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Annual report and accounts for the year ended 31 March 2019 Stock code: SFR www.severfield.com Severfield plc Annual report and accounts for the year ended 31 March 2019 and accounts for the year ended 31 March Annual report from a strong foundation a strong from Delivering sustainable growth Delivering sustainable growth Severfield AR2019 Strategic and Governance.indd 3 25/07/2019 10:13:08 26620 18 July 2019 3:24 pm Proof 12 26620 18 July 2019 3:24 pm Proof 12 ANNUAL Annual report and accounts REPORT for the year ended 31 March 2019 Stock code: SFR www.severfield.com Review this annual report online at: severfield.annualreport2019.com Severfield AR2019 Strategic and Governance.indd 4 25/07/2019 10:13:11 26620 18 July 2019 3:24 pm Proof 12 WELCOME TO OUR 2019 ANNUAL REPORT Severfield is the largest specialist structural steelwork group in the UK, with a growing presence in India and Europe and a reputation for performance and value. I am pleased to report that Our ‘Smarter, Safer, more 2019 has been another Sustainable’ initiatives have successful year, with further contributed to increased progress made towards our operational efficiencies, which strategic objectives in the are benefitting the Group’s UK, Europe and India. profitability. John Dodds Alan Dunsmore Non-executive chairman Chief executive officer Read more on our chairman’s view Read more about our strategy on page 8 on pages 26 to 32 Investor website We maintain a corporate website at www.severfield.com containing a wide range of information of interest to institutional and private investors including: • Latest news and press releases • Annual reports and investor presentations Severfield AR2019 Strategic and Governance.indd 5 25/07/2019 10:13:13 26620 18 July 2019 3:24 pm Proof 3 Severfield AR2019 Strategic and Governance.indd 6 25/07/2019 10:13:15 26620 18 July 2019 3:24 pm Proof 12 01 Contents Overview Severfield: a snapshot 02 Our year in review 04 Building our strong foundations 06 Our chairman’s view 08 Our unique offering 10 The scale of our operations 12 Strategic report How we create value 18 The markets we serve 20 Our market sectors 22 JSW Severfield Structures 24 Our strategy 26 Key performance indicators 34 Our operating performance 38 Our financial performance 46 Building a sustainable business 52 How we manage risk 62 Our governance Our board of directors 78 Our executive committee 80 Our chairman’s view on governance 84 Corporate governance report 86 Audit committee report 92 Nominations committee report 96 Directors’ report 98 Directors’ remuneration report – Letter from the committee chairman 102 – Policy 104 – Implementation 111 Directors’ responsibilities statement 121 Our financials — Group Independent auditor’s report 124 Consolidated income statement 132 Consolidated statement of comprehensive income 133 Consolidated balance sheet 134 Consolidated statement of changes in equity 135 Consolidated cash flow statement 136 Notes to the consolidated financial statements 137 Five year summary 169 Financial calendar 169 Our financials — Company Company balance sheet 170 Company statement of changes in equity 171 Notes to the Company financial statements 172 Shareholder information Addresses and advisers 177 Shareholder notes 178 Severfield AR2019 Strategic and Governance.indd 1 25/07/2019 10:13:18 26620 18 July 2019 3:24 pm Proof 12 Our projects The strength within structures iconic 26620 16 July 2019 9:35 am Proof 11 Severfield AR2019 Brag Book.indd 1 25/07/2019 10:13:20 TOTTENHAM HOTSPUR This project involved the construction of a new football stadium at White Hart Lane in London – the home ground of Tottenham Hotspur. Location Tottenham, London Client Tottenham Hotspur Football Club Contract manager Mace Engineer BuroHappold Engineering Architect Populous Tonnage 16,700 Completion date July 2019 The project The new stadium provides Construction of the first phase of the Tottenham Hotspur with a project, comprising the north, east state-of-the-art sporting and and west stands, took place during entertainment facility, which seats the 2016/17 football season whilst over 62,000 spectators. It is the the old White Hart Lane stadium was first stadium in the UK to feature a still in operation. Following the last retractable pitch which divides into game of the season, in May 2017, a retractable grass pitch for football the old stadium was demolished and and a synthetic surface underneath work on the south stand commenced for National Football League (‘NFL’) during our 2018 financial year. The games and other sporting and main features of this first phase were entertainment events. two architecturally unique steel ‘trees’ within the south stand, each weighing Severfield plc Severfield AR2019 Brag Book.indd 2 25/07/2019 10:13:21 26620 16 July 2019 9:35 am Proof 11 275 tonnes, which support the new ring which creates the 693-metre lifting of the 