Registered number: SC440783
FOR THE YEAR ENDED 31 DECEMBER 2024
KEPAK GROUP LIMITED
CONTENTS
KEPAK GROUP LIMITED
COMPANY INFORMATION
Page 1
KEPAK GROUP LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The Company is engaged in red meat processing. The Company's turnover was £648m (2023 - £585m). Net assets at 31 December 2024 amounted to £3.4m (2023 - £0.4m).
The Directors are pleased to report that, following the substantial investment in the Company’s Value-Added facility in Wales during 2023, both turnover and profitability have improved in the financial year ended 2024. Continued investment in human capital and operational assets across all sites, combined with long-standing relationships with our trusted farmer supply base, has enabled the Company to operate as a fully integrated, end-to-end service provider at scale.
Market demand for meat products remains robust, contributing to upward pressure on cattle and sheep prices across the industry. The Company'’s vertically integrated model provides customers with enhanced supply chain security, positioning the business to effectively manage market volatility and inflationary pressures in beef and lamb pricing. The Directors believe that the Company is well positioned for future growth, underpinned by strategic capital investments and strong customer partnerships, providing a solid foundation for sustained profitability in 2025.
The Directors are pleased to report that, following the substantial investment in the Company’s Value-Added facility in Wales during 2023, both turnover and profitability have improved in the financial year ended 2024. Continued investment in human capital and operational assets across all sites, combined with long-standing relationships with our trusted farmer supply base, has enabled the Company to operate as a fully integrated, end-to-end service provider at scale.
Market demand for meat products remains robust, contributing to upward pressure on cattle and sheep prices across the industry. The Company'’s vertically integrated model provides customers with enhanced supply chain security, positioning the business to effectively manage market volatility and inflationary pressures in beef and lamb pricing. The Directors believe that the Company is well positioned for future growth, underpinned by strategic capital investments and strong customer partnerships, providing a solid foundation for sustained profitability in 2025.
Economic Risk
The Company’s trading is significantly influenced by (i) the availability and pricing of high quality beef and lamb stocks, (ii) the risk of increased interest rates and/or inflation having an adverse impact on served markets, (iii) the risk of unrealistic increases in wages or infrastructural cost impacting adversely on competitiveness of the Company and its principal customers and (iv) the risk of adverse exchange movements. The Company actively manages its purchasing activity by innovative product sourcing to ensure an adequate supply of stocks to meet market requirements. These risks are also managed by strict control of costs. Foreign exchange exposure is actively managed using both forward foreign exchange contracts and currency contracts.
Competition Risk
The Company has traditionally been at risk from competitors, using tactics such as predatory pricing, looking to damage key customer relationships. The directors of the Company manage competition risk through paying close attention to customer service levels and by distinguishing the Company from our competitors through innovation of both products and services.
Environmental Risk
The Company is continually at risk from the various animal and human health scares that are linked to food. In recent years, this has included foot and mouth disease, avian flu and bovine spongiform encephalopathy. The Company has developed product quality and traceability systems to minimise the potential risks from all known sources.
Financial Risk
The Company has budgetary and financial reporting procedures, supported by appropriate key performance indicators, to manage credit, liquidity and other financial risk.
The Company’s trading is significantly influenced by (i) the availability and pricing of high quality beef and lamb stocks, (ii) the risk of increased interest rates and/or inflation having an adverse impact on served markets, (iii) the risk of unrealistic increases in wages or infrastructural cost impacting adversely on competitiveness of the Company and its principal customers and (iv) the risk of adverse exchange movements. The Company actively manages its purchasing activity by innovative product sourcing to ensure an adequate supply of stocks to meet market requirements. These risks are also managed by strict control of costs. Foreign exchange exposure is actively managed using both forward foreign exchange contracts and currency contracts.
Competition Risk
The Company has traditionally been at risk from competitors, using tactics such as predatory pricing, looking to damage key customer relationships. The directors of the Company manage competition risk through paying close attention to customer service levels and by distinguishing the Company from our competitors through innovation of both products and services.
Environmental Risk
The Company is continually at risk from the various animal and human health scares that are linked to food. In recent years, this has included foot and mouth disease, avian flu and bovine spongiform encephalopathy. The Company has developed product quality and traceability systems to minimise the potential risks from all known sources.
Financial Risk
The Company has budgetary and financial reporting procedures, supported by appropriate key performance indicators, to manage credit, liquidity and other financial risk.
