INVESTING TO GROW
CHEMRING GROUP PLC
ANNUAL REPORT AND ACCOUNTS 2023

OUR PURPOSE
Chemring helps make the world a safer place. Across physical and digital environments, our exceptional teams
deliver innovative technologies and products that detect and defeat ever-changing threats.
> READ MORE ON PAGES 6 TO 7
OUR VISION
To be our customers’ preferred supplier operating in niche markets with high barriers to entry and where
weenjoy sole source, or market-leading, positions.
CAPITALISE ON THE GROWTH
INOUR NICHE MARKETS
GROW OUR MARKET-LEADING
ANDSOLE SOURCE POSITIONS
> READ MORE ON PAGES 18 TO 19
OUR ESG PILLARS
The long-term success of the Chemring business can only be enhanced by a positive interaction with all of
ourstakeholders, and therefore a positive and engaged approach tocorporate responsibility and sustainability
isimportant to us. Our approach is focused around the following key areas:
HEALTH AND
SAFETY
ENVIRONMENT PEOPLE ETHICS AND
BUSINESS
CONDUCT
> READ MORE ON PAGES 38 TO 62
OUR VALUES
Innovating to protect lies at the core of our foundations, underpinned by our values of Safety, Excellence
andInnovation. Every day, our people play an essential role in protecting armed forces, national security
andcommercial operations in sovereign states across the globe.
SAFETY
We place safety atthe heart of
everything we do.
EXCELLENCE
We are focused onensuring we
consistently meet highstandards
in allthat we do.
INNOVATION
We create world-class solutions
and develop world-class thinking.
STRATEGIC REPORT
01 2023 performance
02 What we do
04 Sustainability overview
06 Our purpose in action
08 Chairman’s statement
10 Investment case
12 Group Chief Executive’s review
16 Market overview
18 Strategy
20 Key performance indicators
24 Business model
26 Focus on Sensors & information
30 Focus on Countermeasures
&Energetics
34 Section 172 statement
35 Stakeholder engagement
38 Introduction to sustainability
42 Health and safety
44 Environment
48 Task Force on Climate-related
Financial Disclosures
(“TCFD”)report
56 Our people
61 Ethics and business conduct
63 Financial review
67 Risk management
69 Principal risks and uncertainties
77 Viability statement and going concern
78 Non-financial and sustainability
information statement
GOVERNANCE
80 Chairman’s introduction
togovernance
82 Board of directors
84 Corporate governance report
94 Audit Committee report
98 Nomination Committee report
100 Directors’ remuneration report
123 Directors’ report
FINANCIAL STATEMENTS
127 Consolidated income statement
128 Consolidated statement of
comprehensiveincome
129 Consolidated statement of
changesin equity
130 Consolidated balance sheet
131 Consolidated cash flow statement
132 Notes to the Group financial
statements
160 Parent company balance sheet
161 Parent company statement of
comprehensiveincome
161 Parent company statement of
changes inequity
162 Notes to the parent company
financialstatements
166 Accounting policies
173 Independent auditor’s report
tothe members of Chemring
GroupPLC
179 Five-year record
OTHER INFORMATION
180 Corporate information
andwebsite
> DISCOVER MORE ABOUT CHEMRING AT
CHEMRING.COM
> READ MORE ON PAGE 25
CONTENTS

2023 PERFORMANCE
FINANCIAL HIGHLIGHTS
ORDER INTAKE
REVENUE
£472.6m
(+18%) (+19% at constant currency)
Increase in revenue driven by strong
performance at Roke and growth in
nicheEnergetics businesses.
UNDERLYING OPERATING
PROFIT*
£69.2m
(+16%) (+21% at constant currency)
Reflects the strong operational
delivery at Roke together with
thericher margin mix in
Countermeasures & Energetics.
UNDERLYING DILUTED
EARNINGS PERSHARE*
20.0p
(2022: 18.5p)
Increase reflects the higher
underlying operating profit, offset
by a higher Group effective tax rate.
STATUTORY OPERATING
PROFIT
£45.4m
(-8%) (-3% at constant currency)
The difference to underlying operating
profit reflects the amortisation of
acquired intangible assets, acquisition
expenses, impairment of chemical
detection assets and gain on the
movement in fair value of derivatives
which are the only items treated as
non-underlying in 2023.
CASH CONVERSION
90%
(2022: 110%)
Continued strong cash conversion,
with an average of 101% on a rolling
36-month basis (2022: 108%),
driven by a continued focus on
working capital disciplines.
ORDER BOOK
£922m
(2022: £651m)
Increase in order book provides
79% (2022: 86%) cover of 2024
Group revenue, with 71% of 2025
and 65% of 2026 expected revenue
cover in Countermeasures & Energetics.
OUTLOOK
The strong market for Roke’s active Cyber Defence/Mission Support
servicesand Electronic Warfare products, the projected growth and capacity
expansion in our niche precision engineered devices and speciality materials
businesses, underpinned by the record order book, all support a strong
medium-term outlook.
GROUP
£756m
SENSORS & INFORMATION
£215m
> READ MORE ON PAGES 26 TO 29
COUNTERMEASURES & ENERGETICS
£541m
> READ MORE ON PAGES 30 TO 33
KEY ACHIEVEMENTS
- 2023 was slightly ahead of the Board’s initial expectations despite foreign
exchange headwinds
- Record order intake of £756m, with growth across both segments:
> Order intake for Countermeasures & Energetics was £541m, up 52%,
driven by strong demand at our niche Energetics businesses where
order intake was up 161%
> Order intake for Sensors & Information was £215m, up 10%, with
Roke continuing to execute its growth strategy
- Closing order book at the highest level in over a decade at £922m
- Roke revenue was up 45% to £160m and order intake up 9% to £183m
with the business well positioned to continue its growth trajectory in what
continues to be a buoyant market
- Net debt was £14.4m (2022: £7.2m), with strong operating cash generation
and cash conversion of 101% on a rolling 36-month basis (2022: 108%).
Netdebt to underlying EBITDA was 0.16 times (2022: 0.09 times)
- £120m capacity expansion plan to 2026 initiated to capitalise on growing
demand in the energetics market, delivering expected incremental revenue of
£85m per annum from 2026/27
- £9m deployed in Q4 into the £50m share buyback programme announced
on 1August 2023
- A buy-in contract was entered into with an insurer in respect of the
Group’s defined benefit pension scheme on 28 November 2023, which
willremove future risk associated with funding of the scheme
- Proposed final dividend per share of 4.6p, up 21%, giving a total dividend
of6.9p (2.9 times cover)
- The Board’s expectations for 2024 are unchanged. Approximately 79%
(2022: 86%) of expected 2024 revenue is covered by the order book, with
unprecedented cover in Countermeasures & Energetics for 2025 and 2026
at 71% and 65% respectively of expected revenue.
* References to underlying operating profit and earnings per share throughout this
strategic report are to underlying measures from continuing operations; seenote 3
for a reconciliation to the statutory profit after tax from both continuing and discontinued
operations of £5.4m (2022: £47.4m) and see note 5 for a reconciliation of the reported
comparative values to the comparative values that have been re-presented on the
basis of the classification of operations as discontinued. For references toconstant
currency equivalents of reported numbers please refer to page 63 forfurther explanation.
2023
2022
2021
£756m
£551m
£431m
2023
2022
2021
£215m
£195m
£176m
2023
2022
2021
£541m
£356m
£255m
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 01

WHAT WE DO
INNOVATION AND TECHNOLOGY
ISAT OUR CORE
We achieve this by innovating at every stage of the value chain, from research
and development (“R&D”), through to design, manufacture and in-service
support for our intelligence and advance technology detection systems,
countermeasures, precision engineered devices and specialist materials.
Our customer base spans national defence organisations, security and law
enforcement agencies, as well as commercial markets such as space and
transport. We support our customers in more than 50 countries across
theglobe.
At Chemring we create market-leading technology
solutions and develop world-class thinking to solve
the most challenging problems.
Using our extensive science and engineering
expertise, we turn ideas into reality, designing and
developing critical solutions that protect and
safeguard in an uncertain world.
WHERE WE OPERATE
Our home markets of the UK, US, Australia and
Norway have asubstantial and enduring commitment
to defence and national security. We also export our
technology solutions to additional markets. The
percentages represent the proportion of sales for
that destination in the year ended 31 October 2023.
EUROPE
15%
In Europe, our Norwegian business
is experiencing ever-greater demand
for its niche specialist materials as
customers seek to strengthen their
defence capabilities in response to
the increased security threat from
Russia and China.
UK
43%
In the UK we are well positioned to
benefit from the increased demand
for intelligence and cyber-security
solutions signalled by the Integrated
Review and its recent Refresh. We
are also seeing accelerated demand
for our specialist energetic capabilities
resulting from the conflict in Ukraine.
ASIA PACIFIC
4%
Regional instabilities, capability upgrades and technology advancements
are driving increased spend in the Asia Pacific region. Our Australian
business positions us to contribute towards meeting the defence
requirements of Australia and other countries in the region.
US
38%
The US remains the single largest defence market in the world and
continues to be our principal home market. Our position in the market
isunderpinned by a Special Security Agreement (“SSA”) that enables us
tobe a supplier on important and sensitive programmes to US customers.
The continuous support for defence spending in the US provides us with
good visibility for future earnings as we respond to customers’
modernisation priorities.
Chemring Group PLC Annual report and accounts 202302

CHEMRING IS ORGANISED INTO TWO STRATEGIC SECTORS
SENSORS & INFORMATION
Innovation is core to solving our clients’ difficult problems.
With over 1,000 scientists, engineers and consultants, our Sensors & Information
sector continues to invest in technologies that safeguard and protect in an
uncertain world.
Operating across defence, national security, law enforcement and industrial
domains, we enable our clients to deliver competitive advantage, defend their
people, assets and information, and defeat their adversaries.
Our sensor technologies detect threats with a very high degree of confidence,
be they explosive, biological, radio or cyber.
Our Roke business draws on a 60-year heritage of innovation in sensors,
communications, cyber and artificial intelligence to innovate and apply these
technologies in new ways.
We operate across the whole lifecycle providing advice, research and
development, engineering, design and in-service support for our products
andservices.
COUNTERMEASURES & ENERGETICS
Chemring is the world leader in the design, development and manufacture
ofadvanced expendable countermeasures for protecting air and sea
platforms against the growing threat of guided missiles.
We combine a deep understanding of platform signatures, missile seekers
andchemical formulations to develop new countermeasures to defeat
evolving threats.
Our niche, world-class energetics portfolio produces high-reliability,
single-use devices that perform critical functions for the space, aerospace,
defence and industrial markets. We also manufacture specialist materials
including propellant and energetic materials that are used in a wide variety
ofapplications in the defence and civil markets.
Every day, our energetic products, services and experts assist customers,
including NASA and SpaceX, to achieve mission success. This ranges from
cutting-edge technology to enable our customers to launch rockets and
satellites into orbit, to the provision of aircraft safety systems including oxygen
mask deployment on commercial aircraft and ejector seats for aircrew egress.
REVENUE
£187.0m
(2022: £120.5m)
UNDERLYING OPERATING PROFIT
£34.2m
(2022: £25.4m)
REVENUE
£285.6m
(2022: £280.5m)
UNDERLYING OPERATING PROFIT
£50.5m
(2022: £48.9m)
2023
2022
2021
£34.2m
£25.4m
£23.3m
2023
2022
2021
£50.5m
£48.9m
£40.0m
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 03

SUSTAINABILITY OVERVIEW
COMMITTED TO
A SUSTAINABLEFUTURE
HEALTH AND SAFETY
PEOPLE
MAKING THE WORLD A BETTER PLACE
APPROACH
The long-term success of Chemring
can only be enhanced by a positive
interaction with all of our stakeholders.
An engaged and constructive approach
is therefore important to us. We
regularly collect feedback from our
key stakeholders to better understand
those issues that are of material
importance to them. Our approach
is therefore currently focused on the
following key topics and associated
areas of focus.
FOCUS
- Control of major accident hazards
- Injury prevention
- HSE risk management
- Occupational and process safety
ESG HIGHLIGHTS
- Total recordable injury frequency rate
increased slightly to 0.90 (2022: 0.78) but
still below our annual limit of 1
- High-potential incidents: 12 (2022: 13)
- Zero injuries in connection with or arising
from energetic events
> READ MORE ON PAGES 42 TO 43
FOCUS
- Culture
- Diversity and inclusion
- Employee wellbeing and engagement
- Employee learning and development
ESG HIGHLIGHTS
- Employee engagement remains a high
priority with positivity score up at 76% in
FY23 (2022: 75%)
- Board diversity improved further to
44%/56% female to male gender split
(2022: 38%/62%)
> READ MORE ON PAGES 56 TO 60
PURPOSE
Chemring helps make the world a
safer place. Across physical and
digital environments, our exceptional
teams deliver innovative technologies
and products that detect and defeat
ever-changing threats.
VISION
To be our customers’ preferred
supplier operating in niche markets
with high barriers to entry and
where we enjoy sole source, or
market-leading, positions.
> DISCOVER MORE ABOUT SUSTAINABILITY AT
CHEMRING.COM/SUSTAINABILITY/COMMITTED-TO-A-
SUSTAINABLE-FUTURE
At Chemring we acknowledge and embrace our collective responsibility to
contribute to a sustainable future. We have a strong and recognised obligation
to ensure the responsible operation of our business and are fully committed
to long-term sustainable value creation through safe, sustainable and ethical
business conduct at all times. Our goal is to ensure that we protect our planet
and our people, that we support our customers and their critical needs, and
that we have a positive impact on the communities in which we operate.
Improving our sustainability performance plays a key role in the way in
whichwe run our business today and plan for the future as we manage our
environmental, social and governance (“ESG”)-related risks. Our sustainability
goals are directly linked to targets for remuneration and reward across all our
leadership teams.
We also recognise that our ESG credentials are an increasingly important
factor in our ability to attract and retain first-class people. Engaged, motivated,
empowered and appropriately skilled employees are integral to our success as
we build a sustainable company of which all our stakeholders can be proud.
Chemring Group PLC Annual report and accounts 202304

ENVIRONMENT
ETHICS AND BUSINESS CONDUCT
FOCUS
- Emissions reduction
- Waste generation and hazardous
materialsmanagement
- Energy usage
- Water consumption
ESG HIGHLIGHTS
- Scope 1 and scope 2 market-based GHG
emissions reduced by 9.1% (2022: 7.3%)
onhigher revenue
- Water consumption decreased by 3.9%
- Waste decreased by 31.2% across
thebusiness
> READ MORE ON PAGES 44 TO 45
FOCUS
- Operational Framework and Code of Conduct
- Compliance oversight and risk management
- Whistleblowing
- Anti-bribery and corruption
ESG HIGHLIGHTS
- Code of Conduct training issued
toemployees
- Ethics & Compliance Committee
consolidated into the ESG Committee
> READ MORE ON PAGES 61 TO 62
“ Our commitment to
protection goes beyond our
customers and immediate
stakeholders; itincludes our
planet and broader society
and is underpinned by our
values and behaviours.”
Michael Ord
Group Chief Executive
OUR VALUES
SAFETY
We place safety at the heart
of everything we do
EXCELLENCE
We are focused on ensuring we
consistently meet high standards in
all thatwe do
INNOVATION
We create world-class solutions and
develop world-class thinking
* The use by Chemring Group PLC of any MSCI ESG research LLC or its affiliates (“MSCI”) data, and the use of MSCI logos, trademarks, service marks or index names herein, do
notconstitute a sponsorship, endorsement, recommendation, or promotion of Chemring Group PLC by MSCI. MSCI services and data are the property of MSCI or its information
providers, and are provided ‘as-is’ and without guarantee. MSCI names and logos are trademarks or service marks of MSCI.
As of 2022, Chemring Group PLC
received an MSCI ESG Rating of AAA*.
PROGRESS IN 2023
Chemring’s purpose is to help make the world a safer place. The ongoing war
in Ukraine has tragically highlighted the critical role that the defence and
security industry plays in preserving peace, democracy and freedom in the
western world. It has reinforced the argument that for sustainability to thrive,
it requires global stability at its foundations. We are proud of the role that
Chemring plays in providing that stability and are equally focused on ensuring
that we manage and progress our own sustainability agenda, and in particular
our ESG-related risks.
> READ MORE ON PAGES 38 TO 62
It has been another busy year in which we have built on the good progress
made during FY22.
Our ESG strategy over the current and future years will seek to identify those
areas where our activities can have most impact. Plans are now in place to
continue this journey and to ensure that we meet the growing disclosure
requirements of our stakeholders and demonstrate our ability to successfully
address ESG-related issues.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 05

OUR PURPOSE IN ACTION
WE’RE CONTINUING TO PROTECT
AND GROW BY LIVING OUR VALUES
Innovating to protect lies at the coreofour
foundations, underpinned by our values of Safety,
Excellence andInnovation. Every day, our people play
an essential role in protecting armed forces, national
security and commercial operations in sovereign
states across the globe.
SAFETY
LAUNCH OF OUR FUNDAMENTAL SAFETY PRINCIPLES
Across Chemring, we are on a Journey to Zero Harm, with safety
firmly at the heart of everything we do. Our People, Processes and
Plant need to work together to create a consistent safety culture and
safe working environment across Chemring.
That’s why this year, we’ve launched the Chemring Fundamental
SafetyPrinciples. These are the expectations of us as employees and
Chemring as a business to keep us all safe. So, what are the safety
principles, and what do they mean here at Chemring?
The Fundamental Safety Principles are all about clarity. Any organisation
should provide safe plant and safe processes so that when people are
working, the plant is fit for purpose and designed appropriately, and
the processes help identify the hazards, risks and precautions to take.
The people element, therefore, is what all of us need to understand.
We need to know the risks around us that could cause harm and what
the precautions are that have been put in place. Those precautions
could be personal precautions, such as PPE, or precautions built into
the assets, plant or equipment underpinned by our processes.
To help launch the Principles, every single employee in Chemring
completed training on these Principles and learnt how to activate the
SWIM approach when something is not right. SWIM stands for:
- Stop – what you are doing
- Warn – coworkers in the area
- Inform – relevant stakeholders
- Manage – the situation using the update condition procedure
The Fundamental Safety Principles aren’t just about stopping accidents
that could happen today. They’re also about embedding the learning
for the future generations coming through our businesses.
Chemring Group PLC Annual report and accounts 202306

INNOVATION
EXPLORING THE FINAL FRONTIER
One of the most exciting areas in which Chemring Energetic Devices
(“CED”) serves its commercial and government customers is Space
– otherwise known as the Final Frontier.
NASA’s Artemis programme is a series of missions that include
returning humans to the moon, a crewed mission to Mars, and
thereafter potentially beyond. Prime Contractors on these
programmes include Lockheed Martin, Aerojet Rocketdyne, Boeing,
and Northrop Grumman. The Artemis I uncrewed flight test of the
Space Launch System (SLS) rocket and the Orion spacecraft around
the moon on 16 November 2022 was a huge success. Artemis II,
scheduled for November 2024, will be the first crewed flight test of
these systems.
ULA, a joint venture between Lockheed Martin and Boeing, is one
oftwo launch vehicle companies awarded a National Security Space
Launch Vulcan (NSSL) contract. The contract covers Phase 2 of the
NSSL programme, awarding it about 60% of the launching of US
military and intelligence satellites through to 2027.
Vulcan is ULA’s next-generation heavy-lift launch vehicle, expected to
launch in late 2023 and replace Atlas V. This launch vehicle will become
the main workhorse for NASA and other US government customers
and will also be contracted for commercial missions, like Amazon’s
Kuiper constellation.
Chemring’s US based subsidiary, Chemring Energetic Devices (CED),
issupplying critical elements of the Artemis and Vulcan missions and
isthrilled to be a part of such exciting programmes. These missions
will be active for years to come and are expected to contribute
significantly to our understanding of space and pushing the limits of
where humanity can go. CED has successfully and consistently provided
mission critical devices to Delta IV, Atlas V, Mars 2020, and many other
missions and hopes to continue to do the same for SLS, Orion, Vulcan,
and more in the years to come.
EXCELLENCE
CHEMRING NOBEL HAS BEEN RECOGNISED AS ONE OF
THE TOP SUPPLIERS IN THE NORTHROP GRUMMAN
CORPORATION’S GLOBAL NETWORK OF MORE THAN
10,000 SUPPLIERS
Northrop Grumman is a leading global aerospace and defence
technology company. Chemring Nobel was one of 60 partners
awarded with a Supplier Excellence Award by Northrop Grumman
Corporation during the year.
Said Matt Bromberg, Corporate Vice President, Global Operations
Northrop Grumman, “The performance of Chemring Nobel set it
apart as one of the best of the best supplier partners. The expertise
and partnership of our supplier teams across the globe demonstrates
that together, we are well positioned to meet our customers’ most
complex mission needs.”
Said Helge Husby, Managing Director of Chemring Nobel. “At Chemring
Nobel, we pride ourselves on being a responsible and reliable partner
with a focus on safety, innovation, and customer service. This award is
evidence of our true partnership approach and our aim to consistently
meet high standards in all that wedo.”
OUR PURPOSE IN ACTION
WE’RE CONTINUING TO PROTECT
AND GROW BY LIVING OUR VALUES
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 07
©
NASA/MSFC

INTRODUCTION
The past year has again been marked by heightened unrest and geopolitical
tensions, from the wars in Ukraine and Gaza to food, energy security and
labour shortages, to the ever-present risk of cyber-attack. All of this has
reinforced the need for a robust defence and security industry which is crucial
to the maintenance of peace and global stability, the bedrock of sustainability.
Against that background, it has been a year of significant activity across the
Group as we have adapted to our customers’ changing spending priorities.
The need for countries to re-equip and modernise their defence capabilities,
which I highlighted last year, has resulted in increased budgets and a greater
sense of urgency in the face of increased global competition. This has created
significant opportunities for the Group as our customers look to restore and
enhance their defence capabilities. Increasing demand for our technology-driven
solutions, and a resurgent demand for more traditional defence capabilities
resulted in record order intake and an order book at year end at its highest
level for over a decade. None of this would be possible without the commitment
and dedication of our people and on behalf of the Board I wish to acknowledge
and thank them for their professionalism and support.
The outlook for the global defence market is increasingly positive, with strong
growth predicted over the next decade. Growing visibility and the increasing
desire of our customers to move to long-term partnering agreements give us
the confidence to continue to invest in our future capacity and capabilities.
We believe in nurturing talent, fostering innovation, and continually upgrading
our infrastructure. In doing so we strengthen our ability to deliver world-class
solutions and reinforce our position as a trusted partner in safeguarding
global security.
STRATEGY
The Group’s strategy is to deliver sustainable, profitable growth by operating
in niche markets with high barriers to entry, and where we enjoy market-leading,
technology-differentiated positions.
Our continued investment to develop intellectual property in priority, growing
areas of the defence and security market has supported us in establishing deep
long-term customer relationships, often acting as a sole source supplier.
The Sensors & Information sector is a key area of focus for Chemring, with
our customers increasingly seeking advanced technology solutions to address
their threats and challenges. We will continue to expand our product, service
and capability offerings to develop innovative solutions to support them with
achieving mission success in protecting their people, assets and data.
> READ MORE ON PAGES 26 TO 29
The Countermeasures & Energetics sector strategy is operationally driven,
and we are investing to strengthen and grow our focused, world-leading
positions. Russia’s invasion of Ukraine in February 2022 has driven unprecedented
levels of demand for our specialist energetic capabilities, and we are investing
to modernise and expand our manufacturing capacity to respond to our
customers’ needs. In Countermeasures we will continue the process of
modernisation and automation across our sites, sharing technology and
manufacturing excellence across the Group where possible.
> READ MORE ON PAGES 30 AND 33
In recent years Chemring has been focused on building a stronger, higher quality
and more resilient business. In doing so, it has built a strong and deployable
balance sheet which has provided the Group with increased optionality. Our
disciplined approach to capital allocation prioritises organic and inorganic
investment, a growing and sustainable dividend, other returns to shareholders
and a prudent approach to leverage. Favourable market conditions for our
niche Energetics businesses underpinned the Group’s strategic decision to
approve a 3 year £120m investment to increase capacity by £85m per annum.
In August 2023 we announced the launch of a share buyback programme of
up to £50m. This provides us with additional flexibility to deliver value for our
shareholders and maintain our commitment to balance near-term performance
with longer-term growth and value creation.
As a Board we will continue to to assess strategically aligned, accretive
acquisitions that can accelerate our growth strategy, and for opportunities to
leverage our capabilities into adjacent markets. Beyond enhancing shareholder
value and complementing our broader growth plans, we have a well-defined
set of criteria that any target must meet. So far, our recent acquisition activity
has supplemented our Roke business; however, we are continuing to explore
inorganic growth opportunities in the US space and missiles sector. Both
these areas offer significant prospects for long-term growth and are aligned
to the Group’s high technology competencies.
Beyond this we will continue to focus on developing a safe, sustainable, and
resilient business that is able to deliver progression through continuous improvement
in operational performance and execution. We shall continue to invest in both
our people and our infrastructure to deliver further growth into the future.
HEALTH, SAFETY AND THE ENVIRONMENT
At Chemring our goal is zero harm. This goes beyond the management of
safety and recognises that we have a duty to ensure that we take appropriate
actions to minimise the impact of our operations on many different levels,
from employee health, safety and wellbeing to climate change.
The Board recognises that the highest levels of safety are required to protect
employees, product users and the general public. The Board believes that all
incidents and injuries are preventable, and that all employees have the right to
expect to return home safely at the end of every working day. Safety therefore
remains one of the core values within Chemring and is central to our operating
philosophy. A key part of our health, safety and environmental (“HSE”) strategy
is the collation and analysis of data at every level to focus on the underlying
causes of incidents and the impact on our operations. This facilitates appropriate
decision making at all levels of our organisation.
Whilst consolidating in a calculative safety culture, we have continued with the
deployment of our Asset Integrity Management Maintenance Systems and
CHAIRMAN’S STATEMENT
DELIVERING CONTINUED PROGRESS
Carl-Peter Forster
Chairman
“ This has been another year of strong
performance across the Group. Growing
demand for both our technology-driven
solutions and a resurgent demand for
traditional defence capabilities have resulted
inrecord order intake during the year. As we
adapt to an increasingly volatile and unstable
world, the critical role that Chemring plays
insupport of our customers has never been
more important.”
Chemring Group PLC Annual report and accounts 202308

ESD Protocols. Towards the end of 2023 we focused on the “people” element
of our strategy by introducing the Fundamental Safety Principles with significant
focus on every employee’s duty to Stop, Warn, Inform, Manage (“SWIM”).
These themes will remain our priority throughout 2024 and beyond.
In addition, we will be introducing a new environmental data platform in 2024,
to better assess the environmental impacts of our operations and performance
against the targets that were set in 2022 in support of our wider ESG commitment.
Improving our sustainability performance plays a key role in the way we both
run our businesses today, and plan for the future. Further details on this can
be found in the sustainability section of this report.
PEOPLE AND OUR COMMUNITY
Our people are our greatest asset and it is through them that we are able to
meet our business and customer commitments. Our continued investment in
our employees ensures we are both growing and developing the workforce
we need to deliver our strategic objectives, further strengthening our organisation.
At the heart of our focus on people is the need to ensure that we have the
right culture for all employees to thrive. We strive to create an environment
where all employees are able to perform to the best of their abilities, through
strong engagement, transparent communications and great leadership at all
levels. Our values of Safety, Excellence and Innovation remain relevant to our
strategy and are the bedrock of this culture.
Underpinning all of this is an unrelenting focus on the diversity, equity and
inclusion (“DE&I”) agenda. We are fully committed to improving the diversity
of our organisation and creating an inclusive environment for all. Our shared
focus across the Group is to improve the female to male gender split within
all senior management roles to at least 33%/67% by 2027. I’m pleased to
report that our efforts to date have already improved our gender split for 2023
to 32%/68%. With the appointment of Alpna Amar as a non-executive director
in June 2023, it is also pleasing to report that the female to male gender split
on our Board of directors has improved further to 44%/56%.
To be truly inclusive, we need to listen to all our employees. In addition toour
standard processes such as the Employee Voice real-time sentiment tracking
tool and local business Employee Resource Groups, the Board is actively involved
in meeting directly with our employees. Laurie Bowen, our non-executive
director and Chair of the Remuneration Committee, continues to be responsible
for employee engagement on behalf of the Board. For the third year running,
Laurie has met with employees from across our organisation, with a specific
focus this year on our businesses with a strong growth agenda. Laurie met
with employees in Roke in England and Chemring Energetics UK in Scotland,
as well as our Norwegian employees at Chemring Nobel. In all three businesses
she was able to hear about both the challenges and the opportunities that
come with strong growth, and was particularly pleased to hear of their pride
in their business performance and in seeing investments being made in plant,
systems and infrastructure. These insights have again given each leadership
team and the Board further information to take action on.
> READ MORE ON THE PEOPLE AGENDA ON PAGES 56 TO 60
DIVIDENDS
The Board continues to recognise that dividends are an important component of
total shareholder returns. The Board’s objective is for a growing and sustainable
dividend and to continue to target a medium-term dividend cover of c.2.5 times
underlying EPS, subject inter alia to maintaining astrong financial position.
The Board is recommending a final dividend in respect of the year ended
31October 2023 of 4.6p (2022: 3.8p) per ordinary share. With the interim
dividend of 2.3p per share (2022: 1.9p), this results in a total dividend of 6.9p
(2022: 5.7p) per share, an increase of 21% on the prior year. If approved, the
final dividend will be paid on 12 April 2024 to shareholders on the register on
22 March 2024. In accordance with accounting standards, this final dividend
has not been recorded as a liability as at 31 October 2023.
BOARD OF DIRECTORS
On 23 January 2023, the Group announced that, after six years as Chief
Financial Officer and a director of the Company, Andrew Lewis had informed
the Board of his intention to retire following the completion of his 12-month
notice period. A process to find a successor was immediately launched.
On 24 May 2023, the Group announced the appointment of James Mortensen
as Chief Financial Officer. He has held various senior roles at Smiths Group
PLC, the FTSE 100 diversified engineering business, including having been
Chief Financial Officer of the Smiths Medical division. James joined the Group
on 1 November 2023 and, following a handover period and the publication of
the Group’s results for the year ended 31 October 2023, will take up his role
on 1 January 2024. At this point Andrew Lewis will step down from the
Board. He will leave Chemring on 19 January 2024. The Board thanks Andrew
for his contribution to Chemring’s success and wishes him every success in
the future.
On 13 June 2023, the Group announced the appointment of Alpna Amar as
anon-executive director, joining the Board with immediate effect. A qualified
Chartered Accountant, Alpna has over 22 years of corporate, operational and
commercial finance, strategy, M&A and investor relations experience in both
corporate and consulting positions. She is currently the Corporate Development
Director at Kier Group plc and prior to this she held senior investor relations
and corporate development roles at global automotive suppliers, TI Fluid Systems
plc and International Automotive Components Group SA. Upon joining the
Board, Alpna became a member of the Audit and Nomination Committees.
CURRENT TRADING AND OUTLOOK
Trading since the start of the current financial year has been in line with
expectations. The Board’s expectations for the Group’s 2024 performance
are unchanged. The Group order book as at 31 October 2023 was £922m,
of which £403m is currently expected to be recognised as revenue in 2024,
giving 79% order cover, which provides excellent visibility for the full year.
This leaves £519m of the order book to be delivered in FY25 and beyond,
which provides approximately 71% of 2025 and 65% of 2026 expected
revenue cover in Countermeasures & Energetics.
With market-leading innovative technologies and services that are critical to
our customers, together with the flexibility provided by the Group’s strong
balance sheet, the Board is confident that Chemring will continue to deliver
both organic and inorganic growth, balancing near-term performance with
long-term value creation. Chemring’s longer-term prospects remain strong.
Carl-Peter Forster
Chairman
12 December 2023
GOVERNANCE AND ETHICS
In recent years significant effort has been placed on strengthening the
governance and ethics across the Group, ensuring that we have the
necessary policies and procedures in place to enable the business to
operate with integrity and transparency, and to the highest ethical standards.
Chemring remains committed to conducting its business in an ethical and
responsible manner at all times, and in full compliance with all applicable
laws and regulations. We will continue to strengthen our policies and
procedures to ensure that the Group’s governance remains fit for purpose.
The bedrock of our governance is our Code of Conduct and our Operational
Framework, both of which bind our purpose, values, behaviour, policies and
procedures, and provide the necessary governance to enable us to operate
in a safe, consistent and accountable way. Our ESG Committee, which
meets regularly throughout the year and is chaired by the Chief Executive,
isresponsible for the oversight and monitoring of Chemring’s governance
framework and ethical business conduct and compliance.
> FURTHER DETAILS ON THE COMMITTEE’S ACTIVITIES DURING
THE YEAR CAN BE FOUND ON PAGE 84 OF THIS REPORT
Good governance and ethical behaviour underpin our evolving sustainability
agenda and ensure that we operate safely, responsibly and in compliance
with applicable legislation in all of the jurisdictions in which we operate.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 09

WELL POSITIONED IN NICHESEGMENTS MAJOR INTERNATIONAL PROGRAMMES
STRONG GROWTH IN ROKE’S NATIONAL SECURITY
ANDDEFENCE MARKETS
Against the background of growing defence budgets, particularly in the US
and Europe, Chemring is well positioned in niche segments of the defence
market which, over time, have the opportunity to outperform the broader sector.
These include the Group’s global market-leading positions on airborne and
naval countermeasures, advanced sensors, Electronic Warfare and software
engineering. We are also well placed to benefit from resurgent demand for
more traditional defence capabilities, including in the space and missiles markets
where we are a key supplier of energetic materials and mission-critical
specialist devices.
The Group’s record order book provides good medium-term visibility. A significant
proportion of our revenue is generated from sole or dual source positions,
often from long-term partnering agreements. Market-leading positions, incumbent
supplier status and high barriers to entry position Chemring well for the future.
Chemring is exposed to a substantial pipeline of major international
programmes that have the potential to deliver strong long-term growth.
These include being a qualified source for the F-35 Joint Strike Fighter
countermeasure programme and having technologies and products to
address the next-generation US space, missile and biological agent detection
programmes – increasingly relevant in a post-pandemic world.
As Cyber and Electromagnetic Activity (“CEMA”) becomes increasingly
important in today’s threat environment, and as a consequence of Russia’s
invasion of Ukraine, there are a growing number of opportunities for our
battlefield systems integration and Electronic Warfare products in the
international market.
We are seeing growing customer enquiries for Roke’s suite of world-leading
Electronic Warfare products and are supporting ongoing customer
demonstrations and field trials in the US to secure orders from this
potentially significant market.
Roke’s consulting, technology and R&D service activities are experiencing
strong growth, driven principally by ever-increasing demand for information
advantage solutions in the defence and national security markets.
The Group’s capabilities are well aligned to both the US and UK Government’s
emphasis on cyber, secure networks, artificial intelligence, data science, autonomy,
Open Source Intelligence (“OSINT”) and Electronic Warfare (“EW”). This
validates our Sensors & Information sector strategy, and should increase the
opportunity space for Roke to deploy its market-leading technologies.
Opportunities exist to expand and accelerate Roke’s capabilities and offerings,
both through acquisitions and exploiting opportunities in adjacent markets
and territories.
Our ambition is to grow Roke’s revenue to a minimum of £250m by 2028.
INVESTMENT CASE
INVESTING IN SUSTAINABLE
PERFORMANCE AND GROWTH
Chemring delivers profitable growth by operating
inmarkets where we have differentiators, such as
intellectual property, niche technology and high
barriers to entry.
We continually review our portfolio to ensure that we maintain sustainable
niche positions where technical and qualification barriers to entry enable
highmargins. These, along with strong and enduring customer relationships,
provide us with a strong platform for future growth. We will achieve our
growth by total commitment to our enduring purpose, which is to relentlessly
innovate to protect our customers.
Chemring Group PLC Annual report and accounts 202310

BALANCE SHEET STRENGTH COMMITTED TO A SUSTAINABLE FUTURE
MEDIUM-TERM FINANCIAL OBJECTIVES
Chemring has a robust balance sheet and strong ongoing operating cash
generation, providing a platform for future investment in the business, both
organic and inorganic, and sustainable, growing dividend payments. The focus
on building a strong and deployable balance sheet has provided increased
optionality and in August 2023 the Group announced a share buyback
programme of up to £50m providing additional flexibility to deliver value
forour shareholders.
At Chemring we firmly believe that stability is at the heart of sustainability
and that the defence industry has a critical role to play in making the world a
safer place, now and for future generations. We have set ambitious targets to
meet our ESG agenda and are improving our disclosure and performance
year on year.
- 15.7% reduction in scope 1 and market-based scope 2 emissions from our
FY21 baseline
- Waste production decreased by 31.2% versus 2022
- Board of directors now 44% female (2022: 38%)
- Senior leaders now 32% female (2022: 24%)
- Employee positivity 76% (2022: 75%)
- AAA ESG rating by MSCI, top 3% of the Aerospace and Defence sector
Since 2019 the Group has communicated certain medium-term financial
objectives, which have been rolled forward at each set of results. These included:
- Targeting a mid-teens return on sales in the medium term.
Underlying profit marginshave progressed from 10.1% in FY18 to 14.6%
in2023
- Improving cash flow. Across the last three years, underlying operating
cash conversion has been 101% of underlying EBITDA, demonstrating the
improvement inbusiness practices is permanent and sustainable
- Reducing indebtedness. Net debt has decreased from £81.8m in 2018
to£14.4m in 2023, while spending c.£184m on capex over the period
Chemring is focused on building a financially sustainable and robust Group.
These actions provide strong foundations for future growth.
> DISCOVER MORE ABOUT INVESTING AT
CHEMRING.COM/INVESTORS
ORDER BOOK – GROWTH OVER THE LAST FIVE YEARS (£m)
FY23
FY22
FY21
FY20
FY19
£922m
£651m
£501m
£476m
£449m
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 11

INTRODUCTION
Building on the strong foundations that we have put in place in recent years,
Iam pleased to report that 2023 has been another year of positive performance
across the Group.
Global uncertainty, fuelled by the war in Ukraine and increased competition
with China, continues to drive many of our customers to reassess spending
allocation. National defence and security, along with a greater focus on national,
including industrial, resilience are increasingly significant priorities. Demand for
our technology-driven solutions and a resurgent demand for traditional defence
capabilities have meant that the work we do in support of our customers and
their critical needs has never been more important. The commitment and
professionalism of our people this year has once again been outstanding and
Iam, as always, indebted to all my colleagues across Chemring.
The outlook for global defence markets is increasingly robust, with continued
growth expected over the next decade. This growing visibility gives us the
confidence to continue to invest for the future, balancing near-term performance
with longer-term growth and value creation. With a robust strategy and a
relentless focus on safety, operational excellence and growth, Chemring is
well placed to capitalise on its many opportunities.
2023 PERFORMANCE
It is pleasing to report a strong set of results for the financial year despite
thechallenges associated with the heavier weighting of performance to the
second half of the year, caused by the delays to order intake in 2022 following
the extended US Continuing Resolution.
Revenue was up 18% to £472.6m (2022: £401.0m), underlying operating
profit was up 16% to £69.2m (2022: £59.4m) and underlying profit before tax
was up 17% to £67.9m (2022: £57.9m). Underlying diluted earnings per share
was up 8% to 20.0p (2022: 18.5p).
The underlying operating profit of £69.2m (2022:£59.4m) resulted in an
underlying operating margin of 14.6% (2022: 14.8%), achieving the mid-teens
Group margin objective that we set out in early 2019. The flat margin primarily
reflects the increase in higher margin energetics revenue in Countermeasures
& Energetics offset by the operating expense investment inRoke Academy,
Roke Futures and Roke USA, together with the higher margin-dilutive
“pass-through” revenue at Roke.
In the UK, the markets for EW, cyber and data science capabilities, in which
Roke is a leading participant, have remained extremely buoyant in the period.
Roke has again delivered double-digit growth in revenue and has maintained
strong margins despite increased investment in people, infrastructure and
product development.
Roke’s order intake during the year was up 9% to £183m (2022: £168m)
withrevenue for the year exceeding £160m for the first time.
GROUP CHIEF EXECUTIVE’S REVIEW
CREATING SUSTAINABLE VALUE AND
OPPORTUNITY FOR ALL OUR STAKEHOLDERS
Michael Ord
Group Chief Executive
“ This has been a year of heightened activity
and progress across the Group as we have
reacted to growing demand for our products
and services, both technology-driven solutions
and a resurgent demand for traditional
defence capabilities. Changing customer
spending priorities in the face of increased
global uncertainty and competition have
resulted inthe order book being at its highest
level inover a decade, giving us a strong and
sustainable platform for future growth.”
A key element of the UK’s Integrated Review Refresh 2023 of Defence,
Security and Foreign Policy (“IRR 23”) was the need to upgrade statecraft
forsystemic competition. This is driving demand for Roke’s national security
capabilities, particularly in active cyber defence and technological mission
support services to core government customers.
In September 2023 Roke received a significant contract award valued at
£40mto deliver the next two years of Project ZODIAC for the UK Ministry
of Defence. ZODIAC is the backbone of the British Army’s Land ISTAR
Programme, and will deliver an integrated intelligence, surveillance, target
acquisition, and reconnaissance (“ISTAR”) system, which will transform how
the Army undertakes data-led decision making in the land environment to
gain operational advantage. Roke will act as the Prime Systems Integrator on
this advanced technology programme supported by a supply chain of some
ofthe world’s leading technology companies.
Roke Futures, which services the needs of public and private sector customers
and sits alongside the National Security and Defence business units, has also
made strong progress in scaling its business activities throughout 2023, gaining
traction with customers including Rolls-Royce, Waygate Technologies,
Vodafone and a FTSE 100 multinational mining company.
In the last five years successful execution of its strategy has seen Roke more
than double in size. Its headcount has increased from c.400 at the end of
2018 to over 1,000 today, driven in part by the success of its graduate and
apprenticeship schemes, and the continued success of the Roke Academy.
The continued investment in the development of its people is a key enabler
topositioning Roke well to deliver on its future growth ambitions.
The strategic goal for Roke is to continue to focus on growth across all its
business areas in the UK, and to leverage international markets, especially the
US, to give Roke a wider international presence. We also continue to explore
further inorganic growth opportunities and have a robust pipeline of future
acquisition candidates.
Roke USA continues to make good progress as it seeks to capitalise on
opportunities with the US DoD customer. Highly successful demonstrations
of our Resolve and Perceive man portable systems have generated DoD
interest in Roke USA developing a system that utilises Roke UK’s sophisticated
mission analysis software, but which specifically targets the US DoD requirement
set. A number of large customer-funded Electronic Warfare development
programmes have been initiated and in addition to EW hardware, Roke USA
has now established a presence providing research anddevelopment services
focused on advanced EW algorithms.
Also in the US, our US Sensors business continued its transition away from
explosive hazard detection to focus on building winning solutions to convert
current US Programs of Record into low rate and full rate production, and
onexploiting a growing opportunity in bio-security and surveillance. In a
Chemring Group PLC Annual report and accounts 202312

post-pandemic and contested world, governments are becoming increasingly
concerned by the risks of both naturally occurring and engineered biological threats.
In August 2023 our US Sensors business was informed that the Milestone C
procurement decision in respect of the Joint Biological Tactical Detection
System (“JBTDS”) program had been approved and in September 2023 the
business received a Low Rate Initial Production (“LRIP”) contract, valued at
US$15m. Hardware deliveries under this contract will be made over the next
10 to 14 months, with a Full Rate Production (“FRP”) contract expected to
be awarded thereafter.
Deliveries under the FRP phase of the Enhanced Maritime Biological Detection
System (“EMBD”) program have continued as planned, in support of the US
Navy. We received a third option quantity exercised under the sole source
$99m Indefinite Delivery/Indefinite Quantity contract worth $15.3m, with
deliveries expected to be made through to 2024.
Chemring’s experience and expertise in fielding biological agent detectors
forits US DoD customers provide a strong platform from which to pursue
opportunities in existing and adjacent markets, such as homeland security.
Through a combination of customer and self-funded research and development
programmes we continue to design and test next-generation biological threat
sensors for detection, classification, and presumptive identification of aerosol
biological threats. Chemring is actively pursuing federal and industry
partnerships to bring these products to a broad range of markets.
Following the US DoD’s decision in 2022 to transition the Husky Mounted
Detection System Program of Record to sustainment earlier than anticipated,
Chemring has been able to evaluate the potential sustainment program and
determined that in the short to medium term there is insufficient US DoD
funding to make it economically viable for Chemring to continue to operate
the business. The decision was therefore taken to treat the explosive hazard
detection business as a discontinued operation in 2023, with a non-cash
impairment of the goodwill associated with its acquisition in 2009 and other
assets, totalling £31m, being recorded.
In 2018 Chemring announced that its US-based subsidiary, Chemring Sensors
& Electronic Systems (“CSES”) had been down-selected by the US DoD as
one of two contractors to be taken forward to the next phase of the competition
for the Aerosol & Vapor Chemical Agent Detector (“AVCAD”) program.
Given the competitive nature of this program Chemring did not include any
revenues associated with the AVCAD program in its forward guidance to
research analysts and the market.
Through 2022 our US Sensors business successfully progressed through the
Engineering & Manufacturing Development program phase but is now not
expected to progress to any subsequent program phases at this stage. Chemring
has therefore recognised an impairment of £15.6m in respect of the previously
capitalised development costs.
Whilst the news that we have not progressed on the AVCAD program was
clearly disappointing it must not overshadow the significant progress our US
Sensors business has made in US DoD biological agent detection programs.
The Group has moved quickly and decisively to reposition and reshape its US
Sensors business to ensure sustainable competitive advantage in its targeted
biological detection and security markets. The future focus for the Sensors &
Information sector continues to be on expanding the Group’s product, service
and capability offerings in the areas ofnational security, AI and machine learning,
tactical electronic warfare and information security, and securing/delivering
against the Group’s sole source positions on the US DoD biological Programs
of Record. We will continue toactively explore opportunities to expand and
accelerate the Sensors & Information sector capabilities and offerings, both
byleveraging opportunities in adjacent markets and through further
bolt-onacquisitions.
In 2023 the focus for our Countermeasures & Energetics sector was to
continue strengthening and protecting our niche, world-leading positions
bycontinuously improving our technological and operational base, and by
working closely with our customers in the development of new solutions
tomeet emerging needs.
Order intake in the year was considerably higher at £541m (2022: £356m),
driven by multi-year orders received across the sector.
In Countermeasures we have continued to see sustained customer demand
from across our portfolio, maintaining our position as the world leader in the
design, development and manufacture of advanced expendable countermeasures.
Order intake was £183m (2022: £220m), with notable contract awards including
$39m for the delivery of MJU-61 flares and $17m for the delivery of MJU-75
flares, both from our fully automated manufacturing facility in Tennessee in
support of the US DoD, and a £24m order for the delivery of a range of
countermeasure products in support of the UK MOD from our facility
nearSalisbury.
The investment in the expansion and automation of our Tennessee facility to
meet the expected demand for airborne countermeasures continued during
the year. Having completed construction work of the buildings in FY21 and
commissioning and characterisation in FY22, FY23 saw the completion of
firstarticle testing and the first delivery of units to the customer.
The Countermeasures sector saw a greater weighting of its trading
performance and cash generation to the second half of 2023 following the
delays to order intake in 2022 following the extended US Continuing Resolution.
In the Energetics sector we continue to see increased levels of activity and
demand in the propellants and energetic materials markets as customers
re‐evaluate their operational usage and stockpile requirements associated
with traditional defence capabilities. As a result, our three niche Energetics
businesses, which design and manufacture high precision engineered devices
and specialist materials, have seen strong customer demand with order intake
up 161% to £358m (2022: £137m). Notable contract awards included a £43m
order for the delivery of critical components used on the NLAW system
from our Scottish facility.
Our Norway-based subsidiary, Chemring Nobel, had a particularly strong
performance, finishing the year with a record order book which provides
significant visibility over the medium term. Over £40m of orders were won
inthe final month of the year, which included a £30m order to supply
Dyno-Nobel with a range of energetic materials over the next five years.
Chemring Nobel continues to work with other customers including Diehl
Defence, Rheinmetall, and Nammo on similar long-term contracting models.
CAPEX
- £120m Capex investment in our
Energetics businesses to capitalise
onunprecedented demand
- Delivering incremental revenue of
£85m and operating profit of £21m
per annum, full year effect from FY27
- Continual capex investment to
increase automation, enhance safety
and drive margin improvement
DIVIDENDS
- Key part of total shareholder return
- Targeting medium-term dividend
cover of c.2.5 times underlying EPS
- Dividends have grown 20% per
annum for the last 3 years
M&A
- Focus on incremental bolt-on
acquisitions that complement existing
capabilities and accelerate growth in
customer priority areas – in particular
Roke and US Space and Missiles –
while maintaining a disciplined
approach to our evaluation criteria
SHARE BUYBACK
- Low risk, high return on investment
option for excess cash which
creates value for long-term holders
- £9m deployed in 2023 with a
further £41m of capital allocated
to2024
CAPITAL ALLOCATION POLICY
£473m
£401m
REVENUE
+18%
2023
2022
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 13

GROUP CHIEF EXECUTIVE’S REVIEW continued
ROKE ACADEMY – NEXT-GENERATION TALENT
As the tech industry leads the way for innovation and continues to grow at an
incredible pace, it’s not surprising that countless people want to land jobs in this
exciting field. The question for many, especially those without coding experience
or working in entirely different fields, is how?
Roke has the answer in the form of its Roke Academy.
The Roke Academy is a centre of excellence for learning and development,
focusing on non-traditional areas of recruitment to embrace undiscovered talent
who may not have previously had the opportunity to enter the tech field.
Roke is looking for individuals interested in tech, programming, or software
development, who share a desire to learn and develop their love of technology.
Our cohorts come from various backgrounds, from recruitment and the arts to
funeral care and even a horse saddle maker! The common denominator is that all
our cohort members tend to do some level of coding in their spare time as a
hobby or personal interest.
We’re after inquisitive people with transferable skills, some of whom may have
faced barriers to work for various reasons, whether they have found the traditional
recruitment process challenging, are returning to work after a break, or are
transitioning from military service. We will support these diverse individuals who
can bring unique strengths to our business regarding creativity, data analysis and
innovation to progress in their chosen field.
Onaconstant currency basis, using the 2022 closing exchange rates,the order
book would be £965m. The increase since 31 October 2022 isattributable to
strong order intake at Roke and across the Countermeasures &Energetics sector.
This leaves £519m of the order book to be delivered in FY25 and beyond.
Atthis stage, this provides approximately 71% of 2025 and 65% of 2026
expected revenue cover in Countermeasures & Energetics.
Net debt at the year end was £14.4m (2022: £7.2m), the increase since
31October 2022 being largely attributable to strong operating cash generation
offset by the investment in capital projects in the year. Strong underlying operating
cash inflow of £80.0m (2022: £85.1m) represented 90% (2022: 110%) of
underlying EBITDA. Our three-year rolling average cash conversion has been
101% (2022: 108%), showing that the ongoing focus on working capital
improvements is delivering long-term, sustainable, positive results.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE (“ESG”)
From an ESG perspective, 2023 has seen us make further progress as we
proactively manage our sustainability agenda. Focus areas included health
andsafety, diversity and inclusion, reducing climate change, and employee
wellbeing. As a business we are committed to building a sustainable company
of which all our stakeholders can be proud, both now and in the future.
It is pleasing that our efforts have been recognised externally. In 2023 we
were again given a rating of AAA by MSCI, putting us in the top 3% of the
Aerospace and Defence sector. Furthermore, in June 2023 the Group was
identified by Investec’s Sustainable Investment Research as a 2023 rising star.
Its research identifies UK companies in the small and mid-cap market that are
demonstrating a growing commitment to ESG. It noted that Chemring has
the third most improved Bloomberg ESG score among all UK companies
below $5bn market capitalisation, with this improvement being mainly attributed
to better disclosure on social issues, where Chemring has gone from below
median in 2020 to leading its peer group.
HEALTH AND SAFETY
Safety is our core value, with the health, safety and wellbeing of our colleagues,
their families, our customers and the communities in which we operate being
our priority. The successful implementation of our HSE strategy continues, as
does our focus of achieving zero harm.
Our safety performance in terms of our total recordable injury frequency
(“TRIF”) rate was 0.90, which shows a slight increase when compared to last
year’s 0.78 but is still below our annual limit of 1. Most injuries were either
caused by slips, trips and falls, or were musculoskeletal in nature.
Our HSE strategy has focused on three core areas of activity:
CONTROL OF MAJOR ACCIDENT HAZARDS
Over the last four years, we have implemented a number of processes to
enhance our focus in this area by ensuring we design, maintain and operate
tothe highest standard. We continue to invest in modern processes and
technology to remove our employees from exposure to energetic hazards.
During the design of these processes we have placed more scrutiny on
theapplication of process hazard analysis. In 2019 we mandated that all
Countermeasures & Energetics businesses would need to conduct regular
reviews to identify the potential for major process safety events. This year
saw the continued iteration of that review process, with an increase in the
number of hazard scenarios being identified as the rigour of process hazard
analysis matured. As a result of this maturing process, we continue to develop
an understanding of our residual risks and throughout the year have taken
further steps to reduce these to a level as low as is reasonably practicable. To
help reduce our residual risks the implementation of a common computerised
maintenance management system continues to be rolled out across selected
businesses, improving management and accountability for safety-critical assets.
We continue to share best practice through the Technical Safety Committee,
Technical Learning Group and our quarterly “Shared Learning” events.
It should be noted that for the second year running there have been no
injuries associated with energetic events.
OUR PURPOSE IN ACTION
LINK TO STRATEGY
> READ MORE ON
PAGES 18 TO 19
LINK TO OUR VALUES
> READ MORE ON
PAGE 25
INNOVATION
1
2023 PERFORMANCE continued
In the US, our Chicago business received multiple orders in the period including
two contracts totalling $23m to supply critical components to Lockheed Martin,
and a $46m order to supply key parts on the United Launch Alliance (“ULA”)
Vulcan launch system, including flight-critical initiators, thrusters and cartridges.
Our Chicago business now has a record order book which is in excess of
$165m. Orders in the final month of the year alone exceeded any prior year
full year order intake.
The future focus of the Countermeasures & Energetics sector remains on
strengthening and protecting our niche, world-leading positions by investing
inour technology base and continuously improving and modernising our
operations, with a particular focus on safety and automation, and on
improving our competitiveness through investment in lean manufacturing
capabilities and developing new products and technologies. Simultaneously,
and as announced in June and November 2023, we are making significant
investments to expand the capacity of our focused Energetics businesses to
capture the unprecedented, and sustained, demand for our products that is
being driven by the increased threat environment. We are also seeing significant
opportunity through partnering with our customer base on future technology
advancements to develop new solutions to meet their emerging needs.
The Group’s order book at 31 October 2023 was £922m (2022: £651m),
ofwhich approximately £403m is scheduled for delivery during 2024, representing
cover of approximately 79% (2022: 86%) of expected 2024 revenue.
Chemring Group PLC Annual report and accounts 202314

INJURY REDUCTION
Injury prevention focuses on the reduction of injuries through the adoption of
safety as an inherent part of everything we do. This is enacted through safety
leadership, clear expectations, accountability and establishing a safety culture
that drives learning and improvement, not blame.
This year we aligned our corporate reporting platform to the three pillars of
our HSE strategy, People, Plant and Processes, to better understand the root
causes of our incidents and where to focus our levels of assurance. These
additional data points will help our continued focus on becoming a learning
organisation. This data has reconfirmed trends regarding musculoskeletal injuries
due to the manual handling nature of some of our processes, together with
cuts to fingers and hands. The relevant businesses continue to manage these
risks whilst considering further automation.
HSE RISK MANAGEMENT
Safe delivery of our business continues through the management of risk and
isbuilt around understanding our hazards, and establishing clear expectations
and consistency. Our HSE Management System Framework Standard puts our
HSE policy into practice by setting standards on nine core elements across
the Group to drive a robust and common approach to the management of
HSE. Each business within the Countermeasures & Energetics sector is audited
every year and the Sensors & Information sector every three years to ensure
compliance, with high-priority non-compliances being reported and monitored
at Executive Committee level. The changes made in 2022 to our Operational
Assurance Statement process continue to help the businesses focus on
compliance with the HSE Framework which in turn provides useful insights
when planning the Line of Defence 2 (“LOD2”) audits.
We measure our HSE performance to reflect both occupational and process
safety. In doing so we have several data points, one of which is an external
review of our prevailing safety culture. Last year we invited back a team of
experts to review our progress. The review highlighted good progress as we
journey towards becoming a high-reliability organisation. The review confirmed
our businesses as approaching a Group-wide calculative status, with robust
processes and systems generating data and signals around our high-hazard
operations. The level of collaboration has also increased, with many businesses
sharing best practice on a regular basis to help accelerate our performance,
all of which is supported by a positive tone from the top and underpinned by
risk-informed, visible, and proactive safety leadership. This year has seen a
focus on supporting the leadership through the introduction of the Leadership
Guide and the provision of training support.
ENVIRONMENT
In 2023 we made further progress on our journey to becoming net zero by
2030, achieving a 9.1% reduction in scope 1 and scope 2 market-based GHG
emissions (2022: 7.3%). A key challenge for the Group’s ESG Committee is to
manage our ESG-related risks – balancing both the near and longer-term
targets that were set in 2021 with the need to continually look for ways in
which we can improve further.
In addition to reporting in line with the Task Force on Climate-related Financial
Disclosures (“TCFD”), the Group has committed to further improve its
non-mandatory disclosure and completed its second CDP submission this
year. By translating the TCFD recommendations and pillars into actual disclosure
questions and a standardised annual format, CDP provides investors and
disclosers with a unique platform where the TCFD framework can be
brought into real-world practice in a comparable and consistent way.
As our disclosure increases, so has the need to ensure that the data that
wereport to the market is accurate. We have now put in place an auditable
framework for our emissions reduction activities, with external subject
matter experts appointed to verify the data and to report to the Group’s
Audit Committee. Next year we will be introducing a new environmental
data platform to better assess the environmental impacts of our operations.
CULTURE
We have ambitious goals in Chemring and it’s essential that we invest in our
workforce to achieve them. By having the right people in the right place at the
right time with the right skills, and working in a safe, healthy and inclusive
environment, we build our future success.
> DISCOVER MOREABOUT OURCULTURE AT
CHEMRING.COM/SUSTAINABILITY/PEOPLE
We continue to invest in nurturing a values-based culture. Safety, Excellence and
Innovation drives everything we do and is firmly embedded in every part of
our business. Our approach is that of a “Global Voice” that sets the standards
and expectations that we promote across the Group whilst the “Local Accent”
brings impact and relevance to each individual business, respecting that each
territory has its own unique cultural characteristics.
Our story in 2023 has been one of growth and opportunity, with muchof
the people agenda focused on how we can enable short-term performance
as well as drive longer-term value creation. Our talent management efforts,
resourcing strategies and development programmes have all matured in 2023
and are focused on helping to create the workforce we need both now and
inthe future.
It has also been a year in which innovative approaches have been takenin using
our technology to connect colleagues in ways where significant international
travel would have previously been required. OurAspire@Chemring programme,
designed to support the development of those colleagues identified as potential
candidates for senior roles in the future, had another extremely successful
year. A global cohort of 75 colleagues from across all of our businesses completed
3,500 learning hours over the 11-month programme. We partnered with three
top business schools (MIT, Tuck, and Columbia) to provide the cohort with
elective modules which best aligned with their individual development goals.
Byleveraging technologies to learn, collaborate and have shared experiences
on-line, we also significantly reduced the environmental footprint of a global
development programme, supporting our ESG commitment to reducing emissions.
Post-pandemic we have also seen a shift in our talent markets for employees
having a greater desire for a purpose driven career, not just from the generation
joining the workforce for the first time, but also for those with established
careers where employees took the opportunity to reassess their priorities
both during and after the pandemic. This has driven a need for us to consider
what is important to both current and future employees when choosing
Chemring for their career journey.
Our employee engagement efforts are focused largely on actively listening to
our colleagues to understand how we can support them to be successful at
Chemring. Whether it be Employee Voice, our on-line real-time sentiment
tool, Employee Resource Groups, or town hall style events - all employees
have the opportunity to share their thoughts and be listened to. Each business
uses these as opportunities toconsider changes and take action directly from
employee feedback.
Listening to our employees is also at the heart of our diversity, equity and inclusion
efforts. Our employees are helping us to identify where we can improve across
many aspects of the DE&I agenda, whether it is focused on gender, ethnicity,
neurodiversity or any other characteristic that makes up our workforce. We
see a diverse workforce as a key enabler for continuing to innovate our products
and services for our customers.
Whilst 2023 has been a successful year, we must continuously improve our
people practices and look forward to further supporting our workforce in
2024 and beyond.
CONCLUSION
I am delighted with the financial and operational progress that continues to
bemade across the Group as we continue to build a strong, high quality and
technology-focused business.
This has been another year of solid progress across the Group. We maintain
our relentless focus on living our shared values of Safety, Excellence and Innovation,
and in doing so we are driving our collective purpose: delivering innovative
protective technologies to help make the world a safer place. With market-leading
technologies and services that are critical to our customers, our niche market
positions and our strong balance sheet, I remain confident that we will
continue to grow in the future.
Michael Ord
Group Chief Executive
12 December 2023
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 15

The ongoing geopolitical turbulence has resulted in many countries
re-appraising their defence and national security priorities, including
increasing budgets, to specifically address the security challenges posed by
Russia and China. Against this heightened threat environment, the role of
multi-lateral organisations such as the North Atlantic Treaty Organization
(“NATO”) and the European Union (“EU”) is also becoming more significant.
The Russia-Ukraine conflict has specifically refocused attention on the broad
spectrum of defence capabilities relevant to a significant peer conflict. It has
also brought a renewed focus on modernisation and replacement of NATO
capabilities, including those being donated to assistUkraine.
China’s extensive military modernisation programme has, in many cases,
generated a requirement for increasingly cutting-edge solutions to protect
against a continuum of threats. These range from long-range hypersonic
missiles through to sub-threshold “grey-zone” activity, with the latter
involving the extensive use of digital-based threats such as cyber-attacks
and disinformation campaigns.
The Group’s diverse and niche capabilities make it well placed to support our
customers’ abilities to respond to this deteriorating security environment.
GLOBAL SALES
% of Chemring’s global sales (2019 – 2023)
TOTAL SPEND
US$877bn
Source: SIPRI
TOTAL SPEND
£57bn
Source: SIPRI
MARKET OVERVIEW
CHANGING MARKET DYNAMICS
Chemring is an international technology company, and we have a significant
organisational footprint inthe US, the UK, Europe and Australia.
UNITED STATES UNITED KINGDOM
OUR POSITION
Our US-based Energetics business has a strong and distinct position in the design,
development and manufacture of precision engineered devices for rapidly-growing niche
markets in aerospace and defence. Our US-based Countermeasures business is the market
leader in expendable infra-red (“IR”) pyrotechnic decoys that protect airborne and naval
assets from guided missiles.
In US Sensors, we are the largest provider of advanced biological sensors to the US
DoD. Our ground-penetrating radar, explosive hazard detection (“EHD”) system for
the Husky vehicle is now in sustainment and we have taken the decision that the EHD
business will not continue to operate. Our Roke USA business continues to drive a
campaign to leverage Roke’s UK attributes and bring disruptive land Electronic Warfare
(“EW”) capabilities to address the US’s mission-critical requirements through both
product and service channels.
MARKET TRENDS
The US continues to represent the largest individual defence market in the world, and at
US$842bn the US Presidential Defense Budget request for 2024 is the highest ever. This
strategy driven budget, reflecting US concerns over the Indo-Pacific threat environment
and the need to support Ukraine, also marks a record commitment to Research, Development,
Test, and Evaluation (“RDT&E”), with US$145bn earmarked for new technology investment.
OUR CHALLENGES AND OPPORTUNITIES
The US’s focus on bolstering its defence and national security technology base to fulfil
defence needs can create opportunities for us to deploy Group-wide capabilities and
technologies in customer priority areas. These include launch systems, hypersonics,
EW,sensors, biotechnology, artificial intelligence (“AI”), cyber and quantum computing.
Demand for the advanced F-35 Lightning II military jet continues to be strong, and our
contribution to this core air platform’s countermeasures suite confirms our leadership
position in this capability area.
LINK TO STRATEGY
> READ MORE ON PAGES 18 TO 19
OUR POSITION
In the UK, our Roke business unit is exploiting its highly relevant, full lifecycle capabilities
in cyber-security, GEOspatial INTelligence (“GEOINT”), sensors, communications, land
Electronic Warfare (“EW”), Artificial Intelligence (“AI”) and machine learning for the
continued benefit of national security and defence customers. Private and public sector
organisations are also increasingly seeking to utilise Roke’s experience in intelligent,
data-driven, digital solutions to enhance their own operational effectiveness.
Our UK Energetics business is the sole source supplier for multiple land, air and naval
propellants and pyro-mechanical devices, and has critical, through-life programme
positions on several high-demand systems. Similarly, our UK Countermeasures business
continues to retain its international leadership position in protecting air and naval forces
from guided missiles threats, through the design, development, and supply of radio
frequency (“RF”) and infra-red (“IR”)pyrotechnic decoys.
MARKET TRENDS
The Integrated Review Refresh 2023 (“IRR 23”), set against the backdrop of a
“morevolatile and contested world”, confirmed that a further £5bn will be allocated to
the UKMinistry of Defence (“UK MOD”) over the next two years. This is in addition to
the £24bn, over five years, increase committed in 2020, and the £560m pledged in the
Autumn Statement 2022.
Most of the IRR 23 additional funding will be to support the modernisation of the UK
nuclear enterprise, including support to in-service submarines, and the next phase of
investment in the Australia-United Kingdom-United States (“AUKUS”) partnership,
withthe balance being allocated to replenishing energetic capabilities and investment
toxincrease the resilience of the UK domestic infrastructure.
The Defence Command Paper 2023 (“DCP 23”) restated the aim for UK Defence to
achieve Science and Technology (“S&T”) superpower status as a core element of its
national strategic advantage. Priority areas for S&T investment include AI, semiconductors,
quantum technologies, future telecommunications, and engineering biology. DCP 23 also
pledged an additional £2.5bn investment into UK energetics through the coming decade.
2022
2021
2020
2019
US$877bn
US$806bn
US$778bn
US$734bn
2022
2021
2020
2019
£57bn
£50bn
£46bn
£45bn
UK 34%
USA 49%
Europe 12%
Asia Pacific 4%
Middle East 1%
and rest of
the world
21
Chemring Group PLC Annual report and accounts 202316

LINK TO STRATEGY
1
Niche markets
2
Market-leading positions
TOTAL SPEND
AU$47bn
Source: SIPRI
EUROPE
OUR POSITION
Although the Group continues to vie with highly capable competitors and national
champions in Europe, we have succeeded in selling our niche capabilities to several
European customers including Germany, France, Italy and Spain. Moreover, our
Norwegian-based Energetics business provides speciality materials to many leading
prime contractors across the region.
MARKET TRENDS
The Russia-Ukraine war has brought large-scale conflict to Europe and, having
experienced the steepest increase in three decades, European military expenditure is
now at Cold War levels. The total spend across Central and Western Europe is some
€345bn which, in real terms, surpasses the levels seen at the end of the Cold War (1989).
The sharpest increases have been in Finland (+36%), Lithuania (+27%), Sweden (+12%)
and Poland (+11%).
France is aiming to increase its defence spending to €413bn over the next sevenyears,
and Germany is making progress on reaching the 2% GDP NATO target for defence
investment and on spending the €100bn special modernisation fund.
New and existing NATO members are reacting to the Ukraine crisis and preparing for a
long confrontation with Russia requiring a comprehensive sense of resilience, regardless
of Ukraine’s outcome. Finland joined NATO on 4April 2023, and Sweden’s membership
is pending approval by Hungary. Moreover, NATO is establishing a multi-sovereign
venture capital fund for security and defence innovation through emerging, disruptive
and dual-use technologies.
Finally, the EU is also pledging €500m with a new regulatory framework to bolster
EUdefence industry capabilities.
OUR CHALLENGES AND OPPORTUNITIES
The outlook for the European market is positive, and several opportunities for our niche
capabilities are emerging as countries invest to protect their own national interests and re-equip
Ukraine. The Group will continue to support the requirements of European allied nations.
LINK TO STRATEGY
> READ MORE ON PAGES 18 TO 19
2022
2021
2020
2019
AU$47bn
AU$46bn
AU$41bn
AU$38bn
TOTAL SPEND
US$357bn
Source: SIPRI
AUSTRALIA
OUR POSITION
Chemring’s in-country capabilities are founded on the Group’s integral position in
theF-35 Lightning II international countermeasures supply chain. Chemring Australia is
an important part of the country’s industrial base, with our modern plant being a
state-of-the-art manufacturing facility for airborne countermeasures.
MARKET TRENDS
Australia’s 2023 Defence Strategic Review (“DSR”) sets out the country’s investment
priorities and doctrinal posture, through to 2032-33, for developing a more capable
military. The DSR specifically considers the deteriorating geostrategic environment in
the Indo-Pacific region and the direct threats to Australia’s national interests resulting
from these international tensions. In the 2023 budget, Australia’s defence spending is
setto rise to AU$52.6bn in 2023–24 – an increase of 7%.
The Advanced Capabilities Pillar, known as Pillar II, of the Australia, United Kingdom
andUnited States (“AUKUS”) partnership, notes the tri-lateral delivery – that is joint
research and development (“R&D”) and acquisition of advanced cyber, AI, autonomy,
quantum, undersea, hypersonic and counter-hypersonic, EW, innovation, and information
sharing capabilities. Co-operation under AUKUS Pillar II has the potential to have
wide-ranging effects on defence and national security in all three countries.
OUR CHALLENGES AND OPPORTUNITIES
With Chemring having an industrial presence in all three AUKUS nations, the Group
iswell placed to respond to relevant opportunities resulting from the pact, as well as
other potential bi-lateral and tri-lateral co-operative efforts.
LINK TO STRATEGY
> READ MORE ON PAGES 18 TO 19
2022
2021
2020
2019
US$357bn
US$344bn
US$333bn
US$315bn
OUR CHALLENGES AND OPPORTUNITIES
The UK MOD accounts for circa 13% of Group revenues, and it isan important partner
for developing and qualifying new products and solutions, and for expanding and sustaining
sovereign UK manufacturing capabilities.
The priorities identified in the IRR 23 are well aligned to Group strengths and will
enlarge the opportunity space for the capabilities of our Roke and UK Energetics
businesses – in the near-term and beyond.
Finally, as the sole source supplier of countermeasures to the UK’s F-35 Lightning II fleet,
Chemring is well placed to benefit from the commitment made by the UK MOD to raise
the number of aircraft in the UK’s F-35 Lightning II fleet to 74. The delivery of these
additional aircraft, referred to as “Tranche 2,” will commence before the end of the
decade, with completion expected in the early 2030s.
LINK TO STRATEGY
> READ MORE ON PAGES 18 TO 19
21
21
21
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 17

STRATEGY
INVESTING FOR GROWTH
At Chemring, our purpose is to help make the world a safer place. Across the
physical and digital environment our exceptional teams deliver innovative
technologies and products that detect and defeat ever-changing threats.
Delivering as both a manufacturing and technology company
in markets that align with our purpose and vision
OUR VALUES
Capitalise on the growth in our niche
markets with high barriers to entry
Grow our market-leading
andsolesource positions
OUR STRATEGY
Our strategy is based on the following two pillars:
21
OUR ESG PILLARS
Our approach is focused around the following four areas:
Health and safety
OUR VISION
To be our customers’ preferred supplier operating in niche markets with high
barriers to entry and where we enjoy sole source, or market-leading, positions.
OUR PURPOSE
To help make the world a safer place. Across the physical and digital
environment our exceptional teams deliver innovative technologies and products
that detect and defeat ever-changing threats.
Environment People
Ethics and
business conduct
Safety Excellence Innovation
Connected to this purpose, our
vision for the future is to be our
customers’ preferred supplier –
operating in niche markets with
highbarriers to entry and where
we enjoy sole source, or market
leading, positions. In achieving this
vision, our ambition is to double
thevalue of the Group over the
nextfive years.
Taken together, our purpose and
vision define our strategy and
provide the framework in which
our strategic focus areas lie. We
willcontinue to operate as both
amanufacturing and technology
company, in markets that align with
our vision and purpose, and invest
to capitalise on the unprecedented
levels of market demand that we
are seeing in our portfolioareas.
Alongside delivering on our significant
organic growth opportunities, we
will continue to review and assess
our portfolio, and explore the
opportunity for focused
incremental acquisitions.
Chemring Group PLC Annual report and accounts 202318

NICHE MARKETS MARKET LEADING AND SOLE SOURCE POSITIONS
The rise in global tensions which includes a significant conflict in Europe and
greater instability in the Asia Pacific region, is driving a substantial increase in
overall defence spending.
Russia and the war in Ukraine has produced a step-change in demand for our
niche energetics capabilities, along with a greater focus on national, including
industrial, resilience. Simultaneously, responding to China’s modernisation
investment is generating long-term requirements for our technology-enabled
solutions in areas such as active cyber defence, operational mission support,
Electronic Warfare (“EW”), space launch, missile systems, and biological
security. We will invest to capitalise on this increased and enduring customer
demand by specifically expanding our capacity and developing our offerings in our
selected technology franchises.
In the contested geopolitical environment, countermeasures capabilities will
also continue to remain relevant.
In addition to operating in niche markets where we are seeing significant
spending increases, we also enjoy several strong market positions where
ourcompetitive position is reinforced and differentiated through our market
leading, critical technology.
These technology-enabled capabilities mean that the Group is well placed to
benefit from the extraordinary journey of growth and transformation being
currently experienced by the missile and space sectors.
Our technology expertise in speciality, precision engineered devices for missile
and aerospace applications is vital for our customers’ mission requirements
and we are investing in new product development to maintain our leadership
position in these priority areas. We are also investing to expand our product
portfolio and secure positions on new production programmes in these
specialist markets.
1 2
STRATEGY IN ACTION STRATEGY IN ACTION
In Norway, our Energetics business is a niche strategic supplier to several US
andEuropean prime contractors, with many seeking long-term strategic supply
agreements. We are investing to expand our production capacity to capitalise
onthis long-term market demand and fully exploit our strong strategic position.
In the UK, the renewed focus on peer-level competition has grown the
demandfor Roke’s active cyber defence and operational mission support
services.Ourgovernment clients are increasingly seeking to establish multi-year
arrangements for the supply of these capabilities, with Roke regularly taking
significant leadership roles.
ORDER BOOK
£922m
+42%
Our Scottish Energetics business is the sole source supplier for multiple land, air
and naval systems, including propellant materials and pyro-mechanical devices. It
enjoys a unique competitive position, and we are investing to expand and further
develop its manufacturing capabilities.
Our Chicago business is an established incumbent in the US aerospace and
defence market, supplying most prime contractor and government customers.
Weare capturing growing demand for current products, expanding into new
platforms and programmes, and investing in new product development and
capacity expansion.
ORDER INTAKE
£756m
+37%
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 19

SAFETY
1 2 3
KEY PERFORMANCE INDICATORS
MEASURING OUR PROGRESS
NUMBER OF ENERGETIC EVENTS
CAUSING HARM ORINJURY
0
NUMBER OF NEAR MISSAND
POTENTIAL HAZARD REPORTS
4,907
NUMBER OF RECORDABLE
INJURIES
21
Number of energetic events causing harm
orinjury.
WHY IS IT A KPI?
A process safety event is one of the key strategic
safety risks of the business. This indicator
measures those events that have caused injury
orharm.
2023 PERFORMANCE
There were no life-changing or serious injuries
associated with energetic events in 2023 or 2022.
Number of near miss and potential
hazardsreported.
WHY IS IT A KPI?
This indicates employee awareness of hazards and
the greater the reporting the more engaged our
people are.
2023 PERFORMANCE
As we journey towards our goal of zero harm we
need a workforce that is fully engaged and proactive
in reporting unsafe actions and conditions. One
measure is the reporting of near misses, providing
us with the opportunity to learn and prevent
accidents from happening. It is therefore very
encouraging to see we have maintained a high
level of near miss reporting this year.
Number of recordable injuries per 200,000
manhours worked.
WHY IS IT A KPI?
This is the rate for all injuries including those
requiring medical treatment, a restricted workday
and lost time injuries. It is a more sensitive indicator
of occupational safety than the lost time injury
frequency rate, as more minor events are captured.
2023 PERFORMANCE
We had 21 employee injuries this year, compared
to 17 last year. This resulted in a slight increase in
our recordable injury rate, from 0.78 to 0.90, but
the rate remains below our limit of 1. There were
no fatalities or serious injuries during the year.
FREQUENCY
RATE
0.90
2023
2022 0
0 2023
2022 4,036
4,907 2023
2022
21
17
2023
2022
0.90
0.78
The Group’s strategy is underpinned by focusing
onanumber of key performance indicators (“KPIs”).
These KPIs enable progress to be monitored on the implementation of the
Group’s strategy, levels of investment, operational performance and business
development. They also give an early insight into how well the principal risks
and uncertainties are being managed.
Chemring Group PLC Annual report and accounts 202320

ORDERS REVENUE
4 5 6
Order intake is measured at expected sales value
and represents the last 12 months’ activity.
WHY IS IT A KPI?
The trend of order intake gives an indication of
market conditions and our competitiveness within
our markets.
Order book is measured at expected sales value
and indicates future potential.
WHY IS IT A KPI?
The level of order book, in particular for delivery
in the next year, gives a degree of confidence in
expected future financial performance.
Revenue is measured at sales value less any
applicable sales taxes.
WHY IS IT A KPI?
The trend of revenue gives an indication of both
the state of the end market and our business’
ability to execute orders on time to satisfy
customer needs.
2023 PERFORMANCE
Group revenue was in line with our expectations,
with strong performance at Roke and good
growth in our Energetics businesses.
ORDER INTAKE
GROUP
£756m
ORDER BOOK
GROUP
£922m
REVENUE
GROUP
£473m
2023
2022
£756m
£551m
2023
2022
£922m
£651m
2023
2022
£473m
£401m
2023 PERFORMANCE
Order intake across the Group has increased by 37% to £756m (2022: £551m). This was driven by strong
order intake across the Countermeasures & Energetics sector up 52% to £541m (2022: £356m) where
customers in the Energetics businesses are increasingly placing multi-year orders resulting in Energetics
order intake being up 161% to £358m (2022: £137m). In Sensors & Information, Roke saw order intake
increase by 9%, and our US Sensors business received a US$15m delivery order for the third year of
EMBD full rate production and a $15m LRIP order for JBTDS.
The order book was up 42% to £922m (2022: £651m), with £403m currently due as revenue in FY24,
approximately 79% coverage of FY24 targeted revenue.
Similar indicators are used to review performance by each of the Group’s businesses, albeit that the
exact nature of these varies between business units to reflect the differing nature of their operations.
The KPIs that the Board and senior management utilise to assess Group performance are set out
below. All financial KPIs refer to continuing operations and therefore exclude businesses classified
asdiscontinued and held for sale.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 21

