ANNUAL REPORT AND ACCOUNTS 2024

For the year ended 31 March 2024

rsgroup.com

FOCUS.

ALIGN.

PRIORITISE.

EXECUTE.

Welcome to our Annual Report

Strategic report

Performance highlights 1

RS Group at a glance 2

Value creation 3

Chair’s introduction 4

Our stakeholders 6

Our marketplace 8

&KLHI([HFXWLYH2ࢇFHUȆV&(2

introduction 10

Business model and strategy 13

Strategy in action 14

Our growth ambitions 17

Our values 18

Key performance indicators 20

Financial review 24

Regional review 29

Risks, viability and going concern 32

Environmental, social

DQGJRYHUQDQFH(6* 

Regulatory statements 70

Governance report

Chair’s letter 73

Our Board of Directors 74

Governance at a glance 76

Board leadership and governance

framework 77

Board activities during the year 80

Board evaluation 84

Governance code compliance 86

Nomination Committee report 88

Audit Committee report 92

Directors’ Remuneration report 99

Directors’ report 116

Statement of Directors’

responsibilities 119

Financial statements

Independent Auditors’ report 120

Group accounts 127

Company accounts 173

Five year record 178

Other information

Shareholder information 179

Glossary of terms 181

In this report

Front cover: The Technical Solutions Centre at our regional

distribution centre at Fort Worth, US

For information about your shareholding visit:

rsgroup.com/investors/shareholder-information

We have included a glossary of terms at the end

of this document to help explain our acronyms

Navigating this interactive document

Return to

contents

Return to previously

viewed page

Page

back

Page

forward

FINANCIAL ESG GLOBAL GOALS

Performance highlights

Advancing

sustainability

61%

Reduction in Scope 1

and 2 emissions since

2019/20 excluding

recent acquisitions

2,3

2022/23: 57%

2,3

90%

of Group electricity

is from renewable

sources

2022/23: 91%

Championing

education and

innovation

796k

Young engineers and

students reached

through educational

programmes, products

and DesignSpark

platform since 2020/21

2022/23: 471k

31k

lives improved since

2019/20 through

our support of The

Washing Machine

Project (TWMP)

2022/23: 28k

Empowering

our people

employee

engagement score

2022/23: 78

34%

of our senior leaders

are women and 11%

are ethnically diverse

2022/23: 30% women

and 11% ethnically diverse

Doing business

responsibly

45%

of employees with

carbon reduction

metric in annual

bonus incentive

2022/23: 50%

52%

of suppliers by spend

have an EcoVadis

rating to drive ESG

performance

2022/23: 49%

Revenue

£2,942m

Change: (1)%

3URࢉWEHIRUHWD[

£249m

Change: (33)%

Adjusted

RSHUDWLQJSURࢉWPDUJLQ

10.6%

Change: (2.9) pts

Earnings per share

38.8p

Change: (36)%

Dividend per share

22.0p

Change: +5%

Like-for-like

revenue change

(8)%

Change: (18) pts

Adjusted

SURࢉWEHIRUHWD[

£281m

Like-for-like

change: (30)%

Return on capital employed

17.4%

Change: (13.4) pts

Adjusted

earnings per share

43.8p

Like-for-like

change: (34)%

Adjusted

IUHHFDVKࢊRZ

£151m

Change: (43)%

ESG RATINGS AND

STANDARDS

S&P: included in

Sustainability Yearbook

Medal rating: Platinum

Climate leadership score: A-

Global top 50 ESG companies

2024 rating: AA

Index score 2023: 3.6/5

 6HH 1RWH  RQ SDJHV  WR  IRU GHࢉQLWLRQV DQG UHFRQFLOLDWLRQV

2. Performance excludes acquisitions completed in 2022/23 and 2023/24.

6FRSHDQGHPLVVLRQVXSGDWHGWRUHࢊHFWUHSRUWLQJDQGHPLVVLRQVIDFWRUFKDQJHV

4. 2022/23 performance restated to include post-acquisition data from acquisitions

completed in 2022/23 and 2023/24.

Read more on page 31

countries with RS operations

1.1m

customers

c.9,000

employees

>2,500

suppliers

 6HH 1RWH  RQ SDJHV  WR  IRU GHࢉQLWLRQV DQG UHFRQFLOLDWLRQV

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 2

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

CREATING VALUE FOR

ALL OUR STAKEHOLDERS

THROUGH-CYCLE VALUE

CREATION TARGETS

REVENUE GROWTH

TWICE MARKET

(OF GDP+)

MID-TEEN

ADJUSTED OPERATING PROFIT MARGIN

>70%

cash conversion rate

>20%

return on capital employed

30% ADJUSTED OPERATING PROFIT

CONVERSION

Well positioned in growth markets

Global leader in a large, industrial MRO market, growing at GDP+

through cycle

'LࢆHUHQWLDWHGSURSRVLWLRQGULYLQJPDUNHWVKDUHJDLQ

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

6LJQLࢉFDQWRSHUDWLQJOHYHUDJH

&UHDWLQJXWLOLVLQJDQGRSWLPLVLQJPRUHHࢇFLHQWDQGࢊH[LEOHSK\VLFDO

digital and process infrastructure

$WWUDFWLYHࢉQDQFLDOFKDUDFWHULVWLFV

Strong cash generation supporting ongoing investment and high returns

on invested capital

Disciplined acquisitions accelerating consolidation

Rigorous investment discipline and clear capital allocation policy driving

accelerated value creation

Value creation

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 3

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Last year was a challenging one for RS and the

industry in general. The industrial market is cyclical

but, by prioritising and pursuing the tremendous

RSSRUWXQLWLHV WKDW OLH DKHDG ZH DUH FRQࢉGHQW LQ

GHOLYHULQJ WKURXJKF\FOH JURZWK DQG VLJQLࢉFDQWO\

LPSURYHGࢉQDQFLDOSHUIRUPDQFHRYHUWKHPHGLXP

term. The people of RS are fundamental to our

success and, again this year, they have been

outstanding in terms of their dedication,

professionalism and enthusiasm. My sincere

thanks go out to each and every one of them.

Strategy

Our strategy remains the same but we have

UHࢉQHG LW GXULQJ WKH \HDU WR SURYLGH JUHDWHU IRFXV

more alignment, better prioritisation and improved

execution. We remain focused on organic growth,

supplemented by value-accretive mergers and

acquisitions (M&A).

7KH%RDUGLVIXOO\VXSSRUWLYHRIWKHZRUNWKDWWKH

Executive Committee (ExCo) team has undertaken

to clarify the strategic actions and KPIs required

to help us achieve our strategic goals and create

sustainable value.

With our leadership in digital and our vast range

of product and service solutions, we are well

SRVLWLRQHG WR FDSLWDOLVH RQ WKH VLJQLࢉFDQW PDUNHW

RSSRUWXQLW\ )RU PRUH RQ RXU PDUNHW RSSRUWXQLW\

and strategy please see pages 8 and 13.

)ROORZLQJLWVDFTXLVLWLRQLQ-DQXDU\5LVRXOKDV

outperformed our expectations. In Latin America,

we see tremendous opportunities ahead as our

team in Americas increases its collaboration

with Risoul.

We were also pleased to welcome the Distrelec

team into RS Group following completion of its

DFTXLVLWLRQLQ-XQH'LVWUHOHFLVDVWURQJࢉW

with RS in EMEA. Its rapid integration, in terms

of combined sales, marketing and product

management, will accelerate our business across

the region. Our M&A pipeline is strong and we will

FRQWLQXH WR H[HUFLVH VWUDWHJLF DQG ࢉQDQFLDO GLVFLSOLQH

2XUFXOWXUHDQGYDOXHV

7KH %RDUG LV FOHDU WKDW FXOWXUH LV IXQGDPHQWDO WR

the success of our business. We have continued to

admire and value the special culture that exists

across our global operations.

Towards the end of the year, RS created a new set

of values to unite the business behind how we

should behave and work. Launched at our

2024 Leadership Event, the values help guide our

decision making to deliver great outcomes,

improve our corporate governance and reinforce

RXUDPD]LQJFXOWXUHȁDFXOWXUHRIZKLFKZHFDQ

all be proud.

7KH %RDUG EHOLHYHV WKDW WKHVH YDOXHV RXWOLQH

what the business needs to do to be successful:

ȁ We are one team

ȁ We deliver brilliantly

ȁ We do the right thing

ȁ We make every day better

A strong Environmental, Social and Governance

(ESG) approach is embedded in our culture

and strategy and we remain focused on our

commitment to raise ESG standards across our

business and wider value chain. At RS, we are

clear that strong ESG performance is a key part

of our success and provides opportunities for

business growth. To read about our progress

against our 2030 ESG action plan goals please

see pages 40 to 61.

During the year, the Group has been included

in the S&P Global Sustainability Yearbook 2024,

positioned in the top 15% of companies in its

LQGXVWU\ UHࢊHFWLQJ OHDGHUVKLS DQG SURJUHVV LQ

sustainability. In addition, RS Group was awarded

a platinum medal by EcoVadis for the second

consecutive year, placing our business in the top

1% of the 100,000+ companies assessed.

7KH %RDUG KDV VHHQ UHDO EHQHࢉWV IURP KDUQHVVLQJ

the full potential of diverse talents, perspectives

and experiences to drive innovation, sound

decision making and sustainable success. We were

SOHDVHG WR EH UHFRJQLVHG E\ WKH )76(  :RPHQ

OUR PEOPLE ARE

FUNDAMENTAL

TOOUR SUCCESS

Chair’s introduction

Rona Fairhead

Chair

A challenging year but we

UHPDLQ FRQࢉGHQWDERXWWKH

opportunities ahead.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 4

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Leaders Review where RS was ranked fourth due

WRKDYLQJPRUHWKDQRIZRPHQRQRXU%RDUG

See pages 18 and 19 for more on our values

and culture

Our stakeholders

2XUYLVLRQLVWREHFRPHࢉUVWFKRLFHIRUDOORXU

stakeholders: our people, customers, suppliers,

FRPPXQLWLHVDQGVKDUHKROGHUV7KH%RDUGDQG

Company seek to engage actively with them all

to understand their needs. We have outlined on

pages 6 and 7 our stakeholder engagement and

outcomes for the Group during 2023/24.

We fully understand our obligations to our owners

ȁRXUVKDUHKROGHUV,QDGGLWLRQWRRWKHU%RDUG

members, I have spent a lot of time engaging

with shareholders and we truly value that

dialogue. In this regard, as well as building

a strong, sustainable company for our owners,

we also recognise the importance of our dividend

WRWKHPDQGWKH%RDUGLVSOHDVHGWRFRQWLQXHZLWK

our progressive dividend policy. More details on

RXU%RDUGHQJDJHPHQWZLWKRXUVWDNHKROGHUVFDQ

be found on pages 80 to 83.

Our Board

$WWKHHQGRIKLVࢉUVW\HDUDW56*URXSDV&KLHI

([HFXWLYH2ࢇFHU&(2WKH%RDUGLVGHOLJKWHG

with how Simon Pryce has directed the business.

+HKDVUHFRJQLVHGWKHFKDOOHQJHVUHࢉQHGWKH

strategy and is positioning the business for

improved execution and the growth opportunities

DKHDG:HDUHFRQࢉGHQWWKDWWKHJUHDWHUFODULW\

and focus will resonate strongly with our

stakeholders and drive further value.

We were also thrilled to welcome Kate Ringrose

DVRXU&KLHI)LQDQFLDO2ࢇFHU&)26KHMRLQHG

56*URXSIURP&HQWULFDD)76(FRPSDQ\

where she spent 18 years, culminating in the role

RI&)2.DWHKDVDVWURQJWUDFNUHFRUGRIGULYLQJ

exceptional business transformation, operational

excellence and strategic growth, and brings a

wealth of experience that has already been of

VLJQLࢉFDQWEHQHࢉWWRWKH*URXS

:HDUHFRQࢉGHQWWKDWXQGHU6LPRQȆVOHDGHUVKLS

supported by Kate and our global leaders, RS will

be able to accelerate the execution of our strategy

and capitalise on the opportunities ahead.

%HIRUH,FRQFOXGH,ZRXOGOLNHWRWXUQWRWKH%RDUG

2XU%RDUGUHYLHZKDVFRQࢉUPHGWKDWZHKDYH

a diverse range of relevant experience and

H[SHUWLVHHYHQDVZHFRQWLQXHWRVKDSHRXU%RDUG

for the future. I would like to thank each member

RIWKH%RDUGIRUWKHLUH[FHOOHQWFRXQVHOLQVLJKWV

and wisdom throughout the year. Once again,

they have been tremendous.

Looking ahead

As we continue to navigate the challenging

external environment, it is critical that we remain

focused on executing our strategy with zeal and

passion. We are excited and positive about the

RSSRUWXQLWLHVWKDWOLHDKHDGDQGIHHOFRQࢉGHQW

that, with the right leadership and people in place,

we will generate notable value and strong growth

in the medium term.

Culture is a critical driver

which energises and

motivates our people.”

Chair’s introduction continued

DRIVING VALUE FOR ALL OUR STAKEHOLDERS

Driving value for all our stakeholders underpins our purpose

of making amazing happen for a better world and ensures

that we do so sustainably and responsibly.

For our people

ȁ Clear people plan (page 53)

ȁ Created new set of values (pages 18 and 19)

For our customers

ȁ %HWWHU:RUOGSURGXFWUDQJHRIFVXVWDLQDEOHSURGXFWVSDJH

ȁ Sustainable MRO solutions to help customers meet their ESG goals (page 49)

ȁ Enhanced Scope 3 emissions reporting (page 47)

For our suppliers

ȁ Regular engagement on supplier ESG action priorities (page 49)

ȁ Support and guidance via our ESG supplier handbook (page 43)

For our communities

ȁ Supporting education and innovation through RS Grass Roots, DesignSpark

and OKdo (page 51)

ȁ Improving lives through support of social impact partners and volunteering

(pages 51 and 56 respectively)

For our shareholders

ȁ RS sustainable products and solutions are generating long-term revenue

(pages 48 and 49)

ȁ Expansion into low-carbon industry segments, such as renewable energy,

opening up new market opportunities (page 49)

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 5

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

What matters to our people

ȁ High-performance, purpose-led culture

ȁ Diversity and inclusion

ȁ Wellbeing and mental health

ȁ Training and career development

ȁ 3HUVRQDOࢉQDQFLDOSODQQLQJDQGHGXFDWLRQ

How we engage

ȁ Encourage employee-led networks

and communities

ȁ Regular employee engagement surveys

ȁ Diversity and inclusion training

ȁ Non-Executive Director initiatives and interactions

ȁ Training programmes and development

opportunities for all employees

ȁ Health and wellbeing resources

ȁ $FFHVVWRSHUVRQDOࢉQDQFLDOZHOOEHLQJWRROVDQG

regular pension seminars

What we have achieved

ȁ 2024 Leadership Event in March with 193 leaders

ȁ )LQDOLVWDQGOLVWHGLQWKH7RS,QVSLULQJ3ODFHV

to Work in North America

ȁ Received a 95/100 on the annual Corporate

(TXDOLW\,QGH[UHYLHZIRU/*%74,$

Inclusive Workplaces

ȁ Won Outstanding Employer award in the 2024 Top

Human Resource Management Awards in China

ȁ 3URJUDPPHSDUWQHULQࢉUVWHYHU([HFXWLYH

Accelerator programme by Moving Ahead

ȁ 253 people in UK apprenticeship programme

ȁ A Gold member of the Apprentice 5% club for

three consecutive years in the UK

Why they matter The value we bring +RZZHZLOOPHDVXUHࢉUVWFKRLFH

OUR PEOPLE

Our people are fundamental to the success

of our business and we continue to invest in

our ability to recruit, retain and develop the

best talent.

Creating an inclusive and engaging

environment where everyone is proud and

excited to come to work as themselves and

can perform at their best, develop and thrive.

ȁ My Voice engagement score

CUSTOMERS

,WLVFUXFLDOWRXQGHUVWDQGRXUFXVWRPHUVȆ

needs in order to create value, solve problems

and unlock opportunities.

%HLQJDWUXVWHGSUREOHPVROYHUGHOLYHULQJ

excellence through a connected experience

and a suite of valued product and service

solutions for industrial MRO customers.

ȁ Net promoter score

SUPPLIERS

We work in partnership with our suppliers

to deliver an unrivalled product choice and

innovative solutions for our customers.

%HLQJDWHFKQLFDOO\OHGVHUYLFHRULHQWHG

supplier partner of choice, bringing an

unrivalled product range and innovative

solutions to industrial MRO customers.

ȁ Number of stocked products

COMMUNITIES

Across our communities worldwide, we

are implementing educational initiatives to

improve lives and inspire the next generation

of engineers.

Supporting our communities to improve

SHRSOHȆVOLYHVLQVSLULQJIXWXUHJHQHUDWLRQV

while creating a more sustainable world.

ȁ Reduction in carbon emissions

SHAREHOLDERS

Our shareholders include institutional

investors and individuals who provide the

capital for our business to grow.

Creating superior economic value through

delivering reliably for our stakeholders,

generating consistent and sustainable cash

returns on invested capital well in excess of

our cost of capital.

ȁ Earnings per share

Our stakeholders

UNDERSTANDING

THE NEEDS OF ALL

OUR STAKEHOLDERS

It is important for us to engage with all our stakeholders to understand what matters

to them, ensuring we are responsive to their needs and adding value. The views of our

VWDNHKROGHUVDUHIXQGDPHQWDOWRXVEHFRPLQJࢉUVWFKRLFHDQGGULYLQJDORQJWHUP

VXVWDLQDEOHEXVLQHVV:HKDYHWKHUHIRUHGHࢉQHG.3,VIRUHDFKRIRXUVWDNHKROGHUV

DQGZLOOVHWWDUJHWVWRGHWHUPLQHRXUSURJUHVVLQEHFRPLQJࢉUVWFKRLFH

OUR PEOPLE

Linked to our ESG goals:

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 6

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

What matters to our suppliers

ȁ Data-driven product management

ȁ Knowledge of customer needs and trends

ȁ Ease of doing business

ȁ 2ࢆHULQJIXOOUDQJHRISURGXFWDQGVHUYLFH

solutions to our customers

ȁ Positive environmental and social impact,

operating to high ethical standards

How we engage

ȁ Dedicated account managers

ȁ Regional and global supplier events

ȁ 6XSSOLHUVFRUHFDUGVZLWKGHࢉQHGWDUJHWV

ȁ Voice of Supplier survey every two years

ȁ 56&RQQHFWȁSDUWQHULQJZLWKVXSSOLHUVWR

connect with customers

ȁ Seamless new product introductions

ȁ Regular engagement with suppliers on ESG

action plan

What we have achieved

ȁ Stronger partnerships with our suppliers

ȁ :RUNHGZLWKVXSSOLHUVWRH[WHQG%HWWHU:RUOG

product range

ȁ Developing a programme to source, store

and deliver products closer to the customer

ȁ Attendance at Smart Production Solutions (SPS)

conference in Munich, Germany

What matters to our customers

ȁ Innovative and sustainable solutions to solve

problems and unlock opportunities

ȁ A seamless experience so customers can

focus on what they do best

ȁ A partner to build a more sustainable and

socially responsible future

ȁ An unrivalled choice of products and services

and availability

How we engage

ȁ Dedicated customer service

ȁ Seamless communication

ȁ Trade fairs, forums and presence at

customer sites

ȁ Voice of the Customer surveys

ȁ Customer performance reviews

What we have achieved

ȁ ([SDQGHG%HWWHU:RUOGSURGXFWUDQJHWRF

ȁ Risoul transactional website launched in Mexico

ȁ Expanded technical solution services in Americas

ȁ Enhanced search capabilities on 27 websites

WKURXJKXVLQJ*RRJOHWHFKQRORJ\DQGDUWLࢉFLDO

intelligence (AI)

ȁ Enabled greater localisation of digital

experiences to connect better with customers

ȁ Improved translation quality with 94% of customers

responding that product translations are good

ȁ 'URYHDFXWWLQJHGJHGDWDGULYHQȅWHVWDQGOHDUQȆ

DSSURDFKWKDWVLJQLࢉFDQWO\ERRVWHGFXVWRPHU

engagement and satisfaction

What matters to our communities

ȁ Providing support to our local communities

ȁ Providing educational initiatives to young people

ȁ Limiting environmental impact in operations

How we engage

ȁ Competitions to encourage innovation

ȁ Delivering SuperSkills Employability Training

ȁ 2XUH[FOXVLYH*OREDO<RXWK$GYLVRU\%RDUG

7KH)$%

ȁ Organising and supporting community

events and awards

ȁ Supporting academic institutions to

deliver high-quality engineering and

technology education

What we have achieved

ȁ c. 20,000 students participated in Engineers

:LWKRXW%RUGHUVDFWLYLW\

ȁ 1,942 students supported via our engineering

society partnerships

ȁ 141 hours of Super Skills training delivered

ȁ 1,591 young people attended RS Grass Roots

supported events

ȁ 30 teams received £1,000 worth of components

DQGWRROVWKURXJKWKH)RUPXOD6WXGHQW

%XLOG)XQG

ȁ 39 Divya washing machines built for The Washing

Machine Project (TWMP) by 110 RS volunteers

and sent to India, Kenya and Uganda

ȁ Delivered micro:bit computers to 90% of primary

VFKRROVLQWKH8.DVDNH\SDUWQHULQWKH%%&QH[W

gen campaign

What matters to our shareholders

ȁ Sustainable growth and superior returns

ȁ Understanding the business and our strategy

ȁ Strong corporate governance

ȁ ESG

How we engage

ȁ Annual General Meeting (AGM)

ȁ Investor roadshows, detailed investor events,

meetings and conferences

ȁ Stock exchange announcements, press releases

DQGUHVXOWVEULHࢉQJV

ȁ Ongoing dialogue with analysts and investors

What we have achieved

ȁ Achieved revenue compound annual growth rate

RIRYHUODVWࢉYH\HDUVH[FOXGLQJDFTXLVLWLRQV

ȁ Science-based targets developed to achieve

QHW]HURYDOLGDWHGE\WKH6FLHQFH%DVHG7DUJHW

LQLWLDWLYH6%7L

ȁ $ZDUGHGEHVW$QQXDO5HSRUW)76(

organisation by Corporate Reporting

Awards 2023

ȁ $ZDUGHG%HVW&RPSDQ\IRU6XVWDLQDELOLW\

Reporting in the industrial sector at the

Corporate ESG Awards 2023

ȁ Held meetings with shareholders representing

72% of our top 20 shareholders

ȁ Relaunched the RS Group corporate website

Our stakeholders continued

SUPPLIERS CUSTOMERS COMMUNITIES SHAREHOLDERS

Linked to our ESG goals: Linked to our ESG goals: Linked to our ESG goals:Linked to our ESG goals:

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 7

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

WELL POSITIONED

FOR SUSTAINABLE GROWTH

Our marketplace

THE MARKETS WE OPERATE IN

We operate in a large and fragmented industrial market with RS being

only one of a few global distributors of industrial MRO product and service

solutions. Despite its size, much of the market is still local and many of our

FRPSHWLWRUVDUHLQGHSHQGHQWEXVLQHVVHVDQGUHJLRQDOࢉUPVVSHFLDOLVLQJLQ

D QDUURZSURGXFWRࢆHULQJDQGOLPLWHGVHUYLFHVROXWLRQVZLWKOHVVGHYHORSHG

digital capabilities.

The markets we address

Automation and control (A&C)

0HFKDQLFDODQGࢊXLGSRZHU

Electronics

Maintenance

6DIHW\DQGSURWHFWLRQ

6LQJOHERDUGFRPSXWLQJ

Service solutions

Research

Compare

Partner

Install

Maintain

Improve

Repair

Procure

Specify

$EURDGDQGGHHSSURGXFWRࢆHULQJ

:HKDYHWKHSURGXFWUDQJHVXSHULRUDYDLODELOLW\DQGUHVSRQVLYHVHUYLFHFDSDELOLWLHVWKDWHQDEOHXVWRRࢆHU

LQGXVWULDODQG052SURGXFWVJOREDOO\2XUHOHFWURQLFVUDQJHFRQFHQWUDWHVPDLQO\RQWKHVXEFDWHJRULHV

DVVRFLDWHGZLWKLQGXVWULDOUHTXLUHPHQWV

Unnamed major competitors

RS 12345678

3URGXFWFDWHJRULHV Automation and control

0HFKDQLFDODQGࢊXLGSRZHU

Electronics

Maintenance

6DIHW\DQGSURWHFWLRQ

6LQJOHERDUGFRPSXWLQJ

)XOOSURGXFWRࢆHU Part range

Solutions to unlock new opportunities

:HKDYHVROXWLRQVWKDWVSDQRXUFXVWRPHUVȆDVVHWOLIHF\FOHDVWKH\PDQDJHWKHLUGHVLJQSURFXUHPHQW

LQYHQWRU\DQG052QHHGV

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 8

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

:HVHHࢉYHNH\WUHQGVWKDWDUHVKDSLQJWKHPDUNHWVZHRSHUDWHLQ$VZH

execute our strategic action plan, we must continue to be agile to react to

the ever-changing market demands and future proof our business, while

remaining focused on our long-term vision.

(DVHRIGRLQJ

business

3URYLGLQJ

solutions

One-stop

shop

Consolidation Increased focus

on sustainability

Our marketplace continued

TRENDS THAT ARE

SHAPING OUR MARKET

2XUFXVWRPHUVDUHVHHNLQJWRVLPSOLI\

WKHLUVXSSOLHUEDVHOHYHUDJHVSHQG

DQGUHDOLVHJUHDWHUYDOXH5HFHLYLQJ

SURGXFWVDQGVHUYLFHVIURPRQH

SURYLGHUVDYHVWLPHDQGJHQHUDWHV

FRVWHࢇFLHQFLHV

2XUVWUDWHJLFUHVSRQVH

– 0DLQWDLQLQJRXUXQLTXHEURDG

RࢆHULQJRIUHDGLO\DYDLODEOHSURGXFWV

for industrial customers

– 'HHSHQLQJRXUFRUHLQGXVWULDO

SURGXFWFDWHJRU\RI$&DQGUHODWHG

SURGXFWFDWHJRULHVWRHQDEOH

LQGXVWULDOHOHFWULࢉFDWLRQ

– &RQWLQXLQJWRGHYHORSRXUQHZ

SURGXFWLQWURGXFWLRQFDSDELOLWLHVWR

GHYHORSIXUWKHUDFXUDWHGH[SDQGHG

SURGXFWUDQJHDQGHOHYDWHWKH

VSHFLDOLVWSURGXFWUDQJHVRIRXU

DFTXLUHGEXVLQHVVHV

(6*KDVIDVWEHFRPHDSULRULW\IRUDOO

RXUVWDNHKROGHUVDQGLQFUHDVLQJO\ZH

have seen greater focus on more

VXVWDLQDEOHSURGXFWVGLVWULEXWLRQDQG

VHUYLFHVROXWLRQVUHVSRQVLEOHVXSSO\

FKDLQSUDFWLFHVDQGLQFOXVLYHFXOWXUH

2XUVWUDWHJLFUHVSRQVH

– 5REXVW(6*DFWLRQSODQZLWKIRXU

global goals to achieve by 2030

– /DXQFKHGWKH%HWWHU:RUOGSURGXFWV

FODLPVEDVHGIUDPHZRUNȁDFOHDU

DQGUREXVWLQGXVWU\SUHFHGHQW

HQDEOLQJRXUFXVWRPHUVWRSXUFKDVH

VXVWDLQDEOHDQGUHVSRQVLEOH

SURGXFWVWKH\FDQWUXVW

The industrial distribution market

LVFRQVROLGDWLQJDWSDFHLQFUHDVLQJ

WZRIROGRYHUWKHODVWWHQ\HDUVGULYHQ

E\JOREDOLVDWLRQDQGGLJLWDOLVDWLRQ

7KLVZLOODFFHOHUDWHVFDOHDQGOHDGWR

LPSURYHGHࢇFLHQFLHV

2XUVWUDWHJLFUHVSRQVH

– (QVXULQJZHPDLQWDLQDVWURQJ

EDODQFHVKHHWWRSURYLGHWKHVXSSRUW

to drive consolidation

– &OHDUDQGGLVFLSOLQHGFULWHULDVHWWR

IRFXVRQSRWHQWLDODFTXLVLWLRQVZKLFK

ZLOOSURYLGHRSHUDWLRQDOH[FHOOHQFH

VROXWLRQFDSDELOLW\H[SDQVLRQQHZRU

DGMDFHQWSURGXFWUDQJHH[WHQVLRQV

DQGJHRJUDSKLFRSSRUWXQLWLHV

– 6WUHQJWKHQLQJRXUFRUSRUDWH

GHYHORSPHQWDQGLQWHJUDWLRQWHDPV

WRVXSSRUWDSLSHOLQHRISRWHQWLDO

DFTXLVLWLRQVDQGLQWHJUDWLRQ

– $FTXLVLWLRQRIDEROWRQEXVLQHVV

LQ$XVWUDOLDLQ$SULOWR

VWUHQJWKHQRXUJHRJUDSKLFSUHVHQFH

2ࢆHULQJVROXWLRQVLVDNH\

GLࢆHUHQWLDWRUIRUDQ\RUJDQLVDWLRQ

and our customers are increasingly

H[SHFWLQJVROXWLRQVWRVROYHWKHLU

LPPHGLDWHSUREOHPVDQGSUHGLFW

SUREOHPVEHIRUHWKH\KDSSHQ

2XUVWUDWHJLFUHVSRQVH

– 6KLIWLQJRXUJOREDOIRFXVWRZDUGV052

WRH[SORLWIXOO\RXUGLJLWDOFKDQQHOV

increasing our inventory holding

DQGOHYHUDJLQJRXUJOREDOSUHVHQFH

– 'HYHORSLQJGLJLWDOO\OHG

VROXWLRQVRࢆHULQJ

– 7DUJHWLQJVSHFLࢉFLQGXVWU\YHUWLFDOV

ZLWKVHUYLFHVROXWLRQVWKDWUHVRQDWH

ZLWKRXUFXVWRPHUVȆQHHGV

2XU%%FXVWRPHUVDUHH[SHFWLQJ

DSHUVRQDOLVHGVHDPOHVVH[SHULHQFH

PLUURULQJWKH%&RQOLQHH[SHULHQFH

2XUVXSSOLHUVZDQWDSDUWQHUWKDW

XQGHUVWDQGVWKHLUWHFKQLFDOVSHFLDOLVW

SURGXFWVDQGWKDWFDQEULQJWKHLU

SURGXFWVWRPDUNHWVXFFHVVIXOO\

2XUVWUDWHJLFUHVSRQVH

– Digitally enabling a more globally

aligned and data-driven solutions

RࢆHULQJWKDWEXLOGVRQRXUFRUH

VWUHQJWKVZKLOHKHOSLQJXVPRYHXS

WKHYDOXHFKDLQZLWKERWKFXVWRPHUV

DQGVXSSOLHUV

– &RQWLQXHWRLQYHVWLQRXUVXSSO\FKDLQ

QHWZRUNVDQGGLVWULEXWLRQVLWHV

LQIUDVWUXFWXUHWRLQFUHDVHFDSDFLW\

DQGORFDOVRXUFLQJFDSDELOLWLHV

– &RQWLQXHWRGHYHORSRXUGLJLWDO

SODWIRUPVWRVLPSOLI\SURFXUHPHQW

IRURXUFXVWRPHUVPDNLQJLWHDVLHU

WRGREXVLQHVVZLWKXVDQGFRQWURO

WKHLUVSHQG

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 9

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

&KLHI([HFXWLYH2ࢇFHUȆV&(2LQWURGXFWLRQ

RS remains a leading, global MRO

distributor with real competitive

advantage given our technical

specialism, broad product range

DQG GLJLWDOO\HQDEOHGRࢆHU

ZDVDFKDOOHQJLQJ\HDU0DUNHWVZHUH

GLࢇFXOWZLWKZHDNJOREDOLQGXVWULDOGHPDQG

FKDQJHIURPSHDNWRWURXJKHOHFWURQLFVF\FOH

DQG JHRSROLWLFDOWHQVLRQLPSDFWLQJFRQࢉGHQFH

MXVW DVVXSSO\FRQVWUDLQWVEHJDQWRHDVH

,Q DGGLWLRQDGHHSHUDQDO\VLVRIRXUSHUIRUPDQFH

LQ DQGLGHQWLࢉHGWKDW56ZDV

D PDMRUEHQHࢉFLDU\RIXQXVXDOSRVWSDQGHPLF

WUDGLQJWDLOZLQGVSDUWLFXODUO\LQHOHFWURQLFV

$W D WLPHRISHQWXSGHPDQGDQGVXSSO\FKDLQ

FKDOOHQJHVRXU VWURQJLQYHQWRU\LQYHVWPHQW

VXSSOLHUUHODWLRQVKLSVDQGORQJWDLOSURGXFW

RࢆHULQJDOORZHGXVWRSURYLGHLQGXVWU\OHDGLQJ

SURGXFWDYDLODELOLW\$VDUHVXOWZHVDZVLJQLࢉFDQW

UHYHQXHJURZWKLQSDUWDVFRUHFXVWRPHUV

LQFUHDVHGWKHLURUGHUTXDQWLWLHVWRDGGUHVV

FRQFHUQVRYHUPDUNHWDYDLODELOLW\DQGLQSDUW

WKURXJKVDOHVRIVFDUFHSDUWVWRUHVHOOHUVDQG

RQHRࢆWUDQVLWRU\FXVWRPHUV7KLVZDVDWDWLPH

ZKHQVXSSOLHUDQGWKHUHIRUHSURGXFWSULFH

LQࢊDWLRQSDUWLFXODUO\RQORQJWDLOSURGXFWV

UHVXOWHGLQVKRUWWHUPJURVVPDUJLQLPSURYHPHQW

:HDUHPDNLQJPDWHULDOLPSURYHPHQWVWRRXU

SHUIRUPDQFHPDQDJHPHQWV\VWHPVWRLPSURYH

WUDQVSDUHQF\DQGLGHQWLI\VXFK WUDGLQJG\QDPLFV

EHWWHULQWKHIXWXUH

:HHVWLPDWHWKDWWKHEHQHࢉWRIWKHVH

WDLOZLQGVZDVFePLOOLRQUHYHQXHDQG

F e PLOOLRQRIRSHUDWLQJSURࢉWKLJKHUWKDQ

SUHYLRXVO\UHSRUWHGDVLWQRZLQFOXGHVXSOLIW

IURP JURVV PDUJLQEHQHࢉWDVZHOODVUHYHQXH

7RZDUGV WKHHQGRIDQGWKURXJKRXW

WKHVHWDLOZLQGVEHJDQWRGLVVLSDWHZLWK

DYHUDJHRUGHUYDOXHVUHWXUQLQJWRSUHYLRXVOHYHOV

DQGVXSSO\FKDLQVQRUPDOLVLQJ7KLVUHVXOWHGLQ

less demand from resellers and transient

FXVWRPHUVJHQHUDOGHVWRFNLQJDQGWKH

XQZLQGLQJ RILQࢊDWLRQUHODWHGEHQHࢉWV

7KLVPRUHGLࢇFXOWWUDGLQJHQYLURQPHQWKLJKOLJKWHG

WKHLPSRUWDQFHRIPRUHIRFXVDQGDOLJQPHQW

EHWWHUSULRULWLVDWLRQDQGH[HFXWLRQJUHDWHUDJLOLW\

DQGPRUHRSHUDWLRQDOULJRXUDFURVVWKH56*URXS

7KDQNVWRWKHH[FHSWLRQDOHࢆRUWVRIRXUSDVVLRQDWH

DQGFRPPLWWHGSHRSOHZHPDGHJRRGSURJUHVV

LQ DGGUHVVLQJWKHVHLVVXHVZKLOVWUHGXFLQJRXU

FRVW EDVHDQGZHDUHSDUWLFXODUO\SOHDVHGZLWK

WKH VWUDWHJLFDFFHOHUDWLRQRXUUHFHQWDFTXLVLWLRQV

DUHGHOLYHULQJ

$VDUHVXOWDQGGHVSLWHDFKDOOHQJLQJ

PDFURHFRQRPLFHQYLURQPHQWZDVDOVR

D \HDURIVLJQLࢉFDQWVWUDWHJLFDQGRSHUDWLRQDO

SURJUHVVIRU56

2XUࢉQDQFLDOSHUIRUPDQFH

'XULQJRXUUHYHQXHUHࢊHFWHGWKHFKDQJH

LQWKHHOHFWURQLFVF\FOHDQGXQZLQGRIDVVRFLDWHG

SRVWSDQGHPLFWUDGLQJWDLOZLQGVDVZHOODV

VRIWQHVVLQLQGXVWULDOSURGXFWLRQ2XUOHYHORI

RUJDQLFLQYHVWPHQWDQGRXURSHUDWLQJFRVW

EDVH KDGJURZQRYHUWKHODVWWZR\HDUVWRPHHW

LQࢊDWHGSRVWSDQGHPLFGHPDQGDQGKDGOLPLWHG

LPPHGLDWHࢊH[LELOLW\WRUHGXFHVLJQLࢉFDQWO\DVWKLV

GHPDQGUHGXFHG7KLVKDGDVLJQLࢉFDQWLPSDFW

RQ WKH*URXSȆVRSHUDWLQJSURࢉWPDUJLQLQ

:H SDUWLDOO\DGGUHVVHGWKLVE\WDNLQJFRVW

UHGXFWLRQDFWLRQVLQWKHIXQFWLRQVDQGUHJLRQV

accelerating the integration of Distrelec and

UHGXFLQJGLVFUHWLRQDU\VSHQG7KLVDOVRLQFOXGHG

WKHZULWHGRZQRIXQGHUSHUIRUPLQJVRIWZDUHDQG

LQYHQWRU\LQYHVWPHQWV

Our business in EMEA delivered a robust

SHUIRUPDQFH:HGHOLYHUHGDGHFOLQHLQ

OLNHIRUOLNHUHYHQXHGXHWRWKHRYHUDOOPDUNHW

ZHDNQHVVVSHFLࢉFDOO\LQWKHHOHFWURQLFVFDWHJRU\

DQGZLWKLQWKRVHPDUNHWVZKHUHZHVHOOD

KLJKHUWKDQDYHUDJHSURSRUWLRQRIRQERDUG

HOHFWURQLFVVXFKDV*HUPDQ\WRJHWKHUZLWKWKH

XQZLQGRIFePLOOLRQRIUHYHQXHIURPSRVW

SDQGHPLFWUDGLQJWDLOZLQGV7KHJURZWKDFFHOHUDWRUV

RIGLJLWDOVHUYLFHVROXWLRQVDQG56352RXUPDLQ

RZQEUDQGRXWSHUIRUPHGWKHUHJLRQ/LNHIRUOLNH

RSHUDWLQJSURࢉWGHFOLQHG:KHQH[FOXGLQJ

UHVWUXFWXULQJZULWHRࢆVDQGLQWHJUDWLRQFRVWV

RI WKHDFTXLVLWLRQRI'LVWUHOHFLWGHFOLQHG

EHQHࢉWLQJIURPLQ\HDUFRVWDFWLRQ(0($UHPDLQV

SIGNIFICANT

OPERATIONAL

PROGRESS

Simon Pryce

CEO

Annual Report and Accounts for the year ended 31 March 2024 10

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

RS Group plc

&KLHI([HFXWLYH2ࢇFHUȆV&(2LQWURGXFWLRQcontinued

RXUPRVWGHYHORSHGEXVLQHVVDQGRQHZKHUHZH

VHHVLJQLࢉFDQWEHQHࢉWIURPHࢆHFWLYHDQGPRUH

SURJUHVVHGLPSOHPHQWDWLRQRIRXUVWUDWHJ\

$IWHUDFRPSRXQGDQQXDOJURZWKUDWH&$*5RI

RYHUWKHSUHYLRXVWZR\HDUVRXUOLNHIRUOLNH

UHYHQXHLQ$PHULFDVGHFOLQHGE\7KLVUHJLRQ

KDVKLJKH[SRVXUHWR$&DQGRWKHUSURGXFWV

FRUUHODWHGWRWKHHOHFWURQLFVF\FOHDVZHOODVD

KLJKHUSURSRUWLRQRIRULJLQDOHTXLSPHQW

PDQXIDFWXUHUV%RWKDUHIDFWRUVLQLQFUHDVLQJ

$PHULFDVȆVHQVLWLYLW\WRWKHUDSLGWXUQLQWKH

HOHFWURQLFVF\FOH7KHHVWLPDWHGUHYHQXHJDLQ

LQIURPSRVWSDQGHPLFWUDGLQJZDV

FePLOOLRQ$PHULFDVFRQWLQXHVWRIRFXVRQ

H[SDQGLQJERWKVKDUHRIZDOOHWDQGWKHLQGXVWU\

YHUWLFDOVWKDWLWVXSSRUWVOHYHUDJLQJWKH*URXSȆV

FDSDELOLW\DQGLQYHVWPHQWLQGLJLWDOFKDQQHOV

H[SDQGLQJVHUYLFHVROXWLRQVDQGDFFHOHUDWLQJ

56352VDOHV

3URࢉWDELOLW\LQ$VLD3DFLࢉFUHGXFHGVLJQLࢉFDQWO\

ZLWKDUHGXFWLRQLQVDOHVYROXPHVFRPELQHGZLWK

DSHUFHQWDJHSRLQWGHFOLQHLQJURVVPDUJLQ

1HDUO\KDOIRIWKHGHFOLQHLVDWWULEXWHGWRWKHXQZLQG

LQWKHSRVWSDQGHPLFWDLOZLQGVZKLFKHOHYDWHGSULFHV

and the remainder due to its high electronics

H[SRVXUHQRWDEO\LQ-DSDQDQG&KLQD$XVWUDOLDDQG

1HZ=HDODQGGHOLYHUHGJURZWKZKLOH6RXWK(DVW

$VLDVLJQLࢉFDQWO\RXWSHUIRUPHGWKHUHJLRQ

$VLD3DFLࢉFFRQWLQXHVWREHDGHYHORSLQJUHJLRQ

IRU56ZKHUHLQPDQ\FRXQWULHVZHDUHEXLOGLQJ

FULWLFDOPDVVDVWKHLULQGXVWULDOEDVHGHYHORSV

WKURXJKWKHUROORXWRIDPRUHGLࢆHUHQWLDWHGRࢆHU

IRFXVHGRQLQGXVWULDODQGVHUYLFHVROXWLRQVWR

GULYHYROXPHVDQGRSHUDWLRQDOOHYHUDJH

6LJQLࢉFDQWVWUDWHJLFDQGRSHUDWLRQDO

ZRUNGXULQJ

'XULQJWKH\HDUZHPDGHJRRGSURJUHVVLQ

addressing the issues highlighted by the change in

WUDGLQJHQYLURQPHQW7KHVHDFWLRQVDUHLPSURYLQJ

WKHXQGHUO\LQJTXDOLW\RIRXUEXVLQHVVWRVXSSRUW

WKH*URXSȆVVLJQLࢉFDQWJURZWKRSSRUWXQLW\DQG

WRHQVXUHZHDUHEHWWHUSODFHGWREHQHࢉWDV

PDUNHWVLPSURYH:HDUHIRFXVHGRQGULYLQJ

RSHUDWLRQDOHࢆHFWLYHQHVVDQGH[HFXWLRQ

LPSURYLQJRSHUDWLQJOHYHUDJHDQGLQYHVWLQJ

LQRXUVWUDWHJLFJURZWKDFFHOHUDWRUV

%ULQJLQJPRUHIRFXVWRWKH*URXSȆVVWUDWHJ\

56KDVDFOHDULGHQWLW\ȁZHDUHDGLࢆHUHQWLDWHG

GLVWULEXWRURISURGXFWDQGVHUYLFHVROXWLRQV

'XULQJWKH\HDUZHEURXJKWFODULW\WRWKH*URXS

VWUDWHJ\UHGXFHGFRPSOH[LW\DQGFUHDWHG

alignment around key strategic actions:

– We are customerIRFXVHGDQGZLOOGHOLYHU

JUHDWHUYDOXHE\PHHWLQJWKHPDLQWHQDQFH

UHSDLUDQGRSHUDWLRQVQHHGVRIWHQWHFKQLFDOO\

FRPSOH[DQGORZYROXPHRIKLJKOLIHWLPHYDOXH

LQGXVWULDOFXVWRPHUV

– We are productH[SHUWVSURYLGLQJDXWRPDWLRQ

DQGFRQWUROHOHFWULFDODQGRWKHUWHFKQLFDOO\

GLࢆHUHQWLDWHGSURGXFWVROXWLRQVDVSDUWRIDEURDG

EXWFXUDWHGSURGXFWUDQJHZLWKKLJKDYDLODELOLW\

–Our solutionsGHHSHQFXVWRPHUUHODWLRQVKLSV

through selected scalable service solutions

WKDWJHQHUDWHFRUHSURGXFWSXOOWKURXJK

–Our customer experience is digitally enabled

DQGLVEHFRPLQJLQFUHDVLQJO\FXVWRPLVHG

– We drive operational excellence to deliver

HࢇFLHQWDQGZHOOLQYHVWHGSK\VLFDOGLJLWDO

DQGSURFHVVLQIUDVWUXFWXUHVXVWDLQDEO\DQG

ZLWKJUHDWSHRSOH

:HKDYHGHYHORSHGDQGDOLJQHGDFWLRQVDFURVV

WKH*URXSWRGHOLYHUWKLVVWUDWHJ\EHWWHU

 'ULYLQJRSHUDWLRQDOHࢆHFWLYHQHVV

)ROORZLQJDUHYLHZRIWKHZD\ZHRSHUDWHZHWRRN

a number of tangible actions during the year to

UHGXFHFRPSOH[LW\DQGLPSURYHHࢆHFWLYHQHVV

DQGHࢇFLHQF\SXWWLQJLQSODFHWKHFDSDELOLWLHV

WRGHOLYHURXUPXOWL\HDUVWUDWHJLFDFWLRQSODQ

:HHQKDQFHGRXUVHQLRUOHDGHUVKLSH[SHULHQFH

DQGFDSDELOLW\E\VWUHDPOLQLQJRXUVHQLRU

PDQDJHPHQWWHDPLQWRDQHPSRZHUHGOHDGHUVKLS

([&R7KLVFRPPLWWHHLVFKDLUHGE\WKH&(2DQGLV

FRPSULVHGRIWKH&)2WKH&KLHI3HRSOH2ࢇFHU

&32WKH&KLHI,QIRUPDWLRQ2ࢇFHUWKH&KLHIRI

&RUSRUDWH6HUYLFHVDQG&RPSDQ\6HFUHWDU\DQG

RXUWKUHH5HJLRQDO3UHVLGHQWV(ࢆHFWLYHIURP

$SULOZHDOVRFUHDWHGWKUHHQHZUROHVWR

OHDGRXUJURZWKDFFHOHUDWRUVRI&XVWRPHU

([SHULHQFH3URGXFWDQG6XSSO\&KDLQDQG

6ROXWLRQVDQG6HUYLFHV:HVWUHQJWKHQHGRXU

IXQFWLRQDOFDSDELOLW\WKURXJKVWURQJH[WHUQDO&)2

DQG&32DSSRLQWPHQWVDQGPDGHLQWHUQDO

2XU%HWWHU:RUOGSURGXFWUDQJHKHOSVWKHJOREDO

HQJLQHHUVLQQRYDWRUVDQGSUREOHPVROYHUVZHVHUYHWR

PDNHVXVWDLQDEOHDQGUHVSRQVLEOHSURGXFWSXUFKDVHV

WKDWPHHWWKHLUORQJWHUPQHHGV

:HNQRZIURPRXUFORVHFXVWRPHUUHODWLRQVKLSVDQG

LQGXVWU\UHVHDUFKWKDWVXVWDLQDELOLW\LVDWRSEXVLQHVV

SULRULW\DQGFHQWUDOWRFXVWRPHUEXVLQHVVJRDOV

$MRLQWUHSRUWIURP&,36DQG56,QGLUHFW3URFXUHPHQW

5HSRUWLQVKRZHGWKDWȅVXVWDLQDEOHDQGHWKLFDO

SURFXUHPHQWȆLVDWRSEXVLQHVVSUHVVXUHIRU8.

SURFXUHPHQWSURIHVVLRQDOV$GGLWLRQDOO\PDQ\RIRXU

customers have set long-term net zero commitments

DQGQHHGFRVWHࢆHFWLYHHࢇFLHQWDQGFUHGLEOHSURGXFWV

DQGVROXWLRQVWRKHOSWKHPUHDFKWKHVHDLPV

:LWKDODFNRIFUHGLEOHVXVWDLQDEOHSURGXFWFKRLFHV

DYDLODEOHIRULQGXVWULDOFXVWRPHUVZHVDZDQ

RSSRUWXQLW\WROHYHUDJHRXULQGXVWU\OHDGLQJSRVLWLRQ

WRFUHDWHDFOHDUDQGUREXVWFODLPVEDVHGIUDPHZRUN

WKDWHQDEOHVFXVWRPHUVDQGVXSSOLHUVWRVHDPOHVVO\

WUDQVLWLRQWRPRUHVXVWDLQDEOHDOWHUQDWLYHV$VRI

0DUFKRXU%HWWHU:RUOGSURGXFWUDQJHKDV

H[SDQGHGWRFSURGXFWVIURP7KHUDQJHLV

GLYHUVHDQGH[WHQVLYHDQGFRYHUVDOORXUNH\SURGXFW

categories and technologies including electrical

HTXLSPHQWSHUVRQDOSURWHFWLYHHTXLSPHQWDQG

UHQHZDEOHHQHUJ\HTXLSPHQW

2YHUWKHFRPLQJ\HDUVRXUDPELWLRQLVWRFROODERUDWH

ZLWKRXUVXSSOLHUVWRRࢆHUVXVWDLQDEOH

SURGXFWV7KLVZLOOEHVXSSRUWHGE\WKHH[SDQVLRQ

RIRXUVXVWDLQDELOLW\VROXWLRQVRࢆHUVHHSDJH

,QGRLQJVRZHZLOOFRQWLQXHWRFUHDWHORQJWHUP

YDOXHIRURXUVWDNHKROGHUVZKLOHDGYDQFLQJJOREDO

VXVWDLQDELOLW\RXWFRPHV

For more information on Better World

products and sustainability solutions,

see pages 48 and 49.

PRODUCTS

FORA BETTER

WORLD

ESG IN ACTION

DSSRLQWPHQWVLQWRJURZWKDFFHOHUDWRUUROHV7KLV

team is already driving needed changes in our

VWURQJFXOWXUHDOLJQLQJWKHRUJDQLVDWLRQEHKLQGD

FOHDUSXUSRVHVWUDWHJ\DQGQHZVHWRIFRUSRUDWH

YDOXHVȉ:HDUHRQHWHDP:HGHOLYHUEULOOLDQWO\:H

GRWKHULJKWWKLQJ:HPDNHHYHU\GD\EHWWHUȊ

7KLV([&RUHࢊHFWVRXUVLPSOLࢉHGRSHUDWLQJPRGHO

WKDWHPSRZHUVWHDPVFORVHVWWRWKHVXSSOLHUDQG

FXVWRPHUWRPDNHUDSLGDQGHࢆHFWLYHGHFLVLRQV

ZLWKLQFOHDUJXLGHOLQHV7KLVPRGHOLVGHVLJQHG

WRGULYHVXVWDLQDEOHJURZWKE\FODULI\LQJ

DFFRXQWDELOLWLHVDQGVXSSRUWLQJORFDOGHFLVLRQ

PDNLQJSURYLGLQJVXSSRUWIRURXUJURZWK

DFFHOHUDWRUVXQGHUSLQQHGE\FRVWHࢇFLHQW

HQDEOHUIXQFWLRQVSHRSOHWHFKQRORJ\ࢉQDQFH

DQGFRUSRUDWHVHUYLFHV

$OUHDG\ZHDUHPDNLQJTXLFNHUGHFLVLRQVDQG

PDNLQJSRVLWLYHSURJUHVV7KLVLQFOXGHVWUHDWLQJ

RXUHOHFWURQLFVRࢆHULQJDVDVWUDWHJLFSURGXFW

FDWHJRU\QRWDVHSDUDWHEXVLQHVVDQGVKLIWLQJ

RXUVLQJOHERDUGFRPSXWLQJDQGLQWHUQHWRIWKLQJV

,R7VROXWLRQVSURSRVLWLRQ2.GRDZD\IURP

FRQVXPHUVWRRXUFRUHLQGXVWULDOFXVWRPHUEDVH

,PSRUWDQWO\ZHDOVRHQKDQFHGRXUSHUIRUPDQFH

PDQDJHPHQWSURFHVVWRLPSURYHYLVLELOLW\

DFFRXQWDELOLW\DJLOLW\DQGWRGULYHEHWWHU

RSHUDWLRQDODQGIXQFWLRQDOGHOLYHU\

2. Improving operating leverage

:HDUHDZHOOLQYHVWHGGLVWULEXWLRQEXVLQHVV

VSDQQLQJFRXQWULHVJOREDOO\ZLWKFRQVLGHUDEOH

SK\VLFDOGLJLWDODQGSURFHVVLQIUDVWUXFWXUH

+RZHYHUZHVHHVLJQLࢉFDQWRSSRUWXQLWLHVWR

LPSURYHRXUSURGXFWLYLW\DQGRSHUDWLQJOHYHUDJH

WKURXJKWKHEHWWHUFRRUGLQDWLRQDFURVVDQG

XWLOLVDWLRQRIRXUSK\VLFDOLQIUDVWUXFWXUHDQG

VWDQGDUGLVLQJRXUV\VWHPVDQGSURFHVVHVZKHUH

WKHUHLVQRYDOXHLQGLࢆHUHQWLDWLRQ7KLVLQFOXGHV

FRQVROLGDWLQJDQGXSJUDGLQJRXUWHFKQRORJ\DQG

GLJLWDOSODWIRUPVDQGJUHDWHUKDUPRQLVDWLRQDFURVV

RXUDGPLQLVWUDWLYHSURFHVVHV

:HDUHDOUHDG\LPSURYLQJWKHRSHUDWLRQDO

SHUIRUPDQFHRIRXUSK\VLFDOLQIUDVWUXFWXUH

,QZHLQFUHDVHGWKHHࢇFLHQF\RIRXU

regional distribution centre (DC) in Germany

WKURXJKXSJUDGLQJDQGWXQLQJRXUZDUHKRXVH

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 11

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

RQHVHWRISK\VLFDOGLJLWDODQGSURFHVVLQIUDVWUXFWXUH

:HDUHDFFHOHUDWLQJRXULQLWLDOLQWHJUDWLRQSODQV

ZLWKRXUH[SHFWHGFRVWVDYLQJVDOUHDG\H[FHHGLQJ

WKRVHDQWLFLSDWHGZKHQZHPDGHWKHLQLWLDO

DFTXLVLWLRQ7KHUHIRUHGHVSLWHZHDNHUWUDGLQJ

LQLQOLQHZLWK56ȆVUHOHYDQW(XURSHDQ

PDUNHWVZHH[SHFWWRDWOHDVWFRYHURXUFRVWRI

FDSLWDOE\WKHWKLUG\HDUZLWKWKHORQJHUWHUP

EHQHࢉWVRIWKHDFTXLVLWLRQUHPDLQLQJYHU\H[FLWLQJ

5LVRXOZKLFKZHDFTXLUHGLQ-DQXDU\KDV

RXWSHUIRUPHGRXUH[SHFWDWLRQVUHࢊHFWLQJVWURQJ

PDUNHWFRQGLWLRQVLQ0H[LFRDQG5LVRXOȆVVSHFLDOLVW

WHFKQLFDOVHUYLFHRࢆHU:HDUHEHJLQQLQJWRUHDOLVH

WKHVLJQLࢉFDQWV\QHUJ\RSSRUWXQLWLHVIURPWKH

FRPELQDWLRQDVZHLQWURGXFH56ȆVGLJLWDO

FDSDELOLWLHVDQGRZQEUDQGSURGXFWVLQWR5LVRXO

DQGXVHWKH5LVRXOVHUYLFHDSSURDFKWRHQKDQFH

RXUVHUYLFHRࢆHULQJDFURVVRXU$PHULFDVUHJLRQ

:HFRQWLQXHWRKDYHDQDFWLYHSLSHOLQHRI

DFTXLVLWLRQRSSRUWXQLWLHVDQGDIWHUWKH\HDUHQG

DFTXLUHG7ULGHQW$XVWUDOLD3W\/WG7ULGHQWIRU

FePLOOLRQ7ULGHQWLVDVSHFLDOLVW052GLVWULEXWLRQ

DQGVHUYLFHSDUWQHUIRUWKHHQHUJ\DQGQDWXUDO

UHVRXUFHLQGXVWU\LQ:HVWHUQ$XVWUDOLD,WDGGVWR

RXU$XVWUDOLDQSUHVHQFHE\LQFUHDVLQJ56ȆVDFFHVV

WRWKHHQHUJ\DQGQDWXUDOUHVRXUFHVVHFWRUZLWK

DVVRFLDWHGFXVWRPHUDQGSURGXFWV\QHUJLHVDQG

SURYLGHVGLVWULEXWLRQLQIUDVWUXFWXUHDQGVHUYLFH

FDSDFLW\LQ:HVWHUQ$XVWUDOLD

For a Better World

:HFRQWLQXHGWRPDNHJRRGSURJUHVVWRZDUGVRXU

(6*DFWLRQSODQE\LPSURYLQJVXVWDLQDELOLW\

LQRXURSHUDWLRQVSDFNDJLQJDQGORJLVWLFVDQG

FROODERUDWLQJZLWKRXUVXSSOLHUVWRRࢆHURXU

FXVWRPHUVPRUHVXVWDLQDEOHSURGXFWDQGVHUYLFH

VROXWLRQFKRLFHVWRRSHUDWHPRUHUHVSRQVLEO\

7KLV\HDUZHUHFHLYHGYDOLGDWLRQRIRXU6FRSH

and 3 carbon reduction targets from the Science

%DVHG7DUJHWVLQLWLDWLYH:HDUHSURJUHVVLQJZHOO

WRZDUGVWKHVHKDYLQJUHGXFHGRXUGLUHFWFDUERQ

HPLVVLRQVE\VLQFHRXUEDVHOLQH

H[FOXGLQJDFTXLVLWLRQVFRPSOHWHGLQ

DQG

– Product and supply chain::LWKLQSURGXFWZH

DUHGHYHORSLQJDPRUHUHOHYDQW56352RࢆHULQ

$PHULFDVGHHSHQLQJRXURࢆHUZLWKWHFKQLFDO

VSHFLDOLVWEUDQGVDQGH[SDQGLQJRXU%HWWHU

:RUOGVXVWDLQDEOHUDQJHQRZFSURGXFWV

DYDLODEOHJOREDOO\,QVXSSO\FKDLQZHDUH

LQYHVWLQJLQEHWWHULQYHQWRU\PDQDJHPHQW

LQFOXGLQJDQHZGLJLWDOSURGXFWPDQDJHPHQW

V\VWHPLQ$PHULFDVDQGSURGXFWDGRSWLRQ

V\VWHPVWRLPSURYHSURGXFWLQJHVWLRQRUGHU

WUDFNLQJDQGGHOLYHU\DFFXUDF\

– Solutions and services::HFRQWLQXHWRH[SDQG

RXUVHUYLFHVROXWLRQVSRUWIROLRUROOLQJRXW

VXSSOLHUDQGGLJLWDOO\HQDEOHGSURFXUHPHQW

VROXWLRQVDFURVV(XURSHDQG$PHULFDIRFXVLQJ

RQVHUYLFHVWKDWSXOOWKURXJKSURGXFWUHYHQXH

DQGJHQHUDWHFXVWRPHUOR\DOW\:HH[SDQGHGWKLV

RࢆHUIXUWKHUWKURXJKRXW(0($DQGLQYHVWHGLQ

H[SHULHQFHGVDOHVWHDPVLQ$PHULFDV:LWKLQ

56,QWHJUDWHG6XSSO\ZHDUHVWDQGDUGLVLQJRXU

VHUYLFHSURYLVLRQDFURVVWKH8.DQG86WRGHOLYHU

SURࢉWDELOLW\DQGVFDODELOLW\

:HVHHWKHRSSRUWXQLW\WRDFFHOHUDWHYDOXH

creation by investing further in our technology

SODWIRUPWRSHUVRQDOLVHRXUGLJLWDOFXVWRPHU

H[SHULHQFHXWLOLVHEHWWHURXUFXVWRPHUGDWDEDVH

DQGPDQDJHRXUSURGXFWDQGVHUYLFHVROXWLRQV

RࢆHUPRUHFRVWHࢆHFWLYHO\7KLVLVWKHPDLQIRFXVRI

WKHDGGLWLRQDOFePLOOLRQRIRUJDQLFLQYHVWPHQW

SODQQHGLQERWKDQG

$FTXLVLWLRQVWKDWDFFHOHUDWHRXUVWUDWHJ\

7KHODUJHIUDJPHQWHGPDUNHWVLQZKLFKZHRSHUDWH

SURYLGHVLJQLࢉFDQWRSSRUWXQLW\IRUFRQVROLGDWLRQ

:HFUHDWHYDOXHIURPEROWRQDFTXLVLWLRQVWKURXJK

EHLQJSULFHGLVFLSOLQHGDQGE\WDUJHWLQJKLJKTXDOLW\

EXVLQHVVHVWKDWLQFUHDVHRXUSUHVHQFHLQNH\PDUNHWV

VWUHQJWKHQRXUSURGXFWVSHFLDOLVDWLRQH[SDQGRXU

VROXWLRQVDQGVHUYLFHVSRUWIROLRDQGRUFUHDWHWKH

RSSRUWXQLW\WRDFFHOHUDWHRSHUDWLQJOHYHUDJH

,Q-XQHZHFRPSOHWHGWKHDFTXLVLWLRQ

RI'LVWUHOHFDVWURQJࢉWZLWK56LQ(0($7KH

DFTXLVLWLRQGHOLYHUVLQFUHDVHGUHYHQXHLQ*HUPDQ\

6FDQGLQDYLDDQG6ZLW]HUODQGZKHUHLWDOVRDGGVD

ORFDOIXOࢉOPHQWFHQWUHWKDWLVFRPSOHPHQWDU\WRRXU

H[LVWLQJ(XURSHDQIRRWSULQW'LVWUHOHFȆVSURSRVLWLRQ

LVFORVHO\DOLJQHGWR56DQGZHZLOORSHUDWHWKURXJK

PDQDJHPHQWV\VWHPDQGUHPRYLQJZDVWHXWLOLVLQJ

RXUFRQWLQXRXVLPSURYHPHQWWRROER[:HFORVHG

DVPDOOORFDOIXOࢉOPHQWFHQWUH)&LQ1HZSRUW8.

DEVRUELQJSURGXFWLQWRRXU1XQHDWRQDQG&RUE\

IDFLOLWLHV:HEHJDQXSJUDGLQJRXUZDUHKRXVH

PDQDJHPHQWV\VWHPLQWKH8.DQGZHRSHQHG

DQH[SDQGHG)&LQ6SDLQDVZHOODVWKUHHVPDOO

FXVWRPHU)&VRSHUDWHGE\WKLUGSDUW\SURYLGHUV

LQ0DOD\VLD3KLOLSSLQHVDQG1HZ=HDODQG

:HFRQWLQXHWRVLPSOLI\DQGXSJUDGHRXUWHFKQRORJ\

LQIUDVWUXFWXUH'XULQJWKH\HDUZHPLJUDWHGWKH

PDMRULW\RIRXUGDWDFHQWUHVWRWKHFORXGLPSURYHG

RXUGLJLWDOSURFXUHPHQWFDSDELOLWLHVEHJDQ

converging our Microsoft estate and designed a

KLJKOHYHOURDGPDSWRPRGHUQLVHDQGKDUPRQLVH

NH\SURFHVVHVDQGV\VWHPV

'XULQJWKH\HDUDQGLQUHVSRQVHWRWKHFKDOOHQJLQJ

WUDGLQJHQYLURQPHQWZHDOVRLGHQWLࢉHGDQG

FRPPHQFHGVXVWDLQDEOHFRVWUHGXFWLRQDFWLRQV

LQFOXGLQJDFFHOHUDWLQJWKHLQWHJUDWLRQRI'LVWUHOHF

7RJHWKHUWKHVHDFWLRQVZLOOGHOLYHULQH[FHVVRI

ePLOOLRQRIDQQXDOLVHGFRVWVDYLQJVZLWK

ePLOOLRQGHOLYHUHGLQDQGDGGLWLRQDO

FePLOOLRQLQ'XULQJWKH\HDUWKHUH

ZDVePLOOLRQRIFRVWVDVVRFLDWHGZLWKWKH

UHGXFWLRQDQG'LVWUHOHFLQWHJUDWLRQ

:HKDYHLGHQWLࢉHGVLJQLࢉFDQWIXUWKHUFRVWDQG

HࢇFLHQF\EHQHࢉWVZKLFKZHZLOOSXUVXHRYHUWLPH

7KHVHZLOOEHUHDOLVHGWKURXJKVWDQGDUGLVLQJD

QXPEHURIEDFNRࢇFHVXSSRUWSURFHVVHVEHWWHU

OHYHUDJLQJRXUIXQFWLRQDOH[SHUWLVHDFURVVWKH

*URXSDQGPRUHHࢆHFWLYHPDQDJHPHQWRIRXU

FRVWWRVHUYHDQGVDOHVFKDQQHOV

3. Growth accelerators

:HDOVRFRQWLQXHGWRLQYHVWLQRXUJURZWK

DFFHOHUDWRUVWKDWZLOOGULYHLQFUHDVHGFXVWRPHUV

DQGVKDUHRIZDOOHW

– Customer experience:'XULQJWKH\HDUZHPDGH

VHOHFWLYHLQYHVWPHQWVLQRXUGLJLWDOFDSDELOLWLHVWR

HQKDQFHWKHFXVWRPHUH[SHULHQFHHPEHGGLQJ

$,SRZHUHGVHDUFKFDSDELOLW\LQRXUZHEVLWHVWR

PDUNHWVODXQFKLQJDQHZWUDQVDFWLRQDO

ZHEVLWHLQ/DWLQ$PHULFDLQWURGXFLQJDQ

LQWHJUDWHGFXVWRPHUUHODWLRQVKLSPDQDJHPHQW

WRRODQGFXVWRPLVHGZHESDJHVIRUVSHFLࢉF

LQGXVWU\YHUWLFDOV

&KLHI([HFXWLYH2ࢇFHUȆV&(2LQWURGXFWLRQcontinued

:HZHUHDJDLQUHFRJQLVHGZLWKD3ODWLQXP(FR9DGLV

UDWLQJZKLFKLVXVHGE\PDQ\RIRXUFXVWRPHUV

DQGVXSSOLHUVWRPDNH(6*EDVHGSURFXUHPHQW

GHFLVLRQVDQGVHOHFWEXVLQHVVSDUWQHUV

([FLWLQJORQJWHUPSRWHQWLDO

:HKDYHDGLVWLQFWFRPSHWLWLYHDGYDQWDJHDW56

DVWKHFULWLFDOOLQNEHWZHHQVRPHRIWKHZRUOGȆV

OHDGLQJVXSSOLHUVRILQGXVWULDOSURGXFWVDQGD

GLYHUVHFXVWRPHUEDVHWKDWZDQWWRSXUFKDVHLQ

VPDOOYROXPHVDQGGHPDQGKLJKVHUYLFHOHYHOV

:HKDYHDJOREDOSUHVHQFHDQGVFDOHDVWURQJ

GLJLWDOSODWIRUPDQGGLVWULEXWLRQLQIUDVWUXFWXUH

and increasingly have a solutions and service

orientation that drives customer loyalty and share

RIZDOOHWJURZWK

7KHVWUHQJWKRIRXURࢆHUFDQEHVHHQLQRXU

RXWSHUIRUPDQFHRYHUWLPH56KDVGHOLYHUHG

UHYHQXH&$*5RYHUWKHODVWࢉYH\HDUVH[FOXGLQJ

DOODFTXLVLWLRQVFRPSOHWHGRQZDUGV7KLV

LVVWURQJHUWKDQWKHJURZWKUDWHRILQGXVWULDO

SURGXFWLRQRYHUWKHVDPHSHULRG

2XURXWSHUIRUPDQFHLQ(0($HYHQZLWKDGLࢇFXOW

PDUNHWLQGLFDWHVWKHVWUHQJWKRIRXUSURSRVLWLRQ

:HKDYHIRFXVHGDFWLRQSODQVLQSODFHWRDFFHOHUDWH

GHSOR\PHQWRIRXUGLࢆHUHQWLDWHGRࢆHULQWRRXU

RSHUDWLRQVLQ$PHULFDVDQG$VLD3DFLࢉFZKLFK

VXSSRUWVRXUORQJHUWHUPJURZWKRSSRUWXQLW\

:HRSHUDWHZLWKLQDWWUDFWLYHDQGKLJKO\

IUDJPHQWHGLQGXVWULDO052PDUNHWVZKLFK

GHPRQVWUDWHJRRGWKURXJKF\FOHJURZWKDQG

ZHFRQWLQXHWRLQYHVWWRH[WHQGRXUUHFRUGRI

LQGXVWULDOSURGXFWLRQRXWSHUIRUPDQFH:HDUH

SXUVXLQJVLJQLࢉFDQWRSSRUWXQLWLHVWRLPSURYH

RXURSHUDWLQJOHYHUDJHDQGWKHHࢇFLHQF\RIRXU

SK\VLFDOGLJLWDODQGSURFHVVLQIUDVWUXFWXUH:HDOVR

have a strong balance sheet and generate good

FDVKࢊRZZKLFKZHZLOOFRQWLQXHWRGHSOR\LIZHVHH

WKHRSSRUWXQLW\IRUDFFHOHUDWHGYDOXHFUHDWLRQ

:LWKLPSURYHGIRFXVDQGDFOHDUDFWLRQSODQ

VXSSRUWHGE\WDUJHWHGLQYHVWPHQWVWRHQKDQFH

RXUFDSDELOLW\56LVZHOOSRVLWLRQHGWRGHOLYHURQ

LWVJURZWKSRWHQWLDODQGࢉUVWFKRLFHRXWFRPHVIRU

DOOVWDNHKROGHUVRYHUWKHORQJHUWHUP

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 12

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

OUR COMPETITIVE

ADVANTAGE

Business model and strategy

First choice for

SUPPLIERS

First choice for

CUSTOMERS

Who are our suppliers?

The world’s leading providers

of general, technical and

specialist products for industrial

MRO application

Why do they choose RS?

– End customer reach / market

access

– Rapid new product deployment

– Added value technical know-how

and solutions around products

– Data-driven product management

– Intelligence on market needs /

trends

– Supporting their ESG agendas

– Inventory cover close to

customers / ability to break bulk

orders into smaller quantities

– Reliability and ease of doing

business

Who are our customers?

Global multi-site operators to

VPDOORQHRࢆLQGXVWULDOFXVWRPHUV

purchasing small volumes of

multi-category MRO products

Why do they choose RS?

– Product assortment that meets

their complex needs

– Availability when they need it /

IXOࢉOPHQWUHOLDELOLW\

– Specialist technical product

support

– One-stop shop for supplier

consolidation

– Supporting their ESG agendas

– Solutions that solve problems

and unlock opportunities

– A seamless customer experience

across all interactions

Read more on about our strategy

in action on pages 14 to 16

Customers

Target high lifetime value

customers who buy a broad mix

of industrial MRO products in

small volumes

Products

Focus on technically led

and specialist ranges

within a broad product

RࢆHUZLWKDVWURQJIRFXV

on A&C and

HOHFWULࢉFDWLRQ

Operational

excellence

/HYHUDJHHࢇFLHQW

physical, digital and

process infrastructure

sustainably with

great people

Solutions

Scale solutions that pull

through product and drive

customer loyalty

Experience

Strengthen and tailor our

digitally enabled, seamless

customer experience across

all interactions with us

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 13

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

£257

average order value

7REHRXUFXVWRPHUVȆࢉUVWFKRLFHZHPXVWSURYLGHWKH

relevant product and services that solve their procurement

needs. We deliver excellence through a connected experience

and a suite of valued product and service solutions for

industrial MRO 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 purchasing small volumes of multi-category MRO

products ranging from global multi-site operators to small

single-site customers.

TARGET INDUSTRIAL

MRO CUSTOMERS

>750k

stocked products

:H RࢆHU D EURDG DQG GHHS UDQJH RI LQGXVWULDO 052

products to meet our customers’ needs. We will maintain

our broad range of technically led and specialist products,

with a strong focus on A&C. We will also increase and curate

DUDQJHLQDGMDFHQWFDWHJRULHVDQGDEURDGHURࢆHULQJ

WDLORUHGWR VSHFLࢉF FXVWRPHU QHHGV ZKLOVW OHYHUDJLQJ RXU

unique regional strengths.

Our strong and extensive supplier relationships ensure

wide product choice, availability and substitute options.

2XURZQEUDQG56352LVDNH\GLࢆHUHQWLDWRUIRUXVRࢆHULQJ

customers high-quality, competitively priced products.

INCREASE AND CURATE

OUR PRODUCTS

ENABLING OFFSHORE WIND

In 2023, RS won a landmark contract

to provide MRO solutions to support

WKHZRUOGȆVODUJHVWRࢆVKRUHZLQGIDUP

Working with Equinor, RS will provide

products and vital operational supplies

to support several wind projects

across the UK for the next three years.

As demand for renewable energy

increases, the development of the

RࢆVKRUHZLQGLQGXVWU\LVFUXFLDO

for long-term energy security

and sustainability.

Read more on page 49

Strategy in action

Annual Report and Accounts for the year ended 31 March 2024 14

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

RS Group plc

Strategy in action continued

24%

of revenue from

service solutions

:H RࢆHU VHUYLFH VROXWLRQV PDLQO\ GLJLWDO WKDW FUHDWH

customer loyalty and address customers’ problems that drive

product pull through. We also have a number of

revenue-generating services such as our maintenance

solutions, see case study below, and our safety solutions

which include personal protective equipment (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.

SCALE OUR SERVICE

SOLUTIONS

61%

of revenue through

digital channels

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 higher-value customers as we

optimise our costs to serve. This will deliver sustainable cash

UHWXUQVDQGIXUWKHUGLࢆHUHQWLDWLRQIURPPDUNHWSODFHVDQG

pure digital players.

STRENGTHEN OUR

CUSTOMER EXPERIENCE

DELIVERING SUSTAINABLE

SOLUTIONS

In 2023/24, compressed air leak surveys

conducted by RS Maintenance Solutions

helped to identify energy losses of over

£2.3 million among 14 customers, with

the average return on investment to

repair faults taking less than six weeks.

Our sustainability solutions help

customers run their businesses more

HࢇFLHQWO\ FRVW HࢆHFWLYHO\ VDIHO\

and sustainably at all stages of the

industrial lifecycle.

Read more on page 46

2024 LEADERSHIP

EVENT

OUR PEOPLE IN ACTION

An opportunity for clarity and alignment

In March 2024, 193 of our senior leaders from across the world attended our leadership event in

(XURSH 7KH HYHQW JDYH WKHP WKH RSSRUWXQLW\ WR OHDUQ DERXW WKH UHࢉQHG *URXS VWUDWHJ\ DQG WKH

aligned regional strategies, presented by each of the regional presidents, as well as the updated

operating model.

7KHQHZYDOXHVZHUHXQYHLOHGDORQJZLWKKRZWKH\ࢉWZLWKRXUSXUSRVHYLVLRQ VWUDWHJ\ DQG

operating model. Our senior leaders left the event understanding how the values will help deliver

RXU VWUDWHJ\ PRUH HࢆHFWLYHO\ DQG WKH QHHG WR FOHDUO\ FRPPXQLFDWH WKHLU VLJQLࢉFDQFH WR WKHLU WHDPV

Strategy in action continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 16

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Operating

leverage

Geographic

opportunities

Product extensions

and adjacencies

Product and

service solutions

May 2018

Jan 2019

Dec 2020

Jan 2021

Feb 2021

Jun 2022

Jan 2023

Jun 2023

Apr 2024

Operating leverage Geographic opportunities

Product extensions and adjacencies Product and service solutions

Our growth ambitions

We see opportunities to continue to take market share across all our operating areas.

Market outperformance results from selling more product and service solutions to existing

and new customers, growing our branded and own-brand product range and leveraging

our digital and data capabilities to improve our customer service and experience. All of this

should increase our share of customer wallet and attract new customers.

With our disciplined investment criteria, we are accelerating organic growth by

adding high-quality, strategic acquisitions that will develop our:

ACQUISITIONS IN ACTION

Risoul

We acquired Mexico-based Risoul in January

2023. Since then, the business in Latin America

KDVRXWSHUIRUPHG RXUH[SHFWDWLRQV UHࢊHFWLQJ D

VWURQJPDUNHW DQG VSHFLDOLVW WHFKQLFDO VHUYLFH RࢆHU

:HVHHVLJQLࢉFDQWV\QHUJ\RSSRUWXQLWLHVDVZH

introduce RS Group’s digital capabilities and RS PRO,

our own-brand product range, into Risoul, as well

as the service learnings we can develop within RS

in Americas.

The launch of Risoul’s transactional website

in February 2024 has continued to solidify our

foundations in Latin America and will support

the future expansion of the business.

Distrelec

In June 2023, we completed the acquisition of

'LVWUHOHFZKLFKLVDVWURQJࢉWZLWK56LQ(0($,WZLOO

GHOLYHUVLJQLࢉFDQWFRVWVDYLQJVDQGGULYHLQFUHDVHG

revenue through our existing distribution capability

across Europe and has brought the addition of a

PXFKQHHGHG ORFDO IXOࢉOPHQW FHQWUH LQ 6ZLW]HUODQG

We are accelerating our initial integration plans with

our expected cost savings already exceeding those

anticipated when we made the initial acquisition.

2XU FXVWRPHUV ZLOO EHQHࢉW IURP FRPELQHG SURGXFW

and value-added solutions and our own-brand

product range, RS PRO, which is starting to prove

SRSXODU ZLWK 'LVWUHOHF FXVWRPHUV 6XSSOLHUV EHQHࢉW

from an unrivalled joint distribution network.

ACCELERATING

VALUE CREATION

OUR GROWTH

AMBITIONS

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 17

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

We listen, respect

and trust each other.

We seek diverse

perspectives.

We collaborate

with purpose as one

connected team.

We are empowered,

take ownership

and deliver what

customers need with

energy and passion.

We care about

our impact

on colleagues,

customers, suppliers

and communities,

today and tomorrow.

We are adaptable,

agile and inspired to

innovate and make

positive changes,

DOZD\VࢉQGLQJZD\V

to improve, challenge

and simplify.

Our values

OUR VALUES

WILL HELP US

SUCCEED

We are one team who deliver brilliantly by doing the right

thing to make every day better.

Our values are four guiding principles that outline what our people need to

do together to succeed. They are how we work across our organisation in a

FRQVLVWHQWZD\7KH\XQLWHXVLQKRZZHVKRXOGEHKDYHDQGGLࢆHUHQWLDWHXVIURP

our competition. Our values help us to build trust with our customers, suppliers

and investors. We have a clear plan of action and an ambition to improve the

way we operate and to build a purpose-led culture that we are all proud of.

7KH YDOXHVZLOOKHOSXVGHOLYHURXUVWUDWHJ\PRUHHࢆHFWLYHO\DQGZLWKEHWWHU

long-term outcomes for everyone.

2,500

survey responses

350

people joined our focus groups

RS Group plc

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

18Annual Report and Accounts for the year ended 31 March 2024

Our values continued

CONSISTENT

VALUES FOR ALL

Our values were created with the input of our people around the world.

To develop them, we evaluated 2,500 survey responses and gained feedback

from 350 of our people, customers and suppliers through focus groups, in

addition to garnering the perspectives of our senior leaders.

2024

We are rolling out and

embedding our new

values with our people.