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KEPAK GROUP LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Movement in Turnover
2024 vs. 2023 10.7%
2023 vs. 2022 2.5%
2022 vs. 2021 8.4%
Movement in Operating Profit
2024 vs 2023 450.9%
2023 vs. 2022 (132.1)%
2022 vs. 2021 24.1%
2024 vs. 2023 10.7%
2023 vs. 2022 2.5%
2022 vs. 2021 8.4%
Movement in Operating Profit
2024 vs 2023 450.9%
2023 vs. 2022 (132.1)%
2022 vs. 2021 24.1%
The Companies (Strategic Report) (Climate-related Financial Disclosures) Regulations 2022 has introduced requirements aligned to the Task Force on Climate-related Financial Disclosures (TCFD) framework. Kepak Group Limited supports the TCFD recommendations, and we are committed to developing our climate-related disclosures to engage with our investors and other stakeholders during our climate journey.
Governance arrangements in relation to assessing and managing climate-related risks and opportunities
The sustainability team are responsible for assessing and managing climate-related risks and opportunities. The Head of Sustainability will identify risks and opportunities and will take full ownership of completing and managing. The sustainability leadership council, which is cross functional, is responsible for making decisions around sustainability related projects, reporting requirements, policy and action plans to minimise risk and undertake opportunities. The Senior executive team will have ultimate sign off and steer the business strategy in line with sustainability arrangements.
Governance arrangements in relation to assessing and managing climate-related risks and opportunities
The sustainability team are responsible for assessing and managing climate-related risks and opportunities. The Head of Sustainability will identify risks and opportunities and will take full ownership of completing and managing. The sustainability leadership council, which is cross functional, is responsible for making decisions around sustainability related projects, reporting requirements, policy and action plans to minimise risk and undertake opportunities. The Senior executive team will have ultimate sign off and steer the business strategy in line with sustainability arrangements.
Identifying, assessing, and managing climate-related risks and opportunities
The Company completes a double materiality assessment to identify, assess and manage climate related impacts, risks and opportunities.
The double materiality assessment captures financial and sustainability impacts, risks and opportunities. The risk management process is integrated into the double materiality assessment as a key component to ensure the Company have identified sustainability topics which are relevant to the business. Climate Change is one of those topics.
The Company completes a double materiality assessment to identify, assess and manage climate related impacts, risks and opportunities.
The double materiality assessment captures financial and sustainability impacts, risks and opportunities. The risk management process is integrated into the double materiality assessment as a key component to ensure the Company have identified sustainability topics which are relevant to the business. Climate Change is one of those topics.
Principal climate-related risks and opportunities arising in connection with the Company’s operations
Principle Climate related risks: Physical and transitional risk – 5 – 25-year impact
• Reputational risk due to inability to meet emission reduction targets and / or inability to influence emission reductions within upstream supply chain, affecting ability to secure loans and potentially resulting in reputational fallout and / or loss of market share.
• Investment risk if customers are not willing and / or able to cover additional costs arising from large capital requirements for transitional infrastructure within own operations or investments in emission reductions within upstream supply chain , resulting in loss of market share, increased costs and / or a decrease in revenue.
• Operational efficiency risk if continued rise in industry level emissions results in regulatory reforms that limit cattle production numbers, resulting in a significant disruption in supply and threatening the viability of the Company's business model.
• Operational disruption risk due to changing weather patterns and potential for extreme weather events to impact the Company's operations and supply chain activities, resulting in increased costs and/or decreased.
• Regulatory risk due to increasing regulatory requirements arising from ambitious climate change targets and potential failure to comply, resulting in additional costs and potentially resulting in legal fines and/or sanctions.
Principle Climate related risks: Physical and transitional risk – 5 – 25-year impact
• Reputational risk due to inability to meet emission reduction targets and / or inability to influence emission reductions within upstream supply chain, affecting ability to secure loans and potentially resulting in reputational fallout and / or loss of market share.
• Investment risk if customers are not willing and / or able to cover additional costs arising from large capital requirements for transitional infrastructure within own operations or investments in emission reductions within upstream supply chain , resulting in loss of market share, increased costs and / or a decrease in revenue.
• Operational efficiency risk if continued rise in industry level emissions results in regulatory reforms that limit cattle production numbers, resulting in a significant disruption in supply and threatening the viability of the Company's business model.
