive Director Remuneration Policy
Non-Executive Directors do not have service agreements, but instead have letters of appointment
providing for an initial three-year term. The Chairman’s letter of appointment and the Non-Executive
Directors’ letters have a three-month notice period. All Directors are subject to re-election annually at
the AGM. Neither the Chairman nor the Non-Executive Directors are eligible to participate in any of the
Company’s annual incentive, long-term incentive or pension plans. Details of the policy on fees paid to
the Company’s Non-Executive Directors are set out in the table below.
Component: Chairman and Non-Executive Director Fees
Element Details
Objective
To attract and retain Non-Executive Directors of the highest calibre with broad commercial experience relevant to the Group.
Operation
The fees paid to Non-Executive Directors are determined by the Board of Directors as a whole and the fee paid to the Chairman is determined by the Remuneration Committee.
Non-Executive Directors and the Chairman receive a single base fee. Additional fees may be payable for additional Board duties, such as acting as Chair of the Audit, Nomination
and Remuneration Committees, and to the Senior Independent Director. Fee levels are normally reviewed annually, with any adjustments typically made effective from 1 April.
Fees are reviewed by taking into account best practice and appropriate market data including fee levels at other companies of broadly similar size, sector and international
scope to RS Group plc. Time commitment and responsibility are also taken into account when reviewing fees. The Chairman and the Non-Executive Directors may be provided
with accommodation and travel expenses in order to carry out their duties. This may include the settlement by the Company of any associated tax liabilities in relation to these
expenses. Other benefits arising from the performance of duties may be provided.
Opportunity
The fees currently paid to Non-Executive Directors are disclosed in the Annual Report on Remuneration.
Performance measures
Not applicable.
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025118
This part of the Remuneration Report has been prepared in accordance with Part 3 of the revised
Schedule 8 set out in The Large and Medium-sized Companies and Groups (Account and Reports)
(Amendment) Regulations 2013 and Listing Rule 6.6.6R. The Annual Report on Remuneration will be put
to an advisory shareholder vote at the forthcoming AGM.
Proposed Directors’ Remuneration Policy implementation for the year ending 31 March 2026
Executive Directors
Base salary
Base salary for the Executive Directors effective from 1 June 2025 are shown below.
Base salary effective
1 June 2025
Base salary effective
1 June 2024 Change
Simon Pryce £845,000 £772,697 9.4%
Kate Ringrose £530,450 £515,000 3.0%
Consistent with previous years and the principles we apply when reviewing base salary through the
organisation, a number of factors, including performance, market position and relativity to the wider
workforce, were considered by the Committee for the Executive Directors. This year, the average
expected increase for the wider UK workforce is 3% and given Kate’s market competitive package, the
Committee agreed to align her percentage increase to this level. For Simon, the Committee noted that
his salary had fallen materially below the median of our FTSE 75-125 reference group and acknowledged
that we had decided to defer a full review of his package until the Policy review. In this context and
to reflect Simon’s strong performance and leadership during his tenure so far as CEO, after careful
consideration the Committee determined that it was necessary to adjust his salary level to £845,000.
Further detail is provided in the Committee Chair's letter on pages 106 to 111.
Benefits
Benefits will be provided in accordance with the Policy. There are no changes in benefits compared to
the prior year.
Pension
The pension rate for Executive Directors is 10.5% of base salary, which aligns with the rate for the
majority of the wider UK employee population.
Performance-related annual incentive
The maximum annual incentive opportunity for Executive Directors will remain unchanged at 150% of
base salary.
The annual incentive will be based on a balanced set of key financial and strategic targets for the year, as
set out below:
Performance measure Weighting
Adjusted PBT 25%
Adjusted free cash flow 25%
Like-for-like Group revenue change 25%
CO
2
e reduction (Scope 1 and 2 emissions) 10%
Net promoter score 5%
Individual strategic targets 10%
As set out in the Chair's letter on pages 106 to 111, the Annual Incentive for 2025/26 will continue to
be based on key financial and strategic targets for the year. The Committee reviewed the performance
measures and agreed two changes to improve alignment with strategy and our objectives for the
year ahead.
1. Our three financial metrics (like-for-like revenue growth, adjusted PBT and adjusted free cash flow) will
be weighted equally at 25% of the total, creating a better balance between these three key objectives.
2. We will be re-introducing Net Promoter Score into the Annual Incentive (with a 5% weighting) to
ensure that the customer experience, a key objective of our strategy (see page 21), is captured.
The remainder will continue to be based on CO
2
reduction and strategic individual targets.
The Committee retains the discretion within the Policy to adjust the overall incentive outcome to ensure
alignment of pay with performance and fairness to shareholders and participants.
The annual incentive targets are considered to be commercially sensitive and will therefore be disclosed
retrospectively in next year’s report. For 2025/26, before any incentive may be paid, a threshold level of
adjusted PBT must be achieved.
One-third of any incentive earned by Executive Directors will be deferred into shares for a further two
years under the DSBP.
2025 LTIP Award
In line with our new Policy, we propose to adopt a hybrid structure from 2025, combining awards of
Performance Shares and Restricted Shares. Award sizes for the Executive Directors are set out in the
table below. For the reasons outlined in the Chair’s letter on pages 106 to 111, the Committee intends
to utilise the flexibility under the new Policy to grant, on this occasion, Simon’s award at the maximum
level permitted. The Committee’s intention would be that awards to the CEO in subsequent years of the
Policy would revert to the normal award levels of 200% and 50% of salary for Performance Shares and
Restricted Shares, respectively.
Performance Shares Restricted Shares
Simon Pryce 250% of salary 100% of salary
Kate Ringrose 170% of salary 40% of salary
ANNUAL REPORT
ON REMUNERATION
RS Group plc Annual Report and Accounts 2025 119STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Vesting of Performance Shares will be determined in accordance with the following performance targets
measured over the three years ending 31 March 2028 as follows:
Measure Weight
Threshold
(25% of max)
Maximum
(100% of max)
Adjusted EPS CAGR (three-year CAGR of the
2027/28 adjusted EPS, compared with the
2024/25 adjusted EPS)
1
50% 5% 10%
TSR (FTSE 350 index)
1,2
50% Median Upper quartile
ROCE (average of 2025/26, 2026/27,
2027/28)
Underpin 15%
If the underpin is not met, the Committee will review the
formulaic level of vesting and consider whether it would be
appropriate to use its discretion to adjust the level of vesting.
1. Straight-line vesting between measurement points.
2. TSR peer group comprises of the FTSE 350 index, excluding financial services and energy companies.
Taking account of internal forecasts of performance over the performance period, the challenging
market conditions in which the Group operates, our long-term growth ambitions and the expectations
of the investment community of the Group’s future potential performance, the adjusted EPS targets are
considered to be appropriately stretching.
The Restricted Share awards will be subject to the underpin as described in the Policy on page 114.
The award will be subject to a post-vesting holding period of two years.
All employee share plans
Executive Directors can participate in any all employee share schemes offered to all employees on
identical terms, with the exception of the 2025 all-employee award of restricted shares explained on
page 111.
Chairman and Non-Executive Directors
Following a review, the fees for Non-Executive Directors will be increased by 3%. The pay increases for
UK employees are expected to be an average of 3%. As the Chairman’s fee is well positioned against
the FTSE 75-125 peer group, the Chairman’s fee will increase by 2%. With effect from 1 April 2025, the
Chairman’s fees increased from £385,360 to £393,070 and the Non-Executive Directors’ fees were
increased from £67,935 to £69,973. The additional fees for the Audit and Remuneration Committee
Chairman’s fees and the roles in respect of employee engagement increased to £17,000 and £10,000
respectively, whilst the additional fees for the Senior Independent Director remain unchanged at
£15,000.
Implementation of Director’s Remuneration Policy for the year ended
31 March 2025
Single figure for total remuneration for Executive Directors (audited)
The following table provides a single figure for total remuneration of the Executive Directors for the year
ended 31 March 2025 and the prior year.
Simon Pryce Kate Ringrose
2025 2024
1
2025 2024
1
Base salary £768,946 £749,383 £512,500 £250,000
Taxable benefits
2
£17,463 £17,169 £15,458 £7,323
Pension benefit
3
£80,739 £78,770 £53,812 £26,250
Total fixed £867,148 £845,322 £581,770 £283,573
Annual incentive
4
£608,499 £0 £393,975 £0
LTIP – – – –
Buy-out
5,6
– – £141,128 £89,397
SAYE award discount
7
– £4,606 – £4,606
Total variable £608,499 £4,606 £535,103 £94,003
Total £1,475,647 £849,928 £1,116,873 £377,576
1. The total remuneration in 2023/24 for Simon Pryce and Kate Ringrose reflects their respective appointment dates of 3 April 2023 and
2 October 2023.
2. Taxable benefits consists of medical insurance and car allowance.
3. Simon received the amounts shown above as a cash supplement in lieu of pension. In 2024/25, Kate received a contribution of £10,000 to
the defined contribution pension plan and received a further £43,812 as a cash supplement in lieu of pension. No Executive Director has
prospective benefits under a defined benefit pension relating to qualifying service.
4. Annual incentive shows the full value of the annual incentive in respect of each year. For 2024/25 the final outcome of the incentive was
52.5% of maximum for Simon Pryce and 51.0% of maximum for Kate Ringrose. This value will be delivered as one third shares and two
thirds cash (which will vest after two years). For 2023/24 the formulaic outcome of the incentive resulted in no incentive being paid to
either of the Executive Directors.
5. The sign-on vesting value for 2024/25 shows the value of Kate Ringrose’s performance share sign-on award which vested on
30 June 2024. The award granted Kate over 25,973 shares on 14 November 2023. The value of the sign-on award is based on the share
price on the date of vesting of 701.5p. The figure includes dividend equivalent shares to the value of £5,493. The value of Kate’s award
declined over the period between grant and vest by £2,340, due to share price depreciation. Full details of the awards can be found on
page 124.
6. The Buy-out vesting value for 2023/24 details Kate Ringrose’s restricted share sign-on award granted to Kate over 12,527 shares on
14 November 2023. Full details of the awards can be found on page 124.
7. The Save As You Earn (SAYE) Award discount shown for 2023/24 is the difference between the grant date value per share and the exercise
price; the exercise price was 562.00p.
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025120
Incentive outcomes for the year ended 31 March 2025 (audited)
Annual incentive in respect of performance for the year ended 31 March 2025
The performance measures, target ranges and performance against each of the measures for the
2024/25 annual incentive are outlined in the table below. Targeted performance was calibrated to
deliver an incentive of 75% of salary for the Executive Directors (50% of the maximum opportunity), with
incentive payments worth up to 150% of salary for achieving stretch performance targets.
Having reviewed the formulaic outcome the Committee determined together with management that it
would be appropriate to reduce the outcome by 1.3% to ensure internal consistency in annual incentive
outcomes across the Group. This results in an adjusted outcome of 44.0% of maximum. Including the
individual strategic measures the adjusted bonus outcomes are 52.5% of maximum for Simon and
51.0% for Kate. Further background on financial and strategic performance for the year ended
31 March 2025 is provided in the Strategic Report.
Full details of the target ranges and performance against each of the measures are as follows:
Measure and weighting Performance level
Payout (% of
max incentive) Target
Actual
performance
Simon Pryce
earned
incentive
(% of max)
Kate Ringrose
earned
incentive
(% of max)
Adjusted PBT (30%
weighting)
1
Threshold 0.0% £255.3m £255.7m 0.3% 0.3%
Target 15.0% £275.3m
Maximum 30.0% £295.3m
Adjusted free cash
flow (30% weighting)
1
Threshold 0.0% £148.4m £220.5m 30.0% 30.0%
Target 15.0% £166.4m
Maximum 30.0% £176.4m
Like-for-like Group
revenue change
(15% weighting)
Threshold 0.0% (0.0)% (1.7)% 0.0% 0.0%
Target 7.5% 3.0%
Maximum 15.0% 5.0%
CO
2
e reduction
(Scope 1 and 2
emissions)
(15% weighting)
Threshold 0.0% 4.5% 7.3% 15.0% 15.0%
Target 7.5% 6.0%
Maximum 15.0% 7.0%
Individual strategic
targets (detailed to
the right and on
page 122)
Up to 10% 8.5% 7.0%
Formulaic incentive
outcome
53.8% 52.3%
Adjusted incentive
outcome
(1.3)% 52.5% 51.0%
1. Both adjusted PBT and adjusted free cash flow exclude restructuring costs. Adjusted PBT target is adjusted to reflect where elements
originally forecast in adjusted PBT in the target have now been moved to adjusting items.
Individual strategic targets Outcomes
Simon
Pryce
Implement the new Group Operating
Model, embed more effective ‘ways of
working’ ensuring effective collaboration
and more efficient strategy execution.
New operating model launched and communicated across the
Group successfully
New accelerator and enabler functions have cost and
benefit plans built into budget with stronger KPI setting
and measurement
‘Working in a Matrix’ sessions created and implemented within
target populations
Delegated authorities revised to reflect new operating model,
approved by the Board and launched across the business in
May 2024
Improve the alignment of the senior
leadership team, enhance management
bench strength, build a talent pipeline,
improve organisation capability and
build an effective and diverse team
capable of delivering the strategic plan.
Strong Chief Information Officer appointed May 2024 and
supported onboarding of new accelerator leads on to the ExCo
Significantly improved succession planning process and
outcomes presented to the Nomination Committee
Upwards of 90% of employees completed values workshop.
Pulse survey 87% v 70% target on values. Now embedded
across employee lifecycle
Completion of the ExCo leadership D&I engagement. 6%
improvement in gender pay gap, 17% improvement on bonus
pay gap. 2.4% increase in women in senior management roles
Women in leadership roles improved to 37% and leaders from
ethnicity backgrounds improved to 10%
80% of Strategic Workforce Planning sessions completed with
actions identified for implementation
Clarify and communicate the investment
thesis and position RS Group more
effectively in equity public markets.
Delivered successful fact-based prelims which clearly explained
outcomes for the year ended 31 March 2024 and provided
clarity for range of expectations for 2024/25
Delivered successful investor event with positive feedback from
investor community
RS Group plc Annual Report and Accounts 2025 121STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Individual strategic targets Outcomes
Simon
Pryce
Continued
Mobilise and execute strategic plan as
approved by the Board in Q4 2024 and
oversee effective delivery.
Aligned execution plan built into all regions and functional
budgets. Progress reviewed in quarterly business reviews.
Improved visibility enables more rapid reaction to changing
external circumstances
Regional business and functional KPIs in place. No baseline
for 2024/25 but actuals being used as baselines for 2025/26
budget and in place by the first quarter of 2025/26
Efficiency improvement review completed and used to target
regions and functions for budgeting and strategic planning in
2025/26 and beyond
Completed Trident in April 2024. Risoul outperforming
investment case. Distrelec materially over-delivering costs
synergies and benefits
Deliver material enhancements to the
customer experience.
Brand architecture approved March 2025 post brand perception
survey in the third quarter of 2024/25. Actively promoted with
strategic suppliers and guiding customer marketing
Common definitions and metrics in place from July 2024,
reported on and reviewed at QBRs and monthly reviews.
NPS used in parallel with brand perception surveys and
standard client lifecycle management and market qualified lead
definitions in place
All revised milestones met. All markets now live on standard
client relationship management except Mexico (cost) and France
(already in place although not currently the Group standard,
will migrate Q1 2025/26). Customer data ingestion and
normalisation complete. 97% match rate to NAIC/SIC codes
Deliver-to-promise release one on revised time to cost but more
issues than anticipated. Release two delayed until April 2025
Individual strategic targets Outcomes
Kate
Ringrose
Mobilise, establish and plan and
move into delivery mode on
strategic execution.
Strategy delivery and execution office established with
prioritised and sequenced initiatives approved by functions
and regions
Process harmonisation value pools identified, design phase
delivered on time and on budget. Modular process agreed with
2025/26 priorities defined
Investment Proposal process designed and rolled out to the
business. Further work to be done to embed
Strategy delivered with marked evolution from prior year, with
further improvements on process clearly identified
Finalise the appointment of the
Finance leadership team and reporting
structures with increase in capability
in Financial Planning & Analysis (FP&A)
and business decision support, clear
succession routes and demonstrable
diversity of thought and background.
Completed significant recruitment into Finance leadership roles
and their direct reports with increased capability for technical,
FP&A and business partnering talent
Development plans in place for all Finance leadership roles and
high performance candidates with actions executed
Established a process improvement plan in finance to improve
output and improving operating leverage to revenue growth
Solidify the performance management
foundations with structures to
enable clear decision making for
resource allocation and ongoing
performance management.
Business performance management structure – calendar,
priorities and standardised templates designed, agreed
and operational
Organic investments defined with prioritisation criteria and
governance oversight – M&A plan approved in strategy
Successful Group strategy process approved by the Board
including strategic initiatives, KPIs and financial outcomes
Group business plan process approved by the Board including
costed execution of strategic plan, KPIs and milestones and
financial outcomes
Establish a framework for investment
at country level to encompass physical,
process and system infrastructure based
on current and potential growth.
De-prioritised for other strategic projects and navigating
challenging business environment
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025122
J2G LTIP Award
An award of shares was made under the J2G LTIP Award in May 2023 to Simon Pryce over 355,427
shares. Kate Ringrose did not participate in the J2G LTIP Award. The J2G LTIP Award was subject to
vesting based on exceptionally stretching targets of 70% on EPS CAGR and 30% on the Company’s
performance against Key Performance Indicators, with a ROCE underpin over the three years ended
31 March 2025. The threshold level of performance was not achieved for any of the performance
measures, except for on-time-to-promise.
Having considered the plan performance in the broader context of the business performance and
stakeholder outcomes during the three-year plan period, the Committee determined it was appropriate
for the J2G LTIP Award to lapse in full for Simon Pryce, but to vest awards for other participants in line
with the formulaic outcome. This aligns with the view set out in the Chair’s letter on pages 106 to 111
that the J2G LTIP Award was not the appropriate mechanism for the CEO on joining the Company and
that the Committee plans to address his overall remuneration in the Policy.
Performance targets, and actual performance against these, is summarised in the tables below:
Measure Weight
Threshold
(0% of max)
Maximum
(100% of max)
Performance
achieved
Vesting (% of
maximum)
Adjusted EPS CAGR (three-year
CAGR of the 2024/25 adjusted
EPS compared with the 2021/22
adjusted EPS)
70% 15% 21% (8.7)% 0%
Key long-term performance
indicators (KPIs) scorecard (on the
right)
30% 1% 1%
ROCE (average of 2022/23,
2023/24, 2024/25)
Underpin at 20%
If the underpin is not met, the Committee
will review the formulaic level of vesting and
consider whether it would be appropriate
to use its discretion to reduce the level of
vesting.
21.1%
Final J2G LTIP Award vesting 1%
The detail of the individual scorecard KPIs including performance targets, and actual performance
against this is summarised below:
Weighting Measure Threshold Maximum
Performance
achieved
Vesting (% of
maximum)
Cultural
transformation
7.5% Employee engagement score
To be measured based on the 2024/25
Group employee engagement survey
outcome.
Upper
quartile
Upper
decile
Median 0%
Operational
efficiency
7.5% On-Time-To-Promise
Available product delivered when
expected in a cost effective and efficient
manner. Performance to be measured
over the three-month period ended
31 March 2025.
95% 98% 95.4% 1%
Growth
accelerators
5.0% Web revenue
Increased web traffic, increasing
average order value and increasing
average order frequency. Performance
to be measured on web revenue
CAGR over the three-year period
ended 31 March 2025.
12.0% 14.5% 1.6% 0%
5.0% Service solutions revenue
To be more solutions led, solve
customers’ challenges, drive value to
stakeholders and drive greater customer
loyalty and pull through products.
Performance to be measured on service
solutions revenue CAGR over the
three-year period ended 31 March 2025.
12.5% 15.5% 9.7% 0%
5.0% New product introduction (NPI)
revenue
A wider product range, driven by
data insights to ensure it is relevant,
increases customer loyalty and helps the
Group become their first choice. It also
represents deeper supplier relationships.
A product is included as an NPI for 12
months from its introduction into the
Group’s product range. Once it has been
in the Group’s product range for a year,
its future revenue is not included in NPI
revenue. Performance to be measured
on NPI revenue CAGR over the three-year
period ended 31 March 2025.
14.5% 26.0% 8.4% 0%
RS Group plc Annual Report and Accounts 2025 123STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Kate Ringrose sign-on arrangements
As set out in last year’s report, the Committee carefully considered the approach to compensating Kate
Ringrose for the forfeiture of equity awards from her previous employment with Centrica plc. It was
determined that two replacement awards would be granted and that these would remain subject to
performance conditions, where appropriate and would mirror the vesting and release schedule of the
forfeited awards. The first of these awards vested on 30 June 2024. The detail of these replacement
awards and the outcome is shown below.
Grant date Award mechanism
Maximum
value at
grant date
Shares
awarded Performance conditions
1
Normal
vesting date
2
Performance
achieved
2
14 November
2023
3
Performance
shares
£162,330 25,973 This award was based on the
disclosed performance of the
equivalent forfeited award in
Kate’s previous employer.
30 June
2024
74.4%
14 November
2023
Restricted
shares
£89,397 12,527 None. 30 June
2025
1. The outcome of the performance sign-on was determined by the final outcome of the Centrica 2021 LTIP plan, as documented in the
Centrica plc 2023 Annual Report & Accounts, and validation of Kate’s forfeiture of the original awards. The formulaic outcome of the plan
was 85% based on the Centrica plc 2023 Annual Report & Accounts. Following consideration of the formulaic Centrica plan outcome and
the final validation of forfeiture, the Committee determined 19,335 shares would be available to vest on 30 June 2024 (3,413 shares lapsed
for performance and 3,225 shares were lapsed on the basis there was no personal loss).
2. Both of the above awards made to Kate will be subject to a two-year post vest holding period.
3. Kate also received additional RS shares as compensation for the dividend equivalent shares forfeited with Centrica plc. For the award
vesting on 30 June 2024 over 783 shares were awarded.
2022 LTIP Awards vesting
Neither Executive Director participated in this award. However, for reference, the performance
measures, target ranges and performance against each of the measures over the three years ended
31 March 2025 are summarised in the table below:
Measure Weight
Threshold
(25% of max)
Maximum
(100% of max)
Performance
achieved
Vesting
(% of maximum)
Adjusted EPS (three-year
CAGR of the 2024/25
adjusted EPS, compared
with the 2021/22 adjusted
EPS)
1
50% 7% 15% (8.7)% 0%
TSR (vs industrial/electronic
peer group)
1,2
50% Median Upper
quartile
Below
median
0%
ROCE (average over
2022/23, 2023/24, 2024/25)
Underpin 20% 21.1%
Total 2022 LTIP Award
vesting
0% 0%
1. Straight-line vesting between measurement points.
2. TSR peer group comprises ABB, Arrow Electronics, Avnet, Bunzl, Datwyler, Essentra, Fastenal, Ferguson, MSC Industrial Direct, Rexel,
Rockwell, Schneider, Siemens, TE Connectivity, WESCO International and WW Grainger.
Scheme interests awarded during the year ended 31 March 2025 (audited)
2024 LTIP Award
During the year the following LTIP Awards were granted to the Executive Directors:
Simon Pryce Kate Ringrose
Basis of award (% of base salary) 250% 250%
Number of performance shares
awarded
1
272,999 181,953
Award date face value £1,931,741 £1,287,499
Performance period 1 April 2024 – 31 March 2027
Threshold vesting outcome 25%
Post-vesting holding period Two years
1. Awards were made using the average of the share price for the five dealing days immediately preceding the date of grant, being
5 June 2024 of 707.60p. The shares were awarded as performance shares, the performance conditions are detailed on page 125.
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025124
The performance conditions are as follows:
LTIP targets
Measure Weight
Threshold
(25% of max)
Maximum
(100% of max)
Adjusted EPS CAGR (three-year CAGR of the 2026/27
adjusted EPS compared with the 2023/24 adjusted EPS)
1
50% 5% 10%
TSR (vs industrial/electronic peer group)
1,2
50% Median Upper
Quartile
ROCE (average of 2024/25, 2025/26, 2026/27) Underpin at 15%
If the underpin is not met, the Committee will review
the formulaic level of vesting and consider whether it
would be appropriate to use its discretion to reduce
the level of vesting.
1. Straight-line vesting between measurement points.
2. TSR peer group is detailed on page 124.
SAYE
No SAYE awards were granted to Simon Pryce or Kate Ringrose in the year ended 31 March 2025.
Total pension entitlements (audited)
The pension rate for Executive Directors is 10.5% of base salary, which aligns with the rate for the
majority of the wider UK employee population.
External appointments
Simon Pryce was appointed non-executive director of Smiths Group plc on 1 February 2025. His fees for
the year ended 31 March 2025 were £13,493. Kate Ringrose does not have any external appointments.
Chairman and Non-Executive Director remuneration
Single figure for total remuneration for Non-Executive Directors (audited)
The table below sets out a single figure for the total remuneration received by each Non-Executive
Director for the year ended 31 March 2025 and the prior year:
Total fees Taxable expenses Total
2025 2024 2025 2024 2025 2024
Rona Fairhead £385,360 £377,804 £3,998 £6,037 £389,358 £383,841
Alex Baldock £67,935 £66,601 £583 £984 £68,518 £67,585
Louisa Burdett £82,935 £81,601 £735 £498 £83,670 £82,099
Carole Cran
1
£22,645 – £3,351 – £25,996 –
Navneet Kapoor
2
£50,951 £66,601 £3,009 £11,450 £53,960 £78,051
Bessie Lee £72,935 £71,601 £9,343 £9,493 £82,278 £81,094
Miles Roberts
1
£5,661 – £51 – £5,712 –
David Sleath £82,935 £81,601 £660 £551 £83,595 £82,152
Joan Wainwright £87,935 £87,409 £12,431 £14,097 £100,366 £101,506
1. Carole Cran and Miles Roberts were appointed as Directors of the Board on 1 December 2024 and 1 March 2025 respectively.
2. Navneet Kapoor stepped down from the Board on 31 December 2024.
For 2024/25, the Non-Executive Directors received base fees of £67,935 per annum. Fees were paid on
a pro rata basis reflecting length of time in the role. Additional fees of £15,000 per annum were paid
in respect of the Senior Independent Director role and to the Chairs of the Audit and Remuneration
Committees. The Chair of the Nomination Committee role was conducted by Rona Fairhead, Chairman.
Rona did not receive an additional fee for chairing the Nomination Committee. Bessie Lee and
Joan Wainwright each received an additional fee of £5,000 per annum for their role as the Board’s
representatives on employee engagement.
RS Group plc Annual Report and Accounts 2025 125STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Percentage change in remuneration of the Directors and employees as 31 March 2025
The table below shows the percentage change in the annual cash remuneration of the Directors (comprising base salary/fees, the value of taxable benefits and earned annual incentives), as disclosed in the single
figure for total remuneration (tables on page 120 for Executive Directors and on page 125 for the Non-Executive Directors) from the prior year compared with the average percentage change for all UK employees of
RS Group plc. If the Directors did not serve a full year their base salary/fee is annualised.
The downward change in incentive reflects the material reduction in incentive payout levels for the year ending 2024/25 compared to the prior year. Benefits provided for broader employees include medical
insurance and for some employees vehicle or vehicle allowance. The downward change in benefits for broader employees is explained by the continued transition from traditional fuel vehicles into electric/
hybrid vehicles.
Base salary/fees Taxable benefits Annual incentive
Change
2024/25
Change
2023/24
Change
2022/23
Change
2021/22
Change
2020/21
Change
2024/25
Change
2023/24
Change
2022/23
Change
2021/22
Change
2020/21
Change
2024/25
Change
2023/24
Change
2022/23
Change
2021/22
Change
2020/21
Simon Pryce
1
2.6% 850.3% 2.8% 9.6% 0% 1.7% 100% N/A N/A N/A 100% N/A N/A N/A N/A
Kate Ringrose
2
1.7% N/A N/A N/A N/A 4.7% N/A N/A N/A N/A 100% N/A N/A N/A N/A
Rona Fairhead
3
2.0% 3.0% 4.8% 223.1% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Alex Baldock
4
2.0% 3.0% 4.8% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Louisa Burdett 1.6% 2.4% 3.9% 9.6% 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Carole Cran
5
N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Navneet Kapoor
6
2.0% 23.5% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Bessie Lee
7
1.9% 2.8% 5.8% 9.8% 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Miles Roberts
5
N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
David Sleath
8
1.6% 2.4% 3.9% (2.1)% 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Joan Wainwright
9
0.6% 24.0% 7.0% 9.8% 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
UK-based ExCo and employee
population
10
4.3% 7.4% 8.1% 1.9% 1.3% (6.8)% (8.3)% 5.6% (6.4)% (1.5)% (251.6)% 17.1% 20.3% 17.7% 114.5%
1. Simon Pryce stepped down as Chair of the Remuneration Committee on 14 March 2023 and as a Non-Executive Director with effect from 2 April 2023, following confirmation of his appointment as CEO of the Group effective 3 April 2023. The very large percentage increase for 2023/24
simply reflects this transition of Simon’s role from a Non-Executive Director to an Executive Director.
2. Kate Ringrose was appointed as CFO of the Group effective 2 October 2023.
3. Rona Fairhead was appointed to the Board on 1 November 2020 as Non-Executive Director and received the Non-Executive Director base fee until she became Chairman and Chair of the Nomination Committee on 1 February 2021, at which point her fee was increased to the
Chairman’s fee at that time of £350,000.
4. Alex Baldock was appointed to the Board on 1 September 2021.
5. Carole Cran and Miles Roberts were appointed to the Board on 1 December 2024 and 1 March 2025 respectively.
6. Navneet Kapoor was appointed to the Board on 1 June 2022 and stepped down from the Board on 31 December 2024.
7. Bessie Lee was appointed as Board employee engagement representative on 1 June 2021.
8. David Sleath stepped down as Chair of the Nomination Committee on 31 January 2021.
9. Joan Wainwright was appointed as Board employee engagement representative on 1 June 2021 and Chair of the Remuneration Committee on 14 March 2023.
10. The annual percentage change in annual incentive is calculated by reference to the annual incentive payable in respect of performance applicable to the financial year for Executive Directors and by reference to all incentive payments received during the financial year for all employees.
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025126
Performance graph and table
The following graph shows the 10 year TSR performance of the Company relative to the FTSE 250, FTSE
100 and All Share Indices. The FTSE All Share, FTSE 100 and FTSE 250 are broad equity market indices of
which RS Group plc has been a member in this period.
The table below details the CEO’s single figure of remuneration for the same period.
Total shareholder return
(value of £100 invested on 31 March 2015).
0
50
100
200
300
400
150
250
350
450
550
500
2015 2016 2017 2018 2019 2020 2021 2022 2023 20252024
— FTSE 250— FTSE 100— FTSE All Share
—
RS Group
Source: Datastream
CEO pay ratio reporting
25th percentile pay ratio Median pay ratio 75th percentile pay ratio
Year Method Salary
Total pay
& benefits Ratio Salary
Total pay
& benefits Ratio Salary
Total pay
& benefits Ratio
2025
1
A £25,479 £27,978 30:1 £32,860 £36,876 23:1 £52,496 £60,689 14:1
2024 A £24,209 £27,455 31:1 £30,512 £35,284 24:1 £49,768 £59,203 14:1
2023 A £22,442 £25,349 104:1 £27,422 £32,845 80:1 £44,000 £55,134 48:1
2022 A £21,048 £22,552 115:1 £25,000 £27,770 93:1 £40,137 £46,333 56:1
2021 A £20,277 £25,813 99:1 £24,000 £31,404 88:1 £37,664 £51,858 49:1
2020 A £18,050 £20,427 207:1 £22,000 £25,424 166:1 £33,721 £40,300 105:1
1. UK-based employee data and the CEO data was taken as at 31 March 2025.
The Company adopted Method A in the regulations to calculate the pay ratios because this is considered
to be the most statistically robust methodology. Under Method A, the total pay and benefits has been
calculated on a full-time equivalent basis to identify the 25th percentile, median and 75th percentile
people. No elements of pay have been omitted from the calculation and there has been no deviation
from the single figure methodology.
A significant portion of CEO pay is delivered as variable pay; as Simon Pryce did not have a bonus pay
out or LTIP vest during 2024/25, this has resulted in CEO ratio remaining consistent with the prior year.
We anticipate this increasing in future years when variable payments are made to the CEO. In line with
the Company’s reward practices, the median pay ratio employee receives a base salary at market rates
for their role and is eligible for the full range of benefits available to their peers of the same level within
the organisation.
Year ended
31 March
2016
Year ended
31 March
2017
Year ended
31 March
2018
Year ended
31 March
2019
Year ended
31 March
2020
Year ended
31 March
2021
Year ended
31 March
2022
Year ended
31 March
2023
Year ended
31 March
2024
Year ended
31 March
2025
Year Lindsley Ruth Lindsley Ruth Lindsley Ruth Lindsley Ruth Lindsley Ruth Lindsley Ruth Lindsley Ruth Lindsley Ruth
2
David Egan
3
Simon Pryce Simon Pryce
CEO total remuneration (£000s) 2,072 1,401 4,410 4,421 2,551 2,578 2,976 1,813 487 850 1,476
Annual incentive award
(as a % of maximum opportunity)
23.8% 82.5% 90.1% 68.0% 21.7% 80.8% 80.0% 63.2% 63.2% 0%
4
52.5%
LTIP award vesting
(as a % of maximum opportunity)
N/A
1
N/A
1
100% 100% 91.3% 74.7% 46.0% 50.0% 50.0% N/A
5
N/A
5
1. Lindsley Ruth joined the Company in 2015 and therefore did not receive any vested LTIP Awards in 2016 and 2017.
2. Lindsley Ruth’s remuneration for the year ended 31 March 2023 is pro-rated to reflect that he stepped down from the role of CEO on 16 December 2022.
3. David Egan’s remuneration for the year ended 31 March 2023 has been adjusted to reflect the period he acted as CEO (3 November 2022 to 31 March 2023).
4. Simon Pryce did not receive an incentive award for the year ended 31 March 2024. Full details of the incentive outcomes are detailed on page 107 of last year’s report.
