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Business Review – Lucy Electric

STRATEGIC REPORT

We continue to enhance supply-chain resilience through diversification of suppliers, contingency planning and operational efficiency. Sustainability Sustainability is integral to our strategy, from product design to operations. We aim to achieve net zero by 2050 and have made tangible progress in reducing carbon intensity, down 22.3% since 2021. Solar installations in the UK, India, UAE and Saudi Arabia are reducing our operational emissions, while partnerships with BEAMA and investments in SF6 gas purification support industry-wide decarbonisation. We are developing standardised measures for product embodied carbon and supporting customers with end-of-life services. In Thailand, our comprehensive sustainability programme was awarded the Environmental Sustainability Award at the Eastern Economic Corridor International Business Awards (EECIBA). We completed 141 community projects in 2025. One typical example is Lucy Electric UK’s support for a series of engaging environmental education workshops led by 21st Century Thame, aimed at inspiring local primary school children to give recycled materials a second life.

People Our achievements are a testament to the dedication and ingenuity of our teams worldwide. Engagement scores have improved to 80%, with high participation in training, wellbeing and leadership programmes reflecting a positive and committed culture across the business. Aiming to attract, grow and retain the right talent, our approach spans apprenticeships, graduate schemes and our Future Leaders programme, with targeted initiatives to address skills shortages and maintain an inclusive work environment. Health, safety and wellbeing remain paramount, with ISO 45001 certification and a proactive approach to risk management. Outlook Our long-term vision remains unchanged: to be a trusted partner for our customers worldwide, delivering intelligent, sustainable solutions for the evolving energy landscape. As we look ahead, we do so with confidence. Although the market environment remains uncertain and demanding, we are committed long-standing players. Lucy Electric’s ambitions for growth are supported by a strong financial base, a clear strategy and a talented, committed team. We will continue to invest in technology, regional diversification and operational excellence to support our customers and create sustainable value. The focus for 2026 will be on continued growth in our new business areas, particularly in digitalisation, while maintaining margin discipline and further embedding sustainability.

on the evolution of our product ranges, engineering and adapting variants based on customer demand and diverse local-market needs. Product development for the Aegis EcoTec range (all non-SF6) has focused on higher voltages (24kV and early stage development of 36kV) and on the AcuTec LV switchboard. Critically, we have retained a compact physical footprint on our SF6-free products, as well as adding features very much in line with customer requirements. Our digital solutions deliver improved network visibility and reduced downtime. We continue to develop Synaps, our fault detection solution, underground cables. With GridKey, we have been working on the new generation of controllers, launching in early 2026 to meet the rising demand for low-voltage monitoring systems. Manufacturing and supply chain Amid rising competitive pressure on selling prices, we continue to prioritise healthy margins through disciplined cost management and operational efficiency, while simultaneously maintaining our commitment to meeting evolving customer requirements and ensuring high product quality and customer satisfaction. Significant investments in manufacturing capacity and technology include factory expansion in India and the EV Infrastructure facility in the UK, all key milestones in our global manufacturing strategy. We are investing in better shop floor data collection and how we can optimise machine utilisation. We are also increasing automation in our factories to enhance productivity, to further improve consistency and quality, to reduce operational risk, and to support scalable, cost efficient growth. enabling customers to deploy it for predictive maintenance on

“ Against persistent market headwinds, profits decreased year-on year but remained robust, highlighting the strength and adaptability of our people.”

John Griffiths

CEO Lucy Electric

After the exceptional profits reported last year, 2025 has been a year of resilience at Lucy Electric. A deterioration in market conditions in the second half of the year resulted in a weakening of the order book, yet we delivered solid results and continued to advance our vision for a smarter, more sustainable energy future.

Market review The global energy sector is characterised by electrification

Growth areas Our multinational footprint means we can engineer solutions locally, ensuring consistency, reliability and responsiveness while reinforcing trusted, long-standing customer relationships. To improve the service we offer to customers, we have launched three distinct business units this year: Digital Solutions, Energy Services, and EV Infrastructure (see pages 32 and 33 for details). We see these business areas as key pillars of growth and have recruited talented and experienced people to lead and develop them. Product development Last year, we launched and installed the Sabre EcoTec RMU, using synthetic air instead of SF6 – a first in the UK, marking a significant step towards sustainable grid solutions. For this, we were shortlisted in the Innovation of the Year category at the 2025 edie Net-Zero Awards. Our continued investment in R&D is principally based

On the other hand, we have seen strong and continued improvements in India due to ongoing grid modernisation in recent years, where customers very much want products made in India, for India, and our approach is bearing fruit. Across much of the Middle East, there is a strong and accelerating commitment to diversify away from fossil fuels and invest in the infrastructure required to support increased electricity usage. Much the same can be said for Africa, recognising that consistent availability of power is necessary to attract investment from industry. Our relatively new Australian entity has performed well. The country is targeting 82% renewable electricity by 2030 through initiatives like the Renewable Energy Target (RET) and the Future Made in Australia policy. This has fuelled business growth as we address the growing demand for switchgear to connect battery energy storage systems, solar power plants and wind farms.

and the drive for net zero. With the growing demand for secondary power distribution comes the need for grid resilience, expanded capacity, and advanced monitoring and control. Developed markets tend to focus on modernisation and digitalisation, yet slow investment in transmission is inhibiting growth in distribution. However, emerging economies are moving more quickly in prioritising network expansion and reliability. respects, a lack of clarity on policy decisions – as well as a shortage of skilled engineering capability – is delaying transmission capacity and Distribution Network Operator (DNO) investment, leading to lower demand. Southeast Asia remains challenging due to its continued slow economic recovery, headwinds from delayed investment decisions, and increased competition, particularly from Chinese manufacturers. While the UK is a renewables technology leader in many

John Griffiths CEO Lucy Electric 24 March 2026

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Lucy Group Ltd Annual Report & Accounts 2025

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