KEY PERFORMANCE INDICATORS continued
2023
2022
8%
29%
2023
2022
14.6%
14.8%
UNDERLYING OPERATING
MARGIN GROUP
14.6%
CHANGE FROM
PREVIOUS YEAR
8%
“ This has been a year of heightened activity and progress across the Group as we have
reacted to growing demand for our products and services. With record order intake
and an order book at the highest level in over a decade, the Group remains well placed
to maintain sustainable performance and growth.”
Michael Ord
Group Chief Executive
UNDERLYING OPERATING PROFIT
AND MARGIN
UNDERLYING EARNINGS PER SHARE WORKING CAPITAL AND INVENTORY
7 8 9
UNDERLYING OPERATING
PROFIT GROUP
£69.2m
UNDERLYING DILUTED
EARNINGS PER SHARE
20.0p
WORKING CAPITAL
GROUP
£82.3m
Underlying operating profit excludes non-underlying
items that, by their size or nature, need to be
separately disclosed to properly understand the
Group’s underlying quality of earnings. Underlying
operating margin is calculated as underlying
operating profit divided by revenue.
WHY IS IT A KPI?
Underlying operating profit provides a consistent
year-on-year measure of the trading performance
of the Group’s operations. A focus on operating
margin allows the impact of changes in revenue
and cost base to be monitored, enabling
comparisons to be made of management
performance and trading effectiveness.
2023 PERFORMANCE
The underlying operating profit increased by
16%.The changes in margin of each sector
reflectthe market conditions, volume changes
andperformance improvement actions, as set
outin this strategic report.
Calculated as underlying earnings after tax divided
by the number of shares in issue.
WHY IS IT A KPI?
The measurement of underlying EPS reflects
allaspects of the Group’s income statement
including the management of interest and tax.
2023 PERFORMANCE
Underlying EPS increased by 8% in 2023, driven
by increased underlying operating profit, and
lower interest which was offset by an increase
inthe Group effective tax rate.
Working capital is defined as inventories, trade
and other receivables, less trade and other
payables excluding payroll-related and other
liabilities totalling £30.3m (2022: £31.4m).
WHY IS IT A KPI?
Efficiently turning profit into cash demands
adegree of control over working capital.
2023 PERFORMANCE
Working capital as a percentage of revenue was
lower at 17% (2022: 21%), demonstrating the
continued effective management of working capital.
2023
2022 18.5p
20.0p 2023
2022
£82.3m
£93.9m
2023
2022
£69.2m
£59.4m
Chemring Group PLC Annual report and accounts 202322

CONVERSION OF UNDERLYING EBITDA
INTO UNDERLYING OPERATING CASH
90%
2023
2022
90%
110%
WORKING CAPITAL AND INVENTORY NET DEBT AND CASH FLOW
10 11 12
INVENTORY
GROUP
£101.7m
NET DEBT:
UNDERLYING EBITDA
0.16x
UNDERLYING OPERATING
CASH FLOW
£80.0m
Inventory is measured at cost.
WHY IS IT A KPI?
The primary focus for improvement in working
capital is inventory.
2023 PERFORMANCE
Inventory increased, as did advance payments
from customers, reflecting the timing of customer
procurement in Countermeasures & Energetics.
Measured as net debt divided by underlying
EBITDA for the previous 12 months.
WHY IS IT A KPI?
This is a measure of leverage within the business
and is a banking covenant.
2023 PERFORMANCE
This has increased in 2023, as underlying EBITDA
has increased and net debt has increased largely
due to the deployment of £9m into the share
buyback programme.
Cash flow from operating activities before tax
outflows, non-underlying items and pension payments.
WHY IS IT A KPI?
This is a key measure to ensure profit turns into
cash in short order.
2023 PERFORMANCE
Operating cash conversion was 90% (2022: 110%)
and on a rolling 36-month average was 101%,
showing the effective management of working
capital through the cycle.
2023
2022 0.09x
0.16x
£85.1m2022
£80.0m20232023
2022
£101.7m
£99.6m
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 23

KEY STRENGTHS
EMPLOYEES
We have a highly skilled and knowledgeable workforce
operating in specialist capability areas. Their
dedication and expertise is critical to us delivering
innovative solutions to our customers’ challenges.
CUSTOMER RELATIONSHIPS
We enjoy strong, long-term and collaborative
relationships with defence and intelligence
customers in the member countries of the
multilateral “Five Eyes” (the US, the UK, Canada,
Australia and New Zealand) alliance. We have
specific, opportunity driven relationships in
selected other markets where we can apply
ourcapabilities.
SUPPLIER COLLABORATION
We form key partnerships with our suppliers
toenhance customer value.
FACILITIES
We are investing in the resilience and capacity
ofour facilities to produce our products safely,
securely, and efficiently as well as delivering our
expected growth.
TECHNOLOGY
We create market-leading technology-based
solutions to meet our customers’ most critical needs.
Our ESG pillars
Our sectors
Our values
Our strengths
BUSINESS MODEL
CREATING VALUE
Our business model creates value for all our stakeholders. We focus on providing
innovative capability solutions that reliably meet our customer requirements on
time and every time.
INNOVATING
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WHAT WE DO
INVEST IN PEOPLE, PROCESSES
ANDPRODUCTS
Chemring is a technology business with
approximately 2,600 employees worldwide.
We invest in our future by developing the
capabilities of our people, maintaining safe
and efficient operations, and anticipating and
developing next-generation solutions to meet
our customers’ needs.
BIDDING AND WINNING ORDERS
We operate in niche segments of the
international defence and security market.
Our strategy-led investments ensure we
arewell positioned to offer advanced and
dependable technology solutions to meet
ourcustomers’ needs, and we continually
look for new growth opportunities to
deployour capabilities.
In Countermeasures & Energetics, we are the
world’s largest supplier of countermeasures,
through our leading technology and
manufacturing position. Our niche Energetics
businesses win orders based on the technical
performance and superiority of our products.
In Sensors &Information, we maintain our
leadership position in multiple capabilities to
develop differentiated solutions for meeting
ever-more demanding customer requirements.
DELIVER SOLUTIONS
We focus on providing innovative and
competitive solutions that meet our
customers’ needs efficiently and on time.
Inaddition to our capital and technology
investments we also invest to drive a culture
of continuous improvement which is a key
component of minimising the cycle time
fromorder to delivery.
Chemring Group PLC Annual report and accounts 202324

OUTCOMES
INVESTMENT
Our investment in property, plant and equipment
in the year totalled £38.5m. In addition, we invested
£113.6m in product development, of which £102.0m
was customer funded. A £120m capacity expansion
plan to 2026 has been initiated to capitalise on
growing demand in the Energetics market, delivering
incremental revenue of £85m per annum.
INVESTMENT
£152.1m
(2022: £118.2m)
CASH FLOW
We aim to convert 100% of underlying EBITDA
to underlying operating cash flow over the medium
term, accepting that timing differences willarise at
individual period ends. In 2023, the conversion ratio
was 90%, and the average underlying cash conversion
of underlying EBITDA on a rolling 36-month basis
is 101% (2022: 108%). This reflects the strong
operating cash generation and the continued
focuson managing working capital.
UNDERLYING CASH CONVERSION
90%
(2022: 110%)
DIVIDENDS
For the year ended 31 October 2023, our dividend
will be 6.9p per share (2022: 5.7p), an increase of
21% on the prior year, subject to the approval of
the final dividend at the Annual General Meeting.
DIVIDENDS
6.9p
(+21%)
STAKEHOLDER VALUE
CUSTOMERS
Our customers are governments, prime
contractors and other commercial businesses.
Weprovide innovative and reliable solutions to
satisfy their requirements.
INVESTORS
Returning cash to shareholders is a critical element
of our disciplined capital allocation strategy.
Through successfully executing our corporate
strategy and developing our business, we grow
thevalue of their investment over time.
EMPLOYEES
The skills and experience of our employees are
essential for us satisfying our customer needs.
Weprovide development opportunities and safe,
stimulating and rewarding working environments
for all our people to fulfil their potential.
SUPPLIERS
We build meaningful relationships with our
suppliers who partner with us to deliver innovative
solutions and are supported consequently through
our procurement of their goods and services.
COMMUNITIES
We make a positive contribution to the local
communities that we impact by actively supporting
the development of economic prosperity through
providing high value jobs.
GOVERNMENTS
We pay taxes in the jurisdictions in which we
operate, thereby supporting the development
ofpublic infrastructure and services such as
healthcare, education, transport systems and
lawenforcement.
> READ MORE ABOUT OUR STAKEHOLDERS
ON PAGES 34 TO 37
OUR VALUES
SAFETY
We place safety first in everythingwedo.
- We ensure we operate safely and manage risk.
- We promote best safety practices across
our operations and beyond.
- We are committed to ensuring we minimise
our impact on the environment.
EXCELLENCE
We are focused on ensuring we
consistentlymeet high standards in all
thatwedo.
- A culture of continuous improvement
iscore to our approach.
- We act to ensure that we maintain and
deliver operational excellence.
- We always deliver on our promises.
INNOVATION
We create innovative solutions to
ourcustomers’ challenges.
- We inspire imaginative solutions.
- We work together to turn ideas into
technologies and solutions.
- We value collaboration and sharing experience.
> READ MORE ABOUT OUR
SUSTAINABILITY
ON PAGES 38 TO 41
CLIMATE CHANGE
We recognise the material and enduring effects of climate change, and its increasing impact on
our markets. We are actively seeking ways to reduce our impacts on the environment and build
resilience to climate and other nature-related risks by focusing on energy and waste, understanding
their effect on our sites and operations.
> READ MORE ON PAGES 44 TO 55
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 25

REVENUE
£187.0m
(2022: £120.5m)
UNDERLYING OPERATING PROFIT
£34.2m
(2022: £25.4m)
ORDER BOOK
£171m
(2022: £154m)
UNDERLYING OPERATING MARGIN
18.3%
(2022: 21.1%)
STATUTORY OPERATING PROFIT
£10.7m
(2022: £22.4m)
KEY FACTS
FOCUS ON
SENSORS & INFORMATION
In our Sensors & Information sector we are
aleadingsupplier of consulting and technology
services, trusted by government and industrial
partners worldwide to solve the most technically
challenging defence and security-critical issues.
Our products include core technologies for detecting, intercepting and jamming
electronic communications, and world-leading systems for detecting biological
agents. Operating across defence, national security, law enforcement
andcommercial domains the Sensors & Information sector is constantly
innovating to enable customers to deliver competitive advantage and
todefend their people, assets and information.
STRATEGY
The Sensors & Information sector is a key area of long-term growth for
Chemring, reflecting increasing customer demand and opportunities in this
domain. We continue to focus on expanding the Group’s product and service
capability offerings in the areas of tactical Electronic Warfare (“EW”), artificial
intelligence (“AI”), Open-Source Intelligence (“OSINT”), machine learning and
information security. We are also focused on developing and executing a
technology-based strategy for growth beyond current US DoD Programs
ofRecord in our US sensors technology areas.
The Group’s specialist consulting and technology services business, Roke,
operates in growing cyber and digital-services markets. Investing in attracting
and retaining the best technical talent, together with continued geographic
expansion in the UK to follow our customers’ mission, is key to long-term
profitable growth in this area. We also continue to actively explore opportunities
to expand and accelerate Roke’s capability offerings to drive medium and
long-term growth, including leveraging opportunities in adjacent markets and
territories. In the short term this will require continued operating expense
investment across the Roke business.
Cubica Group, acquired in 2021, has been fully integrated into the new Roke
Futures business area. Roke Futures services the needs of public and private
sector customers seeking to improve their operational effectiveness and
performance through intelligent digital solutions and automation. Geollect,
acquired in December 2022, has provided the technology platform underpinning
Roke’s Intelligence-as-a-Service offering – our response to the rapidly growing
demand for OSINT. Geollect has also brought capabilities to supplement Roke’s
offerings in data ingestion, AI, machine learning and data science. We continue
to explore further inorganic growth opportunities and have a robust pipeline
of future acquisition candidates.
MARKETS
Russia’s invasion of Ukraine and China’s rapid military modernisation have
seen increased defence investment across a range of allies including European
members of NATO. The need for countries to invest in capabilities to deter
and defeat such peer-level adversaries is key. In this context, genuine partnerships
and alliances, such as Five Eyes, AUKUS, and NATO, have become a critical
element of the geopolitical landscape, with greater co-operation and alignment
between allies essential.
The US continues to be the largest defence and security market in the world
and remains opportunity-rich for the Sensors & Information sector. The
US$842bn FY24 President’s Budget Request for the US DoD is the largest
ever and has a strong modernisation agenda including investment priorities for
technology-enabled solutions in cyber, Electronic Warfare and chem/bio-security.
Chemring’s capabilities should give us the opportunity to address many of
these requirements.
The US Government’s focus on peer-level competition in the Indo-Pacific area,
with associated dis-investment in capabilities for counter-insurgency operations,
saw our HMDS system transition into sustainment phase. This led us to evaluate
the potential sustainment programme and we determined that we would not
continue with the explosive hazard detection business.
In the UK, the March 2023 Integrated Review Refresh 2023 (“IRR 23”) of
Defence, Security and Foreign Policy validated the fundamentals of our market
position and strategy. The IRR focused on the UK’s ability to deter, defend
and compete across all domains, most notably in the areas of cyber, information
advantage, the digitalisation of defence, artificial intelligence, and multi-domain
integration. A key element of the IRR 23 was the need to upgrade statecraft
for systemic competition. This is driving demand for Roke’s national security
capabilities, particularly in active cyber defence and technological mission
support services forcore government customers. These well-funded
priorities, which were reconfirmed by the July 2023 Defence Command
Paper (“DCP”) update, are expected to continue the growing demand for
Roke’s market-leading technologies.
In both these home markets, the need to keep pace with rapidly-evolving and
complex threats aligns well with our Sensors & Information strategy. The consistent
capability requirements across Five-Eyes, AUKUS, and NATO countries should
increase the opportunity space for Chemring to deploy its market-leading
technologies, such as cyber and AI, in these areas of growing requirement.
Chemring Group PLC Annual report and accounts 202326

PURPOSE IN ACTION
ROKE TO DELIVER £40M CONTRACT FOR THE NEXT
PHASE OF PROJECT ZODIAC
Roke has signed a £40m contract to deliver the next two years of Project
ZODIAC for the British Army. ZODIAC is the backbone of the Army’s Land
ISTAR Programme. It will deliver an ISTAR system, which will transform how
theArmy undertakes data-led decision making in the Land environment to gain
operational advantage.
As the Prime Systems Integrator for the project, Roke will integrate sensors,
deciders and effector systems to deliver a Minimum Viable Product ISTARsystem
that will operate in the Degraded, Denied, Intermittent and Limited-Bandwidth
communications environment of the modern battlefield.
ZODIAC will provide an integrated and distributed system of applications and
underlying system architecture that will enable the Army to understand, decide
and act with greater precision and speed and digitally integrate with key allied
partners. The system will be complemented by a software and data DevSecOps
pipeline to enable rapid enhancement, long term system evolution and the
management of pre/post-mission data loads. This pipeline will be key to
transforming how the Army operates.
Aligning with the goals set out in the most recent UK MOD’s Defence Command
Paper, Roke’s work on this project will be integral to digitalising the Army’s
Sensor-Decider-Effector chain, contributing to faster decision-making, lower
cognitive burden on operators, and more efficient use of the Army’s resources.
ZODIAC will provide the platform for the introduction of AI into the Army’s
ISTAR processes, increasing the quality of decision-making and speeding up the
tempo of operations. ZODIAC will contribute to the UK MOD’s objective of
achieving Digital Deterrence: realising a strategic deterrence effect through
digitaladvantage.
> DISCOVER MORE ABOUT SENSORS & INFORMATION AT
CHEMRING.COM/WHAT-WE-DO/SENSORS-AND-INFORMATION
LINK TO STRATEGY
> READ MORE ON
PAGES 18 TO 19
LINK TO OUR VALUES
> READ MORE ON
PAGE 25
EXCELLENCE
1
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 27

FOCUS ON continued
SENSORS & INFORMATION continued
PURPOSE IN ACTION
ROKE IS WORKING WITH A FTSE 100 MINING COMPANY
ON A MULTI-SENSOR PROJECT
Roke’s client is at the forefront of sustainable innovations in mining that deliver
exceptional results across the whole mining value chain. This project offers
significant business opportunities to improve efficiency at mines by sensing the
grades of materials on the top surface of each truck. This enables trucks to be
routed to the most appropriate processing facility to extract the maximum value
from the load.
Roke’s team of consultants and system architects provide technical support to:
- deliver the system architecture;
- design the data ingest layer;
- review the designs and assessment testing of the novel system to ensure they
meet the requirements; and
- provide auxiliary sensor solutions to aid the efficiency and safety of the new platform.
As a strategic innovation partner, Roke’s technology and consultancy teams work
with the client to ensure the successful delivery of the innovative multi-sensor platform.
According to industry analysts, this type of innovation will lead to increased yield,
cost efficiencies, and improved performance in safety and environmental impact
by pioneering the use of artificial intelligence (“AI”) in the mining sector. Overall,
the mineral extractives industry will achieve higher commodity prices, greater
profits, and cash flows using AI and automation, reflecting positively on their
shareprice and investor value.
LINK TO STRATEGY
> READ MORE ON
PAGES 18 TO 19
LINK TO OUR VALUES
> READ MORE ON
PAGE 25
INNOVATION
1
PERFORMANCE
Order intake in the year was up 10% to £215m (2022: £195m). This was driven
by a 9% increase in Roke’s order intake, with a growing number of multi-year
contracts for products and services, which include an element of “pass-through”
(see table below for an analysis of the impact of this), and the receipt of a
US$15m delivery order for the third year of EMBD full rate production. Our
US Sensors business also received a $15m low rate initial production (“LRIP”)
contract for the JBTDS Program of Record in September 2023.
Roke “pass-through” impact
2023
£m
2022
£m Change
Order intake
Products and services 156 132 18%
Pass-through 27 36 (25%)
As reported 183 168 9%
Revenue
Products and services 128 94 36%
Pass-through 32 16 100%
As reported 160 110 45%
Revenue for Sensors & Information increased by 55% to £187.0m (2022: £120.5m)
and underlying operating profit increased by 35% to £34.2m (2022: £25.4m),
as underlying operating profit margin declined to 18.3% (2022: 21.1%) driven
by the operating expense investment in Roke Academy, Roke Futures and Roke
USA, and the increase in margin dilutive “pass-through” revenue as shown in
the table above. Adjusting for the “pass-through” revenue, the Sensors &
Information underlying operating profit margin would have been 22.1%. On
aconstant currency basis revenue would have risen 55% to £187.3m and
underlying operating profit would have increased by 35% to £34.3m. The
statutory operating profit for the year was £10.7m (2022: £22.4m), with the
decrease driven by the non-cash impairment of Chemical Detection assets.
In the UK, the markets for EW, cyber and data science capabilities, in which
Roke is a leading participant, have remained buoyant in the period. As shown
above, Roke has delivered strong growth in orders and revenue with double-digit
growth in underlying operating profit and has maintained strong margins
despite increased investment in people, infrastructure and product development.
In September 2023 Roke received a significant contract award valued at £40m
to deliver the next two years of Project ZODIAC for the UK MOD. ZODIAC
is the backbone of the British Army’s Land ISTAR Programme, and will deliver
an integrated intelligence, surveillance, target acquisition, and reconnaissance
(“ISTAR”) system, which will transform how the Army undertakes data-led
decision making in the Land environment to gain operational advantage.
ZODIAC will provide an integrated and distributed system of applications
andunderlying system architecture that will enable the Army to understand,
decide and act with greater precision and speed and digitally integrate with
key allied partners. Roke will act as the Prime Systems Integrator on this
advanced technology programme supported by a supply chain of some of
theworld’s leading technology companies. The Group expects to see the
majority of deliveries under ZODIAC in FY24 and early FY25.
In Roke’s defence markets, the increasing importance of Cyber and
Electromagnetic Activity (“CEMA”) in today’s threat environment,
heightenedfurther as a consequence of Russia’s invasion of Ukraine,
hasledto a growing number ofenquiries for Roke’s suite of world-leading
Electronic Warfare products.
A notable highlight in the period has been the progress made in the Roke
Futures business area, which has continued to make strong progress in scaling
its business activities in 2023. Roke Futures delivers technology solutions to
clients outside of National Security and Defence markets and is gaining traction
with customers including Rolls-Royce, Waygate Technologies, Vodafone and a
FTSE 100 multinational mining company, through the development of innovative
technology solutions and approaches. Roke technologies and capabilities, such
as autonomy and intelligent sensing, can fundamentally change the way in which
minerals are processed, unlocking production capacity through improvements
in efficiency and the reduction ofwaste.
In the last five years, successful execution of its strategy has seen Roke double
in size. Its headcount has increased from c.400 at the end of 2018 to c.1,000
today, driven in part by the success of its graduate and apprenticeship schemes,
and the continued success of the Roke Academy.
During 2023 the Roke Academy welcomed its second and third cohorts of
engineers, with the first cohort, who joined in July 2022, now operating as fee
earners out of the new Woking office. This year’s two cohorts have brought
in 50 new engineers, of whom ten are female, all from a wide variety of backgrounds.
The Roke Academy’s new graduate bootcamp is now running with tailored
training in place to meet the practical needs of Roke’s business units in ensuring
graduates develop a commercial mindset in addition to core technical skills.
The Roke apprentice scheme has been re-designed and now works more
closely with line managers and project managers; helping them to understand
the demands of apprenticeships and the work study balance. This year we
saw a total of 27 new apprentices and graduates – which also brought in
increased diversity into the Roke business. All these activities are positioning
Roke well to deliver on its future growth ambitions.
Chemring Group PLC Annual report and accounts 202328

Roke USA continues to make good progress as it seeks to capitalise on
opportunities with the US DoD customer. Highly successful demonstrations
of our Resolve and Perceive man portable systems have generated US DoD
interest in Roke USA developing a system that utilises Roke UK’s sophisticated
mission analysis software, but which specifically targets the US DoD requirement
set. A number of large customer-funded Electronic Warfare (“EW”) development
programmes have been initiated and in addition to EW hardware Roke USA
has now established a presence providing research and development services
focused on advanced EW algorithms.
Also in the US, our US Sensors business continued its transition away from
explosive hazard detection to focus on building winning solutions to convert
current US Programs of Record into low rate and full rate production, and
onexploiting a growing opportunity in bio-security and surveillance. In a
post-pandemic and contested world, governments are becoming increasingly
concerned by the risks of both naturally occurring and engineered biological
threats. Advances in synthetic biology now give our national adversaries the
capability to deliberately engineer organisms to create hazards and cause harm.
Following the successful completion of the engineering and manufacturing
development (“EMD”) phase of the Joint Biological Tactical Detection System
(“JBTDS”) program, a low rate initial production (“LRIP”) Production Readiness
Review, with supporting Manufacturing Readiness Assessment, took place in
mid-May. In August 2023 our US Sensors business was informed that the
Milestone C procurement decision in respect of the JBTDS program had
been approved and in September 2023 the business received a LRIP contract,
valued at $15m. Hardware deliveries under this contract will be made over
the next ten to 14 months, with a full rate production contract expected to
be awarded thereafter.
Deliveries under the full rate production phase of the Enhanced Maritime
Biological Detection System (“EMBD”) program have continued as planned.
This fully automated sensor to rapidly detect, collect, identify and sample
airborne biological warfare agents is supporting the US Navy. We received
athird option quantity exercised under the sole source $99m Indefinite
Delivery/Indefinite Quantity contract worth $15.3m, with deliveries to be
made in FY23 and FY24.
Chemring’s experience and expertise in fielding biological agent detectors
forits US DoD customers provides a strong platform from which to pursue
opportunities in existing and adjacent markets, such as homeland security.
Under development funding from the Department of Homeland Security’s
Countering Weapons of Mass Destruction (“CWMD”) office, Chemring is
designing and testing an advanced bio sensor for detection, classification, and
presumptive identification of aerosol bio threats using electro-optics technology.
Chemring’s system not only dramatically shortens the time taken to identify
the threat, but significantly reduces total lifecycle cost of ownership over
fielded systems that require recurring consumables. The system, along with
aChemring low-cost bio aerosol trigger sensor, have been down-selected
andtested as part of multi-agency field events to evaluate emerging
capabilities against operational mission requirements.
Chemring continues to invest in its BIOFAST
TM
next-generation bio threat
identifier platform, a point-of-need capability providing rapidly adaptable, cost
effective, and high performance testing of bio warfare and infectious disease
threats. Chemring is actively pursuing federal and industry partnerships to
bring the product to a broad range of markets.
Following the US DoD’s decision in 2022 to transition the HMDS Program
ofRecord to sustainment earlier than they had previously indicated, we
evaluated the potential sustainment program and determined that in the
short to medium term there is insufficient US DoD funding to make it
economically viable for Chemring to continue to operate the business.
Thedecision has therefore been taken that the explosive hazard detection
(“EHD”) business will not continue to operate and it has therefore been
treated as a discontinued operation in 2023. A non-cash impairment, within
discontinued operations, of the goodwill associated with the acquisition of the
EHD business in 2009 and other assets, totalling £31.4m, has been recorded.
In addition, having undertaken a wider strategic review of the US Sensors
business the Group has concluded that the prospect of securing a Program
ofRecord in the chemical detection part of the business is no longer probable
and therefore we have chosen to record a non-cash impairment ofthe previously
capitalised development costs and other assets, totalling £18.5m, which has
been recorded as a non-underlying item. Given the competitive nature of this
program Chemring did not include any revenues associated with the AVCAD
program in its forward guidance to research analysts and the market.
The Group has moved quickly and decisively to reposition and reshape its US
Sensors business to ensure sustainable competitive advantage in its targeted
biological detection and security markets.
OPPORTUNITIES AND OUTLOOK
The focus for Sensors & Information continues to be on expanding the
Group’s product, service and capability offerings in the areas of national
security, AI and machine learning, tactical Electronic Warfare and information
security, and securing positions on the US DoD Programs of Record.
In the UK, the national security and defence markets continue to grow with
afocus on emerging technologies in connectivity, cyber, automation and
dataanalytics. Driven by the needs of our national security, defence and
commercial customers to access open source intelligence, Roke has created
an Intelligence-as-a-Service business which combines proprietary datasets,
AI,and customer facing platforms to provide nation state level intelligence
toboth government and commercial customers. Viewed as a key enabler of
tactical success, our expectations are that this business can grow at 35%
CAGR. Roke will continue to focus its efforts on growing across all its
business areas, delivering research, design, engineering and advisory services
using its high-quality people and capabilities.
In the 2022 annual report, we stated that our vision for the next five years
was to maintain Roke’s recent record of growth, doubling annual revenue to
greater than £200m organically, whilst maintaining strong margins. With the
increased activity that we have seen across all Roke’s business areas we have
revised that vision, raising our ambitions to increase Roke’s annual revenues
togreater than £250m organically by 2028, whilst maintaining strong margins.
As demonstrated with the acquisition of Geollect in December 2022, the
integration of which is progressing as planned, we will continue to actively
explore opportunities to expand and accelerate the Sensors & Information
sector capabilities and offerings, both by leveraging opportunities in adjacent
markets and through further bolt-on acquisitions. However, any acquisition
must meet a strict set of criteria, enhance shareholder value and fit in with
our wider growth plans.
In our US sensors business the EMBD program provides good short-term
visibility and following the LRIP award on JBTDS in 2023 we expect this
program to enhance medium-term visibility but first full rate production
revenue is not expected until 2025.
The order book for Sensors & Information at 31 October 2023 was £171m
(2022: £154m) driven by strong order intake and an increase in multi-year
contracts in Roke and the award of JBTDS LRIP in US Sensors. Of this, £122m
is expected to be delivered in 2024, providing 61% cover of expected 2024
revenue. 2024 trading performance for Sensors & Information is expected to
show a continuation of the momentum seen in 2023, with continued growing
demand for Roke’s products and services. Medium-term growth opportunities
in the US are driven by the Group’s sole source positions on the biological
detection Programs of Record moving into full rateproduction.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 29

FOCUS ON
COUNTERMEASURES & ENERGETICS
REVENUE
£285.6m
(2022: £280.5m)
UNDERLYING OPERATING PROFIT
£50.5m
(2022: £48.9m)
ORDER BOOK
£751m
(2022: £497m)
UNDERLYING OPERATING MARGIN
17.7%
(2022: 17.4%)
STATUTORY OPERATING PROFIT
£48.8m
(2022: £46.8m)
In our Countermeasures & Energetics sector,
wehave deep technical expertise in high-hazard
precision engineering and manufacturing. Chemring
isthe world leader in the design, development and
manufacture of advanced expendable countermeasures
and countermeasures suites for protecting air and sea
platforms against the growing threat of guided missiles.
Our niche, world-class Energetics portfolio provides high-reliability, single-use
devices, propellant and high-quality explosive materials. These are used to
perform critical functions for the space, aerospace, defence and industrial
markets including satellite deployment, aircrew egress and aircraft safety systems.
STRATEGY
The Countermeasures & Energetics sector strategy is operationally driven. We
will continue to strengthen and protect our niche, world-leading positions by
investing in our technology base and continuously improving and modernising
our operations, with a particular focus on safety and automation. Simultaneously,
and as announced in June 2023, we are making significant investments to
expand the capacity of our focused Energetics businesses to capture the
unprecedented, and sustained, demand for our products that is being driven by
the increased threat environment. We see significant opportunity through
partnering with our customer base on future technology advancements to
develop new solutions to meet their emerging needs.
Protection solutions against conventional threats in the traditional domains
ofair, sea and land remain vital, and are important areas for the Group to
maintain technology leadership.
Our Countermeasures businesses continue to adopt a holistic approach to
their activities, sharing intelligence, products, and processes, and promoting
the benefits of these capabilities to an international customer base. This includes
the development of multi-shot countermeasures that combine multiple payloads
in one flare body to deliver enhanced aircraft protection. The investment in
the US manufacturing operations for our Countermeasures & Energetics sector
will improve safety through remote operations, improve quality though automation
and deliver extrusion capacity required for next-generation flare production.
Our strategy for our Energetics businesses remains to focus on the high value
differentiated areas of the market where market demand is most robust.
Beyond the elevated levels of demand driven by the contested and volatile
geopolitical environment, our Chicago operation is well placed to benefit
from robust growth in the space segment.
MARKETS
Russia’s invasion of Ukraine is likely to have an enduring catalytic effect
ondefence and security budgets with countries looking to deter aggression
andprotect their own international interests.
In the Countermeasures & Energetics sector the need for our niche capabilities
will continue to remain relevant in the contested military environment, so
long-term demand and associated funding are expected to remain robust.
Given the threat environment, NATO members (and non-NATO European
countries) have already committed to increasing their defence spend to replenish
energetic stockpiles in significant quantities. These are likely to be maintained
at higher levels for future, and demand for the Group’s capabilities is expected
to increase.
Chemring continues to hold a leadership position in the addressable air
countermeasures market. Demand in the countermeasures sector over the
next five years is primarily being driven by US and international requirements,
coupled with new technologies being developed in the UK that will be shared
across the Group’s businesses.
Sole source positions on several products and platforms in conjunction with
high barriers to entry are evidenced by our strong order book.
KEY FACTS
Chemring Group PLC Annual report and accounts 202330

PURPOSE IN ACTION
SEVEN YEARS IN SPACE BEFORE ACTION – CHEMRING’S
PART ON NASA’S OSIRIS-REx SPACECRAFT MISSION
Back in 2015 our Chicago business, Chemring Energetic Devices, supplied
critical components for NASA’s unique Asteroid Bennu mission to
return a sample from the ancient asteroid on the OSIRIS-REx spacecraft.
OSIRIS-REx launched from the Atlas V 411 Rocket on 8 September
2016, on a seven-year mission, successfully rendezvousing with Bennu
in2018. The spacecraft carried out two rehearsals preparing for the
sampling procedure, which successfully took place on 20 October 2020.
Three years and 200 million miles later, on 24 September 2023, the
spacecraft completed its mission of returning a sample of the asteroid to
Earth. Its sample return capsule (“SRC”) touched down in the Utah
desert in a picture-perfect landing. Just before re-entering Earth’s
atmosphere, the SRC separated from thespacecraft body, which
required two of Chemring’s cable cutters.
The SRC contained about a cup’s worth of asteroid rocks collected
from the surface of Bennu; the black pebbles and dirt are older than
Earth and are undisturbed remnants of the solar system’s early days of
planet formation.
This mission will help scientists investigate how planets are formed and
how life began and improve our understanding of asteroids that could
impact Earth.
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INNOVATION
2
©
NASA HQ PHOTO
> DISCOVER MORE ABOUT SENSORS & INFORMATION AT
CHEMRING.COM/WHAT-WE-DO/COUNTERMEASURES-
AND-ENERGETICS
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 31

FOCUS ON continued
COUNTERMEASURES & ENERGETICS continued
MARKETS continued
Demand for the F-35 Lightning II stealth multi-role combat aircraft continues
to be strong, and our contribution to this advanced platform’s countermeasures
suite confirms our leadership position in this capability area. F-35 Lightning is
a franchised US defence programme and remains a key driver of growth in
this sector, with the US planning to buy 2,456 aircraft through to 2044, and
the UK confirming it intent to expand its number of platforms to 74. International
sales performance also remains robust, with Germany placing an order for
35F-35A in December 2022 and Canada ordering 88 aircraft in January 2023.
As a provider of countermeasures for this fifth-generation fighter, these
programmes will contribute to us sustaining our leadership position inthe
addressable air countermeasures market.
In the specialist energetic devices and materials businesses, the Ukraine conflict,
the change in stockpile assessments across NATO nations, and the threat of a
future conflict with China have all combined to present us with the opportunity
to capitalise on this elevated and enduring customer demand by expanding
our capacity. Increasingly, customers are signing long-term contracts in order
tosecure supply and this improved visibility is enabling greater focus on our
investment into manufacturing capacity, efficiency and product R&D.
The outlook for the global defence market is increasingly positive, with strong
growth predicted over the next decade. In particular, we are now seeing
governments’ announcements of budget increases manifesting into new orders.
PERFORMANCE
Order intake in the year up 52% at £541m (2022: £356m), driven by
multi-year orders received across the sector.
In the Energetics sector we continue to see increased levels of activity and
demand in the propellants and energetic materials markets as customers
re‐evaluate their operational usage and stockpile requirements associated
with traditional defence capabilities. As a result, our three niche Energetics
businesses, which design and manufacture high precision engineered devices
and specialist materials, have seen strong customer demand with order intake
up 161% to £358m (2022: £137m).
Our Norwegian-based subsidiary, Chemring Nobel, had a particularly strong
performance, finishing the year with a record order book which provides
significant visibility over the medium term. Over £40m of orders were won in
the final month of the year, which included a £30m order to supply Dyno-Nobel
with a range of energetic materials over the next five years. Chemring Nobel
continues to work with other customers including Diehl Defence, Rheinmetall
and Nammo on similar long-term contracting models.
Our Scottish facility received notable contract awards including a £43m
orderfor the delivery of critical components used on the NLAW system.
In the US, our Chicago business received multiple orders in the period including
two contracts totalling $23m to supply critical components to Lockheed Martin,
and a $46m order to supply key parts on the United Launch Alliance (“ULA”)
Vulcan launch system, including flight-critical initiators, thrusters and cartridges.
Our Chicago business now has a record order book which is in excess of
$165m. Orders in the final month of the year alone exceeded any prior full
year order intake.
This strong performance demonstrates the value that our customers place on
Chemring’s niche products and reinforces our decision to invest in expanding
capacity at our Energetics sites.
PURPOSE IN ACTION
NEW ENERGETICS PROPELLANT FACILITY
Work has begun on a new £40m propellant facility at Chemring
Energetics UK’s (“CEUK”) Ardeer site. The propellant facility forms part
of an ongoing capital expenditure programme to modernise and
upgrade the whole CEUK site following the completion of the new
testing and proofing facility earlier this year.
Across Chemring, a key focus throughout FY23 has been continuously
improving our technological and operational base. The new propellant
facility in Ardeer will provide a more streamlined and efficient manufacturing
process with improved capacity.
By reducing the physical distance between the various elements of the
production process, the new facility will enable the team to produce
current volumes more effectively whilst increasing the capacity to meet
growing market demands.
The completed facility will comprise five main process buildings, five
storage buildings or magazines, one packing building, and one welfare
building for colleagues, including offices, training facilities, and rest areas.
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INNOVATION
2
EXCELLENCE
Chemring Group PLC Annual report and accounts 202332

PURPOSE IN ACTION
CHEMRING COUNTERMEASURES UK (“CCM UK”) RECEIVES
DEFENCE GOLD EMPLOYEE RECOGNITION SCHEME
AWARD FOR COMMITMENT TO ARMED FORCES
CCM UK is honoured to have achieved the esteemed Gold Award
fromthe Ministry of Defence’s Employer Recognition Scheme for its
unwavering support and dedication to the Armed Forces community
inthe South East region.
This recognition, the highest bestowed upon organisations, signifies
CCM UK’s exemplary commitment to the Armed Forces and inspires
others to follow suit.
As a Gold Award recipient, CCM UK actively promotes and maintains a
positive environment for employees who are veterans, Reservists and
Cadet Force adult volunteers, as well as spouses and partners of those
serving in the Armed Forces.
With over 30 veterans and reservists within its Armed Forces community,
CCM UK implements various policies and initiatives aimed at facilitating a
seamless transition from military service to civilian employment, ensuring
continued support for their valuable contributions.
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INNOVATION
21
In Countermeasures we have continued to see sustained customer demand
from across our portfolio, maintaining our position as the world leader in the
design, development and manufacture of advanced expendable countermeasures.
Order intake was £183m (2022: £220m), with notable contract awards
including $39m for the delivery of MJU-61 flares and $17m for the delivery
ofMJU-75 flares, both from our fully automated manufacturing facility in
Tennessee in support of the US DoD, and a £24m order for the delivery of
arange of countermeasure products in support of the UK MOD from our
facility near Salisbury.
The investment in the expansion and automation of our Tennessee facility to
meet the expected demand for airborne countermeasures continued during
the year. Having completed construction work of the buildings in FY21 and
commissioning and characterisation in FY22, FY23 saw the completion of
firstarticle testing and the first delivery of units to the customer.
The Countermeasures sector saw a greater weighting of its trading performance
and cash generation to the second half of 2023, following the delays to order
intake in 2022 following the extended US Continuing Resolution.
Revenue for Countermeasures & Energetics was up by 2% to £285.6m
(2022:£280.5m). The sector reported an underlying operating profit of
£50.5m (2022: £48.9m) as underlying operating margin increased to 17.7%
(2022: 17.4%), driven by the richer margin mix in our Energetics businesses.
On a constant currency basis revenue would have been up 4% to £290.4m
and operating profit would have been up 8% to £52.9m.
The statutory operating profit for the year was £48.8m (2022: £46.8m).
OPPORTUNITIES AND OUTLOOK
The Countermeasures & Energetics sector focus remains on maintaining and
growing the Group’s market-leading positions, in particular in the growing
markets for propellants and precision engineered energetic devices, and in
countermeasures for key platforms such as the F-35.
The Group’s niche propellant and devices businesses in Scotland and Chicago
are increasingly securing long-term contracts with customers, supporting
greater short and medium-term visibility and providing a framework for
long-term planning and investment decisions. Similarly, demand for high-quality
high explosives has enabled Chemring Nobel in Norway to work proactively
with its customer base on long-term contracting models, providing significantly
improved visibility.
As planned, we will continue to complete the process of modernisation and
automation across our sites. This is now embedded in our Countermeasures
sites and ourfuture focus will be on our Energetics facilities. The improved
market conditions for our Energetics businesses reflected in our order intake
and order book has presented a strong organic growth opportunity to
expand capacity at these sites in parallel with the planned modernisation to
capitalise on the long-term demand we are seeing. In June and November
2023, we announced a three-year investment programme through to FY26 at
a cost of approximately £120m which, when completed, is expected to generate
incremental revenue of circa £85m and incremental operating profit of circa
£21m per annum. Alongside this we will continue to invest in new product
development to ensure that our product portfolio remains highly relevant to
our customers and will continue the process of operational alignment to
share technology and manufacturing excellence across the Group.
The Countermeasures & Energetics order book at 31 October 2023 was up
51% to £751m (2022: £497m). The increase compared to the 2022 year-end
closing order book is largely attributable to the strong order intake across the
Energetics businesses whose customers are increasingly placing multi-year orders.
Of the 31 October 2023 order book, approximately £281m is currently expected
to be delivered in 2024, representing 90% coverage of expected 2024
revenue and approximately 71% of 2025 and 65% of 2026 revenue.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 33

SECTION 172 STATEMENT
RESPONDING TO OUR
STAKEHOLDERS’ NEEDS
SECTION 172 FACTOR KEY EXAMPLES PAGE
CONSEQUENCES OF ANY DECISION IN THE LONG TERM - Our purpose in action
- Investment case
- Business model
- Market overview
- Strategy
6
10
24
16
18
INTERESTS OF EMPLOYEES - Our purpose in action
- Stakeholder engagement
- Health and safety
- Our people
6
34
42
56
FOSTERING BUSINESS RELATIONSHIPS WITH SUPPLIERS,
CUSTOMERS AND OTHERS
- Business model
- Stakeholder engagement
- Market overview
- Strategy
- Ethics and business conduct
24
34
16
18
61
IMPACT OF OPERATIONS ON THE COMMUNITY
ANDTHEENVIRONMENT
- Introduction to sustainability
- Health and safety
- Environment
- Our people
38
42
44
56
MAINTAINING HIGH STANDARDS OF BUSINESS CONDUCT - Ethics and business conduct
- Corporate governance report
61
84
ACTING FAIRLY BETWEEN MEMBERS - Investment case
- Stakeholder engagement
- Corporate governance report
10
34
84
Section 172 (1) of the Companies Act 2006 requires the directors to act in
the way they consider, in good faith, would most likely promote the success
of the Company for the benefit of its members as a whole. In doing so,
section 172 requires the directors to have regard, amongst other matters,
tothe:
- likely consequences of any decision in the long term;
- interests of the Company’s employees;
- need to foster the Company’s business relationships with suppliers,
customers and others;
- impact of the Company’s operations on the community and environment;
- desirability of the Company maintaining a reputation for high standards of
business conduct; and
- need to act fairly as between members of the Company.
In discharging our section 172 duties the directors have regard to the factors
set out above and any other factors which we consider relevant to the
decision being made. We acknowledge that every decision we make will not
always result in a positive outcome for all of our stakeholders. However, by
considering the Company’s purpose, vision and values, together with our
strategic objectives and having a process in place for decision making, we
aimto ensure that our decisions are considered and proportionate.
Further details on how the Board operates and reflects stakeholder views in
its decision making are set out in the corporate governance report on pages
84 to 93. Further information on how the Board has had regard to section
172 matters during the year can also be found in the following sections of the
annual report:
Chemring Group PLC Annual report and accounts 202334

STAKEHOLDER ENGAGEMENT
WHY WE ENGAGE
Ensuring that we provide innovative solutions that meet our customers’
needs, efficiently and on time, is crucial to the delivery of our strategy and the
long-term success of the business. Understanding our customers’ needs can
only be achieved through regular interaction and collaboration.
HOW THE BUSINESS ENGAGES
- Regular meetings, teaming arrangements and engagement at all levels of
ourcustomers’ organisations
- Partnering with customers on a broad range of technology and product
development programmes
- Participating in industry forums and working groups, and hosting customer
visits to our sites
- Attending and exhibiting at selected trade shows, which enables high-level
interaction and the opportunity to brief customers on key product
developments and other initiatives
HOW THE BOARD ENGAGES
- The Group Chief Executive and President of our US operations support
our businesses through regular interactions with senior customer
representatives, and provide feedback to the Board
- External market updates and customer views are obtained to support
theBoard’s strategy review
- Our US Government Security Committee works closely with the US
Government to ensure that we operate in full compliance with our
SpecialSecurity Agreement and updates the Board on a regular basis
- Site visits enable the Board to develop a deeper understanding of our
products, technical capabilities and customer requirements
HOW WE MONITOR
- Order intake
- R&D expenditure
- Capital investment
- Process safety events
OUTCOMES
- Customer-focused inputs into the Group strategy
- Innovation and investment driven by customer requirements
- Collaborative, strategic customer relationships
- Improved customer satisfaction
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WHY WE ENGAGE
Our people are at the heart of our business. They are critical to the delivery
of our strategy and the future growth of the business. We recognise the
importance of attracting, developing and retaining the best talent, and the
need to provide a safe and inclusive environment where individuals can thrive.
HOW THE BUSINESS ENGAGES
- Regular all-hands meetings and team briefings
- Works councils, trade unions, representative bodies and forums which
support and connect people with shared characteristics or interests
- Our real-time employee engagement tool, “Employee Voice”, enables
employees to provide immediate and anonymous feedback on
developments within the business
- Publication of a monthly video blog by the Group Chief Executive,
regularlyfeaturing other members of the senior leadership team
- Publication of regular company notices and the in-house magazine,
Chemring-I, which features news and events from across the Group
- Development programmes and succession planning
HOW THE BOARD ENGAGES
- Monthly reporting to the Board on health and safety matters
- Output from Employee Voice is regularly provided to the Board
andsupplemented by periodic culture “check-ins” facilitated by an
externalconsultant
- Direct engagement with the Board’s nominated non-executive director,
Laurie Bowen, through meetings with employees from across the business
and at different levels of the organisation
- Board engagement with a wide range of employees during collective and
individual site visits throughout the year
- Board sets diversity targets and the Nomination Committee reviews
diversity initiatives, senior leadership succession plans and talent
development programmes
HOW WE MONITOR
- Employee Voice participation and positivity scores
- People-related data including retention rates and diversity statistics
- Safety performance indicators
- CEO pay ratio
- External ESG ratings
- Whistleblowing reports
OUTCOMES
- Development of people strategy and related investment
- Safe, healthy and motivated workforce
- Focus on diversity and inclusion
- Improved employee retention
- Attractive proposition for potential new employees
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CUSTOMERS EMPLOYEES
The Board recognises that positive interaction and collaboration with all of our stakeholders is essential to the delivery of sustainable long-term value.
Effective engagement allows the Board to understand relevant stakeholder views on material issues which may impact the business and helps to inform the
Board’s decision making. We engage with a wide range of stakeholders at the Board level, at a Group level and within our business units. In understanding what
matters to our stakeholders we are able to take this into account when setting our strategy and also in planning our day-to-day business operations. The
table below sets out how we engage with our key stakeholders.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 35

STAKEHOLDER ENGAGEMENT continued
WHY WE ENGAGE
The continued support of our shareholders is something that we value
greatly. We therefore recognise the importance of providing all of our
shareholders with regular updates on the Group’s operational and financial
performance, strategy and future prospects, and ensuring that shareholder
views are taken into consideration in relation to major developments in
thebusiness.
HOW THE BUSINESS ENGAGES
- Engagement with shareholders predominantly led by the Group Chief
Executive, the Group Finance Director and the Group Director of
Corporate Affairs
- Publication of our interim and full year results statements, along with
regular trading updates throughout the year
- Sustainability Report published on our website
- Face-to-face meetings or video calls following the publication of any
significant news update or at the request of the shareholder
- Formal presentations and structured roadshows for our institutional investors
following the publication of the Group’s interim and full year results
- Our website provides financial, business and governance information on
theGroup and an alerts service enables subscribing shareholders to receive
notification of corporate updates
HOW THE BOARD ENGAGES
- Board receives feedback collated by our brokers and other financial advisers
from our institutional investors, in which their views can be expressed on a
non-attributable basis
- Our Annual General Meeting provides the opportunity for our private
shareholders to hear from and engage directly with the Board
- The Chairman, the Senior Independent Director and Chair of the
Remuneration Committee meet with shareholders to discuss specific matters
HOW WE MONITOR
- Earnings per share
- Dividends paid
- Total shareholder return
- ESG metrics
- External ESG ratings
OUTCOMES
- Development of capital allocation and dividend policy
- Development of ESG strategy
- Supportive, long-term shareholder base
- Access to funding
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SHAREHOLDERS
WHY WE ENGAGE
We rely on our suppliers to provide us with quality raw materials, products
and services. Constructive engagement ensures that our suppliers are able to
meet our high expectations on safety, quality, value, delivery performance
andethical business conduct. We recognise that prompt payment terms and
strong supplier relationships are important in building a long-term, sustainable
and supportive supply chain.
HOW THE BUSINESS ENGAGES
- Day-to-day interaction with suppliers is conducted largely by supply chain
management teams within our businesses
- Long-term agreements are entered into with our key suppliers,
whichprovide visibility on future requirements and enable us to agree
performance targets to assist with our drive for continuous improvement
- All suppliers are issued with our Supplier Code of Conduct, which sets
outthe standards of ethical business conduct we expect of them
HOW THE BOARD ENGAGES
- Business continuity and supply chain dependency reviews included within
the internal audit programme
- Reports on supplier due diligence and compliance reviewed by the
ESGCommittee
- Annual consideration and approval of the Modern Slavery Act Statement
HOW WE MONITOR
- Payments made within payment terms
- Statistics on issue of the Supplier Code of Conduct and inclusion of
suppliers in the Chemring Compliance Portal
OUTCOMES
- Collaborative, long-term relationships
- Delivery of safe and reliable products and services to customers
- Appropriate working capital management
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SUPPLIERS
Chemring Group PLC Annual report and accounts 202336

WHY WE ENGAGE
We recognise the important role that each of our businesses play in their
local communities and we actively encourage our businesses to support local
initiatives and charitable causes. Equally, our businesses take pride in the
contribution that they make to their local communities, both as a local employer
and in the work they do to support good causes. We also recognise the
impact of our business on wider society and our responsibility to contribute
toa sustainable future for all.
HOW THE BUSINESS ENGAGES
- Our community investment policy confirms our commitment to support
selected charitable causes with a focus on the military and armed services,
STEM-related initiatives and those linked to the local communities in which
our businesses operate
- Each business has its own locally held charity budget and at a Group level
charitable donations are considered by the Executive Committee
- In addition to making cash donations, we also encourage and support
employees who undertake voluntary work in the local community
- Our people across the Group are involved with a number of educational
initiatives and as a business we have relationships with several universities,
whereby funding is provided for students’ research activities
- Sponsorship through the Horizons Bursary Scheme run by the Institution of
Engineering and Technology, which provides financial support during degree
study for students who have faced or continue to face adversity whilst they
study; these students are all studying STEM degree courses which are
relevant to the disciplines required within Chemring
- Implementation of environmental and carbon reduction initiatives
HOW THE BOARD ENGAGES
- Development of ESG strategy, objectives and targets subject to Board oversight
- ESG Committee, chaired by the Group Chief Executive, reports regularly to
the Board on ESG-related matters
- ESG-related targets included in the senior leadership annual bonus plan and
performance share plan
HOW WE MONITOR
- Charitable donations
- Environmental performance indicators
- External ESG ratings
OUTCOMES
- Development of ESG strategy
- Informed communities
- Contribution to local businesses and employment
- Contribution to wider society
- Sustainable business operations
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WHY WE ENGAGE
Our businesses operate in highly regulated environments and we need to
ensure that we maintain our licences to operate and continue to run our
businesses in full compliance with all laws and regulations. We also need to
keep ahead of planned regulatory developments which may impact our
operations in future.
HOW THE BUSINESS ENGAGES
- Maintenance of a regular dialogue with contacts within governments
andatour regulators
- Participation in industry working groups and trade representative bodies
- Consultation with local governing bodies on planned business developments
and investments
HOW THE BOARD ENGAGES
- Board oversight of our Code of Conduct, our Operational Framework
andthe associated assurance processes ensures our businesses are meeting
governmental and regulatory requirements
- Interaction with the US Board’s Government Security Committee provides
assurance to the Board that the business is operating in accordance with
our Special Security Agreement
HOW WE MONITOR
- Regulatory changes
- Compliance statistics
- Safety-related capital investment
OUTCOMES
- Ethical and compliant business conduct
- Trusted supplier to government customers
- Government support for proposed acquisitions
- Sustainable business operations
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COMMUNITIES AND THE ENVIRONMENT GOVERNING BODIES AND REGULATORS
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 37

INTRODUCTION TO SUSTAINABILITY
COMMITTED TO A
SUSTAINABLE FUTURE
“ Chemring acknowledges its responsibilities
to contribute to a sustainable future.
Wehave a strong and recognised
obligationto ensure the responsible
operation of ourbusiness and are fully
committed to long-term sustainable value
creation through safe, values-based and
ethical business conduct at all times.”
Michael Ord
Group Chief Executive
and Chairman of the ESG Committee
PURPOSE
Chemring helps make the world a safer place. Across physical and digital
environments, our exceptional teams deliver innovative technologies and
products that detect and defeat ever-changing threats.
VISION
To be a leading provider of critical and innovative technologies that detect
and protect people, platforms, missions and information against constantly
changing threats.
Improving our sustainability performance plays a key role in the way we both
run our businesses today and plan for the future, as we manage our ESG-related
risks. We also recognise that our ESG credentials are an increasingly important
factor in our ability to attract and retain first-class people. Engaged, motivated,
empowered and appropriately-skilled employees are integral to our success.
Whilst our approach to sustainability continues to mature we are committed
to implementing transparent policies and procedures, and to fostering an
inclusive culture across the Group where everyone does the right thing and
takes responsibility for their actions. Increasingly this focus will develop from
working as a trusted partner to our many customers and ensuring that our
internal standards are fit for purpose, to working with our supply chain to
ensure that they too work to the same standards. In doing so we will build a
sustainable company of which all our stakeholders can be proud, now and in
the future.
OUR APPROACH TO SUSTAINABILITY
The long-term success of the Chemring business can only be enhanced by a
positive interaction with all of our stakeholders and therefore a positive and
engaged approach to corporate responsibility and sustainability is important
to us. Our approach is focused around the following key areas:
- health and safety;
- environment;
- people;
- ethics and business conduct; and
- governance.
Our approach to corporate responsibility and sustainability is embedded
within the business units and all senior leaders have specific objectives
aroundthese areas identified which are linked to their incentive plans.
PROGRESS IN 2023
Chemring’s purpose is to help make the world a safer place and the ongoing
wars in Ukraine and Gaza continue to tragically highlight the critical role that
the defence and security industry plays in preserving peace, democracy and
freedom in the western world. It has reinforced the argument that for
sustainability to thrive, it requires global stability at its foundations. We
areproud of the role that Chemring plays in providing that stability and
areequally focused on ensuring that we manage and progress our own
sustainability agenda, and in particular our ESG-related risks.
ESG forms part of our everyday thinking, from how we run our businesses
from day to day, to long-term strategic planning. Climate-related issues, such
as emissions, are now addressed in every monthly Board report and ESG is
aregular, scheduled Board agenda item. It is also a standing agenda item for
every meeting of the Group’s Executive Committee and forms part of the
monthly reporting cycle of each of our business units.
2023 has seen us make further progress as we proactively manage our
sustainability agenda. Focus areas included health and safety, diversity and
inclusion, reducing climate change, and employee wellbeing. As a business
weare committed to building a sustainable company of which all our
stakeholders can be proud, both now and in the future.
It is pleasing that our efforts have been recognised externally. In 2023 we
were again given a rating of AAA by MSCI, putting us in the top 3% of the
Aerospace and Defence sector. Furthermore, in June 2023, the Group was
identified by Investec’s Sustainable Investment Research as a 2023 rising star.
Their research identified UK companies in the small and mid-cap market that
are demonstrating a growing commitment to ESG. They noted that Chemring
has the third most improved Bloomberg ESG score among all UK companies
below $5bn market capitalisation, with this improvement being mainly attributed
to better disclosure on social issues, where Chemring has gone from below
median in 2020 to leading its peer group.
Across the Group we continue to actively seek ways to reduce our impact on
the environment and build resilience to climate change by focusing on energy,
waste and water, and understanding the impact of global climate change on
our operations. These four focus areas have been identified based on an
overall evaluation of environmental impacts and risks, with a focus on impacts
that we can influence and have consequently influenced financial planning.
Chemring Group PLC Annual report and accounts 202338

PURPOSE IN ACTION
ENERGY AND MATERIAL SAVING PROGRAMMES
ACROSSCHEMRING
Improving our sustainability performance across Chemring plays a key role in
howwe run our businesses today and plan for the future. All Chemring businesses
have active sustainability programmes, both globally and locally, to reduce our
environmental impact. We are on a path to becoming net zero by 2030. Some
ofour projects include:
CHEMRING NOBEL, NORWAY
System for excess heat from the acid recovery process: In 2022, the team
introduced a new hot water system to heat new acid storage tanks, the raw
materials for nitration, and hot water for the filtration process. The system is
designed for further expansion of excess heat sources, and new sources for
heating have also been identified.
The energy saving equates to 0.85 GWh per year.
NEW COMPRESSOR FOR COMPRESSED AIR
In 2022, the old fixed-speed compressor was replaced by a new variable-speed
compressor with a proper drying system. The excess heat from the compressor
isused for heat tracing, the snow melt system, and to heat the filtration building.
The energy saving equates to 150-200 MWh per year.
STORAGE TANKS IN NORWAY
400V power supply to seawater/cooling water system: Work has started on replacing
the current 230V power supply to seawater and freshwater pumps with a 400V
supply. The pumps will be supplied with variable speed rather than fixed speed.
The energy saving equates to 80 MWh per year.
LINK TO STRATEGY
> READ MORE ON
PAGES 18 TO 19
LINK TO OUR VALUES
> READ MORE ON
PAGE 25
INNOVATION
21
We are setting Group targets, focusing on energy usage to drive further
improvements in this area. Our strategy is to reduce our global greenhouse
gas (“GHG”) emissions through improving energy efficiency to reduce
consumption and by purchasing electricity from renewable sources.
Many of our businesses have environmental management systems and have
undertaken local initiatives and programmes to reduce environmental impacts.
To improve energy efficiency, improvements across all facilities have been
undertaken, from installing new storage tanks to upgrading facilities to more
efficient variable speed pumps, heating, ventilation and air conditioning (“HVAC”)
systems, and general upgrades to buildings and refurbishment to improve energy
efficiency for heating and lighting at multiple locations. These portfolio-wide
activities have been supplemented by site-specific initiatives, such as upgrades
to storage tanks, water cooling pumps, and the use of electric vehicles. We
have also focused on waste management, with the two priority areas being
the reduction of waste generation and the reduction of waste sent to landfill.
Our efforts have resulted in a decrease of 31.2% in waste generation, with
only 10.9% (2022: 19.0%) going to landfill.
In 2021 we committed to becoming net zero for market-based scope 1
and2emissions by 2030 and working to be a net zero organisation by 2050.
Chemring’s definition of net zero is to reduce greenhouse gas emissions to
zero or to a residual level consistent with reaching net-zero emissions at the
global or sector level, and to neutralise any residual emissions by the net zero
target date, and any GHG emissions released into the atmosphere thereafter
with certified emission reductions. Our net zero commitments are in line with
the United Nations and SBTi definition. Against those longer-term targets we set
the near-term target of reducing scope 1 and 2 GHG emissions year-on-year,
with this being linked to remuneration and rewards across all our senior
teams. In 2023 we have continued to make good progress, reducing our overall
scope 1 and scope 2 market-based GHG emissions by 9.1% (2022:7.3%). We
have now reduced our scope 1 and scope 2 market-based GHG emissions by
15.7% against our FY21 baseline.
As our disclosure has increased, so has the need to ensure that the data that
we report to the market is accurate. We have in place an auditable framework
for our emissions reduction activities, with external subject matter experts
appointed to verify the data and to report to the Group’s Audit Committee.
A key focus for both the Board and the Group’s ESG Committee has been to
ensure that we not only actively manage our sustainability agenda in order to
meet the near and longer-term targets that were set in FY21, but that we
continually look for ways in which we can improve further. Next year we
willbe introducing a new environmental data platform to better assess the
environmental impacts of our operations.
In addition to our environmental performance management, this year has
seen us continue to progress our activities around diversity, equity
andinclusion (“DE&I”), and employee development and wellbeing.
Chemring is committed to ensuring that we are able to attract and develop
an appropriately diverse workforce. Our DE&I agenda has evolved this year,
moving from a 2022 initiative to business as usual. Our employees continue
tohelp us identify where we can improve across many aspects of the DE&I
agenda, whether it is focused on gender, ethnicity, neurodiversity or any other
characteristic that makes up our workforce. We see a diverse workforce
asakey enabler for continuing to innovate our products and services for
ourcustomers.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 39

INTRODUCTION TO SUSTAINABILITY continued
OUR SUSTAINABILITY GOALS
SUSTAINABILITY OBJECTIVES
SUPPORTIVE ACTIONS
ANDACTIVITY
FURTHER
INFORMATION
ENVIRONMENTAL
Respecting and protecting
our planet byactively
seeking ways to reduce
ourenvironmental impact
- Reduce our impact on the environment and build resilience
to climate change by focusing on energy, waste and water,
and by understanding the impact of global climate change
on our operations
- Challenge our business unit leaders to safely improve
operational, resource and energy efficiency and to minimise
environmental impact
- Invest in support of product development and production
techniques that meet our customers’ needs and support
their environmental goals
- Chemring will be net zero by 2030 (scope 1
and scope 2 market-based)
- Chemring is working towards being a scope
3 net zero organisation by 2050 and is
committed to supporting its value chain
- We will reduce our total direct (scope 1) and
indirect (scope 2) GHG emissions year on year
- We will continue to focus our efforts on
reducing energy consumption and on
embracing green technology
- We will target zero waste to landfill by 2030
> ENVIRONMENT ON
PAGES 44 TO 55
SOCIAL
The safety, wellbeing
anddevelopment of our
people is at the heart of
ourbusiness
- Maintain compliance with both internal and external
standards of safety and the wellbeing of our workforce
- Ensure that, in support of our wider commitment to ethnic
and gender diversity, our workforce represents the
diversity of the local communities we operate in
- Implement effective policies and procedures and continually
invest in support of operational excellence and the
development of our people
- Promote inclusion and diversity at all levels
- Promote fair employment and skills development
- We will set a recordable injury frequency
rate limit of below 1 in line with upper
quartile benchmark performance
- We will continue to work towards reducing
the risks of high-hazard events
- We will increase the proportion of women
in all senior management positions across the
business to at least 33% by 2027
> HEALTH AND SAFETY
ON PAGES 42 TO 43
> OUR PEOPLE ON PAGES
56 TO 60
GOVERNANCE
Conducting business in an
ethical andresponsible
manner at all times
- Operate with integrity and transparency andto the highest
ethical standards across all our businesses
- Ensure the highest standards of product safety and comply
with all relevant standards
- Promote a culture where everyone does the right thing and
takes personal responsibility for their actions
- Actively seek to increase representation of ethnicity and
gender on our Board, within our leadership teams and
across all our localities
- Protect information security and data privacy
- Maintain prudent and responsible financial and tax planning
and management
- We will aim to maintain compliance with the
UK Listing Rules on gender and ethnic
diversity on the Board
- All Chemring employees and third parties
acting on our behalf must comply with the
Chemring Code of Conduct, wherever they
are located in the world
> ETHICS AND BUSINESS
CONDUCT ON PAGES
61 TO 62
ICON GOAL DESCRIPTION
Good health andwellbeing Ensure healthy lives and promote wellbeing for all at all ages
Gender equality Achieve gender equality and empower all women and girls
Affordable and cleanenergy Ensure access to affordable, reliable, sustainable and modern energy for all
Decent work and economicgrowth
Promote sustained, inclusive and sustainable economic growth, full and productive employment
and decent work for all
Reduced inequalities Reduce inequality within and among countries
Responsible consumption and production Ensure sustainable consumption and production patterns
Climate action Take urgent action to combat climate change and its impacts
Peace, justice and stronginstitutions
Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build
effective, accountable and inclusive institutions at all levels
Chemring Group PLC Annual report and accounts 202340

PROGRESS IN 2023 continued
The Board has played an active role in supporting our DE&I activity with
Board members taking part in various employee round-table discussions
andnetworking events. Laurie Bowen, as the non-executive director with
responsibility for employee engagement on behalf of the Board and as Chair
of the Remuneration Committee, met with groups of colleagues from different
business areas and at different levels in the organisation. Laurie was able to
hear directly from these groups their views on working at Chemring, as well
as being able to share with them the work of the Board. These groups included
colleagues at all levels from operators to the senior leadership teams at Roke,
and Chemring Energetics UK in Scotland, as well as at Chemring Nobel in
Norway. The groups Laurie met were overwhelmingly positive about their
experiences of working at Chemring and pointed to many examples of
support from the Group. Laurie also gathered input as to how we can
continue to develop, and colleagues provided clear and constructive input
onareas such as enhancing cross-business collaboration which are being
actedon.
Our talent management efforts, resourcing strategies and development
programmes have all matured in 2023 and are focused on helping to create
the workforce we need both now and in the future. We see development
asnot only a strategic enabler to meet our business and customer needs,
buta key way in which we engage and motivate our employees. Established
Chemring development programmes include our two-year Early Careers
Programme, our supervisor focused “Leading our people” programme, and
our Aspire@Chemring programme which is designed to connect and equip
aglobal cohort of future senior leaders.
On the wellbeing side, we have continued to roll out a number of campaigns
to engage our global and diverse workforce, not just as individuals, but as
teams within their communities. The focus of this for 2023 was our “Around
Chemring in 80 Days” challenge. The challenge provided a platform for all our
sites to increase engagement with our workforce in health, leisure and
wellbeing activities, while sharing challenge-related stories globally and
promoting knowledge of our business units across the Group.
Our ESG strategy over the current and future years will seek to identify those
areas where our activities can have most impact. Plans are now in place to
continue this journey and to ensure that we meet the growing disclosure
requirements of our stakeholders and demonstrate our ability to successfully
address ESG-related issues.
We will also continue to work with our advisers and shareholders to identify
how we can constructively feed into and inform the debate on the future of
ESG reporting and the creation of a common set of standards against which
we can be measured. Chemring is now a business whose evolving purpose is
innovating to protect, and with that we are focused on protecting our
customers, people, platforms, missions and information.
As a business we remain fully committed to building a sustainable company
ofwhich all our stakeholders can be proud, both now and in the future.
PURPOSE IN ACTION
AROUND CHEMRING IN 80 DAYS CHALLENGE
During May to July 2023, teams from across the Group joined the
Around Chemring in 80 Days challenge.
The challenge invited teams of ten from all our businesses to travel
virtually to each of our Chemring sites, tracking their mileage as they
went. Team members clocked up miles by participating in any activity,
beit running, walking, swimming, yoga, or trampolining.
Actual miles achieved by each team were converted to “Chemring miles”
and tracked via a map showing when they reached the various
Chemringlocations.
43 teams took part in the challenge.
The main objective of this challenge was to motivate people to get
moving, improve their physical and mental health, and have some fun
with colleagues. Throughout the challenge, photos and activities were
shared across the Group, along with information about our businesses
and sites.
LINK TO STRATEGY
> READ MORE ON
PAGES 18 TO 19
LINK TO OUR VALUES
> READ MORE ON
PAGE 25
INNOVATION
21
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 41

HEALTH AND SAFETY
ESTABLISHING A STRONG
HEALTH AND SAFETY CULTURE
Our goal is zero harm, not as a statistical target but
as a moral imperative, whichwill be achieved by
establishing a strong calculative safety culture.
POLICIES AND PRACTICES
The Board recognises that the highest levels of safety are required to protect
employees, product users and the general public. The Board believes that all
incidents and injuries are preventable, and that all employees have the right to
expect to return home safely at the end of every working day. The Group
Chief Executive has overall responsibility for health, safety and environmental
(“HSE”) matters across the Group.
The Group HSE Director reports directly to the Group Chief Executive and
is responsible for the ongoing development and assurance of the Group’s
health, safety and environment strategy, known as our Journey to Zero Harm.
The Group HSE Director is a member of the Executive Committee and reports
on the performance of all businesses against agreed limits and objectives.
TheGroup Chief Executive reports monthly to the Board on all key HSE KPIs.
The Board requires that all businesses systematically manage their health and
safety hazards, set objectives and monitor progress by regular measurement,
audit and review. Each managing director is responsible for the implementation,
management and ongoing compliance of health and safety within their business,
and for providing adequate resources to satisfy the Board’s requirements. All
managing directors have health, safety and environmental-related objectives
incorporated within their annual incentive plan.
Managers and supervisors in the Group’s businesses are required to ensure
compliance with procedures, and to provide leadership and commitment to
promote and embed a solid calculative culture. The Board emphasises the
importance of individual responsibility for health and safety at all levels of the
organisation, and expects employees to report all hazards, to be involved in
implementing solutions and to adhere to the Fundamental Safety Principles,
which are underpinned by local rules and procedures.
A key element in the continuous improvement of health and safety management
is collaboration at all levels resulting in the sharing of best practice and lessons
learnt from incidents across the Group’s businesses and the wider industry.
Accidents, incidents and near misses are investigated, with actions generated
to prevent recurrence.
CONTROL OF MAJOR ACCIDENT HAZARDS
Our Countermeasures & Energetics businesses are required to manage
majoraccident hazards which are governed by stringent legislation within their
respective operating countries. Over the last four years, we have implemented
several processes to enhance our focus in this area by ensuring we design,
maintain and operate with integrity. We continue to invest in modern processes
and technology to remove our employees from exposure to energetic hazards.
During the design of these processes we have placed more scrutiny on the
application of process hazard analysis.
In 2019 we mandated that all Countermeasures & Energetics businesses
would need to conduct regular reviews to identify the potential for major
process safety events. The reviews are based on a “stress test” that addresses
the following questions:
- Have potential major accident hazards been identified?
- Are there effective controls in place to prevent and contain a major event?
- Are these controls being actively monitored?
This year saw a continued iteration of that review process, with an increase
inthe number of hazard scenarios being identified as the rigour of process
hazard analysis matured. As a result of this maturing process, we continue to
develop an understanding of our residual risks and throughout the year have
taken further steps to reduce these to a level as low as is reasonably practicable.
To help reduce our residual risks the implementation of a common computerised
maintenance management system continues to be rolled out across selected
businesses, improving management and accountability for safety-critical assets.
We continue to share best practice through the Technical Safety Committee,
Technical Learning Group and our quarterly “Shared Learning” events.
INJURY PREVENTION
Injury prevention focuses on the reduction of injuries through the adoption of
safety as an inherent part of everything we do. This is enacted through safety
leadership, clear expectations, accountability and establishing a safety culture
that drives learning and improvement, not blame.
This year we aligned our corporate incident reporting platform to the three
pillars of our HSE strategy, People, Plant and Processes, to better understand
the root causes of our incidents and where to focus our levels of assurance.
These additional data points will help our continued focus on becoming a
learning organisation. This data has reconfirmed trends regarding musculoskeletal
injuries due to the manual handling nature of some of our processes, together
with slips, trips and falls. The relevant businesses continue to manage these
risks whilst considering further automation.
ACHIEVEMENTS
This year has seen a continued focus on becoming a solid calculative
organisation, ensuring our systems create data-informed discussions and
decision making at all levels, withparticular focus on:
- control of major accident hazards;
- injury reduction; and
- HSE risk management.
Actions taken in delivering the HSE plan included:
- continued roll-out of the asset integrity management system;
- implementation of the electrostatic discharge protocols; and
- deployment of the Fundamental Safety Principles supported by the
Leadership Guide and the provision of training.
Chemring Group PLC Annual report and accounts 202342

HSE RISK MANAGEMENT
Safe delivery of our business continues through the management of risk and
isbuilt around understanding our hazards, and establishing clear expectations
and consistency. Our HSE Management System Framework Standard puts our
HSE policy into practice by setting standards on nine core elements across
the Group to drive a robust and common approach to the management of
HSE. Each business within the Countermeasures & Energetics sector is audited
annually to ensure compliance, with high-priority non-compliances being
reported and monitored at Executive Committee level. The changes made
in2022 to our Operational Assurance Statement process continue to help
the businesses focus on compliance with the HSE Framework which in turn
provides useful insights when planning the Line of Defence 2 (“LOD2”) audits.
Safe delivery of our business continues through the management of risk and is
built around understanding our hazards and establishing clear expectations
and consistency.
OUR HSE PERFORMANCE
We measure our HSE performance to reflect both occupational and process
safety. In doing so we have several data points, one of which is an external
review of our prevailing safety culture. Last year we invited back a team of
experts to review our progress. The review highlighted good progress as
wejourney towards becoming a high reliability organisation. The review
confirmed our businesses as approaching a Group-wide calculative status,
with robust processes and systems generating data and signals around our
high-hazard operations. The level of collaboration has also increased, with
many businesses sharing best practice on a regular basis to help accelerate
our performance, all of which is supported by a positive tone from the top
and underpinned by risk-informed, visible, and proactive safety leadership.
This year has seen a focus on supporting the leadership through the introduction
of the Leadership Guide and the provision of training support.
OCCUPATIONAL SAFETY
Our safety performance in terms of our total recordable injury frequency
(“TRIF”) rate is currently at 0.90, which shows a slight increase when
compared to last year’s 0.78 but remaining below our annual limit of 1.
Most injuries were caused by slips, trips and falls, or were musculoskeletal
innature.
We focus not only on actual injuries but also hazards and near miss events.
We therefore place an emphasis on near miss and hazard reporting as a
leading indicator of our maturing safety culture. This year we had 3,097
occupational safety near miss and hazard reports, compared to 2,828 in
2022. We had a total of 12 high-potential (“HIPO”) incidents compared to
13lastyear.
We are embedding this learning into the organisation through quarterly
Learning from Incidents reviews with all business leaders and increased use
ofSafety Alerts, not only to share incident learning but also as good practice.
PROCESS SAFETY
In addition to our reactive metrics we also measure process safety near miss
events, with a total of 1,559 recorded in 2023 compared to 880 in the previous
year. Near miss reporting is crucial if we are to understand and prevent
incidents , which is why we encourage all our employees to stop, warn and
inform so we can manage any emerging risks. The increase in near miss
reporting represents good progress as an organisation willing to learn and
improve on a continuous basis. During 2022 we consolidated the reporting of
our leading indicator for process safety events (“PSEs”), which are categorised
as level 1, 2 and 3, with 3 being the event with the most serious potential. We
set a limit of below 2 for PSEs at level 2 and 3 per 100 production employees.
This year we exceeded our limit with a PSE rate of 2.87 (2022: 1.86). Having
reviewed the data we believe this is down to improved reporting, due to a
better understanding of upset conditions, and higher levels of data assurance
with PSE events reviewed on a bi-weekly basis.
It should be noted that for the second year running there have been no
injuries associated with energetic events.
PURPOSE IN ACTION
SAFETY SCENARIOS HIGHLIGHT HAZARD HOT SPOTS
Across Chemring, we continue to make good progress on our Journey to
ZeroHarm whilst establishing a calculative safety culture.
During 2023, we launched and embedded our Chemring Fundamental Safety
Principles. Key to this is continuously providing safety training and communications
materials tailored to the Hazards our people are facing in Chemring. To do this,
we have created a series of targeted safety scenarios to allow our employees to
explore several different outcomes.
The safety scenarios are based on actual events that have occurred or have been
reported to prevent incidents. Our Occupational Safety, Health and Environmental
scenarios are linked to our Spot it, Stop it, Share it (“SSS”) campaign and our
Process Safety scenarios are linked to our Stop, Warn, Inform and Manage
(“SWIM”) requirements.
Each quarter, we issue a new safety scenario in a new format of animation for use
across Chemring. These animations have been a great way of sharing common
scenarios in one universal format across our businesses regardless of country,
culture, and language. These are posters or talked-through scenarios in training
ortoolbox talks.
The scenarios have been created dynamically, providing a new, tailored approach
for Chemring. They visually demonstrate how an unsafe condition and unsafe
actions can lead to a near miss, dangerous occurrences or ultimately, an accident.
LINK TO STRATEGY
> READ MORE ON
PAGES 18 TO 19
LINK TO OUR VALUES
> READ MORE ON
PAGE 25
INNOVATION
21
HSE STRATEGY FORWARD OUTLOOK
In 2023 we have continued to focus on maturing the plant and process
elements of our strategy through the continued delivery key programmes
such as the Asset Integrity Management Maintenance Systems and ESD
Protocols. Towards the end of 2023 we focused on the people element of
our strategy by introducing the Fundamental Safety Principles, with significant
focus on every employee’s duty to Stop, Warn, Inform, Manage (“SWIM”).
These themes will remain our priority throughout 2024.
Our progress against this strategy will be reported in the next annual report.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 43