• Operational disruption risk due to changing weather patterns and potential for extreme weather events to impact the Company's operations and supply chain activities, resulting in increased costs and/or decreased.
• Regulatory risk due to increasing regulatory requirements arising from ambitious climate change targets and potential failure to comply, resulting in additional costs and potentially resulting in legal fines and/or sanctions.
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KEPAK GROUP LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Principle climate-related opportunities: Physical and transitional risk – 5 – 25 years
• Opportunity to adopt emission reduction technologies and embrace renewable energy solutions within own operations, resulting in decreased costs and increased revenue.
• Opportunity to reduce scope 1, 2 and 3 emissions whilst contributing to industry level emission reductions targets by driving internal climate change mitigation efforts and increasing farmer participation in producer groups, enhancing brand reputation and thus increasing market share.
• Opportunity to gain a competitive advantage by showcasing stronger environmental credentials compared to peers, attracting environmentally conscious customers and increasing market share.
• Opportunity to use market influence and set industry standards for lower carbon footprint across beef supply chain, gaining new customers and increasing market share through enhanced brand reputation.
• Opportunity to adopt emission reduction technologies and embrace renewable energy solutions within own operations, resulting in decreased costs and increased revenue.
• Opportunity to reduce scope 1, 2 and 3 emissions whilst contributing to industry level emission reductions targets by driving internal climate change mitigation efforts and increasing farmer participation in producer groups, enhancing brand reputation and thus increasing market share.
• Opportunity to gain a competitive advantage by showcasing stronger environmental credentials compared to peers, attracting environmentally conscious customers and increasing market share.
• Opportunity to use market influence and set industry standards for lower carbon footprint across beef supply chain, gaining new customers and increasing market share through enhanced brand reputation.
Actual and potential impacts of the principal climate-related risks and opportunities on the Company’s business model and strategy
• Impact on climate change by improving operational efficiency and investing in energy saving technologies to minimise energy consumption and thus reduce GHG emissions within own operations, resulting in positive impact on the environment.
• Impact on climate change by funding and participating in industry level initiatives focused on improving genetics and cattle rearing solutions, resulting in reduced industry level emissions and positive impact on the environment.
• Impact on climate change by influencing and incentivising farmers within the upstream supply chain to reduce on farm emissions, resulting in a positive impact on suppliers and on the environment.
• Impact on climate change by offering less popular cuts of meat to help satisfy market demand with fewer animal inputs, contributing to a reduction in industry emissions and resulting in positive impacts on the environment.
• Impact on climate change due to high level of GHG emissions generated within upstream supply chain, contributing to high industry emissions and resulting in negative impact on the environment.
• Impact on climate change due to high energy use in manufacturing and distribution processes, resulting in negative impacts on the environment.
• Impact on climate change by improving operational efficiency and investing in energy saving technologies to minimise energy consumption and thus reduce GHG emissions within own operations, resulting in positive impact on the environment.
• Impact on climate change by funding and participating in industry level initiatives focused on improving genetics and cattle rearing solutions, resulting in reduced industry level emissions and positive impact on the environment.
• Impact on climate change by influencing and incentivising farmers within the upstream supply chain to reduce on farm emissions, resulting in a positive impact on suppliers and on the environment.
• Impact on climate change by offering less popular cuts of meat to help satisfy market demand with fewer animal inputs, contributing to a reduction in industry emissions and resulting in positive impacts on the environment.
• Impact on climate change due to high level of GHG emissions generated within upstream supply chain, contributing to high industry emissions and resulting in negative impact on the environment.
• Impact on climate change due to high energy use in manufacturing and distribution processes, resulting in negative impacts on the environment.
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KEPAK GROUP LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Targets used by the Company to manage climate-related risks and to realise climate-related opportunities and of performance against those targets
• 50.4% reduction in scope 1 & 2 emissions across operations.
• 100% renewable electricity sourced by 2030.
• 30% reduction in scope 3 category 1 purchased goods and services by 2030.
• Each site has a energy monitoring system in place, energy data is analysed weekly and performance targets are at each one of our sites to reduce scope 1 & 2.
• 80% of the Company's scope 3 contains GHG emissions from the livestock bought – predominantly cattle. Targets are in place for each country in which sourced from to manage industry incentives and support farmers to adopt sustainable agriculture practices. The Company's scope 3 contains primary emission factors which are calculated by industry bodies – livestock emissions are monitored monthly against the Company's targets set.
