REG-Keller Group Plc: Annual Financial Report
08/04/2025 14:45
8 April 2025
Keller Group plc
Annual Report and Accounts for the year ended 31 December 2024 and Notice of
2025 Annual General Meeting
Keller Group plc (“Keller”, the “Company”) announces that its Annual
General Meeting will be held at 10.00am on Wednesday 14 May 2025 (“AGM
2025”) at 4 Kingdom Street, Paddington Central, London W2 6BD.
In connection with this, the following documents have been posted or otherwise
made available to shareholders:
· Annual Report and Accounts for the year ended 31 December 2024
("Annual Report 2024")
· Notice of AGM 2025
· Proxy Form (for shareholders on the register of members)
· Form of Direction (for employee shareholders)
· Notice of Availability
In compliance with Listing Rule 9.6.1R, copies of these documents have been
submitted, where appropriate, to the National Storage Mechanism via the FCA's
Electronic Submission System and will shortly be available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
We have also submitted the Annual Report 2024 in the electronic reporting
format required by Disclosure Guidance and Transparency Rule (“DGTR”)
4.1.14R; and the Annual Report 2024 and the Notice of AGM 2025 are now
available to view on the Investors section of the Company's website at
Investor centre | Keller Group plc (https://investors.keller.com/).
The Board is keen to ensure that shareholders are able to exercise their right
to participate in the meeting. Details on how to submit a proxy vote
electronically, by post, online through CREST or Proxymity are set out in the
Notice of AGM 2025.
Should shareholders wish to ask any questions of the Board relating to the
business of the AGM 2025, they are encouraged to email their questions in
advance to secretariat@keller.com or send them by post to the Company's
registered office for the attention of the Company Secretary.
In accordance with DGTR 6.3.5R, this announcement contains information in the
Appendix about the principal risks and uncertainties, the Directors’
responsibility statement and note 29 to the accounts on related party
transactions. This information has been extracted in full unedited text from
the Annual Report 2024. This material should be read in conjunction with and
is not a substitute for reading the full Annual Report 2024. References to
page numbers and notes in the Appendix refer to those in the Annual Report
2024. A condensed set of financial statements was appended to the Keller's
preliminary results announcement issued on 4 March 2025.
For further information, please contact:
Keller Group plc www.keller.com
Silvana Glibota-Vigo, Group Head of Secretariat 020 7616 7575
Notes to editors:
Keller is the world's largest geotechnical specialist contractor providing a
wide portfolio of advanced foundation and ground improvement techniques used
across the entire construction sector. With around 10,000 staff and operations
across five continents, Keller tackles an unrivalled 5,500 projects every
year, generating annual revenue of c£3bn.
LEI number: 549300QO4MBL43UHSN10
DGTR 6 Annex 1 Classification: 1.1 (Annual financial and audit
reports)
Appendix
Principal risks and uncertainties
We list on the following pages the principal risks and uncertainties as
determined by the Board that may affect the Group and highlight the mitigating
actions that are being taken. The content of the table, however, is not
intended to be an exhaustive list of all the risks and uncertainties that may
arise.
What we review when assessing our principal and key risks:
Risk ownership Each risk has a named owner. Risk velocity Measuring how quickly the risk reaches its impact assessment in the event the risk crystallises.
In addition, each principal risk is sponsored by a member of the Executive Committee, who drives progress.
Likelihood and impact Managed through a globally applied five-by-five scoring matrix. Mitigating actions Further controls and mitigating activities required to further mitigate likelihood or impact of the risk.
Net risk After mitigating controls are taken into account. Strategic levers Capturing the impact on the Group’s strategic levers and interdependencies between principal risks.
Risk appetite Defined at a risk category level and split into five levels. Emerging risks Any relevant emerging risks where the principal risk is impacted captured under medium and long-term assessed risks.