ENVIRONMENT
REDUCING OUR
ENVIRONMENTAL IMPACT
Our goal of zero harm goes beyond the management
of safety. We are committed to environmental
sustainability, both globally and in our local communities,
and reducing our environmentalimpact.
OUR COMMITMENT
In 2021 we committed to reduce our total direct and indirect greenhouse
gas(“GHG”) emissions year-on-year and to be net zero by 2030. In this
report we include information on our climate-related risks and opportunities
in alignment with the recommendations of the Task Force on Climate-related
Financial Disclosures (“TCFD”). We have made good progress on our goals,
with an overall 15.7% reduction in scope 1 and market-based scope 2 emissions
from our 2021 baseline, and we have achieved a 9.1% year-on-year reduction
in 2023. We also have identified a path to become net zero by 2030. We
continue to make Carbon Disclosure Project (“CDP”) submissions and we
have developed the quality and range of scope 3 carbon emission data that
we report on with a clear path to reporting all material scope 3 emissions.
This work is overseen by our ESG Committee with regular progress reports
to the Board.
INTRODUCTION
Our environmental performance information is presented in accordance
withthe Streamlined Energy and Carbon Reporting (“SECR”) Guidance
(March 2019), as specified under the Companies Act 2006 (strategic report
and directors’ report) Regulations 2013. Data is presented for our financial
year, from 1 November through to 31 October, and includes information on
significant environmental aspects: energy consumption, associated GHG emissions;
freshwater use; and waste generation. Our GHG emissions calculations are
undertaken in accordance with the GHG Protocol Corporate Accounting and
Reporting Standard as outlined in our basis of reporting document, this can be
found on the Group’s website at www.chemring.com/basisofreporting23.
OUR APPROACH
We are actively seeking ways to reduce our impact on the environment
andbuild resilience to climate change by focusing on energy, waste and
understanding the impact of global climate change on our operations.
Thesefocus areas are periodically reviewed by our ESG Committee and
aredue to be reviewed and expanded on in 2024 inline with broader
sustainability goals and reporting guidelines.
OUR STRATEGY
Our strategy is to reduce our global GHG emissions through improving
efficiency to reduce consumption and waste.
- Scope 1 associated emissions are being addressed through the adoption of
green fuels and upgrading of facilities and equipment to be more efficient or
to use alternative greener energy sources.
- Scope 2 associated emissions are being addressed by implementing energy
efficient practices and upgrading facilities to aid in energy efficiency. We are
also using certified renewable energy through the acquisition of verified
REGO and REC certificates.
- Scope 3 emissions tracking continues to be developed and explored to
ensure we have a clear understanding of these emissions, so that we can
plan a clear and effective route to becoming a net zero organisation by 2050.
CLIMATE CHANGE RESILIENCE
We recognise that climate change has the potential to have an impact on our
operations, having experienced flooding from a severe weather event at our
Tennessee facility in 2018 and wildfires in areas surrounding our Australia
operations in 2019. In 2024 we are further developing our climate-related
scenario analysis to ensure our scenarios are accurate and up to date with
thelatest data, to ensure we are regularly reviewing the physical and
transition risks of global climate change on our operations and supply chain.
ENERGY USE AND ASSOCIATED GHG EMISSIONS FOR 2023
In 2023 we reviewed and updated our carbon reduction plans in all our
businesses to achieve our target of becoming a net zero organisation for
scope 1 and scope 2 market-based GHG emissions by 2030.
Location Scope 1
Scope 2
(market-based)
UK operations 76.19% -%
US operations 14.35% 89.54%
Norway operations 6.78% 10.46%
Australia operations 2.68% -%
100.00% 100.00%
In 2023 we achieved a 9.1% reduction in market-based scope 1 and scope 2
market-based GHG emissions, from 19,175 tCO
2
e in 2022 to 17,430 tCO
2
e in
2023. Location-based emissions have decreased by 0.95% in 2023, compared
to 2022. When normalised for gross revenue, market-based scope 1 and 2
emissions reduced 16.4%, from 43.3 tCO
2
e to 36.2 tCO
2
e per £m of revenue.
IMPROVEMENTS IN 2023
1) Storage tank upgrade project is estimated to save 700MWh of energy
and provide a reduction of 13.3tCO
2
e emissions per annum.
2) Upgrade of fixed speed 230V pumps for sea water/cooling water
system to a variable speed 400V pump is estimated to save 80MWh
of energy and provide a reduction of 1.52tCO
2
e emissions per annum.
3) System for return of condensate from a distillation column to feed a
tank for a steam boiler is estimated to save 1,500MWh of energy and
provide a reduction of 28.5tCO
2
e emissions per annum (project is
supported by Enova public funding).
4) General upgrade to buildings and refurbishment to improve energy
efficiency for heating and lighting at multiple locations reducing energy
use and CO
2
e emissions.
5) LED lighting replacement ongoing across the organisation.
6) Passive Infra-red Sensor (“PIR”) light controller installation ongoing
across the organisation.
7) Electric vehicle trials to start at one of our facilities with the aim of
reducing use of fossil liquid fuels in site vehicles resulting in an
estimated 21.08tCO
2
e of emissions reduction if the trial is successful.
8) Steam line insulation lagging replacement project is ongoing and will
reduce energy use and CO
2
e emissions.
9) Continued HVAC systems upgrades will reduce energy use and
CO
2
eemissions.
Chemring Group PLC Annual report and accounts 202344

2023 2022
UK
US, Norway,
Australia
Group
total UK
US, Norway,
Australia
Group
total
Scope 1 emissions – continuing operations
Combustion of fuel in any premises, machinery or equipment operated,
owned or controlled by the Group
CO
2
e (tonnes)
Gas 4,807 485 5,292 4,901 460 5,361
Heating oil 1,070 460 1,530 1,000 388 1,388
Bio fuels 2 — 2 1 — 1
LPG 49 186 235 39 239 278
Fuels consumed by Group-owned and leased vehicles, excluding business
travel and employee commuting
CO
2
e (tonnes)
Diesel 73 76 149 95 78 173
LPG — 25 25 — 25 25
Petroleum 2 217 219 — 216 216
The operation or control of any manufacturing process by the Group
CO
2
e (tonnes)
On-site waste incineration 23 225 248 26 160 186
Refrigerants discharged 2 211 213 25 518 543
Total scope 1 emissions CO
2
e (tonnes) 6,028 1,885 7,913 6,087 2,084 8,171
Scope 2 emissions – continuing operations
Total emissions CO
2
e (tonnes)
Electricity – location-based 2,483 12,174 14,657 2,426 12,372 14,798
Electricity – market-based — 9,517 9,517 — 11,004 11,004
Total scope 1 and 2 emissions – continuing operations
Location-based CO
2
e (tonnes) 8,511 14,059 22,570 8,513 14,456 22,969
Market-based CO
2
e (tonnes) 6,028 11,402 17,430 6,087 13,088 19,175
Total energy consumption (MWh) 44,581 86,151 130,732 44,361 87,478 131,839
We engaged ERM CVS to provide independent limited assurance of our 2023 total scope 1 and total scope 2 location-based GHG emissions data as well as
totalscope 2 market-based GHG emissions data. Their Independent Assurance Report can be found on pages 14 to 15 of our Sustainability Report 2023.
Thebasis ofreporting document can be found on the Group’s website at www.chemring.com/basisofreporting23.
2023 2022
Total scope 1 and scope 2 emissions CO
2
e (tonnes) – location-based 22,570 22,969
Total scope 1 and scope 2 emissions CO
2
e (tonnes) – market-based 17,430 19,175
Group revenue, continuing and discontinued operations (£m) 481.9 442.8
Total CO
2
e (tonnes) per £m of revenue – location-based 46.8 51.8
Total CO
2
e (tonnes) per £m of revenue – market-based 36.2 43.3
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 45

SCOPE 3 CARBON EMISSIONS DATA COLLECTION
This year we have expanded the collection of a subset of scope 3 emissions
incategories 1,3, 5 and 6:
- Category 1 Purchased goods and services; currently we collect data for
water supply.
- Category 3 Energy and fuel related activities.
- Category 5 Waste generated in operations and waste disposal;
wecollectemissions data based on destination.
- Category 6 Business travel; currently we collect data on air travel,
automotive hire and hotel usage in the UK, and air travel in the US.
Category
Tonnes CO
2
e
UK
Tonnes CO
2
e
US, Norway,
Australia
Tonnes CO
2
e
Group total
1 Water supply 26 16 42
3 Energy and fuel related activities 1,792 3,979 5,771
5 Waste generated in operations
and waste disposal 33 182 215
6 Business travel 872 500
*
1,372
* US air travel only.
We are reviewing the following categories and expect to start data collection
during FY24:
Category Coverage
1 Purchased goods and services Global
2 Capital goods Global
4 Upstream transportation and distribution Global
6 Business travel Global
7 Employee commuting Global
9 Downstream transport and distribution Global
WATER CONSUMPTION
In 2023 we used a total of 906,624m
3
of freshwater. This is a reduction from
2022 of 37,145 m
3
following improvements in leak detection and the repair of
water pipes in our Energetics facility in Scotland.
None of our operations are in water-stressed regions as defined by
theUnited Nations. Our Australian facility continues to collect and use
rainwaterthat falls on the site for facility needs.
ENVIRONMENT continued
PURPOSE IN ACTION
COMMITMENT TO ENVIRONMENTAL TRANSPARENCY
Chemring has furthered its commitment to environmental transparency
by disclosing its environmental impact through CDP, a global non-profit
that runs the world’s leading environmental disclosure platform.
In 2023, we completed CDP’s Climate Change submission.
With a record 23,000+ companies disclosing through CDP in 2023,
disclosing data on environmental impact is now a business norm. Our
data will be added to the most comprehensive inventory of self-reported
environmental data in the world – helping to drive action through
greater transparency. By disclosing through CDP, Chemring is prepared
to respond to the increasing demand for environmental transparency
from financial institutions, customers and policymakers. Inour climate
change submission, we shared information on a number of areas
including governance, risks and opportunities, business strategy,
targets,verification and breakdowns of emissions and energy data.
LINK TO STRATEGY
> READ MORE ON
PAGES 18 TO 19
LINK TO OUR VALUES
> READ MORE ON
PAGE 25
INNOVATION
21
2023 2022
UK
US, Norway,
Australia
Group
total UK
US, Norway,
Australia
Group
total
Freshwater (m
3
)
Freshwater use 236,288 670,336 906,624 437,274 506,495 943,769
Chemring Group PLC Annual report and accounts 202346

WASTE GENERATION
In 2023, efforts to improve efficiency and reduce waste across the business resulted in a 31.2% decrease in waste production from our businesses with only
10.9% of all waste going to landfill.
Our total hazardous and non-hazardous waste was 1,787 and 978 tonnes respectively. Of this, 73% of hazardous and 48% of non-hazardous waste was recycled.
Our total waste to incineration was 387 tonnes with 59% of the waste being incinerated for energy recovery. This is equal to 8% of all waste generated.
2023 2022
UK
US, Norway,
Australia
Group
total UK
US, Norway,
Australia
Group
total
Waste (tonnes)
Recycled, non-hazardous 134 333 467 129 1,064 1,193
Recycled, hazardous 40 1,271 1,311 59 1,302 1,361
Not recycled, non-hazardous 176 335 511 172 739 911
Not recycled, hazardous 117 359 476 36 517 553
Total waste (tonnes) 467 2,298 2,765 396 3,622 4,018
At our Countermeasures & Energetics businesses we generate unique waste which is often best managed by destroying it at on-site treatment facilities.
With respect to waste management there are two priority areas: the reduction of waste generation and the reduction of waste sent to landfill. To help improve
in these areas we are engaging with our end destinations of waste to ensure it is processed and treated in the best available method to ensure as little possible
goes to non-beneficial landfill. We aim to update our waste reduction plans as more detailed data from this engagement becomes available.
LAND QUALITY
Our facility in Chicago, US, is located on a site which has “superfund” status under the US contaminated land regime. The business continues to work with
consultants and the regulatory authorities to ensure that its legal obligations in relation to this matter are fully satisfied.
In 2023, we incurred costs in connection with environmental remediation of the sites of the munitions businesses formerly owned by the Group in Belgium
andItaly in accordance with the terms of sale of those businesses. The Group carries a £3.5m (2022: £3.9m) provision in respect of environmental liabilities,
which the Board considers to be adequate (see note 23).
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 47

TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES (“TCFD”) REPORT
The Task Force on Climate-related Financial
Disclosures (“TCFD”) establishes a number of
recommendations for disclosing clear, comparable
and consistent information about the risks and
opportunities presented by climate change.
The Board notes the recommendations in relation to the mandatory
disclosures of climate related financial risk arising from Listing Rule 9.8.6(8)
and has concluded that the business strategy is of Intermediate Resilience
given the mitigations already implemented and planned.
We consider our disclosure to be consistent with all the TCFD Recommendations
and Recommended Disclosures including section C of the 2021-TCFD Annex
entitled “Guidance for all Sectors” and section E of the TCFD Annex entitled
“Supplemental Guidance for Non-Financial Groups” excluding full completeness
of scope 3 emission (we currently report several categories in scope 3 but not
all) and cross-industry climate related metric categories of which we currently
report GHG Emissions and Remuneration from the cross-industry climate
metric categories. We are continuing to embed the relevant capabilities across
the organisation to track and disclose the complete data sets and metrics. In
2024, we will focus on developing our reporting of all scope 3 categories and
cross industry metrics, aspects and climate-related risk and strategies to enable
future disclosure.
Our statement to meet these requirements, providing information on the
governance of climate-related issues, integration with overall risk management,
strategy in managing climate-related issues and opportunities, and the metrics
to measure progress towards our targets, is set out in the following pages.
GOVERNANCE
BOARD OVERSIGHT OF
CLIMATE-RELATED RISKS
ANDOPPORTUNITIES
The Board is responsible for overseeing climate-related risks and opportunities in delivering the Group’s strategy andrunning
the Group’s operations. The Group Chief Executive is the Board director responsible for sustainability across the Group
which includes climate-related risks and opportunities. The Board reviews the Group Risk Register as a scheduled agenda
item every six months in which both physical and transitional climate-related-risks alongside opportunities are
considered. Progress of our decarbonisation strategy is embedded within our senior executives’ remuneration.
The ESG Committee ensures that appropriate climate and environmental systems are in place and remuneration is set as
necessary to aid the reduction in the Group’s environmental impact. Other elements, including associated action plans,
capital expenditure and budgeting and financial planning related to targets, are overseen and reviewed by the Board.
Further detail included on page 172.
During 2023, the Board and ESG Committee received updates on the development of our 2030 and 2050 targets, and
the initiatives to increase usage of green energy sources, reduce energy consumption and increase efficiency of energy
use, as well as improve the Group’s capability to monitor and measure carbon emissions.
The Board recognises that to meet our net zero goals we need to have a more robust and developed system to ensure
accurate data collection and monitoring, as well as strong working relationships with our supply chain.
> FURTHER DETAIL ON PAGES 38 TO 41
MANAGEMENT’S ROLE IN
ASSESSING AND MANAGING
CLIMATE -RELATED RISKS
ANDOPPORTUNITIES
To facilitate and ensure a centralised approach to sustainability across all our businesses, the Group ESG Committee
(consisting of members of the Group’s Executive Committee) was formed during 2021. The Committee is chaired by the
Group Chief Executive and has oversight of all the Group’s ESG-related activity including that of assessing and managing
climate-related risks and opportunities.
> FURTHER INFORMATION ON OUR GOVERNANCE STRUCTURE CAN BE FOUND ON PAGE 84
The Group Chief Executive, informed by the ESG Committee, is responsible for ensuring that the Board is updated
regularly on all key matters including the impact of climate-related issues. Members of the ESG Committee are informed
through their respective departments on matters relevant to climate-related issues.
Executive directors and members of the senior leadership team within the Group are incentivised to achieve the Group’s
carbon reduction targets through their annual bonus and long-term incentive plan (the Performance Share Plan (“PSP”)
as detailed on page 105 including results for the current year.
Chemring Group PLC Annual report and accounts 202348

STRATEGY
CLIMATE-RELATED RISKS AND OPPORTUNITIES IDENTIFIED OVER THE SHORT, MEDIUM AND LONG-TERM
MANAGEMENT’S ROLE IN
ASSESSING AND MANAGING
CLIMATE -RELATED RISKS
ANDOPPORTUNITIES
The risks and opportunities associated with climate are reflected in our strategy and plans, and we strive for continuous
improvement to reflect our purpose, our growth strategy, the external landscape and the expectations of our stakeholders.
Climate risks and opportunities, covering both physical and transitional aspects of climate change, were considered during
the year. Associated time horizons associated were viewed as short-term (0 to 2 years), medium-term (2 to 5 years), or
long-term (5 to 30 years). The basis for the time horizons was to align with our internal strategic and financial planning
processes. Short-term being the immediate budget period, medium-term covering the remaining detailed financial
planning period and long-term being outside of these periods. From this, the key risks and opportunities that could have
a material financial impact on the organisation have been identified. Where material, the Group is committed to managing
regulatory, reputational and market risk related to climate change.
We have set net zero and carbon zero targets. These carbon reduction ambitions will drive efficiency, innovation,
andcollaboration across our Group. We recognise and understand that our supply chain emissions are going to be
significantly larger than those of our scope 1 and 2 emissions, and it is critical that we accurately monitor and collaborate
with our suppliers to reduce our scope 3 emissions by 2050.
Our strategy to reduce carbon emissions encompasses material climate-related risks and opportunities that have the
potential to impact our business model and strategy over the short, medium and long-term taking into consideration
ourassets and infrastructure.
Details of the principal risks and uncertainties which could have a material impact on the Group’s business model,
strategy, future performance or reputation, of which climate change has been identified as a risk, are covered in the
principal risks and uncertainties section on pages 69 to 76.
To facilitate and ensure a centralised approach to sustainability across all our businesses, the Group ESG Committee
(consisting of members of the Group’s Executive Committee) was formed during 2021. The Committee is chaired by the
Group Chief Executive and has oversight of all the Group’s ESG-related activity including that of assessing and managing
climate-related risks and opportunities.
> CLIMATE-RELATED RISKS AND OPPORTUNITIES ARE OUTLINED IN MORE DETAIL ON PAGES 50 TO 55
THE BOARD
The Board oversees climate-related risks and opportunities affecting the Group, incorporating these considerations into the overall
strategy, including climate-related expenditures and investments. Certain responsibilities are delegated to Board committees.
Meets monthly
ENVIRONMENTAL, SOCIAL &
GOVERNANCECOMMITTEE
Oversees the Group’s ESG performance, monitors executive
progress in strategically addressing climate transition risks, and
ensures alignment with objectives and targets.
Meets every three months
GROUP HEALTH, SAFETY &
ENVIRONMENTDIRECTOR
Responsible for environmental strategy and assurance, including
climate-related aspects and the decarbonisation strategy. A key
member of the Executive Committee and ESG Committee,
providing regular updates on the environmental and net-zero
programme. Oversees the Environmental Policy, outlining the
commitment to addressing environmental impacts, including
climate-related issues.
BUSINESS UNIT
The local business units support the implementation of the
Group’s ESG strategy including climate change risk and are
responsible for the day-to-day compliance.
SUSTAINABILITY COMMITTEE
Co-ordinates the advancement of decarbonisation ambitions,
comprising functional representatives, business leads, and
environmental specialists. This group reports to the Group
Health, Safety & Environment Director.
Meets monthly
THE BOARD DELEGATES SPECIFIC ESG, INCLUDING CLIMATE CHANGE, OVERSIGHT TO ITS COMMITTEES
RISK MANAGEMENT
COMMITTEE
Oversees the implementation
of the risk management policy
and framework; identifies the
principal risks to which the
Group is exposed; monitors
risk mitigation plans;
andmaintains the Group
riskregister.
Meets every three months
EXECUTIVE
COMMITTEE
Manages climate-related risks
and opportunities, driving the
decarbonisation strategy
across the business and value
chain as part of the integrated
business planning process.
Meets bi-monthly
NOMINATION
COMMITTEE
Manages succession planning,
ensuring future skills for both
executive and non-executive
Board members, with a focus
on climate-related expertise.
Meets every six months
REMUNERATION
COMMITTEE
Determines the remuneration
policy, incorporating
long-term incentive plan
(“LTIP”) performance
conditions related to climate
change and other ESG
matters.
Meets every six months
INFORMING
INFORMING
INFORMING
REPORTING
REPORTING
REPORTING
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 49

TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES (“TCFD”) REPORT continued
THE RESILIENCE OF
CHEMRING’S STRATEGY,
TAKING INTO
CONSIDERATION
DIFFERENT CLIMATE-
RELATED SCENARIOS,
INCLUDING A 2°C OR
LOWER SCENARIO
In 2021/22 the Group began to develop its climate-related scenario analysis to improve understanding of the behaviour
of certain risks given different climate outcomes. In 2023 we expanded on our three public climate-related scenarios
which we deem to be reliable and related to our business operations to aid our understanding of the business’ resilience
to climate change. In 2024 we are further developing our climate-related scenario analysis to ensure our scenarios are
accurate and up to date with the latest data. We will revisit these scenario analyses to ensure these remain appropriate.
The scenarios are as follows:
- Sustainable Development (“SDS”)
1
, outlining a global low carbon transition which limits the global temperature rise to
1.65 °C by 2100, with 50% probability;
- Stated Policies (“STEPS”)
1
, outlining a combination of physical and transitions risk impacts as temperatures rise by 2.6°C
by 2100, with 50% probability; and
- RCP 8.52
2
, an extreme physical risk scenario, where global temperatures rise between 4.1 and 4.8°C by 2100.
Scenarios have been supplemented with additional sources that are specific to each risk to inform assumptions included
in projections. The Group continues to refine its approach to quantitative aspects of this modelling and will report
further information as this develops.
Assumptions have been made as part of this scenario analysis:
- Chemring will have the same business activities that are in place today. That means impacts should be considered in the
context of the current financial performance, prices and operational locations.
- Impacts are assumed to occur without the Company responding with any mitigation actions, which would reduce the
impact of risks.
- The analysis considered each risk and scenario in isolation, when in practice they may occur in parallel as part of a
wider set of potential global impacts.
- Carbon pricing was informed by the Global Energy Outlook 2021 report from the International Energy Agency (“IEA”).
> RESULTS OF THE SCENARIO ANALYSIS ARE OUTLINED ON PAGES 51 TO 55
1. IEA (2021), World Energy Model, IEA, Paris, https://www.iea.org/reports/world-energy-model.
2. IPCC, 2014: Climate Change 2014: Synthesis Report. Contribution of Working Groups I, II and Ill to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change.
RISK MANAGEMENT
ALL BUSINESS UNITS ARE REQUIRED TO ASSESS RISK IN RELATION TO THE DELIVERY OF THEIR STRATEGY AND OBJECTIVES, WITH
CLIMATE-RELATED RISKS FORMING PART OF THIS CONSIDERATION
CHEMRING’S
PROCESSESFOR
IDENTIFYING
ANDASSESSING
CLIMATE-RELATED RISKS
Current and emerging climate-related risks and opportunities are considered, whether they arise within the Group’s
operations or within the value chain, including existing and emerging regulations. In 2021/22, climate risks and opportunities
relevant to the Group were identified and reviewed with the aid of external consultants, and refined through consultation
with key Chemring personnel, including members of the ESG Committee, the Risk Management Committee and the Board.
Risks and opportunities were assessed in line with the Group’s methodology to assess principal risks. A probability and
impact matrix defines the likelihood of the risk, assessed based on historical evidence or experience that such consequences
have materialised (Very Unlikely, Unlikely, Neutral, Likely, Very Likely). The magnitude of impact is also classified (Low,
Low-Medium, Medium, Medium-High, High) and, where possible, a single figure estimate for the financial impact was calculated.
CHEMRING’S PROCESSES
FOR MANAGING CLIMATE-
RELATED RISKS
Once each climate-related risk and opportunity was identified, the Group sought to quantify the financial impact,
appropriate strategic response, and the cost of implementing the mitigations. This process includes considering the
long-term impacts arising from the risks identified on our products and services. This in turn helped to determine the
materiality, allowing the Group to prioritise resources to manage its most significant climate-related impacts, determine
the best management response or highlight areas requiring further investigation. All of the Group’s climate change risks
and opportunities are covered by existing or planned mitigation and adaptation strategies. Further detail set out in
Principal Risk and Uncertainties on page 69 to 76.
PROCESSES FOR
IDENTIFYING, ASSESSING,
AND MANAGING CLIMATE-
RELATED RISKS INTEGRATED
INTO CHEMRING’S OVERALL
RISK MANAGEMENT
Climate is considered as a Group principal risk alongside the risks identified in the wider risk management process.
Thisensures climate-related risks are integrated into the Group’s overall enterprise risk management framework.
The management of each business is responsible for the identification, management and reporting of local risks, in
accordance with the Group’s risk management framework.
The Risk Management Committee meets quarterly and, utilising the input from the business risk registers and the US
riskregister, identifies those principal risks which are material to the Group as a whole. The climate-related risks and
opportunities were reviewed by the Board during the financial year.
STRATEGY continued
CLIMATE-RELATED RISKS AND OPPORTUNITIES IDENTIFIED OVER THE SHORT, MEDIUM AND LONG TERM continued
Chemring Group PLC Annual report and accounts 202350

METRICS AND TARGETS
METRICS USED TO ASSESS CLIMATE-RELATED RISKS AND OPPORTUNITIES IN LINE WITH CHEMRING’S STRATEGY AND RISK
MANAGEMENT PROCESS WITH CLIMATE-RELATED RISKS FORMING PART OF THIS CONSIDERATION
SCOPE 1, 2 AND, IF
APPROPRIATE, 3 GHG
EMISSIONS AND THE
RELATED RISKS
Chemring monitors scope 1 and 2 emissions with aspects of scope 3 disclosed on page 45 to 46. The Group also
discloses other environmental metrics such as freshwater use and waste generated, as reported on pages 46 to 47.
CHEMRING’S TARGETS
FORMANAGING
CLIMATE-RELATED RISKS
AND OPPORTUNITIES
ANDPERFORMANCE
AGAINST TARGETS
As a crucial first step in Chemring’s approach to addressing climate-related risks and opportunities in FY21, Chemring set
appropriate near and longer-term sustainability goals, with targets against which our progress could be measured. These
included but were not limited to reducing our direct (scope 1) and indirect (scope 2) emissions year-on-year, to be net
zero by 2030 (scope 1 and 2 market-based) and to be net zero by 2050.
> EMISSIONS TARGETS FOR THE GROUP ARE OUTLINED ON PAGE 40
CLIMATE-RELATED RISKS
RISK: WILDFIRES
Type Physical
Area Own operation/Downstream/Upstream
Primary potential financial
impact
Loss of reputation, market share and revenue
Time horizon: short (0 to 2
years), medium (2 to 5 years)
or long-term (5to 30 years)
Short/Medium-term
Likelihood Likely
Magnitude of impact to
Group
Low impact
Est financial impact Not quantified
Est financial asset impact Not quantified
Est cost of response Not quantified
Description Wildfires pose a massive risk to individuals, communities, and businesses. Most organisations that experience a
fast-moving wildfire turn to ashes, or at the very least, are left structurally unsound and incapable of operational
continuity, the effects of which are felt by their communities on an economic and social level.
Impact Climate change imposes an increased risk to the likelihood and severity of wildfires which could have the potential to
disrupt production and product delivery due to physical damage to surrounding infrastructure and Chemring facilities, as
well as incurring additional costs of remediation. Such events also endanger Chemring’s personnel, who are a
fundamental priority to protect.
Mitigation Although none of the Chemring operations have been directly affected by wildfires, Chemring has initiated an enhanced
vegetation management programme for trimming and removing potential wildfire hazards surrounding our operations in
high wildfire threat areas and Chemring is aware of local mitigations in place such as planned burns.
Chemring business units seek to manage supply issues relating to unforeseen environmental risk through assessing supply
chain sustainability and ensuring where possible alternative suppliers are available for key or crucial parts or services.
Chemring is looking at energy supply to facilities with the potential for it to be affected by wildfires, with the ambition to
ensure back-up power systems are in place to ensure safe shut down and isolation in case of loss of power to the facilities.
Strategic change required No change required, continued monitoring and analysis as per normal operations.
Conclusion Using analysis conducted for the risk assessment of wildfires in Australia (the area in which the likelihood for the risk is
highest), differences in scenarios were analysed to understand the change in land annually exposed to wildfires in Victoria.
Looking at the worst-case climate change scenario (RCP 8.5), the median shifts by ~0.1% to the SDS scenario. The
minimal impacts from this risk are highlighted within the Australia region in the physical risks table (Table 1).
Resilience rating Intermediate Resilience
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 51

TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES (“TCFD”) REPORT continued
RISK: EXTREME WEATHER EVENTS
Type Physical
Area Own operation/Downstream/Upstream
Primary potential
financialimpact
Loss of reputation, market share and revenue
Time horizon: short (0 to 2
years), medium (2 to 5 years)
or long-term (5to 30 years)
Short-term
Likelihood Very likely
Magnitude of impact Low impact
Est financial impact Not quantified
Est financial asset impact Not quantified
Est cost of response Not quantified
Description Extreme weather events resulting from cyclones, earthquakes, storms, etc. will be intensified by climate change, having the potential
to impact Chemring’s operations the effects of which are felt by their communities on an economic and social level.
Impact Extreme weather events can cause disruption to supply chains across the globe as well physical damage to Chemring’s
facilities and could result in disruption to production and product delivery and impact overall revenue. Such events also
endanger Chemring’s personnel, who are a fundamental priority to protect.
Mitigation Operations deemed at risk of flooding from extreme weather events have had drainage improvements made with
further mitigations planned to reduce the impact of flooding type events.
Chemring business units seek to manage supply issues relating to unforeseen environmental risk through assessing supply
chain sustainability and ensuring where possible alternative suppliers are available for key or crucial parts or services.
Chemring is looking at energy supply to facilities with the potential to be affected by extreme weather events, with the
ambition to ensure back-up power systems are in place to ensure safe shut down and isolation in case of loss of power
tothe facilities.
Strategic change required No change required, continued monitoring and analysis as per normal operations.
Conclusion In looking at future scenarios, the physical risk of severe weather events remained localised to sites within the US. Even in
the RCP 8.5 scenario, the risk of expected damage from river flooding projected out to 2050 remains similar to scenario
SDS. This is also summarised within Table 1.
Resilience rating Intermediate Resilience
CLIMATE-RELATED RISKS continued
Chemring Group PLC Annual report and accounts 202352

RISK: TECHNOLOGY
Type Transition
Area Own operation/Downstream
Primary potential
financialimpact
Higher capex expenditure
Time horizon: short (0 to 2
years), medium (2 to 5 years)
or long-term (5to 30 years)
Medium/Long-term
Likelihood Unlikely
Magnitude of impact Low impact
Est financial impact Not quantified
Est financial asset impact Not quantified
Est cost of response Not quantified
Description Climate-related requirements are changing in key customer procurement contracts, which presents potential issues with
capability development, technology transfer or efficient manufacturing.
Impact This would influence expenditure, along with other potential impacts, including loss of contracts and disposal or write-off
of legacy/stranded assets, as well as aknowledge gap between the current systems and future systems affecting training in
skilled resource pool.
Mitigation In response to this risk, Chemring maintains continual assessment of government priorities in terms of technology
roadmaps and procurement requirements as necessary. Additionally, close relationships with customers are maintained
to facilitate effective risk management and long-term planning. Chemring is part of an industry working group to address
these new climate-related requirements.
Under the SDS scenario, the Ministry of Defence has outlined its approach to climate change and sustainability strategy.
Strategic change required No change required, continued monitoring and analysis as per normal operations.
Conclusion At present we do not expect this to affect the Group given the low amount of carbon emitted in the use phase of
products. Future procurement decisions may focus on the sustainability of a supplier’s business operations, for which
Chemring has an internal transitional plan for becoming a net zero organisation by 2050.
Resilience rating Intermediate Resilience
TABLE 1 – OVERALL PHYSICAL RISK IMPACTS SPLIT BY GEOGRAPHIC REGION AND SCENARIO ANALYSED (STEPS EXCLUDED DUE
TO DATA LIMITATIONS)
Site location
Scenario Australia Europe UK North America
SDS
RCP 8.5
Low impact Medium impact High impact
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 53

CLIMATE-RELATED OPPORTUNITIES
OPPORTUNITY: RESOURCE EFFICIENCY
Type Transition
Area Own operation
Primary potential financial
impact
Reduction in cost
Time horizon: short (0 to 2
years), medium (2 to 5 years)
or long-term (5to 30 years)
Short/Medium-term
Likelihood Likely
Magnitude of impact Low impact
Est financial impact Not quantified
Est financial asset impact Not quantified
Est cost of response Not quantified
Description Improvements to both product and energy efficiency will help to reduce waste, cost and CO
2
e emissions for operations.
Impact Chemring strives to employ the best available technology for its operations and ensures rigorous monitoring and maintenance of
facilities to maintain a high level of efficiency, along with initiatives such as upgrading building facilities. LED lighting retrofits have
the benefit of saving on direct energy costs. Plans for future initiatives are in place with planned financial savings.
Opportunity Opportunity for any future expansion or development within the business to implement energy efficient methods such
as heat pumps, LED lighting etc.
Strategic change required No change required, continued monitoring and analysis as per normal operations.
Conclusion This opportunity is largely unaffected by external changing policy scenarios, as future initiatives are already in place with
planned financial savings.
Resilience rating Intermediate Resilience
TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES (“TCFD”) REPORT continued
Chemring Group PLC Annual report and accounts 202354

OPPORTUNITY: LOW EMISSIONS ENERGY
Type Transition
Area Own operation
Primary potential financial
impact
Reduction in cost
Time horizon: short (0 to 2
years), medium (2 to 5 years)
or long-term (5to 30 years)
Short/Medium-term
Likelihood Very likely
Magnitude of impact Low impact
Est financial impact Not quantified
Est financial asset impact Not quantified
Est cost of response Not quantified
Description There are increased renewable energy with zero CO
2
e emissions options becoming available across the globe. With
improvements to technology, renewable energy is becoming increasingly inexpensive.
Impact Chemring will benefit from de-linking energy costs to fossil fuel prices through the procurement of renewable energy for
its sites. In addition, this will reduce the Group’s exposure to GHG emissions and thereby lower sensitivity to changes in
the cost of carbon.
The carbon price (US$/tCO
2
e) is projected to increase as follows:
Scenario 2030 2040 2050
STEPS 65 75 90
SDS 120 170 200
Difference 85% 127% 122%
Opportunity There is an opportunity to benefit from the emissions avoided by sourcing energy from fossil fuel-based providers.
Strategic change required Incorporating an internal carbon price assigns a monetary value to greenhouse gas emissions, empowering business units
to integrate this cost into investment decisions and daily operations. This utilisation of internal carbon pricing serves as a
strategic approach to effectively navigate climate-related business risks and proactively prepare for the shift towards a
low-carbon economy.
Conclusion Future scenarios that drive up fossil fuel prices such as the phase-out of subsidies (SDS) and incentives for clean energy transitions
such as those under the European Green Deal (STEPS) provide further impetus for procuring energy from more renewable sources.
Resilience rating Basic Resilience
RATING SYSTEM FOR IMPACT
1. LOW IMPACT
Definition: Low impact refers to climate-related risks or opportunities
that are anticipated to have a relatively minor effect on Chemring Group
PLC’s financial performance, resilience, reputation, or strategic direction.
Characteristics: These risks might have limited financial consequences,
manageable operational disruptions, or a relatively low level of exposure.
Conversely, low-impact opportunities may contribute modestly to
Chemring Group PLC’s overall strategy.
2. MEDIUM IMPACT
Definition: Medium impact signifies climate-related risks or opportunities
that have the potential to cause noticeable effects on Chemring Group
PLC’s financial performance, resilience, reputation or strategic direction.
Characteristics: Risks at a medium impact level may lead to moderate
financial consequences, more significant operational disruptions, or a
moderate level of exposure. Medium-impact opportunities can contribute
meaningfully to Chemring Group PLC’s strategy and performance.
3. HIGH IMPACT
Definition: High impact denotes climate-related risks or opportunities
that pose a substantial threat or benefit to Chemring Group PLC’s
financial performance, resilience, reputation or strategic direction.
Characteristics: Risks with a high impact level may result in significant
financial consequences, severe operational disruptions, or a high level of
exposure. High-impact opportunities have the potential to be transformative,
significantly influencing Chemring Group PLC’s strategy and performance.
RESILIENCE RATING
1. Basic Resilience: Limited formalised resilience strategies, reactive
approach to challenges, and basic contingency planning of climate-related
risks and opportunities, with limited integration into overall financial strategy.
2. Intermediate Resilience: Defined resilience strategies addressing key
risks, proactive measures in place, and a moderate level of integration
withbusiness operations, with a clear assessment of climate impacts on
the business, integration into strategic planning.
3. Advanced Resilience: Robust resilience strategies incorporating
comprehensive risk assessments, proactive adaptation strategies, and
strong integration with overall business strategies and a deep understanding
ofclimate-related risks and opportunities, well-integrated into financial
decision-making processes, and a commitment to continuous improvement
in line with evolving standards.
4. Exemplary Resilience: Industry-leading resilience strategies,
transparency, comprehensive scenario analysis, proactive adaptation
strategies, and a demonstrated commitment to driving positive climate
impacts with continuous improvement, innovation in risk management,
and a company-wide culture that prioritises adaptability and anticipates
emerging challenges. Setting a benchmark for best practices in TCFD reporting.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 55

OUR PEOPLE
INVESTING IN OUR PEOPLE
At Chemring our people are at the heart of
everything we do. We invest in our people at all
levels, across every location and function. This focus
ensures we have the right talent enabled to perform,
whatever the challenge.
The past few years have seen changes in all of our external talent markets,
from the effects of the COVID-19 pandemic changing people’s expectations
of work, leveraging the advantages of hybrid working where possible, through
to inflationary pressures and a higher cost of living for all our people. Ithas
made it more important than ever to ensure that we are focusing on our
people, delivering an employee experience that motivates and empowers our
workforce.
Chemring Group PLC Annual report and accounts 202356
CULTURE AT CHEMRING
Everything we do is underpinned by our culture at Chemring. As a group of
companies, we embrace what ties us together and respect what differentiates
us. Our principle of Global Voice, Local Accent defines the approach to investing
in our people to bring the best of our corporate programmes in areas such
astalent, development and a focus on engagement whilst ensuring our businesses
bring their local unique customs and practices to empower their workforce.
We have a values-based culture of Safety, Excellence and Innovation and 2023
saw an even greater focus on our safety culture through the launch of our
Fundamental Safety Principles supporting our goal of zero harm.
OUR POPULATION
Each and every business unit has a focus on the skills it needs from its
workforce to meet our customer commitments. Additionally, their focus
continues to be on the diversity of the talent coming into our organisation
toensure we have a healthy and vibrant mix of backgrounds, experiences
andperspectives to bring innovative ideas and support a mindset of
continuous improvement. Chemring strives for diversity on a broad basis
including gender, age, background, education, disability, neurodiversity and
OUR OVERALL PEOPLE APPROACH IS FOCUSED ON FIVE KEY AREAS:
HAVING THE RIGHT
TALENT READY
TOPERFORM
AN UNDERSTANDING OF
OUR TALENT PIPELINES
CLEAR LEADERSHIP AND
CAPABILITY DEVELOPMENT
PROGRAMMES
A FOCUS ON THE
ENGAGEMENT AND
RETENTION OF
OURPEOPLE
AN UNDERPINNING OF
DIVERSITY, EQUITY &
INCLUSION IN
EVERYTHING WEDO
THROUGH OUR CULTURE
AT CHEMRING
DIVERSITY, EQUITY & INCLUSION
LEADERSHIP
&CAPABILITY
DEVELOPMENT
CULTURE,
ENGAGEMENT
&RETENTION
TALENT
PIPELINES
LOCAL BUSINESS
IMPERATIVES
Employ, perform,
engage, retain
RISK REGISTER & STRATEGY
1
2
3
4
5
nationality (within the constraints of our regulatory requirements) and this
diversity brings a more agile, engaged and higher-performing workforce.
Gender diversity is one measure that we monitor throughout our population
and programmes. Our total global population in 2023 was:
2022
2023
71% (1,857) Male
29% (751) Female
71% (1,716) Male
29% (702) Female

STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 57
We benchmark both to our external local talent markets and to relevant
peers and will continue to consider how we can improve the diversity within
our organisation.
Our population has grown significantly in the past year and this change in
volume has driven a focus on maturing our people activities to ensure they
create a best in class employee experience for all colleagues, whether they be
recent joiners or those with longer service. One area of strategic focus is our
use of technology and data to drive people decisions. Where appropriate, we are
investing in HR systems at a business unit or regional level to streamline activity,
reduce waste and improve data quality. This approach also extends to
offering a modern “digital” employee experience where possible through
access to communications, employee information and even access to roles
available across the Group. Access and transparency are key to our approach
to creating a more digital employee experience.
PURPOSE IN ACTION
ASPIRE@CHEMRING – FIRST COHORT GRADUATION!
Earlier this year, the first cohort of the Aspire@Chemring talent development
programme successfully completed the course and graduated.
The programme started in May 2022 with the aim of preparing and
developing the future senior leadership of Chemring. The modules
weredesigned to help them develop the skills, best practices, and strong
leadership network they need to succeed.
A total of 75 people graduated from this first cohort, who had been
nominated for the programme by senior leaders.
The Aspire@Chemring programme is made up of six modules in total,
each delivered virtually by a mix of internal and external experts. The
first half of the course focused on leading human performance, with
thesecond half centred around leading organisational performance.
Chemring partnered with an innovative digital executive education
platform provider, which gave access to three top business schools to
provide the cohort with a series of elective modules from which they
could choose two. The modules were delivered by business school
partners (MIT, Tuck, and Columbia Business Schools), and the cohort
selected the modules which best aligned with their individual
development goals.
LINK TO STRATEGY
> READ MORE ON
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LINK TO OUR VALUES
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PAGE 25
INNOVATION
21
OUR TALENT PIPELINES
To create the diverse and broad employee population we need, we look at
anumber of pipelines both internally and externally. Our external talent
pipelines cover a broad range of sources, from direct hires into specific key
segments in our organisation, to early careers professionals who are yet to
discover their passions and find their home within the organisation. Additionally,
we take innovative approaches to creating pipelines where they traditionally
have not existed, such as the Roke Academy where those with a diverse and
varied work career are given the chance to retrain in the skills we need for
the future.
Our Early Careers Programme in the UK goes from strength to strength
witha record 145 early careers professionals going through our two-year
programme across our UK businesses. Bringing in a strong cohort of
apprentices and graduates each year helps us to grow our talent and
constantly challenges us to grow and listen to the next generation of
Chemring leaders.
Our focus on talent also extends to supporting the pipelines of talent to
move through our organisation. Our talent assessment activities are
centredaround the need to plan and develop to solve today’s challenges
andtomorrow’s opportunities. We actively seek how to create opportunities
for those experiences to be gained by our talent before they are needed.
One such programme is Aspire@Chemring which launched in May 2022
andran for 11 months. Aspire@Chemring was designed to connect a global
cohort of future senior leaders to develop some of the experiences required
at the highest levels of our leadership.
Where possible we also work in alignment with wider industry and government
organisations to increase the skills and mobility of talent into our organisations.
In the UK we have partnered with the Institute of Engineering and Technology
(“IET”) for the last five years to sponsor bursary students from disadvantaged
backgrounds to create opportunities for education which may previously not
have been open to them. This diversity of background brings a different
perspective, which is brought into Chemring through our IET bursary
students taking summer internships and permanent positions.
LEADERSHIP AND CAPABILITY DEVELOPMENT
Along with a focus on finding the best talent to join our organisation, we put
equal measures on developing from within to ensure we have the right skills
in the right place at the right time. Over the last few years, Chemring has
been able to create a series of programmes designed to support the needs
ofleadership at each level.
As well as our focus on leadership, it is equally important to invest in the
technical, operational and functional skills to deliver first-class products and
services. Our Countermeasures and Energetics businesses have been
focussing on maintaining operator competence in 2023 as a priority area
whilst Roke has been developing their professional & consultancy capabilities,
as a key enabler of their growth ambitions.
We see development as a strategic enabler for meeting our business and
customer commitments. We also see it as a key way in which we engage
ouremployees. All leadership proactively talk with their teams about their
aspirations, goals and development needs through processes such as Performance
Conversations - which reinforces how important each colleague’s contribution
is. Open conversations about performance help us focus on what individuals
need to be successful and allow development to be seen as a positive investment
of time and prioritised accordingly. This is a win-win for both our workforce
and our organisation.
Established Chemring programmes include our two-year Early Careers
Programme in the UK, and our supervisor-focused Leading Our People
Programme through to our Aspire@Chemring Programme which will
launchwith our second cohort in early 2024.

OUR PEOPLE continued
Chemring Group PLC Annual report and accounts 202358
PURPOSE IN ACTION
EARLY CAREERS CONFERENCE SUCCESS
In June, the Chemring People Team hosted the Early Careers Conference
as part of the Chemring Early Careers Programme. The in-person event
was held in Southampton, UK, and brought together 135 graduates and
apprentices from across Chemring Countermeasures UK, Chemring
Energetics UK and Roke.
One of the key benefits of the conference was the opportunity to
network with leadership team members and get first-hand career advice
and guidance while the cohort is still in the early stages of their careers.
The two-year programme combines virtual sessions throughout the
year and the face-to-face Early Careers Conference. The programme
has been designed to support our graduates and apprentices from
across Chemring’s UK businesses to build the foundational early
careerand professional skills needed in the workplace today.
One of the most important and valuable aspects of the Early Careers
Programme is being part of a community of colleagues at the same stage
in their careers. It enables members of the cohort groups to connect
across the different businesses and gain broader exposure to the entire
organisation while sharing skills and knowledge with peers.
LINK TO STRATEGY
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LINK TO OUR VALUES
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INNOVATION
21
LEADERSHIP AND CAPABILITY DEVELOPMENT continued
Additionally, we are fully engaged in the UK with the Apprenticeship Levy,
and maximise our levy fund to create apprentice level positions (48 active
apprenticeships in 2023) as well as to fund apprentice programmes for more
established colleagues in functional and leadership positions looking to further
develop their education.
ENGAGEMENT AND RETENTION
Our workforce is one of our key assets, and we work to ensure it thrives.
The external talent market is highly buoyant with industry turnover rates at
record levels. We are aware of the risk this presents and we never take our
workforce for granted. Employee experience and day-to-day engagement are
of the highest priority.
Listening to our colleagues is a fundamental leadership principle, both as
individuals and as an organisation. Our company-wide approach to continuously
listening to our colleagues is called Employee Voice. Through regular sentiment
surveys, our leadership teams are able to review how our employees feel
about working at Chemring. Our positivity score across the globe stands at
76% for 2023, compared to 75% for 2022. We will continue to review trends
at an organisational level to support our data-driven decision making, and
equally important, at the individual level.
There are many ways in which our colleagues are engaged with individually,
from one-to-one performance conversations to works councils and Employee
Resource Groups (“ERGs”). In many of our businesses, leadership make
themselves available through all-hands “town hall” meetings in which any
employee can raise questions.
Our Board is actively involved in understanding the needs and engagement of
the workforce. Laurie Bowen, Chair of the Remuneration Committee and the
non-executive director responsible for employee engagement on behalf of
the Board, meets with colleagues from different business areas and levels in
the organisation to hear their views on working at Chemring. In 2023, Laurie
visited three of our businesses that are focused on investment and growth:
Roke, Chemring Energetics UK and Chemring Nobel. This year, common
themes emerged, including the appreciation of leadership for communicating
how individual products and services support the organisation’s purpose of
building engagement; that safety is now an integral part of the culture of how
things are done; and that growth and investment are building pride across our
workforce. The groups identified specific opportunities to improve, which
were openly and constructively communicated; and summarised to the
leadership team for action.
Thanks to this feedback, our local leadership teams at these locations can
ensure that employee feedback informs and supports their growth agendas.
Employee feedback remains a key channel for insights into how we can shape
Chemring’s employee engagement priorities both at a local level and
Group-wide level.
Our local business ERGs, in particular, are helping us to understand “what
good looks like” in many areas of the inclusion agenda; one size does not fit
all.
This approach is how we focus on developing our culture so that it serves our
employees and our customers. We work to the principle of embracing what
ties us together and respecting what differentiates us. Our values driven
culture is based on our values of Safety, Excellence and Innovation and is
thefoundation all our businesses work to.
48
Apprenticeships currently in progress
145
Graduates and apprentices took part
inUK-wide Early Careers
Developmentprogramme
75
Experienced managers graduated from the
first cohort of Aspire@Chemring, our first
fully virtual leadership development programme
DEVELOPING OUR PEOPLE

STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 59
DIVERSITY, EQUITY AND INCLUSION (“DE&I”)
We have worked hard over the past 12 months to evolve our focus on DE&I
from an initiative to business as usual. DE&I underpins every process, action
and decision made in Chemring.
In FY23 we went back to basics to define what was important to focus on in
our drive to improve our gender balance in senior management positions.
Wedefined that it was important to capture all members of senior management
who influence the day to day employee experience and lead our culture. We
therefore tightened the definition of the population we monitor to ensure
that all these senior leadership positions continue to be developed towards
amore gender balanced and inclusive population.
Senior management positions are now defined as Executive/Senior Leadership,
Direct Reports to Executive/Senior Leadership (if in a leadership role) and
Key Positions holding a senior position or role of influence in the organisation.
This revised our baseline to 30% female and 70% male at the start of FY23,
on our way to our 2027 target of at least 33% female and 67% male.
Through this increased focus we saw our gender split in Senior Management
Positions increase across the year through a combination of active development
and promotion, turnover and hiring changes, growth of our positions of influence
in line with organisational growth and structural reorganisation efficiencies.
This resulted in a change in our gender balance to 32% female and 68% male
in this important population. We are therefore in an excellent position to
revisit the ambition of our gender targets in FY24 in line with our business
growth plans.
Furthermore, in 2023 we added the requirement for DE&I to be considered
within our five-year planning activities. Gender is not the only focus of our efforts.
Chemring strives for diversity on a broad basis including gender, age, background,
education, disability, neurodiversity and ethnicity (within the constraints of
our regulatory requirements). This is an area where we continue to develop
both globally and locally and which will be central to our success in the
coming years.
We continue to focus on ethnicity at the various levels within our organisation,
as a way of ensuring our workforce is reflective of the communities we are
situated in and operate within. Our reporting on ethnic diversity at Chemring is
set out in the table below.
OUR COMMUNITIES
In many of our locations, our employees are from the local community and
provide a valuable link to ensure we support those communities. This can be
through the form of open days where family and other community members
can gain insight into what we do at Chemring. It is also through our employees
volunteering their time both to community initiatives at to raising much
needed donations through charity events and challenges. Chemring fully
supports and celebrates all employees who go the extra mile to contribute
toour communities.
The education sector is another area of focus with the opportunity to
provide STEM sponsorship and support in local schools and colleges.
Asian
%
Black
%
Mixed race
%
White
%
Other
*
%
Senior managers 3.17 1.06 0.53 94.71 0.53
Mid-level managers 1.39 7.32 1.39 88.15 1.74
All other employees 4.26 13.28 1.71 76.65 4.10
* Including Hispanic, NHOPI, Native American.
Investingin this community helps us to build a broader and more diverse pool
of talent to join the engineering and defence sector in years to come.
In addition, we partner with charities that directly support those who are
endusers of our products and services. We honour the service that they
havegiven through the support to events such as “Ride with a Veteran”
and“The Big Sleep”.
PURPOSE IN ACTION
CREATING COMMUNITIES AND SUPPORTING INCLUSION
Across Chemring, our aim is to create a working environment where all
employees have the freedom, support, and trust to succeed. We want
everyone to feel able to bring their whole selves to work.
One way of helping us to feel comfortable and confident to be ourselves
at work and let our individual strengths shine is through connection with
other colleagues - whether that’s to connect over shared experiences,
or to understand different ways of thinking or ways of working.
One such way that Roke achieves this is through its Employee Resource
Groups (“ERGs”). The ERGs connect colleagues together around a
unifying mission, raising awareness of issues such as gender, ethnicity,
and sexual orientation.
At present, Roke has a total of eight ERGs - Women in Roke, Inspire
(LGBTQ+), Majority Ethnic, Veterans, Neurodiversity, Disability and
Regional Groups (grouping those regional groups and adding in Disability).
These groups provide opportunities for mentoring, volunteerism,
networking, development and community involvement.
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INNOVATION
21

OUR PEOPLE continued
Chemring Group PLC Annual report and accounts 202360
79% Male
21% Female
70% Male
30% Female
75% Male
25% Female
70% Male
30% Female
TOTAL GRADUATES AND APPRENTICES
COLLEAGUES INVOLVED IN LEADERSHIP DEVELOPMENT
PROGRAMMES IN 2023
56% Male
44% Female
87% Male
13% Female
68% Male
32% Female
62% Male
38% Female
87% Male
13% Female
76% Male*
24% Female*
BOARD DIRECTORS
EXECUTIVE COMMITTEE
SENIOR MANAGEMENT POSITIONS
2023
2023
2023
2023
2023
2022
2022
2022
2022
2022
2,270
colleagues with regular access to bespoke
Employee Voice pulse survey
34%
regular response rate of participants
inEmployee Voice
76%
positivity score
>4,500
individual comments and feedback received
LISTENING TO OUR PEOPLE
* 2022 split is based on prior year definition.

ETHICS AND BUSINESS CONDUCT
DOING THE RIGHT THING
Chemring is committed to conducting its business in
an ethical and responsible manner at all times, and in
full compliance with all applicable laws and regulations.
OUR APPROACH
We are committed to promoting a culture within Chemring where everyone
does the right thing and takes personal responsibility for their actions. Our
Operational Framework and Code of Conduct set out the standards of
business conduct and behaviours we expect of all of our businesses, our
employees and all third parties who act on our behalf. We require all
employees and third parties who act on our behalf to conduct business
honestly and with integrity, and to take personal responsibility for ensuring
that our commitment to sound and ethical business conduct isdelivered.
ESG COMMITTEE
The Board has established an ESG Committee, which has oversight of the
Group’s environmental, social and governance policies and objectives. The
ESG Committee, which was merged during the year with the Ethics & Compliance
Committee previously operated by the Group, is chaired by the Group Chief
Executive, with the other members being the Group HSE Director, the Group
Director of Corporate Affairs, the Group Financial Controller, the Group Legal
Director & Company Secretary and the Group Sustainability Lead. The
President of our US operations, our US General Counsel and our US Vice
President HSE also attend meetings by invitation. The ESG Committee has
oversight of the Group’s ethical business conduct and compliance framework,
including our anti-bribery processes. It monitors the implementation of the
framework across the Group and recommends areas for future improvement.
The Committee met four times during the year. At every meeting the Committee
reviews and monitors compliance with our anti-bribery processes and other
key compliance policies. During the year the Committee also reviewed:
- metrics on the due diligence and appointment of third party sales partners;
- statistics on the completion of compliance training; and
- approvals granted under our policy on sales to customers located in higher
risk territories.
The Group Chief Executive reports to the Board on the Committee’s
activities following each meeting.
OPERATIONAL FRAMEWORK
Our Operational Framework incorporates a broad range of more than 35
policies and procedures which have been adopted by all of our businesses.
The Operational Framework implements a robust governance
andcompliance framework toenable us to operate in a safe, consistent and
accountable way.
The leaders of each of our businesses are required to ensure that:
- every employee, at every level of the organisation, has access to and
understands the requirements of the Operational Framework;
- appropriate training and monitoring processes are in place to ensure proper
implementation of the Operational Framework; and
- local procedures and processes are adopted to implement the requirements
of the Operational Framework.
All of our Operational Framework policies, procedures and associated
training material are hosted on the Chemring Compliance Portal. This
innovative on-line system allows us to issue new and updated policies and
training to employees across the Group, targeted to their specific roles, and
enables us to monitor completion of mandatory training on a timely basis.
Our governance framework also includes a requirement for all businesses to
complete an Operational Assurance Statement on an annual basis, providing
adetailed assessment of their compliance with the Operational Framework.
The output from the operational assurance process enables us to drive
continuous improvement in our governance and compliance framework,
including the identification of additional training requirements for our
employees. It also allows us to monitor and address the evolution of a
number of the key risks we face, and provides valuable input to our internal
audit programme.
CODE OF CONDUCT
Our Code of Conduct, which sits alongside our Operational Framework,
embraces our fundamental values of Safety, Excellence and Innovation. It
provides direction to all employees on legal, ethical and risk issues that they
may encounter in their day-to-day activities.
All employees and all third parties who act on the Group’s behalf are
required to comply with our standards of behaviour and business conduct,
asset out within the Code, and applicable laws and regulations in all of the
countries in which we operate. All employees, current and new, are provided
with a copy of the Code of Conduct and asked to confirm that they will
adhere to its standards. The Code is reproduced in Norwegian for our
employees in Norway.
Updated scenario-based training on the Code was provided to employees
during the year.
OPERATIONAL
ASSURANCE
PROCESS
IDENTIFICATION OF
RISKS AND AREAS
OF IMPROVEMENT
CONTINUOUS
IMPROVEMENTS TO
THE OPERATIONAL
FRAMEWORK
IMPLEMENTATION
OF NEW
PROCEDURES
ANDTRAINING
PROGRAMMES
INTERNAL AUDIT
REVIEW AND
CONSIDERATION
OF FINDINGS
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 61
> DISCOVER MORE ABOUT OUR
CODE OF CONDUCT AT
CHEMRING.COM/
CODEOFCONDUCT

WHISTLEBLOWING
Our Chemring culture embraces transparency and openness, and we encourage
all employees to speak up if they have any concerns. We have a whistleblowing
policy and associated procedures in place which enable all employees to raise
concerns, in confidence, about possible improprieties or wrongdoing within
the business, without fear of reprisal or retaliation. Employees are able to
raise issues by contacting our 24-hour ethics reporting service by phone or
email or by accessing an external website. All issues reported are taken seriously
and investigated appropriately in a confidential manner. Third parties may also
access our ethics reporting services.
Our internal procedures on the handling of whistleblowing reports are
designed to ensure that all reports made, whether through the external
service or through other internal channels, are dealt with in a proper and
consistent manner, with appropriate oversight from the UK and US legal
departments. Training is provided to members of our leadership teams on
how to identify whistleblowing reports which may emanate through
less-obvious channels and how to engage with employees who make
whistleblowing reports.
ANTI-BRIBERY AND CORRUPTION
The Group has well-established anti-corruption policies, which are included
within our Operational Framework. Specifically, these cover bribery and
corruption, conflicts of interest, gifts and hospitality, and facilitation payments.
A number of other policies within the Operational Framework also address
bribery and corruption risks in areas such as finance, political donations and
lobbying, charitable donations and offset.
The Group has also adopted a policy on sales to customers located in higher
risk territories, which requires our businesses to prepare a risk mitigation plan
for any proposed transaction in a territory rated less than 50 on Transparency
International’s Corruption Perceptions Index. This plan is required to address
both bribery and corruption risks and broader risks which may be encountered
in doing business in such territories.
Our detailed anti-corruption procedures are incorporated within our Bribery
Act Compliance Manual (“BACM”), which is updated on a regular basis, and
includes requirements for:
- each business to routinely conduct informed bribery risk assessments as
part of normal operating procedures, to determine the nature and extent
of the Group’s exposure to potential internal and external risks of bribery
and corruption on its behalf by persons associated with it;
- approval of the appointment of all sales partners and other third party
advisers, which in all circumstances requires the completion of risk-based
due diligence, appropriate management approvals, use of standard form
contracts, and ongoing monitoring and review;
- risk-based anti-corruption due diligence processes for the engagement of
service providers and suppliers;
- regular mandatory training on BACM and its application to their respective
roles for management, supervisors and all employees working within
commercial, sales and marketing, finance and human resource functions
orin customer-facing roles;
- approval of the giving and receiving of reasonable, proportionate and
appropriate gifts and hospitality in the normal course of business; and
- proper identification, disclosure and management of potential or actual
conflicts of interest.
A BACM “Pocket Guide” is issued to all employees across the Group, which
provides an overview of our anti-corruption policies and the requirements of
the detailed manual.
All businesses are required to complete a BACM Compliance Certificate on
an annual basis, confirming that all policies and procedures within BACM have
been complied with and providing supporting information to demonstrate
compliance. BACM Compliance Certificates are reviewed by the ESG
Committee following each submission.
We recognise that the appointment of third party sales partners in our
routes to market can present particular bribery and corruption risks, and we
therefore implement enhanced anti-corruption procedures for the engagement
of sales partners where there is a genuine business need by mandating:
- restrictions on the number of sales partners to be engaged in each territory;
- the preparation of a full business case to justify the appointment of all new
third party sales partners, including a two-stage bribery risk assessment
incorporating the requisite level of risk-based due diligence, which must be
approved by the Group Chief Executive before the sales partner is appointed;
- due diligence reports from external consultants for higher risk appointments;
- a full periodic reappointment process for all retained sales partners,
including recommissioning of the appropriate risk-based due diligence
andresubmission of a full business case for approval by the Group Chief
Executive; and
- increased reporting requirements for all payments made to third party
salespartners and higher risk service providers.
The review and approval processes for our third party sales partners are
automated through the Chemring Compliance Portal, which enables us to
adopt a consistent approach to the application of our due diligence and
approval processes across the Group. Due diligence processes for the third
party service providers and higher risk suppliers engaged by our non-US
businesses are also managed in the Chemring Compliance Portal. The US
businesses have adopted a similar automated system in the US for their
service providers and higher risk suppliers.
The Chemring Compliance Portal also incorporates a module for employees
to seek approval on-line prior to giving or receiving gifts and hospitality, or
making charitable donations on behalf of the business.
Selected third party sales partners are subject to an independent audit by
anexternal consultant. These audits provide additional assurance on the
suitability of our sales partners and help to further strengthen our
anti-bribery and corruption processes.
Compliance with BACM procedures continues to be a core aspect of our
internal audit programme. BACM compliance audits were completed at three
businesses during the year.
HUMAN RIGHTS
The Group is committed to respecting human rights in the countries in which
we do business. Our Code of Conduct and other applicable policies under
the Operational Framework support our commitment to ensuring, as far as
we are able, that there is no slavery or human trafficking in any part of our
business or in our supply chain. All suppliers are provided with a copy of our
Supplier Code of Conduct, which requires them to adhere to our ethical
standards and expectations, including in relation to human rights. We do not
knowingly support or do business with any suppliers who are involved in slavery.
> A STATEMENT OF THE GROUP’S COMPLIANCE WITH THE MODERN
SLAVERY ACT 2015 CAN BE FOUND ON THE GROUP’S WEBSITE AT
WWW.CHEMRING.COM
We fully adhere to all relevant government guidelines designed to ensure
thatour products are not knowingly incorporated into weapons, or other
equipment, used for the purposes of terrorism, international repression or
the abuse of human rights.
ETHICS AND BUSINESS CONDUCT continued
Chemring Group PLC Annual report and accounts 202362

We delivered a result for 2023 that was slightly
ahead of the Board’s initial expectations, while
working hard to adapt to changing customer spending
priorities driven by global uncertainty and increased
demand for both technology-driven solutions and a
resurgent demand for traditional defence capabilities.
This has resulted in record order intake and provides
a strong outlook in the medium term.
FINANCIAL REVIEW
STRONG CASH GENERATION, FUNDING
INVESTMENTTOINCREASE CAPACITY
TODELIVEROURRECORD ORDER BOOK
Andrew Lewis
Chief Financial Officer
“ Our focus in 2023 has been on adapting to
our customers’ needs in what has been a
changing geopolitical landscape, demonstrated
by our plan to increase capacity in our niche
Energetics businesses over the next three
years while we continue to execute Roke’s
growth strategy.”
GROUP FINANCIAL PERFORMANCE
Order intake for 2023 was exceptionally strong in both segments, up 37%
to£756m (2022: £551m), with increasing demand in our niche Energetics
businesses, where order intake was up 161% to £358m (2022: £137m), and in
Sensors & Information, where Roke’s total order intake was £183m (2022:
£168m) as it continues to win work in a buoyant market.
Revenue was up 18% to £472.6m (2022: £401.0m) reflecting significant
growth in Roke and improved operational execution delivering strong
outputin our niche Energetics businesses.
On a constant currency basis the Group’s revenue was up 19% to £477.7m
(2022: £401.0m), underlying operating profit was up 21% to £71.7m (2022: £59.4m)
and underlying diluted earnings per share was up 12% to 20.7p (2022: 18.5p).
Foreign exchange translation has proved to be a headwind to revenue and
operating profit compared with last year. While exchange rates have been
volatile in the year, the US dollar, Australian dollar and Norwegian krone have
all weakened against sterling. A summary of the impact of the exchange rate
movements on the key metrics at a Group and sector level is shown in the
table below.
At constant currency As reported
2023 2023 2022
£m Change £m Change £m
Group
Order intake 772.7 40% 756.4 37% 551.5
Order book 964.5 48% 921.6 42% 650.9
Revenue 477.7 19% 472.6 18% 401.0
Underlying EBITDA 91.2 18% 88.5 14% 77.3
Underlying operating profit 71.7 21% 69.2 16% 59.4
Underlying diluted earnings per share (pence) 20.7 12% 20.0 8% 18.5
Sensors & Information
Order intake 215.1 10% 215.4 10% 195.2
Order book 172.2 12% 170.6 11% 153.7
Revenue 187.3 55% 187.0 55% 120.5
Underlying EBITDA 38.6 38% 38.5 38% 28.0
Underlying operating profit 34.3 35% 34.2 35% 25.4
Countermeasures & Energetics
Order intake 557.6 56% 541.0 52% 356.3
Order book 792.3 59% 751.0 51% 497.2
Revenue 290.4 4% 285.6 2% 280.5
Underlying EBITDA 68.1 6% 65.5 2% 64.2
Underlying operating profit 52.9 8% 50.5 3% 48.9
2022 comparatives have been re-presented reflecting the explosive hazard detection business as discontinued in accordance with IFRS 5; see note 5.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 63

GROUP FINANCIAL PERFORMANCE continued
The underlying operating profit of £69.2m (2022: £59.4m) resulted in an
underlying operating margin of 14.6% (2022: 14.8%). The Group margin
wasflat reflecting the continuing operating expense investment in Roke to
prepare it for further future growth which was partially offset by a richer
mixof higher margin Energetics business in Countermeasures & Energetics.
FY22
£59.4m
FY23
£69.2m
FY21
£49.2m
FY20
£43.2m
FY19
£34.7m
UNDERLYING OPERATING PROFIT (£m)
Total finance expense was lower at £1.3m (2022: £1.5m) reflecting the
continued focus on working capital management offset by the increase in
interest rates during 2023.
Statutory operating profit was £45.4m (2022: £49.4m) and after statutory
finance expenses of £1.3m (2022: £1.5m), statutory profit before tax was
£44.1m (2022: £47.9m). The statutory profit after tax from continuing
operations was £37.7m (2022: £44.4m) giving a statutory basic earnings
pershare from continuing operations of 13.4p (2022: 15.8p).
A reconciliation of underlying to statutory profit measures is provided in
note3. The non-underlying costs relate to the amortisation of acquired
intangibles, impairment of Chemical Detection assets, costs relating to
acquisitions, gain on the movement in the fair value of derivative financial
instruments and the tax credit associated with these.
As announced in November 2023, the explosive hazard detection division of
our US Sensors business has been treated as discontinued under IFRS 5 in
2023 and as a result all 2022 comparatives have been re-presented. A full
reconciliation of this is provided in note 5.
TA X
The underlying tax charge totalled £10.2m (2022: £4.6m) on an underlying
profit before tax of £67.9m (2022: £57.9m). The effective tax rate on
underlying profit before tax for the year was a charge of 15.0% (2022: 7.9%).
The charge in the previous year was reduced by a credit for the recognition
of a deferred tax asset in respect of future US interest deductions that were
previously unrecognised, which was not repeated in the current year. Looking
forward into 2024 we expect the Group effective tax rate to increase to
approximately 20%, reflecting the full year effect of the increase in the UK
corporation tax rate and an increased weighting of UK profits as Roke
continues to grow. Thestatutory tax charge totalled £6.4m (2022: £3.5m) on
a statutory profit before tax of £44.1m (2022: £47.9m).
EARNINGS PER SHARE FROM CONTINUING OPERATIONS
Underlying basic earnings per share from continuing operations was 20.5p
(2022: 19.0p) and diluted underlying earnings per share from continuing
operations was 20.0p (2022: 18.5p). Statutory basic earnings per share was
13.4p (2022: 15.8p) and statutory diluted earnings per share was 13.1p (2022 15.4p).
THREE-YEAR ROLLING CASH CONVERSION
101%
(2022: 108%)
ORDER BOOK
£922m
(2022: £651m)
WORKING CAPITAL
Working capital was £82.3m (2022: £93.9m), a decrease of £11.6m. As a
percentage of revenue, working capital has decreased to 17% (2022: 21%).
We continued with our focus on commercial contracting, inventory levels and
cash management. Year-end trade receivable days of 16 (2022: 17) and trade
payable days of 18 (2022: 18) demonstrate that working capital has been
managed in a balanced and sustainable manner.
GROUP FINANCIAL POSITION
CAPITAL EXPENDITURE
As announced during the year, the improved market conditions for our
Energetics businesses reflected in the order intake and order book has
presented a strong organic growth opportunity to expand capacity at these
sites in parallel with the planned modernisation to capitalise on the long-term
demand we are seeing. A three-year investment programme announced at
half year commenced during the second half of this year at a cost of
approximately £90m which, when completed, is expected to generate
incremental revenue of circa £60m and incremental operating profit of circa
£13m per annum. Inaddition to this, the Board approved additional capital
investment of an incremental £30m bringing the total investment programme
to £120m, which when completed is expected to deliver incremental revenue
of £85mand incremental operating profit of £21m per annum.
In the year £32.7m (2022: £31.5m) was spent on property, plant and
equipment which includes the commencement of the above-mentioned
programme as well as ongoing capital investment to continually enhance
safety and operational performance.
NET DEBT AND CASH FLOW
The Group’s net debt at 31 October 2023 was £14.4m (2022: £7.2m),
representing a net debt to underlying EBITDA ratio of 0.16x (2022: 0.09x).
Thefinancial health of the Group has continued to improve in a number of
aspects during the year. Disciplined working capital practices have been
maintained to reduce intra-period volatility, with working capital as
apercentage of revenue lower at 17% (2022: 21%). The Group is working to
achieve further improvements over the medium term.
UNDERLYING CASH CONVERSION (%)
100%
FY22
110%
FY23
90%
FY21
105%
FY20
110%
FY19
104%
Underlying operating activities generated cash of £80.0m (2022: £85.1m).
Underlying cash conversion was 90% (2022: 110%) of underlying EBITDA,
and an average of 101% on a rolling 36-month basis (2022: 108%).
FINANCIAL REVIEW continued
UNDERLYING DILUTED EPS (PENCE)
FY22
18.5p
FY23
20.0p
FY21
14.3p
FY20
11.8p
FY19
8.6p
Chemring Group PLC Annual report and accounts 202364

DEBT FACILITIES
The Group’s principal debt facilities comprise a £150m revolving credit facility
up to December 2025, of which £130m has been extended to December
2026, as well as a US$10m overdraft. The revolving credit facility was
established in July 2021 with a syndicate of six banks and there is one option
to extend for one year to December 2027. The $10m overdraft facility was
increased to $20m in November 2023. The Group had £142.9m (2022:
£136.7m) of undrawn borrowing facilities at the year end. The Group is
subject to two key financial covenants, which are tested quarterly. These
covenants relate to the leverage ratio between underlying EBITDA and net
debt, and the interest cover ratio between underlying EBITDA and finance
costs. The calculation of these ratios involves the translation of non-sterling
denominated debt using average, rather than closing, rates of exchange. The
Group was in compliance with thecovenants throughout the year.
RETIREMENT BENEFIT OBLIGATIONS
The surplus on the Group’s defined benefit pension scheme was £5.9m
(2022:£11.2m), measured in accordance with IAS 19 (Revised) Employee Benefits.
The surplus relates to the Chemring Group Staff Pension Scheme (the “Scheme”),
a UK defined benefit scheme whose assets are held in a separately administered
fund. The Scheme was closed to future accrual in April 2012. A full actuarial
valuation for the Scheme was completed as at 6 April 2021, and has been
updated to 31 October 2023, using the projected unit credit method. Despite
the volatility in equity and bond markets throughout the period and increased
inflation expectations, the resilience of the Scheme’s investment strategy,
which included a liability driven investment which hedged future interest rate
and inflation risk, has protected the Scheme’s surplus position which represents
110% of Scheme liabilities.
The 6 April 2021 triennial valuation showed a technical provisions surplus of
£3.8m, which represented a funding level of 104% of liabilities. The Group
agreed with the trustees that no further deficit recovery payments are required.
As at 31 October 2022, £2.0m was due from the Chemring Group Staff
Pension Scheme representing a short-term loan to fund margin calls on
liability driven investments which was repaid in November 2022.
On 28 November 2023 the trustees of the Scheme entered into a buy-in
contract with an insurer, Pension Insurance Corporation (“PIC”). The Group
has made an initial payment to the Scheme of £1.6m and expects to pay
c.£3m over the next two years as a contribution to the buy-in premium, to
provide funding for the rectification of certain members’ benefits and to meet
the costs associated with the initial buy-in and eventual buy-out of the
Scheme. On completion of the full buy-out of the Scheme, the defined
benefit assets and matching defined benefit liabilities will be derecognised
from the Group balance sheet.
CONTINGENT LIABILITIES
The Group is, from time to time, party to legal proceedings and claims, and is
involved in correspondence relating to potential claims, which arise in the
ordinary course of business.
In addition, one matter remained open at year end, being the incident that
occurred at the Group’s Countermeasures site in Salisbury on 10 August
2018. Full details are included in note 33.
RESEARCH AND DEVELOPMENT
R&D expenditure was £113.6m (2022: £79.7m). Continued investment in
R&D is a key aspect of the Group’s strategy, and levels of internally funded
R&D are expected to be maintained as investment in product development
continues, particularly within Sensors & Information. An analysis of R&D
expenditure is set out below:
2023 2022
£m £m
Customer-funded R&D 102.0 69.7
Internally-funded R&D:
– expensed to the income statement 10.1 7.5
– capitalised 1.5 2.5
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STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 65

ALTERNATIVE PERFORMANCE MEASURES (“APMs”)
In the analysis of the Group’s financial performance and position, operating
results and cash flows, APMs are presented to provide readers with additional
information. The principal APMs presented are underlying measures of earnings
including underlying operating profit, underlying profit before tax, underlying
profit after tax, underlying EBITDA, underlying earnings per share, underlying
operating cash flow and underlying cash conversion. In addition, EBITDA,
netdebt, underlying operating profit and revenue on a constant currency
basis are presented which are also considered to be non-IFRS measures.
These measures are consistent with information regularly reviewed by
management to run the business, including for planning, budgeting and
reporting purposes and for its internal assessment of the operational
performance of individual businesses.
A reconciliation of underlying measures to statutory measures is
providedbelow:
CONSTANT CURRENCY
2023
£m
2022
£m
Growth
%
Revenue (as reported) 472.6 401.0 18%
Effect of using prior period
foreignexchangerates 5.1
Revenue at constant currency 477.7 401.0 19%
Underlying operating profit
(asreported) 69.2 59.4 16%
Effect of using prior period
foreignexchangerates 2.5
Underlying operating profit
at constant currency 71.7 59.4 21%
2023 2022
Underlying
Non-
underlying
Statutory Underlying
Non-
underlying
Statutory
Group – continuing operations:
EBITDA (£m) 88.5 (20.8) 67.7 77.3 (6.1) 71.2
Operating profit (£m) 69.2 (23.8) 45.4 59.4 (10.0) 49.4
Profit before tax (£m) 67.9 (23.8) 44.1 57.9 (10.0) 47.9
Tax charge (£m) (10.2) 3.8 (6.4) (4.6) 1.1 (3.5)
Profit after tax (£m) 57.7 (20.0) 37.7 53.3 (8.9) 44.4
Basic earnings per share (pence) 20.5 (7.1) 13.4 19.0 (3.2) 15.8
Diluted earnings per share (pence) 20.0 (6.9) 13.1 18.5 (3.1) 15.4
Group – discontinued operations:
(Loss)/profit after tax (£m) (0.9) (31.4) (32.3) 3.5 (0.5) 3.0
Sectors – continuing operations:
Sensors & Information EBITDA (£m) 38.5 (22.2) 16.3 28.0 (1.2) 26.8
Sensors & Information operating profit (£m) 34.2 (23.5) 10.7 25.4 (3.0) 22.4
Countermeasures & Energetics EBITDA (£m) 65.5 — 65.5 64.2 — 64.2
Countermeasures & Energetics operating profit (£m) 50.5 (1.7) 48.8 48.9 (2.1) 46.8
We present a measure of constant currency revenue and operating profit.
This is calculated by translating our results for the year ended 31 October 2023
at the average exchange rates for the comparative year ended 31 October 2022.
The Group manages its finance costs and tax on a central or regional basis
and therefore the Board believes the use of underlying operating profit or
EBITDA is the best way of monitoring the performance of operating businesses.
The strategic report includes both statutory and adjusted measures, the latter
of which, in management’s view, reflects how the business is managed and
measured on a day-to-day basis. Our APMs and KPIs are aligned to our strategy
and together are used to measure the performance of our business and form
the basis of the performance measures for remuneration. Adjusted results
exclude certain items because, if included, these items could distort the
understanding of our performance for the year and the comparability
between the periods.
Management considers non-underlying items to be:
- amortisation of acquired intangibles;
- discontinued operations;
- exceptional items, for example relating to acquisitions and disposals,
restructuring costs, impairment charges and legal costs;
- gains or losses on the movement in the fair value of derivative financial
instruments; and
- the tax impact of all of the above.
Our use of APMs is consistent with the prior year and we provide comparatives
alongside all current year figures. The directors believe that these APMs assist
with the comparability of information between reporting periods as well as
reflect the key performance indicators used within the business to measure
performance. The term underlying is not defined under IFRS and may not be
comparable with similarly titled measures used by other companies. All profit
and earnings per share figures in this strategic report relate to underlying
business performance (as defined above) unless otherwise stated. Further
details are provided in note 3.
The adjustments comprise:
- amortisation of acquired intangibles of £3.0m (2022: £3.9m);
- costs relating to acquisitions, including deferred consideration treated as an
expense under IFRS 2, of £3.7m (2022: £2.0m);
- impairment of Chemical Detection assets of £18.5m (2022: £nil);
- gain on the movement in the fair value of derivative financial instruments of
£1.4m (2022: £4.1m loss);
- tax impact of the adjustments above: £3.8m credit (2022: £1.1m credit); and
- discontinued operations in respect of the explosive hazard detection
business in Sensors & Information, net of tax, of £31.4m (2022: £0.5m)
which includes an impairment of goodwill and other assets.
Andrew Lewis
Chief Financial Officer
12 December 2023
FINANCIAL REVIEW continued
Chemring Group PLC Annual report and accounts 202366

RISK MANAGEMENT
MANAGING RISK
RISK MANAGEMENT ORGANISATION
The Board is responsible for determining the nature and extent of risks it is
willing to accept in delivering the Group’s strategy and running the Group’s
operations, and ensuring that risk is effectively managed across the Group.
The Board reviews the Group risk register on a regular basis and considers
whether the Risk Management Committee has appropriately identified the
principal risks to which the Group is exposed.
The Audit Committee is responsible for reviewing and monitoring the
effectiveness of the Group’s systems of internal control, including financial,
operational and reporting controls, and its risk management systems. The
Audit Committee also reviews the effectiveness of the Group’s internal
auditarrangements.
The Risk Management Committee is responsible for overseeing the implementation
of the Group’s risk management framework and is alsoresponsible for identifying
the principal risks to which the Group is exposed, monitoring key mitigation
plans and maintaining the Group risk register. The Risk Management Committee
also reviews risks at the business unit level and considers input from the US
Risk Management Committee, which has been constituted to oversee risk
within the US operations.
The current members of the Risk Management Committee are:
- Michael Ord (Group Chief Executive);
- Bill Currer (President, US);
- Sarah Ellard (Group Legal Director & Company Secretary);
- Andrew Lewis (Chief Financial Officer); and
- Steven Messam (Group HSE Director).
RISK MANAGEMENT POLICY AND FRAMEWORK
The Group’s risk management policy sets out the Group’s approach to risk
management, including its risk appetite; the framework for assessing, managing
and monitoring risk within the business; and the key roles and responsibilities
for the oversight and implementation of the Group’s risk management
systems and controls.
The Group’s risk management framework draws fundamentally from the
“Three Lines of Defence Methodology”, with the “First Line” being day-to-day
management of risk and maintenance of effective control procedures at individual
businesses. The “Second Line” comprises a range of risk management and
control functions established at the corporate management level, which are
designed to enhance and monitor the First Line. The “Third Line” comprises
the Group’s internal audit function, which reports directly to the Audit
Committee, and assurance and audit reviews by external auditors, specialist
consultants and regulators.
APPROACH TO RISK MANAGEMENT
The management of each business is responsible for the identification,
management and reporting of local risks, in accordance with the Group’s
riskmanagement framework. The management of each business is also
responsible for the maintenance of business risk registers and the
implementation of mitigation plans.
Each business is required to maintain a risk register identifying their key risks.
The risk registers include an analysis of the likelihood and impact of each risk,
before and after mitigation actions are taken to manage the risk, together
with details of the mitigation plans and progress against them. Each risk is
allocated an owner, who has responsibility for managing the risk.
The business risk registers are updated locally on a quarterly basis and
arereviewed in detail by the Group Chief Executive, the US President, the
Chief Financial Officer and other members of the Executive Committee at
quarterly business review meetings with each of the businesses. The US Risk
Management Committee also reviews the risk registers for the US businesses,
considers US corporate-level risks and maintains a consolidated US risk register.
The Risk Management Committee meets quarterly and, utilising the input
from the business risk registers and the US risk register, identifies those
principal risks which are material to the Group as a whole. The Risk Management
Committee also considers corporate-level risks and emerging risks, as
referenced below. These risks are collated on the Group risk register,
together with details of the applicable mitigation plansand risk owners.
KEY ROLES AND RESPONSIBILITIES FOR THE GROUP’S RISK
MANAGEMENT STRATEGY
THE BOARD
- Overall responsibility
forrisk management
- Defines the Group’s
riskappetite
We continue to manage key risks to ensure the
delivery of the Group strategy.
RISK MANAGEMENT
COMMITTEE
- Oversees the
implementation of the
Group’s risk management
framework
- Monitors compliance with
the Group’s internal
controlsystems
- Maintains the Group
riskregister
BUSINESS
MANAGEMENT
- Responsible for the
implementation of the
Group’s risk management
framework at the
operational level
- Maintain business unit risk
registers and provide
input to the Risk
Management Committee
- Responsible for compliance
with internal controls
AUDIT COMMITTEE
- Reviews the effectiveness
of the Group’s risk
management framework
and systems of
internalcontrol
- Oversees the
effectiveness of the
Group’s internal
auditarrangements
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 67