• Furthermore, the Company have built an agricultural strategy to ensure targets are met and update can be made when required to.
An analysis of the resilience of the business model and strategy of the company taking into consideration of different climate-related scenarios
The Company demonstrates strong resilience in its business model and strategic approach by proactively addressing the risks and opportunities posed by various climate-related scenarios. As a leading meat processing company, the Company is highly exposed to climate change impacts, such as shifts in agricultural productivity, extreme weather events, and evolving regulatory frameworks targeting emissions reduction. To mitigate these risks, the Company has integrated sustainability into its core operations through investments in energy efficiency, supply chain traceability, and low-carbon technologies. The Company’s strategy includes diversifying protein sources, optimizing water and waste management, and engaging with farmers to promote sustainable practices. Under more severe climate scenarios—such as those aligned with a 1.5°C pathway—the Company’s commitment to reducing greenhouse gas emissions and aligning with science-based targets enhances its adaptability and long-term viability. By embedding climate resilience into its decision-making, the Company strengthens its ability to remain competitive, ensure supply chain continuity, and meet the evolving expectations of consumers and regulators.
• 50.4% reduction in scope 1 & 2 emissions across operations.
• 100% renewable electricity sourced by 2030.
• 30% reduction in scope 3 category 1 purchased goods and services by 2030.
• Each site has a energy monitoring system in place, energy data is analysed weekly and performance targets are at each one of our sites to reduce scope 1 & 2.
• 80% of the Company's scope 3 contains GHG emissions from the livestock bought – predominantly cattle. Targets are in place for each country in which sourced from to manage industry incentives and support farmers to adopt sustainable agriculture practices. The Company's scope 3 contains primary emission factors which are calculated by industry bodies – livestock emissions are monitored monthly against the Company's targets set.
• Furthermore, the Company have built an agricultural strategy to ensure targets are met and update can be made when required to.
An analysis of the resilience of the business model and strategy of the company taking into consideration of different climate-related scenarios
The Company demonstrates strong resilience in its business model and strategic approach by proactively addressing the risks and opportunities posed by various climate-related scenarios. As a leading meat processing company, the Company is highly exposed to climate change impacts, such as shifts in agricultural productivity, extreme weather events, and evolving regulatory frameworks targeting emissions reduction. To mitigate these risks, the Company has integrated sustainability into its core operations through investments in energy efficiency, supply chain traceability, and low-carbon technologies. The Company’s strategy includes diversifying protein sources, optimizing water and waste management, and engaging with farmers to promote sustainable practices. Under more severe climate scenarios—such as those aligned with a 1.5°C pathway—the Company’s commitment to reducing greenhouse gas emissions and aligning with science-based targets enhances its adaptability and long-term viability. By embedding climate resilience into its decision-making, the Company strengthens its ability to remain competitive, ensure supply chain continuity, and meet the evolving expectations of consumers and regulators.
Key performance indicators used to assess progress against targets used to manage climate-related risks and realise climate-related opportunities and of the calculations on which those key performance indicators are based
• % renewable electricity consumed
• % self-generated electricity
• kWh per unit of output
• Scope 1 & 2 emissions per unit of output (Tonnes of CO2e / tonne of output)
• % of total revenue attributed to climate related projects
• Scope 3 emissions per unit of output
• % of sustainable agriculture practices adopted by our suppliers
• % renewable electricity consumed
• % self-generated electricity
• kWh per unit of output
• Scope 1 & 2 emissions per unit of output (Tonnes of CO2e / tonne of output)
• % of total revenue attributed to climate related projects
• Scope 3 emissions per unit of output
• % of sustainable agriculture practices adopted by our suppliers
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KEPAK GROUP LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The Directors of the Company must act in a way they consider, in good faith, would most likely promote the success of the Company for the benefits of its members as a whole, and in doing so have regard (amongst other matters) to:
• The likely consequence of any decision in the long term
• The interest of the Company’s employees
• The need to foster the Company’s business relationships with suppliers, customer and others
• The impact of the Company’s operations on the community and the environment
• The desirability of the Company maintaining a reputation for high standards of business conduct
• The need to act fairly as between members of the Company
The Board considers that it has complied in all material respects with their duties under Section 172 (1) of the Companies Act 2006.