5. Simon Pryce was appointed as CEO in 2023 and did not receive any vested LTIP Awards in 2024 and 2025.
RS Group plc Annual Report and Accounts 2025 127STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Payments for Loss of office (audited)
There were no payments for loss of office during the year.
Payments to past directors (audited)
There were no payments to past directors other than those previously disclosed on page 112 of last
year’s report.
Relative importance of spend on pay
The graphs below show total dividends paid by the Company to shareholders and expenditure on total
employee pay for the year and the prior year, and the percentage change year on year.
24/2523/24
105
104
Dividend
£m
1%
24/2523/24
496
470
Total employee pay expenditure
£m
6%
The total employee pay expenditure figures above include labour exit costs set out in Note 8 on
page 160.
Directors’ shareholdings (audited)
The interests of the Directors and their connected persons in the Company’s ordinary shares are
shown to the right, together with total share awards and share options and information on whether the
Executive Directors had met their shareholding requirements on 31 March 2025. For 2024/25, Executive
Directors were expected to start to build up a personal holding to 400% of salary in RS Group plc shares.
Under the Policy it is proposed to reduce the shareholding requirement of the CFO role to 250% of
salary consistent with market practice.
Share awards held Options held
Owned
outright
Shareholding
guideline
% base salary
Current
holding
% salary
Guideline
met?
Unvested,
not subject to
performance
(A)
LTIP
unvested,
subject to
performance
(B)
DSBP
unvested,
not subject to
performance
(C)
SAYE
unvested,
not subject to
performance
(D)
Simon Pryce 186,947 400% 154% No – 864,840 – 3,300
Kate Ringrose 25,511 400% 32% No 12,527 357,121 – 3,300
Rona Fairhead
1
12,541
Alex Baldock 2,239
Louisa Burdett –
Carole Cran 3,000
Navneet Kapoor –
Bessie Lee –
Miles Roberts 7,860
David Sleath 26,305
Joan Wainwright –
1. Rona Fairhead’s shareholding has decreased since 2023/24 due to a change in the classification of persons closely associated with her.
The value of the shares used to calculate whether the shareholding guideline is met is 636.00p,
being the average share price over the three months ended 31 March 2025. Between the year end
and the date of this Annual Report and Accounts, there has been no movement in current Directors’
shareholdings. Details of the scheme interests contained in columns A–D of the table above are provided
in the ‘Share Awards’ table on page 129.
Executive Directors’ service contracts
Simon Pryce entered a service contract with an effective date of 3 April 2023. Kate Ringrose entered a
service contract with the Company with an effective date of 2 October 2023. Both contracts have no fixed
term and are subject to 12 months’ notice by either party.
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025128
Director’s share scheme interests (audited)
Share awards
Scheme Notes Date of award
Shares awarded
on 1 April 2024
Awarded during
the year
Vested during
the year
Lapsed during
the year
Shares held
on 31 March 2025
Normal
vesting date
Simon Pryce LTIP 1 26 May 23 236,414 – – – 236,414 26 May 26
LTIP 1 5 Jun 24 – 272,999 – – 272,999 5 Jun 27
J2G LTIP 1 26 May 23 355,427 – – – 355,427 21 Jul 25
Total 591,841 272,999 864,840
Kate Ringrose Performance sign-on 2,3 14 Nov 23 25,973 783 20,118 6,638 – 30 Jun 24
Restricted sign-on 4 14 Nov 23 12,527 – – – 12,527 30 Jun 25
LTIP 1 14 Nov 23 175,168 – – – 175,168 26 May 26
LTIP 1 5 Jun 24 – 181,953 – – 181,953 5 Jun 27
Total 213,668 182,736 20,118 6,638 369,648
1. All awards made to the Executive Directors under the LTIP and J2G LTIP awards are subject to performance conditions set out on page 123. The normal vesting date for the LTIP award is the third anniversary of grant.
2. The outcome of Kate Ringrose’s performance sign-on was determined by the final outcome of the Centrica 2021 LTIP plan, as documented in the Centrica plc 2023 Annual Report & Accounts, and validation of Kate’s personal forfeiture from the original awards as set out on page 124.
3. Shares in lieu of dividends were awarded to Kate Ringrose upon vesting of the Performance sign-on award.
4. The restricted sign-on award is not subject to performance conditions and therefore has been disclosed in the Single Figure Remuneration table on page 120 accordingly.
Share options
Scheme Date of grant Vesting date Expiration date Exercise price
Shares under option
1 April 24
Granted during
the year
Exercised during
the year
Lapsed during
the year
Shares under option
31 March 2025
Simon Pryce SAYE 6 Dec 23 1 Feb 27 31 Jul 27 562.00p 3,300 – – – 3,300
Total 3,300 – – – 3,300
Kate Ringrose SAYE 6 Dec 23 1 Feb 27 31 Jul 27 562.00p 3,300 – – – 3,300
Total 3,300 – – – 3,300
RS Group plc Annual Report and Accounts 2025 129STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Summary of shareholder voting
Summarised below are the results at the 2024 AGM vote on the 2024 Directors Remuneration Report
(excluding the part summarising the Policy) and the 2022 AGM vote on the 2022 Remuneration Policy:
2024 vote on Directors’ Remuneration Report Total number of votes % of votes cast
For (including discretionary) 375,321,797 86.99%
Against 56,138,542 13.01%
Total votes cast (excluding withheld votes) 431,460,339
Votes withheld 41,173
Total votes (including withheld votes) 431,501,512
2022 vote on Directors’ Remuneration Policy Total number of votes % of votes cast
For (including discretionary) 230,629,838 60.77%
Against 148,894,394 39.23%
1
Total votes cast (excluding withheld votes) 379,524,232
Votes withheld 25,152,385
Total votes (including withheld votes) 404,676,617
1. For further details regarding the low vote for the 2022 Directors’ Remuneration Policy, see page 116 of the Annual Report and
Accounts 2023.
Advisors
Alvarez & Marsal (A&M) has provided independent advice to the Committee since its appointment in
2023. A&M is a member of the Remuneration Consultants Group and voluntarily operates under the
Code of Conduct in relation to executive remuneration consultancy in the UK (details of which can be
found at remunerationconsultantsgroup.com). There is no connection between A&M, the Company
or its Directors.
During the year A&M provided advice in several areas, including:
– Independent advice to support the Committee in setting performance targets and to develop
the Policy
– Support in drafting the Directors’ Remuneration Report for the year ended 31 March 2025
– Updates to the Committee on regulatory changes and the investor environment
A&M’s fees for the provision of executive remuneration consultancy services to the Committee during
the year, charged on a time and materials basis, totalled £182,400.
Remuneration for the wider workforce
The remuneration for the wider workforce is based on principles broadly aligned with the Policy.
Annual salary reviews across the Group consider business performance, local pay and market conditions,
individual performance and salary levels for similar roles in comparable companies.
All employees, including the Executive Directors, ExCo members and senior leaders from across
the Group are eligible to participate in an incentive programme. In line with typical market practice,
opportunities and performance measures vary by organisational level, geographical region and an
individual’s role. Members of the ExCo are eligible to participate in the DSBP and LTIP on similar
terms, including share ownership requirements. Differences apply where appropriate (e.g. in the grant
levels awarded). Senior leaders may also be invited to participate in the LTIP or receive Restricted
Share awards. All our eligible employees can participate in the Company’s all employee share plans.
This includes an all employee RS YAY! Award as set out on page 122 of the Annual Report and
Accounts 2023.
It is important that our people have the opportunity to share in the success of the business that they
help create. We achieved this in 2024/25 through:
Refresh of the Group's reward philosophy to underpin the Group's strategy and values
– Launch of a global recognition programme and platform aligned to the Group's values
– Providing the opportunity for all of our employees at all levels of the organisation to participate in an
incentive programme
– The extension of a personal performance measure in the Group Annual Incentive for management
level employees
– Transition of the LTIP to a restricted share plan below the ExCo
– Providing a SAYE plan to help our UK employees become shareholders
– Providing a phantom SAYE plan in those countries outside the UK where it is legally possible to do so
(which is cash settled for participants)
Consideration of employment conditions elsewhere in the Group
The Group seeks to promote and maintain good relations with employee representative bodies,
including trades unions and works councils, as part of its broader employee engagement strategy and
consultation on matters affecting our people and business performance as required, in each case, by
law and regulation in the jurisdictions in which the Group operates. The Committee is mindful of the pay
increases, incentive outcomes and share award participation in relevant markets across the rest of the
Group when considering the remuneration of the Executive Directors. Our people have the opportunity
to discuss various topics including the Policy and framework via various internal forums. One such forum
is the employee engagement sessions held with Bessie Lee and Joan Wainwright, in their capacity as
engagement designated Non-Executive Directors. Further information regarding the sessions held
during the year can be found on page 88.
Directors’ Remuneration report continued
RS Group plc Annual Report and Accounts 2025130
Committee governance
Committee structure and meetings
The Committee is comprised of independent members. Joan Wainwright was appointed as Chair in
March 2023. Joan has been a member of the Committee since July 2021 and therefore meets the
requirements of the Code. Miles Roberts joined the Committee on 1 March 2025. There have been no
further changes to Committee membership during the year. Details of the skills and experience of the
Committee members can be found on pages 80 and 81.
The Committee held four scheduled and two unscheduled meetings during the year. Details of
attendance at meetings can be found on page 82.
The Chairman of the Board, CEO, CFO, other Board members, Company Secretary, CPO, Vice President,
Group Reward and Director, Executive Remuneration were invited to attend Committee meetings
to advise on specific items and on matters relating to the performance and remuneration of senior
managers, other than in relation to their own remuneration. The Company Secretary acts as Secretary
to the Committee. Meetings of the Committee generally take place shortly before Board meetings, and
activities of the Committee are reported by the Chair to the Board as a separate agenda item.
The Committee Chair attends the Company’s AGM and is happy to answer any questions from
shareholders on matters falling within the Committee’s responsibilities. As described above, the
Committee Chair is also one of the Non-Executive Directors designated to undertake employee
engagement, therefore also providing employees the chance to raise direct remuneration-related
questions during the year.
Committee responsibilities
The role of the Committee is to consider the remuneration packages designed to promote
the long-term success of the Company and to ensure that Executive Directors and the ExCo
are compensated appropriately for their contributions to the Group’s performance, taking into
consideration the wider employee group. The Committee also considers the remuneration of the
Chairman of the Board. The Board determines the remuneration of the Non-Executive Directors.
No individual is present while decisions are made regarding their own remuneration.
The Committee’s key responsibilities have not changed during the year. The Committee’s Terms of
Reference are reviewed formally and approved annually and are available at: rsgroup.com
Committee evaluation
This year, the Board underwent an internally facilitated evaluation of its performance and the activities
of the Committee were reviewed as part of this process. The results of this evaluation demonstrated
that the Committee continued to operate effectively and in alignment with its Terms of Reference.
Further details of the evaluation process can be found in the Corporate Governance Report on pages 89
and 90.
Compliance with the UK Corporate Governance Code
For the reporting year, the Committee considers that the executive remuneration framework
appropriately addresses the factors under Provision 40 of the UK Corporate Governance Code (the Code)
as set out below. As well as a focus on Executive Director remuneration, the Committee has oversight for
the remuneration policies of the Group to ensure alignment with the strategic priorities of the Company.
We value the contribution our people make to the success of the Group and charge management with
the responsibility for ensuring a sustainable approach to their remuneration. It is important to the
Committee that the Group’s employees are paid at a fair level reflecting the skills they bring. We use
benchmarking information to ensure we pay competitively to attract and retain talent. Part of building
a sustainable Group is ensuring our employees have an opportunity to share in the success they help
create. How this is achieved is outlined in the Committee Chair’s letter on page 111. We engage regularly
with our employees on remuneration in general. None of our employees raised questions on executive
remuneration during the year, including in our open forums, engagement surveys or our specific Board
employee engagement sessions. Over the past year we have had a regular communication cadence
to highlight the range of benefits available to our employees including our annual incentive, financial
planning, medical, employee discounts and fleet offerings.
Factors under Provision 40
Clarity We provide open and transparent disclosures of our Executive Directors’
remuneration arrangements including undertaking engagement with key
shareholders when considering changes to our Remuneration Policy.
Simplicity We aim to ensure that remuneration arrangements for both our Executive
Directors and the wider workforce are as simple as possible to drive
understanding and engagement, and we take time to engage with
participants and shareholders.
Predictability Our Remuneration Policy contains details of maximum opportunity levels for
each component of pay, with actual incentive outcomes varying depending
on the level of performance achieved against specific measures.
Proportionality, risk and
alignment to culture
The metrics used to measure performance for annual incentive and LTIP
awards drive behaviours that are consistent with the business strategy and
values of the organisation.
The annual incentive and LTIP structures do not encourage inappropriate
risk-taking. They are subject to the achievement of stretching performance
targets and the Committee has the ability to apply discretion to the formulaic
outcomes. Malus and clawback provisions also apply for both the annual
incentive and LTIP. Annual incentive deferral, LTIP holding periods and our
shareholding guidelines provide a clear link to the ongoing performance of the
business and are therefore aligned with shareholder interests.
With regards to provision 41, the Policy operated as intended in terms of Company performance
and quantum.
RS Group plc Annual Report and Accounts 2025 131STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Directors’ report
This section (together with the
information on pages 78 to 131 and
other information cross-referenced
by this section which is incorporated
by reference) constitutes the
Directors’ report for the purposes
of the Companies Act 2006
(Companies Act) and fulfils the
requirements of the corporate
governance statement for the
purposes of the Financial Conduct
Authority’s Disclosure Guidance
and Transparency Rules (DTR).
Principal activities
RS Group is a differentiated, high-service global
distributor of product and service solutions
providing small volumes of our suppliers’
products to our industrial customers. RS Group
plc is a public company incorporated in England
and Wales with company number 647788.
A list of the Company’s investments and
subsidiaries at 31 March 2025 can be found in
Note 30 to the Group accounts on pages 187 to
190 of this Annual Report and Accounts.
The principal activity of the Company is to act as
the holding company of the Group.
The Directors are not aware, at the date of this
report, of any major changes in the Group’s
activities in the coming year.
Results and dividends
The Group’s results for the year ended 31 March 2025 are set out in the Group income statement on
page 146.
The Board proposes, subject to approval of shareholders at the AGM to be held on 17 July 2025, that
a final dividend of 13.9p per ordinary share be paid on 25 July 2025 to shareholders whose names
are on the register of members at the close of business on 13 June 2025. The Directors have declared
dividends as follows:
Dividends in 2024/25 Dividends in 2023/24
Interim dividend of 8.5p per ordinary share
(paid on 3 January 2025)
8.3p per ordinary share
Proposed final dividend of 13.9p per ordinary share
(to be paid on 25 July 2025)
13.7p per ordinary share
Total ordinary dividend of 22.4p per ordinary share
for the year ended 31 March 2025
22.0p per ordinary share
During the year under review Computershare Trustees (Jersey) Limited, trustee of the RS Group
Employee Trust has waived its right to receive dividends over its total holding of 5,538,418 shares as
at 31 March 2025.
Appointment and retirement of Directors
The appointment and retirement of Directors is governed by the Company’s Articles of Association
(Articles), the Code and the Companies Act. The Company’s Articles may only be amended by a special
resolution of the shareholders in a general meeting.
In the interest of good governance and in accordance with the provisions of the Code, all Directors will
retire and will seek re-election, or if appropriate, election at the forthcoming AGM.
Biographies of the current Directors can be found on pages 80 and 81. Details of the Directors
seeking re-election at the AGM are set out in the Notice of AGM.
Board composition changes
Changes to the composition of the Board since 1 April 2024 up to the date of this Report are shown in
the table below.
Joined the Board Left the Board
Carole Cran 1 December 2024
Miles Roberts 1 March 2025
Navneet Kapoor 31 December 2024
Information incorporated by reference
The following information required to
be disclosed in this Directors’ Report (in
accordance with Listing Rule (LR) 6.6.6R
and otherwise) is set out on the page
numbers below:
Likely future developments 5 and 7 to 10
Diversity and Inclusion Policy 95
(including disability
1
)
Employee engagement 12, 56 to 60,
79 and 88
Other stakeholder 5, 12, 13, 61
engagement to 63, 79 and 88
Greenhouse gas emissions
1
51
Names of Directors who 80 and 81
served during the year
Details of employee 104 to 111, 114,
share schemes 120 and Note 9
Risk management (including 179 to 183
hedging) and financial instruments
Activity on Company culture 8, 12, 16, 17
and 56 to 60
Long-term incentive schemes 104 to 111, 114,
123, 124 and 125
1. Information required by the Large and Medium-sized
Companies and Groups (Accounts and Reports)
Regulations 2008 and included in the Strategic Report.
DIRECTORS’
REPORT
RS Group plc Annual Report and Accounts 2025132
Directors’ interests
The Directors’ interests in, and options over,
ordinary shares in the Company are shown in
the Directors’ Remuneration report. Since the
year end, there have been no changes to
such interests.
In line with the requirements of the Companies
Act, Directors have a statutory duty to avoid
situations in which they have, or may have,
interests that conflict with those of the Company
unless that conflict is first authorised by
the Board.
The Board has in place a formal conflicts of
interest management procedure. The Board
is responsible for considering whether
authorisation is required, and if it can be
given, in relation to new situations as they
arise. The Board reviews annually any conflict
authorisations it has given and any limitations
that have been applied. The Company’s Articles
contain provisions to allow the Directors to
authorise potential conflicts of interest, so that if
approved, Directors will not be in breach of their
duty under company law.
Powers of the Directors
Subject to the Articles, the Companies Act and
any directions given by special resolution, the
business of the Company will be managed by
the Board, who may exercise all the powers of
the Company. The Board may exercise all the
powers of the Company to borrow money and
to mortgage or charge any of its undertaking,
property and uncalled capital and to issue
debentures or other securities, whether outright
or as collateral security for any debt, liability or
obligation of the Company or of any third party.
Directors’ indemnities
In accordance with the relevant provisions
of the Companies Act and the Company’s
Articles, the Company entered into a new deed
in March 2023 to indemnify the Directors and
Officers (from time to time) of the Company to
the extent permitted by the law. The deed for
existing Directors is available for inspection at
the registered office of the Company.
The Company purchased and maintained
Directors’ and Officers’ liability insurance
throughout 2024/25, which was renewed for
2025/26. Neither the indemnity nor insurance
provides cover in the event that a Director or
Officer is proved to have acted fraudulently.
Substantial shareholders
The processes by which the Company seeks to understand the views of its major shareholders are
described on page 13.
Information provided to the Company by substantial shareholders pursuant to the DTR is published
via a Regulatory Information Service.
As at 31 March 2025 and 20 May 2025, being the last practicable date, the Company had been
notified by its substantial shareholders under Rule 5 of the DTR of the following interests in the
Company’s shares:
Shareholder
Number of
shares as at
31 March 2025
Percentage of
issued share
capital as at
31 March 2025
Number of
shares as at
20 May 2025
Percentage of
issued share
capital as at
20 May 2025
Ameriprise Financial, Inc.
1
47,120,586 9.94% 47,120,586 9.94%
FMR LLC 38,165,532 8.05% 38,165,532 8.05%
Wellington Management Group LLP 23,691,502 5.00% 23,691,502 5.00%
1. Ameriprise Financial, Inc. includes Threadneedle Asset Management Holdings Ltd.
Share capital
As at 31 March 2025, the Company’s issued share capital comprised a single class of 474,049,468
ordinary shares of 10p each, totalling £47,404,946.80.
Full details of share options, awards and shares issued under the terms of the Company’s share
incentive plans can be found in Note 9 on pages 160 to 163.
The Company was authorised by shareholders at the AGM held on 11 July 2024 to purchase up to 10%
of its ordinary share capital in the market. The Company did not make use of this authority during the
year, and in line with market practice, will be seeking to renew such authority at this year’s AGM.
Restrictions on voting rights
A member is not entitled to vote (in person or by proxy) at any general meeting or class meeting
if either: (i) any call or other sum then payable by that member in respect of that share remains
unpaid; or (ii) that member has been served with a notice after failure to provide the Company with
information concerning interests in those shares required to be provided under the Companies
Act. Voting rights may be exercised in person, by proxy or, in relation to corporate members, by a
corporate representative. Proxy forms must be submitted not less than 48 hours before the time of
the meeting or adjourned meeting.
RS Group plc Annual Report and Accounts 2025 133STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
Restrictions on transfer of shares
The Directors may, in the case of shares in
certificated form, in their absolute discretion and
without assigning any reason, refuse to register
any transfer of shares (not being fully paid
shares) provided that such discretion may not be
exercised in such a way as to prevent dealings in
the shares of that class from taking place on an
open and proper basis.
The Directors may also refuse to register an
allotment or transfer of shares (whether fully
paid or not) in favour of more than four persons
jointly, in which case notice of the refusal must
be sent to the allottee or transferee within
two months after the date on which the letter
of allotment or transfer was lodged with the
Company. A shareholder does not need to
obtain the approval of the Company, or of other
shareholders in the Company, for a transfer of
shares to take place.
Political donations
In the year ended 31 March 2025, the Group
made no political donations or contributions.
It remains the Company’s policy not to make
political donations. However, the application of
the relevant provisions of the Companies Act
is potentially very broad in nature and, as it did
last year, the Board will be seeking shareholder
authority to make political donations up to a
defined limit to ensure that the Group does
not inadvertently breach these provisions as a
result of the breadth of its business activities,
although the Board has no intention of using
this authority.
Significant agreements:
change of control
The Company has a number of contractual
arrangements which it considers essential to
the business of the Company. Specifically, these
are committed loan facilities from a number
of banks and arrangements with third-party
providers of administrative services. A change
of control of the Company may cause some
agreements to which the Company is a party to
alter or terminate. These include bank facility
agreements and employee share plans, which
would normally vest and become exercisable on
a change of control, subject to the satisfaction of
any performance conditions at that time.
The Group has committed facilities totalling
£679 million as at 31 March 2025 which contain
clauses which require lender consent for any
change of control. Should consent not be given,
a change of control would trigger mandatory
repayment of the said facilities.
AGM
The Notice of AGM is set out in a separate
circular and is available on our website at
rsgroup.com/investors/shareholder-
information/agm-information.
Shareholders can submit questions relating
to the business of the meeting in advance to
CompanySecretary@rsgroup.com.
Independent Auditors and
audit information
Each of the persons who is a Director at the date
of approval of this Annual Report and Accounts
confirms that:
– So far as the Director is aware, there is no
relevant audit information of which the
Company’s Auditors are unaware; and
– The Director has 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 Company’s Auditors are aware of
that information
This confirmation is given and should be
interpreted in accordance with the provisions of
the Companies Act.
Articles of Association
Any amendments to the Articles of the Company
may be made in accordance with the provisions
of the Companies Act by way of a special
resolution of the Company’s shareholders in a
general meeting. The Articles were last approved
by shareholders at the AGM in 2021/22.
Governance arrangements
Information regarding the Company’s
governance arrangements is set out in the
Governance Report on pages 78 to 134.
These pages are incorporated by reference into
the Directors’ Report.
On behalf of the Board:
Clare Underwood
Company Secretary
20 May 2025
Directors’ report continued
RS Group plc Annual Report and Accounts 2025134
Responsibility of Directors for
annual report and accounts
The Directors are responsible for preparing the
Annual Report and Accounts in accordance with
applicable law and regulation.
Company law requires the Directors to prepare
accounts for each financial year. Under that
law the Directors have prepared the Group
accounts in accordance with UK-adopted
international accounting standards (UK IAS)
and Company accounts in accordance with
United Kingdom Generally Accepted Accounting
Practice (United Kingdom Accounting Standards,
comprising Financial Reporting Standard 102
‘The Financial Reporting Standard applicable in
the UK and Republic of Ireland’ (FRS 102), and
applicable law).
The Directors are responsible for keeping
adequate accounting records that are sufficient
to show and explain the Group 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 accounts and the Directors’
Remuneration Report comply with the
Companies Act 2006.
The Directors are also 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 responsible for the
maintenance and integrity of the Company’s
website. Legislation in the United Kingdom
governing the preparation and dissemination
of accounts may differ from legislation in
other jurisdictions.
The Directors consider that the Annual
Report and Accounts, taken as a whole, is fair,
balanced and understandable and provides
the information necessary for shareholders to
assess the Group and Company’s position and
performance, business model and strategy.
Under company law the Directors must not
approve the accounts 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 and Company for that
period. In preparing the accounts, the Directors
are required to:
– Select suitable accounting policies and then
apply them consistently;
– State whether applicable UK IAS have been
followed for the Group accounts and United
Kingdom Accounting Standards, comprising
FRS 102, have been followed for the Company
accounts, subject to any material departures
disclosed and explained in the accounts;
– Make judgements and accounting estimates
that are reasonable and prudent; and
– Prepare the accounts on the going concern
basis unless it is inappropriate to presume
that the Group and Company will continue
in business.
Each of the Directors, whose names and
functions are listed on pages 80 and 81 confirm
that, to the best of their knowledge:
– The financial statements, prepared in
accordance with the relevant financial
reporting framework, give a true and fair
view of the assets, liabilities, financial position
and profit or loss of the Company and the
undertakings included in the consolidation
taken as a whole;
– The Strategic Report includes a fair review
of the development and performance of the
business and the position of the Company and
the undertakings included in the consolidation
taken as a whole, together with a description
of the principal risks and uncertainties that
they face; and
– the Annual Report and Financial Statements,
taken as a whole, are fair, balanced and
understandable and provide the information
necessary for shareholders to assess the
Company’s position, performance, business
model and strategy.
In the case of each Director in office at the
date the Directors’ Report is approved, 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 and Company’s
Auditors are aware of that information.
Simon Pryce
Chief Executive Officer
20 May 2025
Statement of Directors’ responsibilities
STATEMENT OF
DIRECTORS’ RESPONSIBILITIES
RS Group plc Annual Report and Accounts 2025 135STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE REPORT
FINANCIAL
STATEMENTS
IN THIS SECTION
Independent Auditor’s report 137
Group accounts 146
Company accounts 196
Five-year record 201
136 RS Group plc Annual Report and Accounts 2025
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF RS GROUP PLC
Report on the audit of the financial statements
1. Opinion
In our opinion:
– the financial statements of RS Group plc (the ‘Company’) and its subsidiaries (the ‘Group’) give a
true and fair view of the state of the Group’s and of the Company’s affairs as at 31 March 2025
and of the Group’s profit for the year then ended;
– the Group financial statements have been properly prepared in accordance with United Kingdom
adopted international accounting standards;
– the Company financial statements have been properly prepared in accordance with United
Kingdom Generally Accepted Accounting Practice, including Financial Reporting Standard 102
‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’; and
– the financial statements have been prepared in accordance with the requirements of the
Companies Act 2006.
We have audited the financial statements which comprise:
– the Group income statement;
– the Group statement of comprehensive income;
– the Group and Company balance sheets;
– the Group cash flow statement;
– the Group and Company statements of changes in equity; and
– the related Group notes 1 to 32, and Company notes 1 to 16.
The financial reporting framework that has been applied in the preparation of the Group financial
statements is applicable law and United Kingdom adopted international accounting standards.
The financial reporting framework that has been applied in the preparation of the Company financial
statements is applicable law and United Kingdom Accounting Standards, including FRS 102 ‘The Financial
Reporting Standard applicable in the UK and Republic of Ireland’ (United Kingdom Generally Accepted
Accounting Practice).
2. Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK))
and applicable law. Our responsibilities under those standards are further described in the auditor’s
responsibilities for the audit of the financial statements section of our report.
We are independent of the Group and the Company in accordance with the ethical requirements that are
relevant to our audit of the financial statements in the UK, including the Financial Reporting Council’s (the
‘FRC’s’) Ethical Standard as applied to listed public interest entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. The non-audit services provided to the Group and
Company for the year are disclosed in Note 6 to the financial statements. We confirm that we have not
provided any non-audit services prohibited by the FRC’s Ethical Standard to the Group or the Company.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
3. Summary of our audit approach
Key audit matters
The key audit matters that we identified in the current year were:
– Valuation of inventory obsolescence provisions; and
– Accounting for contractual relationships.
Deloitte LLP was appointed as auditor to the Group on 11 July 2024. This is therefore our first year as
the Group’s auditor.
We identified accounting for contractual relationships as a new key audit matter given the extent of
audit effort required to understand the nature of the relationships across the Group and procedures
to address the identified risks in our first year as auditor.
In addition to identifying the valuation of inventory obsolescence provisions as a key audit matter,
three other key audit matters were identified by the predecessor auditor and described in their audit
report for the year ended 31 March 2024. In respect of these items:
– The fair value of acquired intangibles is not considered as a key audit matter in the current year,
as this related to the Distrelec acquisition in the prior year. Accounting related to the current year
acquisition of Trident was not of the same magnitude or complexity.
– The valuation of defined benefit pension scheme liabilities and carrying value of investments in
the Company balance sheet are not considered key audit matters, as these areas did not have a
significant effect on our overall audit strategy, allocation of resources or direction of efforts of the
engagement team.
RS Group plc Annual Report and Accounts 2025 137STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Materiality
Materiality that we used for the Group financial statements was £11 million. We determined
Group materiality as approximately 5% of adjusted profit before tax including amortisation of
acquired intangibles.
Scoping
We identified 15 components across the Group.
We have focused our audit procedures on five of these components, being the EMEA, APAC
and Americas divisions, Risoul in Mexico and the Group’s head office entities. In addition, audit
procedures were performed on specific account balances at other components. Further details of
our audit scope and identification of components is set out on pages 141 to 142.
Our audit scope addressed 89% of Group revenue, 88% of Group profit before tax and 96% of Group
total assets.
First-year audit transition
The year ended 31 March 2025 is our first year as auditor of RS Group plc. We have been
independent since October 2023 and commenced our transition activities from that date.
Our work included:
– Establishing a detailed audit transition plan;
– Shadowing the previous auditor through the 31 March 2024 audit, including attendance at key
meetings, such as with the Audit Committee;
– Reviewing the previous auditor’s audit files;
– Holding transition workshops with key component finance and operational management, including
internal audit, treasury, tax, legal and Group finance teams to inform our audit planning;
– Considering historical accounting policies and accounting judgements; and
– Holding global audit planning meetings with our component audit teams and conducting
Group audit team visits to key markets and GSBS locations.
These procedures built our understanding of the Group which informed our audit risk assessment,
through which we identified the risks of material misstatement to the Group’s financial statements.
Independent auditor’s report to the members of RS Group plc continued
4. Conclusions relating to going concern
In auditing the financial statements, we have concluded that the Directors’ use of the going concern
basis of accounting in the preparation of the financial statements is appropriate.
Our evaluation of the Directors’ assessment of the Group’s and Company’s ability to continue to adopt
the going concern basis of accounting included:
– understanding the process used to prepare the budget and strategic plan including obtaining an
understanding of relevant controls over management’s going concern model;
– assessing the reasonableness of the assumptions in the budget and strategic plan, including those
relating to the current macroeconomic uncertainty (including the possible impact of trade tariffs)
and evaluating the appropriateness of these assumptions and their consistency with management’s
presentations to the Board and Audit Committee. This included challenging the assumptions used
within the Group’s going concern model by obtaining third-party and market data and evaluating any
differences between this data and the judgements and assumptions used by management;
– evaluating the historical accuracy of forecasts prepared by management;
– testing the mechanical accuracy of the going concern model;
– confirming the existence and availability of financing facilities;
– assessing the Group’s liquidity forecast and performing sensitivity analysis to assess whether there is
sufficient headroom over the going concern period;
– considering the mitigating factors and reasonable downside scenarios identified by management in
relation to their going concern analysis; and
– assessing the appropriateness of the Group’s disclosure concerning the going concern basis
of accounting.
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
Company’s ability to continue as a going concern for a period of at least twelve months from when the
financial statements are authorised for issue.
In relation to the reporting on how the Group has applied the UK Corporate Governance Code, we
have nothing material to add or draw attention to in relation to the Directors’ statement in the financial
statements about whether the Directors considered it appropriate to adopt the going concern basis
of accounting.
Our responsibilities and the responsibilities of the Directors with respect to going concern are described
in the relevant sections of this report.
5. Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our
audit of the financial statements of the current period and include the most significant assessed risks of
material misstatement (whether or not due to fraud) that we identified. These matters included those
which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and
directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
RS Group plc Annual Report and Accounts 2025138
5.1 Valuation of inventory obsolescence provisions
Key audit matter description
The gross inventory balance as at 31 March 2025 was £704.1 million (2024 restated: £724.3 million),
against which provisions of £86.8 million (2024 restated: £86.9 million) were held.
The Group’s business model is based on stocking an extensive range of products, which are delivered
quickly to customers to support critical operations. As a result, the Group holds significant quantities
of inventory on hand across a wide range of products for sustained periods of time, increasing the
risk of inventory obsolescence.
The Group’s inventory obsolescence provision is calculated on an ‘inventory cover’ basis, by
establishing estimated levels of excess inventories through considering the ‘run rate’ of sales, and the
length of time it will require to sell all inventory held. Key assumptions therefore include sales trends,
the number of years of inventory cover, and recoverable amounts to determine provision rates.
In determining the recoverable value, judgement is also required regarding the ability of the Group to
return a proportion of stock to suppliers under supplier specific contractual provisions.
The obsolescence provision is calculated across the Group using either Excel or data analytics (where
the dataset is too large for Excel) in order to analyse excess inventories based on inventory turn
and apply the provisioning percentages to the different categories of products based on historical
recoverability rates. Manual adjustments are applied to the calculated provision by the local finance
teams to account for specific product or market circumstances at the period-end, or where a right to
return is in place in which case no provision may be required.
As set out in Note 18 on page 174 and the Audit Committee Report, the inventory obsolescence
provision is sensitive to changes in these assumptions.
Given the judgement required in determining the sell through rate of inventory (which may take
many years) and the recoverable amount of the inventory balance as a result (including the extent
of supplier specific contractual return provisions), we have identified the assumptions used by
management in determining the inventory obsolescence provision as a key audit matter. This includes
the assumptions regarding stock turn and the provisioning percentages applied to product
categories in the calculation.
