Key Performance Indicators

To support the Group’s strategy and to monitor performance, the Board of Directors and the Executive Committee use a number of financial and non-financial key performance indicators (KPIs). These KPIs are selected measures which are important to the Group. Progress is assessed by comparison with the Group’s strategy, its budget for the year and historical performance.

Divisional and business management use a range of further benchmarks and other KPIs as part of their planning and performance review processes. In order to measure the organic performance of the business, management further analyse the headline KPIs to exclude the impact of acquisitions and foreign exchange.

The KPIs are selected and reviewed to ensure they remain important to the success of the Group. Financial and non-financial performance is reviewed in more detail in the Corporate responsibility, Review of operations and Group financial review sections of the Annual Report.

 

KPI 2017 2016 Why a KPI? Performance Commentary
Financial KPIs        
Organic constant-currency revenue growth 1  1.4% (1.5)%
  • Creating consistent long-term value for shareholders.
  • Focus on higher growth markets.

On an organic constant-currency basis revenue improved 1.4%.
See Review of operations on pages
30 to 39.
Group headline operating profit
margin 1		 11.7% 11.8%
  • Creating consistent long-term value for shareholders.
  • To have a culture
    of operational excellence and
    cost-efficiency.
 Improving momentum with a return to organic growth, underpinned by operational efficiencies, and reinvestment into the businesses, partially offsetting the impact of the disposals.
Free cash flow before
acquisitions, dividends, and US pension payment 1		 £54.0m £48.0m
  • Creating consistent long-term value for shareholders.
 The increase compared to 2016 was as a result of improved cash from operations (excluding the one-off US pension payment), lower capital expenditure and restructuring costs.
Return on invested capital 1 17% 16.7%
  • Creating consistent long-term value for shareholders.
 Improvements in return on invested capital are primarily driven by increased operating profit.
Headline earnings per share1 22.5p 22.7p
  • Creating consistent long-term value for shareholders.
 Marginally lower headline earnings per share resulting from the tax impact on specific adjusting items.
Dividend per share 11.0p 11.0p
  • Creating consistent long-term value for shareholders.
 The Board has held the dividend flat during 2017 as it looks to rebuild dividend cover in the
medium term.
Non-financial KPIs        
Employee turnover 12.6% 11.7%
  • To attract, retain, and develop the right people in the right roles.
 This is believed to be an appropriate level of employee turnover.
Lost Time Accident Frequency3
(per 100,000 hours worked)		 0.39 0.27
  • To maintain a workplace that focuses on the health and safety of its employees and others affected by the Group’s operations.
 Despite the focus placed on health and safety at all sites and across all levels of the Group through ‘thinkSAFE’ leading to a lower total accident frequency, there was a higher lost-time impact.
Tonnes CO2e per £m revenue 2,3 326 346
  • To minimise the impact of the Group’s business on the environment.
 Although the Group benefited from a series of projects and environmental programmes focused on the sites identified as having the greatest environmental impact, overall CO2e increased.
1. Definitions of these non-GAAP measures, and their reconciliation to the relevant GAAP measure, are provided on pages 41 to 44 of the Annual Report 2017.
2. This KPI uses revenue at constant-currency in its calculation.
3. The 2017 lost-time accident frequency and CO2e information have been subject to assurance by ERM Certification and Verification Services, see page 50 for further details.