• The likely consequence of any decision in the long term
• The interest of the Company’s employees
• The need to foster the Company’s business relationships with suppliers, customer and others
• The impact of the Company’s operations on the community and the environment
• The desirability of the Company maintaining a reputation for high standards of business conduct
• The need to act fairly as between members of the Company
The Board considers that it has complied in all material respects with their duties under Section 172 (1) of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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KEPAK GROUP LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The Directors present their report and the financial statements for the year ended 31 December 2024.
The Directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the Directors are required to:
∙select suitable accounting policies for the Company's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation, amounted to £2,978,302 (2023 - loss £4,900,257).
No dividends (2023 - £Nil) or transfers to reserves are recommended by the Directors.
The Directors who served during the year were:
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KEPAK GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The Company will seek to minimise adverse impacts on the environment from its activities, whilst continuing to address health, safety and economic issues. The Company has complied with all applicable legislation and regulations.
It is the intention of the Directors to continue to develop the activities of the Company.
The Company is committed to a programme of research and development activities which is expected to result in the development of new production and packaging techniques.
The Company places considerable value on the involvement of its employees and has continued its previous practice of keeping them informed on matters affecting them as employees and on the various factors affecting the performance of the Company. This is achieved through formal and informal meetings. In addition, some employees receive an annual bonus related to the overall profitability of the Company.
The Company and its Directors ensure that exceptional customer satisfaction is at the core of the business and it is recognised that, in order to perform successfully, engagement with employees and support where relevant is required as the employees represent the frontline of the delivery of service.
The Company culture is imperative to uphold and this is done so via the Directors and senior management team who are in direct contact with the employees on a regular basis to ensure all objectives are aligned and a good working environment exists within the Company. The Directors, via senior leadership, ensure the setting and maintaining of core Company values, and ensure ethical business behaviours.
The Company culture also includes a focus on building and maintaining relationships with key suppliers and customers, whose support is paramount to the ongoing success of the business. Key suppliers are kept up to date with business developments and offered opportunities as they arise for continued and growing business. Key customers have built a strong relationship with the Company which allows for a joint beneficial relationship with increased business and a common trust on the level of service provided.
The Company culture is imperative to uphold and this is done so via the Directors and senior management team who are in direct contact with the employees on a regular basis to ensure all objectives are aligned and a good working environment exists within the Company. The Directors, via senior leadership, ensure the setting and maintaining of core Company values, and ensure ethical business behaviours.
The Company culture also includes a focus on building and maintaining relationships with key suppliers and customers, whose support is paramount to the ongoing success of the business. Key suppliers are kept up to date with business developments and offered opportunities as they arise for continued and growing business. Key customers have built a strong relationship with the Company which allows for a joint beneficial relationship with increased business and a common trust on the level of service provided.
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KEPAK GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The SECR disclosure presents our carbon footprint within the United Kingdom across Scope 1, 2 and to some extent Scope 3 emissions. It contains an appropriate intensity metric, the total energy use of electricity, gas and transport fuel and a summary of energy efficiency actions taken during the relevant financial year.
ENERGY EFFICIENCY ACTION SUMMARY
1. Governance and Strategic Oversight
• Weekly Environmental Management Meetings
Regular meetings between the Environmental Team and Senior Management are held to review and enhance energy and water management practices.
• Policy Integration
Sustainability and environmental considerations have been embedded into all Standard Operating Procedures (SOPs), including specific focus on water usage.
• Government Collaboration
The company has joined the Welsh Government Sustainability Cluster to align efforts with national sustainability objectives and share best practices.
1. Governance and Strategic Oversight
• Weekly Environmental Management Meetings
Regular meetings between the Environmental Team and Senior Management are held to review and enhance energy and water management practices.
• Policy Integration
Sustainability and environmental considerations have been embedded into all Standard Operating Procedures (SOPs), including specific focus on water usage.
• Government Collaboration
The company has joined the Welsh Government Sustainability Cluster to align efforts with national sustainability objectives and share best practices.
2. Water Efficiency Initiatives
• Tray Wash Project
Implementation of leak repairs, water recycling systems, and staff behavioural training to minimize water waste.
• Slaughter Steriliser Optimization
Replacement of inefficient units and recalibration of pressure and flow to enhance efficiency.
• Gut Room / Tripery Improvements
Leak repairs and cycle adjustments combined with behavioural change initiatives have led to measurable water savings.
