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REG-Travis Perkins Travis Perkins: Publication of 2018 Annual Report

============

   Travis Perkins (TPK)
   Travis Perkins: Publication of 2018 Annual Report

   26-Feb-2019 / 16:13 GMT/BST
   Dissemination of a Regulatory Announcement, transmitted by EQS Group.
   The issuer is solely responsible for the content of this announcement.

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   Publication of the Annual Report 2018

   Further to the release of its results announcement this morning, Travis
   Perkins plc (the "Company") announces that it has today published its
   Annual Report for the year ended 31 December 2018. The Company's Annual
   Report 2018 can be viewed on the Company's website -
    1 www.travisperkinsplc.co.uk

    

   In accordance with rule 9.6.1 of the Listing Rules, copies of the
   following documents have been submitted to the National Storage Mechanism
   and will shortly be available for inspection at
    2 www.morningstar.co.uk/uk/NSM

    

     • Annual Report and Accounts 2018;

    

   A condensed set of the Company's financial statements and information on
   important events that have occurred during the year and their impact on
   the financial statements were included in the Company's announcement. That
   information together with the information set out below which is extracted
   from the Annual Report constitute the requirements of Disclosure and
   Transparency Rule ("DTR") 6.3.5 which is to be communicated via a
   Regulatory Information Service in unedited full text. This announcement is
   not a substitute for reading the full Annual Report. Page and note
   references in the text below refer to page numbers in the Annual Report.
   To view the preliminary announcement, visit the Company's website:
    3 www.travisperkinsplc.co.uk

    

    

    

    

   Enquiries:

   Graeme Barnes

    4 Graeme.barnes@travisperkins.co.uk

   +44 (0) 7469 401819

    

   Helen O'Keefe

    5 Helen.okeefe@travisperkins.co.uk

   +44 (0) 1604 685910

    

    

    

   STATEMENT OF PRINCIPAL RISKS AND UNCERTAINTIES

   For the year ended 31 December 2018

    

   The Group operates in markets and an industry which by their nature are
   subject to a number of inherent risks. The Group is able to mitigate those
   risks by adopting different strategies and by maintaining a strong system
   of internal control. However, regardless of the approach that is taken,
   the Group must accept a certain level of risk in order to generate
   suitable returns for shareholders and for that reason the risk management
   process is closely aligned to the Group's strategy.

    

   The Board has a risk reporting framework that ensures it has visibility of
   the Group's key risks, the potential impacts on the Group and how and to
   what extent those risks are mitigated. The Board has assessed its risk
   appetite, which is set to balance opportunities for growth and business
   development in areas of potentially higher risk and return, whilst
   maintaining its reputation, legal and regulatory compliance and high
   levels of customer service and satisfaction. As part of its risk
   management process, the principal risks stated in the Group's risk
   register are reviewed, challenged and updated by the Board and monitored
   throughout the year. Each operating business within the Group monitors a
   separate risk register. These risk registers are used to determine
   strategies adopted by the Group's various businesses to mitigate the
   identified risks and are embedded in their operating plans.

    

   Details of the Group's risk management processes are given in the
   Corporate Governance report on page 59.

    

   In common with most large organisations, the Group is subject to general
   commercial risks: for example, political and economic developments,
   changes in the cost of goods for resale, increased competition in its
   markets and the threat of emerging and disruptive competitors, material
   failures in the supply chain, failure to secure supply of goods for resale
   on competitive terms, cyber-security breaches and failure of our IT
   infrastructure.

    

   The risk environment in which the Group operates does not remain static.
   During the year, the Directors have reviewed the Group's principal risks
   and have concluded that as the nature of the business and the environment
   in which it operates remain broadly the same, the principal risks it faces
   are largely unchanged. However, following the announcement in December
   2018 that the Group strategy is being refined to achieve greater
   simplification and focus on serving trade customers through advantaged
   businesses, activities are underway to reshape the portfolio with the
   proposed divestment of the Plumbing & Heating businesses. As a result, the
   Directors have concluded that acquisition and disposal activity,
   previously combined with risks associated with business transformation
   projects, is a key area of focus and heightened risk for the Group and it
   is now described separately. The Directors have also extended the
   description of health and safety risk to consider in more detail the
   transport related risk faced by the Group, due to the scale of the fleet
   it operates and the associated regulatory and compliance requirements.
   Finally, the reduction in the deficit for the Group's two main defined
   benefit schemes, supported by the closure of the schemes to future accrual
   in 2018 and a continued focus on liability management, means that the
   Board no longer believes that this area represents a principal risk.