Our risk assessment procedures identified certain pools of inventory where we considered there to
be a heightened risk of non-recovery of amounts held on the balance sheet, based on historic sell
through information and as such, we have particularly focused on the provisioning percentages
applied to the newly introduced (‘new product introductions’ or ‘NPI’) stock and slow-moving
product lines.
As described in the financial statements Note 32 and the Audit Committee Report (pages 97 to
103), the Group has recorded a prior period restatement in respect of the inventory provision.
The adjustment relates to certain stock lines being allocated to the wrong category in the calculation
and therefore an incorrect provisioning percentage being applied, and the inconsistent application of
the Group’s provisioning policy. As a result of this, the Group’s inventory balance has been restated by
£13.2 million at 1 April 2023 and by a further £5.4 million for the year ended 31 March 2024. The net
impact on opening reserves as at 1 April 2023 was £10.0 million. There is a £4.3 million impact on
profit after tax in the year ended 31 March 2024.
How the scope of our audit responded to the key audit matter
To respond to this key audit matter, we have:
– Performed a recalculation of the obsolescence provision based on management’s provisioning
policy, with the assistance of our data analytics specialists to assess the mathematical accuracy of
the provision and consistency of application with the Group’s provisioning methodology;
– Tested the completeness and accuracy of inventory data used to calculate the provision by
reconciling the inventory sub-ledger and sales to the Group’s accounting system and selecting a
sample of inventory items and agreeing the cost back to supplier invoice. A sample of sales have
also been tested to assess the validity of the sales data used in the model;
– Tested a sample of stock lines to assess whether they have been classified in the correct product
category in the inventory provision calculation and therefore assigned the right provisioning
percentage based on their classification;
– Recalculated the inventory provisioning percentages in accordance with management’s
methodology and historical write offs;
– Assessed the validity and completeness of manual adjustments made to the provision by
understanding the circumstances relating to the adjustments and agreeing a sample of the
adjustments to supporting documentation. In addition, we have considered the effect of economic
and market uncertainty on specific product groups and whether specific manual provisions are
needed for certain product categories;
– Challenged the reasonableness of management’s assumptions regarding inventory sell through
rates, recoverability and provisioning percentages by analysing trends in historical sales by product
type over the last 7 years and historical inventory write-offs, and assessing the right-to-return of
inventory under supplier specific contractual clauses. We have performed testing on a sample of
products in the NPI and slow moving product categories to understand the contractual terms with
the supplier and historical evidence of returns;
– We have also performed sensitivity analysis in order to understand the impact of reasonably
possible changes in management’s assumptions on the recorded obsolescence provision;
– Evaluated compliance with the disclosures required by the accounting standards relating to a
reasonably possible change in a key assumption, including their clarity and understandability to
users of the financial statements; and
– Assessed the validity and completeness of the prior period adjustment relating to the inventory
provision, specifically we have recalculated the provision in 2023 and 2024 to consider both
whether it has been calculated in accordance with Group policy and whether product lines
have been allocated to the appropriate categories in the calculation. We have also evaluated
management’s disclosure of the prior period adjustment to assess whether compliance with IAS 8
‘Accounting Policies, Changes in Accounting Estimates and Errors’.
RS Group plc Annual Report and Accounts 2025 139STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Key observations
We have identified that review controls over inventory provisioning require improvement, particularly
in relation to the completeness and accuracy of information used in the provision calculation and the
consistent application of the Group methodology. The need for improvement is evidenced through
the identification of a prior period adjustment.
Based on the audit procedures performed, we are satisfied that the valuation of the inventory
obsolescence provision, including the effect of the prior period adjustment, is acceptable.
We are satisfied that the disclosures in the financial statements with respect to the inventory
provision and the related key source of estimation uncertainty and IAS 8 disclosures are appropriate.
5.2 Accounting for contractual relationships
Key audit matter description
The Group enters into contractual relationships with both customers and suppliers, with complexity
in the interpretation and accounting for such arrangements.
These arrangements include, but are not limited to, a variety of rebate and discount arrangements
for both customers and suppliers, integrated supply contracts where the Group acts as an agent on
behalf of customers, pricing mechanisms where discounts granted to customers are recoverable
from vendors, and agreements for the re-purchase of stock by suppliers. Individual arrangements
differ across the Group by region and market. Refer to Notes 2, 5, and 19 for further details regarding
such arrangements.
Given the high volume and varying nature of the relationships, there is a risk that such arrangements
are not identified, or are identified but not appropriately accounted for within the Group’s
financial statements.
Our key audit matter therefore relates to the completeness of and accounting for material, key
contractual relationships across the Group.
How the scope of our audit responded to the key audit matter
To respond to this key audit matter, we have:
– Enquired of local and Group sales, procurement, operational and finance personnel to obtain an
understanding of the existence of contractual relationships across the Group;
– Performed an assessment of all material contracts signed in the year and a sample of all other
significant contracts, to assess the accounting implications of the terms and conditions embedded
within the contracts has been applied appropriately;
– Evaluated the Group’s contract terms and conditions, discounts and rebate arrangements with
customers and suppliers in each relevant region, including an assessment of eligibility criteria,
calculation methodology and resulting accounting entries; and
– Evaluated the appropriateness of disclosures made in the Group financial statements in respect of
such arrangements.
Independent auditor’s report to the members of RS Group plc continued
Key observations
Based on the audit procedures performed, we are satisfied that the Group’s accounting for
contractual relationships is acceptable. We are also satisfied that the disclosures in the financial
statements with respect to such relationships are appropriate.
6. Our application of materiality
6.1 Materiality
We define materiality as the magnitude of misstatement in the financial statements that makes it
probable that the economic decisions of a reasonably knowledgeable person would be changed or
influenced. We use materiality both in planning the scope of our audit work and in evaluating the results
of our work.
Based on our professional judgement, we determined materiality for the financial statements as a whole
as follows:
Group financial statements Company financial statements
Materiality £11.0 million (2024: £12.6 million as
used by the predecessor auditor)
£10.3 million (2024: £5.1 million as
used by the predecessor auditor)
Basis for
determining
materiality
5% of adjusted profit before tax
including amortisation of acquired
intangibles. Adjusting items in
both the current and prior year
relate to acquisition-related items.
Further details are set out in Note 3.
The previous auditor used 5% of
adjusted profit before tax.
The basis for materiality is net assets.
The materiality used represents 1% of
net assets.
The predecessor auditor used 0.5%
of net assets in determining the prior
year materiality.
RS Group plc Annual Report and Accounts 2025140
Group financial statements Company financial statements
Rationale
for the
benchmark
applied
We have determined that the primary
benchmark for materiality for the
Group is profit before tax, because
we consider this measure to be the
primary focus of users of the financial
statements. We also considered
revenue, net assets, and total assets
as relevant metrics to the users of the
financial statements.
Management’s key performance
measure used internally to measure
the Group’s performance and in the
Directors’ remuneration targets is
Adjusted PBT, which excludes certain
‘adjusting’ items to profit before tax,
including amortisation of acquired
intangibles and other items which do
not represent the normal continuing
operations of the Group. See page 121
for further details.
In determining adjusted profit for the
purposes of our materiality, we have
added back amortisation of acquired
intangibles to adjusted profit as
defined above, because the balance
recurs each year.
Our selected materiality represents
0.4% of revenue, 0.8% of net assets,
and 0.4% of total assets.
Due to the nature of the Company as
a parent entity holding company, we
consider net assets to be the most
appropriate basis for materiality.
£2.7m to £5.4m
Component performance
materiality range
£221.5m
Adjusted PBT
including amortisation
of acquired intangibles
£11.0m
Group materiality
£0.55m
Audit Committee
reporting threshold
6.2 Performance materiality
We set performance materiality at a level lower than materiality to reduce the probability that, in
aggregate, uncorrected and undetected misstatements exceed the materiality for the financial
statements as a whole.
Group financial statements Company financial statements
Performance
materiality
70% (2024: 75% as used by
the predecessor auditor) of
Group materiality
70% (2024: 75% as used by
the predecessor auditor) of
Company materiality
Basis and
rationale for
determining
performance
materiality
In determining performance materiality, we considered the following factors:
– our understanding of the entity and its environment;
– our risk assessment, including our assessment of the Group’s overall control
environment; and
– the results of the previous years’ audits performed by PwC LLP, including the
value and quantum of corrected and uncorrected misstatements in prior
periods and our expectation of the likelihood of misstatements recurring in the
current period.
6.3 Error reporting threshold
We agreed with the Audit Committee that we would report to the Committee all audit differences in
excess of £0.55 million (2024: £0.63 million as used by the predecessor auditor), as well as differences
below that threshold that, in our view, warranted reporting on qualitative grounds. We also report to the
Audit Committee on disclosure matters that we identified when assessing the overall presentation of the
financial statements.
7. An overview of the scope of our audit
7.1 Identification and scoping of components
The Group is headquartered in the UK, with operations in more than 30 countries across Europe,
the Middle East, North and South America, and the Asia Pacific. The Group uses three Global
Shared Business Service Centres (GSBS) hubs to support financial reporting across a number of key
business processes.
We identified the Group’s EMEA, Americas and APAC divisions as components, noting their common IT
systems and processes and controls, alongside a series of smaller components relating to more recent
acquisitions, or specific local businesses. In total, we identified 15 components across the Group.
Our Group audit was scoped by obtaining an understanding of the Group and its environment,
including Group-wide controls, and assessing the risks of material misstatement at the Group level.
The identification of significant accounts, including the identification and classification of risks of material
misstatement was performed by the Group audit team, including scoping of relevant IT systems and
controls relevant to the audit. The concentration of activity and controllership in the Group, including the
centralisation of the finance function in the Group’s Head Office and Shared Business Service Centres,
enabled us to structure the audit more centrally with the majority of the audit work performed by the
Group audit team in the UK.
RS Group plc Annual Report and Accounts 2025 141STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
We have focused our audit procedures on five components being the EMEA, APAC and Americas
divisions, Risoul in Mexico and the Group head office entities. In addition, audit procedures were
performed on specific account balances at other components. These components represent the
principal business units and account for 89% of the Group’s revenue, 88% of the Group’s profit before
tax and 96% of the Group’s total assets. They were also selected to provide an appropriate basis for
undertaking audit work to address the risks of material misstatement identified above. The predecessor
auditor identified components as individual country units. Nine in-scope components were identified for
audits of specified balances. These components accounted for 71% of the Group’s revenue and 72% of
the Group’s adjusted profit before tax in the prior period.
Audit work performed at Global Shared Business Service Centres and other components
A significant amount of the Group’s operational processes which cover financial reporting are
undertaken at the Group’s Shared Business Service Centres. The common IT systems in the GSBS
centres, together with our data analytical tools, allowed us to scrutinise large transactional data sets for
unusual trends, characteristics, outliers or transaction flows to support our identification of audit risks
and perform the audit work of the related balances centrally without the need to engage component
auditors. The Group audit team therefore performed the audit work at the GSBS centres located in Corby
(UK), Fort Worth (US) and Foshan (China) where balances were in scope for the Group audit.
Audit work was further performed at other components centrally by the Group team on specific balances
or classes of transactions.
The audit of Risoul was performed locally in Mexico by a component audit team. Component teams were
also engaged to perform specified procedures relating to cash and cash equivalents and the existence
of inventory at specific components.
Procedures performed at the GSBS centres and other components were performed applying
component performance materiality in a range of £2.7m to £5.4m.
Further details of how we exercised direction, supervision and review over component audit teams are
set out in section 7.4 below. Inventory counts were performed by local country Deloitte audit teams all of
whom received a briefing by the Group audit team prior to attending the count. Where within the scope
of our audit, all inventory counts were attended in person.
11%
89%
Revenue
12%
88%
Proﬁt
before tax
4%
96%
Total assets
Specified audit procedures Reviews at Group level
Independent auditor’s report to the members of RS Group plc continued
Audit procedures undertaken at a Group level and on the Company
We performed audit work on the Head Office function, at the Group level. Further, we performed audit
work at Group and on the Company financial statements, including but not limited to the consolidation
of the Group’s results, the preparation of the financial statements, certain disclosures within the
Directors’ Remuneration Report, share-based payments, treasury, defined benefit pension schemes,
going concern, goodwill impairment and litigation provisions. Audit procedures undertaken at a Group
level relating to Head Office were performed to Group materiality, or Company materiality where the
procedures related to the Company. In addition, we carried out reviews at a Group level to confirm our
conclusion that there were no significant risks of material misstatement of the aggregated financial
information of the remaining components not subject to audit or audit of specified account balances.
7.2 Our consideration of the control environment
The Group’s operations utilise a range of information systems which underpin the financial reporting
process. We identified the main finance systems used in the GSBS locations, the Group consolidation
system and inventory management systems at key inventory locations as the key IT systems relevant
to our audit. With the assistance of our IT specialist, we also obtained an understanding of and tested
relevant controls relating to these key systems used to process transactions, manage inventory and
to consolidate the financial results of the Group. We have relied on IT controls in the EMEA and APAC
GSBS locations.
In addition, we obtained an understanding of the Group’s control environment performing process and
controls walkthroughs on key business cycles including but not limited to order-to-cash, purchase-to-
pay, inventory management and provisioning, the financial close and reporting process, and other head
office and relevant areas.
As set out on page 98 of the Audit Committee Report, management has commenced a programme to
improve and build upon its existing controls framework, including to standardise controls across the
Group. This is expected to be a multi-year project, ahead of Provision 29 of the updated UK Corporate
Governance Code 2024 becoming applicable for the Group in 2027. Other than the reliance on IT
controls as set out above, we have performed a fully substantive audit. We plan to update our controls
reliance strategy as this project progresses.
7.3 Our consideration of climate-related risks
In planning our audit, we have considered the potential impact of climate change on the Group’s
businesses and its financial statements.
The Group has assessed the risk and opportunities relevant to climate change, and the Group’s
Principal Risks capture physical and transitional climate-related risks as determined in the Enterprise
Risk Management Process. The risks have also been considered and embedded into the businesses, as
explained in the Strategic Report on page 36.
As part of our audit procedures, we have obtained management’s climate-related risk assessment
and held discussions to understand the process of identifying climate-related risks, the determination
of mitigating actions and the impact on the Group’s financial statements. While management has
acknowledged the risks and opportunities posed by climate change, they have assessed that climate
change does not create any specific key sources of estimation uncertainty in the financial statements as
at 31 March 2025, as explained in Note 1 to the accounts.
RS Group plc Annual Report and Accounts 2025142
We performed our own qualitative risk assessment of the potential impact of climate change on the
Group’s account balances and classes of transactions, with particular focus on areas of judgement such
as inventory provisioning, the forecasting assumptions used in going concern and goodwill impairment
testing, and did not identify any additional risks of material misstatement. Our risk assessment and wider
procedures were performed with the involvement of our ESG Centre of Excellence and included reading
disclosures in the Strategic Report to consider whether they are materially consistent with the financial
statements and our knowledge obtained in the audit. We have not been engaged to provide assurance
over the accuracy of these disclosures.
7.4 Working with other auditors
The Group audit team are responsible for the scope and direction of the audit process. As set out
in section 7.1, we engaged a component auditor based in Mexico to assist with the audit of specific
balances and classes of transactions relating to the Risoul trading entity.
In exercising appropriate direction, supervision and review activities over the component auditor, the
Group team:
– Selected the key Mexican component audit partner and their team ahead of our first year as
Group auditor;
– Provided detailed referral instructions setting out the procedures to be performed;
– Engaged in regular communication with the component auditor, enabling timely reporting and
challenge of outcomes across the Group and component audit, including visiting the local team in
Mexico and meeting local management during the year-end period; and
– Performed virtual file reviews over higher and significant risk areas of the audit so that the work
performed was in line with our referral instructions and challenged the appropriateness of the
conclusions reached on key judgement areas.
We also directed and supervised other component auditors in the performance of specific procedures
relating to cash and cash equivalents and the existence of inventory. We issued detailed instructions to
the component audit teams on the procedures to be performed. We reviewed all work or deliverables
performed by each component team to support the Group audit opinion.
In addition, our component audit teams attended a two day in person planning meeting in June 2024
held prior to commencement of our detailed audit work. In addition, they also attended an update
meeting (held virtually) in January 2025. Both of these sessions were led by the Group audit team.
These meetings enabled a good level of understanding of the Group’s businesses, its core strategy and
a thorough discussion of the significant risks and our planned audit approach. Group management also
attended part of the meetings in June to support these planning activities.
8. Other information
The other information comprises the information included in the annual report, other than the financial
statements and our auditor’s report thereon. The Directors are responsible for the other information
contained within the annual report.
Our opinion on the financial statements does not cover the other information and, except to the extent
otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other
information is materially inconsistent with the financial statements, or our knowledge obtained in the
course of the audit, or otherwise appears to be materially misstated.
If we identify such material inconsistencies or apparent material misstatements, we are required to
determine whether this gives rise to a material misstatement in the financial statements themselves. If,
based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact.
We have nothing to report in this regard.
9. Responsibilities of Directors
As explained more fully in the directors’ responsibilities statement, the Directors are responsible for the
preparation of the financial statements and for being satisfied that they give a true and fair view, and
for such internal control as the Directors determine is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are responsible for assessing the Group’s and the
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.
10. Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report
that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on
the FRC’s website at: frc.org.uk/auditorsresponsibilities. This description forms part of our
auditor’s report.
RS Group plc Annual Report and Accounts 2025 143STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
11. Extent to which the audit was considered capable of detecting
irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above, to detect material misstatements in
respect of irregularities, including fraud. The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below.
11.1 Identifying and assessing potential risks related to irregularities
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud
and non-compliance with laws and regulations, we considered the following:
– the nature of the industry and sector, control environment and business performance including the
design of the Group’s remuneration policies, key drivers for Directors’ remuneration, bonus levels and
performance targets;
– results of our enquiries of management, operational audit, the Directors and the audit committee
about their own identification and assessment of the risks of irregularities, including those that are
specific to the Group’s sector;
– any matters we identified having obtained and reviewed the Group’s documentation of their policies
and procedures relating to:
– identifying, evaluating and complying with laws and regulations and whether they were aware of
any instances of non-compliance;
– detecting and responding to the risks of fraud and whether they have knowledge of any actual,
suspected or alleged fraud;
– the internal controls established to mitigate risks of fraud or non-compliance with laws and
regulations; and
– the matters discussed among the audit engagement team, including the component audit team
and relevant internal specialists, including tax, valuations, financial instruments, actuarial, pensions,
data analytics, IT, and ESG specialists regarding how and where fraud might occur in the financial
statements and any potential indicators of fraud.
As a result of these procedures, we considered the opportunities and incentives that may exist within the
organisation for fraud and identified the greatest potential for fraud relating to inventory obsolescence
provisioning. In common with all audits under ISAs (UK), we are also required to perform specific
procedures to respond to the risk of management override.
We also obtained an understanding of the legal and regulatory frameworks that the Group operates
in, focusing on provisions of those laws and regulations that had a direct effect on the determination
of material amounts and disclosures in the financial statements. The key laws and regulations we
considered in this context included the regulations from the UK Companies Act 2006, the UK Listing
Rules, pensions legislation, and tax legislation.
In addition, we considered provisions of other laws and regulations that do not have a direct effect on
the financial statements but compliance with which may be fundamental to the Group’s ability to operate
or to avoid a material penalty. These included environmental regulations relevant to the Group.
11.2 Audit response to risks identified
As a result of performing the above, we identified the valuation of the inventory obsolescence provision
as a key audit matter related to the potential risk of fraud. The key audit matters section of our report
explains the matter in more detail and also describes the specific procedures we performed in response
to that key audit matter.
In addition to the above, our procedures to respond to risks identified included the following:
– reviewing the financial statement disclosures and testing to supporting documentation to assess
compliance with provisions of relevant laws and regulations described as having a direct effect on the
financial statements;
– enquiring of management, the Audit Committee and in-house and external legal counsel concerning
actual and potential litigation and claims;
– performing analytical procedures to identify any unusual or unexpected relationships that may
indicate risks of material misstatement due to fraud;
– reading minutes of meetings of those charged with governance, reviewing internal audit reports, and
reviewing correspondence with HMRC the regulator; and
– in addressing the risk of fraud through management override of controls, testing the appropriateness
of journal entries and other adjustments; assessing whether the judgements made in making
accounting estimates are indicative of a potential bias; and evaluating the business rationale of any
significant transactions that are unusual or outside the normal course of business.
We also communicated relevant identified laws and regulations and potential fraud risks to all
engagement team members, including internal specialists and the component audit teams, and
remained alert to any indications of fraud or non-compliance with laws and regulations throughout
the audit.
Report on other legal and regulatory requirements
12. Opinions on other matters prescribed by the Companies Act 2006
In our opinion the part of the Directors’ remuneration report to be audited has been properly
prepared in accordance with the Companies Act 2006.
In our opinion, based on the work undertaken in the course of the audit:
– the information given in the strategic report and the Directors’ report for the financial year for
which the financial statements are prepared is consistent with the financial statements; and
– the strategic report and the Directors’ report have been prepared in accordance with applicable
legal requirements.
In the light of the knowledge and understanding of the Group and the Company and their
environment obtained in the course of the audit, we have not identified any material misstatements
in the strategic report or the Directors’ report.
Independent auditor’s report to the members of RS Group plc continued
RS Group plc Annual Report and Accounts 2025144
13. Corporate Governance Statement
The Listing Rules require us to review the Directors’ statement in relation to going concern, longer-term
viability and that part of the Corporate Governance Statement relating to the Group’s compliance with
the provisions of the UK Corporate Governance Code specified for our review.
Based on the work undertaken as part of our audit, we have concluded that each of the following
elements of the Corporate Governance Statement is materially consistent with the financial
statements and our knowledge obtained during the audit:
– the Directors’ statement with regards to the appropriateness of adopting the going concern basis
of accounting and any material uncertainties identified set out on page 44;
– the Directors’ explanation as to their assessment of the Group’s prospects, the period this
assessment covers and why the period is appropriate set out on page 43;
– the Directors’ statement on fair, balanced and understandable set out on page 98;
– the Board’s confirmation that it has carried out a robust assessment of the emerging and
principal risks set out on page 38;
– the section of the annual report that describes the review of effectiveness of risk management
and internal control systems set out on page 100; and
– the section describing the work of the Audit Committee set out on page 97.
14. Matters on which we are required to report by exception
14.1 Adequacy of explanations received and accounting records
Under the Companies Act 2006 we are required to report to you if, in our opinion:
– we have not received all the information and explanations we require for our audit; or
– adequate accounting records have not been kept by the Company, or returns adequate for our audit
have not been received from branches not visited by us; or
– the Company financial statements are not in agreement with the accounting records and returns.
We have nothing to report in respect of these matters.
14.2 Directors’ remuneration
Under the Companies Act 2006 we are also required to report if in our opinion certain disclosures of
Directors’ remuneration have not been made or the part of the Directors’ remuneration report to be
audited is not in agreement with the accounting records and returns.
We have nothing to report in respect of these matters.
15. Other matters which we are required to address
15.1 Auditor tenure
Following the recommendation of the Audit Committee, we were appointed by the shareholders
at the Annual General Meeting on 11 July 2024 to audit the financial statements for the year ending
31 March 2025 and subsequent financial periods. The period of total uninterrupted engagement
including previous renewals and reappointments of the firm is therefore one year.
15.2 Consistency of the audit report with the additional report to the audit committee
Our audit opinion is consistent with the additional report to the Audit Committee we are required to
provide in accordance with ISAs (UK).
16. Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part
16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the
Company’s members those matters we are required to state to them in an auditor’s report and for no
other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to
anyone other than the Company and the Company’s members as a body, for our audit work, for this
report, or for the opinions we have formed.
As required by the Financial Conduct Authority (FCA) Disclosure Guidance and Transparency Rule (DTR)
4.1.15R – DTR 4.1.18R, these financial statements will form part of the Electronic Format Annual Financial
Report filed on the National Storage Mechanism of the FCA in accordance with DTR 4.1.15R – DTR
4.1.18R. This auditor’s report provides no assurance over whether the Electronic Format Annual Financial
Report has been prepared in compliance with DTR 4.1.15R – DTR 4.1.18R.
Jon Thomson FCA (Senior Statutory Auditor)
For and on behalf of Deloitte LLP
Statutory Auditor
London, United Kingdom
20 May 2025
RS Group plc Annual Report and Accounts 2025 145STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Notes
2025
£m
2024
restated
1
£m
Profit for the year 152.6 179.4
Other comprehensive income/(expense)
Items that will not be reclassified subsequently to the income
statement
Remeasurement of retirement benefit obligations 10 1.5 0.8
Related income tax 11 (0.3) (0.1)
1.2 0.7
Items that may be reclassified subsequently to the income
statement
Foreign exchange translation differences of joint venture 17 (0.1) (0.2)
Foreign exchange translation differences (84.1) (3.6)
Fair value gain on net investment hedges 27 6.6 3.4
Movement in cash flow hedges 27 1.4 (0.1)
Related income tax 11 (0.2) –
(76.4) (0.5)
Other comprehensive (expense)/income for the year (75.2) 0.2
Total comprehensive income for the year 77.4 179.6
Total comprehensive income is attributable to:
Owners of the Company 77.5 179.7
Non-controlling interests (0.1) (0.1)
77.4 179.6
1. Please refer to Note 32 for further details of the restatement.
The Notes on pages 150 to 195 form part of these Group accounts.
GROUP INCOME STATEMENT
For the year ended 31 March 2025
GROUP STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 March 2025
Group accounts
Notes
2025
£m
2024
restated
1
£m
Revenue 2,3,4 2,903.5 2,942.4
Cost of sales 5 (1,660.3) (1,684.1)
Gross profit 1,243.2 1,258.3
Operating costs (1,010.4) (983.8)
Operating profit 2,3,6 232.8 274.5
Finance income 7 4.7 4.8
Finance costs 7 (32.0) (36.7)
Share of profit of joint venture 17 0.6 0.6
Profit before tax 206.1 243.2
Income tax expense 11 (53.5) (63.8)
Profit for the year attributable to owners of the Company 152.6 179.4
Earnings per share attributable to owners of the Company
Basic 12 32.5p 37.9p
Diluted 12 32.5p 37.8p
1. Please refer to Note 32 for further details of the restatement.
The Notes on pages 150 to 195 form part of these Group accounts.
RS Group plc Annual Report and Accounts 2025146
Notes
2025
£m
2024
restated
1
£m
2023
restated
1
£m
Non-current liabilities
Other payables 20 (7.4) (17.3) (9.3)
Retirement benefit obligations 10 (16.4) (27.2) (37.2)
Borrowings 22 (390.0) (440.3) (184.6)
Lease liabilities 16,22 (41.2) (57.9) (34.3)
Provisions 24 (3.1) (4.2) (4.7)
Deferred tax liabilities 11 (91.6) (98.7) (86.9)
Total non-current liabilities (549.7) (645.6) (357.0)
Total liabilities (1,266.1) (1,460.9) (1,195.9)
Net assets 1,354.5 1,418.9 1,334.9
Equity
Share capital and share premium 26 287.1 286.9 283.3
Own shares held by Employee Benefit Trust (EBT) 26 (42.3) (1.8) (2.2)
Other reserves 27 32.0 108.9 109.1
Retained earnings 1,077.2 1,024.3 944.0
Equity attributable to owners of the Company 1,354.0 1,418.3 1,334.2
Non-controlling interests 0.5 0.6 0.7
Total equity 1,354.5 1,418.9 1,334.9
1. Please refer to Note 32 for further details of the restatement.
The Notes on pages 150 to 195 form part of these Group accounts.
The financial statements of RS Group plc were approved by the Board of Directors and authorised for
issue on 20 May 2025. They were signed on its behalf by:
Kate Ringrose
Chief Financial Officer
Notes
2025
£m
2024
restated
1
£m
2023
restated
1
£m
Non-current assets
Intangible assets 14 898.9 982.6 704.8
Property, plant and equipment 15 176.7 180.9 186.3
Right-of-use assets 16 54.3 72.8 46.9
Investment in joint venture 17 1.2 1.3 1.5
Other receivables 19 4.6 8.4 6.5
Retirement benefit net assets 10 2.5 1.5 0.8
Deferred tax assets 11 11.1 9.5 6.9
Total non-current assets 1,149.3 1,257.0 953.7
Current assets
Inventories 18 617.3 637.4 603.1
Trade and other receivables 19 688.5 701.4 692.0
Cash and cash equivalents – cash and short-term deposits 22 147.7 258.7 260.3
Derivative assets 21 1.9 2.6 1.8
Current income tax receivables 15.9 22.7 19.9
Total current assets 1,471.3 1,622.8 1,577.1
Total assets 2,620.6 2,879.8 2,530.8
Current liabilities
Trade and other payables 20 (611.0) (602.7) (658.9)
Cash and cash equivalents – bank overdrafts 22 (41.7) (162.7) (139.8)
Borrowings 22 (23.5) – –
Lease liabilities 16,22 (15.5) (16.0) (14.6)
Derivative liabilities 21 (1.8) (1.1) (1.7)
Provisions 24 (5.0) (5.0) (1.8)
Current income tax liabilities (17.9) (27.8) (22.1)
Total current liabilities (716.4) (815.3) (838.9)
GROUP BALANCE SHEET
As at 31 March 2025
Company number: 647788
RS Group plc Annual Report and Accounts 2025 147STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Group accounts continued
Notes
2025
£m
2024
restated
1
£m
Cash flows from investing activities
Acquisition of businesses 29 (8.4) (313.1)
Cash and cash equivalents acquired with businesses 29 – 9.0
Total cash impact on acquisition of businesses (8.4) (304.1)
Purchase of intangible assets (33.1) (35.7)
Purchase of property, plant and equipment (16.2) (15.9)
Net cash used in investing activities (57.7) (355.7)
Cash flows from financing activities
Proceeds from the issue of share capital 26 0.2 3.6
Purchase of own shares by EBT (46.5) (1.5)
Net (decrease)/increase in revolving facility and short-term loans
2
(42.3) 130.2
Other loans drawn down
2
24.0 131.7
Other loans repaid
2
(0.4) (2.5)
Principal elements of lease payments (15.7) (18.5)
Dividends paid 13 (104.7) (104.1)
Net cash (used in)/generated from financing activities (185.4) 138.9
Net increase/(decrease) in cash and cash equivalents 16.0 (20.2)
Cash and cash equivalents at the beginning of the year 96.0 120.5
Effect of exchange rate changes (6.0) (4.3)
Cash and cash equivalents at the end of the year 22 106.0 96.0
1. Please refer to Note 32 for further details of the restatement.
2. Cash flows relating to borrowings eligible for net presentation are now presented within the line “net (decrease)/increase in revolving
facility and short-term loans”. The 2023/24 comparative of £130.2 million consists of inflow of £155.0 million re-presented from “other
loans drawn down” and outflow of £24.8 million re-presented from “other loans repaid”.
The Notes on pages 150 to 195 form part of these Group accounts.
Notes
2025
£m
2024
restated
1
£m
Cash flows from operating activities
Profit before tax 206.1 243.2
Depreciation and amortisation 6 85.4 83.7
Impairment of intangible assets 14 12.8 4.6
Impairment of property, plant and equipment 15 0.4 –
Impairment of right-of-use assets – 0.4
Loss on disposal of non-current assets 6 0.1 1.6
Equity-settled share-based payments 8,9 9.9 7.8
Net finance costs 27.3 31.9
Decrease in inventories 7.6 10.5
(Increase)/decrease in trade and other receivables (2.0) 8.1
Increase/(decrease) in trade and other payables 12.3 (82.2)
(Decrease)/increase in provisions (0.4) 1.1
Defined benefit retirement contributions in excess of charge (10.7) (9.8)
Cash generated from operations 348.8 300.9
Interest received 4.7 4.8
Interest paid (34.0) (35.8)
Income tax paid (60.4) (73.3)
Net cash from operating activities 259.1 196.6
GROUP CASH FLOW STATEMENT
For the year ended 31 March 2025
RS Group plc Annual Report and Accounts 2025148
Attributable to owners of the Company
Share capital and share
premium (Note 26)
£m
Own shares held
by EBT
£m
Other reserves
(Note 27)
£m
Retained
earnings
£m
Total
£m
Non-controlling
interests
£m
Total equity
£m
At 1 April 2023 (as reported) 283.3 (2.2) 108.8 954.3 1,344.2 0.7 1,344.9
Effect of prior period restatement (Note 32) – – 0.3 (10.3) (10.0) – (10.0)
As at April 2023 (restated
1
) 283.3 (2.2) 109.1 944.0 1,334.2 0.7 1,334.9
Profit for the year (as reported) – – – 183.7 183.7 – 183.7
Prior period restatement (Note 32) – – – (4.3) (4.3) – (4.3)
Profit for the year (restated
1
) – – – 179.4 179.4 – 179.4
Other comprehensive income/(expense) (as reported) – – (0.7) 0.7 – (0.1) (0.1)
Prior period restatement (Note 32) – – 0.3 – 0.3 – 0.3
Other comprehensive income/(expense) (restated
1
) – – (0.4) 0.7 0.3 (0.1) 0.2
Total comprehensive income/(expense) (restated
1
) – – (0.4) 180.1 179.7 (0.1) 179.6
Cash flow hedging gains transferred to inventories – – (1.6) – (1.6) – (1.6)
Cash flow hedging losses transferred to acquisition purchase price – – 1.8 – 1.8 – 1.8
Dividends (Note 13) – – – (104.1) (104.1) – (104.1)
Equity-settled share-based payments (Notes 8 and 9) – – – 7.8 7.8 – 7.8
Settlement of share awards 3.6 1.9 – (1.9) 3.6 – 3.6
Purchase of own shares by EBT – (1.5) – – (1.5) – (1.5)
Tax on equity-settled share-based payments – – – (1.6) (1.6) – (1.6)
At 31 March 2024 (restated
1
) 286.9 (1.8) 108.9 1,024.3 1,418.3 0.6 1,418.9
Profit for the year – – – 152.7 152.7 (0.1) 152.6
Other comprehensive income/(expense) – – (76.4) 1.2 (75.2) – (75.2)
Total comprehensive income/(expense) – – (76.4) 153.9 77.5 (0.1) 77.4
Cash flow hedging gains transferred to inventories – – (0.6) – (0.6) – (0.6)
Tax on cash flow hedging transferred to inventories – – 0.1 – 0.1 – 0.1
Dividends (Note 13) – – – (104.7) (104.7) – (104.7)
Equity-settled share-based payments (Notes 8 and 9) – – – 9.4 9.4 – 9.4
Settlement of share awards 0.2 6.0 – (5.5) 0.7 – 0.7
Purchase of own shares by EBT – (46.5) – – (46.5) – (46.5)
Tax on equity-settled share-based payments – – – (0.2) (0.2) – (0.2)
At 31 March 2025 287.1 (42.3) 32.0 1,077.2 1,354.0 0.5 1,354.5
1. Please refer to Note 32 for further details of the restatement.
The Notes on pages 150 to 195 form part of these Group accounts.