All principal risks are detailed in a standardised format. This ensures an
effective and consistent review, understanding, monitoring and reporting
throughout the Group, both in the terminology and the assessment itself. The
top-down process includes a rigorous review by both the Executive Committee
and the Board twice a year. The bottom-up process includes at least quarterly
reviews facilitated by the Group Head of Risk and Internal Audit at a business
unit level across the Group. In addition, deep dive reviews are conducted as
required with results fed into respective reviews.
Financial risk
1. Inability to finance our business
Risk owner – Chief Financial Officer
Link to strategy: 3, 4 Timeframe: Medium and Long term Link to viability: Yes Reduced facility headroom Description and impact Failure to sufficiently and effectively manage the financial strength of the Group could lead it to: * Fail to meet required tests that allow it to continue to use the going concern basis in preparing its financial statements. Causes Failure to accurately forecast material exposures and/or manage the financial resources of the
* Fail to meet financial covenant tests, potentially leading to a default event. Group.
* Have a lack of available funds, restricting investment in growth opportunities, whether through acquisition or innovation.
* Be unable to meet dividend payment requirements.
Mitigation and internal controls * Centralised Treasury function that is responsible for managing key financial risks, including liquidity and credit capacity. Movement since 2023 Reduced Risk New seven-year £400m RCF secured (initial five years with two one
* Mixture of long-term committed debt with varying maturity dates which comprise a £400m revolving credit facility maturing in 2031 and a US private placement debt of $300m, with $120m maturing in 2030 and $180m maturing in 2033. -year extensions), along with continued strong operational performance throughout 2024, demonstrate
* The Group maintains significant undrawn facilities within a high-quality RCF bank syndicate, which underpins the liquidity requirements of the Group. clear ability to manage both existing and future risks. The $75m US private placement, which matured
* Strong free cash flow profile – flexibility on capital expenditure and ability to reduce dividends. in December 2024, was paid down from existing facilities.
* Embedded procedures to monitor the effective management of cash and debt, including weekly cash reports and regular cash flow forecasting to ensure compliance with borrowing limits and lender covenants.
* Culture focused on actively managing our working capital and monitoring external factors that may affect funding availability.
Market risk
2. A rapid downturn in our markets
Risk owner – Chief Financial Officer
Link to strategy: 1, 2 Timeframe: Medium and Long term Link to viability: Yes Revenue decline Description and impact Inability to maintain a sustainable level of financial performance throughout Causes * Customers postponing or reducing investment in ongoing and new projects at short notice.
the construction industry market cycle, which grows more than many other industries during periods of * Impact of increasing inflation, especially in steel, cement and energy.
economic expansion and falls harder than many other industries when the economy contracts. Any * Political instability leading to disruption in supply chains impacting both availability and price.
significant, sustained reduction in the level of customer activity could adversely affect the Group’s
strategy, reducing revenue and profitability in the short and medium term, and negatively impact the
longer-term viability of the Group.
Mitigation and internal controls * The diverse markets in which the Group operates, both in terms of Movement since 2023 Constant Risk The Group continues to maintain a very strong order book across all divisions at near record levels. Inflation and interest rate risk is now beginning to abate in Keller’s key markets. Geopolitical uncertainty continues both due to the conflicts in Ukraine and Gaza, plus elections in many of Keller’s key markets.
geography and market segment, provide protection to individual geographic or segment slowdowns.
* Leveraging the global scale of the Group, talent and resources can be redeployed to other parts of
the company during individual market slowdowns.
* Having strong local businesses with in-depth knowledge of the local markets enables early detection
and response to market trends.
* The diverse customer base, with no single customer accounting for more than 4% of Group revenue,
reduces the potential impact of individual customer failure caused by an economic downturn.
Strategic risks
3. Losing our market share
Risk owner – Chief Financial Officer
Link to strategy: 1, 2 Timeframe: Short, Medium, and Long-term Link to viability: Yes Revenue decline Description and impact Inability to achieve sustainable growth, whether through organic growth acquisition, new products, new geographies or industry-specific solutions, may: * Jeopardise our position as the preferred international geotechnical specialist contractor. Causes * Increased competitor activity especially in tight or contracting markets.