APPROACH TO RISK MANAGEMENT continued
The Group has implemented an Operational Framework, incorporating
abroad range of policies and procedures which are required to be adopted
by all businesses. An annual operational assurance process isafundamental
part of the Operational Framework and provides an assessment of compliance
with the Operational Framework policies acrossthe Group. The output of
the operational assurance process provides additional visibility on risks across
the Group and is utilised by the Risk Management Committee as a further
input to the Group risk register. The operational assurance process also
provides assurance to the Board that the Group’s internal systems and
controls are operating effectively.
The full Group risk register is reviewed by the Board on a half-yearly basisand
key individual risks are reviewed at every Board meeting.
KEY AREAS OF FOCUS DURING THE YEAR
During the past year, we have continued to enhance our risk management
systems, with specific focus in the following areas:
- Our HSE Management Framework has been updated and we have issued
new Fundamental Safety Principles to all employees across the Group. We
have continued to improve on the shared learning of findings from all
significant incidents.
- We have further enhanced our HSE data collection and reporting through
our EcoOnline system.
- Additional IT and cyber-security standards have been implemented, and
wehave partnered with industry-leading managed detection and response
providers to monitor our systems and networks and respond to cyber
threats on a 24/7 basis. Cyber incident response workshops have also been
held.
- We have further improved our succession and talent management
programmes to address increasing resource demands and constraints.
- We have made good progress on improving business continuity plans
acrossthe Group.
- Climate change risks have been considered as key risks to the future
operation of the Group.
- Our internal audit programme has continued to incorporate thematic
reviews in key risk areas.
PRINCIPAL RISKS
The current Group risk register comprises risks in seven key risk areas,
covering health, safety and environment risks, strategic risks, financial risks,
operational risks, people risks, legal and compliance risks, and reputational risks.
> DETAILS OF THE PRINCIPAL RISKS ARE SET OUT ON PAGES 69 TO 76
EMERGING RISKS
The current UK Corporate Governance Code requires the Board to undertake
a robust assessment of the emerging risks that may impact the Group in the
future. This requirement has been reflected in the Group’s risk management
processes and emerging risks are considered by the Risk Management
Committee when compiling the Group risk register.
Emerging risks are identified through discussions with both external and
internal subject matter experts and other stakeholders, including customers
and regulators, and through horizon scanning of future developments in areas
relevant to the Group’s business operations.
Certain emerging risks relating to future technological, regulatory and
macro-economic changes are reflected on the Group risk register and
mitigation plans implemented accordingly. However, other emerging risks
havealso been identified, where we are still endeavouring to determine the
potential impact on the Group.
RISK REVIEW
The Board carries out an annual review of the effectiveness of the Group’s
systems of internal control and risk management systems. As part of this
review the Board considers:
- the operational and financial reports received from the executive
management throughout the year;
- the Group risk register and the mitigation actions being taken to manage
key risks;
- output from the operational assurance process; and
- internal audit reports and reports from the other assurance processes in
place across the Group.
The Board confirms that there is an ongoing process for identifying, evaluating
and managing the principal risks faced by the business, and that robust systems
of internal control and risk management were in place throughout the year
under review and have remained in place up to the date of approval of these
financial statements.
The Board acknowledges, however, that the internal control systems can only
provide reasonable, not absolute, assurance against mismanagement or loss of
the Group’s assets. The Board therefore continues to take steps to embed
internal control and risk management further into the operations of the
Group, and to address any areas for potential improvement which come to
the attention of management and the Board.
The Board carried out an assessment of the principal and emerging risks to
which the Group is exposed as part of its half-yearly review of the Group risk
register. The Board considered whether all applicable risks had been adequately
captured in the Group risk register and whether the requisite progress had
been made on the mitigation actions to address significant risks.
A
A
B
K
K
L
L
H
H
F
F
G
G
D
D
C
C
B
J
J
I
I
E
E
Low
Impact
Medium High
Low Medium
Likelihood
High
Occupational and process safety
Environmental laws andregulations
Climate change
Market
Political
Contracts
Technology
Financial
Operational
People
Cyber-security
Compliance and corruption
RISK HEAT MAP
The heat map below illustrates the relative inherent and residual positioning
of our principal risks from an impact and likelihood perspective.
RISK MANAGEMENT continued
Chemring Group PLC Annual report and accounts 202368

As our businesses continue to evolve, so does the risk landscape in which they
operate. The table below summarises the changes to the Group’s principal
risks and uncertainties during the year, identifies whether the trend in the risk
profile from the Group’s perspective increased, decreased or remained stable,
and provides an indication of the future outlook.
PRINCIPAL RISK/
UNCERTAINTY
WHAT HAS CHANGED AND THE FUTURE OUTLOOK
A Occupational and
process safety
Over the last few years, the level of reporting and investigation of process upset conditions has continued to improve, and we continue
totake further actions to put in place mitigations to reduce the likelihood of occurrence of energetic events. In addition, we have
strengthened our asset integrity programme and continue to drive improvements through the sharing of learnings from significant
incidents. We also continue to invest in new automated production systems and improve process controls for our legacy operations.
Our total recordable injury frequency rate increased slightly to 0.90 in 2023, compared to 0.78 in 2022, but, remained below our Group
limit of 1.0. Most injuries were caused by slips, trips or falls, or were musculo-skeletal in nature. There were no injuries sustained from
energetic ignitions during the year nor in the prior year.
We hope to see further improvements in process safety in 2024 as we continue with our capital investment and asset integrity programmes.
B Environmental
laws
andregulations
Environmental risks continue to increase with the increased focus on climate change and the environmental impact ofour businesses.
As part of our ESG strategy, we have implemented a more centralised approach to the management of our environmental performance,
recognising that minimising our environmental impact and addressing climate change-related risks is becoming increasingly important. We
continue to improve our reporting capabilities to help us effectively monitor the environmental impact of our businesses and to identify
priorities for investment and allocation of resources.
The ESG Committee is responsible for oversight of the Group’s ESG programmes and monitoring of progress against the Group’s
ESG-related strategic objectives. During 2023, a new Group Sustainability Lead was appointed to support various projects designed
tohelp reduce the Group’s carbon footprint.
The sale or closure of several sites during recent years has reduced the Group’s overall exposure to environmental risks. However, we
retain a financial liability for environmental remediation of certain sites formerly owned by the Group, most notably those occupied by
the divested munitions businesses in Belgium and Italy. The risks and mitigations associated with these exposures continue to be
monitored and managed.
Over the last year, there has been an increased level of focus by regulatory authorities in Europe and the US on the risks associated with
pre- and polyfluoroalkyl substances (“PFAS”) and the open burning of energetic waste. We continue to monitor developments in these
areas and the potential implications for our manufacturing facilities.
C Climate change
We continue to review and monitor the climate change-related risks most likely to impact the Group’s operations, further details of
which are set out on pages 44 and 55. Climate change-related risks and the potential impact of changed weather patterns on our
operations are identified as principal risks on the Group risk register and are monitored by the ESG Committee.
At the business unit level, our businesses have in place local risk registers and business continuity plans, which help to identify and mitigate
potential risks associated with flooding, storms, wildfires and changes to weather patterns. The businesses continue to review scenario
planning as part of their business continuity plans to identify potential risks and the mitigations which might be put in place.
D Market
Ongoing conflicts, particularly in Eastern Europe, continue to shape the threat environment, with a resurgence in demand for classical
kinematic capabilities, alongside growing information advantage and intelligence requirements. However, economic pressures may
continue to place defence spend under pressure.
E Political
Political tensions across the world continue to increase the risk of disruption in our non-NATO markets.
We continue to focus our business development and sales and marketing activities on our home markets and their allied countries.
F Contracts
The implementation of the Operational Framework has significantly increased our visibility on commercial and contracting practices
across the Group, and is enabling us to manage contractual risk exposures more effectively.
G Technology
Innovation is one of our core values and our technology-led development programmes continue to be a significant area of focus.
In 2023, Roke continued to see strong growth in its R&D service activities. The Roke Futures business unit continues to focus on
capturing opportunities for Roke’s capabilities in the commercial sector.
Chemring Sensors & Electronic Systems in the US continues to develop its innovative biological detection systems, which can identify
threats more rapidly and cost effectively than existing solutions.
We also continue to embrace technology to improve our operations and manufacturing processes.
PRINCIPAL RISKS AND UNCERTAINTIES
RISK MANAGEMENT IN ACTION
CHANGE IN RISK PROFILE
INTHE YEAR
Increasing
Stable
Decreasing
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 69

PRINCIPAL RISK/
UNCERTAINTY
WHAT HAS CHANGED AND THE FUTURE OUTLOOK
H Financial
The Group’s revolving credit facilities were extended to December 2026.
Our bank covenant of net debt: EBITDA was 0.21 at the year end, well within the covenant limit of 3.0x.
The businesses continued to face challenges associated with inflationary cost increases and higher energy prices during the year but on
the whole, these were able to be managed.
The risks associated with funding of the legacy UK defined benefit pension scheme continued to reduce during the year following the
de-risking of the scheme’s investment portfolio. At the year end, the scheme was £5.9m in surplus (on an IAS 19 basis). The triennial
actuarial valuation of the scheme was carried out as at April 2021 and confirmed that the scheme was £3.8m in surplus at that date. Since
the year end, the trustees of the scheme have secured a buy-in of the scheme’s liabilities with an external insurance company.
I Operational
We continue to invest in plant automation and modernisation of facilities across the Group in order to mitigate a range of operational
and safety risks. We have also implemented a Group-wide asset integrity programme to improve the resilience of our operations.
Operations commenced at our new automated countermeasures manufacturing facilities in Tennessee during the year.
Significant new capital investment projects at our Energetics facilities in Scotland, Norway and the US were approved during the year.
Seepages 30 to 33 for more details.
J People
Resourcing continues to present a challenge for a number of our businesses, particularly in parts of the US where buoyant demand in the
employment market makes it more difficult to recruit and retain employees. We also continue to face shortages of engineers and skilled
maintenance personnel.
Salary inflation also continued to impact a number of our businesses during the year.
A new Group HR Operating Model was deployed during the year and its effectiveness continues to be monitored. Wealso
continuedtomake good progress on delivery of our development initiatives, with the first cohort of 75 employees having completed
theAspire@Chemring programme and over 140 employees having participated in our Early Careers Programme.
We continue to focus on communications using a wide range of formal and informal challenges, both at the corporate level and within
individual businesses.
The deployment across the Group of Employee Voice continued to enable us to monitor employee sentiment and provides employees
with an opportunity to give feedback on changes as they occur.
The Group made further progress on meeting its gender diversity target during the year, with 32% of senior management positions now
held by females.
K Cyber-security
Whilst we have an ongoing programme to address IT and cyber-security risks, the threats in this area are increasingly more
sophisticated,relentless and adaptive. We continuously assess and evolve our cyber-security programme to detect and
respond to threats and vulnerabilities.
During the year, we determined that it would be appropriate to split the risk associated with cyber-security into two discrete risks - one
associated with cyber-security compliance and the other relating to our cyber incident response preparedness, in order to help monitor
mitigation actions for both risks more effectively.
Further significant progress was made towards achieving compliance with the Chemring Cyber-Security Standard at a number of
businesses during the year. The Group requires all businesses to implement a set of controls, based on cyber-security best practices,
which are designed to promote good cyber hygiene and safeguard information.
L Compliance and
corruption
The Operational Framework and the associated operational assurance process continues to ensure that we effectively manage legal and
compliance risks across the Group.
Our Group-wide on-line compliance system, the Chemring Compliance Portal, is now fully embedded within the businesses. The portal
hosts our Operational Framework policies and associated training material, and the system also helps to automate our anti-bribery processes.
The strategic risks associated with compliance with our Special Security Agreement with the US Government remain stable.
CHANGE IN RISK PROFILE
INTHE YEAR
Increasing
Stable
Decreasing
PRINCIPAL RISKS AND UNCERTAINTIES continued
RISK MANAGEMENT IN ACTION continued
Chemring Group PLC Annual report and accounts 202370

HEALTH, SAFETY AND ENVIRONMENT RISKS
A. OCCUPATIONAL AND PROCESS SAFETY
Risk and potential impacts Mitigation actions/factors
The Group’s operations involve energetic materials that
by their nature have inherent safety risks.
- Incidents may occur which could result in harm to
employees, the temporary shutdownof facilities or
other disruption to manufacturing processes.
- The Group may be exposed to financial loss, regulatory
action and potential liabilities for workplace injuries
andfatalities.
Example key risk indicators:
- Total recordable injury frequency rate
- Number of process safety events
- Number of near miss reports
- Safety reinforced as a core value.
- Continued emphasis on the “Journey to Zero Harm”
and promotion of a culture which puts safety first and
encourages employees to take personal responsibility
for their actions.
- HSE Strategy and HSE Management System
Framework Standard fully implemented within
thebusinesses.
- Robust major accident hazard analysis process to
identify, evaluate and mitigate significant process
safetyrisks, adopted across the Group.
- New asset integrity standard adopted.
- New Group-wide standard on management of
electro-static discharge hazardsintroduced.
- Incident investigation and crisis management
standardsadopted.
- Process established for Group-wide review of
learningsfrom significant incidents.
- Technical Safety Committeeestablished.
- Fundamental Safety Principles issued to all employees.
- “Spot It, Share It, Stop It” campaign instigated to
increase focus onnear miss identification and reporting.
- Continued programme of capital investment in older
facilities toimprove safetyandreliability.
> SEE ALSO: HEALTH AND SAFETY ON
PAGES42TO 43
Inherent risk: High
Risk appetite: Low
Trend: Stable
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Safety
Excellence
Innovation
B. ENVIRONMENTAL LAWS AND REGULATIONS
Risk and potential impacts Mitigation actions/factors
The Group’s operations and ownership or use of real
property are subject to a number of federal, state and
local environmental laws and regulations. At certain sites
currently or formerly owned or operated by the Group,
there is known or potential contamination for which
there is, or may be, a requirement to remediate or
provide resource restoration.
- The Group could incur substantial costs, including
remediation costs, resource restoration costs, fines
andpenalties, or be exposed to third party property
damage or personal injury claims, as a result of
liabilities associated with past practices or violations
ofenvironmental laws or non-compliance with
environmental permits.
Example key risk indicators:
- Carbon emissions
- Energy and water utilisation
- Volume of waste produced
- Number of environmental incidents
- Monitoring programmes established at certain sites
andappropriate financial provisions held.
- Environmental liability insurance procured for
certainrisks.
- Environmental consultants retained to manage
indemnification obligations for legacy site remediations.
- ESG and Environmental Committees established.
> SEE ALSO: ENVIRONMENT ON PAGES 44 TO
47, ANDTCFD REPORT ON PAGES 48 TO 55
Inherent risk: Medium
Risk appetite: Low
Trend: Increasing
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Safety
Excellence
PRINCIPAL RISKS AND UNCERTAINTIES
Details of the principal risks and uncertainties which could have a material
impacton the Group’s business model, strategy, future performance or
reputation are set out below. The principal risks are identified bythe Risk
Management Committee based on the likelihood of occurrence and the
potentialimpact onthe Group as a whole.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 71

HEALTH, SAFETY AND ENVIRONMENT RISKS continued
C. CLIMATE CHANGE
Risk and potential impacts Mitigation actions/factors
The Group’s operations and delivery of our strategy
could be impacted by climate change-related risks,
including those associated with wildfires, severe weather
events and new climate-related requirements in relation
to the Group’s manufacturing processes and products.
- Wildfires and severe weather events could result in
harm toemployees, the temporary shutdown of
facilities or other disruption to manufacturing processes.
- The Group may be exposed to financial loss for
business interruption and/or increased expenditure
foradapting its production facilities and processes
toaddress climate change-related risks.
Example key risk indicators:
- Wildfires
- Severe weather events
- New legislation
- Additional measures have been implemented, such
ascutting back grassland close to manufacturing
operations, to mitigate therisk of wildfires.
- Drainage has been improved on certain sites to
mitigate theimpact of potential flooding events.
- Carbon reduction plans and other environmental
performance targets have been established to
reducethe Group’s environmental impact.
- Close relationships are maintained with customers,
which should provide early insight into new environmental
requirements which are to be imposed by customers.
> SEE ALSO: ENVIRONMENT ON PAGES 44 TO
47, AND TCFD REPORT ON PAGES 48 TO 55
Inherent risk: Medium
Risk appetite: Low
Trend: Increasing
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Safety
Excellence
Innovation
STRATEGIC RISKS
D. MARKET
Risk and potential impacts Mitigation actions/factors
Defence spending depends on a complex mix of political
considerations, budgetary constraints and the
requirements of thearmed forces to address specific
threats and perform certain missions. Overall defence
spending may therefore be subject to significant yearly
fluctuations and there may also be downward pressure
on defence budgets in certain key programme areas.
The Group’s profits and cash flows are dependent, to
asignificant extent, on the timing of award of defence
contracts. In general, the majority of the Group’s contracts
are of a relatively short duration and, with the exception
of framework contracts with key customers, do not
cover multi-year requirements.
- The Group’s financial performance may be adversely
impacted by lower defence spending by its major
customers, either generally or in relation to
certainprogrammes.
- Short-term trading and cash constraints may impact
ontheGroup’s ability to invest in longer-term
technologies andcapabilities.
- Unmitigated delays in the receipt of orders or cancellation
of existing contracts could affect the Group’s financial
performance. Ifthe Group’s businesses are unable to
continue trading profitably during periods of lower
order intake, financial performance will deteriorate
andassets may be impaired.
Example key risk indicators:
- Defence budget cuts
- Reductions in order intake
- Deterioration in profitability
- Continual assessment of alignment of planned organic
growth strategies and technology roadmaps against
government priorities for future funding.
- Increased focus on the development of commercial
products andservices.
- Focus on organisational development to ensure the
business isappropriately structured to meet current
andfuture needs, and to provide resilience in difficult
market conditions.
- Continued focus on order intake as a key
performanceindicator.
- Pursuit of long-term, multi-year contracts with major
customers wherever possible.
- Global business development initiatives
establishedinthe Countermeasures and Sensors
&Information segments.
- Increased collaboration between businesses across
theGroup on establishing shared routes to market.
> SEE ALSO: MARKET OVERVIEW ON
PAGES 16 TO 17
Inherent risk: Medium
Risk appetite: Low to
moderate
Trend: Decreasing
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Safety
Excellence
Innovation
PRINCIPAL RISKS AND UNCERTAINTIES continued
Chemring Group PLC Annual report and accounts 202372

E. POLITICAL
Risk and potential impacts Mitigation actions/factors
The Group is active in several countries that are suffering
frompolitical, social and economic instability. In addition,
there isasignificant risk of political unrest and changes in
the political structure in certain non-NATO countries to
which the Group currently sells.
- The Group’s business in certain countries may be
adversely affected in a way that is material to the
Group’s financial position and the results of its operations.
- Political changes could impact future defence
expenditure strategy and the Group’s ability to
exportproducts to certaincountries.
Example key risk indicators:
- Political changes
- Suspension/withdrawal of export licences
- Trade embargoes
- Reductions in order intake
- Relationships maintained at political level in key
countries andwith senior customer representatives.
- Financing arrangements implemented, including letters
of credit and advance payments, for contracts with
high-risk customers.
- Political risks insurance procured in certain circumstances.
- Continued focus on the development of
commercialbusiness across the Group, particularly
inkey home territories.
> SEE ALSO: MARKET OVERVIEW ON
PAGES 16 TO 17
Inherent risk: Low
Risk appetite: Low to
moderate
Trend: Increasing
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Excellence
F. CONTRACTS
Risk and potential impacts Mitigation actions/factors
The Group’s government contracts may be terminated at
any timeand may contain other unfavourable provisions.
The Group may need to commit resources in advance
ofcontracts becoming fully effective, to ensure prompt
fulfilment of orders or toenable conditions precedent
tobe met.
- The Group may suffer financial loss if its contracts are
terminated by customers, or a termination arising out
of the Group’s default may have an adverse effect on
its ability to re-compete for future contracts and orders.
- Unfavourable commercial contract terms may adversely
impact the Group’s working capital position, particularly
if the receipt ofpayments by the Group is delayed.
Example key risk indicators:
- Number of contract claims/terminations
- Increase in working capital
- Delays in customer payments
- Number of bonds or guarantees called
- The Commercial Policy within the Operational
Framework requires central approval for certain
contractual risk exposures.
- Commercial and contract risk management training
programmeimplemented.
- Advance and stage payments negotiated with
customers wherever possible, in order to improve
working capital management.
Inherent risk: Low
Risk appetite: Moderate
Trend: Decreasing
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Excellence
Innovation
G. TECHNOLOGY
Risk and potential impacts Mitigation actions/factors
The Group may fail to maintain its position on key future
programmes due to issues with capability development,
technologytransfer or cost-effective manufacture.
The Group needs to continually add new products to its
current range,through innovation and continuing emphasis
on research and development. New product development
may be subject to delays, ormay fail to achieve the requisite
standards to satisfy volume manufacturing requirements and
the production of products against high reliability and safety
criteria to meet customer specifications.
- Failure to obtain production contracts on major
development programmes may significantly impact the
future performance and value of individual businesses.
- Failure to complete planned product development
andupgrades successfully may have financial and
reputational impacts, and may result in obsolescence
or loss of future business.
Example key risk indicators:
- Reduction in R&D expenditure
- Delays in R&D programmes
- Delays in qualification of products
- Loss of production contracts
- Emergence of new competitors and
disruptivetechnologies
- Close relationships maintained with customers on all
key futureprogrammes.
- New Product Development Policy and procedures
adopted, toalign the approach to future technology
investment across theGroup.
- Technology investments aligned with the five-year plan.
- Working groups established to drive and co-ordinate
technology growth in certain key areas within
Countermeasures & Energetics and Sensors
&Information.
Inherent risk: Medium
Risk appetite: Moderate
Trend: Stable
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Excellence
Innovation
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 73

STRATEGIC RISKS continued
H. FINANCIAL
Risk and potential impacts Mitigation actions/factors
The Group is exposed to a range of financial risks, both
externally driven, such as an unexpected movement in
foreign exchange rates, and specific to the Group.
Specific financial risks could ariseout of a disruption
tooperations; failure to deliver strategic objectives,
including planned investment; or customer-related
events, including defaults on the payment of debts.
As a result of a number of past events, the Group is
exposed to a number of contingent liabilities which may or
may not result in future cash outflows. (Further details are
contained in note 33 of the Group financial statements.)
- The Group may fail to comply with financing
covenantsand be unable to meet debt repayments,
leading to withdrawal of funding or additional costs
ofmaintaining funding.
- Operational results may be impacted by unexpected
financial losses or increased costs.
Further details of the financial risks to which the Group
is potentially exposed and details of mitigating factors are
set out in the financial review and note 21 of the Group
financial statements.
Example key risk indicators:
- Deterioration in bank covenants
- Increase in net debt
- Interest rate increases
- Foreign exchange rate movements
- Increase in bad debts
- Increase in inflation
- Committed banking facilities in place to December 2026.
- Regular monitoring of actual and forecast
financingcovenants.
- Capital approval processes in place, requiring Board
approval forsignificant projects.
- Hedging policy applied for significant foreign transactions.
- Energy bought forward in the UK and Norway to
mitigate price volatilities.
- Advance payments and letters of credit required
fromcustomers with a heightened payment risk.
> SEE ALSO: FINANCIAL REVIEW ON
PAGES 63 TO 66
Inherent risk: Low
Risk appetite: Moderate
Trend: Decreasing
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Safety
Excellence
I. OPERATIONAL
Risk and potential impacts Mitigation actions/factors
The Group’s manufacturing activities may be exposed to
business continuity risks, arising from plant failures,
supplier interruptions, quality issues or large scale
employee absences.
Planned new facility developments may be delayed as a
result ofoperational issues.
- Interruptions to production and sales could result in
financial loss, reputational damage and loss of future
business.
- A delay in completing new manufacturing facilities
could constrain capacity and limit future business
growth.
Example key risk indicators:
- Number of process safety events
- Reduction in right first time and on-time delivery rates
- Increase in supplier-related delays
- Increase in quality issues and customercomplaints
- Reduction in capital expenditure
- Delays in commissioning of facilities
- Major accident hazard analysis process and upset
condition management standard implemented across
the Group.
- Key performance indicators adopted, to provide better
visibility on operational performance and to facilitate
early identification of potential production and quality
issues.
- Advance purchases made of raw materials where
potential supply chain constraints are identified.
- Business continuity plans established across the Group.
- Continued capital investment in legacy facilities to
improve safetyand reliability.
- Asset integrity programme implemented.
- Detailed plans developed for all significant capital
investment projects, steering committee established
and additional dedicated resource employed to
oversee key projects.
- Business interruption risks insured where appropriate.
> SEE ALSO: GROUP CHIEF EXECUTIVE’S
REVIEW ON PAGES 12 TO 15, AND HEALTH
AND SAFETY ON PAGES 42 TO 43
Inherent risk: Medium
Risk appetite: Low to
moderate
Trend: Stable
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Safety
Excellence
Innovation
PRINCIPAL RISKS AND UNCERTAINTIES continued
Chemring Group PLC Annual report and accounts 202374

J. PEOPLE
Risk and potential impacts Mitigation actions/factors
There is a risk that the market for talent in key areas of
expertise becomes more challenging. Allied to this there
is a risk of loss ofkey personnel.
As the shape of the Group’s business changes and with
an increased focus in high technology areas, the Group
may fail to build and retain an appropriate skill base to
facilitate successful competition in new markets and
product areas.
Employees may not be fully-engaged with the Chemring
journey, purpose, products, customers and values.
- Failure to recruit sufficient suitably qualified personnel
in key areas of the business may result in the Group
failing to achieve itsfuture growth aspirations.
- Failure to build and retain key skills will lead to a
reduction intheability to innovate or to win and
deliver new contracts.
- If key personnel are not fully engaged with the business
purpose, values and products, and are not appropriately
incentivised, the ability of the Group to retain them will
be compromised. This could result in loss of management
expertise and knowledge, and the Group’s operations
may suffer as a consequence.
Example key risk indicators:
- Diversity statistics
- Increase in employee turnover
- Number of unfilled vacancies
- Employee sentiment scores
- Chemring values of Safety, Excellence and
Innovationestablished.
- Development framework implemented across the
Group, focusing on developing management and
leadership skills and behaviours particularly amongst
our line manager and supervisorpopulation.
- Ongoing review of capability requirements against
thebusinessstrategy.
- Increased focus on DE&I.
- Employee Voice real-time engagement tool deployed
across the Group.
- Talent framework and succession planning
processimplemented.
- Incentive arrangements enhanced to encourage
collaboration and create a Group focus at senior level.
> SEE ALSO: OUR PEOPLE ON
PAGES 56 AND 60
Inherent risk: Medium
Risk appetite: Low to
moderate
Trend: Stable
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Safety
Excellence
Innovation
K. CYBER-SECURITY
Risk and potential impacts Mitigation actions/factors
Cyber-security and related risks are key emergent areas
of critical importance for all businesses, particularly for
those involved in the defence and security sector.
Threats can emanate from a wide variety of sources and
could target various systems for a wide range of
purposes, making response particularly difficult.
The data and systems which need to be protected
include customer-classified or sensitive information,
commercially sensitiveinformation, employee-related data
and safety-critical manufacturing systems.
- The Group may suffer from critical systems failures, or
its intellectual property, or that of its customers, may
fall into the hands of third parties.
- In addition to business interruption and financial loss, the
Group may suffer reputational damage, and its business
of providing cyber-security services to customers may
be irreparably damaged.
Example key risk indicators:
- Number of “phish” emails reported
- Number of system attacks and failures
- Decrease in system availability
- Decrease in confidence and integrity of
data/information
- Cyber risk assessments completed and action plans
implemented to counter the Group’s identified
majorrisks.
- Security Committee established.
- Group-wide Cyber-Security Standard adopted based
on the US NIST 800-171 standard and a number of
cyber-security defence measures adopted,
encompassing, as appropriate to the nature of the
threat and sensitivity of data orsystems being
protected, hardware, software, system, process or
people-based solutions.
- Where appropriate, government or commercial
accreditation ofnetworks and systems obtained in
support of the overall cyber-security programme.
- IT and security systems review included within the
internal auditprogramme.
- Cyber incident response workshops held.
Inherent risk: Medium
Risk appetite: Low
Trend: Increasing
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Safety
Excellence
Innovation
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 75

LEGAL AND COMPLIANCE RISKS
L. COMPLIANCE AND CORRUPTION
Risk and potential impacts Mitigation actions/factors
The Group operates in over 50 countries worldwide,
ina highly regulated environment, and is subject to the
applicable laws and regulations of each of these
jurisdictions. The Group must ensure that all of its
businesses, its employees and third parties providing
services on its behalf comply with all relevant legal and
regulatory obligations. The nature of the Group’s
operations could also expose it to government and
regulatory investigations relating tosafety and the
environment, import-export controls, money
laundering,false accounting, and corruption or bribery.
The Group requires a significant number of permits,
licences andapprovals to operate its business, which
maybe subject tonon-renewal or revocation.
- Non-compliance could result in administrative, civil
orcriminal liabilities, and could expose the Group to
fines, penalties, suspension or debarment, and
reputational damage.
- Loss of key operating permits and approvals could
resultin temporary or permanent site closures,
andloss of business.
Example key risk indicators:
- Regulatory intervention and penalties
- Non-renewal/revocation of licences and permits
- Breaches of policies
- Non-completion of compliance training
- Increase in whistleblowing reports
- ESG Committee oversees compliance across the Group.
- Operational Framework in place, mandating compliance
witharange of policies and procedures covering a
wide range oflegaland regulatory requirements.
- Operational assurance process established as part
ofthe Operational Framework.
- Central legal and compliance function assists and
monitors all Group businesses, supported by
dedicatedinternal legal resource in the US.
- Code of Conduct stipulates the standards of acceptable
business conduct required from all employees and
third parties acting on the Group’s behalf.
- Updated Bribery Act Compliance Manual
implemented, incorporating enhanced anti-bribery
policies and procedures.
- Policy adopted to manage risks associated with sales
tocustomers in higher risk territories.
> SEE ALSO: ETHICS AND BUSINESS CONDUCT
ON PAGES 61 AND 62
Inherent risk: Medium
Risk appetite: Low
Trend: Decreasing
Link to strategy:
1
Capitalise on the
growth in our niche
markets with high
barriers to entry
2
Grow our
market-leading and
sole source positions
Link to values:
Excellence
Innovation
PRINCIPAL RISKS AND UNCERTAINTIES continued
Chemring Group PLC Annual report and accounts 202376

VIABILITY STATEMENT AND GOING CONCERN
In accordance with the UK Corporate Governance Code, the Board
isrequired to undertake an assessment of the long-term viability of
theGroup and going concern basis of accounting.
GOING CONCERN
The Group’s business activities, key performance indicators, and principal
risks and uncertainties are set out within the strategic report on pages 1
to78.
The directors believe that the Group is well placed to manage its business
risks successfully, despite the current uncertain economic outlook. The
Group’s forecasts and projections, taking account of reasonably possible
changes in trading performance, show that the Group should be able to
operate within the level of its current committed facilities.
KEY FINANCIAL METRICS
2023 Covenant
Revolving credit facility and overdraft £158m
Undrawn committed borrowing facilities £143m
Leverage ratio 0.21x Less than 3x
Interest cover ratio 30x Greater than 4x
The revolving credit facility of £150m runs to December 2025, of which
£130m has been extended to December 2026 with a “one-year” option to
extend to December 2027 at the lenders’ discretion. The $10m overdraft
facility was increased to $20m in November 2023. The Group was in
compliance with the covenants throughout the year.
ASSESSMENT OF NEAR-TERM PROSPECTS
As part of a regular assessment of the Group’s working capital and financing
position, the directors have prepared a detailed bottom-up two-year trading
budget and cash flow forecast for the period through to October 2025.
Thishas allowed the directors to assess going concern for a period of at least
12 months after the date of approval of the financial statements. This is in
addition to the Group’s longer-term strategic planning process. In assessing
the forecast, the directors haveconsidered:
- trading risks presented by the current economic conditions in thedefence
market, particularly in relation to government budgets andexpenditure;
- the impact of macro-economic factors, particularly interest rates and
foreign exchange rates;
- the status of the Group’s existing financial arrangements and associated
covenant requirements;
- progress made in developing and implementing cost reduction programmes
and operational improvements;
- the availability of mitigating actions should business activities fall behind
current expectations, including the deferral of discretionary overheads and
restricting cash flows; and
- the long-term nature of the Group’s business which, taken together with
the Group’s order book, provides a satisfactory level of confidence to the
Board in respect of trading.
SENSITIVITY ANALYSIS
Additional detailed sensitivity analysis has been performed on the forecasts to
consider the impact of severe, but plausible, reasonable worst case scenarios
on the covenant requirements. These scenarios, which sensitised the forecasts
for specific identified risks, modelled the reduction in anticipated levels of
underlying EBITDA and the associated increase in net debt. These scenarios
included significant delays to major contracts and considered the principal
risks and uncertainties discussed in the strategic report. These sensitised
scenarios show headroom on all covenant test dates for the foreseeable future.
CONFIRMATION OF GOING CONCERN
After consideration of the above, the directors have a reasonable expectation
that the Group and the Company will have sufficient funds to continue to
meet its liabilities as they fall due for at least 12 months from the date of
approval of the financial statements and therefore have prepared the
financialstatements on a going concern basis.
LONG-TERM VIABILITY
ASSESSMENT OF LONG-TERM PROSPECTS
The directors have assessed the Group’s viability over the subsequent three
financial years to October 2026 based on the above assessment, combined
with the Group’s strategic planning process, which gives greater certainty
over the forecasting assumptions used. Based on this assessment, the
directors have a reasonable expectation that the Group will be able to
continue in operation and meet all its liabilities as they fall due up to
October2026.
The directors have chosen the subsequent three financial years as the period
to assess viability to reflect thecharacteristics of the Group’s end markets
and their contracting arrangements. These range from multi-year contracts
such as the US Programs of Record to shorter-term orders, such as those
awarded toRoke.
PRINCIPAL RISKS
In considering our viability statement we have considered the principal risks
and uncertainties discussed in the strategic report and assessed the impact.
Those risks with the most significant potential financial impact included
occupational and process safety risks, operational risks and environmental
laws and regulations risks.
SENSITIVITY ANALYSIS
Sensitivity analyses were run to model the financial and operational impact
ofplausible downside scenarios of these risk events occurring individually or
in combination. These included the impacts of a further deterioration in the
macro-economic environment including future government policy and
spending, underperformance in executing the Group’s strategy, failure to
achieve operational improvement and material movements in foreign
exchange rates.
Consideration was also given to the plausibility of the occurrence of other
individual events that in their own right could have a material impact on the
Group’s viability.
CONFIRMATION OF VIABILITY
Based on the consolidated financial impact of the sensitivity analyses and
associated mitigating internal controls and risk management actions that are
either now in place or could be implemented, the Board has been able to
conclude that the Group will be able to maintain sufficient bank facilities to
meet its funding needs over the three-year period and the Group’s forecasts
show compliance with covenants under the revolving creditfacility.
STRATEGIC REPORT
Chemring Group PLC Annual report and accounts 2023 77

NON-FINANCIAL AND SUSTAINABILITY INFORMATION STATEMENT
This section of the strategic report constitutes the Group’s non-financial
and sustainability information statement and addresses the requirements of
sections 414CA and414CB of the Companies Act 2006. The non-financial
information is includedwithin the various other sections of the strategic
reportand is cross-referenced below.
Our Code of Conduct provides direction to our employees on the standards of behaviour and business conduct which we expect from them. It sits alongside
our Operational Framework, which incorporates a wide range of policies and procedures to enable our businesses to comply with their legal obligations and to
operate in a safe, consistent and accountable way.
> OUR CODE OF CONDUCT AND OUR KEY PUBLIC POLICIES ARE AVAILABLE AT WWW.CHEMRING.COM.
Reporting requirement Relevant policies which govern our approach Where to read more Page
Environmental matters - Group health, safety and environmental policy - Introduction to sustainability
- Environment
- TCFD report
38
44
48
Employees - People policy
- Group health, safety and environmental policy
- Directors’ remuneration policy
- Whistleblowing policy
- Code of Conduct
- Stakeholder engagement
- Our people
- Health and safety
- Ethics and business conduct
- Directors’ remuneration report
34
56
42
61
100
Social and
communitymatters
- Community investment policy
- Code of Conduct
- Our people
- Ethics and business conduct
56
61
Respect for
human rights
- Modern Slavery Act Statement
- People policy
- Supplier Code of Conduct
- Code of Conduct
- Our people
- Ethics and business conduct
56
61
Anti-bribery
andcorruption
- Anti-corruption policy
- Bribery Act Compliance Manual
- Policy on sales to customers located in
higher-risk territories
- Offset policy
- Code of Conduct
- Ethics and business conduct 61
Business model - What we do
- Investment case
- Business model
- Market overview
- Strategy
2
10
24
16
18
Stakeholders - Stakeholder engagement
- Corporate governance report
34
84
Risk management - Risk management
- Principal risks and uncertainties
67
69
Non-financial key
performance indicators
- Key performance indicators
- Health and safety
- Environment
- Our people
20
42
44
56
Chemring Group PLC Annual report and accounts 202378

GOVERNANCE
IN THIS SECTION:
80 Chairman’s introduction to governance
82 Board of directors
84 Board leadership and company purpose
89 Division of responsibilities
92 Composition, succession and evaluation
93 Audit, risk and internal control
94 Audit Committee report
98 Nomination Committee report
10 0 Remuneration overview
102 Remuneration at a glance
10 4 Annual report on remuneration
110 Additional statutory information on remuneration arrangements
115 Directors’ remuneration policy
123 Directors’ report
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 79

CHAIRMAN’S INTRODUCTION TO GOVERNANCE
MAINTAINING A ROBUST
GOVERNANCEFRAMEWORK
“ Our Operational Framework and our
Code of Conduct promote a set of
policies, practices and behaviours
whichare fully aligned with Chemring’s
purpose, values, vision and strategy.”
Our Code of Conduct reflects our purpose and our values, and sets out
thestandards of behaviour and business conduct we expect of all Chemring
employees and all third parties acting on our behalf. It also reinforces the
culture the Board embraces within Chemring of always doing the right thing
and taking personal responsibility for our actions. We firmly believe that
promoting a Chemring culture which embraces responsible behaviour will
contribute to the long-term success of the business and will benefit all of
ourstakeholders. The Code of Conduct was updated and reissued to all
employees during late 2021, and was supplemented with ongoing
scenario-based training during the year.
GOVERNANCE AND OPERATIONAL FRAMEWORK
Our Operational Framework provides an enhanced governance framework
to enable us to operate in a safe, consistent and accountable way. Together
with our Code of Conduct, the Operational Framework promotes a set of
policies, practices and behaviours which are fully aligned with Chemring’s
purpose, values, vision and strategy.
The Ethics & Compliance Committee which was previously constituted by the
Board was merged with the established Sustainability Committee during the
year to form an ESG Committee, which is chaired by the Group Chief Executive.
Alongside its responsibilities for the oversight of our environmental and social
policies across the Group, the ESG Committee also maintains oversight of our
ethical business conduct and compliance arrangements, and its activities reinforce
the importance of responsible behaviour at all levels of the organisation. The
ESG Committee reports to the Board on a regular basis. Further details of
the ESG Committee’s activities during the year can be found on page 61.
STRATEGY
The delivery and further evolution of the Group’s strategy, which is articulated
in my statement on page 8 and in the strategy section on pages 18 to 19,
continues to be one of the principal areas of focus for the Board. In addition
to our annual review of the updated Group strategy and five-year plan, which
is completed in July each year, the Board addressed specific strategic topics in
a number of our meetings during the year. This regular drumbeat of strategic
discussions greatly enhances the Board’s understanding of the potential
opportunities available to our businesses and ensures that the requisite
resources are allocated to the realisation and optimisation of these opportunities.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE (“ESG”)
The Board clearly recognises that long-term value creation can only be delivered
through safe, sustainable and responsible business operations. As referred to
above, the Board has established an ESG Committee, which is chaired by the
Group Chief Executive, to oversee the delivery of our ESG strategy. ESG-related
objectives are now widely reflected in the incentive arrangements for our
leadership teams and performance against agreed ESG targets is monitored
by the Board at every meeting. Further details on our ESG-related activities
and the further progress made in the year can be found in the sustainability
section on pages 38 to 41.
The Board is committed to upholding high
standardsof corporate governance, protecting
andgrowing shareholder value, and engaging in
afairandtransparent manner with all of the
Group’sstakeholders.
On behalf of the Board, I am pleased to present the governance report
forthe year ended 31 October 2023. The report explains how the Board
operates and how corporate governance is addressed in Chemring. The
report comprises the following:
BOARD OF DIRECTORS
CORPORATE GOVERNANCE REPORT
AUDIT COMMITTEE REPORT
NOMINATION COMMITTEE REPORT
DIRECTORS’ REMUNERATION REPORT
DIRECTORS’ REPORT
UK CORPORATE GOVERNANCE CODE
In the year under review, Chemring was subject to the UK Corporate
Governance Code published in July 2018 by the Financial Reporting Council
(the “Code”) and the governance report sets out how we have complied
withthe Code.
PURPOSE, VALUES AND CULTURE
The Board recognises its role in establishing the purpose and values of
theGroup, and embedding these throughout the organisation.
Our purpose at Chemring is to help make the world a safer place - an
endeavour which has continued to have been validated over the past year.
Across physical and digital environments, our businesses and our employees
deliver innovative protective technologies to detect and defeat ever-changing
threats. Our purpose and our core values of Safety, Excellence and Innovation
form the foundation for our strategy, our business and our organisation.
Examples of how we are living our values can be found on pages 6 and 7.
Carl-Peter Forster
Chairman
Chemring Group PLC Annual report and accounts 202380

BOARD APPOINTMENTS AND DIVERSITY
In January 2023, Andrew Lewis, who has served as Chief Financial Officer since
January 2017, announced that he intended to retire on completion of his 12
months’ notice period. A search process for his replacement was duly initiated,
culminating in the announcement in May 2023 of the selection of James Mortensen
as our new Chief Financial Officer. Details of the search process undertaken
are set out on page 98. James joined the Board with effect from 1 November
2023 and will replace Andrew as Chief Financial Officer with effect from
1January 2024. Andrew will step down from the Board on 31 December
2023 and will leave the Group on 19 January 2024. On behalf of the Board,
Iconvey our thanks to Andrew for his contribution to the success of the
Group over the past six years and wish him well in his retirement.
In acknowledgement of the benefits associated with having a diverse range
ofskills, experience and backgrounds amongst members of the Board, the
Nomination Committee agreed last year that it would be beneficial to
appoint an additional non-executive director in order to further improve
diversity on the Board. A search process was instigated, further details of
which are set out in the Nomination Committee report on pages 98 to 99,
following which Alpna Amar was appointed as an independent non-executive
director on 13 June 2023. Alpna brings with her considerable experience of
corporate strategy and finance accumulated across a range of consulting and
corporate roles, and is already making a valuable contribution to the Board.
The Board is fully cognisant of each of the diversity targets set out in the
updated Listing Rules which applied to the Group for the first time in the
yearunder review. Andrew Davies will step down as the Senior Independent
Director onthe termination of his third three-year term as a non-executive
director inearly 2025 and it has been agreed that Fiona MacAulay will be
appointed asthe Senior Independent Director thereafter. The Board will then
fully meet the diversity targets. I will also complete my third three-year term
as Chairman in early 2025 and due regard will be given to the targets when
considering myreplacement.
STAKEHOLDER ENGAGEMENT
In recognition of the requirement under the Code for the Board to establish
a mechanism for engaging directly with our employees, Laurie Bowen is designated
as the non-executive director with responsibility for employee engagement
on behalf of the Board. Laurie held a number of meetings with employees at all
levels of the organisation at three of our businesses during the year, at which
she shared with employees a perspective on the Board’s priorities and
provided an opportunity for them to ask questions of her. Further details are
provided later in the report. Feedback from these meetings has continued to
be generally positive, with employees welcoming the opportunity to meet
with a non-executive member of the Board and to be able to provide honest
feedback to a senior member of the organisation outside of their direct line
management. Insights from these interactions, which are reported to the
Board following the engagement sessions, continue to provide valuable input
to the Board’s deliberations.
We fully recognise our obligation to engage with and consider the impact
ofthe Board’s decisions on all of our stakeholders. Further details on our
approach can be found on pages 34 to 37 and later in this report.
BOARD EFFECTIVENESS
The Board as a whole visited our sites in Scotland and Norway during the
year, recognising the growing importance of the Energetics businesses in the
Group’s growth strategy. The Board also undertook its annual visit to Roke.
The Board continues to foster the strong relationship established with our US
Board in recent years and the President of the US Board joined several of our
Board meetings in the UK. The Group Chief Executive and I also met with the
US Board in November this year to mark the retirement of the Chairman of
the US Board, who had served the Group for over six years, and to welcome
his successor.
These engagement activities are very beneficial to aiding the Board’s
understanding of both the challenges and opportunities within our businesses,
and we will continue with our scheduled programme of site visits in 2024.
COMPLIANCE WITH THE UK
CORPORATEGOVERNANCECODE
In the year under review, the Company was required to apply the main
andsupporting principles of good governance set out in the UK Corporate
Governance Code issued in 2018 by the Financial Reporting Council
(the“Code”). The Company was in compliance with the provisions of
theCode throughout the year ended 31 October 2023.
Further details on how the Company applied the principles of the Code
during the year can be found as follows:
SEE PAGE
BOARD LEADERSHIP AND COMPANY PURPOSE
Long-term value and sustainability
Culture
Shareholder engagement
Employee engagement
Other stakeholder engagement
Conflicts of interest
84
84
88
88
87
89
DIVISION OF RESPONSIBILITIES
Role of the Chairman
Division of responsibilities
Non-executive directors
90
90
90
COMPOSITION, SUCCESSION AND EVALUATION
Appointments and succession planning
Skills, experience and knowledge
Length of service
Evaluation
Diversity
98-99
89
82-83
92
99
AUDIT, RISK AND INTERNAL CONTROL
Audit Committee
Integrity of financial statements
Fair, balanced and understandable
Internal controls and risk management
External auditor
Principal and emerging risks
94
95-96
96
67
96
69
REMUNERATION
Policies and practices
Alignment with purpose, values and long-term strategy
Independent judgement and discretion
100
116
100
BOARD EVALUATION
In accordance with the recommendations of the Code, the Board
performance evaluation was externally facilitated this year. Gould Consulting
were engaged to facilitate the evaluation, further details of which are set out
on page 92.
Carl-Peter Forster
Chairman
12 December 2023
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 81

CARL-PETER FORSTER
N R
Non-Executive Chairman
BOARD LENGTH
OFSERVICE
(as at 12 December 2023):
7 years, 7 months
EXPERIENCE:
- Board experience at
Chairman and Chief
Executive level
- Extensive international
experience within the
industrial goods and
engineering sectors
- Expertise in operational
excellence and lean
manufacturing
Carl-Peter Forster joined
theGroup as an independent
non-executive director and
Chairman-designate on1May
2016, and was appointed
Chairman of the Board on
1July 2016.
Carl-Peter formerly held senior
leadership positions in some of
theworld’s largest automotive
manufacturers, including BMW,
General Motors and Tata Motors
(including Jaguar Land Rover).
Carl-Peter is currently the
Chairmanof Vesuvius plc* and
the Senior Independent Director
at Babcock International Group
PLC
*
. He is also Chairman of
StoreDot and a member of the
Boards of The Mobility House
AG, Kinexon GmbH, Envisics
Ltd and Gordon Murray Group
Ltd. He was previously a
non-executive director of IMI
plc and Rexam PLC,
Rolls-Royce plc and Cosworth
Ltd, and Chairman of the Hella
KGaA Shareholder
Committee, The London
Electric Vehicle Company Ltd
and Friedola Tech GmbH, and
a member of the Boards of
Volvo Cars Corporation and
Geely Automobile Holdings.
MICHAEL ORD
Group Chief Executive
BOARD LENGTH
OFSERVICE
(as at 12 December 2023):
5 years, 6 months
EXPERIENCE:
- Extensive senior
management experience
inthe defence sector
- International experience
inbothservice and
manufacturingindustries
Michael Ord was appointed to
the Board on 1 June 2018 and
appointed as Group Chief
Executive on 1 July 2018.
Michael is currently a
non-executive director
ofTTElectronics plc*.
Michael formerly held a number
of senior management roles
with BAE Systems including
Managing Director of their
Naval Ships and F-35 Joint
Strike Fighter businesses. Prior
to his 1996 move to industry,
Michael had a successful career
in the Royal Navy serving
for 12 years in a number of
engineering management roles.
An Aeronautical Systems
Engineering graduate and
aChartered Engineer, Michael
has also completed post-graduate
management studies at
Manchester Business School
and is a graduate of Harvard
Business School’s Advanced
Management Programme.
Heis a member of the
RoyalAeronautical Society.
Hepreviously served as a
trustee of The Education
andTraining Foundation.
ANDREW LEWIS
Chief Financial Officer
(to 31 December 2023)
BOARD LENGTH
OFSERVICE
(as at 12 December 2023):
6 years, 11 months
EXPERIENCE:
- Extensive international
experience in the
defencesector
- Board experience at
Finance Director level
- Chartered Accountant
Andrew Lewis joined the
Group on 9 January 2017 and
was appointed to the Board
asChief Financial Officer on
19January 2017. Andrew will
retire as Chief Financial Officer
and will step down from the
Board on 31 December 2023.
Andrew spent eight years as
Group Finance Director of
Avon Rubber p.l.c., where he
also performed the Interim
CEO role during 2015,
following the retirement of
theprevious CEO.
Prior to joining Avon, Andrew
was Group Financial Controller
of Rotork plc and before that
he was a Director at
PricewaterhouseCoopers in
Bristol and New Zealand.
JAMES MORTENSEN
Chief Financial Officer
(with effect from 1 January 2024)
BOARD LENGTH
OFSERVICE
(as at 12 December 2023):
0 years, 1 month
EXPERIENCE:
- Extensive senior
management experience
ininternational technology
and manufacturing
businesses
- Strategy and M&A
experience
- Chartered Accountant
James Mortensen was
appointed to the Board on
1November 2023 and will be
appointed as Chief Financial
Officer on 1 January 2024.
Prior to joining the Group,
James was Group Head of
Corporate Development
at Smiths Group plc and
was Chief Financial Officer
of Smiths Medical Division
from2020 to 2022.
Prior to joining Smiths, James
spent eight years at Smith &
Nephew plc, where he held
various senior finance roles.
James started his career in
KPMG’s audit practice.
SARAH ELLARD
Group Legal Director
& Company Secretary
BOARD LENGTH
OFSERVICE
(as at 12 December 2023):
12 years, 3 months
EXPERIENCE:
- Legal, compliance and
governanceexpertise
- Chartered Secretary
Sarah Ellard was appointed
asGroup Legal Director on
7October 2011, having been
Group Company Secretary
since 1998.
Prior to joining the Group,
Sarah trained and worked at
Ernst & Young LLP. She is a
Fellow of the Chartered
Governance Institute.
LENGTH OF SERVICE
0–2 years (2)
3–4 years (2)
5+ years (6)
BOARD OF DIRECTORS
EXPERIENCED LEADERSHIP
CHAIRMAN EXECUTIVE DIRECTORS
COMMITTEE
MEMBERSHIP
A
Audit Committee
N
Nomination Committee
R
Remuneration Committee
Denotes Chair
20%
20%
60%
* Designates a current public company appointment.
Chemring Group PLC Annual report and accounts 202382

NON-EXECUTIVE DIRECTORS
ALPNA AMAR
A N
Non-Executive Director
BOARD LENGTH
OFSERVICE
(as at 12 December 2023):
0 years, 6 months
EXPERIENCE:
- International experience
within the automotive and
construction sectors
- Chartered Accountant
Alpna Amar was appointed as
an independent non-executive
director on 13 June 2023.
Alpna is currently Corporate
Development Director of Kier
Group plc and is a member of
Kier Group’s Executive
Committee. She has a wealth
of corporate, operational and
commercial finance, strategy,
M&A and investor relations
experience in both corporate
and consulting positions.
Prior to joining Kier Group,
Alpna held senior investor
relations and corporate
development roles at global
automotive suppliers, TI Fluid
Systems plc and International
Automotive Components
Group SA.
LAURIE BOWEN
A N R
Non-Executive Director
BOARD LENGTH
OFSERVICE
(as at 12 December 2023):
4 years, 5 months
EXPERIENCE:
- Board experience at Chief
Executive level
- International experience in
the technology sector
Laurie Bowen was appointed
as an independent non-executive
director on 1 August 2019 and
was appointed as Chairman of
the Remuneration Committee
on 4 March 2020. She is a
non-executive director of
Ricardo plc* and also serves as
anon-executive director of SBA
Communications Corporation*.
Laurie has over 30 years of
leadership experience at large
multinational telecommunications
and technology companies
including Cable & Wireless
Communications plc, Tata
Communications, BT Group
plc and IBM. Most recently
shewas Chief Executive of
Telecom Italia Sparkle in the
Americas, a subsidiary of the
international wholesale arm
ofTelecom Italia.
Laurie was previously a
non-executive director
atcustomer experience
technology provider
TranscomWorldwide AB.
ANDREW DAVIES
A N R
Senior Independent
Non-Executive Director
BOARD LENGTH
OFSERVICE
(as at 12 December 2023):
7 years, 7 months
EXPERIENCE:
- Board experience at Chief
Executive level
- Extensive knowledge of the
international defence industry
Andrew Davies was appointed
as an independent non-executive
director on 17 May 2016 and
was appointed as Senior
Independent Director on
1May 2020. He also served as
Chairman of the Remuneration
Committee until 4 March 2020.
Andrew is currently Chief
Executive of Kier Group PLC*.
He has a wealth of relevant
sector experience, having
served in senior operational
and strategic roles at executive
committee level at BAE Systems
plc for more than 14 years. He
was formerly Chief Executive
of Wates Group Ltd.
STEPHEN KING
A N R
Non-Executive Director
BOARD LENGTH
OFSERVICE
(as at 12 December 2023):
5 years, 1 month
EXPERIENCE:
- Executive and non-executive
board experience in public
and private companies
- Chartered Accountant
Stephen King was appointed as
an independent non-executive
director on 1 December 2018
and as Chairman of the Audit
Committee on 1 August 2019.
Stephen has a wealth of senior
level experience within the
industrial, engineering and
manufacturing sectors, including
a number of executive and
non-executive roles. Stephen
retired as Group Finance
Director of Caledonia
Investments plc in 2018. He
was previously a non-executive
director and Chairman of the
Audit Committee at Signature
Aviation plc and The Weir
Group plc, and a non-executive
director and Senior Independent
Director at TT Electronics plc.
Stephen was Finance Director
at De La Rue plc from 2003
to2009, and prior to that at
Midlands Electricity plc. A
Chartered Accountant,
Stephen has also held senior
financial positions at Lucas
Industries plc and Seeboard
plc, and was a non-executive
director of Camelot plc.
FIONA MACAULAY
A N R
Non-Executive Director
BOARD LENGTH
OFSERVICE
(as at 12 December 2023):
3 years, 6 months
EXPERIENCE:
- Board experience at
ChiefExecutive level and
innon-executive positions
- International and
operational experience in
high-hazard industries
Fiona MacAulay was
appointedas a non-executive
director on3 June 2020. She is
also a non-executive director
of Ferrexpo plc*, Costain
GroupPLC*, Dowlais Group
plc* and EPI Group Ltd. She was
previously Chair of IOG plc and
a non-executive director of
Coro Energy Plc.
Fiona previously held a number
of senior operational roles
within the oil and gas sector,
including a two-year appointment
as Chief Executive of Echo
Energy plc in 2017.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 83

CORPORATE GOVERNANCE REPORT
BOARD LEADERSHIP
ANDCOMPANY PURPOSE
GOVERNANCE FRAMEWORK
The Board is responsible for
ensuring leadership of the Group
through effective oversight and
review, with the aim of delivering
the long-term sustainable success of
the business. The Board discharges
some of its responsibilities directly
in accordance with the formal
schedule of matters reserved to it
for approval, and discharges others
through Board committees and the
executive management.
The key responsibilities of the
Board, its committees and the
executive management are set
outalongside.
The terms of reference of the
Board committees are published
onthe Company’s website:
WWW.CHEMRING.COM/
INVESTORS/CORPORATE-
GOVERNANCE
THE BOARD
Responsible for promoting the long-term sustainable success of the Group; directing its purpose, values and
strategy; oversight of financial and organisational control; ensuring that the Group’s businesses have appropriate
and effective internal control and risk management systems; and ensuring effective engagement with stakeholders.
THE CHIEF EXECUTIVE
Responsible for the leadership and day-to-day management of the business, and development
andimplementation of the Group’s strategy.
EXECUTIVE COMMITTEE
Assists the Group Chief Executive with oversight of the delivery of the Group’s strategy; monitoring of the
operational and financial performance of the businesses; allocation of resources across the Group; management
ofrisk; and implementation of the Group’s Operational Framework and governance policies.
The Group Chief Executive chairs the Executive Committee, which meets bi-monthly. The members of the
Committee are the executive directors, the President and the Chief Financial Officer of the Group’s US operations,
the Group HSE Director, the Group Strategy and Corporate Development Director and the Group Director of
Corporate Affairs. Full details of the Executive Committee members can be found on the Group’s website:
WWW.CHEMRING.COM
RISK MANAGEMENT COMMITTEE
Oversees the implementation of the risk management
policy and framework; identifies the principal risks to
which the Group is exposed; monitors risk mitigation
plans; and maintains the Group risk register.
ESG COMMITTEE
Oversees the implementation ofthe Group’s ESG
strategy; monitors progress against agreed ESG
targets; and identifies further ESG-related objectives.
AUDIT COMMITTEE
Monitors the integrity of the
financial statements, and the
effectiveness of the external
andinternal audit processes.
NOMINATION COMMITTEE
Evaluates the size, structure and
composition of the Board, and
oversees Board appointments.
REMUNERATION COMMITTEE
Sets and reviews the directors’
remuneration policy, and oversees
remuneration arrangements for
the senior leadership.
PURPOSE
Chemring’s purpose is to help make the world a
safer place. Across physical and digital environments,
our exceptional teams deliver innovative protective
technologies to detect and defeat ever-changing threats.
> FURTHER DETAILS ON OUR PURPOSE AND HOW IT LINKS TO OUR
STRATEGY AND VALUES CAN BEFOUND ON PAGES 6 TO 7
CULTURE AND VALUES
The Board is responsible for ensuring that the Company’s culture is aligned
with its purpose, values and strategy. We are committed to creating an
inclusive culture across Chemring, where everyone does the right thing
andtakes personal responsibility for their actions. This culture is promoted
through leadership and a strong “tone from the top” and is embedded in
ourCode of Conduct and our Operational Framework, both of which bind
our purpose, values, behaviour, policies and procedures, and provide the
necessary governance to enable us to operate in a safe, consistent and
accountable way.
The Chairman is responsible for ensuring that the Board demonstrates
commitment to our values and culture by operating appropriately and taking
the right actions on behalf of shareholders and other stakeholders. The
Group Chief Executive, supported by the Executive Committee and the
business unit leadership teams, is responsible for ensuring that our values
andculture are fully embedded within all aspects of our operations.
> FURTHER DETAILS ON HOW OUR VALUES DRIVE BEHAVIOURS ARE
SET OUT ON PAGES24AND 25
> SEE PAGE 94 AUDIT
COMMITTEE REPORT
> SEE PAGE 98 NOMINATION
COMMITTEE REPORT
> SEE PAGE 100 DIRECTORS’
REMUNERATION REPORT
> SEE PAGE 67
RISKMANAGEMENT
> SEE PAGES 38 TO 41 INTRODUCTION
TOSUSTAINABILITY ANDETHICS
ANDBUSINESS CONDUCT
Chemring Group PLC Annual report and accounts 202384

HOW THE BOARD ESTABLISHES AND MONITORS CULTURE
ESTABLISHMENT OF CULTURE MONITORING OF CULTURE
SAFETY - HSE Policy, Management System Framework and strategy
- Focus on “Journey to Zero Harm” and drive towards a
proactive safety culture
- Fundamental Safety Principles
- “Spot It, Stop It, Share It” campaign
- Technical Safety Committee
- Monthly reporting to the Board on safety performance against key
performance indicators, including near miss reporting rates
- The Board receives regular updates from the Group HSE Director
on progress against the HSE strategy, significant incidents and near
misses, and key findings of our HSE assurance processes
- The Board is briefed by independent external consultants on their
periodic review of the Group’s progress on embedding a proactive
safety culture
EMPLOYEES - Code of Conduct
- Monthly video-blog by the Group Chief Executive
andGroup-wide communication programme
- Diversity, equity and inclusion policy and initiatives
- Employee development programmes
- ESG Committee and inclusion of ESG objectives in
shortand long-term incentive arrangements
- Laurie Bowen, the non-executive director charged with employee
engagement on behalf of the Board, provides regular feedback on
her discussions with employees at all levels of the organisation
- The Board receives regular updates on employment sentiment
across the Group measured through our real-time engagement tool,
Employee Voice, and undertakes periodic culture “check-ins”
facilitated by an external consultant
- Reporting to the Board on progress against established ESG targets
- Board site visits
GOVERNANCE
AND BUSINESS
CONDUCT
- Code of Conduct
- Operational Framework and operational assurance process
- ESG Committee and inclusion of governance-related
objectives in short-term incentive arrangements
- Chemring Compliance Portal
- Mandatory training programmes
- Whistleblowing policy and procedures
- The ESG Committee monitors ethical business conduct and
implementation of the Group’s compliance framework, and makes
recommendations to the Board on areas for future improvements
- The Group Legal Director reports to the Board on a monthly basis
on governance and compliance matters
- Review of compliance with key policies under the Operational
Framework is included within the internal audit programme
- The Group has a formal whistleblowing policy and procedures, and
the Board is provided with an overview of whistleblowing reports
received, related investigation findings and any remedial actions taken
INTERNAL
CONTROL
ANDRISK
MANAGEMENT
- Operational Framework and operational assurance process
- Group Finance Manual and internal control framework
- Risk Management Committee
- Risk Management Policy and Framework
- Internal audit programme
- The Audit Committee reviews internal audit reports produced
byour internal audit function and subject matter expert external
consultants, and the Board considers any significant issues arising
therefrom and any improvements required to our internal
controlsystems
- The Board reviews the Group’s risk register on a regular basis and
has high-level oversight of mitigation plans implemented for key risks
- Operational assurance statements are required to be submitted by
the businesses on an annual basis
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 85

CORPORATE GOVERNANCE REPORT continued
BOARD LEADERSHIP AND
COMPANYPURPOSE continued
BOARD ACTIVITIES IN 2023
LEADERSHIP STRATEGY
- Reviewed the company’s purpose, vision and values
- Visited businesses in the UK and Norway
- Monitored culture through feedback on employee sentiment measured
through “Employee Voice”
- Approved new appointments to the Board
- Completed the annual Board performance evaluation
- Approved the updated five-year plan and strategy for the Group
- Engaged in reviews of organic and inorganic growth opportunities across
the Group
- Reviewed potential acquisition targets for Roke and Chemring Energetic Devices
- Considered the implications for the Group of changes to the US
Department of Defense’s budget funding priorities and the reshaping of
other key defence markets
- Reviewed the UK Government’s Integrated Review Refresh 2023 and the
Defence Command Paper subsequently published by the UK MOD, and
assessed the potential opportunities for the Group’s UK businesses
- Reviewed priorities for capital and operational investment and approved
key investment programmes
FINANCIAL HEALTH, SAFETY, ENVIRONMENT AND SUSTAINABILITY
- Monitored performance of the businesses against the 2023 budget
- Approved the 2024/2025 budgets
- Approved the half year results, and the annual report and accounts
- Approved an extension to the Group’s revolving credit facilities
- Reviewed the Group’s capital allocation policy and approved a share
buyback programme
- Approved the proposed buyout of the legacy UK defined benefit
pensionscheme
- Approved the interim dividend and made a recommendation for the
finaldividend
- Monitored health, safety and environmental key performance indicators on
a monthly basis
- Received briefings on significant incidents and high-potential near misses
- Agreed and reviewed progress against key health, safety and
environmentalobjectives
- Received an update from external consultants on the development of the
safety culture across the Group
- Received regular updates from the ESG Committee
- Approved the Group’s approach to TCFD reporting and the management
of climate change risks
- Approved the Sustainability Report
PEOPLE AND CULTURE GOVERNANCE, RISK AND REGULATORY
- Received regular reports from the Remuneration Committee
- Considered feedback from Laurie Bowen, the non-executive director
designated to engage with employees on the Board’s behalf, on issues
raised with Mrs Bowen by employees
- Reviewed the Group’s talent framework, development programmes and
succession plans
- Reviewed the Group’s diversity, equity and inclusion policy and strategy
- Received feedback on employee sentiment across the Group
- Reviewed the Group’s risk register, and completed the annual assessment
of the Group’s internal control and risk management systems
- Received regular updates from the Audit Committee and the ESG Committee
- Received updates on key legal issues and regulatory matters impacting
theGroup
- Reviewed the Group’s cyber-security arrangements
- Received regular updates on significant whistleblowing reports
- Reviewed the Company’s compliance with the Code
- Reviewed and updated the Schedule of Matters Reserved for the Board
and associated delegated levels of authority
- Approved the Group’s Modern Slavery Act statement for 2023
SHAREHOLDERS
- Reviewed feedback from the results presentations and institutional investor meetings
- Received updates from brokers and other advisers and the Group Director of Corporate Affairs on current shareholder views on the Group
- Participated in a wide range of engagement meetings with current and potential new shareholders
Chemring Group PLC Annual report and accounts 202386

HOW THE BOARD CONSIDERS STAKEHOLDERS IN ITS DECISION MAKING
Section 172 (1) of the Companies Act 2006 requires the directors to act in the way they consider, in good faith, would most likely promote the success of
thecompany for the benefit of its members as a whole. In doing so, section 172 requires the directors to have regard, amongst other matters, to the:
- likely consequences of any decision in the long term;
- interests of the company’s employees;
- need to foster the company’s business relationships with suppliers, customers and others;
- impact of the company’s operations on the community and environment;
- desirability of the company maintaining a reputation for high standards of business conduct; and
- need to act fairly as between members of the company.
The statement of compliance with section 172 is set out on pages 34 to 37, together with details of how the Board engages with stakeholders and how the Board
monitors stakeholder interests. Set out below are some specific examples of how the Board considered stakeholders in their decision making during the year.
STRATEGY DEVELOPMENT
- The Board continued to receive detailed briefings on the changing market dynamics in key defence markets, with particular focus on the shift in funding
priorities in the US in preparation for a peer-to-peer conflict, and the implications for the Group’s future strategy. The Board also reviewed the UK
Government’s Integrated Review Refresh 2023 and the Defence Command Paper subsequently published by the UK MOD, and considered how the
identified requirements aligned with the strategic objectives of the Group’s UK businesses.
- The Board receives updates from the Group Chief Executive on his regular interactions with the UK MOD and from the President of the US operations on
his interactions with key US customers. In addition, the Board receives regular feedback from the businesses on the emerging technology requirements of
their principal customers and future budget allocations. These inputs are all reflected in the development of strategy, and decisions regarding investment in
operational capabilities and research and development.
- In developing the Group’s strategy, the Board continues to recognise the need for investment in people, processes and products to ensure that the
businesses can operate safely for the benefit of all stakeholders, and allocates resources accordingly.
- The Board also considers feedback from shareholders when reviewing strategy, particularly with regards to capital allocation and future growth plans.
OPERATIONAL INVESTMENT IN ROKE
- A significant level of operational investment continues to be allocated to Roke, including a further investment in The Roke Academy to attract new talent and
create a centre of excellence for learning and development. The business has also invested in its infrastructure, including new offices in Woking and
Gloucester, which can together accommodate over 250 staff, and in the value proposition for its existing workforce. In approving this investment, the Board
considered how it would contribute to the longer-term success of Roke and the wider Group, and the benefits that would be derived by customers and
employees, particularly in relation to workforce diversity and career development prospects.
CAPITAL INVESTMENT IN THE ENERGETICS BUSINESSES
- The Board approved significant new capital investment programmes at the Energetics businesses in the UK, Norway and the US during the year, with
acombined value of £120m. In reviewing and approving these investments, the Board considered how it could satisfy the increased capacity needs of
customers and create safer working conditions for employees, whilst providing an appropriate return on investment for the Group’s shareholders.
TheBoard also considered how the environmental impact of new production facilities could be minimised and how changes in current and emerging
environmental regulations would be addressed.
IMPLEMENTATION OF ESG STRATEGY
- During the year, the Board continued to monitor progress against the ESG strategy adopted during 2021, with a particular focus on health, safety and the
environment, diversity and inclusion, reducing climate change impacts and employee wellbeing. This has driven investment in a number of areas, from capital
investment in upgraded new facilities to improve safety and reduce our environmental impact, to the establishment of development and networking
programmes focusedon promoting diversity across the Group. In approving these ongoing investments, the Board has considered the impacts on a wide
range of stakeholders, including employees, customers, regulators and our local communities.
> FURTHER DETAILS ON OUR APPROACH TO ESG CAN BE FOUNDONPAGES 38 TO 55
EXECUTIVE REMUNERATION
- In reviewing the executive directors’ remuneration arrangements for the current financial year, the Remuneration Committee assessed how they compared
with remuneration arrangements for employees more broadly across the Group, particularly with regards to salary increases, pension contributions and
incentive arrangements.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 87

EMPLOYEE ENGAGEMENT
Laurie Bowen is designated as the non-executive director who engages with
employees on behalf of the Board. Laurie held a number of meetings with
employees at all levels of the organisation within our UK and Norwegian
businesses during the year, at which she shared with employees aperspective
on the Board’s priorities and provided an opportunity for them to ask questions
of her. Whilst each meeting was different due to the diversity of the businesses
and the range of employees who participated in the discussions, the following
topics were typically addressed at every meeting:
- the role of the Board and its responsibilities, and, where appropriate,
theinteraction between the UK and the US Boards;
- application of the Group’s values, particularly in relation to safety;
- leadership and vision;
- communication and employee engagement;
- relationships with customers and other stakeholders;
- collaboration within the Group; and
- resourcing, training and employee development.
Feedback from these meetings is provided to the Board and is reflected on, as
appropriate, in Board decision making. Laurie also provides a high-level
overview of the feedback received, on a non-attributable basis, to the leadership
of the businesses involved. Further details on the key themes arising during
the year are set out on page 58.
During the Board visits to Chemring Energetics UK, Chemring Nobel and
Roke in the year, the Board members met informally with members of the
management teams and other employees. These interactions provided an
informal opportunity for open discussions on the operation of the Board and
the Group’s strategic priorities, and enabled the employees to talk about the
opportunities and challenges in their own businesses.
The Group Chief Executive engages in regular discussion forums with
employees during routine visits to the businesses, and other directors
alsoengage with employees during individual site visits.
The Board believes that its current mechanisms for engagement with
employees, including Laurie Bowen’s appointment as the non-executive
director lead on employee engagement, is currently proving effective, as
evidenced by the openness and quality of the discussions with employees.
When combined with the feedback on employee sentiment the Board
receives through Employee Voice and periodic culture “check-ins”, the Board
is confident that it receives meaningful input to its decision-making processes.
We will, however, continue to review the effectiveness of our approach to
engagement with employees and all of our stakeholders on an ongoing basis.
> FURTHER DETAILS ON EMPLOYEE ENGAGEMENT
MOREBROADLYCANBEFOUNDONPAGE 58
SHAREHOLDER ENGAGEMENT AND THE ANNUAL
GENERALMEETING
The Company operates a structured investor relations programme, focused
largely around the half and full year results announcements. Engagement with
shareholders during these sessions is predominantly led by the Group Chief
Executive, the Chief Financial Officer and the Group Director of Corporate
Affairs. Meetings were held with over 85 current and potential institutional
shareholders during the year, representing institutions in the UK, the US and
Canada. In addition to reviewing the results announcements, discussions
typically also cover the development of the Group’s strategy, capital allocation
and ESG-related matters.
The Chairman also met separately with a number of current institutional
shareholders during the year and shared feedback from these meetings with
the Board.
The Board also receives reports from the Company’s advisers on feedback
received from existing and potential investors and analysts following meetings
with the executive directors. Investor sentiment is a key input into development
of the Group’s strategy.
The Chair of the Remuneration Committee also engages with shareholders
on matters relating to executive remuneration from time to time. Whilst
there was no direct engagement during 2023, the Company’s larger institutional
shareholders were consulted on the new directors’ remuneration policy
which was presented to shareholders for approval at the Annual General
Meeting in March 2022. Further detail on how the Remuneration Committee
responded to the feedback received can be found in the directors’ remuneration
report included within the 2021 annual report.
The Annual General Meeting provides an opportunity for all shareholders
toengage directly with the Board. All directors are required to attend the
meeting and make themselves available to take questions from shareholders
or address any concerns raised by shareholders. All substantial issues, including
the adoption of the annual report and financial statements, are proposed on
separate resolutions at the Annual General Meeting. In line withbest practice
guidelines, voting at the Annual General Meeting is usually conducted by way
of a poll, which allows all votes to be counted, not just those of shareholders
who attend the meeting.
> FURTHER DETAILS ON THE BOARD’S ENGAGEMENT
WITHSHAREHOLDERS CAN BE FOUND ON PAGE 36
BOARD SITE VISITS
Site visits enable the Board to obtain a deeper understanding of the business
operations, establish relationships with the wider management team and engage
directly with employees. The Board generally receives a presentation from
management and views the facilities where safe to do so.
As referred to above, during the year, the Board as a collective visited Roke,
Chemring Energetics UK and Chemring Nobel in Norway. During each visit,
the Board received a presentation from the management on their business
performance, future strategy, and key opportunities and challenges. The
Board also participated insite tours of the two Energetics businesses and
reviewed the new facilities which had been established in the last few years.
Whilst the Board as a whole did not visit the US during 2023, the Group
Chief Executive and the Chief Financial Officer visited the US businesses on
anumber of occasions and the Chairman accompanied the Group Chief
Executive on a trip to the US to meet the US Board in November 2023.
TheBoard next plans to visit the US as a collective in April 2024.
LEADERSHIP OF THE US BUSINESSES AND THE US BOARD
Our US Board is established under our Special Security Agreement (“SSA”)
with the US Government and includes three independent US directors approved
by the US Government. The SSA imposes certain restrictions on the degree
of control and influence we can exert over our US businesses and it is imperative
that we maintain a strong relationship with the US Board, in order to ensure
that we are fulfilling our own governance obligations. The Group Chief Executive
and the Chief Financial Officer are both members of the US Board.
The President of our US operations joined several of our Board meetings
during the year. Our broader interaction with the US Board has increased in
recent years, and the increased collaboration continues to prove very beneficial
from both an operational and governance perspective. Our US Board also
collates and provides valuable feedback from a range of both internal and
external internal stakeholders in the US, and this is a key input into the
annualstrategy review.
CORPORATE GOVERNANCE REPORT continued
BOARD LEADERSHIP AND
COMPANYPURPOSE continued
Chemring Group PLC Annual report and accounts 202388

COMPOSITION OF THE BOARD AND INDEPENDENCE
The Board currently comprises four executive directors, pending Andrew
Lewis’ planned retirement from the Board on 31 December 2023, and six
non-executive directors (including the Chairman). The biographical details
ofindividual directors, including details of their other significant business
commitments, are set out on pages 82 and 83.
The Board considers all of the current non-executive directors to be
independent in judgement and character, and considered Carl-Peter Forster
to be independent on his appointment as Chairman.
The Board considers that the current balance of executive and non-executive
influence on the Board is appropriate for the Company, taking into account its
size and status, and serves to ensure that no single director or small group of
directors dominate the Board’s deliberations and decision making.
The roles of Chairman and Chief Executive are separate and clearly defined
inaccordance with the requirements of the Code, with the division of
responsibilities set out in writing and agreed by the Board.
TIME COMMITMENT OF DIRECTORS
The Board recognises the importance of ensuring that individual directors
have sufficient time available to discharge their duties effectively. Existing
commitments of prospective directors are carefully considered prior to
appointment and incumbent directors are required to notify the Chairman
or,in the case of the Chairman the Senior Independent Director, if there are
any significant changes to their external commitments.
APPROVAL OF DIRECTORS’ EXTERNAL APPOINTMENTS
In accordance with the Code, all proposed new external appointments of
directors require the approval of the Board.
During the year, the Board approved the following additional
externalappointments:
- Michael Ord’s appointment as a non-executive director of TT Electronics plc;
- Fiona MacAulay’s appointment as a non-executive director of Dowlais
Group plc; and
- Laurie Bowen’s appointment as a non-executive director of SBA
Communications Corporation.
In approving these appointments, the Board satisfied itself that each director
would continue to have the capacity to fulfil their obligations to the Group
following the respective appointments.
CONFLICTS OF INTEREST
All directors have a duty under the Companies Act 2006 (the “2006 Act”)
toavoid a situation in which he or she has or can have a direct or indirect
interest that conflicts or may possibly conflict with the interests of the
Company. The Company’s Articles of Association include provisions for
dealing with directors’ conflicts of interest in accordance with the 2006 Act.
The Company has procedures in place to deal with situations where
directorsmay have any such conflicts, which require the Board to:
- consider each conflict situation separately on its particular facts;
- consider the conflict situation in conjunction with the rest of their duties
under the 2006 Act;
- keep records and Board minutes as to authorisations granted by directors
and the scope of any approvals given; and
- regularly review conflict authorisation.
EXPERIENCE OF THE BOARD
The members of the Board also maintain the appropriate balance of
experience and knowledge of the business to enable them to discharge
theirduties and responsibilities effectively.
DIVISION OF RESPONSIBILITIES
NUMBER OF DIRECTORS WITH APPLICABLE SPECIFICEXPERIENCE
Manufacturing 8
Defence 5
Technology 5
International 10
Strategy 5
Marketing 5
Governance 5
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 89