GROUP STATEMENT OF CHANGES IN EQUITY
For the year ended 31 March 2025
RS Group plc Annual Report and Accounts 2025 149STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Group accounts continued
1 Basis of preparation
RS Group plc (the Company) is a public limited company registered in England and Wales and listed on
the London Stock Exchange.
The Group accounts for the year ended 31 March 2025 are presented in sterling and rounded to
£0.1 million. They are prepared in accordance with UK-adopted international accounting standards (UK
IAS) and the requirements of the Companies Act 2006.
The Group accounts have been prepared on a going concern basis under the historical cost convention,
modified by the revaluation of retirement benefit obligations and certain financial assets and liabilities
(including derivative financial instruments) as explained in the relevant notes. The principal accounting
policies have been applied consistently unless otherwise stated.
In adopting the going concern basis for preparing these Group accounts, the Board has considered
the Group’s future trading prospects; the Group’s available liquidity, the maturity of its debt facilities and
obligations under its debt covenants, and the Group’s principal risks.
We have undertaken reverse stress tests on the latest forecast to assess the circumstances that would
threaten the Group’s current financing arrangements. These included significant declines in revenue,
significant declines in revenue and gross margin, a major deterioration in cash collection, and a major
under-performing acquisitions. These reverse stress tests assumed that capital expenditure and
operating costs are unchanged from those in the forecast, no significant working capital initiatives occur
in mitigation, dividends continue to be paid and there are no changes in or extensions to debt financing.
Based on the assessment outlined above and the output of our detailed rolling forecasts, the
Board believes that it is appropriate to continue to adopt the going concern basis in preparing the
Group’s accounts.
Basis of consolidation
The Group accounts comprise the results, assets and liabilities of the Company and all its subsidiaries
(together referred to as the Group) and include the Employee Benefit Trust (EBT) and the Group’s
interest in a joint venture. Subsidiaries are entities controlled by the Company and the EBT is controlled
by the Company. The joint venture is accounted for using the equity method of accounting.
The results of businesses acquired in the year are consolidated from the effective date of acquisition.
The net assets of businesses acquired are incorporated in the Group accounts at their fair values at the
date of acquisition.
Intra-group transactions and balances are eliminated in preparing the Group accounts and no profit or
loss is recognised on intra-group transactions. Unrealised gains or losses arising from transactions with
the joint venture are eliminated to the extent of the Group’s interest in the entity.
Estimates and judgements
The preparation of accounts in accordance with UK IAS requires the Group to make judgements and
estimates that affect the application of accounting policies and reported amounts of assets and liabilities,
income and expenses. Except for judgements involved in estimations, no judgements have been
made in the process of applying the Group’s accounting policies that have had a significant effect on
the amounts recognised in the accounts. The judgements involved in estimations take account of the
Group’s latest expectations of the longer-term impacts of climate change and environmental regulations
and the current global economic and geopolitical uncertainties, and the impact was not material.
Significant estimates are those that have a significant risk of resulting in a material adjustment to the
carrying amounts of the Group’s assets and liabilities within the next year. The significant estimates
made in preparing the accounts were in relation to retirement benefit obligations and inventory
provisioning and further details on the application of these estimates can be found in Note 10 and Note
18 respectively. While not significant estimates, the Group also focuses on estimates made in relation to
the fair values on acquisition of businesses (Note 29) and the review of intangibles and other assets for
impairment (Notes 14 and 23). Further details are provided in the relevant notes.
Actual results in the longer term may differ from these estimates.
Foreign currency
Foreign currency transactions
Transactions in foreign currencies are recorded using the rate ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are
retranslated at the rate ruling at that date and the gains and losses on translation are recognised in
operating profit. Non-monetary assets and liabilities that are measured in terms of historical cost in a
foreign currency are translated using the rate at the date of the transaction. Non-monetary assets and
liabilities denominated in foreign currencies that are stated at fair value are translated at the rate ruling
at the date the fair value was determined.
Translation of foreign operations
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on
acquisition, are translated at exchange rates ruling at the balance sheet date. The income statement
and cash flows of foreign operations are translated at the average rate for the period. Foreign exchange
differences on translation of foreign operations are recognised in other comprehensive income.
Standards and interpretations adopted in the year
Amendments to IAS 7 ‘Statement of Cash Flows’ and IFRS 7 ‘Financial Instruments: Disclosures’ titled
‘Supplier Finance Arrangements’
The amendments to IAS 7 ‘Statement of Cash Flows’ and International Financial Reporting Standard
(IFRS) 7 ‘Financial Instruments: Disclosures’ titled ‘Supplier Finance Arrangements’ introduce new
disclosure requirements that enables users of financial statements to assess the effects of supplier
finance arrangements on the Group’s liabilities, cash flows and exposure to concentration of liquidity risk.
NOTES TO THE GROUP ACCOUNTS
For the year ended 31 March 2025
RS Group plc Annual Report and Accounts 2025150
The Group applied transitional provisions contained in the amendments and hence it did not disclose
the comparative information in the first year of adoption. Note 20 provides the required disclosures
related to these amendments.
Other
Amendments to IAS 1 ‘Classification of Liabilities as Current or Non-current’ and ‘Presentation of Financial
Statements – Non-current Liabilities with Covenants’, and Amendments to IFRS 16 “Leases – Lease
Liability in a Sale and Leaseback” were adopted in the year. There was no material impact on the reported
results or financial position of the Group.
Standards or interpretations issued but not yet applied
The Group does not consider that the following standards or interpretations issued but not yet effective,
and in some cases not yet adopted by the UK Endorsement Board (UKEB), will have a significant impact
on the accounts, except if indicated below.
Amendments to IAS 21 ‘The Effects of Changes in Foreign Exchange Rates’ titled ‘Lack of Exchangeability’
effective for annual reporting periods beginning on or after 1 January 2025.
Amendments to IFRS 9 ‘Financial Instruments’ and IFRS 7 ‘Financial Instruments: Disclosures’ titled
‘Amendments to the Classification and Measurement of Financial Instruments’ effective for annual
reporting periods beginning on or after 1 January 2026. The potential impact on cash and banking
operations and amounts reported in cash and cash equivalents on adoption of the amendments is
currently being assessed.
Amendments to IFRS 9 ‘Financial Instruments’ and IFRS 7 ‘Financial Instruments: Disclosures’ titled
‘Contracts Referencing Nature-dependent Electricity’ effective for annual reporting periods beginning on
or after 1 January 2026.
IFRS 19 ‘Subsidiaries without Public Accountability: Disclosures’, not yet endorsed for adoption in
UK IAS, effective for annual reporting periods beginning on or after 1 January 2027 with earlier
application permitted.
IFRS 18 ‘Presentation and Disclosures in Financial Statements’ effective for annual reporting periods
beginning on or after 1 January 2027 with earlier application permitted. The Group anticipates that
the application of these amendments may have an impact on the Group’s consolidated accounts in
future periods.
IFRS 18 replaces IAS 1, carrying forward many of the requirements in IAS 1 unchanged and
complementing them with new requirements. In addition, some IAS 1 paragraphs have been moved
to IAS 8 and IFRS 7. Furthermore, the IASB has made minor amendments to IAS 7 and IAS 33 Earnings
per Share.
IFRS 18 introduces new requirements to:
– present specified categories and defined subtotals in the income statement
– provide disclosures on management-defined performance measures (MPMs) in the notes to
the accounts
– improve aggregation and disaggregation
The amendments to IAS 7 and IAS 33, as well as the revised IAS 8 and IFRS 7, become effective when an
entity applies IFRS 18. IFRS 18 requires retrospective application with specific transition provisions.
2 Segmental reporting
The Group’s operating segments comprise three regions: EMEA, Americas and Asia Pacific.
Their principal activities are described on pages 33 to 35. The operating segments’ performance is
assessed on revenue and adjusted operating profit on a monthly basis by the chief operating decision
maker, who is the Chief Executive Officer. Inter-segment pricing is determined on an arm’s length
basis, comprising sales of product at cost and a handling charge included within distribution and
marketing expenses.
During the first half of the year the Group reviewed the methodology for the allocation of central costs
which has resulted in an increased level of costs apportioned to the regions and a lower level of central
costs, and the prior years’ segmental operating profits and central costs have been restated below.
The level of costs reallocated from/(to) central costs to/(from) the regions as a result of the change was
£37.7 million (EMEA: £32.3 million; Americas: £6.6 million; partially offset by Asia Pacific: (£1.2 million)) in
the year ended 31 March 2024 and £36.0 million (EMEA: £28.1 million; Americas: £8.9 million; partially
offset by Asia Pacific: (£1.0 million)) in the year ended 31 March 2023.
Due to a prior period error, there is an additional restatement of prior years. Further details can be found
in Note 32.
RS Group plc Annual Report and Accounts 2025 151STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Year ended 31 March 2024 (restated)
EMEA
£m
Americas
£m
Asia Pacific
£m
Group
£m
Revenue from external customers 1,794.8 933.7 213.9 2,942.4
Segmental operating profit 223.4 89.2 5.0 317.6
Central costs (11.4)
Adjusted operating profit
1
306.2
Amortisation of acquired intangibles (26.6)
Acquisition-related items (Note 3) (5.1)
Operating profit 274.5
Net finance costs (31.9)
Share of profit of joint venture 0.6
Profit before tax 243.2
Segmental capital expenditure 38.3 12.5 0.4 51.2
Central costs –
Capital expenditure 51.2
Segmental depreciation and amortisation 38.8 14.2 2.7 55.7
Central costs 1.4
Amortisation of acquired intangibles 26.6
Depreciation and amortisation
(including of right-of-use assets)
83.7
1. See Note 3 for definition of this APM.
2 Segmental reporting continued
Year ended 31 March 2025
EMEA
£m
Americas
£m
Asia Pacific
£m
Group
£m
Revenue from external customers 1,777.3 907.4 218.8 2,903.5
Segmental operating profit 200.5 81.6 6.1 288.2
Central costs (14.0)
Adjusted operating profit
1
274.2
Amortisation and impairment of acquired intangibles (37.3)
Acquisition-related items (Note 3) (4.1)
Operating profit 232.8
Net finance costs (27.3)
Share of profit of joint venture 0.6
Profit before tax 206.1
Segmental capital expenditure 38.2 9.9 0.8 48.9
Central costs –
Capital expenditure 48.9
Segmental depreciation and amortisation 41.7 13.1 3.2 58.0
Central costs 1.4
Amortisation of acquired intangibles 26.0
Depreciation and amortisation
(including of right-of-use assets)
85.4
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
RS Group plc Annual Report and Accounts 2025152
Disaggregation of revenue
In the tables below, revenue is disaggregated by sales channels, by own-brand products or other
product and service solutions, and also by service solutions or other. Service solutions includes
procurement solutions, maintenance solutions and other solutions. The Group’s largest own brand
is RS PRO. £2,805.2 million of revenue is recognised at a point in time (2023/24: £2,850.7 million) and
£98.3 million over time (2023/24: £91.7 million).
Sales channel
During the year the Group reviewed what it classes as digital revenue which has resulted in an overall
increase to digital revenue and corresponding decrease to offline revenue in EMEA for the year ended
31 March 2024 of £18.4 million (2022/23: £nil), and in Americas a decrease in digital revenue and a
corresponding increase in offline revenue of £18.5 million (2022/23: £4.2 million). The Group has also
reviewed its categorisation of service solutions revenue, which has resulted in a decrease in service
solutions revenue in Americas of £11.2 million in the year ended 31 March 2024 (2022/23: £3.9 million).
The information below reflects the new classifications.
Year ended 31 March 2025
EMEA
£m
Americas
£m
Asia Pacific
£m
Group
£m
Web 851.2 269.5 81.9 1,202.6
eProcurement and other digital 479.1 35.7 36.5 551.3
Digital 1,330.3 305.2 118.4 1,753.9
Offline 447.0 602.2 100.4 1,149.6
Revenue 1,777.3 907.4 218.8 2,903.5
Year ended 31 March 2024 (restated)
EMEA
£m
Americas
£m
Asia Pacific
£m
Group
£m
Web 881.1 281.6 88.5 1,251.2
eProcurement and other digital 459.6 36.1 34.6 530.3
Digital 1,340.7 317.7 123.1 1,781.5
Offline 454.1 616.0 90.8 1,160.9
Revenue 1,794.8 933.7 213.9 2,942.4
Year ended 31 March 2023 (restated)
Web 893.8 340.5 121.2 1,355.5
eProcurement and other digital 417.3 60.1 39.6 517.0
Digital 1,311.1 400.6 160.8 1,872.5
Offline 457.4 544.9 107.5 1,109.8
Revenue 1,768.5 945.5 268.3 2,982.3
RS Group plc Annual Report and Accounts 2025 153STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
2 Segmental reporting continued
Own-brand/other products and service solutions
Year ended 31 March 2025
EMEA
£m
Americas
£m
Asia Pacific
£m
Group
£m
Own-brand product and service solutions 359.6 7.1 33.7 400.4
Other product and service solutions 1,417.7 900.3 185.1 2,503.1
Revenue 1,777.3 907.4 218.8 2,903.5
Year ended 31 March 2024
Own-brand product and service solutions 364.9 6.7 33.2 404.8
Other product and service solutions 1,429.9 927.0 180.7 2,537.6
Revenue 1,794.8 933.7 213.9 2,942.4
Service solutions/other
Year ended 31 March 2025
EMEA
£m
Americas
£m
Asia Pacific
£m
Group
£m
Service solutions 557.1 133.7 46.7 737.5
Other 1,220.2 773.7 172.1 2,166.0
Revenue 1,777.3 907.4 218.8 2,903.5
Year ended 31 March 2024 (restated)
Service solutions 532.3 121.6 43.4 697.3
Other 1,262.5 812.1 170.5 2,245.1
Revenue 1,794.8 933.7 213.9 2,942.4
Year ended 31 March 2023 (restated)
Service solutions 506.1 129.0 46.4 681.5
Other 1,262.4 816.5 221.9 2,300.8
Revenue 1,768.5 945.5 268.3 2,982.3
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
Revenue and non-current assets by geographical location
In the table below, revenue is based on the location of the Group operation where the sales originated
and non-current assets are based on the location of the assets. Non-current assets exclude financial
instruments, retirement benefit net assets and deferred tax assets.
Revenue Non-current assets
2025
£m
2024
£m
2025
£m
2024
£m
UK (country of domicile) 669.5 686.1 209.0 218.4
US 671.0 698.3 366.8 381.9
France 331.1 326.2 16.2 13.7
Mexico 197.9 193.2 181.8 238.8
Germany 169.9 189.0 27.5 30.2
Italy 120.1 126.9 5.3 3.4
Switzerland 51.2 44.3 289.5 288.0
Rest of World 692.8 678.4 35.0 63.3
Group 2,903.5 2,942.4 1,131.1 1,237.7
3 Alternative Performance Measures (APMs)
The Group uses a number of APMs in addition to those measures reported in accordance with UK IAS.
Such APMs are not defined terms under UK IAS and are not intended to be a substitute for any UK IAS
measure. The Directors believe that the APMs are important when assessing the financial and operating
performance of the Group. The APMs are used internally for performance analysis and in employee
incentive arrangements, as well as in discussions with the investment analyst community.
The APMs assist with the comparability of information between reporting periods by adjusting for factors
such as fluctuations in foreign exchange rates, number of trading days and items, such as reorganisation
costs, that are substantial in scope and impact and do not form part of operational or management
activities that the Directors would consider when assessing performance. The Directors review on at
least an annual basis the threshold for what is substantial, in the context of the business performance.
The Directors also believe that excluding recent acquisitions, amortisation and impairment of acquired
intangibles and acquisition-related items aids comparison of the performance between reporting
periods and between businesses with similar assets that were internally generated.
Adjusted profit measures
These are the equivalent UK IAS measures adjusted to exclude amortisation and impairment
of intangible assets arising on acquisition of businesses, acquisition-related items, substantial
reorganisation costs, substantial asset write-downs, one-off pension credits or costs, significant tax rate
changes and, where relevant, associated income tax effects. Adjusted profit before tax is a performance
measure for the annual incentive and the all employee Long Term Incentive Plan (LTIP) called the RS YAY!
RS Group plc Annual Report and Accounts 2025154
Award. Adjusted earnings per share is a performance measure for the LTIP and Journey to Greatness
(J2G) LTIP Award. Adjusted operating profit conversion, adjusted operating profit margin and adjusted
earnings per share are financial key performance indicators (KPIs) which are used to measure the
Group’s progress in delivering the successful implementation of its strategy and monitor and drive
its performance.
Year ended 31 March 2025
Operating
profit
£m
Operating
profit
margin
1
%
Operating
profit
conversion
2
%
Profit
before
tax
£m
Profit for
the year
£m
Basic
earnings
per share
p
Diluted
earnings
per share
p
Reported 232.8 8.0% 18.7% 206.1 152.6 32.5p 32.5p
Amortisation and impairment of acquired
intangibles
37.3 37.3 28.0 6.0p 6.0p
Acquisition-related items 4.1 4.1 3.0 0.6p 0.6p
Adjusted 274.2 9.4% 22.1% 247.5 183.6 39.1p 39.1p
Year ended 31 March 2024 restated
3
Reported 274.5 9.3% 21.8% 243.2 179.4 37.9p 37.8p
Amortisation of acquired intangibles 26.6 26.6 19.8 4.2p 4.2p
Acquisition-related items 5.1 5.1 3.8 0.8p 0.8p
Adjusted 306.2 10.4% 24.3% 274.9 203.0 42.9p 42.8p
1. Operating profit margin is operating profit expressed as a percentage of revenue.
2. Operating profit conversion is operating profit expressed as a percentage of gross profit.
3. Please refer to Note 32 for further details of the restatement.
During the year, the customer contracts, relationships and distribution agreements were assessed for
impairment. As a result of that review, the asset related to the acquisition of IESA was fully impaired,
with an impairment cost of £10.9 million. In addition, £0.4 million of software acquired with IESA was
also impaired.
Acquisition-related items comprise transaction costs directly attributable to the acquisition of
businesses, any deferred consideration payments relating to the retention of former owners and key
employees of acquired businesses expensed as remuneration, adjustments to acquisition-related
indemnification assets and the related liabilities that result from events after the acquisition date and
any remeasurements of contingent consideration payable on acquisition of businesses that result from
events after the acquisition date.
2025
£m
2024
£m
Transaction costs – acquisition-related costs incurred in year for acquisitions completed
in year
– (4.7)
Acquisition related legal claim costs (2.1) –
Retention bonuses (1.7) –
Other acquisition-related costs (0.6) (0.8)
Remeasurements of contingent consideration (Note 29) 0.3 0.4
Acquisition-related items (in administrative expenses) (4.1) (5.1)
Adjustments to uncertain tax provisions related to indemnification assets 0.7 1.3
Other associated income tax effects 0.4 –
Acquisition-related items after tax (3.0) (3.8)
Included in acquisition-related items for the year ended 31 March 2025 was £2.1 million in respect of
legal costs for an ongoing dispute.
Included in acquisition-related items for the year ended 31 March 2024 was the release of the
£0.4 million contingent consideration payable on acquisition of domnick hunter-RL (Thailand) Co., Ltd.
given the conditions for payment were not met.
Like-for-like revenue and profit measures
Like-for-like revenue and profit measures are adjusted to exclude the effects of changes in exchange
rates on translation of overseas profits. They exclude acquisitions in the relevant years until they have
been owned for a year, at which point they start to be included in both the current and comparative
years for the same number of months. These measures enable management and investors to track
more easily, and consistently, the performance of the business.
The principal exchange rates applied in preparing the Group accounts and in calculating the following
like-for-like measures are:
2025
Average
2025
Closing
2024
Average
2024
Closing
US dollar 1.276 1.293 1.257 1.264
Euro 1.189 1.198 1.159 1.170
RS Group plc Annual Report and Accounts 2025 155STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
3 Alternative Performance Measures (APMs) continued
Like-for-like revenue change
Like-for-like revenue change is also adjusted to eliminate the impact of differences in trading days
year-on-year. It is calculated by comparing the revenue of the base business for the current year
with the prior year converted at the current year’s average exchange rates and pro-rated for the
same number of trading days as the current year. It is a performance measure for the annual
incentive and a financial KPI.
£m
Revenue for 2024 2,942.4
Effect of exchange rates (65.9)
Effect of trading days 27.5
Revenue for 2024 at 2025 rates and trading days 2,904.0
2025
Group
£m
Less:
acquisitions
owned
< 1 year
£m
2025
base
business
£m
2024
£m
2024 at 2025
rates and
trading days
£m
Like-for-like
change
%
EMEA 1,777.3 41.1 1,736.2 1,794.8 1,788.0 (3)%
Americas 907.4 – 907.4 933.7 905.7 –
Asia Pacific 218.8 8.5 210.3 213.9 210.3 –
Revenue 2,903.5 49.6 2,853.9 2,942.4 2,904.0 (2)%
Gross margin and like-for-like gross margin change
Gross margin is gross profit expressed as a percentage of revenue. Like-for-like change in gross margin
is calculated by taking the difference between gross margin for the base business for the current year
and gross margin for the prior year with reported revenue and reported gross profit converted at the
current year’s average exchange rates.
2025
Group
£m
Less:
acquisitions
owned
< 1 year
£m
2025
base
business
£m
2024
restated
1
£m
2024
restated
1
at
2025 rates
£m
Like-for-like
change
pts
Revenue 2,903.5 49.6 2,853.9 2,942.4 2,876.5
Gross profit 1,243.2 22.5 1,220.7 1,258.3 1,233.2
Gross margin 42.8% 45.4% 42.8% 42.8% 42.9% (0.1) pts
1. Please refer to Note 32 for further details of the restatement.
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
Like-for-like profit change
Like-for-like change in profit is calculated by comparing the base business for the current year with the
prior year converted at the current year’s average exchange rates.
2025
Group
£m
Less:
acquisitions
owned
< 1 year
£m
2025
base
business
£m
2024
restated
1
£m
2024
restated
1
at
2025 rates
£m
Like-for-like
change
%
Segmental operating profit
EMEA 200.5 2.3 198.2 223.4 217.0 (9)%
Americas 81.6 – 81.6 89.2 85.4 (4)%
Asia Pacific 6.1 0.1 6.0 5.0 4.2 43%
Segmental operating profit 288.2 2.4 285.8 317.6 306.6 (7)%
Central costs (14.0) – (14.0) (11.4) (11.4) 23%
Adjusted operating profit 274.2 2.4 271.8 306.2 295.2 (8)%
Adjusted profit before tax 247.5 2.1 245.4 274.9 264.0 (7)%
Adjusted earnings per share 39.1p 0.4p 38.7p 42.9p 41.2p (6)%
Adjusted diluted earnings per share 39.1p 0.5p 38.6p 42.8p
1. Please refer to Notes 2 and 32 for further details of the restatements.
Adjusted free cash flow and adjusted operating cash flow conversion
Adjusted free cash flow is net cash from operating activities less purchases of intangible assets, property,
plant and equipment plus any proceeds on sale of intangible assets, property, plant and equipment,
adjusted for the cash impact of substantial reorganisation costs and acquisition-related items and is a
performance measure for the annual incentive.
Adjusted operating cash flow is adjusted free cash flow before income tax and net interest paid.
Adjusted operating cash flow conversion is adjusted operating cash flow expressed as a percentage of
adjusted operating profit and is a financial KPI.
RS Group plc Annual Report and Accounts 2025156
2025
£m
2024
restated
1
£m
Net cash from operating activities 259.1 196.6
Purchase of intangible assets (33.1) (35.7)
Purchase of property, plant and equipment (16.2) (15.9)
Add back: impact of substantial reorganisation cash flows 0.2 0.7
Add back: impact of acquisition-related items cash flows 4.1 5.5
Adjusted free cash flow 214.1 151.2
Add back: income tax paid 60.4 73.3
Add back: net interest paid 29.3 31.0
Adjusted operating cash flow 303.8 255.5
Adjusted operating profit 274.2 306.2
Adjusted operating cash flow conversion 110.8% 83.4%
1. Please refer to Note 32 for further details of the restatement.
Earnings before interest, tax, depreciation and amortisation (EBITDA), net debt and net debt to
adjusted EBITDA
EBITDA is operating profit excluding depreciation and amortisation. Net debt to adjusted EBITDA (one of the
Group’s debt covenants) is the ratio of net debt to EBITDA excluding impairment of intangible assets arising on
acquisition of businesses, acquisition-related items, substantial reorganisation costs, substantial asset write-downs
and one-off pension credits or costs on an annualised basis covering the preceding twelve-month period. Net debt
comprises cash and cash equivalents, borrowings and lease liabilities and is reconciled in Note 22.
2025
£m
2024
restated
1
£m
Operating profit 232.8 274.5
Add back: depreciation and amortisation 85.4 83.7
EBITDA 318.2 358.2
Add back: impairment of acquired intangibles 11.3 –
Add back: acquisition-related items 4.1 5.1
Adjusted EBITDA 333.6 363.3
Net debt 364.2 418.2
Net debt to adjusted EBITDA 1.1x 1.2x
1. Please refer to Note 32 for further details of the restatement.
Earnings before interest, tax and amortisation (EBITA) and EBITA to interest
EBITA is adjusted EBITDA after depreciation. EBITA to interest (one of the Group’s debt covenants)
is the ratio of EBITA to finance costs including capitalised interest less finance income (interest per
debt covenants).
2025
£m
2024
restated
1
£m
Adjusted EBITDA 333.6 363.3
Less: depreciation (34.7) (35.5)
EBITA 298.9 327.8
Finance costs 32.0 36.7
Less: finance income (4.7) (4.8)
Interest (per debt covenants) 27.3 31.9
EBITA to interest 10.9x 10.3x
1. Please refer to Note 32 for further details of the restatement.
Return on capital employed (ROCE)
ROCE is adjusted operating profit expressed as a percentage of monthly average net assets excluding
net cash/debt and retirement benefit obligations and is an underpin for the LTIP and J2G LTIP Award and
a financial KPI.
2025
£m
2024
restated
1
£m
Average net assets 1,374.9 1,387.5
Add back: average net debt 414.7 371.5
Add back: average retirement benefit net obligations 20.2 31.2
Average capital employed 1,809.8 1,790.2
Adjusted operating profit 274.2 306.2
ROCE 15.2% 17.1%
1. Please refer to Note 32 for further details of the restatement.
RS Group plc Annual Report and Accounts 2025 157STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
3 Alternative Performance Measures (APMs) continued
Working capital as a percentage of revenue
Working capital is inventories, current trade and other receivables and current trade and other payables.
2025
£m
2024
restated
1
£m
Inventories 617.3 637.4
Current trade and other receivables 688.5 701.4
Current trade and other payables (611.0) (602.7)
Working capital 694.8 736.1
Revenue 2,903.5 2,942.4
Working capital as a percentage of revenue 23.9% 25.0%
1. Please refer to Note 32 for further details of the restatement.
Inventory turn
Inventory turn is cost of sales divided by inventories.
2025
£m
2024
restated
1
£m
Cost of sales 1,660.3 1,684.1
Inventories 617.3 637.4
Inventory turn 2.7 2.6
1. Please refer to Note 32 for further details of the restatement.
Ratio of capital expenditure to depreciation
Ratio of capital expenditure to depreciation is capital expenditure divided by depreciation and
amortisation excluding amortisation of acquired intangibles and depreciation of right-of-use assets.
2025
£m
2024
£m
Depreciation and amortisation 85.4 83.7
Less: amortisation of acquired intangibles (26.0) (26.6)
Less: depreciation of right-of-use assets (17.2) (18.6)
Adjusted depreciation and amortisation 42.2 38.5
Capital expenditure 48.9 51.2
Ratio of capital expenditure to depreciation 1.2 times 1.3 times
Group accounts continued
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
4 Revenue recognition
Revenue from the sale of goods is recognised in the income statement when control of the goods has
transferred, which in most countries is contractually on delivery to the customer but in a few countries
is contractually on collection from the Group’s distribution sites by the delivery company. When the
Group arranges the delivery of goods where control has transferred on collection, the customer is
invoiced an amount to cover the cost of freight and this is included in revenue as the goods are shipped.
Customers are invoiced on dispatch of the goods. Revenue is measured with reference to the amount
invoiced to the customer, net of any immediate discounts applicable to the order. Obligations for
retrospective customer volume discounts are calculated by estimating the expected discount percentage
that will be achieved for the contractual period using historical data adjusted for current experience
and applying that percentage to actual qualifying sales. When a customer has a right to return goods
purchased, the Group estimates the obligation for the expected value of the refunds using recent
experience. Obligations for both retrospective customer volume discounts and the expected value of
refunds for returns are deducted from the revenue recognised when the goods are sold and included in
other payables on the balance sheet and at 31 March 2025 were £19.1 million (2023/24: £16.7 million).
Products sourced for customers under the provision of outsourced services are sent directly by suppliers
to customers and the Group has no control over the products sourced and bears no inventory risk.
The Group does not have discretion in establishing the price as the price charged to customers is the
price charged by the suppliers. Therefore, the Group acts as an agent in relation to these products and
so does not recognise the value of these products in revenue or cost of sales. Revenue is measured with
reference to the amount invoiced to the customer for management charges and is recognised either
over time based on time elapsed for monthly management charges or when the related products are
delivered for other management charges. Invoices are raised monthly for monthly management charges
or when the invoices for the related products are invoiced for other management charges, normally on
a weekly or monthly basis. Income earned from suppliers for access to the Group’s online procurement
portals is recognised as revenue either over time based on time elapsed for subscription fees or as
their products are delivered to the Group’s customers for licence fees. Invoices are raised monthly,
quarterly or annually in advance for subscription fees depending on contractual terms. Credit notes for
licence fee income are received from suppliers depending on contractual terms with the least frequent
being annual.
Revenue from the sale of calibration services is recognised when control of the services has transferred,
which is upon delivery to the customer of the items which have been calibrated. Customers are invoiced
on dispatch of the calibrated items. Revenue is measured with reference to the amount invoiced to
the customer.
All revenue is recognised net of sales taxes and all payment terms are based on commercially reasonable
terms for the respective markets and no element of financing is deemed present.
Remaining performance obligations (unsatisfied or partially unsatisfied) at the year end all relate to
customer contracts that have an original expected duration of not more than one year or are invoiced
based on time incurred. As permitted under IFRS 15 ‘Revenue from Contracts with Customers’, the
transaction price allocated to these remaining performance obligations is not disclosed .
RS Group plc Annual Report and Accounts 2025158
5 Cost of sales
Cost of sales comprises the cost of goods delivered to customers and the write-down of inventories to
net realisable value, excluding freight and packaging expenses.
When a customer has a right to return goods, the Group estimates the expected value of the goods that
are likely to be returned based on historical experience and the expected gross margin. It recognises an
asset in other receivables for the right to recover these goods and deducts this from cost of sales when
the goods are sold.
The Group receives rebates from certain suppliers relating mainly to the volume of purchases made
in a specified time period. These rebates are recognised as a reduction in cost of sales to the extent
that the inventories purchased from the supplier and eligible for rebates have been sold in the year.
Rebates on purchases that remain in inventories are deducted from the cost of inventories, thus
reducing cost of sales in the income statement in the period in which the inventories are expensed.
The Group recognises the rebate only where there is evidence of a binding arrangement with the
supplier, the amount can be estimated reliably and receipt is probable. The Group estimates whether
the supplier rebates relate to products already sold or remaining in inventories, based on inventory
turns. When estimating the value of supplier rebates earned but not yet received, the Group makes
assumptions about the likely volume of eligible purchases to be made over the remaining rebate period.
As at 31 March 2025, the Group had £3.3 million (2023/24: £2.1 million) of supplier rebates recognised
within trade and other receivables.
2025
£m
2024
restated
1
£m
Inventory scrapped 15.1 13.2
Movement in inventory provisions 7.1 27.6
Write-down of inventories to net realisable value 22.2 40.8
Loss on foreign exchange related to sales and purchases 0.4 6.8
Net gains on forward foreign exchange contracts classified as fair value through profit
or loss
(0.1) (2.6)
Direct pass-through costs related to the provision of outsourced services 42.6 42.8
Inventories recognised as an expense 1,595.2 1,596.3
Cost of sales 1,660.3 1,684.1
1. Please refer to Note 32 for further details of the restatement.
6 Operating profit
The following items have been included in operating profit:
2025
£m
2024
£m
Amortisation of intangible assets (Note 14) 50.7 48.2
Depreciation of property, plant and equipment (Note 15) 17.5 16.9
Depreciation of right-of-use assets (Note 16) 17.2 18.6
Depreciation and amortisation 85.4 83.7
Impairment of intangible assets (Note 14) 12.8 4.6
Impairment of property, plant and equipment (Note 15) 0.4 –
Freight and packaging expenses 111.0 109.0
Amortisation of government grants (0.1) (0.1)
(Gain)/loss on other foreign exchange (0.6) 0.1
Net losses/(gains) on forward foreign exchange contracts classified as fair value through
profit or loss
0.7 (0.5)
Loss on disposal of intangible assets 0.3 0.2
Loss on disposal of property, plant and equipment 0.1 1.3
(Gain)/loss on disposal of right-of-use assets (0.3) 0.1
Increase in impairment allowance for financial assets (Note 23) 4.2 3.4
Employee costs (Note 8) 496.0 469.7
Fees paid to the Auditors were:
2025
£m
2024
£m
Fees payable to the Company’s Auditors for the audit of the Company
and Group accounts
2.1 1.1
Fees payable to the Company’s Auditors and their associates for other services:
Audit of the Company’s subsidiaries 2.0 2.0
Audit-related assurance services 0.1 0.1
Total fees payable to the Company’s Auditors and their associates 4.2 3.2
RS Group plc Annual Report and Accounts 2025 159STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
7 Finance income and costs
Finance costs that are directly attributable to the construction of an asset that necessarily takes a
substantial period of time to get ready for its intended use are capitalised as part of the cost of that
asset. Interest on financial assets and liabilities measured at amortised cost and on lease liabilities is
calculated using the effective interest method and recognised in the income statement as incurred.