• Nozzle Replacement Program
All hand sinks and apron washers in slaughter halls have been retrofitted with low-flow nozzles to reduce water usage.
• Site-Wide Leak Management
An ongoing program to identify and repair leaks across the entire facility infrastructure.
• Preventative Maintenance Protocols
Checks for leaks and water wastage have been added to start-up Planned Preventive Maintenance (PPM) routines for engineering teams.
• Tray Wash Project
Implementation of leak repairs, water recycling systems, and staff behavioural training to minimize water waste.
• Slaughter Steriliser Optimization
Replacement of inefficient units and recalibration of pressure and flow to enhance efficiency.
• Gut Room / Tripery Improvements
Leak repairs and cycle adjustments combined with behavioural change initiatives have led to measurable water savings.
• Nozzle Replacement Program
All hand sinks and apron washers in slaughter halls have been retrofitted with low-flow nozzles to reduce water usage.
• Site-Wide Leak Management
An ongoing program to identify and repair leaks across the entire facility infrastructure.
• Preventative Maintenance Protocols
Checks for leaks and water wastage have been added to start-up Planned Preventive Maintenance (PPM) routines for engineering teams.
3. Cleaning Equipment Upgrades
• Night Hygiene Shift Enhancements
• Night Hygiene Shift Enhancements
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KEPAK GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Cleaning equipment for night shifts has been upgraded with simplified and efficient spray bars.
• Lairage Cleaning Equipment
Introduction of upgraded, water-efficient cleaning systems in the lairage area.
• Electric Steriliser Trial
Trial installation of a Smisco electric steriliser in the Beef Abattoir to evaluate energy and water savings potential.
• Lairage Cleaning Equipment
Introduction of upgraded, water-efficient cleaning systems in the lairage area.
• Electric Steriliser Trial
Trial installation of a Smisco electric steriliser in the Beef Abattoir to evaluate energy and water savings potential.
4. Monitoring and Control Systems
• Energy and Water Monitoring Expansion
The monitoring system in Retail has been expanded to include primary operations, providing deeper insights into resource usage.
• Refrigeration System Oversight
The Environmental Team actively monitors refrigeration system alerts to ensure optimal performance and prevent energy losses.
• Lorry Wash Control System
A coin-operated system has been introduced for the lorry wash to track and control water usage effectively.
• Energy and Water Monitoring Expansion
The monitoring system in Retail has been expanded to include primary operations, providing deeper insights into resource usage.
• Refrigeration System Oversight
The Environmental Team actively monitors refrigeration system alerts to ensure optimal performance and prevent energy losses.
• Lorry Wash Control System
A coin-operated system has been introduced for the lorry wash to track and control water usage effectively.
METHODOLOGY NOTES
SECR disclosure has been prepared in line with the Company's annual accounts made up to 31 December 2024. Using operational control approach, GHG Emissions reporting are in line with the Greenhouse Gas (GHG) Protocol Corporate Accounting and Reporting Standard. Relevant data is prepared on a monthly basis by our external energy management supplier. The validity, accuracy and completeness of the data was checked and used to calculate the GHG emissions for the Company.
Emissions are calculated as activity data multiplied by emission factors (DEFRA, 2024 for all emission and conversion factors, source: https://www.gov.uk/government/publications/greenhouse-gas-reporting-conversion-factors-2024); kWh consumption is calculated as activity multiplied by conversion factors (Federal Register EPA for natural gas and gasoline (petrol), (https://www.ecfr.gov/cgi-bin/text-idx?SID=ae265d7d6f98ec86fcd8640b9793a3f6&mc=true&node=pt40.23.98&rgn=div5#ap40.23.98_138.1). EPA GHG Emission Factors Hub for natural gas and gasoline (petrol) (https://www.epa.gov/climateleadership/center-corporate-climate-leadership-ghg-emission-factors-hub. U.S. Energy Information Administration for diesel (https://www.eia.gov/totalenergy /data/monthly /pdf/sec12_2.pdf ).
Where applicable, consumption was converted to kWh using conversion factors linked above, while emissions were calculated with the DEFRA emission factors.
Based on the nature of the business, as well as following the recommendations of the SECR legislation we chose the following intensity metric: Tonnes of total production. This metric shows the development of our energy efficiency in line with the production and shows great transparency expressing the business's annual emissions. Due to rounding there might be a minor difference compared to the actual GHG emissions (no more than 1%).