We are encouraging

them to embrace the

values in their teams,

UHࢊHFWLQJKRZWKH\OLYH

WKHPDOUHDG\DQGZKHUH

WKH\FDQLPSURYH

We engaged with

VHQLRUOHDGHUVWRFOHDUO\

connect the values with

RXUVWUDWHJ\

We designed how the

new values would look

We mapped where our

new values would

appear across the

HPSOR\HHH[SHULHQFH

We briefed leaders and

line managers on the

rollout plans for our

new values

We issued a

questionnaire to over

a third of our people

to understand the

values that mattered

to them most

We developed local

versions of the new

values in our global

languages and then

tested them

languages

2,500

responses

We held face-to-face

workshops with 350 of

our people, customers

and suppliers to learn

more about their views

on values

We developed a rollout

plan to reach all our

people through 2024

hours

350

people

OUTCOME

One consistent set of values; embraced and demonstrated by all RS people

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 19

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Key performance indicators

2XUVL[ࢉQDQFLDONH\SHUIRUPDQFHLQGLFDWRUV

.3,VKHOSXVWRPHDVXUHWKHVXFFHVVIXO

LPSOHPHQWDWLRQRIRXUVWUDWHJ\DQG

monitor and drive our performance. The

IROORZLQJSDJHVSURYLGHGHWDLOVRIRXU.3,V

ZKLFKKDYHEHHQLQSODFHGXULQJ

8QGHURXUQHZOHDGHUVKLSZHKDYHEHHQ

UHYLHZLQJRXURSHUDWLRQDO.3,VDQG

GHYHORSLQJWKRVHWKDWHQVXUHDOLJQPHQWWR

RXUVWUDWHJLFDPELWLRQV7KHVHRSHUDWLRQDO

.3,VDUHEHLQJLQFRUSRUDWHGLQRXUEXVLQHVV

SHUIRUPDQFHUHYLHZVDQGZHZLOOUHSRUW

WKRVHPRVWUHOHYDQWDQGQRWFRPPHUFLDOO\

VHQVLWLYHLQRXU$QQXDO5HSRUWDQG$FFRXQWV

IRUWKH\HDUHQGLQJ0DUFK

FINANCIAL

KPIs

/LNHIRUOLNH

UHYHQXHJURZWK

$GMXVWHG



RSHUDWLQJ

SURࢉWFRQYHUVLRQ

$GMXVWHG



RSHUDWLQJ

SURࢉWPDUJLQ

$GMXVWHG



HDUQLQJVSHUVKDUH

(EPS)

(8)% 24.7% 10.6% 43.8p

23/2422/2321/2220/2119/20

(8)

23/2422/2321/2220/2119/20

25.8

22.0

28.4

29.7

24.7

23/2422/2321/2220/2119/20

11.3

9.4

12.5

13.5

10.6

23/2422/2321/2220/2119/20

37.7

31.3

51.3

63.6

43.8

%\GULYLQJDGLࢆHUHQWLDWHGFXVWRPHU

H[SHULHQFHDQGSURYLGLQJLQQRYDWLYH

VROXWLRQVZHDLPWRGULYHPDUNHW

VKDUHJDLQVDQGKLJKHUUHYHQXH

JURZWKZKLFKLQWXUQGULYHVSURࢉW

JURZWK/LNHIRUOLNHUHYHQXHJURZWK

LVDGMXVWHGIRUWUDGLQJGD\VFXUUHQF\

PRYHPHQWVDQGWRH[FOXGHWKH

LPSDFWRIDFTXLVLWLRQVXQWLOWKH\KDYH

EHHQRZQHGIRUD\HDU6HHSDJH

IRUIXUWKHUGHWDLOV

:HDUHFRQVWDQWO\VWULYLQJWRPDNH

RXURSHUDWLQJPRGHODVOHDQDQG

HࢇFLHQWDVSRVVLEOHVRZHFDQ

FRQYHUWDKLJKHUSHUFHQWDJHRIJURVV

SURࢉWLQWRDGMXVWHGRSHUDWLQJSURࢉW

2XUDLPLVWKDWHDFKUHJLRQHDFK

PDUNHWDQGHDFKLQGLYLGXDOWDNHV

UHVSRQVLELOLW\IRURXUSHUIRUPDQFH

DQGFRQVWDQWO\TXHVWLRQVZKHWKHU

ZHFDQGRWKLQJVPRUHHࢇFLHQWO\

WRGULYHJUHDWHUUHWXUQV6HHSDJH

IRUIXUWKHUGHWDLOV

$JUHDWFXVWRPHUH[SHULHQFH

KLJKSHUIRUPDQFHWHDPDQG

RSHUDWLRQDOH[FHOOHQFHVKRXOGDOO

GULYHLPSURYHPHQWLQDGMXVWHG

RSHUDWLQJSURࢉWPDUJLQ$KLJKHU

DGMXVWHGRSHUDWLQJSURࢉWPDUJLQ

VKRXOGGULYHKLJKHUUHWXUQVIRU

RXUVKDUHKROGHUV,WLVDGMXVWHG

RSHUDWLQJSURࢉWH[SUHVVHGDV

DSHUFHQWDJHRIUHYHQXH6HH

SDJHIRUIXUWKHUGHWDLOV

$GMXVWHG(36LVDPHDVXUHXVHG

E\LQYHVWRUVLQGHFLGLQJZKHWKHU

WRLQYHVWLQWKH&RPSDQ\,WLV

DPHDVXUHRIWKHJURZWKDQG

SURࢉWDELOLW\RIWKH&RPSDQ\WKDWDOVR

UHࢊHFWVPDQDJHPHQWSHUIRUPDQFH

6HHSDJHIRUIXUWKHUGHWDLOV

/LQNWRUHPXQHUDWLRQ

3HUIRUPDQFHPHDVXUH

LQDQQXDOLQFHQWLYH

/LQNWRUHPXQHUDWLRQ

3HUIRUPDQFHPHDVXUHLQ

ORQJWHUPLQFHQWLYHSODQ

 $GMXVWHGH[FOXGHVDPRUWLVDWLRQDQGLPSDLUPHQWRILQWDQJLEOH

DVVHWVDULVLQJRQDFTXLVLWLRQRIEXVLQHVVHVDFTXLVLWLRQUHODWHG

LWHPVVXEVWDQWLDOUHRUJDQLVDWLRQFRVWVVXEVWDQWLDODVVHW

ZULWHGRZQVRQHRࢆSHQVLRQFUHGLWVRUFRVWVVLJQLࢉFDQWWD[

UDWHFKDQJHVDQGDVVRFLDWHGLQFRPHWD[VHH1RWHRQSDJHV

WRIRUUHFRQFLOLDWLRQV

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 20

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

5HWXUQRQFDSLWDOHPSOR\HG

52&(

$GMXVWHG



RSHUDWLQJFDVK

ࢊRZFRQYHUVLRQ

17.4% 81.9%

23/2422/2321/2220/2119/20

24.0

19.4

28.7

30.8

17.4

23/2422/2321/2220/2119/20

62.1

100.3

70.8

92.0

81.9

52&(LVDPHDVXUHXVHGE\LQYHVWRUV

LQGHFLGLQJZKHWKHUWRLQYHVWLQWKH

&RPSDQ\$WLJKWIRFXVRQZRUNLQJ

FDSLWDOFRQWURODQGPRUHGLVFLSOLQHG

FDSLWDOLQYHVWPHQWFRXSOHGZLWK

LQFUHDVHGSURࢉWDELOLW\ZLOOGULYH

LPSURYHGUHWXUQVIRURXU

VKDUHKROGHUV52&(LVPHDVXUHG

DVDGMXVWHGRSHUDWLQJSURࢉW

H[SUHVVHGDVDSHUFHQWDJHRIWKH

PRQWKO\DYHUDJHRIQHWDVVHWV

H[FOXGLQJQHWGHEWDQGUHWLUHPHQW

EHQHࢉWREOLJDWLRQV6HHSDJH

IRUIXUWKHUGHWDLOV

7KURXJKWLJKWZRUNLQJFDSLWDO

PDQDJHPHQWDQGGLVFLSOLQHG

FDSLWDOLQYHVWPHQWZHDLPWR

FRQYHUWDKLJKSHUFHQWDJHRIRXU

RSHUDWLQJSURࢉWLQWRRSHUDWLQJ

FDVKࢊRZ$GMXVWHGRSHUDWLQJ

FDVKࢊRZFRQYHUVLRQLVGHࢉQHG

DVDGMXVWHGIUHHFDVKࢊRZEHIRUH

LQFRPHWD[DQGQHWLQWHUHVWSDLGDV

DSHUFHQWDJHRIDGMXVWHGRSHUDWLQJ

SURࢉW7KHKLJKHUWKHFRQYHUVLRQ

WKHPRUHFDVKZHKDYHDYDLODEOH

WRLQYHVWLQRXUEXVLQHVVWRGULYH

IXWXUHJURZWKDQGUHWXUQVIRU

RXUVKDUHKROGHUV6HHSDJHV

DQGIRUIXUWKHUGHWDLOV

/LQNWRUHPXQHUDWLRQ

8QGHUSLQLQORQJWHUPLQFHQWLYHSODQ

 $GMXVWHGH[FOXGHVWKHFDVKLPSDFWRIVXEVWDQWLDO

UHRUJDQLVDWLRQFRVWVDQGDFTXLVLWLRQUHODWHGLWHPVVHH

1RWHRQSDJH

1DYLJDWLQJWKURXJKRXU$VLD3DFLࢉFURDGPDSRYHUWKHSDVWIHZ\HDUVRQHRIRXUNH\UHJLRQDO

SULRULWLHVKDVEHHQWREXLOGDQLQFOXVLYHDQGGLYHUVHFXOWXUHWKDWVXSSRUWVWKHJURZWKRILGHDV

DQGWDOHQW$VRI$VLD3DFLࢉFQRZKDVWKHKLJKHVWSURSRUWLRQRIIHPDOHHPSOR\HHV

DFURVVWKH*URXSDWZLWKIHPDOHSHRSOHPDQDJHUVDQGIHPDOHVHQLRUOHDGHUV

7RHPEHGHࢆRUWVIXUWKHUWRHQKDQFHWKHGLYHUVLW\RIRXUZRUNIRUFHWRJURZDQGDWWUDFWQHZ

WDOHQWZHXSGDWHGRXUKLULQJSROLFLHVLQ$VLD3DFLࢉFWRHQFRXUDJHJHQGHUQHXWUDOKLULQJDQG

SURPRWHPRUHVHQLRUHPSOR\PHQWWKURXJKUHWXUQWRZRUNKLUHV7KURXJKWKHVHLQLWLDWLYHV

ZHDUHEHFRPLQJDQDWWUDFWLYHDQGZHOOUHFRJQLVHGHPSOR\HUDFURVVRXU$VLD3DFLࢉFORFDWLRQV

WRDWWUDFWWRSWDOHQW

)RUPRUHLQIRUPDWLRQRQGLYHUVLW\DQGLQFOXVLRQVHHSDJHVDQG

DIVERSE PEOPLE,

DIVERSE IDEAS

ESG IN ACTION

Key performance indicators FRQWLQXHG

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 21

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

CUSTOMER PEOPLE HEALTH AND SAFETY

*URXSUROOLQJPRQWK

Net Promoter Score (NPS)

(PSOR\HH

HQJDJHPHQW

3HUFHQWDJHRIPDQDJHPHQW

WKDWDUHZRPHQ

$OODFFLGHQWV

SHUKRXUV

50.6 75 34% 0.37

23/2422/2321/2220/2119/20

55.7

54.4

50.6

49.6

50.6

23/2422/2321/2220/2119/20

32%

30%

32%

30%

34%

23/2422/2321/2220/2119/20

0.69

0.44

0.53

0.40

0.37

7KHUHLVDVWURQJFRUUHODWLRQEHWZHHQ

KLJKFXVWRPHUOR\DOW\VFRUHVDQG

RXUࢉQDQFLDOSHUIRUPDQFH136LV

DFXVWRPHUVDWLVIDFWLRQPHDVXUH

$FKLHYLQJFRQVLVWHQWO\VWURQJ

FXVWRPHUVDWLVIDFWLRQUDWLQJVLVDNH\

SULRULW\DQGZLOOKHOSGULYHVWURQJHU

ࢉQDQFLDOSHUIRUPDQFH:HXSGDWHG

RXU136PHWKRGRORJ\IURP$SULO

WRPDNHLWPRUHUHSUHVHQWDWLYH

RIRXUFXVWRPHUEDVH7KHFKDQJHV

PDGHDUHWRZHLJKW136E\

SHUFHQWDJHRIRUGHUVVHSDUDWHRXW

%%IURP%&FXVWRPHUVZLWK%%

EHFRPLQJRXUSULPDU\PHWULFDQG

FXVWRPHUVWKDWRSWHGRXWRI

PDUNHWLQJFDQEHLQFOXGHGLQWKH

VXUYH\3ULRU\HDUVEHIRUH

KDYHQRWEHHQUHVWDWHG

7KHIXOࢉOPHQWRIRXUSHRSOHLQWKH

ZRUNSODFHLVDNH\SULRULW\2XUDLP

LVWRLQFUHDVHHPSOR\HHHQJDJHPHQW

E\EXLOGLQJDGLYHUVHDQGFXVWRPHU

FHQWULFFXOWXUHDQGRࢆHULQJWKH

ULJKWWUDLQLQJDQGGHYHORSPHQW

RSSRUWXQLWLHV7KHUHZDVDSRLQW

GHFUHDVHLQIURPWR

GXHWRXQFHUWDLQW\DURXQGJOREDO

HFRQRPLFFKDOOHQJHVDQG

RUJDQLVDWLRQDOFKDQJHV,QUHVSRQVH

ZHKDYHFODULࢉHGRXUH[HFXWLYHWHDP

VWUDWHJ\YDOXHVDQGRSHUDWLQJ

PRGHODQGUHࢉQHGRXUSHRSOHSODQ

WRIRFXVRQWDOHQWFDSDELOLW\FXOWXUH

DQGUHZDUG6HHSDJHIRUIXUWKHU

GHWDLOV

(PSRZHULQJRXUSHRSOHWREULQJ

WKHLUWUXHVHOIWRZRUNFUHDWHVD

FXOWXUHRIH[FHOOHQFHZKHUHHYHU\RQH

FDQWKULYH*HQGHUGLYHUVLW\LQ

OHDGHUVKLSLVDNH\DFWLRQRIRXU

(6*DFWLRQSODQDQGDPHDVXUHLQRXU

VXVWDLQDELOLW\OLQNHGORDQ6//:H

ZHUHSOHDVHGWRVHHWKHSHUFHQWDJH

RIIHPDOHOHDGHUVLQFUHDVHE\

SHUFHQWDJHSRLQWVWRGXULQJWKH

\HDU6HHSDJHVDQGIRUIXUWKHU

GHWDLOV

:HFRQWLQXHWRPDNHSURJUHVV

WRZDUGVWKHORQJWHUPWDUJHWRI

]HURDFFLGHQWVRQWKHEDVLVWKDWDOO

DFFLGHQWVDUHSUHYHQWDEOH$VDIH

ZRUNLQJHQYLURQPHQWLVFULWLFDOIRU

WKHZHOOEHLQJRIRXUHPSOR\HHV

DQGWKHVXFFHVVRIRXUEXVLQHVV

2XUDOODFFLGHQWUDWHFRQWLQXHVWR

LPSURYHZLWKDQUHGXFWLRQIURP

DQGDUHGXFWLRQVLQFH

WKHEDVHOLQH6HHSDJH

IRUIXUWKHUGHWDLOV

/LQNWRUHPXQHUDWLRQ

3HUIRUPDQFHPHDVXUH

LQDQQXDOLQFHQWLYH

/LQNWRUHPXQHUDWLRQ

3HUIRUPDQFHPHDVXUHLQ

ORQJWHUPLQFHQWLYHSODQ

Key performance indicators FRQWLQXHG

:HUHSRUWHLJKWQRQࢉQDQFLDO.3,VWKDWKHOS

PHDVXUHSURJUHVVDJDLQVWRXUVWUDWHJLFDFWLRQV

DQGRXUFRPPLWPHQWWRRXUSHRSOHDQGFXOWXUH

NON-FINANCIAL

KPIs

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 22

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

ENVIRONMENT

&DUERQLQWHQVLW\



WRQQHVRI&2



HGXHWR6FRSHDQG

HPLVVLRQVePUHYHQXH

&DUERQHPLVVLRQV



WRQQHVRI&2



HGXHWR

6FRSHDQGHPLVVLRQV

3DFNDJLQJLQWHQVLW\



WRQQHVePUHYHQXH

Waste



RIZDVWHUHF\FOHG

2.3 6,800 1.57 82%

23/2422/2321/2220/2119/20

6.2

3.8

2.4

1.9

2.3

23/2422/2321/2220/2119/20

11,900

7,500

6,300

5,700

6,800

23/2422/2321/2220/2119/20

2.43

2.35

2.05

1.70

1.57

23/2422/2321/2220/2119/20

79%

76%

74%

76%

82%

:HUHFRJQLVHWKHUROHDQG

UHVSRQVLELOLWLHVZHKDYHDVD

JOREDOEXVLQHVVWRDGGUHVVRXU

HQYLURQPHQWDOLPSDFWVDQGKHOS

WDFNOHFOLPDWHFKDQJH2XUDLPLVWR

GHFRXSOHRXUEXVLQHVVJURZWKIURP

RXUFDUERQIRRWSULQWDQGZHKDYH

UHGXFHGRXUFDUERQLQWHQVLW\E\

VLQFH&DUERQLQWHQVLW\LQ

KDVEHHQLPSDFWHGE\WKH

LQWHJUDWLRQRIHPLVVLRQVGDWDIURP

RXUDFTXLVLWLRQVFRPSOHWHGLQ

DQGDVZHOO

DV*URXSUHYHQXHSHUIRUPDQFH6HH

SDJHVDQGIRUIXUWKHUGHWDLOV

:HWDUJHWDEVROXWHFDUERQ

UHGXFWLRQLQOLQHZLWKRXUQHW]HUR

DFWLRQSODQDQGWKLVLVDPHDVXUHLQ

RXUHPSOR\HHUHZDUGVSURJUDPPH

DQG6//([FOXGLQJUHFHQW

DFTXLVLWLRQVZHUHGXFHGRXUGLUHFW

HPLVVLRQVE\IURPDQG

E\VLQFH:KHQ

LQWHJUDWLQJSRVWDFTXLVLWLRQ

HPLVVLRQVGDWDIURPDFTXLVLWLRQV

FRPSOHWHGLQDQG

GLUHFWHPLVVLRQVLQFUHDVHGWR

WRQQHV&2



H:HDUHSURDFWLYHO\

ZRUNLQJZLWKRXUDFTXLUHG

EXVLQHVVHVWRGHYHORSDQG

LPSOHPHQWWKHLUGHFDUERQLVDWLRQ

SURJUDPPHVWRVWD\RQWUDFNZLWK

RXUDPELWLRQWREHQHW]HURLQRXU

GLUHFWRSHUDWLRQVE\6HHSDJHV

DQGIRUIXUWKHUGHWDLOV

2XUDLPLVWRSURYLGHWKHEHVW

FXVWRPHUH[SHULHQFHLQWKHPRVW

VXVWDLQDEOHZD\:HZRUNDFURVV

RXUQHWZRUNRIGLVWULEXWLRQVLWHVWR

UHGXFHSDFNDJLQJZKLOHLQFUHDVLQJ

UHF\FOHGFRQWHQWDQGUHF\FODELOLW\

7KLVLVDPHDVXUHLQRXU6//

3HUIRUPDQFHLPSURYHGE\

GXULQJWKH\HDUZLWKSRVLWLYH

SURJUHVVDFKLHYHGE\UHGXFLQJ

FXVWRPHUSDFNDJLQJDQGXVLQJ

UHXVDEOHHFRWRWHVLQLQWHUQDO

V\VWHPV6LQFHZHKDYH

UHGXFHGSDFNDJLQJLQWHQVLW\E\

6HHSDJHIRUIXUWKHUGHWDLOV

(QVXULQJZHDUHDEOHWRJURZDQG

VFDOHWKHEXVLQHVVLQDVXVWDLQDEOH

ZD\LVNH\,QDGGLWLRQWRVHJUHJDWLQJ

ZDVWHPDWHULDOVIRUUHF\FOLQJZH

LPSOHPHQWZDVWHUHGXFWLRQLQLWLDWLYHV

LQWHUQDOO\DQGE\ZRUNLQJZLWKRXU

VXSSOLHUV3HUIRUPDQFHLPSURYHG

GXULQJWKH\HDUZLWKDSHUFHQWDJH

SRLQWVLPSURYHPHQWIURP

6HHSDJHIRUIXUWKHUGHWDLOV

/LQNWRUHPXQHUDWLRQ

3HUIRUPDQFHPHDVXUH

LQDQQXDOLQFHQWLYH

 .3,VDUHRQDFRQVWDQWH[FKDQJHUDWHVEDVLVDQGDUHXSGDWHGWRUHࢊHFWFKDQJHVLQ

UHSRUWLQJPHWKRGRORJ\GDWDLQFOXGHVEXVLQHVVHVDFTXLUHGLQDQG

GDWDDOVRXSGDWHGWRLQFOXGHEXVLQHVVHVDFTXLUHGLQWKDW\HDU

Key performance indicators FRQWLQXHG

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 23

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

PERFORMANCE IN

A CHALLENGING

ENVIRONMENT

Financial review

Our ﬁnancial performance reﬂects the

challenging market and unwinding of our

unusualpost-pandemic trading beneﬁt.”

Overall results

2024 2023 Change

Like-for-like

change

Revenue £2,942m £2,982m (1)% (8)%

*URVVSURࢉW £1,264m £1,352m (7)% (11)%

Gross margin 43.0% 45.3% SWV SWV

2SHUDWLQJSURࢉW £280m £383m (27)% (25)%

$GMXVWHG

RSHUDWLQJSURࢉW £312m £402m (22)% (25)%

$GMXVWHG

RSHUDWLQJSURࢉWPDUJLQ 10.6% 13.5% SWV SWV

$GMXVWHG

RSHUDWLQJSURࢉWFRQYHUVLRQ 24.7% 29.7% SWV SWV

3URࢉWEHIRUHWD[ £249m £372m (33)% (31)%

$GMXVWHG

SURࢉWEHIRUHWD[ £281m £391m (28)% (30)%

Earnings per share 38.8p 60.4p (36)% (34)%

$GMXVWHG

earnings per share 43.8p 63.6p (31)% (34)%

&DVKJHQHUDWHGIURPRSHUDWLRQV £301m £413m (27)%

$GMXVWHG

IUHHFDVKࢊRZ £151m £264m (43)%

$GMXVWHG

RSHUDWLQJFDVKIORZFRQYHUVLRQ 81.9% 92.0% SWV

1HWGHEW £418m £113m

1HWGHEWWRDGMXVWHG

EBITDA 1.1x [

5HWXUQRQFDSLWDOHPSOR\HG 17.4% 30.8%

Dividend per share 22.0p 20.9p 5%

 /LNHIRUOLNHFKDQJHH[FOXGHVWKHLPSDFWRIDFTXLVLWLRQVDQGWKHHࢆHFWVRIFKDQJHVLQH[FKDQJH

UDWHVRQWUDQVODWLRQRIRYHUVHDVRSHUDWLQJUHVXOWVZLWKFRQYHUWHGDWDYHUDJH

H[FKDQJHUDWHV5HYHQXHLVDOVRDGMXVWHGWRHOLPLQDWHWKHLPSDFWRIWUDGLQJGD\V\HDURQ\HDU

$FTXLVLWLRQVDUHRQO\LQFOXGHGRQFHWKH\KDYHEHHQRZQHGIRUD\HDUDWZKLFKSRLQWWKH\VWDUWWR

EHLQFOXGHGLQERWKWKHFXUUHQWDQGFRPSDUDWLYHSHULRGVIRUWKHVDPHQXPEHURIPRQWKVVHH

1RWHRQSDJHVWRIRUUHFRQFLOLDWLRQV

 $GMXVWHGH[FOXGHVDPRUWLVDWLRQDQGLPSDLUPHQWRILQWDQJLEOHDVVHWVDULVLQJRQDFTXLVLWLRQ

RI EXVLQHVVHVDFTXLVLWLRQUHODWHGLWHPVVXEVWDQWLDOUHRUJDQLVDWLRQFRVWVVXEVWDQWLDODVVHW

ZULWHGRZQVRQHRࢆSHQVLRQFUHGLWVRUFRVWVVLJQLࢉFDQWWD[UDWHFKDQJHVDQGDVVRFLDWHG

LQFRPHWD[VHH1RWHRQSDJHVWRIRUUHFRQFLOLDWLRQV

Kate Ringrose

CFO

Revenue

£2,942m

Change: (1)%

eP

Like-for-like

revenue growth

(8)%



2SHUDWLQJSURࢉW

£280m

Change: (27)%

eP

Adjusted

RSHUDWLQJSURࢉW

£312m

/LNHIRUOLNH

FKDQJH

eP

Adjusted

operating

SURࢉWPDUJLQ

10.6%



Net debt

£418m

eP

Annual Report and Accounts for the year ended 31 March 2024 24

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

RS Group plc

Revenue

*URXSUHYHQXHGHFUHDVHGE\WRePLOOLRQ

/LNHIRUOLNHUHYHQXHGHFOLQHGDIWHUDGMXVWLQJ

IRUWKHePLOOLRQFRQWULEXWLRQIURPDFTXLVLWLRQV

ePLOOLRQIURPDGYHUVHH[FKDQJHUDWH

PRYHPHQWVDQGDQHJDWLYHLPSDFWRIePLOOLRQ

IURPIHZHUWUDGLQJGD\V7UDGLQJSHUIRUPDQFH

ZDVDࢆHFWHGE\WKHFKDOOHQJLQJPDFURHFRQRPLF

HQYLURQPHQWDQGWKHXQZLQGLQJRIRXU

SRVWSDQGHPLFWUDGLQJWDLOZLQGV

56EHQHࢉWHGIURPVWURQJSRVWSDQGHPLFWUDGLQJ

WKDWERRVWHGRXUࢉQDQFLDOSHUIRUPDQFHLQ

DQGGXHWRH[FHOOHQWSURGXFWDYDLODELOLW\

ZKHQJOREDOVXSSO\FKDLQVZHUHFRQVWUDLQHG

HQKDQFLQJRXUUHYHQXHDQGSURࢉWRYHUWKH

WZR\HDUSHULRG:HHVWLPDWHWKLVEHQHࢉW

FRQWULEXWHGFePLOOLRQRIUHYHQXHGXULQJ

ZKLFKKDVVLQFHXQZRXQGDVJOREDO

VXSSO\FKDLQLVVXHVHDVHGDQGRXUFXVWRPHUV

UHGXFHGWKHLUKLJKLQYHQWRU\OHYHOVUHGXFLQJ

RXUOLNHIRUOLNHUHYHQXHE\FGXULQJ

7KHXQZLQGRIWKHWDLOZLQGVLVPRVWHYLGHQWLQ

HOHFWURQLFVDQG$&FDWHJRULHVDQGWKURXJKWKH

UHGXFWLRQLQWKHQXPEHURIRQHRࢆORZYDOXH

DQGWUDQVLWRU\FXVWRPHUV

&XVWRPHUQXPEHUVZHUHࢊDWDWPLOOLRQEXW

RQDOLNHIRUOLNHEDVLVGHFUHDVHGE\PLOOLRQ

WKHPDMRULW\RIZKLFKZHUHRQHRࢆORZYDOXH

FXVWRPHUVWKDWZHDWWUDFWHGGXULQJWKH

SRVWSDQGHPLFWUDGLQJDQGKDYHQRZUHWXUQHGWR

WKHLUQRUPDOSURFXUHPHQWFKDQQHOV/DUJHU

FRUSRUDWHDQGNH\DFFRXQWFXVWRPHUQXPEHUV

ZHUHVWDEOH2XUDYHUDJHRUGHUYDOXH$29

H[FOXGLQJ56,QWHJUDWHG6XSSO\ȆVSDVVWKURXJK

VDOHVRUGHUVJUHZPDUJLQDOO\WReIURPe

7KLVUHࢊHFWHG5LVRXOȆVKLJKHU$29DVPDOOLQFUHDVH

LQ(0($DQGDUHGXFWLRQLQ$PHULFDVZKLFKZDV

LPSDFWHGE\FXVWRPHUGHVWRFNLQJ

2XULQGXVWULDOSURGXFWDQGVHUYLFHVROXWLRQV

UDQJHVZKLFKDFFRXQWIRURI*URXSUHYHQXH

GHFUHDVHGE\OLNHIRUOLNH7KLVZDVDIXQFWLRQ

RIDZHDN$&SURGXFWFDWHJRU\RI*URXS

UHYHQXHZKHUHSHUIRUPDQFHLVPRVWFRUUHODWHG

ZLWKWKHHOHFWURQLFVF\FOHRࢆVHWWLQJJURZWKLQDOO

RWKHUFDWHJRULHVDVWKHSRVWSDQGHPLFWUDGLQJ

WDLOZLQGVHVSHFLDOO\LQ$PHULFDVXQZRXQG7KH

PDFURHFRQRPLFHQYLURQPHQWZDVFKDOOHQJLQJDV

LOOXVWUDWHGE\WKHGHWHULRUDWLQJ3XUFKDVLQJ

0DQDJHU,QGH[30,DQGLQGXVWULDOSURGXFWLRQ

ࢉJXUHVDFURVVRXUPDLQPDUNHWV

2XUHOHFWURQLFVSURGXFWDQGVHUYLFHVROXWLRQV

UDQJHDFFRXQWVIRURI*URXSUHYHQXH

/LNHIRUOLNHHOHFWURQLFVUHYHQXHGHFUHDVHGE\

UHࢊHFWLQJWKHWRXJKFRPSDUDWLYHVLQWKHSULRU

SHULRGGXHWRWKHYHU\VWURQJSHUIRUPDQFHRYHU

WKHODVWWZR\HDUVDQGWKHXQZLQGRISULFHLQࢊDWLRQ

'LJLWDODFFRXQWLQJIRURI*URXSUHYHQXH

SHUIRUPHGVOLJKWO\DKHDGRIWKH*URXSRYHUDOO

ZLWKDOLNHIRUOLNHUHYHQXHGHFOLQHRI7KHࢊDW

OLNHIRUOLNHSHUIRUPDQFHIURPH3URFXUHPHQWDQG

SXUFKDVLQJPDQDJHUZKLFKGULYHVSURGXFWSXOO

WKURXJKDQGFXVWRPHUOR\DOW\GHPRQVWUDWHVWKH

EHQHࢉWRIWDUJHWLQJKLJKHUOLIHWLPHYDOXH

FXVWRPHUV:HEUHYHQXHGHFUHDVHGE\RQ

DOLNHIRUOLNHEDVLVUHࢊHFWLQJOHVVWUDࢇFIURP

PRUHWUDQVLWRU\FXVWRPHUV

56352RXUPDLQRZQEUDQGSURGXFWUDQJH

DFFRXQWVIRURI*URXSUHYHQXHDQGJUHZE\

OLNHIRUOLNHDVWKHEUDQGH[WHQGHGLWVSURGXFW

EUHDGWKE\FDQGIRFXVHGLWVHQGWRHQG

VDOHVDQGPDUNHWLQJLQWKHUHJLRQV,WDOVR

EHQHࢉWHGIURPWKHUHEDGJLQJRIRXUVDIHW\

VROXWLRQVRZQEUDQGVWR563522XUFRPSHWLWLYHO\

SULFHGRࢆHUFRQWLQXHVWRJDLQWUDFWLRQDVDTXDOLW\

DOWHUQDWLYHWREUDQGHGUDQJHVZLWKTXDOLW\

DVVXUDQFHTXDOLࢉFDWLRQVLQKRXVHGHVLJQDQG

WHVWLQJIDFLOLWLHV

6HUYLFHVROXWLRQVUHYHQXHDVVRFLDWHGZLWK

RIRXU*URXSUHYHQXHLQFUHDVHGE\

OLNHIRUOLNH7KLVLVPDLQO\GXHWRDOLNHIRUOLNH

LQFUHDVHLQSURFXUHPHQWVROXWLRQVDQGLQDGGLWLRQ

JURZWKLQ56,QWHJUDWHG6XSSO\OLNHIRUOLNH

UHYHQXHUHࢊHFWLQJDGGLWLRQDOFRQWUDFWZLQVDQG

RQJRLQJVWURQJFXVWRPHUUHWHQWLRQ

2,942

2,982

23/24

revenue

22/23

revenue

(57)

Currency

movement

2,925

22/23 at

constant

exchange

rates

(24)

Trading

day

movement

282

Acquisitions

(241)

Like-

for-like

change

(8)%

Like-for-like revenue development

£m

Gross margin

*URXSJURVVPDUJLQGHFUHDVHGSHUFHQWDJH

SRLQWVWRRIZKLFKSHUFHQWDJHSRLQWV

ZDVDIXQFWLRQRIWKHGLOXWLYHLPSDFWIURPRXU

UHFHQWDFTXLVLWLRQVGXHWRWKHLUORZHUGLJLWDODQG

RZQEUDQGSURGXFWSDUWLFLSDWLRQFRPSDUHGWR

WKHUHVWRIWKH*URXS/LNHIRUOLNHJURVVPDUJLQ

GHFUHDVHGSHUFHQWDJHSRLQWVDVSRVWSDQGHPLF

WUDGLQJEHQHࢉWVUHYHUVHGDQGLQࢊDWLRQJDLQV

XQZRXQGHVSHFLDOO\ZLWKLQHOHFWURQLFVSURGXFWV

7KHUHZDVDQDGGLWLRQDOLQYHQWRU\LPSDLUPHQWIRU

VORZPRYLQJSURGXFWZLWKLQ2.GR

*URVVSURࢉWIHOOE\RQDOLNHIRUOLNHEDVLV

7KHFRPELQHGHࢆHFWRIWKHSRVWSDQGHPLFWUDGLQJ

EHQHࢉWLQOLNHIRUOLNHUHYHQXHDQGVKRUWWHUP

JURVVPDUJLQLPSURYHPHQWOHGWRFePLOOLRQ

EHQHࢉWWRRXUJURVVSURࢉWLQZKLFK

UHGXFHGRXUOLNHIRUOLNHJURVVSURࢉWE\F

GXULQJ

Operating costs

2SHUDWLQJFRVWVLQFOXGLQJUHJLRQDODQGFHQWUDO

FRVWVLQFUHDVHGE\([FOXGLQJWKHLPSDFWRI

DFTXLVLWLRQVWKHEHQHࢉWRIFXUUHQF\PRYHPHQWV

DPRUWLVDWLRQDQGLPSDLUPHQWRIDFTXLUHG

LQWDQJLEOHVDQGDFTXLVLWLRQUHODWHGLWHPVDGMXVWHG

RSHUDWLQJFRVWVUHGXFHGE\OLNHIRUOLNHZLWK

ORZHUYDULDEOHVXSSO\FKDLQFRVWVDQGDQQXDO

LQFHQWLYHDFFUXDOVPRUHWKDQRࢆVHWWLQJVDODU\FRVW

LQFUHDVHVDQGLQࢊDWLRQLQUDWHVDQGXWLOLWLHV

$ODUJHSURSRUWLRQRIRXURSHUDWLQJFRVWVUHODWHV

WRRXUSHRSOH:HDZDUGHGDPLGVLQJOHGLJLWSD\

LQFUHDVHDFURVVWKH*URXSZKLFKLQFOXGHGDQ

DERYHDYHUDJHLQFUHDVHIRURXUQRQPDQDJHPHQW

HPSOR\HHVLQPRVWPDUNHWVLQUHFRJQLWLRQRIWKH

JUHDWHULPSDFWRILQࢊDWLRQDU\SUHVVXUHV*LYHQ

RXUࢉQDQFLDOSHUIRUPDQFHGXULQJRXU

DQQXDOLQFHQWLYHDFFUXDOVDQGVKDUHEDVHG

SD\PHQWVUHGXFHGDQGWKHUHZDVQRUHSHDWRIWKH

ePLOOLRQDGKRFFRVWRIOLYLQJSD\PHQWVPDGHLQ

WKHSULRU\HDUHTXDWLQJWRDePLOOLRQWRWDO

UHGXFWLRQ:HDQWLFLSDWHWRLQFOXGH

LPSURYHGHPSOR\HHDQQXDOLQFHQWLYHV

:HFRQWLQXHWRLQYHVWLQRXUSURFHVVHVV\VWHPV

DQGLQIUDVWUXFWXUHWRERWKVXSSRUWJURZWKDQG

HࢇFLHQF\:HLQYHVWHGePLOOLRQGXULQJWKH

\HDUDQGZLOOFRQWLQXHWRLPSURYHRXUGLJLWDODQG

FRPPHUFLDOFDSDELOLWLHVFXVWRPHUH[SHULHQFH

DQGGDWDDQDO\WLFV:HDUHDOVRVLPSOLI\LQJRXU

WHFKQRORJ\SODWIRUPWRVXSSRUWVWDQGDUGLVHG

SURFHVVHV:HH[SHFWWRLQYHVWDQLQFUHPHQWDO

ePLOOLRQDWRWDORIFePLOOLRQGXULQJ

DVZHFRQWLQXHWRZLGHQRXUGLࢆHUHQWLDOZLWK

RXUFRPSHWLWRUV7KHUHZDVDQDGGLWLRQDOePLOOLRQ

RIFRVWVUHODWLQJWRWHFKQRORJ\LPSDLUPHQWV

7KHFDSLWDOLQYHVWPHQWZHKDYHPDGHLQUHFHQW

\HDUVLQRXUVXSSO\FKDLQQHWZRUNDQGUHJLRQDO

'&H[SDQVLRQVLQ)RUW:RUWK86DQG%DG+HUVIHOG

*HUPDQ\FRQWLQXHWRVHHLPSURYHGRSHUDWLRQDO

HࢇFLHQF\DQGUHGXFHGFRVWWRVHUYH2XUIUHLJKW

FRVWVLQFRQWLQHQWDO(XURSHH[FOXGLQJ'LVWUHOHF

KDYHUHGXFHGGXHWRORZHUYROXPHVDQGRSWLPLVHG

LQYHQWRU\VRXUFLQJDQGVWRFNLQJ

:HDUHWDNLQJDFWLRQWRPDQDJHRXURSHUDWLQJ

FRVWVPRUHHࢆHFWLYHO\,Q1RYHPEHUZH

LGHQWLࢉHGRYHUePLOOLRQRIDQQXDOLVHGVDYLQJV

:HGHOLYHUHGePLOOLRQRIVDYLQJVGXULQJWKH\HDU

ZLWKePLOOLRQRIDVVRFLDWHGFRVWVLQFXUUHGDQGD

IXUWKHUePLOOLRQRILQWHJUDWLRQFRVWVIRUWKH

'LVWUHOHFDFTXLVLWLRQV'XULQJZHH[SHFW

WRVSHQGDIXUWKHUFePLOOLRQWRGHOLYHUIXUWKHU

LQ\HDUEHQHࢉWVRIFePLOOLRQ

Financial review FRQWLQXHG

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 25

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Financial review FRQWLQXHG

&HQWUDOFRVWV*URXSVWUDWHJLFLQYHVWPHQW%RDUG

*URXS)LQDQFHDQG*URXS3URIHVVLRQDO6HUYLFHV

DQG3HRSOHFRVWVGHFUHDVHGE\ePLOOLRQWR

ePLOOLRQ7KLVLVODUJHO\EHFDXVHRIORZHU

VKDUHEDVHGSD\PHQWVDQGDQQXDOLQFHQWLYH

FRVWVKLJKOLJKWHGHDUOLHU:HDUHUHDVVHVVLQJWKH

GHࢉQLWLRQRIFHQWUDOFRVWVDQGZLOOOLPLWLWWR*URXS

+HDG2ࢇFHDFWLYLW\ZKLFKZLOOUHVXOWLQVRPHRI

RXUFHQWUDOFRVWVEHLQJDWWULEXWHGWRWKHUHJLRQV

LQ

$GMXVWHGRSHUDWLQJFRVWVDVDSHUFHQWDJHRI

UHYHQXHLQFUHDVHGE\SHUFHQWDJHSRLQWV

WR([FOXGLQJWKHLPSDFW

RIDFTXLVLWLRQLQWHJUDWLRQFRVWVLPSDLUPHQWVDQG

UHVWUXFWXULQJFRVWVDGMXVWHGRSHUDWLQJFRVWVDV

DSHUFHQWDJHRIUHYHQXHZRXOGKDYHEHHQ

$GMXVWHGRSHUDWLQJSURࢉWFRQYHUVLRQLV

SHUFHQWDJHSRLQWVORZHUDW

2SHUDWLQJSURࢉW

2SHUDWLQJSURࢉWGHFUHDVHGE\WRePLOOLRQ

([FOXGLQJWKHLPSDFWRIDFTXLVLWLRQVDQGWKH

DGYHUVHLPSDFWRIFXUUHQF\PRYHPHQWVDGMXVWHG

RSHUDWLQJSURࢉWVDZDOLNHIRUOLNHGHFUHDVHRI

:HHVWLPDWHWKDWRSHUDWLQJSURࢉW

EHQHࢉWHGE\FePLOOLRQIURPWKHSRVWSDQGHPLF

WUDGLQJWDLOZLQGVZKLFKXQZRXQGGXULQJ

FRQWULEXWLQJFRIWKHOLNHIRUOLNHDGMXVWHG

RSHUDWLQJSURࢉWGHFUHDVH7KLVLVFePLOOLRQ

KLJKHUWKDQUHSRUWHGDWWKHࢉUVWKDOIUHVXOWV

1RYHPEHUDVZHHVWLPDWHWKHUHZDVDOVR

DJURVVPDUJLQEHQHࢉWDFURVVRXUWRWDO*URXS

UHYHQXHIURPSULFHLQࢊDWLRQ$GMXVWHGRSHUDWLQJ

SURࢉWPDUJLQGHFOLQHGE\SHUFHQWDJHSRLQWV

WR

402

22/23

adjusted

operating

profit

(12)

Currency

movement

390

22/23

constant

exchange

rates

Acquisitions

(96)

Like-

for-like

change

(25)%

312

23/24

adjusted

operating

profit

Like-for-like adjusted operating

profit movement

£m

,WHPVH[FOXGHGIURPDGMXVWHGSURࢉW

7RLPSURYHWKHFRPSDUDELOLW\RILQIRUPDWLRQ

EHWZHHQUHSRUWLQJSHULRGVDQGEHWZHHQ

EXVLQHVVHVZLWKVLPLODUDVVHWVWKDWZHUH

LQWHUQDOO\JHQHUDWHGZHH[FOXGHFHUWDLQ

LWHPVIURPDGMXVWHGSURࢉWPHDVXUHV7KHLWHPV

H[FOXGHGDUHGHVFULEHGEHORZVHH1RWHRQ

SDJHVWRIRUGHࢉQLWLRQVDQGUHFRQFLOLDWLRQV

RIDGMXVWHGPHDVXUHV

Amortisation and impairment of

acquired intangibles

$PRUWLVDWLRQRIDFTXLUHGLQWDQJLEOHVZDV

ePLOOLRQDPRUWLVDWLRQDQGLPSDLUPHQW

RIDFTXLUHGLQWDQJLEOHVePLOOLRQDQGUHODWHV

WRWKHLQWDQJLEOHDVVHWVDULVLQJIURPDFTXLVLWLRQV

Acquisition-related items

$FTXLVLWLRQUHODWHGLWHPVRIePLOOLRQDUH

SUHGRPLQDQWO\WUDQVDFWLRQFRVWVZKLFKDUHGLUHFWO\

DWWULEXWDEOHWRWKHDFTXLVLWLRQRI'LVWUHOHF

1HWࢉQDQFHFRVWV

1HWࢉQDQFHFRVWVZHUHePLOOLRQXSIURP

ePLOOLRQPDLQO\GXHWRWKHLPSDFWRILQFUHDVHG

QHWGHEWUHVXOWLQJIURPWKHDFTXLVLWLRQVRI

'LVWUHOHFDQG5LVRXODQGKLJKHULQWHUHVWUDWHV

$W0DUFKRIWKH*URXSȆVJURVV

ERUURZLQJVH[FOXGLQJOHDVHOLDELOLWLHV

ZHUHDWࢉ[HGUDWHVZLWK

VXUSOXVFDVKGHSRVLWHGDWYDULDEOHUDWHV

3URࢉWEHIRUHWD[

3URࢉWEHIRUHWD[GHFOLQHGWRePLOOLRQ

$GMXVWHGSURࢉWEHIRUHWD[ZDVGRZQWR

ePLOOLRQRQDOLNHIRUOLNHEDVLV

249

23/24

profit

before tax

Amortisation

of acquired

intangibles

Acquisition-

items

23/24

adjusted

profit

before tax

281

Adjusted profit before tax reconciliation

£m

Taxation

7KH*URXSȆVLQFRPHWD[FKDUJHZDVePLOOLRQ

ePLOOLRQ7KHDGMXVWHGLQFRPHWD[

FKDUJHZKLFKH[FOXGHVDFTXLVLWLRQUHODWHGWD[

LWHPVDQGWKHLPSDFWRIWD[UHOLHIRQLWHPV

H[FOXGHGIURPDGMXVWHGSURࢉWEHIRUHWD[ZDV

ePLOOLRQePLOOLRQUHVXOWLQJLQDQ

HࢆHFWLYHWD[UDWHRIRQDGMXVWHGSURࢉWEHIRUH

WD[7KLVUHࢊHFWHGWKHFKDQJHLQ

WKH8.WD[UDWHIURPWRHࢆHFWLYHIURP

$SULO*RLQJIRUZDUGZHH[SHFWWKH

HࢆHFWLYHWD[UDWHRQDGMXVWHGSURࢉWEHIRUHWD[WR

EHF

Earnings per share

(DUQLQJVSHUVKDUHGHFOLQHGE\WRS

$GMXVWLQJIRULWHPVH[FOXGHGIURPDGMXVWHGSURࢉW

DQGDVVRFLDWHGLQFRPHWD[HࢆHFWVDGMXVWHG

HDUQLQJVSHUVKDUHRISGHFOLQHGRQ

DOLNHIRUOLNHEDVLV

&DVKࢊRZ

/RZHU(%,7'$HDUQLQJVEHIRUHLQWHUHVWWD[

GHSUHFLDWLRQDQGDPRUWLVDWLRQZDVFRPSRXQGHG

E\DVXEVWDQWLDORXWࢊRZLQSD\DEOHVRIePLOOLRQ

7KLVGHFUHDVHLQSD\DEOHVZDVGXHWRKLJKEDODQFHV

DW0DUFKUHODWLQJWRȆVLQFUHDVHLQ

LQYHQWRU\DQGORZHUDFFUXDOVGXHWRWKHVORZGRZQ

LQWKHEXVLQHVVDQGORZHUDQQXDOLQFHQWLYHDFFUXDOV

6XPPDU\FDVKࢊRZ

£m 2024 2023

2SHUDWLQJSURࢉW 280 383

$GGEDFNGHSUHFLDWLRQDQGDPRUWLVDWLRQ 84 65

EBITDA 364 448

$GGEDFNLPSDLUPHQWVDQGORVVRQGLVSRVDORIQRQFXUUHQWDVVHWV 7 12

0RYHPHQWLQZRUNLQJFDSLWDO (69) (49)

'HࢉQHGEHQHࢉWUHWLUHPHQWFRQWULEXWLRQVLQH[FHVVRIFKDUJH (10) (11)

0RYHPHQWLQSURYLVLRQV 1 (1)

2WKHU 8 15

Cash generated from operations 301 413

1HWFDSLWDOH[SHQGLWXUH (52) (46)

2SHUDWLQJFDVKࢊRZ 249 367

$GGEDFNFDVKHࢆHFWRIDGMXVWPHQWV

6 3

Adjusted

RSHUDWLQJFDVKࢊRZ 256 370

1HWLQWHUHVWSDLG (31) (13)

,QFRPHWD[SDLG (73) (94)

Adjusted

IUHHFDVKࢊRZ 151 264

 $GMXVWHGH[FOXGHVWKHFDVKLPSDFWRIVXEVWDQWLDOUHRUJDQLVDWLRQFRVWVDQGDFTXLVLWLRQUHODWHGLWHPV

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 26

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Financial review FRQWLQXHG

DW0DUFK$VDUHVXOWFDVKJHQHUDWHGIURP

RSHUDWLRQVZDVePLOOLRQePLOOLRQ

ZLWKDSHUFHQWDJHSRLQWIDOOLQDGMXVWHG

RSHUDWLQJFDVKࢊRZFRQYHUVLRQWR

1HWFDSLWDOH[SHQGLWXUHLQFUHDVHGIURPePLOOLRQ

WRePLOOLRQDVZHFRQWLQXHGWRLQYHVWLQ

RSWLPLVLQJRXUGLVWULEXWLRQVLWHVLPSOHPHQWLQJ

QHZSURGXFWPDQDJHPHQWV\VWHPVDXJPHQWLQJ

GLJLWDOFRPPHUFHFDSDELOLWLHVDQGVWUHQJWKHQLQJ

RXUWHFKQRORJ\SODWIRUPV

&DSLWDOH[SHQGLWXUHUHPDLQHGDWWLPHV

GHSUHFLDWLRQLQOLQHZLWKRXUW\SLFDOPDLQWHQDQFH

FDSLWDOH[SHQGLWXUHOHYHOVRIȁWLPHV

GHSUHFLDWLRQ:HDQWLFLSDWHFDSLWDOH[SHQGLWXUH

LQWREHFePLOOLRQLQFOXGLQJSODQQHG

VSHQGWRGHOLYHURXU(6*DFWLRQSODQVXFK

DVFRQWLQXLQJWRGHFDUERQLVHRXUUHJLRQDO'&LQ

%HDXYDLV)UDQFHDQGVWDUWLQJDW%DG+HUVIHOG

*HUPDQ\DQG)RUW:RUWK86:HDQWLFLSDWHD

IXUWKHUFePLOOLRQRIGHSUHFLDWLRQFKDUJHVLQ

UHODWLQJWRWKHFDSLWDOH[SHQGLWXUHRQRXU

SURGXFWDQGGHOLYHU\LQIRUPDWLRQV\VWHPV

1HWLQWHUHVWSDLGLQFUHDVHGE\ePLOOLRQWR

ePLOOLRQGXHWRLQFUHDVHGQHWGHEWUHVXOWLQJ

IURPWKHDFTXLVLWLRQVRI'LVWUHOHFDQG5LVRXO

DQGKLJKHULQWHUHVWUDWHV

,QFRPHWD[SDLGIHOOWRePLOOLRQUHࢊHFWLQJ

ORZHUWD[DEOHSURࢉWWLPLQJGLࢆHUHQFHVDQG

XWLOLVDWLRQRIORVVHV

$GMXVWHGIUHHFDVKࢊRZIHOOWRePLOOLRQIROORZLQJ

WKHGHFUHDVHLQRSHUDWLQJSURࢉWDQGWKHXQZLQGRI

HOHYDWHGSD\DEOHVIURP0DUFKDVDFRQVHTXHQFH

RIODUJHLQYHQWRU\RUGHUVGXULQJ

Working capital

7UDGHDQGRWKHUUHFHLYDEOHVKDYHLQFUHDVHGE\

ePLOOLRQWRePLOOLRQZLWKWKHDFTXLVLWLRQRI

'LVWUHOHFLQFUHDVLQJUHFHLYDEOHVE\ePLOOLRQ$V

WKHIDOOLQUHYHQXHLVSDUWO\UHODWHGWRWKHUHGXFWLRQ

LQRQHRࢆORZYDOXHFXVWRPHUVLWKDVDVPDOOHU

HࢆHFWRQUHFHLYDEOHVDVWKHVHFXVWRPHUVW\SLFDOO\

WUDQVDFWXVLQJFUHGLWVFDUGVRUZLWKVKRUWHU

SD\PHQWWHUPV

*URVVLQYHQWRULHVZHUHePLOOLRQDQLQFUHDVH

RIePLOOLRQZLWKWKHDFTXLVLWLRQRI'LVWUHOHF

DFFRXQWLQJIRUePLOOLRQDQGWKHUHPDLQGHU

LQFRQWLQHQWDO(XURSHDVZHFRQWLQXHWRDGG

LQYHQWRU\LQWRRXUH[WHQGHGUHJLRQDO'&LQ

%DG+HUVIHOG*HUPDQ\2XULQYHQWRU\OHYHOV

LQFUHDVHGLQWKHࢉUVWKDOIGXHWRWKHHDVLQJRI

JOREDOVXSSO\FKDLQLVVXHVUHVXOWLQJLQWKH

LPSURYHPHQWLQSHUIRUPDQFHRIVXSSOLHUVIXOࢉOOLQJ

QHZRUGHUVDQGWKHUHFHLSWRILQYHQWRU\SUHYLRXVO\

RQORQJOHDGWLPHV$VH[SHFWHGWKLVXQZRXQG

LQWKHVHFRQGKDOIGXHWRRXUDFWLRQVWRUHGXFH

LQYHQWRU\OHYHOVLQUHVSRQVHWRGHFOLQLQJYROXPHV

DQGDVDUHVXOWRXULQYHQWRU\WXUQZDVࢊDWDW

WLPHV\HDURQ\HDU,QYHQWRU\SURYLVLRQVKDYH

LQFUHDVHGE\ePLOOLRQWRePLOOLRQGXHWR

WKHFRQWLQXHGVDOHVVORZGRZQSXVKLQJLQYHQWRU\

LQWRH[FHVVSDUWLFXODUO\RIHOHFWURQLFVSURGXFWV

ZKHUHPLQLPXPRUGHUTXDQWLWLHVDUHKLJKDQG

VLQJOHERDUGFRPSXWLQJSURGXFWVZKLFK

DUHVORZPRYLQJ

2YHUDOOWUDGHDQGRWKHUSD\DEOHVGHFUHDVHGWR

ePLOOLRQIURPePLOOLRQZLWKWKHDFTXLVLWLRQ

RI'LVWUHOHFLQFUHDVLQJSD\DEOHVE\ePLOOLRQ

7KHRYHUDOOUHGXFWLRQUHࢊHFWVWKHWLPLQJRI

SD\PHQWVIRULQYHQWRULHVZLWKKLJKEDODQFHV

RXWVWDQGLQJDW0DUFKUHODWLQJWRȆV

LQFUHDVHLQLQYHQWRU\SOXVWKHVORZGRZQLQWKH

EXVLQHVVWKLV\HDUUHGXFLQJDFFUXDOVLQFOXGLQJ

WKRVHIRUDQQXDOLQFHQWLYHV

Net debt

2XUQHWGHEWKDVLQFUHDVHGWRePLOOLRQIURP

ePLOOLRQZLWKWKHDFTXLVLWLRQRI'LVWUHOHF

LQFUHDVLQJQHWGHEWE\ePLOOLRQ

7KHDFTXLVLWLRQZDVLQSDUWIXQGHGE\DQHZ

WKUHH\HDUWHUPORDQRIțPLOOLRQDQGGUDZLQJ

GRZQSDUWRIRXUePLOOLRQ6//IDFLOLW\7KH6//

WHUPORDQDQGWKHSULYDWHSODFHPHQWORDQQRWHV

IRUPRXUFRPPLWWHGGHEWIDFLOLWLHVRIePLOOLRQ

RIZKLFKePLOOLRQZDVXQGUDZQDWWKH\HDUHQG

,Q2FWREHURXUUHTXHVWWRWDNHXSRQHRIWKH

RQH\HDUWHUPH[WHQVLRQVWRWKH6//ZDVDSSURYHG

E\WKHOHQGHUVDQGVRWKLVIDFLOLW\QRZPDWXUHVLQ

2FWREHUZLWKDIXUWKHURQH\HDUH[WHQVLRQ

RSWLRQDQGDOHQGHURSWLRQDFFRUGLRQRIXSWRD

IXUWKHUePLOOLRQUHPDLQLQJ

6XPPDU\EDODQFHVKHHW

31 March 2024 31 March 2023

£m Assets Liabilities Net assets Assets Liabilities Net assets

,QWDQJLEOHDVVHWV 983 – 983 705 ȁ 705

3URSHUW\SODQWDQGHTXLSPHQW 181 – 181 186 ȁ 186

5LJKWRIXVHDVVHWV 73 – 73 47 ȁ 47

,QYHVWPHQWLQMRLQWYHQWXUH 1 – 1 2 ȁ 2

2WKHUQRQFXUUHQWDVVHWVDQG

OLDELOLWLHV 18 (125) (107) 13 (104) (91)

&XUUHQWDVVHWVDQGOLDELOLWLHV 1,383 (637) 746 1,330 (685) 646

&DSLWDOHPSOR\HG 2,638 (761) 1,877 2,283 (789) 1,494

5HWLUHPHQWEHQHࢉWQHWDVVHWV

REOLJDWLRQV 2 (27) (26) 1(37)(36)

1HWFDVKGHEWLQFOXGLQJ

OHDVHOLDELOLWLHV 259 (677) (418) 260 (373) (113)

$VVHWVOLDELOLWLHV 2,898 (1,466) 1,433 2,544 (1,199) 1,345

1HWGHEWDQDO\VLV

£m 2024 2023

1RQFXUUHQWERUURZLQJV (440) (185)

%DQNRYHUGUDIWV (163) (140)

/HDVHOLDELOLWLHV (74) (49)

*URVVERUURZLQJV (677) (373)

&DVKDQGVKRUWWHUPGHSRVLWV 259 260

Net debt (418) (113)

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 27

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Financial review FRQWLQXHG

7KH*URXSȆVࢉQDQFLDOPHWULFVUHPDLQVWURQJZLWK

QHWGHEWWRDGMXVWHG(%,7'$RI[DQG(%,7$WR

LQWHUHVWRI[OHDYLQJVLJQLࢉFDQWKHDGURRP

IRU WKH*URXSȆVEDQNLQJFRYHQDQWVRIQHWGHEWWR

DGMXVWHG(%,7'$OHVVWKDQWLPHVDQG(%,7$

WR LQWHUHVWJUHDWHUWKDQWLPHV

(418)

(113)

23/24

net debt

22/23

net debt

(333)

Acquisitions

(104)

Dividends

151

Adjusted

free cash

flow

(6)

Cash

impact of

adjusted

items

(14)

Net new

leases

and

employee

Movement in net debt

£m

ROCE

52&(LVWKHDGMXVWHGRSHUDWLQJSURࢉWIRUWKH

 PRQWKVHQGHG0DUFKH[SUHVVHGDV

D SHUFHQWDJHRIWKHPRQWKO\DYHUDJHFDSLWDO

HPSOR\HGQHWDVVHWVH[FOXGLQJQHWGHEWDQG

UHWLUHPHQWEHQHࢉWREOLJDWLRQV52&(ZDV

FRPSDUHGWRODVW\HDUGXHWRWKHLPSDFWRI

DFTXLVLWLRQVSHUFHQWDJHSRLQWVDQGWKHGHFOLQH

LQDGMXVWHGRSHUDWLQJSURࢉW SHUFHQWDJH

SRLQWVSDUWO\RࢆVHWE\D GHFUHDVHLQPRQWKO\

DYHUDJHFDSLWDOHPSOR\HG SHUFHQWDJHSRLQWV

5HWLUHPHQWEHQHࢉWREOLJDWLRQV

5HWLUHPHQWEHQHࢉWQHWREOLJDWLRQVRIWKH*URXSȆV

GHࢉQHGEHQHࢉWVFKHPHVZHUHePLOOLRQ

FRPSDUHGWRePLOOLRQDW0DUFK7KH8.

GHࢉQHGEHQHࢉWVFKHPHRXUODUJHVWVFKHPHKDG

D QHWREOLJDWLRQRIePLOOLRQXQGHU,QWHUQDWLRQDO

$FFRXQWLQJ6WDQGDUGȅ(PSOR\HH%HQHࢉWVȆEHLQJ

WKHSUHVHQWYDOXHRIWKHDJUHHGIXWXUHGHࢉFLW

FRQWULEXWLRQVDJUHHGIROORZLQJWKH0DUFK

WULHQQLDOIXQGLQJYDOXDWLRQDQGSD\DEOHWR

6HSWHPEHU

5HWLUHPHQWEHQHࢉWREOLJDWLRQV

31 March 2024 31 March 2023

£m UK Other Total UK Other Total

)DLUYDOXHRIVFKHPHDVVHWV 421 31 452 425 7 432

'HࢉQHGEHQHࢉWREOLJDWLRQV (385) (26) (411) (391) (6) (396)

(ࢆHFWRIDVVHWFHLOLQJRQHURXV OLDELOLW\ (52) (4) (56) (61) ȁ (61)

6WDWXVRIIXQGHGVFKHPHV (16) 2 (15) (26) 1 (25)

8QIXQGHGVFKHPHV – (11) (11) ȁ (11) (11)

7RWDOQHWREOLJDWLRQV (16) (10) (26) (26) (10) (36)

>45%

of the site’s electricity is

generated by solar panels

SOLAR PANELS

FOR SOUTH

AFRICA

7KHN:FDSDFLW\VRODUSDQHODUUD\DQGN:KEDWWHU\

LQVWDOOHGDWRXURࢇFHVDQG)&LQ0LGUDQG6RXWK$IULFD

KDYHVXSSOLHGRYHURIWKHVLWHȆVHOHFWULFLW\XVHVLQFH

WKH\ZHUHFRPPLVVLRQHGLQ2FWREHU

3UHYLRXVO\SRZHUFXWVLQ6RXWK$IULFDPHDQWWKDWWKHVLWH

UHOLHGRQLWVGLHVHOJHQHUDWRUIRUXSWRKRXUVDGD\

FRPSDUHGWROHVVWKDQVL[KRXUVSHUPRQWKQRZWKH

V\VWHPLVRSHUDWLRQDO

2QVLWHVRODUSRZHUJHQHUDWLRQKDVFXWHQHUJ\FRVWVE\

DURXQGUHGXFHGFDUERQHPLVVLRQVDQGKDVSURYLGHG

PXFKQHHGHGHQHUJ\VHFXULW\IRU566RXWK$IULFD

ESG IN ACTION

Dividend

7KH%RDUGLQWHQGVWRFRQWLQXHWRSXUVXHD

SURJUHVVLYHGLYLGHQGSROLF\ZKLOVWUHPDLQLQJ

FRPPLWWHGWRDKHDOWK\GLYLGHQGFRYHURYHUWLPHE\

GULYLQJLPSURYHGUHVXOWVDQGVWURQJHUFDVKࢊRZ

7KH%RDUGSURSRVHVWRPDLQWDLQWKHࢉQDOGLYLGHQG

DWSSHUVKDUH7KLVZLOOEHSDLGRQ-XO\

WRVKDUHKROGHUVRQWKHUHJLVWHURQ-XQH$V

DUHVXOWWKHWRWDOSURSRVHGGLYLGHQGIRU

ZLOOEHSSHUVKDUHUHSUHVHQWLQJDQLQFUHDVH

RI RYHUWKHIXOO\HDUGLYLGHQG$GMXVWHG

HDUQLQJVGLYLGHQGFRYHUIRULVWLPHV

Foreign exchange risk

7KH*URXSGRHVQRWKHGJHWUDQVODWLRQH[SRVXUH

RQWKHLQFRPHVWDWHPHQWVRIRYHUVHDVVXEVLGLDULHV

%DVHGRQWKHPL[RIQRQVWHUOLQJGHQRPLQDWHG

UHYHQXHDQGDGMXVWHGRSHUDWLQJSURࢉWDRQHFHQW

PRYHPHQWLQWKHHXURZRXOGLPSDFWDQQXDO

DGMXVWHGSURࢉWEHIRUHWD[E\ePLOOLRQDQGD

RQH FHQWPRYHPHQWLQWKH86GROODUZRXOGLPSDFW

DQQXDODGMXVWHGSURࢉWEHIRUHWD[E\ePLOOLRQ

7KH*URXSLVDOVRH[SRVHGWRIRUHLJQFXUUHQF\

WUDQVDFWLRQDOULVNEHFDXVHPRVWRSHUDWLQJ

FRPSDQLHVKDYHVRPHOHYHORISD\DEOHVLQ

FXUUHQFLHVRWKHUWKDQWKHLUIXQFWLRQDOFXUUHQF\

6RPHRSHUDWLQJFRPSDQLHVDOVRKDYHUHFHLYDEOHV

LQFXUUHQFLHVRWKHUWKDQWKHLUIXQFWLRQDOFXUUHQF\

2QWKHLUEHKDOI*URXS7UHDVXU\PDLQWDLQVWKUHH

WR VHYHQPRQWKVKHGJLQJDJDLQVWIUHHO\WUDGDEOH

FXUUHQFLHVWRVPRRWKWKHLPSDFWRIࢊXFWXDWLRQV

LQ FXUUHQF\)RU5LVRXOKHGJHVFDQH[WHQGRXWWR

 PRQWKVIRU86GROODUWUDGLQJSURMHFWLRQV7KH

*URXSȆVODUJHVWH[SRVXUHVUHODWHGWRHXURVDQG

86 GROODUV

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 28

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Highlights

74%

RIUHYHQXHIURPGLJLWDO

19%

RIUHYHQXHIURP56352

30%

RIUHYHQXHIURP

VHUYLFHVROXWLRQV

50.9

NPS

EMEA

PERFORMANCE

8.DQG,UHODQGZKLFKDFFRXQWVIRURIWKH

UHJLRQȆVUHYHQXHVDZDVPDOOUHYHQXHGHFOLQH

UHࢊHFWLQJPDUNHWZHDNQHVVDQGOHVVGHPDQGIURP

PLGVL]HGFXVWRPHUV)UDQFHVDZORZVLQJOHGLJLW

JURZWKGHOLYHULQJVROLGSHUIRUPDQFHLQRXU

LQGXVWULDOSURGXFWFDWHJRULHVHVSHFLDOO\ZKHUHZH

KDYHZRUNHGFORVHO\ZLWKRXUVXSSOLHUVRQVSHFLࢉF

SURPRWLRQV*HUPDQ\VXࢆHUHGIURPZHDN30,

GDWDDQGDKLJKH[SRVXUHWRHOHFWURQLFVSURGXFWV

OHDGLQJWRDGRXEOHGLJLWUHYHQXHGHFOLQH

'LJLWDOGHOLYHUHGJRRGJURZWKLQRXUH3URFXUHPHQW

DQGSXUFKDVLQJPDQDJHUVROXWLRQV7KHVH

VROXWLRQVDUHLQWHJUDWHGZLWKLQRXUFXVWRPHUVȆ

V\VWHPVSXOOLQJWKURXJKSURGXFWUHYHQXH

DQGJHQHUDWLQJFXVWRPHUOR\DOW\DQGUHFXUULQJ

UHYHQXH:HEUHYHQXHKDVEHHQLPSDFWHG

E\UHGXFHGGHPDQGIURPVPDOODQG

PHGLXPVL]HGFXVWRPHUV

2XUVHUYLFHVROXWLRQVZKLFKDUHDVVRFLDWHGZLWK

RI(0($ȆVUHYHQXHEHQHࢉWHGIURPJUHDWHU

SDUWLFLSDWLRQRIRXUGLJLWDOVROXWLRQVDVZHDFWLYHO\

PLJUDWHGKLJKHUYDOXHFXVWRPHUVIURPWKHZHE

56,QWHJUDWHG6XSSO\LQ(0($FRQWLQXHVWRZLQ

QHZFRQWUDFWVDQGKDVDVWURQJUHWHQWLRQUDWHIRU

H[LVWLQJFXVWRPHUVKRZHYHUWKHRSHUDWLRQDO

LQYHVWPHQWUHTXLUHGLQWKHHDUO\\HDUVRIFRQWUDFW

UROORXWFRQWLQXHGWRLPSDFWࢉQDQFLDOSHUIRUPDQFH

DQGGHSUHVVSURࢉWDELOLW\

56352LQFUHDVHGDVFXVWRPHUVUHVSRQGWRD

ORZHUSULFHSRLQWKLJKTXDOLW\DOWHUQDWLYHDQGDV

ZHUHEUDQGHGRXURZQEUDQG6DIHW\6ROXWLRQV

SURGXFWVWR56352:HODXQFKHG56352LQWR

WKH'LVWUHOHFHFRPPHUFHSODWIRUPVDQGVDZHDUO\

VXFFHVVHVSHFLDOO\LQPDUNHWVZKHUH'LVWUHOHFKDV

DKLJKHUSUHVHQFHWKDQ56VXFKDV6ZLW]HUODQG

5HYHQXHLQFUHDVHGLQFOXGLQJWKHDFTXLVLWLRQ

RI'LVWUHOHF/LNHIRUOLNHUHYHQXHGHFOLQHG

GXHWRWKHHOHFWURQLFVGRZQF\FOHDQGORZOHYHOV

RILQGXVWULDOSURGXFWLRQDFURVVWKHUHJLRQ

30,VKDYHEHHQEHORZZKLFKUHSUHVHQWV

DFRQWUDFWLRQLQDOOPDMRUFRXQWULHVWKURXJKRXW

WKH\HDU5HYHQXHGHFOLQHZDVFRQFHQWUDWHG

LQ*HUPDQ\JLYHQLWVHOHFWURQLFH[SRVXUH

:HHVWLPDWHWKHSRVWSDQGHPLFWUDGLQJWDLOZLQGV

FRQWULEXWHGFePLOOLRQRIUHYHQXHLQ(0($

GXULQJZKLFKDVLWXQZRXQGUHGXFHG

RXUOLNHIRUOLNHUHYHQXHE\FGXULQJ

2XULQGXVWULDOSURGXFWUDQJHVSHUIRUPHGZHOOZLWK

OLNHIRUOLNHJURZWKHVSHFLDOO\ZLWKLQPDLQWHQDQFH

PHFKDQLFDODQGࢊXLGSRZHUDQGVDIHW\DQG

SURWHFWLRQDVZHFRQWLQXHWRIRFXVRXUVDOHVDQG

PDUNHWLQJHࢆRUWVRQFRUHLQGXVWULDOFDWHJRULHV

'HPDQGIRUHOHFWURQLFVUHGXFHGDWDWLPHZKHQ

WKHUHZDVH[FHVVLYHLQYHQWRU\DQGLQGXVWU\

GHVWRFNLQJ7KH$&LQGXVWULDOFDWHJRU\LVDOVR

FORVHO\FRUUHODWHGWRWKHHOHFWURQLFVF\FOHDQG

ZKLOVWJURZWKZDVQHJDWLYHZHRXWSHUIRUPHG

WKHHOHFWURQLFVPDUNHW

:HKDYHIRFXVHGRXUPDUNHWLQJHࢆRUWVRQKLJK

OLIHWLPHYDOXHFXVWRPHUVDQGKDYHVHHQVWURQJ

SHUIRUPDQFHIURPRXUFRUSRUDWHDFFRXQWV

ZKHUHUHYHQXHJUHZDVWKDWPDUNHWVHJPHQW

FRQVROLGDWHGWKHLUGLVWULEXWLRQSDUWQHUVDFURVV

PXOWLSOHFDWHJRULHV$GGLWLRQDOO\ZHDUHLPSURYLQJ

WKHSURࢉWDELOLW\RIVPDOOYDOXHWUDQVDFWLRQVE\

DSSO\LQJDSSURSULDWHKDQGOLQJFKDUJHV7KHUHKDV

EHHQDGHFUHDVHLQVPDOOWUDQVLWRU\FXVWRPHUV

JDLQHGGXULQJVXSSO\VKRUWDJHVDQGDUHQRWRXU

WDUJHWFXVWRPHUVZKRKDYHQRZUHYHUWHGWRWKHLU

QRUPDOGLVWULEXWLRQFKDQQHOV

of Group

revenue

61%

of total segment

operating profit

71%

Regional review

Overall results

2024 2023 Change

Like-for-like

change

Revenue £1,795m £1,769m 1% (5)%

2SHUDWLQJSURࢉW

£256m £276m (7)% (9)%

2SHUDWLQJSURࢉW

margin 14.2% 15.6% SWV SWV

'LJLWDOUHYHQXH

£1,322m £1,311m 1% (3)%

RS PRO revenue

£346m £338m 2% 3%

6HUYLFHVROXWLRQV

revenue

£532m £506m 5% 5%

 /LNHIRUOLNHDGMXVWHGIRUFXUUHQF\DQGWRH[FOXGHWKHLPSDFWRI

DFTXLVLWLRQVUHYHQXHDOVRDGMXVWHGIRUWUDGLQJGD\V

 6HH1RWHRQSDJHVDQGIRUUHFRQFLOLDWLRQVWR*URXS

RSHUDWLQJSURࢉW

 6HH1RWHRQSDJHVDQGIRUGLVDJJUHJDWLRQRIUHYHQXH

DQDO\VLVDQGUHFRQFLOLDWLRQVWRUHJLRQȆVUHYHQXH

'LVWUHOHFFRQWULEXWHGePLOOLRQWRUHYHQXH

DQGePLOOLRQWR(0($ȆVRSHUDWLQJSURࢉWVLQFHLWV

DFTXLVLWLRQRQ-XQH7UDGLQJLQ'LVWUHOHF

KDVEHHQVLPLODUO\LPSDFWHGE\PDUNHWFRQGLWLRQV

QRWDEO\LQLWVHOHFWURQLFVH[SRVXUHLQ*HUPDQ\DQG

HDVWHUQ(XURSH+RZHYHULQWHJUDWLRQSODQVKDYH

EHHQDFFHOHUDWHGZKLFKFRPELQHGZLWKIXUWKHU

FRVWVDYLQJVLGHQWLࢉHGZLOOGHOLYHUUHWXUQVWKDW

ZLOOFRYHUWKH*URXSȆVFRVWRIFDSLWDOZLWKLQ

WKUHH\HDUV

(0($ȆVOLNHIRUOLNHJURVVPDUJLQZDVࢊDWGXHWR

GLVFLSOLQHGFRQWURORIGLVFRXQWVDQGVRPHEX\LQJ

HࢇFLHQFLHVRࢆVHWWLQJWKHXQZLQGLQJRIWKH

SRVWSDQGHPLFWUDGLQJEHQHࢉWVFSHUFHQWDJH

SRLQWVLPSDFW

2SHUDWLQJFRVWVIHOOE\OLNHIRUOLNH&RVW

PHDVXUHVZHUHRࢆVHWE\LQࢊDWLRQDU\SUHVVXUHV

UHGXQGDQF\FKDUJHVUHODWLQJWRRXUFRVWDFWLRQ

SURJUDPPHLQFOXGLQJWKHFORVXUHRIWKH)&LQ

1HZSRUW8.DQGLQLWLDOVWHSVLQWHJUDWLQJ'LVWUHOHF

DQGLPSDLUPHQWVRQVRPHVRIWZDUHDQG

WHFKQRORJ\SURGXFWV(0($ȆVRSHUDWLQJSURࢉW

PDUJLQIHOOE\SHUFHQWDJHSRLQWVOLNHIRUOLNHWR

:HHVWLPDWHFePLOOLRQRIRSHUDWLQJ

SURࢉWDVVRFLDWHGZLWKWKHSRVWSDQGHPLFWUDGLQJ

EHQHࢉWGLGQRWUHSHDWLQ

(0($ȆVUROOLQJPRQWK136ZDVXSIURP

LQ:HFRQWLQXHGWRLPSURYH

LQYHQWRU\DYDLODELOLW\DVOHDGWLPHVUHGXFHGZKLOH

LQYHQWRU\LQYHVWPHQWVLQRXUH[SDQGHGUHJLRQDO

'&LQ*HUPDQ\DQGRXUQHZ)&LQ6SDLQKDYHDOVR

LPSURYHGVHUYLFHOHYHOVWRFXVWRPHUV

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 29

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Overall results

2024 2023 Change

Like-for-like

change

Revenue £934m £946m (1)% (13)%

2SHUDWLQJSURࢉW

£101m £149m (32)% (37)%

2SHUDWLQJSURࢉW

margin 10.9% 15.7% SWV SWV

'LJLWDOUHYHQXH

£336m £405m (17)% (13)%

RS PRO revenue

£7m £7m (6)% (2)%

6HUYLFHVROXWLRQV

revenue

£133m £133m 0% (2)%

 /LNHIRUOLNHDGMXVWHGIRUFXUUHQF\DQGWRH[FOXGHWKHLPSDFWRI

DFTXLVLWLRQVUHYHQXHDOVRDGMXVWHGIRUWUDGLQJGD\V

 6HH1RWHRQSDJHVDQGIRUUHFRQFLOLDWLRQVWR*URXS

RSHUDWLQJSURࢉW

 6HH1RWHRQSDJHVDQGIRUGLVDJJUHJDWLRQRIUHYHQXH

DQDO\VLVDQGUHFRQFLOLDWLRQVWRUHJLRQȆVUHYHQXH

Highlights

36%

RIUHYHQXHIURPGLJLWDO

RIUHYHQXHIURP56352

14%

RIUHYHQXHIURP

VHUYLFHVROXWLRQV

64.8

NPS

Regional review FRQWLQXHG

AMERICAS

PERFORMANCE

56,QWHJUDWHG6XSSO\LQ$PHULFDVKDVXQGHUJRQH

VHYHUDOFKDQJHVDVZHSODFHGPRUHIRFXVRQ

KLJKHUOLIHWLPHYDOXHFXVWRPHUVDQGSXWLQSODFH

SURFHVVHVWKDWZLOODOORZWKHEXVLQHVVWRVFDOHPRUH

TXLFNO\DQGHࢇFLHQWO\:HKDYHVLJQHGVHYHUDOQHZ

FRQWUDFWVZLWKPXOWLQDWLRQDOFXVWRPHUVDQGDUH

IRFXVLQJRQGULYLQJFURVVVHOOLQJRSSRUWXQLWLHV

ZLWK563522XURWKHUVHUYLFHVROXWLRQVZHUH

LPSDFWHGE\ORZHUSURFXUHPHQWVROXWLRQ

WUDQVDFWLRQVLQWKHGHFOLQLQJPDUNHW

56352VWLOODFFRXQWVIRURQO\RIWKH

UHJLRQȆVUHYHQXHDQGLVDNH\IRFXVIRURXUVDOHV

DQGOHDGHUVKLSWHDPV:HH[SHFWLPSURYHG

UHYHQXHSDUWLFLSDWLRQIURPRXUUHEUDQGLQJ

56LQ$PHULFDVKDYLQJSUHYLRXVO\WUDGHGXQGHU

WKH$OOLHGQDPHDQGWDLORULQJRXUSURGXFWRࢆHULQJ

WREHPRUHDSSURSULDWHIRURXUFXVWRPHUVLQ

WKHUHJLRQ:HH[SHFWSDUWLFLSDWLRQDVD

SHUFHQWDJHRIWKHUHJLRQȆVUHYHQXHWRLQFUHDVHDV

ZHVWDUWRࢆHULQJ56352SURGXFWVLQ5LVRXO

5LVRXOKDGDVWURQJ\HDURIJURZWKSDUWLDOO\RࢆVHW

E\IRUHLJQH[FKDQJHPRYHPHQWVRQDQ

DSSUHFLDWLQJ0H[LFDQSHVR:HODXQFKHGD

WUDQVDFWLRQDOZHEVLWHLQ)HEUXDU\WRVXSSRUW

WKHIXWXUHH[SDQVLRQRIWKHEXVLQHVVDQGDUH

LQWURGXFLQJDEURDGHUSURGXFWUDQJHDQG

HQKDQFHGSURFXUHPHQWVROXWLRQV

$PHULFDVȆJURVVPDUJLQIHOOE\SHUFHQWDJH

SRLQWVRQDOLNHIRUOLNHEDVLVDVWKHSRVWSDQGHPLF

WUDGLQJWDLOZLQGVXQZRXQGDFFRXQWLQJIRU

FSHUFHQWDJHSRLQWVDQGVRPHLQFUHDVHGSULFH

FRPSHWLWLRQIURPWKHZLGHUDYDLODELOLW\RISURGXFWV

LQWKHPDUNHW

5HYHQXHGHFOLQHGZLWKOLNHIRUOLNHUHYHQXH

GRZQH[FOXGLQJ5LVRXOH[FKDQJHUDWH

PRYHPHQWVDQGWKHLPSDFWRIWUDGLQJGD\V7KLV

SHUIRUPDQFHUHࢊHFWVWKHFKDQJHLQWKHHOHFWURQLFV

F\FOHDQGWKHYHU\VWURQJFRPSDUDWLYHVLQWKHSULRU

SHULRGZKHUHZHEHQHࢉWHGIURPVWURQJLQYHQWRU\

DYDLODELOLW\7KLVZDVHQDEOHGE\WKHH[SDQVLRQ

RIRXUUHJLRQDO'&LQ)RUW:RUWK86FRPSOHWHG

GXULQJ:HHVWLPDWHWKHSRVWSDQGHPLF

WUDGLQJEHQHࢉWFRQWULEXWHGFePLOOLRQRI

UHYHQXHLQ$PHULFDVGXULQJZKLFKDV

LWXQZRXQGUHGXFHGRXUOLNHIRUOLNHUHYHQXHE\

FGXULQJ

2XUSHUIRUPDQFHUHࢊHFWHGWKHVRIWHFRQRPLF

EDFNGURS30,GDWDDQGFKDQJHLQWKHHOHFWURQLFV

F\FOH2XUEXVLQHVVKDVDVWURQJFRUUHODWLRQWR

WKHEXLOGF\FOHVLQWKHHOHFWURQLFVPDUNHWJLYHQ

WKHDGGLWLRQDOKLJKH[SRVXUHWR$&LQGXVWULDO

SURGXFWVRIWKHUHJLRQȆVUHYHQXHYHUVXV

DFURVVWKH*URXSDQGVRZDVLPSDFWHGE\WKH

GHFUHDVHLQGHPDQGDQGRYHUVXSSO\ZLWKLQWKH

HOHFWURQLFVLQGXVWU\PRUHDFXWHO\$GGLWLRQDOO\RXU

FXVWRPHUVSHQGLQ$PHULFDVKDVDJUHDWHU

SURSRUWLRQRIGLUHFWPDWHULDODQGSURMHFWUHODWHG

H[SHQGLWXUHZLWKOHVVRID052GHPDQGWKDQWKH

UHVWRIWKH*URXSDQGWKHUHIRUHZDVPRUHDࢆHFWHG

E\FXVWRPHUVUHGXFLQJGHPDQGDQGGHVWRFNLQJ

5HYHQXHIURPGLJLWDOGHFOLQHGE\OLNHIRUOLNH

LQOLQHZLWKWKHUHJLRQȆVSHUIRUPDQFH2XUUHEUDQGLQJ

LQ)HEUXDU\LPSDFWHGRXUVHDUFKHQJLQH

RSWLPLVDWLRQ6(2DQGVPDOOHUWUDQVDFWLRQDO

FXVWRPHUDFFRXQWVZKRKDYHOHVVLQWHUDFWLRQV

ZLWKRXUVDOHVWHDP$GGLWLRQDOO\WKHODFNRI

GLJLWDOVDOHVLQ5LVRXOGLOXWHGWKHUHJLRQȆVGLJLWDO

UHYHQXHSDUWLFLSDWLRQ

of total segment

operating profit

28%

of Group

revenue

32%

2SHUDWLQJSURࢉWDQGRSHUDWLQJSURࢉWPDUJLQ

GHFOLQHGGXHWRUHGXFHGUHYHQXHDQGWKH

UHVXOWLQJJURVVSURࢉWGHFOLQH:HUHGXFHGRXU

RSHUDWLQJFRVWVE\OLNHIRUOLNHUHࢊHFWLQJWKH

UHVWUXFWXULQJRIRXUWHDPVLQWKHࢉUVWKDOIRIWKH

\HDUDQGUHGXFHGGLVFUHWLRQDU\FRVWV:HFRQWLQXH

WRLQYHVWLQLQLWLDWLYHVIRFXVHGRQFXVWRPHU

JURZWKGLJLWDODQGRXUVHUYLFHVROXWLRQVRࢆHULQJ

:HHVWLPDWHFePLOOLRQRIRSHUDWLQJSURࢉW

DVVRFLDWHGZLWKWKHSRVWSDQGHPLFWUDGLQJEHQHࢉW

GLGQRWUHSHDWLQ

$PHULFDVȆUROOLQJWZHOYHPRQWK136ZDV

GRZQIURPLQEXWVWLOOWKHKLJKHVWLQ

RXU*URXS7KLVLVDVWURQJSHUIRUPDQFHJLYHQ

FRPSHWLWLYHSULFLQJSUHVVXUHODJHࢆHFWRIWKH

UHEUDQGDQGWHPSRUDU\LPSDFWRIGLVUXSWHG

UHODWLRQVKLSVIURPWKHUHVWUXFWXULQJRIVDOHVWHDPV

WREHWWHUVHUYHRXUEURDGFXVWRPHUEDVH2XU

IRFXVUHPDLQVRQGHOLYHULQJDVWURQJFXVWRPHU

H[SHULHQFHWKURXJKWLPHO\UHVSRQVHDQG

FRQVLVWHQWVHUYLFH

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 30

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Regional review FRQWLQXHG

ZDUHKRXVLQJDQGORFDOVXSSRUWLQDPDMRUUHVRXUFH

KXELQ$VLD3DFLࢉF

6RXWK(DVW$VLDZKLFKFRQWULEXWHVRIWKH

UHJLRQȆVUHYHQXHVDZDKLJKVLQJOHGLJLWOLNHIRUOLNH

GHFOLQHLQUHYHQXHPDLQO\GXHWRHOHFWURQLFV

ZHDNQHVV2XUVWUDWHJLFLQYHVWPHQWVLQORFDO

LQYHQWRU\FDSDFLW\LQFOXGLQJDQXSJUDGHWRRXU)&

LQ7KDLODQGDQGOHDVLQJQHZ)&VLQ0DOD\VLD

3KLOLSSLQHVDQG1HZ=HDODQGLPSURYHGOHDGWLPHV

DQGVXSSRUWHGVHFRQGKDOIUHFRYHU\

'LJLWDOOLNHIRUOLNHUHYHQXHSHUIRUPDQFHUHࢊHFWHG

ZHDNHUPDUNHWGHPDQG,QWKHVHFRQGKDOIZHVDZ

DVXEVWDQWLDOLPSURYHPHQWLQERWKSDLGDQG6(2

SHUIRUPDQFH7KLVZDVGULYHQE\EHWWHUDOLJQPHQW

RIRXUPDUNHWLQJWRIRFXVRQORFDOO\VWRFNHG

SURGXFWVDQGDQHZWHDPLPSURYLQJRXUFRQWHQW

DQGYDOXHDGGIXQFWLRQDOLW\:HDOVRODXQFKHG

VHYHUDOORFDOGLJLWDOLQLWLDWLYHVLQWKHVHFRQGKDOI

LQFOXGLQJVHDUFKHQJLQHHQKDQFHPHQWV

56352OLNHIRUOLNHUHYHQXHGHFOLQHRXWSHUIRUPHG

WKHUHJLRQSHUIRUPDQFHVXSSRUWHGE\DQ

HQKDQFHGJRWRPDUNHWVWUDWHJ\LQFOXGLQJ

WDUJHWHGSURGXFWPDUNHWLQJFDPSDLJQVDQG

FRPSHWLWLYHSULFLQJ

2XUJURVVPDUJLQGHFUHDVHGRQDOLNHIRUOLNHEDVLV

E\SHUFHQWDJHSRLQWVDOPRVWKDOIRIZKLFKZDV

WKHXQZLQGRISULFHLQࢊDWLRQEHQHࢉWVUHODWHGWR

SRVWSDQGHPLFWUDGLQJ$GGLWLRQDOO\ZHVDZ

KHLJKWHQHGFRPSHWLWLYHSULFLQJDVVXSSO\FKDLQ

FRQVWUDLQWVHDVHGRUGHUERRNVXQZRXQGDQG

H[FHVVLQYHQWRU\ZDVDYDLODEOHLQWKHPDUNHW

$VLD3DFLࢉFȆVUHYHQXHGHFOLQHGE\LQFOXGLQJ

FXUUHQF\PRYHPHQWV/LNHIRUOLNHUHYHQXH

GHFUHDVHGE\UHࢊHFWLQJDVLJQLࢉFDQWPDUNHW

VORZGRZQDQGVXEVHTXHQWFRQWUDFWLRQLQWKH

HOHFWURQLFVPDUNHWGHPDQGFRXSOHGZLWKWKH

HDVLQJRIVXSSO\FRQVWUDLQWV:HHVWLPDWHWKH

SRVWSDQGHPLFWUDGLQJWDLOZLQGVFRQWULEXWHG

FePLOOLRQRIUHYHQXHLQ$VLD3DFLࢉFGXULQJ

ZKLFKDVLWXQZRXQGUHGXFHGRXU

OLNHIRUOLNHUHYHQXHE\FGXULQJ

'HVSLWHWKHFKDOOHQJHVLQWKHUHJLRQZHEHOLHYH

WKDWZLWKWKHH[SDQVLRQRIFDSDELOLW\DQG

JHRJUDSKLFIRRWSULQWFDSDFLW\RYHUWKHODVW\HDU

56LQ$VLD3DFLࢉFZLOOJURZWREHDGLࢆHUHQWLDWHG

DQGPDUNHWOHDGLQJVROXWLRQEDVHGGLVWULEXWRULQ

WKHFRPLQJ\HDUV:HKDYHEXLOWDQH[WHQVLYH

JHRJUDSKLFRSHUDWLRQDOIRRWSULQWWKDWVHSDUDWHV

XVIURPRXUFRPSHWLWRUVZLWKLQWKHUHJLRQ

-DSDQJHQHUDWHVRYHURILWVUHYHQXHIURP

HOHFWURQLFVDQGLWVFXVWRPHUVDUHODUJHO\HOHFWURQLFV

IRFXVHG*UHDWHU&KLQDUHSUHVHQWLQJRI

WKHUHJLRQȆVUHYHQXHIDFHGXQLTXHO\FKDOOHQJLQJ

WUDGLQJFRQGLWLRQVGXHWRUHGXFHGH[WHUQDO

LQYHVWPHQWDVWUDGHVKLIWHGRXWVLGH&KLQDȆV

ERUGHUVDQGWUDGLQJVDQFWLRQVUHGXFHG

RXUFXVWRPHUEDVH

$XVWUDOLDDQG1HZ=HDODQGZKLFKDFFRXQWVIRU

RIWKHUHJLRQȆVUHYHQXHPDLQWDLQHGORZVLQJOH

GLJLWOLNHIRUOLNHUHYHQXHJURZWKZLWKWDUJHWHG

PDUNHWLQJWRODUJHFRUSRUDWHFXVWRPHUVRࢆVHWWLQJ

WKHPDUNHWGHFOLQH:HVDZUREXVWWUDGLQJIURP

ODUJHLQGXVWULDOFXVWRPHUVDQGKDYHDORZHU

H[SRVXUHWRHOHFWURQLFVFXVWRPHUV6LQFHWKH\HDU

HQGZHKDYHFRPSOHWHGDVPDOODFTXLVLWLRQ7ULGHQW

LQ3HUWK$XVWUDOLDWKDWH[SDQGVRXUVHUYLFH

ASIA PACIFIC

PERFORMANCE

of total segment

operating profit

of Group

revenue

Overall results

2024 2023 Change

Like-for-like

change

Revenue £214m £268m (20)% (15)%

2SHUDWLQJSURࢉW

£4m £38m (90)% (89)%

2SHUDWLQJSURࢉW

margin 1.8% 14.3% SWV SWV

'LJLWDOUHYHQXH

£123m £161m (23)% (17)%

RS PRO revenue

£33m £37m (11)% (4)%

6HUYLFHVROXWLRQV

revenue

£43m £46m (6)% 0%

 /LNHIRUOLNHDGMXVWHGIRUFXUUHQF\DQGWRH[FOXGHWKHLPSDFWRI

DFTXLVLWLRQVUHYHQXHDOVRDGMXVWHGIRUWUDGLQJGD\V

 6HH1RWHRQSDJHVDQGIRUUHFRQFLOLDWLRQVWR*URXS

RSHUDWLQJSURࢉW

 6HH1RWHRQSDJHVDQGIRUGLVDJJUHJDWLRQRIUHYHQXH

DQDO\VLVDQGUHFRQFLOLDWLRQVWRUHJLRQȆVUHYHQXH

Highlights

58%

RIUHYHQXHIURPGLJLWDO

16%

RIUHYHQXHIURP56352

20%

RIUHYHQXHIURP

VHUYLFHVROXWLRQV

21.8

NPS

2XURSHUDWLQJSURࢉWPDUJLQGHFOLQHUHࢊHFWHGWKH

QHJDWLYHRSHUDWLRQDOJHDULQJLPSDFWRIWKHORZHU

YROXPHVDQGJURVVPDUJLQRQRXUFRVWEDVH:H

DGMXVWHGRXUFRVWEDVHZKLFKGHOLYHUHGVRPH

ࢉQDQFLDOEHQHࢉWVLQWKHVHFRQGKDOI2YHUWKHIXOO

\HDURXURSHUDWLQJFRVWVIHOOOLNHIRUOLNHE\

:HDUHIRFXVHGRQRSHUDWLQJDPRUHDSSURSULDWH

DQGࢊH[LEOHFRVWVWUXFWXUHLQWKHUHJLRQPRYLQJ

WRPRUHORFDOVRXUFLQJDQGLQFUHDVLQJRXUORFDO

IXOࢉOPHQWFDSDFLW\LQ6RXWK(DVW$VLDDQG1HZ

=HDODQGZKLFKLVLPSURYLQJRXUVSHHGWRPDUNHW

UHGXFLQJGHOLYHU\WLPHVDQGLPSURYLQJRXU

FXVWRPHUVHUYLFHVLJQLࢉFDQWO\:HHVWLPDWHWKDW

FePLOOLRQRIRSHUDWLQJSURࢉWDVVRFLDWHGZLWK

WKHSRVWSDQGHPLFWUDGLQJUHYHQXHDQGJURVV

PDUJLQEHQHࢉWGLGQRWUHSHDWLQ

'HVSLWHWKHFKDOOHQJHVLQWKHUHJLRQRXUIRFXV

UHPDLQVRQGHOLYHULQJDVWURQJFXVWRPHU

H[SHULHQFH2XUUROOLQJWZHOYHPRQWK136IRU

$VLD3DFLࢉFLPSURYHGWRFRPSDUHGZLWK

LQ

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 31

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Risks, viability and going concern

HOW WE MANAGE

OUR RISKS EFFECTIVELY

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 and

recognise that the right risk culture is vital in

assisting management and employees in the

avoidance of many potential organisational

GLࢇFXOWLHV7KH\DLPWRVHWWKHFRUUHFWWRQHIURP

the top and ensure that risk is an intrinsic element

of the governance structure.

