CLAVERLEY GROUP LIMITED – SECTION 172 STATEMENT

 The Board of Directors, in line with their duties under s172 of the Companies Act 2006, have acted in a way that they consider, in good faith, promotes the success of the group for the benefit of its members as a whole, and in doing so have regard to a range of matters when making decisions for the long term.

During the year several key decisions have been made by the directors which have been reached through engaging with the relevant stakeholders and fully understanding the long-term implications. The directors are fully briefed through the production of detailed board papers which are distributed well in advance of the Board Meetings.

Diversification through Disposals and Acquisitions

The final part of the group’s strategy to diversify away from newspaper publishing and commercial printing was completed in May 2024 with the disposal of Precision Colour Printing (PCP). The commercial printing business had struggled to return to profitability since the COVID pandemic because of ongoing industry pressures and significantly increased energy costs. The injection of capital investment and new ways of working will hopefully ensure that PCP returns to delivering sustainable profits.

In September 2024 the company completed the acquisition of Extreme Exhibitions. Extreme provides a fully integrated design and build service for complex exhibitions stands to their global customer base. As experts in experiential marketing Extreme add further breadth to the group’s wider B2B marketing offering. Supported by the appointment of a Managing Director, the business has been integrated very well and is performing ahead of expectations. Regular engagement with staff has taken place to ensure that any concerns over the purchase are addressed and that the business will continue to provide the high level of customer service which it has always delivered.

As a result of underlying profit growth, the group is well placed to make further acquisitions.

Environment

The Group takes its environmental responsibilities seriously and recognises that business activities inevitably have an impact on the natural environment. In particular, the directors continue to make decisions to support Kennedy’s continued commitment to reducing its environmental impact through a series of measures.

Alongside the Children’s Publishers Forum, Kennedy agreed to a sustainability pledge which outlines clear targets and timelines for improvements within the sector. This will include the removal of certain gifts including PVC accessories and sequins. In addition, all manufactured gifts now contain 30% recycled materials, and all packaging is recyclable either at kerbside or as part of Wastebuster’s Read to Recycle programme. By January 2026, all PVC will be eliminated, and EPS (Expanded Polystyrene) will only be used on products where there is no safe alternative.

The Read to Recycle scheme, of which Kennedy are a founding member, has officially rolled out nationwide to 160 Tesco stores. Families are now able to recycle their broken plastic toys in exchange for book rewards in schools.

In addition, Cubiquity continues its drive on Environmental, Social and Governance initiatives (ESG) and are on target to achieve their Carbon Net Zero plan. In 2024, Cubiquity achieved one of the highest print and media procurement industry accolades and was awarded EcoVadis Platinum Medal representing the top 1% of companies in all industries.

Sale of Buildings

Historically the Group has owned substantial property assets as it has printed its own newspaper titles and manufactured commercial printing solutions. Following the sale of the Midland News Association (MNA) in September 2023, the group’s historic base in Queen Steet, Wolverhampton was no longer required. This property was sold in April 2024. The company moved its head office to Shrewsbury in October 2024, where it now occupies brand new and purpose-built premises on a tenancy basis.

This leaves Halesfield, Telford as the only group owned property. This site is used by PCP for commercial printing, who pay a quarterly rent to the Company. All other subsidiaries within the group operate in rented office accommodation across the UK.

Pension Scheme Buy-Outs

At the start of the year, the Company was the principal employer of three defined benefit pension schemes. In February 2024, with support from the Company, the trustees of the Guernsey Press Scheme agreed to a bulk annuity purchase (Buy-In) with Aviva for all the Scheme members. Significant effort was spent on engaging with the members through letters, the local newspaper and a well-attended Question & Answer event on the island. The members’ feedback was positive, and they got comfort from the greater security that Aviva could provide for their future pension income. The project is progressing well and assigning individual polices to members (Buy-Out) is on track to be completed before the end of June 2025. The scheme’s estimated scheme surplus will be circa £1.5m.

An Actuarial Valuation of the Guiton Group pension scheme, for former employees of the Jersey Evening Post, was completed in January 2025. This showed that the Scheme was in surplus on a Buy-Out basis. Following dialogue with the Company, the scheme’s trustees have engaged a preferred insurer to begin the Buy-In process. Extensive dialogue with members will again take place to ensure members get additional comfort on the security of their pensions. It is expected that full Buy-Out will be achieved before the end of 2026.

The Company’s largest defined benefit pension scheme, the Star Group Scheme, is currently close to being in surplus on a technical provisions basis. The scheme is well hedged (90% on a gilts+0.5%p.a. basis) and with gilt yields remaining high the company is working with the trustees to explore potential options.

This report was approved by the board on 22 May 2025 and signed on its behalf.

G H Williams, Director