SECR disclosure has been prepared in line with the Company's annual accounts made up to 31 December 2024. Using operational control approach, GHG Emissions reporting are in line with the Greenhouse Gas (GHG) Protocol Corporate Accounting and Reporting Standard. Relevant data is prepared on a monthly basis by our external energy management supplier. The validity, accuracy and completeness of the data was checked and used to calculate the GHG emissions for the Company.
Emissions are calculated as activity data multiplied by emission factors (DEFRA, 2024 for all emission and conversion factors, source: https://www.gov.uk/government/publications/greenhouse-gas-reporting-conversion-factors-2024); kWh consumption is calculated as activity multiplied by conversion factors (Federal Register EPA for natural gas and gasoline (petrol), (https://www.ecfr.gov/cgi-bin/text-idx?SID=ae265d7d6f98ec86fcd8640b9793a3f6&mc=true&node=pt40.23.98&rgn=div5#ap40.23.98_138.1). EPA GHG Emission Factors Hub for natural gas and gasoline (petrol) (https://www.epa.gov/climateleadership/center-corporate-climate-leadership-ghg-emission-factors-hub. U.S. Energy Information Administration for diesel (https://www.eia.gov/totalenergy /data/monthly /pdf/sec12_2.pdf ).
Where applicable, consumption was converted to kWh using conversion factors linked above, while emissions were calculated with the DEFRA emission factors.
Based on the nature of the business, as well as following the recommendations of the SECR legislation we chose the following intensity metric: Tonnes of total production. This metric shows the development of our energy efficiency in line with the production and shows great transparency expressing the business's annual emissions. Due to rounding there might be a minor difference compared to the actual GHG emissions (no more than 1%).
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KEPAK GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The auditors, Forvis Mazars, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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KEPAK GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KEPAK GROUP LIMITED
We have audited the financial statements of Kepak Group Limited (the 'Company') for the year ended 31 December 2024, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Cash Flows, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
In auditing the financial statements, we have concluded that the Directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report.
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KEPAK GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KEPAK GROUP LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The Directors are responsible for the other information contained within the Annual Report. our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.
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KEPAK GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KEPAK GROUP LIMITED (CONTINUED)
our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Based on our understanding of the Company and its industry, we identified that the principal risks of non-compliance with laws and regulations related to the UK tax legislation, pensions legislation, employment regulation and health and safety regulation, anti-bribery, corruption and fraud, money laundering, non-compliance with implementation of government support schemes relating to COVID-19, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements, such as the Companies Act 2006.
We evaluated the Directors’ and management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) and determined that the principal risks were related to posting manual journal entries to manipulate financial performance, management bias through judgments and assumptions in significant accounting estimates and significant one-off or unusual transactions.
Our audit procedures were designed to respond to those identified risks, including non-compliance with laws and regulations (irregularities) and fraud that are material to the financial statements. Our audit procedures included but were not limited to:
• Discussing with the Directors and management their policies and procedures regarding compliance with laws and regulations;
• Communicating identified laws and regulations throughout our engagement team and remaining alert to any indications of non-compliance throughout our audit; and
• Considering the risk of acts by the Company which were contrary to applicable laws and regulations, including fraud.
Our audit procedures in relation to fraud included but were not limited to:
• Making enquiries of the Directors and management on whether they had knowledge of any actual, suspected or alleged fraud;
• Gaining an understanding of the internal controls established to mitigate risks related to fraud;
• Discussing amongst the engagement team the risks of fraud; and
• Addressing the risks of fraud through management override of controls by performing journal entry testing.
There are inherent limitations in the audit procedures described above and the primary responsibility for the prevention and detection of irregularities including fraud rests with management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our
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KEPAK GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KEPAK GROUP LIMITED (CONTINUED)
Auditors' Report.
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants and Statutory Audit Firm
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KEPAK GROUP LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
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KEPAK GROUP LIMITED
REGISTERED NUMBER: SC440783
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 21 to 37 form part of these financial statements.
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KEPAK GROUP LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
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KEPAK GROUP LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
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KEPAK GROUP LIMITED
ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2024
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
The Company is limited by shares and incorporated in the United Kingdom, having its registered office at Cookston Road, Portlethen, Aberdeen, AB12 4QB, Scotland. The Company's registered number is SC440783. The Company's principal activity continued to be beef and lamb processing.