Risk appetite

:HGHࢉQHRXUULVNDSSHWLWHDVWKHDPRXQWRI

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, our strategic actions,

along with national and international laws and

regulations within the areas in which we operate.

There is a low tolerance for health and safety risks,

regulatory risks or risks to the reputation of

the business. RS will not tolerate fraud or other

ࢉQDQFLDOFULPHVLQDQ\DVSHFWRILWVRSHUDWLRQVDQG

any suspected acts will be fully investigated and

prosecuted if appropriate. See pages 59 and 70 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

WKHPZKHUHQHFHVVDU\(ࢆHFWLYHULVNPDQDJHPHQW

empowers management and the organisation to

act with autonomy and accountability and supports

the Group to use risk information as a guide to

good decisions and help prioritise resources.

The risk framework is designed to identify

and mitigate potential risks proactively, ensure

regulatory compliance, enhance operational

HࢇFLHQF\DQGIRVWHUVWDNHKROGHUFRQࢉGHQFH

It is a strategic asset for safeguarding the Group’s

ࢉQDQFLDOKHDOWKPDQDJLQJRXUUHSXWDWLRQDQG

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. 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 function

risk leaders to provide bottom-up visibility of

possible risks.

Assessment of risks

7KHULVNRZQHULGHQWLࢉHVWKHFRQWUROVIRUHDFK

ULVNDQGDVVHVVHVWKHLPSDFWXVLQJERWKࢉQDQFLDO

DQGQRQࢉQDQFLDOFULWHULDDQGOLNHOLKRRGRIWKH

ULVNRFFXUULQJXVLQJFRQVLVWHQWPHDVXUHV7KHVH

DVVHVVPHQWVFRQVLGHUWKHHࢆHFWVRIWKHH[LVWLQJ

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

risk information across the Group and is reviewed

by the Group’s risk team.

Emerging risks

6RPHULVNVFDQQRWEHHDVLO\TXDQWLࢉHGRIWHQ

due to a lack of information to facilitate a clear

understanding of the consequences. These risks

are categorised as emerging and they are closely

monitored until more information is available.

The Group has risk management and internal control processes to identify,

DVVHVVPDQDJHDQGPRQLWRUWKHULVNVZKLFKKDYHWKHSRWHQWLDOWRDࢆHFWWKH

achievement of its strategy.

OUR RISK MANAGEMENT PROCESS

Identify potential risks

Assess

the risk

Determine and treat the risk

Monitor

and review

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 32

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

BEING

CYBER SECURE

Cyber security continues to be a key

concern for all businesses. However,

it is short-sighted to only consider

technological cyber security risks.

RS Group’s approach to cyber security

has a strong focus on human behaviour

and culture and our information security

team is passionate about helping our

people to stay safe online, whether at

work or at home.

:HWDNHDSHRSOHࢉUVWDSSURDFKWRRXU

education and awareness, recognising

that cyber security can be perceived as

complicated and overly technical. Our

information security team and our

education partners create engaging

and friendly content that ensures that

employees feel safe to reach out and ask

questions, and that they get answers in

plain language, not specialist jargon. This

LQFOXGHVGHOLYHULQJIDFHWRIDFHEULHࢉQJ

sessions as well as formal and informal

videos, how-to guides and blog posts.

MANAGING RISKS IN ACTION:

Recently, we performed a survey across all

employees to help understand their cyber

security awareness and tailor our approach

WRGLࢆHUHQWW\SHVRIOHDUQHUVDQGGLࢆHUHQW

SURࢉOHVRIULVN7KLVKDGDVWURQJUHVSRQVH

rate and we will be using the data gathered

to make further improvements in the

coming year.

We have also recently launched a new

training platform in conjunction with

a third-party specialist that continues

our people-focused approach to cyber

security awareness. This includes tools,

tricks and informative blog posts to keep

our employees up to date, as well as

quizzes to show them where they could

improve their online safety knowledge.

This platform is informed by research

in human psychology and corporate

anthropology and adopts a continual

learning approach, delivering smaller

courses on a regular basis rather than

a single annual training package. As well

as improving engagement, crucially this

enables both greater measurement and

greater remediation of human cyber risk.

Risks, viability and going concern continued

ACCOUNTABLE AND RESPONSIBLE TEAMS

Overall

accountability

Board

Overall accountability for the Group’s approach to risk management. Supported by the Audit

&RPPLWWHHWRHQVXUHHࢆHFWLYHLQWHUQDOFRQWUROVDQGULVNPDQDJHPHQWV\VWHPVWKH%RDUGDOVR

approves the Group’s risk appetite and the principal risks.

Executive Committee

Responsible for owning and reviewing the

Group’s risk management process, risks and

mitigating internal controls and making

recommendations to the Board.

Markets, businesses, regions

and Group functions

Identifying, reviewing and communicating

local risks using risk registers where applicable.

Risk owners

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, technology, legal,

compliance and environmental and health

and safety teams.

Supporting

teams

Operational Audit

2SHUDWLRQDO$XGLWDVSDUWRILWVVFKHGXOHGDXGLWVUHYLHZVWKHHࢆHFWLYHQHVVRIWKH*URXSȆV

mitigating controls for its risks.

Assurance

We take a people-ﬁrst approach to our

education and awareness, recognising that

cyber security can be perceived as complicated

and overly technical.”

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 33

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Cyber security

Risk theme: Operational

Change initiatives

Risk theme: Operational



M&A activity

Risk theme: Operational

:KDWLVWKHULVNDQGKRZFRXOGLWDࢆHFWXV"

A successful attack on our systems, sites, data or

DWKLUGSDUW\PHDQVWKDWFRQࢉGHQWLDOLQIRUPDWLRQLV

lost or business critical systems become unavailable

that may lead to negative customer or supplier

impacts, regulatory action, reputational damage

and / or loss of business and revenue.

:KDWLVWKHULVNDQGKRZFRXOGLWDࢆHFWXV"

We are not able to implement successfully a business

and technology change programme to deliver the

strategic agenda which could lead to a lack of

engagement and prioritisation for deployment

and embedding the required change initiatives

into the business.

:KDWLVWKHULVNDQGKRZFRXOGLWDࢆHFWXV"

We do not realise the appropriate value from

our acquisitions.

:KDWDUHZHGRLQJWRPDQDJHWKHULVN"

– Controls in place include technical and organisational

protection measures including:

ੳ Firewalls

ੳ Anti-malware software

ੳ 6WDࢆWUDLQLQJDQGDZDUHQHVV

ੳ Procedures to update security patches

ੳ Regular security testing

ੳ 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.

:KDWDUHZHGRLQJWRPDQDJHWKHULVN"

– The design and implementation of a robust strategic

delivery and execution framework, with sponsorship

and leadership by the members of the ExCo, supported

E\DGHࢉQHGJRYHUQDQFHSURFHVV

:KDWDUHZHGRLQJWRPDQDJHWKHULVN"

– Process to build and maintain a pipeline of

RSSRUWXQLWLHVLQFOXGLQJWKRURXJKVFUHHQLQJIRUࢉW

with our agreed strategy and with our culture.

– Rigorous due diligence and contract negotiation

processes, including full involvement of expertise

across our businesses, functions and (where

DSSURSULDWHH[WHUQDODGYLVRUV

– Clear value-focused returns criteria for investments,

expertise in comprehensive suite of valuation

techniques and a commercial approach to negotiation.

– Robust integration planning process closely linked with

the due diligence process; ownership of the business

plan and synergy targets by the acquiring business;

detailed synergy capture plan and strong governance

of post-acquisition delivery process.

:KDWDUHRXUIXWXUHDUHDVRIIRFXV"

– Continue to stay abreast of developments relating to

cyber security, including regulatory changes such as

7KH1HWZRUNDQG,QIRUPDWLRQ6HFXULW\1,6'LUHFWLYH

– As security threats continue to evolve, we also work

collaboratively with the National Cyber Security Centre

and other third-party security intelligence organisations.

:KDWDUHRXUIXWXUHDUHDVRIIRFXV"

– Deployment of a change management methodology

and creation of a community of practice.

– Provide regular reporting through the quarterly

business review process.

:KDWDUHRXUIXWXUHDUHDVRIIRFXV"

– &RQWLQXHWRDXGLWDQGUHࢉQHLQWHUQDOSURFHVVHV

– Continue to train and develop latest industry-standard

techniques for valuation, acquisition and integration.

5LVNVGLUHFWLRQGHࢉQLWLRQ

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



New risk

Risks, viability and going concern continued

Principal risks

7KH%RDUGDQG([&RFRQࢉUPWKDWWKH\KDYH

undertaken a robust assessment of the Group’s

principal and emerging risks, including those

that could threaten its business model, future

performance, solvency or liquidity, and assessed

them against the Group’s risk appetite.

For several principal risks, ExCo members will, as

part of their ongoing activities, update the Board

on these risks and their mitigation. This allows the

Board to determine whether the actions being

WDNHQE\PDQDJHPHQWDUHVXࢇFLHQW

OUR PRINCIPAL

RISKS AND

UNCERTAINTIES

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 34

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Talent and capability

Risk theme: Operational

Geopolitical environment

Risk theme: Operational

Market disruption

Risk theme: Strategy and change

:KDWLVWKHULVNDQGKRZFRXOGLWDࢆHFWXV"

If we are not able to attract, develop and retain

the necessary high-performing employees and

capabilities, we may not be able to meet our

ambitious strategic goals and maintain customer

service levels and relationships.

:KDWLVWKHULVNDQGKRZFRXOGLWDࢆHFWXV"

Future global destabilisation impacts our international

business activities, increasing operating costs,

additional trade sanctions, supply chain delays,

and / or hinders passage of products between our

distribution sites with delays and higher costs.

:KDWLVWKHULVNDQGKRZFRXOGLWDࢆHFWXV"

Unexpected changes in market buying behaviours

UHVXOWLQORZHUWKDQIRUHFDVWࢉQDQFLDOUHVXOWV

:KDWDUHZHGRLQJWRPDQDJHWKHULVN"

– Holistic people plan to create the right culture that

delivers on our employee vision.

– Upweighting succession planning with greater focus

on action follow up.

– Investing in leader and manager capability development.

– Improved cascade of objectives and improved

performance management.

:KDWDUHZHGRLQJWRPDQDJHWKHULVN"

– Continually monitoring the existing markets in which

the Group operates to identify potential uncertainties

that may impact our service to customers within

countries, regions or globally.

– 7KURXJKRXUVXSSOLHUGLUHFWDQGLQGLUHFWUHODWLRQVKLSV

identifying potential supply vulnerabilities and ensuring

appropriate resilience is in place.

– Considered as part of the due diligence process

when looking at potential acquisition targets.

– Continued investments in trade compliance

intelligence and capabilities.

:KDWDUHZHGRLQJWRPDQDJHWKHULVN"

– Continually assess what is ‘value’ to our customers

and the optimal ways to deliver this at an appropriate

return for the Group.

– Continue to improve our online user experience

WKURXJKULFKDQGGLࢆHUHQWLDWHGSURGXFWFRQWHQWWR

make it easier for customers to compare and select

the right product across an unrivalled product range.

– 0LWLJDWHF\FOLFDOLW\E\EXLOGLQJLQFUHDVHGࢊH[LELOLW\LQWR

our cost base and targeting less cyclical customer

verticals and product categories.

:KDWDUHRXUIXWXUHDUHDVRIIRFXV"

– Introducing strategic workforce planning to ensure

we have the capabilities required to deliver the strategy.

– Launching employee value proposition for external

attraction and internal retention.

:KDWDUHRXUIXWXUHDUHDVRIIRFXV"

– Increase share of local and nearshore sourcing

reduces singular risk from one sourcing market.

– Continued expansion of our product range in both

depth and breadth reduces dependency on any

VSHFLࢉFVXSSOLHURUVRXUFLQJPDUNHW

:KDWDUHRXUIXWXUHDUHDVRIIRFXV"

– Continued targeted expansion of our product range

in both depth and breadth to ensure we cover our

customers’ existing and future needs, including

horizon-scanning on future technologies and driving

consolidation of customers’ purchases with us.

– )XUWKHUGHYHORSPHQWRIVROXWLRQVRࢆHULQJWR

provide more value to customers and enhance

customer loyalty.

Risks, viability and going concern continued

5LVNVGLUHFWLRQGHࢉQLWLRQ

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



New risk

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 35

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Business resilience

Risk theme: Operational

Climate change

Risk theme: Operational

Access to debt and capital markets

Risk theme: Financial resilience



:KDWLVWKHULVNDQGKRZFRXOGLWDࢆHFWXV"

We are not adequately prepared for a major business

disruption, caused by an unplanned event disrupting

FULWLFDOLQIUDVWUXFWXUHSK\VLFDODQGRUGLJLWDODVVHWV

and cannot carry out key processes and functions.

:KDWLVWKHULVNDQGKRZFRXOGLWDࢆHFWXV"

We do not adequately manage the potential impacts

RQWKHEXVLQHVVGXHWRFOLPDWHFKDQJHHࢆHFWV7KLV

could be either:

– The physical risks of more extreme weather conditions

LQFOXGLQJKHDWZDYHVVWRUPVRUࢊRRGVFRXOGLPSDFW

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

WHFKQRORJLHVFRXOGOHDGWRUHGXFHGUHYHQXHRU

reduced customer NPS.

:KDWLVWKHULVNDQGKRZFRXOGLWDࢆHFWXV"

We are not able to access adequate capital to support

ongoing operations and future growth. This may

impact us in that we cannot generate adequate cash

ࢊRZWRVXSSRUWGD\WRGD\RSHUDWLRQVFDQQRWDFFHVV

ࢉQDQFLQJWRVXSSRUWRUJDQLFDQGLQRUJDQLF

investments and / or do not have adequate debt

facilities to operate as a going concern.

:KDWDUHZHGRLQJWRPDQDJHWKHULVN"

– *OREDOVXSSO\FKDLQQHWZRUNZLWKWKHDELOLW\WRIXOࢉO

customer orders by another distribution site and

maintain service.

– Ongoing assessments of critical third-party inventory

suppliers and appropriate inventory levels to mitigate

ULVNZKHUHLGHQWLࢉHG

– 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.

:KDWDUHZHGRLQJWRPDQDJHWKHULVN"

– Refreshed our climate scenario analysis, to overlay

FOLPDWHVFHQDULRVRQWRRXUࢉYH\HDUVWUDWHJLFSODQ

– Continued to expand our sustainable products,

including our Better World product range, to support

our customers’ climate goals.

– Improved our supply chain and operational capabilities,

to reduce emissions from our distribution sites and

product shipments.

– Continued to invest in measures to improve operational

resilience at our distribution sites.

– Supporting new RS businesses to develop and execute

WKHLUࢉUVWSKDVHGHFDUERQLVDWLRQSODQV

:KDWDUHZHGRLQJWRPDQDJHWKHULVN"

– Cash forecasting and working capital management.

– Proactive investor relations programme for equity.

– 'LYHUVLࢉFDWLRQRIIXQGLQJVRXUFHV

– 'LYHUVLࢉFDWLRQRIGHEWIXQGLQJPDWXULWLHV

– ([LVWLQJIDFLOLWLHVUHࢉQDQFHGLQH[FHVVRIPRQWKV

prior to maturity.

– Robust bank relationship management with

appropriate distribution of ancillary business.

:KDWDUHRXUIXWXUHDUHDVRIIRFXV"

– Continued expansion of product ranges stocked closer

to customers to reduce dependency on individual

distribution sites within the network.

– Continue to update legacy systems and test disaster

recovery of existing systems.

:KDWDUHRXUIXWXUHDUHDVRIIRFXV"

– &RQWLQXHWRJURZRXUFXVWRPHURࢆHULQJVDQGUHYHQXH

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.

– Recent acquisitions have impacted the Group’s

carbon reduction progress. Investment will be

required to decarbonise these businesses (and future

DFTXLVLWLRQVWRFRQWLQXHWRPHHWWKH*URXSȆVWDUJHW

to be net zero in its direct operations by 2030 and

avoid reputational risk.

:KDWDUHRXUIXWXUHDUHDVRIIRFXV"

– Ongoing evaluation of alternative lenders and

funding sources.

– Alignment with strategic forecasts and awareness

of M&A pipeline to ensure preparedness for future

funding needs.

– Continuous assessment of the debt markets and

bank economic advice to make opportunistic

funding decisions and avoid future economic

adverse conditions.

Risks, viability and going concern continued

5LVNVGLUHFWLRQGHࢉQLWLRQ

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



New risk

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 36

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Legal and regulatory compliance

Risk theme: Regulatory compliance

:KDWLVWKHULVNDQGKRZFRXOGLWDࢆHFWXV"

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

UHJXODWLRQVDFURVVGLࢆHUHQWPDUNHWV

– Breaches of any other regulatory or legislative

requirements (such as the UK Bribery Act 2010 and

&ULPLQDO)LQDQFHV$FW

– Non-conformance with operational compliance,

AI policies and NIS2 directive.

:KDWDUHZHGRLQJWRPDQDJHWKHULVN"

– 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.

:KDWDUHRXUIXWXUHDUHDVRIIRFXV"

– Implementing a monitoring programme focused

on key ethics and compliance risks.

– Continued awareness campaign and promotion

of the Speak Up process.

– Focused training on fraud for key roles within

the business.

– Global review process to be introduced to review

and challenge submissions.

– Review and monitoring of AI use across RS.

Risks, viability and going concern continued

Our AI governance strategy aims to balance the

beneﬁt and business opportunity with the risks

that it entails.

OUR APPROACH

TO AI GOVERNANCE

MANAGING RISKS IN ACTION:

Similar to our approach to other

technological developments in recent

history, such as cloud computing, 3D

printing or video conferencing, our AI

governance strategy aims to balance

WKHEHQHࢉWDQGEXVLQHVVRSSRUWXQLW\RI

using this new technology with the risks

that it entails (notably on quality, bias,

accuracy of output, reputational, legal or

VHFXULW\LVVXHV:KLOHZHGRQRWZDQWWR

VWLࢊHLQQRYDWLRQDQ\GHSOR\PHQWRI$,

within the Group must be done safely

and in line with risk appetite.

We have put in place a series of controls

DGDSWHGWRWKHULVNSURࢉOHRIWKH*URXS

as a user of AI tools:

– A new Group AI Policy was launched in

April 2024 with guidance for our people

on how to use AI tools

– Key principles of the policy have been

showcased as part of the Code of

Conduct and Privacy training

– An AI community was formed in

December 2023 with representatives

from Technology, Information Security,

Group Legal and Compliance as well as

Indirect Procurement. This community

is being expanded to cover regional

representation as well. Colleagues who

wish to use an AI tool at work can seek

advice from the AI community through the

Innovation Forum

– Technology colleagues are reviewing the

IT systems catalogue to assess current

AI usage

– Questions targeting AI usage have been

EXLOWLQWRWKHVXSSOLHUSUHTXDOLࢉFDWLRQ

questionnaire as part of the procurement

process. This will prevent our suppliers

adding AI capabilities as part of their

VHUYLFHRࢆHULQJIRUWKH*URXSZLWKRXW

express permission

– Suppliers are also asked to sign bespoke

clauses to cover the Group on AI risk

Looking ahead, the Group will need

to navigate an evolving global legal

framework around the world. The EU is

currently leading the charge with an AI

Regulation, expected to apply fully by 2026

across all EU member states. We will be

closely monitoring legal developments with

a particular focus on the EU AI Regulation

in order to assess further implications for

the Group and adapt our internal control

framework accordingly. The AI community

will continue to advise our colleagues on

implementing AI safely but will also seek to

develop an AI toolkit to enable self-service

DQGLQFUHDVHHࢇFLHQFLHV

5LVNVGLUHFWLRQGHࢉQLWLRQ

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



New risk

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 37

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Viability statement

Assessment of prospects

Our business model and strategy, as described

on page 13, 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,

with its largest customer accounting for under

one percent of revenue and its largest supplier

OHVVWKDQࢉYHSHUFHQWRIUHYHQXH2XUEXVLQHVV

PRGHOLVGLࢆHUHQWLDWHGE\RXUJOREDOQHWZRUNRI

distribution sites; our customer-centric team; our

strong supplier relationships; our broad and deep

SURGXFWRࢆHULQJDQGVHUYLFHVROXWLRQVFDSDELOLWLHV

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.

7KH*URXSȆVUHVXOWVDQGࢉQDQFLDOSRVLWLRQDUH

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

PDQDJHPHQWDFFRXQWVLQFOXGLQJFDVKࢊRZVDQG

also receives regular performance and forecast

updates from the CFO and CEO.

We update our detailed rolling 18-month forecast

of the Group’s income statement, balance sheet

DQGFDVKࢊRZVIUHTXHQWO\ZKLFKDUHUHJXODUO\

reviewed, and the assumptions approved, by

the Board.

The Group’s long-term prospects are assessed

SULPDULO\WKURXJKRXUVWUDWHJLFDQGࢉQDQFLDO

planning process. This includes the preparation

RIDࢉYH\HDUVWUDWHJLFSODQDQGDQDQQXDOEXGJHW

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

system, as described on pages 32 and 80 to 83.

2XUUHJXODUFDVKࢊRZIRUHFDVWVHQDEOHXVWR

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 April 2023 we took out a new

€150 million three-year term loan to partly fund

our acquisition of Distrelec and in October 2023

our request to take up one of the one-year term

extensions to the £400 million SLL facility was

approved by lenders and so now matures in

October 2028. Only £155 million of this facility

was drawn down at 31 March 2024.

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 unwinding of our

SRVWSDQGHPLFWUDGLQJEHQHࢉW$VDUHVXOW

like-for-like revenue declined by 8% and adjusted

IUHHFDVKࢊRZIHOOE\WRePLOOLRQOHDGLQJ

to net debt of £418 million (including lease

OLDELOLWLHVRIePLOOLRQDW0DUFK:H

also paid dividends during the year of £104 million

ePLOOLRQDQGWKHDFTXLVLWLRQZH

completed during the year increased net debt

by £333 million. We have ended the year with

a strong balance sheet.

'HWDLOVRIRXUVRXUFHVRIࢉQDQFHDUHRXWOLQHGLQ

Note 23 on page 163, with the earliest facilities

maturing being the three-year term loan and

two tranches of our private placement loan notes

in 2026/27.

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 2024

(%,7$WRLQWHUHVWZDV[[DQG

net debt to adjusted EBITDA was 1.1x (2022/23:

[VHH1RWHRQSDJHVDQGIRU

UHFRQFLOLDWLRQVDQGXQGHURXUVWUDWHJLFSODQ

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 2027 continues to be most appropriate.

7KHUREXVWQHVVRIWKHVWUDWHJLFSODQLVVLJQLࢉFDQWO\

KLJKHULQWKHࢉUVWWKUHH\HDUVZLWKWKHࢉQDOWZR

years being a high-level extrapolation. 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 34 to 37 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 2024

Board meeting, adjusted to include the estimated

HࢆHFWRIRXUDFTXLVLWLRQRI7ULGHQWLQ$SULOLV

FRQVLGHUHGWRUHࢊHFWWKH%RDUGȆVFXUUHQWO\EHVW

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 adjusted

strategic plan to quantify the potential impact

of one or more of them crystallising over the

assessment period.

Risks, viability and going concern continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 38

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

In performing the above tests it was assumed

WKDWQRPDMRUUHRUJDQLVDWLRQVRUVLJQLࢉFDQW

working capital initiatives occur in mitigation,

capital expenditure is not lower than that in the

strategic plan, dividends continue to be paid and

there are no changes in or extensions to debt

ࢉQDQFLQJ$VDUHVXOWDOOWKHDERYHWHVWVPRGHOWKH

new principal risk and uncertainty ‘Access to debt

and capital markets’.

In none of the stress tests were the Group’s

covenants breached nor were the Group’s debt

facilities used up. The results of the stress tests

to the left 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

*URXSȆVFXUUHQWࢉQDQFLQJDUUDQJHPHQWV7KHVH

LQFOXGHGVLJQLࢉFDQWGHFOLQHVLQUHYHQXHVLJQLࢉFDQW

declines in revenue and gross margin and a major

deterioration in cash collection and would have to

UHVXOWLQDGMXVWHGRSHUDWLQJSURࢉWPDUJLQIDOOLQJ

to under 5% in at least one of the following three

years. Also, a reverse stress test of an acquisition

RIDVLJQLࢉFDQWO\ORVVPDNLQJEXVLQHVVZDV

undertaken and would have to cost over

£300 million to use up our debt facilities. All these

reverse stress tests assumed that no major

UHRUJDQLVDWLRQVRUVLJQLࢉFDQWZRUNLQJFDSLWDO

initiatives occur in mitigation, capital expenditure

is unchanged from that in the strategic plan,

dividends continue to be paid and there are no

FKDQJHVLQRUH[WHQVLRQVWRGHEWࢉQDQFLQJ7KH

Board considers the risk of these circumstances

occurring to be remote.

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 2027.

Going concern

7KHJRLQJFRQFHUQSHULRGLVGHࢉQHGDVDSHULRG

of at least 12 months from 22 May 2024.

Based on the assessment outline above and the

output of our detailed rolling 18-month forecasts,

the Board believes that it is appropriate to continue

to adopt the going concern basis in preparing the

Group’s accounts.

The scenarios and related stress tests modelled and how they link

to the principal risks and uncertainties were:

Scenario and related stress tests modelled Link to principal risk and uncertainties

Revenue and gross margin down with no

cost mitigations

Revenue falls in 2024/25 by more than the

like-for-like decline in 2023/24, with a further

decline in 2025/26. Gross margin declines in

2024/25 to 40% and operating costs stay static

as no mitigation is taken. Costs move in line with

revenue in future years.

–Change initiatives

–M&A activity

– Talent and capability

– Geopolitical environment

– Market disruption

– Climate change

– Legal and regulatory compliance

Cash collection down

Cash collection from trade receivables

deteriorates leading to trade receivables

impaired by 2% of revenue in 2024/25.

– Geopolitical environment

6LJQLࢉFDQWLQIUDVWUXFWXUHIDLOXUH

Major incident at the distribution site with

the largest impact, destroying the building

and its contents.

–Business resilience

– Climate change

Major cyber breach / information loss

Major system failure (possibly caused by a cyber

DWWDFNOHDGLQJWRDVHULRXVORVVRIVHUYLFHࢉQHV

for data breach and loss of reputation leading

to halving of revenue growth.

– Cyber security

–Business resilience

Risks, viability and going concern continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 39

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Environmental, social and governance (ESG)

Advancing sustainability 42

Championing education and innovation 50

Empowering our people 52

Doing business responsibly 58

CREATING

VALUE

FORA BETTER

WORLD

Read more about our ESG approach

at: rsgroup.com/sustainability

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 40

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

FOR A

BETTER WORLD

2XUSXUSRVHPDNLQJDPD]LQJKDSSHQIRUDEHWWHUZRUOGUHࢊHFWV

RXUFRPPLWPHQWWRGHOLYHULQJUHVXOWVIRUSHRSOHSODQHWDQGSURࢉW

To create value for all our stakeholders, our 2030 ESG action plan

targets four global goals and 15 actions where we are driving

SRVLWLYHFKDQJH

Our 2030 ESG action plan

We continue to take ESG action to support

our 1.1 million customers, c. 9,000 people and

over 2,500 global suppliers. By targeting the

*URXSȆVPRVWPDWHULDO(6*DFWLRQVDVLGHQWLࢉHG

through our Corporate Sustainability Reporting

Directive (CSRD) aligned double materiality

assessment, we are enabling our strategy,

strengthening relationships and generating

value for all our stakeholders.

Our ESG action plan supports six UN SDGs.

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 15 actions outlined on pages 42 to 61.

All 2023/24 and 2022/23 ESG data now includes

post-acquisition data for businesses acquired

by the Group in 2022/23 and 2023/24, 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, head to: rsgroup.com/sustainability

Supporting six United Nations

Sustainable Development Goals

(UN SDGs):

OUR 2030 ESG ACTION PLAN

GLOBAL GOALS KEY ACTION AREAS PERFORMANCE HIGHLIGHTS

Advancing sustainability

Developing sustainable

operations and product and

service solutions for our

customers and suppliers

Net zero emissions in direct

operations by 2030, value

chain before 2050; Science

Based Targets initiative (SBTi),

UN Global Compact’s Business

Ambition for 1.5°C and UN Race

to Zero commitments

61%

reduction

in Scope 1 and 2

emissions since 2019/20

excluding acquisitions

53%

of our packaging has

>50% recycled content,

an increase of 6% pts

since 2022/23

26%

reduction in Scope 3

transport emissions

intensity

since 2019/20

Championing education

and innovation

Partnering with education providers,

building skills and fostering innovative

solutions that improve lives

Building skills and fostering

innovation with PLOOLRQ

engineers and innovators

c. 5,200

educational institutions

use our products in

their teaching

£628k

raised for The Washing

Machine Project (TWMP)

to improve lives since

2019/20

1.4m

DesignSpark members,

including professional

design engineers and

students

Empowering our people

Creating a safe, inclusive and

dynamic culture where everyone

can thrive and grow

Working towards a diverse

leadership team of 37% to 42%

women and 17% to 22%

ethnically diverse leaders

employee engagement

score – down from 78

in 2022/23

34%

of our senior leaders are

women and 11% are

ethnically diverse

46%

reduction in our all

accident frequency

rate

since 2019/20

Doing business responsibly

Ensuring the highest ethical

standards throughout our

business and global supply chain

Increasing screening and

(6*REMHFWLYHVIRUVXSSOLHUV

ESG metrics in employee

rewards and sustainability-

linked loan (SLL)

45%

of employees have

their annual incentives

aligned to carbon

reduction targets

32%

of suppliers by spend

set science-based

targets (SBTs)

66%

of RS PRO suppliers

are Sedex members

1. Excludes acquisitions completed in 2022/23 and 2023/24. Scope 1 and 2 emissions have been updated to

UHࢊHFWUHSRUWLQJDQGHPLVVLRQVIDFWRUFKDQJHV

2. Tonnes of CO

e due to Scope 3 transportation emissions per tonne of product sold.

3. We have updated our 2030 D&I actions in 2023/24. See pages 54 and 55 for more.

 RIVHQLRUPDQDJHUVVHOIUHSRUWHGHWKQLFLW\YLDWKHHPSOR\HHGDWDEDVHLQFOXGLQJQRWVSHFLࢉHG

SUHIHUQRWWRVD\DQGLGHQWLࢉHGDVQRQZKLWH

5. Per 200,000 hours worked.

ESG continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 41

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

ADVANCING

SUSTAINABILITY

As a critical partner to the global industrial

sector, we play an important role in advancing

VXVWDLQDELOLW\DQGWDFNOLQJFOLPDWHFKDQJH

By developing a cleaner and greener

distribution service and providing sustainable

product and service solutions, we can make

D UHDODQGODVWLQJLPSDFWDQGGLࢆHUHQWLDWHRXU

brand as a strategic partner to our customers

DQGVXSSOLHUV

Status key

Each of our actions are broken down into annual targets that need to be met to remain on

WUDFNWRDFKLHYHRXUDQGJRDOV7KHNH\EHORZUHࢊHFWVRXUFXUUHQWSRVLWLRQ

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

1. By 2029/30 from 2019/20.

2. Performance excludes acquisitions completed in 2022/23 and 2023/24.

 6FRSHDQGHPLVVLRQVXSGDWHGWRUHࢊHFWUHSRUWLQJDQGHPLVVLRQVIDFWRU FKDQJHV

4. Tonnes per £m revenue.

5. Tonnes of CO

e due to Scope 3 transport emissions per tonne of product sold.

ESG continued

2030 ACTIONS PERFORMANCE STATUS COMMENTARY READ MORE

By 2030 in our direct operations:

– Carbon emissions: Be net zero with

a SBT to reduce absolute emissions

from our own operations by 75%

61%

reduction in Scope 1

and 2 emissions since 2019/20

excluding recent acquisitions

2,3

Positive progress made from site energy savings,

switching to renewable electricity and creating

D QHW]HURࢊHHW,QFOXGLQJDFTXLVLWLRQVGLUHFW

emissions increased by 19% from 5,700 tCO

in 2022/23 to 6,800 tCO

e in 2023/24

Pages 43 to 46

rsgroup.com/

sustainability

– Packaging: Make our packaging

more sustainable: reduce intensity by

30%

, with 100% of packaging widely

reusable or recyclable and made with

at least 50% recycled content

35%

reduction in packaging intensity

since 2019/20

Packaging intensity decreased by 8% from

2022/23 and by 35% since 2019/20 with recent

acquisitions included. Positive progress due to

reducing customer packaging and using

reusable eco-totes in internal systems

– Recycling and waste: Reduce,

reuse and recycle our waste: reduce

intensity by 50%

, recycle > 95% and

DFKLHYH]HURZDVWHWRODQGࢉOOLQRXU

direct operations

82%

of total waste recycled

Overall percentage of waste recycled improved

as we continued to prioritise better waste

segregation, recycling and reuse. For example,

our global distribution centre (DC) in Nuneaton,

UK increased its recycling rate from 74% to 87%

Working towards a net zero

global value chain by 2050:

– Product transportation: Reduce

Scope 3 transport emissions by 25%

per tonne of product sold

26%

reduction in intensity of Scope 3

transport emissions since 2019/20

Ongoing progress by prioritising modal shifts

and optimising our supply chain to source, store

and ship more products locally to customers

through our distribution sites. However, our

intensity KPI was impacted by a change in global

emissions factors and supply chain challenges

Pages 47 to 49

– Products and solutions: Develop

innovative and sustainable product

and service solutions for all our

FXVWRPHUVLQFOXGLQJRࢆHULQJ

100,000 Better World products

c. 30k

products in the Better World

product range

Increased Better World product range to

c. 30,000 products from over 90 suppliers,

available in 30 countries worldwide. We also

launched new solutions to help our customers

run their businesses more sustainably

– Supplier engagement: Commit to

engaging 67% of suppliers by spend

to set SBTs by 2025

32%

of suppliers by spend have set SBTs

Positive seven percentage point increase in

VXSSOLHUVVHWWLQJ6%7VGXULQJWKH\HDUEXWRࢆ

track to meet our 2025 target. We will continue

to engage suppliers in ESG action in 2024/25

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 42

Access to

technologies

Government policies

and incentives

Energy grid

decarbonisation

Gold Standard

FHUWLࢉHGRࢆVHWV

Our net zero plan

ESG continued

1. Performance excludes acquisitions completed in 2022/23 and 2023/24. 2. Tonnes of CO

e due to Scope 3 transport emissions per tonne of product sold.

Our ambition is to be net zero in our direct operations by 2030 and across our wider value chain by 2050. For RS, this means implementing our science-based emissions reduction targets across Scope 1, 2 and 3

HPLVVLRQVDQGXVLQJFHUWLࢉHG*ROG6WDQGDUGRࢆVHWVIRUDQ\DGGLWLRQDOUHVLGXDOKDUGWRDEDWHHPLVVLRQV7RDFKLHYHWKLVZHKDYHVHWIRXU6%7VZKLFKZHUHYDOLGDWHGE\WKH6%7LLQDQGFRYHUWKH*URXSȆV

most material operational activities, 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 44 to 47, our Task Force on Climate-

related Financial Disclosures (TCFD) response on pages 62 to 67 and our independent assurance statement from ERM CVS on pages 68 and 69.

Net zero across our direct operations by 2030 pages 44 and 45 Net zero across our value chain by 2050 pages 47 to 49

Upgrading our distribution sites

to be more automated, energy

HࢇFLHQWDQGVXVWDLQDEOHWR

provide a better service to our

customers and reduce our

environmental impacts.

Key actions in 2023/24:

– Implemented environmental

management dashboards at our

10 largest sites which include

monthly emissions reduction

targets and monitoring

– 0RYHGWRDQHZHQHUJ\HࢇFLHQW

ORFDOIXOࢉOPHQWFHQWUH)&LQ

Madrid, Spain and progressed

multi-year project to improve

WKHHࢇFLHQF\RIRXUUHJLRQDO

DC in Beauvais, France

– Worked with a third-party

decarbonisation partner at our

regional DC in Bad Hersfeld,

Germany to create a net zero plan

Impact:

reduction in premises energy use

in 2023/24 excluding acquisitions

We are committed to taking action to decarbonise our direct operations. Our three priority areas are: 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:

Generating and procuring

renewable electricity by installing

solar photovoltaic panels on

our buildings and procuring

green electricity.

Key actions in 2023/24:

– Installed solar panels at our FC in

Midrand, South Africa which have

provided over 45% of the site’s

electricity use since October 2023

– Solar panels on the roof of our FC in

Madrid, Spain

– Group Energy Management Policy

promoted to all owned and leased

sites to procure green electricity

where available. Where purchasing

DUHQHZDEOHHQHUJ\WDULࢆLVQRW

possible, we purchase Energy

$WWULEXWH&HUWLࢉFDWHVIRUVHOHFWVLWHV

Impact:

90%

renewable electricity

use in 2023/24

Transitioning our company car

ࢊHHWWRHOHFWULFDQGK\EULGYHKLFOHV

and encouraging adoption with

our people.

Key actions in 2023/24:

– Installed over 40 additional electric

charging points in locations across

the UK

– $FFHOHUDWHG8.ࢊHHWSROLF\WR

mandate the switch to hybrid or

electric vehicles (EVs) to reach our

2030 target

– Established cross-functional

working groups to roll out EV

and hybrid company car policy

to EMEA markets

Impact:

30%

Group company cars and 82% of

8.ࢊHHWDUHHOHFWULFRUK\EULG

Expanding our range of

sustainable product and

service solutions to help

customers reduce costs, save

resources and achieve their

environmental goals.

Key actions in 2023/24:

– Increased the number of Better

World products in our range and

broadened our framework to

target multiple sustainability

improvements across the

product lifecycle (see page 48)

– Continued to expand our

sustainability-focused

maintenance, repair and

operation (MRO) services, such

as energy monitoring and

compressed air surveys (see

page 49)

Impact:

c. 30k

%HWWHU:RUOGSURGXFWVRࢆHUHG

to customers in 2023/24

Cutting the distance our products

travel by sourcing, storing and

shipping closer to customers and

suppliers and switching to less

carbon intensive modalities.

Key actions in 2023/24:

– Product replenishments from the UK

to our regional DC in Fort Worth, US

moved to sea and road deliveries,

rather than air, to reduce emissions

– Optimised our regional DC in Bad

Hersfeld, Germany to enable more

European customers to be served

locally by road

– Increased carrier engagement and

selection based on sustainability

principles

Impact:

26%

reduction in product transport

intensity since 2019/20

Collaborating with our suppliers

to prioritise carbon reduction

activities that drive reductions

across the value chain, including

sourcing, designing,

manufacturing and shipping

products more sustainably.

Key actions in 2023/24:

– Engaged with our top 67% of

suppliers by spend to act on four

sustainability priorities detailed in

our ESG supplier handbook,

including setting SBTs and

becoming members of EcoVadis

or Sedex (see page 61)

– Conducted c. 300 meetings with

suppliers to target development

of more sustainable products,

for inclusion in the Better World

product range

Impact:

32%

suppliers by spend set carbon

targets with SBTi

Enabled by:

'HFDUERQLVLQJ

our buildings

6XVWDLQDEOHSURGXFW

and service solutions

6ZLWFKLQJWR

renewable electricity

&UHDWLQJD

QHW]HURࢊHHW

3URGXFW

transportation

6XSSOLHU

engagement

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 43

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

29/3026/2723/2419/20

’000 tonnes CO

Min 75% SBT reduction

19/20–29/30

Trajectory for 1.5°C

Offsets to net zero

Net zero trajectory

Actual performance 19/20 to 23/24

Our performance & trajectory to 2029/30

Scope 1 and 2 emissions (tonnes CO

Excluding recent acquisitions

4,600

10% reduction from 2022/23

Including recent acquisitions

6,800

19% increase from 2022/23

Carbon intensity (tonnes CO

e/£m)

Excluding recent acquisitions

1.8

Unchanged from 2022/23

Including recent acquisitions

2.3

21% increase from 2022/23

In 2023/24, we integrated post-acquisition data

from our acquisitions completed in 2022/23 and

2023/24

into our Scope 1 and 2 emissions

reporting. This has increased our direct carbon

footprint from 5,100 to 5,700 tonnes CO

e in

2022/23 and from 4,600 to 6,800 tonnes CO

in 2023/24. Risoul, our industrial product and

service solutions business in Mexico, has had

DVLJQLࢉFDQWLPSDFWRQRXUGLUHFWRSHUDWLRQDO

IRRWSULQWDVLWRZQVLWVࢊHHWRIORJLVWLFVYHKLFOHV

to deliver products directly to customers.

We have restated our historic emissions to

include emissions from businesses acquired in

2022/23 and 2023/24. This is summarised in the

Scope 1 and 2 emissions table (bottom right),

along with our pathway to net zero in our direct

operations (top right) which shows our updated

trajectory towards meeting our ambitions.

Pathway to net zero

We remain committed to achieving our Group

net zero ambition and to working with our

acquired businesses to decarbonise their

operations and inspire action with customers

and suppliers.

Our ESG team is proactively supporting

operational teams at our acquired businesses

RI'+5LVRXODQG'LVWUHOHFWRGHYHORSࢉUVWSKDVH

decarbonisation plans aligned to the Group’s net

zero ambition and SBTs. Initial plans will focus on

VLWHHQHUJ\HࢇFLHQF\RSWLRQVIRUUHQHZDEOH

electricity, hybrid and electric vehicles and

logistics optimisation.

We will share more information on our plans and

progress in our climate transition plan which will

be published in line with compliance timelines.

Advancing sustainability within our business

ESG continued

Scope 1 and 2 emissions

(tonnes CO

Change

from 2020 2024 2023 2022

Excluding recent acquisitions

(61)% 4,600 5,100 6,300

Including emissions from acquired businesses,

from the point of RS ownership

(43)% 6,800 5,700 6,300

Including emissions from acquired businesses,

in 2019/20 baseline year (SBTi target)

(57)% 6,800 7,300 8,500

Carbon emissions (Scope 1 and 2) 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 SBTi to reduce absolute emissions

IURPRXURZQRSHUDWLRQVE\DQGZLOOXVH*ROG6WDQGDUGFHUWLࢉHGRࢆVHWVFORVHUWRIRUDQ\UHVLGXDOKDUGWRDEDWHHPLVVLRQV

 .3,VDUHRQDFRQVWDQWH[FKDQJHUDWHEDVLVDQGXSGDWHGWRUHࢊHFWFKDQJHVLQUHSRUWLQJPHWKRGRORJ\HPLVVLRQVIDFWRUVDQG

DGGLWLRQDOGDWD&RYHUDJHLQFOXGHVRSHUDWLRQVXQGHURXUGLUHFWࢉQDQFLDOFRQWUROJOREDOO\

2. Performance excludes acquisitions completed in 2022/23 and 2023/24.

3. Includes post-acquisition data from acquired businesses domnick hunter-RL (Thailand) Co., Ltd. (DH) and Risoul y Cia, S.A. de C.V.

(Risoul) (completed in 2022/23) and Distrelec B.V (Distrelec) (completed in 2023/24).

4. Performance and plan re-based to 2019/20 to include emissions from acquired businesses.

Our pathway to net zero in our direct operations

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 44

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

6,800

5,700

6,300

7,500

23/24

22/2321/2220/2119/20

11,900

6.2

3.8

2.4

1.8

1.9

2.3

Carbon emissions (Scope 1 and 2) in our direct operations continued

ESG continued

Greenhouse gas (GHG) emissions (Scope 1 and 2) and SECR disclosure

Metric 2024 2023

Group Scope 1 emissions

Combustion of fossil fuels

tonnes CO

e6,0225,067

Operation of facilities, including fugitive emissions

tonnes CO

e119113

Group Scope 2 emissions

Purchased electricity (market-based) tonnes CO

788 594

Electricity use from renewable sources % Group electricity 90% 91%

Electricity use from own renewable generation % Group electricity 2% 2%

Intensity metric

e due to premises energy and vehicles use

per £m revenue

tonnes CO

e / £m 2.3 1.9

Total GHGs per £m revenue

tonnes CO

e / £m 2.4 2.0

SECR disclosures

UK total Scope 1 and 2 emissions (market-based) tonnes CO

e2,6143,114

UK energy consumption GWh 26.3 29.2

1. Performance excludes acquisitions completed in 2022/23 and 2023/24.

2. 2022/23 Scope 1 and 2 CO

e emissions restated as 5,700 tonnes to include businesses acquired in 2022/23.

3. Figure includes 119 tonnes of CO

e due to fugitive emissions from air-conditioning systems (2022/23: 113 tonnes), which are

not included in our reported Scope 1 and 2 emissions of 6,800 tonnes CO

 .3,VDUHRQDFRQVWDQWH[FKDQJHUDWHEDVLVDQGXSGDWHGWRUHࢊHFWFKDQJHVLQUHSRUWLQJPHWKRGRORJ\HPLVVLRQVIDFWRUVDQG

DGGLWLRQDOGDWD&RYHUDJHLQFOXGHVRSHUDWLRQVXQGHURXUGLUHFWࢉQDQFLDOFRQWUROJOREDOO\

5. Includes emissions of 3,656 tonnes relating to fuel use in company vehicles (2022/23: 2,534 tonnes).

6. Scope 2 emissions calculated using CO

factors as CO

e factors are not consistently available for all countries. Market-based

emissions from electricity purchased from renewable sources were nil tonnes CO

(2022/23: nil). Market-based emissions from

electricity purchased from non-renewable sources calculated using grid average emission factors. Location-based Scope 2

emissions calculated using grid average factors were 7,630 tonnes CO

(2022/23: 7,609 tonnes).

7. SECR: UK emissions were 38% of global market-based emissions. UK energy use, including vehicle energy use, was

46% of global energy use.

*+*VDUHFDOFXODWHGLQOLQHZLWKWKH*+*3URWRFRO&RUSRUDWH6WDQGDUGXVLQJ8.'HSDUWPHQWIRU(QYLURQPHQW)RRG5XUDO$ࢆDLUV

DQGFRXQWU\VSHFLࢉFJULGDYHUDJH,QWHUQDWLRQDO(QHUJ\$JHQF\HPLVVLRQVIDFWRUV)XUWKHUGHWDLOVFDQEHIRXQGLQRXUEDVLVRI

reporting document and ESG data centre on our website: rsgroup.com/sustainability

We continued to make strong progress in

reducing our Scope 1 and 2 emissions in

our existing business in 2023/24, achieving

a 10% reduction from 2022/23 excluding

recent acquisitions

This was driven by continued activities to reduce

energy consumption across our distribution sites,

switching to renewable electricity and progressing

WRZDUGVDQHOHFWULFDQGK\EULGFRPSDQ\FDUࢊHHW

in the UK.

7KURXJKFRQWLQXHGHQHUJ\HࢇFLHQF\

improvements at our sites, we achieved a 4%

reduction in energy consumption in 2023/24

and a 9% reduction from 2019/20

. The Group’s

energy intensity has reduced by 33% since our

baseline year of 2019/20

1,4

. We also increased

the proportion of our UK company cars that

are electric or hybrid to 82% (2022/23: 54%).

Carbon reduction will remain a key focus in

2024/25. This is a core KPI for the Group and 45%

of our people and leaders are incentivised to drive

progress through the Scope 1 and 2 emissions

reduction metric in the annual incentive (page 60).

Streamlined Energy and Carbon

Reporting (SECR) disclosure

In accordance with UK SECR requirements, our

2023/24 Group Scope 1 and 2 emissions are

summarised in the table to the right and restated

to include post-acquisition data from acquisitions

completed in 2022/23 and 2023/24. Our Scope 3

emissions performance breakdown by material

category can be found on page 47.

Environmental Management

Systems (EMS)

All 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, 37 distribution

sites covering 49% of our operations by revenue

DQGE\ࢊRRUDUHDDUHFRYHUHGE\,62

HQYLURQPHQWDOPDQDJHPHQWFHUWLࢉFDWLRQV

e (tonnes) due to 2022/23 and 2023/24 acquisitions

e (tonnes) excluding recent acquisitions

e intensity (tonnes CO

e / £m revenue) excluding recent acquisitions

e intensity (tonnes CO

e / £m revenue) including recent acquisitions

Scope 1 & 2 emissions

2,4

tonnes CO

6,800

In 2023/24, the Group commissioned independent external assurance from ERM CVS of its

absolute CO

e emissions from Scope 1 and 2 and Scope 3 categories 1, 4 and 11; emissions

intensity from Scope 1 and 2, product transportation and RS PRO products in-use; and packaging

intensity. Their independent assurance report is set out on pages 68 and 69.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 45

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Packaging

By 2029/30, we want to make our packaging more sustainable: reduce intensity by 30% and 100%

of packaging to be widely reusable or recyclable and made with at least 50% recycled content.

3DFNDJLQJ

intensity

1,2

% packaging made with at least 50%

recycled content

1.57

8% reduction from 2022/23

53%

6 pts increase from 2022/23

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. Packaging intensity is one of

RXUQRQࢉQDQFLDO.3,VDQGLVLQFOXGHGLQRXU

SLL targets (see page 60).

In 2023/24, our packaging intensity reduced

by 8% from 2022/23 and by 35% from 2019/20.

We continued to reduce overall packaging

tonnage by using more reusable eco-totes and

pallets in our internal replenishment systems

and automated packaging machines to produce

PDGHWRࢉWWUDQVLWFDUWRQVWKDWVDYHVSDFHDQG

reduce waste.

Reusable plastic collars were introduced and

plastic pallets were increased for inventory

replenishments between RS locations in

(0($7KLVKDVVLJQLࢉFDQWO\UHGXFHGZDVWH

across the organisation.

:HPDGHVLJQLࢉFDQWSURJUHVVLQVZLWFKLQJWR

more sustainable packaging materials across

our regions this year to support our customers:

– RS in EMEA: we moved to brown packaging

boxes which are made from 100% recycled

material

– RS in Americas: we increased the proportion

of packaging made with over 50% recycled

content from 15% by weight in 2022/23 to

46% in 2023/24

– RS in the UK, France, Italy and Germany: we

replaced plastic tape with paper tape sealing to

reduce plastic consumption by four tonnes and

make it easier for customers to recycle

&RPELQHGWKHVHHࢆRUWVPHDQWKDWRYHURI

total packaging by weight is made from materials

that contain at least 50% recycled content. This

represents a 6 percentage points increase in

recycled content from 2022/23. At the end of

2023/24, 94% of our packaging was reusable

or recyclable, unchanged from 2022/23.

In 2024/25, we will develop the next phase of

our packaging strategy, including our initiatives,

investment plans and a review of our 2030

packaging targets to identify further

opportunities for action.

1. Tonnes / £ million revenue.

.3,VDUHRQDFRQVWDQWH[FKDQJHUDWHVEDVLVDQGDUHXSGDWHGWRUHࢊHFWFKDQJHVLQUHSRUWLQJPHWKRGRORJ\

ESG continued

Recycling and waste

By 2029/30, we want to reduce, reuse and recycle our waste: reduce intensity by 50%, recycle over 95%

DQGDFKLHYH]HURZDVWHWRODQGࢉOOLQRXUGLUHFWRSHUDWLRQV

Waste intensity

1,2

Waste recycled

1.37

increased by 1% from 2022/23

82%

increased by 6 pts from 2022/23

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.

Waste has been a key area of focus for our

distribution site management teams in 2023/24

as we prioritised better waste segregation,

recycling and reuse across our global operations.

Our global DC in Nuneaton, UK implemented a

major continuous improvement project to reduce

supplier and customer packaging and increase

recycling. This led to a 13 percentage point

increase in the site’s recycling rate.

In 2023/24, our waste intensity increased by

1% from 2022/23 but was 10% lower than in the

2019/20 baseline year. The proportion of total

waste recycled increased by 6 percentage points

to 82%. Waste that is not recycled is typically sent

for incineration, energy recovery and only to

ODQGࢉOODVDODVWUHVRUW,QRIRXU

total waste was incinerated, 5% was sent to

ODQGࢉOODQGZDVWUHDWHGYLDRWKHUPHDQV

of disposal.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 46

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Advancing sustainability within our value chain

Product transportation

By 2029/30, we aim to reduce Scope 3 transport emissions by 25% per tonne of product sold.

Scope 3 transport emissions intensity

2,3

1.23

unchanged from 2022/23

With thousands of product shipments every

day, including inbound supplier deliveries and

outbound customer deliveries, it is critical that

we continue to optimise our supply chain to

reduce our transport emissions. In 2023/24, our

transport emissions intensity

was unchanged

from 2022/23, with an overall decrease of 26%

from 2019/20.

Our progress in 2023/24 was impacted by several

factors outside our control, including an increase

in global emissions factors used to calculate our

transport emissions and global supply chain

challenges. This was further compounded by

DVKRUWWHUPLQFUHDVHLQ$VLD3DFLࢉFFXVWRPHU

deliveries by air. Despite these challenges, we

have continued to make positive strides in our

global product transportation strategy to set us

on a positive path for the future.

We continued to prioritise modal shifts from air

to sea and road in 2023/24. We also implemented

several key logistical improvements across our

locations. This included the following activities:

– RS in EMEA: we have expanded the inventory

capacity of our regional DC in Bad Hersfeld,

Germany by 14% in 2023/24 and introduced

new routes into France, Italy and Spain,

resulting in less products being shipped from

the UK into mainland Europe, reducing

emissions and saving transportation costs

– RS in Spain: our expanded FC in Madrid holds

more products locally, reducing delivery

distances and emissions

– 56LQ$VLD3DFLࢉF we expanded our supply

chain network with FCs in Malaysia, Thailand,

the Philippines and New Zealand to reduce the

distance of customer deliveries in these

markets by 9%

– RS in Americas: UK to US product

replenishments moved from air to sea,

reducing transport emissions on these lanes

by 22%

In 2024/25, we will develop the next phase of our

transportation strategy, including our initiatives,

investment plans and a review of 2030 targets.

A key priority will be working with our acquired

businesses to support supply chain optimisation

and seek opportunities to further reduce air

travel, cost and emissions.

ESG continued

Key Scope 3 emissions categories

% Change from

2020 2024 2023 2022

3URGXFWWUDQVSRUWDWLRQ

Product transportation (Scope 3, Category 4)

1,3,5

(18)% 48,400 49,400 54,500

Product transportation carbon intensity

2,3,5

(SBTi target)

(26)% 1.23 1.23 1.29

3XUFKDVHGJRRGVDQGVHUYLFHV

Purchased goods and services (Scope 3, Category 1)

3,5

(12)% 2.9m 2.9m 3.0m

% of suppliers by spend with SBTs

(SBTi target)

+17% pts 32% 25% 19%

,QXVHHPLVVLRQVIURP56352SURGXFWV

Use of sold products: RS PRO

(Scope 3, Category 11)

3,4,5

+4% 2.2m 2.5m 2.3m

RS PRO products in-use carbon intensity

3,4,5

(SBTi target)

(18)% 184 222 203

1. Tonnes of CO

e (from inbound, outbound and inter-site deliveries controlled by RS Group).

2. Transport emissions intensity (tonnes of CO

e from inbound, outbound and inter-site deliveries controlled by RS Group, per tonne

of product sold).

 .3,VXSGDWHGWRUHࢊHFWFKDQJHVLQUHSRUWLQJPHWKRGRORJ\DQGHPLVVLRQVIDFWRUV

4. Tonnes of CO

e from RS PRO products in-use per tonne of product sold.

5. Subject to independent external assurance by ERM CVS. See independent assurance report on pages 68 and 69.

Scope 3 emissions

As a global distributor of industrial product and

service solutions, Scope 3 emissions represent

over 99% of our total carbon footprint. It is

therefore vital that we collaborate with suppliers

DQGFXVWRPHUVWRLQࢊXHQFHUHGXFWLRQVLQERWK

upstream and downstream emissions. In doing

so, we are driving collective climate action and

creating greater value for all our stakeholders.

In 2023/24, emissions from the Group’s three

material Scope 3 emissions categories totalled

some 5.2 million tonnes CO

e. We have set SBTs

for each of these categories which were validated

by the SBTi in 2023/24.

In 2023/24, we worked with third-party experts

WRUHࢉQHRXU6FRSHSURGXFWHPLVVLRQV

methodologies from a spend-based approach

WRDSURGXFWVSHFLࢉFPHWKRGRORJ\WKDWSURYLGHV

greater accuracy. This has resulted in an increase

in our two most material emissions categories

from 2022/23: purchased goods and services

and in-use emissions from RS PRO products

(see table below).

Our reporting methodologies are detailed in our

basis of reporting document, which can be found

at: rsgroup.com/sustainability. Performance

data has been externally assured by ERM CVS

(see pages 68 and 69). Moving forward, we will

continue to mature our Scope 3 data collection,

methodologies and reporting.

In 2024/25, we will focus on in-use emissions

from our wider product portfolio, beyond

RS PRO.

RS Group plc

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

47Annual Report and Accounts for the year ended 31 March 2023

Sustainable products

By 2029/30, we want to develop innovative and sustainable product and service solutions for all our

FXVWRPHUVLQFOXGLQJDQDPELWLRQWRRࢆHURYHU%HWWHU:RUOGSURGXFWVWRFXVWRPHUV

Sustainable products

c. 30,000

products in our Better World product range in 2023/24

Better World products

Better World products enable our customers

to make more sustainable and responsible

purchasing decisions they can trust. Initially

launched in 2022/23 as a range of c. 20,000

products in the UK and Republic of Ireland,

we expanded the range in 2023/24 to include

10,000 new products from 50 additional

suppliers, across 30 countries.

:LWKFXVWRPHUVRIWHQࢉQGLQJVXVWDLQDEOH

purchasing confusing and limited, we launched

DFODLPVEDVHGIUDPHZRUNLQ0DUFKWRRࢆHU

better choices that are backed by clear, credible

DQGYHULࢉHGVXVWDLQDELOLW\FODLPV

Partnering with external consultants to ensure

its robustness, the framework is structured by

product attributes that are aligned to evolving

legislation such as the Green Claims Directive.

The framework also covers key areas of the

product lifecycle, with claims grouped into three

categories based on customer need:

– Made more sustainably: features products

that are produced using more sustainable

materials or manufacturing processes

– Sustainable solution: features products that

help customers run their business more

sustainably; from reducing energy and

emissions to protecting health and safety

– Supports circularity: features products with

an increased lifespan, or that can be reused,

repaired or recycled to reduce waste

Our Better World product range now features

c. 30,000 products from over 90 suppliers and

includes over 1,300 products that support

energy and carbon reduction or renewable

energy generation across customer facilities.

Our ambition is to grow the range to over

100,000 products in the coming years and create

a clear and robust sustainability standard for

our industry that supports both customers and

suppliers. To achieve this ambition, we need

our suppliers to accelerate the development

DQGYHULࢉFDWLRQRIVXVWDLQDEOHSURGXFWVDWD

VLJQLࢉFDQWO\IDVWHUSDFH7KLVLVVRPHWKLQJZH

are strongly advocating for with our supplier

partners, but recognise it will take more time

for the industry to make this fundamental shift

and we have therefore updated our target year

to 2029/30.

The Better World product range also forms

the foundation of our alignment towards the

EU taxonomy for sustainable activities.

As we continue to develop the framework,

we will begin to report key metrics that are

taxonomy-aligned. Our aim is to complete a

taxonomy benchmarking analysis over the next

year in preparation for reporting in 2025/26.

ESG continued

Better World products answer

the clear market need for

moresustainable options.

Theframework helps customers

make the right decisions for

theirown environmental goals.”

Markus Schlink

Corporate Account Manager, Siemens AG

Download the Better World

product guidelines here:

rsgroup.com/sustainability/

advancing-sustainability/

sustainable-products

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 48

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Sustainable service solutions

Sustainability solutions

We want to help our customers run their

EXVLQHVVHVPRUHHࢇFLHQWO\FRVWHࢆHFWLYHO\

safely and sustainably at all stages of the

LQGXVWULDOOLIHF\FOH%\RࢆHULQJYDOXHDGGHGDQG

sustainability-focused industrial MRO services,

we are strengthening customer relationships

and increasing revenue through service fees

and product pull through:

– Maintenance, repair and operations:

:HRࢆHULQGXVWULDO052VROXWLRQVLQFOXGLQJ

energy, water and compressed air leakage

VXUYH\VWKDWSURPRWHRSHUDWLRQDOHࢇFLHQF\

cut costs and reduce emissions

Highlights: In 2023/24, we successfully

launched customer energy and air leak surveys

focused on operational compressed air, heat

loss / steam loss, panel thermography, LED

lighting and pumps. These surveys have been

rolled out to a number of UK and Ireland

customers as part of an initial trial

– Recycling and circular economy solutions:

We are working with established third-party

recycling providers in the UK to provide product

recycling schemes for customers and circular

economy trials

Highlights: In 2023/24, we continued to

develop two new recycling solutions focused on

personal protective equipment (PPE) and cable

recycling. We are actively seeking pilot

customers to develop this further and broaden

RXURࢆHUWRFRYHUERWKUHIXUELVKDQGUHSDLU

– Health and safety (H&S) solutions:

We have partnered with training providers to

create a comprehensive suite of H&S training

courses and customer site surveys including air

TXDOLW\WHVWLQJࢉUHULVNDVVHVVPHQWV+6

DXGLWVDQGKHDOWK\EXLOGLQJFHUWLࢉFDWLRQ

Highlights: In 2023/24, in the UK, we launched

H&S training courses in collaboration with

supplier partners

Supporting low carbon industries

Our product and service solutions support the

growth of low-carbon industries by providing

their product procurement, industrial MRO

and logistics needs. In doing so, RS plays an

important role in enabling the transition to

a low-carbon economy, while creating new

green revenue streams from high value

growth industries:

– Renewables:

We are partnering with the UK renewables

sector to enable fast access to critical MRO

products and solutions which will minimise

their downtime and support growth

Highlights: In 2023/24, we formed a strategic

partnership with energy company Equinor to

SURYLGH052VROXWLRQVWRWKHRࢆVKRUHZLQG

sector in the UK. This collaboration will support

YLWDORࢆVKRUHZLQGSURMHFWVLQFOXGLQJWKH

ZRUOGȆVODUJHVWRࢆVKRUHZLQGSURMHFW'RJJHU

%DQN8.:HDOVRMRLQHG2ࢆVKRUH5HQHZDEOH

Energy (ORE) Catapult and other partners

LQDSURMHFWGHVLJQHGWRSURYLGHRࢆVKRUH

wind operators with vital insight into wind

turbine health, logistical planning and MRO

product solutions

– Electric vehicles and solar:

We provide a range of products for customers

that manufacture, install, operate and maintain

EV charging equipment. We are also increasing

our range of solar power equipment to support

customer sustainability

Highlights: In 2023/24, we enhanced our EV

FKDUJLQJRࢆHULQFUHDVLQJWKHDYDLODELOLW\RI

charging points, cables, connectors and

electronic components. Our aim is to develop

charging kits and bundles to become a

one-stop shop for installers and maintainers

of EV equipment

Supplier engagement

By 2025, we commit to engaging 67%

of suppliers by spend to set SBTs.

Suppliers by spend setting SBTs

32%

7% pts increase from 2022/23

With over 750,000 stocked products from over

VXSSOLHUVDQGDVLJQLࢉFDQWSURSRUWLRQRI

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 making their products and services more

attractive to customers.

We continued to engage with our key suppliers

in 2023/24 to encourage them to develop and

RࢆHUPRUHVXVWDLQDEOHSURGXFWVSULRULWLVH

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. Read page 61 for more.

In 2023/24, 32% of suppliers by spend have set

SBTs with the SBTi, an increase of 7 percentage

points from 2022/23. Despite steady progress,

this means that we are not on track to meet our

2025 ambition of 67%. In 2024/25, we will

continue with our programme of supplier ESG

HQJDJHPHQWWRLQࢊXHQFHIXUWKHUSURJUHVV

ESG continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 49

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

CHAMPIONING

EDUCATION AND

INNOVATION

It is essential that we inspire the next

generation of industrial 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 collaborate

with social impact partners on projects

that improve lives.

ESG continued

2030 ACTIONS PERFORMANCE STATUS COMMENTARY READ MORE

Inspiring future engineers and

innovators:

Reach one million young people

with educational technologies,

learning content and skills

development

796,000

young engineers and students

reached through educational

programmes, products and

DesignSpark platform since 2020/21

Continued to reach young people through our

global education programme which serves

c. 5,200 educational institutions. OKdo’s

participation in the BBC micro:bit – the next

gen campaign also distributed micro:bits to

c. 200,000 primary school students in the UK

See page 51

rsgroup.com/

sustainability

Purpose-driven innovation:

Engage with 1.5 million

engineers and innovators in

creating socially responsible

and sustainable solutions

357,000

engineers and innovators engaged in

purpose-driven innovation initiatives

since 2020/21

Increased engagement with innovators and

engineers by 10% in 2023/24. Our subscription-

based DesignSpark service is set to help

businesses innovate faster, however more work

is needed to reach our 1.5 million target by 2030

See page 51

Social impact partnerships:

Support our social impact

partners to develop solutions

that improve lives – including

supporting TWMP to help

100,000 people in need

31,000

lives improved through TWMP since

2019/20

Raised c. £298,000 for TWMP in 2023/24 through

external fundraising from customers and

suppliers. This will enable TWMP to increase

production and distribution in 2024/25

See page 51

£628,000

raised for TWMP since 2019/20

Status key

Each of our actions are broken down into annual targets that need to be met to remain on

WUDFNWRDFKLHYHRXUDQGJRDOV7KHNH\EHORZUHࢊHFWVRXUFXUUHQWSRVLWLRQ

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

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 50

Our key actions

Inspiring future engineers

and innovators

Purpose-driven

innovation

Social impact

partnerships

By 2029/30 we want to reach one million young people with educational

technologies, learning content and skills development opportunities to

support future engineers and innovators.

By 2029/30 we want to engage with 1.5 million engineers and innovators

in creating socially responsible and sustainable solutions.

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.

We are passionate about inspiring young people, not only by encouraging

them to pursue tech-based careers but by directing their development

towards purpose-led engineering.

As well as providing educational products to c. 5,200 institutions, we are

shaping the next generation of innovators through two key programmes:

– OKdo education provides coding and electronics products, tools and

games to help young students (aged 6-18) learn to code

– RS Grass Roots education gives young engineers and technologists

(aged 18-30) vital skills to inspire and shape their early career

As a purpose-led business at the heart of the global industrial sector, we

are passionate about fostering ingenuity by bringing the engineering

FRPPXQLW\WRJHWKHUWRGHYHORSQHZWHFKWKDWEHQHࢉWVSHRSOHDQGSODQHW

In 2023/24, through our DesignSpark platform, we engaged with a global

community of 1.4 million design engineers, students and innovators from

around the world, to accelerate the design and development of projects

that improve lives. By promoting our #ActivistEngineering ethos, we

HQFRXUDJHHQJLQHHUVWRDGRSWDUHVSRQVLEOHPLQGVHWWRLQࢊXHQFHFKDQJH

To act as a force for good, we support global social impact projects that

develop innovative solutions to solve challenges and save lives.

6LQFHZHKDYHSURYLGHGࢉQDQFLDODQGYROXQWHHULQJVXSSRUWWRWZR

primary partnerships:

– TWMP provides displaced and low-income communities with an

DFFHVVLEOHRࢆJULGZDVKLQJPDFKLQHVROXWLRQWKDWKDVLPSURYHGWKHOLYHV

of 31,000 people to date

– Engineers Without Borders-International (EWB-I) works across the

globe to put sustainability at the heart of engineering

Key actions in 2023/24

OKdo education highlights:

– Participated in the BBC micro:bit – the next gen campaign, an ambitious

project from the BBC, Micro:bit Foundation and Nominet to provide every

primary school in the UK with tools, resources and training to support skills

development in the classroom. As a key partner, OKdo distributed 675,000

micro:bits to reach 90% of UK primary schools (c. 20,000)

– Continued to support the BBC’s annual do your :bit challenge: by donating

eDQGPLFURELWERDUGVWRWKH&RPSWRQ8QLࢉHG6FKRROV'LVWULFW86

RS Grass Roots education highlights:

– RS student project fund provided students with up to £300-worth of RS

products to bring their university projects to life. We also ran Student Project

Competition, EPIC and separate projects in South Africa and Spain

– Provided online learning content to accelerate SuperSkills development and

help engineering students gain important employability skills

Key actions in 2023/24

DesignSpark highlights:

– Promoted the second phase of our Air Quality Project – an initiative that

HQFRXUDJHV'HVLJQ6SDUNPHPEHUVWRXVHDFHUWLࢉHGRSHQVRXUFH

cloud-connected sensor platform (ESDK) to tackle global pollution

– Continued to work with the Maltese government to support air quality

education by implementing our Breathe Better Bear project across ten

schools, with additional schools set to take part over the next year. The

project features a toy bear linked to an ESDK sensor to educate primary

school children on air pollution and climate change

– Launched a new podcast series called Mission Responsible to coincide

with National Engineering Week. The podcast explores how responsible

engineering can build a better planet by exploring topics focused on building

a sustainable future

Key actions in 2023/24

TWMP highlights:

– In 2023/24, we raised c. £298,000 for TWMP Foundation through fundraising

activities, employee donations and matched-giving. Since 2019/20, we have

raised a total of £628,000 for the charity

– 56HPSOR\HHVYROXQWHHUHGWREXLOGࢊDWSDFNZDVKLQJPDFKLQHVZKLFK

were sent to communities in need across India, Kenya and Uganda

– Participated in community wash days near to our regional DC in Fort Worth,

US, where employees volunteered to support the homeless community

EWB-I highlights:

– We sponsored EWB-I’s Engineering for People Design Challenge in the UK

and US, which gives c. 20,000 students the opportunity to design sustainable

solutions that tackle community development challenges

More information

rsgroup.com/sustainability

uk.rs-online.com/web/content/discovery/education

www.okdo.com

More information

rsgroup.com/sustainability

rs-online.com/designspark/home

More information

rsgroup.com/sustainability

www.thewashingmachineproject.org

www.ewb-international.org

ESG continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 51

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

EMPOWERING

OUR PEOPLE

Our unique team of c. 9,000 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 make amazing happen

forabetter world.

2XUFRPPLWPHQWLVWREHࢉUVWFKRLFHIRURXU

people, creating an inclusive and engaging

environment where all our people can grow,

learn and thrive.

ESG continued

2030 ACTIONS PERFORMANCE STATUS COMMENTARY READ MORE

Engaged employees:

Achieve and maintain an

employee engagement score in

the top 10% of high-performing

companies

employee engagement

score (out of 100)

3 point decrease in 2023/24, from 78 to 75. We

KDYHWDNHQDFWLRQWRUHࢉQHRXUVWUDWHJ\YDOXHV

and operating model and enhance our people

plan to support engagement

See page 54

rsgroup.com/

sustainability

Diversity and inclusion (D&I):

(QVXUHRXUWHDPLVUHࢊHFWLYHRI

the customers, suppliers and

communities we serve by working

towards 37% to 42% of our senior

leaders being women and 17% to

22% being ethnically diverse

34%

women in senior leadership roles

We have made some progress towards our D&I

actions to create a more diverse leadership team

in 2023/24. Gender diversity among our leaders

increased by 4 percentage points to 34%, while

ethnic diversity remained unchanged at 11%.

Following a benchmark in 2023/24, we have

VXEVHTXHQWO\UHࢉQHGRXUJOREDO',VWUDWHJ\

and 2030 actions

See pages 54

and 55

11%

ethnically diverse senior leaders

Health, safety and wellbeing:

Aim for zero accidents involving

our people

0.37

8% decrease in our all accident

frequency rate

since 2022/23

Our health and safety performance continued to

improve, with a further all accident frequency

rate reduction in 2023/24. We will continue to

take action to reach zero accidents by 2030

See page 56

Volunteering:

Inspire 50% of colleagues to

volunteer to support their

communities and build new skills

23%

of employees have volunteered

in the last two years

The number of employees using their two days

of paid volunteering leave increased by 5%

points this year. With 23% of our employees

volunteering in the last two years, there is still

work to be done to reach our 2030 ambition

See page 56

Status key

Each of our actions are broken down into annual targets that need to be met to remain on

WUDFNWRDFKLHYHRXUDQGJRDOV7KHNH\EHORZUHࢊHFWVRXUFXUUHQWSRVLWLRQ

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

1. We have updated our 2030 D&I actions in 2023/24. See pages 54 and 55 for more.

2. 102 of 128 senior managers self-reported ethnicity via the employee database (including

QRWVSHFLࢉHGSUHIHUQRWWRVD\DQGLGHQWLࢉHGDVQRQZKLWH

3. Per 200,000 hours worked.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 52

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

D&I, Technology, data and insight

Long-term

objective

Focus areas

Creating an

inclusive and

engaging culture

Building a diverse

talent pipeline

Developing

leader, manager

and functional

capability and

excellence

Compelling

reward and

recognition

that drives

performance

– Employee

engagement

– Values and

behaviours

– Health and safety

–Volunteering

– Talent acquisition

– Employee value

proposition

and onboarding

–Early careers

–Leadership

framework and

development

– People manager

development

– Strategic workforce

planning

– 5HZDUGDQGEHQHࢉWV

– Incentive review

– Recognition

– Wellbeing

Culture Talent Capability Reward

Actions

Underpinned by

…to support our strategy, operating model and vision

2XUYLVLRQIRURXUSHRSOHLVWREHࢉUVW

choice by 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.

In 2023/24, we strengthened our

commitment to people and culture through

the development of our refreshed operating

model, people plan and values launched in

March 2024 (see pages 13, 18 and 19).

/HGE\RXU&KLHI3HRSOH2ࢇFHURXUSHRSOH

plan focuses on four core pillars of culture,

talent, capability and reward. It is guided by

our values and behaviours and underpinned

by two core foundational priorities: D&I to

ensure we are promoting diverse thought

and representation in everything we do and

technology, data and insight to ensure we

have robust tools and data to consistently

meet the needs of all our stakeholders.

7KURXJKRXUSHRSOHSODQZHDUHFRQࢉGHQW

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.

Read about how we are putting our people

ࢉUVWRQSDJHVWR

OUR PEOPLE PLAN

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.

ESG continued

3XWWLQJSHRSOHࢉUVW

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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 53

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

11,000+

comments received in our latest

My Voice engagement survey

Culture

ESG continued

Diversity and inclusion

%\ZHZDQWWRHQVXUHRXUWHDPUHࢊHFWVWKHFXVWRPHUVVXSSOLHUVDQGFRPPXQLWLHVZHVHUYHE\

working towards 37% to 42% senior leaders being women and 17% to 22% being ethnically diverse.

% female leaders % ethnically diverse leaders

34%

Increase of 4 pts from 2022/23

11%

Unchanged from 2022/23

As a global business, it is vital that we create an

inclusive and dynamic environment where all

our people can grow and thrive. By promoting

a culture of openness and respect, we continue

to attract and retain the best talent in our

industry and beyond, while harnessing a diverse

range of strengths relating to gender, ethnicity,

age, neurodiversity, disability and sexuality.

We continued to implement measures to

increase the broad diversity of our senior

leadership team in 2023/24. During the year,

the number of senior leaders that are women

increased to 34% (2022/23: 30%), while the

percentage of our leaders who are ethnically

diverse

was unchanged.

'HVSLWHRXUFRQWLQXHGHࢆRUWVZHKDYHQRW

made progress at the pace we would wish.

To understand why and to help us make a bigger

shift, we conducted an external review of our

',VWUDWHJ\GXULQJWKH\HDU7KLVLGHQWLࢉHG

opportunities to embed D&I more robustly in our

governance, systems and processes and data.

:HKDYHVXEVHTXHQWO\XVHGWKHVHࢉQGLQJVWR

UHࢉQHRXUJOREDO',VWUDWHJ\VWUHQJWKHQRXU

action plan and review our 2030 actions to

ensure they remain ambitious and achievable.

As an outcome, in April 2024, our ExCo agreed

revised 2030 D&I actions to ensure our team

LVUHࢊHFWLYHRIWKHFXVWRPHUVVXSSOLHUVDQG

communities we serve, by working towards 37%

to 42% of our senior leaders being women and

17% to 22% being ethnically diverse.

By introducing a minimum target range to

our actions, we continue to be ambitious

DQGDVSLUDWLRQDOZKLOHFUHDWLQJࢊH[LELOLW\WR

DFFRPPRGDWHVLJQLࢉFDQWUHJLRQDOYDULDWLRQV

and changes in representation across our

global communities and talent pipelines.

Gender

We are committed to promoting gender diversity

across the Group and wider industry to drive our

business and sector forward.

Globally, our Group-wide gender split remains

balanced, with near equal numbers of men and

women across the organisation (2023/24: 49%

female; 51% male). At a senior leadership level,

our female manager population increased by

four percentage points in 2023/24 to 34%

(2022/23: 30%)

At Board level, composition increased to 56%

female Board members (2022/23: 44%), including

our Chair and CFO, following the appointment of

Kate Ringrose. This was recognised in the FTSE

Women Leaders Review for ‘Women on Boards’

in 2024, where we ranked joint fourth for FTSE

100 Board diversity.

3. 102 of 128 senior managers self-reported ethnicity via the

HPSOR\HHGDWDEDVHLQFOXGLQJQRWVSHFLࢉHGSUHIHUQRWWR

VD\DQGLGHQWLࢉHGDVQRQZKLWH

4. The percentage of our manager population which is female

has been subject to independent external assurance by ERM

CVS. See independent assurance report on pages 68 and 69.

Employee engagement

By 2029/30, we want to achieve and maintain an employee engagement score in the top 10% of

high-performing companies.

