LucyGroup-ARA2024_spreads web ready_FINAL

OPERATIONAL REVIEW

BUSINESS OVERVIEW STRATEGIC REPORT CORPORATE GOVERNANCE FINANCIAL STATEMENTS SHAREHOLDER INFORMATION

embedded carbon, and we conducted an employee survey, the results of which will guide strategic initiatives for improvement. Solar power is key to our sustainability strategy, and we have fitted solar panels at our operations in Thame and Ponteland in the UK, and in Nasik and Vadodara in India. The new factory extension at Lucy Zodion in Sowerby Bridge includes the installation of 108 solar PV array panels, generating 44,000 kWh annually. Combined with existing arrays, this brings the total to 442 panels on site, with an annual generation of 131,000 kWh. These initiatives will allow the factory to operate off-grid for much of the year, significantly reducing its reliance on external power sources. People The shortage of skilled workers, especially in engineering and technical design, continues to be a challenge. We are therefore investing heavily in training our employees. In particular, we have always placed great emphasis on apprentices and have now started a graduate programme in the UK and in India, aiming to make manufacturing and engineering roles more appealing to a diverse workforce. Summary and outlook The commitment to data capture and world-class information systems is a key strategy the Group has been following for several years, and this continued in 2024. We are increasingly seeing the benefit of earlier years’ work, which provides effective tools for our people to run and manage business activities today. This approach also applies to production technology and automation. Our programme of continued investment is ensuring that our businesses can operate more quickly, smartly and sustainably, remaining competitive in rapidly changing markets. But there is still much to do. Although we have seen several important achievements in 2024, we are determined to continue making significant year-on-year progress.

In Lucy Controls, Lucy Zodion’s factory expansion in Sowerby Bridge, UK, is now almost complete and will be operational from February 2025. This 11,000 sq ft extension will help meet the growing demands of the EV and streetlighting markets. At Flashnet, we expanded the factory and warehouse in Brasov, Romania, and introduced automation upgrades, resulting in a doubling of production capacity. Re-engineering business Microsoft D365 is central to our operations strategy, and underpins our ongoing focus on digital transformation, customer service and data-driven decision making. Quarterly upgrades continue to provide added functionality. These include the Copilot artificial intelligence tool, which we have introduced across our businesses, and which is proving particularly valuable in expanding the capability of our marketing and sales activities. We broadened our use of the Vendor Collaboration module to streamline procurement processes, including e-bidding. This tool has also improved digital workflows to support vendor interactions and governance. processes using Microsoft D365

Through investment in our production facilities and business processes, we are building a firm foundation for improved operational performance. This year, in particular, we made substantial capital investments in expanding factory capacity, advancing technology, increasing automation and improving processes, data security and sustainability. “ In 2024, we made substantial investments in multiple regions, with each project supporting our long-term growth agenda. ”

Data security Cyber attacks on businesses have been increasing, in both frequency and sophistication. By implementing effective cyber-security practices and procedures, we can harness the full potential of data while maintaining responsible data-management standards and reducing the risk of data breaches, data loss and unauthorised data usage. To achieve this, we have established two governance bodies. The Executive-led Information Security Steering Committee (ISSC) provides overarching strategy, governance and leadership, while the Information Security Operations Group (ISOG) focuses on the day-to-day operational management of our security, including our global IT security programme. Supporting this work, we have achieved ISO27001 certification, the leading international standard for information security management. We have also achieved Cyber Essentials Plus accreditation, a government backed scheme – with independent verification – which helps organisations protect themselves against the most

We began our Microsoft D365 Accounts Payable automation project in 2024, with roll-out planned to start in 2025. The benefits will be in saving time, improving efficiency, reducing errors and enhancing financial management. In manufacturing operations, we piloted Production Floor Execution to digitise all operational data, providing real-time visibility and control over the shop floor. Roll-out of this is a multi-year project beginning in 2025. In Lucy Electric, we have introduced the Asset Management module across several factories, giving us a single application for reporting faults and planning maintenance. We will also be rolling out simulation software within the engineering team during 2025. In Flashnet, we have begun the roll-out of Microsoft D365. Bringing all three Lucy Controls businesses onto the same software platform will benefit Lucy Controls’ management as well as the individual businesses. A project to replace Lucy Real Estate’s business systems began in 2024, with the aim of introducing systems that cover all data and processes and provide insights to inform better decision making. In Lucy Developments, the launch of Microsoft D365 Finance and Supply Chain Management is scheduled for the second quarter of 2025. Once we have completed this successfully, we will implement the module at Lucy Properties.

Lucy Electric opened a new medium voltage switchgear factory in Dhahran, Saudi Arabia (picture below and above), replacing two existing facilities to bring production under one roof. Equipped with smart warehouse technology, an overall equipment effectiveness (OEE) dashboard and digital twins to monitor machinery efficiency, the new facility will boost local manufacturing capabilities, create job opportunities for Saudi nationals, and improve the skills of our local workforce. In addition, we completed Lucy Electric factory expansions in Dubai, UAE, and Vadodara, India, with the latter including a new ISO 8-compliant cleanroom for RTU modules.

Strategy The Group has global manufacturing facilities and a number of manufacturing units, strategically located in key regions, from where we serve local markets. Our intention is to keep investing in these manufacturing centres, advancing production technology and increasing output. Given the trend towards localisation, this approach serves us well, while also enabling us to be flexible in balancing the utilisation of capacity across our operations globally.

common cyber threats. Sustainability

In 2024, we made significant progress in reducing the environmental impact of our operations and fostering a culture of sustainability. We extended sustainability data capture to include

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Lucy Group Ltd Annual Report & Accounts 2024

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