Invoice finance charges relate to costs incurred when the Group makes use of its customers’ supplier
invoice financing options where this is commercially and administratively attractive. These options
are used for some outsourced services customers, including where they give the Group access to the
customers’ invoice portals to simplify the invoice query reconciliation process and so speed up the
receipt of payments.
2025
£m
2024
£m
Finance income
Interest income on financial assets measured at amortised cost 4.7 4.8
Finance income 4.7 4.8
Finance costs
Interest expense on financial liabilities measured at amortised cost (25.8) (28.1)
Interest expense on lease liabilities (2.8) (2.9)
Interest expense on financial liabilities not at fair value through profit or loss (28.6) (31.0)
Interest expense on tax payable (0.1) (1.2)
Interest credit/(charge) on uncertain income tax positions 0.4 (0.1)
Invoice finance charges (3.7) (4.4)
Finance costs (32.0) (36.7)
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
8 Employees
Average number of employees 2025 2024
EMEA 5,689 5,872
Americas 2,192 2,256
Asia Pacific 760 767
Central 68 69
Group 8,709 8,964
Employment costs
2025
£m
2024
£m
Wages and salaries 401.9 373.8
Social security costs 51.0 52.7
Share-based payments – equity-settled (Note 9) 9.4 7.8
Share-based payments – cash-settled (Note 9) (0.8) 0.4
Defined contribution retirement benefit costs (Note 10) 21.4 21.0
Defined benefit retirement benefit costs (Note 10) 3.4 4.1
486.3 459.8
Termination benefits 9.7 9.9
Total 496.0 469.7
Information on the Directors’ remuneration is given in the Directors’ Remuneration report on pages 104
to 131.
9 Share-based payments
The Group operates share-based payment schemes which are the LTIPs, the Deferred Share Bonus Plan
(DSBP) and the Savings-Related Share Option Scheme (SAYE).
Equity-settled share-based payments are measured at fair value at the grant date, calculated using
an appropriate option pricing model. The fair value is expensed in the income statement with a
corresponding increase in equity on a straight-line basis over the period that employees become
unconditionally entitled to the awards. The income statement charge is adjusted to reflect expected and
actual levels of vesting associated with non-market performance related criteria.
RS Group plc Annual Report and Accounts 2025160
Cash-settled share-based payments are measured at fair value at the balance sheet date, taking into
account the estimated number of awards that will actually vest and the relative completion of the vesting
period. This fair value is included in liabilities and changes in the value of these liabilities are recognised
in the income statement.
The Employee Benefit Trust (EBT) established to administer the schemes owns shares in the Company
which are shown in equity.
LTIPs – equity settled and cash settled
The Group’s active LTIPs are granted under the 2019 LTIP, the 2022 LTIP, the J2G LTIP Award and the
RS YAY! Award. Under these LTIPs, awards are made to plan participants normally subject to service
conditions and performance conditions. Some of the awards are equity settled and some are cash
settled. At the vesting date the award will either vest, in full or in part, or expire, normally depending on
the outcome of the performance conditions. All awards have £nil exercise price and normally receive
accrued dividends on settlement.
Those awards made under the 2019 LTIP in 2021/22 (vested in June 2024) were normally subject to a
market performance condition based on total shareholder return (TSR) of the Group versus a defined
comparator group (see the Directors’ Remuneration report for details) and a non-market performance
condition based on cumulative growth in adjusted earnings per share (EPS) over the vesting period with
a ROCE underpin.
Awards under the 2022 LTIP are subject to a market performance condition based on TSR of the Group
versus a defined comparator group (see the Directors’ Remuneration report for details) and a non-
market performance condition based on the adjusted EPS compound annual growth rate (CAGR) over
the vesting period with a ROCE underpin, or subject to the continued employment of the participant
within the Group.
Awards under the J2G LTIP Award to senior management are subject to non-market performance
conditions based on the adjusted EPS CAGR over the vesting period and a scorecard of key performance
indicators directly linked to The RS Way scorecard, with a ROCE underpin.
Awards under the RS YAY! Award to all other employees are subject to a non-market performance
condition based on adjusted profit before tax CAGR over the vesting period.
The fair values of equity-settled LTIP awards were calculated at the grant date using the assumptions
below, with the fair value of those subject to market performance conditions calculated using a Monte
Carlo model.
2025 2024
Grant date
December
2024
June
2024
December
2023
November
2023
June
2023
May
2023
Market performance conditions
Awards granted 32,298 447,743 31,818 110,006 6,109 931,186
Fair value at grant date 243p 268p 243p 184p 251p 295p
Assumptions used:
Share price 701p 698p 816p 714p 800p 798p
Expected volatility 29.2% 29.0% 29.5% 29.6% 30.0% 30.2%
Expected life 2 years
5 months
3 years 2 years
5 months
2 years
6 months
2 years
11 months
3 years
Risk-free interest rate 4.07% 4.24% 3.97% 4.29% 4.95% 4.50%
Other conditions
Awards granted - LTIP 32,298 447,743 31,818 135,979 44,851 1,307,163
Fair value at grant date 640p 637p 816p 714p 800p 798p
Awards granted - restricted shares 136,838 774,977 – 42,655 8,819 106,376
Fair value at grant date 701p 698p – 714p 800p 798p
Expected volatility was estimated based on the historical volatility of the Company’s shares over the most
recent period commensurate to the expected life of the award. The risk-free interest rate represents the
yield, at the grant date, of UK government bonds with duration commensurate to the expected life of
the award.
The fair values of cash-settled LTIP awards at 31 March 2025 were:
Awards
granted Fair value
July 2022 - Other conditions 12,000 140p
December 2022 - Other conditions 1,300 140p
June 2023 - Other conditions 462 140p
December 2023 - Other conditions 2,419 0p
June 2024 - Other conditions 7,035 562p
RS Group plc Annual Report and Accounts 2025 161STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
9 Share-based payments continued
The movements in the LTIP awards (equity and cash settled) were:
2025
Number of
awards
2024
Number of
awards
Outstanding at 1 April 6,827,091 6,302,743
Forfeited during the year (507,411) (1,019,886)
Expired during the year (427,907) (585,383)
Exercised during the year (475,579) (632,463)
Granted during the year 1,913,933 2,762,080
Outstanding at 31 March 7,330,127 6,827,091
DSBP – equity settled
Under the DSBP, one-third of the total annual incentive earned by plan participants is awarded as shares
and vests after two years, normally subject to the continued employment of the participant within the
Group. There are no other performance conditions. The participants receive accrued dividends on
vesting. Deferred share awards relating to the annual incentive for the year ended 31 March 2025 are
expected to be awarded in June 2025. The fair value of the shares awarded during the year was 698p
(2023/24: 803p) per share award which was the share price at the date of award.
The movements in the DSBP awards were:
2025
Number of
awards
2024
Number of
awards
Outstanding at 1 April 248,588 224,185
Forfeited during the year – –
Exercised during the year (115,527) (108,658)
Granted during the year 44,334 133,061
Outstanding at 31 March 177,395 248,588
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
SAYE – equity settled and cash settled
The SAYE scheme is available to the majority of employees of the Group employed at the time that
the invitation period commences. The UK element is equity settled and the overseas element is cash
settled. The option price is based on the average market price of the Company’s shares over the three
days prior to the offer, discounted by 20%. The option exercise conditions are the employee’s continued
employment for a three-year period and the maintenance of employee’s regular monthly savings.
Failure of either of these conditions is normally deemed a forfeiture of the option.
Employees may subscribe to the three-year or, when offered, the five-year savings period. Under the UK
element, at the end of the savings period, the employee has six months to either exercise their options
to purchase the shares at the agreed price or withdraw their savings with accrued interest. Under the
overseas element, at the end of the savings period, the employee has six months to either exercise
their options to receive cash equal to the difference between the market price and the option price or
withdraw their savings with accrued interest. There are no market conditions attached to the vesting of
the options.
The fair value of equity-settled SAYE options was calculated at the grant date using a Black-Scholes
model, with the assumptions below.
2025 2024
Grant date
3 year
December
2024
3 year
November
2023
Options granted 879,923 1,814,474
Fair value at grant date 219p 265p
Assumptions used:
Share price 722p 776p
Exercise price 573p 562p
Expected volatility 31.5% 28.7%
Expected option life 3 years
2 months
3 years
Expected dividend yield 2.93% 2.50%
Risk-free interest rate 4.01% 4.14%
Expected volatility was estimated based on the historical volatility of the Company’s shares over the most
recent three-year period. Expected dividend yield was the annual dividend yield as at the grant date.
The risk-free interest rate was the yield, at the grant date, of three-year UK government bonds.
RS Group plc Annual Report and Accounts 2025162
The fair values of cash-settled SAYE options at 31 March 2025 are shown below and were calculated
using a Black-Scholes model, using a share price of 562p, expected dividend yield of 3.1% and additional
assumptions below.
Options
granted Fair value Exercise price
Expected
volatility
Expected
remaining
option life
Risk-free
interest rate
5 year September 2020 19,798 48p 573p 30.7% 0.6 4.06%
5 year September 2021 11,939 20p 824p 29.5% 1.6 4.21%
3 year December 2022 518,735 20p 715p 30.7% 0.8 4.06%
3 year November 2023 707,264 87p 562p 29.2% 1.8 4.21%
3 year December 2024 309,326 106p 573p 30.5% 2.8 4.18%
Expected volatility is estimated based on the historical volatility of the Company’s shares over the most
recent period commensurate to the expected remaining life of the option. Expected dividend yield is
the annual dividend yield as at the year end. The risk-free interest rate is the yield, at the year end,
of UK government bonds with duration commensurate to the expected remaining life of the option.
The movements in and weighted average exercise price of the SAYE options (equity and cash
settled) were:
2025 2024
Weighted
average
exercise
price
Number of
options
Weighted
average
exercise
price
Number of
options
Outstanding at 1 April 616p 4,526,870 662p 4,056,336
Forfeited during the year 641p (195,806) 733p (299,010)
Expired during the year 623p (646,268) 708p (847,998)
Exercised during the year 500p (373,468) 539p (904,196)
Granted during the year 573p 1,189,249 562p 2,521,738
Outstanding at 31 March 612p 4,500,577 616p 4,526,870
Exercisable at 31 March 767p 391,978 573p 125,525
SAYE options outstanding at the year end were:
2025 2024
Option prices:
£4.00 - £4.99 57,406 280,813
£5.00 - £5.99 3,284,752 2,761,202
£7.00 - £7.99 795,500 1,048,950
£8.00 - £8.99 362,919 435,905
4,500,577 4,526,870
Weighted average remaining contractual life (in years) 2.01 2.62
Weighted average share price during period of exercise 701p 753p
10 Retirement benefit obligations
For defined benefit schemes, the surplus or deficit recognised in the balance sheet is the difference
between the fair value of the scheme assets and the present value of the obligations at the balance
sheet date. The present value of the obligations is calculated by independent actuaries using the
projected unit credit method. It is determined by discounting estimated future cash outflows using a
discount rate reflecting yields on high-quality corporate bonds with terms approximating the terms of
the related obligation. The operating profit charge comprises the current service cost, net interest cost,
past service costs, administrative expenses, curtailment gains and losses and settlement gains and
losses. The net interest cost is based on the discount rate at the beginning of the year, contributions
paid in and the surplus or deficit during the year. Past service costs and curtailment gains and losses are
recognised at the earlier of when the scheme amendment or curtailment occurs and when any related
reorganisation costs or termination benefits are recognised. Settlement gains and losses are recognised
when the settlement occurs. Remeasurements, representing returns on scheme assets excluding
amounts included in interest and actuarial gains and losses arising from changes in demographic and
financial assumptions and experience adjustments, are recognised in other comprehensive income.
The Group’s largest defined benefit pension scheme is in the UK, providing benefits based on
final pensionable pay for eligible employees who joined on or before 1 April 2003. The scheme is
administered by a corporate trustee and the funds are independent of the Group’s finances. The Group
also has defined benefit pension schemes in Germany and the Republic of Ireland which are closed to
both new members and accruals for future service, defined benefit retirement indemnity schemes in
France and Italy, and a contribution-based pension scheme in Switzerland that guarantees a minimum
rate of investment return and so is accounted for under IAS 19 ‘Employee Benefits’ as a defined benefit
pension scheme.
RS Group plc Annual Report and Accounts 2025 163STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
10 Retirement benefit obligations continued
For defined contribution schemes, the costs are charged to operating profit as they fall due. The Group
has defined contribution schemes in a number of countries, including the UK, the US, Australia and
Germany, and contributes to government schemes in a number of other countries that are defined
contribution schemes. The Group also makes payments to employees’ personal pensions in the UK when
their employing company does not provide defined benefit or defined contribution schemes.
Regulatory framework and governance
The UK scheme, the RS Group Pension Scheme, is a registered scheme established under trust law
and, as such, is subject to UK pension, tax and trust legislation. It is managed by a corporate trustee,
RS Group Pension Trustees Limited (the Trustee). The Trustee includes representatives appointed by
both the Company and members. Although the Company bears the financial cost of the scheme, the
Trustee directors are responsible for the overall management of the scheme including compliance with
applicable regulations and legislation. The Trustee directors are required by law to act in the interest
of all relevant beneficiaries and to set certain policies, to manage the day-to-day administration of the
benefits and to set the scheme investment strategy in consultation with the Company.
UK pensions are regulated by the Pensions Regulator whose statutory objectives and regulatory powers
are described on its website: thepensionsregulator.gov.uk
Deficit position and funding
The funding of the UK scheme is assessed using assumptions in accordance with the advice of
independent actuaries. These assumptions may be different to those used for the accounting valuation.
The last triennial funding valuation was carried out as at 31 March 2022 and showed a deficit of
£36.4 million on a statutory technical provisions basis. The Trustee and the Company agreed a recovery
plan to eliminate this deficit over time. Under this plan, the Group agreed to make deficit contributions
of £11.1 million per annum with the aim that the scheme will be fully funded on a statutory technical
provisions basis by 30 September 2025.
The rules of the UK scheme give the Trustee powers to wind up the scheme, which it may exercise if the
Trustee is aware that the assets of the scheme are insufficient to meet its liabilities. Although the scheme
was in deficit on a statutory funding basis at 31 March 2022, the Trustee has confirmed that it has no
current intention to exercise its power to wind up the scheme.
Under the UK scheme’s rules the power to wind up the scheme and augment benefits is with the
Trustee and, therefore, under IFRIC 14 the Group does not have an unconditional right to any surplus
that may arise. On that basis, the defined benefit net asset at 31 March 2025 has been restricted to £nil
(2023/24: £nil) and an additional liability of £5.4 million (2023/24: £16.1 million) has been recognised
which is equal to the present value of the agreed future deficit contributions under the recovery plan.
Based on the funding position as at 31 March 2025, in the year ending 31 March 2026 the Group
expects to pay £7.5 million of contributions to the UK scheme, including £5.6 million of deficit
contribution payments, and £0.9 million to the other defined benefit schemes.
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
Investment strategy and risk exposure
The defined benefit schemes expose the Group to actuarial risks such as longevity, interest rate, inflation
and investment risks. The approach for managing the UK scheme’s investment strategy and risks are set
out below.
Interest rate risk
The Trustee has set a benchmark for total investment in bonds (government and corporate), interest
rate swaps, inflation swaps, gilt repurchase agreements and cash as part of its matching asset portfolio
(comprising the qualifying investor alternative investment fund (QIAIF), a bespoke pooled structure in
which the scheme is the sole investor). Under this strategy, if gilt yields fall, the value of the investments
within the matching asset portfolio will rise to help match the increase in the valuation of the liabilities
arising from a fall in the discount rate, which is derived from gilt yields. Similarly, if gilt yields rise, the
value of the matching asset portfolio will fall, as will the valuation of the liabilities because of an increase
in the discount rate.
Inflation risk
The scheme holds index-linked gilts, inflation swaps and repurchase agreements to manage against
inflation risk associated with pension liability increases. Derivatives are only held indirectly, via the QIAIF.
Longevity risk
Prudent mortality assumptions are used that appropriately allow for future improvements in life
expectancy. These assumptions are reviewed on a regular basis to ensure they remain appropriate.
The Trustee uses the Club Vita service to provide a better estimate of the mortality rates of the scheme’s
membership than the standard tables. Club Vita facilitates the accumulation and pooling of data
and helps pension schemes understand and manage longevity risk by providing data-driven insights
into life expectancy patterns and trends, enabling more informed strategic decisions and better risk
management. With effect from 1 June 2008, the scheme introduced a mortality risk sharing mechanism
whereby members’ benefits for pensionable service after that date will be reduced if the life expectancy
of the scheme’s members increases more quickly than a pre-determined rate.
Environmental, social and governance (ESG) and climate risk
The Trustee considers how ESG and climate change are integrated within investment processes and
how they align with the Trustee’s policies in appointing new investment managers and monitoring
existing investment managers. The Trustee has set out clear expectations for its advisors and the
scheme’s investment managers to consider ESG issues, including climate change, where relevant to
investment outcomes. The Trustee, together with its advisor, monitors annually the extent to which ESG
factors, including explicit consideration of climate change, are integrated into the investment managers’
approaches. To supplement this, the Trustee makes regular use of the investment consultant’s ESG
ratings and will engage proactively with investment managers whose ESG ratings are judged to be
lagging their peers within the asset class. The investment and risk subcommittee meets all investment
managers at least annually to discuss ESG and climate change issues specifically.
RS Group plc Annual Report and Accounts 2025164
Assumptions
Financial assumptions
The principal assumptions used to determine the UK defined benefit obligations were:
2025 2024
Discount rate 5.80% 4.90%
Rate of increase in pensionable salaries Nil Nil
Rate of RPI inflation 3.10% 3.20%
Rate of CPI inflation 2.80% 2.80%
Rate of pension increases
RPI inflation capped at 5.0% p.a. 2.90% 2.95%
RPI inflation capped at 2.5% p.a. 1.90% 1.95%
Life expectancy assumptions
Based upon the demographics of scheme members, the weighted average life expectancy assumptions
used to determine the UK defined benefit obligations were:
2025
Years
2024
Years
Member aged 65 (current life expectancy) – male 22.1 22.0
Member aged 65 (current life expectancy) – female 23.5 23.4
Member aged 45 (life expectancy at aged 65) – male 22.5 23.4
Member aged 45 (life expectancy at aged 65) – female 25.2 25.1
At 31 March 2025, the weighted average duration of the UK defined benefit obligation was 12 years
(2023/24: 14 years).
Sensitivity analysis of the impact of changes in key assumptions
The calculations of the defined benefit obligations are sensitive to the assumptions used. The sensitivity
analysis below is based on a change in reasonably potential assumptions for the UK scheme while
holding all other assumptions constant, as the amount of the Retirement Obligation for the other
defined benefit schemes is less material to the Group; in practice changes in some of the assumptions
may be correlated.
A change would have the following increase/(decrease) on the UK defined benefit obligations as at
31 March 2025:
Increase in
assumption
£m
Decrease in
assumption
£m
Effect on obligation of a 0.5 pts change to the assumed discount rate (19.8) 21.9
Effect on obligation of a 0.25 pts change in the assumed inflation rate 9.5 (9.2)
Effect on obligation of a change of one year in assumed life expectancy 8.9 (8.9)
Income statement
The net charge/(credit) recognised in operating profit for retirement benefit obligations was:
2025 2024
UK
£m
Other
£m
Total
£m
UK
£m
Other
£m
Total
£m
Current service cost 1.1 0.5 1.6 1.2 0.4 1.6
Past service cost – (0.1) (0.1) – (0.1) (0.1)
Interest expense on obligation 18.4 0.8 19.2 18.7 0.9 19.6
Interest income on scheme assets (20.5) (0.6) (21.1) (20.7) (0.6) (21.3)
Interest expense on asset ceiling/
onerous liability
2.6 0.1 2.7 3.0 0.1 3.1
Administrative expenses 1.1 – 1.1 1.2 – 1.2
Total charge for defined
benefit schemes
2.7 0.7 3.4 3.4 0.7 4.1
Total charge for defined
contribution schemes and
personal pensions
11.2 10.2 21.4 10.6 10.4 21.0
RS Group plc Annual Report and Accounts 2025 165STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
10 Retirement benefit obligations continued
Balance sheet
The amounts included in the balance sheet arising from the Group’s assets/(obligations) in respect of its
defined benefit schemes was:
2025 2024
UK
£m
Other
£m
Total
£m
UK
£m
Other
£m
Total
£m
Fair value of scheme assets 400.4 32.5 432.9 421.2 30.8 452.0
Present value of defined benefit
obligations
(342.6) (36.7) (379.3) (385.1) (36.7) (421.8)
Effect of asset ceiling/onerous liability (63.2) (4.3) (67.5) (52.2) (3.7) (55.9)
Retirement benefit net obligations (5.4) (8.5) (13.9) (16.1) (9.6) (25.7)
Amount recognised on the balance
sheet - liability
(5.4) (11.0) (16.4) (16.1) (11.1) (27.2)
Amount recognised on the balance
sheet - asset
– 2.5 2.5 – 1.5 1.5
The other defined benefit schemes were:
2025 2024
Fair
value of
scheme
assets
£m
Present
value of
defined
benefit
obligations
£m
Effect
of asset
ceiling/
onerous
liability
£m
Retirement
benefit
obligations
£m
Fair value
of scheme
assets
£m
Present
value of
defined
benefit
obligations
£m
Effect
of asset
ceiling/
onerous
liability
£m
Retirement
benefit
obligations
£m
Germany’s defined benefit
pension scheme
– (6.8) – (6.8) – (7.2) – (7.2)
Republic of Ireland’s defined
benefit pension scheme
7.0 (5.1) – 1.9 7.2 (5.7) – 1.5
France’s defined benefit
retirement indemnity scheme
– (3.0) – (3.0) – (3.1) – (3.1)
Italy’s defined benefit
retirement indemnity scheme
– (1.2) – (1.2) – (0.8) – (0.8)
Switzerland’s contribution-
based scheme
25.5 (20.6) (4.3) 0.6 23.6 (19.9) (3.7) –
Other 32.5 (36.7) (4.3) (8.5) 30.8 (36.7) (3.7) (9.6)
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
Movements in the present value of the defined benefit obligations in the year were:
2025 2024
UK
£m
Other
£m
Total
£m
UK
£m
Other
£m
Total
£m
At 1 April 385.1 36.7 421.8 390.5 16.8 407.3
Acquisitions – 0.6 0.6 – 20.5 20.5
Current service cost 1.1 0.5 1.6 1.2 0.4 1.6
Past service cost – (0.1) (0.1) – (0.1) (0.1)
Interest expense 18.4 0.8 19.2 18.7 0.9 19.6
Effect of changes in demographic assumptions – – – (5.1) – (5.1)
Effect of changes in financial assumptions (43.5) (1.0) (44.5) (4.4) 1.6 (2.8)
Effect of experience adjustments 0.9 0.8 1.7 2.3 0.1 2.4
Benefits paid (19.4) (1.4) (20.8) (18.1) (3.2) (21.3)
Employee contributions – 0.2 0.2 – 0.1 0.1
Exchange differences – (0.4) (0.4) – (0.4) (0.4)
At 31 March 342.6 36.7 379.3 385.1 36.7 421.8
Of the UK scheme’s present value of the defined benefit obligations, £30.9 million
(2023/24: £33.8 million) relates to active members, £135.9 million (2023/24: £153.6 million) to vested
deferred members and £175.8 million (2023/24: £197.7 million) to retirees.
RS Group plc Annual Report and Accounts 2025166
Movements in the fair value of the schemes’ assets in the year were:
2025 2024
UK
£m
Other
£m
Total
£m
UK
£m
Other
£m
Total
£m
At 1 April 421.2 30.8 452.0 425.4 6.6 432.0
Acquisitions – – – – 25.6 25.6
Interest income 20.5 0.6 21.1 20.7 0.6 21.3
Return on scheme assets (excluding
interest income)
(33.9) 1.5 (32.4) (18.6) 0.5 (18.1)
Contributions by company 13.1 1.0 14.1 13.0 0.9 13.9
Benefits paid (19.4) (1.4) (20.8) (18.1) (3.2) (21.3)
Administrative expenses (1.1) – (1.1) (1.2) – (1.2)
Employee contributions – 0.2 0.2 – 0.1 0.1
Exchange differences – (0.2) (0.2) – (0.3) (0.3)
At 31 March 400.4 32.5 432.9 421.2 30.8 452.0
The fair values of the schemes’ assets were:
2025 2024
UK
£m
Other
£m
Total
£m
UK
£m
Other
£m
Total
£m
QIAIF (liability driven investment and credit
portfolio of quoted assets)
213.5 – 213.5 264.9 – 264.9
Quoted equities – 10.7 10.7 – 10.1 10.1
Quoted debt instruments 102.6 13.5 116.1 68.3 12.8 81.1
Unquoted debt instruments 83.5 – 83.5 87.8 – 87.8
Property – 8.2 8.2 – 7.7 7.7
Cash 0.8 0.1 0.9 0.2 0.2 0.4
Total market value of scheme assets 400.4 32.5 432.9 421.2 30.8 452.0
Property relates to investments in unquoted real estate funds and no property or real estate funds
are held directly. The split of UK quoted and unquoted debt instruments is based on the split of the
underlying assets of pooled investment vehicles in which the scheme is invested.
The fair values of the unquoted debt instruments are determined by the fund managers using quoted
prices for similar assets or other valuation techniques where all the inputs are directly observable or
indirectly observable from market data.
The defined benefit schemes do not invest in the Company and no assets owned by the schemes are
used by the Group.
Movements in the effect of asset ceiling/onerous liability were:
2025 2024
UK
£m
Other
£m
Total
£m
UK
£m
Other
£m
Total
£m
At 1 April 52.2 3.7 55.9 61.1 – 61.1
Acquisitions – – – – 5.1 5.1
Interest expense 2.6 0.1 2.7 3.0 0.1 3.1
Change in asset ceiling/onerous liability (excluding
interest expense)
8.4 0.5 8.9 (11.9) (1.5) (13.4)
At 31 March 63.2 4.3 67.5 52.2 3.7 55.9
11 Taxation
Current and deferred tax are recognised in the income statement, except when they relate to items
recognised in other comprehensive income or directly in equity when the related tax is also recognised
in other comprehensive income or directly in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted
or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of
previous years.
The Group recognises deferred tax assets and liabilities based on estimates of future taxable income
and recoverability. Deferred tax is provided using the balance sheet liability method, providing for
temporary differences between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes.
The amount of deferred tax provided is calculated using tax rates enacted or substantively enacted at
the balance sheet date that are expected to apply when the deferred tax asset is realised or the deferred
tax liability is settled. Deferred tax assets are recognised to the extent that it is probable that future
taxable profits will be available against which these temporary differences can be utilised.
No deferred tax liabilities are recognised on the initial recognition of goodwill. However, when goodwill
arises in a jurisdiction where it is deductible in determining taxable profit, the amortisation for tax
purposes of goodwill creates a taxable temporary difference and this resulting deferred tax liability
is recognised.
RS Group plc Annual Report and Accounts 2025 167STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
11 Taxation continued
The Group recognises a current tax provision when the Group has a present obligation as a result
of a past event, and it is considered probable that there will be a future outflow of funds. As an
international business, the Group is exposed to the income tax laws of the large number of jurisdictions
in which it operates. These laws are complex and subject to different interpretations by taxpayers
and tax authorities. The assessment of uncertain tax positions is subjective. It is based on the Group’s
interpretation of country-specific tax law and its application and interaction, on previous experience and
on management’s professional judgement supported by external advisors where necessary.
The Group estimates a provision for uncertain tax positions by making judgements about the position
likely to be taken by each tax authority. Where it is considered probable that the tax authority will accept
the tax treatment used, or expected to be used, in the income tax return, the accounts reflect the
treatment in the return. Where it is not considered probable that the tax authority will accept the tax
treatment, the tax amounts in the accounts reflect that uncertainty using either the most likely amount
or the expected value amount depending on which method is expected to reflect the resolution of that
uncertainty better.
Provisions for uncertain tax positions are included within current tax liabilities. The Group’s uncertain
tax positions relate principally to cross-border transfer pricing. As at 31 March 2025, the total value of
these tax provisions was £9.1 million (2023/24: £8.8 million). It is possible that the amounts paid will be
different from the amounts provided but this is not expected to be material.
Penalties and interest on provisions for uncertain tax positions are included in Note 24.
Tax expense/(income) recognised in the income statement
2025
£m
2024
restated
1
£m
Current tax
Current tax on profits for the year 58.6 67.8
Adjustments for prior years (0.1) 6.3
Total current tax 58.5 74.1
Deferred tax
Origination and reversal of temporary differences (4.3) (3.9)
Adjustments for prior years (0.7) (6.4)
Total deferred tax (5.0) (10.3)
Income tax expense 53.5 63.8
1. Please refer to Note 32 for further details of the restatement.
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
The income tax expense for the year can be reconciled to the profit per the income statement as follows:
2025
£m
2024
restated
1
£m
Profit before tax 206.1 243.2
Expected tax charge at UK corporation tax rate of 25% (2024: 25%) 51.6 60.8
Recurring items
Differences in overseas corporation tax rates (1.2) 0.3
Impact of tax losses (1.7) (0.1)
Items not taxable for tax purposes (0.8) (1.2)
Items not deductible for tax purposes 3.3 4.7
Other local taxes suffered overseas 2.1 1.1
Non-recurring items
Changes in tax rates and laws 0.7 –
Movement in uncertain tax provisions in current year 1.1 0.9
Movement in uncertain tax provisions for prior years (0.8) (2.6)
Prior year adjustments (0.8) (0.1)
53.5 63.8
1. Please refer to Note 32 for further details of the restatement.
The Group is within the scope of the OECD Pillar Two model rules, which the UK government
substantively enacted in its Finance (No.2) Act 2023 on 20 June 2023, introducing an income inclusion
rule and domestic minimum top-up tax that apply for accounting periods beginning on or after
31 December 2023. The Group has done a review of the impact of these rules and it does not have a
material impact on the reported results or financial position of the Group.
Tax expense/(income) recognised directly in other comprehensive income
2025
£m
2024
£m
Relating to remeasurement of retirement benefit obligations 0.3 0.1
Relating to movement in cash flow hedges 0.2 –
0.5 0.1
RS Group plc Annual Report and Accounts 2025168
Movement in deferred tax assets and liabilities
Intangible
assets
(excluding
goodwill),
right-of-use
assets and
property,
plant and
equipment
£m
Goodwill
£m
Retirement
benefit
obligations
£m
Employee
benefits
£m
Tax losses
£m
Lease
liabilities
£m
Other
£m
Net tax
(liabilities)/
assets
£m
At 1 April 2023 (71.9) (51.2) 8.7 12.0 2.8 13.1 3.3 (83.2)
Prior period restatement
(Note 32)
– – – – – – 3.2 3.2
At 1 April 2023 (restated
1
) (71.9) (51.2) 8.7 12.0 2.8 13.1 6.5 (80.0)
Acquisitions (25.7) – – – 2.4 6.8 2.4 (14.1)
Credit/(charge) to income
statement (restated
1
)
8.9 0.3 0.4 (3.7) 1.6 (1.0) 3.8 10.3
Recognised directly in equity – – (2.9) (1.7) – – – (4.6)
Translation differences (1.7) 1.0 (0.1) (0.1) – – 0.1 (0.8)
At 31 March 2024 restated
1
(90.4) (49.9) 6.1 6.5 6.8 18.9 12.8 (89.2)
Acquisitions (Note 29) (0.8) – – – – – – (0.8)
Credit/(charge) to income
statement
12.6 (0.4) (0.1) (1.1) (3.6) (5.0) 2.6 5.0
Recognised directly in equity – – (2.7) (0.4) – – – (3.1)
Translation differences 6.0 1.1 – (0.2) (1.2) – 1.9 7.6
At 31 March 2025 (72.6) (49.2) 3.3 4.8 2.0 13.9 17.3 (80.5)
Analysed in the balance sheet as:
2025
£m
2024
restated
1
£m
2023
restated
1
£m
Deferred tax assets 11.1 9.5 6.9
Deferred tax liabilities (91.6) (98.7) (86.9)
(80.5) (89.2) (80.0)
1. Please refer to Note 32 for further details of the restatement.
A deferred tax asset has been recognised for tax losses where current projections show that sufficient
taxable profits will arise in the near future against which these losses may be offset. A deferred tax asset
has not been recognised in respect of carry-forward tax losses where recoverability is uncertain totalling
£0.6 million (2023/24: £1.3 million) which carries no expiry date.
12 Earnings per share
Basic earnings per share is calculated by dividing the profit for the year attributable to owners of the
Company by the weighted average number of shares in issue during the year excluding shares held by
the EBT.
Diluted earnings per share is calculated by adjusting the weighted average number of shares to assume
the conversion of all potentially dilutive ordinary shares. The share-based payment schemes which result
in the issue of shares at a value below the market price of the shares are potentially dilutive.
2025
Number
2024
restated
1
Number
Weighted average number of shares 470,022,152 473,300,106
Dilutive effect of share-based payments 214,829 781,177
Diluted weighted average number of shares 470,236,981 474,081,283
Basic earnings per share 32.5p 37.9p
Diluted earnings per share 32.5p 37.8p
1. Please refer to Note 32 for further details of the restatement.
13 Dividends
2025
£m
2024
£m
Final dividend for the year ended 31 March 2024 – 13.7p (2023: 13.7p) 64.9 64.8
Interim dividend for the year ended 31 March 2025 – 8.5p (2024: 8.3p) 39.8 39.3
104.7 104.1
The trustees of the EBT have waived their right to receive dividends and this amounts to £0.8 million
(2023/24: £nil).