    

   The nature of risk is that its scope and potential impact will change over
   time. As such the list below should not be regarded as a comprehensive
   statement of all potential risks and uncertainties that may manifest in
   the future. Additional risks and uncertainties that are not presently
   known to the Directors or which are currently deemed immaterial could also
   have an adverse effect on the Group's future operating results, financial
   condition or prospects.

    

   The table on pages 36 to 41 sets out, in no particular order,  the current
   principal risks that the Board considers to be material, their potential
   impacts, the factors that mitigate them and those areas of the businesses'
   strategies they potentially impact. The inherent risk (before the
   operation of control) is stated for each risk area together with an
   indication of the current trend for that risk.

    

   CHANGING CUSTOMER AND COMPETITOR     
   LANDSCAPE
                  RISK DESCRIPTION

                  The Group sells
                  and distributes
                  building
                  materials through
                  a number of
                  channels. The
                  number of outlets
                  and channels
                  where building
                  materials can be
                  purchased
                  continues to grow
                  with new
                  competitors
                  entering the
                  market. These new RISK MITIGATION
   INHERENT RISK: entrants may
   HIGH           operate business  Changes to market practice are tracked on
                  models which      an ongoing basis and reported to the
                  differ            Board.
                  significantly
   TREND: STATIC  from the          The Group continues to build
                  traditional       multi-channel capabilities that
                  merchanting,      complement its existing operations and
                  retail and online provide its customers with the
   STRATEGY:      formats from      opportunity to transact with the Group
                  which the Group   through channels that best suit their
   Best-in-class  operates and may  needs.
   service        take market
                  share.            The Group's strategy allows it to use
   Focus on trade                   sites flexibly. Alternative space
                  At the same time, utilisation models are possible,
   Advantaged     customer          including maintaining smaller stores and
   businesses     purchasing habits implanting additional services into
                  continue to       existing branches.
                  evolve with
                  increasing online The development of new, innovative and
   IMPACT:        transactions.     competitive supply solutions is a key
                  Customers'        strength of the Group. It works closely
   Adverse effect preference for    with customers and suppliers on a
                  purchasing        programme of continuous improvement
   on financial   materials through designed to improve its customer
   results        a range of supply proposition.
                  channels and not
   Loss of market just through the  Pricing strategies across the Group are
   share          Group's           regularly reviewed and where necessary
                  traditional       refined to ensure they remain
                  competitors may   competitive.
                  affect the
                  Group's
                  performance and
                  adversely impact
                  the profitability
                  of branch-based 
                  operations.

                  Increasing price
                  transparency
                  could lead to a
                  perception that
                  the Group is less
                  price competitive
                  leading to
                  downward pressure
                  on price and
                  margins.
   COLLEAGUE RECRUITMENT, RETENTION AND SUCCESSION
   PLANS DO NOT DELIVER THE REQUIRED SKILLS AND                
   EXPERIENCE
                  RISK DESCRIPTION