Engagement score

Down by 3 from 78 in 2022/23

Creating a high-performance, engaged and

motivated team is critical for our long-term

success. To ensure we are meeting the needs

of our people consistently, we regularly check in

with them to assess ongoing levels of satisfaction

and engagement. In 2023/24, our My Voice

survey included 21 questions and was run in

11 languages to gain valuable insights from our

global team. We received an 88% response rate

this year (2022/23: 86%), our highest to date.

We also received more than 11,000 comments

(an increase of 11%), which is testament to the

trust our colleagues have in sharing their views.

Overall, our engagement score declined by three

points in 2023/24, from 78 to 75

. Feedback

highlighted uncertainty surrounding recent

leadership changes, as well as concerns about

global economic conditions. This sentiment was

echoed by external engagement benchmarks,

which saw a general trend in declining

engagement scores globally in 2023

. Our

current score places us four percentage points

below our ambition to be in the top 25% of

high-performing companies by 2024/25.

In response, we continue to invest in our people

plan and identify ways to evolve our listening

approach. From 2024/25, we will conduct

quarterly pulse surveys to encourage managers

to check in with their people more regularly. This

will be further supported by My Voice, which will

provide a global view on Group sentiment every

18 months. We hope that these actions will

strengthen our two-way listening approach and

ensure we continue to meet the needs of our

SHRSOHTXLFNO\DQGHࢆHFWLYHO\

1. As at 31 March 2024, we were four points away from the

global benchmark for the top 25% of high-performing

companies.

2. Glint’s June 2023 Global Benchmark saw a 1% decline

in overall engagement scores since our last survey.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 54

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Diversity and inclusion continued

We continued to implement measures to

support, develop and promote gender diversity

across the Group in 2023/24. Highlights include:

– Elevate: Our women and allies’ network brings

together and supports global members who

are working to bring gender diversity to the

forefront of the agenda

– Accelerating leaders: Continued to support

talented women through accelerator

programmes like Remarkable Women and

Mission Include’s 30% Club which promote

personal and professional development

– Women in Tech: Partnered with Women in

Electronics in the US to invite 32 women into

our workplace and expand employment

opportunities for women in industry

– STEM Returners: Worked with STEM Returners

to recruit, develop, retain and promote women

and other under-represented groups

Ethnicity

We are committed to promoting a diverse culture

UHࢊHFWLYHRIWKHFRPPXQLWLHVDQGFRXQWULHVZH

serve. In support, we are working towards

building a more ethnically diverse leadership

team. In 2023/24, 11% of our senior leaders

LGHQWLࢉHGDVHWKQLFDOO\GLYHUVH

(2022/23: 11%).

To accelerate, we conducted a review of our D&I

strategy, 2030 actions and initiatives in 2023/24.

We will be taking action on this in 2024/25 to

continue to create a more ethnically diverse and

gender balanced team.

While we are behind on our 2030 action, we

continue to raise awareness of ethnic and cultural

diversity across our existing employee base. We

have taken important measures to attract, recruit

and promote talented people of all races and

ethnicities in 2023/24. Highlights include:

– EmbRACE: Our ethnically diverse employee

resource group (ERG) and allies’ network brings

together global members who are working to

recognise and celebrate diversity

– Accelerating diverse leaders: 20 RS employees

joined Mission Include’s 30% Club to help

ESG continued

under-represented groups develop leadership

skills. A further 20 employees participated by

joining the programme as mentors

– Cultural awareness training: Delivered global

training with a focus on cognitive bias and

promoting cultural intelligence

– Celebrating diversity: Continued to celebrate

events including Black History Month in the UK

and US, Windrush (UK) and Juneteenth (US)

Moving forward, ethnicity will remain a key priority

in our refreshed D&I strategy as we look to identify

ways to improve our performance and attract

diverse talent into our industry and organisation.

Broader inclusion

We are committed to operating as an equal

opportunity employer and supporting D&I in its

broadest sense so that everyone is proud and

excited to come to work and can perform at their

best, develop and thrive. We support under-

represented and vulnerable employees by giving

them the tools they need to succeed.

Our employee-led ERGs support colleagues in the

areas of gender (Elevate), ethnicity (EmbRACE),

sexual orientation and LGBTQIA+ (Spectrum) and,

youth (Bloomers). Our ERGs actively run events

throughout the year to raise awareness across the

entire organisation.

We recognise we still have a long way to go, but we

are passionate about investing in our people and

becoming an inclusive employer of choice.

1. 102 of 128 senior managers self-reported ethnicity via the

HPSOR\HHGDWDEDVHLQFOXGLQJQRWVSHFLࢉHGSUHIHUQRWWRVD\

DQGLGHQWLࢉHGDVQRQZKLWH

Our external disclosures relating to Board and

senior management are aligned to the Financial

Conduct Authority’s Diversity and Reporting

requirements (see pages 90 and 91). Read more

about our diversity and inclusion programmes,

policies and progress on our website:

rsgroup.com/sustainability

RS Group plc

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

55Annual Report and Accounts for the year ended 31 March 2024

ESG continued

Volunteering

By 2029/30 we want to inspire 50% of our employees to use their volunteer time to have a positive

impact on global communities.

% of employees who have volunteered in the last two years

23%

Increase of 5% pts from 2022/23

We continued to support local communities

in 2023/24 by encouraging our people to use

their two days of paid volunteering leave to

participate in community-based initiatives and

volunteer for good causes. As well as supporting

local communities, volunteering is a great way to

develop skills, improve engagement and boost

health and wellbeing.

We were pleased to see an increase in

YROXQWHHULQJE\ࢉYHSHUFHQWDJHSRLQWVWKLV\HDU

with employees donating a total of 1,700 days

to support a local cause or one of our key

social impact partners. Key highlights included

volunteering for TWMP, where 110 employees

volunteered their time to build 39 of the latest

Divya 1.65 washing machines and a further

50 volunteers participated in community wash

days to give homeless people the dignity of

clean clothes.

While volunteering participation continues to

increase steadily, we still have work to do to

ensure that 50% of our people are using their

time to support community causes. Volunteering

will be promoted alongside the roll out of our

new values and behaviours in 2024/25 as an

example of how we do the right thing.

For more on our volunteering initiatives and

activities, go to: rsgroup.com/sustainability

Our performance

Change from

2023 2024 2023 2022

All accidents (3)% 32 33 40

All accident frequency rate (per 200,000 hours) (8)% 0.37 0.40 0.53

Lost time accidents (23)% 17 22 23

Lost time accident frequency rate (per 200,000 hours) (30)% 0.19 0.27 0.31

Total calendar days lost (9)% 302 333 252

Near misses reported +20% 20,124 16,740 13,770

Near misses per head +13% 2.21 1.96 1.76

For additional health and safety data, including how we are supporting mental health and wellbeing,

please visit our ESG data centre: rsgroup.com/sustainability

Health, safety and wellbeing

By 2029/30, we aim for zero accidents involving our people.

All accident frequency rate (per 200,000 hours)

0.37

Decrease of 8% from 2022/23

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, prevent avoidable incidents and

support physical health and mental wellbeing.

Following the acquisition of DH, Risoul and

Distrelec, we conducted health and safety audits,

assessments, induction and awareness training

to align the new sites and our colleagues to

Group standards.

We continued to make progress in reducing the

number of total accidents and incidents across

the Group in 2023/24. Our all-accident frequency

rate per 200,000 hours was down 8% to 0.37 – a

reduction of 46% since 2019/20. During the year,

the total number of accidents across the Group

decreased to 32. No accidents resulted in

life-changing injuries or fatalities.

7RSURPRWHDVDIHW\ࢉUVWFXOWXUHZHHQFRXUDJH

our people to have greater awareness and

individual ownership of their actions to protect

themselves, their colleagues and families. We do

this through comprehensive awareness training,

EHVWSUDFWLFHDOLJQPHQWDQGUHJXODUUHࢊHFWLRQ

through our learning from experience process.

In 2023/24, we continued our Behaviour Based

Safety initiative to help employees and leaders

identify and eliminate any behaviours that may

result in future incidents. We also aligned our

GLVWULEXWLRQVLWHVRQࢉYH'&VDIHW\SULRULWLHV

to ensure that key safety requirements are

embedded consistently across our locations.

Near miss reporting continued to underpin

our health and safety focus and we conducted

regular campaigns to encourage our people

to identify and report unsafe acts, hazards

and near misses. The total number of near

misses reported in 2023/24 increased to 20,124.

Once reported, all near misses are investigated

immediately, with most corrected at the time

of reporting and others requiring more

stringent control procedures to be addressed

as soon as viable.

To ensure consistency across our operations, all

our sites have health and safety management

V\VWHPVLQSODFHZLWKVLWHVFHUWLࢉHGWR

ISO 45001 or an equivalent standard, covering

RIࢊRRUDUHDDQGRIRXUVLWHV:H

continue to identify and target sites with higher

accident rates and work with them to develop

action plans which we monitor closely.

13%

increase in reported near misses per head in 2023/24

VLWHVFHUWLࢉHGWR,62RUDQHTXLYDOHQWVWDQGDUG

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 56

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Talent, capability, reward

Talent and leadership

We operate in a competitive industry, which is

why we place strong emphasis on accelerating

the long-term growth and career advancement

of our people and leaders to retain talent and

drive our commercial success.

In 2023/24, we continued to increase our insight

and rigour into the selection and development

of our leadership population. To achieve this, we

introduced a Global Executive Talent Policy which

GHࢉQHVRXUFRPPRQDSSURDFKWRDVVHVVLQJ

internal and external leadership hires while

balancing leadership behaviours with technical

capabilities. In 2024/25, we will include leadership

succession tracking into our QBRs to embed

further talent planning, visibility and accountability.

As part of our talent review process, we regularly

identify and nominate future leaders to

participate in development activities that are

best aligned to their needs. In 2023/24, we

enrolled select candidates in strategic learning

opportunities such as Ezra Coaching and

Capability development

Our people are integral to creating a high-

performance culture that unlocks the

innovation and ingenuity we need to deliver our

VWUDWHJ\DQGWRUHPDLQࢉUVWFKRLFHIRUDOORXU

stakeholders. By setting a consistent global

framework for learning and development, we

are shaping the talent we need to thrive.

We invest in our people through a broad mix

of on-the-job activities, learning opportunities

and formal training. In 2023/24, our employees

completed a total of over 51,000 hours of

learning through our global learning platform,

My Academy, on both mandatory and non-

mandatory content. This is supplemented by

live training which provides over 30,000

additional training hours.

Our approach to ensuring we have the right

capabilities in place is driven by two key global

processes: talking performance and talent &

succession reviews. By promoting a regular

rhythm of career conversations between

managers and employees, we can identify

GHYHORSPHQWDOQHHGVTXLFNO\DQGHࢆHFWLYHO\

to accelerate their progression.

In 2023/24, we introduced a new people

managers’ guidebook to support our managers

with everything they need to positively engage,

develop and manage their people. The

guidebook includes guidance in facilitating

excellent career and development

conversations to support skills development

and career progression.

We also relaunched our monthly Management

Matters sessions in 2023/24 to bring people

managers from all roles and regions together

to share experiences and learning.

Reward and recognition

We want to provide competitive rewards and

EHQHࢉWVWRLQFHQWLYLVHRXUSHRSOHWRSHUIRUP

at their best and to attract and retain top talent.

In 2023/24, we enhanced our rewards and

EHQHࢉWVWRSURYLGHDSDFNDJHRISK\VLFDOVRFLDO

DQGࢉQDQFLDOLQFHQWLYHVIRURXUSHRSOHDQGWKHLU

families (see pages 103 and 104).

Our approach is guided by our global

commitment to ensuring base pay levels

DUHVHWWRSD\DOLYLQJZDJHDQGWKDWZHRࢆHU

competitive bonuses to our people, as well

as long term incentive plans (LTIPs) to reward

our senior leaders. This is supported by

a market-based approach that aligns our

EHQHࢉWVDQGUHZDUGVSDFNDJHVWRORFDO

market norms and supports our commitment

to diversity and inclusion.

,QࢊXHQFHZLWK,PSDFW:HDOVRFRQWLQXHGWR

encourage peer-to-peer interaction via monthly

Management Matters facilitated sessions and

our 2024 Leadership Event, which was attended

by 193 people managers in March 2024.

We are also passionate about identifying and

investing in emerging talent to accelerate their

progression into leadership roles. Through

Future Shapers, we are helping ambitious

cohorts of employees to develop their

leadership skills. Led by Ivy House, 14 employees

participated in Future Shapers this year, with

a total cohort of 71 employees since the

programme began in 2019/20.

We continue to provide apprenticeships and

supported 253 colleagues in the UK in 2023/24.

We have been recognised as a Gold member of

the 5% Club and our employees have spent over

11,000 hours developing their knowledge, skills

and behaviours through ‘earn and learn’ training.

ESG continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 57

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

DOING BUSINESS

RESPONSIBLY

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 the more than 750,000

products we stock come from responsible

businesses that share our high ethical and

environmental standards.

ESG continued

2030 ACTIONS PERFORMANCE STATUS COMMENTARY READ MORE

Responsible business:

ESG-related targets included in

our employee rewards

programme across all levels,

geographies and in our SLL

45%

of employees had their annual

incentive aligned to Group carbon

reduction in 2023/24

45% were incentivised to deliver Scope 1 and 2

emissions reduction goals in 2023/24, with a

carbon metric accounting for between 10% to

15% in the Group’s annual incentive. Three ESG

metrics are in our £400 million SLL

See page 60

rsgroup.com/

sustainability

Responsible supply chain:

Evaluate our suppliers against our

high ethical and environmental

standards and set ESG objectives

for strategic suppliers

59%

of suppliers by spend with signed

Ethical Trading Declaration

We continue to drive ESG action with our

strategic product and service suppliers across

(0($DQG56,QWHJUDWHG6XSSO\6SHFLࢉFDOO\ZH

target our key suppliers (top 67% by spend) by

encouraging them to work on four ESG priorities

set out in our Supplier ESG Handbook. By

including supplier spend from recent

acquisitions, the number of suppliers in the top

67% by spend has increased from c. 350

businesses to 390. This has impacted the

percentage of suppliers with a signed Ethical

Trading Declaration and an EcoVadis assessment

in 2023/24. We will continue to work with the

acquisitions in 2024/25 to align to our supply

chain ambitions

See page 61

52%

of suppliers by spend have an

EcoVadis rating

66%

of RS PRO suppliers by spend

are Sedex members

Status key

Each of our actions are broken down into annual targets that need to be met to remain on

WUDFNWRDFKLHYHRXUDQGJRDOV7KHNH\EHORZUHࢊHFWVRXUFXUUHQWSRVLWLRQ

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

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 58

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

ESG governance

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 continued

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 all ESG-related

policies, goals, initiatives, investments and

disclosures. The ExCo receives quarterly ESG

performance updates and annual training on our

net zero strategy and climate transition plans to

ensure they are taking action on the Group’s key

climate-related risks and opportunities, the latest

regulations and embedding best practice.

The Board has close oversight of our ESG action

plan. They ratify key ESG policies, targets,

initiatives and investments, while monitoring

progress via regular ESG updates. In respect of

ESG, the Board is supported by two of its

committees: the Audit Committee (see pages 92

to 98), who ensure alignment to existing and

emerging ESG compliance and the Remuneration

strategic plans, oversee initiatives and manage

ongoing performance. The ESG team are also

supported by the ESG compliance steering group

who oversees the development and delivery of the

Group’s approach to existing and emerging ESG

legislation, including the TCFD and CSRD.

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 2023/24 ESG Report and data

FHQWUHLQFOXGHVXSWRࢉYH\HDUVRIHQYLURQPHQWDO

data and our climate-related KPIs. We also provide

a separate 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 68 and 69. For more, please go

to: rsgroup.com/sustainability.

Our ESG disclosures are aligned to the following

frameworks and standards:

– TCFD: In 2023/24, we enhanced our TCFD

GLVFORVXUHZLWKࢉQDQFLDOPRGHOOLQJDQGUHࢉQHG

our Scope 3 emissions methodology, disclosure

and assurance process (see pages 62 to 67)

– GRI & SASB: Our ESG reporting aligns to the

Global Reporting Initiative (GRI) and sector-

VSHFLࢉFUHFRPPHQGDWLRQVRI6XVWDLQDELOLW\

Accounting Standards Board (SASB)

– UNGC: We are members of the United Nation’s

Global Compact (UNGC), and our latest

Communication on Progress (COP) can be found

on our website

– UN SDGs: Our ESG action plan is aligned to six

of the UN SDGs where we can make the biggest

impact (see page 41)

The ESG regulatory landscape continues to evolve

rapidly and we are working hard to stay aligned

ZLWKWKHODWHVWVWDQGDUGVDQGVHFWRUVSHFLࢉF

recommendations. This includes taking measures

to align our approach to emerging UK and EU

regulation, including CSRD, the International

Sustainability Standards Board (ISSB), UK

Transition Plan Taskforce (TPT) and the EU and

UK Green Taxonomies.

Committee (see pages 99 to 115), who make

decisions on ESG metrics and targets to be

included in executive remuneration and employee

rewards.

In 2023/24, the Audit Committee reviewed the

Group’s climate-scenario modelling and wider

TCFD disclosure, as well as our updated Scope 3

emissions modelling and recommended these to

the Board for disclosure (see page 80). We also

selected a new Non-Executive Director ESG lead,

Bessie Lee, to provide a deeper governance link

between the Board, ExCo and ESG team.

The Group ESG team is responsible for the

day-to-day delivery of our ESG action plan.

Operating within our Corporate Services function,

the team is led by our VP of Social Responsibility

& Sustainability and is supported by four cross

organisational steering groups focused on net

zero, packaging, transport and Better World

products. These teams meet monthly to develop

We continued to align to leading global ESG

ratings in 2023/24, including:

– EcoVadis: Platinum medal

– CDP: A- Climate score

– MSCI: AA rating

– Sustainalytics: 6.4 score (Global top 50

ESG companies)

– S&P: Sustainability Yearbook inclusion

Ethics and compliance

We are committed to upholding the highest

standards of ethics and compliance across the

Group and ask our suppliers and partners to do

the same. To ensure consistent action, our key

policies and processes align to regional legislative

requirements and best practice standards. These

include the policies and processes described

below and on page 60.

Code of Conduct

In 2023/24, we launched a new Code of Conduct

to reinforce our commitment to achieving the

highest ethical and legal standards across the

Group. The Code of Conduct sets out our policy

to maintain the highest standards of ethical

conduct and behaviour, legal and compliance

requirements we must adhere to and ways

of raising concerns via our Speak Up helpline

(see page 60).

To familiarise people with the Code of Conduct,

we launched mandatory training in early 2024

which 100% of our top 500 leaders and 91% of

employees have completed to date, with ongoing

training to cover remaining employees.

Awards and recognition

In 2023/24, RS Group was awarded Best

Company for Sustainability Reporting in the

industrial sector at the Corporate ESG Awards

2023, held by ESG Investing. We were also listed

in the S&P Global Sustainability Yearbook for

WKHࢉUVWWLPHSODFLQJXVLQWKHWRSRI

companies in our industry for ESG action.

ESG GOVERNANCE STRUCTURE

The Board

Oversees the Group’s ESG approach and receives

regular updates on ESG action plan progress

Executive Committee

Develops and implements the Group’s ESG strategy,

policies and delivery initiatives

ESG team

Ensures operational delivery of the Group’s ESG action plan

ESG Non-Executive Director

Risk Committee

Audit Committee

Remuneration Committee

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 59

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

ESG governance continued

ESG 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

% of employees with carbon reduction

metric in annual incentive

unchanged from 2022/23

45%

a 5% pts decrease from 2022/23

We have taken steps to integrate ESG targets

into our employee rewards programme to drive

progress towards our 2030 ESG action plan. As

of 2023/24, 45% 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% to 15% of the Group

annual incentive. In 2023/24, we exceeded the

maximum performance level for this metric.

Furthermore, 75 of our senior leaders continue

to participate in the Journey to Greatness LTIP,

which has employee engagement as a measure.

In addition to these incentives, ESG forms a core

part of our performance management at both a

Group and individual level. The ExCo and Board

receive ESG performance updates quarterly. We

DOVRKDYHHLJKWQRQࢉQDQFLDO.3,VLQRXUXSGDWHG

Group performance scorecard which the ExCo

will use to manage ESG performance via QBRs

ZLWKWKHUHJLRQVDQGIXQFWLRQV6SHFLࢉF

individuals and teams have ESG targets in their

annual objectives and annual incentive structures

to drive further progress.

Sustainability-linked loan

The Group continues to have access to funding

via a £400 million SLL facility which is directly

linked to the achievement of three of the Group’s

most material 2030 ESG actions – direct carbon

emissions (Scope 1 and 2 CO

e emissions),

packaging intensity and the percentage of

management that are women. In 2023/24,

we met the annual performance targets

IRUDOOWKUHH.3,VDVVSHFLࢉHGLQWKH6//

framework agreement.

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

products and service suppliers to sign our

Ethical Trading Declaration, or provide their

own equivalent ethical policy that aligns to our

standards. As of 2023/24, 59% 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

DࢆDLUVHWKLFDOO\DQGWUDQVSDUHQWO\HQVXULQJZH

do not engage in or facilitate any forms of bribery

or corruption as outlined in UNGC Principle 10.

Our Anti-Bribery & Corruption Policy covers

our stance on bribes, gifts and hospitality,

facilitation payments and political and charitable

contributions. This policy and expected

procedures are detailed in our Code of Conduct

training which all employees are required to

complete. We delivered anti-bribery training

to 100% of our top 500 leaders in 2023/24.

Whistleblowing

Speak Up, our dedicated whistleblowing process

LVDFRQࢉGHQWLDOPHWKRGIRUHPSOR\HHV

customers and suppliers to raise concerns

regarding ethical or legal concerns without fear

of victimisation. Available globally, we provide

both an internal channel and an external

independent reporting service that is operated

by a third party supplier.

In 2023/24, we received 23 Speak Up reports, all

of which were investigated and where necessary

acted upon. The operation of our Speak Up

process is monitored regularly by our Audit

Committee (see page 98). We refreshed our

Speak Up Policy during the year and continued

to deliver dedicated training, awareness and

Speak Up refresher campaigns.

Modern slavery

Our 2024 Modern Slavery Transparency

Statement outlines our zero-tolerance stance

WRZDUGVDQ\IRUPVRIVODYHU\KXPDQWUDࢇFNLQJ

child or forced labour within any part of our

business or supply chain. This position is

reinforced in our Anti-Slavery and Human

7UDࢇFNLQJ3ROLF\DQG(WKLFDO7UDGLQJ3ROLF\

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 2023/24,

91% of our employees undertook modern slavery

training as part of our Code of Conduct training,

including employees across all DCs.

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 NIST 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 high level of 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.

In 2023/24, we brought all our mandatory

information security and privacy training

requirements into a single course that forms part

of our Code of Conduct training. In addition, we

provided tailored training to over 600 colleagues

across the Group (100% of high risk teams) that

deal with personal data from the UK and EU.

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 for the year ended 31 March 2024 60

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

ESG continued

Supplier ESG action plan

We are committed to leveraging our position

at the centre of the global industrial value chain

to drive responsible action among our suppliers,

on behalf of our customers. We recognise that

sustainability is a new part of the journey for

some of our suppliers, which is why we are

committed to educating, upskilling and

encouraging them to set responsible business

standards that align with our own. In doing so,

we are forging stronger relationships and

accelerating value chain decarbonisation.

We continued to strengthen our approach

towards screening and collaborating with

suppliers in 2023/24, which helps to reduce risk

and increase trust among customers. We target

to engage our top 67% of suppliers by spend

(c. 390 suppliers) and all RS PRO suppliers on

four ESG priorities outlined in our Supplier

ESG Handbook:

– Sign and return the Ethical Trading

Declaration: 59% of suppliers by spend with

a signed Ethical Trading Declaration in place

in 2023/24 (2022/23: 50%

)

Finally, 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: As of 2023/24, we have risk

screened all existing suppliers on the RS

database against global government lists

– 6XSSOLHUSUHTXDOLࢉFDWLRQTXHVWLRQQDLUHV

Since May 2023, all new suppliers are required

WRFRPSOHWHDPDQGDWRU\SUHTXDOLࢉFDWLRQ

questionnaire as part of our supplier

onboarding process. In 2023/24, we updated

WKHTXHVWLRQQDLUHDQGWULDOOHGDUHTXDOLࢉFDWLRQ

supplier ESG questionnaire for our top

suppliers, covering 67% of supplier spend. We

will aim to re-qualify our suppliers every three

years to ensure they are all aligned to evolving

and emerging standards

– RS PRO site inspections: 39 audits of higher-

risk RS PRO suppliers from Asia took place

in 2023/24

More information on our supplier ESG action

plan can be found online at: rsgroup.com/

sustainability

– 'HYHORSDQGRࢆHUPRUHVXVWDLQDEOHSURGXFWV

(QJDJHGVXSSOLHUVWRGHYHORSDQGRࢆHUPRUH

sustainable products via ongoing webinars and

individual meetings. 50 new suppliers and 10,000

new products were added to the Better World

product range in 2023/24, which now totals

c. 30,000 products from over 90 suppliers

(see page 48)

– Set science-based carbon reduction targets by

2025: As of 2023/24, 32% of suppliers have set

science-based climate goals through the SBTi

(see page 49)

– Become EcoVadis-rated or Sedex members:

Continued to encourage strategic suppliers to

become EcoVadis rated, with 52% by spend now

rated (2022/23: 49%

). Not only has participation

increased, but overall scores have also improved

from an average bronze medal in 2022/23 to

silver in 2023/24. Additionally, we encourage

RS PRO suppliers to become Sedex members,

with 66% of our key suppliers now signed up

(2022/23: 49%)

Beyond this, we continued to engage suppliers on

key ESG topics throughout the year via webinars

and events covering topics such as EcoVadis

alignment, sustainable PPE, health and safety and

Better World product development.

1. Restatement of 2022/23 from 52% to 50% due to updates in reporting methodology and data cleansing.

2. Restatement of 2022/23 from 50% to 49% due to updates in reporting methodology and data cleansing.

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 trading declaration

Suppliers with

EcoVadis rating

Suppliers

committed to SBTi

RS PRO suppliers that are

Sedex members

59%

9 pts

increase from 2022/23

52%

3% pts increase

from 2022/23

32%

7 pts increase from 2022/23

66%

17 pts increase from 2022/23

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 61

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

ESG continued

TASK FORCE ON

CLIMATE-RELATED

FINANCIAL DISCLOSURES

At the time of publication, we have aligned with the requirements of Listing Rule 9.8.6R

and the Companies (Strategic Report) (Climate-related Financial Disclosure) Regulations 2022

E\LQFOXGLQJFOLPDWHUHODWHGࢉQDQFLDOGLVFORVXUHVWKDWDUHFRQVLVWHQWZLWKWKH7&)'

recommendations.

:KHUHSRVVLEOHZHKDYHPDGHXVHRIWKH7&)')LQDO5HFRPPHQGDWLRQV5HSRUWDQG$QQH[HV

DQGWHFKQLFDOVXSSOHPHQWVIRURXUTXDQWLWDWLYHFOLPDWHVFHQDULRDQDO\VLV:HZLOO

continue to use these resources to strengthen our disclosures in the future, including

GHYHORSPHQWRIRXUࢉUVWFOLPDWHWUDQVLWLRQSODQ

The table below sets out the 11 TCFD recommendations and where the related information can be found within this report:

Recommendation Disclosure Reference

Governance

A) Describe the Board’s oversight of climate-related risks and opportunities Doing business responsibly (page 59)

B) Management’s role in assessing and managing climate-related risks and opportunities Doing business responsibly (page 59)

Strategy

$'HVFULEHWKHFOLPDWHUHODWHGULVNVDQGRSSRUWXQLWLHVWKHRUJDQLVDWLRQKDVLGHQWLࢉHGRYHU

the short, medium and long term

TCFD strategy (pages 63 to 67)

B) Describe the impact of climate-related risks and opportunities on the organisation’s

EXVLQHVVHVVWUDWHJ\DQGࢉQDQFLDOSODQQLQJ

TCFD strategy (pages 63 to 67)

&'HVFULEHWKHUHVLOLHQFHRIWKHRUJDQLVDWLRQȆVVWUDWHJ\WDNLQJLQWRFRQVLGHUDWLRQGLࢆHUHQW

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

TCFD strategy (pages 63 to 67)

Risk

management

A) Describe the organisation’s processes for identifying and assessing climate-related risks TCFD risk management (page 67) / Risks,

viability and going concern (page 36)

B) Describe the organisation’s processes for managing climate-related risks TCFD risk management (page 67) / Risks,

viability and going concern (page 36)

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 67) / Risks,

viability and going concern (page 36)

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 / TCFD metrics

and targets (page 67)

B) Disclose Scope 1, Scope 2 and if appropriate Scope 3 greenhouse gas (GHG) emissions

and the related risks

Advancing sustainability (pages 44, 45

and 47)

C) Describe the targets used by the organisation to manage climate-related risks and

opportunities and performance against targets

Advancing sustainability (pages 42 and

43)

Climate change is one of the greatest challenges

facing our world today. As a Group, we are

committed to climate action and supporting the

critical priorities of the Paris Agreement to limit

global warming to 1.5°C above pre-industrial

levels. 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 transparently. This is

the third year we have published a TCFD report

and we have made good progress in this time,

moving from qualitative to quantitative scenario

DQDO\VLVIRURXUࢉYHFOLPDWHUHODWHGULVNVDQG

opportunities (CRROs), embedding strong

governance and risk management controls and

integrating climate and ESG priorities into our

products, solutions, target customer industries

and operational capabilities. Our progress to date

enables us to mitigate our risks, while leveraging

the opportunities to deliver long-term value for

our stakeholders by supporting the transition to

a low-carbon global industrial sector.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 62

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

ESG continued

2XUࢉYH&552VDUHVXPPDULVHGLQWKHWDEOHRQ

this page and further detail can be found on

pages 64 and 65. 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 2023/24,

inclusive of climate risks and opportunities, refer

to page 59. For an update on key ExCo and Board

climate-related engagement and activities in

2023/24, please refer to pages 80 to 83.

Strategy

Driving climate action through our core

business strategy

Climate action is core to our purpose, strategy,

YDOXHVDQG(6*DFWLRQSODQ:HUHࢉQHGRXU

strategy in 2023/24 and this has provided an

opportunity to deepen this integration further.

Some key examples of how we are mitigating

climate risks and maximising opportunities,

aligned to our strategy include:

– Customers: developing and retaining customers

in industry sectors that are critical to the

low-carbon transition, including renewables,

utilities and automotive sectors (see page 14)

– Products: RࢆHULQJRXUFXVWRPHUVPRUH

sustainable products that help them to reduce

their energy consumption and transition to

lower-carbon operations (see pages 15 and 48)

– Solutions: helping our customers run their

businesses more sustainably, via solutions such

as energy monitoring and product recycling

(see pages 15 and 49)

– 2SHUDWLRQDOH[FHOOHQFH reducing emissions

from our DC operations and product shipments

(see pages 16 and 42 to 47)

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 48 and 49). We are already seeing

our commitment and progress on ESG be a key

GLࢆHUHQWLDWRULQDWWUDFWLQJDQGUHWDLQLQJKLJKYDOXH

customers. Alongside this, we are making good

progress in developing our climate transition

plan, utilising the TPT Framework released in

2023 and will publish this in line with developing

compliance timelines.

Refining our approach to climate scenario analysis

In 2023/24, we refreshed our quantitative climate

VFHQDULRDQDO\VLV2XU(6*DQG*URXSࢉQDQFLDO

control teams worked together to overlay climate

VFHQDULRVRQWRRXUUHIUHVKHGࢉYH\HDUVWUDWHJLF

plan and projected out to 2050. This has helped

to bring tighter ownership and control over our

CRROs and demonstrates our commitment to

embedding climate action across our business.

We have modelled the impact on Group adjusted

RSHUDWLQJSURࢉWDIWHUPLWLJDWLRQRIWKH&552V

XQGHUWKUHHGLࢆHUHQWFOLPDWHVFHQDULRVIURPWKH

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 66).

:HLGHQWLࢉHGWKHOLNHO\WLPHIUDPHIRUHDFK&552

to emerge:

– Short term: 0 to 5 yearsDOLJQHGWRRXUࢉYH\HDU

strategic plan)

– 0HGLXPWHUPWR\HDUV (aligned to the risk

management process, modelled as 2030 in our

quantitative climate scenario analysis)

– /RQJWHUPWR\HDUV (aligned to the risk

management process, modelled as 2050 in our

quantitative climate scenario analysis)

:KLOVWZHKDYHLGHQWLࢉHGVKRUWWHUPFOLPDWH

RSSRUWXQLWLHVZHKDYHQRWLGHQWLࢉHGDQ\PDWHULDO

short-term risks. We have modelled our medium

and long-term CRROs in the table on page 66.

2XUࢉYH&552V

Products, solutions and customers

&KDQJHVLQFXVWRPHU

segments and product

demand (transition

opportunity)

Logistics

7HFKQRORJ\WUDQVLWLRQ

and rising fuel costs

(transition risk)

Distribution sites

5HGXFHGHPLVVLRQVDQG

energy costs through solar

generation (transition

opportunity)

,PSDFWRIH[WUHPHKHDW

(physical risk)

,PSDFWRIH[WUHPHZHDWKHU

(physical risk)

We are already seeing our commitment and progress

onESG be a key differentiator in attracting and retaining

high-value customers

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 63

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

DFWLRQVRQRXU&552V

&552 Description Business owners Metrics monitored

2023/24 initiatives, progress and

investment activities

7UDQVLWLRQ

Opportunity

3URGXFWVVROXWLRQVDQG

customers: Changes

in customer segments

and product demand

6WUDWHJLFDFWLRQDOLJQPHQW

&RQQHFWHGVWDNHKROGHUV

Growth in customer segments linked to the

low-carbon economy and product categories

that enable the net zero transition, alongside

a smaller downside of decline in traditional

customer segments (fossil fuel) and products

that are not required in the low-carbon

economy (although modelling indicates this is

RIORZVLJQLࢉFDQFH

Products: Chief

of Product and

Supply Chain

(P&SC)

Solutions: Chief

of Solutions and

Services

– Number of products in the Better World product

range (ambition for 100,000)

– 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 UK Green Taxonomy guidance

– Better World products – c. 30,000 products launched

in 30 countries (see page 48)

– Low-carbon industry sectors – business development

WHDPDQGVWUDWHJ\HVWDEOLVKHGIRU8.RࢆVKRUHZLQG

industry. Key strategic MRO partnership established

ZLWK(TXLQRUWRVHUYHWKHZRUOGȆVODUJHVWRࢆVKRUHZLQG

farm – Dogger Bank, UK (see page 49)

– New sustainability solutions to help customers monitor

and reduce energy in their operations (see page 49)

2024/25 focus: Continue to grow our customer

propositions and revenue from sustainable product

and service solutions and low-carbon industries

Risk

2. Logistics: Technology

transition and rising

fuel costs

6WUDWHJLFDFWLRQDOLJQPHQW

&RQQHFWHGVWDNHKROGHUV

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)

–Total CO

emissions and emissions intensity for

product transportation – 25% reduction per

tonne of product sold by 2029/30 from 2019/20

(SBTi target)

– Logistics costs as a % of revenue

– 26% reduction in absolute carbon emissions from

product transportation since 2019/2020

, delivered

via ongoing initiatives to regionalise and optimise our

supply chain and switch transport modes to sea or

ground to limit distance, air miles, costs and carbon

emissions (see page 47)

2024/25 focus: Continued supply chain optimisation

through regional sourcing, storing and shipping and

modal shift to reduce distances travelled, carbon

footprint and cost

Opportunity

'LVWULEXWLRQVLWHV

Reduced emissions

and energy costs through

solar generation

6WUDWHJLFDFWLRQDOLJQPHQW

&RQQHFWHGVWDNHKROGHUV

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 95

– Reduction in energy costs

– Percentage of 2023/24 electricity use from on-site

solar generation: 2%

– Investing in solar panels at our distribution sites or

leasing new distribution sites with solar installed

– 52kW solar panels array added to our FC at Midrand,

South Africa

– New leased FC in Madrid, Spain, with solar panels

installed

– Proposals in development for other key distribution

sites (see page 43)

2024/25 focus: Review and progress proposals

for installation of solar generation at further sites

1. Scope 3 emissions from product transportation (Category 4) per tonne of product sold.

ESG continued

Stakeholder key

Our people Customers Suppliers Communities Shareholders

Strategic action

Customers Products Solutions Experience Operational excellence

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 64

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

DFWLRQVRQRXU&552V

&552 Description Business owners Metrics monitored

2023/24 initiatives, progress and

investment activities

Physical

Risk

4. Distribution sites:

Impact of extreme heat

6WUDWHJLFDFWLRQDOLJQPHQW

&RQQHFWHGVWDNHKROGHUV

Increased costs associated with installation

RIKLJKHࢇFLHQF\FRROLQJV\VWHPVDQGRU

potential impacts on the health, safety

and wellbeing of people working at our

distribution sites which could reduce

SURGXFWLYLW\.H\PDWHULDOVLWHLGHQWLࢉHG

to be exposed to extreme heat is our

regional distribution site 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 95

– Employee productivity monitored in distribution

sites during high-heat periods with regular breaks

and refreshments

– Building upgrades and new building management

system installed at our regional DC in Fort Worth,

US, supporting HVAC optimisation (c. £0.5 million

capital investment)

– 1HZPRGHUQDQGHQHUJ\HࢇFLHQW)&LQ0DGULG6SDLQ

and improvement in roof insulation and windows at our

regional Beauvais DC, France, to reduce solar

gain (c. £1 million capital investment)

2024/25 focus: Ongoing mitigation through business

continuity planning, review additional sites for HVAC

and fabric improvement options

Risk

5. Distribution sites:

Impact of extreme weather

6WUDWHJLFDFWLRQDOLJQPHQW

&RQQHFWHGVWDNHKROGHUV

([WUHPHZHDWKHUHYHQWVLQFOXGLQJࢊRRGLQJ

storms and tornadoes, have the potential to

disrupt our operations and logistics and cause

physical damage to our infrastructure. Our

regional distribution sites in Fort Worth, US

ZDVLGHQWLࢉHGWREHWKHNH\VLWHDWULVNGXHWR

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

– Proactive 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

2024/25 focus: Ongoing mitigation through business

continuity planning

ESG continued

Stakeholder key

Our people Customers Suppliers Communities Shareholders

Strategic action

Customers Products Solutions Experience Operational excellence

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 65

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

ESG continued

Updated climate scenario analysis

,QRXU(6*DQG*URXSࢉQDQFLDOFRQWURO

teams conducted quantitative climate scenario

analysis, overlaying the CRROs onto our refreshed

ࢉYH\HDUVWUDWHJLFSODQ+LJKOHYHOUHVXOWVRIWKH

analysis are shown in the table on the right, with

WKHUHVLGXDOࢉQDQFLDOLPSDFWRI&552VSRVW

mitigation. Opportunities indicate a positive net

LPSDFWRQRSHUDWLQJSURࢉWVKDGHGJUHHQDQG

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

VFHQDULRVGXHWRIDVWHUDQGPRUHVLJQLࢉFDQW

policy and market changes to deliver the

low-carbon transition.

The main update to our analysis, compared to

2022/23, is that we have reassessed the physical

risk from extreme weather on our DC in Fort

Worth, US, to be ‘Very Low’ (post mitigation) under

RCP 8.5 scenario (>4

C) compared to previously

assessing it to be ‘Low’. We conducted a more

detailed, externally-facilitated recovery assessment

that increased the speed and magnitude of the

mitigating activities, which we have included in our

analysis. We have also re-categorised our product

demand CRRO as an opportunity (previously

reported as an opportunity and a risk), as our

updated analysis indicates that the downside risk

of lost revenue is minimal. Our exposure to the

fossil fuel sector is very low, relative to the potential

opportunity to expand and further develop our

sustainable product and service solutions and

support low-carbon industries.

)RUIXUWKHUGHWDLORQRXUTXDQWLWDWLYHࢉQDQFLDO

scenario analysis methods, please refer to

our basis of reporting document at:

rsgroup.com/sustainability

&552 Financial impact Timeframe

Annual net impact on Group

DGMXVWHGRSHUDWLQJSURࢉW

)LQDQFLDOPDWHULDOLW\NH\

Transition Temperature rise 1.5°C 2°C >2°C

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

RࢆVHWWKURXJKHPEHGGLQJLQ

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 2°C >2°C >4°C

4. Risk Distribution sites: impact

RIH[WUHPHKHDW

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

RIH[WUHPHZHDWKHU

Annual revenue impact and

RSHUDWLQJFRVWRࢆVHWE\

recovery via insurance policies

2030 No impact Very Low Very Low

2050 No impact Very Low Very Low

)LQDQFLDOPDWHULDOLW\NH\

$QQXDOLPSDFWRQ*URXSDGMXVWHGRSHUDWLQJSURࢉW

Very high >32%

High 24 to 32%

Medium 16 to 24%

Low 8 to 16%

Very low 0 to 8%

No impact 0%

Temperature scenarios

Temperature Scenario

Transition

1.5°C NZE – 1.4°C

2°C APS – 2.1°C

>2°C STEPS – 2.6°C

Temperature Scenario

Physical

2°C RCP 2.6 – 2.0°C

>2°C RCP 4.5 – 2.4°C

>4°C RCP8.5 – 4.3°C

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 63.

 $OLJQHGWR56HQWHUSULVHULVNPDQDJHPHQWJXLGDQFHD&552LVFRQVLGHUHGWREHPDWHULDOZKHUHWKHDQQXDOQHWLPSDFWRQDGMXVWHGRSHUDWLQJSURࢉWLVJUHDWHUWKDQ&5523URGXFWVVROXWLRQVDQG

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).

1HWࢉQDQFLDOLPSDFW

Overall, we have low exposure to physical climate

risks, with our operations generally in low-risk

ORFDWLRQV)XUWKHUPRUHRXUGLYHUVLࢉHGEXVLQHVV

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 are able to deliver upon

our strategic growth ambitions relating to low-carbon

products, service solutions and industry sectors, we

ZLOOVHHDQHWSRVLWLYHࢉQDQFLDOLPSDFWIURPWKH&552V

This demonstrates the overall resilience of our business

model to manage our risks and maximise our

opportunities under various future climate pathways.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 66

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

ESG continued

5LVNPDQDJHPHQW

Our CRROs are managed via our risk management

process to ensure a robust and consistent

approach across the Group. We have a high-level

CRRO risk register and mitigation plans, which

are refreshed periodically 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 36).

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 on. The internal audit and risk team

monitor the controls associated with our CRROs

and review these frameworks 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 Risk Committee, 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. For more information on

our principal risks, including climate change, see

pages 34 to 37.

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

ࢉQDQFLDOLPSDFWDVRXWOLQHGRQSDJH(DFKRI

our CRROs has a business owner to oversee the

approach with relevant leadership teams, see

SDJHVDQG7KH*URXSȆVQRQࢉQDQFLDO.3,V

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 by the Board

twice a year (see page 59).

Our science-based Scope 1 and 2 carbon

reduction target is included in the annual

performance incentive for 45% of all RS employees,

including the annual incentive for Executive

Directors, and is also included within our SLL, see

page 60. We monitor a set of key climate metrics to

ensure our net zero action plan is on track, refer to

the Advancing sustainability section pages 42 to 49

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.

Our CRROs are managed via our risk management process

to ensure a robust and consistent approach across the Group

RS Group plc

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

67Annual Report and Accounts for the year ended 31 March 2024

ESG

ASSURANCE

Independent limited assurance report to RS Group plc

(50&HUWLࢉFDWLRQDQG9HULࢉFDWLRQ6HUYLFHV/LPLWHG(50&96ZDVHQJDJHGE\56*URXSSOFWKH*URXSWRSURYLGHOLPLWHGDVVXUDQFHLQUHODWLRQWRWKHVHOHFWHGLQIRUPDWLRQVHWRXWEHORZDQGSUHVHQWHGLQ56*URXSȆV

Annual Report and Accounts 2024 (the Report).

Engagement summary

Scope of our assurance

engagement

Whether the 2023/24 data for the following ESG KPIs on pages 41 to 47 and 54 of the Report are fairly presented, in all material respects, in accordance with the reporting criteria:

– Total Scope 1 and Scope 2 GHG emissions (tonnes CO

– Carbon intensity (total Scope 1 and Scope 2 (market-based) GHG emissions in tonnes CO

e per £ million revenue)

– Total Scope 3 GHG emissions from the following categories (tonnes CO

e):

ੳ Category 1 – Purchased goods and services

ੳ Category 4 – Upstream transportation and distribution

ੳ Category 11 – Use of sold products (RS PRO products only)

– Product transportation emissions intensity (tonnes CO

e per tonne of product sold)

– In-use carbon intensity (RS PRO products only) (tonnes CO

e per tonne of product sold)

– Packaging intensity (tonnes packaging per £ million revenue)

– Percentage of management that are women (percentage)

Our assurance engagement does not extend to information in respect of earlier periods or to any other information included in the Report.

Reporting period

– 2023/24 (1 April 2023 – 31 March 2024)

Reporting criteria

– WBCSD/WRI GHG Protocol Corporate Accounting and Reporting Standard (2004, as updated in 2015 with the Scope 2 Guidance) for the Scope 1 and Scope 2 GHG emissions

– WBCSD/WRI GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard for the Scope 3 GHG emissions

– 7KH*URXSȆVLQWHUQDOGHࢉQLWLRQVEDVLVRIUHSRUWLQJIRUWKH.3,VDVGHVFULEHGLQWKH*URXSȆV(6*EDVLVRIUHSRUWLQJVHHUVJURXSFRPVXVWDLQDELOLW\

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’ issued by the International Auditing and Assurance Standards Board.

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 Report 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 performance data.

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.

ESG continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 68

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Our conclusion

Based on our activities, as described below,

nothing has come to our attention to indicate that

the 2023/24 data for the ESG KPIs listed under

Scope of our assurance engagement on page 68

are not fairly presented on pages 41 to 47 and 54

of the Report, 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 2023/24 data and information for the selected

disclosures 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 disclosures

– Interviews with RS Group management

personnel and external consultants responsible

for the management of the ESG KPI data to

understand and evaluate the data management

systems and processes (including internal review

processes) used for measuring, collecting and

reporting the ESG KPI data

– In-person site visits to RS Group facilities in

Mexico, Italy and the UK to review the data

measurement, collection and reporting

For the carbon and packaging intensity KPIs, we

reviewed the accuracy of the calculations based on

WKHࢉQDODVVXUHG*+*HPLVVLRQVDQGSDFNDJLQJ

GDWDIRUDQGWKHDXGLWHGUHYHQXHࢉJXUH

for 2023/24 provided by the Group; we have not

VHSDUDWHO\DXGLWHGWKHUHYHQXHࢉJXUHXVHGLQWKH

calculation of these KPIs.

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

WUDQVDFWLRQVH[WUDFWHGIURPWKH*URXSȆVࢉQDQFLDO

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

REVHUYDWLRQV:LWKRXWDࢆHFWLQJRXUDVVXUDQFH

conclusion, we make the following observation:

– As disclosed on page 47 of the Report and in the

ESG basis of reporting 2023/24, 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

processes at the facility level and to test the

consistency of reported 2023/24 data for the

energy and fuel use underlying the Scope 1 and

Scope 2 GHG emissions and for packaging with

underlying source data and related documentation

– An analytical review of the 2023/24 data for all

the Group locations included in the reporting

boundary, including a review of the completeness

of the data and of the mathematical accuracy of

the consolidation of the data

– A review of the unit conversion and emission

factors used in the calculation of the GHG

emissions data and the alignment of these

factors with the relevant sources

– $UHYLHZRIWKHGHࢉQLWLRQRIPDQDJHPHQWUROHV

applied by the Group in the calculation of the

percentage of management that are women and

a review of employee data by gender and grade

– A review of the presentation of information

relevant to the scope of our work in the Report

WRHQVXUHFRQVLVWHQF\ZLWKRXUࢉQGLQJV

The limitations of our engagement

The reliability of the assured 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.

Our independence, integrity and quality control

(50&96LVDQLQGHSHQGHQWFHUWLࢉFDWLRQ

DQGYHULࢉFDWLRQERG\DFFUHGLWHGE\WKH8QLWHG

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

IURPELDVDQGFRQࢊLFWRILQWHUHVW2XUFHUWLࢉHG

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.

Gareth Manning

3DUWQHU&RUSRUDWH$VVXUDQFH

UK, London

22 May 2024

(50&HUWLࢉFDWLRQDQG9HULࢉFDWLRQ6HUYLFHV/LPLWHG

www.ermcvs.com

Email: post@ermcvs.com

ESG continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 69

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Regulatory statements

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 42 to 47

– TCFD report: pages 62 to 67

– 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 52 to 57

– Governance report: pages 72 to 119

– Nomination Committee report: pages 88 to 91

– 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 52 to 57

– Doing business responsibly: pages 58 to 61

– 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)

&RQࢊLFW0LQHUDOVDQG&KHPLFDOVRI&RQFHUQ3ROLF\

– Doing business responsibly: pages 58 to 61

– 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

&RUSRUDWH&ULPLQDO2ࢆHQFH3ROLF\

– ESG governance: pages 59 to 60

– Governance report: pages 72 to 119

– Audit Committee report: pages 92 to 98

– Sustainability section of website: rsgroup.com/sustainability

Business model

– Business model and strategy: page 13

1RQࢉQDQFLDO.3,V

– 1RQࢉQDQFLDO.3,VSDJHVDQG

Principal risks

– +RZZHPDQDJHRXUULVNVHࢆHFWLYHO\SDJHVDQG

– Our principal risks and uncertainties: pages 34 to 39

Climate-related

ࢉQDQFLDOGLVFORVXUHV

– Disclosures aligned to clauses (a) to (h) of The Companies

(Strategic Report) (Climate-related Financial Disclosure)

Regulations 2022 detailed in the TCFD report: pages 62 to 67

7KLVVHFWLRQFRQVWLWXWHVWKH*URXSȆVQRQࢉQDQFLDOLQIRUPDWLRQVWDWHPHQW1),6SURGXFHG

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

ZLWKFOHDUJXLGDQFHRQH[SHFWHGEHKDYLRXUVDFWLRQVDQGFRPSOLDQFHUHTXLUHPHQWVFRYHULQJ

each of the below areas.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 70

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

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 2023/24, 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 80 to 82.

Forward-looking statements 7KLVࢉQDQFLDOUHSRUWFRQWDLQVFHUWDLQVWDWHPHQWV

statistics and projections that are or may be forward looking. The accuracy and

completeness of all such statements, including, without limitation, statements

UHJDUGLQJWKHIXWXUHࢉQDQFLDOSRVLWLRQVWUDWHJ\SURMHFWHGFRVWVSODQVDQG

objectives for the management of future operations of RS Group plc and its

subsidiaries is not warranted or guaranteed. These statements typically contain

words such as ‘intends’, ‘expects’, ‘anticipates’, ‘estimates’ and words of similar

import. By their nature, forward-looking statements involve risk and uncertainty

because they relate to events and depend on circumstances that will occur in the

IXWXUH$OWKRXJK56*URXSSOFEHOLHYHVWKDWWKHH[SHFWDWLRQVUHࢊHFWHGLQVXFK

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

GLࢆHUPDWHULDOO\IURPWKRVHH[SUHVVHGRULPSOLHGE\VXFKIRUZDUGORRNLQJ

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.

7KHORQJWHUPFRQVHTXHQFHVRIGHFLVLRQVWKDWDUHWDNHQ

Board oversight of our strategy and ongoing monitoring of performance against agreed metrics Pages 13, 20 to 23 and 80 to 82

Ensuring we have the right foundations to support the Group’s growth opportunity Pages 11 and 12

$FTXLVLWLRQDQGLQWHJUDWLRQRI5LVRXODQG'LVWUHOHFLQWRWKH*URXSȆVEXVLQHVVWRFUHDWHHࢆHFWLYHV\QHUJLHV Pages 12 and 17

Accelerating our growth ambitions organically and inorganically Page 17

5HࢉQLQJRXUVWUDWHJ\WRSURYLGHJUHDWHUIRFXVPRUHDOLJQPHQWEHWWHUSULRULWLVDWLRQDQGLPSURYHGH[HFXWLRQ Pages 13 to 16

The interests of our employees

Strengthening our commitment to our people and culture through the development of our new set of values Pages 18 and 19

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 53 to 55

Prioritising the health, safety and wellbeing of our workforce and providing career development and learning

opportunities

Pages 56 and 57

Continuing our programme of Board employee engagement Pages 73, 77, 80 and 81

7KHQHHGWRIRVWHURXUEXVLQHVVUHODWLRQVKLSVZLWKRXUFXVWRPHUVVXSSOLHUVDQGUHJXODWRUV

Our competitive advantage and strategy in action Pages 13 to 16

Aligning our operating plans to build organisational capabilities and a scalable market strategy Pages 8 and 9

(QJDJLQJZLWKRXUVXSSOLHUVWRKHOSHDVHVLJQLࢉFDQWVXSSO\FKDLQFKDOOHQJHV Pages 7, 9 and 49

The impact of the Group’s operations on the environment and community

Enhancing a purpose-led culture, driving our environmental, social and governance goals in our commitment

for a better world

Pages 40 to 69

Driving to be a sustainable and responsible leader in our sector Pages 58 to 61

Supporting suppliers to provide more sustainable and clean products Page 61

Our reputation for having high standards and sound ethical conduct

Code of conduct: for our people (Speak Up) and our suppliers Pages 59 and 60

Ensuring anti-bribery training is regularly rolled out to our employees Page 60

Ensuring we apply a zero-tolerance approach to modern slavery Page 60

The need to act fairly between members of the Company

Continuing to pursue a progressive dividend policy Page 28

,QFUHDVLQJRSHUDWLRQDOHࢆHFWLYHQHVV Page 16

The Strategic Report was approved by the Board on 22 May 2024 and is signed on its behalf by:

Simon Pryce

&KLHI([HFXWLYH2ࢇFHU

Regulatory statements continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 71

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Governance report

Chair’s letter 73

Our Board of Directors 74

Governance at a glance 76

Board leadership and governance framework 77

Board activities during the year 80

Board evaluation 84

Governance code compliance 86

Nomination Committee report 88

Audit Committee report 92

Directors’ Remuneration report 99

Directors’ report 116

Statement of Directors’ responsibilities 119

Our governance framework has been refreshed

during the year with a view to streamlining and

clarifying responsibilities and simplifying

decision making processes.

CORPORATE

GOVERNANCE

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 72

Dear shareholder

The Board’s priority during the year has been

to ensure the Group is set up for long-term,

sustainable success, while navigating through

headwinds created by the wider macroeconomic

environment. To help enable and support this we

have adopted a more robust governance structure

ZKLFKSURYLGHVFODULࢉHGUHVSRQVLELOLWLHVZKLOH

simplifying approval processes and decision

making across the Group. Further details can

be found on page 79.

Board changes

As reported in the Annual Report and Accounts

2023, Simon Pryce was appointed as Chief

([HFXWLYH2ࢇFHU&(2ZLWKHࢆHFWIURP

3 April 2023. Simon has provided exceptional

OHDGHUVKLSGXULQJKLVࢉUVW\HDUDV&(2HQKDQFLQJ

the governance framework by streamlining the

senior management team to an empowered ExCo,

improving our performance management

framework and aligning the strategy across the

Group to become more focused with an action

orientated and aligned plan to deliver our goals.

As announced during the year, David Egan stepped

GRZQDV&)2ZLWKHࢆHFWIURP0D\.DWH

5LQJURVHZDVDSSRLQWHGDV&)2ZLWKHࢆHFWIURP

2FWREHU.DWHLVDKLJKO\H[SHULHQFHG

CFO with a strong track record of successfully

OHDGLQJࢉQDQFHIXQFWLRQVGULYLQJRSHUDWLRQDO

excellence and delivering accelerated strategic

growth. I would like to take this opportunity to

thank Jane Titchener, who was appointed as

interim CFO between David stepping down and

.DWHȆVDSSRLQWPHQW-DQHPDGHDVLJQLࢉFDQW

contribution during the interim period, ensuring

WKDWZHPDLQWDLQHGRXUࢉQDQFLDOGLVFLSOLQHDQG

provided valuable support to the Board.

Enhancing our governance framework

During the year, the Board oversaw the

streamlining of the senior management team into

an empowered ExCo led by Simon. Alongside this,

the new operating model has been developed

with our three regions supported by Group-wide

enabling functions to ensure we deliver all of

our performance, governance and reporting

requirements. Our accelerator functions have

been created to help drive scale and accelerate

growth across the Group. This new structure

brings more focused attention to the strategic

actions of the Group, allows greater oversight and

brings the voice of customers, suppliers, solutions

and technology to the heart of everything we do.

Strategy

A dedicated strategy Board session was held in

January 2024, where the ExCo presented their

strategic plan to capitalise on the market

opportunity and maximise stakeholder value.

7KHUHࢉQHGVWUDWHJ\ZLOOKHOSGULYHEHWWHU

execution and accelerate value creation through

increased revenue and returns, expanding

automated logistics and closer relationships with

strategic suppliers, all underpinned by our

continued commitment to industry-leading

ESG. An overview of the industrial distribution

landscape and markets provided the Board with

a detailed backdrop for the macro-environment

in which the Group operates. Each regional

president presented the individual strategic plan

for their region and key initiatives which would

deliver the strategy.

Culture

The success of the Group depends on our people

and our culture. During the year, the Board

approved the adoption of our people plan and new

set of values. For more information on our people

plan and new values, see pages 53 and 18 and 19,

respectively.

Stakeholder engagement

Our two designated employee engagement

Directors met with employee representatives from

WKHRࢇFHLQ)UDQNIXUWDQGUHJLRQDOGLVWULEXWLRQ

FHQWUH'&LQ%DG+HUVIHOG*HUPDQ\LQ

September 2023 and employees based in our

/RQGRQ8.RࢇFHLQ'HFHPEHU'XULQJ

these sessions opinions and feedback were

collected and reported back to the Board and

relevant senior leaders and action plans put in

place to address issues raised.

$VDUHVXOWRI6LPRQDQG.DWHMRLQLQJGXULQJ

WKH\HDUWKH\PHWZLWKDQXPEHURIPDMRU

shareholders, together representing 50% of our

share register. Our top 30 shareholders were also

invited to engage with Joan Wainwright, the Chair

of our Remuneration Committee, during the year

to discuss the Directors’ Remuneration Report

and overall remuneration structure.

Further information regarding employee and

shareholder engagement can be found on

pages 81 and 100, respectively.

Board evaluation

An internal evaluation of the Board was conducted

during the year. The outcome of this, along with

an update following the previous year’s externally-

facilitated evaluation, can be found on pages 84

and 85.

Corporate Governance Code

The Company’s statement of compliance with the

8.&RUSRUDWH*RYHUQDQFH&RGHWKH&RGH

can be found on page 87.

Rona Fairhead

Chair

22 May 2024

Chair’s letter

CHAIR’S

LETTER

Activities for 2023/24

– 2YHUVHHLQJWKHUHࢉQHPHQWRIWKH*URXSȆV

strategy and values

– Reviewing the enhanced governance framework

and operating model, including the streamlining

of the senior management to an empowered

([HFXWLYH&RPPLWWHH([&R

– $SSRLQWPHQWRI.DWH5LQJURVHDVWKH*URXSȆV

&KLHI)LQDQFLDO2ࢇFHU&)2

Priorities for 2024/25

– 0RQLWRULQJWKHHPEHGGLQJRIRXURSHUDWLRQDO

model and values

– Continued focus on environmental, social

DQGJRYHUQDQFH(6*PDWWHUVDQGIXUWKHU

enhancement of ESG reporting

– Continued development of the mergers and

DFTXLVLWLRQV0$SLSHOLQH

– 0RQLWRULQJRISHUIRUPDQFHDJDLQVWRXU

strategic actions

RONA FAIRHEAD

CHAIR

Annual Report and Accounts for the year ended 31 March 2024 73

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

RS Group plc

Rona Fairhead

Chair

Committee membership

Date of appointment Nov 2020

Skills, experience and contribution

Rona brings a tremendous range of commercial and strategic

H[SHULHQFHWRWKH&RPSDQ\5RQDȆVVWURQJXQGHUVWDQGLQJRI8.

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

WKH%%&7UXVW0LQLVWHURI6WDWHLQWKH8.'HSDUWPHQWIRU,QWHUQDWLRQDO

7UDGHQRQH[HFXWLYHGLUHFWRURI+6%&+ROGLQJVSOFDQG3HSVL&R

,QFDQGFKDLUDQGFKLHIH[HFXWLYHRࢇFHURI)LQDQFLDO7LPHV*URXS

Current external roles

– Non-executive director of Oracle Corporation

– 0HPEHURIWKH+RXVHRI/RUGV

– 0HPEHURIWKHDGYLVRU\ERDUGRI+RQJ.RQJ([FKDQJHV

Clearing Limited

– Senior independent director of CVC Capital Partners plc

Simon Pryce

&KLHI([HFXWLYH2ࢇFHU

Committee membership

Date of appointment Sep 2016

Skills, experience and contribution

Simon is a highly experienced leader of customer-focused, global

LQGXVWULDOPDQXIDFWXULQJDQGVHUYLFHEXVLQHVVHV+HKDVDVWURQJ

track record of driving results and delivering excellent stakeholder

RXWFRPHVWKURXJKHQKDQFHGSHUIRUPDQFHDQGWKHHࢆHFWLYH

execution of organic and inorganic growth strategies. Previous

UROHVLQFOXGHFKLHIH[HFXWLYHRࢇFHURI8OWUD(OHFWURQLFV+ROGLQJV

plc, group chief executive at BBA Aviation plc and a range of

LQWHUQDWLRQDOࢉQDQFHDQGPDQDJHPHQWUROHVDW*.1SOF-3

0RUJDQDQG/D]DUGV

Current external roles

– None

David Sleath

Senior Independent Director

Committee membership Date of appointment Jun 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

EHHQWKHVHQLRULQGHSHQGHQWGLUHFWRUDW%XQ]OSOF$VVHUYLQJFKLHI

H[HFXWLYHRࢇFHUDQGSUHYLRXVO\FKLHIࢉQDQFLDORࢇFHURI6(*52SOF

'DYLGKDVVWURQJࢉQDQFLDOUHDOHVWDWHPDQXIDFWXULQJDQG

GLVWULEXWLRQH[SHULHQFH+HDOVREULQJVWRWKH%RDUGLQGHSWK

ࢉQDQFLDOVWUDWHJLFDQGJRYHUQDQFHH[SHULHQFHZKLFKDUHHVVHQWLDO

to his role as Senior Independent Director. David has also previously

served as president of the British Property Federation and group

ࢉQDQFHGLUHFWRURI:DJRQSOF

Current external roles

– &KLHIH[HFXWLYHRࢇFHURI6(*52SOF

– Board member, European Public Real Estate Association

Alex Baldock

Independent Non-Executive Director

Committee membership Date of appointment Sep 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

SOF$OH[ZDVSUHYLRXVO\FKLHIH[HFXWLYHRࢇFHURI6KRS'LUHFWQRZ

the Very Group, where he led the business’s digital transformation

IURPDFDWDORJXHUHWDLOHUWRWKH8.ȆVVHFRQGODUJHVWHFRPPHUFH

pureplay and through four consecutive years of record growth in

VDOHVSURࢉWVFXVWRPHUVDWLVIDFWLRQDQGFROOHDJXHHQJDJHPHQW

Current external roles

– Group chief executive of Currys plc

Kate Ringrose

&KLHI)LQDQFLDO2ࢇFHU

Committee membership Date of appointment Oct 2023

Skills, experience and contribution

.DWHKDVH[WHQVLYHH[SHULHQFHRIVXFFHVVIXOO\OHDGLQJWKHࢉQDQFH

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.

.DWHLVDFKDUWHUHGDFFRXQWDQWDQGWUDLQHGZLWK.30*LQ6RXWK

$IULFD3UHYLRXVO\.DWHKDGDVXFFHVVIXO\HDUFDUHHUDW&HQWULFD

plc where she held various senior roles in energy supply, service

VROXWLRQVWUDGLQJDQGࢉQDQFLDORSHUDWLRQV+HUPRVWUHFHQWUROH

was group CFO.

Current external roles

– None

Our Board of Directors

THE RIGHT

BLEND OF

SKILLS AND

EXPERIENCE

Members as at 22 May 2024

Nomination Committee

Audit Committee

Remuneration Committee

Disclosure Committee

Committee Chair

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 74

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Bessie Lee

Independent Non-Executive Director

Committee membership Date of appointment 0DU

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

LQWKHPHGLDFRPPXQLFDWLRQVLQGXVWU\LQ*UHDWHU&KLQD+HU

SUHYLRXVUROHVLQFOXGHFKLHIH[HFXWLYHRࢇFHUDW0LQGVKDUH

*URXS0DQG:33LQ&KLQD

Current external roles

– &KLHIH[HFXWLYHRࢇFHURI:LWKLQOLQN

– &KLHIH[HFXWLYHRࢇFHURI-//*UHDWHU&KLQD

Clare Underwood

Chief of Corporate Services and

Company Secretary

Date of appointment 0DU

Skills, experience and contribution

Clare brings a wealth of FTSE 100 governance experience

WRVXSSRUWWKH%RDUGLQHࢆHFWLYHJRYHUQDQFH7KHVNLOOVDQG

knowledge from her previous roles at John Laing Group plc and

Cable and Wireless Communications plc enable her to provide

ࢉUVWFODVVFRPSDQ\VHFUHWDULDODGYLFHDQGVXSSRUW&ODUHLVD

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, automation, ESG, health

and safety, legal, governance and compliance. Clare is also

executive sponsor for our employee resource group, Elevate.

Louisa Burdett

Independent Non-Executive Director

Committee membership

Date of appointment Feb 2017

Skills, experience and contribution

/RXLVDEULQJVDZHDOWKRIࢉQDQFLDOFRPPHUFLDO0$DQGULVN

management experience to the role of Non-Executive Director

and Chair of the Audit Committee. Louisa is a chartered

DFFRXQWDQWDQGKDVKHOGVHQLRUࢉQDQFLDOSRVLWLRQVLQLQGXVWULDO

manufacturing, publishing and pharmaceutical companies. Louisa

ZDVSUHYLRXVO\WKHFKLHIࢉQDQFLDORࢇFHURI0HJJLWWSOFJURXS

ࢉQDQFHGLUHFWRUDW9LFWUH[SOFDQGFKLHIࢉQDQFLDORࢇFHUDW2SWRV

plc and the Financial Times Group.

Current external roles

– &KLHIࢉQDQFLDORࢇFHURI&URGD,QWHUQDWLRQDOSOF

– &KLHIࢉQDQFLDORࢇFHURI6SLUD[6DUFR(QJLQHHULQJSOF

Navneet Kapoor

Independent Non-Executive Director

Committee membership Date of appointment Jun 2022

Skills, experience and contribution

Navneet brings great international experience, in particular in

WKHWUDQVIRUPDWLRQDQGGLJLWDOࢉHOGVDQGFKDQJHIURPSURGXFW

WRVHUYLFHGULYHQDSSURDFKHV,QKLVFXUUHQWUROHDW$30ºOOHUȁ

0¨UVNKHLVUHVSRQVLEOHIRUGULYLQJFKDQJHVDFURVVFXOWXUHDQG

leadership, modernising processes and technology landscapes,

and developing digital platforms and ways of working. Prior to

this, Navneet held various senior leadership roles at Target India,

part of Target Corporation, and was vice president, marketing at

General Electric in Asia.

Current external roles

– Executive vice president and chief technology and information

RࢇFHURI$30ºOOHUȁ0¨UVN$6

Joan Wainwright

Independent Non-Executive Director

Committee membership

Date of appointment Nov 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.

+HUH[WHQVLYHNQRZOHGJHRIFXVWRPHUH[SHULHQFHDOLJQVZLWK

the Company’s vision and she provides a strong insight into

the customer dynamic in the US. Joan’s previous roles include

SUHVLGHQWFKDQQHOFXVWRPHUH[SHULHQFHDW7(&RQQHFWLYLW\/WG

YLFHSUHVLGHQWSXEOLFDࢆDLUVDW0HUFN&RDQGGHSXW\FRPPLVVLRQHU

of communications at the US Social Security Administration.

Current external roles

– 'LUHFWRURI1-0,QVXUDQFH*URXS

– 0HPEHURIWKHJOREDODGYLVRU\FRXQFLORI6HUYLFH1RZ

1. Joined in September 2016 as Non-Executive Director. Appointed as CEO on 3 April 2023.

 /RXLVDZLOOOHDYH&URGD,QWHUQDWLRQDOSOFLQ-XQHDQGMRLQ6SLUD[6DUFR

Engineering plc in July 2024.

Our Board of Directors continued

Other Directors who served during the year

'DYLG(JDQVWHSSHGGRZQIURPWKH%RDUGRQ0D\

Members as at 22 May 2024

Nomination Committee

Audit Committee

Remuneration Committee

Disclosure Committee

Committee Chair

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 75

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

SKILLS, EXPERIENCE AND KNOWLEDGE OF OUR BOARD

Summary of the skills, experience and knowledge held by our Directors

Digital

89%

Emerging Markets

44%

M&A

67%

Service Industry

78%

ESG

67%

Finance

56%

Strategy

78%

Technology

56%

International Operations

100%

Supply Chain

44%

Distribution

33%

Customers

78%

GOVERNANCE

AT A GLANCE

Governance at a glance

BOARD COMPOSITION

$VDW0DUFK

Gender

Female 5

Male 4

Ethnicity

Ethnic minority 2

Non ethnic minority 7

Age of Directors

Years

45–54 3

55–64 6

Independence

Independent 5

Executive 2

Independent Non-Executive Chair 1

Senior Independent Director 1

Nationality

British 5

Chinese 1

Indian 1

American 1

British and South African 1

 'LYHUVLW\GDWDRIWKHZLGHUVHQLRUOHDGHUSRSXODWLRQLQDFFRUGDQFHZLWKWKHUHTXLUHPHQWVRIWKH)LQDQFLDO&RQGXFW$XWKRULW\)&$/LVWLQJ

Rules, is included in the Nomination Committee report on page 91.

We are incredibly proud to be recognised in the FTSE Women Leaders Top Ten

%HVW3HUIRUPHUVLQUHVSHFWRIWKHQXPEHURIZRPHQRQRXU%RDUGFRPLQJMRLQW

fourth in the FTSE 100. By having such a diverse Board, we’ve seen the real

EHQHࢉWVIURPKDUQHVVLQJWKHIXOOSRWHQWLDORIGLYHUVHWDOHQWVSHUVSHFWLYHVDQG

experiences to drive innovation, sound decision making and sustainable success.”

Board tenure

Years

0–3 years 3

3–6 years 4

6+ years 2

BOARD AND COMMITTEE MEETING ATTENDANCE

Director Board Nomination Audit Remuneration

Rona Fairhead   ––

Simon Pryce  –––

.DWH5LQJURVH

 –––

Alex Baldock  –  

Louisa Burdett

   

1DYQHHW.DSRRU    –

Bessie Lee   ––

David Sleath

   

Joan Wainwright   – 

 .DWH5LQJURVHMRLQHGWKH%RDUGRQ2FWREHU

 /RXLVD%XUGHWWZDVXQDEOHWRMRLQDQXQVFKHGXOHG%RDUGDQG5HPXQHUDWLRQ&RPPLWWHHPHHWLQJGXHWRSULRUHQJDJHPHQWV

 'DYLG6OHDWKZDVXQDEOHWRMRLQDQXQVFKHGXOHG%RDUGPHHWLQJGXHWRDSULRUHQJDJHPHQW

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 76

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Board leadership and governance framework

BOARD LEADERSHIP AND

GOVERNANCEFRAMEWORK

REVIEW OF OUR PURPOSE, VISION, VALUES, CULTURE AND STRATEGY

Board leadership

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

*URXSȆVࢉQDQFLDODQGRSHUDWLRQDOSHUIRUPDQFH

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 and

applies a robust governance framework to ensure

WKDWWKLVOHDGHUVKLSLVGHOLYHUHGHࢆHFWLYHO\

The Board is responsible for ensuring that the

VWUDWHJLFREMHFWLYHVDUHDGHTXDWHO\UHVRXUFHG

and supported to help ensure the long-term

success of the Group, realisation of its strategy,

DQGWRPRQLWRUWKHHࢆHFWLYHGHSOR\PHQWRI

those resources. The Group’s risk management

framework supports the strategic actions of the

*URXSZLWKFRQWUROVWRKHOSPLWLJDWHLGHQWLࢉHG

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 32 to 37.

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 Chair 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 88 to 115.

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 73.

In addition to the Committees of the Board, the

([&RLVUHVSRQVLEOHIRUPDNLQJHࢆHFWLYHGHFLVLRQV

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

EXVLQHVV:LWKHࢆHFWIURP$SULOWKH

members of the ExCo are the CEO, CFO, the

3UHVLGHQWVIRU(0($$PHULFDVDQG$VLD3DFLࢉF

Chief of Solutions and Services, Chief of Product

and Supply Chain, Chief of Customer Experience,

Chief of Corporate Services and Company

6HFUHWDU\&KLHI3HRSOH2ࢇFHU&32DQG

&KLHI,QIRUPDWLRQ2ࢇFHU7KH([&RKDV

representation from each of the regions, both

accelerating and enabling functions and brings

the voice of customers, suppliers, solutions and

technology to the decision making process.

To achieve the long-term sustainable value

generation of the Group, the Board has

continued to work closely with the ExCo on the

*URXSȆVSXUSRVHRIPDNLQJDPD]LQJKDSSHQIRU

a better world.

During the strategy session held in January 2024,

the Board was provided with an overview of the

current Group strategy, where focus will be going

forward, areas of prioritisation and the

challenges to be addressed to drive better

execution and accelerate value creation.

Our overall Group strategy remains the same,

with clear focus on customers, products,

solutions, customer experience and operational

H[FHOOHQFH,WKDVEHHQUHࢉQHGGXULQJWKH\HDUWR

provide greater alignment, better prioritisation

and improved execution. During the strategy

session, the Board considered and discussed

details in respect of the industrial distribution

landscape and markets along with the Group

strategy to capitalise on the market opportunity

and maximise stakeholder value.

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 the year, our purpose and new set

of Group-wide values have also been considered

in detail by the Board. This one set of Group-wide

values will support delivery of our strategy by

uniting and aligning the Group and providing

direction for the culture and behaviours across

WKHRUJDQLVDWLRQ+DYLQJEHHQUHYLHZHGRXU

purpose remains the same. See page 18 for

details of our values.

Other activities undertaken by the Board

during the year to monitor the Group’s culture

have included:

– A review of the proposed people plan which

highlighted the key initiatives which will

support our strategic actions. See page 53

for further information.

– %HVVLH/HHDQG-RDQ:DLQZULJKWDVRXU

designated Directors for employee

HQJDJHPHQWFRQGXFWHGWZRHPSOR\HH

engagement sessions during the year. In-depth

feedback was then provided to the Board

following these engagements, with outcomes

being shared with relevant management.

– In September 2023, the Board visited our

RࢇFHVLQ)UDQNIXUWDQGUHJLRQDO'&LQ%DG

+HUVIHOG*HUPDQ\7KLVLQFOXGHGWKH

opportunity for members of the Board to meet

employees of the regional DC and have informal

discussions with regional leadership.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 77

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Position Responsibilities

Chair

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

– /HDGLQJWKH%RDUGVXFFHVVLRQSODQQLQJDQGVHHNLQJWRHQVXUHHࢆHFWLYHFRPPXQLFDWLRQZLWKVKDUHKROGHUV

Executive Directors

Simon Pryce (CEO)

– 0DQDJLQJDQGOHDGLQJWKH*URXSRQDGD\WRGD\EDVLVPDNLQJGHFLVLRQVRQPDWWHUVDࢆHFWLQJWKHRSHUDWLRQDQGSHUIRUPDQFH

of the Group’s business

– Designing, developing and implementing the strategic plans

– Ensuring robust management succession plans are in place

Kate Ringrose (CFO)

– )LQDQFLDOPDQDJHPHQWDQGLPSOHPHQWDWLRQDQGPRQLWRULQJRIࢉQDQFLDOFRQWUROV

– 'HYHORSLQJWKH*URXSȆVࢉQDQFLDOSROLFLHVDQGVWUDWHJLHV

– 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 Chair and the CEO

– Acting as a conduit for the views of other Non-Executive Directors and conducting the Chair’s annual performance appraisal

– Being available to shareholders to help resolve concerns

Non-Executive Directors

Alex Baldock

Louisa Burdett

Navneet Kapoor

Bessie Lee

Joan Wainwright

– Overseeing and constructively challenging executive management regarding the performance of management against agreed

SHUIRUPDQFHREMHFWLYHVDQGKHOSLQJWRUHYLHZDQGPRQLWRUWKH*URXSȆVVWUDWHJ\

– 6DWLVI\WKHPVHOYHVRQWKHLQWHJULW\RIࢉQDQFLDOLQIRUPDWLRQDQGUHYLHZLQJWKH*URXSȆVULVNH[SRVXUHDQGFRQWUROV

Company Secretary

Clare Underwood

– 6XSSRUWLQJDQGDGYLVLQJWKH%RDUGRQPDWWHUVUHODWLQJWRJRYHUQDQFHHQVXULQJJRRGLQIRUPDWLRQࢊRZVDQGSURYLGLQJSUDFWLFDO

support to the Directors

– Organising Directors’ induction and training

Board leadership and governance framework continued

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 Chair,

CEO, CFO, Senior Independent Director, Board and Committees are agreed by the Board. See page 79 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

YLUWXDOPHHWLQJVLQDQGDEUHDNGRZQRI

attendance is shown in the table on page 76. In

addition to the seven scheduled Board meetings,

a further two ad hoc meetings were held.

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 Chair or Company

Secretary to ensure their contributions are raised

at the meeting.

During the year, the Chair held a number of

meetings with the Non-Executive Directors

without the Executive Directors being present.

The Non-Executive Directors also met without

the Chair to discuss the Chair’s performance.

The Chair 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

%RDUGDVDZKROH7KHࢉQGLQJVRIWKHUHYLHZDUH

used to establish an ongoing programme of

DFWLRQVWRLPSURYHHࢆHFWLYHQHVVRIERWKWKH%RDUG

and the Committees. Further information on this

can be found on pages 84 and 85.

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

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 78

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

GOVERNANCE FRAMEWORK

2XUJRYHUQDQFHIUDPHZRUNXQGHUSLQVDQGVXSSRUWVUREXVWJRYHUQDQFHDFURVVWKH*URXSWRKHOSHQVXUHHࢇFLHQWGHFLVLRQPDNLQJDQGFOHDUGLYLVLRQRIUHVSRQVLELOLWLHV

Board leadership and governance framework continued

The Board

Chair: 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

RIWKH&RPSDQ\IRUWKHEHQHࢉWRIRXUPHPEHUV

and stakeholders.

The Board discharges some of its

responsibilities directly or has delegated authority

to its Committees.

Disclosure Committee

Chair: Simon Pryce

– Reviews procedures, systems and controls for

LGHQWLࢉFDWLRQDQGWUHDWPHQWRILQVLGHLQIRUPDWLRQ

– Reviews regulatory announcements, shareholder

circulars, prospectuses etc. before release

– Considers materiality of variances between

performance and forecasts

Nomination Committee

See pages 88 to 91 for further details

Chair: Rona Fairhead

– Reviews the structure, skills, knowledge, experience and diversity of the Board

– ,GHQWLࢉHVDQGQRPLQDWHVIRUDSSURYDOE\WKH%RDUGFDQGLGDWHVWRࢉOO'LUHFWRUSRVLWLRQV

– Leads succession planning for Non-Executive, Executive Directors and has oversight of

succession planning for the ExCo

Audit Committee

See pages 92 to 98 for further details

Chair: Louisa Burdett

– 0RQLWRUVLQWHJULW\RIࢉQDQFLDOVWDWHPHQWVDQGDQQRXQFHPHQWV

– 5HYLHZVWKH*URXSȆVLQWHUQDOࢉQDQFLDOFRQWUROVDQGLQWHUQDOFRQWURODQGULVN

management systems

– 0RQLWRUVWKHLQWHUQDODXGLWIXQFWLRQ

– 0DQDJHVWKHH[WHUQDO$XGLWRUV

Remuneration Committee

See pages 99 to 115 for further details

Chair: Joan Wainwright

– 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

During the year, the Group’s governance

framework has been refreshed with a

view to streamlining responsibilities and

accountabilities, simplifying approval

SURFHVVHVDQGFUHDWLQJDFOHDUHUࢊRZRI

information to enable swifter, more robust

decision making. As part of this, the following

actions have been taken:

– Streamlined the senior management team

to an empowered ExCo

– Reviewed and enhanced the Schedule of

0DWWHUV5HVHUYHGIRUWKH%RDUG)ORZLQJ

from this, a revised Group Delegation of

Authority has been approved by the Board

which provides the Group with clear

guidance regarding the decision making

and approval processes throughout the

Group, balancing authority with

responsibility and accountability

– &OHDUO\GHࢉQHGWKHGLYLVLRQRIUHVSRQVLELOLWLHV

between the Board, its Committees,

individual members of the Board and the

ExCo, with a dedicated session held at an

ExCo meeting whereby the Company

Secretary presented the details to the

ExCo members

– The Disclosure Committee Terms of

Reference have been refreshed and adopted

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 59 and 60.

,QRUGHUWRIDFLOLWDWHDQHࢆHFWLYHZRUNLQJUHODWLRQVKLSEHWZHHQWKH%RDUGDQG([&RWKH%RDUGUHFHLYHVUHJXODUXSGDWHVDQGGHWDLOHGUHYLHZVIURPWKH([&RWKURXJKRXWWKH\HDU

Executive Committee (ExCo)

Chair: Simon Pryce

– $VVLVWLQJWKH&(2LQH[HUFLVLQJKLVDXWKRULW\LQUHODWLRQWRDOOPDWWHUVDࢆHFWLQJWKHRSHUDWLRQVSHUIRUPDQFHDQGVWUDWHJ\ZLWK

input from regional, accelerating and enabling functions

– Oversight of day-to-day management of the Group

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 79

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Board activities during the year

BOARD ACTIVITIES

DURING THE YEAR

The following pages outline some of the key topics

reviewed, monitored, considered and discussed

by the Board during the year. 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

SURFHVVNH\VWUDWHJLFLWHPVDUHLGHQWLࢉHGDQG

scheduled throughout the year. The Chair, with

assistance from the CEO, CFO and Company

Secretary, agrees the agenda for each Board

PHHWLQJ7KLVSURFHVVHQVXUHVWKDWVXࢇFLHQWWLPH

is being set aside for strategic discussions and

business critical items, while including regular

standing items, such as reports on trading and

ࢉQDQFLDOSHUIRUPDQFHDQGURXWLQHUHSRUWLQJRU

compliance requirements.

Our Strategic Report on pages 1 to 71

demonstrates how the business considers and

engages with the Company’s key stakeholders:

our people, customers, suppliers, communities

and shareholders. This section of the Governance

Report sets out 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

Activity Stakeholders

Strategy

6WUDWHJLFXSGDWHIURPWKH$VLD3DFLࢉFWHDPKLJKOLJKWLQJ

performance, regional market trends and strategic plans.

The Board was provided with an update on the integration of

Distrelec, including progress to date and key milestones. As part of

both the acquisition and integration process, various stakeholders

were considered, such as the impact on employees, customers and

suppliers of both the acquired entity and the existing RS business

WRKHOSHQVXUHWKHDFTXLVLWLRQZLOOSURYLGHORQJWHUPEHQHࢉWVWRDOO

Culture / people

$SSURYDORIWKHDSSRLQWPHQWRI.DWH5LQJURVHDV&)2ZLWKHࢆHFW

from 2 October 2023. For further details of the recruitment and

approval process, see page 89.

Governance

7KH$QQXDO*HQHUDO0HHWLQJ$*0LVKHOG6KDUHKROGHUVKDYHWKH

opportunity to attend, vote and raise any questions directly to the

Board.

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.