BOARD ROLES AND RESPONSIBILITIES
The key responsibilities of the Board members are set out below.
CHAIRMAN
- Responsible for the leadership of the Board and ensuring its overall effectiveness in directing the Group
- Ensures that the Board is kept properly informed and is consulted in a timely manner on all decisions reserved to it
- Promotes a culture of openness and debate, and facilitates constructive relations between the executive and non-executive directors
- Ensures that the training and development needs of directors are identified
CHIEF EXECUTIVE
- Responsible for the leadership and day-to-day management of the business
- Develops strategy for Board approval and ensures that the agreed strategy is implemented successfully
- Presents the annual budget and five-year plan to the Board for approval and delivers agreed objectives
- Identifies new business opportunities, and potential acquisitions and disposals
- Manages the Group’s risk profile, including the management of health and safety
- Ensures that the Board is fully informed of all key matters
CHIEF FINANCIAL OFFICER
- Supports the Chief Executive in developing and implementing the global finance strategy
- Oversees the finance functions across the Group
- Ensures effective financial controls and financial reporting processes are in place
- Ensures the Group has adequate bank facilities and financial resources
SENIOR INDEPENDENT DIRECTOR
- Provides support to the Chairman and acts as a trusted sounding board
- Reviews the Chairman’s performance with the other non-executive directors
- Available to meet shareholders if they have concerns which cannot be resolved through the normal channels
NON-EXECUTIVE DIRECTORS
- Participate in the development of strategic objectives, provide constructive challenge and monitor the performance of executive management in achieving
theagreed objectives
- Monitor the Group’s financial performance
- Consider the integrity of the Group’s financial information, and whether the financial controls and risk management systems are robust and defensible
- Determine the appropriate remuneration policy for the executive directors
- Meet periodically with the Group’s senior management and visit operations
- Meet regularly without the executive directors being present
LEGAL DIRECTOR & COMPANY SECRETARY
- Oversees legal matters and compliance across the Group
- Secretary to the Board and its committees
- Under the direction of the Chairman, responsible for maintaining good information flows within the Board and its committees
- Develops Board and committee agendas, and collates and distributes papers
- Assists with the induction of new directors
- Keeps directors informed about changes to their duties and responsibilities
- Provides advice on legal, regulatory and corporate governance matters
CORPORATE GOVERNANCE REPORT continued
DIVISION OF RESPONSIBILITIES continued
Chemring Group PLC Annual report and accounts 202390

The following table shows the attendance of all directors who served during the year at the meetings of the Board and its committees:
Board member
Board
(8 scheduled
meetings)
Audit Committee
(5 scheduled
meetings)
Nomination
Committee
(2 scheduled
meetings and
5 ad hoc meetings)
Remuneration
Committee
(2 scheduled
meetings and
1 ad hoc meeting)
CARL-PETER FORSTER 8(8) — 5(7) 3(3)
ALPNA AMAR 2(2) 1(1) 2(2) —
LAURIE BOWEN 8(8) 5(5) 7(7) 3(3)
ANDREW DAVIES 8(8) 5(5) 7(7) 3(3)
SARAH ELLARD 8(8) — — —
STEPHEN KING 8(8) 5(5) 7(7) 3(3)
ANDREW LEWIS 8(8) — — —
FIONA MACAULAY 8(8) 4(5) 7(7) 3(3)
MICHAEL ORD 8(8) — — —
The maximum number of meetings which each director could have attended is shown in brackets. All directors attended all scheduled Board meetings.
During the year, the Chairman met regularly with the non-executive directors without the executives being present.
BOARD MEETINGS AND ATTENDANCE
The Board convenes for scheduled meetings at
least seven times a year. The Board receives a
report from the Executive Committee,
covering health and safety performance,
strategic development, operational and
financial performance, legal, people and
investor relations related issues, asa standing
agenda item at every scheduled meeting.
Members of the senior leadership team,
representatives of the US Board and external
advisers attend Board meetings by invitation,
as appropriate.
The Board aims to meet jointly with the
Group’s US Board, further details of which are
set out on page 88, at least once ayear.
BOARD AND COMMITTEE MEETINGS
HELD DURING THE YEAR
Board
Audit
Nomination
Remuneration
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 91
November December January February March April May June July September
4
3
2
1
0

BOARD APPOINTMENTS AND RE-ELECTION OF DIRECTORS
New appointments to the Board and its committees are made by the Board
on the recommendation of the Nomination Committee.
In accordance with the Company’s Articles of Association, all directors are
required to submit themselves for re-election at each Annual General
Meeting. The papers accompanying the Notice of Annual General Meeting
include a statement from the Chairman confirming that the performance of
each non-executive director seeking re-election at the meeting continues to
be effective and that each director continues to demonstrate commitment
totheir role.
DIVERSITY
The Board recognises the importance of promoting diversity in its broadest
sense, both at the Board level and across the entire business, and we remain
committed to further improving diversity on the Board, the Executive
Committee and the wider senior leadership team.
> FURTHER DETAILS ON THE BOARD’S POLICY AND APPROACH TO
DIVERSITY ARE SET OUT IN THE NOMINATION COMMITTEE REPORT
ON PAGES 98 AND 99.
INDUCTION, TRAINING AND DEVELOPMENT
An internal induction programme on the Group’s operations, and its strategic
and business plans, is provided for newly-appointed directors. Directors are
invited to meet key members of the senior management team at the earliest
opportunity, and site visits are arranged to facilitate their understanding of the
Group’s operations.
The Group Legal Director & Company Secretary also provides detailed
information on the operation of the Board and its committees, directors’
legalduties, and responsibilities on appointment.
OVERVIEW OF INDUCTION PROGRAMME PROVIDED TO ALPNA AMAR
Alpna Amar joined the Board in June 2023. As part of her induction
programme, Alpna spent time with the executive directors receiving a
detailed brief on the Group’s operations and also met with members of
the Executive Committee to develop an understanding of their respective
areas of responsibility. Alpna visited three of our sites in the UK and our
business in Norway during the year and, in November 2023, she visited
Chemring Energetic Devices and Kilgore in the US. At each of the site
visits, Alpna was given a tour of the facilities and received a presentation
from the management on the business. Alpna also received a briefing
fromthe Group’s external lawyers on her duties and responsibilities as
adirector of a UK listed company.
The Company meets the cost of appropriate external training for directors,
the requirement for which is kept under review by the Chairman.
Directors are continually updated on the Group’s businesses and the matters
affecting the markets in which they operate. The Group Legal Director &
Company Secretary updates the Board on a regular basis with regards to
regulatory changes affecting the directors and the Group’s operations generally,
and briefings are provided by the Group’s advisers on key developments in
areas such as financial reporting and executive remuneration practice.
INDEPENDENT ADVICE
All directors are entitled to take independent professional advice in
furtherance of their duties at the Company’s expense, should the need
arise.No director had reason to seek such advice during the year.
PERFORMANCE EVALUATION
The Code recommends that the performance evaluation of the Board be
externally facilitated at least every three years. The Board selected Gould
Consulting, who have no other relationships with the Group, to facilitate
theevaluation during the year.
Questionnaires covering the activities of the Board and its three main
committees were sent to each of the directors for completion and
abbreviated questionnaires were also sent to the UK members of the
Executive Committee. The questionnaires for the Board focused on:
- strategy development and implementation;
- the Group’s ESG plans and objectives;
- the Board’s role in setting and monitoring the Group’s purpose, culture
andvalues;
- stakeholder engagement;
- operation of the Board and its committees;
- the role of the Chair and effectiveness of meetings;
- the composition of the Board and its diversity;
- the Board’s oversight of risk management systems and internal controls; and
- areas in which the Board could improve its effectiveness.
The questionnaires provided to the Executive Committee members focused
on their perceptions of the Board and its activities, and their interactions with
the Board members.
Following receipt of the completed questionnaires, the principals of Gould
Consulting participated in one-to-one meetings with each of the directors
and the three Executive Committee members to discuss their responses.
Each of the participants was also invited to raise any other matters or put
forward any additional recommendations not covered in their responses to
the questionnaires.
The responses were consolidated into a report which was discussed with the
Chairman and the Group Chief Executive prior to sharing with the remainder
of the Board. Specific comments from directors were not attributed to individuals
in order to provide full transparency on the responses. The report also
benchmarked the Board’s assessment of its effectiveness in the areas covered
by the Board questionnaire against similar assessments completed by Gould
Consulting’s wider portfolio of clients. The Board met or exceeded the target
best practice benchmark in eight of the ten areas covered by the questionnaire.
The evaluation confirmed that the Board is functioning effectively overall and,
with the most recent appointments, the balance of skills and experience on
the Board affords it a level of maturity in the way it conducts itself. The
evaluation identified several areas in which the Board could improve its
effectiveness and the Board therefore intends to prioritise the following
activities in the year ahead:
- planning for the transition of the Chairman and the Senior Independent
Director, and further evolving the succession plans for the executive directors;
- continuing development of the Group’s longer-term ambition and
growthstrategy;
- increasing the strategic focus on the Group’s US businesses;
- establishing strategic goals and milestones by which implementation of the
Group’s strategy can be more effectively monitored; and
- further increasing the level of interactions between the non-executive
directors outside of scheduled Board meetings and increasing the level of
interactions between the Board and the Executive Committee members.
The report provided by Gould Consulting also identified some practical
waysin which the focus of Board meetings and the quality of the debate at
the meetings could be enhanced, such as the increased use of signposting in
papers presented to the Board and restructuring the format of presentations
to the Board to ensure that key points for discussion are prioritised. These
will also be addressed in the year ahead.
In addition to the formal performance evaluation, the Chairman and
non-executive directors also reviewed the individual performance of the
executive directors as part of the annual remuneration review.
CORPORATE GOVERNANCE REPORT continued
COMPOSITION, SUCCESSION
ANDEVALUATION
Chemring Group PLC Annual report and accounts 202392

AUDIT, RISK AND
INTERNALCONTROL
FINANCIAL AND BUSINESS REPORTING
The statement of directors’ responsibilities in respect of the financial
statements and accounting records maintained by the Company is set out
onpage 125.
Having taken all the matters considered by the Board and brought to the
attention of the Board during the year into account, the Board is satisfied that
the annual report and accounts for the year ended 31 October 2023, taken
as a whole, is fair, balanced and understandable. Furthermore, the Board
believes that the disclosures set out on pages 1 to 78 provide the information
necessary to assess the Company’s performance, business model and strategy.
RISK MANAGEMENT AND INTERNAL CONTROL
The Board is responsible for determining the nature and extent of the risks
that it is willing to take to achieve its strategic objectives. The Board is also
responsible for ensuring that the Group’s risk management and internal
control systems are effective across the businesses, and that appropriate
riskmitigation plans are in place.
The Board undertakes an annual review of the effectiveness of the Group’s
systems of internal control, including financial, operational and compliance
controls, and risk management systems. Further details of the review
undertaken during the financial year ended 31 October 2023 are set out
onpage 68.
OPERATIONAL FRAMEWORK
Our Operational Framework incorporates a broad range of policies and
procedures which have been adopted by all of our businesses, and provides
an enhanced governance structure to enable us to operate in a safe, consistent
and accountable way. As part of this enhanced governance structure, there
isa requirement for all businesses to complete a detailed Operational
Assurance Statement on an annual basis, providing an assessment of their
compliance with the Operational Framework.
The output from the operational assurance process provides assurance to the
Board that our internal systems and controls are operating effectively, and is
an important input to our internal audit and risk management activities.
AUDIT
Details of the Group’s external and internal audit activities can be found in
the Audit Committee report onpages 94 to 97.
LONG-TERM VIABILITY STATEMENT
The Code requires the Board to undertake an annual assessment of the
long-term viability of the Group, further details of which can be found on
page 77.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 93

Chemring Group PLC Annual report and accounts 202394
AUDIT COMMITTEE REPORT
PROVIDING GUIDANCE TO THE BOARD
Stephen King
Chairman of the Audit Committee
AUDIT COMMITTEE MEMBERS
Stephen King (Chairman)
Alpna Amar (appointed 13 June 2023)
Laurie Bowen
Andrew Davies
Fiona MacAulay
INTRODUCTION
I am pleased to present my report as Chairman of the Audit Committee.
The Audit Committee continues to play a critical role in the governance of
the Group’s financial affairs, both through monitoring the integrity of the
Group’s financial reporting and reviewing material financial reporting
judgements. The report provides an overview of the operation of the
Committee and its activities during the year. During the early part of the
financial year, the Committee was focused on matters relating to the 2022
financial statements, which were covered in detail in last year’s report. This
year’s report therefore focuses on the Committee’s activities in relation to
the 2023 half year and full year results, and the external and internal audit
activities during 2023.
MEMBERSHIP OF THE AUDIT COMMITTEE
The Audit Committee has been established by the Board and is responsible
for monitoring the integrity of the Group’s financial statements and the
effectiveness of the internal and external audit process.
All members of the Committee are independent non-executive directors,
and each brings a broad range of financial and business expertise. I have
previously served as the finance director of substantial public companies,
andtherefore possess recent and relevant financial experience. The Board
considers that the Committee members possess an appropriate level of
independence and offer a depth of financial and commercial experience
across various industries, in particular within the defence, technology and
manufacturing sectors. The appointment of Alpna Amar, who is a Chartered
Accountant, as an additional non-executive director and a member of the
Committee has further strengthened the expertise on the Committee this year.
OPERATION OF THE COMMITTEE
The Committee’s full responsibilities are set out in its terms of reference,
which are available on the Company’s website. The Committee reviews its
terms of reference and its effectiveness annually and recommends to the
Board any changes required as a result of the review.
Meetings of the Committee are attended, at the invitation of the Chairman,
by the external auditor, the Chairman of the Board, the Group Chief Executive,
the Chief Financial Officer, the internal auditor and representatives from the
Group finance function. The Committee meets with the external and internal
auditors on a regular basis without the executive directors being present.
TheGroup Legal Director & Company Secretary acts as secretary to the
Committee and minutes of meetings are circulated to all Board members.
> DETAILS OF ATTENDANCE OF MEMBERS OF THE COMMITTEE AT THE
FIVE MEETINGS HELD DURING THE YEAR ARE SHOWN ON PAGE 91
KEY RESPONSIBILITIES OF THE AUDIT COMMITTEE
- Monitoring the integrity of the Group’s financial statements and any
formal announcements relating to the Group’s financial performance,
and reviewing the appropriateness of significant financial reporting judgements
- Providing guidance to the Board in its consideration of whether the
annual report and accounts are fair, balanced and understandable
- Making recommendations on the appointment, reappointment and
remuneration of the internal and external auditors
- Ensuring that an appropriate relationship between the Group and
theexternal auditor is maintained, and overseeing the provision of
non-audit services
- Reviewing and monitoring the external auditor’s independence,
objectivity and effectiveness
- Reviewing the effectiveness of the Group’s internal controls and risk
management systems
- Considering the effectiveness of the Group’s internal audit function and
monitoring internal audit activities

SIGNIFICANT ISSUES CONSIDERED BY THE COMMITTEE
INRELATION TO THE FINANCIAL STATEMENTS
DISCONTINUED OPERATIONS
Following a strategic review of the Group’s US Sensors business as a result
ofthe US DoD’s decision in 2022 to transition the HMDS Program of
Record to sustainment earlier than anticipated, a decision was taken to
exit the explosive hazard detection (“EHD”) business. The Committee
considered the requirements of IFRS 5 Non-current Assets Held for Sale and
Discontinued Operations and agreed that the EHD business should be
treated as a discontinued operation in the 2023 financial statements.
Inaddition, having concluded that it was no longer probable that the US
Sensors business would secure a Program of Record for its chemical
detection system, the Committee also considered the appropriate
treatment of the chemical detection line of business and agreed with
theexternal auditor that this line of business should be presented
withincontinuing operations in the 2023 financial statements.
RECOVERABILITY OF GOODWILL, OTHER INTANGIBLE
ASSETS, AND THE PARENT COMPANY’S INVESTMENTS
IN,AND INTERGROUP RECEIVABLE BALANCES
WITH,SUBSIDIARIES
The Committee considered the carrying value of goodwill, intangible
assets and the parent company’s investments in, and intergroup receivable
balances with, subsidiaries held on the balance sheet as at 30 April 2023
and 31 October 2023, against the latest forecasts for the businesses
concerned and the future strategic plan for the Group. As referenced
above, following the decision to exit the EHD business, the Committee
agreed that there was a requirement for a non-cash impairment of the
goodwill of £20.5m associated with the acquisition of the business in
2009to be recognised in the Group’s consolidated income statement
forthe year ended 31 October 2023. The value of other assets held
inrespect of the EHD business, totalling £10.7m, was also impaired.
CAPITALISED DEVELOPMENT COSTS
The Committee continued to monitor the level of development costs
capitalised during the year and the periods over which such costs are to
be amortised. Detailed reviews of the Group’s most significant research
and development projects, and their associated capitalised development
costs, were undertaken by the Committee in April 2023, September 2023
and November 2023. As a result of these reviews and the decisions taken
in relation to the US Sensors business referenced above, an impairment
charge of £15.6m was recognised at 31 October 2023 in respect of
capitalised development costs associated with the chemical detection line
of business and an impairment charge of £0.7m was recognised in respect
of capitalised development costs associated with the EHD line of business.
NON-UNDERLYING ITEMS AND ALTERNATIVE
PERFORMANCE MEASURES
Following discussions with the external auditor, the Committee agreed
that it would be appropriate for the impairment charges of £18.5m
associated with the chemical detection line of business and the impairment
charges and site rationalisation costs of £32.9m associated with the EHD line
of business to be presented as non-underlying items in the Group’s 2023
financial statements. The Committee reviewed the use of alternative
performance measures in the interim results statement and the annual
report. The Committee concluded that the use of alternative
performance measures did enhance a reader’s understanding of the
accounts and that they were presented in a fair, balanced and
understandable manner.
ACCOUNTING FOR THE ACQUISITION OF GEOLLECT
The Committee considered and approved the accounting treatment of
the Group’s acquisition of Geollect Limited in December 2022.
A verbal report on key issues discussed by the Committee is provided to
theBoard after every meeting.
The Chairman of the Committee meets regularly with the Chief Financial
Officer, the external audit lead partner and the internal auditor outside of
scheduled meetings.
The Committee is authorised to seek any information it requires from any
employee of the Group in order to perform its duties, and to obtain any
outside legal or other professional advice it requires at the Company’s expense.
THE COMMITTEE’S ACTIVITIES DURING THE YEAR
AREAS OF FOCUS MATTERS CONSIDERED
FINANCIAL
REPORTING
- Content of the Group’s interim and preliminary
results announcements and the annual
report, and in particular, whether the annual
report was fair, balanced and understandable
- Appropriateness and disclosure of accounting
policies, key judgements and key estimates
- The presentation of alternative
performancemeasures
- The Group’s going concern status and
viability statements
- The Group’s environmental performance
reporting and the related assurance review
completed by ERM
- Financial Reporting Council ("FRC")
thematicreviews
RISK AND CONTROL
ENVIRONMENT
- Effectiveness of the Group’s systems of
internal control
- UK Government and FRC proposals on audit
and corporate governance reforms
EXTERNAL AUDIT - Interim review and full year audit plans
- Effectiveness and independence of the
external auditor
- Non-audit services provided by the
externalauditor
- External auditor’s reports on the half year
and full year results, and consideration of
points raised by the auditor
INTERNAL AUDIT - Internal audit strategy and plan
- Key findings of internal audits and progress
against actions arising
- Effectiveness of the internal audit programme
The Committee relies on regular reports from the executive directors, the
wider management team, and the external and internal auditors in order to
discharge its responsibilities. The Committee is satisfied that it received timely,
sufficient and reliable information to enable it to fulfil its obligations during the year.
FINANCIAL REPORTING
A summary of the significant issues considered in relation to the 2023
financial statements is set out below.
The Committee also reviewed the reports issued by the FRC on their thematic
reviews of financial reporting and disclosures relating to fair value measurement
and Task Force on Climate-Related Financial Disclosures (“TCFD”) metrics
and targets, and considered how the matters raised had been addressed in
the 2023 financial statements. In addition, the Committee considered whether
the Company had appropriately addressed the findings of the FRC’s annual
review of corporate reporting, which was published in October 2023, in the
2023 financial statements.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 95

SIGNIFICANT ISSUES CONSIDERED BY THE COMMITTEE
INRELATION TO THE FINANCIAL STATEMENTS continued
The Committee is required to consider whether it is appropriate to adopt
the going concern basis in preparing the interim and full year results. In order
to satisfy itself that the Group has sufficient financial resources to enable it to
continue trading for the foreseeable future, the Committee regularly reviews
the adequacy of the Group’s financing facilities against future funding
requirements and working capital projections. Based on its review of the
Group’s forecasts during the year and discussions with the external auditor,
the Committee recommended to the Board the adoption of the going
concern basis for the preparation of the interim and full year results.
The Group is also required to make a statement on its long-term viability in
the financial statements. The Committee considered the period over which
the Group’s viability would be assessed and having concluded that a three-year
period was appropriate, the Committee undertook a review of the analysis
and projections which supported the viability assessment prior to submission
to the Board. Further details on the assessment process and the Group’s
long-term viability statement are set out in the strategic report on page 77.
Since the year end, the Committee has reviewed the form and content of the
2023 annual report and accounts, and recommended to the Board that, taken
as a whole, the annual report and accounts should be considered as fair, balanced
and understandable. The Committee also concluded that the annual report
and accounts provides the information necessary to assess the Group’s
position and performance, business model and strategy.
In making this assessment, the Committee considered:
IS THE REPORT FAIR?
- Is the narrative in the strategic report consistent with the
financialstatements?
- Have any significant matters been omitted?
IS THE REPORT BALANCED?
- Has appropriate prominence been given to both positive and
negativeaspects of performance during the year?
- Is there an appropriate balance between the disclosure of
statutorymeasures of performance and alternative performance
measures (“APMs”)?
IS THE REPORT UNDERSTANDABLE?
- Is the presentation of performance clear, with consistent use
ofkeyperformance indicators?
- Is there clarity around the use of APMs?
PROPOSED AUDIT AND CORPORATE GOVERNANCE REFORMS
In late 2021, in response to the UK Government’s White Paper on “Restoring
trust in audit and corporate governance”, the Group initiated aproject
focused on the development of an improved internal control framework to
ensure that processes, risks and controls were established anddocumented in
a consistent way across the Group. The new control framework was reviewed
and approved by the Committee for implementation by the businesses with
effect from 1 November 2022, and has contributed to a notable improvement
in the internal control environment across the Group over the last year.
The Committee reviewed the proposed changes to the UK Corporate Governance
Code (the “Code”) which were published by the FRC in May 2023, with
particular reference to the changes that were intended to implement the UK
Government’s governance reforms in relation to companies’ internal control
frameworks. The Committee was satisfied that the new framework implemented
by the Group would assist the businesses with compliance with the proposed
new requirements at that time. The FRC has since announced that it now
intends to issue a more limited update to the Code and further detail is
awaited. It is noted that the UK Government has also now withdrawn its
proposed new legislation which would have introduced additional reporting
requirements, including an annual resilience statement, distributable profits
figure, material fraud statement, and triennial audit and assurance policy statement.
The Committee has considered the “Audit Committees and the External
Audit: Minimum Standard” published by the FRC in May 2023 and is taking
steps to apply the Standard where appropriate prior to it becoming mandatory.
EXTERNAL AUDIT
The Audit Committee is responsible for making recommendations to the
Board on the appointment, reappointment and removal of the Company’s
external auditor. The Committee also undertakes an annual assessment of
theauditor’s independence and objectivity, taking into account relevant
professional and regulatory requirements and the relationship with the
auditor as a whole, including the provision of any non-audit services.
AUDIT EFFECTIVENESS
The Committee assesses the effectiveness of the external auditor on an
ongoing basis, with particular reference to:
- the arrangements for ensuring the external auditor’s independence
andobjectivity;
- the external auditor’s fulfilment of the agreed audit plan and any variations
from the plan in terms of timing and scope;
- the quality of the resource engaged by the external auditor to fulfil the
auditplan;
- the robustness and perceptiveness of the auditor in their handling of the
keyaccounting and audit judgements, and their willingness to challenge both
management and the Committee;
- the effectiveness of co-ordination of the individual business unit audits
onaglobal basis;
- the content of the external auditor’s reports and internal
controlrecommendations;
- their proactivity in briefing the Committee on proposed regulatory changes
and the implications for the Group; and
- the feedback received on the conduct of the external audits from key
people involved in the audit process in the central finance function and
within the businesses.
During the year, the Committee also reviewed the results of the 2023
assessment of KPMG’s audits which was undertaken by the FRC’s Audit
Quality Review team, and will continue to review these assessments onan
annual basis.
There are no contractual or similar obligations to restrict the choice of
external auditor.
KPMG was appointed as the Group’s external auditor in March 2018, following
a tender process, and continues to act as the external auditor for the Group
and all of the Group’s principal trading businesses. Andrew Campbell-Orde,
the lead audit partner on the appointment of KPMG, completed his fifth
yearin the role following the audit for the 2022 financial year and a new
auditpartner, James Childs-Clarke, therefore assumed responsibility for the
Group’s audit for the 2023 financial year. Mr Childs-Clarke was the Director
on the Group’s audit from 2018 to 2020 and therefore has a good level of
knowledge of the Group’s businesses and their financial reporting arrangements.
Having not been involved in the 2021 or 2022 audits, Mr Childs-Clarke is
considered independent.
The audits of the Group’s US businesses are carried out by KPMG US under
a separate engagement letter in order to satisfy the requirements of our Special
Security Agreement with the US Government. KPMG’s UK and US audit
teams need to co-ordinate their work to ensure that the audit of the consolidated
Group results at the year end can be completed efficiently. In order to facilitate
this, the annual audit plan continued to provide for planning work for the 2023
year-end audits of the US businesses to commence in the first half year of the
financial year, which enabled the Group audit to be completed within the
requisite timeframe following the year end. Mr Childs-Clarke visited our US
business, Chemring Energetic Devices, early in 2023 to enhance his understanding
AUDIT COMMITTEE REPORT continued
Chemring Group PLC Annual report and accounts 202396

of the business and associated risk, and this also provided an opportunity to
meet with the wider US leadership.
Mr Childs-Clarke was also involved with the selection of new audit responsible
individuals for each of our non-UK businesses, all of whom were newly
appointed following completion of the five-year term of their predecessors.
During the year, Monahans (Sumer AuditCo Limited) was appointed as the
external auditor of Vigil AI Limited, one of the Group’s smaller subsidiaries
which also has a minority shareholder. Vigil AI Limited does not make a
material contribution to the Group’s results and following discussions with
theminority shareholder, it was concluded that the audit would be more
appropriately carried out by a smaller firm such as Monahans. KPMG have
confirmed that Vigil AI Limited is immaterial to the Group financial statements
and as such do not require any reporting from Monahans for that purpose.
The Committee did not ask KPMG to review any specific areas of concern,
outside of the normal audit process, during the year.
No significant internal control failings or weaknesses were identified by KPMG
during the year but KPMG did challenge management on how certain cultural
issues and employee behaviours identified at one of the businesses during the
year might have impacted the business more generally and, in particular, its
internal control environment. KPMG conducted enquiries with senior personnel
at the business and within the central head office function, and undertook a
high-level review of the Group’s whistleblowing processes as part of their
assessment, and were satisfied that the issues which had arisen did not
amount to a control deficiency. In the normal manner, KPMG identified a
small number of uncorrected review misstatements as part of their half year
review and year-end audit. Having considered the representations made by
KPMG, the Committee was satisfied that the Group had adopted an appropriate
approach in each case and that the impact of the misstatements identified by
KPMG was not material.
The Committee reviewed KPMG’s overall effectiveness in fulfilling the
external audit during the year, having reflected on all of the matters set
outabove, and concluded that KPMG had conducted a comprehensive,
appropriate and effective audit.
The Committee has recommended to the Board that KPMG be reappointed
as the Group’s auditor at the 2024 Annual General Meeting.
The Company is in compliance with the provisions of The Statutory Audit
Services for Large Companies Market Investigation Order 2014.
AUDITOR INDEPENDENCE
The Committee keeps under review the level of any non-audit services which
are provided by the external auditor, to ensure that this does not impair their
independence and objectivity.
The Committee has adopted a policy which states that the external auditor
should not be appointed to provide any non-audit services to the Group,
unless the Committee agrees that their appointment would be in the best
interests of the Company’s shareholders in particular circumstances and
would not create any direct conflict with their role as external auditor. In
approving any such appointment, the Committee is also required to consider:
- whether the provision of the proposed services might compromise the
auditor’s independence or objectivity;
- whether the non-audit services will have a direct or material effect on the
Group’s audited financial statements;
- whether the skills and experience of the external auditor make it the most
suitable supplier of the non-audit services; and
- the level of fees proposed for the non-audit services relative to the audit fees.
The external auditor is required to provide the Committee with a written
confirmation of independence for all duly-approved engagements for
non-audit services.
The policy adopted by the Committee expressly prohibits the provision of
certain non-audit services by the external auditor, in line with regulatory
requirements and UK ethical guidance.
Details of the amounts paid to KPMG during the year for audit and non-audit
services are set out in note 4 to the Group financial statements. Total fees of
£0.1m were paid to KPMG during the year in respect of non-audit services,
which related to the review of the interim results and an audit report for
Chemring Nobel’s tax return as is required from the auditor under Norwegian
tax law. The Committee concluded that neither the nature or scope of these
services gave rise to any concerns regarding the objectivity orindependence
of KPMG.
The Committee, in conjunction with the Chief Financial Officer, ensures that
the Group maintains relationships with a sufficient choice of appropriately
qualified alternative audit firms for the provision of non-audit services. Building
these relationships also ensures that the Group will have a reasonable choice
of other suitable external audit firms when it next tenders the external audit.
INTERNAL AUDIT
The Audit Committee is responsible for reviewing the work undertaken
bythe Group’s internal auditor, assessing the adequacy of the internal audit
resource, and recommending changes for increasing the scope of the internal
audit activities.
The Group’s internal audit programme incorporates a review of all sites
onatwo or three-year rotational basis, and focuses on both financial and
non-financial controls and procedures. The Committee approves the annual
internal audit plan and receives regular reports from the internal auditor.
As referred to in last year’s report, a decision was taken to establish an
in-house internal audit function with effect from 1 November 2022. A new
Internal Audit Manager, who reports to the Chairman of the Audit Committee,
was therefore appointed in May 2023. The Internal Audit Manager is now
responsible for conducting internal audits across the Group, with the support
of other suitably-qualified Group employees where appropriate. This facilitates
sharing of best practice across the Group and contributes to the development
of employees involved in the audits. The Internal Audit Manager’s activities
will continue to be supplemented in specialist areas, such as IT and cyber-security,
with more focused assurance reviews by external experts.
The internal audit plan for 2023 included specific focus on:
- the key financial and operating controls within the business;
- IT and cyber-security governance and controls; and
- compliance with the Group’s Bribery Act Compliance Manual.
No significant internal control failings or weaknesses were identified during
the internal audits completed in the year.
An update on internal audit activities is presented to the Committee at each
meeting. The management of each business is responsible for implementing
the recommendations made by the internal audit function, and the Committee
reviews progress on a regular basis. Progress on addressing internal audit
findings is also reviewed by the Group Chief Executive and the Chief Financial
Officer in their quarterly reviews with each of the businesses.
The Committee reviews the Group’s approach to internal audit on an annual
basis to ensure that it remains fit for purpose and provides the requisite level
of assurance to the Committee.
Stephen King
Chairman of the Audit Committee
12 December 2023
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 97

NOMINATION COMMITTEE REPORT
Carl-Peter Forster
Chairman of the Nomination Committee
OPERATION OF THE COMMITTEE
The Committee’s responsibilities are set out in its terms of reference, which
are available on the Company’s website. The Committee reviews its terms of
reference and its effectiveness annually, and recommends to the Board any
changes required as a result of the review.
Meetings of the Committee are attended, at the invitation of the Chairman,
by the Group Chief Executive when considered appropriate. Members of
theCommittee do not participate in any discussions relating to their own
reappointment or replacement. The Group Legal Director & Company
Secretary acts as secretary to the Committee and minutes of meetings
arecirculated to all Board members.
> DETAILS OF ATTENDANCE OF MEMBERS OF THE COMMITTEE AT THE
SEVEN MEETINGS HELD DURING THE YEAR ARE SHOWN ON PAGE 91
BOARD COMPOSITION
The Committee regularly reviews the composition and balance of the Board
and its committees, and considers non-executive directors’ independence,
whether the balance between non-executive and executive directors remains
appropriate, and whether the Board has the requisite skills and experience
tooversee delivery of the agreed strategy for the Group.
The Board appointed an additional non-executive director, Alpna Amar,
during the year to further improve diversity on the Board. James Mortensen
was also appointed to the Board on 1 November 2023 and will replace
Andrew Lewis as Chief Financial Officer with effect from 1 January 2024.
Andrew, who is retiring, will step down from the Board on 31 December
2023 and will leave the Group on 19 January 2024.
The recently-completed Board performance evaluation, further details of
which are set out on page 92, considered the current composition of the
Board and concluded that no further changes were required at present,
recognising that both I and Andrew Davies, the Senior Independent Director,
will step down from the Board in early 2025, following the conclusion of our
third three-year appointments.
APPOINTMENTS TO THE BOARD
The Committee is responsible for reviewing and recommending new appointments
to the Board, and for considering the reappointment of current directors.
With regards to the appointment of new directors to the Board, the
Committee has an established process for identifying the attributes, skills and
experience required of potential candidates. External recruitment consultants
are engaged to undertake the search and provide an initial long list of potential
candidates, which is reviewed by the Committee. Members of the Committee
then meet with short-listed candidates, before selecting a small number of
preferred candidates to meet with other members of the Board. The searches
for a new Chief Financial Officer and for an additional non-executive director,
which were both instigated during the year, were conducted in this manner.
Further details are set out below. A similar external search will also be undertaken
for my successor and following completion of a selection process involving
three firms, Russell Reynolds have been retained for this purpose.
Following the announcement by Andrew Lewis in January 2023 that he intended
to retire as Chief Financial Officer on completion of his 12 month notice
period, Russell Reynolds were appointed by the Committee to undertake the
search for his replacement. Russell Reynolds were selected by the Committee
in view of their contemporary knowledge of the Group, having recruited two
non-executive directors in 2018 and 2019, and their understanding of the
Board’s requirements. A candidate brief was drawn up, following which
Russell Reynolds provided an initial long-list of potential candidates, which
wasreviewed by the Group Chief Executive and members of the Committee.
From this list, members of the Committee and the Group Chief Executive
selected four short-listed candidates, one of whom was an internal candidate,
based on their respective skills and experience against the initial brief. Consideration
was also given as to how each of the candidates would complement the Board.
The Committee invited James Mortensen as the preferred candidate to meet
the rest of the Board and having considered feedback from all of the directors,
the Committee made a recommendation to the Board to appoint James.
NOMINATION COMMITTEE MEMBERS
Carl-Peter Forster (Chairman)
Alpna Amar (appointed 13 June 2023)
Laurie Bowen
Andrew Davies
Stephen King
Fiona MacAulay
KEY RESPONSIBILITIES OF THE NOMINATION COMMITTEE
- Reviewing the structure, size and composition of the Board, and making
recommendations on appointments to the Board and to Board committees
- Reviewing the overall leadership needs of the organisation
- Oversight of the Group’s diversity policy
- Succession planning for the Board, the Executive Committee and
thewider leadership team
INTRODUCTION
I am pleased to present the Nomination Committee’s report for the year
ended 31 October 2023.
The recruitment of a new Chief Financial Officer and a new non-executive
director were key activities for the Committee during the year. The
Committee also continued to focus on the development of the Group’s
diversity, equity and inclusion (“DE&I”) strategy and succession planning for
the Board and the wider leadership team.
The Committee also considered the reappointments of various members of
the Board and commenced planning for the recruitment of my successor,
recognising that my third three-year term as Chairman will terminate in early
2025. Further details are set out below.
MEMBERSHIP OF THE COMMITTEE
The Nomination Committee’s key role is to ensure that the Board has the
appropriate skills, knowledge and experience to operate effectively and
deliver the Group’s strategy.
All members of the Committee are independent non-executive directors.
Ichair the Committee but will not do so where the Committee is dealing
with my own reappointment or my replacement as Chairman of the Board.
Chemring Group PLC Annual report and accounts 202398

A similar approach was adopted by the Committee in relation to the
appointment of Alpna Amar as an additional independent non-executive
director during the year. Odgers were appointed by the Committee to
prepare a candidate brief and undertake the search, with emphasis on the
requirement for increased diversity of gender and/or ethnicity on the Board.
Following initial interviews of four short-listed candidates by the members of
the Committee and the Group Chief Executive, two preferred candidates
were invited to meet the rest of the Board, who unanimously agreed to
appoint Alpna based on her experience and skill set.
Both Russell Reynolds and Odgers, each of which have no other connections
with theGroup, are signatories to the Voluntary Code of Conduct for Executive
Search Firms and have each made a commitment to promoting diversity.
Fiona MacAulay’s first three-year appointment as a non-executive director
expired in June 2023 and after due consideration of her valuable contribution
to the Board and its committees, the Committee recommended to the Board
that Fiona be reappointed for a second three-year term.
DIVERSITY, EQUITY AND INCLUSION
DIVERSITY POLICY
The Committee recognises the importance of diversity, equity and
inclusion to the effective performance of the Board, and to our wider
business operations. We are committed to promoting diversity
acrossthe Group in all forms, including diversity of gender, race, age,
disability, neurodiversity, sexual orientation, education, social and
cultural background, and belief.
From an overall Group perspective, we have set a target of increasing the
proportion of females in all senior management positions across the businesses
to at least 33% by 2027. Various initiatives have been instigated over the last
two years to support delivery of this target, including the provision of
diversity and inclusion training for all of our senior leaders and the
participants in our various development programmes, and the establishment
of the Women’s Inclusivity Network (WIN@Chemring). A number of these
activities continue to be supported by our female Board members.
> FURTHER DETAILS OF THE PROGRESS MADE DURING THE YEAR ARE
SET OUT ON PAGE 59
With regards to the Board, the Committee is cognisant of the diversity
targets set out in the updated Listing Rules which applied to the Group for
the first time in the financial year ending 31 October 2023. As referenced
above, we appointed an additional non-executive director, Alpna Amar,
during the year to further increase diversity on the Board. Andrew Davies,
the current Senior Independent Director, will step down from the Board on
completion of his third three-year term as a non-executive director in 2025,
and it has been agreed that Fiona MacAulay will succeed him as the Senior
Independent Director. The Group will then meet all of the diversity targets
inthe Listing Rules. The Committee will also have due regard for diversity
considerations when considering the appointment of my successor.
The charts below illustrate the gender identity or sex and ethnic background
of the Board and the Executive Committee as at 31 October 2023. Details
ofthe diversity of employees more widely across the Group are set out on
page 59.
GENDER IDENTITY OR SEX OF THE BOARD AND EXECUTIVE MANAGEMENT
Number of
Board members
Percentage of
the Board
Number of
senior positions
on the Board
(CEO, CFO,
SID and Chair)
Number on the
Executive Committee
Percentage of
Executive Committee
Men 5 56% 4 7 87%
Women 4 44% — 1 13%
Not specified/prefer not to say — — — — —
ETHNIC BACKGROUND OF THE BOARD AND EXECUTIVE MANAGEMENT
Board member
Number of
Board members
Percentage of
the Board
Number of
senior positions
on the Board
(CEO, CFO,
SID and Chair)
Number on the
Executive Committee
Percentage of
Executive Committee
White British or other white (includingminority-white groups) 8 89% 4 8 100%
Mixed multiple ethnic groups — — — — —
Asian/Asian British 1 11% — — —
Black/African/Caribbean/Black British — — — — —
Other ethnic group, including Arab — — — — —
SUCCESSION PLANNING
The Committee is responsible for promoting effective succession planning for
the Board and the Executive Committee, to ensure that the leadership of the
business remains aligned to the Group’s strategy.
During the year and in accordance with the normal practice, an assessment of
the succession plans for individuals in key leadership roles at the Group level
and within the businesses, developed utilising the Group’s established succession
planning framework, was considered by the Committee. The need for more
diversity within the talent pipeline continues to be recognised by the Committee
and this is now a key focus of our people and DE&I strategy. Further details
on the actions we are taking to address this are set out on page 59.
The Committee is satisfied that appropriate succession plans are in place for
the Board and key members of the Executive Committee covering emergency
replacements. Longer-term appointments will be considered on a case-by-case
basis, including internal candidates where available or external recruitment
where deemed more appropriate. As referred to above, the Committee has
commenced a search for my replacement.
> FURTHER DETAILS ON OUR APPROACH TO SUCCESSION PLANNING
AND TALENT MANAGEMENT ARE SET OUT ON PAGES 57 TO 58
Carl-Peter Forster
Chairman of the Nomination Committee
12 December 2023
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 99

DIRECTORS’ REMUNERATION REPORT
REMUNERATION OVERVIEW
Laurie Bowen
Chair of the Remuneration Committee
REMUNERATION COMMITTEE MEMBERS
Laurie Bowen (Chairman)
Andrew Davies
Carl-Peter Forster
Stephen King
Fiona MacAulay
INTRODUCTION
The directors’ remuneration report for the year ended 31 October 2023 comprises:
- my annual report on the activities of the Remuneration Committee during
the year;
- the annual report on remuneration, which explains how the current
directors’ remuneration policy was implemented in 2023;
- additional statutory information on remuneration arrangements;
- a summary of the directors’ remuneration policy which was approved in
March 2022; and
- an overview of how the policy will be implemented in 2024.
THE REMUNERATION COMMITTEE’S ACTIVITIES DURING
THEYEAR
The table below summarises the Committee’s key activities and decisions
made during the year.
SUMMARY OF MAJOR ACTIVITIES
AND DECISIONS OF THE COMMITTEE IN 2023
SALARY
- 2023 salary reviews for the executive directors
andmembers of the senior leadership team
ANNUAL
BONUS
- Approval of the 2023 annual bonus plan financialtargets
and strategic objectives for theexecutive directors
- Consideration of the 2023 annual bonus plan payments
PERFORMANCE
SHARE PLAN
(“PSP”)
- Consideration of vesting outcomes for PSP awardsmade
in 2020
- Approval of 2023 PSP awards and
performanceconditions
APPOINTMENTS
AND LEAVER
ARRANGEMENTS
- Approval of the remuneration arrangements forthe new
Chief Financial Officer
- Approval of the termination arrangements for theretiring
Chief Financial Officer
PERFORMANCE FOR 2023 AND REMUNERATION OUTCOMES
In 2023 we delivered both strong financial performance and also significant
contract wins across both our Sensors & Information and Countermeasures
& Energetics sectors. This was in response to resurgent demand for traditional
defence capabilities which the Group was able to respond to with its well
positioned portfolio of technology-driven solutions. We increased revenue by
18% on 2022, with both underlying operating profit and EPS growing by 16%
and 8% respectively (based on continuing operations). This was despite external
market challenges that included relatively high inflation, higher interest rates,
supply chain constraints and timing issues in relation to US Department of
Defense approvals for some of our countermeasure deliveries which were
largely resolved by year end. Overall, the Group delivered a robust performance,
exceeding the expectations set at the start of the financial year and progressing
against our strategic goal of balancing short-term performance with longer-term
value creation.
Further progress has also been made in 2023 in relation to our sustainability
agenda, with the continued successful implementation of our HSE strategy,
improvement in our climate and carbon-related disclosures, and continued
focus on DE&I.
It is in this context that the Remuneration Committee has reviewed the
2023outturns.
Performance against the 2023 annual bonus and PSP targets is explained in
more detail on pages 104 and 107 but in summary:
- Annual bonus: The annual bonus for 2023 was subject to EPS, operating
cashflow and strategic objective measures. As a result of the continuing
strong financial performance of the Group during 2023, which resulted in
thestretch EPS growth and the on-target operating cash flow being exceeded,
100% of the EPS metric and 97.1% of the operating cash flow metric will
pay out. The Committee carefully assessed the performance of the executive
directors against the common set of safety, people, governance, growth and
strategic targets set at the beginning of the financial year and, as a result of
performance against the targets set, with all targets either being achieved
orexceeded, determined that 75% of the maximum was payable.
The total bonus payments for 2023 are therefore 93.84% of maximum for
each of the executive directors.
- PSP awards made on 16 December 2020 (subject to performance over the
threeyears ended 31 October 2023): The PSP awards granted to the executive
directors on 16 December 2020 were subject 50% to EPS targetsand 50%
to relative TSR targets. Based on strong EPS growth of circa 10.6% p.a. over
the three-year performance period, which exceeded the maximum target
of 10% p.a., and TSR performance over the same period, placing Chemring
above the median versus the comparator group (ranking circa 157th out of
the entire FTSE All-Share companies excluding investment trusts), these awards
will vest at 71.85% of the maximum.
MEMBERSHIP AND OPERATION OF THE
REMUNERATIONCOMMITTEE
The Remuneration Committee has been established by the Board and is
responsible for the remuneration of the executive directors, the Chairman
and the leadership team at the next level. All members of the Committee
are independent non-executive directors, save for Mr Forster who was
independent on appointment to the Board.
The Committee’s responsibilities are set out in its terms of reference,
which are available on the Company’s website.
Details of the attendance of members of the Committee at meetings held
during the year are shown on page 91. The Group Legal Director &
Company Secretary acts as secretary to the Committee and the Group
Chief Executive attends meetings by invitation, but no executive director
or other employee is present during discussions relating directly to their
own remuneration.
Chemring Group PLC Annual report and accounts 2023100

The Committee is satisfied the remuneration policy has operated as intended
in relation to performance and remuneration outcomes for 2023, and did not
use any discretion. The Committee considered the impact of the share buyback
programme announced in August 2023 and concluded that this did not impact
the extent of achievement against the targets detailed above. With regards to
the December 2020 PSP awards vesting, the Committee also considered whether
there was the potential for windfall gains on vesting. In considering this, the
Committee noted that the awards had been granted in December 2020, at
ashare price well above the share price immediately prior to the Covid-19
pandemic. The Committee considered the share price performance over the
full performance period had been underpinned by robust financial performance
and noted the absolute total shareholder return created over the three-year
period to 31 October 2023 of 20.3% which was further considered reflective
of the robust financial performance delivered. As a result, the Committee
determined that there are no windfall gains and that the level ofpayout was
appropriate and reflective of Chemring’s strong performance. In addition, in
concluding that remuneration payments overall and the policy have operated
appropriately, the Committee considered the bonuses payable across the
Group, individual businesses’ performance and the relativities between employees
and executive directors in light of their roles and potential impact on the
Group performance (this included considering pay ratios) and the wider
stakeholder experience.
BOARD CHANGES
As announced on 23 January 2023, Andrew Lewis will be retiring from his
role as Chief Financial Officer on 31 December 2023 and will step down
from the Board on this date. Andrew will remain with the business until 19
January 2024 to ensure a smooth handover to his successor and will continue
to receive his salary, pension and benefits during this time. Andrew will not
receive any bonus nor any PSP award for 2024. The Committee determined
that Andrew will be treated as a good leaver for his outstanding incentive
awards, further details of which are set out in the payments for loss of office
section. The post-cessation shareholding requirement, which requires Andrew
to hold shares to the value of 200% of salary for two years post-cessation of
employment, will apply from 19 January 2024.
We were pleased to announce the appointment of James Mortensen as our
new Chief Financial Officer. James joined the Board on 1 November 2023
asChief Financial officer (Designate) to help ensure a smooth handover with
Andrew Lewis, and will be appointed Chief Financial Officer on 1 January 2024.
James will receive a salary of £370,000, pension of 7.5% of salary and benefits
inline with policy. James’ annual bonus opportunity for 2024 will be 125%
ofsalary and his PSP opportunity will be 150% of salary, in line with policy.
Hissalary was set having had regard to current market rates of pay and the
factthat this is his first permanent executive director position.
As part of the recruitment of James Mortensen, it was necessary to agree
compensation for remuneration forfeited from his previous employer. The
buy-out of the awards forfeited was structured on broadly similar terms
(i.e.equivalent value, subject to performance and similar vesting periods).
Fulldetails of the buy-out awards are included on page 109.
IMPLEMENTATION OF THE POLICY FOR 2024
Base salaries were reviewed in November 2023 and increases will be made
effective from 1 January 2024.
The Group Chief Executive and the Group Legal Director & Company
Secretary will both receive a cost-of-living-related salary increase of 4% of
salary effective 1 January 2024. The rate of increase was below the range of
budgeted increases of 5% to 7% that were set by, and then agreed with, each
individual operating business for 2024. Given the current Chief Financial Officer is
retiring, he will not receive a salary increase for 2024. James Mortensen will first
be eligible for a salary increase with effect from 1 January 2025.
Pension contributions for the executive directors will continue to be 7.5% of
salary, aligned with the majority practice across the UK workforce.
The annual bonus opportunity will continue to be 150% of salary for the
Group Chief Executive, and 125% of salary for the Chief Financial Officer and
the Group Legal Director & Company Secretary. Performance measures are
unchanged for 2024, with 40% subject to EPS, 40% operating cash flow and
20% common strategic objectives. The range of financial targets has been set
to be challenging in light of market conditions in the defence sector but also
having had regard to near-term challenges such as higher interest rates and
UK corporation tax rates.
PSP awards will be granted in 2024 over 150% of salary for the Group Chief
Executive, the Group Legal Director & Company Secretary and James Mortensen,
as the new Chief Financial Officer. Andrew Lewis will not receive a PSP award
for 2024. Performance will be subject 50% to EPS, 30% to relative TSR and
20% to ESG metrics related to scope 1 and scope 2 emissions. The range of
financial targets and carbon reduction targets has been set to be similarly
challenging to the targets set in prior years, having had regard to internal
plans, external market expectations for the Group’s performance and
forecast economic conditions over the three-year performance period.
With regard to non-executive director fees, the Board Chair fee and the
widernon-executive director base fee will be increased with effect from
1January 2024 at 4%, below the typical 5% to 7% increases being awarded
across the Group.
EMPLOYEE PAY AND STAKEHOLDER ENGAGEMENT
With exceptionally high levels of inflation, especially in the UK and the US,
wecontinued to take a range of actions to support our employees in 2023.
Given the nature of our operating model, which necessitates a level of independence
within our US operations, our salary management responses varied by location
based on our understanding of local needs.
Outside of pay, as the designated non-executive director, I visited employees
in locations in the UK and Norway to understand their perception of working
for Chemring and take their feedback for the Board. During these meetings,
which included front line employees, supervisors, and middle and senior
management, the topics covered included Chemring’s approach to governance,
including the workings of the Remuneration Committee, and how remuneration
links to strategy through the business. Participants in these discussions had
theopportunity to feed back on remuneration as well as wider employment
considerations and all feedback received was presented to the appropriate
divisional leadership, the relevant Board committees and the full Board.
Myrole supplements the wider employee engagement process at Chemring,
which includes regular all-hands meetings and team briefings and our on-line
“Employee Voice” engagement tool. The above processes ensure that we
understand the employee perspective and can take appropriate action as
wedid during 2023.
With regards to engagement with shareholders, the Committee did not
identify any areas which necessitated consultation with our shareholders
during the year. The Committee continues to welcome shareholder feedback
and will proactively engage in relation to any major changes to the application
of our remuneration policy.
CONCLUSION
I hope you will find this report helpful and informative, and that you will
support the resolution on the directors’ remuneration report at our forthcoming
Annual General Meeting. Please do not hesitate to contact me on executive
directors’ remuneration matters via Sarah Ellard, Group Legal Director &
Company Secretary, at sarahe@chemring.co.uk.
Laurie Bowen
Chair of the Remuneration Committee
12 December 2023
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 101

DIRECTORS’ REMUNERATION REPORT continued
2023 REMUNERATION AT A GLANCE
2023 REMUNERATION YEAR IN SUMMARY
SALARY Salary increases effective 1 January 2023 were as follows:
- Michael Ord - 6.73% increase to £555,000
- Andrew Lewis - 5% increase to £399,376
- Sarah Ellard - 5% increase to £279,978
ANNUAL BONUS Bonuses payable for 2023 performance were as follows:
- Michael Ord - 140.76% of salary (£781,218)
- Andrew Lewis - 117.3% of salary (£468,468)
- Sarah Ellard - 117.3% of salary (£328,414)
PERFORMANCE
SHARE PLAN
AWARDS GRANTED
Awards made in December 2022, valued at 150% of salary, with EPS, TSR and ESG-related performance conditions measured
overathree-year period, and a two-year holding period post-vesting.
AWARDS VESTING
Awards made in December 2020 to all three executive directors, which were subject to EPS and TSR performance conditions
measured over the three years ended 31 October 2023, will vest at 71.85% of the maximum.
SHAREHOLDING Shareholding guideline of 200% of base salary (both in and post-employment, with the post-employment guideline based on the
lowerof the guideline and shares held on cessation of employment, which are held for two years).
CHAIRMAN
ANDNON-
EXECUTIVE
DIRECTOR FEES
Base fees for the Chairman and non-executive directors increased by 5% effective 1 January 2023.
Chemring Group PLC Annual report and accounts 2023102

Michael Ord
Andrew Lewis
Sarah Ellard
£0.0m £0.50m £1.0m £1.5m £2.0m £2.5m
Total pay
£1,866k
£1,293k
£917k
Salary Pension and benefits Annual bonus PSP
Michael Ord
Andrew Lewis
Sarah Ellard
£0.0m £0.1m £0.2m £0.3m £0.4m £0.5m £0.6m £0.8m£0.7m
Total bonus
£781k
£468k
£328k
Target (% of salary) Actual (% of salary) Maximum (% of salary)
125.00%
125.00%
150.00%
140.76%90.00%
117.30%75.00%
75.00% 117.30%
Grant £661k
Grant £528k
Grant £377k
Michael Ord
Andrew Lewis
Sarah Ellard
£0.0m £0.1m £0.2m £0.3m £0.4m £0.5m £0.6m £0.7m £0.8m £0.9m £1.0m
Estimated vesting value £474k
Estimated vesting value £378k
Estimated vesting value £270k
Value of shares vesting Accrued dividends
EXECUTIVE DIRECTORS’ TOTAL PAY
This chart illustrates the total remuneration received by the executive directors in 2023.
ANNUAL BONUS PLAN OUTCOME
This chart illustrates the bonuses payable for performance in 2023. 60% of the bonus amount is payable in cash and 40% will be satisfied by way of an award of
shares deferred for three years.
PERFORMANCE SHARE PLAN OUTCOME
This chart illustrates the total value of each of the performance share plan awards granted to all three executive directors on 16 December 2020, which will vest
at 71.85% of the maximum. The grant value is based on the share price on the grant date and the vesting value is calculated on the same basis as in the directors’
emoluments table on page 104.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 103

DIRECTORS’ REMUNERATION REPORT continued
ANNUAL REPORT ONREMUNERATION
This part of the report explains how the directors’ remuneration policy was implemented in 2023. The auditor has reported on certain sections of this report and stated
whether, in its opinion, those sections have been properly prepared in accordance with the Companies Act 2006. Those sections subject to audit are clearly indicated.
DIRECTORS’ EMOLUMENTS (AUDITED)
The emoluments of all the directors who served during the year are shown below:
Year
Salaries/
fees
£’000
Taxable
benefits
1
£’000
Pension
benefits
2
£’000
Total
fixed pay
£’000
Bonus
(cash and
deferred
shares)
3
£’000
PSP
4
£’000
Total
variable pay
£’000
Total
£’000
Executives
Michael Ord 2023 549 21 41 611 781 474 1,255 1,866
2022 514 21 51 586 764 963 1,727 2,313
Andrew Lewis 2023 396 21 30 447 468 378 846 1,293
2022 379 20 76 475 466 768 1,234 1,709
Sarah Ellard 2023 278 20 21 319 328 270 598 917
2022 265 20 53 338 327 494 821 1,159
Non-executives
Carl-Peter Forster 2023 215 — — 215 — — — 215
2022 205 — — 205 — — — 205
Alpna Amar
5
2023 23 — — 23 — — — 23
2022 — — — — — — — —
Laurie Bowen
6
2023 74 — — 74 — — — 74
2022 71 — — 71 — — — 71
Andrew Davies
7
2023 69 — — 69 — — — 69
2022 66 — — 66 — — — 66
Stephen King
8
2023 69 — — 69 — — — 69
2022 66 — — 66 — — — 66
Fiona MacAulay 2023 59 — — 59 — — — 59
2022 56 — — 56 — — — 56
Total remuneration 2023 1,732 62 92 1,886 1,577 1,122 2,699 4,585
2022 1,622 61 180 1,863 1,557 2,225 3,782 5,645
NOTES:
1. Comprises an annual car allowance of £20,000 for Michael Ord and £19,350 for each of Andrew Lewis and Sarah Ellard, plus private medical insurance for each of the executive directors.
2. The executive directors received a cash supplement of 7.5% of salary in lieu of occupational pension scheme membership in 2023. In 2022, Michael Ord received a cash supplement
of 10% of salary and the other two executive directors received a cash supplement of 20% of salary.
3. 40% of any bonus is delivered as an award of deferred shares.
4. The PSP awards granted in December 2020 to all three executive directors were based 50% on EPS performance and 50% on TSR performance, both measured over the three
years ended 31 October 2023. These awards will vest at 71.85% of the maximum and their estimated values have been included in the 2023 emoluments based on the average
share price over the three-month period ended 31 October 2023, equating to 284p per share. The share price on the date of grant of the awards was 300p and therefore no
share price appreciation is reflected in the PSP values for 2023. The value of accrued dividends on each award has also been included in the 2023 emoluments. The 2022 PSP
values have been restated based on the share price on the date of vesting of 300.5p.
5. Alpna Amar was appointed as a non-executive director on 13 June 2023.
6. Laurie Bowen receives an additional fee of £10,000 per annum for her appointment as Chair of the Remuneration Committee and an additional fee of £5,000 per annum in
respect of her appointment as the non-executive director responsible for employee engagement.
7. Andrew Davies receives an additional fee of £10,000 per annum for his appointment as Senior Independent Director.
8. Stephen King receives an additional fee of £10,000 per annum for his appointment as Chairman of the Audit Committee.
Amounts shown above in the salaries and fees column relate to base salary in the case of executive directors and fees in the case of non-executive directors.
BASE SALARY AND BENEFITS PAID DURING THE YEAR (AUDITED)
Salaries for the executive directors were reviewed in November 2022 and increases were approved by the Remuneration Committee effective 1 January 2023.
The salaries of the executive directors during the year were therefore as follows:
Executive
Annual salary from
1 November 2022 to
31 October 2022
Annual salary from
1 January 2023 to
31 October 2023
Michael Ord £520,000 £555,000
Andrew Lewis £380,358 £399,376
Sarah Ellard £266,646 £279,978
Michael Ord receives a cash allowance of £20,000 per annum in lieu of a company car and the other executive directors receive a cash allowance of £19,350 per annum.
Chemring Group PLC Annual report and accounts 2023104

DETAILS OF VARIABLE PAY OPPORTUNITY IN THE YEAR
ANNUAL BONUS (AUDITED)
80% of the annual bonus opportunity for 2023 was based on financial targets (namely earnings per share and operating cash flow), with 20% based on strategic
objectives. No bonus is payable in respect of the strategic objectives unless the Committee is satisfied that this is justified by the Group’s underlying performance,
including inter alia levels of profitability and cash flow, as well as health and safety performance.
The Committee has consistently set challenging targets for the achievement of maximum bonuses. The financial targets for the 2023 bonus plan, compared with
actual performance (adjusted to reflect budgeted foreign exchange rates as per the plan rules), were as follows:
Weighting
(80% of overall bonus) Performance
Payout
(% of element) Target Actual
Payout achieved
(% of element)
Underlying diluted earnings per share
(continuing operations)
50% Threshold
Target
Stretch
0%
50%
100%
17.20p
18.10p
19.91p
20.5p 100%
Underlying operating cash flow
(continuing operations)
50% Threshold
Target
Stretch
0%
50%
100%
£74.67m
£78.60m
£82.53m
£82.3m 97.1%
The strategic objectives set in respect of the 2023 bonus plan were set on a consistent basis across the executive directors, members of the Executive
Committee and each of the business unit leaders, focused as appropriate on their respective businesses. Details of the key achievements of the executive
directors against the strategic objectives are set out below:
Strategic objective target Performance against targets
SAFETY
- Continued delivery of the Group’s HSE
ManagementSystem Framework Standard
andassociated assurance processes.
- Maintain the Group’s total recordable injury frequency
rate below 1.0.
- Maintain the Group’s process safety event (level 3 & 2)
rate below 2.0.
- Total recordable injury frequency rate of 0.90 (2022: 0.78) against a targeted limit of 1.0.
- Process safety event (level 3 & 2) rate of 2.87 (2022: 1.86) against a targeted limit of 2.0.
Achieved at 50% of maximum in light of the process safety event rate exceeding the
targeted limit.
STRATEGY AND CORPORATE DEVELOPMENT
- Deliver organic and inorganic growth plans for Roke.
- Progress Roke USA market and business development
campaign, focusing on customer penetration and sales.
- Progress biosecurity growth opportunities across US
Department of Defense and wider US markets.
- Develop organic and inorganic growth options for US
space and missiles markets.
- Develop growth options for Chemring Energetics
UKand Chemring Nobel to capture the upturn in
theEuropean and US propellant and speciality
materialsmarkets.
- Reassess future strategic opportunities for the
Countermeasures businesses.
- Delivered double digit order intake, revenue and profit growth at Roke and completed the
Geollect acquisition in December 2022.
- Roke brand recognition established in the US, particularly with the land electronic warfare
customer base, and validated the capability of the Perceive electronic warfare system against US
requirements, securing a small initial contract win on a US programme. However, the Roke USA
sales budget for the year was not achieved.
- EMBD FRP contract continued to deliver to plan and LRIP contract secured on the JBTDS
programme. Contract secured with the US Department of Homeland Security to deliver
prototype systems for assessment in non-military environments.
- Order intake at Chemring Energetic Devices exceeded US$154m, reflecting continued organic growth in
the US space and missiles markets. Three potential bolt-on acquisitions identified and under review.
- Order intake in the three Energetics businesses exceeded £358m.
- c.£120m of capital investment approved to support significant organic growth in the Energetics
businesses. Projects mobilised for a new propellant facility at Chemring Energetics UK and capacity
expansion at Chemring Nobel.
- Completed review of wider market opportunities for Chemring Australia and future business
strategy for Kilgore against site infrastructure plans.
Achieved at 60% of maximum in light of the Roke USA sales budget not being achieved and
ongoing development of the future strategy for the Countermeasures businesses.
ENVIRONMENTAL SUSTAINABILITY
- Develop infrastructure options for Ardeer and Salisbury
sites to facilitate reductions in energy consumption in
support of the Group’s commitment to be net zero
by2030.
- Reduce Group scope 1 and 2 market-based emissions
year-on-year bya minimum of 7.5%.
- Site infrastructure plans developed for the Ardeer and Salisbury sites, and the associated capital
investment requirements phased into the five-year plans for Chemring Energetics UK and
Chemring Countermeasures UK.
- Group Scope 1 and Scope 2 market-based emissions reduced by 9.1% (2022: 7.3%) and
independently verified by ERM. Progress delivered against: (i) electrification of the business;
(ii)energy efficiency improvements; and (iii) renewable energy sourcing.
Achieved in full.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 105

Strategic objective target Performance against targets
PEOPLE
- Ensure all employees have a voice in the business to
strengthen our values-based cultureby involvement
inregular employee sentiment assessment and
demonstrate management actions in response
toemployee feedback.
- Further improve business management
capabilitybydeployment of Leading Our People
andAspire@Chemring development programmes.
- Strengthen talent pipeline with more robust
successionplanning and implementation
ofassociateddevelopment plans.
- Further deploy DE&I education programme and
implement actions to support genderdiversity.
- All businesses are utilising the Employee Voice feedback system, which is supplemented with local
listening approaches at each business. All businesses have established feedback mechanisms; some
have centralised published action plans and others respond directly when specific feedback topics
are raised.
- All businesses participated in the Aspire@Chemring programme, with 75 employees having
graduated from the first cohort, and the Leading Our People development programme. Several
businesses have established additional operator and leadership competence programmes alongside
the Group-driven programmes to address specific business priorities.
- Talent assessments completed at the majority of the businesses during the year, which covered
more than 85 senior leadership and key roles across the Group. Succession planning process
identified over 100 individuals in the talent pipeline, 60 of whom will participate in the second cohort
of the Aspire@Chemring programme.
- All businesses are now reviewing and reporting on their diversity metrics on a monthly basis,
andutilising communication campaigns, training and Employee Voice to identify local priorities.
Percentage of females in senior leadership roles increased to 30%, against the target of at least
33% by2027.
Achieved in full.
GOVERNANCE
- Continue to strengthen the Group’s
governanceframework.
- Continue deployment of common standards and
practices to safeguard our people, information and
technology through the operation of a robust security
programme, with specific emphasis on cyber-security.
- Update and implement refreshed data retention
policiesand procedures.
- Updated Bribery Act Compliance Manual (“BACM 2022”) issued in November 2022, together
with an updated BACM Pocket Guide for all employees. Updated anti-bribery training deployed
through the Chemring Compliance Portal (“CCP”).
- Updated Operational Framework issued in January 2023.
- Two on-line training modules on the Code of Conduct issued through the CCP.
- Updated Chemring Cyber-Security Standard issued, including compliance options subject to
jurisdictional and customer requirements.
- Incident response retainers put in place with external consultants, and tabletop exercises held
toassess cyber incident scenarios and test and evolve our response in the event of an incident.
- Cyber-security training provided to employees, together with regular phishing exercises.
- Chemring Travel Standard updated to reflect additional requirements for travel to higher
riskdestinations.
- Updated data retention policy and procedures issued but full implementation, particularly in
relation to IT systems and electronic data, remains a work-in-progress.
Achieved at 65% of maximum in light of ongoing implementation of updated data
retention policy.
The Committee assesses performance against the targets using both qualitative and quantitative data. The above reflects a full summary of the targets set
andachievements delivered within the bounds of commercial confidentiality. Based on the overall performance against the five strategic targets detailed,
theCommittee determined that the targets had been met at 75% of the maximum.
Based on the above performance, bonuses are payable to the executive directors under the 2023 bonus plan as follows (audited):
Executive
Maximum bonus
(% of salary)
Bonus paid in
respect of
financial targets
(% of salary)
Bonus paid in
respect of
strategic
objectives
(% of salary)
Total bonus
payment (£)
1
Michael Ord 150% 118.26% 22.5% 781,218
Andrew Lewis 125% 98.55% 18.75% 468,468
Sarah Ellard 125% 98.55% 18.75% 328,414
NOTE:
1. 40% of bonuses payable are satisfied by way of an award of deferred shares, vesting of which is subject only to continued service over a period of three years.
The Committee reviewed the outcomes in light of broader company and individual performance and the stakeholder experience during the year and was
satisfied that no discretion was necessary.
DIRECTORS’ REMUNERATION REPORT continued
ANNUAL REPORT ONREMUNERATION continued
DETAILS OF VARIABLE PAY OPPORTUNITY IN THE YEAR continued
ANNUAL BONUS (AUDITED) continued
Chemring Group PLC Annual report and accounts 2023106

DEFERRED BONUS SHARES GRANTED DURING THE YEAR IN RESPECT OF THE 2022 BONUS
Details of the deferred bonus share awards granted on 13 December 2022 in relation to the bonus for the year ended 31 October 2022 are set out in the
tablebelow. The awards will normally vest subject to continued employment in three years.
Executive Date of grant Shares awarded Face value of award
1
Michael Ord 13 December 2022 100,249 £305,759
Andrew Lewis 13 December 2022 61,106 £186,373
Sarah Ellard 13 December 2022 42,838 £130,656
NOTE:
1. Value based on the closing share price of 305p on the date of grant.
PERFORMANCE SHARE PLAN (AUDITED)
Vesting of March 2020 PSP awards
The PSP awards granted to all three executive directors on 16 December 2020 were made subject to the following performance conditions:
Measure Threshold vesting Full vesting
Total compound EPS growth per annum over the three financial years ended 31 October 2023
(50% of award)
5% p.a.
(25% vests)
10% p.a.
(100% vests)
Rank of the Company’s TSR against the TSR of the members of the comparator group over
the three financial years ended 31 October 2023 (50% of award)
Median ranking
(25% vests)
Upper quartile ranking
(100% vests)
The Group’s compound EPS growth on continuing operations over the three financial years ended 31 October 2023 was 10.6% p.a. and 100% of the part of
theaward subject to the EPS measure will therefore vest on 16 December 2023. The Company’s TSR over the same performance period was 20.3% against
amedian TSR of 13.9% for the comparator group, ranking the Group at 157.2 out of 358, and therefore 43.7% of the TSR part of the award will also vest on
16December 2023.
Details of the awards granted to the executive directors on 16 December 2020 are provided below (audited):
Executive Vesting date
Number of shares
at grant
Number of
shares vested
Number of
shares lapsed
Michael Ord 16 December 2023 220,375 158,339 62,036
Andrew Lewis 16 December 2023 175,848 126,346 49,502
Sarah Ellard 16 December 2023 125,670 90,293 35,377
Executive
Value of shares
vested
Value of accrued
dividends
Total value of
awards vested
1
Michael Ord £449,683 £24,384 £474,067
Andrew Lewis £358,823 £19,457 £378,280
Sarah Ellard £256,432 £13,905 £270,337
NOTE:
1. Value estimated based on the average closing share price of 284p over the three-month period ended 31 October 2023.
PSP awards granted in the year
The following conditional awards of shares were granted to the executive directors under the PSP during the year:
Executive Date of grant Value of award
Closing share price
on date of grant
Number of
conditional shares
awarded Face value
%
that vests
at threshold
Vesting
determined by
Michael Ord 14 December 2022 150% of salary 307p 255,737 £785,113 25% 50% EPS growth,
30% relative TSR
performance and
20% ESG
performance, as
detailed below
Andrew Lewis 14 December 2022 150% of salary 307p 187,061 £574,277 25%
Sarah Ellard 14 December 2022 150% of salary 307p 131,137 £402,591 25%
The performance conditions applying to the awards made in December 2022 will be measured over three financial years commencing 1 November 2022 and
are weighted 50% EPS growth, 30% relative TSR performance and 20% ESG performance.
The EPS performance condition will be measured as follows:
Total compound EPS growth over the three-year performance period % of EPS part that may vest
Less than 5% p.a. 0%
5% p.a. 25%
Between 5% p.a. and 10% p.a. On a straight-line basis between 25% and 100%
10% p.a. or more 100%
NOTE:
1. Earnings per share is calculated on an underlying, fully diluted and normalised basis, as specified by the Committee prior to grant.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 107

DETAILS OF VARIABLE PAY OPPORTUNITY IN THE YEAR continued
PERFORMANCE SHARE PLAN (AUDITED) continued
PSP awards granted in the year continued
The TSR performance condition will be measured as follows:
Rank of the Company’s TSR against the TSR of the FTSE All-Share (excluding investment trusts) over the three-year performance period % of TSR part that may vest
Below median 0%
Median 25%
Between median and upper quartile On a straight-line basis between 25% and 100%
Upper quartile or above 100%
The ESG performance condition will be measured as follows:
Reduction in scope 1 and scope 2 emissions (market-based) over the three-year performance period % of ESG part that may vest
Less than 15% 0%
15% 25%
Between 15% and 25% On a straight-line basis between 25% and 100%
25% or more 100%
Any shares that vest in respect of the December 2022 awards will be subject to a two-year holding period (after allowing for the sale of sufficient shares to meet
the tax and national insurance liability arising on vesting).
PENSION (AUDITED)
The following table sets out the pension benefits earned by the executive directors during the year. Only Sarah Ellard previously accrued benefits during her
former membership of the Chemring Group Staff Pension Scheme.
Executive
Cash in lieu of
pension
contributions
£’000
Total benefit accrued at
31 October 2022
Transfer value
of accrued
benefit at
31 October
2022
£’000
Total benefit accrued at
31 October 2023
Transfer value
of accrued
benefit at
31 October
2023
£’000
Increase in
transfer value
during year
(less members’
contributions)
£’000
Value of
benefit
for single
figure
£’000
Pension
£’000 p.a.
Cash
£’000
Pension
£’000 p.a.
Cash
£’000
Michael Ord 41 — — — — — — — 41
Andrew Lewis 30 — — — — — — — 30
Sarah Ellard 21 24 72 461 24 72 461 — 21
NOTES:
1. Michael Ord received a 10% cash supplement in lieu of pension and the other executive directors received a 20% cash supplement during the 2022 financial year. With effect from
1 November 2022, the cash supplement paid to all of the executive directors was reduced to 7.5% to align with the workforce rate.
2. Transfer values represent liabilities of the applicable scheme, and do not represent sums paid to individuals.
3. Transfer values have been calculated in accordance with the Occupational Pension Scheme (Transfer Value) Regulations 1996.
4. Sarah Ellard left pensionable service on 6 April 2010 and therefore has not accrued additional pension over the year. The accrued benefits shown are the benefits at the date of exit.
5. The scheme provided pension at a rate of 1/80th of final pensionable salary plus a cash lump sum of 3/80ths for each year of membership. Final pensionable salary was capped at
the HMRC notional earnings cap, and the scheme assumed a normal retirement age of 65. Early retirement is permissible from age 55 but accrued benefits are reduced accordingly
using the early retirement factors in force at the date of early retirement.
PAYMENTS TO PAST DIRECTORS AND PAYMENTS FOR LOSS OF OFFICE
On 23 January 2023, we announced Andrew Lewis’ intention to retire from the role of Chief Financial Officer and as a director of the Company. Andrew will
step down as Chief Financial Officer and as a director of the Company on 31 December 2023 but will remain as an employee of the Company until 19 January
2024 to ensure a smooth handover to his successor.
In respect of Andrew’s remuneration for FY24 and treatment of his outstanding incentive awards, given the reason for his cessation of employment is retirement,
the Remuneration Committee has determined that Andrew will be treated as a “good leaver” and as such the following approach will be taken which is
consistent with the provisions included in the directors’ remuneration policy:
- Andrew will continue to receive his salary, pension and benefits until cessation of his employment on 19 January 2024;
- Andrew will not be entitled to receive any bonus for FY24;
- outstanding deferred bonus share awards (2021, 2022 and 2023 awards) will be retained and will vest in full, the 2021 and 2022 awards will vest
inJanuary2026 and the 2023 awards will vest on the normal vesting date in December 2026;
- outstanding PSP awards (2021 and 2022 awards) will be pro-rated based on the proportion of the vesting period for each award that has elapsed
to19January2024. The PSP awards will vest in January 2026, subject to the achievement of the applicable performance conditions and the two-year
post-vesting holding period for each award will continue to apply; and
- the post-cessation shareholding requirement will apply from 19 January 2024.
No payments were made to past directors during the year.
DIRECTORS’ REMUNERATION REPORT continued
ANNUAL REPORT ONREMUNERATION continued
Chemring Group PLC Annual report and accounts 2023108

BUY-OUT ARRANGEMENTS FOR JAMES MORTENSEN
On 24 May 2023, we announced the appointment of James Mortensen asour
new Chief Financial Officer. As part of his recruitment, the Committee agreed
to provide compensation for the remuneration he forfeited as a result of him
taking up the appointment with the Group. The structure of his buy-out
awards mirrors the terms and quantum, as far as is practicable, of what was
forfeited and all payments are subject to relevant performance assessments.
Details of the compensatory arrangements are set out below:
- FY23 annual bonus: A payment of £156,987 was made to James following
commencement of employment in respect of the annual bonus he forfeited
with Smiths Group plc (“Smiths”). The payment is subject to clawback in the
event of James ceasing employment within two years of payment. The value
and the structure of the payment mirrors what was forfeited.
- FY20 long-term incentive plan (awarded in October 2020): 55,956 Chemring
shares will be awarded in lieu of the number of shares forfeited by James as
a result of his resignation from Smiths. The number of shares was determined
based on converting the number of Smiths shares which would have been
awarded into Chemring shares, using the relative share prices on the day
prior to James commencing employment. The number of shares which will
be awarded was also reduced to reflect the extent to which the applicable
Smiths performance condition was met over the three-year period ending
31 July 2023, which was at 75.6% of maximum. The net number of shares
from this award will be retained towards satisfying the Company’s 200% of
salary share ownership guidelines and the value of the award will be repayable
to the Company in the event of James ceasing employment within two years.
- FY21 long-term incentive plan (awarded in October 2021): An award will
bemade over 79,665 Chemring shares in lieu of the award forfeited. The
number of shares was determined based on converting the number of
Smiths shares in the original award into Chemring shares using the relative
share prices on the day prior to James commencing employment. These
shares will vest subject to the extent that Chemring’s December 2021
PSPawards' performance conditions are met, based on performance to
31October 2024. Any shares vesting under this award will be subject to a
two-year holding period post-vesting. Having considered the terms of the
Smiths award, the Committee was comfortable that the replacement
awardwas of a broadly equivalent value to the award forfeited and
achievedalignment with the wider executive team at Chemring.
- FY22 long-term incentive plan (awarded in October 2022): An award will
bemade over 79,665 Chemring shares in lieu of the award forfeited. The
number of shares was determined based on converting the number of
Smiths shares in the original award into Chemring shares using the relative
share prices on the day prior to James commencing employment. These
shares will vest subject to the extent that Chemring’s December 2022 PSP
awards' performance conditions are met, based on performance to
31October 2025. Any shares vesting under this award will be subject to a
two-year holding period post-vesting. Having considered the terms of the
Smiths award, the Committee was comfortable that the replacement award
was of a broadly equivalent value to the award forfeited and achieved
alignment with the wider executive team at Chemring.
Further details of the above awards will be set out in next year’s directors’
remuneration report following the grant of the replacement awards.
REMUNERATION IN THE WIDER WORKFORCE
In addition to determining the remuneration arrangements for the executive
directors, the Committee considers and approves the base salaries for eight
senior executives, excluding those based in the US. The Committee also
receives information on general pay levels and policies across the Group.
TheCommittee, therefore, has due regard to salary levels across the Group
in applying its remuneration policy.
The Group comprises a number of businesses, some of which have been
developed through organic growth, others of which have been acquired over
time. As aresult there are diverse remuneration arrangements in place across
the Group. An example of this is pension provision, where contributions
range from 6% to 20% of salary depending on location and length of service.
Where possible the business aims to consolidate and normalise its remuneration
approach, particularly in relation to fixed pay arrangements, taking into
account regional and sector-related variations.
In the US, the US Board has established a Compensation Committee to
setthe remuneration arrangements for the senior leadership of the US
businesses, inaccordance with the requirements of our Special Security
Agreement with the US Government. The US Compensation Committee
consults with the Remuneration Committee where appropriate.
The annual bonus plan for the senior leadership is typically operated for
around 80 employees and works in a similar fashion to that for the executive
directors, albeit with greater focus on business unit performance where
appropriate. Therefore, overall bonus outcomes maintain a level of consistency
with Group level performance but allow for differentiated outcomes based
on business unit and individual performance.
Below Board, the performance share plan is also operated, in order to allow
us to recruit and retain the best talent. Employees who are considered to
have a direct influence on Group level performance participate in this plan
and in 2023 this included 50 employees.
All UK employees are encouraged to participate in the UK Sharesave Plan.
Atpresent over 450 employees participate in the UK Sharesave Plan.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 109