                  The ability to
                  recruit, develop,
                  retain and
                  motivate suitably
                  qualified staff
                  is an important
                  driver of the
                  Group's overall
                  performance. The
                  Group may also be
                  exposed to skills
                  shortages in
                  certain areas
                  which can result
                  in salary cost
                  pressures. The
   INHERENT RISK: availability of
   MEDIUM         suitably
                  qualified
                  commercial
                  drivers is one    RISK MITIGATION
   TREND: STATIC  such area of
                  focus for the     The Group's employment policies and
                  Group, which is   practices are kept under regular review.
                  critical to the
   STRATEGY:      operation of its  Staff engagement and turnover by job type
                  fleet to meet     is reported regularly to the Executive
   Best-in-class  customer delivery Committee and to the Board. Succession
   service        expectations.     plans are established for the most senior
                                    positions within the Group and these are
   Focus on trade The strength of   reviewed annually.
                  the Group's
   Simplifying    customer          The Group's reward and recognition
   the Group      proposition is    systems are actively managed to ensure
                  underpinned by    high levels of employee engagement.
                  the quality of
                  people working    Salaries and other benefits are
   IMPACT:        throughout the    benchmarked regularly to ensure that the
                  Group,            Group remains competitive and the Group
   Inability to   particularly in   operates incentive structures to ensure
   develop and    customer facing   that high performing colleagues are
   execute        roles. Many of    adequately rewarded and retained.
   development    them have worked
   and succession for Travis        A wide range of training programmes are
   plans          Perkins for some  in place to encourage staff development,
                  considerable      whilst management development programmes
   Adverse effect time, during      are available to those identified for
   on delivery of which they have   more senior positions.
   strategy       gained valuable
                  product and
   Competitive    customer
   disadvantage   knowledge and
                  expertise.

                  The Group faces
                  competition for
                  the best people
                  from other
                  organisations.
                  Ensuring the
                  retention and
                  development of
                  employees and
                  that robust
                  succession plans
                  exist for key
                  positions is
                  important for the
                  Group to deliver
                  on its strategic
                  objectives.
   SUPPLIER DEPENDENCY, RELATIONSHIP AND
   DISINTERMEDIATION LEADING TO ADVERSE IMPACTS ON         
   RANGING AND PRICE
                  RISK DESCRIPTION

                  The Group is the
                  largest customer
                  to a number   of
                  its suppliers. In
                  some cases, those
                  suppliers are
                  large enough to
                  cause significant
                  supply
                  difficulties to
                  the Group if they
                  are unable to
                  meet their supply
                  obligations due
                  to either
                  economic or
                  operational
   INHERENT RISK: factors.          RISK MITIGATION
   MEDIUM
                  Alternative       Making decent returns is one of the
                  sourcing may be   Group's cornerstones which requires it to
                  available, but    treat both customers and suppliers
   TREND: STATIC  the volumes       fairly. The commercial and financial
                  required and the  teams have established strong
                  time it may take  relationships with the Group's key
                  those suppliers   suppliers and work closely with them to
   STRATEGY:      to increase       ensure contracts that are beneficial to
                  production could  both parties and the continuity of
   Best-in-class  result in         quality materials.
   service        significant
                  stock-outs for    To spread the risk where possible
   Focus on trade some considerable contracts exist with more than one
                  time leading to   supplier for key products.
   Simplifying    poor customer
   the Group      service.          The Group has made a significant
                                    investment in its Far East infrastructure
   Financial      The Group has     to support its direct sourcing operation
   strength       increased the     which allows the development of own brand
                  sourcing of       products, thereby reducing the reliance
                  products from     on branded suppliers. The Group has also
                  overseas          adopted a conservative hedging policy to
   IMPACT:        factories. This   reduce its exposure to currency
                  has increased the fluctuations.
   Adverse effect Group's exposure
   on financial   to sourcing,      Comprehensive checks are undertaken on
   result         quality, trading, the factories manufacturing products and
                  warranty and      the quality and the suitability of those
   Adverse effect currency issues,  products before they are shipped to the
   on reputation  which again may   UK.
                  lead to an
                  adverse impact on
                  customer service.

                  Manufacturers of
                  building
                  materials sold by
                  the Group may
                  also look to sell
                  their products
                  directly to end
                  customers in the
                  future
                  diminishing the
                  role of
                  distributors such
                  as merchanting
                  and retail
                  distribution
                  businesses.
   UNSAFE PRACTICES RESULT IN HARM TO
   COLLEAGUES, CUSTOMERS, SUPPLIERS OR THE                   
   PUBLIC
                                    RISK MITIGATION