A proposed final dividend for the year ended 31 March 2025 of 13.9p is subject to approval by
shareholders at the Annual General Meeting on 17 July 2025 and the estimated amount to be paid of
£65.1 million has not been included as a liability in these accounts.
RS Group plc Annual Report and Accounts 2025 169STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
14 Intangible assets
Goodwill represents the excess of the fair value of the consideration of an acquisition over the fair value
attributed to the net assets acquired (including contingent liabilities). Goodwill is not amortised but
is reviewed annually for impairment. Acquisition-related costs are charged to the income statement
as incurred.
Intangible assets excluding goodwill are stated at cost, or fair value at the date of acquisition, less
accumulated amortisation and any provisions for impairment. Residual value is reassessed annually.
Expenditure on internally generated goodwill and brands is recognised in the income statement
as an expense as incurred. Amortisation is calculated to write off the cost on a straight-line basis
over the following useful lives from the date the assets are first available for use: software 2 – 11
years; development expenditure 3 years; brands 5 – 10 years; customer contracts, relationships and
distribution agreements 4 – 16 years; and acquired research 3 years.
Goodwill
£m
Software
£m
Development
expenditure
£m
Brands
£m
Customer
contracts,
relationships
and
distribution
agreements
£m
Acquired
research
£m
Total
£m
Cost
At 1 April 2023 463.3 343.5 1.8 – 199.8 1.1 1,009.5
Acquisitions 182.3 10.6 – 22.1 73.5 – 288.5
Additions - internally
generated
– 12.4 – – – – 12.4
Additions - other – 23.2 – – – – 23.2
Disposals – (1.0) – – – – (1.0)
Translation differences 0.7 (1.3) – (0.1) 6.4 – 5.7
At 31 March 2024 646.3 387.4 1.8 22.0 279.7 1.1 1,338.3
Acquisitions (Note 29) 5.9 – – – 0.5 – 6.4
Additions - internally
generated
– 16.5 – – – – 16.5
Additions - other – 16.5 – – – – 16.5
Disposals – (2.4) – – – – (2.4)
Reclassifications – 3.0 – – – – 3.0
Translation differences (35.8) (2.0) – (0.7) (26.3) – (64.8)
At 31 March 2025 616.4 419.0 1.8 21.3 253.9 1.1 1,313.5
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
Goodwill
£m
Software
£m
Development
expenditure
£m
Brands
£m
Customer
contracts,
relationships
and
distribution
agreements
£m
Acquired
research
£m
Total
£m
Amortisation
At 1 April 2023 – 265.3 1.4 – 37.2 0.8 304.7
Charge for the year – 21.2 0.4 2.0 24.3 0.3 48.2
Impairment losses – 4.6 – – – – 4.6
Disposals – (0.8) – – – – (0.8)
Translation differences – (1.2) – – 0.2 – (1.0)
At 31 March 2024 – 289.1 1.8 2.0 61.7 1.1 355.7
Charge for the year – 24.7 – 2.6 23.4 – 50.7
Impairment losses – 1.9 – – 10.9 – 12.8
Disposals – (2.1) – – – – (2.1)
Reclassifications – 2.4 – – – – 2.4
Translation differences – (1.2) – (0.1) (3.6) – (4.9)
At 31 March 2025 – 314.8 1.8 4.5 92.4 1.1 414.6
Net book value
At 31 March 2025 616.4 104.2 – 16.8 161.5 – 898.9
At 31 March 2024 646.3 98.3 – 20.0 218.0 – 982.6
During the year, £2.4 million was reclassified between cost and accumulated amortisation of software
following a review of the fixed asset register. £0.6 million was also reclassified between software, plant
and machinery.
As at 31 March 2025, the cost and accumulated amortisation of internally generated intangible assets
included in software were £91.6 million and £59.4 million (2023/24: £78.8 million and £49.5 million),
respectively.
RS Group plc Annual Report and Accounts 2025170
At 31 March 2025, the material individual software assets were the new product management system
with a net book value of £18.2 million (2023/24: £16.0 million) which will have a useful life of 8 years,
and the inventory availability and product fufilment module with a net book value of £10.6 million
(2023/24: £6.7 million) which will have a useful life of 5 years. Material individual customer contracts,
relationships and distribution agreements are from the acquisitions of Synovos, Risoul and Distrelec
with net book values of £10.4 million, £75.8 million and £63.6 million, respectively (2023/24: £14.4 million,
£105.0 million and £69.7 million) and remaining useful lives of 4 years, 1 to 14 years and 15 years,
respectively.
Goodwill is allocated at acquisition to groups of cash generating units (CGUs) that are
expected to benefit from the synergies arising as a result of the acquisition, with £380.1 million
(2023/24: £412.1 million) relating to the Americas group of CGUs, £227.5 million (2023/24: £231.1 million)
relating to the EMEA group of CGUs and £8.8 million (2023/24: £3.1 million) relating to the Asia Pacific
group of CGUs. Cash generating units represent the smallest identifiable groups of assets that generate
cash inflows that are largely independent of the cash inflows from other groups of assets.
The Group reviews its intangible assets regularly to assess if there are any indications the assets may
be impaired. In addition, goodwill and any other intangible assets that are not yet being amortised are
subject to annual impairment reviews.
An impairment loss is recognised whenever the carrying amount of an asset or its cash generating unit
exceeds its recoverable amount. The recoverable amount is calculated as the higher of fair value less
costs of disposal and value in use. For an asset that does not generate largely independent cash flows,
the recoverable amount is determined for the cash generating unit to which the asset belongs.
During the year, the customer contracts, relationships and distribution agreements were assessed for
impairment. As a result of that review, the asset related to the acquisition of IESA was fully impaired,
with an impairment cost of £10.9 million. In addition, £0.4 million of software acquired with IESA was
also impaired.
For the goodwill impairment reviews, the recoverable amount of the groups of CGUs are based on
value-in-use calculations, which use cash flow projections based on the Group’s annual targets and
strategic plan which cover the next five years. The strategic plan is also used as the basis for the
viability statement. When the strategic plan was prepared it considered current performance and made
assumptions about future revenue and gross margin growth rates determined using internal forecasts
based upon historical growth rates and future medium-term plans which consider, and are consistent
with, relevant macroeconomic indicators.
It also took into account expected increases in costs of products and overheads, including those related
to climate change as well as expected benefits from the expansion of the Group’s more sustainable
product range and ESG solutions business. The cash flows from the strategic plan are extrapolated using
the relevant long-term growth rate for the groups of CGUs and discounted at the Group’s externally
sourced pre-tax weighted average cost of capital adjusted for the estimated tax cash flows and risk
applicable for the groups of CGUs to estimate cash flow projections. These cash flow projections are
adjusted to take account of the likely future capital expenditure costs of meeting the Group’s climate
change commitments to be net zero in its direct operations by 2030 (expected to be c. £18 million over
the period to 2029/30) and are consistent with the Group’s climate scenario analysis of physical and
transition risk impacts conducted for the Task Force on Climate-related Financial Disclosures (TCFD).
For the Americas group of CGUs, the long-term growth rate is 2.5% (2023/24: 1.9%) which is consistent
with the market estimate of long-term average growth rates for the product and service solutions
providers industries and does not exceed expected long-term GDP growth for Americas. The nominal
pre-tax discount rate is 11.5% (2023/24: 11.9%).
For the EMEA group of CGUs, the long-term growth rate is 2.0% (2023/24: 1.5%) which is consistent with
the market estimate of long-term average growth rates for the product and service solutions providers’
industries and does not exceed expected long-term GDP growth for EMEA. The nominal pre-tax discount
rate is 11.2% (2023/24: 11.9%).
For the Asia Pacific group of CGUs, the long-term growth rate is 1.4% (2023/24: 2.0%) which is consistent
with the market estimate of long-term average growth rates for the product and service solutions
providers’ industries and does not exceed expected long-term GDP growth for Asia Pacific. The nominal
pre-tax discount rate is 15.9% (2023/24: 17.5%).
There is significant headroom between the carrying amount and the value in use of the groups of CGUs
and so the Directors believe that currently all reasonably likely changes in the key assumptions referred
to above would not give rise to an impairment charge.
RS Group plc Annual Report and Accounts 2025 171STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
15 Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and any provisions
for impairment after taking account of any impact of the Group’s strategy related to climate change.
The Group monitors property, plant and equipment throughout the year and tests for impairment if
events or changes in circumstances indicate that the carrying amount may not be recoverable. The cost
of self-constructed assets includes the cost of materials, direct labour and certain direct overheads.
No depreciation has been charged on freehold land. Other assets are depreciated to residual value,
which is reassessed annually, on a straight-line basis over the following useful lives: freehold buildings
and improvements to leasehold buildings 50 years (or the lease term if shorter); plant and machinery
5 – 20 years; and computer equipment 3 – 5 years. This reassessment of residual value includes
consideration of the Group’s climate scenario analysis of physical and transition risk impacts conducted
for the TCFD and there have been no significant changes in the year.
Land and
buildings
£m
Plant and
machinery
£m
Computer
equipment
£m
Total
£m
Cost
At 1 April 2023 163.7 241.8 67.0 472.5
Acquisitions – 0.4 0.2 0.6
Additions 2.7 10.1 2.8 15.6
Disposals (0.6) (2.8) (0.5) (3.9)
Reclassifications – 0.1 (0.1) –
Translation differences (2.7) (2.7) (0.7) (6.1)
At 31 March 2024 163.1 246.9 68.7 478.7
Acquisitions (Note 29) 0.1 1.7 – 1.8
Additions 0.9 13.2 1.8 15.9
Disposals (1.4) (6.3) (1.8) (9.5)
Reclassifications – (0.6) – (0.6)
Translation differences (2.7) (2.9) (0.6) (6.2)
At 31 March 2025 160.0 252.0 68.1 480.1
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
Land and
buildings
£m
Plant and
machinery
£m
Computer
equipment
£m
Total
£m
Depreciation
At 1 April 2023 60.8 164.5 60.9 286.2
Charge for the year 3.7 11.0 2.2 16.9
Disposals (0.5) (1.6) (0.5) (2.6)
Reclassifications – 0.1 (0.1) –
Translation differences (0.8) (1.3) (0.6) (2.7)
At 31 March 2024 63.2 172.7 61.9 297.8
Charge for the year 3.8 11.6 2.1 17.5
Disposals (1.3) (6.3) (1.8) (9.4)
Impairment losses 0.4 – – 0.4
Translation differences (0.9) (1.4) (0.6) (2.9)
At 31 March 2025 65.2 176.6 61.6 303.4
Net book value
At 31 March 2025 94.8 75.4 6.5 176.7
At 31 March 2024 99.9 74.2 6.8 180.9
Included above are £1.8 million of property, plant and equipment under construction at 31 March 2025
(2023/24: £5.9 million). During the year, £0.6 million was reclassified between plant and machinery
and software.
RS Group plc Annual Report and Accounts 2025172
The amounts recognised relating to leases were:
2025
£m
2024
£m
Right-of-use assets
Buildings 45.1 64.3
Plant and machinery 0.3 0.1
Computer equipment – –
Vehicles 8.9 8.4
Right-of-use assets 54.3 72.8
Lease liabilities
Current 15.5 16.0
Non-current 41.2 57.9
Lease liabilities 56.7 73.9
Depreciation charge for right-of-use assets
Buildings 12.8 13.3
Plant and machinery 0.1 0.1
Computer equipment – 1.3
Vehicles 4.3 3.9
Depreciation charge for right-of-use assets 17.2 18.6
Additions to right-of-use assets
Right-of-use assets acquired with businesses 2.4 29.8
Other additions to right-of-use assets 5.9 8.4
Additions to right-of-use assets 8.3 38.2
16 Leases
The Group assesses at the inception of a contract whether the contract is, or contains, a lease.
Where it conveys the right to control the use of an identified asset for a period of time in exchange
for consideration, the contract is deemed to be, or to include, a lease. The Group leases various
properties, plant and machinery, computer equipment and vehicles typically for periods between 2 and
20 years. Where a contract includes a vehicle lease, the Group has elected to account for the non-lease
components as part of the lease. Where the Group determines, at the commencement date of each
lease, that it is reasonably certain to exercise an option to extend the lease or not to exercise an option
to terminate the lease, the additional period is included within the lease term.
Leases are recognised on the balance sheet at their commencement date as a liability representing the
present value of the future lease payments not yet paid and a right-of-use asset reflecting the future
benefit to the Group generated by using the underlying asset. The discount on the lease liability is
calculated using the Group’s incremental borrowing rate, as rates implicit in the Group’s leases cannot be
readily determined, and is charged to finance costs in the income statement as it unwinds. The Group’s
incremental borrowing rate is adjusted to take account of the country risk, lease term and start date
for each lease. Fixed payments less any lease incentives receivable, in-substance fixed payments and
variable payments based on an index or rate form part of the lease liability. Variable payments which are
not based on an index or rate are expensed when the event that triggers the payment occurs.
The right-of-use asset is stated at cost less accumulated depreciation and any provisions for impairment.
Initially the cost of the right-of-use asset comprises the initial amount of the lease liability adjusted for
any lease payments made at or before commencement of the lease less any lease incentives received,
plus any direct costs incurred and an estimate of the cost to restore the underlying asset. The right-of-
use asset is depreciated on a straight-line basis over the lease term (or useful life of the asset, if shorter),
which is reassessed as the underlying facts and circumstances of the lease change.
The Group has elected to not recognise the lease liability and right-of-use asset in respect of short-term
leases and leases of low-value assets on the balance sheet. Short-term leases and leases of low-value
assets are expensed in the income statement on a straight-line basis over the lease term.
The lease liability is remeasured when there is a change in the future lease payments or if the Group
changes its assessment of whether it will exercise an extension or termination option. When the lease
liability is remeasured in this way, a corresponding adjustment is made to the carrying value of the right-
of-use asset. If the carrying value of the right-of-use asset is reduced to zero, any further reductions are
recognised in the income statement.
When the Group is an intermediate lessor, it accounts for the head lease and the sublease as two
separate contracts. The sublease is classified as an operating lease by reference to the right-of-use asset
arising from the head lease. Rental income from operating leases is recognised on a straight-line basis
over the term of the relevant lease.
RS Group plc Annual Report and Accounts 2025 173STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
18 Inventories
Inventories are valued at the lower of cost and net realisable value. Cost is calculated on a weighted
average basis and for finished goods and goods for resale includes attributable overheads.
The Group estimates the net realisable value of inventories in order to determine the value of any
provision required. In this estimation judgements, including any impact of obsolescence including that
related to regulatory changes due to, amongst other things, climate change, are made in relation to the
number of years of sales there are in inventories of each product and the value recoverable from those
inventories. In determining the recoverable value, judgement is taken about the ability of the Group to
return a proportion of stock to suppliers under supplier specific contractual provisions. The Group bases
its estimates on recent historical experience and knowledge of the products on hand and the terms
of contractual arrangements with suppliers. Should more or less inventory be able to be returned to
suppliers than planned, there would be a consequential impact on the inventory provision.
2025
£m
2024
restated
1
£m
2023
restated
1
£m
Raw materials and consumables 97.6 111.0 96.6
Finished goods and goods for resale 606.5 613.3 563.1
Gross inventories 704.1 724.3 659.7
Inventory provisions (86.8) (86.9) (56.6)
Net inventories 617.3 637.4 603.1
1. Please refer to Note 32 for further details of the restatement.
Sensitivity analysis of the impact of changes in key assumptions
If the numbers of each product sold in a year decreased, leading to an increase of one year in the
number of years of sales there are in inventory, inventory provisions would increase by £6.7 million
(2023/24 restated: £8.6 million). If the numbers of each product sold in a year increased leading to a
decrease of one year in the number of years of sales there are in inventory, inventory provisions would
decrease by £3.2 million (2023/24 restated: £3.8 million). A reduction in the value recoverable leading
to an increase in provision rates of 10%, up to a maximum of 100% provision per product, would
increase the inventory provisions by £2.7 million (2023/24 restated: £4.2 million). An increase in the value
recoverable leading to a decrease in provision rates of 10% would decrease the inventory provisions by
£8.6 million (2023/24 restated: £7.5 million).
16 Leases continued
2025
£m
2024
£m
Total cash outflow/(inflow) for leases
Included in cash flows from operating activities:
Interest expense 2.8 2.9
Expense relating to short-term leases 0.8 1.1
Expense relating to leases of low-value assets, excluding short-term leases of
low-value assets
0.3 0.4
Expense relating to variable lease payments not included in measurement of
lease liabilities
2.0 0.9
Income from sub-leasing right-of-use assets (0.4) (1.8)
Included in cash flows from financing activities:
Principal elements of lease payments 15.7 18.5
Total cash outflow for leases 21.2 22.0
Right-of-use asset disposals of £16.8 million (2023/24: £0.2 million) were recognised in the year
The interest expense on lease liabilities recognised in the income statement was £2.8 million
(2023/24: £2.9 million). Potential future cash outflows that are not reflected in the measurement
of lease liabilities were not material.
The contractual maturity analysis of lease liabilities is included in liquidity risk in Note 23.
17 Investment in joint venture
The Group’s share of the post-tax profit of its joint venture is included in profit before tax. The investment
in the joint venture is carried in the Group balance sheet at historical cost plus post-acquisition changes
in the Group’s share of the joint venture’s net assets. The Group owns 50% of the share capital of RS
Components & Controls (India) Limited, its joint venture.
2025
£m
2024
£m
At 1 April 1.3 1.5
Group’s share of profit for the year 0.6 0.6
Group’s share of other comprehensive expense (0.1) (0.2)
Group’s share of total comprehensive income 0.5 0.4
Dividends (0.6) (0.6)
At 31 March 1.2 1.3
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
RS Group plc Annual Report and Accounts 2025174
20 Trade and other payables
2025
£m
2024
£m
Current
Trade payables 359.4 381.8
Other taxation and social security 41.2 40.7
Government grants 0.1 0.1
Cash-settled share-based payment liability 0.4 1.2
Accruals 165.2 133.0
Contract liabilities 3.9 4.4
Other payables (including estimated obligations for customer volume discounts and
refunds – Note 4)
40.8 41.5
Current trade and other payables 611.0 602.7
Non-current
Government grants 2.0 2.2
Cash-settled share-based payment liability 0.6 2.4
Other employee benefits 3.1 3.8
Accruals – 0.1
Other payables 1.7 8.8
Non-current other payables 7.4 17.3
Contract liabilities are where the Group has received payment but is yet to perform its part of the contract.
Government grants related to expenditure on property, plant and equipment are credited to the income
statement at the same rate as the depreciation on the asset to which the grant relates.
The Group offers a supply chain finance facility to its suppliers. This was set up when the Group worked
with suppliers to extend payment terms to protect its working capital position. It is primarily provided to
give suppliers the option to protect their own working capital position from the impact of this extension.
Judgement is required to assess the payables subject to these arrangements and whether they should
continue to be classified as trade payables and whether the cash flows should still be classified as
operating. The substance of the contractual terms with the bank providing the financing does not differ
from the terms under the supplier contracts. The standard payment terms under supplier contracts
are 60 days, with a maximum payment term of 180 days. As there are no changes to the invoice terms,
the amount owed to the bank is included in trade payables. Related cash flows are included in cash
generated from operations.
19 Trade and other receivables
2025
£m
2024
£m
Current
Gross trade receivables 615.9 624.0
Impairment allowance (Note 23) (11.5) (11.1)
Net trade receivables 604.4 612.9
Amounts owed by joint venture 1.3 1.5
Prepayments 44.5 43.9
Other taxation and social security 8.8 7.8
Contract assets 2.8 8.1
Other receivables 26.7 27.2
Current trade and other receivables 688.5 701.4
Non-current
Prepayments 0.1 0.1
Other receivables 4.5 8.3
Non-current other receivables 4.6 8.4
Contract assets relate mainly to licence fee income and are where the Group has performed its part of
the contract for that element but other performance obligations are required to be completed before it
can receive the credit note for licence fee income from suppliers or raise the invoice for other contracts
with customers.
Current other receivables include £8.1 million (2023/24: £7.9 million) for amounts yet to be invoiced
to customers related to product sales where the Group acts as an agent (Note 4), expected inventory
returns and loans to employees. Non-current other receivables include insurance claims receivables and
lease deposits.
RS Group plc Annual Report and Accounts 2025 175STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Cash flow hedge accounting
The Group uses derivative financial instruments, namely forward foreign exchange contracts, to
hedge variability in cash flows of a recognised asset or liability, or a highly probable forecast transaction.
The effective part of any gain or loss on the derivative financial instrument is recognised in other
comprehensive income, while any ineffective part is recognised immediately in the income statement.
When the hedged item subsequently results in the recognition of a non-financial asset or liability
(e.g. inventories), the associated cumulative gain or loss recognised in the hedging reserve is transferred
to the initial carrying amount of the asset or liability. When the hedged item subsequently results in the
recognition of a financial asset or liability, the associated cumulative gain or loss that was recognised in
other comprehensive income is reclassified from equity to the income statement in the same period that
the hedged item affects the income statement.
When a hedging instrument expires or is sold, terminated or exercised, or the Group discontinues
hedge accounting as it no longer meets the Group’s risk management objective but the hedged forecast
transaction is still expected to occur, the cumulative gain or loss at that point remains in equity and is
reclassified from equity when the transaction occurs in accordance with the above policy. If the hedged
transaction is no longer expected to take place, the cumulative unrealised gain or loss recognised in
equity is reclassified to the income statement.
The fair value of forward foreign exchange contracts is the difference between their discounted
contractual forward price and their current forward price.
Net investment hedge accounting
The portion of the gain or loss on an instrument used to hedge a net investment in a foreign operation
that is determined to be an effective hedge is recognised in other comprehensive income. The ineffective
portion is recognised immediately in the income statement. Amounts taken to other comprehensive
income are reclassified from equity to the income statement when the foreign operations are sold
or liquidated.
Other financial instruments
All other financial instruments are initially recognised at fair value and adjusted by transaction costs.
Initial fair value is generally the transaction price. Subsequent measurement is as follows:
– Borrowings are measured at amortised cost. Options to extend the term of facilities are considered to
be loan commitments.
– All other financial assets, including current receivables, are measured at amortised cost less any
impairment allowances on the basis that these assets are held to collect all contractual cash flows
being principal and interest on the amount outstanding.
– All other financial liabilities, including current payables, are measured at amortised cost.
20 Trade and other payables continued
2025 2024
Carrying amount of the financial liabilities that are subject to supplier finance
arrangements (£m)
Presented within trade and other payables 14.7 14.1
- of which suppliers have received payment from the bank 0.3 N/A
Range of payment due dates (days after invoice date)
Trade payables subject to supplier finance arrangement Up to 180 N/A
Comparable trade payables Up to 180 N/A
The comparative information that is not required to be presented by the Group in the current year is
marked as “N/A” in the table.
Changes in liabilities that are subject to supplier finance arrangements are primarily attributable to
additions resulting from purchases of goods and services and subsequent cash settlements. There were
no material non-cash changes in these liabilities.
The Group does not face a significant liquidity risk as a result of its supplier finance arrangements given
the limited amount of liabilities subject to supplier finance arrangements and the Group’s access to other
sources of finance on similar terms.
21 Financial instruments
The Group uses derivative financial instruments, principally forward foreign exchange contracts and
occasionally currency swaps to cover its exposure to foreign exchange risk arising from operational and
financing activities.
In accordance with its treasury policies, the Group designates the majority of its derivative financial
instruments as cash flow hedges. The Group does not hold or issue derivative financial instruments for
trading purposes.
Derivatives are recognised at fair value. Derivative financial instruments that do not qualify for cash flow
hedge or net investment hedge accounting are classified as measured at fair value through profit or loss
(FVTPL) and changes in their fair values are recognised in the income statement as they arise.
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
RS Group plc Annual Report and Accounts 2025176
Fair values
Under IFRS 13 ‘Fair Value Measurement’, fair values are measured using a hierarchy where the
inputs are:
– Level 1 – quoted prices in active markets for identical assets or liabilities
– Level 2 – not Level 1 but are observable for that asset or liability either directly or indirectly
– Level 3 – not based on observable market data (unobservable)
The derivatives listed above are measured at fair value using Level 2 inputs, estimated by discounting
the future contractual cash flows using appropriate market-sourced data at the balance sheet date.
The overall valuation is classified as level 2 on the fair value hierarchy.
For all financial assets and liabilities, fair value approximates the carrying amounts in the balance sheet
except for the following:
2025 2024
Carrying
amounts
£m
Fair value
£m
Carrying
amounts
£m
Fair value
£m
Non-current private placement loan notes (153.2) (145.4) (157.1) (142.9)
The fair values are calculated by discounting future cash flows to net present values using prevailing
interest rate curves, a Level 2 input, and indicative values of the Group’s credit margin, a Level 3 input.
The overall valuation is classified as level 3 on the fair value hierarchy.
Classes and categories of financial instruments
2025
£m
2024
£m
Financial assets measured at amortised cost
Non-current other receivables 4.5 8.3
Cash and cash equivalents - cash and short-term deposits 147.7 258.7
Trade and other receivables 625.3 633.5
Financial assets mandatorily measured at FVTPL
Derivative financial instruments 0.1 0.2
Derivatives designated and effective as hedging instruments (fair value
movements through other comprehensive income)
Derivative financial instruments 1.8 2.4
Total financial assets 779.4 903.1
Financial liabilities measured at amortised cost
Non-current other payables (1.7) (8.9)
Cash and cash equivalents - bank overdrafts (41.7) (162.7)
Trade and other payables (504.4) (513.5)
Multicurrency revolving facility (112.6) (155.0)
Unsecured bank facility (23.5) –
Term loan (124.2) (128.2)
Private placement loan notes (153.2) (157.1)
Lease liabilities (56.7) (73.9)
Financial liabilities mandatorily measured at FVTPL
Derivative financial instruments (0.1) –
Derivatives designated and effective as hedging instruments (fair value
movements through other comprehensive income)
Derivative financial instruments (1.7) (1.1)
Total financial liabilities (1,019.8) (1,200.4)
RS Group plc Annual Report and Accounts 2025 177STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
21 Financial instruments continued
Derivatives
2025 2024
Current
assets
£m
Current
liabilities
£m
Current
assets
£m
Current
liabilities
£m
Forward foreign exchange contracts designated as cash flow
hedges (principal amount £150.5 million (2023/24: £225.3
million))
1.8 (1.7) 2.4 (1.1)
Forward foreign exchange contracts classified as fair value
through profit or loss
0.1 (0.1) 0.2 –
Derivatives 1.9 (1.8) 2.6 (1.1)
Netting arrangements for financial instruments
Financial assets and liabilities are offset and the net amount reported in the balance sheet where there is
a legally enforceable right to offset the recognised amounts, and there is an intention to settle on a net
basis or realise the asset and settle the liability simultaneously. The Group has no financial instruments
that meet the criteria for offsetting. Financial instruments that are subject to enforceable master netting
arrangements and other similar agreements but are not offset are shown in the table below.
Gross
and net
amounts
in balance
sheet
£m
Financial
instruments
not offset
£m
Net
amounts
£m
At 31 March 2025
Other derivative assets 1.9 (1.8) 0.1
Other derivative liabilities (1.8) 1.8 –
At 31 March 2024
Other derivative assets 2.6 (1.0) 1.6
Other derivative liabilities (1.1) 1.0 (0.1)
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
22 Net debt
2025
£m
2024
£m
Cash and short-term deposits 147.7 258.7
Bank overdrafts (unsecured) (41.7) (162.7)
Cash and cash equivalents 106.0 96.0
2025
£m
2024
£m
Non-current borrowings
Unsecured private placement loan notes repayable after more than five years (38.6) (78.4)
Unsecured private placement loan notes repayable from four to five years (37.8) –
Unsecured private placement loan notes repayable from two to three years – (78.7)
Unsecured private placement loan notes repayable from one to two years (76.8) –
Unsecured multicurrency revolving credit facility repayable from four to five years (112.6) (155.0)
Unsecured term loan repayable from three to four years (124.2) –
Unsecured term loan repayable from two to three years – (128.2)
Non-current borrowings (390.0) (440.3)
Current borrowings
Unsecured bank facility repayable within one year (23.5) –
Current borrowings (23.5) –
Total borrowings (413.5) (440.3)
Cash and cash equivalents 106.0 96.0
Non-current lease liabilities (41.2) (57.9)
Current lease liabilities (15.5) (16.0)
Net debt (364.2) (418.2)
See Note 3 for definition of net debt which is an APM. Cash and cash equivalents comprise cash in hand
and in current accounts, overnight deposits and short-term deposits of less than three months net of
overdrafts with qualifying financial institutions. Borrowings represent loans from qualifying financial
institutions. See Note 23 for details of the Group’s committed debt facilities.
Group accounts continued
RS Group plc Annual Report and Accounts 2025178
23 Financial risk management
The principal financial risks to which the Group is exposed are those of credit, liquidity and market.
Market risk includes foreign currency transaction risk and interest rate risk. Each of these is managed in
accordance with Board-approved policies.
Credit risk
The Group is exposed to credit risk on financial assets such as cash deposits, derivative instruments and
trade and other receivables.
The amounts in the balance sheet represent the maximum credit risk exposure at the balance sheet
date. There were no significant concentrations of credit risk at the balance sheet date, as exposure is
spread over a large number of counterparties, customers and geographic locations. The Group has
reviewed its credit risk again carefully this year due to the current global economic and geopolitical
uncertainties and the Group does not believe it has materially altered during the year.
For cash deposits and derivative instruments, the Group identifies counterparties of suitable
creditworthiness based on ratings assigned by international credit-rating agencies and has procedures
to ensure that only these parties are used, that exposure limits are set based on the external credit
ratings and that these limits are not exceeded. The impairment losses on these are immaterial.
The table below sets out the credit exposure to counterparties by rating for cash and cash equivalents
and derivatives.
The maximum exposure with a single bank for deposits was £22.7 million (2023/24: £12.6 million) and
the largest mark to market exposure for derivative financial instruments to a single bank was £0.2 million
(2023/24: £0.6 million). The Group also occasionally uses money market funds to invest surplus cash
thereby diversifying credit risk and at 31 March 2025 its exposure to these funds was £nil (2023/24: £nil).
Aaa
£m
Aa
£m
A
£m
Baa
£m
Ba1 and
below/
unrated
£m
Total
£m
Bank balances and deposits
– 98.1 46.0 0.8 2.8 147.7
Third party financial derivatives
– 1.0 0.9 – – 1.9
At 31 March 2025 – 99.1 46.9 0.8 2.8 149.6
Movements in net debt were:
Borrowings
£m
Lease
liabilities
£m
Total liabilities
from
financing
activities
£m
Cash
and cash
equivalents
£m
Net debt
£m
At 1 April 2023 (184.6) (48.9) (233.5) 120.5 (113.0)
Cash flows (259.4) 18.5 (240.9) (20.2) (261.1)
Acquired with businesses – (28.5) (28.5) – (28.5)
New leases – (8.4) (8.4) – (8.4)
Lease modifications – (7.3) (7.3) – (7.3)
Disposal of leases – 0.5 0.5 – 0.5
Translation differences 3.7 0.2 3.9 (4.3) (0.4)
At 31 March 2024 (440.3) (73.9) (514.2) 96.0 (418.2)
Cash flows 18.7 15.7 34.4 16.0 50.4
Acquired with businesses
– (2.3) (2.3) – (2.3)
New leases
– (5.9) (5.9) – (5.9)
Lease modifications
– (7.8) (7.8) – (7.8)
Disposal of leases
– 16.8 16.8 – 16.8
Translation differences
8.1 0.7 8.8 (6.0) 2.8
At 31 March 2025 (413.5) (56.7) (470.2) 106.0 (364.2)
RS Group plc Annual Report and Accounts 2025 179STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
23 Financial risk management continued
Aaa
£m
Aa
£m
A
£m
Baa
£m
Ba1 and
below/
unrated
£m
Total
£m
Bank balances and deposits
– 211.1 44.6 2.1 0.9 258.7
Third party financial derivatives
– 1.0 1.6 – – 2.6
At 31 March 2024 – 212.1 46.2 2.1 0.9 261.3
For trade and other receivables, all operating companies have credit policies and monitor their credit
exposure on an ongoing basis. Each operating company performs credit evaluations on all customers
seeking credit over a certain amount. For countries with no local operating company presence,
export credit limits are set and monitored on a country basis, monthly, by the Treasury Committee.
The impairment losses on contract assets, amounts owed by joint venture and other receivables
are immaterial.
The impairment allowance for trade receivables is measured at an amount equal to lifetime expected
credit losses. Trade receivables have been grouped based on shared credit risk characteristics and the
number of days from date of invoice. The expected loss rates are based on the payment profile of sales
over a 36-month period from 1 April 2021 and the corresponding historical credit losses experienced
within this period calculated as the trade receivables from this period that have not been paid by the
year end. The historical loss rates are adjusted to reflect current and forward-looking information on
macroeconomic factors affecting the ability of the customers to settle the receivables.
On that basis, the impairment allowance for trade receivables was determined as follows:
2025 2024
Expected
loss rate
%
Gross
carrying
amount
£m
Loss
allowance
£m
Expected
loss rate
%
Gross
carrying
amount
£m
Loss
allowance
£m
0 - 30 days from date of invoice 0.7% 348.6 2.3 1.0% 339.4 3.5
31 - 60 days from date of invoice 0.6% 162.0 1.0 1.2% 174.0 2.1
61 - 90 days from date of invoice 1.4% 50.8 0.7 1.8% 51.1 0.9
91 - 120 days from date of invoice 3.3% 18.4 0.6 3.0% 16.6 0.5
Over 120 days from date of invoice 19.1% 36.1 6.9 9.6% 42.9 4.1
Total 615.9 11.5 624.0 11.1
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
The ageing of net trade receivables at the reporting date was:
2025
£m
2024
£m
Not past due 469.2 487.2
Past due 1 - 30 days 73.3 71.8
Past due 31 - 60 days 26.5 18.6
Past due 61 - 120 days 14.3 10.1
Past due over 120 days 21.1 25.2
Total 604.4 612.9
The movement in the impairment allowance for trade receivables was as follows:
2025
£m
2024
£m
At 1 April (11.1) (12.6)
Acquisitions – (0.8)
Trade receivables written off 3.5 5.6
Increase in impairment allowance recognised in profit or loss (4.2) (3.4)
Translation differences 0.3 0.1
At 31 March (11.5) (11.1)
Trade receivables are written off when there is no reasonable expectation of recovery, for example
when a customer enters liquidation or the Group agrees with the customer to write off an outstanding
invoice. The Group continues to limit its exposure through tight credit policies, proactive monitoring
and collections. Historically, the Group has generally experienced very low levels of trade receivables
not being recovered, including those significantly past due, and this was also the case during 2024/25.