* Lead to inefficiencies and increased operating costs, which in turn could impact our ability to deliver balanced profitable growth, which is a key component of our strategy. * Failure to adjust to changing customer demands or fully understand and meet their requirements.
* Failure to deliver on our key strategic objective may result in the loss of confidence and trust of our key stakeholders including investors, financial institutions and customers. * Inability to identify changes in market demands, including changes to promote sustainability.
Mitigation and internal controls * A clear business strategy with defined short, medium and long-term objectives, which is monitored at local, divisional and Group level. Movement since 2023 Constant Risk We continued to see strong improvement across the US in 2024,
* Continued analysis of existing and target markets to ensure opportunities that they offer are understood. where we continue to provide a wider range of our products across more locations following the
* An opportunities pipeline covering all sectors of the construction market. successful execution of the One Keller project. This focus is also showing success in the other
* A wide-ranging local branch network which facilitates customer relationships and helps secure repeat work. divisions as they diversify their available product range to maintain and grow our market share.
* Continually seeking to differentiate our offering through service quality, value for money and innovation.
* North American businesses reorganisation delivering on cross-selling opportunities.
* Minimising the risk of acquisitions, including getting to know a target company in advance to understand the operational and cultural differences and potential synergies, as well as undertaking these through due diligence and structured and carefully managed integration plans.
4. Ethical misconduct and non-compliance with regulations
Risk owner – Company Secretary
Link to strategy: 3, 4 Timeframe: Short term Link to viability: Yes One-off costs Description and impact Keller operates in many different jurisdictions Causes Failure to comply with the Code of Business Conduct or related policies and procedures could stem from: * Failure to establish a robust corporate culture.
and is subject to various rules, regulations and other legal requirements * Failure to adopt a compliance risk approach.
including those related to anti-bribery and anti-corruption. Failure to * Failure to embed the Group’s values and behaviours across the entire organisation, including any joint ventures.
comply with the Code of Business Conduct or other regulations could leave * Failure to have a robust training and monitoring programme in place.
the Group exposed to: * Instances of bribery and corruption. * Inadequate due diligence in M&A process.
* Fraud and deception. * Deliberate non-compliance.
* Human rights abuses, such as modern slavery, child labour abuses and
human trafficking.
* Unfair competition practices.
* Unethical treatment within our supply chain.
This could also apply to M&A activity in relation to past deeds of
acquired companies. These failures could result in legal investigations,
leading to fines and penalties, reputational damage and business losses.
Mitigation and internal controls * A Code of Business Conduct that sets out minimum expectations for all colleagues in respect of ethics, integrity and regulatory requirements, that is updated annually and is backed by a training programme to ensure that it is fully embedded across the Group. Movement since 2023 Constant Risk
* Ethics and Compliance Officers in every business unit who support the ethics and compliance culture and ensure best practice developed by the Group is communicated and embedded into local business practices.
* Regular workshops across the Group to ensure compliance risks are identified and addressed.
* Ethics and compliance updates to the Audit and Risk Committee semi-annually.
* A Group M&A standard that sets out the approach and process to be followed for any M&A activity.
* An independent third-party whistleblowing helpline that is actively promoted. Complaints are independently investigated by the Compliance and Internal Audit teams and appropriate action taken where necessary.
5. Inability to maintain our technological product advantage
Risk owner – Chief Construction Officer
Link to strategy: 1, 2 Timeframe: Medium and Long-term Link to viability: No Description and impact Keller has a history of innovation that has given Causes * Failure to maintain investment in innovation and digitisation.
us a technological advantage which is recognised by our clients and * Increased competitor investment in innovative solutions.
competitors. Failure to maintain this advantage through the continued * Failure to continue to invest in our people.
technological advancements in our equipment, products and solutions may:
* Impact our position in the market.
* Result in us not being selected for key complex, high-value projects
that support the Group strategy.