   INHERENT RISK:                   The Group continues to challenge its
   MEDIUM         RISK DESCRIPTION  thinking and approach to improving its
                                    safety performance through its 'Stay
                  Keeping the       Safe' brand.
                  Group's
   TREND: STATIC  colleagues,       Governance of Stay Safe is
                  customers,        well-established and designed to promote
                  suppliers and the a continual focus on health and safety.
                  public safe is a  Stay Safe performance is reviewed at all
   STRATEGY:      cornerstone of    Board meetings, by the Executive
                  the business. The Committee and by the dedicated Stay Safe
   Best-in-class  Group operates    Committee, which is chaired by a
   service        over 2,000 sites, Non-executive Director.
                  many with complex
   Financial      and busy yards.   The Group's regular Divisional leadership
   strength       It also operates  meetings also focus on performance and
                  one of the        continuous improvement in this area.
                  largest vehicle   These forums also monitor the achievement
                  fleets in the UK, of transport-related compliance
   IMPACT:        distributing      requirements, including driver licencing
                  heavy and bulky   and professional competence.
   Harm to our    materials. Poorly
   colleagues,    implemented       Incidents are monitored, investigated and
   customers and  safety practices  corrective action taken to reduce the
   the wider      on site, on the   likelihood of similar incidents in
   community      road or at        future. Stay Safe assurance reviews are
                  delivery          regularly undertaken at sites by
   Potential      locations could   dedicated safety professionals with any
   legal action,  result in         resulting improvement actions tracked to
   fines and      significant harm  completion.
   penalties      to people which
                  would damage the  De-risking the Group's operations,
   Adverse effect Group's           improving health and safety awareness and
   on financial   reputation and    implementing improved ways of working are
   results        could impact      at the forefront of the Group's
                  trading           activities. Further information on
   Adverse effect performance.      progress made during 2018 can be found in
   on reputation                    the Health and Safety report on pages 47
                                    to 49.

                                     
   THE GROUP ALLOCATES CAPITAL INEFFICIENTLY OR UNDER INVESTS            
   IN ADVANTAGED BUSINESS AND DOES NOT ACHIEVE DESIRED RETURNS
                  RISK DESCRIPTION

                  The Group
                  operates a number
                  of different      RISK MITIGATION
                  businesses in the
                  UK which operate  Return on capital is one of the Group's
                  in different but  key performance indicators as shown on
   INHERENT RISK: complementary     page 19.   The Group's decision to refine
   MEDIUM         channels. As the  its strategy and focus on trade customers
                  Group's markets   in the most advantaged businesses will
                  continue to       impact the allocation of capital with
                  develop, it is    more focused management attention and
   TREND: STATIC  investing to      capital deployment in areas of higher
                  enhance its       return.
                  existing
                  businesses and to Responsibility for identifying and
   STRATEGY:      develop new       implementing opportunities to expand,
                  propositions to   improve or modify the Group's operations
   Focus on trade better serve its  rests with each of the Divisional Boards.
                  customers.        Capital is deployed or re-deployed
   Advantaged                       through a Group-led forum to the
   businesses     Whilst the Group  strategically-aligned opportunities
                  operates a        expected to achieve the best return on
   Financial      disciplined       capital.
   strength       capital
                  allocation        Major projects are kept under review to
                  process, there is monitor progress and ensure the
                  a risk that it    deployment of capital remains
   IMPACT:        may be            appropriate.
                  over-investing in
   Adverse effect channels which    Post-implementation reviews are
   on financial   may decline or    undertaken on all major projects and
   results        that it may not   returns are monitored on an ongoing basis
                  be allocating     to ensure that the expected returns are
                  sufficient        achieved and allow the Group to modify
                  capital to new    its capital allocation when appropriate.
                  propositions
                  resulting in
                  sub-optimal
                  returns on
                  capital.
   BUSINESS TRANSFORMATION AND IMPROVEMENT PROJECTS FAIL TO
   DELIVER THE EXPECTED BENEFITS, COST MORE OR TAKE LONGER TO                
   IMPLEMENT THAN ANTICIPATED
                  RISK DESCRIPTION