However, with the continued global economic and geopolitical uncertainties, the Group remains cautious
about its exposure and so has reviewed carefully, and maintained at a higher level, its expected loss rates
for those markets and industries that are most affected.
At 31 March 2025, the largest trade receivable balance was £15.5 million (2023/24: £13.5 million), of
which £11.0 million has been received since the year end.
Group accounts continued
RS Group plc Annual Report and Accounts 2025180
The contractual maturities of financial liabilities, including contractual future interest payments were:
Carrying
amounts
£m
Contractual
cash flows
£m
Within
1 year
£m
1-2
years
£m
2-3
years
£m
3-4
years
£m
After
4 years
£m
Derivative financial
liabilities
Inflows for forward foreign
exchange contracts
N/A 161.7 161.7 – – – –
Outflows for forward
foreign exchange contracts
N/A (163.2) (163.2) – – – –
Forward foreign exchange
contracts
(1.8) (1.5) (1.5) – – – –
Non-derivative financial
liabilities
Multicurrency revolving
credit facility
(112.6) (134.7) (4.8) (4.8) (4.8) (4.8) (115.5)
Unsecured bank facility (23.5) (24.0) (24.0) – – – –
Term loan (124.2) (141.8) (4.5) (4.5) (4.5) (128.3) –
Private placement loan
notes
(153.2) (171.9) (4.8) (81.0) (2.5) (2.5) (81.1)
Lease liabilities (56.7) (67.2) (17.9) (14.8) (9.0) (6.2) (19.3)
Bank overdrafts (41.7) (41.7) (41.7) – – – –
Trade payables, other
payables and accruals
(504.1) (504.1) (500.6) (3.5) – – –
At 31 March 2025 (1,017.8) (1,086.9) (599.8) (108.6) (20.8) (141.8) (215.9)
Liquidity risk
The Group’s key priority is to ensure that it can meet its liabilities as they fall due. The Group ensures
this by having sufficient committed debt facilities in place to meet its anticipated funding requirements.
The Group’s forecast funding requirements and its committed debt facilities are reported to and
monitored by the Treasury Committee monthly.
During the year, the Group’s request to take up the remaining one-year term extension to the
multicurrency revolving credit facility was approved by the lenders and therefore, as at 31 March 2025,
the Group had the following committed debt finance in place:
– Private placement loan notes of €18 million with a maturity of October 2026, US$80 million with
a maturity of December 2026, €13 million with a maturity of October 2029, US$35 million with a
maturity of March 2030 and US$50 million with a maturity of October 2031.
– A £400 million multicurrency revolving credit facility, with an accordion of up to a further £100 million,
with a maturity of October 2029. Amounts borrowed under this facility are borrowed for fixed amounts
of time after which they can be repaid or rolled up to a maximum of the facility maturity.
– A €150 million term loan previously repayable by April 2026. During the year the loan was extended on
similar terms and is now repayable by October 2028.
As at 31 March 2025, the Group had £287.4 million (2023/24: £245.0 million) of available undrawn
committed debt facilities in respect of which all conditions precedent had been met.
The Group also uses bank overdrafts, uncommitted short-term money market loans, cash and short-
term investments. The main purpose of these financial instruments is to manage the Group’s day-to-day
funding and liquidity requirements.
RS Group plc Annual Report and Accounts 2025 181STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
23 Financial risk management continued
Carrying
amounts
£m
Contractual
cash flows
£m
Within
1 year
£m
1-2
years
£m
2-3
years
£m
3-4
years
£m
After 4
years
£m
Derivative financial
liabilities
Inflows for forward foreign
exchange contracts
N/A 150.5 150.5 – – – –
Outflows for forward
foreign exchange contracts
N/A (151.7) (151.7) – – – –
Forward foreign exchange
contracts
(1.1) (1.2) (1.2) – – – –
Non-derivative financial
liabilities
Multicurrency revolving
credit facility
(155.0) (163.5) (77.8) (74.3) (11.4) – –
Term loan (128.2) (142.0) (6.6) (6.6) (128.8) – –
Private placement loan
notes
(157.1) (182.4) (4.9) (4.9) (83.6) (2.6) (86.4)
Lease liabilities (73.9) (89.6) (19.0) (15.8) (12.8) (7.4) (34.6)
Bank overdrafts (162.7) (162.7) (162.7) – – – –
Trade payables, other
payables and accruals
(519.1) (519.1) (507.7) (3.0) (8.4) – –
At 31 March 2024 (1,197.1) (1,260.5) (779.9) (104.6) (245.0) (10.0) (121.0)
Market risk – foreign currency transaction risk
The Group is exposed to foreign currency transaction risk as it has operating companies with payables
and receivables in currencies other than their functional currency. The Group also has foreign currency
translation risk resulting from investment in foreign subsidiaries and foreign currency debt which is
mainly in US dollars and euros.
Hedging of currency exposures during periods when operating companies cannot easily change their
selling prices is implemented in order to shelter the forecast gross profit during those periods. In this
way the impacts of currency fluctuations can be smoothed until selling prices can be changed in the light
of movements in exchange rates. The hedges are enacted through forward foreign exchange contracts
entered into by Group Treasury in appropriate currencies based on trading projections provided by the
operating companies with fixed terms mainly of between three and seven months and occasionally out
to 11 months for some more certain US dollar trading projections. The Group’s largest exposures relate
to euros and US dollars.
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
In addition, specific cash flows relating to material transactions in currencies other than the functional
currency of the local business are hedged when the commitment is made.
As of 31 March 2025, net transactions of £77 million and £40 million were hedged for EUR/GBP and
USD/GBP respectively.
The Group classifies forward foreign exchange contracts as hedging instruments against forecast cash
receipts and payments for sales and purchases and designates the forward element of these contracts
as cash flow hedges for accounting purposes on a 1:1 basis which means the fair value movement in the
hedged item is equal and opposite to the fair value movement in the hedging instrument. The forecast
cash flows are expected to occur evenly throughout the forecast period from the year end, which is
between three and 11 months, and will affect the income statement in the period in which they occur
or the inventories are sold. The average forward prices of the outstanding forward foreign exchange
contracts are €1.16:£1 and US$1.27:£1 (2023/24: €1.17:£1 and US$1.26:£1).
Foreign currency transaction exposures, and the hedges in place to mitigate them, are monitored
monthly by the Treasury Committee. The Group does not believe its foreign currency transaction risk
has altered materially during the year. Ineffectiveness may arise if actual foreign currency transactions
are lower than the trading projections. There may also be hedge ineffectiveness from the effect of
the counterparty and Group’s own credit risk on the fair value of forward contracts, which is not
reflected in the fair value of the hedged item attributable to changes in foreign exchange rates, or
basis risk or from the timing of transaction. No other sources of ineffectiveness emerged from these
hedging relationships.
The Group has designated the US$165 million private placement loan notes (2023/24: US$165 million),
with a carrying amount of £127.3 million (2023/24: £130.5 million), as hedges of US$165 million
(2023/24: US$165 million) of net investments in its US dollar functional currency subsidiaries. The Group
has designated the €181 million of private placement loan notes and term loan (2023/24: €181 million),
with a carrying amount of £150.1 million (2023/24: £154.8 million), as hedges of €181 million
(2023/24: €181 million) of net investments in its euro functional currency subsidiaries. These hedges
are expected to remain highly effective as the change in the value of the net assets of the subsidiaries
hedged is always exactly offset by the related change in the fair value of the private placement loan
notes and term loan. No other foreign currency translation exposures are explicitly hedged although
local currency debt is used where economically and fiscally efficient in the financing of subsidiaries and
this provides a degree of natural hedging. Guidelines are in place to manage the currency mix of the
Group’s net debt. The Group does not believe its foreign currency translation risk has altered materially
during the year. The balance in the cumulative translation reserve relating to the US$165 million and
€181 million net investment hedges is a gain of £13.7 million (2023/24: £7.1 million) with a further loss
of £36.7 million (2023/24: £36.7 million) relating to previous net investment hedging relationships.
During the year to 31 March 2025 a gain of £6.6 million was recognised in OCI.
Group accounts continued
RS Group plc Annual Report and Accounts 2025182
Sensitivity analysis of exposure to interest rates and foreign exchange rates
The sensitivity analysis is based on the following:
– Change of one percentage point in market interest rates affecting all variable rate elements of
financial instruments.
– Change of 5% in euro and US dollar exchange rates affecting the fair value of derivative financial
instruments designated as hedging instruments and other financial assets and liabilities.
The transactional foreign exchange effect in equity due to net investment hedges included below would
be offset in full by the translation of the US and European subsidiaries.
2025 2024
Impact on
income
statement
gain/(loss)
£m
Impact on
equity gain/
(loss)
£m
Impact on
income
statement
gain/(loss)
£m
Impact on
equity gain/
(loss)
£m
One percentage point increase in interest rates (1.6) – (1.9) –
5% weakening of the euro 1.5 5.5 1.1 5.4
5% weakening of the US dollar (1.9) 12.1 (2.1) 10.0
A corresponding decrease in interest rates or strengthening of exchange rates would result in an equal
and opposite effect to the amounts above.
Capital management
The Board’s policy is to maintain a strong capital base always, with an appropriate debt to equity mix, to
ensure investor, creditor and market confidence and to support the future development of the business.
The Board monitors ROCE (Note 3) and the level of dividends to ordinary shareholders.
The Group seeks to raise debt from a variety of sources and with a variety of maturities. See Note 22 for
further details.
The Group’s debt covenants are net debt to adjusted EBITDA to be less than 3.25 times and EBITA to
interest to be greater than 3 times, which are measured on a rolling 12-month basis at half year and year
end. At the year end the Group comfortably met these covenants with net debt to adjusted EBITDA of
1.1x (2023/24 restated: 1.2x) and EBITA to interest of 10.9x (2023/24 restated: 10.3x).
There were no significant changes in the Group’s approach to capital management during the year.
Borrowings are analysed by currency as:
At 31 March 2025
Bank
overdrafts
£m
Bank
facility
£m
Term loan
£m
Multicurrency
revolving
credit facility
£m
Private
placement
loan notes
£m
Total
£m
Sterling (22.0) – – (50.0) – (72.0)
US dollar (5.6) – – – (127.3) (132.9)
Euro (8.0) – (124.2) (62.6) (25.9) (220.7)
Canadian dollar (4.0) – – – – (4.0)
Other (2.1) (23.5) – – – (25.6)
Total borrowings (41.7) (23.5) (124.2) (112.6) (153.2) (455.2)
At 31 March 2024
Bank
overdrafts
£m
Bank
facility
£m
Term loan
£m
Multicurrency
revolving
credit facility
£m
Private
placement
loan notes
£m
Total
£m
Sterling (94.1) – – (155.0) – (249.1)
US dollar (26.4) – – – (130.5) (156.9)
Euro (28.5) – (128.2) – (26.6) (183.3)
Canadian dollar (8.3) – – – – (8.3)
Other (5.4) – – – – (5.4)
Total borrowings (162.7) – (128.2) (155.0) (157.1) (603.0)
Market risk – interest rate risk
The Group’s policy dictates regular monitoring of interest rate exposure with a view to taking suitable
actions should exposure reach certain levels.
As at 31 March 2025 (and 31 March 2024), the Group had US$165 million and €31 million of
private placement loan notes at fixed interest rates. All other borrowings were at variable rates.
At 31 March 2025, 34% (2023/24: 26%) of the Group’s gross borrowings excluding lease liabilities
(total borrowings plus bank overdrafts) were at fixed rates, with surplus cash deposited at variable rates.
RS Group plc Annual Report and Accounts 2025 183STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
24 Provisions and contingent liabilities
Provisions are recognised when the Group has a present obligation as a result of a past event and a
reasonable estimate can be made of a probable adverse outcome. Otherwise, material contingent
liabilities are disclosed unless the transfer of economic benefits is remote.
Reorganisation
provision
£m
Penalties
and interest
on uncertain
income tax
provision
£m
Dilapidation
provision
£m
Total
£m
At 1 April 2024 3.6 3.0 2.6 9.2
Acquisitions (Note 29) – – 0.1 0.1
Additions 9.6 0.1 0.5 10.2
Utilised (8.3) – – (8.3)
Released (1.1) (1.0) (0.8) (2.9)
Translation differences – (0.2) – (0.2)
At 31 March 2025 3.8 1.9 2.4 8.1
Analysed in the balance sheet as:
2025
£m
2024
£m
Current 5.0 5.0
Non-current 3.1 4.2
8.1 9.2
Provisions for uncertain tax positions are recognised in current tax liabilities, with relevant penalties
and interest recognised in provisions, see Note 11. The reorganisation provision is expected to be fully
utilised by March 2027 and the dilapidation provision is expected to be fully utilised by March 2028.
At 31 March 2025, there were no material contingent liabilities (2023/24: none).
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
25 Capital commitments
As at 31 March 2025, the Group is contractually committed to, but has not provided for, future capital
expenditure of £12.9 million (2023/24: £8.0 million) for property, plant and equipment and £4.5 million
(2023/24: £4.6 million) for intangible assets.
26 Share capital and share premium
Number of shares
Share
capital
£m
Share
premium
£m
Total
£m
Issued and fully paid ordinary shares of 10p each:
At 1 April 2023 472,784,409 47.3 236.0 283.3
Issues to settle employee share awards 1,227,903 0.1 3.5 3.6
At 31 March 2024 474,012,312 47.4 239.5 286.9
Issues to settle employee share awards 37,156 – 0.2 0.2
At 31 March 2025 474,049,468 47.4 239.7 287.1
The EBT buys shares on the open market and holds them in trust for employees participating in
the Group’s share-based payment schemes. At 31 March 2025, the EBT held 5,538,418 shares
(2023/24: 343,147 shares) which had not yet vested unconditionally with employees.
Group accounts continued
RS Group plc Annual Report and Accounts 2025184
28 Related parties
The Group’s joint venture (Note 17) is a related party and during the year, the Group made
sales of £4.4 million (2023/24: £4.0 million) to the joint venture, and a balance of £1.3 million
(2023/24: £1.5 million) was outstanding at the year end.
The Group’s pension schemes are related parties and the Group’s transactions with them are disclosed
in Note 10. Transactions and balances between the Company and its subsidiaries have been eliminated
on consolidation.
The key management personnel of the Group are the Directors and the Senior Management Team/
Executive Committee, whose compensation was:
2025
£m
2024
£m
Short-term employee benefits 9.5 6.1
Post-employment benefits 0.1 0.1
Termination benefits 0.4 0.6
Share-based payments 1.4 1.1
11.4 7.9
29 Acquisitions
On 2 April 2024 the Group acquired 100% of the issued share capital of Trident Australia Pty Ltd, a
specialist MRO distribution and rental, calibration and mechanical services partner for the energy and
natural resources industry in Australia. Trident adds to the Group’s Australian presence by increasing
the Group’s access to the energy and natural resources sector with associated customer and product
synergies and provides distribution infrastructure and service capacity in Western Australia. The goodwill
is attributable to the revenue synergies which are expected to arise from combining Trident’s established
presence in Western Australia and its highly specialised services for customers in the energy sector with
the Group’s global customer base and range of complementary products.
27 Other reserves
Hedging
reserve
£m
Cumulative
translation
reserve
£m
Total
£m
At 1 April 2023 (as reported) (0.5) 109.3 108.8
Effect of prior period restatement (Note 32) – 0.3 0.3
At 1 April 2023 (restated
1
) (0.5) 109.6 109.1
Foreign exchange translation differences (restated
1
) – (3.7) (3.7)
Fair value gain on net investment hedges (Note 23) – 3.4 3.4
Cash flow hedging gains taken to equity 1.3 – 1.3
Cash flow hedging gains transferred to cost of sales (1.4) – (1.4)
Total comprehensive expense (restated
1
) (0.1) (0.3) (0.4)
Cash flow hedging gains transferred to inventories (1.6) – (1.6)
Tax on cash flow hedging transferred to inventories 0.4 – 0.4
Cash flow hedging losses transferred to acquisition purchase price 1.8 – 1.8
Tax on cash flow hedging transferred to acquisition purchase price (0.4) – (0.4)
At 31 March 2024 (restated
1
) (0.4) 109.3 108.9
Foreign exchange translation differences – (84.2) (84.2)
Fair value gain on net investment hedges (Note 23) – 6.6 6.6
Cash flow hedging gains taken to equity (5.6) – (5.6)
Cash flow hedging gains transferred to cost of sales 7.0 – 7.0
Tax on other comprehensive income (Note 11) (0.2) – (0.2)
Total comprehensive income/(expense) 1.2 (77.6) (76.4)
Cash flow hedging gains transferred to inventories (0.6) – (0.6)
Tax on cash flow hedging transferred to inventories 0.1 – 0.1
At 31 March 2025 0.3 31.7 32.0
1. Please refer to Note 32 for further details of the restatement.
RS Group plc Annual Report and Accounts 2025 185STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
29 Acquisitions continued
The fair value of the net assets acquired, consideration and goodwill arising, plus transaction costs and
contribution to the Group’s results since acquisition were:
£m
Intangible assets - customer relationships 0.5
Property, plant and equipment 1.8
Right-of-use assets 2.4
Inventories (gross £2.0 million less provisions of £1.3 million) 0.7
Current trade and other receivables 1.8
Current trade and other payables (1.1)
Current lease liabilities (0.3)
Non-current lease liabilities (2.0)
Non-current other provisions (0.1)
Current income tax liabilities (0.1)
Deferred tax liabilities (0.8)
Net assets acquired 2.8
Goodwill 5.9
Consideration paid – cash 8.2
Contingent consideration payable – accrued 0.5
Total consideration 8.7
Acquisition-related costs charged to administrative expenses:
In 2024/25 0.2
In 2023/24 0.2
Revenue since acquisition 8.5
Profit after tax since acquisition 0.2
Trade and other receivables:
Gross contractual amounts receivable 1.8
Estimate of amounts not expected to be collected –
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
The goodwill will not be deductible for tax purposes. The contingent consideration was due 12 months
after the completion date and was based on revenue in the period January to December 2024 with a
range of £nil to £0.9 million. The conditions for payment were partially met and on 10 March 2025 the
contingent consideration payable was settled for £0.2 million.
Acquisition-related costs charged to administration expenses of £0.2 million included retention bonuses
of £0.5 million and the release of £0.3 million of accrued contingent consideration payable. See Note 3.
If the acquisition had occurred on 1 April 2024, the Group’s revenue and profit for the year ended
31 March 2025 would have been unchanged.
Group accounts continued
RS Group plc Annual Report and Accounts 2025186
Name and registered address of undertaking Country of incorporation Class of share held
Risoul Dominicana S.R.L*
Autopista Duarte KM 17, Calle Los Almejos, Palma Enana
No 13, Nave 1, Villa Linda, Palmarejito, Santo Domingo Oeste,
Dominican Republic Dominican Republic Ordinary
Elfa Distrelec OÜ*
Hobujaama 4, Tallinn 10151, Estonia Estonia Ordinary
Elfa Distrelec Oy*
Bertel Jungin Aukio 5, FI-02600, Finland Finland Ordinary
RS Components SAS*
Rue Norman King, 60000, Beauvais, France France Ordinary
RS Integrated Supply France*
Rue Norman King BF 453, F-60031 Beauvais Cedex, France France Ordinary
Distrelec Deutschland GmbH*
Schellackstrasse 1, 28217 Bremen Germany Ordinary
RS Components GmbH*
Mainzer Landstraße 180, 60327, Frankfurt, Germany Germany Ordinary
RS Integrated Supply Deutschland GmbH*
Bleibtreustr. 21, 10623, Berlin, Germany Germany Ordinary
RS Integrated Supply Hungary Korlátolt
Felelősségű Társaság*
1062, 1-3. Tower A, 6th floor, Budapest, Hungary Hungary Ordinary
RS Components & Controls (India) Limited*†
222 Okhla Industrial Estate, New Delhi, India India Ordinary
RS Components S.r.l.*
Sesto san Giovanni, Viale Thomas Alva Edison,
110, 20099, MI, Italy Italy Ordinary
RS Integrated Supply Italy S.r.l.*
Sesto san Giovanni, Viale Thomas Alva Edison,
110, 20099, MI, Italy Italy Ordinary
RS Components KK*
West Tower 12F, Yokohama Business Park, 134 Godocho,
Hodogaya, Yokohama, Kanagawa, 240-0005, Japan Japan Ordinary
30 Related undertakings
A full list of related undertakings (comprising subsidiaries and a joint venture) is set out below.
All subsidiaries are wholly owned except where indicated below and operate within their countries of
incorporation. Those companies marked with an asterisk (*) are indirectly held by the Company.
Name and registered address of undertaking Country of incorporation Class of share held
Distributor of product and service solutions
RS Components Pty Limited*
25, Pavesi Street, Smithfield, Sydney NSW 2164, Australia Australia Ordinary
Trident Australia Pty Limited*
25, Pavesi Street, Smithfield, Sydney NSW 2164, Australia Australia Ordinary
Distrelec Gesellschaft m.b.H.*
Jagdgasse 25, 1100, Wien, Austria Austria Ordinary
RS Components Handelsgesellschaft m.b.H*
Albrechtser Straße 11, 3950, Gmünd, Austria Austria Share of equity
RS Integrated Supply Belgium*
Louizalaan 65/11, 1050 Elsene, Belgium Belgium Ordinary
RS Americas (Canada), Inc.*
1155 Lola Street, Unit 6, Ottawa, ON, K1K 4C1, Canada Canada Common
RS Integrated Supply Canada Corp.*
600-1741 Lower Waters Street, Halifax, NS, B3J 0J2, Canada Canada Common
RS Group Limitada (DBA - RS Limitada)*
Av. Eduardo Frei Montalva, 6001-71 Conchali, Santiago, Chile Chile Ordinary
RS Components Limited*
4/F, VC House, 4-6 On Lan Street, Central, Hong Kong China Ordinary
RS Components (Shanghai) Company Limited*
East Part, 2 Floor, No.27 building, No.30, Fu Te East Third Road
China (Shanghai) Pilot Free Trade Zone China Ordinary
Elfa Distrelec A/S*
Haslegårdsvej 8-12, 8210 Aarhus V, Denmark Denmark Ordinary
RS Components A/S*
Nattergalevej 6, 2400, København NV, Denmark Denmark Ordinary
† Note 17 provides details about the Company’s interest in the joint venture.
RS Group plc Annual Report and Accounts 2025 187STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Name and registered address of undertaking Country of incorporation Class of share held
RS Components Corporation*
Philippines
Common and
preference
21st Floor Multinational Bancorporation Centre,
6805 Ayala Avenue, Makati City, Philippines
Elfa Distrelec Sp. z.o.o*
Ul. Domaniewska 48, 02-672, Warszawa, Poland Poland Ordinary
RS Components sp. z.o.o.*
Ul. Domaniewska 48, 02-672, Warszawa, Poland Poland Ordinary
RS Integrated Supply Poland Sp. z.o.o.*
Ul. Domaniewska 48, 02-672, Warszawa, Poland Poland Ordinary
Radionics Limited*
Glenview Industrial Estate, Herberton Road, Rialto,
Dublin 12, Ireland Republic of Ireland Ordinary
RS Integrated Supply Ireland Limited*
Glenview Industrial Estate, Herberton Road, Rialto,
Dublin 12, Ireland Republic of Ireland Ordinary
Synovos Ireland Limited*
70 Sir John Rogerson’s Quay, Dublin 2, Ireland Republic of Ireland Ordinary
RS Components Pte Ltd*
133 Cecil Street, #14-01, Keck Seng Tower, Singapore Singapore Ordinary
RS Integrated Supply Singapore Pte. Ltd.*
10 Ubi Crescent, #06-18 Ubi Techpark, 408564, Singapore Singapore Ordinary
Synovos Singapore Pte. Ltd.*
1 Marina Boulevard, #28-00, One Marina Boulevard,
018989, Singapore Singapore Ordinary
RS Integrated Supply Slovakia s.r.o.*
Landererova 12, Bratislava - mestská časť Staré Mesto,
81109, Slovakia Slovakia Ordinary
Amidata S.A.U.*
Avenida de Bruselas 6, Alcobendas, 28108, Madrid, Spain Spain Ordinary
Risoul Iberica SA*
08402 - Granollers, calle Girona, numero 85, Barcelona, Spain Spain Ordinary
Elfa Distrelec AB*
Kronborgsgränd 1, 164 46 Kista, Sweden Sweden Ordinary
Name and registered address of undertaking Country of incorporation Class of share held
Elfa Distrelec SIA*
Krišjāņa Valdemāra iela 62, Rīga LV 1013, Latvia Latvia Ordinary
Elfa Distrelec, UAB*
Ukmergės g. 219, LT-07152 Vilnius, Lithuania Lithuania Ordinary
RS Components Sdn. Bhd.*
Suite 9D, Level 9, Menara Ansar, 65 Jalan Trus,
Johor Bahru, 80000, Johor, Malaysia Malaysia Ordinary
Allied Electronics & Automation S. de R.L. de C.V.*
Avenida Circunvalación Agustin Yalez N° 2613 Int. 1A 105,
Colonia Arcos Vallarta Sur, Guadalajara Jalisco, 44500, Mexico Mexico Ordinary
Risoul y Cia, S.A. de C.V.*
Avenida Sendero Divisorio 400, Residencia Casa Bella,
San Nicolas de los Garza, Nuevo Leon, 66428, Mexico Mexico Ordinary
RS Custom Order Solutions, S.A. de C.V.*
Avenida Sendero Divisorio 400, Residencia Casa Bella,
San Nicolas de los Garza, Nuevo Leon, 66428, Mexico Mexico Ordinary
Storeroom Solutions Mexico, S. de R.L. de C.V.*
Florencia 57 P, 3 Juarez Distritio Federal, 06600, Mexico Mexico Ordinary
Distrelec B.V.*
De Tweeling 28, 5215 MC‘s Hertogenbosch, Netherlands Netherlands Ordinary
Liscombe B.V.*
Jarmuiden 56 a, 1046 AE, Amsterdam, Netherlands Netherlands Ordinary
RS Components B.V.*
Bingerweg 19, 2031 AZ Haarlem, Netherlands Netherlands Ordinary
RS Integrated Supply Netherlands B.V.*
Bingerweg 19, 2031 AZ Haarlem, Netherlands Netherlands Ordinary
RS Components Limited*
KPMG, 18 Viaduct Harbour Avenue, Auckland, 1010,
New Zealand New Zealand Ordinary
Elfa Distrelec AS*
Apotekergata 10B, 0180 Oslo, Norway Norway Ordinary
RS Components AS*
Kristian Augusts Gate 13, 0164 Oslo, Norway Norway Ordinary
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
30 Related undertakings continued
RS Group plc Annual Report and Accounts 2025188
Name and registered address of undertaking Country of incorporation Class of share held
New DEAM, LLC*
Two Radnor Corporate Center, Suite 400, Radnor,
PA 19087, United States
United States
of America Common
RS Americas, Inc*
7151 Jack Newell Blvd S., Fort Worth, TX 76118,
United States
United States
of America Common
RS Integrated Supply Puerto Rico LLC*
Two Radnor Corporate Center, Suite 400, Radnor,
PA 19087, United States
United States
of America Common
RS Integrated Supply US Inc.*
Two Radnor Corporate Center, Suite 400, Radnor,
PA 19087, United States
United States
of America Common
Holding, Financing and Management Companies
RS Components Business Services (Foshan) Limited*
22nd Floor, Glory International Financial Center, No.25,
Ronghe Road, Guicheng, Nanhai District, Foshan,
Guangdong, 528200, China China Ordinary
Electrocomponents France SARL*
Rue Norman King, 60000, Beauvais, France France Ordinary
Bodenfeld Immobilien GmbH*
Mainzer Landstraße 180, 60327, Frankfurt, Germany Germany Ordinary
Electrocomponents Jersey Finance Unlimited*
44 Esplanade, St Helier, JE4 9WG, Jersey Jersey Common
Synovos Netherlands C.V.*
Two Radnor Corporate Center, Suite 400, Radnor,
PA 19087, United States Netherlands Partnership
Electrocomponents Holdings (Thailand) Limited* (49.00%)
GMM Grammy Place, Room No. 1901-1904, Floor 19,
No. 50, Sukhumvit 21 (Asoke), Klongtoey Nua, Wattana,
Bangkok, 10110, Thailand Thailand Ordinary
Name and registered address of undertaking Country of incorporation Class of share held
RS Components AB*
Kronborgsgränd 1, 164 46 Kista, Sweden Sweden Ordinary
RS Integrated Supply Sweden AB*
Drottninggatan 96, 113 60, Stockholm, Sweden Sweden Ordinary
Distrelec Schweiz AG*
Grabenstrasse 6, 8606 Nänikon, Switzerland Switzerland Ordinary
Domnick (Thailand) Co., Ltd.* (86.74%)
No. 99/1-3, Naradhiwas Rajanagarindra Road,
Chong Nonsi, Yan Nawa, Bangkok,10120, Thailand Thailand Ordinary
RS Components Co., Ltd*
GMM Grammy Place, Room No. 1901-1904, Floor 19,
No. 50, Sukhumvit 21 (Asoke), Klongtoey Nua, Wattana,
Bangkok, 10110, Thailand Thailand Ordinary
Distrelec Ltd*
7th floor, 2 St Peter’s Square, Manchester, M2 3AA, UK UK Ordinary
IESA A & D Limited*
IESA Works Daten Park, Birchwood, Warrington,
Cheshire, WA3 6UT, UK UK Ordinary
John Liscombe Limited*
UK
Ordinary and
preference Fifth Floor, Two Pancras Square, London N1C 4AG, UK
Needlers Limited*
Ordinary and
preference Fifth Floor, Two Pancras Square, London N1C 4AG, UK UK
OKdo Technology Limited*
Fifth Floor, Two Pancras Square, London N1C 4AG, UK UK Ordinary
RS Components Limited
Birchington Road, Weldon, Corby, Northamptonshire,
NN17 9RS, UK UK Ordinary
RS Integrated Supply UK Limited*
IESA Works Daten Park, Birchwood, Warrington, Cheshire,
WA3 6UT, UK UK Ordinary
MRO Distribution, Inc.*
Two Radnor Corporate Center, Suite 400, Radnor,
PA 19087, United States
United States
of America Common
RS Group plc Annual Report and Accounts 2025 189STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Name and registered address of undertaking Country of incorporation Class of share held
Electrocomponents (US), Inc.*
United States
of America 7151 Jack Newell Blvd S., Fort Worth, TX 76118, United States Common
Electrocomponents US LLC*
United States
of America 7151 Jack Newell Blvd S., Fort Worth, TX 76118, United States Common
Synovos International, Inc.*
United States
of America
Two Radnor Corporate Center, Suite 400, Radnor, PA 19087,
United States Common
Not currently trading
RS Components (Proprietary) Limited*
20 Indianapolis Street, Kyalami Business Park,
Kyalami Midrand, Gauteng, 1684, South Africa South Africa Ordinary
Risoul (Trinidad and Tobago) Limited*
Nunez & Co, Level 2, Invaders Bay Tower, Invaders Bay, Off
Audrey Jeffers Highway, Port of Spain, Trinidad and Tobago Trinidad and Tobago Ordinary
Electro Lighting Group Limited*
Fifth Floor, Two Pancras Square, London N1C 4AG, UK UK Ordinary
IESA Limited
Fifth Floor, Two Pancras Square, London N1C 4AG, UK UK Ordinary
RS Limited*
Fifth Floor, Two Pancras Square, London N1C 4AG, UK UK Ordinary
RS Components Limited (UK), RS Componentes Limited (HK), RS Components B.V. (Netherlands) and
RS Components GmbH (Germany) operate branch offices in South Africa, the Philippines, China (Shanghai)
and China (Taiwan), Belgium and Switzerland.
31 Post balance sheet events
There were no material post balance sheet events.
Name and registered address of undertaking Country of incorporation Class of share held
Electrocomponents Newco (Thailand) Limited* (86.73%)
GMM Grammy Place, Room No. 1901-1904, Floor 19,
No. 50, Sukhumvit 21 (Asoke), Klongtoey Nua, Wattana,
Bangkok, 10110, Thailand Thailand Ordinary
Electrocomponents (Thailand) Limited* (73.99%)
GMM Grammy Place, Room No. 1901-1904, Floor 19,
No. 50, Sukhumvit 21 (Asoke), Klongtoey Nua, Wattana,
Bangkok, 10110, Thailand Thailand Ordinary
Electrocomponents Overseas Limited*
Fifth Floor, Two Pancras Square, London N1C 4AG, UK UK Ordinary
Electrocomponents US Finance Limited*
Fifth Floor, Two Pancras Square, London N1C 4AG, UK UK Ordinary
IESA A & D Holdings Limited*
IESA Works Daten Park, Birchwood, Warrington, Cheshire,
WA3 6UT, UK UK Ordinary
IESA Holdings Limited*
IESA Works Daten Park, Birchwood, Warrington, Cheshire,
WA3 6UT, UK UK Ordinary
Needlers Holdings Limited*
UK
Ordinary and
preference Fifth Floor, Two Pancras Square, London N1C 4AG, UK
RS Components Holdings Limited*
Fifth Floor, Two Pancras Square, London N1C 4AG, UK UK Ordinary
RS Group International Holdings Limited
Fifth Floor, Two Pancras Square, London N1C 4AG, UK UK Ordinary
RS Group Pension Trustees Limited
Fifth Floor, Two Pancras Square, London N1C 4AG, UK UK Ordinary
Electrocomponents, Inc*
United States
of America
Common and
preference 7151 Jack Newell Blvd S., Fort Worth, TX 76118, United States
Electrocomponents North America, Inc.*
United States
of America 7151 Jack Newell Blvd S., Fort Worth, TX 76118, United States Common
Electrocomponents North America LLC*
United States
of America 7151 Jack Newell Blvd S., Fort Worth, TX 76118, United States Common
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
30 Related undertakings continued
RS Group plc Annual Report and Accounts 2025190
The table below details the impact of the prior year adjustment on the affected line items in the opening
balance sheet (year ended 31 March 2023) and the comparative period (year ended 31 March 2024):
Inventory
£m
Tax
£m
Net impact
£m
Year ended 31 March 2023
Inventory (13.2) – (13.2)
Deferred tax asset/(liability) – 3.2 3.2
Net assets (13.2) 3.2 (10.0)
Total equity (13.2) 3.2 (10.0)
Cumulative
impact as at
1 April 2023
Inventory
£m
Tax
£m
Net impact
£m
Year ended 31 March 2024
Cost of sales (5.6) – (5.6)
Tax credit/(charge) – 1.3 1.3
Profit for the year (5.6) 1.3 (4.3)
Other comprehensive income 0.2 0.1 0.3
Inventory (13.2) (5.4) – (18.6)
Deferred tax asset/(liability) 3.2 – 1.4 4.6
Net assets (10.0) (5.4) 1.4 (14.0)
Total equity (10.0) (5.4) 1.4 (14.0)
The following tables summarise the Group’s primary financial statements for the periods indicated,
giving effect to the restatement described above.