A timeline is provided over the following pages

detailing the key activities of the Board during the

year. Throughout the year, the Board and its

Committees received regular updates on various

aspects of the business. Such updates included

ࢉQDQFLDOUHSRUWLQJRISHUIRUPDQFHGHWDLOVRIRXU

acquisition pipeline, feedback from employee

engagement surveys and updates on shareholder

engagement and activities. Regular reports were

also provided in respect of health and safety

performance and actions, whistleblowing activity,

data protection and cyber security and any legal or

regulatory matters which arose from time to time.

1HW]HURDQGFOLPDWHWUDQVLWLRQSODQVHVVLRQVZHUH

delivered to the Board and the ExCo, highlighting

strategic planning, performance monitoring and

climate education and skills development. See the

case study on page 83 for further details.

.H\WKHPHVDQGREVHUYDWLRQVIURPHPSOR\HH

HQJDJHPHQWVHVVLRQVKHOGLQWKH8.DQG*HUPDQ\

during the year were around working conditions,

IT infrastructure, strategy, culture and clarity of

communications and processes.

Stakeholder key

Our people Customers Suppliers Communities Shareholders

APR

MAY

JUL

JUN

Activity Stakeholders

Finance

Approval of the year end results, including consideration of viability and going concern. Approval of

WKHSD\PHQWRIWKHࢉQDOGLYLGHQGVXEMHFWWRVKDUHKROGHUDSSURYDOLQ-XO\0XOWLSOHVWDNHKROGHUVZHUH

considered when deciding to pay the dividend, including impact on employees and their remuneration

and working conditions, customer and supplier propositions, acquisitions and our shareholder base.

ESG

The Audit Committee approved, and recommended to the Board, the ESG-related disclosures around an

ESG double materiality assessment, Scope 3 carbon emissions reporting and results of the quantitative

FOLPDWHVFHQDULRDQDO\VLVIRU7DVN)RUFHRQ&OLPDWHUHODWHG)LQDQFLDO'LVFORVXUHV7&)'DQGWKHDGRSWLRQ

of the TCFD report. The Board also approved the production of a dedicated ESG report to meet our full ESG

reporting requirements. See pages 40 to 69 for further details.

Governance

$SSURYDORIWKH(6*JRYHUQDQFHIUDPHZRUNZKLFKLQFOXGHVFRQࢉUPLQJWKH([&RȆVUHVSRQVLELOLW\IRU

climate strategy, development and execution of policies, initiatives and disclosures. The Board continues

WRPDLQWDLQRYHUVLJKWWKURXJKUDWLࢉFDWLRQRISROLFLHVVWUDWHJ\NH\LQYHVWPHQWLQLWLDWLYHVDQGSHUIRUPDQFH

monitoring. Bessie Lee was appointed as the Non-Executive Director ESG lead to create a clear and robust

governance link between the Board and ExCo. Operational management of our 2030 ESG action plan

and climate-related risks and opportunities are embedded within relevant central functions and the three

UHJLRQVVHHSDJHVDQGIRUIXUWKHUGHWDLOVUHODWLQJWR(6*JRYHUQDQFH

(YDOXDWLRQRIDOOSURYLVLRQVRIWKH&RGHWRUHYLHZFRPSOLDQFHIRUWKH\HDUHQGHG0DUFK

Reviewed the results of the externally-facilitated Board evaluation and agreed the actions arising from

the evaluation. See pages 84 and 85 for further details.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 80

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Board activities during the year continued

Activity Stakeholders

Strategy

7KH%RDUGUHFHLYHGDGHHSGLYHVHVVLRQRQ$UWLࢉFLDO,QWHOOLJHQFH$,LQFOXGLQJ

the wider view on AI, opportunities for RS, risks and mitigations and our approach

to governance.

Strategic update from the Americas team provided a strategic regional update to

the Board, including details of performance, current initiatives, strategic priorities

and an overview of the external market.

Culture / people

$SSURYDORIWKH&)2ȆVREMHFWLYHVWRHQVXUHDOLJQPHQWWRWKH*URXSȆV

VWUDWHJLFREMHFWLYHV

A pensions funding update was provided to the Board. Regular updates

RQIXQGLQJSRVLWLRQRIWKH8.GHࢉQHGEHQHࢉWVFKHPHKHOSWRHQVXUHWKH

pension fund is appropriately funded for our current and former employees.

Further details regarding the pension scheme can be found on page 28.

Stakeholder key

Our people Customers Suppliers Communities Shareholders

SEP

NOV

AUG

Activity Stakeholders

Strategy

The Board considered the strategic planning process. This

included an overview of the planning process, the strategic

development, long-term planning cycle and key discussion

points for the Board to build in feedback ahead of the workshop

in January.

The Investor Relations team presented its strategy and

action plan to the Board, providing an overview of the Group’s

proposed shareholder-related reporting and engagement,

along with outlining the alignment between internal and

external reporting cadence.

Culture / people

Bessie Lee and Joan Wainwright met with representatives from

WKH/RQGRQ8.RࢇFHIRUDQHPSOR\HHHQJDJHPHQWVHVVLRQ

Feedback was provided to the Board and actions taken by

management to address any issues raised.

5HYLHZRIWKH([&RPHPEHUVȆREMHFWLYHVWRHQVXUHWKH([&R

members are aligned to the Group’s strategic actions.

OCT

DEC

Activity Stakeholders

Strategy

7KH%RDUGYLVLWHGRXURࢇFHLQ)UDQNIXUWDQGUHJLRQDO'&DW%DG

+HUVIHOG*HUPDQ\$QXSGDWHRQWKH*HUPDQ$XVWULDQDQG

Swiss region was provided by the leadership team, including

an overview of current performance, regional market trends,

VWUDWHJLFREMHFWLYHVFXOWXUHDQGLQWHJUDWLRQRI'LVWUHOHF

Presentations were also given to the Board in respect of supply

chain and technology which provided an update on performance

and oversight of strategic actions within the teams.

Risk

The Board reviewed the principal risks of the Group and

considered the half-year risk statement. Further information

regarding the management of the Group’s principal and emerging

risks can be found on pages 34 to 37.

Culture / people

Bessie Lee and Joan Wainwright held an employee engagement

VHVVLRQZLWKUHSUHVHQWDWLYHVIURPERWKWKH)UDQNIXUWRࢇFHDQG

UHJLRQDO'&DW%DG+HUVIHOG*HUPDQ\)XUWKHULQIRUPDWLRQFDQEH

found on pages 73 and 80.

7KH%RDUGDSSURYHGWKHREMHFWLYHVRIWKH&(27KHREMHFWLYHV

provide stretching targets and are clearly linked to the successful

delivery of our strategic actions.

Activity Stakeholders

Finance

$SSURYDORIWKHKDOI\HDUDFFRXQWVLQFOXGLQJ

FRQVLGHUDWLRQRIJRLQJFRQFHUQDORQJZLWK

interim dividend payment to be made to

shareholders in January.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 81

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Board activities during the year continued

Activity Stakeholders

Finance

An update on the tax strategy and an overview of the key tax-related governance controls was provided

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

RYHUYLHZRIQHW]HURSURJUHVVWRGDWHLPSDFWRIUHFHQWDFTXLVLWLRQVDQGLQLWLDWLYHVDORQJZLWKFOLPDWH

HGXFDWLRQDQGVNLOOVGHYHORSPHQWVHHWKHFDVHVWXG\RQSDJHIRUIXUWKHULQIRUPDWLRQ

Culture / people

The new Group values were presented to the Board providing oversight of the engagement programme

XQGHUWDNHQWRHQVXUHWKHYDOXHVUHࢊHFWHGWKH56FXOWXUHDQGZRXOGUHVRQDWHDFURVVWKH*URXS7KH%RDUG

endorsed the values and were supportive of the rollout plan. Further details of our values can be found on

pages 18 and 19.

Governance

An update on the new Corporate Governance Code was provided to the Board, outlining new requirements

and key timeframes. The Audit Committee has also received regular updates over the last year in respect

RIWKHQHZUHTXLUHPHQWVUHODWLQJWRLQWHUQDOFRQWUROVRYHUࢉQDQFLDOUHSRUWLQJSURYLGLQJRYHUVLJKWDVWRWKH

measures and processes implemented by the Group to help ensure compliance.

Activity Stakeholders

Culture / people

The CPO provided the Board with an overview

of the proposed people plan and people strategy.

This underpins our strategic priorities, and helps

to ensure clear focus on the key initiatives

proposed under each strategic action.

Governance

The Board reviewed the division of responsibilities

for the Board and certain individuals, including the

Chair, CEO and Senior Independent Director, as

part of its governance framework structure.

Activity Stakeholders

Strategy

The Board held a strategy session with members

of the ExCo where the proposed strategic plan

was presented and discussed in detail. The Board

DSSURYHGWKHUHࢉQHGVWUDWHJ\DQGWKHࢉYH\HDU

plan. See pages 73 and 77 for further details.

JAN

MAR

FEB

Stakeholder key

Our people Customers Suppliers Communities Shareholders

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.”

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 82

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

GOVERNANCE IN ACTION

RESPONDING TO

CLIMATE CHANGE

Enabling our Board and ExCo to

UHVSRQGHࢆHFWLYHO\WRFOLPDWHFKDQJH

As a global business enabling the technology, manufacturing

and engineering sectors, our long-term success and value

creation potential is inextricably linked to how we respond to

the challenges and opportunities posed by climate change.

The decisions and actions we take now will have an impact

on our ability to mitigate our longer-term risks, while fully

leveraging the clear opportunity we see to be a key enabler

of a lower-carbon global industrial sector. To support this

agenda, it is essential our ExCo and Board are fully informed

and enabled to lead our climate response.

In 2023/24, we delivered climate sessions for our ExCo

and Board on the key areas of our climate agenda:

– 2XUQHW]HURWUDMHFWRU\ȁLQFOXGLQJVWUDWHJ\SHUIRUPDQFH

LQLWLDWLYHGHYHORSPHQWDQGLQYHVWPHQWSODQQLQJVHHSDJH

– ESG products and solutions strategy, initiative development

DQG LQYHVWPHQWSODQQLQJVHHSDJHVDQG

– Updates on our climate-related risks and opportunities

SURJUHVV DQGVFHQDULRPRGHOOLQJVHHSDJH

These sessions ensure the ExCo and Board have a solid

understanding of the latest climate science, best practice

in climate risk mitigation, a view of the rapidly evolving

stakeholder expectations and a clear line of sight of our

FXUUHQW SHUIRUPDQFHDQGIXWXUHWUDMHFWRU\7KLVEXLOGV

capability and ensures they can make the informed key

decisions that will leverage our climate opportunities and

mitigate our risks, as part of wider corporate governance

and delivery of our strategy.

Board activities during the year continued

For more information

on our net zero

strategy and how

we are advancing

sustainability across

the business,

see page 43.

For more information

on our commitment

to doing business

responsibly, see

page 58.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 83

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Board evaluation

BOARD

EVALUATION

Board evaluations provide invaluable insight and

REMHFWLYLW\WRWKH'LUHFWRUVDQGWKH&RPPLWWHHV

which in turn enables the Board to improve its

OHDGHUVKLSHࢆHFWLYHQHVVDQGIRFXV([DPLQLQJ

each Director’s role and their corresponding

responsibilities within the overall Board dynamic

encourages collaborative decision making and

strategic clarity.

The outcomes from the 2023/24 Board evaluation are as follows:

Key recommendations Actions agreed

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. This has renewed

focus with the appointment of the new CPO during the year

– Succession planning would be scheduled for review twice a year by the

Nomination Committee

– The Nomination Committee considered and discussed an update on

VXFFHVVLRQSODQQLQJLQ0DUFK7KLVSURYLGHGDFOHDUGLUHFWLRQRIIRFXV

and plans for the coming year. The Committee will monitor progress by

receiving biannual updates

Strategy

– 0RUHLQIRUPDWLRQDQGDQDO\VLVRQFRPSHWLWLRQLQNH\PDUNHWVKRZWKH

*URXSGLࢆHUHQWLDWHVLWVHOIDQGLQFUHDVHGFODULW\RQSHUIRUPDQFHFRPSDUHG

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

0DUFK7KLVZLOOEHEXLOWLQWR%RDUGDJHQGDVIRUWKHFRPLQJ\HDUWR

help ensure appropriate market and strategic information is included

within the regional performance discussions

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 Chair, Executive Directors

and the Company Secretary

7KH%RDUGUHࢊHFWVRQLWVSHUIRUPDQFHDQG

HࢆHFWLYHQHVVDQQXDOO\'XULQJWKH%RDUG

conducted an internal evaluation following the

H[WHUQDOHYDOXDWLRQLQ7KHVFRSHRIWKH

evaluation covered the Board and its Committees,

along with performance of the Chair, Senior

Independent Director and Company Secretary.

The Chair 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 Chair 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 Chair’s

performance and the feedback was subsequently

shared with the Chair. The results of the evaluation

ZHUHDVVHVVHGDQGGLVFXVVHGDWWKH0DUFK

Board meeting, following which the Board

FRQࢉUPHGLWVYLHZWKDWWKH%RDUGFRQWLQXHV

WRRSHUDWHHࢆHFWLYHO\ZLWKLQDQLQFOXVLYHDQG

transparent environment. Overall, there were

positive improvements in the quality of discussions

and papers, in particular, the strategy session in

January 2024 provided a clear articulation of the

Group’s strategic direction.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 84

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

3URJUHVVDJDLQVWWKH%RDUGHࢆHFWLYHQHVVHYDOXDWLRQ

$VXPPDU\RIWKH%RDUGȆVSURJUHVVDJDLQVWWKHDFWLRQVIURPWKHHYDOXDWLRQLVVHWRXWEHORZ

Key recommendations Actions agreed Progress against actions

Succession planning and talent management

– Consideration to be given in respect of skills gaps and

maintaining the right balance of experience and background

for new Board appointments

– Continued focus on talent, development and succession of the

PHPEHUVRIWKHVHQLRUPDQDJHPHQWWHDPQRZWKH([&R

– Recruitment to take into consideration aspects such as existing

appointments, time commitments and locality

– Further agenda items to be included in the forward looking

agenda regarding key people topics and succession planning

– $UROHSURࢉOHKDVEHHQGHYHORSHGKLJKOLJKWLQJNH\DWWULEXWHV

required for future Non-Executive Director appointments

– As a result of the appointment of a new CPO, renewed focus

has been given to the people plan, succession planning and

development which will evolve over the coming year

– An update on the ExCo succession plan was discussed by the

1RPLQDWLRQ&RPPLWWHHLQ0DUFK

Strategy

– Increased information to be provided to the Board regarding

exploration of opportunities in global markets, with the continued

prioritisation of technology and digital. Information provided on

the market and competitors to be further enhanced

– 5HࢉQHKRZSURJUHVVLVWUDFNHGDJDLQVWWKHVWUDWHJ\ZLWK.3,V

underpinned by deep dives and regular focus on critical areas

such as technology and new products

– Annual forward looking calendar for strategic discussions to

be reviewed

– 3HUIRUPDQFHUHSRUWLQJDQG.3,VWREHUHYLHZHGE\PDQDJHPHQW

Deep dives to be aligned

– :LWKWKHDSSRLQWPHQWRIERWK6LPRQDQG.DWHDV([HFXWLYH

Directors during the year, there has been a thorough review of

our strategy. To align with this, the forward looking agenda was

considered by the Board and the strategic aspects to be presented

during the year were agreed to ensure a suitable cadence of topics

– A deep dive in respect of AI was held in December 2023, with

further sessions to be scheduled

%RDUGHࢆHFWLYHQHVVDQGSURFHVV

– Agendas to have a sharper focus around priority topics and

UHGXFHWKHQXPEHURIVWDQGLQJUHSRUWVDQGXSGDWHV.H\WRSLFV

to be presented as deep dives at regular intervals to help further

enhance discussion

– Continued consideration to be given on how to keep Board and

Committee papers concise and easy to navigate

– A review of agendas and standing reports will be built into the

above review of the forward looking calendar

– The Board paper template will be updated with clear guidance to

users on what information to include and level of detail required

– Board papers and presentations have been evolving over the year

under new executive leadership. Templates and guidance have

been updated however, to address any concerns or requirements

RIWKH%RDUGDVSHFLࢉFTXHVWLRQZDVLQFOXGHGLQWKLV\HDUȆV%RDUG

evaluation to seek further feedback

– Board paper templates have been reviewed, with best practice

being shared amongst presenters. This will help ensure

consistency of content, highlighting key messages to the Board

and providing a clear indication of what is required of the Board

during the meeting

Board evaluation continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 85

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Governance code compliance

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

H[WHUQDOO\DYDLODEOHEULHࢉQJVDQGWUDLQLQJVHVVLRQV

External training includes facilitated events, forum

discussions and seminars related to the listed

company environment, many of which were

RࢆHUHGYLUWXDOO\,QWKH%RDUGXQGHUWRRN

deep dives which included the following:

– AI, which provided an overview of opportunities

for the Group, risks and mitigations and the

Group’s approach to AI-related governance

– Emerging ESG-related reporting regulations,

focusing on climate transition planning for the

8.ȆV7UDQVLWLRQ3ODQ7DVNIRUFHDQGWKH&RUSRUDWH

Sustainability Reporting Directive

– The Board held a session in October 2023

regarding the strategic planning process which

outlined the longer-term cycle of strategic

thinking, implementation and refresh.

Finally, to enhance operational awareness, the

%RDUGWUDYHOOHGWR*HUPDQ\WRYLVLWRXURࢇFHLQ

)UDQNIXUWDQGUHJLRQDO'&LQ%DG+HUVIHOGLQ

September 2023. This provided an opportunity

IRU 'LUHFWRUVWRPHHWZLWKHPSOR\HHVDQGVHHࢉUVW

hand the operations at the regional DC. As part

of this site visit, the Board was given an in-depth

business overview and strategy update for RS

LQ *HUPDQ\$XVWULDDQG6ZLW]HUODQG

The Company Secretary is available to all Directors

whenever needed and ensures that both Directors

and Committees have access to independent

SURIHVVLRQDODGYLFHDWWKH*URXSȆVH[SHQVHLIWKH\

GHHPLWQHFHVVDU\WRFDUU\RXWWKHLUUROHHࢆHFWLYHO\

Following the appointment of any new Director,

the Chair 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 a pack which sets

out the relevant information on the Company’s

approach to governance, information on key

Group policies and day-to-day administrative

matters, as well as historical Board and Committee

papers if applicable.

.DWH5LQJURVHMRLQHGWKH%RDUGLQ2FWREHU

and has undertaken a thorough induction plan

since her appointment, details of which can be

found to the right. Simon Pryce also received an

LQGXFWLRQSURJUDPPHZKLFKZDVWDLORUHGWRUHࢊHFW

the time he served as a Non-Executive Director

VLQFH6LPRQVSHQWWKHࢉUVWIRXUPRQWKVRI

his appointment as CEO with a programme of

meetings with key stakeholders. In addition to this

he immersed himself in the business and travelled

to all the regions to build his knowledge of our

culture, operations and requirements across

the Group.

Appointment and time commitments

The Chair, Senior Independent Director and other

Non-Executive Directors each have letters of

appointment with RS Group plc and do not serve,

or are employed in any capacity by, the Group.

Non-Executive Directors are generally appointed

IRUWKUHH\HDUࢉ[HGWHUPVKRZHYHULQOLQHZLWK

what is considered good governance practice,

all Directors are proposed for annual re-election

RU HOHFWLRQLIQHZO\DSSRLQWHGE\VKDUHKROGHUVDW

WKH $*0ZKHUHOHWWHUVRIDSSRLQWPHQWIRUHDFK

Non-Executive Director are available for inspection.

As illustrated on pages 74 and 75, the Board has a

diverse and appropriate range of skills and

H[SHULHQFHDQGZRUNVHࢆHFWLYHO\LQLWVUROH

The expectation regarding time commitment for

%RDUGPHPEHUVWRHࢆHFWLYHO\GLVFKDUJHWKHLU

duties is set out in the Directors’ letters of

appointment. The external commitments of our

Directors are kept under review to ensure they

KDYHWKHWLPHWRFRQWULEXWHHࢆHFWLYHO\WRWKH

activities of the Board and its Committees

throughout the year. Any additional external

appointment taken on by a Director must be

approved by the Chair prior to appointment,

to ensure that the Director’s ability to meet the

required time commitments to the Group is

maintained. During the year, Louisa Burdett

informed the Board of her intention to step

down from her position as CFO at Croda

International plc from June 2024 and her

appointment as CFO of Spirax-Sarco Engineering

plc from July 2024. The Board considered the time

FRPPLWPHQWDQGSRWHQWLDOFRQࢊLFWVRILQWHUHVW

LQYROYHGDQGZDVVDWLVࢉHGWKDWVKHZRXOGFRQWLQXH

WRKDYHVXࢇFLHQWWLPHWRFRPPLWWRWKH56%RDUG

and her committee appointments.

The Board, following the annual evaluation

process, also considers whether each Director

SHUIRUPVHࢆHFWLYHO\DQGGHPRQVWUDWHVWKHLU

commitment to the role. The Board recommends

WKDWDOO'LUHFWRUVEHUHHOHFWHGDQG.DWH5LQJURVH

WREHHOHFWHGDWWKLV\HDUȆV$*0

As recommended by the Code, the Executive

Directors who held roles during the year did not

hold more than one non-executive directorship

LQ D)76(FRPSDQ\RUDQ\RWKHUVLJQLࢉFDQW

appointments.

$VSDUWRI.DWHȆVRQERDUGLQJKHULQGXFWLRQKDVEHHQ

split into two aspects with the aim of providing an

HࢆHFWLYHLQWURGXFWLRQWR56ERWKWRWKHEXVLQHVVDV

a whole and to the boardroom.

7KHࢉUVWRIWKHVHLVDQRQJRLQJSURJUDPPHRI

meetings with key people in various regions and

functions, along with key advisors. She met with

each of the three regional presidents and those

responsible for the accelerating and enabling

functions, providing an invaluable introduction

into each region and area of business specialism.

'XULQJ.DWHȆVࢉUVWVL[PRQWKVVKHKDVWUDYHOOHGWR

$PHULFDVLQFOXGLQJ56LQWKH86DQG5LVRXOLQ

0H[LFR%HDXYDLV)UDQFH%DG+HUVIHOG*HUPDQ\

Johannesburg, South Africa and both our global DCs

LQ&RUE\DQG1XQHDWRQ8.6KHZLOOYLVLWDQXPEHU

RI IXUWKHUPDUNHWVLQFOXGLQJ,WDO\6SDLQ0DOD\VLD

Singapore, Australia, Denmark and Poland, along

with meeting our colleagues from Distrelec during

WKHFRXUVHRI.DWHKDVDOVRPHWZLWKRXU

PDMRUVKDUHKROGHUVDQGFRPSOHWHGDQLQYHVWRU

roadshow with Simon.

The second aspect consisted of an induction pack

of key corporate documents and information

relating to the Group, such as the latest Annual

5HSRUWDQG$FFRXQWVVWUDWHJ\SDSHUVWKHࢉYH\HDU

plan, mergers and acquisitions pipeline, the internal

audit plan and governance documents such as the

Articles of Association, Terms of Reference of the

&RPPLWWHHVDQGD'LUHFWRUVȆUHVSRQVLELOLWLHVEULHࢉQJ

KATE’S

INDUCTION

GOVERNANCE IN ACTION

KATE RINGROSE

CFO

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 86

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Governance code compliance continued

Compliance statement

7KH8.&RUSRUDWH*RYHUQDQFH&RGH

WKH&RGHDSSOLHGWRWKHࢉQDQFLDO\HDUHQGHG

0DUFK7KH&RGHLVSXEOLFO\DYDLODEOH

at www.frc.org.uk.

7KH&RPSDQ\FRQࢉUPVWKDWLWDSSOLHGWKH

principles and has complied with the

Provisions of the Code during 2023/24.

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.

Principles of the Code Page(s)

1. Board leadership and Company purpose

Chair’s introduction 4, 5 and 73

Our Board 74 and 75

Purpose, values and strategy 8 to 19

Culture 6, 18, 21 and

53 to 55

Board stakeholder engagement and decision making 80 to 82

.H\SHUIRUPDQFHLQGLFDWRUVDQGVWUDWHJLFSHUIRUPDQFH 20 to 23

Risk assessment 32

Risk management 32 to 37

Rewarding our people 57

Whistleblowing 60 and 98

2. Division of responsibilities

Our Board 74 and 75

Board leadership and governance framework 77 to 79

Board independence and time commitments 76 and 86

Committee reports 88 to 115

Board and Committee meeting attendance 76

Principles of the Code Page(s)

3. Composition, succession and evaluation

Our Board 74 and 75

Board leadership and governance framework 77 to 79

Board evaluation 84 and 85

Nomination Committee report 88 to 91

4. Audit, risk and internal controls

Audit Committee report 92 to 98

Statement of Directors’ responsibilities 119

Risk management 32 to 37

Principal risks and emerging risks 34 to 37

Going concern 39

Viability statement 38 and 39

5. Remuneration

Directors’ Remuneration report 99 to 115

Other remuneration disclosures 114 and 115

UK CORPORATE

GOVERNANCE CODE

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 87

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Nomination Committee report

NOMINATION

COMMITTEE

REPORT

Dear shareholder

I am pleased to present the Nomination

Committee’s (the Committee) report for the year

ended 31 March 2024. This section of the Annual

Report and Accounts details how the Committee

discharged its duties during the year, along with

its key activities.

'XULQJWKHࢉUVWSDUWRIWKH\HDUWKH&RPPLWWHH

focused its attention on the CFO recruitment after

David Egan stepped down from the Board. After

a rigorous selection process, Kate Ringrose was

DSSRLQWHG&)2ZLWKHࢆHFWIURP2FWREHU

Kate is a highly experienced CFO with a strong

WUDFNUHFRUGRIVXFFHVVIXOO\OHDGLQJࢉQDQFH

functions. In her role as CFO, Kate was

instrumental in the transformation of Centrica plc.

The Committee, along with the rest of the Board,

LVYHU\FRQࢉGHQWWKDW.DWHKDVWKHVNLOOVWRVXSSRUW

strongly the acceleration of the next stage of the

Group’s strategy. Full details of the CFO selection

SURFHVVFDQEHIRXQGLQWKHIROORZLQJSDJHV

I would like to thank Jane Titchener, who took up

the position of Interim CFO when David stepped

down and who has helped ensure a smooth

RQERDUGLQJIRU.DWH

Throughout the year, the Committee further

enhanced its work to strengthen talent mapping,

GHYHORSPHQWDQGVXFFHVVLRQSODQQLQJIRUERWK

the Executive Directors and senior leaders.

This has included consideration of shortlisted

individuals for appointment to the ExCo.

,QDGGLWLRQWRWKLVIXUWKHUZRUNKDVEHHQ

carried out in respect of Non-Executive Director

succession planning. Further details on this can

EHIRXQGRQSDJH

The Board places great emphasis on ensuring

LWVPHPEHUVKLSUHࢊHFWVGLYHUVLW\LQLWVEURDGHVW

sense. During the year, the Committee

recommended an updated Board D&I Policy,

ZKLFKZDVVXEVHTXHQWO\DGRSWHGE\WKH%RDUG

7KLVVHWVRXWWKHREMHFWLYHVIRU%RDUGPHPEHUVKLS

LQUHVSHFWRIGLYHUVLW\DORQJZLWKVSHFLࢉFWDUJHWV

IRUWKHVHQLRUPDQDJHPHQWDVUHࢊHFWHGLQWKH

Group’s D&I Policy. Further details on the Board

',3ROLF\FDQEHIRXQGRQSDJH

An internal Board evaluation was conducted

GXULQJWKH\HDUZLWKWKHSURFHVVEHLQJRYHUVHHQ

E\WKH&RPPLWWHH7KHࢉQGLQJVIURPWKH

HYDOXDWLRQZHUHEURDGO\SRVLWLYHZLWKVRPH

DUHDVRILPSURYHPHQWEHLQJLGHQWLࢉHG7KHVHZLOO

IRUPWKHEDVLVRIDQDFWLRQSODQZKLFKZLOOEH

implemented during the course of the year, with

oversight from the Committee. The Committee

DOVRFRQVLGHUHGWKHDFWLRQVLGHQWLࢉHGIURPWKH

2022/23 external evaluation and monitored

progress against these. Full details of the Board

evaluation process, outcomes and previous actions

FDQEHIRXQGRQSDJHVDQG

Rona Fairhead

Chair of the Nomination Committee

22 May 2024

KEY ACTIVITIES DURING THE YEAR

MAY

– Talent mapping and succession

planning for the CFO role

JUL

– Succession planning for key

senior leadership roles

– Recommendation of the

appointment of Kate Ringrose as

&)2DQGDPHPEHURIWKH%RDUG

– Non-Executive Director

succession planning

DEC

– Non-Executive Director

succession planning

MAR

– Internal Board evaluation

outcome

– Executive and Non-Executive

Director succession planning

– Review of Committee Terms

of Reference

Key highlights

Membership as at 22 May 2024

Rona Fairhead (Chair) Louisa Burdett

Navneet Kapoor Bessie Lee

David Sleath Joan Wainwright

RONA FAIRHEAD

CHAIR OF THE

NOMINATION COMMITTEE

Activities for 2023/24

– Oversight of CFO selection process

– Consideration of candidates for ExCo roles

– Enhancement of talent mapping, development

and succession planning

– Oversight of the Board evaluation process

Priorities for 2024/25

– Continued focus on improving the succession

planning process

– Continued focus on diversity and inclusion (D&I)

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 88

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Nomination Committee report continued

Board changes

As detailed in last year’s Annual Report and

Accounts, following the departure of Lindsley

Ruth as CEO, a rigorous selection process was

conducted for the role, which led ultimately to

WKHDSSRLQWPHQWRI6LPRQ3U\FHDV&(2HࢆHFWLYH

3 April 2023. For details of Simon’s selection

process, refer to page 101 of the Annual Report

and Accounts for the year ended 31 March 2023.

David Egan stepped down from the Board and his

UROHRI&)2ZLWKHࢆHFWIURP0D\DQG.DWH

5LQJURVHZDVDSSRLQWHGDV&)2IURP2FWREHU

.DWHȆVIXOOELRJUDSKLFDOGHWDLOVFDQEHIRXQG

on page 74.

Succession planning

1XUWXULQJWDOHQWLVDNH\HQDEOHUWRGHOLYHULQJRXU

EXVLQHVVVWUDWHJ\DQGFUHDWLQJDKLJKSHUIRUPDQFH

purpose-led culture.

With the appointment of Simon and Kate, along

ZLWKDQHZ&32UHQHZHGIRFXVKDVEHHQJLYHQ

to succession planning and talent development

within the Group. This has included a review of

work carried out in the last couple of years and

identifying areas for improvement. Our succession

planning process will evolve to strengthen

DFFRXQWDELOLW\IRUGHYHORSLQJNH\WDOHQWGULYHDQG

monitor more action-orientated outcomes and

develop a stronger and more diverse internal

pipeline of talent through accelerated

development and hiring.

Ensuring a clear connection between our

operating model and succession planning

A strategic review was conducted during the year

ZKLFKUHVXOWHGLQRXUQHZRSHUDWLQJPRGHOEHLQJ

adopted. This also includes three new roles on the

ExCo for the accelerator functions. A rigorous

process was undertaken to identify the leaders for

each of these new functions and we are proud that

HDFKKDVEHHQࢉOOHGE\LQWHUQDOWDOHQW7KHQHZ

PRGHOZDVHࢆHFWLYHIURP$SULO)XUWKHU

information regarding the operating model can

EHIRXQGRQSDJH

CFO SELECTION PROCESS

7KH&)2LVDWUXVWHGDQGVWUDWHJLFSDUWQHUWRWKH&(2DQGDNH\PHPEHURIWKH([&RDQGWKH%RDUG

:LWKWKLVLQPLQGWKH&RPPLWWHHGHYHORSHGDUROHSURࢉOHZKLFKZDVXVHGE\5XVVHOO5H\QROGV

Associates

(Russell Reynolds) to conduct the search. The essential skills and experience that the

&RPPLWWHHVSHFLࢉHGIRUWKHUROHRI&)2LQFOXGHGEULQJLQJࢉUVWFODVVEXVLQHVVDQGࢉQDQFLDOLQVLJKWV

FRPPHUFLDOLW\FRPPRQVHQVHDQGFUHDWLYLW\WRHQVXUHWKDWZKLOHWKHEXVLQHVVKDVVRXQGFRQWUROV

DQGUHSRUWLQJSURFHVVHVLWPD[LPLVHVYDOXHERWKIURPLWVRSHUDWLRQVDQGEDODQFHVKHHW,WZDVDOVR

HVVHQWLDOIRUWKHFDQGLGDWHWRKDYHWKHDELOLW\WRSDUWQHUZLWKWKH&(2DQG&32DVDFXOWXUDOHYROXWLRQ

OHDGHU$GLYHUVHORQJOLVWRIFDQGLGDWHVZHUHSURGXFHGEDVHGRQDJOREDOVHDUFKDQGXWLOLVLQJWKH

internal talent mapping already in place. Simon Pryce and Rona Fairhead worked with Russell Reynolds

WRUHGXFHWKHORQJOLVWGRZQWRDVKRUWOLVWLQFOXGLQJERWKLQWHUQDODQGH[WHUQDOFDQGLGDWHVEDVHGRQ

WKHLUVWURQJH[SHULHQFHDQGUHOHYDQWEDFNJURXQGV

7KHVKRUWOLVWHGFDQGLGDWHVZKRZHUHLGHQWLࢉHGDVWKHVWURQJHVWZHUHVXEMHFWWRIXOOSV\FKRPHWULF

DVVHVVPHQWVZLWK5XVVHOO5H\QROGVLQWHUYLHZHGE\WKH&(2DQG&KDLUDQGPHWZLWKRWKHUPHPEHUVRI

the Board and ExCo. Based on the outcome of the rigorous assessment and referencing process, Kate

ZDVLGHQWLࢉHGDVEHLQJWKHVWURQJHVWFDQGLGDWHIRUWKHUROHZLWKWKHVNLOOVWRZRUNZLWK6LPRQDQGWKH

ExCo to continue the Group’s strategic growth.

7KH5HPXQHUDWLRQ&RPPLWWHHPHWWRGHWHUPLQHWKHUHPXQHUDWLRQSDFNDJHWREHRࢆHUHGDQGKDYLQJ

EHHQDJUHHGWKH&RPPLWWHHPDGHWKHUHFRPPHQGDWLRQWRWKH%RDUGWRDSSRLQW.DWHDV&)2ZLWK

HࢆHFWIURP2FWREHU

1. Russell Reynolds has provided recruitment services for senior management positions during the year. There are no other connections

with it or the individual Directors.

Nurturing talent is a key enabler to delivering our

business strategy and creating a high-performance,

purpose-led culture.

,QRUGHUWRKHOSDFFHOHUDWHWKHHࢆHFWLYH

functioning of the executive team, each of

WKH([&RPHPEHUVKDYHXQGHUWDNHQ

externally-facilitated psychometric assessments to

improve their understanding of themselves and

HDFKRWKHU7KLVKDVKHOSHGWKH([&REXLOGDVWURQJ

team dynamic, with a clear understanding of their

SXUSRVHUHTXLUHGPDQDJHPHQWEHKDYLRXUV

and ways of working.

Our succession planning process

7KHUHLVDQDQQXDOSURFHVVZKHUHE\DOOLQGLYLGXDOV

throughout the Group undergo regular

SHUIRUPDQFHUHYLHZVDQGDUHUHVSRQVLEOHIRU

their own development plans, with oversight and

VXSSRUWSURYLGHGE\OLQHPDQDJHUV,QDGGLWLRQWR

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

SURJUDPPHVHHSDJH

2XUVXFFHVVLRQSODQQLQJFDQEHVSOLWLQWRWZRWLHUV

WKHࢉUVWIRUWKH([HFXWLYH'LUHFWRUSRVLWLRQVDQG

the second for key senior management roles.

7KHVXFFHVVLRQSODQVDUHVSOLWEHWZHHQVKRUWWHUP

DQGORQJWHUPUHTXLUHPHQWV

– 6KRUWWHUPUHTXLUHPHQWVIRUXVHLQXQSODQQHG

RUHPHUJHQF\VLWXDWLRQVZKHUHE\LQWHULPFRYHU

RQDVKRUWWHUPEDVLVLVLPSOHPHQWHG

– /RQJHUWHUPUHTXLUHPHQWVIRUFUHDWLQJDGLYHUVH

SLSHOLQHRIWDOHQWZLWKLQWKHRUJDQLVDWLRQE\

identifying individuals who have potential to

VWHSLQWRWKHUROHLQWKHQH[WRQHWRࢉYH\HDUV

Any gaps in experience and knowledge are

LGHQWLࢉHGDQGDGHYHORSPHQWSODQGHYLVHGDQG

implemented to upskill potential candidates.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 89

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Over the coming months, we will continue to align

the senior leadership teams to the new operating

model, and succession planning into the new roles

ZLOOEHUHYLHZHG7KLVZLOOEHFDUULHGRXWZLWKLQSXW

alignment and ownership from the ExCo. The

Committee will continue to review and monitor

the succession planning process to ensure it is

HࢆHFWLYHDQGDSSURSULDWHIRUWKH*URXS

Non-Executive Director succession planning

Throughout the year, the Committee continually

FRQVLGHUHGWKH%RDUGȆVEDODQFHRIVNLOOVDQG

experience to ensure the overall composition of

the Board remains appropriate. This approach also

HQDEOHVWKH&RPPLWWHHWRLGHQWLI\DQ\VNLOOVJDSV

DQGWREXLOGTXLFNO\UROHSURࢉOHVZKHQQHHGHG

Diversity and inclusion

The Committee has 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

ZRUNVLQFRQMXQFWLRQZLWKRXUZLGHU*URXS',

3ROLF\DQGUHࢊHFWVWKHRYHUDOO*URXSWDUJHWUDQJHV

for our senior leaders. For further details of

SHUIRUPDQFHDJDLQVWWDUJHWVVHHSDJH

Policy statement

:HEHOLHYHLQFUHDWLQJDQLQFOXVLYHDQGHQJDJLQJ

environment where everyone is proud and excited

WRFRPHWRZRUNDQGFDQSHUIRUPDWWKHLUEHVW

develop and thrive. We are proud to support our

SHRSOHWREHWKHLUEHVWE\EXLOGLQJDQLQFOXVLYH

workplace that supports everyone, irrespective of

HWKQLFLW\GLVDELOLW\VRFLRHFRQRPLFEDFNJURXQGV

mental health conditions, neurological divergence,

age, religion, sexual orientation or gender identity.

7KH&RPPLWWHHLVUHVSRQVLEOHIRUHQVXULQJWKDWWKH

%RDUGKDVWKHULJKWEDODQFHRIVNLOOVH[SHULHQFH

and knowledge and, in accordance with its Terms

RI5HIHUHQFHVKDOO

– Regularly review Board composition

– Monitor and drive succession planning, talent

GHYHORSPHQWDQGWKHEURDGHUDVSHFWVRI',

IRUERWK([HFXWLYH'LUHFWRUVDQGWKH([&R

– For any Director appointments, work with

H[HFXWLYHVHDUFKࢉUPVWKDWUHࢊHFWDQG

understand the Group’s values and approach

to diversity, including this Policy, and will honour

those values and approach in identifying and

SURSRVLQJVXLWDEOHFDQGLGDWHVIRUDSSRLQWPHQW

to the Board and its Committees

– ,GHQWLI\VXLWDEOHFDQGLGDWHVIRUDSSRLQWPHQW

WRWKH%RDUGRQPHULWDJDLQVWREMHFWLYHFULWHULD

KDYLQJUHJDUGWR

ੳ WKHEHQHࢉWVRIGLYHUVLW\LQSURPRWLQJWKHVXFFHVV

RIWKH*URXSIRUWKHEHQHࢉWRILWVVKDUHKROGHUVDV

a whole

ੳ WKHVNLOOVH[SHULHQFHEDFNJURXQGLQGHSHQGHQFH

DQGH[SHUWLVHRIFXUUHQWPHPEHUVRIWKH%RDUG

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

RWKHUPDWWHUVDVUHTXLUHGE\WKH&RGHDQG

RWKHUUHJXODWRU\DQGVWDWXWRU\UHTXLUHPHQWV

– Review the Board D&I Policy at least annually

and recommend any revisions to the Board

Nomination Committee report continued

5HࢊHFWLQJWKHVHDVSLUDWLRQVWKH%RDUGZLOODLPWR

PHHWDQ\UHFRPPHQGDWLRQVVHWRXWE\WKH)76(

Women Leaders review (formerly Hampton-

Alexander Review) and the Parker Review.

The Board places high emphasis on ensuring the

development of diversity in the senior leadership

roles across the Group and supports and oversees

WKH*URXSȆVDPELWLRQRIZRUNLQJWRZDUGVWR

RIVHQLRUOHDGHUVEHLQJZRPHQDQGWR

EHLQJHWKQLFDOO\GLYHUVHE\

Currently, this Policy is not applied to Board

Committees individually, although we strive

to apply similar representation across the

&RPPLWWHHV7KH%RDUGLVFRPIRUWDEOHWKDW

WKHGLYHUVLW\RIWKH%RDUGLVUHࢊHFWHGDFURVVWKH

&RPPLWWHHPHPEHUVKLSVDQGWKDWWKLVUHPDLQV

an ongoing consideration.

Responsibilities, monitoring and reporting

The Chair of the Board will lead the Board’s

GLYHUVLW\DJHQGDDQGVHWPHDVXUDEOHREMHFWLYHV

with the aim of continuously improving D&I

JHQHUDOO\XOWLPDWHO\OHDGLQJWREHWWHUGHEDWHDQG

decision making.

7KH%RDUGZLOOEHH[SHFWHGWRUROHPRGHO

LQFOXVLYHODQJXDJHEHKDYLRXUVDQGSUDFWLFHLQ

DOOXQGHUWDNLQJVIRUDQGRQEHKDOIRIWKH*URXS

setting a clear tone from the top.

The Board places great emphasis on ensuring that

LWVPHPEHUVKLSUHࢊHFWVGLYHUVLW\LQLWVEURDGHVW

VHQVH:HEHOLHYHDNH\GULYHULQGHOLYHULQJRXU

organisational diversity commitments is through

D%RDUGZKLFKKDVDEDODQFHRIVNLOOVSHUVRQDO

and cognitive strengths, experience, diversity,

independence and knowledge. Consideration

LVJLYHQWRWKHFRPELQDWLRQRIGHPRJUDSKLFV

skills, experience, ethnicity, age, gender and

RWKHUUHOHYDQWSHUVRQDODWWULEXWHVRQWKH%RDUG

to provide the range of perspectives, insights

and challenge needed to support good decision

making.

New appointments are made on merit, taking

DFFRXQWRIWKHVSHFLࢉFVNLOOVDQGH[SHULHQFH

independence and knowledge needed to ensure a

GLYHUVHDQGURXQGHG%RDUGDQGWKHEHQHࢉWVHDFK

FDQGLGDWHFDQEULQJWRWKHRYHUDOOFRPSRVLWLRQRI

the Board and its Committees.

Objectives

2EMHFWLYHVIRUDFKLHYLQJ%RDUGGLYHUVLW\DUH

periodically reviewed. The Board aspires to

EHFRPSULVHGRI

– $WOHDVWZRPHQ

– 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

EDFNJURXQGZLWKDWDUJHWRIE\WR

UHࢊHFWWKHRYHUDOO*URXSWDUJHWIRUVHQLRUUROHV

KHOGE\HWKQLFDOO\GLYHUVHH[HFXWLYHV

The Board acknowledges that in periods of Board

FKDQJHWKHUHPD\EHWLPHVZKHQWKLVEDODQFHLV

not maintained.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 90

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Nomination Committee report continued

The ﬁndings of the Committee’s

evaluation demonstrated that

itoperated effectively and

continues to discharge its duties.

Diversity statistics as at 31 March 2024

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

senior leaders

Percentage

of senior

leaders

Men 4  2  

Women  243

1RWVSHFLࢉHGSUHIHUQRWWRVD\ 00 00

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

senior leaders

Percentage

of senior

leaders

White British or other White

(including minority-white groups) 7  4  

Mixed / Multiple Ethnic Groups 0 0 0 3 

Asian / Asian British 2  07

%ODFN$IULFDQ&DULEEHDQ

Black British 0 0 0 0 

2WKHUHWKQLFJURXSLQFOXGLQJ$UDE 00 01

1RWVSHFLࢉHGSUHIHUQRWWRVD\ 00 0 

Methodology of data collection

Data in respect of our senior leaders is compiled

WKURXJKRXUHPSOR\HHGDWDEDVHDQGFROOHFWHGRQ

DVHOIUHSRUWLQJEDVLVRIVHQLRUOHDGHUV

VHOIUHSRUWHGHWKQLFLW\YLDWKLVGDWDEDVHLQFOXGLQJ

QRWVSHFLࢉHGSUHIHUQRWWRVD\DQGLGHQWLࢉHG

as non-white. Data in respect of the Board is

FROOHFWHGRQDVHOIUHSRUWLQJEDVLVDQGDJUHHG

GLUHFWO\ZLWKWKH%RDUGPHPEHUV

Board evaluation

7KH&RPPLWWHHOHGE\WKH&KDLURIWKH%RDUGLV

UHVSRQVLEOHIRURYHUVHHLQJWKH%RDUGHYDOXDWLRQ

process. This year the Board underwent an

internal evaluation.

The Committee also considered the remaining

DFWLRQVWDNHQLQUHVSRQVHWRIHHGEDFNIURPWKH

previous external review undertaken in 2022/23

and monitored progress against the agreed

DFWLRQV)XOOGHWDLOVRIERWKWKHHYDOXDWLRQDQG

actions against the previous year’s evaluation

DUHSURYLGHGRQSDJHVDQG

Committee governance

Committee structure and meetings

The Committee is comprised of independent

PHPEHUV7KHUHZHUHQRFKDQJHVWRWKH

&RPPLWWHHPHPEHUVKLSGXULQJWKH\HDU

The Committee held four scheduled meetings

during the year and held a further one

unscheduled meeting to consider the CFO

selection process and appointment. Details of

DWWHQGDQFHDWPHHWLQJVFDQEHIRXQGRQSDJH

,QDGGLWLRQWRWKHPHPEHUVWKHUHJXODUDWWHQGHHV

at the meetings of the Committee have included

the CEO, CFO, CPO and the Company Secretary.

The Committee Chair attends the Company’s AGM

DQGLVKDSS\WRDQVZHUDQ\TXHVWLRQVIURP

shareholders on matters falling within the

&RPPLWWHHȆVUHVSRQVLELOLWLHV

Meetings of the Committee generally take place

VKRUWO\EHIRUH%RDUGPHHWLQJVDQGDFWLYLWLHVRIWKH

&RPPLWWHHDUHUHSRUWHGE\WKH&KDLUWRWKH%RDUG

as a separate agenda item.

Committee responsibilities

7KH&RPPLWWHHȆVFKLHIUHVSRQVLELOLWLHVKDYHQRW

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.

7KHVHDUHDYDLODEOHDWrsgroup.com.

Committee evaluation

As part of the internal evaluation, the Committee

examined its own performance and operational

HࢆHFWLYHQHVV7KH&RPPLWWHHPHPEHUVDJUHHG

WKDWWKHPHHWLQJVFRQWLQXHGWREHZHOOUXQ

with appropriate levels of detail presented.

All respondents felt well informed and involved

LQWKHVSHFLࢉFDWLRQDQGDSSURDFKWRWKH

recruitment activity which occurred during the

\HDU$VUHSRUWHGRQSDJHWKHUHZDVVWURQJ

IHHGEDFNLQUHVSHFWRIWKHQHHGWRSURYLGHJUHDWHU

focus on succession planning in the coming year.

7KHRYHUDOOࢉQGLQJVRIWKHHYDOXDWLRQ

demonstrated that the Committee operated

HࢆHFWLYHO\DQGFRQWLQXHVWRGLVFKDUJHLWVGXWLHV

in line with its Terms of Reference.

Gender and ethnicity representation

The FCA, in its capacity as the UK Listing Authority,

LQWURGXFHGQHZUXOHVGXULQJWKDWUHTXLUH

OLVWHGFRPSDQLHVWRSXEOLVKLQIRUPDWLRQRQJHQGHU

and ethnic representation on the Board and in

H[HFXWLYHPDQDJHPHQWUROHV/57KLV

LVRXUࢉUVW\HDUUHSRUWLQJLQIXOODJDLQVWWKHVH

UHTXLUHPHQWV7KHWDEOHVEHORZRXWOLQHWKHFXUUHQW

gender and ethnic diversity of the Board and our

senior leaders.

Definition of senior leader

Permanent and temporary employees who

operate at a senior level in the Group and typically,

DOWKRXJKQRWH[FOXVLYHO\DUHWKHPHPEHUVRI

ExCo and their direct reports (including directors

RIVXEVLGLDU\HQWLWLHV&RQWUDFWRUVDQGDJHQF\

VWDࢆDUHQRWLQFOXGHG,QIRXUWHPSRUDU\

employees (three female and one male) were also

H[FOXGHG,QREMHFWLYHWHUPVWKLVLVDQ\RQHLQDUROH

VL]HGDVD:LOOLV7RZHUV:DWVRQJOREDOJUDGHRI

RUDERYHRUHTXLYDOHQWLQQHZDFTXLVLWLRQV

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 91

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Audit Committee report

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 2024. The purpose of

WKLV5HSRUWLVWRGHVFULEHWKHZRUNXQGHUWDNHQE\

the Committee and explain how it has discharged

LWVUHVSRQVLELOLWLHVWKURXJKRXWWKH\HDU

The Committee’s main role is to monitor and

UHYLHZWKHLQWHJULW\RIWKH&RPSDQ\ȆVࢉQDQFLDO

information. This includes recommending to the

Board whether the Company’s Annual Report and

$FFRXQWVWDNHQDVDZKROHLVIDLUEDODQFHGDQG

XQGHUVWDQGDEOHDQGZKHWKHUWKHDVVHVVPHQWRI

the Group’s going concern assumptions and

ORQJHUWHUPYLDELOLW\DUHUHDVRQDEOH7KH

&RPPLWWHHLVDOVRUHVSRQVLEOHIRUSURYLGLQJ

assurance to the Board that the Group’s internal

FRQWUROVDQGULVNPDQDJHPHQWV\VWHPVDUHࢉW

for purpose and regularly reviewed, as well as

RYHUVHHLQJWKHHࢆHFWLYHQHVVDQGLQGHSHQGHQFH

of the external Auditors, including recommending

to the Board the approval of their fees and

DSSRLQWPHQWRQDQDQQXDOEDVLV3Z&ZHUHWKH

Company’s external Auditors for 2023/24 and

'HORLWWHZLOOEHWKH&RPSDQ\ȆVQHZH[WHUQDO

$XGLWRUVIRU

We continued to see professional, comprehensive

DQGUREXVWZRUNLQDOODUHDVZKLFKKDVPHDQWWKDW

WKH&RPPLWWHHKDVEHHQDEOHWRGLVFKDUJHLWV

REOLJDWLRQVVHDPOHVVO\WKURXJKRXWWKH\HDU

The Committee has continued to focus on the

*URXSȆVࢉQDQFLDOUHSRUWLQJLQFOXGLQJDSSURYLQJ

the disclosures in relation to geopolitical

uncertainties and climate change, impacts of

LQࢊDWLRQWKH*URXSȆVJRLQJFRQFHUQDQGYLDELOLW\

VWDWHPHQWVDQGWKH*URXSȆVXVHDQGGHࢉQLWLRQV

of alternative performance measures. The

Committee has continued to focus on the key

DFFRXQWLQJPDWWHUVVHWRXWRQSDJHVDQG

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

LWVࢉQDQFLDOSURFHVVHVDQGFRQWUROVIUDPHZRUN

This will stand it in good stead for complying with

the regulations coming out of the updated Code.

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 third

year of reporting the climate-related risks and

RSSRUWXQLWLHVLQUHODWLRQWRWKH*URXSȆVREOLJDWLRQV

XQGHU7&)'VHHSDJHVWR

As part of its duties, the Committee has continued

to review the Group’s information security and

data protection controls, further details of which

FDQEHIRXQGRQSDJH

2QEHKDOIRIWKH&RPPLWWHH,ZRXOGOLNHWRWKDQN

RXULQWHUQDODXGLWDQGࢉQDQFHWHDPVIRUWKHLU

FRQWULEXWLRQRYHUWKHSDVW\HDU,ZRXOGDOVROLNH

to add thanks to PwC for their role as the Group’s

$XGLWRUVVLQFHDQGVXEMHFWWRWKH$*0

vote, to welcome Deloitte.

,ZLOOEHDYDLODEOHDVXVXDODWWKLV\HDUȆV$*0WR

DQVZHUDQ\VKDUHKROGHUTXHVWLRQVLQUHODWLRQWR

audit matters.

Louisa Burdett

Chair of the Audit Committee

22 May 2024

We continue to monitor the Group’s progress on its internal controls

over ﬁnancial reporting programme to strengthen and formalise its

ﬁnancial processes and controls framework.”

Key highlights

Membership as at 22 May 2024

Louisa Burdett (Chair) Alex Baldock

Navneet Kapoor David Sleath

LOUISA BURDETT

CHAIR OF THE AUDIT COMMITTEE

Activities for 2023/24

– Oversight of the transition from

PricewaterhouseCoopers LLP (PwC) to

Deloitte LLP (Deloitte) as new external

$XGLWRUVIURP

– 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

– Continued its focus on development of the

Group’s information security strategy

– Reviewed the progress of the second phase

of the Group’s review of internal controls over

ࢉQDQFLDOUHSRUWLQJ,&)5

– Reviewed the fair value determination of the

DFTXLVLWLRQRI'LVWUHOHFFRPSOHWHGLQWKH\HDUDQG

WKHLQLWLDOLQWHJUDWLRQDQGHࢆHFWLYHQHVVRIUHFHQW

DFTXLVLWLRQVȆLQWHUQDOFRQWUROV\VWHPV

– Reviewed the Group’s ESG reporting approach,

including the update on its climate-related risks

and opportunities in relation to TCFD

Priorities for 2024/25

– Review the Group’s assessment of the impact

of the Financial Reporting Council’s (FRC)

updated UK Corporate Governance Code 2024

(the updated Code) in relation to internal controls

and any necessary changes to the Group’s ICFR

review and the extension to all material controls.

Continue to monitor the Group’s progress in

this review

– Continue to review risks and opportunities

for ongoing ESG reporting, including TCFD

– 5HYLHZWKHLQWHJUDWLRQRIWKHDFTXLVLWLRQ

DQGDVVHVVWKHLPSURYHPHQWLQWKHHࢆHFWLYHQHVV

of its internal control systems

– Monitor the transition to Deloitte as

external Auditors

Annual Report and Accounts for the year ended 31 March 2024 92

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

RS Group plc

Audit Committee report continued

KEY ACTIVITIES DURING THE YEAR

MAY

– 5HYLHZHGWKH\HDUHQGNH\DFFRXQWLQJMXGJHPHQWVDQGLVVXHVLQFOXGLQJWD[DQGDSSURYHGWKHLU

DFFRXQWLQJWUHDWPHQWYLDELOLW\DQGJRLQJFRQFHUQDQGIDLUEDODQFHGDQGXQGHUVWDQGDEOHFULWHULD

for recommendation to the Board

– Reviewed the TCFD report for its recommendation to the Board

– Recommended to the Board for approval the adoption of the Annual Report and Accounts for the year

ended 31 March 2023 and the full-year results announcement

– Reviewed non-audit fees and the Non-Audit Services Policy

– Recommended to the Board for approval the re-appointment of PwC as Auditors for 2023/24

– 5HYLHZHGXSGDWHVUHJDUGLQJRSHUDWLRQDODXGLWUHSRUWVLQIRUPDWLRQVHFXULW\DQGTXDUWHUO\ZKLVWOHEORZLQJ

JUL

– Reviewed Group Operational Audit remit and performance

– 5HYLHZHGWKHNH\DFFRXQWLQJMXGJHPHQWVDQGLVVXHV

– Quarterly review of non-audit fees completed

– Approved PwC’s audit plan for 2023/24

– 5HFHLYHGUHSRUWVIURPWKH'DWD3URWHFWLRQ2ࢇFHUDQGTXDUWHUO\ZKLVWOHEORZLQJUHSRUW

– Review of operational audit reports

– New external Auditors’ transition update received

– Reviewed the external Auditors’ performance

– Received an update on the ICFR programme

OCT

– 5HFHLYHGWKHKDOI\HDUNH\DFFRXQWLQJMXGJHPHQWVDQGLVVXHVLQFOXGLQJWD[DQGDSSURYHGWKHLU

DFFRXQWLQJWUHDWPHQWJRLQJFRQFHUQDQGIDLUEDODQFHGDQGXQGHUVWDQGDEOHFULWHULDIRUUHFRPPHQGDWLRQ

to the Board

– Reviewed the draft interim results for recommendation to the Board

– Quarterly review of non-audit fees completed

– 5HYLHZRIWKHRQERDUGLQJSODQIRUWKHQHZH[WHUQDO$XGLWRUV

– Reviewed PwC’s audit fees for 2023/24 and recommended their approval to the Board

– 5HYLHZHGXSGDWHVUHJDUGLQJRSHUDWLRQDODXGLWUHSRUWVLQIRUPDWLRQVHFXULW\DQGTXDUWHUO\ZKLVWOHEORZLQJ

FEB

– Received the Group Operational Audit update, reviewed the Group’s risk and control assessment and

DSSURYHGWKHRSHUDWLRQDODXGLWSODQ

– 5HYLHZHGWKHNH\DFFRXQWLQJMXGJHPHQWVDQGLVVXHV

– 2023/24 ESG reporting approach agreed, including TCFD actions and disclosure

– Received an update on emerging ESG reporting regulations

– ICFR update received, including a summary of the changes made to the updated Code in relation to

internal controls

– Quarterly review of non-audit fees completed

– 5HYLHZHGWKH$QWL%ULEHU\&RUUXSWLRQ3ROLF\DQGSURFHGXUHV

– 5HFHLYHGDUHSRUWIURPWKH'DWD3URWHFWLRQ2ࢇFHU

– 5HYLHZHGWKHDQQXDOZKLVWOHEORZLQJDUUDQJHPHQWVDQGWKHTXDUWHUO\ZKLVWOHEORZLQJUHSRUW

– New external Auditors’ transition update received

FAIR, BALANCED AND UNDERSTANDABLE

7KH%RDUGLVUHTXLUHGWRFRQࢉUPWR

the Company’s shareholders that the

Annual Report and Accounts, taken

DVDZKROHLVIDLUEDODQFHGDQG

XQGHUVWDQGDEOHDQGSURYLGHVWKH

necessary information and key

PHVVDJHVWRHQDEOHVKDUHKROGHUV

and other stakeholders to assess the

Group and the Company’s position,

SHUIRUPDQFHEXVLQHVVPRGHODQG

strategy. The Committee advises the

%RDUGRQZKHWKHUWKLVFRQࢉUPDWLRQ

FDQEHPDGHDQGWKH&RPPLWWHH

assesses whether it can make this

UHFRPPHQGDWLRQWRWKH%RDUGE\

IROORZLQJLWVUHJXODUUREXVWDSSURDFK

ZKLFKLV

– (QVXULQJUHJXODWRU\UHTXLUHPHQWV

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

PHVVDJHVZLWKDQHDUࢉQDOYHUVLRQ

provided to the Committee and Board

SULRUWRVLJQRࢆRIWKH$QQXDO5HSRUW

and Accounts.

– Assessing management’s fair,

EDODQFHGDQGXQGHUVWDQGDEOH

YHULࢉFDWLRQSURFHVVDQGUHYLHZLQJ

its results. This included a cascaded

VLJQRࢆDFURVVWKH*URXSWR

determine the accuracy, consistency

and clarity of the data, information

and language.

– Reviewing the use and disclosure of

alternative performance measures

DQGFRQࢉUPLQJLWVEHOLHIWKDWVHSDUDWH

GLVFORVXUHRIWKHVHPHDVXUHVHQDEOHV

readers of the Annual Report and

$FFRXQWVWRXQGHUVWDQGEHWWHUWKH

XQGHUO\LQJࢉQDQFLDODQGRSHUDWLQJ

performance of the Group. The

alternative performance measures

are consistent with prior years. The

GHࢉQLWLRQVDQGUHFRQFLOLDWLRQVRI

alternative performance measures

DUHVHWRXWLQ1RWHRQSDJHV

WR

– Ensuring that a thorough review of

the Annual Report and Accounts was

XQGHUWDNHQE\DOODSSURSULDWHSDUWLHV

including external advisors.

The Committee has reviewed the

Annual Report and Accounts for

the year ended 31 March 2024 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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 93

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Financial reporting

The primary role of the Committee in relation to

ࢉQDQFLDOUHSRUWLQJLVWRPRQLWRUWKHLQWHJULW\RIWKH

*URXSȆVSXEOLVKHGࢉQDQFLDOLQIRUPDWLRQLQFOXGLQJ

UHYLHZLQJLWVIXOO\HDUDQGKDOI\HDUࢉQDQFLDO

results. The Committee undertakes this with

ERWKPDQDJHPHQWDQG3Z&DQGFRQFHQWUDWHV

RQHQVXULQJFRPSOLDQFHZLWKWKHUHOHYDQWࢉQDQFLDO

DQGJRYHUQDQFHUHSRUWLQJUHTXLUHPHQWV7KH

Committee considers the principal accounting

policies that are used when preparing these

UHVXOWVDVZHOODVUHYLHZLQJWKHVLJQLࢉFDQW

DFFRXQWLQJLVVXHVDQGDUHDVRIMXGJHPHQWPDGH

DVQRWHGEHORZDQGRWKHUNH\DUHDVRIIRFXVDV

QRWHGRQSDJH$OVRWKLVLQFOXGHVWKHIDLU

EDODQFHGDQGXQGHUVWDQGDEOHUHYLHZDVGHVFULEHG

LQPRUHGHWDLORQSDJH7KH&RPPLWWHHUHFHLYHV

regular reports from the CFO and Group Financial

Controller to support this work.

Significant accounting issues and areas

of judgement

0DQDJHPHQWLVUHTXLUHGWRH[HUFLVHMXGJHPHQW

LQDQXPEHURIDUHDVZKHQSUHSDULQJWKH*URXS

accounts and the Company accounts. The

&RPPLWWHHIRFXVHVRQDQ\VLJQLࢉFDQWDUHDVRI

MXGJHPHQWWKDWPD\PDWHULDOO\LPSDFWWKH*URXSȆV

and Company’s reported results and assesses

and challenges, if necessary, whether these

MXGJHPHQWVDUHUHDVRQDEOHDQGDSSURSULDWH

The Committee also reviews the clarity and

transparency of the related disclosures.

7KHVLJQLࢉFDQWDFFRXQWLQJLVVXHVDQGDUHDVRI

MXGJHPHQWFRQVLGHUHGE\WKH&RPPLWWHHGXULQJ

the year, and how these were addressed, are set

out to the right.

Audit Committee report continued

6LJQLࢉFDQWDFFRXQWLQJLVVXHVDQGDUHDVRIMXGJHPHQW How the Committee addressed these matters and conclusions reached

5HWLUHPHQWEHQHࢉWREOLJDWLRQV

7KH*URXSKDVDPDWHULDOGHࢉQHGEHQHࢉWSHQVLRQVFKHPHLQWKH

8.DQGVPDOOHUGHࢉQHGEHQHࢉWVFKHPHVLQWKH5HSXEOLFRI,UHODQG

*HUPDQ\)UDQFHDQG,WDO\DQGDFRQWULEXWLRQEDVHGSHQVLRQVFKHPH

in Switzerland that guarantees a minimum rate of investment return

DQGVRLVDFFRXQWHGIRUDVDGHࢉQHGEHQHࢉWSHQVLRQVFKHPH$W

0DUFKWKHWRWDOQHWGHࢉFLWLQUHODWLRQWRWKHVHUHWLUHPHQW

EHQHࢉWREOLJDWLRQVZDVePLOOLRQePLOOLRQRI

ZKLFKWKH8.ZDVePLOOLRQePLOOLRQ.H\

MXGJHPHQWVDUHPDGHLQUHODWLRQWRWKHDVVXPSWLRQVXVHGZKHQ

YDOXLQJWKHUHWLUHPHQWEHQHࢉWREOLJDWLRQV6HH1RWHRQSDJHV

WR

6PDOOFKDQJHVWRWKHDVVXPSWLRQVXVHGWRYDOXHWKH8.UHWLUHPHQWEHQHࢉW

REOLJDWLRQSDUWLFXODUO\FKDQJHVLQERQG\LHOGVXVHGWRGHWHUPLQHWKHGLVFRXQWUDWH

FDQKDYHDVLJQLࢉFDQWLPSDFWRQWKHࢉQDQFLDOSRVLWLRQDQGUHVXOWVRIWKH*URXS

7KHDVVXPSWLRQVSXWIRUZDUGE\WKHDFWXDULHV+HDGRI*URXS3HQVLRQVDQG*URXS

)LQDQFLDO&RQWUROOHUZHUHUHYLHZHGE\WKH&RPPLWWHH7KH&RPPLWWHHDOVRUHYLHZHG

the external Auditors’ comparisons of the assumptions with those of other similar

VFKHPHV$IWHUGLVFXVVLRQWKH&RPPLWWHHDJUHHGWKHUHDVRQDEOHQHVVRIWKH

DVVXPSWLRQVXVHGLQYDOXLQJWKHUHWLUHPHQWEHQHࢉWREOLJDWLRQVDWWKHKDOI\HDU

and year end.

At the year end, the Audit Committee agreed with management’s decision to update

WKHLQࢊDWLRQUDWHVHQVLWLYLW\DQDO\VLVWRVKRZWKHLPSDFWRIDPRYHPHQWDVWKLV

LVFRQVLGHUHGWREHFXUUHQWO\DUHDVRQDEOHSRVVLEOHFKDQJH

Inventories valuation

Inventories represent a material proportion of the Group’s net

DVVHWV$W0DUFKWKH*URXSKDGePLOOLRQ

ePLOOLRQRILQYHQWRULHVRQWKHEDODQFHVKHHW-XGJHPHQWV

DUHPDGHLQHVWLPDWLQJWKHQHWUHDOLVDEOHYDOXHRILQYHQWRULHV

$W0DUFKLQYHQWRU\SURYLVLRQVZHUHePLOOLRQ

ePLOOLRQ6HQVLWLYLW\DQDO\VLVRQWKHDVVXPSWLRQVZDV

SHUIRUPHGZKLFKLQGLFDWHVWKDWDQ\UHDVRQDEO\OLNHO\FKDQJHLQ

DVVXPSWLRQVLQFOXGLQJWKHFXUUHQWJOREDOHFRQRPLFXQFHUWDLQW\DQG

longer-term impacts of climate change and environmental

regulations, is not expected to have a material impact on the current

QHWUHDOLVDEOHYDOXHRILQYHQWRULHV6HH1RWHRQSDJH

From an International Accounting Standard (IAS) 1 ‘Presentation of

)LQDQFLDO6WDWHPHQWVȆSHUVSHFWLYHWKHMXGJHPHQWVLQYROYHGLQ

HVWLPDWLQJWKHQHWUHDOLVDEOHYDOXHRILQYHQWRULHVGRQRWKDYHD

VLJQLࢉFDQWULVNRIUHVXOWLQJLQDPDWHULDODGMXVWPHQWWRWKHFDUU\LQJ

amount of inventories within the next year. However, the Committee

EHOLHYHVWKDWLQYHQWRULHVDQGWKHLUPDQDJHPHQWDUHVRFULWLFDOWRWKH

*URXSȆVRSHUDWLQJPRGHOWKDWDUHDVRIMXGJHPHQWLQLQYHQWRULHV

YDOXDWLRQDUHVLJQLࢉFDQWDQGUHTXLUHLWVSDUWLFXODUIRFXV

7KH*URXSHVWLPDWHVWKHQHWUHDOLVDEOHYDOXHRILQYHQWRULHVLQRUGHUWRGHWHUPLQH

WKHYDOXHRIDQ\SURYLVLRQUHTXLUHG7KHMXGJHPHQWVPDGHLQWKHPHWKRGRORJ\XVHG

WRHVWLPDWHWKHQHWUHDOLVDEOHYDOXHUHODWHWRWKHQXPEHURI\HDUVRIVDOHVWKHUHDUH

LQLQYHQWRULHVRIHDFKSURGXFWDQGWKHYDOXHUHFRYHUDEOHIURPWKHVHLQYHQWRULHV

7KHVHDVVXPSWLRQVDUHEDVHGRQUHFHQWH[SHULHQFHDQGNQRZOHGJHRIWKHSURGXFWV

RQKDQGDQGDUHUHYLHZHGUHJXODUO\7KHLPSDFWRIWKHFXUUHQWJOREDOHFRQRPLF

uncertainty and the longer-term impacts of climate change and environmental

regulations on these assumptions were considered and the assumptions were

DGMXVWHGZKHUHQHFHVVDU\WRHQVXUHWKH\UHPDLQDSSURSULDWH$OVRDGMXVWPHQWV

were made to take account of the continued slowdown in sales of electronics

SURGXFWVDQGVORZPRYLQJVLQJOHERDUGFRPSXWLQJSURGXFWVDQGWKHLULPSDFWRQ

WKHQHWUHDOLVDEOHYDOXH7KHODWHVWUHYLHZZDVSUHVHQWHGWRWKH&RPPLWWHHDQGLW

UHYLHZHGDQGDJUHHGWKHUHDVRQDEOHQHVVRIWKHDVVXPSWLRQV

With the increase in the inventory provision due to the continued slowdown in the

EXVLQHVVSXVKLQJLQYHQWRU\LQWRH[FHVVWKH&RPPLWWHHDJUHHGZLWKPDQDJHPHQWȆV

GHFLVLRQWRXSGDWHWKHVHQVLWLYLW\DQDO\VLVWRFRQVLGHUWKHLPSDFWRIUHDVRQDEO\OLNHO\

decreases as well as increases to provisions.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 94

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Going concern and viability statements

$VSDUWRIWKH&RPPLWWHHȆVUHVSRQVLELOLW\WR

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

DVVHVVPHQWRIWKH*URXSȆVORQJHUWHUPYLDELOLW\

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

JRLQJFRQFHUQEDVLVLQWKHKDOI\HDUUHVXOWV

The Committee also reviewed and agreed the

wording of the going concern statement and

recommended its approval to the Board.

)RUWKHYLDELOLW\VWDWHPHQWDQGJRLQJFRQFHUQ

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

RIVHYHUHEXWSODXVLEOHVWUHVVWHVWVDQGUHYHUVH

stress tests. The Committee reviewed the

outcomes of these stress tests and, as a result,

UHFRPPHQGHGWRWKH%RDUGWKDWLWLVDEOHWR

FRQࢉUPWKH*URXSȆVYLDELOLW\VWDWHPHQWDQGWKH

going concern statement. Details of these

VWDWHPHQWVFDQEHIRXQGRQSDJHVDQG

of the Strategic Report.

Other key areas of focus

7KH&RPPLWWHHDOVRUHYLHZVDQXPEHURIRWKHU

NH\DUHDVWKDWUHTXLUHPDQDJHPHQWWRH[HUFLVH

MXGJHPHQW7KHVHMXGJHPHQWVKDYHQRWKDGD

VLJQLࢉFDQWHࢆHFWRQWKHDPRXQWVUHFRJQLVHGLQWKH

accounts in the year ended 31 March 2024 nor are

WKH\VLJQLࢉFDQWHVWLPDWHVZKLFKKDYHDVLJQLࢉFDQW

ULVNRIUHVXOWLQJLQDPDWHULDODGMXVWPHQWWRWKH

carrying amounts of the Group’s assets and

OLDELOLWLHVZLWKLQWKHQH[W\HDU+RZHYHUWKH

Committee focuses on these areas to ensure these

MXGJHPHQWVDUHDOVRUHDVRQDEOHDQGDSSURSULDWH

DQGWRHQVXUHWKH\KDYHQRWEHFRPHVLJQLࢉFDQW

Audit Committee report continued

Other key area of focus How the Committee addressed these matters and conclusions reached

Fair values and goodwill on acquisition of businesses

7KH*URXSFRPSOHWHGWKHDFTXLVLWLRQRI'LVWUHOHFRQ-XQH

IRUFRQVLGHUDWLRQRIePLOOLRQ7KHSXUFKDVHSULFHDOORFDWLRQ

UHVXOWHGLQJRRGZLOORIePLOOLRQDQGRWKHULQWDQJLEOHDVVHWV

RIePLOOLRQ

Judgements are made in relation to the assumptions and data used

LQGHWHUPLQLQJWKHIDLUYDOXHVRIWKHLQWDQJLEOHDVVHWVDFTXLUHGDQG

WKHJRRGZLOODULVLQJ6HH1RWHRQSDJHVDQG

7KH*URXSUHYLHZHGWKHQHWDVVHWVDFTXLUHGLGHQWLI\LQJDQGIDLUYDOXLQJDOO

WKHDVVHWVDQGOLDELOLWLHV)RUODUJHUDFTXLVLWLRQVWKH*URXSHQJDJHVH[WHUQDO

SURIHVVLRQDODGYLVRUVIRUWKHLGHQWLࢉFDWLRQDQGFDOFXODWLRQRIIDLUYDOXHVRILQWDQJLEOH

DVVHWVZKLOHHQVXULQJWKDWWKHDVVXPSWLRQVDQGIRUHFDVWFDVKࢊRZVXVHGLQWKH

YDOXDWLRQPRGHOVDUHUHDVRQDEOH

The Committee reviewed the process, discussed it with management and the

external Auditors and assessed the results of the work undertaken. The Committee

FRQFOXGHGWKDWLWLVVDWLVࢉHGZLWKWKHIDLUYDOXHVDQGJRRGZLOODULVLQJRQDFTXLVLWLRQ

RIEXVLQHVVHV

Impairment of goodwill and other assets

7KHUHLVePLOOLRQRIJRRGZLOORQWKHEDODQFHVKHHWDW

0DUFKePLOOLRQ-XGJHPHQWVDUHPDGHLQ

relation to the assumptions used in the value-in-use models which

are used to assess impairment of goodwill and other assets when

WKHUHDUHLQGLFDWRUVWKDWWKH\PD\EHLPSDLUHG

The value of goodwill is reviewed regularly for impairment using value-in-use

PRGHOVXVLQJFDVKࢊRZVDQGGLVFRXQWUDWHVDVVHWRXWLQ1RWHRQSDJHVWR

7KH&RPPLWWHHUHYLHZVWKHVHLPSDLUPHQWWHVWVHYHU\\HDULQFOXGLQJWKHPDLQ

assumptions. These assumptions also include consideration of the impact of climate

FKDQJH7KH&RPPLWWHHDJUHHVZLWKWKHWHVWVȆFRQࢉUPDWLRQWKDWWKHUHUHPDLQV

DGHTXDWHKHDGURRPLQSODFHDQGQRLPSDLUPHQWSURYLVLRQLVUHTXLUHG

Other assets are regularly reviewed to ensure there are no indicators that they may

EHLPSDLUHG,IDQ\VLJQLࢉFDQWLPSDLUPHQWVDUHIRXQGWKH&RPPLWWHHZLOODOVRUHYLHZ

WKHVHLPSDLUPHQWWHVWVLQFOXGLQJWKHPDLQDVVXPSWLRQVFRQࢉUPLQJWKDWWKH

YDOXDWLRQLVUHDVRQDEOH

7KH&RPPLWWHHDOVRUHYLHZHGDQGDJUHHGZLWKWKHWUDGHUHFHLYDEOHLPSDLUPHQW

allowance and disclosure in Note 23 on pages 162 and 163.

7KHVHRWKHUNH\DUHDVRIIRFXVLQWKH\HDUZHUH

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 95

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Other matters

The Committee also carried out a range of other

DFWLYLWLHVLQUHODWLRQWRࢉQDQFLDOUHSRUWLQJGXULQJ

WKH\HDUZKLFKLQFOXGHG

– Reviewing the impact of amendments to

accounting standards adopted during the year

– 5HYLHZLQJWKHHࢆHFWLYHWD[UDWHMXGJHPHQWV

made in relation to the levels of tax contingencies

IRUSRWHQWLDOFKDOOHQJHVE\ORFDOWD[DXWKRULWLHV

DQGUHFRYHUDELOLW\RIORVVHVDQGUHOHYDQWGLVFORVXUHV

– Approving the restatement of the service

solutions disaggregation of revenue following

management’s review of what it classes as

service solutions

– Reviewing and agreeing the accounting

treatment and disclosure of any potential

SRVWEDODQFHVKHHWHYHQWVDWERWKWKHKDOI\HDU

and full year

– Agreeing with management’s assessment that

there are no indicators of impairment for the

LQYHVWPHQWVWKH&RPSDQ\KROGVLQLWVVXEVLGLDULHV

Internal control and risk management

The Vice President Group Operational Audit and

5LVN93$XGLWDQG5LVNSURYLGHVTXDUWHUO\UHSRUWV

to the Committee which cover the performance

of the Group’s system of internal controls and its

HࢆHFWLYHQHVVLQPDQDJLQJWKH*URXSȆVSULQFLSDO

risks and identifying any control failings or

weaknesses. These reports highlight matters

which might impact the delivery of the Group’s

NH\VWUDWHJLFREMHFWLYHVRUZKLFKLQGLFDWH

LPSURYHPHQWLVUHTXLUHGLQDQ\RIWKH*URXSȆV

processes or controls. The Committee carefully

FRQVLGHUVWKHVHࢉQGLQJVDQGGLVFXVVHV

appropriate actions where necessary.

An annual review of the Group’s risk management

SURFHVVHVLVXQGHUWDNHQE\WKH&RPPLWWHHDV

UHTXLUHGE\WKH&RGHWKH)5&*XLGDQFHRQ$XGLW

Committees and the recommendations of the FRC

Guidance on Risk Management, Internal Control

and Related Financial and Business Reporting.

These processes include material controls which

FRYHUࢉQDQFLDORSHUDWLRQDODQGFRPSOLDQFH

controls and risk management systems.

The outcomes of these reviews are shared

with the Board.

7KHVHLQFRPELQDWLRQZLWKRWKHUXSGDWHVWRWKH

Board on the Group’s principal risks, allowed the

%RDUGWRDVVHVVWKHHࢆHFWLYHQHVVRIWKH*URXSȆV

systems of internal control and residual risk prior

to making its statement in this Annual Report and

Accounts. Further information regarding the

*URXSȆVSULQFLSDOULVNVFDQEHIRXQGRQSDJHV

to 37 of the Strategic Report.

The internal control system and risk management

SURFHVVKDYHEHHQLQSODFHGXULQJWKH\HDUDQGXS

to the date of this Annual Report and Accounts. In

WKHHYHQWZHDNQHVVHVDUHLGHQWLࢉHGLQWKHLQWHUQDO

control system, plans for strengthening them are

put in place and then regularly monitored. All the

PRUHVLJQLࢉFDQWFRQWUROZHDNQHVVREVHUYDWLRQV

where noted, have actions and agreed timelines

assigned against them.

,QWHUQDOࢉQDQFLDOFRQWUROV

,QWHUQDOࢉQDQFLDOFRQWUROVDUHWKHV\VWHPVWKDW

the Group employs to support the Board in

GLVFKDUJLQJLWVUHVSRQVLELOLWLHVIRUࢉQDQFLDOPDWWHUV

DQGWKHࢉQDQFLDOUHSRUWLQJSURFHVVDVGHVFULEHG

RQSDJH

7KHPDLQHOHPHQWVLQFOXGH

– $VVHVVPHQWVE\LQWHUQDODXGLWRQWKH

HࢆHFWLYHQHVVRIRSHUDWLRQDOFRQWUROV

– 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

– :HHNO\PRQWKO\TXDUWHUO\DQGDQQXDOUHSRUWLQJ

F\FOHVLQFOXGLQJWDUJHWVDSSURYHGE\WKH%RDUG

and regular forecast updates

– /RFDOOHDGHUVKLSWHDPVUHYLHZLQJࢉQDQFLDOUHVXOWV

against forecast and agreed performance

metrics and targets with overall performance

UHYLHZHGDWUHJLRQEXVLQHVVDQG*URXSOHYHOV

– 6SHFLࢉFUHSRUWLQJV\VWHPVFRYHULQJWUHDVXU\

RSHUDWLRQVPDMRULQYHVWPHQWSURMHFWVDQGOHJDO

DQGLQVXUDQFHDFWLYLWLHVZKLFKDUHUHYLHZHGE\

WKH%RDUGDQGLWV&RPPLWWHHVRQDUHJXODUEDVLV

– :KLVWOHEORZLQJSURFHGXUHVDOORZLQJLQGLYLGXDOV

WRUHSRUWIUDXGRUࢉQDQFLDOLUUHJXODULWLHVDQG

other matters of concern

In 2021/22, in advance of the regulations arising

from the then Department of Business, Energy &

Industrial Strategy’s corporate reform, the Group

FRPPHQFHGDUHYLHZRILWV,&)57KHࢉUVWSKDVH

completed during 2022/23, was to assess the

*URXSȆVࢉQDQFLDOUHSRUWLQJFRQWUROVDQGLGHQWLI\

ZKDWLPSURYHPHQWVVKRXOGEHPDGH7KHVHFRQG

SKDVHWRDFWLRQWKHLPSURYHPHQWVUHTXLUHGWKHQ

started and continued into 2023/24, although at

DVORZHUSDFHGXHWRZDLWLQJIRUWKHSXEOLFDWLRQ

of the updated Code in January 2024 and the

Group’s review of its operating model. The goal

LVWRLPSURYHDQGEXLOGRQRXUH[LVWLQJࢉQDQFLDO

reporting controls focused on key areas. This will

EHH[WHQGHGWRRWKHUUHOHYDQWLQWHUQDOFRQWURO

DUHDVLPSDFWHGE\WKHXSGDWHG&RGHZKLFKZLOO

apply to the Group’s year ending 31 March 2027.

The Committee will continue to monitor the

Group’s progress.

Internal audit

The work of the internal audit function spans the

whole Group, including, as and when relevant,

DFTXLUHGEXVLQHVVHVDQGSURYLGHVLQGHSHQGHQW

DQGREMHFWLYHDVVXUDQFHRYHUWKH*URXSȆVV\VWHPV

RILQWHUQDOFRQWUROVWKURXJKDULVNEDVHGDSSURDFK

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

GHWHUPLQHGE\UHIHUHQFHWRWKH*URXSȆVRSHUDWLQJ

risks and strategy as well as geographic, functional

DQGH[WHUQDOULVNV7KH&RPPLWWHHUHYLHZV

– 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

WKHEXVLQHVVWHDPȆVUHVROXWLRQRIDQ\FRQWURO

LVVXHVLGHQWLࢉHG

– 7KHHࢆHFWLYHQHVVRIWKHLQWHUQDODXGLWIXQFWLRQ

The VP Audit and Risk has regular, open access to

the Committee Chair. Discussions focus on audit

planning and matters noted during internal audit

DVVLJQPHQWV2WKHUPHPEHUVRIWKH&RPPLWWHH

DUHDOVRDYDLODEOHDVUHTXLUHG7KH&RPPLWWHH

meets with the VP Audit and Risk without the

presence of management at least once a year.

Other activities

During the year, the Committee continued its focus

on enhancing the Group’s information security

strategy via regular updates from the Chief

,QIRUPDWLRQ6HFXULW\DQG&RPSOLDQFH2ࢇFHU

(CISO). These included updates on information

security risk assessments relating to our industrial

control systems, including improvement actions

ERWKXQGHUZD\DQGSODQQHG7HVWLQJRIDOORXU

SULPDU\GLVWULEXWLRQVLWHVKDVQRZEHHQFRPSOHWHG

DQGWKHSURMHFWZLOOVKRUWO\EHHQWHULQJLWVVHFRQG

SKDVHZKLFKLQFOXGHVGHࢉQLQJIXWXUHPRQLWRULQJ

solutions. Throughout the year, the Committee

DOVRUHFHLYHGXSGDWHVRQRWKHUVSHFLࢉFLQIRUPDWLRQ

security risks, upcoming regulatory changes and

improvement actions, including strengthening IT

access controls.