DIRECTORS’ SHAREHOLDINGS (AUDITED)
Shareholding guidelines apply to executive directors during employment and post-cessation of employment. Executive directors are expected to build up
andmaintain a shareholding in the Company equivalent to 200% of base salary, by retaining at least 50% of after-tax vested PSP awards until such time as the
guidelines have been met. The executive directors are also required to hold shares to the value of the shareholding guideline (i.e. 200% of base salary or their
existing shareholding if lower at the time) for two years post-cessation of employment. The shareholding will be assessed at the time of stepping down from
theBoard.
The interests of the directors in the ordinary shares of the Company at 31 October 2023 are shown below. All are beneficial holdings.
Executive
Legally
owned
(number
of shares)
Value of
legally
owned
shares as %
of salary
1
Guideline
met
Unvested and subject to performance
conditions under the PSP
Deferred bonus
share
awards
Sharesave
options
Dec 2020
award
Dec 2021
award
Dec 2022
award
Total at
31 October
2023
Michael Ord 576,906 291% Yes 220,375 255,555 255,737 731,667 255,719 7,894
Andrew Lewis 315,717 221% Yes 175,848 195,386 187,061 558,295 158,120 —
Sarah Ellard 246,243 246% Ye s 125,670 136,973 131,137 393,780 108,190 7,894
Carl-Peter Forster 30,000 — — — — — — — —
Alpna Amar — — — — — — — — —
Laurie Bowen 15,000 — — — — — — — —
Andrew Davies — — — — — — — — —
Stephen King 130,500 — — — — — — — —
Fiona MacAulay — — — — — — — — —
NOTE:
1. Based on the number of shares legally owned, prevailing base salary and share price of 279.5p at 31 October 2023.
The directors’ share interests at 31 October 2023 include shares held by the directors’ connected persons, if any, as required by the Regulations. There have
been no changes to the directors’ interests in shares since 31 October 2023.
OUTSTANDING PSP AWARDS (AUDITED)
Executive
At
1 November
2022
Number of shares under award
Date of
vesting
Closing
share price on
date of grant (p)
Awarded
during
the year
Lapsed
during
the year
Vested
during
the year
At
31 October
2023
Michael Ord
307,142 — — (307,142) — 17 December 2022 225.5
220,375 — — — 220,375
1
16 December 2023 300.0
255,555 — — — 255,555 15 December 2024 286.5
— 255,737 — — 255,737 14 December 2025 307.0
783,072 255,737 — (307,142) 731,667
Andrew Lewis
245,085 — — (245,085) — 17 December 2022 225.5
175,848 — — — 175,848
1
16 December 2023 300.0
195,386 — — — 195,386 15 December 2024 286.5
— 187,061 — — 187,061 14 December 2025 307.0
616,319 187,061 — (245,085) 558,295
Sarah Ellard
157,635 — — (157,635) — 17 December 2022 225.5
125,670 — — — 125,670
1
16 December 2023 300.0
136,973 — — — 136,973 15 December 2024 286.5
— 131,137 — — 131,137 14 December 2025 307.0
420,278 131,137 — (157,635) 393,780
NOTE:
1. As explained above, these awards will vest at 71.85% of the maximum on 16 December 2023.
DIRECTORS’ REMUNERATION REPORT continued
ADDITIONAL STATUTORY INFORMATION
ONREMUNERATION ARRANGEMENTS
Chemring Group PLC Annual report and accounts 2023110

PERFORMANCE CONDITIONS FOR OUTSTANDING PSP AWARDS
Measure Director
Executive directors’
award values
Threshold
vesting
Full
vesting
Awards made on
16December 2020
Total compound EPS growth per annum over the
threefinancial years ended 31 October 2023
(50% of award)
Michael Ord
Andrew Lewis
Sarah Ellard
150% of salary
5% p.a.
(25% vests)
10% p.a.
(100% vests)
Rank of the Company’s TSR against the TSR of the
FTSE All-Share (excluding investment trusts) over
thexthree financial years ended 31 October 2023
(50% of award)
Median ranking
(25% vests)
Upper quartile
ranking
(100% vests)
Awards made on
15December 2021
Total compound EPS growth per annum over the
threefinancial years ended 31 October 2024
(50% of award)
Michael Ord
Andrew Lewis
Sarah Ellard
150% of salary
5% p.a.
(25% vests)
10% p.a.
(100% vests)
Rank of the Company’s TSR against the TSR of the
FTSE All-Share (excluding investment trusts) over
thethree financial years ended 31 October 2024
(30% of award)
Median ranking
(25% vests)
Upper quartile
ranking
(100% vests)
Reduction in scope 1 and scope 2 emissions
(market-based) over the three financial years
ended31October 2024 (20% of award)
15%
(25% vests)
25%
(100% vests)
Awards made on
14December 2022
Total compound EPS growth per annum over the
threefinancial years ended 31 October 2025
(50% of award)
Michael Ord
Andrew Lewis
Sarah Ellard
150% of salary
5% p.a.
(25% vests)
10% p.a.
(100% vests)
Rank of the Company’s TSR against the TSR of the
FTSE All-Share (excluding investment trusts) over the
three financial years ended 31 October 2025
(30% of award)
Median ranking
(25% vests)
Upper quartile
ranking
(100% vests)
Reduction in scope 1 and scope 2 emissions
(market-based) over the three financial years
ended31October 2025 (20% of award)
15%
(25% vests)
25%
(100% vesting)
OUTSTANDING DEFERRED BONUS SHARE AWARDS (AUDITED)
Executive
Number of shares under award
Date of
vesting
Closing
share price on
date of grant (p)
At 1 November
2022
Awarded during
the year
Lapsed during
the year
Vested during
the year
At 31 October
2023
Michael Ord
100,333 — — (100,333) — 16 December 2022 210.0
71,989 — — — 71,989 15 December 2023 300.0
83,481 — — — 83,481 14 December 2024 283.5
— 100,249 — — 100,249 13 December 2025 305.0
255,803 100,249 — (100,333) 255,719
Andrew Lewis
64,048 — — (64,048) — 16 December 2022 210.0
45,954 — — — 45,954 15 December 2023 300.0
51,060 — — — 51,060 14 December 2024 283.5
— 61,106 — — 61,106 13 December 2025 305.0
161,062 61,106 — (64,048) 158,120
Sarah Ellard
41,195 — — (41,195) — 16 December 2022 210.0
29,557 — — — 29,557 15 December 2023 300.0
35,795 — — — 35,795 14 December 2024 283.5
— 42,838 — — 42,838 13 December 2025 305.0
106,547 42,838 — (41,195) 108,190
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 111

OUTSTANDING SHARESAVE OPTIONS (AUDITED)
Executive
At 1 November
2022
Number of shares under award
Exercise
price
Exercise
date
Awarded
during
the year
Lapsed
during
the year
Vested
during
the year
At 31 October
2023
Michael Ord
16,853 — — (16,853) — 178p 1 October 2023 –
31 March 2024
— 7,894 — — 7,894 228p 1 October 2026 –
31 March 2027
16,853 7,894 — (16,853) 7,894
Andrew Lewis
8,910 — — (8,910) — 202p 1 October 2023 –
31 March 2024
8,910 — — (8,910) —
Sarah Ellard
8,910 — — (8,910) — 202p 1 October 2023 –
31 March 2024
— 7,894 — — 7,894 228p 1 October 2026 –
31 March 2027
8,910 7,894 — (8,910) 7,894
TOTAL SHAREHOLDER RETURN PERFORMANCE GRAPH
The following graph shows the Company’s cumulative TSR over the last ten financial years relative to the FTSE 250 and FTSE SmallCap Indexes. The FTSE 250
has been selected by the Committee for this comparison because it provides the most appropriate measure of performance of listed companies of a similar size
to the Company. The FTSE SmallCap has been shown in previous years and has been included this year for the purpose of continuity.
The graph shows the value, by 31 October 2023, of £100 invested in Chemring Group PLC on 31 October 2013 compared with the value of £100 invested in
the FTSE 250 and FTSE SmallCap. The other points are the values at intervening financial year ends.
Chemring
F
TSE 250
F
TSE SmallCap
£350
£300
£250
£200
£150
£100
£50
£0
31 Oct 12 31 Oct 13 31 Oct 14 31 Oct 15 31 Oct 16 31 Oct 17 31 Oct 18 31 Oct 19 31 Oct 20 31 Oct 21 31 Oct 22
Source: Datastream (Thomson Reuters)
CHIEF EXECUTIVE’S REMUNERATION TABLE
The total remuneration figures for the Group Chief Executive during each of the last ten financial years are shown in the table below. Michael Flowers replaced
Mark Papworth as Group Chief Executive on 24 June 2014 and Michael Ord replaced Michael Flowers on 1 July 2018.
The total remuneration figure for 2014 includes the payments for loss of office made to Mark Papworth. The figure for 2018 includes a full year’s salary and
benefits for Michael Flowers.
The total remuneration figure for each year includes the annual bonus based on that year’s performance and, where applicable, vested PSP awards based on the
three-year performance period ending in the relevant year. The annual bonus payout and PSP award vesting level as a percentage of the maximum opportunity
are also shown for each of these years.
Mark
Papworth/
Michael
Flowers Michael Flowers
Michael
Flowers/
Michael Ord Michael Ord
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Total remuneration (£’000) 841 507 855 831 969 1,021 1,045 3,583 2,313 1,866
Annual bonus
(% of maximum) 50% 0% 68.3% 59.5% 0% 98% 98% 98% 98% 93.84%
PSP awards vesting
(% of maximum) 0% 0% 0% 0% 35% 0% 0%
86.4%/
100% 100% 71.85%
DIRECTORS’ REMUNERATION REPORT continued
ADDITIONAL STATUTORY INFORMATION
ONREMUNERATION ARRANGEMENTS continued
Chemring Group PLC Annual report and accounts 2023112

PERCENTAGE CHANGE IN THE DIRECTORS’ REMUNERATION
The table below shows the annual percentage change in the total remuneration (excluding the value of any PSP awards and pension benefits receivable in the year)
foreach of the directors between the 2019 and 2023 financial years, compared to that of the average for all eligible employees of the Group.
2019 vs 2020 2020 vs 2021 2021 vs 2022 2022 vs 2023
Salary Benefits
Annual
bonus Salary Benefits
Annual
bonus Salary Benefits
Annual
bonus Salary Benefits
Annual
bonus
Group Chief Executive 2.3% 0% 2.5% 8.2% 0% 9.6% 8.0% 0% 29.1% 6.8% 0% 2.2%
Chief Financial Officer 2.6% 0% 2.7% 4.6% 0% 4.9% 3.6% 0% 28.7% 4.5% 5% 0.4%
Group Legal Director &
CompanySecretary 2.3% 0% 2.8% 14.7%
1
0% 14.4% 2.7% 0% 28.7% 4.9% 0% 0.3%
Carl-Peter Forster 0% N/A N/A 0% N/A N/A 1.0% N/A N/A 4.9% N/A N/A
Alpna Amar
2
N/A N/A N/A N/A
2
N/A N/A 1.0% N/A N/A N/A N/A N/A
Laurie Bowen N/A N/A N/A 11.3%
3
N/A N/A 2.9% N/A N/A 4.2% N/A N/A
Andrew Davies (12.6%) N/A N/A 8.6%
4
N/A N/A 4.8% N/A N/A 4.5% N/A N/A
Stephen King 0% N/A N/A 0% N/A N/A 1.5% N/A N/A 4.5% N/A N/A
Fiona MacAulay N/A N/A N/A N/A
5
N/A N/A 1.8% N/A N/A 5.4% N/A N/A
Average of other employees 4.0% 0% 3.0% 5.2% 5.2% 34.8% 3.2% (18.0%) 5.0% 3.9% (0.7%) (6.9%)
NOTES:
1. The Group Legal Director & Company Secretary’s salary was increased pro-rata to reflect her resumption of full-time working hours with effect from 1 November 2020.
2. Alpna Amar was appointed as a non-executive director on 13 June 2023.
3. The percentage increase in the fees paid to Laurie Bowen between 2020 and 2021 reflects the additional fees paid to her following her appointment as Chair of the Remuneration
Committee on 4 March 2020 and the fee paid to her as the non-executive director with responsibility for employee engagement from 1 January 2021.
4. The percentage increase in the fees paid to Andrew Davies between 2020 and 2021 reflects the additional fees paid to him as Senior Independent Director from 1 January 2021.
5. Fiona MacAulay was appointed as a non-executive director on 3 June 2020. Non-executive directors’ fees did not increase between 2020 and 2021.
CHIEF EXECUTIVE’S PAY RATIO
The table below shows how the Group Chief Executive’s single remuneration figure from the 2023 financial year compares to equivalent single figure
remuneration for full-time equivalent UK employees ranked at the 25
th
, 50
th
and 75
th
percentile.
The Committee considered the calculation approaches as set out in the Regulations and elected to use Method A, as it is considered to be the most appropriate
and robust way to calculate the ratio. The calculation was based on:
- actual base salary, benefits, bonus and long-term incentive awards for the year ended 31 October 2023 for UK employees as at 31 October 2023, with salaries
for part-time employees annualised on a full-time equivalent basis to allow equal comparisons; and
- employer pension contributions.
No components of pay and benefits were omitted for the purpose of the calculations; however, joiners and leavers during the year were excluded from the calculations.
Total remuneration
Year Methodology
25
th
percentile
(lower quartile)
pay ratio
50
th
percentile
(median)
pay ratio
75
th
percentile
(upper quartile)
pay ratio
2023 Method A 57.1 37.2 23.7
2022 Method A 68.3 46.8 29.7
2021 Method A 116.3 76.1 49.2
2020 Method A 39.9 25.0 15.8
Salary Total remuneration
Year 25
th
percentile 50
th
percentile 75
th
percentile 25
th
percentile 50
th
percentile 75
th
percentile
2023 £30,420 £45,100 £72,200 £32,666 £50,160 £78,732
The Committee is mindful that pay ratios, however calculated, are a useful reference point but cannot be considered in isolation. Any movement in ratios will
bereviewed by the Committee to understand the causes and longer-term trends will be monitored.
The pay ratios increased in 2021 as a result of, exceptionally, the inclusion of two PSP awards vesting in relation to the year. One of the PSP awards related to a
one-off award granted to the Group Chief Executive on appointment, which vested at 86.4% of maximum, and the second PSP award related to the normal PSP
grant, which vested at 100% of maximum. For 2022, there was only one PSP award included in the Group Chief Executive’s total single figure of remuneration,
which vested in full. Whilst the Group Chief Executive also received a salary increase for 2022 and an increase to his annual bonus entitlement, in 2022 the pay
ratio decreased primarily as a result of the total PSP value reducing during the year. The pay ratio has reduced further in 2023 as the Group Chief Executive's
PSP award did not vest in full and his overall remuneration in 2023 was lower than in 2022.
The reward policies and practices across the Group are considered by the Committee in the design process and implementation of the remuneration policy each
year for the executive directors. On this basis, the Committee is satisfied that the median pay ratio is consistent with the pay, reward and progression policies
against all employees.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 113

RELATIVE IMPORTANCE OF SPEND ON PAY
The following table shows the Company’s actual spend on pay (for all employees) relative to dividends and retained profits:
2023
£m
2022
£m % change
Staff costs 176.6 165.5 +7%
Dividends 17.3 14.4 +20%
Retained profits 62.9 87.2 -28%
The dividends figures relate to amounts payable in respect of the relevant financial year.
Retained profits reflect the underlying success of the Group and the profit generated in the relevant financial year.
ADVISERS TO THE REMUNERATION COMMITTEE
Korn Ferry were appointed by the Remuneration Committee to advise on remuneration and incentive plan related matters from 4 March 2021. Korn Ferry is a
signatory to the Remuneration Consultants’ Group Code of Conduct. The Committee has reviewed the nature of the services provided by Korn Ferry and is satisfied
that no conflict of interest exists in the provision of these services. The Company received no other services from Korn Ferry during the year. The total fees paid to
Korn Ferry in respect of the services to the Committee during the year were £59,865 (2022: £25,720). Fees were determined based on the scope and nature of the
projects undertaken for the Committee.
The Committee reviews the performance and independence of its advisers on an annual basis.
The Committee consults internally with the Group Chief Executive (Michael Ord) and the Group Legal Director & Company Secretary (Sarah Ellard). No executive is
involved in discussions on their own pay.
SHAREHOLDER VOTING ON THE DIRECTORS’ REMUNERATION POLICY AT THE 2022 ANNUAL GENERAL MEETING
The directors’ remuneration policy is subject to a binding vote by shareholders every three years. At the Annual General Meeting held on 3 March2022, the
resolution relating to the directors’ remuneration policy received the following votes from shareholders:
For 231,710,461 98.45%
Against 3,654,614 1.55%
Total votes cast (for and against excluding withheld votes) 235,365,075 100.0%
Votes withheld
1
7,154,172
Total votes cast (including withheld votes) 242,519,247
NOTE:
1. A vote withheld is not a vote in law and is not counted in the calculation of the proportion of votes cast “for” and “against” a resolution.
SHAREHOLDER VOTING ON THE DIRECTORS’ REMUNERATION REPORT AT THE 2023 ANNUAL GENERAL MEETING
The directors’ remuneration report is subject to an advisory vote by shareholders every year. At the Annual General Meeting held on 15 March 2023, the
resolution relating to the directors’ remuneration report received the following votes from shareholders:
For 231,807,952 98.19%
Against 4,266,893 1.81%
Total votes cast (for and against excluding withheld votes) 236,074,845 100.0%
Votes withheld
1
26,131
Total votes cast (including withheld votes) 236,100,976
NOTE:
1. A vote withheld is not a vote in law and is not counted in the calculation of the proportion of votes cast “for” and “against” a resolution.
DIRECTORS’ REMUNERATION REPORT continued
ADDITIONAL STATUTORY INFORMATION
ONREMUNERATION ARRANGEMENTS continued
Chemring Group PLC Annual report and accounts 2023114

DIRECTORS’ REMUNERATION POLICY
KEY OBJECTIVES
In developing a policy for the executive directors’ remuneration, the Remuneration Committee seeks to:
- maintain a competitive package of rewards required to promote the long-term success of the Company, without being excessive by reference to market rates
across comparator companies, and neither encouraging nor rewarding inappropriate risk taking;
- ensure performance-related elements:
> are transparent, stretching and rigorously applied;
> form a significant proportion of the total remuneration package of each executive director; and
> align the interests of executives with those of shareholders, by ensuring that a significant proportion of remuneration is performance related
anddeliveredin shares; and
- set remuneration in the context of the core values of the business and with the aim of alignment with culture.
The remuneration policy for the executive directors and other senior executives is also designed with regard to the policy for employees across the Group as
awhole. However, there are some differences in the structure of the remuneration policy for executive directors and other senior executives. In general, these
differences arise from the development of remuneration arrangements that are market-competitive for the various categories of individuals. They also reflect
thefact that, in the case of the executive directors and other senior executives, a greater emphasis tends to be placed on performance-related pay in the market.
DECISION MAKING PROCESS
The Committee periodically reviews the policy and its implementation to ensure it continues to allow us to incentivise and reward the executive directors to
achieve our strategy in both the short and long-term. The views of our shareholders and investor representative bodies are taken into account in determining
the policy and implementation each year as well as the UK Corporate Governance Code and market practice. The Committee also has regard to the general
paylevels and policies across the Group and takes these into account when setting executive director pay.
Operation of the policy is considered annually for the year ahead in light of the strategy and wider stakeholder experience, including the level of salary increase,
the types of performance metrics, and the weightings and target ranges for incentives.
CONSIDERATION OF CODE PROVISIONS IN DETERMINING POLICY
When developing the current directors’ remuneration policy for the executive directors, the Remuneration Committee also addressed the following factors
outlined in the 2018 Code:
FACTOR HOW THIS HAS BEEN ADDRESSED
CLARITY
Remuneration arrangements should be
transparent and promote effective engagement
with shareholders and the workforce.
The Chair of the Remuneration Committee consults with major shareholders on the directors’
remuneration policy, which is subject to shareholder approval every three years, and on any significant
proposed changes to the policy.
The employee engagement initiatives implemented by the Board provide an opportunity for employees
toexpress their views on a wide range of topics, including directors’ remuneration arrangements.
SIMPLICITY
Remuneration structures should avoid
complexity and their rationale and
operationshould be easy to understand.
The Company operates only two incentive plans for the executive directors - an annual bonus plan to
incentivise and reward short-term performance and the PSP, which incentivises long-term performance and
aligns management’s interests with shareholder interests. The annual bonus plan structure for the executive
directors is broadly replicated in the bonus arrangements for the business unit leaders and their direct reports.
RISK
Remuneration arrangements should ensure
reputational and other risks from excessive
rewards, and behavioural risks that can
arisefrom target-based incentive plans,
areidentified and mitigated.
The annual bonus plan includes non-financial strategic objectives covering the management of risks in areas
such as safety and compliance, as well as requiring bonus deferral.
The inclusion of broad malus and clawback provisions in the incentive arrangements and the discretion
reserved by the Committee to override formulaic outcomes also mitigate the risk of inappropriate rewards.
PREDICTABILITY
The range of possible values of rewards to
individual directors and any other limits of
discretions should be identified and explained
at the time of approving the policy.
The directors’ remuneration policy imposes maximum levels for annual bonus payments and PSP awards,
and sets out the potential remuneration scenarios for executive directors at differing levels of performance.
The Remuneration Committee’s discretions are also detailed in the policy.
PROPORTIONALITY
The link between individual awards, the
delivery of strategy and the long-term
performance of the company should
beclear.Outcomes should not reward
poorperformance.
The annual bonus plan targets and performance conditions associated with PSP awards provide a direct link
between individuals’ incentive rewards and delivery of strategic objectives which underpin the long-term
performance of the Company.
The annual bonus plan and the PSP require threshold levels of performance before any payments are made
or awards vest, and the Remuneration Committee retains discretion to override formulaic outcomes if
deemed appropriate.
ALIGNMENT TO CULTURE
Incentive schemes should drive behaviours
consistent with company purpose, values
andstrategy.
The annual bonus plan includes non-financial strategic objectives which embrace the Company’s values of
Safety, Excellence and Innovation, and which are also aligned to the delivery of the Group’s agreed strategy.
The performance conditions under the PSP also incentivise long-term performance through the delivery of
strategy and shareholder value.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 115

POLICY SUMMARY
The table below and overleaf provides a summary of the current directors’ remuneration policy. The full policy was approved by shareholders at the Annual
General Meeting held on 3 March 2022 and can be found in the 2021 directors’ remuneration report included in the 2021 report and accounts on our website
(https://www.chemring.com/investors/annual-reports/2021). The policy remains valid until the 2025 Annual General Meeting.
> FURTHER DETAILS OF THE POLICY ARE SET OUT ON PAGES 118 TO 119, AND AN EXPLANATION OF HOW THE POLICY WILL BE APPLIED IN 2024
ISSET OUT ON PAGES 120 AND 122
EXECUTIVE DIRECTORS
Element Purpose and link to strategy Operation Maximum Performance assessment
Salary
- Reflects the performance
of the individual, their
skills and experience over
time, and the
responsibilities of the role
- Provides an appropriate
level of basic fixed income,
avoiding excessive risk
arising from over-reliance
on variable income
- Normally reviewed annually
witheffect from 1 January
- Benchmarked periodically against
companies with similar characteristics
within the same sector
- Salaries take account of
complexityof the role,
marketcompetitiveness, Group
performance and the increases
awarded to the wider workforce
- Salary increases will normally be in line
with those received by the
widerworkforce
- More significant increases may be
awarded at the discretion of the
Committee, for example where there
isa change in responsibilities, to reflect
individual development and performance
in the role
- None, although overall individual and company
performance is a factor considered when
setting andreviewing salaries
Bonus
- Incentivises annual
delivery of financial,
strategic and personal goals
- Maximum bonus only
payable for achieving
demanding targets
- Delivery of a proportion
of bonus indeferred
shares plus the ability
toreceive dividend
equivalents provides
alignment with
shareholders’ interests
andassists with retention
- Paid in cash, with up to 40%
deferred as a conditional award
ofdeferred shares
- Vesting of deferred shares is
subject to continued employment
(save in “good leaver” scenarios) at
the end of three years from the
award of thebonus
- The payment of any earned bonus
remains ultimately at the discretion
of the Committee
- Non-pensionable
- Executives are entitled to receive,
on vesting of deferred share
awards, the value of dividend
payments that would otherwise
have been paid on the deferred
shares during the deferral period
- Chief Executive – 150% of salary
- Other executive directors – 125%
ofsalary
- Mix of Group financial and non-financial
objectives. Financial objectives will determine
the majority of the award and will typically
include a measure of profitability and cash
flow, although the Committee has discretion
to select other metrics
- Non-financial objectives will be measurable
and linked to goals that are consistent with
theGroup’s strategy
- Payment of the non-financial objectives
element will be subject toan underpin based
on the Committee’s assessment of underlying
business performance, including inter alia levels
of profitability and cash flow, as well ashealth
and safety performance
- Performance below the threshold for each
financial target results in zero payment in
respect of that element. Payment rises from
0% to 100% of the maximum opportunity for
levels of performance between threshold and
maximum with 50% of the maximum normally
payable for on-target performance
- Includes a malus and clawbackmechanism
6
Long-term
incentive plan
(performance
share plan
– “PSP”)
- Incentivises executives to
achieve targets aligned to
the Group’s mainstrategic
objectives of delivering
sustainable growth
andshareholder returns
- Delivery of awards in
shares plus theability to
receive dividend
equivalents helps align
executives’ rewards with
shareholders’ interests
- Annual grants of shares, which
vestsubject to the Group’s
performance measured over at
least three years
- Any shares vesting must be held by
the executives for a further period
of two years
- Executives are entitled to receive
the value of dividend payments
that would otherwise have been
paid onvested awards
- All awards are subject to the
discretions given to the
Committeein the plan rules
duringthe vesting period
- Normally 150% of base salary (although
grants of up to 200% ofbase salary may
bemade in exceptional circumstances
such asonrecruitment)
- Awards will be subject to a combination of
long-term measures which are aligned to the
shareholder experience and may include
financial metrics (such as EPS), shareholder
value metrics (such as TSR), capital efficiency
measures (such as ROCE) and ESG or
strategicmeasures
- The Committee will have discretion to
setdifferent measures and weightings for
awards in future years to best support
thestrategy of the business at that time
- Targets for each performance measure are set
by the Remuneration Committee prior to each
grant. Targets will be based on a sliding scale
where appropriate
- For each measure, performance below
threshold results in zero payment. Payment
rises from 25% to 100% of the maximum
opportunity for that measure for levels of
performance between threshold and maximum
- Includes a malus and clawback mechanism
6
DIRECTORS’ REMUNERATION REPORT continued
DIRECTORS’ REMUNERATION POLICY continued
Chemring Group PLC Annual report and accounts 2023116

Element Purpose and link to strategy Operation Maximum Performance assessment
All-employee
share scheme
- UK employees, including
executive directors, are
encouraged to acquire
shares by participating in
the Group’s all-employee
share plan – the UK
Sharesave Plan
- The UK Sharesave Plan has
standardterms
- Participation limits are those set
outbyHM Revenue & Customs
fromtime to time
- N/A
Pension
- Provides retirement
benefits that reward
sustained contribution
- Ongoing pension provision is in the
form of a cash supplement, subject
to auto-enrolment in the Group’s
defined contribution scheme
- Longer-serving employees have
accrued benefits under the
Group’s defined benefit scheme,
which was closed to future accrual
for the executive directors on
6April 2010
- Legacy arrangements: 20% of base salary
cash supplement contribution paid in lieu
of occupational pension scheme membership
- New appointments: 10% of base salary
cash supplement contribution paid in lieu
of occupational pension scheme membership
- All UK employees, including the
executive directors, are subject to
auto-enrolment into the Group’s defined
contribution scheme, with an employer
contribution of a minimum of 6% of base
salary. If executives do not opt out of
this scheme, their cash supplement will
be reduced by 6%
- From 1 November 2022, incumbent
executive director pensions will reduce
to the typical workforce rate via a
cliff-edge reduction
- N/A
Other
benefits
- Provides a competitive
package of benefits that
assists with recruitment
and retention
- Main benefits currently provided
toUK executives include but
arenot limited to a car
allowance,lifeassurance and
private medicalinsurance
- Executive directors are eligible for
other benefits which may also be
introduced for the wider workforce
on broadly similar terms
- Cash allowance in lieu of company car
ofup to £25,000 per annum
- Other benefits will be in line with
market. The value of each benefit is
based on the cost to the Company
andisnot pre-determined
- Any reasonable business-related expenses
(including tax thereon) can be reimbursed
if determined to be a taxable benefit
- N/A
Minimum
shareholding
requirements
- Aligns the interests of the
executive directors with
those of shareholders
- Executive directors are expected
to build up and maintain a
shareholding in the company
equivalent to 200% of base salary,
by retaining at least 50% of the
after-tax gain on vested PSP
awards until such time as the
guidelines have been met
- From November 2021, the
executive directors will be
required to hold shares to the
value of the shareholding guideline
(i.e. 200% ofbase salary or their
existing shareholding if lower at
the time) for two years
post-cessation of employment.
The shareholding will be assessed
at the point of stepping down
from the Board
NOTES:
1. A description of how the Company intends to implement the policy set out in this
table for the forthcoming year is set out in the annual report on remuneration on
pages 120 to 122.
2. The all-employee share plan does not have performance conditions. UK-based
executive directors are eligible to participate in the UK Sharesave Plan on the same
terms as other employees.
3. The Committee may make minor amendments to the policy set out above for
regulatory, exchange control, tax or administrative purposes or to take account of a
change in legislation, without obtaining shareholder approval for that amendment.
4. The Regulations and investor guidance encourages companies to disclose a cap within
which each element of the directors’ remuneration policy will operate. Where
maximum amounts for elements of remuneration have been set within the policy,
these will operate simply as caps and are not indicative of any aspiration.
5. While the Committee does not consider it to form part of benefits in the normal
usage of that term, it has been advised that corporate hospitality, whether paid for by
the Company or another, and business travel for directors and in exceptional
circumstances their families, may technically come within the applicable rules, and so
the Committee expressly reserves the right for the Committee to authorise such
activities within its agreed policies (and to discharge any related tax liability).
6. The annual bonus and PSP are subject to malus and clawback provisions in the event
of misconduct, error in calculation of performance, material misstatement of results,
company insolvency or serious reputational damage to the Group.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 117

COMMITTEE DISCRETIONS
The Committee operates the Group’s variable incentive plans according to
their respective rules and in accordance with governing legislation and HM
Revenue & Customs rules where relevant. To ensure the efficient administration
of these plans, the Committee will apply certain operational discretions.
These include the following:
- selecting the participants in the plans on an annual basis;
- determining the timing of grants of awards and/or payment;
- determining the quantum of awards and/or payments (within the limits
setout in the remuneration policy);
- determining the extent of vesting based on the assessment of performance;
- making the appropriate adjustments required in certain circumstances
(e.g.change of control, rights issues, corporate restructuring events and
special dividends);
- determining “good leaver” status for incentive plan purposes and applying
the appropriate treatment; and
- undertaking the annual review of weighting of performance measures, and
setting targets for the annual bonus plan and the PSP from year to year.
If an event occurs which results in the annual bonus plan or PSP performance
conditions and/or targets being deemed no longer appropriate by the Committee
(e.g. a material acquisition or divestment), the Committee will have the ability
to adjust appropriately the measures and/or targets and alter weightings,
provided that the revised conditions or targets are not materially less difficult
to satisfy (taking account of the relevant circumstances).
Ultimately, the payment of any bonus is entirely at the discretion of the Committee.
Equally, the operation of share incentive schemes is at the discretion of the
Committee. In conjunction with malus and clawback provisions, the Committee
has the flexibility to override formulaic outcomes and recover and/or withhold
sums. In choosing to use this discretion, the Committee will consider the
specific circumstances at the time.
Where such action is considered necessary, this will be clearly stated in the
relevant directors’ remuneration report.
HOW THE EXECUTIVE DIRECTORS’ REMUNERATION POLICY
RELATES TO THE WIDER GROUP
In addition to determining the remuneration arrangements for the executive
directors, the Committee considers and approves the base salaries for eight
other non-US senior executives. The Committee also receives information
ongeneral pay levels and policies across the Group. The Committee,
therefore, has due regard to salary levels across the Group in applying
itsremuneration policy.
During the year, the designated non-executive director for employee
engagement held a number of remote meetings with employees from across
the Group in which the Group’s key priorities going forward and the business
strategy were discussed. Topics discussed during these meetings also included
remuneration with the designated non-executive director sharing with employees
how remuneration links to business strategy and how performance is
determined. Employees are encouraged to ask questions and share their
views during these meetings.
The remuneration policy described above provides an overview of the
structure that operates for the most senior executives in the Group. Lower
aggregate incentive quanta are applied at below executive level, with levels
driven by market comparatives and the impact of the role.
Employees are provided with a competitive package of benefits, which typically
includes participation in the Group’s defined contribution pension arrangements.
Long-term incentives are provided to the most senior executives and those
identified as having the greatest potential to influence performance within the
Group. However, in order to encourage wider employee share ownership,
the Company also operates a Sharesave Plan in the UK, in which all UK
employees are eligible to participate.
EXECUTIVE DIRECTORS’ SERVICE AGREEMENTS AND LOSS OFOFFICE PAYMENTS
The current executive directors have rolling service contracts, details of which are summarised in the table below:
Provision Detailed terms
Contract dates Michael Ord - 30 April 2018 (effective 1 June 2018)
Andrew Lewis - 12 December 2016 (effective 9 January 2017)
James Mortensen - 23 May 2023 (effective 1 November 2023)
Sarah Ellard - 2 November 2011 (effective 7 October 2011)
Notice period 12 months from both the Company and from the executive
Termination payments Contracts may be terminated without notice by the payment of a sum equal to the sum of salary due for the unexpired notice period
plus the fair value of any contractual benefits (including pension)
Payments may be made in instalments and in these circumstances, there is a requirement to mitigate loss
The executive directors’ service contracts are available for inspection at the Company’s registered office.
DIRECTORS’ REMUNERATION REPORT continued
DIRECTORS’ REMUNERATION POLICY continued
Chemring Group PLC Annual report and accounts 2023118

POLICY IN RESPECT OF THE CHAIRMAN AND NON-EXECUTIVE DIRECTORS
Element Purpose and link to strategy Operation Maximum
Performance
assessment
The Chairman’s
and non-
executive
directors’ fees
Takes account of recognised
practice and set at a level that is
sufficient to attract and retain
high-calibre non-executives
- The Chairman is paid a single fee for all his responsibilities. The non-executive
directors are paid a basic fee. The Chairs of the Remuneration Committee
and the Audit Committee, the Senior Independent Director and the
non-executive director responsible for employee engagement each
receiveadditional fees to reflect their extra responsibilities
- When reviewing fee levels, account is taken of market movements in
non-executive director fees, Board Committee responsibilities, ongoing
time commitments, the general economic environment and the level of
increases awarded to the wider workforce
- Fee increases, if applicable, are normally effective from January of each year
- Non-executive directors do not participate in any pension, bonus or share
incentive plans
- Non-executive directors may be compensated for travel, accommodation or
hospitality-related expenses in connection with their roles and any tax thereon
- In exceptional circumstances, additional fees may be paid where there is a
substantial increase in the temporary time commitment required of
non-executive directors
- N/A - N/A
CHAIRMAN’S AND NON-EXECUTIVE DIRECTORS’ LETTERS OF APPOINTMENT
Non-executive directors do not receive compensation for loss of office but are appointed for a fixed term of three years, renewable for further three-year
terms if both parties agree and subject to annual re-election by shareholders. The Chairman’s appointment may be terminated on six months’ notice by either
party and the other non-executive directors’ appointments may be terminated on three months’ notice by either party. The non-executive directors’ letters of
appointment are available for inspection at the Company’s registered office.
The following table provides details of the terms of appointment for the Chairman and the current non-executive directors:
Non-executive Date original term commenced Date current term commenced Expected expiry date of current term
Carl-Peter Forster 1 May 2016 1 May 2022 30 April 2025
Alpna Amar 13 June 2023 13 June 2023 12 June 2026
Laurie Bowen 1 August 2019 1 August 2022 31 July 2025
Andrew Davies 17 May 2016 17 May 2022 16 May 2025
Stephen King 1 December 2018 1 December 2021 30 November 2024
Fiona MacAulay 3 June 2020 3 June 2023 2 June 2026
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 119

APPLICATION OF THE REMUNERATION POLICY IN 2024
This part of the report sets out how the approved directors’ remuneration policy will be implemented in 2024.
EXECUTIVE DIRECTORS
Element Implementation
Salary - The executive directors’ salaries were reviewed in November 2023, and the following salary increases were agreed, effective 1 January 2024:
> Michael Ord - £577,200
> Sarah Ellard - £291,177
> Andrew Lewis will be retiring from his role as Chief Financial Officer on 31 December 2023 and therefore no salary increase
wasawarded.
> James Mortensen joined the Board on a salary of £370,000 with effect from 1 November 2023.
- The increases for the Group Chief Executive and the Group Legal Director & Company Secretary were agreed at 4%, with the rate of increase
below the range of budgeted increases of 5% to 7% that were set by, and then agreed with, each individual operating business for 2024.
Benefits - No changes are proposed to the benefits provision for 2024.
Pension - The executive directors will receive a pension contribution of 7.5% of salary, which aligns with the typical rate of workforce pension provision.
Bonus - The maximum bonus opportunity will be 150% of salary for the Group Chief Executive and 125% of salary for the new Chief Financial
Officer and the Group Legal Director & Company Secretary. Andrew Lewis will not receive a bonus for 2024.
- The financial performance measures and weightings of financial performance measures and strategic objectives for the annual bonus plan
will be unchanged:
> Earnings per share 40%
> Operating cash flow 40%
> Strategic objectives 20%
- Strategic objectives have been set to reflect performance in the following key areas:
> Safety, including ensuring that the Group’s total recordable injury frequency rate and frequency of process safety events remain
below the targeted maximum rates
> Sustainability, including the continued delivery of reductions in the Group’s scope 1 and scope 2 carbon emissions
> Ongoing development and deployment of the Code of Conduct, the Operational Framework and the operational assurance policies,
processes and standards
> Continued development and deployment of common standards for the protection of people, property, information and technology,
with specific emphasis on cyber-security
> People management, including the continued strengthening of employee engagement activities
> Delivery of diversity, equity and inclusion objectives
> Delivery of organic and inorganic growth strategies for Roke
> Delivery of continued growth in the US space and missiles markets
> Delivery of sustainable growth in the energetic materials market and execution of the associated capital investment programmes
> Delivery of the US DoD bio-security Programs of Record
> Reassess the future strategy for the Countermeasures businesses
- The Committee does not believe that it would be in shareholders’ interests to prospectively disclose the financial targets under the annual
bonus plan due to issues of commercial sensitivity. However, detailed retrospective disclosure of both the financial targets and the strategic
objectives, and performance against them, will be included in next year’s annual report on remuneration. As was the case in 2023, the
range of financial targets approved for 2024 have been set in the context of current business planning and the current economic outlook.
Overall, the targets are considered similarly challenging to those set in prior years in the current market context.
- No bonus will be payable in respect of the strategic objectives unless the Committee is satisfied that this is justified by the Group’s
underlying performance, including inter alia levels of profitability and cash flow, as well as health and safety performance.
DIRECTORS’ REMUNERATION REPORT continued
DIRECTORS’ REMUNERATION POLICY continued
Chemring Group PLC Annual report and accounts 2023120

Element Implementation
Performance
Share Plan
(“PSP”)
- Executive directors will be granted PSP awards over 150% of salary in 2024. Andrew Lewis will not receive a PSP award in 2024.
- Performance conditions for 2024 (tested over a three-year performance period to 31 October 2026) and weightings will be 50% EPS,
30% relative TSR and 20% ESG targets. 25% of each part of the award will vest for threshold or median performance, with full vesting
ofeach part of the award for stretch or upper quartile performance.
- The EPS performance condition for the 2024 awards will be measured as follows:
Total compound EPS growth
over the three-year performance period
1
% of EPS part that may vest
Less than 5% p.a. 0%
5% p.a. 25%
Between 5% p.a. and 10% p.a. On a straight-line basis between 25% and 100%
10% p.a. or more 100%
- The TSR performance condition for the 2024 awards will be measured as follows:
Rank of the Company’s TSR against the TSR of the FTSE All-Share
(excludinginvestment trusts) over the three-year performance period % of TSR part that may vest
Below median 0%
Median 25%
Between median and upper quartile On a straight-line basis between 25% and 100%
Upper quartile or above 100%
- The ESG performance condition for the 2024 awards will be measured as follows:
Reduction in scope 1 and scope 2 emissions (market-based)
over the three-year performance period % of ESG part that may vest
Less than 15% 0%
15% 25%
Between 15% and 25% On a straight-line basis between 25% and 100%
25% or more 100%
- The choice of EPS, TSR and emissions reduction targets aligns with the Group’s long-term strategic objectives of delivering profitable
growth and shareholder returns on a sustainable basis. The range of EPS and emissions reduction targets were set with reference to
internal plans, market expectations and current economic circumstances. The overall targets are similarly challenging to those set in prior
years in the context of current market conditions.
NOTES:
1. The EPS target range is considered stretching when viewed against internal forecasts and a broader reflection of prevailing macroeconomic factors.
2. The reduction in scope 1 and scope 2 emissions target is aligned with our strategy of becoming net zero by 2030 and takes into account the expected
glidepath to reaching this goal.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 121

APPLICATION OF THE REMUNERATION POLICY IN 2024 continued
FEES FOR THE CHAIRMAN AND NON-EXECUTIVE DIRECTORS
As detailed in the directors’ remuneration policy, the Company’s approach to setting the non-executive directors’ remuneration takes account of recognised
practice, and is set at a level that is sufficient to attract and retain high-calibre non-executives. The fees for the non-executive directors are determined by the
executive directors and the Chairman, and the Remuneration Committee determines the fees for the Chairman.
Details of the fees that will apply for 2024 are set out below:
Fee as at
1 January 2024
Percentage
increase
Chairman’s fee £224,952 4%
Other non-executive directors’ base fee £61,862 4%
Audit Committee Chair fee £10,000 —
Remuneration Committee Chair fee £10,000 —
Senior Independent Director fee £10,000 —
Non-executive directors’ fee for employee engagement £5,000 —
APPROVAL OF THE DIRECTORS’ REMUNERATION REPORT
The directors’ remuneration report was approved by the Board on 12 December 2023.
Signed on behalf of the Board
Laurie Bowen
Chair of the Remuneration Committee
12 December 2023
DIRECTORS’ REMUNERATION REPORT continued
DIRECTORS’ REMUNERATION POLICY continued
Chemring Group PLC Annual report and accounts 2023122

DIRECTORS’ REPORT
The directors present their annual report, together with the audited
financialstatements of the Group and the Company, for the year ended
31October2023.
The following sections of the annual report are incorporated into the
directors’ report by reference:
- strategic report on pages 1 to 78;
- corporate governance report on pages 84 to 88;
- Audit Committee report on pages 94 to 97;
- directors’ remuneration report on pages 100 to 122; and
- notes to the Group financial statements as detailed in this section.
BUSINESS REVIEW
The strategic report on pages 1 to 78 provides a review of the Group’s
business development, performance and position during and at the end of the
financial year, its strategy and likely future developments, key performance
indicators, and a description of the principal risks and uncertainties facing the
business. Further information regarding financial risk management policies and
financial instruments is given in note 22 to the Group financial statements.
There have been no significant events since the balance sheet date.
RESULTS AND DIVIDENDS
The profit attributable to the Group’s shareholders for the year was £5.4m
(2022: £47.4m).
The directors are recommending the payment of a final dividend of 4.6p per
ordinary share which, together with the interim dividend of 2.3p per share
paid in September 2023, gives a total for the year of 6.9p (2022: 5.7p). The
final dividend is subject to approval by shareholders at the Annual General
Meeting on 23 February 2024 and has not therefore been included as a
liability in these financial statements.
DIRECTORS AND THEIR INTERESTS
The current directors are shown on pages 82 and 83.
In accordance with the Company’s Articles of Association, all directors are
required to submit themselves for election or re-election at every Annual
General Meeting. All directors will therefore be seeking election or
re-election at the Annual General Meeting on 23 February 2024.
Details of the service contracts entered into between the Company and
theexecutive directors are set out in the directors’ remuneration report
onpage 118. The non-executive directors do not have service contracts with
theCompany.
The Company maintains directors’ and officers’ liability insurance in respect
of legal action against its directors and officers. The Company has also granted
indemnities to its directors to the extent provided by law (which are qualifying
third party indemnities within the meaning of section 236 of the Companies
Act 2006). Neither the insurance nor the indemnities provide cover in the
event of proven fraudulent or dishonest activity.
Other than in relation to their service contracts, none of the directors is or
was beneficially interested in any significant contract to which the Group was
a party during the year ended 31 October 2023.
Information required in relation to directors’ shareholdings is set out in the
directors’ remuneration report on page 110.
EMPLOYEES AND EMPLOYEE CONSULTATION
Details of the Group’s employment policies and employee consultation
practices are set out on pages 56 to 60.
The Group makes no distinction between disabled and able-bodied persons
in recruitment, employment and training, career development and promotion,
provided that any disability does not make the particular employment impractical
or impossible under the strict health and safety legislation under which the
Group’s businesses operate.
POLITICAL DONATIONS
No political donations were made during the year (2022: £nil).
CONTRACTUAL ARRANGEMENTS
The Group contracts with a wide range of customers, comprising governments,
armed forces, prime contractors and OEMs across the globe. The US
Department of Defense is the largest single customer and procures the
Group’s products under a significant number of separate contracts placed
with individual Group businesses.
The Group’s businesses utilise many suppliers across the world and
arrangements are in place to ensure that businesses are not totally reliant
onsingle suppliers for key raw materials or components.
RESEARCH AND DEVELOPMENT
The Group’s research and development expenditure for the year is detailed
in the financial review on page 65.
CHANGE OF CONTROL
Individual Group businesses have contractual arrangements with third parties,
entered into in the normal course of business, which may be amended or
mayterminate on a change of control of the relevant business, or in certain
circumstances, following a takeover of the Group.
The most significant agreements entered into by the Group which contain
provisions granting the counterparties certain rights in the event of a change
of control of the Company are the revolving credit facility agreements
entered into with the Group’s banks. These agreements provide that, in
theevent of a change of a control, the Company must repay all outstanding
borrowings, together with accrued interest and other sums owing under
eachagreement.
SHARE CAPITAL AND SHAREHOLDER RIGHTS
GENERAL
The Company’s share capital consists of ordinary shares of 1p each and
preference shares of £1 each, which are fully paid up and quoted on the main
market of the London Stock Exchange. Full details of the movements in the
issued share capital of the Company during the financial year are provided
innote 25 to the Group financial statements.
Details of the rights attaching to shares are set out in the Articles of Association
(the “Articles”). All holders of ordinary shares are entitled to attend, speak
and vote at any general meeting of the Company, and to appoint a proxy or
proxies to exercise these rights. At a general meeting, every shareholder
present in person, by proxy or (in the case of a corporate member) by
corporate representative has one vote on a show of hands, and on a poll
hasone vote for every share held. The Notice of Annual General Meeting
specifies deadlines for exercising voting rights and appointing a proxy or
proxies to vote in respect of the resolutions to be passed at the Annual
General Meeting.
A member or members representing at least 5% of the ordinary share capital
of the Company may require the directors to convene a general meeting. A
member or members representing at least 5% of the ordinary share capital
ofthe Company or at least 100 members with the right to vote at an Annual
General Meeting and each holding, on average, at least £100 of paid-up share
capital may request a resolution to be put before an Annual General Meeting.
There are no restrictions on the transfer of ordinary shares in the capital of
the Company, other than certain restrictions which may from time to time be
imposed by law. In accordance with the Market Abuse Regulation, certain
employees are required to seek the approval of the Company to deal in its shares.
The cumulative preference shares, which are also publicly traded on the London
Stock Exchange, carry an entitlement to a dividend at the rate of 7pper share
per annum, payable in equal instalments on 30 April and 31October each
year. Holders of the preference shares have the right on awinding-up to
receive, in priority to any other classes of shares, the sum of £1per share
together with any arrears of dividends. There are no restrictions on the
transfer of the cumulative preference shares.
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 123

SHARE CAPITAL AND SHAREHOLDER RIGHTS continued
GENERAL continued
The Company is not aware of any agreements between shareholders that
may result in restrictions on the transfer of securities and/or voting rights.
The Company’s Articles may only be amended by special resolution at a
general meeting of shareholders.
ISSUE OF SHARES
Under the provisions of section 551 of the Companies Act 2006 (the “Act”),
the Board is prevented from exercising its powers under the Articles to allot
shares without an authority contained either in the Articles or in a resolution
of the shareholders passed in general meeting. The authority, when given, can
last for a maximum period of five years, but the Board proposes that renewal
should be sought at each Annual General Meeting. An ordinary resolution, seeking
such authority, will be proposed at the forthcoming Annual General Meeting.
Section 561 of the Act requires that an allotment of shares for cash may not
be made unless the shares are first offered to existing shareholders on a
pre-emptive basis in accordance with the terms of the Act.
In accordance with general practice, to ensure that small issues of shares can
be made without the necessity of convening a general meeting, the Board
proposes that advantage be taken of the provisions of sections 570 and 573
of the Actnot to apply the Act’s pre-emptive requirements. Accordingly, a
special resolution will be proposed at the forthcoming Annual General
Meeting which, if passed, will have the effect of granting the directors the
power to allot not more than 20% of the issued ordinary share capital free
ofthe requirements of section 561 of the Act. No issue of these shares will
be made which would effectively alter the control of the Company without
the prior approval of the shareholders ingeneral meeting.
PURCHASE OF OWN SHARES
On 1 August 2023, the Company launched a share buyback programme for
the buyback of up to £50m of the Company’s ordinary shares over a one-year
period. 3,194,803 ordinary shares were purchased by the Company during
the year and subsequently cancelled. The Company did not hold any shares
intreasury at 31 October 2023 (2022: nil).
A special resolution will be proposed at the forthcoming Annual General
Meeting to renew the Company’s authority to purchase its own shares in the
market up to a limit of 10% of its issued ordinary share capital. The maximum
and minimum prices will be stated in the resolution at the date of the Annual
General Meeting. The directors believe that it is advantageous for the Company
to have this flexibility to make market purchases of its own shares. The directors
of the Company may consider holding repurchased shares pursuant to the
authority conferred by this resolution as treasury shares. This will give the
Company the ability to reissue treasury shares quickly and cost effectively,
and will provide the Company with additional flexibility in the management
ofits capital base. Any issues of treasury shares for the purposes of the Company’s
employee share schemes will be made within the 10% anti-dilution limit set by
The Investment Association. The directors will only exercise this authority if
they are satisfied that a purchase would result in an increase in expected
earnings per share and would be in the interests of shareholders generally.
SUBSTANTIAL SHAREHOLDINGS
At 11 December 2023, the following substantial holdings in the ordinary share
capital of the Company had been notified to the Company in accordance with
Chapter 5 of the Disclosure and Transparency Rules of the Financial Conduct
Authority. It should be noted that these holdings may have changed since the
Company was notified; however, notification of any change is not required
until the next notifiable threshold is crossed.
NAME % INTEREST
Invesco Limited 8.1
BlackRock, Inc. 7.9
Old Mutual Asset Managers 5.1
Ameriprise Financial, Inc. and its group 5.0
J O Hambro Capital Management Limited 5.0
FIL Limited Below 5.0
Jupiter Fund Management PLC Below 5.0
Schroders Plc Below 5.0
AXA Investment Managers S.A. 4.9
Aviva PLC and its subsidiaries 4.9
J P Morgan Chase & Co 4.9
Royal London Asset Management Limited 4.9
Neptune Investment Management Limited 4.8
Prudential Plc 4.8
Investec Asset Management Limited 4.8
Standard Life Investments Limited 4.8
Norges Bank 4.0
BT Pension Scheme Trustees Limited as Trustee
oftheBTPension Scheme 3.8
EMPLOYEE SHARE SCHEMES AND PLANS
APPROACH TO SHARE OWNERSHIP
The Group actively encourages its employees to share in the future success
ofthe Group, and therefore operates share-based arrangements to provide
incentives and rewards to employees.
The Group operated three share-based incentive plans during the year, as set
out below. Further details of awards and vesting are provided in note 27 to
the Group financial statements.
THE CHEMRING GROUP 2018 UK SHARESAVE PLAN
(THE“UKSHARESAVE PLAN”)
The UK Sharesave Plan is open to all eligible UK employees. Employees may
choose between three and five-year savings periods, at the end of which the
employee can choose to exercise the option or seek the return of their
savings. A grant of options was made on 4 August 2023.
THE CHEMRING GROUP PERFORMANCE SHARE PLAN 2016
(THE“2016 PSP”)
The 2016 PSP is the primary long-term incentive plan for executive directors
and senior employees. Discretionary awards are granted under the PSP over
a fixed number of shares by reference to salary, with awards ordinarily
vesting, subject to meeting performance criteria, on the third anniversary of
the grant date. Awards were granted under the plan on 14 December 2022.
THE CHEMRING GROUP RESTRICTED SHARE PLAN (THE “RSP”)
The RSP provides for the discretionary grant of deferred share awards to
selected key employees. Executive directors are not eligible to participate.
Awards typically vest on the second or third anniversary of the grant date,
subject to meeting continuous service criteria. Awards under the RSP may
only be satisfied with market-purchased shares. No awards were granted
under the plan during the year.
GOING CONCERN
Details of the conclusions arrived at by the directors in preparing the financial
statements on a going concern basis are set out in the viability statement on
page 77.
DIRECTORS’ REPORT continued
Chemring Group PLC Annual report and accounts 2023124

ADDITIONAL INFORMATION, AS REQUIRED BY LISTING RULES
REQUIREMENT 9.8.4
The annual report is required to contain certain information under Listing
Rules Requirement 9.8.4. Where this information has not been cross-referenced
within the Group financial statements, it can be found in the following sections:
- capitalised interest (see note 7);
- long-term incentive schemes (see directors’ remuneration report);
- allocation of equity securities for cash (see note 27);
- contracts of significance (see directors’ report);
- election of independent directors (see corporate governance report);
- contractual arrangements (see directors’ report);
- details of independent directors (see corporate governance report); and
- substantial shareholders (see directors’ report).
No profit forecasts are issued by the Group and no directors have waived
any current or future emoluments.
Other than in relation to ordinary shares held in treasury of which there
were none during the year, no shareholders have waived or agreed to
waivedividends.
None of the shareholders is considered to be a Controlling Shareholder
(asdefined in Listing Rule 6.1.2.A) and the Group complies with the
independence provisions of the Listing Rules.
PROVISION OF INFORMATION TO THE AUDITOR
Each director at the date of this report confirms that, so far as they are each
aware, there is no relevant audit information of which the Company’s auditor
is unaware, and each director has taken all the steps that he or she ought to
have taken as a director to make himself or herself aware of any relevant
audit information and to establish that the Company’s auditor is aware of
thatinformation.
This confirmation is given and should be interpreted in accordance with the
provisions of section 418 of the Companies Act 2006.
AUDITOR
Resolutions will be proposed at the forthcoming Annual General Meeting to
reappoint KPMG and to authorise the directors to determine the external
auditor’s remuneration.
ANNUAL GENERAL MEETING
The resolutions to be proposed at the Annual General Meeting to be held on
23 February 2024, together with explanatory notes, appear in the separate
Notice of Annual General Meeting sent to all shareholders.
STATEMENT OF DIRECTORS’ RESPONSIBILITIES IN RESPECT
OFTHEANNUAL REPORT AND ACCOUNTS
The directors are responsible for preparing the annual report and the Group
and parent company financial statements in accordance with applicable law
and regulations.
Company law requires the directors to prepare Group and parent company
financial statements for each financial year. Under that law they are required
to prepare the Group financial statements in accordance with UK-adopted
international accounting standards and applicable law, and they have elected
toprepare the parent company financial statements in accordance with
UKaccounting standards and applicable law, including FRS 101 Reduced
DisclosureFramework.
Under company law the directors must not approve the financial statements
unless they are satisfied that they give a true and fair view of the state of
affairs of the Group and parent company and of their profit or loss for that
period. In preparing each of the Group and parent company financial
statements, the directors are required to:
- select suitable accounting policies and then apply them consistently;
- make judgements and estimates that are reasonable, relevant, reliable
andprudent;
- for the Group financial statements, state whether they have been prepared
in accordance with UK-adopted international accounting standards;
- for the parent company financial statements, state whether applicable UK
accounting standards have been followed, subject to any material departures
disclosed and explained in the parent company financial statements;
- assess the Group and parent company’s ability to continue as a going
concern, disclosing, as applicable, matters related to going concern; and
- use the going concern basis of accounting unless they either intend to
liquidate the Group or the parent company or to cease operations,
orhaveno realistic alternative but to do so.
The directors are responsible for keeping adequate accounting records that
are sufficient to show and explain the parent company’s transactions and
disclose with reasonable accuracy at any time the financial position of the
parent company and enable them to ensure that its financial statements
comply with the Companies Act 2006. They are responsible for such internal
control as they determine is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud
or error, and have general responsibility for taking such steps as are reasonably
open to them to safeguard the assets of the Group and to prevent and detect
fraud and other irregularities.
Under applicable law and regulations, the directors are also responsible for
preparing a strategic report, directors’ report, directors’ remuneration report
and corporate governance report that comply with that law and those regulations.
The directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company’s website.
Legislation in the UK governing the preparation and dissemination of
financialstatements may differ from legislation in other jurisdictions.
In accordance with Disclosure Guidance and Transparency Rule 4.1.14R, the
financial statements will form part of the annual report prepared under the
single electronic reporting format under the TD ESEF Regulation. The auditor’s
report on these financial statements provides no assurance over the ESEF format.
RESPONSIBILITY STATEMENT OF THE DIRECTORS IN RESPECT
OFTHE ANNUAL FINANCIALREPORT
We confirm that to the best of our knowledge:
- the financial statements, prepared in accordance with the applicable set
ofaccounting standards, give a true and fair view of the assets, liabilities,
financial position and profit or loss of the Company and the undertakings
included in the consolidation taken as a whole; and
- the strategic report and directors’ report include a fair review of the
development and performance of the business and the position of the issuer
and the undertakings included in the consolidation taken as a whole, together
with a description of the principal risks and uncertainties that they face.
We consider the annual report and accounts, taken as a whole, is fair,
balanced and understandable and provides the information necessary for
shareholders to assess the Group’s position and performance, business
modeland strategy.
The strategic report, the directors’ report and the responsibility statement
were approved by the Board of directors on 12 December 2023 and are
signed on its behalf by:
Michael Ord Sarah Ellard
Group Chief Executive Group Legal Director
12 December 2023 12 December 2023
GOVERNANCE
Chemring Group PLC Annual report and accounts 2023 125

FINANCIAL STATEMENTS
IN THIS SECTION:
127 Consolidated income statement
12 8 Consolidated statement of comprehensive income
129 Consolidated statement of changes in equity
130 Consolidated balance sheet
131 Consolidated cash flow statement
132 Notes to the Group financial statements
16 0 Parent company balance sheet
161 Parent company statement of comprehensive income
161 Parent company statement of changes in equity
162 Notes to the parent company financial statements
16 6 Accounting policies
173 Independent auditor’s report to the members of Chemring Group PLC
179 Five-year record
Chemring Group PLC Annual report and accounts 2023126

CONSOLIDATED INCOME STATEMENT
For the year ended 31 October 2023
2023
2022
Non-
Non-
Underlying
underlying
Underlying
underlying
performance
items
1
To t a l
performance
items
Note
£m
£m
£m
£m
£m
£m
Revenue
1,2
472.6
—
472.6
401.0
—
401.0
Operating profit
2,4
69.2
(23.8)
45.4
59.4
(10.0)
49.4
Finance expense
7
(1.3)
—
(1.3)
(1.5)
—
(1.5)
Profit before tax
67.9
(23.8)
44.1
57.9
(10.0)
47.9
Taxation
8
(10.2)
3.8
(6.4)
(4.6)
1.1
(3.5)
Profit after tax
57.7
(20.0)
37.7
53.3
(8.9)
44.4
(Loss)/profit after tax from discontinued operations
5
(0.9)
(31.4)
(32.3)
3.5
(0.5)
3.0
Profit after tax
56.8
(51.4)
5.4
56.8
(9.4)
47.4
Basic
10
20.5p
13.4p
19.0p
15.8p
Diluted
10
20.0p
13.1p
18.5p
15.4p
Basic
10
20.2p
1.9p
20.2p
16.9p
Diluted
10
19.7p
1.9p
19.7p
16.4p
2
1
1. Further information about non-underlying items is set out in note 3.
2. 2022 comparative information has been re-presented due to a change in classification for discontinued operations. See note 5 for further details.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 127

CONSOLIDATED STATEMENT OF COMPREHENSIVEINCOME
For the year ended 31 October 2023
2023
2022
Note
£m
£m
Profit after tax attributable to equity holders of the parent as reported
5.4
47.4
Remeasurement of the defined benefit pension scheme
29
(4.7)
(2.3)
Movement on deferred tax relating to the pension scheme
24
1.6
0.8
(3.1)
(1.5)
Exchange differences on translation of foreign operations
(15.2)
35.0
Tax on exchange differences on translation of foreign operations
(1.1)
(0.4)
(16.3)
34.6
Total comprehensive (loss)/income attributable to equity holders of the parent
(14.0)
80.5
Chemring Group PLC Annual report and accounts 2023128

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 October 2023
Share
Special
Share
premium
capital
Translation
Retained
capital
account
reserve
reserve
earnings
Total
£m
£m
£m
£m
£m
£m
At 1 November 2022
2.8
307.7
12.9
7.5
87.2
418.1
Profit after tax
—
—
—
—
5.4
5.4
Other comprehensive loss
—
—
—
(15.2)
(4.7)
(19.9)
Tax relating to components of other comprehensive loss
—
—
—
(1.1)
1.6
0.5
Total comprehensive (loss)/income
—
—
—
(16.3)
2.3
(14.0)
Ordinary shares issued
—
1.0
—
—
—
1.0
Purchase of own shares
—
—
—
—
(16.9)
(16.9)
Share-based payments (net of settlement)
—
—
—
—
7.6
7.6
Dividends paid
—
—
—
—
(17.3)
(17.3)
At 31 October 2023
2.8
308.7
12.9
(8.8)
62.9
378.5
Share
Special
Share
premium
capital
Translation
Retained
capital
account
reserve
reserve
earnings
Total
£m
£m
£m
£m
£m
£m
At 1 November 2021
2.8
307.1
12.9
(27.1)
57.1
352.8
Profit after tax
—
—
—
—
47.4
47.4
Other comprehensive income/(loss)
—
—
—
35.0
(2.3)
32.7
Tax relating to components of other comprehensive income/(loss)
—
—
—
(0.4)
0.8
0.4
Total comprehensive income
—
—
—
34.6
45.9
80.5
Ordinary shares issued
—
0.6
—
—
—
0.6
Share-based payments (net of settlement)
—
—
—
—
5.6
5.6
Dividends paid
—
—
—
—
(14.4)
(14.4)
Purchase of own shares
—
—
—
—
(7.0)
(7.0)
At 31 October 2022
2.8
307.7
12.9
7.5
87.2
418.1
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 129

2023
2022
Note
£m
£m
£m
£m
Goodwill
11
100.5
118.1
Development costs
12
17.6
34.6
Other intangible assets
12
9.6
11.4
Property, plant and equipment
13
242.2
231.3
Retirement benefit surplus
29
5.9
11.2
Deferred tax
24
36.9
32.3
412.7
438.9
Inventories
15
101.7
99.6
Trade and other receivables
16
74.8
61.1
Cash and cash equivalents
17
6.4
19.8
Derivative financial instruments
22
0.8
0.7
183.7
181.2
Total assets
596.4
620.1
Lease liabilities
19
(1.1)
(1.8)
Trade and other payables
20
(124.0)
(98.2)
Provisions
23
(5.6)
(1.6)
Current tax
(8.2)
(7.9)
Derivative financial instruments
22
(3.2)
(4.2)
(142.1)
(113.7)
Borrowings
18, 32
(14.1)
(20.9)
Lease liabilities
19
(5.5)
(4.2)
Provisions
23
(12.0)
(16.8)
Deferred tax
24
(43.8)
(45.2)
Derivative financial instruments
22
(0.3)
(1.1)
Preference shares
18, 25
(0.1)
(0.1)
(75.8)
(88.3)
Total liabilities
(217.9)
(202.0)
Net assets
378.5
418.1
Share capital
25
2.8
2.8
Share premium account
26
308.7
307.7
Special capital reserve
26
12.9
12.9
Translation reserve
26
(8.8)
7.5
Retained earnings
62.9
87.2
Total equity
378.5
418.1
These financial statements of Chemring Group PLC (registered number 86662) were approved and authorised for issue by the Board of directors on
12 December 2023.
Signed on behalf of the Board
Michael Ord Andrew Lewis
Director Director
CONSOLIDATED BALANCE SHEET
As at 31 October 2023
Chemring Group PLC Annual report and accounts 2023130

CONSOLIDATED CASH FLOW STATEMENT
For the year ended 31 October 2023
2023
2022
2
Note
£m
£m
Cash generated from continuing underlying operations
30
80.0
85.1
Cash impact of continuing non-underlying items
(2.1)
(1.1)
Cash (utilised in)/generated from discontinued underlying operations
30
(0.8)
5.0
Cash impact of discontinued non-underlying items
(1.9)
—
Cash flows from operating activities
75.2
89.0
Tax paid
(9.3)
(8.5)
Net cash inflow from operating activities
65.9
80.5
Purchases of intangible assets
(1.5)
(3.0)
Purchases of property, plant and equipment
(32.7)
(31.5)
Acquisition of subsidiary net of cash acquired
28
(7.2)
—
Short-term funding to defined benefit pension scheme
34
2.0
(2.0)
Proceeds on disposal of property, plant and equipment
—
6.0
Net cash outflow from investing activities
(39.4)
(30.5)
Dividends paid
9
(17.3)
(14.4)
Purchase of own shares
(14.0)
(7.0)
Net proceeds for transactions in own shares
0.6
0.1
Finance expense paid
(0.7)
(1.3)
Capitalised facility fees paid
(0.3)
—
Drawdown of borrowings
60.1
30.0
Repayments of borrowings
(66.8)
(41.0)
Payment of lease liabilities
(1.8)
(2.2)
Net cash outflow from financing activities
(40.2)
(35.8)
(Decrease)/increase in cash and cash equivalents
31
(13.7)
14.2
19.8
5.4
Effect of foreign exchange rate changes
0.3
0.2
Cash and cash equivalents at end of year
17, 32
6.4
19.8
1
1. Cash and cash equivalents of £5.4m at the beginning of 2022 includes a bank overdraft
2. 2022 comparative information has been re-presented due to a change in classification for discontinued operations. See note 5 for further details.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 131

1. REVENUE
All of the Group’s revenue is derived from the sale of goods and the provision of services. The following table provides an analysis of the Group’s revenue
by destination:
Sensors
Countermeasures
& Information
& Energetics
2023
£m
£m
£m
UK
142.6
59.6
202.2
US
34.1
147.7
181.8
Europe
9.3
62.0
71.3
Asia Pacific
0.7
15.2
15.9
Rest of the world
0.3
1.1
1.4
187.0
285.6
472.6
Sensors
Countermeasures
& Information
& Energetics
2022
£m
£m
£m
UK
100.3
51.5
151.8
US
13.1
166.8
179.9
Europe
5.7
48.8
54.5
Asia Pacific
1.2
10.4
11.6
Rest of the world
0.2
3.0
3.2
120.5
280.5
401.0
The directors consider that the only countries that are significant in accordance with IFRS 8 Operating Segments are the US and the UK.
The following table discloses the split of the Group’s revenue between goods and services:
Sensors
Countermeasures
& Information
& Energetics
2023
£m
£m
£m
Goods
41.6
277.0
318.6
Services
145.4
8.6
154.0
187.0
285.6
472.6
Sensors
Countermeasures
& Information
& Energetics
2022
£m
£m
£m
Goods
19.6
274.3
293.9
Services
100.9
6.2
107.1
120.5
280.5
401.0
All revenues recognised arose from contracts with customers.
As at 31 October 2023 £922m (2022: £651m) of revenue was not yet recognised in respect of obligations that were unfulfilled or only partially fulfilled as
at the year end. £403m (2022: £403m) of this revenue is expected to be recognised in the next financial year and £519m (2022: £248m) in future periods.
2. BUSINESS SEGMENTS
IFRS 8 Operating Segments requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly
reviewed by the Group Chief Executive and the Board to allocate resources to the segments and to assess their performance. For management purposes,
the Group’s operating and reporting structure clusters similar businesses together, based on the products and services they offer. These segments are the
basis on which the Group reports its segmental information.
The principal activities of each segment are as follows:
Sensors & Information
Provision of consulting and technology services to solve security-critical issues. Development and manufacture of electronic
NOTES TO THE GROUP FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023132

2. BUSINESS SEGMENTS continued
A segmental analysis of revenue and operating profit is set out below:
Sensors
Countermeasures
& Information
& Energetics
Unallocated*
To t a l
Year ended 31 October 2023
£m
£m
£m
£m
Revenue
187.0
285.6
—
472.6
Segment result before depreciation, amortisation and non-underlying items and
discontinued operations
38.5
65.5
(15.5)
88.5
Depreciation
(3.6)
(15.0)
—
(18.6)
Amortisation
(0.7)
—
—
(0.7)
Segmental underlying operating profit
34.2
50.5
(15.5)
69.2
Amortisation of acquired intangibles (note 3)
(1.3)
(1.7)
—
(3.0)
Non-underlying items (note 3)**
(22.2)
—
1.4
(20.8)
Impact of non-underlying items on profit before tax (note 3)
(23.5)
(1.7)
1.4
(23.8)
Segmental operating profit
10.7
48.8
(14.1)
45.4
Finance expense
(1.3)
(1.3)
Profit before tax
(15.4)
44.1
Ta x
(6.4)
(6.4)
Profit for the year from continuing operations
(21.8)
37.7
Discontinued operations
(32.3)
—
—
(32.3)
Profit for the year
(21.6)
48.8
(21.8)
5.4
Sensors
Countermeasures
& Information
& Energetics
Unallocated*
Total
Year ended 31 October 2022
£m
£m
£m
£m
Revenue
120.5
280.5
—
401.0
Segment result before depreciation, amortisation and non-underlying items and
discontinued operations
28.0
64.2
(14.9)
77.3
Depreciation
(2.6)
(15.1)
—
(17.7)
Amortisation
—
(0.2)
—
(0.2)
Segmental underlying operating profit
25.4
48.9
(14.9)
59.4
Amortisation of acquired intangibles (note 3)
(1.8)
(2.1)
—
(3.9)
Non-underlying items (note 3)
(1.2)
—
(4.9)
(6.1)
Impact of non-underlying items on profit before tax (note 3)
(3.0)
(2.1)
(4.9)
(10.0)
Segmental operating profit
22.4
46.8
(19.8)
49.4
Finance expense
(1.5)
(1.5)
Profit before tax
(21.3)
47.9
Ta x
(3.5)
(3.5)
Profit for the year from continuing operations
(24.8)
44.4
Discontinued operations
3.0
—
—
3.0
Profit for the year
25.4
46.8
(24.8)
47.4
* Unallocated items are specific corporate level costs that cannot be allocated to a business segment.
** An impairment charge of £18.5m is included in Sensors & Information for the year ended 31 October 2023.
Assets and liabilities by segment are not reported to the Group Chief Executive on a monthly basis; therefore they are not used as a key decision making tool
and are not disclosed here. A disclosure of non-current assets by location, excluding retirement benefit surplus and deferred tax, is shown below:
2023
2022
Non-current assets by location
£m
£m
UK
167.5
149.4
US
166.8
211.5
Norway
20.4
18.0
Australia
15.2
16.5
369.9
395.4
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 133

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
2. BUSINESS SEGMENTS continued
INFORMATION ON MAJOR CUSTOMERS
Of the Group’s total revenue, £117.8m (2022: £124.4m) arose from sales to the US DoD, £59.9m (2022: £35.5m) arose from the sales to the UK MOD and
£54.5m (2022: £40.2m) arose from sales to BAE Systems plc. These were the only customers where direct sales accounted for more than 10% of Group
revenue for the year. Sales were reported in both of the Group’s segments.
3. ALTERNATIVE PERFORMANCE MEASURES
In accordance with our accounting policy we have presented the following reconciliation of alternative performance measures (“APMs”) used throughout this
report to their IFRS equivalent measures as follows:
2023
2022
Non-underlying items and non-underlying measures
£m
£m
Gain/(loss) on the movement in the fair value of derivative financial instruments (note 22)
1.4
(4.1)
Acquisition expenses (note 28)
(3.7)
(2.0)
Impairment of Chemical Detection assets
(18.5)
—
Release of disposal provisions (note 23)
3.2
—
Increase in legal and disposal provisions (note 23)
(3.2)
—
Impact of non-underlying items on EBITDA
(20.8)
(6.1)
Amortisation of acquired intangibles arising from business combinations (note 12)
(3.0)
(3.9)
Impact of non-underlying items on profit before tax
(23.8)
(10.0)
Tax impact of non-underlying items
3.8
1.1
Impact of non-underlying items on continuing profit after tax
(20.0)
(8.9)
Non-underlying discontinued operations after tax (note 5)
(31.4)
(0.5)
Impact of non-underlying items on profit after tax
(51.4)
(9.4)
Underlying profit after tax
56.8
56.8
Statutory profit after tax
5.4
47.4
The APMs used may not be comparable across companies. The impact of non-underlying items on statutory basic and diluted EPS, as well as a reconciliation to
the IFRS equivalent, is presented in note 10. The impact of non-underlying items on cash generated from operating activities, as well as a reconciliation to the
IFRS equivalent, is presented in note 30. The cash impact of non-underlying items includes the impact of exceptional items from prior years where the income
statement and cash flow timings differ. Non-underlying items are defined in the accounting policies on page 171.
DERIVATIVE FINANCIAL INSTRUMENTS
Included in non-underlying items is a £1.4m gain (2022: £4.1m loss) on the movement in fair value of derivative financial instruments. This is excluded from
underlying earnings to ensure the recognition of the gain or loss on the derivative matches the timing of the underlying transaction.
ACQUISITION EXPENSES
Included in non-underlying items is £3.7m (2022: £2.0m) of acquisition related expenses. This includes £3.4m (2022: £1.0m) relating to deferred consideration
contingent on continued employment of the former owners of Geollect and Cubica, which has been accounted for as equity-settled share-based payments
under IFRS 2 Share-based payments. We have classified this cost as a non-underlying item as it is a non-recurring cost relating to acquisitions. See note 28 for
further details. The remaining expense of £0.3m (2022: £1.0m) primarily includes professional fees incurred in relation to the Group’s mergers and acquisitions
activity during the year. The acquisition related expenses are not reflective of the underlying costs of the Group and therefore, in order to provide an
explanation of results that is not distorted by the costs of acquiring a business rather than organically developed, these costs have been excluded from the
underlying measures.
IMPAIRMENT OF CHEMICAL DETECTION ASSETS
Included in non-underlying items is £18.5m (2022: £nil) of non-cash impairment expenses, of which £15.6m relates to capitalised development costs and £2.9m
relates to other assets. After having undertaken a wider strategic review of the US Sensors business we have concluded that the prospect of securing a Program
of Record in the Chemical Detection part of the business is no longer probable and therefore we have chosen to record a non-cash impairment of development
costs (see note 12) and other related assets in our Chemical Detection line of business. The impairment expenses are not reflective of the underlying costs of the
Group and therefore, in order to provide an explanation of results that is not distorted by non-recurring asset impairments, these costs have been excluded
from the underlying measures.
LEGAL AND DISPOSAL PROVISIONS
£3.2m of provisions, where the original charge was treated as exceptional, were released in the year as the risk of economic outflow is no longer considered
probable. Other legal and disposal provisions, which were originally treated as exceptional, were increased by £3.2m in the year as the value of liabilities was
reassessed. Details are contained in note 23.
AMORTISATION OF ACQUIRED INTANGIBLES
Included in non-underlying items is the amortisation charge arising from business combinations of £3.0m (2022: £3.9m). Amortisation of acquired intangibles
arising from business combinations is associated with acquisition accounting under IFRS 3 Business Combinations. IFRS requires intangibles to be recognised on
acquisition that would not have been capitalised had the business grown organically under Chemring’s ownership. As such, these costs are not reflective of the
underlying costs of the Group and therefore, in order to provide an explanation of results that is not distorted by the history of business units being acquired
rather than organically developed, have been excluded from the underlying measures.
Chemring Group PLC Annual report and accounts 2023134

3. ALTERNATIVE PERFORMANCE MEASURES continued
TA X
The tax impact of non-underlying items comprises a £3.8m tax credit (2022: £1.1m credit) on the above non-underlying items.
We present the underlying effective tax rate for the Group, excluding non-underlying items, that is comparable over time. This is the taxation expense for
the Group, excluding any non-underlying tax charge or credit, as a percentage of underlying profit before taxation.
NET DEBT
A reconciliation and analysis of net debt is presented in notes 31 and 32. This APM allows management to monitor the indebtedness of the Group.
DISCONTINUED OPERATIONS
Further details on the results of discontinued operations are presented in note 5.
EBITDA
In our financial review we present measures of EBITDA, which is calculated as follows:
2023
2022
£m
£m
Operating profit
45.4
49.4
Amortisation arising from business combinations (note 12)
3.0
3.9
Amortisation of development costs (note 12)
0.7
0.1
Amortisation of patents and licences (note 12)
—
0.1
Depreciation of property, plant and equipment (note 13)
18.6
17.7
EBITDA
67.7
71.2
Non-underlying items
20.8
6.1
Underlying EBITDA
88.5
77.3
CONSTANT CURRENCY REVENUE AND OPERATING PROFIT
In our financial review we present a measure of constant currency revenue and operating profit. This is calculated by translating our results for the year ended
31 October 2023 at the average exchange rates for the comparative year ended 31 October 2022.
CASH CONVERSION
In our financial review we present a measure of cash conversion. This is calculated as underlying operating cash as a ratio of underlying EBITDA for the
stated period. Comparative period values for years prior to the year ended 31 October 2022 can be found on page 179 in the five-year record of financials.
4. OPERATING PROFIT
Operating profit is stated after charging/(crediting):
2023
2022
£m
£m
Research and development costs
– internally-funded
10.1
7.5
Amortisation
– arising from business combinations
3.0
3.9
– development costs
0.7
0.1
– patents and licences
—
0.1
Depreciation of property, plant and equipment
– owned assets
17.2
16.5
– leased assets
1.4
1.2
Impairment of development costs
15.6
2.2
Profit on disposal of non-current assets
—
(1.9)
Government grant income
(0.1)
—
Foreign exchange losses
2.7
2.0
Staff costs (note 6)
176.6
165.5
Cost of inventories recognised as an expense
146.5
124.3
The remaining items within operating profit predominantly relate to general and administrative expenses and production overheads, and include £nil (2022: £4.8m)
of other income.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 135