32 Prior Period Adjustments
The Group identified a prior period adjustment, impacting the opening position at 1 April 2023 and the
year ended 31 March 2024. The impact of the prior period adjustment on the primary statements is
presented in the tables below.
Inventory and related tax balances
During the year ended 31 March 2025, the Group identified errors in relation to the calculation of
the inventory obsolescence provision. As explained in Note 18, in order to determine the value of
the inventory provision, inventory is allocated into different categories based on the number of years
required to sell the amounts held, based on the current “run rate” of sales. Depending on the number
of years’ sales required, different provisioning percentages are applied to each category in order to
estimate the recoverable value.
During the year, the Group identified that certain inventory lines had been allocated to the incorrect
category and as a result, an incorrect provisioning percentage had been applied in determining the
inventory provision in previous periods. In addition, it was identified that the Group provisioning policy
was not being consistently applied across the Group. As a result, comparative financial information has
been restated to correct for the incorrect classification of amounts between categories, and the failure of
certain components to comply with the Group’s internal provisioning policies.
The aggregate impact of the two errors is an overstatement of the Group inventory in the opening
balance sheet and comparative period.
The restatement decreases the Group’s inventory balance by £13.2 million at 1 April 2023 and by a
further £5.4 million for the year 2023/24.
As a consequence of the above change there is an impact on taxation. There is an additional credit to
the deferred tax balance of £3.2 million as at 1 April 2023 and a further £1.3 million credit recognised in
2023/24.
The net impact on opening reserves as at 1 April 2023 was £10.0 million including £0.3 million impact on
the translation reserve. In the year 2023/24, the impact on profit after tax was £4.3 million and on total
comprehensive income was £0.3 million.
RS Group plc Annual Report and Accounts 2025 191STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Group Statement of Comprehensive Income restated
Year ended 31 March 2024
Reported
£m
Inventory
£m
Tax
£m
Restated
£m
Profit for the year 183.7 (5.6) 1.3 179.4
Other comprehensive income/(expense)
Items that will not be reclassified subsequently to the
income statement
Remeasurement of retirement benefit obligations 0.8 – – 0.8
Related income tax (0.1) – – (0.1)
0.7 – – 0.7
Items that may be reclassified subsequently to the
income statement
Foreign exchange translation differences of joint venture (0.2) – – (0.2)
Foreign exchange translation differences (3.9) 0.2 0.1 (3.6)
Fair value gain on net investment hedges 3.4 – – 3.4
Movement in cash flow hedges (0.1) – – (0.1)
(0.8) 0.2 0.1 (0.5)
Other comprehensive income/(expense) for the year (0.1) 0.2 0.1 0.2
Total comprehensive income/(expense) for the year 183.6 (5.4) 1.4 179.6
Total comprehensive income is attributable to:
Owners of the Company 183.7 (5.4) 1.4 179.7
Non-controlling interests (0.1) – – (0.1)
183.6 (5.4) 1.4 179.6
32 Prior Period Adjustments continued
Group Income Statement restated
Year ended 31 March 2024
Reported
£m
Inventory
£m
Tax
£m
Restated
£m
Revenue 2,942.4 – – 2,942.4
Cost of sales (1,678.5) (5.6) – (1,684.1)
Gross profit 1,263.9 (5.6) – 1,258.3
Operating costs (983.8) – – (983.8)
Operating profit 280.1 (5.6) – 274.5
Finance income 4.8 – – 4.8
Finance costs (36.7) – – (36.7)
Share of profit of joint venture 0.6 – – 0.6
Profit before tax 248.8 (5.6) – 243.2
Income tax expense (65.1) – 1.3 (63.8)
Profit for the year attributable to owners of the Company 183.7 (5.6) 1.3 179.4
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
RS Group plc Annual Report and Accounts 2025192
As at 31 March 2023
Reported
£m
Inventory
£m
Tax
£m
Restated
£m
Non-current liabilities
Other payables (9.3) – – (9.3)
Retirement benefit obligations (37.2) – – (37.2)
Borrowings (184.6) – – (184.6)
Lease liabilities (34.3) – – (34.3)
Provisions (4.7) – – (4.7)
Deferred tax liabilities (90.1) – 3.2 (86.9)
Total non-current liabilities (360.2) – 3.2 (357.0)
Total liabilities (1,199.1) – 3.2 (1,195.9)
Net assets 1,344.9 (13.2) 3.2 1,334.9
Equity
Share capital and share premium 283.3 – – 283.3
Own shares held by Employee Benefit Trust (EBT) (2.2) – – (2.2)
Other reserves 108.8 0.4 (0.1) 109.1
Retained earnings 954.3 (13.6) 3.3 944.0
Equity attributable to owners of the Company 1,344.2 (13.2) 3.2 1,334.2
Non-controlling interests 0.7 – – 0.7
Total equity 1,344.9 (13.2) 3.2 1,334.9
Group Balance Sheet restated
As at 31 March 2023
Reported
£m
Inventory
£m
Tax
£m
Restated
£m
Non-current assets
Intangible assets 704.8 – – 704.8
Property, plant and equipment 186.3 – – 186.3
Right-of-use assets 46.9 – – 46.9
Investment in joint venture 1.5 – – 1.5
Other receivables 6.5 – – 6.5
Retirement benefit net assets 0.8 – – 0.8
Deferred tax assets 6.9 – – 6.9
Total non-current assets 953.7 – – 953.7
Current assets
Inventories 616.3 (13.2) – 603.1
Trade and other receivables 692.0 – – 692.0
Cash and cash equivalents – cash and short-term deposits 260.3 – – 260.3
Derivative assets 1.8 – – 1.8
Current income tax receivables 19.9 – – 19.9
Total current assets 1,590.3 (13.2) – 1,577.1
Total assets 2,544.0 (13.2) – 2,530.8
Current liabilities
Trade and other payables (658.9) – – (658.9)
Cash and cash equivalents – bank overdrafts (139.8) – – (139.8)
Lease liabilities (14.6) – – (14.6)
Derivative liabilities (1.7) – – (1.7)
Provisions (1.8) – – (1.8)
Current income tax liabilities (22.1) – – (22.1)
Total current liabilities (838.9) – – (838.9)
RS Group plc Annual Report and Accounts 2025 193STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
As at 31 March 2024
Reported
£m
Inventory
£m
Tax
£m
Restated
£m
Non-current liabilities
Other payables (17.3) – – (17.3)
Retirement benefit obligations (27.2) – – (27.2)
Borrowings (440.3) – – (440.3)
Lease liabilities (57.9) – – (57.9)
Provisions (4.2) – – (4.2)
Deferred tax liabilities (103.3) – 4.6 (98.7)
Total non-current liabilities (650.2) – 4.6 (645.6)
Total liabilities (1,465.5) – 4.6 (1,460.9)
Net assets 1,432.9 (18.6) 4.6 1,418.9
Equity
Share capital and share premium 286.9 – – 286.9
Own shares held by Employee Benefit Trust (EBT) (1.8) – – (1.8)
Other reserves 108.3 0.6 – 108.9
Retained earnings 1,038.9 (19.2) 4.6 1,024.3
Equity attributable to owners of the Company 1,432.3 (18.6) 4.6 1,418.3
Non-controlling interests 0.6 – – 0.6
Total equity 1,432.9 (18.6) 4.6 1,418.9
32 Prior Period Adjustments continued
Group Balance Sheet restated
As at 31 March 2024
Reported
£m
Inventory
£m
Tax
£m
Restated
£m
Non-current assets
Intangible assets 982.6 – – 982.6
Property, plant and equipment 180.9 – – 180.9
Right-of-use assets 72.8 – – 72.8
Investment in joint venture 1.3 – – 1.3
Other receivables 8.4 – – 8.4
Retirement benefit net assets 1.5 – – 1.5
Deferred tax assets 9.5 – – 9.5
Total non-current assets 1,257.0 – – 1,257.0
Current assets
Inventories 656.0 (18.6) – 637.4
Trade and other receivables 701.4 – – 701.4
Cash and cash equivalents – cash and short-term deposits 258.7 – – 258.7
Derivative assets 2.6 – – 2.6
Current income tax receivables 22.7 – – 22.7
Total current assets 1,641.4 (18.6) – 1,622.8
Total assets 2,898.4 (18.6) – 2,879.8
Current liabilities
Trade and other payables (602.7) – – (602.7)
Cash and cash equivalents – bank overdrafts (162.7) – – (162.7)
Borrowings – – – –
Lease liabilities (16.0) – – (16.0)
Derivative liabilities (1.1) – – (1.1)
Provisions (5.0) – – (5.0)
Current income tax liabilities (27.8) – – (27.8)
Total current liabilities (815.3) – – (815.3)
NOTES TO THE GROUP ACCOUNTS CONTINUED
For the year ended 31 March 2025
Group accounts continued
RS Group plc Annual Report and Accounts 2025194
Group Cash Flow Statement
Year ended 31 March 2024
Reported
£m
Inventory
£m
Tax
£m
Restated
£m
Cash flows from operating activities
Profit before tax 248.8 (5.6) – 243.2
Depreciation and amortisation 83.7 – – 83.7
Impairment of intangible assets 4.6 – – 4.6
Impairment of property, plant and equipment – – – –
Impairment of right-of-use assets 0.4 – – 0.4
Loss on disposal of non-current assets 1.6 – – 1.6
Equity-settled share-based payments 7.8 – – 7.8
Net finance costs 31.9 – – 31.9
Share of profit of and dividends received from joint venture – – – –
Decrease in inventories 4.9 5.6 – 10.5
Decrease in trade and other receivables 8.1 – – 8.1
Decrease in trade and other payables (82.2) – – (82.2)
Increase in provisions 1.1 – – 1.1
Defined benefit retirement contributions in excess of charge (9.8) – – (9.8)
Cash generated from operations 300.9 – – 300.9
Interest received 4.8 – – 4.8
Interest paid (35.8) – – (35.8)
Income tax paid (73.3) – – (73.3)
Net cash from operating activities 196.6 – – 196.6
Year ended 31 March 2024
Reported
£m
Inventory
£m
Tax
£m
Restated
£m
Cash flows from investing activities
Acquisition of businesses (313.1) – – (313.1)
Cash and cash equivalents acquired with businesses 9.0 – – 9.0
Total cash impact on acquisition of businesses (304.1) – – (304.1)
Purchase of intangible assets (35.7) – – (35.7)
Purchase of property, plant and equipment (15.9) – – (15.9)
Proceeds on sale of property, plant and equipment – – – –
Net cash used in investing activities (355.7) – – (355.7)
Cash flows from financing activities
Proceeds from the issue of share capital 3.6 – – 3.6
Purchase of own shares by EBT (1.5) – – (1.5)
Net increase in revolving facility and short-term loans 130.2 – – 130.2
Other loans drawn down 131.7 – – 131.7
Other loans repaid (2.5) – – (2.5)
Principal elements of lease payments (18.5) – – (18.5)
Dividends paid (104.1) – – (104.1)
Net cash generated from financing activities 138.9 – – 138.9
Net increase/(decrease) in cash and cash equivalents (20.2) – – (20.2)
Cash and cash equivalents at the beginning of the year 120.5 – – 120.5
Effect of exchange rate changes (4.3) – – (4.3)
Cash and cash equivalents at the end of the year 96.0 – – 96.0
Earnings per share
The impact of the restatement on earnings per share is set out below.
Year ended 31 March 2024
Reported
£m
Inventory
£m
Tax
£m
Restated
£m
Basic earnings per share 38.8p (1.2)p 0.3p 37.9p
Diluted earnings per share 38.7p (1.2)p 0.3p 37.8p
RS Group plc Annual Report and Accounts 2025 195STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Share capital
£m
Share
premium
account
£m
Own shares
held by EBT
£m
Profit and
loss account
£m
Total
£m
At 1 April 2023 47.3 236.0 (2.2) 697.4 978.5
Profit and total comprehensive income for the year – – – 155.6 155.6
Dividends (Note 16) – – – (104.1) (104.1)
Equity-settled share-based payments (Note 5) – – – 7.8 7.8
Settlement of share awards (Note 16) 0.1 3.5 1.9 (1.9) 3.6
Purchase of own shares by EBT (Note 16) – – (1.5) – (1.5)
Tax on equity-settled share-based payments – – – (0.4) (0.4)
At 31 March 2024 47.4 239.5 (1.8) 754.4 1,039.5
Profit and total comprehensive income for the year – – – 128.9 128.9
Dividends (Note 16) – – – (104.7) (104.7)
Equity-settled share-based payments (Note 5) – – – 9.4 9.4
Settlement of share awards (Note 16) – 0.2 6.0 (5.1) 1.1
Purchase of own shares by EBT (Note 16) – – (46.5) – (46.5)
Tax on equity-settled share-based payments – – – (0.2) (0.2)
At 31 March 2025 47.4 239.7 (42.3) 782.7 1,027.5
Notes
2025
£m
2024
£m
Fixed assets
Tangible assets 7 14.5 15.1
Investments in subsidiaries 8 558.6 648.6
Total fixed assets 573.1 663.7
Current assets
Debtors: amounts falling due after more than one year 10 17.7 0.7
Debtors: amounts falling due within one year 10 1,130.6 1,242.6
Cash at bank and in hand 29.0 104.6
Total current assets 1,177.3 1,347.9
Creditors: amounts falling due within one year 11 (332.5) (531.2)
Net current assets 844.8 816.7
Total assets less current liabilities 1,417.9 1,480.4
Creditors: amounts falling due after more than one year 12 (390.4) (440.9)
Net assets 1,027.5 1,039.5
Capital and reserves
Share capital 16 47.4 47.4
Share premium account 16 239.7 239.5
Own shares held by Employee Benefit Trust (EBT) 16 (42.3) (1.8)
Profit and loss account (including profit for the year of £128.9 million
(2023/24: £155.6 million))
16 782.7 754.4
Total equity 1,027.5 1,039.5
The Company accounts on pages 196 to 200 were approved by the Board of Directors on 20 May 2025
and were signed on its behalf by:
Kate Ringrose
Chief Financial Officer
RS Group plc
Company number: 647788
COMPANY STATEMENT OF CHANGES IN EQUITY
For the year ended 31 March 2025
COMPANY BALANCE SHEET
As at 31 March 2025
Company accounts
RS Group plc Annual Report and Accounts 2025196
4 Employees
Average number of employees 2025 2024
Management and administration for the Company 68 69
Management and administration for the Company’s subsidiaries 789 784
Management and administration total 857 853
Aggregate employment costs
2025 2024
£m £m
Wages and salaries 9.5 6.9
Social security costs 1.2 0.9
Share-based payments - equity-settled (Note 5) 1.0 (0.2)
Share-based payments - cash-settled (0.1) (0.4)
Defined contribution retirement benefit costs (Note 6) 0.5 0.4
12.1 7.6
Termination benefits 0.6 0.6
Total 12.7 8.2
Information on the Directors’ remuneration is in the Directors’ Remuneration Report on pages 104
to 131.
The numbers above are for employees who work for the Company. There are a number of Group
employees whose contracts of employment are with the Company but who actually work in its
subsidiaries and perform no services directly for the Company. These employees are not included in the
cost numbers above.
5 Share-based payments
The Company operates a number of share-based payment schemes for employees of the Group, details
of which are in Note 9 of the Group accounts. Certain of the Company’s employees participate in the
equity-settled LTIPs, DSBP and equity-settled SAYE which grant rights to the Company’s own equity
instruments and hence are accounted for as equity-settled share-based payments.
1 General information
RS Group plc (the Company) is the parent company of the RS Group and is included in the consolidated
accounts of RS Group plc (the Group accounts). The Company is a public limited company and is
incorporated, registered and domiciled in England and Wales. The address of its registered office is Fifth
Floor, Two Pancras Square, London N1C 4AG, UK.
2 Statement of compliance
The individual accounts of the Company have been prepared in compliance with United Kingdom
Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard
(FRS) applicable in the UK and Republic of Ireland’ (FRS 102) and the Companies Act 2006.
3 Basis of preparation
These are the Company’s separate accounts and have been prepared on a going concern basis,
under the historical cost convention, as modified by the recognition of certain financial assets and
liabilities measured at fair value through profit and loss. They are presented in sterling and rounded
to the nearest £0.1 million. The principal accounting policies have been applied consistently unless
otherwise stated.
The preparation of accounts under FRS 102 requires the Company to make judgements, estimates
and assumptions that affect the application of accounting policies and reported amounts of assets
and liabilities, income and expenses. There are no areas involving a higher degree of judgement
or complexity, or areas where assumptions and estimates are significant that are included in
these accounts.
Under section 408 of the Companies Act 2006 the Company is exempt from the requirement to present
its own profit and loss account.
The Company has taken advantage of the following disclosure exemptions available under FRS 102:
i. preparation of a cash flow statement
ii. financial instrument disclosures
iii. share-based payment disclosures
iv. key management personnel compensation disclosure
Transactions in foreign currencies are recorded using the rate ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are
retranslated at the rate ruling at that date and the gains and losses on translation are recognised in
profit or loss.
NOTES TO THE COMPANY ACCOUNTS
For the year ended 31 March 2025
RS Group plc Annual Report and Accounts 2025 197STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
8 Investments in subsidiaries
Investments in subsidiaries are carried at the lower of cost and expected recoverable amount.
This includes loans that are intended for use on a continuing basis in the entity’s activities, including
acquisition of subisidiaries, and expected to be repaid after more than one year, although there is an
option for the Company to require repayment on demand. Impairments are recognised in the profit and
loss account.
The expense relating to share-based payments that grant rights to the Company’s equity instruments to
employees of other Group companies is treated as an increase in investments with the corresponding
credit taken directly to reserves. In the year ended 31 March 2025, this amounted to £8.4 million
(2023/24: £8.0 million).
Shares
£m
Loans
£m
Total
£m
Cost
At 1 April 2024 235.4 428.3 663.7
Additions 8.4 – 8.4
Loans repaid – (88.7) (88.7)
Translation differences – (9.7) (9.7)
At 31 March 2025 243.8 329.9 573.7
Impairments
At 1 April 2024 and 31 March 2025 – 15.1 15.1
Net book value
At 31 March 2025 243.8 314.8 558.6
At 31 March 2024 235.4 413.2 648.6
A list of the Company’s related undertakings is in Note 30 to the Group accounts.
6 Post-employment benefits
Employees of the Company may be members of the Group’s UK pension schemes.
Defined benefit scheme
There is no agreement or stated policy for charging the net defined benefit cost for the scheme to
the individual Group entities. Both the Company and RS Components Limited, the main UK trading
subsidiary of the Company, are the sponsoring employers. The majority of the scheme members work
for RS Components Limited and so it accounts for the UK scheme as a defined benefit scheme in its
accounts. The Company recognises a cost equal to its contributions.
Details of the UK defined benefit scheme is in Note 10 of the Group accounts.
Defined contribution scheme
Contributions to the defined contribution scheme are expensed as they fall due.
7 Tangible assets
Tangible assets are stated at cost (or deemed cost for the freehold warehouse facility which is occupied
by a wholly owned subsidiary) less accumulated depreciation and any provisions for impairment.
Cost includes the original purchase price, costs directly attributable to bringing the asset to its working
condition for its intended use and any dismantling and restoration costs.
No depreciation has been charged on land. Other assets are depreciated to residual value on a straight-
line basis over the following useful lives: investment property (freehold warehouse facility occupied by a
wholly owned subsidiary) 50 years; leasehold improvements 10 years; plant and machinery 10 years; and
computer equipment 5 years.
Investment
property
£m
Leasehold
improvements
£m
Plant and
machinery
£m
Computer
equipment
£m
Total
£m
Cost
At 1 April 2024 and 31 March 2025 18.2 1.2 9.2 0.8 29.4
Depreciation
At 1 April 2024 3.5 0.8 9.2 0.8 14.3
Charged in the year 0.5 0.1 – – 0.6
At 31 March 2025 4.0 0.9 9.2 0.8 14.9
Net book value
At 31 March 2025 14.2 0.3 – – 14.5
At 31 March 2024 14.7 0.4 – – 15.1
Company accounts continued
NOTES TO THE COMPANY ACCOUNTS CONTINUED
For the year ended 31 March 2025
RS Group plc Annual Report and Accounts 2025198
Amounts owed by subsidiary undertakings are unsecured, bear interest at market rates and are
repayable on demand. The carrying amount includes an impairment allowance of £54.8 million
(2023/24: £40.3 million).
11 Creditors: amounts falling due within one year
2025
£m
2024
£m
Amounts owed to subsidiary undertakings 281.2 353.7
Bank overdrafts 41.6 157.6
Other derivative liabilities 3.7 3.8
Provisions 0.3 –
Accruals 4.7 7.9
Other creditors 1.0 8.1
Cash-settled share-based payment liability – 0.1
332.5 531.2
Amounts owed to subsidiary undertakings are unsecured, bear interest at market rates and are
repayable on demand.
12 Creditors: amounts falling due after more than one year
2025
£m
2024
£m
Unsecured private placement loan notes repayable after more than five years 38.6 78.4
Unsecured private placement loan notes repayable from four to five years 37.8 –
Unsecured private placement loan notes repayable from two to three years – 78.7
Unsecured private placement loan notes repayable from one to two years 76.8 –
Unsecured multicurrency revolving facility agreement repayable from four to five years 112.6 155.0
Unsecured term loan repayable from three to four years 124.2 –
Unsecured term loan repayable from two to three years – 128.2
Other creditors 0.3 0.4
Cash-settled share-based payment liability 0.1 0.2
390.4 440.9
Details of the private placement loan notes, multicurrency revolving facility agreement are in Notes 21 to
23 of the Group accounts.
9 Financial instruments
Derivative financial instruments and hedging activities
The Company has elected to adopt the recognition and measurement provisions of IAS 39 (as adopted
in the UK) and the disclosure provisions of FRS 102 in respect of financial instruments.
The Company uses derivative financial instruments to cover its exposure to foreign exchange risks
arising from operational and financing activities. It principally employs forward foreign exchange
contracts to hedge against changes in exchange rates on behalf of its operating subsidiaries using back-
to-back external and intra-group forward foreign exchange contracts and these subsidiaries apply cash
flow hedging where appropriate. In accordance with its treasury policies, the Company does not hold or
issue derivative financial instruments for trading purposes.
All the Company’s derivatives are measured at fair value with changes in the fair values recognised in
profit or loss.
Other financial instruments
All other financial assets, including cash and bank balances and amounts owed by subsidiary
undertakings, are initially recognised at transaction price and then subsequently at amortised cost less
any provision for impairment.
All other financial liabilities, including accruals, other creditors, bank overdrafts and loans, private
placement loan notes and amounts owed to subsidiary undertakings, are initially recognised at
transaction price and then subsequently at amortised cost.
10 Debtors
2025
£m
2024
£m
Amounts falling due within one year:
Amounts owed by subsidiary undertakings 1,123.2 1,233.8
Other derivative assets 3.6 3.8
Prepayments 3.8 5.0
Debtors: amounts falling due within one year 1,130.6 1,242.6
Amounts falling due after more than one year:
Amounts owed by subsidiary undertakings 17.5 0
Deferred tax asset (Note 13) 0.2 0.7
Debtors: amounts falling due after more than one year 17.7 0.7
During the year an impairment of £14.4 million was recognised in profit and loss against amounts owed
by subsidiary undertakings such as OKdo and IESA Group (2023/24: £16.3 million).
A loan with maturity of March 2030 was entered into during the year with RS Integrated Supply
UK Limited.
RS Group plc Annual Report and Accounts 2025 199STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
13 Deferred tax
The charge or credit for taxation is based on the taxable profit or loss for the year and takes into
account taxation deferred because of timing differences. Deferred tax is recognised, without
discounting, in respect of all timing differences between the treatment of certain items for taxation and
accounting purposes.
Deferred tax assets are attributable to the following:
2025
£m
2024
£m
Equity-settled share-based payments 0.2 0.7
Deferred tax asset (Note 10) 0.2 0.7
There are no unused tax losses or unused tax credits.
14 Operating lease commitments
Future minimum amounts payable under non-cancellable operating leases are:
2025
£m
2024
£m
Within one year 1.2 1.2
From one to five years 1.5 2.8
2.7 4.0
15 Contingent liabilities
The Company enters into financial guarantee contracts to guarantee the indebtedness of certain other
companies within the Group. The Company treats the guarantee contracts as a contingent liability
until such time as it becomes probable that the Company will be required to make a payment under
the guarantee.
Guarantees exist in respect of bank facilities available to certain subsidiaries, up to a maximum of
£110.6 million (2023/24: £86.7 million), of which £0.9 million (2023/24: £8.8 million) had been drawn
down at the end of the year.
16 Capital and reserves and dividends
Details of the Company’s share capital, share premium account, EBT and dividends paid to shareholders
are in Notes 13 and 26 of the Group accounts.
The Company has sufficient distributable reserves to pay dividends for a number of years and is also
able to increase its distributable reserves further by receiving distributions from its subsidiaries.
Company accounts continued
NOTES TO THE COMPANY ACCOUNTS CONTINUED
For the year ended 31 March 2025
RS Group plc Annual Report and Accounts 2025200
Summary balance sheets and other metrics
2025
£m
2024
restated
1
£m
2023
restated
1
£m
2022
£m
2021
restated
2
£m
Non-current assets 1,153.8 1,261.6 953.7 706.1 711.0
Current assets 1,471.3 1,622.8 1,577.1 1,395.1 1,134.8
Current liabilities (716.4) (815.3) (838.9) (726.2) (631.8)
Non-current liabilities (554.2) (650.2) (357.0) (266.5) (314.6)
Net assets 1,354.5 1,418.9 1,334.9 1,108.5 899.4
Add back: net debt 364.2 418.2 113.0 42.1 122.0
Add back: retirement benefit net obligations 13.9 25.7 36.4 12.4 55.7
Capital employed 1,732.6 1,862.8 1,484.3 1,163.0 1,077.1
Return on capital employed (ROCE)
3
15.2% 17.1% 29.7% 28.7% 19.4%
Adjusted free cash flow 214.1 151.2 263.6 162.9 145.4
Average number of employees 8,709 8,964 7,818 7,383 6,806
Share price at 31 March 561.5p 726.80p 914.0p 1,084.0p 993.0p
1. Please refer to Note 32 in the Financial Statements for further details of this restatement. Prior years have not been restated.
2. Restated in 2021/22 for measurement period adjustments for prior year acquisitions.
3. ROCE is based on monthly average capital employed.
Summary income statements and related metrics
2025
£m
2024
restated
1
£m
2023
£m
2022
£m
2021
£m
Revenue 2,903.5 2,942.4 2,982.3 2,553.7 2,002.7
Operating profit 232.8 274.5 383.0 308.8 167.2
Add back: amortisation and impairment
of acquired intangibles
37.3 26.6 16.6 11.6 7.0
Add back: acquisition-related items 4.1 5.1 2.6 – 2.9
Add back: substantial reorganisation costs
and substantial asset write-downs
– – – – 11.2
Adjusted operating profit 274.2 306.2 402.2 320.4 188.3
Net finance costs (27.3) (31.9) (12.2) (7.1) (6.8)
Share of profit of joint venture 0.6 0.6 0.7 0.5 0.2
Adjusted profit before tax 247.5 274.9 390.7 313.8 181.7
Amortisation and impairment
of acquired intangibles
(37.3) (26.6) (16.6) (11.6) (7.0)
Acquisition-related items (4.1) (5.1) (2.6) – (2.9)
Substantial reorganisation costs and substantial
asset write-downs
– – – – (11.2)
Profit before tax 206.1 243.2 371.5 302.2 160.6
Income tax expense (53.5) (63.8) (86.7) (72.2) (35.1)
Profit for the year attributable to owners
of the Company
152.6 179.4 284.8 230.0 125.5
Earnings per share 32.5p 37.9p 60.4p 48.9p 27.7p
Adjusted earnings per share 39.1p 42.9p 63.6p 51.3p 31.3p
Dividend per share
2
22.4p 22.0p 20.9p 18.0p 15.9p
FIVE YEAR RECORD
Year ended 31 March
Five year record
RS Group plc Annual Report and Accounts 2025 201STRATEGIC REPORT GOVERNANCE REPORT OTHER INFORMATIONFINANCIAL STATEMENTS
Your shareholder reference number (SRN) is
required to access your shareholding. This can
be found at the top of your welcome letter or
share certificate. Alternatively, you can obtain
your SRN by contacting Computershare on the
number provided.
Dividend reinvestment plan (DRIP)
Should you wish to reinvest your dividends in the
Company, you can take advantage of our DRIP.
It will allow you to use your cash dividend to buy
more RS Group shares in the market. You will
need to complete a DRIP application form and
return it to Computershare. This can be found,
together with plan terms and conditions, at
investorcentre.co.uk or in the Shareholder
Information section of our website under
Shareholder FAQs. Alternatively, please contact
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details and a form will be sent to you.
Share price information
The latest information on the RS Group plc share
price is available on our corporate website:
rsgroup.com
Registered office
RS Group plc
Fifth Floor
Two Pancras Square
London N1C 4AG
United Kingdom
Tel: +44 (0)20 7239 8400
rsgroup.com
Registered number: 647788
Registered in England and Wales
Shareholder services
Registrar
If you have any questions about your
shareholding in the Company, please
contact our Registrar:
Computershare Investor Services PLC
The Pavilions,
Bridgwater Road,
Bristol BS99 6ZZ
Tel: 0370 703 0199
investorcentre.co.uk/contactus
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To access online information about your
shareholding visit investorcentre.co.uk
Through the Investor Centre you can:
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and review dividend payment history
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communications electronically
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REGISTERED OFFICE, FINANCIAL CALENDAR
AND ADVISORS
Shareholder information
RS Group plc Annual Report and Accounts 2025202
Financial calendar
Announcement of results
The results of the Group are normally
published at the following times:
– Half-year results for the
six months ending 30 September
in early-November
– Preliminary announcement for the
year ending 31 March in late May
– Annual Report and Accounts for the
year ending 31 March in mid-June
Dividend payments
Our current policy is to normally
make dividend payments at the
following times:
– Interim dividend in January
– Final dividend in July
Contacts
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BS99 6ZZ
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RS Group plc Annual Report and Accounts 2025 203STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONOTHER INFORMATION
A&C Automation and control
AGM Annual general meeting
AI Artificial intelligence
B2B Business to business
B2C Business to customer
BEIS Department of Business, Energy & Industrial Strategy
(from February 2023, theDepartmentfor Business andTrade)
CAGR Compound annual growth rate
CEO Chief Executive Officer
CFO Chief Financial Officer
CO
2
e Carbon dioxide equivalent
CPO Chief People Officer
CSRD Corporate Sustainability Reporting Directive
D&I Diversity and inclusion
DC Distribution centre
DMA Double Materiality Assessment
DRIP Dividend Reinvestment Plan
DSBP Deferred share bonus plan
EBITA Earnings before interest, taxes and amortisation
EBITDA Earnings before interest, taxes, depreciation andamortisation
EPS Earnings per share
ERG Employee resource groups
ESG Environmental, social and governance
EU European Union
EVP Employee Value Proposition
EWB-UK Engineers Without Borders UK
ExCo Executive Committee
FC Fulfilment centre
FCA Financial Conduct Authority
FRC Financial Reporting Council
FRS Financial Reporting Standard
GSBS Global Shared Business Services
GHG Greenhouse gas
HVO Hydrotreated Vegetable Oil
IAS International accounting standards
ICFR Internal controls over financial reporting
IFRS International Financial Reporting Standard
J2G LTIP Journey to Greatness Long-term Incentive Plan
KPIs Key performance indicators
LTIP Long-term incentive plan
M&A Mergers and acquisitions
MRO Maintenance, repair and operations
NIS2 The Network and Information Security (NIS2) Directive
NPI New product introduction
NPS Net Promoter Score
PBT Profit before tax
PMI Purchasing Manager Index
PPE Personal protective equipment
PMS Product Management Solution
ROCE Return on capital employed
RS YAY! RS YAY! all employee share award
SAYE Save as you earn
SBT Science-based targets
SBTi Science Based Targets initiative
STEM Science, technology, engineering and maths
TCFD Task Force on Climate-related Financial Disclosures
The Code UK Corporate Governance Code 2018
The updated Code The UK Corporate Governance Code 2024
TPT UK Transition Plan Taskforce
TSR Total shareholder return
TWMP The Washing Machine Project
UK IAS UK-adopted international accounting standards
UNGC United Nations Global Compact
UN SDGs United Nations sustainable development goals
GLOSSARY
OF TERMS
RS Group plc Annual Report and Accounts 2025204
NOTES
RS Group plc Annual Report and Accounts 2025 205STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATIONOTHER INFORMATION
RS Group plc
Fifth Floor
Two Pancras Square
London N1C 4AG
United Kingdom
Tel: +44 (0)20 7239 8400
rsgroup.com
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