Keller Group plc
19 March 2015
Keller Group plc ("the Company") - Annual Report 2014
In accordance with Listing Rule 9.6.1, copies of the following documents have
been submitted to the National Storage Mechanism:
* Annual Report and Accounts for the year ended 31 December 2014 (the `Annual
Report 2014')
* The notice of annual general meeting 2015
* Form of proxy for the annual general meeting
These documents will shortly be available for inspection at the National
Storage Mechanism at www.hemscott.com/nsm.do.
The Annual Report 2014 is also available on the Company's website at
www.keller.co.uk. Hard copies of all the documents have been sent to
shareholders.
The annual general meeting will be held at 11.00am on Thursday 14 May 2015 at
the offices of Investec, 2 Gresham Street, London, EC2V 7QP.
In accordance with DTR 6.3.5, this announcement contains information in the
attached Appendix of the principal risk factors, the directors' responsibility
statement and a note to the accounts on related party transactions. This
information has been extracted in full unedited text from the Annual Report
2014. References to page numbers and notes in the Appendix refer to those in
the Annual Report 2014. A condensed set of financial statements was appended
to Keller Group plc's preliminary results announcement issued on 2 March 2015.
For further information please contact:
Kerry Porritt
Company Secretary
Appendix
Unedited extract from Annual Report 2014
Principal risks and uncertainties
Risk Description Controls and KPIs
mitigation
Market cycles Whilst our business Strategy of (A) Revenue growth
will always be geographic compared with
The Group's broad subject to economic diversification: market growth
base helps to cycles, market risk
mitigate against is reduced by the * operations in Definition and
the risk of diversity of our over 40 method of
downturn in our markets, both in countries calculation
markets terms of geography
and market segment. * Broad customer Year-on-year sales
base. growth (including
It is also partially acquisitions) in
offset by * Services used local currency
opportunities for across all compared with
consolidation in our industry growth in the total
highly fragmented segments: regional
markets. Typically, infrastructure, construction
even where we are industrial, market.
the clear leader, we commercial,
still have a residential and
relatively small environmental.
share of the market.
Our ability to
exploit these
opportunities
through bolt-on
acquisitions is
reflected in our
track record of
growing sales, and
doing
so profitably,
across market
cycles.
Tendering and It is in the nature * Risk Management (B) Operating
management of our business that Framework margin
of contracts we continually defines Minimum
assess and manage Standards in the Definition and
Project risk is technical, and other control of method of
managed operational, risks. project risk. calculation
throughout the
life of a project * Risk-based Operating profit
from the tender approval before exceptional
tendering stage process, with items expressed as
to completion clear a percentage of
delegations of revenue.
authority.
* Independent
review of
tenders.
* Training for
staff in the
typical risk
issues they may
face when
tendering for
jobs,
negotiating
contracts and
executing work.
* Legal review of
unusual or
onerous contract
terms.
* Project staff
selected on the
basis of their
skills,
experience.
* Establishment of
`centres of
excellence'.
* Periodic reviews
of poorly
performing
contracts to
establish
lessons learned
with the results
communicated to
all relevant
staff.
Expansion We recognise the * Moving into new (C) Return on net
risks associated geographic operating assets
Our long-term with acquisitions markets often
growth track and expanding into involves Definition and
record is built new regions and aim following method of
on a combination to manage these to customers with calculation
of organic growth acceptable whom we have
and acquisitions levels. previously Operating profit
worked. before exceptional
These include items expressed as
various country * We deploy a percentage of
risks, including the trusted and average net
challenges of experienced operating assets
operating within personnel to (including goodwill
different business establish and acquired through
and safety cultures. grow our acquisitions).
business in new
When considering an regions. `Net operating
acquisition, we try assets' excludes
to get to know a * Robust operating net debt, tax
target company, rules, including balances, deferred
often working in our Think Safe consideration and
joint venture, to framework and net defined benefit
understand the Code of Conduct, pension
operational and apply wherever liabilities.
cultural differences in the world we
and potential are working.
synergies.
* Cross-border
support and
sharing of
expertise
support the
transfer of
technologies.
* Acquisition
targets are
usually well
known to Keller.
* We have thorough
due diligence
processes,
mostly
undertaken by
our own
management.
* Individual
integration
plans reflect
the unique
character of
each
acquisition.
Safety Keller is made up of * Think Safe (D) Accident
businesses of initiative Frequency Rate
The construction varying sizes rolled out (`AFR')
industry poses operating around the across Group in
significant world, often in 2010 - a refresh Definition and
safety challenging of policies and method of
challenges, but environments. guidance due to calculation
we do not view take place in
injuries as being It is essential 2015 Accident frequency
inevitable that, as we continue per 100,000 man
to grow and move * Group HSE hours.
into new regions, we Committee
can be sure that our monitors safety Lost time injuries
approach to safety programmes, sets are calculated as
is equally rigorous, targets for any incident over
no matter improvements and one day.
whereabouts in the ensures lessons
world, or on which learned across
projects, we are the Group where
working. appropriate.
* Group HSE
Director
continues to
drive
improvement in
safety standards
and attitudes
supported by
regional HSE
representatives
in the
divisions.
* All divisions
complete
thorough self
assessments
annually of
their safety
performance and
culture, which
are used as a
basis for
developing
safety
improvement
plans.
People The risk of losing, We aim to be a (E) Staff turnover
or not being responsible employer rate
The accumulation able to attract, for whom our
of knowledge and good people employees are proud Definition and
experience is is key. to work. method of
essential to calculation
helping our We pride ourselves We provide excellent
customers to find in having some of training and Managerial,
the best the best development professional and
solutions professional and opportunities; technical staff
skilled people in experience on leaving in the
the industry, who challenging and period, other than
are motivated by our high-profile through redundancy
culture and the projects; or normal
opportunities for opportunities for retirement,
career growth. international career expressed as a
growth; and good percentage of
engagement and employees in this
two-way category.
communications.
We aim to treat our
employees with
fairness, dignity
and respect.
Responsibility statement of the Directors in respect of the annual report and
the financial statements
We confirm that to the best of our knowledge:
* the financial statements, prepared in accordance with the applicable set of
accounting standards, 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
as a whole; and
* the Directors' report, including content contained by reference, 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.
The Board confirms 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 performance, strategy and business model of the
Company.
26 Related party transactions
Transactions between the parent, its subsidiaries and joint operations, which
are related parties, have been eliminated on consolidation.
The remuneration of the Directors, who are the key management personnel and
related parties of the Group, is set out in note 6 (extract below).
2014 2013
£m £m
Short-term employee benefits 2.0 3.4
Post-employment benefits 0.1 0.1
Share-based payments 0.9 1.0
3.0 4.5