The Committee continued with its reviews of the

data protection compliance programme through

UHSRUWVIURPWKH'DWD3URWHFWLRQ2ࢇFHU7KH

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

'DWD3URWHFWLRQ2ࢇFHUKLJKOLJKWLQJRQJRLQJ

compliance work such as training, targeted training

for high risk teams and awareness campaigns to

HPEHGDFXOWXUHRISULYDF\E\GHVLJQDVZHOODV

assessments of the impact of material changes to

the Group’s operations on its handling of personal

GDWDVXFKDVVLJQLࢉFDQWFKDQJHVWRV\VWHPVDQG

LQWHJUDWLRQRIDFTXLVLWLRQVDQGPRQLWRULQJRI

changes in the regulatory environment.

The Committee received updates on current

and emerging ESG legislation during the year.

It discussed and agreed the ESG reporting

UHTXLUHPHQWVIRUDQGIXWXUH\HDUV

including Scope 3 emissions and additional

disclosures in the Group’s third TCFD report

included in this Annual Report and Accounts.

7KH&RPPLWWHHZDVFRPIRUWDEOHWKDWWKH

Audit Committee report continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 96

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

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.

External Auditors

Effectiveness, independence, tender and rotation

7KH&RPPLWWHHLVUHVSRQVLEOHIRUUHYLHZLQJWKH

SHUIRUPDQFHDQGHࢆHFWLYHQHVVRIWKHH[WHUQDO

Auditors, as well as their appointment and

remuneration.

A review of the external Auditors’ performance

DQGHࢆHFWLYHQHVVLVXQGHUWDNHQE\WKH&RPPLWWHH

each year. The review includes looking at

TXDOLࢉFDWLRQH[SHUWLVHUHVRXUFHVDQG

reappointment (where relevant) of the external

Auditors, as well as ensuring that no issues have

DULVHQZKLFKPLJKWDGYHUVHO\DࢆHFWWKHLU

LQGHSHQGHQFHDQGREMHFWLYLW\

7KHUHYLHZDOVRFRQVLGHUVKRZUREXVWWKH

H[WHUQDODXGLWKDVEHHQDVZHOODVWKHTXDOLW\RI

delivery. It also addresses the FRC’s Audit Quality

Inspection Report on PwC and Deloitte as well

DVDQ\IHHGEDFNUHFHLYHGIURPWKH*URXSȆV

senior managers.

The Committee assessed how well the external

Auditors have exercised professional scepticism

and whether they have provided an appropriate

degree of constructive challenge to management.

The Committee also considers the risk of the

external Auditors withdrawing from the market.

PwC demonstrated professional scepticism

and challenge on the valuation of inventories,

WKHDFTXLVLWLRQIDLUYDOXHVRI'LVWUHOHFWKH

UHFRYHUDELOLW\RIUHFHLYDEOHVDQGDVVXPSWLRQV

LQWKHJRLQJFRQFHUQDQGYLDELOLW\DVVHVVPHQWV

During the year, the Senior Statutory Audit Partner,

Sandeep Dhillon, or the Audit Director, together

ZLWKRWKHUUHOHYDQWDQGDSSURSULDWHPHPEHUV

of the PwC audit team, attended all of the

Committee’s meetings. In addition to PwC’s

DWWHQGDQFH-RQ7KRPVRQZKRZLOOEHWKH*URXSȆV

Senior Statutory Audit Partner from Deloitte also

DWWHQGHGPHHWLQJVIURP2FWREHURQZDUGVDV

part of the external Auditors’ transition planning

process. PwC provided reports and conclusions

RQWKH*URXSȆVNH\DFFRXQWLQJMXGJHPHQWV

internal control processes, Annual Report and

Accounts and half-year report.

Following an external tender process in 2014, PwC

was appointed as the Group’s external Auditors

ZLWKWKHLUࢉUVWDXGLWEHLQJWKH$QQXDO

Report and Accounts. In line with the Companies

Act 2006 and as detailed in the Annual Report and

$FFRXQWVWKH&RPSDQ\XQGHUWRRNDUREXVW

SXEOLFWHQGHUSURFHVVIRUWKHDXGLWRIWKH$QQXDO

Report and Accounts for the year ending

0DUFK$VDUHVXOWRIWKLVWKH&RPPLWWHH

recommended to the Board that either PwC or

'HORLWWHZLWKDSUHIHUHQFHIRU'HORLWWHEH

DSSRLQWHGDVWKHH[WHUQDO$XGLWRUVIRU

The Board accepted this recommendation and

SUHIHUHQFHDQGDUHVROXWLRQZLOOWKHUHIRUHEHSXW

to shareholders at the forthcoming AGM to

appoint Deloitte.

Further details of how the Committee and the

external Auditors work together, as well as how

the external Auditors’ independence is maintained,

FDQEHIRXQGLQWKHJRYHUQDQFHVHFWLRQRIRXU

ZHEVLWH$VLQSUHYLRXV\HDUVȆUHSRUWVWKH

&RPPLWWHHFDQFRQࢉUPWKDWWKH*URXSGRHVQRW

engage PwC to undertake any work that could

DࢆHFWWKHLULQGHSHQGHQFH$VDUHVXOWRI'HORLWWHȆV

transition to external Auditors, Deloitte resigned

during the year from all non-audit work it provided

to the Group and so no longer undertakes any

ZRUNWKDWFRXOGDࢆHFWWKHLULQGHSHQGHQFH

7KH&RPPLWWHHKDVVDWLVࢉHGLWVHOIWKDWWKH

Company has complied with the provisions of the

Statutory Audit Services for Large Companies

Market Investigation (Mandatory Use of

Competitive Processes and Audit Committee

5HVSRQVLELOLWLHV2UGHUSXEOLVKHGE\

the Competition and Markets Authority on

6HSWHPEHU

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

H[WHUQDO$XGLWRUVȆLQGHSHQGHQFHRUREMHFWLYLW\DQG

that only permitted services are provided. In

determining this policy, the Committee took into

DFFRXQWSRVVLEOHWKUHDWVWRWKHH[WHUQDO$XGLWRUVȆ

LQGHSHQGHQFHDQGREMHFWLYLW\

7KHSROLF\RQQRQDXGLWVHUYLFHVLQFOXGHV

– In providing a non-audit service, the external

$XGLWRUVVKRXOGQRW

ੳ Audit their own work

ੳ Make management decisions for the Group

ੳ Create a mutuality of interest

ੳ Find themselves in the role of advocate for

the Group

– 7KHWRWDOQRQDXGLWIHHVIRUDQ\ࢉQDQFLDO\HDU

VKRXOGQRWH[FHHGRIWKHDYHUDJHRIWKH

external audit fee over the last three years.

In practice, the non-audit fees are normally

VLJQLࢉFDQWO\EHORZWKLVOHYHO

The policy also states that the Committee has

pre-approved the CFO to have authority to

commission the external Auditors to undertake

QRQDXGLWZRUNQRWFRYHUHGDERYHZKHUHWKHUH

LVDVSHFLࢉFSURMHFWZLWKDFRVWWKDWLVQRWH[SHFWHG

WRH[FHHGe

Full details of our policy in relation to non-audit

VHUYLFHVFDQEHIRXQGRQWKHJRYHUQDQFHVHFWLRQ

RIRXUZHEVLWH7KLVSROLF\ZDVUHYLHZHGE\WKH

Committee during the year and no changes

ZHUHUHTXLUHG

During the year under review there were

DXGLWUHODWHGDVVXUDQFHVHUYLFHVRIePLOOLRQ

and no other non-audit fees for PwC compared to

DXGLWIHHVRIePLOOLRQ)XUWKHULQIRUPDWLRQRQ

IHHVSD\DEOHWR3Z&DUHLQFOXGHGLQ1RWHRQ

page 140.

7KH&RPPLWWHHKDVVDWLVࢉHGLWVHOIWKDWLWVXVHRI

WKHH[WHUQDO$XGLWRUVFRPSOLHVZLWKERWKWKH&RGH

and the FRC’s Ethical and Auditing Standards

regarding the scope and level of non-audit work

DQGQRQDXGLWIHHVLQFXUUHGE\WKH*URXS

Fraud

7KH&RPPLWWHHLVUHVSRQVLEOHIRUUHYLHZLQJWKH

Group’s procedures for the prevention and

detection of fraud. Suspected cases of fraud must

EHUHSRUWHGWRWKH&RPSDQ\6HFUHWDU\RU*HQHUDO

&RXQVHOZLWKLQKRXUVDQGLQYHVWLJDWHGE\

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

FLUFXODWHGWRWKH%RDUGRQDUHJXODUEDVLVZLWK

the Committee also receiving regular updates.

7KH*URXSWDNHVVWHSVLQOLQHZLWKJRRGEXVLQHVV

practice to detect and prevent fraudulent activity,

DQGLVSUHSDULQJIRUWKHQHZUHTXLUHPHQWVRIWKH

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,

DOWKRXJKWKH*URXSLVVXEMHFWWRYDULRXV

attempts at external and low-level credit card

and online fraud.

Audit Committee report continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 97

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Whistleblowing

In accordance with the provisions of the

Committee’s Terms of Reference, the Committee

LVUHVSRQVLEOHIRUUHYLHZLQJWKHDUUDQJHPHQWV

ZKHUHE\DOORIWKH*URXSȆVHPSOR\HHVPD\LQ

FRQࢉGHQFHUDLVHFRQFHUQVDERXWLOOHJDOXQHWKLFDO

RULPSURSHUEHKDYLRXURURWKHUPDWWHUVDQGIRU

ensuring that these concerns are investigated and

HVFDODWHGDVDSSURSULDWH5HSRUWVPD\EHUDLVHG

directly to senior management or through an

H[WHUQDOWKLUGSDUW\UHSRUWLQJWRRO:KLVWOHEORZLQJ

LVUHIHUUHGWRLQWHUQDOO\DV6SHDN8SDQGLVDYDLODEOH

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

SURFHGXUHVDGRSWHGJOREDOO\KDYHEHHQ

XSGDWHGWRUHࢊHFWWKHRQJRLQJLPSOHPHQWDWLRQ

DFURVV(80HPEHU6WDWHVRIWKH(XURSHDQ

:KLVWOHEORZLQJ'LUHFWLYH7KH*URXSZLOOFRQWLQXH

to monitor any national laws that implement

DGGLWLRQDOUHOHYDQWUHTXLUHPHQWVDQGPDNHDQ\

UHTXLUHGFKDQJHVWRSROLFLHVDQGSURFHGXUHV

where appropriate. For further information

see page 60.

Committee governance

Committee structure and meetings

The Committee acts independently of

management to ensure the interests of our

shareholders are protected properly in relation

WRࢉQDQFLDOUHSRUWLQJULVNDQGLQWHUQDOFRQWURO

$OOPHPEHUVRIWKH&RPPLWWHHDUHLQGHSHQGHQW

1RQ([HFXWLYH'LUHFWRUVZLWKVXࢇFLHQWO\

ZLGHUDQJLQJEXVLQHVVH[SHULHQFHH[SHUWLVHDQG

FRPSHWHQFHWRHQDEOHWKH&RPPLWWHHWRIXOࢉOLWV

UHVSRQVLELOLWLHVHࢆHFWLYHO\7KHUHZHUHQRFKDQJHV

WRWKHPHPEHUVKLSRIWKH&RPPLWWHHGXULQJWKH

year. Louisa Burdett is a chartered accountant

DQGKDYLQJKHOGVHQLRUࢉQDQFLDOPDQDJHPHQW

positions, has extensive knowledge and

H[SHULHQFHRIࢉQDQFLDOPDUNHWVWUHDVXU\ULVN

PDQDJHPHQWDQGࢉQDQFLDODFFRXQWLQJVWDQGDUGV

%LRJUDSKLHVIRUWKH&RPPLWWHHPHPEHUVDUHVHW

RXWRQSDJHVDQG

The Committee held four scheduled meetings

during the year. Meetings were held in line with

WKHࢉQDQFLDODQGUHSRUWLQJF\FOHVRIWKH&RPSDQ\

Meetings are generally held prior to Board

PHHWLQJVVRWKDWRSWLPXPFROODERUDWLRQZLWK

the Board is maintained. The Committee Chair

provides updates to the Board on the proceedings,

FRQVLGHUDWLRQVDQGࢉQGLQJVRIHDFKPHHWLQJ

The Committee Chair extends invitations to certain

other key individuals to attend meetings, including

the Chair of the Board, other Non-Executive

'LUHFWRUVZKRDUHQRWPHPEHUVRIWKH&RPPLWWHH

the CEO, CFO, the Company Secretary, Group

Financial Controller, VP Audit and Risk and the

external Auditors. The CISO also attends to provide

regular updates on the Group’s Information

6HFXULW\VWUDWHJ\7KH'DWD3URWHFWLRQ2ࢇFHU

attends meetings twice a year to give updates

on data protection matters.

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

7KH&RPPLWWHHȆVFKLHIUHVSRQVLELOLWLHVKDYHQRW

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

DUHDYDLODEOHLQWKHJRYHUQDQFHVHFWLRQRIRXU

ZHEVLWHrsgroup.com.

7KHFRUHIXQFWLRQVRIWKH&RPPLWWHHLQFOXGH

– Supporting the Board in ensuring the integrity

RIWKHࢉQDQFLDODQGFRUSRUDWHUHSRUWLQJDQG

auditing processes

– Assisting the Board in assessing the long-term

YLDELOLW\RIWKH*URXSE\UHYLHZLQJDQG

challenging the scenarios considered and severe

EXWSODXVLEOHVWUHVVWHVWLQJSHUIRUPHGRQWKH

principal risks

– Advising the Board on whether the half-year and

IXOO\HDUࢉQDQFLDOUHSRUWVSUHVHQWDIDLUEDODQFHG

DQGXQGHUVWDQGDEOHDVVHVVPHQWRIWKH*URXSȆV

position and prospects

– (QVXULQJHࢆHFWLYHLQWHUQDOFRQWURODQGULVN

management systems are in place

– 0HDVXULQJWKH*URXSȆVHࢆHFWLYHQHVVLQ

managing risk and reviewing the risk

LGHQWLࢉFDWLRQSURFHVV

– Approving the remit of the internal audit function

DQGUHYLHZLQJLWVHࢆHFWLYHQHVVDQGࢉQGLQJV

– Ensuring that an appropriate relationship is

PDLQWDLQHGEHWZHHQWKH*URXSDQGLWVH[WHUQDO

Auditors, including the recommendation to the

Board to approve their appointment and fees

– Monitoring progress of the Group’s information

VHFXULW\VWUDWHJ\WRPLWLJDWHLWVPDMRUULVNV

– 5HYLHZLQJWKHVFRSHDQGHࢆHFWLYHQHVVRIWKH

external audit process

– 5HYLHZLQJZKLVWOHEORZLQJIUDXGDQWLEULEHU\DQG

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

WRRSHUDWHHࢆHFWLYHO\DQGSURYLGHGVXࢇFLHQW

challenge, and that the composition worked

ZHOOZLWKDJRRGEDODQFHRIH[SHULHQFH.H\

recommendations arising include launching a

FDPSDLJQWRUDLVHDZDUHQHVVRIWKHZKLVWOHEORZLQJ

hotline and its purpose and further enhancements

WR&RPPLWWHHSDSHUVWRLPSURYHWKHTXDOLW\DQG

shorten the length.

)XUWKHUGHWDLOVRIWKHHYDOXDWLRQSURFHVVFDQEH

IRXQGLQWKH*RYHUQDQFH5HSRUWRQSDJHV

DQG

Audit Committee report continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 98

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Simon Pryce Target: 400% of base salary

Owned Outright: 141%

Kate Ringrose Target: 400% of base salary

Owned Outright: 0%

Adjusted PBT Target: £359.1m

Maximum: £374.1m

Threshold: £339.1m

Actual: £280.5m

Outcome as % of maximum

Like-for-like revenue change Target: 1.0%

Maximum: 3.0%

Threshold: (2.0)%

Actual: (8)%

Adjusted free cash flow

Actual: £151.2m

Target: £197.4m

mum:

£207

Threshold: £177.4m

e reduction

Actual: 10%

Target: 5.5% Maximum: 8.0%

Threshold: 4.2%

Directors’ Remuneration report

REMUNERATION

AT A GLANCE

2023/24 PERFORMANCE

Like-for-like revenue change

(8)%

2022/23: 10%

$GMXVWHGSURࢉWEHIRUHWD[3%7

£281m

2022/23: £391m

$GMXVWHGHDUQLQJVSHUVKDUH(36

43.8p

2022/23: 63.6p

HUHGXFWLRQ6FRSHDQGHPLVVLRQV

10%

2022/23: 21%

5HWXUQRQFDSLWDOHPSOR\HG52&(

17.4%

2022/23: 30.8%

3HUIRUPDQFHPHDVXUHV

Simon Pryce Target: 10%

Actual: 10%

Kate Ringrose Target: 10%

Actual: 7.5%

Individual strategic targets

ALIGNMENT WITH BROADER EMPLOYEE REWARDS

100%

of employees are eligible to participate

in an incentive plan

10%

at least 10% of employees own

RS Group shares

Final annual incentive outcome

Simon Pryce Kate Ringrose

25% 22.5%

Underpin

adjustment

Underpin

adjustment

0% 0%

2024 SALARY INCREASES

Executive Director salaries

will increase by 3%

HࢆHFWLYH-XQH

UK employees will receive

an average pay increase of

HࢆHFWLYH-XQH

3.1%

employees globally will

receive an average pay

LQFUHDVHRILQ

2023/24 ANNUAL INCENTIVE OUTCOME

SHARE OWNERSHIP REQUIREMENTS

Owned outright Target

Simon Pryce and Kate Ringrose joined the Company on 3 April 2023 and

2 October 2023 respectively

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 99

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

REMUNERATION

COMMITTEE

REPORT

JOAN WAINWRIGHT

CHAIR OF THE REMUNERATION

COMMITTEE

Directors’ Remuneration report continued

Dear shareholder

On behalf of the Remuneration Committee (the

Committee), I am pleased to present the Directors’

Remuneration Report for the year ended

0DUFK

ZDVDFKDOOHQJLQJ\HDUIRUWKH*URXSZLWK

continued external headwinds and the unwinding

of the post-pandemic trading tailwinds. A summary

RIWKHࢉQDQFLDOSHUIRUPDQFHRIWKH*URXSLVVHW

RXWRQSDJHVWR:KLOHWKHࢉQDQFLDOUHVXOWV

were disappointing, we have strengthened and

empowered our ExCo to position the Company

for future success. Full details of the remuneration

outcomes are detailed on pages 106 and 107.

Consideration of the wider workforce

experience

:HFRQWLQXHWRHQVXUHUHPXQHUDWLRQRXWFRPHV

align with wider Company performance to drive

positive experiences for all our stakeholders.

The wellbeing of our people remains an ongoing

priority for the Group. Throughout the year we

helped support our people in various ways including:

– $FRPSHWLWLYHEDVHSD\LQFUHDVHLQ-XQH

(with an average UK increase of 5% for

management and 5.9% for non-management);

in countries where it was permitted, a higher

proportion of the available budget was awarded

to non-management employees to support

those impacted most heavily by the continued

KLJKLQࢊDWLRQDU\HQYLURQPHQW

– :HLQFUHDVHGWKHQXPEHURIHPSOR\HHV

participating in an incentive plan globally from

87% to 100% including extending the Group

Annual Incentive Plan to RS Integrated Supply

employees in the US, to align with their

colleagues in other geographies

– Granted RS YAY! Awards to all Risoul employees

employed on the date the Group acquired Risoul

– Enhanced our UK medical plan to include support

for menopause, fertility treatment and

neurodivergent conditions

– ([WHQGHGOLIHDQGDFFLGHQWLQVXUDQFHEHQHࢉWVWR

our employees in Australia and New Zealand,

DOLJQLQJZLWKWKHLU$VLD3DFLࢉFEDVHGFROOHDJXHV

There was a continued focus on promoting

VXVWDLQDEOHEHQHࢉWVLQFOXGLQJDࢊHHWRSHQGD\

in Corby, UK, demonstrating the range of vehicle

RࢆHULQJVDYDLODEOHDQGWKHEHQHࢉWVRIK\EULGDQG

electric vehicles over traditional fuel vehicles.

:HFRQWLQXHWROLVWHQWRRXUSHRSOHWRXQGHUVWDQG

KRZZHFDQLPSURYHRXUEHQHࢉWRࢆHULQJVWRUHࢊHFW

RXUGLYHUVHZRUNIRUFHDWGLࢆHUHQWOLIHVWDJHV

Our proposed base pay increases for our UK

HPSOR\HHSRSXODWLRQIRU-XQHLVH[SHFWHG

to be an average of 3%.

Sharing success

Giving our people a chance to share in our

collective success remains a priority through the

provision of incentive plans and all employee share

plans. Our senior leaders participate in Long Term

Incentive Plan (LTIP) programmes, with many also

EHLQJSDUWRIRXU-RXUQH\WR*UHDWQHVV/7,3$ZDUG

-*/7,3$ZDUGDQGWKHPDMRULW\RIRXUSHRSOH

continue to participate in the RS YAY! share award.

:HZLOOFRQWLQXHWRFRQVLGHURWKHUZD\VWRKHOS

our people share in our overall success including

reviewing the design of the Group Annual

Incentive and equity plans below executive level

and extending share purchase plans more broadly.

Consideration of shareholder feedback

The Committee noted that the 2023 Directors’

Remuneration Report (2023 DRR) received a vote

of more than 20% against at the 2023 AGM. For

many years, the Company has been committed

to an ongoing dialogue with shareholders on the

issue of executive remuneration. Prior to the 2022

AGM, at which the current Policy was approved, we

conducted an extensive multi-phased shareholder

consultation process, which helped to shape the

ࢉQDOSURSRVDOV:HDFNQRZOHGJHGDWWKDWWLPH

that some had concerns around the potential

PD[LPXPTXDQWXPDYDLODEOHXQGHUWKH-*/7,3

Award, but concluded that implementation was

supported by the majority of major shareholders

and was in the best interests of the Company and

its stakeholders.

Activities for 2023/24

– 5HYLHZHGDQGDOLJQHGUHPXQHUDWLRQ

outcomes with Company performance

– Approved remuneration structure for the CFO,

Kate Ringrose, and ExCo members

– Consideration of future reward framework

– Appointed a new remuneration advisor, Alvarez

& Marsal (A&M)

– Continued commitment to shareholder

engagement and review of shareholder feedback

3ULRULWLHVIRU

– Review of the Remuneration Policy (Policy) in

readiness for implementation of new Policy in

2025; early engagement with key stakeholders

on proposed changes

– Ensuring that both short and long-term incentive

GHVLJQDQGRXWFRPHVFRQWLQXHWRUHࢊHFWWKH

performance of the Company, the experience

of all our stakeholders and support delivery of

the strategy

– Refresh the Company reward philosophy to

underpin the Company strategy and values

– Aligning the employee global recognition

programme with the new Company values

– Maintaining an active and open dialogue with

shareholders and ensuring their views are

sought and considered when determining

executive remuneration

Key highlights

0HPEHUVKLSDVDW0D\

-RDQ:DLQZULJKW&KDLU Alex Baldock

Louisa Burdett David Sleath

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 100

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Directors’ Remuneration report continued

In order to align our incoming CEO, Simon Pryce,

with the remuneration structure in place for the

rest of the management team (and also the wider

HPSOR\HHSRSXODWLRQ6LPRQZDVJUDQWHGD-*

LTIP Award on appointment in April 2023. This

was reduced on a pro-rata basis and based on

the same exceptionally stretching performance

WDUJHWV:HHQJDJHGZLWKRYHURIRXU

shareholder register in advance of the 2023

AGM and, while most of our largest shareholders

were supportive, we recognise and acknowledge

WKDWVRPHVKDUHKROGHUVDQGDQLQࢊXHQWLDOYRWLQJ

advisory body, were not supportive of this

approach. The Committee also acknowledges

that certain votes against the 2023 DRR were

based on concerns around the exit arrangements

for the former CFO, David Egan.

Since the 2023 AGM, we have conducted a further

round of engagement, writing to our largest

30 shareholders, representing over 81% of the

UHJLVWHU:HUHFHLYHGDVPDOOQXPEHURIUHVSRQVHV

LQHDFKFDVHZHOFRPLQJWKHRࢆHUWRHQJDJHEXW

noting that it was not felt to be necessary given

the extensive prior consultation referred to on

page 100. It should also be noted that our new

&)2.DWH5LQJURVHGRHVQRWSDUWLFLSDWHLQWKH-*

LTIP Award, as she joined after the agreed deadline

IRUSDUWLFLSDWLRQDQGWKDW-*/7,3$ZDUGVWRRXU

former CEO and CFO lapsed in full on cessation

of their employment.

The Committee would like to thank our

shareholders who have engaged with us during

the year. The perspectives of our shareholders

form an important part of the Committee’s

deliberations and we reiterate our commitment to

this open dialogue, particularly as we develop our

2025 Remuneration Policy where our intention is

to continue to seek to drive strategic performance

and sustainable shareholder value through our

incentive programmes.

KEY ACTIVITIES DURING THE YEAR

MAY

– Approved the 2022/23 Annual Incentive and 2020 LTIP Award outcomes

– Set objectives for the coming year for the CEO

– Reviewed senior management pay outcomes

– Approved the remuneration package for the interim CFO

– Approved CEO and senior management 2023 share awards and approved the proposed awards for the ExCo

– Approved the grant of RS YAY! Awards to Risoul employees

– $SSURYHGWKH'55WREHSXWWRVKDUHKROGHUVDWWKH-XO\$*0

– Reviewed approach to the wider workforce remuneration for the year

JUL

– Approved the remuneration package for the new CFO

NOV

– Approved the appointment of A&M as the new independent advisor to the Committee

DEC

– Approved LTIP grants to eligible people who joined the Company in the period May to December 2023

– Considered the approach to reward for the wider workforce

– Reviewed the current status of share ownership of senior leaders

FEB

– Discussed the proposed refresh of the Group pay philosophy

– &RQVLGHUHGWKHSURSRVHG$QQXDO,QFHQWLYHDQG/7,3GHVLJQ

– Reviewed shareholder consultation during the year and considered further action

– 'LVFXVVHGWKH*HQGHU3D\*DSUHSRUW

– Received a market update from A&M

MAR

– 5HYLHZHGWKHLQLWLDOYLHZRIWKHRXWFRPHVIRUWKH$QQXDO,QFHQWLYHDQG/7,3DJDLQVWWKHSHUIRUPDQFHWDUJHWV

– $SSURYHGWKHSD\UHYLHZIRUWKH([HFXWLYH'LUHFWRUVDQG([&R

– $SSURYHGLQSULQFLSOH([HFXWLYH'LUHFWRU$QQXDO,QFHQWLYHDQG/7,3GHVLJQ

– Approved fees for the Chair of the Board

– 5HYLHZHGWKHࢉQDOGHVLJQRIWKH$QQXDO,QFHQWLYHDQGHTXLW\SODQVGHVLJQEHORZWKHH[HFXWLYHOHYHO

– Reviewed the proposed actions to address the Gender Pay Gap

– Reviewed the Terms of Reference for the Committee and the All Employee Share Plan Committee

– Reviewed the Committee evaluation outcome

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 101

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Directors’ Remuneration report continued

Incentive outcomes for the year

ended 31 March 2024

7KHDQQXDOLQFHQWLYHPHDVXUHVZHUH

adjusted PBT, like-for-like revenue change,

DGMXVWHGIUHHFDVKࢊRZDQG&2

e reduction

(Scope 1 and 2 emissions). Additionally, for the

ࢉUVWWLPH([HFXWLYH'LUHFWRUVKDGLQGLYLGXDO

VWUDWHJLFPHDVXUHVZLWKWDUJHWVVHWIRU

The formulaic incentive outcome for the year was

25% of maximum for Simon and 22.5% for Kate,

driven by the strong performance of the CO

reduction (Scope 1 and 2 emissions) and

achievement of their individual objectives,

ZKLFKDUHGHWDLOHGRQSDJH5HࢊHFWLQJRXU

established commitment to a high performance

culture, the incentive is subject to a robust

adjusted PBT underpin. As a result of the

challenging trading and market conditions, the

adjusted PBT underpin was not achieved and

therefore no incentive is payable to either of the

([HFXWLYH'LUHFWRUV)XUWKHUGHWDLORIWKHVSHFLࢉF

targets and the performance delivered are set out

on page 107.

Additionally, neither Simon nor Kate participated

in the 2021 LTIP Award and did not have an LTIP

award vest during the year. For reference, the 2021

LTIP Award which was based on performance over

WKHWKUHH\HDUVHQGHG0DUFKZLOOYHVWDW

50% of maximum. Full details are set on page 107.

The Committee believes in creating a

remuneration structure that incentivises and

rewards sustainable performance and that allows

us to attract and retain senior leaders globally

WRGHOLYHUWKH*URXSVWUDWHJ\HࢆHFWLYHO\7KH

Committee recognises that the zero-incentive

outcome for both of the Executive Directors

GRHVQRWUHࢊHFWWKHLUHࢆRUWVQRUWKHVLJQLࢉFDQW

underlying progress they have made in very

challenging market conditions. Therefore, while

the Committee has followed the Policy without

exercising discretion, it does not feel the

remuneration outcomes for the Executive

'LUHFWRUVUHࢊHFWWKHLUDFFRPSOLVKPHQWV

Remuneration arrangements

for Kate Ringrose

I would like to take this opportunity to welcome

Kate to the Group as CFO and an Executive

Director of the Board. Kate was appointed on

2 October 2023 and her remuneration package

was determined by the Committee in line with

our Policy, taking into account her experience

and background, the external environment and

appropriate market data.

Kate’s base salary on appointment, of £500,000,

UHࢊHFWHGKHUSUHYLRXVH[SHULHQFHDVD)76(

CFO, and her experience in helping to lead high

performance organisations that improve business

resilience, drive operational excellence and deliver

accelerated strategic growth. Additionally, the

Committee considered benchmarking data and

the remuneration of the prior CFO. Other aspects

of the package were in line with our Policy (as

VXPPDULVHGRQSDJHVDQGZLWKWKH

DQQXDOLQFHQWLYHRSSRUWXQLW\IRUWLPH

pro-rated from Kate’s start date.

The Committee carefully considered the approach

to compensating Kate 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 full details of these replacement share

awards can be found on page 109.

Kate is a great asset to the Group and the Board

and has the right leadership style and experience

to support Simon in leading the Group to future

VXFFHVVDVGHVFULEHGRQSDJH'HWDLOVRIWKH

CFO recruitment and selection process are set out

on page 89.

Remuneration approach for the year

ending 31 March 2025

Consistent with prior practice when reviewing base

pay for the Executive Directors, a combination of

performance, market position and relativity to

the wider workforce was considered. After careful

consideration it was agreed to award both Simon

and Kate a 3% increase to base salary in alignment

with the average expected for the UK wider

workforce. Other aspects of the package for

Executive Directors will be in accordance with

the Policy. The Annual Incentive will be based on

DEDODQFHGVHWRINH\ࢉQDQFLDODQGVWUDWHJLFWDUJHWV

for the year. The only change to the incentive

structure from last year is a minor re-balance

to the performance measures to increase the

ZHLJKWLQJRIWKHFDVKPHDVXUHUHࢊHFWLQJWKH

strategic prioritisation of cash management in the

current environment and reducing the weighting

on revenue. The LTIP structure will be consistent

ZLWKSULRU\HDUV:HZLOOFRQWLQXHWRVHWVWUHWFKLQJ

targets to reward sustainable, long-term growth.

Further details are set out on pages 105 and 106.

In addition, we will be transitioning from a

performance share to a restricted share LTIP

below the ExCo to incentivise performance and

drive retention in future policies.

Consistent with the approach taken for the

Executive Directors, the Committee also

determined that the Chair’s fees should be

increased by 2%. Full details are set out page 106.

Appointment of new Remuneration

Advisor

Deloitte LLP stepped down as the independent

remuneration advisor to the Committee in October

2023, following their appointment as the Group’s

new external Auditors. Following a robust tender

process, the Committee was pleased to appoint

A&M as the new advisor from November 2023.

Full details of the selection process can be found

RQSDJH

Looking forward

Later this year, we will commence the review of our

Remuneration Policy ahead of seeking shareholder

DSSURYDODWWKH$*0:HZLOOEHORRNLQJWR

ensure that the incentive structure allows us to

appropriately reward our Executive Directors for

the delivery of sustainable performance and

continued strategic execution in a challenging

H[WHUQDOPDUNHW:HZLOODOVRUHYLHZWKHTXDQWXP

of executive packages against evolving market

practice, to ensure we can secure the talent we

need to deliver our strategy, and address any

potential retention risks, in a highly competitive

global talent market. As ever, we plan to engage

widely with our shareholders and I look forward to

that consultation process later this calendar year.

I would like to thank our shareholders for the time

taken to engage with us during the year and their

continued support at the last AGM, as well as all

Committee members for their contribution during

the year. I hope that you will join the Board in

VXSSRUWLQJWKHUHVROXWLRQWRDSSURYHWKH

Remuneration Report to be put to shareholders at

WKH$*0

Joan Wainwright

Chair of the Remuneration Committee

22 May 2024

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 102

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Directors’ Remuneration report continued

SUMMARY OF THE

2022 REMUNERATION POLICY

2022 Remuneration Policy

7KH3ROLF\ZDVDSSURYHGE\VKDUHKROGHUVDWWKH$*0KHOGRQ-XO\DQGEHFDPHHࢆHFWLYHIURPWKDWGDWH$VXPPDU\RINH\WHUPVLQWKH3ROLF\LVVHWRXWEHORZDQGWKHIXOO3ROLF\DVDSSURYHGE\VKDUHKROGHUV

is available in the Corporate Governance section of our website at: rsgroup.com. Details of how the Policy has been applied during the year can be found throughout the Annual Report on Remuneration on

pages 105 to 115.

(OHPHQW Details

Salary

Established by considering scope and responsibilities of the role, skills and experience, scale and complexity of the Group, overall total compensation opportunity and competitive environment including

consideration of appropriate market data for companies of broadly similar size, sector and international scope to RS Group plc.

Salary increases will normally be based on the same framework which applies across the UK employee population.

Pension and benefits

Pension allowance aligned with the prevailing rate for the majority of the wider UK employee population (currently 10.5% of base salary).

2WKHUEHQHࢉWVLQFOXGHDFRPSDQ\FDURUFDVKDOORZDQFHLQOLHXDQGPHGLFDOLQVXUDQFH

([HFXWLYH'LUHFWRUVGRQRWQRUPDOO\UHFHLYHWRWDOWD[DEOHEHQHࢉWVH[FHHGLQJRIEDVHVDODU\

Annual incentive

Maximum opportunity is 150% of base salary.

%DVHGRQࢉQDQFLDODQGVWUDWHJLFSHUIRUPDQFHPHDVXUHVZKLFKWKH&RPPLWWHHFRQVLGHUVWREHDOLJQHGWRWKHVWUDWHJ\DQGWKHFUHDWLRQRIVKDUHKROGHUYDOXH6XFKPHDVXUHVLQFOXGHUHYHQXHSURࢉWFDVK

ࢊRZ136DQG(6*UHODWHGPDWWHUV

Before any incentive may pay out, a threshold level of adjusted PBT must be achieved.

For threshold performance, the incentive pay out will normally be nil, but in no circumstances will it exceed 10% of the maximum opportunity. For target performance, the incentive pay out will be no

higher than 50% of the maximum opportunity.

The Committee has discretion to adjust the formulaic incentive outcomes (including down to zero) to ensure alignment of pay with performance and fairness to shareholders and participants.

One third of total incentive payment will be deferred as shares, which vest after two years.

Dividend equivalents may be payable on shares which vest and will be delivered in the form of shares.

Malus and clawback provisions apply.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 103

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Summary of the 2022 Remuneration Policy continued

(OHPHQW Details

LTIP award

7KHPD[LPXP/7,3DZDUGLQUHVSHFWRIDࢉQDQFLDO\HDUZLOOEHRIVDODU\

Awards vest after a performance period of three years, subject to the satisfaction of performance measures. The performance measures for awards are determined annually and will include metrics

OLQNHGWRSURࢉWDELOLW\VKDUHKROGHUYDOXHDQGFDSLWDOHࢇFLHQF\

A further holding period of two years will apply post vesting.

The level of vesting for threshold performance will be no higher than 25% of maximum.

$GGLWLRQDOO\IRUWKHDZDUGWRYHVWWKH&RPPLWWHHPXVWEHVDWLVࢉHGWKDWWKHUHKDVEHHQDVXVWDLQHGLPSURYHPHQWLQWKH&RPSDQ\ȆVXQGHUO\LQJࢉQDQFLDOSHUIRUPDQFH7KH&RPPLWWHHKDVGLVFUHWLRQWR

DGMXVWWKHIRUPXODLF/7,3RXWFRPHVLILWGRHVQRWUHࢊHFWDSSURSULDWHO\WKHXQGHUO\LQJSHUIRUPDQFHRYHUWKHSHULRGRULVQRWDSSURSULDWHLQWKHFRQWH[WRIFLUFXPVWDQFHVWKDWZHUHXQH[SHFWHGRU

unforeseen when awards were made.

Dividend equivalents may be payable on any shares vesting and will be delivered in the form of shares.

Malus and clawback provisions apply.

J2G LTIP Award

7KHPD[LPXP-*/7,3$ZDUGZKLFKPD\EHJUDQWHGRYHUWKHOLIHRIWKH3ROLF\LVRIVDODU\IRUHDFKRIWKH([HFXWLYH'LUHFWRUVRQDRQHRࢆEDVLV

7KH-*/7,3$ZDUGZLOOYHVWEDVHGRQWKHDFKLHYHPHQWRIH[FHSWLRQDOO\VWUHWFKLQJSHUIRUPDQFHWDUJHWVPHDVXUHGRYHUDSHUIRUPDQFHSHULRGRIWKUHH\HDUVWR0DUFK$IXUWKHUKROGLQJSHULRGRI

two years will apply post vesting.

The level of vesting for threshold performance is nil.

DGMXVWWKHIRUPXODLF-*/7,3$ZDUGRXWFRPHVLILWGRHVQRWDSSURSULDWHO\UHࢊHFWXQGHUO\LQJSHUIRUPDQFHRYHUWKHSHULRGRULVQRWDSSURSULDWHLQWKHFRQWH[WRIFLUFXPVWDQFHVWKDWZHUHXQH[SHFWHGRU

unforeseen when awards were made.

Dividend equivalents may be payable on any shares vesting and will be delivered in the form of shares.

Malus and clawback provisions apply.

$Q([HFXWLYH'LUHFWRUDSSRLQWHGGXULQJWKLV3ROLF\SHULRGPD\UHFHLYHD-*/7,3$ZDUGWRDOLJQZLWKRWKHUPHPEHUVRIWKH([&R7KH&RPPLWWHHZRXOGVHWDQ\DZDUGOHYHOZLWKGXHUHJDUGWRWKH

SURSRUWLRQRIWKH-*/7,3$ZDUGSHUIRUPDQFHSHULRGZKLFKKDGHODSVHGDWWKHWLPHRIDSSRLQWPHQW

Shareholding guidelines

([HFXWLYH'LUHFWRUVDUHH[SHFWHGWREXLOGXSDQGUHWDLQDSHUVRQDOKROGLQJLQ56*URXSSOFVKDUHVRIRIVDODU\7KHUHLVDQH[SHFWDWLRQWKDW([HFXWLYH'LUHFWRUVUHWDLQDWOHDVWRIDQ\YHVWHG

share awards until this guideline is met.

Post-employment

shareholding requirement

([HFXWLYH'LUHFWRUVPXVWUHWDLQDSHUVRQDOKROGLQJLQ56*URXSSOFVKDUHVIRUDWZR\HDUSHULRGSRVWFHVVDWLRQRIHPSOR\PHQW7KLVPXVWEHHLWKHUHTXDOWRWKHLQHPSOR\PHQWJXLGHOLQHRULI

lower, the actual shareholding at the date of cessation of employment.

7KHDFWXDOVKDUHKROGLQJDWFHVVDWLRQLQFOXGHVRQO\VKDUHVZKLFKKDYHYHVWHGRUDUHLQDGHIHUUDORUKROGLQJSHULRGRQDQHWRIWD[EDVLVIURPDVKDUHDZDUGZKLFKZDVJUDQWHGDIWHUWKHHࢆHFWLYHGDWHRI

the 2022 Remuneration Policy.

Directors’ Remuneration report continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 104

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Directors’ Remuneration report continued

Remuneration Policy implementation for the year ending 31 March 2025

Executive Directors

Base salary

%DVHVDODU\IRUWKH([HFXWLYH'LUHFWRUVHࢆHFWLYHIURP-XQHDUHVKRZQEHORZ

Base salary

effective

1 June 2024

Base salary

on appointment

Change

Simon Pryce £772,697 £750,191 3%

Kate Ringrose £515,000 £500,000 3%

 7KHVDODULHVIRU6LPRQ3U\FHDQG.DWH5LQJURVHZHUHHࢆHFWLYHIURPWKHLUUHVSHFWLYHVWDUWGDWHV$SULODQG2FWREHU

:KHQXQGHUWDNLQJLWVUHYLHZRIWKH([HFXWLYH'LUHFWRUVȆEDVHVDODULHVWKLV\HDUWKH&RPPLWWHHFRQVLGHUHG

a combination of performance, market position and relativity to the wider workforce. After careful

consideration it was agreed to award both Simon and Kate a 3% increase to base salary in recognition

of their strong performance and in alignment with the average expected for the wider UK workforce.

Benefits

%HQHࢉWVZLOOEHSURYLGHGLQDFFRUGDQFHZLWKWKH3ROLF\7KHUHDUHQRFKDQJHVLQEHQHࢉWVFRPSDUHGWRWKH

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.

7KHDQQXDOLQFHQWLYHZLOOEHEDVHGRQDEDODQFHGVHWRINH\ࢉQDQFLDODQGVWUDWHJLFWDUJHWVIRUWKH\HDUDV

set out below:

Performance measure Weighting

Adjusted PBT 30%

$GMXVWHGIUHHFDVKࢊRZ 30%

Like-for-like Group revenue change 15%

e reduction (Scope 1 and 2 emissions) 15%

Individual strategic targets 10%

The measures remain consistent with prior years, with an adjustment to weightings to increase focus on

FDVKWRUHࢊHFWWKHVWUDWHJLFSULRULWLVDWLRQRIFDVKPDQDJHPHQWLQRXUFXUUHQWHQYLURQPHQWDQGUHGXFLQJ

WKHZHLJKWLQJRQUHYHQXH7KHVSHFLࢉFWDUJHWVDUHFRQVLGHUHGFRPPHUFLDOO\VHQVLWLYHDVWKH\PD\UHYHDO

information that damages our competitive advantage. Accordingly, they will not be disclosed in advance

but, to the extent the Directors consider them to be no longer sensitive, will be disclosed retrospectively

in the annual report on remuneration for the relevant year.

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.

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 Deferred Share Bonus Plan (DSBP).

2024 LTIP Award

%RWK6LPRQ3U\FHDQG.DWH5LQJURVHZLOOEHJUDQWHGD/7,3$ZDUGRIRIVDODU\LQDFFRUGDQFH

with the Policy.

The performance measures of adjusted EPS and total shareholder return (TSR) are consistent with the prior

year. The bespoke TSR peer group of 16 of the Group’s global peers (as set out below) will remain unchanged.

Vesting of these awards will be determined in accordance with the following performance targets

measured over the three years ending 31 March 2027.

Measure Weight

Threshold

(25% of max)

Maximum

(100% of max)

Adjusted EPS CAGR (three-year CAGR of the 2026/27

DGMXVWHG(36FRPSDUHGZLWKWKHDGMXVWHG(36

50% 5% 10%

TSR (vs industrial / electronic peer group)

1,2

50% Median Upper

Quartile

52&(DYHUDJHRI

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 ABB, Arrow Electronics, Avnet, Bunzl, Datwyler, Essentra, Fastenal, Ferguson, MSC Industrial Direct, Rexel,

5RFNZHOO6FKQHLGHU6LHPHQV7(&RQQHFWLYLW\:(6&2,QWHUQDWLRQDODQG::*UDLQJHU

3. The ROCE underpin has been set at a reduced level from prior years to adjust for the impact of the Risoul and Distrelec acquisitions.

ANNUAL REPORT

ONREMUNERATION

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 9.8.6R. The Annual Report on Remuneration will be

put to an advisory shareholder vote at the forthcoming AGM.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 105

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

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 ROCE underpin has been set at a lower level than the

prior year award, to adjust for the impact of recent acquisitions.

The award will be subject to a post-vesting holding period of two years.

All employee share plans

([HFXWLYH'LUHFWRUVFDQSDUWLFLSDWHLQDQ\DOOHPSOR\HHVKDUHVFKHPHVRࢆHUHGWRDOOHPSOR\HHVRQ

identical terms, with the exception that they are not able to participate in the all employee RS YAY! Award.

Chair and Non-Executive Directors

Following a review, the fees for the Chair and Non-Executive Directors will be increased by 2%. The pay

LQFUHDVHVIRU8.HPSOR\HHVDUHH[SHFWHGWREHDQDYHUDJHRI:LWKHࢆHFWIURP$SULOWKH&KDLUȆV

IHHVLQFUHDVHGIURPeWReDQGWKH1RQ([HFXWLYH'LUHFWRUVȆIHHVZHUHLQFUHDVHGIURP

£66,601 to £67,935. The additional fees for the Audit and Remuneration Committee Chairs and Senior

Independent Director (£15,000) and roles in respect of employee engagement (£5,000) remain unchanged.

Implementation of Executive Director 2022 Remuneration Policy for the year ended

31 March 2024

Single figure for total remuneration for Executive Directors (audited)

7KHIROORZLQJWDEOHSURYLGHVDVLQJOHࢉJXUHIRUWRWDOUHPXQHUDWLRQRIWKH([HFXWLYH'LUHFWRUVIRUWKH

\HDUHQGHG0DUFKDQGWKHSULRU\HDU7KHYDOXHRIWKHDQQXDOLQFHQWLYHLQFOXGHVWKHHOHPHQW

of incentive deferred under the DSBP, where relevant.

Simon Pryce Kate Ringrose David Egan

2024

2023 2024

2023

Base salary £749,383 – £250,000 – £45,138 £469,235

Double hatting allowance

––– ––£82,051

7D[DEOHEHQHࢉWV

£17,169 – £7,323 – £1,538 £15,970

3HQVLRQEHQHࢉW



£78,770 – £26,250 – £4,740 £60,673

7RWDOࢉ[HG £845,322 – £283,573 – £51,416 £627,929

Annual incentive

––– ––£300,694

LTIP

6, 8

––£89,397 ––£544,806

SAYE award discount

£4,606 – £4,606 –––

Total variable £4,606 – £94,003 ––£845,500

Total £849,928 – £377,576 – £51,416 £1,473,429

 7KHWRWDOUHPXQHUDWLRQIRU'DYLG(JDQLQGHWDLOVKLVDFWXDOHDUQLQJVXSWR0D\ZKHQKHVWHSSHGGRZQDV&)2DQG

DVD'LUHFWRURIWKH%RDUG7KHWRWDOUHPXQHUDWLRQIRU6LPRQ3U\FHDQG.DWH5LQJURVHUHࢊHFWVWKHLUUHVSHFWLYHDSSRLQWPHQWGDWHV

of 3 April 2023 and 2 October 2023 and excludes Simon’s fees for the period of the year he was a Non-Executive Director, which are

detailed on page 110.

2. David Egan was paid a double hatting allowance of £200,000 per annum, pro rata for the period 3 November 2022 to 2 April 2023 for

acting in the role of CEO.

 7D[DEOHEHQHࢉWVFRQVLVWVRIPHGLFDOLQVXUDQFHFDUDOORZDQFHDQGSHUVRQDOIXHODOORZDQFHZKHUHUHFHLYHG

 6LPRQUHFHLYHGWKHDPRXQWVVKRZQDERYHDVDFDVKVXSSOHPHQWLQOLHXRISHQVLRQ.DWH5LQJURVHUHFHLYHGDFRQWULEXWLRQRIeWR

WKHGHࢉQHGFRQWULEXWLRQSHQVLRQSODQDQGUHFHLYHGDIXUWKHUeDVDFDVKVXSSOHPHQWLQOLHXRISHQVLRQ1R([HFXWLYH'LUHFWRU

KDVSURVSHFWLYHEHQHࢉWVXQGHUDGHࢉQHGEHQHࢉWSHQVLRQUHODWLQJWRTXDOLI\LQJVHUYLFH

5. Annual incentive shows the full value of the annual incentive in respect of each year. The incentive is subject to service conditions set

out in the Policy, which is available in the Corporate Governance section of our website at rsgroup.com)RUWKHIRUPXODLF

RXWFRPHRIWKHLQFHQWLYHKDVUHVXOWHGLQQRLQFHQWLYHEHLQJSDLGWR([HFXWLYH'LUHFWRUV)XUWKHUGHWDLORIWKHIRUPXODLF

outcome can be found on page 107. For 2022/23 David’s incentive was delivered without the share deferral element, the full detail

RIWKLVDZDUGFDQEHIRXQGRQSDJHRIODVW\HDUȆVUHSRUW

 7KH/7,3$ZDUGYDOXHIRUVKRZVWKHYDOXHRI'DYLG(JDQȆVDZDUGZKLFKYHVWHGRQ-XQH7KHYDOXHRIWKH/7,3

$ZDUGKDVEHHQUHVWDWHGEDVHGRQWKHVKDUHSULFHRQWKHGDWHRIYHVWLQJRIS7KHࢉJXUHLQFOXGHVGLYLGHQGHTXLYDOHQWVKDUHVRI

£26,620 to David Egan in respect of the shares vesting. The value of David’s award declined over the period between grant and vest by

eGXHWRVKDUHSULFHGHSUHFLDWLRQ

 7KH6DYH$V<RX(DUQ6$<($ZDUGGLVFRXQWLVWKHGLࢆHUHQFHEHWZHHQWKHJUDQWGDWHYDOXHSHUVKDUHDQGWKHH[HUFLVHSULFHWKH

exercise price was 562.00p.

 7KH/7,3$ZDUGYDOXHIRUVKRZVWKHYDOXHRIWKHUHVWULFWHGVKDUHVLJQRQDZDUGJUDQWHGWR.DWH5LQJURVHRYHUVKDUHVRQ

1RYHPEHU)XOOGHWDLOVRIWKHDZDUGFDQEHIRXQGRQSDJH

Directors’ Remuneration report continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 106

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Incentive outcomes for the year ended 31 March 2024 (audited)

Annual incentive in respect of performance for the year ended 31 March 2024

The performance measures, target ranges and performance against each of the measures for the

DQQXDOLQFHQWLYHDUHRXWOLQHGLQWKHWDEOHEHORZ7DUJHWHGSHUIRUPDQFHZDVFDOLEUDWHGWR

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.

%DVHGRQWKH*URXSȆVSHUIRUPDQFHLQDJDLQVWWKHWDUJHWVWKHIRUPXODLFRXWFRPHIRU6LPRQZDV

25% of maximum and Kate was 22.5% of maximum, driven by strong performance against the carbon

DQGLQGLYLGXDOVWUDWHJLFPHDVXUHV+RZHYHUUHࢊHFWLQJRXUFRPPLWPHQWWRDKLJKSHUIRUPDQFHFXOWXUH

the incentive is subject to a robust adjusted PBT underpin. As a result of the challenging trading and

market conditions, this underpin was not met and therefore no incentive was achieved by the Executive

Directors. In line with good practice and the terms of the Policy, the Committee considered this incentive

outcome in the context of business performance for the year in its broadest sense. This review considered

the resilience of delivery given the impact of ongoing external challenges, as well as the overall experience

RIDOOWKH*URXSȆVVWDNHKROGHUVDQGWKHLQWHQGHGSXUSRVHRIWKHDZDUG:KLOHWKH%RDUGIROORZHGWKH

3ROLF\LQIRUFHLWDFNQRZOHGJHGWKDWWKHUHPXQHUDWLRQRXWFRPHVIRU6LPRQDQG.DWHGLGQRWUHࢊHFWWKHLU

HࢆRUWVDQGDFFRPSOLVKPHQWV+RZHYHUWKH3ROLF\ZDVIROORZHGDQGQRGLVFUHWLRQKDVEHHQDSSOLHGWRWKH

Executive Director incentives. The Committee considered this to be appropriate. Further background on

ࢉQDQFLDODQGVWUDWHJLFSHUIRUPDQFHIRUWKH\HDUHQGHG0DUFKLVSURYLGHGLQWKH6WUDWHJLF5HSRUW

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)

Threshold 0.0% £339.1m £280.5m 0% 0%

Target 15.0% £359.1m

Maximum 30.0% eP

Like-for-like Group

revenue change

(30% weighting)

Threshold 0.0% (2.0)% (8)% 0% 0%

Target 15.0% 1.0%

Maximum 30.0% 3.0%

$GMXVWHGIUHHFDVKࢊRZ

(15% weighting)

Threshold 0.0% eP £151.2m 0% 0%

Target 7.5% eP

Maximum 15.0% eP

e reduction

(Scope 1 and 2 emissions)

(15% weighting)

Threshold 0.0%  10% 15% 15%

Target 7.5% 5.5%

Maximum 15.0% 8.0%

Individual strategic targets

(detailed to the right)

Up to 10% 10% 7.5%

Total (formulaic outcome) 25% 22.5%

$GMXVWPHQWWRUHࢊHFWDGMXVWHG

PBT underpin not being met

(25)% (22.5)%

Final outcome 0% 0%

Individual strategic targets Outcomes

Simon

Pryce

Group transformation

– Develop and implement RS Group strategy to

deliver exceptional returns for all stakeholders

– Identify and transition to the required target

operating model to accelerate strategy delivery

– Clarify and implement the organisational values

required to execute on the strategy delivery

5HࢉQHGVWUDWHJ\RSHUDWLQJPRGHODQG&RPSDQ\

values agreed with the Board and launched to

RXUVHQLRUOHDGHUVDWWKH/HDGHUVKLS(YHQWLQ

0DUFK

Successfully appoint and onboard the new

CFO position

Kate Ringrose appointed and successfully onboarded

in October 2023. Additionally, appointed and

onboarded the new CPO in October 2023, and

reshaped the ExCo, appointing new roles to accelerate

the delivery of our strategy

Accelerate the integration of Distrelec to optimise

value realisation

Integration plan and team in place and activity ongoing

to achieve implementation to the revised timescales

Kate

Ringrose

Strategic planning

– Deliver strategic plan to the Board, identifying

future investment

– 'HࢉQHDQGLPSOHPHQWDUREXVWSHUIRUPDQFH

management process to measure the execution

of the strategic plan

Strategic plan approved by the Board and robust

performance management process launched to senior

OHDGHUVLQ0DUFKIRUFDVFDGHDQGLPSOHPHQWDWLRQ

IURP$SULO

Finance structure

– 'HࢉQHDQGLPSOHPHQWࢉQDQFHVWUXFWXUHWR

VXSSRUWWKHGHOLYHU\RIWKHUHࢉQHGVWUDWHJ\

– Accountable for the SAP ERP transformation

)LQDQFHVWUXFWXUHLGHQWLࢉHGDQGWUDQVLWLRQLVRQJRLQJ

Successful transition of Group Auditors from

PwC to Deloitte

Deloitte to shadow PwC in closing the year ended

0DUFK5HYLHZFDGHQFHLQSODFHWRHQVXUH

successful transition

2021 LTIP Awards vesting

Neither Executive Director participated in this award. However, for reference, the performance measures,

WDUJHWUDQJHVDQGSHUIRUPDQFHDJDLQVWHDFKRIWKHPHDVXUHVRYHUWKHWKUHH\HDUVHQGHG0DUFK

are summarised in the table below:

Measure Weight

Threshold

(25% of max)

Maximum

(100% of max)

Performance

achieved

Vesting (% of

maximum)

Adjusted EPS (cumulative 2021/22,



50% 133p 158p 158.7p 50%

TSR (vs industrial / electronic

peer group)

1,2

50% Median Upper

quartile

Below

median

ROCE (average over 2021/22,



Underpin

20%

25.6%

Total 2021 LTIP Award vesting 50%

1. Straight-line vesting between measurement points. Vested awards will be subject to a two-year holding period post vesting.

2. TSR peer group is detailed on page 105.

Directors’ Remuneration report continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 107

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Scheme interests awarded during the year ended 31 March 2024 (audited)

2023 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

 175,168

Award date face value e £1,250,000

Performance period 1 April 2023 – 31 March 2026

Threshold vesting outcome 25%

Post-vesting holding period Two years

1. Awards were made using the average of the share price for the three dealing days immediately preceding the date of grant, being

0D\IRU6LPRQ3U\FHSDQG1RYHPEHUIRU.DWH5LQJURVHS7KHVKDUHVZHUHDZDUGHGDVSHUIRUPDQFH

shares, the performance conditions are detailed below.

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

2025/26 adjusted EPS compared with the

2022/23 adjusted EPS)

50% 5% 10%

TSR (vs industrial / electronic peer group)

1,2

50% Median Upper

Quartile

52&(DYHUDJHRI 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.

1. Straight-line vesting between measurement points.

2. TSR peer group is detailed on page 105.

J2G LTIP Award

'XULQJWKH\HDUWKHIROORZLQJ-*/7,3$ZDUGZDVJUDQWHGWR6LPRQ3U\FH

Simon Pryce

Basis of award (% of base salary) 

Number of performance shares awarded 

Award date face value (1,020.50p per share)

£3,627,133

Performance period 1 April 2022 – 31 March 2025

Threshold vesting outcome 0%

Post-vesting holding period Three years

1. The awards were made using the average of the middle market quota (MMQ) share prices for the dealing in the period 9 to 29 March

2022 (1,020.50p). The shares were awarded as performance shares; the performance conditions are detailed below.

7KHDZDUGJUDQWHGWR6LPRQZDVSURUDWHGDQGLVHTXLYDOHQWWRRIEDVHVDODU\RIWKH*URXSȆVIRUPHU

CEO and is subject to the achievement of the exceptionally stretching performance conditions as set out

EHORZ7KHDZDUGLVGXHWRYHVWLQ-XO\DQGLQOLQHZLWKEHVWSUDFWLFHDQGVKDUHKROGHUH[SHFWDWLRQV

an additional holding period will be applied to Simon’s award such that the total vesting and holding

SHULRGLVࢉYH\HDUV

The performance conditions are as follows:

Measure Weight

Threshold

(0% of max)

Maximum

(100% of max)

Adjusted EPS CAGR (three-year CAGR of the

DGMXVWHG(36FRPSDUHGZLWKWKH

2021/22 adjusted EPS)

70% 15% 21%

Key long-term performance indicators (KPIs)

scorecard (see page 109)

30%

52&(DYHUDJHRI 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.

7KHVFRUHFDUGFRPSULVHVWKHVSHFLࢉF.3,VZKLFKZLOOUHࢊHFWH[HFXWLRQRIWKHVWUDWHJ\LQHDFKDUHD

ZLWKVSHFLࢉFIRFXVRQFXOWXUDOWUDQVIRUPDWLRQRSHUDWLRQDODQGJURZWKDFFHOHUDWLRQZLWKࢉQDQFLDOV

DOUHDG\UHࢊHFWHGLQWKH(36FRPSRQHQW7KHVFRUHFDUGPHDVXUHVHDFKKDYHDVWUHWFKLQJWDUJHWUDQJH

The scorecard measures and weightings are detailed on page 109.

Directors’ Remuneration report continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 108

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Weighting Measure Threshold Maximum

Cultural

transformation

7. 5% (PSOR\HHHQJDJHPHQWVFRUH

7REHPHDVXUHGEDVHGRQWKH*URXS

employee engagement survey outcome.

Upper

quartile

Upper

decile

Operational

efficiency

7. 5% 2Q7LPH7R3URPLVH

Available product delivered when expected in a

FRVWHࢆHFWLYHDQGHࢇFLHQWPDQQHU3HUIRUPDQFH

to be measured over the three-month period

ending 31 March 2025.

95% 98%

Growth

accelerators

5.0% :HEUHYHQXH

,QFUHDVHGZHEWUDࢇFLQFUHDVLQJDYHUDJHRUGHU

value and increasing average order frequency.

Performance to be measured on web revenue

CAGR over the three-year period ending

31 March 2025.

12.0% 

5.0% 6HUYLFHVROXWLRQVUHYHQXH

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 ending 31 March 2025.

12.5% 15.5%

5.0% 1HZSURGXFWLQWURGXFWLRQ13,UHYHQXH

A wider product range, driven by data insights to

ensure it is relevant, increases customer loyalty

DQGKHOSVWKH*URXSEHFRPHWKHLUࢉUVWFKRLFH,W

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 ending

31 March 2025.

 26.0%

Kate Ringrose sign-on arrangements

The Committee carefully considered the approach to compensating Kate 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 detail of these replacement

awards is summarised in the table below.

Grant date Award mechanism

Maximum value

at grant date

awarded Performance conditions

Normal

vest date

1RYHPEHU

2023

Performance

£162,330 25,973

This award was based on

the disclosed performance

of the equivalent forfeited

award in Kate’s previous

employer.

-XQH

1RYHPEHU

2023

Restricted shares £89,397 12,527 – -XQH

1. Both of the above awards made to Kate will be subject to a two-year post vest holding period. The grant share price was 713.60p.

The awards were made using the average of the MMQ share prices for the dealing three days preceding the grant.

 7KHRXWFRPHRIWKHSHUIRUPDQFHVKDUHDZDUGZLOOEHGHWHUPLQHGE\WKHࢉQDORXWFRPHRIWKH&HQWULFD/7,3SODQDVGRFXPHQWHG

in the Centrica plc 2023 Annual Report & Accounts. Full details will be disclosed post vesting of the award in the 2025 DRR.

3. Kate will also receive additional RS shares as compensation dividend equivalent shares forfeited with Centrica plc. Full details will be

disclosed post vesting of the award in the 2025 DRR.

SAYE

Both Simon Pryce and Kate Ringrose each received a grant of 3,300 share options for their planned

contributions to SAYE. Full details of the grants are detailed on page 113.

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

Neither Simon Pryce nor Kate Ringrose have any external appointments.

Implementation of Chair and Non-Executive Directors 2022 Remuneration Policy

for the year ended 31 March 2024

Chair and Non-Executive Director remuneration

Non-Executive Directors do not have service agreements, but instead have letters of appointment. The

Chair’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 Chair nor the Non-Executive

Directors are eligible to participate in any of the Company’s incentive, share schemes or pension plans.

Details of the policy on fees paid to the Company’s Chair and Non-Executive Directors are set out in the

Policy available in the Governance section of our website: rsgroup.com.

Directors’ Remuneration report continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 109

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Single figure for total remuneration for Non-Executive Directors (audited)

7KHWDEOHEHORZVHWVRXWDVLQJOHࢉJXUHIRUWKHWRWDOUHPXQHUDWLRQUHFHLYHGE\HDFK1RQ([HFXWLYH

'LUHFWRUIRUWKH\HDUHQGHG0DUFKDQGWKHSULRU\HDU

Total fees Taxable expenses Total

2024 2023 2024 2023 2024 2023

Rona Fairhead £377,804 £366,800 £6,037 £5,213 £383,841 £372,013

Alex Baldock £66,601 e £984 £1,756 £67,585 e

Louisa Burdett £81,601 £79,662 £498 £2,089 £82,099 £81,751

Navneet Kapoor

£66,601 £53,885 £11,450 £1,275 £78,051 £55,160

Bessie Lee £71,601 £69,662 £9,493 e £81,094 £75,099

Simon Pryce

– e –£1,822 –£80,676

David Sleath £81,601 £79,662 £551 £1,550 £82,152 £81,212

-RDQ:DLQZULJKW

£87,409 e £14,097 £13,885 £101,506 e

 1DYQHHW.DSRRUZDVDSSRLQWHGDVD1RQ([HFXWLYH'LUHFWRURIWKH%RDUGRQ-XQH

 6LPRQ3U\FHVWHSSHGGRZQDVDPHPEHUDQG&KDLURIWKH&RPPLWWHHRQ0DUFKDQGDVD1RQ([HFXWLYH'LUHFWRUZLWKHࢆHFW

IURP$SULOIROORZLQJFRQࢉUPDWLRQRIKLVDSSRLQWPHQWWR&(2RIWKH*URXSIURP$SULO

 -RDQ:DLQZULJKWZDVDSSRLQWHG&KDLURIWKH5HPXQHUDWLRQ&RPPLWWHHRQ0DUFKDQGKHUIHHVZHUHLQFUHDVHGDFFRUGLQJO\

)RUWKH1RQ([HFXWLYH'LUHFWRUVUHFHLYHGEDVHIHHVRIeSHUDQQXP)HHVZHUHSDLGRQ

DSURUDWDEDVLVUHࢊHFWLQJOHQJWKRIWLPHLQWKHUROH$GGLWLRQDOIHHVRIeSHUDQQXPZHUHSDLGLQ

respect of the Senior Independent Director role and to the Chairs of the Audit and Remuneration

Base salary / fees 7D[DEOHEHQHࢉWV Annual incentive

Change

2023/24

Change

2022/23

Change

2021/22

Change

2020/21

Change

2023/24

Change

2022/23

Change

2021/22

Change

2020/21

Change

2023/24

Change

2022/23

Change

2021/22

Change

2020/21

Simon Pryce

850.3% 2.8% 9.6% 0% 100% N/A N/A N/A N/A N/A N/A N/A

Kate Ringrose

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 Egan

(90.4)% 8.2% 3.2% 0% (90.4)% (1.2)% 0.1% 0% (100)%  3.0% 272.9%

Rona Fairhead



3.0%  223.1% N/A N/A N/A N/A N/A N/A N/A N/A N/A

Alex Baldock

3.0%  N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

Louisa Burdett 2.4% 3.9% 9.6% 0% N/A N/A N/A N/A N/A N/A N/A N/A

Bessie Lee

2.8% 5.8% 9.8% 0% N/A N/A N/A N/A N/A N/A N/A N/A

Navneet Kapoor

23.5% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

David Sleath

2.4% 3.9% (2.1)% 0% N/A N/A N/A N/A N/A N/A N/A N/A

-RDQ:DLQZULJKW

24.0% 7.0 % 9. 8% 0% N/A N/A N/A N/A N/A N/A N/A N/A

UK-based ExCo and employee population

7.4% 8.1% 1.92% 1.3% (8.3)% 5.6%  (1.5)% 17.1% 20.3% 17.7% 

 6LPRQ3U\FHVWHSSHGGRZQDV&KDLURIWKH&RPPLWWHHRQ0DUFKDQGDVD1RQ([HFXWLYH'LUHFWRUZLWKHࢆHFWIURP$SULOIROORZLQJFRQࢉUPDWLRQRIKLVDSSRLQWPHQWDV&(2RIWKH*URXSHࢆHFWLYH$SULO7KHYHU\ODUJHSHUFHQWDJHLQFUHDVHIRUVLPSO\

UHࢊHFWVWKLVWUDQVLWLRQRI6LPRQȆVUROHIURPD1RQ([HFXWLYH'LUHFWRUWRDQ([HFXWLYH'LUHFWRU

 .DWH5LQJURVHZDVDSSRLQWHGDV&)2RIWKH*URXSHࢆHFWLYH2FWREHU

3. David Egan was paid a double hatting allowance of £200,000 pro-rated for the period 3 November 2022 to 2 April 2023 as compensation for acting in the role of CEO, which is excluded from the above table. David’s 2022/23 incentive was delivered without the share deferral

element. Further details can be found on page 125 of last year’s report.

 5RQD)DLUKHDGZDVDSSRLQWHGWRWKH%RDUGRQ1RYHPEHUDV1RQ([HFXWLYH'LUHFWRUDQGUHFHLYHGWKH1RQ([HFXWLYH'LUHFWRUEDVHIHHXQWLOVKHEHFDPH&KDLURIWKH%RDUGDQG1RPLQDWLRQ&RPPLWWHHRQ)HEUXDU\DWZKLFKSRLQWKHUIHHZDVLQFUHDVHGWRWKH&KDLUȆV

fee at that time of £350,000.

5. Alex Baldock was appointed to the Board on 1 September 2021.

 %HVVLH/HHZDVDSSRLQWHGDV%RDUGHPSOR\HHHQJDJHPHQWUHSUHVHQWDWLYHRQ-XQH

 1DYQHHW.DSRRUZDVDSSRLQWHGWRWKH%RDUGRQ-XQH

 'DYLG6OHDWKVWHSSHGGRZQDV&KDLURIWKH1RPLQDWLRQ&RPPLWWHHRQ-DQXDU\

-RDQ:DLQZULJKWZDVDSSRLQWHGDV%RDUGHPSOR\HHHQJDJHPHQWUHSUHVHQWDWLYHRQ-XQHDQG&KDLURIWKH5HPXQHUDWLRQ&RPPLWWHHRQ0DUFK

7KHDQQXDOSHUFHQWDJHFKDQJHLQERQXVLVFDOFXODWHGE\UHIHUHQFHWRWKHERQXVSD\DEOHLQUHVSHFWRISHUIRUPDQFHDSSOLFDEOHWRWKHࢉQDQFLDO\HDUIRU([HFXWLYH'LUHFWRUVDQGE\UHIHUHQFHWRDOOERQXVSD\PHQWVUHFHLYHGGXULQJWKHࢉQDQFLDO\HDUIRUDOOHPSOR\HHV

Directors’ Remuneration report continued

Committees. The Chair of the Nomination Committee role was conducted by Rona Fairhead, Chair of the

Board. Rona did not receive an additional fee for chairing the Nomination Committee. Bessie Lee and

-RDQ:DLQZULJKWHDFKUHFHLYHGDQDGGLWLRQDOIHHRIeSHUDQQXPIRUWKHLUUROHDVWKH%RDUGȆV

representatives on employee engagement. Expenses have increased compared to previous years as

a result of travel costs linked to in-person attendance at Board and Committee meetings.

Percentage change in remuneration of the Directors and employees as 31 March 2024

The table below shows the percentage change in the annual cash remuneration of the Directors

FRPSULVLQJEDVHVDODU\IHHVWKHYDOXHRIWD[DEOHEHQHࢉWVDQGHDUQHGDQQXDOLQFHQWLYHVDVGLVFORVHGLQ

WKHVLQJOHࢉJXUHIRUWRWDOUHPXQHUDWLRQWDEOHVRQSDJHIRU([HFXWLYH'LUHFWRUVDQGWRWKHOHIWIRUWKH

Non-Executive Directors) from the prior year compared with the average percentage change for all

UK employees of the Group. This group consists of UK-based ExCo and employees. If the Directors did

not serve a full year their base salary / fee is annualised. This table will be built up over time to show

WKHUHTXLUHGࢉYH\HDUKLVWRU\

7KHXSZDUGFKDQJHLQLQFHQWLYHUHࢊHFWVDQLQFUHDVHWRLQFHQWLYHWDUJHWOHYHOVIRUVRPHHPSOR\HHV

SDUWLFLSDWLQJLQWKH*URXS$QQXDO,QFHQWLYHGXULQJDQGLQFUHDVHGHPSOR\HHLQFHQWLYH

SDUWLFLSDWLRQDFURVVWKH*URXS%HQHࢉWVSURYLGHGIRUEURDGHUHPSOR\HHVLQFOXGHPHGLFDOLQVXUDQFH

DQGIRUVRPHHPSOR\HHVYHKLFOHRUYHKLFOHDOORZDQFH7KHGRZQZDUGFKDQJHLQEHQHࢉWVIRUEURDGHU

employees is explained by the accelerated transition from transitional fuel vehicles into electric / hybrid

YHKLFOHVIROORZLQJDVXEVWDQWLDOUHGXFWLRQLQYHKLFOHOHDGWLPHVEXWZDVRࢆVHWE\KLJKOHYHOVRIPHGLFDO

LQࢊDWLRQLPSDFWLQJWKHFRVWRIRXUSODQV

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 110

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

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.

7KHWDEOHEHORZGHWDLOVWKH&(2ȆVVLQJOHࢉJXUHRIUHPXQHUDWLRQIRUWKHVDPHSHULRG

Total shareholder return

YDOXHRIeLQYHVWHGRQ0DUFK

150

100

200

250

300

350

400

450

500

2014 2015 2016 2017 2018 2019 2020 2021 2022 202

2023

FTSE All Share

FTSE 100RS Group plc FTSE 250

Source: Datastream

Directors’ Remuneration report continued

Year ended

31 March

2015

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

Ian Mason Lindsley Ruth Lindsley Ruth Lindsley Ruth Lindsley Ruth Lindsley Ruth Lindsley Ruth Lindsley Ruth Lindsley Ruth

David Egan

Simon Pryce

CEO total remuneration (£000s) 891 2,072    2,551 2,578 2,976 1,813  850

Annual incentive award

(as a % of maximum opportunity) 16.9% 23.8% 82.5% 90.1% 68.0% 21.7% 80.8% 80.0% 63.2% 63.2% 0%



LTIP award vesting

(as a % of maximum opportunity) 0% N/A

N/A

100% 100% 91.3%   50.0% 50.0% N/A

1. Lindsley Ruth joined the Company in 2015 and therefore did not receive any vested LTIP Awards in 2016 and 2017.

 /LQGVOH\5XWKȆVUHPXQHUDWLRQIRUWKH\HDUHQGHG0DUFKLVSURUDWHGWRUHࢊHFWWKDWKHVWHSSHGGRZQIURPWKHUROHRI&(2RQ'HFHPEHU

 'DYLG(JDQȆVUHPXQHUDWLRQIRUWKH\HDUHQGHG0DUFKKDVEHHQDGMXVWHGWRUHࢊHFWWKHSHULRGKHDFWHGDV&(21RYHPEHUWR0DUFK

 6LPRQ3U\FHGLGQRWUHFHLYHDQLQFHQWLYHDZDUGIRUWKH\HDUHQGHG0DUFK)XOOGHWDLOVRIWKHLQFHQWLYHRXWFRPHVDUHGHWDLOHGRQSDJH

 6LPRQ3U\FHZDVDSSRLQWHGDV&(2LQDQGWKHUHIRUHGLGQRWUHFHLYHDQ\YHVWHG/7,3$ZDUGVLQWKH\HDUHQGHG0DUFK

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



A £24,209 £27,455 31:1 £30,512 £35,284 24:1 £49,768 £59,203 14:1

2023 A e e  e e 80:1 e e 

2022 A e £22,552 115:1 £25,000 £27,770 93:1 e e 56:1

2021 A £20,277 £25,813 99:1 e e 88:1 e £51,858 

2020 A £18,050 e 207:1 £22,000 e 166:1 £33,721 e 105:1

 8.EDVHGHPSOR\HHGDWDDQGWKH&(2GDWDZDVWDNHQDVDW0DUFK

The Company adopted Method A in the regulations to calculate the pay ratios because this is considered

WREHWKHPRVWVWDWLVWLFDOO\UREXVWPHWKRGRORJ\8QGHU0HWKRG$WKHWRWDOSD\DQGEHQHࢉWVKDVEHHQ

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

WKHVLQJOHࢉJXUHPHWKRGRORJ\

As a result of Simon Pryce being appointed as CEO on 3 April 2023, the CEO pay ratio was calculated using

KLVDQQXDOLVHGUHPXQHUDWLRQ$VLJQLࢉFDQWSRUWLRQRI&(2SD\LVGHOLYHUHGDVYDULDEOHSD\DV6LPRQ3U\FH

GLGQRWKDYHDQ/7,3YHVWRUUHFHLYHDQLQFHQWLYHSD\PHQWGXULQJWKLVKDVUHVXOWHGLQDPDWHULDO

UHGXFWLRQLQWKH&(2UDWLR:HDQWLFLSDWHWKLVLQFUHDVLQJLQIXWXUH\HDUVZKHQYDULDEOHSD\PHQWVDUHPDGH

to the CEO. In line with the Company’s reward practices, the median pay ratio employee receives a base

VDODU\DWPDUNHWUDWHVIRUWKHLUUROHDQGLVHOLJLEOHIRUWKHIXOOUDQJHRIEHQHࢉWVDYDLODEOHWRWKHLUSHHUVRI

the same level within the organisation.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 111

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Directors’ Remuneration report continued

3D\PHQWVIRU/RVVRIRࢇFHDXGLWHG

7KHUHZHUHQRSD\PHQWVIRUORVVRIRࢇFHGXULQJWKH\HDURWKHUWKDQWKRVHSUHYLRXVO\GLVFORVHGRQSDJH

RIODVW\HDUȆVUHSRUW'DYLG(JDQZDVRQJDUGHQLQJOHDYHIRUWKHࢉUVWVL[PRQWKVRIKLVQRWLFHSHULRG

7KHUHDIWHUKHZDVSDLGLQOLHXRIQRWLFHIRUWKHࢉQDOVL[PRQWKVRIKLVQRWLFHSHULRGHQGLQJRQ0D\

'XULQJERWKSHULRGVKHUHFHLYHGKLVEDVHVDODU\RQDPRQWKO\EDVLVUHFHLYLQJDWRWDORIe+HDOVR

FRQWLQXHGWRUHFHLYHSHQVLRQDOORZDQFHDQGRWKHUEHQHࢉWVGXULQJWKHLQLWLDOSHULRGWR1RYHPEHU

comprising a total of £28,071 and £9,771, respectively. In line with his service contract, Lindsley Ruth

UHFHLYHGKLVEDVHVDODU\RIeSHQVLRQDOORZDQFHRIeDQGRWKHUEHQHࢉWVRIeIRU

the duration of his 12-months’ notice period, ending on 16 December 2023.

Payments to past directors (audited)

There were no payments to past directors, other than those previously disclosed on page 125 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.

104

23/2422/23

Dividend

£m

17%

470

479

23/2422/23

Total employee pay expenditure

£m

(2)%

7KHWRWDOHPSOR\HHSD\H[SHQGLWXUHࢉJXUHVDERYHLQFOXGHODERXUH[LWFRVWVVHWRXWLQ1RWHRQSDJH

Directors’ shareholdings (audited)

The interests of the Directors and their connected persons in the Company’s ordinary shares are shown

below, together with total share awards and share options and information on whether the Executive

'LUHFWRUVKDGPHWWKHLUVKDUHKROGLQJUHTXLUHPHQWVRQ0DUFK)RU([HFXWLYH'LUHFWRUV

ZHUHH[SHFWHGWRVWDUWWREXLOGXSDSHUVRQDOKROGLQJWRRIVDODU\LQ56*URXSSOFVKDUHV

6KDUHDZDUGVKHOG

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 but

not subject to

performance

(D)

Simon Pryce 139,077   No –  –3,300

Kate Ringrose –  0% No 12,527  –3.300

David Egan

  670%Yes––– –

Alex Baldock 2,239

Louisa Burdett –

Rona Fairhead 

Navneet Kapoor –

Bessie Lee –

David Sleath 22,666

-RDQ:DLQZULJKW –

1. The number of shares and current holding percentage of salary is shown as at 3 May 2023 for David Egan, the date on which he stepped

down from the Board.

 ,QFOXGLQJ-*/7,3$ZDUGZKHUHDSSOLFDEOH$VVHWRXWRQSDJHRIODVW\HDUȆVUHSRUW'DYLG(JDQȆVXQYHVWHGDQG/7,3

$ZDUGVDQGKLV-*/7,3$ZDUGODSVHGLQIXOO

3. As set out on page 125 of last year’s report, David Egan’s 2022 DSBP shares vested on 3 November 2023. Shares were sold to settle tax

liabilities and the balance of shares are to be retained until the normal vesting date.

The value of the shares used to calculate whether the shareholding guideline is met is 762.0p, being

WKHDYHUDJH004VKDUHSULFHRYHUWKHWKUHHPRQWKVHQGHG0DUFK%HWZHHQWKH\HDUHQG

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 113.

Executive Directors’ service contracts

6LPRQ3U\FHHQWHUHGDVHUYLFHFRQWUDFWZLWKWKH&RPSDQ\RQ0DUFKZLWKDQHࢆHFWLYHGDWH

RI$SULO.DWH5LQJURVHHQWHUHGDVHUYLFHFRQWUDFWZLWKWKH&RPSDQ\RQ-XO\ZLWKDQ

HࢆHFWLYHGDWHRI2FWREHU%RWKFRQWUDFWVKDYHQRࢉ[HGWHUPDQGDUHVXEMHFWWRPRQWKVȆ

notice by either party.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 112

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Director’s share scheme interests (audited)

Share awards

Scheme Notes Date of award

Shares awarded

on 1 April

2023

Awarded during

the year

Vested during

the year

Lapsed during

the year

Shares awarded

on 31 March

2024

Normal

Vesting

date

Simon Pryce LTIP 1 26 May 23 –  –– 26 May 26

-*/7,3 1 26 May 23 –  –– -XO

Total 591,841 591,841

Kate Ringrose Performance

sign-on

2 1RY –25,973 – –25,973-XQ

Restricted

sign-on

2 1RY –12,527 – –12,527-XQ

LTIP 1 1RY – 175,168 – – 175,168 26 May 26

Total 213,668 213,668

David Egan LTIP  19 Nov 20 127,699 3,280  63,850 – -XQ

1,3 -XQ  –– – -XQ

1,3 -XO 123,365 – – 123,365 – -XO

-*/7,3 1,3 -XO  –– – -XO

DSBP  -XQ  552 17,009 – – -XQ

 -XO 18,108  18,573 – – -XO

Total 743,699 4,297 102,711 645,284 –

 $OODZDUGVPDGHWRWKH([HFXWLYH'LUHFWRUVXQGHUWKH/7,3DQG-*/7,3DZDUGVDUHVXEMHFWWRSHUIRUPDQFHFRQGLWLRQVVHWRXWRQSDJHVDQG7KHQRUPDOYHVWLQJGDWHIRUWKH/7,3DZDUGLVWKHWKLUGDQQLYHUVDU\RIJUDQWWKH/7,3$ZDUGYHVWHGRQ-XQH

2. The restricted sign-on award is not subject to performance conditions and therefore has been disclosed in the Single Figure Remuneration table on page 106 accordingly.

 'DYLG(JDQȆVDQG/7,3$ZDUGVDQGKLV-*/7,3$ZDUGVODSVHGLQIXOORQKLVWHUPLQDWLRQGDWH1RYHPEHU

 6KDUHVLQOLHXRIGLYLGHQGVZHUHDZDUGHGWR'DYLG(JDQXSRQYHVWLQJRIWKH/7,3$ZDUGDQGWKHDQG'6%3$ZDUGV

5. The shares from David Egan’s 2022 DSBP were taxed at his termination date, 3 November 2023, but the after-tax shares will not be released until the normal vesting date for the award.

Share options

Scheme Date of grant Vesting date Expiration date Exercise price

under option

1 April 23

Granted during

the year

Exercised during

the year

Lapsed during

the year

Shares under option

31 March 2024

Simon Pryce SAYE 6 Dec 23 1 Feb 27 -XO 562.00p – 3,300 – – 3,300

Total –3,300 – –3,300

Kate Ringrose SAYE 6 Dec 23 1 Feb 27 -XO 562.00p – 3,300 – – 3,300

Total –3,300 – –3,300

David Egan SAYE 10 Sep 21 1 Nov 26 30 Apr 27 S  –– –

Total 3,640 – – 3,640 –

Directors’ Remuneration report continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 113

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Summary of shareholder voting

Summarised below are the results at the 2023 AGM vote on the 2023 DRR (excluding the part

summarising the Policy) and the 2022 AGM vote on the 2022 Remuneration Policy:

2023 vote on Directors’ Remuneration Report Total number of votes % of votes cast

For (including discretionary) 233,063,776 61.59%

Against  

Total votes cast (excluding withheld votes) 

Votes withheld 

Total votes (including withheld votes) 391,851,726

1. For further details regarding the low vote for the 2022/23 Directors’ Remuneration Report, including a summary of the reasons for it,

see pages 100 and 101.