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
4. OPERATING PROFIT continued
A detailed analysis of the auditor’s remuneration on a worldwide basis is set out below:
2023
2022
Auditor’s remuneration
£m
£m
– the audit of the Company’s annual accounts
0.4
0.4
– the audit of the Company’s subsidiaries, pursuant to legislation
0.7
0.7
1.1
1.1
Audit-related assurance services
0.1
0.1
1.2
1.2
Included in the fees for the audit of the Company’s annual accounts is £0.1m (2022: £0.1m) in respect of the parent company. A description of the work of
the Audit Committee is set out in the Audit Committee report on pages 94 to 97, and includes an explanation of how auditor objectivity and independence
is safeguarded when non-audit services are provided by the auditor. No services were provided by the auditor pursuant to contingent fee arrangements.
5. RESULTS FROM DISCONTINUED OPERATIONS
Following the US DoD’s decision in 2022 to transition the HMDS Program of Record to sustainment earlier than they had previously indicated, we evaluated the
potential sustainment program and determined that in the short to medium term there is insufficient DoD funding to make it economically viable for Chemring
to continue to operate the business. The decision has therefore been taken that the explosive hazard detection (“EHD”) business will not continue to operate
and it has therefore been treated as a discontinued operation in 2023. Prior to the decision to discontinue the EHD business, it was presented as part of the
Sensors & Information segment.
2023
2022
£m
£m
Revenue
9.3
41.8
Underlying operating (loss)/profit from discontinued operations
(1.2)
4.6
Tax on underlying operating (loss)/profit from discontinued operations
0.3
(1.1)
Underlying (loss)/profit after tax from discontinued operations
(0.9)
3.5
Before non-underlying items
(0.9)
3.5
Non-underlying items
(33.6)
(0.7)
Tax on non-underlying items
2.2
0.2
(31.4)
(0.5)
(Loss)/profit for the year for discontinued operations
(32.3)
3.0
In 2023 the non-underlying items include a non-cash impairment of £31.2m (of which £20.5m relates to the goodwill associated with the acquisition of the
EHD business in 2009 and £10.7m relates to other assets), site rationalisation costs of £1.7m and the amortisation of acquired intangibles of £0.7m. Amortisation
of acquired intangibles arising from business combinations is associated with acquisition costs under IFRS 3 Business Combinations. As such, these costs are not
reflective of the underlying activities of the discontinued operations and therefore have been treated as non-underlying items. The impairment expenses and site
rationalisation costs are not reflective of the underlying costs of the Group and therefore, in order to provide an explanation of results that is not distorted by
non-recurring asset impairments or expenses, these costs have been excluded from the underlying measures.
In 2022 the non-underlying items were the amortisation of acquired intangibles of £0.7m.
The cash flows from discontinued operations are presented in note 30 .
Chemring Group PLC Annual report and accounts 2023136

5. RESULTS FROM DISCONTINUED OPERATIONS continued
The comparative income statement and cash flow information has been re-presented on the basis of the classification of operations as discontinued:
Underlying
Non-underlying
Revenue
442.8
(41.8)
401.0
—
—
—
Operating profit
64.0
(4.6)
59.4
(10.7)
0.7
(10.0)
Finance expense
(1.5)
—
(1.5)
—
—
—
Profit before tax
62.5
(4.6)
57.9
(10.7)
0.7
(10.0)
Taxation
(5.7)
1.1
(4.6)
1.3
(0.2)
1.1
Profit after tax
56.8
(3.5)
53.3
(9.4)
0.5
(8.9)
Profit after tax
—
3.5
3.5
—
(0.5)
(0.5)
Total profit after tax
56.8
—
56.8
(9.4)
—
(9.4)
CONSOLIDATED CASH FLOW STATEMENT
Cash flows from operating activities
90.1
(5.0)
85.1
(1.1)
—
(1.1)
Cash flows from operating activities
—
5.0
5.0
—
—
—
Total cash flows from operating activities
90.1
—
90.1
(1.1)
—
(1.1)
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 137

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
6. STAFF COSTS
The average monthly number of employees, including executive directors, was:
2023
2022
Number
Number
Direct
1,610
1,394
Indirect
931
899
Continuing operations
2,541
2,293
Discontinued operations
37
41
2,578
2,334
The costs incurred in respect of employees from continuing operations, including share-based payments, were:
2023
2022
£m
£m
Wages and salaries
148.8
138.0
Social security costs
15.0
14.0
Other pension costs
8.4
7.1
Share-based payment charge
4.4
6.4
Staff costs
176.6
165.5
The share-based payment charge of £4.4m (2022: £6.4m) excludes £3.4m (2022: £1.0m) of deferred consideration in relation to acquisitions accounted for as
equity-settled share-based payments. These amounts are included in non-underlying costs, see notes 3 and 27 for details.
7. FINANCE EXPENSE
2023
2022
£m
£m
Bank overdraft and loan interest
2.9
1.6
Amortisation of debt finance costs
0.4
0.3
Interest cost on retirement benefit obligations (note 29)
0.6
0.1
Lease liability interest
0.2
0.1
4.1
2.1
Amount capitalised
(2.8)
(0.6)
Finance expense
1.3
1.5
The capitalisation rate used to determine the amount of borrowing costs to be capitalised is the weighted average interest rate applicable to the entity’s
general borrowings during the year, in this case 5.7% (2022: 1.3%). During the year £2.8m (2022: £0.6m) of interest was capitalised in relation to the
Tennessee modernisation and automation programme and the investment in capacity expansion in the niche energetics businesses.
8. TAXATION
2023
2022
£m
£m
Current tax charge – current year
10.1
4.1
Current tax credit – prior year
(0.5)
(1.7)
Deferred tax (credit)/charge – current year (note 24)
(2.7)
0.7
Deferred tax (credit)/charge – prior year (note 24)
(0.5)
0.4
Tax charge
6.4
3.5
Income tax in the UK is calculated at 22.5% (2022: 19.0%) of the taxable profit for the year. Tax for other jurisdictions is calculated at the rates prevailing
in those jurisdictions.
Chemring Group PLC Annual report and accounts 2023138

8. TAXATION continued
The tax charge can be reconciled to the income statement as follows:
2023
2022
£m
£m
Profit before tax
44.1
47.9
Tax at the UK corporation tax rate of 22.5% (2022: 19.0%)
9.9
9.1
Expenses not deductible for tax purposes
0.5
0.1
Changes in tax rates
0.3
—
Tax losses/future interest deductions not previously recognised
(2.8)
(4.6)
Release of tax risk provision
(1.2)
(1.7)
Prior period adjustments
(1.0)
(1.3)
Overseas profits taxed at rates different to the UK standard rate
0.7
1.9
Tax charge for continuing operations
6.4
3.5
In addition to the tax charge in the income statement, a tax credit of £0.5m (2022: £0.4m) has been recognised in other comprehensive income in the year.
The effective rate of tax on the profit before tax of the Group is 14.5% (2022: 7.3%), and the effective rate of tax on the underlying profit before tax of the
Group is 15.0% (2022: 7.9%). The effective rate of tax on the underlying profit before tax is higher than the 2022 effective tax rate due to the recognition of
a deferred tax asset in respect of future US interest deductions in the prior year.
Included within the tax charge is a current year non-underlying deferred tax credit of £3.8m (2022: £1.1m), predominantly relating to the impairment of
Chemical Detection assets and tax on amortisation of acquired intangibles.
The UK Finance Bill 2021 was published on 11 March 2021 and substantively enacted on 24 May 2021. The bill provides for an increase in the rate of corporation
tax from 19% to 25% with effect from 1 April 2023, hence the UK effective rate of 22.5% in 2023. The Group underlying effective tax rate is expected to
increase in 2024 due to the full year impact of the increased UK tax rate.
FACTORS AFFECTING THE TAX CHARGE IN FUTURE YEARS
The Group’s future tax charge and effective tax rate could be affected by several factors including: tax reform in countries around the world, including any arising
from the implementation of the OECD’s BEPS actions and European Commission initiatives such as the proposed tax and financial reporting directive or as a
consequence of state aid investigations, future corporate acquisitions and disposals and any restructuring of our business.
9. DIVIDENDS
2023
2022
£m
£m
Dividends paid on ordinary shares of 1p each
Final dividend of 3.8p per share for the year ended 31 October 2022 (3.2p per share for the year ended 31 October 2021)
10.8
9.1
Interim dividend of 2.3p per share for the year ended 31 October 2023 (1.9p per share for the year ended 31 October 2022)
6.5
5.3
Total dividends
17.3
14.4
Subject to approval at the Annual General Meeting, the final dividend of 4.6p per ordinary share will be paid on 12 April 2024 to all shareholders registered at
the close of business on 22 March 2024. The estimated cash value of this dividend is £12.9m, although the final payment is likely to be lower as a result of the
impact of share buybacks. The total dividend for the year will therefore be 6.9p (2022: 5.7p) per ordinary share. As the final dividend is subject to approval by
the shareholders at the Annual General Meeting, it has not been included as a liability in the financial statements for the year ended 31 October 2023.
The cumulative preference shares carry an entitlement to a dividend at the rate of 7p per share per annum which was paid in equal instalments on 30 April 2023
and 31 October 2023.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 139

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
10. EARNINGS PER ORDINARY SHARE
Earnings per share is based on the average number of shares in issue, excluding own shares held, of 281,655,927 (2022: 280,506,245).
Diluted earnings per share has been calculated using a diluted average number of shares in issue, excluding own shares held, of 288,780,153 (2022: 288,218,004).
The number of shares used in the calculations is as follows:
2023
2022
Number
Number
millions
millions
Weighted average number of shares used to calculate basic earnings per share
281.7
280.5
Additional shares issuable other than at fair value in respect of options outstanding
7.1
7.7
Weighted average number of shares used to calculate diluted earnings per share
288.8
288.2
The earnings used in the calculations of the various measures of earnings per share are as follows:
2023
2022
Basic EPS
Diluted EPS
Basic EPS
Diluted EPS
£m
(Pence)
(Pence)
£m
(Pence)
(Pence)
Underlying profit after tax
57.7
20.5
20.0
53.3
19.0
18.5
Non-underlying items (note 3)
(20.0)
(8.9)
Profit from continuing operations
37.7
13.4
13.1
44.4
15.8
15.4
(Loss)/profit from discontinued operations
(32.3)
(11.5)
(11.2)
3.0
1.1
1.0
Total profit after tax
5.4
1.9
1.9
47.4
16.9
16.4
11. GOODWILL
At 1 November 2021
184.5
Foreign exchange adjustments
20.4
At 31 October 2022
204.9
Acquisitions through business combinations (note 28)
5.9
Foreign exchange adjustments
(6.5)
At 31 October 2023
204.3
At 1 November 2021
(75.8)
Foreign exchange adjustments
(11.0)
At 31 October 2022
(86.8)
Impairment
(20.5)
Foreign exchange adjustments
3.5
At 31 October 2023
(103.8)
At 31 October 2023
100.5
At 31 October 2022
118.1
Goodwill acquired in a business combination is allocated at acquisition to the cash-generating units (“CGUs”) that are expected to benefit from that business
combination. Cash-generating units have historically been represented by the individual operating companies within the operating segment descriptions on page
132. Over time, certain operating companies have evolved to focus on very distinct products or services, often linked to a particular program of record, which
amount to the generation of independent cash inflows. Accordingly, the directors have reassessed the definition of a CGU to be the division within an operating
company. In most of our operating companies, this has not led to a change in the CGUs identified as there is only one division, but it has for Chemring Sensors
& Electronic Systems, Inc. Following the transition of the EMBD Program of Record into full rate production and shipment of initial units to the customer at the
end of 2022, this business unit is split into three separate CGUs to reflect the independent cash flows being generated and the way in which management monitors
the business. The three CGUs being Explosive Hazard Detection (“EHD”), Biological Detection and Chemical Detection.
The goodwill that was previously allocated to Chemring Sensors & Electronic Systems, Inc. has been allocated across the three new CGUs on a relative value
basis. This goodwill relates to two separate acquisitions, one in the EHD line of business, all of which has been allocated to this CGU, and one which relates to
both the Biological Detection and Chemical Detection lines of business, which was allocated based on value in use.
Chemring Group PLC Annual report and accounts 2023140

11. GOODWILL continued
The Group tests goodwill at least annually for impairment. Tests are conducted more frequently if there are indications that goodwill might be impaired.
The recoverable amounts of the CGUs are determined from value-in-use calculations. The key assumptions for the value-in-use calculations have been
individually estimated for each CGU and include the discount rates and expected changes to cash flows during the period for which management has
detailed plans, which are underpinned by the winning and execution of key contracts. Based on our assessment, there is no reasonable possible change in
a key assumption which would result in the impairment of goodwill.
Management estimates discount rates using pre-tax rates that reflect current market assessments of the time value of money and the risks specific to each of the
CGUs. Pre-tax discount rates, derived from the Group’s post-tax weighted average cost of capital of 8.5% (2022: 7.2%) which have been adjusted for a premium
specific to each of the CGUs to account for differences in currency risk, country risk and other factors affecting specific CGUs, have been used to discount
projected cash flows. The premiums for 2023 were all 1% (2022: 1% to 2%).
Expected changes to cash flows during the period for which management has detailed plans relate to revenue forecasts, expected contract outcomes and
forecast operating margins in each of the operating companies based on our Board-approved five-year plan which considered past experience and our
understanding of customer budgets and priorities. The relative value ascribed to each varies between CGUs as the budgets are built up from the underlying
operating companies within each CGU. Changes in selling prices and direct costs are based on past practices and expectations of future changes.
At the end of five years, the calculations assume the performance of the CGUs will grow at a nominal annual rate of 2.25% (2022: 2.25%) in perpetuity. Growth
rates are based on management’s view of industry growth forecasts. The weighted average cost of capital is derived using beta values of a comparator group of
defence companies adjusted for funding structures as appropriate.
The pre-tax discount rates used for value-in-use calculations and the carrying value of goodwill by CGUs are:
2023
2022
2023
2022
%
%
£m
£m
Roke Manor Research Limited
12.9
11.2
37.4
31.5
Chemring Energetics UK Limited
12.9
10.2
14.6
14.6
Chemring Sensors & Electronic Systems, Inc.
N/A
10.5
N/A
40.8
Chemring Sensors & Electronic Systems, Inc. – Explosive Hazard Detection
11.8
n/a
—
n/a
Chemring Sensors & Electronic Systems, Inc. – Biological Detection
11.8
n/a
18.2
n/a
Chemring Sensors & Electronic Systems, Inc. – Chemical Detection
11.8
n/a
—
n/a
Chemring Energetic Devices, Inc.
11.8
10.5
17.1
18.0
Other
13.2
13.2
100.5
118.1
The goodwill arising from the acquisition of the Geollect Limited of £5.9m during the year ended 31 October 2023 was allocated to the Roke Manor Research
Limited CGU as it will form part of this operating company going forward (see note 28 for further details).
The pre-tax discount rates used for other CGUs ranged from 11.6% to 12.9% (2022: 10.2% to 12.3%).
The “Other” CGU is the carrying amount of goodwill that is allocated across multiple CGUs.
In the year ended 31 October 2023, a strategic review of the Group’s sensors business was conducted following the US DoD’s decision in 2022 to transition the
HMDS Program of Record to sustainment earlier than they had previously indicated; Chemring has now been able to evaluate the potential sustainment program
and determined that in the short to medium term there is insufficient US DoD funding to make it economically viable for Chemring to continue to operate the
business. The decision has therefore been taken that the EHD business will not continue to operate and it has therefore been treated as a discontinued
operation in 2023. A non-cash impairment, within discontinued operations, of the goodwill associated with the acquisition of the EHD business in 2009 totalling
£20.5m, has been recorded. The impairment has been recorded against the EHD CGU, with the value of the recoverable amount of the asset based on its value
in use.
Stress testing was performed on the forecasts to consider the impact of reasonably possible scenarios over the forecast period, including a 1.5% increase in
discount rate, a 1% reduction in long-term growth rate, a 10% fall in the forecast cash flows or a $0.10 weakening in the sterling to US dollar exchange rate.
Even under any of these circumstances, no CGUs would require an impairment against goodwill.
There are no reasonably possible changes in assumptions that would require an impairment against goodwill.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 141

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
12. DEVELOPMENT COSTS AND OTHER INTANGIBLE ASSETS
Acquired
Development
Acquired
customer
Patents and
costs
technology
relationships
licences
Total
£m
£m
£m
£m
£m
At 1 November 2021
55.6
91.5
48.8
0.5
140.8
Additions
2.5
0.4
—
—
0.4
Disposals
(0.4)
—
—
(0.3)
(0.3)
Foreign exchange adjustments
6.2
15.2
6.2
0.3
21.7
At 31 October 2022
63.9
107.1
55.0
0.5
162.6
Acquisitions through business combinations (note 28)
—
1.4
1.2
—
2.6
Additions
1.5
—
—
—
—
Disposals
—
—
—
—
—
Foreign exchange adjustments
(2.0)
(4.9)
(2.0)
—
(6.9)
At 31 October 2023
63.4
103.6
54.2
0.5
158.3
At 1 November 2021
(25.6)
(86.2)
(40.3)
(0.2)
(126.7)
Charge
(0.1)
(2.0)
(2.6)
(0.1)
(4.7)
Impairment
(2.2)
—
—
—
—
Disposals
0.3
—
—
0.3
0.3
Foreign exchange adjustments
(1.7)
(14.8)
(5.1)
(0.2)
(20.1)
At 31 October 2022
(29.3)
(103.0)
(48.0)
(0.2)
(151.2)
Charge
(0.7)
(1.6)
(2.1)
—
(3.7)
Impairment
(16.3)
(0.2)
—
—
(0.2)
Disposals
—
—
—
—
—
Foreign exchange adjustments
0.5
4.7
1.7
—
6.4
At 31 October 2023
(45.8)
(100.1)
(48.4)
(0.2)
(148.7)
At 31 October 2023
17.6
3.5
5.8
0.3
9.6
At 31 October 2022
34.6
4.1
7.0
0.3
11.4
Included within the development costs of £17.6m, individually material balances relate to Joint Biological Tactical Detection System of £9.2m (2022: £9.7m) and
Perceive of £5.5m (2022: £5.6m). Development costs are amortised over their useful economic lives, estimated to be between three and ten years, with the
remaining amortisation periods for these assets ranging up to ten years.
During the year ended 31 October 2023, the Group recognised an impairment of capitalised development costs of £15.6m having undertaken a wider strategic
review of the US Sensors business and concluding that the prospect of securing a Program of Record in the Chemical detection part of the business is no longer
probable. In addition, a further £0.7m impairment was recognised in relation to capitalised development costs associated with the EHD business that has been
treated as a discontinued operation in 2023.
Acquired intangibles are recognised at fair value on acquisition and are amortised over their estimated useful lives. Fair values for acquired intangibles are assessed
by reference to future estimated cash flows, discounted at an appropriate rate to present value, or by reference to the amount that would have been paid in an
arm’s length transaction between two knowledgeable and willing parties. Other intangible assets are recognised at cost and are amortised over their estimated
useful economic lives, which are set out in the accounting policies section.
Acquired technology of £3.5m includes individually material balances relating to Roke (including the Cubica Group and Geollect) of £3.1m (2022: £2.1m),
Chemring Energetic Devices of £0.4m (2022: £0.9m) and Chemring Sensors & Electronic Systems of £nil (2022: £1.0m). The remaining amortisation periods for
these assets are eight years and one year respectively.
Acquired customer relationships of £5.8m include individually material balances relating to Chemring Energetic Devices of £3.1m (2022: £4.6m), Roke (including
the Cubica Group and Geollect) of £2.7m (2022: £1.8m) and Chemring Sensors & Electronic Systems of £nil (2022: £0.6m). The remaining amortisation periods
for these assets are three years and eight years respectively.
During the year ended 31 October 2023, the Group recognised an impairment of acquired technology of £0.2m related to the Chemical Detection business.
Chemring Group PLC Annual report and accounts 2023142

13. PROPERTY, PLANT AND EQUIPMENT
Right-of-use
Right-of-use
Land and
Plant and
land and
plant and
buildings
equipment
buildings
equipment
Total
£m
£m
£m
£m
£m
At 31 October 2021
131.2
147.8
5.5
0.7
285.2
Reclassification
0.2
(0.3)
—
—
(0.1)
Additions
9.2
25.6
3.7
—
38.5
Disposals
(5.7)
(3.7)
(0.2)
—
(9.6)
Foreign exchange adjustments
10.4
13.4
1.1
—
24.9
At 31 October 2022
145.3
182.8
10.1
0.7
338.9
Reclassification
0.2
(0.2)
—
—
—
Additions
14.4
21.8
2.2
0.1
38.5
Disposals
(0.7)
(5.3)
(0.1)
—
(6.1)
Foreign exchange adjustments
(4.7)
(8.5)
(0.3)
—
(13.5)
At 31 October 2023
154.5
190.6
11.9
0.8
357.8
At 31 October 2021
(21.8)
(62.1)
(2.4)
(0.2)
(86.5)
Reclassification
0.3
(0.2)
—
—
0.1
Charge
(3.5)
(13.0)
(1.4)
(0.2)
(18.1)
Disposals
2.5
3.1
—
—
5.6
Foreign exchange adjustments
(2.4)
(5.7)
(0.6)
—
(8.7)
At 31 October 2022
(24.9)
(77.9)
(4.4)
(0.4)
(107.6)
Charge
(3.8)
(13.4)
(1.6)
(0.1)
(18.9)
Impairment
(0.1)
(0.2)
—
—
(0.3)
Disposals
0.7
5.3
0.1
—
6.1
Foreign exchange adjustments
1.2
3.7
0.2
—
5.1
At 31 October 2023
(26.9)
(82.5)
(5.7)
(0.5)
(115.6)
At 31 October 2023
127.6
108.1
6.2
0.3
242.2
At 31 October 2022
120.4
104.9
5.7
0.3
231.3
During the year, £2.8m (2022: £0.6m) of interest was capitalised, as set out in note 7. £1.0m (2022: £0.8m) of capitalised interest was charged as depreciation
and £nil (2022: £nil) was disposed of. This results in a net book value for capitalised interest of £10.6m (2022: £8.8m).
During the year ended 31 October 2023, the Group recognised an impairment of property, plant and equipment of £0.3m in relation to assets associated with
the EHD division of the US Sensors business which has been treated as a discontinued operation in 2023. See note 5 for further details.
Included within land and buildings and plant and equipment are assets under construction of £28.6m and £30.6m respectively (2022: £13.6m and £11.5m).
These assets are not depreciated.
Land and buildings were revalued at 30 September 1997 by Chestertons Chartered Surveyors, independent valuers not connected with the Group, on the basis
of depreciated replacement cost for two pyrotechnic sites and on open market for the remainder, which represent Level 2 measurements in the fair value hierarchy.
2023
2022
£m
£m
30 September 1997 depreciated replacement cost
4.0
4.0
Freehold at cost
150.5
141.3
Cost of land and buildings as at 31 October
154.5
145.3
If stated under historical cost principles, the comparable amounts for the total of land and buildings would be:
2023
2022
£m
£m
Cost
153.8
144.5
Accumulated depreciation
(27.1)
(25.2)
Historical cost value
126.7
119.3
All other tangible fixed assets are stated at historical cost.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 143

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
13. PROPERTY, PLANT AND EQUIPMENT continued
At 31 October 2023, the Group had entered into contractual commitments for the acquisition of property, plant and equipment amounting to £27.9m (2022: £6.9m).
Cash flows from purchases of property, plant and equipment are £32.7m (2022: £31.5m). The difference to the additions total presented above includes £2.3m
(2022: £3.8m) non-cash movements related to right-of-use assets as well as the movement in accrued capital expenditure.
14. SUBSIDIARY UNDERTAKINGS
All subsidiary undertakings have been reflected in these financial statements. The subsidiary undertakings held at 31 October 2023, which have a single class
of ordinary shares all 100% owned by the Group, are shown below. All of these subsidiary undertakings are wholly controlled by Chemring Group PLC, unless
otherwise stated.
(or registration) and operation
Operating segment
Chemring Australia Pty Limited
Australia
Countermeasures & Energetics
B.D.L. Systems Limited
England
Dormant
Chemring Countermeasures Limited*
England
Countermeasures & Energetics
Chemring Energetics Limited*
England
Dormant
Chemring North America Unlimited
England
Dormant
Chemring Prime Contracts Limited*
England
Dormant
Chemring Technology Solutions Limited*
England
Countermeasures & Energetics
Chemring Holdings Limited* (formerly CHG Overseas Limited)
England
Holding company
Cubica Technology Limited*
England
Dormant
Geollect Limited*
England
Sensors & Information
Greys Exports Limited
England
Dormant
Q6 Holdings Limited*
England
Dormant
Richmond Electronics & Engineering Limited
England
Dormant
Roke Manor Research Limited
England
Sensors & Information
Vigil AI Limited**
England
Sensors & Information
Chemring Nobel AS
Norway
Countermeasures & Energetics
Chemring Energetics UK Limited
Scotland
Countermeasures & Energetics
Alloy Surfaces Company, Inc.
US
Countermeasures & Energetics
ASC Realty LLC
US
Property holding company
Chemring Energetic Devices, Inc.
US
Countermeasures & Energetics
Chemring North America Group, Inc.
US
Holding company
Chemring Sensors & Electronic Systems, Inc.
US
Sensors & Information
CHG Flares, Inc.
US
Holding company
CHG Group, Inc.
US
Holding company
Geollect LLC
US
Sensors & Information
Kilgore Flares Company LLC
US
Countermeasures & Energetics
Roke USA, Inc.
US
Sensors & Information
Tactical Systems and Ordnance, Inc.
US
Non-trading
* Shares directly held by Chemring Group PLC.
** 80% indirectly owned by Chemring Group PLC.
Chemring Holdings Limited (company number 02731691), Chemring Technology Solutions Limited (company number 01528540) and Geollect Limited
(company number 10584604) are exempt from the requirement to file audited accounts for the year ended 31 October 2023 by virtue of section 479A
of the Companies Act 2006. See page 180 for the registered offices of the subsidiary undertakings.
Chemring Group PLC Annual report and accounts 2023144

15. INVENTORIES
2023
2022
£m
£m
Raw materials
49.6
48.1
Work in progress
33.1
38.8
Finished goods
19.0
12.7
101.7
99.6
There are no significant differences between the replacement cost of inventory and the carrying amount shown above. The Group recognised £0.3m (2022: £0.7m)
as a write down of inventories to net realisable value. See note 4 for details of cost of inventories recognised as an expense.
16. TRADE AND OTHER RECEIVABLES
2023
2022
£m
£m
Trade receivables
41.5
33.8
Allowance for doubtful debts
(0.2)
(0.5)
41.3
33.3
Advance payments to suppliers
2.3
1.7
Other receivables
10.7
8.5
Prepayments
6.9
6.2
Accrued income
13.6
11.4
74.8
61.1
All amounts shown above are due within one year.
The average credit period taken by customers on sales of goods, calculated using a countback basis, is 16 days (2022: 17 days). No interest is charged
on receivables from the date of invoice to payment.
Given the Group’s customer base, expected credit losses are typically not material; however, if there is any doubt over recoverability, the Group’s policy is to
provide in full for trade receivables outstanding for more than 120 days beyond agreed terms. As at 31 October 2023, £0.5m of gross trade receivables were
aged greater than 30 days past due (2022: £0.1m).
The directors consider that the carrying amount of trade and other receivables approximates to their fair values.
Of the £11.4m of accrued income at 31 October 2022, £11.4m had been billed and paid in the year. Of the £13.6m of accrued income at 31 October 2023,
over half was billed in the month after the reporting date. The remainder relates to the completion of performance obligations which will be billed at the
next contractual milestone, which is expected within the next year.
Of the £10.7m (2022: £8.5m) of other receivables at 31 October 2023, £nil (2022: £2.0m) related to a short-term loan due from the Chemring Group Staff
Pension Scheme to fund margin calls on liability driven investments, which was repaid in November 2022, and £8.9m (2022: £4.8m) related to research and
development expenditure credits receivable.
17. CASH AND CASH EQUIVALENTS
Bank balances and cash comprise cash held by the Group and short-term deposits with an original maturity of three months or less. The carrying amount
of these assets approximates to their fair value. For the purposes of the statement of cash flows, cash and cash equivalents comprises cash at bank of £6.4m
(2022: £19.8m).
18. BORROWINGS
2023
2022
£m
£m
Bank borrowings
14.1
20.9
Preference shares
0.1
0.1
Borrowings due after more than one year
14.2
21.0
Total borrowings
14.2
21.0
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 145

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
18. BORROWINGS continued
Analysis of borrowings by currency:
2023
2022
£m
£m
Sterling
14.2
0.1
US dollar
—
20.9
14.2
21.0
The weighted average interest rates paid were as follows:
2023
2022
%
%
Bank overdrafts
5.4
2.3
UK bank loans
– Sterling denominated
5.7
2.3
– US dollar denominated
1.4
1.4
An analysis of borrowings by maturity is as follows:
2023
2022
Bank
Bank
loans and
Preference
loans and
Preference
overdrafts
shares
To t a l
overdrafts
shares
Total
£m
£m
£m
£m
£m
£m
– within one to two years
—
—
—
—
—
—
– within two to five years
14.1
—
14.1
20.9
—
20.9
– after five years
—
0.1
0.1
—
0.1
0.1
14.1
0.1
14.2
20.9
0.1
21.0
Total borrowings
14.1
0.1
14.2
20.9
0.1
21.0
The Group’s principal debt facilities comprise a £150m revolving credit facility up to December 2025 of which £130m has been extended to December 2026,
as well as a US$10m overdraft, in November 2023 the overdraft was increased to US$20m. These were established in July 2021 with a syndicate of six banks and
there is one option to extend for one year to December 2027. None of the borrowings in the current or the prior year were secured.
There have been no breaches of the terms of the loan agreements during the current or prior year.
The Group has the following undrawn borrowing facilities available, in respect of which all conditions precedent have been met. Interest costs under these
facilities are charged at floating rates.
2023
2022
£m
£m
Undrawn borrowing facilities
142.9
136.7
The Group is subject to two key financial covenants, which are tested quarterly. These covenants relate to the leverage ratio between “underlying EBITDA”
and net debt, and the interest cover ratio between underlying EBITDA and finance costs. The calculation of these ratios involves the translation of non-sterling
denominated debt using average, rather than closing, rates of exchange and includes liabilities on foreign exchange forward contracts within its definition of net
debt. Therefore the leverage ratio of 0.21 times differs to the ratio of 0.16 times that is disclosed elsewhere in the annual report and accounts, which is calculated
using the closing rates of exchange and does not include liabilities on foreign exchange forward contracts within its definition of net debt. The Group was in compliance
with the covenants throughout the year. The year-end leverage ratio was 0.21 times (covenant limit of 3 times) and the year-end interest cover ratio was 30.01
times (covenant floor of 4 times).
19. LEASES
The carrying amount, additions and depreciation charge for right-of-use assets by class of underlying asset is included in note 13.
The expense relating to short-term and low-value leases in the year was £1.3m (2022: £0.9m). In total, payments of £1.8m (2022: £2.2m) were made
under leasing contracts. Included in the financing activities section of the cash flow is £1.6m (2022: £2.1m) to repay the principal portion of the lease and
£0.2m (2022: £0.1m) to repay lease interest. Included in the operating activities section of the cash flow is £1.3m (2022: £0.9m) relating to short-term and
low-value leases.
Chemring Group PLC Annual report and accounts 2023146

19. LEASES continued
A maturity analysis of the future undiscounted lease payments in respect of the Group’s lease liabilities is presented in the table below:
2023
2022
£m
£m
– within one year
1.1
1.8
– within one to two years
0.8
0.8
– within two to five years
1.9
1.4
– more than five years
3.0
2.1
5.7
4.3
Impact of discounting
(0.2)
(0.1)
Lease liabilities included in balance sheet as at 31 October
6.6
6.0
20. TRADE AND OTHER PAYABLES
2023
2022
£m
£m
Trade payables
16.3
14.7
Other payables
32.8
28.5
Interest payable
—
0.1
Other tax and social security
6.4
6.8
Advance receipts from customers
47.2
26.6
Accruals
15.3
17.6
Deferred income
6.0
3.9
124.0
98.2
Other payables of £32.8m (2022: £28.5m) includes payroll-related creditors of £18.1m (2022: £18.0m).
Trade payables and accruals principally comprise amounts outstanding for trade purchases and ongoing costs.
Advance receipts from customers represent the obligation to transfer goods or services to a customer for which consideration has been received. The amount
of £26.6m included in advance receipts from customers recognised at 31 October 2022 has been recognised as revenue in 2023 (2022: £17.1m). Of the £47.2m
of advanced receipts from customers at 31 October 2023, £24.4m is relevant to goods and services that will be delivered and provided within a year. No revenue
was recognised in 2023 from performance obligations satisfied in previous years.
The average credit period taken on purchases of goods is 18 days (2022: 18 days) using year-end trade payables divided by cost of sales. No interest is payable
on trade payables from the date of invoice to payment.
21. FINANCIAL RISK MANAGEMENT
The Group uses financial instruments to manage financial risk wherever it is appropriate to do so. The main risks addressed by financial instruments are liquidity
risk, foreign currency risk, interest rate risk and credit risk. The Group’s policies in respect of the management of these risks, which remained unchanged
throughout the year, are set out below.
(A) CREDIT RISK
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises
principally from the Group’s receivables from customers.
The impairment provisions for financial assets disclosed in note 16 “Trade and other receivables” are based on assumptions about risk of default and expected
loss rates. The Group uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Group’s past history
and existing market conditions, as well as forward-looking estimates at the end of each reporting period. Customers are mainly multinational organisations or
government agencies with which the Group has long-term business relationships. The Group’s principal customers are government defence departments, such as
the US Department of Defense (“US DoD”) and the UK Ministry of Defence (“UK MOD”), US and UK defence prime contractors, such as BAE Systems and
General Dynamics, and distributors of products for their onward sale to end users.
The majority of revenue in 2023 related to the US DoD, the UK MOD and the US and UK defence prime contractors, which consistently pay within terms and
are deemed low credit risk as a result. For all other customers the Group’s policy is to trade under a letter of credit. If there is any doubt over recoverability, the
Group’s policy is to provide in full for trade receivables outstanding for more than 120 days beyond agreed terms. The balances which might be affected by credit
risk are trade receivables, accrued income and cash and cash equivalents.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 147

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
21. FINANCIAL RISK MANAGEMENT continued
(B) CAPITAL MANAGEMENT
The Group manages its capital to ensure that all entities in the Group will be able to continue as a going concern while meeting the returns to stakeholders.
The capital structure of the Group consists of equity (as disclosed in the consolidated statement of changes in equity), retained earnings, cash and cash equivalents
(note 17) and a revolving credit facility (“RCF”) (note 18). The Group seeks to manage its capital through an appropriate mix of these items. The Group’s
principal debt facilities comprise a £150m revolving credit facility up to December 2025 of which £130m has been extended to December 2026, as well as a
US$10m overdraft, in November 2023 the overdraft was increased to US$20m. These were established in July 2021 with a syndicate of six banks and there is one
option to extend for one year to December 2027. As at 31 October 2023, the RCF was drawn by £15.1m (2022: £21.7m).
(C) FINANCIAL RISK MANAGEMENT
The primary risks that the Group is exposed to are liquidity risk, foreign currency risk, interest rate risk and credit risk. It is the Group’s policy to manage these
risks under the following policies:
i. Liquidity risk management
Liquidity risk is the risk that the Group does not have sufficient financial resources to meet its obligations as they fall due. The Group manages liquidity risk by
maintaining adequate reserves and by continually monitoring forecast and actual cash flows. The Group’s policy is to maintain continuity of funding through
available cash and cash equivalents and the RCF.
ii. Foreign currency risk management
The Group’s presentational currency is sterling. The Group is subject to exposure on the translation of the assets of foreign subsidiaries, whose functional
currencies differ from the Group. The Group’s primary balance sheet translation exposures are to the US dollar, Australian dollar and Norwegian krone.
The Group minimises the balance sheet translation exposures, where it is practical to do so, by funding subsidiaries with long-term loans, on which exchange
differences are taken to reserves. US dollar borrowings held by the Group are treated as a net investment hedge against the US dollar assets of the Group.
The Group faces currency exposures arising from the translation of profits earned in foreign currency. These exposures are not hedged. Exposures also arise
from foreign currency denominated trading transactions undertaken by subsidiaries’ deemed transactional exposures. The Group’s policy is to hedge transactional
exposures above £250,000 in the banking market on a one-to-one basis using forward contracts. Below £250,000, the exposures are netted across subsidiaries
and any surplus or deficit hedged in the banking market using spot or forward contracts. The Group’s policy is that there is no speculative trading in financial
instruments. During the year ended 31 October 2023, there were no options or structured derivatives utilised.
iii. Interest rate risk management
The Group finances its operations through a combination of retained profits and bank borrowings. The UK borrowings are denominated in sterling
and US dollars, and at the shorter end are subject to floating rates of interest.
IFRS 9 FINANCIAL INSTRUMENTS
Chemring Group PLC is not a financial institution and does not have any complex financial instruments. The Group does not apply hedge accounting to
derivatives and the Group’s customers are generally governments that are considered creditworthy and pay consistently within agreed payment terms.
2023
2022
Carrying value
Fair value
Carrying value
Fair value
£m
£m
£m
£m
Trade receivables
41.3
41.3
33.3
33.3
Accrued income
13.6
13.6
11.4
11.4
Cash and cash equivalents
6.4
6.4
19.8
19.8
Derivative financial instruments
0.8
0.8
0.7
0.7
Derivative financial instruments
(3.5)
(3.5)
(5.3)
(5.3)
Trade payables
(16.3)
(16.3)
(14.7)
(14.7)
Other payables
(32.8)
(32.8)
(28.5)
(28.5)
Interest payable
—
—
(0.1)
(0.1)
Borrowings
(14.2)
(14.2)
(21.0)
(21.0)
The following items are not financial instruments as defined by IFRS 9:
(a) prepayments made/advances received (right to receive future goods or services, not cash or a financial asset);
(b) tax receivables and payables and similar items (statutory rights and obligations, not contractual); or
(c) deferred revenue and warranty obligations (obligations to deliver goods and services, not cash or financial assets).
Chemring Group PLC Annual report and accounts 2023148

22. FINANCIAL INSTRUMENTS
The following table details the fair value of derivative financial instrument assets/(liabilities) recognised in the balance sheet:
2023
2022
£m
£m
Included in current assets
0.8
0.7
Included in current liabilities
(3.2)
(4.2)
(2.4)
(3.5)
Included in non-current liabilities
(0.3)
(1.1)
Forward foreign exchange contracts
(2.7)
(4.6)
There was a £1.4m gain (2022: £4.1m loss) on the movement in the fair value of derivative financial instruments recognised in the income statement.
The table below details the remaining contractual maturities of the Group’s derivative financial instruments and loans at the reporting date. The amounts are
gross and undiscounted and include interest payments estimated based on the conditions existing at the reporting date.
2023
2022
Derivative
Loans and
Derivative
Loans and
instruments
overdrafts
To t a l
instruments
overdrafts
Total
£m
£m
£m
£m
£m
£m
– within one year
(2.4)
—
(2.4)
(3.5)
(0.3)
(3.8)
– within one to two years
(0.3)
—
(0.3)
(1.1)
(0.3)
(1.4)
– within two to five years
—
(14.2)
(14.2)
—
(21.3)
(21.3)
(2.7)
(14.2)
(16.9)
(4.6)
(21.9)
(26.5)
A maturity analysis of the contracted cash outflows on lease liabilities is provided in note 19.
FAIR VALUE HIERARCHY
IFRS 7 Financial Instruments: Disclosures requires companies that carry financial instruments at fair value in the balance sheet to disclose their level of hierarchy,
determining into which category those financial instruments fall under the fair value hierarchy.
The fair value measurement hierarchy is as follows:
- Level 1 – quoted prices (unadjusted) in active markets for identical assets or liabilities;
- Level 2 – inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly
(i.e. derived from prices); and
- Level 3 – inputs for the asset or liability that are not based on observable market data (i.e. as unobservable inputs).
The following tables present the Group’s assets and liabilities that are measured at fair value:
2023
2022
Carrying
Carrying
Fair value
amount
Fair value
amount
Fair value
hierarchy
£m
£m
£m
£m
Derivative financial instruments – assets
Level 2
0.8
0.8
0.7
0.7
Derivative financial instruments – liabilities
Level 2
(3.5)
(3.5)
(5.3)
(5.3)
(2.7)
(2.7)
(4.6)
(4.6)
The fair value of derivative financial instruments is estimated by discounting the future contracted cash flow, using readily available market data.
SENSITIVITY ANALYSIS
For the year ended 31 October 2023 the closing exchange rate for the US dollar was 1.21 (2022: 1.15), AU dollar was 1.92 (2022: 1.80) and Norwegian krone
was 13.56 (2022: 11.97). The average exchange rates were 1.24 (2022: 1.23), 1.91 (2022: 1.75) and 13.10 (2022: 11.82) respectively.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 149

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
22. FINANCIAL INSTRUMENTS continued
SENSITIVITY ANALYSIS continued
The following table details the Group’s sensitivity to a 10% weakening or strengthening of sterling against the US dollar, AU dollar and Norwegian krone with
regards to its income statement. The Group considers a 10% strengthening or weakening of sterling as a reasonably possible change in foreign exchange rates.
10 per cent
10 per
weakening of sterling
strengthening of sterling
2023
2022
2023
2022
Continuing operations
£m
£m
£m
£m
Revenue
22.0
24.2
(19.7)
(16.5)
Underlying operating profit
3.3
2.9
(2.4)
(2.6)
Interest
—
—
—
—
Underlying profit before tax
3.3
2.9
(2.4)
(2.6)
As at 31 October 2023, 100% of the Group’s gross debt was at floating rates. The Group monitors its exposure to movements in interest rates, having regard
to prevailing market conditions, and considers the use of interest rate swaps on an ongoing basis to manage this exposure. The Group has not entered into any
interest rate swaps as of 31 October 2023.
Based on the closing debt value as at 31 October 2023, a change in interest rates of 1% throughout the year would cause the Group’s finance expense to change
by £0.2m.
23. PROVISIONS
Legal
Environmental
Disposal
Dilapidations
provision
provision
provision
provision
Total
£m
£m
£m
£m
£m
At 31 October 2022
3.5
3.9
11.0
—
18.4
Transfer from trade and other payables
—
—
—
0.2
0.2
Transfer between categories
—
—
(0.2)
0.2
—
Released
—
—
(3.2)
—
(3.2)
Provided
1.0
0.7
2.2
0.3
4.2
Foreign exchange adjustments
—
(0.2)
(0.2)
—
(0.4)
Paid
(0.5)
(0.9)
(0.2)
—
(1.6)
At 31 October 2023
4.0
3.5
9.4
0.7
17.6
These provisions are classified on the balance sheet as follows:
2023
2022
£m
£m
Included in current liabilities
5.6
1.6
Included in non-current liabilities
12.0
16.8
17.6
18.4
The legal provision represents the estimated legal liabilities faced by the Group at the balance sheet date. There are uncertainties regarding the range of possible
outcomes and timing of cash outflows, dependent on the outcome of court proceedings. Further details of the Group’s contingent liabilities are set out in note 33.
The environmental provision is held in respect of potential liabilities, associated with the Group’s facility in Chicago, US. The range of possible outcomes is
between £1.6m and £7.9m. There are uncertainties regarding the timing of cash outflows, dependent on the outcome of regulatory proceedings.
The disposal provision includes material balances relating to estimated liabilities faced by the Group in respect of the disposal of its European Munitions
businesses in 2014 under the terms of their respective sale agreements. The range of possible outcomes is between £nil and £17.1m, and the risk of economic
outflow relating to these reduces with the passage of time. These are expected to be utilised over the next five years.
The dilapidations provision represents the estimated liabilities costs that the Group estimates will be incurred upon vacating properties which are occupied
under rental agreements.
Provisions are subject to uncertainty in respect of the outcome of future events. Legal provisions will be utilised based on the outcome of cases and the level of
costs incurred defending the Group’s position. Environmental provisions will be utilised based on the outcome of further environmental studies and remediation
work. Disposal provisions will be utilised based on the outcome of certain events which are specified in sale and purchase agreements. It is not possible to
estimate more accurately the expected timing of any resulting outflows of economic benefits.
Chemring Group PLC Annual report and accounts 2023150

24. DEFERRED TAX
The following are the principal deferred tax assets/(liabilities) recognised by the Group and movements thereon:
tax
US interest
Ta x
Acquired
depreciation
Pensions
deductions
losses
intangibles
Other
Total
£m
£m
£m
£m
£m
£m
£m
At 1 November 2021
(19.4)
(3.7)
3.8
5.6
(7.0)
8.2
(12.5)
(Charge)/credit to income
(11.5)
—
3.5
6.3
(0.6)
1.2
(1.1)
(Charge)/credit to other comprehensive income
(2.2)
0.8
0.8
1.0
(0.7)
1.0
0.7
Transfers
0.1
—
—
—
(0.1)
—
—
At 31 October 2022
(33.0)
(2.9)
8.1
12.9
(8.4)
10.4
(12.9)
(Charge)/credit to income
(1.3)
0.3
(0.2)
5.4
(0.3)
1.8
5.7
Credit/(charge) to other comprehensive income
1.0
1.6
(0.2)
(0.6)
0.2
(0.4)
1.6
Recognised on acquisition
—
—
—
—
(0.6)
—
(0.6)
Recognised directly in equity
—
—
—
—
—
(0.7)
(0.7)
At 31 October 2023
(33.3)
(1.0)
7.7
17.7
(9.1)
11.1
(6.9)
Deferred tax assets
—
—
7.7
17.7
—
11.5
36.9
Deferred tax liabilities
(33.3)
(1.0)
—
—
(9.1)
(0.4)
(43.8)
At 31 October 2023
(33.3)
(1.0)
7.7
17.7
(9.1)
11.1
(6.9)
Deferred tax assets
0.3
—
8.1
12.9
—
11.0
32.3
Deferred tax liabilities
(33.3)
(2.9)
—
—
(8.4)
(0.6)
(45.2)
At 31 October 2022
(33.0)
(2.9)
8.1
12.9
(8.4)
10.4
(12.9)
Certain deferred tax assets and liabilities have been offset in accordance with the Group’s accounting policy. Deferred tax balances after offset are analysed on
the balance sheet as per the table above.
Deferred tax balances of £11.1m (2022: £10.4m) within the “Other” category above include temporary differences arising on provisions and accruals.
At the balance sheet date, the Group had unrecognised deferred tax of £0.5m (2022: £3.7m) on gross tax losses of £8.3m (2022: £21.2m) and unrecognised
deferred tax of £19.7m (2022: £18.2m) on gross interest deductions of £73.7m (2022: £72.2m) as a result of US interest limitation regulations, potentially
available for offset against future profits in certain circumstances. The Group also had unrecognised deferred tax of £0.7m (2022: £1.5m) on gross capital
losses of £3.5m (2022: £6.9m). No deferred tax asset has been recognised in respect of these amounts because of the unpredictability of future taxable
qualifying profit streams. The aforementioned gross interest deductions are available indefinitely with no fixed expiry date, while the gross tax losses and
gross capital losses expire in 2031 and 2026 respectively.
The Group has not recognised any deferred tax liability on temporary differences relating to potentially taxable unremitted earnings of overseas subsidiaries
because the Group is in a position to control the timing of the reversal of the temporary differences and none are expected to reverse in the foreseeable future.
25. SHARE CAPITAL
2023
2022
£m
£m
280,842,610
(2022:
283,541,742) ordinary shares of 1p each
2.8
2.8
During the year, 495,671 ordinary shares (2022: 392,231) were issued for cash to employees under the Group’s approved savings-related share schemes.
The Company’s share capital also includes 62,500 7% cumulative preference shares of £1 each, which are all issued and fully paid up, and are classified
for accounting purposes within non-current liabilities. The cumulative preference shares carry an entitlement to a dividend at the rate of 7p per share per annum,
payable in equal instalments on 30 April and 31 October each year. Holders of the preference shares have the right on a winding-up to receive, in priority to any
other classes of shares, the sum of £1 per share together with any arrears of dividends.
On 1 August 2023, the Company announced the details of a share buyback programme to repurchase up to £50m of its own shares over the following 12
months. During 2023, 3,194,803 shares were repurchased for a total price, including transaction costs, of £9.0m. These shares were subsequently cancelled,
with the nominal value of shares cancelled deducted from share capital against the special capital reserve.
As at 31 October 2023, the Group had agreed to further share repurchases of £2.9m that were settled in cash subsequent to year end. The £2.9m is included as
a liability in trade and other payables (see note 20).
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 151

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
26. RESERVES
The share premium account, the special capital reserve and the revaluation reserve are not distributable.
The special capital reserve was created as part of a capital reduction scheme involving the cancellation of the share premium account which was approved
by the Court in 1986, in accordance with the requirements of the Companies Act 1985.
The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations and
the accumulation of gains or losses from the effective portion of hedges of net investments in foreign operations.
Included within retained earnings is £4.3m (2022: £7.3m) of the Company’s own shares held by the Group’s Employee Share Ownership Plan Trust (“ESOP”) which
is treated as a branch of the parent company. The ESOP purchased 1,652,072 shares during the year (2022: 2,467,329) and 2,734,163 shares (2022: 2,607,129)
were distributed following the vesting of awards under the deferred bonus and PSP schemes. The total number of ordinary shares held by the ESOP at
31 October 2023 was 1,361,618 (2022: 2,443,709).
On 1 August 2023, the Company announced the details of a share buyback programme to repurchase up to £50m of its own shares over the following 12 months.
See note 25 for further details.
Group dividends (note 9) are payable out of the parent company retained earnings as disclosed in the parent company financial statements. This provides cover
over the declared final dividend of 4.6p per ordinary share for the year ended 31 October 2023.
27. SHARE-BASED PAYMENTS
The Group operates share-based compensation arrangements to provide incentives to the Group’s senior management and eligible employees. The Group recognised
a net charge of £7.8m (2022: £7.4m) in respect of share-based payments during the year, of which £3.4m (2022: £1.0m) is included in non-underlying costs.
Details of the four schemes which operated during the year are set out below.
THE CHEMRING GROUP PERFORMANCE SHARE PLAN 2016 (THE “2016 PSP”)
Under the 2016 PSP, conditional awards of ordinary shares are made at nil cost to employees. Awards ordinarily vest on the third anniversary of the award date.
2016
PSP
2023
2022
Outstanding at the beginning of the year
5,987,329
6,218,961
Awarded
2,290,834
2,386,342
Vested
(2,015,696)
(2,374,231)
Lapsed
(709,187)
(243,743)
Outstanding at the end of the year
5,553,280
5,987,329
Subject to vesting at the end of the year
—
—
The following awards were outstanding at 31 October 2023:
ordinary
Vesting price
Date when
shares
per share
awards due
Date of award
under award
Pence
to vest
16 December 2020
1,513,830
nil
16 December 2023
15 December 2021
1,995,759
nil
15 December 2024
14 December 2022
2,043,691
nil
14 December 2025
The Group has applied a discount to the share-based payments to reflect the anticipated achievement of the stipulated targets for each 2016 PSP award based
on the predicted figures within the Group’s financial projections and the expected number of leavers over the life of the awards.
The 2016 PSP awards made in the year ended 31 October 2023 had targets based on earnings per share growth, total shareholder return and reduction in the
Group’s carbon emissions. The awards have been valued using the following modelling inputs. The total shareholder return element was valued using a
Monte-Carlo model. Expected volatility was determined by assessing the volatility in share price of the Group and its comparator group of companies over a
three-year period prior to the grant date.
14 December
15 December
16 December
2022
2021
2020
Share price at valuation
305p
284p
300p
Exercise price
nil
nil
nil
Risk-free rate
0.5%
0.5%
0.5%
Expected volatility
29.1%
29.1%
29.1%
Fair value
272.3p
232.9p
246.4p
The weighted average fair value of awards made during the year was 272.3p (2022: 232.9p).
In the year ended 31 October 2023 2,015,696 awards vested (2022: 2,374,231). The charge recognised in respect of the awards is based on their fair value at the
grant date.
Chemring Group PLC Annual report and accounts 2023152

27. SHARE-BASED PAYMENTS continued
THE CHEMRING GROUP 2018 UK SHARESAVE PLAN (THE “UK SHARESAVE PLAN”)
Options were granted during the year on 1 September 2023.
2023
2022
Weighted
Weighted
average
average
Number
exercise
Number
exercise
of share
price
of share
price
options
Pence
options
Pence
Outstanding at the beginning of the year
1,878,345
229.3
1,770,380
197.4
Granted
845,661
264.0
664,054
264.0
Exercised
(483,778)
193.5
(362,049)
153.4
Lapsed
(204,745)
240.5
(194,040)
198.3
Outstanding at the end of the year
2,035,483
236.1
1,878,345
229.3
Subject to exercise at the end of the year
145,218
201.7
5,056
178.0
The following options were outstanding at 31 October 2023:
of ordinary
Exercise price
shares under
per share
Dates between which
Date of award
award
Pence
options may be exercised
30 July 2018
1,685
178.0
1 October 2023–31 March 2024
29 July 2019
25,713
154.0
1 October 2024–31 March 2025
30 July 2020
143,533
202.0
1 October 2023–31 March 2024
30 July 2020
83,162
202.0
1 October 2025–31 March 2026
26 July 2021
330,735
240.0
1 October 2024–31 March 2025
26 July 2021
67,900
240.0
1 October 2026–31 March 2027
1 September 2022
453,765
264.0
1 October 2025–31 March 2026
1 September 2022
91,485
264.0
1 October 2027–31 March 2028
4 August 2023
723,601
228.0
1 October 2026–31 March 2027
4 August 2023
113,904
228.0
1 October 2028–31 March 2029
The weighted average fair value of options granted in the year was 57.0p (2022: 34.0p). The weighted average fair value of options exercised in the year was
38.9p (2022: 30.7p). The weighted average share price on exercise of the options during the year was 193.5p (2022: 153.4p).
The fair values of the share options in the UK Sharesave Plan are based on the difference between the exercise price and the share price on the grant date of
the option.
DEFERRED BONUS SHARE AWARDS
Under the deferred bonus share awards, deferred awards of ordinary shares are made at nil cost to employees. Awards ordinarily vest on the second or third
anniversary of the award date.
2023
2022
Outstanding at the beginning of the year
937,055
766,171
Awarded
320,288
456,232
Vested
(361,932)
(225,621)
Lapsed
(21,313)
(59,727)
Outstanding at the end of the year
874,098
937,055
Subject to vesting at the end of the year
—
—
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 153

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
27. SHARE-BASED PAYMENTS continued
DEFERRED BONUS SHARE AWARDS continued
The following awards were outstanding at 31 October 2023:
ordinary
Share price
Vesting price
Date when
shares
at valuation
per share
awards are due
Date of award
under award
Pence
Pence
to vest
15 December 2020
147,500
300p
nil
15 December 2023
14 December 2021
240,321
284p
nil
14 December 2023
14 December 2021
170,336
284p
nil
14 December 2024
13 December 2022
111,748
305p
nil
13 December 2024
13 December 2022
204,193
305p
nil
13 December 2025
The fair value of the deferred bonus share awards is based on the share price on the grant date of the award. The weighted average fair value of awards made
during the year was 305p (2022: 284p). The Group has applied a discount to the share-based payments to reflect the expected number of leavers over the life
of the awards.
DEFERRED SHARES RELATED TO ACQUISITION
Deferred consideration in relation to the acquisition of the “Cubica Group” of up to £2.0m and in relation to the acquisition of Geollect of up to £7.5m has been
accounted for as equity-settled share-based payments under IFRS 2. See note 28 for further detailed disclosure.
Cubica Group
The deferred consideration is comprised of two tranches of 326,792 Chemring ordinary shares each, valued at £2m based on the share price on 2 June 2021
of 307p. The first tranche vested on the second anniversary of completion, 2 June 2023, and the second tranche will vest on the third anniversary of completion,
2 June 2024, subject to continued employment with Chemring Group PLC.
No further awards were granted during the year ended 31 October 2023 (2022: nil) in respect of the Cubica Group acquisition. 326,792 vested (2022: nil) and
nil (2022: nil) lapsed in the year. 326,792 are outstanding at the end of the year (2022: 653,584). Nil were subject to vesting at the end of the year (2022: nil).
The fair value of the deferred share awards is based on the share price on the grant date of the award.
Geollect
The deferred consideration is comprised of two tranches of 1,233,552 Chemring ordinary shares each, valued at £7.5m based on the share price on 7 December
2022 of 298.5p. The first tranche will vest on the second anniversary of completion, 7 December 2024, and the second tranche will vest on the third anniversary
of completion, 7 December 2025, subject to continued employment with Chemring Group PLC.
A total of 2,467,104 awards were granted during the year ended 31 October 2023. Nil vested or lapsed in the year (2022: nil) and 2,467,104 are outstanding at
the end of the year (2022: nil). Nil were subject to vesting at the end of the year (2022: nil).
The fair value of the deferred share awards is based on the share price on the grant date of the award. The weighted average fair value of awards made during
the year was 298.5p.
28. ACQUISITION OF SUBSIDIARY
ACQUISITIONS IN THE YEAR ENDED 31 OCTOBER 2023
Acquisition of Geollect Limited
On 7 December 2022, Chemring Group PLC acquired 100% of the issued shares in Geollect Limited (“Geollect”). Geollect is an international provider of
geospatial intelligence consultancy and subscription services. The acquisition has strong synergies to Roke and will expand the Group’s existing capabilities and
product offerings. The operating results and assets and liabilities of the acquired company have been consolidated from 7 December 2022.
The acquisition was completed for an initial purchase consideration of £7.3m, funded from Chemring’s existing bank facilities.
Deferred consideration of up to £7.5m is payable in Chemring 1p ordinary shares in two tranches (subject to the former owners remaining employed in the
Chemring Group) on the second and third anniversary of completion. In accordance with IFRS 3 these costs will be treated as post-acquisition expenses and
accounted for as equity-settled share-based payments under IFRS 2. See note 3 for further details. Acquisition-related costs of £3.1m have been classified as non-
underlying costs in the statement of profit or loss in the year ended 31 October 2023, which includes £2.8m relating to share-based payments.
Since acquisition to 31 October 2023, Geollect contributed revenue of £1.2m and an adjusted operating profit of £0.1m to the Group’s results. If the acquisition
had occurred on 1 November 2022, we estimate that its revenue would have been £1.3m, and adjusted operating profit for the year would have been £0.1m. In
determining these amounts, we have assumed that the fair value adjustments, determined provisionally, that arose on the date of acquisition would have been the
same if the acquisition had occurred on 1 November 2022.
Chemring Group PLC Annual report and accounts 2023154

28. ACQUISITION OF SUBSIDIARY continued
ACQUISITIONS IN THE YEAR ENDED 31 OCTOBER 2023 continued
Acquisition of Geollect Limited continued
Details of the consideration transferred were:
Cash paid
7.2
Loans assumed
0.1
Total purchase consideration
7.3
The provisionally determined fair values of the assets and liabilities of Geollect Limited as at the date of acquisition were as follows:
Trade and other receivables
0.1
Trade and other payables
(0.6)
Loans
(0.1)
Intangible assets: customer relationships
1.2
Intangible assets: technology
1.4
Deferred tax liability
(0.6)
Net identifiable assets
1.4
Add: goodwill
5.9
Net assets acquired
7.3
Goodwill is attributable to the skills and technical talent of the assembled workforce and synergies expected to arise after the Group’s acquisition of the new
subsidiary. None of the goodwill is expected to be deductible for tax purposes. If new information obtained within one year of the date of acquisition about facts
and circumstances that existed at the date of acquisition identifies adjustments to the above amounts, or any additional provisions that existed at the date of
acquisition, then the accounting for the acquisition will be revised.
Acquisition of the Cubica Group
On 2 June 2021, Chemring Group PLC acquired 100% of the issued shares in Cubica Technology Limited (“Cubica”) and Q6 Holdings Limited (“Q6”), collectively
the “Cubica Group”. The acquisition completed for an initial cash consideration of £7.0m. Deferred consideration of up to £2.0m has been accounted for as
equity-settled share-based payments under IFRS 2, resulting in a charge of £0.6m (2022: £1.6m) in the income statement. This has been classified as non-underlying
costs; see note 3 and note 27 for more details.
29. RETIREMENT BENEFIT OBLIGATIONS
In the UK, the Group operates a defined benefit scheme (the “Chemring Group Staff Pension Scheme”). The Group’s other UK and overseas pension arrangements
are all defined contribution schemes, with a combined cost of £8.4m (2022: £7.3m) for continuing operations. Chemring Nobel operated a defined benefit
pension scheme that was closed in October 2022 and the liability transferred to an insurance company. The net deficit of the Chemring Nobel Scheme as at
31 October 2022 was £nil and as such was immaterial for disclosure in the prior year comparisons.
The Chemring Group Staff Pension Scheme is a funded scheme and the assets of the scheme are held in a separate trustee administered fund. The scheme
was closed to future accrual on 6 April 2012. A full actuarial valuation for the scheme as at 6 April 2021 has been updated to 31 October 2023, using the
projected unit credit method. The main assumptions for the scheme are detailed below. The surplus of the Chemring Group Staff Pension Scheme was £5.9m
at 31 October 2023 (2022: £11.2m).
Under the funding plan agreed with the trustees following the 2021 actuarial valuation, no further deficit recovery payments are required. The Company and the
trustees monitor funding levels annually, and a new funding plan is agreed with the trustees every three years, based on actuarial valuations.
The trust deed provides for an unconditional right to a return of surplus assets in the event of a plan wind-up. The trustees are given no rights to unilaterally wind up
or augment the benefits due to members of the scheme. Based on these rights, any net surplus in the UK scheme is recognised in full.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 155

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
29. RETIREMENT BENEFIT OBLIGATIONS continued
The movement in the net defined benefit asset is as follows:
Defined benefit obligations
Defined benefit asset
Net defined benefit asset
2023
2022
2023
2022
2023
2022
£m
£m
£m
£m
£m
£m
At 1 November
(60.2)
(90.9)
71.4
104.6
11.2
13.7
Administrative expenses
—
—
(1.1)
(0.3)
(1.1)
(0.3)
Net interest (cost)/credit
(3.0)
(1.6)
3.5
1.8
0.5
0.2
(3.0)
(1.6)
2.4
1.5
(0.6)
(0.1)
– demographic and financial assumptions
3.8
29.9
—
—
3.8
29.9
– experience adjustment
(0.4)
(1.8)
—
—
(0.4)
(1.8)
– return on plan assets excluding interest income
—
—
(8.1)
(30.4)
(8.1)
(30.4)
3.4
28.1
(8.1)
(30.4)
(4.7)
(2.3)
Other
Settlements
—
0.9
—
(1.0)
—
(0.1)
Net benefits paid out
3.5
3.3
(3.5)
(3.3)
—
—
At 31 October
(56.3)
(60.2)
62.2
71.4
5.9
11.2
The Chemring Group Staff Pension Scheme had 801 members at the end of the year (2022: 828). Of these members 59.8% (2022: 58.9%) were pensioners
drawing benefits from the scheme and the balance were deferred members. The duration of the liability is long, with pension payments expected to be made
for at least the next 40 years.
The pension scheme’s assets are analysed as follows:
2023
2022
2023
2022
£m
£m
%
%
Liability driven investment
33.7
25.3
54.2
35.4
Diversified alternatives
—
26.9
—
37.6
Corporate bonds
25.4
—
40.8
—
Multi-asset credit
—
7.8
—
10.9
Assets held by insurance company
1.0
1.1
1.6
1.5
Cash
2.1
10.3
3.4
14.6
62.2
71.4
100.0
100.0
Liability driven investments, diversified alternatives, corporate bonds and multi-asset credit assets are either pooled or unpooled investment vehicles. Unpooled
investment vehicles, which are not quoted on active markets, have been valued at the latest available bid price or single price provided by the pooled investment
manager. Where funds are valued weekly, the value is taken as at the week ending immediately before or after the year-end date. Shares in other pooled arrangements
have been valued at the latest available net assets value, determined in accordance with fair value principles, provided by the pooled investment manager.
The scheme’s assets are invested in accordance with the statement of investment principles after taking professional advice from the scheme’s investment advisers.
During the year the investment strategy has progressed in line with the trustees’ strategic objective of reaching a buy-out ready position, which has changed the
portfolio allocation of scheme assets. As such, at 31 October 2023 the pension scheme assets have been invested in corporate bonds and a portfolio of leveraged
liability driven pooled funds designed to hedge interest rate and inflation risk.
The scheme’s liability matching portfolio is invested in leveraged pooled liability driven investment (“LDI”) funds, a liquidity fund and investments in funds with
underlying assets in corporate bonds. The trustees target an interest rate and inflation hedge ratio of around 100% (based on the scheme’s technical provisions
funding basis).
Chemring Group PLC Annual report and accounts 2023156

29. RETIREMENT BENEFIT OBLIGATIONS continued
As at 31 October 2022, the Group loaned £2.0m to the Chemring Group Staff Pension Scheme representing a short-term loan to fund margin calls on liability
driven investments. This was included in the 31 October 2022 cash amount in the table above and was repaid in November 2022.
The principal assumptions used in the actuarial valuation of the Chemring Group Staff Pension Scheme were as follows:
2023
2022
%
%
Discount rate
5.6
4.9
Inflation
– RPI
3.6
3.1
– CPI
2.9
2.7
In determining defined benefit obligations, the Group uses mortality assumptions which are based on published mortality tables. For the Chemring Group Staff Pension
Scheme, the actuarial table currently used is S3PA tables (series 3 of the SAPS tables) with future improvements in line with CMI 2022 and a 1.25% long-term trend rate.
This results in the following life expectancies at age 65:
2023
2022
No.
No.
Future pensioners
– male
87.9
88.2
– female
90.0
90.4
Current pensioners
– male
87.1
87.4
– female
88.7
89.0
While the vaccination programme has significantly reduced the number of deaths directly attributable to CV-19, the impact of the pandemic on future mortality
rates remains uncertain. At this stage the Group has assumed CV-19 will have no lasting impact on mortality rates and that life expectancies will return to
pre-pandemic expectations. We will continue to monitor and assess this at future reporting dates.
The most significant assumptions in the pension valuation are the discount rate applied to the liabilities, the inflation rate to be applied to pension payments
and the mortality rates. If the discount rate used in determining retirement benefit obligations were to change by 0.1% then it is predicted that the deficit in the
scheme would change by approximately £0.6m. A change in the rate of inflation by 0.1% is predicted to change the deficit by approximately £0.2m and a 10%
change to the mortality assumption would change the deficit by approximately £1.6m. The principal risks to the scheme are that the investments do not perform
as well as expected, the discount rate continues to rise driven by higher market interest rates, short-term movements in inflation, and the rate of improvement in
mortality assumed is insufficient and life expectancies continue to rise.
The Group anticipates contributions to the defined benefit scheme for the year ending 31 October 2024 will be £nil (2023: £nil).
Subsequent to the year-end, on 28 November 2023 the Trustees of the scheme entered into an agreement with an insurer, Pension Insurance Corporation
(“PIC”), to purchase a bulk annuity insurance policy that operates as an investment asset. Such arrangements are commonly referred to as a “buy-in”. The buy-in
removes all remaining material pension exposure from the balance sheet, while maintaining the security of benefits to the scheme members. The legal responsibility
for the scheme will transfer through a subsequent “buy-out” transaction, expected to be completed in the next 12-24 months. On legal completion of the
buy-out, the defined benefit assets and matching defined benefit liabilities will be derecognised from the Group balance sheet. See note 35 for further details.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 157

NOTES TO THE GROUP FINANCIAL STATEMENTS continued
30. CASH GENERATED FROM OPERATING ACTIVITIES
2023
2022
Notes
£m
£m
Operating profit from continuing operations
45.4
49.4
Amortisation of development costs
12
0.7
0.1
Amortisation of intangible assets arising from business combinations
12
3.0
3.9
Amortisation of patents and licences
12
—
0.1
Impairment of development costs
12
15.6
2.2
Profit on disposal of non-current assets
—
(1.9)
Depreciation of property, plant and equipment
13
18.6
17.7
Non-underlying items
5.2
6.1
Share-based payment expense
27
4.4
6.4
Operating cash flows before movements in working capital
92.9
84.0
Increase in inventories
(18.2)
(6.4)
(Increase)/decrease in trade and other receivables
(18.7)
4.5
Increase in trade and other payables
23.7
2.9
Increase in provisions
0.3
0.1
Operating cash flow from continuing underlying operations
80.0
85.1
Operating cash flow from discontinued underlying operations
(0.8)
5.0
Cash impact of non-underlying items from discontinued operations
(1.9)
—
Net cash (outflow)/inflow from discontinued operating activities
(2.7)
5.0
Net cash (outflow)/inflow from discontinued operations
(2.7)
5.0
31. RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT
2023
2022
£m
£m
(Decrease)/increase in cash and cash equivalents
(13.7)
14.2
Decrease in debt and lease financing due to cash flows
8.8
13.2
(Increase)/decrease in net debt resulting from cash flows
(4.9)
27.4
Effect of foreign exchange rate changes
0.3
(4.2)
Acquired debt
(0.1)
—
New leases entered into, lease interest and other non-cash movements
(2.1)
(3.5)
Amortisation of debt finance costs
(0.4)
(0.3)
Movement in net debt
(7.2)
19.4
Net debt at the beginning of the year
(7.2)
(26.6)
Net debt at the end of the year
(14.4)
(7.2)
32. ANALYSIS OF NET DEBT
At
At
1 November
Non-cash
Exchange
31 October
2022
Cash flows
changes
rate effects
2023
£m
£m
£m
£m
£m
Cash and cash equivalents (including bank overdraft)
19.8
(13.7)
—
0.3
6.4
Debt due after one year
(20.9)
7.0
(0.3)
0.1
(14.1)
Preference shares
(0.1)
—
—
—
(0.1)
(1.2)
(6.7)
(0.3)
0.4
(7.8)
Lease liabilities
(6.0)
1.8
(2.3)
(0.1)
(6.6)
(7.2)
(4.9)
(2.6)
0.3
(14.4)
Accrued interest is included in the carrying amount of interest payable (note 20) measured at amortised cost and therefore is not presented as a separate line
item in the above table.
Chemring Group PLC Annual report and accounts 2023158

33. CONTINGENT LIABILITIES
The Group is, from time to time, party to legal proceedings and claims, and is involved in correspondence relating to potential claims, which arise in the ordinary
course of business.
COUNTERMEASURES UK INCIDENT
On 10 August 2018, an incident occurred at our Countermeasures facility in Salisbury. The Group responded to support those who were injured and all related
claims by employees have now been settled under our employers’ liability insurance. We also fully supported the UK Health and Safety Executive (“HSE”) with
its investigation, which has been concluded. Whilst provisions have been recorded for costs that have been identified (included within “legal provisions”), it is
possible that additional uninsured costs and financial penalties may be incurred as a result of the HSE investigation. At this stage these costs are not anticipated to
be material in the context of the Group’s financial statements.
34. RELATED PARTY TRANSACTIONS
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.
Transactions with the Group’s pension schemes are disclosed in note 29. As at 31 October 2023, £nil (2022: £2.0m) was due from the Chemring Group Staff
Pension Scheme. The balance due in the prior year represented a short-term loan to fund margin calls on liability driven investments which was repaid in
November 2022. The amount receivable was classified in other receivables on the consolidated balance sheet.
REMUNERATION OF KEY MANAGEMENT PERSONNEL
The directors of the Company had no material transactions with the Company during the year, other than in connection with their service agreements.
The remuneration of the executive directors is determined by the Remuneration Committee, having regard to the performance of the individuals and market
trends. The remuneration of the non-executive directors is determined by the Board, having regard to the practice of other companies and the particular
demands of the Group.
For the purposes of remuneration disclosure, key management personnel includes only the directors and excludes the other senior business managers and
members of the Executive Committee. Further information on the remuneration of individual directors is provided in the audited part of the directors’
remuneration report on pages 104 to 108.
Total emoluments for key management personnel charged to the consolidated income statement were:
2023
2022
£m
£m
Short-term employee benefits
2.9
3.2
Post-employment benefits
0.1
0.2
Share-based payment benefits
1.6
2.4
Total remuneration of key management personnel
4.6
5.8
35. POST BALANCE SHEET EVENTS
(A) PENSION BUY-IN/BUY-OUT
Subsequent to the year-end, on 28 November 2023 the trustees of the Group’s legacy UK defined benefit scheme, the Chemring Group Staff Pension Scheme
(“the Scheme”), entered into an agreement with an insurer, Pension Insurance Corporation (“PIC”), to purchase a bulk annuity insurance policy that operates as
an investment asset. Such arrangements are commonly referred to as a “buy-in”. The buy-in removes future risk associated with funding of the Scheme from the
balance sheet, while ensuring the security of benefits for the Scheme members. The buy-in premium has initially been funded through the transfer of the
majority of the Scheme’s assets to PIC, as well as by an upfront contribution from the Group of approximately £1.6m. The upfront contribution from the Group
will be funded from the Group’s existing bank facilities.
The Scheme will now have protection against longevity risk and market risk for the material obligations of all deferred and pensioner members. As a result, the
pension surplus, calculated on an IAS 19 basis, included in the balance sheet at 31 October 2023 of £3.7m net of tax, is expected to be largely removed as the
fair value of this insurance policy, held as an asset of the Scheme, will be set equal to the value of defined benefit obligations covered under IAS 19.
The legal responsibility for the Scheme will transfer through a subsequent “buy-out” transaction, expected to be completed in the next 12-24 months. On
completion of the full buy-out of the scheme, the defined benefit assets and matching defined benefit liabilities will be derecognised from the Group balance
sheet.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 159

PARENT COMPANY BALANCE SHEET
As at 31 October 2023
2023 2022
Note £m £m £m £m
Non-current assets
Property, plant and equipment 1 0.4 0.2
Investments in subsidiaries 2 786.0 766.6
Amounts owed by subsidiary undertakings 3 — 10.7
Retirement benefit surplus 10 3.1 5.8
Deferred tax 9 0.6 0.8
790.1 784.1
Current assets
Trade and other receivables 3 14.6 23.2
Cash and cash equivalents 0.3 —
14.9 23.2
Total assets 805.0 807.3
Current liabilities
Trade and other payables 4 (36.9) (30.7)
(36.9) (30.7)
Non-current liabilities
Borrowings 5 (30.0) (21.8)
Trade and other payables 4 (0.3) (1.1)
Provisions 6 (9.1) (8.2)
Preference shares 7 (0.1) (0.1)
(39.5) (31.2)
Total liabilities (76.4) (61.9)
Net assets 728.6 745.4
Equity
Share capital 8 2.8 2.8
Share premium account 308.7 307.7
Special capital reserve 12.9 12.9
Retained earnings 404.2 422.0
Total equity 728.6 745.4
PROFIT ATTRIBUTABLE TO SHAREHOLDERS
In accordance with the concession granted under section 408 of the Companies Act 2006, the profit and loss account of Chemring Group PLC has not been
presented separately in these financial statements. There is no material difference between the results disclosed and the results on an unmodified historical cost
basis. The Company reported a profit for the year ended 31 October 2023 of £11.0m (2022: £45.1m loss).
These financial statements of Chemring Group PLC (registered number 86662) were approved and authorised for issue by the Board of directors on
12December 2023.
Signed on behalf of the Board
Michael Ord Andrew Lewis
Director Director
Chemring Group PLC Annual report and accounts 2023160

PARENT COMPANY STATEMENT OF COMPREHENSIVEINCOME
For the year ended 31 October 2023
2023 2022
£m £m
Profit/(loss) after tax attributable to equity holders of the parent as reported 11.0 (45.1)
Items that will not be reclassified subsequently to profit and loss
Remeasurement of the defined benefit pension scheme, net of deferred tax (1.6) (0.9)
Total comprehensive income/(loss) attributable to the equity holders of the parent 9.4 (46.0)
PARENT COMPANY STATEMENT OF CHANGES IN EQUITY
For the year ended 31 October 2023
Share Special
premium capital Retained
Share capital account reserve earnings Total
£m £m £m £m £m
At 1 November 2022 2.8 307.7 12.9 422.0 745.4
Profit after tax — — — 11.0 11.0
Other comprehensive loss — — — (1.6) (1.6)
Total comprehensive income — — — 9.4 9.4
Ordinary shares issued — 1.0 — — 1.0
Share-based payments (net of settlement) — — — 7.6 7.6
Deferred tax on share-based payments — — — (0.6) (0.6)
Dividends paid — — — (17.3) (17.3)
Purchase of own shares — — — (16.9) (16.9)
At 31 October 2023 2.8 308.7 12.9 404.2 728.6
Share Special
premium capital Retained
Share capital account reserve earnings Total
£m £m £m £m £m
At 1 November 2021 2.8 307.1 12.9 483.8 806.6
Loss after tax — — — (45.1) (45.1)
Other comprehensive loss — — — (0.9) (0.9)
Total comprehensive loss — — — (46.0) (46.0)
Ordinary shares issued — 0.6 — — 0.6
Share-based payments (net of settlement) — — — 5.6 5.6
Dividends paid — — — (14.4) (14.4)
Purchase of own shares — — — (7.0) (7.0)
At 31 October 2022 2.8 307.7 12.9 422.0 745.4
The auditor’s remuneration for audit and other services is disclosed in note 4 to the Group financial statements.
A final dividend of 4.6p per ordinary share has been proposed. See note 9 to the Group financial statements.
As at 31 October 2023 the Company had distributable reserves of £404.2m (2022: £422.0m). When required, the Company can receive dividends from
itssubsidiaries to further increase distributable reserves.
Included within retained earnings is the Company’s own shares held by the Group’s Employee Share Ownership Plan Trust (“ESOP”); see note 26 of the Group
financial statements for details.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 161