                  The Group
                  undertakes a
                  variety of
                  projects
                  throughout its
                  business in order
                  to generate
                  returns for its
   INHERENT RISK: shareholders.
   MEDIUM         These projects
                  include the
                  transformation of
                  the Group's core
   TREND: STATIC  IT systems and
                  infrastructure,
                  ongoing
                  development of    RISK MITIGATION
   STRATEGY:      its supply chain
                  operations and    All potentially significant projects are
   Best-in-class  its branch and    subject to detailed investigation,
   service        store networks,   assessment and approval prior to
                  and the           commencement.
   Advantaged     simplification of
   businesses     the Group to      Dedicated teams, including financial
                  speed up decision resource, are allocated to each project,
   Simplifying    making and reduce with additional expertise brought into
   the Group      costs.            the Group to supplement existing resource
                                    when necessary.
   Financial      By their nature,
   strength       such strategic    All strategic projects are supported by
                  projects are      an appropriate governance structure and
                  often             are closely monitored by the Executive
                  complicated,      Committee with regular reporting to the
   IMPACT:        interlinked and   Board.
                  may require
   Adverse effect considerable      Regular communications are undertaken to
   on financial   resource to       keep affected colleagues informed.
   results        deliver them. As
                  a result, the
   Adverse effect expected
   on shareholder benefits,
   value          timescale for
                  delivery and
                  costs of
                  implementation of
                  each project may
                  deviate from
                  those anticipated
                  at their outset.
                  Colleague
                  engagement may be
                  impacted during a
                  period of
                  significant
                  change and
                  cost-focus.
   UNCERTAINTY CAUSED BY THE UK'S DECISION TO LEAVE THE                
   EUROPEAN UNION
                  RISK DESCRIPTION

                  The result of the
                  UK vote to leave
                  the European
                  Union and the
                  subsequent
                  process to
                  determine   the
                  terms of the
                  withdrawal
                  agreement
                  continues to
                  cause
                  considerable
                  market
                  uncertainty. It
                  remains difficult
                  to predict the
                  economic outlook
                  and impact to the
                  Group in the
                  short-term. The
                  Group continued
                  to experience
                  significant
                  volatility in the
                  value of Sterling
                  against the
                  principal
                  currencies used
                  to pay for        RISK MITIGATION
                  imported goods
                  during 2018.      It remains too early to determine the
                                    full impact of the UK's decision to leave
                  Future trading    the European Union, but the Board is
                  relationships     closely monitoring market conditions and
                  with foreign      will react accordingly.
                  markets have yet
                  to be determined  The Board has undertaken a process to
                  and these may     assess the known and proximate risks
                  result in higher  associated with Brexit. This includes
   INHERENT RISK: tariffs or duties assessment of existing risk mitigations
   HIGH           on imports of     and actions in progress and is updated on
                  construction      a regular basis.
                  products as well
                  as extended lead  The Board has already taken steps to
   TREND:         times on imported reduce some costs, but is carefully
   INCREASING     supplies or       balancing the current needs of the
                  result in the     business against what may or may not
                  need to source    occur in the future.
                  some products
   STRATEGY:      elsewhere. These  The Group continues to invest in the
                  risks have the    business where those investments are
   Best-in-class  potential to      expected to realise acceptable returns,
   service        impact the Group  but it is prepared to reduce activity
                  significantly. Of levels should market conditions so
   Financial      less risk to the  dictate.
   strength       Group, but
                  potentially       Exercises have been undertaken by the
                  significant for   divisional leadership teams to assess the
                  its customers,    level of stock holding required in each
                  are the           business unit to minimise disruption to
                  significant       customers. A customer statement is in
   IMPACT:        numbers of non-UK place and will be reassessed as the terms
                  nationals         of the UK's withdrawal are clarified.
   Adverse effect employed in the   Engagement with the Group's key suppliers
   on financial   construction      is ongoing.
   results        industry and the
                  distribution and  Where the cost of goods increases due to
                  logistics         the exchange rate deteriorating or
                  markets. If the   additional tariffs and duties, the Group
                  UK becomes a less will seek to pass those price increases
                  attractive place  through to its customers, but its ability
                  for them to work  to do so will depend upon market
                  this could result conditions at  the time.
                  in labour
                  shortages and     The processes in place around the
                  consequent salary recruitment and retention of people are
                  cost pressures    set out in the principal risk pertaining
                  and could change  to such matters on page 36.
                  dynamics in our
                  key markets.
                  Whilst
                  significant
                  changes to
                  product standards
                  and legislative
                  requirements more
                  generally are not
                  anticipated in
                  the short-term,
                  they could impact
                  the Group if
                  introduced in the
                  future.