* Result in the loss of reputation for delivering the best engineered
solutions.
Mitigation and internal controls * Innovation initiatives developed at both Group and divisional level to ensure a structured approach to innovation is in place across the Group. Movement since 2023 Constant risk
* Innovation in low-carbon materials (cement, concrete, cement-free binders), by carrying out field trials and collaborating with cement suppliers and other companies innovating in this space.
* Digitisation initiatives focusing on strategy of facilitating equipment and operational data capture.
* We take a leadership role in the geotechnical industry, with many of our team playing key roles in professional associations and industry activities around the world.
* Global product teams set standards, provide guidance and disseminate best practice across the Group.
* Continued investment in both external and internal equipment manufacture.
6. Climate change
Risk owner – Chief Sustainability Officer
Link to strategy: 1, 2, 3, 4 Timeframe: Short, Medium, and Long-term Link to viability: Yes One-off costs Description and impact Climate change is a global threat and failure to manage and mitigate it could Causes * Failure to update product and equipment offerings in line with both legislation and customer demand.
lead to: * An inability to achieve Keller’s commitment to deliver solutions in an environmentally
conscious manner, which may in turn have a negative impact on our reputation, affect employee morale
and lead to a loss of confidence from our customers, suppliers and investors.
* Product offerings and equipment used becoming obsolete because they are no longer compliant with
environmental standards.
* Remediation of non-compliant work at our own expense to maintain compliance.
Mitigation and internal controls * Sustainability Steering Committee that is responsible for Movement since 2023 Constant Risk We are starting to win project opportunities related to climate impact. This is tempered by the introduction of more legislation relating to climate impact, eg proposed new restriction for federal construction projects in the US and CSRD in Europe. We continue to focus on delivering against our sustainability targets and
integrating sustainability targets and measures into the Group business plan to successfully drive meeting TCFD reporting requirements.
changes important to the company.
* Scope 1 and 2 carbon emissions verified by accredited external third party (Carbon Intelligence).
* Carbon calculator tool used to identify/improve carbon efficiency.
* Processes to meet TCFD requirements embedded into business-as-usual activities.
* Cross-functional working group created to understand and develop processes and procedures to meet
the Corporate Sustainability Reporting Directive (CSRD) legislation.
Operational risks
7. Ineffective management of our projects
Risk owner – Chief Construction Officer
Link to strategy: 3, 4 Timeframe: Short term Link to viability: Yes Contract margin decline Description and impact Inability to successfully deliver projects in line with the agreed customer Causes * Misinterpretation of client requirements or miscommunication of requirements by the client may lead to a poorly designed solution and consequently failure.
requirements (while maintaining satisfactory and appropriate contractual terms), site and loading * Failure to understand and engage with the customer on a balanced approach to allocation or sharing of risk in the contract.
conditions and local constraints (eg neighbouring buildings). In addition, an inadequate design of a * Failure to identify and manage risks in our projects to ensure that they are delivered on time and to budget, eg due to unforeseen ground and site conditions, weather-related delays, unavailability of key materials, workforce shortages or equipment breakdowns.
customer product and/or solution or failure to effectively manage suppliers may lead to: * Cost * Lack of comprehensive understanding of contract obligations.
overruns, contractual disputes and a failure to meet quality standards, damaging our reputation with * Inadequate resources (people, physical assets and materials).
the customer and giving rise to potential regulatory action and legal liability, ultimately impacting
financial performance.
* Delays to executing projects waiting for materials and ongoing business disruption, along with
additional costs to find alternative suppliers.
* Exposing the Group to long-term obligations including legal action and additional costs to remedy
solution failure.
Mitigation and internal controls * Ensuring we understand all of our risks throughout the Project Movement since 2023 Constant Risk Project execution in 2024 continued to maintain the improvement trend witnessed throughout 2023, which along with the work under way to create a new Project Performance Management standard will put in place better controls to ensure continued effective execution of projects across Keller. This new standard will be effective in 2025 and will be supported though a dedicated application, currently being developed.