600-tonne roof into 17,500-seater single-tier home elliptical outside profile of the place was performed before stand designed to provide excellent stadium. The compression ring the stadium’s seating bowl was sightlines and generate a ‘wall of comprises 54 box girders each completed, building an additional sound’ within the seating bowl. measuring around 15 metres layer of complexity into an already long and weighing between 25 challenging project. Lifting the cable During the Group’s 2019 financial to 30 tonnes. The structure was net roof structure involved a highly year, the second phase of the trial assembled and fabricated complex hydraulic strand jacking project mainly focused on the at our Lostock facility in order to operation, requiring the most jacks construction of the highly technical achieve accuracy in length within used in such a lift in the UK. roof structure. The new roof is tolerances of less than 1 millimetre. formed from structural tension On site, due to the fast-paced cables fixed to the compression nature of the programme, the 26620 16 July 2019 9:35 am Proof 11 Severfield AR2019 Brag Book.indd 3 25/07/2019 10:13:23 60 LONDON WALL The 60 London Wall redevelopment project will transform a 1980s office block located in the City of London into a modern 12-storey mixed-use retail and commercial destination. Occupying a prominent 1.3-acre corner site in a prime location, it’s a great example of how new structural elements can be incorporated into old. Location City of London Client LaSalle Investment Management Main Contractor Skanska Engineer Heyne Tillett Steel Architect EPR Architects Tonnage 2,000 Completion date August 2019 The project The property comprises a basement extra five floors, increasing the total level, containing service and support office space to 320,000 square feet. facilities, a ground floor with office Replacing the original concrete reception, office and retail floor core with two new slimmer cores space with the majority of the office to create an atrium, Severfield space arranged over large flexible extended the existing building upper floorplates arranged around by a further five storeys with the a central atrium. The project aims installation of a new structural to extensively refurbish, reconfigure steel frame. We also fabricated and reinvent the existing seven- and installed steelwork for the storey 1980s building by stripping full-height scenic lifts around the it back to the frame and adding an edge of the atrium, which consisted Severfield plc Severfield AR2019 Brag Book.indd 4 25/07/2019 10:13:23 26620 16 July 2019 9:35 am Proof 11 of ladder-frame type assemblies As well as the logistical challenges required to ensure the engineers, connected back to the mainframe associated with working on a busy architects and the Severfield steelwork. Planning, timing and city centre site in London, this drawing office had as much logistics were key in making sure project also presented additional real-time information as possible so the various elements of the project design and installation complexities that connections could be designed were installed smoothly as, due to that are generally not found on to adapt to the pre-existing steel the site’s location in the heart of typical new-build projects. Once the frame. Tying into the existing frame the City, early morning deliveries existing building had been stripped meant a substantial amount of and temporary road closures back to the original concrete core, new connections were required to were required in order to minimise close collaborative working with be made on site (either drilled or disruption. numerous trades and extensive site welded) to support the new steel surveying of the existing frame were framework. 26620 16 July 2019 9:35 am Proof 11 Severfield AR2019 Brag Book.indd 5 25/07/2019 10:13:24 22 BISHOPSGATE Located in the heart of the City of London, 22 Bishopsgate is a new 62-storey office tower situated within the City’s financial district. Location City of London Client AXA Real Estate Main Contractor Multiplex Europe Engineer WSP UK Architect PLP Architecture Tonnage 17,000 Completion date Mid-2019 The project The completed project will become The project is built on the existing the City’s tallest tower standing at foundations, three-storey basement 278 metres high and will provide and seven-storey core that were approximately 1.3 million square previously constructed as part of feet of office space and 43,000 ‘The Pinnacle’ project, which was square feet for restaurants and retail suspended in 2012. The building facilities. The tower will also be the has a concrete central core and first of its kind to house a fresh food a steel frame superstructure market, innovation hub, well-being consisting of steel beams which retreat and spa, curated ‘art walk’ act compositely with concrete as well as London’s highest free slabs, cast onto permanent metal public viewing gallery.