                  The continued
                  uncertainties
                  that surround
                  Brexit mean that
                  a more precise
                  assessment of the
                  impact on the
                  Group's
                  operations is
                  unlikely to be
                  possible until
                  the terms of the
                  withdrawal
                  agreement are
                  confirmed.
   MARKET CONDITIONS
   LEADING TO DEMAND                          
   UNCERTAINTY
                  RISK DESCRIPTION

                  The Group's
                  products are sold
                  to businesses,
                  trade
                  professionals and
                  retail customers
                  for a broad range
                  of end uses in
                  the built
                  environment. The
                  Group's markets
                  are cyclical in
                  nature and the
                  performance of
                  those markets is
                  affected by
                  general economic
                  conditions and
   INHERENT RISK: specific drivers
   HIGH           of construction,  RISK MITIGATION
                  Renovation,
                  Maintenance and   The Board conducts an annual review of
                  Improvement and   strategy, which includes an assessment of
   TREND:         DIY activity.     likely competitor activity, market
   INCREASING     These include     forecasts and possible future trends in
                  mortgage          products, channels of distribution and
                  availability and  customer behaviour.
                  affordability,
                  housing           The Group maintains a comprehensive
                  transactions and  tracking system for lead indicators that
   STRATEGY:      the timing and    influence the market for the consumption
                  nature of         of building materials in the UK.
   Best-in-class  government
   service        activity to       Significant events including those in the
                  stimulate         supply chain that may affect the Group
   Focus on trade activity, net     are monitored by the Executive Committee
                  disposable        and reported to the Board monthly by the
   Advantaged     income, house     Group CEO.
   businesses     price inflation,
                  consumer          Should market conditions deteriorate then
                  confidence,       the Board has a range of options
                  interest rates    dependent upon   the severity of the
   IMPACT:        and unemployment. change. Historically these have included
                                    amending the Group's trading stance, cost
   Adverse effect A significant     reduction, lowering capital investment
   on financial   downturn in       and cutting the dividend.
   results        economic
                  conditions or
                  alternatively
                  major uncertainty
                  about the future
                  outlook could
                  affect the levels
                  of construction
                  activity in the
                  Group's markets
                  and the
                  confidence levels
                  of the Group's
                  customers, which
                  could reduce
                  their propensity
                  to purchase
                  products and
                  services from the
                  Group's
                  businesses.
   EXECUTION OF PLANNED DISPOSALS AND POTENTIAL ACQUISITIONS FAILS
   TO DELIVER THE EXPECTED BENEFITS TO THE EXPECTED COST AND               
   TIMESCALE
                  RISK DESCRIPTION

                  The Group
                  undertakes
                  acquisition and
                  disposal activity
                  to optimise its
                  portfolio of
                  businesses and
                  drive shareholder
                  return. In
                  December 2018,
                  the Group
                  announced its
                  intention to
                  explore the
   INHERENT RISK: potential
   MEDIUM         divestment of the
                  Plumbing &
                  Heating division,
                  as part of the
   TREND:         broader strategy
   INCREASING     of simplifying    RISK MITIGATION
                  the Group. This
                  division          All merger, acquisition and disposal
                  comprises a       activities are subject to a detailed
   STRATEGY:      number of         appraisal process and ultimate approval
                  businesses of     by the Board.
   Focus on trade varying size
                  which operate on  A formal programme of work with dedicated
   Advantaged     a range of        resource has been put in place to support
   businesses     systems, some of  the execution of the Plumbing & Heating
                  which are shared  disposal. External expertise and advisors
   Simplifying    with the wider    are involved as required to support the
   the Group      Group.            programme team.