Performance Management process and applying rigorous policies and processes to manage and monitor
risks and contract performance.
* The Group has professional commercial/contracts personnel and lawyers engaged when negotiating
contracts.
* Ensuring we have high-quality people delivering projects. Keller’s Project Management Academy and
Field Leadership Academy are designed to create project managers with a consistent skill set across
the entire organisation. The academies cover a broad range of topics including contract management,
planning, risk assessment, change management, decision-making and finance.
* Continuing to enhance our technological and operational capabilities through investment in our
product teams, project managers and our engineering capabilities.
* High-quality safety standards for operations (eg platform, cage handling), equipment standards and
fleet renewal.
* The Project Lifecycle Management (PLM) Standard aims to drive a consistent approach to project
delivery with robust controls at every project phase. This is currently being updated and will be
renamed Project Performance Management (PPM). Alongside the updated standard will be an app to support
the efficient and effective execution of projects.
* The Group has developed long-term partnerships with key suppliers, working closely with them to
understand their operations, but is not over-reliant on any single one, with an extensive network of
approved suppliers in place across the organisation to support its strategic ambitions.
* A Supply Chain Code of Business Conduct that sets out minimum expectations for all suppliers in
respect of ethics, integrity and regulatory requirements, that is updated annually.
8. Causing a serious injury or fatality to an employee or a member of the public
Risk owner – Chief HSEQ Officer
Link to strategy: 3 Timeframe: Short term Link to viability: Yes One-off costs Description and impact Failure to maintain high standards of health and safety, and an increase in serious injuries or fatalities leading to: * An erosion of trust of employees and potential clients. Causes * Inadequate risk identification, assessment and management.
* Damage to staff morale, an increase in employee turnover rates and a decrease in productivity. * Lack of clear leadership driving the safety culture.
* Threat of potential criminal prosecutions, fines, disbarring from future contract bidding and reputational damage. * Lack of employee competency.
* Conscious decision taken by employee to shortcut approved process to benefit production.
* Poorly designed processes that do not eliminate or mitigate risk.
* Lack of focus on the wellbeing and mental health of employees and JV partners.
Mitigation and internal controls * Board-led commitment to drive health and safety programmes and Movement
performance with a vision of zero harm. * An emphasis on safety leadership to ensure both HSEQ professionals since 2023 Constant Risk
and operational leaders drive implementation and sustainment of our
safety standards through ongoing site presence, using safety tours,
safety audits, safety action groups and mandatory employee training.
* Ongoing improvement of existing HSEQ systems to identify and control
known and emerging HSEQ risks, which conform to internal standards.
* Incident Management Standard and incident management software
driving a robust and consistent management process across the
organisation that ensures the cause of the incident is identified and
actions are put in place to prevent recurrence.
9. Not having the right skills to deliver
Risk owner – Chief People Officer
Link to strategy: 2, 3, 4 Timeframe: Short, Medium, and Long-term Link to viability : No Description and impact Failure to attract, develop and retain the right people could negatively impact our: * Capability to win and execute work safely and efficiently. Causes * Inability to recruit and retain strong performers.
* Ability to stay ahead of our competition. * Lack of a diverse workforce.
* Reputation and the confidence of our key stakeholders. * Failure to maintain and promote the Keller culture.
* Overheating of market causing significant increase in demand or competition for people.
* Lack of visibility of long-term pipeline for career progression resulting in existing employees
leaving the business.
* Post COVID-19 recovery driving increase in attrition or people leaving sector.
* Pressure from wage inflation and increased offers from competition.