2.ACCOUNTING POLICIES
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
Functional and presentation currency
Transactions and balances
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.ACCOUNTING POLICIES (CONTINUED)
Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.ACCOUNTING POLICIES (CONTINUED)
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.ACCOUNTING POLICIES (CONTINUED)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Finished goods cost is calculated in two main ways depending on the nature of the stock:
1. Standard costing – raw material costs together with an appropriate amount of direct labour and overhead is included in the stocks valuation.
2. Estimate of cost based on selling price – where actual costs cannot be accurately ascertained, an approximation is made by deducting the costs of marketing, distribution and selling from the net invoice price.
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.ACCOUNTING POLICIES (CONTINUED)
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the reporting date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or income as appropriate. The company does not currently apply hedge accounting for interest rate and foreign exchange derivatives.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or income as appropriate. The company does not currently apply hedge accounting for interest rate and foreign exchange derivatives.
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Provision for Risks and Liabilities:
A provision is recognised in the balance sheet when the Company has a present legal or constructive obligation as a result of a past event, and it is probable that an outflow of economic benefits would be required to settle the obligation.
If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects the time value of money and, where appropriate, the risks specific to the liability.
Analysis of turnover by country of destination:
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 28
KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
10.TAXATION (CONTINUED)
In 2021 an increase in the corporation tax rate to 25% with effect from 1 April 2023 was substantively enacted. The 23.5% rate used above in the prior year reflects 9 months of this new rate and 3 months of the previous rate of 19%.
In 2021, the Organisation for Economic Co-operation and Development "(OECD)" published the Global Anti-Base Erosion Model Rules (Pillar 2). These rules will impose a top-up tax on the profits of subsidiaries of multinational enterprise groups that are taxed at an effective tax rate of less than 15 percent. Kepak Holdings Group (“the Group”) is within scope of Pillar 2 legislation, effective from 1 January 2024. The Group is within scope of Pillar 2 legislation due to Group Turnover levels.
The OECD Inclusive Framework has also introduced transitional ‘Safe Harbours’, which will significantly reduce the Pillar Two compliance burden for many businesses for the first three years during which rules will apply (2024-2026). These Safe Harbour OECD rules have been included in the corresponding legislation.
An assessment of the Safe Harbour rules identified that the Group meets the criteria to qualify for ‘Safe Harbours’ and therefore the Group will not be subject to a top-up tax under Pillar 2 rules in 2024 in any jurisdiction. The same assessment will be undertaken for 2025 and 2026 and based on current information regarding the Group entities operations, there is an expectation that Pillar 2 exemptions will also apply for those financial years.
In 2021, the Organisation for Economic Co-operation and Development "(OECD)" published the Global Anti-Base Erosion Model Rules (Pillar 2). These rules will impose a top-up tax on the profits of subsidiaries of multinational enterprise groups that are taxed at an effective tax rate of less than 15 percent. Kepak Holdings Group (“the Group”) is within scope of Pillar 2 legislation, effective from 1 January 2024. The Group is within scope of Pillar 2 legislation due to Group Turnover levels.
The OECD Inclusive Framework has also introduced transitional ‘Safe Harbours’, which will significantly reduce the Pillar Two compliance burden for many businesses for the first three years during which rules will apply (2024-2026). These Safe Harbour OECD rules have been included in the corresponding legislation.
An assessment of the Safe Harbour rules identified that the Group meets the criteria to qualify for ‘Safe Harbours’ and therefore the Group will not be subject to a top-up tax under Pillar 2 rules in 2024 in any jurisdiction. The same assessment will be undertaken for 2025 and 2026 and based on current information regarding the Group entities operations, there is an expectation that Pillar 2 exemptions will also apply for those financial years.
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 31
KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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GOVERNMENT GRANTS
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Page 35
KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Profit and loss account
The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £1,365,039 (2023 - £1,286,255). Contributions totalling £185,049 (2023 - £246,455) were payable to the fund at the balance sheet date and are included in creditors.
25.OTHER FINANCIAL COMMITMENTS
The Company’s bankers have given guarantees to the UK and Dutch Revenue authorities on behalf of the Company amounting to £537k (2023 – £538k).
Page 36
KEPAK GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Comparative amounts have been regrouped where necessary, on a basis consistent with the current year.
The Company's parent is Kepak Holdings; the ultimate holding company is Kingate Investments Unlimited, an unlimited company incorporated in the Isle of Man.
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