   Financial      The programme to  All activity of this kind is supported by
   strength       separate the      robust governance and monitoring. The
                  Plumbing &        Plumbing & Heating programme is closely
                  Heating           monitored by a programme Steering
                  businesses for a  Committee, with Executive sponsorship and
   IMPACT:        potential sale is representation. There is regular
                  complex with many reporting to the Executive Committee and
   Adverse effect linkages to Group Board.
   on financial   systems and
   results        processes. The
                  Group has not
   Adverse effect undertaken a
   on shareholder restructure and
   value          disposal on this
                  scale for some
                  time and it
                  requires careful
                  management. The
                  costs and
                  timescale for the
                  separation may
                  deviate from
                  those originally
                  planned, which
                  could in turn
                  impact the
                  progression of a
                  sale process and
                  the value
                  realised.
   DATA SECURITY                     
   INHERENT RISK: RISK DESCRIPTION  RISK MITIGATION
   MEDIUM
                  Incidents of      The strategic demands of the business,
                  sophisticated     the resources available to IT, the
                  cyber-crime       performance levels of key systems and IT
   TREND:         represent a       security are kept under review by the
   INCREASING     significant and   Executive Committee, with responsibility
                  increasing threat for monitoring and maintaining cyber
                  to all businesses security delegated to a data security
                  including the     committee.
   STRATEGY:      Group. A major
                  breach of cyber   Investments in best-of-breed solutions
   Best-in-class  security could    are made that continually adapt and are
   service        result in         updated to mitigate the risk associated
                  disruption to     with the most advanced threats and the
   Financial      customer- facing, evolution of Group technology adoption.
   Strength       supplier-facing
                  and financial     Cyber security controls are in place to
                  systems through   protect IT systems and data including
                  theft and misuse  firewalls, virus protection and
   IMPACT:        of confidential   penetration testing. A programme of
                  data, damage to   risk-oriented reviews is undertaken to
   Adverse effect or manipulation   ensure the level of control around IT
                  of operationally  systems remains robust.
   on financial   critical data or
   results        interruption to   An IT disaster recovery plan exists
                  IT services, any  together with a business continuity plan.
   Adverse effect of which may have Arrangements are in place for alternative
   on             serious impacts   data sites for both trade and consumer
                  on the Group's    businesses. Off-site back-up routines are
   the Group's    reputation or     in place.
   reputation     ability to trade.
   THE CHANGING REGULATORY FRAMEWORK
   INCREASES THE RISK OF NON-COMPLIANCE                
   AND FINES
   INHERENT RISK:
   MEDIUM
                                    RISK MITIGATION
    
                                    The Group's in-house legal team is
   TREND: STATIC                    responsible for monitoring changes to
                                    laws and regulations that affect the
                  RISK DESCRIPTION  business and is supported by external
                                    advisors.
   STRATEGY:      The Group is
                  subject to a      The Group has a comprehensive framework
   Best-in-class  broad range of    of policies in place that sets out the
   service        existing and      ways employees and suppliers are expected
                  evolving          to conduct themselves. Those expectations
   Focus on trade governance        are widely disseminated using a range of
                  requirements,     methods to ensure colleagues and
   Advantaged     environmental,    suppliers understand their
   businesses     health and safety responsibilities to comply with the law
                  and other laws,   and other regulations affecting the Group
   Simplifying    regulations,      at all times.
   the Group      standards and
                  best practices    The Group provides online training to
   Financial      which affect the  colleagues in key areas of legal and
   strength       way the Group     regulatory compliance, including a suite
                  operates and give of mandatory training for those that join
                  rise to           the Group. During 2018 Group-wide
                  significant       training was undertaken in respect of
   IMPACT:        compliance costs, GDPR.
                  potential legal
   Adverse effect liability for     The Executive Committee and the Board
   on the         non-compliance    regularly monitor compliance with laws
   Company's      and potential     and regulations.
   reputation     limitations on
                  the development   The Group operates a whistleblowing
   Adverse effect of the Group's    process   that allows the anonymous
   on financial   operations.       reporting through an independent hotline
   and                              of any suspected wrongdoing or unethical
   operational                      behaviour, including reporting instances
   performance                      of non-compliance with laws and
                                    regulations. All reported cases are
   Potential                        investigated.
   legal action,
   fines and
   penalties
                                                                             

    

    

   ══════════════════════════════════════════════════════════════════════════

   ISIN:           GB0007739609
   Category Code:  ACS
   TIDM:           TPK
   LEI Code:       2138001I27OUBAF22K83
   OAM Categories: 1.1. Annual financial and audit reports
   Sequence No.:   7634
   EQS News ID:    781361


    
   End of Announcement EQS News Service

   ══════════════════════════════════════════════════════════════════════════

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