1. PROPERTY, PLANT AND EQUIPMENT
Detailed disclosure of property, plant and equipment was not considered necessary due to its immaterial value. The Company had no capital commitments as at
31 October 2023 or 31 October 2022.
2. INVESTMENTS IN SUBSIDIARIES
Shares in
subsidiary
undertakings
£m
Cost
At 31 October 2022 902.8
Additions 19.4
At 31 October 2023 922.2
Impairment
At 31 October 2022 (136.2)
Impairment —
At 31 October 2023 (136.2)
Carrying amount
At 31 October 2023 786.0
At 31 October 2022 766.6
Investment values are allocated to their respective legal entities. Where the investment value relates to an intermediate holding company, the subsidiaries of that
holding company are used to support the carrying value.
During the year ended 31 October 2023, Chemring Group PLC acquired Geollect Limited for a cost of investment of £7.3m. See note 28 of the Group financial
statements for further details.
As part of a Group reorganisation during the year, investments held in Roke Manor Research Limited and Chemring Energetics UK Limited were transferred at
their carrying value from Chemring Group PLC to one of the Company’s subsidiary entities, Chemring Holdings Limited (formerly CHG Overseas Limited). The
net impact of this transfer on the total value of investments was £nil, as the decrease in the value of the investments held in Roke Manor Research Limited and
Chemring Energetics UK Limited was offset by the increase in the value of the investment held in Chemring Holdings Limited.
In addition, during the year Chemring Group PLC acquired Chemring Technology Solutions Limited from its subsidiary, Chemring Energetics Limited, for £12.1m.
The Company tests investments at least annually for impairment. Tests are conducted more frequently if there are indications that investments might be impaired.
There were no impairment indicators identified during the year ended 31 October 2023. The recoverable amounts of the CGUs are determined from value-in-use
calculations. In determining the value in use, we have allocated central costs necessary to generate the underlying cash flows. The key assumptions for the value-in-use
calculations have been individually estimated for each CGU and are detailed in note 11 of the Group financial statements. All of the CGUs referred to in note 11
represent either investments held directly by the Company or investments held by an intermediate holding company, in which case the value-in-use of the those
CGUs in aggregation is used to support the carrying value of the intermediate holding company. The pre-tax discount rates used for the CGUs ranged from
11.6% to 12.9% (2022: 10.2% to 12.3%).
Stress testing was performed on the forecasts to consider the impact of reasonably possible scenarios over the forecast period, including a 1% reduction in
long-term growth rate, a 1.5% increase in discount rate, a 10% fall in the forecast cash flows or a $0.10 weakening in the GBP to US dollar exchange rate.
Evenunder any of these circumstances, no investment would require an impairment.
Details of the Group undertakings at 31 October 2023 are set out in note 14 to the Group financial statements. The Company has given a parental guarantee
under section 479A of the Companies Act 2006 to certain subsidiary undertakings, details of which are also set out in note 14 to the Group financial statements.
The directors consider that the carrying value of the investments does not exceed their fair value.
NOTES TO THE PARENT COMPANY FINANCIALSTATEMENTS
Chemring Group PLC Annual report and accounts 2023162

3. TRADE AND OTHER RECEIVABLES
2023 2022
£m £m
Within current assets
Amounts owed by subsidiary undertakings 12.9 19.7
Derivative financial instruments (note 22 to the Group financial statements) 0.7 0.7
Prepayments and accrued income 0.7 0.8
Other debtors 0.3 2.0
14.6 23.2
Within non-current assets
Amounts owed by subsidiary undertakings — 10.7
— 10.7
The directors consider that the carrying value of the trade and other receivables approximates to their fair value.
Interest on amounts owed by subsidiary undertakings is charged between 0.0% and 8.5%. No interest is charged on trade and other receivables from the date
ofinvoice to payment. Expected credit losses on financial assets are not material.
As at 31 October 2022, Chemring Group PLC loaned £2.0m to the Chemring Group Staff Pension Scheme to fund margin calls on liability driven investments.
This is a related party transaction, for further details refer to note 34 to the Group financial statements. This short-term loan was included in other debtors
above and was repaid in November 2022.
4. TRADE AND OTHER PAYABLES
2023 2022
£m £m
Within current liabilities
Derivative financial instruments (note 22 to the Group financial statements) 3.2 4.1
Trade payables 0.2 0.5
Amounts owed to subsidiary undertakings 25.7 19.2
Other payables 7.8 6.8
Accruals and deferred income — 0.1
36.9 30.7
Within non-current liabilities
Derivative financial instruments (note 22) 0.3 1.1
37.2 31.8
Other payables of £7.8m (2022: £6.8m) includes payroll-related creditors of £3.6m (2022: £4.4m).
Interest on amounts owed to subsidiary undertakings attracts interest rates between 0% and 5%. No interest is payable on trade payables from the date of
invoice to payment.
5. BORROWINGS
2023 2022
£m £m
Borrowings due after more than one year
Bank borrowings – US dollar denominated — 20.9
Bank borrowings – sterling denominated 30.0 0.9
Total borrowings 30.0 21.8
An analysis of borrowings by maturity is as follows:
2023 2022
£m £m
Borrowings falling due:
– less than one year — —
– within one to two years — —
– within two to five years 30.0 21.8
30.0 21.8
The interest incurred on the above borrowings is detailed within notes 7 and 18 to the Group financial statements. As at 31 October 2023, sterling denominated
borrowings related to drawdowns on the revolving credit facility and the stand-alone Company bank overdraft which carried interest at 6.25%.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 163

6. PROVISIONS
Total
£m
At 31 October 2022 8.2
Provided 1.8
Released (0.2)
Paid (0.7)
At 31 October 2023 9.1
It is not possible to estimate more accurately the expected timing of any resulting outflows of economic benefits. Total provisions include legal provisions, which
represent the estimated legal costs relating to ongoing investigations, and disposal provisions, which relate to estimated liabilities faced by the Company in respect
of the disposal of its European Munitions businesses in 2014 under the terms of their respective sale agreements. See note 23 to the Group financial statements
for further details.
7. PREFERENCE SHARES
2023 2022
£m £m
Cumulative preference shares (62,500 shares of £1 each) 0.1 0.1
The cumulative preference shares carry an entitlement to a dividend at the rate of 7p per share per annum, payable in equal instalments on 30 April and 31
October each year. Holders of the preference shares have the right on a winding-up to receive, in priority to any other classes of shares, the sum of £1 per share
together with any arrears of dividends.
8. SHARE CAPITAL
2023 2022
£m £m
Issued, allotted and fully paid
280,842,610 (2022: 283,541,742) ordinary shares of 1p each 2.8 2.8
During the year, 495,671 ordinary shares (2022: 392,231) were issued for cash to employees under the Group’s approved savings-related share schemes.
On 1 August 2023, the Company announced the details of a share buyback programme to repurchase up to £50m of its own shares over the following 12 months.
See note 25 to the Group financial statements for further details.
The preference shares are presented as a liability and accordingly are excluded from called-up share capital in the balance sheet.
SHARE-BASED INCENTIVE SCHEMES
Full details of the schemes are set out in note 27 to the Group financial statements.
9. DEFERRED TAX
2023 2022
£m £m
At the beginning of the year 0.8 (0.9)
(Charge)/credit to income statement (1.0) 1.2
Credit to other comprehensive income 0.8 0.5
Deferred tax asset at the end of the year 0.6 0.8
The amount provided represents:
Pension (0.8) (2.0)
Other temporary differences 1.4 2.8
0.6 0.8
At the balance sheet date, the Company had unrecognised tax losses of £nil (2022: £nil) potentially available for offset against future profits in
certaincircumstances.
NOTES TO THE PARENT COMPANY FINANCIAL STATEMENTS continued
Chemring Group PLC Annual report and accounts 2023164

10. RETIREMENT BENEFIT OBLIGATIONS
The Company has assumed its share of the assets and liabilities of the Group’s defined benefit pension scheme. An analysis of the surplus balance is shown below:
Total
£m
At 31 October 2021, retirement benefit surplus 7.2
Contributions —
Other finance costs (0.1)
Actuarial movements (1.3)
At 31 October 2022, retirement benefit surplus 5.8
Contributions —
Other finance costs (0.3)
Actuarial movements (2.4)
At 31 October 2023, retirement benefit surplus 3.1
Further details are set out in note 29 to the Group financial statements.
11. STAFF COSTS
2023 2022
Number Number
Average monthly number of total employees (including executive directors) 34 34
The costs incurred in respect of these employees (including share-based payments) were:
2023 2022
£m £m
Wages and salaries 6.6 5.0
Social security costs 0.8 1.0
Other pension costs 0.5 0.6
Share-based payment 5.6 4.2
13.5 10.8
Disclosures in respect of directors’ emoluments can be found in the directors’ remuneration report on pages 100 to 122.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 165

ACCOUNTING POLICIES
1. GENERAL INFORMATION
Chemring Group PLC is a company incorporated in England and Wales under
registration number 86662. The address of the registered office is Roke Manor,
Old Salisbury Lane, Romsey, Hampshire SO51 0ZN . The nature of the Group’s
operations and its principal activities are set out in note 2 of the Group
financial statements and in the directors’ report on pages 123 to 125. These
financial statements are the consolidated financial statements of Chemring
Group PLC and its subsidiaries (the “Group”).
Chemring Group PLC and the companies in which it directly and indirectly
owns investments are separate and distinct entities. In this publication of the
annual report and accounts, the collective expressions “Chemring” and “the
Group” may be used for convenience where reference is made in general to
those companies. Likewise, the words “we”, “us”, “our” and “ourselves” are
used in some places to refer to the subsidiaries of the Group in general.
These expressions are also used where no useful purpose is served by
identifying any particular company or companies.
The financial statements are presented in pounds sterling, being the currency
of the primary economic environment in which the Group operates, and
rounded to the nearest £0.1m. Foreign operations are included in accordance
with the foreign currencies accounting policy.
GOING CONCERN
The directors have, at the time of approving the financial statements, a reasonable
expectation that the Group and the Company have adequate resources to
continue to adopt the going concern basis of accounting in preparing these
financial statements. Further detail is contained in the statement on going
concern on page 77 which forms part of these financial statements.
2. ADOPTION OF NEW AND REVISED STANDARDS
The following standards, amendments and interpretations have been issued
by the International Accounting Standards Board (“IASB”) or by the IFRS
Interpretations Committee. The Group’s approach to these is as follows:
i) There were no IFRS Interpretations Committee (“IFRIC”) interpretations,
amendments to existing standards and new standards adopted in the year
ended 31 October 2023 that have materially impacted the reported
results or the financial position.
ii) The following IFRIC interpretations, amendments to existing standards
and new standards were adopted in the year ended 31 October 2023 but
have not materially impacted the reported results or the financial position:
> Reference to the Conceptual Framework (Amendments to IFRS 3);
> Property, Plant and Equipment – Proceeds before Intended Use
(Amendments to IAS 16);
> Onerous Contracts – Cost of Fulfilling a Contract (Amendments to
IAS 37); and
> Annual Improvements to IFRS Standards 2018–2020.
iii) At the date of authorisation of this announcement, the following
standards and interpretations that are potentially relevant to the Group
and which have not yet been applied in these reported results were in
issue but not yet effective (and in some cases had not yet been adopted
by the UK Endorsement Board):
EFFECTIVE FOR PERIODS BEGINNING ON OR AFTER 1 JANUARY 2023
> IFRS 17 Insurance Contracts;
> Disclosure of Accounting Policies (Amendments to IAS 1 and
IFRS Practice Statement 2);
> Definition of Accounting Estimates (Amendments to IAS 8); and
> Deferred Tax related to Assets and Liabilities arising from a
Single Transaction (Amendments to IAS 12).
EFFECTIVE FOR PERIODS BEGINNING ON OR AFTER 1 JANUARY 2024
> Classification of Liabilities as Current or Non-current (Amendments
to IAS 1);
> Non-current liabilities with covenants (Amendments to IAS 1);
> Supplier finance (Amendments to IAS 7 and IFRS 7);
> Financial instrument disclosures (Amendments to IFRS 7);
> General Requirements for Disclosure of Sustainability-related Financial
Information (IFRS S1); and
> Climate-related Disclosures (IFRS S2).
EFFECTIVE FOR PERIODS BEGINNING ON OR AFTER 1 JANUARY 2025
> Lack of exchangeability (Amendments to IAS 21).
The directors do not expect the adoption of these standards and interpretations
will have a material impact on the results of the Group in future periods .
3. GROUP ACCOUNTING POLICIES
BASIS OF PREPARATION
These financial statements have been prepared in accordance with UK-adopted
international accounting standards (“UK-adopted IFRS”) in conformity with the
requirements of the Companies Act 2006.
The financial statements are prepared under the historical cost convention,
except as described below under the heading of “Derivative financial instruments”.
The accounting policies adopted have been applied consistently throughout
the current and previous year.
For the year ended 31 October 2023, the comparative consolidated income
statement, consolidated cash flow statement and associated disclosure notes
have been re-presented to show the Explosive Hazard Detection division of
the US Sensors business as a discontinued operation.
BASIS OF CONSOLIDATION
The Group financial statements consolidate those of the Company and all of
its subsidiaries. Subsidiaries are entities controlled by the Group. The Group
“controls” an entity when it is exposed to, or has rights to, variable returns
from its involvement with the entity and has the ability to affect those returns
through its power over the entity. The financial statements of subsidiaries are
included in the consolidated financial statements from the date on which
control commences until the date on which control ceases.
The Company considers that it has the power to govern the financial and
operating policies of the US entities falling within the Special Security
Agreement and these entities have therefore been consolidated in these
financial statements.
The Company and all of its subsidiaries make up their financial statements
to the same date. All intra-group transactions, balances, income and expenses
are eliminated on consolidation.
Non-controlling interest
The Group recognises non-controlling interest in an acquired entity either at
fair value or at the non-controlling interest’s proportionate share of the acquired
entity’s net identifiable assets. This decision is made on an acquisition-by-acquisition
basis. For non-controlling interests that the Group holds, the Group elected
to recognise the non-controlling interests at its proportionate share of the
acquired net identifiable assets.
Q6 Holdings Limited, a wholly owned subsidiary of Chemring Group PLC,
owns 80% of the issued shares of Vigil AI Limited. Disclosure of the minority
interest on the face of the primary statements has not been included as this
is considered immaterial to the Group. As at 31 October 2023, profit, total
comprehensive income and equity attributable to minority interests were
less than £0.1m.
Chemring Group PLC Annual report and accounts 2023166

3. GROUP ACCOUNTING POLICIES continued
REVENUE RECOGNITION
Chemring is organised into two sectors, Sensors & Information and
Countermeasures & Energetics.
From a revenue recognition perspective, whilst Chemring operates across the
whole lifecycle of its products and services, these are generally awarded by its
customers as individual contracts for the different stages rather than being large,
complex, long-term framework agreements requiring extensive consideration
of price allocation and performance obligations. As a result we are less
susceptible to judgements over revenue recognition regarding contract
performance, modifications and cancellations.
Whilst as a Group we aim to develop products which can be sold on to multiple
end users and markets, in some instances the nature of products and services
are unique to a customer and may not have an alternative use at the point of
production. In such cases, where an enforceable right to payment exists,
revenue will be recognised over time.
From time to time we enter into contracts for “customer-funded R&D” where
Chemring provides a service towards the development of a technology for a
customer resulting in revenue. In certain instances, Chemring partly funds the
development effort and these can result in the recognition of a controlled asset.
Contracts
The majority of the Group’s revenue arises from the manufacture and
shipment of goods.
Sales contracts are reviewed for performance obligations but the principal driver
for timing of revenue recognition is delivery obligations, typically based on
Incoterms. Certain contracts may also require customer acceptance testing.
Once the relevant delivery obligation has been met and, as applicable,
customer acceptance received, revenue can be recognised.
The timing of payment from customers is generally aligned to revenue recognition,
though on certain contracts advance receipts are received as disclosed in note
20. This also applies to sales where there are no goods shipped but a deliverable is
completed at a certain point in time, such as the issue of a report where there
is no enforceable right to payment for work in progress.
In a smaller number of cases, revenue also arises from milestone contracts that
contain multiple performance obligations. Often these contracts are already
divided into milestones for payment purposes, but judgement is required when
assessing the way the contract is divided up to ensure that each element is a
separate and valid performance obligation. If they are not, the relevant revenue
amount is allocated across the other obligations as appropriate. In some cases
milestones are achieved in one period but not billed until the next period,
leading to a timing difference with the recognition of revenue in advance of
customer billing. In this instance accrued income is recognised as described
in note 16. There are no contracts with a significant financing component.
At the start of the contract, the total transaction price is estimated as the amount
of consideration to which the Group expects to be entitled in exchange for
transferring the promised goods and services to the customer, excluding sales
taxes. This is based on the agreed contract price, with no material claims and
incentive payment terms, and therefore significant judgement to determine the
transaction price is not required. Typically our contracts do not have any material
variable consideration and no significant judgement has been required around
the extent to which this ought to be recognised. The total transaction price is
allocated to the performance obligations identified in the contract in proportion
to their relative stand-alone selling prices, where stand-alone selling prices are
typically estimated based on expected costs plus contract margin.
The Group provides warranties to its customers to give them assurance that
its products and services will function in line with agreed-upon specifications.
Warranties are not provided separately and, therefore, do not represent
separate performance obligations.
A number of sales contracts allow for bill and hold arrangements, where the
customer has bought the goods but has not yet taken physical possession. This
usually arises when the customer has limited storage space or there have been
delays in their own production schedule. For such revenue to be recognised
the bill and hold arrangement must be substantive and the relevant goods
must be clearly identified as belonging to the customer and ready for immediate
shipment at the customer’s request. These categories of sales are common
across all segments.
Qualifying costs to obtain a contract are not material across the Group.
Sale of goods
Revenue from the sale of goods is recognised when all of the following
conditions are satisfied:
- the Group has identified a sales contract with a customer;
- the performance obligations within this contract have been identified;
- the transaction price has been determined;
- this transaction price has been allocated to the performance obligations in
the contract; and
- revenue is recognised as or when each performance obligation is satisfied.
Performance obligations are satisfied when the customer gains control of
promised goods or services from the contract. Customers do not typically
gain a right of return of goods.
Rendering of services
Revenue from a contract to provide services, including customer-funded research
and development, is recognised by reference to the stage of completion of the
contract. Stage of completion is typically estimated by either the proportion of
contract costs incurred for work performed to date or completion of relevant
milestones where this faithfully depicts the transfer of control of the goods
and services to the customer and does not significantly differ from using the
proportion of contract costs incurred basis.
Another significant source of Group revenue, especially within the Sensors &
Information segment, arises from time and materials contracts, where revenue
is typically accrued and billed in the following month based on work performed
to date, following which payment is typically promptly received.
Principal versus agent assessment
The Group enters into certain arrangements which involve a consortium of
service providers. The Group acts as a “prime” contractor in certain contracts
with customers and utilises sub-contractors to undertake the work. Under these
contracts the Group is considered to be primarily responsible for fulfilling the
service to the customer. The Group performs a technical assessment of the
work before it is delivered to the customer and is responsible for quality and
performance of the sub-contractor. As such the Group is considered to be the
principal to the arrangement with the customer and includes sub-contractor
costs within revenue. However, where the Group is merely acting as an agent
of a sub-contractor then no revenue is recognised in respect of sub-contractor costs.
All consortium arrangements are assessed by the Group to determine if it is
the principal or agent considering who is responsible for fulfilling the performance
obligation, who bears inventory risk and who has price discretion.
Contract assets and liabilities
As described above, on some contracts there is a timing difference between
the recognition of revenue and the customer billing. Where this is the case,
contract asset and liability balances are recognised, referred to as accrued
income or deferred income and advance receipts from customers in the
financial statements.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 167

3. GROUP ACCOUNTING POLICIES continued
ACQUISITIONS AND DISPOSALS
On acquisition of a subsidiary, associate or jointly controlled entity, the cost
is measured as the fair value of the consideration. The assets, liabilities and
contingent liabilities of subsidiary undertakings that meet the IFRS 3 (Revised)
Business Combinations recognition criteria are measured at the fair value at the
date of acquisition, except that:
- deferred tax assets or liabilities, and liabilities or assets relating to employee
benefit arrangements, are recognised and measured in accordance with IAS
12 Income Taxes and IAS 19 (Revised) Employee Benefits respectively;
- liabilities or equity instruments related to the replacement by the Group of
an acquiree’s share-based payment awards are measured in accordance with
IFRS 2 Share-based Payments; and
- assets (or disposal groups) that are classified as held for sale, in accordance
with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations, are
measured in accordance with that standard.
Where cost exceeds fair value of the net assets acquired, the difference
is recorded as goodwill.
Where the fair value of the net assets exceeds the cost, the difference
is recorded directly in the income statement. The accounting policies of
subsidiary undertakings are changed where necessary to be consistent
with those of the Group.
If the initial accounting for a business combination is incomplete by the end of
the reporting period in which the combination occurs, the Group reports
provisional amounts for the items for which the accounting is incomplete.
Those provisional amounts are adjusted during the measurement period (see
below), or additional assets or liabilities recognised, to reflect new information
obtained about facts and circumstances that existed as at the acquisition date
that, if known, would have affected the amounts recognised as at that date.
The measurement period runs from the date of acquisition to the date the
Group obtains complete information about facts and circumstances that
existed as at the acquisition date, subject to a maximum period of one year.
In accordance with IFRS 3 (Revised) Business Combinations, acquisition
and disposal-related items are recognised through the income statement.
Acquisition and disposal-related items refer to credits and costs associated
with the acquisition and disposal of businesses, together with the costs of
aborted bids and the establishment of joint ventures.
DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE
When the Group makes a decision to exit a significant business unit or separate
major line of business, the associated operations and cash flows are classified
as discontinued operations in the financial statements, in accordance with the
provisions of IFRS 5 Non-current Assets Held for Sale and Discontinued Operations.
These discontinued operations may represent components of the Group that
have already been disposed of or are classified as held for sale.
Non-current assets and disposal groups classified as held for sale are measured
at the lower of carrying amount and fair value less costs to sell.
Non-current assets and disposal groups are classified as held for sale if their
carrying amount will be recovered through a sales transaction rather than
continuing use. This condition is regarded as met only when the sale is highly
probable and the asset or disposal group is available for immediate sale in
itsxpresent condition. Management must be committed to the sale which
should be expected to qualify as a completed sale within one year from
the date of classification.
INTANGIBLE ASSETS – GOODWILL
The purchased goodwill of the Group is regarded as having an indefinite
useful economic life and, in accordance with IAS 36 Impairment of Assets,
is not amortised but is subject to annual tests for impairment. On disposal
of a subsidiary, associate or jointly controlled entity, the amount attributable
to goodwill is included in the determination of the profit or loss on disposal.
ACQUIRED INTANGIBLES
The Group recognises, separately from goodwill, intangible assets that are
separable or arise from contractual or other legal rights and whose fair value can
be measured reliably. These intangible assets are amortised at rates calculated
to write down their cost or valuation to their estimated residual values by
equal instalments over their estimated useful economic lives, which are:
- technology – average of ten years
- customer relationships – average of ten years
DEVELOPMENT COSTS
Development costs that qualify as intangible assets are capitalised as incurred
and, once the relevant intangible asset is ready for use, are amortised on a
straight-line basis over their estimated useful lives, averaging ten years
(2022: ten years).
The carrying value of development assets is assessed for recoverability at least
annually or when a trigger is identified.
PATENTS AND LICENCES
Patents and licences are measured initially at purchase cost and are amortised
on a straight-line basis over their estimated useful lives, averaging six years
(2022: seven years).
PROPERTY, PLANT AND EQUIPMENT
Other than historically revalued land and buildings, property, plant and
equipment is held at cost less accumulated depreciation and any recognised
impairment loss. Borrowing costs on significant capital expenditure projects
are capitalised and allocated to the cost of the project.
No depreciation is provided on freehold land. On other assets, depreciation
is provided at rates calculated to write down their cost or valuation to their
estimated residual values by equal instalments over their estimated useful
economic lives, which are:
- freehold buildings – up to fifty years
- leasehold buildings – the period of the lease
- plant and equipment – up to ten years
IMPAIRMENT OF NON-CURRENT ASSETS
Assets that have indefinite lives are allocated to the Group’s cash-generating units
and tested for impairment at least annually. Assets that are subject to depreciation
or amortisation are reviewed for impairment whenever changes in circumstances
indicate that the carrying value may not be recoverable. To the extent that the
carrying value exceeds the recoverable amount, an impairment loss is recorded
for the difference as an expense in the income statement. The recoverable
amount used for impairment testing is the higher of the value-in-use and the
asset’s fair value less costs of disposal. For the purpose of impairment testing,
assets are grouped at the lowest levels for which there are separately
identifiable cash flows.
INVENTORIES
Inventories are recorded at the lower of cost and net realisable value. Cost
represents materials, direct labour, other direct costs and related overheads,
and is determined using a weighted average cost basis. Net realisable value is
based on estimated selling price, less further costs expected to be incurred to
completion and disposal.
Provision is made for slow-moving, obsolete and defective items
where appropriate.
BORROWING COSTS
Borrowing costs directly attributable to the acquisition, construction
or production of qualifying assets, which are assets that necessarily take
a substantial period of time to prepare for their intended use, are added
to the cost of those assets, until such time as the assets are ready for their
intended use. Once the assets are ready for their intended use, these capitalised
borrowing costs are depreciated in line with the underlying asset.
All other borrowing costs are recognised in the income statement in the
period in which they are incurred.
ACCOUNTING POLICIES continued
Chemring Group PLC Annual report and accounts 2023168

3. GROUP ACCOUNTING POLICIES continued
GOVERNMENT GRANTS
Government grants are not recognised until there is reasonable assurance
that the Group will comply with the conditions attaching to them and that
the grants will be received.
Government grants for staff retraining costs are recognised as income over
the periods necessary to match them with the related costs and are deducted
in reporting the related expense.
Government grants relating to property, plant and equipment are treated as
deferred income and released to the income statement over the expected
useful economic lives of the assets concerned.
TA X
The tax expense represents the sum of current tax and deferred tax.
Current tax is based on taxable profit for the year. Taxable profit differs from
profit as reported in the income statement because it excludes items
of income or expense that are taxable or deductible in other years, and it
excludes items of income or expense that are never taxable or deductible.
The Group’s liability for current tax is calculated using tax rates that have
been enacted or substantively enacted at the balance sheet date.
Deferred tax represents amounts expected to be payable or recoverable
on differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used in the
computation of taxable profit, and is accounted for using the balance sheet
liability method. Deferred tax liabilities are generally recognised for all taxable
temporary differences, and deferred tax assets are recognised to the extent
that it is probable taxable profits will be available in the future against which
deductible temporary differences can be utilised. Such assets and liabilities are
not recognised if the temporary difference arises from goodwill or from the
initial recognition (other than in a business combination) of other assets and
liabilities in a transaction that affects neither the taxable profit nor the
accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences arising
on investments in subsidiaries and associates, and interests in joint ventures,
except where the Group is able to control the reversal of the temporary
difference and it is probable that the temporary difference will not reverse
in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at each balance sheet
date and reduced to the extent that it is no longer probable that sufficient
taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the
period when the liability is settled or the asset is realised. Deferred tax is
charged or credited in the income statement, except where it relates to items
charged or credited directly to equity, in which case the deferred tax is also
dealt with in equity.
Deferred tax assets and liabilities are offset when there is a legally enforceable
right to set off current tax assets against current tax liabilities, when they relate
to income taxed by the same tax authority, and when the Group intends to
settle its current tax assets and liabilities on a net basis.
SPECIAL CAPITAL RESERVE
The special capital reserve was created as part of a capital reduction scheme
involving the cancellation of the share premium account which was approved
by the Court in 1986, in accordance with the requirements of the Companies
Act 1985.
FOREIGN CURRENCIES
The individual financial statements of each Group company are presented in its
functional currency, being the currency of the primary economic environment
in which it operates. For the purpose of these Group financial statements, the
results and financial position of each Group company are expressed in pounds
sterling, which is the functional currency of the Company, and the presentation
currency for these financial statements.
In preparing the financial statements of each Group company, transactions in
foreign currencies, being currencies other than the entity’s functional currency,
are recorded at the rates of exchange prevailing on the dates of the transactions.
At each balance sheet date, monetary assets and liabilities that are denominated
in foreign currencies are retranslated at the rates prevailing on the balance
sheet date. Non-monetary items carried at fair value that are denominated in
foreign currencies are translated at the rates prevailing at the date when the
fair value was determined.
Non-monetary items that are measured in terms of historical cost in a foreign
currency are not retranslated.
Exchange differences arising on the settlement of monetary items and on
the retranslation of monetary items are included in the income statement
for the period.
In order to hedge its exposure to certain foreign exchange risks, the Group
enters into forward foreign exchange contracts which are accounted for as
derivative financial instruments (see below for details of the Group’s
accounting policies in respect of such derivative financial instruments).
For the purpose of presenting these financial statements, the assets and liabilities
of the Group’s foreign operations are translated at exchange rates prevailing
on the balance sheet date. Income and expense items are translated at the
average exchange rates for the period.
Goodwill and fair value adjustments arising on the acquisition of a foreign
entity are treated as assets and liabilities of the foreign entity and translated
at the closing rate.
FINANCIAL INSTRUMENTS
Financial assets and liabilities are recognised in the Group’s balance sheet when
the Group becomes a party to the contractual provisions of the instrument.
FINANCIAL ASSETS
Trade receivables
Trade receivables do not carry any interest and are stated at their fair value
and amortised cost as reduced by appropriate allowances for expected
credit losses.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits,
and other short-term highly liquid investments that are readily convertible
to a known amount of cash and are subject to an insignificant risk of change
in value.
FINANCIAL LIABILITIES AND DERIVATIVE FINANCIAL INSTRUMENTS
Financial liabilities
Financial liabilities and equity instruments are classified according to the
substance of the contractual arrangements entered into.
Bank borrowings
Interest bearing bank loans and overdrafts are recorded at the proceeds received,
net of direct issue costs. Finance charges, including premiums payable on settlement
or redemption, and direct issue costs are accounted for on an accruals basis in
the income statement using the effective interest method, and are added to
the carrying amount of the instrument to the extent that they are not settled
in the period in which they arise.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 169

3. GROUP ACCOUNTING POLICIES continued
FINANCIAL LIABILITIES AND DERIVATIVE FINANCIAL INSTRUMENTS
continued
Trade payables
Trade payables are not interest bearing and are stated at their fair value and
amortised cost.
Derivative financial instruments
The Group’s activities expose it to the financial risks of foreign currency
transactions, and it uses forward foreign exchange contracts to hedge its
exposure to these transactional risks. The Group does not use derivative
financial instruments for speculative purposes.
Derivative financial instruments are recognised at fair value on the date the
derivative contract is entered into and are revalued to fair value at each
balance sheet date. The fair values of derivative financial instruments are
calculated by external valuers.
The Group does not apply hedge accounting for derivative financial
instruments, with changes in the fair value of derivatives being recognised in
the income statement immediately.
Hedges of net investments in foreign operations
Any gain or loss on the hedging instrument relating to the effective portion
ofthe hedge is recognised in the statement of comprehensive income and
accumulated in the translation reserve. The gain or loss relating to the
ineffective portion is recognised immediately in the income statement.
RETIREMENT BENEFIT COSTS
Payments to defined contribution retirement benefit schemes are charged
as an administrative expense in the period to which they relate. For defined
benefit schemes, the cost of providing benefits is determined using the projected
unit credit method, with actuarial valuations being carried out at each balance
sheet date. Remeasurement of the defined benefit pension scheme, which
comprises actuarial gains and losses, the return on plan assets (excluding
interest) and the effect of the asset ceiling (if any, excluding interest), are
recognised in the statement of comprehensive income in full in the period
in which they occur.
The Group determines the net interest income on the net defined benefit
asset for the period by applying the discount rate used to measure the defined
benefit obligation at the beginning of the annual period to the then net defined
benefit asset, taking into account any changes in the net defined benefit asset
during the year as a result of contributions and benefit payments. Net interest
income and other expenses related to defined benefit plans are recognised in
profit or loss.
When the benefits of a plan are changed or when a plan is curtailed, the
resulting change in benefit that relates to past service or the gain or loss on
curtailment is recognised immediately in profit or loss.
The retirement benefit obligation recognised in the balance sheet represents
the present value of the defined benefit obligation as reduced by the fair value
of scheme assets. Any asset resulting from this calculation is limited to past
service cost, plus the present value of available refunds and reductions in
future contributions to the scheme.
LEASED ASSETS
At the lease commencement date (i.e. the date the underlying asset is available
for use), the Group recognises a right-of-use asset and a lease liability on the
balance sheet.
The lease liability is initially measured at the present value of future lease
payments, discounted using the Group’s incremental borrowing rate. The
right-of-use asset is initially measured at cost, comprising the initial value of the
lease liability, any lease payments made before commencement of the lease,
any initial direct costs and any restoration costs. The asset is recorded as
property, plant and equipment, and is depreciated over the shorter of its
estimated useful economic life and the lease term on a straight-line basis.
The finance cost is charged to the income statement over the lease term to
produce a constant periodic rate of interest on the lease liability. The lease
payment is allocated between repayment of the lease liability and finance cost.
The Group has elected to account for short-term leases and leases of
low-value assets using the practical expedients. Instead of recognising a
right-of-use asset and lease liability, the payments in relation to these are
recognised as an expense in the income statement on a straight-line basis over
the lease term.
SHARE-BASED COMPENSATION
The Group operates equity-settled share-based compensation schemes.
For grants made under the Group’s share-based compensation schemes,
the fair value of an award is measured at the date of grant and reflects any
market-based vesting conditions. Non-market-based vesting conditions are
excluded from the fair value of the award. At the date of grant, the Company
estimates the number of awards expected to vest as a result of non-market-
based vesting conditions, and the fair value of this estimated number of awards
is recognised as an expense in the income statement on a straight-line basis
over the vesting period. At each balance sheet date, the impact of any revision
to vesting estimates is recognised in the income statement over the vesting
period. Proceeds received, net of any directly attributable transaction costs,
are credited to share capital and share premium.
PROVISIONS
Provisions are recognised when the Group has a present obligation,
either legal or constructive, as a result of a past event, it is probable that the
Group will be required to settle that obligation, and a reliable estimate can be
made of the amount of the obligation. The amount recognised as a provision is
the best estimate of the consideration required to settle the present obligation
at the balance sheet date, taking into account the risks and uncertainties surrounding
the obligation. Where a provision is measured using the estimated cash flows
to settle the present obligation, its carrying amount is the present value of
those cash flows. The Group uses the “expected value” or “most likely outcome”
method on a case-by-case basis to estimate the value of provisions.
When some or all of the economic benefits required to settle a provision are
expected to be recovered from a third party, a receivable is recognised as an
asset if it is virtually certain that reimbursement will be received and the
amount of the receivable can be measured reliably.
Environmental provisions
Where the Group is liable for decontamination work or the restoration of
sites to their original condition, an estimate is made of the costs needed to
complete these works, discounted back to present values, relying upon
independent third party valuers where appropriate.
Restructuring provisions
A restructuring provision is recognised when the Group has developed a
detailed formal plan for the restructuring and has raised a valid expectation in
those affected that it will carry out the restructuring by starting to implement
the plan or announcing its main features to those affected by it. The measurement
of a restructuring provision includes only the direct expenditures arising from
the restructuring and not those associated with the ongoing activities of the entity.
Warranty provisions
Provisions for the expected cost of warranty obligations under local sale of
goods legislation are recognised at the date of sale of the relevant products,
based upon the best estimate of the expenditure required to settle the
Group’s obligations.
Disposal provisions
Disposal provisions relate to estimated liabilities faced by the Group in respect
of discontinued operations and other disposed entities under the terms of
their respective sale agreements.
ACCOUNTING POLICIES continued
Chemring Group PLC Annual report and accounts 2023170

3. GROUP ACCOUNTING POLICIES continued
CONTINGENT LIABILITIES
The Group exercises judgement in recognising exposures to contingent
liabilities related to pending litigation or other outstanding claims subject to
negotiated settlement, mediation, arbitration or government regulation, as
well as other contingent liabilities. Judgement may be necessary in assessing
the likelihood that a pending claim will succeed, or a liability will arise, and/or
to quantify the possible range of the financial settlement.
ALTERNATIVE PERFORMANCE MEASURES
In the analysis of the Group’s financial performance and position, operating
results and cash flows, APMs are presented to provide readers with additional
information. The principal APMs presented are underlying measures of earnings
including underlying operating profit, underlying profit before tax, underlying
profit after tax, underlying EBITDA, underlying earnings per share and underlying
operating cash flow. In addition, EBITDA, net debt and constant currency
metrics are presented which are also considered non-IFRS measures. These
measures are consistent with information regularly reviewed by management
to run the business, including planning, budgeting and reporting purposes and
for its internal assessment of the operational performance of individual businesses.
The directors believe that the use of these APMs assists in providing additional
information on the underlying trends, performance and position of the Group.
APMs are used to assist with the comparability of information between reporting
periods by adjusting for items that are non-recurring or otherwise non-underlying.
Management considers non-underlying items to be:
- amortisation of acquired intangibles;
- material exceptional items, for example relating to acquisitions and disposals,
business restructuring costs and legal costs;
- gains or losses on the movement in the fair value of derivative financial
instruments; and
- the tax impact of all of the above.
The Group’s use of APMs is consistent and we provide comparatives alongside
all current period figures.
Further detail on the APMs presented within these financial statements,
including a reconciliation to the IFRS equivalent, is presented in note 3.
EXCEPTIONAL ITEMS
Exceptional items are excluded from management’s assessment of profit
because by their size or nature they need to be separately disclosed to
properly understand the Group’s underlying quality of earnings. They are
typically gains or losses arising from events that are not considered part of
the core operations of the business. These items are excluded to reflect
performance in a consistent manner and are in line with how the business is
managed and measured on a day-to-day basis.
POST-BALANCE SHEET EVENTS
In accordance with IAS 10 Events after the Reporting Period, the Group
continues to disclose events that it considers material, non-disclosure of which
can influence the economic decisions of users of the financial statements.
4. CHEMRING GROUP PLC – PARENT COMPANY
ACCOUNTINGPOLICIES
FRS 101 REDUCED DISCLOSURE FRAMEWORK
The financial statements have been prepared in accordance with UK accounting
standards and applicable law, including FRS 101 Reduced Disclosure Framework.
The Company operates a defined benefit scheme including employees of other
Group companies (a Group plan). Following FRS 101, the scheme assets and
liabilities have been allocated across the Group companies using a method that
management considers to be the most appropriate, based on scheme
membership, in accordance with the Group’s internal policy.
The following exemptions from the requirements of IFRS have been applied in
the preparation of these financial statements, in accordance with FRS 101:
- share-based payments;
- financial instruments;
- fair value measurements;
- IFRS 16 Leases (paragraphs 52 and 58);
- presentation of comparative information in respect of certain assets;
- IFRSs issued but not yet effective;
- related party transactions;
- assumptions and sensitivities for impairment review; and
- cash flow.
Investment in Group undertakings
Investments are stated at cost less any provision for impairment in value.
Critical accounting judgements and sources of estimation uncertainty
There are no critical accounting judgements for the Company. The other
non-significant areas that include a degree of estimation uncertainty arebelow.
5. ACCOUNTING JUDGEMENTS AND SOURCES OF
ESTIMATION UNCERTAINTY
When applying the Group’s accounting policies, management must make
judgements, assumptions and estimates concerning the future that affect the
carrying amounts of assets and liabilities at the balance sheet date and the
amounts of revenue and expenses recognised during the period. Such
judgements, assumptions and estimates are based upon factors including
historical experience, the observance of trends in the industries in which the
Group operates, and information available from the Group’s customers and
other external sources.
ACCOUNTING JUDGEMENTS
Revenue recognition
Following IFRS 15 Revenue from Contracts with Customers, the Group recognises
revenue on the basis of the satisfaction of performance obligations.
Management has to consider whether performance obligations should be
recognised at a single point in time, which is generally the case for the sale of
products by the Group, or over a period of time, which is more common for
certain service contracts.
In making its judgement about obligations that are satisfied at a point in time,
management has to consider at what point control has passed to the customer,
allowing revenue to be recognised. This is typically determined through a
consideration of customer acceptance testing, stage of completion, contract
terms and delivery arrangements.
KEY SOURCES OF ESTIMATION UNCERTAINTY
There are no key sources of estimation uncertainty at the balance sheet date
that have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year.
OTHER NON-SIGNIFICANT AREAS THAT INCLUDE A DEGREE
OF ESTIMATION UNCERTAINTY OR JUDGEMENTS
While these areas do not present a significant risk resulting in a material
adjustment, they are areas of focus for management and include:
Provisions
The Group holds provisions where appropriate in respect of future economic
outflows which arise due to past events. These are subject to uncertainty in
respect of the outcome of future events. Estimates, judgements and assumptions
are based on factors including historical experience, the observance of trends
in the industries in which the Group operates, and information available from
the Group’s customers and other external sources. Actual outflows of economic
benefit may not occur as anticipated, and estimates may prove to be incorrect,
leading to further charges or releases of provisions as circumstances change.
The provisions held by the Group as at 31 October 2023 are set out in note 23.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 171

5. ACCOUNTING JUDGEMENTS AND SOURCES OF
ESTIMATIONUNCERTAINTY continued
OTHER NON-SIGNIFICANT AREAS THAT INCLUDE A DEGREE
OFESTIMATION UNCERTAINTY OR JUDGEMENTS continued
Goodwill impairment
Determining whether goodwill is impaired requires an estimation of the
value-in-use of the cash-generating units to which goodwill has been allocated.
The value-in-use calculation requires the entity to estimate the future cash
flows expected to arise from the cash-generating unit, and to determine a
suitable discount rate in order to calculate present value (see note 11). In
reviewing the carrying value of goodwill of the Group’s businesses, the Board
has considered the separate plans and cash flows of these businesses consistent
with the requirements of IAS 36 Impairment of Assets. The plans and cash
flows of these businesses reflect current and anticipated conditions in the
defence industry. The total goodwill intangible asset is set out in note 11,
which shows a carrying value of £100.5m at 31 October 2023.
Capitalised development costs impairment
IAS 38 Intangible Assets requires that development costs, arising from the
application of research findings or other technical knowledge to a plan or
design of a new substantially improved product, are capitalised, subject to
certain criteria being met. Determining the future cash flows generated by the
products in development requires estimates which may differ from the actual
outcome. In particular, this can depend on the estimation applied to future
milestone events to secure long-term positions on production contracts, for
example Programs of Record for the US DoD. The total capitalised development
intangible asset is set out in note 12, which shows a carrying value of £17.6m at
31 October 2023. Included in this balance are individually material balances
relating to Joint Biological Tactical Detection System (£9.2m) and Perceive (£5.5m).
Taxation
The Group operates in a number of countries around the world. Uncertainties
exist in relation to the interpretation of complex tax legislation, changes in tax
laws and the amount and timing of future taxable income. In some jurisdictions
agreeing tax liabilities with local tax authorities can take several years. This could
necessitate future adjustments to taxable income and expense already recorded.
At the year-end date, tax liabilities and assets are based on management’s best
judgements around the application of the tax regulations and management’s
estimate of the future amounts that will be settled.
The Group’s operating model involves the cross-border supply of goods into
end markets. There is a risk that different tax authorities could seek to assess
higher profits (or lower costs) to activities being undertaken in their jurisdiction,
potentially leading to higher total tax payable by the Group.
At 31 October 2023 there was a provision of £2.3m in respect of uncertain
tax positions. Due to the uncertainties noted above, there is a risk that the
Group’s judgements are challenged, resulting in a different tax payable or
recoverable from the amounts provided. Management estimates that the
reasonably possible range of outcomes is between £nil and £3.5m.
Deferred tax assets on tax losses and US interest deductions
The category of deferred tax asset which contains significant estimation
uncertainty and which requires management judgement in assessing its
recoverability relates to US interest limitations and tax losses carried forward
(see note 24).
Applicable accounting standards permit the recognition of deferred tax assets
only to the extent that it is probable that future taxable profits will be available,
or to the extent that the existing taxable temporary differences, of an
appropriate type, reverse in an appropriate period to utilise the tax losses
carried forward. The assessment of future taxable profits involves significant
estimation uncertainty, principally relating to an assessment of management’s
projections of future taxable income based on business plans and ongoing
tax planning strategies. These projections include assumptions about the
future strategy of the Group, the economic and regulatory environment in
which the Group operates, future tax legislation and customer behaviour,
amongst other variables.
Defined benefit pension scheme
Estimation is required in the determination of the discount rate and inflation
assumptions underpinning the valuation of the liabilities of the Group’s defined
benefit pension scheme. There is a range of possible values for each of the
actuarial assumptions and small changes in assumptions may have a significant
impact on the size of the deficit. Note 29 provides information on the key
assumptions and analysis of their sensitivities.
Investments in subsidiaries impairment (parent company only)
The parent company tests investments at least annually for impairment, in
addition to when there is an indicator of impairment. Determining whether
investments in subsidiaries are impaired requires an estimation of the value-in-use
of the legal entities to which the investments relate. Where the investment
value relates to an intermediate holding company, the subsidiaries of that
holding company are used to support the carrying value. The value-in-use
calculation requires the entity to estimate the future cash flows expected to
arise from the legal entity, and to determine a suitable discount rate in order
to calculate present value (see note 11 of the Group financial statements). In
reviewing the carrying value of investments in subsidiaries, the Board has
considered the separate plans and cash flows of these businesses consistent
with the requirements of IAS 36 Impairment of Assets. The plans and cash
flows of these businesses reflect current and anticipated conditions in the
defence industry. The total investments in subsidiaries are set out in note 2 of
the parent company financial statements, which shows a carrying value of
£786.0m at 31 October 2023.
CLIMATE CHANGE
In preparing the financial statements, we have considered the impact of both
physical and transitional climate change risks, which have helped develop the
Group’s internal transitional plan to ensure we achieve our climate-related
targets, through the monitoring and assessment of our environmental metrics,
(discussed earlier in the annual report). The key element to achieving our
climate-related target in our transitional plan is the electrification, energy
efficiency and renewable energy sourcing for our operations; this approach
requires upgrading and improvement of current facilities and equipment to be
more efficient is dependent on future capital expenditure. Therefore, the main
areas affected from a financial perspective have been our impairment and
going concern and viability assessments where we have ensured that these
potential risks have been appropriately considered in forecast cash flows used.
ACCOUNTING POLICIES continued
Chemring Group PLC Annual report and accounts 2023172

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CHEMRING GROUP PLC
1. OUR OPINION IS UNMODIFIED
We have audited the financial statements of Chemring Group PLC
(the“Company”) for the year ended 31 October 2023 which comprise the
consolidated income statement, consolidated statement of comprehensive
income, consolidated statement of changes in equity, consolidated balance
sheet, consolidated cash flow statement, parent company balance sheet,
parent company statement of comprehensive income, parent company
statement of changes in equity, and the related notes, including the
accountingpolicies in notes 3 and 4.
In our opinion:
- the financial statements give a true and fair view of the state of the Group’s
and of the parent company’s affairs as at 31 October 2023 and of the
Group’s profit for the year then ended;
- the Group financial statements have been properly prepared in accordance
with UK-adopted international accounting standards;
- the parent company financial statements have been properly prepared in
accordance with UK accounting standards, including FRS 101 Reduced
Disclosure Framework; and
- the financial statements have been prepared in accordance with the
requirements of the Companies Act 2006.
BASIS FOR OPINION
We conducted our audit in accordance with International Standards on
Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities are
described below. We believe that the audit evidence we have obtained is a
sufficient and appropriate basis for our opinion. Our audit opinion is consistent
with our report to the Audit Committee.
We were first appointed as auditor by the directors on 23 March 2018. The
period of total uninterrupted engagement is for the six financial years ended
31October 2023. We have fulfilled our ethical responsibilities under, and we
remain independent of the Group in accordance with, UK ethical requirements
including the FRC Ethical Standard as applied to listed public interest entities.
Nonon-audit services prohibited by that standard were provided.
Overview
Materiality: Group
financial statements
as a whole
£3.3m (2022: £3.0m)
4.9% (2022: 4.8%) of normalised profit before tax,
normalised to exclude this year’s non-underlying items
Coverage 86% (2022: 85%) of total profits and losses that made up
Group profit before tax including continuing operations
only
Key audit matters vs 2022
Recurring risks Recoverability of parent company’s
investments in subsidiaries
◄►
New Recoverability of goodwill ◄►
2. KEY AUDIT MATTERS: OUR ASSESSMENT OF RISKS OF
MATERIAL MISSTATEMENT
Key audit matters are those matters that, in our professional judgement, were
of most significance in the audit of the financial statements and include the
most significant assessed risks of material misstatement (whether or not due
to fraud) identified by us, including those which had the greatest effect on: the
overall audit strategy; the allocation of resources in the audit; and directing the
efforts of the engagement team. We summarise below the key audit matters
unchanged from 2022, in decreasing order of audit significance, in arriving at
our audit opinion above, together with our key audit procedures to address
those matters and, as required for public interest entities, our results from
those procedures. These matters were addressed, and our results are based
on procedures undertaken, in the context of, and solely for the purpose of,
our audit of the financial statements as a whole, and in forming our opinion
thereon, and consequently are incidental to that opinion, and we do not
provide a separate opinion on these matters.
RECOVERABILITY OF GOODWILL
(Goodwill: £100.5m; 2022: £118.1m)
Refer to page 94 (Audit Committee report), page 166 (accounting policy) and
pages 140 and 141 (financial disclosures).
THE RISK
Forecast-based assessment
A history of business combinations results in significant Group goodwill. We
determined that the forecast future cash flows used in calculating the value in
use of each CGU involves a degree of estimation uncertainty, with a potential
range of reasonable outcomes greater than our materiality for the financial
statements as a whole, and possibly many times that amount. The estimated
recoverable amount of the Group is subjective due to inherent uncertainty
involved in forecasting and discounting future cash flows for CGUs.
Our response
We performed the tests below rather than seeking to rely on any of the
Group’s controls because the nature of the balance is such that we would
expect to obtain audit evidence primarily through the detailed procedures
described. Our procedures included:
- Historical comparisons: We challenged the cash flow forecasts by comparing
historical projections to actual results to assess the Group’s ability to
accurately forecast;
- Our sector experience: We evaluated assumptions used, in particular
thoserelating to operating cash flow forecasts when compared with our
business understanding;
- Benchmarking assumptions: We benchmarked discount rates (including
theunderlying assumptions used) against market data, including publicly
available analysts’ reports and peer comparison using input from our own
valuation specialists;
- Sensitivity analysis: We performed sensitivity analysis by reviewing the impact
of reasonable downward changes to the assumptions noted above;
- Comparing valuations: We compared the sumof the discounted cash flows
to the aggregate of the Group’s market capitalisation and the fair value of the
net debt to assess the reasonableness of those cash flows; and
- Assessing transparency: We assessed whether the Group’s disclosures about
the estimation uncertainty related to the impairment assessment reflect the
risks inherent in the valuation of goodwill.
Our results
We found the goodwill balance, and the related impairment charge, to be
acceptable (2022 result: acceptable).
RECOVERABILITY OF PARENT COMPANY’S INVESTMENTS IN SUBSIDIARIES
(Investments in subsidiaries: £786.0m; 2022: £766.6m)
Refer to page 94 (Audit Committee report), page 166 (accounting policy) and
page 162 (financial disclosures).
THE RISK
Forecast-based assessment
The carrying amount of the parent company’s investments in subsidiaries are
significant and at risk of irrecoverability due to changes in product demand and
forecast cash flows. The estimated recoverable amount of these balances is
subjective due to the inherent uncertainty involved in forecasting and
discounting future cash flows.
The effect of these matters is that, as part of our risk assessment, we
determined that the recoverable amount of the cost of investment in
subsidiaries has a high degree of estimation uncertainty, with a potential
rangeof reasonable outcomes greater than our materiality for the financial
statements as a whole, and possibly many times that amount. Note 2 to the
parent company financial statements discloses the sensitivity estimated by the
parent company.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 173

2. KEY AUDIT MATTERS: OUR ASSESSMENT OF RISKS OF
MATERIAL MISSTATEMENT continued
Our response
We performed the tests below rather than seeking to rely on any of the
Group’s controls because the nature of the balance is such that we would
expect to obtain audit evidence primarily through the detailed
proceduresdescribed. Our procedures included:
- Historical comparisons: We challenged the cash flow forecasts by comparing
historical projections to actual results to assess the Group’s ability to
accurately forecast;
- Our sector experience: We evaluated assumptions used, in particular
thoserelating to operating cash flow forecasts when compared with our
business understanding;
- Benchmarking assumptions: We benchmarked discount rates (including
theunderlying assumptions used) against market data, including publicly
available analysts’ reports and peer comparison using input from our own
valuation specialists;
- Sensitivity analysis: We performed sensitivity analysis by reviewing the
impactof reasonable downward changes to the assumptions noted above;
- Comparing valuations: We compared the carrying amount of the
investments with the expected value of the business based onthe Group’s
market capitalisation and the fair value of the net debt; and
- Assessing transparency: We assessed whether the parent company’s
disclosures about the estimation uncertainty related to the impairment
assessment reflect the risks inherent in the recoverability of the parent
company’s investments in subsidiaries.
Our results
We found the parent company’s conclusion that there is no impairment of
investment in subsidiaries to be acceptable (2022 result: impairment charge
was found to be balanced).
3. OUR APPLICATION OF MATERIALITY AND AN OVERVIEW
OFTHESCOPE OF OUR AUDIT
Materiality for the Group financial statements as a whole was set at £3.3m
(2022: £3.0m), determined with reference to a benchmark of Group profit
before tax, normalised to exclude non-underlying items as disclosed in note 3
to the Group financial statements, of which it represents 4.9% (2022: 4.8%).
We adjusted for these items because they do not represent the normal,
continuing operations of the group.
Materiality for the parent company financial statements as a whole was set at
£3m (2022: £1.5m) determined with reference to a benchmark of parent
company total assets, of which it represents 0.4% (2022: 0.2%).
In line with our audit methodology, our procedures on individual account
balances and disclosures were performed to a lower threshold, performance
materiality, so as to reduce to an acceptable level the risk that individually
immaterial misstatements in individual account balances add up to a material
amount across the financial statements as a whole.
Performance materiality was set at 75% (2022: 75%) of materiality for the
financial statements as a whole, which equates to £2.47m (2022: £2.25m) for
the Group and £2.25m (2022: £1.13m) for the parent company. We applied
this percentage in our determination of performance materiality because we
did not identify any factors indicating an elevated level of risk.
Normalised profit before tax
Group materiality
NORMALISED PROFIT BEFORE TAX
£67.8m (2022: £62.5m)
GROUP MATERIALITY
£3.3m (2022: £3.0m)
£3.3m
Whole financial statements
materiality (2022: £3.0m)
£165k
Misstatements reported to
the Audit Committee
(2022: £150k)
£2.47m
Whole financial statements
performance materiality
(2022: £2.25m)
£2.4m
Range of materiality at ten
components (£1.2m–£2.4m)
(2022: £0.9m–£1.8m)
Full scope for Group audit purposes 2023
Specified risk-focused audit procedures 2023
Residual components 2023
 Full scope for Group audit purposes 2022
Specified risk-focused audit procedures 2022
Residual components 2022
GROUP REVENUE TOTAL PROFITS AND LOSSES THAT
MADE UP GROUP PROFIT BEFORE TAX
GROUP TOTAL ASSETS
73
79
68
71
14
10
16
21
70
16
82
3
We agreed to report to the Audit Committee any corrected or uncorrected
identified misstatements exceeding £165k (2022: £150k), in addition to other
identified misstatements that warranted reporting on qualitative grounds.
Of the Group’s 13 reporting components, we subjected six (2022: seven) to
full scope audits for Group purposes, and two (2022: one) to specified
risk-focused audit procedures over revenue, inventory and management override
of controls. The components for which we performed work other than audits
for Group reporting purposes were not individually significant but were included
in the scope of our Group reporting work in order to provide further
coverage over the Group’s results. We conducted analytical procedures over
the financial information at a further two (2022: three) non-significant
components in order to provide further coverage over the Group’s results.
The components within the scope of our work accounted for the percentages
illustrated below.
84%
(2022: 87%)
92%
(2022: 89%)
86%
(2022: 85%)
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CHEMRING GROUP PLC continued
Chemring Group PLC Annual report and accounts 2023174

3. OUR APPLICATION OF MATERIALITY AND AN OVERVIEW
OFTHESCOPE OF OUR AUDIT continued
The remaining 16% (2022: 13%) of total Group revenue and 14% (2022: 15%)
of total profits and losses that made up Group profit before tax is represented
by three components. None of these three components individually represented
more than 7% (2022: 8%) of any of total Group revenue or total profits and
losses that made up Group profit before tax. The remaining 8% (2022: 11%)
of total Group assets is represented by four (2022: three) components none
of which individually represented more than 4% (2022: 7%) of total Group
assets. For these residual components, we performed analysis at an aggregated
Group level to re-examine our assessment that there were no significant risks of
material misstatement within these.
The Group team instructed component auditors as to the significant areas to
be covered, including the relevant risks detailed above and the information to
be reported back. The Group team approved the component materialities
which ranged from £1.2m to £2.4m (2022: £0.9m to £1.8m), having regard to
the mix of size and risk profile of the Group across the components. The work
on 6 of the 13 (2022: 7 of the 14) components was performed by component
auditors and the rest, including the audit of the parent company, was performed
by the Group team. The Group team performed procedures on the items
excluded from normalised profit before tax.
The Group team visited four (2022: four) component locations in the UK
andUS (2022: UK and US), to assess the audit risk and strategy. Video and
telephone conference meetings were also held with these component auditors
and all others that were not physically visited. At these visits and meetings, the
findings reported to the Group team were discussed in more detail, and any
further work required by the Group team was then performed by the
component auditor. The Group team also inspected the component audit
team’s key workpapers.
We were able to rely upon the Group’s internal control over financial reporting
in several areas of our audit, where our controls testing supported this approach,
which enabled us to reduce the scope of our substantive audit work; in the
other areas the scope of the audit work performed was fully substantive.
4. THE IMPACT OF CLIMATE CHANGE ON OUR AUDIT
In planning our audit, we considered the potential impacts of climate change
on the Group’s business and its financial statements, based on our knowledge
of the Group’s operations and their stated strategy with respect to climate change.
THE CONTEXT OF CLIMATE CHANGE FOR THE GROUP
Climate change impacts the Group in a variety of ways including the impact of
climate risk on manufacturing and procurement, potential reputational risk
associated with the Group’s delivery of its climate-related initiatives, and greater
emphasis on climate-related narrative and disclosure in the annual report.
The Group’s exposure to climate change is primarily through environmental
factors impacting the safety of the sites across the Group, including wildfires in
Australia and hurricanes in the US. As part of our audit we have made enquiries
of management to understand the extent of the potential impact of climate
change risk on the Group’s financial statements and the Group’s preparedness
for this.
The Group emits greenhouse gases directly from energy used in its production
operations. As explained on page 44 of the Group’s annual report, the Group is
working toward targets to reduce scope 1 and 2 carbon emissions to become
net zero (scope 1 and scope 2 market-based) by 2030 and then working
towards being a scope 3 net zero organisation by 2050.
THE GROUP’S ASSESSMENT OF ACCOUNTING CONSEQUENCES
IFRS requires the Group’s financial reporting to be based, amongst other
things, on the Group’s best estimate of assumptions that are reasonable and
supportable as at the date of reporting. Those assumptions may not align with
the ways in which the global economy, society and government policies will
need to change to meet the relevant targets.
The Group has set carbon emissions targets and estimated the incremental
capital and operational expenditure required to deliver those targets. The Group
has considered the potential for asset obsolescence or shorter economic lives
of its existing property, plant and equipment, and this does not result in any
material changes to accounting estimates as a result.
The Group has provided more detail on how it has considered climate change
in its financial reporting on page 172 of the Group’s financial statements.
OUR AUDIT RESPONSE
Risk assessment procedures
As part of our risk assessment procedures, we made enquiries, with the
assistance of our climate change professionals, of key members of
management. Our enquiries focused on understanding the Group’s climate-
related strategy and identifying those areas where climate change could have a
potential material impact on the financial statements. We did not identify the
impact of climate risk as a separate Key Audit Matter in our audit given the
nature of the Group’s operations and knowledge gained of its impact on
significant accounting estimates and judgements during our risk assessment
procedures and testing.
Audit procedures in relation to Key Audit Matters
We did not consider the impact of climate change to be significant to our audit
response for the Key Audit Matters relating to recoverability of goodwill and
the parent company’s investments in subsidiaries. On the basis of our risk
assessment, we determined that while climate change poses a risk to the
determination of future cash flows, the risk to this year’s financial statements
from climate change alone is not significant taking into account the extent of
headroom available on the cash-generating units. As such, there was no impact
on our key audit matters.
Other audit procedures
During the course of our audit, we carried out the following additional
auditprocedures:
- we considered the Group’s processes around climate change-related
disclosures in the annual report and read the disclosures in the strategic
report and directors’ report and considered its consistency with the financial
statements and our audit knowledge; and
- we assessed the appropriateness of climate-related financial disclosures,
including TCFD recommended disclosures.
The audit procedures were performed by the Group engagement team with
the support of our climate change professionals.
5. GOING CONCERN
The directors have prepared the financial statements on the going concern
basis as they do not intend to liquidate the Group or the Company or to cease
their operations, and as they have concluded that the Group’s and the Company’s
financial position means that this is realistic. They have also concluded that
there are no material uncertainties that could have cast significant doubt over
their ability to continue as a going concern for at least a year from the date of
approval of the financial statements (the ”going concern period”).
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 175

5. GOING CONCERN continued
We used our knowledge of the Group, its industry, and the general economic
environment to identify the inherent risks to its business model and analysed
how those risks might affect the Group’s and parent company’s financial
resources or ability to continue operations over the going concern period.
Therisks that we considered most likely to adversely affect the Group’s and
parent company’s available financial resources, EBITDA and net debt covenants
over this period were:
- delays to significant revenue contracts;
- manufacturing facility safety incidents causing business interruption; and
- the potential outcome of the provisions and contingent liabilities related to
regulatory investigations.
We considered whether these risks could plausibly affect the liquidity or
covenant compliance in the going concern period by assessing the directors’
sensitivities over the level of available financial resources and covenant
thresholds indicated by the Group’s financial forecasts taking account of
severe, but plausible, adverse effects that could arise from these risks
individually and collectively.
We also assessed completeness of the going concern disclosure.
Our conclusions based on this work:
- We consider that the directors’ use of the going concern basis of accounting
in the preparation of the financial statements is appropriate;
- we have not identified, and concur with the directors’ assessment that there
is not, a material uncertainty related to events or conditions that, individually
or collectively, may cast significant doubt on the Group’s or Company’s
ability to continue as a going concern for the going concern period;
- we have nothing material to add or draw attention to in relation to the
directors’ statement in note 1 to the financial statements on the use of the
going concern basis of accounting with no material uncertainties that may
cast significant doubt over the Group and Company’s use of that basis for
the going concern period, and we found the going concern disclosure in page
77 to be acceptable; and
- the related statement under the Listing Rules set out on page 125 is
materially consistent with the financial statements and our audit knowledge.
However, as we cannot predict all future events or conditions and as
subsequent events may result in outcomes that are inconsistent with
judgements that were reasonable at the time they were made, the above
conclusions are not a guarantee that the Group or the Company will
continuein operation.
6. FRAUD AND BREACHES OF LAWS AND REGULATIONS –
ABILITYTO DETECT
IDENTIFYING AND RESPONDING TO RISKS OF MATERIAL
MISSTATEMENT DUE TO FRAUD
To identify risks of material misstatement due to fraud (“fraud risks”) we
assessed events or conditions that could indicate an incentive or pressure to
commit fraud or provide an opportunity to commit fraud. Our risk assessment
procedures included:
- Enquiring of directors and internal audit and inspection of policy
documentation as to the Group’s high-level policies and procedures to
prevent and detect fraud, including the internal audit function, and the
Group’s channel for “whistleblowing”, as well as whether they have
knowledge of any actual, suspected, or alleged fraud;
- reading Board, Audit Committee, Executive Committee, Remuneration
Committee and Risk Committee meeting minutes;
- considering remuneration incentive schemes and performance targets
formanagement and directors including the EPS target for management
remuneration; and
- using analytical procedures to identify any unusual or unexpected relationships.
We communicated identified fraud risks throughout the audit team and
remained alert to any indications of fraud throughout the audit. This included
communication from the Group audit team to in-scope component audit
teams of relevant fraud risks identified at the Group level and request to full
scope component audit teams to report to the Group audit team any instances
of fraud that could give rise to a material misstatement at Group level.
As required by auditing standards and taking into account possible pressures to
meet profit targets, we perform procedures to address the risk of management
override of control, in particular the risk that Group and component management
may be in a position to make inappropriate accounting entries, and the risk of
bias in accounting estimates and judgements including recoverability of
goodwill and recoverability of parent Company investments in subsidiaries as
detailed in section 2 of this report. On this audit, we do not believe there is a
fraud risk related to revenue recognition because there are no complexities or
significant areas of estimation within the revenue recognition.
We did not identify any additional fraud risks.
We performed procedures including:
- identifying journal entries and other adjustments to test for all in-scope
components based on risk criteria and comparing the identified entries
tosupporting documentation. These included those posted to unusual
accounts; and
- assessing whether the judgements made in making significant accounting
estimates are indicative of potential bias.
IDENTIFYING AND RESPONDING TO RISKS OF MATERIAL
MISSTATEMENT DUE TO NON-COMPLIANCE WITH LAWS
ANDREGULATIONS
We identified areas of laws and regulations that could reasonably be expected
to have a material effect on the financial statements from our general commercial
and sector experience, through discussion with the directors (as required by
auditing standards) and from inspection of the Group’s regulatory and legal
correspondence and discussed with the directors the policies and procedures
regarding compliance with laws and regulations.
As the Group is regulated, our assessment of risks involved gaining an
understanding of the control environment including the entity’s procedures
forcomplying with regulatory requirements.
We communicated identified laws and regulations throughout our team and
remained alert to any indications of non-compliance throughout the audit.
This included communication from the Group audit team to component audit
teams of relevant laws and regulations identified at the Group level, and a
request for component auditors to report to the Group team any instances
ofnon-compliance with laws and regulations that could give rise to a material
misstatement at Group level.
The potential effect of these laws and regulations on the financial statements
variesconsiderably.
Firstly, the Group is subject to laws and regulations that directly affect the
financial statements including financial reporting legislation (including related
companies legislation), distributable profits legislation, taxation legislation and
pension legislation, and we assessed the extent of compliance with these laws
and regulations as part of our procedures on the related financial statement items.
Secondly, the Group is subject to many other laws and regulations where the
consequences of non-compliance could have a material effect on amounts or
disclosures in the financial statements, for instance through the imposition of
fines or litigation. We identified the following areas as those most likely to have
such an effect: health and safety, environmental protection legislation, and
anti-bribery and corruption, recognising the regulated nature of the Group’s
activities and its legal form. Auditing standards limit the required audit procedures
to identify non-compliance with these laws and regulations to enquiry of the
directors and inspection of regulatory and legal correspondence, if any.
Therefore if a breach of operational regulations is not disclosed to us or
evident from relevant correspondence, an audit will not detect that breach.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CHEMRING GROUP PLC continued
Chemring Group PLC Annual report and accounts 2023176

6. FRAUD AND BREACHES OF LAWS AND REGULATIONS –
ABILITYTO DETECT continued
IDENTIFYING AND RESPONDING TO RISKS OF MATERIAL
MISSTATEMENT DUE TO NON-COMPLIANCE WITH LAWS
ANDREGULATIONS continued
For the Health and Safety Executive matter discussed in note 33, we assessed
disclosures against our understanding from legal correspondence, including
discussions held with the lawyers as well as inspection of relevant documentation.
CONTEXT OF THE ABILITY OF THE AUDIT TO DETECT FRAUD
ORBREACHES OF LAW OR REGULATION
Owing to the inherent limitations of an audit, there is an unavoidable risk
thatwe may not have detected some material misstatements in the financial
statements, even though we have properly planned and performed our audit
in accordance with auditing standards. For example, the further removed
non-compliance with laws and regulations is from the events and transactions
reflected in the financial statements, the less likely the inherently limited procedures
required by auditing standards would identify it.
In addition, as with any audit, there remained a higher risk of non-detection
offraud, as these may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal controls. Our audit procedures
are designed to detect material misstatement. We are not responsible for
preventing non-compliance or fraud and cannot be expected to detect
non-compliance with all laws and regulations.
7. WE HAVE NOTHING TO REPORT ON THE OTHER
INFORMATION IN THE ANNUAL REPORT
The directors are responsible for the other information presented in the
annual report together with the financial statements. Our opinion on the
financial statements does not cover the other information and, accordingly,
wedo not express an audit opinion or, except as explicitly stated below, any
form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider
whether, based on our financial statements audit work, the information therein
is materially misstated or inconsistent with the financial statements or our audit
knowledge. Based solely on that work we have not identified material misstatements
in the other information.
STRATEGIC REPORT AND DIRECTORS’ REPORT
Based solely on our work on the other information:
- we have not identified material misstatements in the strategic report
andthedirectors’ report;
- in our opinion the information given in those reports for the financial
yearisconsistent with the financial statements; and
- in our opinion those reports have been prepared in accordance with
theCompanies Act 2006.
DIRECTORS’ REMUNERATION REPORT
In our opinion the part of the directors’ remuneration report to be audited
has been properly prepared in accordance with the Companies Act 2006.
DISCLOSURES OF EMERGING AND PRINCIPAL RISKS AND
LONGER-TERM VIABILITY
We are required to perform procedures to identify whether there is a
material inconsistency between the directors’ disclosures in respect of
emerging and principal risks and the viability statement, and the financial
statements and our audit knowledge.
Based on those procedures, we have nothing material to add or draw
attention to in relation to:
- the directors’ confirmation, on page 68, that they have carried out a robust
assessment of the emerging and principal risks facing the Group, including
those that would threaten its business model, future performance, solvency,
and liquidity;
- the principal risks and uncertainties disclosures describing these risks and
how emerging risks are identified, and explaining how they are being
managed and mitigated; and
- the directors’ explanation in the viability statement of how they have
assessed the prospects of the Group, over what period they have done so
and why they considered that period to be appropriate, and their statement
as to whether they have a reasonable expectation that the Group will be
able to continue in operation and meet its liabilities as they fall due over the
period of their assessment, including any related disclosures drawing
attention to any necessary qualifications or assumptions.
We are also required to review the viability statement, set out on page 77
under the Listing Rules. Based on the above procedures, we have concluded
that the above disclosures are materially consistent with the financial
statements and our audit knowledge.
Our work is limited to assessing these matters in the context of only the
knowledge acquired during our financial statements audit. As we cannot
predict all future events or conditions and as subsequent events may result in
outcomes that are inconsistent with judgements that were reasonable at the
time they were made, the absence of anything to report on these statements
is not a guarantee as to the Group’s and Company’s longer-term viability.
CORPORATE GOVERNANCE DISCLOSURES
We are required to perform procedures to identify whether there is a
material inconsistency between the directors’ corporate governance
disclosures and the financial statements and our audit knowledge.
Based on those procedures, we have concluded that each of the following is
materially consistent with the financial statements and our audit knowledge:
- the directors’ statement that they consider that the annual report and
financial statements taken as a whole is fair, balanced and understandable,
and provides the information necessary for shareholders to assess the
Group’s position and performance, business model and strategy;
- the section of the annual report describing the work of the Audit
Committee, including the significant issues that the audit committee
considered in relation to the financial statements, and how these issues
wereaddressed; and
- the section of the annual report that describes the review of the
effectiveness of the Group’s risk management and internal control systems.
We are required to review the part of the corporate governance statement
relating to the Group’s compliance with the provisions of the UK Corporate
Governance Code specified by the Listing Rules for our review. We have
nothing to report in this respect.
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 177

8. WE HAVE NOTHING TO REPORT ON THE OTHER MATTERS
ONWHICH WE ARE REQUIRED TO REPORT BY EXCEPTION
Under the Companies Act 2006, we are required to report to you if, in
ouropinion:
- adequate accounting records have not been kept by the parent company, or
returns adequate for our audit have not been received from branches not
visited by us; or
- the parent company financial statements and the part of the directors’
remuneration report to be audited are not in agreement with the accounting
records and returns; or
- certain disclosures of directors’ remuneration specified by law are not made; or
- we have not received all the information and explanations we require for
ouraudit.
We have nothing to report in these respects.
9. RESPECTIVE RESPONSIBILITIES
DIRECTORS’ RESPONSIBILITIES
As explained more fully in their statement set out on page 125, the directors
are responsible for: the preparation of the financial statements including being
satisfied that they give a true and fair view; such internal control as they
determine is necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error; assessing
the Group and parent company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern; and using the going
concern basis of accounting unless they either intend to liquidate the Group or
the parent company or to cease operations, or have no realistic alternative but
to do so.
AUDITOR’S RESPONSIBILITIES
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue our opinion in an auditor’s report. Reasonable
assurance is a high level of assurance but does not guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of
the financial statements.
A fuller description of our responsibilities is provided on the FRC’s website at
www.frc.org.uk/auditorsresponsibilities.
The Company is required to include these financial statements in an annual
financial report prepared using the single electronic reporting format specified
in the TD ESEF Regulation. This auditor’s report provides no assurance over
whether the annual financial report has been prepared in accordance with
thatformat.
10. THE PURPOSE OF OUR AUDIT WORK AND TO WHOM WE
OWEOUR RESPONSIBILITIES
This report is made solely to the Company’s members, as a body, in
accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit
work has been undertaken so that we might state to the Company’s members
those matters we are required to state to them in an auditor’s report and for
no other purpose. To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone other than the Company and the Company’s
members, as a body, for our audit work, for this report, or for the opinions
we have formed.
James Childs-Clarke (Senior Statutory Auditor)
for and on behalf of KPMG LLP, Statutory Auditor
Chartered Accountants
Gateway House
Tollgate
Chandlers Ford
Southampton
SO53 3TG
12 December 2023
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CHEMRING GROUP PLC continued
Chemring Group PLC Annual report and accounts 2023178

FIVE-YEAR RECORD
For the year ended 31 October 2023
2023 2022 2021 2020 2019
£m £m £m £m £m
Revenue 472.6 401.0 351.6 351.4 297.5
Underlying EBITDA 88.5 77.3 67.7 62.7 51.5
Underlying operating profit 69.2 59.4 49.2 43.2 34.7
Non-underlying items (23.8) (10.0) (7.1) (8.4) (12.7)
Operating profit 45.4 49.4 42.1 34.8 22.0
Finance expense (1.3) (1.5) (1.6) (3.0) (4.6)
Profit before taxation 44.1 47.9 40.5 31.8 17.4
Taxation (6.4) (3.5) (5.3) (5.8) (1.3)
Profit for the year from continuing operations 37.7 44.4 35.2 26.0 16.1
(Loss)/profit after tax from discontinued operations (32.3) 3.0 6.3 8.7 5.8
Profit attributable to equity shareholders 5.4 47.4 41.5 34.7 21.9
Cash generated from continuing underlying operations 80.0 85.1 71.3 70.5 54.2
Intangible assets and property, plant and equipment 369.9 395.4 351.5 348.9 329.9
Working capital 82.3 93.9 84.4 85.1 90.5
Provisions (17.6) (18.4) (17.5) (19.0) (17.2)
Retirement benefit surplus 5.9 11.2 13.7 7.6 9.6
Net current and deferred tax liabilities (15.1) (20.8) (24.5) (16.3) (8.5)
Net debt (14.4) (7.2) (26.6) (48.2) (75.7)
Other (32.5) (36.0) (28.2) (28.5) (22.8)
Net assets employed 378.5 418.1 352.8 329.6 305.8
Financed by:
Ordinary share capital 2.8 2.8 2.8 2.8 2.8
Reserves attributable to equity shareholders 375.7 415.3 350.0 326.8 303.0
Total equity 378.5 418.1 352.8 329.6 305.8
Basic underlying earnings per ordinary share (continuing operations) 20.5p 19.0p 14.7p 12.1p 8.7p
Diluted underlying earnings per ordinary share (continuing operations) 20.0p 18.5p 14.4p 11.8p 8.6p
Basic earnings per ordinary share (continuing operations) 13.4p 15.8p 12.5p 9.2p 5.7p
Diluted earnings per ordinary share (continuing operations) 13.1p 15.4p 12.2p 9.0p 5.6p
Dividend per share 6.9p 5.7p 4.8p 3.9p 3.6p
FINANCIAL STATEMENTS
Chemring Group PLC Annual report and accounts 2023 179

HEADQUARTERS AND REGISTERED OFFICE
Roke Manor
Old Salisbury Lane
Romsey
Hampshire
SO51 0ZN
T: +44 (0)1794 463401
F: +44 (0)1794 463374
E: info@chemring.com
Website: www.chemring.com
REGISTERED NUMBER
86662
REGISTRARS
Computershare Investor Services plc
The Pavilions
Bridgwater Road
Bristol
BS13 8AE
SUBSIDIARY UNDERTAKINGS’ REGISTERED OFFICES
SUBSIDIARY UNDERTAKINGS IN ENGLAND:
Roke Manor
Old Salisbury Lane
Romsey
Hampshire
SO51 0ZN
SUBSIDIARY UNDERTAKING IN SCOTLAND:
Troon House
Ardeer Site
Stevenston
Ayrshire
KA20 3LN
SUBSIDIARY UNDERTAKINGS IN THE US:
23031 Ladbrook Drive
Dulles
Virginia
20166
SUBSIDIARY UNDERTAKING IN AUSTRALIA:
230 Staceys Road
Lara
Victoria
Australia
3212
SUBSIDIARY UNDERTAKING IN NORWAY:
Engeneveien 7
N-3475 Sætre
Norway
CORPORATE INFORMATION AND WEBSITE
Chemring Group PLC Annual report and accounts 2023180

FIND OUT MORE ONLINE
For more information about Chemring Group PLC, please visit www.chemring.com, where the latest shareholder
information can be accessed, including:
- Current share price
- Key financial information
- Financial calendar
- Shareholder services and notices
- Corporate governance
- Results and presentations
- Analysts’ forecasts
- Regulatory news
Chemring Group PLC’s 2023 annual report and accounts and the notice of the Annual General Meeting can also be
viewed and downloaded at www.chemring.com/investors.
© CHEMRING GROUP PLC 2023
The information in this document is the property of Chemring Group PLC and may not be copied or communicated
toa third party or used for any purpose, other than that for which it is supplied, without the express written consent
ofChemring Group PLC. This information is given in good faith based upon the latest information available to Chemring
Group PLC; no warranty or representation is given concerning such information, which must not be taken as establishing
any contractual or other commitment binding upon Chemring Group PLC or any of its subsidiary or associated companies.
Chemring’s commitment to environmental issues is reflected in this Annual Report,
which has been printed on Magno Satin, an FSC
®
certified material. This document
was printed by Park Communications using its environmental print technology, which
minimises the impact of printing on the environment, with 99% of dry waste diverted
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OTHER INFORMATION

CHEMRING GROUP PLC
Roke Manor
Old Salisbury Lane
Romsey
Hampshire SO51 0ZN
United Kingdom
Tel: +44 (0)1794 463401
Email: info@chemring.com
www.chemring.com