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Chairman’s Statement

BUSINESS OVERVIEW

Products The Group is firmly committed to R&D, with ongoing development across our product range covering both Lucy Electric and Lucy Controls. Lucy Electric successfully installed the Sabre EcoTec RMU and is now applying SF6-free technology across the voltage range, enabling us to look to new markets. AcuTec, a new generation of distribution cabinet, is engineered to meet the growing demands of modern low-voltage networks and is gaining traction with UK Distribution Network Operators (DNOs). We are developing a full range of type tested high-powered pillars for EV charging networks. Further investment was made in the Digital Solutions business to meet the growing demand for switchgear with embedded sensors, remote monitoring and predictive diagnostics, and ultimately to generate ongoing revenue from subscription-based software. In Lucy Controls, Lucy Zodion’s Hawk3 streetlighting photocell, mentioned earlier, is designed with sustainability principles from the outset and helps councils and contractors cut costs, reduce carbon and support safer, smarter streets. People One of the acknowledged shortcomings of the entire electrical energy sector is a lack of available people with the requisite skills. Therefore, we continue to invest heavily in training and development, with an emphasis on early careers, including increased activity across apprenticeships, graduate schemes, internships and work placements. We launched a career pathway feature, helping employees better plan and track their development, and have introduced manager dashboards to provide leaders with real-time insights into teams’

loss for the year, sales increased over 2024, and we made good progress on construction at our two largest sites to date, Bodicote and Old Marston Paddock, the latter being sold completely to Oxford City Council for affordable housing. Dividend The Board recommends a final dividend of 186p to be paid on 5 May 2026 which, including the interim dividend of 128p per share, represents a full-year dividend of 314p (2024: 301p). In addition, we paid a special dividend of 400p per share (2024: 600p per share) on 4 December 2025. Strategic developments During the year, Lucy Electric restructured its UK business, establishing two new entities to bring renewed focus in electric vehicle infrastructure and energy services. Lucy Electric extended the Nashik plant in India to support future growth. We also completed a strategic investment that enhanced our manufacturing capabilities in Dubai. We remain committed to investing in manufacturing automation and in engineering’s AI capabilities, using a predictive simulation platform to reduce reliance on costly external testing. Alongside this, we are expanding our use of Microsoft D365 applications and adopting AI enhancements. We continue to assess viable acquisitions that will complement and add value to our portfolio. In the final quarter of 2025, we acquired 100% of the shares in Blakley Electrics Ltd, a UK family-owned firm with an annual turnover of approximately £20m, providing industrial lighting and low voltage equipment for construction sites and temporary power supplies. This company will be included within the Lucy Controls business unit.

“ Although it has been a challenging year, our focus on innovation and new product development means that we are well positioned to take advantage of an uplift in the markets we serve.”

Richard Dick

Executive Chairman

Lucy Group Wins Leadership Team of the Year

Welcome to Lucy Group’s Annual Report and Accounts for the year ending December 2025. This year’s turnover was a creditable £422m (2024: £409m), but profit before tax - as forecast last year - reduced to £56m (2024: £85m), reflecting more challenging market conditions in 2025. We end the year in a strong financial position, with net assets of £431m (2024: £394m) and continued positive free cash flow. We have maintained our policy of investing for the long term, in our people, our manufacturing and our processes.

We were presented with the Leadership Team of the Year award at this year’s Thames Valley 250 Awards, an annual celebration of the top private businesses with headquarters in the region. Our winning award category is for leadership teams who champion their contribution to the community, prioritise the development of their people, and strive for excellence in products or services.

expand the tenant property portfolio. We continue to invest in bringing our properties up to energy performance level C. Lucy Developments operates in a UK property market that remains under severe pressure, with an imbalance between the cost of building new properties and what people can afford to pay. That said, although the business sustained a

At Lucy Controls, Flashnet made further gains in the North American market, while business in wider markets, particularly Europe, was less buoyant than hoped. Offering first-class smart city solutions, the business has increased its capacity to grow, including establishing an entity in the US to improve market access and enhancing its manufacturing operation in Romania. Lucy Zodion continued to face subdued demand, as UK local authorities struggled with budget constraints, though I am confident its award-winning Hawk3 streetlighting photocell will prove to be successful. Lawson Fuses delivered lower sales than planned, but progress on restructuring is reducing the cost base and expected to strengthen profitability. In Lucy Real Estate, Lucy Properties had another excellent year, with high occupancy levels and rental growth of 9%, while work commenced at Girdlestone Close in Headington to add two additional floors, which will

Performance In 2025 we faced adverse trading conditions, including increased competition - especially from China - that eroded selling prices, as well as increased tariffs on imports in key markets. The extra National Insurance liability in the UK has been a factor in increasing overhead costs. Against this backdrop, Lucy Electric achieved a respectable performance, with sales marginally ahead of last year. In 2024 our exceptional levels of profit were driven by a favourable product mix and several high margin contracts, which came to an end in early 2025. Electrification, and particularly the connection of renewables, is still a rising trend but the pace of change varies greatly across the world. The UK has fallen behind expectations, with government policy not being realised in infrastructure spending, leading to disappointing levels of investment.

For more information on our Leadership Team , see page 82 .

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Lucy Group Ltd Annual Report & Accounts 2025

LUCYGROUP.COM

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