2022 vote on Directors’ Remuneration Policy Total number of votes % of votes cast

For (including discretionary) 230,629,838 60.77%

Against  39.23%

Total votes cast (excluding withheld votes) 

Votes withheld 25,152,385

Total votes (including withheld votes) 404,676,617

2. For further details regarding the low vote for the 2022 Remuneration Policy, see page 116 of the Annual Report and Accounts 2023.

Advisors

Deloitte had provided independent advice since being appointed by the Committee in 2015. Deloitte is

a founding 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 www.remunerationconsultantsgroup.com). Deloitte stepped down as independent advisor in

October 2023, following their appointment as the new external Auditors. All services were completed

by 31 October 2023. There was no connection between Deloitte, the Company or its Directors.

During the year Deloitte provided advice in several areas, including:

– Independent advice to support the Committee in setting performance targets

– Updates to the Committee on regulatory changes and the investor environment

Deloitte also provided advice to the Company regarding globally mobile employees, but the Committee

did not consider that this jeopardised the independence of Deloitte, which operated in line with the Code

of Conduct described above. Deloitte’s fees for the provision of executive remuneration consultancy

services to the Committee during the year, charged on a time and materials basis, totalled £23,000.

Following a robust tender process, A&M were appointed as the new independent advisors to the

Committee from November 2023. The detail of the appointment process is set out to the right. A&M is

also a member of the Remuneration Consultants Group and they too voluntarily operate under the Code

of Conduct in relation to executive remuneration consultancy in the UK. There is no connection between

A&M, the Company or its Directors.

Directors’ Remuneration report continued

During the year A&M provided advice to the Committee, including:

– Guidance to develop a refreshed reward philosophy and to design short and long-term incentives

– 6XSSRUWLQGUDIWLQJWKH'LUHFWRUVȆ5HPXQHUDWLRQ5HSRUWIRUWKH\HDUHQGHG0DUFK

– Independent advice to support the Committee in setting performance targets

– 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 £96,850.

ADVISOR APPOINTMENT PROCESS

A three stage selection process was followed to ensure a fair, robust, and in-depth assessment in

respect of the appointment of a new independent advisor to the Committee. In summary this

included:

5HTXHVWIRULQIRUPDWLRQ5),

)LYHࢉUPVZHUHLQYLWHGWRUHVSRQGWRDQ5),)ROORZLQJDUHYLHZRIWKHUHVSRQVHVDJDLQVW

WKHSUHGHࢉQHGVHOHFWLRQFULWHULDWKUHHࢉUPVLQFOXGLQJ$0ZHUHVKRUWOLVWHGDQGLQYLWHG

to meet with a selection panel to discuss their response in detail.

6HOHFWLRQPHHWLQJV

7KHPHHWLQJVWRRNSODFHLQ$XJXVWZLWKWKHࢉUVWVWDJHVHOHFWLRQSDQHO+DYLQJ

FRQVLGHUHGWKHSUHVHQWDWLRQFRQWHQWDQGFXOWXUDOࢉWZLWK56DJDLQVWWKHVHOHFWLRQFULWHULD

WZRࢉUPVLQFOXGLQJ$0ZHUHVKRUWOLVWHGIRUWKHࢉQDOVHOHFWLRQPHHWLQJV

Final selection meetings

7KHࢉQDOVHOHFWLRQPHHWLQJVWRRNSODFHLQ2FWREHUZLWKWKHVHFRQGVWDJHVHOHFWLRQ

panel, which consisted of the Chair of the Committee, CEO, CPO and Company Secretary.

%RWKࢉUPVZHUHDVNHGWRSURYLGHDKLJKOHYHORYHUYLHZRIWKHSURSRVHGVHUYLFHVWREH

provided, including showcasing their experience of providing remuneration advisory

services to high growth, cyclical global companies. Additionally, they were asked to

SURYLGHDQRYHUYLHZRIKRZWKH\LQWHQGHGWRHQJDJHDQGEXLOGDQHࢆHFWLYHZRUNLQJ

relationship with both management and the Committee.

)ROORZLQJWKHࢉQDOVHOHFWLRQPHHWLQJVWKHSDQHOZDVXQDQLPRXVLQLWVUHFRPPHQGDWLRQWRDSSRLQW

A&M as independent advisor to the Committee. Having considered the recommendation in detail,

LQFOXGLQJWKHUHYLHZRIWKH5),DQGVFRUHVRIWKHࢉQDOWZRࢉUPVLQWKHSURFHVVWKH&RPPLWWHHDSSURYHG

the panel’s recommendation.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 114

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Directors’ Remuneration report continued

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

LQGLYLGXDOȆVUROH0HPEHUVRIWKH([&RDUHHOLJLEOHWRSDUWLFLSDWHLQWKH'6%3/7,3DQGWKH-*/7,3

$ZDUGVRQVLPLODUWHUPVLQFOXGLQJVKDUHRZQHUVKLSUHTXLUHPHQWV'LࢆHUHQFHVDSSO\ZKHUHDSSURSULDWH

HJLQWKHJUDQWOHYHOVDZDUGHG$ZDUGVPDGHXQGHUWKH-*/7,3$ZDUGDQG/7,3DZDUGVYHVWDIWHUWKUHH

years, subject to performance conditions and continued employment. Senior leaders may also be invited

to participate in the LTIP. 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

KHOSFUHDWH:HDFKLHYHGWKLVLQWKURXJK

– Providing the opportunity for all of our employees at all levels of the organisation to participate in

an incentive programme

– Providing employees in the newly acquired Risoul, to be become future shareholders through an

RS YAY! Award

– 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

trade unions and works councils, as part of its broader employee engagement strategy and consultation

RQPDWWHUVDࢆHFWLQJRXUSHRSOHDQGEXVLQHVVSHUIRUPDQFHDVUHTXLUHGLQHDFKFDVHE\ODZDQG

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

LVWKHHPSOR\HHHQJDJHPHQWVHVVLRQVKHOGZLWK%HVVLH/HHDQG-RDQ:DLQZULJKWLQWKHLUFDSDFLW\DV

engagement designated Non-Executive Directors. Further information regarding the sessions held

during the year can be found on pages 80 and 81.

Committee governance

Committee structure and meetings

7KH&RPPLWWHHLVFRPSULVHGRILQGHSHQGHQWPHPEHUV-RDQ:DLQZULJKWZDVDSSRLQWHGDV&KDLULQ

0DUFK-RDQKDVEHHQDPHPEHURIWKH&RPPLWWHHVLQFH-XO\DQGWKHUHIRUHPHHWVWKH

requirements of the Code. There have been no further changes to Committee membership during the

\HDU'HWDLOVRIWKHVNLOOVDQGH[SHULHQFHRIWKH&RPPLWWHHPHPEHUVFDQEHIRXQGRQSDJHVDQG

The Committee held four scheduled and two unscheduled meetings during the year. Details of

attendance at meetings can be found on page 76.

The Chair 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

VSHFLࢉFLWHPVDQGRQPDWWHUVUHODWLQJWRWKHSHUIRUPDQFHDQGUHPXQHUDWLRQRIVHQLRUPDQDJHUVRWKHU

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 Chair 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

&RPPLWWHHFRQWLQXHGWRRSHUDWHHࢆHFWLYHO\DQGLQDOLJQPHQWZLWKLWV7HUPVRI5HIHUHQFH)XUWKHUGHWDLOV

RIWKHHYDOXDWLRQSURFHVVFDQEHIRXQGLQWKH&RUSRUDWH*RYHUQDQFH5HSRUWRQSDJHVDQG

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 115

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Directors’ report

Information incorporated by reference

The following information required to be disclosed

in this Directors’ Report (in accordance with Listing

Rule (LR) 9.8.4R and otherwise) is set out on the

page numbers below:

Content Page

Likely future

developments

5 and 10 to 12

Diversity and Inclusion

Policy (including

disability

)

Employee engagement 6, 52 to 54, 73, 81 and

115

Other stakeholder

engagement

6, 7, 50, 51, 73, 80, 81

and 101

Greenhouse gas

emissions

44 and 45

Names of Directors who

served during the year

74 and 75

Details of employee share

schemes

100 to 102, 104,

106 and Note 9

Risk management

(including hedging) and

ࢉQDQFLDOLQVWUXPHQWV

159, 160 and 162 to 166

Activity on Company

culture

6, 18, 19, 21 and 53

to 55

Long-term incentive

schemes

104, 105, 107 to 109,

113 and Note 9

1. Information required by the Large and Medium-sized

Companies and Groups (Accounts and Reports) Regulations

2008 and included in the Strategic Report.

This section (together with the information

on pages 72 to 115 and other information

cross-referenced by this section which is

incorporated by reference) constitutes the

Directors’ report for the purposes of the

&RPSDQLHV$FWDQGIXOࢉOVWKHUHTXLUHPHQWV

of the corporate governance statement for the

purposes of the Financial Conduct Authority’s

Disclosure Guidance and Transparency Rules (DTR).

DIRECTORS’

REPORT

Principal activities

56*URXSLVDGLࢆHUHQWLDWHGJOREDOGLVWULEXWRU

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 2024 can be found in

Note 30 to the Group accounts on pages 169 to

172 of this Annual Report.

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 2024 are set out in the Group

income statement on page 127.

The Board proposes, subject to approval of

shareholders at the AGM to be held on

-XO\WKDWDࢉQDOGLYLGHQGRISSHU

ordinary share be paid on 19 July 2024 to

shareholders whose names are on the register of

members at the close of business on 14 June 2024.

The Directors have declared dividends as follows.

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 343,147 shares

as at 31 March 2024.

Appointment and retirement of

Directors

The appointment and retirement of Directors is

governed by the Company’s 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 at the

forthcoming AGM.

Biographies of the current Directors can be found

on pages 74 and 75. Details of the Directors

seeking re-election at the AGM are set out in the

Notice of AGM.

Dividends in 2023/24 Dividends in 2022/23

Interim dividend of 8.3p per ordinary share

(paid on 5 January 2024)

7.2p per ordinary share

3URSRVHGࢉQDOGLYLGHQGRISSHURUGLQDU\

share (to be paid on 19 July 2024)

13.7p per ordinary share

Total ordinary dividend of 22.0p per ordinary

share for the year ended 31 March 2024

20.9p per ordinary share

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 116

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

The Company purchased and maintained

'LUHFWRUVȆDQG2ࢇFHUVȆOLDELOLW\LQVXUDQFH

throughout 2023/24, which was renewed for

2024/25. Neither the indemnity nor insurance

provides cover in the event that a Director or

2ࢇFHULVSURYHGWRKDYHDFWHGIUDXGXOHQWO\

Substantial shareholders

The processes by which the Company seeks to

understand the views of its major shareholders

are described on page 7.

Information provided to the Company by

substantial shareholders pursuant to the DTR is

published via a Regulatory Information Service.

As at 31 March 2024 and 22 May 2024, being the

last practicable date, the Company had been

QRWLࢉHGE\LWVVXEVWDQWLDOVKDUHKROGHUVXQGHU5XOH

5 of the DTR of the following interests in the

Company’s shares:

Board composition changes

Changes to the composition of the Board since

1 April 2023 up to the date of this Report are

shown in the table below. Simon Pryce, who

joined the Board in September 2016 as a

Non-Executive Director, became CEO with

HࢆHFWIURP$SULO

Joined the Board Left the Board

Kate Ringrose 2 October

2023

David Egan 3 May 2023

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,

LQWHUHVWVWKDWFRQࢊLFWZLWKWKRVHRIWKH&RPSDQ\

XQOHVVWKDWFRQࢊLFWLVࢉUVWDXWKRULVHGE\WKH%RDUG

7KH%RDUGKDVLQSODFHDIRUPDOFRQࢊLFWVRILQWHUHVW

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

FRQࢊLFWDXWKRULVDWLRQVLWKDVJLYHQDQGDQ\

limitations that have been applied. The Company’s

Articles contain provisions to allow the Directors

WRDXWKRULVHSRWHQWLDOFRQࢊLFWVRILQWHUHVWVRWKDW

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 of

Association (Articles), the Company entered into

a new deed in March 2023 to indemnify the

'LUHFWRUVDQG2ࢇFHUVIURPWLPHWRWLPHRIWKH

Company to the extent permitted by the law.

The deed for existing Directors is available for

LQVSHFWLRQDWWKHUHJLVWHUHGRࢇFHRIWKH&RPSDQ\

Directors’ report continued

Shareholder

Number of

shares as at

31 March 2024

Percentage of

issued share

capital as at

31 March 2024

Number of

shares as at

22 May 2024

Percentage of

issued share

capital as at

22 May 2024

Ameriprise Financial, Inc.

47,120,586 9.94% 47,120,586 9.94%

FMR LLC 23,685,248 5.00% 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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 117

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Share capital

As at 31 March 2024, the Company’s issued share

capital comprised a single class of 474,012,312

ordinary shares of 10p each, totalling £47,401,231.

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

141 to 14 4.

The Company was authorised by shareholders at

the AGM held on 13 July 2023 to purchase up to 5%

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.

Restrictions on transfer of shares

The Directors may, in the case of shares in

FHUWLࢉFDWHGIRUPLQWKHLUDEVROXWHGLVFUHWLRQDQG

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 2024, 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

SROLWLFDOGRQDWLRQVXSWRDGHࢉQHGOLPLWWRHQVXUH

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.

AGM

The Notice of AGM is set out in a separate circular.

The AGM will be held at 12.00pm on Thursday,

-XO\DWWKHRࢇFHVRI$OOHQ2YHU\6KHDUPDQ

Sterling LLP, One Bishops Square, London E1 6AD.

7KLV\HDUZHZLOOEHRࢆHULQJVKDUHKROGHUVWKH

ability to attend in person. Shareholders can

submit questions relating to the business of the

meeting in advance to CompanySecretary@

rsgroup.com. Further information is set out in the

Notice of AGM.

Independent Auditors and audit

information

(DFK'LUHFWRUZKRKHOGRࢇFHDWWKHGDWHRI

DSSURYDORIWKLV'LUHFWRUVȆ5HSRUWFRQࢉUPVWKDW

– So far as they are aware, there is no relevant

audit information of which the Company’s

Auditors are unaware

– That each Director has taken all steps that

they ought to have taken as a Director to

make themselves aware of any relevant audit

information and to establish that the Company’s

Auditors are aware of that information

7KLVFRQࢉUPDWLRQLVJLYHQDQGVKRXOGEH

interpreted in accordance with the provisions

of the Companies Act.

6LJQLࢉFDQWDJUHHPHQWVFKDQJH

of control

The Company has a number of contractual

arrangements which it considers essential to the

EXVLQHVVRIWKH&RPSDQ\6SHFLࢉFDOO\WKHVHDUH

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

£685 million as at 31 March 2024 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.

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 72 to 115. These pages are incorporated

by reference into the Directors’ Report.

On behalf of the Board:

Clare Underwood

Company Secretary

22 May 2024

Directors’ report continued

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 118

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

STATEMENT OF

DIRECTORS’ RESPONSIBILITIES

Statement of Directors’ responsibilities

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

DFFRXQWVIRUHDFKࢉQDQFLDO\HDU8QGHUWKDWODZ

the Directors have prepared the Group accounts

LQDFFRUGDQFHZLWK8.DGRSWHGLQWHUQDWLRQDO

DFFRXQWLQJVWDQGDUGV8.,$6DQG&RPSDQ\

DFFRXQWVLQDFFRUGDQFHZLWK8QLWHG.LQJGRP

*HQHUDOO\$FFHSWHG$FFRXQWLQJ3UDFWLFH8QLWHG

Kingdom Accounting Standards, comprising

Financial Reporting Standard 102 ‘The Financial

5HSRUWLQJ6WDQGDUGDSSOLFDEOHLQWKH8.DQG

Republic of Ireland’ (FRS 102), and applicable law).

8QGHUFRPSDQ\ODZWKH'LUHFWRUVPXVWQRWDSSURYH

WKHDFFRXQWVXQOHVVWKH\DUHVDWLVࢉHGWKDWWKH\JLYH

DWUXHDQGIDLUYLHZRIWKHVWDWHRIDࢆDLUVRIWKH

*URXSDQG&RPSDQ\DQGRIWKHSURࢉWRUORVVRIWKH

Group and Company for that period. In preparing

the accounts, the Directors are required to:

– Select suitable accounting policies and then

apply them consistently;

– 6WDWHZKHWKHUDSSOLFDEOH8.,$6KDYHEHHQ

IROORZHGIRUWKH*URXSDFFRXQWVDQG8QLWHG

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.

The Directors are responsible for keeping

DGHTXDWHDFFRXQWLQJUHFRUGVWKDWDUHVXࢇFLHQWWR

show and explain the Group and Company’s

transactions and disclose with reasonable

DFFXUDF\DWDQ\WLPHWKHࢉQDQFLDOSRVLWLRQRIWKH

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

LQWKH8QLWHG.LQJGRPJRYHUQLQJWKHSUHSDUDWLRQ

DQGGLVVHPLQDWLRQRIDFFRXQWVPD\GLࢆHUIURP

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.

Each of the Directors, whose names and functions

DUHOLVWHGRQSDJHVDQGFRQࢉUPWKDWWRWKH

best of their knowledge:

– The Group accounts, which have been prepared

LQDFFRUGDQFHZLWK8.,$6JLYHDWUXHDQGIDLU

YLHZRIWKHDVVHWVOLDELOLWLHVࢉQDQFLDOSRVLWLRQ

DQGSURࢉWRIWKH*URXS

– The Company accounts, which have been

SUHSDUHGLQDFFRUGDQFHZLWK8QLWHG.LQJGRP

Accounting Standards, comprising FRS 102, give

a true and fair view of the assets, liabilities and

ࢉQDQFLDOSRVLWLRQRIWKH&RPSDQ\DQG

– The Strategic Report includes a fair review of the

development and performance of the business

and the position of the Group and Company,

together with a description of the principal risks

and uncertainties that it faces.

,QWKHFDVHRIHDFK'LUHFWRULQRࢇFHDWWKHGDWH

the Directors’ Report is approved:

– so far as the Director is aware, there is no

relevant audit information of which the Group

and Company’s Auditors are unaware; and

– 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

&KLHI([HFXWLYH2ࢇFHU

22 May 2024

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 119

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Independent Auditors’ report

INDEPENDENT

AUDITORS’

REPORT

TO THE

MEMBERS OF

RSGROUP PLC

Report on the audit of the accounts

Opinion

In our opinion:

– RS Group plc’s Group accounts and Company

accounts (the accounts) give a true and fair view

of the state of the Group’s and of the Company’s

DࢆDLUVDVDW0DUFKDQGRIWKH*URXSȆV

SURࢉWDQGWKH*URXSȆVFDVKࢊRZVIRUWKH\HDU

then ended;

– the Group accounts have been properly

prepared in accordance with UK-adopted

international accounting standards as applied in

accordance with the provisions of the Companies

$FW

– the Company accounts have been properly

prepared in accordance with United Kingdom

Generally Accepted Accounting Practice (United

Kingdom Accounting Standards, including FRS

ȅ7KH)LQDQFLDO5HSRUWLQJ6WDQGDUGDSSOLFDEOH

in the UK and Republic of Ireland’, and applicable

law); and

– the accounts have been prepared in accordance

ZLWKWKHUHTXLUHPHQWVRIWKH&RPSDQLHV$FW

We have audited the accounts, included within the

Annual Report and Accounts (the Annual Report),

which comprise: the Group and the Company

EDODQFHVKHHWVDVDW0DUFKWKH*URXS

income statement and the Group statement of

FRPSUHKHQVLYHLQFRPHWKH*URXSFDVKࢊRZ

statement, the Group and the Company

statements of changes in equity for the year then

ended; and the notes to the accounts, which

LQFOXGHDGHVFULSWLRQRIWKHVLJQLࢉFDQW

DFFRXQWLQJSROLFLHV

Our opinion is consistent with our reporting to the

$XGLW&RPPLWWHH

Basis for opinion

We conducted our audit in accordance with

International Standards on Auditing (UK) (ISAs

8.DQGDSSOLFDEOHODZ2XUUHVSRQVLELOLWLHVXQGHU

ISAs (UK) are further described in the Auditors’

responsibilities for the audit of the accounts

VHFWLRQRIRXUUHSRUW:HEHOLHYHWKDWWKHDXGLW

HYLGHQFHZHKDYHREWDLQHGLVVXࢇFLHQWDQG

DSSURSULDWHWRSURYLGHDEDVLVIRURXURSLQLRQ

Independence

We remained independent of the Group in

accordance with the ethical requirements that

are relevant to our audit of the accounts in the

UK, which includes the FRC’s Ethical Standard, as

applicable to listed public interest entities, and

ZHKDYHIXOࢉOOHGRXURWKHUHWKLFDOUHVSRQVLELOLWLHV

LQDFFRUGDQFHZLWKWKHVHUHTXLUHPHQWV

7RWKHEHVWRIRXUNQRZOHGJHDQGEHOLHIZH

declare that non-audit services prohibited by

WKH)5&ȆV(WKLFDO6WDQGDUGZHUHQRWSURYLGHG

2WKHUWKDQWKRVHGLVFORVHGLQ1RWHWRWKH*URXS

accounts, we have provided no non-audit services

WRWKH&RPSDQ\RULWVFRQWUROOHGXQGHUWDNLQJVLQ

WKHSHULRGXQGHUDXGLW

Our audit approach

Overview

Audit scope

– :HLGHQWLࢉHGVHYHQUHSRUWLQJFRPSRQHQWVDQG

used component teams in six countries which,

in our view, required a full scope audit based

RQWKHLUVL]H

– In addition, we used component teams to

SHUIRUPDXGLWSURFHGXUHVRQVSHFLࢉFDFFRXQW

line items of two reporting components, with

the Group engagement team performing audit

SURFHGXUHVRQVSHFLࢉFDFFRXQWOLQHLWHPVRI

DQRWKHUWKUHHUHSRUWLQJFRPSRQHQWV

– 7KH*URXSFRQVROLGDWLRQDFFRXQWVGLVFORVXUHV

and a number of other items (including taxation,

Group annual incentive accrual, goodwill,

acquired intangibles, share-based payments and

8.UHWLUHPHQWEHQHࢉWREOLJDWLRQVSUHSDUHGE\

WKHKHDGRࢇFHࢉQDQFHIXQFWLRQZHUHDXGLWHGE\

WKH*URXSHQJDJHPHQWWHDP

Key audit matters

– Inventory obsolescence provisions (Group)

– 'HࢉQHGEHQHࢉWSHQVLRQVFKHPHOLDELOLWLHVȁ

UK (Group)

– Fair value of acquired intangibles –

Distrelec (Group)

– Carrying value of investments (Company)

0DWHULDOLW\

– 2YHUDOO*URXSPDWHULDOLW\ePLOOLRQ

ePLOOLRQEDVHGRQRI*URXS

SURࢉWEHIRUHWD[VXEVWDQWLDOUHRUJDQLVDWLRQ

costs, substantial asset write-downs and

DFTXLVLWLRQUHODWHGLWHPV

– 2YHUDOO&RPSDQ\PDWHULDOLW\ePLOOLRQ

ePLOOLRQEDVHGRQRI

QHWDVVHWV

– 3HUIRUPDQFHPDWHULDOLW\ePLOOLRQ

ePLOOLRQ*URXSDQG

ePLOOLRQePLOOLRQ&RPSDQ\

The scope of our audit

As part of designing our audit, we determined

PDWHULDOLW\DQGDVVHVVHGWKHULVNVRIPDWHULDO

PLVVWDWHPHQWLQWKHDFFRXQWV

Key audit matters

Key audit matters are those matters that, in the

auditors’ professional judgement, were of most

VLJQLࢉFDQFHLQWKHDXGLWRIWKHDFFRXQWVRIWKH

FXUUHQWSHULRGDQGLQFOXGHWKHPRVWVLJQLࢉFDQW

DVVHVVHGULVNVRIPDWHULDOPLVVWDWHPHQWZKHWKHU

RUQRWGXHWRIUDXGLGHQWLࢉHGE\WKHDXGLWRUV

LQFOXGLQJWKRVHZKLFKKDGWKHJUHDWHVWHࢆHFW

on: the overall audit strategy; the allocation of

UHVRXUFHVLQWKHDXGLWDQGGLUHFWLQJWKHHࢆRUWV

RIWKHHQJDJHPHQWWHDP7KHVHPDWWHUVDQG

DQ\FRPPHQWVZHPDNHRQWKHUHVXOWVRIRXU

procedures thereon, were addressed in the

context of our audit of the accounts as a whole,

and in forming our opinion thereon, and we do

QRWSURYLGHDVHSDUDWHRSLQLRQRQWKHVHPDWWHUV

7KLVLVQRWDFRPSOHWHOLVWRIDOOULVNVLGHQWLࢉHG

E\RXUDXGLW

7KHNH\DXGLWPDWWHUVEHORZDUHFRQVLVWHQWZLWK

ODVW\HDU

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 120

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Inventory obsolescence provisions (Group)

5HIHUWRSDJH$XGLW&RPPLWWHH5HSRUWSDJH1RWH%DVLVRISUHSDUDWLRQ

DQGSDJH1RWH,QYHQWRULHV

Key audit matter How our audit addressed the key audit matter

7KHEDODQFHRIJURVVLQYHQWRULHVDW

0DUFKZDVePLOOLRQ

ePLOOLRQDJDLQVWZKLFK

SURYLVLRQVRIePLOOLRQePLOOLRQ

ZHUHKHOG

7KH*URXSȆVEXVLQHVVPRGHOLVEDVHGRQKDYLQJ

the broadest range in the industry and delivering

SURGXFWVRQWLPHRIWHQWKHQH[WGD\

7KLVUHVXOWVLQODUJHTXDQWLWLHVRILQYHQWRU\

FRPSULVLQJPDQ\GLࢆHUHQWW\SHVRISURGXFWV

being held for long periods of time which raises

WKHULVNRILQYHQWRU\REVROHVFHQFH

7KHLQYHQWRU\SURYLVLRQVDUHFDOFXODWHGRQ

an inventory cover basis with the underlying

calculation based on appropriate product

categorisation and assumptions over sales

WUHQGVSURYLVLRQUDWHVDQGUHFRYHUDEOHDPRXQWV

7KHLQYHQWRU\SURYLVLRQVDUHFDOFXODWHGZLWKLQ

the Group’s accounting systems using an

DXWRPDWHGSURFHVV:KHUHQHFHVVDU\PDQXDO

overlays are applied to these provisions to

account for unusual circumstances that may

have arisen during the year or where there is

a right of return in place in which case no

SURYLVLRQPD\EHUHTXLUHG

For the year-end inventory provisions, we

assessed the completeness of the data used by

the Group’s accounting system to calculate the

provisions by agreeing the sub-ledger to the

JHQHUDOOHGJHU:HUHFDOFXODWHGWKHSURYLVLRQVWR

ensure mathematical accuracy and consistency

RIDSSOLFDWLRQZLWKWKHPHWKRGRORJ\

We evaluated the reasonableness of

management’s estimates regarding the future

annual sales and the obsolescence percentage

applied by comparing these assumptions to

KLVWRULFDOVDOHVDQGKLVWRULFDOZULWHRࢆV:HIRXQG

WKHDVVXPSWLRQVWREHUHDVRQDEOH

We challenged manual overlays to the automated

calculation by validating the circumstances relating

to the adjustments or whether there was a right

RIUHWXUQXQGHUWKHFRQWUDFWXDODUUDQJHPHQWV

In assessing management’s consideration of

the estimation uncertainty within the inventory

obsolescence provisioning, we re-performed

management’s sensitivity assessment which

considered an increase and decrease in inventory

FRYHUGD\VDQGSURYLVLRQLQJUDWHV

%DVHGRQRXUDXGLWSURFHGXUHVLQFOXGLQJWKH

UHYLHZRIGLVFORVXUHVJLYHQLQ1RWHZHDJUHH

ZLWKWKHࢉJXUHVSUHVHQWHGDQGZLWKPDQDJHPHQWȆV

conclusions that based on the information

DYDLODEOHDWWKHWLPHRIWKH%RDUGȆVDSSURYDORI

the accounts, such sensitivities would not result

LQDPDWHULDOFKDQJHWRWKHLQYHQWRU\SURYLVLRQV

'HࢉQHGEHQHࢉWSHQVLRQVFKHPHOLDELOLWLHVȁ8.*URXS

5HIHUWRSDJH$XGLW&RPPLWWHH5HSRUWSDJH1RWH%DVLVRISUHSDUDWLRQ

DQGSDJHVWR1RWH5HWLUHPHQWEHQHࢉWREOLJDWLRQV

Key audit matter How our audit addressed the key audit matter

7KH*URXSKDVQHWUHWLUHPHQWEHQHࢉW

REOLJDWLRQVRIePLOOLRQDW0DUFK

ePLOOLRQZKLFKDUHVLJQLࢉFDQWLQ

WKHFRQWH[WRIWKHRYHUDOOEDODQFHVKHHW

7KHQHWUHWLUHPHQWEHQHࢉWREOLJDWLRQVLQ

UHVSHFWRIWKH8.VFKHPHLVePLOOLRQ

ePLOOLRQ7KLVLVDIWHUWKH

application of asset ceiling rules to the scheme

VXUSOXVRIePLOOLRQZKHUHE\WKLVLVUHVWULFWHG

to zero given that under the scheme rules there

is no unconditional right to a refund of surplus

WKDWPD\DULVHRQWKHVFKHPH$QDGGLWLRQDO

OLDELOLW\RIePLOOLRQKDVEHHQUHFRJQLVHGRQ

the balance sheet, which represents the present

YDOXHRIGHࢉFLWFRQWULEXWLRQVDJUHHGDWWKH

ODWHVWVWDWXWRU\IXQGLQJYDOXDWLRQ7KH

UHPDLQLQJePLOOLRQQHWUHWLUHPHQWEHQHࢉW

obligations are made up of immaterial amounts

LQUHVSHFWRIRWKHU(XURSHDQGHࢉQHGEHQHࢉW

SHQVLRQDQGUHWLUHPHQWLQGHPQLW\VFKHPHV

7KHYDOXDWLRQRISHQVLRQSODQOLDELOLWLHV

requires estimation in determining appropriate

assumptions such as salary increases, mortality

UDWHVGLVFRXQWUDWHVDQGLQࢊDWLRQOHYHOV

0RYHPHQWLQWKHVHDVVXPSWLRQVFDQKDYHD

material impact on the determination of the

OLDELOLWLHV0DQDJHPHQWXVHVH[WHUQDODFWXDULHV

WRDVVLVWLQGHWHUPLQLQJWKHVHDVVXPSWLRQV

We used our actuarial experts to assess

whether the assumptions used in calculating

WKHGHࢉQHGEHQHࢉWOLDELOLWLHVIRUWKH8.VFKHPH

and the application of the asset ceiling based on

UHYLHZRIVFKHPHUXOHVZHUHUHDVRQDEOH:H

challenged whether salary increases and

mortality rates assumptions were consistent with

WKHVSHFLࢉFVRIWKHSODQDQGZKHUHDSSOLFDEOH

ZLWKUHOHYDQWQDWLRQDOEHQFKPDUNV

We also assessed whether the discount rate and

LQࢊDWLRQUDWHVZHUHFRQVLVWHQWZLWKRXULQWHUQDOO\

GHYHORSHGEHQFKPDUNVDQGLQOLQHZLWKRWKHU

FRPSDQLHV:HHYDOXDWHGWKHFDOFXODWLRQV

prepared by the external actuaries to assess

the consistency of the assumptions and

PHWKRGRORJLHVDSSOLHG

%DVHGRQRXUSURFHGXUHVZHQRWHGWKDWWKH

assumptions in respect of future improvements

in mortality, discount rate and commutation

DVVXPSWLRQVDUHDWWKHPLGSRLQWRSWLPLVWLFHQG

RIDQDFFHSWDEOHUDQJH2YHUDOOZHFRQVLGHU

YDOXDWLRQRIWKH8.GHࢉQHGEHQHࢉWVFKHPH

OLDELOLWLHVWREHUHDVRQDEOH

:HUHYLHZHGWKHUHODWHGGLVFORVXUHVLQ1RWH

to the Group accounts which also included the

sensitivity analysis in respect of changes to

VLJQLࢉFDQWDVVXPSWLRQVDQGFRQVLGHUWKHVH

GLVFORVXUHVWREHDSSURSULDWH

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 121

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Independent Auditors’ report continued

)DLUYDOXHRIDFTXLUHGLQWDQJLEOHVȁ'LVWUHOHF*URXS

5HIHUWRSDJH$XGLW&RPPLWWHH5HSRUWSDJH1RWH%DVLVRISUHSDUDWLRQ

DQGSDJHVWR1RWH$FTXLVLWLRQV

Key audit matter How our audit addressed the key audit matter

2Q-XQHWKH*URXSFRPSOHWHGWKH

DFTXLVLWLRQRIRIWKHVKDUHFDSLWDORI

'LVWUHOHF%9DQGLWVVXEVLGLDULHV'LVWUHOHF

IRUSXUFKDVHFRQVLGHUDWLRQRIePLOOLRQ

7KHDFTXLVLWLRQUHVXOWHGLQWKHUHFRJQLWLRQRI

ePLOOLRQRILQWDQJLEOHDVVHWVDWWKH

acquisition date, primarily made up of goodwill

RIePLOOLRQFXVWRPHUUHODWLRQVKLSVRI

ePLOOLRQEUDQGVePLOOLRQDQGVRIWZDUH

RIePLOOLRQ

0DQDJHPHQWGHWHUPLQHGWKHDFTXLVLWLRQGDWH

fair values of intangible assets with the help of

H[WHUQDOYDOXDWLRQH[SHUWV7KHFDOFXODWLRQRI

these fair values involves judgements and

estimates regarding forecasts and other

DVVXPSWLRQVXVHGLQWKHYDOXDWLRQPRGHOV

We reviewed the share purchase agreement and

QRWHGQRXQXVXDOWHUPV

We agreed the consideration to the share purchase

DJUHHPHQWDQGWKHDPRXQWSDLGWREDQN

VWDWHPHQWV

We audited the assumptions and bases of the

valuations utilising the assistance of our specialist

YDOXDWLRQWHDPDQGSHUIRUPHGZRUNWRWHVWWKH

bases and mechanical accuracy of the models,

the application of the valuation methodology,

DSSURSULDWHQHVVRIWKHNH\DVVXPSWLRQVDQG

inputs applied, including discount rates, growth

rates, attrition rates of customers, royalty rates

DQGFRQWULEXWRU\DVVHWFKDUJHV%DVHGRQWKLV

ZRUNZHGLGQRWLGHQWLI\DQ\LVVXHV

:HKDYHUHYLHZHGWKHFDVKࢊRZIRUHFDVWVDQG

DJUHHGWKHVHEDFNWRࢉQDQFLDOIRUHFDVWVXVHG

LQWKHGXHGLOLJHQFH

We have performed an independent

recalculation of the overall weighted average

cost of capital (WACC) used in the valuation

models and found management’s WACC to

EHZLWKLQDUHDVRQDEOHUDQJH

We examined the disclosures in respect of

WKHDFTXLVLWLRQ1RWHDQGIRXQGWKHPWR

EHDSSURSULDWHSURYLGLQJDIDLUUHࢊHFWLRQRI

WKHDFFRXQWLQJ

2YHUDOOEDVHGRQRXUZRUNSHUIRUPHGZH

consider the fair values of acquired intangibles

and the related disclosures in the Group

DFFRXQWVWREHDSSURSULDWH

Carrying value of investments (Company)

5HIHUWRSDJH$XGLW&RPPLWWHH5HSRUWDQGSDJH1RWH,QYHVWPHQWV

LQVXEVLGLDULHVLQWKH&RPSDQ\DFFRXQWV

Key audit matter How our audit addressed the key audit matter

7KH&RPSDQ\KROGVLQYHVWPHQWVLQVXEVLGLDULHV

RIePLOOLRQDW0DUFK

ePLOOLRQ

Investments in subsidiaries are accounted for

at cost less provision for impairment in the

&RPSDQ\EDODQFHVKHHW,QYHVWPHQWVDUHWHVWHG

IRULPSDLUPHQWLILPSDLUPHQWLQGLFDWRUVH[LVW

If such indicators exist, the recoverable amounts

of investments in subsidiaries are estimated in

order to determine the extent of the impairment

ORVVLIDQ\$Q\VXFKLPSDLUPHQWORVVLV

UHFRJQLVHGLQWKHSURࢉWDQGORVVDFFRXQW

7KHLPSDLUPHQWDVVHVVPHQWZDVLGHQWLࢉHGDV

DNH\DXGLWPDWWHUJLYHQWKHVL]HRIWKH

underlying investment carrying values in the

&RPSDQ\DFFRXQWVDW0DUFK7KH

assessment requires the application of

management judgement, particularly in

determining whether any impairment indicators

have arisen that trigger the need for an

impairment assessment and in assessing

whether the carrying value of each investment

FDQEHVXSSRUWHGE\LWVUHFRYHUDEOHDPRXQW

We evaluated management’s assessment of

whether any indicators of impairment existed by

comparing the carrying values of investments in

subsidiaries to the net assets of the underlying

VXEVLGLDULHVDW0DUFKDQGQRLPSDLUPHQW

LQGLFDWRUVZHUHQRWHG

%DVHGRQWKHSURFHGXUHVSHUIRUPHGZHFRQFXU

with management that there are no indicators of

LPSDLUPHQWLQUHVSHFWRILQYHVWPHQWLQVXEVLGLDULHV

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 122

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

How we tailored the audit scope

We tailored the scope of our audit to ensure that

ZHSHUIRUPHGHQRXJKZRUNWREHDEOHWRJLYH

DQRSLQLRQRQWKHDFFRXQWVDVDZKROHWDNLQJ

into account the structure of the Group and the

Company, the accounting processes and controls,

DQGWKHLQGXVWU\LQZKLFKWKH\RSHUDWH

7KH*URXSȆVDFFRXQWLQJSURFHVVLVVWUXFWXUHG

DURXQGDORFDOࢉQDQFHIXQFWLRQLQPRVWRIWKH

*URXSȆVFRXQWU\UHSRUWLQJFRPSRQHQWV7KHVH

functions maintain their own accounting records

and controls (although transactional processing

and certain controls for many reporting

components are performed at the Group’s

(0($$PHULFDVDQG$VLD3DFLࢉFJOREDOVKDUHG

business service centres) and report to the head

RࢇFHࢉQDQFHWHDPWKURXJKDQLQWHJUDWHG

FRQVROLGDWLRQV\VWHP

In establishing the overall approach to the Group

audit, we determined that we needed to conduct

DXGLWZRUNRYHUWKHFRPSOHWHࢉQDQFLDOLQIRUPDWLRQ

of RS UK, RS Germany, RS France, RS Italy,

566KDQJKDL56$PHULFDVDQG56*URXSSOF

In each country we used PwC component auditors

WRDXGLWDQGUHSRUWRQWKHDJJUHJDWHGࢉQDQFLDO

LQIRUPDWLRQRIWKDWUHSRUWLQJFRPSRQHQW7KLV

ZRUNLVVXSSOHPHQWHGE\DXGLWSURFHGXUHVRYHU

VSHFLࢉFEDODQFHVSHUIRUPHGRQ56,QWHJUDWHG

Supply UK, RS Integrated Supply US, Risoul,

'LVWUHOHF6ZLW]HUODQG%RGHQIHOGDQGSURFHGXUHV

performed centrally on the Group consolidation,

accounts disclosures, taxation, Group annual

incentive accrual, goodwill, acquired intangibles,

VKDUHEDVHGSD\PHQWV8.UHWLUHPHQWEHQHࢉW

obligations, acquisition accounting and certain

reporting component balances not covered by

ORFDOFRXQWU\FRPSRQHQWWHDPV

:KHUHWKHZRUNZDVSHUIRUPHGE\FRPSRQHQW

auditors, under our instruction, we determined the

level of involvement we needed to have in the audit

ZRUNDWWKRVHUHSRUWLQJFRPSRQHQWVWREHDEOHWR

FRQFOXGHZKHWKHUVXࢇFLHQWDSSURSULDWHDXGLW

evidence had been obtained as a basis for our

RSLQLRQRQWKH*URXSDFFRXQWVDVDZKROH:H

maintained regular communication with the local

WHDPVEHIRUHGXULQJDQGDIWHUWKHLUDXGLW:H

GLUHFWHGWKHZRUNRIFRPSRQHQWWHDPVUHYLHZHG

WKHLUDSSURDFKDQGࢉQGLQJVDQGSDUWLFLSDWHGLQ

WKHFORVLQJPHHWLQJVRIWKHVLJQLࢉFDQWDQGPDWHULDO

UHSRUWLQJFRPSRQHQWV

7KHUHSRUWLQJFRPSRQHQWVWKDWDUHSDUWRIRXU

DXGLWVFRSHDVVHWRXWWRWKHOHIWDFFRXQWIRURI

*URXSUHYHQXHDQGRI*URXSSURࢉWEHIRUHWD[

substantial reorganisation costs, substantial asset

ZULWHGRZQVDQGDFTXLVLWLRQUHODWHGLWHPV

The impact of climate risk on our audit

As part of our audit procedures, we have

considered the potential impact of climate change

RQWKH*URXSȆVEXVLQHVVDQGLWVDFFRXQWV

7KH*URXSFRQWLQXHVWRGHYHORSLWVDVVHVVPHQWRI

the potential impacts of climate change as

explained throughout the Strategic Report and in

PRUHGHWDLORQSDJHVWRDQGSDJHVWR

As part of our audit, we have obtained

PDQDJHPHQWȆVFOLPDWHUHODWHGULVNDVVHVVPHQW

and held discussions with management, together

with our own climate change experts, to

understand the process of identifying climate

UHODWHGULVNVWKHGHWHUPLQDWLRQRIPLWLJDWLQJ

DFWLRQVDQGWKHLPSDFWRQWKH*URXSȆVDFFRXQWV

0DQDJHPHQWKDVDVVHVVHGWKDWWKHPRVWOLNHO\

impacted accounts line items and estimates are

WKRVHDVVRFLDWHGZLWKIXWXUHFDVKࢊRZVVLQFHWKH

impact of climate change is expected to become

PRUHQRWDEOHLQWKHPHGLXPWRORQJWHUP

:KLOHDXGLWLQJWKHVHIRUHFDVWFDVKࢊRZVZHKDYH

FKDOOHQJHGPDQDJHPHQWRQUHࢊHFWLQJWKHLPSDFW

of climate change and any climate change related

FRPPLWPHQWVLQWKHIRUHFDVWV

:HKDYHQRWLGHQWLࢉHGDQ\PDWWHUVDVSDUWRIWKLV

ZRUNZKLFKDUHLQFRQVLVWHQWZLWKWKHGLVFORVXUHVLQ

the Annual Report or would lead to any material

DGMXVWPHQWVWRWKHDFFRXQWV

Materiality

7KHVFRSHRIRXUDXGLWZDVLQࢊXHQFHGE\RXUDSSOLFDWLRQRIPDWHULDOLW\:HVHWFHUWDLQTXDQWLWDWLYH

WKUHVKROGVIRUPDWHULDOLW\7KHVHWRJHWKHUZLWKTXDOLWDWLYHFRQVLGHUDWLRQVKHOSHGXVWRGHWHUPLQHWKH

VFRSHRIRXUDXGLWDQGWKHQDWXUHWLPLQJDQGH[WHQWRIRXUDXGLWSURFHGXUHVRQWKHLQGLYLGXDOࢉQDQFLDO

VWDWHPHQWOLQHLWHPVDQGGLVFORVXUHVDQGLQHYDOXDWLQJWKHHࢆHFWRIPLVVWDWHPHQWVERWKLQGLYLGXDOO\DQG

LQDJJUHJDWHRQWKHDFFRXQWVDVDZKROH

%DVHGRQRXUSURIHVVLRQDOMXGJHPHQWZHGHWHUPLQHGPDWHULDOLW\IRUWKHDFFRXQWVDVDZKROHDVIROORZV

$FFRXQWVȁ*URXS $FFRXQWVȁ&RPSDQ\

Overall materiality ePLOOLRQePLOOLRQ ePLOOLRQePLOOLRQ

How we determined it RI*URXSSURࢉWEHIRUHWD[

substantial reorganisation costs,

substantial asset write-downs and

acquisition-related items

RIQHWDVVHWV

Rationale for

benchmark applied

3URࢉWEHIRUHWD[DGMXVWHGIRU

RQHRࢆLWHPVLVWKHNH\PHDVXUH

used by the shareholders as a

body in assessing the Group’s

SHUIRUPDQFH:HFRQVLGHUWKDW

excluding the substantial

reorganisation costs, substantial

asset write-downs and acquisition-

related items is appropriate as this

provides us with a consistent

year-on-year basis for determining

materiality by eliminating the

QRQUHFXUULQJLPSDFWRIWKHVHLWHPV

Net assets is the primary measure

used by the shareholders in

assessing the performance and

SRVLWLRQRIWKHHQWLW\DVLWUHࢊHFWV

the Company’s principal activity as a

holding company and is a generally

DFFHSWHGDXGLWLQJEHQFKPDUN

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 123

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Independent Auditors’ report continued

For each component in the scope of our Group

audit, we allocated a materiality that is less than

RXURYHUDOO*URXSPDWHULDOLW\7KHUDQJHRI

materiality allocated across components was

EHWZHHQePLOOLRQDQGePLOOLRQ&HUWDLQ

components were audited to a local statutory

audit materiality that was also less than our

RYHUDOO*URXSPDWHULDOLW\

We use performance materiality to reduce to an

appropriately low level the probability that the

aggregate of uncorrected and undetected

PLVVWDWHPHQWVH[FHHGVRYHUDOOPDWHULDOLW\

6SHFLࢉFDOO\ZHXVHSHUIRUPDQFHPDWHULDOLW\LQ

determining the scope of our audit and the nature

and extent of our testing of account balances,

classes of transactions and disclosures, for

H[DPSOHLQGHWHUPLQLQJVDPSOHVL]HV2XU

SHUIRUPDQFHPDWHULDOLW\ZDV

RIRYHUDOOPDWHULDOLW\DPRXQWLQJWRePLOOLRQ

ePLOOLRQIRUWKH*URXSDFFRXQWV

DQGePLOOLRQePLOOLRQIRUWKH

&RPSDQ\DFFRXQWV

In determining the performance materiality, we

considered a number of factors – the history of

PLVVWDWHPHQWVULVNDVVHVVPHQWDQGDJJUHJDWLRQ

ULVNDQGWKHHࢆHFWLYHQHVVRIFRQWUROVȁDQG

concluded that an amount at the upper end of our

QRUPDOUDQJHZDVDSSURSULDWH

We agreed with the Audit Committee that we

ZRXOGUHSRUWWRWKHPPLVVWDWHPHQWVLGHQWLࢉHG

GXULQJRXUDXGLWDERYHePLOOLRQ*URXSDXGLW

ePLOOLRQDQGePLOOLRQ

&RPSDQ\DXGLWePLOOLRQDV

well as misstatements below those amounts

that, in our view, warranted reporting for

TXDOLWDWLYHUHDVRQV

Conclusions relating to going concern

Our evaluation of the Directors’ assessment

of the Group’s and the Company’s ability to

continue to adopt the going concern basis

of accounting included:

– XQGHUVWDQGLQJRIWKHPHFKDQLFVDQGNH\LQSXWV

into the going concern model and holding

discussions with Group management and

UHJLRQDOࢉQDQFHWRREWDLQDQXQGHUVWDQGLQJ

RIWKHWUDGLQJSHUIRUPDQFHDQGIXWXUHRXWORRN

IRUWKHLUUHVSHFWLYHPDUNHWV

– HYDOXDWLQJWKHNH\DVVXPSWLRQVZLWKLQ

the forecasts;

– reviewing the terms of the existing debt

and facilities;

– considering the potential downside sensitivities

that management had applied and their

OLNHOLKRRGDQGZKHWKHUPRUHVHYHUHVFHQDULRV

could apply and the associated impact on

available liquidity;

– assessing management’s stress testing and

whether this appropriately considered the

SULQFLSDOULVNVIDFLQJWKHEXVLQHVVDQGWKH

OLNHOLKRRGRIHYHQWVDULVLQJWKDWFRXOGHURGH

liquidity and breach covenants within the

forecast period; and

– reviewing the disclosures within the Annual

Report and validating that it accurately described

PDQDJHPHQWȆVJRLQJFRQFHUQFRQVLGHUDWLRQV

%DVHGRQWKHZRUNZHKDYHSHUIRUPHGZHKDYH

QRWLGHQWLࢉHGDQ\PDWHULDOXQFHUWDLQWLHVUHODWLQJ

to events or conditions that, individually or

FROOHFWLYHO\PD\FDVWVLJQLࢉFDQWGRXEWRQWKH

Group’s and the Company’s ability to continue

as a going concern for a period of at least twelve

months from when the accounts are authorised

IRULVVXH

In auditing the accounts, we have concluded that

the Directors’ use of the going concern basis of

accounting in the preparation of the accounts

LVDSSURSULDWH

However, because not all future events or

conditions can be predicted, this conclusion

is not a guarantee as to the Group’s and the

&RPSDQ\ȆVDELOLW\WRFRQWLQXHDVDJRLQJFRQFHUQ

In relation to the Directors’ reporting on how they

have applied the UK Corporate Governance Code,

we have nothing material to add or draw attention

to in relation to the Directors’ statement in the

accounts about whether the Directors considered

it appropriate to adopt the going concern basis

RIDFFRXQWLQJ

Our responsibilities and the responsibilities of

the Directors with respect to going concern are

GHVFULEHGLQWKHUHOHYDQWVHFWLRQVRIWKLVUHSRUW

Reporting on other information

7KHRWKHULQIRUPDWLRQFRPSULVHVDOORIWKH

information in the Annual Report other than the

DFFRXQWVDQGRXUDXGLWRUVȆUHSRUWWKHUHRQ7KH

Directors are responsible for the other

LQIRUPDWLRQ2XURSLQLRQRQWKHDFFRXQWVGRHV

not cover the other information and, accordingly,

we do not express an audit opinion or, except to

the extent otherwise explicitly stated in this report,

DQ\IRUPRIDVVXUDQFHWKHUHRQ

In connection with our audit of the accounts, our

responsibility is to read the other information and,

in doing so, consider whether the other

information is materially inconsistent with the

DFFRXQWVRURXUNQRZOHGJHREWDLQHGLQWKHDXGLW

RURWKHUZLVHDSSHDUVWREHPDWHULDOO\PLVVWDWHG,I

we identify an apparent material inconsistency or

material misstatement, we are required to perform

procedures to conclude whether there is a material

misstatement of the accounts or a material

PLVVWDWHPHQWRIWKHRWKHULQIRUPDWLRQ,IEDVHG

RQWKHZRUNZHKDYHSHUIRUPHGZHFRQFOXGH

that there is a material misstatement of this

other information, we are required to report

WKDWIDFW:HKDYHQRWKLQJWRUHSRUWEDVHGRQ

WKHVHUHVSRQVLELOLWLHV

With respect to the Strategic report and Directors’

Report, we also considered whether the

disclosures required by the UK Companies Act

KDYHEHHQLQFOXGHG

%DVHGRQRXUZRUNXQGHUWDNHQLQWKHFRXUVHRI

WKHDXGLWWKH&RPSDQLHV$FWUHTXLUHVXV

also to report certain opinions and matters as

GHVFULEHGEHORZ

Strategic report and Directors’ report

,QRXURSLQLRQEDVHGRQWKHZRUNXQGHUWDNHQLQ

the course of the audit, the information given in

the Strategic report and Directors’ report for the

\HDUHQGHG0DUFKLVFRQVLVWHQWZLWKWKH

accounts and has been prepared in accordance

ZLWKDSSOLFDEOHOHJDOUHTXLUHPHQWV

,QOLJKWRIWKHNQRZOHGJHDQGXQGHUVWDQGLQJRI

the Group and Company and their environment

obtained in the course of the audit, we did not

identify any material misstatements in the

6WUDWHJLFUHSRUWDQG'LUHFWRUVȆUHSRUW

Directors’ Remuneration

In our opinion, the part of the Directors’

Remuneration report to be audited has been

properly prepared in accordance with the

&RPSDQLHV$FW

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 124

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Corporate governance statement

7KH/LVWLQJ5XOHVUHTXLUHXVWRUHYLHZWKH'LUHFWRUVȆ

statements in relation to going concern,

longer-term viability and that part of the corporate

governance statement relating to the Company’s

compliance with the provisions of the UK

&RUSRUDWH*RYHUQDQFH&RGHVSHFLࢉHGIRURXU

UHYLHZ2XUDGGLWLRQDOUHVSRQVLELOLWLHVZLWKUHVSHFW

to the corporate governance statement as other

information are described in the Reporting on

RWKHULQIRUPDWLRQVHFWLRQRIWKLVUHSRUW

%DVHGRQWKHZRUNXQGHUWDNHQDVSDUWRIRXUDXGLW

we have concluded that each of the following

elements of the corporate governance statement

is materially consistent with the accounts and our

NQRZOHGJHREWDLQHGGXULQJWKHDXGLWDQGZHKDYH

nothing material to add or draw attention to in

relation to:

– 7KH'LUHFWRUVȆFRQࢉUPDWLRQWKDWWKH\KDYH

carried out a robust assessment of the emerging

DQGSULQFLSDOULVNV

– 7KHGLVFORVXUHVLQWKH$QQXDO5HSRUWWKDW

GHVFULEHWKRVHSULQFLSDOULVNVZKDWSURFHGXUHV

DUHLQSODFHWRLGHQWLI\HPHUJLQJULVNVDQGDQ

explanation of how these are being managed

or mitigated;

– 7KH'LUHFWRUVȆVWDWHPHQWLQWKHDFFRXQWVDERXW

whether they considered it appropriate to

adopt the going concern basis of accounting

LQSUHSDULQJWKHPDQGWKHLULGHQWLࢉFDWLRQRI

any material uncertainties to the Group’s and

Company’s ability to continue to do so over a

period of at least twelve months from the date

of approval of the accounts;

– 7KH'LUHFWRUVȆH[SODQDWLRQDVWRWKHLUDVVHVVPHQW

of the Group’s and Company’s prospects, the

period this assessment covers and why the

period is appropriate; and

– 7KH'LUHFWRUVȆVWDWHPHQWDVWRZKHWKHUWKH\KDYH

a reasonable expectation that the Company will

be able to continue in operation and meet its

liabilities as they fall due over the period of its

assessment, including any related disclosures

GUDZLQJDWWHQWLRQWRDQ\QHFHVVDU\TXDOLࢉFDWLRQV

RUDVVXPSWLRQV

Our review of the Directors’ statement regarding

the longer-term viability of the Group and

Company was substantially less in scope than an

DXGLWDQGRQO\FRQVLVWHGRIPDNLQJLQTXLULHVDQG

considering the Directors’ process supporting their

VWDWHPHQWFKHFNLQJWKDWWKHVWDWHPHQWLVLQ

alignment with the relevant provisions of the UK

Corporate Governance Code; and considering

whether the statement is consistent with the

DFFRXQWVDQGRXUNQRZOHGJHDQGXQGHUVWDQGLQJ

of the Group and Company and their environment

REWDLQHGLQWKHFRXUVHRIWKHDXGLW

,QDGGLWLRQEDVHGRQWKHZRUNXQGHUWDNHQDVSDUW

of our audit, we have concluded that each of the

following elements of the corporate governance

statement is materially consistent with the

DFFRXQWVDQGRXUNQRZOHGJHREWDLQHGGXULQJ

the audit:

– 7KH'LUHFWRUVȆVWDWHPHQWWKDWWKH\FRQVLGHUWKH

$QQXDO5HSRUWWDNHQDVDZKROHLVIDLUEDODQFHG

and understandable, and provides the

information necessary for the members to

assess the Group’s and Company’s position,

performance, business model and strategy;

– 7KHVHFWLRQRIWKH$QQXDO5HSRUWWKDWGHVFULEHV

WKHUHYLHZRIHࢆHFWLYHQHVVRIULVNPDQDJHPHQW

and internal control systems; and

– 7KHVHFWLRQRIWKH$QQXDO5HSRUWGHVFULELQJ

WKHZRUNRIWKH$XGLW&RPPLWWHH

We have nothing to report in respect of our

responsibility to report when the Directors’

statement relating to the Company’s compliance

with the Code does not properly disclose

a departure from a relevant provision of the

&RGHVSHFLࢉHGXQGHUWKH/LVWLQJ5XOHVIRUUHYLHZ

E\WKHDXGLWRUV

Responsibilities for the accounts and the audit

Responsibilities of the Directors for the accounts

As explained more fully in the Statement of

Directors’ responsibilities, the Directors are

responsible for the preparation of the accounts

LQDFFRUGDQFHZLWKWKHDSSOLFDEOHIUDPHZRUNDQG

IRUEHLQJVDWLVࢉHGWKDWWKH\JLYHDWUXHDQGIDLU

YLHZ7KH'LUHFWRUVDUHDOVRUHVSRQVLEOHIRUVXFK

internal control as they determine is necessary

to enable the preparation of accounts that are

free from material misstatement, whether due

WRIUDXGRUHUURU

In preparing the accounts, 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

WRGRVR

Auditors’ responsibilities for the audit

of the accounts

Our objectives are to obtain reasonable assurance

about whether the accounts as a whole are free

from material misstatement, whether due to fraud

or error, and to issue an auditors’ report that

LQFOXGHVRXURSLQLRQ5HDVRQDEOHDVVXUDQFHLVD

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

H[LVWV0LVVWDWHPHQWVFDQDULVHIURPIUDXGRUHUURU

and are considered material if, individually or in the

aggregate, they could reasonably be expected to

LQࢊXHQFHWKHHFRQRPLFGHFLVLRQVRIXVHUVWDNHQ

RQWKHEDVLVRIWKHVHDFFRXQWV

Irregularities, including fraud, are instances of

QRQFRPSOLDQFHZLWKODZVDQGUHJXODWLRQV:H

design procedures in line with our responsibilities,

outlined above, to detect material misstatements

LQUHVSHFWRILUUHJXODULWLHVLQFOXGLQJIUDXG7KH

extent to which our procedures are capable

of detecting irregularities, including fraud, is

GHWDLOHGEHORZ

%DVHGRQRXUXQGHUVWDQGLQJRIWKH*URXSDQG

LQGXVWU\ZHLGHQWLࢉHGWKDWWKHSULQFLSDOULVNVRI

non-compliance with laws and regulations related to

/LVWLQJ5XOHVRIWKH)LQDQFLDO&RQGXFW$XWKRULW\)&$

and pensions legislations, and we considered the

extent to which non-compliance might have

DPDWHULDOHࢆHFWRQWKHDFFRXQWV:HDOVR

considered those laws and regulations that

have a direct impact on the accounts such as the

&RPSDQLHV$FWDQGWKH8.DQGRWKHUUHOHYDQW

WD[OHJLVODWLRQ:HHYDOXDWHGPDQDJHPHQWȆV

incentives and opportunities for fraudulent

PDQLSXODWLRQRIWKHDFFRXQWVLQFOXGLQJWKHULVN

of override of controls), and determined that

WKHSULQFLSDOULVNVZHUHUHODWHGWRSRVWLQJ

LQDSSURSULDWHMRXUQDOHQWULHVWRPDQLSXODWHࢉQDQFLDO

results and management bias in accounting

HVWLPDWHV7KH*URXSHQJDJHPHQWWHDPVKDUHGWKLV

ULVNDVVHVVPHQWZLWKWKHFRPSRQHQWDXGLWRUVVR

that they could include appropriate audit procedures

LQUHVSRQVHWRVXFKULVNVLQWKHLUZRUN$XGLW

procedures performed by the Group engagement

WHDPDQGRUFRPSRQHQWDXGLWRUVLQFOXGHG

– discussions with management, legal counsel

and the internal audit function, including

FRQVLGHUDWLRQRINQRZQRUVXVSHFWHGLQVWDQFHV

of non-compliance with laws and regulations

and fraud;

– assessment of matters reported on the Group’s

whistleblowing helpline and results of

management’s investigation of such matters;

– challenging assumptions made by management

LQLWVVLJQLࢉFDQWDQGRWKHUNH\DFFRXQWLQJ

HVWLPDWHVLQSDUWLFXODULQUHODWLRQWRGHࢉQHG

EHQHࢉWSHQVLRQVFKHPHOLDELOLWLHVDQGLQYHQWRU\

obsolescence provisions;

– LGHQWLI\LQJDQGWHVWLQJKLJKHUULVNMRXUQDOHQWULHV

in particular any journal entries posted with

unusual account combinations, journals posted

by senior management, or unauthorised users or

super-user access and consolidation journals;

– reviewing internal audit reports and minutes of

meetings with those charged with governance;

and minutes of meetings with those charged

with governance; and

– reviewing accounts disclosures and testing to

supporting documentation to assess compliance

ZLWKDSSOLFDEOHODZVDQGUHJXODWLRQV

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 125

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Independent Auditors’ report continued

7KHUHDUHLQKHUHQWOLPLWDWLRQVLQWKHDXGLW

SURFHGXUHVGHVFULEHGDERYH:HDUHOHVVOLNHO\WR

become aware of instances of non-compliance

with laws and regulations that are not closely

UHODWHGWRHYHQWVDQGWUDQVDFWLRQVUHࢊHFWHGLQWKH

DFFRXQWV$OVRWKHULVNRIQRWGHWHFWLQJDPDWHULDO

PLVVWDWHPHQWGXHWRIUDXGLVKLJKHUWKDQWKHULVN

of not detecting one resulting from error, as

fraud may involve deliberate concealment by,

for example, forgery or intentional

PLVUHSUHVHQWDWLRQVRUWKURXJKFROOXVLRQ

Our audit testing might include testing complete

populations of certain transactions and balances,

SRVVLEO\XVLQJGDWDDXGLWLQJWHFKQLTXHV+RZHYHU

it typically involves selecting a limited number of

items for testing, rather than testing complete

SRSXODWLRQV:HZLOORIWHQVHHNWRWDUJHWSDUWLFXODU

LWHPVIRUWHVWLQJEDVHGRQWKHLUVL]HRUULVN

FKDUDFWHULVWLFV,QRWKHUFDVHVZHZLOOXVHDXGLW

sampling to enable us to draw a conclusion about

WKHSRSXODWLRQIURPZKLFKWKHVDPSOHLVVHOHFWHG

A further description of our responsibilities for the

audit of the accounts is located on the FRC’s

ZHEVLWHDWZZZIUFRUJXNDXGLWRUVUHVSRQVLELOLWLHV

7KLVGHVFULSWLRQIRUPVSDUWRIRXUDXGLWRUVȆUHSRUW

8VHRIWKLVUHSRUW

7KLVUHSRUWLQFOXGLQJWKHRSLQLRQVKDVEHHQ

prepared for and only for the Company’s members

DVDERG\LQDFFRUGDQFHZLWK&KDSWHURI3DUW

RIWKH&RPSDQLHV$FWDQGIRUQRRWKHU

SXUSRVH:HGRQRWLQJLYLQJWKHVHRSLQLRQV

accept or assume responsibility for any other

purpose or to any other person to whom this

report is shown or into whose hands it may

come save where expressly agreed by our prior

FRQVHQWLQZULWLQJ

Other required reporting

Companies Act 2006 exception reporting

8QGHUWKH&RPSDQLHV$FWZHDUHUHTXLUHG

to report to you if, in our opinion:

– we have not obtained all the information and

explanations we require for our audit; or

– adequate accounting records have not been

NHSWE\WKH&RPSDQ\RUUHWXUQVDGHTXDWHIRU

our audit have not been received from branches

not visited by us; or

– certain disclosures of Directors’ remuneration

VSHFLࢉHGE\ODZDUHQRWPDGHRU

– the Company accounts and the part of the

Directors’ Remuneration report to be audited are

not in agreement with the accounting

records and returns; or

– a corporate governance statement has not been

SUHSDUHGE\WKH&RPSDQ\

We have no exceptions to report arising from

WKLVUHVSRQVLELOLW\

Appointment

Following the recommendation of the Audit

Committee, we were appointed by the members

RQ$XJXVWWRDXGLWWKHDFFRXQWVIRUWKH

\HDUHQGHG0DUFKDQGVXEVHTXHQW

ࢉQDQFLDOSHULRGV7KHSHULRGRIWRWDOXQLQWHUUXSWHG

HQJDJHPHQWLV\HDUVFRYHULQJWKH\HDUVHQGHG

0DUFKWR0DUFK

Other matter

7KH&RPSDQ\LVUHTXLUHGE\WKH)LQDQFLDO&RQGXFW

$XWKRULW\'LVFORVXUH*XLGDQFHDQG7UDQVSDUHQF\

Rules to include these accounts in an annual

ࢉQDQFLDOUHSRUWSUHSDUHGXQGHUWKHVWUXFWXUHG

GLJLWDOIRUPDWUHTXLUHGE\'755ȁ5DQG

ࢉOHGRQWKH1DWLRQDO6WRUDJH0HFKDQLVPRIWKH

)LQDQFLDO&RQGXFW$XWKRULW\7KLVDXGLWRUVȆUHSRUW

provides no assurance over whether the

VWUXFWXUHGGLJLWDOIRUPDWDQQXDOࢉQDQFLDOUHSRUW

has been prepared in accordance with those

UHTXLUHPHQWV

Sandeep Dhillon (Senior Statutory Auditor)

IRUDQGRQEHKDOIRI3ULFHZDWHUKRXVH&RRSHUV//3

Chartered Accountants and Statutory Auditors

/RQGRQ

0D\

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 126

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

GROUP INCOME STATEMENT GROUP STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 March 2024 For the year ended 31 March 2024

Notes

		2024	2023
		£m	£m
Revenue	2,3,4	2,942.4	2,982.3
Cost of sales	5	(1,678.5)	(1,630.1)
Gross profit		1,263.9	1,352.2
Operating costs	6	(983.8)	(969.2)
Operating profit	2,3	280.1	383.0
Finance income	7	4.8	2.0
Finance costs	7	(36.7)	(14.2)
Share of profit of joint venture	17	0.6	0.7
Profit before tax		248.8	371.5
Income tax expense	11	(65.1)	(86.7)
Profit for the year attributable to owners of the Company		183.7	284.8
Earnings per share attributable to owners of the Company
Basic	12	38.8p	60.4p
Diluted	12	38.7p	60.2p

The Notes on pages 131 to 172 form part of these Group accounts.

Notes

		2024	2023
		£m	£m
Profit for the year		183.7	284.8
Other comprehensive income
Items that will not be reclassified subsequently to the income statement
Remeasurement of retirement benefit obligations	10	0.8	(34.2)
Related income tax	11	(0.1)	7.9
		0.7	(26.3)
Items that may be reclassified subsequently to the income statement
Foreign exchange translation differences of joint venture	17	(0.2)	(0.1)
Foreign exchange translation differences		(3.9)	43.1
Fair value gain on net investment hedges	23	3.4	5.4
Movement in cash flow hedges	27	(0.1)	3.9
Related income tax	11	–	(0.7)
		(0.8)	51.6
Other comprehensive (expense) / income for the year		(0.1)	25.3
Total comprehensive income for the year		183.6	310.1
Total comprehensive income is attributable to:
Owners of the Company		183.7	310.1
Non-controlling interests		(0.1)	–
		183.6	310.1

The Notes on pages 131 to 172 form part of these Group accounts.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 127

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts

GROUP BALANCE SHEET

As at 31 March 2024

Company number: 647788

Notes

		2024	2023
		£m	£m
Non-current assets
Intangible assets	14	982.6	704.8
Property, plant and equipment	15	180.9	186.3
Right-of-use assets	16	72.8	46.9
Investment in joint venture	17	1.3	1.5
Other receivables	19	8.4	6.5
Retirement benefit net assets	10	1.5	0.8
Deferred tax assets	11	9.5	6.9
Total non-current assets		1,257.0	953.7
Current assets
Inventories	18	656.0	616.3
Trade and other receivables	19	701.4	692.0
Cash and cash equivalents – cash and short-term deposits	22	258.7	260.3
Derivative assets	21	2.6	1.8
Current income tax receivables		22.7	19.9
Total current assets		1,641.4	1,590.3
Total assets		2,898.4	2,544.0
Current liabilities
Trade and other pa y ables	20	(602.7)	(658.9)
Cash and cash equivalents – bank overdrafts	22	(162.7)	(139.8)
Lease liabilities	16,22	(16.0)	(14.6)
Derivative liabilities	21	(1.1)	(1.7)
Provisions	24	(5.0)	(1.8)
Current income tax liabilities		(27.8)	(22.1)
Total current liabilities		(815.3)	(838.9)

Notes

		2024	2023
		£m	£m
Non-current liabilities
Other payables	20	(17.3)	(9.3)
Retirement benefit obligations	10	(27.2)	(37.2)
Borrowings	22	(440.3)	(184.6)
Lease liabilities	16,22	(57.9)	(34.3)
Provisions	24	(4.2)	(4.7)
Deferred tax liabilities	11	(103.3)	(90.1)
Total non-current liabilities		(650.2)	(360.2)
Total liabilities		(1,465.5)	(1,199.1)
Net assets		1,432.9	1,344.9
Equity
Share capital and share premium	26	286.9	283.3
Own shares held by Employee Benefit Trust (EBT)	26	(1.8)	(2.2)
Other reserves	27	108.3	108.8
Retained earnings		1,038.9	954.3
Equity attributable to owners of the Company		1,432.3	1,344.2
Non-controlling interests		0.6	0.7
Total equity		1,432.9	1,344.9

The Notes on pages 131 to 172 form part of these Group accounts.

These Group accounts were approved by the Board of Directors on 22 May 2024 and signed

on its behalf by:

Kate Ringrose

Chief Financial Officer

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 128

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

GROUP CASH FLOW STATEMENT

For the year ended 31 March 2024

Notes

		2024	2023
		£m	£m
Cash flows from operating activities
Profit before tax		248.8	371.5
Depreciation and amortisation	6	83.7	64.6
Impairment of intangible assets	14	4.6	7.1
Impairment of right-of-use assets		0.4	–
Loss on disposal of non-current assets	6	1.6	4.4
Equity-settled share-based payments	8,9	7.8	14.2
Net finance costs		31.9	12.2
Share of profit of and dividends received from joint venture	17	–	(0.1)
Decrease / (increase) in inventories		4.9	(44.3)
Decrease / (increase) in trade and other receivables		8.1	(37.8)
(Decrease) / increase in trade and other payables		(82.2)	33.2
Increase / (decrease) in provisions		1.1	(1.4)
Defined benefit retirement contributions in excess of charge		(9.8)	(10.6)
Cash generated from operations		300.9	413.0
Interest received		4.8	2.0
Interest paid		(35.8)	(14.6)
Income tax paid		(73.3)	(93.9)
Net cash from operating activities		196.6	306.5
Cash flows from investing activities
Acquisition of businesses	29	(313.1)	(237.2)
Cash and cash equivalents acquired with businesses	29	9.0	12.7
Total cash impact on acquisition of businesses		(304.1)	(224.5)
Purchase of intangible assets		(35.7)	(27.5)
Purchase of property, plant and equipment		(15.9)	(18.6)
Proceeds on sale of property, plant and equipment		–	0.1
Net cash used in investing activities		(355.7)	(270.5)

Notes

		2024	2023
		£m	£m
Cash flows from financing activities
Proceeds from the issue of share capital	26	3.6	4.8
Purchase of own shares by EBT		(1.5)	(2.1)
Loans drawn down		286.7	83.2
Loans repaid		(27.3)	(58.1)
Principal elements of lease payments		(18.5)	(18.8)
Dividends paid	13	(104.1)	(88.6)
Net cash generated from / (used in) financing activities		138.9	(79.6)
Net decrease in cash and cash equivalents		(20.2)	(43.6)
Cash and cash equivalents at the beginning of the year		120.5	158.4
Effect of exchange rate changes		(4.3)	5.7
Cash and cash equivalents at the end of the year	22	96.0	120.5

The Notes on pages 131 to 172 form part of these Group accounts.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 129

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

GROUP STATEMENT OF CHANGES IN EQUITY

For the year ended 31 March 2024

				Attributable to owners of the Company
	Share capital and
	share premium	Own shares held	Other reserves			Non-controlling
	(Note 26)	by EBT	(Note 27)	Retained earnings	Total	interests	Total equity
	£m	£m	£m	£m	£m	£m	£m
At 1 April 2022	278.5	(3.0)	60.2	772.8	1,108.5	–	1,108.5
Profit for the year	–	–	–	284.8	284.8	–	284.8
Other comprehensive income	–	–	51.6	(26.3)	25.3	–	25.3
Total comprehensive income	–	–	51.6	258.5	310.1	–	310.1
Cash flow hedging gains transferred to inventories	–	–	(3.7)	–	(3.7)	–	(3.7)
Tax on cash flow hedging gains transferred to inventories	–	–	0.7	–	0.7	–	0.7
Dividends (Note 13)	–	–	–	(88.6)	(88.6)	–	(88.6)
Equity-settled share-based payments (Notes 8 and 9)	–	–	–	14.2	14.2	–	14.2
Settlement of share awards	4.8	2.9	–	(2.9)	4.8	–	4.8
Purchase of own shares by EBT	–	(2.1)	–	–	(2.1)	–	(2.1)
Tax on equity-settled share-based payments	–	–	–	1.0	1.0	–	1.0
Sale of subsidiary’s shares to non-controlling interests	–	–	–	(0.7)	(0.7)	0.7	–
At 31 March 2023	283.3	(2.2)	108.8	954.3	1,344.2	0.7	1,344.9
Profit for the year	–	–	–	183.7	183.7	–	183.7
Other comprehensive income	–	–	(0.7)	0.7	–	(0.1)	(0.1)
Total comprehensive (expense) / income	–	–	(0.7)	184.4	183.7	(0.1)	183.6
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	286.9	(1.8)	108.3	1,038.9	1,432.3	0.6	1,432.9

The Notes on pages 131 to 172 form part of these Group accounts.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 130

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS

For the year ended 31 March 2024

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 2024 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 (see the going concern statement

on page 39) 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.

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. 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.

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 further details

on the application of these estimates can be found in Note 10. While not significant estimates, the

Group also focuses on estimates made in relation to inventories (Note 18), 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 12 ‘International Tax Reform – Pillar Two Model Rules’

The amendments clarify that IAS 12 applies to income taxes arising from tax law enacted or

substantively enacted to implement the Pillar Two model rules published by the Organisation for

Economic Co-operation and Development (OECD). The amendments introduce a temporary exception

to the recognition and disclosure of information about deferred tax assets and liabilities related to any

resulting top-up income taxes, which the Group has applied. Note 11 contains more details on the

implementation of these amendments.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 131

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

1 Basis of preparation continued

Amendments to IAS 12 ‘Deferred Tax related to Assets and Liabilities arising from

a Single Transaction’

The amendments narrow the scope of the initial recognition exemption to exclude transactions

that give rise to equal and offsetting temporary differences, such as leases. The Group previously

recognised the deferred tax asset or liability on leases on a net basis. Following the amendments, the

Group has recognised a separate deferred tax asset in relation to its lease liabilities and a deferred tax

liability in relation to its right-of-use assets from the beginning of the comparative period presented

and disclosed the amounts in Note 11. There was no impact on the balance sheet, as the balances

qualify for offset under paragraph 74 of IAS 12, or on opening retained earnings as at 1 April 2022

as a result of the change.

Other

International Financial Reporting Standard (IFRS) 17 ‘Insurance Contracts’, Amendments to IAS 1 and

IFRS Practice Statement 2 ‘Disclosure of Accounting Policies’ and Amendments to IAS 8 ‘Definition of

Accounting Estimates’ 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 any standards or interpretations issued but not yet applicable will

have a significant impact on the accounts.

The impact of any standards or interpretations issued after the year end has not been assessed yet.

2 Segmental reporting

The Group’s operating segments comprise three regions: EMEA, Americas and Asia Pacific. Their

principal activities are described on pages 29 to 31. 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 operating costs.

Year ended 31 March 2024

	EMEA	Americas	Asia Pacific	Group
	£m	£m	£m	£m
Revenue from external customers	1,794.8	933.7	213.9	2,942.4
Segmental operating profit	255.7	101.4	3.8	360.9
Central costs				(49.1)
Adjusted operating profit				311.8
Amortisation of acquired intangibles				(26.6)
Acquisition-related items (Note 3)				(5.1)
Operating profit				280.1
Net finance costs				(31.9)
Share of profit of joint venture				0.6
Profit before tax				248.8
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

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 132

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

2 Segmental reporting

continued

Year ended 31 March 2023

	EMEA	Americas	Asia Pacific	Group
	£m	£m	£m	£m
Revenue from external customers	1,768.5	945.5	268.3	2,982.3
Segmental operating profit	275.8	148.5	38.4	462.7
Central costs				(60.5)
Adjusted operating profit				402.2
Amortisation and impairment of acquired
intangibles				(16.6)
Acquisition-related items (Note 3)				(2.6)
Operating profit				383.0
Net finance costs				(12.2)
Share of profit of joint venture				0.7
Profit before tax				371.5
Segmental capital expenditure	34.9	7.1	0.4	42.4
Central costs				–
Capital expenditure				42.4
Segmental depreciation and amortisation	34.7	11.9	3.2	49.8
Central costs				1.5
Amortisation of acquired intangibles				13.3
Depreciation and amortisation
(including of right-of-use assets)				64.6

Disaggregation of revenue

In the table below, revenue is disaggregated by sales channels, by own-brand products or other

product and service solutions, and also by service solutions or other. The Group’s largest own brand

is RS PRO. £2,850.7 million of revenue is recognised at a point in time (2022/23: £2,901.2 million) and

£91.7 million over time (2022/23: £81.1 million).

Sales channel

Year ended 31 March 2024

	EMEA	Americas	Asia Pacific	Group
	£m	£m	£m	£m
Web	880.8	258.9	88.5	1,228.2
eProcurement and other digital	441.5	77.3	34.6	553.4
Digital	1,322.3	336.2	123.1	1,781.6
Offline	472.5	597.5	90.8	1,160.8
Revenue	1,794.8	933.7	213.9	2,942.4
Year ended 31 March 2023
Web	893.8	304.3	121.2	1,319.3
eProcurement and other digital	417.3	100.5	39.6	557.4
Digital	1,311.1	404.8	160.8	1,876.7
Offline	457.4	540.7	107.5	1,105.6
Revenue	1,768.5	945.5	268.3	2,982.3

Own-brand / other products and service solutions

Year ended 31 March 2024

	EMEA	Americas	Asia Pacific	Group
	£m	£m	£m	£m
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
Year ended 31 March 2023
Own-brand product and service solutions	360.2	7.1	37.2	404.5
Other product and service solutions	1,408.3	938.4	231.1	2,577.8
Revenue	1,768.5	945.5	268.3	2,982.3

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 133

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

2 Segmental reporting

continued

Service solutions / other

During the first half of the year the Group reviewed what it classes as service solutions which has

resulted in certain revenue streams now being included and certain ones excluded, resulting in an

overall decrease to the service solutions revenue for the year ended 31 March 2023 of £48.6 million

and £29.9 million for the year ended 31 March 2022. The information below reflects the new

classification.

Year ended 31 March 2024

	EMEA	Americas	Asia Pacific	Group
	£m	£m	£m	£m
Service solutions	532.3	132.8	43.4	708.5
Other	1,262.5	800.9	170.5	2,233.9
Revenue	1,794.8	933.7	213.9	2,942.4
Year ended 31 March 2023 (restated)
Service solutions	506.1	132.9	46.4	685.4
Other	1,262.4	812.6	221.9	2,296.9
Revenue	1,768.5	945.5	268.3	2,982.3
Year ended 31 March 2022 (restated)
Service solutions	425.6	93.4	39.1	558.1
Other	1,153.9	625.3	216.4	1,995.6
Revenue	1,579.5	718.7	255.5	2,553.7

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
	2024	2023	2024	2023
	£m	£m	£m	£m
UK (country of domicile)	686.1	713.2	218.4	216.8
US	698.3	852.8	381.9	394.3
France	326.2	323.1	13.7	11.6
Mexico	193.2	46.5	238.8	231.5
Germany	189.0	208.2	30.2	61.3
Italy	126.9	128.6	3.4	4.3
Switzerland	44.3	12.9	288.0	–
Rest of world	678.4	697.0	63.3	20.0
Group	2,942.4	2,982.3	1,237.7 939.8

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 134

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

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 underlying 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 improve 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 part of underlying performance. The Directors also believe that

excluding recent acquisitions, amortisation and impairment of acquired intangibles and acquisition-related items aids comparison of the underlying 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! 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 2024

			Operating profit	Operating profit			Basic earnings	Diluted earnings
	Operating costs	Operating profit	margin	conversion	Profit before tax	Profit for the year	per share	per share
	£m	£m	%	%	£m	£m	p	p
Reported	(983.8)	280.1	9.5%	22.2%	248.8	183.7	38.8p	38.7p
Amortisation of acquired intangibles	26.6	26.6			26.6	19.8	4.2p	4.2p
Acquisition-related items	5.1	5.1			5.1	3.8	0.8p	0.8p
Adjusted	(952.1)	311.8	10.6%	24.7%	280.5	207.3	43.8p	43.7p
Year ended 31 March 2023
Reported	(969.2)	383.0	12.8%	28.3%	371.5	284.8	60.4p	60.2p
Amortisation and impairment of acquired intangibles	16.6	16.6			16.6	13.3	2.8p	2.8p
Acquisition-related items	2.6	2.6			2.6	2.1	0.4p	0.4p
Adjusted	(950.0)	402.2	13.5%	29.7%	390.7	300.2	63.6p	63.4p

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.

Acquisition-related items comprise transaction costs directly attributable to the acquisition of businesses, any deferred consideration payments relating to the retention of former owners 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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 135

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

3 Alternative Performance Measures (APMs)

continued

	2024	2023
	£m	£m
Transaction costs – acquisition-related costs incurred in year for acquisitions
completed in year (Note 29)	(4.7)	(2.6)
Adjustments to indemnification assets and related liabilities included in operating costs	(0.8)	–
Remeasurements of contingent consideration (Note 29)	0.4	–
Acquisition-related items (in operating costs)	(5.1)	(2.6)
Adjustments to uncertain tax provisions related to indemnification assets	1.3	–
Other associated income tax effects	–	0.5
Acquisition-related items after tax	(3.8)	(2.1)

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 underlying performance of the business.

The principal exchange rates applied in preparing the Group accounts and in calculating the following

like-for-like measures are:

	2024	2024	2023	2023
	Average	Closing	Average	Closing
US dollar	1.257	1.264	1.206	1.239
Euro	1.159	1.170	1.158	1.137

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 2023	2,982.3
Effect of exchange rates	(57.4)
Effect of trading days	(24.1)
Revenue for 2023 at 2024 rates and trading days	2,900.8

		Less:
		acquisitions	2024		2023 at
	2024	owned	base		2024 rates and	Like-for-like
	Group	< 1 year	business	2023	trading days	change
	£m	£m	£m	£m	£m	%
EMEA	1,794.8	134.6	1,660.2	1,768.5	1,743.1	(5)%
Americas	933.7	145.9	787.8	945.5	909.3	(13)%
Asia Pacific	213.9	1.8	212.1	268.3	248.4	(15)%
Revenue	2,942.4	282.3	2,660.1	2,982.3	2,900.8	(8)%

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 revenue and gross profit converted at the

current year’s average exchange rates.

		Less:
	2024	acquisitions	2024 base		2023 at	Like-for-like
	Group	owned < 1 year	business	2023	2024 rates	change
	£m	£m	£m	£m	£m	pts
Revenue	2,942.4	282.3	2,660.1	2,982.3	2,924.9
Gross profit	1,263.9	88.8	1,175.1	1,352.2	1,326.0
Gross margin	43.0%	31.5%	44.2%	45.3%	45.3%	(1.1) pts

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 136

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

3 Alternative Performance Measures (APMs)

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.