Mitigation and internal controls * Continuing to invest in our people and organisation in line with the four pillars of the Keller People agenda as noted below. Movement since 2023 Constant Risk Inflationary pressure on pay is reducing across many locations
* Ensuring that the ‘Right Organisation’ is in place with people having clear accountabilities; each organisational unit is properly configured with a matrix of line management, functional support and product expertise. where Keller operates as inflation rates fall back to more normal levels. There are still some pockets
* As an industry leader, that Keller is made up of ‘Great People’ that are well trained, motivated and have opportunities to develop to their full potential. Project managers and field employees receive comprehensive training programmes which cover a broad range of topics including contract management, planning, risk assessment, change management, decision - making and finance. of pressure on competition for skilled personnel in some parts of Keller. However, generally, job
* A strong focus on the ‘Exceptional Performance’ of employees in delivering commercial outcomes safely for Keller based upon project successes for our customers. Business leaders are incentivised to deliver their annual financial and safety commitments to the Group. markets are beginning to show signs of a slowdown, which will hopefully ease this issue. This focus
* The ‘Keller Way’ provides guidance to the company’s employees and leaders to comply with local laws and work within Keller’s values and Code of Business Conduct. remains on retaining staff with the right skills to deliver.
10. Information Technology, cyber security and assurance
Risk owner – Chief Information Officer
Link to strategy: 3, 4 Timeframe: Short term Link to viability: No Description and impact Failure, degradation or error in IT systems or cyber security incidents could result in: * Loss of intellectual property and competitive advantage. Causes * Failure to maintain appropriate threat prevention, identification and resolution mechanisms either technically or through processes.
* Loss of personal data. * Poor internal governance.
* Operational impact restricting the ability to carry out business-critical activities. * Failure to embed preventative culture.
* Potential fines and penalties. * Lack of or inadequate training and awareness leading to mistakes and errors.
* Reputational damage leading to loss of market and customer confidence. * Inconsistent approach to data security, especially with JV partners and external third parties.
* Failure to meet client IT or security requirements to win or maintain contracts. * Cyber attacks.
* Failure to obtain or maintain external security certifications that are required by clients.
Mitigation and internal controls * The Group has a cyber security and information assurance team and is utilising zero-trust layered technology. Movement since 2023 Constant Risk
* The Group has created an Information Security Management System framework, referencing industry standards to ensure appropriate governance, control and risk management and then onward management for compliance, maturity and development of service.
* Introduction of technical capabilities and services to further enable prevention, detection, prediction and response services.
* Multi-factor authentication for all users prevents unauthorised access to Keller’s networks and applications and further controls limit access to only Keller-approved devices.
* Advanced threat protection on all IT equipment delivers comprehensive, ongoing and real-time protection against viruses, malware and spyware.
* Data protection framework to ensure compliance with the General Data Protection Regulation (GDPR) and other standards of data protection.
* Proactive threat-hunting throughout the environment.
Responsibility statement of the Directors in respect of the Annual Report and
the financial statements
We confirm that to the best of our knowledge:
* the financial statements, prepared in accordance with the applicable set of
accounting standards, give a true and fair view of the assets, liabilities,
financial position and profit or loss of the company and the undertakings
included in the consolidation as a whole; and
* the Strategic report and the Directors’ report, including content
contained by reference, includes a fair review of the development and
performance of the business and the position and performance of the company
and the undertakings included in the consolidation taken as a whole, together
with a description of the principal risks and uncertainties that they face.
The Board confirms that the Annual Report and the financial statements, taken
as a whole, are fair, balanced and understandable and provide the information
necessary for shareholders to assess the Group’s position and performance,
business model and strategy.
29 Related party transactions
Transactions between the parent, its subsidiaries and joint operations, which
are related parties, have been eliminated on consolidation. Other related
party transactions are disclosed below:
Compensation of key management personnel
The remuneration of the Board and Executive Committee, who are the key
management personnel, comprised:
2024 £m 2023 £m
Short-term employee benefits 8.5 8.2
Post-employment benefits 0.3 0.3
8.8 8.5
Other related party transactions
As at 31 December 2024, there was a net balance of £nil (2023: £0.1m) owed
by the joint venture. These amounts are unsecured, have no fixed date of
repayment and are repayable on demand.
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