		Less:
		acquisitions	2024
	2024	owned <	base		2023 at	Like-for-like
	Group	1 year	business	2023	2024 rates	change
	£m	£m	£m	£m	£m	%
Segmental operating profit
EMEA	255.7	5.9	249.8	275.8	274.1	(9)%
Americas	101.4	11.7	89.7	148.5	142.3	(37)%
Asia Pacific	3.8	–	3.8	38.4	33.7	(89)%
Segmental operating profit	360.9	17.6	343.3	462.7	450.1	(24)%
Central costs	(49.1)	–	(49.1)	(60.5)	(60.1)	(18)%
Adjusted operating profit	311.8	17.6	294.2	402.2	390.0	(25)%
Adjusted profit before tax	280.5	15.4	265.1	390.7	378.5	(30)%
Adjusted earnings per share	43.8p	2.8p	41.0p	63.6p	61.7p	(34)%
Adjusted diluted earnings per
share	43.7p	2.8p	40.9p	63.4p

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.

	2024	2023
	£m	£m
Net cash from operating activities	196.6	306.5
Purchase of intangible assets	(35.7)	(27.5)
Purchase of property, plant and equipment	(15.9)	(18.6)
Proceeds on sale of property, plant and equipment	–	0.1
Add back: impact of substantial reorganisation cash flows	0.7	0.5
Add back: impact of acquisition-related items cash flows	5.5	2.6
Adjusted free cash flow	151.2	263.6
Add back: income tax paid	73.3	93.9
Add back: net interest paid	31.0	12.6
Adjusted operating cash flow	255.5	370.1
Adjusted operating profit	311.8	402.2
Adjusted operating cash flow conversion	81.9%	92.0%

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 is defined and reconciled

in Note 22. 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.

	2024	2023
	£m	£m
Operating profit	280.1	383.0
Add back: depreciation and amortisation	83.7	64.6
EBITDA	363.8	447.6
Add back: impairment of acquired intangibles	–	3.3
Add back: acquisition-related items	5.1	2.6
Adjusted EBITDA	368.9	453.5
Net debt	418.2	113.0
Net debt to adjusted EBITDA	1.1x	0.2x

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 137

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

3 Alternative Performance Measures (APMs)

continued

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.

	2024	2023
	£m	£m
Adjusted EBITDA	368.9	453.5
Less: depreciation	(35.5)	(36.2)
EBITA	333.4	417.3
Finance costs	36.7	14.2
Less: finance income	(4.8)	(2.0)
Interest (per debt covenants)	31.9	12.2
EBITA to interest	10.5x	34.2x

Return on capital employed (ROCE)

ROCE is adjusted operating profit expressed as a percentage of monthly average net assets excluding

net debt and retirement benefit obligations and is an underpin for the LTIP and J2G LTIP Award and

a financial KPI.

	2024	2023
	£m	£m
Average net assets	1,389.3	1,258.0
Add back: average net debt	371.6	25.6
Add back: average retirement benefit net (assets) / obligations	31.2	24.1
Average capital employed	1,792.1	1,307.7
Adjusted operating profit	311.8	402.2
ROCE	17.4%	30.8%

Working capital as a percentage of revenue

Working capital is inventories, current trade and other receivables and current trade and other payables.

	2024	2023
	£m	£m
Inventories	656.0	616.3
Current trade and other receivables	701.4	692.0
Current trade and other payables	(602.7)	(658.9)
Working capital	754.7	649.4
Revenue	2,942.4	2,982.3
Working capital as a percentage of revenue	25.6%	21.8%

Inventory turn

Inventory turn is cost of sales divided by inventories.

	2024	2023
	£m	£m
Cost of sales	1,678.5	1,630.1
Inventories	656.0	616.3
Inventory turn	2.6	2.6

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.

	2024	2023
	£m	£m
Depreciation and amortisation	83.7	64.6
Less: amortisation of acquired intangibles	(26.6)	(13.3)
Less: depreciation of right-of-use assets	(18.6)	(18.3)
Adjusted depreciation and amortisation	38.5	33.0
Capital expenditure	51.2	42.4
Ratio of capital expenditure to depreciation	1.3 times	1.3 times

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 138

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

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 over time 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 2024 were £16.7 million

(2022/23: £18.1 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.

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.

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 2024, the Group had £2.1 million (2022/23: £4.2 million) of supplier rebates

recognised within trade and other receivables.

	2024	2023
	£m	£m
Inventory scrapped	13.2	12.6
Movement in inventory provisions	21.9	20.4
Write-down of inventories to net realisable value	35.1	33.0
Loss on foreign exchange related to sales and purchases	6.8	1.5
Net gains on forward foreign exchange contracts classified as fair value through profit or loss	(2.6)	–
Direct pass-through costs related to the provision of outsourced services	42.8	39.6
Inventories recognised as an expense	1,596.4	1,556.0
Cost of sales	1,678.5	1,630.1

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 139

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

6 Operating costs

	2024	2023
	£m	£m
Amortisation of intangible assets (Note 14)	48.2	28.4
Depreciation of property, plant and equipment (Note 15)	16.9	17.9
Depreciation of right-of-use assets (Note 16)	18.6	18.3
Depreciation and amortisation	83.7	64.6
Amortisation of government grants	(0.1)	(0.1)
Loss on other foreign exchange	0.1	4.2
Net (gains) / losses on forward foreign exchange contracts classified as fair value through profit or loss	(0.5)	5.2
Loss on disposal of intangible assets	0.2	4.4
Loss on disposal of property, plant and equipment	1.3	–
Loss on disposal of right-of-use assets	0.1	–
Increase in impairment allowance for financial assets (Note 23)	3.4	5.5
Employee costs (Note 8)	469.7	479.0
Less: capitalised employee costs	(15.4)	(13.0)
Less: pass-through employee costs included in cost of sales	(39.8)	(35.8)
Other operating costs	481.1	455.2
Operating costs	983.8	969.2

Fees paid to the Auditors were:

	2024	2023
	£m	£m
Fees payable to the Company’s Auditors for the audit of the Company and Group accounts	1.1	0.9
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	3.2	3.0

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.

	2024	2023
	£m	£m
Finance income
Interest income on financial assets measured at amortised cost	4.8	1.8
Interest income on interest rate swaps	–	0.2
Finance income	4.8	2.0
Finance costs
Interest expense on financial liabilities measured at amortised cost	(28.1)	(9.5)
Interest expense on lease liabilities	(2.9)	(1.1)
Interest expense on financial liabilities not at fair value through profit or loss	(31.0)	(10.6)
Interest expense on interest rate swaps	–	(0.7)
Interest expense on tax payable	(1.2)	–
Interest on uncertain income tax positions	(0.1)	(0.2)
Invoice finance charges	(4.4)	(2.7)
Finance costs	(36.7)	(14.2)

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 140

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

8 Employees

	Average number of employees 2024	2023
EMEA	5,872	5,417
Americas	2,256	1,670
Asia Pacific	767	668
Central costs	69	63
Group	8,964	7,818

Employment costs

	2024	2023
	£m	£m
Wages and salaries	373.8	385.9
Social security costs	52.7	50.7
Share-based payments – equity-settled (Note 9)	7.8	14.2
Share-based payments – cash-settled (Note 9)	0.4	1.3
Defined contribution retirement benefit costs (Note 10)	21.0	19.5
Defined benefit retirement benefit costs (Note 10)	4.1	3.5
	459.8	475.1
Termination benefits	9.9	3.9
Total	469.7	479.0

Information on the Directors’ remuneration is given in the Directors’ Remuneration Report on pages

99 to 115.

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.

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 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 depending on the

outcome of normally the performance conditions. All awards have £nil exercise price and normally

receive accrued dividends on settlement.

Those awards made under the 2019 LTIP in 2020/21 (vested in June 2023) and 2021/22 are 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 normally 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.

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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 141

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

9 Share-based payments

continued

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.

		2024			2023
	December	November	June	May	December	July
Grant date	2023	2023	2023	2023	2022	2022
Market performance
conditions
Awards granted	31,818	110,006	6,109	931,186	77,792	777,686
Fair value at grant date	243p	184p	251p	295p	471p	626p
Assumptions used:
Share price	816p	714p	800p	798p	921p	979p
Expected volatility	29.5%	29.6%	30.0%	30.2%	32.8%	32.4%
Expected life	2 years	2 years	2 years	3 years	2 years	3 years
	5 months	6 months	11 months		7 months
Risk-free interest rate	3.97%	4.29%	4.95%	4.50%	3.36%	1.75%
Other conditions
Awards granted	31,818	178,634	53,670	1,413,539	243,911	4,009,281
Fair value at grant date	816p	714p	800p	798p	921p	979p

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 2024 were:

	Awards
	granted	Fair value
June 2021 – Other conditions	4,393	727p
June 2021 – Market performance conditions	4,393	–p
July 2022 – Other conditions	12,000	245p
December 2022 – Other conditions	1,300	230p
June 2023 – Other conditions	462	200p
December 2023 – Other conditions	2,419	–p
December 2023 – Market performance conditions	2,419	–p

The movements in the LTIP awards (equity and cash settled) were:

	2024	2023
	Number of	Number of
	awards	awards
Outstanding at 1 April	6,302,743	3,940,677
Forfeited during the year	(1,019,886)	(1,293,879)
Expired during the year	(585,383)	(789,203)
Exercised during the year	(632,463)	(676,822)
Granted during the year	2,762,080	5,121,970
Outstanding at 31 March	6,827,091	6,302,743

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 2024 are expected to be awarded in June 2024. The fair value of the shares awarded during

the year was 803p (2022/23: 1,005p) per share award which was the share price at the date of award.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 142

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

9 Share-based payments

continued

The movements in the DSBP awards were:

	2024	2023
	Number of	Number of
	awards	awards
Outstanding at 1 April	224,185	259,570
Forfeited during the year	–	(17,766)
Exercised during the year	(108,658)	(189,422)
Granted during the year	133,061	171,803
Outstanding at 31 March	248,588	224,185

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.

	2024	2023
	3 year	3 year
Grant date	November 2023	December 2022
Options granted	1,814,474	1,300,316
Fair value at grant date	265p	325p
Assumptions used:
Share price	776p	944p
Exercise price	562p	715p
Expected volatility	28.7%	32.6%
Expected option life	3 years	3 years
Expected dividend yield	2.50%	1.71%
Risk-free interest rate	4.14%	3.16%

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.

The fair values of cash-settled SAYE options at 31 March 2024 are shown below and were calculated

using a Black-Scholes model, using a share price of 727p, expected dividend yield of 2.7% and

additional assumptions below.

					Expected	Risk-free
	Options		Exercise	Expected	remaining	interest
	granted	Fair value	price	volatility	option life	rate
5 year September 2019	99,256	288p	439p	26.2%	0.5 years	4.50%
5 year September 2020	19,798	189p	573p	27.9%	1.5 years	4.17%
3 year September 2021	222,284	27p	824p	26.2%	0.5 years	4.50%
5 year September 2021	11,939	106p	824p	30.1%	2.5 years	3.94%
3 year December 2022	518,735	216p	715p	27.9%	1.8 years	4.17%
3 year November 2023	707,264	324p	562p	28.8%	2.8 years	3.94%

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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 143

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

9 Share-based payments

continued

The movements in and weighted average exercise price of the SAYE options (equity and cash

settled) were:

	2024		2023
	Weighted		Weighted
	average		average
	exercise	Number of	exercise	Number of
	price	options	price	options
Outstanding at 1 April	662p	4,056,336	564p	3,850,612
Forfeited during the year	733p	(299,010)	594p	(154,098)
Expired during the year	708p	(847,998)	729p	(147,083)
Exercised during the year	539p	(904,196)	442p	(1,312,146)
Granted during the year	562p	2,521,738	715p	1,819,051
Outstanding at 31 March	616p	4,526,870	662p	4,056,336
Exercisable at 31 March	573p	125,525	438p	171,214

SAYE options outstanding at the year end were:

	2024	2023
Option prices:
£2.00 – £2.99	–	1,310
£4.00 – £4.99	280,813	488,139
£5.00 – £5.99	2,761,202	1,090,103
£7.00 – £7.99	1,048,950	1,778,421
£8.00 – £8.99	435,905	698,363
	4,526,870	4,056,336
Weighted average remaining contractual life (in years)	2.62	1.91
Weighted average share price during period of exercise	753p	954p

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.

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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 144

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

10 Retirement benefit obligations

continued

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: www.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 2024 has been restricted to

£nil (2022/23: £nil) and an additional liability of £16.1 million (2022/23: £26.2 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 2024, in the year ending 31 March 2025 the Group

expects to pay £13.1 million of contributions to the UK scheme, including £11.1 million of deficit

contribution payments, and £0.8 million to the other defined benefit schemes.

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.

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. 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 for the year ended 31 March 2024 145

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

10 Retirement benefit obligations

continued

Assumptions

Financial assumptions

The principal assumptions used to determine the defined benefit obligations were:

	2024		2023
	UK	Other	UK	Other
Discount rate	4.90%	2.31%	4.90%	3.66%
Rate of increase in pensionable salaries	Nil	1.57%	Nil	1.04%
Rate of RPI inflation	3.20%	1.58%	3.30%	2.34%
Rate of CPI inflation	2.80%	1.58%	2.80%	2.34%
Rate of pension increases
RPI inflation capped at 5.0% p.a.	2.95%	n/a	3.05%	n/a
RPI inflation capped at 2.5% p.a.	1.95%	n/a	2.05%	n/a

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:

	2024	2023
	Years	Years
Member aged 65 (current life expectancy) – male	22.0	21.9
Member aged 65 (current life expectancy) – female	23.4	23.3
Member aged 45 (life expectancy at aged 65) – male	23.4	23.3
Member aged 45 (life expectancy at aged 65) – female	25.1	25.8

At 31 March 2024, the weighted average duration of the UK defined benefit obligation was 14 years

(2022/23: 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 the assumption on the UK scheme while holding all

other assumptions constant; 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 2024:

	Increase in	Decrease in
	assumption	assumption
	£m	£m
Effect on obligation of a 0.5 pts change to the assumed discount rate	(24.7)	27.3
Effect on obligation of a 0.25 pts change in the assumed inflation rate	11.7	(11.3)
Effect on obligation of a change of one year in assumed life expectancy	10.9	(10.9)

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 146

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

10 Retirement benefit obligations

continued

Income statement

The net charge / (credit) recognised in operating profit for retirement benefit obligations was:

		2024			2023
	UK	Other	Total	UK	Other	Total
	£m	£m	£m	£m	£m	£m
Current service cost	1.2	0.4	1.6	2.0	0.3	2.3
Past service cost	–	(0.1)	(0.1)	–	–	–
Interest expense on obligation	18.7	0.9	19.6	15.4	0.3	15.7
Interest income on scheme assets	(20.7)	(0.6)	(21.3)	(16.3)	(0.1)	(16.4)
Interest expense on asset ceiling / onerous liability	3.0	0.1	3.1	0.7	–	0.7
Administrative expenses	1.2	–	1.2	1.2	–	1.2
Total charge for defined benefit schemes	3.4	0.7	4.1	3.0	0.5	3.5
Total charge for defined contribution schemes and personal pensions	10.6	10.4	21.0	8.9	10.6	19.5

Balance sheet

The amounts included in the balance sheet arising from the Group’s assets / (obligations) in respect of its defined benefit schemes was:

		2024			2023
	UK	Other	Total	UK	Other	Total
	£m	£m	£m	£m	£m	£m
Fair value of scheme assets	421.2	30.8	452.0	425.4	6.6	432.0
Present value of defined benefit obligations	(385.1)	(36.7)	(421.8)	(390.5)	(16.8)	(407.3)
Effect of asset ceiling / onerous liability	(52.2)	(3.7)	(55.9)	(61.1)	–	(61.1)
Retirement benefit net obligations	(16.1)	(9.6)	(25.7)	(26.2)	(10.2)	(36.4)
Amount recognised on the balance sheet – liability	(16.1)	(11.1)	(27.2)	(26.2)	(11.0)	(37.2)
Amount recognised on the balance sheet – asset	–	1.5	1.5	–	0.8	0.8

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 147

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

10 Retirement benefit obligations

continued

The other defined benefit schemes were:

		2024				2023
		Present value of	Effect of asset	Retirement		Present value of	Retirement
	Fair value of	defined benefit	ceiling / onerous	benefit	Fair value of	defined benefit	benefit
	scheme assets	obligations	liability	obligations	scheme assets	obligations	obligations
	£m	£m	£m	£m	£m	£m	£m
Germany’s defined benefit pension scheme	–	(7.2)	–	(7.2)	–	(7.1)	(7.1)
Republic of Ireland’s defined benefit pension scheme	7.2	(5.7)	–	1.5	6.6	(5.8)	0.8
France’s defined benefit retirement indemnity scheme	–	(3.1)	–	(3.1)	–	(3.0)	(3.0)
Italy’s defined benefit retirement indemnity scheme	–	(0.8)	–	(0.8)	–	(0.9)	(0.9)
Switzerland’s contribution-based scheme	23.6	(19.9)	(3.7)	–	–	–	–
Other	30.8	(36.7)	(3.7)	(9.6)	6.6	(16.8)	(10.2)

Movements in the present value of the defined benefit obligations in the year were:

		2024			2023
	UK	Other	Total	UK	Other	Total
	£m	£m	£m	£m	£m	£m
At 1 April	390.5	16.8	407.3	560.8	20.0	580.8
Acquisitions	–	20.5	20.5	–	–	–
Current service cost	1.2	0.4	1.6	2.0	0.3	2.3
Past service cost	–	(0.1)	(0.1)	–	–	–
Interest expense	18.7	0.9	19.6	15.4	0.3	15.7
Effect of changes in demographic assumptions	(5.1)	–	(5.1)	(17.8)	0.3	(17.5)
Effect of changes in financial assumptions	(4.4)	1.6	(2.8)	(176.1)	(4.9)	(181.0)
Effect of experience adjustments	2.3	0.1	2.4	24.3	0.7	25.0
Benefits paid	(18.1)	(3.2)	(21.3)	(18.1)	(0.6)	(18.7)
Employee contributions	–	0.1	0.1	–	–	–
Exchange differences	–	(0.4)	(0.4)	–	0.7	0.7
At 31 March	385.1	36.7	421.8	390.5	16.8	407.3

Of the UK scheme’s present value of the defined benefit obligations, £33.8 million (2022/23: £33.8 million) relates to active members, £153.6 million (2022/23: £153.3 million) to vested deferred members and

£197.7 million (2022/23: £203.3 million) to retirees.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 148

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

10 Retirement benefit obligations

continued

Movements in the fair value of the schemes’ assets in the year were:

		2024			2023
	UK	Other	Total	UK	Other	Total
	£m	£m	£m	£m	£m	£m
At 1 April	425.4	6.6	432.0	585.7	7.6	593.3
Acquisitions	–	25.6	25.6	–	–	–
Interest income	20.7	0.6	21.3	16.3	0.1	16.4
Return on scheme assets (excluding interest income)	(18.6)	0.5	(18.1)	(170.7)	(1.5)	(172.2)
Contributions by company	13.0	0.9	13.9	13.4	0.7	14.1
Benefits paid	(18.1)	(3.2)	(21.3)	(18.1)	(0.6)	(18.7)
Administrative expenses	(1.2)	–	(1.2)	(1.2)	–	(1.2)
Emplo y ee contributions	–	0.1	0.1	–	–	–
Exchange differences	–	(0.3)	(0.3)	–	0.3	0.3
At 31 March	421.2	30.8	452.0	425.4	6.6	432.0

The fair values of the schemes’ assets were:

		2024			2023
	UK	Other	Total	UK	Other	Total
	£m	£m	£m	£m	£m	£m
QIAIF (liability driven investment and credit portfolio of quoted assets)	264.9	–	264.9	281.4	–	281.4
Quoted equities	–	10.1	10.1	–	2.4	2.4
Quoted debt instruments	68.3	12.8	81.1	63.1	4.1	67.2
Unquoted debt instruments	87.8	–	87.8	80.1	–	80.1
Property	–	7.7	7.7	–	–	–
Cash	0.2	0.2	0.4	0.8	0.1	0.9
Total market value of scheme assets	421.2	30.8	452.0	425.4	6.6	432.0

The defined benefit schemes do not invest in the Company and no property or other assets owned by the schemes are used by the Group.

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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 149

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

10 Retirement benefit obligations

continued

Movements in the effect of asset ceiling / onerous liability were:

		2024			2023
	UK	Other	Total	UK	Other	Total
	£m	£m	£m	£m	£m	£m
At 1 April	61.1	–	61.1	24.9	–	24.9
Acquisitions	–	5.1	5.1	–	–	–
Interest expense	3.0	0.1	3.1	0.7	–	0.7
Change in asset ceiling / onerous liability (excluding interest expense)	(11.9)	(1.5)	(13.4)	35.5	–	35.5
At 31 March	52.2	3.7	55.9	61.1	–	61.1

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.

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 2024, the total value of

these tax provisions was £8.8 million (2022/23: £10.6 million). It is possible that the amounts paid will

be different from the amounts provided but this is not expected to be material.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 150

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

11 Taxation

continued

Tax expense / (income) recognised in the income statement

	2024	2023
	£m	£m
Current tax
Current tax on profits for the year	67.8	89.5
Adjustments for prior years	6.3	(0.6)
Total current tax	74.1	88.9
Deferred tax
Origination and reversal of temporary differences	(2.6)	(2.4)
Changes in tax rates and laws	–	(0.5)
Adjustments for prior years	(6.4)	0.7
Total deferred tax	(9.0)	(2.2)
Income tax expense	65.1	86.7

The income tax expense for the year can be reconciled to the profit per the income statement

as follows:

	2024	2023
	£m	£m
Profit before tax	248.8	371.5
Expected tax charge at UK corporation tax rate of 25% (2023: 19%)	62.2	70.6
Recurring items
Differences in overseas corporation tax rates	0.2	12.3
Impact of tax losses	(0.1)	(0.2)
Items not taxable for tax purposes	(1.2)	(1.2)
Items not deductible for tax purposes	4.7	4.1
Other local taxes suffered overseas	1.1	1.0
Non-recurring items
Changes in tax rates and laws	–	(0.5)
Movement in uncertain tax provisions in current year	0.9	1.7
Movement in uncertain tax provisions for prior years	(2.6)	(1.2)
Prior year adjustments	(0.1)	0.1
	65.1	86.7

The Group’s effective tax rate increased in the year as the UK government enacted a change in the UK

corporation tax rate in May 2021 from 19% to 25% which was effective from 1 April 2023.

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 applied the exception under Amendments to IAS 12 ‘International

Tax Reform – Pillar Two Model Rules’ to not recognise and disclose information about deferred tax

assets and liabilities related to any resulting top-up income taxes. The Group is continuing to assess

the full impact of this and it is not expected to have a material impact on the reported results or

financial position of the Group.

Tax expense / (income) recognised directly in other comprehensive income

	2024	2023
	£m	£m
Relating to remeasurement of retirement benefit obligations	0.1	(7.9)
Relating to movement in cash flow hedges	–	0.7
	0.1	(7.2)

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 151

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

11 Taxation

continued

Movement in deferred tax assets and liabilities

	Intangible assets
	(excluding goodwill),
	right-of-use assets		Retirement
	and property, plant		benefit	Employee		Lease		Net tax
	and equipment	Goodwill	obligations	benefits	Tax losses	liabilities	Other	(liabilities) / assets
	restated					restated
	£m	£m	£m	£m	£m	£m	£m	£m
At 1 April 2022	(24.9)	(48.2)	2.2	9.9	3.0	–	2.5	(55.5)
Effect of Amendments to IAS 12 (Note 1)	(11.3)	–	–	–	–	11.3	–	–
At 1 April 2022 (restated)	(36.2)	(48.2)	2.2	9.9	3.0	11.3	2.5	(55.5)
Acquisitions	(35.1)	–	–	–	–	2.9	1.6	(30.6)
Credit / (charge) to income statement	1.8	(0.1)	0.6	2.5	(0.2)	(1.4)	(1.0)	2.2
Recognised directly in equity	–	–	5.8	(0.5)	–	–	–	5.3
Translation differences	(2.4)	(2.9)	0.1	0.1	–	0.3	0.2	(4.6)
At 31 March 2023	(71.9)	(51.2)	8.7	12.0	2.8	13.1	3.3	(83.2)
Acquisitions (Note 29)	(25.7)	–	–	–	2.4	6.8	2.4	(14.1)
Credit / (charge) to income statement	8.9	0.3	0.4	(3.7)	1.6	(1.0)	2.5	9.0
Recognised directly in equity	–	–	(2.9)	(1.7)	–	–	–	(4.6)
Translation differences	(1.7)	1.0	(0.1)	(0.1)	–	–	–	(0.9)
At 31 March 2024	(90.4)	(49.9)	6.1	6.5	6.8	18.9	8.2	(93.8)

Analysed in the balance sheet as:

	2024	2023
	£m	£m
Deferred tax assets	9.5	6.9
Deferred tax liabilities	(103.3)	(90.1)
	(93.8)	(83.2)

1 Restated as described in Note 1

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 £1.3 million (2022/23: £0.7 million) which carries no expiry date.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 152

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

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.

	2024	2023
	Number	Number
Weighted average number of shares	473,300,106	471,717,928
Dilutive effect of share-based payments	781,177	1,194,205
Diluted weighted average number of shares	474,081,283	472,912,133
Basic earnings per share	38.8p	60.4p
Diluted earnings per share	38.7p	60.2p

13 Dividends

	2024	2023
	£m	£m
Final dividend for the year ended 31 March 2023 – 13.7p (2022: 11.6p)	64.8	54.6
Interim dividend for the year ended 31 March 2024 – 8.3p (2023: 7.2p)	39.3	34.0
	104.1	88.6

The trustees of the EBT have waived their right to receive dividends and this rounds to £nil

(2022/23: £nil).

A proposed final dividend for the year ended 31 March 2024 of 13.7p is subject to approval by

shareholders at the Annual General Meeting on 11 July 2024 and the estimated amount to be paid

of £64.9 million has not been included as a liability in these accounts.

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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 153

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

14 Intangible assets

continued

					Customer
					contracts,
					relationships and
			Development		distribution	Acquired
	Goodwill	Software	expenditure	Brands	agreements	research	Total
	£m	£m	£m	£m	£m	£m	£m
Cost
At 1 April 2022	330.5	326.2	1.8	4.0	86.3	1.1	749.9
Acquisitions	111.8	–	–	–	107.8	–	219.6
Additions – internally generated	–	10.8	–	–	–	–	10.8
Additions – other	–	14.6	–	–	–	–	14.6
Disposals	–	(10.2)	–	(4.0)	–	–	(14.2)
Reclassifications	–	(0.6)	–	–	–	–	(0.6)
Translation differences	21.0	2.7	–	–	5.7	–	29.4
At 31 March 2023	463.3	343.5	1.8	–	199.8	1.1	1,009.5
Acquisitions (Note 29)	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
Amortisation
At 1 April 2022	–	250.7	0.7	0.5	24.2	0.5	276.6
Charge for the year	–	14.5	0.7	0.2	12.7	0.3	28.4
Impairment losses	–	3.8	–	3.3	–	–	7.1
Disposals	–	(5.8)	–	(4.0)	–	–	(9.8)
Translation differences	–	2.1	–	–	0.3	–	2.4
At 31 March 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
Net book value
At 31 March 2024	646.3	98.3	–	20.0	218.0	–	982.6
At 31 March 2023	463.3	78.2	0.4	–	162.6	0.3	704.8

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 154

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

14 Intangible assets

continued

As at 31 March 2024, the cost and accumulated amortisation of internally generated intangible assets

included in software were £78.8 million and £49.5 million (2022/23: £68.5 million and £41.9 million)

respectively. All development expenditure was internally generated.

At 31 March 2024, the only material individual software asset was the new product management

system with a net book value of £16.0 million which will have a useful life of 8 years (2022/23: none).

Material individual customer contracts, relationships and distribution agreements are from the

acquisitions of IESA, Synovos, Risoul and Distrelec with net book values of £15.4 million, £14.4 million,

£105.0 million and £69.7 million respectively (2022/23: £19.8 million, £18.6 million, £108.0 million and

£nil) and remaining useful lives of 1 to 4 years, 4 years, 1 to 14 years and 15 years respectively.

Goodwill is allocated at acquisition to the cash generating units (CGUs) that are expected to benefit

from the synergies arising as a result of the acquisition, with £412.1 million (2022/23: £410.2 million)

relating to the Americas CGU, £231.1 million (2022/23: £49.7 million) relating to the EMEA CGU and

£3.1 million (2022/23: £3.4 million) relating to the Asia Pacific CGU.

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 CGU 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 CGU to which the asset belongs.

In 2022/23, as a result of the rebranding of Needlers to RS Safety Solutions effective from

1 November 2022, the net book value of the Needlers brand acquired in December 2020 was

impaired by £3.3 million and then written off. This impairment was included in operating costs

(and was the impairment in amortisation and impairment of acquired intangibles).

The software impairments are included in operating costs in EMEA and relate to assets which will stop

being used in the future.

For the goodwill impairment reviews, the recoverable amount of the CGUs is 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 CGU and

discounted at the Group’s externally sourced pre-tax weighted average cost of capital (including lease

liabilities) adjusted for the estimated tax cash flows and risk applicable for the CGU 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. £15 million) 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 CGU, the long-term growth rate is 1.9% (2022/23: 1.8%) 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 11.9% (2022/23: 11.6%).

For the EMEA CGU, the long-term growth rate is 1.5% (2022/23: 1.7%) 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 11.9% (2022/23: 11.6%).

For the Asia Pacific CGU, the long-term growth rate is 2.0% (2022/23: 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 17.5% (2022/23: 16.3%).

There is significant headroom between the carrying amount and the value in use of the CGUs (over

70%) 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.

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

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 includes consideration of the

Group’s climate scenario analysis of physical and transition risk impacts conducted for the TCFD.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 155

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

15 Property, plant and equipment

continued

	Land and	Plant and	Computer
	buildings	machinery	equipment	Total
	£m	£m	£m	£m
Cost
At 1 April 2022	155.6	226.1	62.4	444.1
Acquisitions	1.5	1.0	0.4	2.9
Additions	1.8	10.9	4.3	17.0
Disposals	–	(0.7)	(2.3)	(3.0)
Reclassifications	–	(0.1)	0.7	0.6
Translation differences	4.8	4.6	1.5	10.9
At 31 March 2023	163.7	241.8	67.0	472.5
Acquisitions (Note 29)	–	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
Depreciation
At 1 April 2022	56.0	152.9	57.9	266.8
Charge for the year	3.6	10.3	4.0	17.9
Disposals	–	(0.6)	(2.3)	(2.9)
Translation differences	1.2	1.9	1.3	4.4
At 31 March 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
Net book value
At 31 March 2024	99.9	74.2	6.8	180.9
At 31 March 2023	102.9	77.3	6.1	186.3

Included above are £5.9 million of property, plant and equipment under construction at 31 March 2024

(2022/23: £2.2 million).

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 for the year ended 31 March 2024 156

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

16 Leases continued

The amounts recognised relating to leases were:

	2024	2023
	£m	£m
Right-of-use assets
Buildings	64.3	39.5
Plant and machinery	0.1	0.2
Computer equipment	–	1.3
Vehicles	8.4	5.9
Right-of-use assets	72.8	46.9
Lease liabilities
Current	16.0	14.6
Non-current	57.9	34.3
Lease liabilities	73.9	48.9
Depreciation charge for right-of-use assets
Buildings	13.3	10.1
Plant and machinery	0.1	0.3
Computer equipment	1.3	5.2
Vehicles	3.9	2.7
Depreciation charge for right-of-use assets	18.6	18.3
Additions to right-of-use assets
Right-of-use assets acquired with businesses	29.8	10.0
Other additions to right-of-use assets	8.4	6.3
Additions to right-of-use assets	38.2	16.3

	2024	2023
	£m	£m
Total cash outflow / (inflow) for leases
Included in cash flows from operating activities:
Interest expense	2.9	1.1
Expense relating to short-term leases	1.1	1.0
Expense relating to leases of low-value assets, excluding short-term
leases of low-value assets	0.4	0.5
Expense relating to variable lease payments not included in measurement of lease liabilities	0.9	0.6
Income from sub-leasing right-of-use assets	(1.8)	–
Included in cash flows from financing activities:
Principal elements of lease payments	18.5	18.8
Total cash outflow for leases	22.0	22.0

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.

	2024	2023
	£m	£m
At 1 April	1.5	1.5
Group’s share of profit for the year	0.6	0.7
Group’s share of other comprehensive expense	(0.2)	(0.1)
Group’s share of total comprehensive income	0.4	0.6
Dividends	(0.6)	(0.6)
At 31 March	1.3	1.5

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 157

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

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. The Group bases its estimates on recent historical experience and knowledge of the

products on hand.

	2024	2023
	£m	£m
Raw materials and consumables	111.0	96.6
Finished goods and goods for resale	613.6	563.4
Gross inventories	724.6	660.0
Inventory provisions	(68.6)	(43.7)
Net inventories	656.0	616.3

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 £4.8 million

(2022/23: £3.0 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 £3.7 million (2022/23: £2.3 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 £4.3 million (2022/23: £2.0 million). An increase in the value recoverable leading to a

decrease in provision rates of 10% would decrease the inventory provisions by £5.7 million (2022/23:

£2.8 million). Therefore, currently the Group does not expect any reasonably likely changes, including

regulatory changes and the current global economic and geopolitical uncertainties, to have a material

impact on the net realisable value of inventories.

19 Trade and other receivables

	2024	2023
	£m	£m
Current
Gross trade receivables	624.0	621.0
Impairment allowance (Note 23)	(11.1)	(12.6)
Net trade receivables	612.9	608.4
Amounts owed by joint venture	1.5	2.8
Prepayments	43.9	36.1
Other taxation and social security	7.8	6.3
Contract assets	8.1	1.8
Other receivables	27.2	36.6
Current trade and other receivables	701.4	692.0
Non-current
Prepayments	0.1	0.3
Other receivables	8.3	6.2
Non-current other receivables	8.4	6.5

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.

Other receivables include £7.9 million (2022/23: £20.7 million) for amounts yet to be invoiced to

customers related to product sales where the Group acts as an agent (Note 4). Invoices cannot be

raised until other performance obligations are completed.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 158

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

20 Trade and other payables

	2024	2023
	£m	£m
Current
Trade payables	381.8	398.5
Other taxation and social security	40.7	42.4
Government grants	0.1	0.1
Cash-settled share-based payment liability	1.2	2.0
Accruals	133.0	180.6
Contract liabilities	4.4	7.6
Other payables (including estimated obligations for customer volume
discounts and refunds – Note 4)	41.5	27.7
Current trade and other payables	602.7	658.9
Non-current
Government grants	2.2	2.3
Cash-settled share-based payment liability	2.4	2.8
Other employee benefits	3.8	3.5
Accruals	0.1	0.7
Other payables	8.8	–
Non-current other payables	17.3	9.3

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. The substance of the contractual terms with the bank providing the financing does not

differ from the terms under the supplier contracts and there are no changes to the invoice terms and

therefore the amount owed to the bank of £14.1 million (2022/23: £13.5 million) is included in trade

payables. Related cash flows are included in cash generated from operations.

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 or net investment 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 and changes in their fair values are recognised in the income statement as they arise.

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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 159

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

21 Financial instruments continued

Other financial instruments

All other financial instruments are initially recognised at fair value plus transaction costs. Initial fair

value is generally the transaction price. Subsequent measurement is as follows:

– Borrowings are measured at amortised cost unless they are designated as being fair value hedged,

in which case they are remeasured for the fair value changes in respect of the hedged risk with these

changes recognised in the income statement. 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.

– All other financial liabilities, including current payables, are measured at amortised cost.

Derivatives

	2024		2023
	Current	Current	Current	Current
	assets	liabilities	assets	liabilities
	£m	£m	£m	£m
Forward foreign exchange contracts designated as cash flow hedges (principal amount £225.3 million
(2022/23: £112.4 million))	2.4	(1.1)	1.1	(1.4)
Forward foreign exchange contracts classified as fair value through profit or loss	0.2	–	0.7	(0.3)
Derivatives	2.6	(1.1)	1.8	(1.7)

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.

For all financial assets and liabilities, fair value approximates the carrying amounts in the balance sheet

except for the following:

	2024		2023
	Carrying	Fair	Carrying	Fair
	amounts	value	amounts	value
	£m	£m	£m	£m
Non-current private placement loan notes	(157.1)	(142.9)	(160.4)	(147.7)

The fair values are calculated using Level 2 inputs by discounting future cash flows to net present

values using prevailing interest rate curves and the Group’s credit margin.

Netting arrangements for financial instruments

The Group operates a number of cash pooling arrangements to provide the benefits of settling

interest on a net basis. The balances on these accounts do not meet the criteria for offsetting and so

are not presented on a net basis in the balance sheet. Where a legal right of offset exists, these are

shown in the table below along with any financial instruments which can be netted under master

netting arrangements.

	Gross and net	Financial
	amounts in	instruments
	balance sheet	not offset	Net amounts
	£m	£m	£m
At 31 March 2024
Cash and cash equivalents – cash and short-term deposits	258.7	(159.9)	98.8
Other derivative assets	2.6	(1.0)	1.6
Cash and cash equivalents – bank overdrafts	(162.7)	159.9	(2.8)
Other derivative liabilities	(1.1)	1.0	(0.1)
At 31 March 2023
Cash and cash equivalents – cash and short-term deposits	260.3	(135.2)	125.1
Other derivative assets	1.8	(1.0)	0.8
Cash and cash equivalents – bank overdrafts	(139.8)	135.2	(4.6)
Other derivative liabilities	(1.7)	1.0	(0.7)

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 160

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

22 Net debt

Net debt comprises cash and cash equivalents, borrowings and lease liabilities. Cash and cash

equivalents comprise cash in hand and in current accounts, overnight deposits and short-term

deposits net of overdrafts with qualifying financial institutions. Borrowings represent loans from

qualifying financial institutions.

	2024	2023
	£m	£m
Cash and short-term deposits	258.7	260.3
Bank overdrafts (unsecured)	(162.7)	(139.8)
Cash and cash equivalents	96.0	120.5

	2024	2023
	£m	£m
Non-current borrowings
Unsecured private placement loan notes repayable after more than five years	(78.4)	(80.0)
Unsecured private placement loan notes repayable from three to four years	–	(80.4)
Unsecured private placement loan notes repayable from two to three years	(78.7)	–
Unsecured sustainability-linked loan repayable from four to five years	(155.0)	(24.2)
Unsecured term loan repayable from two to three years	(128.2)	–
Non-current borrowings	(440.3)	(184.6)
Total borrowings	(440.3)	(184.6)
Cash and cash equivalents	96.0	120.5
Non-current lease liabilities	(57.9)	(34.3)
Current lease liabilities	(16.0)	(14.6)
Net debt	(418.2)	(113.0)

The amount borrowed under the sustainability-linked loan facility matured in April 2024 and was rolled

for another month. The expectation is that the amounts rolled will be gradually reduced until they will

be fully repaid during 2027/28.

Movements in net debt were:

			Total
			liabilities
			from		Cash and
		Lease	financing	Interest	cash
	Borrowings	liabilities	activities	rate swaps	equivalents	Net debt
	£m	£m	£m	£m	£m	£m
At 1 April 2022	(151.7)	(48.7)	(200.4)	(0.1)	158.4	(42.1)
Cash flows	(25.1)	18.8	(6.3)	–	(43.6)	(49.9)
Acquired with businesses	–	(9.8)	(9.8)	–	–	(9.8)
New leases	–	(6.3)	(6.3)	–	–	(6.3)
Lease modifications	–	(2.4)	(2.4)	–	–	(2.4)
Disposal of leases	–	0.3	0.3	–	–	0.3
(Loss) / gain in fair value in year	(0.1)	–	(0.1)	0.1	–	–
Translation differences	(7.7)	(0.8)	(8.5)	–	5.7	(2.8)
At 31 March 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)

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 161

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

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.

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 2020 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:

		2024			2023
		Gross			Gross
	Expected	carrying	Loss	Expected	carrying	Loss
	loss rate	amount	allowance	loss rate	amount	allowance
	%	£m	£m	%	£m	£m
0 – 30 days from date of invoice	1.0%	339.4	3.5	0.9%	366.0	3.4
31 – 60 days from date of invoice	1.2%	174.0	2.1	1.3%	162.4	2.1
61 – 90 days from date of invoice	1.8%	51.1	0.9	2.1%	42.6	0.9
91 – 120 days from date of invoice	3.0%	16.6	0.5	2.9%	17.5	0.5
Over 120 days from date of invoice	9.6%	42.9	4.1	17.5%	32.5	5.7
Total		624.0	11.1		621.0	12.6

The ageing of net trade receivables at the reporting date was:

	2024	2023
	£m	£m
Not past due	487.2	483.7
Past due 0 – 30 days	71.8	73.5
Past due 31 – 60 days	18.6	17.4
Past due 61 – 120 days	10.1	13.0
Past due over 120 days	25.2	20.8
Total	612.9	608.4

The movement in the impairment allowance for trade receivables was as follows:

	2024	2023
	£m	£m
At 1 April	(12.6)	(9.1)
Acquisitions	(0.8)	(2.1)
Trade receivables written off	5.6	4.5
Increase in impairment allowance recognised in profit or loss	(3.4)	(5.5)
Translation differences	0.1	(0.4)
At 31 March	(11.1)	(12.6)

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 162

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

23 Financial risk management continued

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 2023/24.

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 2024, the largest trade receivable balance was £13.5 million (2022/23: £12.0 million), of

which £11.0 million has been received since the year end. The maximum exposure with a single bank

for deposits was £12.6 million (2022/23: £26.0 million) and the largest mark to market exposure for

derivative financial instruments to a single bank was £0.6 million (2022/23: £0.7 million). The Group

also occasionally uses money market funds to invest surplus cash thereby diversifying credit risk and

at 31 March 2024 its exposure to these funds was £nil (2022/23: £nil).

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 one of the one-year term extensions to the

sustainability-linked loan facility was approved by the lenders and therefore, as at 31 March 2024,

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 sustainability-linked loan facility, with a lender option accordion of up to a further

£100 million, which has a maturity of October 2028 with an option for the Group to extend for a

further one year subject to individual lender approval. It is linked to the Group’s most material ESG

actions of the reduction of direct Scope 1 and 2 CO

e emissions, packaging intensity and percentage

of management that are women. Meeting these annual ESG actions means a margin benefit of up

to 2.5 basis points, while missing these ESG actions would mean paying a margin premium of up to

2.5 basis points. 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 repayable by 27 April 2026.

As at 31 March 2024, the Group had £245.0 million (2022/23: £375.8 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 for the year ended 31 March 2024 163

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

23 Financial risk management continued

The contractual maturities of financial liabilities, including contractual future interest payments were:

	Carrying	Contractual	Within	1 – 2	2 – 3	3 – 4	After 4
	amounts	cash flows	1 year	years	years	years	years
	£m	£m	£m	£m	£m	£m	£m
Derivative financial liabilities
Inflows for forward foreign exchange contracts	150.6	150.5	150.5	–	–	–	–
Outflows for forward foreign exchange contracts	(151.7)	(151.7)	(151.7)	–	–	–	–
Forward foreign exchange contracts	(1.1)	(1.2)	(1.2)	–	–	–	–
Non-derivative financial liabilities
Sustainability-linked loan	(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)

	Carrying	Contractual	Within	1 – 2	2 – 3	3 – 4	After 4
	amounts	cash flows	1 year	years	years	years	years
	£m	£m	£m	£m	£m	£m	£m
Derivative financial liabilities
Inflows for forward foreign exchange contracts	86.1	87.0	87.0	–	–	–	–
Outflows for forward foreign exchange contracts	(87.8)	(87.8)	(87.8)	–	–	–	–
Forward foreign exchange contracts	(1.7)	(0.8)	(0.8)	–	–	–	–
Non-derivative financial liabilities
Sustainability-linked loan	(24.2)	(24.3)	(24.3)	–	–	–	–
Private placement loan notes	(160.4)	(191.3)	(5.0)	(5.0)	(5.0)	(85.4)	(90.9)
Lease liabilities	(48.9)	(57.4)	(16.1)	(11.7)	(8.7)	(6.6)	(14.3)
Bank overdrafts	(139.8)	(139.8)	(139.8)	–	–	–	–
Trade payables, other payables and accruals	(533.0)	(533.0)	(532.3)	(0.7)	–	–	–
At 31 March 2023	(908.0)	(946.6)	(718.3)	(17.4)	(13.7)	(92.0)	(105.2)

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 164

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

23 Financial risk management continued

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.

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.

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 1.17:£1 and US$1.26:£1 (2022/23: 1.13:£1 and US$1.21:£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.

The Group has designated the US$165 million private placement loan notes (2022/23: US$165 million),

with a carrying amount of £130.5 million (2022/23: £133.2 million), as hedges of US$165 million

(2022/23: 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 (2022/23: nil),

with a carrying amount of £154.8 million (2022/23: £nil), as hedges of 181 million (2022/23: nil) 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$165.0 million and

181.0 million net investment hedges is a gain of £7.1 million with a further loss of £36.7 million

relating to previous net investment hedging relationships.

Borrowings are analysed by currency as:

At 31 March 2024

				Private
	Bank		Sustainability-	placement
	overdrafts	Term loan	linked loan	loan notes	Total
	£m	£m	£m	£m	£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)
At 31 March 2023
Sterling	(125.0)	–	–	–	(125.0)
US dollar	(3.4)	–	(24.2)	(133.2)	(160.8)
Euro	–	–	–	(27.2)	(27.2)
Canadian dollar	(9.7)	–	–	–	(9.7)
Other	(1.7)	–	–	–	(1.7)
Total borrowings	(139.8)	–	(24.2)	(160.4)	(324.4)

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 165

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

23 Financial risk management continued

Market risk – interest rate risk

The Group has relatively high interest cover. The Group’s policy dictates regular monitoring of interest

rate exposure with a view to taking suitable actions should exposure reach certain levels. Following the

Group’s acquisition of Distrelec B.V. and its subsidiaries, the Group’s borrowings at variable rates, and

hence its exposure to interest rate risk, increased.

As at 31 March 2024 (and 31 March 2023), 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 2024, 26% (2022/23: 49%) of the Group’s gross borrowings excluding lease liabilities (total

borrowings plus bank overdrafts) was at fixed rates, with surplus cash deposited at variable rates.

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.

	2024		2023
	Impact on		Impact on
	income	Impact on	income	Impact on
	statement	equity	statement	equity
	gain / (loss)	gain / (loss)	gain / (loss)	gain / (loss)
	£m	£m	£m	£m
One percentage point increase in interest rates	(1.9)	–	1.0	–
5% weakening of the euro	1.1	5.4	1.6	0.5
5% weakening of the US dollar	(2.1)	10.0	(6.3)	4.3

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. As at

31 March 2024, the Group had a £400 million sustainability-linked loan facility, with an accordion of up

to a further £100 million, which has a maturity of October 2028 with an option for the Group to extend

for a further one year subject to individual lender approval; 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; and a 150 million term loan maturing in April 2026.

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 (2022/23: 0.2x) and EBITA to interest of 10.5x (2022/23: 34.2x).

There were no significant changes in the Group’s approach to capital management during the year.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 166

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

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.

		Penalties and
		interest on
		uncertain
	Reorganisation	income tax	Dilapidation
	provision	provision	provision	Total
	£m	£m	£m	£m
At 1 April 2023	2.1	4.0	0.4	6.5
Acquisitions (Note 29)	–	0.1	1.4	1.5
Additions	7.6	0.1	0.8	8.5
Utilised	(5.5)	–	–	(5.5)
Released	(0.6)	(1.2)	–	(1.8)
At 31 March 2024	3.6	3.0	2.6	9.2

Analysed in the balance sheet as:

	2024	2023
	£m	£m
Current	5.0	1.8
Non-current	4.2	4.7
	9.2	6.5

The reorganisation provision is expected to be fully spent by March 2027 and the dilapidation

provision is expected to be fully utilised by March 2028.

At 31 March 2024, there were no material contingent liabilities (2022/23: none).

25 Capital commitments

As at 31 March 2024, the Group is contractually committed to, but has not provided for, future capital

expenditure of £8.0 million (2022/23: £3.5 million) for property, plant and equipment and £4.6 million

(2022/23: £2.1 million) for intangible assets.

26 Share capital and share premium

	Number of	Share capital	Share premium	Total
	shares	£m	£m	£m
Issued and fully paid ordinary shares of 10p each:
At 1 April 2022	471,022,022	47.1	231.4	278.5
Issues to settle employee share awards	1,762,387	0.2	4.6	4.8
At 31 March 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

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 2024, the EBT held 343,147 shares

(2022/23: 336,084 shares) which had not yet vested unconditionally with employees.

27 Other reserves

		Cumulative
	Hedging	translation
	reserve	reserve	Total
	£m	£m	£m
At 1 April 2022	(0.7)	60.9	60.2
Foreign exchange translation differences	–	43.0	43.0
Fair value gain on net investment hedges (Note 23)	–	5.4	5.4
Cash flow hedging gains taken to equity	3.9	–	3.9
Tax on other comprehensive income (Note 11)	(0.7)	–	(0.7)
Total comprehensive income	3.2	48.4	51.6
Cash flow hedging gains transferred to inventories	(3.7)	–	(3.7)
Tax on cash flow hedging transferred to inventories	0.7	–	0.7
At 31 March 2023	(0.5)	109.3	108.8
Foreign exchange translation differences	–	(4.0)	(4.0)
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	(0.1)	(0.6)	(0.7)
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	(0.4)	108.7	108.3

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 167

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

28 Related parties

The Group’s joint venture (Note 17) is a related party and during the year, the Group made

sales of £4.0 million (2022/23: £4.5 million) to the joint venture, and a balance of £1.5 million

(2022/23: £2.8 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:

	2024	2023
	£m	£m
Short-term employee benefits	6.1	12.0
Post-employment benefits	0.1	0.2
Termination benefits	0.6	1.8
Share-based payments	1.1	8.1
	7.9	22.1

29 Acquisitions

On 30 June 2023 the Group acquired 100% of the issued share capital of Distrelec B.V. and its

subsidiaries (Distrelec), a high-service, digital-led distributor of industrial and maintenance, repair

and operations (MRO) products in Europe. Distrelec significantly expands the Group’s presence in

continental Europe and will leverage the Group’s existing operations to drive value-accretive growth.

The goodwill is attributable to cost synergies in procurement, logistics and warehousing, and

marketing and administration, in addition to revenue synergies from cross-selling opportunities

of RS’s own brand and solutions offer. Distrelec is included in EMEA.

The fair value of the net assets acquired, consideration paid and goodwill arising, plus transaction

costs and contribution to the Group’s results since acquisition were:

	£m
Intangible assets – customer relationships	73.5
Intangible assets – brands	22.1
Intangible assets – software	10.6
Property, plant and equipment	0.6
Right-of-use assets	29.8
Inventories	51.6
Current trade and other receivables	27.1
Cash and cash equivalents – cash and short-term deposits	9.0
Current trade and other payables	(36.2)
Current lease liabilities	(2.4)
Current provisions	(0.2)
Non-current lease liabilities	(26.1)
Non-current other payables	(11.1)
Non-current other provisions	(1.3)
Current income tax liabilities	(4.9)
Deferred tax liabilities	(14.1)
Net assets acquired	128.0
Indemnification assets (included in non-current other receivables)	2.8
Goodwill	182.3
Consideration paid – cash	313.1
Acquisition-related costs charged to operating costs:
In 2023/24	4.7
In 2022/23	2.8
Revenue since acquisition	134.6
Loss after tax since acquisition	1.1
Trade and other receivables:
Gross contractual amounts receivable	27.9
Estimate of amounts not expected to be collected	0.8

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 168

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

29 Acquisitions continued

The goodwill will not be deductible for tax purposes. The indemnification assets relate to:

– £1.9 million for full indemnification from the sellers of costs under the lease of the regional

distribution centre in the Netherlands from 1 January 2027 to the end of the lease in

November 2036, or when the lease is exited if earlier, measured as the difference between the

right-of-use asset and the lease liability for that lease over that time frame, with a range of outcomes

from £nil to an amount equal to the aggregate of any such costs (capped at the consideration for the

acquisition); and

– £0.9 million for contractual indemnifications relating to uncertain tax provisions measured on the

same basis as the provisions, with a range of outcomes from £nil to £0.9 million.

If the acquisition had occurred on 1 April 2023, the Group’s revenue and profit for the year ended

31 March 2024 would have been £2,992.0 million and £178.5 million respectively, including the

additional amortisation of acquired intangibles that would have been charged and the consequential

tax effects.

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.

On 2 April 2024 the Group acquired Trident Australia Pty Ltd (Trident), a specialist MRO distribution

and rental, calibration and mechanical services partner for the energy and natural resource industry in

Australia, for an estimated £8.0 million on a debt-free, cash-free, tax-free basis. The completion

accounts are being prepared and once agreed the consideration will be finalised and the fair value of

the net assets acquired assessed.

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.

	Country of	Class of
Name and registered address of undertaking	incorporation	share held
Distributor of product and service solutions
RS Components Pty Limited*	Australia	Ordinary
25, Pavesi Street, Smithfield, Sydney NSW 2164, Australia
Distrelec Gesellschaft m.b.H.*	Austria	Ordinary
J agdgasse 25, 1100 Wien, Austria
RS Components Handelsgesellschaft m.b.H*	Austria	Share of equity
Albrechtser Straße 11, 3950, Gmünd, Austria

		Country of	Class of
Name and registered address of undertaking		incorporation	share held
RS Integrated Supply Belgium*		Belgium	Ordinary
Louizalaan 65/11, 1050 Elsene, Belgium
RS Americas (Canada), Inc.*		Canada	Common
1155	Lola Street, Unit 6, Ottawa, ON, K1K 4C1, Canada
RS Integrated Supply Canada Corp.*		Canada	Common
600-1741 Lower Waters Street, Halifax NS B3J 0J2, Canada
RS Group Limitada (DBA – RS Limitada)*		Chile	Ordinary
Av. Eduardo Frei Montalva, 6001-71 Conchali, Santiago, Chile
RS Components Limited*		China	Ordinary
Suite 1608, Cheong Road, Kwai Chung, Hong Kong	Level 16, Tower 1, Kowloon Commerce Centre, 51 Kwai
RS Components (Shanghai) Company Limited*		China	Ordinary
Unit 501, Floor 5, Building C, The New Bund World Trade Center Phase II, No.3, Lane 227, Dong Yu Road, Pudong Shanghai, China
Elfa Distrelec A/S*		Denmark	Ordinary
Haslegårdsvej 8-12, 8210 Aarhus V , Denmark
RS Components A/S*		Denmark	Ordinary
Nattergalevej 6, 2400, København NV, Denmark
Risoul Dominicana S.R.L*		Dominican	Ordinary
Autopista Duarte KM 17, Calle Los Almejos, Palma Enana No 13, Nave 1, Villa Linda, Palmarejito, Santo Domingo Oeste, Dominican Republic		Republic
Elfa Distrelec OÜ*		Estonia	Ordinary
Hobujaama 4, Tallinn 10151 Estonia
Elfa Distrelec Oy*		Finland	Ordinary
Bertel Jungin Aukio 5, FI-02600, Finland
RS Components SAS*		France	Ordinary
Rue Norman King, 60000, Beauvais, France
RS Integrated Supply France*		France	Ordinary
Rue Norman King BF 453, F-60031 Beauvais Cedex, France
Distrelec Deutschland GmbH*		Germany	Ordinary
Lise-Meitner-Str. 4, DE-28359 Bremen, Germany
RS Components GmbH*		German y	Ordinar y
Mainzer Landstraße 180, 60327, Frankfurt, Germany
RS Integrated Supply Deutschland GmbH*		Germany	Ordinary
Bleibtreustr. 21, 10623, Berlin, Germany

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 169

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

30 Related undertakings continued

					Country of	Class of
Name and registered address of undertaking					incorporation	share held
RS Integrated Supply Hungary Korlátolt Felel			sség	Társaság*	Hungary	Ordinary
1062, RS Components & Controls (India) Limited*†	1-3. Tower A, 6th floor, Budapest, Hungary				India	Ordinary
222	Okhla Industrial Estate, New Delhi, India
Distrelec Italia S.r.l.*					Italy	Ordinary
Via Ramazzotti 12, 20045 Lainate, Italy
RS Components S.r.l.*					Italy	Ordinary
Sesto san Giovanni, Viale Thomas Alva Edison, 110, 20099, MI, Italy
RS Integrated Supply Italy S.r.l.*					Italy	Ordinary
Sesto san Giovanni, Viale Thomas Alva Edison, 110, 20099, MI, Italy
RS Components KK*					J apan	Ordinary
West Tower 12F, Yokohama Business Park, 134 Godocho, Hodogaya, Yokohama, Kanagawa, 240-0005, Japan
Elfa Distrelec SIA*					Latvia	Ordinary
Kri j	a Valdem	ra iela 62, R ga LV 1013, Latvia
Elfa Distrelec, UAB*					Lithuania	Ordinary
Visori	g. 2-309, LT-08300 Vilnius, Lithuania
RS Components Sdn. Bhd.*					Malaysia	Ordinary
Suite 9D, Level 9, Menara Ansar, 65 Jalan Trus, Johor Bahru, 80000, J ohor, Malaysia
Allied Electronics & Automation S. de R.L. de C.V.*					Mexico	Ordinary
Avenida Circunvalación Agustin Yalez N° 2613 Int. 1A 105, Colonia Arcos
Vallarta Sur, Guadalajara Jalisco, 44500 Mexico
Risoul y Cia, S.A. de C.V.*					Mexico	Ordinary
Avenida Sendero Divisorio 400, Residencia Casa Bella, San Nicolas de los
Garza, Nuevo Leon, 66428, Mexico
Storeroom Solutions Mexico, S. de R.L. de C.V.*					Mexico	Ordinary
Florencia 57 P, 3 Juarez Distritio Federal, 06600, Mexico
Distrelec B.V.*					Netherlands	Ordinary
De Tweeling 28, 5215 MC ‘s Hertogenbosch, Netherlands
Liscombe B.V.*					Netherlands	Ordinary
J armuiden 56 a, 1046 AE, Amsterdam, Netherlands
RS Components B.V.*					Netherlands	Ordinary
Bingerweg 19, 2031 AZ Haarlem, Netherlands

			Country of	Class of
Name and registered address of undertaking			incorporation	share held
RS Integrated Supply Netherlands B.V.*			Netherlands	Ordinary
Bingerweg 19, 2031 AZ Haarlem, Netherlands
RS Components Limited*			New Zealand	Ordinary
KPMG, 18 Viaduct Harbour Avenue, Auckland, 1010, New Zealand
Elfa Distrelec AS*			Norway	Ordinary
Apotekergata 10B, 0180 Oslo Norway
RS Components AS*			Norway	Ordinary
10. etg., Fredrik Selmers vei 6, Oslo, RS Components Corporation*	0663,	Norway	Philippines	Common and
21st Floor Multinational Bancorporation Centre, 6805 Ayala Avenue, Makati City, Philippines				preference
Elfa Distrelec Sp. z.o.o*			Poland	Ordinary
Al. Jerozolimskie 136, PL-02-305, Warszawa, Poland
RS Components sp. z.o.o.*			Poland	Ordinary
Ul. Domaniewska 48, 02-672, Warszawa, Poland
RS Integrated Supply Poland Sp. z.o.o.*			Poland	Ordinary
Ul. Domaniewska 48, 02-672, Warszawa, Poland
Radionics Limited*			Republic	Ordinary
Glenview Industrial Estate, Herberton Road, Rialto, Dublin 12, Ireland			of Ireland
RS Integrated Supply Ireland Limited*			Republic	Ordinary
Glenview Industrial Estate, Herberton Road, Rialto, Dublin 12, Ireland			of Ireland
Synovos Ireland Limited*			Republic	Ordinary
70 Sir John Rogerson’s Quay, Dublin 2, Ireland			of Ireland
RS Components Pte Ltd*			Singapore	Ordinary
112	Robinson Road, #05-01, 068902, Singapore
RS Integrated Supply Singapore Pte. Ltd.*			Singapore	Ordinary
10 Ubi Crescent, #06-18 Ubi Techpark, 408564, Singapore
Synovos Singapore Pte. Ltd.*			Singapore	Ordinary
1 Marina Boulevard, #28-00, One Marina Boulevard, 018989, Singapore
RS Integrated Supply Slovakia s.r.o.*			Slovakia	Ordinar y
Landererova 12, Bratislava- mestská	as	Staré Mesto, 81109, Slovakia
Amidata S.A.U.*			Spain	Ordinary
Avenida de Bruselas 6, Alcobendas, 28108, Madrid, Spain
Risoul Iberica SA*			Spain	Ordinary
08402 – Granollers, calle Girona, numero 85, Barcelona, Spain

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 170

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

30 Related undertakings continued

		Country of	Class of
Name and registered address of undertaking		incorporation	share held
Elfa Distrelec AB*		Sweden	Ordinary
Kronborgsgränd 1, 164 46 Kista, Sweden
RS Components AB*		Sweden	Ordinary
Kronborgsgränd 1, 164 46 Kista, Sweden
RS Integrated Supply Sweden AB*		Sweden	Ordinary
Drottninggatan 96, 113 60, Stockholm, Sweden
Distrelec Schweiz AG*		Switzerland	Ordinary
Grabenstrasse 6, 8606 Nänikon, Switzerland
Domnick (Thailand) Co., Ltd.* (86.74%)		Thailand	Ordinary
No. 99/1-3, Naradhiwas Rajanagarindra Road, Chong Nonsi, Yan Nawa, Bangkok, 10120, Thailand
RS Components Co., Ltd*		Thailand	Ordinary
GMM Grammy Place, Room No. 1901-1904, Floor 19, No. 50, Sukhumvit 21
(Asoke), Klongtoey Nua, Wattana, Bangkok, 10110, Thailand
Distrelec Ltd*		UK	Ordinary
7th floor, 2 St Peter’s Square, Manchester, M2 3AA, UK
IESA A & D Limited*		UK	Ordinary
IESA Works Daten Park, Birchwood, Warrington, Cheshire, WA3 6UT, UK
J ohn Liscombe Limited*		UK	Ordinary and
Fifth Floor, Two Pancras Square, London N1C 4AG, UK			preference
Needlers Limited*		UK	Ordinary and
Fifth Floor, Two Pancras Square, London N1C 4AG, UK			preference
OKdo Technology Limited*		UK	Ordinary
Fifth Floor, Two Pancras Square, London N1C 4AG, UK
RS Components Limited		UK	Ordinary
Birchington Road, Weldon, Corby, Northamptonshire, NN17 9RS, UK
RS Integrated Supply UK Limited*		UK	Ordinary
IESA Works Daten Park, Birchwood, Warrington, Cheshire, WA3 6UT, UK
MRO Distribution, Inc.*		United States	Common
Two Radnor Corporate Center, Suite 400, Radnor, PA 19087, United States		of America
New DEAM, LLC*		United States	Common
Two Radnor Corporate Center, Suite 400, Radnor, PA 19087, United States		of America
RS Americas, Inc*		United States	Common
7151	Jack Newell Blvd S., Fort Worth, TX 76118, United States	of America

		Country of	Class of
Name and registered address of undertaking		incorporation	share held
RS Integrated Supply Puerto Rico LLC*		United States	Common
Two Radnor Corporate Center, Suite 400, Radnor, PA 19087, United States		of America
RS Integrated Supply US Inc.*		United States	Common
Two Radnor Corporate Center, Suite 400, Radnor, PA 19087, United States		of America
Holding, Financing and Management Companies
Electrocomponents Limited		China	Ordinary
Suite 1608, Road, Kwai Chung, Hong Kong	Level 16, Tower 1, Kowloon Commerce Centre, 51 Kwai Cheong
RS Components Business Services (Foshan) Limited*		China	Ordinary
22nd Floor, Glory International Financial Center, No.25, Ronghe Road, Guicheng, Nanhai District, Foshan, Guangdong, 528200, China
Electrocomponents France SARL*		France	Ordinary
Rue Norman King, 60000, Beauvais, France
Bodenfeld Immobilien GmbH*		Germany	Ordinary
Mainzer Landstraße 180, 60327, Frankfurt, Germany
Electrocomponents Jersey Finance Unlimited*		J ersey	Common
44 Esplanade, St Helier, JE4 9WG Jersey
Synovos Netherlands C.V.*		Netherlands	Partnership
Two Radnor Corporate Center, Suite 400, Radnor, PA 19087, United States
Electrocomponents Holdings (Thailand) Limited* (49.00%)		Thailand	Ordinary
GMM Grammy Place, Room No. 1901-1904, Floor 19, No. 50, Sukhumvit 21
(Asoke), Klongtoey Nua, Wattana, Bangkok, 10110, Thailand
Electrocomponents Newco (Thailand) Limited* (86.73%)		Thailand	Ordinary
GMM Grammy Place, Room No. 1901-1904, Floor 19, No. 50, Sukhumvit 21
(Asoke), Klongtoey Nua, Wattana, Bangkok, 10110, Thailand
Electrocomponents (Thailand) Limited* (73.99%)		Thailand	Ordinary
GMM Grammy Place, Room No. 1901-1904, Floor 19, No. 50, Sukhumvit 21
(Asoke), Klongtoey Nua, Wattana, Bangkok, 10110, Thailand
Electrocomponents Overseas Limited*		UK	Ordinary
Fifth Floor, Two Pancras Square, London N1C 4AG, UK
Electrocomponents US Finance Limited*		UK	Ordinary
Fifth Floor, Two Pancras Square, London N1C 4AG, UK
IESA A & D Holdings Limited*		UK	Ordinary
IESA Works Daten Park, Birchwood, Warrington, Cheshire, WA3 6UT, UK

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 171

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

NOTES TO THE GROUP ACCOUNTS CONTINUED

For the year ended 31 March 2024

30 Related undertakings continued

		Country of	Class of
Name and registered address of undertaking		incorporation	share held
IESA Holdings Limited*		UK	Ordinary
IESA Works Daten Park, Birchwood, Warrington, Cheshire, WA3 6UT, UK
Needlers Holdings Limited*		UK	Ordinary and
Fifth Floor, Two Pancras Square, London N1C 4AG, UK			preference
RS Components Holdings Limited*		UK	Ordinary
Fifth Floor, Two Pancras Square, London N1C 4AG, UK
RS Group International Holdings Limited		UK	Ordinary
Fifth Floor, Two Pancras Square, London N1C 4AG, UK
RS Group Pension Trustees Limited		UK	Ordinary
Fifth Floor, Two Pancras Square, London N1C 4AG, UK
Electrocomponents, Inc*		United States	Common and
7151	Jack Newell Blvd S., Fort Worth, TX 76118, United States	of America	preference
Electrocomponents North America, Inc.*		United States	Common
7151	Jack Newell Blvd S., Fort Worth, TX 76118, United States	of America
Electrocomponents North America LLC*		United States	Common
7151	Jack Newell Blvd S., Fort Worth, TX 76118, United States	of America
Electrocomponents (US), Inc.*		United States	Common
7151	Jack Newell Blvd S., Fort Worth, TX 76118, United States	of America
Electrocomponents US LLC*		United States	Common
7151	Jack Newell Blvd S., Fort Worth, TX 76118, United States	of America
Synovos International, Inc.*		United States	Common
Two Radnor Corporate Center, Suite 400, Radnor, PA 19087, United States		of America
Not currently trading
RS Components (Proprietary) Limited*		South Africa	Ordinary
20 Indianapolis Street, Kyalami Business Park, Kyalami Midrand, Gauteng, 1684, Risoul (Trinidad and Tobago) Limited*	South Africa	Trinidad and	Ordinary
Nunez & Co, Level 2, Invaders Bay Tower, Invaders Bay, Off Audrey Jeffers		Tobago
Highway, Port of Spain, Trinidad and Tobago
Electro Lighting Group Limited*		UK	Ordinary
Fifth Floor, Two Pancras Square, London N1C 4AG, UK
IESA Limited		UK	Ordinary
Fifth Floor, Two Pancras Square, London N1C 4AG, UK

	Country of	Class of
Name and registered address of undertaking	incorporation	share held
RS Limited*	UK	Ordinary
Fifth Floor, Two Pancras Square, London N1C 4AG, UK

† Note 17 provides details about the Company’s interest in the joint venture.

RS Components Limited (UK), RS Components B.V. (Netherlands) and RS Components GmbH

(Germany) operate branch offices in South Africa, the Philippines, China (Taiwan), Belgium and

Switzerland.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 172

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Group accounts continued

COMPANY BALANCE SHEET COMPANY STATEMENT OF CHANGES IN EQUITY

As at 31 March 2024 For the year ended 31 March 2024

Notes

2024

£m

2023

£m

Fixed assets

Tangible assets 7 15.1 15.7

Investments in subsidiaries 8 648.6 491.2

Total fixed assets 663.7 506.9

Current assets

Debtors: amounts falling due after more than one year 10 0.7 2.2

Debtors: amounts falling due within one year 10 1,242.6 995.7

Cash at bank and in hand 104.6 171.3

Total current assets 1,347.9 1,169.2

Creditors: amounts falling due within one year 11 (531.2) (512.0)

Net current assets 816.7 657.2

Total assets less current liabilities 1,480.4 1,164.1

Creditors: amounts falling due after more than one year 12 (440.9) (185.6)

Net assets 1,039.5 978.5

Capital and reserves

Share capital 16 47.4 47.3

Share premium account 16 239.5 236.0

Own shares held by Employee Benefit Trust (EBT) 16 (1.8) (2.2)

Profit and loss account (including profit for the year

of £155.6 million (2022/23: £142.5 million)) 16 754.4 697.4

Total equity 1,039.5 978.5

The Company accounts on pages 173 to 177 were approved by the Board of Directors on 22 May 2024

and were signed on its behalf by:

Kate Ringrose

Chief Financial Officer

RS Group plc

Company number: 647788

Share capital

£m

premium

account

£m

Own shares

held by EBT

£m

Profit and

loss account

£m

Total

£m

At 1 April 2022 47.1 231.4 (3.0) 632.1 907.6

Profit and total comprehensive income for

the year – – – 142.5 142.5

Dividends (Note 16) – – – (88.6) (88.6)

Equity-settled share-based payments (Note 5) – – – 14.2 14.2

Settlement of share awards (Note 16) 0.2 4.6 2.9 (2.9) 4.8

Purchase of own shares by EBT (Note 16) – – (2.1) – (2.1)

Tax on equity-settled share-based payments – – – 0.1 0.1

At 31 March 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

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 173

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Company accounts

NOTES TO THE COMPANY ACCOUNTS

For the year ended 31 March 2024

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

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.

4 Employees

Average number of employees 2024 2023

Management and administration 69 63

Aggregate employment costs

2024

£m

2023

£m

Wages and salaries 6.9 8.0

Social security costs 0.9 1.9

Share-based pa

ments – equit

-settled (Note 5) (0.2) 3.8

Share-based payments – cash-settled (0.4) (0.2)

Defined contribution retirement benefit costs (Note 6) 0.4 0.3

7.6 13.8

Termination benefits 0.6 1.4

Total 8.2 15.2

Information on the Directors’ remuneration is in the Directors’ Remuneration Report on pages 99 to 115.

The numbers and costs 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 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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 174

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Company accounts continued

NOTES TO THE COMPANY ACCOUNTS CONTINUED

For the year ended 31 March 2024

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 2023 and 31 March 2024 18.2 1.2 9.2 0.8 29.4

Depreciation

At 1 April 2023 3.0 0.7 9.2 0.8 13.7

Charged in the year 0.5 0.1 – – 0.6

At 31 March 2024 3.5 0.8 9.2 0.8 14.3

Net book value

At 31 March 2024 14.7 0.4 – – 15.1

At 31 March 2023 15.2 0.5 – – 15.7

8 Investments in subsidiaries

Investments in subsidiaries, including loans that are expected to be repaid after more than one year

although there is an option for the Company to require repayment on demand, are carried at the

lower of cost and expected recoverable amount. 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 2024, this amounted to

£8.0 million (2022/23: £10.4 million).

£m

Loans

£m

Total

£m

Cost

At 1 April 2023 227.9 279.1 507.0

Additions 8.0 155.5 163.5

Written off on strike off of subsidiary (0.5) (0.3) (0.8)

Translation differences – (6.0) (6.0)

At 31 March 2024 235.4 428.3 663.7

Impairments

At 1 April 2023 0.4 15.4 15.8

Written off on strike off of company (0.4) (0.3) (0.7)

At 31 March 2024 – 15.1 15.1

Net book value

At 31 March 2024 235.4 413.2 648.6

At 31 March 2023 227.5 263.7 491.2

A number of non-trading subsidiaries were struck off during the year.

A list of the Company’s related undertakings is in Note 30 to the Group accounts.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 175

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Company accounts continued

NOTES TO THE COMPANY ACCOUNTS CONTINUED

For the year ended 31 March 2024

9 Financial instruments

Basic financial instruments

Basic 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.

Basic 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.

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.

10 Debtors

2024

£m

2023

£m

Amounts falling due within one year:

Amounts owed by subsidiary undertakings 1,233.8 988.1

Other derivative assets 3.8 3.4

Prepayments 5.0 4.2

Debtors: amounts falling due within one year 1,242.6 995.7

Amounts falling due after more than one year:

Deferred tax asset (Note 13) 0.7 2.2

Debtors: amounts falling due after more than one year 0.7 2.2

Amounts owed by subsidiary undertakings are unsecured, bear interest at market rates and are

repayable on demand.

11 Creditors: amounts falling due within one year

2024

£m

2023

£m

Amounts owed to subsidiary undertakings 353.7 363.8

Bank overdrafts 157.6 134.0

Other derivative liabilities 3.8 3.4

Accruals 7.9 10.3

Other creditors 8.1 0.2

Cash-settled share-based payment liability 0.1 0.3

531.2 512.0

Amounts owed to subsidiary undertakings are unsecured, bear interest at market rates and are

repayable on demand.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 176

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Company accounts continued

NOTES TO THE COMPANY ACCOUNTS CONTINUED

For the year ended 31 March 2024

12 Creditors: amounts falling due after more than one year

2024

£m

2023

£m

Unsecured private placement loan notes repayable after more than five

years 78.4 80.0

Unsecured private placement loan notes repayable from three to four years – 80.4

Unsecured private placement loan notes repayable from two to three years 78.7 –

Unsecured sustainability-linked loan repayable from four to five years 155.0 24.2

Unsecured term loan repayable from two to three years 128.2 –

Other creditors 0.4 0.7

Cash-settled share-based payment liability 0.2 0.3

440.9 185.6

Details of the private placement loan notes, sustainability-linked loan are in Notes 21 to 23 of the

Group accounts.

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:

2024

£m

2023

£m

Equity-settled share-based payments 0.7 2.1

Other – 0.1

Deferred tax asset (Note 10) 0.7 2.2

There are no unused tax losses or unused tax credits.

14 Operating lease commitments

Future minimum amounts payable under non-cancellable operating leases are:

2024

£m

2023

£m

Within one year 1.2 1.2

From one to five years 2.8 4.0

4.0 5.2

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

£86.7 million (2022/23: £81.4 million), of which £8.8 million (2022/23: £9.3 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.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 177

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Company accounts continued

FIVE YEAR RECORD

Year ended 31 March

Summary income statements and related metrics

2024

£m

2023

£m

2022

£m

2021

£m

2020

£m

Revenue 2,942.4 2,982.3 2,553.7 2,002.7 1,953.8

Operating profit 280.1 383.0 308.8 167.2 205.3

Add back: amortisation and impairment

of acquired intangibles 26.6 16.6 11.6 7.0 5.4

Add back: acquisition-related items 5.1 2.6 – 2.9 –

Add back: substantial reorganisation costs

and substantial asset write-downs – – – 11.2 10.0

Adjusted operating profit 311.8 402.2 320.4 188.3 220.7

Net finance costs (31.9) (12.2) (7.1) (6.8) (5.9)

Share of profit of joint venture 0.6 0.7 0.5 0.2 0.2

Adjusted profit before tax 280.5 390.7 313.8 181.7 215.0

Amortisation and impairment of acquired

intangibles (26.6) (16.6) (11.6) (7.0) (5.4)

Acquisition-related items (5.1) (2.6) – (2.9) –

Substantial reorganisation costs

and substantial asset write-downs – – – (11.2) (10.0)

Profit before tax 248.8 371.5 302.2 160.6 199.6

Income tax expense (65.1) (86.7) (72.2) (35.1) (44.9)

Profit for the year attributable to owners

of the Compan

183.7 284.8 230.0 125.5 154.7

Earnings per share 38.8p 60.4p 48.9p 27.7p 34.7p

Adjusted earnings per share 43.8p 63.6p 51.3p 31.3p 37.7p

Dividend per share

22.0p 20.9p 18.0p 15.9p 15.4p

Summary balance sheets and other metrics

2024

£m

2023

£m

2022

£m

2021

restated

£m

2020

£m

Non-current assets 1,257.0 953.7 706.1 711.0 573.4

Current assets 1,641.4 1,590.3 1,395.1 1,134.8 1,044.3

Current liabilities (815.3) (838.9) (726.2) (631.8) (570.4)

Non-current liabilities (650.2) (360.2) (266.5) (314.6) (327.4)

Net assets 1,432.9 1,344.9 1,108.5 899.4 719.9

Add back: net debt 418.2 113.0 42.1 122.0 189.8

Add back: retirement benefit net

assets / obligations 25.7 36.4 12.4 55.7 55.8

Capital employed 1,876.8 1,494.3 1,163.0 1,077.1 965.5

Return on capital employed (ROCE)

17.4% 30.8% 28.7% 19.4% 24.0%

Adjusted free cash flow 151.2 263.6 162.9 145.4 80.9

Average number of employees 8,964 7,818 7,383 6,806 7,044

Share price at 31 March 726.8p 914.0p 1,084.0p 993.0p 516.2p

1 An additional interim dividend for the year ended 31 March 2020 of 9.5p, to replace the deferred final dividend, was paid on

18 December 2020. This is included in the 2019/20 dividend per share amount.

2 ROCE for the year ended 31 March 2020 was updated in 2020/21 to be based on monthly average capital employed.

3 Restated in 2021/22 for measurement period adjustments for prior year acquisitions.

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 178

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Five year record

REGISTERED OFFICE, FINANCIAL CALENDAR

AND ADVISORS

Shareholder information

Be scam smart

Investment scams are designed to look like

genuine investments.

Spot the warning signs

Have you been:

– Contacted out of the blue?

– Promised tempting returns and told the

investment is safe?

–Called repeatedly?

– 7ROGWKHRࢆHULVRQO\DYDLODEOHIRUDOLPLWHGWLPH"

If so, you might have been contacted by fraudsters.

Avoid investment fraud

Reject cold calls

If you have received unsolicited contact about

an investment opportunity, the chances are it is

a high-risk investment or a scam. You should treat

the call with extreme caution. The safest thing to

do is to hang up.

Check the FCA Warning List

7KH)&$:DUQLQJ/LVWLVDOLVWRIࢉUPVDQG

individuals we know are operating without

our authorisation.

Get impartial advice

7KLQNDERXWJHWWLQJLPSDUWLDOࢉQDQFLDODGYLFH

before you hand over any money. Seek advice

IURPVRPHRQHXQFRQQHFWHGWRWKHࢉUPWKDWKDV

approached you.

Your shareholder reference number (SRN) is

required to access your shareholding. This can be

found at the top of your welcome letter or share

FHUWLࢉFDWH$OWHUQDWLYHO\\RXFDQREWDLQ\RXU651

by contacting Computershare on the number

given above.

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

www.investorcentre.co.uk or in the Shareholder

Information section of our website under FAQs.

Alternatively, please contact Computershare on

the number given above, and 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

5HJLVWHUHGRࢇFH

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

www.investorcentre.co.uk/contactus

Investor Centre

To access online information about your

shareholding visit www.investorcentre.co.uk.

Through the Investor Centre you can:

– Update member details and address changes

– Update dividend bank mandate instructions

and review dividend payment history

– Register to receive Company

communications electronically

Report a scam

If you suspect that you have been approached

by fraudsters please tell the FCA using the

reporting form at

www.fca.org.uk/consumers/report-scam-us.

You can also call the FCA Consumer Helpline on

0800 111 6768.

If you have lost money to investment fraud, you

should report it to Action Fraud on 0300 123 2040

or online at www.actionfraud.police.uk

Find out more at www.fca.org.uk/scamsmart

Remember: if it sounds too good to be true, it

probably is!

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 179

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

FIND US

ONLINE

Shareholder information continued

Get more online

Latest shareholder information

–Share price

– Corporate governance

– Analyst consensus estimates

– Updates via email

Archive information

–Financial results

–Annual Reports

–Company news

– Video library

For more information and the latest news, including details of our

principal locations, visit: rsgroup.com

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 mid-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

Auditors

2023/24

PricewaterhouseCoopers LLP

1 Embankment Place

London WC2N 6RH

2024/25

Deloitte LLP

2 New Street Square

London EC4A 3BZ

Financial public relation advisors

Teneo

The Carter Building,

11 Pilgrim Street

London EC4V 6RN

Financial advisors and corporate

brokers

Rothschild & Co

New Court

St Swithin’s Lane

London EC4N 8AL

J.P. Morgan Cazenove

25 Bank Street

Canary Wharf

London E14 5JP

Barclays

1 Churchill Place

Canary Wharf

London E14 5HP

Registrar and transfer office

Computershare Investor Services PLC

The Pavilions

Bridgwater Road

Bristol

BS99 6ZZ

Solicitors

Allen Overy Shearman Sterling LLP

One Bishops Square

London E1 6AD

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 180

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

Shareholder information continued

A&C Automation and control

AGM Annual general meeting

AI $UWLࢉFLDOLQWHOOLJHQFH

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 &KLHI([HFXWLYH2ࢇFHU

CFO &KLHI)LQDQFLDO2ࢇFHU

CISO &KLHI,QIRUPDWLRQ6HFXULW\DQG&RPSOLDQFH2ࢇFHU

e Carbon dioxide equivalent

CoE Centre of Expertise

CPO &KLHI3HRSOH2ࢆFHU

CSRD Corporate Sustainability Reporting Directive

D&I Diversity and inclusion

DC Distribution centre

DJSI Dow Jones Sustainability Indices

DRIP Dividend Reinvestment Plan

DRR Directors’ Remuneration Report

DSBP Deferred share bonus plan

DTAM Distributor total addressable market

EBITA Earnings before interest, taxes and amortisation

EBITDA Earnings before interest, taxes, depreciation

and amortisation

EMD Environmental management dashboard

EPS Earnings per share

ERG Employee resource groups

ESG Environmental, social and governance

EU European Union

EV Electric vehicles

EWB Engineers Without Borders-International

ExCo Executive Committee

FC )XOࢉOPHQWFHQWUH

FCA Financial Conduct Authority

FRC Financial Reporting Council

FRS Financial Reporting Standard

GSBS Global Shared Business Services

GHG Greenhouse gas

IAS International accounting standards

ICFR ,QWHUQDOFRQWUROVRYHUࢉQDQFLDOUHSRUWLQJ

IFRS International Financial Reporting Standard

IoT Internet of things

ISSB International Sustainability Standards Board

J2G Journey to Greatness

KPIs Key performance indicators

LGBTQIA+ Lesbian, gay, bisexual, transgender, queer, intersex

and others

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

OEM Original equipment manufacturer

ORE 2ࢆVKRUH5HQHZDEOH(QHUJ\

OTTP On time to promise

PBT 3URࢉWEHIRUHWD[

PMI Purchasing Manager Index

PPE Personal protective equipment

PwC PricewaterhouseCoopers LLP

QBR Quarterly business review

ROCE Return on capital employed

RS YAY! RS YAY! all employee share award

SAYE Save as you earn

SBC Single-board computing

SBT Science-based targets

GLOSSARY

OF TERMS

SBTi Science Based Targets initiative

SEO Search engine optimisation

SID Senior Independent Director

SLL Sustainability-linked loan

SMT Senior Management Team

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

RS Group plc Annual Report and Accounts for the year ended 31 March 2024 181

STRATEGIC REPORT GOVERNANCE REPORT FINANCIAL STATEMENTS OTHER INFORMATION

RS Group plc

Fifth Floor

Two Pancras Square

London N1C 4AG

United Kingdom

Tel: +44 (0)20 7239 8400

rsgroup.com

Designed and produced by